LIMITED LIABILITY COMPANY OPERATING AGREEMENT

[COMPANY NAME], LLC

A Utah Limited Liability Company

OPERATING AGREEMENT

of

[COMPANY NAME], LLC

a Utah Limited Liability Company

Dated as of [__/__/____]

RECITALS

This Limited Liability Company Operating Agreement (this "Agreement") of [COMPANY NAME], LLC, a Utah limited liability company (the "Company"), is entered into as of [__/__/____] (the "Effective Date"), by and among the Company and the Members identified on Exhibit A attached hereto.

WHEREAS, the Company was formed as a Utah limited liability company by the filing of a Certificate of Organization with the Utah Division of Corporations and Commercial Code on [__/__/____];

WHEREAS, the Members desire to enter into this Agreement to set forth their respective rights, powers, duties, and obligations with respect to the Company and to provide for the management, operation, and governance of the Company;

WHEREAS, this Agreement is governed by the Utah Revised Uniform Limited Liability Company Act, Utah Code Ann. § 48-3a-101 et seq. (the "Act"), which became effective January 1, 2014;

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

ARTICLE I - DEFINITIONS

Section 1.1 Definitions

As used in this Agreement, the following terms have the meanings set forth below:

"Act" means the Utah Revised Uniform Limited Liability Company Act, Utah Code Ann. § 48-3a-101 et seq., as amended from time to time.

"Adjusted Capital Account" means, with respect to any Member, the balance in such Member's Capital Account as of the end of the relevant Fiscal Year, after giving effect to the following adjustments: (a) increased by any amounts which such Member is obligated to restore or is deemed obligated to restore pursuant to Treasury Regulations Sections 1.704-1(b)(2)(ii)(c), 1.704-2(g)(1), and 1.704-2(i)(5); and (b) decreased by the items described in Treasury Regulations Sections 1.704-1(b)(2)(ii)(d)(4), (5), and (6).

"Affiliate" means, with respect to any Person, any other Person that directly or indirectly Controls, is Controlled by, or is under common Control with such Person.

"Agreement" means this Limited Liability Company Operating Agreement, as amended, restated, supplemented, or otherwise modified from time to time.

"Articles of Organization" means the Certificate of Organization filed with the Utah Division of Corporations and Commercial Code to form the Company, as amended from time to time.

"Assignee" means a Person to whom a Membership Interest has been Transferred but who has not been admitted as a Member.

"Bankrupt" or "Bankruptcy" means, with respect to any Person: (a) the filing of a voluntary petition in bankruptcy or the entry of an order for relief under the federal Bankruptcy Code; (b) the filing of a petition or answer seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any present or future applicable federal, state, or other law; (c) the appointment of a receiver, custodian, or liquidator of such Person or of all or any substantial part of such Person's assets; (d) the making of a general assignment for the benefit of creditors; or (e) the admission in writing of inability to pay debts as they mature.

"Capital Account" means, with respect to each Member, the capital account established and maintained for such Member in accordance with Section 4.4 of this Agreement.

"Capital Contribution" means, with respect to any Member, the total amount of cash and the fair market value of any property contributed to the Company by such Member.

"Certificate of Organization" means the Certificate of Organization filed with the Utah Division of Corporations and Commercial Code pursuant to Utah Code Ann. § 48-3a-201.

"Code" means the Internal Revenue Code of 1986, as amended from time to time, and any successor statute.

"Company" means [COMPANY NAME], LLC, a Utah limited liability company.

"Company Minimum Gain" has the meaning set forth in Treasury Regulations Section 1.704-2(b)(2).

"Control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through ownership of voting securities, by contract, or otherwise.

"Distributable Cash" means all cash received by the Company from Company operations and from all other sources, less: (a) all cash disbursements for Company expenses; (b) all principal and interest payments on Company indebtedness; (c) Capital Expenditures; and (d) reserves for working capital, future Capital Expenditures, and contingencies as determined by the [Members/Manager(s)].

"Distribution" means any distribution of cash or property by the Company to a Member with respect to such Member's Membership Interest.

"Economic Interest" means a Person's right to share in the Profits, Losses, and Distributions of the Company, without any right to participate in the management or affairs of the Company.

"Fiscal Year" means the Company's fiscal year, which shall be the calendar year unless otherwise determined by the [Members/Manager(s)].

"Majority Interest" means Members holding more than fifty percent (50%) of the Percentage Interests of all Members entitled to vote.

"Manager" means each Person designated as a manager of the Company pursuant to Article VI, in their capacity as such.

"Member" means each Person who has been admitted to the Company as a member and who has not ceased to be a member.

"Member Minimum Gain" has the meaning set forth in Treasury Regulations Section 1.704-2(i)(2).

"Membership Interest" means a Member's entire interest in the Company, including such Member's Economic Interest, voting rights, and right to participate in management of the Company.

"Percentage Interest" means, with respect to each Member, the percentage set forth opposite such Member's name on Exhibit A, as amended from time to time.

"Person" means any individual, corporation, partnership, limited liability company, trust, estate, association, or other entity.

"Profits" and "Losses" mean, for each Fiscal Year or other applicable period, the Company's taxable income or loss determined in accordance with Code Section 703(a).

"Qualified Income Offset" has the meaning set forth in Treasury Regulations Section 1.704-1(b)(2)(ii)(d).

"Series" means a series of the Company established pursuant to Utah Code Ann. § 48-3a-1201 et seq., if applicable.

"Supermajority Interest" means Members holding at least [seventy-five percent (75%)/two-thirds (66.67%)] of the Percentage Interests of all Members entitled to vote.

"Tax Matters Partner" or "Partnership Representative" means the Member designated pursuant to Section 10.2 to act as the tax matters partner under Code Section 6231 or partnership representative under Code Section 6223.

"Transfer" means any sale, assignment, transfer, exchange, mortgage, pledge, grant of a security interest, or other disposition, whether voluntary, involuntary, or by operation of law.

"Treasury Regulations" means the regulations promulgated under the Code by the United States Department of the Treasury.

"Utah Division" means the Utah Division of Corporations and Commercial Code.

Section 1.2 Interpretation

(a) The singular includes the plural and vice versa.

(b) References to Articles, Sections, and Exhibits are to this Agreement unless otherwise stated.

(c) Headings are for convenience only and do not affect interpretation.

(d) The words "include" and "including" are not limiting.

(e) References to statutes include regulations thereunder and amendments thereto.

ARTICLE II - FORMATION AND ORGANIZATION

Section 2.1 Formation

The Company was formed as a Utah limited liability company pursuant to the Act by the filing of a Certificate of Organization with the Utah Division on [__/__/____].

Section 2.2 Name

The name of the Company is [COMPANY NAME], LLC. The Company may conduct business under that name or any other name approved by the [Members/Manager(s)], provided that any fictitious business name is registered as required by Utah law.

Section 2.3 Principal Place of Business

The principal place of business of the Company shall be located at:

[________________________________]
[________________________________]
[________________________________], Utah [____]

The [Members/Manager(s)] may change the principal place of business upon notice to all Members.

Section 2.4 Registered Agent and Office

(a) The Company's registered agent in the State of Utah is:

Name: [________________________________]
Address: [________________________________]
[________________________________], Utah [____]

(b) The registered agent and registered office may be changed by filing the appropriate documents with the Utah Division pursuant to Utah Code Ann. § 48-3a-115.

Section 2.5 Term

The Company shall have perpetual existence, unless dissolved in accordance with Article XII of this Agreement or as otherwise provided by the Act.

Section 2.6 Purpose

The Company is formed for the purpose of:

[________________________________]
[________________________________]

and to engage in any and all lawful activities for which a limited liability company may be organized under the Act.

Section 2.7 Series LLC Designation

☐ SERIES LLC: This LLC IS designated as a Series LLC under Utah Code Ann. § 48-3a-1201 et seq.

☐ TRADITIONAL LLC: This LLC is NOT a Series LLC.

[IF SERIES LLC IS SELECTED, COMPLETE THE FOLLOWING:]

Section 2.8 Series LLC Provisions

(a) Authority to Establish Series. The Company is authorized to establish one or more Series pursuant to Utah Code Ann. § 48-3a-1201 et seq.

(b) Separate Series. Each Series shall be treated as a separate entity for purposes of:
- (i) Holding assets;
- (ii) Incurring liabilities;
- (iii) Conducting business;
- (iv) Having separate members; and
- (v) Separate management.

(c) Liability Shield. In accordance with Utah Code Ann. § 48-3a-1202, the debts, liabilities, obligations, and expenses incurred by a particular Series shall be enforceable only against the assets of that Series and not against the assets of the Company generally or any other Series.

(d) Separate Records. The Company shall maintain separate and distinct records for each Series and shall account for the assets belonging to each Series separately from the other assets of the Company and any other Series.

(e) Series Operating Agreement. Each Series may have its own operating agreement governing the affairs of that Series, which shall be consistent with this Agreement.

(f) Series Designation. The establishment of each Series shall be evidenced by a certificate of designation filed with the Utah Division.

ARTICLE III - MEMBERS

Section 3.1 Initial Members

The initial Members of the Company, their addresses, Capital Contributions, and Percentage Interests are set forth on Exhibit A attached hereto.

Section 3.2 Admission of Additional Members

(a) New Members may be admitted to the Company only upon the affirmative vote or written consent of [a Majority Interest/a Supermajority Interest/all Members].

(b) As a condition to admission, each new Member shall:
- (i) Execute and deliver to the Company a counterpart of this Agreement or a joinder agreement;
- (ii) Make any required Capital Contribution;
- (iii) Deliver to the Company any information required for tax and regulatory compliance; and
- (iv) Pay any costs associated with such admission.

(c) Upon admission, Exhibit A shall be amended to reflect the new Member's information.

Section 3.3 Representations and Warranties of Members

Each Member represents and warrants to the Company and each other Member that:

(a) If an entity, such Member is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization;

(b) Such Member has full power and authority to execute and deliver this Agreement and to perform its obligations hereunder;

(c) This Agreement constitutes the legal, valid, and binding obligation of such Member;

(d) Such Member is acquiring its Membership Interest for investment purposes only and not with a view to distribution;

(e) Such Member is an "accredited investor" as defined in Rule 501 of Regulation D under the Securities Act of 1933, if applicable;

(f) Such Member has received and reviewed all information concerning the Company that such Member considers necessary or appropriate for deciding whether to acquire the Membership Interest;

(g) Such Member has had the opportunity to ask questions and receive answers concerning the Company and the terms of the Membership Interest.

Section 3.4 Member Meetings

(a) Annual Meeting. An annual meeting of Members shall be held at such time and place as designated by the [Members/Manager(s)] for the purpose of transacting any business that may properly come before the meeting.

(b) Special Meetings. Special meetings of Members may be called by:
- (i) The Manager(s), if Manager-managed;
- (ii) Members holding at least [twenty percent (20%)] of the Percentage Interests; or
- (iii) As otherwise required by the Act.

(c) Notice. Written notice of any meeting shall be given to all Members not less than [ten (10)] nor more than [sixty (60)] days before the meeting, stating the place, date, time, and purpose of the meeting.

(d) Quorum. The presence in person or by proxy of Members holding a Majority Interest shall constitute a quorum.

(e) Voting. Except as otherwise provided in this Agreement, Members shall vote in proportion to their Percentage Interests.

(f) Proxies. A Member may vote by written proxy signed by the Member.

(g) Action Without Meeting. Any action that may be taken at a meeting of Members may be taken without a meeting if consented to in writing by Members holding the requisite Percentage Interests required for such action.

(h) Telephonic Meetings. Members may participate in meetings by telephone or other electronic means that allows all participants to hear each other, and such participation shall constitute presence at the meeting.

Section 3.5 Limitation of Liability

(a) Pursuant to Utah Code Ann. § 48-3a-304, no Member shall be personally liable for any debt, obligation, or liability of the Company solely by reason of being a Member.

(b) The failure of the Company to observe any formalities or requirements relating to the exercise of its powers or management of its business shall not be grounds for imposing personal liability on the Members.

Section 3.6 No Withdrawal

Except as expressly permitted in this Agreement, no Member may withdraw or resign from the Company prior to its dissolution and winding up.

ARTICLE IV - CAPITAL CONTRIBUTIONS

Section 4.1 Initial Capital Contributions

Each Member shall make the initial Capital Contribution set forth opposite such Member's name on Exhibit A, on or before the date set forth therein.

Section 4.2 Additional Capital Contributions

(a) No Member shall be required to make any additional Capital Contribution to the Company without the consent of such Member.

(b) The [Members/Manager(s)] may call for additional Capital Contributions by giving written notice to all Members specifying the amount and purpose of such contribution and the date by which it must be made.

(c) Each Member who elects to participate in an additional Capital Contribution shall contribute its pro rata share based on Percentage Interests unless the Members otherwise agree.

(d) If any Member fails to make an additional Capital Contribution when called and due, the Company may pursue any or all of the following remedies:
- (i) Treat such failure as a default and adjust such Member's Percentage Interest;
- (ii) Permit other Members to contribute the shortfall and adjust Percentage Interests accordingly;
- (iii) Treat the unpaid amount as a loan from the Company to the defaulting Member;
- (iv) Pursue any other remedies available at law or in equity.

Section 4.3 Form of Capital Contributions

Capital Contributions may be made in cash or, with the approval of [a Majority Interest/the Manager(s)], in property. The fair market value of any non-cash contribution shall be determined by [the Members/an independent appraiser].

Section 4.4 Capital Accounts

(a) Establishment. A separate Capital Account shall be established and maintained for each Member in accordance with the rules of Treasury Regulations Section 1.704-1(b)(2)(iv).

(b) Credits. Each Member's Capital Account shall be increased by:
- (i) The amount of cash contributed by such Member;
- (ii) The fair market value of property contributed by such Member (net of liabilities);
- (iii) Allocations of Profits to such Member; and
- (iv) Any other items required by the Treasury Regulations.

(c) Debits. Each Member's Capital Account shall be decreased by:
- (i) The amount of cash distributed to such Member;
- (ii) The fair market value of property distributed to such Member (net of liabilities);
- (iii) Allocations of Losses to such Member; and
- (iv) Any other items required by the Treasury Regulations.

(d) Compliance. The provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Treasury Regulations Section 1.704-1(b) and shall be interpreted and applied in a manner consistent with such regulations.

Section 4.5 No Interest on Capital

No Member shall be entitled to interest on such Member's Capital Contribution or Capital Account.

Section 4.6 Return of Capital

(a) Except as otherwise provided in this Agreement, no Member shall have the right to demand or receive a return of such Member's Capital Contribution.

(b) A Member's Capital Contribution may be returned only to the extent permitted by this Agreement and applicable law.

(c) No Member shall be personally liable for the return of any other Member's Capital Contribution.

Section 4.7 Member Loans

(a) Any Member may, with the consent of [a Majority Interest/the Manager(s)], make loans to the Company.

(b) Such loans shall bear interest at a rate determined by the [Members/Manager(s)] and shall be repaid according to terms approved by the [Members/Manager(s)].

(c) Member loans shall not be treated as Capital Contributions and shall not affect the lending Member's Percentage Interest.

ARTICLE V - ALLOCATIONS AND DISTRIBUTIONS

Section 5.1 Allocation of Profits and Losses

(a) General Rule. Except as otherwise provided in this Section, Profits and Losses for each Fiscal Year shall be allocated among the Members in proportion to their respective Percentage Interests.

(b) Regulatory Allocations. The following special allocations shall be made in the following order:

(i) Minimum Gain Chargeback. Notwithstanding any other provision of this Article V, if there is a net decrease in Company Minimum Gain during any Fiscal Year, each Member shall be allocated items of income and gain for such year equal to such Member's share of the net decrease in Company Minimum Gain, as determined under Treasury Regulations Section 1.704-2(g)(2).

(ii) Member Minimum Gain Chargeback. Notwithstanding any other provision of this Article V (except Section 5.1(b)(i)), if there is a net decrease in Member Minimum Gain attributable to a Member Nonrecourse Debt during any Fiscal Year, each Member who has a share of the Member Minimum Gain shall be allocated items of income and gain for such year equal to such Member's share of the net decrease, as determined under Treasury Regulations Section 1.704-2(i)(4).

(iii) Qualified Income Offset. If any Member unexpectedly receives an adjustment, allocation, or distribution described in Treasury Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5), or (6), items of income and gain shall be allocated to such Member in an amount and manner sufficient to eliminate the Adjusted Capital Account deficit created by such adjustment, allocation, or distribution as quickly as possible.

(iv) Gross Income Allocation. If any Member has a deficit Capital Account at the end of any Fiscal Year that is in excess of the amount such Member is obligated to restore, each such Member shall be allocated items of income and gain in the amount of such excess as quickly as possible.

(v) Nonrecourse Deductions. Nonrecourse Deductions shall be allocated among the Members in proportion to their Percentage Interests.

(vi) Member Nonrecourse Deductions. Any Member Nonrecourse Deductions for any Fiscal Year shall be allocated to the Member who bears the economic risk of loss with respect to the Member Nonrecourse Debt.

(c) Curative Allocations. The allocations in Section 5.1(b) are intended to comply with certain requirements of Treasury Regulations Sections 1.704-1(b) and 1.704-2. The Members intend that these allocations shall be offset by special allocations, if necessary, so that the net amount allocated to each Member equals the amount that would have been allocated if the special allocations had not occurred.

(d) Tax Allocations. For income tax purposes, each item of income, gain, loss, and deduction shall be allocated among the Members in the same manner as the corresponding items of Profits and Losses are allocated, except as otherwise required by Code Section 704(c) or Treasury Regulations Section 1.704-1(b)(4).

Section 5.2 Distributions

(a) Timing. Distributions of Distributable Cash may be made at such times and in such amounts as determined by the [Members/Manager(s)].

(b) Pro Rata. Except as otherwise provided in this Agreement, all Distributions shall be made to the Members in proportion to their respective Percentage Interests.

(c) Form. Distributions may be made in cash or in-kind, as determined by the [Members/Manager(s)].

(d) Restrictions. No Distribution shall be made if, after giving effect thereto:
- (i) The Company would not be able to pay its debts as they become due in the ordinary course of business; or
- (ii) The Company's total assets would be less than the sum of its total liabilities.

Section 5.3 Tax Distributions

(a) The Company shall make tax distributions to each Member in an amount at least equal to such Member's Tax Distribution Amount for each Fiscal Year.

(b) "Tax Distribution Amount" means, for each Member for each Fiscal Year, the product of: (i) such Member's allocable share of the Company's taxable income for such Fiscal Year, multiplied by (ii) the highest combined federal and state marginal income tax rate applicable to individuals or corporations for such Fiscal Year.

(c) Tax Distributions shall be made quarterly, within [fifteen (15)] days after the end of each calendar quarter, based on estimated taxable income.

(d) Tax Distributions shall be treated as advances on Distributions otherwise payable to such Member.

Section 5.4 Limitations on Distributions

(a) The Company shall not make any Distribution to Members to the extent such Distribution would violate the Act or other applicable law.

(b) A Member who receives a Distribution in violation of this Section 5.4 or the Act shall be liable to the Company for the amount of the Distribution, subject to applicable statutes of limitation.

Section 5.5 Withholding

The Company may withhold from any Distribution to a Member any amount required to be withheld under applicable tax laws. Any amount so withheld shall be treated as having been distributed to such Member.

ARTICLE VI - MANAGEMENT

Section 6.1 Management Structure

☐ MEMBER-MANAGED: The Company shall be managed by its Members.

☐ MANAGER-MANAGED: The Company shall be managed by the Manager(s) designated herein.

Section 6.2 Member-Managed Company

[IF MEMBER-MANAGED IS SELECTED:]

(a) Authority. Each Member shall have equal rights in the management and conduct of the Company's business, subject to the voting requirements of this Agreement.

(b) Ordinary Decisions. Ordinary business matters shall be decided by a Majority Interest.

(c) Major Decisions. The following matters shall require the approval of [a Supermajority Interest/all Members]:
- (i) Amending or restating this Agreement;
- (ii) Admitting new Members;
- (iii) Approving any Transfer of a Membership Interest;
- (iv) Merging or consolidating the Company with another entity;
- (v) Selling all or substantially all of the Company's assets;
- (vi) Dissolving or winding up the Company;
- (vii) Incurring indebtedness in excess of $[________________];
- (viii) Making Capital Expenditures in excess of $[________________];
- (ix) Entering into any agreement with a term exceeding [________________] years;
- (x) Filing for bankruptcy or similar proceedings;
- (xi) Changing the Company's principal business activity;
- (xii) Establishing or closing any Series;
- (xiii) Any other matter designated as requiring approval in this Agreement.

(d) Agency Authority. Pursuant to Utah Code Ann. § 48-3a-301, each Member is an agent of the Company for purposes of its business and has the authority to bind the Company.

Section 6.3 Manager-Managed Company

[IF MANAGER-MANAGED IS SELECTED:]

(a) Designation of Manager(s). The following Person(s) shall serve as the initial Manager(s) of the Company:

Manager 1:
Name: [________________________________]
Address: [________________________________]
[________________________________]

Manager 2: (if applicable)
Name: [________________________________]
Address: [________________________________]
[________________________________]

(b) Authority of Manager(s). The Manager(s) shall have full, exclusive, and complete authority, power, and discretion to manage and control the business, affairs, and properties of the Company, subject to the limitations set forth in this Agreement.

(c) Scope of Authority. Without limiting the generality of the foregoing, the Manager(s) shall have authority to:
- (i) Execute contracts and agreements on behalf of the Company;
- (ii) Open and maintain bank accounts;
- (iii) Hire and terminate employees and consultants;
- (iv) Acquire, hold, and dispose of property;
- (v) Borrow money and grant security interests;
- (vi) Make Distributions to Members;
- (vii) Institute and defend legal proceedings;
- (viii) Take all actions necessary for the day-to-day operations of the Company.

(d) Matters Requiring Member Approval. Notwithstanding the foregoing, the following matters shall require the approval of [a Majority Interest/a Supermajority Interest/all Members]:
- (i) Amending or restating this Agreement;
- (ii) Admitting new Members;
- (iii) Approving any Transfer of a Membership Interest;
- (iv) Merging or consolidating the Company with another entity;
- (v) Selling all or substantially all of the Company's assets;
- (vi) Dissolving or winding up the Company;
- (vii) Incurring indebtedness in excess of $[________________];
- (viii) Making Capital Expenditures in excess of $[________________];
- (ix) Establishing or closing any Series;
- (x) Removing or replacing a Manager;
- (xi) Any other matter designated as requiring approval in this Agreement.

(e) Number of Managers. The number of Managers shall be [one (1)/[____]], which number may be changed by a Majority Interest.

(f) Term. Each Manager shall serve until such Manager's death, resignation, removal, or disqualification.

(g) Resignation. A Manager may resign at any time by giving written notice to the Members. Such resignation shall be effective upon the date specified in the notice or, if no date is specified, upon receipt.

(h) Removal. A Manager may be removed at any time, with or without cause, by the affirmative vote of [a Majority Interest/a Supermajority Interest].

(i) Vacancy. Any vacancy in the position of Manager shall be filled by the affirmative vote of a Majority Interest.

(j) Compensation. The Manager(s) may receive compensation for services rendered to the Company, as determined by a Majority Interest.

(k) Meetings. If there is more than one Manager, the Managers may hold meetings as necessary to conduct Company business. Meetings may be held in person, by telephone, or by electronic means.

Section 6.4 Officers

(a) The [Members/Manager(s)] may designate one or more officers of the Company, including a President, Vice President, Secretary, Treasurer, and such other officers as may be appropriate.

(b) Officers shall have such duties and authority as determined by the [Members/Manager(s)].

(c) Officers shall serve at the pleasure of the [Members/Manager(s)] and may be removed at any time with or without cause.

(d) The following individuals shall serve as the initial officers of the Company:

Section 6.5 Standard of Care

(a) Pursuant to Utah Code Ann. § 48-3a-405, each Member (in a member-managed company) and each Manager (in a manager-managed company) owes to the Company and the other Members:

(i) Duty of Loyalty. The duty of loyalty includes:
- (A) To account for and hold as trustee any property, profit, or benefit derived in the conduct of the Company's activities;
- (B) To refrain from dealing with the Company as or on behalf of a party having an interest adverse to the Company;
- (C) To refrain from competing with the Company in the conduct of the Company's activities.

(ii) Duty of Care. The duty of care is to refrain from engaging in grossly negligent or reckless conduct, willful or intentional misconduct, or knowing violation of law.

(b) A Member or Manager does not violate a duty under this Agreement merely because such Person's conduct furthers such Person's own interest.

(c) The Members may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty.

Section 6.6 Indemnification

(a) Scope of Indemnification. The Company shall indemnify, defend, and hold harmless each Member, Manager, officer, employee, and agent of the Company (each, an "Indemnified Person") from and against any and all losses, claims, damages, liabilities, costs, and expenses (including reasonable attorneys' fees) arising from any claim, demand, action, suit, or proceeding in which such Indemnified Person may be involved by reason of being or having been a Member, Manager, officer, employee, or agent of the Company.

(b) Standard for Indemnification. Indemnification shall be provided under this Section only if:
- (i) The Indemnified Person acted in good faith;
- (ii) The Indemnified Person reasonably believed that such conduct was in the best interests of the Company or at least not opposed to the best interests of the Company; and
- (iii) In the case of criminal proceedings, the Indemnified Person had no reasonable cause to believe that such conduct was unlawful.

(c) Advancement of Expenses. The Company shall pay or reimburse reasonable expenses incurred by an Indemnified Person in advance of the final disposition of any proceeding, upon receipt of:
- (i) A written affirmation of the Indemnified Person's good faith belief that such Person has met the applicable standard of conduct; and
- (ii) A written undertaking to repay the amounts advanced if it is ultimately determined that indemnification is not permitted.

(d) Non-Exclusive Remedy. The rights to indemnification under this Section are not exclusive of any other rights to which any Person may be entitled.

(e) Insurance. The Company may purchase and maintain insurance on behalf of any Indemnified Person against any liability asserted against or incurred by such Person.

Section 6.7 Exculpation

(a) No Member, Manager, officer, employee, or agent shall be liable to the Company or any Member for any loss or damage resulting from any act or omission taken or suffered by such Person in good faith and reasonably believed by such Person to be authorized or within the scope of such Person's authority, except for:
- (i) Any breach of the duty of loyalty;
- (ii) Acts or omissions not in good faith or involving intentional misconduct or knowing violation of law;
- (iii) Any transaction from which such Person derived an improper personal benefit.

(b) The provisions of this Section are in addition to any other limitations on liability permitted under the Act.

Section 6.8 Records and Reports

(a) Records. The Company shall maintain at its principal place of business:
- (i) A current list of the full name and last known address of each Member;
- (ii) A copy of the Certificate of Organization and all amendments;
- (iii) Copies of the Company's federal, state, and local income tax returns for the three most recent years;
- (iv) Copies of this Agreement and all amendments;
- (v) Financial statements for the three most recent years;
- (vi) Minutes of all meetings of Members and Managers.

(b) Inspection Rights. Each Member has the right, upon reasonable request, to inspect and copy the records required to be maintained pursuant to Utah Code Ann. § 48-3a-410.

(c) Annual Reports. The [Manager(s)/designated Member] shall provide to each Member, within [ninety (90)] days after the end of each Fiscal Year:
- (i) An annual report of the Company's business activities;
- (ii) Financial statements for such Fiscal Year;
- (iii) A statement of each Member's Capital Account balance;
- (iv) Tax information necessary for the preparation of each Member's tax returns.

Section 6.9 Bank Accounts

(a) The Company shall maintain one or more accounts at financial institutions designated by the [Members/Manager(s)].

(b) Withdrawals from Company accounts shall be made only by authorized signatories designated by the [Members/Manager(s)].

ARTICLE VII - TRANSFERS OF MEMBERSHIP INTERESTS

Section 7.1 General Restriction on Transfer

(a) No Member shall Transfer all or any part of such Member's Membership Interest without compliance with this Article VII.

(b) Any purported Transfer in violation of this Article VII shall be void and of no effect.

Section 7.2 Permitted Transfers

A Member may Transfer all or any part of such Member's Membership Interest without the consent of the other Members to:

(a) A revocable trust of which the transferring Member is the sole beneficiary or primary beneficiary during such Member's lifetime;

(b) The spouse, domestic partner, children, grandchildren, or parents of the transferring Member;

(c) An Affiliate of the transferring Member;

(d) Another Member;

(e) Any Person approved by [a Majority Interest/all Members].

Section 7.3 Right of First Refusal

(a) Notice of Proposed Transfer. Before any Member may Transfer a Membership Interest to a third party (other than pursuant to Section 7.2), such Member (the "Selling Member") shall give written notice (the "Sale Notice") to the Company and the other Members (the "Non-Selling Members") of such Member's intention to make such Transfer, which notice shall include:
- (i) The name and address of the proposed transferee;
- (ii) The terms and conditions of the proposed Transfer;
- (iii) The purchase price;
- (iv) A copy of any written offer or agreement.

(b) Company Option. The Company shall have the first option to purchase all (but not less than all) of the Membership Interest proposed to be Transferred at the price and on the terms stated in the Sale Notice. The Company shall have [thirty (30)] days from receipt of the Sale Notice to exercise this option by written notice to the Selling Member.

(c) Member Option. If the Company does not exercise its option, each Non-Selling Member shall have the option to purchase a pro rata share (based on Percentage Interests among Non-Selling Members) of the Membership Interest proposed to be Transferred. Non-Selling Members shall have [thirty (30)] days from the expiration of the Company's option period to exercise this option.

(d) Closing. If the Company or Non-Selling Members exercise their options, the closing of the purchase shall occur within [sixty (60)] days after the exercise of the option.

(e) Sale to Third Party. If the Company and Non-Selling Members do not exercise their options, the Selling Member may Transfer the Membership Interest to the proposed transferee at the price and on the terms stated in the Sale Notice, provided that such Transfer is completed within [ninety (90)] days after the expiration of all option periods.

Section 7.4 Tag-Along Rights

(a) If any Member or group of Members (the "Tag-Along Seller(s)") proposes to Transfer Membership Interests representing more than [fifty percent (50%)] of the total Percentage Interests to a third party, each other Member (the "Tag-Along Member(s)") shall have the right to participate in such Transfer on the same terms and conditions.

(b) The Tag-Along Seller(s) shall give written notice to the Tag-Along Members at least [thirty (30)] days prior to the proposed Transfer.

(c) Each Tag-Along Member may elect to participate by giving written notice within [fifteen (15)] days of receiving the Tag-Along notice.

Section 7.5 Drag-Along Rights

(a) If Members holding at least [seventy-five percent (75%)] of the total Percentage Interests (the "Drag-Along Sellers") propose to Transfer all of their Membership Interests to a third party, the Drag-Along Sellers may require all other Members (the "Drag-Along Members") to Transfer their Membership Interests on the same terms and conditions.

(b) The Drag-Along Sellers shall give written notice to the Drag-Along Members at least [thirty (30)] days prior to the proposed Transfer.

(c) The Drag-Along Members shall be obligated to participate in the Transfer and execute all documents reasonably necessary to effect the Transfer.

Section 7.6 Admission of Transferees

(a) No Assignee shall become a Member unless:
- (i) The Transfer is made in compliance with this Article VII;
- (ii) The Assignee agrees in writing to be bound by this Agreement;
- (iii) [A Majority Interest/all Members] consent to the admission; and
- (iv) The Assignee pays all costs associated with the Transfer and admission.

(b) Until admitted as a Member, an Assignee shall have only the rights of an Assignee as set forth in Utah Code Ann. § 48-3a-502, including the right to receive Distributions.

Section 7.7 Involuntary Transfers

(a) In the event of any involuntary Transfer of a Membership Interest by operation of law, including due to death, divorce, Bankruptcy, or attachment, the Company and the other Members shall have the option to purchase such Membership Interest at fair market value.

(b) Upon the death of a Member who is a natural person, such Member's Membership Interest shall pass to such Member's estate or designated beneficiary, but such transferee shall have only the rights of an Assignee unless admitted as a Member pursuant to Section 7.6.

Section 7.8 No Dissolution on Transfer

No Transfer of a Membership Interest shall dissolve the Company. The Company shall continue its business without dissolution following any Transfer.

ARTICLE VIII - BUYOUT PROVISIONS

Section 8.1 Events Triggering Buyout

The following events shall trigger the buyout provisions of this Article VIII:

(a) Death of a Member;
(b) Permanent disability of a Member;
(c) Bankruptcy of a Member;
(d) Withdrawal of a Member (if permitted);
(e) Expulsion of a Member;
(f) Any other event specified in this Agreement.

Section 8.2 Purchase Price

(a) The purchase price for a Membership Interest subject to this Article VIII shall be the fair market value of such Membership Interest.

(b) Fair market value shall be determined by:

☐ Agreed Value: The value most recently agreed upon by all Members and set forth in Exhibit C attached hereto.

☐ Formula: [________________________________]

☐ Appraisal: An independent appraiser selected by the Company and the selling Member (or such Member's representative). If they cannot agree on an appraiser within [thirty (30)] days, each party shall select an appraiser and the two appraisers shall select a third appraiser. The average of the three appraisals shall be the fair market value.

(c) The fair market value shall be determined as of the date of the triggering event.

Section 8.3 Payment Terms

(a) Lump Sum: The purchase price may be paid in a single lump sum within [ninety (90)] days of determination.

(b) Installments: Alternatively, the purchase price may be paid in [____] equal installments over [____] years, with interest at the rate of [____]% per annum on the unpaid balance.

(c) Security: Any installment payments shall be secured by a promissory note and, at the seller's request, a security interest in the Membership Interest being purchased.

ARTICLE IX - ACCOUNTING AND TAX MATTERS

Section 9.1 Fiscal Year

The Fiscal Year of the Company shall be the calendar year, unless otherwise determined by the [Members/Manager(s)].

Section 9.2 Accounting Method

The Company shall use the [cash/accrual] method of accounting for both book and tax purposes, unless otherwise required by the Code or Treasury Regulations.

Section 9.3 Books and Records

(a) The Company shall maintain complete and accurate books and records of account in accordance with generally accepted accounting principles consistently applied.

(b) The books and records shall be maintained at the Company's principal place of business.

Section 9.4 Financial Statements

The [Manager(s)/designated Member] shall cause to be prepared and delivered to each Member:

(a) Within [thirty (30)] days after the end of each month, unaudited monthly financial statements;

(b) Within [ninety (90)] days after the end of each Fiscal Year, annual financial statements, which shall include a balance sheet, income statement, and statement of cash flows;

(c) Such other financial information as any Member may reasonably request.

Section 9.5 Tax Returns

(a) The Company shall prepare and file all required federal, state, and local tax returns.

(b) Within [ninety (90)] days after the end of each Fiscal Year, the Company shall deliver to each Member a Schedule K-1 or other applicable tax information.

Section 9.6 Tax Elections

The [Members/Manager(s)] shall make or cause to be made any tax elections deemed advisable for the Company, including:

(a) An election under Code Section 754 to adjust the basis of Company property;

(b) An election to be classified as a partnership or disregarded entity for federal income tax purposes;

(c) Any other elections permitted under the Code or state tax laws.

ARTICLE X - TAX MATTERS PARTNER/PARTNERSHIP REPRESENTATIVE

Section 10.1 Tax Classification

The Company intends to be classified as:

☐ A partnership for federal income tax purposes (if two or more Members).

☐ A disregarded entity for federal income tax purposes (if a single Member).

☐ An S corporation for federal income tax purposes.

☐ A C corporation for federal income tax purposes.

Section 10.2 Partnership Representative

(a) Designation. [________________________________] is hereby designated as the Partnership Representative pursuant to Code Section 6223 and shall have the authority and responsibilities set forth in the Code and Treasury Regulations.

(b) Authority. The Partnership Representative shall have the sole authority to act on behalf of the Company in any administrative or judicial proceeding with the Internal Revenue Service.

(c) Push-Out Election. The Partnership Representative shall, if requested by a Majority Interest, elect the alternative procedure under Code Section 6226 (the "push-out election") to push out any imputed underpayment to the Members.

(d) Cooperation. Each Member shall cooperate with the Partnership Representative and provide any information reasonably requested.

(e) Indemnification. Each Member agrees to indemnify the Company for such Member's share of any tax liability, penalties, and interest resulting from audit adjustments.

Section 10.3 Utah State Taxes

(a) No State Income Tax. Utah does not impose a corporate income tax on LLCs taxed as partnerships or disregarded entities. However, Members who are Utah residents must report their distributive share of Company income on their individual Utah tax returns.

(b) Withholding. If required by Utah law, the Company shall withhold and remit Utah income tax on distributions to nonresident Members.

(c) Annual Renewal. The Company shall file the required annual renewal with the Utah Division and pay any required fees pursuant to Utah Code Ann. § 48-3a-212.

ARTICLE XI - CONFIDENTIALITY AND NON-COMPETE

Section 11.1 Confidential Information

(a) Each Member acknowledges that such Member may receive confidential and proprietary information of the Company ("Confidential Information").

(b) Each Member agrees to maintain the confidentiality of all Confidential Information and not to disclose such information to any third party without the prior written consent of the Company, except:
- (i) As required by law or court order;
- (ii) To such Member's attorneys, accountants, and other professional advisors;
- (iii) Information that becomes publicly available through no fault of the disclosing Member.

(c) This confidentiality obligation shall survive the termination of a Member's Membership Interest for a period of [three (3)] years.

Section 11.2 Non-Competition

☐ NON-COMPETE APPLICABLE

Each Member agrees that, during the term of such Member's membership and for a period of [____] year(s) after the termination thereof, such Member shall not:

(a) Engage in any business that competes with the Company within [geographic area];

(b) Solicit any customer, client, or supplier of the Company;

(c) Solicit or hire any employee or consultant of the Company.

☐ NO NON-COMPETE: No non-competition restrictions apply to the Members.

ARTICLE XII - DISSOLUTION AND WINDING UP

Section 12.1 Events Causing Dissolution

The Company shall be dissolved upon the earliest to occur of the following:

(a) The affirmative vote or written consent of [a Majority Interest/a Supermajority Interest/all Members];

(b) The entry of a judicial decree of dissolution pursuant to Utah Code Ann. § 48-3a-701;

(c) Administrative dissolution by the Utah Division pursuant to Utah Code Ann. § 48-3a-708;

(d) The occurrence of any other event specified in this Agreement or the Certificate of Organization as causing dissolution;

(e) The occurrence of any event that makes it unlawful for the Company's business to be continued.

Section 12.2 Effect of Dissolution

Upon dissolution, the Company shall cease to carry on its business except as necessary to wind up its affairs.

Section 12.3 Winding Up

(a) Upon dissolution, the [Members/Manager(s)/designated liquidating trustee] shall wind up the Company's affairs.

(b) The winding up shall include:
- (i) Collecting all Company assets;
- (ii) Paying or providing for all Company debts, liabilities, and obligations;
- (iii) Distributing any remaining assets to the Members.

Section 12.4 Order of Distribution

Upon winding up, the assets of the Company shall be distributed in the following order:

(a) First, to creditors, including Members who are creditors, in satisfaction of the Company's debts and liabilities;

(b) Second, to establish any reserves deemed reasonably necessary for contingent or unforeseen liabilities;

(c) Third, to Members in proportion to the positive balances in their Capital Accounts after all allocations for the final Fiscal Year have been made;

(d) Fourth, to Members in proportion to their Percentage Interests.

Section 12.5 Certificate of Dissolution

Upon completion of the winding up, the Company shall file a Certificate of Dissolution with the Utah Division pursuant to Utah Code Ann. § 48-3a-702.

Section 12.6 Deficit Capital Accounts

No Member shall be required to restore a deficit balance in such Member's Capital Account upon liquidation.

ARTICLE XIII - AMENDMENTS

Section 13.1 Amendments

This Agreement may be amended only by written instrument signed by [a Majority Interest/a Supermajority Interest/all Members].

Section 13.2 Amendment of Exhibits

Exhibit A may be amended by the [Manager(s)/Members] without the consent of all Members to reflect:

(a) Transfers of Membership Interests made in compliance with this Agreement;

(b) Changes in the Members' addresses;

(c) Admission of new Members;

(d) Changes in Percentage Interests resulting from additional Capital Contributions.

ARTICLE XIV - DISPUTE RESOLUTION

Section 14.1 Mediation

Any dispute arising out of or relating to this Agreement shall first be submitted to non-binding mediation in accordance with the mediation rules of [JAMS/AAA] before a single mediator in [Salt Lake City/[____]], Utah.

Section 14.2 Arbitration

☐ ARBITRATION REQUIRED

If mediation is unsuccessful within [thirty (30)] days, any dispute shall be resolved by binding arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association. The arbitration shall be conducted in [Salt Lake City/[____]], Utah, before a single arbitrator. The decision of the arbitrator shall be final and binding, and judgment may be entered in any court of competent jurisdiction.

☐ LITIGATION PERMITTED

If mediation is unsuccessful, the parties may pursue their claims in court as provided in Section 15.2.

Section 14.3 Attorneys' Fees

The prevailing party in any dispute arising under this Agreement shall be entitled to recover reasonable attorneys' fees and costs from the non-prevailing party.

ARTICLE XV - GENERAL PROVISIONS

Section 15.1 Governing Law

This Agreement shall be governed by and construed in accordance with the laws of the State of Utah, without regard to conflicts of law principles.

Section 15.2 Jurisdiction and Venue

Any legal action or proceeding arising out of or relating to this Agreement shall be brought exclusively in the state or federal courts located in [Salt Lake County/[____] County], Utah. Each party consents to the jurisdiction of such courts.

Section 15.3 Waiver of Jury Trial

☐ JURY WAIVER APPLICABLE

EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT TO A JURY TRIAL IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.

☐ NO JURY WAIVER

Section 15.4 Entire Agreement

This Agreement, together with the Exhibits attached hereto, constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes all prior agreements, understandings, negotiations, and discussions.

Section 15.5 Severability

If any provision of this Agreement is held to be invalid, illegal, or unenforceable, the remaining provisions shall continue in full force and effect.

Section 15.6 Notices

All notices required or permitted under this Agreement shall be in writing and shall be deemed delivered:

(a) When personally delivered;

(b) Three (3) business days after being sent by certified mail, return receipt requested;

(c) One (1) business day after being sent by overnight courier;

(d) Upon confirmation of receipt when sent by email (if email notice is authorized).

Notices shall be sent to the addresses set forth in Exhibit A or to such other address as a party may designate by notice.

Section 15.7 Binding Effect

This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, executors, administrators, successors, and permitted assigns.

Section 15.8 No Third-Party Beneficiaries

This Agreement is for the sole benefit of the parties hereto and their permitted successors and assigns, and nothing herein shall confer any rights upon any other Person.

Section 15.9 Counterparts

This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Electronic signatures shall be deemed valid and binding.

Section 15.10 Waiver

No waiver of any provision of this Agreement shall be effective unless in writing and signed by the waiving party. No waiver shall constitute a continuing waiver or a waiver of any other provision.

Section 15.11 Further Assurances

Each party shall execute and deliver such additional documents and instruments and take such further actions as may be reasonably necessary to effectuate the purposes of this Agreement.

Section 15.12 Construction

This Agreement shall be construed without regard to any presumption or rule requiring construction against the party causing this Agreement to be drafted.

EXECUTION

IN WITNESS WHEREOF, the undersigned have executed this Limited Liability Company Operating Agreement as of the date first written above.

COMPANY:

[COMPANY NAME], LLC

By: [________________________________]
Name: [________________________________]
Title: [________________________________]
Date: [__/__/____]

MEMBERS:

Member 1:

[________________________________]
Signature

[________________________________]
Print Name

Date: [__/__/____]

Member 2:

[________________________________]
Signature

[________________________________]
Print Name

Date: [__/__/____]

Member 3:

[________________________________]
Signature

[________________________________]
Print Name

Date: [__/__/____]

(Add additional signature blocks as needed)

EXHIBIT A - MEMBERS, CAPITAL CONTRIBUTIONS, AND PERCENTAGE INTERESTS

TOTAL: | | $[________________] | 100% | |

EXHIBIT B - MANAGERS

[FOR MANAGER-MANAGED COMPANIES ONLY]

EXHIBIT C - AGREED VALUE

[FOR BUYOUT PROVISIONS]

As of [__/__/____], the Members agree that the fair market value of the Company is:

$[________________________________]

This valuation shall be reviewed and updated [annually/upon the occurrence of a material event].

Signatures of all Members acknowledging agreed value:

[________________________________] Date: [__/__/____]

[________________________________] Date: [__/__/____]

[________________________________] Date: [__/__/____]

EXHIBIT D - SERIES SCHEDULE

[FOR SERIES LLCs ONLY]

This Operating Agreement is governed by the Utah Revised Uniform Limited Liability Company Act, Utah Code Ann. § 48-3a-101 et seq. Utah permits Series LLCs pursuant to Utah Code Ann. § 48-3a-1201 et seq. Annual renewal required with the Utah Division of Corporations and Commercial Code.