LIMITED LIABILITY COMPANY OPERATING AGREEMENT

by | Feb 20, 2023 | Samples legal papers

Lab X (LabX Group LLC)

LIMITED LIABILITY COMPANY OPERATING AGREEMENT

This Limited Liability Company Agreement (“Agreement”) of LabX Group LLC (the

“Company”), dated as of November 23, 2021 (the “Effective Date”), is made and entered into by

and among Ricardo C orreia  (”  RC”)  Tyrone Gomes (“TG”),  Keith Boyd  (“KB”)  Jessica
Landress (“JL”), and Zachary  Labonte,   who shall  becomes a    Member of the
Company in accordance with the  terms  and conditions  of this Agreement.  RC  TG, KB, JL
are  the  initial Managers. All references herein to the “Managers”  shall be construed to refer to
the Manager or Managers or both in office  at the relevant time, whether originally
named or later   appointed. RECITALS:            
                         

WHEREAS, the Company was formed under the Massachusetts Limited Liability Company Act (6 Del. C. §18-101, et seq.) (as from time to time amended, the “Act”); and

WHEREAS, the parties desire to formally document and set forth the respective rights and duties of the Members and the Managers of the Company.

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

ARTICLE I.

DEFINITIONS

In addition to any other capitalized terms defined in this Agreement, the following capitalized terms used in this Agreement shall have the meanings set forth below or in the section of this Agreement referred to below:

“AAA Rules”: the meaning set forth in Section 10.6.

“Act”: the meaning set forth in the recitals of this Agreement.

“Adjusted Capital Account Balance”: with respect to any Member, the balance of such

Member’s Capital Account after giving effect to the following adjustments:

  1. credit to such Capital Account such Member’s share of “partnership minimum gain” or “partner nonrecourse debt minimum gain” as such terms are defined in

Section 1.704-2 of the Treasury Regulations or any amount which such Member would be required to restore under this Agreement or otherwise; and

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

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

“Affiliate”: when used with reference to a specified Person, any Person that directly or indirectly controls or is controlled by or is under common control with the specified Person.

“Agreement”: this Limited Liability Company Agreement, as it may be amended, restated or supplemented from time to time as herein provided.

“Book Gain” or “Book Loss”: the gain or loss recognized by the Company for book purposes in any fiscal year or other period by reason of any sale or disposition with respect to any of the assets of the Company. Such Book Gain or Book Loss shall be computed by reference to the Book Value of such property or assets as of the date of such sale or disposition, rather than by reference to the tax basis of such property or assets as of such date, and each and every reference herein to “gain” or “loss” shall be deemed to refer to Book Gain or Book Loss, rather than to tax gain or tax loss, unless the context manifestly otherwise requires.

“Book Value”: with respect to any particular asset as of any particular date, the value at which the asset is properly reflected on the books and records of the Company as of such date in accordance with Section 1.704-1(b)(2)(iv) of the Treasury Regulations. The initial Book Value of each asset shall be its cost, unless such asset was contributed to the Company by a Member, in which case the initial Book Value shall be the amount established as its fair market value by agreement of the contributing Member and the other Members, and, in each case, such Book Value shall thereafter be adjusted for Depreciation with respect to such asset rather than for the cost recovery deductions to which the Company is entitled for Federal income tax purposes with respect thereto. The Book Values of all Company assets shall be adjusted to equal their respective fair market values, as determined in good faith by the Managers, as of the following times: (i) the acquisition of an additional interest in the Company by any new or existing Member in exchange for more than a de minimus additional Capital Contribution; and (ii) the distribution by the Company to a Member of more than a de minimus amount of Company assets, including money, if, as a result of such distribution, such Member’s interest in the Company is reduced.

“Capital Account”: the meaning set forth in Section 3.2.

“Capital Contributions”: the amount of cash and other property contributed to the Company by the Members.

“Certificate”: the Certificate of Formation of the Company as provided for pursuant to the Act, as amended and restated from time to time as herein provided.

“Class A Member”: means a Member holding a Class A Membership Interest, to the extent of such interest.

“Class A Membership Interest” or “Class A Units” means the Units designated and issued by the Company as Class A Units. On Company matters that require a vote of the Members, the Class A Units shall be entitled to vote.

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“Class B Member”: means a Member holding a Class B Membership Interest, to the extent of such interest.

“Class B Membership Interest” or “Class B Units”: means those Units designated and issued by the Company as the Class B Units. On Company matters that require a vote of the Members, the Class B Units shall not be entitled to vote.

“Code”: the Internal Revenue Code of 1986, as amended from time to time, and any subsequent Federal law of similar import, and, to the extent applicable, any Treasury Regulations promulgated thereunder.

“Company”: the meaning set forth in the preamble of this Agreement.

“Depreciation”: for each fiscal year or other period, an amount equal to the depreciation, amortization or other cost recovery deduction allowable with respect to an asset for such year or other period; provided, however, that if the Book Value of an asset differs from its adjusted basis for Federal income tax purposes at the beginning of any such year or other period, Depreciation shall be an amount that bears the same relationship to the Book Value of such asset as the depreciation, amortization, or other cost recovery deduction computed for tax purposes with respect to such asset for the applicable period bears to the adjusted tax basis of such asset at the beginning of such period, or if such asset has a zero adjusted tax basis, Depreciation shall be an amount determined under any reasonable method selected by the Managers.

“Effective Date”: the meaning set forth in the preamble of this Agreement.

“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 a recipient thereof and that may be directly reproduced in paper form by such a recipient through an automated process.

“Entity”: any general partnership, limited partnership, corporation, joint venture, trust, limited liability company, limited liability partnership, business trust, cooperative or association.

“Liquidation Value” means the amount of cash that any Member of the Company would receive if the Company sold all of its assets (including goodwill, going concern value, and any other intangibles associated with the operations of the Company) for cash equal to the fair market value of those assets and then liquidated.

“Major Decision”: means any decision with respect to the following matters with respect to the Company (a) merging or consolidating with any other Entity; (b) initiating any bankruptcy, receivership or similar proceeding; (c) initiating dissolution and/or winding up of the Company; (d) converting to a corporation or other form of Entity; (e) the sale of all or substantially all of the assets of the Company; (f) the acquisition of another business or Entity by the Company; (g) material changes in the business or business plan of the Company;

  1. valuation of assets contributed in-kind after the date of this Agreement and valuation of assets in the event of a book-up; (i) transactions between the Company and any Member or Manager, or any Affiliated Persons of a Member or Manager; (j) the incurring or refinancing of debt of the Company, either alone in the aggregate, in excess of $25,000; (k) entering into any

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contract which has a duration of more than one (1) year; (l) incurring any liability having a value in excess of $25,000; (m) the admission of any new Member; or (n) binding the Company or management of the Company to an agreement with any new or existing Member outside the terms of this Agreement, whether such terms reduce or enhance the rights of such Member under this Agreement. The foregoing notwithstanding, “Major Decision” shall not include any decision that one Manager has by the terms of this Agreement been specifically delegated the authority to make.

“Majority Interest”: one or more Members holding fifty-one percent (51%) of more of the Membership Interests.

“Majority Vote”: vote accumulating to fifty-one percent (51%) or more.

“Manager” and “Managers”: individually or collectively, all of such persons that are serving in such capacity at the time in question. Initially RC TG, KB, I.CFO, JL and OP shall be the Managers. Any change in the Managers shall be reflected on Exhibit A.

“Member”: each of the Persons executing this Agreement as a member of the Company, together with any Person who becomes a substituted or additional member as herein provided and who is listed as a Member of the Company in the books and records of the Company, in such Person’s capacity as a Member of the Company.

“Membership Interest”: the entire legal and equitable ownership interest of a Member in the Company at any particular time.

“Percentage Interest”: means, with respect to any Member, a fraction (expressed as a percentage) the numerator of which is the total Membership Interests owned by such Member and the denominator of which is the total Membership Interests owned by all Members, in each case as set forth on Exhibit A hereto, as the same may be amended from time to time.

“Person”: means any individual or Entity, and the heirs, executors, administrators, legal representatives, successors and assigns of such Person where the context so admits.

“Profit and Loss”: for each fiscal year or other period, an amount equal to the Company’s taxable income or loss for such year or period, determined in accordance with Section 703(a) of the Code (provided that for this purpose, all items of income, gain, loss, or deduction required to be stated separately pursuant to Section 703(a)(1) of the Code shall be included in taxable income or loss), with the following adjustments:

  1. Any income of the Company that is exempt from Federal income tax and not otherwise taken into account in computing Profit or Loss pursuant to this provision shall be added to such taxable income or loss;
  1. Any expenditures of the Company described in Section 705(a)(2)(B) of the Code or treated as Code Section 705(a)(2)(B) expenditures pursuant to Section 1.704-1(b)(2)(iv)(i) of the Treasury Regulations, and not otherwise taken into account in computing Profit or Loss pursuant to this provision, shall be subtracted from such taxable income or loss;

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  1. Book Gain or Book Loss shall be taken into account in lieu of any tax gain or tax loss recognized by the Company by reason of any sale or disposition of an asset of the Company;
  1. In lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such fiscal year or other period, computed as provided in this Agreement; and
  1. Any items that are specially allocated pursuant to Section 5.6 or Section 5.7 shall not be taken into account in computing Profit and Loss.

If the Company’s taxable income or loss for such fiscal year or other period, as adjusted in the manner provided above, is a positive amount, such amount shall be the Company’s Profit for such period; and if a negative amount, such amount shall be the Company’s Loss for such period.

If the Book Value of the Company assets is adjusted pursuant to the last sentence of the definition of Book Value, the amount of such adjustment shall be included in computing Profit or Loss. If any Company asset is distributed in kind (whether in connection with the liquidation of the Company or otherwise), the Company shall be deemed to have realized Profit or Loss thereon in the same manner as if the Company had sold such asset for an amount equal to its fair market value on the date of distribution, as determined in good faith by the Managers.

“Regulatory Allocations”: the meaning set forth in Section 5.7.

“Safe Harbor”: means the safe harbor described in the Safe Harbor Revenue Procedure.

“Safe Harbor Election”: means a written election, attached to the tax return of the Company for the taxable year that includes the effective date of the election, prepared by the Company, and executed by a Member having responsibility for federal income tax reporting by the Company, stating that the Company is electing, on behalf of the Company and each of its Members to have the Safe Harbor apply irrevocably with respect to all interests in the Company transferred in connection with the performance of services while the election remains in effect, and specifying the effective date of the election, which effective date may not be prior to the date that the election is executed.

“Safe Harbor Revenue Procedure”: means the Internal Revenue Service revenue procedure that represents the promulgation by the Internal Revenue Service in final form of the proposed revenue procedure set forth in Internal Revenue Service Notice 2005-43 (and any other pronouncement of the Internal Revenue Service in temporary or final form and pertaining to the election of any safe harbor in connection with the receipt of a partnership interest (or an interest in any entity classified as a partnership for federal income tax purposes) in connection with the performance of services).

“Tax Matters Partner”: the meaning set forth in Section 4.5.

“Transfer”: in the context of a transfer of a Membership Interest, the sale, assignment, pledge, hypothecation, transfer or other voluntary disposition (by gift, bequest or otherwise, and

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whether as security or otherwise) by a Member of all or a portion of its Membership Interest, whether directly or indirectly (including through the Transfer of interests in any Member that is an Entity).

“Treasury Regulations”: the Federal income tax regulations, including any temporary or proposed regulations, promulgated under the Code, as such Treasury Regulations may be amended from time to time (it being understood that all references herein to specific sections of the Treasury Regulations shall be deemed also to refer to any corresponding provisions of succeeding Treasury Regulations).

“Units”: the Units of Membership Interest issued and sold by the Company pursuant to Section 3.1 and includes Class A Units and Class B Units as the context permits or requires.

“Voting Interests”: the issued and outstanding Class A Membership Interests.

“Year”: the meaning set forth in Section 4.1.

ARTICLE II.

FORMATION OF LIMITED LIABILITY COMPANY

2.1 Formation. The parties, by execution of this Agreement, each hereby acknowledge the formation of the Company as a limited liability company under and pursuant to the Act.

2.2 Company Name. The name of the Company shall be LabX (LabX Group LLC). The business of the Company may also be conducted under such other name or names as may from time to time be approved by the Managers.

2.3 The Certificate. The Managers or their authorized predecessors have caused the Certificate to be filed with the Secretary of State of the State of Massachusetts. The Members and Managers hereby agree to execute, file and record (as a Member or as a Manager, as may be required) all such other certificates and documents, including amendments to the Certificate, and to do such other acts as may be appropriate to comply with all requirements for the formation, continuation and operation of a limited liability company, the ownership of property, and the conduct of business under the laws of the State of Massachusetts and any other jurisdiction in which the Company may own property or conduct business.

Principal Business Office, Registered Office and Agent for Services of Process. The principal business office of the Company shall be in Massachusetts. The Registered Agent of the Company in the State of Massachusetts is Rico Correia, with an address of 95 Puritan Way New Bedford Ma 02745. The principal business office, the Massachusetts Registered Agent and the Massachusetts Agent for Service of Process of the Company may be changed from time to time by the Managers and in accordance with the then applicable provisions of the Act and any other applicable laws.

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2.4 Term of the Company. The term of the Company commenced on the Effective Date and shall continue unless and until it is sooner dissolved pursuant to the provisions of Section 9.1.

2.5 Purposes. The purpose of the Company is to test cannabis products for the Lab X in the Massachusetts market and to do all things necessary or convenient thereto; provided, however, that the Company may engage in any and all other activities in which a limited liability company formed under the Act may engage in.

2.6 Powers. In furtherance of its purposes, but subject to all of the provisions of this Agreement, including without limitation provisions relating to Major Decisions, the Company shall have the power and is hereby authorized to:

  1. acquire any real or personal property which may be necessary, appropriate, convenient or incidental to the accomplishment of the purposes of the Company;
  1. enter into, execute, acknowledge and deliver all such agreements, documents, certificates and other instruments as shall be necessary, appropriate or convenient in connection with the conduct of the Company’s business generally;
  1. borrow money and issue evidences of indebtedness in furtherance of any or all of the purposes of the Company and secure the same by mortgage, security interest, pledge or other lien in respect of any assets of the Company;
  1. invest  any  funds  of  the  Company  pursuant  to  the  provisions  of  this

Agreement;

  1. prepay in whole or in part, refinance, recast, increase, modify or extend any indebtedness of the Company, and in connection therewith execute any extensions, renewals or modifications of any mortgage securing such indebtedness;
  1. open, maintain and close bank accounts and draw checks and other orders for the payment of money;
  1. enter into, make and perform such contracts, agreements, leases and other undertakings, and do such other acts, as may be necessary or advisable for the conduct of the business of the Company, including, without limiting the generality of the foregoing, contracts, agreements, undertakings and transactions with any partner or with any other Person, having any business, financial or other relationship with any Manager or Member;
  1. establish reserves for working capital and other Company needs out of the profits or other income or capital received;
  1. enter into partnerships or other ventures with other Persons in furtherance of the purposes of the Company;

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  1. engage counsel, accountants, custodians, consultants, brokers or such other Persons as may be necessary or advisable to the conduct of the business and affairs of the Company;
  1. maintain one or more offices and in connection therewith rent or acquire office space, equipment and fixtures, engage personnel and do such other acts as may be advisable or necessary in connection with such offices, equipment, fixtures and personnel;
  1. reorganize the Company in one or more jurisdictions other than the State of Massachusetts if the Managers determine that such action would be in the best interests of the Company; and
  1. do such other things and engage in such other activities related to the foregoing as may be necessary, convenient or advisable with respect to the conduct of the business of the Company, and have and exercise all of the powers and rights conferred upon limited liability companies formed pursuant to the Act.

ARTICLE III.

CAPITALIZATION

3.1 Authorized Units.

  1. The Membership Interests in the Company shall be represented by Units. One Hundred Thousand (100,000) Units are hereby initially authorized, which shall be designated at the time of issuance as either Class A Stock Units or Class B Stock Units and shall be issued in such amounts as the Managers may determine, so long as such designation and issuance is done in accordance with the terms and

conditions of this Agreement, including, without limitation, the obligations to obtain appropriate consents for any Major Decisions.

  1. As of the Effective Date, the Members of the Company, the type and number of Units held by each Member, and their respective Voting Interests and Percentage Interests are set out on Exhibit A, attached hereto.
  1. Class A Units shall be entitled to vote on all matters requiring Member approval pursuant to this Agreement or the Act. Class A Units and Class B Units shall have the respective Percentage Interest attributable to such Units. The Class A Units and Class B Units shall have the same rights to distributions. The Managers of the Company may offer to certain Members designated by Managers the right to prior notice of certain actions taken by the Managers on behalf of the Company prior to taking such action; provided, however, that any such agreement must be in writing with such Member(s), shall be deemed a Major Decision to be approved by the Managers in accordance with this Agreement; and provided further, however, that such agreement shall not to create any separate class of Units, nor right to any special distributions other than distributions to such Member(s) as a holders of, as the case may be, Class A Units or Class B Units.

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  1. Except for the Capital Contributions agreed to be made by a Member in writing, or made by a Member, no Member shall have any obligation to make any further Capital Contribution to the Company. In the event that any Person or Member fails to make any required contribution of cash when due, the Managers (i) may reduce the

Interest held by such Member to an amount appropriate in light of such Member’s actual contribution; (ii) shall have the right, but not the obligation, to make arrangements with any other Person or Member pursuant to this Article 3 to contribute amounts needed to make up for the failure of such Member to make his or her contribution and charge any and all costs incurred by having to make such alternative financial arrangements against the Interest or Capital Account of such Member that failed to make its contribution; and/or (iii) the Managers may deem that such Member not to be admitted and return any amounts so contributed, less any costs incurred by or on behalf of the Company as a result of such failure.

  1. Each Member making a Capital Contribution hereby warrants and represents that it has the full power and authority to contribute to the Company all of the assets comprising such contribution (the “Contributed Assets”) free and clear of all liens and encumbrances and agrees to provide the Company with any and all further documentation to ensure that the Company has clear title to such Contributed Assets. The Member contributing the Contributed Assets shall discharge all of the liabilities and obligations associated with the Contributed Assets, including, without limitation, all income tax and other liabilities associated with such assets that have accrued prior to the date of or as a result of the contribution of such assets. The Member that contributes the Contributed Assets shall defend, indemnify and hold the Company and the other Members harmless from and against any and all damages incurred or suffered by the Company and/or the other Members arising out of any claims or undischarged liabilities that accrue with respect to the Contributed Assets prior to the date of or as a result of the contribution of such assets, whether or not such claims or liabilities were known to the Member at the time of making such contribution. In the event that any Person or Member fails to discharge any liabilities required to be discharged with respect to such Contributed Assets, then the Percentage Interest of such Member shall be reduced to an amount appropriate in light of such Member’s actual contribution and/or to the extent of the undischarged liability on such Contributed Assets, and if such Member and the Managers cannot agree on such amount, the matter will be determined by arbitrators acting pursuant to Section 10.6.

3.2 Capital Accounts. A separate capital account (a “Capital Account”) shall be established and maintained for each Member in accordance with the following provisions:

  1. To each Member’s Capital Account there shall be credited the amount of cash and fair market value of the property actually contributed to the Company pursuant to any provision of this Agreement, such Member’s allocable share of Profit and the amount of any Company liabilities that are assumed by such Member or that are secured by any Company property distributed to such Member.
  1. To each Member’s Capital Account there shall be debited the amount of cash and the fair market value of any Company property distributed to such Member

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pursuant to any provision of this Agreement, such Member’s allocable share of Loss and the amount of any liabilities of such Member that are assumed by the Company or that are secured by any property contributed by such Member to the Company.

  1. The provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Section 1.704-1(b)(2)(iv) of the Treasury Regulations, and shall be interpreted and applied in a manner consistent with such Treasury Regulations.
  1. A Member shall not be entitled to withdraw any part of its Capital Account or to receive any distributions from the Company except as provided in Article 6; nor shall a Member be entitled to make any loan or Capital Contribution to the Company other than as expressly provided herein. No loan made to the Company by any Member shall constitute a Capital Contribution to the Company for any purpose.
  1. Except as required by the Act, no Member shall have any liability for the return of the Capital Contribution of any other Member.

3.3 Transfer of Capital Accounts. The original Capital Account established for each substituted Member shall be in the same amount as the Capital Account of the Member which such substituted Member succeeds, at the time such substituted Member is admitted to the Company. The Capital Account of any Member whose interest in the Company shall be increased by means of the transfer to it of all or part of the interest in the Company of another Member shall be appropriately adjusted to reflect such Transfer. Any reference in this Agreement to a Capital Contribution of or distribution to a then Member shall include a Capital Contribution or distribution previously made by or to any prior Member on account of the interest in the Company of such prior Member.

3.4 Deficit Capital Accounts. No Member with a deficit in his Capital Account shall be obligated to restore such deficit balance or make a Capital Contribution to the Company solely by reason of such deficit.

ARTICLE IV.

BOOKS; ACCOUNTING; TAX ELECTIONS; REPORTS

4.1 Fiscal Year. The fiscal year of the Company shall be the calendar year (the “Year”), or such other year as shall be required under the Code or determined by the Managers.

4.2 Method of Accounting. The books of account of the Company shall be maintained in accordance with such method or methods of accounting as the Managers shall determine.

4.3 Books and Records and Inspection.

  1. Books of Account and Records. Proper and complete records and books of account of the Company’s business, including all such transactions and other matters as are usually entered into records and books of account maintained by Persons engaged in businesses of like character or as are required by law, shall be kept by the Company at

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the Company’s principal office and place of business. To the extent required by law, the Company shall also keep, at its principal office and place of business, all records required by the Act.

  1. Inspection. All records and documents described in Section 4.3(a) shall, at reasonable intervals, be open to inspection and copying upon at least five (5) business days’ prior written notice by any of the Members or their representatives at any reasonable time during business hours and at such Member’s expense.

4.4 Financial Statements. If requested by any Member, the Managers shall deliver or cause to be delivered to each Member, within ninety (90) days after the end of each Year a balance sheet for the Company as of the end of such Year, and the related statements of income and Members’ capital for the Company for such Year, all in reasonable detail.

4.5 Filing of Returns and Other Writings; Tax Matters Partner and Representative. The Managers shall cause the preparation and timely filing of all Company tax returns and shall, on behalf of the Company, timely file all other writings required by any governmental authority having jurisdiction to require such filing. Except with the approval of the Majority Interest, the Managers shall not make (and no other Member shall make) any election or other filing with any taxing or governmental authority (including but not limited to an election or filing pursuant to Treasury Regulations Section 301.7701-3) that would cause the Company to be classified as an association taxable as a corporation for federal income tax purposes. Unless and until the Managers shall otherwise determine, RC shall serve as the “tax matters partner” for purposes of Section 6231 of the Code and, as relevant, the “tax matters representative” as defined in Section 6223 of the Code; provided, however, that no material action shall be taken by the “tax matters partner” (or the “tax matters representative”) without the prior consent of a Majority. It is the intention of the Members that the Company file an election pursuant to Code Section 6226, as amended by Sec. 1101(g) of P.L. 114-74 (related to revised federal income tax audit procedures), as soon as reasonably practicable after the provisions thereof become effective. The tax matters partner (and, as relevant, the tax matters representative) shall send to each Member a copy of all notices sent to the Company by the Internal Revenue Service or other state or local tax authority.

4.6 Safe Harbor Election. The Company is authorized and directed to make the Safe Harbor Election as soon as is reasonably practicable after the promulgation of the Safe Harbor Revenue Procedure. The Company and each of its Members shall comply with all requirements of the Safe Harbor with respect to all interests in the Company transferred in connection with the performance of services while the Safe Harbor Election remains effective, including without limitation using the Liquidation Value as the fair market value of said interest for purposes of Section 83 of the Code.

ARTICLE V.

ALLOCATIONS

5.1 Allocations of Profit and Loss. After giving effect to the special allocations set forth in Section 5.6 and taking into account any curative allocations in Section 5.7, Profit and Losses of the Company for each fiscal year or other period shall be allocated among the Members in accordance with their Percentage Interests.

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5.2 Section 754 Election. Upon an election by the Managers, in their sole discretion, the Company shall elect, pursuant to Section 754 of the Code, to adjust the basis of Company property as permitted and provided in Sections 734 and 743 of the Code. Such election shall be effective solely for Federal (and, if applicable, state and local) income tax purposes and shall not result in any adjustment to the Book Value of any Company asset or to the Members’ Capital Accounts (except as provided in Treasury Regulations Section 1.704-1(b)(2)(iv)(m)) or in the determination or allocation of Profit or Loss for purposes other than such tax purposes.

5.3 Allocations for Tax and Book Purposes. Except as otherwise provided herein, any allocation to a Member for a fiscal year or other period of a portion of the Profit or Loss, or of a specially allocated item, shall be determined to be an allocation to that Member of the same proportionate part of each item of income, gain, loss, deduction or credit, as the case may be, as is earned, realized or available by or to the Company for Federal tax purposes.

5.4 Certain Accounting Matters. For purposes of determining Profit, Loss or any other items allocable to any period, Profit, Loss and any such other items shall be determined on a daily, monthly or other basis, as determined by the Managers using any permissible method under Section 706 of the Code and the Treasury Regulations promulgated thereunder.

5.5 Tax Allocations; Code Section 704(c). In accordance with Section 704(c) of the Code and the Treasury Regulations promulgated thereunder, income, gain, loss, and deduction with respect to any property contributed to the capital of the Company shall, solely for income tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of such property to the Company for Federal income tax purposes and its fair market value at the time of contribution. In the event that the Book Value of any Company asset is subsequently adjusted in accordance with the last sentence of the definition of Book Value, any allocation of income, gain, loss and deduction with respect to such asset shall thereafter take account of any variation between the adjusted tax basis of the asset to the Company and its Book Value in the same manner as under Section 704(c) of the Code and any Treasury Regulations promulgated thereunder. Any elections or other decisions relating to such allocations shall be made by the Managers in a manner that reasonably reflects the purpose and intention of this Agreement. Allocations pursuant to this section are solely for purposes of Federal, state, and local taxes and shall not affect, or in any way be taken into account in computing, any Members’ Capital Account or share of Profit, Loss or distributions pursuant to any provision of this Agreement.

5.6 Compliance With Section 704(b).

  1. Qualified Income Offset. If any Member unexpectedly receives an adjustment, allocation or distribution described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6) that causes the Member to have, or increases the amount of a Member’s, deficit Adjusted Capital Account Balance, items of Company income and gain shall be specially allocated to such Member in accordance with the requirements of Regulations Section 1.704-1(b)(2)(ii)(d). This Section 5.6(a) is intended to comply with the qualified income offset provision of such Regulations Section, and shall be interpreted consistently therewith.

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  1. Gross Income Allocation. If any Member would otherwise have a deficit Adjusted Capital Account Balance as of the last day of any fiscal year or other period, items of income and gain of the Company shall be specially allocated to such Member (in the manner specified in Section 5.6(a) hereof) so as to eliminate such deficit Adjusted Capital Account Balance as quickly as possible, provided that an allocation pursuant to this Section 5.6(b) shall be made only if and to the extent that such Member would have a deficit Adjusted Capital Account Balance after all other allocations provided for in this Agreement have been tentatively made as if this Section 5.6(b) were not in this Agreement.
  1. Limitation on Loss Allocations. No item of deduction or loss of the Company shall be allocated to a Member if such allocation would cause or increase a deficit Adjusted Capital Account Balance. In the event that some but not all of the Members would have deficit Adjusted Capital Account Balances as a result of an allocation of Loss pursuant to this Article 5, the limitation set forth in this Section 5.6(c) shall be applied on a Member by Member basis so as to allocate the maximum permissible Loss to each Member under Regulations Section 1.704-1(b)(2)(ii)(d).
  1. Minimum Gain Chargeback. Notwithstanding any other provision of this Article 5, if there is a net decrease in “partnership minimum gain” or “partner nonrecourse debt minimum gain” of the Company (as such terms are defined in Regulations Section 1.704-2) during any fiscal year or other period, prior to any other allocation pursuant hereto, items of Company income and gain for such fiscal year or other period (and, if necessary, for subsequent fiscal years or periods) shall be specially allocated among the Members in accordance with Regulations Sections 1.704-2(f) and

(i). The items to be so allocated shall be determined in accordance with Regulations Sections 1.704-2(f)(6) and (j)(2).

  1. Allocation of “Partner Nonrecourse Deductions”. “Partner nonrecourse deductions” as defined in Section 1.704-2(i)(1) of the Treasury Regulations for any fiscal year or other period shall be specially allocated to the Members who bear the economic risk of loss for the “partner nonrecourse debt” to which such “partner nonrecourse deductions” are attributable, as provided in Section 1.704-2(i)(1) of the Treasury Regulations.
  1. Allocation of “Nonrecourse Deductions”. “Nonrecourse deductions” as such term is defined in Section 1.704-2(b)(1) of the Treasury Regulations for any fiscal year or other period shall be allocated to the Members in accordance with their respective Pro Rata Percentages.

5.7 Curative Allocations. The allocations set forth in Section 5.6 (the “Regulatory Allocations”) are intended to comply with certain requirements of Sections 1.704-1(b) and 1.704-2 of the Treasury Regulations. The Regulatory Allocations may not be consistent with the manner in which the Members intend to divide Company Profits, Losses and similar items and to make distributions. Accordingly, Profits, Losses and other items will be reallocated among the Members (in the same year, and to the extent necessary, in subsequent years) in a manner consistent with Treasury Regulation section 1.704-1(b) and 1.704-2 so as to prevent the

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Regulatory Allocations from distorting the manner in which Company Profits, Losses and other items are intended to be allocated among the Members pursuant to this Article 5 or the manner in which distributions are intended to be made among the Members pursuant to Article 6.

ARTICLE VI.

DISTRIBUTIONS

6.1 Distributions other than in Liquidation.

  1. Distributions shall be made to the Members, pro rata and pari passu, in accordance with the Members’ Percentage Interests.
  1. The Company shall, to the extent permitted by law, distribute amounts to the Members sufficient for the Members to pay federal, state and local income taxes on their allocable shares of taxable income of the Company not distributed to the Members (however, the Managers may determine in good faith that such profits are not subject to tax because of offsets against previous Loss allocations). The amount of each Member’s tax liability shall be determined by the Company based upon the highest marginal federal and Massachusetts income tax rates for an individual, without regard to taxable exemptions or deductions. Such distributions, if any, shall be made at the times and in the amounts determined in the sole discretion of the Managers, but no later than the 1st of January following the end of each Year with respect to which such payment is due.

6.2 Distributions in Liquidation. The net proceeds derived from any transaction involving the sale or other disposition of all or substantially all of the assets of the Company, together with any cash determined by the Managers to be available for distribution to the Members during the period of winding up of the Company, shall be applied and distributed in the following order of priority:

  1. first, to the payment of any debts and liabilities of the Company;
  1. next, to the setting up of reserves to provide for any contingent, conditional or unmatured liabilities or obligations of the Company;
  1. next, to the Members in proportion to and to the extent of the positive balances of the Capital Accounts of the Members (after reflecting in such Capital Accounts all adjustments thereto necessitated by all Company transactions for the fiscal year or other period of the Company in which the liquidation of the Company occurs prior to or simultaneously with such distribution); and
  1. finally to the Members in accordance with their Percentage Interests.

All payments under this Section 6.2 shall be made as soon as reasonably practicable and in any event by the end of the fiscal year in which such liquidation or winding up occurs or, if later, within ninety (90) days after the date of such liquidation or the date such winding up occurs.

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ARTICLE VII.

RIGHTS AND OBLIGATIONS OF MEMBERS AND THE MANAGERS

7.1 Limited Liability of Members. Except as otherwise provided by the Act, and subject to any capital contribution obligations of the Members, the debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and the Members shall not be obligated personally for any such debt, obligation or liability of the Company solely by reason of being a Member of the Company. Each of the Members shall only be liable to make payment of its respective contributions as and when due hereunder and other payments as expressly provided in this Agreement. If and to the extent a Member’s contribution shall be fully paid, such Member shall not, except as required by the express provisions of the Act regarding repayment of sums wrongfully distributed to Members, be required to make any further contributions. No Member in his capacity as such shall have the authority to act for or bind the Company.

7.2 The Managers.

  1. In General. The Company shall initially have four (4) Managers, to be appointed by the Class A Members. The Class A Members hereby appoint RC KB, TG, JL, as Managers. Except as otherwise provided for herein, the Managers shall, on behalf of the Company, make all decisions affecting the Company’s affairs and business, perform any and all other acts necessary, appropriate, convenient or advisable to the management of the Company’s affairs, business and assets; provided, however, that whenever there is only one (1) Manager, such Manager may, singly, exercise and act on behalf of the Company with full authority, whenever there are exactly two (2) Managers, the two (2) Managers together two shall have joint authority to act, and whenever there are more than two (2) managers, any action by the Managers shall require the consent and vote of the holders of not less than a Majority Interest. The Managers shall not be personally liable for any of the debts, obligations, liabilities or contracts of the Company taken in accordance with this Agreement. A Manager may resign at any time by written notice thereof to the Company. A Manager may be removed only by a vote of the holders of not less a Majority Interest. Following any such removal, the appointment of any successor Manager(s) shall require a vote of the holders of not less than a Majority Interest.
  1. Compensation and Reimbursement. The Managers shall be entitled to reimbursement for actual, out-of-pocket costs incurred by the Managers for fees and expenses paid to third parties on behalf of the Company. The Managers shall receive no compensation for acting as Managers.

7.3 Officers. The Managers may appoint themselves or others as officers or as authorized persons (“Officers”) and delegate to such Officers authority to take or implement such actions on behalf of the Company as the Managers may direct, subject, however, to the limitations on the authority of the Managers under this Agreement.

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7.4 Authority; Evidence of Authority.

  1. Subject to the other provisions of this Agreement, the Managers shall have the authority to execute on behalf of the Company all agreements, contracts, instruments and other documents, including, without limitation: (i) deeds of trust and assignments of rights; (ii) contracts for the purchase or sale of assets, stock purchase agreements, deeds, leases, assignments and bills of sale; and (iii) loan commitments, loan agreements, mortgages, security agreements, pledge agreements, financing statements and loan draw requests. The foregoing and anything else in this Agreement to the contrary notwithstanding, all Major Decisions shall require the written consent of the number of Managers required pursuant to Section 7.2(a).
  1. Any Person dealing with the Company may rely on a certificate signed by

a Manager:

  1. as to who are the Members, the Managers and agents of the

Company;

  1. as to the existence or nonexistence of any fact or facts which constitute conditions precedent to acts by the Members or the Managers or agent or in any other manner germane to the affairs of the Company;
  1. as to who is authorized to execute and deliver any instrument or document on behalf of the Company;
  1. as to the authenticity of any copy of this Agreement and amendments hereto;
  1. as to any act or failure to act by the Company or as to any other matter whatsoever involving the Company, any Member, the Managers or agent; or
  1. as to the authority of any Member, any Manager or any employee or agent or other Person to act on behalf of the Company.

provided, however, that the Manager(s) signing such statement shall be responsible to the Company and the Members for the accuracy of such statement.

7.5 Other Business.

  1. The Managers shall devote to the Company such amount of time and attention as is reasonably appropriate to carry out the purposes of the Company. The Managers and the Members may engage in or possess interests in other business ventures, independently or with others.
  1. No Person shall use any proprietary or confidential information owned by the Company other than for the benefit of the Company, whether or not such Person remains a Member, Affiliate or Manager of the Company.

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7.6 Standard of Care. To the extent that, at law or in equity, a Manager or any Member or any Affiliate of a Member or any Manager or any director, officer, stockholder, employee, agent or representative of a Member or Manager or such Affiliate has duties (including fiduciary duties) and liabilities to the Company or to the Members, no such Person shall be liable to the Company or to any Member or Manager for its good faith reliance on the provisions of this Agreement. The provisions of this Agreement, to the extent that they expand or restrict the duties and liabilities of any such Person otherwise existing at law or in equity, are agreed by the Members and the Managers to replace such other duties and liabilities of such Person.

7.7 Indemnification. None of the Members, the Managers (each a “Covered Person”) shall be liable to any other Covered Person or any other Person who has an interest in the Company for any loss, damage or claim incurred by reason of any act or omission performed or omitted by such Covered Person in good faith and in a manner reasonably believed to be within the scope of the authority conferred on such Covered Person, except that a Covered Person shall be liable for any such loss, damage or claim incurred by reason of their gross negligence or willful misconduct or breach of this Agreement. To the full extent permitted by applicable law, a Covered Person shall be entitled to indemnification from the Company for any loss, damage or claim by reason of any act or omission performed or omitted by such Person in good faith on behalf of the Company and, as applicable, in a manner reasonably believed to be within the scope of the authority conferred on it by this Agreement, except that no Covered Person shall be entitled to be indemnified in respect of any loss, damage or claim as to which such Covered Person has been adjudicated in any proceeding to have not acted in good faith in the reasonable belief that his actions were in the best interests of the Company or consistent with his obligations hereunder; provided, however, that any indemnity under this Section 7.7 shall be provided out of and to the extent of Company assets only and no Member shall have personal liability on account thereof.

7.8 Agreements with Affiliates. Subject to the other terms of this Agreement, the Company may enter into agreements with a Manager or Member for the acquisition of property or rendition of services, provided that the acquisition of such property from, or the rendition of such services by, a Manager or Member is pursuant to a written agreement which describes the subject matter thereof and all compensation payable thereunder and is on terms generally no less favorable to the Company than it could have obtained in a comparable arms-length transaction with a person who is unrelated to a Manager or Member.

ARTICLE VIII. TRANSFERS

OF INTERESTS;

AND ADDITION OF NEW MEMBERS

8.1 Transfers of Membership Interests. Except as otherwise set forth herein, no Member may Transfer any portion of its Membership Interest without the consent of the Managers and unless and until the requirements for admission of additional Members set forth in this Article 8 have been satisfied. Any attempted Transfer by a Person of a Membership Interest or any part thereof, other than in accordance with this Article 8 shall be, and is hereby declared, null and void ab initio.

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8.2 Certain Transfers. Subject to and/or in addition to the other terms of this Agreement, additional Persons may be admitted to the Company as Members upon the approval of the Managers, in their sole discretion. The terms of admission must specify the Percentage Interest and initial Capital Contribution, if any, applicable thereto. The foregoing and anything else in this Agreement to the contrary notwithstanding, any Member may Transfer all or part of such Member’s Membership Interest to the spouse, issue or other family member of such Member or to a trust or similar entity established for such Member or Persons solely for estate planning purposes or upon the death of an individual Member, provided further that the Managers first unanimously approve any such Transfer, such approval not to be unreasonably withheld or delayed; provided, however, that the Managers may condition such approval upon a commitment from the Member proposing to make such Transfer to continue to vote and manage such Membership Interest and remain active in the Company, as if such transferring Member continued to own the Membership Interest proposed to be Transferred.

8.3 Admission of Additional Members. Notwithstanding the provisions of Sections 8.1 and 8.2 above, if any Person acquires all or any portion of a Membership Interest as a result of a Transfer, or acquires a Membership Interest directly from the Company, such Person shall not be admitted to the Company as a Member unless and until the Managers have received, on behalf of the Company, a document, in a form reasonably satisfactory to the Managers:

  1. executed by such Person; (ii) including the notice address of such Person; (iii) setting forth the Capital Contribution (if applicable), and the number and type of Units of such Person upon consummation of such acquisition; (iv) containing an agreement by such Person to be bound by the terms of this Agreement with respect to the Membership Interest to be acquired; and
  1. containing representations and warranties consistent with those set forth herein and in compliance with applicable securities laws.

8.4 Corresponding Changes to Agreements. If, pursuant to the provisions of this Agreement, a new Member is admitted to the Company or a Membership Interest is transferred, in each case in whole or in part in a permitted manner, then the Members and the transferee consent to the Managers’ amendment of this Agreement and Exhibit A hereto and shall cooperate to amend any other agreements, if necessary, to reflect such event.

8.5 Obligations and Rights of Transferees and Assignees. Any Person who acquires in any manner whatsoever the Membership Interest (or any part thereof) of any Member in the Company, irrespective of whether such Person has accepted and assumed in writing the terms and provisions of this Agreement, shall be deemed, by acceptance of the benefit of the acquisition thereof, to have requested and agreed to be subject to and bound by all of the obligations of this Agreement, with the same force and effect as any predecessor in interest in the Company, shall have only such rights as are provided in this Agreement, and, without limiting the generality of the foregoing, such Person shall not have the value of his interest ascertained or receive the value of such interest, or, in lieu thereof, profits attributable to any right in the Company, except as set forth in this Agreement. In addition, notwithstanding any provision in this Agreement to the contrary, any transferee or assignee of any Interest in the Company shall be bound by a Safe Harbor Election made by the Company.

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8.6 Resignation and Withdrawal. Except as otherwise set forth in this Agreement, no Member shall have the right to resign or withdraw from the Company except upon the prior consent of the Managers.

ARTICLE IX.

TERMINATION

9.1 Events of Dissolution.

  1. In accordance with the Act, the Company shall be dissolved and the affairs of the Company wound up upon the occurrence of any of the following events:
  1. a vote of Members  holding  a Majority Interest to dissolve the

Company;

  1. the sale, exchange, condemnation or involuntary transfer of all or substantially all of the assets of the Company; provided that this Section 9.1(a)(ii) shall not apply if part of the consideration received by the Company in connection with any such event includes deferred payment obligations and the Managers reasonably determine that it is in the best interest of the Members to keep the Company in existence for the sole purpose of collecting amounts payable under such obligations and distributing such amounts in accordance with the terms of this Agreement, upon the satisfaction of which obligations the Company shall dissolve;
  1. death, incapacity, resignation, expulsion, bankruptcy or dissolution of a Member or the occurrence of any other event which, pursuant to the Act, terminates the continued membership of a Member in the Company, if the Company would, as a result of such event, have fewer than the number of Members that a limited liability company must have under the Act to continue; and
  1. the entry of a decree of judicial dissolution under the Act.
  1. Dissolution of the Company shall be effective on the day on which the event occurs giving rise to the dissolution, but the Company shall not terminate until the assets of the Company shall have been distributed as provided herein and a certificate of cancellation of the Company has been filed with the Secretary of State of the State of Massachusetts.

9.2 Procedures Upon Dissolution.

  1. General. If the Company dissolves, it shall commence winding up pursuant to the appropriate provisions of the Act and the procedures set forth in this Section 9.2. Notwithstanding the dissolution of the Company, prior to the termination of the Company, the business of the Company and the affairs of the Members, as such, shall continue to be governed by this Agreement.

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  1. Control of Winding Up. The winding up of the Company shall be conducted under the direction of the Managers or their designee(s) (the Managers or their designee(s), the “Liquidator”); provided, however, that if there is more than one Manager, no Manager who caused the dissolution of the Company in contravention of this Agreement and no Manager whose Member Affiliate caused the dissolution pursuant to Section 9.1(a)(iii) shall participate in the control of the winding up of the Company, and provided, further, that if the dissolution is caused by entry of a decree of judicial dissolution pursuant to Section 9.1(a)(iv), the winding up shall be carried out in accordance with such decree.
  1. Manner of Winding Up. The Company shall engage in no further business following dissolution other than that necessary for the orderly winding up of the business and distribution of assets. The maintenance of offices shall not be deemed a continuation of the business for purposes of this Section 9.2(c). Upon dissolution of the Company, the Liquidator shall determine the time, manner and terms of any sale or sales of Company property pursuant to such winding up, consistent with its fiduciary responsibilities and having due regard to the activity and condition of the relevant market and general financial and economic conditions.
  1. Application of Assets. In the case of the dissolution of the Company, the

Company’s assets shall be applied as set forth in Section 6.2 and then to the Members’ positive Capital Account Balances.

9.3 Termination of Company. Upon the completion of the liquidation of the Company and the distribution of all Company assets, the Company’s affairs shall terminate and the Managers shall cause to be filed with the Secretary of State of the State of Massachusetts a certificate of cancellation in accordance with the Act, as well as any and all other documents required to effectuate the termination of the Company.

ARTICLE X.

MISCELLANEOUS

10.1 Notices.

  1. Any and all notices, consents, offers, elections and other communications required or permitted under this Agreement shall be deemed adequately given only if in writing and the same shall be delivered either in hand or by mail or Federal Express or similar expedited commercial carrier, addressed to the recipient of the notice, postage prepaid and registered or certified with return receipt requested (if by mail), or with all freight charges prepaid (if by Federal Express or similar carrier) and with proof of delivery. The foregoing notwithstanding, notices may also be made by Electronic Transmission to a Member or Manager if acknowledged by such Member or Manager, which acknowledgement may be by Electronic Transmission.
  1. All notices, demands, and requests to be sent hereunder shall be deemed to have been given for all purposes of this Agreement upon the date of receipt or refusal.

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  1. All such notices, demands and requests shall be addressed as to the Members and the Managers, as the case may be, at the address set forth for each on Exhibit A or to such other address as any such Person may have designated for itself by written notice to the others in the manner herein prescribed, except that notices of change of address shall be effective only upon receipt.

10.2 Word Meanings. The words such as “herein”, “hereinafter”, “hereof” and “hereunder” refer to this Agreement as a whole and not merely to a subdivision in which such words appear unless the context otherwise requires. The singular shall include the plural and the masculine gender shall include the feminine and neuter, and vice versa, unless the context otherwise requires.

10.3 Binding Provisions. The covenants and agreements contained herein shall be binding upon, and inure to the benefit of, the heirs, legal representatives, successors and assigns of the respective parties hereto.

10.4 Title to Company Property. All property owned by the Company, whether real or personal, tangible or intangible, shall be deemed to be owned by the Company as an entity, and no Member, individually, shall have any ownership of such property. The Company may hold any of its assets in its own name or in the name of its nominee, which nominee may be one or more individuals, companies, trusts or other entities.

10.5 Applicable Law; Jurisdiction. This Agreement shall be construed and enforced in accordance with the laws of the State of Massachusetts. In the event of a conflict between any provision of this Agreement and any non-mandatory provision of the Act, the provision of this Agreement shall control and take precedence. All parties to this Agreement hereby consent to the jurisdiction of the Federal and state courts located in the Commonwealth of Massachusetts to resolve a dispute not subject to Section 10.6 (if any), and/or to enforce any award issued pursuant to an arbitration proceeding as described in Section 10.6.

10.6 Dispute Resolution.

  1. Non-binding Mediation. Prior to commencing any arbitration relating to this Agreement or otherwise relating to the Company (except for an action to enforce the provisions of confidentiality), a Member or Manager shall first give notice to the other Persons involved in the dispute and the parties shall follow the procedures outlined below:
  1. A meeting shall be held promptly between the parties, attended by individuals with decision-making authority regarding the dispute, to attempt in good faith to negotiate a resolution of the dispute.
  1. If within fifteen (15) days after the date of the notice referred to above, the parties have not succeeded in negotiating a resolution of the dispute, they agree to submit the dispute to nonbinding mediation in accordance with the Commercial Arbitration Rules and mediation Procedures of the American

Arbitration Association (the “AAA Rules”) and to bear equally the costs of the mediation.

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  1. The parties will promptly appoint a mutually acceptable mediator from a list of approved mediators from the American Arbitration Association if they have been unable to agree upon such appointment within ten (10) days from the end of the negotiation period.
  1. The parties agree to participate in good faith in the mediation and negotiation related thereto for a period not to exceed thirty (30) days. If the parties are not successful in resolving the dispute through the mediation, then any party may initiate arbitration upon seven (7) days prior written notice to the other parties.

10.7 Arbitration. In the event of any controversy between the parties arising under this Agreement that is not settled by mediation pursuant to Section 10.6(a), such controversy shall be determined by binding arbitration. Arbitration shall be conducted by three independent arbitrators who are experienced in the matter in dispute, one selected by each party, and the third by the arbitrators selected by the parties. Arbitration shall be conducted in accordance with the

  1. Rules and the American Arbitration Association shall administer the arbitration. Any party desiring to arbitrate a controversy shall give written notice to the other party, which notice shall include a designation of the name and address of the person to serve as arbitrator for the party giving such notice. Within fifteen (15) days after receipt of such notice, the recipient of such notice shall give written notice to the other party designating the name and address of a person to serve as arbitrator for the recipient of such notice. The two persons so designated shall forthwith select a third person and such three persons shall serve as arbitrators hereunder. In the event either party fails to designate a person to serve as arbitrator and give notice thereof to the other party as provided herein; or in the event the two persons so designated as arbitrators fail or refuse to select a third arbitrator; or in the event any arbitrator appointed fails or refuses to perform such arbitrator’s duties hereunder; either party may petition the American Arbitration Association for the appointment of an arbitrator. The parties shall pay the fees and expenses of the person designated by such party to serve as arbitrator (or, as the case may be, appointed for such party) and one-half of the fees and expenses of the third arbitrator; provided that the arbitrators shall have the power to award reimbursement to either party for such fees and expenses. Unless otherwise agreed to by the parties to the arbitration, all arbitration proceedings shall be held

within the City of Massachusetts. Judgment on the award rendered by the arbitrators may be entered by any Court designated in Section 10.5.

10.8 Severability of Provisions. Each provision of this Agreement shall be considered separable and if for any reason any provision or provisions herein are determined to be invalid, unenforceable or illegal under any existing or future law, such invalidity, unenforceability or illegality shall not impair the operation of or affect those portions of this Agreement which are valid, enforceable and legal.

10.9 Section Titles. Section titles are for descriptive purposes only and shall not control or alter the meaning of this Agreement as set forth in the text.

10.10 Further Assurances. The Members and Managers shall execute and deliver such further instruments and do such further acts and things as may be required to carry out the intent and purposes of this Agreement. Without limiting the foregoing, any Member that is resident in

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a community property jurisdiction shall, upon the request of a Manager, obtain the signature of such Member’s spouse consenting to the terms of this Agreement and waiving any and all special rights that might otherwise accrue to such spouse under any applicable community property law.

10.11 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original of this Agreement, but all of which together shall constitute one and the same instrument. Any signatures transmitted in a pdf file over the internet or by facsimile shall be deemed to be original signatures for all purposes.

10.12 Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto with respect to the transactions contemplated herein, and supersedes all prior understandings or agreements between the parties.

10.13 Amendments. This Agreement shall not be amended without a written instrument adopted by the Managers and executed and agreed to by of a Majority Interest; provided, however, that no amendment to this Agreement which at the time of such amendment would be reasonably likely to materially and adversely affect the rights or interests of a Member under this Agreement shall be made without the consent of such Member; provided, further, however, that such limitation shall not apply to an amendment which is required by law or required or permitted pursuant to the provisions of this Agreement, including without limitation, by the Managers to reflect the change of name and location of the principal office of the Company, the mailing address of the Company, the name and address of the registered agent of the Company, the transfer or acquisition of any interest by a Member in any manner permitted by this Agreement, a person becoming a substituted or an additional Member or Manager of the Company as permitted by this Agreement, a duly adopted amendment to this Agreement or any other change in any provision of this Agreement effected by the exercise by any person of any right or rights granted hereunder.

ARTICLE XI.

MANAGEMENT

11.1 Managers. The Company shall be managed by managers also known as the operational managers.

11.1.1 Management Delegated to CEO. The Member hereby delegates all management and decision-making authority of the Company to the CEO concerning the business affairs of the Company not exceeding $100,000.00.

11.1.2 Management Delegated to Managers. The Member hereby delegates all management of the Company to the Managers which shall consist of such number as may be set from time to time by the Member. All decisions concerning the business affairs of the Company exceeding $100,000.00 and less than $1,000,000.00 shall be made by the Managers.

11.2 Board of Directors. The Company shall have a board of directors constituting managers to be known as the “Board of Directors”.

11.2.1 Management Delegated to Board of Directors. The Member hereby delegates all management of the Company exceeding $1,000,000.00 to the Board of Directors which shall consist of such number as may be set from time to time by the Member. 

11.2.2 Constitution and Election of Directors. Members of the Board of Directors shall be appointed by the majority vote of the Members and shall serve at the pleasure of the Members. Directors may be removed at any time by the Majority Vote of the Members, with or without cause.

11.2.3 Meetings. The Board by resolution may provide for an annual meeting or other regularly scheduled meetings, which may be held without notice as and when scheduled in such resolution. Special meetings of the Board may be called at any time by the Member, the Chairman of the Board, the President, or by any two (2) or more directors. The Board of Directors, or any committee designated by the Board of Directors, may participate in a meeting of such Board or committee by means of conference telephone or similar communications equipment in which all persons participating in the meeting can hear each other, and participation in such a meeting pursuant to this Section 11.2.3 shall constitute presence in person at such meeting.

11.2.4. Notice and waiver; quorum. Notice of any special meeting of the Board of Directors shall be given to each director personally or by mail, telegram, or cablegram addressed to such director at such director’s last known address, at least two (2) days prior to the meeting. Such notice may be waived, either before or after the meeting. The attendance of a director at any special meeting shall of itself constitute a waiver of notice of such meeting and of any and all objections to the place or time of the meeting, or to the manner in which it has been called or convened, except where a director states, at the beginning of the meeting, any such objection or objections to the transaction of business. A majority of the Board of Directors shall constitute a quorum at any directors’ meeting.

11.2.5 No meeting necessary, when. Any action required by law or permitted to be taken at any meeting of the Board of Directors may be taken without a meeting if written consent, setting forth the action so taken, shall be signed by all the directors. Such consent shall have the same force and effect as a unanimous vote of the Board of Directors and shall be filed with the Secretary and recorded in the Minute Book of the Company.

11.2.6 Voting. At all meetings of the Managers and the Board of Directors, each manager/director shall have one vote and, except as otherwise provided herein or provided by law, all questions shall be determined by a majority vote of the directors’ present. In the event of a split vote by the Managers, the Manager having supervisory authority over the department to be affected by the decision shall decide the split vote, provided that the CEO reserves the right to veto the decision. In the event of a split vote by the Board of Directors, the Chairman shall decide the split vote.

ARTICLE XII

DISTRIBUTION AND DISPOSITIONS OF SHARES.

12.1 Restrictions on Transfer of Shares.  No Member shall have the right to Transfer any Share without the Managers approval and complying in all respects with the Restriction Agreement.  Any permitted Transfer by a Member shall become effective on the first day of the calendar month immediately succeeding the month in which the Company has received a transfer fee sufficient to cover all expenses of the Company connected with such transfer; provided, however, that the Managers may elect to waive this fee in their sole discretion.  All distributions prior to the effective date shall be made to the transferor, and all distributions made thereafter shall be made to the transferee. No share held for less than one year shall be transferable.

12.1 First Right of Refusal. No Member shall have the right to Transfer any Share without first providing the company with a 60-day notice upon which the company shall have the first right to acquire the shares intended for transfer. Failure to issue the 60-day notice shall render any share transfer null and void.

12.1 Charging of Shares.  No Member shall have the right to secure and/or satisfy any personal debt using the company Shares for any reason. Any member that attempts to secure or payoff a personal debt using the company shares, shall immediately forfeit all the Member’s shares to the company.

12.1 Forfeiture of Shares.  Any Member who voluntarily files for bankruptcy proceedings, or is a party against whom bankruptcy proceedings have been filed, shall immediately upon such filing of such proceedings forfeit all shares held by that Member to the Company 

12.1 Matrimonial Property. Shares issued by the Company to the Members shall not constitute part and parcel of any matrimonial property of the member. Any shares transferred by virtue of a court order in a marital separation/dissolution proceeding, shall vest to the receiving party under the name and guise of the original member. Any shares transferred by virtue of a court order in a marital separation/dissolution proceeding shall bear no voting rights without the written consent and approval of the Company.

12.1 Succession. In the event of Members death, disability, or incapacity, the shares held by such a Member shall cease to bear any voting rights pending the written approval of the Company to appointed beneficiary of the Member. The appointed beneficiary of the Member shall full authority to transfer the shares back to the company at a price equivalent to the current market valuation of each share.

[Remainder of page intentionally blank. Signature page follows.]

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IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the day and year first above written.

Managers:

Ricardo Correia

Tyrone Gomes

Keith Boyd

Jessica Landress

Members:

o Rocardo Correia

o Tyrone Gomes

o Keith Boyd

o Jessica Landress

o Zachary Labonte

[Member Signature Page follows]

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Lab X (LabX Group LLC)

Limited Liability Company Agreement dated November 23, 2021

MEMBER SIGNATURE PAGE

The undersigned, hereby a Member of Lab X (LabX Group LLC), a commonwealth of Massachusetts limited liability company (the “Company”), and a party to the Limited Liability Company Agreement of the Company.

Tyrone Gomes

Name of Manager / Member (please print)

Keith Boyd

Name of Manager / Member (please print)

Signature of Member or Authorized Person

Keith Boyd (Dec 1, 2021 20:08 EST)

Signature of Member or Authorized Person

Date: November 23, 2021

Date:

Dec 1, 2021

Jessica Landress

Name of Manager / Member (please print)

Jessica Landress, Esq.

Jessica Landress, Esq. (Dec 1, 2021 20:01 EST)

Signature of Member or Authorized Person

Date: Dec 1, 2021

Zachary Labonte

Name of Member (please print)

Zachary Labonte

Zachary Labonte (Dec 2, 2021 06:55 EST)

Signature of Member or Authorized Person

Date: Dec 2, 2021

Ricardo Correia ceo

Name of Authorized Manager / Member (please print)

Signature of Authorized Manager

Date: Dec 2, 2021

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EXHIBIT A

LabX Group LLC, a Massachusetts limited liability

company Member and Manager information

as of November 23, 2021

  Member Name and Address Class A Class B Approx. Approx.  
    Shares Shares Voting Percentage  
    (voting) (non-voting) Interest Interest  
             
1. Ricardo Correia – CEO 27,000 -0- 27% 27%  
             
2. Tyrone Gomes – CSO 27,000 -0- 27% 27%  
             
11. Keith Boyd – COO 11,000 -0- 11% 11%  
             
4. Jessica Landress – CMO 5,000 0 5% 5%  
             
5. Zachary Labonte 1,176 0 1.176% 1.176%  
             
6. LabX Group llc (unissued shares) 28,824 -0- 28.824% 28.824%  
             
             
             
             
             
             
  Total 100,000 0 100% 100%  
     
             

Managers: Ricardo Correia, Tyrone Gomes, Keith Boyd, Jessica Landress,

Members: Ricardo Correia, Tyrone Gomes, Keith Boyd, Jessica Landress, Zachary Labonte

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