EXHIBIT 10.1
(REDACTED)
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
LIMITED LIABILITY COMPANY AGREEMENT
OF
AGRINOMICS LLC
AMONG
ACTTAG, INC.,
AGRITOPE, INC.
AND
▇▇▇▇▇-▇▇▇▇▇▇▇ AG COMPANY INC.
DATED AS OF JULY 1, 1999
LIMITED LIABILITY COMPANY AGREEMENT
AGRINOMICS LLC
THIS LIMITED LIABILITY COMPANY AGREEMENT of AGRINOMICS LLC (the
"Company") is made and shall be effective as of the 1st day of July, 1999 (the
"Effective Date"), by and among ACTTAG, INC., a Delaware corporation ("ACTTAG,
Inc.") that is a wholly-owned subsidiary of AGRITOPE, INC., a Delaware
corporation ("Agritope", ACTTAG, Inc.'s "Parent"), Agritope, and ▇▇▇▇▇-▇▇▇▇▇▇▇
AG COMPANY INC., a New York corporation ("RP Ag Co.") that is a wholly-owned
subsidiary of ▇▇▇▇▇-▇▇▇▇▇▇▇ AGRO S.A. ("▇▇▇▇▇-▇▇▇▇▇▇▇ Agro", RP Ag Co.'s
"Parent").
RECITALS
A. Agritope has instituted a functional genomics program to be
conducted under the name the "ACTTAG(TM) Gene Discovery Program." Agritope has
formed ACTTAG, Inc. by the contribution to it of all of Agritope's rights,
interests and obligations in, to and under certain preliminary agreements
related to the ACTTAG(TM) Gene Discovery Program as more fully described herein,
and certain existing collections of biological materials relating hereto as more
fully described in the Operating Plan and more particularly in Exhibit A hereto
(the "Existing Agritope Collection").
▇. ▇▇▇▇▇-▇▇▇▇▇▇▇ Agro desires to help support the ACTTAG(TM) Gene
Discovery Program and to participate therein.
C. ACTTAG, Inc. and RP Ag Co. desire to form AGRINOMICS LLC, as a
Delaware limited liability company, and to be its initial Members upon the terms
and conditions set forth herein. The Company will receive from ACTTAG, Inc. all
of ACTTAG, Inc.'s rights, interests and obligations in, to and under such
preliminary agreements, as well as the Existing Agritope Collection, contributed
to ACTTAG, Inc. by Agritope. Agritope is a party to this Agreement only for
purposes of Article 8, Article 9, and Sections 10.1(c), 10.4(b) and 15.15; it is
not a Member of the Company.
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and intending to be legally bound, ACTTAG, Inc., Agritope and RP Ag Co.
hereby agree as follows:
AGRINOMICS LLC 1 Limited Liability Company Agreement
ARTICLE 1
DEFINITIONS; INTERPRETATION
1.1 CERTAIN DEFINITIONS
In addition to the capitalized terms defined above, and to other
capitalized terms explicitly defined elsewhere in this Agreement, the following
capitalized terms used herein shall have the following meanings:
"ACT" means the Delaware Limited Liability Company Act, as provided in
Title 6, Chapter 18 of the Delaware Code, ss. 101 et. Seq., as amended from time
to time.
"ADJUSTED CAPITAL ACCOUNT" means, with respect to a Member, the balance
in such Member's Capital Account as of the end of the relevant taxable year of
the Company, after giving effect to the following adjustments: (a) increase such
Capital Account by any amounts which the Member is obligated to restore or is
treated as being obligated to restore pursuant to Regulation Sections
1.704-2(g)(1) and 1.704-2(i)(5); and (b) decrease such Capital Account by the
items described in Regulation Sections 1.704-l(b)(2)(ii)(d)(4), (5) and (6).
"ADJUSTED DEFICIT" means, with respect to any Member, the deficit
balance, if any, in such Member's Capital Account as of the end of the taxable
year of the Company, after giving effect to the following adjustments:
(a) The Capital Account shall be increased by any amounts that such
Member is obligated to restore pursuant to any provision of this Agreement or is
deemed to be obligated to restore pursuant to the next to last sentence of
Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and
(b) The Capital Account shall be decreased by the items described in
Regulations Sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5) and
1.704-1(b)(2)(ii)(d)(6).
The foregoing definition of Adjusted Deficit is intended to comply with
the provisions of Regulations Section 1.704-1(b)(2)(ii)(d) and shall be
interpreted consistently therewith.
"AFFILIATE" means, with respect to any Person, another Person that,
directly or indirectly, through one or more intermediaries, Controls, or is
Controlled by, or is under common Control with, such Person; provided, however,
that for purposes of Sections 10.2, 10.3, and 10.4, "Affiliate" shall mean only
an Affiliate (as above defined) that directly or indirectly, through one or more
intermediaries, controls, or is controlled by, or is under common control with,
such Person where "control" and "controlled" for such purposes means the
ownership of more than 50% of the share capital or voting rights of a Person.
AGRINOMICS LLC 2 Limited Liability Company Agreement
"AGREEMENT" means this Limited Liability Company Agreement of
AGRINOMICS LLC (including all Exhibits referenced herein), as amended, restated
or supplemented from time to time.
"AGRITOPE RESEARCH CONTRACTS" means: (a) the Research and Management
Contract between the Company and Agritope, in the form of Exhibit B hereto (the
"Agritope Research and Management Contract"), and (b) any other agreement
whereby Agritope or its Affiliates will perform research services for or with
the Company.
"ALLIANCE PARTY(IES)" means those third parties with which the Company
may from time to time enter into research contracts, subscription contracts,
license agreements, testing or certification agreements, marketing or
distribution agreements, or other agreements as contemplated under Section
2.5.2(d) or in the Operating Plan. In addition to each Member's role under its
respective Research Contract, the Members and their Affiliates will be eligible
to be Alliance Parties.
"ASSIGNMENT AND ASSUMPTION AGREEMENT" means the Assignment and
Assumption Agreement and ▇▇▇▇ of Sale substantially in the form of Exhibit C
hereto, whereby ACTTAG, Inc. will assign and transfer to the Company, and the
Company will assume and agree to perform, all of Agritope's rights, interests,
and obligations in, to, and under the Salk ACTTAG Research Agreement and the
University of Edinburgh ACTTAG Research Agreement, and whereby ACTTAG, Inc. will
sell and transfer to the Company all right, title and interest in and to the
Existing Agritope Collection, as contributed by Agritope to ACTTAG, Inc. [ * ].
"BANKRUPTCY" means, with respect to a Person, including without
limitation, a Parent, a Member or the Company, the occurrence of any of the
following: (a) the filing of a voluntary petition for relief under the U.S. or
French bankruptcy laws or an admission by such Person of such Person's inability
to pay its debts as they become due, (b) the making by such Person of a general
assignment for the benefit of creditors, (c) in the case of the filing of an
involuntary petition in bankruptcy against such Person, the filing of an answer
admitting the material allegations thereof or consenting to the entry of an
order for relief, or a default in answering the petition, (d) the entry of an
order for relief under the U.S. or French bankruptcy laws against such Person,
or (e) the entry of an order, judgment or decree of any court adjudicating such
Person bankrupt or appointing a trustee or receiver for such Person's assets.
The foregoing definition of "Bankruptcy" is intended to replace and shall
supersede and replace the definition of "Bankruptcy" set forth in Sections
18-101 (1) and 18-304 of the Act.
"BOARD" means the Board of Managers of the Company established in
accordance with Section 6.1. Each Member of the Board of Managers of the Company
is hereby designated as a "Manager" within the meaning of the Act.
"BUDGET" means the then-applicable budget for the Company prepared and
adopted in accordance with Section 6.9, or the Initial Budget, as the case may
be.
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
AGRINOMICS LLC 3 Limited Liability Company Agreement
"CAPITAL ACCOUNT" means the capital account to be determined and
maintained for each Member pursuant to Section 3.9 throughout the existence of
the Company in accordance with the capital accounting rules set forth in
Regulations Section 1.704-1(b). The provisions of this Agreement relating to the
maintenance of Capital Accounts shall be interpreted and applied in a manner
consistent with such Section of the Regulations.
"CAPITAL CONTRIBUTION" means, with respect to any Member, the amount of
money and the initial Gross Asset Value of any property (other than money)
contributed to the Company with respect to the Interest held by such Member,
including all Initial Capital Contributions and Additional Capital
Contributions.
"CHANGE OF CONTROL" means the acquisition, directly or indirectly,
beneficially or of record, by any one person or group (as "group" is defined in
Section 13(d)(3) of the Securities Exchange Act of 1934) that is, or that
includes, any company in the field of crop protection, seeds and crop
improvement (including, without limitation, plant biotechnologies) or an
Affiliate of any such company, of shares or options or other rights to purchase
shares representing in the aggregate 50% or more of the aggregate voting power
represented by the issued and outstanding capital stock of either Party or its
Parent, or any of its controlling Affiliates in any tier, or any Transferee
pursuant to Section 10.2 hereunder.
"CLOSING DATE" means the date of the Closing as described in Section
3.4 below.
"CODE" means the Internal Revenue Code of 1986, as amended from time to
time, or any corresponding provision or provisions of any succeeding law, and
any reference to a Section of the Code shall be deemed to include a reference to
any successor provision thereto as well as any Regulations promulgated under
such Section or successor provision.
"COMPANY MINIMUM GAIN" has the meaning of "partnership minimum gain"
set forth in Regulations Sections 1.704-2(b)(2) and 1.704-2(d).
"CONTROL," "CONTROLS" "IS CONTROLLED BY" mean (subject to the proviso
in the definition of "Affiliate" above) the possession, directly or indirectly,
of 50% of more of the share capital or voting rights of a Person.
"DEPRECIATION" means, for each Fiscal Year, an amount equal to the
depreciation, amortization or other cost recovery deduction allowable with
respect to an asset for such Fiscal Year, except that if the Gross Asset Value
of an asset differs from its adjusted basis for federal income tax purposes as
the beginning of such Fiscal Year, Depreciation shall be an amount which bears
the same ratio to such beginning Gross Asset Value as the federal income tax
depreciation, amortization or other cost recovery deduction for such Fiscal Year
bears to such beginning adjusted tax basis; PROVIDED, HOWEVER, that if the
adjusted basis for federal income tax purposes of an asset at the beginning of
such Fiscal Year is zero, Depreciation shall be determined with reference to
such beginning Gross Asset Value using any reasonable method selected by the
Board.
AGRINOMICS LLC 4 Limited Liability Company Agreement
"FISCAL YEAR" means (a) the period commencing on the date the Company
was formed and ending on September 30, 1999, (b) any subsequent 12-month period
commencing on October 1 and ending on September 30, or (c) any portion of the
period described in clause (b) for which the Company is required to close its
books and allocate Profits, Losses, and other items of Company income, gain,
loss or deduction pursuant to Article 4.
"GROSS ASSET VALUE" means, with respect to any asset, the asset's
adjusted basis for federal income tax purposes, except as follows:
(a) The initial Gross Asset Value of any asset contributed by
a Member to the Company shall be the gross fair market value of such asset (i)
in the case of any asset contributed pursuant to Sections 3.1 through 3.6
hereof, as provided in such Sections, and (ii) with respect to any other
contributed asset, as determined by the contributing Member and the Board;
(b) The Gross Asset Values of Company assets shall be adjusted
to equal their respective gross fair market values, as determined by the Board,
as of the following times: (i) the acquisition of an additional Interest by any
new or existing Member in exchange for more than a DE MINIMIS Capital
Contribution; (ii) the distribution by the Company to a Member of more than a DE
MINIMIS amount of Property as consideration for an Interest; and (iii) the
liquidation of the Company within the meaning of Regulations Section
1.704-1(b)(2)(ii)(G); PROVIDED, HOWEVER, that the adjustments pursuant to
clauses (i) and (ii) above shall be made only if the Board reasonably determines
that such adjustments are necessary or appropriate to reflect the relative
economic interests of the Members in the Company;
(c) The Gross Asset Value of any Company asset distributed to
any Member shall be adjusted to equal the gross fair market value of such asset
on the date of distribution as determined by the distributee and the Board; and
(d) The Gross Asset Values of Company assets shall be
increased (or decreased) to reflect any adjustments to the adjusted basis of
such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to
the extent that such adjustments are taken into account in determining Capital
Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(M) and Section 3.7
hereof; PROVIDED, HOWEVER, that the Gross Asset Values shall not be adjusted
pursuant to this clause (d) to the extent the Board determines that an
adjustment pursuant to clause (b) hereof is necessary or appropriate in
connection with a transaction that would otherwise result in an adjustment
pursuant to this clause (d).
If the Gross Asset Value of an asset has been determined or adjusted
pursuant to clause (a), clause (b) or clause (d) hereof, such Gross Asset Value
shall thereafter be used for purposes of calculating Depreciation with respect
to such asset for purposes of determining Profits and Losses.
AGRINOMICS LLC 5 Limited Liability Company Agreement
"INITIAL BUDGET" means the Budget for the Company for the period from
the date of this Agreement to September 30, 2000, which shall be prepared by the
Company's CEO and approved by the Board prior to the Closing Date, which will be
attached hereto as Exhibit D.
"INITIAL CAPITAL CONTRIBUTIONS" means, with respect to each Member, the
Capital Contributions made by such Member pursuant to Section 3.1 or 3.2,
respectively, reduced by the amount of any liabilities of such Member assumed by
the Company in connection with such Capital Contribution or that are secured by
any property contributed by such Member as a part of such Capital Contribution.
"INITIAL OPERATING PLAN" means the operating plan for the Company,
which is attached hereto as Exhibit E.
"INTEREST" means a limited liability company interest in the Company
representing a Member's share of Profits and Losses of the Company and such
Member's right to receive distribution of the Company's assets in accordance
with the provisions of this Agreement and the Act, and including some or all of
the Capital Contributions made by a Member pursuant to Article 3, including any
and all benefits to which the holder of such an Interest may be entitled as
provided in this Agreement, together with all obligations of such Member to
comply with the terms and provisions of this Agreement.
"IRS" means the U.S. Internal Revenue Service.
"LIQUIDATING AGENT" shall refer to the Board or such other Person
designated by the Board as a liquidating trustee of the Company to conduct and
supervise the winding up and liquidation of the Company in accordance with
Section 5.3 and Article 11.
"MARKETING PROGRAM" means the commercial exploitation of the Company's
Property and rights derived from the Research Program.
"MEMBER NONRECOURSE DEBT" has the meaning of "partner nonrecourse debt"
set forth in Regulations Section 1.704-2(b)(4).
"MEMBER NONRECOURSE DEBT MINIMUM GAIN" means an amount, with respect to
each Member Nonrecourse Debt, equal to the Company Minimum Gain that would
result if such Member Nonrecourse Debt were treated as a Nonrecourse Liability
determined in accordance with Regulations Section 1.704-2(i)(3).
"MEMBERS" means ACTTAG, Inc. and/or RP Ag Co. as the parties to this
Agreement and includes any Person admitted as an additional Member or
substituted Member pursuant to the provisions of this Agreement, and, solely to
the extent provided in Section 10.5, any Non-Admitted Member as defined in that
Section. For purposes of the Act, the Members shall constitute one (1) class or
group of Members.
AGRINOMICS LLC 6 Limited Liability Company Agreement
"NET CASH FLOW" means, with respect to any Fiscal Year, the Profits or
Losses of the Company for such Fiscal Year DECREASED by (a) principal payments
to creditors (including Members in their capacity as creditors) of the Company
during such Fiscal Year, (b) capitalized expenditures incurred by the Company
during such Fiscal Year, (c) any amounts added to operating reserves during such
Fiscal Year, and (d) deductible expenditures paid for during the Fiscal Year to
the extent accrued and deducted in a prior Fiscal Year, and INCREASED by (i) any
deductions for federal income tax purposes for such Fiscal Year to the extent
such deductions do not involve the expenditure of cash by the Company during
such Fiscal Year (excluding any loss recognized for federal income tax purposes
on the sale, transfer or other disposition of any asset of the Company and taken
into account in determining Profits or Losses), (ii) any amounts withdrawn from
operating reserves during such Fiscal Year, (iii) the cash proceeds of any loans
made to the Company during the Fiscal Year, except to the extent the applicable
loan documents restrict the use of such proceeds, (iv) any cash Capital
Contributions made to the Company during the Fiscal Year, and (v) any proceeds
from the sale, transfer or other disposition of any assets of the Company
(excluding (A) such proceeds to the extent attributable to any gain recognized
on the disposition of such assets for federal income tax purposes and included
in Profits and (B) any proceeds from the sale, transfer or other disposition of
such assets in connection with a liquidation and dissolution of the Company).
"NONRECOURSE DEDUCTIONS" has the meaning set forth in Regulations
Section 1.704-2(b)(1).
"NONRECOURSE LIABILITY" has the meaning set forth in Regulations
Section 1.704-2(b)(3).
"OPERATING PLAN" means the then-applicable operating plan for the
Company, covering the Research Program and the Marketing Program, as prepared
and adopted in accordance with Section 6.9, or the Initial Operating Plan, as
the case may be.
"PARTIES" means all the parties to this Agreement and "Party" means any
one of them.
"PERCENTAGE INTEREST" means fifty percent (50%) with respect to ACTTAG,
Inc. and fifty percent (50%) with respect to RP Ag Co.
"PERSON" means any individual, corporation, partnership, limited
liability company, trust, association or other entity or organization, including
any governmental or political subdivision or any agency or instrumentality
thereof.
"PROFITS" and "LOSSES" mean the net taxable income and net tax loss of
the Company computed for each Fiscal Year or other relevant period, as
determined in accordance with Code Section 703(a) (for this purpose, all items
of income, gain, loss, or deduction required to be stated separately pursuant to
Code Section 703(a)(1) shall be included in taxable income or loss), with the
following adjustments:
AGRINOMICS LLC 7 Limited Liability Company Agreement
(a) Any income of the Company that is exempt from federal
income tax and not otherwise taken into account in computing Profits and Losses
pursuant to this clause (a) shall be added to such taxable income or loss;
(b) Any expenditures of the Company described in Code Section
705(a)(2)(B) (including expenditures treated as described in Code Section
705(a)(2)(B) under Regulations Section 1.704-1(b)(2)(iv)(i)), and not otherwise
taken into account in computing Profits and Losses pursuant to this definition,
shall be subtracted from such taxable income or loss;
(c) In the event the Gross Asset Value of any Company asset is
adjusted pursuant to the terms of this Agreement, the amount of such adjustment
shall be taken into account as gain or loss from the disposition of such asset
for purposes of computing Profits and Losses with respect to Regulation Section
1.704-1(b)(2);
(d) Gain or loss resulting from any disposition of property
with respect to which gain or loss is recognized for federal income tax purposes
shall be computed pursuant to Regulation Sections 1.704-1(b)(2)(F) and
1.704-1(b)(2)(G) by reference to the Gross Asset Value of the Property disposed
of, notwithstanding that the adjusted tax basis of such Property differs from
its Gross Asset Value;
(e) In lieu of the depreciation, amortization and other cost
recovery deductions taken into account in computing such taxable income or loss,
there shall be taken into account Depreciation for such Fiscal Year, computed in
accordance with the terms hereof pursuant to Regulation Section 1.704;
(f) To the extent an adjustment to the adjusted tax basis of
any Company asset pursuant to Code Section 734(b) or Code Section 743(b) is
required pursuant to Regulations Section 1.704-1(b)(2)(iv)(M)(4) to be taken
into account in determining Capital Accounts as a result of a distribution other
than in liquidation of the Member's interest, the amount of such adjustment
shall be treated as an item of gain (if the adjustment increases the basis of
the asset) or loss (if the adjustment decreases the basis of the asset) from the
disposition of the asset and shall be taken into account for purposes of
computing Profits or Losses; and
(g) Notwithstanding any other provisions of this Agreement,
any items that are specially allocated by the Company pursuant to Section 4.2
shall not be taken into account in computing Profits or Losses. The amount of
the items of Company income, gain, loss or deduction available to be specially
allocated pursuant to Section 4.2 shall be determined by applying rules
analogous to those set forth in this definition of Profits and Losses.
"PROPERTY" means all real and personal property acquired by the
Company, and any improvements thereto, and shall include tangible and intangible
property and intellectual properties.
AGRINOMICS LLC 8 Limited Liability Company Agreement
"REGULATIONS" means the income tax regulations promulgated under the
Code, as such regulations are amended from time to time (including corresponding
provisions of succeeding regulations).
"RESEARCH CONTRACT(S)" means one or more (as the context requires) of
the Agritope Research Contracts, the RP Ag Co. Research Contracts, the Salk
ACTTAG Research Agreement, the University of Edinburgh ACTTAG Research
Agreement, and contracts entered by the Company with any of the Alliance
Parties.
"RESEARCH PROGRAM" means the plant functional genomics program, also
called the "ACTTAG(TM) Gene Discovery Program," to be conducted and coordinated
by the Company at multiple research sites and involving the activation tagging
of large numbers of Arabidopsis plants in an attempt to create seeds and plants
in which one or more genes are overexpressed; screening to identify phenotypic
traits of interest in such plants; the isolation, sequencing and gene rescue of
the associated genotypes; and related activities, all as is more fully described
in the Operating Plan.
"RP AG CO. RESEARCH CONTRACTS" means: (a) the Research Contract and
License Agreement between the Company and RP Ag Co., in the form of Exhibit F
hereto (the "RP Ag Co. Research Contract and License Agreement"); and (b) any
other agreement whereby RP Ag Co. or its Affiliates will perform research
services for or with the Company.
"SALK ACTTAG RESEARCH AGREEMENT" means that certain Research, License
and Option Agreement dated as of October 23, 1998, by and between The Salk
Institute for Biological Sciences ("Salk") and Agritope, as amended prior to
Closing to the satisfaction of the Members.
"TRANSFER" means any sale, assignment, gift, hypothecation, pledge or
other disposition, directly or indirectly, whether voluntary or by operation of
law (including a merger or consolidation).
"UNIVERSITY OF EDINBURGH ACTTAG RESEARCH AGREEMENT" means that certain
Research and Option to License Agreement dated as of January 21, 1999, by and
between the University Court of the University of Edinburgh ("University of
Edinburgh") and Agritope.
"WINDING UP YEAR" means the U.S. taxable year of the Company in which
all of its assets are disposed of, or the Company liquidates (whichever occurs
first), and the immediately preceding taxable year if the disposition or
liquidation occurs prior to the due date (without regard to extensions) for
filing the Company's federal income tax return for the year immediately
preceding the year of disposition or liquidation.
1.2 INTERPRETATION
(a) Reference to a given Article, Section, Subsection, Exhibit or
Schedule is a reference to an Article, Section, Subsection, Exhibit or Schedule
AGRINOMICS LLC 9 Limited Liability Company Agreement
of this Agreement, unless otherwise specified. The terms "hereof," "herein,"
"hereto," "hereunder" and "herewith" refer to this Agreement as a whole.
(b) Except where otherwise expressly provided or unless the context
otherwise necessarily requires: (i) references to a given law or rule are
references to that law or rule as amended or modified as of the date on which
the reference is made, (ii) reference to a given agreement or instrument is a
reference to that agreement or instrument as originally executed, and as
modified, amended, supplemented and restated through the date as of which
reference is made to that agreement or instrument, and (iii) accounting terms
have the meanings given to them by generally accepted accounting principles in
the United States, applied on a consistent basis by the accounting entity to
which they refer ("GAAP").
(c) The singular includes the plural and the masculine includes the
feminine and neuter, and vice versa. "Includes" or "including" means "including,
without limitation."
(d) Headings set forth in this Agreement are used for convenience only
and are not to be considered in construing or interpreting this Agreement.
ARTICLE 2.
GENERAL PROVISIONS
2.1 NAME
The name of the Company shall be "AGRINOMICS LLC". All business of the
Company shall be conducted under such name and under such variations thereof as
the Board deems necessary or appropriate to comply with the requirements of law
in any jurisdiction in which the Company may elect to do business.
2.2 PRINCIPAL PLACE OF BUSINESS; REGISTERED OFFICE AND AGENT
(a) The address and principal place of business of the Company shall be
▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇▇, or at such other place
as the Board may from time to time determine.
(b) The registered office of the Company in the State of Delaware is
located at ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇. The
registered agent of the Company to accept service of process is The Corporation
Trust Company, whose address is ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
2.3 FORMATION OF COMPANY; CERTIFICATE
(a) The Members hereby agree to form the Company as a limited
liability company under and pursuant to the provisions of the Act and agree that
the rights, duties and liabilities of the Members shall be as provided in the
Act, except as otherwise provided herein.
AGRINOMICS LLC 10 Limited Liability Company Agreement
(b) This Agreement is effective upon the execution of this
Agreement or a counterpart of this Agreement by each of Agritope, ACTTAG, Inc.
and RP AG Co. Upon the later of such execution or the filing of the Certificate
of Formation of the Company (the "Certificate"), each of ACTTAG, Inc. and RP AG
Co. shall automatically be admitted as Members of the Company.
(c) The name and mailing address of each Member, the agreed
value of the amount contributed to the Company and the Percentage Interest of
each Member shall be as listed on Exhibit G attached hereto. The Board shall be
required to update Exhibit G from time to time as necessary to accurately
reflect the information therein. Any amendment or revision to Exhibit G made in
accordance with this Agreement shall not be deemed an amendment to this
Agreement. Any reference in this Agreement to Exhibit G shall be deemed to be a
reference to such Exhibit G as amended and in effect from time to time.
(d) ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, as an authorized person, within the
meaning of the Act, shall execute, deliver and file the Certificate with the
Secretary of State of the State of Delaware. Upon the filing of the Certificate
with the Secretary of State of the State of Delaware, his powers as an
authorized person shall cease and each Manager of the Company shall thereafter
be designated as an authorized person within the meaning of the Act.
2.4 TERM
The term of the Company shall commence upon the filing of the
Certificate with the Secretary of State of the State of Delaware and the term
shall continue until dissolved in accordance with Article 11. The existence of
the Company as a separate legal entity shall continue until the cancellation of
the Certificate as provided in the Act.
2.5 PURPOSE
2.5.1 GENERAL
The purpose of the Company is to conduct, coordinate and implement the
Research Program and the Marketing Program and to engage in such activities that
are necessary, desirable, advisable, convenient, incidental or appropriate to
the foregoing. The Company shall not engage in any other business or activity
without the written agreement of all Members.
2.5.2 ACTIVITIES
The Company shall provide, directly or through contracts with others,
the full range of services and products required to fulfill its purpose,
including, without limitation, the following:
(a) engaging RP Ag Co. under the RP Ag Co. Research Contract and
License Agreement to perform the research services, and to provide for the
AGRINOMICS LLC 11 Limited Liability Company Agreement
Company's benefit the facilities, personnel, capabilities, resources, patent
application assistance and management services, and rights therein described,
and the Company shall take all necessary and appropriate steps to cooperate with
RP Ag Co. with respect thereto and shall perform the Company's obligations under
the RP Ag Co. Research Contracts;
(b) engaging Agritope under the Agritope Research and Management
Contract to perform for the Company the management services and the research
services, and to provide for the Company's benefit the facilities, personnel,
capabilities, resources, patent application assistance, and rights therein
described, and the Company shall take all necessary and appropriate steps to
cooperate with Agritope with respect thereto and shall perform the Company's
obligations under the Agritope Research and Management Contract;
(c) contracting with one or more third parties to provide to the
Company other facilities, services (professional and otherwise), personnel,
capabilities, resources and rights as called for under the Operating Plan or as
otherwise recommended by the Company's CEO and approved by the Board (or as
shall be determined by the CEO in his or her discretion in those instances in
which such an acquisition does not exceed US$100,000 in value during any
calendar quarter and is, together with any related or contemporaneous
expenditure, consistent with the Company's Budget), but subject in any event to
the Agritope Research and Management Contract;
(d) contracting with the Member(s) and one or more Alliance Parties
with respect to the performance of specific research projects directed to genes
and crops of particular interest to the respective Alliance Parties and for the
grant of certain commercialization or other rights therein or otherwise with
respect to rights in the results of the Research Program within the scope of
such defined areas of interest on a subscription basis or otherwise, in return
for support, license fees, subscription fees, milestones, royalties,
cross-licenses, resources, facilities, and/or other considerations from the
Member(s) and such Alliance Parties as may be approved in each instance by the
Board on the recommendation of the CEO or his or her designee; provided,
however, that the Company will give first consideration to its Members and their
Affiliates, in preference to third parties, when seeking parties to any such
agreements, unless the circumstances clearly require otherwise or such
preference or first consideration would violate any agreement of the Company;
(e) contracting with one or more manufacturers, growers, packers,
processors, ▇▇▇▇▇, licensees, distributors, or other third parties (whether or
not they are also Alliance Parties) in connection with the testing,
certification, commercialization, marketing, sale, and other exploitation of the
Company's Property and rights derived from the Research Program consistent with
the Operating Plan or as otherwise approved by the Board; and
(f) conducting or causing to be conducted such other activities or
projects as may be consistent with the Operating Plan, or as may otherwise be
approved by the Board.
(g) The Company may enter into and perform those agreements listed in
Exhibit H without any further act, vote or approval of any Member, Manager, or
AGRINOMICS LLC 12 Limited Liability Company Agreement
other Person, notwithstanding any other provision of this Agreement, the Act or
other applicable law, rule or regulation.
2.5.3 ACTIVITIES OUTSIDE THE SCOPE OF THE COMPANY'S ACTIVITIES
The Members may engage in or possess an interest in other business
ventures of any nature or description, independently or with others, whether
presently existing or hereafter created, other than (a) for the purpose of
conducting the Research Program or any plant functional genomics program
involving the activation tagging of Arabidopsis plants using the technology
developed under ACTTAG TM Gene Discovery Program or (b) for the purpose of
conducting the Marketing Program or any commercial exploitation of Property or
rights derived from the Research Program or any plant functional genomics
program involving the activation tagging of Arabidopsis plants using the
technology developed under ACTTAGTM Gene Discovery Program.
2.6 TITLE TO COMPANY PROPERTY
All Property owned by the Company shall be the property of the Company
as an entity, and no Member, individually, shall have any ownership interest in
any such Property.
2.7 PUBLICITY
Neither the Company nor any Member may issue any public statement or
press release regarding the Company or its business without the prior consent of
all Members, except as required by law or an order from any competent
governmental authority (provided that in the event of any such required
disclosure, the disclosing Member or the Company shall give all Members advance
notice of such disclosure in accordance with Section 2.8(b)).
2.8 CONFIDENTIALITY
(a) Subject to the controlling effect of any contrary provisions in any
Research Contract, each Member and its Parent agrees: (i) to take all reasonable
precautions and to use its best efforts to maintain the confidentiality of all
Confidential Information (as defined below) that such Member and its Parent (the
"Recipient") obtains in respect to any other Member or the Company (the
"Disclosing Party"); and (ii) not to use or disclose such Confidential
Information to any third parties other than the Recipient's Affiliates that are
similarly bound to protect the same or otherwise with the written approval of
the Disclosing Party or as permitted by Section 2.8(b). For purposes of this
Section 2.8, "Confidential Information" means all proprietary or confidential
information owned or provided by a Disclosing Party other than information that
the Recipient or its Affiliate can prove (A) was previously known to the
Recipient or any of its Affiliates (other than from a Disclosing Party or an
Affiliate thereof), or (B) is available or, without the fault of the Recipient
or any of its Affiliates (other than the Company), becomes available to the
general public, or (C) is lawfully received by the Recipient from a third party
that, to the Recipient's knowledge, is not bound by any similar obligation of
confidentiality. The disclosure of Confidential Information shall not constitute
AGRINOMICS LLC 13 Limited Liability Company Agreement
any grant of license or any other rights nor generate any business arrangements
unless specifically set forth herein or in another agreement.
(b) A Recipient may disclose Confidential Information to appropriate
regulatory authorities, attorneys, accountants and pursuant to any order of a
court, administrative agency or other governmental authority and may take any
lawful action that it deems necessary to protect its interests or the interests
of its Affiliates under, or to enforce compliance with the terms and conditions
of, this Agreement; provided, HOWEVER, that in the event that it appears that a
Recipient may become legally compelled to disclose any Confidential Information,
it will promptly consult with the Disclosing Party as to the reasons for such
disclosure and will afford the Disclosing Party a reasonable opportunity to
obtain a protective order as to such information and will use reasonable efforts
to obtain reliable assurance that the information disclosed will be treated
confidentially.
2.9 FAILURE TO OBSERVE FORMALITIES
To the fullest extent permitted by law, a failure to observe any
formalities or requirements of this Agreement, the Certificate or the Act shall
not be grounds for imposing or otherwise adversely affecting personal liability
on the Members or Managers for liabilities of the Company or otherwise.
2.10 LIABILITY OF MEMBERS AND MANAGERS TO THIRD PARTIES
Except as otherwise provided in the Act, no Member or Manager shall be
personally liable for any debt, obligation or liability of the Company, whether
arising in contract, tort or otherwise, solely by reason of being a Member or
acting as a Manager of the Company.
ARTICLE 3
CAPITAL CONTRIBUTIONS; CONDITIONS PRECEDENT TO CLOSING
3.1 ACTTAG, INC.'S INITIAL CAPITAL CONTRIBUTIONS
(a) As its Initial Capital Contribution:
(i) ACTTAG, Inc. shall, pursuant to the Assignment and
Assumption Agreement, transfer to the Company all of ACTTAG, Inc.'s rights,
interests, and obligations in, to, and under the Salk ACTTAG Research Agreement
and the University of Edinburgh ACTTAG Research Agreement, as contributed to
ACTTAG, Inc. by Agritope; and
(ii) ACTTAG, Inc. shall transfer to the Company all ownership
and other rights and title, including, without limitation, all intellectual
property rights, in and to the Existing Agritope Collection, as contributed to
ACTTAG, Inc. by Agritope.
AGRINOMICS LLC 14 Limited Liability Company Agreement
3.2 RP AG CO.'S CAPITAL CONTRIBUTIONS
RP Ag Co.'s Capital Contribution shall consist of the following: (a) RP Ag Co.
shall pay the Company at Closing an Initial Capital Contribution of US$5,000,000
in cash or other readily available funds (representing sums anticipated to be
devoted to the Research Program over the four-quarter period from July 1, 1999
through June 30, 2000), and (b) RP Ag Co. hereby agrees to make Additional
Contributions pursuant to Section 3.6.
3.3 FAIR MARKET VALUE OF CONTRIBUTIONS
(a) The aggregate Gross Asset Value for ACTTAG, Inc.'s Initial Capital
Contributions is US$20,000,000.
(b) The aggregate Gross Asset Value for RP Ag Co.'s Capital
Contributions is US$20,000,000.
(c) While each Member or its Affiliate(s) will provide certain services
to the Company under one or more Research Contracts, each will be paid for such
services to the extent provided for in the applicable Research Contract. To the
extent such payment is not so provided for, each Member intends that it will not
be separately compensated for any services, technologies, rights or properties.
Except for Additional Capital Contributions to be made in cash by RP Ag Co.
under Section 3.6, neither Member shall receive any additional interest or share
of the capital of the Company, nor any credit to its Capital Account, for any
services, technologies, rights or properties that are provided or made available
to the Company by a Member or its Affiliates or that may be used for the
Company's purposes or to its benefit, whether or not the same are explicitly to
be paid for under or in connection with any Research Contract.
3.4 CLOSING
Subject to the satisfaction or waiver of the conditions precedent
stated herein, the closing hereunder (the "Closing") shall occur on the Closing
Date at such time and place as may be mutually agreed upon by the parties. At
the Closing, each party shall deliver such documents, instruments and materials
as are called for by this Agreement or as may be reasonably required in order to
carry out the provisions and purposes hereof.
3.5 CONDITIONS PRECEDENT TO THE CLOSING
All the obligations of any Member under this Agreement are subject to
the fulfillment, at or prior to the Closing Date, of each of the conditions set
forth below in this Section. Each Member shall use best efforts to procure that
all such conditions are fulfilled at or prior to the Closing Date, provided,
however that neither Member nor its Parent will prior to the Closing Date modify
or amend any of the third-party agreements described in the following conditions
to which such Member or its Parent is a party, or will waive any of its rights
AGRINOMICS LLC 15 Limited Liability Company Agreement
relating thereto, without the prior written consent of the other Member, which
consent shall not be unreasonably withheld.
(a) Each Member will have completed its due diligence and business
review and such review shall have been satisfactory to such Member in its sole
discretion.
(b) Neither Member shall have discovered any material error,
misstatement or omission in the representations and warranties made by the other
party in Article 8, it being agreed that either Member may require at Closing
that it receive one or more written certifications and reaffirmations of such
representations and warranties made by the other party.
(c) Subject to waiver of this condition in whole or in part by the
other Member, each Member shall have performed and complied with all terms,
covenants and conditions required by this Agreement prior to the Closing Date.
(d) No suit, action or proceeding against any Member shall be pending
or threatened before any court or governmental agency in which such suit, action
or proceeding seeks to restrain or prohibit or to obtain damages or other relief
in connection with this Agreement or the transactions contemplated hereby.
(e) Subject to waiver of this condition in whole or in part by the
other Member, each Member shall have delivered to the other Member such other
instruments and documents as may be reasonably necessary to effectuate the
transactions contemplated by this Agreement.
(f) All necessary notifications and filings, including the filing of
the Certificate with the Secretary of State of the State of Delaware, required
to be made in or with respect to any relevant country will have been made and
all necessary governmental approvals, if any, shall have been received and the
prescribed waiting periods will have expired or been terminated. No governmental
entity shall have indicated its objection to, or its intent to challenge as
violative of any federal, state or foreign laws, any of the transactions
contemplated by this Agreement or any related documents. In the event a
governmental entity places a condition on its approval of the transaction as
contemplated by this Agreement or any related documents that has a material
effect on the proposed business of the Company, the Members shall attempt to
negotiate a mutually agreeable modification to this Agreement.
(g) Agritope and the Company shall have entered into, and duly executed
and delivered, the Agritope Research and Management Contract.
(h) The transfer to ACTTAG, Inc. of Agritope's rights, interests, and
obligations in, to, and under the Salk ACTTAG Research Agreement and the
University of Edinburgh ACTTAG Research Agreement and the Existing Agritope
Collection shall have validly taken place, with no adverse effects on any of
these rights, interests and obligations by reason of such transfer, and RP Ag
AGRINOMICS LLC 16 Limited Liability Company Agreement
Co. shall have received evidence to its satisfaction of such valid transfer
without any adverse effects.
(i) ACTTAG, Inc. and the Company shall have entered into, and duly
executed and delivered, the Assignment and Assumption Agreement and RP Ag Co.
shall have received evidence to its satisfaction that such Agreement has validly
been entered into with no adverse effect on any rights, interests and
obligations in, to and under the contracts and other assets, including without
limitation the Salk ACTTAG Research Agreement and the University of Edinburgh
ACTTAG Research Agreement and the Existing Agritope Collection.
(j) Subject to waiver of this condition in whole or in part by ACTTAG,
Inc., RP Ag Co. and the Company shall have entered into, and duly executed and
delivered, the RP Ag Co. Research Contract and License Agreement.
(k) Subject to waiver of this condition in whole or in part by ACTTAG,
Inc., RP Ag Co. shall have paid to the Company, in readily available funds, RP
Ag Co.'s Initial Capital Contribution, designated in Section 3.2.
3.6 ADDITIONAL CAPITAL CONTRIBUTIONS
In addition to its Initial Capital Contribution pursuant to Section
3.2, RP Ag Co. or its transferee pursuant to Section 10 shall make additional
contributions (the "Additional Capital Contributions") to the capital of the
Company as follows:
(a) RP Ag Co. agrees to pay the Company Additional Capital
Contributions in cash or other readily available funds as follows :
- payable on the first day of July 2000, the sum of $US5,000,000;
- payable on the first day of July 2001, the sum of $US4,000,000;
- payable on the first days of July 2002 and July 2003, the sum
of $US3,000,000 on each such day.
(b) Upon any dissolution of the Company, and subject to the provisions
of Section 12.1, RP Ag Co. shall make an Additional Capital Contribution equal
to the amount, if any, by which the total of the cash contributed by RP Ag Co.
at Closing plus the sums contributed by RP Ag Co. under Section 3.6(a) is less
than US$20,000,000.
3.7 NO BENEFIT TO CREDITORS
The provisions of this Agreement, including Article 3, are intended to
benefit the Members and, to the fullest extent permitted by law, shall not be
construed as conferring any benefit upon any creditor of the Company (and no
such creditor of the Company shall be a third-party beneficiary of this
Agreement) and the Members shall not have any duty or obligation to any creditor
AGRINOMICS LLC 17 Limited Liability Company Agreement
of the Company to make any contribution to the Company or to issue any call for
capital pursuant to this Agreement.
3.8 NO WITHDRAWAL OF CAPITAL; NO INTEREST ON CAPITAL
Except as specifically provided in this Agreement, no Member shall have
the right to withdraw all or any part of its Capital Contribution from the
Company, nor shall any Member have any right to demand and receive Property or
cash of the Company as a return of its Capital Contribution. No Member shall
have the right to receive interest on its Capital Contribution or its Capital
Account.
3.9 MAINTENANCE OF CAPITAL ACCOUNTS
A Capital Account shall be established and maintained for each Member
in accordance with Section 1.704-1(b) of the Treasury Regulations or any
successor provisions:
(a) Upon the Transfer of all or part of an interest in the Company, the
Capital Account of the transferor that is attributable to the transferred
interest in the Company shall carry over to the transferee Member in accordance
with the provisions of Regulations Section 1.704-1(b)(2)(iv)(L), except as
otherwise required to satisfy Regulations Section 1.704-1(b) in connection with
a termination of the Company under Code Section 708(b)(1)(B).
(b) In determining the amount of any liability for purposes of
maintaining Capital Accounts for the Members, there shall be taken into account
Code Section 752(c) and any other applicable provisions of the Code and the
Regulations.
In the event the Board shall determine that it is prudent to modify the manner
in which the Capital Accounts, or any debits or credits thereto (including,
without limitation, debits or credits relating to liabilities that are secured
by contributed or distributed property or that are assumed by the Company or the
Members), are computed in order to comply with the Code and the Regulations, the
Board may make such modification consistent with the principles of Regulation
Section 1.704-1(b)(2)(Q).
3.10 ADDITIONAL MEMBERS
The Company may, with Board approval, admit additional Persons as
Members in the Company having such rights, obligations and an Interest as agreed
upon by the Board and the newly-admitted Member. The additional Member shall
make a Capital Contribution to the Company in an amount and pursuant to such
terms as agreed upon by the Board and the newly-admitted Member. The Company
shall revalue the Gross Asset Value of the Company assets to the extent that the
Board, established by Board approval, considers it necessary to preserve the
economic interests of the Members. This Agreement shall be amended to the extent
necessary to reflect the admission of the additional Member and such Member's
agreement to be bound by the terms reflected herein.
AGRINOMICS LLC 17 Limited Liability Company Agreement
ARTICLE 4
ALLOCATIONS
4.1 ALLOCATION OF PROFITS AND LOSSES
After giving effect to the special allocations set forth in Section
4.2, Profits and Losses for any Fiscal Year shall be allocated among the Members
in proportion to their respective Percentage Interests.
4.2 SPECIAL ALLOCATIONS
The following special allocations shall be made in the following order
and priority:
4.2.1 MINIMUM GAIN CHARGEBACK
Except as otherwise provided in Regulations Section 1.704-2(f),
notwithstanding any other provision of this Article 4, if there is a net
decrease in Company Minimum Gain during any Fiscal Year, each Member shall be
specially allocated items of Company income and gain for such Fiscal Year (and
if necessary subsequent Fiscal Years) in an amount equal to such Member's share
of the net decrease in Company Minimum Gain, determined in accordance with
Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence
shall be made in proportion to the respective amounts required to be allocated
to each Member pursuant thereto. The items to be so allocated shall be
determined in accordance with Regulations Sections 1.704-2(f)(6) and
1.704-2(j)(2). This Section 4.2.1 is intended to comply with the minimum gain
chargeback requirement in Regulations Section 1.704-2(f) and shall be
interpreted consistently therewith.
4.2.2 MEMBER MINIMUM GAIN CHARGEBACK
Except as otherwise provided in Regulations Section 1.704-2(i)(4),
notwithstanding any other provision of this Article 4, if there is a net
decrease in Member Nonrecourse Debt Minimum Gain attributable to a Member
Nonrecourse Debt during any Fiscal Year, each Member who has a share of the
Member Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse
Debt, determined in accordance with Regulations Section 1.704-2(i)(5), shall be
specially allocated items of Company income and gain for such Fiscal Year (and,
if necessary, subsequent Fiscal Years) in an amount equal to such Member's share
of the net decrease in Member Nonrecourse Debt Minimum Gain attributable to such
Member Nonrecourse Debt, determined in accordance with Regulations Section
1.704-2(i)(4). Allocations pursuant to the previous sentence shall be made in
proportion to the respective amounts required to be allocated to each Member
pursuant thereto. The items to be so allocated shall be determined in accordance
with Regulations Sections 1.704-2(i)(4) and 1.704-2(j)(2). This Section 4.2.2 is
intended to comply with the minimum gain chargeback requirement in Regulations
Section 1.704-2(i)(4) and shall be interpreted consistently therewith.
AGRINOMICS LLC 19 Limited Liability Company Agreement
4.2.3 QUALIFIED INCOME OFFSET
In the event any Member unexpectedly receives any adjustments,
allocations or distributions described in Regulations Section
1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of Company income and gain shall be
specially allocated to each such Member in an amount and manner sufficient to
eliminate, to the extent required by the Regulations, the Adjusted Deficit of
such Member as quickly as possible, provided that an allocation pursuant to this
Section 4.2.3 shall be made only if and to the extent that such Member would
have an Adjusted Deficit after all other allocations provided for in Article 4
have been tentatively made as if this Section 4.2.3 were not in this Agreement.
4.2.4 NONRECOURSE DEDUCTIONS
Nonrecourse Deductions for any Fiscal Year shall be specially allocated
among the Members in proportion to their Percentage Interests.
4.2.5 MEMBER NONRECOURSE DEDUCTIONS
Any Member Nonrecourse Deductions for any Fiscal Year shall be
specially allocated to the Member who bears the economic risk of loss with
respect to the Nonrecourse Debt to which such Member Nonrecourse Deductions are
attributable in accordance with Regulations Section 1.704-2(i)(1).
4.2.6 CODE SECTION 754 ADJUSTMENTS
To the extent an adjustment to the adjusted tax basis of any Company
asset pursuant to Code Section 734(b) or Code Sections 743(b) is required
pursuant to Regulations Section 1.704-1(b)(2)(iv)(M)(2) or Section
1.704-1(b)(2)(iv)(M)(4) to be taken into account in determining Capital Accounts
as a result of a distribution to a Member in complete liquidation of its
Interest, the amount of such adjustment to Capital Accounts shall be treated as
an item of gain (if the adjustment increases the basis of the asset) or loss (if
the adjustment decreases the basis of the asset) and such gain or loss shall be
specially allocated to the Members in accordance with their interests in the
Company in the event Regulations Section 1.704-1(b)(2)(iv)(M)(2) applies, or to
the Member to whom such distribution was made in the event Regulations Section
1.704-1(b)(2)(iv)(M)(4) applies.
4.3 CORRECTIVE ALLOCATIONS
The allocations set forth in Sections 4.2.1, 4.2.2, 4.2.4, and 4.2.5
(the "Regulatory Allocations") are intended to comply with Regulations Sections
1.704-1 and 1.704-2. It is the intent of the Members that, to the extent
possible, all Regulatory Allocations shall be offset either with other
Regulatory Allocations or with special allocations of items of Company income,
gain, loss or deduction pursuant to this Section 4.3. Therefore, notwithstanding
any other provisions of this Article 4 (other than the Regulatory Allocations),
the Board shall make such offsetting special allocations of Company income,
AGRINOMICS LLC 20 Limited Liability Company Agreement
gain, loss or deduction in whatever manner it determines appropriate so that,
after such offsetting allocations are made, each Member's Capital Account
balance is, to the extent possible, equal to the Capital Account balance such
Member would have had if the Regulatory Allocations were not part of this
Agreement and all Company items were allocated pursuant to Section 4.1. In
exercising its discretion under this Section 4.3, the Board shall take into
account future Regulatory Allocations under Sections 4.2.1 and 4.2.2 that,
although not yet made, are likely to offset other Regulatory Allocations
previously made under Sections 4.2.4 and 4.2.5.
4.4 CODE SECTION 704(C) ALLOCATIONS
In accordance with Code Section 704(c) and the Regulations thereunder,
income, gain, loss and deduction with respect to any property contributed to the
capital of the Company shall be allocated among the Members, solely for federal
income tax purposes, so as to take account of any variation between the adjusted
basis of the property to the Company for federal income tax purposes and its
initial Gross Asset Value (computed in accordance with this Agreement). The
manner in which such types of income, gain, loss and deduction are allocated
shall be made in a manner consistent with the traditional method of making Code
Section 704(c) allocations as provided in Regulations Section 1.704-3(b).
In the event the Gross Asset Value of any Company asset is adjusted
pursuant to the terms of this Agreement, subsequent allocations of income, gain,
loss and deduction with respect to such asset shall take into account any
variation between the adjusted basis of such asset for federal income tax
purposes and its Gross Asset Value in a manner consistent with the traditional
method of making Code Section 704(c) allocations as provided in Regulations
Section 1.704-3(b).
4.5 OTHER ALLOCATION RULES
(a) For purposes of determining the Profits, Losses or any other items
allocable to any period, Profits, Losses and any such other items shall be
determined on a daily, monthly or other basis, as determined by the Board using
any permissible method under Code Section 706 and the Regulations thereunder.
(b) Except as otherwise provided in Section 4.4 with respect to
allocations pursuant to Code Section 704(c), for federal income tax purposes,
all items of Company income, gain, loss or deduction shall be made in a manner
that is consistent with the allocation of Profits and Losses pursuant to this
Article 4. The Members are aware of the income tax consequences of the
allocations of this Article 4 and hereby agree to be bound by the provisions of
this Article 4 in reporting their allocable shares of Company income and loss
for income tax purposes.
AGRINOMICS LLC 21 Limited Liability Company Agreement
ARTICLE 5
DISTRIBUTIONS OF NET CASH FLOW AND DISTRIBUTIONS IN LIQUIDATION
5.1 TIMING OF DISTRIBUTIONS
Net Cash Flow for each Fiscal Year shall be distributed to the Members
in accordance with the priorities in Section 5.2 at such times and in such
amounts (if any) as determined by the Board in its sole discretion; provided,
however, that:
(a) No distribution shall be made if it would render the Company
insolvent or compromise its
ability to operate;
(b) The Board shall not authorize the distribution of any Property in
kind except upon dissolution or liquidation of the Company; and
(c) Subject to (a) and (b) above in this section, amounts equal to the
effective federal, state and local income taxes (based on the highest applicable
rates in the applicable year) that would be payable by a corporation recognizing
the taxable income allocated to each of the Members shall be timely distributed
to each Member prior to the due date for the payment of such taxes, unless both
Members waive all or part of such distribution in any one or more years.
5.2 PRIORITY OF DISTRIBUTIONS
Net Cash Flow shall be distributed between the Members in proportion to
their respective Percentage Interests.
5.3 DISTRIBUTIONS IN LIQUIDATION
(a) Upon dissolution of the Company and the liquidation of the assets
of the Company pursuant to Article 11, the Liquidating Agent shall wind up the
affairs of the Company and liquidate the assets as promptly as is consistent
with obtaining fair value therefor and cause the remaining assets of the
Company, including proceeds of sales or other dispositions in liquidation of
assets, to be applied in accordance with the following priorities:
(i) First, to payment of the debts and obligations of the
Company to its creditors (other than a Member), including sales commissions and
other expenses incident to any sale of the assets of the Company, including the
establishment of such reserves as the Liquidating Agent may deem reasonably
necessary for any unliquidated contingent, conditional or unmatured liabilities
or obligations of the Company;
(iii) Second, to the payment in full of loans (including for
this purpose, accrued interest thereon through the date of payment) to the
Company by the Members, pro rata, according to the relative amount of such
unpaid loans (including for this purpose, accrued interest thereon through the
date of payment); and
AGRINOMICS LLC 22 Limited Liability Company Agreement
(iv) Third, to the Members having positive Capital Accounts
pro rata in accordance with their relative positive Capital Accounts (as
determined after taking into account all Capital Account adjustments for the
Company's Fiscal Year during which such liquidation occurs), until all such
positive Capital Accounts are reduced to zero.
(v) Fourth, remaining assets, if any, among the Members in
proportion to their respective Percentage Interests.
The reserves established pursuant to clause (i) of this Section 5.3(a) shall be
paid over by the Liquidating Agent to a bank or other financial institution to
be held in escrow for the purpose of paying unliquidated, contingent,
conditional or unmatured liabilities or obligations and, at the expiration of
such period as the Liquidating Agent deems advisable, such reserves shall be
distributed to the Members or their assigns in the priority set forth in clauses
(iii) and (iv) of this Section 5.3(a). Distributions to the Members pursuant to
this Section 5.3(a) shall be made within the time period prescribed by
Regulations Section l.704-l(b)(2)(ii)(B).
(b) In the event the Liquidating Agent determines that an immediate
sale of part or all of the Company assets would cause undue loss to the Members,
the Liquidating Agent, in order to avoid such loss, may either (i) defer
liquidation of any assets of the Company for a reasonable time, except those
assets necessary to satisfy Company debts and obligations, or (ii) distribute
the assets in kind to the Members. In winding up the Company's affairs, every
effort shall be made to dispose of the assets of the Company in an orderly
manner, having regard to the liquidity, divisibility and marketability of the
Company's assets and consistent with the considerations set forth in this
Section 5.3. If the Liquidating Agent determines that it would be imprudent to
dispose of any non-cash assets of the Company, such assets may be distributed in
kind to the Members, in lieu of cash, proportionately to their rights to receive
cash distributions hereunder; provided, that the Liquidating Agent shall in its
sole discretion determine the relative share of the Members of each kind of
those assets that are to be distributed in kind. In addition, in connection with
the winding up of the Company, each of the Members shall be entitled to make an
offer to acquire the assets of the Company and such offer may be accepted by the
Liquidating Agent on behalf of the Company if such offer is consistent with
obtaining fair value for the assets of the Company. If any assets of the Company
are to be distributed in kind, such assets shall be valued and shall be deemed
sold at their fair market value and any gain or loss deemed realized shall be
allocated to the Capital Accounts of the Members for purposes of applying this
Section 5.3 as if such gain or loss had actually been fully realized. For U.S.
federal income tax purposes, the tax consequences of any in-kind distribution
during the life of or on liquidation of the Company pursuant to this Section 5.3
or otherwise shall be governed by Sections 732(a) and (b) of the Code and the
Regulations promulgated thereunder.
5.4 DEFICIT CAPITAL ACCOUNTS
Except as may otherwise be required by law or any other agreement to
the contrary, notwithstanding anything to the contrary contained in this
AGRINOMICS LLC 23 Limited Liability Company Agreement
Agreement, to the extent that any Member has a deficit Capital Account balance
upon dissolution of the Company, that deficit shall not be an asset of the
Company and that Member shall not be obligated to contribute that amount to the
Company to bring the balance of that Member's Capital Account to zero.
5.5 WAIVER OF PARTITION
No Member, either directly or indirectly, shall take any action to
require partition of the Company or any of its assets or properties.
Notwithstanding any provisions of applicable law to the contrary, each Member
(and its successors and assigns) hereby irrevocably waives any and all right to
maintain any action for partition or to compel any sale with respect to its
Company Interest, or with respect to any assets or properties of the Company,
except as expressly provided in this Agreement.
ARTICLE 6
MANAGEMENT AND OPERATION
6.1 THE BOARD OF MANAGERS
6.1.1 CONSTITUTION AND POWERS OF THE BOARD
The overall management and control of the Company shall be governed by
a Board of Managers composed of four Managers (the "Managers"). Except as
otherwise provided in Section 10.5, each Member shall appoint two Managers.
ACTTAG, Inc. hereby appoints ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ as its
initial Managers. RP Ag Co. hereby appoints Georges Freyssinet and ▇▇▇▇▇ ▇▇▇▇ as
its initial Managers. The Members may appoint alternates to serve as temporary
replacements for their respective Managers. The alternates shall have all the
powers of the Managers in the temporary absence or inability of the Managers to
attend or serve. Except as approved by the Board or permitted by this Agreement,
and notwithstanding the last sentence of Section 18-402 of the Act, neither
Member shall have any right or authority to bind the Company or take any action
on behalf of the Company. Each Member may remove its designated Manager(s) from
the Board at any time, with or without cause. Except as provided for in this
Agreement, and notwithstanding the last sentence of Section 18-402 of the Act, a
Manager may not bind the Company.
6.1.2 MEETINGS OF THE BOARD
The Board shall meet at least once every quarter. In addition, the
Board shall meet upon the request of any Manager made to the Company's CEO.
Managers may participate in meetings in person or by telephone. Meetings shall
be held at such place and time as agreed to by the Board. The CEO shall provide
at least ten business days' advance written notice of each meeting of the Board
to each Manager, unless a Manager not receiving advance notice waives the
advance notice requirement, either in writing or by attendance at the meeting
without entering into the minutes of the meeting a protest as to the lack of
notice, and provided further that notice given to one Manager appointed by a
Member shall constitute notice to both Managers appointed by that Member. A
AGRINOMICS LLC 24 Limited Liability Company Agreement
minimum quorum of Managers entitled to conduct the business of the Board shall
consist of at least two Managers, at least one of whom must have been appointed
by each Member. Records of proceedings of the Board shall be prepared by the CEO
or his or her designee and shall be subject to the approval of the Board.
6.1.3 VOTING
Each Member shall be entitled to two Board votes, which may be
allocated in any manner among the Member's Managers. One or more Managers of a
Member attending a Board meeting or taking any action contemplated by the last
sentence of this Section 6.1.3 shall be entitled to vote all two Board votes of
a Member. The Board shall act upon the unanimous vote of all Managers attending
a duly convened meeting of the Board and entitled to vote on the matter under
consideration in accordance with Section 6.1.2, and such vote shall constitute
"approval" or proper "action" or the "decision" of the Board. The Board also may
take any action permitted to be taken at a meeting of the Board by written
consent joined in by all the Managers or by Managers authorized to vote all four
of the total votes.
6.2 MATTERS REQUIRING BOARD APPROVAL
All decisions and actions for and on behalf of the Company shall
require approval by the Board, except those matters delegated to the CEO or
another executive of the Company pursuant to this Agreement, the Operating Plan,
or otherwise directed or delegated by Board resolution.
6.3 DAY-TO-DAY MANAGEMENT BY CEO
The initial Chief Executive Officer of the Company (the "CEO") shall be
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, the Chief Executive Officer of ACTTAG, Inc. Subject to the
restrictions set forth in this Agreement and to the direction of the Board, the
CEO shall act on behalf of the Company in all matters affecting day-to-day
management and supervision of the Company and its business affairs, shall
implement the Budget and the Operating Plan and shall cause the Company to
fulfill all of its contractual obligations. All matters of policy relating to
the Company and its business affairs shall be determined by the Board for
implementation by the CEO, and the CEO shall have no authority to make such
policy determinations. The CEO is authorized and empowered to implement and act
in accordance with resolutions adopted by the Board. The CEO shall be appointed
by the Board from among the Managers to a one-year term of office; provided,
however that the Board may remove the CEO and appoint a replacement CEO from
among the Managers at any time for any or no reason.
6.4 SCIENTIFIC MANAGEMENT COMMITTEE AND SCIENTIFIC ADVISORY COMMITTEE
6.4.1 SCIENTIFIC MANAGEMENT COMMITTEE
The Board shall establish a "Scientific Management Committee" to advise
the Board on scientific and research issues, techniques, problem solving and
AGRINOMICS LLC 25 Limited Liability Company Agreement
goals, all as relevant to the Research Program. The Board shall define the goals
and tasks of the Scientific Management Committee and establish rules for
compensation (if any), expense reimbursement, and proprietary rights with
respect to the members thereof. Members of the Scientific Management Committee
will serve at the pleasure of the Board. The initial members of the Scientific
Management Committee will be ▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ (nominated by
ACTTAG, Inc.) and ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ (nominated by RP Ag Co.). The
initial chair of the Scientific Management Committee is ▇▇ ▇▇▇▇▇▇, who is
appointed to a one-year term of office; provided, however that the Board may
remove the chair of the Scientific Management Committee and appoint a
replacement at any time for any or no reason. Members of the Board will receive
notice of, and an invitation to attend, all meetings of the Scientific
Management Committee.
6.4.2 SCIENTIFIC ADVISORY COMMITTEE
The Board shall establish a "Scientific Advisory Committee" to render
non-binding advice to the Company on scientific and research issues, techniques,
problem solving and goals, all as relevant to the Research Program. The Board
shall define the goals and tasks of the Scientific Advisory Committee and
establish rules for compensation (if any), expense reimbursement, and
proprietary rights with respect to the members thereof. Members of the
Scientific Advisory Committee will serve at the pleasure of the Board. The
Scientific Advisory Committee will consist of the members of the Scientific
Management Committee, together, initially, with ▇▇▇▇▇ ▇▇▇▇▇▇ from Texas A&M,
▇▇▇▇▇▇ ▇▇▇▇▇▇ from Salk, and additional members, including if appropriate
scientific personnel from the University of Edinburgh, and one or more other
Alliance Parties, may be invited to join the Scientific Advisory Committee as
may be recommended from time to time by the Scientific Management Committee,
with the approval of the Board. The initial chair of the Scientific Advisory
Committee is ▇▇▇▇▇ ▇▇▇▇▇▇, who is appointed to a one-year term of office;
provided, however that the Board may remove the chair of the Scientific Advisory
Committee and appoint a replacement at any time for any or no reason. Members of
the Board will receive notice of, and an invitation to attend, all meetings of
the Scientific Advisory Committee.
6.5 PATENT COMMITTEE
The Board shall establish a "Patent Committee" to consult periodically
and as needed in relation to the Company's patent strategies filings,
prosecution and maintenance activities. The Patent Committee will consist of one
representative of each Member from the Board and one representative of each
Member from the Scientific Management Committee, as well as representatives from
the Members' patent departments or counsel, as shall be designated from time to
time by the Board. The Board shall establish rules for compensation (if any),
expense reimbursement, and proprietary rights with respect to the members of the
Patent Committee. Members of the Patent Committee will serve thereon at the
pleasure of the Board.
AGRINOMICS LLC 26 Limited Liability Company Agreement
6.6 OTHER OFFICERS AND COMMITTEES
The Board may, but is not required to, establish officers of the
Company and prescribe the duties of such officers. The officers of the Company
shall be chosen by, and shall serve at the pleasure of, the Board, and shall
hold their respective offices until their resignation, removal, or other
disqualification from service in a manner determined by the Board, or until
their respective successors shall be elected. The Board may, but is not required
to, establish such other teams or committees composed of representatives from
the Members or otherwise and delegate to such teams or committees such
authority, duties and responsibilities as it deems appropriate. Except as
otherwise provided herein, the officers shall have such powers and duties in the
management of the Company as may be prescribed in a resolution by the Board and,
to the extent not so provided, as generally pertain to their respective offices
as if the Company were a corporation governed by the General Corporation Law of
the State of Delaware, subject to the control of the Board. The Board may
require any officer, agent or employee to give security for the faithful
performance of his or her duties. Each officer shall hold office until his or
her successor is elected and qualified or until his or her earlier resignation
or removal. Any officer may resign at any time upon written notice to the
Company. The Board may remove any officer with or without cause at any time. Any
number of offices may be held by the same person. Any vacancy occurring in an
office of the Company by death, resignation, removal or otherwise may be filled
for the unexpired portion of the term by the Board at any regular or special
meeting of the Board.
6.7 DEVOTION OF TIME
Neither the CEO nor any other Manager is obligated to devote all of his
or her time or business efforts to the affairs of the Company. The CEO and each
of the other Managers shall devote whatever time, effort and skill as he or she
deems appropriate for the operation of the Company.
6.8 PERFORMANCE OF DUTIES
Each Manager including the CEO shall perform his or her managerial
duties in good faith, in a manner he or she reasonably believes to be in the
best interests of the Company and its Members, and with such care, including
reasonable inquiry, as an ordinarily prudent person in a like position would use
under similar circumstances. In performing his or her duties, the Managers shall
be entitled to rely on information, opinions, reports, or statements, including
financial statements and other financial data, of the following persons or
groups, unless they have knowledge concerning the matter in question that would
cause such reliance to be unwarranted and provided that the Manager acts in good
faith and after reasonable inquiry when the need therefor is indicated by the
circumstances:
(a) one or more officers, employees or other agents of the Company or a
Member whom the Manager reasonably believes to be reliable and competent in the
matters presented; or
AGRINOMICS LLC 27 Limited Liability Company Agreement
(b) any attorney, independent accountant or other person as to matters
that the Manager reasonably believes to be within such person's professional or
expert competence.
6.9 BUDGETS AND OPERATING PLANS
6.9.1 ADOPTION
On or before August 1 of each year, the Board shall consider and adopt
(a) a written budget setting forth in reasonable detail the anticipated receipts
and expenditures of the Company for the coming Fiscal Year, and the amount and
kind of expenditures (if any) in addition to those anticipated that may be made
on behalf of the Company without further action by the Board, and (b) a
five-year Operating Plan setting forth in detail the planned activities and
objectives for the Company for the coming Fiscal Year and the following four
years. The initial drafts of each Budget and Operating Plan shall be prepared by
the CEO and submitted to the Board a reasonable time prior the Board meeting at
which it is to be considered.
6.9.2 IMPLEMENTATION
Subject to Section 6.2: (a) the Budget and the Operating Plan shall be
implemented by the CEO; and (b) the CEO, on behalf of the Company, shall be
authorized to make the expenditures and incur the obligations provided for in
the Budget and shall be authorized to engage in the activities set forth in the
Operating Plan.
6.10 REPORTING
Within 45 days after the end of each calendar quarter and within 60
days after the end of each year, the CEO shall prepare and submit to the Board a
report describing in reasonable detail the operations and financial results of
the Company for such period and presenting a comparison of such operations and
financial results with the Budget and the Operating Plan for such period and
year-to-date, including a discussion of significant departures from the Budget
or from the objectives in the Operating Plan. The CEO shall further prepare and
submit to the Board such other periodic reports as the Board may request from
time to time. The CEO shall promptly notify the Board of any material
information concerning new or significant developments with respect to the
Company's business or operations and, upon the request of any Manager, shall
promptly submit to the Board such other information as may be requested.
6.11 INDEPENDENT ENTERPRISE
The Members agree to cause the Company at all times to be conducted as
an independent enterprise for profit. Except as otherwise agreed to by the
Members in writing or provided herein, all commercial transactions between the
Company and a Member (or a Member's Affiliate) shall be conducted on an
arm's-length basis with neither granting to the other terms or conditions more
AGRINOMICS LLC 28 Limited Liability Company Agreement
favorable than would be accorded unrelated third parties, except as the Members
may otherwise agree in writing prior to such transactions.
6.12 DUTIES OF MEMBERS
Each Member, in connection with the business and affairs of the
Company, and in exercising such Member's discretion under this Agreement, shall
to the fullest extent permitted by Section 18-1101(c) of the Act, be entitled to
consider such interests and factors as such Member desires, including its own
interest and the interest of its Affiliates, and shall have no duty or
obligation to give any consideration to any interest of, or factors affecting,
the Company or any other Member.
6.13 FIDUCIARY DUTIES OF MANAGER
To the fullest extent permitted by law, including Section 18-1101(c) of
the Act, each Manager shall be deemed an agent of the Member that designated
such Manager and shall have no duty (fiduciary or otherwise) to the Company or
to any other Member. Each Member, by execution of this Agreement, agrees to,
consents to, and acknowledges the delegation of powers and authority to the
Managers, and to actions and decisions of the Managers within the scope of the
Managers' authority as provided herein.
ARTICLE 7
LIABILITY, EXCULPATION AND INDEMNIFICATION
7.1 COMPENSATION OF MEMBERS
Except as may be specifically provided in this Agreement, the Agritope
Research Contracts, the RP Ag Co. Research Contracts, or in any other written
agreement binding on the Company, no Member shall receive any salary, fee or
draw for services rendered to or on behalf of the Company.
7.2 LIABILITY
Except as otherwise provided by the Act, 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, and no
Covered Person shall be obligated personally for any such debt, obligation or
liability of the Company solely by reason of being a Covered Person. "Covered
Person" means any Member, any Affiliate of a Member, or any Manager, or any
officers, directors, shareholders, partners, employees, representatives or
agents of a Member or their respective Affiliates, or any employee or agent of
the Company or its Affiliates.
7.3 EXCULPATION
(a) No Covered Person shall be liable to the Company or any other
Covered Person for any loss, damage or claim incurred by reason of any act or
AGRINOMICS LLC 29 Limited Liability Company Agreement
omission performed or omitted by such Covered 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 Covered Person by this Agreement, except that a
Covered Person shall be liable for any such loss, damage or claim incurred by
reason of such Covered Person's gross negligence or willful misconduct.
(b) A Covered Person shall be fully protected in relying in good faith
upon the records of the Company and upon such information, opinions, reports or
statements presented to the Company by any Person as to matters the Covered
Person reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Company, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which distributions to
Members might properly be paid.
7.4 DUTIES AND LIABILITIES OF COVERED PERSONS
(a) To the extent that, at law or in equity, a Covered Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Company or to any other Covered Person, a Covered Person acting under this
Agreement shall not be liable to the Company or to any other Covered Person for
its good faith reliance on the provisions of this Agreement. The provisions of
this Agreement, to the extent that they restrict the duties and liabilities of a
Covered Person otherwise existing at law or in equity, are agreed by the parties
hereto to replace such other duties and liabilities of such Covered Person.
(b) Unless otherwise expressly provided herein, (i) whenever a conflict
of interest exists or arises between Covered Persons, or (ii) whenever this
Agreement or any other agreement contemplated herein or therein provides that a
Covered Person shall act in a manner that is, or provides terms that are, fair
and reasonable to the Company or any Member, the Covered Person shall resolve
such conflict of interest, taking such action or providing such terms,
considering in each case the relative interest of each party (including its own
interest) to such conflict, agreement, transaction or situation and the benefits
and burdens relating to such interests, any customary or accepted industry
practices, and any applicable generally accepted accounting practices or
principles. In the absence of bad faith by the Covered Person, the resolution,
action or term so made, taken or provided by the Covered Person shall not
constitute a breach of this Agreement or any other agreement contemplated herein
or of any duty or obligation of the Covered Person at law or in equity or
otherwise.
(c) Whenever in this Agreement a Covered Person is permitted or
required to make a decision (i) in its "discretion" or under a grant of similar
authority or latitude, the Covered Person shall be entitled to consider such
interests and factors as it desires, including its own interests, and shall have
no duty or obligation to give any consideration to any interest of or factors
affecting the Company or any other Person, or (ii) in its "good faith" or under
another express standard, the Covered Person shall act under such express
AGRINOMICS LLC 30 Limited Liability Company Agreement
standard and shall not be subject to any other or different standard imposed by
this Agreement or other applicable law.
7.5 INDEMNIFICATION
To the fullest extent permitted by applicable law, a Covered Person
shall be entitled to indemnification from the Company for any loss, damage or
claim incurred by such Covered Person by reason of any act or omission performed
or omitted by such Covered 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 Covered Person by this Agreement, except that no Covered Person shall be
entitled to be indemnified in respect of any loss, damage or claim incurred by
such Covered Person by reason of gross negligence or willful misconduct with
respect to such acts or omissions; provided, however, that any indemnity under
this Section 7.5 shall be provided out of and to the extent of Company assets
only, and no Covered Person shall have any personal liability on account
thereof.
7.6 EXPENSES
To the fullest extent permitted by applicable law, expenses (including
legal fees) incurred by a Covered Person in defending any claim, demand, action,
suit or proceeding shall, from time to time, be advanced by the Company prior to
the final disposition of such claim, demand, action, suit or proceeding upon
receipt by the Company of an undertaking by or on behalf of the Covered Person
to repay such amount if it shall be determined that the Covered Person is not
entitled to be indemnified as authorized in Section 7.5.
7.7 INSURANCE
The Company may purchase and maintain insurance, to the extent and in
such amounts as the Board shall, in its sole discretion, deem reasonable, on
behalf of Covered Persons and such other Persons as the Board shall determine,
against any liability that may be asserted against or expenses that may be
incurred by any such Person in connection with the activities of the Company or
such indemnities, regardless of whether the Company would have the power to
indemnify such Person against such liability under the provisions of this
Agreement. The Board and the Company may enter into indemnity contracts with
Covered Persons and adopt written procedures pursuant to which arrangements are
made for the advancement of expenses and the funding of obligations under
Section 7.6 and containing such other procedures regarding indemnification as
are appropriate.
7.8 OUTSIDE BUSINESSES
Except as provided in Section 2.5.3 of this Agreement, any Member or
Affiliate thereof may engage in or possess an interest in other business
ventures of any nature or description, independently or with others, similar or
dissimilar to the business of the Company, and the Company and the Members and
their Affiliates shall have no rights by virtue of this Agreement in and to such
independent ventures or the income or profits derived therefrom, and the pursuit
AGRINOMICS LLC 31 Limited Liability Company Agreement
of any such venture, even if competitive with the business of the Company, shall
not be deemed wrongful or improper.
ARTICLE 8
REPRESENTATIONS, WARRANTIES AND COVENANTS
8.1 IN GENERAL
As of the date hereof, and at Closing Date, each of the Members and
Agritope hereby make each of the representations and warranties applicable to
such Member as set forth in Section 8.2, and such warranties and representations
shall survive the execution of this Agreement and the closing.
8.2 REPRESENTATIONS AND WARRANTIES
Each Member hereby represents and warrants that:
8.2.1 ORGANIZATION AND EXISTENCE
Such Member is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its formation and
governance.
8.2.2 POWER AND AUTHORITY
Such Member has the full power and authority to execute, deliver and
perform this Agreement, and to own and lease its properties and to carry on its
business as now conducted and as contemplated hereby.
8.2.3 AUTHORIZATION AND ENFORCEABILITY
The execution and delivery of this Agreement by such Member and the
carrying out by such Member of the transactions contemplated hereby have been
duly authorized by all requisite corporate actions and this Agreement has been
duly executed and delivered by such Member and constitutes the legal, valid and
binding obligation of such Member, enforceable against it in accordance with the
terms hereof, subject as to enforceability of remedies, to limitations imposed
by bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the enforcement of creditors' rights generally and
general principles of equity.
8.2.4 NO GOVERNMENTAL CONSENTS
No authorization, consent or approval of, notice to or filing with, any
governmental authority, is required for the execution, delivery and performance
by such Member of this Agreement.
AGRINOMICS LLC 32 Limited Liability Company Agreement
8.2.5 NO CONFLICT OR BREACH
None of the execution, delivery and performance by such Member of this
Agreement, the compliance with the terms and provisions hereof, and the carrying
out of the transactions contemplated hereby, conflicts or will conflict with or
will result in a breach or violation of any of the terms, conditions or
provisions of any law, governmental rule or regulation or the charter documents,
as amended, or bylaws, as amended, of such Member or any order, writ,
injunction, judgment or decree of any court of governmental authority against
such Member or by which it or any of its proprieties is bound, or any loan
agreement, indenture, mortgage, note, resolution, bond, or contract or other
agreement or instrument to which such Member is a party or by which it or any of
its properties is bound, or constitutes or will constitute a default thereunder
or will result in the imposition of any lien upon any of its properties.
8.2.6 NO PROCEEDINGS
There are no suits or proceedings pending, or to the knowledge of such
Member, threatened in any court or before any regulatory commission, board or
other governmental administrative agency against or affecting such Member that
could have a material adverse effect on the business or operations of such
Member, financial or otherwise, or on its ability to fulfill its obligations
hereunder.
8.2.7 EXISTENCE OF VALID PERMITS
To the best knowledge of ACTTAG, Inc. and Agritope, all licenses,
permits, franchises, orders or approvals of any public authority (the
"Permits"), if any, including under environmental laws, necessary to the conduct
of its activities under the ACTTAG Gene Discovery Program through the Closing,
are in full force and effect and no proceedings are pending or threatened, to
revoke or limit any such Permit and no such Permit is non-transferable or will
require the consent of any public authority in order to validly transfer it to
the Company.
8.2.8 TRANSFER OF CONTRACTS; INTELLECTUAL PROPERTY
(i) ACTTAG, Inc. and its Parent have the right to transfer or license
to the Company all rights, interests and obligations to be transferred or
licensed under this Agreement, the Assignment and Assumption Agreement and the
Agritope Research Contracts; and none of such rights, interests and obligations
shall be adversely affected by the execution, delivery or performance of this
Agreement, the Assignment and Assumption Agreement or any of the Research
Contracts.
(ii) The Assignment and Assumption Agreement, as well as the Existing
Agritope Collection, taken together contain a true, complete and correct list
and description of all the contracts and agreements, whether written or oral,
and materials obtained or used to date by Agritope or ACTTAG, Inc. to conduct
the ACTTAGTM Gene Discovery Program. It is understood that the Company intends
AGRINOMICS LLC 33 Limited Liability Company Agreement
to use such contracts and agreements as part of its conduct of the Research
Program (collectively, the "Contracts" under this clause (ii)).
Each Contract is a valid, binding and enforceable agreement.
ACTTAG, Inc. and its Parent have fulfilled all material obligations required
pursuant to the Contracts to have been performed by them prior to the Closing
Date and ACTTAG, Inc. and its Parent have no reason to believe that the Company,
the Members and/or their Affiliates, as the case may be, will not be able to
exercise, when applicable, all of their rights under the Contracts.
ACTTAG, Inc. and its Parent are not in breach of or default under any Contract
and are not aware of any breach or default by another party to the Contracts,
and no event has occurred which with the passage of time or giving of notice or
both would constitute such a default, result in a loss of rights or result in
the creation of any lien, charge or encumbrance, thereunder or pursuant thereto.
(iii) To the knowledge of ACTTAG, Inc. and its Parent, ACTTAG, Inc. and
its Affiliates own, or are licensed to use, or otherwise have the right to use
all patents, trademarks, service marks, trade names, logos, franchises, and
copyrights, and all applications for any of the foregoing, and all technology,
inventions, collections of biological materials, trade secrets, know-how,
computer software and processes used in the conduct of ACTTAGTM Gene Discovery
Program as now or heretofore conducted by Agritope and ACTTAG, Inc. (it being
understood that the Company intends to use such items as part of its conduct of
the Research Program). To the knowledge of ACTTAG, Inc. or its Parent, none of
the technology, rights or other services, products or activities to be
contributed by the Member to the Company would, as so performed or provided, or
as used or to be further used as contemplated, infringe any intellectual
property right of any person or entity or would be the object of any competing
claim of right to use or own. Each Member will promptly inform the other of any
such knowledge that it may obtain during the term of the Company. EXCEPT AS SET
FORTH HEREIN, NEITHER MEMBER MAKES ANY WARRANTIES HEREUNDER, AS TO RESEARCH
SUCCESS, MERCHANTABILITY OR NONINFRINGEMENT, AND THE MEMBERS HEREBY DISCLAIM ANY
IMPLIED WARRANTIES AND ANY WARRANTIES ARISING BY TRADE USAGE OR COURSE OF
PERFORMANCE .
8.2.9 COVENANTS
Agritope and ACTTAG, Inc. shall, between the date of signature of this
Agreement and the Closing Date: (i) do all things necessary to obtain, preserve,
and keep in full force and effect the rights, licenses, permits and intellectual
property material to the rights, property (including intellectual property),
contracts, obligations, interests and assets to be contributed to the Company
pursuant to the Assignment and Assumption Agreement ; (ii) shall maintain,
preserve and keep in good order and condition all property to be contributed to
the Company pursuant to the Assignment and Assumption Agreement ; (iii) not
AGRINOMICS LLC 34 Limited Liability Company Agreement
modify or amend any Contract, or waive any rights relating thereto, without the
prior written approval of RP Ag Co.
8.3 INDEMNITIES
8.3.1 INDEMNIFICATION
Each Party shall indemnify the Company and (only to the extent a Party
or its Affiliates suffers damage separate from that of the Company) each Party
and its Affiliates, and their officers, directors, employees and representatives
for, and shall hold them harmless from, any and all damages, losses,
obligations, liabilities, claims, costs and expenses, including, without
limitation, attorney's fees, court costs, interests and penalties (collectively
"Liabilities") asserted against or incurred or sustained by any of them relating
to or arising out of (i) any inaccuracy as of the Closing Date of any
representation, or breach of any of the warranties or representations, or (ii)
any failure to comply with any of its covenants or agreements contained in this
Agreement or in the Research Contracts to which it is party.
8.3.2 INDEMNIFICATION PROCEDURE
(a) Upon obtaining knowledge thereof, a Person who may be entitled to
indemnification hereunder (the "INDEMNITEE") shall promptly give the party who
may be obligated to provide such indemnification (the "INDEMNITOR") written
notice of any Liability which the Indemnitee has determined has given or could
give rise to a claim for indemnification hereunder (a "NOTICE OF CLAIM"),
provided that the failure to give such notice shall not relieve the Indemnitor
of its indemnity obligation hereunder except to the extent that such failure
substantially prejudices its defense of such Liability. A Notice of Claim shall
specify in reasonable detail the nature and all known particulars related to a
Liability. The Indemnitor shall perform its indemnification obligations in
respect of a Liability described in a Notice of Claim, as the case may be,
within 30 days after the Indemnitor shall have received such Notice of Claim;
provided, however, such obligation shall be suspended so long as the Indemnitor
is in good faith performing its obligations under Section 8.3.2(b) hereof with
respect to such Liability.
(b) The Indemnitor shall have the right and obligation at its own cost
and expense, to cure, remediate, mitigate, remedy or otherwise handle any event
or circumstance which gives rise to a Liability in respect of which a Notice of
Claim has been given. Such right and obligation shall include, without
limitation, the sole and exclusive right, at its sole cost and expense, to
defend, contest or otherwise oppose any third party claim, demand, suit, action
or proceeding related to such event or circumstance with legal counsel selected
by it. Such proceeding shall be prosecuted diligently by the Indemnitor to a
final conclusion or compromised or settled at the discretion of the Indemnitor,
provided however that the Indemnitor may not enter into any such compromise or
settlement which involves equitable relief against the Indemnitee unless the
Indemnitee consents thereto, which consent shall not be unreasonably withheld,
and provided further that the Indemnitor may not enter into any such compromise
or settlement that does not include as an unconditional term thereof, the giving
AGRINOMICS LLC 35 Limited Liability Company Agreement
by each claimant or plaintiff to each Indemnitee of a release from all liability
in respect of such claim. The Indemnitor shall promptly inform the Indemnitee of
all material developments related to any such event or circumstance.
Notwithstanding anything contained herein to the contrary, the Indemnitee shall
have the right, but not the obligation, to participate, but not control, at its
own cost and expense, in the defense, contest or other opposition of any such
third party claim, demand, suit, action or proceeding through legal counsel
selected by it, provided however that the Indemnitor shall bear the reasonable
costs of the counsel for the Indemnitee if counsel for the Indemnitor shall have
reasonably determined that such counsel may not properly represent both the
Indemnitor and the Indemnitee. So long as the Indemnitor is in good faith
performing its obligations under this Section 8.3.2, the Indemnitee shall at all
times, at the Indemnitor's cost and expense, cooperate in all reasonable ways
with the Indemnitor in connection with contesting the third party claim. If the
Indemnitor fails to perform its obligations under this Section 8.3.2, then the
Indemnitee shall have the right, but not the obligation, to take the actions
which the Indemnitor would have had the right to take in connection with the
performance of such obligations and, if the Indemnitee is entitled to
indemnification hereunder in respect of the event or circumstance as to which
the Indemnitee takes such actions, then the Indemnitor shall, in addition to
indemnifying Indemnitee for the Liability, indemnify the Indemnitee for all of
the legal, accounting and other costs, fees and expenses reasonably and actually
incurred in connection therewith, provided however that an Indemnitor shall not
be required to indemnify an Indemnitee for any amount paid or payable by such
Indemnitee in the settlement of any such third party claim agreed to without the
consent of the Indemnitor (which shall not be unreasonably withheld or delayed).
(c) Notwithstanding anything contained herein to the contrary, an
Indemnitor shall not have any Liability unless and until the aggregate amount of
all liabilities for which such Indemnitor is responsible exceeds $25,000, in
which event the Indemnitor is responsible for all of the liabilities.
ARTICLE 9
DISPUTE RESOLUTION
9.1 DISPUTE RESOLUTION BY SENIOR OFFICERS
In the event a dispute arises between the Members regarding the
application or interpretation of any provision of this Agreement (or between a
Member and Agritope, as to the application or interpretation of Article 8,
Article 9, or Sections 10.1(c), 10.4(b) and 15.15), the business or affairs of
the Company or regarding any management decision for which Board approval is
required but has not been obtained, the dispute shall be submitted for
good-faith negotiation for a period of 90 days by the respective chief executive
officers of the Members (or Agritope, as the case may be). Prior to the end of
such 90-day period, no Member shall initiate any other remedies with respect to
such dispute. In any event, any dispute or difference relating to the strategy
of the Company shall not be subject to arbitration or litigation and each Member
AGRINOMICS LLC 36 Limited Liability Company Agreement
may in its sole discretion approve or reject any decision for which Board
approval is required in this regard.
9.2 ARBITRATION OF DISPUTES
If the parties fail to reach agreement with respect to a dispute or
difference (other than as to a question relating to patent validity, which the
Members intend will be decided in litigation and not in arbitration, or
decisions relating to the strategy of the Company which the Members may approve
or reject in their sole discretion as provided for in Section 9.1), between the
parties arising out of or in connection with this Agreement, the dispute or
difference will, to the fullest extent permitted by law, be determined by
arbitration in New York City, in accordance with the Commercial Arbitration
Rules of the American Arbitration Association by an independent and impartial
arbitrator, who (unless the parties agree otherwise) shall have had both
training and experience as an arbitrator of corporate partnership or LLC matters
and who shall be, and for at least ten years shall have been, a partner,
shareholder or member in a highly respected law firm headquartered in the United
States. The arbitrator may decide any issue as to whether, or as to the extent
to which, any dispute is subject to the arbitration and other dispute resolution
provisions in this Agreement. The arbitrator must base the award on the
provisions of this Agreement and must render the award in a writing which must
include an explanation of the reasons for such award. Any arbitration pursuant
to this section will be governed by the substantive laws of Delaware applicable
to contracts made and to be performed in that state, without regard to conflicts
of law rules, and by the arbitration law of the Federal Arbitration Act (9
U.S.C. ss.1 et seq.). Judgment upon the award rendered by the arbitrator may be
entered by any court having jurisdiction thereof. The statute of limitations of
Delaware applicable to the commencement of a lawsuit will apply to the
commencement of an arbitration under this Section. All fees, costs and expenses
of the arbitrator, and all other costs and expenses of the arbitration, will be
shared equally by the parties to this Agreement unless such parties agree
otherwise or unless the arbitrator in the award assesses such costs and expenses
against one of such parties or allocates such costs and expenses other than
equally between such parties. Notwithstanding the foregoing, either party may,
on good cause shown, seek a temporary restraining order and/or a preliminary
injunction from a court of competent jurisdiction, to be effective pending the
institution of the arbitration process and the deliberation and award of the
arbitrator.
ARTICLE 10
TRANSFERS OF COMPANY INTERESTS
10.1 RESTRICTIONS ON TRANSFER
(a) Except as otherwise permitted by this Agreement, neither Member
shall Transfer all or any portion of its Interest without the prior written
consent of the other Member.
AGRINOMICS LLC 37 Limited Liability Company Agreement
(b) Neither Member shall transfer, or attempt to transfer, its Interest
in violation of the Securities Act of 1933 or any other applicable federal or
state law.
(c) In the event of a Change of Control as to a Member, such Member
(the "Change Member") shall deliver a written notice to the other Member (the
"Option Member") within fifteen (15) days of the closing of the Change of
Control, stating that the transaction has occurred and describing such
transaction in reasonable detail. In that event, the Option Member shall then
have the option, which it may exercise within its sole discretion, to demand
that the Change Member formally and in writing state a price for the Change
Member's entire Interest in the Company (the "Strike Price"). The Option Member
shall notify the Change Member of its decision at any time within sixty (60)
days after receipt of notice of Change of Control from the Change Member. If the
Option Member gives no such notice of such a demand, it will be deemed to have
waived its option as to that Change of Control, and in that event all terms and
conditions of this Agreement and the Research Contracts with the Members or
their Affiliates shall remain in full force and effect as if such Change of
Control had not occurred. If the Option Member makes such a demand within such
60 days, then the Change Member shall either (i) make such a formal statement of
the Strike Price; or (ii) decline or otherwise fail to make such a formal
statement of the Strike Price within thirty (30) days following the demand by
the Option Member, in which event the Strike Price shall equal the fair market
value at that time of the Change Member's entire Interest in the Company, in the
opinion of one investment banking firm (the "Investment Banker") chosen by the
Option Member from the following list: ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, or a successor firm to any of the foregoing, and
the Strike Price shall be determined by the Investment Banker within 30 days.
The cost of obtaining such an opinion shall be borne by the Change Member.
Following such formal statement, or such determination, of the Strike Price, the
Option Member will have the option of: (1) requiring the Change Member (which
will have no right to refuse) to sell the Change Member's Interest to the Option
Member at the Strike Price; (2) requiring the Change Member (which will have no
right to refuse) to buy the Option Member's entire Interest at the Strike Price;
or (3) retaining the status quo, with no purchase or sale of any Interest. The
Option Member will have thirty (30) days following the Change Member's formal
statement of the Strike Price (or the determination of the Strike Price by the
Investment Banker, if applicable) in which to elect which of these three courses
it will take. If the Option Member makes no such election in such 30 days, it
will be deemed to have elected to retain the status quo as stated in course (3).
If the Option Member elects to buy the Change Member's Interest, the Option
Member will have the option of leaving the Change Member's Research Contracts in
effect or terminating them. If the Option Member elects to sell its Interest to
the Change Member, the Option Member will have the option of leaving its own
Research Contracts in effect or terminating them. If the Option Member elects
the status quo following the statement or determination of the Strike Price,
this Agreement and the Change Member's Research Contracts will stay in effect,
and the Option Member will have the option of terminating its own Research
Contracts, or leaving them in effect. The closing of the sale (if any) of the
Interest of the Option Member to the Change Member or of the Change Member to
the Option Member, as the case may be, shall occur within forty-five (45) days
AGRINOMICS LLC 38 Limited Liability Company Agreement
following any election by the Option Member that such a sale will occur. The
Strike Price will be payable in cash at the closing. Such a sale shall be on
terms that include closing conditions, representations, warranties and covenants
customary in transactions under such circumstances.
10.2 PERMITTED TRANSFERS
Notwithstanding provisions of Section 10.1 above, and subject to the
conditions and restrictions set forth in Section 10.3, a Member may at any time
Transfer (any such Transfer being referred to in this Agreement as a "Permitted
Transfer") all or any portion of its Interest if and only if such sale is to:
(a) any other Member or an Affiliate of another Member, (b) any Affiliate of the
transferor, (c) the transferor's administrator or trustee to whom such Interest
is transferred involuntarily by operation of law, (d) to a third party in a
Waived Transfer (as defined in Section 10.4(a)), (e) [ * ] or (f) through a
merger or consolidation that effects a Change of Control, subject to the other
Member's rights as Option Member under Section 10.1(c). [ * ].
10.3 CONDITIONS TO PERMITTED TRANSFERS
A Permitted Transfer shall not be treated as valid unless and until the
following conditions are satisfied:
10.3.1 REQUIRED DOCUMENTATION
Except in the case of a Transfer involuntarily by operation of law, the
transferee becomes a Party to this Agreement as a Member and the transferor and
transferee shall execute and deliver to the Company such documents and
instruments of conveyance as may be necessary or appropriate in the opinion of
counsel to the Company to effect such Transfer and to confirm the agreement of
the transferee to be bound by the provisions of this Agreement, including this
Article 10. In the case of a Transfer of Interests involuntarily by operation of
law, the Transfer shall be confirmed by presentation to the Company of legal
evidence of such Transfer, in form and substance satisfactory to counsel to the
Company.
10.3.2 REIMBURSEMENT OF COSTS
In all cases, the Company shall be reimbursed by the transferor and/or
transferee for all costs and expenses that it reasonably incurs in connection
with such Transfer.
10.3.3 LEGAL OPINIONS
Except in the case of a Transfer involuntarily by operation of law, the
transferor shall furnish to the Company an opinion of counsel, which counsel and
opinion shall be reasonably satisfactory to the nontransferring Member, that (a)
the Transfer will not cause the Company to terminate for federal income tax
purposes and that such Transfer will not cause the application of the rules of
Code Sections 168(g)(1)(B) and 168(h) (generally referred to as the "tax exempt
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
AGRINOMICS LLC 39 Limited Liability Company Agreement
entity leasing rules") or similar rules to apply to the Company, the Property,
the Members or their Affiliates; (b) such Transfer will not cause the Company to
become taxable as a corporation for federal income tax purposes, and (c) such
Transfer will not cause adverse tax consequences to the non-transferring Member.
10.3.4 TAX INFORMATION
The transferor and transferee shall furnish the Company with the
transferee's taxpayer identification number, sufficient information to determine
the transferee's initial tax basis in the Interest transferred, and any other
information reasonably necessary to permit the Company to file all required
federal and state tax returns and other legally required information statements
or returns.
10.4 RIGHTS OF FIRST REFUSAL
(a) After June 30, 2004, if a Member (the "Selling Member") desires to
make an offer to Transfer its Interest to a third party that is neither a Member
nor an Affiliate of the Selling Member, or to accept an offer from such a third
party to purchase all or any part of its Interest, it shall so notify the other
Member (the "Rights Member") of such desire prior to making or accepting such
offer, as the case may be, on a binding basis, along with a written description
(the "Transfer Notice") of the principal terms and conditions (including the
proportion of the Interest desired to be sold, the price, the payment terms, and
the closing schedule) and the identity of the proposed buyer (the "Proposed
Buyer"). Prior to such date, no Transfer which is not otherwise a Permitted
Transfer as set forth in Section 10.2 shall be permitted unless specifically
consented to in writing by the other Member. The Rights Member shall have a
period of thirty (30) days following receipt of a Transfer Notice to elect to
purchase the Interest of the Selling Member (or the designated portion thereof
so desired to be sold by the Selling Member) on the same terms and conditions
described in the Transfer Notice, in lieu of the sale to the Proposed Buyer. If
any of the purchase price described in the Transfer Notice is proposed to be
paid in property or services other than cash or cash equivalents, the Rights
Member shall be entitled, at its sole discretion, should it elect to purchase
such Interest or portion of an Interest from the Selling Member, either to pay
such portion of the price in substantially similar form or to substitute for
such non-cash portion of the price an equivalent value in cash or cash
equivalents. If the Rights Member declines to purchase such Interest (or
portion) of the Selling Member, or makes no election within such 30-day period
(in which case it will be deemed to have declined at the end of such 30-day
period to make such purchase), the Selling Member shall be entitled to sell its
Interest to the Proposed Buyer or an Affiliate of the Proposed Buyer on the
terms and conditions stated in the Transfer Notice, in a sale to be closed
within the one hundred twenty (120) days immediately following such waiver (or
deemed waiver) by the Rights Member to purchase. In that event, such sale shall
be considered a "Waived Transfer" hereunder. Any other Transfer, including,
without limitation, to a different buyer, on different terms or conditions, or
closed following such 120-day period, shall not be made unless the Selling
Member has first given another Transfer Notice and afforded the Rights Member
AGRINOMICS LLC 40 Limited Liability Company Agreement
another opportunity to elect to purchase such Interest (or portion thereof)
under such subsequent Transfer Notice as described above in this section.
(b) After June 30, 2001, in the case that Agritope shall retain more
than 50% of the stock of ACTTAG, Inc., and otherwise, after June 30, 2004, if
ACTTAG, Inc. desires to issue capital stock in ACTTAG, Inc. to a third party
that is not Agritope or an Affiliate of Agritope or ACTTAG, Inc., or if Agritope
desires to make an offer to Transfer any of its outstanding capital stock in
ACTTAG, Inc. to such a third party or to accept an offer from such a third party
to purchase all or any part of such outstanding stock, ACTTAG, Inc. or Agritope,
as the case may be, shall so notify RP Ag Co. of such desire prior to making or
accepting such offer, as the case may be, on a binding basis, along with a
written description (the "Stock Notice") of the principal terms and conditions
(including the number of shares desired to be issued or sold, the price, the
payment terms, and the closing schedule) and the identity of the proposed buyer
(the "Proposed Buyer" under this clause (b)). Prior to such date, no such
issuance or sale shall be permitted without the consent of RP Ag Co. RP Ag Co.
shall have a period of thirty (30) days following receipt of a Stock Notice to
elect to purchase the shares proposed to be issued or sold on the same terms and
conditions described in the Stock Notice, in lieu of the sale to the Proposed
Buyer. If any of the purchase price described in Stock Notice is proposed to be
paid in property or services other than cash or cash equivalents, RP Ag Co.
shall be entitled, at its sole discretion, should it elect to purchase such
shares, either to pay such portion of the price in substantially similar form or
to substitute for such non-cash portion of the price an equivalent value in cash
or cash equivalents. If RP Ag Co. declines to purchase such shares in ACTTAG,
Inc., or makes no election within such 30-day period (in which case it will be
deemed to have declined at the end of such 30-day period to make such purchase),
ACTTAG, Inc. or Agritope shall be entitled to issue or to sell, as the case may
be, such shares to the Proposed Buyer or an Affiliate of the Proposed Buyer on
substantially the terms and conditions stated in the Stock Notice, in a
transaction to be closed within the one hundred twenty (120) days immediately
following such waiver (or deemed waiver) by RP Ag Co. of its right to purchase.
Any other issuance or sale of shares in ACTTAG, Inc., whether to a different
buyer, on different terms or conditions, or closed following such 120-day
period, shall not be made unless ACTTAG, Inc. or Agritope, as the case may be,
has first given another Stock Notice and afforded RP Ag Co. another opportunity
to elect to purchase the shares covered by such subsequent Stock Notice as
described above in this section.
10.5 PROHIBITED TRANSFERS
(a) Any purported Transfer of an Interest that is not a Permitted
Transfer or that is not consented to by the other Member pursuant to Section
10.1 shall be null and void and of no force or effect whatever; provided that,
if the Company is required under mandatory statutory provisions or judicial
order to recognize a Transfer that is not a Permitted Transfer (or if the
Company, in its sole discretion, elects to recognize a Transfer that is not a
Permitted Transfer), the Interest transferred shall be strictly limited to the
transferor's rights to allocations and distributions as provided by this
AGRINOMICS LLC 41 Limited Liability Company Agreement
Agreement with respect to the transferred Interest, which allocations and
distributions may be applied (without limiting any other legal or equity rights
of the Company) to satisfy any debts, obligations or liabilities for damages
that the transferor or transferee of such Interest may have to the Company, and
the transferee shall, to the fullest extent permitted by law, have no right to
receive any information or accounting of the affairs of the Company, shall not
be entitled to inspect the books or records of the Company, and shall not have
any of the rights of a Member under the Act or this Agreement. Accordingly, to
the fullest extent permitted by law, the transferee shall have no authority to
act for or to bind the Company, to inspect the Company's books, to vote as a
Member under this Agreement, or otherwise to be treated as a Member. In such
case, the parties engaging or attempting to engage in such Transfer shall be
liable to indemnify and hold harmless the Company and the nontransferring Member
from all cost, liability and damage that any of such indemnified parties may
incur (including, without limitation, incremental tax liabilities, reasonable
lawyers' fees and expenses) as a direct result of such Transfer or attempted
Transfer and efforts to enforce the indemnity granted hereby.
(b) Any Person who acquires an Interest, including the transferee in a
Permitted Transfer, and who is not admitted as a substituted Member pursuant to
Section 10.3 (a "Non-Admitted Member"), shall, to the fullest extent permitted
by law, be entitled only to allocations and distributions with respect to such
acquired Interest in accordance with this Agreement and shall have no right of
any information or accounting of the affairs of the Company, shall not be
entitled to inspect the books or records of the Company and shall not have any
of the rights of a Member under the Act or this Agreement. Accordingly, the
assignee, to the fullest extent permitted by law, shall have no authority to act
for or bind the Company, to inspect the Company's books, to vote as a Member
under this Agreement, or otherwise to be treated as a Member.
10.6 SPECIFIC PERFORMANCE
Each of the Members acknowledges that the rights and obligations
provided by this Article 10 are of unique value to it and the payment of
monetary damages could not adequately compensate the other Members for any
breach of the obligations set forth in this Article 10. Accordingly, the rights
of the Members set forth in this Article 10 shall be specifically enforceable in
accordance with their terms.
ARTICLE 11
DISSOLUTION AND WINDING UP
11.1 GENERAL
(a) The Company shall be dissolved and its affairs shall be wound up:
(i) in the event of the Bankruptcy or dissolution of ACTTAG,
Inc.'s Parent or ACTTAG, Inc., upon the written election by RP Ag Co., in its
sole and absolute discretion, within ninety (90) days of such Bankruptcy, to
dissolve the Company;
AGRINOMICS LLC 42 Limited Liability Company Agreement
(ii) in the event of the Bankruptcy or dissolution of RP Ag
Co.'s Parent or RP Ag Co., upon the written election by ACTTAG, Inc., in its
sole and absolute discretion, within ninety (90) days of such Bankruptcy, to
dissolve the Company;
(iii) upon an election to dissolve the Company made by the
Electing Member pursuant to Section 12.2(a) or by ACTTAG, Inc. pursuant to
Section 12.2(b);
(iv) upon the unanimous written consent of the Members;
(v) the passage of ninety (90) days after the sale or other
disposition of all or substantially all of the assets of the Company; or
(vi) upon the entry of a decree of judicial dissolution
pursuant to Section 18-802 of the Delaware Act.
(b) Except as set forth in Section 12, the occurrence of the
Bankruptcy or dissolution of a Member shall not cause a Member to cease to be a
member of the Company, and, except as expressly provided in Section 11.1(a)(i)
or (ii), upon the occurrence of such an event, the business of the Company shall
be continued without dissolution.
(c) The Company shall terminate when all assets of the Company, after
payment of or due provision for all debts, liabilities and obligations of the
Company, shall have been distributed to the Members in the manner provided for
in this Article 11 and Section 5.3, and the Certificate shall have been canceled
in the manner required by the Act.
11.2 WINDING UP AND LIQUIDATION
Upon the dissolution of the Company, the Company shall promptly wind up
its affairs and liquidate and distribute its assets in accordance with Section
5.3 and this Section 11.2, unless the Members unanimously elect otherwise. The
winding up of the Company's affairs and the liquidation of the Company's assets
shall be conducted and supervised by the Liquidating Agent. The Liquidating
Agent shall have all of the rights and powers with respect to the assets and
liabilities of the Company, in connection with the winding up and liquidation of
the Company, that the Members have with respect to the assets and liabilities of
the Company during the term of the Company, and the Liquidating Agent is hereby
expressly authorized and empowered to execute any and all documents necessary or
desirable to effectuate the winding up and liquidation of the Company and the
transfer of any Property of the Company.
11.3 PRIORITY ON LIQUIDATION
The Liquidating Agent shall liquidate the assets of the Company as
promptly as practicable. The proceeds of such liquidation shall be applied
pursuant to Section 5.3.
AGRINOMICS LLC 43 Limited Liability Company Agreement
ARTICLE 12
PRIOR TERMINATION
12.1 TERMINATION EVENTS
(a) Subject to the provisions of Section 11 above, in the event of the
Bankruptcy or dissolution of either Member or its Parent, the other Member may,
in its sole and absolute discretion, require such Member to resign and cease to
be a Member, at its option and without prejudice to any of its other legal or
equitable rights or remedies, by giving notice to such Member;
(b) If either Member or its Parent materially breaches any of the
terms, conditions or agreements contained in this Agreement or in any Research
Contract to which it is a party to be kept, observed or performed by it, the
other Member may require such Member to resign and cease to be a Member, at its
option and without prejudice to any of its other legal or equitable rights or
remedies, by giving the Member who committed the material breach ninety (90)
days' notice in writing, unless the notified Member within such 90-day period
shall have cured the breach. Neither Member or its Parent will be considered in
breach of this Agreement or such a Research Contract for purposes of the
termination remedy stated herein during any period in which there is a good
faith dispute between the Members as to the existence of such breach. If the
Members are, despite negotiations at the highest levels of their respective
managements over a period of at least ninety days, unable to resolve any good
faith dispute between them as to the existence of such breach, such dispute may
at the election of either Member be resolved in accordance with Article 9; and
(c) If prior to July 1, 2001, the Company shall not [ * ], then RP Ag
Co. may, in its sole and absolute discretion, at or at any time on or after July
1, 2001 (but prior to the time, if any, at which the Company shall have [ * ]),
elect to (i) resign and cease to be a Member and (ii) terminate the Research
Contracts to which it or its Parent (as the case may be) is a party (an "RP Ag
Co. Termination"). In that event, RP Ag Co. will not be required to make any
further Additional Capital Contribution of cash that has not previously become
due as described in Section 3.6(a) (where any contribution that would have
become due on the date of resignation shall not be considered to have become
previously due), with no other right for indemnification or compensation
whatsoever for the Company, ACTTAG, Inc. or its Affiliates.
12.2 EFFECTS OF TERMINATION
(a) In the event of the Bankruptcy or dissolution of a Member or its
Parent or material breach pursuant to clause (a) or clause (b) of Section 12.1,
the other Member (the "Electing Member") may, in its sole discretion, elect to
take any one of the following three courses of action: (i) to continue the
business of the Company and purchase the Interest of the other Member pursuant
to the procedure set forth in Section 12.2(c) below; (ii) to continue the
business of the Company with the other Member continuing as a Non-Admitted
Member as described in Section 10.5; or (iii) to declare that the Company will
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
AGRINOMICS LLC 44 Limited Liability Company Agreement
be dissolved and liquidated as provided in Article 11. If the Electing Member
makes no such election by written notice to the other Member within sixty (60)
days of such event, the Electing Member will be deemed to have elected to take
the course of action described in clause (ii). If the Electing Member elects or
is deemed to elect to take the course of action described in clause (ii) above,
it will have the further option, exercisable at any time thereafter, of leaving
its own Research Contracts in effect or terminating them.
(b) In the event of an RP Ag Co. Termination, ACTTAG, Inc. may elect to
take either one of the following courses of action: (i) to continue the business
of the Company and purchase RP Ag Co.'s Interest pursuant to the procedure set
forth in Section 12.2(c) below; or (ii) to declare that the Company will be
dissolved and liquidated as provided in Article 11. If ACTTAG, Inc. makes no
such election by written notice to RP Ag Co. within sixty (60) days of such
event, ACTTAG, Inc. will be deemed to have elected to take the course of action
described in clause (ii).
(c) If the Electing Member elects to purchase the Interest of the
other Member under Section 12.2(a), or if ACTTAG, Inc. elects to purchase RP Ag
Co.'s Interest pursuant to Section 12.2(b), the purchase price for such Interest
shall be determined by the mutual agreement of the buyer and the seller;
provided, however, that if no such mutual agreement is reached within sixty (60)
days following such election, the purchase price shall be finally determined to
be the fair market value of the Interest to be sold, in the opinion of one
investment banking firm chosen by the buyer from the following list: ▇▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇.▇. ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, or a successor firm to
any of the foregoing. The cost of obtaining such an opinion shall be borne by
the seller of the Interest, and may be deducted from the sales proceeds. The
purchase price will be payable in cash at the closing, which shall occur within
forty-five (45) days following the later of the determination of the purchase
price and the buyer's election to purchase such Interest. Such a sale shall be
on terms that include closing conditions, representations, warranties and
covenants customary in transactions under such circumstances. In such case, both
Members' Research Contracts will be terminated.
ARTICLE 13
ACCOUNTING AND REPORTS
13.1 BOOKS AND RECORDS
(a) The Board shall implement standard procedures with respect to
accounting, financial reporting and management information, including, without
limitation, statements reflecting Company distributions of Net Cash Flow,
earnings, Profits and Losses, residual value of Company Property and taxable
income.
(b) At all times during the term of the Company, the Board shall keep
or cause to be kept books of accounts at the principal office of the Company in
which shall be entered fully and accurately each transaction of the Company.
Each Member and its representatives shall have access to such books, records and
documents during reasonable business hours and may inspect and make copies of
AGRINOMICS LLC 45 Limited Liability Company Agreement
any of them. The Board may delegate to a third party or Member the duty to
maintain and oversee the preparation of such records and books of account.
(c) In addition to its record-keeping requirements as provided herein,
the Board shall maintain records, as required, to demonstrate compliance with
United States Foreign Corrupt Practices Act requirements, including lists
reflecting the Company's use of agents.
13.2 BANK ACCOUNTS
The Company will maintain accounts for the deposit and disbursement of
all funds of the Company at such banks as the Board shall approve. All funds of
the Company will be deposited promptly in such accounts. The funds of the
Company shall not be commingled with the funds of any other Person and the Board
and the CEO shall not employ, or permit any other Person to employ, such funds
in any manner except for the benefit of the Company. All bank accounts and other
depository accounts shall be opened in the name of the Company.
13.3 ACCOUNTING METHOD
The Company shall adopt the accrual method of accounting for financial
reporting and federal and state income tax purposes. The financial reports of
the Company shall be prepared on an accrual basis in accordance with GAAP.
13.4 FISCAL YEAR
The Company shall use the Fiscal Year as both its fiscal year for
financial reporting and its taxable year for federal and state income tax
purposes, unless the Code or state law requires use of a different taxable year.
13.5 REPORTS; TAX RETURNS
Copies of all accounts, reports and other writings pertaining to the
business of the Company furnished by a Member or the Company to any Member or
regulatory agency shall contemporaneously be delivered to all Members. Copies of
all reports, notices and other writings pertaining to the Company furnished to a
Member by the accountants for the Company shall promptly be delivered to all the
Members. Within 90 days after the end of each Fiscal Year, the CEO shall cause
to be delivered to each Member a report of financial activities of the Company,
including, without limitation, (a) a balance sheet reflecting the Company's
financial position as of the end of such Fiscal Year, (b) supporting profit and
loss statements, and (c) a statement of change in financial position of the
Company for such year. The Board shall cause, at the Company's expense, a
regular annual audit of the books and records of the Company at the end of each
Fiscal Year by the Company's outside auditors and the delivery to each Member
within 120 days after the end of each Fiscal Year the audited financial
statements for such Fiscal Year and any audit report issued to the Company in
AGRINOMICS LLC 46 Limited Liability Company Agreement
connection with such audit. The CEO shall cause to be prepared and filed, on the
Company's behalf and at the Company's expense, all federal, state and other tax
returns required to be filed, and shall submit the same to the Members for
review and approval not less than 30 days prior to the respective due dates for
such returns (including any extensions thereof), but, with respect to the
Company's federal income tax information return, in no event later than 45 days
prior to the due date for such return (including any extensions thereof).
13.6 REQUIRED GOVERNMENTAL FILINGS
The CEO shall cause the Company to file, on or before the dates the
same may be due, giving effect to extensions obtained, all reports, returns and
applications that may be required by any governmental or quasi-governmental body
having jurisdiction.
13.7 TAX MATTERS MEMBER
(a) ACTTAG, Inc. shall be the "tax matters partner" (the "Tax Matters
Member") for the Company within the meaning of Code Section 6231(a)(7).
(b) The Tax Matters Member shall notify and provide copies to the other
Members within 5 business days (or as soon as reasonably practicable thereafter)
of any communication received from any governmental authority regarding any
proposed or existing audit, administrative or judicial proceeding, request for
information, preliminary discussion or any other formal or informal
communication regarding any tax matters pertaining to the Company or any Member.
In addition to and not in limitation of the foregoing, the Tax Matters Member
shall request, pursuant to Code Section 6223, that the other Members receive
notice from the IRS regarding any proceedings or adjustments. The Tax Matters
Member shall consult with the other Members concerning all tax matters and shall
not take any action in connection with any audit or proceeding, or enter into
any agreement with the IRS, that may adversely affect the other Members without
their express prior written consent.
13.8 AUDITOR
Unless the Board otherwise determines, the Company shall engage the
firm of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP as the Company's outside accountants and auditors.
ARTICLE 14
REGULATORY MATTERS
14.1 POLITICAL CONTRIBUTIONS
The Company shall not spend any of its funds to make direct or indirect
contributions to political candidates, nor make gifts or provide honoraria to
elective or appointive governmental officials without prior Board approval. The
Company shall timely report to the Board the making of such contributions, gifts
or honoraria. All such contributions, gifts or honoraria shall be made in
accordance with applicable laws and regulations.
AGRINOMICS LLC 47 Limited Liability Company Agreement
14.2 COMPLIANCE WITH REGULATIONS
The Company shall comply with all applicable laws, regulations and
orders of any governmental or regulatory authority. Each Member and its
Affiliates, in connection with their duties and activities with the Company and
its projects, shall comply with all laws, regulations and orders of any
governmental or regulatory authority applicable to such Person, including,
without limitation, the United States Foreign Corrupt Practices Act. Each Member
shall indemnify and hold harmless the Company and the other Member and its
Affiliates from any costs incurred by them as a result of the failure of a
Member or its Affiliates to comply with such applicable laws, regulations or
orders.
ARTICLE 15
GENERAL PROVISIONS
15.1 NOTICES
Any notice, request, instruction or other document to be given
hereunder by a Member to another Member hereto shall be in writing, delivered in
person, or mailed by certified or registered mail, return receipt requested, or
transmitted by facsimile transmission with electronic confirmation of receipt to
the addressee's address or facsimile number set forth below (or such other
address or facsimile number as the party changing its address specifies in a
notice to the other parties):
ACTTAG, Inc.
▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chief Executive Officer
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ Coie LLP
▇▇▇ -▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and
▇▇▇▇▇-▇▇▇▇▇▇▇ Ag Company Inc.
2 ▇.▇. ▇▇▇▇▇▇▇▇▇ Drive
Research Triangle Park
North Carolina 27709 - USA
Attention: General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
AGRINOMICS LLC 48 Limited Liability Company Agreement
with a copy to:
▇▇▇▇▇-▇▇▇▇▇▇▇ Agro S.A.
▇▇-▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇
Attention: General Counsel
Facsimile: (▇▇) ▇▇ ▇▇ ▇▇ ▇▇
Notices shall be deemed to have been given on the date of service, if served
personally on the party to whom notice is to be given , or on the first day
after transmission by facsimile transmission, if transmitted by facsimile as set
forth above, or on the fifth day after mailing, if mailed as set forth above.
15.2 CONSEQUENTIAL DAMAGES; AFFILIATES
Except for damages resulting from breaches of Section 2.8 or Section
14.2, no Member or its Affiliates shall be liable to the Company or to any other
Member or its Affiliates for any indirect, incidental, special or consequential
damages relating to a breach or an alleged breach of this Agreement, including,
but not limited to, loss of revenue, cost of capital or loss of business
reputation or opportunity whether such liability arises out of contract, tort
(including negligence), strict liability or otherwise. If an Affiliate of a
Member does not comply with the provisions of this Agreement that apply to
Affiliates, then such Member shall be deemed to be in violation of such
provisions.
15.3 WAIVER
No waiver of any breach of the terms of this Agreement shall be
effective unless such waiver is in writing and signed by the Member against whom
such waiver is claimed. No waiver of any breach shall be deemed to be a waiver
of any other or subsequent breach.
15.4 SEVERABILITY
If any provision of this Agreement shall be held to be invalid, illegal
or unenforceable, such provision shall be enforced to the maximum extent
permitted by law and the parties' fundamental intentions hereunder, and the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
15.5 FURTHER ASSURANCES
Each Member shall execute such deeds, assignments, endorsements,
evidences of transfer and other instruments and documents and shall give further
assurances as shall be necessary to perform its obligations hereunder and shall
execute such estoppel and other documents as are reasonably requested by any
other Member regarding the status of the Company.
AGRINOMICS LLC 49 Limited Liability Company Agreement
15.6 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware, without regard to the choice of law
provisions of the State of Delaware or any other jurisdiction to the contrary.
15.7 COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original, but all of which shall constitute one and the
same instrument.
15.8 LIMITATION ON RIGHTS OF OTHERS
This Agreement is entered into among the Members for the exclusive
benefit of the Company, its Members, and their successors and permitted assigns.
This Agreement is not intended for the benefit of any creditor of the Company or
any other Person. Except to the extent provided by applicable statute, and then
only to that extent, no creditor or third party shall have any rights under this
Agreement or under any other agreement between the Company and any Member with
respect to any contribution to the Company or otherwise.
15.9 SUCCESSORS AND ASSIGNS
This Agreement shall be binding upon and inure to the benefit of the
Members and their respective successors and permitted assigns.
15.10 ENTIRE AGREEMENT; AMENDMENT
This Agreement constitutes the entire agreement among the Members with
respect to the subject matter hereof and supersedes all prior agreements and
understandings, whether oral or written, between the Members (and their
Affiliates) with respect to the subject matter hereof. This Agreement may be
amended only in writing signed by all of the Members.
15.11 EXPENSES
Except as otherwise provided herein or agreed to in writing by the
Members or their Affiliates, each Member shall bear its own costs and expenses,
including legal fees, associated with carrying on its business as a Member
hereof.
15.12 CONSTRUCTION
This Agreement has been submitted to the scrutiny of, and has been
negotiated by, all parties hereto and their counsel, and shall be given a fair
and reasonable interpretation in accordance with the terms hereof, without
consideration or weight being given to its having been drafted by any party
hereto or its counsel.
AGRINOMICS LLC 50 Limited Liability Company Agreement
15.13 DISCLAIMER OF AGENCY
This Agreement does not create any entity or relationship beyond the
scope set forth herein, and except as otherwise expressly provided herein, this
Agreement shall not constitute any Member the legal representative or agent of
the other, nor shall any Member or any Affiliate of a Member have the right or
authority to assume, create or incur any liability or obligation, express or
implied, against, in the name of or on behalf of any other Member, its
Affiliates, the Company or its Affiliates.
15.14 CURRENCY OF PAYMENT
Payments to be made by or to any party hereunder shall be both
denominated and payable in U.S. dollars, unless otherwise determined by the
respective parties to be in another freely exchangeable currency denominated in
U.S. dollars at the applicable exchange rate for the last business day of each
quarter as quoted by Reuters telerate page EFX= at 12 :00PM USA East Coast
time).
15.15 GUARANTY BY AGRITOPE
Agritope hereby unconditionally and irrevocably guarantees to RP Ag Co.
the performance of, and compliance with, the agreements, covenants and
obligations contained in this Agreement or in any Agritope Research Contracts by
ACTTAG, Inc. or any of its Affiliates. RP Ag Co. may therefore at its sole
discretion directly proceed against Agritope for any default or failure to
perform or observe by ACTTAG, Inc. or any of its Affiliates their agreements,
covenants and obligations contained thereunder, and provided further that
Agritope and ACTTAG, Inc. shall be jointly and severally liable for any default
or failure to perform under this Agreement and any Agritope Research Contracts.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
ACTTAG, INC.
By: /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
AGRINOMICS LLC 51 Limited Liability Company Agreement
▇▇▇▇▇-▇▇▇▇▇▇▇ AG COMPANY INC.
By: /s/▇. ▇▇▇▇▇▇▇
Name: Pascal Housset
Title: Director
AGRITOPE, INC.
By: /s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: CEO
Date: 7/15/99
AGRINOMICS LLC 52 Limited Liability Company Agreement
EXHIBIT LIST
EXHIBIT A: EXISTING AGRITOPE COLLECTION
EXHIBIT B: AGRITOPE RESEARCH AND MANAGEMENT CONTRACT
EXHIBIT C: ASSIGNMENT AND ASSUMPTION AGREEMENT AND ▇▇▇▇ OF SALE
EXHIBIT D: INITIAL BUDGET
EXHIBIT E: INITIAL OPERATING PLAN
EXHIBIT F: RP AG CO. RESEARCH CONTRACT AND LICENSE AGREEMENT
EXHIBIT G: NAME AND MAILING ADDRESS OF EACH MEMBER;
VALUE OF CONTRIBUTIONS, AND PERCENTAGE INTERESTS
EXHIBIT H: APPROVED AGREEMENTS
AGRINOMICS LLC 1 Limited Liability Company Agreement
EXHIBIT A: EXISTING AGRITOPE COLLECTION
[ * ]
[ * ] = Confidential materials omitted and filed separately with the
Securities and Exchange Commission.
AGRINOMICS LLC 2 Limited Liability Company Agreement
EXHIBIT G: NAME AND MAILING ADDRESS OF EACH MEMBER;
VALUE OF CONTRIBUTIONS, AND PERCENTAGE INTERESTS
NAME AND ADDRESS VALUE OF CONTRIBUTION PERCENTAGE INTEREST
----------------- --------------------- -------------------
ACTTAG, Inc. US$20,000,000 50%
▇▇▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇.
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇▇-▇▇▇▇▇▇▇ Ag US$20,000,000 50%
Company Inc.
2 ▇.▇. ▇▇▇▇▇▇▇▇▇ Drive
Research Triangle Park
North Carolina 27709 - USA
AGRINOMICS LLC 3 Limited Liability Company Agreement
EXHIBIT H: APPROVED AGREEMENTS
Research and Management Contract between the Company and Agritope, substantially
in the form of Exhibit B to this LLC Agreement.
Research Contract and License Agreement between the Company and RP Ag Co.,
substantially in the form of Exhibit F to this LLC Agreement.
Assignment and Assumption Agreement and ▇▇▇▇ of Sale between the Company and
ACTTAG, Inc., substantially in the form of Exhibit C to this LLC Agreement.
Research, License and Option Agreement dated as of October 23, 1998, by and
between The Salk Institute for Biological Sciences and Agritope, as amended, and
as assigned by Agritope to ACTTAG, Inc. and by ACTTAG, Inc. to the Company.
Research and Option to License Agreement dated as of January 21, 1999, by and
between the University Court of the University of Edinburgh and Agritope, as
assigned by Agritope to ACTTAG, Inc. and by ACTTAG, Inc. to the Company.
AGRINOMICS LLC 4 Limited Liability Company Agreement
