Operating Agreement (NY)

OPERATING AGREEMENT

(New York Limited Liability Company — Multi-Member, Manager-Managed)

This Operating Agreement (this “Agreement”) of [company legal name], a New York limited liability company (the “Company”), is entered into and effective as of [effective date] (the “Effective Date”), by and among the Company and the persons listed as Members on Schedule I (each, a “Member”, and collectively, the “Members”). Capitalized terms not otherwise defined in this Agreement have the meanings set forth in Section 21 (Definitions).

RECITALS

WHEREAS, the Company was formed as a limited liability company under the New York Limited Liability Company Law (the “NY LLCL”) by the filing of Articles of Organization with the New York Department of State on [articles of organization filing date];

WHEREAS, the Members wish to set forth their rights and obligations with respect to the Company, the management of its business, and the relationships among the Members; and

NOW, THEREFORE, in consideration of the mutual covenants set forth in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are acknowledged, the parties agree as follows:

1. ORGANIZATIONAL MATTERS

1.1 Name. The Company's legal name is [company legal name]. The Company may operate under the trade name(s) [trade names] as approved by the Manager from time to time.

1.2 Principal Office. The Company's principal office is located at [principal office address], or such other location in New York as the Manager may designate from time to time. The Manager will give prompt notice of any change of office to each Member.

1.3 Registered Office and Registered Agent. The Company's registered agent for service of process in New York, and the Company's registered office, is [registered agent name and address], as named in the Articles of Organization or such other agent or office as the Manager may designate in the manner provided by the NY LLCL.

1.4 Purpose. The Company's purpose is to engage in any lawful business activity for which a limited liability company may be formed under the NY LLCL, and to engage in any and all activities necessary or incidental to that purpose.

1.5 Term. The Company's term commenced on the date the Articles of Organization were filed with the New York Department of State and continues perpetually until the Company is dissolved in accordance with Section 20 (Dissolution and Winding Up) or as otherwise required by law.

1.6 Limited Liability of Members. Except as expressly required by the NY LLCL or other Applicable Law, no Member is personally liable for any debt, obligation, or liability of the Company solely by reason of being a Member.

2. MEMBERS AND CAPITAL

2.1 Members and Membership Interests. The Members, their addresses, initial Capital Contributions, and Membership Interests (expressed as percentages or units) are set forth on Schedule I (the “Members Schedule”). The Manager will update the Members Schedule from time to time to reflect changes permitted by this Agreement, and any updated Members Schedule will be the operative one without further amendment to this Agreement.

2.2 Initial Capital Contributions. Each Member has made (or will make) the initial Capital Contribution shown for that Member on the Members Schedule. Capital Contributions may consist of cash, property, services rendered or to be rendered, or a promissory note, as agreed and reflected on the Members Schedule.

2.3 No Additional Capital Contributions. No Member is required to make any additional Capital Contribution. Additional Capital Contributions may be accepted only with Member approval under Section 7 (Major Decisions Requiring Member Approval). No Member is entitled to interest on any Capital Contribution or Capital Account balance.

2.4 Loans by Members. If a Member advances money to the Company, the advance will be treated as a loan (and not as an additional Capital Contribution) only if it is documented in writing as a loan with interest, repayment, and other commercial terms approved under Section 7. Loans from Members are debts of the Company, do not entitle the Member to any additional Membership Interest, and rank with other unsecured Company creditors unless otherwise agreed in writing.

2.5 Capital Accounts. The Company will establish and maintain a separate capital account for each Member (each, a “Capital Account”) in accordance with Section 704(b) of the Code and Treasury Regulations Section 1.704-1(b)(2)(iv). Each Capital Account will be increased by that Member's Capital Contributions and allocated profits, and decreased by distributions to that Member and allocated losses. On a Transfer of Membership Interests permitted by this Agreement, the Transferee succeeds to the corresponding portion of the Transferor's Capital Account.

2.6 No Withdrawal of Capital. No Member may withdraw any portion of its Capital Account or receive any distribution from the Company except as expressly provided in this Agreement. If a Member has a deficit balance in its Capital Account, that Member is not obligated to restore the deficit or make any further Capital Contribution to eliminate the deficit, except as required by Applicable Law.

2.7 No Certification of Membership Interests. Membership Interests are uncertificated unless the Manager elects to issue certificates evidencing them. If certificates are issued, they will bear the legends required by Section 8 (Transfer Restrictions and Permitted Transfers) and applicable securities laws.

3. ADMISSION OF ADDITIONAL MEMBERS

3.1 When New Members May Be Admitted. Additional Members may be admitted only in connection with (a) an issuance of Membership Interests by the Company approved under Section 7, or (b) a Transfer of Membership Interests permitted under Section 8 (Transfer Restrictions and Permitted Transfers). In each case, admission is subject to Section 3.2.

Option A — Joinder: 3.2 Conditions to Admission (Joinder). To be admitted as a Member, any person not already a Member must execute and deliver to the Company a joinder agreement in substantially the form attached as Exhibit B (the “Joinder Agreement”). On execution of the Joinder Agreement, payment of any required consideration, and any update to the Members Schedule by the Manager, that person becomes a Member, is bound by this Agreement as if originally a party, and is deemed listed as such on the Company's books.

Option B — Amend and Restate: 3.2 Conditions to Admission (Amend and Restate). To be admitted as a Member, any person not already a Member must execute a counterpart signature page to an amended and restated version of this Agreement reflecting that admission. On execution and delivery of that signature page, payment of any required consideration, and any update to the Members Schedule by the Manager, that person becomes a Member and is bound by this Agreement as so amended and restated.

3.3 Capital Account Adjustments. The Manager will adjust the Capital Accounts of the existing Members as required by Treasury Regulations Section 1.704-1(b)(2)(iv)(f) on the admission of any new Member, including by booking up Company assets to fair market value if the Manager determines such adjustment is necessary or appropriate to reflect the relative economic interests of the Members.

4. WITHDRAWAL, DEATH, AND EXPULSION

4.1 No Voluntary Withdrawal. So long as a Member holds any Membership Interest, that Member may not withdraw, resign, or otherwise terminate its membership prior to the dissolution and winding up of the Company, and any attempted withdrawal is null and void. A Member ceases to be a Member only when it no longer holds any Membership Interest.

4.2 Death of a Member. The death of a Member does not dissolve the Company. The deceased Member's Membership Interest is automatically Transferred to that Member's executors, administrators, testamentary trustees, legatees, or beneficiaries (each, a “Successor”), and any Successor seeking to be admitted as a Member must comply with Section 3.2. Until admitted as a Member, a Successor holds only the deceased Member's economic rights (rights to allocations and distributions) and has no voting, management, or information rights.

4.3 Death of the Last Member. On the death of the last remaining Member, the Company is wound up unless, within [successor continuation window in days] days following that Member's death, the legal representative of the deceased Member agrees in writing to continue the Company and either to become a Member or to designate another person who agrees in writing to become a Member, in each case effective as of that Member's death.

Option A — No Expulsion: 4.4 No Expulsion. No Member may be expelled from the Company. The Members' remedies for any wrongful conduct by another Member are governed by Applicable Law and any other agreement among the parties.

Option B — Expulsion Permitted: 4.4 Expulsion. A Member may be expelled from the Company by the unanimous written consent of all other Members (excluding the Member to be expelled) if that Member (a) materially breaches this Agreement and fails to cure the breach within [cure period in days] days after written notice of the breach; or (b) commits fraud, theft, embezzlement, or gross negligence against the Company or another Member. On expulsion, the expelled Member ceases to be a Member, retains only the economic rights of an assignee with respect to its Membership Interest (no voting or management rights), and the Company has the option, but not the obligation, to purchase the expelled Member's Membership Interest at fair market value as determined under [expulsion buyout valuation method].

5. MEETINGS AND ACTION OF MEMBERS

5.1 Annual and Special Meetings. Meetings of the Members will be held annually for the purpose of transacting any business that comes before the meeting. Special meetings may be called by (a) the Manager, or (b) any Member or group of Members holding more than [special meeting call threshold percentage]% of the Membership Interests.

5.2 Notice. Written notice stating the place, date, and time of each meeting, and (in the case of a special meeting) the purposes for which the meeting is called, must be delivered not fewer than [minimum meeting notice days] days and not more than [maximum meeting notice days] days before the date of the meeting to each Member. Attendance at a meeting waives notice except where a Member attends solely to object to the lawful calling or convening of the meeting.

5.3 Remote Participation. Any Member may participate in a meeting by conference telephone, videoconference, or other communications equipment by which all participants can hear each other simultaneously. Participation by such means constitutes presence in person at the meeting.

5.4 Proxies. On any matter to be voted on by the Members, a Member may vote in person or by proxy. A proxy may be granted in writing or by Electronic Transmission and is revocable in the discretion of the Member granting it unless the proxy expressly states that it is irrevocable.

5.5 Quorum and Voting. A quorum at any meeting of the Members requires the presence (in person or by proxy) of Members holding a majority of the Membership Interests entitled to vote. Subject to Section 7 and any other provision of this Agreement requiring a different threshold, no action may be taken at a meeting without the affirmative vote of Members holding at least a majority of the Membership Interests entitled to vote on the matter.

5.6 Action by Written Consent. Any action that may be taken at a meeting of the Members may be taken without a meeting if a written consent setting forth the action is signed by Members holding not less than the minimum Membership Interests that would be required to authorize the action at a meeting at which all Members entitled to vote were present and voting. The consent may be signed in counterparts and by Electronic Transmission. The Manager will give prompt notice to any Member who did not consent in writing of any action approved by less than all Members.

6. MANAGEMENT BY MANAGER

6.1 Manager. The business, property, and affairs of the Company will be managed exclusively by one or more managers (each, a “Manager”). The initial Manager is [initial manager name]. The Manager need not be a Member.

6.2 Authority of Manager. Subject to Section 7 (Major Decisions Requiring Member Approval) and except as otherwise provided in the NY LLCL or this Agreement, the Manager has full power and authority to manage the Company's business, including to enter into contracts, hire employees and engage advisors, open and operate bank accounts, file tax returns, and take any other action necessary or appropriate to carry out the Company's purpose. Actions taken by the Manager in accordance with this Agreement bind the Company.

6.3 No Member Authority. Except as expressly authorized by the Manager in writing or as otherwise required by this Agreement or the NY LLCL, no Member (other than a Member acting in its capacity as Manager) has the authority to act on behalf of, or to bind, the Company.

6.4 Officers. The Manager may appoint individuals as officers of the Company (each, an “Officer”) with such titles, authority, and duties as the Manager determines. An Officer need not be a Member. Officers serve at the pleasure of the Manager and may be removed at any time, with or without cause. A vacancy in any office may, but need not, be filled by the Manager.

6.5 Manager Compensation. The Manager will be entitled to [manager compensation description] for services as Manager, and will be reimbursed for reasonable out-of-pocket expenses incurred on behalf of the Company. Other compensation arrangements between the Manager and the Company must be approved under Section 7 if they would constitute a Major Decision.

6.6 Removal and Resignation of Manager. The Manager may be removed at any time, with or without cause, by the affirmative vote of Members holding at least [manager removal threshold percentage]% of the Membership Interests. The Manager may resign at any time by delivering a written resignation to the Company, effective on receipt unless the resignation specifies a later effective date or event. Following any removal or resignation, a successor Manager will be elected by the affirmative vote of Members holding at least [manager election threshold percentage]% of the Membership Interests. Removal of the Manager does not affect the Manager's rights as a Member.

7. MAJOR DECISIONS REQUIRING MEMBER APPROVAL

7.1 Approval Threshold. Without the prior written approval of Members holding at least [major decision approval threshold] of the Membership Interests (a “Major Decision Approval”), and subject to any provision of the NY LLCL requiring approval by a different percentage or by particular Members, the Company may not, and may not commit to, take any of the actions in Section 7.2.

7.2 Major Decisions. Each of the following is a “Major Decision” requiring Major Decision Approval:

(a) amending, modifying, or waiving any provision of this Agreement or the Articles of Organization, except that the Manager may update the Members Schedule to reflect changes in ownership permitted under this Agreement;

(b) issuing additional Membership Interests, Equity Securities, or other securities of the Company, or admitting additional Members (other than in connection with a Permitted Transfer);

(c) incurring indebtedness, granting Liens on Company assets, or guaranteeing the obligations of any other person, in excess of $[single transaction debt limit] in any single transaction or series of related transactions, or in excess of $[aggregate outstanding debt limit] in the aggregate at any time outstanding;

(d) making any loan, advance, capital contribution, or investment in any other person in excess of $[investment approval threshold];

(e) acquiring, by merger, consolidation, asset purchase, or otherwise, all or substantially all the assets or equity of any other person, other than in the ordinary course of business consistent with past practice;

(f) selling, leasing, licensing, or otherwise disposing of all or substantially all the assets of the Company, or merging, converting, or reorganizing the Company;

(g) settling any lawsuit, arbitration, or other proceeding involving payment by or to the Company in excess of $[litigation settlement threshold], or any settlement that involves equitable relief affecting Company operations;

(h) approving the Company's annual operating budget and any single line-item expense materially in excess of the budget;

(i) entering into, amending, or terminating any Related-Party Transaction (as defined in Section 19);

(j) changing the Company's federal income tax classification under Treasury Regulations Section 301.7701-3 (e.g., electing to be taxed as a corporation or making an S corporation election);

(k) dissolving, winding up, or liquidating the Company, or commencing any voluntary bankruptcy or insolvency proceeding involving the Company; and

(l) taking any other action that, under the NY LLCL, requires Member approval.

Option A — Unanimous: Set the Major Decision Approval Threshold to “all Members” or “100%” so that every Major Decision requires unanimous Member approval.

Option B — Supermajority: Set the Major Decision Approval Threshold to a percentage greater than 50%, typically “66 2/3%” or “75%”, so that a supermajority of Membership Interests is required.

8. TRANSFER RESTRICTIONS AND PERMITTED TRANSFERS

8.1 General Restriction. Except for a Permitted Transfer under Section 8.4, no Member may Transfer all or any portion of its Membership Interest without the prior written consent of Members holding at least [transfer approval threshold percentage]% of the Membership Interests (excluding the Membership Interest of the Transferring Member). No Transfer to a person not already a Member is complete until the Transferee is admitted as a Member in accordance with Section 3.2.

8.2 Securities, Tax, and Regulatory Restrictions. Notwithstanding any other provision of this Agreement, no Transfer of Membership Interests, and no issuance of Membership Interests by the Company, may be made or completed if it would:

(a) violate the Securities Act of 1933, as amended, or any applicable state securities (“blue sky”) law, and, in the case of a Transfer, the Transferring Member must (if requested by the Manager) deliver an opinion of counsel reasonably acceptable to the Company that the Transfer is exempt from registration;

(b) cause the Company to be treated as a “publicly traded partnership” under Section 7704(b) of the Code, including by exceeding the safe harbors of Treasury Regulations Section 1.7704-1;

(c) cause the Company to lose its classification as a partnership for U.S. federal income tax purposes (in the case of a Company taxed as a partnership);

(d) cause the Company to be required to register as an investment company under the Investment Company Act of 1940;

(e) cause the assets of the Company to be deemed “plan assets” under the U.S. Department of Labor regulations at 29 C.F.R. Section 2510.3-101 or result in a “prohibited transaction” under ERISA or Section 4975 of the Code; or

(f) cause the Company to lose its qualification to do business as a limited liability company under the NY LLCL or other Applicable Law.

8.3 Effect of Prohibited Transfer. Any Transfer or attempted Transfer in violation of this Agreement is null and void. The purported Transferor will continue to be treated as the holder of the Membership Interest, and the Company will not record the Transfer on its books.

8.4 Permitted Transfers. The following Transfers are “Permitted Transfers” and are not subject to the consent requirement in Section 8.1, but remain subject to Section 8.2 and to the admission requirements in Section 3.2:

(a) a Transfer by a Member that is an entity to an Affiliate of that Member;

(b) for a Member that is an individual, a Transfer to (i) the Member's spouse, parent, sibling, descendant (including by adoption or step-relationship), or the spouse of any of them (collectively, “Family Members”); (ii) a trust under which the Membership Interests are distributable only to the Member and/or one or more Family Members of the Member; (iii) a charitable remainder trust the income from which is paid to the Member during the Member's life; (iv) a corporation, partnership, or limited liability company all of whose owners are the Member and/or Family Members of the Member; or (v) on the Member's death, the Member's executor, administrator, testamentary trustee, legatee, or beneficiary by will or under the laws of intestate succession; and

(c) any other Transfer expressly designated as a Permitted Transfer in this Agreement or approved as a Permitted Transfer by Major Decision Approval.

8.5 Right of First Refusal. If a Member (the “Offering Member”) receives a bona fide written offer from a third party to purchase all or any portion of its Membership Interest (other than in a Permitted Transfer), the Offering Member must first offer to sell that Membership Interest to (a) the Company and (b) the other Members on the same price and terms set forth in the third-party offer. The Company has [company rofr exercise period in days] days from receipt of the Offering Member's notice to elect to purchase, and on the Company's failure to elect, the other Members have an additional [member rofr exercise period in days] days, exercisable pro rata in proportion to their Membership Interests (with reallocation among electing Members of any portion declined). If neither the Company nor the other Members elects to purchase the full offered Membership Interest within those periods, the Offering Member may sell to the third party on the original terms within [rofr sale window in days] days, and any sale not completed within that window resets the right of first refusal.

8.6 Involuntary Transfers. If all or any portion of a Member's Membership Interest becomes subject to (a) bankruptcy or insolvency of that Member, (b) a divorce decree, equitable distribution order, or property settlement, or (c) a creditor charging order, levy, or other involuntary process (each, an “Involuntary Transfer Event”), the Company has the option (and on the Company's failure to exercise, the other Members have the option, pro rata) to purchase the affected Membership Interest at [involuntary transfer buyout price method], exercisable by written notice to the affected Member within [involuntary transfer exercise period in days] days after the Company first learns of the Involuntary Transfer Event. Until purchased or otherwise resolved, the holder of the affected Membership Interest by reason of the Involuntary Transfer Event has only economic rights of an assignee and no voting, management, or information rights.

9. ALLOCATIONS OF PROFITS AND LOSSES

9.1 Pro Rata Allocations. For each Fiscal Year, the Company's profits and losses (and items of income, gain, loss, deduction, and credit) will be allocated to the Members pro rata in proportion to their respective Membership Interests, except as required by Section 9.2.

9.2 Required Tax Allocations. Notwithstanding Section 9.1, the following allocations are required by Treasury Regulations under Section 704(b) of the Code and apply before the pro rata allocations in Section 9.1:

(a) “partner nonrecourse deductions” (as defined in Treasury Regulations Section 1.704-2(i)) are allocated to the Member that bears the economic risk of loss for the related liability;

(b) “nonrecourse deductions” (as defined in Treasury Regulations Section 1.704-2(b)) and “excess nonrecourse liabilities” (as defined in Treasury Regulations Section 1.752-3(a)) are allocated to the Members in proportion to their Membership Interests; and

(c) this Agreement is deemed to include “qualified income offset,” “minimum gain chargeback,” and “partner nonrecourse debt minimum gain chargeback” provisions within the meaning of Treasury Regulations under Section 704(b) of the Code.

9.3 Tax Allocations Conform to Book Allocations. Items of income, gain, loss, deduction, and credit of the Company are allocated among the Members for federal, state, and local income tax purposes consistent with the corresponding book allocations under this Section 9, except as otherwise required by the Code or Treasury Regulations.

10. DISTRIBUTIONS AND TAX DISTRIBUTIONS

10.1 Operating Distributions. The Company may make distributions of available cash to the Members at the times and in the amounts determined by the Manager, subject to maintaining reasonable working capital reserves and to Section 10.3. Operating distributions will be made to the Members pro rata in proportion to their Membership Interests.

10.2 Tax Distributions. Within [tax distribution cadence in days] days after the end of each fiscal quarter (and as needed to enable Members to make federal estimated tax payments), the Company will use commercially reasonable efforts to distribute to each Member an amount in cash (each, a “Tax Distribution”) equal to (a) the cumulative net taxable income allocated to that Member through the end of the relevant period, multiplied by (b) [assumed combined tax rate percentage]% (the assumed combined federal, New York State, and applicable local tax rate), less any prior Tax Distributions to that Member for that Fiscal Year. Tax Distributions are subject to the Manager's good-faith determination that the Company has cash available consistent with reasonable working capital needs and Applicable Law, and any Tax Distribution made to a Member is treated as an advance against, and reduces, the next operating distribution otherwise payable to that Member under Section 10.1.

10.3 Distribution Test. No distribution may be made if, after giving effect to the distribution, (a) the Company would be unable to pay its debts as they become due in the ordinary course of business, or (b) the fair value of the Company's total assets would be less than the sum of its total liabilities (other than liabilities to Members on account of their Membership Interests). This Section 10.3 reflects the distribution test in NY LLCL Section 508.

11. EXCULPATION AND INDEMNIFICATION

11.1 Exculpation. To the fullest extent permitted by the NY LLCL, no Manager, Officer, or Member (each, a “Covered Person”) will be liable to the Company or any other Member for monetary damages for any act or omission performed or omitted in connection with the Company's business, except for liability arising from (a) acts of bad faith or active and deliberate dishonesty material to the cause of action, (b) any transaction in which the Covered Person personally gained a financial profit or other advantage to which the Covered Person was not legally entitled, or (c) any other matter for which exculpation is not permitted under the NY LLCL.

11.2 Indemnification. To the fullest extent permitted by NY LLCL Section 420, the Company will indemnify each Covered Person, and reimburse the Covered Person for any reasonable expenses (including reasonable attorneys' fees), losses, claims, damages, judgments, fines, and amounts paid in settlement (collectively, “Losses”), in each case actually and reasonably incurred in connection with any threatened, pending, or completed action, suit, or proceeding, by reason of the Covered Person's status as such or any act or omission in that capacity, except (a) for liability arising from the matters described in clauses (a) through (c) of Section 11.1, or (b) as otherwise prohibited by the NY LLCL.

11.3 Advancement of Expenses. On receipt of a written undertaking by or on behalf of the Covered Person to repay the advanced amounts if it is finally judicially determined that the Covered Person is not entitled to indemnification under this Agreement, the Company will advance reasonable legal and other expenses to the Covered Person on a current basis as incurred in connection with any matter covered by Section 11.2.

11.4 Source of Indemnification; No Personal Liability. Indemnification and advancement under this Section 11 will be paid solely out of the assets of the Company. No Member or other person has any personal liability for any indemnification or advancement obligation. The Manager may, in its discretion, cause the Company to maintain insurance covering the indemnification and advancement obligations under this Section 11.

11.5 Survival; Non-Exclusivity. The exculpation and indemnification provisions of this Section 11 survive any Transfer of Membership Interests, the resignation or removal of any Covered Person, and the dissolution of the Company. The rights provided in this Section 11 are in addition to, and not exclusive of, any other rights to which a Covered Person may be entitled under any agreement, by vote of the Members, or otherwise.

12. INSPECTION RIGHTS; BOOKS AND RECORDS

12.1 Books and Records. The Company will keep complete and accurate books and records of its business and affairs, including (a) a current Members Schedule, (b) copies of the Articles of Organization and this Agreement (and all amendments), (c) financial statements and federal, state, and local tax returns and information returns for each Fiscal Year, and (d) records of material contracts entered into by the Company. The Company's books and records will be maintained in accordance with the NY LLCL and Treasury Regulations applicable to partnerships.

12.2 Inspection by Members. On reasonable written notice and during normal business hours, each Member (or its authorized representative) may, at the Member's expense, examine and copy the books and records of the Company described in Section 12.1, in each case for a purpose reasonably related to that Member's interest as a Member. The Manager may impose reasonable confidentiality restrictions and may withhold from inspection (a) trade secrets and (b) information the Manager determines in good faith should be kept confidential to protect the Company's commercial interests, in each case to the extent permitted by the NY LLCL.

13. INCOME TAX STATUS

13.1 Default Partnership Classification. It is the intent of the Company and the Members that the Company be classified as a partnership for U.S. federal, state, and local income tax purposes. Neither the Company, the Manager, nor any Member will make any election under Treasury Regulations Section 301.7701-3 to have the Company classified as other than a partnership without obtaining a Major Decision Approval.

13.2 Partnership Audit Rules. The Members acknowledge that the Company is subject to the centralized partnership audit procedures enacted by the Bipartisan Budget Act of 2015 and codified at Sections 6221 through 6241 of the Code (the “BBA Audit Rules”), which replaced the prior TEFRA partnership audit regime and the concept of a “tax matters partner.”

14. PARTNERSHIP REPRESENTATIVE AND AUDIT MATTERS

14.1 Designation. The Company designates [initial partnership representative name] as the Company's “Partnership Representative” within the meaning of Code Section 6223(a). If the Partnership Representative is an entity, the Company will designate [designated individual for partnership representative] as the “designated individual” acting for the Partnership Representative as required by Treasury Regulations Section 301.6223-1(b)(3). The Partnership Representative may be removed and replaced by Major Decision Approval.

14.2 Authority of Partnership Representative. The Partnership Representative is authorized to represent the Company (at the Company's expense) in any administrative or judicial proceeding involving the Company's federal income tax matters, including audits and any resulting proceedings, and to expend Company funds for professional services and related costs.

Option A — Sole Discretion: 14.3 Sole Authority. The Partnership Representative has sole authority to act on behalf of the Company in any audit or proceeding described in Section 14.2 and sole discretion to determine whether the Company will contest or continue to contest any tax deficiency assessed or proposed by any taxing authority, in each case keeping the Members reasonably informed.

Option B — Consent Required: 14.3 Consent Required for Material Actions. The Partnership Representative will (a) promptly notify the Members in writing of the commencement of any tax audit, the receipt of any tax assessment, and the receipt of any notice of final partnership adjustment, and (b) keep the Members reasonably informed of the status of any audit and resulting proceedings. Without Major Decision Approval, the Partnership Representative may not (i) extend the statute of limitations, (ii) file a request for administrative adjustment, (iii) file suit relating to any Company tax refund or deficiency, or (iv) enter into any settlement with a taxing authority involving items of Company income, gain, loss, or deduction.

14.4 BBA Elections. With respect to any taxable year, the Partnership Representative will (a) if the Company is eligible, make an annual election under Code Section 6221(b) to opt out of the BBA Audit Rules at the Company level, or (b) if the Company is not eligible to opt out and an imputed underpayment is proposed, make an election under Code Section 6226 (the “Push-Out Election”) within 45 days after the date of the notice of final partnership adjustment, to push out the adjustment to the Members of the reviewed year, unless the Manager determines in good faith that a different election or modification under Code Section 6225 is in the best interests of the Members. The Members will cooperate with the Partnership Representative in implementing any such election, including by filing amended returns or paying any tax due as required.

14.5 Section 754 Election. On the written request of any Member following a Transfer of Membership Interests or a distribution by the Company that would result in a basis adjustment under Code Section 743 or 734, the Partnership Representative will cause the Company to make (or, if previously made, will not revoke) an election under Code Section 754. The Members acknowledge that, once made, a Section 754 election is generally irrevocable without IRS consent.

14.6 Indemnification of Partnership Representative. The Company will indemnify and hold harmless the Partnership Representative (and any designated individual) for any Losses incurred in carrying out its responsibilities in that capacity, in each case in accordance with Section 11.

15. TAX RETURNS

15.1 Preparation and Filing. The Manager will, at the Company's expense, cause the preparation and timely filing (including extensions) of all federal, state, and local tax returns and information returns required to be filed by the Company. As soon as reasonably practicable after the end of each Fiscal Year, the Manager will deliver to each Member a Schedule K-1 (or any successor form) and any other information necessary for the Member to prepare its tax returns.

15.2 Consistent Reporting. Each Member will report items of Company income, gain, loss, deduction, and credit on its tax returns in a manner consistent with the treatment of those items on the Company's returns, except as otherwise required by Applicable Law.

15.3 Fiscal Year. The Company's Fiscal Year is the calendar year, unless required or elected to be otherwise under the Code, in which case the Fiscal Year will conform to the Company's taxable year as so determined.

16. CONFIDENTIALITY

16.1 Definition. “Confidential Information” means all non-public information of, or relating to, the Company or its business, including business plans, financial information, customer and supplier lists, pricing, product and technology information, and the terms of this Agreement, in each case received or developed by a Member in connection with its membership. Confidential Information does not include information that (a) is or becomes publicly available without breach of this Agreement, (b) was rightfully known to the Member without obligation of confidence before disclosure by the Company, or (c) is independently developed by the Member without use of or reference to Confidential Information.

16.2 Obligation. Each Member will keep all Confidential Information confidential, will use Confidential Information only for purposes related to that Member's interest as a Member or as expressly authorized by the Manager, and will not disclose Confidential Information to any third party except as permitted by Section 16.3. This obligation continues during the period the Member is a Member and for [confidentiality survival period in years] years after the Member ceases to hold any Membership Interest, and continues indefinitely with respect to any Confidential Information that constitutes a trade secret of the Company.

16.3 Permitted Disclosures. A Member may disclose Confidential Information (a) to its attorneys, accountants, and other professional advisors who are bound by an obligation of confidentiality, (b) as required by Applicable Law or by valid legal process (in which case the Member will, to the extent legally permitted, give the Company prompt notice and reasonable cooperation in seeking protective relief), and (c) to any prospective Permitted Transferee that has executed a confidentiality agreement reasonably acceptable to the Manager.

17. CONFLICTS OF INTEREST AND RELATED-PARTY TRANSACTIONS

17.1 Disclosure. Each Member, the Manager, and each Officer must promptly disclose to the Company in writing any material direct or indirect interest that the discloser (or any Affiliate of the discloser, or any Family Member of an individual discloser) has in any actual or proposed transaction with the Company (each, a “Related-Party Transaction”).

17.2 Approval. The Company may enter into a Related-Party Transaction only if (a) the material facts of the relationship and the transaction are disclosed in writing to all Members, and (b) the transaction is approved by Major Decision Approval (excluding any Member with a material conflict in the transaction). The terms of any Related-Party Transaction must be commercially reasonable to the Company in light of the information known at the time of approval.

17.3 Outside Activities. Subject to Section 16 (Confidentiality) and any other written agreement between the Company and a Member, no Member is required to devote its full time or attention to the Company, and a Member may engage in or own interests in other businesses, including businesses that compete with the Company, except that a Member who is also an Officer or who is otherwise actively engaged in the management of the Company on a day-to-day basis owes the duties of an officer of a New York limited liability company under the NY LLCL and may engage in competing activities only with the prior written consent of [outside activity approval authority].

18. DISSOLUTION

18.1 Events of Dissolution. The Company will be dissolved and its affairs wound up only on the first to occur of:

(a) the affirmative election of Members holding at least the percentage required for Major Decision Approval to dissolve the Company;

(b) the sale, exchange, involuntary conversion, or other disposition or Transfer of all or substantially all the Company's assets;

(c) the entry of a decree of judicial dissolution under NY LLCL Section 702; or

(d) any other event causing dissolution under the NY LLCL that has not been waived in this Agreement to the extent waivable.

19. WINDING UP AND LIQUIDATION

19.1 Liquidator. On dissolution, the Manager (in such capacity, the “Liquidator”) will wind up the Company's affairs in accordance with the NY LLCL and this Section 19, with full power and authority to sell, assign, encumber, and otherwise dispose of Company assets and to defer the liquidation of any asset that cannot be sold immediately without undue loss to the Members.

19.2 Distribution of Assets. The Liquidator will liquidate the Company's assets and distribute the proceeds in the following order, except as otherwise required by Applicable Law:

(a) first, to the payment of the Company's debts and liabilities to creditors (including, if applicable, Members in their capacity as creditors but excluding liabilities for distributions) and the expenses of liquidation, including reasonable sales and similar commissions;

(b) second, to the payment of any Member liabilities for distributions previously authorized but unpaid;

(c) third, to the establishment of any reserves the Liquidator determines are reasonably necessary for contingent or unforeseen liabilities or obligations of the Company; and

(d) fourth, to the Members in proportion to the positive balances in their respective Capital Accounts, after taking into account all Capital Account adjustments for the taxable year of the Company in which the liquidation occurs.

19.3 Articles of Dissolution. On completion of the winding up, the Liquidator will cause Articles of Dissolution to be filed with the New York Department of State and any other filings required to terminate the Company's existence.

20. DEFINITIONS

In this Agreement, the following terms have the meanings set forth below. Other capitalized terms are defined where they first appear.

“Affiliate” means with respect to any person, any other person that, directly or indirectly, controls, is controlled by, or is under common control with that person; for this purpose, “control” means the power, direct or indirect, to direct or cause the direction of the management and policies of a person, whether through ownership of voting securities, by contract, or otherwise.

“Applicable Law” means all applicable provisions of (a) constitutions, treaties, statutes, laws (including the common law), rules, regulations, decrees, ordinances, codes, proclamations, declarations, or orders of any Governmental Authority; (b) any consents or approvals of any Governmental Authority; and (c) any orders, decisions, advisory or interpretive opinions, injunctions, judgments, awards, or decrees of, or agreements with, any Governmental Authority.

“Articles of Organization” means the articles of organization of the Company filed with the New York Department of State, as amended or restated from time to time.

“Capital Account” means the capital account maintained for each Member as described in Section 2.5.

“Capital Contribution” means any cash, property, services rendered, or promissory note or other obligation contributed by a Member to the Company in respect of its Membership Interest, as set forth on the Members Schedule.

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

“Covered Person” means each (a) Member; (b) Manager and Officer; and (c) officer, director, shareholder, partner, manager, member, Affiliate, employee, agent, or representative of a Member, the Manager, or an Officer.

“Electronic Transmission” means any form of communication, not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved, and reviewed by the recipient and that may be reproduced in paper form by an automated process.

“Equity Securities” means any Membership Interests of the Company, and any securities convertible into, exchangeable for, or exercisable for, such Membership Interests, including any options, warrants, or other rights to acquire Membership Interests.

“Fiscal Year” means the calendar year, unless required or elected to be otherwise under the Code, in which case the Fiscal Year will conform to the Company's taxable year.

“Governmental Authority” means any federal, state, local, or foreign government or political subdivision, any agency or instrumentality of a government or political subdivision, any self-regulatory organization to the extent its rules have the force of law, or any arbitrator, court, or tribunal of competent jurisdiction.

“Lien” means any mortgage, pledge, security interest, option, right of first offer, encumbrance, or other restriction or limitation of any nature.

“Membership Interest” means a Member's interest in the Company, including its rights to (a) allocations of, and distributions of, Company assets and items of Company income, gain, loss, and deduction, (b) vote on or consent to matters as provided in this Agreement and the NY LLCL, and (c) any other rights of a Member under this Agreement and the NY LLCL. The Membership Interest of each Member is expressed as a percentage of all Membership Interests on the Members Schedule.

“NY LLCL” means the New York Limited Liability Company Law and any successor statute, as amended from time to time.

“Permitted Transfer” means a Transfer described in Section 8.4.

“Person” means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association, or other entity.

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

“Transfer” means to sell, transfer, assign, gift, pledge, encumber, hypothecate, or similarly dispose of, directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, or to enter into any contract, option, or other arrangement or understanding with respect to the same; “Transferor” and “Transferee” have correlative meanings.

21. GOVERNING LAW; JURISDICTION; JURY TRIAL WAIVER

21.1 Governing Law. This Agreement and any dispute arising out of or relating to it (whether in contract, tort, statute, or otherwise) are governed by, and will be construed in accordance with, the laws of the State of New York, without giving effect to any conflict-of-laws rule that would result in the application of the laws of another jurisdiction.

21.2 Submission to Jurisdiction. Each party irrevocably submits to the exclusive jurisdiction of the federal courts located in the Southern District of New York and the state courts of the State of New York located in the City of New York, County of [new york county for disputes], in any action or proceeding arising out of or relating to this Agreement, and waives any objection based on improper venue or forum non conveniens.

21.3 Waiver of Jury Trial. EACH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY IT. EACH PARTY (a) ACKNOWLEDGES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED THAT THE OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER; AND (b) CERTIFIES THAT IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS IN THIS SECTION 21.3.

22. NOTICES AND ELECTRONIC SIGNATURES

22.1 Notices. Each notice, request, consent, claim, demand, waiver, and other communication under this Agreement (each, a “Notice”) must be in writing and is deemed given (a) on hand delivery, (b) on receipt when sent by a nationally recognized overnight courier, (c) on the date sent by email of a PDF document with confirmation of transmission if sent during normal business hours of the recipient (and on the next business day if sent after normal business hours), or (d) on the third business day after the date mailed by certified or registered mail, return receipt requested, postage prepaid. Notices to the Company are sent to the principal office set forth in Section 1.2 and to [company notice email address], attention [company notice recipient title]. Notices to a Member are sent to the address and email address for that Member set forth on the Members Schedule, or to such other address as that Member may designate by Notice given in accordance with this Section 22.1.

22.2 Electronic Signatures and Records. This Agreement, any Joinder Agreement, and any consent, waiver, or other instrument executed in connection with this Agreement may be signed and delivered electronically and will be treated as an original to the extent permitted under the federal Electronic Signatures in Global and National Commerce Act (15 U.S.C. Section 7001) and the New York Electronic Signatures and Records Act (NY State Technology Law Article III).

23. AMENDMENT

This Agreement may be amended only by a written instrument executed by the Company and signed by Members holding at least the percentage of Membership Interests required for Major Decision Approval, plus any additional Member consent required by the NY LLCL. No oral amendment or amendment by course of dealing is effective. The Manager may, without further Member consent, update the Members Schedule to reflect changes in ownership, addresses, or contact information permitted by this Agreement, and the updated Members Schedule will be incorporated into this Agreement without further amendment.

24. MISCELLANEOUS

24.1 Severability. If any provision of this Agreement is held to be invalid, illegal, or unenforceable in any jurisdiction, that holding does not affect any other provision of this Agreement or invalidate or render unenforceable the provision in any other jurisdiction. The court is empowered to modify the offending provision to the minimum extent necessary to make it valid and enforceable while preserving its commercial intent.

24.2 Counterparts. This Agreement may be executed in any number of counterparts, each of which is an original and all of which together constitute one and the same agreement. Counterparts may be exchanged by Electronic Transmission.

24.3 Entire Agreement. This Agreement, together with the Articles of Organization, Schedule I, and the Exhibits hereto, constitutes the entire agreement among the parties with respect to the subject matter and supersedes all prior and contemporaneous understandings and agreements, written or oral, on that subject.

24.4 Successors and Assigns. Subject to the restrictions on Transfers in this Agreement, this Agreement binds and benefits the parties and their respective heirs, executors, administrators, successors, and permitted assigns.

24.5 No Third-Party Beneficiaries. This Agreement is for the sole benefit of the parties and their respective heirs, executors, administrators, legal representatives, successors, and permitted assigns. Except for the rights of Covered Persons under Section 11, nothing in this Agreement, express or implied, confers on any other person any legal or equitable right, benefit, or remedy.

24.6 No Waiver. No waiver of any provision of this Agreement is effective unless in writing and signed by the waiving party. No failure or delay by any party in exercising any right under this Agreement operates as a waiver, and no single or partial exercise of any right precludes any other or further exercise of that right or any other right.

24.7 Equitable Remedies. The parties acknowledge that monetary damages alone may not adequately compensate for a breach of this Agreement, and that the non-breaching parties are entitled to seek injunctive relief and specific performance, in addition to any other remedy available at law or in equity, without being required to post a bond or other security.

24.8 Headings. Section headings are for convenience only and do not affect the interpretation of any provision of this Agreement.

24.9 Construction. This Agreement is the product of negotiation among the parties, each of whom had the opportunity to consult independent counsel, and no rule of construction will be applied against any party as the drafter.

SIGNATURE PAGE

IN WITNESS WHEREOF, the parties have executed this Operating Agreement as of the Effective Date.

THE COMPANY:

[company legal name], a New York limited liability company

By: [initial manager name], its Manager

Signature: [signature of the company]

Printed Name: [signatory name of the company]

Title: [signatory title of the company]

Date: [signature date of the company]

MEMBER 1:

[member 1 legal name]

Signature: [signature of the member 1]

Printed Name: [signatory name of the member 1]

Title: [signatory title of the member 1]

Date: [signature date of the member 1]

MEMBER 2:

[member 2 legal name]

Signature: [signature of the member 2]

Printed Name: [signatory name of the member 2]

Title: [signatory title of the member 2]

Date: [signature date of the member 2]

MEMBER 3 (if applicable):

[member 3 legal name]

Signature: [signature of the member 3]

Printed Name: [signatory name of the member 3]

Title: [signatory title of the member 3]

Date: [signature date of the member 3]

SCHEDULE I

MEMBERS SCHEDULE

Member 1

Legal Name: [member 1 legal name]

Address: [member 1 address]

Email: [member 1 email address]

Initial Capital Contribution: [member 1 initial capital contribution]

Membership Interest (%): [member 1 membership interest percentage]

Role (if any): [member 1 role]

Member 2

Legal Name: [member 2 legal name]

Address: [member 2 address]

Email: [member 2 email address]

Initial Capital Contribution: [member 2 initial capital contribution]

Membership Interest (%): [member 2 membership interest percentage]

Role (if any): [member 2 role]

Member 3 (if applicable)

Legal Name: [member 3 legal name]

Address: [member 3 address]

Email: [member 3 email address]

Initial Capital Contribution: [member 3 initial capital contribution]

Membership Interest (%): [member 3 membership interest percentage]

Role (if any): [member 3 role]

EXHIBIT A

KEY COMMERCIAL TERMS

1. Company

Company Legal Name: [company legal name]

Trade Names: [trade names]

Effective Date: [effective date]

Articles of Organization Filing Date: [articles of organization filing date]

Principal Office Address: [principal office address]

Registered Agent Name and Address: [registered agent name and address]

2. Management

Initial Manager Name: [initial manager name]

Manager Compensation Description: [manager compensation description]

Manager Removal Threshold Percentage: [manager removal threshold percentage]

Manager Election Threshold Percentage: [manager election threshold percentage]

3. Voting Thresholds

Major Decision Approval Threshold: [major decision approval threshold]

Special Meeting Call Threshold Percentage: [special meeting call threshold percentage]

Minimum Meeting Notice Days: [minimum meeting notice days]

Maximum Meeting Notice Days: [maximum meeting notice days]

Single Transaction Debt Limit: [single transaction debt limit]

Aggregate Outstanding Debt Limit: [aggregate outstanding debt limit]

Investment Approval Threshold: [investment approval threshold]

Litigation Settlement Threshold: [litigation settlement threshold]

4. Tax Matters

Initial Partnership Representative Name: [initial partnership representative name]

Designated Individual for Partnership Representative: [designated individual for partnership representative]

Tax Distribution Cadence in Days: [tax distribution cadence in days]

Assumed Combined Tax Rate Percentage: [assumed combined tax rate percentage]

5. Transfers and Exit

Transfer Approval Threshold Percentage: [transfer approval threshold percentage]

Company ROFR Exercise Period in Days: [company rofr exercise period in days]

Member ROFR Exercise Period in Days: [member rofr exercise period in days]

ROFR Sale Window in Days: [rofr sale window in days]

Involuntary Transfer Buyout Price Method: [involuntary transfer buyout price method]

Involuntary Transfer Exercise Period in Days: [involuntary transfer exercise period in days]

Successor Continuation Window in Days: [successor continuation window in days]

Cure Period in Days: [cure period in days]

Expulsion Buyout Valuation Method: [expulsion buyout valuation method]

6. Confidentiality and Conflicts

Confidentiality Survival Period in Years: [confidentiality survival period in years]

Outside Activity Approval Authority: [outside activity approval authority]

7. Notices

Company Notice Email Address: [company notice email address]

Company Notice Recipient Title: [company notice recipient title]

New York County for Disputes: [new york county for disputes]

EXHIBIT B

FORM OF JOINDER AGREEMENT

This Joinder Agreement (this “Joinder”) is entered into as of [joinder effective date] by [new member legal name] (the “New Member”) and [company legal name] (the “Company”), with reference to the Operating Agreement of the Company dated [effective date] (as amended from time to time, the “Operating Agreement”).

1. Joinder. The New Member acknowledges that it has received and read the Operating Agreement, and agrees to be bound by, and to comply with, all the terms of the Operating Agreement as if the New Member were an original party to it. From the date of this Joinder, the New Member is a Member of the Company for all purposes of the Operating Agreement.

2. Membership Interest. The New Member's initial Capital Contribution is [new member initial capital contribution], and the New Member is admitted with a Membership Interest of [new member membership interest percentage]%. The Manager will update Schedule I of the Operating Agreement to reflect this Joinder.

3. Representations. The New Member represents and warrants that (a) it has full power and authority to enter into and perform this Joinder, (b) it is acquiring its Membership Interest for its own account and not with a view to any distribution within the meaning of the Securities Act, and (c) any execution and delivery of this Joinder does not conflict with any other agreement or obligation binding on the New Member.

4. Notices. Notices to the New Member under the Operating Agreement should be sent to: [new member address]; email: [new member email address].

5. Governing Law; Counterparts. This Joinder is governed by the laws of the State of New York and may be executed in counterparts (including by Electronic Transmission), each of which is an original and all of which together constitute one instrument.

IN WITNESS WHEREOF, the parties have executed this Joinder as of the date first written above.

NEW MEMBER:

[new member legal name]

Signature: [signature of the new member]

Printed Name: [signatory name of the new member]

Title: [signatory title of the new member]

Date: [signature date of the new member]

ACCEPTED BY THE COMPANY:

[company legal name], a New York limited liability company

By: [initial manager name], its Manager

Signature: [signature of the joinder acceptance]

Printed Name: [signatory name of the joinder acceptance]

Title: [signatory title of the joinder acceptance]

Date: [signature date of the joinder acceptance]