Operating Agreement (2001)Full Document 

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                         MEDCATH OF LITTLE ROCK, L.L.C.

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                               OPERATING AGREEMENT
                                       OF
                         MEDCATH OF LITTLE ROCK, L.L.C.
                   A North Carolina Limited Liability Company


         THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE UNITED STATES
SECURITIES AND EXCHANGE COMMISSION IN RELIANCE UPON AN EXEMPTION FROM SUCH
REGISTRATION SET FORTH IN THE SECURITIES ACT OF 1933 PROVIDED BY SECTION 4
THEREOF, NOR HAVE THEY BEEN REGISTERED WITH THE SECURITIES COMMISSION OF CERTAIN
STATES IN RELIANCE UPON CERTAIN EXEMPTIONS FROM REGISTRATION. THESE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT PURPOSES ONLY AND MAY NOT BE OFFERED WITH THE
TERMS AND CONDITIONS OF THIS AGREEMENT AND IN A TRANSACTION WHICH IS EITHER
EXEMPT FROM REGISTRATION UNDER SUCH ACTS OR PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER SUCH ACTS.


         THIS OPERATING AGREEMENT (the "Agreement") of MedCath of Little Rock,
L.L.C. (the "Company"), a North Carolina Limited Liability Company is made and
entered into as of the 11th day of July, 1995, by and among the Company and
MEDCATH OF ARKANSAS, INC., a North Carolina corporation ("MedCath"), as a Member
and EACH OF THE OTHER PARTIES IDENTIFIED ON SCHEDULE A as Members (THE "INVESTOR
MEMBERS").


                                    RECITALS

         The Company has been formed to develop, own and operate an acute care
hospital which hospital shall be located in or near Little Rock, Arkansas and
shall specialize in all aspects of cardiology and cardiovascular care and
surgery which MedCath and the Investor Manager may agree upon.

                                    ARTICLE I

                                   DEFINITIONS

         As used in this Agreement, the following terms shall have the following
definitions (unless otherwise expressly provided herein).

         1.1      "Affiliate" with respect to a Person, (i) any relative of such
Person; (ii) any officer, director, trustee, partner, manager, employee or
holder of any class of the outstanding voting securities or of an equity
interest of such Person; or (iii) any corporation, partnership, limited
liability company, trust, or any officer, director, trustee, partner, manager,
employee or holder of ten


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percent (10%) or more of the outstanding voting securities or of an equity
interest of any corporation, partnership, limited liability company, trust or
other equity, controlling, controlled by, or under common control with such
Person.

         1.2      "Agreement" shall mean this Operating Agreement, as amended
from time to time.

         1.3      "Articles of Organization." The Articles of Organization of
the Company, as filed with the Secretary of State of North Carolina as the same
may be amended from time to time.

         1.4      "Capital Account" shall mean the amount of any actual or
imputed contribution to the capital of the Company of each of the Members,
including any value specifically assigned to any property or right, tangible or
intangible, contributed by such Member to the capital of the Company, as the
same may be (i) increased from time to time by such Member's share of income and
gains for federal income tax purposes, (ii) decreased from time to time by
distributions to such Member from the Company and by such Member's share of
deductions or losses for Federal income tax purposes, (iii) increased and/or
decreased by those other items required by the Code and the Regulations
thereunder (items described in (i) and (ii) are subject to change from time to
time to comply with the Code and the Regulations), and (iv) upon or in
connection with (1) the liquidation of the Company, (2) a contribution of money
or other property (other than a de minimis amount) to the Company by a new or
existing member as consideration for an interest in the Company, or (3) a
distribution of money or other property (other than a de minimis amount) by the
Company to a retiring or continuing member as consideration for an interest in
the Company, the capital accounts of all Members shall be increased or decreased
to reflect a re-evaluation of all assets of the Company on its books and records
in accordance with the requirements of Treasury Regulation ss.
1.704-1(b)(2)(iv)(f) or any successor regulatory or statutory provision, as of
the date that the event occurs causing the capital accounts to be re-evaluated.
For purposes of computing the amount of any item of income, gain, deduction, or
loss to be reflected in the Member's Capital Accounts, the determination,
recognition, and classification of any such items shall be the same as its
determination, recognition, and classification for Federal income tax purposes

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