LTAC SPV I, LLC LIMITED LIABILITY COMPANY AGREEMENT Dated as of February 21, 2008
Exhibit
7.9
LTAC
SPV I, LLC
Dated
as of February 21, 2008
INTERESTS
IN THE COMPANY MAY ONLY BE SOLD, TRANSFERRED,
PLEDGED
OR HYPOTHECATED SUBJECT TO THE LIMITATIONS AND
RESTRICTIONS
SET FORTH HEREIN AND ONLY IN COMPLIANCE
WITH
ALL APPLICABLE SECURITIES LAWS
.
LTAC
SPV I, LLC
TABLE
OF CONTENTS
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ARTICLE
I FORMATION OF THE COMPANY
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3
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Section
1.1
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Formation
of the Company.
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3
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Section
1.2
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Name
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3
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Section
1.3
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Business
of the Company
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3
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Section
1.4
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Location
of Principal Office of the Company
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4
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Section
1.5
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Registered
Agent
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4
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Section
1.6
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Term
|
4
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ARTICLE
II DEFINITIONS
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4
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ARTICLE
III CAPITAL CONTRIBUTIONS
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6
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Section
3.1
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Capital
Contributions
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6
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Section
3.2
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No
Interest Paid on Capital Contribution(s)
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7
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Section
3.3
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Withdrawal
and Return of Capital Contributions
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7
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ARTICLE
IV ALLOCATION OF NET INCOME AND NET LOSS
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7
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Section
4.1
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Allocation
of Net Income and Net Loss
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7
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Section
4.2
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Other
Allocation Provisions
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7
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|
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Section
4.3
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Allocations
for Income Tax Purposes
|
8
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Section
4.4
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Withholding
|
8
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|
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ARTICLE
V DISTRIBUTIONS
|
8
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Section
5.1
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Distributions
Generally
|
8
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Section
5.2
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Limitations
on Distributions.
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9
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Section
5.3
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Reserves
|
9
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|
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ARTICLE
VI BOOKS OF ACCOUNT; RECORDS AND REPORTS; FISCAL
YEAR
|
9
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Section
6.1
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Books
and Records.
|
9
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Section
6.2
|
Reports
|
10
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|
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Section
6.3
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Fiscal
Year
|
10
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|
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ARTICLE
VII POWERS, RIGHTS AND DUTIES OF THE MEMBERS
|
10
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Section
7.1
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Limitations
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10
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Section
7.2
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Liability
|
10
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Section
7.3
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Priority
|
10
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Section
7.4
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Restriction
on Acquisition
|
10
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Section
7.5
|
No
Limitation on Managing Member
|
10
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ARTICLE
VIII POWERS, RIGHTS AND DUTIES OF THE MANAGING
MEMBER
|
10
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||
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Section
8.1
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Authority,
Power and Duties of the Managing Member
|
10
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|
|
Section
8.2
|
Company
Funds
|
11
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|
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Section
8.3
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Limits
on Managing Member's Powers
|
11
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|
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Section
8.4
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Tax
Matters Partner
|
11
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Section
8.5
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Exculpation;
Modification of Duties.
|
12
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Section
8.6
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Exculpation
and Indemnification of the Members.
|
12
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|
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Section
8.7
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Expenses
|
13
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Section
8.8
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Activities
of Managing Member; Conflicts of Interest
|
13
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Section
8.9
|
Removal
and Replacement of the Managing Member
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15
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ARTICLE
IX TRANSFERS
|
15
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Section
9.1
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Transfers
Generally
|
15
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Section
9.2
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Transfers
of Interests of Members.
|
15
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Section
9.3
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Consequences
of Transfers.
|
16
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Section
9.4
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Transferee
to Succeed to Transferor's Capital Account
|
16
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|
Section
9.5
|
Additional
Filings
|
16
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|
|
Section
9.6
|
Safe
Harbor Election in Connection with Certain Transfers
|
16
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ARTICLE
X WITHDRAWAL OF MEMBERS; TERMINATION OF THE
COMPANY;
LIQUIDATION AND DISTRIBUTION OF
ASSETS
|
17
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Section
10.1
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Withdrawal
of Members
|
17
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Section
10.2
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Dissolution
of the Company.
|
17
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Section
10.3
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Distribution
in Liquidation.
|
18
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Section
10.4
|
Final
Statement of Assets and Liabilities
|
19
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|
Section
10.5
|
No
Deficit Restoration Obligation
|
19
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Section
10.6
|
Termination
of the Company
|
19
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ARTICLE
XI ADMISSION OF ADDITIONAL MEMBERS
|
19
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Section
11.1
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Admission
of Additional Members
|
19
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ARTICLE
XII NOTICES AND VOTING
|
20
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Section
12.1
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Notices
|
20
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Section
12.2
|
Voting
|
20
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ARTICLE
XIII AMENDMENT OF AGREEMENT
|
20
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|
Section
13.1
|
Amendments.
|
20
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Section
13.2
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Amendment
of Certificate
|
20
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Section
13.3
|
Power
of Attorney
|
20
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ARTICLE
XIV MISCELLANEOUS
|
21
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Section
14.1
|
Entire
Agreement
|
21
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Section
14.2
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Applicable
Law
|
21
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Section
14.3
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Effect
|
22
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Section
14.4
|
Survival
|
22
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Section
14.5
|
Pronouns
and Number
|
22
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Section
14.6
|
Captions
|
22
|
|
|
Section
14.7
|
Partial
Enforceability
|
22
|
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|
Section
14.8
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Counterparts
|
22
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|
|
Section
14.9
|
No
Third Party Beneficiaries
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22
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LTAC
SPV I, LLC
LIMITED
LIABILITY COMPANY AGREEMENT of LTAC SPV I, LLC, dated as of February 21, 2008,
by ▇▇▇▇ Energy GP, LLC, a Delaware limited liability company, and Common Sense
Special Opportunity, LP, a Delaware limited liability company ("Common
Sense"). Capitalized terms not otherwise defined herein shall
have the meanings ascribed to them in Article
II.
WHEREAS,
the Company was formed as a Delaware limited liability company upon the filing
of the Certificate of Formation of the Company with the Office of the Secretary
of State of the State of Delaware on February 20, 2008;
NOW,
THEREFORE, in consideration of the mutual covenants contained in this Agreement,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE
I
FORMATION
OF THE COMPANY
Section
1.1 Formation of the
Company. The Company was formed as a limited liability company
under the Act by the filing of the Certificate with the Office of the Secretary
of State of the State of Delaware on February 20, 2008. The Managing
Member shall make all filings, recordings and publications and do all such other
acts as the Managing Member may determine to be necessary or appropriate for
compliance with all requirements applicable to the operation of the Company as a
limited liability company under this Agreement and the Act and under all other
laws of the State of Delaware and such other jurisdictions in which the Managing
Member may determine that the Company shall conduct business. Each
Member admitted to the Company by the Managing Member shall promptly execute all
relevant certificates and other documents as the Managing Member shall
request. Each Member shall provide such information regarding the
Member and its affiliates as the Managing Member may reasonably determine to be
necessary or appropriate in connection with (i) any filings with the Securities
and Exchange Commission or any Canadian securities regulator, including filings
on Schedule 13D or in connection with the proxy rules, (ii) any filings in
connection with obtaining any approvals under antitrust or similar laws, and
(iii) the performance of the Managing Member's duties under this
Agreement.
Section
1.2 Name. The name of
the Company is "LTAC SPV I, LLC." The Managing Member may from time
to time change the Company's name upon prior written notice to the other
Members.
Section
1.3 Business of the
Company. The purpose and business of the Company shall be to
purchase, acquire, buy, sell, own, trade in, hold and otherwise deal, directly
or indirectly, in Portfolio Company Securities. Subject to the terms
and conditions of this Agreement, the Company may enter into, make and perform
such contracts and other undertakings, and may engage in such activities and
transactions, as the Managing Member, in its
sole
discretion, may deem necessary or advisable to the carrying out of the foregoing
businesses of the Company.
Section
1.4 Location of Principal
Office of the
Company. The principal place of business of the Company shall
be ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇, or such other place as the
Managing Member shall select. The Managing Member may change the
location of the principal place of business of the Company by notice to the
other Members.
Section
1.5 Registered
Agent. The registered agent and office of the Company shall be
The Corporation Trust Company, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or
such other registered agent and registered office as the Managing Member may
designate from time to time.
Section
1.6 Term. The
term of the Company commenced upon the filing of the Certificate with the
Secretary of State of the State of Delaware on February 20, 2008, and the
Company shall remain in existence until terminated in accordance with
Article X.
ARTICLE
II
DEFINITIONS
"Act" means the
Delaware Limited Liability Company Act, Chapter 434 of Title 6 of the Delaware
Code, 6 Del. Code §18-101 et seq., as amended from time to time (or any
succeeding law).
"Adjusted Capital Account
Balance" means, at any time with respect to the Capital Account of any
Member, the balance of such Capital Account at such time increased by the sum of
(a) the amount of such Member's share of partnership minimum gain (as defined in
Regulation §1.704-2(g)(1) and (3)) and (b) the amount of such Member's share of
partner nonrecourse debt minimum gain (as defined in Regulation §1.704-2(i)(5))
and decreased by reasonably expected adjustments, allocations and distributions
described in Regulation §1.704-1(b)(2)(ii)(d)(4), (5) and (6).
"Agreement" means this
Limited Liability Company Agreement, as amended, modified or supplemented from
time to time.
"Assignees" has the
meaning set forth in Section 9.2(d).
"Business Day" means
any day on which commercial banks in New York, New York are open for
business.
"Capital Account"
means, with respect to each Member, the account established and maintained for
such Member on the books of the Company in compliance with Regulation
§§ 1.704-1(b)(2)(iv) and 1.704-2, as amended. Subject to the
preceding sentence, each Member's Capital Account initial balance shall equal
the amount of cash initially contributed by such Member to the
Company. Throughout the term of the Company, each Member's Capital
Account will be (i) increased by the amount of (A) income and gains of the
Company allocated to such Member pursuant to Article IV and (B)
the amount of any cash subsequently contributed by such Member to the Company,
and (ii) decreased by the amount of (A) losses and deductions of the
Company allocated to such Member pursuant to Article IV and (B)
the amount of cash and the
Distribution
Value of any other property distributed to such Member by the Company pursuant
to Article V or
Article
X.
"Capital Contribution"
means a contribution to the capital of the Company.
"Certificate" means
the certificate of formation of LTAC SPV I, LLC, filed with the Secretary of
State of the State of Delaware on February 20, 2008, as amended, modified or
supplemented from time to time.
"Code" means the
Internal Revenue Code of 1986, as amended from time to time (or any succeeding
law).
"Common Sense" has the
meaning set forth in the introductory paragraph.
"Company" means the
limited liability company formed pursuant to the filing of the Certificate and
governed by the terms of this Agreement.
"Distribution Value"
means the Value of a Company asset distributed to a Member by the Company (net
of liabilities secured by such distributed asset that such Member is treated as
assuming or taking subject to).
"Event of Withdrawal"
has the meaning set forth in Section 10.2(a)(i).
"Fiscal Year" has the
meaning set forth in Section 6.3.
"Indemnified Party"
has the meaning set forth in Section 8.6.
"Interest" means the
entire ownership interest of a Member in the Company at any particular time,
including, without limitation, such Member's interest in the capital, profits
and losses of, and in any distributions from, the Company.
"IRS Notice" has the
meaning set forth in Section 9.6.
"LEP" has the meaning
set forth in Section 8.8(c).
"Liquidator" has the
meaning set forth in Section 10.2(b).
"Losses" has the
meaning set forth in Section 8.6.
"Net Income" and
"Net Loss",
respectively, of the Company for any period means the income or loss of the
Company for such period as determined in accordance with the method of
accounting followed by the Company for Federal income tax purposes, including,
for all purposes, any income exempt from tax and any expenditures of the Company
which are described
in
Code section 705(a)(2)(B); provided, however, that in
determining Net Income and Net Loss and every item entering into the computation
thereof, solely for the purpose of adjusting the Capital Accounts of the Members
(and not for tax purposes, which computation shall be determined in accordance
with Section 4.3), (i) any income, gain, loss or deduction attributable to the
taxable disposition of any Company asset shall be computed as if the adjusted
basis of such Company asset on the date of such disposition equaled its book
value as of such date, (ii) if any Company asset is distributed in kind to a
Member, the difference between its fair market value and its book value at the
time of such distribution shall be treated as gain or loss, and (iii) any
depreciation, cost recovery and amortization as to any Company asset shall be
computed by assuming that the adjusted basis of such Company asset equaled its
book value determined under the methodology described in Regulation
§1.704-1(b)(2)(iv)(g)(3); and provided, further, that any
item (computed with the adjustments in the preceding proviso) allocated
under Section 4.2 shall be excluded from the computation of Net Income and
Net Loss.
"Person" means any
individual, partnership, limited liability company, association, corporation,
trust or other entity.
"Portfolio Company
Securities" means the common stock of TransAlta Corporation, a Canadian
corporation, and/or such other securities that the Members may mutually agree
upon.
"Regulation" means a
Treasury Regulation promulgated under the Code.
"Safe Harbor" has the
meaning set forth in Section 9.6.
"Substituted Member"
means any Person admitted to the Company as a substituted Member pursuant to the
provisions of Article
IX.
"Tax Matters Partner"
has the meaning set forth in Section 8.4.
"Transfer," "Transferee" and
"Transferor"
have the respective meanings set forth in Section 9.1.
"Value" of any asset
or liability of the Company as of any date means, with respect to any asset or
liability of the Company, the fair market value of such asset or liability as of
such date as reasonably determined by the Managing Member; provided, however, securities
(other than options on securities, options on indices of securities and
exchange-traded options on currencies) for which market quotations are readily
available will be valued at the last or closing price or, if there is no closing
price, then the mid-point of the bid price and offer price, determined in each
case as from standard sources of financial information such as the Bloomberg
service, Reuters or IDC.
"Void Transfer" has
the meaning set forth in Section 9.1.
"Withdrawing Member"
has the meaning set forth in Section 9.2(d).
ARTICLE
III
CAPITAL
CONTRIBUTIONS
Section
3.1 Capital
Contributions. On or before the date hereof, each of the
Members has made Capital Contributions to the Company in the amounts set forth
on Schedule
A hereto. No Member
shall at any time be required, and no Member shall have any right, to make any
additional Capital Contributions, except as may be required by law, as permitted
by the Managing Member, or as otherwise specified in this
Agreement. All Capital Contributions shall be in cash, except as
permitted by the Managing Member.
Section
3.2 No Interest Paid on Capital
Contribution(s). No Member shall be entitled to interest on or
with respect to such Member's Capital Contribution(s).
Section
3.3 Withdrawal and Return of
Capital Contributions. Except as provided in this Agreement or
unless otherwise agreed upon by the members, no Member shall be entitled to
withdraw any part of such Member's Capital Contribution(s) or receive any
distributions from the Company until the earlier of (i) sale of all or
substantially all of the Portfolio Company Securities, or (ii) 30 months after
the date of this Agreement in either case, upon 60 days prior written notice to
Managing Member.
ARTICLE
IV
ALLOCATION
OF NET INCOME AND NET LOSS
Section
4.1 Allocation of Net Income and
Net Loss. The Members agree to treat the Company as a
partnership and the Members as partners for Federal income tax purposes, not to
elect for the Company to be treated as an association taxable as a corporation
and to file all tax returns accordingly. Except as provided in
Section 4.2, the Company's Net Income or Net Loss, as the case may be, and each
item of income, gain, loss and deduction entering into the computation thereof,
for each Fiscal Year or other period shall be allocated among the
Members so that, after giving effect to such allocations, the Capital
Account of each Member equals the amount that would be distributed to such
Member if (a) all of the Company's assets were sold as of the last day of such
Fiscal Year or such other period, (b) the Company were liquidated and (c) the
proceeds were distributed in accordance with the provisions of Section
10.3 at the end of such Fiscal Year or such other period.
Section
4.2 Other Allocation
Provisions.
(a) The
Members intend that the allocations pursuant to Section 4.1 be equivalent
to allocations that have or are deemed to have "substantial economic effect"
within the meaning of Regulations §§ 1.704-1(b) and 1.704-2, and the Managing
Member shall make such changes in the allocations pursuant to 0 as it determines reasonably necessary to meet the
requirements of such Regulations. The Managing Member shall have the
authority to make subsequent allocations to reverse the effect of any
allocations that are made pursuant to this Section 4.1 to comply with
the Regulations.
(b) Except
to the extent otherwise required by the Code or the Regulations, if an Interest
in the Company or any part thereof is Transferred in any Fiscal Year, the items
of income, gain, loss, deduction and credit allocable to such Interest for such
Fiscal Year shall be apportioned between the Transferor and the Transferee in
proportion to the number of days in such Fiscal Year that such Interest is held
by each of them, except that, if they agree between themselves and so notify the
Company within thirty days after such Transfer, then at their option and
expense, (i) all items or (ii) all extraordinary items, including capital gains
and losses, may be allocated to the Person who held such Interest on the date
such items were realized or incurred by the Company.
Section
4.3 Allocations for Income Tax
Purposes. The income, gains, losses, deductions and credits of
the Company for Federal, state and local income tax purposes shall be allocated
in the same manner as the corresponding items included in the computation of Net
Income and Net Loss were allocated (after taking into account any reallocations)
pursuant to Section 4.1 and Section 4.2, computing Net Income and Net
Loss for this purpose as if the sale described in Section 4.1(a) were
consummated at sales prices equal to such assets respective adjusted bases for
Federal, state and local income tax purposes; provided that solely for Federal,
state and local income and franchise tax purposes and not for book or Capital
Account purposes, income, gain, loss and deduction with respect to property
properly carried on the Company's books at a Value other than its tax basis
shall be allocated in accordance with the requirements of Code
section 704(c) and Regulation § 1.704-3. Notwithstanding
the foregoing, the Managing Member in its reasonable discretion shall make such
allocations solely for tax purposes as may be needed to ensure that allocations
are in accordance with the interests of the Members, within the meaning of the
Code and Regulations.
Section
4.4 Withholding. To
the extent that the Company is required to withhold and pay over any amounts to
any governmental authority with respect to distributions or allocations to any
Member, the amount withheld shall be treated as a distribution to that
Member. In the event of any claimed over-withholding, Members shall
be limited to an action against the applicable jurisdiction and not against the
Company (unless the Company has not yet paid such amounts over to such
jurisdiction). If any amount required to be withheld was not, in
fact, actually withheld from one or more distributions, the Company may
(i) require such Member to reimburse the Company for the corresponding
withholding payments made by the Company or (ii) reduce any subsequent
distributions to such Member by the amount of such withholding
payments. Each Member agrees to furnish the Company with such
documentation as shall reasonably be requested by the Company to assist it in
determining the extent of, and in fulfilling, its withholding
obligations. Each Member will indemnify the Managing Member and the
Company against any losses and liabilities (including interest and penalties)
related to any withholding obligations with respect to allocations or
distributions made to such Member by the Company. At the request of
any Member, the Company will use commercially reasonable efforts to take such
action as is requested to minimize the amount that the Company is required to
withhold with respect to such Member; provided that the foregoing shall not be
deemed to prohibit the Company from making distributions.
ARTICLE
V
DISTRIBUTIONS
Section
5.1 Distributions
Generally. Subject to the provisions of Section 5.2 and
Section 5.3, the Company shall, at such times and in such amounts as determined
by the Managing Member, in its sole discretion, make distributions to the
Members, in cash, as follows:
(a) first,
100% of all distributions shall be paid to the Members pro rata in accordance
with their respective Capital Contributions until each Member has received
cumulative distributions equal to its aggregate Capital Contributions;
and
(b) second,
after the amounts provided for in Section 5.1(a) have been paid in full, any
remaining balance of such distributions and any further distributions shall be
paid as follows: (i) 20% of such balance to the Managing Member and
(ii) 80% of such balance to all of the Members pro rata in accordance with their
respective Capital Contributions.
Section
5.2 Limitations on
Distributions.
(a) Notwithstanding
anything herein to the contrary:
(i) no
distribution shall be made that would violate the Act;
(ii) no
distribution shall be made to any Member if, after giving effect to such
distribution, such Member's Adjusted Capital Account Balance (computed without
regard to reasonably expected adjustments, allocations and distributions
described in Regulation §1.704-1(b)(2)(ii)(d)(4), (5) and (6)) would be
negative;
(iii) no
distribution shall be made that would violate the terms of any agreement or any
other instrument to which the Company is a party; and
(iv) except
as otherwise agreed to in writing by the Members, no distributions pursuant
to Section 5.1(b) shall be made until such time that all Portfolio
Company Securities have been sold by the Company, except that the Managing
Member shall have discretion to make distributions for dividends paid with
respect to Portfolio Company Securities or other income earned by the Company
and to permit Members to pay taxes on such dividends or other income earned by
the Company.
(b) In
the event that, as a result of the application of Section 5.2(a), a distribution
is not made, all amounts not distributed shall continue to be subject to all of
the debts and obligations of the Company. The Company shall make all
such distributions as soon as such distributions are no longer prohibited
pursuant to Section 5.2(a).
Section
5.3 Reserves. The
Managing Member shall be entitled to cause the Company to establish such
reserves as it deems reasonably necessary for any contingent or unforeseen
Company liabilities.
ARTICLE
VI
BOOKS
OF ACCOUNT; RECORDS
AND
REPORTS; FISCAL YEAR
Section
6.1 Books and
Records.
(a) Proper
and complete records and books of account shall be kept by the Company in which
shall be entered fully and accurately all transactions and other matters
relative to the Company's business as are usually entered into records and books
of account maintained by Persons engaged in businesses of a like character,
including the Capital Account established for each Member. The
Company books and records shall be kept in a manner determined by the Managing
Member.
(b) The
books and records shall at all times be maintained at the principal office of
the Company and shall be open to the inspection and examination of the Members
or their duly authorized representatives during reasonable business hours and at
the sole cost and expense of the inspecting or examining Member upon reasonable
notice to the Managing Member. The Company shall maintain at its
principal office and make available to any Member or any designated
representative of any Member a list of names and addresses of all
Members.
Section
6.2 Reports. Within
75 days after the end of each Fiscal Year or as soon thereafter as is reasonably
possible, the Company shall prepare and deliver to each Person who was a Member
at any time during such Fiscal Year a report setting forth in sufficient detail
such information as shall enable such Person to prepare its Federal income tax
returns in accordance with the laws, rules and regulations then
prevailing.
Section
6.3 Fiscal
Year. The fiscal year of the Company (the "Fiscal Year") shall
be the calendar year; provided that the last Fiscal Year of the Company shall
end on the date on which the Company is terminated.
ARTICLE
VII
POWERS,
RIGHTS AND DUTIES OF THE MEMBERS
Section
7.1 Limitations. Except
as otherwise set forth in this Agreement, no Member other than the Managing
Member shall (a) participate in the management or control of the Company's
business, (b) transact any business for the Company or (c) have the
power to act for or bind the Company, all of the foregoing powers being vested
solely and exclusively in the Managing Member.
Section
7.2 Liability. Except
as otherwise provided by the Act and without limiting the express terms hereof,
no Member shall be liable for the repayment, satisfaction or discharge of any
liabilities of the Company in excess of the balance of such Member's Capital
Account. Without limiting the express terms hereof, no Member shall
be personally liable for the return of any portion of the Capital
Contribution(s) (or any profits thereon) of any other Member.
Section
7.3 Priority. Except
as otherwise set forth in this Agreement, no Member shall have priority over any
other Member as to Company property, allocations or distributions.
Section
7.4 Restriction on
Acquisition. Each Member other than the Managing Member agrees
that neither it nor any of its controlled affiliates will, without the prior
written consent of the Managing Member, purchase or acquire any economic
interest in the Portfolio Company Securities except through the
Company.
Section
7.5 No Limitation on Managing
Member. Each Member acknowledges that the Managing Member
currently has a significant position in the Portfolio Company Securities and
that nothing in this Agreement may restrict or prohibit the Managing Member from
taking any action with respect to such Portfolio Company Securities, except as
expressly set forth in this Agreement.
ARTICLE
VIII
POWERS,
RIGHTS AND DUTIES OF THE MANAGING MEMBER
Section
8.1 Authority, Power and Duties of the
Managing Member
(a) Subject
to the limitations provided in this Agreement, the Managing Member shall have
exclusive and complete authority and discretion to manage the operations and
affairs of the Company and to make all decisions regarding the business of the
Company, including, without limitation, the power to carry out any and all of
the objects and purposes of the Company set forth in Section 1.3 of this
Agreement; to perform all acts and enter into and perform all contracts and
other undertakings that it may deem
necessary
or advisable or incidental thereto; to engage in such other lawful transactions
with respect to the Portfolio Company Securities as the Managing Member may from
time to time determine; and to possess, transfer, mortgage, pledge or otherwise
deal in, and exercise all rights, powers, privileges and other incidents of
ownership or possession (including voting, consent and similar rights) with
respect to, the Portfolio Company Securities, other assets and funds held or
owned by the Company. The Managing Member may appoint, employ, or
otherwise contract with persons for the transaction of the business of the
Company or the performance of services for or on behalf of the Company,
including without limitation the appointment or removal of officers and
directors, as it shall determine in its sole discretion.
(b) Any
action taken by the Managing Member shall constitute the act of and be binding
upon the Company. In dealing with the Managing Member acting on
behalf of the Company, no Person shall be required to inquire into the authority
of the Managing Member to bind the Company. Persons dealing with the
Company are entitled to rely conclusively on the power and authority of the
Managing Member as set forth in this Agreement.
(c) The
Managing Member may appoint, employ, or otherwise contract with persons for the
transaction of the business of the Company or the performance of services for or
on behalf of the Company as it shall determine in its sole
discretion. The officers of the Company shall be elected, removed,
have such titles and perform such functions, as determined by the Managing
Member in its sole discretion. The Managing Member may delegate to
any officer of the Company or to any such other person such authority to act on
behalf of the Company as the Managing Member may from time to time deem
appropriate in its sole discretion.
Section
8.2 Company
Funds. Company funds shall be held in the name of the Company
and shall not be commingled with those of any other Person. Company
funds shall be used only for the business of the Company.
Section
8.3 Limits on Managing Member's
Powers. The Managing Member may not, without the written
consent of or ratification of the specific act by all of the
Members:
(a) invest
the assets of the Company other than in Portfolio Company Securities, cash and
cash-equivalents and any currency hedge instruments;
(b) incur
indebtedness or take property subject to indebtedness;
(c) possess
or assign Company property other than for a Company purpose; or
(d) knowingly
perform any act that would subject any Member to liability as a general partner
in any jurisdiction.
Section
8.4 Tax Matters
Partner. For purposes of Code section 6231(a)(7), the "Tax
Matters Partner" shall be the Managing Member of the Company. The Tax
Matters Partner is specifically directed and authorized to take whatever steps
may be necessary or desirable to perfect such designation, including filing any
forms or documents with the Internal Revenue Service and taking such other
action as may from time to time be required under the Regulations.
Section
8.5 Exculpation; Modification of
Duties.
(a) No
Member shall be personally liable for the return of any portion of the Capital
Contributions (or any return thereon) of any other Member. The return
of such Capital Contributions (or any return thereon) shall be made solely from
the Company's assets. No Member shall be required to pay to the
Company or to any other Member any deficit in the Capital Account of any Member
upon dissolution of the Company or otherwise. No Member shall have
the right to demand or receive property other than cash for his or her Interest
in the Company.
(b) No
Member nor any affiliate of any Member shall be liable, responsible or
accountable in damages or otherwise to the Company or any other Member for any
act or failure to act on behalf of the Company taken in good faith unless such
loss resulted from such Person's fraud, bad faith, gross negligence or willful
misconduct. Notwithstanding anything to the contrary in this
Agreement, to the extent that, at law or in equity, an Indemnified Party has
duties (including fiduciary duties) and liabilities relating thereto to the
Company, any Member or any other Person, such Indemnified Party acting under
this Agreement shall not be liable to the Company, any Member or any other
Person for breach of fiduciary duty for its good faith reliance on the
provisions of this Agreement, and the provisions of this Agreement, to the
extent that they restrict or eliminate the duties (including fiduciary duties)
and liability of an Indemnified Party otherwise existing at law or in equity,
are agreed by the Company and each Member to replace such other duties and
liabilities of such Indemnified Party.
Section
8.6 Exculpation and
Indemnification of the Members.
(a) To
the fullest extent permitted by applicable law, the Company agrees that none of
(i) the Members (including the Managing Member), any service providers, and the
affiliates of any of them, (ii) the officers, directors, members, principals,
shareholders, controlling persons, representatives, partners, managers,
employees, agents, affiliates and assigns of any person in item (i) above, and
(iii) any employee, officer and agent of the Company (each, an "Indemnified Party")
shall be liable to the Company, or to any Member, for any loss, cost, expense,
claims, judgment, damages, settlement cost, fee and related expenses (including
attorneys' fees and expenses) ("Losses") arising from
any act or omission performed or omitted by it in connection with this Agreement
or the Company's business or affairs except for any such Losses determined by
final judgment of a court of competent jurisdiction to have been primarily
attributable to such Indemnified Party's (i) gross negligence (as determined in
accordance with the laws of the State of Delaware), recklessness or willful
misconduct or (ii) bad faith of such Indemnified Party. Neither shall
an Indemnified Party be liable to the Company, or to any Member, for any losses
due to any act of any broker or agent of the Company; provided, that the
selection, engagement or retention of such broker or agent by the Indemnified
Party did not constitute gross negligence (as defined by the laws of the State
of Delaware), recklessness, willful misconduct or bad faith on the part of the
Indemnified Party. An Indemnified Party may consult with counsel and
accountants and will be fully protected and justified in any action or inaction
which is taken in accordance with the advice or opinion of such counsel or
accountants; provided, that they were selected in accordance with the standard
of care set forth above.
(b) The
Company (except as otherwise provided in this Agreement), out of its own assets
and not out of the assets of any Member, shall, to the fullest extent permitted
by applicable law, indemnify and hold harmless each Indemnified Party against
any Losses sustained by an Indemnified Party arising from any act or omission
performed or omitted by it in connection with any matter arising out of or in
connection with this Agreement or the Company's business or affairs, except for
any such Losses determined by final judgment of a court of competent
jurisdiction to have been primarily attributable to such Indemnified
Party's (i) gross negligence (as determined in accordance with the
laws of the State of Delaware), recklessness or willful misconduct or (ii) bad
faith of such Indemnified Party, or due to any act of any broker or agent of the
Company or the Master Company; provided, that the selection, engagement or
retention of such broker or agent by the Indemnified Party did not constitute
gross negligence (as defined by the laws of the State of Delaware),
recklessness, willful misconduct or bad faith on the part of the Indemnified
Party. The Company shall, (i) in the discretion of the Managing Member, advance
to each Indemnified Party, or (ii) promptly reimburse each Indemnified Party
for, all expenses (including fees and expenses of counsel) incurred in
connection with investigating, preparing, pursuing or defending any proceeding
related to, arising out of or in connection with this Agreement or the Company's
business or affairs; provided that such Indemnified Party shall promptly repay
to the Company the amount of any such advanced or reimbursed expenses paid to it
if it shall be judicially determined by judgment or order not subject to further
appeal or discretionary review that such Indemnified Party is not entitled to be
indemnified under the terms of this Agreement. If for any reason (other than
such Indemnified Party's (i) gross negligence (as determined in accordance with
the laws of the State of Delaware), recklessness or willful misconduct or (ii)
bad faith of such Indemnified Party) the foregoing indemnification is
unavailable to any Indemnified Party, or insufficient to hold it harmless, then
the Company shall contribute to the amount paid or payable by such Indemnified
Party as a result of such loss, claim, damage, liability or expense in such
proportion as is appropriate to reflect the relative benefits received by the
Company, on the one hand, and such Indemnified Party on the other hand or, if
such allocation is not permitted by applicable law, to reflect not only the
relative benefits referred to above but also any other relevant equitable
considerations.
Section
8.7 Expenses. The
Company shall pay all expenses incurred in connection with the operation and
establishment of the Company, including fees paid to counsel and any other third
parties. The Company shall reimburse any Member for any such expenses
advanced by such Member on behalf of the Company. The Managing Member shall not
be compensated for managing the business of the Company.
Section
8.8 Activities of Managing
Member; Conflicts of Interest. The Managing Member, its
officers, directors, employees or their respective agents shall not be obligated
to do or perform any act or thing in connection with the business of the Company
not expressly set forth herein. Notwithstanding anything to the
contrary in this Agreement, the officers, directors, managers and employees of
the Managing Member and any person controlling, under common control with or
controlled by the Managing Member will be permitted to perform similar duties
for any entity and shall not, by reason
of
such performance be deemed to be acting in conflict with the interests of the
Company.
(a) Nothing
herein contained shall be deemed to preclude the Managing Member, its officers,
directors, managers, employees or other respective agents from engaging directly
or indirectly in any other business or from directly or indirectly purchasing,
selling or holding securities, options, separate accounts, investment contracts,
commodities, futures, currencies, currency units and forward currency or
currency unit contracts or any other asset (including, but not limited to, the
Portfolio Company Securities) and any interests therein for their own accounts
or for the account of any other person, whether as Managing Member, investment
adviser or otherwise. No Member shall, by reason of being a Member of
the Company, have any right to participate in any manner in any profits or
income earned or derived by or accruing to the Managing Member, or its officers,
directors, employees or other respective agents, from the conduct of any
businesses, activities or accounts other than as provided herein.
(b) Notwithstanding
the foregoing, the Managing Member shall resolve any conflicts of interest and
allocation of investment opportunities among the Company and other accounts it
manages in a fair and reasonable manner. The Managing Member may give
advice and take action with respect to other accounts it manages that may differ
from advice given or the timing or nature of action taken with respect to the
Company, so long as it is the Managing Member's policy, to the extent
practicable, to allocate investment opportunities to the Company over a period
of time on a fair and equitable basis relative to other accounts.
(c) The
Managing Member may aggregate financial instruments sale and purchase orders for
the Company with similar orders being made contemporaneously for other accounts
managed by the Managing Member or its affiliates if, in the Managing Member's
reasonable judgment, such aggregation is reasonably likely to result in overall
economic benefit to the Company, based on an evaluation that the Company is
benefited by relatively better purchase or sale prices, lower commissions
expenses or beneficial timing of transactions, or a combination of these and
other factors. Contemporaneous transactions may be made at slightly
different prices, due to the volume of financial instruments purchased or
sold. In such event, the average price of all financial instruments
purchased or sold in such transactions may be determined, and the Company may be
charged or credited, as the case may be, the average transaction
price. If Luminus Energy Partners Master Fund, Ltd. ("LEP") sells a
substantial portion of its Portfolio Company Securities in any one trade or a
series of related trades, then the Managing Member shall, at its election,
either (i) notify Common Sense, and if Common Sense determines that it would
like to sell down the Portfolio Company Securities as well, the Managing Member
shall use its best efforts to effect a substantially pro-rata sell down of such
Portfolio Company Securities at the same time as LEP's sale or related series of
sales or (ii) use its best efforts to sell down the Portfolio Company Securities
on a substantially pro-rata basis, without having to notify Common Sense prior
to such sell down; provided, however, and for the
avoidance of doubt, notwithstanding the foregoing, in no event shall "best
efforts" mean Common Sense shall be entitled to the same or better price in the
sale of such Portfolio Company Securities.
Section
8.9 Removal and Replacement of
the Managing Member. The Managing Member may not be removed by
the Members, but the Managing Member shall have the authority to appoint
additional, replacement, or substitute Managing Members subject to Article IX. Subject to
Article IX, if the Managing
Member resigns and does not appoint a replacement Managing Member within 10
days, the Members may appoint a new Managing Member.
ARTICLE
IX
TRANSFERS
Section
9.1 Transfers
Generally. No
Member may sell, assign, pledge or in any manner dispose of or create or suffer
the creation of, a security interest in or any encumbrance on all or a portion
of its Interest (the commission of any such act being referred to as a "Transfer", any Person who effects a
Transfer being referred to as a "Transferor" and any Person to whom a Transfer
is effected being referred to as a "Transferee"), except in accordance
with the terms and conditions set forth in this Article IX. No Transfer of
an Interest shall be effective until such time as all requirements of this Article IX in respect
thereof have been satisfied and, if consents, approvals or waivers are required
by the Managing Member, all of which shall have been confirmed in writing by the
Managing Member. Any Transfer or purported Transfer of an Interest
not made in accordance with this Agreement (a "Void Transfer") shall be null and void
and of no force or effect whatsoever. Any amounts otherwise
distributable under Article V in
respect of an Interest that has been the subject of a Void Transfer may be
withheld by the Company until the Void Transfer has been rescinded, whereupon
the amount withheld shall be distributed without interest.
Section
9.2 Transfers of Interests of
Members.
(a) No
Member may Transfer all or any portion of his or her Interest to any Person
without the prior written consent of the Managing Member, which consent may be
granted or withheld in the sole discretion of the Managing Member; provided,
however, that the total number of Members shall not exceed 99.
(b) The
Transferee of a Member's Interest may be admitted to the Company as a
Substituted Member only upon the prior written consent of the other Members,
which consent may be granted or withheld in their sole discretion. No
Transferee of the Managing Member shall have any of the rights or powers of the
Managing Member hereunder without the consent of the other
Members. Unless a Transferee of a Member's Interest is admitted as a
Substituted Member pursuant to this Section 9.2(b), it shall have none of the
powers of a Member hereunder and shall only have such rights of an assignee
under the Act as are consistent with the other terms and provisions of this
Agreement.
(c) Upon
the Transfer of the entire Interest of a Member and effective upon the admission
of its Transferee as a Member, the Transferor shall be deemed to have withdrawn
from the Company as a Member.
(d) Upon
the death, disability, incompetency, dissolution, termination, withdrawal in
contravention of Section 10.1, the assignment for the benefit of creditors or
the bankruptcy of a Member (the "Withdrawing Member"),
the Company shall have the right to treat such Member's successor(s)-in-interest
as assignee(s) of such Member's Interest, with none of the powers of a Member
hereunder and with only such rights of an assignee under the Act as
are
consistent
with this Agreement. For purposes of this Section 9.2(d), if a
Withdrawing Member's Interest is held by more than one Person (for purposes of
this subparagraph
(d)),
the "Assignees"), the
Assignees shall appoint one Person with full authority to accept notices and
distributions with respect to such Interest on behalf of the Assignees and to
bind them with respect to all matters in connection with the Company or this
Agreement.
(e) The
Company shall reflect each Transfer and admission authorized under this Article IX by
preparing an amendment to this Agreement, dated as of the date of such Transfer,
to reflect such Transfer or admission.
Section
9.3 Consequences of
Transfers.
(a) In
the event of any Transfer permitted under this Article IX, the
Transferor and the Interest that is the subject of such Transfer shall remain
subject to all of the terms and provisions of this Agreement, and the Transferee
shall hold such Interest subject to all unperformed obligations of the
Transferor and shall agree in writing to the foregoing if requested to do so by
the Managing Member. Any successor or Transferee hereunder shall be
subject to and bound by all the terms and provisions of this Agreement as if a
Member originally a party to this Agreement.
(b) Unless
a Transferee becomes a Substituted Member, such Transferee shall have no right
to obtain or require any information concerning, or any account of, Company
transactions, or to inspect the Company's books, or to vote on Company
matters. Such a Transfer shall, subject to the last sentence of
Section 9.1, entitle the Transferee only to receive the share of distributions,
income and losses to which the transferring Member otherwise would be
entitled. Each Member agrees that such Member will, upon request of
the Managing Member, execute such certificates or other documents and perform
such other acts as the Managing Member may deem necessary or advisable after a
Transfer of all or part of that Member's Interest (whether or not the Transferee
becomes a Substituted Member) to preserve the limited liability of the Members
under the laws of the jurisdictions in which the Company is doing
business.
(c) Neither
the Transfer of an Interest nor the admission of a Substituted Member shall be
cause for dissolution of the Company.
Section
9.4 Transferee to Succeed to
Transferor's Capital Account. Any Transferee pursuant to the
provisions of this Article IX shall succeed to the
Capital Account so Transferred to such Transferee.
Section
9.5 Additional
Filings. Upon acceptance of a Transferee for admission as a
Substituted Member under Section 9.2 or Section 9.3, the Managing Member shall
cause to be executed, filed and recorded with the appropriate governmental
agencies such documents (including amendments to this Agreement, if necessary)
as are required to accomplish such admission.
Section
9.6 Safe Harbor Election in
Connection with Certain Transfers. By executing this
Agreement, each Member authorizes and directs the Company to elect to have the
"Safe Harbor" (the "Safe Harbor") described in the proposed Revenue Procedure
set forth in Internal Revenue Service Notice 2005-43 (the "IRS Notice") apply to
any interest in the Company transferred to a service provider by the Company on
or after the effective date of such Revenue Procedure in connection with
services provided to the
Company
provided, however the Company shall make such election only in the manner such
Safe Harbor is set forth in any final Revenue Procedure and only if the final
Revenue Procedure does not impose conditions that, in the reasonable discretion
of the Managing Member are materially more onerous to the Members (including,
for the avoidance of doubt, the Managing Member) than those in the IRS
Notice. For purposes of making such Safe Harbor election, the
Managing Member is hereby designated as the "partner who has responsibility for
Federal income tax reporting" by the Company and, accordingly, execution of such
Safe Harbor election by the Managing Member constitutes execution of a "Safe
Harbor Election" in accordance with Section 3.03(1) of the IRS
Notice. The Company and each Member hereby agree to comply with all
requirements of the Safe Harbor described in the IRS Notice (as it becomes
finally effective), including, without limitation, the requirement that each
Member shall prepare and file all federal income tax returns reporting the
income tax effects of each Safe Harbor interest issued by the Company in a
manner consistent with the requirements of the IRS Notice (as it becomes
effective). A Member's obligations to comply with the requirements of
this Section 9.6 shall survive such Member's ceasing to be a Member in
the Company and/or the termination, dissolution, liquidation and winding up of
the Company, and, for purposes of this Section 9.6, the Company shall be treated
as continuing in existence.
ARTICLE
X
WITHDRAWAL
OF MEMBERS; TERMINATION OF THE COMPANY;
LIQUIDATION
AND DISTRIBUTION OF ASSETS
Section
10.1 Withdrawal of
Members. Except as otherwise provided in this Agreement, no
Member shall at any time resign, retire or withdraw from the Company as a Member
before the earlier of (i) sale of all or substantially all of the Portfolio
Company Securities, or (ii) 30 months after the date of this Agreement, in
either case, upon 60 days' prior written notice.
Section
10.2 Dissolution of the
Company.
(a) The
Company shall be dissolved, wound up and terminated as provided herein upon the
first to occur of the following:
(i) the
withdrawal (only as permitted in this Agreement and other than pursuant to a
permitted Transfer), death, disability or bankruptcy of a Member (an "Event of
Withdrawal");
(ii) the
determination of the Managing Member, in its sole discretion, at any
time;
(iii) a
decree of dissolution of the Court of Chancery of the State of Delaware pursuant
to 18-801 of the Act;
(iv) the
occurrence of any other event that would make it unlawful for the business of
the Company to be continued; and
(v) liquidation
by the Company of all or substantially all of the Portfolio Company
Securities.
(b) In
the event of the dissolution of the Company, the Managing Member or, if an Event
of Withdrawal shall have occurred with respect to the Managing Member, a
liquidating agent appointed by the remaining Members (the Managing Member or
such liquidating agent, the "Liquidator"), shall
commence to wind up the affairs of the Company and to liquidate the Company's
assets. The Members shall continue to share all income, losses and
distributions of the Company during the period of liquidation in accordance with
Articles IV and
V.
(c) Subject
to (d), the Liquidator (i) shall have full right and unlimited discretion to
determine the time, manner and terms of any sale or sales of Company assets
pursuant to such liquidation, (ii) shall have all of the rights and powers with
respect to the assets and liabilities of the Company in connection with the
liquidation and termination of the Company that the Managing Member would have
with respect to the assets and liabilities of the Company during the term of the
Company and (iii) is hereby expressly authorized and empowered to execute any
and all documents necessary or desirable to effectuate the liquidation and
termination of the Company and the transfer of any assets.
(d) A
Liquidator that is not the Managing Member shall (i) not be deemed a Member in
this Company and shall not have any of the economic interests in the Company of
a Member and (ii) be compensated for its services to the Company at normal,
customary and competitive rates for its services to the Company as reasonably
determined by the remaining Members.
Section
10.3 Distribution in
Liquidation.
(a) The
Liquidator shall, as soon as practicable following an event giving rise to the
dissolution, winding up and termination of the Company, wind up the affairs of
the Company and sell and/or distribute the assets of the Company; provided,
however, under no circumstances shall any sale of assets and distribution of
proceeds pursuant to liquidation take place more than 90 days after an Event of
Withdrawal. The assets of the Company shall be applied in the
following order of priority:
(i) first,
to pay the costs and expenses of the dissolution, winding up and termination of
the Company;
(ii) second,
to creditors of the Company, in the order of priority provided by law, such
payments to include all fees and reimbursements payable to the Members or their
affiliates, but not those liabilities to the Members in their capacity as
Members (other than liabilities to the Members for any expenses of the Company
paid by the Members or their affiliates, to the extent the Members are entitled
to reimbursement hereunder);
(iii) third,
to establish reserves reasonably adequate to meet any and all contingent or
unforeseen liabilities or obligations of the Company; provided, however, that all or
part of the balance of such reserves shall be distributed as hereinafter
provided from time to time as the Liquidator may deem appropriate in view of the
satisfaction, elimination or reduction of such contingencies and obligations and
the reserves deemed prudent by the Liquidator to cover unforeseen
liabilities;
(iv) fourth,
to the Members for loans, if any, made by them to the Company; and
(v) fifth,
to the Members in accordance with Section
5.1.
(b) If
the Liquidator determines that Company assets other than cash are to be
distributed then the Value of such assets shall be determined. Any
such assets shall be retained or distributed by the Liquidator as
follows:
(i) The
Liquidator shall retain assets belonging to the Company having a Value (net of
associated liabilities) equal to the amount by which the net proceeds of the
Company's assets are insufficient to satisfy the requirements of paragraphs (i),
(ii) and (iii) of Section 10.3(a);
and
(ii) The
remaining assets belonging to the Company shall be distributed to the Members in
the manner specified in paragraphs
(iv) and (v) of Section 10.3(a)
in accordance with the net fair market value of any such assets.
The
Liquidator shall distribute to each Member its allocable share of each asset
belonging to the Company which is distributed in kind unless all Members
otherwise agree. Any distributions in kind shall be subject to such
conditions relating to the disposition and management thereof as the Liquidator
deems reasonable and equitable.
Section
10.4 Final Statement of Assets
and Liabilities. Within a reasonable time following the
completion of the liquidation of the Company's assets, the Liquidator shall
deliver to each of the Members a statement which shall set forth the assets and
liabilities of the Company as of the date of complete liquidation and the
distributions due or made to each Member from the Company pursuant to Section
10.3.
Section
10.5 No Deficit Restoration
Obligation. No Member shall have any liability to restore any
deficit in its Capital Account, whether upon liquidation of the Company or
otherwise. In addition, no allocation to any Member of any loss shall
create any asset of or obligation to the Company, even if such allocation
creates or increases a deficit in such Member's Capital Account; and no Member
shall be obligated to pay the amount of any such deficit to or for the account
of the Company or any creditor of the Company. The obligations of any
Member to make Capital Contributions are for the exclusive benefit of the
Company and not of any creditor of the Company.
Section
10.6 Termination of the
Company. The Company shall terminate when all property owned
by the Company shall have been disposed of and the assets of the Company shall
have been distributed as provided in Section 10.6. The Liquidator
shall then execute and cause to be filed a Certificate of Cancellation of the
Company.
ARTICLE
XI
ADMISSION
OF ADDITIONAL MEMBERS
Section
11.1 Admission of Additional
Members. Additional Persons shall be admitted as Members only
with the consent of the Managing Member and the existing Members, for such
Capital Contribution as the Managing Member and the existing Members may
determine.
ARTICLE
XII
NOTICES
AND VOTING
Section
12.1 Notices. All
notices, demands or requests required or permitted under this Agreement must be
in writing, and shall be made by hand delivery, certified mail, overnight
courier service or facsimile to the address or fax number set forth below such
Member's name on the signature page hereto, but any party may designate a
different address or facsimile number by a notice similarly given to each
Member. Any such notice or communication shall be deemed given when
delivered by hand, if delivered on a Business Day, the next Business Day after
delivery by hand if delivered by hand on a day that is not a Business Day; five
Business Days after being deposited in the United States mail, postage prepaid,
return receipt requested, if mailed; on the next Business Day after being
deposited for next day delivery with Federal Express or a similar overnight
courier; when receipt is acknowledged, if faxed on a Business Day and the next
Business Day following the day on which receipt is acknowledged if faxed on a
day that is not a Business Day.
Section
12.2 Voting. Any
action requiring the affirmative vote of the Members under this Agreement may
only, unless otherwise specified herein, be taken by a unanimous vote at a
meeting or, in lieu thereof, by unanimous written consent of all Members'
Interest.
ARTICLE
XIII
AMENDMENT
OF AGREEMENT
Section
13.1 Amendments.
(a) Amendments
to this Agreement which do not adversely affect the rights of any Member in any
material respect may be made by the Managing Member without the consent of any
other Member through use of the Power of Attorney; provided that, unless
otherwise specifically contemplated by this Agreement, no amendment to this
Agreement shall (x) without the consent of all Members, change or alter this
Section 13.1, or (y) without the consent of each of the Members adversely
affected thereby, increase the liability of any Member, decrease any Member's
allocable share of income or its rights to distributions (and the timing
thereof) or increase any Member's allocable share of losses, in each case other
than on a pro rata
basis as provided herein or as otherwise provided herein. The
Managing Member shall send to each Member a copy of any amendment executed by
the Managing Member pursuant to the Power of Attorney.
(b) Any
amendment to this Agreement, except as otherwise contemplated by Section
13.1(a), shall require a unanimous vote of the Members.
Section
13.2 Amendment of
Certificate. In the event that this Agreement is amended
pursuant to this Article XIII, the Managing Member
shall, to the extent that the Managing Member deems necessary or advisable,
amend the Certificate to reflect such change.
Section
13.3 Power of
Attorney. Each Member hereby irrevocably constitutes and
appoints the Managing Member as its true and lawful attorney-in-fact, with full
power of substitution, in its name, place and stead to make, execute, sign,
acknowledge (including swearing to), verify, deliver, record and file, on its
behalf, the following: (i) an amendment to
this
Agreement which complies with the provisions of this Agreement; (ii) the
Certificate and any amendment thereof required because this Agreement is
amended, including, without limitation, an amendment to effectuate any change in
the membership of the Company; (iii) any application, certificate,
certification, report or similar instrument or document required to be submitted
by or on behalf of the Company to any governmental or administrative agency or
body, to any exchange, board of trade, clearing corporation or association or
similar institution or to any self-regulatory organization or trade association;
(iv) all such other instruments, documents and certificates which, in the
opinion of legal counsel retained by the Managing Member, may from time to time
be required by the laws of the United States of America, the State of Delaware
or any other state in which the Company shall determine to do business, or any
political subdivision or agency thereof, or which such legal counsel may deem
necessary or appropriate to effectuate, implement and continue the valid and
subsisting existence and business of the Company as a limited liability company
and (v) a Certificate of Cancellation of the Company and such other instruments,
and any amendments thereto, as may be deemed necessary or desirable by the
holder of such power upon the termination of the Company. Each Member
is aware that the terms of this Agreement permit certain amendments to this
Agreement to be effected and certain other actions to be taken or omitted by or
with respect to the Company without such Member's consent. If an
amendment of the Certificate or this Agreement or any action by or with respect
to the Company is taken by the Managing Member in the manner contemplated by
this Agreement, each Member agrees that, notwithstanding any objection which
such Member may assert with respect to such action, the special attorneys
specified above are authorized and empowered, with full power of substitution,
to exercise the authority granted above in any manner which may be necessary or
appropriate to permit such amendment to be made or action lawfully taken or
omitted. Each Member is fully aware that each Member will rely on the
effectiveness of this special power-of-attorney with a view to the orderly
administration of the affairs of the Company. This power-of-attorney is a special
power-of-attorney and is coupled with an interest in favor of the
Managing Member and as such (i) shall be irrevocable and continue in full force
and effect notwithstanding the subsequent death or incapacity of any party
granting this power-of-attorney, regardless of whether the Company or the
Managing Member shall have had notice thereof; (ii) may be exercised for a
Member by a facsimile signature of the Managing Member or, after listing all of
the Members, including such Member, by a single signature of the Managing Member
acting as attorney-in-fact for all of them; and (iii) shall survive the delivery
of an assignment by a Member of the whole or any portion of his or its Interest
in the Company, except that where the assignee thereof has been admitted to the
Company as a Substituted Member, this power-of-attorney given by the assignor
shall survive the delivery of such assignment for the sole purpose of enabling
the Managing Member to execute, acknowledge, and file any instrument necessary
to effect such substitution.
ARTICLE
XIV
MISCELLANEOUS
Section
14.1 Entire
Agreement. This Agreement (and schedules) constitutes the
entire agreement among the Members with respect to the subject matter
hereof. The foregoing supersedes any prior agreements or
understandings among the Members with respect to the subject matter hereof, and
the foregoing may not be modified or amended in any manner other than as set
forth herein or therein.
Section
14.2 Applicable
Law. This Agreement and the rights of the parties hereunder
shall be governed by and interpreted in accordance with the law of the State of
Delaware.
Section
14.3 Effect. Except
as herein otherwise specifically provided, this Agreement shall be binding upon
and inure to the benefit of the parties hereto, the Persons indemnified
hereunder and their legal representatives, heirs, successors and permitted
assigns.
Section
14.4 Survival. The
indemnity provisions hereof shall survive the termination of this Agreement and
the dissolution of the Company, as shall the obligation to settle accounts
hereunder.
Section
14.5 Pronouns and
Number. Wherever from the context it appears appropriate, each
term stated in either the singular or the plural shall include the singular and
the plural, and pronouns stated in any of the masculine, feminine or neuter
shall include the masculine, feminine and neuter.
Section
14.6 Captions. Captions
contained in this Agreement are inserted only as a matter of convenience and in
no way define, limit or extend the scope or intent of this Agreement or any
provision hereof.
Section
14.7 Partial
Enforceability. If any provision of this Agreement, or the
application of such provision to any Person or circumstance, shall be held
invalid, the remainder of this Agreement, or the application of such provision
to persons or circumstances other than those to which it is held invalid, shall
not be affected thereby.
Section
14.8 Counterparts. This
Agreement may contain more than one counterpart of the signature page and this
Agreement may be executed by the affixing of the signatures of each of the
Members to one of such counterpart signature pages. All of such
counterpart signatures pages shall be read as though one, and they shall have
the same force and effect as though all of the signers had signed a single
signature page.
Section
14.9 No Third Party
Beneficiaries. The provisions of this Agreement are not
intended to be for the benefit of any creditor (other than a Member who is a
creditor and then only in its capacity as a Member) or other Person (other than
a Member (and only in its capacity as a Member)) to whom any debts, liabilities
or obligations are owed by (or who otherwise has any claim against) the Company
or any of the Members. Moreover, notwithstanding anything contained
in this Agreement, no such creditor or other Person shall obtain any rights
under this Agreement or shall, by reason of this Agreement, make any claim in
respect of any debt, liability or obligation (or otherwise) against the Company
or any Member.
IN
WITNESS WHEREOF, each of the undersigned has executed this Agreement as of the
date first above written
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▇▇▇▇
ENERGY GP, LLC
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||||
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By:
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/s/
▇▇▇▇ ▇▇▇▇▇
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|||
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Name:
|
▇▇▇▇
▇▇▇▇▇
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|||
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Title:
|
President
|
|||
|
▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
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||||
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COMMON
SENSE SPECIAL OPPORTUNITY, LP
|
||||
|
By:
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Common
Sense Investment Management, LLC
|
|||
|
Its:
|
General
Partner
|
|||
|
By:
|
/s/
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
|
|||
|
Name:
|
▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇
|
|||
|
Title:
|
CFO
& General Counsel
|
|||
|
▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
|
||||
Schedule
A
Capital Contributions of
Members
|
Member
|
Capital
Contribution
|
|
▇▇▇▇
Energy GP, LLC
|
$1
|
|
Common
Sense Special Opportunity, LP
|
$999
|