SECOND AMENDED and RESTATED OPERATING AGREEMENT of HUSKER AG, LLC a Nebraska limited liability company THIS OPERATING AGREEMENT CONTAINS RETRICTIONS ON TRANSFERABILITY OF MEMBERSHIP INTERESTS
SECOND
AMENDED
and
RESTATED
of
HUSKER
AG, LLC
a
Nebraska limited liability company
THIS
OPERATING AGREEMENT
CONTAINS
RETRICTIONS ON TRANSFERABILITY OF
MEMBERSHIP
INTERESTS
1
Husker
Ag, LLC
SECOND
AMENDED
and
RESTATED
THIS
SECOND AMENDED AND RESTATED OPERATING AGREEMENT (this
“Agreement”)
is
made and entered into as of April 30, 2001 by Husker Ag, LLC (the
“Company”),
a
Nebraska limited liability company.
In
consideration of the mutual covenants contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE
1
DEFINITIONS
As
used
in this Agreement, the following terms shall have the following
meanings:
1.1 "Act"
shall
mean the Nebraska Limited Liability Company Act, as amended from time to
time.
1.2 “Affiliate"
shall
mean, in the case of any Person (the "Specified
- Person"),
any
other Person (a) that directly, or indirectly through one or more
intermediaries, controls, is controlled by or is under common control with
the
Specified Person, or (b) that is an executive officer, director or manager,
or
serves in a similar capacity with respect to, the Specified Person, as
determined by the Board of Directors in its sole discretion based on facts
and
information available to the Board.
1.3 "Agreement"
shall
mean this Operating Agreement, as originally executed or as amended, modified,
supplemented or restated from time to time.
1.4 "Capital
Account Balance"
shall
have the meaning set forth in Section 5.1.
1.5 "Capital
Contribution"
shall
mean, in the case of any Member as of any date of determination, the aggregate
amount of cash, property, or services rendered, or a promissory note or other
binding obligation to contribute cash or property or to perform services
that
such Member shall have contributed to the Company on or prior to such date
and a
Member's share of any of the Company's liabilities as determined in accordance
with the Code and Treasury Regulations (or, if such Member is not the original
holder of the Interest of such Member, the Capital Contribution with respect
to
the Interest). In the event that any capital is returned to a Member, such
Member's Capital Contribution shall be adjusted to reflect such
return.
1.6 "Code"
shall
mean the Internal Revenue Code of 1986, as amended from time to time and
any
successor statute or subsequent codification or recodification of the federal
income tax laws of the United States.
1.7 "Company"
shall
mean Husker Ag, LLC, a Nebraska limited liability company, as such limited
liability company may from time to time be constituted, or any successor
in
interest for such limited liability company.
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1.8 "Distribution"
shall
mean any distribution pursuant to Section 5.8 by the Company of cash to the
Members or any Distribution in Kind.
1.9 "Distribution
in Kind"
shall
have the meaning set forth in paragraph(b) of Section 5.8.
1.10 "Interest"
shall
mean, in the case of any Member at any time, such Member's share of the Profits
and Losses of the Company at such time and the right of such Member to receive
distributions of Company assets to which such Member may be entitled as provided
in this Agreement and applicable law, and the right of such Member to vote
and
participate in the management of the Company as provided in this
Agreement.
1.11 "Losses"
shall
mean the net losses and deductions of the Company determined in accordance
with
accounting principles consistently applied from year to year employed under
the
method of accounting adopted by the Company and as reported separately or
in the
aggregate, as appropriate, on the tax return of the Company filed for federal
income tax purposes.
1.12 "Director"
shall
mean one or more Persons designated by the Members to be members of the Board
of
Directors. The “Board
of Directors”
or
“Board”
shall
manage the Company as provided in Article 6.
1.13 "Majority
in Interest"
shall
mean the affirmative vote of those Members holding more than fifty percent
(50%)
of the Percentage Interests. With respect to the Board, “Majority
of the Board”
shall
mean the affirmative vote of more than fifty percent (50%) of the
Directors.
1.14 "Member"
shall
mean any Person who, at the time referenced, owns an Interest in the
Company.
1.15 “Officer”
shall
mean a Member or other Person designated by the Board or Members as provided
in
Section 6.11.
1.16 "Person"
shall
mean an individual, a partnership, a joint venture, a corporation, a limited
liability company, a trust, an estate, an unincorporated organization or
any
other entity or a government or any department or agency thereof.
1.17 "Percentage
Interest"
means
the percentage figure calculated by dividing the
number of Units owned by the Member by the total number of Units
outstanding.
1.18 "Pro
Rata"
means
the ratio computed by dividing the Units of each Member to whom a particular
provision of this Agreement is stated to apply by the aggregate of the Units
of
all Members to whom that provision is stated to apply.
1.19 "Profits"
shall
mean the net income and gains of the Company determined in accordance with
accounting principles consistently applied from year to year employed under
the
method of accounting adopted by the Company and as reported separately or
in the
aggregate, as appropriate, on the tax return of the Company filed for federal
income tax purposes. Profits includes taxable income, capital gain, and income
exempt from taxation.
1.20 “Publicly
Traded Partnership”
shall
mean a partnership whose interests are traded on an established securities
market, or are readily tradable on a secondary market (or the substantial
equivalent thereof).
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1.21 “Qualified
Matching Service Program”
shall
mean a matching service that satisfies the requirements of a qualified matching
service within the meaning of Treasury Regulation Section 1.7704-1(g)(2),
as
amended from time to time, during limited time periods specified and approved
by
Board from time to time, in its sole discretion.
1.22 "Super-Majority
Vote"
or
“Two-Thirds
Majority”
shall
mean the affirmative vote of those Members holding more than Two-Thirds (2/3)
of
the Percentage Interests. With respect to the Board, “Super-Majority
Vote”
or
“Two-Thirds
Majority”
shall
mean the affirmative vote of more than two-thirds (2/3) of the Directors.
1.23 "Transfer"
or
derivations thereof, of a Unit or Interest means, as a noun, the sale,
assignment, exchange, pledge, hypothecation or other disposition of a Unit
or
Interest, or any part thereof, directly or indirectly, or the sale, assignment,
exchange, pledge, hypothecation, or other disposition of a controlling interest
in the equity securities of a Member, and as a verb, voluntarily to transfer,
sell, assign, exchange, pledge, hypothecate or otherwise dispose
of.
1.24 "Treasury
Regulations"
shall
mean the regulations of the United States Department of the Treasury pertaining
to the income tax, as from time to time in force.
1.25 "Units"
means
equal units of the entire ownership interest of all Members of the Company,
and
all rights and liabilities associated therewith, at any particular time,
including, without limitation, rights to distributions (liquidating or
otherwise), allocations, information, and consent or approve.
1.26 "Value"
shall
mean, with respect to any Distributions, if cash, the amount of such cash,
or if
not cash, the value of such Distribution calculated pursuant to paragraph
(d) of
Section 5.8.
ARTICLE
II
STRUCTURE
OF THE COMPANY
2.1 Formation.
The
parties to this Agreement have organized a limited liability company under
the
provisions of the Act by delivering Articles of Organization to the Secretary
of
State of the State of Nebraska for filing. The Board may take such further
actions as it deems necessary or advisable to permit the Company to conduct
business as a limited liability company in any jurisdiction. The rights and
liabilities of the Members under this Agreement shall be as provided by Nebraska
law.
2.2 Name.
The
name of the Company shall be Husker Ag, LLC, or any other name permitted
by the
Act as the Members shall afterwards designate by appropriate amendment to
the
Company's Articles of Organization.
2.3 Principal
Office.
The
principal office of the Company shall be at ▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or such place as the Members may, from time to time, designate
by
appropriate amendment to the Company's Articles of Organization. The Board
may
establish additional places of business for the Company when and where required
by the business of the Company.
2.4 Names
and Addresses of Members.
The
names, addresses, Capital
Contributions and number of Units held by the initial Members of the Company
are
set forth on Appendix A.
2.5 Membership
Units and Register.
Ownership
rights in the Company are evidenced by Units. The Company shall maintain
a
membership register (the “Membership
Register”)
at its
principal office or by a duly appointed agent of the Company setting forth
the
name,
address, Capital Contributions and number of Units held by each Member which
shall be modified from time to time as Transfers occur or as additional Units
are issued to new or existing Members pursuant to the provisions of this
Agreement.
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2.6 Fiscal
Year.
The
fiscal year of the Company shall begin on January 1 and end on December 31
of
each year. The Board may change the Company’s fiscal year upon the affirmative
vote of a Majority of the Board. The fiscal year in which the Company shall
terminate shall end on the date of termination of the Company.
2.7 No
Partnership.
The
Directors and the Members intend that as a result of this Agreement: (i)
the
Company not be a partnership (including, without limitation, a limited
partnership) or joint venture for any purposes other than federal and state
tax
purposes, (ii) no Member or Director be a partner or joint venturer of any
other
Member, for any purposes other than federal and state tax purposes, and (iii)
this Agreement may not be construed to suggest otherwise. This Section 2.7
does
not prohibit any Member or Director, in his individual or independent capacity,
from being associated with another Member or another Person.
2.8 Intent
of this Agreement.
(a) The
parties to this Agreement have reached an understanding concerning various
aspects of (i) their business relationship with each other and (ii) the
organization and operation of the Company and its business. They wish to
use
rights created by statute to record and bind themselves to that
understanding.
(b) The
parties intend for this Agreement to control, to the extent stated or fairly
implied, the business and affairs of the Company, including the Company’s
governance structure and the Company’s dissolution and winding up, as well as
the relations among the Company’s Members.
2.9 Advice
of Counsel.
Each
Person signing this Agreement: (a) understands that this Agreement contains
legally binding provisions; (b) has had the opportunity to consult with that
Person’s own lawyer; and (c) has either consulted that lawyer or consciously
decided not to consult a lawyer.
ARTICLE
III
BUSINESS
OF THE COMPANY
The
Company may engage in any lawful business, other than banking or insurance.
The
Agreement shall be construed in light of such purpose.
ARTICLE
IV
CAPITAL
CONTRIBUTIONS
4.1 Initial
Paid-In Capital.
The
Members listed on Appendix A shall have contributed the cash to the capital
of
the Company as set forth therein. Capital Contributions for new Members accepted
by the Board, from time to time, shall be made by each new Member as determined
by the Board in its sole discretion.
4.2 Additional
Capital Contributions.
No
Member
shall be required to make any additional contributions to the capital of
the
Company. No Member shall be obligated to satisfy any negative Capital Account
Balance, except to the extent expressly set forth herein or in the Articles
of
Organization. No
Member
shall be paid interest on any Capital Contribution.
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4.3 Minimum
Transfers and Maximum Ownership.
(a) Beginning
August 31, 2005, (i) no Member shall Transfer fewer than five (5) Units to
any
transferee (except in the case where all Units owned by a Member are transferred
to a single transferee); and (ii) no Member shall Transfer any Units that
would
result in the transferor owning fewer than five (5) Units after the Transfer.
Any Member that wishes to make such a Transfer may request the Company to
redeem
the affected Units pursuant to Sections 10.7 and 10.8 of this Agreement.
For
this purpose, the affected Units shall include any Units intended to be
transferred or retained by the transferor in an amount of fewer than five
(5)
Units.
(b) No
Member
together with its Affiliates shall own Percentage Interests in the Company
in
excess of thirty percent (30%).
4.4 Withdrawal
or Reduction of Members' Capital Contributions.
The
withdrawal or reduction of Members' contributions to the capital of the Company
shall be governed by Section 21-2619 of the Act, as amended from time to
time;
provided,
however:
(a) No
Member
has the right to withdraw all or any part of his Capital Contribution or
to
receive any return on any portion of his Capital Contribution, except as
may be
otherwise specifically provided in this Agreement. Under circumstances involving
a return of any Capital Contribution, no Member has the right to receive
property other than cash.
(b) No
Member
shall have priority over any other Members, either as to the return of Capital
Contributions or as to Losses and Profits, or distributions, except as otherwise
provided herein.
4.5 Loans
from Directors and Members.
The
Company may borrow money from and enter into other transactions with any
Director or Member. Borrowing from or engaging in other transactions with
one or
more Directors or Members does not obligate the Company to provide comparable
opportunities to other Directors or Members. Any loan made by a Director
or
Member to the Company shall be evidenced by a promissory note made payable
from
the Company to such Director or Member. Loans
by
a Director or Member to the Company shall not be considered Capital
Contributions and shall be repaid pursuant to Section 5.8(a) below.
4.6 Loans
by Company to Members.
Unless
otherwise approved by the Board of Directors, the Company will not make any
loans to Members. Notwithstanding the foregoing or anything in this Agreement
to
the contrary, the Company shall not, directly or indirectly, including through
any subsidiary, extend or maintain credit, arrange for the extension of credit,
or renew an extension of credit, in the form of a personal loan to or for
any
Director or Officer of the Company.
ARTICLE
V
ALLOCATIONS
AND DISTRIBUTIONS
5.1 Capital
Accounts.
A
“Capital
Account”
shall
be established for each Member on the books of the Company and maintained
in
accordance with Section 1.704-1(b)(2) of the Treasury Regulations, as amended
from time to time.
(a) To
each
Member's Capital Account there shall be credited:
(i) the
cash
and the Value of any property other than cash contributed by such Member
to the
capital of the Company;
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(ii) such
Member's allocable share of Profits, and any items of income or gain which
are
specially allocated to the Member; and
(iii) the
amount of any Company liabilities assumed by such Member of which are secured
by
any property of the Company distributed to such Member.
The
principal amount of a promissory note which is not readily traded on an
established securities market and which is contributed to the Company by
the
maker of the note shall not be credited to the Capital Account of any Member
until the Company makes a taxable disposition of the note or until (and only
to
the extent) principal payments are made on the note.
(b) To
each
Member's Capital Account there shall be debited:
(i) the
amount of cash and the Value of any property other than cash distributed
to such
Member pursuant to Section 5.8;
(ii) such
Member's allocable share of Losses and any items of expense or loss which
are
specially allocated to the Member; and
(iii) the
amount of any liabilities of such Member assumed by the Company or which
are
secured by any property contributed by such Member to the Company.
Provided;
however,
all of
the foregoing to be determined in accordance with the rules set forth in
Section
1.704-1(b)(2)(iv) of the Treasury Regulations, as amended from time to
time.
5.2 Allocations
and Distributions.
Except
as may be required by section 704 (b) and (c) of the Code and the applicable
Treasury Regulations or under Section 5.5 below, all items of income, gain,
loss, deduction, and credit of the Company shall be allocated among the Members,
and distributions shall be made, in accordance with this Article 5.
5.3 Allocations
of Income, Gain, Loss, Deductions, and Credits.
All
items of income, gain, loss, deductions, and credits for a fiscal year shall
be
allocated to the Members ratably in proportion to their Percentage Interests.
5.4 Allocation
of Gain or Loss Upon the Sale of All or Substantially All of the Company's
Assets.
(a) Allocation
of Gain.
Any
income or gain from the sale or exchange of all or substantially all of the
Company's assets shall be allocated, first, to those Members with capital
account balances less than the amounts of their respective Capital Contributions
that have not previously been distributed, that amount of income or gain,
if
any, necessary to increase their capital account balances to the amount of
their
Capital Contributions not previously distributed; and thereafter, the remaining
income or gain, if any, shall be allocated to the Members, ratably in proportion
to their Percentage Interests.
(b) Allocation
of Loss.
Any loss
from the sale or exchange of all or substantially all of the Company's assets
shall be allocated, first, so as to equalize the capital account balances
of all
Members holding the same number of Units, and thereafter, the remaining losses
shall be allocated to the Members, ratably in proportion to their Percentage
Interests.
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5.5 Regulatory
Allocations and Allocation Limitations.
Notwithstanding the preceding provisions for allocating income, gains, losses,
deductions and credits, the following limitations, regulatory allocations
and
contingent reallocations are intended to comply with applicable income tax
Treasury Regulations under Section 704(b) of the Code and shall be so construed
when applied. The defined terms used below shall have the meaning set forth
in
the applicable section of the Code or Treasury Regulations and the terms
“Member” and “Company” shall mean “partner” and “partnership” with respect to
this application of such definitions to this section.
(a) Company
Minimum Gain Chargeback.
Notwithstanding any other provision of this Section 5.5, if there is a net
decrease in Company Minimum Gain during any Company fiscal year, each Member
shall be specially allocated items of Company income and gain for such year
(and, if necessary, for subsequent years) in accordance with Section
1.704-2(f)(1) of the Treasury Regulations in an amount equal to such Member's
share of the net decrease in Company Minimum Gain (determined in accordance
with
Section 1.704-2(g)(2) of the Treasury Regulations). This Section 5.5(a) is
intended to comply with the minimum gain chargeback requirement in the Treasury
Regulations and shall be interpreted consistently therewith.
(b) Member
Minimum Gain Chargeback.
Except
as otherwise provided in Section 1.704-2(i)(4) of the Treasury Regulations,
notwithstanding any other provision of this Section 5.5, if there is a net
decrease in Member Nonrecourse Debt Minimum Gain attributable to a Member
Nonrecourse Debt during any Company fiscal year, each Member who has a share
of
the Member Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse
Debt, determined in accordance with Section 1.704-2(i)(5) of the Treasury
Regulations, shall be specially allocated items of Company income and gain
for
such year (and, if necessary, for subsequent years) in an amount equal to
such
Member's share of the net decrease in Member Nonrecourse Debt Minimum Gain
attributable to such Member Nonrecourse Debt, determined in accordance with
Section 1.704-2(i)(4) of the Treasury Regulations. Allocations pursuant to
the
previous sentence shall be made in proportion to the respective amounts required
to be allocated to each Member pursuant thereto. The items to be so allocated
shall be determined in accordance with Sections 1.704-2(i)(4) and 1.704-2(j)(2)
of the Treasury Regulations. This Section 5.5(b) is intended to comply with
the
minimum gain chargeback requirements in Section 1.704-2(i)(4) of the Treasury
Regulations and shall be interpreted consistently therewith.
(c) Qualified
Income Offset.
In the
event a deficit balance in a Member's capital account in excess of the sum
of
(i) the amount such Member is obligated to restore or contribute to the Company
pursuant to any provision of this Operating Agreement and (ii) the amount
such
Member is deemed to be obligated to contribute pursuant to the penultimate
sentences of Section 1.704-2(g)(1)(ii) and 1.704-2(i)(5) of the Treasury
Regulations, is caused or increased because a Member receives an adjustment,
allocation, or distribution described in Section 1.704-1(b)(2)(ii)(d) of
the
Treasury Regulations, such Member will be allocated items of Company income
and
gain in an amount and manner sufficient to eliminate such deficit balance
or
such increase in the deficit balance, as quickly as possible, to the extent
required in the Treasury Regulations. This Section 5.5(c) is intended, and
shall
be so construed, to provide a "qualified income offset" within the meaning
of
Section 1.704-1(b)(2)(ii)(d) of the Treasury Regulations.
(d) Gross
Income Allocations.
In the
event that a deficit balance in a Member's Capital Account at the end of
any
fiscal year is in excess of the sum of (i) the amount such Member is obligated
to restore or contribute to the Company under this Operating Agreement and
(ii)
the amount such Member is deemed to be obligated to restore pursuant to the
penultimate sentences of Treasury Regulations §§ 1.704-2(g)(1)(ii) and
1.704-2(i)(5), the Member shall be specially allocated items of Company income
and gain in the amount of such excess as quickly as possible, provided that
an
allocation pursuant to this Section 5.5(d) shall be made only if and to the
extent that the Member would have a deficit balance in its Capital Account
in
excess of such sum after all other allocations provided for in this Section
have
been made as if Section 5.5(c) and this Section 5.5(d) were not in this
Operating Agreement.
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(e) Nonrecourse
Deductions.
Nonrecourse Deductions shall be specially allocated to the Members in proportion
to the allocation of Losses under Section 5.4.
(f) Member
Nonrecourse Deductions.
Any
Member Nonrecourse Deductions for any fiscal year shall be specially allocated
to the Member who bears the economic risk of loss with respect to the Member
Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable
in
accordance with Section 1.704-2(i)(1) of the Treasury Regulations.
(g) Members'
Shares of Excess Nonrecourse Debt.
The
Members' shares of excess Company Nonrecourse Debt within the meaning of
Section
1.752-3(a)(3) of the Treasury Regulations shall be determined in accordance
with
the manner in which it is reasonably expected that the deductions attributable
to such Company Nonrecourse Debt will be allocated.
(h) Curative
Allocations.
The
allocations set forth in subsections (a), (b), (d), and (d) (the "Regulatory
Allocations") are intended to comply with certain requirements of the Treasury
Regulations under Section 704(b). Notwithstanding any other provision of
this
Article 5 (other than the Regulatory Allocations), the Regulatory Allocations
shall be taken into account in allocating other items of income, gain or
loss
among the Members so that, to the extent possible, the net amount of allocations
of such items of income, gain or loss and the Regulatory Allocations to each
Member shall be equal to the net amount that would have been allocated to
such
Member if the Regulatory Allocations had not occurred. For this purpose,
future
Regulatory Allocations under Section 5.5(a) and (b) shall be taken into account
that, although not yet made, are likely to offset other Regulatory Allocations
made under Section 5.5(f) and (g).
5.6 Proration
of Allocations.
All
income, gains, losses, deductions and credits for a fiscal year allocable
with
respect to any Members whose Units may have been transferred, forfeited,
reduced
or changed during such year should be allocated based upon the varying interests
of the Members throughout the year. The precise manner in which such allocations
are made shall be determined by the Board of Directors in its sole discretion
and shall be a manner of allocation, including an interim closing of the
books,
permitted to be used for federal income tax purposes.
5.7 Consent
to Allocation.
Each
Member expressly consents to the methods provided herein for allocation of
the
Company's income, gains, losses, deductions and credits.
5.8 Distributions.
(a) The
Board
of Directors shall determine, in its sole discretion, whether to distribute
or
retain all or any portion of the Profits. The Directors may distribute cash
to
the Members irrespective of Profits. All cash distributions shall be made
to the
Members in accordance with paragraph (c) of this Section 5.8.
Provided,
however,
no
Member has a right
to any
distribution prior to the dissolution of the Company without the approval
of the
Board.
(b) The
Board
may agree to distribute to the Members in kind any property held by the Company.
Any such distribution of property shall be referred to herein as a "Distribution
in Kind."
The
value of any such Distribution in Kind at the time of such distribution shall
be
determined in accordance with paragraph (d) of this Section 5.8
and
such distribution shall be made to the Members in accordance with
paragraph (c) of this Section 5.8. Distributions in Kind, made
pursuant to this paragraph (b), shall be subject to such restrictions
and
conditions as the Board shall have determined are necessary or appropriate
in
order for such distributions to be made in accordance with applicable
law.
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(c) Any
distribution of Profits in accordance with this Section 5.8, and any
distribution, other than Profits, of cash pursuant to paragraph (a)
of this
Section 5.8 or Distribution in Kind pursuant to paragraph (b)
of
Section 5.8, shall be made to the Members according to their Percentage
Interests.
(d) The
Value
of any Distribution in Kind as of any date of determination (or in the event
such date is a holiday or other day that is not a business day, as of the
next
preceding business day) shall be the estimated fair market value of any property
distributed, as determined by the Board of Directors in its sole
discretion.
(e) All
distributions are subject to set-off by the Company for any past-due obligation
of the Members to the Company.
(f) Members
shall not receive salaries or compensation from the Company solely in their
capacities as Members or for the use of their capital.
5.9 Other
Allocation Rules.
For
purposes of determining the Profits, Losses, or any other items allocable
to any
period, Profits, Losses and any such other items shall be determined on a
daily,
monthly, or other basis, as determined by the Board, using any permissible
method under Section 706 of the Code and the Treasury Regulations
thereunder.
5.10 Compliance
with Section 704(b) of the Code.
The
provisions of this Article as they relate to the maintenance of Capital Accounts
are intended, and shall be construed, and, if necessary, modified to cause
the
allocations of profits, losses, income, gain and credit pursuant to Article
V to
have substantial economic effect under the Treasury Regulations promulgated
under Section 704(b) of the Code, in light of the distributions made pursuant
to
Articles V and XI and the contributions made pursuant to Article IV.
Notwithstanding anything herein to the contrary, this Agreement shall not
be
construed as creating a deficit restoration obligation or otherwise personally
obligate any Member or Transferee to make a contribution in excess of the
initial contribution or additional contribution agreed to by a Majority in
Interest of the Members of the Company.
5.11 Transfer
of Capital Accounts.
In the
event all or a portion of an Interest in the Company is Transferred in
accordance with the terms of the Articles of Organization and this Agreement,
the transferee shall succeed to that portion of the Capital Account of the
transferor which is allocable to the transferred Interest.
5.12 Income
Tax Consequences.
The
Members are aware of the income tax consequences of the allocations made
by this
Article 5 and hereby agree to be bound by the provisions of this Article
5
in reporting their shares of Company income and loss for income tax
purposes.
ARTICLE
VI
MANAGEMENT
OF THE COMPANY
6.1 Management.
(a) The
Company shall be managed by a Board of Directors appointed by the Members
(in
accordance with Section 6.1(c)). All powers of the Company shall be exercised
by
or under the authority of, and the business affairs of the Company managed
under
the direction of the Board of Directors in accordance with this Agreement.
Individual Directors or Officers designated by the Board from time to time
may
act for or on behalf of the Company and execute all agreements on behalf
of the
Company and otherwise bind the Company as to third parties without the consent
of the Members or remainder of the Board of Directors; provided,
however,
that
with respect to those issues requiring approval of the Members under the
Act or
as set forth in this Agreement, such approval must first be obtained;
provided,
further,
that
the affirmative vote of a Majority of the Board shall be required for (a)
incurring any indebtedness or expense in excess of $20,000 other than in
the
ordinary course of business; (b) pledging,
mortgaging, encumbering or granting any lien on any assets of the Company
other
than in the ordinary course of business; or (c) purchasing any asset or making
capital expenditures in excess of $20,000.
10
(b) The
salaries and other compensation, if any, of the Directors for management
services shall be fixed annually by a Super Majority Vote of the Board. A
Board
decision on this matter may be changed by a Super Majority Vote of the Members
at any duly-called annual or special meeting.
(c) The
Board
of Directors shall be comprised of thirteen (13) members who
shall
be elected at the annual meeting of the Members in accordance with Section
8.2
of this Agreement. The
Board
of Directors shall be divided into three classes, Class I, Class II, and
Class
III, with Class I consisting of five (5) directors and Class II and Class
III
each consisting of four (4) directors. Duly elected and qualified Class I
directors shall serve until the 2002 annual meeting of Members and, thereafter,
the terms of the Class I directors shall extend until the third succeeding
annual meeting after each election of such directors. Duly elected and qualified
Class II directors shall serve until the 2003 annual meeting of Members and,
thereafter, the terms of Class II directors shall extend until the third
succeeding annual meeting after each election of such directors. Duly elected
and qualified Class III directors shall serve until the 2004 annual meeting
of
Members and thereafter, the terms of Class III directors shall extend until
the
third succeeding annual meeting after each election of such
directors. Directors
need not be residents of the State of Nebraska or Members of the
Company.
(d) Nominations
for election to the Board of Directors may be made by the Board of Directors,
the nominating committee, or by any Member entitled to vote for the election
of
Directors. Nominations, other than those made by or on behalf of the existing
management of the Company, shall be made in writing and shall be delivered
or
mailed to the Secretary of the Company or to the chairman of the nominating
committee, no earlier than the first day of the October preceding the annual
meeting and no later than the last day of the March preceding the annual
meeting. Or, in the event of a special meeting of Members, not later than
the
close of the fifteenth day following the day on which notice of the meeting
is
first mailed to Members. Each nomination shall contain such information about
the nominee which shall be deemed appropriate, from time to time, by the
nominating committee. Each nomination shall be accompanied by the written
consent of each nominee to serve as a Director of the Company if so elected.
At
the meeting of Members, the Chairman of the Board shall declare out of order
and
disregard any nomination not presented in accordance with this
section.
6.2 Authority
of the Board of Directors.
In
addition to and not in limitation of any rights and powers conferred by law
or
other provisions of this Agreement, and except as limited, restricted or
prohibited by the express provisions of this Agreement, the Board of Directors
shall have and may exercise on behalf of the Company, all powers and rights
necessary, proper, convenient or advisable to effectuate and carry out the
purposes, business and objectives of the Company. Such powers shall include,
without limitation, the power to:
(a) expend
Company funds in connection with the operation of the Company's business
or
otherwise pursuant to this Agreement;
(b) employ
and dismiss from employment any and all employees, agents, independent
contractors, attorneys and accountants;
11
(c) prosecute,
settle or compromise all claims against third parties, compromise, settle
or
accept judgment on, claims against the Company and execute all documents
and
make all representations, admissions and waivers in connection
therewith;
(d) borrow
money on behalf of the Company from any Person, issue promissory notes; drafts
and other negotiable and non-negotiable instruments and evidences of
indebtedness, secure payment of the principal of any such indebtedness and
the
interest thereon by mortgage, pledge, property of the Company, whether at
the
time owned or thereafter acquired;
(e) hold,
receive, mortgage, pledge, lease, transfer, exchange, otherwise dispose of,
grant options with respect to, and otherwise deal in the exercise all rights,
powers, privileges and other incidents of ownership or possession with respect
to all property of whatever nature held or owned by, or licensed to, the
Company;
(f) lend
any
of the Company property with or without security;
(g) have
and
maintain one or more offices within or without the State of
Nebraska;
(h) open,
maintain and close bank accounts and money market mutual funds accounts,
and
draw checks and other orders for the payment of monies;
(i) engage
accountants, custodians, consultants and attorneys and any and all other
agents
and assistants (professional and nonprofessional) and pay such compensation
in
connection with such engagement that the Board of Directors determines is
appropriate;
(j) enter
into, execute, make, amend, supplement, acknowledge, deliver and perform
any and
all contracts, agreements, licenses, and other instruments, undertakings
and
understandings that the Board determines is necessary, appropriate or incidental
to carrying out the business of the Company;
(k) file
a
petition in bankruptcy on behalf of the Company;
(l) delegate
to the Chairman, President and other Officers such responsibility and authority
as the Board deems necessary or appropriate from time to time; and
(m) issue
additional Units to new and existing Members of the Company from time to
time on
terms and conditions determined by the Board in its sole
discretion.
In
exercising its powers, the Board of Directors may (i) rely upon and shall
be
protected in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, or document believed by him or her
to be
genuine and to have been signed or presented by the proper party or parties;
(ii) consult with counsel, accountants, and other experts selected by him
or her
and any opinion of an independent counsel, accountant or expert shall be
full
and complete authorization and protection in respect of any action taken
or
suffered or omitted by the Board of Directors in good faith and in accordance
with such opinion; and (iii) execute any of his or her powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys.
12
6.3 Obligations
of the Board of Directors.
The
Board of Directors shall:
(a) devote
to
the Company and apply to the accomplishment of Company purposes so much of
the
Board of Directors’ time and attention as they determine to be necessary or
advisable to manage properly the affairs of the Company;
(b) maintain
accounting records from which a Company Capital Account Balance can be
determined for each Member;
(c) execute,
file, record or publish all certificates, statements and other documents
and do
all things appropriate for the formation, qualification and operation of
the
Company and for the conduct of its business in all appropriate
jurisdictions;
(d) employ
attorneys to represent the Company when necessary or appropriate;
(e) use
their
best efforts to maintain the status of the Company as a "limited liability
company" for state law purposes, and as a "partnership" for federal income
tax
purposes;
(f) have
fiduciary responsibility for the safekeeping and use of all funds and assets
of
the Company, and not employ or permit others to employ such funds or assets
(including any interest earned thereon) in any manner except for the benefit
of
the Company; and
(g) maintain
a current list of the names, last known addresses and Percentage Interest
of
each Member at the Company's principal office.
6.4 Resignation
of Director.
Any
Director may resign as Director of the Company upon written notice to the
Board
of Directors.
6.5 Removal
of Director.
Any
Director may be removed from time to time with or without cause by the
affirmative vote of Members holding a Majority in Interest.
6.6 Vacancies.
Any
vacancy occurring in the position of Director may be filled by the affirmative
vote of a Majority of the Board based on the remaining Directors.
6.7 Meetings
of the Board.
Meetings
of the Board may be called by the Chairman of the Board or any two (2) Directors
and shall be held at the principal place of business of the Company, or
elsewhere as the notice of such meeting shall direct. Except as otherwise
expressly provided in this Agreement, the Articles, or the Act, the affirmative
vote of a majority of the Directors present at a duly convened meeting of
the
Board at which a quorum is present shall constitute the act of the
Board.
6.8 Place
of Meeting.
The
Board may designate any place, either in or out of the State of Nebraska,
as the
place of meeting for any meeting. If no designation is made, the place of
meeting shall be the Company's principal office. Directors
may attend any such meeting in person or by telephonic or video conference
call.
6.9 Notice
of Meetings.
Written
or oral notice of every meeting of the Board, stating the place, date and
hour
of the meeting, and the purpose or purposes for which the meeting is called,
shall be given by the Secretary of the Company to each other Director at
least
twenty-four (24) hours prior to the meeting, unless such notice is waived
in
accordance with Article 9 hereof.
13
6.10 Quorum.
The
presence of a Majority in Interest of the Directors shall constitute a quorum
for the transaction of business. If a quorum is not present at a meeting,
a
majority of the Directors represented may adjourn the meeting from time to
time
without further notice.
6.11 Officers.
(a) The
Board
may elect a Chairman, Vice Chairman, President, one or more Vice Presidents,
Treasurer, and Secretary from among its Directors. Any two (2) or more offices
may be held by the same person.
(b) The
Officers of the Company shall be elected annually by the Board at the first
meeting of the Board held after each annual meeting of Members. If the election
of Officers shall not be held at such meeting, such election shall be held
as
soon thereafter as conveniently may be. Vacancies may be filled or new offices
created and filled at any meeting of the Board. Each Officer shall hold office
until his or her successor shall have been duly elected and qualified or
until
his or her death, or until he or she shall resign or shall have been removed
in
the manner hereinafter provided. Election or appointment of an Officer or
agent
shall not of itself create contract rights.
(c) Any
Officer or agent may be removed by the Board at any time with or without
cause,
but such removal does not affect the contract rights, if any, with the Company
of the person so removed.
(d) A
vacancy
in any office because of death, resignation, removal, disqualification or
otherwise, may be filled by the Board for the unexpired portion of the term.
An
Officer may resign at any time by delivering notice to the Company. A
resignation is effective when the notice is delivered unless the notice
specifies a later effective date. If a resignation is made effective at a
later
date and the Company accepts the future effective date, the Board may fill
the
pending vacancy before the effective date if the Board provides that the
successor does not take office until the effective date.
6.12 Liabilities
of Directors.
In
carrying out their duties hereunder, the Directors shall not be liable to
the
Company or to any Member for any actions taken in good faith and reasonably
believed by them to be in the best interest of the Company or in reliance
on the
provisions of this Agreement or the Articles, or for good faith errors of
judgment, but shall only be liable for misconduct or negligence in the
performance of their duties as Directors. The Directors shall not be expected
to
devote their full time and attention to the affairs of the Company, but shall
devote such amounts of time and attention as are reasonable and appropriate
in
their good faith judgment under the circumstances prevailing from time to
time.
6.13 Indemnification
of the Directors, their Affiliates and Control Persons.
(a) Neither
the Directors nor any Officer shall be liable to the Company or any Member
for
any act or omission based upon errors of judgment or other fault in connection
with the business or affairs of the Company if the Board determines that
such
course of conduct was in the best interest of the Company and did not result
from the negligence or misconduct of such Director or Officer.
14
(b) To
the
fullest extent permitted by law, the Directors and Officers (each such person
being referred to herein as an "Indemnitee"),
shall
be indemnified and held harmless by the Company from and against any and
all
losses, claims, damages, settlements and other amounts arising from any and
all
claims (including attorneys' fees and expenses, as such fees and expenses
are
incurred), demands, actions, suits or proceedings (civil, criminal,
administrative or investiga-tive), in which they may be involved, as a party
or
otherwise, by reason of their management of the affairs of the Company, whether
or not they continue to be such at the time any such liability or expense
is
paid or incurred; provided that Indemnitee shall not be entitled to the
foregoing indemnification if a court of competent jurisdiction shall have
determined that such losses, claims, damages, liabilities, expenses or such
other amounts resulted primarily from the negligence or misconduct of such
Indemnitee. The termination of a proceeding by judgment, order, settlement
or
conviction upon a plea of nolo contenders, or its equivalent, shall not,
of
itself, create any presumption that such losses, claims, damages, liabilities,
expenses or such other amounts resulted primarily from the negligence or
misconduct of any Indemnitee or that the conduct giving rise to such liability,
was not in the best interest of the Company. The Company shall also indemnify
any Indemnitee who was or is a party or is threatened to be made a party
to any
threatened, pending or completed action by or in the right of the Company
to
procure a judgment in its favor by reason of the fact that such Indemnitee
is or
was an agent of the Company, against any losses, claims, damages, liabilities,
expenses or any other amounts incurred by such Indemnitee in connection with
the
defense or settlement of such action; provided that no Indemnitee shall be
entitled to the foregoing indemnification if a court of competent jurisdiction
shall have determined that any such losses, claims, damages, liabilities,
expenses or such other amounts resulted from the negligence or misconduct
of
such Indemnitee. The Company may advance any Indemnitee any expenses (including,
without limitation, attorneys' fees and expenses) incurred as a result of
any
demand, action, suit or proceeding referred to in this paragraph (b) provided
that (i) the legal action relates to the performance of duties or services
by
the Indemnitee on behalf of the Company; and (ii) the Indemnitee gives a
full
recourse promissory note to the Company for the amounts of such advances
payable
in the event that the Indemnitee is determined to be not entitled to
indemnification hereunder.
(c) The
indemnification provided by paragraph (b) of this Section 6.13 shall not
be
deemed to be exclusive of any other rights to which any Indemnitee may be
entitled under any agreement, as a matter of law, in equity or otherwise,
and
shall con-tinue as to an Indemnitee who has ceased to have an official capacity
and shall inure to the benefit of the heirs, successors and administrators
of
such Indemnitee.
(d) Any
indemnification pursuant to this section will be payable only from the Company’s
assets.
6.14 Transactions
with the Directors or their Affiliates.
The
Board, on behalf of the Company, may enter into contracts with the Directors,
Officers or Members (or their Affiliates), provided that any such transactions
shall be on terms no more favorable to the Directors, Officers, Members (or
their Affiliates) than generally afforded to non-affiliated parties in a
similar
transaction.
6.15 Conflicts
of Interest.
Subject
to the other express provisions of this Agreement, the Directors at any time
and
from time to time may engage in and possess interests in other business ventures
of any and every type and description, independently or with others, including
ones in competition with the Company, with no obligation to offer to the
Company
or any other Member the right to participate therein.
ARTICLE
VII
RIGHTS
AND OBLIGATIONS OF MEMBERS
7.1 Limitation
of Liability. Each
Member’s liability shall be limited as set forth
in
this Agreement, the Act and other applicable law.
7.2 Company Debt
Liability.
A
Member will not be personally liable for any debts or losses of the Company
beyond his or her respective Capital Contributions except as provided in
Section
7.6 or as otherwise required by law.
7.3 Liability
to Third Parties.
No
Member or Director is liable for the debts, obligations or liabilities of
the
Company, whether arising in contract, tort or otherwise, including under
a
judgment, decree or order of a court.
15
7.4 Lack
of Authority.
No
Member (other than a Director or an Officer as provided under Article VI)
has
the authority or power to act for or on behalf of the Company, to do any
act
that would be binding on the Company or to incur any expenditures on behalf
of
the Company.
7.5 List
of Members.
Members
may obtain a copy of the Membership Register in accordance with the provisions
of Section 11.5.
7.6 Member
Liability to the Company.
(a)
A
Member
who rightfully receives the return in whole or in part of its Capital
Contribution is nevertheless liable to the Company to the extent now or
hereafter provided by the Act.
(b)
A
Member
who receives a Distribution made by the Company: (i) which is either in
violation of this Agreement, or (ii) when the Company's liabilities exceed
its
assets (after giving effect to the Distribution), is liable to the Company
for a
period of six (6) years after such Distribution for the amount of the
Distribution.
7.7 Representations
and Warranties.
Each
Member hereby represents and warrants to the Company that: (i) the Member
has
full power and authority to execute and agree to this Agreement and to perform
its obligations hereunder, and that all actions necessary for the due
authorization, execution, delivery and performance of this Agreement by that
Member have been duly taken; (ii) the Member has duly executed and delivered
this Agreement; and (iii) the Member's authorization, execution, delivery,
and
performance of this Agreement do not conflict with any other agreement or
arrangement to which the Member is a party or by which the Member is
bound.
7.8
Member
Information
(a) In
addition to the other rights specifically set forth in this Agreement, each
Member is entitled to the information to which that Member is entitled to
have
access pursuant to the Act, under the circumstances therein stated.
(b) The
Members acknowledge that, from time to time, they may receive information
from
or concerning the Company in the nature of trade secrets or that otherwise
is
confidential, the release of which may damage the Company or Persons with
which
it does business. Each Member shall hold in strict confidence any information
that it receives concerning the Company that is identified as being confidential
(and if that information is provided in writing, that is so marked) and may
not
disclose it to any Person other than another Member or the Director, except
for
disclosures (i) compelled by law (but the Member must notify the Director
promptly of any request for that information, before disclosing it, if legal
and
practicable); (ii) to Persons to whom that Member's Interest may be transferred
as permitted by this Agreement, but only if the recipients have agreed to
be
bound by the provisions of this Section 7.8; or (iii) of information that
the
Member also has received from a source independent of the Company and the
Member
reasonably believes that source obtained the information without breach of
any
obligation of confidentiality. The Members acknowledge that breach of the
provisions of this Section 7.8 may cause irreparable injury to the Company
for
which monetary damages are inadequate, difficult to compute, or both.
Accordingly, the Members agree that the provisions of this Section 7.8 may
be
enforced by specific performance.
16
7.9 Membership
Certificates.
“Membership
Certificates”
in the
form determined by the Board may be delivered representing all Interests
to
which Members are entitled. If issued, such Membership Certificates shall
be
consecutively numbered, and shall be entered in the books of the Company
and on
the Membership Register, as they are issued. Each Membership Certificate
shall
state on the face thereof the holder's name, the Interests and such other
matters as may be required by applicable laws. Each such Membership Certificate
shall be signed by a Director of the Company and may be sealed with the seal
of
the Company or a facsimile thereof if adopted. The signature of the Director
upon the Membership Certificates may be facsimile. Subject to Article
10, upon
surrender to the Company of a Membership Certificate for Interests duly endorsed
or accompanied by proper evidence of succession, assignment or authority
to
Transfer, it shall be the duty of the Company to issue a new Membership
Certificate to the person entitled thereto, cancel the old Membership
Certificate and record the transaction upon its books and records and the
Membership Register. Each
Member hereby agrees that the following legend, as the same may be amended
by
the Board in its sole discretion, may be placed upon any counterpart of this
Agreement, the Articles, or any other document or instrument evidencing
ownership of Units:
The
sale,
pledge, hypothecation, assignment or transfer of the ownership interest
represented by this CERTIFICATE OF OWNERSHIP is subject to the terms and
conditions of the Operating Agreement of Husker Ag, LLC, as amended from
time to
time. Copies of the Operating Agreement may be obtained upon written request
to
the Board of Directors of Husker Ag, LLC.
ARTICLE
XIII
MEETINGS
OF MEMBERS
8.1 Voting
Power.
The
affirmative vote of Members holding a Majority in Interest at a meeting at
which
there is a quorum present shall be the act of the Members; provided,
however,
that
the dissolution and winding up of the Company requires the approval of Members
required under Section 21-2622 of the Act, as amended from time to time;
provided,
however,
in the
event that the statute referred to above is amended to require approval of
Members holding less than eighty percent (80%), the dissolution and winding
up
of the Company shall require the affirmative vote of Members holding eighty
percent (80%) of the Percentage Interests. Provided,
further,
that a
Super-Majority Vote of the Members shall be required for approval of the
following actions: (a) the sale, exchange, lease, mortgage, pledge
or other
transfer of all or substantially all of the assets of the Company other than
in
the ordinary course of business; and (b) the merger or consolidation
of the
Company with another entity.
8.2 Cumulative
Voting.
At each
election for Directors, every Member entitled to vote at such election shall
have the right to vote, in person or by proxy, the number of Units owned
by him
or her for as many persons as there are Directors to be elected and for whose
election he or she has a right to vote, or to cumulate his or her votes by
giving one candidate as many votes as the number of such Directors multiplied
by
the number of his or her Units, or by distributing such votes on the same
principle among any number of candidates.
8.3 Meetings
of Members.
The
annual meeting of Members shall be held on such date as the Board shall by
resolution specify within a period commencing on January 1 and ending on
June 30
in each year, beginning with 2002. At each annual meeting, Members shall
conduct
such business as may be properly presented to such meeting. If the day fixed
for
the annual meeting shall be a legal holiday, such meeting shall be held on
the
next succeeding business day. Special
meetings
of Members of the Company may be called by the Chairman of the Board, by
any
three (3) Directors, or upon the written demand of Members holding at least
a
ten percent (10%) Percentage Interest and shall be held at the principal
place
of business of the Company, or elsewhere as the notice of such meeting shall
direct. Members may attend any such meeting in person or by proxy.
8.4 Place
of Meeting.
The
Board of Directors may designate any place, either in or out of the State
of
Nebraska, as the place of meeting for any meeting. If no designation is made,
the place of meeting shall be the Company's principal office.
17
8.5 Notice
of Meetings.
Written
notice stating the date time and place of the meeting and a description of
the
purpose or purposes for which the meeting is called, shall be mailed, unless
oral notice is reasonable under the circumstances, not fewer than ten (10)
nor
more than sixty (60) calendar days before the date of the meeting, by or
at the
direction of the Board of Directors to each Member of record entitled to
vote at
the meeting. If mailed, such notice is effective when mailed addressed to
the
Member's address shown in the Company's current record of Members, with postage
prepaid.
8.6 Quorum.
The
presence of Members holding a majority of the Percentage Interests in person
or
by proxy shall constitute a quorum for the transaction of business. If a
quorum
is not present at a meeting, a majority of the Percentage Interests represented
may adjourn the meeting from time to time without further notice.
ARTICLE
IX
WAIVER
AND CONSENT
9.1 Written
Waiver.
Whenever any notice whatsoever is required to be given under the provisions
of
this Agreement or under the provisions of the Articles or the Act, waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent
to
the giving of such notice.
9.2 Waiver
by Attendance. A
Member's or Director’s attendance at a meeting of the Members or Directors,
respectively: (i) waives objection to lack of notice or defective
notice of
the meeting, unless the Member or Director at the beginning of the meeting
or
promptly upon the Member's or Director’s arrival objects to holding the meeting
or transacting business at the meeting, and (ii) waives objection to
consideration of a particular matter at the meeting that is not within the
purpose or purposes described in the meeting notice, unless the Member or
Director objects to considering the matter when it is presented.
9.3 Consent
to Action Without Meeting. Any
action required or permitted to be taken by the Members or Mangers by vote
may
be taken without a meeting on written consent. The consent shall set forth
the
actions so taken and be signed by a Two-Third’s Majority of the Members or
Directors.
ARTICLE
X
TRANSFER
OF MEMBERSHIP INTERESTS
10.1
Restrictions
on Transfer.
No
Member shall Transfer all or any portion of an Interest without the prior
written consent of the Board of Directors which consent may be withheld in
the
sole discretion of the Board. Notwithstanding anything contained herein to
the
contrary, no Member shall Transfer any Unit if, in the determination of the
Board, such Transfer would cause the Company to be treated as a Publicly
Traded
Partnership, and any Transfer of Unit(s) not approved by the Board of Directors
or that would result in a violation of the restrictions in this Agreement
or
applicable law shall be null and void with no force or effect whatsoever,
and
the intended transferee shall acquire no rights in such Unit.
10.2 Permitted
Transfers.
Subject
to Section 10.1 above and
the
limits on minimum transfers and total maximum ownership set forth in Section
4.3
of this Agreement, any Transfer of Units made in accordance with the following
provisions will constitute a “Permitted
Transfer”
for
purposes of this Agreement:
(a) A
Transfer by a Member and any related persons (as defined in the Code) in
one or
more transactions during any thirty (30) calendar day period of Interests
representing in the aggregate more than two percent (2%) of the total Interests
in Company;
18
(b)
A
Transfer or series of related Transfers by one or more Members (acting together)
which involves the Transfer of fifty percent (50%) or more of the outstanding
Units; or
(c)
Transfers
of Units effected through a Qualified Matching Services Program; or
(d) A
Transfer by
gift or bequest only
to a
spouse or child of such transferring Member, or to a trust established for
the
benefit of such spouse or child, or to an existing Member of the Company
upon
ten (10) days’ prior written notice to the Company of such gift or bequest;
provided,
however,
that
any such transfers shall be subject to the limitations provided in Sections
4.3(a) and 10.4(c) of this Agreement, as applicable.
10.3
Conditions
Precedent to Transfers.
The
Board of Directors, in its sole discretion, may elect not to recognize any
Transfer of Units unless and until the Company has received:
(a)
an
opinion of counsel (whose fees and expenses shall be borne by the transferor)
satisfactory in form and substance to the Board that such Transfer may be
lawfully made without registration or qualification under applicable state
and
federal securities laws, or such Transfer is properly registered or qualified
under applicable state and federal securities laws and if, requested by the
Company that such Transfer will not cause the Company to be treated as a
Publicly Traded Partnership;
(b)
such
documents and instruments of conveyance executed by the transferor and
transferee as may be necessary or appropriate in the opinion of counsel to
the
Company to effect such Transfer, except that in the case of a Transfer of
Units
involuntarily by operation of law, the Transfer shall be confirmed by
presentation of legal evidence of such Transfer, in form and substance
satisfactory to the Company;
(c)
the
transferor's Membership Certificate;
(d)
the
transferee's taxpayer identification number and sufficient information to
determine the transferee's initial tax basis in the interest transferred,
and
any other information reasonably necessary to permit the Company to file
all
required federal and state tax returns and other legally required information
statements or returns;
(e)
evidence
satisfactory in form and substance to the Board that the transferee meets
the
maximum Unit ownership limitation set forth in Section 4.3(b) of this Agreement;
and
(f) other
conditions on the Transfer of Units adopted by the Board from time to time
as it
deems appropriate, in its sole discretion.
10.4 Death
of Member.
(a) Upon
the
death of any Member, the estate or personal representative of the deceased
Member shall have the option to request the Company repurchase the deceased
Member's Interest subject to and in accordance with the applicable Code and
Treasury Regulations regarding Publicly Traded Partnerships. If the estate
or
personal representative makes such a request, the Company may elect, in its
sole
discretion and subject to Section 10.4(b) below, to purchase the deceased
Member’s Interest at the Redemption Value of such Interest in effect at the date
of death as determined in accordance with Section 10.10 below, and on the
terms
and conditions set forth in Section 10.5 and Section 10.6 below. This request
may be made by the deceased Member’s estate or personal representative by
providing written notice to the Company within one hundred twenty (120) days
after the date of death; provided, however, the Company will not repurchase
such
interest earlier than sixty (60) days after receipt of the written notice
from
the estate or personal representative requesting the purchase.
19
(b) Any
Transfer pursuant to this Section 10.4 shall be subject to a determination
by
the Board that such Transfer shall not cause the Company to be deemed a Publicly
Traded Partnership, and such Transfer shall be affected in accordance with
this
Agreement, the Code and applicable Treasury Regulations, and shall be further
subject to the prior approval of the Board which may be withheld in its sole
discretion
(c) Beginning
August 31, 2005, the estate or personal representative of a deceased Member
may
not transfer fewer than five (5) Units to any transferee (except in the case
where all Units owned by the deceased Member are transferred to a single
transferee). Any purported transfer pursuant to this Section 10.4 of fewer
than
five (5) Units to any transferee, except in the case where all Units are
to be
transferred to a single transferee, shall be deemed to be an offer by the
estate
or personal representative to sell the affected Units to the Company in
accordance with the terms set forth in Section 10.4(a) above. If the Company
elects to purchase the affected Units in that case, the estate or personal
representative shall be required to sell the Units to the Company in accordance
with such terms and conditions. For this purpose, the affected Units shall
include any Units intended to be transferred in an amount of fewer than five
(5)
Units.
10.5 Payment
Terms. If
the
purchase price for an Interest transferred pursuant to Section 10.4 above
exceeds five thousand dollars ($5,000.00), the Company shall have the option
to
pay for the Interest purchased by paying five thousand dollars ($5,000) at
Closing (as defined below) and executing a promissory note for the balance
of
the purchase price. The promissory note shall be paid in five (5) equal annual
installments due on the anniversary date of the Closing and shall accrue
interest per annum at a rate determined by the Board which shall not be less
than the then current prime rate established by any major bank selected by
the
Board for loans to the bank’s most creditworthy commercial borrowers. The
Company may prepay the promissory note, in whole or in part, at any time
without
penalty or premium.
10.6 Events
in Connection with the Sale of Interests.
(a) If
there
is a sale of Interest under Section 10.4 of this Agreement to the Company,
the
closing ("Closing")
shall
occur at a time mutually agreeable to the parties and in accordance with
the
time periods set forth in the applicable provision of this Agreement;
provided,
however,
the
Closing shall not
occur
until at least sixty (60) days after the Company’s receipt of notice from the
estate or personal representative requesting the Company repurchase the deceased
Member’s Interest, but in no event later than one hundred twenty (120) days
after the date of the Company’s receipt of such notice.
(b) In
the
event of a sale of Interest under Section 10.4 of this Agreement to the Company,
the purchase price shall be increased or decreased, as the case may be, by
an
amount equal to any indebtedness owed the deceased Member by the Company,
or the
deduction of any indebtedness owed the Company by the deceased Member, or
both.
(c) In
the
event of the sale of Interests under this Agreement by a Member, all rights
of
the Member with respect to the Interest, including the right to vote such
Interest and to receive distributions, shall terminate at Closing, except
for
the Member’s right to receive payment therefor.
10.7 Redemption
of Interests.
(a) A
Member
(the “Requesting
Member”)
may
request redemption of his or her Interest upon not less than sixty (60) calendar
days’ prior written notice to the Board of Directors. The Board, in its sole
discretion, shall determine whether to redeem such Interest and the Board
is
under no obligation to redeem any Interest of any Requesting
Member.
20
(b) Notwithstanding
anything contained herein to the contrary, any redemption pursuant to this
Section 10.7 shall be subject to a determination by the Board, in its sole
discretion, that such redemption shall not cause the Company to be deemed
a
Publicly Traded Partnership, and such redemption shall be affected in accordance
with this Agreement, the Code and applicable Treasury Regulations, and shall
be
further subject to the prior approval of the Board which may be withheld
in its
sole discretion.
10.8 Redemption
Payment.
(a) Upon
the
redemption of a Member under Section 10.7, the Requesting Member shall be
entitled to a payment equal to the Redemption Value of such Member’s Interest in
the Company as of the effective date of the (the “Redemption
Payment”);
provided, however,
if the
remaining Members of the Company agree to dissolve the Company in accordance
with Section 13.1 of this Agreement, then in no event shall such Member be
entitled to a Redemption Payment, but such Member will be entitled to such
Member’s share of the assets of the Company pursuant to Section 13.3 below.
(b) The
Redemption Payment shall not
be paid
until at least sixty (60) days after the Company’s receipt of the notice from
the Requesting Member required under Section 10.7(a) above. The Redemption
Payment shall be paid in cash, or if the Redemption Payment exceeds five
thousand dollars ($5,000), the Company shall have the option to pay the
Redemption Payment by paying five thousand dollars ($5,000) upon the effective
date of the redemption and executing a promissory note for the balance of
the
Redemption Payment. Such note shall be dated and delivered on the effective
date
of the withdrawal and shall be paid in five (5) equal annual installments
due on
the anniversary date of the withdrawal and shall accrue interest per annum
at a
rate determined by the Board which shall not be less than the then current
prime
rate established by any major bank selected by the Board for loans to the
bank’s
most creditworthy commercial borrowers. The Company may prepay the promissory
note, in whole or in part, at any time without penalty or premium.
(c) The
Redemption Payment shall be increased or decreased, as the case may be, by
an
amount equal to any indebtedness owed the Requesting Member by the Company,
or
the deduction of any indebtedness owed the Company by the Requesting Member,
or
both. All rights of the Member with respect to the Interest, including the
right
to vote such Interest and to receive distributions, shall terminate at Closing,
except for the Member’s right to receive payment therefor upon the effective
date of the redemption which shall be determined in accordance with Section
10.9
below.
10.9 Effective
Date of Transfer.
(a) Any
Transfer of a Unit shall be deemed effective as of the day of the month and
year: (i) which the Transfer occurs (as reflected by the form of assignment);
and
(ii) the
transferee's name and address and the nature and extent of the Transfer are
reflected in the records of the Company; provided,
however,
the
effective date of a Transfer for purposes of allocation of Profits and Losses
and for Distributions shall be determined pursuant to Section 10.9(b) below.
Any
transferee of a Unit shall take subject to the restrictions on Transfer imposed
by this Agreement.
(b) The
Board, in its sole discretion, may establish interim periods in which Transfers
may occur (the “Interim
Transfer Periods”);
provided,
however,
the
Board shall provide Members reasonable notice of the Interim Transfer Periods
and advance notice of any change to the Interim Transfer Periods. For purposes
of making allocations of Profits and Losses, and Distributions, the Company
will
use the interim closing of the books method (rather than a daily proration
of
profit or loss for the entire period) and, except as otherwise determined
by the
Board, recognize the Transfer as of the last day of the Interim Transfer
Period
in which the Member complied with the notice, documentation and information
requirements of Article 10. All Distributions shall be made to the owner
of
record as of the record date as such record date is determined by the Board.
The
Board the authority to adopt other reasonable methods and/or
conventions.
21
(c) The
Board
shall have the power and authority to adopt another reasonable method and/or
convention with respect to such allocations and distributions; provided,
neither
the Company, the Board, any Director nor any Member shall incur any liability
for making allocations and distributions in accordance with the provisions
of
this Section 10.9 (other than tax liabilities which may be incurred by Members),
whether or not the Board or any Director or the Company or any Member has
knowledge of any Transfer of ownership of any Interest in the
Company.
10.10 Redemption
Value.
Upon
the Transfer of any Interest pursuant to Section 10.4, or the redemption
of an
Interest pursuant to Section 10.7, the purchase price or Redemption Payment
shall be equal to the Redemption Value of the Interest. "Redemption Value"
of an
Interest on any date shall, unless otherwise specifically provided in this
Agreement, be equal to the most recent redemption valuation determination
of the
per Unit value of the Company by the Board in good faith; provided, that
such
valuation shall be calculated on a basis as consistent as practicable from
period to period. The Board may, in its sole discretion, employ the advice
of
independent and qualified professionals in the determination of the Redemption
Value, but is not under any obligation to do so. The Redemption Value of
the
Company shall be determined at least annually. Valuations shall generally
be
performed, at the discretion of the Board, as of the end of each fiscal year
of
the Company's operations at the annual meeting of the Board; however, the
Board,
in its sole discretion, may have redemption valuations of the Company performed
at any time or from time to time during any year and, except as otherwise
specifically provided in this Agreement, shall utilize the results of the
most
recent valuation in determining the Redemption Value of an Interest for purposes
of this Agreement. No Member or any party other than the Board shall have
the
right to require or request that a new or more recent valuation be performed
for
purposes of determining the Redemption Value of the Company or an Interest
hereunder. The Company shall not
establish the Redemption Value more than four (4) times during the Company’s
taxable year.
10.11 Expenses.
Except
as otherwise expressly provided herein, all expenses of the Company incident
to
the admission of the transferee to the Company as a Member shall be charged
to
and paid by the transferring Member.
10.12 Pledged
Units.
Subject
to Section 10.1 above and
the
limits on minimum transfers and total maximum ownership set forth in Section
4.3
of this Agreement, in the event that any Member pledges or otherwise encumbers
any part of its Units as security for the payment of a debt, any such pledge
or
hypothecation shall be made pursuant to a pledge or hypothecation agreement
that
requires the pledgee or secured party to be bound by all of the terms and
conditions of this Article 10. In the event such pledgee or secured party
becomes a Member hereunder pursuant to the exercise of such party's rights
under
such pledge or hypothecation agreement, such pledgee or secured party shall
be
bound by all of the terms and conditions of this Agreement. In such case,
such
pledgee or secured party, and any transferee or purchaser of the Units held
by
such pledgee or secured party, shall not have any voting rights associated
with
such Units unless and until the Directors have approved in writing and admitted
as a Member hereunder, such pledgee, secured party, transferee or purchaser
of
such Units.
ARTICLE
XI
RECORDS,
FINANCIAL AND TAX REPORTING
11.1 Records
and Accounting.
The
books of account and other records of the Company shall be maintained at
the
Company's principal place of business. The Company shall prepare its financial
statements using generally accepted accounting principles, consistently
applied.
22
11.2 Tax
Information.
The
Board will use its best efforts to cause to be delivered, as soon as practical
after the end of each fiscal year of the Company, to the Members and Persons
who
were Members during such fiscal year all information concerning the Company
necessary to enable such Member or Person to prepare such Member's (or Person's)
Federal and state income tax returns for such fiscal year, including a statement
indicating such Member's (or Person's) share of Profits, Losses, deductions
and
credits for such fiscal year for Federal and state income tax purposes, and
the
amount of any Distribution made to or for the account of such Member or Person
during such fiscal year pursuant to this Agreement.
11.3 Tax
Returns.
The
Board shall cause income tax returns for the Company to be prepared and timely
filed in accordance with applicable law.
11.4 Tax
Matters Partner.
The
Board of Directors shall, from time to time by resolution, appoint one of
its
members as "tax matters partner" of the Company pursuant
to Code Section 6231(a)(7). Such
tax
matters partner shall be a Member of the Company. The tax matters partner
is
authorized to perform all duties imposed by Sections 6222 through 6234 of
the
Code; provided,
however,
that
the tax
matters partner may not take any such action that is material to the Company
without the consent of the Board of Directors; provided,
further,
that
this sentence does not authorize such tax matters partner, the Board or any
member of the Board to take any action left to the determination of an
individual Member under Code Sections 6222 through 6234. The
Company shall indemnify, to the full extent permitted by law, the tax matters
partner from and against any damages and losses (including attorneys' fees)
arising out of or incurred in connection with any action taken or omitted
to be
taken by in carrying out responsibilities as tax matters partner, provided
such
action taken or omitted to be taken does not constitute fraud, gross negligence
or willful misconduct.
11.5 Access
to Books and Records.
(a) A
Member
of the Company shall be entitled to inspect and copy during regular business
hours at the Company’s principal office the following records if he or she gives
the Company written notice of his or her demand at least five business days
before the date on which he or she wishes to inspect and copy:
(i) Articles
or Restated Articles of Organization and all amendments thereto currently
in
effect;
(ii) Operating
Agreement and all restatements and amendments thereto currently in effect;
(iii) Minutes
of all Member meetings and records of all action taken by Members without
a
meeting for the past three years;
(iv) All
written communications to the Members generally within the past three years;
(v) Annual
financial statements that include a balance sheet as of the end of the fiscal
year, an income statement for that year and a statement of changes in Members’
equity for that year unless such information appears elsewhere in the financial
statements, along with the accountant’s report if the annual financial
statements are reported upon by a public accountant;
(vi) A
list of
the names and business addresses of the Company’s current directors and
officers; and
(vii) The
most
recent annual report delivered by the Company to the Nebraska Secretary of
State.
23
(b) A
Member
shall be entitled to inspect and copy during regular business hours at a
reasonable location specified by the Company any of the following records
of the
Company if the Member meets the requirements of Section 11.5(c) below and
gives
the Company written notice of his or her demand at least five business days
before the date on which he or she wishes to inspect and copy:
(i) Excerpts
from minutes of any meeting of the Board of Directors, records of any action
of
a committee of the Board of Directors while acting in place of the Board
of
Directors on behalf of the Company, minutes of any meeting of the Members,
and
records of action taken by the Members or Board of Directors without a meeting,
to the extent not subject to inspection under subsection (1) of this
section;
(ii) Accounting
records of the Company; and
(iii) The
Membership Register.
(c) A
Member
may inspect and copy the records described in Section 11.5(b) above only
if: (i)
the Member’s demand is made in good faith and for a proper purpose; (ii)
the
Member describes with reasonable particularity his or her purpose and the
records he or she desires to inspect; and (iii) the records are directly
connected with the Member’s purpose.
ARTICLE
XII
FISCAL
AFFAIRS
12.1 Elections.
(a) The
Board
of Directors may elect to adjust the basis of the assets of the Company for
federal income tax purposes in accordance with Section 754 of the Code in
the
event of a distribution of Company property as described in Section 734 of
the
Code or a transfer by any Member of the Interest of such Member in the Company
as described in Section 743 of the Code.
(b) The
Board
of Directors, at any time and from time to time, may also make such other
tax
elections as it deems necessary or desirable, in its discretion.
12.2 Interim
Closing of the Books.
There
shall be an interim closing of the books of account of the Company (i) at
any
time a taxable year of the Company shall end pursuant to the Code, and (ii)
at
any other time determined by the Board of Directors to be required for good
accounting practice or otherwise appropriate under the
circumstances.
ARTICLE
XIII
TERMINATION
AND DISSOLUTION
13.1 Events
Requiring Termination and Dissolution.
The
Company shall be dissolved upon the occurrence of any event which would make
unlawful the continuing existence of the Company or in accordance with Section
21-2622 of the Act, as amended from time to time; provided,
however,
in the
event that the statute referred to above is amended to require approval of
Members holding less than eighty percent (80%) of the Percentage Interests,
the
Company shall only be dissolved upon the approval of Members holding eighty
percent (80%) of the Percentage Interests (each a “Liquidating
Event”).
24
13.2 Winding
Up Period.
Upon
the occurrence of a Liquidating Event, the Company shall continue solely
for the
purposes of winding up its affairs in an orderly manner, liquidating its
assets,
and satisfying the claims of its creditors and Members. No Member shall take
any
action that is inconsistent with, or not necessary to or appropriate for,
the
winding up the Company's business and affairs. To the extent not inconsistent
with the foregoing, all covenants and obligations in this Agreement shall
continue in full force and effect until such time as the assets of the Company
have been distributed pursuant to this Section and the Company has terminated.
The Board shall be responsible for overseeing the winding up and liquidation
of
the Company, shall take full account of the Company's liabilities and assets,
shall cause the assets to be liquidated as promptly as is consistent with
obtaining the Value thereof, and shall cause the proceeds therefrom, to the
extent sufficient therefor, to be applied and distributed in the manner required
by the Act. Without
limiting the generality of the foregoing, the Board of Directors, in carrying
out such winding up and distribution, shall have full power and authority
to
sell the Company's assets, or any part thereof, or to distribute the same
in
kind to the Members.
13.3
Distribution.
(a) Upon
the
occurrence of a Liquidating Event and the dissolution of the Company, the
affairs of the Company shall be wound up in accordance with Section 13.2
above.
The fair market value of the assets of the Company shall be determined, with
the
Value of any real or personal property held by the Company being determined
in
accordance with paragraph (e) of Section 5.8 and the fair market value of
any
other assets held by the Company (other than cash) being determined by an
independent appraiser selected by the Board. Thereupon, the assets of the
Company shall be distributed in the following manner and order: (i) to the
claims of all creditors of the Company, including Members who are creditors,
to
the extent permitted by law, in satisfaction of liabilities of the Company,
other than liabilities for distributions to Members; (ii) to Members
and
former Members in satisfaction of liabilities for distribution, pursuant
to
Section 21-2625(1)(b) of the Act, and (iii) to the Members with positive
Capital Account Balances in accordance with their Percentage Interests. Each
such Member entitled to a distribution of any assets of the Company, pursuant
to
clause (iii) of this paragraph (a), shall receive such Member's share of
such
assets in cash or in kind, and the portion of such share that is received
in
cash may vary from Member to Member, all as the Board of Directors in their
discretion may decide. If distributions to any Member upon termination of
the
Company are insufficient to return to such Member the full amount of such
Member's Capital Contribution, such Member shall have no recourse against
the
Board of Directors, the Company or against any other Member.
(b) In
the
discretion of the Board, a Pro Rata portion of the distributions that would
otherwise be made to the Members pursuant to Section 13.3(a) hereof may
be:
(i) distributed
to a trust established for the benefit of the Members for the purposes of
liquidating Company assets, collecting amounts owed to the Company, and paying
any contingent or unforeseen liabilities or obligations of the Company or
of the
Members arising out of or in connection with the Company. The assets of any
such
trust shall be distributed to the Members from time to time, in the reasonable
discretion of the Board, in the same proportions as the amount distributed
to
such trust by the Company would otherwise have been distributed to the Members
pursuant to Section 13.3(a) hereof; or
(ii) withheld
to provide a reasonable reserve for Company liabilities (contingent or
otherwise) and to reflect the unrealized portion of any installment obligations
owed to the Company, provided that such withheld amounts shall be distributed
to
the Members as soon a practicable.
13.4. Deficit
Capital Account Balance.
The
Members shall have no liability to the Company, to the other Members, or
to the
creditors of the Company on account of any deficit balance in such Member's
Capital Account Balance except to the extent such deficit arises from the
failure of the Member to contribute the full amount of its Capital Contribution.
The Company shall be solely responsible for payment of liabilities to its
creditors.
25
ARTICLE
XIV
MISCELLANEOUS
14.1 Notices.
All
Notices or other communications under this Agreement shall be in writing
(unless
otherwise expressly provided herein) and shall be considered properly given
if
delivered by hand or mailed by first class United States Mail, postage prepaid,
addressed in care of the respective Members or Directors at their last-known
address. Notice may also be delivered by means of a confirmed telecopy, provided
the original of the notice is also promptly deposited in the United States
Mail,
first class postage prepaid, addressed to the Members or Director's at such
address. Notice of change of address shall be given to the Company by hand
or
first class united States Mail, after the date of receipt of which notice,
the
change of address shall be effective. Unless actual receipt of a notice is
required by an express provision hereof, any such notice shall be deemed
to be
effective as of the earliest of (a) the date of delivery or confirmed telecopy,
or (b) the third business day following the date of deposit with the United
States Post Office or in a regularly maintained receptacle for the deposit
of
United States Mail. Any refusal to accept delivery of any such communication
shall be considered successful delivery thereof.
14.2 Insurance.
The
Company may purchase and maintain insurance on behalf of any person who is
or
was a Director, Member, employee or agent of the Company or is or was serving
at
the request of the Company as a Director, member, officer, director, employee
or
agent of another limited liability company, corporation, partnership, joint
venture, trust, or other enterprise, against any liability asserted against
such
person and incurred in any such capacity or arising out of his or her status
as
such.
14.3 Successors.
This
Agreement and all of the terms and provisions thereof shall be binding upon
the
Directors and all Members and their respective legal representatives, heirs,
successors and permitted assigns.
14.4 Applicable
Law.
This
Agreement and the rights and obligations of the Members thereunder shall
be
construed and interpreted under the laws of the State of Nebraska without
regard
to its conflict of law principals.
14.5 Amendments.
This
Agreement may not be modified or amended except upon the Super-Majority Vote
of
the Board or upon
an
affirmative vote of Two-Thirds (2/3) Majority of the Members. Upon the
modification or amendment of this Agreement, the Board shall
promptly execute such amendments or other documents as the Company deems
appropriate to reflect such amendments under the law of the State of Nebraska.
In the event the Board materially modifies or amends this Agreement pursuant
to
this Section 14.5, the Board shall send notice to the Members of the material
modification or amendment within a reasonable period of time after the effective
date of such modification or amendment.
14.6 Waiver
of Partition.
Each of
the Members of the Company irrevocably waives any right to maintain any action
for partition with respect to the property of the Company.
14.7 Company
Property.
The
legal title to any real or personal property or interest therein now or
hereafter acquired by the Company shall be owned, held or operated in the
name
of the Company, and no Member, individually, shall have any ownership interest
in such property.
26
14.8 Acceptance
of Prior Acts by New Members.
Each
Person becoming a Member, by becoming a Member, ratifies all action duly
taken
by the Company, pursuant to the terms of this Agreement, prior to the date
such
person becomes a Member.
14.9 Section
Headings.
The
division of this Agreement into sections, subsections and exhibits is for
convenience of reference only and shall not affect the interpretation or
construction of this Agreement.
14.10 Severability.
In the
event that one or more of the provisions contained in this Agreement or any
portions thereof are unenforceable or are declared invalid for any reason
whatsoever, such enforceability or invalidity shall not affect the
enforceability or validity of the remaining terms or portions of this Agreement,
and each such unenforceable or invalid portion hereof shall be severable
from
the remainder of this Agreement and the remainder of this Agreement shall
be
interpreted as if such unenforceable or invalid provision or portion thereof
had
not been included as a part thereof.
14.11 Agreement
for Further Execution.
At any
time or times, upon the request of the Board, the Members agree to sign and
swear to any certificate required by the Act, to sign and swear to any amendment
to or cancellation of such certificate whenever such amendment or cancellation
is required by law or by this Agreement, and to cause the filing of any of
the
same of record wherever such filing is required by law.
14.12 Time.
Time is
an essential element to the performance of this Agreement by each Member.
14.13 Copies
Reliable and Admissible.
This
Agreement shall be considered to have been executed by a person if there
exists
a photocopy, facsimile copy, or a photocopy of a facsimile copy of an original
hereof or of a counterpart hereof which has been signed by such person. Any
photocopy, facsimile copy, or photocopy of facsimile copy of this Agreement
or a
counterpart hereof shall be admissible into evidence in any proceeding as
though
the same were an original.
14.14 Entire
Agreement.
This
Agreement is the sole operating agreement of the Company and constitutes
the
entire agreement among the parties; it supersedes any prior agreements or
understandings among the parties, oral or written, all of which are hereby
canceled.
14.15 Gender.
Whenever the context shall require, each term stated in either the singular
or
plural shall include the singular and the plural, and masculine or neuter
pronouns shall include the masculine, the feminine and the neuter.
14.16 No
Waiver.
No
failure or delay on the part of any Member in exercising any rights under
this
Agreement, or in insisting on strict performance of any covenant or condition
contained in this Agreement, shall operate as a waiver of any of such Member's
rights hereunder.
14.17 Submission
to Jurisdiction.
Each of
the parties to this Agreement hereby submits to the jurisdiction of and agrees
that suit will only be brought in the state or federal court sitting in Omaha,
Nebraska (the “Nebraska
Court”)
in any
action or proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby. Each party also agrees not to bring any
action
or proceeding arising out of or relating to this Agreement or the transactions
contemplated thereby in any other court except as may be necessary to enforce
any judgment or order of the Nebraska Court. Each of the parties waives any
defense of inconvenient forum to the maintenance of any action or proceeding
so
brought and waives any bond, surety or other security that might be required
of
any other party with respect thereto.
27
14.18 Specific
Performance.
Each of
the parties acknowledges and agrees that the other party would be damaged
irreparably in the event any of the provisions of this Agreement are not
performed in accordance with their specific terms or otherwise are breached.
Accordingly, each of the parties agrees that the other parties shall be
entitled, without posting a bond or other collateral, to an injunction or
injunctions to prevent breaches of the provisions of this Agreement and to
enforce specifically this Agreement and the terms and provisions hereof in
any
action instituted in the Nebraska Court, in addition to any other remedy
to
which it may be entitled, at law or in equity.
14.19 Counterparts.
This
Agreement may be executed in several counterparts, each of which shall be
deemed
an original but all of which shall constitute one and the same
instrument.
14.20 Creditors.
None of
the provisions of this Agreement shall be for the benefit of or enforceable
by
any creditors of the Company.
THIS
SECOND AMENDED AND RESTATED OPERATING AGREEMENT INCLUDES AMENDMENT NO.'S
1
THROUGH 11.
DATED
AS OF AUGUST 31, 2005.
28