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PZ - Esperanza Operating Agreement Executed OPERATING AGREEMENT of 30352 ESPERANZA, LLC This Operating Agreement(the"Agreement"),which shall be effective as of May 12, 2016, is entered into by and between 30352 Esperanza, LLC, a California limited liability company("30352" and/or the "Company") on the one hand, and Cesar Meyer and Brock Ward (collectively, the "Members," or individually, a"Member")on the other hand, each of whom desires to enter into this Agreement in accordance with the California Revised Uniform Limited Liability Company Act (California Corporations Code §17701.01, et seq.) (the "Act"). The Members and the Company maybe collectively referred to in this Agreement as the "Parties," or individually as a"Party." NOW, THEREFORE, the Members agree as follows: 1. SELECTED DEFINITIONS 1.1. Selected Definitions. A variety of words and phrases will be capitalized in this Agreement. Many will be defined in this "Selected Definitions" section,while others will be defined elsewhere in this Agreement. 1.2. Adiusted Taxable Income. As used in this Agreement,"Adjusted Taxable Income" means the federal taxable income allocated by 30352 to the Members with respect to their Membership Interests for such whole or partial fiscal year. Such taxable income shall be computed by: (i) subtracting excess taxable losses or credits of the Company for any prior period allocable to each of the Members pursuant to their respective Membership Interests, and as long as such losses/credits were not previously taken into account for purposes of determining such Member's Adjusted Taxable Income in a prior fiscal year to the extent such loss or credit would be available under the Code to offset income of the Member determined as if the income, loss, and credits from the Company were the only income, loss, and credits of the Member in such or any prior fiscal years; and (ii) taking into account any special basis adjustment with respect to such Member resulting from an election by the Company under §754 of the Code. 1.3. Affected Member. As used in this Agreement, "Affected Member"means, as the context will dictate, a Member whose conduct, actions, or circumstances caused a Dissolution Event, caused a voluntary withdrawal which does not constitute a Dissolution Event, or who is otherwise the subject of some action affecting the Company or the other Member. 1.4. Affiliate. As used in this Agreement, "Affiliate"means any Person who is in control of, under the control of, or in common control with, a Member or Officer,whether such control is direct or indirect. [In context of an Affiliate, "control" (including the terms "controlling, " "controlled by"and "under common control with') means, with respect to a corporation or limited liability company, the power to exercise more than fiftypercent (50%) of the voting rights of that corporation or limited liability company, and with respect to an individual,partnership, trust, or other entity or association, the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract, or otherwise.] 1.5. Affiliate Agreement. As used in this Agreement, "Affiliate Agreement"means any agreement,whether written or oral,between 30352 and any Member or Officer of the Company (including their respective Affiliates, if any). Such Affiliate Agreements might relate to any Operating Agreement 30352 ESPERANZA,LLC Page 1 of 29 matter(e.g., employment, loans to or from 30352, business conducted between the Company and an Affiliate, etc.). 1.6. Articles. As used in this Agreement, "Articles"means the Articles of Organization filed with the California Secretary of State forming the Company, as initially filed and as they may be amended from time to time. 1.7. Bankruptcy. As used in this Agreement, "Bankruptcy"means: (i)the filing of an application by a Member for, or its/his consent to, the appointment of a trustee, receiver, or custodian of the Member's assets; (ii)the entry of an order for relief with respect to a Member in proceedings under the United States Bankruptcy Code, as amended or superseded from time to time; (iii) the making by a Member of a general assignment for the benefit of creditors; (iv)the entry of an order,judgment, or decree by any court of competent jurisdiction appointing a trustee, receiver, or custodian of the assets of a Member(unless the proceedings and the person appointed are dismissed within ninety(90) days); or(v)the failure by a Member generally to pay the Member's debts as the debts become due within the meaning of§303(h)(1) of the United States Bankruptcy Code, as determined by the Bankruptcy Court, or the admission in writing of the Member of the Member's inability to pay its/his debts as they become due. 1.8. Capital Account. As used in this Agreement, "Capital Account" initially means the value of a Member's capital investment in the Company,whether in the form of money, personal or real property, and/or labor and services performed, and thus generally represents a Member's equity in the Company. A Member's Capital Account may be adjusted from time to time to reflect not only all the Member's Capital Contributions to the Company,but also the Company's allocations of Net Profits,Net Losses, and/or Distributions to the Member. 1.9. Capital Contribution. As used in this Agreement, "Capital Contribution(s)"means any Member's contribution to the capital of the Company in the form of cash,property, services rendered, or a promissory note (or other binding obligation to contribute cash or property or to render services). The amount of any non-cash contribution shall constitute the fair market value of such contribution (net of liabilities secured by such contributed property that the Company is considered to assume or take subject to Code §752). Capital Contributions shall not be deemed loans. 1.10. Capital Event(s). As used in this Agreement, "Capital Event(s)"means the sale or other disposition of any of 30352's capital assets, or alternatively the receipt of money paid by an insurance company for the loss of Company property, or the receipt of proceeds arising out of a refinancing of any of the Company's property. 1.11. Code. As used in this Agreement, and unless specifically stated otherwise, "Code' means the Internal Revenue Code, as amended from time to time, or any corresponding provision of any succeeding revenue law. 1.12. Company Minimum Gain. As used in this Agreement, "Company Minimum Gain" shall have the same meaning as set forth for the term "Partnership Minimum Gain" in Treasury Regulations §1.704-2 (26 C.F.R. §1.704-2). Operating Agreement 30352 ESPERANZA,LLC Page 2 of 29 1.13. Confidential Information. As used in this Agreement, "Confidential Information" shall mean all of the Company's proprietary or confidential information, in whatever form(oral, visual, written, electronic, tangible, or intangible),whether labeled"confidential" or otherwise, and including, without limitation, information related to the Company's: (i) clients or customers; (ii) technical data; (iii)know-how; (iv) non-public information reasonably considered proprietary or confidential; (v)profitable markets, lines of distribution, and/or marketing plans, strategies and resources; (vi)pricing and pricing models; (vii)non-public software,programs, algorithms, and/or source code; (viii) developments, inventions, processes, and formulas; (ix)proprietary technology and designs; (x) financial data; (xi)business operations, including expansion strategies and plans; (xii) inventory; and(xiii) any other information deemed"confidential" within the meaning of California Civil Code §3426, et seq. 1.14. Corporations Code. As used in this Agreement, "Corporations Code"means the California Corporations Code, as amended from time to time, and the provisions of any succeeding law. 1.-15. Departing Member. As used in this Agreement, "Departing Member"means any Member(or when applicable, a Member's trustees, executors,heirs,beneficiaries, or representatives) whose conduct or circumstances results in a Dissolution Event, or who otherwise withdraws, in whole or in part, from the Company in accordance with the terms set forth below, where such withdrawal does not result in a Dissolution Event. When the context so dictates, "Departing Member" shall also include the Departing Member's Estate Representatives regardless of whether or not words to that effect are included in a specific provision set forth below. 1.16. Dissolution Event. As used in this Agreement, "Dissolution Event"means,with respect to a Member(i.e., an Affected Member), any of the following: death, serving notice of intent to withdraw as a Member(unless related to the voluntary Transfer of a Member's Membership Interest to a non-Member third-party), retirement, insanity, incapacity, or Bankruptcy. With respect to a Member's insanity or incapacity, such events would only constitute Dissolution Events if the condition(s) lasted for one hundred and twenty(120) days or more (in the aggregate) during any consecutive twelve (12)month period. 1.17. Distribution(s). As used in this Agreement, "Distribution(s)"means the transfer of money or property by the Company to the Members and/or Transferee(s), whichever the case may be. 1.18. Economic Interest. As used in this Agreement, "Economic Interest"means the right, as originally associated with a Member, to receive Distributions from the Company, as well as to view the information available to those with a transferable interest within the meaning of Corporations Code §17704.10. A mere Economic Interest does not convey any other rights to any Person,including the right to vote or be deemed a Member of the Company. Persons holding an Economic Interest in the Company shall not have the ability to Transfer that interest, nor shall such Persons have any obligations to make Capital Contributions. Operating Agreement 30352 ESPERANZA,LLC Page 3 of 29 1.19. Electronic Transmission. As used in this Agreement, "Electronic Transmission," whether by or to the Company, shall have the same meaning as is set forth in Corporations Code §17701.02(i)(1)-(2). 1.20. Estate Representative(s). As used in this Agreement, "Estate Representative(s)"means a deceased or Incapacitated Member's applicable heirs,beneficiaries, representatives,trustees, executors, guardians, conservators, etc. Therefore, when the context so dictates, the terms "Estate Representative(s)," "Departing Member" and"Affected Member" shall be interchangeable. 1.21. Fiscal Year(s). As used in this Agreement, "Fiscal Year(s)"means the Company's fiscal year,which shall be the calendar year. In the event that 30352 makes a tax election which permits it to have a different Fiscal Year(upon a vote of both Members), or the Company is otherwise required to alter its Fiscal Year, the Company's Fiscal Year shall be altered accordingly. 1.22. Incapacity. As used in this Agreement, "Incapacity"means either a declaration by a court of competent jurisdiction that the Affected Member is mentally incapacitated, or the inability of a Member, as a result of physical illness or mental impairment, to reasonably and intelligently participate in the day-to-day management and operation of 30352. Notwithstanding the foregoing, a Member shall only be deemed Incapacitated under this Agreement(triggering a Dissolution Event) if the condition lasts for one hundred and twenty(120) days or more (in the aggregate) during any consecutive twelve (12)month period. 1.23. Member. As used in this Agreement, "Member"means each individual who: (i)has been admitted into membership in the Company pursuant to the terms of this Agreement, and as reflected in the attached Exhibit "A"; (ii) has signed this Agreement(and any subsequent amendments to it); and(iii)has not engaged in conduct resulting in a Dissolution Event or whose membership has not already been terminated for any other reason. 1.24. Member Nonrecourse Debt. As used in this Agreement, "Member Nonrecourse Debt" shall have the same meaning as set forth for the term "Partner Nonrecourse Debt" in Regulations §1.704-2(b)(4). [26 C.F.R. §1.704-2(b)(4).] 1.25. Member Nonrecourse Deductions. As used in this Agreement, "Member Nonrecourse Deductions"means items of Company loss, deduction, or Code §705(a)(2)(B) [26 U.S.C.A. §705(a)(2)(B)] expenditures which are attributable to Member Nonrecourse Debt. 1.26. Membership Interest. As used in this Agreement, "Membership Interest,"which,when expressed as a percentage of ownership in the Company, may also be referred to as a "Percentage Interest,"means the totality of a Member's rights in the Company, including: (i) an Economic Interest, as well as the right to share in the Company's losses and deductions; (ii) a management interest(i.e., the right to vote and make decisions concerning the Company's business affairs and day-to-day operations; and(iii) an informational interest(i.e., the right to information and documents concerning the business and affairs of the Company). The Membership Interest of each Member of 30352 is set forth in Exhibit "A." Should there come a time when an individual is entitled to a certain percentage of the revenue of the Company,but Operating Agreement 30352 ESPERANZA,LLC Page 4 of 29 does not otherwise have any other rights (i.e., has only an Economic Interest),Exhibit "A"shall be amended to reflect this individual's rights. 1.27. Negative Capital Account/Positive Capital Account. As used in this Agreement, the terms "Negative Capital Account" and"Positive Capital Account" shall mean a Capital account with a balance of less than zero, and a Capital account with a balance greater than zero, respectively. 1.28. Net Profits & Net Losses. As used in this Agreement, and pursuant to applicable law, including without limitation, Code §§703 and 705, the terms "Net Profits" and"Net Losses" mean the income, gain, loss, deductions, and credits of the Company in the aggregate or , separately stated, as appropriate, determined in accordance with generally accepted accounting principles employed under the method of accounting at the close of each Fiscal Year on the Company's information tax return filed for federal income tax purposes. 1.29. Percentage Interest. As used in this Agreement, "Percentage Interest"means the Membership Interest of each Member expressed as a percentage of ownership of the Company out of a total of 100%. The Percentage Interest of each Member is set forth in Exhibit "A." 1.30. Person. As used in this Agreement, "Person"means an individual,partnership, limited partnership, corporation, limited liability company, registered limited liability partnership, trust, trustee of a trust, estate, association, or any other entity. 1.31. Regulations. As used in this Agreement, "Regulations"refers to the income tax regulations of the United States Treasury Department promulgated under the Code, including any temporary regulations, and any successor regulations which may be promulgated. 1.32. Remaining Member. As used in this Agreement, "Remaining Member"means,upon the occurrence of a Dissolution Event, or a withdrawal from the Company of a Member where such withdrawal does not constitute a Dissolution Event, the Member of the Company whose conduct or circumstances did not cause the Dissolution Event or withdrawal. The term "Remaining Member" shall, when context dictates, have the same meaning as "non-Affected Member." 1.33. Securities Act. As used in this Agreement, "Securities Act"means the Securities Act of 1933, as amended, as well as any rules or regulations promulgated pursuant to the Securities Act. "Securities Act" shall also mean any federal act passed as a successor to the Securities Act. 1.34. Tax Matters Member. As used in this Agreement, "Tax Matters Member" shall have the same meaning as the term"Tax Matters Partner,"which is defined in §6231(a)(7) of the Code. 1.35. Transfer(s). As used in this Agreement, "Transfer(s)" shall mean any voluntary or involuntary, and direct or indirect, sale, Transfer, conveyance, assignment, pledge, or encumbrance of any or all of a Member's Percentage Interest in 30352 to a non.-Member third- party, regardless of whether such a Transfer occurred by operation of law (e.g.,bankruptcy, court Operating Agreement 30352 ESPERANZA,LLC Page 5 of 29 order, foreclosure of a security interest, creditor's,execution on a judgment, appointment of a receiver, assignment for the benefit of creditors, etc.), or otherwise. 1.36. Transferee(s). As used in this Agreement,"Transferee(s)" shall mean any individual who receives a Transfer of all or part of a Member's Membership Interest in the Company, regardless of whether or not the Transferee ultimately will become a Member and have the rights granted to Members (e.g.,the right to vote), or who may otherwise acquire nothing but all or part of a Member's Economic Interest in the Company. This definition shall apply whether such acquisition was voluntary(i.e., assignment, sale, pledge, or encumbrance), or involuntary(i.e., bankruptcy, court order, foreclosure of security interest,judgment creditor, etc.). 2. FORMATION AND ORGANIZATION 2.1. Name & Articles. The name of the Company is 30352 Esperanza, LLC, and it was formed upon the filing of its Articles of Organization with the California Secretary of State on May 9, 2016. Subject to the provisions of this Agreement set forth below, no Person may become a Member of 30352 Esperanza, LLC without agreeing to and becoming a signatory to this, or an amended version of this, Agreement. 2.2. Operating Agreement. This Agreement has been entered into by the Members for the express purpose of setting forth their rights, duties, and obligations to each other and to 30352. To the extent that a provision in this Agreement alters one or more default provisions of the Act, such alteration was intentional. 2.3. Term. 30352 shall continue in existence in perpetuity, unless dissolved earlier under a specific provision set forth in the Articles, as required by the Act, or such earlier time as determined in accordance with the provisions of this Agreement. 2.4. California Address. The Company's designated office in the State of California shall be 30352 Esperanza, Rancho Santa Margarita, CA 92688, or at any other address within the State of California upon which both Members may agree. The Company shall maintain at this address, or at the office of the Company's attorneys, all the records and documents which the Company is required to keep pursuant to Corporations Code §17701.13. 2.5. Agent for Service of Process. 30352's agent for service of process shall be the agent named in the Company's Articles of Organization. Subject to the requirements of the Act, and upon the consent of both Members, the Company may select a new agent for service of process at any time. 2.6. Names and Addresses of Members. The names and mailing addresses of the Members, along with their respective Membership Interests in the Company, are set forth in the attached Exhibit "A." 2.7. Authorization and Purpose. Pursuant to the Act, the Members have formed this Company for the purpose of engaging in any lawful business activity in which limited liability companies are permitted to engage under California law. The Members intend to govern the Company in accordance with the Act, the Articles, and this Agreement, and consequently the Operating Agreement 30352 ESPERANZA,LLC Page 6 of 29 Members shall have the power and authority granted to them under California law to carry out the business of the Company. In the event of any conflict between the Act and this Agreement, this Agreement shall control to the maximum extent permitted by applicable law. Likewise, in the event of any conflict between the Articles and this Agreement, this Agreement shall control as to current or prior Members or Transferees. 3. CAPITAL CONTRIBUTIONS AND ACCOUNTS 3.1. Initial Capital Contributions. The Members' initial Capital Contributions to 30352 are set forth in Exhibit "A." 3.2. Additional Contributions. Neither Member shall be required to make any additional contributions to the Company. However,upon the consent of both Members that additional capital is desirable or necessary to cover reasonable business related expenses, the Members shall make such additional contributions. Exhibit "A"shall be revised from time to time to reflect such changes in each of the Members' Percentage Interests. 3.3. Capital Accounts. The Company shall create and maintain a Capital Account for each Member of 30352 inconformity with Regulations §1.704-1(b)(2)(iv) [26 C.F.R. §1.704- 1(b)(2)(iv)]. Should any Member Transfer all or any part of his Membership Interest in accordance with this Agreement, the Transferee shall receive that portion of the Member's Capital Account attributable to the interest transferred. Subject to the Regulations,the Members may choose to revise the manner in which the Company manages and/or computes the Members' Capital Accounts. 3.3.1. Increases to a Member's Capital Account. A Member's Capital Account may be adjusted upwards (i.e., increased) if a Member contributes additional cash or property (real or personal) to 30352, if a Member assumes any of the Company's (or another Member's) debt (whether secured or unsecured), or if a Member receives distributions of Net Profits from the Company within the meaning of Internal Revenue Code §705(a)(1)(B). 3.3.2. Decreases to a Member's Capital Account. Likewise, a Member's Capital Account may be adjusted downwards (i.e., decreased) if a Member receives cash or property(real or personal) from 30352, if the Company(or another Member) assumes any of a Member's debt(whether secured or unsecured), or if a Member shares in the Company's Net Losses within the meaning of Code §§705 and 752. 3.4. No Withdrawals From Capital Accounts/No Interest. No Member shall be entitled to any withdrawal from their Capital Account or receive any Distributions from the Company except as is otherwise stated in this Agreement. Likewise, no Member will receive interest in connection with any Capital Contributions provided to the Company. 3.5. Right of Return of Contributions. Except as expressly set forth in this Agreement, and excluding cash,upon the dissolution of the Company, the Members shall not be entitled to a return of any Capital Contributions made to the Company. Likewise,unless expressly provided Operating Agreement 30352 ESPERANZA,LLC Page 7 of 29 in this Agreement, no Member shall have priority over any other Member regarding the return of their Capital Contribution. 4. MEMBERS 4.1. Membership Certificates. The Members shall issue membership certificates representing their respective Membership Interests in the Company, and each such certificate shall contain the following legend: PLEASE TAKE NOTICE THAT THIS LLC MEMBERSHIP CERTIFICATE REPRESENTS THIS MEMBER'S MEMBERSHIP INTEREST IN THE LLC IDENTIFIED ON THE CERTIFICATE. THE TRANSFERABILITY OF THE MEMBERSHIP INTEREST REPRESENTED BY THIS CERTIFICATE IS STRICTLY CONDITIONED UPON THE REQUIREMENTS AND RESTRICTIONS CONTAINED IN THE OPERATING AGREEMENT ENTERED INTO BY AND AMONG THE LLC'S MEMBERS. NO TRANSFER, SALE, ASSIGNMENT, OR PLEDGE OF THE MEMBERSHIP INTEREST REPRESENTED BY THIS CERTIFICATE SHALL BE MADE UNLESS IT IS MADE IN COMPLIANCE WITH THE REQUIREMENTS AND RESTRICTIONS CONTAINED IN THE OPERATING AGREEMENT. PLEASE TAKE FURTHER NOTICE THAT THE MEMBERSHIP INTEREST REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY OTHER APPLICABLE SECURITIES LAWS. CONSEQUENTLY, THE MEMBERSHIP INTEREST MAY NOT BE TRANSFERRED, SOLD, ASSIGNED, OR PLEDGED UNLESS PURSUANT TO A REGISTRATION STATEMENT EFFECTIVE UNDER APPLICABLE LAW, OR ANY APPLICABLE EXEMPTIONS. 4.2. Limitation of Liability. Unless otherwise set forth elsewhere in this Agreement and subject to applicable law, no Member shall be personally liable for any of the Company's debts, obligations, liabilities, or judgments solely because of the Member's membership in 30352. 4.3. Member Votes. Unless otherwise specifically stated below, both Members shall be entitled to vote regarding issues related to the organization, operation, and dissolution of 30352 solely in proportion to their Membership Interests in the Company, and all votes shall be counted pursuant to the Members' Membership Interests in the Company. It is the intention of the Parties to this Agreement that unless otherwise specifically stated elsewhere in this Agreement, the number of Members who vote on a particular issue shall be irrelevant. Rather, for purposes of establishing a quorum or taking action requiring a vote of the Members, unless otherwise stated in this Agreement, the Percentage Interests involved shall constitute the appropriate means of determining the results of a vote. 4.4. Additional Members. Subject to the terms set forth below and to the Act, new Members may be admitted to 30352: (i)upon the consent of both Members; or(ii) otherwise as a result of an approved Transfer(in the manner set forth below in the Transfer and Termination section of this Agreement) and subsequent decision by both Members to permit the Transferee to be a Member. At the same time, the existing Members shall, upon their unanimous consent, . Operating Agreement 30352 ESPERANZA,LLC Page 8 of 29 determine the extent, if any, of the new Member's right to participate in the day-to-day management of the Company and/or vote on issues relevant to the Company. In no event shall a Transferee become a Member of 30352, even if the other Members vote to make such an individual a Member, until the Transferee fulfills the applicable requirements of this Agreement, including without limitation, signing an amended and restated version of this Agreement, as well as.any other documents upon which membership in 30352 is conditioned. Exhibit"A"shall be amended to reflect the addition of a new Member. 4.4.1. Amended Articles of Organization. In the event that the Members determine that the new Member shall not be a managing-Member of 30352, the Members will prepare and file with the California Secretary of State the required documentation, including without limitation, an Amended Articles of Organization converting 30352 from a member-managed limited liability company to a manager-managed limited liability company. 4.5. Withdrawal from Membership. Subject to Corporations Code §§17706.01 and 17706.02, a Member may withdraw as a Member of 30352 at any time after giving written notice to the Remaining Member at least ninety(90) days prior to the effective date of the withdrawal. The Departing Member may revoke his notice to withdraw in writing at any time prior to the expiration of the ninety(90) days by delivering such revocation to the Remaining Member. Once the Departing Member provides his notice of intent to withdraw (and does not revoke such notice prior to the required time period),the Departing Member shall, from that time forward, no longer have any voting rights. Rather, the Departing Member shall only have the Economic Interest of a Transferee. Once the ninety(90) days has passed, if the Departing Member did not revoke his withdrawal,the Departing Member shall no longer be deemed a Member of 30352, and he shall no longer have any rights in or to the Company. Subject to applicable law, the Departing Member's Membership Interest shall be valued and paid out pursuant to the Purchase Price provision contained in the Transfer and Termination section below. In addition to the foregoing, a Member shall withdraw if required by the Act. To the fullest extent permitted by the Act, a Member who withdraws from the Company shall remain liable both to the Company and to the other Member for the Company's debts, obligations, and liabilities. Exhibit "A"shall be revised to reflect a Member withdrawal from the Company. As is set forth elsewhere in this Agreement, the withdrawal of a Member(other than a withdrawal involving an approved Transfer to a non-Member third-party) shall constitute a Dissolution Event regardless of whether the withdrawal was authorized or not. 4.5.1. Conforming(Authorized)Withdrawal. A conforming, or authorized, withdrawal occurs when the Departing Member receives the requisite consent to withdraw pursuant to the terms of this Agreement and when there is substantial compliance with the conditions, restrictions, and limitations relating to withdrawals (and where applicable, Transfers) contained in this Agreement. Subject to the exception regarding Transfers to non-Member/non-Affiliate third-parties, in the event of a conforming and authorized withdrawal, the Remaining Member will decide whether or not to dissolve and wind up the Company's affairs. If the Remaining Member decide to - continue operating 30352, the Departing Member will,unless otherwise prohibited by applicable law, be paid for his Membership Interest pursuant to the Purchase Price Operating Agreement 30352 ESPERANZA,LLC Page 9 of 29 provision contained in the Transfer and Termination section below. All other withdrawals shall be deemed wrongful and non-conforming. 4.5.2. Non-Conforming Withdrawals (No Transfers). Any withdrawal required by the Act, as well as any unauthorized withdrawal, shall constitute a non-conforming or wrongful withdrawal and a material breach of this Agreement. In addition to being held liable to both 30352 and to the Remaining Member, the Departing Member who wrongfully withdraws from the Company shall no longer have all the rights of a Member, and instead shall, from that time forward, only have the Economic Interest of a Transferee. The Remaining Member shall then decide whether to continue operating the Company or not pursuant to the terms set forth in the Transfer and Termination section below. In the event that the Remaining Member elects to continue operating the Company, the Affected Member shall continue to hold only the rights of a Transferee. 4.5.3. Wrongful Withdrawal Involving a Purported Transfer. See the Wrongful Transfer section contained in the Transfer and Termination section below. 4.6. Competing Activities. To the fullest extent permitted under the Act, and subject to the Members' obligations to protect the Company's Confidential Information,the Members acknowledge and agree that each of them may freely participate and engage in investment interests and business activities other than those related to the Company, including those which directly compete with the business of 30352. This provision of the Agreement is specifically intended to permit the Members to enter into and engage in business transactions which are directly competitive with those of the Company, and neither the Company nor the other Member shall have any right to make claim(s) against the other Member regarding such competing activities merely as a result of his Membership Interest in 30352. 4.7. Compensation/Reimbursement of Members. Unless otherwise approved by both Members, no Member or Affiliate shall be entitled to compensation for services rendered to the Company unless such services relate to the formation or winding up/dissolution-of the Company. Either or both Members shall, however, be entitled to reimbursement for any reasonable costs they actually incur with respect to the formation, operation, growth, or dissolution of the Company. 4.8. Transactions with Company. Subject to any limitations set forth in the Act or elsewhere in this Agreement, the Members of 30352 may lend money to, or otherwise transact business with, the Company. Unless both Members elect otherwise, a loan to the Company by a Member shall not constitute a Capital Contribution. 4.9. Members Are Agents. The Members-each intend to actively participate in the management of 30352. Consequently,unless otherwise set forth in this Agreement, each Member is authorized to act as an agent for the Company if such actions are in compliance with the wishes and decisions of both Members. 4.10. Dedication of Time. The Members shall individually devote whatever time they reasonably believe is necessary to conduct the Company's business and affairs. Operating Agreement 30352 ESPERANZA,LLC Page 10 of 29 4.11. Meetings. Although there shall be no required regular or annual meetings of the Members, the Members nonetheless agree that Members' meetings which do occur shall be conducted in accordance with Corporations Code §17704.07 and/or as follows: 4.11.1. Calling of Meetings. Member meetings may be called by either of the Members. The Member who calls the meeting shall preside at that meeting, and shall select the other Member to act as secretary for the meeting. 4.11.2. Location and Time of Meetings. Meetings shall take place any day of the week between 8:00 am and 5:00 pm at the Company's principal office, or at any other location that the individual calling the meeting selects, as long as telephonic or electronic attendance by the other participants of the meeting is feasible. If both Members elect otherwise, such meetings may take place either before 8:00 am or after 5:00 pm. 4.11.3. Notice. Written notice of any meeting shall be provided to the other Member. Such notice shall be given by the individual who called the meeting, must specify the purpose(s) of the meeting, and shall otherwise be given in accordance with the applicable requirements of Corporations Code §1.7704.07. If a Member attends a meeting of the Members,he shall be deemed to have waived his right to object to the notice of the meeting unless he expresses such an objection at the commencement of the meeting. 4.11.4. Quorum. No action may be taken at any meeting unless both Members are present (in person or via proxy). Once a quorum has been established at a duly held meeting,business may be regularly transacted at that meeting. 4.11.5. Waiver of Notice or Consent. The actions taken at any meeting of Members however called and noticed and wherever held,have the same validity as if taken at a meeting duly held after regular call and notice, if a quorum is present either in person or by proxy, and if either before or after the meeting, each of the Members entitled to vote who was not present in person or by proxy, signs a written waiver of notice or consents to the holding of the meeting or approves the minutes of the meeting. All such waivers, consents or approvals shall be filed with the Company records or made a part of the minutes of the meeting. 4.11.6. Telephonic or Electronic Participation. Members may participate in any meeting of the Members via Electronic Transmission as long as both Members can hear one another, and as long as the use of such equipment otherwise complies with Corporations Code §17704.07(k) and (q). A Member so participating is deemed to be present in person at the meeting. 4.11.7. Voidability of Actions Taken. Any actions taken or any agreements reached by the Members which directly conflict with any of the provisions of this Agreement shall be void and unenforceable. 4.11.8. Proxies. Both Members may vote in person or via the use of proxies as set forth in Corporations Code §17704.07(o). Operating Agreement 30352 ESPERANZA,LLC Page 11 of 29 4.11.9. Voting Rights. Unless otherwise specifically set forth in this Agreement or mandated otherwise in the Act, all matters requiring the vote, approval, or consent of the Members may be authorized upon the vote, approval, or consent of both Members. 4.12. Liability for Acts and Omissions. As long as the Members abide by their fiduciary duties to the other Member(s) and the Company, no Member shall incur any personal liability to any other Member or 30352 for any actions taken(or for a failure to act) on the Company's behalf. 5. MANAGEMENT 5.1. Member-Managed. Unless otherwise expressly set forth in this Agreement, and subject to the provisions of the Act, 30352 shall be managed and controlled by the two (2)Members, each of whom shall have the authority to operate, control, act for, and bind the Company, as well as exercise all the powers described in Corporations Code §17701.05. Such powers include, without limitation,the right to: (i) endorse checks and other instruments made payable to the Company; (ii) sign contracts (e.g., leases, employment, etc.) and incur obligations (e.g., mortgages, loans, lines of credit, etc.) on the Company's behalf, (iii)pay invoices and other debts of the Company; (iv) sign checks, drafts, and other instruments obligating the Company to any other Persons; (v)hire and fire consultants, attorneys, accountants, employees, and independent contractors; (vi) initiate, defend, and settle lawsuits or administrative actions; (vii) purchase and maintain various types of insurance; (viii) loan money to Members or employees; (ix) invest profits; (x) indemnify Persons acting on the Company's behalf; (xi) establish employee benefits; (xii)make charitable donations that further the Company's business and affairs; (xiii) appoint officer(s); and (xiv) select the manner in which 30352 will be taxed(e.g., as a corporation or partnership); and(xv)take any other actions they deem necessary to manage the Company's affairs. 5.1.1. Appointment of Officers. From time to time,the Members may decide to appoint either one (1) or more non-Members and/or one (1) or more of themselves, to act as officer(s) of the Company(e.g., President, CFO, etc.) (the "Officer(s)"), each of whom shall serve at the pleasure of both Members. One (1)individual may serve in more than one(1) office. In the event a non-Member third-party is selected to act as an Officer of the Company, his/her compensation shall be decided by both Members of 30352. With respect to Member(s) serving as Officer(s) of the Company, such Member-Officer(s) shall not earn additional compensation for acting as Officers unless upon the consent of all the Members, which shall be reflected in a separate written agreement. A Member's affiliation with a specific office shall not grant that Member any additional power or authority over any other Member,but instead shall be viewed solely as a means of dividing labor and/or communication with third-parties. 5.2. Assets of the Company/Bank Accounts. The Members shall ensure that all of the Company's assets are at all times held in 30352's name and are never commingled with any personal assets. Likewise,the Members shall ensure that all of the Company's funds are deposited into and held in one (1) or more bank/financial accounts in the Company's name. Such accounts shall be with one (1) or more recognized financial institutions, and subject to.the limitations set forth elsewhere in this Agreement regarding the spending of the Company's Operating Agreement 30352 ESPERANZA,LLC Page 12 of 29 funds, each Member shall be an authorized signer on all such accounts. Upon the consent of both Members of 30352, non-Members may also be designated as signers on one (1) or more of the Company's bank/financial accounts, at which time the Members shall also determine the extent of such signers' rights. 5.3. Limitations on the Powers of the Members. As was stated above, and pursuant to Corporations Code §17704.07(b)(3),while acting in compliance with the wishes and decisions of both Members, each Member has the right,power, and authority to act on behalf of and bind 30352. However, with respect to the following issues, such rights,powers, and authority shall, subject to applicable law, require the consent of both Members: 5.3.1.1. Amendment of this Agreement. 5.3.1.2. Amending the Articles. 5.3.1.3. Adding new Member(s), or otherwise determining the extent of such new a new Member's rights, powers, and authority. 5.3.1.4. Loaning 30352's funds to any other Person, including either Member. 5.3.1.5. Merging with another company or deciding whether to reorganize and/or convert 30352 to a different type of business entity. The Members acknowledge and agree that in either case, each of them shall have all the rights of a dissenter contained in Corporations Code §17711.01, et seq. The purchase of all, or substantially all, of another company's assets(including stock or membership units) or liabilities shall not fall within this provision's voting threshold if such purchase was made within the ordinary course of business for 30352. 5.3.1.6. The sale,Transfer, or disposition of all, or substantially all, of the Company's assets (unless doing so is in the ordinary course of 30352s business). 5.3.1.7. Incurring any debt outside the ordinary course of the Company's business. 5.3.1.8. Entering into an Affiliate Agreement, or once the Company has entered into such an Affiliate Agreement upon the consent of both Members, amending or modifying such an agreement. 5.3.1.9. The settlement of any lawsuit or arbitration in which 30352 is a defendant, cross-defendant, or respondent and: (i)which involves the payment of money by the Company to any other party to the litigation; (ii)the Company's agreeing to injunctive relief against it; and/or(iii) any agreement on the part of the Company which would materially and/or negatively affect the manner in which the Company conducts its business in the ordinary course. Operating Agreement 30352 ESPERANZA,LLC Page 13 of 29 5.3.1.10. The incurring of any debt or obligation on the Company's behalf in excess of$10,000. Any Company checks written to cover such approved debts or obligations must be signed by both Members. 5.3.1.11. The filing of a petition for relief under the United States Bankruptcy Code, or the negotiation of any assignment for the benefit of the Company's creditors. 5.3.1.12. Taking any action which would actually or constructively prevent 30352 from carrying on its normal business operations. 6. ALLOCATION OF PROFIT AND LOSS AND DISTRIBUTION 6.1. Compliance with the Code and Regulations. The Company intends to comply with the Code and all applicable Regulations, including without limitation the minimum gain chargeback requirements, and intends that the provisions contained in this section(and sub-sections) of the Agreement be interpreted consistently with that intent. 6.2. Allocation of Net Profits and Losses. The Members intend upon retaining the services of a qualified tax professional to ensure that 30352 and the Members remain in compliance with applicable provisions of the Code and the Regulations, including those found in §704. Each Member shall be allocated a proportionate share of the Net Profits and Losses of the Company in accordance with his respective Percentage Interest in 30352. Both Members, in consultation with the Company's tax professional(s), shall determine such amounts in compliance with the Code and the Regulations, taking into account any applicable exemptions, expenditures, and depreciation schedules. Notwithstanding any contrary language elsewhere in this Agreement, in the event that the Code or Regulations are amended, or the Company's tax professional(s) inform the Members that any of the allocation requirements contained in this Agreement are unlikely to be upheld, the Members shall have the authority to amend any applicable allocation provisions as minimally as is possible to comport with applicable law. 6.3. Regulatory and Special Allocations. Any allocations made in accordance with this section(and sub-sections) of the Agreement shall be taken into consideration in determining subsequent allocations such that,to the extent possible, the total amount allocated in this and subsequent allocations equals the amount which would have been allocated had there been no regulatory or special allocations. To that end, the Members acknowledge and agree to the following special allocations: 6.3.1. Allocation of Items of Gain. Pursuant to the Regulations (e.g., §1.704-2(g)), in the event of a net decrease in Company Minimum Gain in any taxable Fiscal Year, 30352 shall specially allocate to each Member items of income and gain for that year(and, if necessary, for subsequent years)prior to making any other allocations. 6.3.2. Member Nonrecourse Debt. In the event of a net decrease in Company Minimum Gain based on a Member Nonrecourse Debt in any taxable Fiscal Year, the Company shall first determine the extent of each Member's share of the Company Minimum Gain attributable to Member Nonrecourse Debt(pursuant to the Regulations, Operating Agreement 30352 ESPERANZA,LLC Page 14 of 29 §1.704-2(i)(5). The Company shall then specially allocate items of income and gain for that year(and, if necessary,for subsequent years) in accordance with the Regulations (e.g., §1.704-2(i)(4), (f)(6), or(j)(2))to each Member who has a share of the Company Nonrecourse Debt Minimum Gain. 6.3.3. Member Nonrecourse Deductions. 30352 will allocate Nonrecourse Deductions for any taxable Fiscal Year to each Member in proportion to his Percentage Interest. Pursuant to §1.704-2(i) of the Regulations,the Company will also allocate any Member Nonrecourse Deductions for any taxable Fiscal Year to the Member who bears the risk of loss with respect to the attributable nonrecourse debt. 6.3.4. Negative Capital Account/Income Offset. If a Member unexpectedly receives any Distribution, loss, or deduction allocation within the meaning of the §1.704- l(b)(2)(ii)(d)(4), (5), or(6) of the Regulations which results in the Member's having a Negative Capital Account balance at the end of the taxable Fiscal Year greater than the Member's share of Company Minimum Gain, 30352 shall instruct its tax professional(s) to specially allocate items of income and gain to that Member in a manner designed to eliminate the excess Negative Capital Account balance as quickly as possible. 6.3.5. Adiusted Basis. Pursuant to §704(c) of the Code, and notwithstanding any other provision in this Agreement, income, gain, loss, and deductions with respect to any. property contributed by a Member to 30352 shall, for tax purposes,be allocated among the Members. In making such allocations,the Members, in consultation with the Company's tax professional(s), shall take into account: (i)variations between the adjusted basis of the property contributed to 30352 for federal income tax purposes and its fair market value on the date of contribution; and/or(ii) which of the three allocation methods to rely upon(i.e., traditional, traditional with curative, or remedial). Allocations made pursuant to this sub-section of the Agreement are made solely for federal, state, and local taxes and shall not be taken into consideration in determining a Member's Capital. Account, share of Net Profits or Net Losses, or any other items subject to Distribution under this Agreement. 6.4. Allocation of Profits and Losses Arising Out of Capital Events. In any given taxable Fiscal Year, the Members shall abide by the Code and Regulations in allocating profits and losses arising out Capital Events. 6.5. Distributions. Subject to Corporations Code §17704.05, 30352 shall make Distributions to the Members, and if applicable, to any Transferees with an Economic Interest in the Company, upon the consent of both Members. Distributions shall be made to the Members in accordance with each of their respective Membership Interests in the Company, or with respect to Transferees, in accordance with their respective Economic Interests in 30352. In addition to the foregoing, 30352 shall issue tax advances on the Members' Distributions as follows: 6.5.1. Advances on Distributions. 30352 shall make quarterly cash Distributions to the Members at least fifteen(15) days prior to the due date(s) for any federal estimated tax payments. These estimated tax related Distributions are intended to constitute advances on the Members' respective proportionate Distributions (i.e., they are not additional Operating Agreement 30352 ESPERANZA,LLC Page 15 of 29 Distributions), and shall reduce, by the exact amount advanced, any Distributions due to the Members based upon each Member's proportionate share of the Company's Net Profits. Such Distributions shall be in at least the amount necessary for each Member to make his estimated federal tax payment, which shall be calculated solely upon each Member's proportionate share of the Company's estimated taxable income. The Distribution of any sum less than the minimum Distribution required in this provision shall require the consent of both Members. Any such decision must be applied uniformly to all the Members. Notwithstanding the foregoing,in no event shall the Members ever make any Distributions if in doing so, 30352 will be unable to pay its debts as they become due, or if such a Distribution constitutes a violation of Corporations Code §17704.05. 7. TRANSFER AND TERMINATION OF MEMBERSHIP INTERESTS 7.1. Restriction on Transferability of Membership Interests. Except as expressly permitted in this Agreement, a Member may not Transfer(i.e., assign, encumber, sell, or otherwise convey) all or part of his Membership Interest in 30352 without the consent of the other Member. In entering into this Agreement, each of the Members acknowledges not only the reasonableness and necessity of the restrictions set forth below regarding the Transfer or termination of their respective Membership Interests,but also the fact that such restrictions are intended to further the relationships between the Members. To the maximum extent permitted by law, and pursuant to the terms of this Agreement, any purported Transfer not in compliance with the provisions of this Agreement shall be null and void unless otherwise subsequently consented to in writing by both Members. -, 7.1.1. Exception to Transferability Restrictions. Notwithstanding any contrary language contained in this Agreement, and subject to the following, a Member shall have the absolute right to Transfer all or a portion of his Membership Interest to a revocable trust created by or for his benefit(whether alone or in combination with the Member's spouse, domestic partner, children, and/or heirs),provided that the Affected Member retains for himself the sole right to vote on all issues related to 30352. Within ten(10) calendar days of the non-Affected Member's written request to the Affected Member, the Affected Member shall provide the non-Affected Member with a valid copy of the relevant page(s) of the trust demonstrating the Affected Member's sole right to vote regarding the Company's affairs on behalf of the applicable trust. Once the ten(10) day period has passed, the Affected Member shall have no right to vote on any Company affairs until he has furnished the requested copies. 7.1.2. Conditions Precedent on Transfers. Notwithstanding any contrary language contained in this Agreement, a Transfer of all or any part of a Member's Membership Interest in 30352 may only occur upon the consent of both Members, and such Transfer shall only be deemed complete if the following requirements and conditions are first met: 7.1.2.1. A Transferee selected by the Members to become a new Member must sign this Agreement, an amended and restated version of this Agreement, or any other writing evidencing the Transferee's acknowledgment of and consent to be bound by all the provisions of this Agreement. Operating Agreement 30352 ESPERANZA,LLC Page 16 of 29 7.1.2.2. The Transferee must provide 30352 with a valid social security number or an employment/taxpayer identification number. In addition,upon the request of the Company's tax professional(s),the Transferee must also provide the Company with the Transferee's initial tax basis in whatever transferable interest the Transferee received from the Affected Member. 7.1.2.3. The Transfer is permitted under the Securities Act. And upon request by any Member of 30352, the Transferee shall provide the Members with an opinion letter signed by an attorney licensed to practice law in the State of California indicating that the Transfer in question is in fact permitted under the Securities Act. 7.1.2.4. The Transfer does not render 30352 subject to the Investment Company Act of 1940, as amended, or any successor or equivalent statute, ordinance, and/or regulation. 7.1.2.5. The Transfer does not cause the Company's termination pursuant to any federal or state laws, ordinances,rules, or regulations. 7.1.2.6. The Transfer does not cause the loss of the Company's partnership status for tax purposes, if applicable. 7.1.2.7. The Transferee reimburses 30352 for any reasonable expenses incurred by the Company in connection with the Transfer, or when applicable, the Transferee's admission to membership in 30352 (e.g., accountant, attorney, etc.). 7.1.2.8. Both the Departing Member(or when applicable, the Member whose interest is subject to the Transfer) and the Transferee must strictly comply with all the other provisions of this Agreement 7.2. Voluntary Transfer to a Non-Member Third-Party. The Members expressly intend to treat a Transfer from a Member to a non-Member/non-Affiliate third-party differently from other Transfers or withdrawals. Unlike other Transfers or withdrawals, which constitute Dissolution Events and require some measure of consent from the other Member, a Transfer from a Member to a non-Member/non-Affiliate third-party(whether conforming or not) shall not constitute a Dissolution Event. Nor shall a Member require any consent to seek out and/or locate such a third-party interested in purchasing all or part of the Affected Member's Membership Interest in 30352. Rather, as long as the Members strictly abide by the requirements and conditions set forth above, as well as the following conditions and/or limitations, such Transfers to non- Member/non-Affiliate third-parties shall be permitted: 7.2.1. Company's Right of First Refusal. A Member who wishes to Transfer all or part of his interest in 30352 to a non-Member/non-Affiliate third-party shall immediately provide the other Member(i.e., the Remaining Member)with written notice of his intention(the "Notice"). The Notice shall fully describe the identity of the intended Transferee, the Percentage Interest to be transferred, the price being offered, the terms of Operating Agreement 30352 ESPERANZA,LLC Page 17 of 29 payment, and all other relevant terms of the offer. Upon request, the Departing Member shall also provide the Remaining Member with any reasonable documentation evidencing the bona fide nature of the offer described in the Notice (e.g., the third-party's ability to pay the purchase price, etc.). Subject to the following conditions, the Remaining Member shall then have the option to have 30352 purchase the Departing Member's Percentage Interest at the price and terms stated in the Notice: 7.2.1.1. The Company's right of first refusal option shall remain open and irrevocable for thirty(30) days from the date Notice is provided by the Departing Member. 7.2.1.2. While the right of first refusal option period is open, the Remaining Member may, on the Company's behalf, exercise 30352's right of first refusal at any time upon the consent of the Remaining Member. The Membership Interest of the Departing Member shall not be considered in the vote. 7.2.1.3. If the Remaining Member elect to exercise the Company's option to purchase the Departing Member's Percentage Interest referenced in the Notice (which may or may not constitute the entirety of the Departing Member's Percentage Interest in 30352), the Remaining Member shall provide written notice of that fact to the Departing Member within the right of first refusal option period , ("ROFR Acceptance Notice"). The ROFR Acceptance Notice shall specify a closing date for the purchase, which shall occur within thirty(30) days of the expiration of that option period. On the closing date, 30352 shall tender to the Departing Member the purchase price reflected in the Notice, and in return the Departing Member shall deliver an instrument of title, unencumbered and containing warranties of title, conveying to the Company the Departing Member's Percentage Interest in the Company reflected in the Notice. The Remaining Member shall then distribute the Percentage Interest purchased by 30352 among the Remaining Member pursuant to each Remaining Member's proportionate Membership Interest, or alternatively as the Remaining Member may, in his sole discretion, decide. 7.2.2. Decision Not to Purchase Per Notice. If the Remaining Member decides not to exercise the Company's right of first refusal option, or alternatively fails to send a timely ROFR Acceptance Notice to the Departing Member, the Departing Member shall have ninety(90) days to complete the Transfer to the Transferee named in the Notice on the exact same terms specified in the Notice, and subject to the requirements set forth in this Agreement. The Departing Member shall continue to exercise his full rights as a Member until the closing of the Transfer. Once the Transfer has been consummated(i.e., once the closing occurs), the Departing Member shall provide written notice to the Remaining Member of the closing date. In no event shall the Company be required to recognize either the Transfer or the Transferee's rights until such notice has been delivered to the Member(s) and the other applicable requirements set forth in this Agreement have been satisfied. Operating Agreement 30352 ESPERANZA,LLC Page 18 of 29 - 7.2.3. Partial Transfer. In the event that the Departing Member Transferred less than his entire Membership Interest in 30352 to the Transferee, as set forth in the Notice, the Departing Member shall still: (i)hold whichever portion of his Membership Interest he did not Transfer; (ii) be deemed a Member; (iii)have voting rights proportionate to his post-Transfer Percentage Interest; (iv)participate in the management of the Company; and(v)receive his post-Transfer proportionate share of the Company's Distributions. The Transferee, in turn, shall hold only an Economic Interest in 30352 and shall not be deemed a Member until or unless the Remaining Member agrees to make the Transferee a Member. And in the event that the Remaining Member does decide to make the Transferee a Member, he shall, at that time, also determine whether or not the Transferee will participate in the management of the Company. With respect to the latter, if the Remaining Member decides to add the Transferee as a non-managing Member, the Remaining Member shall amend the Articles to state that 30352 is a"manager-managed" limited liability company. 7.2.4. Total Transfer. In the event that the Departing Member Transferred the entirety of his Membership Interest in 30352 to the Transferee, as set forth in the Notice,upon the closing date the Departing Member shall no longer be a Member of 30352. The Transferee, in turn, shall hold only an Economic Interest in the Company and shall not be deemed a Member until or unless the Remaining Member agrees to make the Transferee a Member:. And in the event that the Remaining Member does decide to make the Transferee a Member, he shall, at that time, also determine whether or not the Transferee will participate in the management of the Company. With respect to the latter, if the Remaining Member decides to add the Transferee as a non-managing Member,the Remaining Member shall amend the Articles to state that 30352 is a"manager-managed" limited liability company. 7.2.5. Wrongful Transfer. If a Member purports to have transferred all or part of his Membership Interest in the Company to a non-Member/non-Affiliate third-party without abiding by the requirements contained in this Transfer and Termination section of the Agreement, including honoring the Company's right of first refusal, then subject to applicable law,the purported Transfer shall be void and the purported Transferee shall have no rights whatsoever in the Company(i.e., neither the Remaining Member nor the Company shall recognize the Transfer). In the event applicable law prohibits such a result, or otherwise prevents the Remaining Member from enforcing or exercising his right of first refusal, then the purported Transferee (and the Departing Member if the purported Transfer was less than the Departing Member's entire Percentage Interest) shall hold only an Economic Interest in the Company, with no right to vote on any matters pertaining to 30352. In no event,however, shall either the Transferee or the Departing Member be deemed Members of the Company in such a scenario. 7.3. Transfer of Member's Interest Upon Occurrence of Dissolution Event. Subject to applicable law (e.g., Corporations Code §17707.03), upon discovering the occurrence of a Dissolution Event, the Remaining Member shall dissolve and wind up the Company's affairs unless he elects, within ninety(90) days after he learns of the Dissolution Event,to continue the Company's normal business operations. Operating Agreement 30352 ESPERANZA,LLC Page 19 of 29 7.3.1. Death or Incapacity of a Member. In the event of the death or Incapacity of a Member, if the Remaining Member elects not to continue operations,he shall wind up and dissolve 30352 and make all Distributions pursuant to applicable law. However, if the Remaining Member does decide to continue operating the Company, the deceased Member's Estate Representative(s) shall have only the rights of a Transferee (i.e., an Economic Interest)until and unless, in the Remaining Member's sole discretion,the Remaining Member tenders to the deceased Member's Estate Representative(s), an amount sufficient to purchase the entirety of that Economic Interest. Consequently, for purposes of this provision,the lack of"management rights" shall not prevent an Estate Representative from reasonably disputing the below-discussed appraisal generated by the Appraiser or the selection of the Appraiser. In addition to the foregoing, the Members also agree that: 7.3.1.1. In the event of any dispute (including,but not necessarily, in the form of legal action) on the part of one(l) or more of the Affected Member's Estate Representatives regarding any of their respective rights, including those related to the management of the Company or the right to receive Distributions (whether upon dissolution or otherwise): (i)until the Estate Representatives resolve their dispute in a satisfactory fashion (discussed below), no Estate Representative shall be entitled to vote on any matters related to 30352; (ii) the Remaining Member may deposit all Distributions intended for the Affected Member's Estate Representatives into an isolated account until a satisfactory resolution of the dispute is reached; and/or(iii)the Remaining Member may interplead all Distributions with a court of competent jurisdiction pending a judicial resolution of the dispute. Satisfactory resolution may come in the form of a judicial order or approved stipulation by a court of competent jurisdiction, or if no legal action is then pending, a fully executed settlement agreement/stipulation which the Company's counsel is satisfied complies with applicable law. The Affected Member's estate (or Estate Representatives, whichever the case may be) shall be jointly and severally liable to the Remaining Member and/or the Company for all attorneys' fees and costs incurred by the Remaining Member and/or the Company in addressing such a dispute, and all such fees and costs may be deducted from any Distributions set aside pursuant to this provision. Finally, the Members acknowledge and agree that 30352 shall not be liable for any damages or claims related to its good faith compliance with this provision, and instead, the Affected Member's estate and his Estate Representatives shall indemnify and hold the Company harmless from all such damages or claims. 7.3.1.2. Assuming that the Remaining Member did not opt to simply purchase the Estate Representatives' Economic Interest,upon providing written notice to the Remaining Member, the Affected Member's Estate Representatives may take whatever actions they deem appropriate to exercise their rights, authority, and powers in compliance with this Agreement, including dividing the Affected Member's Membership Interest amongst themselves, resulting in multiple new Members (each with a portion of the Percentage Interest previously held by the Affected Member). Operating Agreement 30352 ESPERANZA,LLC Page 20 of 29 7.3.1.3. In no event shall the decision of the Affected Member's Estate Representatives to divide the Affected Member's Percentage Interest amongst themselves constitute a Transfer on the part of the Affected Member or his estate, nor require the consent of the Remaining Member. 7.3.2. Purchase Price. When a Dissolution Event occurs, if the Remaining Member decides to purchase the above-referenced Economic Interest(s) of the Estate Representative(s),the Remaining Member, in concert with the Departing Member(or the Departing Member's Estate Representatives), shall first attempt to establish the fair market value of the Company(the "Value") as of the date of the Dissolution Event. This valuation shall occur on or before the fifteenth (15th) day following the later of: (i)the date of the Dissolution Event; or(ii)the date the Remaining Member first acquired knowledge of the Dissolution Event. In the event that the Remaining Member and the Departing Member cannot agree on the Value,the Value shall be determined by an appraisal conducted pursuant to the following: 7.3.2.1. The Remaining Member shall select a qualified and independent business appraiser(the"Appraiser"), subject to the reasonable approval of the Departing Member(or the Departing Member's Estate Representative(s)). The Appraiser shall determine the Value of the Company using commonly accepted accounting and valuation principles and shall complete that valuation on or before the sixtieth (60th) day following the Remaining Member' receipt of notice of the event triggering the sale. Upon written request by the Appraiser, 30352 shall be entitled to an extra thirty (30) days to deliver a completed appraisal. The Company shall pay for the costs associated with the Appraiser. If the Company fails to obtain an appraisal from its Appraiser,the appraisal generated from the below-defined Departing Member's Appraiser shall be deemed the final appraisal. 7.3.2.2. In the event a Departing Member(or the Departing Member's Estate Representative(s))reasonably disputes the Value established by the Appraiser(at which point the Departing Member shall have ten (10) calendar days to deliver to the Remaining Member a written explanation describing the nature, extent, and reasons for the dispute), the Departing Member shall have the right, at the Departing Member's own expense, to have an independent appraisal performed by an appraiser of the Departing Member's choosing (the "Departing Member's Appraiser"). The Departing Member's Appraiser shall determine the Value of the Company using commonly accepted accounting and valuation principles. The Departing Member shall then have sixty(60) days from the date the Departing Member delivers the above-referenced written explanation to deliver to the Remaining Member the written appraisal prepared by the Departing Member's Appraiser. If the lower value of the two (2) appraisals described above is at least eighty five percent(85%) of the higher value,the Value shall be equal to the average of the appraised value generated by the Appraiser and the appraised value generated by the Departing Member's Appraiser. However, in the event that the lower value is less than eighty five percent(85%) of the higher value, the average of the values obtained by the Appraiser and Departing Member's Appraiser shall be disregarded. Instead, the Remaining Member shall then select a third Operating Agreement 30352 ESPERANZA,LLC Page 21 of 29 appraiser, subject to the Departing Member's reasonable input, whose appraisal shall be final (the"Final Appraiser"). The Final Appraiser shall be selected and the appraisal completed and delivered to the Departing Member within forty-five (45) days following the completion of the appraisal by the Departing Member's Appraiser, subject to a reasonable extension requested by the Final Appraiser. Upon the determination of the Value, the purchase price to be paid for the Membership Interest of the Departing Member shall be equal to the Value multiplied by the Departing Member's Percentage Interest in the Company(the "Purchase Price"). 7.3.3. Purchase by Remainint Member. Once the Purchase Price has been determined, the Remaining Member may purchase the Departing Member's Membership Interest. In making the election to purchase the Departing Member's interest, the Parties. agree that the Remaining Member shall assign a closing date to occur within sixty(60) days after the Purchase Price has been determined. The Remaining Member shall have the option, in his reasonable discretion, to extend the closing date an additional sixty(60) days. Upon the closing date, the Departing Member(or the Departing Member's Estate Representatives) shall deliver to the Remaining Member any documents reasonably necessary to effectuate an encumbrance free Transfer of the Departing Member's Membership Interest in 30352 to the Remaining Member. In return, the Departing Member shall be paid the Purchase Price. 7.4. Spousal Matters. The Members agree that each of their respective spouses shall sign the Spousal Consent Form attached to this Agreement as Exhibit `B." Each Member shall indemnify and hold the Company and the other Member harmless from any losses, claims, or liabilities, including attorneys' fees and costs, resulting from the Member's failure to obtain his spouse's signature on the Spousal Consent Form. In addition, the Members further agree to the following: 7.4.1. Divorce. Upon a court ordered dissolution of the marriage of any married Member, the Member's Membership Interest shall be allocated pursuant to the court's dissolution order. However,with respect to such an allocation: 7.4.1.1. No spouse shall become a Member of 30352 as a result of an allocation, distribution, or stipulation of or regarding the Affected Member's Membership Interest. 7.4.1.2. In the event that a court order and/or stipulation allocates or distributes all or portion of the Affected Member's Membership Interest.to the Affected Member's spouse, that spouse shall hold only the rights of a Transferee. 7.4.1.3. The Member shall continue to exercise all voting rights in proportion to the entire Percentage Interest held by both the Member and his spouse (as a Transferee) notwithstanding the fact that the spouse may be entitled to a certain percentage of the Distributions. Operating Agreement 30352 ESPERANZA,LLC Page 22 of 29 7.5. No Release of Liability. The Members acknowledge and agree that absent a separate written agreement,upon payment of the Purchase Price to a Departing Member, the Departing Member will not be released from any claim or liability to the Company or the Remaining Member, or for any of the Company's actions or inactions,which occurred prior to the Departing Member's departure from 30352. 8. BOOKS, RECORDS,AND REPORTING 8.1. Books and Records of the Company. The Members shall maintain and keep at the Company's principal place of business, and/or at any other location that both Members may decide, the following books and records: (i) an alphabetical list of names and addresses of the Members, together with each Member's Capital Contribution, Capital Account, and Membership/Percentage Interest; (ii) a copy of the Articles and any amendments, and if applicable, any powers of attorney under which the Articles were signed; (iii) copies of the Company's federal, state, and local income tax or information returns and reports, if any, for the six (6)most recent taxable years; (iv) a copy of this Agreement and any amendments, and if applicable, any powers of attorney under which the Agreement was signed; (v) copies of the Company's financial statements, if any, for the six (6)most recent Fiscal Years; (vi) other books and records related to the Company's internal affairs for the current and previous four(4) years; and(vii) minutes of all meetings, along with related notices, waivers, and consents, if any. 8.2. Inspection Rights. For purposes reasonably related to a Member's or Transferee's interest in 30352, and upon reasonable written request, all Members and Transferees shall have the right to inspect and copy, during normal business hours: (i) at the Company's expense,the books and records of the Company required to be maintained pursuant to Corporations Code §17701.13(d)(1), (2), and(4); and(ii) at the Member's/Transferee's expense, the books and records of the Company required to be maintained under the remaining sub-sections of Corporations Code §17701.13(d). 8.3. Accounting Method. Both Members shall select the method of accounting best suited for the Company for tax purposes, and the books and records of the Company shall be maintained in accordance with that accounting method. Likewise, while the Members are free to prepare and maintain the Company's financial records in a manner best suited to its needs,upon an affirmative vote of both Members of 30352, the Company shall be required to prepare and maintain its financial records in accordance with generally accepted accounting principles. 8.4. Financial Statements/Reports to Members. The Members shall timely prepare, maintain, furnish to each Member or Transferee, and/or file with the appropriate governmental agencies, all reports and documents required by applicable law. The Members may then submit such documents to their tax advisor(s) to determine their respective Adjusted Taxable Income. To that end,the Members agree as follows: 8.4.1. Fiscal Year. The Company's Fiscal Year shall be January 1 to December 31. 8.4.2. Documents Necessary for Member Tax Returns. On at least an annual basis, but no more than ninety(90) days following the end of the Fiscal Year, the Tax Matters Member shall ensure the preparation and delivery to all the Members and Transferees of Operating Agreement 30352 ESPERANZA,LLC Page 23 of 29 I all documents and information necessary for the Members/Transferees to prepare their federal and state tax returns. 8.4.3. Tax Matters Member. Subject to applicable tax laws and regulations, the Members designate Cesar Meyer as the Tax Matters Member(within the meaning of §6231(a)(7) of the Code) to not only make any income tax election he deems advisable following consultation with the Company's financial advisors,but also to represent 30352 in all examinations of the Company's tax related affairs and/or inquiries by taxing authorities. The other Member is free to file a statement with an applicable taxing authority indicating that the Tax Matters Member is not authorized to speak for him,but absent such a statement, the Tax Matters Member shall be authorized to negotiate, settle, and compromise with any applicable taxing authorities on behalf of 30352. The Company shall reimburse the Tax Matters Member for all expenses incurred, and the Company authorizes the Tax Matters Member to use Company funds to obtain necessary professional services in connection with such examinations by taxing authorities. In addition to the foregoing, the Members acknowledge and agree that: 8.4.3.1. No Member will treat, on his own tax returns, any item related to 30352 inconsistently with how the Company treated that item. 8.4.3.2. In the event the Company pays a Member's deficiency assessed by a taxing authority, that Member shall reimburse 30352 for the payment, and such amount shall be recoverable by the Company from the Affected Member, either as an offset to future Distributions or otherwise. 8.4.3.3. The Tax Matters Member may resign at any time and in his sole discretion. Upon such a resignation,both Members must select another Member to become the new Tax Matters Member. 9. DISSOLUTION,LIQUIDATION,AND WINDING UP 9.1. Conditions Under Which Dissolution Shall Occur. The Members shall dissolve 30352 and wind up its affairs upon the earliest occurrence of any of the following events: (i) at the time or occurrence of an event specified in the Articles, if any; (ii)upon the occurrence of a Dissolution Event, and the failure by the Remaining Member to elect to continue operating the business (in accordance with the provisions set forth above); (iii)upon the election of the Members to dissolve; (iv)upon the entry of a decree of judicial dissolution pursuant to California Corporations Code §17707.03; or(v)upon the sale or Transfer of all, or substantially all, of the Company's assets, unless such sale or Transfer is part of the ordinary course of the Company's business. 9.2. Winding Up and Dissolution. Upon the dissolution of 30352,the Members shall wind up the Company's affairs by, among other things, selling all of the Company's assets and providing written notice to all creditors, if any, regarding the dissolution. In liquidating the Company's assets, the Members shall use commercially reasonable efforts to maximize the sale prices. Members shall be entitled to reasonable compensation for providing their services to wind up the Company's affairs. During this time period, the Company shall continue solely for Operating Agreement 30352 ESPERANZA,LLC Page 24 of 29 the purpose of winding up its affairs in an orderly manner, liquidating its assets, and satisfying the claims of its creditors, if any. 9.3. Order of Payment. After determining that all known debts and liabilities of 30352 been paid or provided for, including, without limitation, the costs of liquidation and the debts and liabilities owed to Members who are creditors of the Company, and after determining that no contingent reserve is necessary, the Company's remaining assets shall be distributed, in cash, property other than cash, or both, first to each of the Members pursuant to each Member's Membership Interest in the Company, and then to any Transferees pursuant to each Transferee's Economic Interest. Unless required by applicable law, Members shall not be required to restore Negative Capital Account Balances. 9.4. No Right to Cure Deficits. Except as otherwise provided in this Agreement or by the Act, the Members may look solely to the Company for payment of their Capital Account balances. In no event shall a Member be entitled to recover a Positive Capital Account balance or proportionate share of the Net Profits from any other Member. 9.5. Fi1in2 of Certificates. Upon the dissolution of 30352, the Members shall file a Certificate of Dissolution with the Secretary of State. After completion of the winding up of the Company's affairs,the Members shall file a Certificate of Cancellation of the Articles with the Secretary of State. 9.6. Intellectual Property. Upon the dissolution of 30352, the Company's intellectual property(e.g., patents, copyrights, trademarks) shall revert to the Member(s)who contributed such intellectual property, either as part of their Capital Contribution, or at any later time as long as the Member created the intellectual property prior to becoming a Member. The Members shall sign any documentation necessary to effectuate the intent of this provision. 10. CONFIDENTIAL INFORMATION 10.1. Keeping Confidential Information Confidential. The Members acknowledge and agree that in their capacities as managing Members of 30352, they will have unfettered access to the Company's Confidential Information. The Members further acknowledge and agree that the Confidential Information represents (and will continue to represent) a special,unique, and valuable asset to the Company which the Members have already invested(and will continue to invest) substantial time, money, knowledge, and energy developing. Based upon the foregoing, and based upon the likely loss of the Company's competitive advantage in the face of a wrongful disclosure of its Confidential Information to a non-Member, no Member shall, while still a Member or at any time afterwards, directly or indirectly, wrongfully use or profit from, or otherwise disclose the Company's Confidential Information to any non-Member unless that Person requires access to the Confidential Information to: (i)perform approved services or job duties on behalf of 30352; (ii)review or analyze the status of his investment in the Company; (iii)prepare, file, or pay his (or a Member's/Transferee's)taxes; (iv) conduct due diligence as part of a potential purchase or Transfer of a Member's Membership Interest; or(v)upon the consent of both Members. In addition,the Members further agree as follows: Operating Agreement 30352 ESPERANZA,LLC Page 25 of 29 10.1.1. Reasonable Steps to Safeguard. Each Member shall take all reasonable steps to safeguard the Company's Confidential Information and to prevent its unapproved or inadvertent disclosure, or its misuse,theft, or loss. Such steps shall include, without limitation,ensuring that recipients of the Confidential Information are entitled to have access to the Confidential Information, are aware of its confidential nature, and bound by a written confidentiality or non-disclosure agreement at least as protective as are those contained in this provision. 10.1.2. Exceptions to Confidentiality. Confidential Information shall not include any information which: (i) is already in the public domain or which becomes so through a conscious decision by both Members of 30352; (ii)pursuant to documentary proof, a Member independently developed without the use of the Company's resources or Confidential Information; or(iii)pursuant to documentary proof, a Member receives in good faith from an independent third-party who is not otherwise not bound by a confidentiality agreement or duty of confidentiality. 10.1.3. Operation of Law. Notwithstanding the foregoing, no Member shall be prohibited from disclosing Confidential Information sought by operation of law(e.g., as a result of a valid subpoena, court order, deposition, etc.)provided that prior to any disclosure of the Confidential Information, the Affected Member must take all reasonable steps to provide the other Members with prompt notice sufficient to permit the Company to contest such disclosure. 10.1.4. Irreparable Harm. In the event of a breach of any of the confidentiality provisions of this Agreement, the Company will likely suffer irreparable injury and damage for which money damages may not be adequate or may be difficult to ascertain. Consequently in the event of such a breach, or a reasonably anticipated breach, in addition to the Company's other legal and equitable remedies, 30352 shall be entitled to seek injunctive relief without the necessity of posting a bond. 10.1.5. Survival. The Members' obligations under the confidentiality provisions of this Agreement shall survive the Members' withdrawal or dissociation from 30352, and to the extent that such Confidential Information reverts back to other Members, it shall also survive the Company's termination, dissolution, or winding up. 11. INDEMNIFICATION OF AGENTS 11.1. 30352 Shall Indemnify Agents. To the fullest extent permitted by the Act, 30352 shall indemnify any Member, and may indemnify any Person, from and against any liabilities,losses, damages, claims,judgments, settlements,penalties, fines, fees, or costs of any kind(including attorneys' fees and costs) incurred as a result of that Member's or Person's actions or inactions performed(or not performed) in his capacity as a Member, manager, officer, employee, or agent of the Company, as long as the Member or Person did not commit any acts of fraud, deceit, or breach of fiduciary duty. Operating Agreement 30352 ESPERANZA,LLC Page 26 of 29 12. ACKNOWLEDGMENT OF INVESTMENT 12.1. One Class. 30352 shall have only one (1) class of Membership Interest. 12.2. Preexisting Relationship. The Members have preexisting personal and/or business relationships with each other. The Members are also fully capable of evaluating the risks and merits of their investment in 30352 and of protecting their own interests. 12.3. No Advertising. The Members have not seen,received,been presented with, or been solicited by any leaflet,public promotional meeting, or advertisement related to an investment in 30352. 12.4. Economic Risk. The Members are all financially able to bear the economic risk of an investment in 30352, including a total loss of that investment. The Members further acknowledge that.their investment in the Company comes with an inherent risk of loss—even as to their entire Capital Contributions—and that each of them fully understands the risks, recognizing that 30352 is a newly organized entity with no operating history. 12.5. Non-Registration. Neither the Membership Interests nor Certificates, if any,have been registered under the Securities Act of 1933, as amended(the "Securities Act"), or qualified under the California Corporate Securities Law of 1968, as amended. 12.6. Tax Consequences. The Members acknowledge that the tax consequences to each of theirs of investing in the Company will depend on their particular circumstances, and in no event shall 3 03 52,the other Members, or their respective attorneys, accountants, agents, representatives, or Affiliates shall bear any responsibility or liability for such tax consequences. 13. GENERAL PROVISIONS 13.1. Notices. Subject to any other specified means of communication set forth elsewhere in this Agreement, all notices required under this Agreement shall be in writing and shall be deemed delivered if delivered to each of the Members or the Company's principal business address, and: (i)when delivered by hand with written confirmation of receipt; (ii) when delivered by a reputable delivery service (e.g., Federal Express, United Parcel Service)requiring a signature upon receipt; and/or(iii)when delivered (or delivery is attempted)by the United States Postal Service if sent via certified mail, return receipt requested. Notwithstanding the foregoing, upon the consent of both Members in 30352, service of notices required under this provision shall be deemed delivered on the date of receipt if sent via fax or email. In the event the Members make such an election, the fax number(s) and email address(es) of each Member shall be recorded in the books and records of the Company and available to Members and Transferees for the purpose of providing notices required under this Agreement. Likewise,upon the consent of both Members of 30352,notices required under this Agreement shall also be sent to designated third-parties, such as the Company's attorneys. In the event the Members make such an election, the address(es), fax number(s), and/or email address(es) of such individuals shall be delivered to the Members and Transferees and recorded in the books and records of the Company. Operating Agreement 30352 ESPERANZA,LLC Page 27 of 29 13.2. Headings. The section headings which appear throughout this Agreement have been provided solely for the convenience of the Members, and do not define or limit the scope of any provision. Consequently, the headings shall not be considered when interpreting this Agreement. 13.3. Execution of Documents and Other Acts. In connection with the formation, operation, and maintenance of 30352, each Member shall sign any documents and certificates, and otherwise perform any acts required under this Agreement,required by the Act, or which are deemed reasonably appropriate by both Members. 13.4. No Waiver. No breach of any provision(s) of this Agreement shall be deemed waived unless done so in a writing signed by the Members. Waiver of any one (1)provision of this Agreement shall not be deemed to be a waiver of any other provision, nor shall a waiver of a specific provision on one (1) or more occasions be deemed a permanent waiver of that provision. 13.5. Interpretation. All pronouns and common nouns shall be deemed to refer to the masculine, feminine, neuter, singular, or plural, as the context may require. Use of the word "Agreement" shall mean and refer not only to this Agreement,but also to any specified exhibits or subsequent amendments, regardless of whether or not such exhibits were incorporated into this Agreement by reference. In addition, any use of the terms "include,""includes,"or "including"in this Agreement, each shall be understood to also include the phrase"without limitation." 13.6. Arm's Length. The Members acknowledge and agree that each of them entered into this Agreement knowingly and voluntarily, at arm's length, and with a full understanding of the legal significance and ramifications for doing so. Each of the Members has had the advice and counsel of an attorney of his own choosing, or had an opportunity to seek such advice and counsel and elected not to do so. Each of the Members therefore agrees that any rule of law or legal decision which would require interpretation of this Agreement against the Party that drafted it, including Civil Code §1654, shall not be applicable, and in fact is irrevocably and unconditionally waived. 13.7. Severability. In the event that all or part of any provision in this Agreement becomes or is declared by a court of competent jurisdiction to be illegal,unenforceable, or void, this Agreement shall continue in full force and effect without such language. However, if the absence of such language materially alters the rights, limitations, and/or obligations of the Members, the above-referenced court shall determine the rights, limitations, and/or obligations of the Members pursuant to the intent of this Agreement as a whole. 13.8. Successors and Assigns. Subject to the provisions of this Agreement relating to the transferability of Membership interests, this Agreement shall be binding upon and shall inure to the benefit of the Members, as well as their respective successors, assigns, and Estate Representatives. 13.9. No Third-Party Beneficiaries. Except as specifically stated above (e.g.,regarding Transferees), nothing in this Agreement is intended or should be construed to give any Person, other than the Members (and their permitted successors and assigns), any legal or equitable right, remedy, or claim under this Agreement. Operating Agreement 30352 ESPERANZA,LLC Page 28 of 29 13.10. Entire Agreement. This Agreement constitutes the entire understanding and agreement between the Members relating to their respective Membership Interests in 30352. This Agreement therefore supersedes all previous understandings or agreements, whether written or oral,between the Members relating to such membership. Any amendments or modifications to this Agreement shall be effective only if in writing and signed by all of the Members. 13.11. Applicable Law,Jurisdiction, and Venue. This Agreement shall be governed by the laws of the State of California. Each Member agrees to submit to the exclusive jurisdiction of the federal and state courts of the State of California in any action arising out of a dispute or interpretation of this Agreement,with venue in the County of Orange. 13.12. Attorneys' Fees. If any legal action is brought to enforce and/or interpret this Agreement, the prevailing Party shall be entitled to recover their reasonable attorneys' fees and costs incurred in that action or proceeding, in addition to any other relief to which they may be entitled. 13.13. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which shall, when taken together, constitute a single document. IN WITNESS WHEREOF, both of the Members of 30352 Esperanza, LLC, a California limited liability company, have signed this Agreement, effective as of the dates set forth below. MANAGING MEMBER MANAGING MEMBER Date: Date: By: By: //"7 7sar eye Broc Ward Operating Agreement 30352 ESPERANZA,LLC Page 29 of 29 EXHIBIT A TO OPERATING AGREEMENT OF 30352 ESPERANZA, LLC MEMBERS & CAPITAL CONTRIBUTIONS EXHIBIT "A" Members & Capital Contributions Member Name Address Capital Contribution Percentage Interest 5 Lennox Cesar Meyer contributed: (i) Cesar Meyer Ladera Ranch, CA 92694 $10,000; (ii) loan commitment, 50% including, if necessary,a personal guaranty; and(iii)sweat equity Brock Ward contributed: (i) Brock Ward 20 Indian Pipe $10,000; (ii) loan commitment, 50% Trabuco Canyon,CA 92679 including, if necessary, a personal guaranty; and(iii)sweat equity Exhibit"A"to Operating Agreement 30352 ESPERANZA,LLC Page 1 of 1 EXHIBIT B To OPERATING AGREEMENT OF 30352 ESPERANZA, LLC SPOUSAL CONSENT FORM GG 9� Spousal Cousent Form L the undersigned,am the spouse of c tom. G•r. a:� =,, e xC 30353 Fstserats a,LI. {`"3{135Z")and a.party tr;ttze Agreeme'a rto v�'hych this l lztbat;s t tckie mom. i have read the Agreementj i understand its coutcnts and i expressly aokzaov?rtec gc that thu Agreetaent evatains pr=,ov�s orgy which.my spoutie grafts;3�}3�2 a d 7rt +atltez n VlLtlhe riS Eti�xo pttcz hsse my,spouse s Membersh interest w r Gom sa anc ltt xh mr c.rarsr trni p y� s c firth rsl,il`atiy. T accept,and agree to the forega hg:provikion and ci�nsent to sixth,a sale,shattt it o ci r TAgr . that-any.interest"l may h zv°e in 303$2(inclu ing my spouse's�lletnk etsiZt T t�z t)is sabject ta.. the l rovislons a.11lis Agreement inclzitli»g,vxrithditt tsmzii�t on,the r eemei is Transfer limitations; I therefore agree to take rto actionn to'hindex:or;clelay the operatic n o tS1e:Gozrzpar?y r�itl;:.rcgazcl tct my spouses Mezxtlsership;interest(or,f'or.th'at matter; aay iriWrest-1 ttaAy Savo iu tlts�"arap{zriy}. .r. F g In .6t [NATME car SPOUSE [sxc�r�Ar' lEc� si}vu ] E hibit l3"fa Op r�tec emeni ` 3t1352 ks��I#3 �A,JGd i '. spousal'Consent < 3 the andersig pod tua w spwsi�of his bibitU;I havo rat Amnt,[ dert nitnts, a a �s Agreen (Contain t to to< �3 m i . t r t� 1 cow "xi :infix - W, MI . tri. ti any. that ady,interest 1 my.havc ih 30352(ifteludigg sty ti l's Memb rAftip, 101terq4t)J t t t n =. tar n to t� ray t' n t "` a � Company witht t m t ithat tt t the �t� ). F ANZ-AF,