Exhibit 10.1

LIMITED LIABILITY COMPANY AGREEMENT

FOR

VERDANT VENTURES ADVISORS, LLC

A DELAWARE LIMITED LIABILITY COMPANY

THE SECURITIES ISSUED PURSUANT TO OR REPRESENTED BY THIS AGREEMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR REGISTERED OR
QUALIFIED UNDER ANY STATE SECURITIES LAWS AND ARE BEING OFFERED AND SOLD IN
RELIANCE ON EXEMPTIONS FROM THE REGISTRATION AND QUALIFICATION REQUIREMENTS OF
SAID ACT AND SUCH LAWS. SUCH SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD,
DELIVERED AFTER SALE, ASSIGNED, TRANSFERRED, PLEDGED, HYPOTHECATED OR OTHERWISE
DISPOSED OF UNLESS REGISTERED AND QUALIFIED UNDER APPLICABLE FEDERAL AND STATE
SECURITIES LAWS OR UNLESS, IN THE OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY, SUCH REGISTRATION AND QUALIFICATION ARE NOT REQUIRED. ANY TRANSFER OF
SUCH SECURITIES IS SUBJECT TO OTHER RESTRICTIONS, TERMS AND CONDITIONS SET FORTH
HEREIN.

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LIMITED LIABILITY COMPANY AGREEMENT

FOR

VERDANT VENTURES ADVISORS, LLC

A DELAWARE LIMITED LIABILITY COMPANY

This Limited Liability Company Agreement (this “Agreement”) is made as of
April 14, 2010, by and among Verdant Ventures Managers, LLC, a Delaware limited
liability company (“Managers LLC”) Silicon Prairie Partners, LLC, a California
limited liability company, and UTEK Corporation, a Florida corporation (“UTEK”),
and those other Persons who shall hereafter be admitted as Members of the
Company, with reference to the following facts:

A. A Certificate of Formation of Verdant Ventures Advisors, LLC, setting forth
the information required by Section 18-201 of the Delaware Limited Liability
Company Act, 6 Del. C. Sections 18-101 et seq. (the “Delaware Act”) was executed
and filed with the Delaware Secretary of State on April 14, 2010.

B. The Members desire to enter into, adopt and approve this Agreement as the
operating agreement for the Company.

NOW, THEREFORE, in consideration of the mutual covenants and conditions herein,
the Members agree as follows:

1. Definitions. As used in this Agreement, capitalized terms shall have the
meanings ascribed to them herein or in Appendix A attached hereto.

2. Organizational Matters.

2.1 Formation. Pursuant to the Act, the Members formed a limited liability
company under the Act by filing the Certificate with the Delaware Secretary of
State and entering into this Agreement. The rights duties, obligations and
liabilities of the Members shall be determined pursuant to, and the business,
management and affairs of the Company shall be governed exclusively by, the Act
and this Agreement. To the extent that any provision of this Agreement is
inconsistent with any provision of the Act, this Agreement shall govern to the
extent permitted by the Act.

2.2 Name. The name of the Company shall be “Verdant Ventures Advisors, LLC.” The
business of the Company may be conducted under that name or, on compliance with
applicable laws, any other name that the Manager deems appropriate or advisable.
The Manager on behalf of the Company shall file any certificates, articles,
fictitious business name statements and the like, and any amendments and
supplements thereto, as the Manager considers appropriate or advisable.

2.3 Term. The Company shall commence upon the date of the filing of the
Certificate with the Secretary of State of Delaware and shall continue until one
year after the date of dissolution of the last remaining Investment Partnership,
unless sooner dissolved as provided in this Agreement or unless the term of the
Company is extended by the written consent of the Manager.

 

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2.4 Office and Agent. The Company shall continuously maintain an office and
registered agent in the State of Delaware as required by the Act. The principal
office of the Company shall be at 130 Lytton Ave, Suite 210, Palo Alto,
California 94301, or at such other location as the Manager may determine. The
registered agent shall be as stated in the Certificate or as otherwise
determined by the Manager.

2.5 Purpose of Company. The purpose of the Company is to engage in any lawful
activity for which a limited liability company may be organized under the Act.
The Business of the company shall be (i) to act as the general partner or
manager (or similar agent) with respect to one or more Investment Partnerships
(as defined in section 5.1.1) or otherwise serving as a manager or advisor of
one or more Investment Partnerships, (ii) to make equity investments as a
limited partner or member in one or more Investment Partnerships, and (iii) to
deal with any Securities and other assets that the Company may receive from time
to time from, or with respect to investments made in, one or more Investment
Partnerships.

2.6 Addresses of Members. The addresses of the Members shall be set forth on
Schedule 1, which the Manager shall revise from time to time to reflect any
change of address specified by a Member by notice to the Company.

3. Capital Contributions, Admission of Additional Members.

3.1 Initial Capital Contributions. Each Member has made the Capital
Contribution, and shall have the Percentage Interest as set forth opposite that
Member’s name on Schedule 1.

3.2 Contributions of Securities. Except for the Initial Capital Contribution of
the Contributed UTEK Shares to be made by UTEK pursuant to section 3.1, which
for Capital Account purposes the parties agree has a fair market value of
$1,000,000 (the “Initial Value”) based on the valuation method set forth on
Schedule 1, if the Manager allows any Capital Contribution under this Article 3
to be made by the contribution of securities, the Manager shall determine the
fair market value of those securities for purposes of establishing the
contributor’s Capital Account. In determining the value, the Manager may reduce
that value to account for brokerage commissions that shall be incurred by the
Company when such securities are sold. The Company shall be under no obligation
to hold the securities contributed to it. Each Member contributing securities to
the capital of the Company hereby represents and warrants to the Company and the
other Members that such Member is the sole and absolute owner of the securities
so contributed, subject only to the holding of such securities of record in
“street” or nominee name for the sole and exclusive benefit of such Member, that
such securities have not been pledged, hypothecated or otherwise encumbered and
that the Company shall receive on consummation of such contribution good and
marketable title to such securities, free of all liens, claims, security
interests, community property rights, restrictions on Transfer and other
restrictions or defects in title.

3.3 Additional Capital Contributions. No Member shall be required to make any
additional Capital Contribution. To the extent approved by the Manager, the
Members may be permitted from time to time to make additional Capital
Contributions in aggregate amounts and on terms and conditions deemed
appropriate by the Manager. In such cases, the Manager

 

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shall amend Schedule 1 and cause appropriate adjustments to be made to the
Members’ Percentage Interests for purposes of applying the allocation and
distribution provisions of Article 7 of this Agreement.

3.4 Admission of Additional Members. The Manager may admit any Person to the
Company as a Member on the first day of any month (or any other day in the sole
and absolute discretion of the Manager) following the requisite period of time
following such person’s first date of complete documentation for such
admittance, and any such Person shall make such Capital Contribution and have
such Percentage Interest as the Manager may approve on behalf of the Company.
Notwithstanding the foregoing, the Manager shall not admit additional Members
with an aggregate amount of capital contributions in excess of Five Hundred
Thousand Dollars ($500,000) without the consent of a Super Majority in Interest
of the Members (which Super Majority in Interest must include the affirmative
vote of UTEK). No Person shall be admitted to the Company as a Member unless and
until such Person shall have agreed in writing (by signing a counterpart of this
Agreement, or otherwise, as the Manager may approve) to become a party to this
Agreement and to assume and perform all of the obligations and responsibilities
of a Member hereunder and shall have paid or delivered to the Company such
Person’s agreed Capital Contribution. Unless provided for elsewhere in this
Agreement, such admission of Members shall not require any consent or approval
of any Member other than the Manager. On the admission of any new Member, the
Manager shall amend Schedule 1 and cause appropriate adjustments to be made to
the Members’ Percentage Interests for purposes of applying the allocation and
distribution provisions of Article 7 of this Agreement, which adjustments shall
be made pro rata among the Members in proportion to their then Percentage
Interests.

3.5 Capital Accounts. The Company shall establish and maintain an individual
Capital Account for each Member in accordance with section 1.7 and Treasury
Regulations Section 1.704-1(b).

3.6 No Interest. No Member shall be entitled to receive any interest on such
Member’s Capital Contributions or the amount of such Member’s Capital Account.

3.7 Loans. The Manager or any Member may from time to time (but shall not be
obligated to) loan to the Company such additional sums as may be determined by
the Manager in its sole and absolute discretion to be necessary or desirable for
the operation of the Company. Any amounts so loaned by the Manager or a Member
shall be treated as a loan to the Company, shall be represented by promissory
notes executed by the Company, shall bear interest at LIBOR rate (as hereafter
defined), and shall have such other terms as shall be determined by the Manager
in its sole and absolute discretion. Said loans together with interest thereon
shall be repaid prior to any distributions of cash to the Members pursuant to
sections 7.5.2 and 11.4.4. The interest thereon shall be treated as a guaranteed
payment for purposes of Code Section 707. No Member shall be personally
obligated to repay any such loans. For purposes of this Agreement, “LIBOR” shall
mean the six (6) month London Interbank Offered Rate (LIBOR) as published in the
“Money Rates” column of The Wall Street Journal on the date of said loan. If The
Wall Street Journal publishes a retraction or correction of the LIBOR for the
date of said loan, then the term “LIBOR” shall mean the LIBOR reported in such
retraction or correction.

 

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4. Members.

4.1 Limited Liability. Except as required under the Act and as expressly
provided in this Agreement, the debts, duties, obligations and liabilities of
the Company, whether arising in contract, tort or otherwise, shall be solely the
debts, duties, obligations and liabilities of the Company, and no Member,
Manager or officer of the Company shall be personally liable for any debt, duty,
obligation or liability of the Company solely by reason of being a Member,
Manager or officer of the Company.

4.2 Meetings of Members. No regular, annual, special or other meetings of
Members are required to be held. If held, (a) any such meeting shall be held at
the Company’s principal executive office or at any other place selected by the
Manager and set forth in the notice of meeting, (b) a meeting shall be held only
when called by the Manager, and (c) the attendance of the Manager and a Majority
in Interest of the Members represented in person or by proxy shall be necessary
to constitute a quorum at any meeting to consider a matter on which Members may
take action. Any action that may be taken at a meeting of Members may be taken
without a meeting by written consent as provided in Section 18-302 of the Act.

4.3 Members Have No Managerial Authority. The Members, as such, shall have no
power to participate in the management of the Company except as expressly
authorized by this Agreement and except as expressly required by the Act
notwithstanding this Agreement. Unless expressly and duly authorized in writing
to do so by the Manager, no Member, as such, shall have any power or authority
to sign for, bind or act on behalf of the Company in any way, to pledge the
Company’s credit, or to render the Company liable for any purpose; provided,
however, that if any Member is also an officer or employee of the Company that
Member may act on behalf of the Company in any manner consistent with the
authority granted by the Manager to that Member as such an officer or employee.

4.4 Voting Rights. Except as expressly provided in this Agreement or the
Certificate, Members shall have no voting, approval or consent rights.

4.5 Other Activities. Any Member and such Member’s Affiliates may engage in any
activities, whether or not related to the business of the Company, or make
independent investments, the Members specifically recognizing that some or all
of them and their Affiliates are engaged in various businesses, both for their
own accounts and for others, and such Members may continue, or initiate further,
such activities. Each Member agrees that any Member and any Affiliate of such
Member (a) may engage in or possess an interest, direct or indirect, in any
business venture of any nature or description for his, her or its own account,
independently or with others, including, without limitation, any business,
industry or activity in which the Company may be interested in engaging or may
also be engaged and (b) may do so without any obligation to report the same to
the Company or any other Member or Manager or to afford the Company or any other
Member or Manager any opportunity to participate therein. Neither the Company
nor any Member or Manager shall have any right in or to any such independent
venture or activity or any revenues or profits derived therefrom.

4.6 Waiver of Conflicts. Subject to any express prohibition in this Agreement,
the fact that any Member or Manager, or any Affiliate of any Member or Manager,
or a member

 

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of his or her family, is employed by, or is directly or indirectly interested in
or connected with, any Person employed or engaged by the Company to render or
perform a service, or from whom the Company may make any purchase, or to whom
the Company may make any sale, or from or to whom the Company may obtain or make
any loan or enter into any lease or other arrangement, shall not prohibit the
Company from engaging in any transaction with such Member, Manager or Person or
create any additional duty of legal justification by such Member, Manager or
Person, beyond that of an unrelated party. Neither the Company nor any other
Member or Manager shall have any right in or to any revenues or profits derived
from such transaction by such Member, Manager, Affiliate or Person.

4.7 Nature of Members’ Liabilities for Claims Against the Company. In
furtherance of the intent of the parties that each Member shall be liable to
creditors only to the extent of such Member’s Capital Contributions and
undistributed profits, the Manager shall arrange to prosecute, defend, settle or
compromise actions at law or in equity at the expense of the Company as the
Manager may consider necessary to enforce or protect the interests of the
Company, and the Manager shall cause the Company to satisfy any judgment,
decree, decision or settlement under the terms of which the Company (or a
Manager, or any Affiliate of a Manager, on behalf of the Company) is obligated
to pay any amount, first, out of available proceeds of any insurance of which
the Company is the beneficiary, and next, out of Company assets and income;
provided that no such payment shall be made out of the assets or income of a
Manager or any officer of the Company, and the Company shall indemnify and
defend the Manager and the Company’s officers and hold them harmless therefrom.

4.8 Costs of Special Services. Any costs incurred in connection with special
services requested by a Member will be required to be paid by that Member. Such
services would include, for example, those that would benefit the Member but
would not benefit the Company, such as a special evaluation or financial
accounting for the purposes of estate valuation, or legal fees relating to the
assignment or Transfer of an interest of the Company.

4.9 No Right to Withdraw. No Member may withdraw his, her or its Capital
Contribution from the Company prior to the dissolution and winding up of the
Company. No Member shall have the right to withdraw, retire or resign from the
Company prior to the dissolution and winding up of the Company. The provisions
hereof with respect to distributions upon withdrawal, resignation or retirement
are exclusive and no Member shall be entitled to claim any further or different
distribution upon withdrawal under Section 18-604 of the Delaware Act or
otherwise.

4.10 UTEK Limited Right to Withdraw.

4.10.1 Notwithstanding the provisions of Section 4.9, if, on the first
anniversary (the “First Anniversary Date”) of the date (the “UTEK Contribution
Date”) that UTEK made its capital contribution of the Contributed UTEK Shares
pursuant to Section 3.1, the Company has not identified and funded at least one
Investment (as hereafter defined) in a UTEK Business Enterprise (as hereafter
defined), UTEK shall have the right to withdraw from the Company pursuant to
this Section 4.10.1. Within thirty (30) days after the First Anniversary Date,
UTEK shall give written notice to the Manager of its intention to withdraw from
the Company pursuant to this Section 4.10.1. Within five (5) business days after
the receipt of such

 

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notice, the Company shall distribute to UTEK two-thirds ( 2/3) of the total
number of Contributed UTEK Shares in exchange for UTEK’s entire membership
interest in the Company; provided, however, that (i) UTEK shall retain its right
to participate in any distributions, profits and losses pursuant to sections
7.2.2(b) and 7.2.4(b) of this Agreement (the “Retained Participation Right”)
with respect to investments made by the Company prior to the First Anniversary
Date, and (ii) UTEK shall retain its right to receive distributions pursuant to
section 7.2.2(a) and 7.2.4(a), but only up to the Initial Value of the
Contributed UTEK Shares that were not withdrawn by UTEK pursuant to this section
4.10.1 (the “Retained Right to Distributions”). Upon its receipt of two-thirds
( 2/3) of the total number of Contributed UTEK Shares, and except for the
Retained Participation Right and the Retained Right to Distributions set forth
in the preceding sentence, UTEK shall cease to be a Member of the Company and
shall not be entitled to claim any further or different distribution upon its
withdrawal under Section 18-604 of the Delaware Act or otherwise. UTEK shall
execute and deliver such documents, including documents of assignment, as the
Manager may deem necessary in order to effectuate UTEK’s complete withdrawal
from the Company pursuant to this Section 4.10.1.

For purposes of this Section 4.10, the term “Investment” shall mean any type of
funding from any source, including without limitation government grants, equity
financing or debt financing (whether by direct investment or through an
Investment Partnership, and regardless of whether the Company invests any of its
own capital). The term “UTEK Business Enterprise” shall mean any business
enterprise that directly or indirectly utilizes the involvement of UTEK or its
Affiliates, which may include, without limitation, any of the following: online
platforms, partnering, sourcing of technology and technology transfer services;
identification of investment opportunity; strategic services including global
licensing and negotiation of licensing agreements; intellectual property
analytics; strategic consulting including technology review by UTEK’s scientific
advisors; insights and research including foresight and trend analysis, research
and information services. No less than              (    ) business days prior
to the closing of each Investment in a business enterprise, UTEK shall deliver
in writing to the Manager a statement as to whether UTEK considers such business
enterprise to constitute a UTEK Business Enterprise.

4.10.2 Notwithstanding the provisions of Section 4.9, if on the second
anniversary (the “Second Anniversary Date”) of the UTEK Contribution Date, the
Company has not identified and funded at least two Investments in UTEK Business
Enterprises, UTEK shall have the right to withdraw from the Company pursuant to
this Section 4.10.2. Within thirty (30) days after the Second Anniversary Date,
UTEK shall give written notice to the Manager of its intention to withdraw from
the Company pursuant to this Section 4.10.2. Within five (5) business days after
the receipt of such notice, the Company shall distribute to UTEK one-third
( 1/3) of the total number of Contributed UTEK Shares in exchange for UTEK’s
entire membership interest in the Company; provided, however, that (i) UTEK
shall have a Retained Participation Right with respect to investments made by
the Company prior to the Second Anniversary Date, and (ii) UTEK shall have a
Retained Right to Distributions, but only up to the Initial Value of the
Contributed UTEK Shares that were not withdrawn by UTEK pursuant to this
Section 4.10.2. Upon its receipt of one-third ( 1/3) of the total number of
Contributed UTEK Shares, and except for the Retained Participation Right and the
Retained Right to Distributions set forth in the preceding sentence, UTEK shall
cease to be a Member of the Company and shall not be entitled to claim any
further or different distribution upon its withdrawal under Section 18-604 of
the Delaware Act or otherwise. UTEK shall execute and deliver such documents,
including documents of assignment, as the Manager may deem necessary in order to
effectuate UTEK’s complete withdrawal from the Company pursuant to this
Section 4.10.2.

 

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4.10.3 Notwithstanding the provisions of Section 4.9, if on the third
anniversary (the “Third Anniversary Date”) of the UTEK Contribution Date, the
Company has not identified and funded at least three Investments in UTEK
Business Enterprises, UTEK shall have the right to withdraw from the Company
pursuant to this Section 4.10.3. Within five (5) business days after the receipt
of such notice, the Company shall distribute to UTEK any unsold Contributed UTEK
Shares in exchange for UTEK’s entire membership interest in the Company;
provided, however, that (i) UTEK shall have a Retained Participation Right with
respect to investments made by the Company prior to the Third Anniversary Date,
and (ii) UTEK shall have a Retained Right to Distributions, but only up to the
Initial Value of the Contributed UTEK Shares that were not withdrawn by UTEK
pursuant to this Section 4.10.3. Upon its receipt of the unsold Contributed UTEK
Shares, and except for the Retained Participation Right and the Retained Right
to Distributions set forth in the preceding sentence, UTEK shall cease to be a
Member of the Company and shall not be entitled to claim any further or
different distribution upon its withdrawal under Section 18-604 of the Delaware
Act or otherwise. UTEK shall execute and deliver such documents, including
documents of assignment, as the Manager may deem necessary in order to
effectuate UTEK’s complete withdrawal from the Company pursuant to this
Section 4.10.2.

5. Investment Partnerships and Co-Investment Rights.

5.1 Investment Partnerships.

5.1.1 From time to time the Manager shall form one or more Investment
Partnerships. Each Investment Partnership may be either a Single Purpose
Investment Partnership or a Master Investment Partnership. A Single Purpose
Investment Partnership is a limited partnership, limited liability company,
corporation or other legal entity formed for the purpose of investing in,
acquiring and/or establishing one specific business enterprise. A Master
Investment Partnership is a limited partnership, limited liability company,
corporation or other legal entity formed for the purpose of serving as a venture
capital fund to invest in, acquire and/or establish more than one business
enterprise.

5.1.2 The Manager shall use its reasonable efforts to form each Investment
Partnership on substantially the terms set forth on Exhibit A hereto.

5.1.3 The Company shall act as the general partner, manager or similar agent of
each Investment Partnership and will have an obligation to contribute capital to
each Investment Partnership in an amount equal to at least two-tenths of one
percent (0.2%) of the capital to be contributed by all partners, members or
similar interest-holders of such Investment Partnership.

5.1.4 In addition to its interest as the general partner, manager or similar
agent of an Investment Partnership, the Company also may, but shall not be
required to, purchase a limited partner interest in such Investment Partnership
by making an additional capital contribution to such Investment Partnership. The
decision whether to purchase a limited partner interest in an Investment
Partnership and the amount of the capital contribution to be made in exchange
therefore shall be made by the Manager in its sole discretion.

 

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5.2 Co-Investment Rights.

5.2.1 On each occasion that the Manager proposes to form an Investment
Partnership (regardless of whether the Investment Partnership is a Single
Purpose Investment Partnership or a Master Investment Partnership), the Manager
shall deliver a notice (the “Investment Opportunity Notice”) to each Member,
describing the proposed Investment Partnership in reasonable detail, including
without limitation the total dollar amount of capital to be raised by such
Investment Partnership and, if the Investment Partnership is a Single Purpose
Investment Partnership, a description of the proposed investment to be made by
the Investment Partnership. Each Member receiving such Investment Opportunity
Notice shall have ten (10) business days to affirmatively respond to such
Investment Opportunity Notice by delivering to the Manager a written notice
stating the Member’s election to invest as a limited partner in the proposed
Investment Partnership and the amount of capital such Member elects to commit
with respect to such Investment Partnership. No Member may participate in an
Investment Partnership in any amount unless such Member affirms in writing as
part of its response to an Investment Opportunity Notice the continued accuracy
of the representation set forth in section 14.3.

5.2.2 If the aggregate amounts committed to the proposed Investment Partnership
by Members affirmatively responding to such Investment Opportunity Notice (each
a “Participating Member”) exceeds the total dollar amount of capital to be
raised by the proposed Investment Partnership, then the Manager shall use its
good faith judgment to reduce the commitments of all Participating Members to
the proposed Investment Partnership in relation to the Capital Contribution
(including additional Capital Contributions) of each such Participating Member
to the Company. If the aggregate amounts committed to the proposed Investment
Partnership by the Participating Members is less than the total dollar amount of
capital to be raised by the proposed Investment Partnership, then the Manager
may solicit additional commitments to invest in the proposed Investment
Partnership from third parties, or from the Manager, in an aggregate amount not
to exceed the excess of the total dollar amount of capital to be raised by the
proposed Investment Partnership over the aggregate commitments of all
Participating Members to the proposed Investment Partnership. Notwithstanding
the preceding two sentences, the Manager may allocate up to twenty percent
(20%) of the capital to be committed to a proposed Investment Partnership to any
Finders who rendered services with respect to such proposed Investment
Partnership or the proposed investment to be made by such proposed Investment
Partnership.

5.2.3 The Manager shall send a second notice (the “Contribution Notice”) to each
Participating Member for the proposed Investment Partnership informing such
Participating Member of such Participating Member’s participation amount with
respect to the proposed Investment Partnership (the “Participation Amount”) and
describing the aggregate commitments of the Participating Members to the
proposed Investment Partnership and any additional commitments of the Manager or
third parties to the proposed Investment Partnership, after which such
Participating Member shall then have five (5) business days (or such longer
period as the Manager may determine in its discretion) to fund its Participation
Amount for the

 

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proposed Investment Partnership, which amount shall be paid directly to the
Investment Partnership and shall not be treated as a capital contribution to the
Company. The Contribution Notice shall also set forth any material deviations
from the terms set forth on Exhibit A in the formation of the Investment
Partnership.

5.2.4 Each Member hereby agrees to become a limited partner, member, or similar
interest-holder in each Investment Partnership with respect to an investment
opportunity for which such Member is a Participating Member and hereby appoints
the Manager as such Member’s attorney-in-fact for the purpose of executing any
documents necessary to admit the Member to such Investment Partnership.

5.2.5 In addition to such Member’s rights to profits and distributions pursuant
to Article 7 of this Agreement, each Member who purchases a limited partner
interest in an Investment Partnership shall participate pro rata with the other
limited partners in the profits and distributions of such Investment Partnership
in accordance with the provisions of the partnership agreement, limited
liability company agreement or other applicable agreement of the Investment
Partnership.

5.3 Follow-On Investment Opportunities. Notwithstanding anything to the contrary
contained in this Article 5, in the event that the proposed investment to be
made by a proposed Special Purpose Investment Partnership relates to an
investment in a legal entity whose Securities have been previously acquired by
an existing Investment Partnership, participation in such proposed Special
Purpose Investment Partnership shall first be offered to the Participating
Members of such existing Investment Partnership (under substantially identical
procedures as outlined in section 5.2). If such Participating Members do not
elect to participate in the entire amount of capital to be raised by such
proposed Special Purpose Investment Partnership, then the remaining available
amount of capital to be raised by such proposed Special Purpose Investment
Partnership (the “Unsubscribed New Capital”) shall be treated as a new
“Investment Partnership” and the Members shall have the right to co-invest in
such Unsubscribed New Capital pursuant to the procedure set forth in
Section 5.2.

6. Management and Control of the Company.

6.1 Management of the Company by Manager.

6.1.1 Subject to provisions of this Agreement relating to actions required to be
approved by Members, the business, property and affairs of the Company shall be
managed, and all powers of the Company shall be exercised by or under the
direction of, the Manager.

6.1.2 Subject to section 6.3.2, the Manager is authorized to endorse checks,
drafts, and other evidences of indebtedness made payable to the order of the
Company, to sign all checks, drafts and other instruments obligating the Company
to pay money, to sign contracts and obligations on behalf of the Company and to
delegate any such authority to any Person, as the Manager considers advisable.

6.1.3 Subject to compliance with federal and state securities laws, the Manager
is authorized to sell the Contributed UTEK Shares as follows: (i) up to
one-third ( 1/3) of

 

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the total number of Contributed UTEK Shares may be sold at any time or times
during the twelve (12) month period commencing with the UTEK Contribution Date
or at any time thereafter; (ii) up to an additional one-third ( 1/3) of the
total number of Contributed UTEK Shares may be sold at any time or times during
the twelve (12) month period commencing with the first anniversary of the UTEK
Contribution Date or at any time thereafter; and (iii) up to an additional
one-third ( 1/3) of the total number of Contributed UTEK Shares may be sold at
any time or times after the second anniversary of the UTEK Contribution Date.
The Manager may use the proceeds from any such sale to pay expenses of the
Company (including without limitation the Management Fee, Management Expense
Reimbursement and Company Expenses) and/or to make investments on behalf of the
Company in one or more Investment Partnerships pursuant to Section 5. At any
time or from time to time the Manager may seek a waiver from UTEK of the
foregoing limitations on the Manager’s authority to sell the Contributed UTEK
Shares, which waiver shall not be unreasonably withheld by UTEK.

6.2 Designation of Manager.

6.2.1 Number, Term, and Qualifications. The Company shall have one Manager, who
shall be Managers LLC. Unless a Dissolution Event occurs with respect to
Managers LLC, Managers LLC shall hold office until it resigns pursuant to
section 6.2.2 or is removed pursuant to section 6.2.3 and a successor shall have
been elected and shall qualify. Notwithstanding the foregoing, if at any time
John Micek is no longer a manager of Managers LLC, then UTEK shall have the
right to approve the successor manager of Managers LLC, which approval shall not
be unreasonably withheld. The Manager shall be a Member, but need not be a
natural person, a resident of the State of Delaware, or a citizen of the United
States. Each Manager shall sign this Agreement or a counterpart hereof.

6.2.2 Resignation. The Manager may resign as such at any time by giving notice
to the Members, without prejudice to the rights, if any, of the Company under
any contract to which the resigning Manager is a party. The resignation of the
Manager shall take effect on receipt of the notice or at such later time as
shall be specified in the notice, and, unless otherwise specified in the notice,
acceptance of the resignation shall not be necessary to make it effective. If
John Micek is no longer a manager of Managers LLC, and UTEK does not approve the
successor manager of Managers LLC, then Managers LLC shall be deemed to have
resigned as Manager as of the date that UTEK disapproves said successor manager.
The resignation of the Manager shall not affect that Manager’s rights or
obligations as a Member and shall not constitute that Manager’s withdrawal as a
Member. The Manager shall be deemed to have resigned as such on the happening of
a Dissolution Event with respect to such Manager.

6.2.3 Removal. The Manager may be removed for Cause by the Members by vote of a
Super Majority in Interest of the Members. For purposes hereof, in determining a
Super Majority in Interest of the Members, the Manager who is the subject of the
removal vote shall be entitled to vote any interest held by it as a member, and
the vote of such interest shall be included in the determination of the vote of
a Super Majority in Interest of the Members with respect to the Manager’s
removal.

6.2.4 Successor Manager. The Manager shall have the right at any time to appoint
a successor Manager to succeed it as Manager, provided that said appointment

 

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shall be subject to the approval of UTEK, which approval shall not be
unreasonably withheld (a successor Manager so appointed and approved is
hereafter referred to as a “Designated Successor Manager”). If the Manager
resigns or is removed and there is no Designated Successor Manager, then a
successor Manager shall be elected by a Majority in Interest of the Members,
subject to the approval of UTEK, which approval shall not be unreasonably
withheld (a successor Manager so elected and approved is hereafter referred to
as a “Elected Successor Manager”). A Designated Successor Manager or an Elected
Successor Manager, as applicable, shall become the Manager of the Company upon
the resignation or removal of the Manager pursuant to section 6.2.2 or section
6.2.3, respectively; provided, however that prior to such Person becoming the
Manager, such Person shall have executed an Agreement of Successor Manager in
the form of Schedule 3 attached hereto, whereby such Person accepts the position
of Manager and agrees to be bound by all of the terms and conditions of this
Agreement. In addition, upon said designation or election as Designated
Successor Manager or Elected Successor Manager, as the case may be, such Person
shall be admitted as a Member; provided, however, that prior to such Person
becoming a Member, such Person shall have executed a counterpart of this
Agreement as a Member.

6.3 Powers of Manager.

6.3.1 Overall Powers of Manager. Without limiting the generality of, but subject
to sections 6.1 and 6.3.2 and to the express limitations set forth elsewhere in
this Agreement, the Manager shall have all necessary power and authority to
manage and carry out the purposes, business, property, and affairs of the
Company. Any and all rights, powers, authority and discretion of the Manager
under this Agreement or the Act shall be exercisable by the Manager in its
absolute and exclusive discretion, and the Manager is authorized and empowered
to grant or give any consent, approval or authorization, make any determination
or do or perform any other act or thing conditionally or unconditionally,
arbitrarily, or inconsistently in varying or similar circumstances, without any
accountability to the Company or any other Member, except only as otherwise
specifically and expressly provided in this Agreement or provided by the Act
notwithstanding this Agreement.

6.3.2 Limitations. Notwithstanding any other provision of this Agreement, the
Manager shall not, without the consent of a Super Majority in Interest of the
Members (which Super Majority in Interest of the Members must include the
affirmative vote of UTEK), have authority hereunder to cause the Company to
engage in any of the following transactions:

(a) the sale or other disposition of all or substantially all of the Company’s
assets;

(b) the merger of the Company with another limited liability company,, limited
partnership, corporation or general partnership; provided that in no event shall
a Member or Manager be required to become a general partner in a merger with a
general or limited partnership without that Member’s or Manager’s express
consent; or

(c) the dissolution of the Company.

 

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6.4 Performance of Duties; Liability of Manager. The Manager shall not be liable
to the Company or to any Member for any loss, liability, claim or damage
sustained by the Company or any Member, unless the loss, liability, claim or
damage shall have been the result of fraud, deceit, gross negligence or willful
misconduct by the Manager.

6.5 Devotion of Time. The Manager is not obligated to devote all of its time or
business efforts to the affairs of the Company. The Manager shall devote to the
business and affairs of the Company such time, effort and skill as it deems
appropriate.

6.6 Competing Activities. Each Manager and the Manager’s agents, employees,
officers, directors, managers, shareholders, members and Affiliates may engage
or invest in, independently or with others, any business activity of any type or
description, including, without limitation, those that might be the same as or
similar to the Company’s business and that might be in direct or indirect
competition with the Company. Neither the Company nor any Member shall have any
right in or to such other ventures or activities or to the income or proceeds
derived therefrom. No Manager shall be obligated to present any investment
opportunity or prospective economic advantage to the Company, even if the
opportunity is of the character that, if presented to the Company, could be
taken by the Company. The Manager shall have the right to hold any investment
opportunity or prospective economic advantage for the Manager’s own account and
to recommend such opportunity to Persons other than the Company. The Members
acknowledge that the Manager and its agents, employees, officers, directors,
shareholders and Affiliates may own or manage other businesses, including
businesses to which the Manager devotes time and attention that may compete with
the Company and for the Manager’s time.

6.7 Transactions between the Company and the Manager. Notwithstanding that it
may constitute a conflict of interest, the Manager may, and may cause the
Manager’s Affiliates to, engage in any transaction (including, without
limitation, the purchase, sale, lease or exchange of any property or the
rendering of any service, or the establishment of any salary or other
compensation or other terms of employment) with the Company, so long as such
transaction is not expressly prohibited by this Agreement, and so long as the
terms and conditions of such transaction, on an overall basis, are fair and
reasonable to the Company and are at least as favorable to the Company as those
that are generally available in similar transactions between parties dealing at
arm’s length. A transaction between the Manager or any of the Manager’s
Affiliates, on the one hand, and the Company, on the other hand, shall be
conclusively presumed to be on terms and conditions, on an overall basis, fair
and reasonable to the Company and at least as favorable to the Company as those
that are generally available in a similar transaction between parties dealing at
arm’s length, if a Majority in Interest of the Members having no interest in
such transaction (other than their interests as Members) approve the
transaction.

6.8 Management Fee. The Manager shall be entitled to a management fee (the
“Management Fee”) for each Fiscal Year in an amount equal to the greater of
(i) $250,000, or (ii) two percent (2%) of the aggregate Capital Contributions to
the Investment Partnerships managed by the Company as of the first day of such
Fiscal Year. The Company shall pay the Manager, quarterly in advance on the
first day of each Fiscal Quarter, one-quarter of the annual Management Fee.

 

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6.9 Expenses.

6.9.1 Management Expense Reimbursement. In addition to the Management Fee, the
Company shall reimburse the Manager up to $3,300 per month for the Manager’s
operating expenses (“Management Expense Reimbursement”) including without
limitation office rent, telephone and internet service, web site fees, outside
consultant fees and offsite storage fees. Notwithstanding the foregoing, the
maximum amount of the Management Expense Reimbursement shall be reduced dollar
for dollar by the amount, if any, that the Management Fee paid to the Manager
for that Fiscal Year exceeds $250,000. For example, if the Management Fee for
the Fiscal Year 2010 is $260,000, then the maximum amount of the Management
Expense Reimbursement for Fiscal Year 2010 would be reduced by $10,000 from
$39,600 to $29,600, and if the Management Fee for the Fiscal Year 2011 is
$300,000, then the maximum amount of the Management Expense Reimbursement for
Fiscal Year 2011 would be reduced by $39,600 from $39,600 to 0.

6.9.2 Company Expenses. The Manager shall pay the expenses incurred in the
formation and organization of the Company, including, without limitation, the
preparation of the Certificate and this Agreement by counsel for the Manager.
Except for the foregoing, the Company shall pay all Company expenses incurred by
the Manager directly in connection with the conduct of the Company’s business,
including legal and accounting fees, brokerage commissions, finders fees, and
any costs or expenses incurred directly in connection with a transaction or
proposed transaction (including due diligence costs), whether or not
consummated.

6.10 Officers. The Manager may appoint one or more officers at any time. The
officers of the Company, if deemed necessary by the Manager, may include a
president (or a chairman), one or more vice presidents, a secretary, one or more
assistant secretaries, a chief operating officer, a chief financial officer, one
or more deputy chief financial officers, and such other officers as the Manager
may designate. The officers, if any, shall serve at the pleasure of the Manager,
subject to all rights, if any, of an officer under any contract of employment.
Any natural person, including a Member or a Manager or any Affiliate of a
Manager, may hold any number of offices. An officer need not be a Member, a
resident of the State of Delaware or a citizen of the United States. The
officers shall exercise such powers and perform such duties as are specified in
this Agreement and as shall be determined from time to time by the Manager.
Generally, each officer shall have the powers, duties and responsibilities
usually vested in like titled officers of a Delaware corporation and shall
perform such other duties and have such other powers as the Manager may from
time to time prescribe.

6.11 Limited Liability. Except as required under the Act or as expressly set
forth in this Agreement, the debts, obligations and liabilities of the Company,
whether arising in contract, tort or otherwise, shall be solely the debts,
obligations and liabilities of the Company, and no Manager shall be personally
liable for any debt, obligation or liability of the Company solely by reason of
acting as a Manager of the Company.

6.12 Advisory Board. The Manager may select a number of Members or other persons
(whether affiliated or not affiliated with the Manager) to act as an advisory
board to consult with the Manager with respect to the business of the Company
and certain other matters

 

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as requested by the Manager in connection with the Company (the “Advisory
Board”). The Manager may not delegate any of its powers or duties to the
Advisory Board, and the Advisory Board shall have no authority, power or
discretion to manage or control the business and affairs of the Company, to make
any decisions, investments or take any actions on behalf of the Manager or the
Company. The Advisory Board shall have no power to bind the Company or the
Members.

6.13 Assignment of Participation Rights. The Manager may grant to any Advisory
Board member or other advisor or consultant as compensation for services
rendered to the Company a right to participate (a “Participation Right”) in a
percentage of the Manager’s share of cash derived from the Third Source with
respect to any one or more Investment Partnerships provided, however, that a
Participation Right shall not reduce the interest of any Member other than the
Manager in cash derived from the Third Source. A holder of a Participation Right
(i) shall be a mere assignee of a profits interest and not a Member, (ii) shall
have none of the rights of a Member under this Agreement and the Delaware Act
with respect to such Participation Right, and (iii) shall have no interest in
any assets of the Company as a result of such Participation Right. A holder of a
Participation Right shall have solely the right to participate in distributions
of cash derived from the Third Source with respect to one or more specific
Investment Partnerships pursuant to section 7.2.4. The Manager shall retain all
voting rights with respect to its membership interest notwithstanding any grants
of Participation Rights. For each Fiscal Year beginning with the date the
Participation Right is granted and ending with the disposition by the Company of
its carried interest in the Investment Partnership with respect to which the
Participation Right was granted, the Manager’s share of Profits and Losses from
the Third Source with respect to such Investment Partnership shall be allocated
between the Manager and the holder of such Participation Right in proportion to
their interests therein.

7. Allocations and Distributions.

7.1 Allocations. Except as otherwise provided in Appendix B, Profits and Losses
(or any items thereof) shall be allocated annually (and at such other times as
the Manager determines) to the Members in such a manner that the Capital Account
of each Member, plus the Member’s share of Company Minimum Gain and Member
Minimum Gain, shall, to the extent possible, be equal to the amount, positive or
negative, which would be distributed to such Member (in the case of a positive
amount) or for which such member would be liable to the Company under this
Agreement (in the case of a negative amount), if (a) the Company were to sell
the assets of the Company for an amount equal to their then Book Value, (b) the
Company were to satisfy all of its liabilities and distribute the remaining
proceeds of sale pursuant to section 7.2, and (c) the Company were to dissolve
pursuant to Article 11; provided, however, that Losses (or any items thereof)
shall not be allocated to a Member to the extent such allocation would cause
such Member to have an Adjusted Capital Account Deficit at the end of any Fiscal
Year.

7.2 Distributions. There shall be five sources of cash available for
distribution to the Members: (i) cash derived from the investment of the capital
of the Company (the “First Source”); (ii) cash derived from Fee Income (the
“Second Source”); (iii) cash derived from the Company’s “carried interests” in
the Investment Partnerships that it manages (the “Third Source”); (iv) cash
derived from the sale of all or a substantial portion of the assets of the

 

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Company (other than cash from any such sale that is allocated or attributable to
the Company’s assets which produce income from the First Source or the Third
Source) outside of the ordinary course of its business (the “Fourth Source”);
and (v) other sources of cash.

7.2.1 Subject to applicable law and any limitations elsewhere in this Agreement
(including, without limitation, section 7.3), the Manager shall determine the
source, amount, proportion and timing of all distributions by the Company and
whether such distributions will be in cash or in kind or partly in cash and
partly in kind. All such distributions shall be made only to the Persons who,
according to the books and records of the Company, are the holders of record of
the Economic Interests in respect of which such distributions are made on the
date of distribution.

7.2.2 All distributions of cash derived from the First Source, Fourth Source and
Other Sources shall be made to the Members as follows:

(a) First, to the Members, pro rata in proportion to their Capital
Contributions, until each Member has been distributed a cumulative amount of
cash pursuant to this section 7.2.2(a) and section 7.2.4(a) equal to its Capital
Contribution;

(b) Thereafter, all such distributions shall be made to the Members in
proportion to their Percentage Interests.

7.2.3 All distributions of cash derived from the Second Source shall be made
100% to the Manager.

7.2.4 All distributions of cash derived from the Third Source shall be made to
the Members as follows:

(a) First, 33 1/3 to Managers LLC and 66 2/3 to the Members, pro rata in
proportion to their Capital Contributions, until each Member (other than
Managers LLC) has been distributed a cumulative amount of cash pursuant to
section 7.2.2(a) and this section 7.2.4(a) equal to its Capital Contribution;

(b) Thereafter, all such distributions shall be made to the Members in
proportion to their Percentage Interests.

7.2.5 Subject to any restrictions contained in any agreements to which the
Company is a party (other than this Agreement), to the extent any Member’s
Aggregate Company Tax Liability exceeds the aggregate amounts distributed to
such Member in accordance with sections 7.2.2, 7.2.3, 7.2.4 and this section
7.2.5 since the inception of the Company (a “Tax Shortfall”), the Company shall
distribute cash to the Members at least once per Fiscal Year, pro rata in
accordance with their respective Tax Shortfalls, until each Member has received
a total amount of cash under sections 7.2.2, 7.2.3, 7.2.4 and this section 7.2.5
since the inception of the Company equal to its Aggregate Company Tax Liability.
Amounts distributed to a Member pursuant to this section 7.2.5 shall be treated
as an advance against such Member’s future distributions pursuant to sections
7.2.2, 7.2.3 and 7.2.4.

 

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7.3 Form of Distribution. A Member, regardless of the nature of the Member’s
Capital Contribution, has no right to demand and receive any distribution from
the Company in any form other than money. No Member may be compelled to accept
from the Company a distribution of any asset in kind in lieu of a proportionate
distribution of money being made to other Members except on the dissolution of
the Company as provided herein.

7.4 Withholding on Allocations and Distributions. Each Member acknowledges and
agrees that the Company may be required to deduct and withhold tax or to fulfill
other obligations of such Member on any allocation or distribution under this
Article 7. All amounts withheld with respect to any allocation or distribution
to a Member shall be treated as amounts distributed to such Member for all
purposes under this Agreement as of the effective date of the related
distribution.

7.5 Restriction on Distributions. No distribution shall be made if and to the
extent prohibited by the Act notwithstanding this Agreement.

7.6 Return of Distributions. Except for distributions made in violation of the
Act or this Agreement, no Member shall be obligated to return any distribution
to the Company or pay the amount of any distribution for the account of the
Company or to any creditor of the Company. The amount of any distribution
returned to the Company by a Member or paid by a Member for the account of the
Company or to a creditor of the Company shall be added to the account or
accounts from which it shall have been subtracted on its distribution to the
Member.

8. Transfer and Assignment of Interests.

8.1 Transfer and Assignment of Interests. Except for Participation Rights
granted by the Manager pursuant to section 6.13, no Member shall Transfer all or
any part of that Member’s Membership Interest except with the prior consent of
the Manager. In addition, the Manager shall not Transfer all or any part of such
Manager’s Membership Interest, if any, except with the prior consent of a Super
Majority in Interest of the other Members; provided, however, that a Manager may
Transfer its Membership Interest (including the right to act as Manager) to an
Affiliate of the Manager without the consent of any other Member. Any such
consent may be given, conditionally or unconditionally, or withheld (as
permitted by this Agreement or the Act), as the Manager or such Members may
determine in their exclusive discretion. Any attempted or purported Transfer in
violation of this Article 8 shall be void. After the consummation of any
Transfer of a Membership Interest, the Membership Interest so Transferred shall
continue to be subject to the terms and conditions of this Agreement, and any
further Transfers shall comply with all the terms and conditions of this
Agreement. If a Transfer occurs by operation of law (including, but not limited
to, on death, Bankruptcy or divorce of a Member), the transferee shall become an
Assignee entitled to an Economic Interest, but shall not be substituted as a
Member without the prior consent of the Manager.

8.2 Further Restrictions on Transfer of Interests. In addition to other
restrictions in this Agreement, no Member shall Transfer any Membership Interest
or any interest therein (a) without compliance with section 12 unless the
Manager consents, and (b) if the Membership Interest or interest to be
Transferred, when added to all other Membership Interests Transferred in the
preceding twelve months, would cause the termination of the Company under the
Code.

 

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8.3 Substitution of Members. A transferee of a Membership Interest shall have
the right to become a substitute Member only if (a) the requirements of sections
8.1 and 8.2 are met, (b) such transferee executes an instrument satisfactory to
the Manager accepting and adopting the terms and conditions of this Agreement
and (c) such transferee pays any reasonable expenses in connection with that
transferee’s admission as a new Member. The admission of a substitute Member
shall not result in the release from any liability of the Person who shall have
assigned the Membership Interest.

8.4 Effective Date of Permitted Transfers. Any permitted Transfer of all or any
portion of a Membership Interest shall be effective as of the last day of the
calendar month in which the requirements of sections 8.1, 8.2 and 8.3 shall have
been met. Any transferee of a Membership Interest shall take and hold such
Membership Interest subject to the restrictions on Transfer imposed by this
Agreement.

8.5 Rights of Legal Representatives. If a Member who is a natural person dies or
is adjudged by a court of competent jurisdiction to be incompetent to manage
such Member’s person or property, such Member’s executor, administrator,
guardian, conservator or other legal representative may exercise all of such
Member’s rights for the purpose of settling such Member’s estate or
administering such Member’s property, including any power such Member has under
the Certificate or this Agreement to give an Assignee the right to become a
Member. If a Member is a corporation, trust or other entity and is dissolved or
terminated, the powers of that Member may be exercised by its legal
representative or Successor.

8.6 No Effect to Transfers in Violation of Agreement. On any Transfer of a
Membership Interest in violation of this Article 8, neither the former Member
nor any Successor shall have the right to vote or participate in the management
of the business, property or affairs of the Company or to exercise any rights of
a Member. Such Successor shall only be entitled to become an Assignee of the
Economic Interest included in such Membership Interest and assigned to such
Successor, and thereafter shall only receive the share of the Company’s Profits,
Losses and distributions of the Company’s assets to which the Transferor of such
Economic Interest would otherwise have been entitled, which shall be effective
as of the last day of the calendar month in which the Transfer is made.

9. Spousal Consents. Any natural person to whose benefit this Agreement may now
or hereafter inure shall use his or her best efforts to obtain the
acknowledgement and consent of his or her spouse, whether such party is now
married or marries or remarries hereafter, in the attached hereto as Schedule 2.

10. Accounting, Records, Reporting by Members.

10.1 Books and Records. The Company shall maintain at its principal office all
of the following:

10.1.1 True and full information regarding the status of the business and
financial condition of the Company;

 

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10.1.2 Promptly after becoming available, a copy of the Company’s federal, state
and local income tax returns for each Fiscal Year;

10.1.3 A current list of the name and last known business, residence or mailing
address of each Member and Manager;

10.1.4 A copy of this Agreement and the Certificate and all amendments thereto,
together with executed copies of any written powers of attorney pursuant to
which this Agreement and the Certificate and all amendments thereto have been
executed; and

10.1.5 True and full information regarding the amount of cash and a description
and statement of the agreed value of any other property or services contributed
by each Member and which each Member has agreed to contribute in the future, and
the date on which each became a Member.

10.2 Delivery to Members and Manager and Inspection.

10.2.1 On the request of any Member, upon reasonable demand for any purpose
reasonably related to the Member’s interest as a Member, the Manager shall
promptly deliver to the requesting Member a copy of (i) the information required
to be maintained by section 10.1; and (ii) any other information regarding the
affairs of the Company as is just and reasonable.

10.2.2 The Manager shall have the right to examine all of the information
described in section 10.1 for a purpose reasonably related to its position as
the Manager.

10.2.3 Any demand by a Member under this section shall be in writing and shall
state the purpose of such demand.

10.2.4 The Manager shall have the right to keep confidential from the Members,
for such period of time as the Manager deems reasonable, any information which
the Manager reasonably believes to be in the nature of trade secrets or other
information the disclosure of which the Manager in good faith believes is not in
the best interest of the Company or could damage the Company or its business or
which the Company is required by law or by agreement with a third party to keep
confidential.

10.3 Accountings. As soon as is reasonably practicable after the close of each
Fiscal Year, the Manager shall make or cause to be made a full and accurate
accounting of the affairs of the Company as of the close of that Fiscal Year and
shall prepare or cause to be prepared a balance sheet as at the end of such
Fiscal Year, a profit and loss statement for that Fiscal Year and a statement of
Members’ equity showing the respective Capital Accounts of the Members as of the
close of such Fiscal Year and the distributions, if any, to Members during such
Fiscal Year, all of which the Manager shall furnish to each Member. In addition,
the Manager shall furnish to each Member information regarding the Company
necessary for such Member to complete such Member’s federal and state income tax
returns. The Manager shall also furnish a copy of the Company’s tax returns to
any Member requesting the same. On such accounting being made, Profits and
Losses during such Fiscal Year shall be ascertained and credited or debited, as
the case may be, in the books of account of the Company to the respective
Members as herein provided.

 

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10.4 Filings. The Manager, at Company expense, shall cause the income tax
returns for the Company to be prepared and timely filed with the appropriate
authorities. The Manager, at Company expense, shall also cause to be prepared
and timely filed with appropriate federal and state regulatory and
administrative bodies amendments to, or restatements of, the Certificate and all
reports required to be filed by the Company with those entities under the Act or
other then current applicable laws, rules, and regulations. If the Manager is
required by the Act to execute or file any document and fails, after demand, to
do so within a reasonable period of time or refuses to do so, any other Member
may prepare, execute and file that document with the Delaware Secretary of
State.

10.5 Bank and Brokerage Accounts. The Manager shall maintain the funds of the
Company in one or more separate bank or securities brokerage accounts in the
name of the Company, and shall not permit the funds of the Company to be
commingled in any fashion with the funds of any other Person.

10.6 Tax Matters Partner. The Manager may remove and replace the Tax Matters
Partner at any time or times. The Manager shall from time to time cause the
Company to make such tax elections as it deems to be in the interests of the
Company and the Members generally. The Tax Matters Partner, as defined in Code
section 6231, shall represent the Company (at the Company’s expense) in
connection with all examinations of the Company’s affairs by tax authorities,
including resulting judicial and administrative proceedings, and shall expend
the Company funds for professional services and costs associated therewith.

11. Dissolution and Winding Up.

11.1 Dissolution. The Company shall be dissolved, its assets shall be disposed
of, and its affairs wound up on the first to occur of:

11.1.1 The Manager’s election, by written notice to the Members, to dissolve the
Company, but only if a Super Majority in Interest of the Members has consented
to such election (which Super Majority in Interest must include UTEK) in
accordance with Section 6.3.2(b);

11.1.2 The entry of a decree of judicial dissolution pursuant to section 18-802
of the Act;

11.1.3 The vote or consent of a Super Majority in Interest of the Members,
provided that the Super Majority in Interest of the Members must include the
affirmative vote of UTEK; or

11.1.4 The sale or other disposition of all or substantially all of the
Company’s assets (provided that such sale or other disposition has been approved
by a Super Majority in Interest in the Members (which Super Majority in Interest
must include UTEK) pursuant to section 6.3.2(a)).

 

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11.2 Winding Up. On the occurrence of an event specified in section 11.1, the
Company shall continue solely for the purpose of winding up its affairs in an
orderly manner, liquidating its assets and satisfying the claims of its
creditors. The Manager or the Liquidating Person previously designated by the
Manager or by the consent of a Majority in Interest of the Members if there is
no remaining Manager (the “Liquidating Person”) shall be responsible for
overseeing the winding up and liquidation of the Company, shall take full
account of the assets and liabilities of Company, shall cause such assets to be
sold or distributed, and shall cause the proceeds therefrom, to the extent
sufficient therefor, to be applied and distributed as provided in section 11.4.
The Manager or the Liquidating Person shall give notice of the commencement of
winding up by mail to all known creditors and claimants whose addresses appear
on the records of the Company. The Manager or the Liquidating Person shall be
entitled to reasonable compensation for such services.

11.3 Distributions in Kind. Any non-cash assets distributed to the Members shall
first be valued at their fair market value to determine the Profit or Loss that
would have resulted if such assets were to have been sold for such value,
pursuant to Article 7, except that if there is no Manager, the valuation shall
be made by the Liquidating Person. Such Profit or Loss shall then be allocated
pursuant to Article 7, and the Members’ Capital Accounts shall be adjusted to
reflect such allocations. The amount distributed and charged against the Capital
Account of each Member receiving an interest in a distributed asset shall be the
fair market value of such interest (net of any liability secured by such asset
that such Member assumes or takes subject to).

11.4 Application of Proceeds. The proceeds from the liquidation of the assets of
the Company, together with assets to be distributed in kind, shall be applied
and distributed in the following order:

11.4.1 First, to pay the expenses of the liquidation;

11.4.2 Second, to pay or make adequate provision for the debts of the Company,
other than debts owing to any Member or the Manager;

11.4.3 Third, to repay all outstanding loans from any Member or the Manager.
Should there be insufficient funds to pay such loans in full, each member shall
be repaid in the ratio that its loan, together with interest accrued thereon,
bears to the total of all such loans from Members and the Manager, including all
interest accrued thereon; and

11.4.4 The balance, if any, shall be distributed to the Members in accordance
with section 7.2.

11.5 Compliance with Regulations. All payments to the Members on the winding up
and dissolution of Company shall be strictly in accordance with the positive
capital account balance limitation and other requirements of Regulations section
1.704-1(b)(2)(ii)(d).

11.6 Limitations on Payments. Except as otherwise specifically provided in this
Agreement, each Member shall look solely to the assets of Company for the return
of such Member’s positive Capital Account balance and shall have no recourse for
such Member’s Capital Contribution or share of Profits (on dissolution or
otherwise) against any other Member or the Manager.

 

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11.7 Certificate of Cancellation. The Manager or Members conducting the winding
up of the affairs of the Company shall cause to be filed in the office of, and
on a form prescribed by, the Delaware Secretary of State, a certificate of
cancellation of the Certificate on the completion of the winding up of the
affairs of the Company.

12. Indemnification and Insurance.

12.1 Indemnity and Limitation of Liability. Any Member, each Manager and any
Person acting on behalf of the Company (each an “Indemnified Person”), (a) shall
be held harmless, defended and indemnified by the Company from and against any
cost, claim, liability, loss, damage or expense (including, without limitation,
all attorneys’ fees and expenses, expert witness fees and expenses, court costs
and costs of investigation) suffered or incurred by an Indemnified Person by
virtue of such Indemnified Person’s acting as or on behalf of the Manager or the
Company in connection with the Company’s activities and (b) shall not be liable
to the Company, the Manager or any Member for any cost, claim, liability, loss,
damage or expense suffered or incurred in connection with the Company’s
activities; provided that (i) if such cost, claim, liability, loss, damage or
expense arises out of any action or inaction of any such Indemnified Person,
such course of conduct must not have constituted gross negligence, or willful
misconduct by such Indemnified Person; (ii) the Company shall, on demand, pay
all costs, expenses, attorneys’ fees and expert witness fees as and when
incurred by an Indemnified Person in connection with any such cost, claim,
liability, loss, damage or expense if the Indemnified Person undertakes to repay
the same to the Company in the event that it is finally determined by a court of
competent jurisdiction that the Indemnified Person shall not have been entitled
to indemnification hereunder; and (iii) the rights granted under this section
shall not be affected by, and shall survive, any dissolution or termination of
the Company and the death, disability, incapacity, resignation, withdrawal,
insolvency or dissolution of any Manager or Member.

12.2 Insurance. The Company shall have the power to purchase and maintain
insurance on behalf of any Person who is or was a Manager or an agent of the
Company or the Manager against any liability asserted against such Person and
incurred by such Person in any such capacity, or arising out of such Person’s
status as a Manager or an agent of the Company, whether or not the Company would
have the power to indemnify such Person against such liability under section
12.1 or under applicable law.

12.3 Directors and Officers Insurance; UTEK Indemnification. The Manager shall
use its best efforts to obtain, at the Company’s expense, reasonably priced
directors and officers insurance for the Manager and each Member. To the extent
not covered by insurance and by any right to indemnification by any Investment
Partnership, the Manager shall indemnify and hold harmless UTEK against any and
all losses, claims, damages, expenses and liabilities, (collectively, “Losses”)
of any kind or nature whatsoever, other than Losses due to the diminution in
value of UTEK’s membership interest in the Company, that UTEK may at any time
become subject to or liable for by reason of the Company being or having been
the general partner or manager of any Investment Partnership; provided, however,
that UTEK shall not be

 

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indemnified to the extent that such Losses are due to UTEK’s willful misconduct,
bad faith, gross negligence, violations of federal or state securities laws or
any intentional or criminal wrongdoing.

13. Investment Representations. Each Member hereby represents and warrants to,
and agrees with, the Manager, the other Members and the Company, with respect to
such Member and the Membership Interest of such Member, as follows:

13.1 No Advertising. The offer to sell the Membership Interest was directly
communicated to the Member by the Company in a manner that the Member was able
to ask questions of and receive answers from the Company concerning the terms
and conditions of such transaction. At no time was the Member presented with or
solicited by any leaflet, public promotional material, newspaper, magazine,
radio or television article or advertisement, or any other form of advertising
or general solicitation.

13.2 Investment Intent. The Membership Interest is being purchased by the Member
and not by any other Person, with the Member’s own funds and not with the funds
of any other Person, and for the account of the Member, not as a nominee or
agent and not for the account of any other Person. No other Person has or will
have any interest, beneficial or otherwise, in the Membership Interest. The
Member is purchasing the Membership Interest for investment for an indefinite
period, not with a view to the sale or distribution of any part or all thereof
by public or private sale or other disposition. The Member has no intention of
selling, granting any participation in or otherwise distributing or disposing of
the Membership Interest or any interest therein. The Member does not intend to
subdivide the Member’s purchase of the Membership Interest with any Person.

13.3 Accredited Investor. The Member is an “accredited investor” as defined in
Rule 501 promulgated by the Securities and Exchange Commission under the
Securities Act.

13.4 Economic Risk. Understanding that investment in Membership Interests is
highly speculative, the Member is able to bear the economic risk of such
investment, including the total loss thereof, for an indefinite period.

13.5 No Registration of Membership Interests. The Member understands that the
Membership Interest has not been registered under the Securities Act or
registered or qualified under any other securities law, on the grounds, among
others, that no distribution or public offering of Membership Interests is to be
effected and that Membership Interests are being issued by the Company in
connection with a transaction that does not involve any public offering within
the meaning of section 4(2) of the Securities Act under the rules and
regulations of the Securities and Exchange Commission thereunder and under
comparable exemptive provisions of other applicable securities laws, rules and
regulations. The Member understands that the Company is relying in part on the
Member’s representations as set forth herein for purposes of claiming such
exemptions.

13.6 Membership Interest Is A Restricted Security. The Member understands that
the Membership Interest is a “restricted security” under the Securities Act and,
accordingly, that the Membership Interest must be held indefinitely unless it is
subsequently registered under

 

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the Securities Act and registered or qualified under any other applicable
securities law or exemptions from such registration and qualification are
available. The Member understands that the Company is under no obligation so to
register or qualify the Membership Interest under the Securities Act or under
any other securities law, or to comply with the Regulation A or any other
exemption under the Securities Act or any other law. The Member understands that
Rule 144 is not available for any sale of the Membership Interest and will not
be available for a substantial period of time.

13.7 Company May Refuse to Transfer. If, in the opinion of counsel for the
Company, the Member at any time hereafter acts in a manner inconsistent with
such Member’s representations, warranties and agreements in this Agreement, the
Company may, without limiting any other remedy or relief available to the
Company, refuse to Transfer the Member’s Membership Interest until such time as
counsel for the Company is of the opinion that such Transfer will not require
registration of any Membership Interest under the Securities Act or registration
or qualification of any Membership Interest under any other securities law. The
Member understands and agrees that the Company may refuse to acknowledge or
permit any disposition that is not in all respects in compliance with this
Agreement and that the Company intends to make an appropriate notation in its
records to that effect.

13.8 No Disposition in Violation of Law. Without limiting the representations
set forth herein, and without limiting Article 8, the Member shall not Transfer
any Membership Interest or any interest therein, or receive any consideration
therefor, unless and until, prior to any proposed Transfer, the Member shall
comply with all requirements and conditions in this Agreement and:

13.8.1 a registration statement on Form S-l under the Securities Act (or any
other form appropriate for the purpose under the Securities Act or any form
replacing any such form) with respect to the Membership Interest or any part
thereof proposed to be so disposed of shall be then effective, and such
disposition shall have been appropriately registered or qualified in accordance
with any applicable securities law; or

13.8.2 (a) the Member shall have furnished the Company with a detailed
explanation of the proposed disposition; (b) the Member shall have furnished the
Company with an opinion of the Member’s counsel in form and substance
satisfactory to the Company to the effect that the proposed Transfer
(i) complies with applicable provisions of the Securities Act and any other
securities laws and will not require registration of the Member’s Membership
Interest or any part thereof under the Securities Act or registration or
qualification thereof under any other securities law, and (ii) will not result
in the termination of the Company for federal income tax purposes; and
(c) counsel for the Company shall have concurred in such opinion and the Manager
shall have advised the Member of such concurrence.

13.9 Legends. The Member understands and agrees that any instrument or
certificate representing or relating to the Membership Interest may bear such
legends as the Manager may consider necessary or advisable to facilitate
compliance with the Securities Act, and any other securities law, including,
without limitation, legends stating that the Membership Interest has not been
registered under the Securities Act or qualified under any other securities law
and setting forth the limitations on dispositions imposed by this Agreement.

 

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13.10 Investment Experience. The Member, either alone or with the Member’s
professional advisers who are unaffiliated with, have no equity interest in and
are not compensated by the Company or the Manager or any Affiliate or selling
agent of the Company or the Manager, directly or indirectly, has such knowledge
and experience in financial and business matters that the Member is capable of
evaluating the merits and risks of an investment in the Membership Interest and
has the capacity to protect the Member’s own interests in connection with the
Member’s investment in the Membership Interest.

13.11 Independent Advice. The Member has consulted with the Member’s own legal,
accounting, tax, investment and other advisers with respect to the tax treatment
of an investment by the Member in the Membership Interest and the merits and
risks of an investment in the Membership Interest.

13.12 Authority. This Agreement constitutes a legal, valid and binding agreement
of the Member, enforceable against the Member in accordance with its terms. The
Member, if not a natural person, is empowered and duly authorized to enter into
this Agreement (including the power of attorney herein) under every applicable
governing document, partnership agreement, operating agreement, trust
instrument, pension plan, charter, certificate of incorporation, bylaw provision
or the like. The Person, if any, signing this Agreement on behalf of the Member
is empowered and duly authorized to do so by the governing document, partnership
agreement, operating agreement, trust instrument, pension plan, charter,
certificate of incorporation, bylaw provision, board of directors or stockholder
resolution or the like.

13.13 Indemnification. The Member hereby agrees to indemnify and defend the
Company, the Manager and each of their respective employees, agents, partners,
members, shareholders, officers and directors and hold them harmless from and
against any and all claims, liabilities, damages, costs and expenses (including,
without limitation, court costs and attorneys’ fees and expenses) suffered or
incurred on account of or arising out of:

13.13.1 any breach of or inaccuracy in the Member’s representations, warranties
or agreements herein, including, without limitation, the defense of any claim
based on any allegation of fact inconsistent with any of such representations,
warranties or agreements;

13.13.2 any Transfer of Membership Interest contrary to any of such
representations, warranties or agreements; or

13.13.3 any action, suit or proceeding based on (a) a claim that any of such
representations, warranties or agreements was inaccurate or misleading or
otherwise cause for obtaining damages or redress under the Securities Act or any
other securities law, or (b) any Transfer of any part or all of the Membership
Interest.

14. Legal Counsel. Each Member acknowledges and understands that this Agreement
and related documents have been prepared by Reed Smith LLP (“Reed Smith”) acting
as counsel for the Manager, and that such counsel has not represented or been
engaged to provide services to any Member other than Verdant Ventures Managers
and Silicon Prairie Partners, LLC. Each other Member has been represented by
other counsel. Such Member acknowledges and understands that Reed Smith or other
counsel may hereafter be engaged by

 

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the Company or by the Manager to provide legal services and representation as
the Manager may determine, and in such event, Reed Smith may concurrently
represent either or both of the Manager and the Company and the Manager may
execute on behalf of the Company and the Members any consent to such concurrent
representation that Reed Smith or other counsel may request pursuant to the
applicable rules of professional conduct for lawyers. Each Member acknowledges
and understands that counsel for the Company or any other Member does not
represent any Member in the absence of a clear and explicit agreement to that
effect between such Member and such counsel, and in the absence of such
agreement, such counsel shall owe no duties to any Member. Each Member agrees
that in the event of any dispute between any of the Members and the Company, or
between any of the Members or the Company, on the one hand, and the Manager or
any of its Affiliates, on the other hand, counsel for the Company may represent
the Company or the Manager or such Affiliate, or both, in such dispute to the
extent permitted by such rules, and such Member hereby consents to such
representation.

15. Notices. Except as otherwise expressly provided herein, any notice, consent,
authorization or other communication to be given hereunder shall be in writing
and shall be deemed duly given and received when delivered personally, when
transmitted by facsimile one business day after being deposited for next-day
delivery with a nationally recognized overnight delivery service, or three
business days after being mailed by first class mail, charges and postage
prepaid, properly addressed to the party to receive such notice at the last
address furnished for such purpose by the party to whom notice is directed.

16. Severability. If any provision of this Agreement, or the application of such
provision to any Person or circumstance, shall be held by a court of competent
jurisdiction to be invalid or unenforceable, the remainder of this Agreement, or
the application of such provision to Persons or circumstances other than those
to which it is held to be invalid or unenforceable, shall not be affected
thereby.

17. Governing Law. This Agreement shall be governed by and construed and
interpreted in accordance with the laws of the State of Delaware.

18. Binding Effect. Subject to Article 8, this Agreement shall bind and inure to
the benefit of the parties and their respective Successors.

19. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

20. Entire Agreement. This Agreement contains the entire agreement of the
parties and supersedes all prior or contemporaneous written or oral
negotiations, correspondence, understandings and agreements between or among the
parties, regarding the subject matter hereof.

21. Further Assurances. Each Member shall provide such further information with
respect to that Member and any of its beneficial owners as the Company may
request, and shall do or perform such acts and things and execute and deliver
such other and further certificates, instruments and other documents, as may be
necessary and proper to implement, complete and perfect the transactions
contemplated by this Agreement.

 

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22. Headings; Gender; Number; References. The headings of the sections hereof
are solely for convenience of reference and are not part of this Agreement. As
used herein, each gender includes each other gender, and the singular includes
the plural and vice versa, as the context may require. All references to
sections and subsections are intended to refer to sections and subsections of
this Agreement, except as otherwise indicated.

23. Arbitration. The Members waive their rights to seek remedies in court,
including any right to a jury trial. The Members agree that in the event of any
dispute between or among any of them or any of their Affiliates arising out of,
relating to or in connection with this Agreement or the Company or its
organization, formation, business or management, such dispute shall be resolved
exclusively by arbitration to be conducted only in the county and state of the
principal office of the Company at the time of such dispute in accordance with
the rules of JAMS applying the laws of Delaware. The Members agree that such
arbitration shall be conducted by a retired judge who is experienced in dispute
resolution regarding the securities business, that discovery shall not be
permitted except as required by the rules of JAMS, that the arbitration award
shall not include factual findings or conclusions of law, and that no punitive
damages shall be awarded. The Members understand that any party’s right to
appeal or to seek modification of any ruling or award of the arbitrator is
severely limited. Any award rendered by the arbitrator shall be final and
binding, and judgment may be entered on it in any court of competent
jurisdiction in the county and state of the principal office of the Company at
the time such award is rendered, or as otherwise provided by law.

24. Parties in Interest. Except as expressly provided in the Act, nothing in
this Agreement shall confer any rights or remedies under or by reason of this
Agreement on any Persons other than the Members and their respective Successors
nor shall anything in this Agreement relieve or discharge the obligation or
liability of any third Person to any party to this Agreement, nor shall any
provision give any third Person any right of subrogation or action over or
against any party to this Agreement.

25. Amendments. All amendments to this Agreement or the Certificate shall be in
writing and signed or otherwise adopted or approved in writing by both (i) a
Super Majority in Interest of the Members and (ii) UTEK. For purposes of this
Article 25, in determining a Super Majority in Interest of the Members, UTEK
shall be entitled to vote its interest as a member, and the vote of such
interest shall be included in the determination of the vote of a Super Majority
in Interest of the Members with respect to the proposed amendment.

26. Attorneys’ Fees. If any dispute between or among any of the Company and the
Members or the Manager or any of their respective Affiliates should result in
litigation or arbitration, the prevailing party or parties in such dispute shall
be entitled to recover from the other party or parties all reasonable fees,
costs and expenses of enforcing any right of the prevailing party or parties,
including, without limitation, reasonable attorneys’ fees and expenses, all of
which shall be deemed to have accrued on the commencement of such action and
shall be paid whether or not such action is prosecuted to judgment Any
arbitration award, judgment or order entered in such action shall contain a
specific provision providing for the

 

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recovery of attorneys’ fees and costs incurred in enforcing such award or
judgment and an award of prejudgment interest from the date of the breach at the
maximum rate allowed by law. For the purposes of this Article 26, (a) attorneys’
fees shall include, without limitation, fees incurred in post-award or
post-judgment motions, contempt proceedings, garnishment, levy, and debtor and
third party examinations, discovery, and bankruptcy litigation, and
(b) prevailing party shall mean the party that is determined in the arbitration
or proceeding to have prevailed or who prevails by dismissal, default or
otherwise.

27. Remedies Cumulative. The remedies under this Agreement are cumulative and
shall not exclude any other remedies to which any Person may be lawfully
entitled.

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, this Limited Liability Company Agreement has been duly
executed on behalf of the Members as of the date first written above.

 

MEMBERS: VERDANT VENTURES MANAGERS, LLC, a Delaware limited liability company
By:  

/s/ John Micek

  John Micek,   Manager SILICON PRAIRIE PARTNERS, LLC, a California limited
liability company By:  

/s/ John Micek

  John Micek,   General Manager UTEK CORPORATION, a Florida corporation By:  

/s/ Doug Schaedler

  Doug Schaedler   Chief Executive Officer

 

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SCHEDULE 1

NAMES AND ADDRESSES OF MEMBERS,

CAPITAL CONTRIBUTIONS AND PERCENTAGE INTERESTS

 

Name and Address of Member

  

Capital Contribution

   Percentage Interest  

Verdant Ventures Managers, LLC 130 Lytton Ave., Suite 210 Palo Alto, California
94301

   $25,000 cash    80 % 

Silicon Prairie Partners, LLC 130 Lytton Ave, Suite 210 Palo Alto, California
94301

   $250,000 cash    5 % 

UTEK Corporation 2109 East Palm Ave., Suite 202 Tampa, Florida 33605

   that number of shares of UTEK common stock with a fair market value of
$1,000,000 based on the 20-day average closing price of a share of UTEK common
stock immediately prior to the date the Board of Directors of UTEK approves the
execution of this Agreement by UTEK (collectively, the “Contributed UTEK
Shares”)    15 %           

TOTAL

      100.0 % 

 

SCHEDULE 1

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SCHEDULE 2

CONSENT OF SPOUSE

I acknowledge that I have read the foregoing Limited Liability Company Agreement
dated as of April 14, 2010 (the “Agreement”) for Verdant Ventures Advisors, LLC
(the “Company”) and that I know its contents. I hereby consent to and approve of
the provisions of the Agreement, and agree that I will take no action at any
time to hinder operation of the Agreement on such interest or any interest which
I may have therein.

 

 

Name:  

 

Spouse of  

 

Dated: As of  

 

  , 200    .

 

SCHEDULE 2

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SCHEDULE 3

AGREEMENT OF SUCCESSOR MANAGER

[to be executed pursuant to section 6.2.4 upon the

appointment of a Designated Successor Manager

or the election of an Elected Successor Manager]

The undersigned,                                          
                                   , hereby (i) accepts his/her/its appointment
as Designated Successor Manager or election as Elected Successor Manager
pursuant to section 6.2.4 of the Limited Liability Company Agreement of Verdant
Ventures Advisors, LLC, a Delaware limited liability company dated April 14,
2010 (the “Agreement”), to be effective upon the resignation or removal of the
Manager; and (ii) adopts and agrees to be bound by all of the terms and
conditions of the Agreement.

Dated:                                         

 

 

Designated Successor Manager/Elected Successor Manager

 

SCHEDULE 3

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APPENDIX A

DEFINITIONS

1. When used in this Agreement, the following capitalized terms have the
following respective meanings:

1.1 “Act” means the Delaware Limited Liability Company Act, as the same may be
amended from time to time.

1.2 “Adjusted Capital Account Deficit” means, with respect to any Member, the
deficit balance, if any, in such Member’s Capital Account as of the end of the
relevant Fiscal Year, after giving effect to the following adjustments:

(a) credit to such Capital Account any amounts which such Member is obligated to
restore pursuant to any provision of this Agreement or is deemed to be obligated
to restore pursuant to the next to the last sentence of Sections 1.704-2(g)(1)
and 1.704-2(i)(5) of the Regulations; and

(b) debit to such Capital Account the items described in
Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6) of the Regulations.

The foregoing definition of Adjusted Capital Account Deficit is intended to
comply with the provisions of Section 1.704-1(b)(2)(ii)(d) of the Regulations
and shall be interpreted consistently therewith.

1.3 “Affiliate” means, with reference to a specified Person, any Person directly
or indirectly controlling, controlled by or under common control with the
specified Person, any trust or foundation to which the specified Person has made
a majority of the grants, donations or contributions received by that trust or
foundation, a Person owning or controlling ten percent or more of the
outstanding voting securities of the specified Person, a Person ten percent or
more of whose outstanding voting securities are owned or controlled by the
specified Person, any officer, director, manager, general partner or trustee of
the specified Person, and if the specified Person is an officer, director,
manager, general partner or trustee, any corporation, limited liability company,
partnership or trust for which the specified Person acts in any such capacity.

1.4 “Aggregate Company Tax Liability” means, with respect to a Member, such
Member’s allocable share of the Company’s net taxable income pursuant to this
Agreement since the date hereof through the end of the relevant Fiscal Year,
giving effect to such Member’s share of losses and deductions, multiplied by the
rate equal to the difference between (i) the highest combined marginal United
States federal and state tax rates applicable to any Member (or the owner(s) of
any Member taxed as a partnership or S corporation) with respect to such net
taxable income, and (ii) the product of the two rates. For this purpose, “net
taxable income” of the Company shall be calculated taking into account
separately stated items, and without regard

 

Appendix A-1

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to items of income exempt from tax. For purposes of this definition of
“Aggregate Company Tax Liability,” the “net taxable income” of the Company shall
not include gain or loss from the sale of all or substantially all the assets of
the Company. The Manager shall make such adjustments to the calculation of
Aggregate Company Tax Liability as it deems appropriate to account for (i) the
character of items of the Company’s taxable income (e.g., ordinary income,
long-term capital gain or other), (ii) any changes in applicable tax rates over
the period of determination, and (iii) such other matters relating to the
application of the tax laws as it considers appropriate.

1.5 “Agreement” means this Limited Liability Company Agreement, as amended from
time to time.

1.6 “Assignee” means the owner of an Economic Interest who has not been admitted
as a Member of the Company in accordance with Article 8.

1.7 “Bankruptcy” means the occurrence of any event referred to in section
18-304(a) of the Act.

1.8 “Book Value” means, with respect to any asset of the Company, the Company’s
adjusted basis for federal income tax purposes, adjusted from time to time to
reflect the adjustments required or, if the Manager elects, permitted by
Treasury Regulations section 1.704-1(b)(2)(iv)(d)-(g).

1.9 “Capital Account” means:

1.9.1 The individual Capital Account that shall be established and maintained
for each Member in accordance with the following provisions:

(a) To the Capital Account of a Member there shall be credited such Member’s
Capital Contributions, such Member’s share of Profits, any items in the nature
of income or gain that are specially allocated thereto pursuant to Appendix B
and the amount of any Company liabilities that are personally assumed by such
Member or that are secured by any Company property distributed to such Member;

(b) From the Capital Account of a Member, there shall be debited the amount of
cash and the fair market value, as determined by the Manager, of any Company
property distributed to such Member pursuant to any provision of this Agreement,
such Member’s share of Losses, any items in the nature of expenses or Losses
that are specially allocated thereto pursuant to Appendix B and the amount of
any liabilities of such Member that are assumed by the Company or that are
secured by any property contributed by such Member to the Company; and

(c) In determining the amount of any liability, there shall be taken into
account Code section 752(c) and any other applicable provisions of the Code and
Regulations.

 

Appendix A-2

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(d) If any interest in the Company is transferred in accordance with this
Agreement, the transferee shall succeed to the Capital Account of the transferor
to the extent that it relates to the transferred interest.

(e) The foregoing provisions and other provisions of this Agreement relating to
the maintenance of Capital Accounts are intended to comply with Regulations
section 1.704-1(b), and shall be interpreted and applied in a manner consistent
therewith. If the Manager determines that it is prudent to modify the manner in
which the Capital Accounts, or any debits or credits thereto, are computed in
order to comply with Regulations section 1.704-1(b), the Manager may make such
modification if it is not likely to have a materially adverse effect on amounts
distributable to any Member pursuant hereto on the dissolution of the Company.
The Manager shall adjust the amounts debited or credited to Capital Accounts
with respect to any property contributed to the Company or distributed to a
Member and any liabilities secured by such contributed or distributed property
or assumed by the Company or Member in connection with such contribution or
distribution if the Manager determines that such adjustments are necessary or
appropriate under Regulations section 1.704-1(b)(2)(iv). The Manager shall also
make any appropriate modifications if unanticipated events might cause this
Agreement not to comply with Regulations section 1.704-1(b), and the Manager
shall make all elections provided for under such Regulations.

1.10 “Capital Contribution” of a Member means the total value of cash and the
fair market value, as determined by the Manager, of property contributed to the
Company by that Member.

1.11 “Cause” means any of the following activities if committed or engaged in by
the Manager or its controlling person:

(a) a misdemeanor involving moral turpitude or a felony, for which he or she is
convicted, and which conviction has had or is having an adverse effect on the
condition or business of the Company;

(b) illegal practices or conduct in connection with the Company’s business;

(c) misappropriation of any of the Company’s assets; or

(d) any material breach of any of the agreements, covenants, representations or
warranties in this Agreement or any other agreement between the Company and the
Manager or controlling person; provided that if (and only if) the act or
omission constituting or resulting in such breach shall not have constituted
recklessness, gross negligence or willful or intentional misconduct and shall
not have been intended to breach any provision of this Agreement, such breach
shall not be deemed to constitute “Cause,” unless the Company shall have given
the Manager controlling person, as the case may be, notice thereof and the
Manager or controlling person shall not have cured such breach within thirty
(30) days of such notice, or if such breach is not capable of being cured, until
there shall have occurred another material breach of any of such agreements,
covenants, representations or warranties (whereupon Cause shall be deemed to
have occurred).

 

Appendix A-3

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

1.12 “Certificate” means the Certificate of Formation for the Company filed with
the Delaware Secretary of State, as amended.

1.13 “Code” means the Internal Revenue Code of 1986, as amended from time to
time (or any corresponding provisions of succeeding law).

1.14 “Company” means Verdant Ventures Advisors, LLC, a Delaware limited
liability company.

1.15 “Company Minimum Gain” has the meaning ascribed to the term “partnership
minimum gain” in Treasury Regulations section 1.704-2(d).

1.16 “Contributed UTEK Shares” has the meaning set forth on Schedule 1.

1.17 “Contribution Notice” has the meaning set forth in section 5.2.3.

1.18 “Depreciation” means for each Fiscal Year or other period, an amount equal
to the depreciation, amortization, or other cost recovery deduction allowable
with respect to an asset for such year or other period, except that if the Gross
Asset Value of an asset differs from its adjusted basis for federal income tax
purposes at the beginning of such year or other period, Depreciation shall be an
amount which bears the same ratio to such beginning Gross Asset Value as the
federal income tax depreciation, amortization, or other cost recovery deduction
for such year or other period bears to such beginning adjusted tax basis;
provided, however, that if the adjusted basis for federal income tax purposes of
an asset at the beginning of such year or other period is zero, Depreciation
shall be determined with reference to such beginning Gross Asset Value using any
reasonable method selected by the Manager.

1.19 “Designated Successor Manager” has the meaning set forth in section 6.2.4.

1.20 “Dissolution Event” means one or more of the following: the death,
dissolution, resignation or Bankruptcy of a Manager.

1.21 “Economic Interest” means a Member’s or Assignee’s right to share in one or
more of the Profits, Losses, or similar items of, and to receive distributions
from, the Company, pursuant to this Agreement and the Act, but does not include
any other rights of a Member, including, without limitation, the right to vote
or consent or participate in management, or any right to information concerning
the business and affairs of the Company.

1.22 “Elected Successor Manager” has the meaning set forth in section 6.2.4.

 

Appendix A-4

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1.23 “Fee Income” means an amount computed for each Fiscal Period equal to all
income of the Company realized in such Fiscal Period from the receipt by the
Company of (a) closing fees or management fees from portfolio companies of
Investment Partnerships, (b) management fees and transaction fees from
Investment Partnerships or from the investors in such Investment Partnerships,
and (c) any fees received by the Company in exchange for the services of the
Manager, an employee of the Company, or any designee of the Manager as a member
of the board of directors of or as an employee of or consultant to any such
portfolio company.

1.24 “Finders” means advisors, consultants, employees and operating partners of
the Company that refer investment opportunities to the Company or are otherwise
related to an investment opportunity.

1.25 “First Anniversary Date” has the meaning set forth in section 4.10.1.

1.26 “First Source” has the meaning set forth in section 7.2.

1.27 “Fiscal Period” means a Fiscal Year or, if a Member makes a Capital
Contribution as of any date other than the first day of a Fiscal Year or a
permitted assignment is effective as of a date other than the last day of a
Fiscal Year, the period from the beginning of such Fiscal Year to the date of
such Capital Contribution or permitted assignment, or the period from the date
of such Capital Contribution or permitted assignment to the earlier of (a) the
date as of which another Member makes a Capital Contribution or a permitted
assignment and (b) the end of the Fiscal Year.

1.28 “Fiscal Quarter” means the period commencing on the date the Company
commences business and ending on the succeeding March 31, June 30, September 30
or December 31, as the case may be, each period thereafter of three calendar
months ending on any March 31, June 30, September 30 or December 31, or the
period from the January 1, April 1, July 1 or October 1, as the case may be,
preceding the date of dissolution and termination of the Company and ending on
the date of dissolution and termination of the Company.

1.29 “Fiscal Year” means the period commencing on the date the Company commences
business or commencing on any subsequent January 1, and ending on the succeeding
December 31, or, if earlier, the date of dissolution and termination of the
Company.

1.30 “Fourth Source” has the meaning set forth in section 7.2.

1.31 “Gross Asset Value” means with respect to any asset, the asset’s adjusted
basis for federal income tax purposes, except as follows:

(a) the initial Gross Asset Value of any asset contributed by a Member to the
Company shall be the gross fair market value of such asset, as determined by the
Manager;

(b) the Gross Asset Values of all Company assets shall be adjusted to equal
their respective gross fair market values, as determined by the Manager, as of
the following times: (1) the acquisition of an additional interest in the
Company by any new or

 

Appendix A-5

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existing Member in exchange for more than a de minimis capital contribution;
(2) the distribution by the Company to a Member of more than a de minimis amount
of Company property as consideration for an interest in the Company; and (3) the
liquidation of the Company within the meaning of Treasury Regulations
Section 1.704-1(b)(2)(ii)(g); provided, however, that adjustments pursuant to
clauses (1) and (2) above shall be made only if the Manager reasonably
determines that such adjustments are necessary or appropriate to reflect the
relative economic interests of the Members in the Company;

(c) the Gross Asset Value of any Company asset distributed to any Member shall
be adjusted to equal the gross fair market value of such asset on the date of
distribution, as determined by the Manager; and

(d) the Gross Asset Value of Company assets shall be increased (or decreased) to
reflect any adjustments to the adjusted basis of such assets pursuant to Code
Section 734(b) or Code Section 743(b), but only to the extent that such
adjustments are taken into account in determining Capital Accounts pursuant to
Treasury Regulations Section 1.704-1(b)(2)(iv)(m) and paragraph (d) of the
definition of “Profit” or paragraph (e) of the definition of “Loss” or section
6.2B of Appendix B; provided, however, that Gross Asset Values shall not be
adjusted pursuant to this subparagraph (d) to the extent the Manager determines
that an adjustment pursuant to subparagraph (b) above is necessary or
appropriate in connection with a transaction that would otherwise result in any
adjustment pursuant to this subparagraph (d).

If the Gross Asset Value of an asset has been determined or adjusted pursuant to
subparagraphs (a), (b) or (d) above, such Gross Asset Value shall thereafter be
adjusted by the Depreciation taken into account with respect to such asset for
purposes of computing Loss.

1.32 “Indemnified Person” has the meaning set forth in section 13.1.

1.33 “Initial Value” has the meaning set forth in section 3.2.

1.34 “Investment Opportunity Notice” has the meaning set forth in section 5.2.1.

1.35 “Investment” has the meaning set forth in section 4.10.1.

1.36 “Investment Partnership” has the meaning set forth in section 5.1.1.

1.37 “Liquidating Person” has the meaning set forth in section 11.2.

1.38 “Loss” means, for each Fiscal Year or Fiscal Period, an amount equal to the
Company’s gross taxable loss for such Fiscal Year or Fiscal Period, determined
in accordance with Section 703(a) of the Code (for this purpose, all items of
loss or deduction required to be stated separately pursuant to Section 703(a)(1)
of the Code shall be included in taxable loss), subject to the following
adjustments:

(a) Such taxable loss shall be decreased by the amount of all expenditures made
by the Company during such period which are described in Code
Section 705(a)(2)(B) or treated as so described pursuant to Treasury Regulations
Section 1.704-1(b)(2)(iv)(i), and not otherwise taken into account in computing
Loss pursuant to this paragraph;

 

Appendix A-6

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(b) In the event that the Gross Asset Value of any Company asset is decreased
pursuant to subparagraphs (b) or (c) of the definition of “Gross Asset Value,”
the amount of such decrease shall be treated as an item of loss from the
disposition of such asset and shall be taken into account for purposes of
computing Loss;

(c) Loss resulting from any disposition of property with respect to which loss
is recognized for federal income tax purposes shall be computed by reference to
the Gross Asset Value of the property disposed of, notwithstanding that the
adjusted tax basis of such property differs from its Gross Asset Value;

(d) In lieu of the depreciation, amortization and other cost recovery deductions
taken into account in computing such taxable loss, there shall be taken into
account Depreciation with respect to each asset of the Company for such Fiscal
Year computed in accordance with the definition of Depreciation;

(e) To the extent a decrease to the adjusted basis of any Company asset pursuant
to Section 734(b) or 743(b) of the Code is required pursuant to
Section 1.704-1(b)(2)(iv)(m)(4) of the Treasury Regulations to be taken into
account in determining Capital Accounts as a result of a distribution other than
in complete liquidation of a Member’s interest, the amount of such decrease
shall be treated as an item of loss (if the adjustment decreases the basis of
the asset) from the disposition of the asset and shall be taken into account in
computing Loss; and

(f) Notwithstanding any other provision of this definition, any items specially
allocated pursuant to Appendix B hereof shall not be considered in determining
Loss; and amounts of items of Company loss or deduction available to be
specially allocated pursuant to Appendix B hereof shall be determined by
applying rules analogous to those set forth in paragraphs (a) through
(e) hereof.

1.39 “Majority in Interest” of the Members means Members whose Percentage
Interests as set forth in Schedule 1, on the date of determination, aggregate
more than fifty percent of the Percentage Interests of all Members on that date.
For purposes hereof, in determining a Majority in Interest of the Members, the
Manager shall be entitled to vote any interest held by it, either directly or
indirectly, with respect to all matters on which the Members are entitled to
vote, and the vote of such interest shall be included in the determination of
the vote of a Majority in Interest of the Members.

1.40 “Manager” means Verdant Ventures Managers, LLC or a successor Manager
designated or elected pursuant to section 6.2.

 

Appendix A-7

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

1.41 “Managers LLC” means Verdant Ventures Managers, LLC.

1.42 “Member” means each Person who is an initial signatory to this Agreement,
has been subsequently admitted to the Company as a Member in accordance with the
Certificate or this Agreement or is an Assignee who has become a Member in
accordance with Article 8 and, in each case, who has not ceased to be a Member.

1.43 “Member Minimum Gain” has the meaning ascribed to the term “partner
nonrecourse debt minimum gain” in Treasury Regulations section 1.704-2(i)(2).

1.44 “Member Nonrecourse Debt” has the meaning ascribed to the term “partner
nonrecourse debt” in Treasury Regulations section 1.704-2(b)(4).

1.45 “Member Nonrecourse Deductions” means items of Company loss, deduction or
Code section 705(a)(2)(b) expenditures that are attributable to Member
Nonrecourse Debt within the meaning of Treasury Regulations section 1.704-2(i).

1.46 “Membership Interest” of a Member means a Member’s rights in the Company,
including, without limitation, the Member’s Economic Interest, the right to vote
or consent or participate in the management of the Company and any right to
receive information concerning the business and affairs of the Company provided
hereby or by the Act.

1.47 “Nonrecourse Liability” has the meaning set forth in Treasury Regulations
section 1.752-1(a)(2).

1.48 “Participating Member” has the meaning set forth in section 5.2.2.

1.49 “Participation Amount” has the meaning set forth in section 5.2.3.

1.50 “Percentage Interest” of a Member means the Member’s percentage interest in
certain Profits and Losses of the Company as specified in this Agreement, such
percentage to be initially determined by the Manager at the time such Member
contributes capital to the Company, as subsequently adjusted as provided in
sections 3.3 and 3.4. Members’ Percentage Interests are set forth on Schedule 1,
as amended from time to time.

1.51 “Person” means a natural person, partnership (whether general or limited
and whether domestic or foreign), limited liability company, foreign limited
liability company, trust, estate, association, corporation, custodian, nominee,
or any other individual or entity in its own or any representative capacity.

1.52 “Profits” means, for each Fiscal Period or other period, an amount equal to
the Company’s taxable income for such Fiscal Period or other period, 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), with the
following adjustments:

(a) Such taxable income shall be increased by the amount of all income of the
Company that is exempt from federal income tax and not otherwise taken into
account in computing Profits pursuant to this section 1.52;

 

Appendix A-8

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

(b) If the event that the Gross Asset Value of any Company asset is increased
pursuant to subparagraphs (b) or (c) of the definition of “Gross Asset Value,”
the amount of such increase shall be treated as an item of gain from the
disposition of such asset and shall be taken into account for purposes of
computing Profit;

(c) Gain resulting from any disposition of property with respect to which gain
is recognized for federal income tax purposes shall be computed by reference to
the Gross Asset Value of the property disposed of, notwithstanding that the
adjusted basis of such property differs from its Gross Asset Value;

(d) To the extent an increase to the adjusted basis of any Company asset
pursuant to Section 734(b) or 743(b) of the Code is required pursuant to
Section 1.704-1(b)(iv)(m)(4) of the Treasury Regulations to be taken into
account in determining Capital Accounts as a result of a distribution other than
in compete liquidation of a Member’s interest, the amount of such adjustment
shall be treated as an item of gain (if the adjustment increases the basis of
the asset) from the disposition of the asset and shall be taken into account in
computing Profits; and

(e) Notwithstanding any other provision of this section 1.52, any items of
income or gain that are specially allocated pursuant to Appendix B shall not be
considered in determining Profit; and amounts of items of Company income and
gain available to be specially allocated pursuant to Appendix B shall be
determined by applying rules analogous to those set forth in paragraphs
(a) through (d) hereof.

1.53 “Retained Participation Right” has the meaning set forth in section 4.10.1.

1.54 “Retained Right to Distributions” has the meaning set forth in section
4.10.1.

1.55 “Second Anniversary Date” has the meaning set forth in section 4.10.2.

1.56 “Second Source” has the meaning set forth in section 7.2.

1.57 “Securities” means securities of every kind and nature and rights and
options with respect thereto, including stock, notes, bonds, debentures,
evidences of indebtedness and other business interests of every type, including
partnerships, joint ventures, proprietorships and other business entities.

 

Appendix A-9

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

1.58 “Securities Act” means the federal Securities Act of 1933, as amended.

1.59 “Successor” of a Member means any transferee, successor, assign, heir,
devisee, legatee, legal representative, executor or administrator of that
Member.

1.60 “Super Majority In Interest” of the Members means Members whose Percentage
Interests as set forth in Schedule 1, on the date of the determination,
aggregate more than seventy percent (70%) of the Percentage Interests of all the
Members on that date. For purposes hereof, in determining a Super Majority in
Interest of the Members, the Manager shall be entitled to vote any interest held
by it, either directly or indirectly, with respect to all matters on which the
Members are entitled to vote, and the vote of such interest shall be included in
the determination of the vote of a Majority in Interest of the Members.

1.61 “Tax Matters Partner” shall be Verdant Ventures Managers, LLC or its
successor as such designated pursuant to section 10.6.

1.62 “Tax Shortfall” has the meaning set forth in section 7.2.5.

1.63 “Third Anniversary Date” has the meaning set forth in section 4.10.3.

1.64 “Third Source” has the meaning set forth in section 7.2.

1.65 “Transfer” means any sale, assignment, transfer, encumbrance, pledge,
hypothecation, gift or other disposition or alienation, voluntarily,
involuntarily, by operation of law or otherwise (including, but not limited to,
on death, Bankruptcy or divorce of a Member), except a sale to the Company.

1.66 “Treasury Regulations” means the Income Tax Regulations promulgated under
the Code, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).

1.67 “Unsubscribed New Capital” has the meaning set forth in section 5.3.

1.68 “UTEK Contribution Date” has the meaning set forth in section 4.10.1.

1.69 “UTEK Business Enterprise” has the meaning set forth in section 4.10.1.

 

Appendix A-10

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APPENDIX B

SPECIAL ALLOCATIONS

7.1B Special Allocations. Notwithstanding section 7.1, the following special
allocations shall be made in the following order:

7.1.1B Minimum Gain Chargeback. Except as otherwise provided in
Section 1.704-2(f) of the Treasury Regulations, if there is a net decrease in
Company Minimum Gain during any Fiscal Year, each Member shall be specially
allocated items of Company income and gain for such year (and, if necessary,
subsequent years) in proportion to, and to the extent of an amount equal to such
Member’s share of the net decrease in Company Minimum Gain, determined in
accordance with Section 1.704-2(g)(2) of the Treasury Regulations. Allocations
pursuant to the previous sentence shall be made in proportion to the respective
amounts required to be allocated to each Member pursuant thereto. The items to
be so allocated shall be determined in accordance with Sections 1.704-2(f)(6)
and 1.704-2(j)(2) of the Treasury Regulations. This section 7.1.1B is intended
to comply with the minimum gain chargeback requirement of the Treasury
Regulations and shall be interpreted consistently therewith.

7.1.2B Member Minimum Gain Chargeback. Except as otherwise provided in
Section 1.704-2(i)(4) of the Treasury Regulations, if there is a net decrease in
Member Minimum Gain during any Fiscal Year, each Member with a share of the
Member Minimum Gain, determined in accordance with Section 1.704-2(i)(5) of the
Treasury Regulations, shall be specially allocated items of Company income and
gain for such year (and, if necessary, subsequent years) in proportion to, and
to the extent of, and in amount equal to such Member’s share of the net decrease
in Member Minimum Gain, determined in accordance with Section 1.704-2(i)(4) of
the Treasury Regulations. Allocations pursuant to the previous sentence shall be
made in proportion to the respective amounts required to be allocated to each
Member pursuant thereto. The items to be so allocated shall be determined in
accordance with Sections 1.704-2(i)(4) and 1.704-2(j)(2) of the Treasury
Regulations. This section 7.1.2B is intended to comply with the member minimum
gain chargeback requirement of the Treasury Regulations and shall be interpreted
consistently therewith.

7.1.3B Qualified Income Offset. In the event any Member unexpectedly receives
any adjustments, allocations or distributions described in
Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6) of the Treasury Regulations, items
of Company income and gain shall be specially allocated to each such Member in
an amount and manner sufficient to eliminate, to the extent required by the
Treasury Regulations, the Adjusted Capital Account Deficit of such Member as
quickly as possible, provided that an allocation pursuant to this section 7.1.3B
shall be made only if and to the extent that such Member would have an Adjusted
Capital Account Deficit after all other allocations provided for in section 7.1
of the Agreement and this Appendix B have been tentatively made as if this
section 7.1.3B were not in the Agreement.

 

Appendix B-1

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7.1.4B Nonrecourse Deductions. Nonrecourse Deductions for any Fiscal Year shall
be specially allocated to the Members in accordance with their respective
Percentage Interests.

7.1.5B Member Nonrecourse Deductions. Any Member Nonrecourse Deductions for any
Fiscal Year shall be allocated to the Member who bears the Economic Risk of Loss
with respect to the Member Nonrecourse Debt to which such Member Nonrecourse
Deductions are attributable in accordance with Treasury Regulations section
1.704-2(i)(1).

7.1.6B Curative Allocations. The allocations set forth in this section 7.1B (the
“Regulatory Allocations”) are intended to comply with certain requirements of
the applicable Treasury Regulations promulgated under Code Section 704(b).
Notwithstanding any other provision of section 7.1 of the Agreement and this
Appendix B, the Regulatory Allocations shall be taken into account in allocating
other Profits, Losses and other items of income, gain, loss, deduction and
credit to the Members for Capital Account purposes so that, to the extent
possible, the net amount of such allocations of Profits, Losses and other items
shall be equal to the amount that would have been allocated to each Member if
the Regulatory Allocations had not occurred.

7.2B Section 754 Adjustments. To the extent an adjustment to the adjusted tax
basis of Company assets pursuant to Code Section 734(b) or 743(b) is required
pursuant to Section 1.704-1(b)(2)(iv)(m)(2) or (4) of the Treasury Regulations,
to be taken into account in determining Capital Accounts as the result of a
distribution to a Member in complete liquidation of its interest in the Company,
the amount of such adjustment to Capital Accounts shall be treated as an item of
gain (if the adjustment increases the basis of the asset) or loss (if the
adjustment decreases such basis) and such gain or loss shall be specially
allocated to the Members in accordance with their interests in the Company in
the event that Section 1.704-1(b)(2)(iv)(m)(2) of the Treasury Regulations
applies, or to the Member to whom such distribution was made in the event that
1.704-1(b)(2)(iv)(m)(4) of the Treasury Regulations applies.

7.3B Code Section 704(c) Allocations. Notwithstanding any other provision in
section 7.1 and this Appendix B, in accordance with Code Section 704(c) and the
Treasury Regulations promulgated thereunder, income, gain, loss, and deduction
with respect to any asset contributed to the capital of the Company 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 Company for
federal income tax purposes and its fair market value on the date of
contribution. Allocations pursuant to this section 7.3B are solely for purposes
of Federal, state and local income tax purposes. As such, they shall not affect
or in any way be taken into account in computing a Member’s Capital Account or
share of profits, losses, or other items of distributions pursuant to any
provision of this Agreement

7.4B Tax Allocations.

7.4.1B In each Fiscal Year, items of income, deduction, gain, loss or credit
that are recognized for income tax purposes shall be allocated among the Members
in a manner

 

Appendix B-2

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

that reflects equitably amounts credited to or debited against the Capital
Account of each Member, whether in such Fiscal Year or in prior Fiscal Years. To
this end, the Company shall establish and maintain records that show the extent
to which the Capital Account of each Member shall, as of the last day of each
Fiscal Year, comprise amounts that have not been reflected in the taxable income
of such Member. To the extent deemed by the Manager to be feasible and
equitable, taxable income and gains in each Fiscal Year shall be allocated among
the Members who shall have enjoyed the related credits, and items of deduction,
loss and credit in each Fiscal Year shall be allocated among the Members who
shall have borne the burden of the related debits.

7.4.2B In the event the Gross Asset Value of any Company asset is adjusted in
accordance with the definition of “Gross Asset Value” hereof, subsequent
allocations of items of income, gain, loss, deduction and credit with respect to
such asset shall take account of any variation between the adjusted basis of
such asset for U.S. federal income tax purposes and its Gross Asset Value in a
manner consistent with the principles of Code Section 704(c) and the Treasury
Regulations promulgated thereunder.

7.4.3B Notwithstanding any provisions to the contrary, if taxable gain to be
allocated includes income resulting from the sale or disposition of Company
property or property of an Investment Partnership or other limited partnership,
limited liability company, or joint venture in which the Company owns an
interest that is treated as ordinary income, such gain so treated as ordinary
income shall be allocated to and reported by each Member in proportion to
allocations to that Member of the items that shall have given rise to such
ordinary income, and the Company shall keep records of such allocations.

7.4.4B Any elections or other decisions relating to such allocations shall be
made by the Manager in any manner that reasonably reflects the purpose and
intention of this Agreement.

7.4.5B Allocations pursuant to this section 7.4B are solely for purposes of
federal, state and local taxes and shall not affect, or in any way be taken into
account in computing, any Capital Account or share of Profits, Losses or other
items of any Member, or distributions to any Member, pursuant to any provision
of this Agreement.

7.5B Other Allocation Rules.

7.5.1B Generally, all Profits and Losses shall be allocated among the Members as
provided in section 7.1 and this Appendix B. If Members are admitted to the
Company on different dates during any Fiscal Year, the Profits or Losses
allocated among the Members for each such Fiscal Year shall be allocated in
accordance with Code Section 706, using any convention permitted by law and
selected by the Manager.

7.5.2B Each Member acknowledges that such Member is aware of the income tax
consequences of the allocations made by section 7.1 and this Appendix B and
hereby agrees to be bound by section 7.1 and this Appendix B in reporting such
Member’s shares of Profits and Losses for income tax purposes.

 

Appendix B-3

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

7.5.3B If any amount claimed by the Company to constitute a deductible expense
in any Fiscal Year is treated by any federal, state or local taxing authority as
a payment made to a Member in such Member’s capacity as a member of the Company
for income tax purposes, with regard to such authority, items of income and gain
of the Company for such Fiscal Year shall first be allocated to such Member to
the extent of such payment.

 

Appendix B-4

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EXHIBIT A

SUMMARY OF PRINCIPAL TERMS OF INVESTMENT PARTNERSHIPS

 

  1. STRUCTURE.

Each Investment Partnership will be organized as a limited partnership, limited
liability company, corporation, or similar legal entity. Verdant Ventures
Advisors, LLC (the “General Partner”) will serve as the general partner,
manager, or similar agent of each Investment Partnership, together with such
additional persons or entities as the General Partner may determine.

 

  2. PURPOSE.

The primary purpose of each Investment Partnership will be to acquire, hold, and
otherwise deal with securities and other assets that the Investment Partnership
may receive from its portfolio company (or companies) or otherwise.

 

  3. TERM.

Each Investment Partnership will have a ten-year term. An Investment Partnership
may dissolve prior to the end of its stated term upon the written election of
the General Partner. Additionally, the General Partner may extend the term of
any Investment Partnerships for successive one-year periods (but not for more
than a total of two additional years for any Investment Partnership).

 

  4. CAPITAL CONTRIBUTIONS OF THE GENERAL PARTNER.

Verdant Ventures Advisors, LLC will contribute as the General Partner an amount
equal at least 0.2% of the total capital of each Investment Partnership on the
same schedule as the limited partners, members, shareholders or similar
investors in the Investment Partnership (together with the General Partner, the
“Investors”). Any capital contribution made by Verdant Ventures Advisors, LLC to
an Investment Partnership in excess of such amount may be made by Verdant
Ventures Advisors, LLC as a limited partner of such Investment Partnership.

 

  5. ALLOCATION OF INCOME, GAINS AND LOSSES.

Net capital gain or loss of an Investment Partnership for each year will be
allocated 80% to its Investors pro rata in proportion to their committed capital
and 20% to the General Partner; provided that to the extent that an allocation
of net capital loss would cause the General Partner’s capital account to be less
than 0.2% (or such other applicable capital percentage) of the positive capital
account balances of all Investors for such Investment Partnership (excluding
allocations made to the General Partner’s capital account with respect to the
General Partner’s 20% profits interest), such net capital loss (a “Contingent
Loss”) will be reallocated to the Investors in proportion to their contributed
capital. To the extent the Investors have been allocated Contingent Losses,
subsequent net capital gains will be allocated first to the Investors until such
Contingent Losses have been restored and then in accordance with the first
sentence hereof.

 

Exhibit A-1

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

Net ordinary gain or loss, including the expense of the management fee and other
expenses, will be allocated to the Investors pro rata in proportion to their
committed capital.

 

  6. DISTRIBUTIONS.

Within 90 days following the end of the fiscal year for an Investment
Partnership, each of its Investors will be paid in cash an amount equal to
            % of the net taxable income allocated to such Investor’s capital
account with respect to such fiscal year and all prior accounting periods,
reduced by the amount of any cash distributions received by such Investor during
such fiscal year and all prior accounting periods. However, no such distribution
will be required to the extent that the General Partner determines, in its sole
discretion, that the Investment Partnership’s cash reserves are inadequate for
such purpose or if the aggregate distribution would be less than $            .

In addition, the General Partner may, in its discretion but subject to certain
restrictions and limitations, make additional distributions in cash or in kind.
Prior to the time that the Investors for an Investment Partnership have received
aggregate distributions equal to the sum of their aggregate capital
contributions, discretionary distributions in respect of Investment Partnership
investments will be made 100% to the Investors in proportion to their capital
commitments. After such point, discretionary distributions may be made 80% to
the Investors in proportion to their capital commitments and 20% to the General
Partner. The General Partner may also make distributions to the Investors in
proportion to their respective capital commitments or to all Investors other
than the General Partner in proportion to their respective capital commitments.

 

  7. MANAGEMENT FEE AND TRANSACTION FEE.

The General Partner will receive a management fee based on the committed capital
of each Investment Partnership. The management fee will be at an annual rate
equal to 2% of the committed capital of the Investment Partnership. The
management fee shall be paid annually in advance.

[Upon the admission of each Investor to an Investment Partnership, the General
Partner will also receive a one-time transaction fee based on the capital
commitment of such Investor to the Investment Partnership. The transaction fee
will be an amount equal to 1.00% of the capital commitment of such Investor to
the Investment Partnership and shall be in addition to the Investor’s capital
commitment to the Investment Partnership.]

 

Exhibit A-2

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

  8. OPERATING EXPENSES.

The General Partner will be responsible for all normal overhead expenses of
managing each Investment Partnership, including compensation for its employees,
rent, utilities, and other such expenses (other than expenses borne by the
Investment Partnership as provided below).

Each Investment Partnership will be responsible for all other expenses of the
Investment Partnership which are not reimbursed by portfolio companies,
including legal, consulting, financing and accounting fees and expenses;
expenses associated with the Investment Partnership’s financial statements, tax
returns and schedules; the costs of liability and other insurance premiums;
out-of-pocket expenses of transactions not consummated; costs associated with
Investment Partnership meetings and mailings; and other expenses associated with
the acquisition, holding and disposition of the Investment Partnership’s
investments, such as legal fees, brokerage and bank fees, fees in connection
with the registration of the Investment Partnership’s securities, and
extraordinary expenses (such as expenses or claims in litigation, if any); its
costs and expenses of interest on borrowed money, real property or personal
property taxes on investments and fees incurred in connection with the
maintenance of bank or custodian accounts; and any taxes, fees or other
governmental charges levied against the Investment Partnership.

 

  9. TRANSFER OF INTERESTS.

No Investor may transfer, pledge, assign, mortgage or otherwise dispose of any
of its interest in an Investment Partnership except with the consent of the
General Partner, provided that no such consent will be required for transfers:
(a) to a successor trustee acting for an Investor, or (b) to any other record
owner where the beneficial owner remains the same.

 

  10. PARTNERSHIP REPORTING.

The General Partner will distribute to the Investors for an Investment
Partnership an annual financial report of the Investment Partnership and an
Investment Partnership tax schedule within 90 days of the close of the
Investment Partnership’s fiscal year. The General Partner may withhold certain
report information from a particular Investor if it determines in good faith
that the withholding of such information is in the best interests of the
Investment Partnership and its Investors and portfolio companies and is intended
to prevent public disclosure of such information.

 

  11. INDEMNIFICATION.

The Investment Partnership will indemnify the General Partner and its members
and their affiliates, solely out of the assets of the Investment Partnership, to
the fullest extent permitted by law and hold them harmless from and in respect
of all claims, liabilities, damages and expenses, including legal fees, to which
they may be or become subject by reason of their activities on behalf of the
Investment Partnership (including service as a member of the board of directors
of any former portfolio company until 12 months after the final sale or
distribution of the securities of such company), so long as the action giving
rise to the claim does not involve conduct not undertaken in good faith or which
is grossly negligent, reckless, intentionally wrongful, or a willful violation
of law.

 

Exhibit A-3

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In the event that the assets of the Investment Partnership (including any
unfunded capital commitments) are insufficient to satisfy any indemnification
obligation, the Investors for such Investment Partnership may be required to
return distributions in cash to the Investment Partnership as necessary to
satisfy such obligation pro rata in accordance with, and to the extent of, the
amount of distributions received within the two-year period immediately
preceding the claim for indemnification.

 

Exhibit A-4