FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO.

E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

STATE OF NEW YORK

SUPREME COURT COUNTY OF MONROE

DKBS, LLC, ROBERT C. MORGAN, RICHARD

CROSSED, KENYON CAPITAL HOLDINGS II LLC, and
E. PHILIP SAUNDERS, COMPLAINT

Plaintiffs, Index No.

v.

MARK MURPHY and GREENLIGHT NETWORKS, LLC,

Defendants,
and

FBD & ASSOCIATES, named as a potentially necessary

party under CPLR § 1001.

Plaintiffs, for their Complaint against the Defendants, allege as follows:

PARTIES

1. Plaintiff DKBS, LLC ("DKBS"), with a principal place of business at 280 E.

Broad Street, Rochester, County of Monroe, State of New York, is, and at all times pertinent

was, a domestic limited liability company that as of December 1, 2017, owned 80,000 Class A

Units of Greenlight and 90,000 Class B Units of Greenlight.

2. Plaintiff Robert C. Morgan is, and at all times pertinent was, an individual

residing in the County of Monroe, State of New York and who, as of December 1, 2017, owned

80,000 Class A units of Greenlight.

3. Plaintiff Richard Crossed is, and at all times pertinent was, an individual residing

in the County of Monroe, State of New York and who, as of December 1, 2017, owned 80,000

Class A units of Greenlight.

HARRIS BEACH 5
ATLAW
ATTORNEYS
1 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

(" Capital"
4. Plaintiff Kenyon Capital Holdings II, LLC Kenyon ) is, and at all times

pertinent was, a domestic limited liability company that as of December 1, 2017, owned 80,000

Class A units of Greenlight and has a principal place of business at 180 Canal View Blvd.,

Suite 600, Rochester, County of Monroe, State of New York.

5. Plaintiff E. Philip Saunders is, and at all times pertinent was, an individual

residing in the County of Livingston, State of New York and who, as of December 1, 2017,

owned 80,000 Class A units of Greenlight.

6. Defendant Mark Murphy is, and at all times pertinent was, an individual residing

in the County of Monroe, State of New York and who, as of December 1, 2017, owned 510,000

Class B units of Greenlight and 80,000 Class A Units of Greenlight.

("Greenlight" Company"
7. Defendant Greenlight Networks, LLC or "the ) is, and at

all times pertinent was, a domestic limited liability company engaged in the business of

providing fiber networks used to offer customers Ethernet connections and internet service.

8. FBD &, Associates ("FBD") is, and at all times pertinent was, a domestic

partnership with individual partners residing in the County of Monroe, State of New York and

which, as of December 1, 2017, owned 80,000 Class A units of Greenlight. Plaintiffs have

named FBD as a party solely on grounds that it may have an interest in the issues in and outcome

of this action and may be a necessary party pursuant to CPLR $ 1001(b)(5).

NATURE OF ACTION

9. This is an action seeking declaratory and injunctive relief to several different

ends, the first of which is to enforce a partially performed agreement among the Greenlight

Parties reached on December 22, 2017 to recapitalize Greenlight and partially performed

HARRIS BEACH j
ATTORNEYS
ATLAW
2 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

thereafter through the payment of funds, the acceptance of such funds, and the deposit of such

funds by Defendant Murphy on behalf of Greenlight.

10. The action also seeks declaratory and injunctive relief associated with

enforcement of provisions of Greenlight's governing Operating Agreement and assuring that any

transactions involving the Company and unit owner interests are conducted solely as permitted

by such agreement.

11. Finally, and in the alternative, the action seeks to recover, through the imposition

of a constructive trust on, the benefit Defendant Murphy has negotiated for himself through the

negotiation of a transaction that serves to benefit him to the detriment of Plaintiffs and FBD.

FACTUAL BACKGROUND

12. Greenlight was formed prior to May 30, 2014.

13. On or about May 30, 2014, the Greenlight Parties executed a Second Amended

and Restated Operating Agreement of Greenlight Networks, LLC ("the 2014 Operating

Agreement"
Agreement").

14. The 2014 Operating Agreement contains a number of provisions governing

raising of capital and transactions affecting changes to the Company, its assets, and its

ownership.

15. such provisions is Section which prohibits - absent express

Among 3.5(b),

approval of a Class A Interest - amendment to the 2014 Agreement

Majority any .Operating
Operating

having the following effects:

a. Creation and issuance of any new units;

b. Increase or decrease of the aggregate number of Units, including both Class A and

Class B Units;

3
HARRIS BEACH 5
ATTOANEYS
ATLAW
3 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

c. Effecting an exchange or reclassification of all or part of the Class A Units into

units of a different class;

d. Effecting an exchange or reclassification of units of a different class into Class A

Units;

e. Alteration of the rights, preferences and limitations of all or part of Class A and

Class B Units relative to each other; and/or

f. Alteration/amendment of the provisions of Section 3.5(b)

16. Section 7.2(b) prohibits, so long as there are any Class A Units outstanding, any

of the following actions other than with the prior approval of the Class A Majority in Interest:

a. Acquisition, redemption or purchase of any Units;

b. into a transaction with any Member or any affiliates or related parties of any
Entry

affiliates or related parties of any Member;

c. Change in the Company's business or entry into an unrelated business;

d. Alteration of compensation for the Company's President;

e. Commencement of voluntary proceedings in liquidation or bankruptcy; and/or

f. Entry into an agreement to do one of the above.

Rights,"
17. Section 7.9, which provides for certain "Drag-Along applies to

circumstances where one or more members who together hold a Majority in Interest receive a

bona fide offer from an Independent Third - a defined term one who is not an
Party meaning

Affiliate of a Member and who has no economic relationship with any Member or Affiliate of a

Member - to purchase in a single transaction or series of transactions all of the Company's

outstanding units.

HARRIS BEACH 5
ATTORNEYS
ATLAW
4 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

18. In such circumstance, the Selling Majority Members have the right to require each

other member to participate in the sale in the manner set forth in Section 7.9, which includes the

following terms:

a. Each member dragged along receives an amount of consideration in respect of

such member's units that such member would receive under Section 9.2(c).

GENESIS OF THE DISPUTE

19. Greenlight has since 2013 had principal financing from M&T Bank ("M&T")

under loan terms more specifically appearing in related loan documents.

20. As of December 1, 2017, that loan balance stood at approximately $6 million.

21. Over a period of several years prior to December 1, 2017, Plaintiffs and FBD

extended funds to Greenlight in the form of debt subordinated to support the financing supplied

to the Company by M&T.

22. In or about the beginning of June, 2017, Plaintiffs learned that Greenlight had

default"
entered into what was known as a "leverage with M&T.

23. As of December 2017, Greenlight was in need of operating funds for its next

round of expansion. All Greenlight Parties concurred. In or about May, 2017, the Company's

unit owners began talking about additional funding to support the Company and its growth

strategies. By November 2017, discussion. was centering around the conversion of the

outstanding subordinated debt to (which would necessitate the issuance of additional

equity

units) and the contribution of the additional $2 million as capital, and not as subordinated debt.

24. Following these discussions, ultimately the parties met at the offices of Morgan

Management on December 22, 2017 to negotiate finally the terms of subordinated debt equity

participation as part of a larger recapitalization to inject the new funds for growth and operations,

5
HARRIS BEACHg
ATTORNEYS
ATLAW
5 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

an associated management incentive plan ("MIP") and related concerns as to corporate control

("the December 22 meeting").

25. At the December 22 meeting, the parties negotiated the extent to which

subordinated debt equity participation would occur, evening up of subordinated debt exposure,

the MIP, the extent to which subordinated debt equity participation would dilute Defendant

Murphy's then existing unit ownership were he not to participate in the additional cash infusion,

and the effect these changes would have on Company governance.

2,6. After lengthy and detailed explication of the terms that would govern these

changes in the Company, the Greenlight Parties verbally agreed to detailed terms encompassing

such changes and that such terms would be effective going forward immediately.

27. As a result of the recapitalization, the ownership of units in Greenlight were to

change as follows prior to injection of the $2 million in new capital contributions:

Pre-Recapitalization Post-Recapitalization
Member Class A Class B Overall Class A Class B Overall
Units Units % Units Units %

Murphy 80000 510000 50.862% 80000 510000 31.000%

DKBS 80000 90000 14.655% 203871 90000 15.441%

Crossed 80000 6.897% 203871 10.712%

Morgan 80000 6.897% 203871 10.712%

FBD 80000 6.897% 203871 10.712%

Kenyon 80000 6.897% 203871 10.712%

Saunders 80000 6.897% 203871 10.712%

Total 560000 600000 1303226 600000

28. In reliance on such verbal agreement, Plaintiffs Morgan and Crossed tendered

checks representing their initial pro rata shares of additional contributions, the first in the amount

of $163,786 and the second in the amount of $107,119, respectively. Principals of FBD stated

6
HARRIS BEACH 0
ATTOANEYS
ATLAW
6 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

their intent to tender payment of FBD's pro rata share before the end of the year, and, upon

information and belief, it did so consistent with those expressed intentions.

29. Consistent with such verbal agreement, Defendant Murphy accepted all three

payments on behalf of Greenlight. At no time in connection with the tendered checks did

Defendant Murphy evidence an understanding that no agreement existed, but rather conducted

himself and Greenlight exactly as if the arrangements to which the Greenlight Parties verbally

agreed were in all respects effective.

30. There were no material outstanding items left to negotiate as of December 22,

2017. The agreement permitted Mr. Murphy to contribute funds as well, and he had indicated

that he was going to do so. He later requested that a new investor, Ron Ricotta, be allowed to

purchase his pro rata interest in the new round of equity, which would further reduce Mr.

Murphy's interest in the Company to 26.04%, and that Mr. Ricotta would serve as his appointed

board member after the new transaction closed. Post-closing, Plaintiffs and FBD will have

contributed equity of $4,480,000 and will own 74% of the outstanding Class A and Class B

units, and Defendant Murphy will have contributed equity of $80,000 and own 31% (or 26.04%

to the extent Mr. Ricotta provides Defendant Murphy's pro rata equity contribution) of the

outstanding Class A and Class B units.

31. Thereafter, Gordon Forth, who attended the December 22 meeting on behalf of

FBD, prepared a term sheet intended to set forth elements of the agreement reached at such

meeting and to which the members had stated an intention to be bound.

32. Mr. Forth added to the term sheet a legend noting that comprehensive written

documents would be drawn and that the term sheet was not intended to be an enforceable written

7
HARRIS BEACH E
ATTQANEYs
ATLAw
7 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

agreement, which was not part of the agreement to which the Greenlight Parties intended to be

bound.

33. The agreement reached at the December 22 meeting, as evidenced by the fact that

funds were delivered, accepted and cashed, some even before a term sheet was circulated, was

that it would be effective immediately and that the Company and Greenlight Parties would be

governed in accordance with the new, agreed upon economic arrangements, including those

Governance,"
reflected in the document titled "Employment, Capitalization and which outlined a

Plaintiffs'
number of issues that had been under discussion throughout 2017 and set forth the

position on changes to accommodate the issuance of new Class A Units to effectuate the

recapitalization, changes to the governance of the Company, and the proposed terms of Mr.

Murphy's employment following the Company's restructuring. Following circulation of the

term sheet, Defendant Murphy and his advisor, Mr. Thomas Bonadio, ceased communicating

with Plaintiffs, and efforts to implement the December 22 agreement were either unanswered or

rebuffed.

34. Late in the week of January 30, 2018, Defendant Murphy began contacting

several of the Plaintiffs to inform them that he had reached an agreement with B. Thomas

Golisano under which an entity to be formed by Defendant Murphy and Mr. Golisano would

(a) acquire all of the units of Greenlight, although FBD and Plaintiffs other than DKBS and

Kenyon Capital would be permitted to retain units in the purchaser entity if they so chose; and

(b) pay in full the outstanding subordinated debt, including accrued interest.

35. Defendant Murphy repudiated the agreement to which the Greenlight Parties

agreed to be bound at the December 22 meeting.

HARRIS BEACH 5
ATTORNEYS
ATLAW
8 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

36. On February 5, 2018, Defendant Murphy delivered to Plaintiffs a term sheet

setting forth elements of a proposed transaction between Greenlight and Grand Oaks, a copy of

which term sheet is attached as Exhibit A.

37. Upon information and belief, the business arrangement leading to the formation of

the proposed purchaser provides for Defendant Murphy to hold a greater than 25% equity

interest in the purchaser and for him to manage the acquired business venture.

38. Upon information and belief, Defendant Murphy asserts that he presently controls

greater than a 50% interest in all of the outstanding units of Greenlight and that he therefore may

exercise the Drag-Along Rights set forth in the 2014 Operating Agreement to sell their interests

in the Company to Grand Oaks.

39. Plaintiffs commenced this action to enforce the agreement reached by Plaintiffs

and Defendants at the December 22 meeting, and to prevent Mr. Murphy and Greenlight from

effectuating the proposed transaction with Grand Oaks contrary to the Operating Agreement in

effect. In the agreement reached at the December 22 meeting, Mr. Murphy gave up his majority

ownership of outstanding units and lacks sufficient ownership interest to unilaterally sell the

Company. Furthermore, even if Mr. Murphy still held a majority interest, he is not permitted to

move forward with the proposed transaction absent consent by the majority of Class A Unit

holders. Plaintiffs are unwilling to yield their investments in Greenlight on the terms Defendant

Murphy seeks to impose and seek to prevent him from forcing a transaction that is more

favorable to him while freezing Plaintiffs out through merger.

FIRST CAUSE OF ACTION

40.. Upon information and belief, upon reaching of the agreement on December 22

and the implementation of a portion of that agreement through tender, receipt and deposit of

HARRIS BEACH 5
ATTORNEYS
ATLAW
9 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

associated funds, Plaintiffs and FBD obtained equitable ownership of additional Membership

Interests in the Company, and to the additional units to be issued by Greenlight reflecting those

Plaintiffs'
interests, in return for tender of the additional $2 million of capital.

41. Upon information and belief, because of such agreement, because at least two

such Plaintiffs already tendered funds, and because the other Plaintiffs remain ready, willing and

able to tender their respective funds, Plaintiffs are owners, legal and equitable, of 69% of the

outstanding units of Greenlight.

42. Upon information and belief, as a result of the agreement reached at the

December 22 meeting, Defendant Murphy no longer controls a majority interest in Greenlight.

43. Defendant Murphy has repudiated and thereby breached the agreement reached at

the December 22 meeting and sought a new partner with whom he would continue in the

business while excluding the Plaintiffs from it.

44. Upon information and belief, Plaintiffs will be irreparably harmed if the

agreement reached at the meeting of December 22 is not specifically enforced in accordance with

the terms of such agreement. Specifically, Plaintiffs will lose the benefit of no longer being in

the minority, they will lose their newly acquired protections from being forced out by a majority

position, and potentially they will lose their interests in a successful enterprise they helped build.

45. Plaintiffs seek relief declaring that in return for the respective contributions to

which the parties agreed as additional capital contributions (two of which contributions already

have been tendered, accepted and deposited),

a. Each Plaintiff shall receive 123,871 additional Class A Units;

b. Effective as of December 22, 2017, Plaintiffs and FBD collectively controlled 69

percent of the outstanding units of Greenlight;

10
HARRIS BEACH 5
ATLAW
ATTORNEYS
10 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

c. At the completion of the contemplated transaction(s); Defendant Murphy shall

have 510,000 Class B Units and 80,000 Class A Units constituting 31% of all

outstanding units of Greenlight (unless Mr. Ricotta becomes an investor in place

of Mr. Murphy's contribution of $620,000 in new financing, at which time Mr.

Murphy's ownership interest would constitute 26.04%); and

d. Until such transaction(s) have been completed, Plaintiffs are the equitable owners

of the additional Class A Units to which they are to become entitled, and

Defendant Murphy shall have no right or capacity to transfer to any other person

any greater percentage interest in Greenlight.

46. Plaintiffs seek injunctive relief, whether by permanent injunction, preliminary

injunction and/or temporary restraining order, directing the completion of the transaction(s) to

which the Greenlight Parties agreed and as described above.

47. Plaintiffs also seek injunctive relief, whether by permanent injunction,

preliminary injunction and/or temporary restraining order, enjoining Defendants from conducting

the business of the Company, entering into or consummating any agreements, or otherwise

acting on behalf of the Company other than as a 31% equitable owner of interests (or 26.04% to

I
the extent Mr. Ricotta provides Mr. Murphy's $620,000 pro rata equity contribution) in

accordance with the 2014 Operating Agreement.

SECOND CAUSE OF ACTION

48. Regardless of the percentage of outstanding units of Greenlight Defendant

Murphy may control, the proposed transaction with Grand Oaks set forth in the term sheet

attached hereto as Exhibit A violates express restrictions in the 2014 Operating Agreement.

HARRIS BEACH 5
ATTORNEYS
ATLAW
11 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

49. As noted above, Section 7.2(b) of the 2014 Operating Agreement prohibits, so

long as there are any Class A Units outstanding, any of the following actions other than with the

prior approval of the Class A Majority in Interest:

a. Acquisition, redemption or purchase of any Units;

b. Entry into a transaction with any Member or any affiliates or related parties of any

affiliates or related parties of any Member

Rights"
50. Further, Section 7.9 provides for certain "Drag-Along which arise in

circumstances where one or more members who together hold a Majority in Interest receive a

"bona fide offer from an Independent Third Party to purchase in a single transaction or series of

units."
transactions all of the Company's outstanding

51. Plaintiffs constitute the Class A Majority in Interest as a result of their ownership

of more than two thirds of the outstanding Class A Units.

52. The foregoing restrictions serve to protect the Class A Unit owners from the

otherwise unconstrained authority of Defendant Murphy, who in May 2014 controlled a greater

than 50% interest in all the Company's outstanding units, to make arrangements to flush them

from the business on terms disproportionately benefiting himself and permitting him, without

their consent, to substitute others as his partner(s) in the business.

53. Upon information and belief, the proposed purchaser identified in the term sheet

Party"
attached as Exhibit A is not an "Independent Third as that term is defined in the 2014

Party"
Operating Agreement, which states that an "Independent Third is "not an Affiliate of any

Member" Member."
and "has no economic relationship with any Member or any Affiliate of a

54. Upon information and belief, the proposed purchaser, whether currently or by

proposed step transaction, has an economic relationship with Defendant Murphy.

12
HARRIS BEACH 5
ATTORNEYS
ATLAW
12 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

offer"
55. Upon information and belief, such offer is not a "bona fide to the extent

that it may involve efforts to hide Defendant Murphy's eventual planned involvement in ongoing

business currently conducted by Greenlight.

56. Upon information and belief, the proposed purchaser is an affiliate of Defendant

"Affiliate"
Murphy, whether presently or by proposed step transaction, within the definition of

set forth on page 2 of the 2014 Operating Agreement.

57. By reason of the foregoing, Section 7.2(b) of the 2014 Operating Agreement

forecloses the transaction proposed in the term sheet attached hereto as Exhibit A absent

affirmative support of a Class A Majority in Interest, which here is lacking as a result of

Plaintiffs'
objections.

58. By reason of the foregoing, Section 7.9 of the 2014 Operating Agreement does

Rights"
not provide for "Drag-Along with respect to the transaction proposed in the term sheet

attached hereto as Exhibit A, and such transaction may not proceed. Plaintiffs seek relief

declaring that the 2014 Operating Agreement prevents the transaction proposed in the term sheet

attached hereto as Exhibit A absent (a) consent of a Class A Majority in Interest under

Section 7.2(b) of the 2014 Operating Agreement, and (b) Section 7.9 does not afford Drag-Along

Rights with respect to the transaction proposed by the term sheet attached as Exhibit A.

59. Plaintiffs also seek relief enjoining and restraining, effective immediately, and

whether by permanent injunction, preliminary injunction and/or temporary restraining order, the

transaction proposed by the term sheet attached hereto as Exhibit A and delivered by Defendant

Murphy on February 5, 2018.

13
HARRIS BEACH 5
ATTORNEYS
ATLAW
13 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

THIRD CAUSE OF ACTION

60. Upon information and belief, Defendant Murphy has delivered the term sheet

attached hereto as Exhibit A purportedly in attempted compliance with the provisions of

Section 7.9 of the 2014 Operating Agreement and with the purpose of invoking the procedures

and requirements of such section to effectuate a closing with Grand Oaks.

61. As alleged above, the proposed transaction, even if it were a legally binding offer,

would not be a bona fide offer from an Independent Third Party within the meaning of

Section 7.9(a), which is a necessary condition to invoke the provisions of Section 7.9.

62. Plaintiffs further assert that Defendant Murphy has failed in other respects to

conform with the provisions of Section 7.9.

63. Section 7.9(b) establishes certain notice requirements with respect to invoking the

Drag-Along Rights set forth in Section 7.9, including the following:

a. A copy of any form of definitive agreement(s) proposed to be executed in

connection with such transaction;

b. All material terms and conditions of the transaction;

c. A description of any non-cash consideration involved in the transaction; and

d. The proposed date, time and location of the closing of the sale.

64. Upon information and belief, the notice, including the term sheet, delivered by

Defendant Murphy fails to provide each of the foregoing elements of required notice, and most

notably the proposed definitive agreements associated with the proposed transaction.

65. Section 7.9(e) provides among other requirements for pro rata, and not joint,

indemnities, limitations on indemnities to the amount of consideration received by the Selling

Majority Member.

HARRIS BEACH 5
ATTQRNEYs
ATLAw
14 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

66. Upon information and belief, the term sheet attached hereto as Exhibit A and

notice provided by Defendant Murphy fails to comply with such requirement.

67. The term sheet attached hereto as Exhibit A does not reflect the willingness of the

purchaser to accept indemnities limited as set forth in Section 7.9(e) of the 2014 Operating

Agreement.

68. Upon information and belief, the failure of the materials delivered on February 5,

2018 to set forth these required elements of what Defendant Murphy characterizes as the

proposed transaction render such notice defective.

69. Upon information and belief, as a result of the defects in the purported notice

delivered by Defendant Murphy, Plaintiffs have no obligation to address it or respond to it, and

their failure and refusal to do so holds no consequence to them and their rights under the 2014

Operating Agreement.

70. Plaintiffs ask relief declaring that the purported notice delivered by Defendant

Murphy is defective and without legal significance and that failure to respond to it or to take

Plaintiffs'
steps under Section 7.9 of the 2014 Operating Agreement impairs none of rights under

such agreement.

71. Plaintiffs also seek injunctive relief, whether by permanent injunction,

preliminary injunction and/or temporary restraining order, enjoining and restraining Defendants

Greenlight and Murphy from proceeding with the proposed transaction.

72. Alternatively, Plaintiffs ask that the Court impose a constructive trust on the

consideration to be paid by Grand Oaks in connection with the proposed transaction until such

time as the respective rights to such consideration have been determined.

15
HARRIS BEACH 0
ATTORNEYS
ATLAW
15 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

WHEREFORE, for the reasons set forth herein, Plaintiffs respectfully request this Court

to issue an Order:

a. Declaring that the December 22, 2017 agreement between the parties was valid

and enforceable and that the respective ownership interests of the Greenlight

Parties are as were agreed to be in that agreement, and directing the

they

completion of the transaction(s) to which the Greenlight Parties agreed on

December 22, 2017;

b. Enjoining and restraining, effective immediately, and whether by permanent

injunction, preliminary injunction and/or temporary restraining order, the

transaction proposed by the term sheet attached hereto as Exhibit A and delivered

by Defendant Murphy on February 5, 2018;

c. Granting injunctive relief, whether by permanent injunction, preliminary

injunction and/or temporary restraining order, enjoining and restraining

Defendants Greenlight and Murphy from taking any action that an owner of a

minority interest may not take on behalf of Greenlight pursuant to the 2014

Operating Agreement;

d. Alternatively, and only in the event the Court declines to grant the relief requested

above, imposing a constructive trust and/or equitable lien on the benefit

Defendant Murphy has negotiated for himself through the transaction proposed by

the term sheet attached hereto as Exhibit A and delivered by Defendant Murphy

on February 5, 2018 that serves to benefit him to the detriment of Plaintiffs and

FBD; and

e. Granting such other and further relief as the Court may deem just and proper.

16
HARRIS BEACH 0
ATTORNEYS
ATLAW
16 of 17
FILED: MONROE COUNTY CLERK 02/20/2018 03:57 PM INDEX NO. E2018000947
NYSCEF DOC. NO. 2 RECEIVED NYSCEF: 02/20/2018

Dated: February 2 , 2018

Pittsford, New York

HARRIS BEACH PLLC

Douglas A. os's

David J. Edwards
Svetlana K. Ivy
Kara E. Stoddart

Attorneys for Plaintiffs

99 Garnsey Road

Pittsford, New York 14534

(585) 419-8697
dfoss@harrisbeach.com
sivy@harrisbeach.com
dedwards@harrisbeach.com
kstoddart@harrisbeach.com

2942003308398v6

17
HARRIS BEACH 5
ATTORNEYS
ATLAW

17 of 17