Llc Operating Agreement Template Tennessee

AMENDED AND RESTATED OPERATING AGREEMENT OF [COMPANY FULL LEGAL NAME], LLC

(A Tennessee Limited Liability Company)

DOCUMENT CONTROL INFORMATION:

• Document Identifier: OA-TN-[YEAR]-[SERIAL]
• Effective Date: [Effective Date]
• Version Number: 1.0
• Governing Jurisdiction: State of Tennessee (Tennessee Revised Limited Liability Company Act, Tenn. Code Ann. § 48-249-101 et seq.)

---

STATUTORY AND LEGAL COMPLIANCE NOTICE

THIS OPERATING AGREEMENT GOVERNS THE INTERNAL AFFAIRS, FINANCES, AND MANAGEMENT OF A LIMITED LIABILITY COMPANY ORGANIZED UNDER THE TENNESSEE REVISED LIMITED LIABILITY COMPANY ACT (TENN. CODE ANN. § 48-249-101 ET SEQ.). THIS DOCUMENT CONSTITUTES A LEGALLY BINDING CONTRACT AMONG THE MEMBERS AND MANAGERS. THE UNITS OR MEMBERSHIP INTERESTS CREATED AND REPRESENTED HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, THE TENNESSEE SECURITIES ACT OF 1980 (TENN. CODE ANN. § 48-1-101 ET SEQ.), OR APPLICABLE BLUE SKY LAWS OF ANY OTHER STATE. ACCORDINGLY, SUCH INTERESTS MAY NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT OR AN OPINION OF LEGAL COUNSEL SATISFACTORY TO THE COMPANY CONFIRMING EXEMPTION FROM REGISTRATION.

---

PARTIES AND RECITALS

This Operating Agreement (the "Agreement") of [Company Full Legal Name], LLC (the "Company") is entered into and made effective as of [Effective Date] (the "Effective Date"), by and among:

1. [Member One Full Legal Name], an individual residing at / an entity organized under the laws of [Jurisdiction] with its principal address at [Principal Address] ("Member One");
2. [Member Two Full Legal Name], an individual residing at / an entity organized under the laws of [Jurisdiction] with its principal address at [Principal Address] ("Member Two"); and
3. Any other Person who subsequently becomes a member of the Company in accordance with the terms and provisions of this Agreement (collectively with Member One and Member Two, the "Members," and individually, a "Member"); and
4. [Manager Full Legal Name], with an address at [Principal Address] (the initial "Manager"), and any successor Managers appointed pursuant hereto.

RECITALS:

WHEREAS, Articles of Organization (the "Articles") for the Company were properly executed and filed with the Division of Business Services of the Secretary of State of the State of Tennessee on [Filing Date], under Control Number [Tennessee SOS Control Number], in compliance with the Tennessee Revised Limited Liability Company Act (Tenn. Code Ann. § 48-249-101 et seq.);

WHEREAS, the Members desire to establish their respective rights, duties, liabilities, economic interests, and governance authorities regarding the Company, and to provide for the capital structure, operation, taxation, and orderly management of the Company pursuant to the terms herein;

NOW, THEREFORE, in consideration of the mutual covenants, premises, and agreements contained herein, and for other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, the Members and the Manager agree as follows:

---

SECTION 1: FORMATION, ORGANIZATION, AND STATUTORY COMPLIANCE

1.1 Formation. The Company was formed as a Tennessee limited liability company by the filing of Articles of Organization with the Secretary of State of the State of Tennessee on [Filing Date], pursuant to Tenn. Code Ann. § 48-249-201. The rights and liabilities of the Members and Managers shall be determined as provided in the Tennessee Revised Limited Liability Company Act (as amended from time to time, the "Act"), except as otherwise expressly modified or provided in this Agreement.

1.2 Company Name. The official name of the Company is [Company Full Legal Name], LLC. The business of the Company may be conducted under that name or, upon compliance with applicable Tennessee law and filing of assumed name registrations, under any other trade name selected by the Manager.

1.3 Principal Office and Place of Business. The principal executive office and place of business of the Company shall be located at [Principal Address], or at such other location within or outside the State of Tennessee as the Manager may designate from time to time with prompt written notice to the Members.

1.4 Registered Agent and Registered Office. The Company’s initial registered agent for service of process in the State of Tennessee and the initial registered office address shall be:

• Registered Agent: [Registered Agent Name]
• Registered Office: [Tennessee Street Address (No P.O. Box)], County of [County Name], State of Tennessee, [Zip Code]. The Manager may change the registered agent or registered office at any time by filing the appropriate statutory statement with the Tennessee Secretary of State pursuant to Tenn. Code Ann. § 48-249-109.

1.5 Term. The term of the Company commenced on the date the Articles of Organization were filed with the Secretary of State of Tennessee and shall continue perpetually unless the Company is dissolved and its affairs wound up in accordance with the provisions of this Agreement and Tenn. Code Ann. § 48-249-601 et seq.

1.6 Business Purpose and Authorized Powers. The exclusive purpose of the Company is to engage in [Specific Description of Business Purpose, e.g., commercial real estate acquisition, software development, medical equipment management] and to conduct any and all lawful business, activities, or ventures for which limited liability companies may be organized under the Act. The Company shall possess all powers necessary, convenient, or incidental to the accomplishment of this purpose, including those granted under Tenn. Code Ann. § 48-249-105.

1.7 Classification for Tax Purposes. The Members intend that the Company be classified and treated as a partnership for federal and state income tax purposes under United States Treasury Regulation § 301.7701-3, and not as an association taxable as a corporation. The Manager and the Members shall refrain from taking any tax filing position or election inconsistent with this partnership classification unless authorized by a Supermajority Vote of the Members.

---

SECTION 2: CAPITALIZATION, CONTRIBUTIONS, AND CAPITAL ACCOUNTS

2.1 Initial Capital Contributions. Contemporaneously with the execution of this Agreement, each Member has contributed to the capital of the Company the cash or property set forth opposite such Member’s name on Schedule A attached hereto. The aggregate initial value of each Member's contribution is explicitly defined as follows:

• Member One: [Amount in USD, e.g., $50,000.00] representing [Percentage, e.g., 50%] of the Membership Units.
• Member Two: [Amount in USD, e.g., $50,000.00] representing [Percentage, e.g., 50%] of the Membership Units.

2.2 Units of Membership Interest. The proportional equity interests of the Members in the Company shall be designated in "Units." The total authorized units of the Company shall be [Total Authorized Units, e.g., 100,000] Units. Schedule A shall accurately reflect the number of Units owned by each Member and the corresponding Percentage Interest.

2.3 Additional Capital Contributions. No Member shall be required or obligated to make any additional capital contributions to the Company beyond the initial contributions set forth in Schedule A, unless explicitly approved by a Supermajority Vote (as defined herein) of the Members. If the Manager determines that additional capital is required to protect, preserve, or expand Company operations, the Manager shall issue a written capital call notice ("Capital Call Notice") to all Members setting forth the total capital needed, the business justification, and each Member's pro-rata share based on current Percentage Interests. Each Member shall have thirty (30) calendar days from delivery of the Capital Call Notice to contribute their respective allocation.

2.4 Failure to Contribute; Dilution. If any Member fails to fund its pro-rata portion of an approved capital call within the thirty (30) day period (a "Defaulting Member"), the other Members who have fully satisfied their allocations ("Non-Defaulting Members") may, within fifteen (15) business days thereafter, elect to contribute the shortfall amount on a pro-rata basis among themselves. Upon the contribution of such shortfall, the Percentage Interests and Units of all Members shall be adjusted automatically to reflect the revised relative cumulative capital contributions of the Members. Alternatively, the Non-Defaulting Members may treat the unpaid balance as a recourse demand loan to the Defaulting Member bearing interest at twelve percent (12%) per annum or the maximum rate permitted under Tennessee law, repayable exclusively from distributions otherwise due to the Defaulting Member.

2.5 Maintenance of Capital Accounts. A separate capital account ("Capital Account") shall be established and maintained for each Member in full compliance with Section 704(b) of the Internal Revenue Code of 1986, as amended (the "Code"), and the Treasury Regulations promulgated thereunder (specifically Treas. Reg. § 1.704-1(b)(2)(iv)). Each Member's Capital Account shall be:

• (a) Increased by: (i) the amount of money contributed by such Member; (ii) the fair market value of property contributed by such Member (net of liabilities secured by such property that the Company assumes or takes subject to); and (iii) allocations to such Member of Company net profits and gain; and
• (b) Decreased by: (i) the amount of money distributed to such Member; (ii) the fair market value of property distributed to such Member (net of liabilities secured by such property that the Member assumes or takes subject to); and (iii) allocations to such Member of Company net losses, expenses, and deductions.

2.6 Negative Capital Accounts; No Interest on Capital. No Member shall be required to pay or restore to the Company any negative balance in such Member’s Capital Account upon liquidation or dissolution. No Member shall be entitled to receive any interest on its Capital Contribution or Capital Account balance, nor shall any Member have the right to withdraw any portion of its Capital Account or demand a return of its Capital Contribution except as explicitly provided in this Agreement.

---

SECTION 3: ALLOCATIONS OF PROFITS, LOSSES, AND TAX MATTERS

3.1 Allocation of Net Profits and Net Losses. After giving effect to the special and regulatory allocations set forth in Section 3.2, Net Profits and Net Losses of the Company for each fiscal year (or portion thereof) shall be allocated among the Members in proportion to their respective Percentage Interests as set forth on Schedule A.

3.2 Regulatory Allocations. This Agreement incorporates by reference the "qualified income offset" provisions of Treas. Reg. § 1.704-1(b)(2)(ii)(d), the "minimum gain chargeback" provisions of Treas. Reg. § 1.704-2(f), and the "partner minimum gain chargeback" provisions of Treas. Reg. § 1.704-2(i)(4). Nonrecourse deductions and partner nonrecourse deductions, as defined in Treas. Reg. § 1.704-2, shall be allocated strictly in compliance with applicable Treasury Regulations.

3.3 Section 704(c) Allocations. In accordance with Code Section 704(c) and the Treasury Regulations thereunder, income, gain, loss, and deduction with respect to any property contributed to the capital of the Company shall, solely for tax purposes, be allocated among the Members so as to take into account any variation between the adjusted basis of such property to the Company for federal income tax purposes and its initial fair market value at the time of contribution.

3.4 Partnership Representative. The Members hereby designate [Designated Individual / Member Name] as the "Partnership Representative" of the Company pursuant to Code Section 6223 (as amended by the Bipartisan Budget Act of 2015). The Partnership Representative shall have the exclusive authority to initiate, defend, conduct, and settle all federal income tax administrative and judicial proceedings on behalf of the Company. The Partnership Representative shall keep all Members fully informed of any ongoing audits, examinations, or disputes with the Internal Revenue Service and shall not agree to any settlement, extension of limitations, or push-out election under Code Section 6226 without the prior written consent of the Manager.

3.5 Tennessee State Tax Compliance. The Manager shall cause the Company to file all requisite tax returns, specifically including the Tennessee Franchise and Excise Tax Return (Form FAE 170) pursuant to Tenn. Code Ann. Title 67, Chapter 4, Parts 20 and 21, and to pay any and all entity-level taxes assessed by the Tennessee Department of Revenue. All excise and franchise taxes paid by the Company shall be treated as an operating expense of the Company and taken into account in computing net distributions.

---

SECTION 4: DISTRIBUTIONS

4.1 Operating Distributions. Except as otherwise restricted by Section 4.4 or applicable provisions of the Act, the Manager shall determine the amount of "Distributable Cash" available to the Company at least quarterly. Distributable Cash shall consist of all cash receipts of the Company arising from ordinary operations, less: (i) operating expenses; (ii) debt service payments; and (iii) reasonable reserves established by the Manager for working capital, contingent liabilities, and future operational obligations. Distributable Cash shall be distributed to the Members pro-rata in accordance with their Percentage Interests.

4.2 Tax Distributions. Prior to making general distributions under Section 4.1, the Company shall distribute to each Member, within seventy-five (75) days following the end of each fiscal year (and quarterly on an estimated basis), an amount of cash ("Tax Distribution") sufficient to enable each Member to pay its anticipated federal, state, and local income tax liabilities resulting from the taxable income of the Company allocated to such Member. The Tax Distribution shall be calculated by multiplying the net taxable income allocated to a Member by an assumed combined tax rate equal to the highest marginal federal, state, and local income tax rate applicable to an individual or corporate resident in Tennessee, whichever is higher. Any Tax Distribution made to a Member shall be treated as an advance against, and shall reduce dollar-for-dollar, subsequent distributions to which such Member is entitled under Section 4.1.

4.3 Liquidating Distributions. Proceeds from a Liquidation Event (as defined herein) shall be distributed strictly in accordance with Section 8.3 of this Agreement and Section 704(b) of the Code.

4.4 Statutory Limitation on Distributions. Notwithstanding any provision to the contrary contained in this Agreement, the Company shall make no distribution to any Member if, after giving effect to the distribution, the Company would be in violation of Tenn. Code Ann. § 48-249-306, such that:

• (a) The Company would not be able to pay its debts as they become due in the ordinary course of business; or
• (b) The Company's total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the Company were to be dissolved at the time of distribution, to satisfy the preferential rights upon dissolution of Members whose preferential rights are superior to those receiving the distribution. Any Member who receives a distribution in violation of Tenn. Code Ann. § 48-249-306 shall be personally liable to the Company for the amount of the distribution wrongfully received to the extent mandated by Tenn. Code Ann. § 48-249-307.

---

SECTION 5: MANAGEMENT, GOVERNANCE, AND VOTING

5.1 Management Structure. Pursuant to Tenn. Code Ann. § 48-249-401, the Company shall be Manager-Managed. The operational management, business policies, and general affairs of the Company shall be fully vested in the Manager, subject only to those specific matters expressly reserved to the vote or consent of the Members under this Agreement or mandatory provisions of the Act.

5.2 Appointment and Tenure of Manager. The initial Manager shall be [Manager Full Legal Name]. The Manager shall hold office until resignation, death, incapacity, or removal in accordance with this Section. A Manager may be removed at any time, with or without cause, exclusively upon the affirmative vote of Members holding at least seventy-five percent (75%) of the outstanding Units ("Supermajority Vote"). Upon the removal, resignation, death, or incapacity of the Manager, a successor Manager shall be elected by a Majority Vote of the Members.

5.3 Authority of the Manager. Except as restricted by Section 5.4, the Manager shall have full, active, and unilateral power and authority to act on behalf of the Company, including the power to:

• (a) Transact day-to-day operational business, manage contracts, and procure inventory and services;
• (b) Open, maintain, and close bank accounts and draw checks thereon;
• (c) Hire, supervise, compensate, discipline, and terminate employees, independent contractors, attorneys, accountants, and agents;
• (d) Enter into, execute, and deliver commercial agreements, contracts, licenses, and leases binding the Company, where the total financial obligation does not exceed [Dollar Amount, e.g., $100,000.00];
• (e) Procure insurance policies protecting the Company’s operations, physical assets, Members, and Managers.

5.4 Major Decisions Requiring Member Approval. Notwithstanding the general authority vested in the Manager, the Manager shall NOT undertake, authorize, or execute any of the following matters (each, a "Major Decision") without the prior written consent or affirmative vote of Members holding at least sixty-six and two-thirds percent (66.67%) of the outstanding Units (a "Supermajority Vote"):

• (a) The sale, lease, exchange, mortgage, pledge, or other disposition of all or substantially all of the assets of the Company outside the ordinary course of business;
• (b) Any merger, consolidation, conversion, statutory share exchange, or business combination involving the Company;
• (c) The incurrence of any indebtedness, extension of credit, or execution of loan documents in an aggregate principal amount exceeding [Dollar Amount, e.g., $100,000.00];
• (d) The confession of a judgment against the Company or the settlement of any claim, suit, or legal proceeding where the settlement liability to the Company exceeds [Dollar Amount, e.g., $50,000.00];
• (e) The issuance of additional Membership Units or the admission of any new Member to the Company;
• (f) Making an assignment for the benefit of creditors, filing a petition in bankruptcy, or initiating insolvency proceedings under federal or state law;
• (g) The voluntary dissolution, liquidation, or winding up of the Company; or
• (h) Any amendment or restatement of the Articles of Organization or this Operating Agreement.

5.5 Fiduciary Duties and Standard of Conduct. In accordance with Tenn. Code Ann. § 48-249-403, the Manager shall discharge all duties as a manager in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner the Manager reasonably believes to be in the best interests of the Company. A Manager does not violate a duty or obligation under this Agreement or under the Act merely because the Manager's conduct furthers the Manager's own interest, provided such conduct does not constitute gross negligence, intentional misconduct, knowing violation of law, or a material breach of this Agreement.

5.6 Member Voting and Action Without a Meeting. When Member approval is required under this Agreement, each Member shall be entitled to vote in proportion to their Percentage Interest. Members may vote in person, by proxy, or by written consent. Any action required or permitted to be taken at a meeting of the Members may be taken without a meeting if a consent in writing, setting forth the action so taken, is signed by the Members holding the requisite voting percentage necessary to authorize such action at a duly convened meeting where all Members were present and voting.

---

SECTION 6: RIGHTS, DUTIES, AND RESTRICTIONS OF MEMBERS

6.1 Limited Liability. Pursuant to Tenn. Code Ann. § 48-249-114, no Member or Manager of the Company shall be personally obligated, bound, or liable for any debt, obligation, or liability of the Company, whether arising in contract, tort, or otherwise, solely by reason of being a Member or Manager of the Company. The failure of the Company to observe any formalities relating to the exercise of its powers or the management of its business shall not be a ground for imposing personal liability on any Member or Manager for the liabilities of the Company.

6.2 Access to Books and Records. In accordance with Tenn. Code Ann. § 48-249-408, each Member has the right, upon reasonable written request delivered to the Manager at least five (5) business days in advance and for a purpose reasonably related to such Member's interest as a member, to inspect and copy, at the requesting Member's expense, during ordinary business hours, the true and full records of the Company, including:

• (a) A current list of the full name and last known address of each Member and Manager;
• (b) A copy of the Articles of Organization and all amendments thereto;
• (c) Copies of this Agreement and any written amendments;
• (d) Copies of the Company's federal, state, and local income tax returns and reports for the three (3) most recent fiscal years;
• (e) Financial statements of the Company for the three (3) most recent fiscal years.

6.3 Confidentiality. Each Member acknowledges that in connection with its investment in the Company, such Member will have access to confidential, proprietary, and trade secret information concerning the business, operations, technical architecture, finances, customer lists, and strategic plans of the Company (collectively, "Confidential Information"). Each Member agrees that it shall maintain the strict confidentiality of all Confidential Information, shall exercise the same degree of care to avoid disclosure as it uses to protect its own highly sensitive data (but not less than a reasonable standard of care), and shall not disclose, publish, or use any Confidential Information for any purpose outside the scope of this Agreement without the prior written approval of the Manager; provided, however, that a Member may disclose Confidential Information to its professional legal and financial advisors who are bound by professional duties of confidentiality, or pursuant to a valid judicial subpoena or regulatory inquiry, provided prompt written notice is furnished to the Company to enable it to seek a protective order.

6.4 Restrictive Covenants and Outside Activities.

• (a) Outside Business: Except as explicitly set forth in subsection (b), each Member and Manager may engage in or possess an interest in other business ventures of every nature and description, independently or with others, even if such ventures are in competition with the Company, and neither the Company nor the other Members shall have any rights by virtue of this Agreement in or to such independent ventures or the income or profits derived therefrom.
• (b) Non-Solicitation: During the period in which a Member holds Units in the Company and for a period of twenty-four (24) months following the disposition of all Units by such Member, such Member shall not, directly or indirectly: (i) solicit, recruit, induce, or attempt to induce any employee, executive, or independent contractor of the Company to terminate their employment or contractual relationship with the Company; or (ii) solicit, induce, or divert any customer, client, or active account of the Company to patronize any competitive business enterprise.

---

SECTION 7: TRANSFER OF MEMBERSHIP INTERESTS AND BUY-SELL PROVISIONS

7.1 Absolute Restriction on Transfers. No Member shall sell, assign, pledge, hypothecate, encumber, bequeath, donate, transfer, or otherwise dispose of (each, a "Transfer") all or any portion of its Units or economic interest in the Company, whether voluntarily, involuntarily, by operation of law, or otherwise, except in strict compliance with the explicit terms of this Section 7. Any attempted Transfer made in violation of this Section shall be null, void ab initio, and of no legal force or effect, and the Company shall refuse to recognize the putative transferee as a Member or economic interest holder for any purpose.

7.2 Permitted Transfers. Notwithstanding the general restriction in Section 7.1, a Member who is an individual may Transfer all or a portion of its Units without the consent of the other Members or the Manager to: (i) the Member's spouse, children, or direct descendants; (ii) a trust created solely for the benefit of such Member or such Member's immediate family; or (iii) an entity wholly owned and controlled by such Member (each, a "Permitted Transferee"); provided, that such Permitted Transferee shall take such Units subject to all provisions of this Agreement, shall execute a joinder agreement agreeing to be bound by all obligations hereunder, and shall hold the Units purely as an economic interest holder without voting or management participation rights unless admitted as a substitute Member pursuant to Section 7.5.

7.3 Right of First Refusal (ROFR).

• (a) Third-Party Notice: If a Member (the "Selling Member") receives a bona fide, written, arms-length cash offer from an unaffiliated third party (a "Third-Party Offer") to purchase all or any portion of its Units, which offer the Selling Member desires to accept, the Selling Member shall promptly deliver written notice (the "Transfer Notice") to the Company and the other Members. The Transfer Notice must include: (i) a copy of the Third-Party Offer; (ii) the number of Units proposed to be transferred; (iii) the proposed cash purchase price per Unit; (iv) the identity of the prospective purchaser; and (v) the proposed closing date.
• (b) Company Option: For a period of thirty (30) days following receipt of the Transfer Notice, the Company shall possess the primary option to purchase all or any portion of the offered Units at the price and upon the terms set forth in the Transfer Notice.
• (c) Secondary Member Option: If the Company declines to exercise its option or exercises it with respect to less than all of the offered Units within said thirty (30) day period, the non-selling Members shall have an additional option for a period of fifteen (15) days to purchase the remaining offered Units pro-rata based on their Percentage Interests (excluding the Selling Member), or in such other proportions as they may mutually agree.
• (d) Sale to Third Party: If the Company and the non-selling Members fail to exercise their options to acquire all of the offered Units, the Selling Member may, within sixty (60) days after the expiration of the second option period, transfer all (but not less than all) of the offered Units to the third-party purchaser identified in the Transfer Notice at the identical price and on identical terms. If the sale does not close within said sixty (60) day period, the offered Units shall again become subject to the restrictions and options set forth in this Section 7.3.

7.4 Drag-Along and Tag-Along Rights.

• (a) Drag-Along Right: If Members holding at least seventy-five percent (75%) of the outstanding Units (the "Dragging Members") approve a bona fide sale of all or substantially all of the Company's equity or assets to an unaffiliated third party (whether structured as a merger, equity sale, consolidation, or asset transaction), the Dragging Members shall have the right to compel the remaining Members to participate in the transaction and sell all of their Units on the identical terms, conditions, and per-Unit price as accepted by the Dragging Members.
• (b) Tag-Along Right: If one or more Members propose to sell Units representing more than fifty percent (50%) of the outstanding Units to an unaffiliated third party, and neither the Company nor the other Members exercise their Right of First Refusal, the remaining non-selling Members shall have the right to participate in such sale on the identical economic terms and conditions, pro-rata based on their relative Unit holdings.

7.5 Admission of Transferees as Substitute Members. No transferee of Units (including a Permitted Transferee or a third-party purchaser under Section 7.3) shall become a Member of the Company unless and until all of the following conditions are satisfied:

• (a) The Manager and Members holding a majority of the remaining outstanding Units approve the admission of the transferee as a substitute Member;
• (b) The transferee executes and delivers a written counterpart signature page or joinder agreement agreeing to be bound by all terms, restrictions, and covenants of this Operating Agreement;
• (c) The transferee pays all reasonable legal, accounting, and documentation expenses incurred by the Company in connection with its admission. If a transferee is not admitted as a substitute Member, such transferee shall be entitled only to receive the economic allocations and distributions to which the transferring Member would have been entitled, and shall have no right to vote, participate in management, inspect books and records, or exercise any statutory rights of a Member under the Act.

7.6 Involuntary Transfer and Disassociation Events.

• (a) Events of Disassociation: A Member shall cease to be a Member of the Company upon the occurrence of any event described in Tenn. Code Ann. § 48-249-501, including: (i) the death or judicial determination of incapacity of an individual Member; (ii) the filing of a voluntary or involuntary petition in bankruptcy by or against a Member; (iii) the dissolution, termination, or administrative revocation of an entity Member; or (iv) the charging order or attachment of a Member's Units by a judgment creditor (each, a "Disassociation Event").
• (b) Mandatory Purchase Option: Upon the occurrence of a Disassociation Event, the disassociated Member (or such Member's legal representative, trustee, or estate) shall immediately lose all voting and managerial rights. The Company shall have the exclusive option, exercisable within ninety (90) days from receiving notice of the Disassociation Event, to purchase all of the Units owned by the disassociated Member at a purchase price equal to the "Fair Market Value" determined pursuant to Section 7.7. If the Company does not exercise this option, the remaining Members shall have a secondary option for thirty (30) days to acquire the Units pro-rata.

7.7 Valuation of Units. For purposes of Section 7.6, the "Fair Market Value" of a Member’s Units shall be determined by mutual agreement between the Manager and the disassociated Member (or its personal representative). If the parties are unable to reach agreement within thirty (30) days, the Company and the disassociated Member shall jointly select a qualified, independent certified public accountant or business appraiser credentialed by the American Society of Appraisers (ASA) or the AICPA. If the parties cannot agree on a single appraiser, each shall select one appraiser, and the two appraisers shall select a third independent appraiser. The determination of the third appraiser as to the Fair Market Value of the Company and the subject Units (applying standard valuation metrics without discounts for minority interest or lack of marketability) shall be final, binding, and non-appealable. The costs of the appraisal shall be split equally between the Company and the disassociated Member. The purchase price shall be paid, at the Company's election, either in a single lump-sum cash closing within sixty (60) days of the appraisal, or in thirty-six (36) equal monthly principal and interest payments bearing interest at the Prime Rate published in the Wall Street Journal on the date of closing.

---

SECTION 8: DISSOLUTION, LIQUIDATION, AND TERMINATION

8.1 Dissolution Events. The Company shall be dissolved, and its business and affairs wound up, exclusively upon the occurrence of any of the following events (each, a "Dissolution Event"):

• (a) The affirmative Supermajority Vote of the Members directing that the Company be dissolved;
• (b) The sale, transfer, or liquidation of all or substantially all of the assets of the Company and the collection and distribution of the net proceeds therefrom;
• (c) The entry of a decree of judicial dissolution pursuant to Tenn. Code Ann. § 48-249-617; or
• (d) Administrative dissolution by the Tennessee Secretary of State pursuant to Tenn. Code Ann. § 48-249-604, subject to timely reinstatement under Tenn. Code Ann. § 48-249-606.

8.2 Winding Up and Liquidation Procedure. Upon the occurrence of a Dissolution Event, the Manager (or if there is no remaining Manager, a liquidating trustee appointed by a Majority Vote of the Members) shall act as the liquidator. The liquidator shall proceed diligently to wind up the affairs of the Company, liquidate its physical and intangible assets, pay or establish reasonable reserves for all Company liabilities, and cancel the Articles of Organization in compliance with Tenn. Code Ann. § 48-249-601 et seq.

8.3 Priority of Payment on Liquidation. The gross proceeds realized from the liquidation of the Company’s property and assets shall be applied, disbursed, and distributed in the following strict order of priority:

• (a) Creditors: First, to the payment of all valid debts, liabilities, and obligations of the Company owed to third-party creditors and to Members who are creditors (other than liabilities for past distributions), and the expenses of liquidation, winding up, and legal compliance;
• (b) Reserves: Second, to the establishment of any contingency reserves deemed reasonably necessary by the liquidator to satisfy unmatured, contingent, or conditional liabilities or obligations of the Company;
• (c) Capital Accounts: Third, to the Members pro-rata in accordance with their positive Capital Account balances, determined after giving effect to all contributions, distributions, and allocations of profit, loss, and gain for all periods up to and including the date of liquidation; and
• (d) Pro-Rata Distribution: Finally, any remaining assets and cash shall be distributed to the Members pro-rata in accordance with their Percentage Interests.

8.4 Filing of Articles of Termination. Upon completion of the liquidation, settlement of debts, and distribution of remaining assets as provided in this Section 8, the liquidator shall promptly execute, deliver, and file Articles of Termination with the Secretary of State of Tennessee pursuant to Tenn. Code Ann. § 48-249-608, thereby effecting the formal legal cancellation of the Company.

---

SECTION 9: EXCULPATION AND INDEMNIFICATION

9.1 Exculpation of Covered Persons. To the maximum extent permitted under the Tennessee Revised Limited Liability Company Act (specifically Tenn. Code Ann. § 48-249-115), no Member, Manager, officer, employee, or agent of the Company (each, a "Covered Person") shall be personally liable to the Company or to any Member for monetary damages resulting from any breach of duty, act, or omission committed in their capacity as a Covered Person, EXCEPT for liability resulting from:

• (a) Breach of the duty of loyalty to the Company or its Members under Tenn. Code Ann. § 48-249-403;
• (b) Acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;
• (c) Unlawful distributions under Tenn. Code Ann. § 48-249-307; or
• (d) Any transaction from which the Covered Person derived an improper personal benefit.

9.2 Mandatory Indemnification. The Company shall indemnify, defend, and hold harmless every Covered Person who was or is a party, or is threatened to be made a party, to any threatened, pending, or completed action, suit, proceeding, or investigation, whether civil, criminal, administrative, or investigative (including an action by or in the right of the Company), by reason of the fact that such person is or was a Manager, Member, officer, employee, or agent of the Company, against all expenses (including reasonable attorneys' fees), judgments, fines, penalties, and settlement amounts actually and reasonably incurred by such Covered Person in connection with such action, suit, or proceeding; provided, that such Covered Person acted in good faith and in a manner reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal proceeding, had no reasonable cause to believe their conduct was unlawful.

9.3 Advancement of Legal Expenses. Expenses (including reasonable attorneys’ fees and expert costs) incurred by a Covered Person in defending any civil, criminal, administrative, or investigative action, suit, or proceeding shall be advanced and paid by the Company as they are incurred, in advance of the final disposition of such matter; provided, that the Covered Person delivers to the Company an unconditional, written undertaking to repay all amounts advanced if it is ultimately determined by a final, non-appealable judicial decree that the Covered Person is not entitled to be indemnified by the Company under this Section 9 or applicable Tennessee law.

9.4 Insurance. The Manager is authorized to cause the Company to purchase and maintain Directors and Officers (D&O) liability insurance on behalf of any Covered Person against any liability asserted against or incurred by such person in any such capacity, whether or not the Company would possess the statutory power to indemnify such person against such liability under the Act.

---

SECTION 10: DISPUTE RESOLUTION AND MANDATORY ARBITRATION

10.1 Direct Negotiations. In the event of any dispute, claim, breach, or controversy arising out of, relating to, or in connection with this Operating Agreement, the Articles of Organization, or the management or affairs of the Company (a "Dispute"), the aggrieved party shall deliver written notice of the Dispute to the other parties. The Members and Manager agree to engage in direct, good-faith negotiations for a minimum period of thirty (30) calendar days from receipt of such notice in an effort to amicably resolve the Dispute without formal proceedings.

10.2 Mandatory Binding Arbitration. If the Dispute is not fully settled within thirty (30) days of direct negotiation, the Dispute shall be submitted to and finally resolved by mandatory, binding commercial arbitration administered by the American Arbitration Association ("AAA") under its Commercial Arbitration Rules then in effect, subject to the following modifications:

• (a) Venue: The seat, legal place, and physical venue of arbitration shall be in [City, e.g., Nashville / Memphis / Knoxville], Tennessee.
• (b) Tribunal: The arbitration tribunal shall consist of a single neutral arbitrator mutually selected by the parties; provided, that if the parties fail to agree on an arbitrator within twenty (20) days of the demand for arbitration, the AAA shall appoint a single neutral arbitrator who is a licensed Tennessee attorney having not less than fifteen (15) years of commercial corporate litigation and entity governance experience.
• (c) Discovery: Discovery shall be limited to the exchange of directly relevant documents and not more than two (2) depositions per party, unless the arbitrator determines that further discovery is indispensable to prevent manifest injustice.
• (d) Authority: The arbitrator shall have the authority to grant legal, equitable, injunctive, and declaratory relief. The arbitrator shall NOT have authority to award punitive, exemplary, or speculative damages.
• (e) Finality: The written award rendered by the arbitrator shall be final, non-appealable, and binding on all parties. Judgment on the award may be entered and enforced in any court of competent jurisdiction located within the State of Tennessee or elsewhere.

10.3 Prevailing Party Fees. In any arbitration or judicial proceeding arising under this Agreement, the prevailing party shall be entitled to recover from the non-prevailing party all reasonable attorneys' fees, expert witness fees, administrative arbitration expenses, and court costs incurred in prosecuting or defending the action.

10.4 WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED UNDER TENNESSEE LAW, EACH MEMBER AND THE MANAGER HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING, LITIGATION, CONTROVERSY, OR ACTION ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE COMPANY'S BUSINESS, OR THE TRANSACTIONS CONTEMPLATED HEREBY.

---

SECTION 11: GENERAL AND MISCELLANEOUS PROVISIONS

11.1 Governing Law. This Agreement, the internal affairs of the Company, and all claims or causes of action (whether in contract, tort, or statutory) arising out of or related to this Agreement shall be governed by, construed under, and enforced in accordance with the internal laws of the State of Tennessee, including the Tennessee Revised Limited Liability Company Act, without giving effect to any choice of law or conflict of law principle that would result in the application of the laws of any other jurisdiction.

11.2 Amendments. This Agreement may be modified, altered, amended, or restated only through an explicit written instrument executed by Members holding at least a Supermajority Vote; provided, however, that any amendment that materially and disproportionately reduces an individual Member's economic distribution rights, increases such Member's personal liability, or obligates a Member to contribute additional capital shall require the unanimous written consent of all affected Members.

11.3 Notices. All notices, demands, consents, approvals, requests, or other communications required or permitted under this Agreement shall be in writing and shall be deemed properly delivered:

• (a) Upon personal hand-delivery;
• (b) One (1) business day after deposit with a nationally recognized overnight courier (e.g., FedEx, UPS) with tracking requested;
• (c) Three (3) business days after deposit in the United States Mail, registered or certified mail, return receipt requested, postage prepaid; or
• (d) Upon receipt of electronic mail delivery confirmation (provided that notice is sent during normal business hours and an additional copy is sent by first-class mail). All communications shall be addressed to the parties at their respective addresses set forth on Schedule A or to such other address as any party may designate by advance written notice.

11.4 Severability. If any provision of this Agreement or the application thereof to any person or circumstance is held to be invalid, illegal, or unenforceable by an arbitrator or court of competent jurisdiction, such invalidity shall not affect the remaining provisions of this Agreement. To this end, the provisions of this Agreement are declared severable, and the invalid provision shall be reformed to the minimum extent necessary to render it valid and enforceable while giving effect to the original commercial intent.

11.5 Entire Agreement. This Operating Agreement, together with the Articles of Organization and the Schedules attached hereto, constitutes the complete, final, and exclusive expression of the agreement among the Members and Manager regarding the subject matter hereof, and supersedes all prior agreements, term sheets, understandings, representations, and negotiations, whether oral or written.

11.6 Counterparts and Electronic Signature. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same legal instrument. Counterpart execution may be evidenced by signatures delivered via facsimile, portable document format (.pdf), DocuSign, Adobe Sign, or any electronic signature complying with the Tennessee Uniform Electronic Transactions Act (Tenn. Code Ann. § 47-10-101 et seq.) and the federal E-SIGN Act.

11.7 Binding Effect. Subject to the restrictions on Transfer contained herein, this Agreement shall be binding upon and inure to the benefit of the Members, the Manager, and their respective heirs, legal representatives, executors, administrators, successors, and permitted assigns.

---

EXECUTION AND FORMAL SIGNATURE BLOCKS

IN WITNESS WHEREOF, the undersigned Members and Manager have formally approved, executed, adopted, and delivered this Amended and Restated Operating Agreement of [Company Full Legal Name], LLC, to be legally binding and effective as of the Effective Date set forth above.

FOR [COMPANY FULL LEGAL NAME], LLC: Signature: _____________________________________
Printed Name: [Authorized Signatory Name]
Title: [Manager / Chief Executive Officer]
Company: [Company Legal Name]
Date: [Date]

FOR [MEMBER ONE FULL LEGAL NAME]: Signature: _____________________________________
Printed Name: [Authorized Signatory Name]
Title: [Member / Authorized Representative]
Company: [Entity Name, if applicable]
Date: [Date]

FOR [MEMBER TWO FULL LEGAL NAME]: Signature: _____________________________________
Printed Name: [Authorized Signatory Name]
Title: [Member / Authorized Representative]
Company: [Entity Name, if applicable]
Date: [Date]

---

SCHEDULE A: SCHEDULE OF MEMBERS, CAPITAL CONTRIBUTIONS, AND UNITS

---

SCHEDULE B: INITIAL MANAGERS

Pursuant to Section 5.2 of this Agreement, the following individual(s) or entity is hereby designated and appointed as the initial Manager(s) of the Company:

1. Full Legal Name: [Manager Full Legal Name]
   • Physical Address: [Principal Address]
   • Contact Phone: [Phone Number]
   • Corporate Email: [Email Address]
   • Term: Perpetual until death, resignation, incapacity, or removal pursuant to Section 5.2.

---

STEP-BY-STEP EXECUTION AND FILING GUIDE

Follow this operational compliance guide to properly execute, format, and maintain this Operating Agreement under Tennessee corporate law:

1. Completing Bracketed Information

• Open this document in Microsoft Word or Google Docs.
• Use the Find and Replace utility (Ctrl + H or Cmd + H) to locate all bracketed placeholders (e.g., [Company Full Legal Name], [Principal Address], [Effective Date]).
• Replace all placeholders with exact, verified legal data matching your Tennessee corporate filings. Verify that the registered agent and office address precisely mirror the initial records filed on Form SS-4270 with the Tennessee Secretary of State.

2. Verification of Signatory Authority

• If any Member is a legal entity (Corporation, LLC, Trust, or Partnership), confirm that the executing individual possesses requisite signatory authority pursuant to a board resolution, power of attorney, or underlying entity operating agreement.
• Request and inspect an active Certificate of Existence from the home state for any entity Member to ensure it is in good legal standing.

3. Execution via Electronic Signature Platforms (DocuSign / Adobe Sign)

• If executing digitally, configure the electronic signature platform to use Cryptographic Digital Signatures that comply with the Tennessee Uniform Electronic Transactions Act (Tenn. Code Ann. § 47-10-101 et seq.) and the federal E-SIGN Act (15 U.S.C. § 7001).
• Ensure that the audit trail captures: (i) signer email addresses; (ii) timestamps (UTC); (iii) IP addresses; and (iv) certificate authentication hashes.
• Retain the resulting "Certificate of Completion" or "Audit Report" bound directly to the executed PDF copy.

4. Corporate Record Retention & Statutory Compliance

• Do NOT file this Operating Agreement with the Tennessee Secretary of State. Under Tennessee law, an operating agreement is an internal, non-public governance document.
• Retain the fully signed agreement along with the certified copy of the filed Articles of Organization at the Company’s principal office in accordance with Tenn. Code Ann. § 48-249-408.
• Provide an executed PDF duplicate to all Members and legal counsel.

5. Critical Tennessee State Tax & Filing Obligations

• Franchise and Excise Tax Registration: Within ninety (90) days of formation, ensure the Company registers with the Tennessee Department of Revenue via the TNTAP portal (Tennessee Taxpayer Access Point) to establish an account for Franchise and Excise (F&E) tax filing.
• Annual Reports: File the mandatory Annual Report and pay the statutory filing fee (minimum $300, based on $50 per member up to a maximum of $3,000 under Tenn. Code Ann. § 48-249-1007) with the Tennessee Secretary of State on or before the first day of the fourth month following the close of the Company’s fiscal year (typically April 1 for calendar-year entities). Failure to file will result in administrative dissolution under Tenn. Code Ann. § 48-249-604.