Exhibit No. 10.45
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LIMITED LIABILITY COMPANY AGREEMENT
OF
AMERICAN GENERAL GATEWAY SERVICES, L.L.C.
A DELAWARE LIMITED LIABILITY COMPANY
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Exhibit No. 10.45
LIMITED LIABILITY COMPANY AGREEMENT
OF
AMERICAN GENERAL GATEWAY SERVICES, L.L.C.
A DELAWARE LIMITED LIABILITY COMPANY
TABLE OF CONTENTS
RECITALS
ARTICLE 1 DEFINITIONS
1.01 DEFINITIONS.........................................................1
1.02 CONSTRUCTION........................................................9
ARTICLE 2 ORGANIZATION
2.01 FORMATION...........................................................9
2.02 NAME................................................................9
2.03 REGISTERED OFFICE; REGISTERED AGENT; PRINCIPAL OFFICE;
OTHER OFFICES.......................................................9
2.04 PURPOSES............................................................9
2.05 FOREIGN QUALIFICATION...............................................9
2.06 TERM...............................................................10
2.07 NO STATE-LAW PARTNERSHIP...........................................10
ARTICLE 3 MEMBERSHIP; DISPOSITIONS OF INTERESTS
3.01 INITIAL MEMBERS....................................................10
3.02 REPRESENTATIONS, WARRANTIES AND COVENANTS..........................10
3.03 DISPOSITIONS AND ENCUMBRANCES OF MEMBERSHIP INTERESTS..............11
3.04 CREATION OF ADDITIONAL MEMBERSHIP INTEREST.........................14
3.05 ACCESS TO INFORMATION..............................................14
3.06 CONFIDENTIAL INFORMATION...........................................15
3.07 LIABILITY TO THIRD PARTIES.........................................16
3.08 WITHDRAWAL.........................................................16
ARTICLE 4 CAPITAL CONTRIBUTIONS
4.01 INITIAL CONTRIBUTIONS..............................................17
4.02 SUBSEQUENT CAPITAL CONTRIBUTIONS...................................17
4.03 FAILURE TO CONTRIBUTE..............................................17
4.04 LOANS..............................................................18
4.05 RETURN OF CONTRIBUTIONS............................................18
4.06 CAPITAL ACCOUNTS...................................................18
ARTICLE 5 DISTRIBUTIONS; ALLOCATIONS OF PROFIT AND LOSS
5.01 DISTRIBUTIONS......................................................19
5.02 DISTRIBUTIONS ON DISSOLUTION AND WINDING UP........................19
5.03 ALLOCATIONS........................................................19
5.04 VARYING INTERESTS..................................................20
Exhibit No. 10.45
ARTICLE 6 MANAGEMENT
6.01 MANAGEMENT BY MEMBERS..............................................20
6.02 MANAGEMENT COMMITTEE...............................................20
6.03 MANAGING MEMBER....................................................24
6.04 CONFLICTS OF INTEREST..............................................25
6.05 INDEMNIFICATION FOR BREACH OF AGREEMENT............................25
ARTICLE 7 TAXES
7.01 TAX RETURNS........................................................26
7.02 TAX ELECTIONS......................................................26
ARTICLE 8 BOOKS, RECORDS, REPORTS, BUDGETS AND BANK ACCOUNTS
8.01 MAINTENANCE OF BOOKS...............................................26
8.02 REPORTS AND BUDGETS................................................26
8.03 BANK ACCOUNTS......................................................27
ARTICLE 9 BUYOUT OPTION
9.01 BUYOUT EVENTS......................................................27
9.02 PROCEDURE..........................................................28
9.03 PURCHASE PRICE.....................................................28
9.04 CLOSING............................................................28
9.05 TERMINATED MEMBER..................................................28
ARTICLE 10 DISPUTE RESOLUTION
10.01 DISPUTES...........................................................29
10.02 NEGOTIATION TO RESOLVE DISPUTES....................................29
10.03 SELECTION OF ARBITRATOR............................................30
10.04 CONDUCT OF ARBITRATION.............................................30
10.05 IMMEDIATE INJUNCTIVE RELIEF........................................31
ARTICLE 11 DISSOLUTION, WINDING-UP AND TERMINATION
11.01 DISSOLUTION........................................................31
11.02 WINDING-UP AND TERMINATION.........................................31
11.03 DEFICIT CAPITAL ACCOUNTS...........................................32
11.04 CERTIFICATE OF CANCELLATION........................................33
ARTICLE 12 GENERAL PROVISIONS
12.01 OFFSET.............................................................33
12.02 NOTICES............................................................33
12.03 ENTIRE AGREEMENT; SUPERSEDING EFFECT...............................33
12.04 EFFECT OF WAIVER OR CONSENT........................................33
12.05 AMENDMENT OR RESTATEMENT...........................................34
12.06 BINDING EFFECT.....................................................34
12.07 GOVERNING LAW; SEVERABILITY........................................34
12.08 FURTHER ASSURANCES.................................................34
12.09 WAIVER OF CERTAIN RIGHTS...........................................34
12.10 COUNTERPARTS.......................................................34
Exhibit No. 10.45
EXHIBIT:
A Members
B Guidelines for Measurement of CalPERS Profits
Exhibit No. 10.45
LIMITED LIABILITY COMPANY AGREEMENT
OF
AMERICAN GENERAL GATEWAY SERVICES, L.L.C.
A Delaware Limited Liability Company
THIS LIMITED LIABILITY COMPANY AGREEMENT OF AMERICAN GENERAL GATEWAY SERVICES, L.L.C. (this "Agreement"), dated as of January 1, 1999 (the "EFFECTIVE DATE"), is entered into by The Variable Annuity Life Insurance Company, a Texas life insurance company ("VALIC"), and Gateway Investment Services, Inc., a California corporation ("GATEWAY").
RECITALS
1. Pursuant to a letter of intent, dated September 18, 1998 (the "PRELIMINARY AGREEMENT"), VALIC and Gateway have agreed to form the Company (as defined below).
2. VALIC and Gateway now desire to enter into this Agreement to agree upon various matters relating to the Company.
ARTICLE 1
DEFINITIONS
1.01 DEFINITIONS. As used in this Agreement, the following terms have the respective meanings set forth below or set forth in the Sections referred to below:
AAA - Section 10.03(b).
ACT - the Delaware Limited Liability Company Act.
AFFILIATE - with respect to any Person, (a) each entity that such
Person Controls; (b) each Person that Controls such Person, including,
in the case of a Member, such Member's Parent; and (c) each entity that
is under common Control with such Person, including, in the case of a
Member, each entity that is Controlled by such Member's Parent.
AGREEMENT - introductory paragraph.
ALTERNATE REPRESENTATIVE - Section 6.02(a)(i).
ACQUISITION NOTICE - Section 9.02.
ARBITRATION NOTICE - Section 10.02(c).
ARBITRATOR - Section 10.03(a).
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Exhibit No. 10.45
ASSIGNEE - any Person that acquires a Membership Interest or any
portion thereof through a Disposition; provided, however, that, an
Assignee shall have no right to be admitted to the Company as a Member
except in accordance with Section 3.03. The Assignee of a dissolved
Member is the shareholder, partner, member or other equity owner or
owners of the dissolved Member to whom such Member's Membership
Interest is assigned by the Person conducting the liquidation or
winding up of such Member. The Assignee of a Bankrupt Member is (a) the
Person or Persons (if any) to whom such Bankrupt Member's Membership
Interest is assigned by order of the bankruptcy court or other
Governmental Authority having jurisdiction over such Bankruptcy, or (b)
in the event of a general assignment for the benefit of creditors, the
creditor to which such Membership Interest is assigned.
BANKRUPTCY or BANKRUPT - with respect to any Person, that (a) such
Person (i) makes a general assignment for the benefit of creditors;
(ii) files a voluntary bankruptcy petition; (iii) becomes the subject
of an order for relief or is declared insolvent in any federal or state
bankruptcy or insolvency proceedings; (iv) files a petition or answer
seeking for such Person a reorganization, arrangement, composition,
readjustment, liquidation, dissolution, or similar relief under any
Law; (v) files an answer or other pleading admitting or failing to
contest the material allegations of a petition filed against such
Person in a proceeding of the type described in subclauses (i) through
(iv) of this clause (a); or (vi) seeks, consents to, or acquiesces in
the appointment of a trustee, receiver, or liquidator of such Person or
of all or any substantial part of such Person's properties; or (b)
against such Person, a proceeding seeking reorganization, arrangement,
composition, readjustment, liquidation, dissolution, or similar relief
under any Law has been commenced and 120 Days have expired without
dismissal thereof or with respect to which, without such Person's
consent or acquiescence, a trustee, receiver, or liquidator of such
Person or of all or any substantial part of such Person's properties
has been appointed and 90 Days have expired without the appointment's
having been vacated or stayed, or 90 Days have expired after the date
of expiration of a stay, if the appointment has not previously been
vacated.
BUSINESS DAY - any day other than a Saturday, a Sunday, or a
holiday on which national banking associations in the States of
California and Texas are closed.
BUYOUT EVENT - Section 9.01.
CalPERS CONTRACT - the Agreement (Contract Number 97-169), dated
July 1, 1997, between the California Public Employee Retirement System
and Gateway, as such agreement is amended from time to time.
CalPERS LOSSES - the Losses of the Company, calculated solely by
reference to the business generated directly by the CalPERS Contract or
the clients obtained thereunder, on a stand-alone basis, and by
reference to the principles set forth on Exhibit B.
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Exhibit No. 10.45
CalPERS PROFITS - the Profits of the Company, calculated solely by
reference to the business generated directly by the CalPERS Contract or
the clients obtained thereunder, on a stand-alone basis, and by
reference to the principles set forth on Exhibit B.
CAPITAL ACCOUNT - the account to be maintained by the Company for
each Member in accordance with Section 4.06.
CAPITAL CONTRIBUTION - with respect to any Member, the amount of
money and the net agreed fair market value of any property (other than
money) contributed to the Company by the Member. Any reference in this
Agreement to the Capital Contribution of a Member shall include a
Capital Contribution of its predecessors in interest.
CERTIFIED PUBLIC ACCOUNTANTS - a firm of independent public
accountants selected from time to time by the Managing Member.
CHANGE OF MEMBER CONTROL - with respect to any Member, (a) an
event that causes such Member to cease to be Controlled by such
Member's Parent; or (b) a change in control of a nature that would
require such Member's Parent to report in response to Item 6(e) of
Schedule 14A of Regulation 14A promulgated under the Exchange Act or,
if Item 6(e) is no longer in effect, any regulations issued by the
Securities and Exchange Commission pursuant to the Exchange Act which
serve similar purposes; provided that, without limitation, such a
change in control shall be deemed to have occurred if and when either
(i) any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act) is or becomes a "beneficial owner" (as such term is
defined in Rule 13d-3 promulgated under the Exchange Act), directly or
indirectly, of securities of such Member's Parent, representing 25% or
more of the combined voting power of the Parent's then outstanding
securities entitled to vote with respect to the election of its Board
of Directors or (ii) as the result of a tender offer, merger,
consolidation, sale of assets, or contest for election or directors, or
any combination of the foregoing transactions or events, individuals
who were members of the Parent's Board of Directors immediately prior
to any such transaction or event shall not constitute a majority of the
Board of Directors following such transaction or event.
CLAIM - any and all judgments, claims, causes of action, demands,
lawsuits, suits, proceedings, Governmental investigations or audits,
losses, assessments, fines, penalties, administrative orders,
obligations, costs, expenses, liabilities and damages (whether actual,
consequential or punitive), including interest, penalties, reasonable
attorney's fees, disbursements and costs of investigations,
deficiencies, levies, duties and imposts.
CODE - the Internal Revenue Code of 1986, as amended.
COMPANY - American General Gateway Services, L.L.C., a Delaware
limited liability company.
CONFIDENTIAL INFORMATION - information and data (including all
copies thereof) that is furnished or submitted by any of the Members or
their Affiliates (whether oral, written, or electronic) on a
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Exhibit No. 10.45
confidential basis to the other Members or their Affiliates in
connection with the Company, and any and all of the activities,
analyses and studies performed pursuant to the Preliminary Agreement or
this Agreement, and the resulting information and data obtained from
those analyses and studies. Notwithstanding the foregoing, the term
"Confidential Information" shall not include any information that:
(a) is in the public domain at the time of its disclosure or
thereafter, other than as a result of a disclosure directly or
indirectly by a Member or its Affiliates in contravention of the
Confidentiality Agreement or this Agreement;
(b) as to any Member, was in the possession of such Member
or its Affiliates prior to the execution of the Confidentiality
Agreement provided that, to the knowledge of such Member, the
information is not subject to any confidentiality obligations
which prohibit its disclosure; or
(c) has been independently acquired or developed by a Member
or its Affiliates without violating any of the obligations of such
Member or its Affiliates under the Confidentiality Agreement, the
Preliminary Agreement or this Agreement.
CONFIDENTIALITY AGREEMENT - that certain letter agreement, dated
August 17, 1998, between American General Corporation and Bank Plus
Corporation.
CONTINUATION ELECTION - Section 11.01(b).
CONTROL - the possession, directly or indirectly, through one or
more intermediaries, of either of the following:
(a) (i) in the case of a corporation, more than 80% of the
outstanding voting securities thereof; (ii) in the case of a
limited liability company, partnership, limited partnership or
venture, the right to more than 80% of the distributions therefrom
(including liquidating distributions); (iii) in the case of a
trust or estate, including a business trust, more than 80% of the
beneficial interest therein; and (iv) in the case of any other
entity, more than 80% of the economic or beneficial interest
therein; or
(b) in the case of any entity, the power or authority,
through ownership of voting securities, by contract or otherwise,
to exercise a controlling influence over the management of the
entity.
DAY - a calendar day; provided, however, that, if any period of
Days referred to in this Agreement shall end on a Day that is not a
Business Day, then the expiration of such period shall be automatically
extended until the end of the first succeeding Business Day.
DEFAULT - with respect to any Member, the failure of a Member to
comply in any material respect with any of its agreements, covenants or
obligations under this Agreement (other than its agreement not to
Withdraw from the Company in Section 3.08), or the failure of any
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Exhibit No. 10.45
representation or warranty made by a Member in this Agreement to have
been true and correct in all material respects at the time it was made,
in each case if such default is not cured by the applicable Member
within 30 Days of its receiving notice of such default from any other
Member (or, if such default is not capable of being cured within such
30-Day period, if such Member fails to promptly commence substantial
efforts to cure such default or to prosecute such curative efforts to
completion with continuity and diligence).
DEFAULT RATE - a rate per annum equal to the lesser of (a) a
varying rate per annum equal to the sum of (i) the prime rate as
published in The Wall Street Journal, with adjustments in that varying
rate to be made on the same date as any change in that rate is so
published, PLUS (ii) 2 % per annum, and (b) the maximum rate permitted
by Law.
DEFERRED AMOUNT - Section 9.03(c).
DELAWARE CERTIFICATE - Section 2.01.
DISPOSE, DISPOSING or DISPOSITION - with respect to any asset
(including a Membership Interest or any portion thereof), a sale,
assignment, transfer, conveyance, gift, exchange or other disposition
of such asset, whether such disposition be voluntary, involuntary or by
operation of Law, including the following: (a) in the case of an asset
owned by a natural person, a transfer of such asset upon the death of
its owner, whether by will, intestate succession or otherwise; (b) in
the case of an asset owned by an entity, (i) a merger or consolidation
of such entity (other than where such entity is the survivor thereof),
(ii) a conversion of such entity into another type of entity, or (iii)
a distribution of such asset, including in connection with the
dissolution, liquidation, winding-up or termination of such entity
(unless, in the case of dissolution, such entity's business is
continued without the commencement of liquidation or winding-up); and
(c) a disposition in connection with, or in lieu of, a foreclosure of
an Encumbrance; but such terms shall not include the creation of an
Encumbrance.
DISPOSING MEMBER - Section 3.03(b)(ii)(A).
DISPOSITION INTEREST - Section 3.03(b)(ii)(A).
DISPOSITION NOTICE - Section 3.03(b)(ii)(A).
DISPUTE - Section 10.01.
DISPUTING MEMBER - Section 10.01.
DISSOLUTION EVENT - Section 11.01(a).
EFFECTIVE DATE - introductory paragraph.
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Exhibit No. 10.45
ENCUMBER, ENCUMBERING, or ENCUMBRANCE - the creation of a security
interest, lien, pledge, mortgage or other encumbrance, whether such
encumbrance be voluntary, involuntary or by operation of Law.
EXCHANGE ACT- Securities Exchange Act of 1934
EXERCISE NOTICE - Section 3.03(b)(ii)(A).
FAIR MARKET VALUE - Section 9.04.
GATEWAY - introductory paragraph.
GATEWAY PAYOUT DATE - the date on which Gateway has received cash
distributions in an amount equal to the Operating Losses.
GOVERNMENTAL AUTHORITY - a federal, state, local or foreign
governmental authority; a state, province, commonwealth, territory or
district thereof; a county or parish; a city, town, township, village
or other municipality; a district, ward or other subdivision of any of
the foregoing; any executive, legislative or other governing body of
any of the foregoing; any agency, authority, board, department, system,
service, office, commission, committee, council or other administrative
body of any of the foregoing; any court or other judicial body; and any
officer, official or other representative of any of the foregoing.
INCLUDING - including, without limitation.
INTEREST RATE - a rate per annum equal to the lesser of (a) a
varying rate per annum equal to the prime rate as published in The Wall
Street Journal, with adjustments in that varying rate to be made on the
same date as any change in that rate is so published, and (b) the
maximum rate permitted by Law.
LAW - any applicable constitutional provision, statute, act, code
(including the Code), law, regulation, rule, ordinance, order, decree,
ruling, proclamation, resolution, judgment, decision, declaration, or
interpretative or advisory opinion or letter of a Governmental
Authority having valid jurisdiction.
LOSSES - the losses of the Company as determined by the Managing
Member, which losses shall be determined quarterly in accordance with
GAAP and by reference to the principles set forth on Exhibit B.
MAJORITY INTEREST - Members holding among them at least a majority
of the Sharing Ratios.
MANAGEMENT COMMITTEE - Section 6.02.
MANAGING MEMBER - Section 6.03.
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Exhibit No. 10.45
MANAGING-MEMBER INDEMNIFIED ACTS - Section 6.03(d).
MANAGING-MEMBER INDEMNIFIED PARTIES - Section 6.03(d).
MASTER AGREEMENT - the Master Agreement, dated December 17, 1998,
between VALIC, Gateway and Bank Plus Corporation.
MEMBER - any Person executing this Agreement as of the date of
this Agreement as a member or hereafter admitted to the Company as a
member as provided in this Agreement, but such term does not include
any Person who has ceased to be a member in the Company.
MEMBERSHIP INTEREST - with respect to any Member, (a) that
Member's status as a Member; (b) that Member's share of the income,
gain, loss, deduction and credits of, and the right to receive
distributions from, the Company; (c) all other rights, benefits and
privileges enjoyed by that Member (under the Act, this Agreement, or
otherwise) in its capacity as a Member, including that Member's rights
to vote, consent and approve and otherwise to participate in the
management of the Company, including through the Management Committee;
and (d) all obligations, duties and liabilities imposed on that Member
(under the Act, this Agreement or otherwise) in its capacity as a
Member, including any obligations to make Capital Contributions.
NON-CASH CONSIDERATION - Section 3.03(b)(ii)(D).
NON-COMPETITION AGREEMENT - the Non-Competition Agreement, dated
as of the Effective Date, executed by Robert Condon in favor of VALIC
and the Company.
OPERATING LOSSES - $2 Million.
OFFICER - any Person designated as an officer of the Company as
provided in Section 6.03(c), but such term does not include any Person
who has ceased to be an officer of the Company.
PARENT - the Person that Controls a Member and that is not itself
Controlled by any other Person. The Parent of Gate ...
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