Exhibit 3.2
CONFORMED COPY
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AMENDED AND RESTATED OPERATING AGREEMENT
OF
▇▇▇▇▇▇ OFFSHORE LLC
dated as of December 16, 1997
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TABLE OF CONTENTS
Page
"ARTICLE 1
DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
ARTICLE 2
FORMATION AND OFFICES. . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.1 Formation . . . . . . . . . . . . . . . . . . . . . . . . 11
2.2 Principal Office. . . . . . . . . . . . . . . . . . . . . 11
2.3 Registered Office and Registered Agent. . . . . . . . . . 11
2.4 Purpose of Company. . . . . . . . . . . . . . . . . . . . 11
2.5 Date of Dissolution . . . . . . . . . . . . . . . . . . . 11
2.6 Qualification . . . . . . . . . . . . . . . . . . . . . . 12
ARTICLE 3
CAPITALIZATION OF THE COMPANY. . . . . . . . . . . . . . . . . . . . . . 12
3.1 Certain Additional and Initial Capital Contributions. . . 12
3.2 Additional Capital Contributions. . . . . . . . . . . . . 12
3.3 Loans . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.4 Maintenance of Capital Accounts.. . . . . . . . . . . . . 14
3.5 Capital Withdrawal Rights, Interest and Priority. . . . . 15
3.6 Preemptive Rights . . . . . . . . . . . . . . . . . . . . 15
3.7 Certain SEACOR Transactions . . . . . . . . . . . . . . . 17
ARTICLE 4
DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4.1 Distributions of Net Cash Flow. . . . . . . . . . . . . . 18
4.2 Persons Entitled to Distributions . . . . . . . . . . . . 18
4.3 Limitations on Distributions. . . . . . . . . . . . . . . 19
ARTICLE 5
ALLOCATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
5.1 Profits . . . . . . . . . . . . . . . . . . . . . . . . . 19
5.2 Losses. . . . . . . . . . . . . . . . . . . . . . . . . . 19
5.3 Special Allocations . . . . . . . . . . . . . . . . . . . 19
5.4 Curative Allocations. . . . . . . . . . . . . . . . . . . 21
5.5 Loss Limitation . . . . . . . . . . . . . . . . . . . . . 21
5.6 Tax Allocations: Code Section 704(c) . . . . . . . . . . 22
5.7 Change in Percentage Interests. . . . . . . . . . . . . . 23
5.8 Withholding . . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE 6
MEMBERS' MEETINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
6.1 Meetings of Members; Place of Meetings. . . . . . . . . . 23
6.2 Quorum; Voting Requirement. . . . . . . . . . . . . . . . 24
6.3 Proxies . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.4 Action Without Meeting. . . . . . . . . . . . . . . . . . 24
6.5 Notice. . . . . . . . . . . . . . . . . . . . . . . . . . 24
6.6 Waiver of Notice. . . . . . . . . . . . . . . . . . . . . 24
6.7 No Authority. . . . . . . . . . . . . . . . . . . . . . . 25
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ARTICLE 7
MANAGEMENT AND CONTROL . . . . . . . . . . . . . . . . . . . . . . . . . 25
7.1 Management Committee. . . . . . . . . . . . . . . . . . . 25
7.2 Management Committee Meetings; Quorum; Proxies. . . . . . 26
7.3 Management Committee's Authority; Certain Limitations . . 27
7.4 Officers; Agents. . . . . . . . . . . . . . . . . . . . . 28
7.5 Resignation of a Manager. . . . . . . . . . . . . . . . . 28
7.6 Compensation. . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE 8
LIABILITY AND INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . . 29
8.1 Liability of Members. . . . . . . . . . . . . . . . . . . 29
8.2 Indemnification.. . . . . . . . . . . . . . . . . . . . . 29
ARTICLE 9
TRANSFERS OF MEMBERSHIP INTERESTS. . . . . . . . . . . . . . . . . . . . 31
9.1 General Restrictions. . . . . . . . . . . . . . . . . . . 31
9.2 Permitted Transferees . . . . . . . . . . . . . . . . . . 32
9.3 Substitute Members. . . . . . . . . . . . . . . . . . . . 33
9.4 Effect of Admission as a Substitute Member. . . . . . . . 34
9.5 Consent . . . . . . . . . . . . . . . . . . . . . . . . . 34
9.6 No Dissolution. . . . . . . . . . . . . . . . . . . . . . 34
9.7 Additional Members; Certain Representations of Members. . 34
9.8 Right of First Offer. . . . . . . . . . . . . . . . . . . 34
9.9 Tag-Along Rights. . . . . . . . . . . . . . . . . . . . . 36
9.10 Drag-Along Rights . . . . . . . . . . . . . . . . . . . . 38
9.11 Piggyback Registration. . . . . . . . . . . . . . . . . . 40
9.12 Additional Members; Certain Representations of Members. . 42
ARTICLE 10
DISSOLUTION AND TERMINATION. . . . . . . . . . . . . . . . . . . . . . . 43
10.1 Events Causing Dissolution. . . . . . . . . . . . . . . . 43
10.2 Notices to Secretary of State . . . . . . . . . . . . . . 43
10.3 Cash Distributions Upon Dissolution . . . . . . . . . . . 43
10.4 In-Kind . . . . . . . . . . . . . . . . . . . . . . . . . 44
10.5 No Action for Dissolution . . . . . . . . . . . . . . . . 44
ARTICLE 11
TAX MATTERS MEMBER . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
11.1 Tax Matters Member. . . . . . . . . . . . . . . . . . . . 45
11.2 Certain Authorizations. . . . . . . . . . . . . . . . . . 45
11.3 Indemnity of Tax Matters Member . . . . . . . . . . . . . 46
11.4 Information Furnished . . . . . . . . . . . . . . . . . . 46
11.5 Notice of Proceedings, etc. . . . . . . . . . . . . . . . 47
11.6 Notices to Tax Matters Member . . . . . . . . . . . . . . 47
11.7 Preparation of Tax Returns. . . . . . . . . . . . . . . . 47
11.8 Tax Elections . . . . . . . . . . . . . . . . . . . . . . 47
11.9 Taxation as a Partnership . . . . . . . . . . . . . . . . 47
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ARTICLE 12
ACCOUNTING AND BANK ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . 48
12.1 Fiscal Year and Accounting Method . . . . . . . . . . . . 48
12.2 Books and Records . . . . . . . . . . . . . . . . . . . . 48
12.3 Delivery to Members; Inspection . . . . . . . . . . . . . 49
12.4 Financial Statements. . . . . . . . . . . . . . . . . . . 49
12.5 Filings . . . . . . . . . . . . . . . . . . . . . . . . . 49
12.6 Non-Disclosure. . . . . . . . . . . . . . . . . . . . . . 50
12.7 Bank Accounts . . . . . . . . . . . . . . . . . . . . . . 50
ARTICLE 13
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
13.1 Title to Property . . . . . . . . . . . . . . . . . . . . 50
13.2 Waiver of Default . . . . . . . . . . . . . . . . . . . . 51
13.3 Amendment . . . . . . . . . . . . . . . . . . . . . . . . 51
13.4 No Third Party Rights . . . . . . . . . . . . . . . . . . 51
13.5 Severability. . . . . . . . . . . . . . . . . . . . . . . 51
13.6 Nature of Interest in the Company . . . . . . . . . . . . 52
13.7 Binding Agreement . . . . . . . . . . . . . . . . . . . . 52
13.8 Headings. . . . . . . . . . . . . . . . . . . . . . . . . 52
13.9 Word Meanings . . . . . . . . . . . . . . . . . . . . . . 52
13.10 Counterparts. . . . . . . . . . . . . . . . . . . . . . . 52
13.11 Entire Agreement. . . . . . . . . . . . . . . . . . . . . 52
13.12 Partition . . . . . . . . . . . . . . . . . . . . . . . . 52
13.13 Governing Law; Consent to Jurisdiction and Venue. . . . . 53
13.14 Discretion. . . . . . . . . . . . . . . . . . . . . . . . 53
SCHEDULE 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SCHEDULE 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
SCHEDULE 7.4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
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AMENDED AND RESTATED
OPERATING AGREEMENT
OF
▇▇▇▇▇▇ OFFSHORE LLC
THIS AMENDED AND RESTATED OPERATING AGREEMENT (this "Agreement") of ▇▇▇▇▇▇
OFFSHORE LLC (the "Company"), is made and entered into as of the 16th day of
December, 1997 by and among the Persons executing this Agreement on the
signature pages hereto as a member (together with such other Persons that may
hereafter become members as provided herein, referred to collectively as the
"Members" or, individually, as a "Member").
WHEREAS, the Company was formed as a limited liability company under the
Delaware Limited Liability Company Act (the "Act") by the filing on August 1,
1997 of a certificate of formation of the Company with the Delaware Secretary of
State and, thereafter, on August 5, 1997, SEACOR Offshore Rigs Inc., a Delaware
corporation ("SEACOR"), as the Group A Member, and COI, LLC, a Delaware limited
liability company ("COI"), as the Group B Member, adopted an Operating Agreement
of ▇▇▇▇▇▇ Offshore LLC (the "Original Operating Agreement") as the limited
liability company agreement of the Company pursuant to Section 18-201(d) of the
Act effective as of such date; and
WHEREAS, as the date hereof, each of the Members (other than SEACOR and
COI) are parties to a Subscription Agreement dated as of December 11, 1997 (the
"Subscription Agreement") among the Company and such Members pursuant to which
each such Member has subscribed for and agreed to purchase certain membership
interests in the Company in exchange for the making by such Member of certain
cash capital contributions to the Company; and
WHEREAS, effective as of the date hereof, SEACOR, COI and the other Members
desire to adopt this Agreement as the amended and restated limited liability
company agreement of the Company in order to provide for (i) the waiver by
SEACOR and COI of certain of their rights under the Original Operating Agreement
relating to the sale of additional membership interests by the Company pursuant
to the Subscription Agreement, (ii) the making of certain additional
contributions by SEACOR to the Company, (iii) the admission of the Members
(other than SEACOR and COI) upon the making of certain capital contributions,
and (iv) the restatement and amendment of the Original Operating
Agreement in its entirety, all subject to the terms and conditions hereinafter
set forth.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual
agreements contained herein, the parties hereto, intending to be legally bound,
hereby agree as follows:
Waiver; Amendment and Restatement. Each of SEACOR and COI hereby expressly
waive any and all rights it may have under the Original Operating Agreement
relating to, or arising out of, the admission of the other Members and the sale
of Membership Interests to such Members pursuant to the Subscription Agreement,
including, without limitation, any rights under Section 3.7 of the Original
Operating Agreement. SEACOR and COI hereby agree to amend and restate the
Original Operating Agreement in its entirety and adopt this Agreement, and the
other Members hereby agree to adopt this Agreement, as the limited liability
company agreement of the Company, which Agreement will henceforth be substituted
in its entirety for the Original Operating Agreement by deleting in its entirety
the Original Operating Agreement and substituting therefor the above preambles
and the following:
"ARTICLE 1
DEFINITIONS
As used herein, the following terms shall have the following meanings,
unless the context otherwise requires:
"Act" means the Delaware Limited Liability Company Act, 6 Del. L. Section
18-101, et seq., as amended from time to time.
"Adjusted Capital Account Deficit" means, with respect to a Member, the
deficit balance, if any, in such Member's Capital Account as of the end of the
relevant Taxable Year, after giving effect to the following adjustments:
(a) Credit to such Capital Account any amounts which such Member is
obligated to restore pursuant to any provision of this Agreement or is
deemed to be obligated to restore pursuant to the penultimate sentences of
Regulation Sections 1.704-2(g)(1) and 1.704-2(i)(5); and
(b) Debit to such Capital Account the items described in Regulation
Sections
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1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), and
1.704-1(b)(2)(ii)(d)(6).
The foregoing definition of Adjusted Capital Account Deficit is intended to
comply with the provisions of Regulation Section 1.704-1(b)(2)(ii)(d) and shall
be interpreted consistently therewith.
"Affiliate" of a specified Person means any Person who directly or
indirectly controls, is controlled by, or is under common control with, such
Person.
"Agreement" means this Amended and Restated Operating Agreement, which
shall constitute the limited liability company agreement of the Company for
purposes of the Act, as amended from time to time.
"Business Day" means any day (other than a day which is a Saturday, Sunday
or legal holiday in the state of New York) on which banks are open for business
in New York City.
"Capital Account" means, with respect to any Member, a separate account
established by the Company and maintained for each Member in accordance with
Section 3.4 hereof.
"Capital Contribution" means, with respect to any Member, the amount of
money and the initial Gross Asset Value of any Property (other than money)
contributed to the Company with respect to the interests purchased by such
Member pursuant to the terms of this Agreement, in return for which the Member
contributing such capital shall receive a Membership Interest.
"Certificate" means the Certificate of Formation of the Company as filed on
August 1, 1997 with the Secretary of State of Delaware, as amended or restated
from time to time.
"Code" means the United States Internal Revenue Code of 1986, as amended.
"COI" means COI, LLC, a Delaware limited liability company.
"Company" means ▇▇▇▇▇▇ Offshore LLC.
"Company Affiliate" shall have the meaning set forth in Section 8.2.
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"Company Minimum Gain" shall have the meaning set forth for "partnership
minimum gain" in Regulation Section 1.704-2(b)(2) and shall be determined in
accordance with the provisions of Regulation Section 1.704-2(d).
"Depreciation" means, for each Taxable Year or other period, an amount
equal to the depreciation, amortization or other cost recovery deduction
allowable with respect to an asset for such Taxable Year, except that if the
Gross Asset Value of an asset differs from its adjusted basis for federal income
tax purposes at the beginning of such Taxable Year, Depreciation shall be an
amount which bears the same ratio to such beginning Gross Asset Value as the
federal income tax depreciation, amortization or other cost recovery deduction
for such Taxable Year bears to such beginning adjusted tax basis; provided,
however, that if the adjusted basis for federal income tax purposes of an asset
at the beginning of such Taxable Year is zero, Depreciation shall be determined
with reference to such beginning Gross Asset Value using any reasonable method
selected by the Management Committee.
"Gross Asset Value" means with respect to any asset, the asset's adjusted
basis for federal income tax purposes, except as follows and as otherwise
provided in clause (ii) of Section 3.2(b):
(a) The initial Gross Asset Value of any asset contributed by a
Member to the Company shall be the gross fair market value of such asset,
as reasonably determined by the Management Committee; provided, however,
that the initial Gross Asset Values of the assets contributed to the
Company pursuant to, or as described in, Section 3.1 hereof shall be as set
forth in such section or the schedule referred to therein;
(b) The Gross Asset Values of all Company assets shall be adjusted to
equal their respective gross fair market values (taking Code Section
7701(g) into account), as reasonably determined by the Management Committee
as of the following times: (i) the acquisition of an additional interest
in the Company by any new or existing Member in exchange for more than a de
minimis Capital Contribution; (ii) the distribution by the Company to a
Member of more than a de minimis amount of Company property as
consideration for an interest in the Company; and (iii) the liquidation of
the Company within the
4
meaning of Regulation Section 1.704-1(b)(2)(ii)(g); provided, however, that
an adjustment described in clauses (i) and (ii) of this paragraph shall be
made only if the Management Committee reasonably determines that such
adjustment is necessary to reflect the relative economic interests of the
Members in the Company; and
(c) The Gross Asset Value of any item of Company assets distributed
to any Member shall be adjusted to equal the gross fair market value
(taking Code Section 7701(g) into account) of such asset on the date of
distribution as reasonably determined by the Management Committee.
If the Gross Asset Value of an asset has been determined or adjusted pursuant to
subparagraph (b), such Gross Asset Value shall thereafter be adjusted by the
Depreciation taken into account with respect to such asset, for purposes of
computing Profits and Losses.
"Group A Members" means the Persons listed on Schedule 1 as Group A members
and their respective permitted successors or assigns.
"Group B Members" means, the Persons listed on Schedule 1 as Group B
members and their respective permitted successors or assigns.
"Group C Members" means, the Persons listed on Schedule 1 as Group C
members and their respective permitted successors or assigns.
"Immediate Family Member" shall mean with respect to any Member that is a
natural Person, such Member's spouse, mother, father, brother, sister or child,
a trust established solely for the benefit of one or more Immediate Family
Members or the estate or personal representative of a deceased Member.
"Initial Tag-Along Notice" shall have the meaning set forth in Section
9.9(a).
"Losses" has the meaning set forth in the definition of "Profits" and
"Losses".
"Majority in Interest" means, with respect to the Members or to any
specified group or class of Members, Members owning more than fifty percent
(50%) of the total
5
Percentage Interests held by all Members or such specified group or class of
Members, as applicable.
"Management Committee" means the management committee of the Company
established pursuant to Section 7.1.
"Managers" means, collectively, the Persons designated and serving in
accordance with Article 7 as members of the Management Committee.
"Member" or "Members" shall have the meaning set forth in the preamble
hereof.
"Member Nonrecourse Debt" has the meaning set forth for "partner
nonrecourse debt" in Regulation Section 1.704-2(i)(4).
"Member Nonrecourse Debt Minimum Gain" means an amount, with respect to
each Member Nonrecourse Debt, equal to the Company Minimum Gain that would
result if such Member Nonrecourse Debt were treated as a Nonrecourse Liability,
determined in accordance with Regulation Section 1.704-2(i)(3).
"Member Nonrecourse Deductions" has the meaning set forth for "partner
nonrecourse deductions" in Regulation Sections 1.704-2(i)(1) and 1.704-2(i)(2).
"Membership Interest" means a Member's limited liability company interest
in the Company which refers to all of a Member's rights and interests in the
Company in such Member's capacity as a Member, all as provided in this Agreement
and the Act.
"Net Cash Flow" shall mean the gross cash proceeds from the Company's
operations and any distributions received from its subsidiaries (excluding the
proceeds of Company borrowings and capital contributions) and from all sales and
other dispositions of the Company's Property and any amount released by the
Management Committee from Reserves, less the portion of gross proceeds (other
than the proceeds of the Company's borrowings and capital contributions) used to
pay or establish Reserves for all the Company's expenses, debt payments
(including principal, interest and required redemption payments), capital
improvements, replacements and contingencies, all as reasonably determined by
the Management Committee. Net Cash Flow shall not be reduced by Depreciation or
similar allowances and shall include the net cash proceeds of all principal and
interest payments
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actually received by the Company with respect to any promissory note or other
deferred payment obligation held by the Company in connection with sales and
other dispositions of the Company's Property.
"Nonrecourse Deductions" has the meaning set forth in Regulation Section
1.704-2(b)(1).
"Nonrecourse Liability" has the meaning set forth in Regulation Section
1.704-2(b)(3).
"Notice" means a writing, containing the information required by this
Agreement to be communicated to a party, and shall be deemed to have been
received (a) when personally delivered or sent by telecopy, (b) one day
following delivery by overnight delivery courier, with all delivery charges
pre-paid, or (c) on the third Business Day following the date on which it was
sent by United States mail, postage prepaid, to such party at the address or fax
number, as the case may be, of such party as shown on the records of the
Company.
"Percentage Interest" of a Member means the aggregate limited liability
company percentage interest set forth on Schedule 1 hereto, as the same may be
modified from time to time as provided herein.
"Permitted Transferee" means a Person who becomes a transferee in
accordance with Section 9.2.
"Person" means any individual, partnership, limited liability company,
corporation, cooperative, trust, estate or other entity.
"Profits" and "Losses" means, for each Taxable Year, an amount equal to the
Company's taxable income or loss for a taxable year, determined in accordance
with Section 703(a) of the Code (for this purpose, all items of income, gain,
loss or deduction required to be stated separately pursuant to Section 703(a)(1)
of the Code shall be included in taxable income or loss), with the following
adjustments:
(a) Any income of the Company that is exempt from federal income tax
and not otherwise taken into account in computing Profits or Losses shall
be added to such taxable income or loss;
(b) Any expenditures of the Company described in Section 705(a)(2)(B)
of the Code or
7
treated as Code Section 705(a)(2)(B) expenditures pursuant to Regulation
Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in
computing Profits or Losses, shall be subtracted from such taxable income
or loss;
(c) In the event the Gross Asset Value of any Company asset is
adjusted pursuant to subparagraphs (b) or (c) of the definition of Gross
Asset Value, the amount of such adjustment shall be treated as an item of
gain (if the adjustment increases the Gross Asset Value of the asset) or an
item of loss (if the adjustment decreases the Gross Asset Value of the
asset) from the disposition of such asset and shall be taken into account
for purposes of computing Profits or Losses;
(d) Gain or loss resulting from any disposition of Property with
respect to which gain or loss is recognized for federal income tax purposes
shall be computed by reference to the Gross Asset Value of the Property
disposed of, notwithstanding that the adjusted tax basis of such Property
differs from its Gross Asset Value;
(e) In lieu of the depreciation, amortization, and other cost
recovery deductions taken into account in computing such taxable income or
loss, there shall be taken into account Depreciation for such Taxable Year,
computed in accordance with the definition of Depreciation; and
(f) Notwithstanding any other provision of this definition, any items
which are specially allocated pursuant to Section 5.3 or Section 5.4 hereof
shall not be taken into account in computing Profits or Losses. The
amounts of the items of the Company income, gain, loss or deduction
available to be specially allocated pursuant to Sections 5.3 and 5.4 hereof
shall be determined by applying rules analogous to those set forth in
subparagraphs (a) through (e) above.
"Property" means all assets, real or intangible, that the Company may own
or otherwise have an interest in from time to time.
"Regulations" means the regulations, including temporary regulations,
promulgated by the United States Department of
8
Treasury with respect to the Code, as such regulations are amended from time to
time, or corresponding provisions of future regulations.
"Reserves" means the cash reserves established by the Management Committee
to provide for working capital, future investments, debt service and such other
purposes as may be deemed reasonably necessary or advisable by the Management
Committee.
"SEACOR" means SEACOR Offshore Rigs Inc., a Delaware corporation.
"SEACOR Group" shall have the meaning set forth in Section 3.7(a).
"SEACOR SMIT" means SEACOR SMIT Inc., a Delaware corporation and, as of the
date hereof, the parent of SEACOR.
"SEC" means the Securities and Exchange Commission.
"Secretary" shall mean the Secretary of the Treasury or his/her delegate or
the Internal Revenue Service.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Section 9.8 Offeree" shall have the meaning set forth in Section 9.8(a).
"Section 9.8 Proposed Purchaser" shall have the meaning set forth in
Section 9.8(a).
"Section 9.8 Selling Member" shall have the meaning set forth in Section
9.8(a).
"Section 9.9 Participating Tagged Members" shall have the meaning set forth
in Section 9.9(a).
"Section 9.9 Proposed Purchaser" shall have the meaning set forth in
Section 9.9(a).
"Section 9.9 Tag-Along Membership Interest" shall have the meaning set
forth in Section 9.9(a).
"Section 9.9 Tagged Members" shall have the meaning set forth in Section
9.9(a).
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"Section 9.10 Drag-Along Membership Interest" shall have the meaning set
forth in Section 9.10(a).
"Section 9.10 Dragged Members" shall have the meaning set forth in Section
9.10(a).
"Section 9.10 Proposed Purchaser" shall have the meaning set forth in
Section 9.10(a).
"Section 9.10 Selling Member" shall have the meaning set forth in Section
9.10(a).
"Tag-Along Right" shall have the meaning set forth in Section 9.9(a).
"Tag-Along Notice" shall have the meaning set forth in Section 9.9(a).
"Taxable Year" shall mean the taxable year of the Company in accordance
with the provisions of Section 706 of the Code.
"Tax Distribution" means an amount equal (i) to the taxable income of the
Company allocated to the Members for a Taxable Year multiplied by the sum of (x)
the highest federal income tax rate applicable to individuals for such Taxable
Year and (y) 6%, divided by (ii) the lowest aggregate Percentage Interests held
by the Group B Members during such Taxable Year. Cash Distributions in respect
of the Tax Distribution shall be made quarterly as provided in Section 4.1
hereof, based on a reasonable estimate of the amount of Tax Distribution for
such Taxable Year. The amount of Tax Distribution shall be computed by the
Company's regular independent public accounting firm.
"Tax Matters Member" shall have the meaning set forth in Article 11.
"Transfer" or "Transferred" means (a) when used as a verb, to give, sell,
exchange, assign, transfer, pledge, hypothecate, bequeath, devise or otherwise
dispose of or encumber, and (b) when used as a noun, the nouns corresponding to
such verbs, in either case voluntarily or involuntarily, by operation of law or
otherwise. When referring to a Membership Interest, "Transfer" shall mean the
Transfer of such Membership Interest whether of record, beneficially, by
participation or otherwise.
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"Unaffiliated Members" shall have the meaning set forth in Section 3.2.
ARTICLE 2
FORMATION AND OFFICES
2.1 Formation. Pursuant to the Act, the Company has been formed as a
Delaware limited liability company effective upon the filing of the
Certificate of the Company with the Secretary of State of Delaware. To the
extent that the rights or obligations of any Member are different by reason of
any provision of this Agreement than they would be in the absence of such
provision, to the extent permitted by the Act, this Agreement shall control.
2.2 Principal Office. The principal office of the Company shall be
located at ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ or at such
other place(s) as the Management Committee may determine from time to time.
2.3 Registered Office and Registered Agent. The location of the
registered office and the name of the registered agent of the Company in the
State of Delaware shall be as stated in the Certificate, as determined from
time to time by the Management Committee.
2.4 Purpose of Company. The Company's purposes, and the nature of the
business to be conducted and promoted by the Company are (a) to manage and
supervise either directly or through one or more other Persons owned and
controlled directly or indirectly by the Company, all aspects of the
construction of premium jackup rigs, and, upon their completion, manage all
aspects of their operation and receive therefor certain construction
supervision fees and management fees, (b) to form and act as managing general
partner of any such Person that is a partnership, (c) to engage in any other
lawful act or activity for which limited liability companies may be formed
under the Act, and (d) to engage in any and all activities necessary,
advisable, convenient or incidental to the foregoing.
2.5 Date of Dissolution. The term of the Company shall continue until
the close of business on August 1, 2032 or until the earlier dissolution under
Article 10 hereof. The existence of the Company as a separate legal entity
shall continue until cancellation of the Certificate in the manner required by
the Act.
11
2.6 Qualification. The execution, delivery and filing of the
Certificate on August 1, 1997 by ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, in his capacity as an
authorized person, within the meaning of the Act, is hereby ratified, approved
and confirmed in all respects. The President and Chief Executive Officer, any
Vice President, the Secretary and any Assistant Secretary of the Company are
hereby authorized to qualify the Company to do business as a foreign limited
liability company in any state or territory in the United States in which the
Company may wish to conduct business and each is hereby designated as an
authorized person, within the meaning of the Act, to execute, deliver and file
any amendments or restatements of the Certificate and any other certificates
and any amendments or restatements thereof necessary for the Company to so
qualify to do business in any such state or territory.
ARTICLE 3
CAPITALIZATION OF THE COMPANY
3.1 Certain Additional and Initial Capital Contributions. Each of the
Members hereby acknowledges that each of SEACOR and COI made certain Capital
Contributions to the Company on August 5, 1997 as specified and as set forth
opposite its respective name on Schedule 1. On the date hereof, (i) SEACOR
shall make additional Capital Contributions to the capital of the Company
consisting of cash or the contribution of certain indebtedness as set forth on
Schedule 1, (ii) each Member (other than SEACOR and COI) shall make initial
Capital Contributions to the capital of the Company consisting of cash, all as
specified and as set forth opposite such Member's name (including SEACOR) on
Schedule 1 hereto. The Percentage Interest of each Member following such
Capital Contributions on the date hereof, is likewise set forth on Schedule 1.
3.2 Additional Capital Contributions.
(a) Except as otherwise expressly provided in this Agreement, no Member
shall be required to make any additional Capital Contribution. No Member
shall be permitted to make any additional Capital Contribution without the
approval of the Management Committee.
(b) Subject to the rights of each Member to purchase its proportionate
share of additional Membership Interests issued by the Company in accordance
with Section 3.6, the Company may offer additional Membership Interests to:
12
(i) any Person that is not an Affiliate or Immediate Family Member
of a Member, as the case may be, with the approval of the Management
Committee; or
(ii) any Person that is a Member or is an Affiliate of a Member or
Immediate Family Member of a Member, as the case may be, with the approval of
(A) the Management Committee, and (B) a Majority in Interest of the Members
other than (1) any Member purchasing such additional Membership Interests and
(2) any Member whose Affiliate(s) or Immediate Family Member(s) is purchasing
such additional Membership Interests (such Members, other than those referred
to in clauses (1) and (2) above being referred to as the "Unaffiliated
Members"), it being expressly understood that such approval of the Members
shall also include their approval of any related valuations of Gross Asset
Value by the Management Committee and, if such Members approve the Transfer
without approving said valuation, Gross Asset Value shall be determined by a
third Person familiar with the valuation of such transactions selected jointly
by the Management Committee and a Majority in Interest of the Unaffiliated
Members not later than ten (10) days after their approval of the Transfer or,
if the Management Committee and such Members fail to so select a third Person,
then such third Person will be selected in accordance with the rules and
procedures of the American Arbitration Association in New York, New York.
If after the date hereof, any additional Capital Contributions are
made by Members but not in proportion to their respective Percentage
Interests, the Percentage Interest of each Member shall be adjusted such that
each Member's revised Percentage Interest determined immediately following the
additional Capital Contributions shall be equal to a fraction (1) the
numerator of which is the sum of (a) the positive Capital Account balance of
the Member determined immediately preceding the date the additional Capital
Contribution is made (such Capital Account to be computed by adjusting the
book value for Capital Account purposes of each Company asset to equal its
Gross Asset Value as of such date, as provided in subparagraph (b) of the
definition herein of "Gross Asset Value"), and (b) the additional Capital
Contribution, if any, made by such Member, and (2) the denominator of which is
the sum of the positive Capital Account balances and additional Capital
Contributions of all Members, including any new Members (in each case
calculated as provided in Section 3.2(b)(ii)(l)). The names, addresses and
Capital Contributions of the
13
Members shall be reflected in the books and records of the Company.
3.3 Loans. (a) No Member shall be obligated to loan funds to the
Company. Loans by a Member to the Company shall not be considered Capital
Contributions. The amount of any such loans shall be a debt of the Company
owed to such Member in accordance with the terms and conditions upon which
such loans are made.
(b) A Member may (but shall not be obligated to) guarantee a loan made
to the Company. If a Member guarantees a loan made to the Company and is
required to make payment pursuant to such guarantee to the maker of the loan,
then the amounts so paid to the maker of the loan shall be treated as a loan
by such Member to the Company and not as an additional capital contribution.
3.4 Maintenance of Capital Accounts.
(a) The Company shall maintain for each Member, a separate Capital
Account with respect to the Membership Interest owned by such Member in
accordance with the following provisions:
(i) To each Member's Capital Account there shall be credited (A)
such Member's Capital Contributions, (B) such Member's distributive share
of Profits and any items in the nature of income or gain which are
specially allocated pursuant to Section 5.3 or Section 5.4 hereof, and
(C) the amount of any Company liabilities assumed by such Member or which
are secured by any Property distributed to such Member. The principal
amount of a promissory note which is not readily traded on an established
securities market and which is contributed to the Company by the maker of
the note (or a Member related to the maker of the note within the meaning
of Regulation Section 1.704-1(b)(2)(ii)(c)) shall not be included in the
Capital Account of any Member until the Company makes a taxable
disposition of the note or until (and only to the extent) principal
payments are made on the note, all in accordance with Regulation Section
1.704-1(b)(2)(iv)(d)(2);
(ii) To each Member's Capital Account there shall be debited (A) the
amount of money and the Gross Asset Value of any Property distributed or
treated as an advance distribution to such Member pursuant to any
14
provision of this Agreement (including without limitation any
distributions pursuant to Section 4.1(a)), (B) such Member's distributive
share of Losses and any items in the nature of expenses or losses which
are specially allocated pursuant to Section 5.3 or Section 5.4 hereof,
and (C) the amount of any liabilities of such Member assumed by the
Company or which are secured by any Property contributed by such Member
to the Company;
(iii) In the event Membership Interests are Transferred in
accordance with the terms of this Agreement, the transferee shall succeed
to the Capital Account of the transferor to the extent it relates to the
Transferred Membership Interests; and
(iv) In determining the amount of any liability for purposes of
Sections 3.4(a)(i) and 3.4(a)(ii) there shall be taken into account Code
Section 752(c) and any other applicable provisions of the Code and
Regulations.
(b) The foregoing Section 3.4(a) and the other provisions of this
Agreement relating to the maintenance of Capital Accounts are intended to
comply with Regulation Section 1.704-1(b) and, to the greatest extent
practicable, shall be interpreted and applied in a manner consistent with such
Regulation. The Management Committee in its discretion and to the extent
otherwise consistent with this Agreement shall (i) make any adjustments that
are necessary or appropriate to maintain equality between the Capital Accounts
of the Members and the amount of capital reflected on the Company's balance
sheet, as computed for book purposes, in accordance with Regulation Section
1.704-1(b)(2)(iv)(q), and (ii) make any appropriate modifications in the event
unanticipated events might otherwise cause this Agreement not to comply with
Regulation Section 1.704-1(b).
3.5 Capital Withdrawal Rights, Interest and Priority. Except as
expressly provided in this Agreement, no Member shall be entitled (a) to
withdraw or reduce such Member's Capital Contribution or to receive any
distributions from the Company, or (b) to receive or be credited with any
interest on the balance of such Member's Capital Contribution at any time.
3.6 Preemptive Rights. Subject to Section 3.2, if the Company elects to
offer and sell Membership Interests other than the Membership Interests set
forth on Schedule 1 and
15
Excluded Sales (as hereinafter defined), such additional Membership Interests
shall be in the form of Membership Interests having such Percentage Interest,
designations and such rights and provisions, including, but not limited to,
provisions relating to distributions and allocations of Profits and Losses, as
shall be reasonably determined by the Management Committee to be in the best
interest of the Company; provided, however, that the Company may not offer and
sell any Membership Interests having preferences to the rights of the Members
with respect to distributions, allocations or rights upon liquidation, without
the prior written consent of Members owning more than two-thirds of the total
percentage interest held by all Members (it being understood that no such
consent shall be required for the offering or sale of Membership Interests
that are entitled to distributions, allocations and rights upon liquidation
that are pari passu to the rights of the existing Members). Prior to the
consummation of any sale of additional Membership Interests (other than
Excluded Sales), the Company shall offer the additional Membership Interests
to the Members, on the terms and conditions set forth below:
(a) The Company shall give Notice to each Member, setting forth the
price, terms and conditions of the proposed sale of the additional
Membership Interests.
(b) Each Member shall have the option to acquire all or a portion
of such Member's pro rata portion (which shall be in proportion to the
Percentage Interest of all the Members) at the time of the offering of
the additional Membership Interests proposed to be sold, on the same
terms and conditions as are set forth in the Notice. The option of
Members to purchase all or a portion of their pro rata portions of the
additional Membership Interests shall be exercised by delivery of a
Notice to the Company of exercise within ten (10) Business Days following
receipt of the Company's Notice of the price, terms and conditions of the
sale of the additional Membership Interests. If less than all the
Membership Interests to be sold by the Company are purchased by the
Members, the Company may within sixty (60) calendar days from the
expiration of said option, sell such Membership Interests as shall not
have been purchased by the Members upon terms and conditions no less
favorable to the Company than those set forth in the Notice.
16
(c) The sale of additional Membership Interests to Members who
exercise their options to purchase additional Membership Interests shall
occur on the date set forth in a Notice from the Company to such Members,
which date shall not be earlier than thirty (30) days after the date of
expiration of the offer to Members under Section 3.6(b).
(d) For purposes of this Section 3.6, the term "Excluded Sales"
shall mean (i) any shares of the capital stock of the Company issued upon
conversion of the Company into a corporation, (ii) following any such
conversion, any shares of the capital stock of the Company issued
pursuant to a public offering and sale of equity securities of the
Company pursuant to an effective registration statement under the
Securities Act, (iii) membership interests issued pursuant to the
acquisition of another Person by the Company, by merger, purchase of all
or substantially all of such other Person's securities or assets or
otherwise pursuant to which the Company shall become the owner of more
than fifty percent (50%) of the voting power of such other Person, and
(iv) Membership Interests Transferred to or options to purchase
Membership Interest granted to, employees, directors, advisors or
consultants to the Company under a Company membership interest option or
similar equity incentive plan; provided however, that the Company will
not Transfer Membership Interests, or grant options, under any such plan,
aggregating more than five percent (5%) of the Membership Interests of
the Company on a fully diluted basis (assuming the exercise of such
options); and, provided further, the exercise price for Membership
Interests under each such option shall not be less than the price for an
equivalent percentage Membership Interest acquired on the date hereof by
the Group C Members.
3.7 Certain SEACOR Transactions.
(a) Except as otherwise provided in Section 3.7(b), in the event
SEACOR or its parent SEACOR SMIT, or any other consolidated subsidiary of
SEACOR SMIT (collectively, the "SEACOR Group") provides management,
administrative, financial or investment-banking type services to the
Company or any of its subsidiaries with the respect to any rig
transactions or otherwise, such member of the SEACOR Group shall be
entitled to receive reasonable fees and reimbursement for expenses
incurred
17
in connection with the provision of such services so long as such fees
are not in excess of fees charged by unrelated Persons for comparable
services.
(b) The Company shall pay SEACOR SMIT a management fee for
financial and other services provided to the Company and its subsidiaries
by ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Vice President, Finance of SEACOR SMIT. Such
management fee to be determined based on the value of the services
provided by ▇▇. ▇▇▇▇▇▇▇▇▇ to the Company and its subsidiaries, including
reimbursement of any related out-of-pocket expenses incurred by SEACOR
SMIT, after taking into account the compensation typically paid for such
services and the percentage of ▇▇. ▇▇▇▇▇▇▇▇▇'▇ time allocated to
activities relating to the Company and its subsidiaries.
ARTICLE 4
DISTRIBUTIONS
4.1 Distributions of Net Cash Flow. Distributions of Net Cash Flow to
the Members shall be made as follows:
(a) quarterly, to the Members in proportion to and to the extent of
their relative Percentage Interests, an amount not in excess of the Tax
Distribution for the Taxable Year; provided, however, that distributions
under this Section 4.1(a) shall be treated as advance distributions under
Section 4.1(b), with the result that distributions otherwise made under
Section 4.1(b) to such Member shall be reduced by the amount of advances
made pursuant to this Section 4.1(a); and
(b) upon the approval of and in the amount so approved by the
Management Committee acting in its sole discretion, to the Members in
proportion to their relative Percentage Interests.
4.2 Persons Entitled to Distributions. All distributions of Net Cash
Flow to the Members under this Article 4 shall be made to the Persons shown on
the records of the Company to be entitled thereto as of the last day of the
fiscal period prior to the time for which such distribution is to be made,
unless the transferor and transferee of any Membership Interest otherwise
agree in writing to a different distribution and such distribution is
consented to in writing by the Management Committee.
18
4.3 Limitations on Distributions. Notwithstanding anything to the
contrary herein provided, no distribution hereunder shall be permitted to the
extent prohibited by Section 18-607 of the Act.
ARTICLE 5
ALLOCATIONS
5.1 Profits. After giving effect to the special allocations set forth
in Sections 5.3 and 5.4 hereof and subject to Section 5.7 hereof, Profits for
any Taxable Year shall be allocated to the Members in proportion to their
Percentage Interests.
5.2 Losses. After giving effect to the special allocations set forth in
Sections 5.3 and 5.4, subject to the limitation in Section 5.5 hereof and
subject to Section 5.7 hereof, Losses for any Taxable Year shall be allocated
to the Members in proportion to their Percentage Interests.
5.3 Special Allocations. The following special allocations shall be
made in the following order:
(a) Minimum Gain Chargeback. Except as otherwise provided in
Section 1.704-2(f) of the Regulations, notwithstanding any other
provision of this Article 5, if there is a net decrease in Company
Minimum Gain during any Taxable Year, each Member shall be specially
allocated items of Company income and gain for such year (and, if
necessary for subsequent years) in proportion to, and to the extent of,
an amount equal to each Member's share of the net decrease in Company
Minimum Gain during such taxable year as determined in accordance with
the provisions of Regulation Section 1.704-2(g). Allocations pursuant to
the previous sentence shall be made in proportion to the respective
amounts required to be allocated to each Member pursuant thereto. The
items to be so allocated shall be determined in accordance with Sections
1.704-2(f) (6) and 1.704-2(j) (2) of the Regulations. This Section
5.3(a) is intended to comply with the minimum gain chargeback requirement
in Section 1.704-2(f) of the Regulations and shall be interpreted
consistently therewith.
(b) Member Minimum Gain Chargeback. Except as otherwise provided
in Section 1.704-2(i) (4) of the Regulations, notwithstanding any other
provision of
19
this Section 5, if there is a net decrease in Member Nonrecourse Debt
Minimum Gain attributable to a Member Nonrecourse Debt during any Taxable
Year, each Member who has a share of the Member Nonrecourse Debt Minimum
Gain attributable to such Member Nonrecourse Debt, determined in
accordance with Section 1.704-2(i) (5) of the Regulations, shall be
specially allocated items of Company income and gain for such Taxable
Year (and, if necessary, subsequent Taxable Years) in an amount equal to
such Member's share of the net decrease in Member Nonrecourse Debt,
determined in accordance with Regulation Section 1.704-2(i) (4).
Allocations pursuant to the previous sentence shall be made in proportion
to the respective amounts required to be allocated to each Member
pursuant thereto. The items to be so allocated shall be determined in
accordance with Sections 1.704-2(i) (4) and 1.704-2(j) (2) of the
Regulations. This Section 5.3(b) is intended to comply with the minimum
gain chargeback requirement in Section 1.704-2(i) (4) of the Regulations
and shall be interpreted consistently therewith.
(c) Qualified Income Offset. In the event any Member unexpectedly
receives any adjustments, allocations, or distributions described in
Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or
1.704-1(b)(2)(ii)(d)(6) of the Regulations, items of Company income and
gain shall be specially allocated to such Member in an amount and manner
sufficient to eliminate, to the extent required by the Regulations, the
Adjusted Capital Account Deficit of the Member as quickly as possible,
provided that an allocation pursuant to this Section 5.3(c) shall be made
only if and to the extent that the Member would have an Adjusted Capital
Account Deficit after all other allocations provided for in this Section
5 have been tentatively made.
(d) Gross Income Allocation. In the event any Member has a deficit
Capital Account at the end of any Taxable Year which is in excess of the
sum of (i) the amount such Member is obligated to restore pursuant to any
provision of this Agreement and (ii) the amount such Member is obligated
to restore pursuant to the penultimate sentences of Regulations Sections
1.704-2(g)(1) and 1.704-2(i)(5), each such Member shall be specially
allocated items of Company income and gain in the amount of such excess
as quickly as possible; provided, however, that an allocation pursuant to
this
20
Section 5.3(d) shall be made only if and to the extent that such Member
would have a deficit Capital Account in excess of such sum after all
other allocations provided for in this Section 5 have been made other
than those allocations pursuant to Section 5.3(c) and this Section
5.3(d).
(e) Nonrecourse Deductions. Nonrecourse Deductions for any Taxable
Year shall be specially allocated to the Members in proportion to their
respective Percentage Interests.
(f) Member Nonrecourse Deductions. Any Member Nonrecourse
Deductions for any Taxable Year shall be specially allocated to the
Member who bears the economic risk of loss with respect to the Member
Nonrecourse Debt to which such Member Nonrecourse Deductions are
attributable in accordance with Regulation Section 1.704-2(i) (1).
5.4 Curative Allocations. The allocations set forth in Sections 5.3(a),
5.3(b), 5.3(c), 5.3(d), 5.3(e), 5.3(f) and 5.5 (the "Regulatory Allocations")
are intended to comply with certain requirements of the Regulations. It is
the intent of the Members that, to the extent possible, all Regulatory
Allocations shall be offset either with other Regulatory Allocations or with
special allocations of other items of Company income, gain, loss or deduction
pursuant to this Section 5.4. Therefore, notwithstanding any other provision
of this Section 5 (other than the Regulatory Allocations), following any
Regulatory Allocation, the Management Committee shall use its best efforts to
make such offsetting special allocations of Company income, gain, loss or
deduction in whatever reasonable manner it determines so that, after such
offsetting allocations are made, each Member's Capital Account balance is, to
the extent possible, equal to the Capital Account balance such Member would
have had if the Regulatory Allocations had not been made and all Company items
were allocated pursuant to Sections 5.1 and 5.2.
5.5 Loss Limitation. Losses allocated pursuant to Section 5.2 hereof
shall not exceed the maximum amount of Losses that can be allocated without
causing any Member to have an Adjusted Capital Account Deficit at the end of
any Taxable Year. In the event some but not all the Members would have
Adjusted Capital Account Deficits as a consequence of an allocation of Losses
pursuant to Section 5.2 hereof, the limitation set forth in this Section 5.5
21
shall be applied on a Member by Member basis and Losses not allocable to any
Member as a result of such limitation shall be allocated to the other Members
pro rata in accordance with the positive balances in such Members' Capital
Accounts so as to allocate the maximum permissible Losses to each Member under
Section 1.704-1(b)(2)(ii)(d) of the Regulations.
5.6 Tax Allocations: Code Section 704(c).
(a) In accordance with Code Section 704(c) and the Regulations
thereunder, income, gain, loss and deduction with respect to any Property
contributed to the capital of the Company shall, solely for tax purposes, be
allocated among the Members so as to take account of any variation between the
adjusted basis of such Property to the Company for federal income tax purposes
and its initial Gross Asset Value (computed in accordance with the definition
of Gross Asset Value).
(b) In the event the Gross Asset Value of any Company asset is adjusted
pursuant to subparagraph (b) of the definition of Gross Asset Value,
subsequent allocations of income, gain, loss and deduction with respect to
such asset shall take account of any variation between the adjusted basis of
such asset for federal income tax purposes and its Gross Asset Value in the
same manner as under Code Section 704(c) and the Regulations thereunder.
(c) Any elections or other decisions relating to such allocations shall
be made by the Management Committee in any manner that reasonably reflects the
purpose and intention of this Agreement; provided, that the Company, in the
discretion of the Management Committee, may make, or not make, "curative" or
"remedial" allocations (within the meaning of the Regulations under Code
Section 704(c)) including, but not limited to, "curative" allocations which
offset the effect of the "ceiling rule" for a prior Taxable Year (within the
meaning of Regulation Section 1.704-3(c)(3)(ii) and "curative" allocations
from disposition of contributed property (within the meaning of Regulation
Section 1.704-3(c)(3)(iii)(B). Allocations pursuant to this Section 5.6 are
solely for purposes of federal, state, and local taxes and shall not affect,
or in any way be taken into account in computing, any Member's Capital Account
or share of Profits, Losses, other items, or distributions (other than Tax
Distributions) pursuant to any provision of this Agreement.
22
5.7 Change in Percentage Interests. In the event that the Members'
Percentage Interests change during a Taxable Year, Profits and Losses shall be
allocated taking into account the Members' varying Percentage Interests for
such Taxable Year, determined on a daily, monthly or other basis as determined
by the Management Committee, using any permissible method under Code Section
706 and the Regulations thereunder.
5.8 Withholding. Each Member hereby authorizes the Company to withhold
and to pay over any taxes payable by the Company or any of its Affiliates as a
result of such Member's participation in the Company; if and to the extent
that the Company shall be required to withhold any such taxes, such Member
shall be deemed for all purposes of this Agreement to have received a payment
from the Membership as of the time such withholding is required to be paid,
which payment shall be deemed to be a distribution to such Member to the
extent that the Member is then entitled to receive a distribution. To the
extent that the aggregate of such payments in respect of a Member for any
period exceeds the distributions to which such Member is entitled for such
period, the amount of such excess shall be considered a demand loan from the
Company to such Member, with interest at 8% per annum, which interest shall be
treated as an item of Company income, until discharged by such Member by
repayment, which may be made in the sole discretion of the Management
Committee out of distributions to which such Member would otherwise be
subsequently entitled. The withholdings referred to in this Section 5.8 shall
be made at the maximum applicable statutory rate under the applicable tax law
unless the Management Committee shall have received an opinion of counsel or
other evidence, satisfactory to the Management Committee, to the effect that a
lower rate is applicable, or that no withholding is applicable.
ARTICLE 6
MEMBERS' MEETINGS
6.1 Meetings of Members; Place of Meetings. Regular meetings of the
Members may be held on an annual basis or more frequently as determined by a
Majority in Interest of the Members. All meetings of the Members shall be
held in New York, New York or Houston, Texas as designated from time to time
by the Management Committee and stated in the Notice of the meeting or in a
duly executed waiver of the Notice thereof. Special meetings of the Members
may be held for
23
any purpose or purposes, unless otherwise prohibited by law, and may be called
by the Management Committee or by Members owning not less than twenty-five
percent (25%) of the Percentage Interests. Members may participate in a
meeting of the Members by means of conference telephone or other similar
communication equipment whereby all Members participating in the meeting can
hear each other. Participation in a meeting in this manner shall constitute
presence in person at the meeting.
6.2 Quorum; Voting Requirement. The presence, in person, by telephone
or by proxy, of a Majority in Interest of the Members shall constitute a
quorum for the transaction of business by the Members. The affirmative vote
of a Majority in Interest of the Members present, in person, by telephone or
by proxy, at any meeting shall constitute a valid decision of the Members,
except where a larger vote is required by the Act.
6.3 Proxies. At any meeting of the Members, every Member having the
right to vote thereat shall be entitled to vote in person or by proxy
appointed by an instrument in writing signed by such Member and bearing a date
not more than one year prior to such meeting.
6.4 Action Without Meeting. Any action required or permitted to be
taken at any meeting of Members of the Company may be taken without a meeting,
without prior notice and without a vote if a consent in writing setting forth
the action so taken is signed by Members having not less than the minimum
Percentage Interests that would be necessary to authorize or take such action
at a meeting of the Members. Prompt Notice of the taking of any action taken
pursuant to this Section 6.4 by less than the unanimous written consent of the
Members shall be given to those Members who have not consented in writing.
6.5 Notice. Notice stating the place, day and hour of the meeting and
the purpose for which the meeting is called shall be delivered personally or
sent by mail or by telecopier not less than five (5) days nor more than sixty
(60) days before the date of the meeting by or at the direction of the
Management Committee or other persons calling the meeting, to each Member
entitled to vote at such meeting.
6.6 Waiver of Notice. When any Notice is required to be given to any
Member hereunder, a waiver thereof in writing signed by the Member, whether
before, at or after
24
the time stated therein, shall be equivalent to the giving of such Notice.
6.7 No Authority. Unless expressly authorized herein or by action of
the Members or the Management Committee in accordance herewith and the Act, no
Member shall have any authority to act on behalf of the Company or bind the
Company in any manner whatsoever, including, without limitation, entering into
any agreement on behalf of the Company.
ARTICLE 7
MANAGEMENT AND CONTROL
7.1 Management Committee; Managers.
(a) Except as otherwise provided hereunder, the business and affairs of
the Company shall be managed by a Management Committee comprised of up to a
total of up to seven (7) Managers, (i) up to four (4) of whom shall be
designated in writing by a Majority in Interest of the Group A Members (the
four individuals designated pursuant to this clause (i) being referred to
herein collectively as the "Group A Managers" and, individually, as a "Group A
Manager", (ii) up to two (2) individuals designated in writing by a Majority
in Interest of the Group B Members (the two individuals designated pursuant to
this clause (ii) being referred to herein collectively as the "Group B
Managers" and individually as a "Group B Manager, and (iii) one (1) individual
designated in writing by a Majority in Interest of the Group C Members (the
one individual designated by a Majority in Interest of the Group C Members
pursuant to this clause (iii) being referred to as a "Group C Manager"). As
of the date hereof, (i) the Group A Managers designated by the Group A Member
are ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Bank, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
(ii) the Group B Managers designated by the Group B Member are ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and (iii) the Group C Manager designated by
the Group C Members is ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇. Anything herein to the contrary
notwithstanding, so long as ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ continues to be employed as the
Chief Executive Officer of the Company, one of the Managers designated by the
Group B Members as provided in clause (ii) of the first sentence of this
Section 7.1(a) shall be deemed to be ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇.
(b) After the date hereof, (i) a Majority in Interest of the Group A
Members shall be entitled at any time, with
25
or without cause, to designate any Group A Manager for removal as a Manager,
(ii) a Majority in Interest of the Group B Members shall be entitled at any
time with or without cause to designate any Group B Manager for removal as a
Manager except that if ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ is serving as Chief Executive Officer
of the Company, the Group B Members shall only be entitled at any time with or
without cause to designate the other Group B Manager for removal as a Manager,
and (iii) a Majority in Interest of the Group C Members shall be entitled at
any time, with or without cause to designate the Group C Manager as removal as
a Manager. Any Manager designated for removal pursuant to this Section 7.1(b)
shall be deemed removed as a Manager upon receipt by the Company of the Notice
from the appropriate Member or Members designating said Manager for removal.
(c) If at any time a vacancy is created on the Management Committee by
reason of the death, removal or resignation of any Manager, the person to fill
such vacancy, shall be designated as a Manager (i) by a Majority in Interest
of the Group A Members, if the person who has ceased to be a Manager was a
Group A Manager, (ii) by a Majority in Interest of the Group B Members, if the
person who has ceased to be a Manager was a Group B Manager or (iii) by a
Majority in Interest of the Group C Managers, if the person who has ceased to
be a Manager was the Group C Manager.
(d) Except as otherwise expressly provided herein, the power and
authority granted to the Management Committee hereunder shall include all
those necessary or convenient for the furtherance of the purposes of the
Company and shall include the power to make all decisions with regard to the
management, operations, assets, financing and capitalization of the Company.
(e) Anything to the contrary herein notwithstanding, no Manager shall
have any authority to bind the Company or the Management Committee in his
individual capacity in any manner whatsoever, except for such authority as
shall be expressly delegated to a Manager in this Agreement or by the
Management Committee.
(f) The board of directors (or similar governing body) of any subsidiary
of the Company shall be comprised of such members as may be approved by the
Management Committee of the Company.
7.2 Management Committee Meetings; Quorum; Proxies.
26
(a) The Management Committee will establish a regular meeting schedule,
and will use its reasonable best efforts to meet at least once every quarter.
Unless otherwise agreed by a majority of the Managers, meetings of the
Management Committee shall be held in New York, New York or Houston, Texas.
Meetings may be conducted in person, by telephone or in any other manner
agreed to by the Management Committee. Any two (2) Managers may call a
meeting of the Management Committee upon delivery of written or telephonic
Notice at least three (3) Business Days prior to the date of such meeting,
which Notice shall be accompanied by a proposed agenda or statement of purpose
and by copies of all documents, agreements and information to be considered at
such meeting; provided, however, at any such meeting, the Managers may address
any and all business matters which may come before it, whether or not such
items were provided for in the proposed agenda.
(b) A quorum shall exist when at least four (4) of the Managers are
present in person, by telephone or by proxy. Each Manager is entitled to vote
at any meeting of the Management Committee. The vote of a majority of the
Managers present in person, by telephone or by proxy at any meeting of the
Management Committee shall be required for action by the Management Committee.
(c) At each meeting of the Management Committee, every Manager shall be
entitled to vote in person, by telephone or by proxy appointed by instrument
in writing, subscribed by such Manager.
7.3 Management Committee's Authority; Certain Limitations. (a) Except as
expressly set forth herein, the Management Committee shall have the maximum
power and authority with respect to the business and operations of the Company
permitted by law, including, without limitation, the right to cause the
Company to merge or consolidate with, or sell all, or substantially all, of
its asset to any Person.
(b) Notwithstanding the grant of authority to the Management Committee
pursuant to Section 7.3(a) and except as otherwise contemplated in Sections
10.1(a), (b) and (c), the Management Committee shall not authorize the Company
to merge or consolidate with, or sell all, or substantially all, of its assets
to, a Member or an Affiliate or Immediate Family Member of a Member without
the prior written consent of a Majority in Interest of the Members other than
the Member or the Member whose Affiliate(s) or Immediate Family Member(s) is a
party to such transaction.
27
7.4 Officers; Agents. The Management Committee shall have the power to
appoint any Person or Persons as agents (who may be referred to as officers)
to act for the Company with such titles, if any, as the Management Committee
deems appropriate and to delegate to such officers or agents such of the
powers as are granted to the Management Committee hereunder, provided,
however, that without the express approval of the Management Committee, no
officer or agent shall have the authority to take any action (i) outside the
ordinary course of business of the Company or (ii) material to the Company and
its subsidiaries taken as a whole. Any decision or act of an officer
appointed under this Section 7.4 within the scope of the officer's designated
or delegated authority shall control and shall bind the Company. The officers
or agents so appointed may have such titles as the Management Committee shall
deem appropriate, which may include (but need not be limited to) President and
Chief Executive Officer, Senior Vice President, Vice President, Chief
Operating Officer, Chief Financial Officer, Treasurer, Controller or
Secretary. The officers of the Company as of the date hereof are set forth on
Schedule 7.4. Unless the authority of the agent designated as the officer in
question is limited by the Management Committee, any officer so appointed
shall have the same authority to act for the Company as a corresponding
officer of a Delaware corporation would have to act for a Delaware corporation
in the absence of a specific delegation of authority; provided, however, that
without the express approval of the Management Committee, no officer or agent
shall have the authority to take any action (i) outside the ordinary course of
business of the Company or (ii) material to the Company and its subsidiaries
taken as a whole. The Management Committee, in its sole discretion, may by
vote, resolution or otherwise ratify any act previously taken by an officer or
agent acting on behalf of the Company.
7.5 Resignation of a Manager. A Manager may resign from such position
at any time upon giving Notice to the Management Committee.
7.6 Compensation Except as otherwise provided herein, each Manager
shall be entitled to reimbursement from the Company for all reasonable direct
out-of-pocket expenses incurred on behalf of the Company, including
reimbursement for such expenses incurred by such Manager in connection with
attending meetings of the Management Committee, and shall not be entitled to
further compensation except as may be approved by the Management Committee.
28
ARTICLE 8
LIABILITY AND INDEMNIFICATION
8.1 Liability of Members. A Member shall only be liable to make the
payment of its Capital Contribution. No Member, except as otherwise
specifically provided in the Act, shall be obligated to pay any distribution
to or for the account of the Company or any creditor of the Company.
8.2 Indemnification.
(a) The Company shall indemnify and hold harmless each Manager and
Member and their respective Affiliates and all officers, directors, members,
partners, stockholders, managers and employees thereof, and each officer of
the Company and any Person serving in any similar capacity for another Person
affiliated with the Company at the request of the Company (solely for purposes
of this Section 8.2, each such Person being referred to as, a "Company
Affiliate"), from and against any and all losses, claims, demands, costs,
damages, liabilities, expenses of any nature (including reasonable attorneys'
fees and disbursements), judgments, fines, settlements and other amounts
arising from any and all claims, demands, actions, suits or proceedings,
whether civil, criminal, administrative or investigative, in which a Company
Affiliate may be involved, or threatened to be involved, as a party or
otherwise, arising out of or incidental to the business of the Company,
including, without limitation, liabilities under the Federal and state
securities laws, regardless of whether a Company Affiliate continues to be a
Company Affiliate, at the time any such liability or expense is paid or
incurred, if (i) the Company Affiliate acted in good faith and in a manner it
or he reasonably believed to be in, or not opposed to, the interests of the
Company and, with respect to any criminal proceeding, had no reason to believe
its or his conduct was unlawful, and (ii) the Company Affiliate's conduct did
not constitute actual fraud, gross negligence or willful or wanton misconduct.
The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere, or its equivalent,
shall not, in and of itself, create a presumption or otherwise constitute
evidence that the Company Affiliate acted in a manner contrary to that
specified in (i) or (ii) above.
(b) Expenses (including reasonable legal fees and expenses) incurred in
defending any proceeding subject to subsection (a) of this Section 8.2 shall
be paid by the Company in advance of the final disposition of such
29
proceeding upon receipt of a written affirmation by the Company Affiliate of
his or its good faith belief that he or it has met the standard of conduct
necessary for indemnification under this Section 8.2 and a written undertaking
(which need not be secured) by or on behalf of the Company Affiliate to repay
such amount if it shall ultimately be determined, by a court of competent
jurisdiction or otherwise, that the Company Affiliate is not entitled to be
indemnified by the Company as authorized hereunder.
(c) The indemnification provided by this Section 8.2 shall be in
addition to any other rights to which each Company Affiliate may be entitled
under any agreement or vote of the Management Committee by the vote of
Managers that are disinterested and unaffiliated with such Company Affiliate,
as a matter of law or otherwise, both as to action in the Company Affiliate's
capacity as a Company Affiliate or as a Person serving at the request of the
Company and shall continue as to a Company Affiliate who has ceased to serve
in such capacity and shall inure to the benefit of the heirs, successors,
assigns, administrators and personal representatives of such Company
Affiliate.
(d) The Company may purchase and maintain directors and officers
insurance or, similar coverage, for its Managers and its officers in such
amounts and with such deductibles or self-insured retentions as are customary
for Persons engaged in businesses similar in size and type to those engaged in
by the Company.
(e) Except as provided in Section 3.4, any indemnification hereunder
shall be satisfied only out of the assets of the Company and the Members shall
not be subject to personal liability by reason of these indemnification
provisions. To the extent the Company does not have adequate cash available
to satisfy its obligations under this Article 8, the Company shall pay its
obligations under this Article 8 out of Net Cash Flow prior to making any
distributions (other than distributions under Section 4.1(a) hereof) to the
Members.
(f) A Company Affiliate shall not be denied indemnification in whole or
in part under this Section 8.2 because the Company Affiliate had an interest
in the transaction with respect to which the indemnification applies if the
transaction was otherwise permitted by the terms of this Agreement and all
material facts relating to such indemnitee's interest were adequately
disclosed to the
30
Management Committee at the time the transaction was consummated.
(g) The provisions of this Section 8.2 are for the benefit of the
Company Affiliates and the heirs, successors, assigns, administrators and
personal representatives of the Company Affiliates and shall not be deemed to
create any rights for the benefit of any other Persons.
(h) Any repeal or amendment of any provisions of this Section 8.2 shall
be prospective only and shall not adversely affect any Company Affiliates's
right existing at the time of such repeal or amendment.
ARTICLE 9
TRANSFERS OF MEMBERSHIP INTERESTS
9.1 General Restrictions.
(a) No Member may Transfer all or any part of such Member's Membership
Interest, except as provided in this Agreement. Any purported Transfer or
purported purchase of a Membership Interest or a portion thereof in violation
of the terms of this Agreement shall be null and void and of no effect. A
permitted Transfer shall be effective as of the date specified in the
instruments relating thereto. Any transferee desiring to make a further
Transfer shall become subject to all the provisions of this Article 9 to the
same extent and in the same manner as any Member desiring to make any
Transfer. No Member shall have the right to withdraw as a Member of the
Company.
(b) In the event that the Membership Interests (or securities issued in
exchange for Membership Interests upon conversion of the Company into a
corporation) are registered under the Securities Act, the Transfer
restrictions set forth in this Article 9 shall terminate.
31
9.2 Permitted Transferees.
(a) Notwithstanding the provisions of Section 9.8 and 9.9, each Member
that is a natural person shall have the right to Transfer (but not to
substitute the transferee as a substitute Member in such Member's place,
except in accordance with Section 9.3), by a written instrument, all or any
part of such Member's Membership Interest, to an Immediate Family Member; it
being understood that any such Permitted Transferee shall be deemed to be an
additional or substitute Member as of the date of such Transfer and each
Member agrees to take such action and execute such documents as such
transferee may deem reasonably necessary and appropriate for such transferee
to become a substitute or additional Member.
(b) Notwithstanding the provisions of Sections 9.8 and 9.9, each Member
that is not a natural Person (other than COI) shall have the right to Transfer
(but not to substitute the transferee as a substitute Member in such Member's
place, except in accordance with Section 9.3), by a written instrument, all or
any part of a Member's Membership Interest, to any of its Affiliates; it being
understood that any such Permitted Transferee shall be deemed to be an
additional or substitute Member as of the date of such Transfer and each
Member agrees to take such action and execute such documents as such
transferee may deem reasonably necessary and appropriate for such transferee
to become a substitute or additional Member.
(c) Notwithstanding the provisions of Sections 9.8 and 9.9, COI shall
have the right to Transfer (but not to substitute the transferee as a
substitute Member in COI's place, except in accordance with Section 9.3), by a
written instrument, all of its Membership Interest, to its members pro rata in
accordance with their percentages of membership interests set forth on
Schedule 2; it being understood that each such Permitted Transferee shall be
deemed an additional or substitute Member as of the date of such Transfer and
each Member agrees to take such action and execute such documents as such
transferee may deem reasonably necessary and appropriate for such transferee
to become a substitute or additional Member.
(d) Notwithstanding the provisions of Sections 9.8 and 9.9, a Member
shall have the right to pledge such Member's Membership Interest, in whole or
in part, to a financial institution as collateral security for a loan to such
Member by such financial institution so long as the Management
32
Committee has given its prior written consent to said pledge, which consent
shall not be unreasonably withheld; provided, however, that no such pledge
shall be made for the purpose of effecting a disguised sale to the pledgee
and; provided further, that any such pledgee or a transferee of such pledgee,
as appropriate, shall agree in a writing delivered to the Company to be bound
by all of the terms and conditions of this Agreement.
(e) Unless and until admitted as a substitute Member pursuant to
Section 9.3, a transferee of a Member's Membership Interest in whole or in
part shall be an assignee with respect to such Transferred Membership Interest
and shall not be entitled to participate in the management of the business and
affairs of the Company or to become or to exercise the rights of a Member,
including the right to vote, the right to require any information or
accounting of the Company's business or the right to inspect the Company's
books and records. Such transferee shall only be entitled to receive, to the
extent of the Membership Interest transferred to such transferee, the share of
distributions and profits, including distributions representing the return of
Capital Contributions, to which the transferor would otherwise be entitled
with respect to the Transferred Interest. The transferror shall have the
right to vote such Transferred Interest until the transferee is admitted to
the Company as a substituted Member with respect to the Transferred Interest.
9.3 Substitute Members. No transferee of all or part of a Member's
Membership Interest shall become a substitute Member in place of the
transferor unless and until:
(a) the transferee has executed an instrument in form and substance
reasonably satisfactory to the Management Committee accepting and
adopting the terms and provisions of the Certificate and this Agreement;
and
(b) the transferee has caused to be paid all reasonable expenses of
the Company in connection with the admission of the transferee as a
substitute Member.
Upon satisfaction of all the foregoing conditions with respect to a
particular transferee, the President and Chief Executive Officer shall cause
the books and records of the Company to reflect the admission of the
transferee as a substitute Member to the extent of the Transferred Interest
held by the transferee.
33
9.4 Effect of Admission as a Substitute Member. A transferee who has
become a substitute Member has, to the extent of the transferred Membership
Interest, all the rights, powers and benefits of, and is subject to the
restrictions and liabilities of a Member under the Certificate, this Agreement
and the Act. Upon admission of a transferee as a substitute Member, the
transferor of the Membership Interest so held by the substitute Member shall
cease to be a Member of the Company to the extent of such transferred
Membership Interest.
9.5 Consent. Each Member hereby agrees that upon satisfaction of the
terms and conditions of this Article 9 with respect to any proposed Transfer,
the Person proposed to be such transferee may be admitted as a Member.
9.6 No Dissolution. If a Member transfers all of its Membership
Interest pursuant to this Article 9 and the transferee of such Membership
Interest is admitted as a Member pursuant to Section 9.3, such Person shall be
admitted to the Company as a Member effective on the effective date of the
Transfer or such other date as may be specified when the Member is admitted.
In such event, the Company shall not dissolve if the business of the Company
is continued without dissolution in accordance with clause (c) of Section 10.1
hereof.
9.7 Additional Members; Certain Representations of Members. Subject to
Section 3.6, from and after the date hereof, any Person acceptable to the
Management Committee may become an additional Member of the Company for such
consideration as the Management Committee shall determine, provided that such
additional Member complies with all the requirements of a transferee under
Sections 9.3(a) and (b).
9.8 Right of First Offer.
(a) If at any time any Member (hereinafter for purposes of this Section
9.8, the "Section 9.8 Selling Members") proposes to Transfer to any Person
other than a Permitted Transferee (hereinafter for purposes of this Section
9.8, the "Section 9.8 Proposed Purchaser") its Membership Interest (or any
portion thereof), such Section 9.8 Selling Member shall provide Notice of the
proposed Transfer to the other Members (hereinafter for purposes of Section
9.8, the "Section 9.8 Offerees") setting forth the price, terms and conditions
of the proposed sale of the Membership Interest. Each of the Section 9.8
Offerees shall have the option to acquire such Member's pro rata portion
(which shall be in
34
proportion to the Percentage Interests of all Section 9.8 Offerees) at the
time of such Notice on the terms and conditions set forth in such Notice. The
option of Section 9.8 Offerees to purchase their pro rata portions of the
Membership Interest shall be exercised by delivery of a Notice to the Section
9.8 Selling Member and the Company of exercise within twenty (20) days
following receipt of the Section 9.8 Selling Member's Notice of the price,
terms and conditions of the sale. A Section 9.8 Offeree may exercise such
Member's option to purchase such Membership Interest only as to the entire
portion thereof that such Member is entitled to purchase. If any Section 9.8
Offeree fails or declines to purchase such Member's pro rata portion of such
Membership Interest, then such Member's portion of such Membership Interest
shall be offered to the Section 9.8 Offerees who have exercised their options
to purchase their pro rata portions. This procedure shall continue until such
time as the entire Membership Interest offered hereby has been purchased by
such Section 9.8 Offerees or until no such Member desires to purchase any
additional Membership Interest hereunder. Each Section 9.8 Offeree shall have
the right to offer to acquire such Membership Interest by delivering to the
Section 9.8 Selling Member and the Company such Member's Notice of acceptance
within five (5) Business Days following receipt of the Company's Notice that
additional portions are available. If less than the entire Membership
Interest to be sold by the Section 9.8 Selling Member is to be purchased by
the Section 9.8 Offerees, the Section 9.8 Selling Member may sell the entire
Membership Interest to be sold within sixty (60) days from the Notice referred
in the preceding sentence, upon terms and conditions no less favorable to the
Section 9.8 Selling Member than were set forth in the initial Notice (it being
understood that such terms may include the receipt by the Selling Member of
consideration consisting of only cash and/or securities with a readily
ascertainable market value).
(b) The sale of any Membership Interest to Section 9.8 Offerees who
exercise their options to purchase any Membership Interest shall occur twenty-
one (21) days after the expiration of the last option to expire under Section
9.8(a) above. At the closing, each of the Section 9.8 Offerees shall deliver
a certified or bank cashier's check in, or wire transfer immediately available
funds in the appropriate amount to the Section 9.8 Selling Member against the
simultaneous delivery of an assignment in form and substance reasonably
satisfactory to each Section 9.8 Offeree of the Member Interest (or portion
thereof) being
35
transferred to such Section 9.8 Offeree, such assignment shall be made free
and clear of all liens, claims and encumbrances, except as provided by this
Agreement or as otherwise agreed to by such Section 9.8 Offeree; provided,
however, that each such Section 9.8 Selling Member shall not be required to
make any other representations or warranties in connection with such sale
except that it has the authority to sell its Membership Interest, is the sole
owner of such Membership Interest and has good and valid title to such
Membership Interest and that the sale of its Membership Interest does not
violate any agreement to which it is a party or by which it is bound.
9.9 Tag-Along Rights. (a) In the event of any proposed Transfer in any
one transaction or in a series of related transactions by any Member or
Members (hereinafter for purposes of this Section 9.9, collectively, the
"Section 9.9 Selling Member") of its or their Membership Interests
constituting in the aggregate twenty percent (20%) or more of all the
Membership Interests to any Person (such Person being hereinafter referred to
as the "Section 9.9 Proposed Purchaser"), other than to a Permitted Transferee
or in a bona fide public distribution pursuant to an effective Registration
Statement under the Securities Act, each of the other Members (hereinafter for
purposes of this Section 9.9, the "Section 9.9 Tagged Members") shall have the
irrevocable and exclusive right, but not the obligation (the "Tag-Along
Right"), to require the Section 9.9 Proposed Purchaser to purchase from each
of them such Section 9.9 Tagged Member's pro rata portion (i.e., such Tagged
Member's Percentage Interest) of the Membership Interests proposed to be sold
by the Section 9.9 Selling Members to the Section 9.9 Proposed Purchaser
(collectively, the "Section 9.9 Tag-Along Membership Interest"). The Section
9.9 Selling Members shall give Notice (the "Initial Tag-Along Notice") to the
Section 9.9 Tagged Members at least thirty (30) days prior to the date of the
proposed Transfer and at least three (3) Business Days after the expiration of
the last option to expire under Section 9.8(a) above, stating:
(i) the name and address of the Section 9.9 Proposed Purchaser;
(ii) the proposed amount of consideration and terms and conditions
of payment offered by such Section 9.9 Proposed Purchaser (if the
proposed consideration is not cash, the Notice shall describe the terms
of the proposed consideration) and any other material terms and
conditions of the Section 9.9 Proposed Purchaser's offer;
36
(iii) the Membership Interest proposed to be transferred; and
(iv) that the Section 9.9 Proposed Purchaser has been informed of
the Tag-Along Right and has agreed to purchase Membership Interests in
accordance with the terms hereof.
The Tag-Along Right shall be exercised by any or all of the Section 9.9
Tagged Members by giving Notice to the Company ("Tag-Along Notice") with a
copy to each Section 9.9 Selling Member, within five (5) days following
receipt of the Initial Tag-Along Notice, indicating its election to exercise
the Tag-Along Right (hereinafter referred to for purposes of this Section 9.9,
the "Section 9.9 Participating Tagged Members"). The Tag-Along Notice shall
state the amount of Membership Interests that such Section 9.9 Participating
Tagged Member proposes to include in such transfer to the Section 9.9 Proposed
Purchaser. Failure by any Section 9.9 Tagged Member to give such Tag-Along
Notice within such 5 day period shall be deemed an election by such Section
9.9 Tagged Member not to sell its Membership Interests pursuant to the Initial
Tag-Along Notice. The closing with respect to any sale to a Section 9.9
Proposed Purchaser pursuant to this Section shall be held at the time and
place specified in the Initial Tag-Along Notice but in any event within sixty
(60) days of the date the Initial Tag-Along Notice is given. Consummation of
the sale of Membership Interests by any Section 9.9 Selling Member to a
Section 9.9 Proposed Purchaser shall be conditioned upon consummation of the
sale by each Section 9.9 Participating Tagged Member to such Section 9.9
Proposed Purchaser of the Section 9.9 Tag-Along Membership Interest, if any.
(b) In the event that the Section 9.9 Proposed Purchaser does not
purchase the Section 9.9 Tag-Along Membership Interest from the Section 9.9
Participating Tagged Members on the same terms and conditions as purchased
from the Section 9.9 Selling Member, then the Section 9.9 Selling Member
making such Transfer shall purchase on such terms and conditions such Section
9.9 Tag-Along Membership Interest if the Transfer occurs.
(c) The Section 9.9 Selling Members who are parties to a sale to a
Section 9.9 Proposed Purchaser shall arrange for payment (by bank cashier's
check or certified check or by wire transfer of immediately available funds)
directly by the Section 9.9 Proposed Purchaser to each Section 9.9
Participating Tagged Member, upon delivery of an appropriate
37
assignment in form and substance reasonably satisfactory to the Section 9.9
Proposed Purchaser, which assignment shall be made free and clear of all
liens, claims and encumbrances except as provided by this Agreement or as
otherwise agreed to by such Section 9.9 Proposed Purchaser; provided, however,
that each such Section 9.9 Participating Tagged Member shall not be required
to make any other representations or warranties in connection with such sale
except that it has the authority to sell its Membership Interest, is the sole
owner of such Membership Interest and has good and valid title to such
Membership Interest and that the sale of its Membership Interest does not
violate any agreement to which it is a party or by which it is bound.
(d) If at the end of 60 days following the date on which an Initial Tag-
Along Notice was given, the sale of Membership Interests by the Section 9.9
Selling Members and the sale of the Section 9.9 Tag-Along Membership Interests
have not been completed in accordance with the terms of the Section 9.9
Proposed Purchaser's offer, all the restrictions on sale, transfer or
assignment contained in this Agreement with respect to Membership Interests
owned by the Members shall again be in effect.
9.10 Drag-Along Rights.
(a) In the event of any proposed Transfer of Membership Interest
constituting a majority of all Membership Interests by any Member or Members
(hereinafter for purposes of this Section 9.10, collectively a "Section 9.10
Selling Members") of all of its or their Membership Interest to a Person (such
Person being hereinafter referred to as the "Section 9.10 Proposed
Purchaser"), other than a Permitted Transferee or in a bona fide public
distribution pursuant to an effective Registration Statement under the
Securities Act, such Section 9.10 Selling Members shall have the right (the
"Drag-Along Right"), to require each other Member (hereinafter for purposes of
this Section 9.10, the "Section 9.10 Dragged Members") to Transfer to the
Section 9.10 Proposed Purchaser each such Section 9.10 Dragged Member's entire
Membership Interest (such Membership Interests as may be required to be so
Transferred being hereinafter referred to as the "Section 9.10 Drag-Along
Membership Interests"). The Section 9.10 Selling Members shall exercise their
Drag-Along Right by giving Notice (the "Drag-Along Notice") to each Section
9.10 Dragged Member at least twenty (20) days prior to the date of the
proposed Transfer and at least
38
three (3) Business Days after the expiration of the last option to expire
under Section 9.8(a) above, stating:
(i) the name and address of the Section 9.10 Proposed Purchaser;
(ii) the proposed amount of consideration and terms and conditions
of payment offered by such Section 9.10 Proposed Purchaser (if the
proposed consideration is not cash, the notice shall describe the terms
of the proposed consideration);
(iii) the Membership Interests proposed to be transferred; and
(iv) that the Section 9.10 Proposed Purchaser has been informed of
the Drag-Along Right and has agreed to purchase Membership Interests in
accordance with the terms hereof.
The closing with respect to any sale to a Section 9.10 Proposed Purchaser
pursuant to this Section shall be held at the time and place specified in the
Drag-Along Notice but in any event within sixty (60) days of the date the
Drag-Along Notice is given. Consummation of the sale of Membership Interests
by any Member to a Section 9.10 Proposed Purchaser shall be conditioned upon
consummation of the sale by each Section 9.10 Selling Member to such Section
9.10 Proposed Purchaser of the Membership Interests proposed to be sold by the
Section 9.10 Selling Members.
(b) In the event that the Section 9.10 Proposed Purchaser does not
purchase the Section 9.10 Drag-Along Membership Interests from the Section
9.10 Dragged Members on the same terms and conditions as purchased from the
Section 9.10 Selling Members, then such Section 9.10 Dragged Members shall
have the right to require the Company to cause the Section 9.10 Selling
Members making such Transfer to purchase on such terms and conditions such
Section 9.10 Drag-Along Membership Interests if the Transfer occurs.
(c) The Section 9.10 Selling Members who are parties to a sale to a
Section 9.10 Proposed Purchaser shall arrange for payment directly by the
Section 9.10 Proposed Purchaser to each Section 9.10 Dragged Member, upon
delivery of the an appropriate assignment in form and substance reasonably
satisfactory to the Section 9.10 Proposed Purchaser, which assignment shall be
made free and clear of all liens, claims and encumbrances, except as provided
by this Agreement or as
39
otherwise agreed to by such Section 9.10 Proposed Purchaser; provided,
however, that each such Dragged Stockholder shall not be required to make any
other representations or warranties in connection with such sale except that
it has the authority to sell its Membership Interest, is the sole owner of
such Shares and has good and valid title to such Membership Interest, and that
the sale of such Membership Interest does not violate any agreement to which
it is a party or by which it is bound.
(d) If at the end of 60 days following the date on which a Drag-Along
Notice was given, the sale of Membership Interests by the Section 9.10 Selling
Members and the sale of the Section 9.10 Drag-Along Membership Interests have
not been completed in accordance with the terms of the Drag-Along Notice, all
the restrictions on sale, transfer or assignment contained in this Agreement
with respect to Membership Interests owned by the Section 9.10 Selling Members
shall again be in effect.
9.11 Piggyback Registration.
(a) For the purposes of this Section 9.11, the following capitalized
terms shall have the following meanings:
(i) "Common Stock" shall mean the common stock of the Company
issued upon conversion of the Company to a corporation;
(ii) "Other Shares" shall mean at any time those shares of Common
Stock or other securities of the Company which do not constitute Primary
Shares or Registrable Shares;
(iii) "Primary Shares" shall mean at any time authorized but
unissued shares of Common Stock or shares of Common Stock held by the
Company in its treasury;
(iv) "Registrable Shares" shall mean the shares of Common Stock held
by the Members in the Company which constitute Restricted Shares and
which are not then eligible for sale to the public pursuant to Rule 144
(other than Rule 144(k)) in a single transaction (and including
Membership Interests held by Members prior to the conversion of the
Company to a corporation).
(v) "Restricted Shares" shall mean any Membership Interests, shares
of Common Stock or other securities
40
received in respect thereof held or which may be acquired from the
Company by the Members as of the applicable date, and which theretofore
have not been sold to the public pursuant to a registration statement
under the Securities Act or pursuant to Rule 144; and
(vi) "Rule 144" shall mean Rule 144 promulgated under the Securities
Act or any successor rule thereto or any complementary rule thereto (such
as Rule 144A).
(b) If the Company at any time proposes for any reason to register
Primary Shares or Other Shares under the Securities Act (other than on Form S-
4 or Form S-8 promulgated under the Securities Act or any successor forms
thereto), it shall promptly give Notice to the Members of its intention so to
register the Primary Shares or Other Shares and, upon the written request,
given within 30 days after delivery of any such Notice by the Company, of the
Members to include in such registration Registrable Shares (which request
shall specify the number of Registrable Shares proposed to be included in such
registration), the Company shall use its best efforts to cause all such
Registrable Shares to be included in such registration on the same terms and
conditions as the securities otherwise being sold in such registration;
provided, however, that if the managing underwriter advises the Company that
the inclusion of all Registrable Shares or Other Shares proposed to be
included in such registration would interfere with the successful marketing
(including pricing) of Primary Shares proposed to be registered by the
Company, then the number of Primary Shares, Registrable Shares and Other
Shares proposed to be included in such registration shall be included in the
following order:
(i) first, the Primary Shares; and
(ii) second, the Registrable Shares and Other Shares requested to be
included in such registration pro rata, based upon the respective numbers
of Restricted Shares owned at the time by each Member and the respective
numbers of Other Shares owned at the time by each holder of Other Shares.
(c) If at any time after giving Notice pursuant to this Section 9.11 of
its intention to register any securities and prior to the effective date of
the registration statement filed in connection with such registration, the
Company shall determine for any reason either not to register or to delay
registration of such
41
securities, the Company may, at its election, give Notice of such
determination to the Members and, thereupon, (i) in the case of a
determination not to register, shall be relieved of its obligation to register
any Registrable Securities in connection with such registration and (ii) in
the case of a determination to delay registering, shall be permitted to delay
registering any Registerable Securities, for the same period as the delay in
registering such other securities.
(d) If a registration under this Section 9.11 involves an underwritten
offering, the underwriter or underwriters and any additional investment
bankers and managers to be used in connection with such registration shall be
selected by the Company, and any Member desiring to have Registrable Shares
included in such registration, and any such Investor shall be required to sign
an underwriting agreement in customary form with such underwriter or
underwriters.
9.12 Additional Members; Certain Representations of Members.
(a) Subject to Section 3.6, any Person acceptable to the Management
Committee may become an additional Member of the Company for such
consideration as the Management Committee shall determine, provided that such
additional Member complies with all the requirements of a transferee under
Section 9.3.
(b) Each of COI and SEACOR hereby represents to the Company that, as of
the date hereof, its outstanding membership interests or issued and
outstanding shares of capital stock, as the case may be, are as set forth on
Schedule 2 and such membership interests or shares, as the case may be, are
owned beneficially and of record by the Persons identified on such Schedule.
(c) In order to prevent any direct transfer of interests in the Company,
each of COI and SEACOR acknowledge and confirms that each of its members or
stockholders, as the case may be, agreed to certain transfer restrictions with
respect to the transfer of such Person's membership interests or shares of COI
or SEACOR, as the case may be, by executing and delivering to the Company a
letter agreement dated August 5, 1997.
42
ARTICLE 10
DISSOLUTION AND TERMINATION
10.1 Events Causing Dissolution. The Company shall be dissolved and its
affairs wound up upon the first to occur of the following events:
(a) The vote to dissolve Members holding not less than ninety
percent (90%) of the Membership Interests;
(b) The sale, Transfer or other disposition of substantially all of
the assets of the Company and the receipt and distribution of all the
proceeds therefrom;
(c) The death, retirement, resignation, insanity, expulsion,
bankruptcy or dissolution of a Member, or any other event which
terminates the continued membership of a Member in the Company, unless
there is at least one remaining Member;
(d) The entry of a decree of judicial dissolution pursuant to
Section 18-802 of the Act; or
(e) The expiration of the term of the Company as provided in Section
2.5.
10.2 Notices to Secretary of State. When all the remaining property and
assets of the Company have been distributed, the Certificate shall be
cancelled by filing a certificate of cancellation with the Secretary of State
of Delaware.
10.3 Cash Distributions Upon Dissolution. Upon the dissolution of the
Company as a result of the occurrence of any of the events set forth in
Section 10.1, the Management Committee shall proceed to wind up the affairs of
and liquidate the Company and any cash and proceeds therefrom shall be applied
and distributed in the following order of priority:
(a) First, to the payment (or the making of reasonable provision
for payment) of debts and liabilities of the Company in the order of
priority as provided by law (including any loans or advances that may
have been made by any of the Members to the Company) and the expenses of
43
liquidation including the establishment of any Reserves which the
Management Committee may reasonably deem necessary for any contingent,
conditional or unasserted claims or obligations of the Company. Such
Reserves may be paid over by the Company to an escrow agent to be held
for disbursement in payment of any of the aforementioned liabilities and,
at the expiration of such period as shall be reasonably deemed advisable
by the Management Committee, for distribution of the balance in the
manner provided in this Article 10;
(b) Finally, the remaining balance, if any, to the Members in
proportion to their respective positive Capital Accounts, after giving
effect to all contributions, distributions and allocations for all
periods, in accordance with the requirements of Regulation Section
1.704-1(b)(2)(ii)(b)(2).
10.4 In-Kind. Notwithstanding the foregoing but subject to Section 18-
804(a)(1) of the Act, in the event the Management Committee shall determine
that an immediate sale of part of or all the Property would cause undue loss
to the Members, or the Management Committee determines that it would be in the
best interest of the Members to distribute the Property to the Members in-kind
(which distributions do not, as to the in-kind portions, have to be in the
same proportions as they would be if cash were distributed, but all such in-
kind distributions shall be equalized, to the extent necessary, with cash),
then the Management Committee may either defer liquidation of, and withhold
from distribution for a reasonable time, any of the Property except that
necessary to satisfy the Company's debts and obligations, or distribute the
Property to the Members in-kind.
10.5 No Action for Dissolution. The Members acknowledge that irreparable
damage would be done to the goodwill and reputation of the Company if any
Member should bring an action in court to dissolve the Company under
circumstances where dissolution is not required by Section 10.1. Accordingly,
except where the Managers have failed to liquidate the Company as required by
Section 10.1 and except as specifically provided in Section 18-802 and Section
18-803(a) of the Act, each Member hereby to the fullest extent permitted by
law waives and renounces his right to initiate legal action to seek
dissolution of the Company or
44
to seek the appointment of a receiver or trustee to wind up the affairs of the
Company, except in the cases of fraud, violation of law, bad faith, gross
negligence, willful misconduct or willful violation of this Agreement.
ARTICLE 11
TAX MATTERS MEMBER
11.1 Tax Matters Member. SEACOR shall be the initial Tax Matters Member
of the Company as provided in the Regulations under Section 6231 of the Code
and analogous provisions of state law. The Management Committee shall have
the authority to remove or replace (following death or resignation) the Tax
Matters Member of the Company and designate its successor.
11.2 Certain Authorizations. The Tax Matters Member shall represent the
Company, at the Company's expense, in connection with all examinations of the
Company's affairs by tax authorities including any resulting administrative or
judicial proceedings. Without limiting the generality of the foregoing, and
subject to the restrictions set forth herein, the Tax Matters Member, but only
with the consent or approval or at the director of the Management Committee,
is hereby authorized:
(a) to enter into any settlement with the Secretary with respect to
any tax audit or judicial review, in which agreement the Tax Matters
Member may expressly state that such agreement shall bind the other
Members except that such settlement agreement shall not bind any Member
that has not approved such settlement agreement in writing;
(b) if a notice of a final administrative adjustment at the Company
level of any item required to be taken into account by a Member for tax
purposes is mailed to the Tax Matters Member, to seek judicial review of
such final adjustment, including the filing of a petition for
readjustment with the Tax Court, the District Court of the United States
for the district in which the Company's principal place of business is
located, or elsewhere as allowed by law, or the United States Claims
Court;
45
(c) to intervene in any action brought by any other Member for
judicial review of a final adjustment;
(d) to file a request for an administrative adjustment with the
Secretary at any time and, if any part of such request is not allowed by
the Secretary, to file a petition for judicial review with respect to
such request;
(e) to enter into an agreement with the Internal Revenue Service to
extend the period for assessing any tax that is attributable to any item
required to be taken into account by a Member for tax purposes, or an
item affected by such item; and
(f) to take any other action on behalf of the Members (with respect
to the Company) or the Company in connection with any administrative or
judicial tax proceeding to the extent permitted by applicable law or the
Regulations.
Each Member shall have the right to participate in any such actions and
proceedings to the extent provided for under the Code and Regulations.
11.3 Indemnity of Tax Matters Member. To the maximum extent permitted by
applicable law and without limiting Article 8, the Company shall indemnify and
reimburse the Tax Matters Member for all expenses (including reasonable legal
and accounting fees) incurred as Tax Matters Member pursuant to this Article
11 in connection with any administrative or judicial proceeding with respect
to the tax liability of the Members as long as the Tax Matters Member has
determined in good faith that the Tax Matters Member's course of conduct was
in, or not opposed to, the best interest of the Company. The taking of any
action and the incurring of any expense by the Tax Matters Member in
connection with any such proceeding, except to the extent provided herein or
required by law, is a matter in the sole discretion of the Tax Matters Member.
11.4 Information Furnished. To the extent and in the manner provided by
applicable law and Regulations, the Tax Matters Member shall furnish the name,
address, profits and loss interest, and taxpayer identification number of each
Member to the Internal Revenue Service.
46
11.5 Notice of Proceedings, etc. The Tax Matters Member shall use best
efforts to keep each Member informed of any administrative and judicial
proceedings for the adjustment at the Company level of any item required to be
taken into account by a Member for income tax purposes or any extension of the
period of limitations for making assessments of any tax against a Member with
respect to any Company item, or of any agreement with the Internal Revenue
Service that would result in any material change either in Income or Loss as
previously reported.
11.6 Notices to Tax Matters Member. Any Member that receives a notice of
an administrative proceeding under Section 6233 of the Code relating to the
Company shall promptly provide Notice to the Tax Matters Member of the
treatment of any Company item on such Member's Federal income tax return that
is or may be inconsistent with the treatment of that item on the Company's
return. Any Member that enters into a settlement agreement with the Internal
Revenue Service or any other government agency or official with respect to any
Company item shall provide Notice to the Tax Matters Member of such agreement
and its terms within sixty (60) days after its date.
11.7 Preparation of Tax Returns. The Tax Matters Member shall arrange
for the preparation and timely filing of all returns of Company income, gains,
deductions, losses and other items necessary for Federal, state and local
income tax purposes and shall use all reasonable efforts to furnish to the
Members within ninety (90) days of the close of the taxable year a Schedule K-
1 and such other tax information reasonably required for Federal, state and
local income tax reporting purposes. The classification, realization and
recognition of income, gain, losses and deductions and other items shall be on
the cash or accrual method of accounting for Federal income tax purposes, as
the Management Committee shall determine in its sole discretion in accordance
with applicable law.
11.8 Tax Elections. The Management Committee shall, in its sole
discretion, determine whether to make any available election.
11.9 Taxation as a Partnership. The Members hereby agree that the
Company shall be treated as a partnership for tax purposes under United States
federal, state and local income tax laws or other laws, and further agree not
to take any position or take any action inconsistent therewith, in a tax
return or otherwise. No
47
election shall be made by the Company or any Member for the Company to be
excluded from the application of any of the provisions of Subchapter K,
Chapter I of Subtitle A of the Code or from any similar provisions of any
state tax laws or to be treated as a corporation for federal tax purposes.
ARTICLE 12
ACCOUNTING AND BANK ACCOUNTS
12.1 Fiscal Year and Accounting Method. The fiscal year and taxable year
of the Company shall be as designated by the Management Committee in
accordance with the Code. The Company shall use an accrual method of
accounting.
12.2 Books and Records. The Company shall maintain at its principal
office, or such other office as may be determined by the Management Committee,
all the following:
(a) A current list of the full name and last known business or
residence address of each Member together with information regarding the
amount of cash and a description and statement of the agreed value of any
other property or services contributed by each Member and which each
Member has agreed to contribute in the future, and the date on which each
Member became a Member of the Company;
(b) A copy of the Certificate and this Agreement, including any and
all amendments to either thereof, together with executed copies of any
powers of attorney pursuant to which the Certificate, this Agreement, or
any amendments have been executed;
(c) Copies of the Company's Federal, state, and local income tax or
information returns and reports, if any, which shall be retained for at
least six fiscal years;
(d) The financial statements of the Company, which shall be
retained for at least six fiscal years; and
(e) The Company's books and records, which shall be retained for at
least six fiscal years.
48
12.3 Delivery to Members; Inspection. Upon the request of any Member,
for any purpose reasonably related to such Member's interest as a member of
the Company, the Management Committee shall cause to be made available to the
requesting Member the information required to be maintained by clauses (a)
through (d) of Section 12.2 and such other information regarding the business
and affairs of the Company as any Member may reasonably request. Upon the
giving of ten (10) days' prior Notice to the Company, any Member or its
authorized representatives and advisors shall have the right to inspect the
books and records of the Company at the offices of the Company during normal
business hours.
12.4 Financial Statements. The Management Committee shall cause to be
prepared for the Members at least annually, at the Company's expense,
financial statements of the Company, and its subsidiaries, prepared in
accordance with generally accepted accounting principles and audited by ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ & Co., LLP, or another nationally recognized accounting firm. The
financial statements so furnished shall include a balance sheet, statement of
income or loss, statement of cash flows, and statement of Members' equity. In
addition, the Management Committee shall provide on a timely basis to the
Members quarterly financials, statements of cash flow, any available internal
budgets or forecast or other available financial reports, as well as any
reports or notices as are provided by the Company, or any of its subsidiaries
to any financial institution.
12.5 Filings. At the Company's expense, the Management Committee shall
cause the income tax returns for the Company to be prepared and timely filed
with the appropriate authorities and to have prepared and to furnish to each
Member such information with respect to the Company as is necessary (or as may
be reasonably requested by a Member) to enable the Members to prepare their
Federal, state and local income tax returns. The Management Committee, at the
Company's expense, shall also cause to be prepared and timely filed, with
appropriate Federal, state and local regulatory and administrative bodies, all
reports required to be filed by the Company with those entities under then
current applicable laws, rules, and regulations. The reports shall be
prepared on the accounting or reporting basis required by the regulatory
bodies.
49
12.6 Non-Disclosure. Each Member agrees that, except as otherwise
consented to by the Management Committee in writing, all non-public and
confidential information furnished to it pursuant to this Agreement will be
kept confidential and will not be disclosed by such Member, or by any of its
agents, representatives, or employees, in any manner whatsoever, in whole or
in part, except that (a) each Member shall be permitted to disclose such
information to those of its agents, representatives, and employees who need to
be familiar with such information in connection with such Member's investment
in the Company, so long as such agents, representatives and employees agree to
keep such information confidential on the terms set forth herein, (b) each
Member shall be permitted to disclose such information to its partners,
stockholders and affiliates so long as they agree to keep such information
confidential on the terms set forth herein, (c) each Member shall be permitted
to disclose information to the extent required by law, legal process or
regulatory requirements, so long as such Member shall have used its reasonable
efforts to first afford the Company with a reasonable opportunity to contest
the necessity of disclosing such information, (d) each Member shall be
permitted to disclose such information to possible purchasers of all or a
portion of the Member's Interest, provided that such prospective purchaser
shall execute a suitable confidentiality agreement containing terms not less
restrictive than the terms set forth herein, and (e) each Member shall be
permitted to disclose information to the extent necessary for the enforcement
of any right of such Member arising under this Agreement.
12.7 Bank Accounts. All funds of the Company shall be deposited in a
separate bank, money market or similar account(s) approved by the Management
Committee and in the Company's name. Withdrawals therefrom shall be made only
by Persons authorized to do so by the Management Committee.
ARTICLE 13
MISCELLANEOUS
13.1 Title to Property. Title to the Property shall be held in the name
of the Company. No Member shall individually have any ownership interest or
rights in the Property except indirectly by virtue of such Member's ownership
of a Membership Interest.
50
13.2 Waiver of Default. No consent or waiver, express or implied, by the
Company or a Member with respect to any breach or default by the Company or a
Member hereunder shall be deemed or construed to be a consent or waiver with
respect to any other breach or default by any party of the same provision or
any other provision of this Agreement. Failure on the part of the Company or
a Member to complain of any act or failure to act of the Company or a Member
or to declare such party in default shall not be deemed or constitute a waiver
by the Company or the Member of any rights hereunder.
13.3 Amendment.
(a) Except as otherwise expressly provided elsewhere in this Agreement,
this Agreement shall not be altered, modified or changed except by an
amendment approved by Members holding not less than ninety percent (90%) of
the Membership Interests.
(b) In addition to any amendments otherwise authorized herein, the
Manager or Management Committee may make any amendments to any of the
Schedules to this Agreement from time to time to reflect transfers of
Membership Interests and issuances of additional Membership Interests. Copies
of such amendments shall be delivered to the Members upon execution thereof.
(c) The Managers shall cause to be prepared and filed any amendment to
the Certificate that may be required to be filed under the Act as a
consequence of any amendment to this Agreement.
(d) Any modification or amendment to this Agreement or the Certificate
made in accordance with this Section 13.3 shall be binding on all Members and
the Managers.
13.4 No Third Party Rights. Except as provided in Article 8, none of the
provisions contained in this Agreement shall be for the benefit of or
enforceable by any third parties, including creditors of the Company. Subject
to Article 8, the parties to this Agreement expressly retain any and all
rights to amend this Agreement as herein provided, notwithstanding any
interest in this Agreement or in any party to this Agreement held by any other
Person.
13.5 Severability. In the event any provision of this Agreement is held
to be illegal, invalid or unenforceable to any extent, the legality, validity
and
51
enforceability of the remainder of this Agreement shall not be affected
thereby and shall remain in full force and effect and shall be enforced to the
greatest extent permitted by law.
13.6 Nature of Interest in the Company. A Member's Membership Interest
shall be personal property for all purposes.
13.7 Binding Agreement. Subject to the restrictions on the disposition
of Membership Interests herein contained, the provisions of this Agreement
shall be binding upon, and inure to the benefit of, the parties hereto and
their respective heirs, personal representatives, successors and permitted
assigns.
13.8 Headings. The headings of the Certificate and sections of this
Agreement are for convenience only and shall not be considered in construing
or interpreting any of the terms or provisions hereof.
13.9 Word Meanings. The words such as "herein", "hereinafter", "hereof",
and "hereunder" refer to this Agreement as a whole and not merely to a
subdivision in which such words appear unless the context otherwise requires.
The singular shall include the plural, and vice versa, unless the context
otherwise requires.
13.10 Counterparts. This Agreement may be executed in several
counterparts, all of which together shall constitute one agreement binding on
all parties hereto, notwithstanding that all the parties have not signed the
same counterpart.
13.11 Entire Agreement. This Agreement contains the entire agreement
between the parties hereto and thereto and supersedes all prior writings or
agreements with respect to the subject matter hereof.
13.12 Partition. The Members agree that the Property is not and will
not be suitable for partition. Accordingly, each of the Members hereby
irrevocably waives any and all right such Member may have to maintain any
action for partition of any of the Property. No Member shall have any right
to any specific assets of the Company upon the liquidation of, or any
distribution from, the Company.
52
13.13 Governing Law; Consent to Jurisdiction and Venue. This
Agreement shall be construed according to and governed by the laws of the
State of Delaware without regard to principles of conflict of laws. The
parties hereby submit to the exclusive jurisdiction and venue of the state
courts of New York County, New York or to the Court of Chancery of the State
of Delaware and the United States District Court for the Southern District of
New York and of the United States District Court for the District of Delaware,
as the case may be, and agree that the Company or Members may, at their
option, enforce their rights hereunder in such courts.
13.14 Discretion. Whenever a Manager shall have discretion to act
hereunder, such Person agrees to act in a reasonable manner on behalf of the
Company and its Affiliates."
[INTENTIONALLY LEFT BLANK]
53
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
GROUP A MEMBERS
SEACOR OFFSHORE RIGS INC.
By:/s/▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Vice-President
GROUP B MEMBERS
COI, LLC
By:/s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
54
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
GROUP C MEMBERS
/s/▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇
ASHTON GROUP INC.
By:/s/▇▇▇▇▇▇ ▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇
Title: President
/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/▇▇▇▇ ▇▇▇▇▇▇▇▇/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
as tenants in common
/s/▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇▇▇▇▇
55
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
/s/▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
/s/▇▇▇▇▇ ▇▇▇▇▇/▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇, as
tenants in common
/s/▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇/▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------------
Name: ▇▇▇▇▇▇ ▇. and ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
as joint tenants with rights of
survivorship
/s/▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
56
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
/s/▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
/s/▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
/s/▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
/s/▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
57
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
/s/▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
/s/▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
/s/▇▇▇ ▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇▇▇▇
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
/s/▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇/▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
as joint tenants with rights
of survivorship
58
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
/s/▇▇▇▇▇▇ ▇▇▇▇▇, JR.
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇, Jr.
/s/▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇ ▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
A.R.E. INVESTMENT PARTNERSHIP
By:/s/▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Partner
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ENTERPRISES
By:/s/▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President
/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
59
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ FOR JOINT
ACCOUNT OF ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇/
▇▇▇▇ ▇▇▇▇▇▇▇ AND ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Authorized Signatory
BASSOE RIG PARTNERS, LTD.
By:/s/▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Vice President
/s/▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ III/▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ III,
as joint tenants with rights of
survivorship
/s/▇▇▇▇ ▇. LOCKER
----------------------------------
Name: ▇▇▇▇ ▇. Locker
BOSCHWITZ FAMILTY TRUST
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Trustee
60
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
/s/ROME ▇▇▇▇▇▇
----------------------------------
Name: Rome ▇▇▇▇▇▇
▇▇▇▇ TRADING, INC.
By:/s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇. GOLD
----------------------------------
Name: ▇▇▇▇▇▇ ▇. Gold
/s/▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ REVOCABLE TRUST,
DATED 11/3/89
By:/s/▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Trustee
61
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
▇▇▇▇▇▇▇▇▇▇▇-CLOSE INVESTMENT
PARTNERSHIP, LP
By:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: Managing Member
▇. ▇▇▇▇▇▇▇▇▇▇▇ INVESTMENT
PARTNERSHIP, L.P.
By:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: Managing Member
PIEROT ENTERPRISES, INC.
By:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Title: President
▇▇▇▇▇▇▇▇▇▇ FAMILY LTD. PARTNERSHIP
By:/s/▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: General Partner
62
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
/s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇/▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ R and ▇▇▇▇▇ ▇. ▇▇▇▇▇,
as joint tenants with rights
of survivorship
/s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
as tenants in common
/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/▇▇▇▇▇▇ ▇. ▇▇▇▇/▇▇▇▇ ▇. ▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. and ▇▇▇▇ ▇. ▇▇▇▇,
as tenants in common
/s/▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
/s/▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
63
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
SOUTH STREET CAPITAL, L.P.
By SOUTH STREET INVESTMENTS, INC.,
as General Partner
By:/s/▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Secretary
/s/▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ FOREIGN PARTNERS L.P.
By ▇▇▇▇▇▇▇▇ PARTNERS, LLC, as
General Partner
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President
▇▇▇▇▇▇▇▇ PARTNERS L.P.
By ▇▇▇▇▇▇▇▇ PARTNERS, LLC, as
General Partner
By:/s/▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Executive Vice President
64
[Signature page to Operating Agreement of
▇▇▇▇▇▇ Offshore LLC]
WINDCREST PARTNERS
By:/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: General Partner
WOODLAND PARTNERS
By:/s/▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: General Partner
/s/▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇.
----------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇, by ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇. as Attorney-
in-fact
65
SCHEDULE 1
A. Group A Members
Value of Capital
Total Account for Purposes Percentage
Capital of Determining Interest of
Name and Address Cash Contributed Contribution Percentage Interest Company
---------------- ---------------- ------------ --------------------- -----------
SEACOR Offshore Rigs Inc. $35,000,000 consisting of (i) $35,000,000 $36,000,000 55.38%
1370 Avenue of the Americas $8,850,000 in cash contributed on
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇, ▇▇▇▇, (▇▇) $13,991,716.41 in
▇▇▇ ▇▇▇▇, ▇.▇. ▇▇▇▇▇-▇▇▇▇ the aggregate consisting of various
bridge loans to the Company contributed
Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇ to the Company as of December 16, 1997,
and (iii) $12,158,283.86 in cash
contributed on December 16, 1997.
66
SCHEDULE 1 (cont'd)
B. Group B Members
Value of Capital
Cash and/or Total Account for Purposes Percentage
Property Gross Asset Capital of Determining Interest of
Name and Address Contributed Value Contribution Percentage Interest Company
---------------- ----------- ----------- ------------ ------------------- -----------
COI, LLC The properties, assets and $8,486,000 $8,850,000 $9,000,000 13.85%
11200 Westheimer rights assigned by COI to
Suite 410 the Company pursuant to the
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇ Assignment and Assumption
Agreement dated August 5,
1997 between COI and the
Company
$364,000 in cash
contributed on August 5, 1997 N/A
67
SCHEDULE 1 (cont'd)
C. Group C Members
Percentage
Interest of
Names and Addresses Cash Capital Contribution Company
------------------- ------------------------- -----------
▇▇▇ ▇▇▇▇▇▇ $250,000 0.3846%
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ashton Group Inc. $100,000 0.1539%
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ $100,000 0.1539%
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇. #▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ $100,000 0.1539%
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇ $ 25,000 0.0385%
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ $100,000 0.1539%
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇. ▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇ $275,000 0.4231%
c/▇ ▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇ $275,000 0.4231%
c/o ▇▇▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
68
SCHEDULE 1 (cont'd)
Percentage
Interest of
Names and Addresses Cash Capital Contribution Company
------------------- ------------------------- -----------
▇▇▇▇ ▇. ▇▇▇▇▇▇ $250,000 0.3846%
c/o Gilder, Gagnon, ▇▇▇▇ and Co.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. and ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ $ 50,000 0.0769%
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ $500,000 0.7693%
c/o SEACOR SMIT Inc.
1370 Avenue of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ $ 50,000 0.0769%
▇/▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ $150,000 0.2308%
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ $100,000 0.1539%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ $100,000 0.1539%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ $100,000 0.1539%
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
69
SCHEDULE 1 (cont'd)
Percentage
Interest of
Names and Addresses Cash Capital Contribution Company
------------------- ------------------------- ----------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ $ 50,000 0.0769%
▇/▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇ $ 50,000 0.0769%
c/o Credit Suisse First Boston
Corporation
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Mr. Rome ▇▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ $100,000 0.1539%
▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ $100,000 0.1539%
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇. ▇▇▇▇▇▇ $ 50,000 0.0769%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ $300,000 0.4616%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ $ 50,000 0.0769%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ $150,000 0.2308%
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
70
SCHEDULE 1 (cont'd)
Percentage
Interest of
Names and Addresses Cash Capital Contribution Company
------------------- ------------------------- -----------
▇▇▇▇▇▇ ▇▇▇▇▇▇ $ 50,000 0.0769%
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ $ 50,000 0.0769%
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ $ 50,000 0.0769%
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ $150,000 0.2308%
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇. #▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, Jr. $200,000 0.3077%
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ $100,000 0.1539%
c/o Stein Mart, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ $250,000 0.3846%
c/o Gilder, Gagnon, ▇▇▇▇ and Co.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
A.R.E. Investment Partnership $100,000 0.1539%
c/o Navicom
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Enterprises $100,000 0.1539%
c/o Navicom
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇▇▇▇▇▇▇
71
SCHEDULE 1 (cont'd)
Percentage
Interest of
Names and Addresses Cash Capital Contribution Company
------------------- ------------------------- -----------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ $300,000 0.4616%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ for joint account of
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇/▇▇▇▇ ▇▇▇▇▇▇▇ and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ $ 50,000 0.0769%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Bassoe Rig Partners Ltd. $1,000,000 1.5385%
c/o AS&K Services Ltd.,
Cedar House
41 Cedar Avenue
▇▇▇▇▇▇▇▇ ▇▇ 12
Bermuda
▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ III $1,000,000 1.5385%
c/o Center for Strategic & International
Studies
▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
▇▇▇▇ ▇. Locker $500,000 0.7693%
c/o Bonafide Estates Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, #▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Boschwitz Family Trust $100,000 0.1539%
c/o Navicom
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Rome ▇▇▇▇▇▇ $100,000 0.1539%
▇▇▇ ▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ Trading, Inc. $ 50,000 0.0769%
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
72
SCHEDULE 1 (cont'd)
Percentage
Interest of
Names and Addresses Cash Capital Contribution Company
------------------- ------------------------- -----------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ $250,000 0.3846%
c/o Gilder, Gagnon, ▇▇▇▇ and Co.
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. Gold $500,000 0.7693%
c/o Gold, ▇▇▇▇▇▇▇ & Marks
Forty-One Madison Ave., 33rd Floor
New York, NY 10010
▇▇▇▇▇ ▇. ▇▇▇▇▇ $100,000 0.1539%
▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ Revocable Trust, $100,000 0.1539%
Dated 11/3/89
c/o Navicom
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇-Close Investment Partnership, LP $200,000 0.3077%
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇▇▇▇ Investment Partnership, LP $800,000 1.2308%
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Pierot Enterprises, Inc. $3,000,000 4.6155%
▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇.
▇▇▇▇▇▇▇▇▇▇ Family Ltd. Partnership $100,000 0.1539%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇ ▇. ▇▇▇▇▇ $ 30,000 0.0462%
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, # ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
73
SCHEDULE 1 (cont'd)
Percentage
Interest of
Names and Addresses Cash Capital Contribution Company
------------------- ------------------------- -----------
▇▇▇▇▇▇▇ ▇. and ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ $ 20,000 0.0308%
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ $ 50,000 0.0769%
c/o Swander ▇▇▇▇ Capital
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇. and ▇▇▇▇ ▇. ▇▇▇▇ $ 50,000 0.0769%
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ $ 50,000 0.0769%
c/o SEACOR Marine (Europe) ▇.▇.
▇▇▇▇▇▇▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ $ 37,500 0.05769%
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ $ 37,500 0.05769%
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
South Street Capital, L.P. $3,000,000 4.6155%
c/o ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ & Sons, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ $100,000 0.1539%
c/o The ▇▇▇▇▇▇ Group
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
74
SCHEDULE 1 (cont'd)
Percentage
Interest of
Names and Addresses Cash Capital Contribution Company
------------------- ------------------------- -----------
▇▇▇▇▇▇▇▇ Foreign Partners L.P. $300,000 0.4616%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ Partners L.P. $2,850,000 4.3847%
c/o GeoCapital Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Windcrest Partners $500,000 0.7693%
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn.: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Woodland Partners
c/o GeoCapital Corporation $300,000 0.4616%
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ $100,000 0.1539%
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇. ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
75
SCHEDULE 1 (cont'd)
SCHEDULE 2
Total
Authorized Number Percentage of
Shares of of Shares Outstanding
Capital Name of Held by Stock Held by
Stock Shareholder Stockholder Stockholder
---------- ----------- ----------- -------------
A. SEACOR Offshore
Rigs Inc. 1,000 SEACOR SMIT Inc. 100 100%
Percentage of
Outstanding
Membership
Interests Held
Names of Members by Member
---------------- --------------
B. COI, LLC Bassoe Rig 37.5%
Partners Ltd.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ 30.0%
▇▇▇▇▇▇▇ ▇. 25.0%
Fairbanks III and
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
jointly
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 7.5%
76
SCHEDULE 7.4
Slate of Officers
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President and Chief Executive Officer
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Senior Vice President and Chief Financial Officer
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Senior Vice President of Engineering and Operations
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇, Vice President of Operations
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Vice President of Human Resources
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Vice President and Controller
▇▇▇▇▇▇▇ ▇▇▇▇▇, Vice President
▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Secretary
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Assistant Secretary
77