Clauses of Operating Agreement on basis of a Factual Scenario:

Case Facts:

Client being an Indian Private Limited Company, having 4 founding members (Akash Gupta, Laxmi Tiwari, Dolly Awasthi & Kunal Sharma) operating in the domain of Artificial intelligence have decided to expand in US by incorporating a LLC in Delaware.?

The Clauses of LLC Operating Agreement for a Multi Member managed Delaware LLC:

1. Purpose
2. Details of the 4 members and their roles
3. Capital contribution: You can state that the minimum contribution of each of the members is $10,000. (You can also mention higher contributions than $10,000)
4. Profit sharing: You can mention Profit Sharing according to the capital contributions
5. Membership interests / units - calculate based on capital contribution
6. Provisions dealing with powers of members and managers
7. Resignation and removal of members

?Statutory Reference:

Title – 6, Subtitle – II, Chapter – 18, Limited Liability Company Act, Delaware

Purpose:

The Company is created for following business purpose:

1.???? To setup and conduct the business of installing AI interface at toll collection booths on the highways and such other or incidental activities to facilitate efficient seamless toll collection.

Details of the four members and their roles:

Subject to Section 305, Subchapter – III, dealing with Members, Operating Member shall have exclusive responsibility and authority for the day-to-day management and operation of the business and affairs of the Company in accordance with the Approved Budget and the other terms and conditions of this Agreement. The Operating Member accepts and agrees to perform its duties and undertake its responsibilities set forth in this Agreement, to act in good faith and in the best interests of the Company, and to exercise all commercially reasonable efforts to cause the business of the Company to be operated and managed in a manner consistent with the management and operation of business. The Operating Member shall: (A) act as the Company's representative with respect to all aspects of the acquisition, development, ownership, and management of the Property and other assets of the Company ; (B) make all commercially reasonable efforts to comply with and perform all obligations of the Company and the Property Owner ; (C) execute and implement all major decisions that have been approved with respect to the Property and the Company and (D) act as the Company's representative in connection with any proposed sale or financing transaction, providing required financial information or other documentation, dealing with brokers, financiers and performing such additional duties as the investor member may reasonably request.

Capital contribution:

The member shall make an initial contribution to the Company, which is described as under:

• Akash Gupta – USD 10,000/-

?

• Laxmi Tiwari - USD 10,000/-

?

• Dolly Awasthi – USD 10,000/-

?

• Kunal Sharma - USD 10,000/-

?No member shall be entitled to interest on their initial contribution and shall have the right to demand return of their initial contribution, except as expressly provided in this agreement or as required by the law.

Profit sharing:

Subject to Section 503, Subchapter – V, dealing with Finance, the Profit & Loss of a Limited Liability Company shall be allocated amongst the members equally in accordance to the contribution made by each member, to the extent it has been received by LLC and has not been returned.

Membership interests:

Subject to Section 701, Subchapter – VII, dealing with Assignment of Limited Liability Company Interests, Members interest in the Company will be considered as personal property and will be determined in accordance to the Capital Contribution.

Provisions dealing with powers of members and managers:

Subject to Section 407, Subchapter – IV, dealing with Managers, a member or manager of a limited liability company has the power and authority to delegate to 1 or more other persons any or all of the member’s or manager’s, as the case may be, rights, powers and duties to manage and control the business and affairs of the limited liability company, which delegation may be made irrespective of whether the member or manager has a conflict of interest with respect to the matter as to which its rights, powers or duties are being delegated, and the person or persons to whom any such rights, powers or duties are being delegated shall not be deemed conflicted solely by reason of the conflict of interest of the member or manager. Any such delegation may be to agents, officers and employees of a member or manager or the limited liability company, and by a management agreement or another agreement. Such delegation by a member or manager shall be irrevocable if it states that it is irrevocable. Such delegation by a member or manager of a limited liability company shall not cause the member or manager to cease to be a member or manager, as the case may be, of the limited liability company or cause the person to whom any such rights, powers and duties have been delegated to be a member or manager, as the case may be, of the limited liability company. No other provision of this chapter or other law shall be construed to restrict a member’s or manager’s power and authority to delegate any or all of its rights, powers and duties to manage and control the business and affairs of the limited liability company.

Resignation and removal of members:

Subject to Section 603, Subchapter – VI, dealing with Distributions and Resignation, a member may resign from a limited liability company only at the time of or upon the happening of events as defined in the limited liability company agreement. Notwithstanding anything to the contrary under applicable law, a member may not resign from a limited liability company prior to the dissolution and winding up of the Company and if he does his interest in the Company may not be assigned.