Article XIII – Miscellaneous
Deep Dive: Article XIII – Miscellaneous
Section 13.01 – Expenses
Layman’s translation:
Each side pays its own legal and other costs unless this Agreement says otherwise.
Pros ✅
- Prevents unexpected bills: no party picks up another’s defense costs beyond indemnity.
Cons ⚠️
- In a dispute over enforcement or amendment, you bear your own fees, even if you win—nothing shifts costs to the loser.
Risk:
- Chills meritorious claims or defenses because there’s no “fee-shifting” deterrent for bad-faith litigation.
Section 13.02 – Further Assurances
Layman’s translation:
Everyone promises to sign any papers needed later to carry out the deal.
Pros ✅
- Keeps the door open to fix oversights or clarify intent.
Cons ⚠️
- Too broad: could let PV Legacy request endless side-deals or micro-amendments.
Risk:
- Without limits, “further assurances” can be used as a lever for unrelated concessions.
Section 13.03 – Confidentiality
Layman’s translation:
Members and managers must keep Company trade secrets private—even after they leave—but can disclose if legally compelled or to advisors who sign the same NDA.
Pros ✅
- Protects sensitive financials, valuation data, legal strategy.
Cons ⚠️
- No time-limit: obligations survive indefinitely.
- No carve-out for benign disclosures (e.g., to estate planning counsel with broad-base confidentiality).
Risk:
- Could trap you in disputes if PV Legacy or their advisors stretch “Confidential Information” to block or delay transparency.
Section 13.04 – Notices
Layman’s translation:
All formal communications must be in writing and follow the address and delivery rules listed here.
Pros ✅
- Sets clear rules for triggering cure periods, defaults, votes, etc.
Cons ⚠️
- No email-only option—“written and signed” can slow urgent communications.
- No “deemed received” clause for email, so a single lost fax or postal delay can create a default.
Risk:
- A malicious Member can refuse to acknowledge or “lose” notices as leverage.
Sections 13.05–13.07 – Headings, Severability, Entire Agreement
Layman’s translation:
- Headings are just for convenience.
- If a provision is invalid, the rest still stands and we’ll renegotiate the broken part.
- This Agreement (plus Certificate of Formation) is the complete deal—no side-letters count.
Pros ✅
- Prevents sneak-in side-deals.
- Keeps the Agreement modular so one bad clause won’t kill the whole contract.
Cons ⚠️
- “Renegotiate” isn’t explicit—only “construe” to effect original intent, which may not solve the gap.
Risk:
- A critical clause struck down by a court could lead to unpredictable rewrites rather than a clear fix.
Sections 13.08–13.09 – Successors, No Third-Party Beneficiaries
Layman’s translation:
Rights and obligations bind successors/assigns but not outside creditors or guests.
Pros ✅
- Shields Company from third-party claims.
Cons ⚠️
- No carve-out for Permitted Transferees who need recognition as de facto Members; they might claim rights outside the deal.
Risk:
- A transferee affiliate could assert unexpected rights not spelled out here.
Sections 13.10–13.11 – Amendment & Waiver
Layman’s translation:
- Any change needs vote by Members holding at least a Majority in Interest (90%).
- A waiver must be in writing and only covers the specific instance.
Pros ✅
- High bar (90%) for amendments protects you from surprise changes.
- Written-only waiver prevents informal drift.
Cons ⚠️
- 90% = PV Legacy’s 24.4% blocks any amendment until you buy them out or they default.
- No distinction between routine and fundamental amendments; everything is locked at 90%.
Risk:
- PV Legacy can sit on its 24.4% veto block and prevent any fix to the Agreement—unless they default and you exercise buy-out rights.
Sections 13.12–13.14 – Governing Law, Jurisdiction, Jury Trial Waiver
Layman’s translation:
- Delaware law applies.
- Venue in Eau Claire, WI.
- No jury trial in any lawsuit.
Pros ✅
- Predictable legal regime and forum.
- Speeds cases—bench trials only.
Cons ⚠️
- Split between Delaware law and Wisconsin courts adds complexity.
- Jury waiver may be overbroad, even in statutory disputes where a jury is available.
Risk:
- Choice-of-law vs. venue mismatch can spawn preliminary motions, delays, higher costs.
Sections 13.15–13.16 – Equitable Remedies & Cumulative Rights
Layman’s translation:
- You can seek injunctions, specific performance, etc., without posting bond.
- All remedies (legal and equitable) stack together.
Pros ✅
- Gives you powerful court tools to stop breaches.
- Ensures you can pursue multiple remedies (e.g., injunction plus damages).
Cons ⚠️
- No bond required—good for you, but potentially abused by PV Legacy to freeze your actions.
Risk:
- PV Legacy could pursue aggressive injunctions in bad faith, knowing you can’t require a bond.
Section 13.17 – Counterparts
Layman’s translation:
Agreements can be signed in multiple copies and by fax or PDF—each is valid.
Pros ✅
- Facilitates rapid execution, especially with remote parties.
Cons ⚠️