EXHIBIT 3.37
LIMITED LIABILITY COMPANY AGREEMENT
OF
PACIFIC LONGLINE COMPANY LLC
TABLE OF CONTENTS
Page
1. FORMATION AND TERM........................................................1
A. Formation............................................................1
B. Term.................................................................1
2. DEFINITIONS...............................................................1
3. NAME, OFFICE OF THE COMPANY AND REGISTERED AGENT..........................5
A. Name.................................................................5
B. Office of the Company................................................5
C. Registered Agent.....................................................5
4. BUSINESS OF THE COMPANY...................................................5
5. MEMBERS, INTERESTS AND CAPITAL............................................5
A. Members and Interests................................................5
B. Initial Capital Contribution.........................................6
C. Additional Capital Contributions.....................................6
D. Default Remedy.......................................................6
E. Guaranty of Company Indebtedness.....................................8
F. No Third Party Beneficiaries.........................................8
G. Capital Accounts.....................................................9
H. Additional Provisions on Capital and Obligations of Members..........9
6. ALLOCATIONS AND DISTRIBUTIONS............................................10
A. Net Income, Net Loss and Credits....................................10
B. Funds Available for Distribution....................................10
C. Gain from Sale......................................................10
D. Loss from Sale......................................................10
E. Minimum Gain Chargeback.............................................10
F. Allocations to Reflect Book Value/Tax Disparity.....................11
G. Qualified Income Offset.............................................11
H. Economic Consistency Special Allocations............................11
7. MANAGEMENT...............................................................11
A. Managing Member.....................................................11
B. Management of the Company...........................................12
C. Major Decision Approval.............................................12
D. Execution of Documents..............................................13
E. Compensation and Reimbursement of Members and Managing Member.......13
F. Valuation of the Company............................................13
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8. AUTHORITY OF THE MEMBERS AND THEIR AFFILIATES TO DEAL WITH
THE COMPANY..............................................................14
9. AUTHORITY OF THE MEMBERS TO ENGAGE IN OTHER BUSINESSES...................14
10. ACCOUNTS, BOOKS, RECORDS, ACCOUNTING, REPORTS AND TAX MATTERS............14
A. Bank Accounts.......................................................14
B. Books and Records...................................................14
C. Tax Information.....................................................15
D. Tax Elections.......................................................15
E. Tax Matters Partner.................................................15
11. INDEMNIFICATION AND EXCULPATION OF MEMBERS...............................15
A. Indemnification.....................................................15
B. Exculpation.........................................................15
12. ASSIGNABILITY OF COMPANY INTERESTS.......................................15
A. Limitations.........................................................15
B. Substituted Members.................................................15
C. Transfer of Interest................................................16
D. Sale of the Company.................................................17
13. DISSOLUTION OR BANKRUPTCY OF A MEMBER....................................17
A. Dissolution.........................................................17
B. Incompetency or Bankruptcy..........................................17
14. TERMINATION..............................................................18
A. Events Causing Dissolution and Winding Up...........................18
B. Election to Continue Company........................................18
C. Winding Up Company Affairs..........................................18
15. AMENDMENTS...............................................................19
A. General Amendments..................................................19
B. Changes Affecting Members...........................................19
16. MISCELLANEOUS............................................................19
A. Governing Law.......................................................19
B. Captions............................................................19
C. Construction........................................................19
D. Survival of Representations and Warranties..........................19
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E. Severability........................................................20
F. Successors..........................................................20
G. Execution and Counterparts..........................................20
H. Entire Agreement....................................................20
17. NOTICES..................................................................20
A. Addresses...........................................................20
B. Communications......................................................20
C. Effective Date......................................................21
18. MANAGING MEMBER AS ATTORNEY-IN-FACT......................................21
A. Appointment of Managing Member as Attomey-In-Fact...................21
B. Irrevocable Appointments............................................21
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LIMITED LIABILITY COMPANY AGREEMENT
OF
PACIFIC LONGLINE COMPANY LLC
THIS LIMITED LIABILITY COMPANY AGREEMENT is made effective as of the _____
day of September, 2001, by and among Aleutian Spray Fisheries, Inc., a
Washington corporation ("Aleutian Spray"), American Seafoods Group LLC, a
Delaware limited liability company ("American Seafoods"), and Webjorn Eikrem, an
individual ("Eikrem").
In consideration of the mutual covenants herein contained, the parties
agree as follows:
1. FORMATION AND TERM.
------------------
A. Formation.
---------
The parties have formed a limited liability company pursuant to
the Washington Limited Liability Company Act (RCW 25.15) by filing a certificate
of formation with the Washington Secretary of State.
B. Term.
----
The Company shall continue until December 31, 2050, unless sooner
terminated in accordance with this Agreement.
2. DEFINITIONS.
-----------
The following terms used in this Agreement shall (unless otherwise
expressly provided herein or unless the context otherwise requires) have the
following respective meanings:
A. Act.
---
The Washington Limited Liability Company Act, as set forth in the
Revised Code of Washington (RCW 25.15), as it may be amended or superseded from
time to time.
B. Agreement.
---------
This Limited Liability Company Agreement, as originally executed
and as amended from time to time, as the context requires.
C. Bankruptcy.
----------
(1) The filing of an application by a Member for, or its consent
to, the appointment of a trustee, receiver, or custodian of its assets;
LLC Agreement of
Pacific Longline Company LLC - 1
(2) The entry of an order for relief with respect to a Member in
proceedings under the United States Bankruptcy Code, as amended or superseded
from time to time;
(3) The making by a Member of a general assignment for the
benefit of creditors;
(4) The entry of an order, judgment or decree by any court of
competent jurisdiction appointing a trustee, receiver or custodian of the assets
of a Member unless the proceedings and the person appointed are dismissed within
ninety (90) days;
(5) The failure by a Member generally to pay its debts as the
debts become due within the meaning of Section 303(h)(l) of the United States
Bankruptcy Code, as determined by the bankruptcy court, or the admission in
writing of its inability to pay its debts as they become due; or
(6) Suffering or permitting a Member's Interest to become
subject to the enforcement of any rights of a creditor of a Member, whether
arising out of an attempted charge upon that Member's Interest by judicial
process or otherwise, if that Member fails to effectuate the release of those
enforcement rights, whether by legal process, bonding, or otherwise, within
ninety (90) days after actual notice of that creditor's action.
D. Capital Account.
---------------
As of any date the capital account maintained for each Member
under Section 5G.
E. Capital Contribution.
--------------------
The total amount of money and the agreed upon fair market value
of property contributed to the Company by a Member or its predecessor in
interest on the date of contribution net of liabilities secured by that
contributed property that the Company is considered to assume or to be subject
to under Section 752 of the Code.
F. Code.
----
The 1986 Internal Revenue Code, as amended from time to time.
G. Company.
-------
Pacific Longline Company LLC.
H. Conversion Notice.
-----------------
LLC Agreement of
Pacific Longline Company LLC - 2
The notice described in Section 5D(2)(b)(ii) of a Lending
Member's intent to convert to a Capital Contribution a loan made by that Lending
Member to a Defaulting Member.
I. Default Notice.
--------------
The notice described in Section 5D(2)(b)(i) of a Non-Defaulting
Member's intent to make a Capital Contribution upon default by a Member.
J. Defaulting Member.
-----------------
A Member who fails to pay all amounts then due from that Member
under this Agreement.
K. Disposition.
-----------
The sale, assignment, transfer, exchange or other disposition of
an Interest, in any manner, whether voluntary or involuntary, by operation of
law or otherwise.
L. Gain or Loss from Sale.
----------------------
Any gain or loss for federal income tax purposes resulting from
the sale or other disposition of the capital assets of the Company not in the
ordinary course of the Company's business.
M. Interest.
--------
The ownership interest, expressed as a percentage, of a Member in
the Company at any particular time, initially as set forth in Section 5A,
including the right of the Member to any and all benefits to which the Member is
entitled and the obligations to which the Member is subject under the Agreement.
N. Lending Member.
--------------
A Non-Defaulting Member who lends money to a Defaulting Member
under Section 5D(2)(a).
O. Managing Member.
---------------
American Seafoods Group LLC, a Delaware limited liability
company.
P. Members.
-------
The Members shall be Aleutian Spray, American Seafoods, Webjorn
Eikrem, and any person or entity admitted as an additional Member or a successor
Member under this Agreement.
LLC Agreement of
Pacific Longline Company LLC - 3
Q. Minimum Gain.
------------
As of any date, the amount determined under Code Section 704(b)
and applicable Regulations by computing with respect to each nonrecourse
liability of the Company the amount of gain (of whatever character), if any,
that would be realized by the Company if it disposed of the Company property
subject to that liability for no consideration other than full satisfaction of
the liability and by then aggregating the separately computed gains.
R. Modified Negative Capital Account.
---------------------------------
The deficit balance of a Capital Account in excess of the portion
of the deficit the Member is deemed obligated to restore pursuant to Code
Section 704(b) and applicable Regulations.
S. Net Income or Net Loss.
----------------------
The income or loss, as the case may be, of the Company for a
period as determined in accordance with Section 703(a)(l) of the Code, including
each item of income, gain, loss or deduction required to be separately stated,
but excluding Gain or Loss from Sale and items specifically allocated under
Section 6.
T. Non-Defaulting Member.
---------------------
A Member who has paid all amounts then due from that Member under
this Agreement.
U. Prime Rate.
----------
The prime rate (or base rate) reported in the "Money Rates"
column or section of The Wall Street Journal as being the base rate on corporate
loans at larger U.S. Money Center banks on the first date on which The Wall
Street Journal is published in each month.
In the event The Wall Street Journal ceases publication of the
Prime Rate, then the "Prime Rate" shall mean the "prime rate" or "base rate"
announced by the bank with which the Company has its principal banking
relationship (whether or not such rate has actually been charged by that bank)
or as otherwise designated by the Members. In the event that bank discontinues
the practice of announcing that rate, Prime Rate shall mean the highest rate
charged by that bank on short-term, unsecured loans to its most credit-worthy
large corporate borrowers, unless otherwise designated by the Members.
V. Regulations.
-----------
The regulations issued under the Code, as amended from time to
time.
LLC Agreement of
Pacific Longline Company LLC - 4
W. Successor in Interest.
---------------------
The person who succeeds to an Interest upon the death,
incompetency, or Bankruptcy of a Member.
X. Unit.
----
A single element of a member's interest in the Company. The total
Interest in the Company shall be comprised of Three Thousand (3,000) Units. Each
Member shall hold the Units set forth adjacent to their name in Section 5A.
3. NAME, OFFICE OF THE COMPANY AND REGISTERED AGENT.
------------------------------------------------
A. Name.
----
The name of the Company is Pacific Longline Company LLC. The
business of the Company may be conducted under such trade or fictitious names as
the Members may determine.
B. Office of the Company.
---------------------
The principal place of business of the Company shall be ▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇. The specified
office of the Company at which shall be kept the records required to be
maintained by the Company under the Act shall be the principal place of business
of the Company, or such other place or places as the Members shall deem
advisable.
C. Registered Agent.
----------------
The Company's agent for service of process shall be ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ L.L.P., ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇,
or such other person as the Members may designate.
4. BUSINESS OF THE COMPANY.
-----------------------
The business of the Company shall be to manage the long line
vessels NORTH CAPE, Official Number 950038; DEEP PACIFIC, Official Number
640128; and ▇▇▇▇▇ ▇▇▇, Official Number 976538 (collectively, the "Vessels"); and
to engage in any and all lawful business activities related or incidental
thereto or any other business permitted by law.
5. MEMBERS, INTERESTS AND CAPITAL.
------------------------------
A. Members and Interests.
---------------------
LLC Agreement of
Pacific Longline Company LLC - 5
The names of the Members, Units held by the Members and Interests
of the Members are as follows:
Name Units Interest
------------------------------ ----- --------
Aleutian Spray Fisheries, Inc. 600 20%
American Seafoods Group LLC 1800 60%
Webjorn Eikrem 600 20%
B. Initial Capital Contribution.
----------------------------
Upon execution of this Agreement, the Members shall contribute to
the Company the amount of cash set forth opposite the name of each:
Name Amount
------------------------------- ------------
Aleutian Spray Fisheries, Inc. $___________
American Seafoods Group LLC $___________
Webjorn Eikrem $___________
C. Additional Capital Contributions.
--------------------------------
If, in the reasonable opinion of Members holding a majority of
the Interests, additional capital is needed by the Company for debt service or
other Company obligations incurred in accordance with this Agreement, or to
protect and preserve the value of the Company's property or assets, the Members
shall, within twenty (20) days after notice from a Managing Member indicating
the need for that additional capital and the purposes for which that additional
capital is required, contribute their proportionate share of the additional
capital specified in the notice.
D. Default Remedy.
--------------
(1) (a) If a Member fails to pay any amount that it is required
to pay under this Agreement (including Capital Contributions under Sections 5B
or 5C), it shall be a Defaulting Member. The Company and the Non-Defaulting
Members may each pursue any and all available legal or equitable remedies
against the Defaulting Member, including, without limitation, actions to compel
payment of the amount due. The Members each waive the requirement that any
action for collection be in the form of an accounting proceeding or that they
await the dissolution of the Company. The Defaulting Member shall pay interest
to the Company on the amount in default at an annual interest rate of five
percent (5%) above the Prime Rate (but in no event at an interest rate higher
than the maximum rate legally permitted) and reasonable fees (including
attorneys'), costs and expenses of enforcement incurred by the Company and/or
the Non-Defaulting Members. Interest shall begin to accrue on the twenty first
(21st) day after the notice from the Managing Member described in Section 5C.
LLC Agreement of
Pacific Longline Company LLC - 6
(b) In lieu of pursuing any right or remedy under this
Agreement or at law or in equity, a Non-Defaulting Member shall have the right
to demand and receive from the Company an immediate return of the additional
Capital Contribution that was made by such Non-Defaulting Member but not made by
the Defaulting Member.
(2) In addition to the remedies described in Section 5D(l)(a)
and (b), a Non-Defaulting Member shall have the following cumulative rights and
remedies:
(a) A Non-Defaulting Member may lend to the Defaulting
Member, on a demand basis, all or any part of the amount in default. The loan
shall be disbursed by the Lending Member to the Company on behalf of the
Defaulting Member. The Defaulting Member shall be deemed to have made a Capital
Contribution to the Company in the amount of the loan, subject to reduction as
described in Section 5D(2)(b)(iii). The loan shall bear interest at an annual
interest rate of five percent (5%) above the Prime Rate (but in no event at an
interest rate higher than the maximum rate legally permitted). The Lending
Member shall have a continuing lien and security interest on the Interest of the
Defaulting Member to secure the repayment of the loan and interest due thereon,
which lien may be foreclosed and enforced at any time and from time to time in
accordance with applicable law, after ten (10) days' prior notice to the
Defaulting Member. The Defaulting Member will pay all reasonable attorneys' fees
in connection with preparation and review of the instruments necessary to
perfect such lien. All distributions otherwise payable to the Defaulting Member
while any loan from the Lending Member remains unpaid shall be paid to the
Lending Member and applied first to the payment of interest and then to the
principal of the loan.
(b) (i) A Non-Defaulting Member may make a Capital
Contribution to the Company in the amount that the Defaulting Member is in
default, at any time before the Non-Defaulting Member makes a loan under Section
5D(2)(a) in the full amount in default. If a Non-Defaulting Member desires to
exercise the election to make a Capital Contribution as provided in this Section
5D(2)(b), it shall give a Default Notice to the Defaulting Member. If the
Defaulting Member does not cure the default within ten (10) days after the
Default Notice is given, by payment of the amount in default (and interest
thereon), the Non-Defaulting Member may make a Capital Contribution to the
Company within twenty (20) days after the date of the Default Notice.
(ii) The Lending Member may convert the principal
amount of a loan made under Section 5D(2)(a) into a Capital Contribution at any
time before such loan is repaid. If the Lending Member desires to exercise the
election to convert a loan to a Capital Contribution as provided in this Section
5D(2)(b)(ii), the Lending Member shall give a Conversion Notice to the
Defaulting Member. If the Defaulting Member does not cure the default within ten
(10) days after the Conversion Notice is given, by repayment of the loan which
the Lending Member desires to convert into a Capital Contribution, together with
unpaid interest thereon, then upon the expiration of such ten (10) day period,
the principal amount of the loan shall automatically be converted to a Capital
Contribution as herein described. The principal of the loan shall be
extinguished upon such conversion, and the Defaulting Member shall not have any
right to repay the principal amount of a loan made by the Lending Member after
the conversion of such loan into a Capital Contribution. However, the Defaulting
Member shall remain liable to the Lending Member for accrued and unpaid interest
on such loan.
LLC Agreement of
Pacific Longline Company LLC - 7
(iii) Upon the Capital Contribution under Section 5D(2)
(b)(i) or conversion under Section 5D(2)(b)(ii), the Interest of each Member
shall be recalculated and shall be equal to a fraction, the numerator of which
shall be the Capital Contribution of that Member, and the denominator of which
shall be the aggregate Capital Contribution of the Members. Before a
recalculation described in the preceding sentence resulting from a conversion
under Section 5D(2)(b)(ii), the Capital Contribution of a Defaulting Member
shall be reduced by the amount of the Capital Contribution deemed made by the
Defaulting Member pursuant to Section 5D(2)(a), and the Capital Contribution of
a Non-Defaulting Member shall be increased by the principal amount of the loan
that is being converted by the Non-Defaulting Member under Section 5D(2)(b)(ii).
E. Guaranty of Company Indebtedness.
--------------------------------
The Members shall not be obligated to guarantee Company
indebtedness unless they mutually agree to do so.
F. No Third Party Beneficiaries.
----------------------------
The foregoing provisions of this Section are not intended to be
for the benefit of any creditor or other person to whom any debts, liabilities
or obligations are owed by (or who otherwise has any claim against) the Company
or any of the Members; and no creditor or other person shall obtain any right
under any of the foregoing provisions or shall by reason of any of the foregoing
provisions make any claim in respect of any debt, liability or obligation (or
otherwise) against the Company or any of the Members.
G. Capital Accounts.
----------------
(1) (a) A Capital Account shall be established and maintained
for each Member. A Member shall have a single Capital Account regardless of
class and regardless of the time or manner in which any portion of that Interest
was acquired. If an Interest is transferred in accordance with this Agreement,
the transferee shall succeed to the Capital Account of the transferor to the
extent it relates to the transferred Interest.
(b) As of any date, a Member's Capital Account shall
consist of: (i) the sum of (A) the amount of money contributed by him to the
Company, (B) the agreed upon fair market value of property contributed by him to
the Company, (C) allocations to him of Net Income and Gain from Sale (or items
thereof)(other than gain under Section 6F), including income and gain exempt
from tax, and (D) the amount of any Company liabilities assumed by that Member
or that are secured by any Company assets distributed to that Member; minus (ii)
the sum of (A) the amount of money distributed to him by the Company, (B) the
fair market value of property distributed to him by the Company, (C) the amount
of any liabilities of that Member assumed by the Company or secured by any
property contributed by that Member to the Company other than those taken into
account in calculating Capital Contributions, (D) allocations to him of
expenditures
LLC Agreement of
Pacific Longline Company LLC - 8
of the Company described in Section 705(a)(2)(B) of the Code or treated as such
expenditures under the Regulations, and (E) allocations to him of Net Loss and
Loss from Sale (or items thereof).
(c) (i) In the discretion of the Members the Capital
Account of each Member may be adjusted to reflect a revaluation of the Company's
assets upon the occurrence of the following events:
(A) The contribution of money or other property
(other than a de minimis amount) to the Company by a new or existing Member as
consideration for an Interest;
(B) The distribution of money or other property
(other than a de minimis amount) by the Company to a retiring or continuing
Member as consideration for an Interest; or
(C) The liquidation of the Company within the
meaning of Regulation Section 1.704-l(b)(2)(ii)(g).
(ii) The adjustment shall be based on the fair market
value of Company property (taking Section 7701 (g) of the Code into account) on
the date of adjustment, and shall reflect the manner in which the unrealized
income, gain, loss or deduction inherent in the property (that has not
previously been reflected in Capital Accounts) would be allocated among the
Members if there were a taxable disposition of the property for fair market
value on that date.
(d) If any Company asset has a book value that differs from
the adjusted tax basis of that asset, then the Capital Accounts shall be
adjusted in accordance with Regulation Section 1.704-l(b)(2)(iv)(g) for
allocations of depreciation, depletion, amortization and gain or loss computed
for book purposes rather than tax purposes, with respect to such asset.
(e) If there is any basis adjustment pursuant to an
election under Section 754 of the Code, then Capital Accounts shall be adjusted
to the extent required by the Regulations.
(f) The principles governing the adjustments of Capital
Accounts are intended to satisfy the capital account maintenance requirements of
Regulation Section 1.704-l(b)(2)(iv) and shall be construed consistently
therewith.
H. Additional Provisions on Capital and Obligations of Members.
-----------------------------------------------------------
(1) No Member gives up any of its rights to be repaid its
Capital Contributions in favor of any other Member.
(2) No Member shall be paid interest on its Capital Account.
(3) No Member shall have the right to demand and receive
property other than cash in return of its Capital Contributions.
LLC Agreement of
Pacific Longline Company LLC - 9
(4) No Member shall have the right to demand and receive
property of the Company in return of its Capital Contributions until the
termination of the Company.
(5) The liability of any Member for the losses, debts,
liabilities and obligations of the Company shall be limited to paying such
Members Capital Contributions when due under the Agreement, its share of any
undistributed assets of the Company, and (only to the extent required by the
Act) any amounts previously distributed to it from the Company.
6. ALLOCATIONS AND DISTRIBUTIONS.
-----------------------------
A. Net Income, Net Loss and Credits.
--------------------------------
Subject to Sections 6E, F, G and H, Net Income, Net Loss and tax
credits shall be allocated among the Members in proportion to their respective
Interests.
B. Funds Available for Distribution.
--------------------------------
All funds available for distribution shall be allocated and
distributed among the Members in proportion to their respective Interests at
such time as the Members shall determine.
C. Gain from Sale.
--------------
Subject to Sections 6E, F, G and H, Gain from Sale shall be
allocated among the Members in the following order of priority:
(1) To the Members who have negative Capital Accounts
immediately preceding the transaction giving rise to the Gain, in proportion to
their negative Capital Accounts, until all negative Capital Accounts have been
increased to zero;
(2) The balance, if any, to the Members in proportion to their
respective Interests.
D. Loss from Sale.
--------------
Subject to Sections 6F and H, Loss from Sale shall be allocated
among the Members in the following order of priority:
(1) To the Members who have positive Capital Accounts
immediately preceding the transaction giving rise to the Loss, in proportion to
their positive Capital Accounts, until each Member's Capital Account is reduced
to zero; and
(2) The balance, if any, to the Members in proportion to their
respective Interests.
LLC Agreement of
Pacific Longline Company LLC - 10
E. Minimum Gain Chargeback.
-----------------------
Notwithstanding anything to the contrary in this Agreement, if
there is a net decrease in the Company's minimum gain for a Company taxable
year, then there shall be allocated to the Members items of Company income and
gain to the extent and subject to the exceptions set forth in the Minimum Gain
chargeback requirements of Regulation Section 1.704-2(f).
F. Allocations to Reflect Book Value/Tax Disparity.
-----------------------------------------------
In accordance with Section 704(c) of the Code and the Regulations
thereunder, income, gain, loss, and deduction with respect to any property
contributed to the capital of the Company shall, solely for tax purposes, be
allocated among the Members so as to take into account any variation between the
adjusted basis of such property to the Company for federal income tax purposes
and its agreed upon fair market value at the time of contribution. In addition,
if Company property is revalued and Capital Accounts are adjusted, then
subsequent allocations of income, gain, loss and deduction for tax purposes with
respect to the revalued property shall take into account variation between the
property's adjusted tax basis and book value in the same manner as under Section
704(c) of the Code and Regulations.
G. Qualified Income Offset.
-----------------------
If a Member unexpectedly receives an adjustment, allocation or
distribution described in Regulation Sections 1.704-l(b)(2)(ii)(d)(4), (5) or
(6) that creates a Modified Negative Capital Account, then items of income or
gain (consisting of a pro rata portion of each item of Company income, including
gross income and gain for such year) shall be allocated to that Member in an
amount and manner sufficient to eliminate, to the extent required by the
Regulations, the Modified Negative Capital Account created by the adjustments,
allocations or distributions as quickly as possible. For purposes of this
subsection G, in determining whether a Member has a Modified Negative Capital
Account, there shall be taken into account those adjustments, allocations and
distributions that, as of the end of the year, are reasonably expected to be
made.
H. Economic Consistency Special Allocations.
----------------------------------------
The special allocations in Sections 6E and G are intended to
comply with the Regulations under Code Section 704(b). Notwithstanding any other
provision of this Section 6, those special allocations shall be taken into
account in computing subsequent allocations of Net Income, Net Loss and Gain or
Loss from Sale (or items thereof) pursuant to this Section 6, so that, to the
extent possible, the net amount of any item so allocated and the Net Income, Net
Loss, and Gain or Loss from Sale and all other items allocated to each Member
pursuant to this Section 6 shall be equal to the net amount that would have been
allocated to each such Member pursuant to this Section 6 if those special
allocations had not occurred.
7. MANAGEMENT.
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LLC Agreement of
Pacific Longline Company LLC - 11
A. Managing Member.
---------------
The Managing Member shall manage and direct the Company's day to
day operation.
B. Management of the Company.
-------------------------
Subject to Section 7C, the Managing Member shall have full charge
of the day to day management of the Vessels in all respects and all matters and
may delegate certain aspects of its duties to one or more agents, employees,
management companies or Members.
C. Major Decision Approval.
-----------------------
Approval of the following major decisions shall require the
approval of Members as set forth in this Section 7C:
(1) Selling or contracting to sell (including the method of
sale) or otherwise disposing of all or substantially all of the Company's assets
or selling the Company shall require the approval of Members holding 80% of the
Interests.
(2) Refinancing the Company indebtedness incurred in acquiring
property or operating the business of the Company shall require the approval of
Members holding 75% of the Interests.
(3) Compensating (pursuant to Section E(l), below) the Managing
Member for its services in managing and directing the day to day operations of
the Vessel shall require approval of Members holding 80% of the Interests.
D. Execution of Documents.
----------------------
(1) Any instrument relating to the day to day operation of the
Vessels may be executed and delivered on behalf of the Company by the Managing
Member and no other signature shall be required for any such instrument to be
valid, binding and enforceable against the Company in accordance with its terms.
Any instrument relating to any other business or business operation of the
Company may be executed and delivered on behalf of the Company by the Managing
Member, upon approval of the Members, including any deed, mortgage, deed of
trust, note or other evidence of indebtedness, lease agreement, security
agreement, financing statement, contract of sale, or other instrument purporting
to convey or encumber, in whole or in part, any or all of the assets of the
Company, at any time held in its name, or any receipt or compromise or
settlement agreement with respect to the accounts receivable and claims of the
Company; and no other signature shall be required for any such instrument to be
valid, binding and enforceable against the Company in accordance with its terms.
All persons may rely thereon and shall be exonerated from any and all liability
if they deal with the Managing Member on the basis of documents approved and
executed on behalf of the Company by the Managing Member,
LLC Agreement of
Pacific Longline Company LLC - 12
PROVIDED, that such person is without reasonable cause to believe that the
Managing Member does not have authority to act for the Company.
(2) Any person dealing with the Company or its Members may rely
upon the certificate signed by the Managing Member as to:
(a) the identity of the Members or Managing Member;
(b) acts by the Members or Managing Member;
(c) any act or failure to act by the Company or as to any
other matter whatsoever involving the Company or any Member.
E. Compensation and Reimbursement of Members and Managing Member.
-------------------------------------------------------------
(1) Except as otherwise determined by those Members holding at
least 80% of the Interests, the Managing Member shall receive no compensation
for its services in managing and directing the day to day operations of the
Vessel.
(2) The Managing Member shall arrange funding to maintain and
operate the Vessels in the Alaska longline fishery and shall be entitled to
reimbursement by the Company for all funds so expended prior to distribution of
any profits to the Members.
(3) The Members shall be entitled to charge to the Company or to
be reimbursed by the Company for all expenses incurred by them in connection
with Company business prior to distribution of any profits to the Members.
F. Valuation of the Company.
------------------------
Within thirty (30) days after the close of each fiscal year of
the Company, the Members shall determine the value of the Company as of the
close of such fiscal year. This value shall be used for purposes of the buy/sell
provisions of Section 13 of this Agreement. In the event the Members fail to
determine the value of the Company after any fiscal year of the Company as
provided in this paragraph and valuation of the Company becomes necessary due to
the buy/sell provisions of Section 13 of this Agreement, the value of the
Company shall be determined by appraisal. Within fifteen (15) days after the
need for the valuation arises, the Members and the legal representative of the
Member whose death, incompetency or bankruptcy results in application of Section
13 of this Agreement shall, collectively, select an appraiser to determine the
value of the Company as of the close of the last fiscal year of the Company
prior to the date on which such valuation is to be applied. The appraiser shall
be directed to determine a valuation within thirty (30) days after notification
of selection and to make such determination without discount for lack of
marketability or minority interest. In the event the Members and such legal
representative cannot agree upon an appraiser within such fifteen (15) day
period, the legal representative shall select an appraiser within fifteen (15)
days after the expiration of the first fifteen (15) day period and the remaining
Member(s), as a group, shall select an appraiser within fifteen (15) days after
the
LLC Agreement of
Pacific Longline Company LLC - 13
expiration of the first fifteen (15) day period. The appraisers shall be
directed to independently determine their valuations within thirty (30) days
after their selection without deduction for lack of marketability or minority
interest and the value to be used for purposes of the buy/ sell provisions of
this Agreement shall be the arithmetic mean of the values determined by such
appraisers. If a single appraiser is used, the cost of the appraiser shall be
borne by the Company. If two appraisers are used, the estate of the deceased,
incompetent, or bankrupt Member shall bear the cost of its appraiser and the
remaining Member(s), as a group, shall bear the cost of its/ their appraiser.
8. AUTHORITY OF THE MEMBERS AND THEIR AFFILIATES TO DEAL WITH THE
--------------------------------------------------------------
COMPANY.
-------
The Members, in their discretion, may engage any person, firm or
corporation in which any Member or any affiliate of a Member may have an
interest, for the performance of any and all services or purchase of goods or
other property which may at any time be necessary, proper, convenient, or
advisable in carrying on the business and affairs of the Company or disposing of
some or all of its assets; provided, however, that the compensation or price
therefor shall not materially exceed that prevailing in arm's length
transactions by others rendering similar services in comparable transactions as
an on-going activity in the same geographical area as the Company's principal
place of business or in the location where the goods or services are provided.
9. AUTHORITY OF THE MEMBERS TO ENGAGE IN OTHER BUSINESSES.
------------------------------------------------------
Any of the Members may engage in and/or possess an interest in other
business ventures of any nature and description, independently or with others,
and neither the Company nor any of the Members shall have any right by virtue of
this Agreement in or to any such venture of another Member or to any income or
profits derived therefrom. Neither a Member nor any affiliate of any Member
shall be obligated to present any particular investment opportunity to the
Company even if such opportunity is of a character which, if presented to the
Company, could be taken by the Company, and each Member shall have the right to
take for its own account (individually or as a trustee) or to recommend to
others any such particular investment opportunity.
10. ACCOUNTS, BOOKS, RECORDS, ACCOUNTING, REPORTS AND TAX MATTERS.
-------------------------------------------------------------
A. Bank Accounts.
-------------
The funds of the Company shall be deposited in the name of the
Company in such bank or savings and loan accounts as may be designated by the
Members, and the Members shall arrange for the appropriate conduct of such
accounts, including the signatures to be required.
B. Books and Records.
-----------------
The Managing Member shall keep or cause to be kept complete and
accurate books of account, in which shall be entered fully and accurately each
and every transaction of the Company, and the records required to be maintained
by the Company pursuant to the Act. The
LLC Agreement of
Pacific Longline Company LLC - 14
Company's books and records shall be maintained at the principal office of the
Company or at such other place as the Members may from time to time designate,
and each Member shall at all reasonable times have access thereto and the right
to inspect and copy for purposes related to the Company's business.
C. Tax Information.
---------------
The Managing Member shall use commercially reasonable efforts to
cause the Company to deliver to each Member within 60 days after the end of each
taxable year the information relating to the Company necessary for the
preparation of the Member's federal income tax return.
D. Tax Elections.
-------------
The Members may make all elections for federal income tax
purposes.
E. Tax Matters Partner.
-------------------
The Managing Member is designated as the "tax matters partner"
for purposes of the Code. The Members may name a substitute or successor at any
time.
11. INDEMNIFICATION AND EXCULPATION OF MEMBERS.
------------------------------------------
A. Indemnification.
---------------
The Members shall be indemnified and held harmless by the Company
from any liability resulting from any act performed by or omission made by the
Members on behalf of the Company to the fullest extent permitted under Chapter
25.15 of the Revised Code of Washington, as amended.
B. Exculpation.
-----------
The Members shall not be liable to the Company or to any Member
for or as a result of any act, omission or error in judgment that was taken,
omitted or made by the Member in accordance with the standards established by
Section 25.15.040 of the Act. In any proceeding brought in the right of the
Company or brought by or on behalf of Members of the Company, a Member shall
have no liability for damages other than for willful misconduct or a knowing
violation of the law.
12. ASSIGNABILITY OF COMPANY INTERESTS.
----------------------------------
A. Limitations.
-----------
No Member may withdraw or resign from the Company, nor may any Member make a
Disposition of all or any part of its Interest without first complying with the
terms of this
LLC Agreement of
Pacific Longline Company LLC - 15
Agreement. Notwithstanding the foregoing, American Seafoods may transfer all of
its Interest in connection with any transaction in which all or substantially
all of the assets of American Seafoods Limited Partnership are sold,
transferred, or refinanced, provided that the assignee of such Interest agrees
to be bound by the terms of this Agreement.
B. Substituted Members.
-------------------
(1) Unless named in this Agreement or admitted as provided in
subsection (2), no person shall be considered a Member; the Company, each
Member, and any other person having business with the Company need deal only
with Members so named and so admitted. They shall not be required to deal with
any other person by reason of any Disposition by a Member or by reason of the
death or termination of a Member, except as otherwise provided in this
Agreement. In the absence of substitution of a Member for an assigning, deceased
or terminated Member, any payment by the Company to a Member, or to its
successors, executors or administrators, shall acquit the Company of all
liability to any other person who may be interested in such payment by reason of
an assignment by the Member or by reason of its death or termination.
(2) An assignee may become a substituted Member in place of its
assignor or predecessor in interest only if all of the following conditions are
satisfied:
(a) The instrument of assignment sets forth the intention
of the assignor that the assignee shall become a substituted Member in place of
the assignor with respect to the assignor's Interest.
(b) The assignor and assignee shall execute and deliver
such other instruments as the Members may require, including written acceptance
by the assignee of the terms of the Agreement and the power of attorney in such
form as may be presented pursuant to Section 18.
(c) The written consent of all of the other Members to the
substitution shall have been obtained, which may be granted or withheld in the
absolute discretion of each Member.
(d) The assignee shall have paid all reasonable fees and
costs incurred by the Company in connection with substitution as a Member, as
determined by the Members.
C. Transfer of Interest.
--------------------
(1) In the event that a Member wishes to terminate its Interest
in the Company (the "Initiating Member"), it shall determine a price and terms
for its Interest and give written notice of such price and terms to the
remaining Members. The terms shall include a minimum downpayment of twenty
percent (20%) of the price.
LLC Agreement of
Pacific Longline Company LLC - 16
(2) The remaining Members shall have the option to buy their
proportionate share of the Interest of the Initiating Member or to sell their
Interest in the Company to the Initiating Member at the price and on the terms
set forth in the Initiating Member's notice, PROVIDED that a remaining Member
who wishes to buy its proportionate share of the Initiating Member's Interest
may extend the period for payment of the purchase price to a maximum of six (6)
months, notwithstanding that the Initiating Member set forth a shorter period in
its notice.
D. Sale of the Company.
-------------------
In the event that a third party makes an offer to acquire the
entire Company, but any Member holding less than a majority of the Interests
does not wish to sell its Interest, such Member shall have the right of first
refusal to acquire the Company on the same terms and conditions proposed by the
third party, by paying that portion of the proposed purchase price that bears
the same relation to the total purchase price as the Interests of the Members
who wish to sell their Interests bear to the total Interests in the Company.
13. DISSOLUTION OR BANKRUPTCY OF A MEMBER.
-------------------------------------
A. Dissolution.
-----------
(1) Upon the dissolution of a member, the remaining Members
shall purchase their proportionate share of the Interest of the dissolved
Member.
(2) The purchase price of the Interest of the dissolved Member
shall be the value of the Company determined pursuant to Section 7F multiplied
by the Interest held by the dissolved Member at the date of dissolution.
(3) The purchase price shall be payable as follows:
(a) Twenty-five percent (25%) shall be paid as a
downpayment.
(b) The balance shall be paid in three (3) equal payments
over three (3) calendar quarters, with the first payment due three (3) months
from the date that the downpayment is paid. The unpaid balance shall bear
interest at the rate of eight percent (8%) per annum from the same date.
B. Incompetency or Bankruptcy.
--------------------------
(1) Upon the Bankruptcy of a Member ("Terminating Member"), the
remaining Members shall purchase their proportionate share of the Interest of
the Terminating Member.
(2) The purchase price shall be as determined under Section
13A(2).
LLC Agreement of
Pacific Longline Company LLC - 17
(3) The purchase price shall be payable over a period of time to
be negotiated by the remaining Members and the Successor-in-Interest of the
Terminating Member, but such period shall be not less than three (3) years nor
more than five (5) years. The purchase price shall bear interest at the rate of
eight percent (8%) per annum.
14. TERMINATION.
-----------
A. Events Causing Dissolution and Winding Up.
-----------------------------------------
Any of the following events shall cause the dissolution and
winding up of the Company:
(1) Consent in writing by the Members.
(2) The sale or other disposition of all or substantially all of
the assets of the Company.
(3) Expiration of the term set forth in Section 1B.
(4) Any other event causing dissolution under the Act unless all
of the remaining Members agree to continue the business of the Company pursuant
to Section 14B.
B. Election to Continue Company.
----------------------------
An event set forth in Section 14A(4) shall not result in the
dissolution, winding up and termination of the Company if, within ninety (90)
days after the occurrence of that event, the remaining Members elect by
unanimous written consent to continue the Company.
C. Winding Up Company Affairs.
--------------------------
(1) Upon the occurrence of any of the events specified in
Section 14A(l) - (3) or the events specified in Section 14A(4) and the failure
of the Members to continue the business under Section 14B, the Members shall
wind up the affairs of the Company. After the payment of, or provisions for, all
debts of the Company, the proceeds of the sale of the Company assets or the
Company assets shall be distributed to the Members or their
Successor-in-Interest pro rata in accordance with their positive Capital
Accounts. If any assets are distributed in kind, they shall be distributed on
the basis of the fair market value for purposes of the allocations under Section
6. Unless the Members otherwise agree, there shall be distributed to the Members
as tenants-in-common an undivided interest in the assets equal to the
distributions to which they are entitled under Section 6.
(2) If the Company is "liquidated" within the meaning of
Regulation Section 1.704-l(b)(2)(ii)(g), then the liquidating distributions
shall be made by the later of (i) the end of the Company taxable year in which
liquidation occurs, or (ii) ninety (90) days after the date of liquidation.
LLC Agreement of
Pacific Longline Company LLC - 18
(3) The Company shall terminate when all assets of the Company
have been sold and/or distributed and all affairs of the Company have been wound
up.
15. AMENDMENTS.
----------
A. General Amendments.
------------------
Except as provided in Section 15B, this Agreement may be amended
by the Members in any manner with the approval of Members holding a majority of
the Interests.
B. Changes Affecting Members.
-------------------------
Notwithstanding Section 15A, any amendment to this Agreement that
would adversely affect the federal income tax treatment to be afforded a Member,
adversely affect the liabilities of a Member, modify any consent and approval
rights reserved by the Members or change the method of allocation of Net Income
or Net Loss, Gain or Loss from Sale, or the distribution of funds available for
distribution as provided in Section 6 and 14, shall require the approval of the
Member affected; provided, however, that the Members are authorized to modify
Section 6, without the consent of the Members affected, if, upon advice of
counsel for the Company, the modification is necessary to cause the allocations
under Section 6 to have substantial economic effect or to be in accordance with
the Members' interests under Section 704 of the Code and the most recently
proposed or final Regulations thereunder, so long as the modification does not,
by its terms, alter the limited liability of the Members and provided that the
modification is not likely to have a material effect on the amounts
distributable to any Member pursuant to this Agreement.
16. MISCELLANEOUS.
-------------
A. Governing Law.
-------------
This Agreement and the rights and liabilities of the parties
shall be determined in accordance with the laws of Washington.
B. Captions.
--------
Captions contained in this Agreement are inserted only as a
matter of convenience and in no way define, limit, extend or describe the scope
of this Agreement or the intent of any provisions hereof.
C. Construction.
------------
Whenever the context may require, any pronouns used herein shall
include the corresponding masculine, feminine or neuter forms, and the singular
form of nouns and pronouns shall include the plural and vice versa.
LLC Agreement of
Pacific Longline Company LLC - 19
D. Survival of Representations and Warranties.
------------------------------------------
All representations and warranties herein shall survive until the
termination of the Company, except to the extent that a representation or
warranty expressly provides otherwise.
E. Severability.
------------
Every provision of this Agreement is intended to be severable. If
any term or provision hereof is illegal or invalid for any reason whatsoever,
such illegality or invalidity shall not affect the validity of the remainder of
the terms or provisions within this Agreement.
F. Successors.
----------
Subject to the limits on transferability contained herein, each
and all of the covenants, terms, provisions and agreements herein contained
shall be binding upon and inure to the benefit of the successors, heirs, and
assigns of the respective parties.
G. Execution and Counterparts.
--------------------------
This Agreement and any amendments may be executed in multiple
counterparts, each of which shall be deemed an original and all of which
together shall constitute one agreement. In addition, this Agreement and any
amendments may be executed through the use of counterpart signature pages. The
signature of any party on any counterpart agreement or counterpart signature
page shall be deemed to be a signature to, and may be appended to, one document.
H. Entire Agreement.
----------------
This Agreement embodies the entire agreement and understanding
between the Members with respect to the subject matter hereof, and supersedes
all prior agreements and understandings between such Members relating to the
subject matter hereof. No amendment, modification, termination or waiver of any
provision of this Agreement shall be effected unless the same shall be set forth
in writing signed by Members holding a majority of the Interests, subject to the
provisions of Section 15B.
17. NOTICES.
-------
A. Addresses.
---------
Each Member shall keep the other Members and the Company informed
of its current address. The addresses furnished by the Members shall be kept on
file at the Company's principal place of business.
B. Communications.
--------------
LLC Agreement of
Pacific Longline Company LLC - 20
Any notice, payment, demand, consent, or communication required
or permitted to be given by this Agreement shall be in writing and shall be
deemed to have been sufficiently given or served for all purposes if delivered
personally to the party or to an officer of the party to whom it is directed or
if sent by registered or certified mail, postage and charges prepaid, addressed
to the address contained in the records of the Company.
C. Effective Date.
--------------
Any such notice shall be deemed to be given on the date on which
it was delivered personally or deposited in a regularly maintained receptacle
for the deposit of United States mail, addressed as set forth above. Any Member
may change the address of that party for purposes of this Agreement by giving
the other Members notice of such change in the manner set forth above.
18. MANAGING MEMBER AS ATTORNEY-IN-FACT.
-----------------------------------
A. Appointment of Managing Member as Attorney-In-Fact.
--------------------------------------------------
Each Member irrevocably constitutes and appoints, with full power
of substitution, the Managing Member as its true and lawful attorney-in-fact
with full power and authority in its name, place and stead to execute, certify,
acknowledge, deliver, swear to, file and record at the appropriate public
offices such documents as may be necessary or appropriate to carry out the
provisions of this Agreement, including but not limited to:
(1) All certificates and other instruments (including
counterparts of this Agreement), and any amendment thereof, which the Managing
Member deems appropriate to form, qualify or continue the Company as a limited
liability company;
(2) Any other instrument or document which may be required to be
filed by the Company under the laws of any state or which the Managing Member
deems advisable to file;
(3) All amendments to this Agreement adopted in accordance with
the terms hereof and all instruments which the Members deem appropriate to
reflect a change or modification of the Company in accordance with this
Agreement; and
(4) Any instrument or document, including amendments to this
Agreement, which may be required to effect the continuation of the Company, the
admission of a substituted Member or an additional Member (including a power of
attorney granted to the Managing Member by a transferee of a Member's Interest
pursuant to this Section 18), or the dissolution and termination of the Company
(provided the continuation, admission or dissolution and termination are in
accordance with this Agreement).
B. Irrevocable Appointments.
------------------------
LLC Agreement of
Pacific Longline Company LLC - 21
The appointment by each Member of the Managing Member as its
attorney-in-fact is irrevocable and shall be deemed to be a power coupled with
an interest and shall survive the Bankruptcy, disability or incompetence of any
person giving such power and the transfer or assignment of all or any part of
the Interest of such person; provided, however, that in the event of the
transfer by a Member of all or any part of its Interest, the power of attorney
of a transferor Member shall survive such transfer only until such time, if any,
as the transferee shall have been admitted to the Company as a substituted
Member and all required documents and instruments shall have been duly executed,
filed and recorded to effect such substitution.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the day and year first above written.
MEMBERS:
-------
ALEUTIAN SPRAY FISHERIES, INC.
By /s/
-------------------------------------
Its
-------------------------------------
AMERICAN SEAFOODS GROUP LLC
By /s/
-------------------------------------
Its
-------------------------------------
/s/ Webjorn Eikrem
-------------------------------------
Webjorn Eikrem
LLC Agreement of
Pacific Longline Company LLC - 22