EXHIBIT 3.31
OPERATING AGREEMENT OF
99 RESTAURANTS OF VERMONT, LLC,
A VERMONT LIMITED LIABILITY COMPANY
ORGANIZED UNDER CHAPTER 21 OF TITLE 11,
VERMONT STATUTES ANNOTATED
ARTICLE I. INITIAL DATE, PARTIES, AUTHORIZATION,
AND PURPOSE OF THIS AGREEMENT
SECTION 1.01 INITIAL DATE; INITIAL PARTIES
This Agreement is first made as of the 15th day of November, 2002 and
is initially agreed to by 99 Restaurants of Vermont, LLC ("the Company") and 99
Restaurants, LLC, a Delaware limited liability company, which on that date is
the Sole Member of the Company.
SECTION 1.02 SUBSEQUENT PARTIES; ASSENT AS A PRECONDITION TO BECOMING A
MEMBER OR TO OBTAINING RIGHTS TO BECOME A MEMBER
(a) No person may become a Member of the Company without first
assenting to and signing this Agreement. Any act by the Company to offer or
provide Member status, or reflect that status in the Company's Required Records,
automatically includes the condition that the person becoming a Member first
assent to and sign this Agreement.
(b) If:
(1) the Company offers, makes, or signs a Contribution
Agreement or Contribution Allowance Agreement, or any
other agreement that permits or requires a person to
make a contribution and become a Member, and
(ii) the other party to the Contribution Agreement,
Contribution Allowance Agreement, or other agreement
is not already a Member and has not already assented
to and signed this Agreement, then the Company's
action automatically includes the condition that the
other party assent to and sign this Agreement before
that person actually makes a contribution or becomes
a Member.
(c) The Company is obligated not to accept a contribution from, or
accord Member status to, any person who has not first assented to and signed
this Agreement. The Company's acceptance of a contribution from a person who has
not signed this Agreement does not waive that person's obligation to sign this
Agreement.
(d) No transfer of a Membership Unit or the governance rights of any
Membership Unit is effective unless the assignment complies with Section 12.02
and the assignee has assented to and signed this Agreement.
SECTION 1.03 AUTHORIZATION OF THIS AGREEMENT
This Agreement is made under Section 3003 of Title 11, Vermont Statutes
Annotated.
ARTICLE II. DEFINITIONS
SECTION 2.01 DEFINITIONS
For purposes of this Agreement, unless the language or context clearly
indicates that a different meaning is intended, the words, terms and phrases
defined in this section have the following meanings:
(a) "Act of the members" has the meaning stated in Section 10.01.
(b) "Agreement" means this Operating Agreement, as amended from time to
time under Article XVIII.
(c) "Capital Account" means the account of any Member or Dissociated
Member, maintained as provided in Section 7.02.
(d) "Capital Interest" means the right of any Member or dissociated
Member to be paid the amount in that Member's or Dissociated Member's Capital
Account.
(e) "Code" means the Internal Revenue Code of 1986, as amended, and any
successor to that Code.
(f) "Company" means 99 Restaurants of Vermont, LLC, a Limited Liability
Company, organized under Vermont Code Chapter 21 of Title 11, Vermont Statutes
Annotated.
(g) "Contribution Agreement" means an agreement between a person and
the Company, under which:
(i) the person agrees to make a contribution in the
future to the Company;
(ii) the Company agrees that, at the time specified for
the contribution in the future, the Company will
accept the contribution, reflect the contribution in
the Required Records, issue to the person a specified
number of Membership Units, and accord the person
status as a Member (if the person is not already a
Member).
2
(h) "Contribution Allowance Agreement" means an agreement between a
person and the Company, under which:
(1) the person has the right, but not the obligation, to
make a contribution to the Company in the future; and
(2) the Company agrees that, if the person makes the
specified contribution at the time specified in the
future, the Company will accept the contribution,
reflect the contribution in the Required Records,
issue to the person a specified number of Membership
Units, and accord the person status as a Member (if
the person is not already a Member).
(i) "Core business" means the Company's business involving the
provision of management of restaurants in the state of Vermont.
(j) "Default rule" means a rule stated in the Act:
(1) which structures, defines, or regulates the finances,
governance, operations, or other aspects of a limited
liability company organized the Act, and
(2) which applies except to the extent it is negated or
modified through the provisions of a limited
liability company's articles of organization or
operating agreement.
(k) "Disinterested" means, with respect to a Member and with respect to
a particular transaction or other undertaking, a Member who (i) is not a party
to that undertaking, (ii) has no material financial interest in any organization
that is a party to that undertaking, and (iii) is not related by blood or
marriage to any person who either is a party to that undertaking or has a
material financial interest in any organization that is a party to that
undertaking.
(l) "Dissociation of a Member" or "Dissociation" occurs when the
Company has notice or knowledge of an event that has terminated a Member's
continued Membership in the Company (including an event that leaves a Member
without any Governance Rights).
(m) "Financial Rights" means a Member's rights to share in profits and
losses, a Member's rights to receive distributions and a Member's Capital
Interest.
(n) "Fiscal Year" means the annual period upon which the Company files
its federal tax return.
(o) "Governance Rights" means all a Member's rights as a Member in the
Company, other than financial rights and the right to assign financial rights.
3
(p) "LLC Act" means Chapter 21 of Title 11, Vermont Statutes Annotated.
(q) Reserved.
(r) "Majority-In-Interest Consent" means the consent described in
Revenue Procedure 94-46, 1994-28 IRB 129, as amended from time to time.
(s) "Member" means a person who owns at least one Membership Unit and
whose ownership of one or more Membership Units is reflected in the Required
Records.
(t) "Membership Unit" has the meaning stated in Section 5.01.
(u) "Person" includes a natural person, domestic or foreign limited
liability company, corporation, partnership, limited partnership, joint venture,
association, business trust, estate, trust, enterprise, and any other legal or
commercial entity.
(v) "Required Records" means those records that Section 3058 of Title
11, Vermont Statutes Annotated requires the Company to maintain.
(w) "Successor LLC" means a limited liability company organized under
Section 15.02 to participate as the surviving organization in a merger with the
Company after the Company is dissolved.
(x) "Termination of the Company" means, as defined in Section 3101 of
Title 11, Vermont Statutes Annotated the end of the Company's legal existence.
(y) "Transfer" includes an assignment, conveyance, lease, mortgage,
security interest, deed, encumbrance, and gift.
ARTICLE III. BACKGROUND OF THIS AGREEMENT
SECTION 3.01 HISTORY AND NATURE OF THE COMPANY
The Company has been organized in Vermont and will be engaged in the
business of restaurant ownership and management. As of the initial date of this
Agreement, the Company's principal place of business is 3038 Sidco Drive,
Nashville, Tennessee 37204.
SECTION 3.02 INTENT OF THIS AGREEMENT
(a) The parties to this Agreement have reached an understanding
concerning various aspects of (i) their business relationship with each other
and (ii) the organization and operation of the Company and its business. They
wish to use rights created by statute to record and bind themselves to that
understanding.
4
(b) The parties intend this Agreement to control, to the extent stated
or fairly implied, the business and affairs of the Company, including the
Company's governance structure and the Company's dissolution, winding up, and
termination, as well as the relations among the Company's Members and persons
who have signed Contribution Agreements and Contribution Allowance Agreements.
SECTION 3.03 INVALIDITY AND UNREASONABLENESS OF EXPECTATIONS NOT INCLUDED
IN THIS AGREEMENT
(a) The Members fear the uncertainty and the potential for discord that
would exist if:
(1) the unstated expectation of one or more Members can
be used to gain advantage through litigation, or
(2) expectations stated or expressed outside the confines
of this Agreement can become actionable even though
not all Members agree with those expectations or have
assented to them and even though some Members have
expressed or may harbor conflicting expectations.
(b) The Members therefore agree that:
(1) it is unreasonable for any Member to have or rely on
an expectation that is not reflected in this
Agreement;
(2) any Member who has or develops an expectation
contrary to or in addition to the contents of this
Agreement has a duty to (A) immediately inform the
other Member, and (B) promptly seek to have this
Agreement amended to reflect the expectation;
(3) the failure of a Member who has or develops an
expectation contrary to or in addition to the
contents of this Agreement to obtain an amendment of
this Agreement as provided in Section 3.03(b)(ii) is
evidence that the expectation was not reasonable and
estops that Member from asserting that expectation as
a basis for any claim against the Company or any
other Member;
(4) no Member has a duty to agree to an amendment
proposed under Section 3.03(b)(ii) if the Member in
good faith (A) holds an inconsistent expectation, or
(B) believes that the amendment is not in the best
interests of the Company or is contrary to the
legitimate self-interests of the Member.
SECTION 3.04 ADVICE OF COUNSEL
Each person signing this Agreement:
5
(a) understands that this Agreement contains legally binding
provisions,
(b) has had the opportunity to consult with a lawyer, and
(c) has either consulted a lawyer or consciously decided not to consult
a lawyer.
ARTICLE IV. RELATIONSHIP OF THIS AGREEMENT
TO THE DEFAULT RULES PROVIDED BY THE LLC ACT
AND TO THE ARTICLES OF ORGANIZATION
SECTION 4.01 RELATIONSHIP OF THIS AGREEMENT TO THE DEFAULT RULES PROVIDED
BY THE LLC ACT
Regardless of whether this Agreement specifically refers to particular
default rules:
(a) if any provision of this Agreement conflicts with a default rule,
the provision of this Agreement controls and the default rule is modified or
negated accordingly, and
(b) if it is necessary to construe a default rule as modified or
negated in order to effectuate any provision of this Agreement, the default rule
is modified or negated accordingly.
SECTION 4.02 RELATIONSHIP BETWEEN THIS AGREEMENT AND THE ARTICLES OF
ORGANIZATION
If a provision of this Agreement differs from a provision of the Company's
articles of organization, then to the extent allowed by law this operating
agreement will govern.
ARTICLE V. CAPITAL STRUCTURE:
MEMBERSHIP AND CONTRIBUTIONS
SECTION 5.01 MEMBERSHIP UNITS
(a) Ownership rights in the Company are reflected in Membership Units,
as recorded in the Required Records. Each Membership Unit:
(i) has equal governance rights with every other
Membership Unit and in matters subject to a vote of
the Members has one vote; and
(ii) subject to Sections 6.08(c) and 6.05(a), each
Membership Unit has equal rights with every other
Membership Unit with respect to sharing of profits
and losses and with respect to distributions.
(b) A Member may assign the Member's financial rights only as provided
in and subject to Section 12.01. A Member may assign governance rights only as
provided in Section 12.02.
6
Assignment of a Member's entire interest, or any Membership Unit, involves the
assignment of both financial rights and governance rights and may be
accomplished only by complying with both Section 12.01 and Section 12.02.
(c) The Company will not issue any certificates of Membership Units,
but will at the written request of a Member provide certified statements of
Membership interests, stating the number of Membership Units owned, as well as
any effective assignments of rights under those Units, as of the date the
statement is provided.
SECTION 5.02 ISSUANCE OF MEMBERSHIP UNITS BY THE COMPANY
(a) The Members will determine when and for what consideration the
Company will issue Membership Units. For each Member, the Required Records state
the value and nature of the contribution received by the Company and the number
of Membership Units received in return by the Member.
(b) No Member has the right to make additional contributions or obtain
additional Units, and each Member specifically waives any preemptive rights.
SECTION 5.03 NO RIGHT OF COMPANY TO REQUIRE ADDITIONAL CONTRIBUTIONS
Except as provided in a Contribution Agreement, the Company has no right to
require any Member to make additional contributions. This section does not
release any Member from any obligation or promise of future performance that the
Company accepted as a contribution.
SECTION 5.04 COMPANY'S RIGHT TO ACCEPT ADDITIONAL CONTRIBUTIONS LIMITED
(a) The Company may not accept additional contributions, make
Contribution Agreements or Contribution Allowance agreements, or create or
allocate additional Membership Units except as approved by an act of the
Members.
(b) To be effective, the approval required by this section must specify
the number of Units authorized. The approval may, but need not, specify the
amount, nature, and value of the consideration to be received, the identity of
the contributor or would-be contributor, a deadline by which the authorized
contribution must be received, or any other condition on the approval.
(c) Approval under this section is not effective to authorize the
creation of a separate class or series of Membership Units.
SECTION 5.05 NO RIGHTS OF REDEMPTION OR RETURN OF CONTRIBUTION
Subject to Section 12.03, no Member has a right to have its Membership Units
redeemed or its contribution returned prior to the termination of the Company,
even if the Member dissociates prior to termination of the Company. Even at
termination, the right to return of contribution or redemption
7
is subject to Article XV.
ARTICLE VI. CAPITAL STRUCTURE: PROFITS, LOSSES, DISTRIBUTIONS,
AND TRANSACTIONS BETWEEN MEMBERS AND THE COMPANY
SECTION 6.01 ALLOCATION OF PROFITS AND LOSSES
(a) Except as stated in Section 6.08(c), profits and losses are
allocated each fiscal year according to the number of Membership Units owned, as
reflected in the Required Records.
(b) For any Membership Unit not owned by the same person for the entire
fiscal year, the allocation will be prorated.
(c) The Company will recognize any assignment of a Member's right to
share in profits or losses only to the extent the assignment complied with
Section 12.01.
SECTION 6.02 NO RIGHT TO INTERIM DISTRIBUTIONS
(a) Subject to Section 6.02(b), no Member has a right to any
distribution prior to the termination of the Company.
(b) From time to time, the Members shall determine in their reasonable
judgment to what extent, if any, the Company's cash on hand exceeds the current
and anticipated needs, including, without limitation, needs for operating
expenses, debt service, acquisitions and reserves. To the extent such excess
exists, the Members may make distributions to the Members in accordance with
Section 6.03.
SECTION 6.03 ALLOCATION OF INTERIM DISTRIBUTIONS
(a) Except as stated in Section 6.08(c), interim distributions, if
made, will be allocated according to the number of Membership Units owned, as
reflected in the Required Records.
(b) For any Membership Unit not owned by the same person for the entire
fiscal year, the allocation will be prorated.
(c) The Company will recognize any assignment of a Member's right to
receive distributions only to the extent the assignment complied with Section
12.01.
SECTION 6.04 NO RIGHT TO DISTRIBUTION UPON DISSOCIATION
A Member's dissociation does not entitle the Member to any distribution,
regardless of whether the dissociation causes the Company to dissolve.
8
SECTION 6.05 DISTRIBUTIONS UPON TERMINATION OF THE COMPANY
(a) At the Termination of the Company, subject to Article XV and after
the Company has satisfied or provided for the satisfaction of all the Company's
debts and other obligations, the Company's assets will be distributed in cash to
the Members and any dissociated Members whose interests have not been previously
redeemed as provided in Sections 13.03 and 15.03 as follows:
(1) first, in discharge of their respective Capital
Interests; and
(2) then, in proportion to their Membership Units.
(b) If the Company lacks sufficient assets to make the distributions
described in Section 6.05(a), the Company will make distributions in proportion
to the amount in the respective Capital Interests of the Members and dissociated
Members whose interests have not been previously redeemed.
SECTION 6.06 DISTRIBUTIONS IN KIND
(a) No Member has a right to any distribution in any form other than
money.
(b) The Company may not make a distribution in kind unless
(i) the Member receiving the in-kind distribution
consents,
(ii) all Members receive undivided interests in the same
property, or
(iii) all Members receive, in proportion to their rights to
distribution, interests in substantially equivalent
property.
SECTION 6.07 DISTRIBUTIONS SUBJECT TO SET-OFF BY THE COMPANY
All distributions are subject to set-off by the Company
(a) in the case of a Member, for any past-due obligation of the Member
to make a contribution to the Company; and
(b) in the case of an assignee of financial rights, for any past-due
obligation owed to the Company by the Member who originally owned the financial
rights.
SECTION 6.08 LOANS FROM AND OTHER TRANSACTIONS WITH MEMBERS
(a) With the approval of all the other Members, the Company may borrow
money from and enter into other transactions with a Member.
9
(b) The Company may enter into transactions and other undertakings
(including borrowing money) with a Member, with the written approval of all the
Members, whether or not they would ordinarily have voting power. To be valid,
the approval must be based on all material information concerning both the
undertaking and the Interested Member's relationship to the undertaking. Valid
approval under this paragraph constitutes approval under Section 3058 of Title
11, Vermont Statutes Annotated.
(c) On account of loans made, or transactions performed, by a Member
under this section, remaining Members may increase, temporarily or permanently,
a Member's right to share in profits and distributions.
(d) Borrowing from or engaging in other transactions with one or more
Members does not obligate the Company to provide comparable opportunities to
other Members.
ARTICLE VII. TAX MATTERS
SECTION 7.01 TAX CHARACTERIZATION AND RETURNS
The initial Member hereto acknowledges that at all times that two or more
persons or entities hold equity interests in the Company for federal income tax
purposes (i) it is the intention of the Company to be treated as a "partnership"
for federal and all relevant state tax purposes and (ii) the Company will be
treated as a "partnership" for federal and all relevant state tax purposes and
shall make all available elections to be so treated. Until such time, however,
it is the intention of the Member that the Company be disregarded for federal
and all relevant state tax purposes and that the activities of the Company be
deemed to be activities of the Member for such purposes. All provisions of the
Company's Articles of Organization and this Agreement are to be construed so as
to preserve that tax status under those circumstances. In the event that the
Company is treated as a partnership for tax purposes in accordance with this
Section 7.01, then within ninety (90) days after the end of each fiscal year,
the Company will cause to be delivered to each person who was a Member at any
time during such fiscal year a Form K-1 and such other information, if any, with
respect to the Company as may be necessary for the preparation of each Member's
federal, state or local income tax (or information) returns, including a
statement showing each Member's share of income, gain or loss, and credits for
the fiscal year.
SECTION 7.02 CAPITAL ACCOUNTS
The Company will establish a Capital Account for each Member and will maintain
each Account according to the following rules:
(a) Maintenance. The Company will maintain the Capital Accounts in
accordance with Treasury Regulations ss. 1.704-1(b)(2)(iv).
(b) Liquidation Payments. If the Company liquidates itself or a
Member's Membership interest, subject to Article XV, the Company will make
liquidating distributions in accordance with
10
Section 6.05.
(c) Negative Capital Account and Qualified Income Offset. A Member is
not be liable to fund any deficit in the Member's Capital Account at any time.
Notwithstanding any other provision in this Agreement, if a Member unexpectedly
receives an adjustment, allocation, or distribution described in Treasury
Regulations Section 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or
1.704-1(b)(2)(ii)(d)(6), and the unexpected adjustment, allocation, or
distribution results in a deficit balance in the Capital Account for the Member,
the Member will be allocated items of income and gain in an amount and manner
sufficient to eliminate the deficit balance or the increase in the deficit
balance as quickly as possible. It is intended that this subdivision will meet
the requirements of a "qualified income offset" as defined in Treasury
Regulations Section 1.704-1(b)(2)(ii)(d), and this subdivision is to be
interpreted and applied consistent with that intention.
(d) Nonrecourse Deductions. If a Member's Capital Account has a deficit
balance at any time and the deficit or increase in deficit was caused by the
allocation of nonrecourse deductions as defined in Treasury Regulations Section
1.704-2(b), then beginning in the first taxable year of the Company in which
there are nonrecourse deductions or in which the Company makes a distribution of
proceeds of a nonrecourse liability that are allocable to an increase in minimum
gain as defined in Treasury Regulations Section 1.704-2(d) and thereafter
throughout the full term of the Company, the following rules shall apply:
(i) Nonrecourse deductions shall be allocated to the
Members in a manner that is reasonably consistent
with the allocations that have substantial economic
effect as defined in Treasury Regulations Section
1.704-1 or some other significant item attributable
to the property securing the nonrecourse liabilities,
if applicable; and
(ii) If there is a net decrease in minimum gain for a
taxable year, each Member will be allocated items of
Company income and gain for that year equal to that
Member's share of the net decrease in minimum gain as
defined in Treasury Regulations Section
1.704-2(g)(2).
SECTION 7.03 ACCOUNTING DECISIONS
(a) All of the Members will make all decisions as to accounting
matters, and
(b) All of the Members may cause the Company to make whatever elections
the Company may make under the Code, including the election referred to in
Section 754 of the Code to adjust the basis of Company assets.
SECTION 7.04 "TAX MATTERS PARTNER"
The Members will designate a Member to act on behalf of the Company as the "tax
matters partner" within the meaning of Section 6231(a)(7) of the Code.
11
ARTICLE VIII. GOVERNANCE:
MANAGEMENT BY MEMBERS
SECTION 8.01 MANAGEMENT BY MEMBERS
The Company will be managed by its Members.
SECTION 8.02 OPERATIONAL AUTHORITY OF MEMBERS
(a) Subject to Article IX and except as provided in Section 8.02(b),
the Members, acting as a group, have sole authority to manage the Company and
are authorized to make any contracts, enter into any transactions, and make and
obtain any commitments on behalf of the Company to conduct or further the
Company's business.
(b) The Members may delegate to a subcommittee of Members, an
individual Member, or an employee of the Company any management responsibility
or authority except those matters described in Article IX.
SECTION 8.03 MANAGERIAL DUTIES OF MEMBERS
(a) Each Member must discharge his, her, or its managerial duties in
good faith, with the care an ordinarily prudent person in a like position would
exercise under similar circumstances, and in a manner the Member reasonably
believes to be in the best interests of the Company.
(b) A Member may rely on information received from other persons if
that reliance is consistent with the Member's duties under Section 8.04(a).
SECTION 8.04 NONLIABILITY OF MEMBERS FOR ACTS OR OMISSIONS IN THEIR
MANAGERIAL CAPACITY
To the full extent permitted by Section 3059 of Title 11, Vermont Statutes
Annotated, all Members are released from liability for damages and other
monetary relief on account of any act, omission, or conduct in the Member's
Managerial capacity. This release does protect a Member from being required by a
court to purchase the Membership interest of another Member who successfully
contends that the Member has committed actionable oppressive acts to the
prejudice of the other Member. No amendment or repeal of this section affects
any liability or alleged liability of any Member for acts, omissions, or conduct
that occurred prior to the amendment or repeal.
SECTION 8.05 NO AUTHORITY OF INDIVIDUAL MEMBERS
Except as authorized under paragraph 8.02(b), no individual Member is an agent
of the Company or has the authority to make any contracts, enter into any
transactions or make any commitments on behalf of the Company.
12
ARTICLE IX. LIMITATIONS ON MANAGERIAL POWERS
SECTION 9.01 APPOINTMENT OF MANAGERS.
The Members shall appoint a Chief Manager (which office may be designated
"President" or "Chief Executive Officer" or such other designation as the
Members may determine from time to time, but which officer shall in any event
perform the functions of the "Chief Manager," and any references in this
Agreement to the "Chief Manager" shall be deemed to be references to such
officer) and a Secretary to serve as the Managers of the Company. The initial
Chief Manager shall be Gregory L. Burns. The initial Secretary shall be William
A. Gillespie. The Company shall have such additional Managers as may be
appointed from time to time by the Members. Notwithstanding anything herein to
the contrary, no Manager may take any action or execute any contract or document
on behalf of the Company unless authorized to do so by the Members.
SECTION 9.02 TERM; REMOVAL.
The Managers shall serve for an indefinite term at the pleasure of the Members.
A Manager may be removed from office at any time with or without cause by the
Members.
SECTION 9.03 MANAGER DUTIES.
(a) Chief Manager. The Chief Manager shall see that all orders and
resolutions of the Members are carried into effect and shall perform such other
duties as the Members may from time to time prescribe.
(b) Secretary. The Secretary shall attend all meetings of the Members
and shall be responsible for recording the minutes thereof. The Secretary shall
have the responsibility of authenticating records of the Company and receiving
notices required to be sent to the Secretary and shall perform such other duties
as the Members may from time to time prescribe.
SECTION 9.04 MANAGER RESIGNATION.
Any Manager of the Company may resign at any time by giving written notice to
the Members. The resignation of any Manager shall take effect upon receipt of
notice thereof or at such later time as shall be specified in such notice; and
unless otherwise specified therein, the acceptance of such resignation shall not
be necessary to make it effective.
SECTION 9.05 COMPENSATION AND REIMBURSEMENT.
No Manager shall have any right to compensation for services performed on behalf
of the Company except as determined from time to time by the Members.
Notwithstanding the foregoing, a Manager shall have the right to be reimbursed
by the Company for any out-of-pocket expenses incurred by
13
such Manager in connection with any services performed by such Manager on behalf
of the Company.
SECTION 9.06 NO EXCLUSIVE DUTY.
Each Manager may have other business interests and may engage in other
activities in addition to those relating to the Company. Neither the Company nor
any Member shall have the right to share or participate in such other
investments or activities of such Manager based on such Manager's status as a
Manager of the Company. No Manager shall incur any liability to any Member or
the Company as a result of engaging in any other business or venture.
SECTION 9.07 ACTIONS REQUIRING UNANIMOUS OR SUPERMAJORITY CONSENT
(a) The Members have no authority or power to take the following
actions unless first approved by an act of the Members giving unanimous
approval:
(i) the making of any Contribution Agreements or
Contribution Allowance Agreements;
(ii) the issuance of any additional Membership Units;
SECTION 9.08 OTHER PROVISIONS LIMITING MANAGERIAL AUTHORITY
When some other provision of this Agreement states procedures for taking
particular actions or accomplishing specified results, that provision states the
sole method for taking that action or accomplishing that result.
ARTICLE X
ACTS OF MEMBERS AND MEMBER MEETINGS
SECTION 10.01 ACTS OF MEMBERS
Except to the extent that Chapter 21 of Title 11, Vermont Statutes Annotated,
the articles of organization, or this operating agreement require otherwise, an
act of the Members consists of either:
(a) a majority vote of the Membership Units present at a properly
called meeting of the Members, when a quorum is present, or
(b) written action without a meeting, as provided in Section 10.09.
SECTION 10.02 REQUIRED ANNUAL MEETING
14
The Members will meet at least annually. Notice of this annual meeting shall
comply with Section 10.04.
SECTION 10.03 SPECIAL MEETINGS
(a) A special meeting of the Members may be called for any purpose or
purposes at any time by one or more Members owning at least ten percent (10%) of
the Membership Units of the Company entitled to vote.
(b) For any special meeting those persons who are demanding the special
meeting must give written notice to the Chief Manager or the Secretary of the
Company specifying the purposes of the meeting. Within thirty (30) days after
either Officer receives a demand under this paragraph, that Officer must call a
special meeting of the Members. If the Officer fails to call the special meeting
as required by this paragraph, the person or persons making the demand may, at
the expense of the Company, call the meeting by giving the notice described in
Section 10.04.
SECTION 10.04 NOTICE OF MEETINGS
Written notice of each meeting of the Members, stating the date, time, and place
and, in the case of a special meeting, the purpose or purposes, must be given to
every Member at least ten (10) days and not more than sixty (60) days prior to
the meeting. The business transacted at a special meeting of Members is limited
to the purposes stated in the notice of the meeting.
SECTION 10.05 LOCATION AND CONDUCT OF THE MEETINGS; ADJOURNMENTS
(a) Each meeting of the Members will be held at the Company's principal
place of business or at some other suitable location within the same county, as
designated by the Chief Manager.
(b) The Chief Manager will chair each meeting of the Members.
(c) Any meeting of the Members may be adjourned from time to time to
another date and time and, subject to Section 10.05(a), to another place. If at
the time of adjournment the person chairing the meeting announces the date,
time, and place at which the meeting will be reconvened, it is not necessary to
give any further notice of the reconvening.
SECTION 10.06 WAIVER OF NOTICE
(a) A Member may waive notice of the date, time, place, and purpose or
purposes of a meeting of Members. A waiver may be made before, at, or after the
meeting, in writing, orally, or by attendance.
(b) Attendance by a Member at a meeting is a waiver of notice of that
meeting, unless the Member objects at the beginning of the meeting to the
transaction of business because the meeting is not properly called or convened,
or objects before a vote on an item of business because the item
15
may not properly be considered at that meeting and does not participate in the
consideration of the item at that meeting.
SECTION 10.07 PROXIES
(a) A Member may cast or authorize the casting of a vote by filing a
written appointment of a revocable proxy with the Chief Manager or the Secretary
of the Company at or before the meeting at which the appointment is to be
effective. The Member may sign or authorize the written appointment by telegram,
cablegram, or other means of electronic transmission stating, or submitted with
information sufficient to determine, that the Member authorized the
transmission. Any copy, facsimile, telecommunication, or other reproduction of
the original of either the writing or the transmission may be used in lieu of
the original, if it is a complete and legible reproduction of the entire
original.
(b) A member may not grant or appoint an irrevocable proxy.
SECTION 10.08 QUORUM
For any meeting of the Members, a quorum consists of a majority of the
Membership Units. If a quorum is present when a properly called meeting is
convened, the Members present may continue to transact business until
adjournment, even though the departure of Members originally present leaves less
than the proportion otherwise required for a quorum.
SECTION 10.09 ACTION WITHOUT A MEETING
Any action required or permitted to be taken at a meeting of the Members may be
taken without a meeting by written action signed by the Members who own the
number of Membership Units equal to the number of Units that would be required
to take the same action at a meeting of the Members at which all Members were
present. The written action is effective when signed by Members owning the
required number of Units, unless a different effective time is provided in the
written action. When written action is taken by less than all Members, the
Company will immediately notify all Members of the action's text and effective
date. Failure to provide the notice does not invalidate the written action.
ARTICLE XI
REQUIRED RECORDS
SECTION 11.01 CONTENTS AND LOCATION OF REQUIRED RECORDS
The Company will maintain the Required Records at its principal place of
business, or at some other location chosen by the Chief Manager.
SECTION 11.02 ACCESS TO REQUIRED RECORDS
16
(a) After giving reasonable advance notice to the Company, any Member
may inspect and review the Required Records and may, at the Member's expense,
have the Company make copies of any portion or all of the Records.
(b) Unless the Company agrees otherwise, all Member access to the
Required Records must take place during the Company's regular business hours.
The Company may impose additional reasonable conditions and restrictions on
Members' access to the Required Records, including specifying the amount of
advance notice a Member must give and the charges imposed for copying.
ARTICLE XII
TRANSFER RESTRICTIONS
SECTION 12.01 FINANCIAL RIGHTS
(a) A Member may assign its Financial Rights in whole or in part. As to
the Company, an assignment of Financial Rights is effective only when the
Company has received notice of the assignment and has noted the assignment in
the Required Records.
(b) An assignee of a Member's Financial Rights derives its rights
exclusively through the Member/assignor. Any assignee takes the assignment
subject to any claims or offsets the Company has against the Member, regardless
of whether those claims or offsets exist at the time of the assignment or arise
afterwards. An amendment to this Agreement may change a Member's rights and
consequently affect the rights of an assignee, even if the amendment is made
after the assignment.
SECTION 12.02 COMPLETE MEMBERSHIP INTERESTS AND GOVERNANCE RIGHTS
(a) A member must have Majority-In-Interest Consent before assigning a
complete Membership Unit or any Governance Rights
(i) to a Member, if the assignment will leave the
assignor/Member with no Governance Rights;
(ii) to a person not already a Member, regardless of
whether the assignment will leave the assignor/Member
with no Governance Rights.
(b) If an assignment covered by Section 12.02(a)(ii) receives the
required Majority-In-Interest Consent and takes effect,
(i) the assignment will cause the assignor/Member to
become a Dissociated Member, and
(ii) the Majority-In-Interest Consent obtained to satisfy
Section 12.02(a)(ii) will
17
also satisfy the requirement for Majority-In-Interest
Consent established by Section 14.01 and triggered by
the assignor/Member's dissociation from the Company.
(c) An assignment made in violation of Section 12.02(a) is void.
Section 12.02(a) does not limit the right or power of a Member to grant a
revocable proxy under Section 10.07.
SECTION 12.03 RIGHT TO PUT COMPLETE MEMBERSHIP INTEREST WHEN TRANSFER
CONSENT IS UNREASONABLY WITHHELD
(a) A would-be assignor may require the Company to redeem the
Membership Units at the price and on the terms of the offer to purchase
submitted under Section 12.03(a)(iv) if:
(i) a Member proposes to assign all its Membership
Units;
(ii) the proposed assignee meets the suitability
requirements stated in Section 12.03(b);
(iii) the proposed assignee has made a bona fide, written,
enforceable offer to purchase; and
(iv) within ten (10) days of receiving written notice of
the proposed assignment, including a copy of the
offer referred to in clause (iii) above,
(1) neither the Company nor the other Members
give notice that they are exercising the
rights stated in Section 12.02(a), and
(B) the assignment does not receive the
Majority-In-Interest Consent required by
Section 12.02(a).
To require the redemption, the would-be transferor must make a written demand on
the Company within ten (10) days after the expiration of the deadline for
approval stated in Section 12.03(a)(iv).
(b) To be suitable to trigger the "put" rights stated in Section
12.03(a), the offer to purchase must:
(1) involve a purchaser who is a lineal descendant of the
initial Members;
(2) involve a purchaser who can establish
creditworthiness in the event any liability accrues
for unlawful distributions;
(3) involve a purchaser with experience in the Company's
business; and
(4) involve a purchaser who is not a competitor with the
Company or any of the
18
parties to which it provides management services.
ARTICLE XIII
MEMBER DISSOCIATION: EFFECT ON DISSOCIATED MEMBER
SECTION 13.01 IF DISSOLUTION RESULTS
If the dissociation of a Member results in the dissolution of the Company, the
Dissociated Member will have any rights of a Member who has not dissociated,
subject to Section 13.03.
SECTION 13.02 IF DISSOLUTION IS AVOIDED
If the dissociation does not result from an expulsion under Section 13.03 and
does not result in the dissolution of the Company:
(a) The Dissociated Member loses, without compensation, all Governance
Rights but will retain the Financial Rights owned before the dissociation;
(b) Subject to Section 13.04, the Dissociated Member will be considered
to have, as if no dissociation had occurred,
(i) the same right to share in profits and losses under
Section 6.01,
(ii) the same right to distributions under Sections 6.03
and 6.05,
(iii) the same Capital Interest; and
(c) Neither the Company nor the remaining Members are obligated to
purchase the interest of or to make any payment to the Dissociated Member.
SECTION 13.03 EXPULSION OF A MEMBER
(a) Without having to state, possess, or prove cause, the Company may
expel any Member by an act of the Members reflecting the agreement of Members
holding eighty percent (80%) of the Membership Units, excluding from the
calculation Units owned by the Member sought to be expelled.
(b) When a Member is expelled under Section 13.03(a):
(i) if dissolution results, Section 13.01 governs;
(ii) if dissolution does not result,
19
(A) all the Member's Financial Rights and
Governance Rights are canceled and
(B) as full compensation, the Member will
receive its Capital Interest, subject to
Section 13.04.
If the expelled Member's Capital Interest constitutes more than twenty percent
(20%) of the total of all Capital Interests, the Company may at its option pay
the expelled Member in twelve (12) equal monthly installments, together with
interest at the then applicable federal rate.
SECTION 13.04 DAMAGES AND SET-OFFS
(a) No Member has the right to dissociate before the end of the
duration of the Company as stated in the articles of organization. If a Member
dissociates before that time and the dissociation results from volitional
conduct of the Member that could reasonably be characterized as resignation,
retirement, or withdrawal, then the Dissociated Member is liable to the Company
for damages resulting from the wrongful dissociation.
(b) The Company may set off any amounts or obligations owed by a
Dissociated Member to the Company against any amounts due the dissociated
Member, regardless of the cause of a Member's dissociation and regardless of
whether the Member's Dissociation results in dissolution of the Company.
ARTICLE XIV
MEMBER DISSOCIATION: EFFECT ON THE COMPANY
SECTION 14.01 DISSOLUTION AVOIDANCE
A Member's dissociation will not cause the Company to dissolve if
(a) more than one Member remains, or, if only one Member remains,
within sixty (60) days after the dissociation the sole remaining Member elects
to continue the Company as a single Member Company; or
(b) within sixty (60) days after the dissociation Majority-In-Interest
Consent is obtained to avoid dissolution and to continue the existence and
business of the Company.
SECTION 14.02 AGREEMENT TO GIVE DISSOLUTION AVOIDANCE CONSENT
(a) Subject to Section 14.02(b), within sixty (60) days after the
Dissociation of a Member each remaining Member will consent to avoid dissolution
and continue the existence and business of the Company. Each Member will give
the consent in a form satisfactory to the Chief Executive Officer.
20
(b) The consent required by this section may be given through the
holder of a revocable proxy authorized in Section 10.07. By this Agreement, each
Member appoints the Chief Executive Officer as the holder of the Member's proxy
for this purpose.
ARTICLE XV
BUSINESS CONTINUATION IN THE EVENT OF DISSOLUTION
SECTION 15.01 TRIGGERING EVENTS
(a) Subject only to Section 15.01(b), if the Company dissolves for any
reason at any time, the affairs of the Company will be wound up and its legal
existence terminated by merging the Company into a Successor LLC, as provided in
Section 15.02.
(b) Section 15.02 will not apply and the Company will be liquidated
under Section 3101 of Title 11, Vermont Statutes Annotated, if
(i) within sixty (60) days after the dissolution Members
owning more than fifty percent (50%) of all
Membership Units notify the Company in writing that
they object to proceeding under Section 15.02,
(ii) only one Member remains and such Member does not
elect to continue the Company as a single Member
Company, or
(iii) more than twenty (20) years have passed since the
initial date of this Agreement.
SECTION 15.02 BUSINESS CONTINUITY
(a) Subject only to Section 15.01(b), as soon as dissolution occurs the
remaining Members will:
(i) organize the Successor LLC,
(ii) develop a plan of merger that complies with Section
15.02(c) for the Company and the Successor LLC,
(iii) approve the plan of merger on behalf of the Company
and submit the plan to the Company's Members for
approval at a properly called meeting of the Members,
(iv) cause the Managers, if any, of the Successor LLC to
approve the plan of merger and submit the plan to the
Members of the Successor LLC for
21
approval, and
(v) cause the Members of the Successor LLC to approve the
plan of merger.
(b) When the plan of merger is presented to the Members for approval,
the Members will, subject to Section 15.03,
(i) vote to approve the plan, and
(ii) sign any documents that the plan requires them to
sign or whose execution is necessary to proper
implementation of the plan.
(c) The plan of merger must provide that
(i) the Successor LLC will be the surviving organization
in the merger,
(ii) all the assets and liabilities of the Company will be
transferred to the Successor LLC and the Successor
LLC will continue the business of the Company under
the same name,
(iii) all Membership Units of the Members, including all
Financial Rights (whether or not assigned) and all
Governance Rights, will be converted into Membership
Units in the Successor LLC having substantially
identical terms,
(iv) the Successor LLC will have articles of organization
and an operating agreement that are substantially
equivalent to the articles of organization and
operating agreement in effect for the Company
immediately prior to the merger, and
(v) the rights of any dissociated Members as described in
Article XIII will apply against the Successor LLC.
SECTION 15.03 DISSENTERS' RIGHTS
(a) Any person who is a Member at the time of dissolution can dissent
from the implementation of the business continuation agreement stated in this
section by giving written notice to the Company within five (5) days after the
Members present the plan for a vote and by voting against the proposed merger.
(b) A Member who properly dissents under Section 15.03(a) will be
cashed out of the dissolved Company as if the Company had expelled the Member
under Section 13.03, except that if the Company properly chooses to make
installment payments, the obligation to make those payments will transfer to the
Successor LLC as part of the merger contemplated by this article.
22
ARTICLE XVI
INDEMNIFICATION
SECTION 16.01 DEFINITIONS
For purposes of this article, the terms defined in this section have the
meanings given them.
(a) "Company" includes any domestic or foreign company that was the
predecessor of this Company in a merger or other transaction in which the
predecessor's existence ceased upon consummation of the transaction.
(b) "Official capacity" means (i) with respect to a Member, the
position of Member in the Company, (ii) with respect to a person other than a
Member, the elective or appointive office or position held by an officer, member
of a committee, if any, or the efforts undertaken by a Member of the Company who
acts on behalf of and at the request of the Company, or the employment or agency
relationship undertaken by an employee or agent of the Company, and (iii) with
respect to a member officer, employee, or agent of the Company who, while an
officer, employee, or agent of the Company, is or was serving at the request of
the Company or whose duties in that position involve or involved service as an
officer, partner, trustee, or agent of another organization or employee benefit
plan, the position of that person as an officer, partner, trustee, employee, or
agent, as the case may be, of the other organization or employee benefit plan.
(c) "Proceeding" means a threatened, pending, or completed civil,
criminal, administrative, arbitration, or investigative proceeding, including a
proceeding by or in the right of the Company.
(d) "Special legal counsel" means counsel who has not represented the
Company or a related company, or an officer, member, employee, or agent whose
indemnification is in issue.
SECTION 16.02 MANDATORY INDEMNIFICATION; STANDARD
(a) The Company will indemnify a person made or threatened to be made a
party to a proceeding by reason of the former or present official capacity of
the person against judgments, penalties, fines, including, without limitation,
excise taxes assessed against the person with respect to an employee benefit
plan, settlements, and reasonable expenses, including attorney fees and
disbursements, incurred by the person in connection with the proceeding, if,
with respect to the acts or omissions of the person complained of in the
proceeding, the person
(i) has not been indemnified by another organization or
employee benefit plan for the same judgments,
penalties, fines, including, without limitation,
excise taxes assessed against the person with respect
to an employee benefit plan, settlements, and
reasonable expenses, including attorney fees and
disbursements, incurred by the person in connection
with the proceeding with respect to the same acts or
omissions;
23
(ii) acted in good faith;
(iii) received no improper personal benefit; and
(iv) in the case of a criminal proceeding, had no
reasonable cause to believe the conduct was unlawful;
and
(v) in the case of acts or omissions occurring in the
official capacity described in Section 16.01(c)(i) or
Section 16.01(c)(ii), reasonably believed that the
conduct was in the best interests of the Company, or
in the case of acts or omissions occurring in the
official capacity described in Section 16.01(c)(iii),
reasonably believed that the conduct was not opposed
to the best interests of the Company. If the person's
acts or omissions complained of in the proceeding
relate to conduct as a manager, officer, trustee,
employee, or agent of an employee benefit plan, the
conduct is not considered to be opposed to the best
interests of the Company if the person reasonably
believed that the conduct was in the best interests
of the participants or beneficiaries of the employee
benefit plan.
(b) The termination of a proceeding by judgment, order, settlement, or
conviction or upon a plea of nolo contendere or its equivalent does not, of
itself, establish that the person did not meet the criteria set forth in this
Section 16.02.
SECTION 16.03 ADVANCES
If a person is made or threatened to be made a party to a proceeding, the person
is entitled, upon written request to the Company, to payment or reimbursement by
the Company of reasonable expenses, including attorney fees and disbursements,
incurred by the person in advance of the final disposition of the proceeding,
(a) upon receipt by the Company of a written affirmation by the person
of a good faith belief that the criteria for indemnification set forth in
Section 16.02 have been satisfied and a written undertaking by the person to
repay all amounts so paid or reimbursed by the Company, if it is ultimately
determined that the criteria for indemnification have not been satisfied, and
(b) after a determination that the facts then known to those making the
determination would not preclude indemnification under this article.
The written undertaking required by paragraph (a) above is an unlimited general
obligation of the person making it, but need not be secured and will be accepted
without reference to financial ability to make the repayment.
24
SECTION 16.04 REIMBURSEMENT TO WITNESS
Subject to the qualification under the standards described in Section 16.02, the
Company will reimburse expenses, including attorney fees and disbursements,
incurred by a person in connection with an appearance as a witness in a
proceeding at a time when the person has not been made or threatened to be made
a party to a proceeding.
SECTION 16.05 DETERMINATION OF ELIGIBILITY
(a) All determinations as to whether indemnification of a person is
required because the criteria stated in Section 16.02 have been satisfied and as
to whether a person is entitled to payment or reimbursement of expenses in
advance of the final disposition of a proceeding as provided in Section 16.03
will be made:
(i) by the Members, excluding the votes held by parties
to the proceedings; or
(ii) if an adverse determination is made under clause (i)
or under paragraph (b), or if no determination is
made under clause (i) or under paragraph (b) within
sixty (60) days after the termination of a proceeding
or after a request for an advance of expenses, as the
case may be, by a court in Vermont, which may be the
same court in which the proceeding involving the
person's liability is taking or has taken place, upon
application of the person and any notice the court
requires.
(b) With respect to a person who is not, and was not at the time of the
acts or omissions complained of in the proceedings, an officer, or person
possessing, directly or indirectly, the power to direct or cause the direction
of the management or policies of the Company, the determination whether
indemnification of this person is required because the criteria set forth in
Section 16.02 have been satisfied and whether this person is entitled to payment
or reimbursement of expenses in advance of the final disposition of a proceeding
as provided in Section 16.03 may be made by an annually appointed committee of
the Members.
SECTION 16.06 INSURANCE
The Company may purchase and maintain insurance on behalf of a person in that
person's official capacity against any liability asserted against and incurred
by the person in or arising from that capacity, whether or not the Company would
have been required to indemnify the person against the liability under the
provisions of this article.
SECTION 16.07 DISCLOSURE
The amount of any indemnification or advance paid pursuant to this article and
to whom and on whose behalf it was paid will be included in the Required
Records.
25
SECTION 16.08 DISCRETIONARY INDEMNIFICATION OF OTHERS
Nothing in this Article XVI limits the ability of the Members to cause the
Company to indemnify any person or entity not described in this Article XVI
pursuant to, and to the extent described in, an agreement authorized by an act
of the Members.
ARTICLE XVII
REMEDIES FOR BREACH
SECTION 17.01 SPECIFIC ENFORCEMENT
Except for the provisions of Section 14.02, all breaches of this Agreement are
subject to specific enforcement, without prejudice to the right to seek damages
or other remedies.
SECTION 17.02 CONCURRENT OR CONSECUTIVE CAUSATION OF DAMAGES
(a) If two or more Members breach this Agreement and those breaches
combine in any way, concurrently or consecutively, to produce harm to the
Company, then those Members are jointly and severally liable to the Company for
the entirety of the harm. This paragraph precludes a Member who has breached
this Agreement from asserting that another Member's prior, contemporaneous, or
subsequent breach constitutes a superseding, intervening, or independent cause
or in any way releases the breaching Member from liability.
(b) Section 17.02(a) does not preclude breaching Members from seeking
contribution or indemnity from each other, or otherwise seeking to allocate
among themselves the responsibility and liability for the harm caused to the
Company.
SECTION 17.03 ATTORNEY FEES AND OTHER LITIGATION EXPENSES
If the Company resorts to litigation to remedy a breach of this Agreement by a
Member or former Member and the Company prevails in the litigation, in addition
to any other remedies available to the Company under this Agreement or by law
the Company may collect its reasonable attorney fees and other costs and
expenses of litigation.
ARTICLE XVIII
AMENDMENTS
SECTION 18.01 REQUIREMENTS FOR AMENDMENTS
To be effective, any amendment to this Agreement must be approved by an act of
the Members reflecting approval by Members owning fifty-one percent (51%) of the
Membership Units.
26
ARTICLE XIX
MISCELLANEOUS
SECTION 19.01 GOVERNING LAW
This Agreement, and any question, dispute, or other matter related to or arising
from this Agreement, will be governed by the laws of the State of Vermont.
SECTION 19.02 BINDING EFFECT
This Agreement binds all Members and their respective distributees, successors,
and assigns and any other person claiming a right or benefit under or covered by
this Agreement.
SECTION 19.03 SEVERABILITY
If any provision of this Agreement is held to be illegal, invalid, or
unenforceable,
(a) that provision will be fully severable and this Agreement will be
construed and enforced as if the illegal, invalid, or unenforceable provision
had never been part of this Agreement;
(b) the remaining provisions of this Agreement will remain in full
force and will not be affected by the illegal, invalid, or unenforceable
provision or by its severance from this Agreement; and
(c) in the place of the illegal, invalid, or unenforceable provision,
there will be added automatically to this Agreement a legal, valid, and
enforceable provision that is as similar to the illegal, invalid, or
unenforceable provision as possible.
SECTION 19.04 MULTIPLE COUNTERPARTS
This Agreement may be executed in several counterparts, each of which will be
considered an original and all of which will constitute one and the same
document. Proving the execution and contents of this document against a party
may be done by producing any copy of this Agreement signed by that party.
SECTION 19.05 ADDITIONAL DOCUMENTS AND ACTS
Each Member agrees to execute and deliver whatever additional documents and to
perform such additional acts as may be necessary or appropriate to effectuate
and perform all of the terms, provisions, and conditions of this Agreement and
the transactions contemplated by this Agreement.
27
SECTION 19.06 NOTICES
(a) Any notice to be given or made to the Company, its Chief Manager,
its Secretary, or any Member must be in writing and will be considered to have
been given when delivered to the address specified in the Company's Required
Records.
(b) A person who wants to change its address as specified in the
Required Records may do so by giving written notice of the change to the Company
and to each Member. The change takes effect five days after the notice is given.
[The following page is the signature page.]
28
ACCEPTED AND AGREED TO BY:
99 Restaurants of Vermont, LLC ("the Company")
By: /s/ Gregory L. Burns
---------------------------------------------
Name: Gregory L. Burns
Title: Chief Manager and President
99 Restaurants, LLC (the "Member")
By: /s/ Gregory L. Burns
---------------------------------------------
Name: Gregory L. Burns
Title: Chief Manager and President
29
EXHIBIT "A"
99 RESTAURANTS OF VERMONT, LLC
Initial Parties
Name Membership Units
---- ----------------
99 RESTAURANTS, LLC 100
TOTAL UNITS 100
30
COUNTERPART TO OPERATING AGREEMENT OF
99 RESTAURANTS OF VERMONT, LLC
The undersigned Member of 99 Restaurants of Vermont, LLC (the
"Company"), in conjunction with its admission to the Company as a Member, hereby
agrees to become a party to, and hereby agrees to be bound by the terms and
conditions of, this Operating Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Counterpart as of
the 27th day of January, 2003.
99 WEST, INC.
By: /s/ Gregory L. Burns
---------------------------------
Name: Gregory L. Burns
Title: President
31
FIRST AMENDMENT TO
EXHIBIT A
TO
OPERATING AGREEMENT
OF
99 RESTAURANTS OF VERMONT, LLC
MEMBERS
Name Membership Units
---- ----------------
99 WEST, INC. 100
TOTAL UNITS 100
Attest: The above information is
true, complete and correct as of
the 27th day of January, 2003.
/s/ William A. Gillespie
------------------------
William A. Gillespie, Secretary
32