Exhibit 10.1

 

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*Portions of this exhibit have been omitted and filed separately with the
Securities and Exchange Commission.  Such portions have been omitted pursuant to
a request for confidential treatment.

 

AMENDED AND RESTATED

LIMITED LIABILITY COMPANY AGREEMENT OF

SSA TERMINALS, LLC

 

THIS AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT is entered into as
of this 24th of April, 2002, by and between SSA Ventures, Inc. ,a Washington
corporation (“SSA Ventures”), and Matson Ventures, Inc., a Hawaii corporation
(“MVI”).

 

RECITALS:

 

A.                    By their mutual consent, SSA Pacific Terminals, Inc., a
Washington corporation formerly known as Stevedoring Services of America, Inc.
(“SSA”), and Matson Navigation Company, Inc., a Hawaii corporation (“Matson”),
caused a certificate of formation for SSA Terminals, LLC, a limited liability
company (“LLC”), to be filed under the laws of the State of Delaware on June 24,
1999.

 

B.                    SSA and Matson entered into a Limited Liability Company
Agreement of SSA Terminals, LLC on July 9, 1999 (the “Initial Agreement”),
pursuant to which SSA and Matson set forth in writing the terms and conditions
on which the LLC was formed, and on which its business was to be conducted.

 

C.                    Following the execution and delivery of the Initial
Agreement on July 9, 1999, SSA assigned to SSA Ventures SSA’s rights to become a
member of, and to receive a limited liability company interest in the LLC, and
Matson assigned to MVI, Matson’s rights to become a member of, and to receive a
limited liability company interest in the LLC.  On July 10, 1999, SSA Ventures
and MVI contributed certain assets to the LLC as Members thereof.

 

D.                    SSA Ventures and MVI desire to amend and restate the
Initial Agreement on the terms and conditions set forth in this Amended and
Restated Limited Liability Company Agreement.

 

NOW, THEREFORE, in consideration of the mutual promises of the parties, each to
the other, and of other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby amend and
restate the LLC Agreement in its entirety to read as follows:

 

Section 1 - DEFINITIONS

 

As used in this Agreement, the following defined terms shall have the meanings
specified below:

 

1.1        “Act” means the Delaware Limited Liability Company Act, Delaware
Corporations Code, Section 18-101, et seq.

 

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1.2        “Affiliate” means a natural person, firm, partnership, limited
liability company, or corporation, who, directly or indirectly, through one or
more intermediaries, controls or is controlled by or is under common control
with a Member.  For purposes of this definition, the term “control” shall
include ownership of greater than twenty percent (20%) of the equity ownership
or voting control of an entity.

 

1.3        “Agreement” means this Limited Liability Company Agreement, as
initially executed, or as amended from time to time, as the context may require.

 

1.4        “Bankruptcy” shall mean, with respect to any person, the filing of a
voluntary or involuntary petition in bankruptcy by or against a Member pursuant
to Chapters 7 or 11 of the United States Bankruptcy Code, unless such petition
is denied or dismissed within thirty (30) days after filing in the case of a
voluntary petition, or within ninety (90) days after filing in the case of an
involuntary petition; the entry of an order of relief in bankruptcy of a person;
the assignment by a person of its Percentage Interest for the benefit of
creditors; the appointment of a receiver or trustee for a person’s property; and
the attachment of a person’s Percentage Interest which is not released within
thirty (30) days (unless such attachment has not resulted in the foreclosure or
transfer of such person’s Percentage Interests, such attachment is being
contested in good faith by appropriate proceeding diligently conducted, and such
person has set aside reserves adequate to respond to any claim giving rise to
any such attachment); or the undertaking by any person of any course or action
amounting to the commencement of liquidation or dissolution proceedings.

 

1.5        “Board of Managers” means the group of persons named as Managers of
the LLC, in accordance with Section 5.2.

 

1.6        “Capital Account” means the account established and maintained for
each Member on the books of the LLC pursuant to Section 6.5.

 

1.7        “Capital Contribution” means the total amount of money and the fair
book value or agreed market value of property (net of liabilities secured by
such property that the LLC is considered to assume or take subject to under Code
Section 752) actually contributed to the LLC by each Member pursuant to the
terms of this Agreement.  Any reference to the Capital Contribution of a Member
shall include the Capital Contribution made by a predecessor holder of the
interest of the Member.

 

1.8        “Code” means the Internal Revenue Code of 1986, as amended.

 

1.9        “Definitive Agreements” means this Agreement and the following
agreements entered into as of July 10, 1999 (a) by and between or among SSA,
Matson or MTI and the LLC:  (i) Stevedoring, Terminal, CFS, Vehicle Processing
and Maintenance and Repair Services Agreement, (ii) Contribution Agreement,
(iii) Administrative Services Agreement, (iv) Planning Services Agreement,
(v) Employee Lease Agreement, and (vi) Cooperative Working Agreement; and (b) by
and between the LLC and Homeport Insurance Company: Agreement for the Provision
of Insurance.

 

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1.10        “Fiscal Year”  means a fifty-two/fifty-three week period ending on
the last Friday in January.

 

1.11        “LLC” means SSA Terminals, LLC, formed and operated under the terms
and conditions of this Agreement.

 

1.12        “Major Decision” means a decision to:

 

(a)        Transfer greater than ten percent (10%) of the assets of the LLC;

 

(b)        Merge the LLC with any other entity;

 

(c)        Dissolve the LLC;

 

(d)        Acquire or dispose of an equity interest in any business;

 

(e)        Admit a new Member;

 

(f)        Approve an annual operating plan or budget of the LLC or a long-range
operating plan, and any amendments thereto;

 

(g)        Approve an annual capital expenditure budget and any amendments
thereto, and, separately, any capital project or capital expenditure in excess
of $500,000, if not included in the annual capital expenditure budget, or in
excess of $1,000,000, if included in the approved annual capital expenditure
budget;

 

(h)        Incur, guarantee or refinance any indebtedness or other liability
relating to financing, not included in the annual operating plan or budget;

 

(i)        Lend money, or receive, or hold real or personal property as security
for repayment of funds so loaned (except in connection with reasonable
relocation of employees in the ordinary course of business), or (other than in
the ordinary course of business) invest or reinvest LLC funds;

 

(j)        Engage in any business other than as set forth in Section 3.1;

 

(k)        Enlarge, decrease or otherwise change the number of members of the
Board of Managers, the scope of authority, power or decision-making of the Board
of Managers or otherwise alter, change or limit the manner in which the Board of
Managers operates or makes decisions;

 

(l)        Enlarge, decrease or otherwise change any right or obligation of the
Members, the scope of authority, power or decision-making of the Members, or
otherwise alter, change or limit the manner in which the Members operate or make
decisions hereunder;

 

(m)        Make additional capital contributions as specified in Section 6.3;

 

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(n)        Seek a loan or guaranty by a Member or Members, or any Affiliate
thereof, to or for the benefit of the LLC;

 

(o)        Make distributions of Net Cash Flow other than in compliance with
Section 8;

 

(p)        Select or terminate an independent certified public accounting firm;

 

(q)        Form a subsidiary entity or joint venture in which the LLC would hold
an equity interest; exercise the LLC’s interest in any such entity as to any
matter that would be considered a Major Decision or a matter for the decision of
the Managers under this Agreement had the decision been presented as to the LLC;
agree to or create any condition that would allow for any transfer in any
interest of the subsidiary entity or joint venture by either the LLC or any
other party; dissolve or create any condition that would allow the dissolution
of the subsidiary entity or joint venture; exercise any rights to obtain
property of the subsidiary entity or joint venture upon a dissolution; and make
decisions as to any other matters with respect to a subsidiary entity or joint
venture that either a Member or a Manager would have been entitled to vote on
under this Agreement had the matter been presented as to the LLC;

 

(r)        Enter into, amend or terminate a terminal lease agreement with a port
authority or other entity;

 

(s)        Change fundamentally the purpose of the LLC as described in
Section 3.1, or otherwise alter or change significantly the manner, place, or
way in which the LLC operates or conducts business;

 

(t)        Enter into, amend or extend a contract with a Member, or any of its
Affiliates, and compensate or reimburse a Member, or any of its Affiliates, in
accordance with Sections 4.3 and 4.4; or

 

(u)        Except with respect to those activities permitted as provided in
Section 12.11, allow a Member, or any Affiliate of a Member, to engage in the
business operations described in the first sentence of Section 3.1.

 

(v)        Conduct the business of the LLC without liability, property or
workers compensation insurance which a prudent operator of such a business would
obtain in the ordinary course of business;

 

(w)        Amend or otherwise alter any Definitive Agreement;

 

(x)        Initiate or settle any (i) material litigation or claim which is not
insured, or (ii) assessment, litigation or claim relating to taxes, or
(iii) material regulatory investigation or audit; provided, however, that
(x) any Member other than SSA Ventures, or any Affiliate thereof, may
unilaterally initiate and conduct any litigation or claim against any non-LLC
party to any agreement referred to in Section 1.9(a)(ii), (iii), (iv), (v) and
(b), or entered into between the LLC and SSA, or any Affiliate thereof, pursuant
to Section 4.4; (y) any Member other than MVI, or any Affiliate thereof, may
unilaterally initiate and conduct any litigation or claim against any non-LLC

 

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party to any agreement referred to in Section 1.9(a)(i) or (ii) or entered into
between the LLC and Matson, or any Affiliate thereof, pursuant to Section 4.4;
and (z) any Member may unilaterally initiate or conduct any claim against
another Member, or any of its Affiliates thereof, for breach of this Agreement,
and in each such case the initiating party shall bear all costs, including the
other parties’ attorneys’ fees, if the initiating party does not prevail;

 

(y)        Exercise any option to renew the Administrative Services Agreement,
or the Agreement for the Provision of Insurance or the Planning Services
Agreement in accordance with the respective terms thereof; and

 

(z)        Take any other action under this Agreement which expressly requires
the unanimous approval, consent or action of the Members.

 

1.13        “Management Personnel” means the officers and/or senior management
employees of the LLC.

 

1.14        “Manager” means any person appointed a Manager in accordance with
Section 5.2, who shall have the rights, duties and powers of a Manager, as
described herein and under the Act.

 

1.15        “Member” means each of SSA Ventures and MVI, upon their respective
contributions pursuant to Section 6.1, and each other person who is approved as
a Member in the manner provided herein and who executes a counterpart of this
Agreement.

 

1.16        “Modified Net Cash Flow” means Net Cash Flow before deducting
payments of principal of long-term debt obligations.

 

1.17        “Net Cash Flow” means, in any fiscal period, calculated in
accordance with GAAP, (i) net income, (ii) increased by adding back deductions
for depreciation and amortization, (iii) reduced by expenditures for capital
additions or improvements to the extent not financed with borrowed funds from
long-term debt obligations, (iv) reduced by amounts set aside by the Board of
Managers as reserves for contingency funds not already reflected in net income,
and (v) further reduced by payments of principal of long-term debt obligations.

 

1.18        “Net Profit and Net Loss” shall mean, for each Fiscal Year, an
amount equal to the LLC taxable income or loss for such Fiscal Year, determined
in accordance with Code Section 703(a) (for this purpose, all items of income,
gain, loss, or deduction required to be stated separately pursuant to Code
Section 703(a) (1) shall be included in taxable income or loss), as adjusted in
accordance with Regulations Section 1.704-1(b)(2)(iv).

 

1.19        “Net Working Capital” shall mean, at the time of any determination
thereof, current assets minus current liabilities determined in accordance with
generally accepted accounting principles consistently applied.

 

1.20        “Percentage Interest” means a Member’s percentage ownership interest
in the LLC, which, as of January 26, 2002, shall be as set forth on Exhibit A. 
In the event any Member interest is transferred in accordance with the terms of
this Agreement, the transferee of such interest shall succeed to the Percentage
Interest of its transferor to the extent it relates to the transferred
interests,

 

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and the transferee, for purposes of this Section 1.20, shall be deemed to have
made the Capital Contribution made by the transferor to the extent it relates to
the transferred interest.

 

1.21        “Regulations” means the Treasury Regulations promulgated under the
Code from time to time by the Secretary of the Treasury.

 

Section 2 - ORGANIZATION

 

2.1        Formation.  This LLC was formed under and pursuant to the Act by
filing, on June 24, 1999, the Certificate of Formation.  Consistent with the Act
and the Certificate of Formation, the LLC will be operated pursuant to the terms
and conditions contained in this Agreement.

 

2.2        Management by Managers.  The Board of Managers shall manage this LLC
pursuant to Section 5.

 

2.3        Name.  The name of the LLC will be SSA Terminals, LLC.  The Members
may change the name of the LLC at any time, provided all provisions of the Act
are satisfied.

 

2.4        Fictitious Name Statements.  The Board of Managers will execute, and
cause to be filed in the appropriate offices, any fictitious-name or
doing-business statements or registrations that may be required by the laws of
any state, and any other certificates or documents the Board of Managers deems
necessary or appropriate to comply with the requirements for qualification and
operation of a limited liability company under the laws of the States of
Washington, Oregon or California or of any locality or other jurisdiction in
which the LLC does business or owns property.

 

2.5        Term.  The LLC will have perpetual existence unless the LLC is
dissolved pursuant to the provisions of Section 11.1.

 

2.6        Tax Treatment as a Partnership.  The Members intend that the LLC be
treated as a partnership under Regulation Section 301.7701-3 and analogous
provisions of state tax laws, and the LLC shall not elect to be treated as an
association taxable as a corporation.

 

Section 3 - PURPOSES OF THE LLC

 

3.1        Purposes.  The primary purpose of the LLC is to operate a container
stevedoring and terminal services business, and to expand that business in the
States of California, Oregon and Washington.  The LLC is authorized to acquire,
lease, repair, renovate, dispose of and own such assets or property as is
necessary or useful to the conduct of the LLC’s business.  In addition, the LLC
may engage in any other business or activity that is necessary, incidental or
related to the LLC’s primary purpose.

 

3.2        Authority of the LLC.  In order to carry out any of its purposes, the
LLC is authorized to take any lawful action consistent with any such purpose
that a limited liability company is permitted to take under the laws of the
State of Delaware.

 

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Section 4 - MEMBERS

 

4.1        Members.  The names and addresses of the Members are set forth on
Exhibit A, as the same may be amended from time to time.

 

4.2        Authority of Members.  In addition to taking any action reserved to
the Members by the Act or elsewhere in this Agreement, any Major Decision shall
require approval of all of the Members unless delegated by all of the Members to
the Board of Managers, and may not be taken unilaterally by any Member, or any
of its Affiliates.

 

4.3        Compensation.  Compensation or expense reimbursement from the LLC to
a Member, or any of its Affiliates, constitutes a Major Decision. No Member or
Affiliate shall be entitled to any compensation or expense reimbursement from
the LLC in connection with the LLC’s business unless the Members approve such
decision in the manner provided in Section 4.4.  The LLC will not pay any Member
for the service of any member, stockholder, director, partner or employee of
such Member for expenses incurred in traveling to and attending meetings of the
Members, the Board of Managers or other meetings or conferences of the LLC.  No
expenses for which a Member is responsible shall be charged to the LLC or the
other Members.

 

4.4        Related Agreements.  The Members acknowledge that they or their
Affiliates engage in business activities or provide services that may be of a
type that would be useful to the LLC and that the LLC may provide services to a
Member.  From time to time, the LLC may wish to conduct business with a Member
or its Affiliates, which decision shall constitute a Major Decision.  So long as
(a) the material terms of such arrangement are disclosed to the other Member and
the Board of Managers in advance, in the manner described below, and (b) the
arrangement is approved by the Members in the manner required for Major
Decisions, Members or their Affiliates may conduct business with the LLC.  Each
Member shall fully disclose or cause its Affiliate to fully disclose, in
writing, to the Board of Managers and the other Member all material details of
any transaction between the LLC and the Member or its Affiliate.  The fees and
other terms of any such agreement or arrangement shall be negotiated on an
arm’s-length basis.  The Members have determined that each Definitive Agreement
referred to in clause (a) of the definition of Definitive Agreement is an
arm’s-length agreement satisfying the requirements of this Section 4.4.  The
Members have further determined that the Agreement for the Provision of
Insurance is an arm’s-length agreement.

 

4.5        Annual Meeting. The Members shall hold an annual meeting for the
designation of participants on the Board of Managers and for the transaction of
such other business as may properly come before the meeting.  The annual meeting
of Members shall be held each year in the month of May, at Seattle, Washington,
on a date to be determined by the Members in accordance with this Section 4.5,
or at such other time and place to be set by the Members.  They shall advise the
Board of Managers of their determination and the Board of Managers shall send
written notice of the date, time and place of the meeting to each Member not
less than ten (10) nor more than sixty (60) days before the date of such
meeting.  Such notice may be transmitted via facsimile, U.S. mail or overnight
courier service.

 

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4.6        Special Meetings.  Special meetings of the Members for any purpose or
purposes may be called at any time by one or more Members, to be held at such
time and place as the Members may prescribe.

 

If a special meeting is called, then a written demand, describing with
reasonable clarity the purpose or purposes for which the meeting is called and
specifying the general nature of the business proposed to be transacted, shall
be delivered personally or sent by registered mail, by electronic mail (so long
as the Company retains a hard copy of a return receipt), or by telegraphic or
other facsimile transmission to the other Members.  Such notice shall be given
not less than ten (10) nor more than sixty (60) days before the date of the
meeting.  No business other than that specified in the notice may be transacted
at a special meeting.

 

4.7        Record Date.  Notice of a Members’ meeting shall be given to all
Members of record as of the date before such notice is sent.

 

4.8        Nonvoting Representatives.  At each meeting of Members, each Member
may, in its sole discretion, designate additional nonvoting representatives who
may attend all such Member meetings with the Member representative.  The
nonvoting representatives may participate in such Member meeting, but may not
vote on any matters considered by the Members.

 

4.9        Declaration of Mailing.  A declaration of the mailing or other means
of giving any notice of any Members’ meeting, executed by one or more Members,
shall be prima facie evidence of the giving of such notice.

 

4.10        Waiver of Notice.  A Member may waive notice of any meeting at any
time, either before or after such meeting.  Except as provided below, the waiver
must be in writing, be signed by the Member entitled to the notice, and be
delivered to the LLC for inclusion in the minutes or filing with the LLC
records.  A Member’s attendance at a meeting in person or by proxy waives
objection to lack of notice or defective notice of the meeting unless the Member
at the beginning of the meeting objects to holding the meeting or transacting
business at the meeting on the ground that the meeting is not lawfully called or
convened.  In the case of a special meeting, or an annual meeting at which
fundamental changes are considered, a Member waives objection to consideration
of a particular matter that is not within the purpose or purposes described in
the meeting notice unless the Member objects to considering the matter when it
is presented.

 

4.11        Quorum; Vote Requirement.  A quorum shall exist at any meeting of
Members if all Members are represented in person or by proxy.  Once a Member is
represented for any purpose at a meeting other than solely to object to holding
the meeting or transacting business at the meeting, the Member is deemed present
for quorum purposes for the remainder of the meeting and for any adjournment of
that meeting.

 

4.12        Action by Members Without a Meeting.  Any action which may be or
which is required by law to be taken at any meeting of Members may be taken,
without a meeting or notice of a meeting, if one or more consents in writing,
setting forth the action so taken, are signed by all of the Members.  Action
taken by written consent is effective when consents containing the signatures of
all Members are in possession of the LLC, unless the consent specifies a later

 

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effective date.  Such consent shall have the same force and effect as a meeting
vote of Members and may be described as such in any certificate or other
document filed with the Secretary of State of the State of Delaware.

 

4.13        Alternative Media for Conducting Meetings.  Members may participate
in a meeting by means of a conference telephone call, on-line facilities or
similar communications equipment by means of which all persons attending the
meeting can participate, and participation by such means shall constitute
presence in person at a meeting.

 

4.14        Limitation of Liability.  Each Member’s liability shall be limited
as set forth in this Agreement, the Act and other applicable law.  Except as
provided by law, a Member will not be personally liable for any debts or
liabilities of the LLC simply because of being a Member.  It is the mutual
intention of the Members that the LLC operate on a stand-alone and
fully-independent basis, and on the basis of its own assets and revenues, and
that neither Member will become liable, nor shall there be any recourse against
any Member, for any liability of the LLC, except to the extent of each Member’s
Percentage Interest in the assets of the LLC and as may otherwise be required by
law.

 

4.15        Restrictions on Authority of Members. Neither Member shall do any of
the following acts without the unanimous consent of the Members:

 

(a)                           Knowingly do any act in contravention of this
Agreement; or

 

(b)                           Knowingly perform any act that would subject any
Member, Manager or Affiliate of any or the same, or any employee of the same, to
personal liability in any jurisdiction.

 

4.16.        Indemnification.

 

(a)        Each Member (and any Affiliate thereof other than the LLC) and its
officers, directors and employees (hereinafter an “indemnitee”) who was or is
made a party or is threatened to be made a party to or is otherwise involved
(including, without limitation, as a witness) in any actual or threatened claim,
action, suit or proceeding, whether civil, criminal, administrative or
investigative and whether formal or informal (hereinafter a “proceeding”), by
reason of the fact that such indemnitee, or an Affiliate, is or was a Member of
the LLC, shall be indemnified and held harmless by the LLC to the full extent
permitted by applicable law as then in effect, against all expense, liability
and loss (including, without limitation, attorneys’ fees, judgments, fines,
ERISA excise taxes or penalties and amounts to be paid in settlement) incurred
or suffered by such indemnitee in connection therewith, and such indemnification
shall continue as to an indemnitee who, or whose Affiliate, has ceased to be a
Member or an officer, director or employee of a Member and shall inure to the
benefit of the indemnitee’s successors in interest; provided, however, that no
indemnification shall be provided to any such indemnitee if the LLC is
prohibited by the Act or other applicable law as then in effect from paying such
indemnification; and provided, further, that except as provided in
Section 4.16(a), with respect to proceedings seeking to enforce rights to
indemnification, the LLC shall indemnify any such indemnitee in connection with
a proceeding (or part thereof) initiated by such indemnitee only if such
proceeding (or part thereof)

 

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was authorized or ratified by the Board of Managers.  The right to
indemnification conferred in this Section 4.16(a) shall be a contract right and
shall include the right to be paid by the LLC the expenses incurred in defending
any proceeding in advance of its final disposition (hereinafter an “advancement
of expenses”).  Any advancement of expenses shall be made only upon delivery to
the LLC of a written undertaking (hereinafter an “undertaking”), by or on behalf
of such indemnitee, to repay all amounts so advanced if it shall ultimately be
determined by final judicial decision from which there is no further right to
appeal that such indemnitee is not entitled to be indemnified for such expenses
under this Section 4.16(a) and upon delivery to the LLC a written affirmation
(hereinafter an “affirmation”) by the indemnitee of its good faith belief that
such indemnitee has met the standard of conduct necessary for indemnification by
the LLC pursuant to this subsection.

 

(b)        If a written claim for indemnification under Section 4.16(a) is not
paid in full by the LLC within sixty (60) days after the receipt thereof, except
in the case of a claim for an advancement of expenses, in which case the
applicable period shall be twenty (20) days, the indemnitee may at any time
thereafter bring suit against the LLC to recover the unpaid amount of the
claim.  If successful, in whole or in part, in any such suit or in a suit
brought by the LLC to recover an advancement of expenses pursuant to the terms
of an undertaking, the indemnitee shall be entitled to be paid also the expenses
of prosecuting or defending such suit.  The indemnitee shall be presumed to be
entitled to indemnification under this Section 4.16(b) upon submission of a
written claim (and, in an action brought to enforce a claim for an advancement
of expenses, where the required undertaking and affirmation have been tendered
to the LLC) and thereafter the LLC shall have the burden of proof to overcome
the presumption that the indemnitee is so entitled.  Neither the failure of the
LLC (including the Board of Managers or independent legal counsel) to have made
a determination prior to the commencement of such suit that indemnification of
the indemnitee is proper in the circumstances nor an actual determination by the
LLC (including the Board of Managers or independent legal counsel) that the
indemnitee is not entitled to indemnification shall be a defense to the suit or
create a presumption that the indemnitee is not so entitled.

 

(c)        The right to indemnification and the advancement of expenses
conferred in this Section 4.16 shall not be exclusive of any other right which
any Member, or an Affiliate thereof, may have or hereafter acquire under any
statute, provision of this Agreement, general or specific action of the Board of
Managers, contract or otherwise.

 

(d)        The LLC may maintain insurance, at its expense, to protect itself
against any expense, liability or loss asserted against or incurred arising from
the Member’s status as a Member, whether or not the LLC would have the power to
indemnify such Member against such expense, liability or loss under the Act. 
The LLC may enter into contracts with any Member in furtherance of the
provisions of this Section and may create a trust fund, grant a security
interest or use other means (including, without limitation, a letter of credit)
to ensure the payment of such amounts as may be necessary to effect
indemnification as provided in this Section.

 

4.17        Admission of Additional Members.  Except as provided in Section 10,
admission of a person as a Member requires approval by all the Members. 
Notwithstanding the foregoing, a person shall not become an additional Member
unless and until such person becomes

 

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a party to this Agreement by signing this Agreement and executing such documents
and instruments as the Board of Managers may reasonably request as additional,
necessary or appropriate to confirm such person as a Member in the LLC.

 

4.18        Subsidiary Entities and Joint Ventures.  Decisions as to the
formation of a subsidiary entity or joint venture, the transfer of interest in a
subsidiary entity or joint venture, the dissolution and distribution of property
of a subsidiary entity or joint venture and other matters relating to the
operations of a subsidiary entity or joint venture that would have been Major
Decisions for the Members or decisions for Managers had the matter been for the
LLC constitute Major Decisions for the Members.  The Members shall insure that
no provisions are included in the organizational documents establishing any
subsidiary entity or joint venture or other procedures or practice of the entity
that would in any way impair the ability to the LLC to exercise at least its pro
rata interest concerning decisions either as a shareholder or a member or though
the appointment of officers or managers of the subsidiary entity or joint
venture on all matters on the same basis that would have been decided by the
Members or the Managers under this Agreement had the LLC engaged in such
business itself.  With respect to each matter presented to the board of
directors, board of managers or other similar governing body of a joint venture
or a subsidiary that is not wholly-owed by the LLC, the directors, managers or
other individuals holding similar responsibilities who are nominated or elected
by the LLC shall vote on each such matter as a block consistent with the
position agreed to by the chief executive officers of both of the Members, or,
in the absence of agreement, shall abstain from voting on the matter (and, to
the extent possible, shall take such action as necessary to ensure that the
board or similar body does not obtain a quorum for voting on such matter); 
provided, that no director, manager or other individual with similar
responsibilities shall be required to vote in a manner which such individual
believes would constitute a violation of a fiduciary duty owed by such
individual.  The Members shall also insure that any such entity shall provide to
the LLC all the information that would have been furnished by the LLC had the
LLC engaged in such business itself.

 

Section 5 – BOARD OF MANAGERS

 

5.1        Creation of Board of Managers.  As provided in Section 2.2, the
business and affairs of the LLC shall be managed by its Board of Managers.

 

5.2        Composition of Committee; Qualification.  Each Member shall at all
times designate three (3) individuals to serve on the Board of Managers until
amended by Members in accordance with this Agreement.  A Manager must be an
employee, officer or director of one of the Members or its Affiliates.  At each
meeting of the Board of Managers, each Manager may, in its sole discretion,
designate additional nonvoting representatives who may attend all such meetings
of the Board of Managers with the Manager.  The nonvoting representatives may
participate in any meeting of the Board of Managers, but may not vote on any
matters considered by the Board of Managers.  Although each Member shall be
represented by three (3) Managers, said three Managers shall have only one vote,
exercisable by any of such three Managers.

 

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5.3           Scope of Authority.  The Board of Managers shall have
responsibility for overseeing the operations, affairs and business of the LLC,
and making certain delegated Major Decisions.  With respect to any Major
Decision that has been delegated to the Board of Managers by the Members, any
action taken or decision made by the Board of Managers prior to the receipt by
the Board of Managers of written notice of the Members withdrawing such
delegation shall be final and binding on all Members and the LLC.  The President
of the LLC shall be the senior Member of the Management Personnel and chief
executive officer of the LLC.  So long as SSA or an Affiliate of SSA is a
Member, the President of the LLC shall be the President of SSA.  The President
of the LLC, with the advice of the Board of Managers of the LLC, shall prepare a
description of the categories of other officers and senior management employees
of the LLC and shall file the same with the Board of Managers.  The President of
the LLC shall identify individuals to fill the respective categories.  The
Management Personnel of the LLC shall be responsible for actual day-to-day
operations of the container stevedoring and terminal services provided by the
LLC and all decisions relating thereto and shall have the authority to
contractually bind the LLC with respect to activities of the LLC undertaken in
the ordinary course of business.  The President shall establish the compensation
for all employees of the LLC (other than officers compensated pursuant to the
Administrative Services Agreement).  By October 1 of each year, the Management
Personnel, with the advice of the Board of Managers, shall prepare and deliver
to the Members its best estimate for an operating budget (including capital
expenditures) for the LLC for the following Fiscal Year and shall prepare and
deliver to the Members a final budget (including capital expenditures) for such
Fiscal Year by December 1 of each year.  The operating budget will be on an
annual basis, but the Management Personnel will provide calendar monthly and
quarterly volume measures to the Members for the overall results of the LLC. 
All operating budget data shall include location-specific volume and amounts. 
The Board of Managers shall advise Members when it makes Major Decisions
delegated to it by the Members.  The Board of Managers shall refer to the
Members other matters which are not Major Decisions, and which the Board of
Managers determines are desirable or appropriate for the Members to decide.  In
such cases, the Board of Managers may elect to deliver to the Members its
recommendation regarding the specific matter.

 

5.4           Election; Term of Office.  The Members shall appoint their initial
respective participants on the Board of Managers at the first annual meeting of
the Members.  At each annual meeting thereafter, the Members shall each
designate its respective participants on the Board of Managers.  Subject to
Section 5.6, each Manager shall hold office until the next succeeding annual
meeting, and in each case until his or her successor shall have been elected and
qualified.  The Managers representing any Member may give a written proxy to a
representative who may act on behalf of such Manager at any meeting of the Board
of Managers.

 

5.5           Vacancies.  Any vacancy occurring on the Board of Managers
(whether caused by resignation, death or otherwise) shall be filled by the
Member whose designee’s departure from the Board of Managers has caused the
vacancy.  A Manager chosen to fill any vacancy shall hold office until the next
annual meeting of Members, or until his or her other successor shall have been
elected and qualified.

 

5.6           Removal.  A Member may remove any of its participants on the Board
of Managers without cause, and may do so by providing oral or written notice to
the participant with a written notice advising the other Members and Managers of
such removal and the effective date thereof.

 

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5.7           Resignation.  A Manager may resign at any time by delivering
written notice to the Member who appointed such participant with a copy to the
other Members and to the Managers.  A resignation is effective when the notice
is delivered unless the notice specifies a later effective date.

 

5.8           Action by Board of Managers.  Unless otherwise agreed to by the
Board of Managers, meetings of the Board of Managers will be held at such place,
day, and time as shall from time to time be fixed by resolution of the Board
without notice other than the delivery of such resolution as provided in
Section 5.9 below, or at such place, day, and time and for such purpose or
purposes, as may be requested by the Managers representing any Member; provided,
that notice of such meeting has been given to each Manager in accordance with
Section 5.9 herein.

 

5.9           Notice of Meeting.  Notice of the place, day, and time of any
meeting of the Board of Managers for which notice is required shall be given, at
least two (2) days preceding the day on which the meeting is to be held by the
person calling the meeting, in any manner permitted by law, including orally. 
Any oral notice given by personal communication over the telephone or otherwise
may be communicated either to the Manager or to a person at the office of the
Manager who, the person giving the notice has reason to believe, will promptly
communicate it to the Manager.

 

Written notice of meeting is required if the business to be conducted at any
meeting of the Board of Managers includes any Major Decision.  The written
notice shall state that the purpose or one of the purposes of the meeting is to
consider the Major Decision and shall describe the Major Decision with
reasonable clarity.

 

No notice of any regular meeting need be given if the place, day, and time
thereof have been fixed by resolution of the Board of Managers and a copy of
such resolution has been delivered to every Manager at least two (2) days, or
deposited in the United States mail, as evidenced by the postmark, with
first-class postage prepaid, and correctly addressed at least five (5) days,
preceding the day of the first meeting held in pursuance thereof.

 

Notice of a meeting of the Board of Managers need not be given to any Manager if
it is waived by the Manager in writing, whether before or after such meeting is
held.  A Manager’s attendance at or participation in a meeting shall constitute
a waiver of notice of such meeting except when a Manager attends or participates
in a meeting for the express purpose of objecting on legal grounds prior to or
at the beginning of the meeting (or promptly upon the Manager’s arrival) to the
holding of the meeting or the transaction of any business and does not
thereafter vote for or assent to action taken at the meeting.  Any meeting of
the Board of Managers shall be a legal meeting without any notice thereof having
been given if all of the Managers are present without objecting, or waive notice
thereof, or any combination thereof.

 

5.10         Quorum.  The presence of at least one of the Managers representing
each of the Members shall constitute a quorum for the transaction of business.

 

5.11         Voting Requirements.  The making of any decision, including a Major
Decision delegated to the Board of Managers by the Members, shall require the
approval of at least one of the Managers representing each of the Members who
are members of the Board of Managers.  The Board of Managers shall promptly
advise the Members of any Major Decision it has made.

 

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5.12         Action Without a Meeting.  Any action required by law to be taken
or which may be taken at a meeting of the Board of Managers may be taken without
a meeting if one or more consents in writing, setting forth the action so taken,
shall be signed either before or after the action so taken by the number of
Managers whose approval would be necessary if such decision were made at a
meeting of the Board of Managers and delivered to the LLC for inclusion in the
minutes or filing with the LLC records; provided, that any such consent shall
have been delivered to all of the Managers at last ten (10) days before such
action is to be so taken or authorized.  Such consent shall have the same effect
as a meeting vote.  Action taken under this Section 5.12 is effective when the
last person signs the consent, unless the consent specifies a later effective
date.  A copy of all such consents shall be promptly delivered to each Manager.

 

5.13         Telephonic Meetings. Managers may participate in a meeting of the
Board of Managers by means of a telephone conference call, on-line facilities or
similar communication equipment.  Participation by such means shall constitute
presence in person at a meeting.

 

5.14         Restrictions on Authority of Board of Managers.  The Board of
Managers shall not have the authority to do any of the following acts without
the unanimous consent of the Members:

 

(a)           Knowingly do any act in contravention of this Agreement;

 

(b)           Knowingly make any Major Decision not delegated to them by the
Members; or

 

(c)           Knowingly perform any act that would subject any Member, Manager,
Affiliate of any of the same, or any employee of any of the same, to personal
liability in any jurisdiction.

 

5.15         Duties and Obligations of Board of Managers.  In addition to such
other duties and obligations as the Board of Managers may have, the Board of
Managers shall take all actions which may be necessary or appropriate for the
continuation of the LLC’s valid existence as a limited liability company under
the laws of the State of Delaware and of each other jurisdiction in which such
existence is necessary to protect the limited liability of the Members or to
enable the LLC to conduct the business in which it is engaged.

 

5.16         Right to Rely on Board of Managers.  Any person dealing with the
LLC may rely upon a certificate signed by the Managers representing each Member
as to:

 

(a)           The identity of any other Manager or any Member;

 

(b)           The existence or nonexistence of any fact or facts regarding the
affairs of the LLC; or

 

(c)           The Managers and/or Members who are authorized to execute and
deliver any instrument or document on behalf of the LLC.

 

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5.17         Indemnification of Managers.

 

(a)           Each individual (hereinafter an “indemnitee”) who was or is made a
party or is threatened to be made a party to or is otherwise involved
(including, without limitation, as a witness) in any actual or threatened claim,
action, suit or proceeding, whether civil, criminal, administrative or
investigative and whether formal or informal (hereinafter a “proceeding”), by
reason of the fact that he or she is or was a Manager of the LLC or that, while
serving as a Manager of the LLC, he or she is or was also serving at the request
of the LLC as a director, manager, officer, partner, trustee, employee or agent
of another foreign or domestic limited liability company or corporation or of a
foreign or domestic partnership, joint venture, trust, employee benefit plan or
other enterprise, whether the basis of the proceeding is alleged action in an
official capacity as such a director, Manager, officer, employee, partner,
trustee, or agent or in any other capacity while serving as such director,
Manager, officer, employee, partner, trustee, or agent, shall be indemnified and
held harmless by the LLC to the full extent permitted by applicable law as then
in effect, against all expense, liability and loss (including, without
limitation, attorneys’ fees, judgments, fines, ERISA excise taxes or penalties
and amounts to be paid in settlement) incurred or suffered by such indemnitee in
connection therewith, and such indemnification shall continue as to an
indemnitee who has ceased to be a director, manager, officer, employee, partner,
trustee, or agent and shall inure to the benefit of the indemnitee’s heirs,
executors and administrators; provided, however, that no indemnification shall
be provided to any such indemnitee if the LLC is prohibited by the Act or other
applicable law as then in effect from paying such indemnification; and provided,
further, that except as provided in this Section 5.17(a) with respect to
proceedings seeking to enforce rights to indemnification, the LLC shall
indemnify any such indemnitee in connection with a proceeding (or part thereof)
initiated by such indemnitee only if such proceeding (or part thereof) was
authorized or ratified by the Board of Managers.  The right to indemnification
conferred in this Section 5.17(a) shall be a contract right and shall include
the right to be paid by the LLC the expenses incurred in defending any
proceeding in advance of its final disposition (hereinafter an “advancement of
expenses”).  Any advancement of expenses shall be made only upon delivery to the
LLC of a written undertaking (hereinafter an “undertaking”), by or on behalf of
such indemnitee, to repay all amounts so advanced if it shall ultimately be
determined by final judicial decision from which there is no further right to
appeal that such indemnitee is not entitled to be indemnified for such expenses
under this Section 5.17(a) and upon delivery to the LLC of a written affirmation
(hereinafter an “affirmation”) by the indemnitee of his or her good faith belief
that such indemnitee has met the standard of conduct necessary for
indemnification by the LLC pursuant to this Section 5.17.

 

(b)           If a written claim for indemnification under Section 5.17(a) is
not paid in full by the LLC within sixty (60) days after the LLC’s receipt
thereof, except in the case of a claim for an advancement of expenses, in which
case the applicable period shall be twenty (20) days, the indemnitee may at any
time thereafter bring suit against the LLC to recover the unpaid amount of the
claim.  If successful, in whole or in part, in any such suit or in a suit
brought by the LLC to recover an advancement of expenses pursuant to the terms
of an undertaking, the indemnitee shall be entitled to be paid also the expenses
of prosecuting or defending such suit.  The indemnitee shall be presumed to be
entitled to indemnification under this Section 5.17 upon submission of a written
claim (and, in an action brought to enforce a claim for an advancement of
expenses, where the required undertaking and affirmation have been tendered to
the LLC) and thereafter the LLC shall

 

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have the burden of proof to overcome the presumption that the indemnitee is so
entitled.  Neither the failure of the LLC (including the Board of Managers,
independent legal counsel or the Members) to have made a determination prior to
the commencement of such suit that indemnification of the indemnitee is proper
in the circumstances nor an actual determination by the LLC (including the Board
of Managers, independent legal counsel or the Members) that the indemnitee is
not entitled to indemnification shall be a defense to the suit or create a
presumption that the indemnitee is not so entitled.

 

(c)           The right to indemnification and the advancement of expenses
conferred in this Section shall not be exclusive of any other right which any
person may have or hereafter acquire under any statute, provision of this
Agreement, general or specific action of the Members or the Board of Managers,
contract or otherwise.

 

(d)           The LLC may maintain insurance, at its expense, to protect itself
and any individual who is or was a Manager of the LLC or who, while a Manager of
the LLC, is or was serving at the request of the LLC as an agent of another
foreign or domestic limited liability company or corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise against any expense,
liability or loss asserted against or incurred by the individual in that
capacity or arising from the individual’s status as a director, manager,
officer, employee or agent, whether or not the LLC would have the power to
indemnify such person against such expense, liability or loss under the Act. 
The LLC may enter into contracts with any Manager in furtherance of the
provisions of this Section 5.17 and may create a trust fund, grant a security
interest or use other means (including, without limitation, a letter of credit)
to ensure the payment of such amounts as may be necessary to effect
indemnification as provided in this Section 5.17.

 

(e)           Any individual who is or was a Manager who, while a Manager, is or
was serving (a) as a director or officer of a foreign or domestic corporation of
which a majority of the shares entitled to vote in the election of its directors
is held by the LLC, (b) as a trustee of an employee benefit plan and the duties
of the Manager also impose duties on, or otherwise involve services by, the
Manager to the plan or to participants in or beneficiaries of the plan, or
(c) in an executive or management capacity in a foreign or domestic limited
liability company, partnership, joint venture, trust or other enterprise of
which the LLC or a wholly-owned subsidiary of the LLC is a general partner or
has a majority ownership or interest, shall be deemed to be so serving at the
request of the LLC and entitled to indemnification and advancement of expenses
under this Section 5.17.

 

(f)            A Manager acting under this Agreement shall not be liable to the
LLC, to any other Manager or to the Members, for the Manager’s good faith
reliance on the provisions of this Agreement.

 

Section 6 - CONTRIBUTIONS TO THE LLC

 

6.1           Capital Contributions of the Members.  SSA Ventures and MVI have
contributed to the capital of the LLC cash or other property in the amount or as
described in Section 6.6.

 

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6.2           Return of Capital Contributions.  A Member will have no right to
withdraw any part of its Capital Contributions or Capital Account, or to receive
any distribution from the LLC, except in accordance with the provisions of this
Agreement.  No interest shall be paid on any Capital Contributions.  A Member
will, however, be entitled to receive interest on any loans it makes to the LLC,
as provided herein.

 

6.3           Additional Contributions.  No Member may make additional
contributions to the LLC in the form of cash, property, or guarantee of LLC
indebtedness or performance by the LLC of an LLC obligation (the “Guarantee”),
unless such decision is approved by the Members in the manner required for Major
Decisions, which approval shall specify the terms upon, and proportions in
which, such additional capital may be contributed or guarantee made.

 

6.4           Loans by Members.

 

(a)           Optional Loans.  A loan to the LLC by a Member, or any Affiliate
thereof,  constitutes a Major Decision pursuant to Section 1.12(n).

 

(b)           Treatment of Loans.  No loan by a Member, or an Affiliate thereof,
will result in an increase in the Percentage Interest of the Member.  The amount
of any such loan shall not constitute a Capital Contribution and will not be
credited to the lending Member’s Capital Account.  Any loan will be an
obligation of the LLC to the lending Member, or Affiliate thereof, with
interest, and will be repaid to the lending Member, or Affiliate thereof, before
any amount may be distributed to any Member pursuant to Section 8.  Interest on
such loans will be payable without regard to the profits or losses of the LLC
and will be treated as a transaction with a Member, or Affiliate thereof, other
than in its capacity as a Member of the LLC, or Affiliate thereof, pursuant to
Section 707(a) of the Code.  All such loans will be repayable solely from the
LLC’s assets and represented by promissory notes executed by the LLC, which
shall bear interest at the prime rate of interest published in The Wall Street
Journal on the date immediately prior to the date the loan was made, applicable
at the beginning of such term, subject to adjustment to the rate in effect on
each anniversary thereof.

 

6.5           Capital Accounts.

 

(a)           Maintenance of Capital Accounts.  A separate Capital Account will
be maintained for each Member in accordance with Regulations
Section 1.704-1(b)(2)(iv); provided, however, the LLC shall not revalue any LLC
asset under Regulations Section 1.704-1(b)(2)(iv)(f) without the unanimous
approval of the Members.

 

(b)           Transfers.  In the event of a permitted transfer of a Member’s
Percentage Interest in accordance with Section 10, the Capital Account of the
transferor shall become the Capital Account of the transferee to the extent it
relates to the transferred Percentage Interest in accordance with Regulations
Section 1.704-1(b)(2)(iv).

 

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6.6           Initial Capital Accounts.  The initial Capital Accounts of the
Members upon making of their respective initial capital contributions were as
follows:

 

MVI

$16,437,972.00

 

 

 

 

SSA Ventures

$16,770,052.00.

 

 

Section 7 - ALLOCATION OF INCOME, GAINS AND LOSSES

 

7.1           Tax Allocation of Net Profit.  Except as otherwise provided in
this Agreement, Net Profit for a Fiscal Year or other fiscal period shall be
allocated as follows:

 

(a)           First, Net Profit shall be allocated to SSA Ventures in an amount
equal to the cumulative priority distribution amounts specified in
Section 8.1(a) (whether or not distributed) for the current year and all prior
Fiscal Years in excess of the sum of the cumulative Net Profit previously
allocated to SSA Ventures pursuant to this Section 7.1(a).

 

(b)           Second, remaining Net Profit, if any shall be allocated to the
Members in accordance with their Percentage Interests.

 

7.2           Tax Allocation of Net Loss.  Except as otherwise provided in this
Agreement, Net Loss for a Fiscal Year or other fiscal period shall be allocated
to the Members in accordance with their Percentage Interests.

 

7.3           Tax Allocation of Net Profit or Net Loss on Liquidation. 
Notwithstanding any provision of this Section 7 to the contrary (except
Section 7.5), all items of Net Profit and Net Loss arising from any sale,
exchange, or other disposition (including, in-kind distributions to the Members)
of any assets of the LLC with respect to the dissolution and termination of the
LLC shall be allocated among the Members as necessary to cause each Member’s
Capital Account to equal the sum of the following:

 

(a)           The amount of Net Cash Flow such Member would receive under
Section 8.1 (if that were the operative provision), plus

 

(b)           The fair market value of any asset to be distributed in-kind to
such Member under Section 11.3.

 

For purposes of this Section 7.3, a Member’s Capital Account shall be determined
by crediting to such Capital Account such Member’s share of minimum gain
pursuant to Regulation Section 1.704-2.

 

7.4           Special Allocations.  Allocations of Net Profit and Net Loss, and
specific items of income, gain, loss or deduction, shall be subject to the
alternate test for economic effect set forth in Regulation
Section 1.704-1(b)(2)(ii)(d) and the minimum gain chargeback rules set forth in
Regulation Section 1.704-2.  The terms of Regulation
Section 1.704-1(b)(2)(ii)(d) (including,

 

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without limitation, a “qualified income offset” provision and a provision
prohibiting allocations to a member that would cause or increase a deficit
balance in such Member’s Capital Account) and Regulation Section 1.704-2
(including, without limitation, a provision allocating “nonrecourse deductions”
to the Members in accordance with their Percentage Interests, a provision
allocating “Member nonrecourse deductions” to the Member who bears the economic
risk of loss with respect to the related “Member nonrecourse debt” and a
“minimum gain chargeback” provision) are incorporated in this Agreement.  If
losses or deductions are reallocated among the Members under the alternate
economic effect test, subsequent allocations of income and gain shall be made as
necessary to offset such reallocation of losses or deductions.  A Member’s
Percentage Interest shall be its interest in profits for purposes of determining
the Member’s share of “excess nonrecourse liabilities” under Regulation
Section 1.752-3(a)(3).

 

7.5           Intent of Allocations.  The allocation provisions of this
Agreement are intended to produce final Capital Account balances of the Members
such that over the life of the LLC, distributions of Net Cash Flow are
distributed to the Members in a manner consistent with Section 8.1 (taking into
account the varying Percentage Interests of the Members for each Fiscal Year
over the life of the LLC) and in-kind liquidating distributions of assets under
Section 11.3 are made in accordance with Section 11.3.  To the extent that the
allocation provisions of this Agreement would not produce such final Capital
Account balances consistent with the previous sentence, (i) the Members shall
amend such provisions if and to the extent necessary to produce such result, and
(ii) income or loss of the LLC for prior open years (or items of gross income
and deduction of the LLC) shall be reallocated among the Members to the extent
it is not possible to achieve such result with allocations of income (including
gross income) and deduction for the current year and future years.

 

7.6           Tax Allocations:  Code Section 704(c).  In accordance with Code
Section 704(c) and the Regulations thereunder, income, gain, loss, and deduction
with respect to any property contributed to the capital of the LLC shall, solely
for tax purposes, be allocated among the Members so as to take account of any
variation between the adjusted basis of such property to the LLC for Federal
income tax purposes and its initial fair market value.  Such allocations shall
be made using a method agreed to by the Members which is in accordance with
Regulation Section 1.704-3.

 

7.7           Allocations in Event of Sale of LLC Interest.  If an interest in
the LLC is transferred or sold in accordance with Section 10 of this Agreement,
the Net Profit and Net Loss of the LLC shall be calculated as of the end of the
month immediately prior to the month in which the sale occurs.  The transferor
Member shall be allocated an amount equal to the Net Profit and Net Loss of the
LLC allocable to the period ending on the last day of the month immediately
prior to the transfer.  The transferee of the interest in the LLC to be sold
shall be allocated an amount equal to the Net Profit and Net Loss of the LLC
allocable to the remainder of the calendar year.  This paragraph shall apply for
purposes of computing a Member’s Capital Account and for federal income tax
purposes.

 

7.8           Deficit Capital Account Balances.  Except as provided in
Section 8.1(d), the Members shall not be obligated at any time to repay or
restore to the LLC all or any part of any distributions made to the Members by
the LLC.  No Member shall be required to restore a deficit Capital Account
balance to the LLC.

 

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Section 8 - DISTRIBUTIONS

 

8.1           Distributions. The decision whether to distribute Net Cash Flow is
a Major Decision requiring the approval of all Members.  The Members have
decided that distributions of Net Cash Flow will be made to the Members for each
Fiscal Year as follows:

 

(a)           First, to SSA Ventures in the following amounts:

 

1999

$2,300,000

2000

$5,600,000

2001

$6,400,000

2002 and thereafter:

$0.

 

The distributions set forth in this Section 8.1(a) will be cumulative to the
extent not distributed to SSA Ventures in any given Fiscal Year, but no interest
will accrue on any amount not distributed.  Unless otherwise decided by the
Board of Managers, distributions shall not be made under this Section 8.1(a) to
the extent that (i) outstanding revolving credit borrowings exceed the balance
of accounts receivable, or (ii) Net Working Capital is less than $1.00.  No
distributions shall be made under Section 8.1(b) unless and until all
distributions set forth in Section 8.1(a) for the then current and all prior
Fiscal Years are distributed in full to SSA Ventures.

 

(b)           Second, the balance to the Members in accordance with their
Percentage Interests.

 

(c)         Distributions of Net Cash Flow as provided in this Section 8.1 will
be made unless such distributions will have a material adverse effect on the
operations or financial position of the LLC.

 

(d)           The distributions referred to in Section 8.1(a) and (b) shall be
made as follows:  Within thirty (30) days after the end of each second calendar
quarter of each Fiscal Year, to the extent there is Net Cash Flow for said
semiannual period, and in accordance with the distribution priorities set forth
in said Section 8.1(a) and (b), and the limitations thereon set forth in the
second paragraph of Section 8.1(a) and in Section 8.1(c), the LLC shall
distribute, as draws against Net Cash Flow for the entire Fiscal Year during
which such semiannual period occurs (i) one-half of the amount for such Fiscal
Year set forth in Section 8.1(a), and (ii) the remainder of said Net Cash Flow
for such semiannual period as set forth in Section 8.1(b).  Within one hundred
twenty (120) days after the end of each Fiscal Year, the actual Net Cash Flow
for such Fiscal Year shall be calculated, and final Fiscal Year distributions
(or other adjustments or recoupments, as applicable) shall be made pursuant to
Section 8.1(a), (b) and (c) based upon such calculations, which distribution or
adjustments shall take into account the total amounts to be distributed pursuant
to Section 8.1(a) for said Fiscal Year and any over or underpayments of draws
for that year in light of actual Fiscal Year-end results.  Distributions for
Fiscal Year ending January, 2000 shall be made within one hundred twenty (120)
days of the end of said Fiscal Year pursuant to Section 8.1(a), (b) and (c).

 

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8.2           Tax Payment Distributions.  On or before the fifth day after the
LLC files IRS Form 1065 with the Internal Revenue Service for a Fiscal Year, the
LLC shall distribute to the Members an amount equal to the excess of (a) the
LLC’s net taxable income and gain allocable to the Members for such Fiscal Year
multiplied by thirty-five percent (35%) over (b) the amount of cash otherwise
distributed in the Fiscal Year.  Distributions pursuant to this Section 8.2
shall be made to each Member pro rata in the proportions by which the LLC’s net
taxable income for such Fiscal Year has been allocated to the Members under
Section 7.  Such distributions shall be credited against any distributions to
Members under Section 8.1, as applicable, and shall not be in addition to
distributions under such Section.  Notwithstanding the foregoing provisions of
this Section 8.2, no such tax distribution shall be made to the extent that Net
Cash Flow is not to be distributed pursuant to Section 8.1(a) or (c).

 

8.3           Amounts Withheld From Distributions.  All amounts withheld
pursuant to the Code or any provisions of any state, local or foreign tax law
with respect to any distribution to the Members shall be treated as amounts
distributed to the Members pursuant to Section 8 for all purposes under this
Agreement.

 

8.4           Distributions Upon Liquidation.  Notwithstanding anything to the
contrary in this Section 8, upon the dissolution of the LLC for any reason, the
debts and obligations of the LLC including any debts to Members shall be paid
and the remaining assets of the Company shall be distributed to the Members
(after giving effect to all contributions, distributions, allocations and other
Capital Account adjustments for all taxable years, including the year during
which such liquidation or dissolution occurs) pursuant to the provisions of
Sections 11.2 and 11.3.

 

8.5           Distributions In-Kind.  Except as provided in Sections 11.2 and
11.3, no Member shall have the right to demand and receive property other than
cash as a distribution from the LLC.  Except as provided in Sections 8.1, 8.2
and 8.3, no Member shall have the right to demand and receive cash from the LLC.

 

Section 9 - ACCOUNTING; BOOKS AND RECORDS

 

9.1           Accounting.  The LLC will keep its accounting records in
accordance with generally accepted accounting principles, consistently applied,
and will report for federal income tax purposes on the accrual basis, as
determined by the Board of Managers.

 

9.2           Books and Records.  During the term of the LLC, the Board of
Managers will keep, or cause to be kept, records and books of account in which
each transaction of the LLC will be entered fully and accurately.  Such books
and records will include a true and correct copy of the Certificate of
Formation, this Agreement and amendments thereto, a current and past list of
names and addresses of the Members, copies of all federal, state and local tax
returns and reports and financial statements of the LLC for at least the three
(3) most recent Fiscal Years (or if longer, the Board of Managers will keep all
Tax Returns and reports for any Fiscal Year which the statute of limitations for
assessment of taxes against a Member is still open), and any other records the
Board of Managers deems appropriate or are required pursuant to the Act or by
the Members.  All books and records of the LLC will be available for reasonable
inspection and examination by the Members or their duly authorized
representatives during ordinary business hours.

 

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9.3           Periodic Financial Statements.  The Board of Managers shall have
prepared (i) as of the end of each fiscal month of each Fiscal Year, a report
which will include (A) a balance sheet of the LLC, (B) a statement of the LLC’s
income and expense, (C) a statement of changes in Members’ equity, (D) a
statement of capital account balances, and (E) a statement of changes in cash
flows for that period; (ii) as of the end of each fiscal quarter of each Fiscal
Year, a report of all such items set forth in clause (i) for such quarter; and
(iii) as of the end of each Fiscal Year, a report of all such items set forth in
clause (i) for the Fiscal Year.  Each item contained in such statements and
reports will be prepared in accordance with generally accepted accounting
principles consistently applied by the LLC, and at the expense of the LLC.  The
Board of Managers will distribute copies of the statements and reports to each
Member, within thirty (30) days after the end of each monthly period with
respect to the monthly statement; (provided, however, the Board of Managers
shall also provide the Members with its best estimate of December results by the
following January 15) within thirty (30) days after the end of each quarterly
period with respect to the quarterly reports and statements, and within ninety
(90) days after the close of each Fiscal Year of the LLC with respect to the
annual reports and statements.

 

9.4           Tax Returns: Income Tax Information.  Subject to Section 7 hereof,
the Board of Managers will cause to be prepared and timely filed with the
appropriate authorities, all federal, state, and local income and other tax
returns (a “Tax Return”) of the LLC.  The LLC shall not file or amend any Tax
Return without the prior written approval of all Members.  At least fifteen (15)
days prior to the due date for any such Tax Return, the LLC shall furnish all
Members with a copy of the Tax Return proposed to be filed for review and
comment by all Members.  The LLC shall not make or change any tax election or
extension without the prior written approval of all Members.  At least thirty
(30) days prior to the due date for making any such election or extension, the
LLC shall provide all Members written notice and explanation of the proposed
election or extension.  The LLC shall furnish to Matson, by no later than
December 15 of the relevant Fiscal Year, an estimate of any permanent and timing
differences between tax and book income as necessary for Matson to prepare a
year-end tax provision in accordance with generally accepted accounting
principles.  The LLC shall also furnish to each of the Members by May 1 of each
Fiscal Year all state apportionment information necessary for each Member to
prepare its state Tax Returns.  Subject to direction of the Board of Managers
and so long as the Administrative Services Agreement remains in effect, SSA
shall, pursuant to the Administrative Services Agreement, be responsible to
prepare and file Tax Returns, and to perform the other obligations on behalf of
the LLC, under this Section 9.4.  Within ninety (90) days after the close of
each Fiscal Year, each Member shall be furnished a statement suitable for use in
preparing the Member’s income tax return, showing the amounts of any
distributions, contributions, gains, losses, profits, or audits allowed to the
Member during such Fiscal Year.

 

9.5           Duties of Tax Matters Member.

 

(a)           SSA Ventures shall be the “Tax Matters Partner” of the LLC, as
that term is defined in Section 6231(a)(7) of the Code.  As such, the Tax
Matters Partner will keep all Members informed of all administrative and
judicial proceedings for the adjustment of

 

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LLC tax items, as required by Section 6223(g) of the Code and the Regulations
thereunder.  The Tax Matters Partner will represent the LLC in all such
proceedings; provided, however, that other Members may participate in such
proceedings to the extent permitted by Sections 6221 through 6231 of the Code,
and the corresponding Regulations.  The LLC will pay all ordinary and necessary
expenses incurred in connection with any such proceedings.  Notwithstanding
anything in the foregoing to the contrary, the Tax Matters Partner shall not
take any of the following actions without the approval of all Members: 
(1) enter into a settlement agreement with the Internal Revenue Service or any
other taxing authority; (2) file a petition as contemplated in Code
Section 6226(a) or 6228; (3) intervene in any action as contemplated in Code
Section 6226(b)(5); (4) file any request contemplated in Code Section 6227(b);
or (5) enter into an agreement extending the period of limitations contemplated
in Code Section 6229(b)(1)(B).

 

(b)           No Member shall, on such Member’s federal, state, or foreign
income tax return, treat any “partnership item” (as defined in
Section 6321(a)(3) of the Code and the Regulations thereunder) in a manner which
is inconsistent with the treatment of such “partnership item” on the LLC’s tax
return.

 

(c)           The chief financial officers of SSA and Matson shall review with
each other no later than June 1 of each year the annual audited financial
statements of SSA and Matson, but neither chief financial officer shall retain a
copy of the audited financial statements of the other’s company.

 

Section 10 - TRANSFERS OF LLC INTERESTS

 

10.1         Prohibition on Transfer.  Except as otherwise provided in this
Section 10, and except for the assignments permitted pursuant to the last
sentence of Section 12.3, a Member may not in any way transfer, grant a security
interest in, pledge or encumber, voluntarily or involuntarily, its Percentage
Interest, any portion thereof or interest therein, without the prior written
consent of the other Member, which consents may be withheld with or without
cause.  Any purported transfer not expressly permitted by and in compliance with
the provisions of this Section 10 will be void and of no force or effect.

 

(a)           Transfer Defined.  As used in this Agreement, the term “Transfer”
shall include any sale, assignment, gift, pledge, or other disposition or
encumbrance of all or a portion of a Member’s interest in the LLC, or of an
ownership interest in the shares of SSA Ventures or MVI (as long as they hold
such interests in the LLC), in each case whether voluntary or involuntary.

 

10.2         Other Transfers Subject to Refusal Rights.

 

(a)           Proposed Sales.  If a Member (the “transferor”) desires to effect
a Transfer of any portion of its Percentage Interest to any person, the
transferor shall first give written notice to the Board of Managers and to the
other Member of its intention to do so (“Notice of Sale”).  The Notice of Sale
must name the proposed transferee and specify the amount of the Percentage
Interest to be transferred, all proposed consideration and the proposed terms of
payment.  The transferor shall provide the Board of Managers, and/or the other
Member with a copy of the signed letter of intent or term sheet, or the draft
agreement (certified by the proposed transferee as a true draft),

 

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verifying the prospective transferee, price and terms that constitute a bona
fide offer.  Any offer from an Affiliate of a Member shall be on arm’s-length
terms as demonstrated by evidence reasonably requested by the non-transferring
Member.  Following delivery of the Notice of Sale and documentation and upon
receipt of the written consent of the other Member, the other Member shall
thereupon have the option, for a period of thirty (30) days from the date of
delivery of the Notice of Sale, to purchase all, but no lesser portion, of the
offered amount of the subject Percentage Interest at the price and on the other
terms and conditions stated in the Notice of Sale. To exercise such option, the
other Member shall notify the transferor of its intention, in writing, within
the applicable option period.  The notice of intention shall be accompanied by
the exercising party’s cashier’s check in the amount of five percent (5%) of the
purchase price, as non-refundable earnest money.  Closing of all sales offered
hereunder shall occur within ten (10) business days of the date such offer(s) is
accepted.  In the event the other Member does not elect to purchase the offered
Percentage Interest, the transferor shall have the right, for a period of sixty
(60) days after expiration of the option period, to transfer such Percentage
Interest to the proposed transferee at the price and on the terms specified in
the Notice of Sale.  Any Percentage Interest not so transferred by the
transferor at the end of said 60-day period shall again become subject to the
restrictions of this Agreement.

 

10.3         Conditions Precedent to Any Transfer or Encumbrance. 
Notwithstanding any contrary provision contained in this Agreement, no Member
may effect a Transfer of its Percentage Interest:

 

(a)           Without notifying the other Member, in writing, thirty (30) days
in advance of any proposed Transfer;

 

(b)           Unless and until the LLC has received an opinion of counsel for
the LLC, prepared at the transferring Member’s expense, stating that the
proposed Transfer will not cause the termination of the LLC under this Agreement
or the Act or for federal income tax purposes;

 

(c)           Unless and until the LLC has received an opinion of counsel
satisfactory to such Member, prepared at the expense of the Member proposing the
Transfer, stating that the proposed Transfer (i) may be effected without
registration of the Percentage Interest under the Securities Act of 1933, as
amended, and (ii) will not violate any applicable state securities law
(including investor suitability standards); and

 

(d)           Unless and until the transferor’s required contributions to the
capital of the LLC have been made.

 

10.4         Effect of Transfer.  If any purported Transfer of a Member’s
Percentage Interest does not comply with the various requirements and
restrictions contained in this Section 10, it will be void and of no force or
effect.  If any such purported Transfer complies with the various requirements
and restrictions contained in this Section 10, then effective on the date of the
Transfer, the transferor will cease to be a Member with respect to the
transferred Percentage Interest and, whether or not the transferee is admitted
to the LLC as a substitute Member pursuant to the provisions of this Agreement,
the transferee will be entitled to receive all future distributions to which the
transferor would otherwise be entitled.  In the case of a Transfer of an
interest, the

 

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transferee shall succeed to the Capital Account of the transferor, or, in the
case of a partial Transfer, a proportionate share thereof.  The LLC will be
entitled to treat the transferor as the record owner of the transferred
Percentage Interest until the effective date, and no Member will incur liability
for distributions made in good faith to the transferor prior to the effective
date.  No such Transfer will relieve the transferor of its existing obligations
under this Agreement.

 

10.5         Substitute Members.  A transferee of a Member’s Percentage Interest
will not be admitted to the LLC as a substitute Member unless:

 

(a)           The Transfer complies with all requirements of this Section 10;

 

(b)           The transferor gives the transferee the right to be substituted in
its place; and

 

(c)           The transferee has agreed in writing to be bound by all of the
terms and conditions of this Agreement, and has paid all expenses of the LLC
incurred in connection with the transfer.

 

Upon admission to the LLC as a substitute Member, a transferee shall succeed to
all rights and obligations of its transferor under this Agreement.

 

Section 11 - DISSOLUTION, WINDING UP, TERMINATION AND PURCHASE OPTION

 

11.1         Events Causing Dissolution.  Except as provided in Section 11.7,
and with respect to the events set forth in Subsections (a), (d), (e), (h), (i),
(j), (k), (l), (n), (o) or (p) of this Section 11.1, only if the Member that is
not responsible for the occurrence of the event or the default set forth therein
elects to dissolve the LLC (unless dissolution results as a matter of law), the
LLC will be dissolved and its affairs will be wound up upon the happening of the
first to occur of the following:

 

(a)           Any action or inaction by a Member that results in a dissolution
or other termination of the LLC under the Code;

 

(b)           The unanimous agreement of the Members;

 

(c)           The sale or other disposition of all or substantially all of the
assets of the LLC;

 

(d)           The dissolution of a Member, or SSA or Matson, or the failure by
SSA Ventures or MVI to remain wholly-owned subsidiaries of SSA or Matson,
respectively;

 

(e)           An act of Bankruptcy by, or the insolvency of a Member, or SSA or
Matson;

 

(f)            The insolvency of the LLC;

 

(g)           Upon the expiration of the effective date of administrative
dissolution;

 

(h)           The termination of the stevedoring and terminal services agreement
between Matson and the LLC;

 

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(i)            A breach of any Definitive Agreement, or any agreement entered
into pursuant to Section 4.4, which results in the termination of such
Definitive Agreement or other agreement after any applicable notice and
opportunity to cure such breach in accordance with the terms of such Definitive
Agreement or other agreement;

 

(j)            Any other event or act by a Member, or an Affiliate thereof,
causing dissolution of the LLC pursuant to the Act or this Agreement;

 

(k)           The pledge or encumbrance of, or the granting of a security
interest in, a Member’s Percentage Interest, or any interest in a Member, by a
Member or any Affiliate thereof;

 

(l)            The sale of all or substantially all of a Member’s assets or the
merger or consolidation of a Member with any other entity in which the Member
does not survive;

 

(m)          Any consistent and persistent action or inaction by any Management
Personnel of the LLC, after notice to cure and the lapse of a reasonable period
of time to effect such cure, which materially adversely affects the operations
or financial position of the LLC in a manner inconsistent with management of a
similar enterprise by a prudent Manager;

 

(n)           Any consistent and persistent action or inaction by any Member, or
Affiliate thereof, after notice to cure and the lapse of a reasonable period of
time to effect such cure, in violation of this Agreement or which materially
adversely affects the LLC;

 

(o)           Any violation by a Member of the provisions of Section 4.2,
Section 4.15 or Section 12.11; and

 

(p)           Any Vessel Disposition pursuant to Section 11.10.

 

11.2         Winding Up, Liquidation, and Distribution of Assets.

 

(a)           Upon dissolution of the LLC, the Members or a person selected by
the Members to act as a liquidating trustee (the “Liquidating Trustee”), shall
wind up the affairs of the LLC pursuant to the following provisions.  For any
Fiscal Year of the LLC in which an event occurs resulting in the dissolution or
liquidation of the LLC, and for each Fiscal Year thereafter, each item of
income, gain, loss or deduction which comprises the LLC’s Net Profit and Net
Loss for any such Fiscal Year shall be credited or charged to the Capital
Accounts of the Members (which Capital Accounts shall first be adjusted to take
into account all distributions made during the Fiscal Year) in accordance with
Section 7.3.  The Members or the Liquidating Trustee, as applicable, shall, as
soon as practicable, determine which assets, if any, will be distributed in-kind
to the Members pursuant to Section 11.3.  Thereafter, the Members or the
Liquidating Trustee, as applicable, shall sell or otherwise liquidate the assets
of the LLC, other than those that will be distributed in-kind to Members, after
which the assets of the LLC or the proceeds therefrom, shall be distributed or
used as follows and in the following order or priority:

 

(i)            First, for the payment of the debts and liabilities of the LLC;

 

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(ii)           Second, to the withholding of any reserves that the Members or
the Liquidating Trustee may deem reasonably necessary (considering, among other
things, the previous experiences of the Liquidating Trustee with respect to the
adequacy of reserves) for any unforeseen or unfixed or contingent liabilities or
obligations of the LLC;

 

(iii)          Third, to SSA Ventures in an amount equal to any amounts
remaining undistributed under Section 8.1(a) for the current and all prior
Fiscal Years; and

 

(iv)          Finally, any remaining assets will be distributed to the Members
in accordance with their positive Capital Account balances (as decreased for any
distributions under Section 11.2(a)(iii)) in accordance with Regulations
1.704-1(b)(2)(ii)(b)(2).

 

(b)           Except as provided by law or as expressly provided in this
Agreement, upon dissolution, each Member shall look solely to the assets of the
LLC for the return of its Capital Contributions.  If the LLC property remaining
after the payment or discharge of the debts and liabilities of the LLC is
insufficient to return the cash contribution of one or more Members, the Members
shall have no recourse against any other Member.

 

(c)           Upon completion of the winding up, liquidation and distribution of
the assets, the LLC shall be terminated.

 

(d)           The Members shall comply with any applicable requirements of
applicable law pertaining to the winding up of the affairs of the LLC and the
final distribution of its assets.

 

11.3         Distributions In-Kind on Liquidation.  Should the LLC unwind,
dissolve or liquidate, each Member has the right to request that the LLC’s
assets, including equipment, terminal leases and third party customer business,
to the extent feasible and segregable, be distributed in-kind in a manner that
would allow each Member, should it so elect, to continue to provide container
stevedoring and terminal services to the same customer base and segment of the
ocean shipping business served by such Member prior to the creation of the LLC,
subject in all cases to the distribution provisions of Section 11.2(a). 
Furthermore, if the Members or the Liquidating Trustee, as applicable, shall, in
their or its good faith judgment, determine a sale or other disposition of part
or all of the Company’s assets would cause undue loss to the Members, the
Members or the Liquidating Trustee may distribute part or all of such remaining
assets in-kind to the Member.  If the Members or the Liquidating Trustee elects
to distribute any assets in liquidation of the LLC pursuant to this Section 11.3
such assets shall be distributed among the Members in accordance with
Section 11.2(a) as if an amount of cash equal to the fair market value of the
assets (determined as of the record date for such distribution, but net of any
liabilities to which the assets are subject or that will be transferred to the
recipient Members) were distributed on the date of distribution.  In
implementing the foregoing, the Members of the Liquidating Trustee shall to the
extent possible while satisfying the requirements of Section 11.2(a), distribute
assets to each Member in-kind in accordance with, and as identified by, such
Member on the basis of its contribution of such assets to the LLC, unless the
Member which is to receive such in kind distribution directs the Members, or the
Liquidating Trustee, as the case may be, to liquidate any asset so allocated to
it and distribute to such Member the proceeds of such liquidation.  If the
terminal operations of the LLC previously operated separately by the Members in
any port have

 

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been consolidated prior to the winding up, dissolution or liquidation of the
LLC, and if more than one of the Members desires to operate stevedoring and
terminal services in any such port, the Members shall use their best efforts to
physically divide the consolidated terminal and to negotiate a division of such
terminal’s lease to permit the separate operation of stevedoring and container
services in such terminal by all such Members.  The Members also agree to use
their best efforts to avoid or minimize any tax arising from a distribution of
such assets under Code Section 704(c)(l)(B) or Code Section 737.  Whether or not
such consolidation has taken place, in the event of any such unwinding,
dissolution or liquidation, the Members shall cooperate and share all
information in connection with the LLC’s business to permit such separate
operation, but such information shall be held strictly confidential by each
Member.  Furthermore, if the Administrative Services Agreement is in effect as
of the event of dissolution, SSA will share its information systems with Matson
pursuant to the terms of the Administrative Services Agreement.  In addition to
the foregoing, if the dissolution of the LLC results from an event referred to
in Section 11.1(a), (d), (e), (h), (i), (j), (k), (l), (m), (n), (o) or
(p) caused by a Member (the “Responsible Member”) (i) prior to the consolidation
of any container terminal operations of the LLC in any of the ports of Los
Angeles/Long Beach, Oakland or Seattle, each Member shall receive a distribution
of and shall assume all future obligations under each terminal lease contributed
to or assigned or sublet to the LLC by the Responsible Member, or its
Affiliates, upon entering into this Agreement, or (ii) after any container
terminal operations of the LLC that have been consolidated in any of the ports
of Los Angeles/Long Beach, Oakland or Seattle prior to the dissolution of the
LLC, the Responsible Member shall receive a distribution of a physical portion
of the consolidated lease premises reasonably suitable to carry on independent
terminal operations, and shall be liable for a portion of the lease of such
terminal, in each case to an extent equal to the Responsible Member’s Percentage
Interest; provided, however, that, if the Responsible Member determines not to
engage in such terminal operations, both Members shall use their best efforts to
mitigate such liability, through sublease, negotiations for lease termination
with the affected port or otherwise as may be agreed by the Members acting
reasonably and in good faith.

 

11.4         Certificate of Cancellation.  When all debts, liabilities and
obligations have been paid and discharged or adequate provisions have been made
therefor and all of the remaining property and assets have been distributed to
the Members, a certificate of cancellation shall be executed in duplicate and
verified by all Members or the Liquidating Trustee, which certificate shall set
forth the information required by the Delaware Limited Liability Company Act. 
Duplicate originals of the certificate of cancellation shall be delivered to the
Secretary of State.

 

11.5         Effect of Filing Certificate of Cancellation.  Upon the issuance of
the certificate of cancellation, the existence of the LLC shall cease.  The
Members or the Liquidating Trustee shall have authority to distribute any LLC
property discovered after dissolution, convey real estate and take such other
action as may be necessary on behalf of and in the name of the LLC.

 

11.6         Withdrawal or Reduction of Members’ Capital Contributions.  A
Member shall not receive out of the LLC’s property any part of its Capital
Contribution until all liabilities of the LLC, except liabilities to Members on
account of their Capital Contributions, have been paid or provided for or there
remains property of the LLC sufficient to pay them.

 

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11.7         Member’s Purchase Option.

 

(a)           Notwithstanding the foregoing provisions of this Section 11, upon
the occurrence of any of the events set forth in Subsections (a), (d), (e), (h),
(i), (j), (k), (l), (n), (o) or (p) of Section 11.1, if the Responsible Member
notifies the other Member in writing within thirty (30) days of receiving actual
notice of such event that it does not wish to continue to engage in terminal
operations, the other Member shall have the option, rather than continuing the
LLC (unless dissolution as a result of such event has occurred as a matter of
law) pursuant to the first paragraph of Section 11.1, or dissolution and
distribution of assets pursuant to the foregoing provisions of this Section 11,
to purchase, or to have an Affiliate purchase, the Responsible Member’s
Percentage Interest in the LLC at the purchase price determined pursuant to
Section 11.7(b).  Such option shall be exercised by the delivery of written
notice to the Responsible Member and the Board of Managers.  Such Member may
exercise such option at any time during a period of sixty (60) days after the
date on which the Board of Managers and the exercising Member receives actual
knowledge of any such event.  Such purchase shall be completed within ninety
(90) days of giving of such notice, plus any reasonable time required to
ascertain the purchase price pursuant to Section 11.7(b).

 

(b)           The purchase price to be paid for a Percentage Interest subject to
this Agreement in the event of any option purchase pursuant to
Section 11.7(a) shall be equal to the agreed value of the LLC multiplied by the
Percentage Interest being transferred, without discount based on ownership of a
minority interest and without premium for any reason.  In the event of any
transfer where the value is not agreed to by the parties, the LLC shall engage
an appraiser to determine the value of the LLC.  If the Members cannot agree on
an appraiser, the LLC shall engage three appraisers who are skilled in
appraising businesses of a size comparable to the LLC.  In such case, each
Member shall select one appraiser and the appraisers so selected shall select
the third appraiser.  If there are three appraisers and they are unable to agree
unanimously as to the value of the LLC, then the decision of two of the three
shall be binding for all purposes.

 

(c)           Except as provided in the last sentence of this Section 11.7(c),
the payment by the terminating Member of the purchase price pursuant to
Section 11.7(b) shall be in lieu of any other right, claim recourse or remedy by
either Member or its Affiliates against the other Member or its Affiliates under
this Agreement, any other Definitive Agreement, or any agreement entered into
pursuant to Section 4.4, or in any way relating to the business relationship
between the Members and their Affiliates envisioned by this Agreement, and the
Definitive Agreement or any such other agreement, and the other transactions
contemplated hereby and thereby.  Notwithstanding any sale pursuant to
Section 11.7(a) and (b), both Members and each of its Affiliates liable
therefor, shall remain liable for any breach of this Agreement, or any other
Definitive Agreement or such other agreement occurring, and any indemnity and
other obligations arising, prior to the sale, under this Agreement or any other
Definitive Agreement or such other agreement.

 

11.8         Damages.  In the event of any violation of Sections 4.2, 4.15 or
12.11, the non-breaching Member may be awarded and may recover any damages
sustained as a result of such violation, except that in no event shall such
non-breaching party be entitled to recover any special or punitive damages.

 

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11.9                        [RESERVED]

 

11.10                 Sale of the Vessels of Matson.

 

(a)                                 Notwithstanding any provision of this
Agreement to the contrary, if Matson sells or otherwise disposes of vessels with
the result that Matson’s volume of business enjoyed by the LLC prior to such
sale or disposition reduces by eighty percent (80%) or more (a “Vessel
Disposition”), and if the purchaser or charterer of such vessels does not enter
into a stevedoring contract assuring the LLC of a volume comparable to the
volume of business being enjoyed by the LLC prior to the Vessel Disposition at
rates and on terms substantially the same as those applicable to Matson, then
such sale shall be treated as an event causing dissolution pursuant to Section
11.1(p), and SSA Ventures may, at its option, elect to dissolve and wind up the
LLC.

 

(b)                                 If the Vessel Disposition occurs at any time
prior to the later of July 9, 2006 or the consolidation of the LLC’s terminal
operations in the Port of Oakland by means of a new lease, and if SSA Ventures
elects to dissolve the LLC by reason thereof, Matson (directly or through MVI)
shall pay to SSA Ventures an amount equal to all distributions made by the LLC
to MVI pursuant to Section 8.1 of this Agreement at any time on or prior to such
Vessel Disposition, plus or minus, as the case may be, all increases or
decreases in the Capital Account of MVI from the amount set forth in
Section 6.6; provided, however, that such amount payable by Matson shall be
reduced by (x) any distributions made by the LLC to MVI or SSA Ventures pursuant
to Section 8.1 (plus any increase in their respective Capital Accounts)
attributable to the LLC’s profit margin on work performed by the LLC for third
parties who have been historic customers of MTI, and (y) any distributions made
to SSA Ventures pursuant to Section 8.1 (or any increase in its Capital Account)
attributable to improved profit margins recognized by the LLC as a result of
physical consolidation of the LLC terminals in any West Coast port.  Neither
Matson nor any of its Affiliates shall have any obligation to make any payment
under this Section 11.10 with respect to a Vessel Disposition occurring on or
after the later of July 9, 2006 or the consolidation of the LLC’s terminal
operations in the Port of Oakland by means of a new lease.

 

(c)                                  Except as provided in the last sentence of
this Section 11.10(c), the payment  pursuant to Section 11.10(b) shall be in
lieu of any other right, claim recourse or remedy by either Member or its
Affiliates against the other Member or its Affiliates under this Agreement, any
other Definitive Agreement, or any agreement entered into pursuant to
Section 4.4, or in any way relating to this business relationship between the
Members and their Affiliates envisioned by this Agreement, and the Definitive
Agreement or any such other agreement, and the other transactions contemplated
hereby and thereby.  Notwithstanding any payment pursuant to Section 11.10(b),
both Members and each of its Affiliates liable therefor, shall remain liable for
any breach of this Agreement, or any other Definitive Agreement or such other
agreement occurring, and any indemnity and other obligations arising, prior to
the payment, under this Agreement or any other Definitive Agreement or such
other agreement.

 

(d)                                 The Members acknowledge and agree that any
payments to be made pursuant to Section 11.10(b) is liquidated damages but is
not a penalty, and that the provisions of this Agreement providing for the
payment of the same are completely and entirely reasonable under the
circumstances existing at the time this Agreement is made.

 

30

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Section 12 - MISCELLANEOUS

 

12.1                        Notice.  Except for notices specifically provided
for in this Agreement, any notice, offer, acceptance, demand, request, consent
or other communication required or permitted under this Agreement shall be in
writing and shall be deemed to have been duly given or made either (1) when
delivered personally to the party to whom it is directed (or any officer or
agent of such party), or (2) three (3) days after being deposited in the United
States express mail, certified or registered, postage prepaid, return receipt
requested, and properly addressed to the party to whom it is directed, or
(3) faxed to a Member’s fax number.  A communication will be deemed to be
properly addressed if sent to a party at the address or fax number provided in
Exhibit A.

 

The LLC or any Member may at any time during the term of this Agreement change
the address to which notices and other communications directed to it must be
sent by providing written notice of a new address to the other parties to this
Agreement.  Any such change of address will be effective ten (10) days after
such notice is given.

 

12.2                        Governing Law.  This Agreement will be construed and
the rights, duties and obligations of the parties will be determined in
accordance with the laws of the State of Delaware without regard to its choice
of law rules.

 

12.3                        Successors and Assigns.  This Agreement will bind
and benefit the parties and their respective heirs, executors, legal
representatives and permitted successors and assigns.  Nothing contained in this
Section 12.3 will be construed to permit any assignment or conveyance of any
interest in the LLC not otherwise expressly permitted elsewhere in this
Agreement.

 

12.4                        Headings.  Headings used in this Agreement have been
included for convenience and ease of reference only and will not in any manner
influence the construction or interpretation of any provision of this Agreement.

 

12.5                        Entire Agreement; Amendment.  This Agreement and the
Definitive Agreements represents the entire understanding of the parties with
respect to its subject matter.  There are no other prior or contemporaneous
agreements, either written or oral, among the parties with respect to this
subject.  This Agreement may be amended only by a written document signed by all
of the Members.

 

12.6                        Waiver.  No right or obligation under this Agreement
will be deemed to have been waived unless evidenced by a writing signed by the
party against whom the waiver is asserted, or its duly authorized
representative.  Any waiver will be effective only with respect to the specific
instance involved, and will not impair or limit the right of the waiving party
to insist upon strict performance in any other instance, in any other respect,
or at any other time.

 

12.7                        Severability.  The parties intend that this
Agreement be enforced to the greatest extent permitted by applicable law. 
Therefore, if any provision of this Agreement, on its face or as applied to any
person or circumstance, is or becomes unenforceable to any extent, the remainder
of this Agreement and the application of that provision to other persons or
circumstances, or to any other extent, will not be impaired.

 

31

--------------------------------------------------------------------------------

 

12.8                        Attorneys’ Fees.  If any litigation or other dispute
resolution proceeding is commenced between parties to this Agreement to enforce
or determine the rights or responsibilities of such parties, the prevailing
party or parties in any such proceeding will be entitled to receive, in addition
to such other relief as may be granted, its reasonable attorneys’ fees, expenses
and costs incurred preparing for and participating in such proceeding.

 

12.9                        Counterparts.  This Agreement may be executed in any
number of counterparts, each of which will be deemed to be an original and all
of which together will constitute a single agreement.  Executed facsimile
signature pages shall be treated as originals.

 

12.10                 Waiver of Action for Partition.  For the term of the LLC
and for the period of the winding up of its business following dissolution, each
party irrevocably waives any right it may have to maintain any action for
partition with respect to any of the LLC’s assets.

 

12.11                 Competing Interests; Right of First Refusal.

 

(a)                                 Except as may be permitted under the terms
of Sections 12.11(b), (c), (d) and (e) below, the Members agree that neither
they nor any of their Affiliates shall engage in a similar business to that of
the LLC in the States of California, Oregon or Washington without the unanimous
approval of all of the Members; provided, that, without seeking or obtaining the
consent of all of the Members, SSA or its Affiliates may (i) provide stevedoring
and terminal services to COSCO in Southern California (either as an independent
contractor or in a joint venture or similar arrangement with COSCO),
(ii) participate as a minority shareholder in or vendor of services to the
Centennial Stevedoring Services, Inc. joint venture in Oakland and Los Angeles,
(iii) provide stevedoring and terminal services for breakbulk, bulk cargo and
other handling operations unrelated to container gantry crane supplied services,
(iv) provide lines handling services in any terminal, (v) provide container and
equipment maintenance, power shop services, crane maintenance, electronic data
interchange or other information services to third party customers conducted at
or as part of facilities of such third party customers, or (vi) provide
stevedoring and terminal services at Terminal 2 in Portland, Oregon.

 

(b)                                 Subject to the terms expressed in Sections
12.11(c), (d) and (e), the Members agree that if they or any of their Affiliates
desire to undertake any business opportunity or activity (a “Business
Opportunity”) that is within the scope of the primary purpose of the LLC and
not, as to SSA, subject to any of the exceptions for SSA referred to in clauses
(i) through (vi) of Section 12.11(a), the LLC shall have a right of modification
and first refusal in accordance with the provisions of Section 12.11(c) to
undertake such Business Opportunity and if the LLC declines to undertake such
Business Opportunity following compliance by the Members with the provisions of
Sections 12.11(c), (d) and (e), as applicable, the Member or its Affiliate
desiring to undertake such Business Opportunity shall be free to do so.

 

(c)                                  To implement the right of first refusal,
the Member proposing a Business Opportunity (the “Proposing Member”) shall
provide the other Member (the “Receiving Member”) with a reasonably detailed
proposed business plan (a “Proposed Business Plan”) setting forth a forecast of
the capital expenditures required for such Business Opportunity and an operating
plan for such Business Opportunity for its first three years, together with a
proposed equity participation

 

32

--------------------------------------------------------------------------------

 

and financing plan for such Business Opportunity.  Following the submission of
the Proposed Business Plan and for the next thirty (30) days, management of the
Proposing Member and management of the Receiving Member shall work in good faith
to develop jointly the Proposed Business Plan.  If the Business Opportunity
would involve the LLC entering into a new joint venture or similar enterprise
with an unrelated party to lease and operate a container terminal in the ports
of Los Angeles/Long Beach, Oakland/San Francisco or Seattle/Tacoma (other than
with COSCO in the port of Los Angeles/Long Beach) that would provide stevedoring
and related services to third- party customers similar to such services
performed by the LLC at such locations (any such Business Opportunity being a
“Core Business Opportunity”), then, unless such Core Business Opportunity is
approved by both of the Members and pursued by the LLC, neither of the Members,
or their Affiliates, shall be permitted to pursue such Core Business
Opportunity.  The good faith joint development of any Business Opportunity shall
include, but not be limited to (A) modifications relating to fair and reasonable
allocations of interest participations therein based upon the Percentage
Interests of the Members and the consideration made, contributed or otherwise
given by any other person or proposed new member with respect thereto, and
(B) modifications relating to reasonable use of, and the review of reasonable
alternatives to, additional capital or guaranteed financing required for such
Business Opportunity.  If (i) the Business Opportunity would not constitute a
Core Business Opportunity, and (ii) the Receiving Member declines to approve the
pursuit of the Business Opportunity by the LLC for any reason within thirty (30)
days following presentation of the Business Opportunity by the Proposing Member,
and (iii) the Proposing Member has engaged in good faith negotiations with the
Receiving Member over the terms of or modifications to the Business Opportunity
(or offered to engage in good faith negotiations declined by the Receiving
Member), then the Proposing Member and/or its Affiliates may pursue the Business
Opportunity independent of the LLC on substantially the same basis as set forth
in its Proposed Business Plan with such modifications to the Business Plan as
the Proposing Member shall deem appropriate; provided, that the Proposing Member
shall extend back to the LLC the right to pursue the Business Opportunity if, in
the course of implementing the Business Opportunity, the Proposing Member or its
Affiliates elect to pursue the Business Opportunity on a basis substantially
similar to that described in any alternative Business Plan proposed by the
Receiving Member.

 

(d)                                 SSA Ventures and COSCO Terminals
America, Inc., a Delaware corporation (“COSCO Terminals”), formed Pacific
Maritime Services, L.L.C., a Delaware limited liability company (“PMS”),
effective July 1, 2001, to operate a marine terminal at the Pacific Container
Terminal on Pier J at the Port of Long Beach.  SSA has provided Matson with
certain financial information concerning PMS.  Matson or MVI shall be entitled,
on or before [June 7, 2002], to make an offer to purchase from SSA Ventures an
ownership interest in PMS.  The structure of any such purchase would be subject
to negotiation with SSA and SSA Ventures, but would be expected to involve a
direct or indirect purchase of not more than 35% of SSA Venture’s membership
interest in PMS.  If Matson or MVI makes an offer to purchase an ownership
interest in PMS, during the thirty (30) days following the offer the chief
executive officers of Matson and SSA shall meet to discuss the terms and
conditions of such offer, but SSA and SSA Ventures shall have no obligation to
accept the offer if they conclude, in their sole discretion, that the
consideration, terms or  conditions in such offer are unsatisfactory.  Any
purchase of an ownership interest in PMS shall be subject to the approval of
COSCO Terminals.  If Matson or MVI does not acquire a direct or

 

33

--------------------------------------------------------------------------------

 

indirect interest in PMS, SSA Ventures agrees that in connection with any
marketing efforts or negotiations by personnel of SSA Ventures or SSA to attract
potential shipping line customers to container terminals located in the Port of
Los Angeles/Long Beach, SSA Ventures or SSA, as applicable, shall invite a
representative of Matson or MVI to participate in any such marketing efforts or
negotiations to ensure that the LLC is not prejudiced with respect to any
business opportunity to attract customers to the facilities of the LLC. 
Notwithstanding the foregoing, Matson and MVI acknowledges that the requirements
of customers may be better served at the facilities operated by PMS than those
operated by the LLC.

 

(e)                                  If SSA at any time has an opportunity
involving the acquisition of an interest in Centennial Stevedoring or in Yusen
Terminals, Inc. that, when added to SSA’s existing minority interest in
Centennial Stevedoring would give SSA an effective controlling interest in
either entity, then SSA shall propose either (i) that the LLC acquire the
available interest in Centennial Stevedoring from Yusen Terminals, Inc. or
acquire the shares of Yusen Terminals, Inc., with SSA retaining its current
minority interest in Centennial Stevedoring, or (ii) that the transaction be
structured in a manner such that SSA and Matson, upon consummation of the
transaction, will hold, directly or indirectly, equity interests in Centennial
Stevedoring in equal percentages to the respective Percentage Interests of SSA
Ventures and MVI in the LLC, in which case SSA would contribute its minority
interest in Centennial Stevedoring and such minority interest will be valued
(for purposes of determining Matson’s contribution and the balance of SSA’s
contribution, if any) on the same basis as the interest in Centennial
Stevedoring or Yusen Terminals, Inc. being acquired.  If Matson declines to
approve or participate in the acquisition of such an interest in Centennial
Stevedoring or Yusen Terminals, Inc., then SSA and/or its Affiliates shall be
permitted to acquire that interest.  If SSA or its Affiliates acquires a
controlling interest in Centennial Stevedoring or an interest in Yusen
Terminals, Inc., SSA shall be entitled to pursue the development of container
and other terminal services business through Centennial Stevedoring or Yusen
Terminals, Inc., as the case may be, in a manner comparable to the activities of
Centennial Stevedoring or Yusen Terminals, Inc. prior to the time of the
acquisition, including business development that would be competitive with the
business of the LLC.

 

12.12                 Rent Adjustment.  The Members agree that any retroactive
rent adjustment imposed by the Port of Seattle as a result of Matson not
entering into a new terminal lease at such port due to the provisions of this
Agreement shall be an expense of, and be paid by, the LLC up to an amount not to
exceed $2,000,000.

 

12.13                 Oakland Lease Benefit.  The Members acknowledge that
Matson’s lease with the Port of Oakland, which it is transferring to the LLC,
and which currently runs through the year 2008, is at a favorable rate in light
of current market rates.  Article XI of the Stevedoring, Terminal, CFS, Vehicle
Processing and Maintenance and Repair Services Agreement dated as of July 10,
1999 between the LLC and Matson (the “Matson Stevedoring Agreement”) provides
for adjustments to the rates and charges in the Rate Schedules (such term being
used in this Agreement as defined in the Matson Stevedoring Agreement) on the
basis of changes in Rent (such term being used in this Agreement as defined in
the Matson Stevedoring Agreement) and other factors.   Notwithstanding the
adjustments contemplated in Article XI of the Matson Stevedoring Agreement,
during the period following the consolidation of the LLC’s terminal operations
in the Port of Oakland at Berths 57-59 (the “New Oakland Terminal”) through
December 31, 2005, the rates and

 

34

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

*Portions of this exhibit have been omitted and filed separately with the
Securities and Exchange Commission.  Such portions have been omitted pursuant to
a request for confidential treatment.

 

charges under the Matson Stevedoring Agreement for services in the Port of
Oakland shall not be adjusted for any increases in Rent, and the Rent component
of Matson’s throughput rate in the Port of Oakland shall be based on an
annualized cost of $* (which equates to $* per lift based on Matson’s current
volume of * lifts per year), subject to adjustment for significant variances in
Matson’s throughput volume as described below.  Commencing on January 1, 2006,
the rates and charges under the Matson Stevedoring Agreement for services in the
Port of Oakland shall be adjusted on a phased-in basis for each calendar quarter
to reflect the increase in Rent at the New Oakland Terminal, with the Rent
component of Matson’s throughput rate and Matson’s transshipment rate in the
Port equal to the amounts set forth on Exhibit B attached hereto, subject to
adjustments to the Port of Oakland Tariff or for significant variances in
Matson’s throughput volume as described below.  The rates and charges set forth
on Exhibit B, which were based on the ratio of Matson’s projected volume of *
loaded TEU’s to Matson’s projected throughput, shall be adjusted on January 1,
2006 and shall be based on the ratio of Matson’s year 2005 actual loaded TEU
volume to actual throughput.  Subsequently, on each July 1 commencing on July 1,
2006, the rates and charges set forth on Exhibit B shall be further adjusted and
shall be based on the ratio of Matson’s actual loaded TEU volume to actual
throughput during the twelve months just ended.  In addition, the rates and
charges set forth on Exhibit B for the periods commencing on January 1, 2006
shall be adjusted at any point during any year (i) to reflect changes in the
Port of Oakland Tariff, or (ii) if Matson’s actual throughput volume at Oakland
Berths 57-59 deviates by more than * annual container handlings.  Commencing on
January 1, 2009 and thereafter the throughput and transshipment rates shall be
adjusted (i) under the formula provided in Article XI of the Matson Stevedoring
Agreement, (ii)  for significant annualized throughput variances in excess of *
container handlings, (iii) to reflect changes in the Port of Oakland Tariff, and
(iv) on each July 1 based on the ratio of  Matson’s actual loaded TEU volume to
actual throughput during the 12 months just ended.

 

12.14                 Material Facts.  During the period that it is a Member,
each Member covenants that it will disclose to the LLC and the other Members,
facts of which such Member has actual knowledge, the nondisclosure of which
could materially adversely affect the LLC or the conduct of its business;
provided, however, that this provision shall not require the disclosure of
confidential or proprietary information related to the conduct of a Member’s own
business.

 

12.15                 Disputes.

 

(a)         Negotiations.  The Members, promptly and in good faith, shall
attempt to resolve any dispute arising under this Agreement by negotiation
between the chief executive officers of MVI and SSA Ventures.  Either Member may
give to the other Member written notice of any dispute and, within ten (10) days
after the giving of such notice, the recipient of such notice shall give a
written response to the other Member.  Each notice of a dispute and each
response to any such notice shall include a statement of the position of the
party giving such notice or response in respect of such dispute and a summary of
arguments supporting such position.  Within fifteen (15) days after the giving
of a notice of a dispute under this subsection, such chief executive officers
shall meet at a mutually acceptable time and place, and thereafter as often as
either of them reasonably deem necessary, to attempt to resolve such dispute. 
All reasonable requests for information made by any Member to the other shall be
honored.  If any dispute has not been resolved by negotiation pursuant to this
subsection within thirty (30) days after the giving of

 

35

--------------------------------------------------------------------------------

 

the notice of such dispute, then the other Member may initiate mediation of such
dispute pursuant to Section 12.15(b).  All negotiations pursuant to this
subsection shall be confidential and shall be treated as compromise and
settlement negotiations.  Nothing said or disclosed, and no document produced,
in the course of such negotiations which is not independently discoverable shall
be offered, or received as evidence, or used for impeachment or for any other
purpose in any arbitration or litigation.

 

(b)         Mediation.  All disputes arising out of this Agreement not resolved
pursuant to Section 12.15(a), shall first be submitted to mediation, which shall
focus on the needs of everyone concerned and seek to solve problems
cooperatively with an emphasis on dialogue and accommodation.  The goal of the
mediation shall be to preserve and enhance relationships by developing a
mutually acceptable resolution that will fulfill the needs of everyone
concerned.  Any Member desiring mediation may begin the process by giving the
other Members a written Request to Mediate, describing the issues involved and
inviting the other Members to join with the requesting Member to name a mutually
agreeable mediator and a time frame for the mediation meeting.  The Members and
the mediator may adopt any procedural format that seems appropriate for the
particular dispute.  The contents of all discussion during the mediation shall
be confidential and nondiscoverable in subsequent arbitration or litigation, if
any.  If the Members can agree upon a mutually acceptable resolution with
respect to the dispute, it shall be reduced to writing, signed by all Members,
and the dispute shall be at an end.  If the result of the mediation is a
recognition that the dispute cannot be successfully mediated, or if a Member
refuses to mediate or to name a mutually acceptable mediator within a period of
time that is reasonable considering the urgency of the disputed matter, or if
for any reason mediation is not concluded by settlement of the dispute within
thirty (30) days after the giving of the Request to Mediate, then any Member who
desires dispute resolution may seek arbitration.

 

(c)          Arbitration.  Any dispute, controversy or claim among the Members
arising out of or relating to this Agreement, which has not been settled by
mediation will be settled by arbitration in accordance with the commercial
rules of the American Arbitration Association as then in effect.  In any
arbitration hereunder, each Member will select one arbitrator and the two
arbitrators so-selected shall select a third.  The three arbitrators selected
will each have one vote, and a majority vote of the arbitrators will be
binding.  The arbitration will take place in Los Angeles, California.  The
arbitrators will apply the law of the State of Delaware without regard to its
choice of law principles.  Judgment upon the award rendered by the arbitrators
may be entered in any court for a judicial acceptance of the award and an order
of enforcement.  Each party will bear its own expenses of the arbitration, but
the Arbitrators’ fees and costs will be borne equally between the parties
participating in the arbitration.

 

12.16                 Refund Allocations.  All refunds authorized and/or paid by
Pacific Maritime Association to MVI or any Affiliate thereof, or to SSA or any
Affiliate thereof, relating to their respective activities for periods prior to
the date of the contribution of assets referred to in Section 6.1 above by MVI
and SSA Ventures, shall remain the property of MVI and SSA or their respective
Affiliates, and all refunds authorized and/or paid by Pacific Maritime
Association relating to the activities of the LLC for periods on or after the
date of such contributions shall be the property of, and shall be immediately
paid over to the LLC.

 

36

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(SIGNATURE PAGE FOLLOWS)

 

37

--------------------------------------------------------------------------------

 

IN WITNESS OF THEIR AGREEMENT, the parties have executed this Amended and
Restated Limited Liability Company Agreement as of the year and day first above
written.

 

 

 

SSA VENTURES, INC.

 

 

 

 

 

By:

/s/ Charles Sadoski

 

 

Name:

Charles Sadoski

 

 

Title:

Senior Vice President

 

 

 

MATSON VENTURES, INC.

 

 

 

 

 

By:

/s/ C. Bradley Mulholland

 

 

Name:

C. Bradley Mulholland

 

 

Title:

President

 

38

--------------------------------------------------------------------------------

 

EXHIBIT A

 

MEMBER

 

PERCENTAGE
INTEREST

 

 

 

 

 

SSA Ventures, Inc.

1131 S.W. Klickitat Way

Seattle, WA  98134

Attention:  Jon Hemingway

Fax:  (206) 623-0179

 

65

%

 

 

 

 

Matson Ventures, Inc.

333 Market Street, 30th Floor

San Francisco, CA  94120

Attention:  C. Bradley Mulholland

Fax:  (415) 947-4234

 

35

%

 

 

 

 

TOTAL:

 

100.0

%

 

39

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

*Portions of this exhibit have been omitted and filed separately with the
Securities and Exchange Commission.  Such portions have been omitted pursuant to
a request for confidential treatment.

 

Oakland Berths 57/59

-  

Facility Rate

EXHIBIT B

 

 

 

Est Terminal Completion Date =

8/1/02

 

 

Port of Oakland Facility Rate to SSAT

 

Year

 

From

 

To

 

$/LD TEU

 

1

 

8/1/02

 

7/31/03

 

$

*

 

2

 

8/1/03

 

7/31/04

 

$

*

 

3

 

8/1/04

 

7/31/05

 

$

*

 

4

 

8/1/05

 

7/31/06

 

$

*

 

5

 

8/1/06

 

7/31/07

 

$

*

 

6

 

8/1/07

 

7/31/08

 

$

*

 

7

 

8/1/08

 

7/31/09

 

$

*

 

8

 

8/1/09

 

7/31/10

 

$

*

 

9

 

8/1/10

 

7/31/11

 

$

*

 

10

 

8/1/11

 

7/31/12

 

$

*

 

11

 

8/1/12

 

7/31/13

 

$

*

 

12

 

8/1/13

 

7/31/14

 

$

*

 

13

 

8/1/14

 

7/31/15

 

$

*

 

14

 

8/1/15

 

7/31/16

 

$

*

 

 

Matson to SSAT

 

Throughput

 

Transhipment

 

Annual LD TEU

 

*

 

 

 

Rate\TEU

 

Annual Cost

 

 

 

$   *

 

$

*

 

 

 

Ttl Annual Cost

 

$

*

 

 

 

Throughput

 

*

 

 

 

$/Move

 

$

*

 

 

 

 

 

 

 

 

 

Final Rate

 

$

*

 

$

*

 

Initial Rate

 

$

*

 

$

*

 

Variance

 

$

*

 

$

*

 

Equal Increases

 

*

 

*

 

$/Increase

 

$

*

 

$

*

 

 

 

 

 

50% = $*

 

 

SSAT Facility Rate to Matson Navigation Company

 

 

 

Effective Dates

 

Facility

 

Approx Annual

 

+ Transhipment $ (per Move)

 

 

 

From

 

To

 

$/Thrpt

 

MNC Facility $ †

 

Load

 

Empty

 

 

 

7/1/01

 

6/30/02

 

$

*

 

$

*

 

Labor + $ *

 

Labor

 

 

 

7/1/02

 

6/30/03

 

$

*

 

$

*

 

Labor + $ *

 

Labor

 

 

 

7/1/03

 

6/30/04

 

$

*

 

$

*

 

Labor + $ *

 

Labor

 

 

 

7/1/04

 

6/30/05

 

$

*

 

$

*

 

Labor + $ *

 

Labor

 

Incrs

 

7/1/05

 

12/31/05

 

$

*

 

$

*

 

Labor + $ *

 

Labor

 

1

 

1/1/06

 

3/31/06

 

$

*

 

 

 

Labor + $ *

 

Labor

 

2

 

4/1/06

 

6/30/06

 

$

*

 

 

 

Labor + $ *

 

Labor

 

3

 

7/1/06

 

9/30/06

 

$

*

 

 

 

Labor + $ *

 

Labor

 

4

 

10/1/06

 

12/31/06

 

$

*

 

$

*

 

Labor + $ *

 

Labor

 

5

 

1/1/07

 

3/31/07

 

$

*

 

 

 

Labor + $ *

 

Labor

 

6

 

4/1/07

 

6/30/07

 

$

*

 

 

 

Labor + $ *

 

Labor

 

7

 

7/1/07

 

9/30/07

 

$

*

 

 

 

Labor + $ *

 

Labor

 

8

 

10/1/07

 

12/31/07

 

$

*

 

$

*

 

Labor + $ *

 

Labor

 

9

 

1/1/08

 

3/31/08

 

$

*

 

 

 

Labor + $ *

 

Labor

 

10

 

4/1/08

 

6/30/08

 

$

*

 

 

 

Labor + $ *

 

Labor

 

11

 

7/1/08

 

9/30/08

 

$

*

 

 

 

Labor + $ *

 

Labor

 

12

 

10/1/08

 

12/31/08

 

$

*

 

$

*

 

Labor + $ *

 

Labor

 

13

 

1/1/09

 

6/30/09

 

$

*

 

 

 

Labor + $ *

 

Labor

 

14

 

7/1/09

 

6/30/10

 

$

*

 

$

*

 

Labor + $ *

 

Labor

 

 

--------------------------------------------------------------------------------

†  Approximate Annual MNC Facility Cost assumes equal quarterly divison of
annual Loaded TEU volume.

+  Current Transhipment Labor Rate = $  *

 

Assumptions:

 

1 Annual loaded TEU volume remains at *

 

2 Loaded TEU includes units loaded with automobiles

 

Rates assume there are no Port of Oakland Tariff increases during this time
period

 

40

--------------------------------------------------------------------------------