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FILED: NEW YORK COUNTY CLERK 06/28/2023 03:21 PM INDEX NO. 451549/2023
NYSCEF DOC. NO. 293 RECEIVED NYSCEF: 06/28/2023
WALDROPT EXHIBIT 9
FILED: NEW YORK COUNTY CLERK 06/28/2023 03:21 PM INDEX NO. 451549/2023
NYSCEF DOC. NO. 293 RECEIVED NYSCEF: 06/28/2023
OPERATING AGREEMENT
OF
LIGHT OPERATIONAL HOLDINGS ASSOCIATES LLC
OPERATING AGREEMENT (the “Agreement”) of Light Operational Holdings
Associates LLC (the “Company”) made as of the 15th day of December, 2015, by and between
Kenneth Rozenberg and Beth Rozenberg (hereinafter collectively the “Members” and individually
as a “Member”).
WITNESSETH
WHEREAS, the Company has been formed pursuant to the provisions of the New
York Limited Liability Company Act (the “Act”), by having its articles of organization (the
“Articles of Organization”) filed with the Secretary of State of the State of New York on December
11, 2015; and
WHEREAS, the Members desire to adopt this Operating Agreement (the
“Agreement”) for the operation and management of the Company.
NOW, THEREFORE, in consideration of the agreements and obligations set forth
herein, the Members hereby agree as follows:
1. Formation, Name and Place of Business.
A. This Operating Agreement shall become effective upon the execution
hereof.
B. The terms and provisions hereof will be construed and interpreted in
accordance with the terms and provisions of the Act and, if any of the terms and provisions of this
Agreement should be deemed inconsistent with those of the Act, the Act shall be controlling.
C. The business of the Company will be conducted, subject to regulatory
approval, under name(s) designated by the Managing Member hereinafter mentioned.
D. The place of business of the Company will be initially located at 4770
White Plain Road, Third Floor, Bronx, New York 10470.
E. The parties hereto shall execute such certificates and documents, and
the Members shall file and record such certificates and documents, as may be necessary or
appropriate to comply with the requirements for the continuance and operations of a limited liability
company under the Act. The parties hereto shall also execute such certificates and documents, and
the Members shall file, record and publish such certificates and documents, as the Members, upon
advice of counsel, deem necessary or appropriate to comply with requirements of applicable laws
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governing the formation and operation of a limited liability company in all other jurisdictions where
the Company desires to conduct business.
2. Term.
The Company commenced doing business on the date on which the Articles
of Organization were filed with the Secretary of State of the State of New York. The Company
shall continue in existence unless sooner dissolved and wound up pursuant to the Act or any
provisions of this Agreement.
3. Purposes and Powers.
The powers and purposes of the Company are to engage in any and all activities as are
permitted under the Act and to own membership interests in and to New York limited liability
companies which own and operate New York State Department of Health licensed nursing homes
and to exercise all powers enumerated in the Act necessary or convenient to the conduct, promotion
or attainment of the foregoing business or purposes.
4. Members.
A. The names and addresses of the Members and their initial respective
Percentage Interests in the Company are set forth on Schedule A, attached hereto.
B. No person or entity may own ten percent or more of any membership
interest or voting right unless approved by the Public Health and Planning Council.
5. Management.
The business and affairs of the Company shall be exclusively managed by
Kenneth Rozenberg, the managing member of the Company (the “Managing Member”). The
Managing Member of the Company must be a Member of the Company. The Managing Member
shall have full and complete authority, power, and discretion to manage and carry out the business
of the Company, to make all decisions regarding those matters and to perform any and all other acts
or activities customary to or incident to the day-to-day management of the Company’s business.
Neither the management structure, nor this Section 5, may be deleted, modified or amended without
State of New York Department of Health approval.
6. Capital Contribution; Additional Capital Contributions.
A. Each Member’s initial capital contribution is set forth on
Schedule A annexed hereto. The amounts set forth on Schedule A shall constitute the initial capital
of the Company. The Company shall maintain a capital account for each Member (a “Capital
Account”). The opening balance of each Capital Account shall consist of such Member’s initial
capital contribution. Each Capital Account shall be adjusted by the amount of any additional
contributions of capital by, or distributions to, such Member and any allocation of profits and losses
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pursuant to Section 8 hereof.
B. The Members acknowledge that the Company may require additional
capital. If such determination is made by those Members holding a majority in interest of the
Percentage Interests, the Company shall send a notice to each Member stating the aggregate amount
of the additional capital required (the “Capital Call”) and the amount required to be contributed by
each Member, determined by multiplying (1) each Member’s Percentage Interest by (2) the
aggregate amount of the Capital Call (“Capital Call Share”).
C. If a Member shall not contribute an amount equal to his Capital Call Share
(the “Failing Member”), and if the other Member(s) (the “Non-Failing Member(s)”) have made
their entire required contributions, then the Non-Failing Member(s) may make the additional
contribution that the Failing Member was to make to the Company, pro rata in accordance with each
Non-Failing Member’s Percentage Interest(s) (the “Additional Contributions”).
In such event the Non-Failing Member(s) shall be entitled to receive the return of their Additional
Contributions before the Failing Member shall receive any distributions. In addition, the Percentage
Interest of each Failing Member shall be decreased to a percentage equal to a number expressed in
fractional terms, the numerator of which is the aggregate capital contributions made by the Failing
Member and the denominator of which is equal to the total sum of (i) all capital contributions made
by all Members prior to this Capital Call plus (ii) a number equal to the aggregate of all Additional
Contributions made pursuant to this Capital Call multiplied by 150%. The Percentage Interest of
the Non-Failing Members shall be increased, pro rata to their relative Additional Contributions, by
an amount equal to the percentage decrease in the Percentage Interest of the Failing Member
pursuant to the preceding sentence.
D. A Member shall not be entitled to withdraw any part of such Member’s
Capital Account or to receive any distribution from the Company, except as provided in this
Agreement. Except as set forth in C above, no Member shall have priority over any other Member
either for the return of Capital Contributions or for distributions of All Cash Available for
Distribution (as hereinafter defined).
7. Distributions.
A. “All Cash Available for Distribution” shall mean all cash receipts of the
Company remaining after the payment of (i) all operating expenses, (ii) outstanding Member loans
(if any), including the interest thereon, and (iii) such reasonable reserves the Managing Member
may set aside for working capital requirements.
B. Subject to the provisions of 6 C above, All Cash Available for
Distribution shall be distributed to the Members in accordance with their respective Percentage
Interests at such time and in such amount as the Managing Members shall determine in his sole
discretion.
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8. Allocation of Profits and Losses.
A. Except as herein otherwise expressly provided, for purposes of this
Agreement the terms “Profits” and “Losses” shall mean the net profits and losses of the Company
as determined separately, and not cumulatively, for each fiscal year of the Company by the
Company’s accountants in accordance with the accounting methods followed by the Company for
Federal income tax purposes.
B. Except as herein otherwise expressly provided, the Profits and Losses
of the Company (including each item of income, gain, loss, deduction or credit entering into the
computation thereof) shall be allocated for each year by crediting the Capital Account of each
Member with any Profits in accordance with such Member’s Percentage Interest, and charging the
Capital Account of each Member with any Losses as follows: first to all Members with positive
Capital Accounts proportionately until such Capital Accounts are reduced to zero, then to each
Member in accordance with such Member’s Percentage Interest.
C. Except as herein otherwise expressly provided, allocations of Profits
and Losses upon the liquidation and dissolution of the Company shall be made, to the extent
possible, so as to create balances in the Members’ Capital Accounts equal to zero.
D. Notwithstanding the foregoing, to the extent that Section 704(b) and
(c) of the Internal Revenue Code of 1986, as amended (the “Code”), requires allocations of income
or loss of the Company in a manner different than that set forth above, the Company shall use any
permissible method contained in the Treasury Regulations promulgated under Code Section 704(b)
and (c) that is selected by the Managing Members.
E. All allocations of Profits and Losses shall be made as of the last day
of each fiscal year of the Company; provided, however, that if during any fiscal year of the
Company or any portion thereof there is for any reason a change in any Member’s interest in the
Company, then Profits and Losses for such year shall be allocated among the Members based upon
the number of days during such period that such Member was registered as the owner of such
interest or in such other manner as the Managing Members deem appropriate in accordance with
requirements of the Code and of regulations issued pursuant thereto.
9. Transfer of Percentage Interests; Sale of Facility.
A. Notwithstanding anything to the contrary in the Articles of Organization or the
Operating Agreement, all transfers, assignments or other dispositions of membership interests or
voting rights, including any such transfers, assignments or dispositions under this Section or Section
6(D) hereof, shall be effectuated, to the extent applicable, in accordance with Public Health Law §
2801-a(4)(b) or any successor statute thereto.
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B. Except as provided in this Agreement, a Member may not gift, sell,
assign, pledge, encumber, hypothecate, exchange, transfer or otherwise dispose some or all of his
Percentage Interest in the Company. Subject to the provisions of G below, a Member may gift,
transfer and assign some or all of his Percentage Interest in the Company, in the case of a natural
Member, to such Member’s Immediate Family Members and in the case of an entity Member, to
such entity Member’s affiliates or employees. Except as set forth hereinabove but subject to the
provisions of G below, a Member desiring to assign, transfer, sell or otherwise dispose of some or
all of his Percentage Interest (the “Selling Member”) shall first obtain a bona fide written offer from
a prospective purchaser of such Percentage Interest stating the terms and conditions upon which the
proposed purchase is to be made. The Selling Member shall then give the other Members (the
“Remaining Members”) written notice (the “Offer Notice”) of his intention to so sell to such
proposed purchaser along with a copy of such bona fide written offer. Each Remaining Member,
other than the Selling Member, on a basis pro rata to the Percentage Interests of each Remaining
Member exercising his right of first refusal, shall have the right to exercise a right of first refusal to
purchase all (but not less than all) of the Percentage Interests proposed to be sold by the Selling
Member upon the same terms and conditions as stated in the bona fide written offer by giving
written notification to the Selling Member of his intention to do so within sixty (60) days after
receiving the written notice from the Selling Member. The failure of any Remaining Member to so
notify the Selling Member of a desire to exercise such right of first refusal within such sixty (60)
day period shall result in the termination of such Remaining Member’s right of first refusal and the
Selling Member shall be entitled to consummate the sale of his Percentage Interests with respect to
which such first right of refusal has not been exercised to the proposed purchaser offering to do so
pursuant to the bona fide written offer to purchase and upon no other terms or conditions. Any
changes in any of the terms or conditions of the written bona fide offer shall require the Selling
Member to re-offer the Percentage Interests to the Remaining Members who shall again have the
right of first refusal pursuant to the provisions of this Section. If the Selling Member does not sell
his Percentage Interests in accordance with the written bona fide offer within thirty (30) days after
receiving the right to do so, his right to do so terminates and the terms and conditions of this Section
shall again be in effect with respect to his Percentage Interests. If a Remaining Member gives
written notice to the Selling Member of his desire to exercise his right of first refusal and to
purchase the Selling Member’s offered Percentage Interest upon the same terms and conditions as
are stated in the bona fide written offer, such Remaining Member shall have the right to designate
the time, date and place of closing for the closing to occur within ninety (90) days after receipt of
written notification from the Selling Member of the bona fide offer.
C. Except for transfers to Immediate Family Members or in the case of an entity Member,
to such entity Member’s affiliates or employees, no person acquiring a Percentage Interest, other
than a Member, shall become a Member unless such person is approved by the vote or consent of at
least sixty (60%) percent of all the Percentage Interests (excluding the Percentage Interests acquired
by such person). If no such approval is obtained, such person’s Percentage Interests shall only
entitle such person to receive the distributions and allocations of profits and losses to which the
Member from whom such person received such Percentage Interests would be entitled. Any such
approval may be subject to any terms and conditions imposed by the Members. It shall be an
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additional condition of any transfer that the transferee (if not already a party to this Agreement)
become a party to this Agreement by delivering to each of the Members a counterpart of this
Agreement signed by such transferee.
D. Notwithstanding anything in this Agreement to the contrary, but subject to
the provisions of 6 C hereof, no additional Percentage Interests shall be issued and no Member’s
Percentage Interests shall be reduced without the consent of at least sixty (60%) percent of all the
Percentage Interests.
E. For purposes of this Agreement, the term “Immediate Family Members”
shall mean a spouse, sibling, parent or child.
F. Notwithstanding anything in this Agreement to the contrary, no sale of all
or substantially all of the assets of the Company may occur without the consent of at least sixty
(60%) percent of all the Percentage Interests.
G. Notwithstanding anything to the contrary, it is agreed that: (i) anyone who
hereafter becomes a Member of the Company and who is employed by the Company or its affiliates
(each an “Employee Member” and collectively the “Employee Members”) may not howsoever gift,
sell, assign, pledge, encumber, hypothecate, exchange, transfer or otherwise dispose of all or any
portion of their respective Percentage Interests in the Company without the consent of the
Managing Member, which consent may be withheld for any or no reason, and that the foregoing
restriction shall apply to gifts, transfers or any other form of alienation of all or any portion of the
Percentage Interests to the Immediate Family Members of any Employee Member; (ii) immediately,
automatically and without any further action by or notice to an Employee Member, upon the
termination of such Employee Member’s employment with the Company or with any of its
affiliates, such Employee Member’s Percentage Interest in the Company shall by virtue of this
provision be assigned to and shall revert to the Company without any additional consideration
payable to such Employee Member and without any additional documents of conveyance or
assignment, it being agreed that this provision shall act as and for an irrevocable, assignment,
authorization and consent by each Employee Member to the foregoing assignment and reversion to
the Company and as a power of attorney (coupled with an interest) hereby granted to the Managing
Member on behalf of each Employee Member to effectuate any such assignment and reversion as
set for hereinabove and to execute any documents and instruments on behalf of each Employee
Member as the Managing Member may deem necessary or desirable to effectuate the intent and
purpose of this provision; (iii) unless and until all the other Members of the Company receive the
full return of all capital sums they invested and/or advanced/loaned to the Company, the Employee
Members shall not be entitled to receive any distributions from the Company.
10. Dissolution and Winding Up.
A. The Company shall be dissolved upon the earliest to occur of (i) the
expiration of the term set forth in Section 2; (ii) the agreement of those Members holding sixty
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(60%) percent of the Percentage Interests to dissolve the Company; (iii) death, dissolution,
insolvency, incompetence, or bankruptcy of a Member, unless the remaining Members consent to
continue the business of the Company within 90 days after such event affecting a Member; (iv) the
sale of all or substantially all of the assets of the Company and the collection and distribution of the
proceeds of sale; (v) any event which makes it impossible, unlawful, or impractical to carry on the
business of the Company; or (vi) entry of a decree of judicial dissolution of the Company under the
Act.
B. Upon the dissolution of the Company, it will be wound up and
liquidated, and the assets shall be distributed as follows: (i) all of the Company’s debts and
liabilities to persons other than the Members shall be paid and discharged; (ii) the Managing
Member (or a trustee if one is appointed) may set up any reserve he deems reasonably necessary for
any contingent or unforeseen liabilities or obligations of the Company to persons other than the
Members arising out of or in connection with the Company. Such reserve shall be paid over by the
Managing Member (or such trustee) to a bank or trust company to act as escrow agent or to a
reputable person selected by the Managing Member (or such trustee). Any such escrow agent shall
hold such reserve for payment of any of the aforementioned contingencies, and, at the expiration of
such period as the Managing Member (or such trustee) designate, distribute the balance thereafter
remaining in the manner hereinafter provided; (iii) all of the Company’s indebtedness to the
Members shall be paid and discharged; (iv) subject to the provisions of 6 C above, the Members
shall be paid the value of their Capital Accounts; and (v) a proportionate share of each class of asset
of the Company that may be divided among the Members, and an undivided interest in each and
every other asset of the Company, shall be distributed to the Members in accordance with their
Percentage Interests after allocation of Profits and Losses attributable to, or arising from, liquidation
of the Company, treating the Company as if all assets not sold had been sold for their fair market
value immediately prior to a distribution upon dissolution of the Company, all Profits and Losses
had been allocated in accordance with the provisions of this Agreement and all items of income,
deduction or loss had been credited or charged to the Capital Accounts of the Members as provided
in Section 8 hereof.
C. The winding up of the Company’s affairs and liquidation and
distribution of its assets shall be conducted exclusively by the Managing Member (or a trustee, if
one is appointed), who are authorized to do any and all acts and things authorized by law for these
purposes.
11. Banking.
The Managing Member at any time and from time to time on behalf of the
Company, may open such bank accounts, make such deposits therein and acquire for investment
such certificates of deposit, United States Treasury Bills, commercial paper and other similar short-
term debt obligations as he shall determine in their sole and absolute discretion. All withdrawals
from any bank accounts so maintained may be made only upon the signatures of the Managing
Member or his designee(s).
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12. Liability and Indemnification.
A. Except as otherwise provided by law, the Members, including the
Managing Member, shall not be liable, responsible, or accountable in any way for damages or
otherwise to the Company or to any of the Members for any act or failure to act pursuant to this
Agreement or otherwise unless there is a judicial determination that (i) such person acted in bad
faith, (ii) the conduct of such person constituted intentional misconduct or a knowing violation of
law, (iii) such person gained a financial benefit to which he or she was not legally entitled, or (iv)
such person failed to perform his or her duties, specifically with respect to distributions under
section 508(a) of the Act, in good faith and with that degree of care that an ordinarily prudent
person in a like position would use under similar circumstances.
B. The Company shall indemnify, defend, and hold harmless each of the
Members, including the Managing Member, (severally, the “Indemnitee” and collectively, the
“Indemnitees”), from and against any claims, losses, liabilities, damages, fines, penalties, costs, and
expenses (including, without limitation, reasonable fees and disbursements of counsel and other
professionals) arising out of or in connection with any act or failure to act by an Indemnitee
pursuant to this Agreement, or the business and affairs of the Company to the fullest extent
permitted by law; provided, however, that an Indemnitee shall not be entitled to indemnification
hereunder if there is a judicial determination that (a) such Indemnitee’s actions or omissions to act
were made in bad faith or were the result of active and deliberate dishonesty and were material to
the cause of action so adjudicated, or (b) such Indemnitee personally gained a financial benefit to
which the Indemnitee was not legally entitled.
C. No Member, including Managing Member, shall be liable for any
debts, obligations or liabilities of the Company or each other, whether arising in tort, contract or
otherwise, solely by reason of being such Member or acting (or omitting to act) in such capacity or
participating in the conduct of the business of the Company.
13. Books and Records.
Proper and complete books and records of account of the Company shall be
kept at its principal place of business or such other place as determined by the Managing Member
and shall be open for inspection and copying by any Member in person or by his duly authorized
representatives, upon reasonable notice provided to the Managing Member during regular business
hours at such principal place of business. The Company shall deliver to each of the Members an
annual statement reflecting the financial affairs of the Company in reasonable detail, shall prepare
the Company’s income tax returns and shall distribute to each of the Members information with
respect to the Company necessary for each Member to prepare his individual Federal and State
income tax returns.
14. Basis Adjustment.
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In the event of a transfer of an interest in the Company or the distribution of
any property to a Member, upon the request of the transferee or distributee, the Managing Member
may elect on behalf of the Company under Code Section 754 to cause the basis of the Company’s
property to be adjusted for Federal income tax purposes in the manner provided in Code Sections
734 or 743, as the case may be.
15. Communications.
Any notice, request or demand required or permitted under this Agreement
shall be deemed to have been duly given or made if in writing and (i) delivered in person or (ii) five
days after deposit in the U.S. mail if sent postage prepaid by registered or certified mail, return
receipt requested, or (iii) if sent by overnight courier service, in the case of a Member, to the
address of such Member then shown on the books and records of the Company.
16. Severability.
If any provision of this Agreement shall be determined to be invalid, illegal
or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions
contained herein shall not in any way be affected or impaired thereby and shall continue to be
enforceable to the fullest extent permitted by law.
17. Binding Effect.
This Agreement shall be binding upon and inure to the benefit of the parties,
their heirs, devisees, personal representatives, successors and assigns.
18. Completeness and Modifications.
This Agreement embodies the entire understanding and agreement among the
Members concerning the Company, and supersedes any and all prior negotiations, understandings
or agreements in regard thereto. No waiver or modification of the terms hereof shall be valid unless
in writing and signed by those Members to be charged and only to the extent therein set forth.
19. Tax Matters Partner.
Kenneth Rozenberg is hereby designated as the “Tax Matters Partner” under
the Code.
20. Gender and Number.
Where appropriate, the masculine gender shall be deemed to include the
feminine, the feminine gender shall be deemed to include the masculine, the singular number shall
be deemed to include the plural and the plural number shall be deemed to include the singular.
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21. Construction.
This Agreement shall be governed by, and construed in accordance with, the
laws of the State of New York.
22. Creditors.
Except as specifically set forth in this agreement, none of the provisions of
this Agreement shall be for the benefit of, or enforceable by, any creditor of the Company or any
creditor of any Member or any other third party.
23. Counterparts.
This Agreement may be executed in one or more original, facsimile or PDF
counterparts, all of which taken together shall constitute a single agreement.
24. Legal Representation.
The Members acknowledge that this Agreement has been prepared on behalf of
the Company by the Company’s counsel and that such counsel has not represented any of the individual
Members in connection therewith. Each Member further acknowledges and certifies that they have
thoroughly read and fully understand all the provisions contained herein and have been advised and had
the opportunity to have this Agreement reviewed by independent and separate counsel of their own
selection and have done so prior to the execution of this Agreement. As such, no preference or weight
shall be given to who prepared or drafted this Agreement, as it is the understanding of the parties hereto
that all parties had a full right to negotiate and discuss the preparation, drafting and revisions and
signing of this Agreement between themselves and their respective attorneys and have done so.
SIGNATURE PAGE FOLLOWS
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LIGHT OPERATIONAL HOLDINGS ASSOCIATES LLC
SCHEDULE A
MEMBERS PERCENTAGE INTERESTS INITIAL CAPITAL
Kenneth Rozenberg 95.00% $1,900.00
3 Hunters Run
Suffern, NY 10901
Beth Rozenberg 5.00% $ 100.00
3 Hunters Run
Suffern, NY 10901