Loading...
The URL can be used to link to this page
Your browser does not support the video tag.
Home
My WebLink
About
14-5044
Supreme Co4rh�*off Pennsylvania Cou i otCominnon leas For Prothonotary Use Only: G vll�C!,6veabSh et ' Docket No: Cu. erlard County The information collected on this form is used solely for court administration purposes. This form does not supplement or replace the filing and service ofpleadings or other papers as required by law or rules of court. Commencement of Action: S rM Complaint 0 Writ of Summons 0 Petition E 0 Transfer from Another Jurisdiction 0 Declaration of Taking C Lead Plaintiff's Name: Lead Defendant's Name: T Bradley Schutjer Chadwick Bogar and Schutjer Bogar, LLC Dollar Amount Requested: ®within arbitration limits X Are money damages requested? xi Yes 0 No (check one) [goutside arbitration limits 0 N Is this a Class Action Suit? Yes I@ No Is this an MDJAppeal? E3 Yes Excl No A Name of Plaintiff/Appel]ant's Attorney: Michael A. Scherer, Esquire 0 Check here if you have no attorney(are a Self-Represented (Pro Se( Litigant) Nature of the Case: Place an"X"to the left of the ONE case category that most accurately describes your PRIMARY CASE. If you are making more than one type of claim,check the one that you consider most important. TORT(do not include Mass Tort) CONTRACT(do not include Judgments) CIVIL APPEALS 0 Intentional 0 Buyer Plaintiff Administrative Agencies 0 Malicious Prosecution 0 Debt Collection:Credit Card 0 Board of Assessment 0 Motor Vehicle 0 Debt Collection:Other 0 Board of Elections Nuisance 0 Dept.of Transportation Premises Liability 0 Statutory Appeal:Other S 0 Product Liability(does not include 0 Employment Dispute: E mass tort) El Slander/Libel/Defamation Discrimination C 0 Other: 0 Employment Dispute:Other 0 Zoning Board T 0 Other: I Other: O MASS TORT 0 Asbestos N 0 Tobacco 0 Toxic Tort-DES 0 Toxic Tort-Implant REAL PROPERTY MISCELLANEOUS 0 Toxic Waste Other: 0 Ejectment 0 Common Law/Statutory Arbitration $i 0 Eminent Domain/Condemnation 0 Declaratory Judgment 0 Ground Rent © Mandamus [] Landlord/Tenant Dispute 0 Non-Domestic Relations El Mortgage Foreclosure:Residential Restraining Order PROFESSIONAL LIABLITY rl Mortgage Foreclosure:Commercial 13 Quo Warranto 0 Dental 0 'Partition 0'Replevin [Q Legal 0 Quiet Title 0 Other: 0 Medical 0 Other: 0 Other Professional: Updated 1/1/2011 BRADLEY SCHUTJER, IN THE COURT OF COMMON PLEAS OF Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA V. NO. `q, S—o q ( ccy C-_ z -•t, CHADWICK BOGAR and CIVIL ACTION-LAW ' r + SCHUTJER BOGAR, LLC Defendants '- `r C) f- NOTICE - t You have been sued in court. If you wish to defend against the claims set forth in the following pages, you must take action within twenty (20) days after this complaint and notice are served, by entering a written appearance personally or by an attorney and filing in writing with the court, your defenses or objections to the claims set forth against you. You are warned that if you fail to do so, the case may proceed without you and a judgment may be entered against you by the court without further notice for any money claimed in the complaint or for any other claim or relief requested by the plaintiff. You may lose money or property or other rights important to you. YOU SHOULD TAKE THIS PAPER TO YOUR LAWYER AT ONCE. IF YOU DO NOT HAVE A LAWYER OR CANNOT AFFORD ONE, GO TO OR TELEPHONE THE OFFICE SET FORTH BELOW. THIS OFFICE CAN PROVIDE YOU WITH INFORMATION ABOUT HIRING A LAWYER. IF YOU CANNOT AFFORD TO HIRE A LAWYER, THIS OFFICE MAY BE ABLE TO PROVIDE YOU WITH INFORMATION ABOUT AGENCIES THAT MAY OFFER LEGAL SERVICES TO ELIGIBLE PERSONS AT A REDUCED FEE OR NO FEE. Cumberland County Bar Association 32 South Bedford Street Carlisle, Pennsylvania 17013 (717) 249-3166 BRADLEY SCHUTJER, IN THE COURT OF COMMON PLEAS OF Plaintiff CUMBERLAND COUNTY, PENNSYLVANIA V. NO. q, CHADWICK BOGAR and CIVIL ACTION-LAW SCHUTJER BOGAR, LLC, Defendants COMPLAINT 1. Plaintiff Bradley Schutjer, is an adult individual who resides at 2 Fairfield Lane, Mechanicsburg, Cumberland County, Pennsylvania 17050. 2. Defendant Chadwick Bogar is an adult individual who resides at 2924 Orchard Lane, Middletown, Dauphin County, Pennsylvania 17057. 3. Schutjer Bogar, LLC, is a Pennsylvania limited liability company with a principal place of business located at 417 Walnut Street, 4th Floor, Harrisburg, Dauphin County, Pennsylvania 17101. 4. Plaintiff brings this action against Defendants for their failure to pay Plaintiff money due and owing Plaintiff. 5. This Court has jurisdiction over this action because this action arises out of Defendants' contacts with this jurisdiction. Venue is proper because the activities which resulted in the formation of the Agreement which is the subject of this action occurred within this county and the payments that the Defendants failed to make were due to be made in this county. BACKROUND 6. Plaintiff and Defendant Bogar were equal equity owners in a limited liability company known as "Schutjer Bogar, LLC" (the "Company."), which Company was engaged in the practice of law. 7. On or about May 24, 2013, Plaintiff and Defendant Bogar executed an agreement (hereinafter "Agreement") relative to Defendants' purchase of and Plaintiff's assignment of Plaintiff's ownership interest in the Company. The Agreement is attached as "Exhibit A." 8. Specifically the Agreement provides that the Second Amended and Restated Operating Agreement would be modified and/or amended pursuant to the Agreement for purposes of Plaintiff's assignment of his ownership interest in the Company and the Defendants' purchase thereof. 9. The Agreement provides that the Defendants would pay Plaintiff for his assignment of his interest in the Company to Defendant. 10. Plaintiff, by virtue of the Agreement, has assigned all of his right, title and interest in the Company to Bogar and/or the Company. 11. Plaintiff has not been associated with the operation of the Company in any way since his execution of the Agreement. 12. Defendants have failed to pay Plaintiff the sums due Plaintiff under the Agreement. 13. Plaintiff has repeatedly demanded payment from Defendants pursuant to Agreement. 14. Despite demand, Plaintiff has not been paid by Defendants. 15. Plaintiff's claim is not subject to any setoff or counterclaim. BREACH OF CONTRACT 16. As set forth above and as evidenced by the Agreement a contract exists between Plaintiff and Defendants pursuant to which Defendant owes Plaintiff the sum of $95,000.00, plus interest, attorney's fees and costs. 17. Defendants' failure to pay Plaintiff the sums due and owing constitutes a breach of contract. 18. Plaintiff has demanded payment of this sum from Defendants, but Defendants, without justification, have failed to pay Plaintiff the sums due and owing Plaintiff. 19. Defendants, therefore, are in breach of their obligations under the Agreement. 20. Paragraph 10 of the Agreement provides that the breaching party shall pay the costs, expenses and attorney's fees of the non-breaching party. 21. As a result of this breach, Plaintiff has suffered damages in the amount of $95,000.00, plus interest and costs. 22. All conditions precedent to recovery under the Agreement have been met, satisfied or waived. 23. Plaintiffs damages continue to accrue each month that payment is not made by the Defendants. WHEREFORE, Plaintiff demands judgment against Defendants in the amount of $95,000.00, plus interest, attorney's fees and costs, and such other relief as the Court deems just and appropriate. Respectfully submitted, BARICSCHERE , LLC Midael A. Scherer, Esquire I.D. # 61974 19 West South Street Carlisle, PA 17013 (717) 249-6873 VERIFICATION The statements in the foregoing Complaint are based upon information which has been assembled by my attorney in this litigation. The language of the statements is not my own. I have read the statements; and to the extent that they are based upon information which I have given to my counsel, they are true and correct to the best of my knowledge, information and belief. I understand that false statements herein are made subject to the penalties of 18 Pa.C.S. § 4904 relating to unsworn falsifications to authorities. DATE: FLa�� ( I radley Schutjer AGREEMENT THIS AGREEMENT is made this��lay of May 2013,by and between Chadwick 0. Bogar("Chad") and Bradley A. Schutjer(`Brad")(together, "Members"). WITNESSETH WHEREAS,Members are parties to a Second Amended and Restated Operating Agreement Schutjer Bogar LLC ("Operating Agreement"); and WHEREAS,the Operating Agreement contains terms to address the departure of Members from Schutjer Bogar LLC including what, if any,pay-out the departing Member will receive; and WHEREAS,Members have reviewed and are familiar with the terms of the Operating Agreement and are both represented by counsel; and WHEREAS,by signing below, Members confirm that they are voluntarily, willingly and knowingly agreeing to modify and/or amend the Operating Agreement as specifically set forth below. Other than those specific changes set forth below,the Operating Agreement shall remain in full force and effect. NOW THEREFORE,the parties intending to be legally bound,agree as follows: 1. The parties agree that it is in the best interest of Schutjer Bogar, LLC (the"firm") that Brad assign his membership interest to Chad and/or the firm in exchange for payment of Brad's membership interest. Brad's membership interest shall be acquired by Chad and/or the firm at the price set forth below. The terms of section 6.01 of the Operating Agreement(except as modified herein) shall govern even though Brad is not certain whether he is"retiring"from the practice of law. Brad shall not, directly or indirectly,conduct any Restricted Activity(as defined in the Operating Agreement) at any time during the entire time any payments are due hereunder(Members intend the Restricted Period(as defined in the Operating Agreement)to be extended for the entire time payments are due hereunder). Consistent with section 6.01, should Brad conduct such Restricted Activities during the extended Restricted Period,he shall forfeit (pro rata) 75%of the payments set forth below in Section 3 with any previous amounts overpaid being returned or offset against future payments and shall also pay to Chad 40% of any gross revenues received by engaging in Restricted Activities as more specifically set forth in section 6.01(c) of the Operating Agreement. The parties agree to waive any required notices as provided therein and make Brad's assignment effective the day hereof. In exchange for the obligations set forth below, Brad will immediately relinquish and turn over to Schutjer Bogar LLC any and all ownership that he has in Schutjer Bogar LLC. 2. Brad represents and agrees by signing below that he has not been denied any leave or benefit requested, has received the appropriate pay for all hours worked for the Firm and has no known workplace injuries or occupational diseases. Brad affirms that he has not filed,nor has he caused to be filed, nor is he presently a party to any claim, complaint,or action against "EXHIBIT All Releasees in any forum or form. Other than the consideration set forth herein, Brad further affirms that he has been paid and/or has received all leave(paid or unpaid),compensation, wages,bonuses and/or commissions to which he may be entitled and that no other leave(paid or unpaid), compensation,wages,bonuses and/or commissions are due to him, except as provided in this Agreement. 3. Section 6.01 of the Operating Agreement shall be amended to provide the following payout terms for the acquisition of Brad's interest, Schutjer Bogar LLC and/or Chad shall pay to Brad the following payments: a. $15,000 on the 15th of every month beginning on July 15,2013 and continuing through June 15,2017;and b. $20,000 on June 15,2013; and C. $150,000 on July 15,2017; and d. Brad elects to continue health coverage in accordance with the continuation requirements of COBRA,Chad shall pay the cost of said coverage for a period of twelve(12)months. 5. Schutjer Bogar LLC and/or Chad shall endeavor through good faith efforts with the Bankruptcy Trustee and the Bank to restructure the Firm debt to have Brad removed as a personal guarantor. Likewise, Chad and the firm will assume all outstanding debts, liabilities and contractual agreements of the firm, including a certain business loan of the firm to Metro Bank which has been personally guaranteed by Members. Chad and the firm hereby indemnify and hold Brad harmless for said obligations, including the obligation to Metro Bank. 6. Brad knowingly and voluntarily releases and forever discharges Chad and Schutjer Bogar LLC as well as his/its parent, affiliates, subsidiaries, divisions,predecessor companies,their successors and assigns,their affiliated and predecessor companies and the current and former employees,attorneys, shareholders,members, officers, directors and agents thereof and Chad knowingly and voluntarily releases and forever discharges Brad and Schutjer Bogar LLC as well as his/its parent, affiliates, subsidiaries, divisions,predecessor companies, their successors and assigns,their affiliated and predecessor companies and the current and former employees, attorneys, shareholders,members, officers, directors and agents thereof (collectively referred to throughout the remainder of this Agreement as"Releasees"), of and from any and all claims, demands, liabilities, obligations,promises,controversies, damages, rights, actions and causes of action,known and unknown, which Brad or Chad have or may have against Releasees as of the date of execution of this Agreement, examples include,but are not limited to,any alleged violation of: • Title VII of the Civil Rights Act of 1964, as amended; • The Civil Rights Act of 1991; • Sections 1981 through 1988 of Title 42 of the United States Code, as amended; 2 * The Employee Retirement Income Security Act of 1974,as amended; • The Immigration Reform and Control Act, as amended; o The Americans with Disabilities Act of 1990, as amended; The Age Discrimination in Employment Act of 1967, as amended; • The Older Workers Benefit Protect Act; The Workers Adjustment and Retraining Notification Act, as amended; + The Occupational Safety and Health Act, as amended; m The Equal Pay Act of 1963; The Genetic Information Nondiscrimination Act; The Family and Medical Leave Act; a Uniformed Services Employment and Reemployment Rights Act; • The Consolidated Omnibus Budget Reconciliation Act of 1985; +� Any other federal, state or local civil or human rights law or any other local, state public policy, contract,tort, or common law; or a Any allegation for costs, fees, or other expenses including attorneys' fees incurred in these matters (all of the above collectively referred to as "Claims"). 7. This release is intended to be a general release, and excludes only those claims under any statute or common law that Members are legally barred from releasing. Members are advised to seek independent legal counsel if they seek clarification on the scope of this release. Signing this Agreement does not waive Members' right to seek a judicial determination of the validity of Members' release of rights arising under the Age Discrimination in Employment Act. 8. Nothing herein is intended to or shall preclude Members from filing a charge with any appropriate federal, state, or local government agency and/or cooperating with said agency in its investigation. Members,however, explicitly waive any right to file a personal lawsuit or receive monetary damages that the agency may recover against Releasees, without regard as to who brought any said complaint or charge, except for matters related to the enforcement of this agreement. 9. Should the firm be acquired,merged or should the assets of the firm be purchased by a third parry entity, the buyout of Brad's interest in the firm as set forth herein shall remain an obligation of the acquiring or successor entity to the firm,and the obligations of Chad and the firm to Brad as set forth herein shall remain in full force and effect. Likewise, if Chad becomes employed by an entity which is separate from the firm, or if Chad is otherwise gainfully employed by or consults with an entity other than the firm in substantially the same practice area of the firm, Chad shall be personally liable to Brad for the buyout provisions of this agreement. 10. It is expressly stipulated that in the event that either party breaches any provision of this Agreement, he or she shall be responsible for any and all costs incurred to enforce the Agreement, including, but not limited to, court cost and counsel fees of the other party. In the event of breach, the other party shall have the right, at his or her election; to sue for damages for such breach or to seek such other and additional remedies as may be available to him or her. 3 11. The firm shall maintain life insurance on Chad with sufficient proceeds payable to Brad to ensure performance of this agreement. 12. Neither of the parties shall disparage one another with respect to matters relating to one another's conduct in connection with the operation of the firm and neither shall disclose the terms of this agreement to a third party except as required for bankruptcy Court approval,tax advice and preparation, insurance claims and any similar, related matter. Nothing herein shall restrict either Member's ability to truthfully respond to inquiries posed regarding matters related to this Agreement. h r _U..........1-' Chadwick O. Bogar Bra ey A. U utjer 4 BRADLEY SCHUTJER, IN THE COURT OF COMMON PLEAS OF Plaintiff .. CUMBERLAND COUNTY, PENNSYLVANIA v. NO. 2014-5044 CIVIL TERM CHADWICK BOGAR and SCHUTJER BOGAR, LLC, Defendants : CIVIL ACTION -LAW ACCEPTANCE OF SERVICE AND NOW, this \ C7 ay of September, 2014, I, Chadwick Bogar, accept service of the Complaint in the above -captioned matter. C\)c Chadwick Bogar / Schutjer Bogar, LLC 1426 N. Third Street P.O.Box 5400 Harrisburg, PA 17110 CD C) -n} Crn -o r1 r ..-,.C: .D -4 C) .. C) 70, C) -71 y7' C) :� cj Z c7 T,. CERTIFICATE OF SERVICE I hereby certify that I am this day serving the foregoing Acceptance of Service upon the person and in the manner indicated below which service satisfies the requirements of Pa.R.A.P. 1514: Dated: ()On\ Service by first class mail addressed as follows: Michael A. Scherer, Esquire 19 West South Street Carlisle, PA 17013 • Tonya Dau_1=erty, Paralegal Ronny R Anderson Sheriff Jody S Smith Chief Deputy Richard W Stewart Solicitor SHERIFF'S OFFICE OF CUMBERLAND COUNTY at ermube' r|UL Tpc -- P11 2 ,° CUMBERLAND COUNTY PENNSYLVANIA —''` Bradley A Schutjer vs. Chadwick 0. Bogar (et al.) Case Number 2014-5044 SHERIFF'S RETURN OF SERVICE 08/ 28/2014 Sheriff Ronny R Anderson, being duly sworn according to law, states he made diligent search and inquiry for the within named Defendant to witSchutjer Bogar LLC, but was unable to Iocate the Defendant in the Sheriffs bailiwick. The Sheriff therefore deputizes the Sheriff of Dauphin, Pennsylvania to serve the within Complaint & Notice according to aw. 08/28C2014 Sheriff Ronny R Anderson, being duly sworn according to law, states he made diligent search and inquiry for the within named Defendant to wit: Chadwick 0. Bogar, but was unable to locate the Defendant in the Sheriffs bailiwick. The Sheriff therefore deputizes the Sheriff of Dauphin, Pennsylvania to serve the within Complaint & Notice according to law. 09/03/2014 The requested Complaint & Notice returned by the Sheriff of Dauphin County, the within named Defendant Chadwick 0. Bogar, not found. Jack Lotwick, Sheriff, Return of Service attached to and made part of the within record. 09/16/2014 11:24 AM - The requested Complaint & Notice served by the Sheriff of Dauphin County upon Jonathan Crist, who accepted for Schutjer Bogar LLC, at 1426 N. 3rd Street, Suite 200, Harrisburg, PA 17101. Jack Lotwick, Sheriff, Return of Service attached to and made part of the within record. SHERIFF COST: $53.00 SO ANSWERS, September 16, 2014 RONR ANDERSON, SHERIFF (C) CountriSuite Sheriff, Teleosoft, Inc. Shelley Ruhl Real Estate Deputy Matthew L. Owens Solicitor Commonwealth of Pennsylvania County of Dauphin Dauphin County 101 Market Street Harrisburg, Pennsylvania 17101-2079 ph: (717) 780-6590 fax: (717) 255-2889 Jack Lotwick Sheriff BRADLEY SCHUTJER VS SCHUTJER BOGAR, LLC Sheriffs Return No. 2014-T-2408 OTHER COUNTY NO. 2014-5044 Jack Duignan Chief Deputy Michael W. Rinehart Assistant Chief Deputy I, Jack Lotwick, Sheriff of the County of Dauphin, State of Pennsylvania, do hereby certify and return, that I made diligent search and inquiry for CHADWICK 0. BOGAR the DEFENDANT named in the within NOTICE & COMPLAINT and that I am unable to find him/her in the County of Dauphin, and therefore return same NOT FOUND, SEPTEMBER 3, 2014. PER RON BLACK, EX -FATHER-IN-LAW OF DEFENDANT AND RESIDENT OF ADDRESS 2924 ORCHARD LANE, MIDDLETOWN, PA 17057, THE DEFENDANT HAS NEVER RESIDED THERE. CURRENT LOCATION IS UNKNOWN. 9/10/14 - PER JNET, ADDRESS LISTED FOR CHADWICK O. BOGAR IS 112 HUNT COURT, HUMMELSTOWN, PA 17036, HOWEVER PER TAX ASSESSMENT, DEFENDANT SOLD PROPERTY IN 2013 AND HAS NOT UPDATED ADDRESS ON DRIVERS LICENSE. STAFF AT SCHUTJER BOGAR, LLC BELIEVE DEFENDANT IS RESIDING WITH HIS GIRLFRIEND, HOWEVER NAME AND LOCATION IS UNKNOWN. Sworn and subscribed to before me this 12TH day of September, 2014 COMMONWEALTH OF PENNSYLVANIA NOTARIAL SEAL Karen M. Hoffman, Notary Public City of Harrisburg, Dauphin County My Commission Expires January 8, 2018 By Dep Sheriff De : J STRAINING Sheriffs Costs: $77.5 8/29/2014 Shelley Ruhl Real Estale Deputy Matthew L. Owens Sol icitor Commonwealth of Pennsylvania County of Dauphin Dauphin County 101 Market Street Harrisburg, Pennsylvania 17101-2079 ph: (717) 780-6590 fax: (717) 255-2889 Jack Lotwick Sheriff r Jack Duignan Chief Deputy Michael W. Rinehart Assistant Chief Deputy BRADLEY SCHUTJER VS SCHUTJER BOGAR, LLC Sheriffs Return No. 2014-T-2408 OTHER COUNTY NO. 2014-5044 And now: SEPTEMBER 10, 2014 at 11:24:00 AM served the within NOTICE & COMPLAINT upon SCHUTJER BOGAR, LLC by personally handing to JONATHAN CRIST * 1 true attested copy of the original NOTICE & COMPLAINT and making known to him/her the contents thereof at 1426 NORTH 3RD STREET, SUITE 200 HARRISBURG PA 17102 DEFENDANT MOVED FROM ADDRESS 417 WALNUT STREET, 4TH FLOOR, HARRISBURG, PA 17101 TO ADDRESS LISTED ABOVE. * ATTORNEY Sworn and subscribed to before me this 12TH day of September, 2014 COMMONWEALTH OF PENNSYLVANIA NOTARIAL SEAL Karen M. Hoffman, Notary Public City of Harrisburg, Dauphin County My Commission Expires January 8, 2018 So Answers, She By auphin C Deputy Sheriff Deputy: DARIN S SHE Sheriffs Costs: $77.5 8 Y 9/2014 .„, IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA BRADLEY A. SCHUTJER, Plaintiff No. 2014-5044 v. CIVIL ACTION — LAW CHADWICK O. BOGAR and SCHUTJER BOGAR, LLC, Defendants JURY TRIAL DEMANDED NOTICE TO PLEAD To: Bradley A. Schutjer and his Attorney: Michael A. Scherer, Esq. BARIC SCHERER, LLC 19 West South Street Carlisle, PA 17013 n, CID --t rte: r) You are hereby notified to file a written response to the enclosed Preliminary Objections of Schutjer Bogar LLC within twenty (20) days from service or a judgment may be entered against you. DATE: 72-/ Jon an M. Crist, Esq. PA Atty ID # 29936 1426 N. Third Street, Suite 200 PO Box 5400 Harrisburg PA 17110 PH: (717) 712-3131 FX: (717) 909-5925 Attorney For Schutjer Bogar, LLC Jonathan M. Crist, Esq. 1426 N. Third Street, Suite 200 PO Box 5400 Harrisburg PA 17110 PH: (717) 712-3131 FX: (717) 909-5925 Attorney For Schutjer Bogar, LLC IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA BRADLEY A. SCHUTJER, Plaintiff No. 2014-5044 v. CIVIL ACTION — LAW CHADWICK O. BOGAR and SCHUTJER BOGAR, LLC, Defendants JURY TRIAL DEMANDED PRELIMINARY OBJECTIONS OF DEFENDANT SCHUTJER BOGAR LLC AND NOW comes Defendant, SCHUTJER BOGAR, LLC ("SBLLC"), by its attorney, Jonathan M. Crist, Esq and pursuant to Pennsylvania Rule of Civil Procedure 1028 makes the following Preliminary Objections to Plaintiffs Complaint: 1. Failure to Conform to Law or Rule of Court (Rule 1028(a)(2)) (A) Where an action is founded upon a writing, the complete writing shall be attached to the Complaint. (B) The May 24, 2013 Agreement (the "May 24, 2013 Agreement") which is attached as Exhibit "A" to Plaintiff's Complaint recites that it is an modification and/or amendment to that certain undated June 2011 SECOND AMENDED AND RESTATED OPERATING AGREEMENT between Plaintiff Bradley A. Schutjer and Defendant Chadwick O. Bogar concerning their ownership interests in Schutjer Bogar LLC (the "Restated Members Agreement"), and to the extent not contradicted by the May 24th 2013 Agreement the terms and conditions of the Restated Members Agreement "shall remain in full force and effect". A copy of the Restated Members Agreement is attached hereto as Exhibit "1" to these Preliminary Objections. 2. Legal Insufficiency of a Pleading (Demurrer) (Rule 1028(a)(4)) (A) A limited liability company is an entity separate and distinct from its members. (B) Both the Restated Members Agreement and the May 24th 2013 Agreement were solely between Plaintiff Bradley A. Schutjer and Defendant Chadwick O. Bogar. SBLLC is neither a named party, nor a signatory, to either the Restated Members Agreement or the May 24th 2013 Agreement. (C) Under the May 24th 2013 Agreement Plaintiff Bradley A. Schutjer's member interest in SBLLC was transferred to Defendant Chadwick O. Bogar and not to SBLLC. (D) On March 20, 2013,.Defendant SBLLC filed for Chapter 11 Bankruptcy reorganization docketed at No. 1:13-bk-01434-RNO in the United States District Court For The Middle District of Pennsylvania (the "SBLLC Bankruptcy"). At the time of its execution, the May 24th 2013 Agreement was never presented to or approved by the Bankruptcy Court as part of the SBLLC Bankruptcy. To impose any obligations upon Defendant SBLLC, the May 24th 2013 Agreement would have had to have been submitted to and approved within the SBLLC Bankruptcy by all of SBLLC's creditors and the Bankruptcy Court since it would make SBLLC a party to proposed transfers/payments by the Debtor to an insider/owner. (E) The transfer of Plaintiff Bradley A. Schutjer's member interest in SBLLC to Defendant Chadwick 0. Bogar under the May 24th 2013 Agreement provided no value or benefit to SBLLC; at the time of the transfer of Plaintiff Bradley A. Schutjer's member interest in SBLLC to Defendant Chadwick 0. Bogar and at all times subsequent thereto, SBLLC has been insolvent with liabilities in excess of assets. (F) For all of the above reasons, SBLLC has no legal obligation to make any of the payments claimed by the Plaintiff in the Complaint in this matter. 3. Agreement For Alternative Dispute Resolution (Rule 1028(a)(6)) To the extent that it is determined that SBLLC should remain as a party in this lawsuit or that SBLLC may have liability for any of the payments to Plaintiff Bradley A. Schutjer under May 24th 2013 Agreement, then SBLLC invokes Section 6.07 of the Restated Members Agreement which requires mandatory mediation of the dispute which is the subject of the Complaint prior to the filing of litigation. 4. Improper Venue (Rule 1028(a)(1)) To the extent that it is determined that SBLLC should remain as a party in this lawsuit or that SBLLC may have liability for any of the payments to Plaintiff Bradley A. Schutjer under May 24th 2013 Agreement, then SBLLC invokes the agreed venue of Dauphin County Pennsylvania as set forth in Section 12.07 of the Restated Members Agreement. 5. Insufficient Specificity In A Pleading — More Definite Statement (Rule 1028(a)(3)) To the extent that it is determined that SBLLC should remain as a party in this lawsuit or that SBLLC may have liability for any of the payments to Plaintiff Bradley A. Schutjer under May 24th 2013 Agreement, then SBLLC moves for more definite statement in that Plaintiff's Complaint: (i) fails to specify the dates and amounts of payments which were allegedly not made to Plaintiff Bradley D, Schutjer under the May 24th 2013 Agreement and/or (ii) fails to specify how the sum of $95,000.00 claimed as damages was calculated or arrived at. WHEREFORE, Defendant, Schutjer Bogar, LLC, demands that it be dismissed as a party Defendant from this lawsuit with an award of attorney fees to Schutjer Bogar LLC in the amount of Two Thousand ($2, I C,! 0 Dollars. DATE: I 2Soi V J athan M. Crist, Esq. PA Atty ID # 29936 1426 N. Third Street, Suite 200 PO Box 5400 Harrisburg PA 17110 PH: (717) 712-3131 FX: (717) 909-5925 Attorney For Schutjer Bogar, LLC VERIFICATION The facts in the above Preliminary Objections are based upon information which has been gathered by me as counsel in preparation of the defense of the Complaint. I am the attorney for Defendant Schutjer Bogar, LLC and authorized to take this verification on its behalf. I hereby acknowledge that the facts set forth in the aforesaid Preliminary Objections are made subject to the penalties of 18 Pa.C.S. §4904 relating to unsworn falsification to authorities. DATE: di 121 (leul NATHAN M. CRIST, ESQ. EXHIBIT "1" SECOND AMENDED AND RESTATED OPERATING AGREEMENT SCHUTJER BOGAR LLC A Pennsylvania Limited Liability Company THIS SECOND AMENDED AND RESTATED OPERATING AGREEMENT (this "Agreement") is made this day of June, 2011, by and between CHADWICK O. BOGAR, an adult individual ("Chad"), and BRADLEY A. SCHUTJER, an adult individual ("Brad") (Chad and Brad being hereinafter sometimes individually referred to as a "Member" and collectively as the "Members"). WITNESSETH: A. By Certificate of Organization filed with the Pennsylvania Department of State on February 12, 2004 (and resubmitted on March 5, 2004) (the "Certificate"), the Members and John K. Kennedy ("Kennedy") organized a Pennsylvania limited liability company known as Kennedy Bogar LLC (the "Company"). B. The Company, which has been assigned Entity No. 3186867 by the Pennsylvania Department of State, and EIN 80-0089736 by the Internal Revenue Service, is a restricted professional company, organized to render professional legal services. C. The Members and Kennedy entered into a certain Operating Agreement, executed on January 11, 2004 (the "Initial Agreement"), to govern the affairs of the Company. D. On December 24, 2004, Kennedy resigned from the Company. E. By Certificate of Amendment filed with the Pennsylvania Department of State on January 21, 2005 (and resubmitted on February 24, 2005), the Members amended the Certificate to change the name of the Company to Schutjer Bogar LLC, and to change the registered office of the Company. F. By Addendum dated March 10, 2006, the Members made certain changes to the Initial Agreement and adopted an Amended and Restated Operating Agreement. G. The Members desire to amend and restate all of their prior agreements, in accordance with the terms and conditions of this Agreement. NOW, THEREFORE, the parties, intending legally to be bound hereby, agree as follows. ARTICLE I DEFINITIONS 1.01 Definitions. As used in this Agreement, the following terms have the following meanings: "Act" means the Pennsylvania Limited Liability Company Law of 1994, 15 Pa.C.S. § 8901 et seq., as amended, and any successor statute, as amended from time to time. "Business Day" means any day other than a Saturday, a Sunday, or holidays on which national banking associations in the Commonwealth of Pennsylvania are closed. "Capital Contribution" means any contribution by a Member to the capital of the Company. "Code" means the Internal Revenue Code of 1986, as amended, and any successor statute, as amended from time to time. "Disability" means that: (A) a Member (1) has been unable to perform or conduct his normal activities on behalf of the Corporation for a period of six consecutive months or more, or (2) has been unable to perform same for a total of twelve months in any twenty-four month period, due to medical or psychological reasons; or (B) Dr. Richard Harker, or, if he is not willing or able to do so, another independent, qualified physician, psychiatrist or clinical psychologist ("Physician"), as appropriate, has declared to a reasonable degree of medical certainty, after examination of the Member, that the Member is disabled due to medical or psychological reasons and is not expected to sufficiently recover from his disability so as to be able to perform or conduct his normal activities on behalf of the Company in six (6) months; or (C) a Member has made a claim on and is paid under any long term disability policy (Company- owned or individually -owned). Each Member agrees, to the extent reasonably practicable, to make himself available for an examination by the Physician, and to follow the recommendation of the Physician regarding further examination and testing. In connection with a determination as to whether such Member is suffering from a Disability, each Member intends for the other Member to be treated as the Member in question would be with respect to his rights regarding the use and disclosure of his individually identifiable health information or other medical records. This release authority applies to any information governed by the Health Insurance Portability and Accountability Act of 1996 (a/k/a HIPAA), 42 USC 1320d and 45 CFR 160-164 and authorizes: any physician, health-care professional, dentist, health plan, hospital, clinic, laboratory, pharmacy or other covered health-care provider, any insurance company and the Medical Information Bureau Inc. or other health-care clearinghouse that has provided treatment or services to him, or that has paid for or is seeking payment from him for such services, to give, disclose and release to the Company and to the other Member, without restriction, all of such Member's individually identifiable health information and medical records regarding any past, present or future medical or mental health condition, including all information relating to the diagnosis and treatment of HIV/AIDS, sexually transmitted diseases, mental illness, and drug or alcohol abuse, but only to the extent, however, relevant to a determination as to whether or not a Member is suffering from a Disability. "Default Interest Rate" means a rate per annum equal to the prime interest rate publicly quoted by The Wall Street Journal, Eastern Edition from time to time plus four percent (4%), with adjustments in that varying rate to be made on the same date as any change in that rate. "Founding Members" means Chad and Brad. "General Interest Rate" means a rate per annum equal to a varying rate per annum that is equal to the prime interest rate publicly quoted by The Wall Street Journal, Eastern Edition from 2 time to time plus two percent (2%), with adjustments in that varying rate to be made on the same date as any change in that rate. "Highest Possible Payout Rate" means a payment of $10,000 per month for each year such person had been a Member of the Company and such monthly payments shall continue until the payments have been made to such Member equal to the number of years such Member had been a Member of the Company. By way of example, if the Member had been a Member for exactly ten years, such Member would be paid a total of $1,200,000 ($10,000 x 12 months x 10 years = $1,200,000) over a period of 120 months. "Majority Interest" means one or more Members having among them more than fifty percent (50%) of the Membership Percentages of all Members permitted to vote on such matter. "Member" means any person executing this Agreement as of the date of this Agreement as a member or hereafter admitted to the Company as a member as provided in this Agreement, but does not include any person who has ceased to be a member in the Company. "Membership Interest" means the ownership interest of a Member in the Company and all rights appurtenant thereto, including, without limitation, rights to distributions (liquidating or otherwise), allocations, information, voting, consent and approval. "Membership Percentage" means the fifty percent (50%) for each Member. "PaBCL" means the Pennsylvania Business Corporation Law of 1988, 15 Pa.C.S. §1101 et seq., as amended, and any successor statute, as amended from time to time. "Restricted Activities" means a Member who during the one year period ("Restricted Period") commencing on the effective date of the Member's Withdrawal or Retirement (the "Separation Date") directly or indirectly, on his or her own behalf or as a partner, shareholder, member, or employee of another person or entity: provides legal services or advice (whether written or oral) to or for (A) any person or entity who, during the 12 -month period prior to the Separation Date was a client of the Company, including any client who elects to be represented by the withdrawing Member pursuant to Section 3.07(d) above ("Former Client"), or (B) any person or entity who owns or operates (or who is licensed to own or operate) a long-term care nursing facility, personal care home, community care retirement community, or assisted living facility within the Commonwealth of Pennsylvania. In the event that a court of competent jurisdiction shall determine that one or more of the provisions of the Restricted Activities is so broad as to be unenforceable, then such provision shall be deemed to be reduced in scope or length, as the case may be, to the extent required to make this Paragraph enforceable. If the Member violates the Restricted Activities, the periods described therein shall be extended by that number of days which equals the aggregate of all days during which at any time any such violations occurred. "Section 409A" means Section 409A of the Code, and the regulations and other binding guidance promulgated thereunder. "Separation Date" means the date identified in the definition of Restricted Activities. 3 "Super Majority Interest" means one or more Members having among them more than Two -Thirds (2/3) of the Membership Percentages of the Members permitted to vote on such matter. "Transfer" means to sell, give, transfer, bequeath, pledge, encumber or otherwise dispose of, whether voluntarily or involuntarily by operation of law. "Unanimous" means all Members having among them 100% of the Membership Percentages of all Members permitted to vote on such matter. Other terms defined herein have the meanings so given them. 1.02 Construction. Whenever the context requires, the gender of all words used in this Agreement includes the masculine, feminine, and neuter. All references to Articles and Sections refer to articles and sections of this Agreement, and all references to Exhibits are to Exhibits attached hereto, each of which is made a part hereof for all purposes. ARTICLE II ORGANIZATION 2.01 Formation. The Company has been organized as a Pennsylvania limited liability company, and restricted professional company, by the filing of the Certificate with the Department of State of the Commonwealth of Pennsylvania under and pursuant to the Act. 2.02 Name. The name of the Company is "Schutjer Bogar LLC", and all Company business must be conducted in that name or such other names that comply with applicable law as the Members may select from time to time. 2.03 Registered Office; Registered Agent; Principal Office in the United States; Other Offices. The registered office of the Company required by the Act to be maintained in the Commonwealth of Pennsylvania shall be 1426 N. 3rd Street, Suite 200, Harrisburg, Dauphin County, Pennsylvania 17105, or such other office (which need not be a place of business of the Company) as the Members may designate from time to time in the manner provided by law. The principal office of the Company shall be at such place as the Members may designate from time to time, which need not be in the Commonwealth of Pennsylvania. The Company may have such other offices as the Members may designate from time to time. 2.04 Purpose. The Company is organized to render professional legal services as a restricted professional company under the Act. 2.05 Foreign Qualification. Prior to the Company's conducting business in any jurisdiction other than the Commonwealth of Pennsylvania, the Members shall cause the Company to comply with all requirements necessary to qualify the Company as a foreign limited liability company in that jurisdiction. Each Member shall execute, acknowledge, swear to, and deliver all certificates and other instruments conforming with this Agreement that are necessary or appropriate to qualify, continue, and terminate the Company as a foreign limited liability company in all such jurisdictions in which the Company may conduct business. 4 2.06 Term. The Company commenced on the date the Certificate was filed with the Department of State of the Commonwealth of Pennsylvania, and shall continue in existence in perpetuity, or such earlier time as this Agreement may specify. 2.07 No State -Law Partnership. The Members intend that the Company not be a partnership (including, without limitation, a limited partnership) or joint venture, and that no Member be a partner or joint venturer of any other Member, for any purposes other than for federal and state income tax purposes, and this Agreement shall not be construed to produce a contrary result. ARTICLE III MEMBERSHIP, RESTRICTIONS ON TRANSFERS 3.01 Members. Chad and Brad are the Founding Members, and are currently all of the Members of the Company. 3.02 No Certification. No Membership Interest in the Company shall be required to be represented by a separate certificate. 3.03 General Restrictions on Transfer. Except as otherwise expressly provided in this Agreement, at no time shall any Member or their legal representative Transfer, or attempt to Transfer, any of their Membership Interest without the Unanimous written consent of the Members. 3.04 Liability to Third Parties. Except as provided in this Agreement, no Member shall be liable for the debts, obligations or liabilities of the Company, including under a judgment decree or order of a court. 3.05 Information. (a) In addition to the other rights specifically set forth in this Agreement, each Member is entitled to all information to which that Member is entitled to have access pursuant to Sections 1508 and 1764 of the PaBCL under the circumstances and subject to the conditions therein stated. (b) The Members acknowledge that, from time to time, they may receive information from or regarding the Company in the nature of trade secrets or that otherwise is confidential, the release of which may be damaging to the Company or persons with which it does business. Each Member shall hold in strict confidence any information it receives regarding the Company that is identified as being confidential (and if that information is provided in writing, that is so marked) and may not disclose it to any person other than another Member, except for disclosures (i) compelled by law (but the Member must notify the other Members promptly of any request for that information before disclosing it, if practicable), (ii) to advisers or representatives of the Member or persons to which that Member's Membership Interest may be transferred as permitted by this Agreement, but only if the recipients have agreed to be bound by the provisions of this Section 3.05(b), or (iii) of information that Member also has received from a source independent of the Company that the Member reasonably believes obtained that information without breach of any obligation of confidentiality. The Members 5 acknowledge that breach of the provisions of this Section 3.05(b) may cause irreparable injury to the Company for which monetary damages are inadequate, difficult to compute, or both. Accordingly, the Members agree that the provisions of this Section 3.05(b) may be enforced by specific performance or injunction (temporary or permanent) without the necessity of proving damages, actual or otherwise. 3.06 Additional Members. Additional persons may be admitted to the Company as Members and additional Membership Interests may be created and issued to those persons at the direction of the Members upon the affirmative vote of a Super Majority Interest of the Members and on such terms and conditions as the Members may determine at the time of admission. The terms of admission or issuance may provide for the creation of different classes or groups of Members andhaving different preferences, rights, powers, and duties with respect to the Company. The Members may reflect the creation of any new class or group through the filing of an amendment to the Certificate and/or in an amendment to this Agreement. Any such admission is effective only after the new Member has executed and delivered to the other Members a document including the new Member's notice address and its agreement to be bound by this Agreement. 3.07 Voluntary Withdrawal of a Member. (a) In the event that any Member desires to withdraw voluntarily from the Company (other than as part of permanent retirement pursuant to Section 6.01 below) ("Withdrawal"), he or she shall serve upon the other Member(s) written notice of intention to do so. Notice shall be served at least three (3) full months prior to the effective date of the Withdrawal, unless the Company shall expressly consent to an earlier date by the affirmative vote of not less than fifty-one percent of the remaining Membership Percentages (excluding the withdrawing Member). The effective date of a Withdrawal shall in every case be the last day of a calendar month. The Company shall pay the withdrawing Member's monthly distribution through the effective date of the Withdrawal, pro rated for any partial month, for each month after he or she shall.give notice, so long as he or she continues to devote his or her time diligently and faithfully to the business of the Company (pursuant to Section 7.07 below) until the Withdrawal becomes effective. In the case where a Withdrawal from the Company is other than the last day of a calendar month, the Member shall receive a pro rata portion of what would have been the Member's distribution for that month, and an allocation of income and loss pursuant to Section 5.01 hereof, determined by dividing the number of business days in the month during which the Member continued as a Member in the Company by the total number of business days in the month. Notwithstanding any matter contained in this Section 3.07, the other Member(s) shall have the right and authority to make any Withdrawal effective earlier than the aforesaid effective date, to the extent deemed to be in the best interests of the Company by a vote of at least fifty-one percent of the remaining Membership Percentages (excluding the withdrawing Member). (b) It is expressly understood and agreed that, pursuant to Section 8971(a)(4) of the Act, a Withdrawal shall not cause the dissolution of the Company, and the Company shall have the right to continue under its present name, except to the extent otherwise provided by applicable law. 6 (c) If a Member withdraws from the Company, all interest of the withdrawing Member in the Company, and its property and assets of any nature whatsoever, including goodwill, shall be terminated as of the effective date of his or her Withdrawal and such interest shall be liquidated with the sole consideration therefor being the payment of 50% of the Highest Possible Payout Rate being paid on a monthly basis over the applicable number of months. Payments to the withdrawing Member are intended to represent payments for a Member's interest under Section 736(b) of the Code for the withdrawing Member's interest in the Company's property, including goodwill and other intangibles of the Company. If, the withdrawing Member engages in Restricted Activities during the Restricted Period, the withdrawing Member's sole consideration shall be 25% of the Highest Payout Rate being paid on a monthly basis with any previous amounts overpaid being returned or offset against future payments. Additionally, the withdrawing Member shall pay to the Company 40% of any gross revenue that the withdrawing Member, or those acting on behalf of or in conjunction with the withdrawing Member, earn (regardless of when actually paid to the withdrawing Member) by engaging in Restricted Activities. The withdrawing Member hereby agrees that he or she shall not have the right to receive any amounts pursuant to Section 8933 of the Act. (d) Each Member covenants that in the event he or she shall withdraw from the Company, he or she will fully cooperate in good faith in making an orderly transfer to the remaining Members of all pending matters pertaining to the affairs of those clients whose business he or she has carried on or supervised, unless any such client shall expressly elect to continue to be represented by the withdrawing Member. Subject to Section 3.07(c) above, if any client shall elect to continue to be represented by the withdrawing Member, and the withdrawing Member shall elect to continue to represent the client, the withdrawing Member shall be entitled to receive all papers and work -in -progress pertaining to the affairs of the client upon payment to the Company of an amount equal to all unpaid bills charged against the client plus the value of all unbilled work -in -progress which has been performed for the client to the Separation Date (the value to be computed at the then prevailing rate generally charged for such services) and all unbilled disbursements to such date. Upon payment of said amount, the withdrawing Member shall be entitled to all fees thereafter collected from the client, subject to 3.07(c) above, and the Company shall assign its rights to the withdrawing Member. The Company shall be authorized to set off any payments due the withdrawing Member against any other amount(s) which the Company is entitled from the withdrawing Member. (e) The liability of any withdrawing Member for any act or thing which shall occur on or before the Separation Date shall not be affected by his or her Withdrawal. (f) The Members further acknowledge and agree that it is and shall be their intention that the terms and conditions of this Section 3.07 shall comply with all rules and requirements applicable to the practice of law (including, without limitation intended, Rule 5.6 of the Pennsylvania Rules of Professional Conduct). If any term or provision of this Section 3.07 or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Section 3.07 or the application of any such term or provision to persons or circumstances, other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Section 3.07 shall be valid and enforceable to the fullest extent permitted by law. 7 ARTICLE IV CAPITAL CONTRIBUTIONS 4.01 Capital Contributions. (a) The Members heretofore made the initial Capital Contributions, in cash, in kind or otherwise, described for that Member in Exhibit A attached hereto. (b) After the initial Capital Contribution, the Company may require each Member to make additional Capital Contributions from time to time; provided that, any request of a Member to make a Capital Contribution shall require the affirmative vote of a Super Majority Interest of the Members. 4.02 Failure to Contribute. If a Member does not contribute by the time required all or any portion of a Capital Contribution which that Member is required to make as provided in this Agreement, the Company shall have such rights and remedies as may be available at law or in equity. 4.03 Return of Contributions. A Member is not entitled to the return of any part of its Capital Contributions or to be paid interest in respect of either its capital account or its Capital Contributions. An unretumed Capital Contribution is not a liability of the Company or of any Member. A Member is not required to contribute or to lend any cash or property to the Company to enable the Company to return any Member's Capital Contributions. 4.04 Advances by Members. If the Company does not have sufficient cash to pay its obligations, any Member(s) that may agree to do so with the other Members' consent may advance all or part of the needed funds to or on behalf of the Company. An advance described in this Section 4.04 constitutes a loan from the Member to the Company, bears interest at the General Interest Rate from the date of the advance until the date of payment, and is not a Capital Contribution. 4.05 Capital Account. A capital account shall be established and maintained for each Member in accordance with applicable provisions of the Code and applicable regulations. A Member that has more than one Membership Interest shall have a single capital account that reflects all its Membership Interests, regardless of the class of Membership Interests owned by that Member and regardless of the time or manner in which those Membership Interests were acquired. On the transfer of all or part of a Membership Interest as permitted by this Agreement, the capital account of the transferor Member that is attributable to the transferred Membership Interest or part thereof shall carry over to the transferee Member in accordance with the Code and applicable regulations. ARTICLE V ALLOCATIONS AND DISTRIBUTIONS 5.01 Allocations. Except as may be required by the Code and applicable regulations and unless otherwise agreed to among the Members, all items of income, gain, loss, deduction, and credit of the Company shall be allocated among the Members in accordance with their Membership Percentages. 8 5.02 Distributions. (a) From time to time (but at least monthly), the Members shall determine in their reasonable judgment to what extent (if any) the Company's cash on hand exceeds its current and anticipated needs, including, without limitation, for operating expenses, debt service, acquisitions, and a reasonable contingency reserve. If such an excess exists, the Members shall cause the Company to distribute to the Members an amount in cash equal to that excess, which shall be their draw from the Company. (b) From time to time, the Members also may cause property of the Company other than cash to be distributed to the Members, which distribution must be made in accordance with their Membership Interest, unless otherwise agreed to by the affirmative vote of a Super Majority Interest of the Members, and may be made subject to existing liabilities and obligations. ARTICLE VI RETIREMENT, EXPULSION, DISABILITY, DEATH 6.01 Retirement. (a) In the event that any Member desires to retire permanently from the practice of law and withdraw from the Company as a result of such permanent retirement ("Retirement"), he or she shall serve upon the other Members written notice of intention to do so. Notice shall be served at least three (3) full months prior to the effective date of the Member's Retirement, unless the Company shall expressly consent to an earlier date by the affirmative vote of not less than fifty-one percent of the remaining Membership Percentages (excluding the retiring Member). The effective date of a Retirement shall in every case be the last day of a calendar month. The Company shall pay the retiring Member's monthly distribution through the effective date of the Retirement, pro rated for any partial month, for each month after he or she shall give notice, so long as he or she continues to devote his or her time diligently and faithfully to the business of the Company (pursuant to Section 7.07 below) until the Retirement becomes effective. In the case where a Member's Retirement from the Company is other than the last day of a calendar month, the Member shall receive a pro rata portion of what would have been the Member's distribution for that month, and an allocation of income and loss pursuant to Section 5.01 hereof, determined by dividing the number of business days in the month during which the Member continued as a Member in the Company by the total number of business days in the month. Notwithstanding any matter contained in this Section 6.01, the other Member(s) shall have the right and authority to make any Retirement effective earlier than the aforesaid effective date, to the extent deemed to be in the best interests of the Company by a vote of at least fifty- one percent of the remaining Membership Percentages (excluding the retiring Member). (b) The terms and conditions of Section 6.05 shall apply to the Membership Interest of the retired Member. (c) If a Member retires from the Company, all interest of the retiring Member in the Company, and its property and assets of any nature whatsoever, including goodwill, shall be terminated as of the Separation Date and such interest shall be liquidated with the sole consideration therefor being payment of the Highest Possible Payout Rate paid on a monthly 9 basis over the applicable number of months. Payments to the retiring Member are intended to represent payments for a Member's interest under Section 736(b) of the Code for the retiring Member's interest in the Company's property, including goodwill and other intangibles of the Company. If the retiring Member engages in Restricted Activities during the Restricted Period, the retiring Member's sole consideration shall be 25% of the Highest Possible Payout Rate paid on a monthly basis with any previous amounts overpaid being returned or offset against future payments. Additionally, the retiring Member shall pay to the Company 40% of any gross revenue that the retiring Member, or those acting on behalf of or in conjunction with the retiring Member, earn (regardless of when actually paid to the retiring Member) by engaging in Restricted Activities. In the event that a former Member dies while receiving payments under his Retirement, such payments shall be made to such former Member's personal representatives. (d) The Members further acknowledge and agree that it is and shall be their intention that the terms and conditions of this Section 6.01 shall comply with all rules and requirements applicable to the practice of law (including, without limitation intended, Rule 5.6 of the Pennsylvania Rules of Professional Conduct). If any term or provision of this Section 6.01 or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Section 6.01 or the application of any such term or provision to persons or circumstances, other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Section 6.01 shall be valid and enforceable to the fullest extent permitted by law. 6.02 Expulsion from Company. (a) A Member may be expelled from the Company at any time ("Expulsion" upon the occurrence of one or more of the following events ("Cause"): (i) The Member makes an assignment, in part or in whole, of the Shareholder's shares for the benefit of creditors; (ii) The Member files a voluntary petition of bankruptcy or consents to the filing of a petition for involuntary bankruptcy; (iii) The Member is adjudged bankrupt or insolvent or there is entered against the Member an order for relief in any bankruptcy or insolvency proceeding; (iv) The Member seeks, consents to, or acquiesces in the appointment of a trustee for, receiver for, or liquidation of any substantial part of the Member's properties; (v) The Member files an answer or other pleading admitting or failing to contest in a timely fashion the material allegations of a petition filed against the Member in any proceeding described in Subsections (i) through (iv); (vi) Any proceeding against the Member seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any statute, law, or regulation continues for one hundred twenty (120) days after the commencement 10 thereof, or the appointment of a trustee, receiver, or liquidator for the Member or all or any substantial part of the Member's properties without the Member's agreement or acquiescence, which appointment is not vacated or stayed for one hundred twenty (120) days or, if the appointment is stayed, for one hundred twenty (120) days after the expiration of the stay during which period the appointment is not vacated; (vii) The revocation or suspension of the Member's license to practice law in the Commonwealth of Pennsylvania, or any sanctions being entered against the Member by any regulatory authority due to misconduct by the Member in the practice of law; (viii) A Member's failure to comply with the terms and conditions of this Agreement, including (without limitation intended) Section 7.07 below; or (ix) The occurrence of any event (other than death) pursuant to which the Member's Membership Interest is to be transferred to the spouse of such Member by operation of law, including, without limitation intended, community property laws or divorce laws, but only if such Member does not obtain from his spouse a binding, written release of any and all rights such spouse may have in or to the Membership Interests, which is reasonably satisfactory to the other Member, within sixty (60) days after notice requesting such release. The Members each agree to notify each other within thirty (30) days of any change in residence or the commencement of any divorce or similar proceedings or any spousal separation for more than thirty (30) days. (b) Any dispute regarding the existence of Cause shall be decided pursuant to Section 6.07 below. (c) The Company shall pay an expelled Member's monthly distribution for the month during which he or she is expelled, pro rated for any partial month in which the Member is expelled, but otherwise the expelled Member shall not be entitled to any distributions from the Company. In the case where a Member's Expulsion from the Company is other than the last day of a calendar month, the Member shall receive an allocation of income and loss pursuant to Section 5.01 hereof, determined by dividing the number of business days in the month during which the Member continued as a Member in the Company by the total number of business days in the month. (d) If a Member is expelled from the Company, all interest of the withdrawing Member in the Company, and its property and assets of any nature whatsoever, including goodwill, shall be terminated as of the effective date of his or her expulsion and such interest shall be liquidated and forfeited. If, the expelled Member engages in Restricted Activities during the Restricted Period, he or she shall pay to the Company 40% of any gross revenue that the expelled Member, or those acting on behalf of or in conjunction with the expelled Member, earn (regardless of when actually paid to the expulsed Member) by engaging in Restricted Activities. (e) The Members further acknowledge and agree that it is and shall be their intention that the terms and conditions of this Section 6.02 shall comply with all rules and requirements applicable to the practice of law (including, without limitation intended, Rule 5.6 of the Pennsylvania Rules of Professional Conduct). If any term or provision of this Section 6.02 or 11 the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Section 6.02 or the application of any such term or provision to persons or circumstances, other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Section 6.02 shall be valid and enforceable to the fullest extent permitted by law. (f) The terms and conditions of Section 6.05 shall apply to the Membership Interest of the expelled Member. Upon the Expulsion of a Member, such Member shall automatically and without further action be deemed to have surrendered his entire ownership interest in the Company to the Company. 6.03 Disability. (a) In the event a Member fails to provide full-time services for four (4) weeks during any 8 -week period: (i) The Member shall be entitled to a full monthly distribution for the month prior the month in which the Member did not provide full-time services (the "Target Month"). (ii) The Company shall use best efforts to engage one or more persons to provide replacement services (to the extent such replacement services are needed), in which case the Member who failed to provide the services shall be entitled to continue to receive monthly distributions for six (6) months after the Target Month as the Member's monthly draw; provided, however, that such Member's distribution in each case shall be reduced, dollar -for - dollar, by all additional costs and expenses incurred by the Company in obtaining the replacement services. (iii) At the end of the foregoing 6 -month period, if the Member has not returned to work and provided full-time services during the month immediately preceding the expiration of the 6 -month period, the Member shall be deemed to have suffered a Disability effective as of the expiration of the 6 -month period. (b) The Members acknowledge that the terms and conditions of this Section 6.03 are fair and reasonable, in light of the fact that each Member has heretofore obtained an individual disability policy for his own protection. It shall be the responsibility of each Member to maintain each such policy in place, as by timely paying all necessary premiums. (c) The terms and conditions of Section 6.05 shall apply to the Membership Interest of a Member who has suffered a Disability. A Member who has suffered a Disability shall be treated as if the Member selected Retirement under Section 6.01 and the provisions of Section 6.01(c), and (d) shall govern. 6.04 Death. (a) In the event a Member dies while a Member during the term of this Agreement, the Member's estate shall be entitled to a full monthly distribution for the month during which the date of death occurs. In the case where a Member's death is other than the last 12 day of a calendar month, the Member shall receive an allocation of income and loss pursuant to Section 5.01 hereof, determined by dividing the number of business days in the month during which the Member continued as a Member in the Company by the total number of business days in the month. (b) It is understood and agreed that the Member (and/or his estate) shall not be entitled to receive any proceeds from any life insurance policy or policies on the deceased Member's life, the Company having obtained such policy(ies) as "keyman" policies, to compensate the Company for the loss of services suffered as a result of a Member's death. (c) The terms and conditions of Section 6.05 shall apply to the Membership Interest of a Member who has died during the term of this Agreement. 6.05 Other Terms and Conditions. (a) It is expressly understood and agreed that, pursuant to Section 8971(a)(4) of the Act, a Member's Retirement, Expulsion, Disability or death shall not cause the dissolution of the Company, and the Company shall have the right to continue under its present name, and to utilize the name of the Separating Member (as defined in Section 6.05(b) below), except as otherwise provided by applicable law. (b) Except as otherwise provided in this Agreement, all interest of any Member who retires, is expelled, suffers a Disability, or dies (the "Separating Member"), in the Company and its property and assets of any nature whatsoever, including goodwill, shall be terminated as of the effective date of his or her Retirement, Expulsion, Disability, or death. The Separating Member hereby agrees that he or she shall not have the right to receive any amounts pursuant to Section 8933 of the Act. (c) The liability of any Separating Member for any act or thing which shall occur on or before the effective date of his or her Retirement, Expulsion, Disability, or death shall not he affected by his or her Retirement, Expulsion, Disability, or death. (d) Each Separating Member (or his or her estate, as applicable) covenants that he or she will fully cooperate in good faith in making an orderly transfer to the remaining Members of all pending matters pertaining to the affairs of those clients whose business he or she has carried on or supervised, unless any such client shall expressly elect to continue to be represented by a Separating Member. If any client shall elect to continue to be represented by a Separating Member, and the Separating Member shall elect to continue to represent the client, the Separating Member shall be entitled to receive all papers and work -in -progress pertaining to the affairs of the client upon payment to the Company of an amount equal to all unpaid bills charged against the client plus the value of all unbilled work -in -progress which has been performed for the client to the effective date of the separation (the value to be computed at the then prevailing rate generally charged for such services) and all unbilled disbursements to such date. Upon payment of said amount, the Separating Member shall be entitled to all fees thereafter collected from the client subject to Section 3.07(c) or 6.02(d), and the Company shall assign its rights to the Separating Member. The Company shall be authorized to set off any 13 payments due the Separating Member against any other amount(s) which the Company is entitled from the Separating Member. 6.06 Purchase of Membership Interests at Death. (a) The Membership Interest of a deceased Member shall be subject to an obligation on the part of the Company to purchase such Membership Interest, and the purchase price for the Membership Interest of a deceased Member in liquidation of such deceased Member's interest in the Company shall be an amount equal to $5,000,000. Payments to the deceased Member are intended to represent payments for a Member's interest under Section 736(b) of the Code for the deceased Member's interest in the Company's property, including goodwill and other intangibles of the Company. (b) The purchase price for the Membership Interest of a deceased Member shall be paid as follows: (i) at closing, the Company shall make a payment in cash equal to one-third (1/3) of the purchase price; (ii) at closing, the Company shall deliver a 2 -year promissory note providing for two equal annual installments of the balance of the purchase price, with interest payable annually at the Applicable Federal Rate in effect on the date that the promissory note is issued, determined in accordance with Section 1274(d) (or any successor provision) of the Code. In the event of default of payment for a period of ten (10) days, the remainder of the principal and accrued interest then unpaid under the promissory note shall become due and payable at once. The maker of any promissory note delivered hereunder shall have the right to prepay the principal amount due on such note at any time without a prepayment penalty; (iii) If the Company owns any insurance policy(s) on the life of a deceased Member and if the Company is purchasing such deceased Member's interest in the Company, then an amount equal to the insurance proceeds received by the Company shall be paid to the estate or personal representative of the deceased Member at the closing of the transfer of his interest in the Company, but not in excess of the purchase price as determined in accordance with this Section 6.06. Any such insurance proceeds represent the property of the Company and references herein to any such insurance proceeds are merely to measure amounts to be paid to the estate or personal representative of a deceased Member at a closing. The insurance proceeds shall reduce the purchase price determined under Section 6.06(a) above and shall represent all or part of the payment due at closing under Section 6.06(b)(i) and, if the insurance proceeds are in excess of the cash payment required, shall then be applied to reduce the promissory note to be delivered under Section 6.06(b)(ii); and (iv) Notwithstanding the other limitations and restrictions of this Agreement, as long as the promissory note, if any, described in this Section 6.06(b) is outstanding, the Company shall not, without the prior written consent of the holder of the promissory note, make any extraordinary distributions to any Member, incur any debt or pledge 14 its assets as security for any debt (other than in the ordinary course of business), reorganize, merge or consolidate or dispose of any of its assets other than in the ordinary course of business. (c) Closing on all purchases hereunder shall take place within sixty (60) days after the date of determination of the purchase price and the receipt by the Company of any life insurance proceeds on the death of the deceased Member, if any, at such time and place as the parties shall agree. At the closing, the Company shall deliver to the deceased Member's personal representative the purchase price in accordance with this Section 6.06, and the deceased Member's personal representative shall execute and deliver to the Company such assignments, instruments of conveyances and other documents and instruments as the Company shall reasonably request to effectively convey title to the deceased Member's Membership Interest. In addition, the Company, at closing, shall, to the extent reasonably practicable, obtain and deliver the unconditional release, in form reasonably satisfactory to the deceased Member's personal representative, of the deceased Member of and from any personal guarantees made by the deceased Member, if any, with respect to indebtedness or liabilities of the Company. Each party shall pay his, her, or its own attorneys fees. 6.07 Mediation. (a) Any and all disputes or claims arising out of or relating to the validity, interpretation, enforceability or performance of this Agreement, the existence of Cause, and/or any deadlock of the Members (including, without limitation intended, any action or proposed action with respect to a Member), shall first be submitted to mediation for resolution as a condition prerequisite to any action to enforce, or for a breach of, this Agreement. Subject to his availability, the parties agree to employ the services of Gregory A. Miller, Esquire, of Buchanan Ingersoll & Rooney, PC or his designee, as the mediator. The Members agree that each must pursue mediation within ten (10) business days after the date on which the dispute arose, and that the mediation shall take place in Pittsburgh, Pennsylvania. This Section 6.07 shall not apply to violations of the non -competition provisions of this Agreement and violations of Section 3.05(1)) above. (b) hi the event the Members cannot resolve any dispute through mediation within ten (10) business days after commencement of mediation, then any Member shall have available all remedies at law or in equity (including the right to bring an action for declaratory judgment), with jurisdiction and venue to be in accordance with Section 12.07 below. 6.08 Adverse Business Operations. (a) In any case where the Company is making payments (or obligated to make payments) to a former member of the Company (or such person's estate or heirs) under Section 3.07(c) (voluntary withdrawal), Section 6.01(c) (retirement), Section 6.03 (c)(disability), or Section 6.06(a) (death), and if the Company's billables/receivables for any quarter do not exceed that quarter's expenses by 20%, then Gregory A. Miller, Esquire of Buchanan Ingersoll & Rooney, PC or his designee, shall have the right to immediate access of all Company records for his review and shall have management authority over all Company personnel in the course of their carrying out their duties for the Company. 15 (b) Mr. Miller, or his designee, shall be permitted to act in accordance with Section 6.08 hereof until such time as the Company's billables/receivables for any quarter exceed that quarter's expenses by 20%. ARTICLE VII MANAGEMENT 7.01 Management. The powers of the Company shall be exercised by and under the authority of, and the business and affairs of the Company shall be managed by the Members, who shall make all decisions and take all actions for the Company not otherwise provided for in this Agreement upon the affirmative vote of a Super Majority Interest of the Members, including, but not limited to, the following: (a) acquire by purchase, lease or otherwise any real or personal property which may be necessary, convenient, or incidental to the accomplishment of the purposes of the Company; (b) develop, operate, maintain, finance, improve, construct and own all real and personal property necessary, convenient, or incidental to the accomplishment of the purposes of the Company; (c) execute any and all agreements, contracts, documents, certificates, plans and instruments necessary or convenient in connection with managing the affairs of the Company; (d) execute, in furtherance of any or all of the purposes of the Company, any deed, lease, mortgage, deed of trust, mortgage note, promissory note, bill of sale, contract, security agreement, financing statement, assignments or other instrument purporting to convey or encumber any or all of the Company property; (e) prepay in whole or in part, refinance, recast, increase, modify or extend any liability affecting the Company property and in connection therewith execute any extensions or renewals of encumbrances on any or all of the Company property; (f) contract on behalf of the Company for the employment and services of employees and/or independent contractors, such as attorneys and accountants; (g) engage in any kind of activity and perform and carry out contracts of any kind (including contracts of insurance covering risks to Company property) necessary or incidental to, or in connection with, the accomplishment of the purposes of the Company, as may be lawfully carried on or performed by the Company under the laws of Pennsylvania; (h) take, or refrain from taking, all actions, not expressly prescribed or limited by this Agreement, as may be necessary or appropriate to accomplish the purposes of the Company; (i) institute, prosecute, defend, settle, compromise and dismiss lawsuits or other judicial or administrative proceedings brought on or in behalf of, or against, the Company 16 or the Members in connection with activities arising out of, connected with, or incidental to this Agreement, and to engage counsel or others in connection therewith; and (j) do all other acts and things permitted by law and not otherwise prohibited by this Agreement or the Act. 7.02 Meetings. (a) A quorum shall be present at a meeting of Members if the holders of a Majority Interest are represented at the meeting in person or by proxy. With respect to any matter and except as otherwise provided in this Agreement, the affirmative vote of a Majority Interest at a meeting of Members at which a quorum is present shall be the act of the Members. (b) All meetings of the Members shall be held at the principal place of business of the Company or at such other place within or without the Commonwealth of Pennsylvania as shall be specified or fixed in the notices or waivers of notice thereof; provided that any or all Members may participate in any such meeting by means of conference telephone or similar communications equipment pursuant to Section 7.06. (c) The chairman of the meeting or the holders of a Majority Interest shall have the power to adjourn such meeting from time to time, without any notice other than announcement at the meeting of the time and place of the holding of the adjourned meeting. If such meeting is adjourned by the Members, such time and place shall be determined by a vote of the holders of a Majority Interest. Upon the resumption of such adjourned meeting, any business may be transacted that might have been transacted at the meeting as originally called. (d) An annual meeting of the Members for the transaction of business as may properly come before the meeting, shall be held at such place, within or without the Commonwealth of Pennsylvania, on such date and at such time as the Members shall fix and set forth in the notice of the meeting. Failure to hold an annual meeting does not invalidate the Company's existence or affect any otherwise valid acts by the Members. (e) Special meetings of the Members for any proper purpose or purposes may be called at any time by the Members or the holders of at least thirty percent (30%) of the Membership Percentages of all Members. If not otherwise stated in or fixed in accordance with the remaining provisions hereof, the record date for determining Members entitled to call a special meeting is the date any Member first signs the notice of such meeting. Only business within the purpose or purposes described in the notice (or waiver thereof) required by this Agreement may be conducted at a special meeting of the Members. (f) Written or printed notice stating the place, day and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than 10 nor more than 60 Business Days before the date of the meeting, either personally by mail, by or at the direction of the Members or person calling the meeting, to each Member entitled to vote at such meeting. If mailed, any such notice shall be deemed to be delivered when deposited in the United States mail, addressed to the Member at such Member's address provided for in Section 12.02, with postage thereon prepaid. 17 (g) The date on which notice of a meeting of Members is mailed or the date on which the resolution of the Members declaring a distribution is adopted, as the case may be, shall be the record date for the determination of the Members entitled to notice of or vote at such meeting, including any adjournment thereof, or the Members entitled to receive such distribution. 7.03 Voting List. The Members shall make available, at least 10 Business Days before each meeting, a complete list of the Members entitled to vote at such meeting or any adjournment thereof, arranged in alphabetical order, with the address of and the Membership Interest held by each, which list, for a period of ten days prior to such meeting, shall be kept on file at the registered office or principal place of business of the Company and shall be subject to inspection by any Member at any time during usual business hours. Such list shall also be produced and kept open at the time and place of the meeting and shall be subject to the inspection of any Member during the whole time of the meeting. At all times such list shall be kept confidential by the Members. The original membership records shall be prima-facie evidence as to who are the Members entitled to examine such list or transfer records or to vote at any meeting of Members. Failure to comply with the requirements of this Section shall not affect the validity of any action taken at the meeting. 7.04 Proxies. A Member may vote either in person or by proxy executed in writing by the Member. A telegram, telex, cablegram, fax, electronic e-mail or similar transmission by the Member, or a photographic, photostatic, facsimile or similar reproduction of a writing executed by the Member shall be treated as an execution in writing for purposes of this Section. A proxy shall be revocable unless the proxy form conspicuously states that the proxy is irrevocable. 7.05 Conduct of Meeting. All meetings of the Members shall be presided over by the chairman of the meeting, who shall be elected by a Majority Interest of the Members. The chairman of any meeting of Members shall determine the order of business and the procedure at the meeting, including such regulation of the manner of voting and the conduct of discussion as seem to him in order. 7.06 Action By Written Motion or Telephone Conference. (a) Any action required or permitted to be taken at any annual or special meeting of Members may be taken without a meeting, without prior notice, and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holder or holders of not less than the minimum Membership Percentages that would be necessary to take such action at a meeting at which the holders of all Membership Interest entitled to vote on the action were present and voted. (b) The record date for determining Members entitled to consent to action in writing without a meeting shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Company by delivery to its registered office, its principal place of business, or the Members. Delivery shall be by hand or by certified or registered mail, return receipt requested. 18 (c) If any action by Members is taken by written consent, any articles or documents filed with the Secretary of the Commonwealth of Pennsylvania as a result of the taking of the action shall state, in lieu of any statement required by the Act concerning any vote of Members, that written consent has been given in accordance with the provisions of the Act and that any written notice required by the Act has been given. (d) Members may participate in and hold a meeting by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in such meeting shall constitute attendance and presence in person at such meeting, except where a person participates in the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened. 7.07 Full -Time Efforts. (a) Each Member shall devote his or her full time to the business of the Company and shall not engage in any other business or profession without the consent of the Company. Without limiting the foregoing, each Member shall make a good faith effort to participate in, and shall participate, in the operation and management of the Company. (b) No Member shall undertake any professional matter for compensation or accept any employment for compensation except for the benefit of the Company. A Member shall have the right to carry on individual investment activities, and/or to engage in community or similar activities so long as they do not interfere with his or her ability to carry out his or her duties as a Member. (c) Each Member shall practice law competently, shall comply with the provisions of the Pennsylvania Rules of Professional Conduct (or such other rules as may be applicable in those other jurisdictions where the Member practices law), shall discharge requirements of Continuing Legal Education, and shall file all federal, state and local tax returns in a timely fashion. ARTICLE VIII INDEMNIFICATION Subject to any limitations in the Act, the Company shall indemnify and defend and hold harmless each Member from and against any and all loss, cost, expense, damage or liability, including but not limited to reasonable attorneys' fees, arising out of or resulting from, in whole or in part, any action or inaction or omission, including but not limited to sole or partial negligence or breach of contract or breach of any duty or other conduct, by same within the scope of authority conferred by this Agreement and taken in good faith, except for acts or omissions constituting willful misconduct or recklessness. Recourse pursuant to the indemnification provided under this Article VIII shall be limited to the assets of the Company and no Individual Member shall be liable for any deficiency in such indemnification, however arising. 19 ARTICLE IX TAXES 9.01 Tax Returns. The Members shall cause to be prepared and filed all necessary federal and state income tax returns for the Company, including making the elections described in Section 9.02. Each Member shall furnish all pertinent information in its possession relating to Company operations that is necessary to enable the Company's income tax returns to be prepared and filed. 9.02 Tax Elections. To the extent permitted by applicable tax law, the Company shall have the discretion to make the following elections on the appropriate tax returns: (a) to adopt the calendar year as the Company's fiscal year; (b) to adopt the cash method of tax accounting; (c) if a transfer of a Membership Interest, to the extent permitted by this Agreement, as described in Section 743 of the Code occurs, on written request of any transferee Member, or if a distribution of Company property is made on which gain described in Section 734(b)(1)(A) of the Code is recognized or there is an excess of adjusted basis as described in Section 734(b)(1)(B) of the Code, to elect, pursuant to Section 754 of the Code, to adjust the basis of Company properties. (d) to elect to amortize the organizational expenses of the Company and the start-up expenditures of the Company ratably over a period of 60 months as permitted by Sections 195 and 709(b) of the Code; and (e) any other election the Members may deem appropriate and in the best interests of the Members. Neither the Company nor any Member may make an election for the Company to be excluded from the application of the provisions of subchapter K of chapter 1 of subtitle A of the Code or any similar provisions of applicable state law, and no provision of this Agreement shall be construed to sanction or approve such an election. 9.03 Tax Matters Partner. A Majority Interest of the Members shall designate one Member to be the "tax matters partner" of the Company pursuant to Section 6231(a)(7) of the Code. Any Member who is designated "tax matters partner" shall take such action as may he necessary to cause each other Member to become a "notice partner" within the meaning of Section 6223 of the Code. Any Member who is designated "tax matters partner" shall inform each other Member of all significant matters that may come to its attention in its capacity as "tax matters partner" by giving notice thereof on or before the fifth Business Day after becoming aware thereof and, within that time, shall forward to each other Member copies of all significant written communications it may receive in that capacity. Any Member who is designated "tax matters partner" may not take any legal position in relation to the proceedings contemplated by Sections 6221 through 6234 of the Code without the consent of a Majority Interest. 9.04 Section 409A. Notwithstanding any provision of this Agreement to the contrary, if any benefit provided under this Agreement is subject to the provisions of Section 409A of the Code and the regulations issued thereunder, the provisions of the Agreement shall be 20 administered, interpreted and construed in a manner necessary in order to comply with Section 409A and the regulations issued thereunder, or an exception thereto (or disregarded to the extent such provision cannot be so administered, interpreted or construed), and the following provisions shall apply, as applicable: (a) The benefits provided under this Agreement shall be granted under terms and conditions consistent with Treas. Reg. § 1.409A -1(b)(5) such that any such benefits do not constitute a deferral of compensation under Section 409A. Accordingly, any such benefits may be granted to eligible partners, members, managers and consultants of the Company. (b) For purposes of Section 409A, and to the extent applicable to any benefit under this Agreement, it is intended that distribution events qualify as permissible distribution events for purposes of Section 409A and shall be interpreted and construed accordingly. Whether a recipient has separated from service or employment will be determined by the Members based on all of the facts and circumstances and, to the extent applicable to any benefit, in accordance with the guidance issued under Section 409A. For this purpose, separation from service shall mean the recipient's death, retirement or other termination of service with the Company and all of its controlled group members within the meaning of Section 409A of the Code; provided, that, a recipient will be presumed to have experienced a separation from service when the level of bona fide services performed permanently decreases to a level less than twenty percent (20%) of the average level of bona fide services performed during the immediately preceding thirty-six (36) month period or such other applicable period as provided by Section 409A. The Company is relying on Q&A 7 in Notice 2005-1 issued by the Internal Revenue Service as well as the Final Regulations issued pursuant to Section 409A on April 10, 2007 located at 72 FR 19234 for guidance indicating that benefits provided to partners of a federal tax partnership who have their ownership interests liquidated are not payments subject to Section 409A. (c) If a recipient is a "specified employee" for purposes of Section 409A and a payment subject to Section 409A (and not excepted therefrom) to the recipient is due upon separation from service, such payment shall be delayed for a period of six (6) months after the date the recipient separates from service (or, if earlier, the death of the recipient). Any payment that would otherwise have been due or owing during such six-month period will be paid immediately following the end of the six-month period unless another compliant date is specified in the applicable agreement. (d) In no event shall the Company (or its employees, partners, members, officers, or directors or affiliates) have any liability to any recipient (or any other Person) due to the failure of any benefit to satisfy the requirements of Section 409A. ARTICLE X BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS 10.01 Maintenance of Books. The Company shall keep books and records of accounts and shall keep minutes of the proceedings of its Members and each committee of the Members (if any). The calendar year shall be the accounting year of the Company. 21 10.02 Reports. On or before the 75th day following the end of each fiscal year during the term of the Company, each Member shall be furnished with a balance sheet, an income statement, and a statement of changes in Members' capital of the Company for, or as of the end of, that year prepared by a certified public accountant. These financial statements must be prepared in accordance with accounting principles generally employed for cash basis records consistently applied (except as therein noted). The Members also may cause to be prepared or delivered such other reports as they may deem appropriate. The Company shall bear the costs of all of these reports. 10.03 Accounts. The Members shall establish and maintain one or more separate bank and investment accounts and an-angements for Company funds in the Company name with financial institutions and firms that the Members determine. The Members may not commingle the Company's funds with the funds of any Member; provided, however Company funds may be invested in a manner the same as or similar to the Members' investment of their own funds. ARTICLE XI DISSOLUTION, LIQUIDATION, AND TERMINATION 11.01 Dissolution. The Company shall dissolve and its affairs shall be wound up on the first to occur of the following: (a) the written consent of all of the Members; or (b) entry of a decree of judicial dissolution of the Company under the Act. It is expressly understood and agreed that, pursuant to Section 8971(a)(4) of the Act, the following events shall not cause the dissolution of the Company: (i) a Member's becoming bankrupt or executing an assignment for the benefit of creditors; (ii) the death, retirement, resignation, expulsion or dissolution of a Member; or (iii) any other event that terminates the continued membership of a Member. 11.02 Liquidation and Termination. On dissolution of the Company, one or more Members shall act as liquidator(s) as appointed by a Majority Interest of the Members. The liquidator shall proceed diligently to wind up the affairs of the Company and make final distributions as provided herein and in the Act. The costs of liquidation shall be borne as a Company expense. Until final distribution, the liquidator(s) shall continue to operate the Company properties with all of the power and authority of the Members. The steps to be accomplished by the liquidator are as follows: (a) as promptly as possible after dissolution and again after final liquidation, the liquidator(s) shall cause a proper accounting to be made by a recognized firm of certified public accountants of the Company's assets, liabilities, and operations through the last day of the calendar month in which the dissolution occurs or the final liquidation is completed, as applicable; (b) the liquidator(s) shall pay, satisfy or discharge from Company funds all of the debts, liabilities and obligations of the Company (including, without limitation, all expenses incurred in liquidation and any advances described in Section 4.04) or otherwise make adequate 22 provision for payment and discharge thereof (including, without limitation, the establishment of a cash escrow fund for contingent liabilities in such amount and for such term as the liquidator(s) may reasonably determine), all in accordance with Section 8974 of the Act and such other provisions of the Act as may be applicable; and (c) all remaining assets of the Company shall be distributed to the Members as follows: (i) the liquidator(s) may sell any or all Company property, including to Members, and any resulting gain or loss from each sale shall be computed and allocated to the capital accounts of the Members; (ii) with respect to all Company property that has not been sold, the fair market value of that property shall be determined and the capital accounts of the Members shall be adjusted to reflect the manner in which the unrealized income, gain, loss, and deduction inherent in property that has not been reflected in the capital accounts previously would be allocated among the Members if there were a taxable disposition of that property for the fair market value of that property on the date of distribution; and (iii) Company property shall be distributed among the Members in accordance with the positive capital account balances of the Members, as determined after taking into account all capital account adjustments for the taxable year of the Company during which the liquidation of the partnership occurs (other than those made by reason of this clause (iii)); and those distributions shall be made by the end of the taxable year of the Company during which the liquidation of the Company occurs (or, if later, 90 days after the date of the liquidation). All distributions in kind to the Members shall be made subject to the liabilities of each Member receiving a distribution for any costs, expenses, and liabilities theretofore incurred or for which the Company has committed prior to the date of termination and those costs, expenses, and liabilities shall be allocated to the distributees pursuant to this Section 11.02. The distribution of cash and/or property to a Member in accordance with the provisions of this Section 11.02 constitutes a complete return to the Member of its Capital Contributions and a complete distribution to the Member of its Membership Interest and all the Company's property. 11.03 Deficit Capital Accounts. Notwithstanding anything to the contrary contained in this Agreement, and notwithstanding any custom or rule of law to the contrary, to the extent that the deficit, if any, in the capital account of any Member results from or is attributable to deductions and losses of the Company (including non-cash items such as depreciation), or distributions of money pursuant to this Agreement to all Members in proportion to their respective Membership Interest, upon dissolution of the Company such deficit shall not be an asset of the Company and such Members shall not be obligated to contribute such amount to the Company to bring the balance of such Members capital account to zero. 11.04 Certificate of Dissolution. On completion of the distribution of Company assets as provided herein, the Company is terminated, and the Members (or such other person or persons as the Act may require or permit) shall file a Certificate of Dissolution with the 23 Pennsylvania Department of State, cancel any other filings made pursuant to Section 2.05, and take such other actions as may be necessary to terminate the Company ARTICLE XII GENERAL PROVISIONS 12.01 Offset. Whenever the Company is to pay any sum to any Member, whether as an allocation, distribution or otherwise, then any amounts that the recipient Member owes the Company at the time such sum is to be paid may be deducted from that sum before payment is made. 12.02 Notices. Except as expressly set forth to the contrary in this Agreement, all notices, requests, or consents provided for or permitted to be given under this Agreement must be in writing and must be given either by depositing that writing in the United States mail, addressed to the recipient, postage paid, and registered or certified with return receipt requested or by delivering that writing to the recipient in person, by courier, or by facsimile transmission; and a notice, request, or consent given under this Agreement is effective on receipt by the person to receive it. A11 notices, requests, and consents to be sent to a Member must be sent to or made at the addresses given for that Member on Exhibit A, or such other address as that Member may specify by notice to the other Members. Whenever any notice is required to be given by law, the Certificate or this Agreement, a written waiver thereof, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. 12.03 Entire Agreement. This Agreement constitutes the entire agreement of the Members relating to the Company and supersedes all prior contracts or agreements with respect to the Company, whether oral or written, including (without limitation intended) the Initial Agreement. 12.04 Effect of Waiver or Consent. A waiver or consent, express or implied, to or of any breach or default by any person in the performance by that person of its obligations with respect to the Company is not a consent or waiver to or of any other breach or default in the performance by that person of the same or any other obligations of that person with respect to the Company. Failure on the part of a person to complain of any act of any person or to declare any person in default with respect to the Company, irrespective of how long that failure continues, does not constitute a waiver by that person of its rights with respect to that default until the applicable statute -of -limitations period has run. 12.05 Amendment or Modification. This Agreement may be amended or modified from time to time only by a written instrument adopted, executed and agreed to by an affirmative vote of a Super Majority Interest of the Members. 12.06 Binding Act. Subject to the terms and conditions of this Agreement, this Agreement is binding on and inures to the benefit of the Members and their respective heirs, successors, and personal representatives. 24 12.07 Jurisdiction and Venue. Subject to Section 6.07 above, the parties agree that proper jurisdiction and venue for resolution of any and all disputes hereunder shall only be in the Court of Common Pleas for Dauphin County, Pennsylvania. 12.08 Governing Law; Severabilitv. This Agreement is governed by and shall be construed in accordance with the laws of the Commonwealth of Pennsylvania, excluding any conflict of laws role or principle that might refer the governance or the construction of this Agreement to the law of another jurisdiction. If any provision of this Agreement or the application thereof to any person or circumstance is held invalid or unenforceable to any extent, the remainder of this Agreement and the application of that provision to other persons or circumstances is not affected thereby and that provision shall be enforced to the greatest extent permitted by law. 12.09 Further Assurances. In connection with this Agreement and the transactions contemplated hereby, each Member shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriate to effectuate and perform the provisions of this Agreement and those transactions. 12.10 No Third Party Benefit. The provisions hereof are solely for the benefit of the Company and its Members and are not intended to, and shall not be construed to, confer a right or benefit on any creditor of the Company or any other person. 12.11 Waiver of Certain Rights. Each Member irrevocably waives any right it may have to maintain any action for dissolution of the Company or for partition of the property of the Company. 12.12 Counterparts. This Agreement may be executed in any number of counterparts with the same effect as if all signing parties had signed the same document. A11 counterparts shall be construed together and constitute the same instrument. [SIGNATURES APPEAR ON FOLLOWING PAGE] 25 IN WITNESS WHEREOF, the undersigned, being all of the Members of the Company, have executed this Amended and Restated Operating Agreement as of the date first set forth above. WITNESS: WITNESS: Chadwick 0. Bogar 26 (SEAL) (SEAL) Limited Liability Company Amended and Restated Operating Agreement Schutjer Bogar LLC Exhibit "A" y� List of Members, Capital, Percentages, etc., as of August , 2010 Initial Membership Name of Member Contribution Percentage Chadwick O. Bogar $ ‘o.occ) 50.00% Bradley A. Schutjer $ Do C.) 50.00% #5192688-v7.FoRSYTH I 27 100.00% 4 AGREEMENT THIS AGREEMENT is made this H of May 2013, by and between Chadwick O. Bogar ("Chad") and Bradley A. Schutjer ("Brad")(together, "Members"). WITNESSETH WHEREAS, Members are parties to a Second Amended and Restated Operating Agreement Schutjer Bogar LLC ("Operating Agreement"); and WHEREAS, the Operating Agreement contains terms to address the departure of Members from Schutjer Bogar LLC including what, if any, pay -out the departing Member will receive; and WHEREAS, Members have reviewed and are familiar with the terms of the Operating Agreement and are both represented by counsel; and WHEREAS, by signing below, Members confirm that they are voluntarily, willingly and knowingly agreeing to modify and/or amend the Operating Agreement as specifically set forth below. Other than those specific changes set forth below, the Operating Agreement shall remain in full force and effect. NOW THEREFORE, the parties intending to be legally bound, agree as follows: 1. The parties agree that it is in the best interest of Schutjer Bogar, LLC (the "firm") that Brad assign his membership interest to Chad and/or the firrn in exchange for payment of Brad's membership interest. Brad's membership interest shall be acquired by Chad and/or the firm at the price set forth below. The terms of section 6.01 of the Operating Agreement (except as modified herein) shall govern even though Brad is not certain whether he is "retiring" from the practice of law. Brad shall not, directly or indirectly, conduct any Restricted Activity (as defined in the Operating Agreement) at any time during the entire time any payments are due hereunder (Members intend the Restricted Period (as defined in the Operating Agreement) to be extended for the entire time payments are due hereunder). Consistent with section 6.01, should Brad conduct such Restricted Activities during the extended Restricted Period, he shall forfeit (pro rata) 75% of the payments set forth below in Section 3 with any previous amounts overpaid being returned or offset against future payments and shall also pay to Chad 40% of any gross revenues received by engaging in Restricted Activities as more specifically set forth in section 6.01(c) of the Operating Agreement. The parties agree to waive any required notices as provided therein and make Brad's assignment effective the day hereof. In exchange for the obligations set forth below, Brad will immediately relinquish and turn over to Schutjer Bogar LLC any and all ownership that he has in Schutjer Bogar LLC. 2. Brad represents and agrees by signing below that he has not been denied any leave or benefit requested, has received the appropriate pay for all hours worked for the Firm and has no known workplace injuries or occupational diseases. Brad affirms that he has not filed, nor has he caused to be filed, nor is he presently a party to any claim, complaint, or action against "EXHIBIT A" Releasees in any forum or form. Other than the consideration set forth herein, Brad further affirms that he has been paid and/or has received all leave (paid or unpaid), compensation, wages, bonuses and/or commissions to which he may be entitled and that no other leave (paid or unpaid), compensation, wages, bonuses and/or commissions are due to him, except as provided in this Agreement. 3. Section 6.01 of the Operating Agreement shall be amended to provide the following payout terms for the acquisition of Brad's interest, Schutjer Bogar LLC and/or Chad shall pay to Brad the following payments: a. $15,000 on the 15th of every month beginning on July 15, 2013 and continuing through June 15, 2017; and b. $20,000 on June 15, 2013; and c. $150,000 on July 15, 2017; and d. Brad elects to continue health coverage in accordance with the continuation requirements of COBRA, Chad shall pay the cost of said coverage for a period of twelve (12) months. 5. Schutjer Bogar LLC and/or Chad shall endeavor through good faith efforts with the Bankruptcy Trustee and the Bank to restructure the Firm debt to have Brad removed as a personal guarantor. Likewise, Chad and the firm will assume all outstanding debts, liabilities and contractual agreements of the firm, including a certain business loan of the firm to Metro Bank which has been personally guaranteed by Members. Chad and the firm hereby indemnify and hold Brad harmless for said obligations, including the obligation to Metro Bank. 6. Brad knowingly and voluntarily releases and forever discharges Chad and Schutjer Bogar LLC as well as his/its parent, affiliates, subsidiaries, divisions, predecessor companies, their successors and assigns, their affiliated and predecessor companies and the current and former employees, attorneys, shareholders, members, officers, directors and agents thereof and Chad knowingly and voluntarily releases and forever discharges Brad and Schutjer Bogar LLC as well as his/its parent, affiliates, subsidiaries, divisions, predecessor companies, their successors and assigns, their affiliated and predecessor companies and the current and former employees, attorneys, shareholders, members, officers, directors and agents thereof (collectively referred to throughout the remainder of this Agreement as "Releasees"), of and from any and all claims, demands, liabilities, obligations, promises, controversies, damages, rights, actions and causes of action, known and unknown, which Brad or Chad have or may have against Releasees as of the date of execution of this Agreement, examples include, but are not limited to, any alleged violation of: • Title VII of the Civil Rights Act of 1964, as amended; • The Civil Rights Act of 1991; • Sections 1981 through 1988 of Title 42 of the United States Code, as amended; 2 4 • The Employee Retirement Income Security Act of 1974, as amended; • The Immigration Reform and Control Act, as amended; • The Americans with Disabilities Act of 1990, as amended; • The Age Discrimination in Employment Act of 1967, as amended; • The Older Workers Benefit Protect Act; • The Workers Adjustment and Retraining Notification Act, as amended; • The Occupational Safety and Health Act, as amended; • The Equal Pay Act of 1963; • The Genetic Information Nondiscrimination Act; • The Family and Medical Leave Act; • Uniformed Services Employment and Reemployment Rights Act; • The Consolidated Omnibus Budget Reconciliation Act of 1985; • Any other federal, state or local civil or human rights law or any other local, state public policy, contract, tort, or common law; or • Any allegation for costs, fees, or other expenses including attorneys' fees incurred in these matters (all of the above collectively referred to as "Claims"). 7. This release is intended to be a general release, and excludes only those claims under any statute or common law that Members are legally barred from releasing. Members are advised to seek independent legal counsel if they seek clarification on the scope of this release. Signing this Agreement does not waive Members' right to seek a judicial determination of the validity of Members' release of rights arising under the Age Discrimination in Employment Act. 8. Nothing herein is intended to or shall preclude Members from filing a charge with any appropriate federal, state, or local government agency and/or cooperating with said agency in its investigation. Members, however, explicitly waive any right to file a personal lawsuit or receive monetary damages that the agency may recover against Releasees, without regard as to who brought any said complaint or charge, except for matters related to the enforcement of this agreement. 9. Should the firm be acquired, merged or should the assets of the firm be purchased by a third party entity, the buyout of Brad's interest in the firm as set forth herein shall remain an obligation of the acquiring or successor entity to the firm, and the obligations of Chad and the firm to Brad as set forth herein shall remain in full force and effect. Likewise, if Chad becomes employed by an entity which is separate from the firm, or if Chad is otherwise gainfully employed by or consults with an entity other than the firm in substantially the same practice area of the firm, Chad shall be personally liable to Brad for the buyout provisions of this agreement. 10. It is expressly stipulated that in the event that either party breaches any provision of this Agreement, he or she shall be responsible for any and all costs incurred to enforce the Agreement, including, but not limited to, court cost and counsel fees of the other party. In the event of breach, the other party shall have the right, at his or her election; to sue for damages for such breach or to seek such other and additional remedies as may be available to him or her. 3 11. The firm shall maintain life insurance on Chad with sufficient proceeds payable to Brad to ensure performance of this agreement. 12. Neither of the parties shall disparage one another with respect to matters relating to one another's conduct in connection with the operation of the firm and neither shall disclose the terms of this agreement to a third party except as required for bankruptcy Court approval, tax advice and preparation, insurance claims and any similar, related matter. Nothing herein shall restrict either Member's ability to truthfully respond to inquiries posed regarding matters related to this Agreement. Chadwick 0. Bogar 4 4 .• * IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA BRADLEY D. SCHUTJER, Plaintiff No. 2014-5044 v. CIVIL ACTION — LAW CHADWICK O. BOGAR and SCHUTJER BOGAR, LLC, Defendants JURY TRIAL DEMANDED CERTIFICATE OF SERVICE I hereby certify that I am this 29th day of September, 2014 serving a true and correct copy of the foregoing document upon the persons and in the manner indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure: A) By Deposit in the United States Mail at Harrisburg, Pennsylvania, with first class mail postage, prepaid, as follows: Date: B) By Hand Delivery: Michael A. Scherer, Esq. BARIC SCHERER, LLC 19 West South Street Carlisle, PA 17013 Chadwick O. Bogar 1426 N Third Street, Suite 200 PO Box 5400 Harrisburg PA 17110 By: onathan M. Crist, Esq. 1-:". • IL OF , • 11 IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA BRADLEY A. SCHUTJER, Plaintiff No. 2014-5044 rp77. r•„ L PVL y PL: YL PM 2: 0 V. CIVIL ACTION — LAW CHADWICK 0. BOGAR and SCHUTJER BOGAR, LLC, Defendants JURY TRIAL DEMANDED PRELIMINARY OBJECTIONS OF DEFENDANT CHADWICK 0. BOGAR AND NOW, comes Defendant, CHADWICK 0. BOGAR, and pursuant to Pennsylvania Rule of Civil Procedure 1028 makes the following Preliminary Objections to Plaintiff's Complaint: 1. Failure to Conform to Law or Rule of Court (Rule 1028(a)(2)) (A) Where an action is founded upon a writing, the complete writing shall be attached to the Complaint. (B) The May 24, 2013 Agreement (the "May 24, 2013 Agreement") which is attached as Exhibit "A" to Plaintiffs Complaint recites that it is an modification and/or amendment to that certain undated June 2011 SECOND AMENDED AND RESTATED OPERATING AGREEMENT between Plaintiff Bradley A. Schutjer and Defendant Chadwick 0. Bogar concerning their ownership interests in Schutjer Bogar LLC (the "Restated Members Agreement"), and to the extent not contradicted by the May 24th 2013 Agreement the terms and conditions of the Restated Members Agreement "shall remain in full force and effect". A copy of the Restated Members Agreement is attached hereto as Exhibit "1" to these Preliminary Objections. 2. Agreement For Alternative Dispute Resolution (Rule 1028(a)(6)) Section 6.07 of the Restated Members Agreement requires mandatory mediation of the dispute which is the subject of the Complaint prior to the filing of litigation. 3. Improper Venue (Rule 1028(a)(1)) Section 12.07 of the Restated Members Agreement establishes Dauphin County Pennsylvania as the agreed venue for all disputes with regard to the Restated Members Agreement. 4. Insufficient Specificity In A Pleading — Motion For A More Definite Statement (Rule 1028(a)(3)) Motion For a More Definite Statement in that Plaintiffs Complaint: (i) fails to specify the dates and amounts of payments which were allegedly not made to Plaintiff Bradley D, Schutjer under the May 24th 2013 Agreement and/or (ii) fails to specify how the sum of $95,000.00 claimed as damages was calculated or arrived at. WHEREFORE, Defendant, Chadwick 0. Bogar demands that the Complaint of the Plaintiff be dismissed. Chadwick 0. Bogar, Esq. 1426 N. Third Street, Suite 200 PO Box 5400 Harrisburg PA 17110 PH: (717) 712-3131 FX: (717) 909-5925 CV EXHIBIT "1" SECOND AMENDED AND RESTATED OPERATING AGREEMENT SCHUTJER BOGAR LLC A Pennsylvania Limited Liability Company THIS SECOND AMENDED AND RESTATED OPERATING AGREEMENT (this "Agreement") is made this day of June, 2011, by and between CHADWICK O. BOGAR, an adult individual ("Chad"), and BRADLEY A. SCHUTJER, an adult individual ("Brad") (Chad and Brad being hereinafter sometimes individually referred to as a "Member" and collectively as the "Members"). WITNESSETH: A. By Certificate of Organization filed with the Pennsylvania Department of State on February 12, 2004 (and resubmitted on March 5, 2004) (the "Certificate"), the Members and John K. Kennedy ("Kennedy") organized a Pennsylvania limited liability company known as Kennedy Bogar LLC (the "Company"). B. The Company, which has been assigned Entity No. 3186867 by the Pennsylvania Department of State, and EIN 80-0089736 by the Internal Revenue Service, is a restricted professional company, organized to render professional legal services. C. The Members and Kennedy entered into a certain Operating Agreement, executed on January 11, 2004 (the "Initial Agreement"), to govern the affairs of the Company. D. On December 24, 2004, Kennedy resigned from the Company. E. By Certificate of Amendment filed with the Pennsylvania Department of State on January 21, 2005 (and resubmitted on February 24, 2005), the Members amended the Certificate to change the name of the Company to Schutjer Bogar LLC, and to change the registered office of the Company. F. By Addendum dated March 10, 2006, the Members made certain changes to the Initial Agreement and adopted an Amended and Restated Operating Agreement. G. The Members desire to amend and restate all of their prior agreements, in accordance with the terms and conditions of this Agreement. NOW, THEREFORE, the parties, intending legally to be bound hereby, agree as follows. ARTICLE I DEFINITIONS 1.01 Definitions. As used in this Agreement, the following terms have the following meanings: "Act" means the Pennsylvania Limited Liability Company Law of 1994, 15 Pa.C.S. § 8901 et seq., as amended, and any successor statute, as amended from time to time. "Business Day" means any day other than a Saturday, a Sunday, or holidays on which national banking associations in the Commonwealth of Pennsylvania are closed. "Capital Contribution" means any contribution by a Member to the capital of the Company. "Code" means the Internal Revenue Code of 1986, as amended, and any successor statute, as amended from time to time. "Disability" means that: (A) a Member (1) has been unable to perform or conduct his normal activities on behalf of the Corporation for a period of six consecutive months or more, or (2) has been unable to perform same for a total of twelve months in any twenty-four month period, due to medical or psychological reasons; or (B) Dr. Richard Harker, or, if he is not willing or able to do so, another independent, qualified physician, psychiatrist or clinical psychologist ("Physician"), as appropriate, has declared to a reasonable degree of medical certainty, after examination of the Member, that the Member is disabled due to medical or psychological reasons and is not expected to sufficiently recover from his disability so as to be able to perform or conduct his normal activities on behalf of the Company in six (6) months; or (C) a Member has made a claim on and is paid under any long term disability policy (Company- owned or individually -owned). Each Member agrees, to the extent reasonably practicable, to make himself available for an examination by the Physician, and to follow the recommendation of the Physician regarding further examination and testing. In connection with a determination as to whether such Member is suffering from a Disability, each Member intends for the other Member to be treated as the Member in question would be with respect to his rights regarding the use and disclosure of his individually identifiable health information or other medical records. This release authority applies to any information governed by the Health Insurance Portability and Accountability Act of 1996 (a/k/a HIPAA), 42 USC 1320d and 45 CFR 160-164 and authorizes: any physician, health-care professional, dentist, health plan, hospital, clinic, laboratory, pharmacy or other covered health-care provider, any insurance company and the Medical Information Bureau Inc. or other health-care clearinghouse that has provided treatment or services to him, or that has paid for or is seeking payment from him for such services, to give, disclose and release to the Company and to the other Member, without restriction, all of such Member's individually identifiable health information and medical records regarding any past, present or future medical or mental health condition, including all information relating to the diagnosis and treatment of HIV/AIDS, sexually transmitted diseases, mental illness, and drug or alcohol abuse, but only to the extent, however, relevant to a determination as to whether or not a Member is suffering from a Disability. "Default Interest Rate" means a rate per annum equal to the prime interest rate publicly quoted by The Wall Street Journal, Eastern Edition from time to time plus four percent (4%), with adjustments in that varying rate to be made on the same date as any change in that rate. "Founding Members" means Chad and Brad. "General Interest Rate" means a rate per annum equal to a varying rate per annum that is equal to the prime interest rate publicly quoted by The Wall Street Journal, Eastern Edition from 2 time to time plus two percent (2%), with adjustments in that varying rate to be made on the same date as any change in that rate. "Highest Possible Payout Rate" means a payment of $10,000 per month for each year such person had been a Member of the Company and such monthly payments shall continue until the payments have been made to such Member equal to the number of years such Member had been a Member of the Company. By way of example, if the Member had been a Member for exactly ten years, such Member would be paid a total of $1,200,000 ($10,000 x 12 months x 10 years = $1,200,000) over a period of 120 months. "Majority Interest" means one or more Members having among them more than fifty percent (50%) of the Membership Percentages of all Members permitted to vote on such matter. "Member" means any person executing this Agreement as of the date of this Agreement as a member or hereafter admitted to the Company as a member as provided in this Agreement, but does not include any person who has ceased to be a member in the Company. "Membership Interest' means the ownership interest of a Member in the Company and all rights appurtenant thereto, including, without limitation, rights to distributions (liquidating or otherwise), allocations, information, voting, consent and approval. "Membership Percentage" means the fifty percent (50%) for each Member. "PaBCL" means the Pennsylvania Business Corporation Law of 1988, 15 Pa.C.S. §1101 et seq., as amended, and any successor statute, as amended from time to time. "Restricted Activities" means a Member who during the one year period ("Restricted Period") commencing on the effective date of the Member's Withdrawal or Retirement (the "Separation Date") directly or indirectly, on his or her own behalf or as a partner, shareholder, member, or employee of another person or entity: provides legal services or advice (whether written or oral) to or for (A) any person or entity who, during the 12 -month period prior to the Separation Date was a client of the Company, including any client who elects to be represented by the withdrawing Member pursuant to Section 3.07(d) above ("Former Client"), or (B) any person or entity who owns or operates (or who is licensed to own or operate) a long-term care nursing facility, personal care home, community care retirement community, or assisted living facility within the Commonwealth of Pennsylvania. In the event that a court of competent jurisdiction shall determine that one or more of the provisions of the Restricted Activities is so broad as to be unenforceable, then such provision shall be deemed to be reduced in scope or length, as the case may be, to the extent required to make this Paragraph enforceable. If the Member violates the Restricted Activities, the periods described therein shall be extended by that number of days which equals the aggregate of all days during which at any time any such violations occurred. "Section 4094" means Section 409A of the Code, and the regulations and other binding guidance promulgated thereunder. "Separation Date" means the date identified in the definition of Restricted Activities. "Super Majority Interest" means one or more Members having among them more than Two -Thirds (2/3) of the Membership Percentages of the Members permitted to vote on such matter. "Transfer" means to sell, give, transfer, bequeath, pledge, encumber or otherwise dispose of, whether voluntarily or involuntarily by operation of law. "Unanimous" means all Members having among them 100% of the Membership Percentages of all Members permitted to vote on such matter. Other terms defined herein have the meanings so given them. 1.02 Construction. Whenever the context requires, the gender of all words used in this Agreement includes the masculine, feminine, and neuter. All references to Articles and Sections refer to articles and sections of this Agreement, and all references to Exhibits are to Exhibits attached hereto, each of which is made a part hereof for all purposes. ARTICLE II ORGANIZATION 2.01 Formation. The Company has been organized as a Pennsylvania limited liability company, and restricted professional company, by the filing of the Certificate with the Department of State of the Commonwealth of Pennsylvania under and pursuant to the Act. 2.02 Name. The name of the Company is "Schutjer Bogar LLC", and all Company business must be conducted in that name or such other names that comply with applicable law as the Members may select from time to time. 2.03 Registered Office; Registered Agent; Principal Office in the United States; Other Offices. The registered office of the Company required by the Act to be maintained in the Commonwealth of Pennsylvania shall be 1426 N. 3rd Street, Suite 200, Harrisburg, Dauphin County, Pennsylvania 17105, or such other office (which need not be a place of business of the Company) as the Members may designate from time to time in the manner provided by law. The principal office of the Company shall be at such place as the Members may designate from time to time, which need not be in the Commonwealth of Pennsylvania. The Company may have such other offices as the Members may designate from time to time. 2.04 Purpose. The Company is organized to render professional legal services as a restricted professional company under the Act. 2.05 Foreign Qualification. Prior to the Company's conducting business in any jurisdiction other than the Commonwealth of Pennsylvania, the Members shall cause the Company to comply with all requirements necessary to qualify the Company as a foreign limited liability company in that jurisdiction. Each Member shall execute, acknowledge, swear to, and deliver all certificates and other instruments conforming with this Agreement that are necessary or appropriate to qualify, continue, and terminate the Company as a foreign limited liability company in all such jurisdictions in which the Company may conduct business. 4 2.06 Term. The Company commenced on the date the Certificate was filed with the Department of State of the Commonwealth of Pennsylvania, and shall continue in existence in perpetuity, or such earlier time as this Agreement may specify. 2.07 No State -Law Partnership. The Members intend that the Company not be a partnership (including, without limitation, a limited partnership) or joint venture, and that no Member be a partner or joint venturer of any other Member, for any purposes other than for federal and state income tax purposes, and this Agreement shall not be construed to produce a contrary result. ARTICLE III MEMBERSHIP, RESTRICTIONS ON TRANSFERS 3.01 Members. Chad and Brad are the Founding Members, and are currently all of the Members of the Company. 3.02 No Certification. No Membership Interest in the Company shall be required to be represented by a separate certificate. 3.03 General Restrictions on Transfer. Except as otherwise expressly provided in this Agreement, at no time shall any Member or their legal representative Transfer, or attempt to Transfer, any of their Membership Interest without the Unanimous written consent of the Members. 3.04 Liability to Third Parties. Except as provided in this Agreement, no Member shall be liable for the debts, obligations or liabilities of the Company, including under a judgment decree or order of a court. 3.05 Information. (a) In addition to the other rights specifically set forth in this Agreement, each Member is entitled to all information to which that Member is entitled to have access pursuant to Sections 1508 and 1764 of the PaBCL under the circumstances and subject to the conditions therein stated. (b) The Members acknowledge that, from time to time, they may receive information from or regarding the Company in the nature of trade secrets or that otherwise is confidential, the release of which may be damaging to the Company or persons with which it does business. Each Member shall hold in strict confidence any information it receives regarding the Company that is identified as being confidential (and if that information is provided in writing, that is so marked) and may not disclose it to any person other than another Member, except for disclosures (i) compelled by law (but the Member must notify the other Members promptly of any request for that information before disclosing it, if practicable), (ii) to advisers or representatives of the Member or persons to which that Member's Membership Interest may be transferred as permitted by this Agreement, but only if the recipients have agreed to be bound by the provisions of this Section 3.05(b), or (iii) of information that Member also has received from a source independent of the Company that the Member reasonably believes obtained that information without breach of any obligation of confidentiality. The Members 5 acknowledge that breach of the provisions of this Section 3.05(b) may cause irreparable injury to the Company for which monetary damages are inadequate, difficult to compute, or both. Accordingly, the Members agree that the provisions of this Section 3.05(b) may be enforced by specific performance or injunction (temporary or permanent) without the necessity of proving damages, actual or otherwise. 3.06 Additional Members. Additional persons may be admitted to the Company as Members and additional Membership Interests may be created and issued to those persons at the direction of the Members upon the affirmative vote of a Super Majority Interest of the Members and on such terms and conditions as the Members may determine at the time .of admission. The terms of admission or issuance may provide for the creation of different classes or groups of Members and having different preferences, rights, powers, and duties with respect to the Company. The Members may reflect the creation of any new class or group through the filing of an amendment to the Certificate and/or in an amendment to this Agreement. Any such admission is effective only after the new Member has executed and delivered to the other Members a document including the new Member's notice address and its agreement to be bound by this Agreement. 3.07 Voluntary Withdrawal of a Member. (a) In the event that any Member desires to withdraw voluntarily from the Company (other than as part of permanent retirement pursuant to Section 6.01 below) ("Withdrawal"), he or she shall serve upon the other Member(s) written notice of intention to do so. Notice shall be served at least three (3) full months prior to the effective date of the Withdrawal, unless the Company shall expressly consent to an earlier date by the affirmative vote of not less than fifty-one percent of the remaining Membership Percentages (excluding the withdrawing Member). The effective date of a Withdrawal shall in every case be the last day of a calendar month. The Company shall pay the withdrawing Member's monthly distribution through the effective date of the Withdrawal, pro rated for any partial month, for each month after he or she shall.give notice, so long as he or she continues to devote his or her time diligently and faithfully to the business of the Company (pursuant to Section 7.07 below) until the Withdrawal becomes effective. In the case where a Withdrawal from the Company is other than the last day of a calendar month, the Member shall receive a pro rata portion of what would have been the Member's distribution for that month, and an allocation of income and loss pursuant to Section :5.01 hereof, determined by dividing the number of business days in the month during which the Member continued as a Member in the Company by the total number of business days in the month. Notwithstanding any matter contained in this Section 3.07, the other Member(s) shall have the right and authority to make any Withdrawal effective earlier than the aforesaid effective date, to the extent deemed to be in the best interests of the Company by a vote of at least fifty-one percent of the remaining Membership Percentages (excluding the withdrawing Member). (b) It is expressly understood and agreed that, pursuant to Section 8971(a)(4) of the Act, a Withdrawal shall not cause the dissolution of the Company, and the Company shall have the right to continue under its present name, except to the extent otherwise provided by applicable law. 6 (c) If a Member withdraws from the Company, all interest of the withdrawing Member in the Company, and its property and assets of any nature whatsoever, including goodwill, shall be terminated as of the effective date of his or her Withdrawal and such interest shall be liquidated with the sole consideration therefor being the payment of 50% of the Highest Possible Payout Rate being paid on a monthly basis over the applicable number of months. Payments to the withdrawing Member are intended to represent payments for a Member's interest under Section 736(b) of the Code for the withdrawing Member's interest in the Company's property, including goodwill and other intangibles of the Company. If, the withdrawing Member engages in Restricted Activities during the Restricted Period, the withdrawing Member's sole consideration shall be 25% of the Highest Payout Rate being paid on a monthly basis with any previous amounts overpaid being returned or offset against future payments. Additionally, the withdrawing Member shall pay to the Company 40% of any gross revenue that the withdrawing Member, or those acting on behalf of or in conjunction with the withdrawing Member, earn (regardless of when actually paid to the withdrawing Member) by engaging in Restricted Activities. The withdrawing Member hereby agrees that he or she shall not have the right to receive any amounts pursuant to Section 8933 of the Act. (d) Each Member covenants that in the event he or she shall withdraw from the Company, he or she will fully cooperate in good faith in making an orderly transfer to the remaining Members of all pending matters pertaining to the affairs of those clients whose business he or she has carried on or supervised, unless any such client shall expressly elect to continue to be represented by the withdrawing Member. Subject to Section 3.07(c) above, if any client shall elect to continue to be represented by the withdrawing Member, and the withdrawing Member shall elect to continue to represent the client, the withdrawing Member shall be entitled to receive all papers and work -in -progress pertaining to the affairs of the client upon payment to the Company of an amount equal to all unpaid bills charged against the client plus the value of all unbilled work -in -progress which has been performed for the client to the Separation Date (the value to be computed at the then prevailing rate generally charged for such services) and all unbilled disbursements to such date. Upon payment of said amount, the withdrawing Member shall be entitled to all fees thereafter collected from the client, subject to 3.07(c) above, and the Company shall assign its rights to the withdrawing Member. The Company shall be authorized to set off any payments due the withdrawing Member against any other amount(s) which the Company is entitled from the withdrawing Member. (e) The liability of any withdrawing Member for any act or thing which shall occur on or before the Separation Date shall not be affected by his or her Withdrawal. (f) The Members further acknowledge and agree that it is and shall be their intention that the terms and conditions of this Section 3.07 shall comply with all rules and requirements applicable to the practice of law (including, without limitation intended, Rule 5.6 of the Pennsylvania Rules of Professional Conduct). If any term or provision of this Section 3.07 or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Section 3.07 or the application of any such term or provision to persons or circumstances, other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Section 3.07 shall be valid and enforceable to the fullest extent permitted by law. 7 ARTICLE IV CAPITAL CONTRIBUTIONS 4.01 Capital Contributions. (a) The Members heretofore made the initial Capital Contributions, in cash, in kind or otherwise, described for that Member in Exhibit A attached hereto. (b) After the initial Capital Contribution, the Company may require each Member to make additional Capital Contributions from time to time; provided that, any request of a Member to make a Capital Contribution shall require the affirmative vote of a Super Majority Interest of the Members. 4.02 Failure to Contribute. If a Member does not contribute by the time required all or any portion of a Capital Contribution which that Member is required to make as provided in this Agreement, the Company shall have such rights and remedies as may be available at law or in equity. 4.03 Return of Contributions. A Member is not entitled to the return of any part of its Capital Contributions or to be paid interest in respect of either its capital account or its Capital Contributions. An unreturned Capital Contribution is not a liability of the Company or of any Member. A Member is not required to contribute or to lend any cash or property to the Company to enable the Company to return any Member's Capital Contributions. 4.04 Advances by Members. lithe Company does not have sufficient cash to pay its obligations, any Member(s) that may agree to do so with the other Members' consent may advance all or part of the needed funds to or on behalf of the Company. An advance described in this Section 4.04 constitutes a loan from the Member to the Company, bears interest at the General Interest Rate from the date of the advance until the date of payment, and is not a Capital Contribution. 4.05 Capital Account. A capital account shall be established and maintained for each Member in accordance with applicable provisions of the Code and applicable regulations. A Member that has more than one Membership Interest shall have a single capital account that reflects all its Membership Interests, regardless of the class of Membership Interests owned by that Member and regardless of the time or manner in which those Membership Interests were acquired. On the transfer of all or part of a Membership Interest as permitted by this Agreement, the capital account of the transferor Member that is attributable to the transferred Membership Interest or part thereof shall carry over to the transferee Member in accordance with the Code and applicable regulations. ARTICLE V ALLOCATIONS AND DISTRIBUTIONS 5.01 Allocations. Except as may be required by the Code and applicable regulations and unless otherwise agreed to among the Members, all items of income, gain, loss, deduction, and credit of the Company shall be allocated among the Members in accordance with their Membership Percentages. 8 5.02 Distributions. (a) From time to time (but at least monthly), the Members shall determine in their reasonable judgment to what extent (if any) the Company's cash on hand exceeds its current and anticipated needs, including, without limitation, for operating expenses, debt service, acquisitions, and a reasonable contingency reserve. If such an excess exists, the Members shall cause the Company to distribute to the Members an amount in cash equal to that excess, which shall be their draw from the Company. (b) From time to time, the Members also may cause property of the Company other than cash to be distributed to the Members, which distribution must be made in accordance with their Membership Interest, unless otherwise agreed to by the affirmative vote of a Super Majority Interest of the Members, and may be made subject to existing liabilities and obligations. ARTICLE VI RETIREMENT, EXPULSION, DISABILITY, DEATH 6.81 Retirement. (a) In the event that any Member desires to retire permanently from the practice of law and withdraw from the Company as a result of such permanent retirement ("Retirement"), he or she shall serve upon the other Members written notice of intention to do so. Notice shall be served at least three (3) full months prior to the effective date of the Member's Retirement, unless the Company shall expressly consent to an earlier date by the affirmative vote of not less than fifty-one percent of the remaining Membership Percentages (excluding the retiring Member). The effective date of a Retirement shall in every case be the last day of a calendar month. The Company shall pay the retiring Member's monthly distribution through the effective date of the Retirement, pro rated for any partial month, for each month after he or she shall give notice, so long as he or she continues to devote his or her time diligently and faithfully to the business of the Company (pursuRnt to Section 7.07 below) until the Retirement becomes effective. In the case where a Member's Retirement from the Company is other than the last day of a calendar month, the Member shall receive a pro rata portion of what would have been the Member's distribution for that month, and an allocation of income and loss pursuant to Section 5.01 hereof, determined by dividing the number of business days in the month during which the Member continued as a Member in the Company by the total number of business days in the month. Notwithstanding any matter contained in this Section 6.01, the other Member(s) shall have the right and authority to make any Retirement effective earlier than the aforesaid effective date, to the extent deemed to be in the best interests of the Company by a vote of at least fifty- one percent of the remaining Membership Percentages (excluding the retiring Member). (b) The terms and conditions of Section 6.05 shall apply to the Membership Interest of the retired Member. (c) If a Member retires from the Company, all interest of the retiring Member in the Company, and its property and assets of any nature whatsoever, including goodwill, shall be terminated as of the Separation Date and such interest shall be liquidated with the sole consideration therefor being payment of the Highest Possible Payout Rate paid on a monthly 9 basis over the applicable number of months. Payments to the retiring Member are intended to represent payments for a Member's interest under Section 736(b) of the Code for the retiring Member's interest in the Company's property, including goodwill and other intangibles of the Company. If the retiring Member engages in Restricted Activities during the Restricted Period, the retiring Member's sole consideration shall be 25% of the Highest Possible Payout Rate paid on a monthly basis with any previous amounts overpaid being returned or offset against future payments. Additionally, the retiring Member shall pay to the Company 40% of any gross revenue that the retiring Member, or those acting on behalf of or in conjunction with the retiring Member, earn (regardless of when actually paid to the retiring Member) by engaging in Restricted Activities. In the event that a former Member dies while receiving payments under his Retirement, such payments shall be made to such former Member's personal representatives. (d) The Members further acknowledge and agree that it is and shall be their intention that the terms and conditions of this Section 6.01 shall comply with all rules and requirements applicable to the practice of law (including, without limitation intended, Rule 5.6 of the Pennsylvania Rules of Professional Conduct). If any term or provision of this Section 6.01 or the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Section 6.01 or the application of any such term or provision to persons or circumstances, other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Section 6.01 shall be valid and enforceable to the fullest extent permitted by law. 6.02 Expulsion from Company. (a) A Member may be expelled from the Company at any time ("Expulsion" upon the occurrence of one or more of the following events ("Cause"): (i) The Member makes an assignment, in part or in whole, of the Shareholder's shares for the benefit of creditors; (ii) The Member files a voluntary petition of bankruptcy or consents to the filing of a petition for involuntary bankruptcy; (iii) The Member is adjudged bankrupt or insolvent or there is entered against the Member an order for relief in any bankruptcy or insolvency proceeding; (iv) The Member seeks, consents to, or acquiesces in the appointment of a trustee for, receiver for, or liquidation of any substantial part of the Member's properties; (v) The Member files an answer or other pleading admitting or failing to contest in a timely fashion the material allegations of a petition filed against the Member in any proceeding described in Subsections (i) through (iv); (vi) Any proceeding against the Member seeking reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any statute, law, or regulation continues for one hundred twenty (120) days after the commencement 10 thereof, or the appointment of a trustee, receiver, or liquidator for the Member or all or any substantial part of the Member's properties without the Member's agreement or acquiescence, which appointment is not vacated or stayed for one hundred twenty (120) days or, if the appointment is stayed, for one hundred twenty (120) days after the expiration of the stay during which period the appointment is not vacated; (vii) The revocation or suspension of the Member's license to practice law in the Commonwealth of Pennsylvania, or any sanctions being entered against the Member by any regulatory authority due to misconduct by the Member in the practice of law; (viii) A Member's failure to comply with the terms and conditions of this Agreement, including (without limitation intended) Section 7.07 below; or (ix) The occurrence of any event (other than death) pursuant to which the Member's Membership Interest is to be transferred to the spouse of such Member by operation of law, including, without limitation intended, community property laws or divorce laws, but only if such Member does not obtain from his spouse a binding, written release of any and all rights such spouse may have in or to the Membership Interests, which is reasonably satisfactory to the other Member, within sixty (60) days after notice requesting such release. The Members each agree to notify each other within thirty (30) days of any change in residence or the commencement of any divorce or similar proceedings or any spousal separation for more than thirty (30) days. (b) Any dispute reg • rding the existence of Cause shall be decided pursuant to Section 6.07 below. (c) The Company shall pay an expelled Member's monthly distribution for the month during which he or she is expelled, pro rated for any partial month in which the Member is expelled, but otherwise the expelled Member shall not be entitled to any distributions from the Company. In the case where a Member's Expulsion from the Company is other than the last day of a calendar month, the Member shall receive an allocation of income and loss pursuant to Section 5.01 hereof, determined by dividing the number of business days in the month during which the Member continued as a Member in the Company by the total number of business days in the month. (d) If a Member is expelled from the Company, all interest of the withdrawing Member in the Company, and its property and assets of any nature whatsoever, including goodwill, shall be terminated as of the effective date of his or her expulsion and such interest shall be liquidated and forfeited. If, the expelled Member engages in Restricted Activities during the Restricted Period, he or she shall pay to the Company 40% of any gross revenue that the expelled Member, or those acting on behalf of or in conjunction with the expelled Member, earn (regardless of when actually paid to the expulsed Member) by engaging in Restricted Activities. (e) The Members further acknowledge and agree that it is and shall be their intention that the terms and conditions of this Section 6.02 shall comply with all rules and requirements applicable to the practice of law (including, without limitation intended, Rule 5.6 of the Pennsylvania Rules of Professional Conduct). If any term or provision of this Section 6.02 or 11 the application thereof to any person or circumstance shall, to any extent, be invalid or unenforceable, the remainder of this Section 6.02 or the application of any such term or provision to persons or circumstances, other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Section 6.02 shall be valid and enforceable to the fullest extent permitted by law. (f) The terms and conditions of Section 6.05 shall apply to the Memberthip Interest of the expelled Member. Upon the Expulsion of a Member, such Member shall automatically and without further action be deemed to have surrendered his entire ownership interest in the Company to the Company. 6.03 Disability. (a) In the event a Member fails to provide full-time services for four (4) weeks during any 8 -week period: (i) The Member shall be entitled to a full monthly distribution for the month prior the month in which the Member did not provide full-time services (the "Target Month"). (ii) The Company shall use best efforts to engage one or more persons to provide replacement services (to the extent such replacement services are needed), in which case the Member who failed to provide the services shall be entitled to continue to receive monthly distributions for six (6) months after the Target Month as the Member's monthly draw; provided, however, that such Member's distribution in each case shall be reduced, dollar -for - dollar, by all additional costs and expenses incurred by the Company in obtaining the replacement services. (iii) At the end of the foregoing 6 -month period, if the Member has not returned to work and provided full-time services during the month immediately preceding the expiration of the 6 -month period, the Member shall be deemed to have suffered a Disability effective as of the expiration of the 6 -month period. (b) The Members acknowledge that the terms and conditions of this Section 6.03 are fair and reasonable, in light of the fact that each Member has heretofore obtained an individual disability policy for his own protection. It shall be the responsibility of each Member to maintain each such policy in place, as by timely paying all necessary premiums. (c) The terms and conditions of Section 6.05 shall apply to the Membership Interest of a Member who has suffered a Disability. A Member who has suffered a Disability shall be treated as if the Member selected Retirement under Section 6.01 and the provisions of Section 6.01(c), and (d) shall govern. 6.04 Death. (a) In the event a Member dies while a Member during the term of this Agreement, the Member's estate shall be entitled to a full monthly distribution for the month during which the date of death occurs. In the case where a Member's death is other than the last 12 day of a calendar month, the Member shall receive an allocation of income and loss pursuant to Section 5.01 hereof, determined by dividing the number of business days in the month during which the Member continued as a Member in the Company by the total number of business days in the month. (b) It is understood and agreed that the Member (and/or his estate) shall not be entitled to receive any proceeds from any life insurance policy or policies on the deceased Member's life, the Company having obtained such policy(ies) as "keyman" policies, to compensate the Company for the loss of services suffered as a result of a Member's death. (c) The terms and conditions of Section 6.05 shall apply to the Membership Interest of a Member who has died during the term of this Agreement. 6.05 Other Terms and Conditions. (a) It is expressly understood and agreed that, pursuant to Section 8971(a)(4) of the Act, a Member's Retirement, Expulsion, Disability or death shall not cause the dissolution of the Company, and the Company shall have the right to continue under its present name, and to utilize the name of the Separating Member (as defined in Section 6.05(b) below), except as otherwise provided by applicable law. (b) Except as otherwise provided in this Agreement, all interest of any Member who retires, is expelled, suffers a Disability, or dies (the "Separating Member"), in the Company and its property and assets of any nature whatsoever, including goodwill, shall be terminated as of the effective date of his or her Retirement, Expulsion, Disability, or death. The Separating Member hereby agrees that he or she shall not have the right to receive any amounts pursuant to Section 8933 of the Act. (c) The liability of any Separating Member for any act or thing which shall occur on or before the effective date of his or her Retirement, Expulsion, Disability, or death shall not he affected by his or her Retirement, Expulsion, Disability, or death. (d) Each Separating Member (or his or her estate, as applicable) covenants that he or she will fully cooperate in good faith in making an orderly transfer to the remaining Members of all pending matters pertaining to the affairs of those clients whose business he or she has carried on or supervised, unless any such client shall expressly elect to continue to be represented by a Separating Member. If any client shall elect to continue to be represented by a Separating Member, and the Separating Member shall elect to continue to represent the client, the Separating Member shall be entitled to receive all papers and work -in -progress pertaining to the affairs of the client upon payment to the Company of an amount equal to all unpaid bills charged against the client plus the value of all unbilled work -in -progress which has been performed for the client to the effective date of the separation (the value to be computed at the then prevailing rate generally charged for such services) and all unbilled disbursements to such date. Upon payment of said amount, the Separating Member shall be entitled to all fees thereafter collected from the client subject to Section 3.07(c) or 6.02(d), and the Company shall assign its rights to the Separating Member. The Company shall be authorized to set off any 13 payments due the Separating Member against any other amount(s) which the Company is entitled from the Separating Member. 6.06 Purchase of Membership Interests at Death. (a) The Membership Interest of a deceased Member shall be subject to an obligation on the part of the Company to purchase such Membership Interest, and the purchase price for the Membership Interest of a deceased Member in liquidation of such deceased Member's interest in the Company shall be an amount equal to $5,000,000. Payments to the deceased Member are intended to represent payments for a Member's interest under Section 736(b) of the Code for the deceased Member's interest in the Company's property, including goodwill and other intangibles of the Company. (b) The purchase price for the Membership Interest of a deceased Member shall be paid as follows: (i) at closing, the Company shall make a payment in cash equal to one-third (1/3) of the purchase price; (ii) at closing, the Company shall deliver a 2 -year promissory note providing for two equal annual installments of the balance of the purchase price, with interest payable annually at the Applicable Federal Rate in effect on the date that the promissory note is issued, determined in accordance with Section 1274(d) (or any successor provision) of the Code. In the event of default of payment for a period of ten (10) days, the remainder of the principal and accrued interest then unpaid under the promissory note shall become due and payable at once. The maker of any promissory note delivered hereunder shall have the right to prepay the principal amount due on such note at any time without a prepayment penalty; (iii) If the Company owns any insurance policy(s) on the life of a deceased Member and if the Company is purchasing such deceased Member's interest in the Company, then an amount equal to the insurance proceeds received by the Company shall be paid to the estate or personal representative of the deceased Member at the closing of the transfer of his interest in the Company, but not in excess of the purchase price as determined in accordance with this Section 6.06. Any such insurance proceeds represent the property of the Company and references herein to any such insurance proceeds are merely to measure amounts to be paid to the estate or personal representative of a deceased Member at a closing. The insurance proceeds shall reduce the purchase price determined under Section 6.06(a) above and shall represent all or part of the payment due at closing under Section 6.06(b)(i) and, if the insurance proceeds are in excess of the cash payment required, shall then be applied to reduce the promissory note to be delivered under Section 6.06(b)(ii); and (iv) Notwithstanding the other limitations and restrictions of this Agreement, as long as the promissory note, if any, described in this Section 6.06(b) is outstanding, the Company shall not, without the prior written consent of the holder of the promissory note, make any extraordinary distributions to any Member, incur any debt or pledge 14 its assets as security for any debt (other than in the ordinary course of business), reorganize, merge or consolidate or dispose of any of its assets other than in the ordinary course of business. (c) Closing on all purchases hereunder shall take place within sixty (60) days after the date of determination of the purchase price and the receipt by the Company of any life insurance proceeds on the death of the deceased Member, if any, at such time and place as the parties shall agree. At the closing, the Company shall deliver to the deceased Member's personal representative the purchase price in accordance with this Section 6.06, and the deceased Member's personal representative shall execute and deliver to the Company such assignments, instruments of conveyances and other documents and instruments as the Company shall reasonably request to effectively convey title to the deceased Member's Membership Interest. In addition, the Company, at closing, shall, to the extent reasonably practicable, obtain and deliver the unconditional release, in form reasonably satisfactory to the deceased Member's personal representative, of the deceased Member of and from any personal guarantees made by the deceased Member, if any, with respect to indebtedness or liabilities of the Company. Each party shall pay his, her, or its own attorneys fees. 6.07 Mediation. (a) Any and all disputes or claims arising out of or relating to the validity, interpretation, enforceability or performance of this Agreement, the existence of Cause, and/or any deadlock of the Members (including, without limitation intended, any action or proposed action with respect to a Member), shall first be submitted to mediation for resolution as a condition prerequisite to any action to enforce, or for a breach of, this Agreement. Subject to his availability, the parties agree to employ the services of Gregory A. Miller, Esquire, of Buchanan Ingersoll & Rooney, PC or his designee, as the mediator. The Members agree that each must pursue mediation within ten (10) business days after the date on which the dispute arose, and that the mediation shall take place in Pittsburgh, Pennsylvania. This Section 6.07 shall not apply to violations of the non -competition provisions of this Agreement and violations of Section 3.05(b) above. (b) In the event the Members cannot resolve any dispute through mediation within ten (10) business days after commencement of mediation, then any Member shall have available all remedies at law or in equity (including the right to bring an action for declaratory judgment), with jurisdiction and venue to be in accordance with Section 12.07 below. 6.08 Adverse Business Operations. (a) In any case where the Company is making payments (or obligated to make payments) to a former member of the Company (or such person's estate or heirs) under Section 3.07(c) (voluntary withdrawal), Section 6.01(c) (retirement), Section 6.03 (c)(disability), or Section 6.06(a) (death), and if the Company's billables/receivables for any quarter do not exceed that quarter's expenses by 20%, then Gregory A. Miller, Esquire of Buchanan Ingersoll & Rooney, PC or his designee, shall have the right to immediate access of all Company records for his review and shall have management authority over all Company personnel in the course of their carrying out their duties for the Company, 15 (b) Mr. Miller, or his designee, shall be permitted to act in accordance with Section 6.08 hereof until such time as the Company's billables/receivables for any quarter exceed that quarter's expenses by 20%. ARTICLE VII MANAGEMENT 7.01 Management. The powers of the Company shall be exercised by and under the authority of, and the business and affairs of the Company shall be managed by the Members, who shall make all decisions and take all actions for the Company not otherwise provided for in this Agreement upon the affirmative vote of a Super Majority Interest of the Members, including, but not limited to, the following: (a) acquire by purchase, lease or otherwise any real or personal property which may be necessary, convenient, or incidental to the accomplishment of the purposes of the Company; (b) develop, operate, maintain, finance, improve, construct and own all real and personal property necessary, convenient, or incidental to the accomplishment of the purposes of the Company; (c) execute any and all agreements, contracts, documents, certificates, plans and instruments necessary or convenient in connection with managing the affairs of the Company; (d) execute, in furtherance of any or all of the purposes of the Company, any deed, lease, mortgage, deed of trust, mortgage note, promissory note, bill of sale, contract, security agreement, financing statement, assignments or other instrument purporting to convey or encumber any or all of the Company property; (e) prepay in whole or in part, refinance, recast, increase, modify or extend any liability affecting the Company property and in connection therewith execute any extensions or renewals of encumbrances on any or all of the Company property; (f) contract on behalf of the Company for the employment and services of employees and/or independent contractors, such as attorneys and accountants; (g) engage in any kind of activity and perform and carry out contracts of any kind (including contracts of insurance covering risks to Company property) necessary or incidental to, or in connection with, the accomplishment of the purposes of the Company, as may be lawfully carried on or performed by the Company under the laws of Pennsylvania; (h) take, or refrain from taking, all actions, not expressly prescribed or limited by this Agreement, as may be necessary or appropriate to accomplish the purposes of the Company; (i) institute, prosecute, defend, settle, compromise and dismiss lawsuits or other judicial or administrative proceedings brought on or in behalf of, or apinst, the Company 16 or the Members in connection with activities arising out of, connected with, or incidental to this Agreement, and to engage counsel or others in connection therewith; and (j) do all other acts and things permitted by law and not otherwise prohibited by this Agreement or the Act. 7.02 Meetings. (a) A quorum shall be present at a meeting of Members if the holders of a Majority Interest are represented at the meeting in person or by proxy. With respect to any matter and except as otherwise provided in this Agreement, the affirmative vote of a Majority Interest at a meeting of Members at which a quorum is present shall be the act of the Members. (b) All meetings of the Members shall be held at the principal place of business of the Company or at such other place within or without the Commonwealth of Pennsylvania as shall be specified or fixed in the notices or waivers of notice thereof; provided that any or all Members may participate in any such meeting by means of conference telephone or similar communications equipment pursuant to Section 7.06. (c) The chairman of the meeting or the holders of a Majority Interest shall have the power to adjourn such meeting from time to time, without any notice other than announcement at the meeting of the time and place of the holding of the adjourned meeting. If such meeting is adjourned by the Members, such time and place shall be determined by a vote of the holders of a Majority Interest. Upon the resumption of such adjourned meeting, any business may be transacted that might have been transacted at the meeting as originally called. (d) An annual meeting of the Members for the transaction of business as may properly come before the meeting, shall be held at such place, within or without the Commonwealth of Pennsylvania, on such date and at such time as the Members shall fix and set forth in the notice of the meeting. Failure to hold an annual meeting does not invalidate the Company's existence or affect any otherwise valid acts by the Members. (e) Special meetings of the Members for any proper purpose or purposes may be called at any time by the Members or the holders of at least thirty percent (30%) of the Membership Percentages of all Members. If not otherwise stated in or fixed in accordance with the remaining provisions hereof, the record date for determining Members entitled to call a special meeting is the date any Member first signs the notice of such meeting. Only business within the purpose or purposes described in the notice (or waiver thereof) required by this Agreement may be conducted at a special meeting of the Members. (f) Written or printed notice stating the place, day and hour of the meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than 10 nor more than 60 Business Days before the date of the meeting, either personally by mail, by or at the direction of the Members or person calling the meeting, to each Member entitled to vote at such meeting. If mailed, any such notice shall be deemed to be delivered when deposited in the United States mail, addressed to the Member at such Member's address provided for in Section 12.02, with postage thereon prepaid. 17 (g) The date on which notice of a meeting of Members is mailed or the date on which the resolution of the Members declaring a distribution is adopted, as the case may be, shall be the record date for the determination of the Members entitled to notice of or vote at such meeting, including any adjournment thereof, or the Members entitled to receive such distribution. 7.03 Voting List. The Members shall make available, at least 10 Business Days before each meeting, a complete list of the Members entitled to vote at such meeting or any adjournment thereof, arranged in alphabetical order, with the address of and the Membership Interest held by each, which list, for a period of ten days prior to such meeting, shall be kept on file at the registered office or principal place of business of the Company and shall be subject to inspection by any Member at any time during usual business hours. Such list shall also be produced and kept open at the time and place of the meeting and shall be subject to the inspection of any Member during the whole time of the meeting. At all times such list shall be kept confidential by the Members. The original membership records shall be prima-facie evidence as to who are the Members entitled to examine such list or transfer records or to vote at any meeting of Members. Failure to comply with the requirements of this Section shall not affect the validity of any action taken at the meeting. 7.04 Proxies. A Member may vote either in person or by proxy executed in writing by the Member. A telegram, telex, cablegram, fax, electronic e-mail or similar transmission by the Member, or a photographic, photostatic, facsimile or similar reproduction of a writing executed by the Member shall be treated as an execution in writing for purposes of this Section. A proxy shall be revocable unless the proxy form conspicuously states that the proxy is irrevocable. 7.05 Conduct of Meeting. All meetings of the Members shall be presided over by the chairman of the meeting, who shall be elected by a Majority Interest of the Members. The chairman of any meeting of Members shall determine the order of business and the procedure at the meeting, including such regulation of the manner of voting and the conduct of discussion as seem to him in order. 7.06 Action By Written Motion or Telephone Conference. (a) Any action required or permitted to be taken at any annual or special meeting of Members may be taken without a meeting, without prior notice, and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holder or holders of not less than the minimum Membership Percentages that would be necessary to take such action at a meeting at which the holders of all Membership Interest entitled to vote on the action were present and voted. (b) The record date for determining Members entitled to consent to action in writing without a meeting shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Company by delivery to its registered office, its principal place of business, or the Members. Delivery shall be by hand or by certified or registered mail, return receipt requested. 18 (c) If any action by Members is taken by written consent, any articles or documents filed with the Secretary of the Commonwealth of Pennsylvania as a result of the taking of the action shall state, in lieu of any statement required by the Act concerning any vote of Members, that written consent has been given in accordance with the provisions of the Act and that any written notice required by the Act has been given. (d) Members may participate in and hold a meeting by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in such meeting shall constitute attendance and presence in person at such meeting, except where a person participates in the meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened. 7.07 Full -Time Efforts. (a) Each Member shall devote his or her full time to the business of the Company and shall not engage in any other business or profession without the consent of the Company. Without limiting the foregoing, each Member shall make a good faith effort to participate in, and shall participate, in the operation and management of the Company. (b) No Member shall undertake any professionalmatter for compensation or accept any employment for compensation except for the benefit of the Company. A Member shall have the right to carry on individual investment activities, and/or to engage in community or similar activities so long as they do not interfere with his or her ability to carry out his or her duties as a Member. (c) Each Member shall practice law competently, shall comply with the provisions of the Pennsylvania Rules of Professional Conduct (or such other rules as may be applicable in those other jurisdictions where the Member practices law), shall discharge requirements of Continuing Legal Education, and shall file all federal, state and local tax returns in a timely fashion. ARTICLE VIII INDEMNIFICATION Subject to any limitations in the Act, the Company shall indemnify and defend and hold harmless each Member from and against any and all loss, cost, expense, damage or liability, including but not limited to reasonable attorneys' fees, arising out of or resulting from, in whole or in part, any action or inaction or omission, including but not limited to sole or partial negligence or breach of contract or breach of any duty or other conduct, by same within the scope of authority conferred by this Agreement and taken in good faith, except for acts or omissions constituting willful misconduct or recklessness. Recourse pursuant to the indemnification provided under this Article VIII shall be limited to the assets of the Company and no Individual Member shall be liable for any deficiency in such indemnification, however arising. 19 administered, interpreted and construed in a manner necessary in order to comply with Section 409A and the regulations issued thereunder, or an exception thereto (or disregarded to the extent such provision cannot be so administered, interpreted or construed), and the following provisions shall apply, as applicable: (a) The benefits provided under this Agreement shall be granted under terms and conditions consistent with Treas. Reg. § 1.409A -1(b)(5) such that any such benefits do not constitute a deferral of compensation under Section 409A. Accordingly, any such benefits may be granted to eligible partners, members, managers and consultants of the Company. (b) For purposes of Section 409A, and to the extent applicable to any benefit under this Agreement, it is intended that distribution events qualify as permissible distribution events for purposes of Section 409A and shall be interpreted and construed accordingly. Whether a recipient has separated from service or employment will be determined by the Members based on all of the facts and circumstances and, to the extent applicable to any benefit, in accordance with the guidance issued under Section 409A. For this purpose, separation from service shall mean the recipient's death, retirement or other termination of service with the Company and all of its controlled group members within the meaning of Section 409A of the Code; provided, that, a recipient will be presumed to have experienced a separation from service when the level of bona fide services performed permanently decreases to a level less than twenty percent (20%) of the average level of bona fide services performed during the immediately preceding thirty-six (36) month period or such other applicable period as provided by Section 409A. The Company is relying on Q&A 7 in Notice 2005-1 issued by the Internal Revenue Service as well as the Final Regulations issued pursuant to Section 409A on April 10, 2007 located at 72 FR 19234 for guidance indicating that benefits provided to partners of a federal tax partnership who have their ownership interests liquidated are not payments subject to Section 409A. (c) If a recipient is a "specified employee" for purposes of Section 409A and a payment subject to Section 409A (and not excepted therefrom) to the recipient is due upon separation from service, such payment shall be delayed for a period of six (6) months after the date the recipient separates from service (or, if earlier, the death of the recipient). Any payment that would otherwise have been due or owing during such six-month period will be paid immediately following the end of the six-month period unless another compliant date is specified in the applicable agreement. (d) In no event shall the Company (or its employees, partners, members, officers, or directors or affiliates) have any liability to any recipient (or any other Person) due to the failure of any benefit to satisfy the requirements of Section 409A. ARTICLE X BOOKS, RECORDS, REPORTS, AND BANK ACCOUNTS 10.01 Maintenance of Books. The Company shall keep books and records of accounts and shall keep minutes of the proceedings of its Members and each committee of the Members (if any). The calendar year shall be the accounting year of the Company. 10.02 Reports. On or before the 75th day following the end of each fiscal year during the term of the Company, each Member shall be furnished with a balance sheet, an income statement, and a statement of changes in Members' capital of the Company for, or as of the end of, that year prepared by a certified public accountant. These fmancial statements must be prepared in accordance with accounting principles generally employed for cash basis records consistently applied (except as therein noted). The Members also may cause to be prepared or delivered such other reports as they may deem appropriate. The Company shall bear the costs of all of these reports. 10.03 Accounts. The Members shall establish and maintain one or more separate bank and investment accounts and arrangements for Company funds in the Company name with financial institutions and firms that the Members determine. The Members may not commingle the Company's funds with the funds of any Member; provided, however Company funds may be invested in a manner the same as or similar to the Members' investment of their own funds. ARTICLE XI DISSOLUTION, LIQUIDATION, AND TERMINATION 11.01 Dissolution. The Company shall dissolve and its affairs shall be wound up on the first to occur of the following: (a) the written consent of all of the Members; or (b) entry of a decree of judicial dissolution of the Company under the Act. It is expressly understood and agreed that, pursuant to Section 8971(a)(4) of the Act, the following events shall not cause the dissolution of the Company: (i) a Member's becoming bankrupt or executing an assignment for the benefit of creditors; (ii) the death, retirement, resignation, expulsion or dissolution of a Member; or (iii) any other event that terminates the continued membership of a Member. 11.02 Liquidation and Termination. On dissolution of the Company, one or more Members shall act as liquidator(s) as appointed by a Majority Interest of the Members. The liquidator shall proceed diligently to wind up the affairs of the Company and make final distributions as provided herein and in the Act. The costs of liquidation shall be borne as a Company expense. Until final distribution, the liquidator(s) shall continue to operate the Company properties with all of the power and authority of the Members. The steps to be accomplished by the liquidator are as follows: (a) as promptly as possible after dissolution and again after final liquidation, the liquidator(s) shall cause a proper accounting to be made by a recognized firm of certified public accountants of the Company's assets, liabilities, and operations through the last day of the calendar month in which the dissolution occurs or the final liquidation is completed, as applicable; (b) the liquidator(s) shall pay, satisfy or discharge from Company funds all of the debts, liabilities and obligations of the Company (including, without limitation, all expenses incurred in liquidation and any advances described in Section 4.04) or otherwise make adequate 22 provision for payment and discharge thereof (including, without limitation, the establishment of a cash escrow fund for contingent liabilities in such amount and for such term as the liquidator(s) may reasonably determine), all in accordance with Section 8974 of the Act and such other provisions of the Act as may be applicable; and (c) all remaining assets of the Company shall be distributed to the Members as follows: (i) the liquidator(s) may sell any or all Company property, including to Members, and any resulting gain or loss from each sale shall be computed and allocated to the capital accounts of the Members; (ii) with respect to all Company property that has not been sold, the fair market value of that property shall be determined and the capital accounts of the Members shall be adjusted to reflect the manner in which the unrealized income, gain, loss, and deduction inherent in property that has not been reflected in the capital accounts previously would be allocated among the Members if there were a taxable disposition of that property for the fair market value of that property on the date of distribution; and (iii) Company property shall be distributed among the Members in accordance with the positive capital account balances of the Members, as determined after taking into account all capital account adjustments for the taxable year of the Company during which the liquidation of the partnership occurs (other than those made by reason of this clause (iii)); and those distributions shall be made by the end of the taxable year of the Company during which the liquidation of the Company occurs (or, if later, 90 days after the date of the liquidation). All distributions in kind to the Members shall be made subject to the liabilities of each Member receiving a distribution for any costs, expenses, and liabilities theretofore incurred or for which the Company has committed prior to the date of termination and those costs, expenses, and liabilities shall be allocated to the distributees pursuant to this Section 11.02. The distribution of cash and/or property to a Member in accordance with the provisions of this Section 11.02 constitutes a complete return to the Member of its Capital Contributions and a complete distribution to the Member of its Membership Interest and all the Company's property. 11.03 Deficit Capital Accounts. Notwithstanding anything to the contrary contained in this Agreement, and notwithstanding any custom or rule of law to the contrary, to the extent that the deficit, if any, in the capital account of any Member results from or is attributable to deductions and losses of the Company (including non-cash items such as depreciation), or distributions of money pursuant to this Agreement to all Members in proportion to their respective Membership Interest, upon dissolution of the Company such deficit shall not be an asset of the Company and such Members shall not be obligated to contribute such amount to the Company to bring the balance of such Members capital account to zero. 11.04 Certificate of Dissolution. On completion of the distribution of Company assets as provided herein, the Company is terminated, and the Members (or such other person or persons as the Act may require or permit) shall file a Certificate of Dissolution with the 23 Pennsylvania Department of State, cancel any other filings made pursuant to Section 2.05, and take such other actions as may be necessary to terminate the Company ARTICLE XII GENERAL PROVISIONS 12.01 Offset. Whenever the Company is to pay any sum to any Member, whether as an allocation, distribution or otherwise, then any amounts that the recipient Member owes the Company at the time such sum is to be paid may be deducted from that sum before payment is made. 12.02 Notices. Except as expressly set forth to the contrary in this Agreement, all notices, requests, or consents provided for or permitted to be given under this Agreement must be in writing and must be given either by depositing that writing in the United States mail, addressed to the recipient, postage paid, and registered or certified with return receipt requested or by delivering that writing to the recipient in person, by courier, or by facsimile transmission; and a notice, request, or consent given under this Agreement is effective on receipt by the person to receive it. All notices, requests, and consents to be sent to a Member must be sent to or made at the addresses given for that Member on Exhibit A, or such other address as that Member may specify by notice to the other Members. Whenever any notice is required to be given by law, the Certificate or this Agreement, a written waiver thereof, signed by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. 12.03 Entire Agreement. This Agreement constitutes the entire agreement of the Members relating to the Company and supersedes all prior contracts or agreements with respect to the Company, whether oral or written, including (without limitation intended) the Initial Agreement. 12.04 Effect of Waiver or Consent. A waiver or consent, express or implied, to or of any breach or default by any person in the performance by that person of its obligations with respect to the Company is not a consent or waiver to or of any other breach or default in the performance by that person of the same or any other obligations of that person with respect to the Company. Failure on the part of a person to complain of any act of any person or to declare any person in default with respect to the Company, irrespective of how long that failure continues, does not constitute a waiver by that person of its rights with respect to that default until the applicable statute -of -limitations period has run. 12.05 Amendment or Modification. This Agreement may be amended or modified from time to time only by a written instrument adopted, executed and agreed to by an affirmative vote of a Super Majority Interest of the Members. 12.06 Binding Act. Subject to the terms and conditions of this Agreement, this Agreement is binding on and inures to the benefit of the Members and their respective heirs, successors, and personal representatives. 24 12.07 Jurisdiction and Venue. Subject to Section 6.07 above, the parties agree that proper jurisdiction and venue for resolution of any and all disputes hereunder shall only be in the Court of Common Pleas for Dauphin County, Pennsylvania.. 12.08 Governing Law; Severabilitv. This Agreement is governed by and shall be construed in accordance with the laws of the Commonwealth of Pennsylvania, excluding any conflict of laws role or principle that might refer the governance or the construction of this Agreement to the law of another jurisdiction. If any provision of this Agreement or the application thereof to any person or circumstance is held invalid or unenforceable to any extent, the remainder of this Agreement and the application of that provision to other persons or circumstances is not affected thereby and that provision shall be enforced to the greatest extent permitted by law. 12.09 Further Assurances. In connection with this Agreement and the transactions contemplated hereby, each Member shall execute and deliver any additional documents and instruments and perform any additional acts that may be necessary or appropriate to effectuate and perform the provisions of this Agreement and those transactions. 12.10 No Third Party Benefit. The provisions hereof are solely for the benefit of the Company and its Members and are not intended to, and shall not be construed to, confer a right or benefit on any creditor of the Company or any other person. 12.11 Waiver of Certain Rights. Each Member irrevocably waives any right it may have to maintain any action for dissolution of the Company or for partition of the property of the Company. 12.12 Counterparts. This Agreement may be executed in any number of counterparts with the same effect as if all signing parties had signed the same document. All counterparts shall be construed together and constitute the same instrument. [SIGNATURES APPEAR ON FOLLOWING PAGE] 25 IN WITNESS WHEREOF, the undersigned, being all of the Members of the Company, have executed this Amended and Restated Operating Agreement as of the date first set forth above. WITNESS: WITNESS: Chadwick 0. Bogar (SEAL) 26 (SEAL) Limited Liability Company Amended and Restated Operating Agreement Schutjer Bogar LLC Exhibit "A" List of Members, Capital, Percentages, etc., as of August 2010 Initial Membership Name of Member Contribution Percentage Chadwick 0. Bogar Bradley A. Schutjer $ 10opv 50.00% $ , 0 50.00% #5192688 v7;FORSYTH1 $ 20 c 0 CJ 100.00% 27 a1 Releasees in any forum or form. Other than the consideration set forth herein, Brad further affirms that he has been paid and/or has received all leave (paid or unpaid), compensation, wages, bonuses and/or commissions to which he may be entitled and that no other leave (paid or unpaid), compensation, wages, bonuses and/or commissions are due to him, except as provided in this Agreement. 3. Section 6.01 of the Operating Agreement shall be amended to provide the following payout terms for the acquisition of Brad's interest, Schutjer Bogar LLC and/or Chad shall pay to Brad the following payments: a. $15,000 on the 15th of every month beginning on July 15, 2013 and continuing through June 15, 2017; and b. $20,000 on June 15, 2013; and c. $150,000 on July 15, 2017; and d. Brad elects to continue health coverage in accordance with the continuation requirements of COBRA, Chad shall pay the cost of said coverage for a period of twelve (12) months. 5. Schutjer Bogar LLC and/or Chad shall endeavor through good faith efforts with the Bankruptcy Trustee and the Bank to restructure the Firm debt to have Brad removed as a personal guarantor. Likewise, Chad and the firm will assume all outstanding debts, liabilities and contractual agreements of the firm, including a certain business loan of the firm to Metro Bank which has been personally guaranteed by Members. Chad and the firm hereby indemnify and hold Brad harmless for said obligations, including the obligation to Metro Bank. 6. Brad knowingly and voluntarily releases and forever discharges Chad and Schutjer Bogar LLC as well as his/its parent, affiliates, subsidiaries, divisions, predecessor companies, their successors and assigns, their affiliated and predecessor companies and the current and former employees, attorneys, shareholders, members, officers, directors and agents thereof and Chad knowingly and voluntarily releases and forever discharges Brad and Schutjer Bogar LLC as well as his/its parent, affiliates, subsidiaries, divisions, predecessor companies, their successors and assigns, their affiliated and predecessor companies and the current and former employees, attorneys, shareholders, members, officers, directors and agents thereof (collectively referred to throughout the remainder of this Agreement as "Releasees"), of and from any and all claims, demands, liabilities, obligations, promises, controversies, damages, rights, actions and causes of action, known and unknown, which Brad or Chad have or may have against Releasees as of the date of execution of this Agreement, examples include, but are not limited to, any alleged violation of: • Title VII of the Civil Rights Act of 1964, as amended; • The Civil Rights Act of 1991; • Sections 1981 through 1988 of Title 42 of the United States Code, as amended; 2 �{ • • The Employee Retirement Income Security Act of 1974, as amended; • The Immigration Reform and Control Act, as amended; • The Americans with Disabilities Act of 1990, as amended; • The Age Discrimination in Employment Act of 1967, as amended; • The Older Workers Benefit Protect Act; • The Workers Adjustment and Retraining Notification Act, as amended; • The Occupational Safety and Health Act, as amended; • The Equal Pay Act of 1963; • The Genetic Information Nondiscrimination Act; • The Family and Medical Leave Act; • Uniformed Services Employment and Reemployment Rights Act; • The Consolidated Omnibus Budget Reconciliation Act of 1985; • Any other federal, state or local civil or human rights law or any other local, state public policy, contract, tort, or common law; or • Any allegation for costs, fees, or other expenses including attorneys' fees incurred in these matters (all of the above collectively referred to as "Claims"). 7. This release is intended to be a general release, and excludes only those claims under any statute or common law that Members are legally barred from releasing. Members are advised to seek independent legal counsel if they seek clarification on the scope of this release. Signing this Agreement does not waive Members' right to seek a judicial determination of the validity of Members' release of rights arising under the Age Discrimination in Employment Act. 8. Nothing herein is intended to or shall preclude Members from filing a charge with any appropriate federal, state, or local government agency and/or cooperating with said agency in its investigation. Members, however, explicitly waive any right to file a personal lawsuit or receive monetary damages that the agency may recover against Releasees, without regard as to who brought any said complaint or charge, except for matters related to the enforcement of this agreement. 9. Should the firm be acquired, merged or should the assets of the firm be purchased by a third party entity, the buyout of Brad's interest in the firm as set forth herein shall remain an obligation of the acquiring or successor entity to the firm, and the obligations of Chad and the firm to Brad as set forth herein shall remain in full force and effect. Likewise, if Chad becomes employed by an entity which is separate from the firm, or if Chad is otherwise gainfully employed by or consults with an entity other than the firm in substantially the same practice area of the firm, Chad shall be personally liable to Brad for the buyout provisions of this agreement. 10. It is expressly stipulated that in the event that either party breaches any provision of this Agreement, he or she shall be responsible for any and all costs incurred to enforce the Agreement, including, but not limited to, court cost and counsel fees of the other party. In the event of breach, the other party shall have the right, at his or her election; to sue for damages for such breach or to seek such other and additional remedies as may be available to him or her. 3 11. The firm shall maintain life insurance on Chad with sufficient proceeds payable to Brad to ensure performance of this agreement. 12. Neither of the parties shall disparage one another with respect to matters relating to one another's conduct in connection with the operation of the firm and neither shall disclose the terms of this agreement to a third party except as required for bankruptcy Court approval, tax advice and preparation, insurance claims and any similar, related matter. Nothing herein shall restrict either Member's ability to truthfully respond to inquiries posed regarding matters related to this Agreement. Chadwick 0. Bogar J Bra 4 IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA BRADLEY D. SCHUTJER, Plaintiff v. CHADWICK 0. BOGAR and SCHUTJER BOGAR, LLC, Defendants No. 2014-5044 CIVIL ACTION — LAW JURY TRIAL DEMANDED CERTIFICATE OF SERVICE I hereby certify that I am this 6 day of October 2014 serving a true and correct copy of the foregoing document upon the persons and in the manner indicated below, which service satisfies the requirements of the Pennsylvania Rules of Civil Procedure: A) By Deposit in the United States Mail at Harrisburg, Pennsylvania, with first class mail postage, prepaid, as follows: Date: B) By Hand Delivery: Michael A. Scherer, Esq. BARIC SCHERER, LLC 19 West South Street Carlisle, PA 17013 Attorney For Plaintiff Jonathan M. Crist, Esq. 1426 N Third Street, Suite 200 PO Box 5400 Harrisburg PA 17110 Attorney For Schutjer Bogar, LLC. By: Chadwick 0. Bogar, Esj. PRAECIPE FOR LISTING CASE FOR ARGUMENT (Must be typewritten and submitted in. triplicate) TO THE PROTHONOTARY OF CUMBERLAND COUNTY: (List the within matter for the next GA_. -(79._L Argument Court.) CAPTION OF CASE (entire caption must be stated in full) BRADLEY SCHUTJER, Plaintiff vs. CHADWICK BOGAR AND SCHUTJER BOGAR, LLC, Defendants No. 2014-5044 1. State matter to be argued (i.e., plaintiffs motion for new trial, defendant's demurrer to complaint, etc.): Preliminary Objections Of Defendant, Chadwirk O_Rngar and Preliminary Objections Of Defendant, Schutjer Bogar, LLC 2. Identify all counsel who will argue cases: (a) for plaintiffs: Michael A. Scherer, Esq., 19 West South Street, Carlisle, (Name and Address) (b) for defendants: Chadwick 0. Bogar, Esq., 1426 N. Third St., Suite 200, Harrisburg, PA 17110 (Name and Address) Jonathan M. Crist, Esq., 1426 N. Third St., Suite 200, Harrisburg, PA 17110 3. I will notify all parties in writing within two days that this case has been listed for argument. 4. Argument Court Date: December 19 , 2014 Date: November 5, 2014 Signature Michael A. Scherer, Esquire Print your name Plaintiff Attorney for INSTRUCTIONS: 1. Original and two copies of all briefs must be filed with the COURT ADMINISTRATOR (not the Prothonotary) before argument. 2. The moving party shall file and serve their brief 14 days prior to argument. 3. The responding party shall file their brief 7 days prior to argument. 4. If argument is continued new briefs must be filed with the COURT ADMINISTRATOR (not the Prothonotary) after the case is relisted. PA 17013 (a9.75,'" C44,917.77 1- 311017