Notwithstanding the foregoing, in the event that the Members, the Investors and the Company have not collectively elected to purchase all of the Transfer Units, the Transferring Holder may, within 90 days after the expiration of the Election Period, Transfer such Transfer Units to the Transferee identified in the Offer Notice at a price no less than the price specified in the Offer Notice and on other terms no more favorable to the Transferee than offered to the Company, the Investors or the other Unitholders in the Offer Notice, the Reoffer Notice or the Final Notice, as applicable. The purchase price for such Units shall be payable solely in cash at the closing of the transaction.
(a) If the Managers (with Required Approval) approve a Sale of the Company (the “Approved Company Sale”), the Unitholders will consent to and raise no objections against the Approved Company Sale. If the Approved Company Sale is structured as a (i) merger or consolidation, each Unitholder shall waive any dissenters rights, appraisal rights or similar rights in connection with such merger or consolidation or (ii) sale of Units, each holder of Units shall agree to sell all or, if the structure of the transaction requires otherwise (i.e., a leveraged recapitalization), substantially all of his Units and rights to acquire Units on the terms and conditions approved by the Managers (with Required Approval). Each Unitholder shall take all necessary or desirable actions (other than, except as provided in clause (e) below, incurring any liability) in connection with the consummation of the Approved Company Sale as requested by the Company. At least thirty (30) days prior to the proposed closing date of any Approved Company Sale, the Managers shall use commercially reasonable best efforts to give to each Unitholder written notice of the material terms of the proposed Approved Company Sale (which material terms may be set forth in a draft of the purchase and sale agreement with respect to such Approved Company Sale) and statement that the Managers, the members of the Hancock Group and the members of the Argosy Group are intending to participate in the Approved Company Sale and intend to exercise their rights under this Section 9.3. An executed version of a purchase and sale agreement shall be delivered to each Unitholder within a commercially reasonable time period after execution of such agreement and an Approved Company Sale shall be consummated within 150 days after the execution of a purchase and sale agreement therefor. Upon request, the Managers shall provide any Unitholder with a calculation of the anticipated consideration to be paid to such Unitholder in such Approved Company Sale. Notwithstanding the foregoing, in connection with and as part of any Approved Company Sale, the Company shall use commercially reasonable efforts to Transfer all of the outstanding shares of capital stock of CNIC in lieu of the Units of Company owned by CNIC for the same aggregate consideration that CNIC would have received had it transferred all of its Units in the Company.
(b) The obligations of the holders of Units with respect to the Approved Company Sale are subject to the satisfaction of the following conditions: (i) upon the consummation of the Approved Company Sale, each holder of each type of Units participating in the Approved Company Sale shall receive the same form of consideration and the same portion of consideration such holder would have received if the aggregate consideration had been distributed by the Company in complete liquidation pursuant to the rights and preferences set forth in this Agreement (but without the Company paying any amounts in such liquidation with respect to any obligations that are being assumed by the buyer in connection with such Approved Company Sale); and (ii) if any holders of a type of Units are given an option as to the form and
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amount of consideration to be received, each holder of such type of Units shall be given the same option; provided that if the capital stock of CNIC is Transferred in accordance with the last sentence of Section 9.3(a), the obligation of each other Unitholder shall be as if CNIC Transferred the Units of the Company and distributed the proceeds to its shareholders (with it being understood that the shareholders of CNIC shall bear the pro rata share of any obligations that CNIC would have been required to assume if it had sold Units of the Company.
(c) If the Company or any of the holders of the Units enter into any negotiation or transaction for which Rule 506 (or any similar rule then in effect) promulgated by the Securities Exchange Commission may be available with respect to such negotiation or transaction (including a merger, consolidation or other reorganization), each holder of Units will, at the request of the Company, appoint either a purchaser representative (as such term is defined in Rule 501) designated by the Company, in which event the Company will pay the fees of such purchaser representative, or another purchaser representative (reasonably acceptable to the Company), in which event such holder will be responsible for the fees of the purchaser representative so appointed.
(d) All holders of Units will bear their pro rata share (based upon their share of the proceeds received) of the costs of any sale of Units pursuant to an Approved Company Sale to the extent such costs are incurred for the benefit of all such holders of Units and are not otherwise paid by the Company or the acquiring party. Costs incurred by the holders of Units on their own behalf will not be considered costs of the Approved Company Sale.
(e) In connection with an Approved Company Sale, the holders of the Units may be required to make representations or warranties regarding such holder to enter into and consummate such sale and providing the purchaser with good and marketable title to the Units being sold by such holder, free and clear of all liens created by such holder. In addition, any such holder may be required to provide indemnification with respect to the breach of any representations, warranties or covenants regarding the Company contained in the agreements relating to such sale. Any such indemnification liability of a holder described in the preceding sentence shall be several only, and not joint, and shall not in any event exceed such holder’s pro rata share (based on the proceeds to be received by all of the Unitholders participating in such sale) of any such liability or exceed the proceeds received by such holder in such Approved Company Sale.
9.4 Tag-Along Rights. If any Investor (the “Transferring Investor”) desires to Transfer all or any portion of any of its Units to any Person(s) (other than pursuant to another Exempt Transfer), it must first deliver to all of the other Unitholders (the “Other Securitvholders”) a written notice (the “Sale Notice”) in which the prospective Transferring Investor states the price and other material terms and conditions on which they propose to effect such Transfer of such Units, or portion thereof, and the identity of the proposed Transferee(s). Such notice shall be delivered not less than 30 days prior to the closing of the proposed Transfer. Each Other Unitholder to whom such a Sale Notice is required to be given may within 15 days following receipt of the Sale Notice, give to the Company and the Transferring Investor a written notice (“Tag-Along Notice”) indicating that it desires to participate in such Transfer. If any Other Unitholders have elected to participate in such Transfer, each of the Transferring Investor and such Other Unitholders will be entitled to sell in the contemplated Transfer, at the same price
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and on the same terms and conditions, a number of Units of each type of Units contemplated as being Transferred equal to the product of (A) the quotient determined by dividing the number of Units of such type owned by such person by the aggregate number of Units of such type owned by the Transferring Investor and the Other Unitholders participating in such Transfer and (B) the number of units of such type of Units to be sold in the contemplated Transfer. Notwithstanding the foregoing, (x) in the event that the Transferring Investor intends to Transfer more than one type of Units, the Other Unitholders participating in such Transfer shall be required to sell in the contemplated Transfer a pro rata portion of each type of Units contemplated as being Transferred (to the extent such Other Unitholders own any Units of such other type), which portion shall be determined in the manner set forth immediately above, (y) the purchase price being paid on account of Preferred Units shall be allocated among the Transferring Investors transferring Preferred Units on the basis of the amount of Unreturned Preferred Capital and Unpaid Preferred Yield with respect to such Preferred Units and (z) the consideration to be received by any holder of rights to acquire Common Units or Preferred Units participating in such sale that has not exercised the right to acquire Common Units or Preferred Units shall be after giving effect to the exercise price therefor. No Transfer pursuant to this Section 9.4 shall be considered an Exempt Transfer unless the Transferring Investor has complied with the terms of this Section 9.4. All expenses and costs of any Transfer pursuant to this Section 9.4 shall be for the account of and paid by the Other Unitholders participating in such Transfer.
(a) In the event the employment of a Member who is also an employee of the Company (or any Subsidiary thereof) is terminated for any reason, if the promissory notes evidencing such loans are still outstanding, the disposition of all Units acquired by such employee with the proceeds of loans from the Company (or any Subsidiary thereof) shall, to the extent such provisions conflict with the provisions of this Section 90S, be determined by the provisions of the documents pursuant to which such loans were made (including promissory notes of such employee payable to the Company (or any Subsidiary thereof) and resolutions of Managers of the Company authorizing such loans).
(b) Except as provided in Section 9.5(a) above, in the event a Member who is also an employee of the Company (or any Subsidiary thereof) voluntarily terminates his employment for any reason within two years of the date of being admitted as a Member, the Company shall have the right to purchase all or any portion of the Class C Common Units held by such Member and such Member’s Family Group at the Purchase Price (as defined below) by delivering written notice to such Member within sixty (60) days after the termination of employment. If the Company has not exercised its right to purchase by delivering the notice set forth in the immediately preceding sentence or has not purchased all of the Class C Common Units held by such Member, the other Members shall have the right to purchase (pro rata on the basis of the number of Common Units held by all Members electing to purchase), all or any portion of the Class C Common Units held by such Member or such Member’s Family Group that were not purchased by the Company at the Purchase Price by delivering written notice to such Member within 75 days after termination of employment. “Purchase Price” shall mean with respect to any Class C Common Units held by such Member or such Member’s Family Group, the lower of (i) such Member’s original cost of such Class C Common Units plus a return of ten percent (10%) per annum or (ii) the Fair Market Value of such Class C Common Units (which
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Fair Market Value shall in no event be lower than the quotient of the unpaid amounts of principal and interest on all notes issued by such Member to the Company for the purchase of Class C Common Units divided by the number of Class C Common Units held by such Member and such Member’s Family Group). In the event that (x) the Company or the other Members do not elect to purchase any Class C Common Units pursuant to this Section 9.5(b) or (y) more than two years have passed since the date of such Member’s admittance as a member, such Class C Common Units may be held by such Member and such Member’s Family Group subject to the terms of this Agreement or may be transferred by the Member and such Member’s Family Group upon compliance with the other provisions of Article IX.
(c) Except as provided in Section 9.5(a) above, in the event a Member who is also an employee of the Company (or any Subsidiary thereof) involuntarily terminates his or her employment for any reason (including, without limitation, death or disability) or upon a material breach by the Company of his or her employment agreement with the Company (whether or not such employment or agreement exists on the date hereof), the Company shall have the right to purchase all or any portion of the Class C Common Units held by such Member and such Member’s Family Group at Fair Market Value (or at the lower of cost or Fair Market Value, if such Member is terminated for Cause) by delivering written notice to such Member within sixty (60) days after the termination of employment. If the Company has not exercised its right to purchase by delivering the notice set forth in the immediately preceding sentence or has not purchased all of the Class C Common Units held by such Member and such Member’s Family Group, the other Members shall have the right to purchase (pro rata on the basis of the number of Common Units held by all Members electing to purchase) all or any portion of the Class C Common Units held by such Member or such Member’s Family Group that were not purchased by the Company at Fair Market Value (or at the lower of cost or Fair Market Value, if such Member is terminated for Cause) by delivering written notice to such Member within 75 days after termination of employment. Notwithstanding the foregoing, at such Member’s option, unless such Member is terminated for Cause, such Member may elect to defer the sale of his or her Class C Common Units (and the determination of Fair Market Value) to the date which is the one year anniversary of his or her termination of employment. For the purposes of this Section 9.5, the reasonable expense of second and third valuations, if any, made pursuant to Section 2.1(b)(i) shall be borne by the Company. In the event that the Company and the other Members do not elect to purchase any Class C Common Units pursuant to this Section 9.5, such Class C Common Units may be held by such Member and such Member’s Family Group subject to the terms of this Agreement or may be transferred by the Member and such Member’s Family Group upon compliance with the other provisions of this Article IX.
(d) For purposes of this Section 9.5, Units owned by a Member shall include all options, rights and warrants to acquire Class C Common Units of the Company owned by such Member (provided that the Fair Market Value thereof in all events shall be net of any exercise price thereof); provided that, to the extent of any inconsistency, the terms contained in the documents pursuant to which such options, rights or warrants were granted shall govern.
(a) Except as otherwise provided in Section 9.6(b), no Unitholder shall have the power or right to withdraw or otherwise resign from the Company except, simultaneous with
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the Transfer of all of a Unitholder’s Units in a Transfer permitted by this Agreement and, if such Transfer is to a Person that is not a Unitholder, the admission of such person or entity as a Unitholder pursuant to Section 10.1.
(b) Notwithstanding any provision of this Agreement to the contrary, any Member may elect, upon written notice to the Managers, to withdraw from the Company, or make a partial withdrawal any time in the manner herein provided, if such Member shall obtain and deliver to the Managers an opinion of counsel (who may be independent counsel or an employee of such Member or an affiliate of such Member, and who shall be reasonably satisfactory to the Managers) that such Member has a Regulatory Problem or will have a Regulatory Problem if such Member were to continue as a Member or if such partial withdrawal were not effected. Upon such withdrawal, the Company shall repurchase such withdrawing Member’s Units at the lower of Fair Market Value upon the date of such withdrawal and Fair Market Value upon a Sale of the Company, assuming that such Units were still outstanding, with a subordinated note that shall mature and become due and payable on the fifth day following a Sale of the Company, shall be non-interest bearing, and shall otherwise have terms reasonably designated by the Managers.
9.7 Legend. In the event that certificates representing the Units are issued, such certificates will bear the following legend:
“THE UNITS REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED ON HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR APPLICABLE STATE SECURITIES LAWS (“STATE ACTS”) AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR STATE ACTS OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE TRANSFER OF THE UNITS REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE CONDITIONS SPECIFIED IN THE LIMITED LIABILITY COMPANY AGREEMENT, DATED AS OF FEBRUARY , 2004 GOVERNING THE ISSUER (THE “COMPANY”) AND BY AND AMONG ITS MEMBERS, AS SUCH MAY BE AMENDED FROM TIME TO TIME. A COPY OF SUCH CONDITIONS SHALL BE FURNISHED BY THE COMPANY TO THE HOLDER HEREOF UPON WRITTEN REQUEST AND WITHOUT CHARGE.”
9.8 Transfer Cost Considerations. Any capital gains, income, transfer, gift or other taxes imposed upon any transferor or transferee as a result of any conveyance of any interest in the Company shall be exclusively the responsibility of the person upon whom such tax is imposed; the Company shall have no responsibility whatsoever for such tax. In the event that any tax, expense (including legal and accounting fees) or cost is incurred by or imposed upon the Company as a result of any conveyance of an interest in the Company, except as a result of the Company’s issuing or purchasing any interest in the Company, the Member conveying such
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interest shall indemnify, or cause the transferee to indemnify, the Company for such tax, expense or cost.
ARTICLE X
ADMISSION OF MEMBERS
10.1 Substituted Members. In connection with the permitted transfer of a Unit, the transferee shall become a Substituted Member on the effective date of such transfer, which effective date shall not be earlier than the date of compliance with the conditions to such transfer (without the Managers or any Member consent unless one of the conditions to such transfer is that Managers or Member consent is required for the admission of such transferee, in which case such consent must first be obtained), and such admission shall be shown on the books and records of the Company.
10.2 Additional Members. Notwithstanding anything contained herein to the contrary, a Person may be admitted to the Company as an Additional Member and issued Units only upon furnishing to the Managers (a) a letter of acceptance, in form satisfactory to the Managers, of all the terms and conditions of this Agreement, and (b) such other documents or instruments as may be reasonably necessary or appropriate to effect such Person’s admission as a Member. Such admission shall become effective on the date that such conditions have been satisfied.
10.3 Optionholders. No person or entity that holds securities (including, without limitation, options, warrants or rights) exercisable, exchangeable or convertible into Units (“Optionholder”) shall have any rights with respect to such Units until such person or entity is actually issued Units upon such exercise, exchange or conversion and, if such person or entity is not then a Member, is admitted as a Member pursuant to Section 10.2. Each Optionholder that is also a Member agrees to be bound by all of the obligations of an Optionholder set forth herein, including, without limitation, those set forth in Section 9.3.
ARTICLE XI
INCORPORATION
If at any time the Managers (with Required Approval) approve the incorporation (whether by merger, exchange, contribution, a combination of the foregoing or otherwise) of the Company (whether in connection with a public offering of any of the equity securities of the Company to be registered under the Securities Act or otherwise), each Unitholder, each holder of rights to acquire units and the Company will take all necessary or desirable actions in connection with the incorporation of the Company and, if applicable, the consummation of such registered offering approved by the Managers, subject to Section 3.3(a). Without limiting the generality of the foregoing, each holder of Units hereby waives any dissenters rights, appraisal rights or similar rights in connection with any such incorporation of the Company and transactions entered into in connection therewith. The incorporation of the Company will be effected in such a manner so that, immediately thereafter, either (i) each Unitholder holds common stock having an aggregate value equal to the Fair Market Value of all of the Units held by such Unitholder immediately
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prior to such incorporation or (ii) each Unitholder receives one or more classes of capital stock that, to the fullest extent possible, maintain and contain terms reflecting, the relative rights and preferences of the Units previously held by such Unitholder. In no event shall the provisions of this Article XI abrogate or otherwise modify the rights or obligations, if any, of the holders of Units as set forth in the Registration Rights Agreement.
ARTICLE XII
LIQUIDATION
12.1 Dissolution. Upon dissolution of the Company, the assets of the Company shall be liquidated by the Managers (or a Liquidating Trustee appointed by the Managers, which may be a Member) as promptly as possible, but in an orderly and businesslike manner so as not to involve undue sacrifice, and will apply and distribute the proceeds thereof in the following priority, unless otherwise required by applicable law:
(a) to pay all creditors of the Company, in the order of priority provided by law; and
(b) after the payment of all debts, liabilities and obligations of the Company, to distribute to the Members their respective shares of the remaining assets, if any pursuant to Section 5.1(c).
12.2 Accounting. Within one hundred eighty (180) days after completion of final distributions, the Managers or Liquidating Trustee shall cause to be prepared by a firm of certified public accountants a statement setting forth the assets and liabilities of the Company as at the date of dissolution, which statement shall be furnished to all of the Members.
12.3 Compensation of Trustee. The Liquidating Trustee, if engaged, shall be entitled to receive reasonable compensation.
ARTICLE XIII
INDEMNITY
13.1 Indemnification. Every person (and the heirs, executors and administrators of such person) who is or was a Unitholder, Manager, officer, employee or agent of the Company or of any other company, including another company, partnership, joint venture, trust or other enterprise which such person serves or served as such at the request of the Company shall be indemnified by the Company against all judgments, payments in settlement (whether or not approved by court), fines, penalties and other reasonable costs and expenses (including fees and disbursements of counsel) imposed upon or incurred by such person in connection with or resulting from any action, suit, proceeding, investigation or claim, whether civil, criminal, administrative, legislative or other (including any criminal action, suit or proceeding in which such person enters a plea of guilty or nolo contendere or its equivalent), or any appeal relating thereto which is brought or threatened by any other person, governmental authority or instrumentality (herein called a “third-party action”) and in which such person is made a party or is otherwise involved by reason of his or her being or having been such
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Unitholder, Manager, officer, employee, or agent or by reason of any action or omission, or alleged action or omission by such person in his or her capacity as such Unitholder, Manager, officer, employee or agent if either (a) such person is wholly successful, on the merits or otherwise, in defending such third-party action or (b) in the judgment of a court of competent jurisdiction or, in the absence of such determination, in the judgment of the Managers of the Company, such person acted in good faith and in what he or she reasonably believed to be the best interest of the Company or such other company and, in addition, in any criminal action, had no reasonable cause to believe that his or her conduct was unlawful. In case such person is successful, on the merits or otherwise, in defending part of such action, or, in the judgment of such a court or the Managers, has met the applicable standard of conduct specified in the preceding sentence with respect to part of such action, he or she shall be indemnified by the Company against the judgments, settlement payments, fines, penalties, and other costs and expenses attributable to such part of such action.
The foregoing rights of indemnification shall be in addition to any rights which any such Unitholder, Manager, officer, employee or agent may otherwise be entitled.
In any case in which, in the judgment of the Managers, any such Member, Manager, officer or employee will be entitled to indemnification under the foregoing provisions of this Article XIII, such amounts as they deem necessary to cover the reasonable costs and expenses incurred by such person in connection with the action, suit, proceeding, investigation or claim prior to final disposition thereof may be advanced to such person upon receipt of an undertaking by or on behalf of such person to repay such amounts if it is ultimately determined that he or she is not so entitled to indemnification.
ARTICLE XIV
DEFINITIONS
14.1 Certain Definitions. For the purpose of this Agreement, the following terms have the meanings set forth below:
“Additional Member” means a Person admitted to the Company as a Member pursuant to Section 10.2.
“Adjusted Capital Account Deficit” means, with respect to any Unitholder, the deficit balance, if any, in such Unitholder’s Capital Account as of the end of the relevant Taxable Year, after giving effect to the following adjustments:
(i) Credit to such Capital Account any amounts which such Unitholder 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 Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and
(ii) Debit to such Capital Account the items described in Sections 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) of the Regulations.
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The foregoing definition of Adjusted Capital Account Deficit is intended to comply with the provisions of Section 1.704-1(b)(2)(ii)(d) of the Regulations and shall be interpreted consistently therewith.
“Affiliate” of any Person means any Person that directly or indirectly controls, is controlled by, or is under common control with the Person in question.
“Argosy Group” means Argosy, Canadian Imperial Bank of Commerce, CIBC WMV Inc., CIBC WMC Inc., CIBC Wood Gundy Ventures, Inc., Co-Investment Merchant Fund 2, L.L.C., any other Person designated as such pursuant to this definition, and each of their respective Affiliates, successors, and, to the extent that the assignor designates such assignee as a member of the “Argosy Group” by notifying the Company and the Unitholders, assigns.
“Base Rate” means a rate per annum equal to the United States corporate base rate announced by the Canadian Imperial Bank of Commerce from time to time, changing when and as such rate changes.
“BHCA Regulated Member” means any Member which is subject to Regulation Y of the Federal Reserve Board.
“Book Value” means, with respect to any Company property, the Company’s adjusted basis for federal income tax purposes, adjusted from time to time to reflect the adjustments required or permitted by Treasury Regulation Section 1.704-1(b)(2)(iv)( d)-(g).
“Capital Account” means the capital account maintained for a Member pursuant to Section 4.5.
“Capital Contribution” means any cash, cash equivalents, promissory obligations or the Fair Market Value of other property which a Member contributes or is deemed to have contributed to the Company pursuant to Section 4.1.
“Cause” means, with respect to any Member who is an employee of the Company (or any Subsidiary thereof), such Member’s (i) embezzlement or misappropriation of funds, (ii) conviction of a felony involving moral turpitude, (iii) commission of a material act of dishonesty, fraud, or deceit, (iv) breach of any material provisions of any employment agreement with the Company (or any Subsidiary thereof) to which he is a party, (v) habitual or willful neglect of his duties, (vi) breach of fiduciary duty to the Company (or any Subsidiary thereof) involving personal profit or (vii) material violation of any other duty to the Company (or any Subsidiary thereof) or its Members imposed by law or by the Managers.
“Certificate” means the Company’s certificate of formation filed with the Delaware Secretary of State.
“Class E Factor” means, as of the date of any Distribution, the fraction, (i) the numerator of which is the number of issued and outstanding Vested Class E Units as of the date of such Distribution and (ii) the denominator of which is 1,000.
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“CNIC” means Caravelle Norcross Investment Corporation, a Delaware corporation.
“Code” means the United States Internal Revenue Code of 1986, as amended from time to time. All references herein to sections of the Code shall include any corresponding provision or provisions of succeeding law to the extent the Managers determines that any such amendments do not adversely affect the relative economic interests of the Members hereunder.
“Common Units” means, collectively, the Class A Common Units, Class B Common Units, Class C Common Units and Class D Common Units. For avoidance of doubt, “Common Units” shall not include Class E Units or Preferred Units.
“Common Voting Units” means all of the Common Units other than the Class B Common Units and the Class D Common Units.
“Competitor” shall have the meaning ascribed to it in Section 9.1.
“Credit Agreement” means that Credit Agreement, dated October 2, 1998, among Norcross Safety Products L.L.C., North Safety Products Corp., Morning Pride Manufacturing L.L.C. and each of the other signatories thereto, as the same has been and may be amended, modified, supplemented or waived from time to time.
“Delaware Act” means the Delaware Limited Liability Company Act, 6 Del.L. § 18-101, et seq., as it may be amended from time to time, and any successor to the Delaware Act.
“Distribution” means each distribution made by the Company to a Member, whether in cash, property or securities of the Company and whether by liquidating distribution, redemption, repurchase or otherwise; provided that none of the following shall be a Distribution: (a) any redemption or repurchase by the Company of any securities, and (b) any recapitalization or exchange of securities of the Company, and any subdivision (by Unit split or otherwise) or any combination (by reverse Unit split or otherwise) of any outstanding Units.
“Effective Date” shall have the meaning ascribed to it in the Preamble.
“Exempt Transfer” shall have the meaning ascribed to it in Section 9.1.
“Family Group” means a Member’s spouse and descendants (whether natural or adopted) and any trust, partnership or corporation or similar entity created by or at the direction of a Member for the benefit of either the Member or the Member’s spouse and/or descendants and any Affiliates of the foregoing.
“Financing” means the purchase of Units by the SBIC Holder(s) hereunder from time to time.
“Fiscal Year” means the Company’s annual accounting period established pursuant to Section 6.2.
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“Freely Tradeable Securities” means securities: (i) which are of a class (a) of securities issued or fully guaranteed by the United States of America or any agency thereof and entitled to the full faith and credit of the United States of America, for which price quotations are routinely quoted and for which, in the opinion of a majority of the Managers, there is a ready liquid market; or (b) both registered pursuant to either Section 12(b) or Section 12 (g) of the 1934 Act and either listed on a national securities exchange or on the NASDAQ national market and (ii) which may be resold immediately in the public markets by each holder of Units without requirement of further registration under the Securities Act.
“Hancock” means John Hancock Life Insurance Company, a Massachusetts mutual life insurance company or its successors.
“Hancock Group” means Hancock, Hancock Mezzanine Partners L.P. any other Person designated as such pursuant to this definition, and each of their respective Affiliates, successors, and, to the extent that the assignor designates such assignee as a member of the “Hancock Group” by notifying the Company and the Unitholders, assigns.
“Independent Third Party” means any person who, immediately prior to the contemplated transaction, does not own in excess of 5% of the Company’s Common Units on a fully-diluted basis (a “5% Owner”), who is not controlling, controlled by or under common control with any such 5% Owner and who is not the spouse or descendent (by birth or adoption) of any such 5% Owner or a trust for the benefit of any such 5% Owner and/or such other persons.
“Investor” means a member of the Argosy Group or a member of the Hancock Group and “Investors” means, collectively, members of the Argosy Group and members of the Hancock Group.
“Losses” means items of Company loss and deduction determined according to Section 4.5.
“Member” means each of the members named on Schedule A attached hereto and any Person admitted to the Company as a Substituted Member or Additional Member; but only so long as such Person is shown on the Company’s books and records as the owner of one or more Units.
“Member Employee” means any Member who is or at any time was an employee of the Company or any Subsidiary.
“Person” means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
“Preferred Yield” means, with respect to each Preferred Unit, the amount accruing on such Preferred Unit on a daily basis, at the rate of 10% per annum, compounded on the last day of June and December of each year, on (a) the Unreturned Preferred Capital of such Preferred Unit plus (b) Unpaid Preferred Yield thereon, for all prior semi-annual periods. In
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calculating the amount of any Distribution to be made during a period, the portion of a Preferred Unit’s Preferred Yield for such portion of such period elapsing before such Distribution is made shall be taken into account.
“Profits” means items of Company income and gain determined according to Section 4.5.
“Public Sale” means any sale of Units to the public pursuant to an offering registered under the Securities Act or to the public through a broker, dealer or market maker pursuant to the provisions of Rule 144 (or any similar provision then in effect) adopted under the Securities Act.
“Redemption Distribution” means, with respect to any Preferred Unit at any time, an amount equal. to the sum of aggregate Unpaid Preferred Yield on such Preferred Unit and Unreturned Preferred Capital on such Preferred Unit at such time.
“Registration Rights Agreement” means the Amended and Restated Registration Rights Agreement, dated as of the date hereof, by and among the Company and the other signatories thereto (as the same may be amended, modified, supplemented or waived from time to time).
“Regulated Member” means any Member that provides satisfactory evidence to the Company that such Member’s investment is subject to regulation by a governmental authority (excluding securities laws), including a BHCA Regulated Member and an SBIC Holder.
“Regulatory Problem” means any transaction, circumstance or situation whereby (A) a Regulated Member and such Regulated Member’s Affiliates would own, control or have power over a greater quantity of securities of any kind issued by the Company or any other entity than are permitted under any requirement of any governmental authority, or would cause such Regulated Member to not be able to hold an investment in or provide financing to the Company in compliance with any applicable requirement of any governmental authority, or (B) it has been asserted by any governmental regulatory agency (or such Regulated Member believes that there is a risk of such assertion) that such Regulated Member and its Affiliates are not entitled to hold the Units held by such Regulated Member or exercise any significant right with respect to the Units held by such Person or provide financing to the Company in compliance with any applicable requirement of any governmental authority.
“Required Approval” means the approval of each of (i) members of the Argosy Group holding a majority of the Class A Common Units held by members of the Argosy Group or, in lieu thereof, a majority of the Argosy Managers and (ii) members of the Hancock Group holding a majority of the Class A Common Units held by members of the Hancock Group or, in lieu thereof, the Hancock Manager.
“Sale of the Company” means the sale of the Company to an Independent Third Party or group of Independent Third Parties pursuant to which such party or parties acquire (i) equity securities of the Company constituting a majority of the residual equity of the Company (whether by merger, consolidation, or sale or transfer of the Common Units or otherwise) or (ii) all or substantially all of Company’s assets determined on a consolidated basis.
38
“SBA” means the United States Small Business Administration, and any successor agency performing the functions thereof.
“SBIC” means a Small Business Investment Company licensed by an SBA under the SBIC Act.
“SBIC Act” means the Small Business Investment Act of 1958, as amended. “SBIC Holder” means any member which is an SBIC.
“SBIC Regulations” means the SBIC Act and the regulations issued by the SBA thereunder, codified at Title 13 of the Code of Federal Regulations (“13 CFR”), Parts 107 and 121.
“Subsidiary” means, with respect to any Person, (i) a corporation a majority of whose capital stock with voting power, under ordinary circumstances, to elect directors is at the time, directly or indirectly, owned by such Person and/or by one or more Subsidiaries thereof or (ii) any other Person (other than a corporation), including without limitation a joint venture, in which such Person, and/or one or more Subsidiaries thereof or such Person and one or more Subsidiaries thereof, directly or indirectly, at the date of determination thereof, has at least a majority ownership interest entitled to vote in the election of directors, managers or trustees thereof (or other persons performing similar functions). For purposes of this definition, any directors’ qualifying shares or investments by foreign nationals mandated by applicable law shall be disregarded in determining the ownership of a Subsidiary.
“Substituted Member” means a Person that is admitted as a Member to the Company pursuant to Section 10.1.
“Tax” or “Taxes” means federal, state, county, local, foreign or other income, gross receipts, ad valorem, franchise, profits, sales or use, transfer, registration, excise, utility, environmental, communications, real or personal property, capital stock, license, payroll, wage or other withholding, employment, social security, severance, stamp, occupation, alternative or add-on minimum, estimated and other taxes of any kind whatsoever (including, without limitation, deficiencies, penalties, additions to tax, and interest attributable thereto) whether disputed or not.
“Tax Return” means any return, information report or filing with respect to Taxes, including any schedules attached thereto and including any amendment thereof.
“Transfer” means any sale, transfer, assignment, pledge, mortgage, exchange, hypothecation, grant of a security interest or other direct or indirect disposition or encumbrance of an interest (including, without limitation, by operation of law) or the acts thereof, but explicitly excluding the conversions of one class of Common Unit to another class of Common Unit. The terms “Transferee,” “Transferred,” and other forms of the word “Transfer” shall have correlative meanings.
“Treasury Regulations” means the regulations promulgated by the United States Department of the Treasury pursuant to and in respect of provisions of the Code. All references herein to sections of the Treasury Regulations shall include any corresponding provision or
39
provisions of succeeding, similar, substitute, proposed or final Treasury Regulations to the extent the Managers determine that any such amendments and succeeding regulations do not adversely affect the relative economic interests of the Members hereunder.
“type” of Unit means a Preferred Unit or a Common Unit, as the case may be.
“Unit Exchange Agreement” means the Unit Purchase and Exchange Agreement, dated October 2, 1998, among the Company, Argosy-Safety Products, L.P., John Hancock Mutual Life Insurance Company, CIBC Wood Gundy Ventures, Inc., Co-Investment Merchant Fund, L.L.C., Hancock Mezzanine Partners L.P., Citizens Capital, Inc., Continental Illinois Venture Corp., Caravelle Investment Fund, L.L.C., CIBC Oppenheimer Corp. and Randolph Street Partners II.
“Unitholder” means any owner of one or more Units as reflected on the Company’s books and records.
“Unpaid Preferred Yield” of any Preferred Unit means, as of any date, an amount equal to the excess, if any, of (a) the aggregate Preferred Yield accrued on such Preferred Unit for all periods prior to such date, over (b) the aggregate amount of prior Distributions made by the Company that constitute payment of Preferred Yield on such Preferred Unit.
“Unreturned Preferred Capital” means, with respect to a Preferred Unit, the excess, if any, of (a) the Capital Contribution made in exchange for or on account of such Unit over (b) all Distributions made by the Company on account of such Preferred Unit after all Unpaid Preferred Yield on account of such Preferred Unit shall have been paid in full.
“Vested Class E Units” means any Class E Units which have vested in accordance with the terms of the Class E Unit Purchase Agreement pursuant to which such Class E Units were acquired.
14.2 Other Definitions. Capitalized terms used herein but not defined in Section 14.1 have the meaning given such term in the Section where such term is first defined in this Agreement.
ARTICLE XV
MISCELLANEOUS
15.1 Wills. Each Member who is a natural person agrees to execute a will which shall contain a direction and authorization to his or her personal representative, executor or administrator to comply with the provisions of this Agreement and to sell his or her Units, as the case may be, in accordance with this Agreement; provided, however, that the failure of any such Member to do so shall not affect the validity or enforceability of this Agreement.
15.2 Spousal Consent. Each married Member, and each such Member who, subsequent to the date hereof, marries or remarries, shall concurrently with his or her execution hereof deliver to the Managers the written consent of his or her spouse, substantially in the form
40
attached hereto as Schedule C; provided, however, that the failure of any such Member to do so shall not affect the validity or enforceability of this Agreement.
15.3 Third-Party Beneficiaries. This Agreement is not intended to nor will it confer upon any other person (other than the parties hereto) any rights or remedies; and this Agreement is binding upon and is solely for the benefit of the parties hereto and their respective successors, legal representatives and assigns.
15.4 Designees. Any rights granted to any Member of the Argosy Group may be delegated to any other Member of the Argosy Group and any rights granted to any Member of the Hancock Group may be delegated to any other Member of the Hancock Group.
(a) This Agreement may be amended only by the affirmative vote of a majority of the Common Voting Units (with Required Approval) or, as the result of an issuance or transfer permitted by this Agreement, by the Managers; provided that, no amendment or modification pursuant to this Section 15.5 that would adversely affect holders of one class of Units in a manner different than holders of any other class of Units (as the case may be) shall be effective against the holders of such class of Units without the prior written consent of holders of at least a majority of Units of such class so adversely affected thereby; provided further that, no amendment or modification pursuant to this Section 15.5 that would adversely affect a holder of one class or type of Units in a manner different than the other holders of the same class or type of Units shall be effective against such holder without the prior written consent of such holder; provided further that, no amendment or modification of Sections 2.7, 2.8, 2.9 or 2.10 shall be effective without the prior written consent of all Regulated Members affected thereby and no amendment or modification of Sections 2.11 or 2.12 shall be effective without the prior written consent of all of the SBIC Holders; provided further that no amendment or modification pursuant to this Section 15.5 that would affect the rights of a Member or group of Members specifically granted such rights by name shall be modified without that Member’s (or a majority of that group of Members’) consent; and provided further that amendments or modifications to the terms of the Class E Units shall be effective only upon the prior written consent of the holders of a majority of the Class E Units then outstanding.
(b) In the event that any amendment is to be made to Section 9.8 hereof, the foregoing required vote must include the votes of all affected employee Members and terminated employee Members. The Managers shall not enter into any other agreement that would have the effect of amending the provisions of this Agreement without the foregoing required vote.
15.6 Notices. Except as expressly set forth to the contrary in this Agreement, all notices, requests or consents provided for or permitted to be given under this Agreement must be in writing and shall be deemed delivered: (a) upon delivery if delivered in person; (b) upon transmission if sent via telecopier, with a confirmation copy sent via overnight mail, provided that confirmation of such overnight delivery is received; or (c) one (1) business day after deposit with a national overnight courier provided that confirmation of such overnight delivery is received. All notices, requests and consents to be sent to a Member or Unitholder must be sent to or made at the address given for that Member on Schedule A or such other address as that
41
Member or Unitholder may specify by notice to the other Members. Any notice, request, or consent to the Company or the Managers must be given to the Managers at the following address:
NSP Holdings L.L.C.
2211 York Road, Suite 215
Oak Brook, Illinois 60523-1887
Attention: Robert A. Peterson
Telecopy: (630) 572-8231
Whenever any notice is required to be given by law, the Certificate or this Agreement, a written waiver thereof, signed by the Person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice.
15.7 Waiver of Certain Rights. Each Member irrevocably waives any right it may have to demand any distributions or withdrawal of property from the Company or to maintain any action for dissolution of the Company or for partition of the property of the Company.
15.8 Entire Agreement. Except as provided in the Registration Rights Agreement, this Agreement constitutes the entire agreement of the Members and their affiliates relating to the Company and supersedes all prior contracts or agreements with respect to the Company, whether oral or written.
15.9 Effect of Waiver or Consent. A waiver or consent, express or implied, to or of any breach or default by any Person in the performance by that Person of its obligations with respect to the Company is not a consent or waiver to or of any other breach or default in the performance by that Person of the same or any other obligations of that Person with respect to the Company. Failure on the part of a Person to complain of any act of any Person or to declare any Person in default with respect to the Company, irrespective of how long that failure continues, does not constitute a waiver by that Person of its rights with respect to that default until the applicable statute-of-limitations period has run.
15.10 Creditors. None of the provisions of this Agreement shall be for the benefit of or enforceable by any creditors of the Company or any of its Affiliates, and no creditor who makes a loan to the Company or any of its Affiliates may have or acquire (except pursuant to the terms of a separate agreement executed by the Company in favor of such Creditor) at any time as a result of making the loan any direct or indirect interest in Company Profits, Losses, Distributions, capital or property other than as a secured creditor.
(a) If the Company is obligated to pay any amount to a governmental agency or body or, as directed by a court of competent jurisdiction or a governmental agency or body, to any other Person because of the status of a Member or otherwise specifically attributable to a Member (including, without limitation, federal withholding taxes with respect to foreign
42
partners, state personal property taxes, state unincorporated business taxes, etc.), then such Member (the “Indemnifying Person”) shall indemnify the Company in full for the entire amount paid (including, without limitation, any interest, penalties and expenses associated with such payment). At the option of the Managers, the amount to be indemnified may be charged against the Capital Account of the Indemnifying Person, and, at the option of the Managers, either:
(i) promptly upon notification of an obligation to indemnify the forth in the preceding sentence, shall be resolved by final and binding arbitration before a single arbitrator selected and serving under the Commercial Arbitration Rules of the American Arbitration Association. The arbitration shall be held in Wilmington, Delaware unless another location is mutually agreed upon by the parties to such arbitration. Such arbitration shall be the exclusive remedy hereunder. The decision of the arbitrator may, but need not, be entered as judgment in accordance with the provisions of the laws of Delaware. If this Arbitration provision is for any reason held to be invalid or otherwise inapplicable to any dispute, the parties hereto agree that any action or proceeding brought with respect to any dispute arising under this Agreement, or to interpret or clarify any rights or obligations arising hereunder, shall be maintained solely and exclusively in the United States Federal Courts, venue in Wilmington, Delaware.
(b) Anything set forth in the foregoing paragraph notwithstanding, the Unitholders agree that the exclusive procedure for resolving disputes over the determination of Fair Market Value shall be as set forth in Section 2.1(b) of this Agreement. All Unitholders and the Company shall be bound by the determination of Fair Market Value made in accordance therewith. Accordingly, the Unitholders agree that no arbitration, or action or proceeding in any court or other tribunal, shall be brought with respect to any dispute over the determination of Fair Market Value.
15.12 Descriptive Headings; Interpretation. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a substantive part of this Agreement. Whenever required by the context, any pronoun used in this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and verbs shall include the plural and vice versa. The use of the word “including” in this Agreement shall be by way of example rather than by limitation. Reference to any agreement, document or instrument means such agreement, document or instrument as amended or otherwise modified from time to time in accordance with the terms thereof, and if applicable hereof. Without limiting the generality of the immediately preceding sentence, no amendment or other modification to any agreement, document or instrument that requires the consent of any Person pursuant to the terms of this Agreement or any other agreement will be given effect hereunder unless such Person has consented in writing to such amendment or modification. Wherever required by the context, references to a Fiscal Year shall refer to a portion thereof. The use of the words “or,” “either” and “any” shall not be exclusive. The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement. Wherever a conflict exists between this Agreement and any other agreement, except as otherwise provided in this Agreement, this Agreement shall control but solely to the extent of such conflict.
43
15.13 Further Assurances. In connection with this Agreement and the transactions contemplated hereby, each Unitholder shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriated to effectuate and perform the provisions of this Agreement and those transactions.
15.14 Counterparts. This Agreement may be executed in any number of counterparts with the same effect as if all signing parties had signed the same document. All counterparts shall be construed together and constitute the same instrument.
15.15 Representations and Warranties of Unitholder. In connection with any Capital Contribution for which a Unitholder receives Units hereunder or any other transaction hereunder in which a Unitholder receives Units, such Unitholder represents and warrants to the Company that:
(a) The Units to be acquired by such Unitholder pursuant to this Agreement will be acquired for such Unitholder’s own account and not with a view to, or intention of, distribution thereof in violation of any applicable securities laws, and the Units will not be disposed of in contravention of any such laws.
(b) In the case of a Unitholder that is a natural person, such Unitholder is a director, executive officer, or general partner of the Company or in the case of a Unitholder that is an entity, such Unitholder is an organization described in Section 501(c)(3) of the Internal Revenue Code of 1986, as amended, a corporation, limited liability company or partnership, or a Massachusetts or similar business trust, which entity was not formed for the specific purpose of making an investment in the Company and has total assets in excess of $5,000,000.
(c) Such Unitholder is sophisticated in financial matters and is able to evaluate the risks and benefits of the investment in the Units.
(d) Such Unitholder is able to bear the economic risk of his investment in the Units for an indefinite period of time because the Units have not been registered under any applicable securities laws and, therefore, cannot be sold unless subsequently registered under all applicable securities laws or an exemption therefrom is available.
(e) Such Unitholder has had an opportunity to ask questions and receive answers concerning the terms and conditions of the offering of Units and has had full access to such other information concerning the Company as he has requested and each such Unitholder is making the investment independently of, and without reliance on, all other Unitholders.
(f) This Agreement constitutes the legal, valid and binding obligation of such Unitholder, enforceable in accordance with its terms, and the execution, delivery and performance of this Agreement by such Unitholder does not and will not conflict with, violate or cause a breach of any agreement, contract or instrument to which such Unitholder is a party or any judgment, order or decree to which such Unitholder is subject.
15.16 Representations and Warranties of Company. In connection with any Capital Contribution for which a Unitholder receives Units or any other transaction hereunder in which a Unitholder receives Units, the Company represents and warrants to such Unitholder that:
44
(a) Organization; Power and Authority. The Company is a limited liability company, duly formed, validly existing and in good standing under the Delaware Limited Liability Company Act. The Company is not qualified as a foreign limited liability company in any jurisdiction. The Company has all requisite power and authority to own or hold under lease the properties it purports to own or hold under lease, to transact the business it proposes to transact, to execute and deliver this Agreement and the Units and to perform the provisions hereof and thereof except where the failure to hold such power or authority would not have a material adverse effect on the Company and its subsidiaries taken as a whole.
(b) Authorization. This Agreement and the issuance of the Units have been duly authorized by the Company, and this Agreement constitutes the legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, subject, in the case of enforcement, to bankruptcy, fraudulent transfer, reorganization, moratorium and other laws of general applicability relating to creditor’s rights and to general equity principles. Upon issuance, the Units will be validly issued and fully paid to the extent payment has been made in full. The issuance of the Units hereunder is not subject to any preemptive rights which have not been waived.
(c) Ownership. Schedule D is a complete and correct list of direct and indirect subsidiaries of the Company. Each subsidiary of the Company is a corporation or limited liability company, duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation or formation and is duly qualified as a foreign corporation or limited liability company in each jurisdiction in which the failure to be so qualified would have a material adverse effect on the Company and its subsidiaries taken as a whole. Each such subsidiary has the power and authority to own or hold under lease the properties it purports to own or hold under lease and to transact the business it transacts and proposes to transact except where the failure to hold such power or authority would not have a material adverse effect on the Company and its subsidiaries taken as a whole.
(d) Compliance with Laws; Conflicts. The execution, delivery and performance by the Company of this Agreement and the issuance of the Units will not (i) contravene, result in a breach of or constitute a default under, or result in the creation of any lien in respect of any property of the Company or any subsidiary under the organizational documents of any of them or under any material instrument or agreement to which they are parties or by which their respective properties are bound, or (ii) conflict with or result in the breach of any of the terms or provisions of any order, judgment, decree or ruling of any court or governmental authority applicable to the Company or any of its subsidiaries or violate any provision of any statute or other rule or regulation of any governmental authority applicable to the Company or any of its subsidiaries, except those contraventions, breaches, defaults, creations of liens or other requirements described above which would not have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(e) Governmental Authorizations. No consent, approval or authorization of, or registration with any governmental authority is required in connection with the execution, delivery or performance by the Company of the Agreement or the issuance of the Units, other than compliance with applicable state and federal securities laws, and except where the failure to
45
obtain such consents, approvals, authorizations, or registrations would not have a material adverse effect on the Company and its subsidiaries, taken as a whole.
(f) Private Offering. Assuming the accuracy of the representations contained in Section 15.18 hereof, the Company has not violated any state or federal securities laws in connection with the offer and sale of the Units in the manner contemplated by this Agreement and registration under the Securities Act is not required.
(g) Use of Proceeds. Neither the Company nor any subsidiary owns or has any present intention of acquiring any “margin stock” as defined in Regulation U (12 CFR Part 221) of the Board of Governors of the Federal Reserve System (“margin stock”). None of the proceeds of the sale of the Units will be used, directly or indirectly, for the purpose, whether immediate, incidental or ultimate, of purchasing or carrying any margin stock or for the purpose of maintaining, reducing or retiring any indebtedness which was originally incurred to purchase or carry any stock that is currently a margin stock or for any other purpose which might constitute this transaction a “purpose credit” within the meaning of such Regulation U.
(h) Indebtedness. The Company has made available to the Members true, complete and correct copies of each of the material agreements for indebtedness for borrowed money to which the Company and its subsidiaries are party (the “Credit Agreements”) and all other instruments and agreements executed in connection therewith and which are in effect on the date hereof.
(i) Status under Certain Statutes. The Company is not required to be registered as an “investment company” under the Investment Company Act and is not subject to regulation under the Public Utilities Holding Company Act.
(j) Credit Agreements. To the best of the Company’s knowledge, the representations and warranties made by the Company or an Affiliate contained in the Credit Agreement were true and correct in all material respects when made.
(k) Solvency. After giving effect to the transactions contemplated hereby, to the best of the Company’s knowledge, as of the date hereof, the aggregate fair saleable value of the assets of the Company on a consolidated basis exceeds the amount required to pay its non-contingent liabilities (assuming all of its debt is refinanced at maturity).
(l) Violations of Certain Laws. Neither the sale of the Units by the Company hereunder nor its use of the proceeds thereof will violate the Trading with the Enemy Act, as amended, or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling legislation or executive order relating thereto.
46
| CIBC WMV, INC. | |
| | | |
| By: | /s/ JAY R. BLOOM | |
| | | |
| Its: | | |
| | | |
| CIBC WG ARGOSY MERCHANT FUND 1, LP | |
| | | |
| By: | /s/ JAY R. BLOOM | |
| | | |
| Its: | | |
| | | |
| CO-INVESTMENT MERCHANT FUND 2, L.L.C. | |
| | | |
| By: | /s/ JAY R. BLOOM | |
| | | |
| Its: | | |
| | | |
| CONTINENTAL CASUALTY COMPANY | |
| | | |
| By: | /s/ MARILOU R. MCGIRR | |
| | | |
| Its: | VICE PRESIDENT AND ASSISTANT CONTROLLER | |
| | | |
| | | |
| ROBERT A. PETERSON | |
| | | |
| By: | /s/ ROBERT A. PETERSON | |
| | | |
| DAVID F. MYERS, JR. | |
| | | |
| By: | /s/ DAVID F. MYERS, JR. | |
| | | |
| ROBERT J. LARSEN | |
| | | |
| By: | | |
| | | |
| WILLIAM L. GRILLIOT | |
| | | |
| By: | /s/ WILLIAM L. GRILLIOT | |
| | | |
| MARY G. GRILLIOT | |
| | | |
| By: | /s/ MARY G. GRILLIOT | |
| | | |
| JOHN HANCOCK LIFE INSURANCE COMPANY | |
| | | |
| By: | /s/ STEVEN J. BLEWITT | |
| | | |
| Its: | SENIOR MANAGING DIRECTOR | |
| | | |
| HANCOCK MEZZANINE PARTNERS L.P. | |
| | | |
| By: | JOHN HANCOCK LIFE INSURANCE COMPANY | |
| | | |
| By: | /s/ STEVEN J. BLEWITT | |
| Its: | SENIOR MANAGING DIRECTOR | |
| | | |
| CITIZENS CAPITAL, INC. | |
| | | |
| By: | /s/ DAVID MORRIS | |
| | | |
| Its: | DIRECTOR | |
| | | |
| CONTINENTIAL ILLINOIS VENTURES CORP. | |
| | | |
| By: | /s/ MARCUS D. WEDNER | |
| | | |
| Its: | | |
| | | |
| CARAVELLE INVESTMENT FUND, L.L.C. | |
| | | |
| By: | /s/ JAY R. BLOOM | |
| | | |
| Its: | | |
| | | |
| CARAVELLE NORCROSS INVESTMENT CORPORATION | |
| | | |
| By: | /s/ JAY R. BLOOM | |
| | | |
| Its: | | |
| | | |
| THE ALBION ALLIANCE MEZZANINE FUND, L.P. | |
| | | |
| By: | /s/ CHARLIE GONZALES | |
| | | |
| Its: | MANAGING DIRECTOR | |
| | | |
| ALLIANCE INVESTMENT OPPORTUNITIES FUND | |
| | | |
| By: | /s/ JAMES E. KENNEDY, JR. | |
| | | |
| Its: | AUTHORIZED SIGNATORY | |
| | | |
| RANDOLPH STREET PARTNERS II | |
| | | |
| By: | /s/ RICHARD J. CAMPBELL | |
| | | |
| Its: | | |
[ Signature Page to Limited Liability Company Agreement ]
SCHEDULE A
| | Total
Capital
Contribution in
Respect of
Common Units | | Total
Capital
Contribution in
Respect of
Preferred Units | | Total
Capital
Account Balance | | Total
Preferred
Units | | Total
Class A
Common Units | | Total
Class B
Common Units | | Total
Class C
Common Units | | Total
Class D
Common Units | | Total
Class E Units | |
CIBC WMV Inc.
425 Lexington Avenue, 3rd Floor
New York, NY 10017
Attn: Jay Bloom
Phone (212) 885-4474
Telecopy (212) 885-4934 | | $ | 1,513,758 | | $ | 2,811,265 | | $ | 4,325,023 | | 257,179.0 | | 257,179.0 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
CIBC WG Argosy Merchant Fund 1, LP.
425 Lexington Avenue, 3rd Floor
New York, NY 10017
Attn: Jay Bloom
Phone (212) 885-4474
Telecopy (212) 885-4934 | | | 6,548,594 | | | 12,173,345 | | | 18,721,939 | | 1,113,636.9 | | 1,112,646.3 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
Co-Investment Merchant Fund 2, LLC
425 Lexington Avenue, 3rd Floor
New York, NY 10017
Attn: Jay Bloom
Phone (212) 885-4474
Telecopy (212) 885-4934 | | | 727,622 | | | 1,352,594 | | | 2,080,216 | | 123,737.5 | | 123.627.4 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
Argosy-Safety Products, L.P.
425 Lexington Avenue, 3rd Floor
New York, NY 10017
Attn: Jay Bloom
Phone (212) 885-4474
Telecopy (212) 885-4934 | | | 2,662,013 | | | 4,946,668 | | | 7,608,681 | | 452,529.1 | | 452,280.5 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
Robert A. Peterson
11571 Burr Oak Lane
Burr Ridge, IL 60525
Phone (630) 662-0113 | | | 1,257,634 | | | 655,813 | | | 1,913,447 | | 59,994.8 | | 121,412.4 | | — | | 92,261.7 | | — | | 514.2857 | |
| | | | | | | | | | | | | | | | | | | | | | |
David F. Myers, Jr.
1302 Scott Avenue
Winnetka, IL 60093
Phone (847) 446-9818 | | | 779,749 | | | 401,305 | | | 1,181,054 | | 36,712.0 | | 74,355.8 | | — | | 58,124.8 | | — | | 342.8571 | |
| | | | | | | | | | | | | | | | | | | | | | |
Robert Larsen
6770 Spirit Lake Drive No. 402 Indianapolis, IN 46220 Phone: (317) 205-8426 | | | 466,940 | | | 485,409 | | | 952,349 | | 44,406.0 | | 45,197.00 | | — | | 34,136.9 | | — | | — | |
1
| | Total
Capital
Contribution in
Respect of
Common Units | | Total
Capital
Contribution in
Respect of
Preferred Units | | Total
Capital
Account Balance | | Total
Preferred
Units | | Total
Class A
Common Units | | Total
Class B
Common Units | | Total
Class C
Common Units | | Total
Class D
Common Units | | Total
Class E Units | |
William Grilliot
One Innovation Court
Dayton, OH 45414
Phone (937) 454-4925
Fax (937) 264-2677 | | $ | 36,797 | | $ | 142,683 | | $ | 179,480 | | | 13,052.9 | | | 13,045.8 | | | — | | | — | | | — | | | 42.8571 | |
| | | | | | | | | | | | | | | | | | | | | | |
Mary Grilliot
One Innovation Court
Dayton, OH 45414
Phone (937) 454-4925
Fax (937) 264-2677 | | | 36,797 | | | 142,683 | | | 179,480 | | 13,052.9 | | 13,045.8 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
John Hancock Life Insurance Company
200 Clarendon Street
Boston, MA 02117
Attn: Stephen Blewitt
Phone (617) 572-9624
Telecopy (617) 450-8053 | | | 11,115,151 | | | 20,670,314 | | | 31,785,465 | | 1,890,952.9 | | 1,888,586.0 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
Hancock Mezzanine Partners, L.P.
200 Clarendon Street
Boston, MA 02117
Attn: Stephen Blewitt
Phone (617) 572-9624
Telecopy (617) 450-8053 | | | 6,239,706 | | | 11,588,026 | | | 17,827,732 | | 1,060,091.1 | | 1,060,091.1 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
2
| | Total
Capital
Contribution in
Respect of
Common Units | | Total
Capital
Contribution in
Respect of
Preferred Units | | Total
Capital
Account Balance | | Total
Preferred
Units | | Total
Class A
Common Units | | Total
Class B
Common Units | | Total
Class C
Common Units | | Total
Class D
Common Units | | Total
Class E Units | |
Citizens Capital, Inc.
28 State Street, 15th Floor
Boston, MA 02109
Attn: David Morris
Phone (617) 725-5720
Telecopy (617) 725-5630
| | $ | 1,247,941 | | $ | 2,317,605 | | $ | 3,565,546 | | 212,018.2 | | — | | — | | — | | 212,018.2 | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
CIVC Partners Fund, L.P. (Continental Illinois Venture Corp.) 231 South LaSalle Street
Chicago, IL 60697
Attn: Marcus Wedner
Phone (312) 828-8133
Telecopy (312) 987-0887
| | | 6,239,707 | | | 11,588,026 | | | 17,827,733 | | 1,060,091.2 | | 1,060,091.2 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
Caravelle Private Investment Corporation
425 Lexington Avenue, 2nd Floor
New York, NY 10017
Attn: Jay Bloom
Phone (212) 885-4474
Telecopy (212) 885-4934 | | | 1,750,000 | | | 3,250,000 | | | 5,000,000 | | 297,315.2 | | 297,315.2 | | — | | — | | — | | — | |
3
| | Total
Capital
Contribution in
Respect of
Common Units | | Total
Capital
Contribution in
Respect of
Preferred Units | | Total
Capital
Account Balance | | Total
Preferred
Units | | Total
Class A
Common Units | | Total
Class B
Common Units | | Total
Class C
Common Units | | Total
Class D
Common Units | | Total
Class E Units | |
Caravelle Norcross Investment
Corporation 425 Lexington Avenue, 2nd Floor
New York, NY 10017
Attn: Jay Bloom
Phone (212) 885-4474
Telecopy (212) 885-4934 | | $ | 347,402 | | $ | 645,176 | | $ | 992,578 | | 59,021.7 | | 59,021.7 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
Continental Casualty Company (Loews Corporation) 667 Madison Avenue, 7th Floor
New York, NY 10021
Attn: Kevin Cuskley
Phone (212) 521-2730
Telecopy (212) 521-2858 | | | 1,663,922 | | | 3,090,140 | | | 4,754,062 | | 282,690.9 | | 282,690.9 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
AA-NSP I (formerly, The Albion Alliance Mezzanine Fund, L.P.)
1345 Avenue of the Americas
New York, NY 10105
Attn: Charles Gonzales
Phone (212) 969-1587
Telecopy (212) 969-1529 | | | 1,254,482 | | | 2,332,078 | | | 3,586,560 | | 213,342.2 | | 213,144.7 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
Alliance Investment Opportunities Fund
1345 Avenue of the Americas
New York, NY 10105
Attn: Charles Gonzales
Phone (212) 969-1587
Telecopy (212) 969-1529 | | | 875,000 | | | 1,625,000 | | | 2,500,000 | | 148,657.6 | | 148,657.6 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
Randolph Street Partners II
200 East Randolph Drive
Chicago, IL 60601
Attn: Jack S. Levin
Phone (312) 861-2000
Telecopy (312) 861-2200 | | | 255,537 | | | 474,849 | | | 730,386 | | 43,439.9 | | 43,416.2 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | |
Charles S. Ellis
237 Camelot Court
Knoxville, TN 37922
Telecopy: (401) 946-6125 | | — | | — | | — | | — | | — | | — | | — | | — | | 42.8571 | |
4
| | Total
Capital
Contribution in
Respect of
Common Units | | Total
Capital
Contribution in
Respect of
Preferred Units | | Total
Capital
Account Balance | | Total
Preferred
Units | | Total
Class A
Common Units | | Total
Class B
Common Units | | Total
Class C
Common Units | | Total
Class D
Common Units | | Total
Class E Units | |
Ken Martell
696 Wedgewood Dr.
Crystal Lake, IL 60014 | | $ | — | | $ | — | | $ | — | | | — | | | — | | | — | | | — | | | — | | | 28.5714 | |
| | | | | | | | | | | | | | | | | | | |
Jeff Morris
121 S. Summit St.
Wheaton, IL 60187 | | — | | — | | — | | — | | — | | — | | — | | — | | 14.2858 | |
| | | | | | | | | | | | | | | | | | | |
Total | | $ | 45,018,752 | | $ | 80,692,979 | | $ | 125,711,731 | | | 7,381,921.9 | | $ | 7,265,804.5 | | $ | — | | | 184,523.4 | | | 212,018.2 | | | 985.7142 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
5
SCHEDULE B
Intentionally Omitted
SCHEDULE C
CONSENT OF SPOUSE
I acknowledge that I have read the foregoing Limited Liability Company Agreement (the “Agreement”) and that I understand and am aware of its contents. I am aware that by its provisions, my spouse agrees to certain restrictions on all of his or her certificates of Membership interest in the Company (the “Units”), including any community interest or other interest which I may possess in the Units. I hereby approve of the provisions of the Agreement, and agree that all shares now owned by my spouse, and my interest in such Units, are subject to the provisions of the Agreement and that I will take no action at any time to hinder the performance of the Agreement or to commit or omit any act which would have a material adverse effect upon the ability of any party to perform pursuant to the Agreement.
7
SCHEDULE D
SUBSIDIARIES
Subsidiary | | Jurisdiction of
Organization | | Company or
Subsidiary that owns
such Subsidiary | | Percentage
Owned | |
Norcross Safety Products L.L.C. | | Delaware | | NSP Holdings L.L.C. | | 100 | % |
Norcross Capital Corp. | | Delaware | | Norcross Safety Products L.L.C. | | 100 | % |
Morning Pride Manufacturing L.L.C. | | Delaware | | Norcross Safety Products L.L.C. | | 100 | % |
North Safety Products Inc. | | Delaware | | Norcross Safety Products L.L.C. | | 100 | % |
North Safety Products Pty Ltd. | | South Africa | | Norcross Safety Products L.L.C. | | 100 | % |
Rocsi (Pty) Ltd. | | Channel Islands | | North Safety Products Pty Ltd. | | 100 | % |
James North Zimbabwe Pvt. Ltd. | | Zimbabwe | | Rocsi (Pty) Ltd. | | 66.67 | % |
Valhalla Pty Ltd. | | South Africa | | North Safety Products Pty Ltd. | | 100 | % |
James North Natal Pty Ltd. | | South Africa | | North Safety Products Pty Ltd. | | 100 | % |
Arrow Glove Works Pty Ltd. | | South Africa | | North Safety Products Pty Ltd. | | 100 | % |
Industrie Shutz Produkte GmbH | | Germany | | North Safety Products Inc. | | 100 | % |
North Safety Products Ltd. | | England | | North Safety Products Inc. | | 100 | % |
Salisbury Export Corporation -FSC | | Virgin Islands | | North Safety Products Inc. | | 100 | % |
Siebe North International Inc. --FSC | | Virgin Islands | | North Safety Products Inc. | | 100 | % |
North Safety Products Ltd. | | Canada | | North Safety Products Inc. | | 100 | % |
North Safety Mexico Holdings LLC | | Delaware | | North Safety Products Inc. | | 100 | % |
Siebe North SA | | Haiti | | North Safety Products Inc. | | 100 | % |
North Safety Products de Mexicali S de R.L. de C.V. | | Mexico | | Norcross Safety Products LLC. (99%) North Safety Mexico Holdings LLC (1%) | | 100 | % |
Subsidiary | | Jurisdiction of
Organization | | Company or
Subsidiary that owns
such Subsidiary | | Percentage
Owned | |
North Safety de Mexicali S de RL de C.V. | | Mexico | | Norcross Safety Products LLC. (95.67%) North Safety Mexico Holdings LLC (4.33%) | | 100 | % |
Arkon Safety UK Ltd. | | England | | North Safety Products Inc. | | 100 | % |
North Safety Products (Europe) B.V. | | Netherlands | | North Safety Products Ltd (Canada) — 100% of common stock Arkon Safety UK Ltd — 100% of preferred stock | | 100 | % |
Arbin Velligheid B.V. | | Netherlands | | North Safety Products (Europe) B.V. | | 100 | % |
Arbin Personal Protection Beheer B.V. | | Netherlands | | Arbin Velligheid B.V. | | 100 | % |
Arbin Personal Protection B.V. | | Netherlands | | Arbin Personal Protection Beheer B.V. | | 100 | % |
North Safety Products Holding GmbH | | Germany | | North Safety Products Inc. | | 100 | % |
Kachele-Cama Latex GmbH | | Germany | | North Safety Products Holding GmbH | | 100 | % |
Kachele Cama Nederland B.V. | | Netherlands | | North Safety Products Holding GmbH | | 100 | % |
KCL CZ s.v.o. | | Czech Republic | | Kachele-Cama Latex GmbH | | 60 | % |
Note that the Company also has a joint venture interest in Anhui Norcross Safety Products Co. Ltd. and has equity interests in each of the following:
KCL Guba Kft | | Hungary | | Kachele-Cama Latex GmbH | | 50 | % |
KCL SK s.v.o. | | Slovakia | | Kachele-Cama Latex GmbH | | 50 | % |
