Exhibit 10.2
EXECUTION COPY
AMENDED AND RESTATED
LIMITED LIABILITY COMPANY
AGREEMENT
OF
ZYMAN GROUP, LLC
Dated
April 1, 2005
AMENDED AND RESTATED
LIMITED LIABILITY COMPANY
AGREEMENT
OF
ZYMAN GROUP, LLC
THIS AMENDED AND RESTATED
OPERATING AGREEMENT (this “ Agreement ”) dated
April 1, 2005, is made and entered into by and among
ZG ACQUISITION INC. , a Delaware
corporation (“ MDC ”), ZYMAN COMPANY, INC. , a Delaware
corporation (“ Zyman ”); the management
unitholders signatory hereto (together with any management
unitholders who are admitted as members following the date hereof
pursuant to Section 2.4, the “ Management Unitholders ”
(which term, for the avoidance of any doubt, shall not include
Sergio Zyman (“ SZ ”)); the Management
Unitholders together with Zyman and MDC collectively referred to as
the “ Members
” and individually a “ Member ”), MDC PARTNERS INC. , a corporation
organized under the federal laws of Canada (“ MDC Partners ”), and
ZYMAN GROUP,
LLC , a Delaware
limited liability company (the “ Company ”). Capitalized
terms used herein and not otherwise defined shall have the meanings
ascribed to such terms in Article XIII.
WHEREAS , Zyman and
the Management Unitholders are parties to a Limited Liability
Company Agreement (the “ Original Operating Agreement
”);
WHEREAS , pursuant
to the Membership Unit Purchase Agreement dated April 1, 2005
(the “ Purchase
Agreement ”), Zyman and certain Management
Unitholders sold, transferred, conveyed and delivered to MDC
30,794,384 Class B Units, which units were, effective upon
such transfer, automatically converted into Class A Units of
the Company pursuant to the terms of the Original Operating
Agreement (the “ Purchase
Transaction ”), such that immediately after giving
effect to such transfer, the issued and outstanding Units of the
Company were as set forth on Schedule 2.1 ; and
WHEREAS , in
connection with the Closing of the Purchase Transaction, the
Members now desire to admit MDC as a member, and to amend and
restate the Original Operating Agreement in the form hereof;
NOW ,
THEREFORE , in
consideration of the mutual covenants and agreements set forth in
this Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
Members and the other parties hereto do hereby agree as
follows:
ARTICLE I
FORMATION OF LIMITED LIABILITY
COMPANY
Section 1.1
Formation . The Company was formed as a
limited liability company under the laws of the State of Delaware
by the filing with the Secretary of State of Delaware of the
Certificate of Formation (as may be amended from time to time, the
“ Certificate
”).
Section 1.2
Purpose . The Company may engage in any
lawful business of every kind and character for which a limited
liability company may be organized under the Delaware Limited
Liability Company Act (as amended from time to time, the “
Act ”) or any
successor statute. The Company shall have all of the powers
provided for a limited liability company under the Act.
Section 1.3
Offices; Registered Agent . The principal
place of business of the Company shall be 950 East Paces Ferry
Road, N.E., Suite 3300, Atlanta, Georgia 30326, or such other
principal place of business as the Managers (as defined in
Section 11.5) may from time to time determine. The
Company may have, in addition to such office, such other offices
and places of business at such locations, both within and without
the State of Delaware, as the Managers may from time to time
determine or the business and affairs of the Company may
require. The registered agent of the Company in the State of
Delaware shall be the initial registered agent named in the
Certificate or such other Person (as defined in Section 13.1)
as the Managers may designate from time to time in the manner
provided by law.
Section 1.4
Filings and Foreign Qualification . Upon
the request of the Managers, the Members shall promptly execute and
deliver all such certificates and other instruments conforming
hereto as shall be necessary for the Managers to accomplish all
filing, recording, publishing and other acts appropriate to comply
with all requirements for the formation and operation of a limited
liability company under the laws of the State of Delaware and for
the qualification and operation of a limited liability company in
all other jurisdictions where the Company shall propose to conduct
business.
Section 1.5
Term . The Company commenced on the date
the Company initially filed its Certificate with the Secretary of
State of Delaware and shall continue in existence, unless sooner
terminated in accordance with the provisions of this Agreement.
ARTICLE II
MEMBERS; MEMBERSHIP INTERESTS;
UNITS
Section 2.1
Members and Membership Units . The Company
is authorized to issue 31,500,000 Class A Units and 25,000,000
Class B Units and the issued Class A Units and
Class B Units are allocated among the Members as set forth on
Schedule 2.1
. Except as the Board of Managers may otherwise determine,
all Units acquired by the Company from any Member pursuant to
Article X hereof or otherwise shall not be cancelled but shall
constitute authorized but unissued Units. Upon any change in
the Members or Units, including by reason of the
2
issuance of additional
Units, Schedule 2.1 shall be deemed to
be updated to reflect such changes and the Members agree to
complete a revised Schedule 2.1 hereof, which
shall be deemed incorporated into this Agreement as part of this
Section 2.1.
Section 2.2
Classes of Units .
(a)
Class A Units . The Class A Units shall have
the following characteristics: (i) an initial Unit Capital
Account (as defined in Section 7.2(e) hereof),
(ii) provisions relating to transfer as provided in
Article X hereof, (iii) entitlement to a share of Profits
and Losses as set forth in Section 3.3, (iv) entitlement
to distributions as provided in Sections 3.4 and 9.2,
(v) entitlement to allocations of PBT as provided in
Section 3.5 and (vi) voting rights equal to one vote per
Unit.
(b)
Class B Units . The Class B Units shall have the
following characteristics: (i) an initial Unit Capital Account
(as defined in Section 7.2(e) hereof),
(ii) provisions relating to transfer as provided in
Article X hereof, (iii) entitlement to a share of Profits
and Losses as set forth in Section 3.3, (iv) entitlement
to distributions as provided in Sections 3.4 and 9.2,
(v) entitlement to allocations of PBT as provided in
Section 3.5 and (vi) voting rights equal to one vote per
Unit.
Section 2.3
Transfer of Units . In the event a Member
transfers all or a portion of its Membership Interests in
accordance with Article X hereof, then effective as of the
date of the sale and subject to compliance with Section 10.1
hereof, such Member shall automatically cease to be a Member in the
Company as to such sold Unit. Except as otherwise expressly
provided herein, upon a transfer of Units permitted by this
Agreement, the transferee shall have all of the rights, powers and
duties of the transferor hereunder with respect to the transferred
Units and shall be admitted as a Member, the transferee shall sign
a counterpart to this Agreement and Schedule 2.1 shall be amended
as set forth in Section 2.1.
Section 2.4
Additional Members and Membership Interests
. Subject to Section 2.3, additional Persons may be
admitted to the Company as Members and Membership Interests may be
created and issued to such Persons on such terms and conditions as
the Board of Managers shall approve, subject to Section 4.1
hereof. The terms of admission or issuance may specify the
creation of different classes or groups of Members having different
rights, powers and duties. The creation of any new class or
group of Members shall be indicated in an amendment to this
Agreement in accordance with Section 14.4 hereof and such
amendment shall indicate the different rights, powers and duties of
the classes or groups of Members. Upon admission of a new
Member, such Person shall sign a counterpart to this Agreement and
Schedule 2.1
shall be amended as set forth in Section 2.1.
Section 2.5
Liability of Member . Except as expressly
provided under the Act, no Member shall be liable for the debts,
liabilities, contracts or other obligations of the Company, and no
Member shall be required to make any loans to the Company.
Subject to the limitations and conditions provided for in
Article XI hereof and the Act, the Company shall indemnify and
hold harmless a Member in the event a Member becomes liable,
notwithstanding the preceding sentence, for any debt, liability,
contract or other obligation of the Company except to the extent
expressly provided in the preceding sentence.
3
Section 2.6
Limitations on Members . Other than as
specifically provided for in this Agreement, the Purchase
Agreement, an Employment Agreement entered into pursuant to the
Purchase Agreement, or the Act, no Member shall: (a) be
permitted to take part in the business or control of the business
or affairs of the Company; (b) have any voice in the
management or operation of any Company property; or (c) have
the authority or power to act as agent for or on behalf of the
Company or any other Member, to do any act which would be binding
on the Company or any other Member, or to incur any expenditures,
debts, liabilities or obligations on behalf of or with respect to
the Company.
Section 2.7
Certification of Units . Unless a majority of the
Members of each class of Units otherwise agree, the Company shall
issue certificates to the Members representing the Units held by
such Members. The following provisions shall apply:
(a)
Certificates attesting to the ownership of Units in the Company
shall be in such form as shall be approved by the Managers and
shall state that the Company is a limited liability company formed
under the laws of the State of Delaware, the name of the Member to
whom such certificate is issued and that the certificate represents
limited liability company interests within the meaning of the
Act. Each such certificate shall be signed by such officers
of the Company as are approved by the Managers and shall bear a
legend in substantially the following form:
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ISSUED
PURSUANT TO AN EXEMPTION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”). IN ADDITION, THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN TRANSFER AND
OTHER RESTRICTIONS SET FORTH IN THE AMENDED AND RESTATED LIMITED
LIABILITY COMPANY OPERATING AGREEMENT, DATED APRIL 1, 2005,
AMONG ZYMAN GROUP, LLC AND ITS MEMBERS (THE
“AGREEMENT”) AND MAY NOT BE OFFERED OR SOLD EXCEPT
IN COMPLIANCE WITH SUCH TRANSFER RESTRICTIONS. COPIES OF THE
AGREEMENT ARE ON FILE WITH THE SECRETARY OF THE LIMITED LIABILITY
COMPANY AND ARE AVAILABLE WITHOUT CHARGE UPON WRITTEN REQUEST
THEREFOR. THE HOLDER OF THIS CERTIFICATE, BY ACCEPTANCE OF THIS
CERTIFICATE, AGREES TO BE BOUND BY ALL OF THE PROVISIONS OF THE
AFORESAID AGREEMENT AND THE APPLICABLE RESTRICTIONS UNDER THE
ACT.
(b)
The transfer register or transfer book and blank certificates shall
be kept by the secretary of the Company or by any transfer agent or
registrar approved by the Managers for that purpose. The
certificates shall be numbered and registered in the share or unit
register or
4
transfer books of the Company as they are
issued. Except to the extent that the Company shall have received
written notice of an assignment of any Unit in the Company, the
Company shall be entitled to treat the Person in whose name any
certificates issued by the Company stand on the books of the
Company as the absolute owner thereof, and shall not be bound to
recognize any equitable or other claim to, or interest in, such
Unit on the part of any other Person.
(c)
Subject to all provisions herein relating to transfers of Units, if
the Company shall issue certificates in accordance with the
provisions of this Section 2.7, transfers of Units shall be
made on the register or transfer books of the Company upon
surrender of the certificate therefor, endorsed by the Person named
in the certificate or by an attorney lawfully constituted in
writing.
(d)
The holder of any certificates issued by the Company shall
immediately notify the Company of any loss, destruction or
mutilation of such certificates, and the Managers may cause a new
certificate or certificates to be issued to such holder, in case of
mutilation of the certificate, upon the surrender of the mutilated
certificate or, in case of loss or destruction of the certificate,
upon satisfactory proof of such loss or destruction and, if the
Managers shall so determine, the granting of an indemnity as is
approved by the Managers.
ARTICLE III
CAPITAL CONTRIBUTIONS;
ALLOCATIONS AND DISTRIBUTIONS
Section 3.1
Capital Account; Capital Contributions .
The Capital Accounts of each Member shall be computed in accordance
with Section 7.2. Notwithstanding the foregoing, the
initial Capital Accounts of the Members shall be set forth as on
Schedule 3.1 and adjusted on the same basis as the initial
Capital Accounts were determined to reflect (grossed-up) any
additional payments made by MDC for its interest pursuant to the
Purchase Agreement.
Section 3.2
Withdrawal and Return of Capital Contribution
. No Member shall have the right to receive or withdraw its
Capital Contribution except to the extent, if any, that any
distribution made pursuant to the express terms of this Agreement
may be considered as such by law or as expressly provided for in
this Agreement.
Section 3.3
Allocation of Profits and Losses .
(a)
Except as otherwise provided in this Section 3.3, all Profits
and Losses of the Company (as such terms are defined in
Section 13.1 hereof) for any calendar year shall be allocated
and charged to the Members for income tax purposes (including
without limitation the capital account maintenance regulations
under Section 704(b) of the Code) as follows:
(i)
Profits shall be allocated as follows:
(A)
First, pro rata to those Members to whom PBT (as such term is
defined in Section 13.1) for such calendar year and each prior
calendar year since the Effective Time has been allocated under
Section 3.5 until the excess of the allocation to each such
Member
5
of
Profits under this Section 3.3(a)(i)(A) over any
allocation to each such Member of Losses under
Section 3.3(a)(ii)(B) for such calendar years equals the
amount of PBT so allocated to each such Member during such calendar
years; and
(B)
Thereafter, to the Members in accordance with the number of Units
owned by each.
(ii)
Losses shall be allocated as follows:
(A)
First, to the extent that Profits allocated under
Section 3.3(a)(i)(B) over Losses previously allocated
under this Section 3.3(a)(ii)(A) exceed distributions
made in accordance with the number of Units owned by each Member
under Section 3.4(a)(iv), to the Members in the proportion in
which such excess was allocated;
(B)
Second, to the extent that Profits allocated under
Section 3.3(a)(i)(A) over Losses previously allocated
under this Section 3.3(a)(ii)(B) exceed distributions
under Sections 3.4(a)(i), (ii) or (iii), as applicable, to the
Members in the proportion in which such excess was allocated;
(C)
Third, to the Members in accordance with the number of Units owned
by each.
(b)
Special Allocations and Limitations
(1)
In the event a Member unexpectedly receives in any taxable year any
adjustments, allocations, or distributions described in Treasury
Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5), or
(6) which cause or increase an Adjusted Capital Account
Deficit (as defined in Section 13.1) of such Member, items of
Company income and gain shall be specially allocated to such Member
in such taxable year (and, if necessary in subsequent taxable
years), in an amount and manner sufficient to eliminate, to the
extent required by the Treasury Regulations, the Adjusted Capital
Account Deficit of such Member as quickly as possible, provided
that an allocation pursuant to this
Section 3.3(b)(1) shall be made only if and to the extent
that the Members would have an Adjusted Capital Account Deficit
after all the allocations provided for in this Section 3 have
been tentatively made as if this Section 3.3(b)(1) were
not in the Agreement.
(2)
In the event any Member has an Adjusted Capital Account Deficit 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 deemed to be obligated to restore pursuant to the
penultimate sentences of Regulations Sections
1.704-2(g)(1) and 1.704-2(i)(5), the Member shall be specially
allocated items of the Company income and gain in the amount of
such excess as quickly as possible, provided that an allocation
pursuant to this Section 3.3(b)(2) shall be made only if
and to the extent that such Member would have an Adjusted Capital
Account Deficit in excess of such sum
6
after all other
allocations provided for in this Article III have been
tentatively made as if Section 3.3(b)(1) hereof and this
Section 3.3(b)(2) were not in the Agreement.
(3)
Notwithstanding the provisions of Section 3.3(a), in no event
shall Losses of the Company be allocated to a Member if such
allocation would result in such Member’s having an Adjusted
Capital Account Deficit at the end of any taxable year. All
Losses in excess of the limitation set forth in this
Section 3.3(b)(3) shall be allocated to the Members with
positive balances in their Capital Accounts, as a class pro rata in
proportion to such positive balances.
(4)
To the extent an adjustment to the adjusted tax basis of any
Company asset, pursuant to Section 734(b) or
Section 743(b) of the Code is required, pursuant to
Treasury Regulations Section 1.704-1(b)(2)(iv)(
m )(2) or
Section 1.704-1(b)(2)(iv)( m )(4), to be taken into account in
determining Capital Accounts as the result of a distribution to a
Member in complete liquidation of such Member’s interest in
the Company, the amount of such adjustment to Capital Accounts
shall be treated as an item of gain (if the adjustment increases
the basis of the asset) or loss (if the adjustment decreases such
basis) and such gain or loss shall be specifically allocated to the
Members in accordance with their interests in the Company in the
event Treasury Regulations Section 1.704-1(b)(2)(iv)(
m )(2) applies,
or to the Member to whom such distribution was made in the event
Treasury Regulations Section 1.704-1(b)(2)(iv)(
m
)(4) applies.
(5)
The allocations set forth in Sections 3.3(b)(1), (2), (3) and
(4) (the “ Regulatory
Allocations ”) are intended to comply with certain
requirements of Treasury Regulations promulgated under
Section 704 of the Code. The Regulatory Allocations
shall be taken into account in allocating other Profits, Losses,
and items of income, gain, loss, and deduction to each Member so
that, to the extent possible, and to the extent permitted by
Treasury Regulations, the net amount of such allocations of other
Profits, Losses, and other items and the Regulatory Allocations to
each Member shall be equal to the net amount that would have been
allocated to each Member if the Regulatory Allocations had not been
made.
(6)
The respective interests of the Members in the Profits, Losses, or
items thereof shall remain as set forth above unless changed by
amendment to this Agreement or by an assignment of a Unit
authorized by the terms of this Agreement. Except as
otherwise provided herein, for tax purposes, all items of income,
gain, loss, deduction, or credit shall be allocated to the Members
in the same manner as are Profits and Losses; provided, however,
that with respect to property contributed to the Company by a
Member, such items shall be shared among the Members so as to take
into account the variation between the basis of such property and
its fair market value at the time of contribution in accordance
with Section 704(c) of the Code.
(7)
The Capital Accounts of all Members shall be adjusted pursuant to
the rules of Treasury Regulation
Section 1.704-1(b)(2)(iv)(f) upon the circumstances set
forth in Treasury Regulation
Section 1.704-1(b)(2)(iv)(f)(5). Corresponding
adjustments shall be made as provided for under Treasury Regulation
1.704-1(b)(2), including Section 1.704-1(b)(2)(iv)(g).
7
(c)
Other Special Allocations . The following special
allocations shall be made in the following order:
(1)
Except as otherwise provided in Section 1.704-2(f) of the
Treasury Regulations, notwithstanding any other provision of this
Section 3, if there is a net decrease in Company Minimum Gain
(as defined in Section 13.1) during any fiscal year, each
Member shall be specially allocated items of Company income and
gain for such fiscal year (and, if necessary, subsequent fiscal
years) in an amount equal to such Member’s share of the net
decrease in Company Minimum Gain, determined in accordance with
Section 1.704-2(g) of the Treasury Regulations.
Allocations pursuant to the previous sentence shall be made in
proportion to the respective amounts required to be allocated to
each Member pursuant thereto. The items to be so allocated
shall be determined in accordance with Sections
1.704-2(f)(6) and 1.704-2(j)(2) of the Treasury
Regulations. This Section 3.3(c)(1) is intended to
comply with the minimum gain chargeback requirement in
Section 1.704-2(f) of the Treasury Regulations and shall
be interpreted consistently therewith.
(2)
Except as otherwise provided in Section 1.704-2(i)(4) of
the Treasury Regulations, notwithstanding any other provision of
this Section 3, if there is a net decrease in Member
Nonrecourse Debt Minimum Gain (as defined in Section 13.1)
attributable to a Member Nonrecourse Debt (as defined in
Section 13.1) during any fiscal year, each Member who has a
share of the Member Nonrecourse Debt Minimum Gain attributable to
such Member Nonrecourse Debt, determined in accordance with
Section 1.704-2(i)(5) of the Treasury Regulations, shall
be specially allocated items of Company income and gain for such
fiscal year (and, if necessary, subsequent fiscal years) in an
amount equal to such Member’s share of the net decrease in
Member Nonrecourse Debt Minimum Gain attributable to such Member
Nonrecourse Debt, determined in accordance with
Section 1.704-2(i)(4) of the Treasury Regulations.
Allocations pursuant to the previous sentence shall be made in
proportion to the respective amounts required to be allocated to
each Member pursuant thereto. The items to be so allocated
shall be determined in accordance with Sections
1.704-2(i)(4) and 1.704-2(j)(2) of the Treasury
Regulations. This Section 3.3(c)(2) is intended to
comply with the minimum gain chargeback requirement in
Section 1.704-2(i)(4) of the Treasury Regulations and
shall be interpreted consistently therewith.
(3)
Nonrecourse Deductions (as defined in Section 13.1) for any
fiscal year shall be specially allocated among the Members in
proportion to their allocable Profits.
(4)
Any Member Nonrecourse Deductions (as defined in Section 13.1)
for any fiscal year shall be specially allocated to the Member who
bears the economic risk of loss with respect to the Member
Nonrecourse Debt to which such Member Nonrecourse Deductions are
attributable in accordance with Section 1.704-2(i)(1) of
the Treasury Regulations.
(5)
Solely for purposes of determining a Member’s proportionate
share of the “excess nonrecourse liabilities” of the
Company within the meaning of Section 1.752-3(a)(3) of
the Treasury Regulations, the Members’ interests in Company
profits are in proportion to their allocable Profits, and, for
purposes of allocating Nonrecourse Liabilities (as defined in
Section 13.1) of the Company among the Members pursuant to
Treasury Regulation
8
Section 1.752-3(a)(3), the parties agree that
each Member’s interest in Company profits shall be in
proportion to their allocable Profits.
(6)
To the extent permitted by Section 1.704-2(h)(3) of the
Treasury Regulations, the Members shall endeavor to treat
distributions of funds as having been made from the proceeds of a
Nonrecourse Liability (as defined in Section 13.1) or a Member
Nonrecourse Debt (as defined in Section 13.1) only to the
extent that such distributions would otherwise cause or increase an
Adjusted Capital Account Deficit for any Member.
(7)
For purposes of determining the character (as ordinary income or
capital gain) of any Profits allocated to the Members pursuant to
this Section 3.3, such portion of Profits that is treated as
ordinary income attributable to the recapture of depreciation
shall, to the extent possible, be allocated among the Members in
the proportion which (i) the amount of depreciation previously
allocated to each Member bears to (ii) the total of such
depreciation allocated to all Members. This
Section 3.3(c)(7) shall not alter the amount of
allocations among the Members pursuant to this Section 3.3,
but merely the character of income so allocated.
(d)
The Members are aware of the income tax consequences of the
allocations described, and hereby agree to be bound by the
provisions of Section 3.3 in reporting their respective shares
of Company income and loss for income tax purposes.
(e)
It is the intention of the Company and its Members that the Company
be taxed as a partnership for all purposes of the Code and similar
income tax laws.
(f)
All matters concerning the valuation of securities, the allocation
of profits, gains and losses among the Members, including the taxes
on those profits, gains and losses, and accounting procedures, not
specifically and expressly provided for by the terms of this
Agreement, shall be determined in good faith by the Managers with
regard to their fiduciary duty to the Members, whose determination
in accordance with the terms hereof shall be final, binding and
conclusive upon all of the Members.
(g)
In connection with the exercise of a Put or a Call with respect to
Class B Units pursuant to Article X hereof, any Profits
attributable to such Class B Units arising after the date of
exercise of the applicable Put or Call shall be allocated to the
transferee of such Class B Units so long as the closing of
such transfer occurs.
Section 3.4
Distributions .
(a)
Subject to the making of the Tax Distributions (as defined in
clause (d) below) and Accrued Distributions (as defined in
clause (e) below), if any, to the extent permitted by the Act,
the Company shall make distributions as follows:
(i)
first, 100% to the holders of the Class A Units in an amount
equal to the sum of (a) the allocation to such holders of PBT
under Section 3.5(a)(i) for such calendar year plus
(b) the Class A Distribution Shortfall Amount (as defined
in Section 13.1) for such year;
9
(ii)
second, following the distribution pursuant to clause
(i) above, 100% to the holders of the Class B Units in an
amount equal to the sum of (a) the allocation to such holders
of PBT under Section 3.5(a)(ii) for such calendar year
plus (b) the Class B Distribution Shortfall Amount (as
defined in Section 13.1) for such year;
(iii)
third, following the distributions pursuant to clauses (i) and
(ii) above, 100% to the Members in accordance with any other
amounts which have been allocated pursuant to either or both of
Section 3.5(a) and Section 3.5(b) and which
have not previously been distributed, with any distributions under
this clause (iii) first being applied to the allocation of PBT
for the earliest year or period for which PBT has been allocated
but has not been fully distributed (using a first in-first out
approach); and
(iv)
fourth, following distributions pursuant to clauses (i),
(ii) and (iii) above, 100% to the members pro rata in
accordance with the number of Units owned by each.
It is the intention of
the Members that, subject to clause (b) below, the Company
shall generally make Distributions as described in 3.4(a)(i),
(ii) and (iii) above on a quarterly basis, generally in
arrears of no more than 90 days, based upon the financial
statements and the then-current forecasts prepared in good faith by
the officers of the Company and its subsidiaries and taking into
account the ongoing capital requirements of the Company.
Determinations as to the amount of such distributions shall be made
by MDC in good faith after consultation with Zyman.
Furthermore, in the event that MDC reasonably anticipates that,
based on the financial statements and then-current forecasts of the
Company and its subsidiaries, the Company will be able to make
distributions in an amount equal to the amount set forth in
Section 3.4(a)(i) above during a given calendar year, MDC
will in good faith cause the Company to make distributions to the
holders of the Class B Units towards the amount set forth in
Section 3.4(a)(ii) prior to the end of such calendar
year, at such times and in such amounts as MDC may in good faith
determine.
(b)
Any distribution of funds prior to the end of the fiscal year in
which such funds came into possession of the Company (including any
Tax Distribution, but excluding any Accrued Distribution) shall be
treated as a non-interest-bearing loan (a “ draw ”) from the Company to
each Member receiving such draw and shall be deemed repaid by
reducing the amount of each subsequent distribution to the Member
receiving such draw pursuant to this Section 3.4(b) by
the lesser of (i) the entire amount otherwise distributable to
the Member receiving such draw, and (ii) the entire amount of
any unrepaid draws pursuant to this Section 3.4(b). For
purposes of this clause, a Selling Member (as defined below) and
any transferee of such Selling Member shall be treated as a single
Member with respect to the Units transferred by such Selling Member
to such transferee.
10
(c)
All amounts withheld pursuant to the Code and Tax Regulations or
any provision of any state or local tax law with respect to any
payment, distribution, or allocation to the Company or the Members
shall be treated as amounts distributed to the Members pursuant to
this Section 3.4 for all purposes under this Agreement.
The Managers are authorized to withhold from distributions, or with
respect to allocations, to the Members and to pay over to any
Federal, state, or local government any amounts required to be so
withheld pursuant to the Code and Tax Regulations or any provisions
of any other Federal, state, or local law, and shall allocate any
such amounts to the Members with respect to which such amount was
withheld. Notwithstanding any other provision in this
Agreement, prior to the making any such distribution, the Managers
in their sole discretion may require the delivery to the Managers
from each or any potential distributee such evidence as the
Managers may reasonably request evidencing the absence of any
third-party claims with respect to such potential
distribution.
(d)
Notwithstanding anything in this Agreement to the contrary, in
preference to any other distributions pursuant to this
Section 3.4, the Members shall cause the Company to distribute
cash of the Company to its Members on a quarterly (or other
reasonable) basis equal to the product of (i) each
Member’s distributive share of the Company’s taxable
income (determined without regard to the election made under
Section 754 of the Code) for the current year and
(ii) the maximum individual tax rates for federal taxpayers
and Georgia taxpayers (the “ Tax Distributions ”);
provided, that, no Member will receive a Tax Distribution unless
such Member’s allocation of the Company’s taxable
income exceeds all prior cumulative allocations of the
Company’s taxable losses and provided further that if a
Member receives a Tax Distribution for a particular year that is
greater than any distribution to which that Member is entitled
under Section 3.4(a), that Member will contribute to the
Company an amount equal to the portion of the aggregate amount of
any Tax Distribution(s) received by such Member which exceed the
amount of tax which is calculated as provided above and is
attributable to such Member’s allocable share of the
Company’s taxable income for such year. For purposes of
Section 3.4(a) hereof, a Tax Distribution shall be deemed
to be a distribution at the time of such Tax Distribution and shall
reduce the amount of each subsequent distribution to any Member
receiving such Tax Distribution by the amount of any such Tax
Distribution.
(e)
Exhibit 3.4(e) hereto sets forth the portion of “5%
Equity” (as set forth on the Closing Balance Sheet (as
defined in the Purchase Agreement)) allocated to each of the
Persons set forth on such exhibit (such exhibit, the “
Pre-Closing Member
Schedule ”). No later than 5 days after the
finalization of the Closing Balance Sheet pursuant to
Section 5.11 of the Purchase Agreement, the Company shall
update the Pre-Closing Member Schedule to set forth the final
amount of 5% Equity and Dividends Payable (as each such term is
defined in the Purchase Agreement) on the Company’s Closing
Balance Sheet and the portion of each such amount allocated to each
of the Persons listed on such schedule. Notwithstanding
anything to the contrary in this Agreement, prior to any
distribution pursuant to Section 3.4(a) but in accordance
with the last paragraph of Section 3.4(a), the Company shall
distribute cash to the Persons set forth on the Pre-Closing Member
Schedule in the amounts set forth opposite each such
Person’s name (collectively, the “ Accrued Distributions
”). Such amounts shall be distributed first, in
satisfaction of the 5% Equity amounts and second in satisfaction of
the Dividends Payable amounts allocated to each such Person.
11
(f)
Notwithstanding anything in this Agreement to the contrary, any PBT
which has been allocated to the transferred Units of a Selling
Member pursuant to Section 3.5(c) shall, subject to
Section 3.4(b), be distributed to such Selling Member in
accordance with Section 3.4(a) as if such Selling Member
owned Units.
Section 3.5
Allocation of PBT .
(a)
PBT for purposes of this Agreement shall be allocated for each
Distribution Period Calendar Year as follows:
(i)
first, 100% to the holders of the Class A Units until the
holders of Class A Units have been allocated the Preferred
Return Amount and any Class A PBT Shortfall Amount with
respect to such Distribution Period Calendar Year;
(ii)
second, 100% of any remaining PBT after giving effect to the
allocations outlined in clause (i) above to the holders of
Class B Units until the holders of Class B Units have
been allocated an amount equal to the Class B Catch-Up
Amount;
(iii)
third, (x) in the event that the PBT Margin for such Distribution
Period Calendar Year is at least 30%, 100% of any remaining PBT
after giving effect to the allocations outlined in clauses
(i) and (ii) above to the Members pro rata in accordance
with the number of Units owned by each Member until the Members
have been allocated an amount equal to the product of 30% and the
Revenues for such Distribution Period Calendar Year and any
remainder in accordance with clause (iv) below and (y) in the
event that the PBT Margin for such Distribution Period Calendar
Year is less than 30%, 100% of any remaining PBT after giving
effect to the allocations outlined in clauses (i) and
(ii) above to the Members pro rata in accordance with the
number of Units owned by each Member; and
(iv)
fourth, (x) for the first two Distribution Period Calendar Years
and the portion of the third Distribution Period Calendar Year
ending on the second anniversary of the Effective Time (such date,
the “ Second
Anniversary ”) 100% of any remaining PBT after
giving effect to the allocations outlined in clauses (i),
(ii) and (iii) above to the Members, allocated 25% to the
holders of the Class A Units and 75% to the holders of the
Class B Units and (y) for the remaining Distribution Period
Calendar Years (including the portion of the third Distribution
Period Calendar Year following the Second Anniversary), 100% of any
remaining PBT after giving effect to the allocations outlined in
clauses (i), (ii) and (iii) above to the Members,
allocated 30% to the holders of the Class A Units and 70% to
the holders of the Class B Units, in each case pro rata
12
in accordance with
the number of Units of such class owned by each Member.
(b)
PBT for purposes of this Agreement shall be allocated for any Post
Distribution Period Calendar Year to the Members pro rata in
accordance with the number of Units owned by each Member.
(c)
Notwithstanding anything in this Agreement to the contrary, in the
event that a Member transfers any Units (such Member, a “
Selling Member
”), then, with respect to the calendar year in which such
transfer occurred, the Company shall allocate PBT to such Selling
Member’s transferred Units in accordance with Sections
3.5(a) and 3.5(b) above pro rata based on the number of
days elapsed in such calendar year from the first day of such
calendar year through the date of such transfer relative to a
365-day year and pro rata to the transferee based on the remainder
of the number of days in such calendar year subsequent to the date
of transfer.
ARTICLE IV
MANAGEMENT
Section 4.1
Management of the Company .
(a)
Except to the extent otherwise provided for herein, the powers of
the Company shall be exercised by and under the authority of, and
the business and affairs of the Company shall be managed under, the
direction of the Managers of the Company. Notwithstanding the
foregoing or any other provisions hereof to the contrary, for as
long as Zyman and the Management Unitholders own Class B Units
representing at least 20% of the outstanding Units, the taking of
any of the actions listed in clauses (i) through (xi) below
shall require the consent of holders of a majority of the
Class B Units.
(i)
a sale, lease or other disposition of all or substantially all of
the assets or business of the Company, except in connection with
(x) a sale, lease or other disposition of all or substantially all
of the assets or business or stock of MDC or MDC Partners,
including pursuant to merger, consolidation, amalgamation or
similar transaction, (an “ MDC Sale ”) or (y) an MDC
Financing (as defined in Section 4.1(f) hereof) or the
exercise of a default remedy under any agreement entered into in
connection with an MDC Financing;
(ii)
a merger, consolidation or amalgamation of the Company or any of
its subsidiaries with and into another Person or of another Person
with and into the Company or any of its subsidiaries;
(iii)
the authorization or issuance of additional Class A Units,
Class B Units or other equity ownership interests in, or the
granting of any other rights to participate in the proceeds of the
sale of assets of the Company which are dilutive to the
Class B Unitholders; or the incurring of debt for borrowed
money in excess of the amount provided for in the approved annual
operating budget or capital expenditure budget, except in
connection with borrowings under the terms and conditions of the
MDC
13
Cash Management Program
(and in compliance with Section 4.1(d) below); provided,
that the agreement of MDC and holders of a majority of the
Class B Units shall not be required in connection with
issuances of Units to employees of the Company and its subsidiaries
from time to time so long as such issuances represent in the
aggregate no more than 10% of the fully-diluted Units outstanding;
and provided, further, that no approval shall be required in
connection with issuances of Units contemplated by this Agreement
and the Purchase Agreement;
(iv)
a material acquisition by the Company or any of its subsidiaries of
the stock, assets or business of another Person or any investment
by the Company of funds or other assets in another Person (other
than money market investments or their equivalent);
(v)
except as permitted under Section 14.4 hereof, an amendment or
modification to the Certificate or this Agreement;
(vi)
the payment by the Company or any of its subsidiaries of any
management fee to any Member or one of such Member’s
Affiliates;
(vii)
a relocation of the Company’s primary offices outside of the
Atlanta metropolitan area;
(viii)
entering into any business other than, or any transaction outside
of, the normal business activities of the Company and any of its
subsidiaries and related activities other than in connection with a
transfer by MDC or any of its Affiliates of their respective
interests in the Company to another wholly-owned subsidiary of MDC
Partners;
(ix)
the making of any loan to any employee of the Company or any of its
subsidiaries other than reasonable travel and business expense
advances in the ordinary course and consistent with past practices
exceeding $10,000, in the aggregate, at any one time outstanding,
other than any loans contemplated by Article X hereof;
(x)
any change in the name of the Company; and
(xi)
the delegation to any Manager or to any committee of the Board of
Managers of the Company or any subsidiary or to any officer of the
Company or any subsidiary the power to take any of the actions
referred to in the foregoing clauses before obtaining the
authorization required by this Section;
provided that, notwithstanding anything in the
foregoing to the contrary, nothing in this clause (a) shall
require the consent of the holders of the Class B Units in
connection with or related to a purchase of Units by the Company or
MDC pursuant to Article X hereof (including, without
limitation, any incurrence of indebtedness in connection therewith)
or any subsequent sale or issuance of an equal number of Units,
options to purchase an equal number of Units or other equity-based
awards with respect to an equal number of Units by MDC or the
Company to any employee, director or consultant of the
Company.
14
(b)
As long as this Agreement is in full force and effect, the Company
shall keep on file at its principal office a copy of this
Agreement. The Company shall make such copy available to any Member
during normal business hours and upon reasonable advance written
notice.
(c)
As long as this Agreement is in full force and effect, the Company
and the Members agree that they shall cause any and all
subsidiaries of the Company to comply with the provisions of this
Section 4.1 to the extent such provisions are applicable to
such subsidiary.
(d)
The parties hereto further agree that the operations of the Company
and its subsidiaries shall be conducted (i) to participate in
the overall cash management and banking program of MDC Partners as
set forth on Schedule 4.1 (d) hereto (the “
MDC Cash Management
Program ”), and (ii) to comply on a timely
basis with the financial reporting and budgeting procedures, as
well as internal controls over financial reporting, of MDC Partners
as from time to time in effect, which procedures require the
approval of an annual operating budget, capital expenditure budget
and cash flow projections and require management of operating
companies to seek approval prior to material deviations from such
budgets. If any Affiliate of MDC Partners (other than the
Company or any of its subsidiaries) fails to meet its obligations
under the MDC Cash Management Program, then MDC Partners shall
satisfy such obligations to the extent that such Affiliate failed
to do so.
(e)
The parties hereto further agree that the Company shall hereby
adopt, and shall take appropriate steps to cause the employees of
the Company to comply with, the Code of Conduct of MDC Partners, as
the same may be amended from time to time.
(f)
Notwithstanding anything to the contrary contained in this
Agreement, in consideration for the payment of the Purchase Price
under Section 2.1 of the Purchase Agreement and for other good
and valuable consideration, the parties hereto hereby
(i) agree that MDC Partners and/or any of its Affiliates, in
connection with its or any of its Affiliates’ current or
future credit facilities, debt offerings (including, without
limitation, senior, subordinated or mezzanine debt issued in a
public offering or a Regulation S or Rule 144A private
placement) or any other debt agreements, shall be entitled to: (w)
pledge or grant a security interest in or otherwise have a lien
placed upon MDC’s Membership Interests; (x) pledge or grant a
security interest in or otherwise have a lien placed upon the
assets and properties of the Company and/or its subsidiaries; (y)
assign all of its rights, benefit, title and interest in the
Company and distributions therefrom, including, without limitation,
all rights and claims pursuant to and under any Put or Call to, or
to an agent or representative on behalf of, its bank or lender or
group of banks or group of lenders or holders of its other senior
debt (as applicable and collectively, the “ Lender ”); and (z) have the
Company and/or its subsidiaries provide guarantees and such other
ancillary security and related documentation as reasonably required
by the Lender from time to time (the items in (w), (x), (y) and (z)
being collectively referred to as an “ MDC Financing ”); and
(ii) consent unconditionally to (x) the granting of all
security and the execution of all documents required in connection
with an MDC Financing and the enforcement thereof, where
applicable, by the Lender; and (y) any transaction by which the
Lender becomes the absolute legal and beneficial owner of any
Membership Interests which have been pledged or assigned by
it.
15
(g)
MDC Partners shall cause sufficient working capital to be made
available to the Company as shall be determined by the Board of
Managers to be reasonably necessary to execute upon its approved
annual operating and capital expenditure budgets, but in no event
shall MDC Partners or any of its Affiliates be required to fund
losses of the Company or any of its subsidiaries. Such
working capital shall be provided to the Company on terms
consistent with the MDC Cash Management Program and accordingly,
neither MDC nor any of its Affiliates shall be required to provide
working capital in the event that the consolidated cash balance of
the Company in the MDC Cash Management Program is negative.
(h)
The Company shall comply with all applicable federal, state and
local laws and the Company shall provide reasonable assistance to
MDC and its Affiliates in their compliance with all applicable
federal, state and local laws, including without limitation, the
provisions of the Sarbanes-Oxley Act of 2002, as amended from time
to time. The Company shall use its reasonable best efforts to
undertake the actions recommended in the 404 Report (as defined in
the Purchase Agreement).
Section 4.2
Authority of Managers . Except as set forth
below, unless specifically authorized by a resolution duly adopted
by the Managers, no Manager, solely in his capacity as a Manager,
shall have the authority or power to act as agent for or on behalf
of the Company or any other Manager, to do any act which would be
binding on the Company or any other Manager, to incur any
expenditures on behalf of or for the Company, or to execute,
deliver and perform any agreements, acts, transactions or other
matters on behalf of the Company.
Section 4.3
Number and Qualifications of Managers . As
long as Sergio Zyman is the Chief Executive Officer of the Company,
there shall be seven Managers of the Company of which MDC shall be
entitled to appoint four Managers and Zyman shall be entitled to
appoint three Managers, one of whom shall be Sergio Zyman (each
Manager appointed by Zyman must be a full-time employee of the
Company or one of its subsidiaries) and, in the event that Sergio
Zyman is no longer the Chief Executive Officer of the Company, and
for so long as the Management Unitholders own at least 5% of the
outstanding Units, the Management Unitholders shall be entitled to
appoint one Manager (who must be a full-time employee of the
Company) and MDC shall be entitled to appoint two additional
Managers or, at MDC’s election, the number of Managers shall
be reduced to five. Thereafter, the Managers shall be elected
in accordance with Section 4.4. No decrease in the
number of Managers shall have the effect of shortening the term of
any incumbent Manager. None of the Managers need be Members
of the Company or residents of the State of Delaware. The
initial designees of MDC are Miles Nadal, Graham Rosenberg, Steven
Berns and Mitchell Gendel. The initial designees of Zyman are
Sergio Zyman, Lee White and Craig Binkley.
Section 4.4
Election and Term of Service . At each
annual meeting of Members held in accordance with this Agreement,
the Members may elect Managers to serve until the next succeeding
annual meeting. Subject to Section 4.3, the individuals
receiving the greatest number of votes (determined by number of
Units cast in favor) shall be the Managers. Cumulative voting
for the election of Managers shall not be permitted. Each
Manager elected shall serve as Manager for the term for which he is
elected and until his successor shall have been elected by the
Members and qualified or until his earlier death, resignation,
retirement, disqualification or removal in accordance with this
Agreement.
16
Section 4.5
Removal; Filling of Vacancies . As long as
Sergio Zyman is the Chief Executive Officer or the Management
Unitholders own at least 5% of the outstanding Units, only MDC can
remove and replace its appointed Managers and only Zyman or the
Management Unitholders, as the case may be, can remove and replace
its or their respective appointed Managers. Following such
time as SZ ceases to be Chief Executive Officer of the Company and
the Management Unitholders cease to own at least 5% of the
outstanding Units, the Members by the required vote as set forth in
Section 5.5 shall be entitled to remove any Manager and to
elect for the unexpired term of such Manager so removed another
individual. Upon the resignation, retirement or death of any
of the Managers of the Company, subject to Section 4.3, the
Members by the required vote as set forth in Section 5.5,
shall be entitled to elect another Person for the unexpired term of
such Manager.
Section 4.6
Place of Meetings . Meetings of the
Managers, annual, regular or special, may be held either in
Atlanta, Georgia or Toronto, Ontario, unless otherwise agreed to by
the Managers (including, for as long as Sergio Zyman is the Chief
Executive Officer of the Company, at least one Manager appointed by
MDC and one Manager appointed by Zyman).
Section 4.7
Annual Meetings . Annual meetings of the
Managers, of which no notice shall be required, shall be held at
the discretion of the Managers immediately following the annual
meeting of Members for the purpose of designating officers of the
Company and the transaction of any other business.
Section 4.8
Regular Meetings . The Managers shall
notify each of the Members of regular meetings of the Managers,
which meetings shall be held no less frequently than quarterly on
the last business day of each fiscal quarter or at such times and
places as may be fixed from time to time by resolution adopted by
the Managers. Except as otherwise provided by statute, any
and all business may be transacted at any regular meeting.
The Managers shall be given reasonable notice of the date, time and
place of any scheduled regular meeting.
Section 4.9
Special Meetings . Special meetings of the
Managers may be called by any Manager on not less than forty-eight
hours’ notice to each Manager, either personally or by mail
(overnight service), email, telephone, facsimile or similar
communication. Only business within the purpose or purposes
described in the notice of special meeting of Managers may be
conducted at the meeting.
Section 4.10
Quorum of and Action by Managers . At all
meetings of the Managers the presence of a majority of the number
of Managers fixed by or in the manner provided by this Agreement
shall be necessary and sufficient to constitute a quorum for the
transaction of business. Unless otherwise specifically
required by law or this Agreement, the act of a majority of
Managers present at a meeting at which a quorum is present shall be
the act of the Managers; provided that such majority includes the
affirmative vote of one MDC Manager. If a quorum shall not be
present at any meeting of the Managers, the Managers present may
adjourn the meeting to another time by giving reasonable notice of
the date, time and place of the adjourned meeting to all Managers.
At any such adjourned meeting at which a quorum is present, any
business may be transacted that might have been transacted at the
meeting as originally convened.
17
Section 4.11
Approval or Ratification of Acts or Contracts by
Members . The Managers, in their discretion,
may submit any act or contract for approval or certification at any
annual meeting of the Members, or at any special meeting of the
Members called for the purpose of considering any such act or
contract, and subject to the provisions of Section 4.1(a), any
act or contract that shall be approved or ratified by the holders
of a majority of the Units entitled to vote thereon or such greater
percentage as may be provided by any other applicable provision of
this Agreement shall be as valid and binding upon the Company and
upon all the Members as if it shall have been approved or ratified
by every Member of the Company.
Section 4.12
Action Without a Meeting . Subject to
Section 4.1(a), any action required or permitted to be taken
at any meeting of the Managers may be taken without a meeting, with
prior notice of such contemplated action to each of the Managers
(with no requirement to provide copies to any additional persons
described in Section 14.1 or otherwise), and without a vote,
if a consent or consents in writing, setting forth the action so
taken, shall be signed by the minimum number of Managers that would
have been required to approve such action at a meeting and the
writing or writings are filed with the minutes of proceedings of
the Managers. A telegram, telex, cablegram, an email or
similar transmission by a Manager, or a photographic, photostatic,
facsimile or similar reproduction of a writing signed by a Manager,
shall be regarded as signed by the Manager for purposes of this
Section 4.12.
Section 4.13
Telephone Meetings . Any Manager may
participate in any meeting of Managers by using conference
telephone or similar communications equipment by means of which all
individuals participating in the meeting can hear each other, and
participation in a meeting pursuant to this Section shall
constitute presence in person at such meeting.
Section 4.14
Interested Managers and Officers . No
contract or transaction between the Company and one or more of its
Managers or between the Company and any other Person in which one
or more of its Members, Managers or officers are shareholders,
partners, members, directors, managers or officers, or have a
financial or equity interest, shall be void or voidable solely for
this reason, or solely because the Manager is present at or
participates in the meeting of the Managers which authorizes the
contract or transaction, or solely because his or their votes are
counted for such purpose, if: (i) all material facts as to the
relationship or interest and as to the contract or transaction are
disclosed or are known to the Managers, and the Managers in good
faith authorize the contract or transaction by the affirmative vote
of a majority of the disinterested Managers, even though the
disinterested Managers be less than a quorum; (ii) the
material facts as to the relationship or interest and as to the
contract or transaction are disclosed or are known to the Members
entitled to vote thereon, and the contract or transaction is
specifically approved in good faith by vote of a majority of the
disinterested holders of Units entitled to vote thereon or such
greater percentage as may be provided by any other applicable
provision of this Agreement; or (iii) the contract or
transaction is fair as to the Company as of the time it is
authorized, approved or ratified by the Managers or the
Members.
Section 4.15
Manager’s Compensation . No Manager
shall be entitled to receive any compensation for attendance at
meetings of the Managers or otherwise serving as a Manager. Nothing
in this Agreement shall be construed to preclude any Manager from
serving the Company in any other capacity and receiving proper
compensation therefor.
18
Section 4.16
Time Devoted to Company . The Managers
shall devote such time to Company business as they deem necessary
to manage and supervise the business and affairs of the Company in
an efficient manner; but nothing in this Agreement shall preclude
the employment of any agent, third party or Affiliate to manage or
provide other services with respect to the Company’s assets
or business as the Managers shall determine.
Section 4.17
Liability of Managers . Except as expressly
provided under the Act, no Manager shall be liable for the debts,
liabilities, contracts or other obligations of the Company;
provided, however, that each Manager shall be liable for any debts,
liabilities, contracts or other obligations of the Company incurred
or agreed to by such Manager without authorization and in violation
of Section 4.2 of this Agreement.
Section 4.18
2005 Budget . During calendar year 2005,
the Company shall operate in accordance with the budget attached
hereto as Exhibit 4.18.
ARTICLE V
MEETINGS OF
MEMBERS
Section 5.1
Annual Meetings . An annual meeting of the
Members shall be held on such date, at such time and at such place
as shall be determined by the Managers and stated in the notice of
the meeting. At such meeting, the Members shall elect the
Managers (subject to Section 4.3 above) and transact such
other business as may properly be brought before the meeting.
Section 5.2
Special Meetings . Special meetings of the
Members, for any purpose or purposes, unless otherwise prescribed
by statute, the Certificate or this Agreement, may be called by
holders of at least a majority of any class of Units. Only
business within the purpose or purposes described in the notice of
special meeting of Members may be conducted at the meeting.
Section 5.3
Place of Meetings . Meetings of Members
shall be held at such places, within or without the State of
Delaware, as may from time to time be fixed by the Managers or as
shall be specified or fixed in the respective notices or waivers of
notice thereof; provided, however, the Members agree that such
meetings of Members shall be held in Atlanta or Toronto, unless
otherwise agreed upon by the Members.
Section 5.4
Notice of Meetings . Written or printed
notice (which may be given by email) stating the place, day and
hour of each meeting of the Members and, in case of a special
meeting, the purpose or purposes for which the meeting is called,
shall be delivered not less than five nor more than fifty days
before the date of the meeting, either personally, by mail or by
email, by or at the direction of any Manager or individual calling
the meeting, to each Member entitled to vote at the meeting;
provided, however, that notice of any meeting shall not be required
if all Members not receiving notice waive any and all requirements
for giving notice of such meeting of the Members.
19
Section 5.5
Quorum of and Action by Members . With
respect to any matter, the holders of at least a majority of the
Units entitled to vote on that matter, present in person or
represented by proxy shall constitute a quorum of each meeting of
Members for the transaction of business with respect to that
matter. Unless otherwise provided in this Agreement, the
Members represented in person or by proxy at a meeting of Members
at which a quorum is not present may adjourn the meeting until such
time and place as may be determined by a vote of the holders of a
majority of the Units represented in person or by proxy at that
meeting. At any such adjourned meeting at which a quorum
shall be present or represented, any business may be transacted
that might have been transacted at the meeting as originally
convened. Except as otherwise specifically provided in this
Agreement (including without limitation, the provisions of
Section 4.1(a) hereof) or under applicable law, with
respect to any matter the affirmative vote or consent of the
holders of a majority of the Units (voting together as one class)
entitled to vote on that matter and represented in person or by
proxy at a meeting of Members at which a quorum is present shall be
the act of the Members. Unless otherwise provided in this
Agreement, once a quorum is present at a meeting of Members, the
Members represented in person or by proxy may conduct such business
as may be properly brought before the meeting until it is
adjourned, and the subsequent withdrawal from the meeting of any
Member or the refusal of any Member represented in person or by
proxy to vote shall not affect the presence of a quorum at the
meeting.
Section 5.6
Action Without a Meeting . Any action
required by the Act to be taken at any annual or special meeting of
Members, or any action which may be taken at any annual or special
meeting of Members, may be taken without a meeting, with prior
notice of such contemplated action to each of the Members thereof
(with no requirement to provide copies to any additional persons
described in Section 14.1 or otherwise), and subject to
Section 4.1(a), without a vote, if a consent or consents in
writing, setting forth the action so taken, shall be signed by the
Members holding a majority of all of the Units (or if a higher
percentage of Units is required to take action, such higher
percentage). A telegram, telex, cablegram, an email or
similar transmission by a Member, or a photographic, photostatic,
facsimile or similar reproduction of a writing signed by a Member,
shall be regarded as signed by the Member for purposes of this
Section 5.6.
Section 5.7
Telephone Meetings .&
|
