HomeMy WebLinkAboutSW4240602_Recorded Document_20241121 C201504200356
SOSID: 1428034
Date Filed:2/13/201511:32:00 AM
Elaine E Marshall
State of North Carolina North Carolina Secretary of State
Department of the Secretary of State C2015 042 00356
Limited Liability Company
ARTICLES OF ORGANIZATION
Pursuant to§57D-2-20 of the General Statutes of North Carolina,the undersigned does hereby submit these
Articles of Organization for the purpose of forming a limited liability company.
1. The name of the limited liability company is: Baltimore RE, LLC
(See Item Iof the Instructions for appropriate entity designation)
2. The name and address of each person executing these articles of organization is as follows: (State
whether each person is executing these articles of organization in the capacity of a member,organizer
or both. Note: This document must be signed by all persons listed.)
Neil Cornatzer - Managing Member, Organizer
1147 Riverbend Drive
Advance, NC 27006
3. The name of the initial registered agent is: Nell Cornatzer
4. The street address and county of the initial registered agent office of the limited liability company is:
Number and street 1 147 Riverbend Dr.
City Advance State:NC Zip Code: 27006 county: Davie
5. The mailing address,if different from the street address, of the initial registered agent office is:
Number and Street
City State:NC Zip Code: County:
6. Principal office information: (Select either a or b.)
a. M The limited liability company has a principal office.
The principal office telephone number:
The street address and county of the principal office of the limited liability company is:
Number and Street
City State: Zip Code: County:
CORPORATIONS DIVISION P.O.Box 24622 RALEIGK NC 27626-0622
(Revised January 2014) 1 (Form L-41)
C201504200356
The mailing address,if different from the street address, of the principal office of the company is:
Number and Street
City State: Zip Code: County:
b. Q The limited liability company does not have a principal office.
7. Any other provisions which the limited liability company elects to include(e.g.,the purpose of the entity)
are attached.
8. (Optional):Please provide a business e-mail addr Privacy Redaction
The Secretary of State's Office will e-mail the business automatically at the address provided above at no
cost when a document is filed. The e-mail provided will not be viewable on the website. For more
information on why this service is offered,please see the instructions for this document.
9. These articles will be effective upon filing,unless a future date is specified:
This is the 5 day of February 2015
Signature
Neil Comatzer-Manager
Type or Print Name and Title
The below space to be used if more than one organizer or member is listed in Item#2 above.
Signature Signature
Neil Cornatzer
Type and Print Name Title Type and Print Name and Title
-s-15'
igna Signature
Type and Print Name and Title Type and Print Name and Title
NOTES:
1. Filing fee is$125. This document must be filed with the Secretary of State.
CORPORATIONS DIVISION P.O.Box 29622 RALEIGH,NC 27626-0622
(Revised January 2014) 2 (Form L-01)
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BA TIMORE RE , LLC
OPERATING AGREEMENT
THIS OPERATING AGREEMENT (the "Agreement") is mad e and entered into effective
as of May 12 , 2015 , by and between Kevin Jessup ("Jessup") , a resident of the state of North
Carolina, R ichard Mossman ( Mossman a resident of the state of North Carolina, Neil Cornatzer
("Cornatzer") , a resident of the state of, North Carolina, and Oak Ridge Development, LLC , a NC
limited liability company ("Oak Ridge") .
NOW, THEREFORE , for and in consideration of the mutual covenants and conside ration
hereinafter contained, the parties hereto enter i nto this Operating Agreement for Baltimore RE
, LLC
(the " Company" ) , and agree as follows :
ARTICLE I
FORMATION
Section 1 . 1 -- Formation of the, Company. The Company was firmed on February 13 ,
2015 upon the filing of Arti' c les of Organizat ion (as amended from time to t ime, the " Articles ") with
the North Carolina Secretary of State pursuant to the North Caro l ina Limited Li" abolity Company Act
(as amended from time to time , the "Act") by Cornitzerasor2an izer (the " Organizer") . The rights
and obl igations of the parties and the organ izat ion, opera tion, lissolution, and winding up of the
Company, shall e governed y the Act, the Articles and this Agreement,.
Section L2 -- Names . The name of the Company may change from time to time by
amendment of the Articles in accordance with the Act . The Company may transact business under
one or more assumed names as determined from time to time by the Managers, subject to compliance
with any applicable laws relating to use o assumed names .
Section 1 . 3 -- Registered Agent and Office . The Company' s registered agent shall be
Jessup and the Company' s registered office shall be 802 Northern Shores Lane , Greensboro , North
Carolina 27455 .
ARTICLE II
DEFINITIONS
Section 2 . 1e ini ions . Whenever used inthis Agreement, the following termss ave
the meaning assigned to them in this Section 2 . 1 except to the extent expressly otherwise provided in
thi s Agreement :
Addendum . "Addendum" shall mean the Allocation Addendum attached hereto and hereby
incorporated into this Agreement for all purposes , containing provisions reelat ing to al locat ions
among the Members ,.
2
Capital Account. " Capital Account" shall have the meaning provided in the Addendum.
Cap ital Contributions . " Capital C ontributions" shall mean, with res pect to any Member!,
the amount of money and the initial Gross Asset Value of any property (other than money)
contributed to the Company with respect to the Membership Interest held by such Member pursuant
to the terms of thi s Agreement .
Code. " Code" shall mean the Internal Revenue Code of 1986 as amended (or correspond ing
provisions of subsequent laws) .
Company. "Company" shall have the meaning provided in the recitals of this Agreement .
Company Property. " Company Property" shall mean all assets , interests , properties and
rights of any type owned by the Company .
Fiscal Year. "Fiscal Year" shall mean the Company' s taxable year for Fed eral income tax
P u r p o ses o r, if the context requires , any portion of such year for wh " ch the Company is required to
allocate Profit, Loss , and other items of Company income , gain, loss or deduction pursuant to Article
VII .
Gross Asset Value,* "Gross Asset Value" shall have the meaning provided in the Allocation
Addendum .
Manager,. "Manager" shall have the meaning provided in the Act.
Member. "Member" shall have the meaning provided in the Act and shall for p urposes of
this Agreement include Jessup , Mossman, Comatzer and Oak Ridge until such Person ceases to be a
Member in accordance with the Act .
"Membership Interest" means all of a Member' s rights and
Membership Interest.
obligations with respect to the Company, including without limitation, the Member' s share of the
Profit and Loss of the C ompany, the right to receive distributions of the Company' s assets , a nd the
right to participate in the management o the Company as a Member and/or Manager as provided in
this Agreement or the Act .
Percentage Interest., "Percentage Interest" shall mean the Percentage Interests reflected on
the Schedule of Ownership required by Section
Person . "Person" shall mean and include any individual , trust, partnership , association,
l imited I1ab il ity company, corporation or other entity.
Profit or Loss . "Profit" and "Loss" shall have the meani ded in the Addendum.
ng provi
3
Regulations . "Regulations" shall mean the Income TaxRegulati* ons (including Temporary
Regulations) promulgated under the Code , as such reg ulations maybe amended from time to time
(including corresponding provisions of succeeding regulations) ,*
Transfer. "Transfer" and any capitalized variation thereof shall mean or refer to any
assignment, sale , grant., conveyance , or other transfer or vesting, whether gr atu1* tously or for
conside rat i on, consensually or by operati* on 'of law, including but not lim ited to any tr ansfer or
vesting pursuant to testate or intestate successiong equitable distribution or other divorce proceed ings
or creditor proceedings .
Section 2 .2 . Additional definitions may appear elsewhere in this Agreement .
ARTICL E III
CHARACTER OF THE BUSINESS
Section 3 . 1 -- Purpose . The Company ' s principal purpose shall be to own and manage real
estate and other investments . The Company also may engage in any and all other lawful busi' nesses
or activities .
Section 3 . 2 -- Powers . The Co mpany shall have all powers permissible under the Act .
ARTICLE IV
PRINCIPAL OFFIC AND TERM
Section 4 . 1 -- Principal Office. The location of the principal office of the Company shall be
802 Northern Shores Lane , Greensboro , North Carolina 27455 or such other location as the
Managers may determine ,, The Company also may conduct business at any addot'* onal locations as
may from time to time be determined by the Managers ..
Section 4 .2 -- Term . The term of the Company shall be as set forth i* n the Articles , unless
earlier dissolved as provided in this Agreement .
ARTICLE V
TAX STATUS AND ACCOUNTING
Section 51 -- Income Tax Status . The Members intend that the Company shall be classified
as a partnership subject to Subchapter K of Chapter 1 of the Code for Federal and state income tax
purposes . Such classification as a partnership shall be solely for Federal and state income tax
purposes , and shall not affect the limited llability of the Managers and Members or otherwise affect
the status of the Company, its Managers and Members under the Act .
Section 5 .2 -- Accounting. The books of the Comp any shall be kept, to the extent possible ,
in accordance with the accounting principles employed by the Company for Federal income tax
4
purposes . The Managers shall cause to be fj le d the United States Partnership Return of In come and
all other tax returns required to be fled for the Company for all applicable tax years . Within 90 days
after the end of each Fiscal Year, the Managers shall send to each Person who was a Member at any
time during the Fiscal Year then ended such. tax information as shall be necessary for the preparation
its Federal incomeincome, ot state andby such Person oher tax returns .f
Section 503 -- Capital Accounts . A separate Capital Account shall be maintained for each
Member in accordance with the defilni tion thereof.
Section 5 . 4 -- Tax Matters Partner. The "tax matters partner" for the Company within the
meaning of Code Section 6231 (a) (7) ("Tax Matters Partner"} , Shall be the Member so designated
from time to time by the Xanagers with the consent of such Person or , in the absence of such a
designation, the Member otherwise determined under the Code . The exercise and performance of the
Tax Matters Partner' s rights and obl igations in such capacity shall be at the Company' s expense . The
Parties hereby unanimously designate Jessup as the Tax Matters Partner, and Jessup hereby accepts
such designation .
ARTICLE VI
CAPITAL CONTRIBUTIONS
Section 6. 1 -- Initial apital Contribution. The i* nitial Members shall contribute cash to
the Company as their initial Capital Contr ibutions as follows :
Jessup $ 50000 -* 00
0matzer $ 501000000
ossman $ 50000 -e00
Oak Ridge $ 50000 -w00
Section 6 .2 -- Additional Capital contributions . If the Managers determine that the Initial
Capital ontributions are insufficient to service outstanding indebtednessoftheComany or to pay
the costs and expenses of maintai ning the Company Property, or to carry out the purposes o e
Company, the NAanagers may request that the Members make additional contributions to the capital
of the Company. If Members owning seventy percent (70%) o the Percentage Interests approve
such request, then each o e Members shall be obligated to make such additional contributions
(each an "A dditional Capital Contribution") to the Company ratably in accordance with such
Members ' thenexis ti ng Membership Interests within the time period approved byt e Managers .
5
In the event a Member f4iils to ful fill its commitment to make such Additional Capital
Contributions (the "Defaulting Member s) ") , the other Members (the "Non-Defaulting M embers")
may elect to contribute to the Company such Addl'btl* onal Capital Contr ibut ions . All amount s so
contributed by the Non�Defaulti ng Members shall be considered a loan to the Defaulting Member(s) ,
for which they shall be jointly and severally Iiable , bear ing interest at the annual rate of fifteen
Percent ( 15 %) , until repaid . In ad dit ion, unt il all o f such loans are repaid by the Default ing
Member(s) , all distributions from the Company which would have been paid to the Defaulting
Members) shall be pai d to the NonowDef aulting Mem bers in payment of then outstanding interest and
P rincipal of such loans . The Defaulting Members) hereby gr ants the Non-Defaulting Members a
security interest in the Defaulting Member ' s Membership Interests to secure repayment of such loans
by the Non�DeEaul ting Members to the Defaulting Members) and the Non�Defaulting Members
shall have a ll o f the rights and remedies - of a secured party under the North Carolina Uniform
Commercial Code .
ARTICLE VII
ALLOCATIOleTS AND DISTR IBUTIONS
Section 7 . 1 -- Profit and Loss . At the end o each Fiscal Year, the Profit or Loss of the
. Company for the F iscal Year then ending shall be determined . After making any allocations
pursuant to the Addendum, and subject to the provisions o "11,111, the Addendum, the Profit or Loss for
eac h Fiscal Year shall be allocated among the Members in proportion to their respective Percentage
ere sts at the end of such Fiscal Year ; provided, however, that in the event that a Member ' s
ercentagc Interest changes during a Fiscal Year, the allocation of Profit or Loss for the Fisca ear
l Y
shall take account 0suc change in accordance with the Addendum .
Section 7 .2 -- Interim Di* s .ributions . The Managers shall have the sole discretion to make
istributions to the Members from time to time prior to dissolution of the Company . Any such
distributions shall be made among the Members in proportion to their Percentage Interests .
ARTICLE VIII
RIGHTS AND OBLIGATIONS OF MANAGERS
Section 8* 1 -- Management.
(a) In accordance with Act Secti on 57C - 3 -20 and the Articles , all Members of the
Company shall e Managers by virtue of their status as Members . Only Members maybe Managers .
A Person shall become a Manager upon being admitted as a Member and thereafter shall continue as
a Manager so long as an only so long as) such Person continues to be a Member .
(b) In addition to and not in limitation o any rights anowers conferred by law or other
provisions of this Agreement and except only as limited, restricted or prohibited by th e expre s s
provisions of this Agreement, the Managers shall have full , exclusive and complete d iscretion in the
management and control o f the affai rs of the Company and shall make . all decisions affecting
Company affairs .
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(C) Each Manager shall have equal rights and authority to participate in the management
decisi ons , elections , determinations , or other actions to be taken or made bythe
of the Company. All
Managers in sueh capacity shall require the approval , consent, agreement or ratification of Mana. ers
owning more than seventy percent ( 70%) of the Percentage Interests ; provided, however that the
Company shall make no new investments without the approval , consent,, agreement or ratificat ion of
all Managers ,,
Section 8 .2 -- Limited Liability & Indemnification.
(a) To the full extent provided in the Act, the Managers shall not b e liable for the
obligations of th e Company .
(b) To the full extent permitted by Act Section 57C. 3 . 32 , the p ersonal liability of a
Manager for monetary damages or a b reach of any duty provided for in Act Section 57C - 3 -22 isf
hereby elim40 inated .
(C) The Company shall i ndemnify each Manager for judgments, settlements ,
penalties , fines , and expenses to the full exeni* ttedttperm by Act Section 57Cww3 - 32 -
(d) The authority of a Manager or the Managers to act on behalf of the Company
may be delegated by such Manager or the Managers to Persons other than Managers , to the full
extent permitted by Act Section 57C - 3 - 24 .
ARTICL E IX
RIGHTS AND OBLIGATIONS OF MEMBERS
Section 9 . 1 -- Admission .
(a) No Person shall acquire any Membership Interest directly from the Company
except with the consent of all of the Managers .
(b) n assignee o all or a portion of a Membership Interest shall be admitted as a
Member only as provided in Article XI .
C) The Members hereby agree that Membership Interests o not constitute
securities for purposes o the Securi ties Act of 1933 or the North Carolina Securities Act .
Section 9 .2 -- Withdrawal. A Member shall not be entitled to mydistribution upon an event
of withdrawal isted in Act Section 57C - 3 - 02 , except such di stribution, if any, as may - be determined
by the Managers .
ection 9 .3 -- Limited Liability & Indemni" fication. To the full extent provided in the Act,
Members shall not e liable for the oblig ations o e Company . The Company shall indemnify each
7
Member for judgments , settlements, penalties , fines and expenses to the full extent permitted by the
Act .
ARTICLE X
DISSOLUTION AND LIQUIDATION
Section 10 . 1 -- Dissolution . The Company shall be dissolved upon the earliest to occur of the
fol lowing : (i) expiration of the term as set forth i* n the Articles ; ii) a decision to dissolve by the
Manage rs ; or (in) entry of a decree of judicial dissolution under Section 57C - 6 - 02 of the Act, or the
Iling by the Secretary of State of a certificate of d issolution under Section 57C -6 -wO3 of the Act .
Provided that in the event the Company is administratively dissolved pursuant to Act Section 5 7C-6-
03 , the Managers may apply to reinstate the Company, and appeal any denial of such application, as
provided in Act Section 57C -6 - 03 (c) . The Company shall not dissolve upon an event of wi ..hdrawal
as to any member listed in Act Section 57C -3 - 02 ,,
Section 10 .2 mom Accounting. In the case of dissolution of the Company , a proper accounting
shall be made of the Capital Account o f each Member, and the Profit or Loss and other items of the
Company from the close of the preceding Fiscal Year shall be determined and allocated among the
Members in accordance with Article VI1 . Financial statements presenting such an accounting shall
be delivered to all Members , ati
Company expense , within 90 d ays after the assets of the Company
have been distrbuted to the Members or otherwise applied in accordance with Section 10 . 3 .
Section 10 *3 -- Liquidation of Company or of Membership Interests .
(a) Winding Up & Liquidating Distributions . U pon dissolution of the Company,
the Managers shall liquidate the assets o the Company . The Members shall continue to share Profit,
Loss , and other items during the period of l iquidat ion in the manner prov ided in Article V11 ,, The
Managers sha ll have full right and unlimited discretion to determine the time , manner and terms of
any sales of Company Property pursuant to such liquidation, having due regard tot e activity and
conditions o e relevant market and general financial and economic conditions . Followi ng the
payment of allebts and liabil ities of the Company (including any indebtedness of the Company to
the Members) and the expenses. of liquidation, and subj ect to the right of the Managers to set up such
reserves as the Managers may deem reasonably necessary for any contingent or unforeseen liabilities
of the Company, the Managers shall distribute any remalning ompany Property to all Members with
positive Capital A ccount balances in the rat io of their respective p osit ive Capital ccount alanc e to
the sum of all such positive Capital Account balances, determined after all Capital Account
adjustments other than di* stributions pursuant to this sentence . Any d'pstri butions pursuant to thi s
ection 1 . a) shall be made by the end of the Company' s axable year in Wh ich the liqu idation
occurs or, if later, within 90 days after the date of the liquidation) .
(b) Interim Liquidation of Membership Intere sts . Upon the liquidation of any
than pursuant to liquidation of the Company, liquidating distriMembership Interest otherbutions
shall be made in accordance with the positive Capital Account balances of the Members as
eterm- ined after taking i nto account all Capital Account adjustments for the Company' s taxable year
8
during which the liquidation occurs other than adjustments resulting from distributions pursuant to
this Section 10 . 3 (b)) by the end of such taxable year ,(or if later, within 90 days after the date of such
liquidation) .
c) No Deficit Restoration. Each Member shall look solely to the assets of the
company for the return of the Member' s Capital Contributions , the Member' s share of any Profit,
and any other distributi ons or payments, and shall have no recourse therefor upo n dissolution or
otherwise) against the Mana gers or any o f the Members . Without lim it ing any of the ir respect ive
obli' gations set forth in th is Agreement, no Member shall have any obligation to contribute any
deficit balance in its Capital Account exis t in g at any time . No Member shall have any right to
cash upon dissolution and liquidation of the Company.
receive property other than
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(d) DefjinitDefinition. For purposes of this Section 10 . 3 , "liquidation" of the Company or
of a Membership Intere st shall have the meaning prov ided in Regu lations Section 1 . 70:4�
provided that the Company shall not be required to wind up and make actual
d ' stribut ions if the liquidat ion cons ists only of a deemed termination under Code Section
7-08 (b)( 1 ) (B) a
AR TICL E XI
TRANSFERS OF INTERESTS
Section 11 . 1 -- Restriction on Transfer. No Person may Transfer any or all of its
embership Interest, other than (a) a Transfer pursuant to Section 11 . 2 or (b) wi th the consent of all
other Members . A Transfer permitted by this Section 11 . 1 Shall not be effective unless and until the'D
Transferor and Transferee execute and deliver to the Company an Instrument of Accession n the
form of EXhibit A . Any such Transferee shall take the Membership Interest subject to this
Agreement, and shall not be admitted as a Member .exce t pursuant to Section 11 . 8111.
S ection 11 .2 -- Right of ]First Refusal.
(a) A Member (the " Selling Member") desiring to Transferal or a portion, of the
elling Member' s Membership Interest (the "Offered Interest") pursuant to an arm ' s length bona fide
WriIIIten o ffer ("Third arY Off er") received from a third party (the " Third Party Buyer") o ffering to
Urchase such Membership Interest in exchange only for cash paid at closing, shall first submit a
Third Party Offer to the Company and the other Members . The Third Party Offer sha
copy ofthell
specify the price for the Offered Interest (the " Offer Price ") . The Third Party Offer shall contain no
other terms .
(b) The Company shall have 3 0 days from the date it receives the Third Party O ffe r
(the "Refusal Option Peri* od") , in which the Company at its option may elec t t o Purchase all , but not
less than all , of the Offered Interest on the terms provided i* n the Third Party Offer, subj* ect to Secti on
11 . 6 hereof. In order to elect to purchase the Offered Interest, the Company must send notice of its
electi on to purchase to the Selling Member and the other Members no later than the last day o e
Refusal Option Perio
d.
9
C) If the Company does not timely elect to purchase the Offered Interest, each
Membero ther than the Selling Membershallhave30 days from theexpir atlono f the Refusal Option
Period toelectto pUrchase all , but not Iess thanall , of the Offered Interest on the terms provided in
the Third Party Offer, by sendi* ng notice of the Member' s election to purch ase to the Selling Member
and the other Members no later than the last day of such 30 day p erio d . In the event that two or more
Members tiomely elect to purchase the O ffered Interest, the O ffered Interest shall be sold by the
Sell ing Member to the purchasing Members in proportion to. the Percentage Interests owned by the
purchasing Members as of the last day of the Refusal Option Period .
(d) If (and only if) the Company or the Members do not timely elect to purchase
the Offered Interest, the Selling Member may Transfer all , but not less than all , of the Offered
Interest to the Third Par ty Buyer on exactly the terms provided in the Th ird Party Offer ,, If for any
reason the qelling Member does not consummate the Transfer to the Third Party Buyer by the 9 0th
day following the end of the Refusal Option Period, the Selling Member must again comply with this
Section 11 . 2 before it may Transfer the Offered Interest to a Third Party Buyer.
Section 11 .3 --Intentionally O mitted.
Section 11 .4 -- Limitation on Liability . In the eventtheCom any purchasesaMembership
Intere st pursuant to Sections 11 . 2 , no Manager or Member shall have any personal l iability for the
payment of the purchase price , whether for any portion payable in cash at the Closing or any portion
payable through the Company' s promissory note .
ection 11 . 5 mom Determination of ompany Elections . The Company shall exercise its
option under Section 11 . 2 , and shall make all elections to be made by the Company under
Members then own a ing majority of the Percentage Interests owned by a
Section 11 . 2 , only asll
embers other than the Selling Member may direct in writing .
Section 11 . 6 -- Closing. The closing o any Transfer of a Membership Interest to the
Company or one or more other Members , pursuant to Sections 11 . 2 , shall occur at 10 : 00 a. m .
local time on or before the 60th day following the last day of the Refustion Period .
cction 11 . 7 -- Termination o estrictions . If not sooner terminated, anyrovisions of
this Article XI that are subject to the Rul e Against Perpetuities shall terminate prospec. tively on
the 20t anniversary o e death of the latter to die o f:
Jessup , ossman or Comatzer
SSectionmission o Transferee. A Transferee under a Transfer that is effective
under Secti on 11 . 1 , (i) shall be entitled to receive ,, to the extent so Transferred, only the allocations
and distributions to which the Transferring Member would be entitled but for theransfer, and (ii)
shall be subject to all the restrictions and liabilities of aember with respect to the Membership
Interest Transferred, including wi
thout limitation this Article XI with respect to any subsequent
10
Transfer of all or any portion of the Membership Interest Transferred . Unless such Transferee at the
time of the Transfer i s already adm itted as a Member, . such Transferee shall not be entitled to
admission as a Member or to exercise any rights or powers of a Me' mber with respect to the
Membership Interest Transferred, except with the consent of Mem bers owning more than seventy
percent (70 %) of the Percentage Interests of all the non- Transferring Members .
Section 11 . 9 - injunctivRelief. Ae Transfer of all or any part of a Membership Interest inthe
bre ach of this Agreement shall be of no force and effect and the Company shall not recognize
Transfer for purposes of allocating Profit or Loss , making distributions, or any other purpose . The
Members agree that a Transfer in breach of this Agreement shall result in irreparable harm to the
COmpany and the other Members , for which there is no adequate remedy at law, and that accordingly
the Company and other Members shall be entitled to in junct ive and other equitable relief for such
breach in addition to damages or other relief available at law.
ARTICLE XII
MISCELLANEOUS
Section 12 . 1 -- Notices & Consents .
(a) All notices , consents , or other communications required or permitted to be
given pursuant to this Agreement to be e ffective must be in a w rit ing s igned by the giving party .
(b) All such communications shall be deemed given, delivered, and received on (1)
the date of delivery shown on the return receip t, i f sent by ceIified or registeredmai* 1 , relurn receipt
reque sted, first class, postage prepaid, addressed to the recipient at its last known address shown in
the Company' s records, or ii) the date of actual de l ivery to such address, if sent y other means .
C Except as may be otherwise provided in this Agreement, any consent of a
Person required by this Agreement may be given or withheld by such Person in such erson1s sole
and absolute scretion and subject to any conditions such Person may iose .di
Section 12 .2 -- Amendments . Amendments to this Agreement maybe made only by written
agreement o all the Members .
Section 12 .3 -- Governing Law. This Agreement shall be governed b and construed in
accordance with the Act and the other applicable laws o e State of North Carolina. If any
provision of this Agreement violates any sucI *
appcable laws, or if any provision of this Agreement
would result i 0 n classification o e Company as an association taxable as a corporati on for Federal
income tax purposes , th en such provision shall be deemed severed and deleted from this Agreeme nt
and th49
i s Agreement shall be applied as though it did not contain such provision .
Section 12 . 4 -- Successors and Assigns ; No Third-Party Beneric iary. This Agreement and
all the terms , and provisions hereof shall be binding upon and shall inure to the benefit of the
Managers and Members and , subject to the restrictions on Tran '0
sfer, theirres ective successors and
11
assigns . No other Person shall be deemed a third-party beneficiary of, or otherwise have any rights
under or with respect to , this Agreement.
Section 12 . 5 -- Scheduleo f Ownership . The Schedule of Ownership attached hereto shall
reflect the Percenta ge Interests of all Persons ,, Intheeventofa TransferofaMembership Interest (or
Po rtion thereo f permitted b y this A greement, the admission of an ad ditional Member in accordance
with this Agreement, or an event of withdrawal of a Member, the Managers shall prepare a revised
dD
Schedule of Ownership to this Agreement reflecting such matter.
Section 120
6 -- Captions , Articles, Sections, Paragraphs , Numbers, Gender, Exhibits , and
Schedules . Captions contained in this Agreementare intended onIYas a matter of convenience and
in no way define , I imit or extend the scope or intent of this Agreement or any provision hereof. All
references in this Agreement to Articles , Sections , or Paragraphs shall be deemed to refer to Articles ,
Sections , or Paragraphs of this Agreeme nt except to the extent otherwise requ ired by the context .
the context,, (i) whenever the singular number is used in this Agreement
When required byi t shall
include the plural , and vice versa, and (ii) refirence to a gender shall include t he other genders . Any
Exhibits or Schedules refeffed to i n Agreement are incorporated into this Agreement by such
reference .
Section 12 . 7 -- Waivers . No waiver of any Provision of this Agreement shall be effective
unless expressly stated in a wri ting s ign ed by the waiv ing party. No de lay or omission in the exercise
o any right, power or remedy under or for this Agreement shall impair such right, power or remedy
or be construed as a waiver of any breach of this Agreement . Any waiver of a breach of this
Agreement or any failure to claim a breach of this Agreement shall not be treated as a waiver o any
subsequent breach o this Agreement, Whether or not of the same provision .
Sl* gnature Page - next page]
12
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13
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13
EXHIBIT A
FORM OF INSTRUMENT OF ACCESSION
INSTRUMENT OF ACCESSION
WHEREAS , the undersigned Transferor and the undersigned Transferee desire to have the
Transferor' s Transfer of its Membership Interest to the Transferee pursuant to the attached 1" nstrument
(the "Transfer") be effect ive under the Balt imore RE, LLCO pera ting Agreem ent datedaso f May 12 ,
2015 as it heretofore may have been amended (th e " OPeratingAgreement
") ;
NOW, THEREFORE :
1 . Each of the Transferor and the Transferee (1) hereby acknowledges the Transfer to the
Company and (11) represents and warrants to the Company that such Transfer is in
accordance with the Operating Agreement and all applicable laws .
2 .9 The Transferee hereby agrees to be bound by the Operating A greement with respect to
the Transferred Membership Interest . Without Iimiting the generall'oty of the
foregoing, the Trans feree hereby acknowledges to the Company that the Transferee
shall not be entitled to adm iss ion as a Member w ith respect to such Transferred
Interest except as provided in the Operating Agreement .
3 -s Capitalized terms used but not otherwise defined herein shall have the meanings
rovided in the Operating Agreement .
IN WITNESS WHEREOF , the Transferor and Transferee have executed this instrument
under seal this day of
Transferor :
( SEAL)
Transferee :
(SEAL)
14
...... . .. . . . . . . . . . . . .
SCHEDULE
OF
OWNERSHIP
Date : May 12 , 2015
Member or
Unadmitted Percentage
Name Transferee Interests
Kevin Jessup Member 25 * 0%
Richard Mossman Member 25 -60 %
Neil Cornatzer Member 250 0 %
Oak Ridge Development, LC Member 25 ,aO%
15
ALLOCATION ADDENDUM
TO
OPERATING AGREEMENT
OF
BALTIMORE RE , L C
Thi s Allocation Addendum shall be deemed a part of the Operating Agreement referred to
above for all purposes .
1 . Definitions . Whenever used in this Addendum or elsewhere in this Agreement, the
following terms shall have the meaning assigned to them in this Paragraph 1 except to the extent
herwise provided in this Agreement :expressly ot
Ad-justed IcLaMital Account Deficit . "Adjusted Capital Account Deficit" shall mean with
respect to any Member, the deficit balance , if any, in such Member' s Capital Account as of the end of
the relevant fiscal year, after givin g effect to the following adjustments :
(i) Credit to such Capital Account any amounts which such Member is obligated
to restore or is deemed to be obligated to restore pursuant to the penulti' mate sentences of
Regulations Sections 1 . 704 - 2 (g)(t) and 1 . 704 �2 (i)( 5 ) ; and
Debit to such Capi tal Account the items described inn Regulations Sections
107041 (b) (2) (ii) (d) (4) , 1 . 704 - 1 (b) (2)(ii)(d)( 5 ) , and 1 * 704 - 1 (b) (2) (ii)(d) (6) .
The foregoing definition of Adjusted Capital Account Deficit is intended to comply with the
provisions of Regulations Section 1 . 704- and shall be interpreted consistently therew ith.
Capital Account. "Capital Account" shall mean with respect to any Member, the Capital
Account maintained in accordance with the following provisions :
(i) o eac er s Capital Account there shall be credited such Mem er' s
apital Contributions , such Member' s di strib uti ve share of Profits and any items in the nature
of income or gain whic or
h are specially allocated pursuant to Addendum Paragraphs 2 , 3 4 ,
and the amount o any Company liabilities assumed by such Member or which are secured Y
any Company Property distributed to such Member.
To ea, ch Mem er s Capital Account there shall be debited the amount of cash
and the GrossIsset Value o any Company Property distributed to such Member pursuant to
any provision of this Agreement, such ember' s distributive share of Losses and any items in
the nature of expenses or losses which are specially allocated pursuant to Addendum
Paragraphs 2 , 3 , or 4 , and the amount of any liabilities of such member assumed by the
Company or which are secured by any property CIOntributed by such Member to the Company.
In determining the amount o
f lb
any liability for purposes of clauses (i) and (ii)
16
above , there shall be taken into account Code Section 752 (c) and any other applicable
provi sions of the Code and Regulations .
The foregoing provisions and the other provisions of t his Agreement relating to the
malntenance of Capital Accounts are Intended to comply with regulations Sections 1 ,, 704mw 1 (b) and
17042 and shall b e interpreted and applied in a manner consistent with such Regulations . The
Managers shall (i) makea nya djustments that are necessary or appropriate to maintain equality
betweentheCapital Accounts of the Members and the amount of Company capital reflected on the
COmpany' sbalances heet. ascompute d for book purposes in accordance with Regulations Section
1704 - 1 (b) (2) (iv) (g) , and ii) make any appropriate modifications in the event unatic ipated events
or 1 .might otherwise cause this Agreement not to comply with Regulations Sections 1 . 704- 1 (b) 704 -
2 .0
Depreci ation . "Depreciation" shall mean for each Fiscal Year an amount e qual to the
depreciation, amortNW�W izat ion, or other cost recovery deduction allowable with respect to an y asset for
such year or other perio d, except that if the Gross A sset Value of an asset differs from its adjusted
I asis for Federa l income tax purposes at the beginning of such year or other period, Depreciation
shall be an amount which bears the same ratio o such beginning Gross Asset Value as the Federal
income tax depreciation, amortization, or other cost recovery deduction for such year or other period
bears to such beginning adjusted tax basis ; provided, however, that if the aisusted basis for Federal
income tax purposes o an asset at the begi nning o such year or other period is zero , Depreciation
shall be determined with reference to such begi nning Gro s s Asset Value using any reasonable
method selected y the Managers .
Gross Asset Value. "Gross Asset Value" shall mean, wi th respect to any asset, the asset' s
adjusted basis for federal income tax purposes , except as follows :
(i) The init ial Gross Asset Value of any asset contributed by a Member to the
Company shall be the gross fair market value of such asset, as specified in this Agreement or
(i f not so specified) as determined by the Managers ;
(ii) The Gross As set Values of all Company assets shall be adjusted toe ual their
respective gross fair market values , as determined by the Managers , as of the following times :
(A) the acquisttio n of an additional interest in the Company by any new or existing Member
in exchange for more than a de minimis Capital Contribution; (B) the dstri-6
ibution by the
Company to a Member of more than a e min im is amount of COMpany roperty as
consideration for an interest in the Company ; and (c) the liquidation oftheCompanywi thin
the meaning of Regulations Section 1 . 704 - 1 (b) (2) (ii)(g) ; provided, however that adjustments
rmine that such
pursuant o clauses (A) and (B) above shall be made only if the Managers dete
adjustments are neces3ary or appropriate to reflect the relative economic interests of the
Members in the C ompany ;
The Gross Asset Value of any Company asset distributed to any Member shall
be adjusted to equal the gross fair mar .ket value of such asset on the date of distribution as
determine d by the Managers ; and
17
(iv) The Gross Asset Values of Company assets shall be increased (o r decreased) to
reflect any adjustments t o the adj usted basis of such assets pursuant to Code Section 734(b) or
Code S ection 743 (b) , but only to the extent that such adj ustments are taken into account 1
in
determining Capital Accounts pursuant to Regulations Section 1 . 704 - 1 (b) (2) (i v) (m) and
clause (vi) of the definition of Profits and Losses and Addendum Paragraph 3 (g) � provided,
however, that Gross Asset Values shall not be adjusted pursuant to this clause (iv) to the
extent the Managers determine that an adjustment pursuant to clause (ii) above is necessary or
appropriate in connection with a transaction that would otherwise result in an adjustment
pursuant to this clause (iv) .
If the Gross Asset Value of an asset has been determined or adjusted pursuant to C 16
lauses (i) , (ii) ,
or (iv) above ,, such Gross Asset Value shall thereafter be adjusted by the Depreciation taken into
account with respect to such asset for purposes of computing Profits and Losses .
Nonrecourse Deductions . "Nonrecourse Deductions" shall have the meaning provided in,
and shall be determined in accordance with, Regulations Section 1 ,, 704- 2 .
Nonrecourse Liability . "Nonrecourse Li" abili ty" shall have the meaning provided . in, and
shal l be ietermined in accordance with, Regulations Section 1 . 704 -2 b 3 ) .
Partner Nonrecourse Debt. "Partner Nonrecourse Debt" shall have the meaning provided in
Regulations Sect40 ion 1 . 704-2 .
Partner Nonrecourse Debt Minimum G-M-_ ain. "Partner Nonrecourse Debt Minimum Ga in"
shall have the meaninrovi e in, and shall be determined in accordance with, Regulations Section
1 . 704 -2 .
Partner Nonrecourse Deductions . "Partner Nonrecourse Deductions" shall have the
meaninrovi e i n, and shall be determined in accordance with, Regu lations Section 1 . 704 -2 .
Partnership Minimum Gain. "Partnership Minimum Gain" shall have the meaning provide_000�1 .-MEMENNEWWN
in,, and shall e determ1b .0
ined in accordance with, Regulations Section 1 . 704 - 2 .
Profit or Loss . "Profit" or "Loss" shall mean for each Fiscal Year an amount equal to the
Company' s taxable income or loss for the Fiscal Year, determined in accordance with Code Section
a) (for this purpose, all items of income , ga in, l oss or deduction required to be stated separately
pursuant to Code Section 703 (a) ( 1 ) shall be included i* n taxable income or loss) , with the following
adjustments :
(i) Any income o1b
f the Company that is exempt from federal income tax and not
otherwise takeni" nto account in computing Profits and Losses pursuant to this definition shall
be added to such taxable income or loss ;
18
Anyex pen i ur es of the Company described in Code Section 705 a 2 B) or
treated as Code Section705 (a)(2) (B) expe 1t res pursuant to Regulations Section 1 . 704 -
I (b2iv and not otherwise taken into account i* n computing Profits and Losses pursuant
t o this definition, shIal be subtracted from such taxable income or loss ;
III) In the ev ent the Gross Asset Value of any Co mpany Property is adjusted
pursuant to clauses (11) or (iii) of the definition of Gross Asset Value the amount of such
adjustment shall be taken into account as gain or loss from the disposition of such asset for
purposes of computing Profits and Losses ;
(iv) Gain or loss resulting from any disposition of Company Property with respect
to which gain or loss is recognized for federal income tax purposes shall be computed by
reference to the Gross Asset Value of the prope rty di" sposed of, notwithstanding that the
adjusted tax basis of such property differs from its Gross Asset Vaue *l
V) In lieu of the depreciation, amortization, and other cost recovery deductions
taken into account in computing such taxable income or loss ,, there shall be taken Into account
Depreciation for such Fiscal Year computed in accordance with the defin' t ' on thereof;
VI) To the extent an adjustment to the adjusted tax basis of any Company Property
pursuant to Code qec tion 7 -14 (1 ) or Code Section 743 (b) is required pursuant to Regulations
Section 1 . 704mal (b)(2 )(iv) (m) (4) to he taken into account in determining Capital Accounts as a
result o a distribution other than in liquidation o em er s intere st ineom any, the
amount of such adjustment shall e treated as an item of gain if the adjustment increases the
basis o f the asset) or loss if the adj ustment decreases the basis o e asset) from the
disposition o the asset and shall be taken into account for purposes of computing Profits and
Losses ; and
vii otwithstanding any other provisions o is definition, any items which are
specially allocated pursuant to Addendum Paragraphs 2 , 3 into, or 4 shall not be taken account
i n computing Profits and Losses .
The amounts o e items o Company income, gain, loss , or deduction to be special ly
a llocated pursuant to A ddendum Paragraphs 2 , 3 , or 4 shall be determined by applying rules
analogous o clauses (i) throug vi) above .
2 . Limitation on Loss Allocations . Losses under Section 7 . 1 shall not be allocated to a
Member to the extent i) such allocation would create or increase an Adjusted Capital Account
Deficit for such Member at the end of any Fi scal Year and (i i) such Losses can be allocated to one or
more other Members w16 ithout creating or increasing an Adj usted Capital Account Deficit at the end
o any FiscearY for such other Member( s) ; i 6 nstead, such Losses shall , to such extent, be allocated
to such other Member(s) , shared among them (if more than one rtion) in propo to the maximum
amount of Losses that can be allOcated to each such other Member without so creating or increasing
19
tal Account Deficit for such other Member .an Adjusted Capi
3 ,o Special Allocations . The following special allocations shall be made in the following
order :
(a) Minimum Gain Chargeback. Except as otherwise provided in Regulations Section
1 . 704 .2 (� , notwl* thstanding any other provision of this Agreement, if there is a net decrease i" n
Partnership Minimum Gain during any Fiscal Year, each Member Shall be specially allocated items
of Company income and gain for suchF iscal Year (and, if necessary, subsequent F iscal Years) in an
amount equal to such Member' s share of the net decrease in Partnersh ip M in imum Ga in, de termined
in accordance with Regulations Section 1 . 704 -2 (g) . Allocations pursuant to the previous sentence
shall be made in proportion to the respective amounts required to be allocated to each Member
Pursuant thereto . The items to be so al located shall be determined in accord ance with Regulations
S ections I . 704 -2 (� (6) and 1 . 704 -2 (j ) (2) . Th i s Paragraph 3 (a) is Intended to comply with the
minimum gain chargeback requirement in Regulations Section 1 ,, 704ww2 (f) and shall be interpreted
consistently therewith.
(b) Partner Minimum Gain Chargebacke Except as otherwise provided in Regulations
Section 1 . 704 � 2 (1) (4 ) � notwithstanding any other provis ion of th is Agreement, if there i s a net
decrease in Partner Nonrecourse Debt Minimum Gain attributable to a Partner Nonrecourse Debt
ear, each Member who has a share of the Partner Nonrecourse De
during any Fiscal Y t
M i nimum
Gain attributable to such Partner Nonrecourse Debt, determined in accordance with Regulations
Section 1 . 704 - 2 (i) ( 5 ) , shall be specially allocated items of Company income and gain for such Fiscal
Year (and, if necessary, subsequent Fiscal Years) in an amount equal to suc erson I s share of the net
decrease in Partner Nonrecourse Debt Minimum Gain attributable to such Partner Nonrecourse Debt,
determined i* n accordance wi0
th Regulations Section 1 . 70 4-2 (i) (4) . Allocati ons pursuant to the
previous sentence shall be made iropon prtion to the respective amount s required to be allocated to
each Member pursuerethto . The items to be so allocated shall be determined in accordance wi th
Regulations Section 1 . 704 -2 (i) (4) and 1 . 704 -2 (j ) (2) . This Paragraph 3 (b) is intended to comply with
the minimum gain c argeack requirement in Regulations Section 1 . 704 -2 (1) (4) and shall be
interpreted consistently therewith .
C ualifie d Income Offset . In the event any Member unexpectedly receives any
adjustments , allocations , or distributions described in Regulations Section 1 , 704,ml b 2) (ii)(d) (4) ,
Section 1 ,, 704- 11 or Section 1 . 704 - 1 (b) (2) (ii) (d) (6) , items o Company income and
gain shall be specially allocated to each such Member in an amount and manner sufficient to
eliminate , to the extent required by the Regulations , the Adjusted Capital Account Deficit of such
Member as quickly as possie , rovi ed that an allocation pursuant to this Paragraph 3 (c) shall be
made only if and o the extent that such Member would have an Adjusted Capital Account Deficit
after all other allocations provi ded for in this Agreement have been tentatively made as if this
P aragraph 3 (c) were not in this Agreement .
(d) Gross Income Allocation . In the event any Member has a deficit Capital Account atID
the end ofany Fiscaear whch is in excess of the sum of (i) the amount such Member is obligated
20
to restore pursuant to any provision of thi s Ag reement, and (n) the amount such Member is deemed
to be obligated to restore pursuant to the penultimate sentences of Regulations Sections 1 . 704ma
1 . 704 -2 (i) (5 ) , each suchM ember shall be specially allocated items of Company income
and gain in the amount of such excess as quickly as possible, provided that an allocation pursua nt to
this Paragraph 3 (d) shall be made only if and to the extent that such Member would have a deficit
Capital Account in excess o
f such sum after all other allocations provided for in this Agreement have
been made as if Paragraph 3 (c) and this Paragraph 3 (d) were not in this Agreement .
e) Nonrecourse Deducti ons . Nonrecourse Deductions for any Fiscal Year shall be
sp ecially allocated to the Members in the PProortions provided in Section 7 . 1 .
(f) Partner Nonrecourse Deductions ,.. Any Partner Nonrecourse Deductions for any Fiscal
Year shall be specially allocated to the Member who bears the economic risk of loss with res pect to
such Partner Nonrecourse Deductions are attributable inthe Partner Nonrecourse Debt to which
accordance with Regulations Section I * 704o=2 (1* )( 1 ) 8
(g) Section 754 Adjustments . To the extent an adjustment to the adjusted tax bas is of any
Comiany asset pursuant to Code Section 734 (b) or Code Section 74 3 (b) is requ ired , pursuant to
I egulati" ons Sections IV M 2) or 1 . 704pm1 (b) (2) (iv) (mtointo, be taken account in
determining Capital Accounts as the result of a distribution to a Member in complete liquidation of
such Mem er s terest in the Company, the amount of such adjustment tO the Capital Accounts shall
be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the
adjustment decreases such basis) and such gain or loss shall be specially allo cated to the Members in
the proportions provided in Section 7 . 1 in the ev ent that Regulations Section 1 . 704-2 2 IV) (m) (2)
appl i es , or to the Member to whom such istribution was made in the event that Regulat ions Section
1070 2 IV plies .
(h) Allocations Relating to Taxable Issuance of Interests . Any income , gain, loss, ore
eduction realized as a direct or indirect result of the issuance of an interest by Company to a
Member (the A ssuance Items @S ll be allocated among the Members so that, to the extent
ble the net amount of such Issuance Items , together with all other allocations under thisossi
Agreement to each Member, shall be equal to the net amount that would have been allocated to each
such Member if the Issuance Items had not been realized .
(i) Managers Discretionary Authority for Compliance . The Managers are authorized in
their discretion to allocate items o income , gain, losseduction, Code Section 705 a 2 B )
expenditure including . without limitation an expenditure treated under Code Section 704 (b) as a
Code Section 705 (a ff) (2) (B) expenditure) , or credit for any Fiscal Year delerently than otherwise
provid ed for in th is Agreement to the extent that allocation in the manner provided for in this
Agreement, in the opinion of the professional tax advisor to the Company (tax counsel or
accountants) , would cause the determinatI ons and allocations of each Mem er s distributive share of
incomeal0
n, loss, deduc tion, Code Section 705 a 2 B expenditure , or credit (or item ereo f not
to be permitted y Code Secti on 7and the Regulations thereunder. Any allocation made
pursuant to this Paragraph 3 (i) shall be deemed to be a complete substitute for any allocation
21
otherwise provided for in this Agreement and no amendment of this Agreement or approval of any
0erth Member shall be required therefor .
4 . Curative Allocations. The allocationsset firth in Paragraphs 2 , 3 (a) , 3 (b) , 3 (c) , 3 (d) ,
3 e) , 3 (f) , and 3 (g) (the "Regulatory Allocat * ons") are in tended to comply with certain requirements
of the Regu lations . It is the intent of the Members that, to the extent possible , all Regulatory
Allocations shall b e off set either with other Regulatory Allocations or with special al locations of
other items ofC ompany income, gain, l oss , or deduction pursu ant to t his Paragraph 4 . Therefore ,
notwithstanding any other provisi on of th is Agreement (other than the Regulatory Al locations) , the
Managers shall make such offsetting special al locations ofc ompany income , gain, loss, or deduction
in whatever manner they d etermine appropriate so that, after such offsetting al locat ions are made ,
eachM ember' s Capital A ccount balance is , to the extent possible , equal to the Capit al Account
balance such Member would have had if the Regulatory Allocat ions were not part of this Agreement
and a90
ll Company items were allocated pursuant to the other provisions of this Agreement. In
exercising their d iscretion under th is aragraph 4 , the Managers shall take into account future
Regulatory Allocations under Paragraphs 3 (a) and 3 (b) that, although not yet made, are likely to
offset other Regulatory Allocations previously made under Paragraph 3 (e) and 3 (� .
5 . Other Allocation Rules .
(a) For purposes of determining the Profits , Losses , or any other items allocable to any
period, Profits , Losses , and any such other items shall be determined on aaly,dl monthly, or other
basis , as determined by the Managers using any permissible method under Code Section 706 and the
Regulations thereunder .
(b) o the extent permitted by Section 1 . 704 - 2 (h) (3 ) o the Regulations , the Managers
shall endeavor to treat cash dis .ribut ions as hav ing been made from the proceeds of a Nonrecourse
Li abi lity or a Partner Nonrecourse Debt only to the extent that such di stributions would cause or
increase an Adjusted Capital Account Deficit for any Member .
C) If d uring a Fiscal Year, i there is a distribution, contrib ution, or other event which
changes the ratio that a Member ' s Capital Account balance bears to the sum of all the Members =
Capital Account balances or (ii) any other event occurs which results in a change during the Fiscal
Year i* n any ember ' s St in the C ompany within the meaning of Code Sectionthe
allocations of Profit, Loss , and other items of income , gain, loss , deduction and credit of th e
Company for such Fiscal Year shall take into account such change using any method permitted y
Code Section 706 (d) that is selected by the Managers in their discretion, and the Managers Shall
prepare a revi sed Schedule of Ownership o reflect the new ownership of Membership Interests .
6 . Tax Allocati* ons : Code .Sectioniiiiiiiiiiiiiiiiiiiiillll,,11,,Illlm--... ..-� C - 0 In accordance with Code Section 704(c) and
the Regulations ther eunder , income , gain, loss , and deduction with respect to any property
contributed to the capital o f the C ompany shall, solely for tax purposes , be allocated among the
Members so as to take account of any variation between the adj usted basis o such property to the
22
Company for Federal incomeaxt purposes and its initial Gross Asset Value .
In the event the Gross Asset Value of any Company asset is adjusted pursuant to clause (i i) of
the definition of Gross Asset Value, subsequent al locations of income, gain, loss , and deduction with
respect to such asset shall take account of any variation between the adj usted basis of such asset for
Federal income tax purposes and its Gross Asset Value in the same manner as under Code Section
704(c) and the Regulations thereunder .
The Managers shall have the maximum discretion and flexibil ity permitted by Code Section
704(c) and the Regulations thereunder, including without limitation making curative allocations over
a reasonable period of time as perrnitted by Regul ations Section 1 . 704 - 3 (c) (3 )(ii) , disregarding the
general Ii mitation on c h aracter as permitted by Regulations Section 1 . 704 � 3 (c) (3 ) (iii)(B) , us ing the
remedial allocation method permitted by Regulations Section 1 . 704mo3 (d) , and disregar ding t he
application of- Section 704 (c) or using one of the other options permitted by Regulations Section
1 . 704 - 3 (e) ( I ) in the case of a " small disparity" .
Allocations pursuant to this Paragraph 6 are solely for purposes of Federal , state ,, and lo cal
taxes and shall not affect, or in any way be taken into account in computing, any Member' s Capital
A ccount or share of Profits , Losses , other items , or distributions pursuant to any provision of this
Agreement .
23
. M
PURCHASE AGREEMENT AND ASSIGNMENT OF MEMBERSHIP INTERESTS
THIS PURCHASE AGREEMENT AND ASSIGNMENT OF MEMBERSHIP INTERESTS (the
"Agreement") is made and entered into on March 3 1 , 2017� by and among Kevin Jessup ("Jessup ")
a resident of the state ofNorth Carolina, Richard Mossman ("Mossman11a), resident ofthe state of
North Carolina, Neil Cornatzer (" Cornatzer") , a resident o fthe st ate fNorth Carolina, Robert M.
Baldwin , III (" Baldwin '91) , a resident of th. e state of. North Carolina and Kyle Winslow
("Winslow ") , a resident of the state ofNorth Carolina . Winslow is referred to herein as the "Buyer"
and Jessup, Mossman, Cornatzer, and Baldwin are referred to herein as the " Sellers" .
WITNE S SETH :
6
WHEREAS , Baltimore RE , LLC , a North ' Carolina limited liability company ( "Baltimore") is
currently owned as follows ,:
Member Membership Interest
Kevin Jessup 25 %
Richard Mossman 25 %
Neil Cornatzer 25 %
Robert M . Baldwin, III 25 %
WHEREAS , the parties lave agreed that Buyer will purchase a portion of the interest of
Sellers in Baltimore , as more particularly set forth in this Agreement ; and
NOW!, THEREFORE , in consideration of the mutual covenants and agreements herein
contained, the legal sufficiency and adequacy of which are hereby expressly acknowledged, the
parties hereby agree as follows :
1 . FFMENT TO S ELL AND Pi.1RCHASsoE : f the date hereof, Sellers hereby
sell , assign and transfer i ) a 20 . 00 % Members hip Interest in Balti more to Buyer in . exchange for a
purchase price o eventy Three Thousand Nine Hundred Thirty Six and 80/ 100 Dollars
a. Upon delivery of a cash payment of $ 18 , 484 . 20 Jessup hereby sells, assigns
0 and transfers a 5oMembership Interest in Baltimore to Winslow .
b -6 Upon delivery of a cash payment of $ 18 , 484 . 20 Mossman hereby sells ,
assigns and. transfers a 5oMembership Interest in Baltimore to Winslow .
co Upon delivery of a cash payment of $ 18 , 484 . 20 Cornatzer hereby sells ,
assigns and. transfers a 5 % Members hip Interest 10n Baltimore to Winslow .
d -6 Upon delivery of a cash payment of $ 18 , 484 . 20 Baldwin hereby sells, assigns
and transfers a 5 % Membership Interest it Baltimore to Winslow .,
2 ,0 REPRESENTATIONS AND WARRANTIES OF SELLERS : Sellers represent and
warrants to Buyer as follows :
a. Sellers have full and valid title to the Membership Interests in Baltimore set
forth above , and upon payment of the purchase price , Buyer shall have full and valid. title to
such interest, free and etear of all liens , pledges, claims, options , charges, escrows,
mortgages,, security interests , voting agreements or trusts , rights of first refusal or other
encumbrances or claims of any nature whatsoever, other than the existing Operating
Agreement of Balti more dated May 12 , 2015 (the "Operating Agreement") .
b . Sellers have full power and authority to enter into and perform their
obligations under this Agreement ; Sellers do so freely and voluntarily and solely for the
consideration recited herein ; and the execution and delivery of this Agre ement and the
consummation of the transactions contemplated hereby shall be valid and binding upon
Sellers .
3 . REPRESENTATIONS AND WARRANTIES OF BUYER : Buyer represents and
warrants as follows :0
a.. Buyer has full power and authority to enter into and perform its obligations
under thi.0s Agreement ; Buyer does so freely and voluntarily and solely for the consideration
recited herein ; and the execution and delivery of this Ag reement and the consummation of-
.6the transactons contemplated hereby shall be valid and binding upon Buyer.
Is
4 .0 BENEFIT : This Agreement shall be binding upon and inure to the benefit of- the
parties hereto , their heirs and personal representatives, successors and permitted assigns .
5 . OTHER DOCUMENTS : The parties shall also execute an Instrument o ccession
simultaneously with the execution of this Agreement . The Schedule o Ownership attached hereto as
Exhibit A reflects the ownership o altimore following the sales and. purchases described herein and
shall be al�11-fixed to the Operating ) greement to' reflect the new Percentage Interests of all persons in
altimore . The parties agree to execute such other documents as may be necessary for the
implementation and consummation of this Agreement and the warranties herein contained .
6 ,o ENTIRE AGREEMENT : This -Agreement constitutes the only agreement between
the parties as to the subject matter hereof and contains all o e terms agreed upon with respect to
the subj ect matter hereof.
7 ,6 ASSIGNABILITY : No party may assign its rights and, obligations under this
Agreement .
8 ,0 CONSTRUCTION : This Agreement shall be construed and enforcedi" n accordance
with the laws of the State of North Carolina.
IN WITNESS WHEREOF , the parties have caused this Agreement to be executed UNDER
SEAL on.. the day and year first above written .
(SEAL)
Kevin B . Jessup
( SEAL)
Richard Mossman
( SEAL)
Neil Cornatzer
(SEAL)
Robert M . Baldwin, III
(SEAL)
Kyl inslow
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84 CONSI"RUC �I� I�.)N : Thi"S A -N ---ree nent
W1 . s #�al ( be cor� struet� and en �"c���ced i �� a�e,c�rt� �nc�tf 11. 1 ftle- of, North Car(-)Iaws o thelicz-f
iN VV (TNESS W ,Hu,..7,, RF,,O..Fthe
parties I� av� caused t1l "SCLA �r�em �nt IJca��
NAOL70 ,to be
L t�a� lid d �7 �= R.
S .E.Afirst above.
ay, an . ..
year Written .
Ke, V n B . J'essu
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'Nel* .l Coriiatze..r
kill
Robert 11st . BaId,w-in , [ I �
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(SEAf
Inslaw
EXHIBIT A
SCHEDUL OF' O"ERSHIP
Date :: March 3 1 , 2017
Name Member or U'nadmitted Percentage Interests
Transferee
Kevin B . Jessup Member 20 ,900%
Rich. ard Mossman Member 20000%
Neil Cornatzer Member 20 ,000%
Robert M . Baldwin , III Member 20000 %
Kyle Winslow Member 20 * 00%
INSTRUMENT OF ACCESSION
VVHEREAS , the undersigne d Transferors and the undersigned Transferee desire to have the
Transferor ' s Transfer their Membership Interest to the Transferee pursuant to the attached instrument
(the "Transfer") be effective under the Baltimore RE, LLC Operating Agreement as i* t heretofore may
have been amended (the "Operating Agreement
NOW, THEREFORE :
1 . The Transferors and the Transferee (1) hereby acknowledge the Transfer and (ii )
represents and warrants to the Company that such Transfers are in accordance with
the Operating Agreement and all applicable laws .
2 .0 The Transferee hereby' agrees to be bound ' by the Operating A- greementw' ith respect
to the Transferred Membership Interest . Without limiting the generality of the
foregoing, the Transferee hereby acknowledges to the Company that the Transferee
shall not be entitled to admission as a Member with respect to such. Transferred
Membership Interest except as provided in the Operating Agreement .
3 . Capitalized terms used but not otherwise defined herein shall have the meanings
provided in the Operating Agreement.
IN WITNESS WHEREOF, the Transferors and Transferee have executed this instrument
under seal this 3 1 St day of March 2017 .
Transferors :0
( SEAL)
Kevin Jessup
(SEAL)
Richard Mossman
( SEAL)
Neil Cornatzer
( SEAL)
Robert M . Baldwin , III
Transferee :
(SEAL)
Kyle Winslow
RtJ'.ME 'N 'F11 O-F ACCESS.ION
WH F-4REA.�,,, tlie- undersigned and ti �ie � r�er� igr��e( 'T'ra�� sf�reeransferorsdesire to have the
I'ransferor" s Transfer th eir 'Membersfil' Interest to the `I"ransferee pursuaii-t to. the attached instrur' nent
( t. ie " ' Trcotns-f-er"'
be effecti ��e under t.lie 'Bal'U` 1110re R'E., t.,,,L,C Ue ratn� At�xet�,kment � s dt Iz e�-etofarc m�};
have. been ('the- "`(3peratiia.g Agreement"' .,,-
NqOWf, T.. ' fl'ER.F,.,.',FORE, :
! , Thy Fr�nsl �rors a ��d t e T'rensfer� e ( I '', 11,1111'i.ere. �y a.ckfc� v�Flc�dge the Transfer an-d (. u )
represents, and , warrants to ,the C, oi ali_ ,v that sLich Transfers are. in accoordance wi* t '
h
the C3�eratin Ar �ment a��c� a � applicab-1p [aws .
2 . The �ransferee liereby agrees. to be bound bv the Operati*_ng Agreement with respect
to ti e `T'ransf'erred M.embership in, terest - . Without Iimiting the �eneralit�r ref' the
tc+re�oin � , tl�e ''��ra�� �f�;r�e hereby acknowled�es tc� the �;Qznpany that the Trans-Iferee
s�� � ll nit be.. � �atit� �d to aGdrt� issi�r� as � Meimber with. respect to sucli `�'ransferred
nterest except as prov- j* ded' I" ll the Operat .tng Agreement.
3 .x Ca.pita ( ize:d terms used but �n�t c�theru�ise defined her� i r� � ha11 ��av� the rneaninc;s
pro �Fided in th-e (3�eratin � Agroot � n..
t.
IN ITN SS E lwK.E F I the TtAansteror� anc� ran s�er�c� I� av � ��, ��.uted this instrument
under seal this 3I st daV of March. COI ? .
T -rans' ftrors, :
'SL L"
L)
K,evinJ. essu.p
... . .. ------- ------- AL
--- , ,'. , -------- ( S F-.0
Richard Os ' pan_ 7
,
s
( SEAIe)
77 ------------ .. ....
'N'
e i -atzer
---------------
C� 0 ert M . a -win ., lei
ransf- eree.
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Tranzferor - s Traust" r 11- -4m- er.,
I. ra as t'er"" be e- `,m"-`6L,'e' Ctive tnider th,, eBal,timore- L.. br. e -N Operaftng Astreein nt as it tot uia
eimartin Ri leenie ave been an.ien, ded. (the lit
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I IT
PURCHASE AGREEMENT AND ASSIGNMENT OF MEMBERSHIP INTERESTS
THIS PURCHASE AGREEMENT AND ASSIGNMENT OF MEMBERSHIP INTERESTS
(the "Agreement") is made and entered into on July , 2021 bly and among Neil Comatzer
(" Seller") , and Robert M. Baldwin, I II ("Buyer") .
WITNESSETH :
WHEREAS , Baltimore RE , LLC , a North Carol ina l imited liability company (` Baltimore")
is currently owned as follows :
Mem- ber Membership, Interest
Kevin B . Jessup 20000%
Kyle Winslow 20 .* 00%
Robert M . Baldwin, III 200,00%
Neil Comatzer 40000%
WHEREAS , the parties have, agreed that Buyer wilt purchase the a portion of the interest of
Seller in Baltimore-, as more particularly set forth in this Agreement ; and
NOW,, THEREFORE, . i n consideration of the mutual covenants and agreements herein
contained, the legal sufficiency and adequacy of which are hereby expressly acknowledged, the
parties hereby agree as follows :
1 .6 AGREEMENT TO SELL AND PURCHASE : As of the date hereof but effective as
of July 1 , 202 1 , Seller hereby sells ,, assigns and transfers a 10 . 0% Membership Interest in Baltimore
to Buyer in exchange for a purchase price of Two Hundred Fifty Thousand Dollars ($250 , 000) ,
payable by delivery of cash as of the date hereof.
2 . REPRESENTATIONS AND WARRANTIES OF SELLER : Seller represents and
warrants to Buyer as follows :
a. Seller has full and valid title to the Membership Interests in Baltimore see
forth above!, and upon payment -of the purchas e price, the Buyer shall have full and valid title
to such interest', free and clear of all liens, pledges , claims, options , charges , escrows,
mortgages., security interests , voting agreements or trusts , rights of first refusal or other''
encumbrances or claims of any nature whatsoever, other than the existing Operati ng
Agreement of Baltimore dated May 12 , 2015 (the "Operating Agreement") .
b . Seller has full power and authority to enter into and per form his obligations
under this Agreement; Seller does so freely and voluntarily and solely for the consideration
recited herein; and the execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby shall be valid and binding upon Seller.
3 -a REPRESENTATIONS AND WARRANTIES OF BUYERS : Buyer represents and
warrants as follows :
a. Buyer'
has full power and authority to enter into and perform his obligations
under this Agreement ; Buyer does so freely and voluntarily and solely for the consideration
recited herein; and the execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby shall be valid and binding upon Buyer.
4 . BENEFIT : This Agreement shall b e binding upon and inure to the benefit of the
parties hereto , their heirs and personal representatives, successors and permi tted assig ns .
719 OTHER DOCUMENTS : The parties shall also execute an Instrument of Accession
si multaneously wi th the execution of this Agreement. The Schedule of Ownershi*p 'attached hereto as
Exhl' bl* t A reflects the ownership of Balti more following the sales, purchases and transfers and
purchases described herein and shall be affixed to the Operating Agreement to reflect the new:
Percentage Interests of all persons in Baltimore . The parties agree to execute such other documents
do
as may be necessary for the implementation and consummation of this Agreement and the warranties
herein contained.
8 .0 ENTIRE AGREEMENT : This Agreement constitutes the only agreement between:
the parties as to the subject matter hereof and contains all of the terms agreed upon with respect to
the subject matter hereof.
9 . ASSIGNABILITY : No party may assign its rights and oblig ations under this
Agreement.
I O -W CONSTRUCTION : Theis Agreement shall be construed and enforced in accordance
with the laws of the State of North Carolina.
IN WITNESS WHEREOF , the parties have caused this Agreement to be executed UNDER
SEAL on the day and year first above written.
Buyer :
(SEAL)
or
Ro eft kT., III
Seller:
00000R
1- 0&^ (SEAL)
Nei* I Comatzer
EXHIBIT A
SCHEDULE OF OWNERSHIP
Date : July 1 , 2 02 1
Name Member or Unadmi' tted Percentage Interests
Transferee
Kevin B . Jessup Member 20o00%
Neil Comatzer Member 30 -900%
Robert M . Baldwin!, III Member 30 ,w00%
Z.!
Ky. le Winslow Member 20 * 00%
INSTRUMENT OF ACCESSION
WHEREAS , the undersignedTransferors and the undersigned Tr
ansferees desire to have the
Transferors Transfer certain Membership Interest to the Transferees pursuant to the attached
instrument (the "Transfer") be effective under the Baltimore RE, LLC Operating Agreement as lot
heretofore may have been amended (the "Operating Agreement") ;
NOW, THEREFORE :
1 . The Transferors - and the Transferees (I' ) hereby acknowledge the Transfer to the
Company and (1* 1' ) represents and waffants to the Company that such Transfer do is in
accordance with the Operating Agreement and all applicable laws .
2 . Each of the Transferees hereby agree to be bound by the Operat i ng Agreement with
respect -to the Transferred Membership Interest. Without limiting the generality of
the foregoing, each of the Transferees hereby acknowledge to the Company that the
Transferee shall not be entitled to admission as a Member with respect to such
Transferred Membershi p Interest except as provided in the Operating Agreement.
3 . Capitalized terms used but not otherwise . defined herein shall have the meanings'
provided in the Operating Agreement .
IN WITNESS WHEREOF, the Transferors and Transferees have executed this instrument
under seal this 1 ,),' th day of July 2021 .
Transferors
doe- , `NEW
(SEAL)
Neil Comatzer
Trans e
(SEAL)
Ro . Baldwin, III