EFTA01296058.pdf

Corp No. 586644 GOVERNMENT OF THE VIRGIN ISLANDS OF THE UNITED STATES - 0 - CHARLOTTE AMALIE, St THOMAS, VI 00802 CERTIFICATE OF EXISTENCE tro SMU Itto Whom 11Chne reoento *bail Come: OSBERT E POTTER, Lieutenant Governor of the Virgin Islands do hereby certify that I am, by virtue of the laws of the Virgin Islands, the custodian of the corporate records and the proper officer to execute this certificate. I further certify that the records of this office disclose that PRYTANEE, LLC Limited Liability Company was duly registered to conduct business in the Territory on July 22, 2016 and has a legal existence as a Limited Liability Company so far as the records of this office show. Witness my hand and the seal of the Government of the Virgin Islands of the United States, at Charlotte Amalie, St. Thomas, this 5th day of August, 2016. OSBERT E. POTTER Lieutenant Governor of the Virgin Islands SDNY_GM_00057521 CONFIDENTIAL - PURSUANT TO FED. R.CON(F IDENTIAL DB-SDNY-0020345 EFTA_00I 68087 EFTA01296058  ARTICLES OF ORGANIZATION FIE Y OF PRYTANEE, LLC the undersigned natural person of the age of eighteen years or more, acting as organizer of a limited liability company under the Uniform Limited Liability Company Act, Chapter 15, 71tle 13, Virgin Islands Code ("Uniform Limited Liability Company Act"), do hereby adopt the following Articles of Organization for such limited liability company: ARTICLE ONE NAME, ADDRESS AND PRINCIPAL OFFICE Name 1. The name of the limited liability company shall be Prytanee, LLC (the "Company). Address 2. The physical address of the Company is Royal Palms Professional Building, 62-3A & 6238 Estate Thomas, Suite 101, St. Thomas, Virgin Islands 00802. The mailings Artess of the Company is Royal Palms Professional Building, 9053 Estate Thomas, Suttee-4,01a Thomas, Virgin Islands 00802. ..1 IN5 Principal Office 3. The principal office and permanent address for the transaction of business if thiceorrillafiy shall be the addresses stated in Paragraph 2 of these Articles as the physicli) and mialing address of the Company. -4 -.3 Resident Agent and Office 4. The physical address of the Company's initial designated office is Royal Palms Professional Building, 62-3A & 62413 Estate Thomas, Suite 101, St. Thomas, Virgin Islands 00802. The mailing address of the Company's initial designated office is Royal Palms Professional Building, 9053 Estate Thomas, Suite 102, St. Thomas, Virgin Islands 00802. The name of its initial resident agent at such address is Business Basics VI, LLC. The business address of the resident agent and the address of the designated office are identical. SDNY_GM_00057522 CONFIDENTIAL - PURSUANT TO FED. R.CON(F IDENTIAL DB-SDNY-0020346 EFTA_00I 68088 EFTA01296059  ARTICLE TWO PURPOSE The purpose for which the Com pany is organized is to engage in any which a limited liability com and all lawful business for pany may be organized under the Company Act and the other laws of Uniform Limited Liability the US. Virgin Islands. The foregoing paragraph shall be construed as enumerating both Company, and it Is hereby expressly objects and purposes of this provided that the foregoing numerati shall not be held to [lira or restr on of specific purposes ict in any manner the purposes permitted by law. of this Company otherwise ARTICLE THREE DURATION AND CONTINUITY The period of duration of this Com pany shall be perpetual. No member dissolve the Company by his or her shall have the power to independent act of arty kind. ARTICLE FOUR ORGANIZER The name and address of the orga nizer of this Company is: Brett Geary Physical Address: Royal Palms Professio nal Builteng,62-.1A & 62-38 Esta te Thomas, Suite 101, SL ,Vi nllands 00202 Mailing Address: Royal Palms ProfessionaljuarnO60 Estate Thomas. Suite 101. St. Thomas, Virgin islands 02802j: *- C3 M;; ARTICLE FIVE MANAGEMENT' co ' co f-.1 The Company shall be manager man --4 aged. The initial manager of the Sinant. The physical and mailing addr Company shall be Etienne ess of the initial manager of the Com Montaigne, 75008, Paris, France. pany is 60 Avenue ARTICLE SIX CAPITAL The Company shall begin business with capital in the amount of One Thou Dollars (115 $4,000.00). sand United States 2 SDNY_GM_00057523 CONFIDENTIAL - PURSUANT TO FED. R.CONFIDENTIAL DB-SDNY-0020347 EFTA_00168089 EFTA01296060  ARTICLE SEVEN LIMTIATION OE LIABILITY No manager of the Company shall be liable to the Company or its members for monetary damages for an act or an omission in such manager's capacity as a member, except for liability of a manager for (i) a breach of a manager's duty of loyalty to the Company or its members, (fi) an act or omission, not in good faith, that constitutes a breach of duty of a manager to the Company or an act or omission that involves intentional misconduct or a knowing violation of the law, (iii) a transaction from which a manager received an improper benefit, whether or not the benefit resulted from an action taken within the scope of the manager's position, or (iv) an act or omission for which the liability of a manager is expressly provided for by an applicable statute. If the Uniform Limited Liability Company Act or other applicable law is amended to authorize action further eliminating or limiting the liability of managers, then the liability of any manager of the Company shall be eliminated or limited to the fullest extent permitted by the Uniform Limited Liability Company Act or other applicable law, as so amended. Any repeal or modification of the foregoing paragraph by the members shall not adversely affect any right or protection of any manager existing at the time of such repeal or modification. ARTICLE EIGHT MEMBER unsarrt No member of the Company shall be liable for the debts and obligations of the Company under Section 1303, Subsection (c) of the Uniform Limited Liability Company Act. ARTICLE NINE • , $EVERABILITY 17 If any please, clause, sentence, paragraph. or provision of these Articles of OrianfirititiliWield to be void or illegal, then it shall not impair or affect the balance of thestArtipi , apd.:the undersigned Organizer of the Company does hereby declare that she woulcishavrsigrtedciind executed the balance of these Articles without such void or illegal provisions. c-. :" • i - (signature page follows) SDNY_GM_00057524 CONFIDENTIAL - PURSUANT TO FED. R.CON(F IDENTIAL DB-SONY-0020348 EFTA_00 I 68090 EFTA01296061  IN WITNESS WHEREOF, the undersigned person has hereunto set her hand as Organizer of the Company this 22iiei day of July, 2016. IN THE TERRITORY OF THE UNITED STATES VIRGIN ISLANDS UNITED STATES OF AMERICA BEFORE ME, the undersigned authority, on this 22sti day of July, 2016, personally appeared Brett Geary, who, being by me first duly sworn, declared that she is the person who signed the foregoing document as the Organizer of the Company and that the statements contained in these Articles of Organization are true. 7, 4 Cm e." r ; • c in and ftn the Teicituitsf taw United States irgi Islands pc: My commission expires: 11"0 • :-/a : co Gina Marie Bryan Notary Public NP46-I3 Commission Expires 09/05/t7 St.Thornastklohn.USVI 4 SDNY_GM_00057525 CONFIDENTIAL - PURSUANT TO FED. R.CONIF IDENTIAL DB-SONY-0020349 EFTA_00I 6809 I EFTA01296062  PRYTANEE, LLC OPERATING AGREEMENT THIS OPERATING AGREEMENT is made as of the day of November, 2016 by and among Prytande, LLC, a United States Virgin Islands limited liability company (the "Company"), the Company's sole members, Southern Trust Company, Inc., a United States Virgin Islands corporation ("STC"), and The Pierre Trust, a U.S. Virgin Islands trust created pursuant to a Trust Agreement dated November , 2016 by and between Caroline Sophie Camille Lang, as Grantor, and Caroline Sophie Camille Lang, as Trustee (the "Trust", and together with STC, the "Members"), and the Company's Manager, Etienne Binant, an individual with an address at 60 Avenue Montaigne, 75008 PARIS, France (the "Manager). RECITALS A. On July 22, 2016, the Company was formed by the Members by the filing of the Articles of Organization with the Office of the Lieutenant Governor of the United States Virgin Islands. B. The Members and the Manager now desire to enter into this Agreement in order to set forth the respective rights and obligations of the Members and the Manager in regard to the ownership, management and governance of the Company. NOW, THEREFORE, in consideration of the premises and other valuable consideration, the receipt of which is hereby acknowledged, the Members and the Company agree as follows: ARTICLE 1 DEFINED TERMS 1.1 "Act" means the United States Virgin Islands Uniform Limited Liability Company Act, as amended from time to time. 1.2 "Adjusted Capital Account Balance" means, with respect to each Member, such Member's Capital Account balance maintained in accordance with this Agreement, as of the end of the relevant fiscal year of the Company, after giving effect to the following adjustments: (a) Credit to such Capital Account of such Member's share of minimum gain determined in accordance with Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5); and (b) Debit to such Capital Account of the items described in Regulations Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6). SDNY_GM_00057526 CONFIDENTIAL - PURSUANT TO FED. R.QQN(F IDENTIAL DB-SONY-0020350 EFTA_0nl 68092 EFTA01296063  The foregoing definition of -Adjusted Capital Account Balance" is intended to comply with the provisions of Regulations Sections 1.704-1(b)(2)(ii)(d) and 1.704-2, and shall be interpreted consistently therewith. 1.3 'Affiliate" means, with respect to any Person, any other Person that, directly or indirectly, controls, is under common control with, or is controlled by the former Person. For purposes of this definition, 'control" (including, with correlative meaning, the terms "controlled by" and "under common control with"), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct and cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise. 1.4 "Agreement" means this Operating Agreement of the Company, and all amendments thereto. 1.5 "Artwork' means any and all works of art, including, without limitation, paintings, drawings, sculptures, photographs, decorative pieces, and other fine art artwork acquired by the Company. 1.6 'Capital Account" means, with respect to each Member, the Capital Account maintained for such Member in accordance with the following provisions: (a) To each Members Capital Account there shall be credited such Members Capital Contributions, such Member's distributive share of Profits and the amount of any Company liabilities assumed by such Member or which are secured by any property distributed to such Member by the Company. (b) To each Member's Capital Account there shall be debited the amount of cash and the Gross Asset Value of any property distributed to such Member pursuant to any provision of this Agreement, and such Members distributive share of Losses. (c) In the event all or a portion of a Member's Membership Interests are transferred in accordance with the terms of this Agreement, the transferee shall succeed to the Capital Account of the transferor to the extent it relates to the transferred Membership Interests. (d) In determining the amount of any liability for purposes of the foregoing subparagraph (a), there shall be taken into account Code Section 752(c) and any other applicable provisions of the Code and Regulations. The foregoing provisions and the other provisions of this Agreement relating to the maintenance of Capital Accounts are intended to comply with Regulations Sections 1.704-1(b) and 1.704.2, and shall be interpreted and applied in a manner consistent with such Regulations. In the event the Members acting unanimously shall reasonably determine that it is prudent to modify the manner in which the Capital Accounts, or any debits or credits thereto, are computed in order to comply with such Regulations, the Manager, with the Consent of the Members, may make such 2 SDNY_GM_00057527 CONFIDENTIAL - PURSUANT TO FED. R.QQN(F IDENTIAL D8-SONY-0020351 EFTA_00168093 EFTA01296064  modification; provided that such modification is not likely to have a material effect on the amount distributed to any Member pursuant to Article 10 hereof upon the liquidation of the Company. 1.7 "Capital Contributions" means the aggregate amount of cash and Gross Asset Value of property (less the amount of Indebtedness, if any, of such Member which is assumed by the Company and/or the amount of indebtedness, if any, to which such property is subject, as of the date of contribution, without regard to the provisions of Code Section 7701(g)) contributed by a Member to the capital of the Company. 1.8 "Cash Flow means, for any period, the amount by which (a) the gross cash receipts of the Company from any source for such period (including, but not limited to, Capital Contributions, loans, proceeds received by the Company in respect of the any and all realizations of any Artwork, and proceeds from the sale, financing. refinancing or other disposition of all or any portion of any other property of the Company), exceed (b) the sum of (i) the aggregate cash disbursements for such period (including, but not limited to, Company administrative costs, reimbursements paid to the Manager in accordance with the provisions of this Agreement with respect to expenses Incurred by Manager in the day-to-day activities of managing and operating the Company hereunder, principal and interest payable on Company debt and capital expenditures), and (ii) amounts previously set aside as reserves as determined by the Consent of the Members. 1.9 "Certificate" means the Articles of Organization of the Company, as amended from time to time, as filed in accordance with the Act. 1.10 "Code" means the Internal Revenue Code of 1986, as amended (or any corresponding provision of succeeding law). 1.11 "Company" means the limited liability company herein formed and known as Prytanee, LLC, as said Company may from time to time be constituted. 1.12 "consent" means the prior written consent or approval of a Person or Persons to do the act or thing for which the consent or approval is solicited, or the act of granting such consent or approval as the context may require. 'Consent of the Members" means the prior written consent or approval of Members of the Company holding 51% of the Membership Interests, and, for so long as STC shall remain a Member of the Company, shall include the Consent of STC. 1.13 "Depredation" means, for each fiscal year or other period, an amount equal to the depreciation, amortization or other cost recovery deduction allowable with respect to an asset for such year or other period, except that if the Gross Asset Value of an asset differs from its adjusted basis for federal income tax purposes at the beginning of such year or other period, Depreciation shall be an amount which bears the same ratio to such beginning Gross Asset Value as the federal income tax depreciation, amortization or other cost recovery deduction for such year or other period bears to such beginning adjusted tax basis; provided, however, that if the federal income tax 3 SDNY_GM_O0057528 CONFIDENTIAL - PURSUANT TO FED. R.Q11;)N(F IDENTIAL DB-SDNY-0020352 EFTA_00168094 EFTA01296065  depreciation, amortization or other cost recovery deduction from such year or other period is zero, Depredation shall be determined with reference to such beginning Gross Asset Value using any reasonable method selected by the Consent of the Members. 1.14 "Gross Asset Value' means. with respect to any asset, the asset's adjusted basis for federal income tax purposes, except as follows: (a) The initial Gross Asset Value of any asset contributed by a Member to the Company shall be the gross fair market value of such asset, as determined by the contributing Member and the Manager: (b) The Gross Asset Values of all Company assets shall be adjusted to equal their respective gross fair market values, as reasonably determined by the Consent of the Members, as of the following times: (i) the acquisition of additional Membership Interests in the Company by any new or existing Member in exchange for more than a de minimis capital contribution; (ii) the distribution by the Company to a Member of more than a de minimis amount of Company assets, including money, as consideration for an interest in the Company: and (iii) the liquidation of the Company within the meaning of Regulations Section 1.704-1(b)(2)(ii)(g); provided, however, that adjustments pursuant to the preceding clauses (i) and (ii) shall be made only if it is reasonably determined by the Consent of the Members that such adjustments are necessary or appropriate to reflect the relative economic interests of the Members in the Company; (c) The Gross Asset Value of any Company asset distributed to any Member shall be the gross fair market value of such asset on the date of distribution; and (d) The Gross Asset Values of Company assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m) and the definition of "Capital Account" herein. If the Gross Asset Value of an asset has been determined or adjusted pursuant to any of the foregoing subparagraphs (a), (b) or (d) of this Section, such Gross Asset Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses. 1.15 "Manager" means the Person designated or appointed as Manager pursuant to this Agreement, and any other Person who becomes a successor or additional Manager of the Company pursuant to this Agreement. 1.16 "Member means either STC or the Trust as and when acting in such Person's capacity as a Member of the Company, and any other Persons who from time to time become parties to or are otherwise bound by this Agreement as Members. 4 SDNY_GM_00057529 CONFIDENTIAL - PURSUANT TO FED. R.QPN(F IDENTIAL DB-SDNY-0020353 EFTA_00168095 EFTA01296066  1.17 "Membership Interest" means an ownership interest of a Member in the Company at any particular time, including the right of such Member to any and all benefits to which a Member may be entitled pursuant to this Agreement and under the Act, together with all obligations of such Member to comply with the terms and provisions of this Agreement and the Act. Membership Interests are owned by Members as set forth in Exhibit A to this Agreement, as amended from time to time. 1.18 "Notice" means a writing, containing the information required by this Agreement to be communicated to any Person, and given or delivered in accordance with the requirements of this Agreement. 1.19 "Persgn" means any individual, partnership, limited liability company, corporation, trust, estate or other entity. 1.20 "Profits" and tosses" means, for each fiscal year or other period, an amount equal to the Company's taxable income or loss for such year or period, determined in accordance with Code Section 703(a) (for this purpose, all items of income, gain, loss or deduction required to be stated separately pursuant to Code Section 703(aX1) shall be included in taxable income or loss), with the following adjustments: (a) Any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Profits or Losses pursuant to this definition shall be added to such taxable income or loss; (b) Any expenditures of the Company described in Code Section 705(a)(2)(8), or treated as Code Section 705(a)(2)(8) expenditures pursuant to Regulations Section 1.704.1(b)(2)(iv)(I), and not otherwise taken into account in computing Profits or Losses pursuant to this definition shall be subtracted from such taxable income or loss; (c) In the event the Gross Asset Value of any Company asset is adjusted pursuant to subparagraph (b) or (d) of Section 1.14 hereof, the amount of such adjustment shall be taken into account as gain or loss from the disposition of such asset for purposes of computing Profits or Losses; (d) Gain or loss resulting from any disposition of property with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Gross Asset Value of the property disposed of notwithstanding that the adjusted tax basis of such property differs from its Gross Asset Value; and (e) Depreciation shall be taken into account for such fiscal year or other period in computing such taxable income or loss, in lieu of the depreciation, amortization and other cost recovery deductions that otherwise may be taken into account in the absence of Section 1.13. 1.21 "Regulations" means the United States Treasury Regulations, as 5 SDNY_GM_00057530 CONFIDENTIAL - PURSUANT TO FED. R.QPN(F IDENTIAL DB-SONY-0020354 EFTA_00I 68096 EFTA01296067  amended from time to time. 1.22 "Transfer" has the meaning set forth in Section 9.1. 1.23 "Unretumed Capital Contributions" means, with respect to any Member, the difference between (a) the Capital Contributions made by such Member, less (b) the aggregate amount of distributions made to such Member pursuant to Section 4.6(a). ARTICLE 2 THE COMPANY 2.1 Formation and Name. The Company has been formed as a limited liability company pursuant to the provisions of the Act. The Company was formed with the name "Prytanee, LLC"; provided that the Company may hereafter adopt such other name or names as may from time to time selected by the Consent of the Members. 2.2 Purpose. The Company has been organized to engage in the acquisition, ownership and management for investment purposes of Artwork selected from time to time by the Manager, subject to the provisions of Section 5,2 hereof and the other provisions of this Agreement; provided, however, that the Company shall not at any given time invest in the aggregate amounts in excess of One Hundred Thousand Dollars (5100,000.00) on Artwork created by any single artist; and, with the Consent of the Members, the Company may engage in any and all other lawful businesses or activities which a limited liability company may carry on under the Act and the laws of any other jurisdiction in which the Company is so engaged. 2.3 Registered Agent. The Company's registered agent shall initially be Business Basics VI, LLC, Royal Palms Professional Building, 62-3A & 62-38 Estate Thomas, Suite 101, St. Thomas, U.S. Virgin Islands 00802, and from time to time hereafter may be changed to the Person designated by the Consent of the Members to serve in that capacity In accordance with the terms of the Act. 2.4 Qualification in Additional Jurisdictions. The Manager is authorized, with the Consent of the Members, to qualify the Company to do business in any jurisdiction in which such qualification is deemed by the Manager as necessary or desirable in carrying out the Company's business, and pursuant thereto, to appoint a registered agent and to establish a registered office in such jurisdiction, and to cause the Company to operate In such jurisdiction under another name selected by the Consent of the Members, in compliance with the assumed name statute of such jurisdiction, if the Company is not allowed under the laws of such jurisdiction to operate under its legal name. ARTICLE 3 MEMBERSHIP INTERESTS' CONTRIBUTIONS BY THE MEMBERS 6 SDNY_GM_00057531 CONFIDENTIAL - PURSUANT TO FED. R.CON(F IDENTIAL DB-SDNY-0020355 EFTA_00I 68097 EFTA01296068  3.1 Membership Interests. The Company shall issue one type of ownership interest, with such rights, preferences and obligations as set forth in this Agreement. Holders of Membership Interests shall be entitled to one vote per each percentage point of Membership Interest held; provided that such holder is also a Member, Notwithstanding anything to the contrary contained in this Agreement, no Person shall be entitled to vote with respect to any Membership Interests unless such person is a Member. 3.2 Initial Capital of the Company. On or prior to the date hereof, each of the Members (or the Person from whom such Member acquired, directly or indirectly, its, his or her Membership Interests) has made an initial Capital Contribution to the Company as provided on Exhibit A attached hereto. In consideration of the provisions contained in this Agreement, each Member (or the Person from whom such Member acquired, directly or indirectly, its, his or her Membership Interests) has received that percentage of Membership Interests set forth on such Exhibit A. 3.3 No Additional Capital Contributions. No Member shall be required to make any additional Capital Contribution to the Company; provided, however, that STC may from time to time in its sole discretion make additional Capital Contributions to the Company so as to enable the Company to invest in additional Artwork or for any other purposes that STC, in its sole discretion, deems necessary or appropriate. Such additional Capital Contributions shall increase STC's Capital Account in accordance with the provisions of Section 1.7 hereof, but without the Consent of the Members shall not increase the percentage Membership Interest of STC. 3.4 Withdrawal. Except as otherwise provided in Article 9 of this Agreement, no Member shall be entitled to withdraw or resign from the Company, prior to its dissolution and winding up, without first obtaining the Consent of the Members. 3.5 Additional Membership Interests. No additional Membership Interests shall be issued by the Company without the Consent of the Members. ARTICLE 4 CAPITAL ACCOUNTS; PROFITS AND LOSSES; DISTRIBUTIONS 4.1 Capital Accounts. The Company shall establish and maintain a Capital Account for each Member. 4.2 Allocation of Profits and Losses. (a) Profits of the Company shall be allocated among the Members as follows: (i) First, to each Member pro rata and in proportion to the cumulative Losses, if any, allocated to such Member pursuant to Section 4.2(b)(ii) hereof until the cumulative Profits allocated to such 7 SDNY_GM_00057532 CONFIDENTIAL - PURSUANT TO FED. R.QQN(F IDENTIAL DB-SDNY-0020356 EFTA_00168098 EFTA01296069  Member under this Section 4.2(a)(i) equals the cumulative Losses allocated to such Member under Section 4.2(b)(i) hereof; and (ii) Then, the balance, if any, to the Members In accordance with their respective Membership Interests. (b) Losses of the Company shall be allocated to the Members as follows: (i) First, to the Members in accordance with their respective Membership Interests; provided, however, that no Member shall be allocated Losses in excess of its, his or her Adjusted Capital Account Balance, determined immediately prior to the allocation provided for in this Section 4.2(b)(i); and (ii) Then, to the extent any Losses allocated to a Member pursuant to Section 4.2(b)(i) would, but for the proviso contained therein, exceed a Members Adjusted Capital Account Balance, such Losses shall be allocated first to the other Members in proportion to, and to the extent of, their respective Adjusted Capital Account Balances, and then to any Member guaranteeing debt of the Company, making loans to the Company or otherwise having liability for Company debt, in proportion to the debt guaranteed, the loans made or the amount of such liability. 4.3 Reallocation by Manager. The allocation of Profits and Losses in Section 4.2 is intended to have substantial economic effect within the meaning of Regulations Section 1.704-1(b)(2) or be in accordance with the Members' interests In the Company within the meaning of Regulations Section 1.704-1(b)(4). If subsequent events (including, but not limited to, nonrecourse borrowing by the Company or a loan by a Member to the Company) cause, in the reasonable opinion of the Members as determined by the Consent of the Members, the Section 4.2 allocations to have neither substantial economic effect nor be In accordance with the Members' interests in the Company, the Manager may (a) allocate the income, gain, loss, deduction and credit of the Company so that such allocations are in accordance with the Members' Membership Interests; or (b) make such other modifications to this Agreement (including, but not limited to, the addition of minimum gain chargeback, qualified income offset and other special allocation provisions specified in Regulations Sections 1.704-2 or 1.704.1(b)) that are necessary in the reasonable opinion of the Members to cause such allocations to have substantial economic effect within the meaning of Regulations Section 1.704 1(b)(2 ). 4.4 Tax Allocations. Except as otherwise provided in this Agreement, all items of income, gain, loss and deduction shall be allocated, for federal, territorial, state, local and other jurisdiction income tax purposes, among the Members in the same manner as the corresponding items of income, gain, loss and deduction are allocated for purposes of maintaining the Capital Account of each of the Members. B SDNY_GM_00057533 CONFIDENTIAL - PURSUANT TO FED. R.QQN(F IDENTIAL DB-SDNY-0020357 EFTA_00I 68099 EFTA01296070  4.5 Section 704(c) Allocations. In accordance with Code Section 704(c) and the Regulations thereunder, income, gain, loss and deduction with respect to any property contributed to the capital of the Company shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of such property to the Company for federal income tax purposes and Its initial Gross Asset Value, including, but not limited to, special allocations to a contributing Member that are required under Code Section 704(c) to be made upon distribution of such property to any of the noncontributing Members. In the event the Gross Asset Value of any property of the Company is adjusted pursuant to subparagraph (b) of Section 1.14, subsequent allocations of income, gain, loss and deduction with respect to such property shall take account of any variation between the adjusted basis of such property for federal income tax purposes and its Gross Asset Value in the same manner as under Code Section 704(c) and the Regulations thereunder. Any elections or other decisions relating to such allocations shall be made by the Manager with the Consent of the Members in any manner that reasonably reflects the purpose and intention of this Agreement. Allocations pursuant to this Section 4.5 are solely for purposes of federal, state, territorial, local and other jurisdiction taxes and shall not affect, or in any way be taken into account in computing, a Members Capital Account or share of Profits or Losses, other items or distributions pursuant to any provision of this Agreement. 4,6 Distribution of Cash Flow. To the extent there is Cash Flow available for distribution, as reasonably determined by the Consent of the Members, and in any event not later than 45 days after the receipt by the Company of the proceeds from the sale of any Artwork, the Manager shall cause the Company to distribute such available Cash Flow: (a) first, to those Members with Unreturned Capital Contributions, pro rata in proportion to the amount of such Unretumed Capital Contributions, until the amount of each Member's Unretumed Capital Contributions has been reduced to zero; and (b) thereafter, to the Members, pro rata in accordance with their respective Membership Interests. ARTICLE 5 MANAGEMENT 5.1 Initial .Manager. The management of the Company's business shall be vested in one Manager unless a greater number of Managers shall be fixed from time to time by the Consent of the Members. The initial Manager of the Company shall be Etienne Binant. A Manager shall hold office until his, her or its death, removal, or resignation. The Company shall enter into a Management Agreem