in Re: John Calce

ACCEPTED 05-18-00647-CV 05-18-00647-CV FIFTH COURT OF APPEALS DALLAS, TEXAS 6/4/2018 2:36 PM Part 3 of 5 LISA MATZ CLERK No. 05-18-00647-CV In the Court of Appeals FILED IN Fifth District of Texas at Dallas 5th COURT OF APPEALS DALLAS, TEXAS 6/4/2018 2:36:42 PM LISA MATZ Clerk In re JOHN CALCE Relator RECORD FOR PETITION FOR WRIT OF MANDAMUS Relator John Calce submits this record of trial court proceedings in support of his petition for writ of mandamus. Index of Documents # Date Description Record Pages 1 6/26/16 Plaintiff’s Original Petition 001-023 2 7/31/17 John Calce’s Original Counterclaim Against 024-172 Centurion Logistics LLC and Centurion Pecos Terminal LLC 3 11/22/17 John Calce’s First Amended Counterclaim 173-321 Against Centurion Logistics LLC and Centurion Pecos Terminal LLC 4 11/22/17 John Calce’s Amended Motion for Partial 322-393 Summary Judgment Regarding Counterclaim Against Centurion Logistics LLC 10000280.1/SP/38371/0105/060118 5 11/27/17 John Calce’s Supplemental Evidence in 394-405 Support of Calce’s Amended Motion for Partial Summary Judgment Regarding Counterclaim Against Centurion Logistics LLC 6 12/8/17 Plaintiff’s Response to John Calce’s Amended 406-858 Motion for Partial Summary Judgment Regarding Counterclaim Against Centurion Logistics LLC 7 12/12/17 John Calce’s Reply Brief in Support of 859-865 Amended Motion for Partial Summary Judgment Regarding Counterclaim Against Centurion Logistics LLC 8 12/15/17 Notice of Trial Setting 866 9 5/2/18 Plaintiffs’ Second Amended Petition 867-903 10 5/21/18 Order Denying John Calce’s Amended 904-905 Motion for Partial Summary Judgment Regarding Counterclaim Againt Centurion Logistics LLC 10000280.1/SP/38371/0105/060118 Declaration of Chase J. Potter STATE OF TEXAS § COUNTY OF DALLAS § My name is Chase J. Potter. My date of birth is May 12, 1986. My address is 901 Main Street, Suite 6000, Dallas, Texas 75202. I hereby declare under penalty of perjury as follows: 1. I am over eighteen years of age and am fully competent to make this declaration. I am an attorney licensed by the Supreme Court of Texas and am counsel for Relator John Calce in this case. 2. The factual statements contained within this instrument are within my personal knowledge and are true and correct. 3. The copies of pleadings, motions, and other documents included in this Record for Petition for Writ of Mandamus are true and correct copies of these documents as filed in the trial court. Executed in Dallas County, Texas, on June 4, 2018. /s/ Chase J. Potter Chase J. Potter, Declarant 10000280.1/SP/38371/0105/060118 income, gain, loss. or d~duction rcq ui red to be stated separately pHrsuant to f. R. C. Section 703(a)( I) shall be included in taxable incorne or loss). with the follmving m.ljllstments: (i) Any income or the Company that is exempt from federal incom0 tax and 11ol otherwise taken illtO accuu111 in l'.urnputing Ntt Profit or Nd Loss :-;hall be added to such taxable income or loss. (ii) Any expenditures of the Company described in l.R.C. Section 705(a)(2)(B) or treated as I.R.C. Section 705(a)(2)(8) expenditures pursuant to Treasury Regulations Section 1.704-l(b)(2)(iv)(i), and not othenvise taken inlo account in computing Net Profit or Net I.oss. shall be s11btracted from such taxable income or loss. (iii) If the Gross Asset Value of any Company asset is adjusted pursuant to subparagraph (ii). or (iii) or the Section A.2 definition of Gross Asset Value. the amount of such adjustment shall be taken into account as gain or loss from disposition of the asset for purposes or computing Net Profit and Net I,oss. (iv) Gain or loss resulting from any disposition or Company property with rc;;;pect to which gain or loss Ls recognized for federal income tax pmposcs J:;hall b~ computed by reference to the Gross Asset Value of the property disposed of (unreduced h1 any liabilities attributable thereto), notwithstanding that the adjusted tax basis of such property differs from its Gross Asset Value. (v} ln lieu of the depreciation, amortization. and other cost recovery deductions taken into account in computing such taxable income or loss, thcr~ shall be taken into account Depreciation compukd in acconfoncc with the definition of Depreciation in Section A.2. (vi) To the extent an adjustment to the adjusted iax basis or any Company asset pursuant to LR.C. Section 734(b) is required pursuant to Treasury Regulations Section l.704-1 (b)(1)(iv)(m)( ./) to be taken into acconnt in determining Capital Accounts as a reslllt of a distribution <>ther than in liquidation of a Member's Membership interest. the amount of such adjustment shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases the basis of1he asset) frum the disposition of the asset and shall he taken into account for purposes or computing r-..;et Profit or Net Loss. "'Nonrecourse Deductions'' has the mea11ing set forth in Tr~usury Regulations Section I. 704-?(b)( l) and shall be determined according to the provisions of lre(lsttry Regulations Section 1. 704-2( c ). '"Nonrecourse Liabilitv·· has the meaning set forlh in Treasury Regulations Section I .704- 2(b)(3). 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Expires 07·08-2020 "'i~Of. ""\V,,. . . '''11111'' Notary ID 130731546 Amended Affidavit of Antonio Albanese 7 MR.466 ([KLELW³&´ MR.467 &$86(12'& &(1785,21/2*,67,&6//& ,17+(',675,&7&28572) LQGLYLGXDOO\DQGGHULYDWLYHO\RQEHKDOIRI &(1785,213(&267(50,1$///& D7H[DVOLPLWHGOLDELOLW\FRPSDQ\ 3ODLQWLII YV '$//$6&2817<7(;$6 -$0(6%$//(1*((%$//(1*(( ,17(5(676//&-2+1&$/&( &+5,6$02777205$06(< 67$03('(7;(1(5*<//& &(1785,210,'675($0*5283//& &(1785,217(50,1$/6//& &(1785,21%52:169,//( 7(50,1$///&-$0(6+2&. -83,7(50/3//& 'HIHQGDQWV %WK-8',&,$/',675,&7 DQG&(1785,213(&267(50,1$/ //&D7H[DVOLPLWHGOLDELOLW\FRPSDQ\ 1RPLQDO'HIHQGDQW $0(1'('$77251(<$)),'$9,72)75(925<281* 67$7(2)7(;$6 &2817<2)'$//$6 %()25( 0( WKH XQGHUVLJQHG 1RWDU\ 3XEOLF RQ WKLV GD\ SHUVRQDOO\ DSSHDUHG 7UHYRU EFINITIONS ........................................................................................................ I l. l . De lined Tcnns .......................... ............................................................................... l 1.2. C::;ngc ........................................................................... ...................................... ...... ~ ARrtCLE II ORGANIZATIO~AL MATTERS ...................................................................... S 2.1. l-'orn1atio11 ................................................................................................................ 5 2.2. Nnnie .......................................................... ............................................................. 5 2.J , Rcgistc:n:d Olfo:e and !\gent: Principal Oniel' ....................... ............... ................. 5 2.-L Tenn ..................... ................................................................................................... 5 2.5. Purposes .......... .... ..................................................................................................... 5 2.6. PO\\'C:rs ............................................................. ....... ....... ...... .................................... 5 2. 7. Co111pany Property ............................... ... ................ ................................................. 5 2.8. Initial Me111bcrs ................................................................... .................................... 6 2.9 Optil>nS LO Acquire /\dditionnl Un it s ...................... ......................................... ........ 6 2.10 Consent o l' Manngcrs ................................................ ............................................... 6 2. l I. Status of Managcr5 and :vkmbcrs .............................................. .................. ........... (l 2. 12. l Jnit Ccrt ilicatcs ........................... ........................................................................... 6 2. 1J. No Stale l.m' Partnership ..................................... ....... ................................ ............ 6 A RTI CLE Ill CAl>ITAL CO'.'ITR llHITIONS; CAPITAL ACCOUNTS .............................. 6 J. I . Initial Capital Contributions ............. .... ........................................................... ........ 6 3.2. t\ddi1ional Capital Cnmrihutinns ........................... ................................................. 6 .1...l . C't11Jl ltt l /\tc.:cr l .01.1r1s ... ... .. . .... . .......... . .... . .............. ................................. ... .. . ... . ... .. ..... . . ...... 7 J.6. Mc111bcr Notes ........ ........................................................................ ..................... .... 7 ARTIC'L f: IV ALLOCATIOi\S AND OISTl~IB llTIOl\S ....................................................... 8 -LI . A llol'at inn of Pro lit or 1.oss ................. ......... ........ ................................................... 8 -L2. Distributions ol' Di stributable Cash ................... -. ........ ........................................... 8 ~.J. \Vithholding .................................................................... ......................................... 8 -l.4. 1.imitatio11 on Distrihutinns .................. .,.... , ............................ ........................ 8 4.5. No Righ t to l>arti tion or Di stributi on<> in Kind ......... ....... ............... ., ................. 9 A1rr1c·1, c;: v l\·lA N;\(; EJ\il EN'I' ................................................................................................... 1) 5.1 . Management and Cont rol of'( ompany nusirn:s:) .................................................... 9 5.2. Dekgation ul' t\u t horit~ ......................................................................................... I 0 5.J. l.i111 itations on l\ lanager t\u thoril) ................................... .................................. ... 10 5.-t. Reliance ....... ................................................................................................... ..... .. I 0 5.5. Co111rc 11sa lin11 and E:xpcn<>CS nr ~vlcmhc rs and t\lanrigcrs ..................................... I 0 5.(1 , ~t irndard s ol' Manager n11d Member ( '011dt11..:1. ........ .... .... .. .... ......... .. .... .. .... .... ... ..... Io Co \I I'\"' i\ c.1a. .: \ H~ '> I OF c ~. "I l I{ 10 '> Lo <: · ~ 11( " L L C I' \(,I. i MR.477 5. 7. Resignal il>n. Rcmo\'a l. and Rcplaccmc111 of Manngcr ...............,... ........... ......... ... l I ARTICLE VI LIABILITY AND 1 1\ DE~l~IFI C ATIO N ....................................................... 13 6. 1. I.imi tation of J. inbi li l) .................................. .. ... .................................................... I J 6.2 . l11dcmn ific nlio11 b) Com pany ................................................,............................... 1J 6.J . Conduct Nill Protected .... ..................................... ..................... ............................ 13 6 .4. 1nsurance .................... ..... ........ .. .............. ........................................................ ...... 1-l 6.5 . Sun·ival ................................... .......... ......... .......... ................................... ........ ...... 1-l ARTICLE VII BOOKS AN D RF.CORDS; REPOl~TS .......................................................... 1-t 7. l. M aintennnce of and i\ Ct.:CSS to Books and Rccords ............... ................................ 14 7.2. Fiscal Yea r. ........................... ....... .. .......... .............................................................. 14 7.3 . Financial a1H.l Opl'rali ng Rqmrls ......... ........................................................... ..... .. 14 7.4. Tax Reports ........................................................................................................... 15 7.5. ·1·ransm ission of Co111munica1 ions ........................................................ ............... .. 15 t\lfl'l(' LE Vlll T AX ;\-lA-rT ERS ............................................................................................. 15 8.1 . Tax Clnssi lication .... ............... ... ..................................................... ....................... 15 8.2. Co1npany Returns ................. ......... ........... ... ............................... ........................... 15 8.3. Ta:-: Elections ........................... ...... ...... .... ....................................... ............ .... ....... 15 8.4. Cnn sistc11t Rcporling ....................... .. ... ..... ......................................................... ... 16 8.5. rax Proccc VOTl~ G OF \'lEMBE RS ................................................. 17 9. 1. lvh:cti ngs ...................................................... ................. ,........................................ 17 9 .~. Voling ................................................................................. ................................ ... 17 ARTICLE X TRANSFER OF MEMBF.RSlllP INTERESTS ............................................... 17 I0. 1. Li mitation o n l'ransfi:rs ...... .............. ....... ................. ...................................... .... ... 17 I0.2. Pcnnitlcd I nlnsl'cr or ~vkrnbcr'>h i p Interest ........................................ ................ .. 18 I0.J. Co ndi tions to Penniltl'd 1·rn11s fl' rs l} I. i'vlcmhcrshi p lntnc..:sts ............................ .. ... I <) I 0.-L 1 ~ ni:c ti' L' Dat\'.': D istrihu li11ns. ................ .............. ...................................... ......... ... I9 I 0.5. 1·rn nsli.:ro1" s Obiigations .. .... ...................... ............... ...... .................................. .. ... 20 I 0 .<>. Assignee ·s Rights and Ob i ig.at ions............ ... ............................... ......................... 20 I 0.7. E rrcct and Cn 11 scquen c1.·~ o l' Pruhibikd T ransfer .. ...... .. ..................... ............... 20 I CUL A gn.:i: menls 01· Spnt1<;l': Snk \ lanagcmcn1 (\111m1uni l: f>r(>pcrl~ ...... .................. 21 1 ARTIC LE XI ,\l>Ml SSIO~ OF NEW \1E\·IB ERS ............................................................... 2 1 11.1 . Subs1i1 utcd l'vkrn bcrs ... ........ .. ........ ....... ................. ... ... ............................... ........... 21 11 .2. Addit io nal ~vk mbcrs .. .......... ......................... .. ....................... ................ ..... ... ...... .. 22 ARTI CLF: XI I \VITI ll>RA WAL OR IH~ MOVAL OF 'IK\tlBERS ..................................... 22 12. 1. \Vi1hd ra\\'al or jvk mbcrs .. ......................... ............................................................. 12 12.2. Rcmowl of" \!!embers ..... ................... ... ... .. ........., .................................................. 23 C o\11• ' ' ' A<.1u .1·: \1t:' 1 01· Cl '11 1uo' l.oc 1-.. 1 t< ' L LC I' \(; I. ii MR.478 12.3. Optional R~demption of Membership I ntc rest .............. ........................................ 24 12.4. St<1Ltts of fo rmer Member .................. .................................................................... 24 ART ICLE XIII WINDING CP AND TERMINATlON ......................................................... 24 13.1 . Evt:nts Requiring Windi11g Up ....................................................................... ....... 24 13.2. Winding Up Procedures ................................................................................... ..... 24 13.3. Continuati on Without Winding Up ....................................................................... 25 13.4. I.iquidation of Assets and /\pplication and Distribution or Pn>c eeds ................... 25 13 .5. Certificate of Termination ..................................................................................... 26 13 .6. Rcinstatc1ncnt .......... .............................................................................................. 26 A lffl(~ LE XIV YA L U.I\l'ION .................................................................................................. 26 14.1. Fair Value of Company Property .......................................................................... 26 14.2. Fair Valt1c of Membership Interest . ................................................................ ...... 27 ARTl CLE XV GENERAL PROVISIO:"IS .............................................................................. 28 1S. l. /\ n1cndn1cnts............................................................................ .............................. 28 15.2. Notice ..............,.................................................. -................. ................................ 28 15.3. Governing Law: Consent to .Jurisdiction ................... ............. .......................... ..... 29 15.4. \Vaiver ............. ............................... ... ....... ............................................................. 29 15.5. Ent ire J\grl!c1ncnt ................................................. ................................................. 29 15.6. Successors and Assigns ...................................... .............. .. ................................... 29 15.7. Third-Panics ................................... ....................................................................... 29 15.8. Sevcrabil ity ................................ ............................................................................ 29 I 5. 9. Cc)nstruc:tion ............................................... ............................................ ......... ...... 29 15. l 0. Execution of' Agn:e1rn:nt.. ........................... ........................................................... 30 I S. 11 . Further 1\ ssuranccs ................................................................................................ 30 I 5. l 2. Pov•er of J\llorney ................................................................................................. 30 EXHIBIT A ME\.1BERS' CONTRIBLITlONS AND PERCENTAGE INTE IH:S-rs ......... 32 l~ XHlBIT B SPOUSAL JOJNOER AND CONSENT ............................................................... l APPENDIX A PRI NCIPLES OF ALLOCATION ............................................................... A-1 .'\. l In troduct ion ........................................................................................................ /\.-1 A.2 Dclinitions ............................................................................................ ............... ;~-\ A.3 Capital 1\ccuunts ......................................................... ...................... .................. A.-4 A.4 J\llocntions of Net Profit and Net Loss ....................................... .. ................... ... /\-) /\ .5 Tax ;\ !locations ............................................................... ................................. ... 1\-8 Ct1'11' .\ ' \ ,.\{:tU.r. '"·'I OF Cl.., l'I Ill()' L,\( ;~: il l 115118 1812! 1220 1-1 MR.479 c o rvlPANY .-\GnEID IE l\T OF CENT t:IUON LOGISTI CS LLC l'11is ngreemc111 (""Agreement"·) is entered into clTcclhc as or September 18. 20 IJ (till' ··Effccti\c Date··). hy lhe persons identilied on the signature pagc(s) hcn:o r. RECITA LS 1\ . 1"11c Company was frmncd pursuant to a Certi ticatt· of Formatint1 tiled wi th the Sctrdmy nf"Stale or thc Stale of Texas cllective ns ol'Scptcmber 16. 2013. B. The pnrtics desire to provide for lhe regu lation and mann~e rn cnt nf the ~1 1Tnirs of the Co1111xrn) nccording to this /\grcemt?tll and the Code. l\0\\'. l l IERl:FORE. the panics agree as fo ll uws: ARTICLE I O t<: FI N ITIO~S I. I . ()dined I\~rms . 1°111..' l~)l l owing defini tions and the tkli11itirrns set fort h 111 ~rn1c1H.fo: 1\ to this 1\grccment. nppl) ll) the lenn~ used in lhis Agreement !'or all purposes. ··Atlt!itional Capital Contribution·· means the sum or cn~h and th1..· Fair Value nr an~ properly rnntributcd 10 the Cumpany \\.i th n.~spcct tn a Mt:mlx:rsllip lntl'rcst as permitted under this !\gn:l'rncnt, hul dm.:s not include an Initin in question. ·· ~\t!.rccmcnt· · means thi> :\gn:c1nc11L ,is it may be rnncndctl. suppkrnentcd or resta ted from lime (t1 time. ·· !\ssiunee·· means a pcrsnu Ill \\ hom a ~kmhcrshi p J 1111..·rcsl has bcL'll trnnsll:rrcd b: a \ ·kmhcr ~ir 1\ssig11cc in a Pcrmiltcd rranskr. or in a Prohibited l'rt1nsfl·r that the Compan: is 1\:quircd h) la\\ lt1 rt'<:t1gni1c. but" ho has not b1..·conw a :Vlc111 l\:r. ··C:api 1al (\1ntribulion .. means lhc st11n or the Initial Ctp ital Contrihutinn and Additional Cnpital Contributions. if an~. wilh n:spct:l tn a ivk111hcrship Interest. E.:\ 1111111 A 11<1 1 ~~1)\\2:! l:!:.' 01 ~ MR.480 ··ce11[1icatt: or Fonnation .. means the ccniticate of formation fikd \\ ith respect to tht' C11111p as provided in Section 2.1. as sw.:h ccrlilicak' may be cnrrcclcd . amended. or rcstntcd. ··certificate or Membersh ip Intcrest'· 111cans a ccni limtc n.: prcscnti ng. each l\•kmbcr' s ~·kmbcrship I ntcrest in a lotm approved b) the Managers. ··code .. means the Tcx11s Brn.;incss Organi1.ntions Cmk. as anwndcd from time ro tinh.'. and any successor law . .. C'llllll?J!.!.l{. mean~ the limitt:r nnt such person has the status required to be an lnd cnmiticd l\:rson al the lime any Prm:ccding is made l1t' m:iintnincd as dc~ nib ed in Aniclc YI or '11 lhc time any amend1rn:nl tn this 1\grccmcnt is prnp<1scd limier Section 15 .1 . .. ltH.!c...: Rutc.. mcans thl· rntc spcc iltl·d in scctinn ~0~.002 of the Tc'\as 1-'innncc ('(1tk E.\ 11 llCI I A I l ~W\ llh 2 .:! I ! ~•II I MR.481 ··Initial Capit . .. Permitted rransli:r'' rnem1s nn y lrnnsl'cr o f a ~kmhcrship Intere st th\11 is describ\.'d 111 Section I0.2. ··ProcceditH.!... rnenns la) n n~ lhrcntcnetl. pending. or Cl1tnpkll'd action or other proceeding. \Yhether ci\ ii. crim inal. ndrninislrati\c. nrbi1rnliYc. l ) r inn:stiguthe: 1h) an appeul or any such proccr:ding: nnd (c) an inquiry or in\'Cstigatitrn that could kad lo any sw:h proceeding. f.~ 11111 11 .\ I i_l'rmilll'd t'ranskr. ··[{cquisitl' l'<.:rccnlal!e·· ll1L' tl Member lo the Compa: lb) rd'crcncc lo ;. 2.7. Compan\' Pro pert\ . (n) :\ll Cnmp:iny prnperl) slrnll bl:' n\\llcd in the ll 1wrnc of an: \1emhl'r. N11 tvlernbcr or 1\ssi~nl.:'e will IHI\\' . Consent or fvlcmbcrs. Faeh p.:rsnn executing this /\grel.'mcnt consents to the admis~ion as members in the Compan) al l t)(' thc Initial Members and all l)thl.'r persons who are Members as or the date sui.;h person t:Xl'.tlltt:S this /\grccmcnt and run her l'.Onsents lo the issuance of nclditional l !nits as provided in Scctilln .2.9. 2. 10. Status of Ma nagers and Members. htept as othcr\\'ise provided by 1his Agreement. lhc Managers haw lhi: status. rights. and nhl igations L'f a manager in a limited liabilil) cornpan) as set forth in the Code. and each Mcmbt:r has thi.: slntus. rights. and obligations ora member in a limited liabi lity t.:mnpnny as set fo rth i11 th1.: Code. 2. \ I. l Jn it Cqtilicalcs. l·:ach :Vkmber' :s Units mny be rqm:scntctl by a \ Inil CertiliL:atc. 11· Unit Ccrtilicatcs nrc issued. cn~h llnit (\·nilicatc shnl l bi: numbl.!rcd and registered in 1he r1.'l'.Ords of the C't1mpn11y ns th1.·y arc issued. and signed by any or the Managers. I hc holder nf ttll) Unit CerLi lieak shall prnmpll) noti(' the Company ur any loss or destruction t)!' th.: ccrtificak. and the rvlnnagcrs shal l cause a replacement L:erl ificnte Lo be issu1.·d to thl.! holder upon or recei pt nl· sali sl!1ctory t:\'itlcn<.:c the loss. de.st ruction . or mu1ilation nr the cerli llcntc and satisfodion of other l'l'. llS()llilble 1.:nnditions. 1.12. f\o Stntc La\\' Partnership. l'he l\tkmbcrs intend that the Compnn) is not a p<1rtnc.:rship or joint n~nture. nnd that no ~vlanngl.'r nr Member is a partner or a joinl ,·entut·L•r tll an; nther \lnnngcr nr Member for any pmpo:,,cs other thun income la\ purposes. 1'\n prm·ision orihis 1\gri:1.:rnl.'nt tnJo ivkrnlK·r has the right or is pcrmiltt:d lo 111nkc Addi til>lll'n:l'nlage Imcrcsts. 3.3 . Capital Accounts. Thl' Company sha ll establish a separale C1pitnl 1\ccOlllH for l.'ach Jlvkmber and 1\ssig.11cl'. rill' Capital /\ccounts shall be nrnintaincd accordi ng to 1hc or pro\'isions Appendix t\. 3.-L No Right lo Rl'turn or or Interest on Cnpital Account. Nn Membn may demand or rccci,·c the n:turn r'11' its Capital Contributinn or any portinn or i1s Capi1nl /\e<:tH1nl. except as prm ided in thi s Agret•ment and thl' Code. The ~vlanagcrs do not ha,·e any personal liability 11.w lhc repayment of any Cupital Contributions or any tvkmbcr. No intcrcst \\·ill accrue or be paid "ith n.:sp~<:t LO thc Capit111b-:r >J~HL' S tlm1ug.h thl! end nr 2()0\J. it i:- inti:ndeu that su<:h net 1<1.xuhk income ''ill be nl lllcated to the tvkmber ~oles holders tn the cxlcnt tit' an) a1.:cn1L·d interest nr original issue discount nn the r1vlc111bt'r !\oles. and ii' ther~ is a net taxnblc loss !or :;ueh pcriml. it is i 11L1.:m_k d thnt such net ur\:abk loss "i 11 be al located lirst to lhl' f\.Jcmbcrs [() the l'Xll.'lll or th\.·i r l'apital Cont ributions and lhc11 ln till' holders nr the!\ kmbcr l\otcs. C0\11'"' A<;RH\fl''\l Ill Cl '\II lllO'\ 1.oc1-.11<~l.l.C E.\111111 I ,\ I l 511!; l X\ 2 2 11 ~I ll~ MR.486 ARTICLE IV Al.l.OCATIO~S A:' IHST RIB l!TlO NS 4.1 . /~lloc:u i on or Prnlit or I . us~. Subjett to Section 3.6. Co111p;111y prolits and lossc!:> ~hnll he nllocatcd among thi: Members nnd Assignees in accordanl.'.e \\ ith the 1wo' isions ot' QPJJt:ndix 1\ m as is dr tcnnint.?d by the Managt:rs. lhe 1vkmbers an: ~l\\'\11'1.'. of the income tax consequences nf the nl IOCll d1..·mand or. at the dl't:tinn l )I' the lVh111agL·r~. is n:pa~ nhlc nut 01· distribut ions tu" llich sud1 i'v krn ber tH' 1\ ssignl'L' would uthen\ isc he 1.•. ntit lcd . . 1..i. I.imitmion 011 Distributions. (a) I he Compan) mn~ nnt make u distributinn tn n ~kmber m Assignee if it \\'Oulu remkr lhl! Cnmpany i nsnlvcnt. ddl'rnl inl'd in accor lo the nssc1s ti!' thl' Com pan~ for ;111~ distributions. inch1d i ng liqu idating distributions. If the assets nt' the Com pan) remaini ng. alkr the paymen t or E\ llllll I ·\ I I ~llS I!\\ ~ 1 12 201 I MR.487 di:-;clrnrge. lll" the pmvisilln for payme11l or di~thargL'. or the Co mpan~ lia bili ti es arc insulfo.:icnl Ltl mal..c any distributinns. no \ikmbcr has any recourse against the sqmrate assets or rn1) other Member. -LS. >fo lfo~ht to Partition or Distrihu1ions in Kind. Nn Mcmbcr has any right. and \\'ain.·s m1y right that it might ()therwise lul\·t'. 10 cause all) Cmnpany properly to be partitioned at1d/or distributL'd in kind. h;cept <1s provided in Section IJ.~(d) (relating tn liquidnting distributions). the Compnny may not make an) distributions in ki nd. ARTICLE V MANAGEME~T 5.1. i•vlana~!nent and Conlrnl orCompnnv 13usin-:ss. (H) Sub_icct to the limitations set forth in this /\grccmcnt. the Manag.crs ha\'c e:-:cl usin: authority to manngl' :i11d conduet the Com pan)· s business. The \!-tanagers shal l do all things appropriate to cnrry oul the (\rn1pa11y's purpose. I :xccpl as othern isc provided in this t\g.recment. all net ions that the i\ lanager:-; may tnke nnd all dctcrmi nations that the Munngcrs 111ay 1 make pursuan t to this Agreement may be taken and mat.Ir..: in LllL· absolute discretion of' till' i'vltmag.crs. (b) I he initial Manngcrs of the Comp;111y are: .John Calcc. Antonio Albanese. nnd ~-tare Mmrocco. I :m:h \!tanager \\·i II SL'n·e as a Manager u11ti I his su<.:cc:;sor is nppni lllcd pursuant [() Set:tiun 5. 7(1}. (c) The ~vkmb~..'rs muy not htke part i11 1he mr11wgl'nient ur control of the Company businL'Ss or bind the Compnn) in lhl'ir cnpnC'i1y ns rvlcmbers. i\ ivkmber may hn\'e the stnllls of a J'vlanag.cr ~ir g.twcrning person nr n M;magcr or the ( 'umpany and may possess and c.xcrci sL' the powers :rnd au thority assrn.: ia1cd wit h such status. (llJ Meetings or the ~'t anagers ~hnll he held li·()l11 time to Lillle as determined b) the \.htnages . .\fonagers nHt~ participate in any mcl'ling. b~ means of video or audio conf'erem:ing. or ~i111ilar com111unil.'.alio11s equipment\\ hereby ull \\ h111agcrs cnn hear ench other. No notice ot'<111> meeting. \>r the l'vlnnagcrs is required Lo be g.i\ en. At nil meetings ol' Managers. the 1m:sencc of a 1uzjuri1:i t,r thi:: ~11aµcrs shal I be nccl'.ss11S,IS12 2 12 lill~ MR.488 \\riling. sdting. fort h the ac tion so taken. slw ll bl' signed by ~la n agcrs ha,·ing not l'ewc:r than 1111..· minimum number or' oles req uired w approrc such ac ti on under the CodL'. the Ccni lkatL' nr thi s Agreement. J\ 1:1csim i h: or si 111 ilar reprnduction of a writing si gncd by a :Vlr1nagcr. shn ll lK' regarded as signed b) the :vlanag.ers for purpnsl!s of this Section 5. I(e ). 5..2. Dclc12.ation or /\uthorit). (a) rhe Manager:-; may cat1SL' the Company to hire employees and agents. rwd may dclcgati: tu such pi:rs{)llS any or its authority hereunder. as the Mmwgers deems a p proprb t~ for the conduct of the Company's business. ( h) The IVlarn1gcrs may appoi nt officers or the Cornpnn) as the ~ l nnagcrs dcc1n appropriate. The ol'tiecrs lllil) be <)ppoi nti:d for such terms and may cxcrcisi: such pt)\\crs and authority and perform such duties as ckterm incd hy the ~vl anai;ers. 1\n olfo:er need not be u Mi:mb~r or the Company. /\ ny two or mon.: nlfa:L'S may he held by tht: snm~ persnn. Any llfficcr ckcterl h in this /\grecme11t. L::wt") document 1:xecuted by a Manager \\ ilh respt:l'.I to an) busi ness or property of the Compnny i ~ co11cltl':;i\'c c,·idencc in litrnr of any jWrson n..:lying Oil the dOC lllllCnt that (Cl) nt the time or the l''.\'.l'Clltion and delivery of the document th is 1\grcl'll1L'nt " ·ns e!Tecti,c. (h) the dm:urnrnt was c"ccuteJ in accnrdarn:L' \\ith this /\grccmi:nl and is binding upon the Company. and (c) the \.1anagcr was authnri1:1.'d to ('XC'Cll l C and dcli,·cr th\.' docu1111:·nt on behalr or lht' Cumpany. SA. Compcnsr judiL'ial authority or contained in any 11.':dcral or slate statute. (d) Status ot' Forl)lcr ManalJ,£[. /\. :vtanager \\ho h~1s resig,ned in vio lation tlr th b /\grcernenl or \\'ho has been remo\'l.:t.I has the ::->talus or an /\ssignec \\ilh respect 10 un~ \1kmbership Interest hcltl by the forme r Manager. tL') lnh.:rim Munagcmcnt. During the period lhal th1: i\tk:mbcrs may l'kcl ~1 rcplncl'mcnt :Vlanngcr ns provided in Section 5. 7( 0 uml prior 10 sucli election (or nn elec tion 10 "ind up the Company). the Members may by \'Ole of' a Requisite Percentage appoint an Interi m manager ha\ ing authority lo manage and condud thl' Company's business as the Managt.:r as pnH'idcd hl' rcin. Ir an interim Manager is t)ol appoinkd. thL' aulhorit~ tn nrnnagL' and conduct tlw Company's business is vested in the Members who may t1d b~ ' 'ole or n Requisite Pert.:L'ntagc. n11d who may by vole or a Requisite Pcrcentngc appoint a t.:omm itkc o f' 1mL' (W nwrc per.sop<; ltl l'\crl· isl' the authority of the Manager until such time ;is u repl ncement Manager is ckl'tcd or the Company eommL'nccs winding up. The l\lc111her.s ~hnll lilc any requ in;d :t11Jl'l1dll1l' ll ls tn this /\grecnll'nl or the Ct:rtilicatt' of' Formation Lo reflect the rcsignution <'r renHn·al <)r the fnn11cr lVla11agcr and the appointml'lll or the interim IVln11•1gcr or the con,Trsiu11 of the Cumpun~ 1~1 a 111embcr-nrnnnged limited liability company. !\nd all f'vkmber~ appwve an;. such a111L'11d111L'nb. ( f) l'.lcct1011 of Rcplac:emclll ManagL'I'. 11 a i\,latwger dies. is disnblctl. rcsig11.. or is rL'l110' cd as the nianagcr of the Company. \\ ithin <)Q da~ s llilki'' ing sut.:h denlh. disablement. resignqui:-;ite Pt:reentngc ma) elect n reph1L'l'11H!l1t :vt.mager or the: C11mpa11y elTecliH· ns nrtht' date oflhc.: runner ivla1 wgc1" .s denlh. di sablement. rcsignalitm. \\I' l\!llH)\·al , The i\ fan•tgl'r'i sha 11 l'ik llll) n:quired nmendrncnts to thi s :\grl'ement to rdlcct the death. disabkmcnt. l'Csi~1la l ion . or n:muvnl or the former Nhtnagt.:r nnd the dcctioq or the n:place111c111 \Tanager. Cm11• ' ' ' M ;t1 1T \lt:\ 1 Ol C't.' 11 Hiii' t.01.1.., 11cs LLC f: .\ 111111 I ,\ 11 '0~~1'1 ~ 1 12 211 11 MR.491 A RTI CLE V I UADILIT\' A~ D I N l)l~ MNIF I CAT I O~ 6. 1. Limitali()!l of _lillbiliLY· Nl) Member or Manager is liab le fL)r an) debts . Llbligations. or liabilities or the Company. Subje1:t to Section 6.3. an lndl'mn ilicd Person is not liahll' tc1 the Cn111pany lll' nny other lndcnrnilkd l'nson for an) L>anwges arisi ng fro m any Proi.:ccdi ng relating to the conduct or the Compnny·s business nr rdating In an) ad or omi ssion b) the lndemnili1:·d f\:rson '"ithin the scnpc or the lndcmnili1:d Person·s authority in the courst! or the C'ompan) ·s business. including any breach or any liduclnry duties. or for any misconduct or neg ligence on the part or any other person who is an employee or agent or the Company. 6.1. I11dc111ni ti cation bv Com pall\ . lo the fu Ilcst exknt pcl'll1ittcd by app licabk law. and subject to Scditm 6.J. the Cnmpuny indcmnilies and hold!'> harmless each lndcmnilicd Person fh)ln and against any Damages arising from any Proceeding relat ing to the conduct of the Company's business or to any act or omission by such lndcninilicd Pnsrn1 within the scope or the lndcmni lic.: la\\ . (b) \Jo prO\ isil)n orthis Agn.:cn11.:n t rl'qu in:\ the Compan~ to p amount l'n r ''hi ch indemniti1.:atinn is not pcnni\lcd uru.kr thi s ,1\rtick VI. (c) i\ny pny1rn.:11t:> made I<.) or on hdialr or a pl.'r.son \\ho is Inter determined not In be i:ntitkcl to such payments shnll be repaid by the perslm to the Cnmpany. ·1he Corn1x 111y ma:- Ex 111111 I ,\ li'IJ~llh : ' I.' 'Ill I MR.492 1\~qui rc. ns n condition lo lh(' paymem nr an) amounls pmsuant to Section 6.2. that lh1.· lndl'.mnilicd l\:rso n prmitlc to the Company {i) a \Hillen ani nnalion by the lndcmnilicd Person ( 1r the pcrson·s good fai th bdief lhal lhe person has met lhe standard or cnndUCl 111.!CCSSary for indcm11ilic<11ion under this Sec ti on 6.J: nnd (ii) a \\l'ittcn undertaking. b;. or on bd 1~1 1r or the lmkinnilied Person to rc:pa) the <1111ou11t paid or n.:imbursed if the pi.?rson has not met that slll mlnrd or if imkmnilica tinn is 01hcr\\ise prnhibiled b} la\\ , 6.-L Insurance. The Company may mnintnin insurance lo prntecl any person ngain~l any ex pense, liabi li ty. or loss. ,,.hl.!thcr or not the Cornp;my would ha' c the pl)\\'CI' ll) indcnmit\· such pe-rson against such expense. liability. or loss under the Code. 6.5. Su1Yival. The imkm ni tics proYidcd for in this J\gn:~t·tll c n l Slll'\'i\c the lt"anslcr or an lmknrnilied Person's Mi.:lllDL'rship lnlcn:st. the krmi11t11iu11 or the pcrson·s SlCM. lhc i•vl nnagcrs slw ll deli\'i.:r lo cnch tvkmbcr an anm1<1 l report rnlllaining. 1hc folio\\ i11g : {il) " hnla11t:1.' :-.heel HS nr the ..:nd or !>llch lisi:al y..:m. and Compr fedl.'rnl income lax purposes. 8.2. Ct>mpam· Returns. lh: Managers shall cause the Company to ri le such tax 1·c1mm; as Jnll) he required by la\\'. 8.3. rax L:b:l ion s. (a) General. b:ccp( as 1H hcr'sisc prm ided in tlfr.; ,\ gr('e111L'11L the ~vlanag.ers shal I ci1use the (\1mpiH1). to 1i111dy nrnkc or revoke all elc:l'lions. and lake all tux r1.·purting positions. nccessar~ or Lksirahlc ltH' thc Cornpnny and lo mnxi111i z1.: the ta~ lK1 ne i'i1:-; lo th\.' \ilcmbers. \lo l'leclio n shall bl..' maJ1.· Ill lwvc the Compnn~ l.''\Cludcd from llh.' applil'ntinn or nn: pro\'isinll nr Subchnpt1.'I' Kot' thl.' I.R.C. or any equi,alcnt lax pro\'isio11 in <111~ nthi.>r Ln:-. jurisdicti1 1n. (bl Section 754 F.lcct ion. ·1he Compan) shall make lhl' 1.·kctil>ll n:krrt:d to in l. R.C. S1.'CLinn 754 upon the rl.'quesl ot' ~m y \ 1L'mbl'r in connection \\ ith II tr:111-;f\:r nr the :-Vkmb~r" s 1 1'·k111IK'l'~hip I11tcr1.·st. (l:l Sa lC: I l<1rhor Elec1io11 for CompcnsaLun· ;\.·lcn1bership In terests. If Proposed rrcm;ur~ Rc g. ul~1li t>11 1.83-J( I) is rtdoptcd :is rt tc rnpo rn r~ or litl\11 rq;ubtinn. the Compnny shnll nrnkt' the -;ali..· hnrbor l'!cc tion described in such n:gulatit)llS. nnd llw ( 'umpuny aml cuch Member F.'\111 11 11 A ll 5l l81~\22 1 2 ·~01~ MR.494 (including any pcrson to whorn an int crest in the Cc1111pn11y is transtcrrcd in cunnettinn with the p1.:rfnrn1~11H.:c nf' services) shall cnmpl) with all n:quin.~mcnts o!'tht· sale harbor\\ ith rcspcct lo all t\kmbl.'rship lnll'resls lransfcrrcd in connection \\ ith the pcrfonmlllCC oi' SL'rVices \\'hiic the l'll'dion r..:mains effecti' c. The Mam1gcrs shn ll prepnre. c~..:cute. and Ille any 1·cquirc.:d dm:uml..'ntation to cause 1hc L'kction lLl be cffecti,·e. The Ma11ag1.:rs ma) termlmw.: the sa le hmbor cll'ction at :rny timl' if it determines in g.nnd foi1h 1ha1 it is in the bi.?sl interests of the Compan) nnd the i'vlcmbcrs to do so. 8.4. Consistent Reporting. r:nch Member sh11ll. on the Member's tax returns. treat l.'ach parllwrship item (as detined in I.R.C. Section 62J l(a)( ))) in u manner consistent ''ilh the 1rc.:a1111cn1 or th~ item on the Comp::iny·s return in all n:spccts. including the nmmtnt. timing. and t:harncler ur the ill'111. No Mcml1l'r sha ll lilt: a reqUl'St for 11 11 rn.lministrali\'l' adjustment or partnership items untkr l.ltC'. Section 6227(a) ii' such request \\t>uld 1:nus<: the :Vkmbc1-'s or ll'C:ltmenl ol' the item h1 bl.' inconsisll.'11[ with the lrentrnent the ilt:m on thL' Comp;iny" s return. (d It) be pmpa11: nnd l'L'lllnst' llts in lk u ora mce1 ing. shal l be in t'o nfonnil~ with Chapters 6 anti I 0 l ( 11) of the ( 'ndc. St:cl ions I 01 ..15.1 through I 01 ..156 nf the Code {relating tn quorum and mininwm rnling rcq uirc1111.~nls) sha ll not apply to the cxtt.:>nt such pro' isions an.: inconsistent "ith this Agrccmcnt. Thl' Managers ill\.• sole!) responsible for co1l\'e11ing and conducting meetings llf the \1cmbet's. COl1(1Ucting the solic itation or consents. determining the rnlitlity and cffci.:t or responses to any sol icitation or const:nts. and determining 01hcr malll:rs regarding medi ngs. \ nting. anti rnnscl\l s. (d) Notice or the results or an) rntc taken at a inccting. nr lhl.' results nr H11) sol icilaliu n or consents in lieu of11 meeting:. shall be gi,·en lo the.: Member:> IHlt IHtcr than" ith thi.: ddi\'l'I')' orthi.: next l'nllowi ng l\' pon or lina nl' ial infonnnti1rn g.i,·e11 pursuant lo Section 7.3 . 9.2. Votim!. ;\ ivlembi.:r m;1~ vnk al fi:-r of a i'vlcrnbt-rship or ln\l:reSl. fllCtlllS tlll llSsiglHHL'lll (\\hl'\ ll1.'1' \'Olt111la!•il) . illYOlll11ltll'ily, OJ' b) opcralic.)ll ltn\ alld f.\ 111 1111 .. \ 11 3 11/Wh ~ ~ 12..' tu "ithhold approval for th(' transli.:r nf a l\k1nbership Interest. a trnnsfor shul I nnt hL' a Perm illed Trnn:::fc:r unless the ivlnnn!.!.crs dd~nn inc thnl al I or the follm\ inu ~ ~ torn.l itions <11\: snti :•ilied ~ (a) The trnnster co mpli es" ith all appl icabk hl\\s. including uny npplicabk sccuritks (b) ·1he trans ler \\'il l not cause thL' Com pan) to l1L· iri:ated as t~thcr than a partnershi p t(1r l.:nitL'd States fl'dernl income tax purposes. (c J l he trnnstcr wlll not cause the Company to be ~ubjcct to rcgulatio11 under the lnwstmcnt Company Act of 19-W. as amended. (d) The transfer \\"ill not cause any nssets or the ('ompan) ttl bt: deemed "plan assets" umkr the 1·.rnployee Retin.:mcnt 1ncomc Scrnrit) /\cl or 1974. (e) rhc trnnster will not resul t in a termination of the Ctimpany under l.!U..'. Sce tion 708. unless the iVlanagL'rs detL'rminc that s uth li:nninnlion \\ ill 1101 ha\'e an nd\'CrSc im pact on till· Members. (n !"he lrL'.l'lllllll"d Trans li:r orn i'vkmbcrship lntt:rl..'Sl l:- l: ffl'l.Cli \I..' ltS tl r the ll1·s1 da) or lh L' 1:. ("I I\ 11' \ "\ \ ,\ (.Ill I . \11. "\ I cH·rally linhk to the Company for. and shall i11de11111il~ and hold th.: Company lwnnkss ugainsl. an~ expense. liabilit). or loss incurred b) the Computt) (i ncluding rcasonablc leg.al lees and cx111.·. nscs) as a resull or suc h tramJer. thL'ir n.'lllll\·nl w1d liquidatilHl or their ~kmbershi p lnll'rcst~ (irnpplicablc ). and t h~ efforts tn enfon.:e 1111.' intlemnit~· granted in this Serti on 10.7(c). (° 0'11'\'\\ ,\ C.IHl. \11 '\t 01 Ct·.\ll lllO'\ LOGl'\l l('i I.LC E\111111 I .-\ ~ 12 ~ 11t J I l ~11:-C~K1.! MR.499 10.8. Al!.rCClllClllS or Sgouse: Sok i\fan~H!Cnt Clll Cnm1nun i1\' Propcrl\. (a) 1-:xcculinn nr Spousal Jo indcr and Co1Jsenl. The spouse lll" each \.kmbcr shall cxeculc and deli,·cr l<'l 1hc Company a Spousnl .loinder nnd Consent in the form or Ex hibit B. (b l 1\!.!.reemcnls or Spouse, I he spous1.· of' each :'vkmba ngn.:es that : (i) this /\greemcnl is entirdy fair. just and equitabk and in his or her hes! interest: (ii)the co\·ernmts made in this 1\grccml'llt nrc binding nn such spouse iml i ,· if the death or such spouse. lll1) l11ll.'l'\.'::il such Spouse Illa) IHt\'C no'' nr hcreartcr in an: :vkmbcrship Interest \\hid1 constillltcs co11Hnu11il) proper!) should pass to suc h Mt:mbc r and. nccurdingly. such spouse shall ''ill nnd bequeath such Spl)Usc's entirl..' conu11t1nity property interest. ir any. in sueh f\.kmhcrsh ip lnten.:sl Lo suth f'vkmbcr. (d Sole Mn11ng,e111c111 C'~!mmunit,· J>rt~p ert\'. Each f'vlcmb1.:r \\htl is a natural pl."r~un .111d his or her spouse agn:l' thnl such tvkmher' s tvlembcrshi p I nlerl'sl. whether present ly O\\ ncd or hcr('aftcr ncquircd. is. if sw.: h l'vkmbt:rship l11ll:rest is commllllit: proper!). co1111nu11lt:- prnpcrty Sll h_icct ln the sok ll1itnt1ge111c:n l. Cl lll t rt) I. and di spnsi I inn or such :--. tcm her. ARTICLE XI ,\l> i\ llSSIO~ OF '.' il':W \JE:\-tlff RS I I. I. Substi llltcd ivkmbl'rs. 1\11 t\ss ign1.·1: o!' a :vkmbcrshi p l ntl.'rcst shall he admitted a:; ti Suhstillltcd Member \\ith re spccl to :-.uch Mc:1nhcrship ln ter~!'il t in lhl' date on \\hich al l ol" the lo ll l)\\ ing conditions .ire satis licd: (a) I hl' ~v l:rn age rs h:i\ (' upp1·0 \·ed in writing thL' admission or the Sub:-;Lilllll'd l\kmbcr. (b ) I he :\ ss i!:,'lll'C has tkli,·crcd to the Coinpan> any ag1\.'e111cnls and other tloeum1.·n1s thnt the \.fnnag.ers rcqu1.:sl to con li rm su1.eh :\ ss ignce ns a ~ lt:mbl' r in lhc Crnnpan> a11d such Assignct.' · s agreement to be bound hy this :\grecmcnl as a :vtemher. Crn11• \ \ \ A<:1u:n11.' 1 01 Ct.\ 1 l rtlO\ Loc.1.., 11<" LLC E\1111111 ..\ 1l it))(l)t12 .! ll ~til I MR.500 (c) Ir requested b~ 1hc :vtanngers. th~ Company has ren'.i\t'.U an admission foe in an dctem1incd b~ lh1: \tanagers tn be st1lfo:iL'l1l to reimburse the C:nmpany for the estimali:J alllL)lllll e~penscs like!:- 10 be inett1TL'd b~ the Company in con11cc1in11 1~i1h the admission of the 1\ssigncc ns a St1bsti1utcd Member. I 1.2. ,\dditiunnl ivkmbcrs. (a) In Gem:m!. Tht" Managers may cause the Compnn) to ndmit a person as an 1\ddiliona l tvkmbcr and issue /\dditionn l Lin its ln such Additional ~kmbcr upon satisfoct ion of all or the follo\\'ing conditions. ( i) l{cquisi te Percentage has npprowd the admission of the Additiona l 1\ rvk111 ber •Iller 1wtkclO all Members ol' (i) !he Initial Capital Contribution lo be inadL· by the proposed /\ddilional ivkrnber. (i i) the cfl'ecl or the: admission OJI tach Partncr's f>L•rccntage Interest. and (iii) other material information relc,·nnt to the proposed mlmission. (ii) The admission ol' !he proposed Additional :Vkmhcr satisfies the upp licablc t:0nd itit111s or ~1.'CliQ!l \1}.J. (iii) propos<.:d Additional Member lws dcli\·erc.:d tu the Compan) any 1'111..' agn:cml.'nls and othl.'r docl1111cnts tha t the Managl.'rs n:quL'st lo conlinn the person as a Member in th1.' Company and the pcrson·s agreement lo he bound hy thi~ :\grccmenl m; a \ikmb1.·r. ARTICL E XII WITllDl~ AWA L OR REM OVA L OF .\ H:MHERS 12.1 . Wi1hdrawal or\ !embers. ta) No l\k111ber ma) withdra\\ from lhe Company or otherwi se <.:l.' rming the tvkmbcr" s duties und<.:r thi s Agreement: or (i\) ii' th-.· Member is an 1.'nlily. rm C\'cnt requiring the :'vk111bcr·s \Yinding. up or <:~n1:sing the lcrminntion of the :'vkmbcr's cxistcm:L' or suspension of the ivlcmber's right lo Jo husi ncss. (c) If a i\1kmbcr ceases to be a Member in 'iolation nf St:<.:linn 12. I(!!}. tht: Comp:tn} llHI) reCO\ l'r dnmages fro Ill the former \tkmbcr ft)I' brl'nch or thi:-. l\grl'CJnCtll . 12.2. Removal o f Member~ . (al 1\ rvkmhcr may bt· n:mo vcd as a tvlcmhi.:r by thL· unanimous" rilll!n cons~nt or the Manag~rs u1Klcr the lt)llowing circumstant:cs: (i) the l'vkmbcr has 1n111::;tcrred or attcmptt'd to 1n111slcr nll or riny portil>n or its \kmbcrship Interest i11 a Prohibited Transl~r: (ii) in the case or any :vkmber ''lw is also a Manager or nn Affiliate l>I' a ~·tanager. Lht Member or its /\niliate has ceased to be n Manager in ,·iolation or ~et:tion ~_liill or has been rcmnvcd as a Manager in nceonlnn<:c '' ith SL'clinn 5.7(b): (iii) the ivlanagi.:rs determine. in their sok discrl'lion. that it is in the best interest ol' the Company tl1 remove a Memhcr: ( i \) the Member has materiall y bri.:achcd the ti.:rm::; lli° this Agreement or an~ 1>1hcr 111a11:rial agri.:cme111 "ith the Cnmpany: m ( ,.) the \ili111agcrs determine lhe lo remm·l' :1 Member pursuant to lh i:-i Si.:c lion 12.2. thi.: l\h111agers shnll not ii)· thi.: Member in "riling l)r till' prop1 1 s~d remm iii. and if applicable sha ll pnn itk such :vkmbt•r [\ r-.'nsonablc oppununil~ 10 cure the l.'\'l'lll g.i,·i11g ri.se to n:mo\'al. ·1he rcnw,·al nl. thi.: Memb~r is effcclin~ al such timl.' as tktennincd b) till' \Tanagl.'rs in ac1.:orda11ce with applicable In\\· and taking intL) nccount th1.: l\,kmbi:r"s oppt>rtun it) to curl: the e\·i.:111 gi' ing l'iSl' ll) l"l'l\ll)\'HI. ('()\II'\" AC It LI. \II.' I m Ct' I l IUO' l.rn;i.., 11< s LI .c E,.\1111111 1\ 11511l¢ l X,].' 1~ 21111 MR.502 12.3. Optional Ren I 0.4. l ~ :'\ccpt as othern·ise required by the l.R.C.. mnounts paid in redemption of an i\ ssigncc"s Membership Interest shall bL' trcatcd as made in exdrnngt: ror the interest or the Assignee in Company property pursuant to 1.R.C. Section 736( b)( I) . including the inte rest nr such /\ssig.nee in Company goodwill. 12.4. Status or Former Memb~[. i\ :Vkmbcr \\ho withdnt\\!" or has Lwcn relllO\'Cd rrolll the Company or othcrn ise ccnses to be a rvkrnbcr has the statt1:> or un t\ssignL'l' \\ ilh rcspctt lo any Mcn1bcrship Interest held by such rorrner Member. 1:xccpt ns pro,·ided i11 Section 12.3 (relati ng, to optional redemption of a tvkmhc1.. s Membersh ip Interest) or Arlick XIII (relating to windi ng up und termination), such lc1rmer \kmbcr is not entitled ll> n.~cci\·e any payments umkr Scction IOl.205ofthcCodc. ARTICLE XIII WINUll\G liP A:'-11> TERMINATION 13 . 1. l~ ,·e.nts Rcl1Uiri111.! Windin!.! Un. The Cornpnn) "hull commence '' inding. up pn1cedurcs in accortln11cc "ith this J\grl'cmcnl and Lhc Codl' upon the tirsl to occur of any or the follo " ·ing c\'ctHs: (a) a Requisite Percen tage vok Lo wind up and terminate the Company: (h) a decree by a mun requiring. the\\ imling. up nr the Crnnp•rny: (l'l the tc rminalill11of111embcr~hip ol' lhl' last t\'111aini11g tvkmbcr: or (d) the resignati on or rcmma l 1.i 1· ull Managers ir the ~k1n lw rs foil to 1.: kct a replat.:emcnl Managt:r as pro\· id~d in Sectio11 5.7(1} I J.2. \Vindtng_\Jp Procedures. (a) On the occurrence or llll C\"C!ll requiring\\ ind i n ~ up or the Company. unless there is ;111 nction lo continue the Cn111pan: \\'ithnul '' inding. up in :icrnrdanct.: \\'ith SC'cti on 13.3. the \tanagers (nr other l.iquidator as p1\1 \ idcd belo'' l shnll. ns soo11 as rcas\lnably practicable. '' ind up the Company· s business nnd ulfoirs (includi ng. d isposing nr thl'. Cnmpan:-" s asscb shall cease to cnrr: on its business (C'Xci.'pt to the e.'\ tctH neccssar: to \\ind up its bu:-.inc.ss). l'Olkct and sell its property to the cx tl'nl 1111.·. C0\11' \ '\ \ ..$;ltn. \llSI OF Ct\ I l 1111>\ U1c;1:-.11< ... I.LC . Lx1111111 ,\ It rty is not tn he tnrnsfl'ITL'd or distributed in kind. and perforn1 nn) uthcr act required to \\'ind up its husilll'SS and affairs. (b) Ir thl.! Mnnagers han~ "rnngrully caused tht> \\'inding up or the Cnrnpan) or ir there is no Mun<1ger. (i) u Requisite Percentage may rnte Lt' elect a person or persons l$ accomplish the \\'inding up or the Company. or (ii) if the ~kmbcrs rail to elect a pcr:-;011 tl1 accomplish winding up the Cnmpany. then any f\lkmbL'r or 1\ ~s ignee may petition a court to '' inn l 1.054 l)r th~ Code. The pcn;nn or persons \\'inding up the Company. ''hdher the Manager!' or Jn dci.:tcd or court appointed person or persons. is referred to in this Agreement as the .. I .iquidator:· (c} The Liquidator mny determine the time. manner, and terms or or Company prnpt:rly pursun nt to such \\inmpany as dcscri bt:d 111 Sedion 13. l(a). the Company may be cunlinucJ as pnn idcd in Section I 0 1.552 nf the Cndc. {bl Ir there is n tl·nni11atio11 or the continued mc1nbership ui' tltl..' bst rcnmining 'vlt:mber as desnibcd in Section IJ. I (t: !. then prior to t()111pktion or the '' imling. up protess but not later than 90 days nlkr lhl' t:\\'nt of termination. the \tlnnagcr~ nm) continue thl..' Compun~ hy admi tting one or mun: \lc111hcrs dli:1..:ti\ '-'as ur the occurn.:nt:\' nflhe l~ \ ·cnt or lerrninat inn. •\n> 1\ssignct: \\·host..' i>lTL'l't1lllg_C Jntl..'rt:Sl \\otdd be diminished hy rl..'aSt\ll or lht: admiSSlUl1 \)j' t\ 11 ;\ddit il1na I Member under the l'ircumstancL's d.:snihed in th is Section 13 ..l( b) must apprm e the nd111issil11l or the /\ddit innal f\·11.'nlbl' I'. ! .1.-1 . Liquidution u!' ,.\ssds anti :\pplicaliun and l>istributio11 or Prnct:t:ds. (n) In Ciencral. On \\inding up the Compnny. the Liquidntnr shall dispos1: or th1.: Compnny·s propcrtii;:s nnd \1ppl) and distribute the pnKet:ds. or transler th1: Co111pn11y properties. in the fol lowing tmkr or pril>rit): E\lllHll" 11511.1( IX\.! 2 I.! 2111 I MR.504 (i) to creditors (including ~!embers who an: creditms) i11 uc1:orda1K·c \\ilh their relmiH~ rights anti prioritil:'s to satisfy the.: liabilities o l' the Cnmpnny. including expenses assm: iuted wi th tht: winding up and termination or the Company. hul excluding nny Compan> liability ror :my unpaid \~a11dnlllry Distrihutiuns: (ii) i\lkmb1:rs. Assignees. and former :Vkmbcr:-; to satis f) the Compan) ·~ tti liab ility for any unpaid ivlnndutory Di stributions: and (iii) ln I\ kmbcrs and Assignees as provided in Section -L ~. (b) t\o :vkmbcr Dctlcil Reslnration Obligation. No ivkmlK'r is liable I L) the C nmp;)n~. Lo another iVkmber. 01· to a third party. for the n:pay1m.' nt ur any deficit in the \ !ember's Capital /\tcotmt, extcpt as provided in Section I 0 1.206 of the C'ndC". (c ) Reserves. In the discrt'lion or the Liquidator. .-± shall bL· treated as made in exchange for the inll'rt·~t of the \tlembcr in Company pn1pert) rursuant tn l.ftC. Sec tion or 7.>6(b)( I). includ ing. the interest such :Vkmbl'r in Com pany g.ood\\ ill. U.5. (.\:nilicalc or Ti:rmin:itinn. l'hi..: l.il1Uidator shal l lilc a Ci.:rti liL'iJk or Term inati on oru Domestic Ent it: on the completion nf the winding up o f tlh~ Com pan:. U. <1. Ri.:i nstah:menl. Ir the l"l>mpnn~ is tcrrni11aled. It nm~ be rL· in;;;tn tcd in the m 1111111.· r pnn' idl..'d in the Ct)dc. ARTICLE XIV VA l XATlO~ 1-1. 1. Fair Value ur Company Proper!\. lhe Fair Value nr propt'rl> 1:on1ributed tn the cl))11pan: b) a iVk mhcr ns pnrt oC sud1 \tknibcr·s Initial Capiwl Contribution is the UlllOllllt or '\UL' h ivkrnb1.·r":-. Init ial Capital Conlributil.lll. ns s t'! lcH"th on Exh ibi t. \ . minu:-; the amount l) r an) 1 L'ash cD11trihuk·d w the Ct1mpa11y as pnrt nr such \tlcmbcr"s Initial Cwital Contribution . 111 nil E"\1111111 ,.\ ll 'flX l~h2 ~ I.! .21111 MR.505 nlh1.·r casl.'s. !hi.' fai1· Va lue of an nssct as or nny dntt> is its fa ir 11'arkct \'alue as dcll.!rmincd by the ivlnnagcr-; in goml foith using nn) reasonabk \'aluaLinn method. Ir any aftccted \-km her dnes nol H!.!.rcc \\ilh the \aluation sd b\. th..: Mamrners. the Fnir Vnlue shall bt: determined usinu ~ ~ ~ pweedures similar lo those set ronh in Sed ion 14.2. and the cost or any such dt:lcrminalion shal l he hnrnc cntlrdy by the affec ted Member unless the Managers or :1 majority in i1itcres1 or nl l \ikmbcrs 01h1:r than the al"l\:ctellbrn it lo the Compnny n notice or ohjectil)n ,,·ithin :W tlays or the Member's receipt ur thl'.' \'hall b0 linnl :inti binding on all rnnccrncd. absent mnni fest errnr. (d ) n1c cnsl or l.'ill'h apprni:rnl sha ll be shnrcd cqllloticc. t\ny notice. rt'pml. or l>Lhcr com111u11icritio11 required or permitted to he madl' l1i an: person by this r\ g rL'C111('11I ::.hnll hl" in \\riling u11d i-; dccml'd gi,·cn \\'ht:n (a) dl'li\l'rd to the p1..·rslltl hy hand. (b) lhL' 1hird business day allcr deli\ cry lo thc l.'ni!cd States Postal Sen·ici: (or other designati.::d dcl i,·cr: scn·icc as dclincd in l.ftC. Section 7502(1)). postage prt'paid. in an ~nvclopc properly addressed to the person l'll th~ person·_., address set 1·orlh in the Co~npany ·s rL'COn.ls as ur the date llr th:li\er!. or (t) SUL'.CL'Ss!'ully transmillcd b: focsimik or ekctronic mt::ssagc In I he focsi m ik phrn1l.' number or e-mail address (as uppl icnblc) set forth in the (\1mpnny\ records as or the d~tLL' Ill' transmission . /\ny Ctn11mu11icmion l<) th~ Manager., or tile Company may be dc li n:n:d ll) 1hc Company"s registl'rt:u olfo.~c designated purs~mnl to Section 2.3. F. \1111111 ,\ I l'C1:-i-l~1 ! ! I ! 201 I MR.507 15.3. (ion:rnin~'; (\111scnl to .luriscliction. This /\g.rccmc11L is gowrncd by nnd shnl I hc tunstrued under the l:d usivc stnlen1ent or the agreement he tween the parties \\ ith 1\~spect ln its subjL'cl mnltcr. l :'di. Sm:ccssurs nnd Assign~. ~o Member · to upprovc. c:onsenL or agree to the substanli\'e terms of nny rtgrccmcnl or other document on bcha lI' or such Member. (c) The po,\·er of nttorney granted pursuant to thi s Section 15.12 \i) is a spec ial po\\'cr of atlorney coupled \\ith un interest and is irrevocabk, and (ii ) smvives the \\'ithdrawa l or remova l ora Member or the assig.nm~ut of· its Membership Interest. !Thi~ Page ln tcntiouaUy Left Blank. Signature Page Follows.I f'..\ llllH r A 11 ,'() ~~ ~v! !!12, 21) I~ MR.509 I~ :\('Ctttcd as nl" the Hlix:ti\'c Date set forth abm L>. by [Ind umong the p1..'rsons signing M ;m: r-.r1nrrrn.:cl1. an indi\·idual / 1\ntonio 1\lbanesc. an individual EX ll llll I ,.\ I 150X.ll11 Z l I~ 1011 MR.510 EXHIBIT A Effccti\'e ;\s of September J8 1 2D IJ Number of MEMBl<:I~ NAME AND ADDllESS Initial Capital Contribution Units TXC Energy LLC 560 I Preakness Ln 300 $300.00 Plano. l'cxas 75093 Marc ~larrocco 3602 Bink ley Avc JOO $300.00 Da ll a~. Texas 75205 Antonio Albanese 6605 Gentle Wind Ln 300 $300.0IJ Da llas. Texas 75248 CO~ll'."' A GHl.: l-'.\H.:-.1 01· Ct:\I ~ IHO\ Luc 1 -. nc~ LLC E .\ 1 111111 A I J 51J~ ~lh ! l · I ~ ·! o 14 MR.511 COMPAJ\Y AGREEMENT OF CENTURION LOGISTICS I.LC' EXl-IIUIT B SPOCSAL .JOll\l>ER A'.'11> CONSENT I 1\CKl\OWl.EDGE (il TllAT J !!AVE Rl:AD ll!E FORECJOll'\G COiVIJ>A:\Y AGRJ:l ~ :-VIEN.I OF CENTl: RJON I .OCilSTICS LLC (THE ··AGREEMENT'). (ii) Fl :1.1 . Y CNDERSTJ\ND ITS CONTENTS, AND (i ii ) I ll AV L: BEEN GIV EN T llE OPPORTUNITY TO ASK QUFSTIO\JS i\1\D ro SF l: K !\ND OBTA IN Tiii'. ADV ICE OF LEGAL COl)NSEL CO\JCERNING MY RIG! ITS. AND Tl II-: l.IMI l'ATIO\JS ON ll IOSI·: RICJI ITS. THAT 1\RE CON TAIN l:D IN Tl IL ACl!U:EMENT. I agrcL' tu be bound by all of tht: tcm1s or the i\grcclllent. including. without limi tation. the provisions or S~:ction I0.8. I am a\\:trc thnl, by the J'>ro,·isions the or /\grcement. my spouse agrees to hold his or her Membership Int erest (as such lcrm is ddint:d in lhc /\gn:emenl) including any portion of such Mcmbershi p 1ntcrcst comprising my rnmmuni Ly property. subject to the spcci lic reslridions nn the Lransrcr or such Membership lnt~rcsts Sl'l forth in the Agreement. I agree that I will not make any lrunsfcr of. or Dth1:nvise deal \\'ilh. such Membership lnll:n:st or 111) communi(y property interest th~rci11 , ir any, during my liletime exc...:pt as expressly pl'nnincd by lhc 1\grt:einent. As provided in Section I0.8 of the Agreement . I agree that. in lhc event or my dcnth. any lvkmbership Interest that constitutes my rnmmuni ty property slw\tld pass lo my spouse. and I agree to \viii anti bequeath my entire community property intcn.'::;\. il"nny, in -;uch Membership Interest to 111) spousl'. Printed \!amc : _ _ _ _ _ _ _ __ __ __ l);ne: - - -- - - - - - - - -- - - -- EXllllll I B 11 511~ l !\1 :'. :> I ! 2111 1 MR.512 COMPANY AGREE~IENT Of CENTt:IHON LOGISTICS LLC APPENDIX A /\.I l11troductio11. This AppL'ndix sets forth principks under wh ich items ot' inL·omc. gain. loss. deduction and credil shall be al located among the !\tkmhcrs. Th is Appendi x also prn,·idcs li.>r 1he ch:term ination and maintc.·nam:c of Cn piLal Accou nts. generally in acco rdance or with TrcaSlll') Rcgulali<.lllS prnmulg,atcd umlcr l. R.C. Sel.:l ion 704(b). for purposes dctcnnining su<:h allocl'I Value ol' nn as-;d ha-; b-:cn determined or <\djustcd pursu<1nt 10 '\ubparng,rnphs(i). (ii) or (i\') of th is deli11itio11. thc assct·s Ciross Asset Va lue shall 1hcrraf'ter hr ~1djt1'\tcd b) the L>eprccintion lakrn into un:ounl \\'ilh respect In such assel ror purposes ur computing Net Profit and Net Lnss. ··~el l'ruli(. and ··:-.Jct Luss'· 1rn:.'rolil or Net Lnss. slw II be sub!rm:kd from such taxable incoml.' nr loss. (iii) Ir the Gross Asset Value of any Company asset is adjusted pursuant to subparagraph ( ii) or (iii) of the Section A.~ definition of Gross Asset Value. lhe amount of such adjustment shall be takl'.'n into m:counL ;1s gain or loss from disposition or thi.: asset for purposes or computing Net Profit and Net Loss_ {iv) Gni11 or loss resulting from any disposition or C:nmpany properly \\'ith rt:$pect to "hich gain or loss is recog11i1.ed for lc r sue h property differs from its Gross 1\ss~l Value. (\') In liL:li 1,f th\: depreciation, amorli1atio11, and other cost rcCO\l'r) dcductinns taken into t1<.:cou11t in computing such tnxnbk income or loss. there shall he wkcn into uccount lkpn:ciatiun computed in nccordnncl:' with the definition or [)~precia1io11 in Section A.2. (,.i ) To lhc cxtL·nt tin adjustment to the adjusteu tnx hnsi s of n11) Comp:111) asset pmsuall\ to I. R.C. Section 734( h) is n:qui red pursuant to Treasury lkg.ulations Section I .704-l(b){2){i\·)(111J(./J Lo be taken inlo account in tl<.:tcrmining Capi1a l 1\<.:cuu11ts as n result or a distribution othL·r thnn in liquidation or a Member"s ~ l e111bernhip Interest. the amt)lllll of such mljusunrnt sha ll be lrL'atc:d us nn item tl l. gain tir the adjui:.tmcnl intreascs the h<1sis or the U..'>SCL) or Joss (if the adjusl111Cllt dccrca:-;cs thc basis of thl' asset) from till' disposi tion of the :\'iSel nnd sh:ill he takl.'n into account !'nr purposes ol' computing Net Profit nr >Jct l .oss . .. Nonrl.'coursl.' Deductions·- has the 111eu11i11g. set l'urth in I rcasury Regubtfons Section I .704-2{b)( I) and shall he dctennincJ i.'lcrording lO the prO\ i~ion::- or Trcasur~ Rcgulatinn' Section 1.70-i-2(<.:). ··Nonrccuurse Liabilit\ .. has the lllL'~ning. set forth in rn.~asur) Rcgul R..:gulatinns S\..'ction I. 7U.+-2( b )( .+ ). -·Partner Norm.'ClHlfSC Debt Minimum Gai n"" has the ll1l.:aning S1.' t forth in rn.:asury Regulations Sect ion l.70.+-2(i )(2) and shall be dderm incd in accordam:I.' \\ith Treasury Regulations Seel ion I. 70-l-2( i )( 3 ). ··Partner t'\rnwi.:i:oursc l)cduq ion{· hns the meaning set forth in Treasury Regulations Sect inn I.70-l-2(i )(I) and shall be detcnnined in uccordam:c with l"n:asur> Regulations Section I .704-2(i)( 2). ··J>mtm:rshig Minimum Uain·· ha:-; the rm:aning se t tt1rlh in J"n.·asur) Regulations Section l. 704-2( b)( 2) nnd shall be ddermined in m:cordance \Yi th lren s ur~ Regulations Section I. 70.+- 2( d ). !\ ,J Capitnl t}ccounls. The Company shall determine and maintain Capital t\ci:ounts. ··Cripitnl Account"' mean s an account of each Mcmber determined and maintai ned throughout the full term 111" I.he Co111pany in aci:ordan<.:c \\ ith lhc ca piLal accounting rules of fn:asury Regulations Section 1.704-l(h)(2)(iy). Wi thout limit ing the gcnl..'rality or the fnrt:goi ng. thl' IOllmYing. rules apply: (a) T he Capital Account or each ivkmhcr shall be tn:ditcd \\i th (i) an amnunt equal Ln such f\kmbcr ·s Capital Contributions and the Fair Value of propcny contributed (il"perm ittcd hereunder) lo tile Cnmptrn) by such ~lc m hcr. (ii) such Member's share ol' th() Cornp;my.. s >Jct Profit. and (iii ) the amount nf any Cumpany liabilities nssumc.:d b~ such Member or tlmt arc seturcd by propcrl) distributt?d to sut h :Vkmbt>r. (b ) !'he Cnpitnl ;\crnunt ur each Member shall be debited by ( i ) the umounl ol" cnsh and the Fair VJet 1.oss. ond (iii) the amoun t nf any liabili ties or such Mcmhl.'r assuml.'d h~· the- ( \)lnpany or thnt nre see med by nny propl.'rt y conlribult>d by such Member to the Compan) . (<.:) l lp~in the lransf"cr b) a ivh.:111hcr {lf all or part or nn i11krest in the Company alkr the the Capital 1\CCOlllll or th<.: trnnslcror thm is allrihutahlc lO lhe trnnslcrred l ~ fli:c l i\e l);ih.' . i11tcr1.·st cnrrie~ (lW r lo 1111: trnnsfcrce and lhe Capital l\ l'counls 1il" the ;-..,fi:111hcr.s shal l be adjusted tli the e:r ck:<.:! i\'C la:-. lrcmmcnl or such items at the \.kmbcr k\·d. {I) rhc pru\'isiuns l)f this .'\ppcndi:x and or the Agrl!~rnen t n:lating In thl! mai11tc1U11H.:e o !" C'npi tai Accounts are intended to tom ply with Trc<)Sliry Rcgu lat ions Sect inn l. 704-1 ( b )( 2 )( i\· ). nnd slwl I be interpreted and '1pp1ied in n mnnncr consistent \\jlh srn.:h rrcnsury Regulposcd Treasury Regulations published nn January 22. 2003 168 Fed. Reg. 2930}, as thl'y may subsequent!) he mod ilic. Company Ne! Profit and Net Loss shall bt: <1llt1L·:1lL'd to lht: Member~ as follows: (a) Nd Prolit. \kt Prnlil for an~ pl..'riml (c:-:cluding lax ill'ms allocated pursuant to Section~ J\A.2 and 1\.-U) shnll he allm::atC'd ns f(.1llows: (i) Nc:t Profit ~hull l)L• nlkH.:atl'd lo th~· l\ll'mhcrs ll) thl' l'\lcnt or ittld in Fir~l. proportion ln the l'Xl'L'SS, ii' nny. or (i) the l:llllllllati\C \kt Loss ;1llocatcd pursuant I t> Section t\A . I (b} 1·(1r oll prior periods. m"i.:r (ii l lhL· ru111ul:itiw N1.'t Profit :illocatl'll pursuant Lu !his Seclion A-Ll(n) l'nr all prior periods. (ii) Second. any remaining. 1\et l'rl.l lii -;hnll b1.· allocated lll the i'v kmhcrs pro rnw in nccordancc with their respceii' t? Percen tage Int1.'rcsls. (b) Net l.oss. Net Loss ror an) period (c\clt1di11g 1ax items allocated pursuant lo Sectinns :\ .·U aml t\.4 ..1) sh ~dl be :1110<.:a tcd as folio\\~: (i} !'ct Loss shall be alloeatcd tn the \kmbcrs pro rata in accurdnncc \\ilh tht:ir respcdi\t: Pt:n:t:ntagc Interests. s uhje-:t tu the limitution in Si.:ctinn 1\.4. l (b)(iil. C0\11' \ \ \ Ac; 1u :o1•,\ I CH Cl.\ I l IUO\ L0<;1, I II''- Ll.C P \(; I. A-5 MR.517 (iiJ No Mcrnhcr 11l tl~ rccc1,·c nn allocntion or Ne1 Loss that would criusc ·tl1L· \ti ember lo lul\'e an /\djuskd Capi tal Accoun t Delicil at the cm! nr the la:->ahk year. N~t Loss not allocated to a .v kmbcr pursuant to this subparagraph I ii) shall he allocated to other Members aceL)l"ding to tht:-i r relative positi\·c Capil!ll A<.:n)Unl balances (rnlcu latcd taking into account the adjustments described in the- dclinititlll or Adjusted Cnpitnl Account Dcli-.:it). /\.4.2 Regulatory Allocations. Thl' rollo\\ing Sj)L'Cial allocations shnll be applied in lhc order in \Vhich they arc listed. Such ordering is intended to comply with the ordering rules in Treasury Regulations Section l. 704-2(j) and shall be applied consistently thercwi th. (a) tvli11imum Gain Chnrucback. b:ccpt as otherwise provided in rn:asur:- Rcgulations Section l.704·2tl). notwithstanding anything to the contrnry in th is Section t\A . il' lhlTC is n nd decrease in Pn11nership M inimum Gain during any taxable ycm. em.:h ivkmbcr shall be alk)calctl items ol'incomc <111d gn in l(ir that ta:-;nble yem (an tht: amounts. ii' any. allocated pursuJonrccoursc Debt Mini1m11n Gain (determined in accordance with l'reasury Regulations Section I .70-1-2(i)(5)) as or the beginning of the taxable ) 1.:ar shall he allocated items or Con1pany illt(l!l)e and gain for that ln;.;ahlc year (nnd. it' nctcssary . for subsequent laxnhlc) cars) cqllal to that Member's share of lhc nd dc<:rcasc in the Partner >Jonn:c.:ourst' J>cbt i'vlinimum (iain, ddl.!rmined in acconl ancc \\:ith rrcasury Rcgulut i ons Section l.70-l-2(i)(4). lhis Section 1\.4 .2(b) is inli:ndcd to compl) w ith the chnrgcbnck nr partner llC>lll\~l'Olll'Se debt minimum gain rt•qui rcd b) lr<:ast11') l{egul), items of Coinpan: inrnmc and gain shall be special!: nllocatc:d to sul'l1 Member in nn amount and manner ~unicicnt to l!liminatc. Lo th..: extent r-:quircJ by the Treitsm:- RegulatiL111s. Lhc Adjw;ted Capital /\t:coun t !)elicit or such ~·lemhcr us quid ly as pn.ssihk'. An allornt ion pursumil to the forego ing senh:nce shal I be made Mly l o tht: extent that such \'1cmbcr '' tHtld Cllc h basis) and such gain or loss shall bt: spet iall) all'> . or dt:dw:tion pursu<111t to this Section ;\.-Ll. I hi: n:li.ll'l\ 110L\\'iths1nndi11g nn) nth<.: r pro,·isions tir thi .:; Section 1\A (other thun the Reg.ululLH) r\llocntions). the \,tanagers shnll make suc h orlselli ng specia l ntl()Cntions or C o11 1ptt11) inrnmc. gain. k>ss. or deduction in \\hale\l.'r mann~r the ivla11:1gcrs dctcnnint· appl'opriate so lhat, nlkr such nl"fset ting al lrn.:alions arc made. l.'ach i\.km bcr"s Cnpi tnl Accoun t balance is. lo the c:-;tcnl possible. L'qual ln Lhl· Capital 1\ccounl balance such l'·kmbt: r \\(Hild hn' e had if the Re~ula tury .'\llticaliuns \\erl' not part o!' the 1\grecnw11t and all Company ilt:m$ w~rc allocated pursuant lo Sec ti on 1\ .-L l. 111 exercising their di scretion 1111dcr this Section 1\AJ. the :-Vhrno~ers sha ll tnkc into ncrnu11 t l'ttlllrl' Regulator;.- 1\llncf\tin11s under Scl:li D11s r\ .-L2(a) and 1\.4.2(h) tlml. although not ~cl mad..:. nre C0 \11' ' ' ' A<.IU:l"\11 ."\I orCt"\ll IU()"\ l.0<. 1'-ll<'S 1.1.C l'\1:1 ,\-7 MR.519 Ii ki:I) to n ffs1:.•t other RL'gu latory ,\I lrn:atinns prL'\'iousl) madl' umkr Sections ;\ A.2k l •llld i\.·L::!( I). :\AA Other Allocation Rult:s (a) Net Profit. >kt I.nss. nnd nlht:r ill'J\ls shall bl' ~1 1l ntatcd Lo thl? :vtcmbcrs pursuant to thi s Appcndi :-.: A as nf the last (.hl) or each taxabk year, and 1\1 su<.:h times ns the Gros-; Asset Values orCompany Properly :trt' adjusted pttrsunnt to subparagraph (ii ) of the dclini tion o r Gross Asset Va lue. (b) Ir during any taxable year any tvfombl'r. s P~ n.:cntage Intercst changes. cnch Member· s share or Net Prolil. Nl.'t Loss. and other irems !Or such taxahk year shnl I he determined according Lo thc i1· varying intcn:sts c1 nd l.R .C. Section 706(tl). using any conven tions permitted by law and sckcli.:d by the Manag1..·rs. {c) All a llm:alions pursunn l LO th is Appi.:nd ix shall. except as otherwise provided in th is ;\grccmcnt. be d ivided among the Mcn1bers in proportion tu the Percentage lntcrcsL-; held b;- each. (d) For p urpo~es ot' determining a ;-.,,\cmht:r's share ol'Com pany ··exec~:; nonrceomsi: li nbilitit·s·· \\i lhin the meaning o r l'rL':lSll r} Rc-gulations Section l.752-J(a)(J). the Mi:rnbcrs· shares () r Company profi ts shall he deemed to be in proportion to their respcct i\'c Pcr<:t'1Hage l meresL-;. (e) I o lhc c.\lcnl perm itted b: Trcusur) Regu lations Sec tion 1.70..i-l(h)(J}. the \ilanng.crs lll:l)' treat any distribution or th!.! pro...:ccus or a l\onrccoursc I .iabilily or a l'ari 11i.:r Nonn..·coursc Di.:ht (that wou ld otherwise be allocable to an increase i11 Pnrtncrsh ip Mi nimum (iain} as a distribu tion thn t is not allm:ahle lo artncrship Mini mum Gflill lo the e.\ tcnt the Jistribuliun uocs IH'.ll cause or incrl.'usc an ;\djusletl Capital Account IJd icil fo r an: Member. r\.5 Tax ,\ llocntiuns (a) In General. r7 xcept :'IS other\\'isc provided in this Section /\.). each ikm \\f innHnc. gain. loss. and dcdlll:tion ul' the Cn111 pu11y fo r klkra l im:\)1111? tax purposes sha ll b1: .1\ppl•11di:\ . (b) Con tributed or Re,·11lucd Prnpcrl\' . In aLTtmlant:c with l.ltC. Sl'l'tion 70-1-(c) and the rela ted Trensury Regu lation.-;. ineomc. ga in. lo:;s. :md 1.h:ducti()n \ri th respect to an> pn)pC:rt> rnntri butcd to the eapital or the Cnmpany shall. ::;olcly f'or lH'\ purposes. be allot.:atcd amon~ till' Mernb1..•rs so as to takt.: a cl'Olllll ur any \'KLV@ DXWKRULW\ LQ WKH FRXUVH RI WKH &RPSDQ\¶V EXVLQHVV ´ WKH &RPSDQ\GRHVQRWLQGHPQLI\&DOFHIURPDQ\DFWRURPLVVLRQWKDWLVQRWZLWKLQWKHVFRSHRIKLV DXWKRULW\ RU LQ WKH FRXUVH RI WKH &RPSDQ\¶V EXVLQHVV 0RUHRYHU WKH &RPSDQ\ $JUHHPHQW VSHFLILFDOO\H[FOXGHV³LQWHQWLRQDOPLVFRQGXFWRUDNQRZLQJYLRODWLRQRIODZ´IURPWKHVFRSHRI &HQWXULRQ/RJLVWLFV¶LQGHPQLILFDWLRQREOLJDWLRQV ,QWKHSUHVHQW FDVHDVVWDWHGLQ 3ODLQWLII¶V2ULJLQDO 3HWLWLRQWKH³3HWLWLRQ´WKHDFWLYH SOHDGLQJRQILOHLQWKH/LWLJDWLRQ&HQWXULRQ/RJLVWLFVDOOHJHVWKDW&DOFHVLJQHGDGHHGRIWUXVWLQ KLVFDSDFLW\DVPDQDJHURI&HQWXULRQ3HFRVWRVHFXUHDSURPLVVRU\QRWHIRU%DOOHQJH,QWHUHVWV //& DQG ODWHU VLJQHG DQ H[WHQVLRQ RI WKDW VDPH QRWH DV D PDQDJHU RI &HQWXULRQ 3HFRV 2EYLRXVO\&DOFHZDVQHLWKHUDFWLQJQRUSXUSRUWLQJWRDFW³ZLWKLQWKHVFRSHRI>KLV@DXWKRULW\LQ FRXUVHRIWKH&RPSDQ\¶VEXVLQHVV´DQGZDVHQJDJLQJLQ³LQWHQWLRQDOPLVFRQGXFW´DQG³NQRZLQJ &RPSDQ\$JUHHPHQW6HFWLRQ &RPSDQ\$JUHHPHQW6HFWLRQD 3HWLWLRQ MR.529 0U.LWQHU 6HSWHPEHU 3DJHRI YLRODWLRQRIODZ´$FFRUGLQJO\&HQWXULRQ/RJLVWLFVPXVWGHQ\&DOFH¶VLQGHPQLILFDWLRQUHTXHVW DVWROLDELOLW\DULVLQJIURPWKLVFRQGXFW 7KH 3HWLWLRQ DOVR DOOHJHV WKDW &DOFH DORQJ ZLWK 6WDPSHGH ³SXUSRUWHG WR REOLJDWH &HQWXULRQ 3HFRV WR DVVXPH %DOOHQJHH ,QWHUHVWV¶ REOLJDWLRQV XQGHU WKH QRWHV IURP %DOOHQJHH ,QWHUHVVWVWR7&%´&DOFHZDVQHLWKHUDFWLQJQRUSXUSRUWLQJWRDFW³ZLWKLQWKHVFRSHRI>KLV@ DXWKRULW\LQFRXUVHRIWKH&RPSDQ\¶VEXVLQHVV´DQGZDVHQJDJLQJLQ³LQWHQWLRQDOPLVFRQGXFW´ DQG ³NQRZLQJ YLRODWLRQ RI ODZ´ $FFRUGLQJO\ &HQWXULRQ /RJLVWLFV PXVW GHQ\ &DOFH¶V LQGHPQLILFDWLRQUHTXHVWDVWROLDELOLW\DULVLQJIURPWKLVFRQGXFW )XUWKHU WKH 3HWLWLRQ DOOHJHV WKDW ³&DOFH FUHDWHG D QRWH SXUSRUWLQJ WR REOLJDWH &HQWXULRQ3HFRVWRPDNHSD\PHQWVWR&HQWULRQ7HUPLQDOV´$VEHIRUH&DOFHZDVQHLWKHUDFWLQJ QRUSXUSRUWLQJWRDFW³ZLWKLQWKHVFRSHRI>KLV@DXWKRULW\LQFRXUVHRIWKH&RPSDQ\¶VEXVLQHVV´ DQGZDVHQJDJHGLQ³LQWHQWLRQDOPLVFRQGXFW´DQGD³NQRZLQJYLRODWLRQRIODZ´$FFRUGLQJO\ &HQWXULRQ /RJLVWLFV PXVW GHQ\ &DOFH¶V LQGHPQLILFDWLRQ UHTXHVW DV WR OLDELOLW\ DULVLQJ IURP WKLV FRQGXFW )LQDOO\ WKH 3HWLWLRQ DOOHJHV WKDW &DOFH DORQJ ZLWK %DOOHQJHH ,QWHUHVWV ³FUHDWHG IUDXGXOHQWQRWHVE\&HQWXUULRQ3HFRVWR%DOOHQJHH,QWHUHVWV´ $VEHIRUH&DOFHZDVQHLWKHU DFWLQJ QRU SXUSRUWLQJ WR DFW ³ZLWKLQ WKH VFRSH RI >KLV@ DXWKRULW\ LQ FRXUVH RI WKH &RPSDQ\¶V EXVLQHVV´ DQG ZDV HQJDJLQJ LQ ³LQWHQWLRQDO PLVFRQGXFW´ DQG ³NQRZLQJ YLRODWLRQ RI ODZ´ $FFRUGLQJO\ &HQWXULRQ /RJLVWLFV PXVW GHQ\ &DOFH¶V LQGHPQLILFDWLRQ UHTXHVW DV WR OLDELOLW\ DULVLQJIURPWKLVFRQGXFW prov11I. • Compnny will perfonn 1111 inlraplnnl switching nt the Fncility. • Based on Company 's conceptual plan dnted April 17th, 20I 11, only unit train service is npproved al the Facility. • Compa11y will ensure that nll outbow1d railc11rs <1rc coupled with air hoses laced. • Company shall assemble each u11'i t lrain on its track B (based on Company's conceptual pion dated April 17th, 2014 ), in ifs cnl ircty nnd ready for departure. • ltHcrior switches must be lined for nrriv<1I ofinhoond train when n \111it train arrival is cxpectixl. MR.533 BALLENGEE00000408 Centurion L.ogfslics Pecos.TX 6112/2014 • The Fncility must have sufficient ca1mcity to chamber full unit trains, accotnmodatcsput on arrival, and ullow lrains to clear tllu main line without the train crew stopping lo line switches. Maximum unit train size to be dictc:rmlncd by UP's Customer Service Profile (CSP) process. • 'l'he Facility as rcnected in Company's couceptllnl plan dated Aptil I 7th, 2014, will acco111111od11tc inbound nnd 0111bo1111d 011erntio111s coming from nnd going lo the cost of the facility. If Con\pany desires lrnin operntions from ori:~ins west of the foci lily, Industry nn1s1 bear all cos1s of installing o. west facing connection with power switches ond power derails. Once Company has satisfied the aforementioned terms and conditions, the next steps in UP's track authorization process ate as follows: 1. Company must prepare tho Facility's Switch Location Plan (30% drawing) and submit to UP via the En!Jlneering Document Exchange (web application) to initiate UP's design of the signal system associated with Company's project. 2. Company will work with its UP Marketing and Sales ropresentatlve to prepare a Customer SeNice Plan, ilf applicable. and determine the rail service Company would receive and the corresponding rates. Additionally. the UP Marketing and Sales representative will coordinate with other UP departments to determine any other requirements necessary for UP to provide service to Customer. 3. Company m11st prepare the Facility's track design/construction drawings and submit them to UP via the Engineering Document Exchange (web application) for approval. 4. Company must execute an Industrial Track Agreement with UP. UP shall only authorize construction of the industry track upon the execution of a Industrial Track Agreement. UP shaU keep confidenllal all design/construcllon drawings, plans and other materials related to the new or expanded Facility that Coompany gives UP during the track construction process. Union Pacific's offer of conditional acceptance shall expire if Company does not execute and return this MOU to Shanker Chalek,ode at Union Pacific Company, 1212 Corporate Drive, Ste 300, lrvlng,TX 75038, within 90 days from the date of this MOU. Once executed, thi$ MOU shall terminate twelve (12) months after execution unless Company has requested an extension of the MOU. The extension must be requested in writing and approved by Union Pacific. Company understands that Unlom Pacific will not authorize construction of the planned Industry tracks until the entire track authorization process Is complete. Company understands that at no time prior to authorization of track construction Is UP agreeing to provide rail service at Facility. Fu1rther1 Company un derstands that Union Pacific wlll not operate on industry owned tracks until UP has approved the Facility track designfconstrocUon drawings and Company has fully executed an Industrial Track Agreement with Un1on Pacific. Additionally, Company understands that all of UPjs approvals and authorizations ate based on Company's representation of particular volumes and commodities that will be shipped to and/or from the Facility. Any changes in volumes or commodities may change UP's requirements to provide service to tho Facility. Consequently, If volumes or commodities change after rail service has beguh, MR.534 BALLENGEE00000408.02 Centurion Logistics Pec:os,TX 6/12/2014 UP may not be able to meet C()mpany's expectation for increased or additional rail service without Company making modifications to the Infrastructure or constructing additional Infrastructure, ACKNOWLEDGEMENT: I HAVE RE:AO AND UNDERSTAND UP' S REQUIREMENTS FOR NEW SERVICE AS SET FORTH AE~OVE: Union Pacific Railroad Company Sy:~-" Printed Name: :Bt.:L f MR.535 BALLENGEE00000408.03 Conturron Logistics Pecos.TX 6/12/20 14 UNION PACIFIC RAIL ACCESS Track Construction Project Contacts Prepared for: Centurion Logistics; Track Construction Project Location: Pecos, TX 6112/14 Marketing and Sales Representative Shanker Chalekode Business Director 1212 Corporate Dr. STE 300 Irving.TX 75038 402-871-9164 Fax: 402-997-4947 skchalok@up.com Manager of Industry & Public Projects Steven W. Martchenke 101 S Walson Rd, Arlington.TX 76010 817-353· 7625 402-501-2616 swmartch@up.com Regional Manager Industrial Development Aaron Drown Rogional Industrial Development Manager 1212 Corporate Dr. Ste 300, Irving, TX 75038 '169 262 7059 '102 233 3453 akbrown@up.com Track Agreoment Contact Tammy Anderson Sr Mgr Industry Track Construction 1400 Douglas St Stop 1350, Omaha, NE 68179 402 544 2305 402 233 2187 tlanderson@up.com MR.536 BALLENGEE00000408.04 ([KLELW³+´ MR.537 This is a legally binding co11trnct. if not underslnod, cnnsul1 !ill attt.imey. C OMMERC I AL REAL E ST AT E SALE C ONTRACT 1. PARTIES: This contract ("Contract") is made by and between MONTANE INDUSTRIES, LLC. SELLER, and CENTURION LOG ISTICS, LLC. or assigns, BUYER. The "Effective Date"' of this Contract shall be the date the Escrow Agent acknowledges, in vvriting, receipt of the Earnest Money. 2. PROPERTY: Sell et ag!'ees to sel I to Buyer and Buyer agrees to purchase the fo llowing described real estate locat1ed in AB 5609, BLK 4, SEC 76, H&GNNW/4 & PT SW/4, together with any improvements thereon containing approximately I &3.400 acres of land, Reeves County, State of Texas, as depicted on Exhibit "A", ("Site Plan"), attached hereto. Such real estate and other property shall be col lectively referred to in this Contract as the "Property". The exact size and legal description shall be determined after a survey and prior to Closing. The cost oflhe survey shalt be bom e by Seller. 3. EXCEPTIONS: The Property shall be subject to the Pennitled Exceptions (as defined in paragraph 9 of this Contract), zon ing ordinances and laws and the following: Nothi ng add itionaJ. 4. PURCHASE PRICE:: The "Purchase Price" shall be One Million, Five Hundred Thousand N0/ 100 DolJars ($1,500,000.00) which Buyer agrees to pay as fo llows: within ten (10) days after this Contract is last executed, Twenty Thousand Dollars and N0/100 ($20,000.00) as " Eamest Money" which is to be deposited in the insured trust or escrow account at Chicago Title Insurance Company, 2828 Routh Street, Suite 800, Dallas, Texas 7520 I, Attn: Michael R. Haas (''Escrow Agentt') as part of the consideration of the sale~ the balance of the Purchase Price to be paid at Closing in immed iately available fu11ds. 5. INDEPENDENT CONTRACT CONSIDERATION: C011temporaneously with the ft nal execution and delivery of this Contract, Buyer shall deliver to Seller and Seller hereby acknowledges the receipt of a check in the amount of One Hundred and NOil 00 Doi lars ($100.00), which amount the parties bargained for and agreed to as consideration for Seller's grant to Buyer of Buyer's excl usive right to purchase the Property pursuant to the terms hereof and for Seller's execution, delivery and performance of th is Contract. Such consideration is in addition to and independent of any other consideration or payment provided in this Contract~ is non-refundable under any circumstances, and sha ll be retained by Seller notwithstanding any other provisions of this Contract 6. CLOSlNG DATE: Su~ject to all t he provisions of this Contract, the closing of th is Contract (''Closing") shall take p lace at the offices of the Escrow Agent within lhirty (30) days after satisfaction of a ll contingencies. herein stipu lated. Tenant-free possession shall be delivered at Closing. Closing is contingent on H valid Memorandum of Understanding (''MOU'') from Union Pacific Rail road. COITT18'cili RE!fi ESaeContrad-Mon\<11elndustries. LLC, ReevesCoonty 1 MR.538 BALLENGEE00000272 7. EXISTING FI NANCI NG: Unless otherwise provided in this Contract, Seller shall make any payments required or1 existing mo1tgages or deeds of trust unril Closing and upon Closing all such debts upon the Prop•erty shall be discharged from Seller's proceeds. 8. PRO RA TIO NS: The rents, income and expenses from the Property shall be prorated between Seller and Buyer as of Closing, Seller shaJI pay, in full, all tax liens, special assessments, and material and/or workman liens against the Property upon the date of Closing, whether or not any such liens or special assessments are payable in installments. The general ad valorem taxes becoming due and accruing duri ng the calendar year of Closing shall be prorated between Seller and Buyer on the basis of such calendar year, as of Closing. If the amount of the general ad valorem tax cannot be atscertained at Closing, proJation shall be computed on the amount for the preceding year's gene:ral ad valorem tax. If it is determined by Buyer, either prior to Closing or subsequent to Closing, ithat a subsequent change in the use of the Property may resu lt in the imposition of an additional rax ("Rollback Taxes"), Seller hereby agrees that: (i) If such detennination is made prior to Closing, Seller shall deposit at Closing with the Title Company an amount sufficient to pay one hundred percent ( l 00%) of all estimated Rollback T:axes, together with penalties and interest, in order to satisfy all applicable taxing authorities for both the Property and any contiguous property owned by Seller; or (ii) If such detennination is made after Closing, then any Rollback Taxes plus penalties and interest for both the Property and any contiguous property ovmed by Seller shall be paid by Seller- to Buyer within fifteen (15) days of recd pt by SeJler of a statement for the Rollback Taxes. Buyer shall obtain from the tax appraisal district established for the county in which the Property is located the amount of all Rollback Taxes. together with any penalties and interest Ifthe amount of Rollback Taxes has not yet been determined by the appl icable tax appraisal district, then Buyer agrees to obtain from a tax service pt~ovider a calculation and furnish said calculation to the Seller, which calculation shall be used for purposes of establishing the escrow with the Title Company or making the payment to Buyer. In the event any of such calculations are found to be erroneous after Seller has made the payment re:quired hereunder, then either party hereto who is entitled to such rei mbursement or additional payment shall invoice the other party and such amount shall be paid within fifteen (15) days of receiipt of a statement evidencing such corrected amount. These covenants shall not merge with the Deed to be delivered from Seller to Buyer and shall survive the Closing. 9. T ITLE I NSURANCE: Seller shall deliver and pay for an owner's ALTA title insurance policy insuring marketable fee simple title in Buyer in the arnount of the Purchase Price as of the time and date of recordatiion of Seller1s General Warranty Deed, subject only to the Pennitted Exceptions defined below. Seller shall, as soon as possible a11d not later than thirty (30) days after the Effective Date of this Contract, cause to be furnished to Buyer a current commitment to issue the policy (the "Title Commitment")_. issued through Chicago T itlE' Insurance Company ("Title Company"). Buyer shall hav,e thirty (30) days after receipt of the Title Commitment (the "Review Period") in which to notify Seller in writing of any objections Buyer has to any matters shown or referred to in the Title Commitment. Any matters which are set forth in the Title Corrirre-dal Rea ESae Contra::! - Montaie l~ries, LLC, Reeves Crney's fees, court costs and other legal expenses incurTed by the Escrow Agent in connection with such dispute shall be reimbursed from the Earnest Money or from other funds deposited with the Escrow Agent. 19. ENTIRE AGREEMENT AND MANNER OF MODIFICATION: This Contract. and any attachments or addendum hereto, constitutes the complete agreement of the parties concerning the Property. and ~:upersedes all other agreements and may be modified only by both parties initialing changes in this Contract or by written agreement. 20. NOTICES: All notiices requi red under this Contra::t sh~I bed~ to be properly served if rerluca:J to writing ood SErlt by (j) certified or registered mal ; (ii) Federal Express or smiler overnight oourier; (iii) focsimi le tra1smission; or (iv) persona delivery a1d the dcte of such notire will be deaned to have been the date on which &JCh notire is delivera:I or attempted to be delivered as shc:mn by the oo-tifioo mal return receipt or a commercia delivery savire ren>rd, or in the case of fa:simile on the date of receipt of the trcnsmission as shown on a successful trcnsmission ronfir~ion receipt. All notices shail be Cl:ldres:a:t as follows, unlessottawi se~fia:I iin writing: SELLER: BUYER MONTANE lNDUSTRIES. LLC CENTURION LOGISTlCS1 LLC, 3939 W. Green Oaks Blvd. #202 or Assigns Arlihf,rton, Texas 76016 17950 Preston Road, Suite 1080 Emai I: f.arceneaux@ielpros.com Dallas, Texas 75252 Facsimile No: 817-451-3903 22. TIME AND E..XACT PERFORMANCE ARE OF THE ESSENCE UNDER THfS CONTRACT. Buyer and Seller hereby agree to perform each and every obligation hereunder in a prompt and timely manner. provided, however, that if the date for the performance of any action or obligation, or any time period specified hereunder occurs on a Saturday, Sunday or Un ited States bank holiday, then such date or time period shall be extended until the next business day. Commerda Rea E!tes, tenancies, or persons in possession. f. Buyer and or assignee: agree that the property is to be developed into a rail terminal and rail served industrial park. Buyer and Seller agree to enter into an access agreement (the "Access Agreement") during th,e inspection period whereby the terms and provisions for Sell er~ s rights to access the Union Pacific maiin line t hrough the Property will be described. Additionally, Buyer and Seller agree to enter into an option agreement (the "Option Agreement") during the inspection period whereby Buyer and Seller will set the tenns for Buyer's right, not obligation, to acquire Seller's remaining 320 acres tract better described as Section 75, BLK 4, Reeves Councy. Texas. Commercial Rea EslaeCo'ltrac:t-Monttsrposes . .,, ................. ,, ...... ,..... ~······················· ·· ·················· 6 ! ...... , . . . ........... , . , ......... , .......... ....... 2.6. Powers ....................................................................................................................... 6 2.7. Con1pany Property ................................................................................................... 6 2.8. Consent to Admission of Men1bers ......................................................................... 7 2.9. Status of Managers and Metnbers ............................................................................ 7 2.10. Certificates of Membership Interests .......................................................................7 2.11. No State Law Pat1nership .................... ,..... ,......................... ,. ..................................7 ARTICLE III CAPITAL CONTRIBUTIONS; CAPITAL ACCOUNTS ...................................... 7 3.1. Initial Capital Contributions .................... ................................................................ 7 3.2. Additional Capital Contributions ............................................................................. 7 3.3., Capital Accou11ts.,~ .. ,, ....... ,..........,............ ~ ...............,.......... ,..... ,..,.,........... ,................ 7 3.4. No Right to Return of or Interest on Capital Account.. ........................................... 7 3.5. Me111ber Loans .........................................................................................................8 ARTICLE lV ALLOCATIONS AND DISTRIBUTIONS ............................................................. 8 4.1 . Allocation of Profit or Loss ..................................................................................... 8 4.2. Distributions of Distributable Cash ......................................................................... & 4.3'. WitJ1l1olding ...............................,....,......... ,................................................................ .... ,..... 9 4.4. Limitation on Distributions ...................................................................................... 9 4.5. No Right to Partition or Distributions in Kind ........................................................9 4.6. Recovery of Erroneous Distributions ...................................................................... 9 ARTICLE V MANAGEMENT; ACTIVITIES OF MANAGERS AND MEMBERS .................. 9 5.1. Management and Control of Company Business .................................................... 9 5.2. Resignation. Removal, and Replacement of Managers ......................................... 10 5.3. Actions of the Board of Managers ......................................................................... 11 5.4. Limitations on Board of Managers' Authority .., ................................................... 11 5.5. Delegation of Authority~ Oflicers .......................................................... ,................ 12 5.6. Reliance ................................................................................................................. 13 5.7. Compensation and Expenses of Members and Managers ..................................... 13 5. 8. Standards of Manager and Member Conduct ........................................................ 13 ARTICLE VI LIABILITY AND INDEMNIFICATION .............................................................. 14 COMPANY AGRlmMENT OF CISNTtlfUON PtC'OS TEltMINAJ, LLC PAGE: 6~ 11457. liSP/B03UOIOllll'>l IM MR.548 6.1. Limitation of Li abili ty ........................................................................................... 14 6.2. Indemnifi cation by Company .. ............................ ........ ........ .................................. 14 6.3. Conduct Not Protected .......... ................................................................................. 14 6.4. fnsurance ................................................................................................................ 15 6.5. Survival ................ ... ..... .......... ..................... ............... .... ............. ..... .... ..... .... ......... 15 ARTICLE VU BOOKS AND RECORDS; RE PORTS ................................................................ 15 7 . 1. Mai ntenance of and Access to Books and Records ............................................... 15 7.2. f'jscal Year .......... .... ... ........... ............... ... ... ............ ....... .... ........................... .......... 15 7.3. financial and Operating Reports ........................................................................... 15 7.4. 'J'ax Reports .................................................. .......................................................... 16 7.5. Transmission of Communications ....................... ........ .......................................... 16 ARTICLE VllJ T fu'< MArrTERS .. ....................... ....................... ........ ............. ......... ..... .............. 16 8.1. Tax Classification .................................................................................................. 16 8.2. Cornpany Returns ., ....... ..... ..... .... ......... .............. ....... ..... ................................... ..... 16 8.3, Tax Elections ............................ ....... ................ .......... ..... ......... .... .................. ........ 16 8.4. Consistent 'Reporting .............................................................................................. 17 8.5. 'fax ProceccUngs .................... ..................... ... ........... .... ........ ........................... ....... 17 8.6. Information and Documents to Company ...... ...... ........ ...... ......... .... ......... .............. 17 8.7. Survival .................................................................................................................. 17 ARTICLE IX MEETINGS AND VOTING OF MEMBERS ...................................................... 17 9.1. Meetings ................................................................................................................. 17 9.2. Voti ng ..... ............................................................................................................... 18 ARTfCLE x TRANSFER or MEMBERSHIP INTERESTS .,....... ........................... .... ............. 18 l 0.1. Limitation on Transfers ............... .......... ................. ........... ...... ........... ................... 18 I 0.2. Permitted Transfer oCMembership Jnterest.. ......................................................... 18 L0.3. Right of First Refusal; Tag-Along Rights; Triggering Events .............................. 19 I 0.4. Conditions to Permitted Transfers of Membership lnte1·ests ........... ......... ............. 20 10.5. Effective Date~ Distribut ions ............................................. ................... .................2 J I0.6. Transferor's Obli gations ........................................................................................21 I0.7. Assignee's Rights and Obligations ........................................................................ 21 I 0.8. Effect and Consequences of Prohibited Transfer ....................................... ........... 21 ARTICLE xr ADMISSION OF NEW MEMBERS ........................ ............................................ 22 l l . I. Substituted Members ............................................................................................. 22 11.2. Additional Members ..............................................................................................22 11.3. No Required Capital Contributions ......................... .................................... .......... 22 ARTJCLE xn WTTUDRA WAL OR REMOVAL or. MEMBERS ............................................~3 12.1. Withdrawal ofMembers ..... ......... .... ..................................................................... .23 12.2. Removal of Members .. .... ................... ........ .... ... ..................................................... 23 12.3. Status or f a whole and not to any particular Article. Section. or other provision hereof; (g) ..including'' (and with its correlative meaning "hlcludc'') mcru1s including without limiting the generality of any description precedlng such term: (h) ..or~· is used in the inclusive sense of ·•and/or'"; (i) with respect to the determination of any period or time, ·•from·· means "from and in.eluding.. and ''to" means "to but excluding"; and (j) references to agreements or other documents refor as wel I to all addenda. ~xhibits. schedules. or amendments thereto. COMPANY AGREEMENT OF CEXntIUON PECOS TlmMINAI. LLC PAGES 6211457.1/SP/33032/0101/091114 MR.555 ARTICLE IL ORGANIZATIONAL MATTERS 2. t. Fonnation. The Company was formed pursuant to the Certificate of Formation effective as of the Formation Date. 2.2. Name. The Company's name is as set forth in the Certificate of .Formation. The Board or Managers may change the Company name at any time without the approval of any Member by filing a certificate of amendment to the Certificate of formation. The Board of Managers shall provide notice of any such change to all Members. The Company's business may be conducted under its name and/or any other name or names deemed advisable by the Board of Managers. The Board of Managers shall cause to be executed and filed of record all assumed or fictitious name certificates for the Company as are required by law. 2.3. Registered Office and Agent: Principal Office. (a)The street address of the inilial l'egistered oftice of the Company in Texas and the or name of the initial registered agent of the Company are as set forth in the Certificate Formation. The Board of Managers may change the Company's registered office or registered agellt at any time by filing a Chu11ge of Registered Agent and/or Registered Office as provided in the Code. The Board of Managers shall provide notice of the change to all Members. (b) The addl'ess ()f the principal office of the Company in the United States where records are to be kept or made available under Section lO 1.501 of the Code shall be as determined by the Board of Managers. The Board of Managers may change the Company's principal office in the United States at any time upon notice to the Membel's. The Company sha.11 keep at its registered office and make available to a Member on reasonable request the street address of the Company's principal ofl1ce in the United States. 2.4. )£rm. The Company will continue unlil terminated in accordance with Article XIII. 2.5. Purposes. The purpose for which the Company is organized is for the development and operation of the Project and the transaction of any and all lawflil business for which limited liability companies may be organized under the Code. 2.6. Powers. Subject to any limitations in this Agreement. the Company may exercise the power to do any and alt acts reasonably related to its purposes. 2.7. Company Property. (a) All Company property shall be owned in the name of the Company and lHH in the name of any Member. No Member or Assignee wi II have any interest in such Company property ·solely by reason of the Member's status as a Member. (b) The Board of Managers shall cause all funds of the Company to be deposiLed or invested in an account or accounts in the name of the CompjAL LLC PAGE18 62f14S7.1/SP/33032/0101/091114 MR.568 (ii) the transfer occms in accordance whh the procedures set forth in Section (iii) if the Member 1s a corporation. the transfer is to a member of the Membcr·s af1iliated group (as defined in l.R.C. Section l 504(a)); (iv) if the Member is a trustee of one or more employee benefit plans, the transfer is to a co-trustee or a successor trustee to such plans; or (v) if the Member is an individual, the transfer is of a community property or other interest from lhe Member's spouse or former spouse to the Member pmsuant to the death of the Member's spouse or termination of the marital relationship of the Member and the spouse. (b) Upon a Pennitted Transfer by a Member of all of its Membership Interest. the Member ceases to be a Member as of the efiective date of the transfer delermined according to Section 10.5 . I0.3. Right of First Refusal; Tag~Along Rigbts; Tdggering Events. (a) Jn the event a Member desires lo sell al1 or any portion ofits Membership Interest to another Person, the se1ling Member shall first offer to sell such interest to the other Members on lhe terms on which it is prepared to sell such interest to such Persot1 by sending written notice tb each other Member describing the offer and its terms. Additionally, upon receipt of an ot1er &om a tl1ird party to purchase aH or any portion of a Member's interest in the Company, which such Member desires to accept, s1.1ch Member shall promptly deliver a copy of the third party offer to each other Member. Each other Member will have 15 business clays from the date of receipt of notiee of the proposed sale of a Member's Membership Interest or the third paity offer, as the case may be, to notity the se1ling Member In writing that such other Member elects to (i) purchase the selJing Member's Membership lntcresl upon the tenns and conditions of the proposed sale or thfrd party offer. or (ii) sell in the contemplated transfer, at the same price in the same form of consideration and on the same terms (including if the transter is made to another Member making an election under clause. (i), Membership lntercsts representing a Percentage [nterest in the Company equal to the product of (A) the quolient determined by dividing the Percenmge Interest owned by such party by the aggregate Percentage Interests owned by all parties participating in such transfor, und (B) the aggregate Percentage [nterests to be sold in the contemplated lransfer, as the case may be. lf the other Members fail to give notification within 15 business days of an election to purchase the selling Member's Membership Interest or participate in the contemplated transfer, then the selling Member shall be permitted, for a period of 90 days. to sell all of j1s Membership Interest to lhe third party upon the terms and conditions of the proposed sale or third party oner~ as the cass TERMJ:-.i:\L LLC PAGE23 6211457.1/SP/33.03210101/091114 MR.573 ARTJCLEXIII WINDING LIP AND TERMINATION 13.1. Events Requiring Winding Up. The Company shall commence winding up procedures in accordance with this Agreement and the Code upon the first to occur of the following events: (a) the Mernbers unanimously vote lo wind up and terminate the Company ~ (b) a dt!crec by a court requiring the winding up of the Company; (c) the tertnination of membership of the last remaining Member; or (cl) the resignaLion or removal of all Managers if the Members fail to appoint any replacement Manager as prnvided in Section 5.3. 13.2. Winding Up Procedures. {a) On the occurrence of an event requiring winding LIP of the Company~ unless there is un action to continue the Company without winding up in accordance with Section 13.3, the Board of Managers (or other Liquidator as prnvided below) shall, as soon as reasonably practicable, wind up the Company's business and affairs (including disposing of the Compani s assets and applying the proceeds as provided in Scctjon J3.4) and tc1111inate the Company in accordance with this Agl'eement and the Code. The Company shall cease to carry on its business (except to the extent necessary to wind up its business). collect and sell its properly to the extent the prope1iy is not to be transferred or distributed in kind, and pettorm any other act required lo wind lip its busi·ness and affairs. (b) 1f the Board of Managers has wrongfully caused the winding up of the Company ot· if there is no Manager, (i) a Majority-in-Interest may vote to elect a person or persons to accomplish the winding up of the Company, or (ii) if the Members fail to elect a person to accomplish winding up the Company. then any Member or Assignee may petition a court to wind up the Company as provided in Section 'l 1.054 of the Code. The µerson or persons winding up the Company. whether the Board of Managers or an elected or court appointed person or persons, i.s referred to in this Agteement as the "Liquidator.'' (c) The Liquidator may determine the time. manner, and terms of any sale or sales of Company property pursuant to such winding up. The Liquidator (ii' not the Board of Managers) is entitled lo receive reasonable compensation for its services~ may exercise all or the powers conferred upon the Bmu·d of Managers under this Agreement to the extent necessary or desirable in the good faith judgment. of the Liquidator to perform its duties~ and with respect lo acts taken or omitted while acting in such capacity on behalf of the Company, is entitled to the limitation of liability and indemnification rights set forth in Article VI. (d) The Liquidator shall provide quarterly reports lo the Members and Assignees during the winding up procedure showing the assets and liabilities of the Company, providing information and documents required by the Members and Assignees to comply with their tax reporting obligations, and such other information as the Liquidator deems appropriate. Within a reasonable time after completing the winding up, the Liquidator shall give each Member and Assignee a final statement setting fotth t11e assets, liabilities, and reserves of the Company as of the drtte of completion of winding up. COMPANY AGREEMENT OF CENTtlRION PECOS TEltl\llN1\L LLC PAGE24 8211467.1/SP/33032101011091114 MR.574 133. Continuation Without Winding Up. (a) lf there is a decision to wind up and terminate the Company as described in Section 13.1(a)~ the Company may be con(inued as provided in Section tol.552 of the Code. (b) If there is a termination of the continued membership of the last remammg Member as described in Section l 3.1(c}, then prior to completion of the winding up process but not later than 90 days atter the event of te1111inat1on, the Board of Managers may continue the Company by admitting one or more Members effective ~s of the occurrence of the event of termination. Any Assignee whose Percentage Interest would be diminished by reason of the admission of an Additional Member under the circumstances described in this Section must approve the admission of the Additional Member. l3.4. Liquidation of Assets and Application and Distribution of Proceeds. (a) In General. On winding up the Company, the Liquidator shall dispose of the Company's prope11ies and apply and distribute the proceeds, or transfer Che Company properties, in the following order or priority: to creditors (including Members who are creditors) in accordance with (i) their relative rights and priorities to sutisfy the Jiabilities of the Company, including expenses associated with the winding up and termination of the Company, but excluding any Company liability for any unpaid Mandatory Distribt1tions; (ii) to Members, Assignees, and former Members to satisfy the Company's liability for a11y unpaid M~mdutory Distributions; and (iii) to Members and Assignees as provided in Section 4.2(a). (b) No Member Deficit Restoration Obligation. No Member is liable lo the Cotr1pany or any other person for the repayment of any deficit in lhe Member's Capital Account, except as provided in Section l 01.206 of the Code •. (c) Reserves. ln the discretion of the Liquidator, n pro rata portion of the distributions that would otherwise be made pursuant to Section 13.4(a)(ii} and (iii} may be withheld to provide a reasonable reserve for Company liabilities (contingent or otherwise) and future expenses, including a reasonable reserve for any claims for indemnification under Article VI and for any future expenses associated with any tax audit or other Proceeding that is pending or may arise. (d) Payments and Distriburions to Members in Kind. The Liquithnor may not make any pay01cnts or distributions to Members or Assignees pursuant to Section 13.4(a){ii) or (iii) other than in cash unless all Members and Assignees receiving th~ property approve the transfer in kind. The Liquidator shall determine the Fair Market Value of any property lransforred to Members or Assignees in kind according lo the valuation procedures set forth in Article XIV. Character of Liquidating Distributions. Except as otherwise required by the (e) LR.C .. nmounts paid to Members pursuant to this Section 13.4 .shall be treated as made in exchange for the interest of the Member in Company property pursuant to l.R.C. Section 736(b)(l), including. the interest of such Member in Company goodwill. COMPANY AGREEMENT OF CEN'rtrRION PECOS Tl·:ltMllliAL LLC PAG.E.25 6211457 .1/SPl33032/0101/091114 MR.575 13.5. Certificate of Termination. The Liquidator shall file n Ce11iticate or Termination of a Domestic Entity on the completion of the wjnding up of the Company. 13.6. Reinstatement. If the Company is tcrmimltcd, it may be reinstated in the manner provided in the Code. ARTICLE XIV VALUATION 14.1. Fair Value of Company Property. The Fair Value of properly contributed lo the Company by a Member as part of such Member's Initial Capital Contribution is the amount of such Mcmber~s Initial Capital Contribution, as set !Orth on Exhibit A, minus the amount of any cash contributed lo lhe Company as pa1·t of such Member's Initial Capital Contribution. In all other cases, the Fair Value of an asset as of any date is its fair market value as detennined by the Board of Managers in good faith using any reasonable valuation method. ff any affected Member does not agree with the valuation set by 1hc Board of Managers, the Fair Value shall be determined using procedures similar to those set forth in Section 14.2, and the cost of any such determi11ation shat! be borne entirely by the atfoctet:l Member unless the Board of Managers or a Majority-in-fnterest of all Members other than (he ~ffected Member approves an alternative allocation of such costs, 14.2, Purchase Price of Membership Interest. {a) For purposes of any redemption of a Membership fntcrest pursuant lo Section 10.3(c}, the purchase price shall be the Triggering Event Purchase Pl'ice. (b) If the Offering Member and the Company cannot cooperatively designate an appraiser within 15 days following the date of the Redemption Notice, then the Offering Member and the Company shall each select an appraiser, and such two (2) appraisers shall select a third llPlWaiser who shall select the appraiser to perfoml such appraisal. The cost of each appraisal shall be shared equally by the Company and the Offering Member. 14.3. Valuation of Membership lnterests. For all purposes of this Agl'eement other than the valuation of Membership Interests in connection with a Triggering Event, the fair nrnrket vuf lie of the Membership Interests shall be determined by the Managers pursuant to an independent third pal'ty appraisal of the assets of the Company. The l3oard of Managers shall no less than annuafly cause the assets of the Company to be uppraised by an independent third party. ARTICLE XV GENERAL PROVJSJONS 15.1 . Amendments. (a) In General. Su~ject to the following exceptions and limitations, thi s Agreement may be amended only with the wtittcn approval of all Members. (b} Exceptions an/33032101011091114 MR.578 SEP/ l l/2014/THU l l: 15 PM BALLENGEE INTEREST FAX No, 31S-42g-7t03 P. 002 Executed as ofthe Effective Date set i above, by and axno.og the petsons signing below. 1\1EMBERS: CENTURION liOGISTICS :LLC MANAGER: COMPANY AGRl!f!MENT OF ~Nhco.sn ,u,LLC PAGE 29 MR.579 COMPANY AGREEMENT OF CENTURION PECOS TERMINAL LLC EXIIJBIT A MEMBERS' CONTRIBUTIONS AND PERCENTAGE INTERESTS Effective as of the Effective Date Initial Ca pital Initial Percentage MEMBEH NAME AND ADDRESS Contribution I aterest Centurion Logistics LLC $400.00 40.00% J 7950 Preston Road Suite 1080 Dallas, Texas 75252 CAM Oil and Natural Gas, LLC $600.00 800 Spring Street Suite 205 Shreveport. Lm1isirolit. COMPANY AGREEMENT OF C£'1TllHl()i\' l' t: :cn s T EHt\11 ',\I. LLC 6211457.1/SP/33032/0101/091114 MR.583 and (iii) the amount of any Company Jiabililies assumed by such Member or that arc secured by properly distributed to such Member. (b) The Capital Account of each Member shall be debited by (i) the amount of cash and the Fair Value of propc11y distrihuted co such Member, (ii) such Member's share of the. Company·s Net Loss, and (iii) the amount of any liabilities of such Member assl11r1ed by the Company or lhal arc secured by any property contributed by such Member to the Company. (c) Upon the transfer by a Member of all or purt of an interest in the Company after the Etlective Date, the Capital Account of the transferor that is auributable to the transfrrred interest carries over to the transferee and the Capital Accounts of the Members shall be adjusted to the extent pt:ovidcd in Treasury Regulations Section l.704- l(b)(2)(iv)(m). (d) In determining the amount of any liabi!i{y for purposes of Sections A.3(a) and A.3(b), I.R.C. Section 752(c) nnd any other applicable provisions of the 1.R.C. and the Treasury Regulations shall be taken into account. (e) Except as otherwise required by Treasury Regulations Section l.704- l(b)(2)(iv), adjustment to Capital Accounts in respect' of Company income. gain, loss, deduction. and l.R.C. Section 705(a}(2)(B) expenditures (or items tliereot) shaJJ be made with reference to the federal tax treatment of such items (and, in the case of book items, with reference to the federal tax treatment of the corresponding tax items) al the Company level, without regard to any mandatory or electiw tax treatment of such items at the Member level. (t) The provisions of this Appendix nnd of the Agreement relating to the maintenance of Capital Accounts are intended to comply wilh Treasury Regulations Section l.704-l(b)(2)(iv), and shall be interpreted and applied in a manner consistent with such Treasury Regulalions. ff the Board or Managers determines that it is prudent to modify the mairner in which the Capital Accounts, or any debits or credits thereto (including debits or credits relating to liabilities that are secured by contributions or distributed propc1ty or that are assumed by the Compru1y or any Member): are computed in order to comply with such Treasury Regulations, the Board of Managers may make such modi fl<:ation if it is not likely to have a material effoct on Lhe amounts distributed or to be d;stributed to any Member pursuant to the Agreement. The Board of Managers shall make any adjustments that are necessary or appropriate (i) to maintain equality between the Capital Accounts of the Members and the amount of Company capital reflected on the Company's balance sheet, ~IS computed for book purposes, in accordance with Treasury Regulations Section L704-I (b)(2)(iv){g}. nnd (ii) if unanticipated events (for example, the acquisition by the Company of oil or gas properties) might otherwise cause iJ1is Agreement not to comply with Treasury Regulations Section 1.704-l(b). (g) The provisions of the proposed Treasury Regulations published on January 22, 2003 (68 Fed. Reg. 2930}, as they may subsequently be modified or adppted as temporary or final Tn.:asury Regulations. shall apply with respect to any noncompcnsatory options issued by the Company. A.4 Allocations of Net Profit and Net Loss AA. l In General Aner giving effect to the special allocations set forth in Sections A.4.2 and A.4.3 hereo[ Net Profit and Net Loss (and to the extent necessary. individual items of income, gain, loss. or dcductio11) fo1· COMPANY AGREEMENT OF CtNTl!RIOt'i PJ·:cos Tf.:rU·ll~Al. LLC PAGEA-5 6211457.11SP/3303210101/0S1114 MR.584 any period shall be allocated to the Members in such amounts as may be necessary to cause each Member's Capital Account (as adjusted through the end of such period) lo equal, as nearly as possible, the sum (which may be either a positive or negative amount) of li) the amount such Member would receive if all Company assets on hand at the end of such period were sold for cash at their Gross Asset Values, all Company liabilities were satisfied in cash according to their terms (limited in the case oJ any Nonrecourse Liability and Partner Nonrecourse Debt to the Gross Asset Value of the property securing such liabilities), all obligations (if any) of Members to contribute additional capital to the Company were satisfied, and any 1·emaining cash was distribqted to the Members under Section 4.2 as of the last day of such period, minus (ii) the Member's share of Partnership Minimum Gain and Pa11ner Nonrecourse Debt Minimum Gain computed immediately prior to such deemed sale of assets. A.4.2 Regulatory Allocations. The following special allocations shall be applied in the order in which they are Jisted. Such ordering is intended lo tomply with the ordering rllles in Treas~1ry Regulations Section l .704<~(1) and shall be applied consistentlyiherewith. (a) Minimum Gain Chargeback. Except as otherwise provided in Treasury Regulations Section 1. 704~2( f). anything to the contrary in this Section A.4 notwithstanding, if there is a net decrease in Partnership Minimum Gain during any taxable year, each Member shall be allocated items of income and gain for that taxable year (and. if necessary. subsequent taxable years) equal to that Member's share of the nel decrease in Partnership Minimum Gain deteJmincd in accordance with Treasury Regulations Section 1.704-2(g)(2). This Section A.4.2(a) is jntended to comply with lhe minimum g'1in chargehack requirement in Treasury Regulations Section l . 704~2(1) and shall be interpreted consistently therewith~ including that no chargeback shall be required to the extent the requirements for requesting a waiver described in Treasll1·y Regulations Section J .704-2(t)(4) are met or the requirements for any other exception p1·escribed by or pursuant to Treasury Regulations Section l ,704-2(i) are met. (b) Partner Nonrecourse Debt Minimum Gain Chargeback. Except. as otherwise provided in Treasury Rcgulatjons Section I .704-2(i)(4), anything to the contrary in this Section notwithstanding, if there is a net decrease in Partner Nonrecourse Debt Minimum Gain during a taxable year, lhen, in addition to the amounts. if any, allocated pursuant to paragraph 4.2(a), any Membe1· with a share of that Partne1· Nomecourse Debt Minimum Gain (determined in accordance with Treasury Ref,rttlations Section 1. 704-2(i)(5)} as of the beginning of the taxable year shall be allocated items of Company income and gain for that taxable year (and, if necessary. for subseqLJent taxable years) equal to that Member~s share of the- net decrease in the Partner Nonrecourse Debt Minimum Gain, detennined in accordance with Treusury Regulations Section L704-2(i)( 4). This Section A.4.2(b) is intended to comply with the chargeback of partner nonrecourse debt minimum gain required by Treasury Regulations Section l.704-2(i)(4) and shall be .interpreted consistently therewith. including that no chargeback shaH be required to the extent the requirements fo1· any exceptions provided in Treasury Regulation Section l .704-2(i)(4) are met. (c) Qualified Income Offset. If any Member unexpectedly receives any adjustment, allocation, or distribution described in Treasury Regulations Sections 1.704-1 (b)(2)(ii)(d}(4), (5), nr (6), items of Company income and gain shall be specially allocatetl to such Member in nn amount and manner sunicient to eliminate, to the extent required by U1e Treasury Regulatjons, the Adjusted Capital Account Deficit of such Member as quickly as possible. An allocation pursuant to the foregoing sentence shall. be mude only to the extent that such Member would have an Adjusted Capital Account Deficit after all other allocations provided for in Section A.4 have been tentatively made as if this Section A.4.2(c) were not In this Appcndlx. This allocation is intended to const11ute a "quulitied income COMPANY AGREEMENT OF C!>:N'IH~I()~ l'l·:cos TE\t:\llSAL LLC PAJ1'~t, t'~ .._ DEED OF TRUST ... ~: 'H" a! H ·? IJ-ttllAtf RECORDATION REQUESTED BY: Tnu c..,n.1 S.nk, National Ae8ocl•llon Pl'Hller Olflee, Commerclal S.nldng 5910 N, Central Expruaway, Sulle 150 O.llu, TX 75206 WHEN RECORDED MAIL TO: Texu Cepltel Blink, ~llo"el Aeaocletlon Attn : l.oen Openlllona v 2350 LAlc!er lalso k,nown as Beneflclaiy in thTs Deed of Trust) all of Grantor's right, ti1le, and interest in and IQ all p<689nt and Mure leases ol the Property and all Renls from the Property. In addition, Granlot grants to I.ender a Uniform Commercial Code securily lnlerest In the Personal Plope11y and R11<1ts. THIS DEED OF TRUST, INCLUDING THE ASSJQNMENT Of RENTS AND THE SECURITY INTEREST IN THE RENTS .\ND PERSONAL PROPERTY, IS GIVEN TO SECURE (A) PAYMENT OF THE INDEBTEDNESS AND (B) PERFORMANCE OF ANY AND AU. OBLIGATIONS UNDER THE NOTE, THE A.ELATED DOCUMENTS, ANO THIS DEED Of TRUST. TiiJS DEEO OF TRUST IS GIVEN AND ACCEPTED ON TllE FOLLOWING TERMS: GRANTOR'S REPRESENTATIONS AND WARRANTIES. Grantor warrants that: (a) this Deed of Trust Is e~eeuted at Borrower's request and nol al the request of Lender. (b) Granlor has Iha lull power, right, and aulhorily to 81\ler fnto lhl$ Deed of Trust end lo hypothecate the Property: (o) the provisions of this Deed ol Trust do not conlllct wllh, or r6St.llt in a detaUlt under any agreement or other 1nstrument binding upon Granlor nnd do not result In a violation of any law, regulatlon. court decree or order applicable to Grantor, (d) Granlot has eslllblishcd adequoto means ol obtalnihg from Borrower on a coollnulng basis infonnalion about Borrov/o(s Hnanclal condition: end (e) Lende! hes made no representation to Gran1or aboul BorroWer (Including wtthout llmilatlon the credltwonhlness of Borrower). GRANTOR'S WAIVERS. Granlor wa1ves all rights or ootenses wing by reason of any •one action• or ·anll-dellcfency• law, or any olher law which 1'(18Y prevent i..eN:klr from bringing any aclion 11galnst Grantor, 1nolvding a claim lor deficiency to the exlent Lender rs olherwin entitled to a claim tor deficiency, befote or altar Len!OOOadlno Is oom re .m ~t would materially affect l.&ndet's Interest In the Ptoperty IX if Grantor !alls Lo corT91y with rN'fY prol.'iSilon ot this Oeed of Trust or any Rela!Bd Documents, lnctu:!ing but not limited to Grantor's lafttJre lo clischa.rge or MR.592 BALLENGEE00002065.02 DEED OF TRUST (Continued) Page 3 pay when di.le any amOUl\ts Grantor is requfred lo discharge or pay under this Deed ot Trust or any Relal&d Documents, Lender on Granto~s behaH may (but shalt not be obligated lo) talce any acuoo that Lendef deems appropriate, inciudlng but .not limited to dOVe, Granior warrants and will lorover defend the tlt11> to the Propeny agaTnsl the Jawlul chtlms ot all persons. In the eve111 any ac~on or ptoceedlog IS commenced that quesllons Grantor's title or the Interest ot ·t Trustee or Lender under 1hls Deed ol Trust. Grantor sha~ defend the action at Grantor's expense. Grantor may be lhe nominal party In 0 such proceeding, but Lenoer shal be entitled to panlc!pate in the proceeding and to be represented In the proceeding by counsel or Lende(·s own oholoe, and Granlor wnt deliver, or causa to be deUvered, to I.ender sucti Instruments as Lender may request Iron\ time to 9 Ume to permit such participation. Compll•nc• With L1wt. Grantor warri1nts that the Property arid Granto(s use or lhe Property complies wllh all existing appnca1>1e laws, on:llnances, and regulallo11s of governmental authorities. Survtv•I of Repruentatlona and W1m1nUH. All representations, warrannes, and E19reemenls made by Granter In this Deed of Trust stlall SUfVlve 1he execution and delivery of this Deed or Trust, shail be continuing in na.turo, and stiall romain in lull lorce and effect untn sucn time as BoODedlng 1n coodermatlon Is IUed, Granier shall promptly noUfy Lender In writing, and Grantor shall pl'Ower or Granter. Compll1nce Default. Failure to comply wllh illlY other lenn , obligation, covenant or condition contained In thrs Deed ol Trust, the Note or Tn any of lhe Related Documents. Detaull °"Other Psy11l9111a. Failure or Granier within lhe tlrrie requfred by this Oeod of Trust \o make any payment ror 1ues or Insurance, or any other payment necessary to prevent ntlng or or to effect discharge of 811Y Uen. O.f1ull tn Favor of Third Partle1. ShoiAd Borrower or any Granter dafautt under any loan. extension ot credlt. Hcuril)I agreement. purcho.so or sales agreement. or any other agreomont, In favor ot any other oroditor or parson lliat may mater;elty erfecl any of Borrower's or any GranlO<'s property or sorrower's ability lo repay the Jndebledness or Borrower's or GranlO(s ablllty to perform tnelr reSJ)OOlive obligations under this Deed or Trusl or any ol the Relaled Documents. MR.593 BALLENGEE00002065.03 DEED OF TRUST (Conti nued) Page 4 FeJN Sllltemtnta. MY warranty, representallon or sta1ement made or furnished to Lender by Borrower or Grantor or on 'Borrower's or Grantor's behalf uodor 11116 Deed of Trull! or lhe Relaled Oocumenis Is false or misleading In arry material respect, either now or at lhe 1lme made or flmfshed or becomes false or rnlSleading at any tima thereafter. Defective Collal8'allutlon. This Deed of Trust or eny of the Aelaled Ooouments ceases to be In fl.Ill force and elfect (lnofUdln9 failure ol any collateral document to ereate a valid and per1ecled seourlty lnteresf or lien) at any time and tor ar,y reason. °' Death fneolW11q!. The dlssolution ol Grenier's (regardless of whelhar elecUon to continue Is made). any mem~r wllhdraws from the V limited liability company, or any ott1er lermlneUoo of Bollower's or Grantor's existence as a going bUsiness or ll'le death of any mem)>er, the Insolvency of Borrower or Grenior, lhe appolnunent or a receiver for any pan of Borrower's or Grenier's property, any asslgnmenl lor lhe 0 benern or credllors. any type of creditor workoul, or the commencement of any proceeding L6lder any Dankruplcy or Insolvency laws by or L a9ainst Borrower or Grantor. Creditor or Forlallur• Proeoodlnga. Commel'ICemenl of loreclosure or lorfeilure prO(:eed\ngs, whether by Judlc:Jel proceeding, sell-help, tepoSSesslon or any other method, by any eredllor of Borrower or Granter or by any governmenlal agency againsl any property securing the lndebledness. 11ils Includes a garnishment of any of Borrowo(s or Granlofs accounls, lncl\Jdlng depoSlt eocounts, with Lender. However, this Evoot of Oefaull shall not apply 1f !~ere is a good faith od by Lendor. 1 in Its sole diScfeUon, as being an adequale reserve or bond for the dispute. BrMch ol Ot.her AgrNment. Any breach by Borrower or G'8ntor under the terms ol 1J11Y other agreement between Borrower or Granlor end 0 Lender that Is not remedied wnhtn any grace pertod provided therein. Including wi!hout limitation any agreement conceming any 9 Indebtedness or other obligation of BofTOwer or Grantor to l..ondef, wh91her existing now or later. Event• AlfectlnO Guarantor. Any of the .preceding events occurs with respect to any Guarantor of any ol the Indebtedness or aT"'J Guarantor dies or becomes lncompalent, or revOkes or disputes the valldlty of, or llabllily under, any Guaranty ol the Indebtedness. AdvffM Cnange. A rmtatlal iw::lll'erse ctianoe occurs In Borrower's or Gmntor's flnancial oonditlon. or Lender ~laves the prOSpecl ol payment or performance 01 lhe lndeblediess Is lfT1;!aired. lnucurily. Lender In good fallh believes 11self Insecure. Right to Cure. II any Clefa.ult. otner than a default in payment is curable, lt may be oured 11 Grantor, alter Lenaer sends written notice lo p Borrower demanding cu(e -of such default: (1) cures the default withln ten (10) days; or (2) If tho cure requires mofe lhan ten (10) da~. lmrnedialely irillletes steps' whloh Lender deems in Ler.dets sole dlscrellon to be sulflcrent lo cule the delault and thereafter conllnues and G ocmpletes ell c'easonable and necess&ry steps sufficiont lo produce ocmpllancG as soon as reasonably practical. RIGHTS ANO REMEDIES ON D:EFAULT. II an Evs1t of Default occurs under this Deed of Trust, at any time thereafter, Trustee or t..erlier ~ exen:ise any one or more ol lhe lollowirig tights and remedies: Election of Remedlee. Bec~oo by Lender lo pursue any remedy shall not exclude pursull or any olher remetly, anllgalion as lessor or landlord wtth respect lo any occupant of the Property. fients so recellled shall be applied by Lender first 10 the remaining L6lpald balance ol the Indebtedness, In suet> otdef or manner as Lender shall elect, and the residue, 11 any, shall be paid to the person or persoris legally e11tlUed 10 lhe Cpl9S&ly walves all darreges sustained by reesai thereo<. Other Remedlee. Trustee or Lender shall have any other r1ght or remedy provided In thls Deed ot Trust or the Nota or tjvallable at law or in equity. Salo of the Property. To ttie e>dent permitted by applloable law, Borrower and Granlor hereby waives MY and all righla to t>avc lho Property marshalled. lo e1$ a matter of law, Trustee shall have the power to la~e the following actions with respect to 111ti Property upon the written request ot lander and Granter. (a) Join in preparing and fifing a map or plat of the Real Property. including the dedication of streelS or other rights to the public; (b) Join In granting any easement or creeling any restriction 1 on the Real Property; and (c) jOln In any subordination or other agreement attectlng this Deed of Trust or the Interest ol Lender under this 1 Deed of Trust. Obllg1Uon1 lo Notify. TnJ'51ee shall not be obligated to notify any other Menhdder ot 01e Property ol the commencement of a foreclosure 0 proceeding or of the commencement of any other 11ction to which Loncler may 11va11 Jtsetf as a remedy, except to the extent reQuired by 9 11pplic:6ble law or by wr1tten agreement. TruatM. In addition to the rights and remedies set forth anove, with l espect lo all 01 any j)Brt of the Property, ihe Trustee shall have the right to roreclose by notioe snd sale, and Lender shall have \ho right to toreclose by Judicial foreofosure, In either case In accordance with and to the lull e"1ent provided by appllcabte law. Subatllute Tr111tae. Lender, at Lende(s opllon, trom time to time. and more than once, may appoint ln wrltlng 11 successor or· substitute trustee. with or without ca1.1Se. lnciudlng the res(gnelion, 11bsence1 doath. inabililY. refusal or laUuro 10 ac1 ot the Trustee. The successor or substllu\e trustee may be appointed wlthout ever requiring the resi9nation of the former trustee and Without any lormanty except tor the execuUon and acknowlodgmont of the appolntme111 by the l)eneOciary of ttils Deed of Trust. The successor or sllbstltute trustee snail then p succeed lo ell rights, ot>li!laJlons, and duties of the Trustee. Ttlls appointment may be made on Lender's behatt by the President, any V\ce G PreslOO right otherwise to demand strict comp!lanoe with that provlskln or eny other provision ol thls Deed of Trust. No pr.or waiver by I.ender. nor any course ot deallng between Looder and Granier, shall constitute a waiver ol any of Lenders rights or of any or Grantor's obOgations as to any future transactions. Whenelll!f the QOnsent of Lender is required lXlder this Oeed or Trust, the granting of such consent by l.eJ1det in aI1Y (flstance sl'lall not conslltute cootlnuing consent to SUbsequent Instances where such consent Is required and In all cases such consent may be granted or withheld In the sole discretion or Lender. Payment of tnt9feal and f - . Notwithstanding Olly other provision of this Deed of Twst or arrv provision of any Related Oocumen~ Granlor does nOI agree Of li1lijrid to pay, and I.ender does not agree or Intend to charge, collect, tntco, RlSente or receive (coWactlVely referred to ha

in Re: John Calce

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