HomeMy WebLinkAboutCC - LLLP Agreement of Lynx Investments Limited Liability Limited Partnership Agreement of
Lynx Investments, LLLP
an Idaho Limited Liability Limited Partnership
THE OWNERSHIP INTERESTS REPRESENTED BY THIS LIMITED LIABILITY LIMITED
PARTNERSHIP AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY OTHER
APPLICABLE SECURITIES LAWS. SUCH INTERESTS MAY NOT BE SOLD, ASSIGNED,
PLEDGED OR OTHERWISE DISPOSED OF AT ANY TIME WITHOUT EFFECTIVE
REGISTRATION UNDER SUCH ACT AND LAWS OR EXEMPTION THEREFROM, AND
COMPLIANCE WITH THE OTHER SUBSTANTIAL RESTRICTIONS ON
TRANSFERABILITY SET FORTH HEREIN.
This Limited Liability Limited Partnership Agreement of Lynx Investments,LLLP,
an Idaho limited liability limited partnership, dated and effective as of July 1, 2018, is adopted by
and entered into by and among those Persons listed on Schedule A hereto as Partners.
WHEREAS, the parties previously were partners of Lynx Investments, L.P., a
California limited partnership ("Lynx Investments");
WHEREAS, on July 1, 2018, the parties caused Lynx Investments to convert to
Lynx Investments,LLLP(hereinafter sometimes referred to as the"Partnership"),an Idaho limited
liability limited partnership, pursuant t❑ California Corporations Code Section 15911.01 et seq.
and Idaho Code Section 30-22-401 et seq.; and
WHEREAS, pursuant to such conversion, the Partners wish to form a limited
liability limited partnership pursuant to the Act by filing a Certificate of Limited Partnership
("Certificate") and by entering into this Agreement.
NOW THEREFORE, in consideration of the mutual covenants and agreements
herein made and intending to be legally bound, the Partners hereby agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
1.01 Definitions. The definitions set forth in Appendix A hereto shall be applied
to the terms used in this Agreement for all purposes, unless ❑therwise clearly indicated to the
contrary.
1.02 Construction. Whenever the context requires,the gender of all words used
in this Agreement includes the masculine, feminine and neuter, and the singular number includes
the plural number and vice versa. Unless expressly provided otherwise or unless the context
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requires otherwise, all references to Articles and Sections refer to articles and sections of this
Agreement, and all references to Schedules and Appendices are to schedules and appendices
attached hereto,each of which is made a part hereof for all purposes.
1.03 Including. Reference in this Agreement to "including," "includes" and
"include" shall be deemed to be followed by "without limitation."
ARTICLE 2
ORGANIZATIONAL MATTERS
2.01 Organization of Partnership. The Partnership was formed by the filing of
the Certificate. The term of the Partnership commenced upon the filing of the Certificate and shall
continue in perpetuity or until earlier termination of the Partnership according to Article 13.
2.02 Name. The business of the Partnership shall be conducted under the name
"Lynx Investments, LLLP" or such other name or names as the General Partner shall designate in
writing to the Partners.
2.03 Purpose and Business. The Partnership was created to acquire, buy, sell,
develop, improve, maintain, lease, invest in, operate, and manage property, including but not
limited to real property,securities and other assets. The Partnership may also engage in any lawful
act or activity for which limited liability limited partnerships may be organized under the Act.
2.04 Principal Office. The principal office of the Partnership shall be at such
place as the General Partner may designate from time to time. The General Partner may change
the principal office to such other place as the General Partner designates from time to time, which
need not be in the State of Idaho, in which case the General Partner shall promptly notify the
Owners of any change to the address of the principal office. The Partnership may also have such
other offices as the General Partner may designate from time to time.
2.05 Registered Agent. The registered agent of the Partnership in the State of
Idaho shall be the registered agent named in the Certificate of Limited Partnership or such other
Person or Persons as the General Partner may designate from time to time in the manner provided
by law.
2.06 Qualification in Other Jurisdictions. The General Partner may cause the
Partnership to be qualified or registered in such states as the General Partner determines to be
appropriate and shall be authorized to execute, deliver and file any certificates and documents
necessary to effect such qualification or registration, including the appointment of agents for
service of process in such jurisdiction.
2.07 Powers and Rights. In furtherance of its purpose, but subject to all of the
provisions of this Agreement, the Partnership shall have and exercise all of the powers and rights
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which can be conferred upon limited partnerships formed pursuant to the Act and may do any and
all lawful acts or things that are necessary,appropriate,incidental or convenient for the furtherance
and accomplishment of the purpose of the Partnership or for the protection and benefit of the
Partnership or the Partnership Property. The Partnership may acquire,buy,sell,develop,improve,
maintain, lease, invest in, operate, and manage such securities, real property, and other assets as
the General Partner may determine in its sole discretion. The Partnership may pursue these
activities through the direct ownership of some or all such property, indirectly through the
ownership of interests in joint ventures,corporations,partnerships,or other entities(without regard
to whether the Partnership controls any such entity), or in any other manner that the General
Partner deems appropriate.
2.08 Designated Authority. Subject to the provisions of this Agreement, the
General Partner may authorize any Person(including any Partner, manager or officer)to enter into
and perform any obligation imposed by any document on behalf of the Partnership.
2.09 Treatment As Partnership. Unless the Partnership is treated as having a
single owner for federal income tax purposes, the Partners intend that the Partnership shall be
treated as a partnership for federal and, if applicable, state income tax purposes, and each Owner
and the Partnership shall file all tax returns and shall otherwise take all tax and financial reporting
positions in a manner consistent with such treatment.
During any time the Partnership is disregarded for federal income tax purposes pursuant
to Treasury Regulation Section 301.7701-3, all provisions that refer to sections of the Code and
regulations thereunder shall be construed as if the Partnership was classified as a partnership for
federal income tax purposes.
ARTICLE 3
CAPITAL CONTRIBUTIONS; ADJUSTMENT OF PERCENTAGE INTERESTS;
CAPITAL ACCOUNTS
3.01 Capital Contributions, The Partners have made Capital Contributions to
the Partnership in the amounts and of the assets as specified in the Partnership's records.
3.02 Admission of Additional Limited Partners; Additional Capital
Contributions.
(a) The General Partner may, in the General Partner's sole discretion, (i) admit
a Person to the Partnership as an additional Partner or Owner, (ii)offer the Owners the opportunity
to make additional Capital Contributions to the Partnership and (iii) require the Owners, equally
or disproportionately, to make additional Capital Contributions to the Partnership ("Required
Capital Contribution"), In each case, the General Partner shall modify the books and records of
the Partnership to accurately reflect each Owner's aggregate Capital Contribution and Ownership
Interest and shall adjust the Owners' Percentage Interests for purposes of allocating Profits and
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Losses as provided in Section 4.02. Acquisition or acceptance of an Ownership Interest by an
additional Owner pursuant to this Agreement shall constitute an agreement by the additional
Owner to be bound by the terms and conditions of this Agreement and, additionally, an agreement
to execute,upon the General Partner's request, a written undertaking to be bound by the terms and
conditions of this Agreement and such other documents and instruments as the General Partner
determines to be necessary or appropriate in connection with the issuance of such Ownership
Interest to such Person; and in connection with and as a condition of such issuance of such
Ownership Interest, the General Partner may require that such Person's spouse, if any, execute an
"Agreement of Spouse" in the form attached hereto as Schedule B. In no case shall the General
Partner be required to admit any Person as a Partner. Until the General Partner admits an Assignee
as a Partner, such Assignee shall have no rights as a Partner under this Agreement.
(b) In the event any Owner fails to make a Required Capital Contribution
pursuant to Section 3.02(a), such Owner shall be a"Delinquent Owner" and shall be in breach of
this Agreement. The General Partner shall give the Delinquent Owner a notice of the failure to
meet such Delinquent Owner's Commitment. Any Required Capital Contribution that is not made
within ten (10) days after required shall bear interest at the Prime Rate plus five (5) percentage
points per annum (but not in excess of the highest rate per annum permitted by law), compounded
monthly, from the date required until such Required Capital Contribution and all accrued interest
are delivered in full to the Partnership by the Delinquent Owner; provided, however, that if any
Delinquent Owner Loan(s), as defined in Section 3.02(c)below, is (are) made, all accrued interest
shall remain a separate obligation of the Delinquent Owner to the Partnership due on demand by
the General Partner. A Delinquent Owner shall pay all attorneys' fees and other costs incurred by
the Partnership to collect any amounts due under this Section 3.02.
(c) If any Delinquent Owner does not make a Required Capital Contribution
when due, one or more Partners other than the Delinquent Owner(the"Lending Partner(s)") may,
but shall not be obligated to,loan to the Delinquent Owner an amount equal to the Required Capital
Contribution of such Delinquent Owner(the "Delinquent Owner Loans)"). If more than one (1)
Lending Partner makes the Delinquent Owner Loan(s), the Lending Partners will make the loan(s)
in proportion to their Percentage Interest unless otherwise agreed in writing by the Lending
Partners. The funds for the Delinquent Owner Loan(s)shall be delivered by the Lending Partner(s)
to the Partnership and the Delinquent Owner shall sign and deliver a promissory note to each
Lending Partner in the form attached hereto as Exhibit A, the terms of which are incorporated
herein and shall apply to each Delinquent Owner Loan, for the portion of the Delinquent Owner
Loan(s) made by such Lending Partner(the "Delinquent Owner Note(s)"). If a Delinquent Owner
does not sign and deliver the Delinquent Owner Note(s) as provided above, such Delinquent
Owner shall nevertheless be deemed to have signed and delivered the Delinquent Owner Note(s)
and shall be subject to the same obligations and liabilities to the Lending Partner(s) as provided
therein. Each Delinquent Owner Loan shall bear interest at the Prime Rate plus five(5)percentage
points per annum (but not in excess of the highest rate per annum permitted by law), compounded
monthly, from the date delivered (or deemed delivered) and shall be payable in full ninety (90)
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days after the date the Delinquent Owner funds are delivered by the Lending Partner to the
Partnership.
If the Delinquent Owner does not pay the Delinquent Owner Loan(s) in full, including all
principal and accrued interest, when due,each Lending Partner thereafter shall have the option, in
the Lending Partner's sole discretion,to pursue collection against the Delinquent Owner for default
in accordance with the terms of the Delinquent Owner Note payable to such Lending Partner or to
elect to convert the Delinquent Owner Loan obligation to Percentage Interests of the Delinquent
❑wner (the "Converted Percentage Interests") and have the Converted Percentage Interests
transferred from the Delinquent Owner to such Lending Partner on the books and records of the
Partnership effective as of the date written notice of such election is delivered to the Partnership
(the "Conversion Election Date"). The Converted Percentage Interests shall consist of (i) an
increase in the Capital Account of the Lending Partner and a decrease in the Capital Account of
the Delinquent Owner of an amount in each case equal to the original principal amount of the
applicable Delinquent Owner Loan and (ii) an increase in the Percentage Interest of the Lending
Partner and decrease in the Percentage Interest of the Delinquent Owner.
(d) Except as otherwise provided in this Section 3.02, if additional Capital
Contributions are not made in proportion to each Owner's Percentage Interest or if a Person who
was not an Owner makes a Capital Contribution for an Ownership Interest,the Owners' Percentage
Interest shall be adjusted by the General Partner by taking into account the Fair Market Value of
each Owner's proportionate share of the Partnership's Property less its liabilities before the
additional Capital Contributions (calculated by the General Partner by taking into account the Fair
Market Value of the Partnership's Property less its liabilities as of the most recent practicable date
prior to the additional Capital Contributions) and the amount of each Owner's additional Capital
Contribution(including property at Fair Market Value if a contribution of property is permitted by
the General Partner), i.e., each Owner's new Percentage Interest will be (i) the product of the
Owner's Percentage Interest multiplied by the Fair Market Value of the Partnership's Property less
its liabilities (computed as set forth above) before the additional Capital Contributions, with such
product increased by the Fair Market Value of such Owner's additional Capital Contribution
divided by(ii)the sum of the Fair Market Value of all the Partnership's Property(less its liabilities)
before the additional Capital Contributions (computed as set forth above) plus the aggregate Fair
Market Value ❑f the additional Capital Contributions made by any person at the time of such
Capital Contribution.
3.03 Capital Account. The Partnership shall maintain a separate Capital
Account for each Owner according to Article 4 and the rules promulgated by the Internal Revenue
Service regarding maintenance of capital accounts (as currently provided in Treasury Regulation
Section 1.704-1(b)(2)(iv)). For this purpose, the Partnership shall, unless otherwise determined
by the General Partner in the General Partner's sole discretion, upon the occurrence of certain
events which permit a revaluation of Partnership Property (as currently provided in Treasury
Regulation Section 1.704-1(b)(2)(iv)(f)), adjust the Capital Accounts in accordance with the
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applicable rules and regulations (as currently provided in Treasury Regulation
Section 1.704-1(b)(2)(iv)(g)) to reflect a revaluation of Partnership Property.
ARTICLE 4
DISTRIBUTIONS; ADJUSTMENT OF PERCENTAGE INTERESTS;ALLOCATION
OF PROFITS AND LOSSES
4.01 Distributions;Adjustment of Percentage Interests.
(a) Taking into account the reasonable needs of the Partnership's business and
such other facts and circumstances as the General Partner shall deem pertinent, Distributions may
be made to each Owner at such times and in such amounts as the General Partner determines in
the General Partner's sole discretion.
(b) If Distributions are not made in proportion to each Owner's Percentage
Interest, the Owners' Percentage Interests shall be adjusted by the General Partner, in the General
Partner's sole discretion, for all purposes,including but not limited to allocating Profits and Losses
as provided in Section 4.02; provided, however, no Distribution shall be made to an Owner to the
extent the Distribution would, or could reasonably be expected to, cause (or increase the amount
of) an Adjusted Capital Account Deficit in such Owner's Capital Account.
4.02 Allocations of Profits and Losses. Except as otherwise provided in
Section 4.03, Profits and Losses for any fiscal period shall be allocated among the Owners in such
a manner that,as of the end of such fiscal period,the sum of(i)the Capital Account of each Owner,
(ii) such Owner's share of Partnership Minimum Gain and(iii)such Owner's Partner Nonrecourse
Debt Minimum Gain shall be equal to the respective net amounts, positive or negative, which
would be distributed to them or for which they would be liable to the Partnership under the Act,
determined as if the Partnership were to (i) liquidate the Partnership Property for an amount equal
to its Book Value and (ii) distribute the proceeds of liquidation pursuant to Section 13.03.
4.03 Regulatory and Special Allocations. Notwithstanding the provisions of
Section 4.02:
(a) If there is a net decrease in Partnership Minimum Gain during any Taxable
Year, each Owner shall be specially allocated items of Partnership income and gain for such
Taxable Year(and if necessary, subsequent Taxable Years) equal to such Owner's share of the net
decrease in Partnership Minimum Gain, determined in accordance with Treasury Regulation
Section 1.704-2(g). The items to be so allocated shall be determined in accordance with Treasury
Regulation Sections 1.704-2(f)(6)and 1.704-20)(2). This Section 4.03 is intended to comply with
the minimum gain chargeback requirement in Treasury Regulation Section 1.704-2(f) and shall be
interpreted consistently therewith.
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(b) Except as otherwise provided in Treasury Regulation Section 1.704-2(i)(4),
if there is a net decrease in Partner Nonrecourse Debt Minimum Gain attributable to a Partner
Nonrecourse Debt during any Taxable Year, each Owner who has a share of the Partner
Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt, determined in
accordance with Treasury Regulation Section 1.704-2(i)(5), shall be specially allocated items of
Partnership income and gain for such Taxable Year(and, if necessary, subsequent Taxable Years)
in an amount equal to such Owner's share of the net decrease in Partner Nonrecourse Debt
Minimum Gain attributable to such Partner Nonrecourse Debt as determined in accordance with
Treasury Regulation 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 Owner pursuant
thereto. The items to be allocated shall be determined in accordance with Treasury Regulation
Sections 1.704-2(i)(4) and 1.704-20)(2). This Section 4.03(b) is intended to qualify with the
Partner Nonrecourse Debt Minimum Gain chargeback requirement of Treasury Regulation
Section 1.704-2(i) and shall be interpreted consistently therewith.
(c) Any Nonrecourse Deductions for any Taxable Year shall be allocated to the
Owners in proportion to their respective Percentage Interests. Any Partner Nonrecourse
Deductions for any Taxable Year shall be specially allocated to the Owner(s) who bear(s) the
economic risk of loss with respect to the Partner Nonrecourse Debt to which such Partner
Nonrecourse Deductions are attributable in accordance with Treasury Regulation
Section 1.704-2(i).
(d) If any Owner unexpectedly receives any adjustments, allocations or
distributions described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of
Partnership income and gain shall be specially allocated to such Owner in an amount and manner
sufficient to eliminate the Adjusted Capital Account Deficit created by such adjustments,
allocations or distributions as quickly as possible. This Section 4.03(d) is intended to comply with
the qualified income offset requirement in Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and
shall be interpreted consistently therewith.
(e) The allocations set forth in Sections 4.03(a), (b), (c) and (d) above (the
"Regulatory Allocations") are intended to comply with certain requirements of the Treasury
Regulations under Code Section 704. It is the intent of the Owners that, to the extent possible,the
Regulatory Allocations shall be offset either with other Regulatory Allocations or with special
allocations of other items of Partnership Profits or Losses pursuant to this Section 4.03(e).
Therefore, notwithstanding any other provision of this Article 4 (other than the Regulatory
Allocations),the General Partner is authorized to make offsetting special allocations of Partnership
Profits or Losses in whatever manner they deem appropriate so that, after such offsetting
allocations are made, each Owner's Capital Account balance is,to the extent possible,equal to the
Capital Account balance such Owner would have had if the Regulatory Allocations were not part
of this Agreement and all Partnership Profits and Losses were allocated pursuant to Section 4.02.
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4.04 Tax Allocations.
(a) Except as otherwise provided in this Section 4.04, the income, gains,
deductions and losses of the Partnership shall be allocated, for federal, state and local income tax
purposes, among the Owners in accordance with the allocation of such income, gains, deductions
and losses among the Owners for computing their Capital Accounts, provided that if any such
allocation is not permitted by the Code or by other applicable law, the subsequent income, gains,
deductions and losses of the Partnership shall be allocated among the Owners for tax purposes to
the extent permitted by the Code and other applicable law so as to reflect as nearly as possible the
allocation set forth herein in computing their Capital Accounts.
(b) In accordance with Code Section 704(c) and the Treasury Regulations
thereunder,income,gain,deduction and loss with respect to any property contributed to the capital
of the Partnership shall, solely for tax purposes, be allocated among the Owners so as to take
account of any variation between the adjusted basis of such property to the Partnership for federal
income tax purposes and its Fair Market Value at the time of contribution under any method
permitted under Treasury Regulation Section 1.704-3, as determined by the General Partner.
(c) If the Book Value of any Partnership Property is adjusted pursuant to
Treasury Regulation Section 1.704-1(b)(2)(iv)(f), subsequent allocations of items of taxable
income, gain, deduction and loss with respect to such Partnership Property shall take account of
any variation between the adjusted basis of such Partnership Property for federal income tax
purposes and its Book Value in a manner permitted by Code Section 704(c) and determined by the
General Partner.
(d) Tax credits, tax credit recapture, and any items related thereto shall be
allocated to the Owner s according to their interests in such items as determined by the General
Partner taking into account the principles of Treasury Regulation Section 1.704-1(b)(4)(ii)
and (viii).
(e) Any elections or other decisions relating to allocations pursuant to this
Section 4.04 shall be made by the General Partner in any manner that reasonably reflects the
purpose and intent of this Agreement. Allocations pursuant to this Section 4.04 are solely for
purposes of federal, state and local taxes and shall not affect, or in any way be taken into account
in computing,any Owner's Capital Account or share of Profits,Losses,other items or distributions
pursuant to any provisions of this Agreement.
4.05 Indemnification and Reimbursement for Payments on Behalf of an
Owner.
(a) If the Partnership is required to pay any amount to a governmental agency
(or otherwise makes a payment) because of an Owner's status or that is specifically attributable to
an Owner (including federal, state or local withholding taxes imposed with respect to foreign
Lynx Investme►rts, LLLP Page 8
Persons, state personal property taxes, state unincorporated business taxes, etc.), then such Owner
(the "Indemnifying Owner") shall indemnify the Partnership in full for the entire amount paid
(including any interest, penalties and expenses associated with such payment). The amount to be
indemnified shall be charged against the Capital Account of the Indemnifying Owner, and, at the
option of the General Partner, either:
(i) promptly upon notification of an obligation to indemnify the
Partnership, the Indemnifying Owner shall make a cash payment to the Partnership equal to the
full amount to be indemnified (and the amount paid shall increase the Indemnifying Owner's
Capital Account,but shall not be treated as a Capital Contribution hereunder), or
(ii) the Partnership shall make Distributions to the Indemnifying Owner
net of the governmental payments or reduce subsequent Distributions that would otherwise be
made to the Indemnifying Owner until the Partnership has recovered the amount to be indemnified
(and the amount of such reduction shall be deemed to have been distributed to the Indemnifying
Owner for all purposes of this Agreement, but such deemed distribution shall not further reduce
the Indemnifying Owner's Capital Account).
(b) An Owner's obligation to make contributions to the Partnership under this
Section 4.05 shall survive the termination, dissolution, liquidation, and winding up of the
Partnership, and, for purposes of this Section 4.05, the Partnership shall be treated as continuing
in existence. The Partnership may pursue and enforce all rights and remedies it may have against
each Owner under this Section 4.05, including instituting a lawsuit to collect such contribution
with interest calculated at the Prime Rate plus five (5) percentage points per annum (but not in
excess of the highest rate per annum permitted by law).
4.06 Distribution in Kind. If the General Partner determines to make a
Distribution, an Owner has no right to demand or receive any distribution from the Partnership in
any form other than cash. An Owner may not be compelled to accept a distribution in kind of any
Partnership Property to the extent that the percentage of the Partnership Property distributed to
such Owner would exceed such Owner's Percentage Interest.
ARTICLE 5
MANAGEMENT
5.01 Authority of the General Partner. Except as may be expressly provided in
this Agreement, the General Partner shall have all the rights and powers of a general partner- as
provided in the Act, under any other applicable laws, and by this Agreement. Except as may be
expressly limited by the Act, such other applicable law or by this Agreement, the General Partner
shall have the exclusive right and power to manage the business of the Partnership and is
authorized to do on behalf of the Partnership all things which, in the General Partner's sole
judgment, are necessary or appropriate to carry out the Partnership's purposes. Without limiting
the foregoing, the General Partner shall have the power to (a) enter into agreements, and execute
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documents and instruments, including brokerage and investment advisor agreements, leases,
mortgages, evidences of indebtedness, construction, development, management, and other
contracts; (b) borrow money, and open and maintain bank accounts authorizing withdrawals on
the signature of such one or more Persons as the General Partner may designate; (c) sell or assign
any or all Partnership Property; (d) execute such other documents and take such other actions as
may be necessary or desirable from time to time to carry out any purpose authorized pursuant to
this Agreement; and (e) make a loan to any Owner, which such loan shall not be treated as a
Distribution from the Partnership but as a debt due to the Partnership bearing interest at the rate
agreed between the Partnership and the borrowing Owner. Decisions or actions taken by the
General Partner in accordance with the provisions of this Agreement shall constitute decisions or
actions by the Partnership and shall be binding on each Owner, manager, officer and employee of
the Partnership.
5.02 Manner of Action by General Partner. During any period in which there
is more than one(1)General Partner,the following provisions shall be applicable where the context
admits:
(a) Each General Partner who proposes that the Partnership act or refrain from
acting (the "Recommending GP") shall seek approval of such proposal from the other General
Partner(s) (each a "Deliberating GP"). Failure of a Deliberating GP to indicate, as directed by the
Recommending GP, approval or disapproval of a proposal within fifteen (15) days after receipt
thereof, shall constitute a vote in favor of the proposal.
(b) No action, except for day-to-day administrative matters, shall be taken by a
General Partner except pursuant to a vote in favor of such action by a majority of the General
Partners. A decision made by a majority of the General Partners who are qualified to vote on such
decision shall control, and no General Partner who dissents in writing shall be liable for such
decision.
(c) Unless the General Partners elect otherwise in writing, any General Partner
may sign any checks, agreements or other documents on behalf of the Partnership and such
signature shall bind the Partnership in the same manner as though said check, agreement or other
document had been signed by all of the General Partners acting in the same capacity,and no Person
or entity dealing with the signing General Partner shall be obligated to inquire as to any other
General Partner's acquiescence to such action.
(d) The General Partners may execute any instrument or document by signing
one instrument or document or counterpart instruments or documents, all of which counterparts
shall together constitute one instrument or document.
(e) The General Partners may carry out their duties, communicate with each
other, participate in meetings and/or votes via electronic mail, telephone (individual calls or
conference calls), facsimile or other communications equipment.
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5.03 Reliance by Third Parties. Any person dealing with the Partnership shall
be entitled to deal with the General Partner as if he or she were the sole party in interest in the
Partnership's property, both legally and beneficially. Each Owner hereby waives any and all
defenses or other remedies that may be available against such person to contest, negate, or
disaffirm any action taken in good faith by the General Partner that relates to the Partnership's
property. Every agreement, instrument, or document executed by the General Partner with respect
to any business or property of the Partnership shall be conclusive evidence in favor of any person
relying thereon or claiming thereunder that (i) at the time of the execution or delivery thereof this
Agreement was in full force and effect, (ii) such agreement, instrument, or document was duly
executed according to this Agreement and is binding upon the Partnership, and (iii) the General
Partner was duly authorized and empowered to execute and deliver such agreement, instrument,
or document for and on behalf of the Partnership.
5.04 Compensation and Reimbursement of a Genera[Partner.
(a) A General Partner may receive reasonable compensation for its services to
the Partnership.
(b) In addition, each General Partner may be reimbursed for all reasonable
amounts paid or incurred in organizing or conducting the Partnership's business, including that
portion of such General Partner's reasonable legal and accounting expenses, telephone,secretarial,
travel expenses, office rent and other office expenses, salaries and other compensation expenses
of employees, and other indirect expenses necessary or appropriate in organizing or conducting
the Partnership's business that is properly allocable to the Partnership. The General Partner shall
determine the portion of the indirect expenses that is allocable to the Partnership in any reasonable
manner.
5.05 Dealings With a General Partner. The General Partner or any of its
Affiliates may contract or otherwise deal with the Partnership, provided that the terms of any such
contract or dealing shall be fair and reasonable to the Partnership.
5.06 Insurance on General Partner-s Life. With respect to any insurance on
the life of a General Partner, (a) such General Partner has no power to participate in any decision-
making by the Partnership with respect to such life insurance (including whether- to purchase or
sell such life insurance, whether or not to pay premiums thereon, beneficiary designation, and any
other power covered by Section 2042 of the Code), (b) any such decision shall be made by the
other General Partner, or if there is no other General Partner then by Limited Partners awning a
majority of the Percentage Interests owned by the Limited Partners other than Percentage Interests
owned (including as trustee or other fiduciary) by such General Partner, and (c) ante such a
decision has been made, any Partner is authorized to implement such decision (including paying,
on behalf of the Partnership, premiums or other expenses incurred to implement such decision and
signing implementing documents).
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5.07 Outside Activities.
(a) The General Partners, their respective Affiliates, and their respective
stockholders,directors,managers,officers,controlling Persons,partners,and employees may have
business interests and engage in business activities in addition to those relating to the Partnership,
including business interests and activities that compete with the Partnership. Neither the
Partnership nor any Partner shall have any rights by virtue of this Agreement in any business
interests or activities of any General Partner or their respective Affiliates. Each General Partner
shall devote to the management of the Partnership such time as it determines is necessary or
appropriate to cause the affairs of the Partnership to be conducted in an efficient and businesslike
manner.
(b) Neither any General Partner nor any Affiliate of a General Partner shall be
obligated to present any particular investment or business opportunity to the Partnership even if
the opportunity is of a character which, if presented to the Partnership, could be undertaken by the
Partnership. Each General Partner and its Affiliates shall have the right to undertake any such
opportunity for itself or for its own account or on behalf of another or to recommend any such
opportunity to others.
5.08 Successor General Partners. If at any time there is no General Partner or
if the General Partner is incapacitated,the Limited Partners shall select a successor General Partner
by consent of Partners possessing a majority of the Limited Partner Percentage Interests.
ARTICLE 6
RIGHTS AND OBLIGATIONS OF PARTNERS
6.01 Management of Business. Except as otherwise expressly provided herein,
no Partner or other Owner shall have any voting rights in the Partnership,or participate in or have
any control over the management of the Partnership or the Partnership's business and affairs, and
shall not have any power or authority to act for or bind the Partnership unless (a) such Person is
acting within its authority as General Partner,or(b) such Person is employed or engaged to transact
any such business by or on behalf of a General Partner or the Partnership. The transaction of any
such business by a Partner employed or engaged to do so by or on behalf of a General Partner or
the Partnership shall not be deemed to constitute participation in control of the Partnership and
shall not affect, impair, or eliminate the limitations on the liability of a Partner under this
Agreement.
6.02 Consent. Where this Agreement permits or requires action by or approval
of the Limited Partners, except as expressly provided herein, any such action or approval shall
require a vote in favor thereof by the Limited Partners representing a majority of the Percentage
Interests owned by the Limited Partners. For purposes of the preceding sentence,a Limited Partner
who is prohibited from participating in any such action pursuant to this Agreement, by law or
Lynx Investments, LLLP Page 12
otherwise, shall be treated as not being a Limited Partner in determining the Percentage Interests
owned by each other Limited Partner.
6.03 No Right of Partition. No Partner or other Owner shall have the right to
seek or obtain partition by court decree or operation of law of any Partnership Property, or the
right to own or use particular or individual Partnership Property.
6.04 Outside Activities. A Partner may have business interests and engage in
business activities in addition to those relating to the Partnership, including business interests and
activities that compete with the Partnership. Neither the Partnership nor any Partner shall have
any rights by virtue of this Agreement in any business interests or activities of any other Partner.
6.05 Access to litfarfnation. In addition to the right to receive the information
to be provided pursuant to Section 7.02,each Partner shall have the right,upon reasonable demand
and for any purpose reasonably related to its Ownership Interest, to obtain such information
regarding the Partnership's affairs as is specified in the Act.
6.06 Transactions with the Partnership. Notwithstanding that it may constitute
a conflict of interest, the Partners or their Affiliates may engage in any transaction (including,
without limitation, the purchase, sale, lease or exchange of any property, the lending or borrowing
of money or the rendering of any service or the establishment of any salary, other compensation
or other terms of employment) with the Partnership so long as such transaction is on arms-length
terms, as reasonably determined by the General Partner.
ARTICLE 7
RECORDS AND REPORTS
7.01 Records and Accounting. The Partnership shall maintain complete and
accurate books of account of the Partnership's affairs at the Partnership's principal office, which
books shall be kept confidential by all Owners and which books shall be open to inspection only
by any Partner (or such Person's authorized representative) for any purpose reasonably related to
such Person's investment in the Partnership at such time and at such place as reasonably
determined by the General Partner; provided that, to the maximum extent permitted by applicable
law, without the General Partner's written consent which may be withheld in its sole discretion,
no Owner shall be entitled to copy(or be provided copies of) or inspect(a)any books or schedules
of the Partnership or any other information of the Partnership other than information necessary to
verify such Person's Ownership Interest and Capital Account and (b) any books or schedules of
the Partnership or any other information of the Partnership with respect to any other Person.
7.02 Information.
(a) At the request of an Owner,the General Partner shall furnish to the Owners:
Lynx Invesrnaents, LLLP Page 13
(i) within the earlier of (A) ten (10) days after the filing of the
Partnership's federal income tax return and (B) September 15 of the following Fiscal Year, or as
soon as reasonably practicable thereafter, such Owner's Schedule K-1 for such Fiscal Year; and
(ii) such other information,if any,with respect to the Partnership as may
be necessary for the preparation of such Owner's federal, state and local income tax returns,
including a statement showing such Owner's share of Profits and Losses for such Taxable Year
for federal income tax purposes.
(b) In addition to the information described in this Section 7.02, at the
Partnership's expense, the General Partner shall furnish to each Partner information regarding
Distributions by the Partnership and compensation received by the General Partner for services to
the Partnership, as such Partner may reasonably request from time to time.
(c) The schedules and information referenced in this Section 7.02 may be
dependent upon information to be provided to the General Partner by Persons in which the
Partnership has invested. Therefore, notwithstanding the foregoing time periods, the General
Partner may furnish such schedules and information to the Owners after the expiration of such
time periods, but as soon as reasonably practicable, following receipt of all financial and other
information necessary or desirable to prepare such documents.
(d) The General Partner may, in its sole discretion, choose to furnish certain or
all of such statements and other information described in this Section 7.02 to the Owners
electronically in lieu of providing the Owners with hard copies of such statements and information.
(e) Any information obtained by an Owner with respect to the affairs of the
Partnership shall, except as may be required by law, be kept strictly confidential.
ARTICLE 8
TAX MATTERS
8.01 Preparation of Tax Returns. The General Partner shall arrange for the
preparation and timely filing of all tax returns required to be filed by the Partnership.
8.02 Tax Controversies. Subject to any requirements of the Code and Treasury
Regulations, the General Partners shall designate one (1) person to be the "partnership
representative" (as defined in Code Section 6223), and the General Partners may remove the
partnership representative for any reason. The partnership representative is authorized to represent
the Partnership before the Internal Revenue Service and any other governmental agency with
jurisdiction,and to sign such consents and to enter into settlements and other agreements with such
agencies as the partnership representative deems necessary or advisable.
Lynx Investments, LLLP Page 14
ARTICLE 9
AMENDMENTS
This Agreement may be amended or modified by a written instrument adopted by
the General Partners; provided, however, no such amendment shall reduce any Partner's rights,
including its share of Distributions and Profits, or increase any Partner's obligations, including its
share of Losses, without the consent of a majority of Percentage Interests of the adversely affected
Partners.
ARTICLE 10
TRANSFER OF OWNERSHIP INTERESTS
10.01 Transfers in General. No Owner may Transfer any part or all of its
Ownership Interest unless such Transfer is a Permitted Transfer. A Permitted Transfer means a
Transfer of an Ownership Interest:
(a) to which the General Partner have consented pursuant to Section 10.02;
(b) to a Permitted Transferee;
(c) to a Partner pursuant to such Partner's exercise of its right to purchase an
Ownership Interest pursuant to Section 10,03 or Section 10.10;
(d) to a non-Permitted Transferee (in a Testamentary Transfer, an involuntary
transfer, or a transfer by operation of law) after the Partnership and the Partners have not elected
to purchase such Ownership Interest pursuant to their right of first refusal within the requisite time
period described in Section 10.03; or
(e) to the Partnership.
Any purported Transfer of an Ownership Interest which is not a Permitted Transfer shall be null
and void, shall be of no effect and shall not bind or be recognized by the Partnership or any other
party and the purported transferee shall not become an Owner and shall have no right to any
Partnership Profits, Losses or Distributions or any other rights of an Owner.
10.02 Transfers (to Persons other than Permitted Transferees) with Consent.
An Owner may Transfer any part or all of its Ownership Interest to a Person upon such terms and
conditions as such Transferring Owner may decide, but only with the consent of the General
Partner if the Transferee is not a Permitted Transferee, which consent may be granted or withheld
in the General Partner's sole discretion. Any Transfer pursuant to this section must be completed
within six (6) months from the date of such consent, unless such consent is granted for a
Testamentary Transfer or a shorter period is specified therein.
Lynx Investments, LLL.P Page 15
10.03 Testamentary Transfer; Involuntary Transfer; Transfer by Operation of
Law.
(a) A Testamentary Transfer, an involuntary Transfer or a Transfer by
operation of law of any Ownership Interest to a Person other than a Permitted Transferee to which
the General Partner has not previously consented pursuant to Section 10.02 shall be subject to the
Partnership's and the non-Transferring Limited Partners' right to purchase all or any portion of
such Ownership Interest pursuant to Section 10.03(b); provided, however, that a Partner's or the
Partnership's rights under Section 10.03(b) may be waived in writing by such Partner or by the
Partnership with respect to a particular Transfer. Before such Ownership Interest is Transferred,
the Transferring Owner shall give the non-Transferring Partners and the Partnership written notice
describing the proposed Transfer. In the event such notice of intent is not given or is unable to be
given by the Transferring ❑wner prior to the Transfer, the Transferee of such Transferred
Ownership Interest shall, within thirty (30) days after receiving such Transferred Ownership
Interest, give the non-Transferring Partners and the Partnership written notice. In both cases, the
written notice shall contain a description of the Transferred Ownership Interest; the name, address
(both horne and office),and business or occupation of the Person to whom such Ownership Interest
would be or was Transferred; and any other facts that are or would reasonably be deemed material
to the Transfer. For purposes of this Article, all references to a notice pursuant to this
Section 10.03 shall be a reference to the first notice containing the required information received
by the Partners, whether such notice is from the Transferor or the Transferee of a Transferred
Ownership Interest.
(b) After the notice required by Section 10.03(a) or Section 10.10 containing
the required information (the "Required Notice") has been given, the Partnership and the non-
Transferring Limited Partners shall have the right to purchase all or any portion of the Transferred
Ownership Interest as provided herein:
(i) The Partnership may elect to purchase all or any portion of the
Transferred Ownership Interest for the Fair Market Value (as of the date of the event giving rise
to the Transfer to which this Section 10.03 applies) of such Transferred Ownership Interest, by
giving written notice ❑f such election (the "Election Notice") to the Transferring Owner and the
non-Transferring Limited Partners within thirty(30)days after the Required Notice has been given
to the Partnership.
(ii) If the Partnership has not elected to purchase all ❑f the Transferred
Ownership Interest within thirty (30) calendar days after the Required Notice has been given to
the Partnership,each non-Transferring Limited Partner may elect to purchase all or any portion of
its pro rata portion of the Transferred Ownership Interest the Partnership has not elected to
purchase (derived from a fraction the numerator of which is such non-Transferring Limited
Partner's Percentage Interest and the denominator of which is the sum of the Percentage Interests
of all non-Transferring Limited Partners) for the Fair Market Value (as of the date of the event
giving rise to the Transfer to which this Section 10.03 applies) of such portion of the Transferred
Lvnx Investments, LLLP Page 16
Ownership Interest,by giving written notice of such election(the"Supplemental Election Notice")
to the Transferring Owner within twenty(20) days after transmittal of the Election Notice,or if no
Election Notice has been given, within fifty (50) days after the Required Notice has been given to
the Partnership. Any portion of the Transferred Ownership Interest not elected to be purchased at
the end of such 20-day or 50-day period shall be reoffered by the Transferring Owner on a pro rata
basis to each non-Transferring Limited Partner that has elected to purchase its pro rata share of the
Transferred Ownership Interest each twenty (20) days until the earlier to occur of(A) all of such
Transferred Ownership Interest is acquired or (B) no non-Transferring Limited Partner wishes to
purchase any further interest.
(iii) If the Partnership and/or the non-Transferring Limited Partners have
elected to purchase all or any portion of the Transferred Ownership Interest from the Transferring
Owner, such purchase shall be consummated as soon as practicable after the foregoing process is
completed.
(c) If the Partnership and/or the non-Transferring Limited Partners exercise
their right of first refusal to purchase all or any of the Transferred Ownership Interest pursuant to
Section 10.03(a), such purchase price shall be paid at each buyer's option either(A) the mid-term
Applicable Federal Rate, compounded annually, with interest payable in annual installments and
the entire balance of the unpaid principal and accrued interest payable in a single "balloon"
payment on or before the date that is nine (9) years after the date of closing; or (B) the Ion.--term
Applicable Federal Rate, compounded annually, with interest payable in annual installments and
the entire balance of the unpaid principal and accrued interest payable in a single "balloon"
payment on or before the date that is twenty (20) years after the date of closing. As applicable,
each buyer shall give the Transferring Owner a promissory note as evidence of this debt. Any part
or all of the remaining balance of the obligation under the note may be prepaid at any time without
penalty or premium.
10.04 Complete Transfer of Ownership Interest. A Partner ceases to be a Limited
Partner hereunder upon the Transfer of all of its Ownership Interest.
10.05 Transfers Expressed in Percentage Interest. All Transfers of Ownership
Interests shall be expressed in terms of a Percentage Interest.
10.06 Transfer Fees and Expenses. The Transferor and Transferee of any
Ownership Interest shall be jointly and severally obligated to reimburse the Partnership for all
reasonable expenses (including attorneys' fees and expenses)of any Transfer or proposed Transfer
of such Ownership Interest, whether or not consummated.
10.07 Other Limitations. In order to permit the Partnership to qualify for the
benefit of a "safe harbor" under Code Section 7704, notwithstanding anything to the contrary in
this Agreement, no Transfer shall be permitted or recognized (within the meaning of Treasury
Regulation Section 1.7704-1(d)) by the Partnership or the Owners if and to the extent that such
Lynx Investments, LLLP Purge 17
Transfer would cause the Partnership to have more than one hundred (100) partners (within the
meaning of Treasury Regulation Section 1.7704-1(h), including the look-through rule in Treasury
Regulation Section 1.7704-1(h)(3)), unless the General Partner has first consulted with legal
counsel and determined that such Transfer would not cause the Partnership to be deemed to be a
publicly traded partnership.
10.08 Effective Date. Any Transfer and any related admission of a Person as a
Partner in compliance with this Article 1❑ shall be deemed effective on such date that the
Transferee or successor-in-interest complies with the requirements of this Agreement.
10.09 Owners of Record. The Partnership shall be entitled to treat a record Owner
of any Ownership Interest as the absolute owner thereof and shall incur no liability for distributions
of cash or other property made in good faith to such Owner until such time as a Transfer of such
Ownership Interest is made pursuant to the terms and conditions of this Article 10 and has been
recorded on the books of the Partnership.
10.10 Spouse as Owner.
(a) An Owner shall be a "spouse-Owner" for purposes of this Section if:
(i) such Owner is a spouse of a descendant of Gregory T. Huarte and
Laurie J. Huarte and either party to the marriage files a petition for legal separation or for
dissolution of marriage, or
(ii) such Owner was a spouse of a descendant of Gregory T. Huarte and
Laurie J. Huarte until the death of the descendant of Gregory T. Huarte and Laurie J. Huarte to
whom such spouse was married and such Owner has remarried.
(b) The spouse-Owner shall give the Partnership and the other Partners written
notice of the event triggering spouse-Owner status within ninety(90)days of such event,but failure
to provide such notice within ninety (90) days shall not prejudice the Partnership's and the other
Partners' rights pursuant to this Section.
(c) The Partnership and the Limited Partners who are not spouse-Owners shall
have an ongoing and continuous right to purchase all or any portion of any spouse-Owner's
Ownership Interest in the manner set forth in Section 10.03(b) and (c). For such purpose, (i) the
spouse-Owner shall be considered a Transferring Owner, (ii) the spouse-Owner's Ownership
Interest shall be considered a Transferred Ownership Interest, (iii) the Required Notice shalt be
deemed given any time the Partnership or any other Limited Partner gives to the spouse-Owner,
the Partnership and all other Partners a written notice of intent to purchase the spouse-Owner's
Ownership Interest, and (iv) the Fair Market Value ❑f such interest shall be determined as of the
written notice date. Such notice may be given more than once, at any time and from time to time.
LYnX Investments, LLLP Page 18
ARTICLE 11
ADMISSION OF PARTNERS; EFFECT OF TRANSFERS
11.01 Effect of Transfer. Following a Permitted Transfer:
(a) The Transferee shall be treated as having, made all of the Capital
Contributions in respect of, and received all of the Distributions in respect of, such Transferred
Ownership Interest, shall succeed to the Capital Account associated with such Transferred
Ownership Interest, and shall receive Distributions and allocations of Profits and Losses pursuant
to Article 4 and Article 13 in respect of such Transferred Ownership Interest.
(b) Profits, Losses and other items or Distributions shall be allocated between
the Transferor and the Transferee according to Code Section 706, with Distributions made before
the effective date of such Transfer paid to the Transferor, and Distributions made after such date
paid to the Transferee.
(c) The Transferee of an Ownership Interest will (i) automatically become a
Limited Partner entitled to all the rights of a Limited Partner with respect to such Transferred
Ownership Interest if such Transferee is a Permitted Transferee, or (ii) become an Assignee with
respect to such Transferred Ownership Interest unless and until admitted as a Limited Partner with
respect to such Transferred Ownership Interest by the General Partner in the General Partner's sole
discretion. Until a Transferee is admitted as a Limited Partner, the last Transferor of such
Transferred Ownership Interest who was a Limited Partner with respect thereto shall retain the
right to vote such Transferred Ownership Interest.
(d) Acceptance of a Transferred Ownership Interest shall constitute an
agreement by the Transferee to be bound by the terms and conditions of this Agreement and to
execute, upon the General Partner's request, a written undertaking to be bound by the terms and
conditions of this Agreement and such other documents and instruments as the General Partner
determines to be necessary or appropriate in connection with the Transfer of such Ownership
Interest to such Person.
11.02 Representations of New Owners. Each Owner represents, warrants or
acknowledges, to the extent required under applicable laws, that (a) the Owner's interest in the
Partnership is intended to be and is being acquired solely for the Owner's own account for the
purpose of investment and not with a view to any sale or other disposition of all or any part thereof,
(b) the Owner is aware that interests in the Partnership have not been registered under the
Securities Act,that such interests cannot be sold or otherwise disposed of unless they are registered
thereunder or unless an exemption from such registration is available, that the Partnership has no
present intention of so registering such interests under the Securities Act, and that accordingly
such Owner is able and is prepared to bear the economic risk of making an investment in the
Partnership and to suffer a complete loss of investment, and (c) the Owner's knowledge and
experience in financial and business matters are such that the Owner is capable of evaluating the
Lynx Invesiments, LLLP Page 19
risks of making an investment in the Partnership. The foregoing representations and warranties
may be relied upon by the Partnership and by the other Owners in connection with each Owner's
investment in the Partnership.
11.03 Effect of Death or Incapacity. Except as otherwise provided herein, the
death or Incapacity of an Owner shall not dissolve or terminate the Partnership.
ARTICLE 12
DISSOCIATION OR REMOVAL OF PARTNERS
12.01 Dissociation of a General Partner. A General Partner may dissociate from
the Partnership in accordance with the provisions of Section 30-24-603 of the Act, by giving to
the Owners written notice including the effective date of the dissociation.
12.02 Dissociation of Owner. An Owner may not dissociate from the Partnership.
12.03 No Removal of Owners. No Partner or group of Partners shall have the
right to remove any other Owner of the Partnership.
ARTICLE 13
DISSOLUTION AND LIQUIDATION
13.01 Dissolution. The Partnership shall dissolve, and its affairs shall be wound
up, upon the first to occur of the following:
(a) the unanimous consent of the General Partners;
(b) an Event of Dissociation of a General Partner who is the sole General
Partner, subject to Section 13.02; or
(c) an entry of a decree of judicial dissolution under the Act (as currently
provided in Section 30-24-801 of the Act).
13.02 Election to Continue the Partnership.
(a) If there is an Event of Dissociation of a General Partner and at least one
General Partner is still acting, the business of the Partnership may continue to be carried on by the
remaining General Partners. If there is an Event of Dissociation of a General Partner and no other
General Partner is still acting, the business of the Partnership may continue to be carried on if
within two hundred seventy (270) days after such Event of Dissociation of a General Partner, the
Partners representing a majority of the Percentage Interests owned by the Partners elect to continue
the business of the Partnership and appoint,effective as of the date of the Event of Dissociation ❑f
a General Partner, one ❑r more General Partners.
Lynx hivestmews, LLLP Page 20
(b) Upon an Event of Dissociation of a General Partner, if no other General
Partner is still acting, the Liquidator shall continue to operate the Partnership's business in the
ordinary course with a view to conserving the Partnership Property during the specified period
within which a successor General Partner may be admitted.
13.03 Liquidatioit.
(a) If the Partnership is dissolved as provided above in this Article 13, the
General Partner shall serve as the "Liquidator," or if there is more than one General Partner, the
General Partners shall designate one General Partner to serve as the Liquidator, or if there is no
General Partner, the Limited Partners shall designate a Person as the Liquidator. Except as
expressly provided in this Article 13,the Liquidator shall have and may exercise all of the powers
conferred upon a General Partner under this Agreement (but subject to all of the applicable
limitations, contractual and otherwise, upon the exercise of such powers) to the extent necessary
or desirable in the good faith judgment of the Liquidator to carry out the duties and functions of
the Liquidator hereunder for and during such period of time as shall be reasonably required in the
good faith judgment of the Liquidator to complete the winding up and liquidation of the
Partnership. The Liquidator shall receive as compensation for its services (i) if the Liquidator is a
General Partner, the compensation and reimbursements specified in Section 5.04, or (ii) if the
Liquidator is not a General Partner, a reasonable fee plus reasonable out-of-pocket costs or such
other compensation as the General Partner may approve,
(b) The Liquidator may liquidate the Partnership Property, and shall apply and
distribute the proceeds of such liquidation and any uniiquidated Partnership Property, in the
following order of priority, unless otherwise required by mandatory provisions of applicable law:
0) First, to creditors, including Owners (and former Owners) who are
creditors, to the extent permitted by law, in satisfaction of liabilities of the Partnership, including
liabilities for unpaid Distributions to which any Owner (or former Owner) is then entitled under
Section 4.01 (distributions); and
(H) Second, to the Owners, in proportion to their respective Percentage
Interests.
13.04 Orderly Liguidatiora. A reasonable time shall be allowed for the orderly
liquidation of the Partnership Property and the discharge of liabilities so as to minimize the losses
normally attendant upon liquidation. The Liquidator (or the Partners) shall, however, if possible,
consistent with the preceding sentence, dispose of Partnership Property and effect distributions to
the Owners within one hundred eighty (180) days after the date of dissolution of the Partnership.
13.05 Cancellatimi of Certificate. Upon the completion of the distribution of
Partnership Property as provided in Section 13.02, the Partnership shall be terminated, and the
Lynx Investments, LLLP Page 21
Liquidator (or the Partners) shall cause the cancellation of the Certificate and all qualifications of
the Partnership as a foreign partnership in jurisdictions other than the State of Idaho.
13.06 Covenant Not to Cause Dissolution. To the extent that governing law may
empower any Owner or group of Owners to cause the dissolution of the Partnership at any time,
then, notwithstanding such provision, each Owner hereby covenants and agrees not to cause the
dissolution of the Partnership by its individual action (or to participate in any action of a group of
Owners not approved by the General Partner) pursuant to such provision and, in the event that any
Owner causes the Partnership to be dissolved, or this Agreement to be terminated, prior to the
occurrence of any event of dissolution or termination otherwise provided for herein, such Owner
shall be liable to all other Owners for all damages resulting from such dissolution or termination.
ARTICLE 14
LIABILITY AND INDEMNIFICATION OF PARTNERS AND OTHERS
14.01 Limitation of Liability for Debts, Obligations and Liabilities of the
Partnership. The Partnership is a limited liability limited partnership under the Act. Except as
otherwise provided by applicable laws, the debts, obligations and liabilities of the Partnership,
whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities
of the Partnership, and no Partner shall be obligated personally for any such debt, obligation or
liability of the Partnership solely by reason of being an Owner or Partner, and a Partner's liability
shall be limited to such Partner's undistributed Capital Contribution and share of any undistributed
net Profits; provided that an Owner shall be required to return to the Partnership any Distribution
made to it in clear and manifest accounting or similar error. The immediately preceding sentence
shall constitute a compromise to which all Owners have consented within the meaning of the Act.
Notwithstanding anything contained herein to the contrary,the failure of the Partnership to observe
any formalities or requirements relating to the exercise of its powers or management of its business
and affairs under this Agreement or the Act shall not be grounds for imposing personal liability on
the Partners for liabilities of the Partnership.
14.02 Limitations of Liability for Acts and Omissions. A General Partner shall
be liable to the Partnership for acts or omissions determined by the final decision of a court of
competent jurisdiction to have constituted gross negligence or intentional misconduct in the
management of the Partnership; but a General Partner (including, with the General Partner's
written consent, the General Partner's or the Partnership's representatives, affiliates, directors,
managers, officers, employees and agents (hereinafter collectively a "GP's representative")) shall
not be liable to the Partnership, any third party, any Owner or representative, or any manager,
officer or employee of the Partnership for any acts or omissions that do not constitute gross
negligence or intentional misconduct, including the negligence, strict liability or other fault or
responsibility (short of gross negligence or intentional misconduct) of such General Partner
(including, with the General Partner's written consent,a GP's representative); and the Partnership
shall indemnify such General Partner (including, with the General Partner's written consent, a
GP's representative) as described in Section 14.03. The General Partner may exercise any of the
Lvix hivestments, LLLP Page 22
powers granted to it by this Agreement and perform any of the duties imposed upon it hereunder
either directly or by or through its agents, and the General Partner shall not be responsible for any
misconduct or negligence on the part of any such agent appointed by the General Partner in good
faith.
14.03 Indemnification. The Partnership shall indemnify and hold harmless the
General Partner and GP's representatives (each an "Indemnified Person") from and against any
and all losses, claims, damages, liabilities, expenses (including legal fees and expenses),
judgments, fines, settlements, and other amounts relating to any and all claims, demands, actions,
suits, or proceedings, whether civil, criminal, administrative, or investigative, that relate to the
Indemnified Person's status or activities as a General Partner or GP Representative of the
Partnership or to the Partnership's property, business, or affairs; provided that (unless the other
General Partners, or if none the Limited Partners, otherwise consent) no Indemnified Person shall
be indemnified for any expenses, liabilities and losses suffered that are attributable to such
Person's gross negligence, willful misconduct or knowing violation of law, or for any present or
future breaches of any representations, warranties or covenants by such Indemnified Person
contained herein or in any other agreement with the Partnership, or for any losses incurred by the
Partnership. Expenses, including attorney fees, incurred by any such Indemnified Person in
defending a proceeding shall be paid by the Partnership in advance of the final disposition of such
proceeding, including any appeal therefrom, upon receipt of an undertaking by or on behalf of
such Indemnified Person to repay such amount if it shall ultimately be determined that such
Indemnified Person is not entitled to be indemnified by the Partnership.
The right to indemnification and the advancement of expenses shall not be exclusive of
any other right which an Indemnified Person may have or hereafter acquire under any statute,
agreement, vote of the General Partners or otherwise.
14.04 Insurance. The Partnership may maintain insurance, at its expense, to
protect any Indemnified Person against any expense, liability or loss described in Section 14.03
above whether or not the Partnership would have the power to indemnify such Indemnified Person
against such expense, liability or loss under the provisions of Section 14.03.
14.05 Payment of Indemnity. Notwithstanding anything contained herein to the
contrary (including in this Section 14.05), any indemnity by the Partnership relating to the matters
covered in this Article shall be provided out of and to the extent of Partnership assets only and no
Partner (unless such Partner-otherwise agrees in writing or is found in a final decision by a court
of competent jurisdiction to have personal liability on account thereof)shall have personal liability
on account thereof or shall be required to make additional Capital Contributions to help satisfy
such indemnity of the Partnership.
14.06 Invalidation. If this Article 14 or any portion hereof shall be invalidated on
any ground by any court of competent jurisdiction, then the Partnership shall nevertheless
indemnify and hold harmless each Indemnified Person pursuant to this Article 14 to the fullest
Lynx bivestr+ments, LLLP Page 23
extent permitted by any applicable portion of this Article 14 that shall not have been invalidated
and to the fullest extent permitted by applicable law.
ARTICLE 15
GENERAL PROVISIONS
15.01 Power of Attorney. Each Owner hereby irrevocably constitutes and admits
the General Partner and the Liquidator, with full power of substitution, as such Owner's true and
lawful agents and attorneys-in-fact, to execute, swear to, acknowledge, verify, deliver, file and
record, in the Owner's or its assignee's name,place,and stead, all in accordance with the terms of
this Agreement, all instruments, documents and certificates which may from time to time be
required by the laws of the United States, the State of Idaho, all other jurisdictions in which the
Partnership may conduct business or own property, or any political subdivision or agency thereof
to effectuate, implement and continue the valid existence of the Partnership, including the power
and authority to execute, swear to, acknowledge, verify, deliver, file and record:
(a) all certificates and other instruments, including any amendments to this
Agreement or the Certificate, which the General Partner deems appropriate or necessary to form,
qualify or continue the Partnership as a partnership in the State of Idaho and all other jurisdictions
in which the Partnership conducts or plans to conduct its affairs;
(b) any amendment, change, modification, or restatement of this Agreement in
accordance with its terms that the General Partner deems appropriate to (i) reflect the addition,
substitution or removal of any Limited Partner or General Partner according to this Agreement,
(h) reflect any other amendment or modification to this Agreement, but only if such amendment
or modification is duly adopted in accordance with the terms hereof or (iii) facilitate the
implementation of the terms of this Agreement s❑ long as such instruments do not alter the rights
and obligations of the Limited Partners under the terms of this Agreement;
(c) all conveyances and other instruments or documents which the General
Partner deems appropriate or necessary to effect the dissolution and liquidation of the Partnership
pursuant to the terms of this Agreement, including a certificate of cancellation; and
(d) all instruments relating to the admission, withdrawal, or substitution of any
Partner pursuant to this Agreement.
The foregoing power of attorney is irrevocable and coupled with an interest, and shall
survive the death, incompetency, disability, Incapacity, dissolution, bankruptcy, insolvency, or
termination of any Owner and the Transfer of all or any portion of the Owner's Ownership Interest
and shall extend to the Owner's heirs, successors, assigns, and personal representatives. Any
Person dealing with the Partnership may conclusively presume and rely upon the fact that any
instrument referred to above,executed by such agents and attorneys-in-fact, is authorized, regular
and binding, without further inquiry.
Lynx Invest►nents, LLLP Page Z4
15.02 Alternative Dispute Resolution Procedures. Any and all disputes relating
to, arising out of, or involving the provisions of this Agreement shall be addressed by the parties
to such dispute (the "Parties" and each a "Party") as provided in this Section 15.02.
(a) .Negotiations. In the event that any dispute may arise, the Parties shall first
seek to resolve any disputes by negotiations between representatives which have authority to settle
the controversy.
(i) Notification. When a Party believes there is a dispute relating to this
Agreement, the Party shall give the other Party written notice of the dispute as provided. in
Section 15.04 of this Agreement.
(ii) Meetings. The representatives of the Parties shall meet at a mutually
acceptable time and place within thirty (30) days after the date of the notice to exchange relevant
information and to attempt to resolve the dispute. If the representative of a Party intends to be
accompanied at a meeting by an attorney, the other Party's representative shall be given at least
three (3) business days' notice of such intention and may also be accompanied by an attorney.
(iii) Confidentialit,. All negotiations are confidential and shall be
treated as compromise and settlement negotiations under the State of Idaho Rules of Evidence.
(b) Mediation. If the dispute has not been resolved within thirty(30) days after
the date of the notice of a dispute, or if the Party receiving such notice fails or refuses to meet
within such time period, either Party may initiate mediation of the dispute by sending the other
Party a written request that the dispute be mediated. The Party receiving such a written request
will promptly respond to the requesting Party so that all parties can Jointly select a neutral and
impartial mediator and schedule the mediation session. The parties shall mediate the dispute
before a neutral, thirty-party mediator within thirty (30) days after the date of the written request
for mediation.
(c) Arbitration. If a dispute has not been resolved within sixty (60) days after
the original notice of a dispute or within thirty (30) days after the date of a request for mediation,
whichever is later, then either Party may initiate arbitration proceedings. Notwithstanding the
foregoing provisions, if either Party deems that time is of the essence in resolving the dispute, it
may initiate arbitration and seek interim measures under the subsection titled "Interim Measures"
of this Section, if appropriate, and then comply with the requirements for negotiations and
mediation as long as they are fully completed before the commencement of the final hearing on
the merits in the arbitration proceeding.
(d) ScopefFinal and Binding. Any dispute, controversy or claim, of any and
every kind or type, whether based on contract, tort, statute, regulations, or otherwise, arising out
of, connected with, or relating in any way to this Agreement, the relationship of the Parties, the
obligations of the Parties under this Agreement, including without limitation,any dispute as to the
Lynx Investments, LLLP Page 25
existence, validity, construction, interpretation, negotiation, performance, non-performance,
breach, termination,or enforceability of this Agreement, shall be settled through final and binding
arbitration, it being the intention of the Parties that this is a broad form arbitration agreement
designed to encompass all possible disputes among the Parties relating to this Agreement.
(e) Institutional Arbitration. The arbitration shall be conducted before a single
arbitrator in accordance with the Commercial Arbitration Rifles of the American Arbitration
Association ("AAA") as in effect on the date of commencement of the arbitration proceeding (the
"AAA Rules"). The arbitration panel shall apply the State of Idaho Rules of Evidence to all
evidentiary questions arising in the course of the arbitration, and shall apply the State of Idaho
Rules of Civil Procedure to the conduct of discovery in the course of the arbitration.
(f) Place of Arbitration. Unless otherwise agreed in writing by all Parties to
the arbitration, the situs of the arbitration under this Agreement shall be Boise, Idaho.
(g) Entry of Judgment. Judgment on the award of the arbitral tribunal may be
entered by any court of competent jurisdiction.
(h) Interim Measures. The arbitrator may grant interim measures including
injunctions, attachments and conservation orders in appropriate circumstances, which measures
the Parties agree may be immediately enforced by the arbitrator or by court order. Hearings on
requests for interim measures may be held in person, by telephone or by video conference, and
requests for relief, responses, briefs or memorials may be sent to, and orders or awards received
from, the arbitrators by facsimile or other similar means which include a confirmation of delivery.
Notwithstanding the requirements for alternative dispute resolution procedures (such as
negotiation and mediation), prior to the constitution of the arbitration tribunal and thereafter as
necessary to enforce the arbitrators' rulings or in the absence of the jurisdiction of the arbitrators
to rule on interim measures in a given jurisdiction, any Party may apply to a court for interim
measures, and the Parties agree that seeking and obtaining such measures shall not waive the right
to arbitration.
W Costs and Attorney's Fees. In the event of any action, arbitration or
litigation to enforce this Agreement, for interpretation or construction of this Agreement, or on
account of any default under or breach of this Agreement, the nonprevailing Party to such action,
arbitration or litigation covenants and agrees to pay to the prevailing Party therein, in addition to
all other relief, all costs and expenses, expressly including, but not limited to, actual attorneys'
fees (regardless of any otherwise applicable court schedule for the determination of such costs,
expenses and attorneys' fees) incurred by such prevailing Party in connection with such action,
arbitration or litigation, including, but not limited to, any appeal thereof, which costs, expenses
and attorneys' fees shall be included in and as a part of any judgment rendered in such action,
arbitration or litigation. The arbitral tribunal is shall make an award of costs and attorney's fees in
accordance with this subsection.
Lynx rnvesements, LLLP Page 2G
0) Punitive Damages. Penal, punitive, treble, multiple, consequential,
incidental or similar damages may not be recovered or awarded.
(k) Confidentiality. Except to the extent necessary to enforce the arbitration,
agreement or award, to enforce other rights of the Party, or as required by law, the Parties, their
employees, managers, officers, directors, counsel, consultants, and expert witnesses, shall
maintain as confidential the fact of the arbitration proceeding,the arbitral award,contemporaneous
or historical documents exchanged or produced during the arbitration proceeding, and memorials,
briefs or other documents prepared for the arbitration.
(1) Waiver of Appeals. To the extent permitted by law, right to appeal from or
to cause a review of any arbitral award by any court is hereby waived by the Parties.
(m) Summary Disposition. The arbitrators are hereby authorized, if they
consider it appropriate, to decide any disputes by summary disposition on the documents and
written testimony without hearing oral testimony.
(n) Draft of the Proposed Award. Prior to rendering the final award,the arbitral
tribunal shall submit to the Parties an unsigned draft of the proposed award and each Party,within
ten (10)business days after receipt of such draft award, may serve on every other Party a file with
the tribunal a written statement commenting upon any alleged errors of fact, law, computation, or
otherwise. The tribunal shall endeavor to render its final award within ten(10)business days after
the receipt of the letter of the written statements of the Parties.
15.03 Further Action. The parties hereto shall execute and deliver all documents,
provide all information and take or refrain from taking action as may be necessary or appropriate
to achieve the purposes of this Agreement.
15.04 Notice. Any and all notices, elections,demands, solicitations of consent or
approval and other communications permitted or required to be made under this Agreement shall
be in writing, signed by the Person giving such notice, election, demand, solicitation or
communication and shall be delivered personally, transmitted by facsimile or sent by overnight
courier or registered or certified mail, return receipt requested, to the other party, at such party's
address set forth in the Partnership records. Notices shall be deemed to have been given on the
date personally delivered or transmitted by facsimile with confirmation of receipt or, if mailed or
sent by overnight courier, on the date sent.
15.05 No Delivery of Certificates. The General Partner is not required to deliver
copies of any certificate or amendment or cancellation to the Owners.
15.06 Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and, subject to the restrictions on Transfer set forth above, their heirs,
successors, assigns,executors, administrators, and legal representatives.
Lynx Itivesrraenrs, LLLP Page 27
15.07 Captions. Titles or captions for the Articles or Sections contained in this
Agreement are inserted only as a matter of convenience and for reference, and in no way define,
limit,extend, or describe the scope of this Agreement or the intent of any provision hereof.
15.08 Counterparts. This Agreement may be executed in counterparts (including
by means of facsimile), all ❑f which together shall for all purposes constitute one Agreement,
binding on all the parties notwithstanding that all parties have not signed the same counterpart.
15.09 Applicable Law. This Agreement and the rights and obligations of the
Partners and Owners hereunder shall be construed in accordance with and be governed by the
internal laws of the State of Idaho, without regard to the principles of conflicts of law.
15.10 Severance. If any provision of this Agreement or the application thereof to
any Person or circumstance is held invalid or unenforceable to any extent, the remainder of this
Agreement and the application of that provision to other Persons or circumstances is not affected
thereby and that provision shall be enforced to the greatest extent permitted by law.
15.11 Entire Agreement. This Agreement constitutes the entire agreement among
the parties hereto pertaining to the subject matter hereof, and supersedes all prior-agreements and
understandings pertaining thereto, if any.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
Unx Investments, LLLP Page 28
IN WITNESS WHEREOF, the undersigned have executed or caused to be
executed on their behalf this Agreement as of the date first above written.
By its Partners:
GENERAL PARTNERS:
Huarte Family Trust UITIA dated May 17, 2011
By. & �
Gregor rHuarte,vrrustee
By
Laurie ar , irt6tee
JosepVb. Hu
LIMITED PARTNERS:
Jaime A. Eddy
J ine L. Huarte,L�
JoSeA D. HL4rte
Erin E. McCoy
9
J cobse
LPIX Investments, LL.LP Page 29
IN WITNESS 'WHEREOF, the undersigned have executed or caused to be
executed on their behalf this Agreement as of the date first above written.
By its Partners:
GENERAL PARTNERS:
Huarte Family Trust U/TIA dated May 17, 2011
By:
Gregory T. Huarte, Trustee
By:
Laurie J. Huarte, Trustee
Joseph D. carte
LIMIT RTNERS:
J,4be A. Eddy
Janine L. Huarte
Joseph D. carte
c
Erin E. McCoy
Julie M. Jacobsen
Lynx investments, LLLP Page 29
LYNX INVESTMENTS,LLLP
OPERATING AGREEMENT
SCHEDULE A
GENERAL PARTNERS: Percentajze Interest
Huarte Family Trust U/TIA dated 1.500%
May 17, 2011
Joseph D. Huarte 0,500%
TOTAL GENERAL PARTNER 2.000%
LIMITED PARTNERS: Percentage Interest
Jaime A. Eddy 19.600%
Janine L. Huarte 19.600%
Joseph D. Huarte 19.600%
Erin E. McCoy 19.600%
Julie M. Jacobsen 19.600%
TOTAL LIMITED PARTNER 99.000%
TOTAL ALL PARTNERS 100.00%
Lynx Investments, LLLP—Schedule A Page 30
APPENDIX A
"Act" means the Uniform Limited Partnership Act, Idaho Code Title 30,
Chapter 24, §30-24-101 et seq., as it may be amended from time to time, and any successor to the
Act.
"Adjusted Capital Account Deficit" means, with respect to an Owner, the deficit
balance, if any, in the Capital Account of such Owner, after giving effect to the following
adjustments:
(a) credit to such Capital Account of any amounts that the Owner is obligated
to restore pursuant to Treasury Regulation Section 1.704-1(b)(2)(ii)(c) or deemed obligated to
restore pursuant to the penultimate sentences of Treasury Regulation Sections 1.704-2(g)(1)
and 1.704-2(i)(5), or any successor provisions thereof, and
(b) debit from such Capital Account the items described in Treasury Regulation
Sections 1.704-1(b)(2)(ii)(d)(4),(5) and(6).
"Affiliate" has the meaning of that term under Rule 144 of the Securities and
Exchange Commission.
"Agreement" means this Limited Liability Limited Partnership Agreement of
Lynx Investments, LLLP, as it may be amended, supplemented or restated from time to time.
"Applicable Federal Rate" means the applicable federal rate as defined in
Section 1274(d) of the Code for a debt instrument issued as of the date and with the term of the
promissory note described in Section 10.03(c) of this Agreement.
"Assignee" means a Transferee of an Ownership Interest who has not been
admitted as a Partner with respect to such Transferred Ownership Interest. No Owner who has not
been admitted as a Partner pursuant to this Agreement shall be deemed a"partner"(as that term is
used in the Act) of the Partnership. An Assignee shall not have any right to participate in the
management or affairs of the Partnership, including any right to vote on, consent to or otherwise
participate in any decision of the Managers or Partners, or any right to receive any information
concerning the business affairs of the Partnership, unless expressly provided otherwise herein.
"Book Value" means, with respect to any Partnership Property, the Partnership's
adjusted basis for federal income tax purposes,adjusted from time to time to reflect the adjustments
required or permitted by Treasury Regulation Section 1.704-1(b)(2)(iv)(d)-(g). For avoidance of
doubt,the Book Value of any property contributed to the Partnership shall, immediately following
Lynx Invesentents, LLLP—Appendix A Page 31
such contribution, equal the Fair Market Value of such property on the date it was contributed to
the Partnership.
"Capital Account" means the capital account maintained for an ❑wner pursuant
to Section 3.03.
"Capital Contribution" means any cash, cash equivalents or the Fair Market
Value of other property contributed or deemed contributed to the Partnership by an Owner.
"Certificate" means the Certificate of Limited Partnership of the Partnership, as it
may be amended or restated from time to time.
"Code" means the United States Internal Revenue Code of 1986, as it may be
amended from time to time, and any successor thereto.
"Descendant" of a natural person means such person's descendants in any degree
of consanguinity, including any descendants born at any time after such natural person's death.
A natural person adopted prior to his or her attaining the age of eighteen (18) years and the
descendants of any such adopted person shall be treated as descendants of the adopting parent or
parents and of anyone who is by blood or adoption an ancestor of the adopting parent or parents
for all purposes herein. A child shall not be considered a descendant of his or her natural or
adoptive parent (or of the ancestors of such parent) after the date of a court ❑rder terminating the
parent's parental rights of the child, unless such parental rights were terminated primarily as a
result of the actions of a party other than the parent.
"Distribution" means any amount distributed by the Partnership to an Owner
pursuant to Section 4.01 (distributions) or Section 13.03(b)(ii) (liquidating distributions).
"Event of Dissociation of a General Partner"means an event that causes a Person
to cease to be a General Partner as provided in Section 12.01 or in Section 30-24-603 of the Act.
"Fair Market Value" as to:
(a) any Ownership Interest means, as ❑f the effective date of a Transfer
pursuant to a right of first refusal as provided in Article 10: the price at which the Ownership
Interest would change hands between a hypothetical willing buyer and a hypothetical willing
seller, neither being under any compulsion to buy or sell and both having reasonable knowledge
of relevant facts. For this purpose, Fair Market Value of such ❑wnership Interest shall be
determined by the General Partner (who may employ a qualified appraiser for such purpose) or,
upon the request of a party to the Transfer, shall be determined by an independent appraisal
performed by a qualified appraiser selected by the General Partner and the decision of such
appraiser shall be conclusive on all parties. The fees and costs of such appraiser shall be paid by
the Transferring Owner in the case of a Transfer pursuant to Article 10.
Lynx Invesonews, LLLP-Appendix A Page 32
(b) any property other than an Ownership Interest means, as of the appropriate
valuation date, the price at which the subject property would change hands between a hypothetical
willing buyer and a hypothetical willing seller, neither being under any compulsion to buy or sell
and both having reasonable knowledge of relevant facts. For this purpose, the Fair Market Value
shall be determined as consistent with paragraph (a) by the General Partner or an independent
appraisal.
"Fiscal Year" of the Partnership means the calendar year.
"General Partner" means each person and entity listed in Schedule A as general
partners and any Person subsequently admitted to the Partnership pursuant to the terms of this
Agreement as a General Partner, until such person ceases to be a General Partner pursuant to the
terms of this Agreement.
"Incapacity" or "Incapacitated" means (a) with respect to a natural person,
(i) such person is under a legal disability (under the laws of such person's domicile) which has
lasted or is expected to continue for at least ninety(90) days, (ii) such person has been certified in
writing to be unable to manage his financial affairs by the principal physician attending to such
person's care, and the General Partner may rely upon written notice of that determination without
any duty to inquire into the authenticity of the certification or any of the facts upon which it is
based, (iii) such person's whereabouts are unknown and the General Partner has not been able to
locate such person for at least ninety(90) days, or(iv) the bankruptcy of such person, and(b) with
respect to any other Person,the bankruptcy,liquidation,dissolution, or termination of such Person.
"Limited Partner" means each person and entity listed in Schedule A as limited
partners and any Person subsequently admitted to the Partnership pursuant to the terms of this
Agreement as a Limited Partner, until such person ceases to be a Limited Partner pursuant to the
terms of this Agreement.
"Liquidator" has the meaning specified in Section 13.03.
"Nonrecourse Deductions" has the meaning set forth in Treasury Regulation
Section 1.704-2(b)(1).
"Owner" means a Partner or an Assignee.
"Ownership Interest" means the entire ownership interest of an Owner in the
Partnership held as an Owner (whether as a Partner or as an Assignee) at any particular time,
including the right(if any)of such Owner to Distributions, Profits and other benefits to which such
Owner may be entitled as provided in this Agreement and under the Act, together with the
obligations of such Owner to comply with all of the terms and provisions of this Agreement and
the Act. Each Ownership Interest shall be expressed as a percentage (the "Percentage Interest")
equal to the ratio (expressed as a percentage) that the Capital Account of such Owner bears to the
Lynx In vestmeii ts, LLLP—Appendix A Page 33
aggregate Capital Accounts of all Owners, as may be adjusted from time to time in accordance
with the provisions of this Agreement. For purposes of this Agreement, Percentage Interests shall
be carried out to at least three decimal places.
"Partner" means a General Partner or a Limited Partner.
"Partner Nonrecourse Debt" has the meaning set forth in Treasury Regulation
Section I304-2(b)(4).
"Partner Nonrecaurse Debt Minimum Gain" has the meaning set forth in
Treasury Regulation Section 1.704-2(i).
"Partner Nonrecaurse Deductions" has the meaning set forth in Treasury
Regulation Section 1.704-2(i), and the amount of Partner Nvnrecourse Deductions with respect to
a Partner Nonrecaurse Debt for a Taxable Year or other period shall be determined in accordance
with the rules of Treasury Regulation Section 1.704-2(i)(2).
"Partnership"means the limited partnership organized pursuant to the Certificate.
"Partnership Minimum Gain" has the meaning set forth in Treasury Regulation
Section 1.704-2(d).
"Partnership Property" means all real and personal property owned by the
Partnership (including cash) and any improvements thereto, and shall include both tangible and
intangible property and. assets.
"Percentage Interest" shall have the meaning ascribed in the definition of
Ownership Interest.
"Permitted Transferee" means any one or more of the following:
(a) the Partnership;
(b) Gregory T. Huarte, Laurie T. Huarte and the descendants of
Gregory T. Huarte and Laurie J. Huarte;
(c) a Partner;
(d) the decedent's estate or guardianship estate of any of the persons listed
in (b) or (c), or a revocable trust substitute for a decedent's estate the applicable operative
provisions ❑f which provide that the Ownership Interest is held exclusively for the benefit of one
❑r more of the persons listed in (b) or(c); and
Lynx Investments, LLLP—Appendix A Page 34
(e) a trust the terms of which provide that any Ownership Interest is held,at the
time of the Transfer to the trust, exclusively for the benefit of one or more of the persons listed
in (b) or(c);
provided, however, for purposes of(d) above, the remaindermen and potential objects of a power
of appointment over a trust shall not be considered in determining whether a trust is exclusively
for the benefit of one or more of the persons listed in (b) or(c).
"Person" means a natural person, partnership (whether general or limited), limited
liability company, trust, estate, association, corporation, custodian, nominee or any other
individual or entity in its own or any representative capacity.
"Prime Rate" means the most recently published U.S. prime rate in the "Money
Rates" section of The Wall Street Journal as in effect from time to time (or, if more than one rate
is published, the highest of such rates). In the event The Wall Street Journal ceases publication or
ceases to publish the "Prime Rate" as described above, the Prime Rate shall be the average per
annum discount rate on ninety-one (91) day bills issued from time to time by the United States
Treasury at its most recent auction, plus three hundred (300) basis points. If no such 91-day bills
are then being issued, the average per annum discount rate shall be the discount rate on such bills
then being issued by the United States Treasury for the period of time closest to ninety-one (91)
days.
"Profits"and"Lasses" means all items of Partnership income and gain,or loss and
deduction, respectively, to be allocated pursuant to Article 4 and to be reflected in the Capital
Accounts, the determination, recognition and classification of any such item to be the same as its
determination, recognition, and classification for federal income tax purposes (including any
method of depreciation, cost recovery or amortization used for this purpose), provided that:
(a) the computation of all items of income, gain, loss, and deduction shall
include income of the Partnership exempt from tax and nondeductible expenditures (as currently
described in Code Section 705(a)(1)(B), Code Section 705(a)(2)(B), or Treasury Regulation
Section 1.704--1(b)(2)(iv)(i)), without regard to the fact that such items are not includible in gross
income or are not deductible for federal income tax purposes;
(b) if the Book Value of any Partnership Property is adjusted because of a
distribution or revaluation of Partnership Property (as currently provided in Treasury Regulation
Section 1.704--1(b)(2)(iv)(e) or (f)), the amount of such adjustment shall be taken into account as
gain or loss from the disposition of such property;
(c) items of income, gain, loss or deduction attributable to the disposition of
Partnership Property having a Book Value that differs from its adjusted basis for tax purposes shall
be computed by reference to the Book Value of such property;
Lynx fnuestments, LLLP—Appendix A Page 35
(d) items of depreciation, amortization and other cost recovery deductions with
respect to Partnership Property having a Book Value that differs from its adjusted basis for tax
purposes shall be computed by reference to the property's Book Value (as currently provided in
Treasury Regulation Section 1.704-1(b)(2)(iv)(g)); and
(e) to the extent an adjustment is required to be made to the Capital Accounts
because of an allowable business credit, depletion of oil and gas properties, or an optional
adjustment to the basis of Partnership Property {as currently provided in Treasury Regulation
Section 1.704-1(b)(2)(iv)0), (k) or (m)), the amount of such adjustment shall be treated as an item
of gain (if the adjustment increases the Capital Accounts) or loss (if the adjustment decreases the
Capital Accounts.
"Securities Act" means the United States Securities Act of 1933, as it may be
amended from time to time, and applicable rules and regulations thereunder, and any successor to
such statute, rules or regulations.
"Taxable Year"means the Partnership's taxable year ending December 31 (or part
thereof, in the case of the Partnership's last taxable year), or such other year as is (a) required by
Section 706 of the Code or(b) determined by the General Partner and permitted by the Code.
"Testamentary Transfer" means a gratuitous Transfer (by will or other
instrument) taking effect at the death of the Transferor or other person.
"Transfer" means, as a noun, a transaction by which an Owner assigns all or any
portion of his Ownership Interest or any interest therein to another Person, including a sale,
assignment, gift, bequest (by will or otherwise), transfer by intestacy, pledge, encumbrance,
hypothecation, mortgage, exchange, distribution from an estate, trust or other entity or any other
disposition. "Transfer" means, as a verb, to voluntarily or involuntarily enter into a transaction
described above as a Transfer. The terms "Transferor," "Transferee," "Transferred" and
"Transferring" have correlative meanings.
"Transferred Ownership Interest" means any Ownership Interest that (a) was
Transferred or(b) is proposed to be Transferred.
"Transferring Owner" means an Owner who makes or proposes to make a
Transfer of its Ownership Interest in accordance with Article 10.
"Treasury Regulations" means the income tax regulations promulgated under the
Code and effective, as amended from time to time.
Lynx Avestmenis, LLLP—Appendix A Page 36
LYNX INVESTMENTS, LLLP
OPERATING AGREEMENT
SCHEDULE B
AGREEMENT OF SPOUSE
I, the spouse of JUG` V ^ herein referred to as the "Partner," recognize and
agree that all ❑f my right, title and interest in the interest of the Partner (the "Ownership Interest")
in Lynx Investments, LLLP (the "Partnership"), including my community interest, if any, in the
Ownership Interest, shall be subject to the provisions of the Lynx Investments, LLLP Partnership
Agreement attached hereto, plus amendments, and in particular without limitation thereto:
1. Upon the death of the Partner, my community interest, if any,and all of my
right, title and interest in and to the ❑wnership Interest standing in the name of the Partner shall
be subject to the provisions of said agreement.
2. The value fixed by the terms of the foregoing agreement shall apply to my
community and/or separate property interests, if any, and that of the Partner in the Partnership.
3. In the event of a sale, pledge and/or assignment of the Ownership Interest
standing in the name ❑f the Partner, pursuant to the provisions of said agreement, I will execute
any and all assignments, documents and instruments ❑f conveyance considered desirable or
necessary by the Partnership to complete the sale, pledge, and/or assignment of the Ownership
Interest.
4. For purposes of management of the Partnership, including any decisions
upon which a vote of the Partner is necessary, the Ownership Interest standing in the name of the
Partner will be represented by the Partner, who shall make all management decisions permitted
with respect to that Ownership Interest and cast all votes to which the Ownership Interest may be
entitled.
5. Any decree of divorce, separate maintenance or property settlement
agreement between the Partner and me shall include a provision that any interest I now own or
hereafter acquire in the Ownership Interest shall either be sold to the Partner upon the terms and
conditions contained therein or shall be granted to the Partner as part of the division ❑f our property
with other offsetting assets being granted to me if the ❑wnership Interest is the Partner's and my
community property.
Lynx Investments, LLLP—Schedule B Page 37
6. If I do not have an interest (community or separate) in the property referred
to herein, then neither the filing of a joint tax return nor the signing of this agreement shall create
such an interest. +
DATED this } day of L f Z .
"spouse'
f
Lyiu hivestmews, LLLP—Schedule B Page 38
LYNX INVESTMENTS,LLLP
OPERATING AGREEMENT
SCHEDULE B
AGREEMENT OF SPOUSE
I, the spouse of , herein referred to as the "Partner," recognize and
agree that all of my right, title and intere in the interest of the Partner (the "Ownership Interest")
in Lynx Investments, LLLP (the "Partnership"), including my community interest, if any, in the
Ownership Interest, shall be subject to the provisions of the Lynx Investments, LLLP Partnership
Agreement attached hereto, plus amendments, and in particular without limitation thereto:
I. Upon the death of the Partner, my community interest, if any, and all of my
right, title and interest in and to the Ownership Interest standing in the name of the Partner shall
be subject to the provisions of said agreement.
2. The value fixed by the terms of the foregoing agreement shall apply to my
community and/or separate property interests, if any, and that of the Partner in the Partnership.
3. In the event of a sale, pledge and/or- assignment of the Ownership Interest
standing in the name of the Partner, pursuant to the provisions of said agreement, I will execute
any and all assignments, documents and instruments of conveyance considered desirable or
necessary by the Partnership to complete the sale, pledge, and/or assignment of the Ownership
Interest.
4. For purposes of management of the Partnership, including any decisions
upon which a vote of the Partner is necessary, the Ownership Interest standing in the name of the
Partner will be represented by the Partner, who shall make all management decisions permitted
with respect to that Ownership Interest and cast all votes to which the Ownership Interest may be
entitled.
5. Any decree of divorce, separate maintenance or property settlement
agreement between the Partner and me shall include a provision that any interest I now own or
hereafter acquire in the Ownership Interest shall either be sold to the Partner upon the terms and
conditions contained therein or shall be granted to the Partner as part of the division of our property
with other offsetting assets being granted to me if the Ownership Interest is the Partner's and my
community property.
Lynx Investments, LLLP—Schedule B Page 37
b. If I do not have an interest (community or separate) in the property referred
to herein, then neither the filing of a joint tax return nor the signing of this agreement shall create
such an interest.
DATED this 0 of u• C} ,
"Spous '
Lynx Investments, LLLP—Schedule B Page 38
LYNX INVESTMENTS,LLLP
OPERATING AGREEMENT
SCHEDULE B
AGREEMENT OF SPOUSE
I, the spouse of 1A%D4 C O al , herein referred to as the "Partner," recognize and
agree that all of my right, title and interest in the interest of the Partner (the "Ownership Interest")
in Lynx Investments, LLLP (the "Partnership"), including my community interest, if any, in the
Ownership Interest, shall be subject to the provisions of the Lynx Investments, LLLP Partnership
Agreement attached hereto, plus amendments, and in particular without limitation thereto:
I. Upon the death of the Partner, my community interest, if any, and all of my
right, title and interest in and to the Ownership Interest standing in the name of the Partner shall
be subject to the provisions of said agreement.
2. The value fixed by the terms of the foregoing agreement shall apply to my
community and/or separate property interests, if any, and that of the Partner in the Partnership.
3. In the event of a sale, pledge and/or assignment of the Ownership Interest
standing in the name of the Partner, pursuant to the provisions of said agreement, I will execute
any and all assignments, documents and instruments of conveyance considered desirable or
necessary by the Partnership to complete the sale, pledge, and/or assignment of the Ownership
Interest.
4. For purposes of management of the Partnership, including any decisions
upon which a vote of the Partner is necessary, the Ownership Interest standing in the name of the
Partner will be represented by the Partner, who shall make all management decisions permitted
with respect to that Ownership Interest and cast all votes to which the Ownership Interest may be
entitled.
5. Any decree of divorce, separate maintenance or property settlement
agreement between the Partner and me shall include a provision that any interest I now own or
hereafter acquire in the Ownership Interest shall either be sold to the Partner upon the terms and
conditions contained therein or shall be granted to the Partner as part of the division of our property
with other offsetting assets being granted to me if the Ownership Interest is the Partner's and my
community property.
Lynx Investments, LLLP—Schedirde B Page 37
b. If I do not have an interest (community or separate) in the property referred
to herein, then neither the filing of a joint tax return nor the signing of this agreement shall create
such an interest.
DATED this day of
"Spouse'
Lynx Investments, LLLP—Schedule B Page 38
LYNX INVESTMENTS,LLLP
OPERATING AGREEMENT
SCHEDULE B
AGREEMENT OF SPOUSE
I, the spouse of �oscf 1 I ra--, herein referred to as the "Partner," recognize and
agree that all ❑f my right, title and interest in the interest of the Partner (the "Ownership Interest")
in Lynx Investments, LLLP (the "Partnership"), including my community interest, if any, in the
Ownership Interest, shall be subject to the provisions of the Lynx Investments, LLLP Partnership
Agreement attached hereto, plus amendments, and in particular without limitation thereto:
1. Upon the death of the Partner, my community interest, if any, and all of my
right, title and interest in and to the Ownership Interest standing in the name ❑f the Partner shall
be subject to the provisions of said agreement.
2. The value fixed by the terms of the foregoing agreement shall apply to my
community and/or separate property interests, if any, and that of the Partner in the Partnership.
3. In the event of a sale, pledge and/or assignment of the Ownership Interest
standing in the name of the Partner, pursuant to the provisions of said agreement, I will execute
any and all assignments, documents and instruments of conveyance considered desirable or
necessary by the Partnership to complete the Sale, pledge, and/or assignment of the Ownership
Interest.
4. For purposes of management of the Partnership, including any decisions
upon which a vote ❑f the Partner is necessary, the Ownership Interest standing in the name ❑f the
Partner will be represented by the Partner, who shall make all management decisions permitted
with respect to that Ownership Interest and cast all votes to which the Ownership Interest may be
entitled.
5. Any decree of divorce, separate maintenance or property settlement
agreement between the Partner and xne shall include a provision that any interest I now own or
hereafter acquire in the Ownership Interest shall either be sold to the Partner upon the terms and
conditions contained therein or shall be granted to the Partner as part of the division of our property
with other offsetting assets being granted to me if the Ownership Interest is the Partner's and my
community property.
Lpu hvesrniews, LLLP—Schedule B Page 37
6. If I do not have an interest (community or separate) in the property referred
to herein, then neither the filing of a joint tax return nor the signing of this agreement shall create
such an interest.
DATED this day ofl, W ,
"Spore V V
Lp ix Avestme+its, LLLP—Schedule B Page 38
EXHIBIT A
PROMISSORY NOTE
$ Boise, Idaho ,
For value received, the undersigned [Delinquent Owner Name and Address] (the
"Borrower"), hereby promises to pay to the order of f Lending Partner Name] (the "Lender"), at
[Address of Lending Member], or at any other place designated at any time by the Lender, in
lawful money of the United States of America and in immediately available funds, the principal
sum of Dollars ($ ), together with
interest on the principal amount hereunder remaining unpaid from time to time, computed on the
basis of the actual number of days elapsed and a 365-day year, from the date hereof until this Note
is fully paid at the rate of[ percent ( %)] per annum, compounded monthly.
The principal hereof and interest accruing thereon shall be due and payable as follows:
IN FULL NINETY (90) DAYS AFTER THE DATE OF THIS NOTE
This Note may be prepaid in whole or in part at any time without penalty. All payments shall
be applied first to the payment of accrued interest and then to the reduction of the principal balance.
In the event that Borrower shall default in payment of this Note or under any agreement
securing this Note, Lender may, in Lender's discretion, notify Borrower in writing of such default
by personal delivery or United States certified mail, return receipt requested, addressed to the
Borrower's address set forth above. If Borrower does not correct the default within ten (10) days
after such notice of default, then Lender, in Lender's discretion, may declare the entire balance of
principal and interest hereunder to be due and payable immediately (time being the essence
hereof).
The Borrower agrees to pay on demand all costs and expenses, including (without limitation)
attorneys' fees, incurred by the Lender in connection with this Note and any other document or
agreement related hereto and the transactions contemplated hereby, including without limitation
all such costs, expenses and fees incurred in connection with the amendment, administration,
performance,collection and enforcement of this Note and all such documents and agreements and
the creation, perfection, protection, satisfaction, foreclosure or enforcement of any agreement or
interest securing this Note.
Presentment for payment, demand, and notice of dishonor and nonpayment, are expressly
waived.
This Note is delivered in the State of Idaho and shall be governed by and construed and
interpreted in accordance with the laws of said State.
DATED this day of ,
[Name of Delinquent Owner]
Lynx Investments,LLLP—Exhibit A Page.39