SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
Under the Securities Exchange Act of 1934
SECURED INCOME L.P.
(Name of Issuer)
UNITS OF LIMITED PARTNERSHIP INTEREST
(Title of Class of Securities)
813901105
(CUSIP Number)
GINA S. SCOTTI
SECRETARY
WEST PUTNAM HOUSING INVESTORS II LLC
599 WEST PUTNAM AVENUE
GREENWICH, CONNECTICUT 06830
(203) 869-0900
(Name, Address and Telephone Number of
Person Authorized to Receive Notices
and Communications)
with a copy to:
ABBE L. DIENSTAG, ESQ.
KRAMER, LEVIN, NAFTALIS & FRANKEL LLP
919 THIRD AVENUE, NEW YORK, NY 10022
(212) 715-9100
August 21, 2000
(Date of Event which Requires Filing
of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(e), 13d-1(f), or 13d-1(g) check the following
box: ?
Page 1 of 8 Pages
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13D Page 2 of 8 Pages
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1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
WEST PUTNAM HOUSING INVESTORS II, LLC
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)[X]
(b)|_|
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3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e)
|_|
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 186,217 Units (See Item 5)
OWNED BY
EACH
REPORTING
PERSON
WITH
--------------------------------------------------------------------------------
8 SHARED VOTING POWER
None
--------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
186,217 Units (See Item 5)
--------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
None
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
186,217 Units (See Item 5)
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
18.9%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
OO
--------------------------------------------------------------------------------
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13D Page 3 of 8 Pages
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1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
WEST PUTNAM HOUSING INVESTORS LLC
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)[X]
(b)|_|
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
WC, AF
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e)
|_|
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY 40,961 Units (See Item 5)
OWNED BY
EACH
REPORTING
PERSON
WITH
--------------------------------------------------------------------------------
8 SHARED VOTING POWER
186,217 Units (See Item 5)
--------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
40,961 Units (See Item 5)
--------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
186,217 Units (See Item 5)
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
227,178 Units (See Item 5)
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
23.1%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
OO
--------------------------------------------------------------------------------
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13D Page 4 of 8 Pages
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1 NAMES OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
RICHARD P. RICHMAN
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a)[X]
(b)|_|
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS
AF
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEM 2(d) or 2(e)
|_|
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
--------------------------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES
BENEFICIALLY None
OWNED BY
EACH
REPORTING
PERSON
WITH
--------------------------------------------------------------------------------
8 SHARED VOTING POWER
227,178 Units (See Item 5)
--------------------------------------------------------------------------------
9 SOLE DISPOSITIVE POWER
None
--------------------------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
227,178 Units (See Item 5)
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
227,178 Units (See Item 5)
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW 11 EXCLUDES CERTAIN SHARES
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
23.1%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
IN
--------------------------------------------------------------------------------
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<PAGE>
Schedule 13D
Item 1. Security and Issuer
This Statement on Schedule 13D (this "Statement") relates to the units of
limited partnership interest ("Units") of Secured Income L.P., a Delaware
limited partnership (the "Partnership"). The Partnership's principal executive
offices are located at c/o Wilder Richman Resources Corporation, 599 West Putnam
Avenue, Greenwich, CT 06830.
Item 2. Identity and Background.
(a) This Statement is being filed on behalf of West Putnam Housing Investors
II LLC, a Delaware limited liability company ("West Putnam II"), West
Putnam Housing Investors LLC, a Delaware limited liability company ("West
Putnam"), and Richard P. Richman (collectively, the "Reporting Persons").
(b) The business address and address of the principal office of each of the
Reporting Persons is 599 West Putnam Avenue, Greenwich, CT 06830.
(c) West Putnam and West Putnam II were both formed for the purpose of
investing in Secured Income L.P. (the "Partnership"). Mr. Richman is
principally engaged in the syndication, development, and management of
residential properties as the President of The Richman Group, Inc. and its
affiliates, which have a business address of 599 West Putnam Avenue,
Greenwich, CT 06830. Mr. Richman is the sole managing member of West
Putnam. West Putnam is the sole Managing Member of West Putnam II.
(d) None of the Reporting Persons has, during the five years prior to the date
hereof, been convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors).
(e) None of the Reporting Persons has been a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction, as a result of
which such person was or is subject to a judgment, decree or final order
enjoining future violations of, or prohibiting or mandating activities
subject to, Federal or State securities laws or finding any violation with
respect to such laws.
(f) Mr. Richman is a citizen of the United States of America.
Item 3. Source and Amount of Funds or Other Consideration.
West Putnam purchased Units in a tender offer consummated in August 1998
at a cost of $296,967.25. West Putnam purchased Units in a tender offer
consummated in August 2000 at a cost of $2,169,428 (see Item 5(c) for further
details of the purchase price). The source of funds for each of West Putnam and
West Putnam II was capital contributions from its members.
Item 4. Purpose of Transaction.
West Putnam II is 33-1/3% directly owned by West Putnam, which in turn
is directly owned by Mr. Richman and Robert H. Wilder. Messrs. Richman and
Wilder and certain other affiliates of West Putnam II control Wilder Richman
Resources Corporation, a Delaware corporation and WRC 87A Corporation, a
Delaware corporation, two of the three general partners of the Partnership.
Michael J. Levitt and Joel I. Picket indirectly own the remaining interests
in West Puntam II in equal parts. Mr.
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<PAGE>
Levitt has direct and indirect ownership interests in MJL Westmont, L.L.C., one
of the general partners of Columbia Westmont Associates L.P. (the "Columbia
Partnership"). The Columbia Partnership is one of the operating partnerships in
which the Partnership is invested. Mr. Picket has direct and indirect beneficial
ownership interests in Columbus Development Associates, LP, a limited partner in
the Columbia Partnership.
The Reporting Persons acquired the Units reported as beneficially owned by
them for investment purposes. The Reporting Persons have no current plans or
proposals which relate to or would result in any event described in
subparagraphs (a) through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
(a) The Reporting Persons may be deemed to beneficially own an aggregate of
227,178 Units, representing approximately 23.1% of the outstanding Units. West
Putnam directly holds 40,961 of such Units, representing approximately 4.2% of
the outstanding Units, and West Putnam II directly holds 186,217 of such Units,
representing approximately 18.9% of the outstanding Units.
(b) West Putnam and West Putnam II have the sole power to vote, direct the vote
of, dispose of, or direct the disposition of, the Units each such entity
directly holds. West Putnam is the sole managing member of West Putnam II and
may therefore be deemed to be a beneficial owner of all Units that West Putnam
II holds directly. Mr. Richman is the sole managing member of West Putnam and
may therefore be deemed to be a beneficial owner of all Units that West Putnam
and West Putnam II hold directly. West Putnam and Mr. Richman disclaim
beneficial ownership of the Units that they may be deemed to own beneficially by
reason of these relationships, except to the extent of their direct economic
interests. By reason of certain rights that they have under the limited
liability company agreement of West Putnam II referred to in Item 6, members of
West Putnam II may be deemed to have shared voting and dispositive rights over
the Units owned by West Putnam II.
(c) On August 21, 2000, West Putnam II accepted for purchase the Units that it
holds in a tender offer (the "Offer") which expired on August 18, 2000. The
purchase price per Unit in the Offer was $20.00, less $8.35 per Unit distributed
to Unit holders by the Partnership on July 31, 2000, resulting in a net payment
of $11.65 per Unit.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to the Securities of the Issuer.
The limited liability operating agreement of West Putnam II requires the
unanimous consent of West Putnam II's members for West Putnam II's exercising
any rights as a holder of Units, including, without limitation, selling or
otherwise disposing such Units or exercising the voting rights of such Units. A
copy of the limited liability company agreement of West Putnam II is annexed to
this Schedule 13D as Exhibit 2. A copy of the limited liability company
agreement of West Putnam II is annexed to this Schedule 13D as Exhibit 3.
Item 7. Material to be Filed as Exhibits.
1. Agreement of Joint Filing
2. Limited Liability Company Agreement of West Putnam II
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<PAGE>
3. Limited Liability Company Agreement of West Putnam
-7-
<PAGE>
SIGNATURE
After reasonable inquiry and to the best knowledge and belief of the
undersigned, the undersigned certify that the information set forth in this
Statement is true, complete, and correct.
Dated: August 31, 2000
WEST PUTNAM HOUSING INVESTORS II LLC
By: WEST PUTNAM HOUSING INVESTORS LLC,
its Managing Member
By: /s/ Richard P. Richman
--------------------------------------
Richard P. Richman, its Managing Member
WEST PUTNAM HOUSING INVESTORS LLC,
By: /s/ Richard P. Richman
--------------------------------------
Richard P. Richman, its Managing Member
RICHARD P. RICHMAN
/s/ Richard P. Richman
--------------------------------------
in his individual capacity
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<PAGE>
Exhibit 1
AGREEMENT OF JOINT FILING
The undersigned persons hereby agree to file with the Securities and
Exchange Commission the Statement on Schedule 13D (the "Statement") to which
this Agreement is attached as an exhibit, and agree that such Statement, as so
filed, is filed on behalf of each of them.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as
of August 31, 2000.
WEST PUTNAM HOUSING INVESTORS II LLC
By: WEST PUTNAM HOUSING INVESTORS LLC,
its Managing Member
By: /s/ Richard P. Richman
--------------------------------------
Richard P. Richman, its Managing Member
WEST PUTNAM HOUSING INVESTORS LLC,
By: /s/ Richard P. Richman
--------------------------------------
Richard P. Richman, its Managing Member
RICHARD P. RICHMAN
/s/ Richard P. Richman
--------------------------------------
in his individual capacity
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<PAGE>
Exhibit 2
WEST PUTNAM HOUSING INVESTORS II LLC
LIMITED LIABILITY COMPANY AGREEMENT
This Limited Liability Company Agreement (as the same may be amended
from time to time, this "Agreement") of West Putnam Housing Investors II LLC, a
Delaware limited liability company (the "Company"), is made and entered into by
and among the persons executing this Agreement as Members and shall be effective
as of the Effective Date (as defined below).
ARTICLE ONE
DEFINITIONS
For purposes of this Agreement, unless the context otherwise
requires, terms shall be used with the meanings given to them under the Act, and
the following terms shall have the meanings set forth hereafter:
1.1. "Act" means the Delaware Limited Liability Company Act and any and all
amendments and modifications thereto.
1.2. "Change of Control" means, with respect to a given Member, that
(a) any Person becomes the beneficial owner of 50% or more of such Member's
voting equity interests; provided, however, that a Change of Control will not
occur if the Person owning the voting equity interests of such Member as of the
Effective Date transfers the economic rights of such Member's voting equity
interests to one or more immediate family members but retains the voting rights
of such voting equity interests;
(b) individuals or entities who constitute the managing member(s),
director(s), general partner(s) or other governing individuals or body of such
Member at the time of such Member is admitted as a member of the Company cease
to constitute a majority of such governing individuals or body;
(c) any merger or consolidation of a Member with or into any other entity
is approved by the equity holders thereof; or
(d) the equity holders of such Member approve a plan of liquidation of such
Member or an agreement for the sale or disposition by the Member of all or
substantially all of such Member's assets.
1.3. "Capital Contribution" means any contribution of Property actually made
by or on behalf of a Member.
1.4. "Disposition" means any sale, assignment, transfer, exchange, mortgage,
pledge, grant, hypothecation or other transfer, whether absolute or as security
or encumbrance (including dispositions by operation of law). "Dispose" means to
make a Disposition.
<PAGE>
1.5. "Dissolution Event" means an event, the occurrence of which will result in
the dissolution of the Company under Article Eight hereof.
1.6. "Effective Date" means the date on which the certificate of formation of
the Company was filed with the Delaware Secretary of State.
1.7. "Managing Member" means West Putnam Housing Investors LLC or any Person
elected as a successor Managing Member pursuant to the terms of this Agreement.
1.8. "Member" means each Person who executes this Agreement as a Member for so
long as such Person remains a member of the Company and any successor or other
Person subsequently admitted as a member of the Company.
1.9. "Percentage Interest" means a Member's percentage ownership interest of the
equity in the Company as set forth in Schedule A hereto, as the same may be
amended from time to time.
1.10. "Person" means any individual, estate, corporation, trust, joint venture,
partnership or limited liability company of every kind and nature, and any other
individual or entity in its own or any representative capacity.
1.11. "Property" means any property, real or personal, tangible or intangible,
including money, and any legal or equitable interest in such property, but
excluding services and promises to perform services in the future.
ARTICLE TWO
FORMATION
2.1. Organization. The Members hereby organize the Company as a Delaware
limited liability company pursuant to the provisions of the Act.
2.2. Term. The Company shall be dissolved and its affairs wound up as
provided in the Act and this Agreement on July 15, 2050, unless the Company
shall be sooner dissolved and its affairs wound up in accordance with the Act
or this Agreement.
2.3. Registered Agent and Office. The registered agent for the service of
process and the registered office shall be Corporation Service Company, 1013
Centre Road, Wilmington, Delaware 19805-1297. In the event the registered agent
ceases to act as such for any reason or the registered office shall change, the
Members shall promptly designate a replacement registered agent or file a notice
of change of address, as the case may be.
2.4. Principal Office. The principal office of the Company shall be located
at 599 West Putnam Avenue, Greenwich, Connecticut 06830, or such other
location as the Managing Member shall designate by notice to the Members.
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<PAGE>
ARTICLE THREE
PURPOSE
The Company has been formed for the principal purpose of acquiring
and investing in certain limited partnership interests, and buying, selling,
investing, reinvesting, owning, managing and otherwise dealing with any other
type of property hereafter acquired by the Company, whether real or personal,
tangible or intangible. The Company may engage in any other lawful act or
activity for which a limited liability company may be formed under the Act,
including, without limitation, borrowing money and entering into loan, security,
guarantee and or other agreements related thereto.
ARTICLE FOUR
RIGHTS AND DUTIES OF MEMBERS
4.1. Management Rights.
(a) Subject to Section 4.1(b), the business and affairs of the Company
shall be managed by its Managing Member and, except as may be specifically
provided in this Agreement, no other Member, as such, shall have the right or
authority to bind the Company. Subject to Section 4.1(b), the Managing Member
shall have the power, on behalf of the Company, to do all things necessary or
convenient to carry out the business and affairs of the Company. West Putnam
Housing Investors LLC shall be the initial Managing Member of the Company and
shall continue in that capacity until it is dissolved or resigns or is removed
by the Members. In the event that the Managing Member shall die, be dissolved,
resign, or be removed, the Members shall elect one or more successor Managing
Member(s) by vote of Members holding a majority of all Percentage Interests. Any
action which may be taken at a meeting of the Members may be taken without a
meeting if Members casting votes sufficient to approve such action consent
thereto in writing.
(b) Notwithstanding anything in Section 4.1(a) to the contrary, the
following actions by the Company shall require the unanimous consent of the
Members:
(i) altering any of the terms of any tender offer conducted by the
Company for the units of limited partnership interest ("Units") of Secured
Income L.P., a Delaware limited partnership ("Secured Income"), including,
without limitation, extending or terminating such tender offer or changing the
per-Unit purchase price thereof;
(ii) exercising any rights as a holder of Units, including, without
limitation, selling or otherwise disposing such Units or exercising the voting
rights of such Units;
(iii) making any distribution of Company Property to Unit Holders; or
(iv) causing the Company to be dissolved or liquidated or its affairs
to be wound up.
(c) In carrying out its duties and responsibilities hereunder, the Managing
Member may, but shall not be obligated to, appoint individuals as officers of
the Company in each of the following positions: President, Executive Vice
President, Senior Vice President, Vice President,
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<PAGE>
Assistant Vice President, Secretary and Treasurer. Each of such individuals
shall serve at the pleasure of the Managing Member. An officer may but need not
be a Member or an employee of a Member of the Company.
4.2. Authority to Bind the Company. Unless all of the Members otherwise agree in
writing, no agreement, undertaking, instrument, written obligation, certificate
or other commitment shall be made by or on behalf of the Company unless made in
an instrument signed by the Managing Member.
4.3. Percentage Interests. The Percentage Interests may be adjusted from time to
time as agreed by all of the Members. The Managing Member may amend Schedule A
hereto from time to time to reflect any addition, withdrawal, or change in
Members or any adjustments to any Member's Capital Contribution or Percentage
Interest.
4.4. Reimbursement. The Managing Member and any affiliates of the Managing
Member shall be reimbursed for all costs and expenses incurred by them on behalf
of the Company, including, but not limited to, legal fees relating to the
formation of the company, current and recurring legal and accounting expenses,
and other costs associated with the Company's operations.
4.5. Liability. Except as otherwise provided under Section 4.6, the debts,
obligations and liabilities of the Company, whether arising in contract, tort or
otherwise, shall be solely the debts, obligations and liabilities of the
Company. The Managing Member, any other Member, and their respective members,
officers, and other controlling persons through which the Managing Member or
Member acts (collectively, "Controlling Persons") shall not be obligated
personally for any such debt, obligation or liability of the Company or any
other Member solely by reason of being the Managing Member, a Member, or a
Controlling Person. The failure of the Company to observe any formalities or
requirements relating to the exercise of its powers or management of its
business or affairs under this Agreement or the Act shall not be grounds for
imposing personal liability on a Managing Member, any other Member, or any
Controlling Person for the liabilities of the Company.
4.6. Exculpation. The Managing Member, any other Member, their respective
Controlling Persons, and any officer of the Company shall not be liable to the
Company or any Member for any loss, damage or claim incurred by reason of any
act or omission of such Person in good faith on behalf of the Company and in a
manner reasonably believed to be within the scope of authority conferred on such
Person by this Agreement.
4.7. Indemnification. Any Person who was or is a Managing Member, Member,
Controlling Person, or officer of the Company (an "Indemnified Party") shall be
indemnified and held harmless by the Company from and against any and all
losses, claims, damages, liabilities, expenses (including reasonable legal and
other professional fees and disbursements), judgments, fines, settlements, and
other amounts incurred (collectively, the "Indemnification Obligations") in
connection with any and all claims, demands, actions, suits or proceedings
(civil, criminal, administrative, or investigative), actual or threatened, in
which such Indemnified Party may be involved, as a party or otherwise, by reason
of such Indemnified Party's service to, or on behalf of, or management of the
affairs of, the Company, or rendering of advice or consultation with respect
thereto, whether or not the Indemnified Party continues to be serving in the
above-
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<PAGE>
described capacity at the time any such Indemnification Obligation is paid
or incurred. Notwithstanding the foregoing, the Company shall not provide
indemnification regarding any Indemnification Obligation to the extent resulting
from action or inaction of such Indemnified Party that, in each case,
constituted gross negligence, willful misconduct, a breach of the Indemnified
Party's fiduciary duty or duty of loyalty to the Company, or an act (a) that was
in bad faith, (b) that involved a knowing violation of law, or (c) from which
the Indemnified Party derived an improper personal benefit. The termination of a
proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere, or its equivalent, shall not, of itself, create a presumption that
such Indemnification Obligation resulted from the gross negligence or willful
misconduct of such Indemnified Party. Expenses (including reasonable legal and
other professional fees and disbursements) incurred in any proceeding will be
paid by the Company, as incurred, in advance of the final disposition of such
proceeding upon receipt of an undertaking by or on behalf of such Indemnified
Party to repay such amount if it shall ultimately be determined that such
Indemnified Party is not entitled to be indemnified by the Company as authorized
hereunder.
ARTICLE FIVE
CAPITAL CONTRIBUTIONS
5.1. Generally. The Members' Capital Contributions are as set forth beside their
respective names in Schedule A hereto. The Members shall make such additional
Capital Contributions to the Company as the Managing Member may require from
time to time. Any such capital contributions shall be made in proportion to the
Members' Percentage Interests in the Company. No interest shall accrue on any
such Capital Contribution, and no Member shall have the right to withdraw or be
repaid any such Capital Contribution, except as specifically provided in this
Agreement.
5.2. Capital Accounts.
(a) A capital account shall be established for each Member on the books of
the Company. Each Member's capital account shall be credited with such Member's
initial Capital Contribution as set forth in Schedule A hereto, any additional
Capital Contributions made by or on behalf of such Member, such Member's
distributive share of profits, and the amount of any Company liabilities that
are assumed by such Member or that are secured by any Company property
distributed to such Member.
(b) Each Member's capital account shall be debited with the amount of cash
and the value of any Company property distributed to such Member pursuant to any
provision of this Agreement, such Member's distributive share of losses, and the
amount of any liabilities of such Member that are assumed by the Company or that
are secured by any property contributed by such Member to the Company.
(c) In the event any Percentage Interest in the Company is transferred in
accordance with the terms of this Agreement, the transferee shall succeed to the
capital account of the transferor to the extent it relates to the transferred
interest.
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<PAGE>
(d) The Managing Member shall maintain the Members' capital accounts in
accordance with the Internal Revenue Code (the "Code") Section 704(b) and with
Treasury Regulation Section 1.704-1(b). In the event the Managing Member shall
determine that it is prudent to modify the manner in which the capital accounts,
or any debits or credits thereto, are computed in order to comply with such
Regulations, the Managing Member may make such modification, provided that it is
not likely to have a material effect on the amounts distributable to any Member
pursuant to Article Seven hereof or upon the dissolution of the Company.
ARTICLE SIX
ALLOCATION OF PROFITS AND LOSSES; DISTRIBUTIONS
The profits and losses from operations of the Company for any fiscal
year or other period or from the sale or other disposition of all or any part of
the Company's Property, whether or not they result in a dissolution and
liquidation of the Company, shall be allocated to the Members in accordance with
their Percentage Interests in the Company. Distributions of Property of the
Company shall be made at such times, in such manner and in such amounts as the
Managing Member may determine; provided, however, that each such distribution
shall be made to the Members in accordance with their respective Percentage
Interests in the Company.
ARTICLE SEVEN
DISPOSITION OF MEMBERSHIP INTERESTS
7.1. Generally.
(a) Restrictions on Dispositions.
(i) No Member shall sell, assign, transfer, bequeath, donate, or grant
a security interest in, encumber, pledge, or in any way dispose of its interest
in the Company (including any beneficial or economic interest therein) or any
part thereof, either voluntarily or involuntarily, or withdraw or retire from
the Company, without the consent of all Members, which consent may be withheld
arbitrarily; provided, however, that a Member may transfer its membership
interest to another entity that is under common control with such Member
following written notice to the Company without the consent of the Members. For
purposes of the preceding sentence, two Persons shall be deemed to be under
"common control" if a single Person, directly or through one or more
intermediaries, beneficially owns more than 50% of the voting equity interests
that have the right to manage the business and affairs of such two Persons.
(ii) Prior written notice of any transfer shall be promptly provided
to the other Members and the Company, and such transfer shall not be deemed
finally effected in the books and records of the Company unless and until the
transferee shall execute such documents, as shall be prepared by counsel to the
Company, to confirm the foregoing and to accept the terms and provisions of this
Agreement.
(b) The transferee of any Member's interest in the Company shall be subject
to all the terms, conditions, restrictions and obligations of this Agreement,
including the provisions of this Section.
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(c) Change of Control.
(i) Each Member shall give prompt written notice to the Company of any
Change in Control with respect to such Member. The Company shall have the option
to purchase the interest of such Member or its successor for a period of six (6)
months from the date of such notice. The option shall be exercised by written
notice to the Member or its successor. The purchase price, payment method and
manner of closing shall be as set forth in Sections 7.1(d) and (e).
(ii) If the Company shall not elect to purchase the entire interest of
such Member within the six (6) month period described above, the remaining
Members shall have the option to purchase all or the remaining part thereof, as
the case may be, from such Member or its successor for a period of an additional
three (3) months, in proportion to their interests in the Company. Members
electing to purchase the interest of such Member shall have the right to
purchase, pro rata, any portion of the interest not subscribed for by the other
remaining Members. The Company and the other remaining Members in the aggregate
must elect to purchase the entire interest offered or the option shall be deemed
not exercised. The purchase price, payment method and manner of closing shall be
as set forth in Sections 7.1(d) and (e).
(d) Exercise of purchase option.
(i) If the Company or remaining Members shall exercise the option
granted pursuant to 7.1(c), the purchase price of such Member's interest in the
Company shall be determined as hereinafter set forth.
(ii) If the Company (or remaining Members) and the Member or its
successor agree on a purchase price for the Member's interest, such agreed upon
price shall be the purchase price. If the parties cannot agree on a purchase
price for a Member's interest within ninety (90) days from the date of the
written notice of election by the Company or remaining Members, the purchase
price for such Member's interest shall be an amount equal to the net fair market
value (i.e., after debts and obligations) of the Company's Property multiplied
by such Member's Percentage Interest in the Company. In determining net fair
market value, the Company (or remaining Members) and the Member or its successor
in interest shall agree upon an appraiser who shall determine the net fair
market value of the Company's Property. If the parties cannot agree upon an
appraiser, each shall appoint an appraiser and the two appraisers so chosen
shall appoint a third appraiser. If the two appraisers cannot agree upon a third
appraiser, the third appraiser shall be selected under the Commercial
Arbitration Rules of the American Arbitration Association. All of the appraisers
shall be MAI certified unless all of the parties waive this requirement. The
three appraisers shall determine the net fair market value of the Company's
Property. However, if they are unable to agree upon a net fair market value,
each appraiser shall submit a report as to his or its determination of net fair
market value, and the average of the two closest computed net fair market values
shall be the net fair market value. Each side shall bear the cost of its
appraiser and shall share equally the cost of the third appraiser. The
determination of net fair market value by the appraisers shall be made within
forty-five (45) days after the expiration of the ninety (90) day period referred
to above.
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<PAGE>
(e) Closing of purchase option sale. The closing of a sale pursuant to
Section 7.1(d) shall be held at a mutually convenient place and on a mutually
convenient business day within thirty (30) days following the determination of
the purchase price. The Company (or remaining Members) shall have the right to
elect to pay up to eighty percent (80%) of the purchase price by delivering a
promissory note which (i) shall be due within five (5) years of the closing
date, (ii) shall provide for interest at the "Prime Rate" announced by Fleet
Bank, National Association, Hartford, Connecticut, as of the commencement date
of each year that the note exists and payable on the outstanding principal
balance of the note at the time payments of principal shall be due, (iii) shall
provide for quarterly payments of principal at the end of each quarter that the
note exists, which shall be sufficient to amortize the principal amount of the
note over the term of the note, (iv) shall permit prepayment in full or in part
without penalty or premium, together with all accrued and unpaid interest, (v)
shall allow the holder to receive reasonable costs including attorneys' fees for
collection of the note and (vi) shall provide for the acceleration of the note
in the event of: the sale of all or substantially all of the assets of the
Company (and, where purchased by remaining Members, the sale of any interest in
the Company by any such remaining Member) of or a default in the payment of
principal or interest on the note continuing for fifteen (15) days after the
same is due. The note shall also contain such other acceleration and default
provisions as typically would be contained in such a commercial note.
7.2. Non-compliant Dispositions Void - Any attempted Disposition of a Member's
interest in the Company, or any part thereof, not in compliance with this
Article Seven is null and void ab initio.
ARTICLE EIGHT
DISSOLUTION AND WINDING UP
8.1. Dissolution. The Company shall be dissolved and its affairs wound up,
upon the first to occur of the following events (each of which shall
constitute a Dissolution Event):
(a) the expiration of the term established in Section 2.2 hereof;
(b) the written consent of all Members; or
(c) the entry of a decree of judicial dissolution under Section 18-802 of
the Act.
8.2. Effect of Dissolution. Upon dissolution, the Company shall cease carrying
on and begin winding up the Company business, but the Company is not terminated,
and shall continue, until the winding up of the affairs of the Company is
completed and a certificate of cancellation has been filed with the Delaware
Department of State.
8.3. Distribution of Assets on Dissolution. Upon the winding up of the
Company, the Property of the Company shall be distributed as provided in the
Act and among the Members in accordance with their respective Percentage
Interests in the Company.
8.4. Winding Up and Certificate of Cancellation. The winding up of the Company
shall be completed when all debts, liabilities and obligations of the Company
have been paid and discharged or reasonably adequate provision therefor has been
made, and all of the remaining Property of the Company has been distributed to
the Members. Upon the completion of winding
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<PAGE>
up of the Company, a certificate of cancellation, which shall set forth the
information required by the Act, shall be filed in the Delaware Department of
State.
ARTICLE NINE
MISCELLANEOUS PROVISIONS
9.1. Entire Agreement; Amendment. This Agreement represents the entire
agreement among the Members and between the Members and the Company with
respect to the subject matter hereof. This Agreement may be amended only by
a written instrument signed by all of the Members.
9.2. Rights of Creditors and Third Parties under Agreement. This Agreement is
entered into among the Company and the Members for the exclusive benefit of the
Company, the Members and their successors and permitted transferees. This
Agreement is expressly not intended for the benefit of any creditor of the
Company or any other Person. No such creditor or other Person shall have any
rights under this Agreement or any agreement between the Company and any Member
with respect to any capital contribution, any Member's interest in the Company
or otherwise.
9.3. Counterparts. This Agreement may be executed in two or more
counterparts, all of which taken together shall be deemed one agreement.
9.4. Notice. All notices made pursuant hereto shall be in writing. Notice to the
Company shall be addressed to the Company at the address of its principal office
established as provided in Section 2.4 hereof. Notice to a Member shall be
addressed to the Member at the address of such Member reflected in the records
of the Company. Notice shall be considered duly given (a) on the day when
delivered personally, (b) on the business day when sent by facsimile provided
receipt of such transmission is confirmed, (c) on the business day immediately
succeeding the day on which Notice is sent by recognized overnight courier, and
(d) when received if mailed by first class mail postage prepaid.
[Remainder of page intentionally left blank; signature page follows]
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IN WITNESS WHEREOF, the undersigned Members have executed this
Agreement as of the Effective Date.
WEST PUTNAM HOUSING INVESTORS LLC
By: /s/ Richard P. Richman
----------------------------
Name: Richard P. Richman
Title: Managing Member
MJL WESTMONT, L.L.C.
By: /s/ Michael J. Levitt
-----------------------------
Name: Michael J. Levitt
Title: Member
COLUMBUS DEVELOPMENT ASSOCIATES, L.P.
By: Colum Development, LLC, a general partner
By: /s/ Joel I. Picket
-------------------------------
Name: Joel I. Picket
Title: Manager
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<PAGE>
Exhibit 3
WEST PUTNAM HOUSING INVESTORS LLC
LIMITED LIABILITY COMPANY AGREEMENT
This Limited Liability Company Agreement of West Putnam Housing
Investors LLC, a Delaware limited liability company (the "Company"), is made and
entered into by and among the persons executing this Agreement as Members and
shall be effective as of the Effective Date (as defined below).
ARTICLE I
DEFINITIONS
For purposes of this Agreement, unless the context otherwise
requires, terms shall be used with the meanings given to them under the Act, and
the following terms shall have the meanings set forth hereafter:
1. Act - The Delaware Limited Liability Company Law and any and all
amendments and modifications thereto.
2. Agreement - This Limited Liability Company Agreement, as the same
may be amended from time to time.
3. Capital Contribution - Any contribution of Property actually made
by or on behalf of a Member.
4. Disposition (Dispose) - Any sale, assignment, transfer, exchange,
mortgage, pledge, grant, hypothecation or other transfer, whether absolute or as
security or encumbrance (including dispositions by operation of law).
5. Dissolution Event - An event, the occurrence of which will result
in the dissolution of the Company under Article VIII hereof.
6. Effective Date - The date on which the certificate of formation
of the Company was filed with the Delaware Secretary of State.
7. Member - Each Person who executes this Agreement as a Member, and
their respective successors.
8. Percentage Interest - The percentage interest of a Member as set
forth in Schedule A hereto.
9. Person - Any individual, estate, corporation, trust, joint
venture, partnership or limited liability company of every kind and nature, and
any other individual or entity in its own or any representative capacity.
<PAGE>
10. Property - Any property, real or personal, tangible or
intangible, including money, and any legal or equitable interest in such
property, but excluding services and promises to perform services in the future.
ARTICLE II
FORMATION
1. Organization - The Members hereby organize the Company as a
Delaware limited liability company pursuant to the provisions of the Act.
2. Term - The Company shall be dissolved and its affairs wound up as
provided in the Act and this Agreement on July 15, 2048, unless the Company
shall be sooner dissolved and its affairs wound up in accordance with the Act or
this Agreement.
3. Registered Agent and Office - The registered agent for the
service of process and the registered office shall be Corporation Service
Company, 1013 Centre Road, Wilmington, Delaware 19805-1297. In the event the
registered agent ceases to act as such for any reason or the registered office
shall change, the Members shall promptly designate a replacement registered
agent or file a notice of change of address, as the case may be.
4. Principal Office - The principal office of the Company shall be
located at 599 West Putnam Avenue, Greenwich, Connecticut 06830, or such other
location as the Managing Member shall designate by notice to the Members.
ARTICLE III
PURPOSE
The Company has been formed for the principal purpose of acquiring
and investing in certain limited partnership interests, and buying, selling,
investing, reinvesting, owning, managing and otherwise dealing with any other
type of property hereafter acquired by the Company, whether real or personal,
tangible or intangible. The Company may engage in any other lawful act or
activity for which a limited liability company may be formed under the Act,
including, without limitation, borrowing money and entering into loan, security
and/or guarantee agreements related thereto.
ARTICLE IV
RIGHTS AND DUTIES OF MEMBERS
1. Management Rights - (a) The business and affairs of the Company
shall be managed by its Managing Member and, except as may be specifically
provided in this Agreement, no other Member, as such, shall have the right or
authority to bind the Company. The Managing Member shall have the power, on
behalf of the Company, to do all things necessary or convenient to carry out the
business and affairs of the Company. Mr. Richard P. Richman shall be the
Managing Member of the Company, and shall continue in that capacity until he
dies or resigns or is removed by the Members. In the event that the Managing
Member
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shall die, resign or be removed, one or more successor Managing Member[s] shall
be elected by the Members. All Members shall be entitled to vote on all matters
requiring the approval of the Members. All matters submitted for the approval of
the Members shall require the vote of a Majority of the Members for passage. For
purposes of this Agreement, whenever the consent or approval of the Members is
required, it shall mean the consent or approval of more than fifty percent (50%)
of the Percentage Interests in the Company. Any action which may be taken at a
meeting of the Members may be taken without a meeting if Members casting votes
sufficient to approve such action consent thereto in writing.
(b) In carrying out his duties and responsibilities hereunder,
the Managing Member may, but shall not be obligated to, appoint individuals as
officers of the Company in each of the following positions: President, Executive
Vice President, Senior Vice President, Vice President, Assistant Vice President,
Secretary and Treasurer. Each of such individuals may serve at the pleasure of
the Managing Member. An officer may but need not be a Member of the Company.
2. Authority to Bind the Company - Unless the Members otherwise
agree, no agreement, undertaking, instrument, written obligation, certificate or
other commitment shall be made by or on behalf of the Company unless made in an
instrument signed by the Managing Member.
3. Company Interests - The Percentage Interest in the Company of
each Member shall be as set forth on Schedule A hereto. The Percentage Interests
may be adjusted from time to time as agreed by all of the Members.
4. Liability of Members - No Member shall be liable for the
obligations or liabilities of the Company. The failure of the Company to observe
any formalities or requirements relating to the exercise of its powers or
management of its business or affairs under this Agreement or the Act shall not
be grounds for imposing personal liability on any Member for the liabilities of
the Company.
ARTICLE V
CONTRIBUTIONS
The Members have contributed or will contribute to the capital of
the Company the amounts set forth beside their respective names of Schedule A
hereof. The Members shall make such additional Capital Contributions to the
Company as the Managing Member may require from time to time. Any such capital
contributions shall be made in proportion to the Members' Percentage Interests
in the Company. No interest shall accrue on any such Capital Contribution, and
no Member shall have the right to withdraw or be repaid any such Capital
Contribution, except as provided in this Agreement.
A capital account shall be established for each Member on the books
of the Company. Each Member's capital account shall be credited with such
Member's initial Capital Contribution as set forth in Schedule A hereto, any
additional Capital Contributions made by or
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on behalf of such Member, such Member's distributive share of profits, and the
amount of any Company liabilities that are assumed by such Member or that are
secured by any Company property distributed to such Member.
Each Member's capital account shall be debited with the amount of
cash and the value of any Company property distributed to such Member pursuant
to any provision of this Agreement, such Member's distributive share of losses,
and the amount of any liabilities of such Member that are assumed by the Company
or that are secured by any property contributed by such Member to the Company.
In the event any Percentage Interest in the Company is transferred
in accordance with the terms of this Agreement, the transferee shall succeed to
the capital account of the transferor to the extent it relates to the
transferred interest.
The Managing Member shall maintain the Members' capital accounts in
accordance with the Internal Revenue Code ("Code") Section 704(b) and with
Treasury Regulation Section 1.704-1(b). In the event the Managing Member shall
determine that it is prudent to modify the manner in which the capital accounts,
or any debits or credits thereto, are computed in order to comply with such
Regulations, the Managing Member may make such modification, provided that it is
not likely to have a material effect on the amounts distributable to any Member
pursuant to Article VII hereof or upon the dissolution of the Company.
ARTICLE VI
ALLOCATION OF PROFITS AND LOSSES; DISTRIBUTIONS
The profits and losses from operations of the Company for any fiscal
year or other period or from the sale or other disposition of all or any part of
the Company's Property, whether or not they result in a dissolution and
liquidation of the Company, shall be allocated to the Members in accordance with
their Percentage Interests in the Company. Distributions of Property of the
Company shall be made at such times, in such manner and in such amounts as the
Managing Member may determine; provided, however, that each such distribution
shall be made to the Members in accordance with their respective Percentage
Interests in the Company.
ARTICLE VII
DISPOSITION OF MEMBERSHIP INTERESTS
1. Disposition - (a) (i) Except as provided below, no Member shall
sell, assign, transfer, bequeath, donate, or grant a security interest in,
encumber, pledge, or in any way dispose of his or her interest in the Company
(including any beneficial or economic interest therein) or any part thereof,
either voluntarily or involuntarily, or withdraw or retire from the Company,
without the consent of the Managing Member and the consent of a
majority-in-interest of the remaining Members, which consent may be withheld
arbitrarily.
(ii) Notwithstanding the foregoing, a Member shall,
however, have the right to transfer a portion, but not all, of his or her
interest in the Company to his or her spouse and/or children and/or to trusts
for his or her benefit or the benefit of his or her spouse
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and/or children or to custodian for his or her children under the Uniform Gift
to Minors Act (UGMA), provided that the said transferring Member is appointed as
the irrevocable agent to act on behalf of any such transferees for all purposes
related to said transferred membership interest, and that the transferees shall,
by their acceptance of said interest, be bound by and subject to all of the
terms and provisions of this Agreement.
(iii) Notice of any transfer shall be promptly
provided to the other Members and the Company, and such transfer shall not be
deemed finally effected in the books and records of the Company unless and until
the transferee shall execute such documents, as shall be prepared by counsel to
the Company, to confirm the foregoing and to accept the terms and provisions of
this Agreement.
(b) The transferee of any Member's interest in the Company
shall be subject to all the terms, conditions, restrictions and obligations of
this Agreement, including the provisions of this Section.
(c) Upon the death of a Member, if such Member's interest in
the Company shall be bequeathed or otherwise pass to a person other than a
spouse or lineal descendant of such Member (or to or for the benefit of
(including a transfer in trust) the aforesaid parties), or in the event of any
involuntary transfer of an interest in the Company (which shall include, but not
be limited to, any levy, foreclosure or attachment of a Member's interest, or
the bankruptcy, voluntary or involuntary, of a Member), the Company shall have
the option to purchase the interest of such Member from his or her personal
representative or other successor in interest for a period of six (6) months
from the date of appointment of a personal representative of the deceased Member
or the date of transfer. The option shall be exercised by written notice to the
personal representative or other successor in interest. The purchase price,
payment method and manner of closing shall be as set forth in paragraphs (d) and
(e) below.
If the Company shall not elect to purchase the entire interest of
such Member within the six (6) month period described above, the remaining
Members shall have the option to purchase all or the remaining part thereof, as
the case may be, from such Member's personal representative or other successor
in interest for a period of an additional three (3) months, in proportion to
their interests in the Company. Members electing to purchase the interest of
such Member shall have the right to purchase, pro rata, any portion of the
interest not subscribed for by the other remaining Members. The Company and the
other remaining Members in the aggregate must elect to purchase the entire
interest offered or the option shall be deemed not exercised. The purchase
price, payment method and manner of closing shall be as set forth in paragraphs
(d) and (e) below.
(d) If the Company or remaining Members shall exercise the
option granted pursuant to Paragraph (c) hereof, the purchase price of such
Member's interest in the Company shall be determined as hereinafter set forth.
If the Company (or remaining Members) and the personal
representative or other successor in interest agree on a purchase price for the
Member's interest, such agreed upon price shall be the purchase price. If the
parties cannot agree on a purchase price for a Member's interest within ninety
(90) days from the date of the written notice of election by the Company or
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remaining Members, the purchase price for such Member's interest shall be an
amount equal to the net fair market value (i.e., after debts and obligations) of
the Company's Property multiplied by such Member's Percentage Interest in the
Company. In determining net fair market value, the Company (or remaining
Members) and the personal representative or other successor in interest shall
agree upon an appraiser who shall determine the net fair market value of the
Company's Property. If the parties cannot agree upon an appraiser, each shall
appoint an appraiser and the two appraisers so chosen shall appoint a third
appraiser. If the two appraisers cannot agree upon a third appraiser, the third
appraiser shall be selected under the Commercial Arbitration Rules of the
American Arbitration Association. All of the appraisers shall be MAI certified
unless all of the parties waive this requirement. The three appraisers shall
determine the net fair market value of the Company's Property. However, if they
are unable to agree upon a net fair market value, each appraiser shall submit a
report as to his or its determination of net fair market value, and the average
of the two closest computed net fair market values shall be the net fair market
value. Each side shall bear the cost of its appraiser and shall share equally
the cost of the third appraiser. The determination of net fair market value by
the appraisers shall be made within forty-five (45) days after the expiration of
the ninety (90) day period referred to above.
(e) The closing of a sale pursuant to paragraph (d) hereof
shall be held at a mutually convenient place and on a mutually convenient
business day within thirty (30) days following the determination of the purchase
price. The Company (or remaining Members) shall have the right to elect to pay
up to eighty percent (80%) of the purchase price by delivering a promissory note
which shall be due within five (5) years of the closing date, shall provide for
interest at the "Prime Rate" announced by Fleet Bank, National Association,
Hartford, Connecticut, as of the commencement date of each year that the note
exists and payable on the outstanding principal balance of the note at the time
payments of principal shall be due, shall provide for quarterly payments of
principal at the end of each quarter that the note exists, which shall be
sufficient to amortize the principal amount of the note over the term of the
note, shall permit prepayment in full or in part without penalty or premium,
together with all accrued and unpaid interest, shall allow the holder to receive
reasonable costs including attorneys' fees for collection of the note and shall
provide for the acceleration of the note in the event of: the sale of all or
substantially all of the assets of the Company (and, where purchased by
remaining Members, the sale of any interest in the Company by any such remaining
Member) or a default in the payment of principal or interest on the note
continuing for fifteen (15) days after the same is due. The note shall also
contain such other acceleration and default provisions as would be typically
contained in such a commercial note.
2. Dispositions not in Compliance with this Article Void - Any
attempted Disposition of a Member's interest in the Company, or any part
thereof, not in compliance with this Article VII is null and void ab initio.
3. No Amendment - The provisions of this Article VII may not
be amended.
ARTICLE VIII
DISSOLUTION AND WINDING UP
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1. Dissolution - The Company shall be dissolved and its affairs
wound up, upon the first to occur of the following events (each of which shall
constitute a Dissolution Event):
(a) the expiration of the term established in Section 2
of Article II hereof;
(b) the written consent of the Members; or
(c) the entry of a decree of judicial dissolution under
Section 18-802 of the Act.
2. Effect of Dissolution - Upon dissolution, the Company shall cease
carrying on and begin winding up the Company business, but the Company is not
terminated, and shall continue, until the winding up of the affairs of the
Company is completed and articles of dissolution have been filed with the
Delaware Department of State.
3. Distribution of Assets on Dissolution - Upon the winding up of
the Company, the Property of the Company shall be distributed as provided in the
Act and among the Members in accordance with their respective Percentage
Interests in the Company.
4. Winding Up and Certificate of Cancellation - The winding up of
the Company shall be completed when all debts, liabilities and obligations of
the Company have been paid and discharged or reasonably adequate provision
therefor has been made, and all of the remaining Property of the Company has
been distributed to the Members. Upon the completion of winding up of the
Company, a certificate of cancellation, which shall set forth the information
required by the Act, shall be filed in the Delaware Department of State.
ARTICLE IX
MISCELLANEOUS PROVISIONS
1. Entire Agreement; Amendment - This Agreement represents the
entire agreement among the Members and between the Members and the Company with
respect to the subject matter hereof. This Agreement may be amended only by a
written instrument adopted by the Company as provided in this Agreement.
2. Rights of Creditors and Third Parties under Limited Liability
Company Agreement - This Agreement is entered into among the Company and the
Members for the exclusive benefit of the Company, the Members and their
successors. This Agreement is expressly not intended for the benefit of any
creditor of the Company or any other Person. No such creditor or other Person
shall have any rights under this Agreement or any agreement between the Company
and any Member with respect to any capital contribution, any Member's interest
in the Company or otherwise.
3. Indemnification - The Company shall indemnify and hold harmless,
and advance expenses to, any Member, from and against any and all claims and
demands whatsoever relating to, or arising out of, actions taken or not taken by
such Member in its capacity as such;
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provided, however, that no indemnification may be made to or on behalf of any
Member if a judgment or other final adjudication adverse to such Member
establishes (a) that its acts were committed in bad faith or were the result of
active and deliberate dishonesty and were material to the cause of action so
adjudicated or (b) that it personally gained in fact a financial profit or other
advantage to which he or she was not legally entitled.
4. Counterparts - This Agreement may be executed in two or more
counterparts, all of which taken together shall be deemed one agreement.
5. Notice - Notice shall be in writing. Notice to the Company shall
be addressed to the Company at the address of its principal office established
as provided in Section 4 of Article II. Notice to a Member shall be addressed to
the Member at the address of such Member reflected in the records of the
Company. Notice shall be considered duly given (i) on the day when delivered
personally, (ii) on the business day when sent by facsimile provided receipt of
such transmission is confirmed, (iii) on the business day immediately succeeding
the day on which Notice is sent by recognized overnight courier, and (iv) when
received if mailed by first class mail postage prepaid.
IN WITNESS WHEREOF, the Members have executed this Agreement as of
the Effective Date.
/s/ Richard P. Richman
-------------------------
Richard P. Richman
/s/ Robert H. Wilder, Jr.
-------------------------
Robert H. Wilder, Jr.
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