EXHIBIT 10.14
Form of ZL Hotel LLC Limited
Liability Company Agreement
ZL HOTEL LLC
LIMITED LIABILITY COMPANY AGREEMENT
TABLE OF CONTENTS
Page
ARTICLE I - Organization and Powers....................................... 1
1.01 Organization............................................ 1
1.02 Purposes and Powers..................................... 1
1.03 Principal Place of Business............................. 2
1.04 Fiscal Year............................................. 2
1.05 Qualification in Other Jurisdictions.................... 2
ARTICLE II - Members...................................................... 3
2.01 Members................................................. 3
2.02 Compliance with Securities Laws and Other Laws and
Obligations............................................. 3
2.03 Admission of New Members................................ 3
2.04 Meetings of Members..................................... 4
2.05 Action Without a Meeting................................ 4
2.06 Voting Rights........................................... 4
2.07 Limitation of Liability of Members...................... 5
2.08 Authority............................................... 5
2.09 No Right to Withdraw.................................... 5
2.10 Rights to Information................................... 5
2.11 No Appraisal Rights..................................... 5
ARTICLE III - Management.................................................. 6
3.01 Managers................................................ 6
3.02 Manager Responsibility.................................. 6
3.03 Powers and Duties of the Managers....................... 6
3.04 Reliance by Third Parties............................... 7
3.05 Resignation and Removal................................. 7
3.06 Compensation............................................ 7
3.07 Meetings and Action of Managers......................... 7
3.08 Limitation of Liability of Manager;
Certain Related Party Transactions...................... 8
3.09 Change of Control by Members that are Corporations...... 8
(ii)
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ARTICLE IV - Indemnification.................................................. 8
4.01 Right to Indemnification..................................... 8
4.02 Award of Indemnification..................................... 9
4.03 Successful Defense........................................... 9
4.04 Advance Payments............................................. 9
4.05 Definitions.................................................. 9
4.06 Insurance.................................................... 10
4.07 Employee Benefit Plan........................................ 10
4.08 Heirs, Spouses, Children and Personal Representatives........ 10
4.09 Non-Exclusivity.............................................. 10
4.10 Amendment.................................................... 10
ARTICLE V - Conflicts of Interest............................................. 11
5.01 Transactions with Interested Persons......................... 11
5.02 Outside Businesses........................................... 11
ARTICLE VI - Capital Accounts and Contributions............................... 11
6.01 Capital Accounts............................................. 11
6.02 Contributions................................................ 12
6.03 Failure to Contribute........................................ 12
ARTICLE VII - Distributions and Allocations................................... 13
7.01 Distribution of LLC Funds.................................... 13
7.02 Distribution Upon Dissolution................................ 13
7.03 Distribution of Assets in Kind............................... 14
7.04 Allocation of Profits and Losses............................. 14
ARTICLE VIII - Transfers of Interests......................................... 15
8.01 General Restrictions on Transfer............................. 15
8.02 Requirements for Transfer.................................... 15
8.03 Effect of Transfer........................................... 15
8.04 Prohibited Transfers......................................... 16
8.05 Right of First Refusal....................................... 16
8.06 Transfers of Interests by Manager-Member..................... 17
(iii)
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ARTICLE IX - Dissolution, Liquidation, and Termination..................... 17
9.01 Dissolution............................................ 17
9.02 Liquidation............................................ 17
9.03 Certificate of Cancellation............................ 17
ARTICLE X - General Provisions............................................ 18
10.01 Offset................................................. 18
10.02 Notices................................................ 18
10.03 Entire Agreement....................................... 18
10.04 Limitation of Litigation; Consent to Jurisdiction...... 18
10.05 Amendment or Modification.............................. 19
10.06 Binding Effect......................................... 19
10.07 Governing Law; Severability............................ 19
10.08 Further Assurances..................................... 19
10.09 Waiver of Certain Rights............................... 19
10.10 Notice to Members of Provisions of this Agreement...... 19
10.11 Third Party Beneficiaries.............................. 20
10.12 Interpretation......................................... 20
10.13 Counterparts........................................... 20
(iv)
ZL HOTEL LLC
LIMITED LIABILITY COMPANY AGREEMENT
This Agreement is made as of _______, 1997 by and between ZL Hotel LLC (the
"LLC") and the persons identified as the Managers and Members on SCHEDULE A
attached hereto (such persons and their respective successors in office or in
interests being hereinafter referred to individually as "MANAGER" or "MEMBER" or
collectively as "MANAGERS" or "MEMBERS").
WHEREAS, the LLC has been formed as a limited liability company under the
Delaware Limited Liability Company Act (as amended from time to time, the "ACT")
on ______, 1997; and
WHEREAS, the Managers and the Members wish to set out fully their
respective rights, obligations and duties regarding the LLC and its assets and
liabilities; and
WHEREAS, the LLC has entered into (or promptly after the date hereof in
accordance with predetermined terms will enter into) (i) a lease agreement with
Boston Properties Limited Partnership pursuant to which the LLC will lease two
hotel properties and (ii) a management agreement with Marriott Hotels, Inc.
pursuant to which Marriott Hotels, Inc. will manage such properties.
NOW, THEREFORE, in consideration of the mutual covenants expressed herein,
the parties hereby agree as follows:
ARTICLE I - ORGANIZATION AND POWERS
1.01 ORGANIZATION. The LLC has been formed by the filing of its
Certificate of Formation with the Delaware Secretary of State pursuant to the
Act. The original Certificate of Formation states that the registered agent and
registered office of the LLC in Delaware shall initially be The Corporation
Trust Company, Corporation Trust Center, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇. The Certificate of Formation may be restated by the
Managers as provided in the Act or amended by the Managers with respect to the
address of the registered office of the LLC in Delaware and the name and address
of its registered agent in Delaware or to make corrections required by the Act.
Other additions to or amendments of the Certificate of Formation shall be
authorized by the Members as provided in Section 2.06. The Certificate of
Formation as so amended from time to time is referred to herein as the
"CERTIFICATE." The Managers shall deliver a copy of the Certificate and any
amendment thereto to any Member who so requests.
1.02 PURPOSES AND POWERS. The principal business activity and purposes of
the LLC shall initially be to own or lease hotel properties and to manage or
contract for the management of the same, and any business related thereto or
useful in connection therewith. However, the business and purposes of the LLC
shall not be limited to its initial principal business activity and, unless the
Managers otherwise determine, it shall have authority to engage in any other
lawful business, purpose or activity permitted by the Act, and it shall possess
and may exercise all of the powers and privileges granted by the Act or which
may be
exercised by any person, together with any powers incidental thereto, so far as
such powers or privileges are necessary or convenient to the conduct, promotion
or attainment of the business purposes or activities of the LLC, including
without limitation the following powers:
(a) to conduct its business and operations in any state, territory or
possession of the United States or in any foreign country or jurisdiction;
(b) to purchase, receive, take, lease or otherwise acquire, own, hold,
improve, maintain, use or otherwise deal in and with, sell, convey, lease,
exchange, transfer or otherwise dispose of, mortgage, pledge, encumber or create
a security interest in all or any of its real or personal property, or any
interest therein, wherever situated.
(c) to borrow or lend money or obtain or extend credit and other
financial accommodations, to invest and reinvest its funds in any type of
security or obligation of or interest in any public, private or governmental
entity, and to give and receive interests in real and personal property as
security for the payment of funds so borrowed, loaned or invested;
(d) to make contracts, including contracts of insurance, incur
liabilities and give guaranties, whether or not such guaranties are in
furtherance of the business and purposes of the LLC, including without
limitation, guaranties of obligations of other persons who are interested in the
LLC or in whom the LLC has an interest;
(e) to appoint one or more managers of the LLC, to employ officers,
employees, agents and other persons, to fix the compensation and define the
duties and obligations of such personnel, to establish and carry out retirement,
incentive and benefit plans for such personnel, and to indemnify such personnel
to the extent permitted by this Agreement and the Act;
(f) to make donations irrespective of benefit to the LLC for the
public welfare or for community, charitable, religious, educational, scientific,
civic or similar purposes; and
(g) to institute, prosecute, and defend any legal action or
arbitration proceeding involving the LLC, and to pay, adjust, compromise,
settle, or refer to arbitration any claim by or against the LLC or any of its
assets.
1.03 PRINCIPAL PLACE OF BUSINESS. The principal office and place of
business of the LLC shall initially be ▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇. The Managers may change the principal office or place of business of the
LLC at any time and may cause the LLC to establish other offices or places of
business. The Managers shall notify the Members of any such change.
1.04 FISCAL YEAR. The fiscal year of the LLC shall end on December 31 of
each year.
1.05 QUALIFICATION IN OTHER JURISDICTIONS. The Managers shall cause the
LLC to be qualified or registered under applicable laws of any jurisdiction in
which the LLC transacts business and shall be authorized to execute, deliver and
file any certificates and
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documents necessary to effect such qualification or registration, including
without limitation, the appointment of agents for service of process in such
jurisdictions.
ARTICLE II - MEMBERS
2.01 MEMBERS. The initial Members of the LLC (which include the initial
Managers of the LLC) and their addresses shall be listed on SCHEDULE A and said
schedule shall be amended from time to time by the Managers to reflect the
withdrawal of Members or the admission of additional Members pursuant to this
Agreement. The Members shall constitute a single class or group of members of
the LLC for all purposes of the Act, unless otherwise explicitly provided
herein. The Managers shall notify the Members of changes in SCHEDULE A, which
shall constitute the record list of the Members for all purposes of this
Agreement.
2.02 COMPLIANCE WITH SECURITIES LAWS AND OTHER LAWS AND OBLIGATIONS. Each
Member hereby represents and warrants to the LLC and acknowledges that (a) it
has such knowledge and experience in financial and business matters that it is
capable of evaluating the merits and risks of an investment in the LLC and
making an informed investment decision with respect thereto, (b) it is able to
bear the economic and financial risk of an investment in the LLC for an
indefinite period of time and understands that it has no right to withdraw and
have its interest repurchased by the LLC, (c) it is acquiring an interest in the
LLC for investment only and not with a view to, or for resale in connection
with, any distribution to the public or public offering thereof, (d) it
understands that the equity interests in the LLC have not been registered under
the securities laws of any jurisdiction and cannot be disposed of unless they
are subsequently registered and/or qualified under applicable securities laws
and the provisions of this Agreement have been complied with and (e) if it is an
entity, the execution, delivery and performance of this Agreement do not require
it to obtain any consent or approval that has not been obtained and do not
contravene or result in a default under any provision of any existing law or
regulation applicable to it, any provision of its charter, by-laws or other
governing documents (if applicable) or any agreement or instrument to which it
is a party or by which it is bound.
2.03 ADMISSION OF NEW MEMBERS. Additional persons may be admitted to the
LLC as Members and may participate in the profits, losses, distributions,
allocations and capital contributions of the LLC upon such terms as are
established by the Managers, which may include the establishment of classes or
groups of one or more Members having different relative rights, powers and
duties, including without limitation, rights and powers that are superior to
those of existing Members, or the right to vote as a separate class or group on
specified matters, by amendment of this Agreement under Section 10.05. New
Members shall be admitted at the time when all conditions to their admission
have been satisfied, as determined by the Managers, and their identity,
Membership Interests (as defined in Section 2.06) and Contributions (if any)
under Section 6.02 have been established by amendment of SCHEDULE A. Existing
Members shall have no preemptive or similar right to subscribe to the purchase
of new Membership Interests in the LLC.
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2.04 MEETINGS OF MEMBERS.
(a) Meetings of Members may be called for any proper purpose at any
time by the Managers. The Managers calling the meeting shall determine the
date, time and place of each meeting of Members, and written notice thereof
shall be given by the Managers to each Member not less than three (3) business
days or more than sixty (60) calendar days prior to the date of the meeting.
Notice shall be sent to Members of record on the date when the meeting is
called. The business of each meeting of Members shall be limited to the
purposes described in the notice. A written waiver of notice, executed before
or after a meeting by a Member or its authorized attorney and delivered to the
Managers, shall be deemed equivalent to notice of the meeting.
(b) Members holding a majority of the Membership Interests shall
constitute a quorum for the transaction of any business at a meeting of Members.
Members may attend a meeting in person or by proxy. Members may also
participate in a meeting by means of conference telephone or similar
communications equipment that permits all Members present to hear each other.
If less than a quorum of the Members is present, the meeting may be adjourned by
the chairman to a later date, time and place, and the meeting may be held as
adjourned without further notice. When an adjourned meeting is reconvened, any
business may be transacted that might have been transacted at the original
meeting.
(c) A chairman selected by the Managers shall preside at all meetings
of the Members unless the Managers determine that the Members shall elect from
the Membership a chairman of the meeting. The chairman shall determine the
order of business and the procedures to be followed at each meeting of Members.
2.05 ACTION WITHOUT A MEETING. There is no requirement that the Members
hold a meeting in order to take action on any matter or that meetings be held
annually or at all. Any action required or permitted to be taken by the Members
may be taken without a meeting if one or more written consents to such action
shall be signed by the holders of the amount of Membership Interests required to
approve the action being taken. Such written consents shall be delivered to the
Managers at the principal office of the LLC and, unless otherwise specified,
shall be effective on the date when the first consent is so delivered.
2.06 VOTING RIGHTS. Unless otherwise required by the Act or specified
herein, all actions, approvals and consents to be taken or given by the Members
under the Act, this Agreement or otherwise shall require the affirmative vote or
written consent of Members holding at least 95% of the percentage interests of
Members in the profits and losses of the LLC as specified on MEMBER (herein the
"MEMBERSHIP INTERESTS") except for the following matters which shall require the
approval of Members or Manager-Members (as defined below) who hold the indicated
percentage of the Membership Interests held by all Members or Manager-Members:
(a) Admission of the transferee of a Member's interest in the LLC as a
substitute Member under Section 8.02 hereof: a majority of the Membership
Interests held by Members who are also Managers ("MANAGER-MEMBERS"), exclusive
of the Member whose interest is being transferred;
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(b) Continuation of the LLC after its dissolution due to the
withdrawal of a Member as provided in Section 9.01(b) hereof: except as
otherwise required by law, a majority of the Membership Interests held by the
remaining Members; and
(c) Dissolution of the LLC, sale of all or substantially all of its
assets not in the ordinary course of its business, or its merger or
consolidation with another business entity under the Act: a majority of the
Membership Interests held by Manager-Members.
2.07 LIMITATION OF LIABILITY OF MEMBERS. Except as otherwise provided
in the Act, no Member of the LLC shall be obligated personally for any debt,
obligation or liability of the LLC or of any other Member, whether arising in
contract, tort or otherwise, solely by reason of being a Member or Manager of
the LLC. Except as otherwise provided in the Act, by law or expressly in this
Agreement, no Member (including any Manager) shall have any fiduciary or other
duty to another Member with respect to the business and affairs of the LLC, and
no Member (including any Manager) shall be liable to the LLC or any other Member
for acting in good faith reliance upon the provisions of this Agreement. No
Member (including any Manager) shall have any responsibility to restore any
negative balance in its Capital Account (as defined in Section 6.01) or to
contribute to or in respect of the liabilities or obligations of the LLC or
return distributions made by the LLC except as required by the Act or other
applicable law; PROVIDED, HOWEVER, that Members are responsible for their
failure to make required Contributions under Section 6.02. The failure of the
LLC to observe any formalities or requirements relating to the exercise of it
powers or the management of its business or affairs under this Agreement or the
Act shall not be grounds for making its Members or Managers responsible for the
liabilities of the LLC.
2.08 AUTHORITY. Unless specifically authorized by the Managers, no Member
that is not a Manager shall be an agent of the LLC or have any right, power or
authority to act for or to bind the LLC or to undertake or assume any obligation
or responsibility of the LLC or of any other Member.
2.09 NO RIGHT TO WITHDRAW. No Member shall have any right to resign or
withdraw from the LLC without the consent of Managers who hold a majority of the
Membership Interests held by Manager-Members, which consent may be withheld in
their sole discretion, or to receive any distribution or the repayment of its
capital contribution except as provided in Section 7.02 and Article IX upon
dissolution and liquidation of the LLC.
2.10 RIGHTS TO INFORMATION. Members shall have the right to receive from
the Managers upon request a copy of the Certificate and of this Agreement, as
amended from time to time, and such other information regarding the LLC as is
required by the Act, subject to reasonable conditions and standards established
by the Managers, as permitted by the Act, which may include, without limitation,
withholding or restrictions on the use of confidential information.
2.11 NO APPRAISAL RIGHTS. No Member shall have any right to have its
interest in the LLC appraised and paid out under the circumstances provided in
Section 18-210 of the Act, or under any other circumstances.
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ARTICLE III - MANAGEMENT
3.01 MANAGERS. ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (hereinafter
"MESSRS. ▇▇▇▇▇▇▇▇▇ AND LINDE") are hereby appointed to serve as the initial
Managers of the LLC. The names and addresses of the Managers shall be listed on
MEMBER and said schedule shall be amended from time to time by the Managers to
reflect the resignation or removal of the Managers or the appointment of new or
additional Managers pursuant to this Agreement.
3.02 MANAGER RESPONSIBILITY. Each Manager shall devote such time to the
business and affairs of the LLC as is reasonably necessary for the performance
of the Manager's duties, but shall not be required to devote full time to the
performance of such duties and may delegate its responsibilities as provided in
Section 3.03.
3.03 POWERS AND DUTIES OF THE MANAGERS. The business and affairs of the
LLC shall be conducted by or under the direction of the Managers, who shall have
and may exercise on behalf of the LLC all of its rights, powers, duties and
responsibilities under Section 1.02 or as provided by law, including without
limitation the right and authority:
(a) to manage the business and affairs of the LLC and for this purpose
to employ, retain or appoint any officers, employees, consultants, agents,
brokers, professionals or other persons in any capacity for such compensation
and on such terms as the Managers deem necessary or desirable and to delegate to
such persons such of its duties and responsibilities as the Managers shall
determine;
(b) to enter into, execute, deliver, acknowledge, make, modify,
supplement or amend any documents or instruments in the name of the LLC which
the Managers deem necessary or appropriate to achieve the purpose of the LLC,
including, without limitation, contracts, agreements, leases, subleases,
easements, deeds, notes, mortgages and other documents or instruments of any
kind or character or amendments of any such documents or instruments;
(c) to borrow money or otherwise obtain credit and other financial
accommodations on behalf of the LLC from individuals, banks and other lending
institutions on a secured or unsecured basis as provided in Section 1.02(c), and
to perform or cause to be performed all of the LLC's obligations in respect of
its indebtedness and any mortgage, lien or security interest securing such
indebtedness;
(d) to make elections and prepare and file returns regarding any
federal, state or local tax obligations of the LLC, and to designate one of the
Managers to serve as the "Tax Matters Partner" of the LLC for purposes of
Section 6231(a)(7) of the Internal Revenue Code of 1986 as amended (the "CODE"),
with power to manage and represent the LLC in any administrative proceeding of
the Internal Revenue Service;
(e) to purchase or lease real and personal property on behalf of the
LLC;
(f) to deal in and with the assets of the LLC, including without
limitation, selling, leasing, developing, constructing, improving,
rehabilitating, operating, maintaining,
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mortgaging, encumbering, creating easements or restrictions, and conveying all
or any part of any real or personal property of the LLC, and to enter into
agreements of merger or consolidation;
(g) to enter into contracts for the construction, development,
improvement, servicing, operation, maintenance, repair and rehabilitation of the
Property;
(h) to bring, defend, compromise, collect, pay, adjust, arbitrate or
otherwise take any action and exercise any remedies with respect to any
receivable held by or claim available to or against the LLC;
(i) to pay LLC expenses incurred in the administration and operation
of the business and affairs of the LLC;
(j) to procure and maintain, at the expense of the LLC and with
responsible companies, such insurance as may be available in such amounts and
covering such risks as are appropriate in the sole discretion of the Managers,
including, without limitation, insurance policies insuring the Managers against
liability arising as a result of any action they may take or fail to take in
their capacity as Managers of the LLC; and
(l) to take any other action permitted or required of the Managers
under applicable law.
Any action taken by a Manager, and the signature of a Manager on any agreement,
contract, instrument or other document on behalf of the LLC, shall be sufficient
to bind the LLC and shall conclusively evidence the authority of that Manager
and the LLC with respect thereto.
3.04 RELIANCE BY THIRD PARTIES. Any person dealing with the LLC, the
Managers or any Member may rely upon a certificate signed by any one Manager as
to (i) the identity of any Managers or Members; (ii) any factual matters
relevant to the affairs of the LLC; (iii) the persons who are authorized to
execute and deliver any document on behalf of the LLC; or (iv) any action taken
or omitted by the LLC, the Managers or any Member.
3.05 RESIGNATION AND REMOVAL. Any Manager may resign upon at least
sixty (60) days' notice to the Members and the other Managers (unless notice is
waived by them).
3.06 COMPENSATION. The Managers shall be entitled to reimbursement
for out-of-pocket expenses incurred by them in managing and conducting the
business and affairs of the LLC, including a portion of the overhead of a
Manager's regular employer that is reasonably allocable to the activities of
that Manager relating to the LLC.
3.07 MEETINGS AND ACTION OF MANAGERS. Unless otherwise determined by
the Members, all action to be taken by the Managers of the LLC shall be taken by
vote or written consent of a majority of the Managers then in office. There is
no requirement that the Managers hold a meeting in order to take action on any
matter. Meetings of the Managers may be called by any Manager. If no meeting
of the Managers has been called to act on a matter, and action is taken on such
matter without a meeting by less than all of the Managers, prompt
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notice thereof shall be given to any Manager who did not participate in taking
such action. If action is to be taken at a meeting of the Managers, notice of
the time, date and place of the meeting shall be given to each Manager by an
officer or the Manager calling the meeting by personal delivery, telephone or
fax sent to the business or home address of each Manager at least 24 hours in
advance of the meeting, or by written notice mailed to each Manager at either
such address at least 72 hours in advance of the meeting; however, no notice
need be given to a Manager who waives notice before or after the meeting, or who
attends the meeting without protesting at or before its commencement the
inadequacy of notice to him or her. Managers may attend a meeting in person or
by proxy, and they may also participate in a meeting by means of conference
telephone or similar communications equipment that permits all Managers to hear
each other. A chairman selected by the Managers shall preside at all meetings
of the Managers. The chairman shall determine the order of business and the
procedures to be followed at each meeting of the Managers.
3.08 LIMITATION OF LIABILITY OF MANAGER; CERTAIN RELATED PARTY
TRANSACTIONS. No Manager shall be obligated personally for any debt, obligation
or liability of the LLC or of any Member, whether arising in contract, tort or
otherwise, solely by reason of being or acting as Manager of the LLC. No Manager
shall be personally liable to the LLC or to its Members for acting in good faith
reliance upon the provisions of this Agreement, or for breach of any fiduciary
or other duty that does not involve (i) a breach of the duty of loyalty to the
LLC or its Members, (ii) acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law; or (iii) a transaction
from which the Manager derived an improper personal benefit. The Members as of
the date this agreement is initially entered into agree and acknowledge that the
LLC will have continuous, on-going and significant business dealings and
relationships with entities controlled by or under common control with the
Managers (or in which the Managers have a significant interest) and on reliance
that the agreement set forth in the next sentence would be entered into.
Therefore, all Members agree, on behalf of themselves and their successors in
interest, that the Managers shall in no event be liable (for breach of the duty
of loyalty, care, disclosure or otherwise) for any contract entered into by the
LLC with Boston Properties Limited Partnership or any of its affiliates or any
business dealings or relationships between the LLC and any of such entities (a
"BPLP RELATED PARTY TRANSACTION"). As such, all Members agree, on behalf of
themselves and their successors in interest, that they will bring no act and
initiate no proceeding to contest such activities or contracts.
3.09 CHANGE OF CONTROL BY MEMBERS THAT ARE CORPORATIONS. Any Member
that is a corporation agrees that it will be a violation of this agreement if
the current record and beneficial owners of the capital stock of such
corporation dispose of such record or beneficial ownership in any manner without
the consent of all of the Managers.
ARTICLE IV - INDEMNIFICATION
4.01 RIGHT TO INDEMNIFICATION. To the fullest extent permitted by
law and subject to the provisions of this Article, the LLC shall indemnify each
of its Managers against any and all losses, costs, damages, fees, claims,
liabilities and expenses incurred by them in connection with any proceeding in
which a Manager is involved as a result of serving in such capacity, except that
no indemnification shall be provided for a Manager regarding any matter
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(other than a BPLP Related Party Transaction) as to which it shall be finally
determined that said Manager did not act in good faith and in the reasonable
belief that its action was in the best interests of the LLC, or with respect to
a criminal matter, that it had reasonable cause to believe that its conduct was
unlawful. Subject to the foregoing limitations, such indemnification may be
provided by the LLC with respect to a proceeding in which it is claimed that a
Manager received an improper personal benefit by reason of its position,
regardless of whether the claim arises out of the Manager's service in such
capacity, except for matters as to which it is finally determined that an
improper personal benefit (other than as a result of a BPLP Related Party
Transaction) was received by the Manager.
4.02 AWARD OF INDEMNIFICATION. The determination of whether the LLC
is authorized to indemnify a Manager hereunder and any award of indemnification
shall be made in each instance (a) by a majority of the Managers who are not
parties to the proceeding in question, (b) by independent legal counsel
appointed by the Managers or the Members, or (c) by the holders of a majority of
the Membership Interests of the Members who are not parties to the proceeding in
question. The LLC shall be obliged to pay indemnification applied for by a
Manager unless there is an adverse determination (as provided above) within
forty-five (45) days after the application. If indemnification is denied, the
applicant may seek an independent determination of its right to indemnification
by a court, and in such event, the LLC shall have the burden of proving that the
applicant was ineligible for indemnification under this Article.
Notwithstanding the foregoing, in the case of a proceeding by or in the right of
the LLC in which a Manager is adjudged liable to the LLC, indemnification
hereunder shall be provided to said Manager only upon a determination by a court
having jurisdiction (or, if binding arbitration is agreed to, the arbitration
thereof) that in view of all the circumstances of the case, said Manager is
fairly and reasonably entitled to indemnification for such expenses as the court
shall deem proper.
4.03 SUCCESSFUL DEFENSE. Notwithstanding any contrary provisions of
this Article, if a Manager has been wholly successful on the merits in the
defense of any proceeding in which it was involved by reason of its position as
Manager or as a result of serving in such capacity (including termination of
investigative or other proceedings without a finding of fault on the part of the
Manager), the Manager shall be indemnified by the LLC against all expenses
incurred by the Manager in connection therewith.
4.04 ADVANCE PAYMENTS. Except as limited by law, expenses incurred
by a Manager in defending any proceeding, include a proceeding by or in the
right of the LLC, shall be paid by the LLC to the Manager in advance of final
disposition of the proceeding upon receipt of its written undertaking to repay
such amount if the Manager is determined pursuant to this Article or adjudicated
to be ineligible for indemnification, which undertaking shall be an unlimited
general obligation but need not be secured and may be accepted without regard to
the financial ability of the Manager to make repayment.
4.05 DEFINITIONS. For purposes of this Article:
"MANAGER" includes (i) a person serving as an officer of the LLC or in
a similar executive capacity appointed by the Managers and exercising
rights and duties delegated by the Managers, (ii) a person serving at
the request of the LLC
9
as a director, manager, officer, employee or other agent of another
organization, and (iii) any person who formerly served in any of the
foregoing capacities ;
"EXPENSES" means all expenses, including attorneys' fees and
disbursements, actually and reasonably incurred in defense of a
proceeding or in seeking indemnification under this Article, and
except for proceedings by or in the right of the LLC or alleging that
a Manager received an improper personal benefit, any judgments,
awards, fines, penalties and reasonable amounts paid in settlement of
a proceeding; and
"PROCEEDING" means any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or
investigative, and any claim which could be the subject of a
proceeding.
4.06 INSURANCE. The LLC shall have power to purchase and maintain
insurance on behalf of any Manager, officer, agent or employee against any
liability or cost incurred by such person in any such capacity or arising out of
its status as such, whether or not the LLC would have power to indemnify against
such liability or cost.
4.07 EMPLOYEE BENEFIT PLAN. If the LLC or any Manager sponsors or
undertakes any responsibility as a fiduciary with respect to an employee benefit
plan, then for purposes of this Article (i) "MANAGER" shall be deemed to include
said Manager or any officer of the LLC who serves at its request in any capacity
with respect to said plan, (ii) said Manager or officer shall not be deemed to
have failed to act in good faith or in the reasonable belief that its action was
in the best interests of the LLC if said Manager or officer acted in good faith
and in the reasonable belief that its action was in the best interests of the
participants or beneficiaries of said plan, and (iii) "EXPENSES" shall be deemed
to include any taxes or penalties imposed upon said Manager or officer with
respect to said plan under applicable law.
4.08 HEIRS, SPOUSES, CHILDREN AND PERSONAL REPRESENTATIVES. The
indemnification provided by this Article shall inure to the benefit of the
heirs, spouses, children and personal representatives of each Manager.
4.09 NON-EXCLUSIVITY. The provisions of this Article shall not be
construed to limit the power of the LLC to indemnify its Managers, Members,
officers, employees or agents to the full extent permitted by law or to enter
into specific agreements, commitments or arrangements for indemnification
permitted by law. The absence of any express provision for indemnification
herein shall not limit any right of indemnification existing independently of
this Article.
4.10 AMENDMENT. The provisions of this Article may be amended or
repealed in accordance with Section 10.05; however, no amendment or repeal of
such provisions that adversely affects the rights of a Manager under this
Article with respect to its acts or omissions at any time prior to such
amendment or repeal shall apply to said Manager without its consent.
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ARTICLE V - CONFLICTS OF INTEREST
5.01 TRANSACTIONS WITH INTERESTED PERSONS. No contract or transaction
engaged in by the LLC that constitutes a BPLP Related Party Transaction, and
(unless entered into in bad faith) no other contract or transaction between the
LLC and one or more of its Managers or Members or between the LLC and any other
corporation, partnership, association or other organization in which one or more
of its Managers or Members have a financial interest or are directors, partners,
Managers or officers, shall be voidable solely for this reason or solely because
said Manager or Member was present or participated in the authorization of such
contract or transaction if:
(a) the material facts as to the relationship or interest of said
Manager or Member and as to the contract or transaction were disclosed or known
to the other Managers (if any) or Members and the contract or transaction was
authorized by the disinterested Managers (if any) or Members; or
(b) the contract or transaction was fair to the LLC as of the time it
was authorized, approved or ratified by the disinterested Managers (if any) or
Members; or
(c) the contract or transaction was a BPLP Related Party Transaction;
and no Manager or Member interested in such contract or transaction, because of
such interest, shall be considered to be in breach of this Agreement or liable
to the LLC, any Manager or Member, or any other person or organization for any
loss or expense incurred by reason of such contract or transaction or shall be
accountable for any gain or profit realized from such contract or transaction.
5.02 OUTSIDE BUSINESSES. Any Manager or Member may engage or have an
interest in other business ventures which are similar to or competitive with the
business of the LLC, including, but not limited to, the ownership, financing,
leasing, operation, management, syndication, brokerage, or development of real
property competitive with real property owned or leased by the LLC, and the
pursuit of such ventures, even if competitive, shall not be deemed wrongful or
improper or give the LLC, its Managers or the other Members any rights with
respect thereto. No Manager or Member shall be obligated to present an
investment opportunity to the LLC even if it is similar to or consistent with
the business of the LLC, and such Member or Manager shall have a right to take
for their own account or recommend to others any such investment opportunity.
ARTICLE VI - CAPITAL ACCOUNTS AND CONTRIBUTIONS
6.01 CAPITAL ACCOUNTS. A separate capital account (a "CAPITAL ACCOUNT")
shall be maintained for each Member in accordance with Section 1.704-1(b)(2)(iv)
of the U.S. Treasury Regulations (the "REGULATIONS"), and this Section 6.01
shall be interpreted and applied in a manner consistent with said Section of the
Regulations. The LLC shall adjust the Capital Accounts of its Members to reflect
revaluations of the LLC property whenever the adjustment would be permitted
under Regulations Section 1.704-1(b)(2)(iv)(f). In the event that the Capital
Accounts of the Members are so adjusted, (i)
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the Capital Accounts of the Members shall be adjusted in accordance with
Regulations Section 1.704-1(b)(2)(iv)(g) for allocations of depreciation,
depletion, amortization and gain or loss, as computed for book purposes, with
respect to such property and (ii) the Members' distributive shares of
depreciation, depletion, amortization and gain or loss, as computed for tax
purposes, with respect to such property shall be determined so as to take
account of the variation between the adjusted tax basis and book value of such
property in the same manner as under Section 704(c) of the Code. In the event
that Code Section 704(c) applies to LLC property, the Capital Accounts of the
Members shall be adjusted in accordance with Regulations Section 1.704-
1(b)(2)(iv)(g) for allocations of depreciation, depletion, amortization and gain
and loss, as computed for book purposes, with respect to such property. In
applying clause (ii) of the second preceding sentence and all of the preceding
sentence, the provisions of Code Section 704(b) shall apply. The Capital
Accounts shall be maintained for the sole purpose of allocating items of income,
gain, loss and deduction among the Members and shall have no effect on the
amount of any distributions to any Members in liquidation or otherwise. The
amount of all distributions to Members shall be determined pursuant to Section
7.01. Notwithstanding any provision contained herein to the contrary, no Member
shall be required to restore any negative balance in its Capital Account.
6.02 CONTRIBUTIONS. Each Member shall make the contributions to the
capital of the LLC (herein "CONTRIBUTIONS") specified on SCHEDULE A. All
Contributions shall be paid in cash unless otherwise specified on SCHEDULE A or
agreed to by the Members. Except as set forth on SCHEDULE A, no Member or
Manager shall be entitled or required to make any contribution to the capital of
the LLC; however, the LLC may borrow from its Members as well as from banks or
other lending institutions to finance its working capital or the acquisition of
assets upon such terms and conditions as shall be approved by the Managers, and
any borrowing from Members shall not be considered Contributions or reflected in
their Capital Accounts. The value of all non-cash Contributions made by Members
shall be set forth on SCHEDULE A. No Member shall be entitled to any interest or
compensation with respect to its Contribution or any services rendered on behalf
of the LLC except as specifically provided in this Agreement or approved by the
Managers. No Member shall have any liability for the repayment of the
Contribution of any other Member and each Member shall look only to the assets
to the LLC for return of its Contribution. In no event shall ▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ or any other E-Related Party or Z-Related Party (as
defined in the Amended and Restated Certificate of Incorporation of Boston
Properties, Inc.) own, in the aggregate, more than 9.8% of the Membership
Interests or have a claim to the profits or assets of the LLC in excess of such
percentage, and any transaction that would cause such parties to exceed, in the
aggregate, such percentage with respect to Membership Interests or claims to the
profits or assets of the LLC shall be null and void AB INITIO.
6.03 FAILURE TO CONTRIBUTE. If a Member fails to make a Contribution
that he has subscribed for, the LLC may exercise one or more of the following
remedies as determined by the Managers after notice to the defaulting Member:
(a) Taking such action, including without limitation court
proceedings, as the Managers deem appropriate to obtain payment by the
defaulting Member of the Contribution due plus interest at the maximum rate
permitted by law and costs of collection, including reasonable attorneys' fees
and disbursements, and the defaulting Member consents
12
for this purpose to service of process, venue and jurisdiction in a court in the
state in which the principal office of the LLC is located;
(b) Selling all or any part of the interest of the defaulting Member
in the LLC at a public or private foreclosure sale under the procedures
permitted by the applicable Uniform Commercial Code to be used by a defaulted
secured creditor (the LLC shall be deemed to have been granted a security
interest in the interest of the defaulting Member in the LLC for this purpose);
(c) Collecting the Contribution due plus interest and expenses as
provided in paragraph (a) by offset against distributions and other amounts due
to the defaulting Member pursuant to Section 10.01;
(d) Reduction, forfeiture or elimination of all or part of the
interest of the defaulting Member in the LLC;
(e) Subordination of the interest of the defaulting Member in the LLC
to the interests of the other Members; and
(f) Arranging for other Members to furnish the Contribution due as a
loan to the defaulting Member on such terms and conditions as the Managers deem
appropriate, including without limitation, the granting of a security interest
in the interest of the defaulting Member to secure such loan; and
(g) Redemption of the interest of the defaulting Member in the LLC or
sale of said interest to other Members at its fair value determined by an
appraisal procedure or formula which the Managers determine to be appropriate
under the circumstances.
Claims against a Member for failure to make a Contribution or to return money or
other property paid or distributed to him in violation of the Act or this
Agreement may be compromised by the Managers without the consent of the Members.
ARTICLE VII - DISTRIBUTIONS AND ALLOCATIONS
7.01 DISTRIBUTION OF LLC FUNDS. Except as provided subsequently in this
Article, all funds and assets of the LLC which are determined by the Managers to
be available for distribution shall be distributed to the Members (including the
Manager-Members) in proportion to their Membership Interests. No Member shall be
entitled to any distribution or payment with respect to its interest in the LLC
upon the resignation or withdrawal of such Member except to the extent that the
LLC exercises its option to purchase the interest of such Member under Section
9.04. Distributions may be limited and repayable as provided in the Act.
7.02 DISTRIBUTION UPON DISSOLUTION. Proceeds from a sale or liquidation
of all or substantially all of the assets of the LLC and amounts available upon
dissolution, after payment of, or adequate provision for, the debts and
obligations of the LLC, including the expenses of its liquidation and
dissolution, and liabilities to its Managers or Members, if any,
13
other than liabilities to Members for distributions, shall be distributed and
applied in the following priorities:
(a) FIRST, to fund reserves to the extent deemed appropriate by the
Managers for contingent, conditional, unmatured or other liabilities of the LLC
not otherwise paid or provided for, PROVIDED THAT, upon the expiration of such
period of time as the Managers shall deem advisable, the balance of such
reserves remaining after payment of such liabilities shall be distributed in the
manner hereinafter set forth;
(b) SECOND, to Members to satisfy any liabilities for distributions
previously determined to be due by the Managers or due under this Agreement; and
(c) THIRD, to Members as provided in Section 7.01.
7.03 DISTRIBUTION OF ASSETS IN KIND. No Member shall have the right to
require any distribution of any assets of the LLC to be made in cash or in kind.
If the Managers determine to distribute assets of the LLC in kind, such assets
shall be distributed on the basis of their fair market value as determined by
the Managers. Any Member entitled to any interest in such assets shall, unless
otherwise determined by the Managers, receive separate assets of the LLC, and
not an interest as tenant-in-common with other Members so entitled in each asset
being distributed. Distributions in kind need not be made on a pro-rata basis,
but may be made on any basis which the Managers determine to be reasonable under
the circumstances.
7.04 ALLOCATION OF PROFITS AND LOSSES.
All items of LLC income, gain, loss and deduction as determined for
book purposes shall be allocated among the Members and credited or debited to
their respective Capital Accounts in accordance with Regulations Section 1.704-
1(b)(2)(iv), so as to ensure to the maximum extent possible (i) that such
allocations satisfy the economic effect equivalence test of Regulations Section
1.704-1(b)(2)(ii)(i) (as provided hereinafter) and (ii) that all allocations of
items that cannot have economic effect (including credits and nonrecourse
deductions) are allocated to the Members in proportion to their Membership
Interests unless otherwise required by Code section 704(b) and the Regulations
promulgated thereunder. To the extent possible, items that can have economic
effect shall be allocated in such a manner that the balance of each Member's
Capital Account at the end of any taxable year (increased by such Member's
"share of partnership minimum gain" as defined in Regulations Section 1.704-2)
would be positive to the extent of the amount of cash that such Member would
receive (or would be negative to the extent of the amount of cash that such
Member should be required to contribute to the LLC) if the LLC sold all of its
property for an amount of cash equal to the book value (as determined pursuant
to Regulations Section 1.704.1(b)(2)(iv)) of such property (reduced, but not
below zero, by the amount of nonrecourse debt to which such property is
subject) and all of the cash of the LLC remaining after payment of all
liabilities (other than nonrecourse liabilities) of the LLC were distributed in
liquidation immediately following the end of such taxable year in accordance
with Section 7.01.
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ARTICLE VIII - TRANSFERS OF INTERESTS
8.01 GENERAL RESTRICTIONS ON TRANSFER. No Member may assign, transfer,
pledge or grant a security interest in all or any part of its interest in the
LLC, directly or indirectly, except with the prior written approval of the
Managers, which approval may be withheld or denied for any reason or for no
reason. In the event that a Member receives such prior written approval to its
transfer of a Membership Interest for value, such proposed transaction shall be
subject to the right of first refusal set forth in Section 8.06. If the interest
of a Manager-Member is being transferred, the approval of a majority of the
other Managers shall be required, or if there are none, the approval of Members
holding a majority of the Membership Interests.
The LLC and its Managers and Members shall be entitled to treat the record
owner of an interest in the LLC as the absolute owner thereof in all respects,
and shall incur no liability for distributions of cash or other property made in
good faith to such owner until such time as a written assignment of such
interest has been received and accepted by the Managers and recorded on the
books of the LLC. The Managers may refuse to accept and record an assignment
until the end of the next successive quarterly accounting period of the LLC.
8.02 REQUIREMENTS FOR TRANSFER. Every transfer of an interest in the LLC
permitted hereunder shall be subject to the following requirements:
(a) The transferee shall establish that the proposed transfer will
not cause or result in a breach of any agreement binding upon the LLC or any
violation of law, including without limitation, federal or state securities
laws, and that the proposed transfer would not cause the LLC to be an investment
company as defined in the Investment Company Act of 1940, as amended;
(b) The transferee shall establish to the satisfaction of the
Managers that the transferee is financially responsible and of good character
and that the transfer would not adversely affect the classification of the LLC
as a partnership for federal tax purposes, terminate its classification as a
partnership under Code Section 708, or have a substantial adverse effect with
respect to federal income taxes payable by the LLC; and
(c) The transferee shall execute a counterpart of this Agreement and
such other documents or instruments as may be required by the Managers to
reflect the provisions hereof.
Until the foregoing requirements are met, the LLC need not recognize the
transferee for any purpose under this Agreement, and the transferee shall be
entitled only to the rights of a transferee who is not a Member under the Act. A
transferee shall not be admitted as a Member without the approval of the
Manager-Members (exclusive of the Member whose interest is being transferred) as
provided in Section 2.06(a).
8.03 EFFECT OF TRANSFER.
(a) If the transferee is admitted as a Member or is already a Member,
the Member transferring its interest shall be relieved of liability with respect
to the transferred
15
interest arising or accruing under this Agreement on or after the effective date
of the transfer, unless the transferor affirmatively assumes such liability;
PROVIDED, HOWEVER, that the transferor shall not be relieved of any liability
for prior distributions and unpaid Contributions unless the transferee
affirmatively assumes such liabilities.
(b) Any person who acquires in any manner an interest or any part
thereof in the LLC, whether or not such person has accepted and assumed in
writing the terms and provisions of this Agreement or been admitted as a Member,
shall be deemed by the acquisition of such interests to have agreed to be
subject to and bound by all of the provisions of this Agreement with respect to
such interest, including without limitation, the provisions hereof with respect
to any subsequent transfer of such interest.
8.04 PROHIBITED TRANSFERS. Any transfer in violation of any provisions of
this Agreement shall be null and void and ineffective to transfer any interest
in the LLC and shall not be binding upon or be recognized by the LLC, and any
such transferee shall not be treated as or deemed to be a Member for any
purpose. In the event that any Member shall at any time transfer its interest in
violation of any of the provisions of this Agreement, the LLC and the other
Members, in addition to all rights and remedies at law and equity, shall have
and be entitled to an order restraining or enjoining such transaction, it being
expressly acknowledged and agreed that damages at law would be an inadequate
remedy for a transfer in violation of this Agreement.
8.05 RIGHT OF FIRST REFUSAL.
(a) In the event that the Managers consent and thereby grant the
prior written approval to a transfer of a Membership Interest for value as
required by Section 8.01, and subject to the requirements of Section 8.02, the
Member who proposes to transfer such Membership Interest (the "OFFEREE MEMBER")
shall be deemed to have granted the LLC a right of first refusal to purchase
said interest on the same terms and conditions as are stated in the offer
received by the Offeror, which right of first refusal shall be assignable in
whole or in part. The Offeree Member shall affirm to the Managers, if requested,
that the offer is bona fide, is the result of arms-length negotiations between
the Offeree Member and the person who proposes to purchase such interest from
the Offeree Member (the "OFFEROR") and shall set forth the name of the Offeror,
the interest to be transferred, the price and other terms of the offer and any
other relevant material information available regarding the proposed transfer.
The Offeree Member shall deliver copies of the offer to the Managers.
(b) The LLC shall have an option (assignable in whole or in part,
including to a Manager) to acquire all or any part of the interest proposed to
be transferred at the price, terms and conditions set forth in the offer
received by the Offeree Member. The LLC and/or its assign shall have thirty
(30) days from receipt of a notice regarding the proposed transfer which
contains the terms of the offer received by the Offeree Member in which to
notify the Offeree Member of its election to purchase all or a portion of the
interest proposed to be transferred.
(c) The closing of the purchase by the LLC or its assigns shall take
place on a date not less than ten (10) days nor more than thirty (30) days after
all elections to purchase have been made, as specified by the LLC and the
purchasing assigns, if any.
16
(d) If the interest of the Offeree Member is not purchased by the LLC
or assigns as provided herein, the Offeree Member may sell such interest to the
Offeror upon the terms and conditions set forth in the offer (or other terms and
conditions no more favorable to the Offeror), provided that such sale is
concluded within ninety (90) days after the expiration of the period in which
elections to purchase may be made by the LLC or assigns, and the Offeror
complies with all of the provisions of Section 8.02.
(e) No transferee of an interest in the LLC shall be admitted as a
Member of the LLC without the consent required under Section 2.06(a) and 8.02.
8.06 TRANSFERS OF INTERESTS BY MANAGER-MEMBER. A transfer of an interest
in the LLC by a Manager-Member shall transfer only the economic interests,
rights, duties and obligations of the transferor in its capacity as a Member,
and no transferee shall obtain as a result of any such assignment any rights as
a Manager. A Manager-Member who transfers all (but not less than all) of its
interest in the LLC as a Member shall be deemed to have tendered its resignation
as a Manager to the LLC effective on the date of such transfer, and such
resignation shall be deemed to have been accepted unless it is rejected within
thirty (30) days thereafter.
ARTICLE IX - DISSOLUTION, LIQUIDATION, AND TERMINATION
9.01 DISSOLUTION. The LLC shall dissolve and its affairs shall be wound
up upon the first to occur of the following:
(a) the written consent of all of the Members;
(b) the entry of a decree of judicial dissolution under Section 18-
802 of the Act; or
(c) a consolidation or merger of the LLC in which it is not the
resulting or surviving entity.
The Managers shall promptly notify the Members of the dissolution of the
LLC.
9.02 LIQUIDATION. Upon dissolution of the LLC, the Managers shall act
as its liquidating trustee or the Managers may appoint one or more Managers
or Members as liquidating trustee. The liquidating trustee shall proceed
diligently to liquidate the LLC, to wind up its affairs and to make final
distributions as provided in Section 7.02 and in the Act. The costs of
dissolution and liquidation shall be an expense of the LLC. Until final
distribution, the liquidating trustee may continue to operate the business and
properties of the LLC with all of the power and authority of the Managers. As
promptly as possible after dissolution and again after final liquidation, the
liquidating trustee shall cause an accounting of the LLC's assets, liabilities,
operations and liquidating distributions to be given to the Members.
9.03 CERTIFICATE OF CANCELLATION. Upon completion of the distribution of
LLC assets as provided herein, the LLC shall be terminated, and the Managers (or
such other
17
person or persons as the Act may require or permit) shall file a Certificate of
Cancellation with the Secretary of State of Delaware under the Act, cancel any
other filings made pursuant to Sections 1.01, 1.03 and 1.05, and take such other
actions as may be necessary to terminate the existence of the LLC.
ARTICLE X - GENERAL PROVISIONS
10.01 OFFSET. Whenever the LLC is obligated to make a distribution or
payment to any Member, any amounts that Member owes the LLC may be deducted from
said distribution or payment by the Managers.
10.02 NOTICES. Except as expressly set forth to the contrary in this
Agreement, all notices, requests, or consents required or permitted to be given
under this Agreement must be in writing and shall be deemed to have been given
(i) three (3) days after the date mailed by registered or certified mail,
addressed to the recipient, with return receipt requested, (ii) upon delivery to
the recipient in person or by courier, or (iii) upon receipt of a facsimile
transmission by the recipient. Such notices, requests and consents shall be
given (x) to Members at their addresses on SCHEDULE A, or such other address as
a Member may specify by notice to the Managers or to all of the other Members,
or (y) to the LLC or the Managers at the address of the principal office of LLC
specified in Section 1.03. Whenever any notice is required to be given by law,
the Certificate or this Agreement, a written waiver thereof, signed by the
person entitled to notice, whether before or after the time stated therein,
shall be deemed equivalent to the giving of such notice.
10.03 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
of the Members and the Managers relating to the LLC and supersedes all prior
contracts or agreements with respect to the LLC, whether oral or written.
10.04 LIMITATION OF LITIGATION; CONSENT TO JURISDICTION. No Member shall
be entitled to initiate or participate in a class action on behalf of all or any
part of the Members against the LLC, its Managers or any Member, and no Member
shall be entitled to initiate or participate in a derivative suit on behalf of
the LLC against its Managers or any Member, unless in each case such action or
suit has received prior approval of a majority of the Managers and Members
holding a majority of the Membership Interests who are not defendant parties to
the proposed action or suit, or unless otherwise required by law. No Manager
shall be entitled to initiate or participate in any suit on behalf of the LLC
against its Managers or any Members unless such suit has received the prior
approval of the Managers who are not defendant parties to the proposed suit,
unless otherwise required by law. A Member or Manager who initiates an action or
suit in violation of this Agreement shall be liable to the LLC and its Managers
and any Members who are defendant parties for all damages and expenses which
they incur as a result, including without limitation reasonable fees and
expenses of legal counsel and expert witnesses and court costs. The parties to
this Agreement hereby consent to the non-exclusive jurisdiction of the courts of
the State of Massachusetts in connection with any matter or dispute arising
under this Agreement or between them regarding the affairs of the LLC.
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10.05 AMENDMENT OR MODIFICATION. This Agreement may be amended or
modified from time to time only be a written instrument signed by a majority of
the Managers and by Members holding a majority of the Membership Interests;
PROVIDED, HOWEVER, that (a) an amendment or modification reducing a Member's
Membership Interest or changing adversely the rights of a Member with respect to
distributions, allocations or voting, (other than to reflect the admission of
new Members or changes otherwise provided by this Agreement) shall be effective
only with that Member's consent, (b) an amendment of modification to reflect the
admission of a new Member may be approved by the Managers alone if the new
Member is purchasing an interest from the LLC with rights equivalent to the
rights of existing Members, and otherwise shall be subject to approval by
Members holding a majority of the Membership Interests; and an amendment or
modification to reflect the admission of a new Member who is an assignee of an
existing Member, shall be subject to approval as provided in Section 2.06; (c)
an amendment or modification increasing any liability of a Member to the LLC or
its Managers or Members, or adversely affecting the limitation of the liability
of a Member with respect to the LLC, shall be effective only with that Member's
consent; (d) an amendment or modification reducing the required percentage of
Membership Interests for any consent or vote in this Agreement shall be
effective only with the consent or vote of Members having the percentage of
Membership Interests theretofore required; and (e) an amendment of this Section
shall require the consent of a majority of the Managers and of Members holding
two-thirds of the Membership Interests.
10.06 BINDING EFFECT. Subject to the restrictions on transfers set forth
in this Agreement, this Agreement is binding on and inures to the benefit of the
parties and their respective heirs, legal representatives, successors and
assigns.
10.07 GOVERNING LAW; SEVERABILITY. This Agreement is governed by and
shall be construed in accordance with the law of the State of Delaware,
exclusive of its conflict-of-laws principles. In the event of a conflict
between the provisions of this Agreement and any provision of the Certificate or
the Act, the applicable provision of this Agreement shall control, to the extent
permitted by law. If any provision of this Agreement or the application thereof
to any person or circumstance is held invalid or unenforceable to any extent,
the remainder of this Agreement and the application of that provision shall be
enforced to the fullest extent permitted by law.
10.08 FURTHER ASSURANCES. In connection with this Agreement and the
transactions contemplated hereby, each Member shall execute and deliver any
additional documents and instruments and perform any additional acts that may be
necessary or appropriate to effectuate and perform the provisions of this
Agreement and those transactions, as requested by the Managers.
10.09 WAIVER OF CERTAIN RIGHTS. Each Member irrevocably waives any right
it may have to maintain any action for dissolution of the LLC or for partition
of the property of the LLC.
10.10 NOTICE TO MEMBERS OF PROVISIONS OF THIS AGREEMENT. By executing
this Agreement, each Member acknowledges that such Member has actual notice of
(a) all of the provisions of this Agreement, including, without limitation, the
restrictions on the transfer of Membership Interests set forth in Article VIII
and all matters related to BPLP
19
Related Party Transactions, and (b) all of the provisions of the Certificate.
Each Member hereby agrees that this Agreement constitutes adequate notice of all
such provisions, and each Member hereby waives any requirement that any further
notice thereunder be given.
10.11 THIRD PARTY BENEFICIARIES. The provisions of this Agreement are not
intended to be for the benefit of any creditor or other person to whom any debts
or obligations are owed by, or who may have any claim against, the LLC or any of
its Members or Managers, except for Members or Managers in their capacities as
such. Notwithstanding any contrary provision of this Agreement, no such creditor
or person shall obtain any rights under this Agreement or shall, by reason of
this Agreement, be permitted to make any claim against the LLC or any Member or
Manager.
10.12 INTERPRETATION. For the purposes of this Agreement, terms not
defined in this Agreement shall be defined as provided in the Act; and all
nouns, pronouns and verbs used in this Agreement shall be construed as
masculine, feminine, neuter, singular, or plural, whichever shall be applicable.
Titles or captions of Articles and Sections contained in this Agreement are
inserted as a matter of convenience and for reference, and in no way define,
limit, extend or describe the scope of this Agreement or the intent of any
provision hereof.
10.13 COUNTERPARTS. This Agreement may be executed in any number of
counterparts with the same effect as if all parties had signed the same
document, and all counterparts shall be construed together and shall constitute
the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement under
seal as of the date set forth above.
Managers: __________________________________________
__________________________________________
__________________________________________
Members: __________________________________________
__________________________________________
__________________________________________
20
ZL HOTEL LLC
Member
==================================================================
Name and Address Contribution Membership
of Member Interest
==================================================================
ZL Hotel Corp. $[______] 90.2%
▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
==================================================================
==================================================================
Name and Address Contribution Membership
of manager Interest
==================================================================
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ $[______] 4.9%
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇, ▇▇ ▇▇▇▇▇
------------------------------------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ $[______] 4.9%
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
==================================================================
DOCS\513364.3
5/21/97
21