LLC Conversion Agreement

LLC CONVERSION AGREEMENT

This LLC Conversion Agreement (the Agreement) is made and entered into as of the Effective Date: , by and between Converting Entity: , a Corporation Partnership Other organized under the laws of (the Converting Entity), and Resulting Limited Liability Company: , to be organized under the laws of (the Resulting LLC).

RECITALS

WHEREAS, the Converting Entity is duly organized and validly existing under the laws of its jurisdiction and is the owner of certain assets and subject to certain liabilities as more particularly described in the Plan of Conversion attached hereto as Exhibit A; and

WHEREAS, the Converting Entity's board of directors, managers or other governing body has approved the conversion contemplated herein in accordance with applicable law and the governing documents of the Converting Entity; and

WHEREAS, the parties desire to set forth the terms and conditions under which the Converting Entity will convert into the Resulting LLC and the method by which the membership interests, assets and liabilities will be transferred, assumed or otherwise provided for.

NOW, THEREFORE, in consideration of the mutual covenants, agreements and undertakings set forth herein, the parties agree as follows:

1. Conversion

1.1 Conversion. Upon the terms and subject to the conditions of this Agreement and applicable law, at the Effective Time (as defined below) the Converting Entity shall be converted into the Resulting LLC pursuant to the statutes of the State of and the Converting Entity shall cease to be the form of entity it was prior to such conversion and shall thereafter be the Resulting LLC.

1.2 Plan of Conversion. The Plan of Conversion, which sets forth the manner and basis of converting interests, ownership rights and obligations, is incorporated into this Agreement and the parties agree to perform their obligations under such Plan. The Plan of Conversion is dated:

2. Effective Time

2.1 Effective Time. The conversion shall be effective at the time and on the date specified by the parties in the certificate of conversion or other instrument filed with the appropriate state authority, or at such later or earlier time as specified by the parties and permitted by applicable law (the Effective Time). The Effective Time shall be recorded by the Resulting LLC in its corporate records and communicated in writing to the parties.

3. Organizational Documents; Governance

3.1 Formation Documents. The Resulting LLC shall adopt and file Articles of Organization (or such other formation document required by the jurisdiction of organization) in form and substance reasonably acceptable to the Converting Entity and consistent with the Plan of Conversion. The Resulting LLC's Operating Agreement shall be adopted as of the Effective Time and shall govern the rights and obligations of the members and managers except as otherwise provided herein.

3.2 Management. The initial managers and/or members of the Resulting LLC, the initial capital structure and any classes or series of membership interests shall be as set forth in the Operating Agreement and the Plan of Conversion. Any appointment or designation of managers or officers shall be effective as provided in the Operating Agreement.

4. Capital Structure and Membership Interests

4.1 Conversion of Interests. Upon the Effective Time, shares, partnership interests or other ownership interests in the Converting Entity shall be converted into membership interests of the Resulting LLC on the terms and in the amounts set forth in the Plan of Conversion. The Resulting LLC shall issue certificates or other evidence of membership pursuant to its Operating Agreement and applicable law.

4.2 No Dilution. Except as expressly provided in this Agreement or the Plan of Conversion, no additional rights shall be granted to any holder of membership interests which would dilute the rights of any other holder without the holder's prior written consent.

5. Transfer of Assets and Assumption of Liabilities

5.1 Transfer of Assets. At the Effective Time, all property, rights, privileges, interests, claims and causes of action of the Converting Entity shall be vested in the Resulting LLC without reversion or impairment and without further act or deed.

5.2 Assumption of Liabilities. At the Effective Time, the Resulting LLC shall assume all of the liabilities and obligations of the Converting Entity as set forth in the Plan of Conversion, and such liabilities shall continue as obligations of the Resulting LLC subject to applicable law.

6. Tax Treatment

6.1 Tax Classification. The parties intend that the conversion shall be treated for U.S. federal income tax purposes in the manner specified in the Plan of Conversion. The Converting Entity and the Resulting LLC shall cooperate in good faith to obtain any tax rulings or determinations the parties agree are reasonably necessary to effect the intended tax treatment.

6.2 Tax Filings. The Resulting LLC shall prepare and file any tax returns required for reporting the conversion for periods beginning on or after the Effective Time, and the Converting Entity shall prepare and file all tax returns for periods ending prior to the Effective Time, except as otherwise required by applicable law.

7. Representations and Warranties

7.1 Converting Entity Representations. The Converting Entity represents and warrants to the Resulting LLC that: (a) it is duly organized, validly existing and in good standing in its jurisdiction of organization; (b) it has full corporate or entity power and authority to enter into and perform this Agreement; (c) this Agreement has been duly authorized, executed and delivered and constitutes a valid and binding obligation enforceable in accordance with its terms; and (d) the execution and performance of this Agreement will not violate any material agreement, law or court order to which the Converting Entity is subject.

7.2 Resulting LLC Representations. The Resulting LLC represents and warrants that, as of the Effective Time and to the extent within its control, it will be organized and in existence under the laws of the state of organization and will have the capacity to assume the assets and liabilities transferred pursuant to this Agreement.

8. Approvals and Conditions

8.1 Approvals. The obligations of the parties under this Agreement are subject to the approval of such corporate or other approvals as required by the governing documents of the Converting Entity and by applicable law. Each party shall use commercially reasonable efforts to obtain such approvals.

8.2 Conditions Precedent. The obligations of the parties are subject to the conditions set forth in the Plan of Conversion and to the absence of any legal impediment to the effectiveness of the conversion.

9. Further Assurances

9.1 Further Actions. Each party shall execute and deliver, or cause to be executed and delivered, such other instruments and take such other actions as may be reasonably necessary or desirable to carry out the purposes and intent of this Agreement, including the filing of required documents with governmental authorities and the transfer of titles, registrations and accounts.

10. Indemnification

10.1 Indemnification by Converting Entity. The Converting Entity shall indemnify and hold harmless the Resulting LLC, its members, managers and affiliates from and against any claims, losses, liabilities or expenses arising out of events or occurrences prior to the Effective Time, including breaches of representations or warranties set forth in this Agreement.

10.2 Indemnification by Resulting LLC. The Resulting LLC shall indemnify and hold harmless the Converting Entity and its affiliates from and against claims, losses and liabilities arising after the Effective Time that relate to acts or omissions of the Resulting LLC following conversion, except to the extent such claims relate to matters expressly assumed under this Agreement.

11. Notices

Notices to Converting Entity:

Notices to Resulting LLC:

Notices shall be delivered by hand, reputable overnight courier, certified mail (return receipt requested), or by electronic transmission when receipt is acknowledged, and shall be effective upon receipt in accordance with the notice addresses provided above or such other address as a party may specify by notice in accordance with this Section.

12. Amendments

12.1 Amendment. This Agreement may be amended, modified or supplemented only by a written instrument executed by each party hereto. No oral modification shall be binding on any party.

13. Waiver

13.1 Waiver. No waiver by any party of any breach or default shall be a waiver of any subsequent breach or default. Any waiver must be in writing and signed by the party granting the waiver.

14. Governing Law

14.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of , without regard to conflict of laws principles that would result in the application of the laws of another jurisdiction.

15. Entire Agreement

15.1 Entire Agreement. This Agreement, together with the Plan of Conversion and the documents referenced herein, constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations and discussions, whether oral or written, of the parties.

16. Severability

16.1 Severability. If any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby, and the parties shall negotiate in good faith to agree on a substitute provision to effect the original intent.

17. Counterparts

17.1 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures transmitted by electronic means shall be deemed originals for all purposes.

18. Miscellaneous

18.1 Further Assurances; Interpretation. The parties shall cooperate and take such actions as are reasonably necessary to effectuate the conversion. Headings are for convenience only and shall not affect interpretation. Unless the context otherwise requires, references to Sections are to sections of this Agreement.

18.2 Survival. The representations, warranties, covenants and agreements contained in this Agreement shall survive the Effective Time to the extent provided herein.

Sign Now