20-101386-LLC Operating Agmt-04-13-2022-V1OPERATING AGREEMENT OF
FEDERAL WAY PARCEL A, LLC,
a Delaware limited liability company
This Operating Agreement ("Agreement") of Federal Way Parcel A, LLC, a Delaware
limited liability company (the "Company"), is made and entered into as of May 3, 2021 (the
"Effective Date"), by and between Holdings Federal Way, LLC, a Delaware limited liability
company (the "Member") and Holdings Federal Way Manager, LLC, a Delaware limited liability
company (the "Manager"), and any other member or manager admitted pursuant to this Agreement.
NOW, THEREFORE, in consideration of foregoing recitals, and the mutual promises,
covenants and agreements contained herein, the Member and the Manager do hereby promise,
covenant and agree as follows:
1. DEFINITIONS. Certain terms and words used in this Agreement shall have the meanings
set forth below in addition to those words defined in the Glossary of Terms attached to this
Agreement as Exhibit "A" and made a part hereof.
"Company" means Federal Way Parcel A, LLC, a Delaware limited liability company.
"Effective Date" means May 3, 2021.
"Manap-er" means Holdings Federal Way Manager, LLC, a Delaware limited liability
company, or any successor appointed by a Required Majority of the Members.
"Member" means Holdings Federal Way, LLC, a Delaware limited liability company.
"Property" means that certain parcel of real property, improvements thereon and personal
property associated therewith, located at Lot 6 of City of Federal Way boundary line adjustment no.
17-100484-SU, recorded under recording no. 20171103900001, in King County, Washington, and
any other assets used in connection with the ownership and operation of such property.
2. ORGANIZATION.
a. Agreement. The Manager and the Member of the Company hereby enter into this
Agreement pursuant to the provisions of the Act to establish the respective rights, duties and
obligations of the Company, the Member, the Manager and any future Members of the Company.
b. Place of Business. The mailing address of the Company shall initially be 4020
Kinross Lakes Parkway, Suite 200, Richfield, Ohio 44286. The principal place of business of the
Company shall be at the property and may be changed from time to time by the Manager in its
discretion.
C. Term. The term of this Agreement shall commence on the Effective Date and shall
continue thereafter in perpetuity unless this Agreement is terminated as herein provided.
d. Re uired or Permitted Filin s. The Manager shall cause such documents as may be
required or permitted by the Act and/or any other applicable law, rule or regulation for the formation
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of the Company and the operation of its business consistent with the purposes of this Agreement to
be prepared and filed with the appropriate authorities. The name and address of the initial agent for
service of process on the Company shall be designated and may be changed from time to time by the
Manager.
e. Purposes. The purposes of the Company are:
Property;
(i) to own, hold, lease, operate, manage, maintain, develop and/or improve the
(ii) to hold the Property for the production of rental and other income;
(iii) to hold the Property for investment and long-term appreciation, and to
ultimately sell, exchange or otherwise dispose of the Property;
(iv) to sell, transfer, exchange, convey, dispose of, pledge, assign, borrow money
against, finance, refinance or otherwise deal with the Property; and
(v) to engage in any lawful act or activity and to exercise any powers permitted to
limited liability companies organized under the laws of the State of Delaware that are related or
incidental to and necessary, convenient or advisable for the accomplishment of the above -mentioned
purposes.
The Company, and the Member, or any Manager on behalf of the Company, may enter into
and perform their obligations under all documents, agreements, certificates, or financing statements
contemplated thereby or related thereto, all without any further act, vote or approval of any Member,
Manager or other Person, notwithstanding any other provision of this Agreement, the Act or
applicable law, rule or regulation. The foregoing authorization shall not be deemed a restriction on
the powers of the Member, the Manager or any director or officer to enter into other agreements on
behalf of the Company.
g. Ccrtificates. The person designated as an "authorized person" within the meaning of
the Act, has executed, delivered and filed the Certificate of Formation of the Company with the
Secretary of State of the State of Delaware. Upon the filing of the Certificate of Formation with the
Secretary of State of the State of Delaware, his powers as an "authorized person" ceased, and the
Member thereupon became the designated "authorized person" and shall continue as the designated
"authorized person" within the meaning of the Act. The Member or Manager shall execute, deliver
and file any other certificates (and any amendments and/or restatements thereof) necessary for the
Company to qualify to do business in the state in which the property is located and in any other
jurisdiction in which the Company may wish to conduct business. The existence of the Company as
a separate legal entity shall continue until cancellation of the Certificate of Formation as provided in
the Act.
3. MANAGEMENT. The Company shall be manager managed. The responsibility for the
management and operation of the Company and its business shall be vested in the Manager.
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4. MEMBERSHIP.
a. Members. The name, address, and Member Percentage of each Member is set forth
on an Exhibit `B" attached to this Agreement and made a part hereof. Exhibit `B" shall be amended
from time to time to reflect any changes to the information contained therein.
b. Admission of Additional Members. Except as set forth in this Agreement, Additional
Members may be admitted to the Company only with the prior written consent of a Required
Majority of the Members.
5. CAPITAL CONTRIBUTIONS.
a. Contribution to Capital by Members. The Member shall make Capital Contributions
in cash or property as determined by the Member with the consent of the Manager. The Member
shall have a Member Percentage of 100%.
b. Limitation on Additional Contributions. No Member shall be permitted or required to
make additional Capital Contributions to the Company beyond those described in Paragraph 5.a,
unless the consent of a Required Majority of the Members is first obtained. All additional Capital
Contributions shall be made by the Members pro rata in accordance with their respective Member
Percentages, unless the Members unanimously agree otherwise.
C. Limited Liability. The debts, obligations and liabilities of the Company, whether
arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the
Company. No Member of the Company shall be obligated personally for any debt, obligation or
liability of the Company solely by reason of being a Member of the Company.
d. Withdrawal of Cavital. No Member shall have the right to withdraw or receive a
return of any Capital Contribution, and no Capital Contribution may be returned in the form of
property other than cash, except as otherwise specifically provided in this Agreement.
e. Interest on Capital. No Member shall be entitled to receive any interest on its Capital
Contributions or on any positive Capital Account balance, except as otherwise provided in this
Agreement.
6. DISTRIBUTIONS AND ALLOCATIONS.
a. Distribution of Cash Flow. Cash Flow shall be distributed to the Members pro rata in
accordance with their respective Member Percentages.
b. Allocation of Profits and Losses. Profits and Losses for any taxable year shall be
allocated among the Members pro rata in accordance with their respective Member Percentages.
C. Tax Allocations. All items of income, gain, loss and deduction for federal and state
income tax purposes shall be allocated in accordance with the corresponding "book" items in
accordance with the principles of IRC Section 704(c) and Treasury Regulation Section 1.704-
1(b)(4). If the Members determine that it is necessary or appropriate to modify the manner in which
such tax allocations are allocated under this Paragraph 6 in order to comply with the principles
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reflected in IRC Section 704(c) or such Treasury Regulation, the Members may make such
modifications.
d. Method of Accounting. Profits and Losses shall be computed by use of the cash or
accrual method of accounting, as determined by the Manager and the accountants or tax advisors
retained by the Manager, in accordance with sound tax accounting principles consistently applied,
adjusted to the extent necessary to conform to the applicable provisions of this Paragraph 6 and
Paragraph 7.
7. MAINTENANCE OF CAPITAL ACCOUNTS.
a. Capital Accounts.
i. Capital Account Balances. Throughout the existence of the Company, the
Company shall establish and maintain a Capital Account for each Member. The Capital Account
balance of each Member shall be equal to its Capital Contribution, as set forth in Paragraph 5.a.
ii. Adjustments by Members. The Manager and the accountants or tax advisors
retained by the Manager shall maintain the Capital Accounts of the Members in compliance with the
provisions of Treasury Regulation Section 1.704-1(b), which provisions are incorporated in this
Agreement and made a part hereof. In the event that the Manager determines that it is prudent to
modify the manner in which the Capital Accounts are adjusted and/or maintained in order to comply
with the requirements of such Treasury Regulation, then the Manager may make such modification,
provided that it is not likely to have a material effect on the amounts distributable to any Member
under Paragraph 13 on dissolution of the Company.
iii. Adjustments Where Guidance _ is Lacking. If the provisions of this
Paragraph 7 or Treasury Regulation Section 1.704-1(b) fail to provide guidance as to how the
Capital Accounts of the Members should be maintained to reflect particular adjustments to Company
capital on the books of the Company, such capital adjustments shall be made in a manner that:
(1) maintains equality between the aggregate governing Capital Accounts
of the Members and the amount of Company capital reflected on the Company's balance sheet;
(2) is consistent with the underlying economic arrangements of the
Members; and
(3) is based, wherever practicable, on federal income tax accounting
principles.
b. Basic Rules for Capital Account Entries.
i. The Capital Account of each Member shall be determined strictly in
accordance with the rules set forth in Treasury Regulation Section 1. 704-1 (b)(2)(iv).
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ii. Subject to Paragraphs 7(a) and 7(b)(i), a Member's Capital Account shall be
increased by:
(1) the amount of money contributed by the Member to the capital of the
Company;
(2) the fair market value of the property contributed by the Member to the
capital of the Company (net of liabilities secured by the contributed property that the Company is
considered to assume or take subject to under IRC Section 752); and
decreased by:
(3) the amount of Profits allocated to the Member.
iii. Subject to Paragraphs 7(a) and 7(b)(i), a Member's Capital Account shall be
(1) the amount of money distributed to the Member by the Company;
(2) the fair market value of property distributed to the Member by the
Company (net of liabilities secured by such distributed property that the Member is considered to
assume or take subject to under IRC Section 752);
(3) the Member's share of the Company's IRC Section 705(a)(2)(B)
Expenditures, including losses which are nondeductible under IRC Sections 267(a)(1) or 707(b);
(4) the Member's share of amounts paid or incurred by the Company to
organize the Company, except to the extent properly amortizable for federal income tax purposes;
and
(5) the amount of Losses allocated to the Member.
8. ADMINISTRATIVE AND ACCOUNTING MATTERS.
a. Books and Records. The Manager shall keep the following Company documents at
the principal office of the Company:
a current list of full name, last known address, and Member Percentage of
each Member;
ii. fully -executed copies of this Agreement and all amendments to this
Agreement;
iii. copies of the Certificate of Formation of the Company and all amendments
thereto;
iv. copies of the federal, state and local income tax or information returns and
reports of the Company, if any, for at least the six (6) most recent taxable years;
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V. financial statements of the Company for at least the six (6) most recent fiscal
years; and
vi. the books and records of the Company for at least the current and past six (6)
fiscal years.
b. Delivery to Members and Inspection. Each Member has the right to inspect and copy,
during normal business hours, any of the Company's records required to be maintained under
Paragraph 8.a. Within ninety (90) days after the end of each taxable year of the Company, each
Member shall receive a copy of the federal and state income tax returns of the Company and the
information necessary for the Member to complete its federal and state income tax or information
returns.
C. Tax and Fiscal Year. The tax and fiscal year of the Company shall be the calendar
year.
d. Tax Matters Partner. The Manager shall be the Tax Matters Partner (as defined in
IRC Section 6231) to represent the Company (at the Company's expense) in connection with all
examinations of the Company's affairs by tax authorities, including resulting judicial and
administrative proceedings, and to expend Company funds for professional services and costs
associated therewith. A Required Majority of the Members may select a replacement or successor
Tax Matters Partner at any time.
9. MANAGEMENT AND RELATED MATTERS.
a. Control by Manager. Subject to the consent, voting and other approval rights
expressly granted to the Members under this Agreement and the Act, the Manager shall have sole
and exclusive control over the business and affairs of the Company and shall have all of the rights
and powers which may be possessed by a member or a manager under the Act (including, without
limitation, incurring debt and acquiring and disposing of property). Neither the Manager nor the
Members are required to hold meetings.
b. Specific Authority, Powers Duties of Manager. The Manager shall have the specific
rights, powers and duties required for or appropriate to management of the Company's business,
including, but not limited to, the right and power to endorse checks, drafts, and other evidences of
indebtedness made payable to the order of the Company. All checks, drafts, and other instruments
obligating the Company to pay money may be signed by the Manager, except in those instances in
which the contract or obligation must be approved by a Required Majority of the Members. The
Manager is authorized to sign contracts and obligations on behalf of the Company, except in those
instances in which the contract or obligation must be approved by a Required Majority of the
Members.
C. Officers. The Manager may from time to time appoint officers of the Company and
delegate to such officers such authority and duties as the Manager may deem advisable. The
Manager may assign titles (including, without limitation, Chairman, President, Vice President, Chief
Executive Officer, Chief Financial Officer, Chief Technology Officer and Director) to any such
officer. Any individual may hold any number of offices. The officers shall serve at the pleasure of
the Manager, and any officer may be removed by the Manager at any time, subject to all rights, if
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any, of an officer under any contract of employment with the Company. The officers shall exercise
such powers and perform such duties as specified in this Agreement or as determined from time to
time by the Manager. .
d. Limitations on Power of Manager. The Manager shall not have the authority
hereunder to engage in or cause the Company to engage in any of the following transactions without
first obtaining the consent of the Required Majority of the Members:
Company;
i. the purchase of assets not in the ordinary course of the business of the
ii. the purchase by the Company of any Member's Member Interest;
iii. the transfer or encumbrance of any Member's Member Interest;
iv. changing one or more of the principal purposes of the business of the
Company as set forth in Paragraph 2.e.
e. Prohibited Acts of Manager. The Manager shall not have the authority to do any act
prohibited by law or any authority to:
i. permit any creditor who makes a nonrecourse loan to the Company (whether
or not such loan has been approved by a Required Majority of the Members) to acquire, at any time
as a result of making such loan, any direct or indirect interest in the profits, capital or any asset of the
Company other than as a secured creditor; or
ii. permit the Company to be charged with any overhead or salaries of the
Members or any of their Affiliates, except as otherwise permitted under this Agreement.
f. Fiduciary Obligations of Manager. The Manager shall be under a fiduciary duty to
conduct the affairs of the Company in the best interests of the Company and the Members. The
Manager shall have a fiduciary responsibility for the safekeeping and use of all Company funds and
assets, whether or not in its possession or control or under its management, for the exclusive benefit
of the Company. Neither the Manager, nor any Member, nor any Affiliate of the Manager or any
Member shall enter into any transaction with the Company which may significantly benefit the
Manager, any Member, or any Affiliate of the Manager or any Member in their independent
capacity, unless the transaction is expressly permitted under this Agreement or approved by a
Required Majority of the Members.
g. Devotion of Time of Managg . The Manager shall not be obligated to devote full
time to the business and affairs of the Company. The Manager is and/or may become involved in
other businesses, occupations and entities during the existence of the Company. During the term of
the Company, the Manager shall devote such reasonable amounts of time as it determines, in its
discretion, to be necessary to manage the Company's business and affairs and perform the duties of
the Manager under this Agreement.
h. I'aymelits to Marlagcr. Except as set forth in this Agreement, neither the Manager nor
any Affiliate of the Manager shall be entitled to remuneration for services rendered to the Company.
The Manager and its Affiliates shall receive only the following payments:
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i. The Company may pay the Manager and/or its Affiliates for services rendered
or provided to the Company to the extent that the Manager is not required to render such services
without charge to the Company, and to the extent that the fees paid to the Manager or Affiliate do
not exceed the fees that would be payable to an independent responsible third party that is willing to
perform such services or provide such goods.
ii. The Company shall reimburse the Manager and/or its Affiliates for out-of-
pocket expenses incurred in connection with organizing the Company, preparing this Agreement,
acquiring and operating Company assets, and administering the Company.
i. Bank Accounts. The Manager shall maintain the funds of the Company in one or
more separate bank accounts in the name of the Company and shall not permit the funds of the
Company to be commingled in any fashion with the funds of any other Person.
j. Successor Manager. A Required Majority of the Members may terminate the
Manager and select a successor Manager at any time with or without cause.
10. LIMITATIONS ON LIABILITY; INDEMNIFICATION.
a. Limitation on Liability. The Manager shall not have any liability, responsibility or
accountability in damages or otherwise to any other Member or to the Company for losses, damages,
penalties, actions, suits, proceedings, judgments, costs, expenses, or disbursements of any kind or
nature whatsoever ("Damages") arising out of any action or inaction on the part of the Manager, any
Member, or the Company other than the Damages resulting from the Manager's own fraud, gross
negligence, criminal act or breach of fiduciary duty to the Company or any other Member.
b. Indemnification. The Company (or its receiver or trustee) agrees to indemnify, pay,
defend, protect, and hold the Manager harmless from and against any and all liabilities, obligations,
losses, damages, penalties, actions, suits, proceedings, judgments, costs, expenses, and
disbursements of any kind or nature whatsoever, including, without limitation, all costs and expenses
of investigation, defense, appeal and settlement ("Indemnity Damages") of any and all suits, actions,
claims, or proceedings instituted against the Company, the Manager, or any Member in any way
relating to or arising out of, or alleged to relate to or arise out of, any action or inaction on the part of
the Manager, any Member, or the Company other than the portion of the Indemnity Damages
resulting from the indemnified Person's own fraud, gross negligence, criminal act or breach of
fiduciary duty to the Company or any Member.
C. Survival. The provisions of this Paragraph 10 shall survive any termination of this
Agreement.
11. LIMITATIONS ON MEMBERS. No Member shall have the right or power to:
(a) withdraw or reduce Capital Contributions, except as the result of the dissolution of the Company
or as otherwise provided by law or this Agreement; (b) cause the termination or dissolution of the
Company, except as set forth in this Agreement; or (c) demand or receive property other than cash in
return for Capital Contributions. No Member shall have priority over any other Member either as to
the return of capital, profits or distributions. Other than on dissolution of the Company, there has
been no time agreed on when the Capital Contributions of any Member will be returned.
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12. TRANSFERS OF MEMBER INTERESTS.
a. Resignation. The Member may not resign, unless an Additional Member is
simultaneously admitted to the Company pursuant to this Paragraph 12. If the Member is permitted
to resign pursuant to this Paragraph 12, an Additional Member of the Company shall be admitted to
the Company, subject to Paragraph 4[12), upon its execution of an instrument signifying its agreement
to be bound by the terms and conditions of this Agreement, which instrument may be a counterpart
signature page to this Agreement. Such admission shall be deemed effective immediately prior to
the resignation and, immediately following such admission, the resigning Member shall cease to be a
member of the Company.
b. In General. No Member shall transfer or encumber its Member Interest or any part
thereof without the consent of a Required Majority of the Members (which consent shall not be
unreasonably withheld) and only in accordance with the terms of this Paragraph 12. The transferee
in any transfer not in compliance with the requirements of this Paragraph 12 shall possess only an
economic interest in the Company, and, accordingly, shall be entitled to receive only the share of
profits, distributions, and the return of Capital Contributions to which the holder of the transferred
interest would have been entitled. Any act in contravention of any provisions of this Paragraph 12
shall be null and void as against the Company and the other Members.
C. Specific Restriction on Transfer of Member Interests. Each Member hereby agrees
not to transfer any portion of its interest in profits and capital in any way that would cause a
constructive termination of the Company under IRC Section 708. The transferor Member whose
transfer of an interest in the Company causes a deemed termination of the Company pursuant to IRC
Section 708 shall pay the cost of any appraisal obtained in connection with a revaluation of the
property of the Company. Notwithstanding the foregoing, or any other provision in this
Paragraph 12, any Member may prohibit the transfer of an interest in the Company, in its sole
discretion, to avoid a constructive termination of the Company under IRC Section 708.
d. Securities Laws.
i. The interests in the Company represented by this Agreement have not been
registered with the Securities and Exchange Commission under the Securities Act of 1933, as
amended, or qualified under the securities laws of any state. Member Interests may not be offered
for sale, sold, delivered after sale, transferred, pledged or hypothecated to any Person unless
subsequently registered and qualified, or, in the opinion of counsel satisfactory to the Members, an
exemption from such registration or qualification is available, and the proposed purchaser of a
Member Interest satisfies the investment suitability standards applicable to the Company.
ii. Each Member agrees that a legend condition may be placed on any certificate
or other document evidencing ownership of a Member Interest, which legend shall be in a form
approved by counsel selected by the Members.
e. Right of First Negotiation. If any Member desires to transfer all or any part of its
Member Interest, except in the instance of a transfer permitted under Paragraph 12.g, such Member
shall notify the Company and the other Members in writing of such desire and, for a period of thirty
(30) days thereafter, the Members and the Company shall negotiate with respect to the purchase of
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such Member's Member Interest. During such period, the Member desiring to transfer such Member
Interest may not solicit a transferee for such Member Interest.
f. Right of First Refusal. If the period described in Paragraph 12.e expires without an
agreement being reached as to the purchase of the Member Interest referred to therein, the Member
desiring to transfer its Member Interest may solicit transferees. In such event, each time a Member
proposes to transfer all or any part of its Member Interest, such Member shall first offer such
Member Interest to the Company and the non -transferring Members in accordance with the
following provisions:
i. Such Member shall deliver a written notice ("Option Notice") to the Company
and the other Members stating (1) such Member's bona fide intention to transfer such Member
Interest, (2) the Member Interest to be transferred, (3) the purchase price and terms of payment for
which the Member proposes to transfer such Member Interest and (4) the name and address of the
proposed transferee.
ii. Within thirty (30) days after receipt of the Option Notice, the Company shall
have the right, but not the obligation, to elect to purchase all or any part of the Member Interest upon
the price and terms of payment designated in the Option Notice. If the Option Notice provides for
the payment of non -cash consideration, the Company may elect to pay the consideration in cash
equal to the good faith estimate of the present fair market value of the non -cash consideration
offered, as determined by the non -transferring Members. If the Company exercises such right within
such thirty (30)-day period, based upon the consent of a Required Majority of the non -transferring
Members, the Company shall give written notice of that fact to the transferring and non -transferring
Members.
iii. If the Company fails to elect to purchase the entire Member Interest proposed
to be transferred within the thirty (30)-day period described in Paragraph 12.f(ii), the non -
transferring Members shall have the right, but not the obligation, to elect to purchase any remaining
share of such Member Interest upon the price and terms of payment designated in the Option Notice.
If the Option Notice provides for the payment of non -cash consideration, such purchasing Members
may elect to pay the consideration in cash equal to the good faith estimate of the present fair market
value of the non -cash consideration offered, as determined by the non -transferring Members. Within
sixty (60) days after receipt of the Option Notice, each non -transferring Member shall notify the
transferring Member in writing of its desire to purchase a portion of the Member Interest proposed to
be so transferred. The failure of any Member to submit a notice within the applicable period shall
constitute an election on the part of such Member not to purchase any of the Member Interest which
may be so transferred. Each Member so electing to purchase shall be entitled to purchase a portion
of such Member Interest in the same proportion that the Member Percentage of such Member bears
to the aggregate of the Member Percentages of all of the Members electing to so purchase the
Member Interest being transferred. In the event any Member elects to purchase none or less than all
of its pro rata share of such Member Interest, then the other Member or Members can elect to
purchase more than their pro rata share.
iv. If the Company and the other Members elect to purchase or obtain any or all
of the Member Interest designated in the Option Notice, then the closing of such purchase shall
occur within ninety (90) days after receipt of the Option Notice, and the transferring Member, the
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Company and/or the other Members shall execute such documents and instruments and make such
deliveries as may be reasonably required to consummate such transaction.
V. If the Company and the other Members elect not to purchase or obtain, or
default in their obligation to purchase or obtain, any or all of the Member Interest designated in the
Option Notice, then the transferring Member may transfer, to the proposed transferee, the portion of
the Member Interest described in the Option Notice not so purchased, provided that such transfer
(1) is completed within thirty (30) days after the expiration of the Company's and the other
Members' rights to purchase such Member Interest, (2) is made on the terms set forth in the Option
Notice, and (3) otherwise complies with Paragraphs 12.a, 12.b, and 12.c.
g. Exempt Transfers. Members may make any of the transfers of their interests in the
Company described in this Paragraph 12(g) without complying with the other requirements of this
Paragraph 12. The transferee shall be substituted as a Member only on compliance with
Paragraph 12.(i), to the extent of the transferred Member Interest. A permitted transfer shall be a
gratuitous transfer to a trust, provided that the transferor Member and such Member's Immediate
Family own more than fifty percent (50%) of the beneficial interests of any such trust. A Member's
"Immediate Family" shall include only the Member's spouse, lineal ancestors and lineal
descendants. Any subsequent sale, assignment, transfer, pledge or other encumbrance
("Disposition") of the beneficial interests in any such trust, which by itself or which, when added to
prior Dispositions of such beneficial interests made after the transfer of the Member Interest to the
trust, equals or exceed more than fifty percent (50%) of the total beneficial interest in the trust, shall
be deemed to be a transfer of the Member Interest owned by the trust for all purposes and shall be
subject to the other requirements of this Paragraph 12.
h. Encumbrance of Member Interests. A Member may encumber its Member Interest,
or any part thereof or an interest therein, only with the consent of a Required Majority of the
Members, which consent shall not be unreasonably withheld or delayed.
i. Substitution of Transferee Member. The transferee of an interest in the Company
otherwise transferred in compliance with this Paragraph 12 shall be admitted as a Member on
satisfaction of the following additional conditions:
i. Filing with the Company a duly executed and acknowledged written
instrument of transfer in a form approved by the Manager, specifying the Member Interest being
transferred and setting forth the intention of the transferor Member that the transferee be admitted as
a Member;
ii. Execution and acknowledgment by the transferor Member and the transferee
of any other instruments required by the Manager, including the acceptance of and adoption by the
transferee of this Agreement; and
iii. Payment to the Company of an amount sufficient to cover the Company's
reasonable expenses in connection with the transfer.
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13. DISSOLUTION OF COMPANY.
a. Events Causinia Dissolution.
i. The Company shall be dissolved and its affairs shall be wound up upon the
happening of the first to occur of the following events (each a "Dissolution Event"):
(1) The termination of the legal existence of the last remaining Member of
the Company or the occurrence of any other event which terminates the continued membership of
the last remaining Member of the Company in the Company unless the Company is continued
without dissolution in a manner required under this Paragraph 13 or permitted by this Agreement or
the Act;
(2) Expiration of the term of the Company; or
(3) Entry of a decree of judicial dissolution pursuant to the Act.
ii. Upon the occurrence of any event that causes the last remaining Member of
the Company to cease to be a Member of the Company or that causes the Member to cease to be a
Member of the Company (other than (A) upon an assignment by the Member of all of its limited
liability company interest in the Company and the admission of the transferee pursuant to Paragraphs
4 and 12, or (B) the resignation of the Member and the admission of an Additional Member of the
Company pursuant to Paragraphs 4 and 12), to the fullest extent permitted by law, the personal
representative of such Member is hereby authorized to, and shall, within 90 days after the occurrence
of the event that terminated the continued membership of such Member in the Company, agree in
writing (x) to continue the Company and (x) to the admission of the personal representative or its
nominee or designee, as the case may be, as a substitute Member of the Company, effective as of the
occurrence of the event that terminated the continued membership of the last remaining Member of
the Company or the Member in the Company.
iii. Notwithstanding any other provision of this Agreement, each of the Member,
the Manager and any Additional Member waive any right it might have to agree in writing to
dissolve the Company upon the Bankruptcy of the Member, Manager or Additional Member, or the
occurrence of an event that causes the Member, Manager or Additional Member to cease to be a
Member of the Company.
b. Winding Up and Liquidation of Com an . On the occurrence of a Dissolution Event,
the Manager shall liquidate the Company assets as promptly as is consistent with obtaining the fair
value thereof and, to the extent they are sufficient, apply and distribute the proceeds of the
liquidation in the following order:
i. Payment or satisfaction of all indebtedness secured by Company assets and all
other Company debts, including, but not limited to, loans from Members (if any) and expenses of
liquidation;
ii. Deposit of reasonable reserves for the payment of contingent liabilities and
expenses of the Company in a trust account and, after the passage of a reasonable period of time and
the payment of any contingencies arising in that period, the balance remaining in the trust account
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Federal Way Parcel A, LLC. OA.05-03-21
shall be distributed to the Members in accordance with the ensuing provisions of this Paragraph 13;
and
iii. After allocation of Profits and Losses arising from the liquidation of Company
assets, the remaining liquidation proceeds shall be distributed to the Members to the extent of and in
proportion to their positive Capital Account balances.
C. Company Assets Sole Source of Return of Capital. Each Member shall look solely to
the assets of the Company for all distributions with respect to its interest in the Company and shall
have no recourse therefore, on dissolution or otherwise, against the Manager or other Members.
d. Deficit Capital Account Balance. If, following the dissolution and liquidation of the
Company, a Member has a negative balance in its Capital Account, such Member shall be obligated
to contribute an amount equal to such negative balance to the capital of the Company.
e. Re uirement of Liquidation According to Capital Account Balances. Following the
dissolution of the Company, liquidating distributions shall be made to those Members who have a
positive balance in their Capital Accounts in accordance with their positive capital account balances
pursuant to Treasury Regulation Section 1.704-1(b)(2)(ii)(b)(2). All such liquidating distributions
shall be made by the close of the taxable year in which the liquidation occurs or within ninety (90)
days following the date of such liquidation, whichever is later. Liquidating distributions may be
made to a trust established for the benefit of the Members for the purposes of liquidating Company
assets, collecting amounts owed to the Company, and paying any contingent or unforeseen liabilities
or obligations of the Company. The assets of any such trust shall be distributed to the Members at
such time or times as the Manager may determine in the same proportions as the amount distributed
to such trust by the Company would otherwise have been distributed to the Members pursuant to this
Agreement.
14. AMENDMENTS.
a. Amendments to Admit Additional or Substituted Members. If this Agreement is
amended to reflect the admission of an Additional Member, such amendment shall be signed by all
of the Members and by such Additional Member. If this Agreement is amended to reflect the
substitution of a Member pursuant to this Agreement, the amendment to this Agreement shall be
signed by all of the remaining Members, by the Person to be substituted or added, and by the
transferor Member.
b. All Other Amendments. With the exception of amendments permitted under
Paragraph 14. a, any amendment to this Agreement must be approved by a Required Majority of the
Members. Any amendment to this Agreement may be proposed by any Member. Following such
proposal, the Member shall submit a verbatim statement of any proposed amendment and an
assessment as to the effect of such amendment on the liability of the Members for the debts of the
Company.
C. Covenant to Sign Amendments. Each Member shall promptly execute, acknowledge
and deliver to the Company such documents and instruments as may be necessary to effectuate any
amendments to this Agreement authorized pursuant to this Paragraph 14.
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Federal Way Parcel A, LLC. OA.05-03-21
d. Filing of Amendment. In making any amendments to this Agreement, there shall be
prepared and filed for recordation by the Manager and/or Members such documents and certificates
as shall be required to be prepared and filed under the laws of the applicable jurisdiction.
15. GENERAL PROVISIONS.
a. Notices. Any notice, demand, consent, approval or document which is required or
permitted under this Agreement shall be given in writing by (i) personal delivery; (ii) certified mail,
return receipt requested, postage prepaid; (iii) a national overnight courier service that provides
written evidence of delivery; or (iv) facsimile transmission and addressed as follows: (1) if intended
for the Company or the Manager, addressed to the Company or the Manager at the Company's
principal place of business, or, (2) if intended for a Member, to the Member at its address set forth
on Exhibit `B" (as amended from time to time). Any Person may change its notice address and/or
facsimile number by giving written notice thereof in accordance with this Paragraph 15.a. All
notices hereunder shall be deemed given: (A) if delivered personally, when delivered; (B) if sent by
certified mail, return receipt requested, postage prepaid, on the third day after deposit in the
U.S. mail; (C) if sent by overnight courier, on the first business day after delivery to the courier; and
(D) if sent by facsimile, on the date of transmission if sent on a business day before 5:00 p.m.
California time, or on the next business day, if sent on a day other than a business day or if sent after
5:00 p.m. California time, provided that a hard copy of any notice sent by facsimile must also be sent
by either a nationally recognized overnight courier or by U.S. mail, first class, postage prepaid.
b. Attorneys' Fees. Should it become necessary for any party to this Agreement, or
someone acting on any party's behalf, to incur costs and expenses to retain the services of an
attorney to enforce this Agreement, or any portion thereof, the prevailing party in any litigation or
arbitration shall be entitled to recover its reasonable costs and attorneys' fees thereby expended, for
which liability is incurred.
C. Number, Gender and Tense. As used in this Agreement, the singular and plural
numbers, the masculine, feminine and neuter genders and the past, present and future tenses shall
each be deemed to include the others, wherever the context so indicates.
d. Governing Law. This Agreement and the rights, duties and obligations of the
Members shall be governed by and construed and enforced according to the laws of the State of
Delaware (without regard to conflict of laws principles).
e. Final and Entire Agreement, Integration. This Agreement is the final, entire and
exclusive agreement between the parties and supersedes all prior and contemporaneous agreements,
understandings, commitments, discussions, summaries, brochures, and projections, whether oral or
written. No representation, promise, inducement or statement of intention has been made by any of
the parties not embodied in this Agreement or in the documents referred to herein, and no party shall
be bound by or liable for any alleged representation, promise, inducement or statements of intention
not set forth or referred to in this Agreement. No amendments or modifications to this Agreement
may be made without a writing signed by the party to be bound.
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Federal Way Parcel A, LLC. OA.05-03-21
f. Unenforceability. If any clause, provision or term of this Agreement shall be
determined to be invalid or unenforceable, the remaining clauses, provisions and terms shall remain
in full force and effect.
g. Counterpart Copies. This Agreement may be signed in one or more counterparts and
the signed counterparts, taken together, shall constitute an original of this Agreement for all
purposes. For the purpose of assembling a fully executed copy of this Agreement, the Manager
and/or Members may detach the signature pages from each counterpart and attach the same to a
counterpart copy of this Agreement, which assembled counterpart shall then constitute the original
of this Agreement.
h. Binding on Successors. This Agreement shall be binding on the Members and the
Manager and shall inure to the benefit of their respective heirs, devisees, legatees, personal
representatives, successors and assigns, subject to the restrictions on transfer of Member Interests set
forth herein.
i. Construction. Each party to this Agreement has carefully reviewed this Agreement, is
familiar with the terms and conditions hereof, and was advised by legal counsel of its own choice
with respect thereto (or chose not to seek the advice of legal counsel). This Agreement is the
product of negotiation among the parties hereto and is not to be interpreted or construed against any
party hereto.
j. Waiver. The failure of any party to insist on strict compliance with any of the terms,
covenants, or conditions of this Agreement by any other party shall not be deemed a waiver of that
term, covenant, or condition, nor shall any waiver or relinquishment of any right or power at any one
time or times be deemed a waiver or relinquishment of that right or power for all or any other times.
[Remainder of page intentionally left blank]
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Federal Way Parcel A, LLC. OA.05-03-21
IN WITNESS WHEREOF, this Operating Agreement has been executed as of the Effective
Date set forth above.
Manager:
Holdings Federal Way Manager, LLC,
a Delaware limited liability company
By: aw-ulw
John A. a , Chief Executive Officer
Member:
Holdings Federal Way, LLC,
a Delaware limited liability company
By:
John A. 11aj
Chief Executive Officer
S-1
Federal Way Parcel A, LLC. OA.05-03-21
Exhibit "A"
GLOSSARY OF TERMS
"Act" means the Delaware Limited Liability Company Act, Sections 18-101 to 18-1109 of
the Delaware Code, as amended from time to time.
"Additional Member" means any Member admitted to the Company as a Member, other than
the Member, as permitted by this Agreement.
"Affiliate" means, when used with reference to a specific Person: (a) any Person directly or
indirectly, through one or more intermediaries, controlling, controlled by, or under common control
with such Person; (b) any Person owning or controlling ten percent (10%) or more of the outstanding
voting interests of such Person; and (c) any relative or spouse of such Person.
"Agreement" means this Operating Agreement of the Company, as originally executed and as
amended from time to time, as the context requires.
"Bankruptcy_" means, with respect to any Person, if such Person (i) makes an assignment for
the benefit of creditors, (ii) files a voluntary petition in bankruptcy, (iii) is adjudged a bankrupt or
insolvent, or has entered against it an order for relief, in any bankruptcy or insolvency proceedings,
(iv) files a petition or answer seeking for itself any reorganization, arrangement, composition,
readjustment, liquidation or similar relief under any statute, law or regulation, (v) files an answer or
other pleading admitting or failing to contest the material allegations of a petition filed against it in
any proceeding of this nature, (vi) seeks, consents to or acquiesces in the appointment of a trustee,
receiver or liquidator of the Person or of all or any substantial part of its properties, or (vii) if 120
days after the commencement of any proceeding against the Person seeking reorganization,
arrangement, composition, readjustment, liquidation or similar relief under any statute, law or
regulation, if the proceeding has not been dismissed, or if within 90 days after the appointment
without such Person's consent or acquiescence of a trustee, receiver or liquidator of such Person or
of all or any substantial part of its properties, the appointment is not vacated or stayed, or within 90
days after the expiration of any such stay, the appointment is not vacated. The foregoing definition
of "Bankruptcy" is intended to replace and shall supersede and replace the definition of
"Bankruptcy" set forth in Sections 18-101(1) and 18-304 of the Act.
"Capital Account" means the Capital Account of a Member maintained by the Company in
accordance with the provisions of Paragraph 7 of this Agreement.
"Capital Contribution" means the sum of the amount of cash and fair market value of other
property (reduced by indebtedness encumbering such property) contributed by a Member from time
to time to the Company.
"Cash Flow" means, for each fiscal year, the cash proceeds received by the Company from
the operation of the Company's business or investments for such year or from a sale or refinancing
of any real or personal property of the Company, as reduced by: (a) expenses incurred in the
operation of the Company's business or investments paid or payable by the Company during such
year; (b) amounts paid or payable to creditors of the Company out of such proceeds; (c) costs and
expenses incurred by the Company for capital improvements, replacements or repairs paid or
payable out of such proceeds; and (d) reasonable reserves for (i) the replacement or preservation,
during the current or any future fiscal year, of any property of the Company, (ii) the working capital
needs of the Company, (iii) the purchase of new assets for the Company, or (iv) the repayment or
prepayment of existing loans.
"IRC" means the Internal Revenue Code of 1986, as amended from time to time.
"Losses" means loss from the operation of the business of the Company or from the sale of
Company property for each fiscal year, as determined for federal income tax purposes.
"Member Interest" means an interest in the Company owned by any Member, giving such
Member the rights and duties specified in this Agreement.
"Member Percentage" means the percentage interest of a Member in the Company as set
forth on Exhibit "B", as amended from time to time.
"Members" means the Member, any Additional Member and/or any Person who is admitted
as an Additional Member of the Company or a substitute Member of the Company pursuant to the
provisions of this Agreement, each in its capacity as a Member of the Company.
"Person" means any individual, partnership, limited liability company, corporation, joint
venture, association, trust, or other entity.
"Profits" means the net profit from the operation of the business of the Company or from the
sale of any property of the Company for each fiscal year, as determined for federal income tax
purposes.
"Required Mgjority of the Members" means Members holding Member Percentages that, in
the aggregate, comprise more than fifty percent (50%) of the Member Interests, unless a higher
percentage is otherwise required by law or by this Agreement. Whenever a particular Member is
excluded from voting on a particular matter, its Member Percentage shall be excluded from the
calculation of votes or consents required for the action to be taken.
"Treasury Regulations" means the regulations promulgated by the Internal Revenue Service
pursuant to the IRC, as such regulations may be amended from time to time.
Exhibit "B"
NAMES, ADDRESSES, AND MEMBER PERCENTAGES
Name and Address
Holdings Federal Way, LLC
4020 Kinross Lakes Parkway, Suite 200
Richfield, Ohio 44286
Tel: (330) 659-4060
Membcr Percentage
100%