EXHIBIT 3.56
Draft of January 30, 2002
(Version 1 is Execution Copy of Southwest 1 (r 12))
AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
VALOR TELECOMMUNICATIONS SOUTHWEST II, LLC
Dated as of January 31, 2002
LIMITED LIABILITY COMPANY AGREEMENT
OF
VALOR TELECOMMUNICATIONS SOUTHWEST II, LLC
TABLE OF CONTENTS
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ARTICLE I THE COMPANY - FORMATION AND PURPOSES................................................. 2
1.1 Formation and Continuation............................................... 2
1.2 Name..................................................................... 2
1.3 Principal Office......................................................... 2
1.4 Effective Date; Duration................................................. 3
1.5 Fiscal Year.............................................................. 3
1.6 Purposes................................................................. 3
1.7 Organizational Expenses.................................................. 3
1.8 Seal of the Company...................................................... 3
ARTICLE II MANAGEMENT AND OPERATION OF THE COMPANY............................................. 4
2.1 Power and Authority of Members........................................... 4
2.2 Power and Authorty of the Managers....................................... 4
2.3 Members.................................................................. 4
2.4 Intentionally Omitted.................................................... 7
2.5 Intentionally Omitted.................................................... 7
2.6 Managers; Number, Appointment, Removal, Qualifications,Etc............... 7
2.7 Managers; Meetings; Committees and Delegation............................ 7
2.8 Officers................................................................. 9
2.9 Liability of Members and Managers........................................ 11
2.10 Certain Duties and Liabilities of Managers and Officers................... 12
2.11 Reliance by Third Parties................................................. 12
2.12 Books and Records......................................................... 13
2.13 Indemnification........................................................... 13
2.14 Corporate Opportunity..................................................... 16
2.15 Intentionally Omitted..................................................... 16
2.16 Certain Policies.......................................................... 16
ARTICLE III CAPITAL CONTRIBUTIONS.............................................................. 16
3.1 Form of Contribution..................................................... 16
3.2 Non-Cash Contributions by the Initial Member............................. 16
3.3 Cash Contributions by the Members;....................................... 17
3.4 Intentionally Omitted.................................................... 17
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3.5 Withdrawal of Capital; Limitation on Distributions....................... 17
3.6 New Members.............................................................. 17
3.7 Intentionally Omitted.................................................... 17
3.8 Distributions............................................................ 18
3.9 Withholding.............................................................. 18
ARTICLE IV INTERESTS AND OTHER SECURITIES...................................................... 18
4.1 Preferred and Common Interests........................................... 18
4.2 Preferred Interests...................................................... 19
4.3 Class A Non-Voting Common Interests...................................... 21
4.4 Class B Common Interests................................................. 22
4.5 Priority of Payments Upon Liquidation; Certain Restrictions.............. 22
4.6 Certain Notices.......................................................... 23
4.7 Issuance of Interests Upon the Admission of Additional Members........... 24
4.8 Fractional Interests..................................................... 24
ARTICLE V DISSOLUTION AND WINDING-UP........................................................... 24
5.1 Dissolution.............................................................. 24
5.2 Resignation of Members................................................... 24
5.3 Winding-Up............................................................... 25
ARTICLE VI RESTRICTIONS ON TRANSFER; CERTAINSALE AND PREEMPTIVE RIGHTS......................... 25
6.1 General; Tag-Along Rights................................................ 25
6.2 Right of First Refusal................................................... 27
6.3 Permitted Transfers...................................................... 28
6.4 Preemptive Rights........................................................ 28
6.5 Sale of the Business; Drag-Along Rights; Etc............................. 29
ARTICLE VII ADMISSION OF NEW MEMBERS........................................................... 30
7.1 Admission of New Members.................................................. 30
7.2 Transferees and Assignees................................................. 30
ARTICLE VIII CERTAIN AGREEMENTS................................................................ 31
8.1 ▇▇▇▇▇▇▇, Etc............................................................. 31
8.2 Public Offering.......................................................... 33
8.3 Plan Asset Regulations................................................... 34
ARTICLE IX CERTAIN DEFINITIONS................................................................. 34
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ARTICLE X MISCELLANEOUS PROVISIONS............................................................. 39
10.1 Entire Agreement......................................................... 39
10.2 Amendment................................................................ 39
10.3 Duration of Certain Agreements........................................... 40
10.4 Interpretation........................................................... 40
10.5 Severability............................................................. 40
10.6 ▇▇▇▇▇▇ and Benefit Upon Successors ...................................... 40
10.7 Assurances .............................................................. 40
10.8 Counterparts............................................................. 40
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TESTIMONIUM................................................................................... 55
SCHEDULE I Description of Initial Capital Contribution
SCHEDULE II Members
SCHEDULE III Capitalization
SCHEDULE W Kerrville Stock Purchase Agreement
ANNEX A Board of Managers
ANNEX B Initial Officers
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AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
OF
VALOR TELECOMMUNICATIONS SOUTHWEST II, LLC
a Delaware limited liability company
Amended and Restated Limited Liability Company Agreement (this
"Agreement"), dated as of January 31, 2002 of Valor Telecommunications Southwest
II, LLC , a Delaware limited liability company (the "Company"), among (i) Valor
Telecommunications, LLC, as the initial member of the Company (the "Initial
Member"), (ii) the persons and entities named in Part 2 of Schedule II hereto
(the "Additional Members") that execute and deliver this Agreement on or prior
to February 28, 2002 (or such later date as may be determined by the Initial
Member), amending and restating the Memorandum of Limited Liability Company
Agreement of Valor Telecommunications Southwest II, LLC, dated as of June 8,
2001 (the "Original Agreement"), by the Initial Member. The Additional Members
and the Initial Member are hereinafter referred to as the "Members", which term
shall include any other persons or entities admitted as substitute or additional
Members after the date of this Agreement, and shall exclude any persons who
cease to be Members).
The Company was formed on June 8, 2001 by the Initial Member as a
sole member limited liability company pursuant to the Delaware Limited Liability
Company Act (the "Delaware Act"), Del. Code ▇▇▇. tit. 6 Section 18-101 et seq.
Pursuant to the Original Agreement, the Initial Member contributed to the
Company the amount set forth opposite its name on Schedule I hereto in the
column labeled "Description of Initial Capital Contribution" (the Initial
Member's "Initial Investment"). The Members desire to amend and restate the
Original Agreement to provide for (i) the purchase for cash and in exchange for
its membership interest attributable to its Initial Investment by the Initial
Member of the Class B Common Interests and the Preferred Interests (as such
terms are hereinafter defined) of the Company set forth opposite the name of the
Initial Member on Schedule III hereto and (ii) the purchase for cash by each of
the Additional Members of the Class A Non Voting Common Interests of the Company
set forth opposite the name of such Additional Member Schedule III hereto, all
in accordance with the terms of this Agreement and the Subscription Agreement
dated as of the date hereof (the "Southwest II Subscription Agreement") among
the Initial Member, the Additional Members and the Company.
The Company has filed a Form 8832 with the Internal Revenue Service
electing for federal income tax purposes to be an association taxable as a
corporation.
Capitalized terms used herein have the meanings ascribed to them in
Article IX hereof.
ARTICLE I
THE COMPANY - FORMATION AND PURPOSES
I.1 Formation and Continuation
(a) The Members hereby execute this Agreement for the purpose of
setting forth the rights and obligations of the Members and to continue the
business of the Company. The Certificate of Formation of the Company (the
"Certificate of Formation") was duly executed and filed with the Delaware
Secretary of State pursuant to the Delaware Act on June 8, 2001.
(b) Each Member confirms and agrees to such Member's status as a
Member and subscribes for the acquisition of the Interests described herein upon
the terms and conditions set forth in this Agreement and the Subscription
Agreement.
(c) The Members hereby execute and adopt this Agreement as a limited
liability company agreement of the Company pursuant to Section 18-201 of the
Delaware Act.
I.2 Name
The name of the Company shall be "Valor Telecommunications Southwest
II, LLC".
I.3 Principal Office
The principal office of the Company shall be located at Las Colinas
Tower ▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇. The location of
the principal office may be changed to such other place and the Company may have
such other offices wherever located as the Managers may from time to time
determine.
The Company shall have and maintain a registered office in the State
of Delaware, which shall be located in the City of Dover. The Company shall also
have a registered agent for service of process on the Company in the State of
Delaware, and the registered agent in Delaware initially shall be United States
Corporation Service Company, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
SOUTHWEST II
I.4 Effective Date; Duration
This Agreement shall take effect upon the execution and delivery of
this Agreement by the parties hereto and shall continue until terminated in
accordance with Article V. The term of the Company commenced on June 8, 2001,
the date upon which the Certificate of Formation of the Company was duly filed
and recorded in the office of the Secretary of State of the State of Delaware.
I.5 Fiscal Year The fiscal year of the Company shall be the calendar
year, or such other period as may be designated from time to time by the
Managers.
1.6 Purposes
The Company has been formed for the purposes of (i) acquiring,
holding, exercising all rights, powers, privileges and other incidents of
ownership or possession with respect to (A) Valor Telecommunications Enterprises
II, LLC, which has entered into the Stock Purchase Agreement described in
Schedule IV hereto (the "Kerrville Stock Purchase Agreement") to acquire all the
issued and outstanding capital stock of Kerrville Communications Corporation, a
Texas corporation ("Kerrville") and (B) one or more additional entities to be
organized and operated from time to time by the Company or such limited
liability company, limited partnership or other entity at the discretion of the
Managers, (ii) carrying on any other lawful business, purpose or activity
permitted to be carried on by limited liability companies under the Delaware
Act, and (iii) possessing and exercising all the powers and privileges granted
by Section 18-106(b) of the Delaware Act so far as necessary or convenient to
the attainment of the purposes set forth in the foregoing clauses (i) and (ii).
I.7 Organizational Expenses. The Company shall be solely responsible
for the expenses of organizing the Company.
I.8 Seal of the Company. The Managers may adopt a seal, alter such
seal at its pleasure and authorize it to be used by causing it or a facsimile to
be affixed or impressed or reproduced in any other manner.
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ARTICLE II
MANAGEMENT AND OPERATION OF THE COMPANY
II.I Power and Authority of Members. Except when a vote of the Members
is required as provided in Section 2.7 (b)(iii), the Members shall manage the
Company only through their designated Managers on the Board of Managers of the
Company (the "Managers"). Subject as aforesaid, the Members, in their capacity
as such, shall have no authority or right to act on behalf of or bind the
Company in connection with any matter.
II.2 Power and Authority of the Managers. The business and affairs of
the Company shall be managed by or under the direction of the Managers, except
as may be otherwise provided in this Agreement. The Managers shall have the
power on behalf and in the name of the Company to carry out any and all of the
objects and purposes of the Company contemplated by Section 1.6 and to perform
all acts which the Managers may deem necessary or advisable in connection
therewith. The Members agree that, subject to the terms of this Agreement, all
determinations, decisions and actions made or taken by the Managers (or their
designee(s)) shall be conclusive and absolutely binding upon the Company, the
Members (but only in their capacity as such) and their respective successors,
assigns and personal representatives.
II.3 Members.
(a) Names and Addresses of Members. The name and present mailing
address of each Member are set forth on Schedule II hereto.
(b) Rights and Obligations; Classes of Members.
(i) Each Member shall have the rights, powers, duties and
obligations provided herein for a Member.
(ii) The Members shall be divided into separate classes,
depending upon the class of Interests held by them, holders of Class A Non
Voting Common Interests being referred to herein as "Class A Common
Members", holders of Class B Common Interests being referred to herein as
"Class B Common Members" and together with the Class A Common Members, the
"Common Members" and holders of Preferred Interests being referred to
herein as "Preferred Members".
(c) Meetings of Members. Meetings of Members shall be called for the
purpose of filling any vacancy created by the resignation or removal of any
Manager or for such other purposes as may be required by law or as may be
otherwise required or permitted by this
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Agreement. Such meetings may be held at such time and place, within or without
the State of Delaware, as shall be stated in a notice of meeting or in a duly
executed waiver of notice thereof and shall be called by vote of the Managers,
the Chief Executive Officer or by the holders of not less than a majority of the
Class B Common Interests outstanding.
(d) Place of Meetings. The Managers may designate any place, either
within or outside of the State of Delaware, as the place of meeting for any such
meeting called by them. If no designation is made, or if a meeting be otherwise
called, the place of meeting shall be the principal executive office of the
Company.
(e) Notice. Whenever Members or any Class of Members are required or
permitted to take action at a meeting, written or printed notice stating the
place, date, time, and, in the case of special meetings, the purpose or purposes
of such meeting, shall be given to each Member entitled to vote at such meeting
and to each Manager not less than five nor more than 30 days before the date of
the meeting. All such notices shall be delivered, either personally, by
overnight courier service, by mail or, if any Member has notified the Company in
writing of an electronic mail address that may be used for such purpose, by
electronic mail, by or at the direction of the Managers, the Chief Executive
Officer, or the Secretary. If sent by overnight courier service, such notice
shall be deemed to be delivered on the day when delivered to such service, if
mailed, such notice shall be deemed to be delivered two days after the date when
deposited in the United States mail, first-class mail postage prepaid, addressed
to the Member at his, her or its address as the same appears on the records of
the Company; and if sent by electronic mail, such notice shall be deemed to be
delivered on the day when sent to the electronic mail address last notified by
the Member to the Company as aforesaid. Attendance of a person at a meeting
shall constitute a waiver of notice of such meeting, except when the person
attends for the express purpose of objecting at the beginning of the meeting to
the transaction of any business because the meeting is not lawfully called or
convened.
(f) Quorum. The holders of a majority of the Class B Common
Interests, present in person or represented by proxy, shall constitute a quorum
at all meetings of the Members, and the holders of a majority of the Interests
of any Class, present in person or represented by proxy, shall constitute a
quorum at all meetings of such Class. If a quorum is not present, the holders of
a majority of the Interests present in person or represented by proxy at the
meeting may adjourn the meeting to another time and/or place. When a quorum is
once present to commence a meeting of Members, or any Class of Members, the
quorum shall not be broken by the subsequent withdrawal of any Members or their
proxies, unless the requisite Members whose affirmative vote with respect to any
particular matter is required to vote on such matters shall not be present at
the time such vote is to be taken.
(g) Adjourned Meetings. If at any meeting of Members or any Class of
Members there shall be less than a quorum present, a majority of the Members
present in person or by proxy, may adjourn the meeting from time to time until a
quorum with respect to such
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matter shall be present. When a meeting is adjourned to another time and place,
notice of the adjourned meeting shall be given to each Member entitled to vote
at the original meeting of the adjourned meeting in the manner provided for the
calling of meetings set forth in Section 2.3(e). At the adjourned meeting the
Company may transact any business that might have been transacted at the
original meeting.
(h) Vote Required. When a quorum is present at a meeting of all
Members, the affirmative vote of the holders of a majority of the Class B Common
Interests present in person or represented by proxy at a duly called meeting and
entitled to vote on the subject matter shall be the act of the Members, unless
the question is one upon which by express provisions of an applicable law or of
this Agreement a different vote is required, in which case such express
provision shall govern and control the decision of such question. Where a
separate vote by Class is required, the affirmative vote of the majority of
Interests of such Class present in person or represented by proxy at the meeting
of such Class shall be the act of such Class, unless the question is one upon
which by express provisions of an applicable law or of this Agreement a
different vote is required, in which case such express provision shall govern
and control the decision of such question.
(i) Action by Written Consent. Unless otherwise provided in the
Delaware Act, any action required to be taken at any meeting of Members, or at
any meeting of any Class of Members, or any action that may be taken at any
meeting of such Members or Class of Members, may be taken without a meeting,
without prior notice and without a vote, if a consent or consents in writing,
setting forth the action so taken and bearing the dates of signature of the
Members who signed the consent or consents, shall be signed by the holders of
not less than the minimum Interests or Class of Interests that would be
necessary to authorize or take such action at a meeting at which all Interests
entitled to vote thereon were present and voted and shall be delivered to the
Company by delivery to the Company's principal place of business, or an officer
or agent of the Company having custody of the book or books in which proceedings
of meetings of the Members are recorded. If action is so taken without a meeting
by less than unanimous written consent of the Members or of any Class, a copy of
such written consent shall be delivered promptly to all Members or all Members
of such Class, who have not consented in writing. Any action taken pursuant to
such written consent or consents of the Members or any Class of Members shall
have the same force and effect as if taken by the Members at a meeting of the
Members or such Class.
(j) Record Dates. For purposes of determining the Members entitled
to notice of or to vote at a meeting of Members or any Class of Members or to
give approvals without a meeting as provided in Section 2.3(i), the Managers may
set a record date, which shall not be less than two nor more than 60 days before
(i) the date of the meeting or (ii) in the event that approvals are sought
without a meeting, the date by which Members are requested in writing by the
Managers to give such approvals.
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SOUTHWEST II
(k) Conference Participation. The Members may participate in and act
at any meeting of such Members or any Class of Members through the use of a
conference telephone or other communications equipment by means of which all
persons participating in the meeting can hear each other, and participating in
the meeting pursuant to this Section 2.3(k) shall constitute presence in person
at the meeting.
II.4 Intentionally Omitted
II.5 Intentionally Omitted
II.6 Managers; Number, Appointment, Removal, Qualifications, Etc.
(a) Board of Managers. The number of Managers shall be five (5) who
shall be designated by Majority Vote of the Class B Common Members. The persons
named in Annex A hereto are hereby designated by the Class B Common Members as
the initial Managers of the Company. The business address of each Manager is set
forth opposite such Manager's name on said ▇▇▇▇▇ A. Managers appointed pursuant
to this Agreement shall be managers for purposes of the Delaware Act.
(b) Alternate Managers. An alternate Manager may be appointed by
Majority Vote of the Class B Common Members to act for and fulfill the
obligations of any Manager in the event that such Manager is unable to attend
any meeting of the Managers or any committee thereof. Any such alternates shall
be specified in writing by such Class B Common Members to the Secretary of the
Company. Any appointment of an alternate Manager maybe changed by Majority Vote
of the Class B Common Members.
(c) Removal and Resignation. Any one or more Managers may be
removed, with or without cause, at any time by Majority Vote of the Class B
Common Members acting in person or by proxy at a meeting of Class B Common
Members or (ii) by a consent in writing in the manner contemplated in Section
2.3(i). Any Manager of the Company may resign at any time by giving written
notice to the Chief Executive Officer or the Secretary of the Company. The
resignation of any Manager shall take effect upon receipt of notice thereof or
at such later time as shall be specified in such notice; and, unless otherwise
specified therein, the acceptance of such resignation shall not be necessary to
make it effective. Any vacancy or vacancies in the Managers caused by any such
removal or resignation may be filled in the manner provided in Section 2.6(a).
II.7 Managers; Meetings; Committees and Delegation.
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SOUTHWEST II
(a) Regular and Special Meetings. Regular meetings of the Managers
maybe held at such place, within or without the State of Delaware, as shall from
time to time be determined by the Managers, but shall be held not less than once
per year. After there has been such determination, and notice thereof has once
been given to each Manager as hereinafter provided for special meetings, regular
meetings may be held without further notice being given. Special meetings of the
Managers shall be held whenever called by the Chief Executive Officer or by any
Manager. Notice of each such meeting shall be mailed or sent by overnight
courier service to each Manager addressed to such Manager at his or her
residence or usual place of business, at least five days before the date on
which the meeting is to be held, or shall be sent to such Manager at such place
by telecopier or delivered personally or by telephone, or if any Manager has
notified the Company in writing of an electronic mail address that may be used
for such purpose, sent by electronic mailed to such Manager, not later than five
days (or, in the case of meetings held by telephone, one day) before the day on
which such meeting is to be held. Each such notice shall state the time and
place of the meeting and, as may be required, the purposes thereof. Notice of
any meeting of the Managers need not be given to any Manager if such Manager
shall sign a written waiver thereof either before or after the time stated
therein for such meeting, or if such Manager shall be present at the meeting.
Unless limited by law, this Agreement or the terms of the notice thereof, any
and all business may be transacted at any meeting without the notice thereof
having specifically identified the matters to be acted upon.
(b) ▇▇▇▇▇▇ and ▇▇▇▇▇▇ of Acting. Unless otherwise provided by law or
this Agreement, the presence of Managers constituting a majority of the Managers
then in office shall be necessary to constitute a quorum for the transaction of
business. In the absence of a quorum, a majority of the Managers present may
adjourn the meeting from time to time until a quorum shall be present. Notice of
any adjourned meeting shall be given in the manner provided in Section 2.7(a).
At all duly convened meetings of Managers, a quorum being present and acting
throughout, all matters shall be decided by the affirmative vote of a majority
of the Managers present, except as otherwise required by law or by this
Agreement.
(c) Committees. The Managers may designate one or more committees,
each committee to consist of two or more of the Managers, which to the extent
provided in the resolution designating any such committee shall have and may
exercise the powers of the Managers in the management and affairs of the Company
except as otherwise limited by law. The Managers may designate one or more
Managers as alternate members of any such committee, who may replace any absent
or disqualified Manager at any meeting of such committee. Such committee or
committees shall have such name or names as may be determined from time to time
by resolution adopted by the Managers. Each committee of Managers may fix its
own rules of procedure and shall hold its meetings as provided by such rules,
except as may otherwise be provided by the resolution of the Managers
designating such committee. Unless otherwise provided in such resolution, the
presence of at least a majority of the members of the committee shall be
necessary to constitute a quorum.
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(d) Conference Participation. Managers and any committee thereof may
participate in and act at any meeting of Managers or committee through the use
of a conference telephone or other communications equipment by means of which
all persons participating in the meeting can hear each other, and participation
in the meeting pursuant to this Section 2.7(d) shall constitute presence in
person at the meeting.
(e) Waiver of Notice and Presumption of Assent. Any Manager or any
member of a committee of the Managers who is present at a meeting shall be
conclusively presumed to have waived notice of such meeting except when such
Manager attends for the express purpose of objecting at the beginning of the
meeting to the transaction of any business because the meeting is not lawfully
called or convened. Such Manager shall be conclusively presumed to have assented
to any action taken unless his or her dissent shall be entered in the minutes of
the meeting or unless his or her written dissent to such action shall be filed
with the person acting as the secretary of the meeting before the adjournment
thereof or shall be forwarded by registered mail to the Secretary of the Company
immediately after the adjournment of the meeting. Such right to dissent shall
not apply to any member who voted in favor of such action.
(f) Action by Written Consent. Unless otherwise restricted by this
Agreement or the Delaware Act, any action required or permitted to be taken at
any meeting of the Managers, or of any committee thereof, may be taken without
prior notice and without a vote, if a consent in writing, setting forth the
action so taken bearing the dates of signature of the Managers who signed the
consent or consents, shall be signed by not less than the minimum number of
Managers that would be necessary to authorize or take such action at a duly
convened meeting of the Managers at which all the Managers then in office were
present and acting throughout and shall be delivered to the Company by delivery
to the Company's principal place of business, or an officer or agent of the
Company having custody of the book or books in which proceedings of meetings of
the Managers are recorded. If action is so taken without a meeting by less than
unanimous written consent, a copy of such written consent shall be delivered
promptly to all Managers who have not consented in writing. Any action taken
pursuant to such written consent or consents of the Managers shall have the same
force and effect as if taken by the Managers at a meeting thereof.
II.8 Officers.
(a) Establishment, Nomination and Election. The officers of the
Company shall be elected by the Managers and may, at the discretion of the
Managers, consist of a Chief Executive Officer, a President, a Secretary, a
Treasurer, one or more Vice Presidents, Assistant Secretaries, Assistant
Treasurers and such other officers and assistant officers as may be deemed
necessary or desirable by the Managers. One person may hold, and perform the
duties of, any two or more of said offices. In their discretion, the Managers
may choose not to fill any office for any period as they may deem advisable. The
initial officers of the Company are set forth in Annex B.
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(b) Election and Term of Office. The officers of the Company shall
be elected annually by the Managers at the annual meeting thereof. Each such
officer shall hold office until his or her successor shall have been elected and
shall qualify, or until his or her earlier death, resignation or removal.
(c) Removal. Subject to the terms of any employment agreement
between the Company and any officer of the Company, any officer may be removed,
either with or without cause, at any time, by the Managers at any regular
meeting of the Managers, or at any special meeting of the Managers called for
that purpose, at which a quorum is present.
(d) Resignations. Any officer may resign at any time by giving
written notice to the President, the Secretary or the Managers. Any such
resignation shall take effect upon receipt of such notice or at any later time
specified therein; and, unless otherwise specified therein, the acceptance of
such resignation shall not be necessary to make it effective.
(e) Vacancies. A vacancy in any office may be filled for the
unexpired portion of the term in the manner prescribed in this Agreement for
election or appointment to such office for such term.
(f) Chief Executive Officer. The Chief Executive Officer shall serve
as the chief executive officer of the Company and shall in general supervise all
the business affairs of the Company, subject to the powers of the Managers. The
Chief Executive Officer shall preside at meetings of the Board, the Managers and
the Members and shall have such other powers and perform such other duties
consistent with such position as may be prescribed by the Managers or provided
in this Agreement.
(g) President. The President shall, subject to the powers of the
Managers and the Chief Executive Officer, have such general charge of the
business, affairs and property of the Company, and such control over its
officers, agents and employees as shall be assigned to him or her by the
Managers, the Chief Executive Officer; and shall see that all orders and
resolutions of the Managers and the Chief Executive Officer are carried into
effect. Subject as aforesaid, the President shall execute bonds, mortgages and
other contracts requiring a seal, under the seal of the Company, except where
required or permitted by law to be otherwise signed and executed and except
where the signing and execution thereof shall be expressly delegated by the
Managers or the Chief Executive Officer to some other officer or agent of the
Company.
(h) Vice President. Each Vice President shall have such powers and
shall perform such duties as shall be assigned to him or her by the Chief
Executive Officer, the President or the Managers.
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(i) Treasurer. The Treasurer shall have charge and custody of, and
be responsible for, all funds and securities of the Company. The Treasurer shall
exhibit at all reasonable times the Company's books of account and records to
any of the Managers upon application during business hours at the office of the
Company where such books and records shall be kept; when requested by the
Managers, the Treasurer shall render a statement of the condition of the
finances of the Company at any meeting of the Managers, the Board or at the
annual meeting of Members; the Treasurer shall receive, and give receipt for,
moneys due and payable to the Company from any source whatsoever; and in
general, the Treasurer shall perform all the duties incident to the office of
Treasurer and such other duties as from time to time may be assigned to him or
her by the President or the Managers. The Treasurer shall give such bond, if
any, for the faithful discharge of the Treasurer's duties as the Managers may
require.
(j) Secretary. The Secretary, if present, shall act as secretary at
all meetings of the Board, the Managers and the Members and keep the minutes
thereof in a book or books to be provided for that purpose; the Secretary shall
see that all notices required to be given by the Company are duly given and
served; the Secretary shall have charge of the records of Interests in the
Company. The Secretary shall see that all reports, statements and other
documents required by law are properly kept and filed, and in general the
Secretary shall perform all the duties incident to the office of Secretary and
such other duties as from time to time may be assigned to the Secretary by the
President or the Managers.
(k) Other Officers, Assistant Officers and Agents. Officers,
assistant officers and agents, if any, other than those whose duties are
provided for in this Agreement, shall have such authority and perform such
duties as may from time to time be prescribed by the Managers.
(l) Compensation. Compensation of all officers shall be fixed by the
Managers or a duly authorized Committee thereof, and no officer shall be
prevented from receiving such compensation by virtue of his or her also being a
Manager of the Company.
(m) Absence or Disability of Officers. In the case of the absence or
disability of any officer of the Company and of any person hereby authorized to
act in such officer's place during such officer's absence or disability, the
Managers may delegate the powers and duties of such officer to any other officer
or to any Manager, or to any other person whom it may select.
II.9 Liability of Members and Managers. No Member or Manager shall
have any liability under this Agreement except as provided in Section 2.10 or
elsewhere herein or as required by the Delaware Act. Except as required by the
Delaware Act, the debts, obligations and liabilities of the Company, whether
arising in contract, tort or otherwise (including without limitation those
arising as member, owner or shareholder of another company, partnership or
entity), shall be solely the debts, obligations and liabilities of the Company,
and no Member or Manager shall be obligated personally for any such debt,
obligation or liability of the Company solely by reason of being a
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Member or acting as a Manager of the Company. No Member or Manager shall be
liable for any debts, obligations and liabilities, whether arising in contract,
tort or otherwise, of any other Member or Manager.
II.10 Certain Duties and Liabilities of Managers and Officers.
(a) Duties of Managers and Officers. Except as otherwise
specifically provided in this Agreement, the duties and obligations owed to the
Company and to the Members by the Managers and officers of the Company shall be
the same as the respective duties and obligations owed to a corporation
organized under the Delaware General Corporation Law by its directors and
officers. No person shall be personally liable to the Company or its Members for
monetary damages for breach of fiduciary duty as a Manager; provided, however,
that the foregoing shall not eliminate or limit the liability of a Manager (i)
for any breach of the Manager's duty of loyalty to the Company or its Members
(ii) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under the circumstances
described in Section I74 of the Delaware General Corporation Law or (iv) for any
transaction from which the Manager derived an improper personal benefit. If the
Delaware General Corporation Law is subsequently amended to further eliminate or
limit the liability of a director of a corporation then a Manager of the
Company, in addition to the circumstances in which a Manager is not personally
liable as set forth in the preceding sentence, shall not be liable to the
fullest extent permitted by the amended Delaware General Corporation Law as if
such Manager was subject thereto.
(b) Limitations on Liability of Managers and Officers. To the extent
that any Manager or officer has duties (including fiduciary duties) and
liabilities relating thereto to the Company or to a Member (i) any such Manager
or officer acting under this Agreement shall not be liable to the Company or to
any other Member for the Manager's or officer's good faith reliance on the
provisions of this Agreement, the records of the Company and such information,
opinions, reports or statements presented to the Company by any of the Company's
officers or employees, or committees of the Managers or the Board, or by any
other person as to matters the Manager or officer reasonably believes are within
such other person's professional or expert competence and who has been selected
with reasonable care by or on behalf of the Company, and (ii) the Manager's or
officer's duties and liabilities are restricted by the provisions of this
Agreement to the extent that such provisions restrict the duties and liabilities
of the Directors, Managers or officers otherwise existing at law or in equity.
II.11 Reliance by Third Parties. Persons dealing with the Company
are entitled to rely conclusively upon the power and authority of the Managers
and officers as herein set forth. Persons dealing with the Company are entitled
to rely conclusively upon a certificate of any Secretary or Assistant Secretary
as to the incumbency of any Manager, officer or other personnel of the Company.
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II.12 Books and Records. The Company shall keep (i) correct and
complete books and records of account, (ii) minutes of the proceedings of
meetings of the Members, the Board and the Managers and any committee thereof,
and (iii) a current list of the Managers and officers and their residence
addresses; and the Company shall also keep at its principal executive office a
record containing the names and addresses of all Members, the total Interests
held by each Member, the number thereof that are Class A Non-Voting Common
Interests, Preferred Interests and Class B Common Interests, and the dates when
they respectively became the owners of record thereof (the "Members' Interest
Register"). Any of the foregoing books, minutes or records may be in written
form or in any other form capable of being converted into written form within a
reasonable time.
II.13 Indemnification.
(a) Third Party Actions, Suits and Proceedings. Each person who was
or is made a party or is threatened to be made a party to or is involved in any
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Company), by
reason of the fact that he or she, or a person of whom he or she is the legal
representative, is or was a Manager or officer of the Company, or is or was
serving at the request of the Company as a manager, director, officer, employee,
fiduciary or agent of another limited liability company or of a corporation,
partnership, joint venture, trust or other enterprise (hereinafter, a
"proceeding"), shall be indemnified and held harmless by the Company against all
expenses (including attorneys' fees) judgments, fines and amounts paid in
settlement actually and reasonably incurred by such person in connection with
such proceeding if such person acted in good faith and in a manner such person
reasonably believed to be in or not opposed to the best interests of the
Company, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe such person's conduct was unlawful. The termination
of any action, suit or proceeding by judgment, order, settlement, conviction, or
upon a plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which such
person reasonably believed to be in or not opposed to the best interests of the
Company, or, with respect to any criminal action or proceeding that the person
had reasonable cause to believe that his or her conduct was unlawful.
(b) Actions by the Company. The Company shall indemnify any person
who was or is a party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the Company to procure
a judgment in its favor by reason of the fact that such person, or a person of
whom he or she is the legal representative, is or was a Manager or officer of
the Company, or is or was serving at the request of the Company as a manager or
director, officer, employee, fiduciary or agent of another limited liability
company or of a corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and reasonably
incurred by such person in connection with the defense or settlement of such
action or suit if such person acted in good faith and in a manner such person
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SOUTHWEST II
reasonably believed to be in or not opposed to the best interests of the Company
and except that no indemnification shall be made in respect of any claim, issue
or matter as to which such person shall have been adjudged to be liable to the
Company unless and only to the extent that the Court of Chancery of the State of
Delaware or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Court of Chancery or such other court
shall deem proper.
(c) Procedure for Indemnification. Any indemnification of a Manager
or officer of the Company under Section 2.13(a) or 2.13(b) or advance of
expenses under Section 2.13(f) shall be made promptly, and in any event within
30 days, upon the written request of the Manager or officer. If a determination
by the Company that the Manager or officer is entitled to indemnification
pursuant to this Section 2.13 is required, and the Company fails to respond
within 90 days to a written request for indemnity, the Company shall be deemed
to have approved the request. If the Company denies a written request for
indemnification or advancing of expenses, in whole or in part, or if payment in
full pursuant to such request is not made within 30 days, the right to
indemnification or advances as granted by this Section 2.13 shall be enforceable
by the Manager or officer in any court of competent jurisdiction. Such person's
costs and expenses incurred in connection with successfully establishing his or
her right to indemnification, in whole or in part, in any such action shall also
be indemnified by the Company. It shall be a defense to any such action (other
than an action brought to enforce a claim for expenses incurred in defending any
proceeding in advance of its final disposition where the required undertaking,
if any, has been tendered to the Company) that the claimant has not met the
standards of conduct that would make it permissible under the Delaware General
Corporate Law if the Company were a corporation for the Company to indemnify the
claimant for the amount claimed, but the burden of such defense shall be on the
Company. Neither the failure of the Company (including its Managers or
independent legal counsel or Members) to have made a determination prior to the
commencement of such action that indemnification of the claimant is proper in
the circumstances because he or she has met the standard of conduct set forth
for a director or officer of a corporation in the Delaware General Corporate
Law, nor an actual determination by the Company (including its Managers,
independent legal counsel or Members) that the claimant has not met such
applicable standard of conduct, shall be a defense to the action or create a
presumption that the claimant has not met the applicable standard of conduct.
(d) Rights Non-exclusive. The rights to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its final
disposition conferred in this Section 2.13 shall not be exclusive of any other
right which any person may have or hereafter acquire under any statute,
provision of this Agreement, agreement, vote of Members or Managers or
otherwise.
(e) Insurance. The Company shall purchase and maintain insurance, to
the extent such insurance is available to the Company at a reasonable cost, on
its own behalf and on
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behalf of any person who is or was a Manager, officer, employee, fiduciary or
agent of the Company or was serving at the request of the Company as a manager,
director, officer, employee or agent of another limited liability company,
corporation, partnership, joint venture, trust or other enterprise against any
liability asserted against him or her and incurred by him or her in any such
capacity, whether or not the Company would have the power to indemnify such
person against such ▇▇▇▇▇▇▇▇▇ under this Section 2.13.
(f) Expenses. Expenses incurred by any person described in Section
2.13(a) or Section 2.13(b) in defending a proceeding shall be paid by the
Company in advance of such proceeding's final disposition upon receipt of an
undertaking by or on behalf of the Manager or officer to repay such amount if it
shall ultimately be determined that he or she is not entitled to be indemnified
by the Company. Such expenses incurred by other employees and agents may be so
paid upon such terms and conditions, if any, as the Managers deem appropriate.
(g) Employees and Agents. Persons who are not covered by the
foregoing provisions of this Section 2.13 and who are or were Members, employees
or agents of the Company, or who are or were serving at the request of the
Company as employees or agents of another limited liability company,
corporation, partnership, joint venture, trust or other enterprise, may be
indemnified to the extent authorized at any time or from time to time by the
Managers.
(h) Contract Rights. The provisions of this Section 2.13 shall be
deemed to be a contract right between the Company and each Manager or officer
who serves in any such capacity at any time while this Section 2.13 and the
relevant provisions of the Delaware Act or other applicable law are in effect,
and any repeal or modification of this Section 2.13 or any such law shall not
affect any rights or obligations then existing with respect to any state of
facts or proceeding then existing. The indemnification and other rights provided
for in this Section 2.13 shall inure to the benefit of the heirs, executors and
administrators of any person entitled to such indemnification. Except as
provided in Section 2.13(c) hereof, the Company shall indemnify any such person
seeking indemnification in connection with a proceeding initiated by such person
only if such proceeding was authorized by the Managers.
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(i) Merger or Consolidation; Other Enterprises. For purposes of this
Section 2.13, references to "the Company" shall include, in addition to the
resulting company, any constituent company (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have had power and authority to indemnify its
managers, directors, officers, employees or agents, so that any person who is or
was a manager, director, officer, employee or agent of such constituent company,
or is or was serving at the request of such constituent company as a director,
officer, employee or agent of another company, partnership, joint venture, trust
or other enterprise, shall stand in the same position under this Section 2.13
with respect to the resulting or surviving company as he or she would have with
respect to such constituent company if its separate existence had continued. For
purposes of this Section 2.I3, references to "other enterprises" shall include
employee benefit plans; references to "fines" shall include any excise taxes
assessed on a person with respect to any employee benefit plan; and references
to "serving at the request of the Company" shall include any service as a
manager, director, officer, employee or agent of the Company that imposes duties
on, or involves services by, such manager, director, officer, employee or agent
with respect to an employee benefit plan, its participants or beneficiaries; and
a person who acted in good faith and in a manner such person reasonably believed
to be in the interest of the participants and beneficiaries of an employee
benefit plan shall be deemed to have acted in a manner "not opposed to the best
interests of the Company" as referred to in this Section 2.13.
II.14 Corporate Opportunity. No Manager of the Company shall be in
breach of his or her duty of loyalty to the Company solely by reason of having
pursued a business opportunity that has come to him or her without first
offering such business opportunity to the Company, unless such business
opportunity has come to the attention of such Manager as a result of his or her
access to the confidential information belonging to the Company. Notwithstanding
the foregoing, a business opportunity shall cease to be a corporate opportunity
of the Company at any time after the Company has determined not to pursue such
business opportunity, whereupon the Manager that introduced such corporate
opportunity to the Company shall be entitled to treat such business opportunity
as his or her own.
II.15 Intentionally Omitted.
II.16 Certain Policies. It is the intention of the Company to afford
equal employment opportunities to all prospective employees of the Company and,
at the same time, to promote the hiring of minority employees and the retention
of minority-owned businesses. It is the express policy of the Company,
consistent with the Company's need to employ qualified individuals in its
business, to reflect in its hiring the diversity of the population in the
communities in which the Company operates from time to time, to apply this
policy in the conduct of all its employment practices, and otherwise to operate
its business in accordance with applicable law.
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ARTICLE III
CAPITAL CONTRIBUTIONS
III.1 Form of Contribution. The contribution with respect to each
Member of the Company may, as determined by the Managers in their discretion, be
made in cash or other legal consideration.
III.2 Non-Cash Contributions by the Initial Member. The Initial
Member is making a Capital Contribution of its membership interest in the
Company attributable to its Initial Investment on the date hereof. In addition,
the Initial Member has agreed to make a Capital Contribution in cash as set
forth in Section 3.3.
III.3 Cash Contributions by the Members; Payment of Capital
Contributions; Capital Commitment Calls.
(a) General. Each Member has agreed to make a Capital Contribution
in cash to the Company in the aggregate amount set forth opposite such Member's
name on part 1 of Schedule III hereto in the column labeled "Capital Commitment"
in consideration of the number of Class A Non-Voting Common Interests, Class B
Common Interests and Preferred Interests being purchased by such Member set
forth opposite the name of such Member on said Schedule III, in each case in
accordance with the terms of this Agreement and the Subscription Agreement.
(b) Class A Common Members. On or before February 28, 2002, each
Class A Common Member shall contribute to the Company as payment in full of such
Member's Capital Contribution in respect of such Member's Class A Non-Voting
Common Interests the amount set forth opposite such Member's name on Schedule
III hereto under the columns labeled "Class A Common Cash Contribution".
(c) Class B Common Members; Preferred Members. On or before the date
of the "Closing" to occur under the Kerrville Stock Purchase Agreement (the
"Closing Date"), each Class B Common Member and Preferred Member shall
contribute to the Company as payment in full of such Member's Capital
Contribution in respect of such Member's Class B Common Interests and Preferred
Interests, as the case may be, the amount set forth opposite such Member's name
on Schedule III hereto under the columns labeled "Class B Common Cash
Contribution" and "Preferred Cash Contribution", respectively.
III.4 Intentionally Omitted.
III.5 Withdrawal of Capital; Limitation on Distributions No Member
shall be entitled to withdraw any part of its Capital Contribution to, or to
receive any distribution from the Company
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except as provided in Article IV. No Member shall be entitled to demand or
receive (i) except as otherwise permitted herein, interest on such Member's
Capital Contribution or (ii) any property from the Company other than cash.
III.6 New Members. Upon the admission of any additional Member to
the Company pursuant to Section 7.1, Schedule III shall be amended to reflect
the Capital Commitment of such Member or the allocation to such Member of such
portions of (i) the Capital Commitments of the Members theretofore admitted to
the Company and (ii) the Interests held by such Members as shall be agreed to by
the Managers. The Capital Commitments of the Members in the amounts set forth on
Schedule III, as amended in accordance herewith, shall be deemed for the
purposes of this Agreement as the respective Capital Commitments of the Members.
III.7 Intentionally Omitted.
III.8 Distributions.
(a) Distributions Made in Same Manner as Payment Following
Liquidation Events. Distributions shall be made at such time and in such amounts
as determined by the Managers and shall be made among the Members on the same
basis as set forth in Article IV with respect to payments following a
Liquidation Event or, in the case of a redemption of Preferred Interests, with
respect to payments to be made upon such redemption.
(b) Restoration of Funds. Except as otherwise provided by law, no
Member shall be required to restore to the Company any funds properly
distributed to it pursuant to Sections 3.12(a) and (b).
III.9 Withholding. The Company shall comply with withholding
requirements under U.S. federal, state and local law and shall remit amounts
withheld to and file required forms with applicable jurisdictions. To the extent
that the Company is required to withhold and pay over any amounts to any
authority with respect to distributions to any Member, the amount to be withheld
shall be deducted from such distribution to the Member. To the fullest extent
permitted by law, in the event of any claimed over-withholding, Members shall be
limited to an action against the applicable jurisdiction. If the amount to be
withheld was not withheld from actual distributions, the Company may deduct such
amount from subsequent. Each Member, by its acceptance of an Interest in the
Company, shall be deemed to agree to furnish the Company with any
representations and forms as shall reasonably be requested by the Company to
assist it in determining the extent of, and in fulfilling, its withholding
obligations.
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ARTICLE IV
INTERESTS AND OTHER SECURITIES
IV.1 Preferred and Common Interests.
(a) Classes of Interests. The Interests in the Company shall be
divided into three classes: Preferred Interests (the "Preferred Interests"),
Class A Non-Voting Common Interests (the "Class A Non-Voting Common Interests")
and Class B Common Interests (the "Class B Common Interests" and, collectively
with the Preferred Interests and the Class A Non-Voting Common Interests, the
"Interests"). Interests may, at the discretion of the Managers, be represented
by certificates evidencing any number of whole Preferred Interests, Class A
Non-Voting Common Interests or Class B Common Interests, as the case maybe. The
total number of Interests which the Company has the authority to issue is
100,000,000 Preferred Interests, 240,000 Class A Non-Voting Common Interests,
and 400,000,000 Class B Common Interests.
(b) Option Plan Interests. The Company shall reserve from time to
time such number of Common Interests as may be desirable for issuance to
employees of the Company and its subsidiaries pursuant to any one or more option
plans approved by the Managers for adoption from time to time by the Company.
(c) Future Issuances of Interests. The Managers may provide for the
issuance of any Interests upon the exercise, conversion or exchange of rights of
any options, warrants, convertible debt securities or such other interests or
instruments as the Managers may approve.
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IV.2 Preferred Interests.
(a) Dividends. The holders of the Preferred Interests shall be
entitled to receive, when and as declared by the Board of Directors, out of
funds legally available for such purpose, cash dividends in an amount per
Preferred Interest (the "Preferred Dividend Amount"), calculated in the manner
of, and equal to, interest on the Preferred Capital Amount (as hereinafter
defined) from the date each payment in respect of a Capital Contribution is made
through the date of any Liquidation Event (such Preferred Capital Amount being
determined daily throughout the relevant period) at the rate of 20% per annum,
compounded quarterly (meaning that each quarter such interest rate shall be
applied to the Preferred Capital Amount plus the Preferred Dividend Amount
accrued with respect to all previous quarters). Dividends on the Preferred
Interests shall be cumulative. Except as set forth above, accrued but unpaid
dividends shall not bear interest.
(b) Liquidation. Subject to the priorities and restrictions set
forth in Section 4.6, upon the occurrence of a Liquidation Event, the holders of
the Preferred Interests shall be entitled to be paid an amount equal to the sum
of (i) $1.00 per Preferred Interest (the "Preferred Capital Amount"), and (ii)
the Preferred Dividend Amount accrued through the date of such Liquidation
Event. The aggregate amount payable to the holders of Preferred Interests in
respect of each such Interest as described in this Section 4.2(b) is referred to
herein as the "Preferred Liquidation Amount".
(c) Redemption.
(i) Subject to the priorities and restrictions set forth in Section
4.5 and to any restrictions (including without limitation any requirements
as to the use of proceeds) contained in the Financing Agreement, the
Preferred Interests are redeemable, at a redemption price equal to the
Preferred Liquidation Amount as of and to the date fixed for redemption,
as if such date were the date upon which a Liquidation Event occurred, as
follows:
(A) The Preferred Interests may be redeemed in whole or from time to
time in part at any time (in amounts which shall be 100,000 Preferred
Interests or an integral multiple thereof), at the option of the Company.
(B) The Company shall redeem all of the Preferred Interests then
outstanding on September 3, 2011, or, if the Termination Date (as defined
in the Financing Agreement) has not occurred, on the first anniversary of
the latest date contained in such definition.
(C) The Company shall, upon the occurrence of a Redemption Event,
redeem all of the Preferred Interests then outstanding (or, if the Company
is not permitted by the
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SOUTHWEST II
Financing Agreement to redeem all such Interests, the maximum number of
Preferred Interests so permitted to be redeemed).
(ii) The date of any redemption of any Preferred Interests pursuant
to this Section 4.2(c) is referred to herein as a "Preferred Interest
Redemption Date."
(iii) Any Preferred Interests redeemed pursuant to this Section
4.2(c) or otherwise acquired by the Company in any manner whatsoever shall
be permanently retired and shall not under any circumstances be reissued;
and the Company may from time to time take such appropriate action as may
be necessary to reduce the authorized Preferred Interests accordingly.
(iv) In case of the redemption, purchase or retirement, for any
reason, of only a part of the outstanding Preferred Interests on a
Preferred Interest Redemption Date, subject to the priorities and
restrictions set forth in Section 4.5, all Preferred Interests to be
redeemed, purchased or retired shall be selected pro rata, such that there
shall be redeemed, purchased or retired from each registered holder in
whole Preferred Interests, as nearly as practicable to the nearest whole
Preferred Interest, the proportion of all the Preferred Interests to be
redeemed, purchased or retired which the number of Preferred Interests
held of record by such holder bears to the total number of Preferred
Interests at the time outstanding.
(d) Voting Rights. Except as otherwise provided in this Agreement
and by law, the holders of Preferred Interests shall have no vote in respect
thereof on any matters to be voted on by the Members of the Company.
(e) Restrictions. At any time when Preferred Interests are
outstanding, except where the vote or written consent of the holders of a
greater number of Interests of the Company is required by law or by this
Agreement, and in addition to any other vote required by law, with-out a
Majority Vote of the Preferred Members, given in person or by proxy, either in
writing or at a special meeting of the Preferred Members called for that
purpose:
(i) The Company will not (x) create or authorize the creation of any
additional class of limited liability company interests unless the same
ranks junior to the Preferred Interests both as to dividends and as to the
distribution of assets on liquidation, or (y) increase the authorized
amount of the Preferred Interests, or increase the authorized amount of
any additional class of limited liability company interests unless the
same ranks junior to the Preferred Interests both as to dividends and as
to the distribution of assets on liquidation, or (z) create or authorize
any obligations or securities convertible into Preferred Interests or into
limited liability company interests of the Company of any other class
unless (A) the Tax Matters Partner, as such term is defined in the Second
Amended and Restated Limited Liability Agreement of the Initial Member (as
the same
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may be amended from time to time) shall have consented thereto and (B) the
same ranks junior to the Preferred Interests both as to dividends and as
to the distribution of assets on liquidation, in each case whether any
such creation or authorization or increase shall be by means of amendment
of this Agreement, merger, consolidation or otherwise .
(ii) The Company will not amend, alter or repeal this Agreement in
any manner that affects the respective preferences, voting power,
qualifications, special or relative rights or privileges of the Preferred
Interests, the Class A Non-Voting Common Interests or the Class B Common
Interests or which in any manner adversely affects the Preferred Interests
or the holders thereof.
IV.3 Class A Non-Voting Common Interests.
(a) Dividends. To the extent permitted under the Delaware Act and
subject to the priorities and restrictions set forth in Section 4.5, dividends
may be paid on the Class A Non-Voting Common Interests as and when declared by
the Managers; provided, however, that no dividend shall be declared or paid on
the Class A Non-Voting Common Interests unless there shall be concurrently
declared or paid a dividend on the Class B Common Interests, equal in amount per
Class B Common Interest to the amount of the dividend declared or paid on each
Class A Non-Voting Common Interest.
(b) Liquidation. Subject to the priorities and restrictions set
forth in Section 4.5, upon the occurrence of a Liquidation Event, the holders of
the Class A Non-Voting Common Interests shall be entitled (i) to receive $.50
per Class A Non-Voting Common Interest (the "Class A Common Capital Amount") and
(ii) to share ratably with the holders of the Class B Common Interests, based
upon the number of Common Interests held by them, in all remaining net assets of
the Company available for distribution, as provided in Section 4.5(a)(iii).
(c) Voting Rights. Except as otherwise provided in this Agreement
and by law, the holders of Class A Non-Voting Common Interests shall have no
vote on any matters to be voted on by the Members of the Company.
IV.4 Class B Common Interests.
(a) Dividends. To the extent permitted under the Delaware Act and
subject to the priorities and restrictions set forth in Section 4.5, dividends
may be paid on the Class B Common Interests as and when declared by the
Managers; provided, however, that no dividend shall be declared or paid on the
Class B Common Interests unless there shall be concurrently declared or paid a
dividend on the Class A Non-Voting Common Interests, equal in amount per Class A
Non-Voting Common Interest to the amount of the dividend declared or paid on
each Class B Common Interest.
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(b) Liquidation. Subject to the priorities and restrictions set
forth in Section 4.5, upon the occurrence of a Liquidation Event, the holders of
the Class B Common Interests shall be entitled (i) to receive $1.00 per Class B
Common Interest (the "Class B Common Capital Amount") and (ii) to share ratably
with the holders of the Class A Non-Voting Common Interests, based upon the
number of Common Interests held by them, in all remaining net assets of the
Company available for distribution, as provided in Section 4.5(a)(iii).
(c) Voting Rights. Each Class B Common Interest shall entitle the
holder thereof to one vote upon all matters upon which Class B Common Members
have the right to vote.
IV.5 Priority of Payments Upon Liquidation; Certain Restrictions.
(a) Upon the occurrence of a Liquidation Event (subject to any restrictions
(including without limitation any requirements as to the use of proceeds)
contained in the Financing Agreement), the entire net assets of the Company
available to be distributed among the holders of Interests shall be distributed
as follows:
(i) first, ratably among the holders of Preferred Interests, based
on, and up to the maximum amount of, the Preferred Liquidation Amounts to
which they are respectively entitled as provided in Section 4.2(b)(i);
(ii) then, to the extent that there are net assets of the Company
remaining after payment in full of the Preferred Liquidation Amounts, as
aforesaid, ratably among the holders of the Common Interests, based on,
and up to the maximum amount of, the Class A Common Capital Amounts and
Class B Common Capital Amounts to which they are respectively entitled as
provided in Section 4.3(b)(i) and Section 4.4(b)(i); and
(iii) finally, to the extent of the entire remaining net assets of
the Company, after payment in full of the Preferred Liquidation Amounts,
the Class A Common Capital Amounts and the Class B Common Capital Amounts
as aforesaid, ratably among the holders of the Common Interests, based on
their respective number of Common Interests as provided in Section
4.3(b)(ii) and Section 4.4(b)(ii).
(b) Restrictions on Certain Distributions and Dividends. As long as
any Preferred Interests shall remain outstanding, without a Majority Vote of the
Preferred Members, no dividend shall be declared or paid upon, nor shall any
distribution be made upon, any Common Interests, other than a dividend or
distribution payable solely in Common Interests, nor shall any Common Interests
be purchased or redeemed by the Company (other than repurchases of Common
Interests from employees of the Company following termination of their
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employment), nor shall any moneys be paid to or made available for a sinking
fund for the purchase or redemption of any Common Interest.
IV.6 Certain Notices
(a) Notice of Liquidation. Written notice of any Liquidation Event,
stating a payment date, the amount payable upon such Liquidation Event as
provided in this Article IV to which each holder of Interests is entitled with
respect to each Class of Interest, and the place where said sums shall be
payable, shall be given by mail, postage prepaid, not less than 30 or more than
60 days prior to the payment date stated therein, to all holders of record of
Interests, such notice to be addressed to each such holder at such holder's post
office address as shown by the records of the Company.
(b) Notice of Redemption. Not less than 30 or more than 60 days
before any Preferred Interest Redemption Date, written notice shall be given by
mail, postage prepaid, to the holders of record of the Preferred Interests to be
redeemed, addressed to each such holder at such holder's post office address as
shown by the records of the Company, specifying the number of Preferred
Interests to be redeemed, the redemption price to be paid for such Preferred
Interests, the place and the date (which date shall not be a day on which banks
in The City of New York are required or authorized to close) on which the
Preferred Interests will be redeemed. If such notice of redemption shall have
been duly given and if on or before such Preferred Interest Redemption Date the
funds necessary for redemption shall have been set aside so as to be and
continue to he available therefor, then, notwithstanding that any certificate
for Preferred Interests to be redeemed shall not have been surrendered for
cancellation, after the close of business on such Preferred Interest Redemption
Date, such Preferred Interests shall no longer be deemed outstanding, and all
rights with respect to such Preferred Interests shall forthwith after the close
of business on the Preferred Interest Redemption Date, cease, except only the
right of the holders thereof to receive the redemption price for such Preferred
Interests, without interest.
IV.7 Issuance of Interests Upon the Admission of Additional Members.
Subject to the rights of the existing Members as set forth in this Agreement,
additional Interests may be issued to additional Members only upon the admission
of such additional Member pursuant to Article VII of this Agreement
IV.8 Fractional Interests. The Company may, but shall not be
required to, issue fractions of an Interest. If the Company does not issue
fractions of an Interest, it shall (a) arrange for the disposition of fractional
Interests by those entitled thereto, (b) pay in cash the fair value of fractions
of an Interest as of the time when those entitled to receive such fractions are
determined or (c) issue scrip or warrants in registered form (either represented
by a certificate or uncertificated) which shall entitle the holder to receive a
full Interest upon the surrender of such scrip or warrants aggregating a full
Interest. A certificate
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SOUTHWEST II
for a fractional Interest or an uncertificated fractional Interest shall, but
scrip or warrants shall not unless otherwise provided therein, entitle the
holder to exercise voting rights, to receive dividends thereon and to
participate in any of the assets of the Company in the event of liquidation. The
Managers may cause scrip or warrants to be issued subject to the conditions that
they shall become void if not exchanged for certificates representing the full
Interests or uncertificated full Interests before a specified date, or subject
to the conditions that the Interests for which scrip or warrants are
exchangeable may be sold by the Company and the proceeds thereof distributed to
the holders of scrip or warrants, or subject to any other conditions which the
Managers may impose.
ARTICLE V
DISSOLUTION AND WINDING-UP
V.1 Dissolution. The Company shall be dissolved and its affairs
wound up upon the occurrence of the earliest of following events:
(a) the dissolution or liquidation of the Company;
(b) the Managers shall consent to the dissolution and termination of
the Company; or
(c) as otherwise required by the Delaware Act.
V.2 Resignation of Members. A Member may resign from the Company
only by transferring such Member's interests pursuant to Article VI hereof. No
Member shall be able to resign or be deemed to resign if such Member ceases to
be a Member (a "Former Member") due to bankruptcy or for any other reason except
upon the Majority Vote of the Common Members, if the Company continues to exist.
Such Former Member, if not permitted or deemed to resign, shall not be entitled
to any of the rights granted to a Member hereunder or under applicable law but
shall be, to the extent not otherwise provided by this Agreement or applicable
law, entitled to receive distributions from the Company as if such Former Member
continued to be a Member hereunder.
V.3 Winding-Up.
(a) Upon dissolution of the Company, the Company's affairs shall be
wound up by such person, who shall act as liquidating trustee, as may be
designated by the Managers.
(b) Upon the winding-up of the Company, any amounts permitted to be
distributed to Members shall be distributed in accordance with Section 4.5.
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ARTICLE VI
RESTRICTIONS ON TRANSFER; CERTAIN SALE AND PREEMPTIVE RIGHTS
VI.l General; Tag-Along Rights.
(a) Restrictions on Transfer.
(i) No Additional Member shall be permitted to directly or
indirectly sell, exchange or in any other manner dispose of any Interest
in the Company held by such Member other than in a Permitted Transfer as
contemplated by Section 6.3(a), in an Approved Transaction as contemplated
by Section 6.5 or in any transaction contemplated by Section 6.3(b).
(ii) Subject as aforesaid, if any Member (a "Selling
Investor") is permitted and proposes at any time to sell, exchange or in
any other manner (other than in a manner permitted by Section 6.3(a) or
(b) hereof) dispose of any Common Interests in the Company held by such
Member, then such Member shall give written notice (a "Notice of Intention
to Sell") to the other Members (collectively, the "Other Investors")
setting forth in reasonable detail the terms and conditions of such
proposed transaction.
(b) Right of Other Investors Each of the Other Investors shall have
the right, exercisable upon written notice to the Selling Investor within
fifteen (15) days after receipt of any Notice of Intention to Sell, to
participate in the proposed disposition of Common Interests by the Selling
Investor to the proposed purchaser on the terms and conditions set forth in such
Notice of Intention to Sell. Each of the Other Investors may participate with
respect to all or any part of that number of Common Interests which is equal to
the product obtained by multiplying (i) the aggregate number of Common Interests
covered by the proposed disposition (treating, for purposes of such calculation,
any Common Interests issuable upon conversion of any convertible securities of
the Company or upon exercise of any options or rights covered by the proposed
disposition as representing the Common Interests issuable upon such conversion
or exercise) by (ii) a fraction, the numerator of which is the number of Common
Interests owned by such Other Investor (treating, for purposes of such
calculation, any Common Interests issuable upon conversion of any convertible
securities of the Company or upon exercise of any options or rights then held by
such Other Investor as being issued and outstanding and held by such Other
Investor as of such date) and the denominator of which is the sum of the total
number of Common Interests at the time owned by the Selling Investor and the
Other Investors combined (treating, for purposes of such calculation, any Common
Interests issuable upon conversion of any convertible securities of the Company
or upon exercise of any options or rights then held by the
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SOUTHWEST II
Selling Investor and the Other Investors as being issued and outstanding and
held by the Selling Investor and the Other Investors, as the case may be, as of
such date).
(c) Delivery of Interests. Each of the Other Investors participating
in the proposed disposition shall deliver to the Company, as agent for such
Other Investor, for transfer to the proposed acquiror, one or more certificates
(if such Interests are certificated), properly endorsed for transfer or
accompanied by transfer powers duly endorsed for transfer, with all transfer
taxes paid and stamps affixed, which represent the Common Interests that such
Other Investor elects to dispose of pursuant to this Section 6.1. The
consummation of such proposed disposition shall be subject to the sole
discretion of the Selling Investor, which shall have no liability whatsoever to
any Other Investor participating therein other than (i) to obtain for such Other
Investor the same terms and conditions as those obtained by the Selling Investor
as set forth in the Notice of Intention to Sell or any amendment thereof
communicated to the Other Investors in the manner provided for in Section
6.1(a)(ii) above; it being understood, however, that any consideration payable
or otherwise deliverable to the Common Members participating in such disposition
shall be shared among the Common Members in a manner consistent with the
respective Interests of the Class A Common Members and the Class B Common
Members in effect immediately prior to the consummation of such disposition,
including, without limitation, giving effect to the priorities set forth in
Section 4.5.
(d) Delivery of Proceeds. The Common Interests delivered by each of
the Other Investors to the Company pursuant to Section 6.1(c), or with respect
to which instructions shall have been so given, shall be transferred by the
Company to the purchaser, in consummation of the disposition to such purchaser,
pursuant to the terms and conditions specified in Section 6.1(a) above, and the
Company shall promptly thereafter remit to such Other Investor that portion of
the proceeds of disposition to which such Other Investor is entitled by reason
of such participation.
VI.2 Right of First Refusal.
(a) Notice of Transfer. Subject as set forth in Section 6.1(a)(i),
if any Additional Member (a "Selling Investor") proposes at any time, other than
pursuant to Section 6.3(a) hereof, to sell, exchange or in any other manner
dispose of any Common Interests or other equity interests in the Company held by
such Member pursuant to Section 6.3(b) hereof pursuant to a bona fide offer from
an unaffiliated third party, then such Member shall give written notice (a
"Notice of Intention to Sell") to the Initial Member, setting forth in
reasonable detail the terms and conditions of such proposed transaction, the
identity of the proposed purchaser and the proposed purchase price and terms of
sale (including a copy of any written offer or indication of interest).
(b) Right of Initial Member. The Initial Member shall have the
right, exercisable upon written notice to the Selling Investor within fifteen
(15) days after receipt of any
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SOUTHWEST II
Notice of Intention to Sell, to purchase all, but not less than all, of (i) the
Common Interests covered by the proposed disposition from the Selling Investor
on the terms and conditions set forth in such Notice of Intention to Sell.
(c) Delivery of Interests. In the event that the Initial Member
shall exercise such right in accordance with Section 6.2(b) above, the Selling
Investor shall deliver to the Company, as agent for such Selling Investor, for
transfer to the Initial Member, one or more certificates (if such Interests are
certificated), properly endorsed for transfer or accompanied by transfer powers
duly endorsed for transfer, with all transfer taxes paid and stamps affixed,
which represent the Common Interests that the Initial Member elects to purchase
pursuant to this Section 6.2.
(d) Delivery of Proceeds. The Common Interests delivered by the
Selling Investor to the Company pursuant to Section 6.2(d) shall be transferred
by the Company to the Initial Member, as the case may be, in consummation of the
disposition to such Member, pursuant to the terms and conditions specified in
Section 6.2(a) above, and the Company shall promptly thereafter remit to the
Selling Investor the proceeds of disposition to which such - Selling Investor is
entitled by reason of such disposition.
(e) Sale of Unpurchased Interests. During the 90 days following the
expiration of such 15 day offering period, the Selling Investor shall be
entitled to sell any Interests or other equity securities which the other
Members shall not have agreed to purchase as described in Section 6.2(b) and (c)
above on terms and conditions no more favorable to the purchasers thereof than
those offered to the Initial Member. Any Interests or other equity securities
offered or sold by any Additional Member pursuant to Section 6.3(b) after such
90 day period must be reoffered to the Initial Member pursuant to the terms of
this Section 6.2.
VI.3 Permitted Transfers.
(a) Anything herein to the contrary notwithstanding, Section 6.I and
Section 6.2 shall not apply to (i) any transfer by any Member to one or more
Affiliates of such Member or any investment limited partnership or limited
liability company under common management with any Member, (ii) any
distributions or transfers by any Member to any of its members or partners
(including any of its limited partners) or (iii) any transfer by a Member to
such Member's spouse or lineal descendants, or to a trust for the benefit of any
of the foregoing; provided, in each case, that any such transferee (each, a
"Permitted Transferee") shall agree in writing with the parties hereto to be
bound by, and to comply with, all applicable provisions of this Agreement.
(b) Anything herein to the contrary notwithstanding, Section 6.1
shall not apply (but Section 6.2 shall apply) to any transfer by any Additional
Member if unanticipated personal hardship affects such Additional Member (or, in
the case of an Additional Member that is not an individual, any of such
Additional Member's equityholders), and, if so requested, the
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SOUTHWEST II
nature of such hardship is described in reasonable detail (subject to
appropriate restrictions on disclosure) to the Managers of the Company.
VI.4 Preemptive Rights
(a) Offer to Sell. If the Managers approve the issuance or sale of
any Interests or equity securities of the Company in an Eligible Offering, then
the Company shall first offer to sell to each Member a portion of such Interests
or equity securities equal to all or any portion of such Member's Applicable
Percentage thereof.
(b) Right to Purchase. In order to accept an offer under Section
6.4(a), a Member must, within 15 days after receipt of written notice from the
Company describing in reasonable detail the Interests or other equity securities
being offered, the purchase price thereof, the payment terms and such Member's
Applicable Percentage, deliver a written notice to the Company accepting such
offer.
(c) Sale of Unsubscribed Interests. During the 90 days following the
expiration of such 15 day offering period, the Company shall be entitled to sell
any Interests or other equity securities which have not been subscribed for by
Members as described in Section 6.4(b) above on terms and conditions no more
favorable to the purchasers thereof than those offered to such Members. Any
Interests or other equity securities offered or sold by the Company in an
Eligible Offering after such 90 day period must be reoffered to the Members
pursuant to the terms of this Section 6.4.
(d) Post Closing Compliance. Notwithstanding the foregoing, if the
Managers determine in their reasonable discretion that it will not be possible
for the Company to comply with the foregoing provisions of this Section 6.4
within the required time limits, then the Company may fulfill its obligations
with respect to the Additional Members promptly after the closing of the
issuance or sale of the Initial Member's Applicable Percentage of such Interests
to the Initial Member but in all other respects on the terms and conditions of
this Section 6.4.
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VI.5 Sale of the Business; Drag-Along Rights; Etc.
(a) If any transaction or series of related transactions negotiated
with an unaffiliated bona fide third party on an arm's-length basis that would
result in (i) a sale of all or substantially all of the assets of the Company is
approved by the Managers or (ii) the sale by any Member or group of Members of
equity interests of the Company representing more than 50% of all outstanding
equity interests of the Company is approved by such Members or, if such approval
is required hereunder, by the Managers (each, an "Approved Transaction"), then
each Member covenants and agrees (i) to vote all of such Member's Interests and
other voting securities of the Company held by such Member in favor of such
Approved Transaction if such a vote shall be required and (ii) to sell all of
its Interests and other equity securities of the Company to the purchaser in
such Approved Transaction if such sale shall be required by the Managers or
otherwise by the sellers as part of such Approved Transaction; provided,
however, that any consideration payable or otherwise deliverable to the Members
in such Approved Transaction shall be shared among the Members in a manner
consistent with the respective Interests of the Members as in effect immediately
prior to the consummation of such Approved Transaction.
(b) In connection with any senior debt financing by the Company or
any of its Affiliates, each Member covenants and agrees to pledge all of its
Interests and other equity securities of the Company to the lenders
participating in such senior debt financing if such pledge shall be required by
the Managers or otherwise as part of such debt financing;
(c) In furtherance of the covenants of the Members in Section 6.5(a)
and Section 6.5(b), each Member hereby agrees to cooperate fully with the
Managers and the Company in any such Approved Transaction or debt financing and
to execute and deliver all documents (including purchase agreements) and
instruments as the Managers or the Company reasonably request to effect such
Approved Transaction or debt financing, including, without limitation, the
making of all commercially reasonable representations, warranties and
indemnifications (including participating in any escrow arrangements) and
similar arrangements relating to such Approved Transaction or debt financing,
except that no Member shall be required to guarantee the obligations of the
Company or any of its Affiliates in connection with any senior debt financing.
VI.6 Intentionally Omitted.
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ARTICLE VII
ADMISSION OF NEW MEMBERS
VII.l Admission of New Members.
(a) Admission of Members. The Managers may at any time cause the
Company to admit additional Members ("New Members"); provided, however, that,
subject as set forth in Section 7.2, each Permitted Transferee of a Member shall
automatically be admitted as a Member hereunder with respect to the Interests
transferred.
(b) Time of Admission. A New Member shall be deemed admitted as a
member upon the later of: (i) the later of (1) the written request by such
Person that the Members' Interest Register reflect such admission and (2) the
execution by such Person of this Agreement or a counterpart hereof whereby such
person agrees to be bound by the provisions of this Agreement, and (ii) the time
such Person is listed as a Member in the Members' Interest Register of the
Company.
(c) Required Contribution. The Managers shall determine the
contribution the New Member needs to make and the number and class of interests
to be issued to such Member. The Managers may provide that the required
contribution may be paid prior to, at the time of, or subsequent to, the
issuance of any interest to such Member and that any subsequent contribution may
be made from distributions paid or payable in respect of such interest. If any
portion of a required contribution is payable after the issuance of the
interest, the Managers may determine that any rights otherwise incident to such
interest (including, without limitation, voting, distribution, inspection and
transfer rights) will not come into effect until such required contribution has
been made. At any time that the voting rights in respect of such interest have
been suspended, in determining whether a required percentage of Interests have
approved any action, such Interests shall be excluded from both the numerator
and the denominator of such percentage computation.
VII.2 Transferees and Assignees.
(a) Except as expressly provided herein, any transferee or assignee
of any Interest in the Company shall be subject to all of the restrictions on
transfer of an interest in the Company imposed upon a Member, even if such
transferee or assignee is not admitted to the Company as a Member. Any
transferee or assignee of an interest in the Company who is not admitted to the
Company as a Member shall nevertheless be entitled to the share of Company
distributions attributable to the interest acquired by such transferee or
assignee.
(b) As a condition to any person's admission to the Company as a new
or substitute Member, such person shall be required to execute an amendment to
this Agreement, in
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such form as may be required by the Managers, under which such person agrees to
be bound by all of the terms, provisions and obligations of this Agreement.
ARTICLE VIII
CERTAIN AGREEMENTS
VIII.l Mergers, Etc. The Company may merge or consolidate with one
or more limited liability companies, corporations, business trusts or
associations, real estate investment trusts, common law trusts or unincorporated
businesses, including a general partnership or limited partnership, formed under
the laws of the State of Delaware or any other jurisdiction, pursuant to a
written agreement of merger or consolidation ("Merger Agreement") in accordance
with this Section 8.1.
(a) Procedure for Merger or Consolidation. Merger or consolidation
of the Company pursuant to this Section 8.1 requires the prior approval of the
Managers. If the Managers shall determine, in the exercise of their sole
discretion, to consent to the merger or consolidation, the Managers shall
approve the Merger Agreement, which shall set forth:
(i) the names and jurisdictions of formation or organization of each
of the business entities proposing to merge or consolidate;
(ii) the name and jurisdiction of formation or organization of the
business entity that is to survive the proposed merger or consolidation
(the "Surviving Business Entity");
(iii) the terms and conditions of the proposed merger or
consolidation;
(iv) the manner and basis of exchanging or converting the equity
securities of each constituent business entity for, or into, cash,
property or limited partnership or limited liability company interests,
rights, securities or obligations of the Surviving Business Entity;
provided that holders of Interests shall not receive general partnership
interests in any such merger of consolidation; and (i) if any general or
limited partnership or limited liability company interests, rights,
securities or obligations of any constituent business entity are not to be
exchanged or converted solely for, or into, cash, property or limited
partnership or limited liability company interests, rights, securities or
obligations of the Surviving Business Entity, the cash, property or
limited partnership or limited liability company interests, rights,
securities or obligations of any limited partnership, limited liability
company, corporation, trust or other entity (other than the Surviving
Business Entity) which the holders of such interests, rights, securities
or obligations of the constituent business entity are to receive in
exchange for, or upon conversion of, their
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interests, rights, securities or obligations and (ii) in the case of
securities represented by certificates, upon the surrender of such
certificates, which cash, property or general or limited partnership or
limited liability company interests, rights, securities or obligations of
the Surviving Business Entity or any general or limited partnership,
limited liability company, corporation, trust or other entity (other than
the Surviving Business Entity), or evidences thereof, are to be delivered;
and
(v) such other provisions with respect to the proposed merger or
consolidation as are deemed necessary or appropriate by the Managers.
(b) Approval by Class B Common Members of Merger or Consolidation.
(i) General. The Managers, upon their approval of the Merger
Agreement as aforesaid, shall direct that the Merger Agreement be
submitted to a vote of the Class B Common Members whether at a meeting or
by written consent, in either case in accordance with the requirements of
Section 2.3. A copy or a summary of the Merger Agreement shall be included
in or enclosed with the notice of a meeting or the written consent.
(ii) Required Vote. The Merger Agreement shall be approved upon
receiving the Majority Vote of the Class B Common Members unless the
Merger Agreement contains any provision which, if contained in an
amendment to this Agreement, the provisions of this Agreement or the
Delaware Act would require the vote or consent of a greater percentage of
the Interests or of any other Class of Interests, in which case such
greater percentage vote or consent shall be required for approval of the
Merger Agreement.
(iii) Abandonment of Merger or Consolidation. After such approval by
Majority Vote of the Class B Common Members, and at any time prior to the
filing of the certificate of merger or consolidation pursuant to Section
8.1(c), the merger or consolidation may be abandoned pursuant to
provisions therefor, if any, set forth in the Merger Agreement. The Merger
Agreement shall also require the approval of any other Class of Members if
such approval is specifically required by this Agreement.
(c) Certificate of Merger or Consolidation. Upon the required
approval by the Managers and the Common Members of a Merger Agreement, a
certificate of merger or consolidation shall be executed and filed with the
Secretary of State of the State of Delaware in conformity with the requirements
of the Delaware Act.
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SOUTHWEST II
(d) Effect of Merger or Consolidation.
(i) Effect of Merger. At the effective time of the certificate of
merger or consolidation:
(A) all of the rights, privileges and powers of each of the business
entities that has merged or consolidated, and all property, real, personal
and mixed, and all debts due to any of those business entities and all
other things and causes of action belonging to each of those business
entities shall be vested in the Surviving Business Entity and after the
merger or consolidation shall be the property of the Surviving Business
Entity to the extent they were property of each constituent business
entity;
(B) the title to any real property vested by deed or otherwise in
any of those constituent business entities shall not revert and is not in
any way impaired because of the merger or consolidation;
(C) all rights of creditors and all liens on or security interest in
property of any of those constituent business entities shall be preserved
unimpaired; and
(D) all debts, liabilities and duties of those constituent business
entities shall attach to the Surviving Business Entity, and may be
enforced against it to the same extent as if the debts, liabilities and
duties had been incurred or contracted by it.
(ii) No Transfer of Assets or Liabilities. A merger or consolidation
effected pursuant to this Section 8.1 shall not be deemed to result in a
transfer or assignment of assets or liabilities from one entity to another
having occurred.
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VIII.2 Public Offering. In the event that the Managers approve an
initial public offering and sale of equity securities of the Company pursuant to
an effective registration statement under the Securities Act (a "Public
Offering") or the Company is required to undertake a Public Offering pursuant to
the Registration Rights Agreement, the Members shall take all necessary or
desirable actions required or deemed advisable by the Managers in connection
with the consummation of such Public Offering. In the event that (i) such Public
Offering is an underwritten offering and the managing underwriters advise the
Company in writing that in their opinion the existing capital structure of the
Company adversely affects the marketability of the offering or (ii) the Class B
Common Members so elect by Majority Vote, each Member shall consent to and vote
for a recapitalization, reorganization and/or exchange of such Member's
Interests into securities that the managing underwriter and/or such Class B
Common Members by Majority Vote find acceptable and shall take all necessary or
desirable actions in connection with the consummation of such recapitalization,
reorganization and/or exchange; provided, however, that the resulting
securities, to the extent possible, reflect and are consistent with the Members'
respective Interests as in effect immediately prior to such Public Offering
(except that such recapitalization, reorganization and/or exchange shall
include, without limitation, to convert the Class A Non-Voting Common Interests
into Voting Common Interests on a one-for-one basis); and provided further,
however, that the Members are in substantially the same economic position with
respect to such resulting securities as they were prior to such
recapitalization, reorganization and/or exchange.
VIII.3 Plan Asset Regulations. Each direct and indirect subsidiary
acquired or formed by the Company shall qualify as a majority owned subsidiary
for purposes of the Plan Asset Regulations.
ARTICLE IX
CERTAIN DEFINITIONS
For the purposes of this Agreement, the following terms shall have
the meanings specified in this Article. Additional terms are defined in the text
of this Agreement.
"Act" means the Delaware Limited Liability Company Act, 6 Del. C.
Section 18-101 et seq., as amended from time to time.
"Additional Members" has the meaning set forth in the recitals to
this Agreement.
"Affiliate", as applied to any Person, means any other Person
directly or indirectly controlling, controlled by, or under common control with,
such Person. For purposes of this definition, "control" (including, with
correlative meaning, the terms "controlling", "controlled by" and "under common
control with"), as applied to any Person means the possession, directly
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SOUTHWEST II
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities,
by contract or otherwise.
"Applicable Percentage" means, with respect to each Common Member as
of any date, the result (expressed as a percentage) obtained by dividing (x) the
aggregate number of Common Interests held by such Common Member on such date
(treating the Common Interests issuable upon conversion of any convertible
securities of the Company or upon exercise of any options or rights then held by
such Member as being issued and outstanding and held by such Member as of such
date) by (y) the total number of Common Interests issued and outstanding as of
such date (treating the Common Interests issuable upon conversion of all
outstanding securities or upon exercise of all outstanding options or rights as
aforesaid as being issued and outstanding as of such date).
"Approved Transaction" has the meaning set forth in Section 6.5(a).
"Book Value" has the meaning set forth in Section 3.4.
"Capital Commitment" means with respect to any Member, the amount
set forth opposite such Member's name on Schedule HI hereto in the column
labeled "Capital Commitment".
"Capital Contribution" means a contribution in cash by a Member to
the capital of the Company pursuant to this Agreement.
"Certificate of Formation" has the meaning set forth in Section
1.1(a).
"Class" means, with respect to any Interests or other equity
interests in the Company, the Class A Non-Voting Common Interests, the Class B
Common Interests, the Preferred Interests, the Common Interests, and each other
class of equity interests in the Company that may be issued from time to time in
accordance with this Agreement, and with respect to any Members, the Class A
Common Members, the Class B Common Members, the Common Members and the Preferred
Members.
"Class A Common Capital Amount" has the meaning set forth in Section
4.3(b).
"Class A Non-Voting Common Interest" means an interest in the
Company that represents a "Class A Common" limited liability company interest
having the designations, powers, preferences and rights, and the qualifications,
limitations and restrictions thereof, specified in Article IV.
"Class A Common Member" has the meaning set forth in Section
2.3(b)(ii).
"Class B Common Capital Amount" has the meaning set forth in Section
4.4(b).
36
SOUTHWEST II
"Class B Common Interest" means an interest in the Company that
represents a "Class B Common" limited liability company interest having the
designations, powers, preferences and rights, and the qualifications,
limitations and restrictions thereof, specified in Article IV.
"Class B Common Member" has the meaning set forth in Section
2.3(b)(ii).
"Closing Date" has the meaning set forth in Section 3.3(c).
"Code" means the Internal Revenue Code of 1986, as amended. Any
reference to a Section of the Code shall include a reference to any amendatory
or successor provision thereto.
"Common Interests" means, collectively, the Class A Non-Voting
Common Interests and the Class B Common Interests.
"Common Members" means the Class A Common Members and the Class B
Common Members.
"Eligible Offering" means an offer by the Company to sell for cash
to one or more investors Interests or other equity securities of the Company or
any security or instrument convertible into or exchangeable for, or carrying
rights or options to purchase, Interests or other equity securities of the
Company, other than:
(i) an offering of securities by the Company to its employees,
consultants, officers and/or managers in connection with or pursuant to
any employee benefit or compensation plan or arrangement approved by the
Managers, whether currently in existence or created hereafter;
(ii) the offering and sale of Interests pursuant to the Subscription
Agreement, or in connection with any debt financing;
(iii) the issuance of Interests or other equity securities of the
Company pursuant to the exercise or conversion of any options, warrants or
convertible securities issued in compliance with the preemptive rights set
forth in Section 6.4 (except to the extent that such options, warrants or
convertible securities were themselves originally issued in an offering
not excluded from the definition of Eligible Offering under clauses (i),
(ii), (iv) or (v) of this definition.
(iv) in connection with any merger of, or acquisition by, the
Company, any corporate partnering, strategic alliance, technology
transfer, equipment financing or
37
SOUTHWEST II
similar transaction by the Company or other transaction by the Company
approved by the Managers for a consideration other than cash; or
(v) in an offering registered under the Securities Act.
"Financing Agreement" means any or all of the agreements pursuant to
which the Initial Member, the Company or their direct and indirect subsidiaries
arrange for, secure or obtain loans and a credit facility from CoBank, Bank of
America or the other members of the bank group (as such agreements may be
amended, restated, supplemented, replaced or otherwise modified from time to
time, including, without limitation, any agreement extending the maturity or
term of, or refinancing or refunding, all or any portion of the indebtedness or
obligations under, or increasing the amount to be borrowed or guaranteed under,
any such agreements or successor agreements, whether or not by or among the same
parties).
"Fiscal Year" has the meaning set forth in Section 1.5.
"Initial Investment" has the meaning set forth in the recitals to
this Agreement.
"Initial Member" has the meaning set forth in the recitals to this
Agreement.
"Initial Member LLC Agreement" means the Second Amended and Restated
Limited Liability Agreement of the Initial Member, dated as of January 31, 2002,
among the members of the Initial Member named therein.
"Interests" has the meaning set forth in Section 4.1(a).
"IRS" means the Internal Revenue Service.
"Kerrville" has the meaning set forth in Section 1.6.
"Kerrville Stock Purchase Agreement" has the meaning set forth in
Section 1.6.
38
SOUTHWEST II
"Liquidation Event" means the occurrence of (i) the liquidation,
dissolution or winding up, whether voluntary or involuntary, of the Company,
(ii) the consolidation or merger of the Company with or into any other entity
(other than a merger which will not result in more than 50% of the voting
Interests and economic interests of the Company outstanding immediately after
the effective date of such merger being owned of record or beneficially by
persons other than the holders of such voting Interests and economic interests
immediately prior to such merger in the same proportions in which such Interests
were held immediately prior to such merger), (iii) the sale of all or
substantially all of the properties and assets of the Company as an entirety to
any other person, or (iv) the acquisition of "beneficial ownership" by any
"person" or "group" of voting Interests of the Company representing more than
50% of the voting power of all out-standing voting Interests, whether by way of
merger or consolidation or otherwise, other than any such acquisition by the
Initial Member, WCAS VIII or WCAS IX. As used in the preceding sentence, (x) the
terms "person" and "group" shall have the meaning set forth in Section 13(d)(3)
of the Exchange Act, whether or not applicable, (y) the term "beneficial owner"
shall have the meaning set forth in Rules 13d-3 and 13d-5 under the Exchange
Act, whether or not applicable, except that a person shall be deemed to have
"beneficial ownership" of all voting Interests that any such person has the
right to acquire, whether such right is exercisable immediately or only after
the passage of time or upon the occurrence of certain events, and (z) any
"person" or "group" will be deemed to beneficially own any voting Interests of
the Company so long as such person or group beneficially owns, directly or
indirectly, in the aggregate a majority of the voting stock of a registered
holder of the voting Interests of the Company.
"Majority Vote" means (i) with respect to any vote or written
consent of the Members, the affirmative vote or written consent of Members
holding Interests representing a majority of the outstanding Interests, and (ii)
with respect to any vote or written consent of any Class of Members, the
affirmative vote or written consent of Members holding any Class of Interests
representing a majority of the outstanding Interests of such Class.
"Managers" has the meaning set forth in Section 2.1 and "Manager"
shall mean at any time and from time to time, each Person that shall be one of
the Managers in office at such time in accordance with this Agreement.
"Members" has the meaning set forth in the recitals to this
Agreement.
"Members' Interest Register" has the meaning set forth in Section
2.12(a).
"Notice of Intention to Sell" has the meanings set forth in Section
6.1(a) and 6.2(a), as applicable.
"Permitted Transferee" has the meaning set forth in Section 6.3.
39
SOUTHWEST II
"Person" shall mean a natural person, partnership (whether general
or limited), limited liability company, trust, estate, association, corporation,
custodian, nominee or any other individual or entity in its own or any
representative capacity.
"Plan Asset Regulations" shall mean the Department of Labor
Regulation Section 25I0.3-101(d).
"Preferred Appreciation Amount" has the meaning set forth in Section
4.2(b)(ii).
"Preferred Capital Amount" has the meaning set forth in Section
4.2(b)(i).
"Preferred Interest" means an interest in the Company that
represents a "Preferred" limited liability company interest having the
designations, powers, preferences and rights, and the qualifications,
limitations and restrictions thereof, specified in Article IV.
"Preferred Liquidation Amount" has the meaning set forth in Section
4.2(b).
"Preferred Member" has the meaning set forth in Section 2.3 (b)(ii).
"Redemption Event" means the consummation of an underwritten public
offering of Interests (or other equity securities of the Company or any
successor corporation thereto) registered under the Securities Act of 1933, as
amended.
"Selling Investor" has the meanings set forth in Sections 6.1(a) and
6.2(a), as applicable.
"Securities Act" means the Securities Act of 1933, as amended.
"Southwest II Subscription Agreement" has the meaning set forth in
the recitals to this Agreement.
"Transfer" means to sell, transfer, assign, pledge or otherwise
encumber or dispose of (whether with or without consideration and whether
voluntarily or involuntarily or by operation of law), directly or indirectly;
provided, that a lien arising with respect to Interests in connection with a
general lien on all or substantially all of the assets of the holder of
Interests shall not constitute a Transfer.
"WCAS VIII" means ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ VIII, L.P., a
Delaware limited partnership.
40
SOUTHWEST II
"WCAS IX" means ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ IX, L.P., a Delaware
limited partnership.
ARTICLE X
MISCELLANEOUS PROVISIONS
X.1 Entire Agreement. This Agreement, including the Exhibits and
other documents and schedules attached hereto or incorporated herein by
reference and the Subscription Agreement, constitute the entire agreement of the
Members with respect to the matters covered herein. This Agreement supersedes
all prior agreements and oral understandings among the Members with respect to
such matters including, without limitation, the Original Agreement.
X.2 Amendment. This Agreement may not be modified or amended, and no
provision hereof may be waived, except by Majority Vote of the Class B Common
Members; provided, however, that this Agreement may not be modified or amended,
and no provision hereof may be waived, in any manner which (w) treats any holder
of any Interest differently from. any other holder of the same series, class or
type of Interest without the consent of the holder differently treated, (x)
adversely affects the rights of the holders of the Class A Non-Voting Common
Interests to share ratably with the holders of the Class B Common Interests in
the net assets of the Company as provided in Section 4.5, or (z) modifies,
amends or waives any provision of this Section I0.2 or increases the Capital
Commitment of any Member, without the consent of each Member affected thereby.
Notwithstanding anything to the contrary in this Agreement (x) Schedule III
attached hereto may be amended from time to time by the Managers to the extent
required to reflect accurately the then current status of the information
contained thereon and (y) the Certificate of Formation and this Agreement may be
amended from time to time by the Mangers to change any of the information
therein or herein, including the name of the Company, required by the Delaware
Act to be set forth in a certificate of formation of a limited liability company
formed thereunder.
X.3 Duration of Certain Agreements. The agreements of the Members
set forth in Article VI of this Agreement shall terminate upon the earliest to
occur of (i) a Liquidation Event, (ii) the closing of a firm commitment
underwritten public offering by which equity securities of the Company are sold
to the public in a public offering registered under the Securities Act of 1933
and lead managed by a nationally recognized investment banking firm, resulting
in proceeds to the Company (after deducting underwriting discounts and
commissions) of not less than $75,000,000 and (iii) with respect to any Member,
the date on which such Member no longer owns any Common Interests.
41
SOUTHWEST II
X.4 Interpretation. Whenever the context may require, any noun or
pronoun used herein shall include the corresponding masculine, feminine or
neuter forms. The singular form of nouns, pronouns and verbs shall include the
plural and vice versa.
X.5 Severability. Each provision of this Agreement shall be
considered severable and if for any reason any provision or provisions hereof
are determined to be invalid and contrary to existing or future law, such
invalidity shall not impair the operation or affect those portions of this
Agreement which are valid, and this Agreement shall remain in full force and
effect and shall be construed and enforced in all respects as if such invalid or
unenforceable provision or provisions had been omitted.
X.6 Burden and Benefit Upon Successors. Except as expressly
otherwise provided herein, this Agreement is binding upon, and inures to the
benefit of, the parties hereto and their respective heirs, executors,
administrators, personal and legal representatives, successors and permitted
assigns.
X.7 Further Assurances. Each Member hereby agrees that such Member
shall hereafter execute and deliver such further instruments, provide all
information and take or forbear such further acts and things as may be
reasonably required or useful to carry out the intent and purpose of this
Agreement and as are not inconsistent with the terms hereof.
42
SOUTHWEST II
X.8 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which together will
constitute one instrument, binding upon all parties hereto, notwithstanding that
all of such parties may not have executed the same counterpart. This Agreement
shall become effective as to the Initial Member upon execution and delivery
hereof. This Agreement shall become effective as to each Additional Member when
such Member shall have received a counterpart hereof signed by each other party
hereto. No provision of this Agreement shall confer upon any person other than
the parties hereto any rights or remedies hereunder. The effectiveness of this
Agreement as among the Initial Member and the other persons who elect to become
Members hereunder as contemplated hereby and by the Southwest II Subscription
Agreement shall not be affected by the failure of any person whose name appears
on the signature pages hereto under the heading "Additional Members" to execute
and deliver this Agreement to the other parties hereto.
X.9 Waiver. Any forbearance or failure or delay by any officer,
Manager or Member to exercise any rights, powers or remedies hereunder shall not
be deemed to be a waiver of such rights, powers or remedies and any single or
partial exercise of any right, power or remedy hereunder shall not preclude the
further exercise hereof; and every right, power or remedy of any officer,
Manager or Member shall continue in full force and effect until such right,
power or remedy is specifically waived by an instrument in writing executed by
such officer, Manager or Member.
43
SOUTHWEST II
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first written above.
VALOR TELECOMMUNICATIONS, LLC
By /s/ ▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Executive Vice President &
Chief Financial Officer
TA TELECOM, LLC
By /s/ ▇▇▇▇▇ ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Managing Member
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
_________________________________
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇.
WEG TELECOM, LLC
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Member
SOUTHWEST II
▇▇▇▇▇ INVESTMENT CO., LLC
By ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title:
▇▇▇▇▇ FAMILY LP
By ▇▇▇▇▇▇ ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇
Title:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ ▇. ▇▇▇ ▇▇▇▇▇▇▇
---------------------------------
▇. ▇▇▇ ▇▇▇▇▇▇▇
CLARION COMMUNICATIONS, INC.
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title:
HMR INVESTMENTS, L.L.C.
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Member
SOUTHWEST II
REVOCABLE TRUSTS
By /s/ ▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇ ▇. ▇▇▇▇▇▇ TTEE
By /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇ TTEE
/s/ ▇. ▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------------
▇. ▇▇▇ ▇▇▇▇▇▇▇▇
SOUTHWEST II
SCHEDULE I
DESCRIPTION OF INITIAL CONTRIBUTION
Initial Member Initial Contribution
-------------- --------------------
Valor Telecommunications, LLC $100
47
SOUTHWEST II
SCHEDULE II
MEMBERS
Part 1
Initial Member
Valor Telecommunications, LLC
Las Colinas Tower 1
▇▇▇ ▇. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇.
Suite 200
Irving, TX 75062
Part 2
Additional Members (To be Updated on February 28, 2002)
TA Telecom, LLC
▇▇▇▇▇ ▇▇▇▇▇, Managing Member
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇- ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
The ▇▇▇▇▇▇▇ Companies
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
WEG Telecom, LLC
Intel Corporation
MS: F9-▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Managing Member
▇▇▇▇▇ Investment Co., LLC
c/o ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇ Agencies
▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇., N.E.
Albuquerque, NM 87190-3727
48
SOUTHWEST II
▇▇▇▇▇ Family LP
c/o ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇ Agencies
▇▇▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇., ▇.▇.
Albuquerque, NM 87190-3727
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
PlastiCom Industries, Inc.
▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇. ▇▇▇ ▇▇▇▇▇▇▇
Sunny Side, Inc./Tempside
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Clarion Communications, Inc.
c/o ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
40 N. IH35, TH6
Austin, TX 78701
HMR Investments, L.L.C.
c/o ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Managing Member
Shook, Hardy & Bacon LLP
▇▇▇▇▇▇▇▇ Square
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
Suite 800
Washington, DC 20005-2004
▇▇ ▇. ▇▇▇▇▇▇ TTEE
▇▇▇▇▇ ▇▇▇▇▇▇ TTEE
Revocable Trusts
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇.▇.
Albuquerque, NM 87122
▇. ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
49
SOUTHWEST H
SCHEDULE III
Document #546229 (Excel Worksheet)
SCHEDULE IV
Kerrville Stock Purchase Agreement
STOCK PURCHASE AGREEMENT DATED AS OF SEPTEMBER 7,2001 BY AND AMONG BA CAPITAL
COMPANY, L.P., KERRVILLE, PURCHASER, AND EACH OF THE PERSONS LISTED AS
STOCKHOLDERS OF KERRVILLE ON SCHEDULE 5.2 OF THE KERRVILLE STOCK PURCHASE
AGREEMENT.
50
SOUTHWEST II
ANNEX A
BOARD OF MANAGERS
Managers
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, Carson, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇, Carson, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Vestar Capital Partners
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇
Valor Telecommunications LLC
Las Colinas Tower ▇
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
51
SOUTHWEST II
ANNEX B
INITIAL OFFICERS
Office Name
------ ----
Chief Executive Officer ▇▇▇▇▇▇▇ ▇▇▇▇
President ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Secretary ▇▇▇▇▇▇▇ ▇▇▇▇▇
Treasurer. ▇▇▇▇ ▇▇▇▇▇▇
52