OPERATING AGREEMENT

OF

HOOP STREET ENTERTAINMENT, L.L.C.

an Arizona limited liability company

This OPERATING AGREEMENT is made and entered into as of the __ day of ___,

2020, by and among the undersigned Members of Hoop Street Entertainment, LLC.,

an Arizona limited liability company (the “Company”).

Section I

Formation; Name and Office; Purpose

1.1. Formation. Pursuant to the Arizona Limited Liability Company Act, A.R.S.

Section 29-601 through 29-857 (the “Act”) the Members has formed an

Arizona limited liability company effective upon the filing of the Articles of

Organization of this Company (the “Articles”) with the Arizona Corporation

Commission. The Member has executed this Agreement to serve as the

“Operating Agreement” of the Company, as that term is defined in A.R.S.

Section 29-601(12), and, subject to any applicable restrictions set forth in this

Act, the business and affairs of the Company, and the relationship of the

Member to the Company, shall be operated in accordance with and governed

by the terms and conditions set forth in this Agreement.

1.2. Name and Registered Office. The Company shall be conducted under the

name of Hoop Street Entertainment, LLC., and the registered office of the

Company shall be at _____, or such other place as the Members may time to

time determine.

1.3. Purpose. The purpose and business of this Company shall be to engage in
the ____________ and such other activities as the Members shall determine

from time to time. The Company shall have the power to do any and all acts

and things necessary, appropriate, or incidental to the furtherance of such purpose.

Section II

Definitions

The following terms shall have the meaning set forth in this Section II:

2.1. “Act” means the Arizona Limited Liability Company Act, A.R.S. Section 291-

601 through 29-857, as amended from time to time (or any corresponding

provisions of succeeding law).

2.2. “Capital Contribution” means any contribution to the capital of the Company in

cash or property by a Member. “Initial Capital Contribution” shall mean the

initial contribution of any Member to the capital of the Company pursuant to

this Operating Agreement. “Additional Capital Contribution” shall include all

Capital Contributions to the Company not including any Person’s Initial Capital

Contribution.

2.3. “Class A Member” and “Class B Member” are defined in Section 2._, below.

2.4. “Class A Units” and “Class B Units” are defined in Section 2.__, below.

2.5. “Events of Withdrawal” means those events and circumstances listed in

Section 29-733 of the Act.

2.6. “Majority in Interest” means a Member who owns a simple majority of the

Percentage Interest held by members.

2.7. “Member” means the undersigned member and any Person who subsequently

is admitted as a Member of the Company until such time as an Event of

Withdrawal has occurred with respect to such Member. Initially there will be

two classes of Members.

The initial “Class A Members” are set forth on Exhibit “A”.

There shall be no initial “Class B Member.”

pursuant of Section IV of this Agreement.

2.9. “Percentage Interest” means, as to a Member, the percentage set forth after

the Member’s name of Exhibit A, as amended from time to time to reflect any

transfers permitted under this Agreement.

2.10. “Person” means and includes an individual, corporation, partnership,

association, limited liability company, tort, estate, or other entity.

2.11. “Units”’ includes measure by which each holder’s Percentage Economic Interest and Percentage
Membership Interest is determined.

(a) “Class A Units” means Units held by a Class A Member in his or her

capacity as a Class A Member and shall be entitled to Vote on matters

presented to the Members for approval;

(b) “Class B Units” mean Units held by a Class B Member in his or her

capacity as a Class B Member, and shall not be entitled to Vote unless the

right to Vote is expressly granted by the Managers.

Section III

Capital Contribution and Distributions

Capital Contributions.

3.1.1. Each Member has made an Initial Capital as follows, and received Units,

which Units are reflected on Exhibit A attached hereto.

3.1.2. Persons to whom the Managers determine to issue additional Units in the

future will make Initial Capital Contributions as the Managers may require.

3.1.3. Additional Capital Contributions. The Members shall not be required to

contribute any additional capital to the Company, and the Member shall not

have any personal liability for any obligation of the Company.

3.1.4. Issuance of Additional Units and Options to Purchase Units. The Company
may issue additional Units to new or existing Members for consideration, and

on other terms and conditions, determined by the Managers, subject to the

limitations and provisions of this Agreement, and the issuance of such Units

may not dilute the voting interest of existing Units then outstanding.

3.2. Distributions. Distributions shall be made to the Members at such times and in

such amounts as determined by the Majority in interest.

Section IV

Management

4.1. Management. Subject to the rights of the Members under the Act or the

provisions of this Agreement to take or approve certain actions, the business

and affairs of the Company shall be managed exclusively by its Manager. The

Manager shall direct, manage, and control the business of the Company to

the best of its ability and, subject only to those restrictions set forth in the Act

or this Agreement, shall have full and complete authority, power and

discretion to make any and all decisions and to do any all things which the

Manager deems appropriate to accomplish the business and objectives of the

Company.

4.2. The Company may appoint and remove such additional agents, officers, and

employees, which such duties, powers and responsibilities as shall be determined by the Manager.

4.3. Manager. The initial Manager of the Company shall be ____. The number of

Managers of the Company shall be fixed from time to time by the Majority In

Interest of the Members, but in no instance shall there be less than one

Manager. Each Manager shall hold office until its resignation or removal.

4.4. Certain Power of the Manager. Without limiting the generality of Section 4.1.,

the Manager shall have power and authority on behalf of the Company:

4.4.1. To acquire property from and sell property to any person as the Manager may

determine. The fact that a Member or Manager is directly or indirectly affiliated or connected with any
such person shall not prohibit the Manager from
dealing with that Person;

4.4.2. To borrow money for the Company from banks, other lending institutions, the

Member, Manager, or affiliates of the Member or Manager on such terms as

the Manager may deem appropriate, and in connection therewith, to

hypothecate, encumber and grant security interest in the assets of the

Company to secure repayment of the borrowed sums;

4.4.3. To purchase liability and other insurance to protect the Manager’s and the

Company’s property and business;

4.4.4. To hold and own any Company real and personal property in the name of the

Company or others as provided in this Agreement;

4.4.5. To invest Company funds temporarily to the extent not required to pay the

current expenses of the Company;

4.4.6. To execute on behalf of the Company all instruments and documents,

including, without limitation, checks, drafts, notes and other negotiable

instruments, mortgages, or deeds of trust, security arrangement, financing

statements, documents providing for the acquisition, mortgage or disposition

of the Company’s property, assignment bills of sales, leases, partnership

agreements, and any other instruments or document necessary, in the opinion

of the Manager, to accomplish the purposes of the Company;

4.4.7. To raise capital or bring in outside investment from various sources, including

but not restricted to equity by selling ownership of the Company or bringing in

partners or investors through cash contributions.

4.4.8. To employ accountants, legal counsel, managing agents or other experts to

perform services for the Company and to compensate them from Company

funds; and

4.4.9. To do and perform all other acts as may be necessary or appropriate to accomplish the purposes
of the Company;

4.5. Manager Has No Exclusive Duty to Company. The Manager shall not be

required to manage the Company as the Manager’s sole and exclusive

activities in addition to those relating to the Company.

4.6. Resignation. Any Manager may resign as a Manager at any time by giving at

least fifteen (15) days’ written notice if its resignation to the Member.

4.7. Removal. Any Manager may be removed, with or without cause, by the

Majority In Interest of the Members, without liability or obligation except as

may be provided in any written contract between the Manager and the

Company.

4.8. Vacancies. Any vacancy occurring for any reason in the office of the Manager

of the Company shall be filled by the ____.

4.9. Compensation and Expenses. The Company may enter into management or

employment contracts, under such terms and conditions and providing for

such compensation as shall be approved by the ____, with one or more

Managers or Persons affiliated with the Managers.

4.10. Books and Records. The Company shall keep or cause to be kept complete

and accurate books and records of the Company and supporting

documentation of transactions with respect to the conduct of the Company’s

business. The books and records shall be kept at the Company’s registered

office and such other location or locations as the Member shall from time to

time determine. At a minimum the Company shall keep at its registered office

the following records:

(a) The full name and business, residence, or mailing address of the

Member;

(b) A copy of the initial Articles and all amendments thereto and restatements

thereof,

(c) Copies of the Company’s federal, state, and local income tax returns and

reports, if any, for the three most recent fiscal years;

(e) Copies of any documents relating to the Members’ obligation to contribute

cash, property, or services to the Company

(f) Copies of any financial statements of the Company for the three most

recent fiscal years; and

(g) Copies of minutes of all meetings of the Member and all written consents

obtained from the Member for actions taken by the Member without a

meeting.

4.11. Indemnity Rights. The Company shall indemnify each Member or Manager

who is party or is threatened to be made a party to any threatened, pending,

or completed action, suit, or proceeding, whether civil, criminal, administrative,

or investigative, by reason of its actions as a Member or Manager or by

reason of its acts while serving at the request of the Company as a director,

officer, employee, or agent of another corporation, partnership, joint venture,

trust, other enterprise, against expenses including attorney’s fees, and against

judgement, fines and amounts paid in settlement actually and reasonable

incurred by it in connection with such action, suit, or proceeding, provided that

the acts of such Manager or Member were not committed with gross

negligence or willful misconduct, and, with respect to any criminal action or

proceeding, such Manager or Member had no reasonable cause to believe its

conduct was unlawful. The termination of any action, suit, or proceeding by

judgment, order, settlement, or conviction, or upon a plea of no contest or its

equivalent shall not, in and of itself, create a presumption that the Manager or

Member acted with gross negligence or willful misconduct, or with respect to

any criminal action or proceeding, had reasonable cause to believe that its

conduct was unlawful.

Additional Members; Dissolution; Termination

5.1. Additional and Substitute Member. No person shall be admitted as a Member

of the Company after the date of formation of the Company without written

consent or approval of the Member. Notwithstanding the foregoing, any

assignee of the Majority in Interest shall automatically become a substitute

Member of the Company.

5.2. Dissolution.

5.2.1. Events of Dissolution. The Company will be dissolved upon the occurrence of

any of the following events:

(a) Upon the written consent of the Member;

(b) Upon the entry of a decree of dissolution under Section 29-785 of the

Act or an administrative dissolution under Section 29-786 of the Act.

5.3. Continuation. An Event of Withdrawal with respect to the Member shall not

cause a dissolution and the Company shall automatically continue following

such as Event of Withdrawal.

5.4. Distribution and Other Matters. The Company shall not terminate until its

affairs have been wound up and its assets distributed as provided herein.

Promptly upon the dissolution of the Company, the Manager shall cause to be

executed and filed a Notice of Winding Up with the Arizona Corporation

Commission in accordance with Section 29-781 of the Act, and will liquidate

the assets of the Company and apply and distribute the proceeds of such

liquidation, or distribute the Company’s assets in kind, as follows and in the

following order:

5.4.1. Debts. To payment of the debts and liabilities of the Company, including debts
owed to the Members or Manager(s), in the order of priority provided by law;

5.4.2. Remainder. The balance shall be distributed to the Member(s) pro rata in

proportion to their Percentage Interests.

5.5. Articles of Termination. When all the assets of the Company have been

distributed as provided herein, the Manager shall cause to be executed and

filed Articles of Termination as required by the Act.

Section VI

Tax Matters

6.1. Tax Treatment. The Company shall be treated as a partnership for federal

and Arizona income tax purposes.

6.2. Tax Allocations. Except as otherwise required by the Internal Revenue Code

or applicable Treasury regulations, during any period in which the Company is

treated as a partnership, any taxable income or loss (and any item thereof) of

the Company shall be allocated to the Members in accordance with their

Percentage Interests and the Company shall maintain capital accounts for

each Member in accordance with Treasury Regulation Section 1.704-1(b)(2).

Section VII

Miscellaneous

7.1. Governing Law; Parties in Interest. This Agreement will be governed by and

construed according to the laws of the State of Arizona without regard to

conflicts of law principles and will bind and inure to the benefit of the heirs,
successors, assigns, and personal representatives of the Member and the

Company.

7.2. Amendment. This Agreement may only be amended, restated, or revoked by

the written consent of the _______.

7.3. Titles and Captions. All article, section, or paragraph titles or captions

contained in this Agreement are for convenience only and are not deemed

part of the context thereof.

IN WITNESS WHEREOF, the Members and Manager has executed this Operating

Agreement, effective as of the date first set forth above.

MANAGER:

__________________________

[Name]

MEMBERS:

__________________________ __________________________

Ernest Hemle Joseph Sugarman

Capital Contributions

As of ______________, 2020

Member’s

Name &

Address

Class

Membership

Interest

(# Units)

Percentage

Interest

Ernest Hemle Class A 100 70%

Joseph

Sugarman Class B 100 30%

Michael Olsen Class B 100 10%