LIMITED LIABILITY COMPANY AGREEMENT
OF
TRC-MRC 2, LLC

THIS SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE
COMMISSION UNDER THE SECURITIES ACT OF 1933, 15 U.S.C. § 15b ET SEQ., AS AMENDED
(THE "FEDERAL ACT"), IN RELIANCE UPON ONE (1) OR MORE EXEMPTIONS FROM THE
REGISTRATION REQUIREMENTS OF THE FEDERAL ACT. IN ADDITION, THE ISSUANCE OF THIS
SECURITY HAS NOT BEEN QUALIFIED UNDER THE DELAWARE SECURITIES ACT, THE
CALIFORNIA CORPORATE SECURITIES LAW OF 1968 OR ANY OTHER STATE SECURITIES LAWS
(COLLECTIVELY, THE "STATE ACTS"), IN RELIANCE UPON ONE (1) OR MORE EXEMPTIONS
FROM THE REGISTRATION PROVISIONS OF THE STATE ACTS. IT IS UNLAWFUL TO CONSUMMATE
A SALE OR OTHER TRANSFER OF THIS SECURITY OR ANY INTEREST THEREIN TO, OR TO
RECEIVE ANY CONSIDERATION THEREFOR FROM, ANY PERSON OR ENTITY WITHOUT THE
OPINION OF COUNSEL FOR THE COMPANY THAT THE PROPOSED SALE OR OTHER TRANSFER OF
THIS SECURITY DOES NOT AFFECT THE AVAILABILITY TO THE COMPANY OF SUCH EXEMPTIONS
FROM REGISTRATION AND QUALIFICATION, AND THAT SUCH PROPOSED SALE OR OTHER
TRANSFER IS IN COMPLIANCE WITH ALL APPLICABLE STATE AND FEDERAL SECURITIES LAWS.
THE TRANSFER OF THIS SECURITY IS FURTHER RESTRICTED UNDER THE TERMS OF THE
LIMITED LIABILITY COMPANY AGREEMENT GOVERNING THE COMPANY, A COPY OF WHICH IS ON
FILE WITH THE COMPANY.

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ARTICLE I
 
FORMATION
1
1.01
 
Formation
1
1.02
 
Names and Addresses
1
1.03
 
Nature of Business
1
1.04
 
Term of Company
2
ARTICLE II
 
MANAGEMENT OF THE COMPANY
2
2.01
 
Formation of Executive Committee
2
2.02
 
Committee Procedures
2
2.03
 
Administrative Member
5
2.04
 
Approval of Major Decisions
5
2.05
 
Consents and Approvals
9
2.06
 
Approved Business Plan
9
2.07
 
Operating Budget
10
2.08
 
Marketing and Leasing Management
10
2.09
 
Property Management
11
2.1
 
Authority with Respect to the Affiliate Agreements
11
2.11
 
Election, Resignation, Removal of the Administrative or Property Manager Member
11
2.12
 
Officers
13
2.13
 
Management Fees
14
2.14
 
Treatment of Payments
14
2.15
 
Reimbursement and Fees
14
2.16
 
Insurance
15
ARTICLE III
 
MEMBERS' CONTRIBUTIONS TO COMPANY
15
3.01
 
Initial Capital Contributions of the Members
15
3.02
 
Additional Capital Contributions
15
3.03
 
Remedy for Failure to Contribute Capital
15
3.04
 
Financing
19
3.05
 
Agreement to Provide Guarantees and Indemnification
20
3.06
 
Capital Contributions in General
21
ARTICLE IV
 
ALLOCATION OF PROFITS AND LOSSES
21
4.01
 
Net Losses
21
4.02
 
Net Profits
21
4.03
 
Special Allocations
22
4.04
 
Curative Allocations
22
4.05
 
Differing Tax Basis; Tax Allocation
23
ARTICLE V
 
DISTRIBUTION OF CASH FLOW
23
5.01
 
Cash Flow
23
5.02
 
Limitations on Distributions
23
5.03
 
Withholding
23
5.04
 
In-Kind Distribution
23
ARTICLE VI
 
RESTRICTIONS ON TRANSFERS OF COMPANY INTERESTS
24

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6.01
 
Limitations on Transfer
24
6.02
 
Permitted Transfers
24
6.03
 
Admission of Substituted Members
26
6.04
 
Election; Allocations between Transferor and Transferee
26
6.05
 
Partition
27
6.06
 
Waiver of Withdrawal and Purchase Rights
27
6.07
 
No Appraisal Rights
27
6.08
 
Foreclosure of Interest
27
ARTICLE VII
 
MEMBER DEFAULT
28
7.01
 
Default Events
28
7.02
 
Rights Arising From a Default Event
29
7.03
 
Determination of Defaulting Member's Purchase Price
29
7.04
 
Non-Defaulting Members' Option
31
7.05
 
Closing Adjustments
31
7.06
 
Closing of Purchase and Sale
31
7.07
 
Representations and Warranties
32
7.08
 
Payment of Defaulting Member's Purchase Price
32
7.09
 
Repayment of Default Loans
32
7.1
 
Release and Indemnity
33
7.11
 
Withdrawal of the Defaulting Member
33
7.12
 
Distribution of Reserves
33
ARTICLE VIII
 
ELECTIVE BUY/SELL AGREEMENT
34
8.01
 
Buy/Sell Election
34
8.02
 
Determination of the Purchase Price
34
8.03
 
Non-Electing Member's Option
34
8.04
 
Deposit
35
8.05
 
Closing Adjustments
36
8.06
 
Closing of Purchase and Sale
36
8.07
 
Representations and Warranties
36
8.08
 
Repayment of Default Loans
37
8.09
 
Release and Indemnity
37
8.1
 
Interim Event of Default
37
8.11
 
Application of Provisions
38
ARTICLE IX
 
REPRESENTATIONS, WARRANTIES, COVENANTS AND OTHER MATTERS
38
9.01
 
Tejon Representations
38
9.02
 
Majestic Representations
40
9.03
 
Brokerage Fee Representation and Indemnity
42
9.04
 
Investment Representations
42
9.05
 
Indemnification Obligations
43
9.06
 
Survival of Representations, Warranties and Covenants
44

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ARTICLE X
 
LIABILITY, EXCULPATION, RESTRICTIONS ON COMPETITION, FIDUCIARY DUTIES AND
INDEMNIFICATION
44
10.01
 
Liability for Company Claims
44
10.02
 
Exculpation, Indemnity and Reliance on Information
44
10.03
 
Limitation on Liability
45
10.04
 
Activities of the Members and Their Affiliates
46
10.05
 
Fiduciary Duties
46
10.06
 
Non-Exclusivity of Rights
47
10.07
 
Amendment or Repeal
47
10.08
 
Insurance
47
ARTICLE XI
 
BOOKS AND RECORDS
47
11.01
 
Books of Account and Bank Accounts
47
11.02
 
Tax Returns
48
ARTICLE XII
 
DISSOLUTION AND WINDING UP OF THE COMPANY
49
12.01
 
Events Causing Dissolution of the Company
49
12.02
 
Winding Up of the Company
50
12.03
 
Negative Capital Account Restoration
51
ARTICLE XIII
 
MISCELLANEOUS
51
13.01
 
Amendments
51
13.02
 
Waiver of Conflict Interest
51
13.03
 
Partnership Intended Solely for Tax Purposes
51
13.04
 
Notices
52
13.05
 
Construction of Agreement
52
13.06
 
Counterparts
52
13.07
 
Attorneys' Fees
53
13.08
 
Approval Standard
53
13.09
 
Further Acts
53
13.1
 
Preservation of Intent
53
13.11
 
Waiver
53
13.12
 
Entire Agreement
54
13.13
 
Choice of Law
54
13.14
 
No Third-Party Beneficiaries
54
13.15
 
Successors and Assigns
54
13.16
 
No Usury
54
13.17
 
Venue
55
13.18
 
Dispute Resolution
55
13.19
 
Timing
58
13.2
 
Remedies for Breach of this Agreement
58
13.21
 
Survivability of Representations and Warranties
58
13.22
 
Reasonableness of Rights and Remedies
58
13.23
 
Force Majeure
59

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ARTICLE XIV
 
DEFINITIONS
59
14.01
 
Accountant's Notice
59
14.02
 
Accounting Firm
59
14.03
 
Acquisition Loan
59
14.04
 
Actual Knowledge of Majestic
59
14.05
 
Actual Knowledge of Tejon
59
14.06
 
Adjusted Accountant's Notice
60
14.07
 
Adjusted Capital Account
60
14.08
 
Adjusted Price Determination Notice
60
14.09
 
Administrative Member
60
14.1
 
Affiliate
60
14.11
 
Affiliate Agreements
60
14.12
 
Affiliated Parties
60
14.13
 
Agreement
60
14.14
 
Appraised Value
60
14.15
 
Approved Business Plan
61
14.16
 
Arbitration Notice
61
14.17
 
Book Basis
61
14.18
 
Brown
61
14.19
 
Business Day
61
14.2
 
California Act
61
14.21
 
Capital Account
61
14.22
 
Capital Call Notice
62
14.23
 
Cash Flow
62
14.24
 
Certificates
62
14.25
 
Code
62
14.26
 
Company
62
14.27
 
Contributing Member
62
14.28
 
Contributing Party
62
14.29
 
Contribution Date
62
14.3
 
Covered Persons
63
14.31
 
Default Events
63
14.32
 
Default Loan
63
14.33
 
Default Notice
63
14.34
 
Defaulting Member
63
14.35
 
Defaulting Member's Purchase Price
63
14.36
 
Delaware Act
63
14.37
 
Delinquent Contribution
63
14.38
 
Deposit
63
14.39
 
Dilution Percentage
63
14.4
 
Effective Date
63
14.41
 
Electing Member
63

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14.42
 
Election Notice
64
14.43
 
Enforceability Exceptions
64
14.44
 
Executive Committee
64
14.45
 
FAA
64
14.46
 
Fiscal Year
64
14.47
 
Force Majeure Delay
64
14.48
 
Gross Asset Value
64
14.49
 
Guarantor(s)
65
14.5
 
Hypothetical Distribution
65
14.51
 
Impasse Event
65
14.52
 
Improvements
65
14.53
 
Initial Contribution
65
14.54
 
Interest
65
14.55
 
JAMS
65
14.56
 
Just Cause Event
65
14.57
 
Lender(s)
65
14.58
 
Liquidation
66
14.59
 
Loan Documents
66
14.6
 
Loans
66
14.61
 
Lockout Date
66
14.62
 
Losses
66
14.63
 
Lyda
66
14.64
 
Majestic
66
14.65
 
Majestic Group
66
14.66
 
Major Decisions
66
14.67
 
Management Fee
66
14.68
 
Marketing Plan
66
14.69
 
McMahon
67
14.7
 
Member(s)
67
14.71
 
MRC
67
14.72
 
Net Profits and Net Losses
67
14.73
 
Non-Contributing Member
67
14.74
 
Non-Contributing Party
67
14.75
 
Non-Defaulting Member
67
14.76
 
Non-Electing Member
67
14.77
 
Nonrecourse Parties
67
14.78
 
Obligated Member
68
14.79
 
OFAC
68
14.8
 
Officers
68
14.81
 
Operating Budget
68
14.82
 
Partially Adjusted Capital Account
68
14.83
 
Percentage Interest
68
14.84
 
Permanent Loan
68

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14.85
 
Permitted Transferees
68
14.86
 
Person
68
14.87
 
Price Determination Notice
68
14.88
 
Pro Rata Share
69
14.89
 
Project
69
14.9
 
Property
69
14.91
 
Property Manager Member
69
14.92
 
Purchase Notice
69
14.93
 
Purchase Price
69
14.94
 
Quorum
69
14.95
 
Real Estate Assets
69
14.96
 
Regulatory Allocations
69
14.97
 
Removal Notice
69
14.98
 
Representative(s)
69
14.99
 
Response Period
69
14.1
 
Roski
70
14.101
 
Roski Family
70
14.102
 
Rules
70
14.103
 
Securities Acts
70
14.104
 
Shortfall
70
14.105
 
Stated Value
70
14.106
 
Target Capital Account
70
14.107
 
Tejon
70
14.108
 
Tejon Group
70
14.109
 
Transfer
70
14.11
 
Treasury Regulation
71
14.111
 
Unreturned Contribution Account
71

EXHIBITS
Exhibit "A"
Names, Addresses, Percentage Interests and Initial Cash Contributions of the
Members

Exhibit "B"
Legal Description of the Property

Exhibit "C"
Approved Business Plan

Exhibit "D"
Right of First Refusal

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LIMITED LIABILITY COMPANY AGREEMENT
OF
TRC-MRC 2, LLC
THIS LIMITED LIABILITY COMPANY AGREEMENT OF TRC-MRC 2, LLC, is entered into
effective as of August 6, 2016 (the "Effective Date"), by and between TEJON
ENERGY LLC, a California limited liability company ("Tejon"), and MAJESTIC
TEJON II, LLC, a Delaware limited liability company ("Majestic"). The
capitalized terms used herein shall have the respective meanings assigned to
such terms in Article XIV.
ARTICLE I
FORMATION
1.01    Formation
The Members hereby form a Delaware limited liability company pursuant to the
provisions of the Delaware Act and this Agreement. In connection therewith, the
Administrative Member, as an authorized person of the Company, shall execute
(i) a Certificate of Formation for the Company in accordance with the Delaware
Act, which shall be duly filed with the Office of the Delaware Secretary of
State, and (ii) a Limited Liability Company Application for Registration (Form
LLC‑5), which shall be duly filed with the Office of the California Secretary of
State. The Administrative Member shall also execute, acknowledge and/or verify
such other documents and/or instruments as may be necessary and/or appropriate
to form the Company under the Delaware Act, to continue its existence in
accordance with the provisions of the Delaware Act and/or to register, qualify
to do business and/or operate its business in California as a foreign limited
liability company in accordance with the provisions of the California Act.
1.02    Names and Addresses
The name of the Company is "TRC-MRC 2, LLC." The registered office of the
Company in the State of Delaware shall be at 850 New Burton Road, Suite 201,
Dover, Delaware 19904. The name and address of the registered agent for the
Company in the State of Delaware shall be National Corporate Research, Ltd., 850
New Burton Road, Suite 201, Dover, Delaware 19904. The name and address of the
registered agent for the Company in the State of California shall be Michael
Durham, c/o Majestic Realty Co., 13191 Crossroads Parkway North, 6th Floor, City
of Industry, California 91746-3497. The principal office of the Company shall be
at 13191 Crossroads Parkway North, 6th Floor, City of Industry, California
91746-3497. The names and addresses of the Members are set forth on Exhibit "A"
attached hereto.
1.03    Nature of Business
The express, limited and only purposes for which the Company is to exist are
(i) to acquire that certain real property consisting of approximately
thirty-three and 29/100ths (33.29) gross acres of land located within the Tejon
Ranch Commerce Center at 4049 Industrial Parkway Drive, in the City of Lebec,
County of Kern, State of California, and described more particularly on
Exhibit "B" attached hereto (the "Property"), which is

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improved with an industrial building containing approximately six hundred
fifty-one thousand nine hundred nine (651,909) square feet of space and other
improvements appurtenant thereto (collectively, the "Improvements"), (ii) to
own, lease, maintain, manage, finance, refinance, hold for long-term investment,
market, sell, exchange, transfer and otherwise realize the economic benefit from
the Property and the Improvements (collectively, the "Project"), and (iii) to
conduct such other activities with respect to the Project as are necessary
and/or appropriate to carrying out the foregoing purposes and to do all things
incidental to or in furtherance of the above enumerated purposes.
1.04    Term of Company
The term of the Company shall commence on the date the Certificate of Formation
for the Company is filed with the Office of the Delaware Secretary of State, and
shall continue in perpetuity, unless dissolved sooner pursuant to Article XII or
unless extended by the Executive Committee. The existence of the Company as a
separate legal entity shall continue until the cancellation of the Company's
Certificate of Formation.
ARTICLE II
    
MANAGEMENT OF THE COMPANY
2.01    Formation of Executive Committee
(a)    Executive Committee Matters. Any matter requiring the consent or approval
of the Members under this Agreement shall be made by the Members acting through
an executive committee (the "Executive Committee") in accordance with the
provisions of this Section 2.01 and Section 2.02. The Executive Committee shall
also be responsible for establishing the policies and procedures to be followed
by the Administrative Member.
(b)    Composition of the Executive Committee. The Executive Committee shall be
composed of four (4) representatives (individually, a "Representative" and
collectively, the "Representatives"). Each Member shall appoint two (2)
Representatives to the Executive Committee. Tejon hereby appoints Allen Lyda
("Lyda") and Hugh McMahon ("McMahon") as its initial Representatives. Majestic
hereby appoints Brett Tremaine and Thomas Simmons as its initial
Representatives. If the initial or replacement Representative of any Member
ceases to serve, then such Member shall replace its Representative with a new
Representative. Any replacement Representative appointed by a Member pursuant to
the preceding sentence shall be subject to the approval of the other Member,
which approval shall not be unreasonably withheld, conditioned or delayed. The
authorized number of Representatives on the Executive Committee may be increased
or decreased only with the prior written approval of both Members.
2.02    Committee Procedures
(a)    Quorum. A "Quorum" for the Executive Committee shall be the presence of
at least one (1) Representative of each Member. In the absence of a Quorum, the
Representative(s) of the Executive Committee so present may adjourn the meeting
until a Quorum is present. The Executive

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Committee shall meet at least quarterly on a day designated by the
Administrative Member. The Executive Committee shall hold such other regularly
scheduled meetings as are determined by the Administrative Member. Meetings
shall be held on a Business Day at the principal executive office of the Company
during normal business hours, unless otherwise agreed to by the Executive
Committee. Notice of any regularly scheduled meeting of the Executive Committee
shall be given by the Administrative Member to all of the Representatives no
fewer than ten (10) days and no more than thirty (30) days prior to the date of
any such meeting. Any Representative may participate telephonically in any
regular meeting of the Executive Committee. The attendance of a Representative
of the Executive Committee at a regularly scheduled meeting of the Executive
Committee (either in person or telephonically) shall constitute a waiver of
notice of such meeting, except where a Representative of the Executive Committee
attends a meeting for the express purpose of objecting to the transaction of any
business because the meeting was not properly called or convened. Minutes of the
Executive Committee shall not be required to be prepared or maintained.
Resolutions of the Executive Committee, when signed by a Quorum present at the
applicable meeting, shall be binding and conclusive evidence of the decisions
reflected therein and any authorization granted thereby.
(b)    Decisions of the Executive Committee. Subject to Section 2.02(f), all
decisions and actions of the Executive Committee shall require the affirmative
vote of (i) a majority of the Representatives present at such meeting, and
(ii) at least one (1) Representative appointed by each Member at a meeting at
which a Quorum is present.
(c)    Special Meetings. Special meetings of the Executive Committee may be
called by or at the request of any Representative and shall be held on a
Business Day at the principal executive office of the Company. Notice of any
such special meeting of the Executive Committee shall be given by the calling
Representative specifying the time of the meeting to all of the other
Representatives no fewer than two (2) Business Days and no more than ten (10)
days prior to the date of such meeting. Any Representative may participate
telephonically in any special meeting of the Executive Committee. The attendance
of a Representative of the Executive Committee at a special meeting of the
Executive Committee (either in person or telephonically) shall constitute a
waiver of notice of such meeting, except where a Representative of the Executive
Committee attends a meeting for the express purpose of objecting to the
transaction of any business because the meeting was not properly called or
convened. The business to be transacted at, and the purpose of, any special
meeting of the Executive Committee need not be specified in the notice or waiver
of notice of such meeting. Notice of any special meeting may be waived by each
Representative of the Executive Committee.
(d)    Telephonic Participation. Representatives of the Executive Committee may
participate in any meetings of the Executive Committee telephonically or through
other similar communications equipment provided that all of the Representatives
participating in such meeting can hear each another. Participation in a meeting
pursuant to the preceding sentence shall constitute presence in person at such
meeting for all purposes of this Agreement.

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(e)    Transaction of Business. Provided that notice of a meeting has been given
in the manner set forth herein, a Quorum shall be entitled to transact business
at any meeting of the Executive Committee.
(f)    Actions Without Meetings. Any decision or action required or permitted to
be taken at a meeting of the Executive Committee or any other decision or action
that may be taken at a meeting of the Executive Committee may be taken without a
meeting if a consent in writing, setting forth the action so taken, is signed by
at least one (1) Representative of each Member, which shall have the same effect
as an act taken at a properly called and constituted meeting with a Quorum of
the Executive Committee at which all of the Representatives of the Executive
Committee were present and voting.
(g)    Proxies. Each Representative may authorize another person or persons to
act for him or her by proxy, but no such proxy shall be voted or acted upon
after sixty (60) days from its date, unless the proxy provides for a longer
period. A proxy shall be irrevocable if it states that it is irrevocable and if,
and only as long as, it is coupled with an interest sufficient in law to support
an irrevocable power. A Representative may revoke any proxy which is not
irrevocable by attending the meeting and voting in person or by filing an
instrument in writing revoking the proxy or by delivering a proxy in accordance
with applicable law bearing a later date to the Administrative Member.
(h)    Limitations on Authority. None of the Members, Representatives or
Officers, without the prior consent of the Executive Committee, may take any
action on behalf of or in the name of the Company, or enter into any commitment
or obligation binding upon the Company, except for (i) actions expressly
authorized by this Agreement, and (ii) actions by any Member (or Representative
or Officer) within the scope of such Member's (or Representative's or Officer's)
authority granted under this Agreement.
(i)    Compensation. Except as otherwise approved by the Executive Committee, no
Representative shall be entitled to receive any salary, remuneration or
reimbursement from the Company for his or her services as a Representative.
(j)    Involvement of the Representatives. Each Member shall cause its
Representatives to devote such time as is reasonably necessary to carry out its
duties and obligations as a Representative of the Executive Committee.
(k)    Resolving Deadlocks. If the Executive Committee is deadlocked on any
Major Decision (as defined in Section 2.04), then the Representatives shall
consult with one another in a good faith attempt to resolve such deadlock for a
period of sixty (60) days (or such longer period as is unanimously agreed to by
the Representatives). The failure of the Representatives to resolve any such
impasse for any reason prior to the expiration of such sixty (60)-day period
shall constitute an "Impasse Event" under this Agreement (so long as the
deadlock that resulted in such impasse remains unresolved). Prior to the
expiration of such sixty (60)-day period (or such longer period as is
unanimously agreed to by the Representatives), neither Member may elect to
commence the buy/sell procedure set forth in Article VIII as result of any
deadlock on any Major Decision.

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2.03    Administrative Member
The Members hereby initially designate Majestic as the "Administrative Member"
of the Company. The Administrative Member shall serve as the Administrative
Member, unless and until it resigns as provided in Section 2.11(b), is removed
pursuant to Section 2.11(c) or ceases to be a member of the Company. The
Administrative Member hereby agrees to use its commercially reasonable efforts
to carry out the business and affairs of the Company and to devote such time to
the Company as is necessary, in the reasonable discretion of the Administrative
Member, for the efficient operation of the business and affairs of the Company.
Subject to the terms of this Agreement (including Sections 2.04, 2.08 and 2.09),
the Administrative Member shall be responsible for (i) preparing and
implementing each Approved Business Plan (including, without limitation, each
Operating Budget and Marketing Plan contained therein), (ii) implementing the
decisions of the Executive Committee, (iii) reporting to the Executive Committee
as to the status of the business and affairs of the Company, (iv) managing,
supervising, and conducting the day-to-day business and affairs of the Company,
(v) managing the accounting and the contract and lease administration for the
Project including, without limitation, enforcing the Company's rights and
benefits, and causing the Company to perform its duties and obligations, under
each lease for space in the Project, and (vi) performing such other services
delegated to the Administrative Member under this Agreement including, without
limitation, (A) the marketing and leasing management services delegated to the
Administrative Member under Section 2.08 and (B) the reporting and accounting
functions delegated to the Administrative Member under Article XI. The
Administrative Member may not assign or delegate its duties or obligations under
this Agreement without the prior written consent of the Executive Committee.
2.04    Approval of Major Decisions
Notwithstanding any other provision contained in this Agreement, neither the
Administrative Member nor the other Member may cause the Company to undertake,
and the prior approval of the Executive Committee shall be required for, any and
all of the following matters (collectively, the "Major Decisions"), unless and
to the extent such matters have been specifically approved in the applicable
Approved Business Plan:
(a)    Approved Business Plans. The approval of each business plan for the
Company (and any material amendment, modification, revision or update thereof)
including each Operating Budget contained therein;
(b)    Construction of Improvements. The development and/or construction of any
improvements including, without limitation, any vertical, horizontal, tenant or
other improvements;
(c)    Sale of Project. The sale, exchange, transfer or other disposition of all
or any portion of the Project (exclusive of any lease of any portion of the
Project);
(d)    Lease of the Project. The form and execution of any lease for all or any
portion of the Project or any amendment, modification, extension or termination
of any lease for all or any portion of the Project;

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(e)    Financing. The procurement of any financing or refinancing (including,
without limitation, any acquisition, development, construction, interim and
long-term financing or refinancing in connection with the Project or the
entering into of any modification, amendment or other agreement of any financing
or refinancing;
(f)    Plans and Specifications. Except as previously approved in the Approved
Business Plan, or any change order within the limits of Section 2.04(i), the
approval of any plans and specifications for any tenant or other improvements to
be constructed by the Company (and any material amendment or material
modification thereof);
(g)    Selection of Architect and Engineer. The selection of any architect or
engineer retained by the Company in connection with the construction of any
tenant or other improvements to be constructed by the Company and the terms of
any contract entered into by and between the Company and any such architect or
engineer (and any amendment, modification or termination of any contract entered
into by the Company with any architect or engineer);
(h)    Construction Contract. The selection of any general contractor for the
construction of any tenant or other improvements to be constructed by the
Company and the execution or delivery by the Company of any construction
contract and any amendment, modification or termination of any construction
contract;
(i)    Change Orders. The approval by the Company of any change order relating
to the construction of any tenant or other improvements to be constructed by the
Company if (i) such change order would cause a material change in the quality of
the Improvements, (ii) the cost of any such change order exceeds Twenty-Five
Thousand Dollars ($25,000), or (iii) the aggregate cost of the change order
under consideration, together with all prior change orders, exceeds One Hundred
Thousand Dollars ($100,000);
(j)    Selection of Replacement Property Manager. Except as provided in Section
2.11(f), the selection of any property manager that will replace Tejon as a
Property Manager Member (as defined in Section 2.09) for the Project and the
execution or delivery by the Company of any property management agreement with
any such replacement property manager and any amendment, modification, extension
or termination of any such property management agreement;
(k)    Expenditures Outside of Budgets. The making of any expenditure by the
Company that is not specifically included or contemplated under any Approved
Business Plan for the Company, other than as permitted under Section 2.07;
(l)    Contracts with Affiliates. Except as provided in Sections 2.08 and 2.09,
the entry into by the Company of any contract with or otherwise making any
payment to any Member or any Affiliate of any Member and with respect to any
such contract, the making of any material amendment, modification, extension
and/or rescission thereof; the declaration of a default thereunder; the
institution, settlement and/or compromise of a claim with respect thereto; the
waiver of any rights of the Company

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against the other party(ies) thereto; or the consent to the assignment of any
rights and/or the delegation of any duties by the other party(ies) thereto;
(m)    Material Agreements. Except as provided in the Approved Business Plan,
the execution or delivery by the Company of any agreement obligating the Company
to pay an amount of more than One Hundred Thousand Dollars ($100,000) and any
amendment, modification, extension or termination of any such agreement,
including, without limitation, any agreement providing for the payment of any
commission, fee or other compensation payable in connection with the sale of all
or any portion of the Project;
(n)    Rebuild. The election to rebuild all or any portion of the Project
following a casualty in any case where the Company has the right to elect
whether or not to rebuild under the applicable agreements to which the Company
is a party;
(o)    Press Release. The making of any press release for any purpose relating
to the Company or the Project;
(p)    Employees. The hiring of any employee by the Company;
(q)    Taxes and Accounting. The selection or changing of the Company's
depreciation or other tax accounting methods or elections, changing the Fiscal
Year or taxable year of the Company, or making any other material decisions with
respect to the treatment of various transactions for accounting or tax purposes
that may adversely affect the Members;
(r)    Confess Judgments. The confession of a judgment against the Company for
an amount that exceeds Fifty Thousand Dollars ($50,000); the payment,
compromise, settlement or other adjustment of any claims against the Company for
an amount that exceeds Fifty Thousand Dollars ($50,000); or the commencement or
settlement of any legal actions or proceedings brought by or against the Company
if the amount in dispute with respect to such action or proceeding exceeds Fifty
Thousand Dollars ($50,000);
(s)    Loans. The lending of any funds by the Company to any Member or any
Affiliate thereof or to any third party, or the extension by the Company of
credit to any Person on behalf of the Company;
(t)    Guaranty. The execution or delivery of any document or agreement that
would cause the Company to become a surety, guarantor, endorser, or
accommodation endorser for any Person, except to the extent such guaranty or
endorsement is included in the then applicable Approved Business Plan;
(u)    Bankruptcy. Any of the following: (i) the filing of any voluntary
petition in bankruptcy on behalf of the Company; (ii) the consenting to the
filing of any involuntary petition in bankruptcy against the Company; (iii) the
filing by the Company of any petition seeking, or consenting to, the
reorganization or relief under any applicable federal or state law relating to
bankruptcy or

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insolvency; (iv) the consenting to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or other similar official) of the Company or a
substantial part of the Company's property; (v) the making of any assignment by
the Company for the benefit of creditors; (vi) the admission in writing of the
Company's inability to pay its debts generally as they become due; or (vii) the
taking of any action by the Company in furtherance of any such action;
(v)    Admission and Withdrawals. Except as permitted pursuant to Articles VI,
VII and VIII, the admission or withdrawal of any Member into or from the
Company;
(w)    Merger or Consolidation. The entry into by the Company of any merger,
consolidation or other material corporate transaction;
(x)    Acquisition of Property. The acquisition of any property by the Company
(other than the Property) and the terms and conditions for any such acquisition;
(y)    Purpose. The modification or change in the business purpose of the
Company;
(z)    Amendments to the Agreement. Any amendment to this Agreement (other than
amendment reflecting the admission or withdrawal of a Member in accordance with
the provisions of Articles VI, VII or VIII);
(aa)    Engaging in Other Businesses. The engagement of the Company in any
business or activity outside the scope of the Company's business set forth in
this Agreement;
(bb)    Dissolution. Except as required by this Agreement, the dissolution or
liquidation of the Company;
(cc)    Acts in Contravention. Any act in contravention of this Agreement; and
(dd)    Other Matters. Any other decision or matter described as a Major
Decision in this Agreement.
Without limiting the generality of the foregoing provisions of this
Section 2.04, neither the Administrative Member nor the Property Manager Member
shall undertake any action, expend any sum, make any decision, give any consent,
approval or authorization or incur any obligation with respect to any of the
foregoing Major Decisions, unless and until such matter has been approved by the
Executive Committee (or such matter has been specifically approved in the then
applicable Approved Business Plan). Each Representative of the Executive
Committee may withhold its approval of any Major Decision in such
Representative's sole and absolute discretion, except for the Major Decisions
described in Sections 2.04(a), (d), (e), (f), (g), (i) and (j) (for which such
approval shall not be unreasonably withheld, delayed or conditioned).
Notwithstanding anything to the contrary in this Agreement, either Member may,
without prior approval of the Executive Committee, take any action reasonably
necessary to protect life or property, in the event of an emergency where it is
impractical to obtain such prior approval; provided that the Member taking the
action

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shall use its best efforts to advise the Representatives as soon as possible of
the nature of the emergency and the emergency actions taken.
2.05    Consents and Approvals
Either Member shall seek the approval of the Executive Committee with respect to
any proposed matter set forth in Section 2.04 by delivering written notice to
the Representatives describing such proposed action in sufficient detail so as
to enable the Representatives to exercise an informed judgment with respect
thereto. Such notice shall constitute a call for a special meeting of the
Executive Committee as provided in Section 2.02(c) and shall specify a time for
the meeting and shall be deemed a notice by the requesting Member's
Representatives for purposes of Section 2.02(c). The Executive Committee shall
then meet and either approve or disapprove the proposed action. The
Representative(s) of the other Member shall set forth their reasons if they
disapprove such action, or may approve the requested action without a meeting as
provided in Section 2.02(f). If the Executive Committee fails to meet or
otherwise approve the requested action (as provided herein) on or before the
expiration of the Response Period, then it shall be conclusively presumed to
have disapproved such action. The term "Response Period" means (i) if a response
time is expressly set forth in this Agreement, then the period of time during
which the Member is required to respond, or (ii) if no response time period is
expressly set forth in this Agreement, then five (5) Business Days following the
effective date of the written notice describing any proposed action requiring
the consent or approval of such Member.
2.06    Approved Business Plan
Attached hereto as Exhibit "C" is an annual business plan for the remainder of
the 2016 Fiscal Year through the end of the 2017 Fiscal Year that has been
approved by the Members. On or before September 30 of each Fiscal Year of the
Company (commencing with the 2017 Fiscal Year), the Administrative Member shall
submit a new annual business plan for the ensuing Fiscal Year to the Executive
Committee for its review and approval. Each annual business plan shall include,
without limitation, (i) a narrative description of the proposed objectives and
goals for the Company, which shall include a description of any major
transaction to be undertaken by the Company for such Fiscal Year (or other
period); (ii) an Operating Budget, as more particularly described in
Section 2.07 below; (iii) a Marketing Plan as described in Section 2.08 for the
Improvements; and (iv) such other items as are agreed to by the Members. The
annual business plan for the applicable Fiscal Year (or other period) that is
approved by the Executive Committee is referred to as the "Approved Business
Plan."

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2.07    Operating Budget
Each Approved Business Plan shall include an operating budget ("Operating
Budget"), which sets forth, without limitation, on a detailed itemized basis for
the Project and the Company, (i) all anticipated receipts projected for the
period of such Operating Budget and all anticipated expenses, by category, for
the Company (including, without limitation, all repairs and capital expenditures
projected by the Administrative Member to be incurred during such period),
(ii) the anticipated Cash Flow reserves projected to be required for such
period, and (iii) a projection setting forth the estimated annual revenues,
expenses and net operating income (or loss) expected to be incurred for the
ensuing Fiscal Year, which shall be updated to compare the actual results to the
projected results set forth in the prior Operating Budget. The Operating Budget
shall also include a detailed description of such other information, contracts,
agreements and other matters reasonably necessary to inform the Members of all
matters relevant to the operation, management, maintenance, leasing and sale of
the Project (or any portion thereof) or as may be reasonably requested by any
Member. The Administrative Member shall have the right, power and authority
without the consent of the other Member (A) to apply up to fifty percent (50%)
of the contingency line item and any line item cost savings to other line items,
and (B) to cause the Company to incur expenditures in excess of any line item,
provided that any such expenditure does not exceed such line item by more than
ten percent (10%), after the application of any contingency line item or cost
savings. The Administrative Member shall also have the right, power and
authority to incur actual expenditures on behalf of the Company (with Company
funds) for (1) any of the items set forth in any approved Operating Budget, as
the same may be adjusted in accordance with the foregoing provisions of this
Section 2.07, and (2) any items outside of an approved Operating Budget provided
such item does not exceed Fifty Thousand Dollars ($50,000) alone or in the
aggregate, without the further consent of the other Member.
2.08    Marketing and Leasing Management
The Administrative Member shall be responsible for preparing a marketing plan
for the Project with the assistance and cooperation of the other Member. The
marketing plan shall be submitted by the Administrative Member to the Executive
Committee for its review and approval not later than thirty (30) days following
the Effective Date, which approval shall not be unreasonably withheld, delayed
or conditioned. Each marketing plan that is approved by the Executive Committee
is hereinafter referred to as the "Marketing Plan." The Marketing Plan shall
describe in reasonable detail (i) the types of proposed users and buyers for the
Project, as appropriate, (ii) the marketing, leasing and sales objectives and a
timeline for accomplishing such objectives, and (iii) such other information
regarding the marketing of the Project as is reasonably requested by the
Executive Committee. The Administrative Member shall be responsible for
implementing each Marketing Plan on behalf of the Company (provided the Company
shall pay all third-party out-of-pocket costs and expenses incurred in
connection with the implementation of each such Marketing Plan). The Marketing
Plan shall be updated by the Administrative Member on a quarterly basis and
submitted to the Executive Committee for its review and approval, which approval
shall not be unreasonably withheld, delayed or conditioned. Notwithstanding the
foregoing, if the Project is fully leased, then the Administrative Member shall
not be required to update the Marketing Plan prior to the date that is one (1)
year prior to the expiration of the earliest of such leases to expire (unless
otherwise requested to do so by the other Member).

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2.09    Property Management
Tejon shall act as property manager for the Project (the "Property Manager
Member"). In its capacity as Property Manager Member for the Project, Tejon
shall be responsible for the repair and maintenance of the Project and customer
service, and such other property management functions as may be delegated to it
by the Executive Committee. The Property Management Member may not assign or
delegate its duties or obligations under this Agreement without the prior
written consent of the Executive Committee.
2.10    Authority with Respect to the Affiliate Agreements
Notwithstanding any other provision of this Agreement including, without
limitation, Sections 2.01, 2.02, 2.03 and 2.04, Tejon or Majestic, as the case
may be, shall have the sole right, power and authority, in its sole and absolute
discretion and without the consent or approval of the other Member, (i) to cause
the Company to enforce its rights under any contract or other agreement entered
into by the Company with the other Member and/or any Affiliate thereof
(collectively, the "Affiliate Agreements") following any breach by the other
Member and/or any Affiliate thereof under any such Affiliate Agreement, (ii) to
make all decisions on behalf of the Company with respect to any amendment,
modification, rescission, extension, and/or termination under any Affiliate
Agreement, (iii) to determine the existence of any default under any Affiliate
Agreement and to cause the Company to declare any such default following any
breach by the other Member and/or any Affiliate thereof under such Affiliate
Agreement, (iv) to cause the Company to institute, settle and/or compromise any
claim under any Affiliate Agreement against the other Member and/or any
Affiliate thereof, (v) to cause the Company to waive any rights of the Company
against the other Member and/or any Affiliate thereof under any Affiliate
Agreement, and (vi) to cause the Company to consent to the assignment of any
rights and/or the delegation of any duties by the other Member and/or any
Affiliate thereof under any Affiliate Agreement. Majestic or Tejon, as the case
may be, shall cooperate in good faith with the other Member in the exercise by
the other Member of the foregoing rights and actions under the Affiliate
Agreements.
2.11    Election, Resignation, Removal of the Administrative or Property Manager
Member
(a)    Number, Term and Qualifications. The Company shall have one (1)
Administrative Member which must be a member of the Company. Unless it resigns
(pursuant to the terms of this Agreement), is removed, or ceases to be a member
of the Company, the Administrative Member shall hold office until a successor
shall have been elected and qualified. Unless the Administrative Member resigns
or is removed pursuant to Section 2.11(c), a new Administrative Member may not
be appointed without the approval of the Executive Committee.
(b)    Resignation. The Administrative Member may resign upon no less than one
hundred twenty (120) days prior written notice to the other Member. Except as
set forth below in Section 2.11(d), any resignation of the Administrative Member
in accordance with the terms of this Section 2.11(b) shall not affect the
Administrative Member's rights as a member of the Company, and shall not
constitute a withdrawal of the Administrative Member as a member of the Company.
(c)    Removal. The Administrative Member (or any successor administrative
member) may be removed following the occurrence of a Just Cause Event, by
written notice ("Removal Notice") from

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the other Member to the Administrative Member within forty-five (45) days
following the date such Member first becomes aware of such Just Cause Event. The
Removal Notice shall specify in reasonable detail the Just Cause Event giving
rise to the removal. For purposes of this Section 2.11(c), "Just Cause Event"
shall mean:
(i)    Breach of Agreement. The breach of any material covenant, duty or
obligation under this Agreement by the Administrative Member if (i) the
Administrative Member has received written notice from the other Member of the
breach describing such breach in reasonable detail, and (ii) (A) the breach is
not reasonably susceptible of being cured, or (B) if the breach is reasonably
susceptible of being cured, (1) the Administrative Member has failed to commence
the cure or remedy of the breach within fifteen (15) days following the
effective date of the notice, or (2) failed to complete the cure or remedy
within a reasonable period of time (not to exceed sixty (60) days following the
effective date of such notice, unless the cure or remedy cannot be reasonably
completed within such sixty (60)-day period and the Administrative Member fails
to diligently proceed with the cure or remedy to completion within an additional
forty-five (45) days following the expiration of such initial sixty (60)-day
period);
(ii)    Fraud, Willful Misconduct, Gross Negligence, Etc. The fraud, willful
misconduct, gross negligence or conviction of a crime involving moral turpitude
by the Administrative Member (other than any misappropriation of funds described
in clause (iii) below); or
(iii)    Misappropriation of Funds. Any misappropriation of funds by the
Administrative Member provided that if such misappropriation of funds is
committed by an employee of the Administrative Member, then such event shall not
constitute a Just Cause Event if, within ten (10) Business Days after being
notified in writing of such event, the Administrative Member makes full
restitution to the Company of all damages caused by such event and terminates
the employment of such employee.
(d)    Rights Following Resignation or Removal. Upon the resignation of an
Administrative Member or the removal of a member as the Administrative Member in
accordance with this Section 2.11(d), (i) the resigned or removed Member shall
be relieved of its duties as Administrative Member under this Agreement
including, without limitation, the duty to provide the marketing services
described in Section 2.08, (ii) the other Member shall have the right, power and
authority to designate each replacement Administrative Member (which may be the
other Member (including a member, which previously served as the Administrative
Member), any Affiliate of the other Member and/or any other Person) to replace
the Member that has resigned or been removed as the Administrative Member (or
any replacement Administrative Member) and such replacement Administrative
Member shall have all of the rights, duties and obligations of the
Administrative Member under this Agreement (including, without limitation, the
right to receive any fees or other amounts payable to the Administrative Member
under this Agreement following such resignation or removal for services that are
thereafter provided by the replacement Administrative Member), and (iii) the
other Member may terminate any or all of the Affiliate Agreements entered into
with the Administrative Member or any Affiliate thereof and/or hire at

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the expense of the Company a new marketing director and/or property manager
including, without limitation, any Affiliate of such other Member which is
qualified to render the services previously provided by the resigned or removed
Member.
(e)    No Adjustment to Percentage Interests. Except as provided in
Section 2.11(d), if a Member resigns or is removed as the Administrative Member,
then the Percentage Interests of the Members shall not be adjusted and the
removed Administrative Member shall retain all of its rights, duties and
obligations of a member under this Agreement (other than any rights, duties
and/or obligations as the Administrative Member).
(f)    Property Manager Member. The provisions of this Section 2.11 relating to
the resignation or removal of the Administrative Member and rights following
such resignation or removal, shall apply to the same extent to the Property
Manager Member substituting "Property Manager Member" for "Administrative
Member" where appropriate.
2.12    Officers
(a)    Appointment of Officers. The Executive Committee may appoint, and
delegate authority to, officers ("Officers") of the Company at any time. The
Officers of the Company may include, without limitation, a Chief Executive
Officer, President, Chief Financial Officer, Chief Operating Officer, Senior
Vice President, Vice President, Assistant Vice President, Secretary and
Assistant Secretary. Any individual may hold any number of offices. Unless the
Executive Committee otherwise determines in its sole and absolute discretion,
(i) if the title assigned to any Officer is one commonly used for officers of a
business corporation formed under the Delaware General Corporation Law, then the
assignment of such title shall constitute the delegation to such person of the
rights, powers, duties, obligations and authority that are normally associated
with that office, and (ii) no Officer shall receive any salary or other
compensation for acting as an Officer of the Company. Any delegation pursuant to
this Section 2.12(a) may be revoked at any time by the Executive Committee. The
Officers shall serve at the pleasure of the Executive Committee.
(b)    Removal of Officers. Any Officer may be terminated, either with or
without cause, by the Executive Committee at any time. Any Officer may resign at
any time by giving written notice to the Executive Committee. Any resignation
shall take effect as of the effective date of any such notice or at any later
time specified in such notice; and, unless otherwise specified in that notice,
the acceptance of the resignation shall not be necessary to make it effective. A
vacancy in any office because of death, incapacity, resignation, removal,
disqualification or any other cause shall be filled, if at all, in the manner
prescribed in this Agreement for regular appointments to that office.

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2.13    Management Fees.
As compensation for rendering the services described in Section 2.03, and
elsewhere in this Agreement, in the case of the Administrative Member, and in
Section 2.09 in the case of the Property Manager Member, (i) each Member shall
be reimbursed for the reasonable third-party out-of-pocket costs incurred by
such Member in rendering such services, and (ii) the Company shall pay to each
Member a fee (the "Management Fee") equal to one and 5/10ths percent (1.5%) of
the gross receipts received by the Company from the operation of the Project.
The Management Fee shall be earned and payable on the first day of each calendar
month based upon the gross operating receipts received by the Company in the
preceding calendar month. If, but only if, a Member agrees to provide the
management services that the other Member is required to render pursuant to
Section 2.03 or Section 2.09 following the removal or resignation of such Member
pursuant to Sections 2.11(b), 2.11(c) or 2.11(f), and further provided that such
Member does not hire a new marketing director or property manager pursuant to
Section 2.11(d)(iii), then the Management Fee that is otherwise payable to the
other Member shall thereafter be paid to the Member that provides such services.
2.14    Treatment of Payments
For financial and income tax reporting purposes, any and all fees paid by the
Company to any Member and/or any Affiliate thereof shall be treated as expenses
of the Company and, if paid to any Member, as guaranteed payments within the
meaning of Section 707(c) of the Code. To the extent all or any portion of any
fee is not paid in full prior to the liquidation of the Company, such unpaid
portion of such fee shall constitute a debt of the Company payable upon such
liquidation. The Members acknowledge and agree that any fee paid to any Member
(and/or any Affiliate thereof) in accordance with the terms of this Agreement
shall constitute the sole and exclusive property of such recipient Member
(and/or such Affiliate), and the other Member shall not have any rights thereto
or interests therein.
2.15    Reimbursement and Fees
Except as expressly provided in this Agreement, or otherwise agreed to in
writing by the Members, including, without limitation, pursuant to the terms of
any Approved Business Plan, none of the Members (or their respective Affiliates
and/or other representatives) shall be paid any compensation for rendering
services to the Company or otherwise be reimbursed for any costs and expenses
incurred by such Member (and/or any Affiliate or representative thereof) on
behalf of the Company. Without limiting the generality of the foregoing, neither
Member nor any Affiliate thereof shall be reimbursed for any general and
administrative costs and expenses incurred by such party. Any request for
reimbursement by any Member pursuant to this Section 2.15 shall be accompanied
by supporting documentation and shall be made within forty-five (45) days after
the date such expenses are incurred by such Member. Any such reimbursements
shall not reduce such Member's Capital Account or Unreturned Contribution
Account.

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2.16    Insurance
The Administrative Member shall cause the Company to purchase and maintain (at
the expense of the Company) a commercial general liability insurance policy and
a property insurance policy in such amounts as are reasonably determined by the
Executive Committee and such other insurance as may be requested from time to
time by the Executive Committee. The cost of any insurance policies maintained
by the Company pursuant to this Section 2.16 shall be an expense of the Company
and shall be included in the Operating Budget.
ARTICLE III
    
MEMBERS' CONTRIBUTIONS TO COMPANY
3.01    Initial Capital Contributions of the Members
Concurrently with the execution and delivery of this Agreement, each Member
shall contribute, in cash, the amount set forth opposite such Member's name
under the column entitled "Initial Cash Contribution" on Exhibit "A" attached
hereto (the "Initial Contribution"), provided that Majestic shall be credited
with amounts expended as third-party out-of-pocket pursuit costs for the
Property upon the written approval of such costs by Tejon. Each Member's Capital
Account shall be credited by the amount of such Member's Initial Contribution as
and when such contribution is made.
3.02    Additional Capital Contributions
If the Company has insufficient funds to meet its current or projected financial
requirements (a "Shortfall"), then the Administrative Member shall give written
notice (the "Capital Call Notice") of such Shortfall to the other Member. The
Contribution Notice shall summarize, with reasonable particularity, the
Company's actual and projected cash obligations, cash on hand, projected sources
and amounts of future Cash Flow and a contribution date ("Contribution Date")
(which shall not be less than ten (10) Business Days following the effective
date of such notice) upon which each Member shall be obligated to contribute to
the capital of the Company, in cash, such Member's Percentage Interest of the
funds necessary to satisfy such Shortfall. If the Company has a Shortfall and
the Administrative Member fails to deliver a Capital Call Notice so that the
Company may timely satisfy such Shortfall, then the other Member may deliver the
Capital Call Notice pursuant to this Section 3.02. Any and all amounts
contributed to the capital of the Company by any Member pursuant to this
Section 3.02 shall be credited to such Member's Capital Account and Unreturned
Contribution Account on the date any such contribution is made.
3.03    Remedy for Failure to Contribute Capital
If any Member (the "Non-Contributing Member") fails to contribute timely all or
any portion of the additional capital such Member is required to contribute
pursuant to Section 3.02 (the "Delinquent Contribution"), and provided that the
other Member (the "Contributing Member") has timely contributed to the capital
of the Company all of the additional capital (if any) required to be contributed
by such Contributing Member pursuant to Section 3.02 (with respect to that
particular notice and capital call), then such Contributing Member shall have
the right, in lieu of any other right or remedy available at law, in equity or
otherwise to the

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Contributing Member and/or the Company (or any other party), to select one (1)
or more of the following options in accordance with the terms set forth below in
this Section 3.03:
(a)    Loan Remedy. The Contributing Member may advance to the Company, in cash,
within thirty (30) days following the Contribution Date, an amount equal to the
Delinquent Contribution, and such advance shall be treated as a nonrecourse loan
("Default Loan") by the Contributing Member to the Non-Contributing Member,
bearing interest at a rate equal to the lesser of (i) the prevailing prime
commercial lending rate of Wells Fargo Bank plus five (5) percentage points,
adjusted concurrently with any adjustments to such rate and compounded annually,
or (ii) the maximum, nonusurious rate then permitted by law for such loans.
Subject to Sections 7.09 and 8.08, each Default Loan shall be due and payable in
full one hundred twenty (120) days from the date advanced (or, if earlier, upon
the dissolution of the Company).
As of the effective date of the advance of any Default Loan, the Capital Account
and the Unreturned Contribution Account of the Non-Contributing Member shall be
credited with an amount equal to the original principal balance of the Default
Loan made by the Contributing Member to the Non-Contributing Member.
Notwithstanding the provisions of Articles V and XII, until any and all Default
Loans made to the Non-Contributing Member are repaid in full, the
Non-Contributing Member shall receive no further distributions from the Company,
and all cash or property otherwise distributable with respect to the
Non-Contributing Member's Interest shall be distributed to the Contributing
Member as a reduction of the outstanding balance of (together with all accrued,
unpaid interest thereon) any and all such Default Loans, with such funds being
applied first to reduce any and all interest accrued on such Default Loan(s) and
then to reduce the principal amount thereof. Any amounts so applied shall be
treated, for all purposes under this Agreement, as having actually been
distributed to the Non-Contributing Member pursuant to Section 5.01 and applied
by the Non-Contributing Member to repay such outstanding Default Loan(s).
To secure the repayment of any and all Default Loans made to the
Non-Contributing Member, such Non-Contributing Member hereby grants a security
interest in favor of the Contributing Member in and to the Non-Contributing
Member's entire Interest in the Company, and hereby irrevocably appoints the
Contributing Member, and each of the Contributing Member's representatives,
agents, officers or employees, as the Non-Contributing Member's
attorney(s)-in-fact, with full power to prepare, execute, acknowledge, and
deliver, as applicable, all documents, instruments, and/or agreements
memorializing and/or securing such Default Loan(s), including, without
limitation, such Uniform Commercial Code financing and continuation statements,
mortgages, pledge agreements and other security instruments as may be reasonably
appropriate to perfect and continue the security interest in favor of such
Contributing Member.
The Contributing Member is also authorized to cause the Company to issue
certificates (collectively, the "Certificates") evidencing the Members'
respective Interests in the Company (in such form as is determined in the sole
and absolute discretion of the Contributing Member) and is further authorized to
take possession and control of any such Certificate of the Non-Contributing
Member if it has made a Default Loan to the Contributing Member. Following the
issuance of the Certificates, each

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Interest in the Company shall constitute a "certificated security" within the
meaning of, and be governed by, (i) Section 8-102(a)(15) of the Uniform
Commercial Code as in effect from time to time in the State of Delaware, and
(ii) the Uniform Commercial Code of any other applicable jurisdiction that now
or hereafter substantially includes the 1994 revisions to Article 8 thereof as
adopted by the American Law Institute and the National Conference of
Commissioners on Uniform State Laws and approved by the American Bar Association
on February 14, 1995. Notwithstanding any provision of this Agreement to the
contrary, to the extent any provision of this Agreement is inconsistent with any
non-waivable provision of Article 8 of the Uniform Commercial Code, as in effect
in the State of Delaware (6 Del C. § 8-101, et seq.), such provision of
Article 8 of the Uniform Commercial Code shall control.
If, upon the maturity of a Default Loan (taking into account any agreed upon
extensions thereof), any principal thereof and/or accrued interest thereon
remains outstanding, then the Contributing Member may elect any one (1) of the
following options: (i) to renew such Default Loan (or portion thereof) pursuant
to the terms and provisions of this Section 3.03(a) for such additional terms as
is determined in the sole and absolute discretion of the Contributing Member;
(ii) to institute legal (or other) proceedings against the Non-Contributing
Member to collect such loan which may include, without limitation, foreclosing
against the security interest granted above; (iii) to contribute all or any
portion of such outstanding principal of, and accrued interest on, such Default
Loan (or portion thereof) to the capital of the Company and dilute the
Percentage Interest of the Non-Contributing Member pursuant to the provisions of
Section 3.03(b), or (iv) to implement the default provisions set forth in
Article VII in accordance with the provisions of Section 3.03(c).
The Contributing Member may elect any of the options set forth in the
immediately preceding sentence by giving written notice of such election to the
Non-Contributing Member within thirty (30) days following such maturity date.
Failure of the Contributing Member to timely give such written notice to the
Non-Contributing Member shall be deemed to constitute an election to renew such
Default Loan for an additional term of one hundred twenty (120) days on the
terms set forth herein. If the Contributing Member elects to foreclose upon the
security interest in the Non-Contributing Member's Interest in the Company
granted above, then the Contributing Member is authorized to cancel the
Certificate evidencing the Non-Contributing Member's Interest in the Company and
issue a new Certificate to the Contributing Member that has foreclosed upon such
Interest.
(b)    Dilution Remedy. The Contributing Member may contribute to the capital of
the Company, in cash, within thirty (30) days following the Contribution Date an
amount equal to the Delinquent Contribution, and such Contributing Member's
respective Capital Account and Unreturned Contribution Account shall each be
credited with the amount contributed by such Contributing Member. Further, upon
the maturity of a Default Loan that is not fully repaid on or before the
maturity date thereof, the Contributing Member may contribute to the capital of
the Company, in accordance with the provisions of Section 3.03(a) above, all or
any portion of the outstanding principal of and/or accrued interest on such
Default Loan (or portion thereof) previously advanced by such Contributing
Member that is not repaid prior to the maturity date thereof, and (i) the amount
of such outstanding principal and/or interest so contributed shall be deemed
repaid and satisfied; (ii) the Capital Account and the Unreturned Contribution
Account of the Non-Contributing Member shall be decreased, but not below

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zero (0), by the amount of such outstanding principal and/or interest so
contributed; and (iii) the Capital Account and the Unreturned Contribution
Account of the Contributing Member shall be increased by the amount of such
outstanding principal and/or interest so contributed.
Upon the contribution of the Delinquent Contribution and/or the outstanding
balance of a Default Loan by the Contributing Member pursuant to the foregoing
provisions of this Section 3.03(b), (i) the Percentage Interest of the
Non-Contributing Member shall be decreased by the Dilution Percentage, and
(ii) the Percentage Interest of the Contributing Member shall be increased by a
like amount of percentage points. The "Dilution Percentage" shall equal the
amount expressed in percentage points calculated based upon the following
formula:

[ex1037image1.jpg]
The application of the provisions of this Section 3.03(b) are illustrated by the
following example: Assume that (i) the aggregate amount of the prior capital
contributions made by the Non-Contributing Member is Two Million Three Hundred
Thousand Dollars ($2,300,000), (ii) a contribution of Four Hundred Thousand
Dollars ($400,000) is required to be contributed by the Members to the capital
of the Company pursuant to Section 3.02, (iii) the Non-Contributing Member has a
Percentage Interest of fifty percent (50%) and fails to contribute its share of
such contribution equal to Two Hundred Thousand Dollars ($200,000) (i.e., 50% ×
$400,000), and (iv) the Contributing Member has a Percentage Interest of fifty
percent (50%) and contributes its entire share of such contribution equal to Two
Hundred Thousand Dollars ($200,000) (i.e., 50% x $400,000) and the Delinquent
Contribution of Two Hundred Thousand Dollars ($200,000) to the capital of the
Company on behalf of the Non-Contributing Member pursuant to this
Section 3.03(b). By operation of this Section 3.03(b), the Dilution Percentage
would be equal to twelve (12) percentage points as calculated in accordance with
the following formula:

[ex1037image2.jpg]

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Accordingly, the Percentage Interest of the Non-Contributing Member would be
reduced by twelve (12) percentage points from fifty percent (50%) to
thirty-eight percent (38%) and the Percentage Interest of the Contributing
Member would be increased by a like amount of percentage points from fifty
percent (50%) to sixty-two percent (62%).
(c)    Implementation of Default Provisions. The Contributing Member may elect
to implement the default provisions contained in Article VII by delivery of
written notice of such election to the Non-Contributing Member within ninety
(90) days following the Contribution Date or the maturity date for any Default
Loan that is not repaid prior to the maturity thereof.
(d)    Election of Remedy. The Contributing Member shall determine which of the
options set forth in Sections 3.03(a), 3.03(b) and/or 3.03(c) are to be
exercised by the Contributing Member with respect to each Delinquent
Contribution. If the Contributing Member advances any amount to the Company
pursuant to this Section 3.03 but fails to specify which of the foregoing
options the Contributing Member has elected within thirty (30) days after the
effective date that the Contributing Member makes such advance, then such
Contributing Member shall be deemed to have elected the option set forth in
Section 3.03(a) above with respect to such advance.
(e)    Minimum Percentage Interest. Any and all adjustments to the Members'
respective Percentage Interests pursuant to Section 3.03(b) shall be rounded to
the nearest 1/100th of one percentage point (0.01%) and the Contributing Member
shall not succeed to all or any portion of the Capital Account and/or Unreturned
Contribution Account of the Non-Contributing Member as the result of any such
adjustment. In addition, notwithstanding any provision contained in this
Article III, the Non-Contributing Member's Percentage Interest shall in no event
be reduced below 1/100th of one percent (0.01%) by operation of Section 3.03(b).
3.04    Financing
The Administrative Member shall use its commercially reasonable efforts to cause
the Company to obtain an acquisition loan (the "Acquisition Loan") to finance
the acquisition of the Property from one (1) or more independent third-party
institutional lenders selected by the Administrative Member (individually, the
"Lender" and collectively, the "Lenders") upon prevailing market terms and
conditions. Upon the request of the Executive Committee, the Administrative
Member shall also use its commercially reasonable efforts to obtain a permanent
loan (the "Permanent Loan") from one (1) or more Lenders to refinance the
Acquisition Loan upon prevailing market terms and conditions (and any other
financing thereafter required to refinance the Permanent Loan). It is
anticipated that the Members shall be required to guarantee, on a joint and
several basis, fifty percent (50%) of the Acquisition Loan. It is further
anticipated that the Permanent Loan shall be nonrecourse to the Members (subject
to any Loan Documents described in Section 3.05 required to be provided to the
Lender providing any such Permanent Loan). The Acquisition Loan and the
Permanent Loan shall be secured by a deed of trust encumbering the Project. Any
such financing and/or refinancing obtained by the

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Administrative Member on behalf of the Company (collectively, the "Loans") shall
require the consent of the Executive Committee pursuant to Section 2.04(e).
3.05    Agreement to Provide Guarantees and Indemnification
Each Member and/or one (1) or more of their respective Affiliates or
representatives, including, without limitation, the ultimate parent of each
Member if required by the applicable Lender (collectively, the "Guarantors" and
individually, a "Guarantor") shall execute and deliver to any Lender providing
the Acquisition Loan or any Permanent Loan any and all guaranties, environmental
indemnities and "bad-boy" carve-out guaranties required by such Lender
(collectively, the "Loan Documents") provided such Loan Documents are approved
by the Executive Committee in its reasonable discretion.
Except with respect to the Acquisition Loan, the Administrative Member shall use
its commercially reasonable efforts to obtain each Lender's agreement that the
obligation of each Guarantor under each Loan Document shall be several (i.e.,
not joint and several) as between the Members (and their respective Affiliates)
and proportionate to the Percentage Interest of each Member that is an Affiliate
of such Guarantor. The Members acknowledge and agree that each Loan Document
executed by any Guarantor shall be executed only as an accommodation to the
Company and/or the Members. The Company shall indemnify, defend, protect and
hold each such Guarantor wholly harmless from and against any and all claims,
liabilities, losses, costs, expenses, damages and/or expenses including, without
limitation, any attorneys' and expert witness fees and costs (collectively,
"Losses") incurred by any such Guarantor as a result of such Loan Document (or
as a result of the rights of contribution described below) in accordance with
the terms of Section 10.02(b). Either Member may deliver a Capital Call Notice
in accordance with the provisions of Section 3.02 to require the Members to make
additional contributions to the capital of the Company to enable the Company to
satisfy the indemnity for any Losses described in this Section 3.05.
If the Company fails to fully satisfy any indemnification and/or defense
obligation owing to any Member or any Guarantor affiliated with such Member
pursuant to the provisions of this Section 3.05, then such Guarantor
("Contributing Party") shall have a right of contribution against the other
Member (the "Non-Contributing Party") to the extent the liability incurred by
the Contributing Party under any Loan Document (for which it is entitled to be
indemnified by the Company pursuant Section 10.02(b)) exceeds such Contributing
Party's Pro Rata Share of the total liability incurred by all of the Guarantors
under all of the Loan Documents (for which the Guarantors are entitled to be
indemnified by the Company pursuant to Section 10.02(b)). The term "Pro Rata
Share" means (i) with respect to Tejon and its Guarantors, an amount equal to
fifty percent (50%) of the total liability incurred by all of the Guarantors
under all of the Loan Documents (for which the Guarantors are entitled to be
indemnified by the Company pursuant to Section 10.02(b) below), and (ii) with
respect to Majestic and its Guarantors, an amount equal to fifty percent (50%)
of the total liability incurred by all of the Guarantors under all of the Loan
Documents (for which the Guarantors are entitled to be indemnified by the
Company pursuant to Section 10.02(b) below).
At any time that any Contributing Party has a right of contribution against the
Non-Contributing Party under this Section 3.05, the Non‑Contributing Party shall
be obligated to satisfy such contribution obligation by paying the required
amount, in cash, within ten (10) days following written notice thereof from the

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Contributing Party. If any such payment is not timely and validly made within
such ten (10)-day period, then from and after the date such amount was required
to be paid, such amount shall bear interest at the lesser of (A) the prevailing
prime commercial lending rate of Wells Fargo Bank plus five (5) percentage
points, adjusted concurrently with any adjustments to such rate and compounded
annually, or (B) the maximum non-usurious rate allowed by law. The Contributing
Party shall also be entitled to collect from the Non‑Contributing Party any and
all costs and expenses of enforcing such contribution obligation including,
without limitation, reasonable attorneys' and expert witness fees and costs.
The Members acknowledge and agree that each of the Guarantors (that are not
Members) are express third-party beneficiaries of the foregoing provisions of
this Section 3.05, and, as such, all of the Guarantors have the right, power and
authority to enforce the provisions of this Section 3.05.
3.06    Capital Contributions in General
Except as otherwise expressly provided in this Agreement or as otherwise agreed
to in writing by all of the Members (i) no part of the contributions of any
Member to the capital of the Company may be withdrawn by such Member, (ii) no
Member shall be entitled to receive interest on such Member's contributions to
the capital of the Company, (iii) no Member shall have the right to demand or
receive property other than cash in return for such Member's contribution to the
Company, and (iv) no Member shall be required or be entitled to contribute
additional capital to the Company other than as permitted or required by this
Article III.
ARTICLE IV
    
ALLOCATION OF PROFITS AND LOSSES
4.01    Net Losses
After giving effect to the special allocations in Sections 4.03 and 4.04, Net
Losses for any Fiscal Year shall be allocated among the Members so as to reduce,
proportionately, the differences between their respective Target Capital
Accounts and Partially Adjusted Capital Accounts for such Fiscal Year. No
portion of the Net Losses for any taxable year shall be allocated to a Member
whose Partially Adjusted Capital Account is less than or equal to such Member's
Target Capital Account for such Fiscal Year.
4.02    Net Profits
After giving effect to the special allocations in Sections 4.03 and 4.04, Net
Profits for any Fiscal Year shall be allocated among the Members so as to
reduce, proportionately, the differences between their respective Target Capital
Accounts and Partially Adjusted Capital Accounts for such Fiscal Year. No
portion of the Net Profits for any taxable year shall be allocated to a Member
whose Partially Adjusted Capital Account is greater than or equal to such
Member's Target Capital Account for such Fiscal Year.

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4.03    Special Allocations
Notwithstanding any other provisions of this Agreement, no Net Losses or items
of expense, loss or deduction shall be allocated to any Member to the extent
such an allocation would cause or increase a deficit balance standing in such
Member's Adjusted Capital Account and any such Net Losses and items of expense,
loss and deduction shall instead be allocated to the Members in proportion to
their respective "interests" in the Company as determined in accordance with
Treasury Regulation Section 1.704‑1(b). In addition, items of income and gain
shall be specially allocated to the Members in accordance with and to the extent
required by the qualified income offset provisions set forth in Treasury
Regulation Section 1.704‑1(b)(2)(ii)(d). Notwithstanding any other provision in
this Article IV, (i) any and all "partnership nonrecourse deductions" (as
defined in Treasury Regulation Section 1.704‑2(b)(1)) of the Company for any
Fiscal Year or other period shall be allocated to the Members in proportion to
their respective Percentage Interests; (ii) any and all "partner nonrecourse
deductions" (as such term is defined in Treasury Regulation
Section 1.704‑2(i)(2)) attributable to any "partner nonrecourse debt" (as such
term is defined in Treasury Regulation Section 1.704‑2(b)(4)) shall be allocated
to the Member that bears the "economic risk of loss" (as determined under
Treasury Regulation Section 1.752-2) for such "partner nonrecourse debt" in
accordance with Treasury Regulation Section 1.704‑2(i)(l); (iii) each Member
shall be specially allocated items of Company income and gain in accordance with
the partnership minimum gain chargeback requirements set forth in Treasury
Regulation Sections 1.704‑2(f) and 1.704‑2(g); and (iv) each Member with a share
of minimum gain attributable to any "partner nonrecourse debt" shall be
specially allocated items of Company income and gain in accordance with the
partner minimum gain chargeback requirements of Treasury Regulation
Sections 1.704‑2(i)(4) and 1.704‑2(i)(5). Any and all "excess nonrecourse
liabilities" as determined under Treasury Regulation Section 1.752‑3(a)(3) shall
be allocated to the Members in proportion to their respective Percentage
Interests.
4.04    Curative Allocations
The allocations set forth in Section 4.03 (the "Regulatory Allocations") are
intended to comply with certain requirements of the Treasury Regulations. It is
the intent of the Members that, to the extent possible, all Regulatory
Allocations shall be offset either with other Regulatory Allocations or with
special allocations of other items of Company income, gain, loss or deduction
pursuant to this Section 4.04. Therefore, notwithstanding any other provision of
this Article IV (other than the Regulatory Allocations), the Administrative
Member is hereby authorized to make such offsetting special allocations of
Company income, gain, loss or deduction in whatever manner it determines
appropriate so that, after such offsetting allocations are made, each Member's
Capital Account balance is, to the extent possible, equal to the Capital Account
balance such Member would have had if the Regulatory Allocations were not part
of this Agreement and all Company items were allocated pursuant to Sections 4.01
and 4.02. In exercising its discretion under this Section 4.04, the
Administrative Member shall take into account future Regulatory Allocations
under Section 4.03, that are likely to offset other Regulatory Allocations
previously made under the provisions of this Section 4.04.

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4.05    Differing Tax Basis; Tax Allocation
Depreciation and/or cost recovery deductions and gain or loss with respect to
each item of property treated as contributed to the capital of the Company shall
be allocated between the Members for federal income tax purposes in accordance
with the principles of Section 704(c) of the Code and the Treasury Regulations
promulgated thereunder, and for state income tax purposes in accordance with
comparable provisions of the California Revenue & Taxation Code, as amended, and
the regulations promulgated thereunder, so as to take into account the
variation, if any, between the adjusted tax basis of such property and its book
value (as determined for purposes of the maintenance of Capital Accounts in
accordance with this Agreement and Treasury Regulation
Section 1.704‑1(b)(2)(iv)(g)).
ARTICLE V
    
DISTRIBUTION OF CASH FLOW
5.01    Cash Flow
Subject to Section 12.02, Cash Flow of the Company shall be determined and
distributed on a quarterly basis (or at such other times as are determined by
the Executive Committee), in the following order of priority:
(a)    Unreturned Contribution Accounts. First, to the Members in proportion to,
and to the extent of, the positive balances standing in their respective
Unreturned Contribution Accounts, if any; and
(b)    Percentage Interests. Thereafter, to the Members in proportion to their
respective Percentage Interests.
5.02    Limitations on Distributions
Notwithstanding any other provision contained in this Agreement, the Company
shall not make a distribution of Cash Flow (or other proceeds) to any Member if
such distribution would violate Section 18-607 of the Delaware Act or other
applicable law.
5.03    Withholding
If the Company is obligated to withhold and pay any taxes with respect to any
Member, then any tax required to be withheld may be withheld from any
distribution otherwise payable to such Member. Any such amounts withheld and
remitted to the appropriate tax authority shall be deemed to have been
distributed to the applicable Member and applied by such Member in payment of
such tax liability.
5.04    In-Kind Distribution
Assets of the Company (other than cash) shall not be distributed in kind to the
Members without the prior written approval of the Members.

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ARTICLE VI
    
RESTRICTIONS ON TRANSFERS OF COMPANY INTERESTS
6.01    Limitations on Transfer
Except as otherwise set forth in Articles VI, VII and VIII, no Member shall be
entitled to sell, exchange, assign, transfer, or otherwise dispose of, pledge,
hypothecate, encumber or otherwise grant a security interest in (collectively,
the "Transfer"), directly or indirectly, all or any part of such Member's
Interest in the Company or withdraw or retire from the Company, without the
prior written consent of the other Member, which consent may be withheld in such
other Member's sole and absolute discretion. Any transfer of a direct or
indirect interest in any Member shall be deemed to be a Transfer for purposes of
this Agreement, provided, however, that any transfer of a direct or indirect
interest in a Member resulting from the death of such interest holder, the
transfer by such interest holder to a trust of which the interest holder and/or
his or her spouse is/are the sole current income beneficiaries or the
termination of a trust which is an interest holder shall not be deemed a
Transfer for purposes of this Agreement. Any attempted Transfer or withdrawal in
violation of the restrictions set forth in this Article VI shall be null and
void ab initio and of no force or effect to the maximum extent allowed by law.
6.02    Permitted Transfers
Any Member may Transfer all or any portion of such Member's Interest in the
Company to any of the following (collectively, "Permitted Transferees") without
complying with the provisions of Section 6.01:
(a)    Affiliates. In the case of either Member, to any Affiliate of such Member
provided the original transferring Member (that executed this Agreement) or its
direct or indirect owners at all times thereafter own more than fifty percent
(50%) of the voting and beneficial interests in such Affiliate;
(b)    Stock Transfers. In the case of any direct and/or indirect owner of any
Member that is a publicly traded corporation (including, without limitation, any
shareholder of Tejon Ranch Co., a Delaware corporation), to any Person;
(c)    Transfers of Direct or Indirect Interests in Majestic. Subject to the
last sentence of this Section 6.02(c), (i) any direct or indirect ownership
interest in Majestic may be transferred to any Person provided following such
transfer (A) Edward P. Roski, Jr. ("Roski") (individually and/or in his capacity
as trustee of a trust) directly or indirectly controls Majestic, and
(B) Majestic Realty Co., a California corporation ("MRC"), and/or Roski
(individually and/or in his capacity as trustee of a trust) own, in the
aggregate, directly or indirectly, at least thirty percent (30%) of Majestic,
and (ii) any direct or indirect ownership interest in Majestic may be
transferred to any member of the Roski Family provided that (A) prior to Roski's
death or incapacity, Roski remains (individually and/or in his capacity as
trustee of a trust), directly or indirectly, in control of Majestic, and
(B) following Roski's death or incapacity one (1) or more members of the Roski
Family control Majestic. The term "Roski Family" means Roski, his spouse, their
lineal descendants and their spouses, any trust or estate for the benefit of any
such party, and any entity owned or controlled (ownership and voting interests
in excess of 50%) by such parties.

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As used in this Section 6.02(c), the terms "control," "controls" and
"controlling" mean the possession by any Person, directly or indirectly, of the
power to direct or cause the direction of the management and policies of another
Person, whether through the ownership of voting securities, by contract or
otherwise. Notwithstanding the foregoing, whether or not a transfer of any
direct or indirect ownership interest in Majestic occurs, Majestic shall not be
permitted to allow any Person other than Roski (individually and/or in his
capacity as trustee of a trust) to control, directly or indirectly, Majestic
prior to the death or incapacity of Roski;
(d)    Tejon Ranchcorp Multi-Asset Transfer. In the case of Tejon, a transfer of
all, but not less than all, of its Interest in the Company as part of a
transaction in which one (1) or more members of the Tejon Group (as defined
below) in a single transaction or series of related transactions transfer five
(5) or more of its Real Estate Assets (as defined below) with a gross asset
value of at least Fifty Million Dollars ($50,000,000). For this purpose, the
term (i) “Tejon Group” means all corporations, partnerships and limited
liability companies in which Tejon Ranchcorp and/or any Affiliate thereof owns
in excess of fifty percent (50%) of the ownership and voting interests; and (ii)
“Real Estate Assets” means direct or indirect interests in any commercial or
industrial real property of any type, wherever located;
(e)    Majestic Multi-Asset Transfer. In the case of Majestic, a transfer of
all, but not less than all, of its Interest in the Company as part of a
transaction in which one (1) or more members of the Majestic Group (as defined
below) in a single transaction or series of related transactions transfer five
(5) or more of its Real Estate Assets with a gross asset value of at least Fifty
Million Dollars ($50,000,000). For this purpose, the term “Majestic Group” means
all corporations, partnerships and limited liability companies in which the
Roski Family owns in excess of fifty percent (50%) of the ownership and voting
interests;
(f)    Transfers as a Result of Foreclosure. In the case of either Member, to
any Person that acquires an Interest in the Company pursuant to Section 6.08
below as the result of the exercise of any rights or remedies under
Section 3.03(a); and
(g)    Right of First Refusal. In the case of either Member, to any Person
provided (i) such Transfer is for the transferring Member's entire Interest in
the Company, and (ii) the transferring Member fully complies with the provisions
of Exhibit "D."
Any such Permitted Transferee shall receive and hold such ownership interest or
portion thereof subject to the terms of this Agreement and to the obligations
hereunder of the transferor. There shall be no further transfer of such
ownership interest or portion thereof except to a Person to whom the original
transferor could have transferred such ownership interest in accordance with
this Section 6.02.

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Notwithstanding any other provision of this Agreement, no transfer described in
Section 6.02 shall be permitted if the consummation of such transfer would
result in (i) a technical termination of the Company under Section 708 of the
Code, unless the transferring Member agrees to pay any and all Losses incurred
by the Company as a result of any such termination, (ii) a change of ownership
causing reassessment of all or any portion of the Project for property tax
purposes under Section 60, et seq., of the California Revenue and Taxation Code,
unless the transferring Member agrees to pay any and all Losses incurred by the
Company as a result of any such reassessment, or (iii) a breach or violation of
any transfer restrictions contained in the loan documentation (and/or guaranty)
relative to any indebtedness encumbering all or any portion of the Project
and/or any other agreement governing the Company, unless such transfer
restrictions are waived by the non-transferring Member, the applicable lender
and/or the parties to such agreement, as the case may be.
6.03    Admission of Substituted Members
If any Member transfers such Member's Interest to a transferee in accordance
with Sections 6.01 and/or 6.02 above, then such transferee shall only be
entitled to be admitted into the Company as a substituted member (and this
Agreement shall be amended in accordance with the Delaware Act to reflect such
admission), if: (i) the non-transferring Member reasonably approves the form and
content of the instrument of transfer; (ii) the transferor and transferee named
therein execute and acknowledge such other instruments as the non-transferring
Member may deem reasonably necessary to effectuate such admission; (iii) the
transferee in writing accepts and adopts all of the terms and conditions of this
Agreement, as the same may have been amended; and (iv) the transferor pays, as
the non-transferring Member may reasonably determine, all reasonable expenses
incurred in connection with such admission, including, without limitation, legal
fees and costs. To the maximum extent permitted by law, any assignee of an
Interest who does not become a substituted member shall have no right to require
any information or account of the Company's transactions, to inspect the Company
books, or to vote on any of the matters as to which a member would be entitled
to vote under this Agreement. An assignee shall only be entitled to share in
such Net Profits and Net Losses, to receive such distributions, and to receive
such allocations of income, gain, loss, deduction or credit or similar items to
which the assignor was entitled, to the extent assigned. A Member that transfers
such Member's Interest shall not cease to be a member of the Company until the
admission of the assignee as a substituted member.
6.04    Election; Allocations between Transferor and Transferee
Upon the transfer of the Interest of any Member or the distribution of any
property of the Company to a Member, the Company shall file an election in
accordance with applicable Treasury Regulations, to cause the basis of the
Company property to be adjusted for federal income tax purposes as provided by
Sections 734 and 743 of the Code. Upon the transfer of all or any part of the
Interest of a Member as hereinabove provided, Net Profits and Net Losses shall
be allocated between the transferor and transferee on the basis of a computation
method that is in conformity with the methods prescribed by Section 706 of the
Code and Treasury Regulation Section 1.706-1(c)(2)(ii).

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6.05    Partition
No Member shall have the right to partition any assets of the Company or any
interest therein, nor shall a Member make application or proceeding for a
partition thereto and, upon any breach of the provisions of this Section 6.05 by
any Member, the other Member (in addition to all rights and remedies afforded by
law or equity) shall be entitled to a decree or order restraining or enjoining
such application, action or proceeding.
6.06    Waiver of Withdrawal and Purchase Rights
Except in connection with any transfer permitted in accordance with this
Agreement, no Member may voluntarily withdraw, resign or retire from the Company
without the prior written consent of the other Member, which consent may be
withheld in such other Member's sole and absolute discretion. In furtherance of
the foregoing, each Member hereby waives any and all rights such Member may have
to withdraw and/or resign from the Company pursuant to Section 18-603 of the
Delaware Act and hereby waives any and all rights such Member may have to
receive the fair value of such Member's Interest in the Company upon such
resignation and/or withdrawal pursuant to Section 18-604 of the Delaware Act.
6.07    No Appraisal Rights
Unless otherwise determined by the Members, none of the Members shall have any
appraisal rights with respect to their Interests pursuant to Section 18-210 of
the Delaware Act or otherwise.
6.08    Foreclosure of Interest
Notwithstanding any other terms of this Agreement, upon a foreclosure, sale or
other transfer of any Interest in the Company pursuant to any security interest
granted pursuant to Section 3.03(a), the holder of such Interest shall, upon the
execution of a counterpart to Agreement (or an amendment thereto), automatically
be admitted as a substituted member of the Company upon such foreclosure, sale
or other transfer, with all of the rights and obligations thereof permitted
hereunder. The Company acknowledges that the pledge of any Interest in the
Company pursuant to Section 3.03(a) shall be a pledge not only of Net Profits
and Net Losses of the Company, but also a pledge of all rights and obligations
of the pledgor thereunder. Upon a foreclosure, sale or other transfer of any
Interest in the Company pursuant to Section 3.03(a), the successor member may
transfer its Interest in the Company in accordance with this Agreement.
Notwithstanding any provision in the Delaware Act or any other provision
contained herein to the contrary, the pledgor under Section 3.03(a) shall be
permitted to pledge and, upon any foreclosure of such pledge in connection with
the admission of the secured party or other holder as a substituted member, to
transfer to the secured party or other holder its rights and obligations to the
Company pursuant to the terms of such pledge agreement.

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ARTICLE VII
    
MEMBER DEFAULT
7.01    Default Events
For purposes of this Article VII, the following shall constitute "Default
Events":
(a)    Breach of Agreement. The breach of any material covenant, duty or
obligation under this Agreement by any Member (other than a breach described in
Section 7.01(b) or 7.01(c) for which there shall be no cure period) if (i) the
breaching Member has received written notice from the other Member of the
breach, and (ii) (A) the breach is not reasonably susceptible of being cured, or
(B) if the breach is reasonably susceptible of being cured, the breaching Member
has failed to commence the cure or remedy of the breach within fifteen (15) days
following the effective date of the notice and failed to complete the cure or
remedy within a reasonable period of time (not to exceed 60 days), unless the
cure or remedy cannot be reasonably completed within such sixty (60)-day period
and the breaching Member fails to diligently proceed with the cure or remedy to
completion within an additional forty-five (45) days following the expiration of
such initial sixty (60)-day period;
(b)    Capital Default. The failure of a Member to make timely a contribution
required to be made pursuant to Section 3.02, or to timely repay any Default
Loan in accordance with Section 3.03(a), followed by the election of the
Contributing Member to treat such failure as a Default Event pursuant to
Section 3.03(c);
(c)    Prohibited Transfer, Encumbrance or Withdrawal. A Transfer or attempted
Transfer by a Member of such Member's Interest in the Company (or portion
thereof) or withdrawal or attempted withdrawal by a Member contrary to the
provisions of Article VI;
(d)    Bankruptcy or Insolvency. The rendering, by a court with appropriate
jurisdiction, of a decree or order (i) adjudging a Member bankrupt or insolvent,
or (ii) approving as properly filed a petition seeking reorganization,
readjustment, arrangement, composition, or similar relief for a Member under the
federal bankruptcy laws or any other similar applicable law or practice,
provided that such decree or order shall remain in force, undischarged and
unstayed, for a period of ninety (90) days;
(e)    Appointment of Receiver. The rendering, by a court with appropriate
jurisdiction, of a decree or order (i) for the appointment of a receiver, a
liquidator, or a trustee or assignee in bankruptcy or insolvency of a Member, or
for the winding up and liquidation of such Member's affairs, provided that such
decree or order shall have remained in force undischarged and unstayed for a
period of sixty (60) days, or (ii) for the sequestration or attachment of any
property of a Member without its return to the possession of such Member or its
release from such sequestration or attachment within sixty (60) days thereafter;
or
(f)    Bankruptcy Proceedings. A Member (i) institutes proceedings to be
adjudicated a voluntary bankrupt or an insolvent, (ii) consents to the filing of
a bankruptcy proceeding against such

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Member, (iii) files a petition or answer or consent seeking reorganization,
readjustment, arrangement, composition, or similar relief for such Member under
the federal bankruptcy laws or any other similar applicable law or practice,
(iv) consents to the filing of any such petition, or to the appointment of a
receiver, a liquidator, or a trustee or assignee in bankruptcy or insolvency for
such Member or a substantial part of such Member's property, (v) makes an
assignment for the benefit of such Member's creditors, (vi) is unable to or
admits in writing such Member's inability to pay such Member's debts generally
as they become due, or (vii) takes any action in furtherance of any of the
aforesaid purposes.
For the purposes of implementing the provisions contained in this Article VII,
the "Defaulting Member" shall be: (i) in the case of the event referenced in
Section 7.01(a), the Member that has breached any material covenant, duty or
obligation under this Agreement; (ii) in the case of the event referenced in
Section 7.01(b), the Non-Contributing Member; (iii) in the case of the
occurrence of the event referenced in Section 7.01(c), the Member that has
transferred such Member's rights or interests or withdrawn from the Company
contrary to the provisions of Article VI; and (iv) in the case of the occurrence
of any of the events referenced in Sections 7.01(d), (e) and/or (f), the Member
that is the subject of such court decree or order or has instituted such
proceedings or filed such petitions or who is insolvent, etc. The term
"Non-Defaulting Member" shall mean the Member that is not the Defaulting Member.
For the avoidance of doubt, any Default by an Affiliate of a Member under any
agreement between such Affiliate and the Company shall not constitute a Default
Event by the Member under this Agreement. A Member shall cease to be a
Defaulting Member solely for purposes of this Article VII following the
occurrence of a Default Event with respect to such Member if the Non-Defaulting
Member fails to deliver a Default Notice within the sixty (60)-day or ninety
(90)-day periods, as the case may be, set forth in Section 7.02, following the
occurrence of such Default Event.
7.02    Rights Arising From a Default Event
Within sixty (60) days after the date that the Non-Defaulting Member is aware of
the occurrence of an uncured Default Event (or ninety (90) days after the
occurrence of any default described in Section 7.01(b)) the Non-Defaulting
Member shall have the right, but not the obligation, to implement the default
procedures set forth in this Article VII by delivering written notice ("Default
Notice") thereof to the Defaulting Member. Failure of a Non-Defaulting Member to
deliver a Default Notice within such sixty (60)-day or ninety (90)-day period
shall not be deemed to be a waiver of the right to deliver a Default Notice upon
the occurrence of any subsequent Default Event.
7.03    Determination of Defaulting Member's Purchase Price
Within thirty (30) days after the determination of the Appraised Value of the
assets of the Company, the Accounting Firm shall determine the amount of cash
which would be distributed to each Member if (i) the assets of the Company were
sold for the Appraised Value thereof as of the effective date of the Default
Notice; (ii) the liabilities of the Company were liquidated pursuant to
Section 12.02(a); (iii) a reasonable reserve for any contingent, conditional or
unmatured liabilities or obligations of the Company was established by the
Non-Defaulting Member pursuant to Section 12.02(b); and (iv) any remaining
amounts were distributed to the Members in accordance with the provisions of
Section 12.02(c). Upon such determination, the Accounting Firm shall give each
Member written notice ("Accountant's Notice") thereof. The determination by the

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Accounting Firm of such amounts, including all components thereof, shall be
deemed conclusive absent any material computational error. In the case of a
Default Event described in Section 7.01(a), (b) or (c), ninety percent (90%),
and in all other cases, one hundred percent (100%), of the amount which would be
distributed to the Defaulting Member pursuant to Section 5.01 shall be deemed
the purchase price for the Defaulting Member's Interest (the "Defaulting
Member's Purchase Price") for purposes of this Article VII; subject, however, to
adjustment for any Default Loans as provided in Section 7.09.
(a)    Determination of Appraised Value. For purposes of this Article VII, the
appraised value ("Appraised Value") of the assets of the Company shall be
determined as follows: The Appraised Value shall be determined by one (1) or
more independent qualified M.A.I. appraisers with at least five (5) years'
experience appraising industrial real estate projects. The Non-Defaulting Member
shall select one (1) appraiser and shall include such selection in the Default
Notice. Within fifteen (15) Business Days following the effective date of the
Default Notice, the Defaulting Member shall either agree to the appraiser
selected by the Non-Defaulting Member or select a second (2nd) appraiser and
give written notice to the Non-Defaulting Member of the person so selected. If
either the Non-Defaulting Member or the Defaulting Member fails to appoint such
an appraiser within the time period specified and after the expiration of five
(5) Business Days following the effective date of written demand that an
appraiser be appointed, then the appraiser duly appointed by the Member making
such demand to appoint such appraiser shall proceed to make the appraisal as
herein set forth, and the determination thereof shall be conclusive on both of
the Members. If two (2) appraisers are selected, then such selected appraisers
shall thereafter appoint a third (3rd) appraiser. If the two (2) selected
appraisers fail to appoint a third (3rd) appraiser within ten (10) Business Days
following the effective date of written notice from the Defaulting Member
notifying the Non-Defaulting Member of the selection of the second (2nd)
appraiser, then any Member may petition a court of competent jurisdiction to
appoint a third (3rd) appraiser, in the same manner as provided for the
appointment of an arbitrator pursuant to California Code of Civil Procedure
Section 1281.6.
The appraiser or three (3) appraisers, as the case may be, shall promptly
determine a date for the completion of the appraisal, which shall not be later
than sixty (60) days from the effective date of appointment of the last
appraiser.
The appraiser(s) shall determine the Appraised Value by determining the fair
market value of the assets of the Company, such fair market value being the
fairest price estimated in the terms of money which the Company could obtain if
such assets were sold in the open market allowing a reasonable time to find a
purchaser who purchases with knowledge of the business of the Company at the
time of the occurrence of the Default Event.
Upon submission of the appraisals setting forth the opinions as to the Appraised
Value of the assets of the Company, the two (2) such appraisals which are
nearest in amount shall be retained, and the third (3rd) appraisal shall be
discarded. The average of the two (2) retained appraisals shall constitute the
Appraised Value of the assets of the Company for purposes of this Article VII;
unless one (1) appraisal is the mean of the other two (2) appraisals, in which
case such appraisal shall constitute the Appraised Value of the assets of the
Company for purposes of this Article VII.

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(b)    Payment of Costs. Except as provided below, the Non-Defaulting Member
shall pay for the services of the appraiser appointed by such Member, and the
Defaulting Member shall pay for the services of the appraiser appointed by such
Member. The cost of the services of the third (3rd) appraiser, if any, shall be
paid one-half (½) by the Non-Defaulting Member, on the one hand, and one-half
(½) by the Defaulting Member, on the other hand. The costs of the services of
the Accounting Firm and, in the event only one (1) appraiser is required, the
cost of the services of such appraiser, shall be paid one-half (½) by the
Non-Defaulting Member, on the one hand, and one-half (½) by the Defaulting
Member, on the other hand.
7.04    Non-Defaulting Members' Option
For a period of thirty (30) days after the effective date of the Accountant's
Notice, the Non-Defaulting Member shall have the right, but not the obligation,
to elect to purchase the entire Interest of the Defaulting Member for the
Defaulting Member's Purchase Price, and on the terms and conditions set forth in
this Article VII by giving written notice of such election to the Defaulting
Member within such thirty (30)-day period. Failure by the Non-Defaulting Member
to timely give written notice exercising such Member's right to elect to
purchase set forth in this Section 7.04 shall be deemed an election by such
Member to waive such right to purchase with respect to the particular Default
Event that triggered the application of the provisions of this Article VII.
7.05    Closing Adjustments
Within five (5) days before the actual date of the closing pursuant to
Section 7.06 below, the Accounting Firm shall recalculate the amount of cash
which would be distributed to each Member pursuant to Section 5.01, if such
amount were determined as of the closing date under Section 7.06 (in lieu of the
effective date of the Default Notice) taking into account any contributions
and/or distributions made after the effective date of the Default Notice. Upon
such determination, the Accounting Firm shall give each Member written notice
("Adjusted Accountant's Notice") thereof. The Accounting Firm shall reasonably
and in good faith adjust the Defaulting Member's Purchase Price, if and to the
extent necessary, to take into account the adjustments described in the Adjusted
Accountant's Notice and to take into account appropriate prorations that would
have been made if there had been an actual sale of the Project to a third party
as of the date of the closing under Section 7.06.
7.06    Closing of Purchase and Sale
The closing of a purchase and sale pursuant to this Article VII shall be held at
the principal office of the Company in California on a Business Day designated
by the Non-Defaulting Member that is not later than sixty (60) days after the
expiration of the thirty (30)-day period set forth in Section 7.04. The
Defaulting Member shall transfer to the purchasing Non-Defaulting Member (or
such Member's nominee(s)) the entire Interest of the Defaulting Member free and
clear of all liens, security interests, and competing claims and shall deliver
to the Non-Defaulting Member (or such Member's nominee(s)) such instruments of
transfer and such evidence of due authorization, execution, and delivery, and of
the absence of any such liens, security interests, or competing claims as the
Non-Defaulting Member (or such Member's nominee(s)) shall reasonably request.

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7.07    Representations and Warranties
At the closing, the Defaulting Member shall represent and warrant to the
Non-Defaulting Member that the sale of the Defaulting Member's Interest to the
Non-Defaulting Member (or its nominee) (i) does not violate, conflict with, or
result in a breach of any provisions of, or constitute a material default (or an
event which, with notice or lapse of time or both, would constitute a material
default) under any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, deed of trust, security or pledge agreement, license,
lease, franchise, permit, agreement or other instrument or obligation to which
the Defaulting Member is a party (exclusive of any such agreement or other
instrument or obligation to which the Company is a party), or (ii) violate any
judgment, ruling, order, writ, injunction, decree, statute, rule or regulation
applicable to the Defaulting Member or any of the other properties or assets of
the Defaulting Member. The Defaulting Member shall also represent and warrant to
the Non-Defaulting Member at such closing that no notice to, declaration, filing
or registration with, or authorization, consent or approval, or permit from, any
domestic or foreign governmental regulatory body or authority, or any Person, is
necessary in connection with the sale of its Interest to the Non-Defaulting
Member.
7.08    Payment of Defaulting Member's Purchase Price
The Non-Defaulting Member shall pay (or cause to be paid) the entire Defaulting
Member's Purchase Price by delivering at the closing a confirmed wire transfer
of readily available funds or one (1) or more certified or bank cashier's checks
made payable to the order of the Defaulting Member.
7.09    Repayment of Default Loans
The Defaulting Member's Purchase Price shall be offset at the closing of such
purchase by the then unpaid principal balance of any and all Default Loan(s)
(together with all accrued, unpaid interest thereon) made by the Non-Defaulting
Member to the Defaulting Member. Such Default Loan(s) (together with all
accrued, unpaid interest thereon) shall be deemed paid to the extent of such
offset, with such deemed payment to be applied first to the accrued interest
thereon and thereafter to the payment of the outstanding principal amount
thereof. If the Defaulting Member's Purchase Price is insufficient to fully
offset the then unpaid principal balance of any and all Default Loans (together
with all accrued, unpaid interest thereon) made by the Non-Defaulting Member to
the Defaulting Member, then the portion of any such Default Loan(s) (and
accrued, unpaid interest thereon) that remains outstanding following such offset
shall be required to be paid by the Defaulting Member at the closing referenced
in Section 7.06. Also, notwithstanding any other provision of this Agreement,
the unpaid balance of any and all Default Loan(s) (including all outstanding
principal amounts thereof and all accrued, unpaid interest thereon) made by the
Defaulting Member to the Non-Defaulting Member be required to be paid by the
Defaulting Member at the closing referenced in Section 7.06.

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7.10    Release and Indemnity
On or before the closing of a purchase and sale held pursuant to this
Article VII, the Non-Defaulting Member shall use such Member's reasonable and
good faith efforts to obtain written releases of the Defaulting Member and the
Defaulting Member's Affiliates from all liabilities under all Loan Documents and
all other liabilities of the Company for which Affiliates may have personal
liability, except to the extent caused by the fraud, bad faith, willful
misconduct, gross negligence or breach of this Agreement by the Defaulting
Member (or any Affiliate thereof). To the extent the Non-Defaulting Member is
unable to obtain such releases on or before the closing, the Non-Defaulting
Member and an Affiliate of the Non-Defaulting Member with a net worth reasonably
acceptable to the Defaulting Member shall jointly and severally indemnify,
defend and hold the Defaulting Member (and its Affiliates) wholly harmless from
and against all such liabilities and guaranties, except for any liabilities
arising out of the fraud, bad faith, willful misconduct, gross negligence or
breach of this Agreement by the Defaulting Member (or any Affiliate thereof).
7.11    Withdrawal of the Defaulting Member
If the Interest of the Defaulting Member is purchased by the Non-Defaulting
Member (or its nominee) pursuant to this Article VII, then, effective as of the
closing for such purchase, the Defaulting Member shall withdraw as a member of
the Company. Notwithstanding the foregoing, any indemnity of the Defaulting
Member and its Affiliates provided for under this Agreement including, without
limitation, under Section 10.02(b) shall survive the sale of the Interest of the
Defaulting Member and its withdrawal as a member of the Company.
7.12    Distribution of Reserves
The amount established by the Non-Defaulting Member for reserves pursuant to
Section 7.03(iii) above shall be invested by the Company into a separate
interest bearing account and shall be drawn upon solely to satisfy any
contingent, unmatured or conditional liabilities or obligations of the Company
in existence as of the effective date of the Default Notice for which such
reserve was established. Within one (1) year following the closing of the
purchase of the entire Interest of the Defaulting Member in the Company pursuant
to this Article VII, the Non-Defaulting Member shall pay to the Defaulting
Member an amount equal to the difference between the Defaulting Member's
Purchase Price determined pursuant to Section 7.03 and the amount that the
Defaulting Member's Purchase Price would have been equal to if (i) no reserves
had been established or deducted in calculating the Defaulting Member's Purchase
Price, and (ii) the amount used in determining the Defaulting Member's Purchase
Price under Section 7.03(iv) had been reduced by the aggregate amount of any
contingent, unmatured or conditional liabilities of the Company (for which such
reserve was established) that were actually paid by the Company during such one
(1)-year period. Any interest earned on the proceeds invested in the interest
bearing account shall be paid to the Defaulting Member in the same ratio as the
principal balance of such proceeds is distributed in accordance with this
Section 7.12.

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ARTICLE VIII
    
ELECTIVE BUY/SELL AGREEMENT
8.01    Buy/Sell Election
Either Member that is not a Defaulting Member (the "Electing Member") shall have
the right, but not the obligation, at any time after the Lockout Date or an
Impasse Event to elect to implement the buy/sell procedures set forth in this
Article VIII by delivering written notice of such election ("Election Notice")
to the other Member (the "Non-Electing Member"). The term "Lockout Date" means
two (2) years after the Effective Date. The Election Notice shall set forth a
stated value (the "Stated Value"), as determined in the sole and absolute
discretion of the Electing Member, for all of the assets of the Company. For
purposes of this Article VIII, a Member shall not be deemed to be a Defaulting
Member after the expiration of the sixty (60)-day or ninety (90)-day period, as
the case may be, set forth in Section 7.02.
8.02    Determination of the Purchase Price
Within ten (10) Business Days following the effective date of any Election
Notice (or as soon as reasonably possible thereafter), the Accounting Firm shall
determine the aggregate amount of cash which would be distributed to each Member
if (i) the assets of the Company were sold for their Stated Value as of the
effective date of the Election Notice; (ii) the liabilities of the Company were
liquidated pursuant to Section 12.02(a); (iii) a reserve was not established for
any contingent, conditional or unmatured liabilities or obligations of the
Company pursuant to Section 12.02(b); and (iv) any remaining amounts were
distributed to the Members in accordance with the provisions of Section 5.01.
Upon such determination, the Accounting Firm shall give each Member written
notice ("Price Determination Notice") thereof. The determination by the
Accounting Firm of such amounts including all components thereof, shall be
deemed conclusive on all of the Members, absent any material computational
error. One hundred percent (100%) of the amount that would be distributed to
each Member pursuant to Section 12.03(c) shall be deemed the purchase price
("Purchase Price") for such Member's Interest for purposes of this Article VIII;
subject, however, to adjustment for any Default Loans described in Section 8.08.
8.03    Non-Electing Member's Option
For a period of thirty (30) days following the effective date of the Price
Determination Notice, the Non-Electing Member shall have the option to elect by
delivering written notice (the "Purchase Notice") of such election to the
Electing Member within such thirty (30)-day period, either (i) to purchase the
Electing Member's entire Interest for the Purchase Price thereof, or (ii) to
sell such Non-Electing Member's entire Interest to the Electing Member for the
Purchase Price thereof. Failure of the Non-Electing Member to timely and validly
make an election in accordance with this Section 8.03 shall constitute an
election by such Non-Electing Member to sell such Non-Electing Member's entire
Interest for the Purchase Price thereof to the Electing Member.

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8.04    Deposit
WITHIN FIVE (5) BUSINESS DAYS AFTER THE EXPIRATION OF THE THIRTY (30)-DAY OPTION
PERIOD SET FORTH IN SECTION 8.03, THE BUYING MEMBER SHALL DEPOSIT INTO AN ESCROW
ACCOUNT ESTABLISHED BY THE BUYING MEMBER WITH A NATIONALLY RECOGNIZED TITLE
COMPANY, A DEPOSIT (THE "DEPOSIT") BY A WIRE TRANSFER OF IMMEDIATELY AVAILABLE
FEDERAL FUNDS IN AN AMOUNT EQUAL TO FIVE PERCENT (5%) OF THE PURCHASE PRICE,
WHICH SHALL BE NON-REFUNDABLE TO THE BUYING MEMBER IF THE CLOSING OF THE SALE
FAILS TO OCCUR AS A RESULT OF THE BUYING MEMBER'S DEFAULT. UPON THE CLOSING OF
THE SALE, THE DEPOSIT SHALL BE A CREDIT AGAINST THE PURCHASE PRICE. SUBJECT TO
SECTION 8.10, IF THE SALE FAILS TO OCCUR DUE TO THE BUYING MEMBER, THEN THE
SELLING MEMBER SHALL RETAIN THE DEPOSIT OF THE BUYING MEMBER AS LIQUIDATED
DAMAGES, AS ITS SOLE AND EXCLUSIVE REMEDY AT LAW IN CONNECTION WITH SUCH
DEFAULT. THE MEMBERS ACKNOWLEDGE THAT IT WOULD BE IMPRACTICAL AND EXTREMELY
DIFFICULT TO ESTIMATE THE DAMAGES WHICH THE SELLING MEMBER MAY SUFFER IN
CONNECTION WITH A DEFAULT BY THE BUYING MEMBER UNDER THIS ARTICLE VIII.
THEREFORE, SUBJECT TO SECTION 8.10, THE MEMBERS HAVE AGREED THAT A REASONABLE
ESTIMATE OF THE TOTAL NET DETRIMENT THAT ANY MEMBER WOULD SUFFER IN SUCH EVENT
IS AND SHALL BE THE RIGHT OF THE SELLING MEMBER TO RETAIN THE DEPOSIT AS
LIQUIDATED DAMAGES, AS ITS SOLE AND EXCLUSIVE REMEDY AT LAW UNDER THIS
ARTICLE VIII. THE MEMBERS EXPRESSLY ACKNOWLEDGE AND AGREE THAT THE RETENTION OF
THE DEPOSIT IS NOT INTENDED AS A FORFEITURE OR PENALTY WITHIN THE MEANING OF
DELAWARE LAW (OR CALIFORNIA CIVIL CODE SECTION 3375 OR 3369 OR UNDER ANY OTHER
STATE LAWS TO THE EXTENT DELAWARE LAW DOES NOT APPLY), BUT IS INTENDED TO
CONSTITUTE LIQUIDATED DAMAGES TO THE SELLING MEMBER PURSUANT TO DELAWARE LAW (OR
CALIFORNIA CIVIL CODE SECTIONS 1671, 1676 AND 1677 OR UNDER ANY OTHER STATE LAWS
TO THE EXTENT DELAWARE LAW DOES NOT APPLY). NOTHING CONTAINED HEREIN SHALL LIMIT
OR OTHERWISE AFFECT ANY RIGHTS THE SELLING MEMBER MAY HAVE TO OBTAIN SPECIFIC
PERFORMANCE AND, TO THE MAXIMUM EXTENT PERMITTED BY LAW, ANY OTHER EQUITABLE
REMEDIES. THE MEMBERS ACKNOWLEDGE THAT THEY HAVE BEEN ADVISED BY THEIR COUNSEL
WITH RESPECT TO THE FOREGOING PROVISIONS OF THIS SECTION 8.04 AND BY THEIR
INITIALS SET FORTH BELOW INDICATE THAT THE FOREGOING REMEDIES ARE FAIR AND
REASONABLE AND AGREE AND COVENANT NOT TO CONTEST THE VALIDITY OF SUCH REMEDY AS
A PENALTY, FORFEITURE OR OTHERWISE IN ANY COURT OF LAW (AND/OR IN ANY
ARBITRATION PROCEEDING).
/s/ HM, /s/ GB
INITIALS OF TEJON
/s/ BT, /s/ TS, /s/ ER
INITIALS OF MAJESTIC

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8.05    Closing Adjustments
Within five (5) days before the actual date of the closing pursuant to
Section 8.06 below, the Accounting Firm shall recalculate the amount of cash
which would be distributed to each Member pursuant to Section 5.01 if such
amount were determined as of the closing date under Section 8.06 (in lieu of the
effective date of the Election Notice) taking into account any contributions
and/or distributions that occur after the effective date of the Election Notice.
Upon such determination, the Accounting Firm shall give each Member written
notice ("Adjusted Price Determination Notice") thereof. The Accounting Firm
shall reasonably and in good faith adjust the Defaulting Member's Purchase
Price, if and to the extent necessary, to take into account the adjustments
described in the Adjusted Price Determination Notice and to take into account
appropriate prorations that would have been made if there had been an actual
sale of the Project to a third party.
8.06    Closing of Purchase and Sale
The closing of a purchase and sale held pursuant to this Article VIII shall be
held at the principal office of the Company on a Business Day designated by the
buying Member within sixty (60) days following the earlier of (i) the effective
date upon which the Non-Electing Member has delivered the Purchase Notice
pursuant to Section 8.03, or (ii) the expiration of the thirty (30)-day option
period set forth in Section 8.03. The selling Member shall transfer to the
buying Member (or the buying Member's nominee(s)) the entire Interest of the
selling Member free and clear of all liens, security interests, and competing
claims and shall deliver to the buying Member (or the buying Member's
nominee(s)) such instruments of transfer and such evidence of due authorization,
execution, and delivery, and of the absence of any such liens, security
interests, or competing claims, as the buying Member (or the buying Member's
nominee(s)) shall reasonably request. The Purchase Price for the selling
Member's Interest shall be paid by the buying Member by delivering at the
closing of a confirmed wire transfer of readily available funds or one (1) or
more certified or bank cashier's checks made payable to the selling Member in an
amount equal to the Purchase Price, less the amount of the Deposit paid by the
buying Member pursuant to Section 8.04 above (which shall be released to the
selling Member at the closing). Effective as of the closing for the purchase of
the selling Member's Interest, the selling Member shall withdraw as a member of
the Company. In connection with any such withdrawal, the buying Member may cause
any nominee designated in the sole and absolute discretion of such Member to be
admitted as a substituted member of the Company. Notwithstanding the foregoing,
any indemnity of the selling Member and its Affiliates provided for under this
Agreement including, without limitation, under Section 10.02(b) shall survive
the sale of the Interest of the selling Member and its withdrawal as a member of
the Company.
8.07    Representations and Warranties
At the closing, the selling Member shall represent and warrant to the buying
Member that the sale of the selling Member's Interest to the buying Member (or
its nominee) (i) does not violate, conflict with, or result in a breach of any
provisions of, or constitute a material default (or an event which, with notice
or lapse of time or both, would constitute a material default) under any of the
terms, conditions or provisions of any note, bond, mortgage, indenture, deed of
trust, security or pledge agreement, license, lease, franchise, permit,
agreement or

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other instrument or obligation to which the selling Member is a party (exclusive
of any such agreement or other instrument or obligation to which the Company is
a party), or (ii) violate any judgment, ruling, order, writ, injunction, decree,
statute, rule or regulation applicable to the selling Member or any of the other
properties or assets of the selling Member (exclusive of its Interest in the
Company). The selling Member shall also represent and warrant to the buying
Member at such closing that no notice to, declaration, filing or registration
with, or authorization, consent or approval, or permit from, any domestic or
foreign governmental regulatory body or authority, or any Person, is necessary
in connection with the sale of its Interest to the buying Member.
8.08    Repayment of Default Loans
The Purchase Price shall be offset at the closing of such purchase by the then
unpaid principal balance of any and all Default Loan(s) (together with all
accrued, unpaid interest thereon) made by the buying Member to the selling
Member. Such Default Loan(s) (together with all accrued, unpaid interest
thereon) shall be deemed paid to the extent of such offset, with such deemed
payment to be applied first to the accrued interest thereon and thereafter to
the payment of the outstanding principal amount thereof. If the Purchase Price
is insufficient to fully offset the then unpaid principal balance of any and all
Default Loan(s) (together with all accrued, unpaid interest thereon) made by the
buying Member to the selling Member, then the portion of any such Default
Loan(s) (and accrued, unpaid interest thereon) that remains outstanding
following such offset shall be required to be paid by the Defaulting Member at
the closing referenced in Section 8.06. Also, notwithstanding any provision of
this Agreement to the contrary, the unpaid balance of any and all Default
Loan(s) (including all outstanding principal amounts thereof and all accrued,
unpaid interest thereon) made by the selling Member to the buying Member shall
be required to be paid by the Defaulting Member at the closing referenced in
Section 8.06.
8.09    Release and Indemnity
On or before the closing of a purchase and sale held pursuant to this
Article VIII, the buying Member shall use such Member's reasonable and good
faith efforts to obtain written releases of the selling Member and the selling
Member's Affiliates from all liabilities under all Loan Documents and all other
liabilities of the Company for which the selling Member (and/or its Affiliates)
may have personal liability, except to the extent caused by the fraud, bad
faith, willful misconduct, gross negligence or breach of this Agreement by such
selling Member (or any Affiliate thereof). To the extent the buying Member is
unable to obtain such releases on or before the closing, the buying Member and
an Affiliate of the buying Member with a net worth reasonably acceptable to the
selling Member shall jointly and severally indemnify, defend and hold the
selling Member (and its Affiliates) wholly harmless from and against all such
liabilities and guaranties, except for any liabilities caused by the fraud, bad
faith, willful misconduct, gross negligence or breach of this Agreement by such
selling Member (or any Affiliate thereof).
8.10    Interim Event of Default
If any Member elects (or is deemed to elect) to be a buying Member in accordance
with the provisions of this Article VIII and defaults in its obligations to
timely and validly close any such purchase, then (i) the buying Member shall not
have any further right to deliver an Election Notice pursuant to Section 8.01
for a period of one (1) year after the date of such default, and (ii) the
selling Member shall have the right, but not the

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obligation, to elect to purchase the Interest of the defaulting Member by
delivering a Purchase Notice to such defaulting Member within thirty (30) days
following such default. If the selling Member makes the election described in
clause (ii) above, then the Purchase Price for the defaulting Member's Interest
shall be ninety percent (90%) of the amount that was otherwise determined under
Section 8.02 and such purchase and sale shall otherwise be on the other terms
and conditions set forth in this Article VIII. If the selling Member delivers a
Purchase Notice pursuant to this Section 8.10, then the selling Member shall not
be entitled to retain the Deposit under Section 8.04.
8.11    Application of Provisions
The Members acknowledge and agree that if either Member has timely and validly
delivered an Election Notice to the other Member and initiated the buy/sell
procedures set forth in this Article VIII, then such other Member shall be
precluded from delivering an Election Notice unless such buy/sell procedure has
been terminated.
ARTICLE IX
    
REPRESENTATIONS, WARRANTIES, COVENANTS AND OTHER MATTERS
9.01    Tejon Representations
As of the Effective Date, each of the statements in this Section 9.01 shall be a
true, accurate and full disclosure of all facts relevant to the matters
contained therein. Tejon hereby represents and warrants as follows for the sole
and exclusive benefit of Majestic, each of which is material and is being relied
upon by Majestic as of the Effective Date:
(a)    Due Formation. Tejon is a duly organized limited liability company
validly existing and in good standing under the laws of the State of California
and has the requisite power and authority to enter into and carry out the terms
of this Agreement;
(b)    Required Actions. All limited liability company action required to be
taken by Tejon to execute and deliver this Agreement has been taken by Tejon and
no further approval of any member, partner, shareholder, manager, officer,
board, court, or other body is necessary to permit Tejon to execute and deliver
this Agreement;
(c)    Binding Obligation. This Agreement and all other documents to be executed
and delivered by Tejon pursuant to the terms of this Agreement will on the date
such Agreement and documents are fully executed and delivered constitute legal,
valid, and binding obligations of Tejon, enforceable in accordance with their
terms, except as such enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
affecting generally the enforcement of creditors' rights, and statutes or rules
of equity concerning the enforcement of the remedy of specific performance
(collectively, the "Enforceability Exceptions");
(d)    No Consent. No notice to, declaration, filing or registration with, or
authorization, consent or approval, or permit from, any domestic or foreign
governmental regulatory body or authority,

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or any Person, is necessary in connection with (i) the execution and delivery of
this Agreement by Tejon, or (ii) the consummation and performance by Tejon of
the transactions contemplated by this Agreement (other than the usual and
customary consents and permits required to be issued in connection with the
development of the Property);
(e)    Violation of Law. Neither the execution and delivery of this Agreement by
Tejon, nor the consummation by Tejon of the transactions contemplated hereby,
nor compliance by Tejon with any of the provisions hereof will (i) violate,
conflict with, or result in a breach of any provisions of, or constitute a
material default (or an event which, with notice or lapse of time or both, would
constitute a material default) under, any note, bond, mortgage, indenture, deed
of trust, security or pledge agreement, license, lease, franchise, permit,
agreement or other instrument or obligation to which the Company and/or Tejon is
a party as of the Effective Date or to which the Company and/or Tejon or any of
the other properties or assets of the Company and/or Tejon may be subject as of
the Effective Date, or (ii) violate any judgment, ruling, order, writ,
injunction, decree, statute, rule or regulation applicable to the Company and/or
Tejon or any of the other properties or assets of the Company and/or Tejon as of
the Effective Date;
(f)    No Litigation. To the Actual Knowledge of Tejon, there is no litigation,
arbitration, legal or administrative suit, action, proceeding or investigation
of any kind, pending or threatened in writing (nor any basis therefor), which
questions, directly or indirectly, the validity or enforceability of this
Agreement as to Tejon;
(g)    No Member Obligations. Tejon has not incurred any other obligations or
liabilities (excluding any obligations or liabilities related to the Property)
which could individually or in the aggregate adversely affect Tejon's ability to
perform its obligations under this Agreement or which would become obligations
or liabilities of Majestic or the Company;
(h)    Anti-Terrorism. Neither Tejon, nor any of its Affiliates, nor any of
their respective partners, members, shareholders or other equity owners, and
none of their respective employees, officers or directors, is, nor will they
become, a Person with whom U.S. persons or entities are restricted from doing
business under regulations of Office of Foreign Asset Control ("OFAC") of the
Department of the Treasury (including those named on OFAC's Specially Designated
and Blocked Persons List) or under any statute, executive order (including the
September 24, 2001, Executive Order Blocking Property and Prohibiting
Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism),
or other governmental action and is not and will not engage in any dealings or
transactions or be otherwise associated with such Person;
(i)    No Plan Assets. Tejon does not hold the assets of any "employee benefit
plan" as defined by Section 3(3) of the Employee Retirement Income Security Act
of 1974, as amended, any "plan" as described by Section 4975(e)(1) of the
Internal Revenue Code of 1986, as amended, or any Person deemed to hold the plan
assets of the foregoing;

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(j)    Financial Statements. The financial statements previously delivered by
Tejon to Majestic fairly present the financial condition of Tejon as of the date
of such financial statements, and no material adverse change has occurred in the
financial condition of Tejon since such date;
(k)    Most Knowledgeable Individuals. Lyda, McMahon and Dean Brown ("Brown")
are the individuals employed or affiliated with Tejon that have the most
knowledge and information regarding the representations and warranties made in
this Section 9.01; and
(l)    No Untrue Statements. To the Actual Knowledge of Tejon, no
representation, warranty or covenant of Tejon in this Agreement contains or will
contain any untrue statement of material facts or omits or will omit to state
material facts necessary to make the statements or facts contained therein not
misleading.
The term "Actual Knowledge of Tejon" means the actual present knowledge of Lyda,
McMahon and Brown without regard to any imputed or constructive knowledge and
without any duty of inquiry or investigation. In no event shall Lyda, McMahon or
Brown have any liability for the breach of any of the representations or
warranties set forth in this Agreement.
9.02    Majestic Representations
As of the Effective Date, each of the statements in this Section 9.02 shall be a
true, accurate and full disclosure of all facts relevant to the matters
contained therein. Majestic hereby represents and warrants as follows for the
sole and exclusive benefit of Tejon, each of which is material and is being
relied upon by Tejon as of the Effective Date:
(a)    Due Formation. Majestic is a duly organized limited liability company
validly existing and in good standing under the laws of the State of Delaware
and has the requisite power and authority to enter into and carry out the terms
of this Agreement;
(b)    Required Actions. All corporate action required to be taken by Majestic
to execute and deliver this Agreement has been taken and no further approval of
any member, partner, shareholder, manager, officer, board, court, or other body
is necessary to permit Majestic to execute and deliver this Agreement;
(c)    Binding Obligation. This Agreement and all other documents to be executed
and delivered by Majestic pursuant to the terms of this Agreement will on the
date such Agreement and documents are fully executed and delivered constitute
legal, valid, and binding obligations of Majestic, enforceable in accordance
with their terms, except as such enforceability may be limited by any
Enforceability Exception;
(d)    No Consent. No notice to, declaration, filing or registration with, or
authorization, consent or approval, or permit from, any domestic or foreign
governmental regulatory body or authority, or any Person, is necessary in
connection with (i) the execution and delivery of this Agreement, or

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(ii) the consummation and performance by Majestic of the transactions
contemplated by this Agreement (other than the usual and customary consents and
permits required to be issued in connection with the development of the
Property);
(e)    Violation of Law. Neither the execution and delivery of this Agreement,
nor the consummation by Majestic of the transactions contemplated hereby, nor
compliance by Majestic with any of the provisions hereof will (i) violate,
conflict with, or result in a breach of any provisions of, or constitute a
material default (or an event which, with notice or lapse of time or both, would
constitute a material default) under, any note, bond, mortgage, indenture, deed
of trust, security or pledge agreement, license, lease, franchise, permit,
agreement or other instrument or obligation to which the Company and/or Majestic
is a party as of the Effective Date or to which the Company and/or Majestic or
any of the other properties or assets of the Company and/or Majestic may be
subject as of the Effective Date, or (ii) violate any judgment, ruling, order,
writ, injunction, decree, statute, rule or regulation applicable to the Company
and/or Majestic or any of the other properties or assets of the Company and/or
Majestic as of the Effective Date;
(f)    No Litigation. To the Actual Knowledge of Majestic, there is no
litigation, arbitration, legal or administrative suit, action, proceeding or
investigation of any kind, pending or threatened in writing (nor any basis
therefor), which questions, directly or indirectly, the validity or
enforceability of this Agreement to Majestic;
(g)    No Member Obligations. Majestic has not incurred any obligations or
liabilities which could individually or in the aggregate adversely affect
Majestic's ability to perform its obligations under this Agreement or which
would become obligations or liabilities of Tejon or the Company;
(h)    Anti-Terrorism. Neither Majestic, nor any of its Affiliates, nor any of
their respective partners, members, shareholders or other equity owners, and
none of their respective employees, officers or directors, is, nor will they
become, a Person with whom U.S. Persons are restricted from doing business under
regulations of OFAC (including those named on OFAC's Specially Designated and
Blocked Persons List) or under any statute, executive order (including the
September 24, 2001, Executive Order Blocking Property and Prohibiting
Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism),
or other governmental action and is not and will not engage in any dealings or
transactions or be otherwise associated with such Persons;
(i)    No Plan Assets. Majestic does not hold the assets of any "employee
benefit plan" as defined by Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended, any "plan" as described by Section 4975(e)(1)
of the Internal Revenue Code of 1986, as amended, or any entity deemed to hold
the plan assets of the foregoing;
(j)    Financial Statements. The financial statements previously delivered by
Tejon to Majestic fairly present the financial condition of Tejon as of the date
of such financial statements, and no material adverse change has occurred in the
financial condition of Tejon since such date;

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(k)    Most Knowledgeable Individuals. Brett Tremaine and Thomas Simmons are the
individuals employed or affiliated with Majestic that have the most knowledge
and information regarding the representations and warranties made in this
Section 9.02;
(l)    No Untrue Statements. To the Actual Knowledge of Majestic, no
representation, warranty or covenant of Majestic in this Agreement contains any
untrue statement of material facts or omits to state material facts necessary to
make the statements or facts contained therein not misleading.
The term "Actual Knowledge of Majestic" means the actual present knowledge of
Brett Tremaine and Thomas Simmons without regard to any imputed or constructive
knowledge and without any duty of inquiry or investigation. In no event shall
Brett Tremaine or Thomas Simmons have any liability for the breach of any of the
representations or warranties set forth in this Agreement.
9.03    Brokerage Fee Representation and Indemnity
Each Member hereby represents that such Member has not retained any broker,
finder, agent or the like in connection with this Agreement or the transactions
contemplated herein. Each Member hereby agrees to indemnify, defend and hold the
other Member wholly harmless from and against all Losses arising out of any
claim for brokerage or other commissions relative to this Agreement, or the
transactions contemplated herein insofar as any such claim arises by reason of
services alleged to have been rendered to or at the insistence of such
indemnifying party. No Member shall receive any credit to its Capital Account or
Unreturned Contribution Account or otherwise be reimbursed by the Company for
any amounts paid by such Member pursuant to this Section 9.03.
9.04    Investment Representations
Each Member agrees as follows with respect to investment representations:
(a)    Member Understandings. Each Member understands the following:
(i)    No Registration. That the Interests in the Company evidenced by this
Agreement have not been registered under the Securities Act of 1933, 15 U.S.C. §
15b et seq., the Delaware Securities Act, the California Corporate Securities
Law of 1968 or any other state securities laws (the "Securities Acts") because
the Company is issuing Interests in the Company in reliance upon the exemptions
from the registration requirements of the Securities Acts providing for issuance
of securities not involving a public offering;
(ii)    Reliance by the Company. That the Company has relied upon the
representation made by each Member that the Interest issued to such Member is to
be held by such Member for investment; and
(iii)    No Distribution. That exemption from registration under the Securities
Acts would not be available if any Interest in the Company was acquired by a
Member with a view to distribution. Each Member agrees that the Company is under
no obligation to register the Interests or to assist the Members in complying
with any exemption from registration under the

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Securities Acts if the Member should at a later date wish to dispose of such its
Interest in the Company.
(b)    Acquisition for Own Account. Each Member hereby represents to the Company
that such Member is acquiring its Interest in the Company for such Member's own
account, for investment and not with a view to resale or distribution.
(c)    No Public Market. Each Member recognizes that no public market exists
with respect to the Interests and no representation has been made that such a
public market will exist at a future date.
(d)    No Advertisement. Each Member hereby represents that such Member has not
received any advertisement or general solicitation with respect to the sale of
the Interests.
(e)    Pre-Existing Business Relationship. Each Member acknowledges that such
Member has a preexisting personal or business relationship with the Company or
its officers, directors, or principal interest holders, or, by reason of such
Member's business or financial experience or the business or financial
experience of such Member's financial advisors (who are not affiliated with the
Company), could be reasonably assumed to have the capacity to protect such
Member's own interest in connection with the acquisition of its Interest. Each
Member further acknowledges that such Member is familiar with the financial
condition and prospects of the Company's business, and has discussed with the
other Member the current activities of the Company. Each Member believes that
the Interest is a security of the kind such Member wishes to purchase and hold
for investment, and that the nature and amount of the Interest is consistent
with such Member's investment program.
(f)    Due Investigation. Before acquiring any Interest in the Company, each
Member has investigated the Company and its business and the Company has made
available to each Member all information necessary for the Member to make an
informed decision to acquire an Interest in the Company. Each Member considers
itself to be a Person possessing experience and sophistication as an investor
adequate for the evaluation of the merits and risks of the Member's investment
in the Company.
9.05    Indemnification Obligations
In addition to the indemnity described in Section 9.03 above, each Member hereby
unconditionally and irrevocably covenants and agrees to indemnify, defend and
hold harmless the Company, the other Member and such other Member's partners,
members, shareholders, officers, directors, employees, agents and other
representatives (collectively, the "Affiliated Parties") from and against any
and all Losses incurred by the other Member and/or such Affiliated Parties
resulting from or arising out of any material inaccuracy or material breach of
any representations or warranties made by such Member under this Agreement. No
Member shall receive any credit to its Capital Account or Unreturned
Contribution Account or otherwise be reimbursed by the Company for any amounts
paid by such Member pursuant to this Section 9.05.

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9.06    Survival of Representations, Warranties and Covenants
Each Member understands the meaning and consequences of the representations,
warranties and covenants made by such Member set forth in this Article IX and
that the Company and the other Member have relied upon such representations,
warranties and covenants. All representations, warranties and covenants
contained in this Article IX shall survive the execution of this Agreement, the
formation of the Company, the withdrawal of any Member as a member of the
Company and the liquidation of the Company.
ARTICLE X
    
LIABILITY, EXCULPATION, RESTRICTIONS ON COMPETITION,
FIDUCIARY DUTIES AND INDEMNIFICATION
10.01    Liability for Company Claims
Except as otherwise provided by this Agreement, the Delaware Act and/or any
other applicable law, the debts, obligations and liabilities of the Company,
whether arising in contract, tort or otherwise, shall be solely the debts,
obligations and liabilities of the Company, and no Member shall be obligated
personally for any such debt, obligation or liability of the Company solely by
reason of being a member of the Company.
10.02    Exculpation, Indemnity and Reliance on Information
The Members hereby agree to the exculpation, indemnity and other provisions set
forth below as follows:
(a)    Liability. No authorized Person, Member or Officer of the Company, or, if
designated by the Executive Committee, any Affiliate or any direct and indirect
members, partners, shareholders, directors, officers, managers, trustees and
employees of any Member (collectively, the "Covered Persons") shall be liable or
accountable in damages or otherwise to the Company or to any Member for any
error of judgment or any mistake of fact or law or for anything that such
Covered Person may do or refrain from doing hereafter, except to the extent
caused by such Covered Person's fraud, bad faith, willful misconduct, gross
negligence or breach of this Agreement.
(b)    Indemnity. To the maximum extent permitted by applicable law as it
presently exists or may hereafter be amended, the Company hereby agrees to
indemnify, defend (with counsel selected by the Executive Committee), protect
and hold harmless, each Covered Person, from and against any and all Losses
incurred by such Covered Person by reason of anything which such Covered Person
may do or refrain from doing that arises out of or relates to the Company to the
extent such Losses are not covered by insurance maintained by or for the benefit
of such Covered Person. The foregoing obligation of the Company to indemnify,
protect, defend and hold harmless each Covered Person shall extend to any Losses
incurred by any Guarantor under any Loan Document (or as a result of the rights
of contribution described in Section 3.05). Notwithstanding the foregoing terms
of this Section 10.02(b), no Covered Person (including any Guarantor) shall be
entitled to be indemnified by the Company to the extent any such Losses are
incurred by such Covered Person by reason of such Covered Person's fraud,

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bad faith, willful misconduct, gross negligence or breach of this Agreement
(other than a failure to pay any amounts due under any such Loan Document as a
result of the breach or default of the Company).
The Administrative Member may cause the Company to pay any costs and/or expenses
incurred by any Covered Person in defending any civil, criminal, administrative
or investigative action, suit or proceeding prior to the final disposition of
such action, suit or proceeding upon receipt of any undertaking by or on behalf
of such Covered Person (or, in the Executive Committee's reasonable discretion,
a creditworthy Affiliate thereof) to repay such amount if it shall ultimately be
determined that such Covered Person is not entitled to be indemnified by the
Company as authorized in this Section 10.02(b). The obligation of the Company to
indemnify, defend, protect and hold harmless each Covered Person under any
provision of this Agreement shall survive the withdrawal of any Member from the
Company and/or the liquidation of the Company, in each case solely to the extent
such obligation of the Company arose prior to such withdrawal or liquidation.
If a claim for indemnification or payment of expenses under this
Section 10.02(b) is not paid in full within thirty (30) calendar days after a
written claim therefor by the Covered Person has been received by the Company,
then the Covered Person may initiate an action to recover the unpaid amount of
such claim and, if successful in whole or in part, shall be entitled to be paid
the expense of prosecuting such claim. In any such action, the Covered Person
shall have the burden of proving that the Covered Person was entitled to the
requested indemnification or payment of expenses under applicable law.
(c)    Reliance upon Information, Opinions, Reports, etc. A Covered Person shall
be fully protected in relying in good faith upon the records of the Company, any
information received by any Member or the Company with respect to the Project
(financial or otherwise), and upon such information, opinions, reports or
statements presented to the Company by any Person as to matters the Covered
Person reasonably believes are within such other Person's professional or expert
competence including, without limitation, information, opinions, reports or
statements as to the value and amount of the assets, liabilities, profits,
losses or cash flow or any other facts pertinent to the existence and amount of
assets from which distributions to Members might properly be paid.
10.03    Limitation on Liability
Notwithstanding anything to the contrary contained in this Agreement (and
without limiting any liability a party may have under the Delaware Act or other
applicable law to return any distribution received by such party), no direct or
indirect member, manager, partner, shareholder, officer, director, trustee or
employee in or of any Member (collectively, the "Nonrecourse Parties") shall be
personally liable in any manner or to any extent under or in connection with
this Agreement, and neither any Member nor the Company shall have any recourse
to any assets of any of the Nonrecourse Parties. Neither any Member nor any
Nonrecourse Party shall have any liability for any punitive damages, lost
profits, special damages or consequential damages based on any claim that arises
out of or relates to this Agreement and/or the Company. The limitations on
liability provided in this Section 10.03 is in addition to, and not in
limitation of, any limitation on liability applicable to any Member or
Nonrecourse Party provided by law or by this Agreement or any other contract,
agreement or instrument.

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10.04    Activities of the Members and Their Affiliates
Subject to the terms hereof, each Member and their respective Affiliates, direct
and indirect members, partners, shareholders, directors, managers, officers,
employees, agents and trustees shall only be required to devote so much of their
time to the business and affairs of the Company as is determined in the
reasonable discretion of each such party. Neither Member nor any of its direct
and indirect Affiliates, members, partners, shareholders, directors, officers,
managers, employees, agents or trustees shall be prohibited from engaging in
other businesses whether or not similar to the business of the Company.
10.05    Fiduciary Duties
The fiduciary duties otherwise owed by the Members to each other under the
Delaware Act or otherwise are limited as follows:
(a)    Other Activities. Except as otherwise provided by this Agreement, to the
maximum extent allowed by law, neither Member shall have any obligations
(fiduciary or otherwise) with respect to the Company or to the other Member
insofar as making other investment opportunities available to the Company or to
the other Member. Except as otherwise provided in this Agreement, each Member
may engage in whatever activities such Member may choose, whether the same are
competitive with the Company or otherwise, without having or incurring any
obligation to offer any interest in such activities to the Company or to the
other Member. Except as otherwise provided in this Agreement, neither this
Agreement nor any activities undertaken pursuant hereto shall prevent either
Member from engaging in such activities, and to the maximum extent allowed by
law, the fiduciary duties of the Members to each other and to the Company shall
be limited solely to those arising from the business of the Company.
EACH MEMBER AGREES THAT THE MODIFICATION AND WAIVER OF THE FIDUCIARY DUTIES OF
EACH MEMBER PURSUANT TO THIS ARTICLE X ARE FAIR AND REASONABLE AND HAVE BEEN
UNDERTAKEN WITH THE INFORMED CONSENT OF EACH MEMBER. TO THE MAXIMUM EXTENT
ALLOWED BY LAW, EACH MEMBER AGREES AND COVENANTS NOT TO CONTEST THE VALIDITY OF
THE PROVISIONS OF THIS SECTION IN ANY COURT OF LAW (AND/OR IN ANY OTHER
PROCEEDING).
(b)    Good Faith and Fair Dealing. Except as otherwise provided by this
Agreement, each Member intends to limit the standard of care, degree of loyalty
and fiduciary duties to the maximum extent allowed by law; provided, however,
the foregoing shall not eliminate the implied contractual covenant of good faith
and fair dealing. Without limiting the generality of the foregoing, each Member
may exercise any of its rights and remedies under this Agreement without regard
to any fiduciary duties that are owed to the Company or the other Member
including, without limitation, the remedies set forth in Section 3.03 and
Articles VII and VIII.

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10.06    Non-Exclusivity of Rights
Except as otherwise provided in this Agreement, the rights conferred on any
Person by this Article X shall not be exclusive of any other rights which such
Person may have or hereafter acquire under any applicable law.
10.07    Amendment or Repeal
Any repeal or modification of the foregoing provisions of this Article X shall
not adversely affect any right or protection hereunder of any Person in respect
of any act or omission occurring prior to the time of such repeal or
modification.
10.08    Insurance
The Company may purchase and maintain insurance, to the extent and in such
amounts as are determined by the Executive Committee on behalf of the Covered
Persons and such other Persons as the Executive Committee shall determine in its
reasonable discretion, against any liability or claim that may be asserted
against or expenses that may be incurred by any such Person in connection with
the activities of the Company or such indemnities, regardless of whether the
Company would have the power to indemnify such Person against such liability
under the provisions of this Agreement. The Company may enter into indemnity
contracts with Covered Persons and such other Persons as the Executive Committee
shall determine and adopt written procedures pursuant to which arrangements are
made for the advancement of expenses and the funding of obligations under
Section 10.02(b) hereof and containing such other procedures regarding
indemnifications as are appropriate.
ARTICLE XI
    
BOOKS AND RECORDS
11.01    Books of Account and Bank Accounts
The Fiscal Year and taxable year of the Company shall be the year ending
December 31. The Administrative Member shall maintain accurate and complete
books of account and records showing the assets and liabilities, operations,
transactions and financial condition of the Company on an accrual basis in
accordance with Generally Accepted Accounting Principles, consistently applied.
The Administrative Member shall also provide to the other Member within fifteen
(15) days after the end of each calendar month (i) an unaudited monthly Net Cash
Flow statement setting forth the calculation of Net Cash Flow and all
disbursements of cash by the Company, and (ii) an unaudited statement of
continuing operations for the Company, including a balance sheet for the
Company, as of the end of the month, and a profit and loss statement for the
month. The Administrative Member shall also provide to the other Member within
fifteen (15) days after the end of each calendar quarter a detailed description
of any material deviations from the Approved Business Plan during the preceding
calendar quarter. Promptly after written request by the other Member, the
Administrative Member shall deliver such other information as is reasonably
requested by the other Member. The Administrative Member shall also provide on
an annual basis within thirty (30) calendar days after each

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calendar year annual unaudited statements of the operations of the Company
including (A) statement of net assets (balance sheet); (B) statement of
operations; (C) statement of cash flows; and (D) statement of changes in
Members' capital. The annual financial reports shall be delivered together with
a written statement by the Administrative Member that includes (1) a
representation by the Administrative Member that such annual statements fairly
represent the financial condition of the Company, and (2) a representation by
the Administrative Member that such financial statements have been prepared in
accordance Generally Accepted Accounting Principles, consistently applied.
Upon not less than seventy-two (72) hours prior notice, the Administrative
Member shall cooperate with the other Member, at the Company's sole cost and
expense, to conduct an independent inspection and review of the books and
records of the Company. The other Member shall have the authority to authorize
the preparation of audited financial statements for the Company. The failure by
the Administrative Member to deliver or otherwise cooperate timely with any item
to be delivered or request made in accordance with the requirements of this
Section 11.01 shall be considered a material breach of the Administrative
Member's obligations under this Agreement (provided the foregoing shall not
limit any cure rights the Adiministrative Member may have with respect to such
breach under Section 2.11(c) or 7.01(a) above).
During normal business hours at the office of the Company, on not less than
forty-eight (48) hours prior notice, all of the following shall be made
available for inspection and copying by each Member at its own expense: (i) all
books and records relating to the business and financial condition of the
Company, (ii) a current list of the name and last known business, residence or
mailing address of each Member, (iii) a copy of this Agreement, the Certificate
of Formation for the Company and all amendments thereto, together with executed
copies of any written powers-of-attorney pursuant to which this Agreement, the
Certificate of Formation and all amendments thereto have been executed, (iv) the
amount of cash and a description and statement of the agreed value of any other
property or services contributed by each Member to the capital of the Company
and which each Member has agreed to contribute in the future, and (v) the date
upon which each Member became a member of the Company.
11.02    Tax Returns
The Administrative Member shall cause to be prepared and timely filed and
distributed to each Member, at the expense of the Company (and prepared by an
accounting firm approved by the Executive Committee), all required federal and
state tax returns for the Company which shall be delivered to the Members by no
later than March 31 each year. The failure by the Administrative Member to
deliver timely any tax return in accordance with the requirements of this
Section 11.02 shall be considered a material breach of the Administrative
Member's obligations under this Agreement if (i) such failure is not caused by
the other Member's delay in delivering any information reasonably and timely
requested in writing by the Administrative Member, and (ii) such failure is not
caused by the accounting firm's failure to prepare such tax returns within the
estimated timeframe provided by the accounting firm or any failure by the
Executive Committee to agree on any accounting treatment or election (provided
the foregoing shall not limit any cure rights the Adiministrative Member may
have with respect to such breach under Section 2.11(c) or 7.01(a) above).

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The Administrative Member is hereby designated as the "tax matters partner" of
the Company as determined in accordance with the provisions of
Section 6231(a)(7) of the Code and the Treasury Regulations promulgated
thereunder. Following any resignation or removal of Majestic as the
Administrative Member of the Company, Tejon shall be the "tax matters partner"
of the Company. The Administrative Member (or Tejon if it has replaced Majestic
as the "tax matters partner" of the Company) is specifically directed and
authorized to (x) take whatever steps may be necessary or desirable to perfect
its designation as "tax matters partner," including filing any forms or
documents with the IRS, and (y) take such other action as may from time to time
be required under the Code and the Regulations. The "tax matters partner" of the
Company shall cause each other Member to be a "Notice Partner" within the
meaning of Code Section 6231(a)(8). The "tax matters partner" of the Company
shall be entitled to be reimbursed by the Company for all reasonable third-party
out-of-pocket costs and expenses incurred in connection with any tax proceeding
relating to the Company. Notwithstanding the foregoing, the "tax matters
partner" of the Company shall (i) provide the Members with prompt notice and
copies of all communications with the IRS, (ii) reasonably consult with the
Members regarding the resolution of any disputes with the IRS, and (iii) not
settle any such dispute, extend the statute of limitations with respect to such
dispute, or take any other material action that would bind the Company or the
Members in connection with such dispute, unless such decision is approved as a
Major Decision. For taxable years beginning after 2017, the Administrative
Member is hereby designated as the "partnership representative" of the Company
(provided the Administrative Member shall not be authorized to take any action
as the "partnership representative" of the Company that would require the
consent of the Executive Committee if such action was taken by the "tax matters
partner" of the Company). As the "partnership representative" of the Company,
the Administrative Member will have the right to make an election to treat any
"partnership adjustment" as an adjustment to be taken into account by each
Member (and former member) in accordance with Section 6226 of the Code.
ARTICLE XII
    
DISSOLUTION AND WINDING UP OF THE COMPANY
12.01    Events Causing Dissolution of the Company
Upon any Member's bankruptcy, resignation, withdrawal, expulsion or other
cessation to serve or the admission of a new member into the Company, the
Company shall not dissolve but the business of the Company shall continue
without interruption or break in continuity. However, the Company shall be
dissolved and its affairs wound up upon the first to occur of any of the
following events:
(a)    Sale of Assets. The sale, transfer or other disposition by the Company of
all or substantially all of its assets and the collection by the Company of all
consideration received in such transaction (including, without limitation, the
collection of any promissory note received by the Company);

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(b)    Election of Members. The affirmative election of the Executive Committee
to dissolve the Company; or
(c)    Decree of Dissolution. The entry of a decree of judicial dissolution
pursuant to Section 18-802 of the Delaware Act.
Except as provided above in this Section 12.01, neither Member shall have the
right to, and each Member hereby waives to the maximum extent allowed by law the
right to, unilaterally seek to dissolve or cause the dissolution of the Company
or to unilaterally seek to cause a partial or whole distribution or sale of
Company assets whether by court action or otherwise, it being agreed that any
actual or attempted dissolution, distribution or sale would cause a substantial
hardship to the Company and the other Member.
12.02    Winding Up of the Company
Upon the Liquidation of the Company caused by other than the termination of the
Company under Section 708(b)(1)(b) of the Code (in which latter case the Company
shall remain in existence in accordance with the provisions of such Section of
the Code), the Administrative Member shall proceed to the winding up of the
business and affairs of the Company. During such winding up process, the Net
Profits, Net Losses and Cash Flow distributions shall continue to be shared by
the Members in accordance with this Agreement. The assets shall be liquidated as
promptly as consistent with obtaining a fair value therefor, and the proceeds
therefrom, to the extent available, shall be applied and distributed by the
Company on or before the end of the taxable year of such Liquidation or, if
later, within ninety (90) days after such Liquidation, in the following order:
(a)    Creditors. First, to creditors of the Company (including Members who are
creditors) in the order of priority as provided by law;
(b)    Reserves. Second, to establishing any reserves which the Administrative
Member reasonably determines are necessary for any contingent, conditional or
unmatured liabilities or obligations of the Company; and
(c)    Remaining Amounts. Thereafter, to the Members in the order of priority
set forth in Section 5.01.
Any reserves withheld pursuant to Section 12.02(b) shall be distributed as soon
as practicable, as determined in the reasonable discretion of the Administrative
Member, in the order of priority set forth in Section 12.02(c).
The Members believe and intend that the effect of making any and all liquidating
distributions in accordance with the provisions of Section 12.02(c) shall result
in such liquidating distributions being made to the Members in proportion to the
positive balances standing in their respective Capital Accounts. If this is not
the result, then the Administrative Member, upon the advice of tax counsel to
the Company, is hereby authorized to make such amendments to the provisions of
Article IV that are reasonably approved by the Executive Committee as may be
necessary to cause such allocations to be in compliance with Code Section 704(b)
and the Treasury Regulations promulgated thereunder.

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12.03    Negative Capital Account Restoration
No Member shall have any obligation whatsoever upon the Liquidation of such
Member's Interest, the Liquidation of the Company or in any other event, to
contribute all or any portion of any negative balance standing in such Member's
Capital Account to the Company, to the other Member or to any other Person.
ARTICLE XIII
    
MISCELLANEOUS
13.01    Amendments
This Agreement may be amended and/or modified only with the written approval of
both Members.
13.02    Waiver of Conflict Interest
EACH MEMBER HEREBY ACKNOWLEDGES AND AGREES THAT, IN CONNECTION WITH THE
DRAFTING, PREPARATION AND NEGOTIATION OF THIS AGREEMENT, THE FORMATION OF THE
COMPANY AND ALL OTHER MATTERS RELATED THERETO, (I) ALLEN MATKINS LECK GAMBLE
MALLORY & NATSIS LLP HAS ONLY REPRESENTED THE INTERESTS OF TEJON, AND NOT THE
INTERESTS OF MAJESTIC, THE COMPANY OR ANY OTHER PARTY, AND (II) GREENBERG
GLUSKER FIELDS CLAMAN & MACHTINGER LLP HAS ONLY REPRESENTED THE INTERESTS OF
MAJESTIC AND NOT THE INTERESTS OF TEJON, THE COMPANY OR ANY OTHER PARTY. THE
ATTORNEYS, ACCOUNTANTS AND OTHER EXPERTS WHO PERFORM SERVICES FOR ANY MEMBER MAY
ALSO PERFORM SERVICES FOR THE COMPANY. TO THE EXTENT THAT THE FOREGOING
REPRESENTATION CONSTITUTES A CONFLICT OF INTEREST, THE COMPANY AND EACH MEMBER
HEREBY EXPRESSLY WAIVES ANY SUCH CONFLICT OF INTEREST. EACH MEMBER FURTHER
ACKNOWLEDGES THAT THE ATTORNEYS, ACCOUNTANTS AND OTHER EXPERTS WHO PERFORM
SERVICES FOR THE COMPANY SHALL NOT BE DEEMED BY VIRTUE OF SUCH REPRESENTATION TO
HAVE ALSO REPRESENTED ANY OTHER PARTY IN CONNECTION WITH ANY SUCH MATTERS.
13.03    Partnership Intended Solely for Tax Purposes
The Members have formed the Company as a Delaware limited liability company
under the Delaware Act, and do not intend to form a corporation or a general or
limited partnership under California or any other state law. The Members intend
the Company to be classified and treated as a partnership solely for federal and
state income taxation purposes. Each Member agrees to act consistently with the
foregoing provisions of this Section 13.03 for all purposes, including, without
limitation, for purposes of reporting the transactions contemplated herein to
the Internal Revenue Service and all state and local taxing authorities.

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13.04    Notices
All notices or other communications required or permitted hereunder shall be in
writing, and shall be delivered or sent, as the case may be, by any of the
following methods: (i) personal delivery, (ii) overnight commercial carrier,
(iii) registered or certified mail, postage prepaid, return receipt requested,
or (iv) facsimile or email. Any such notice or other communication shall be
deemed received and effective upon the earlier of (A) if personally delivered,
the date of delivery to the address of the Person to receive such notice; (B) if
delivered by overnight commercial carrier, one (1) day following the receipt of
such communication by such carrier from the sender, as shown on the sender's
delivery invoice from such carrier; (C) if mailed, on the date of delivery as
shown by the sender's registry or certification receipt; or (D) if given by
facsimile or email, when sent if received by the intended recipient of such
facsimile or email prior to 5:00 p.m. on a Business Day or on the next Business
Day if not received by the recipient of such facsimile prior to 5:00 p.m. on a
Business Day. Any notice or other communication sent by facsimile or email must
be confirmed within two (2) Business Days by letter mailed or delivered in
accordance with the foregoing to be effective. Any reference herein to the date
of receipt, delivery, or giving, or effective date, as the case may be, of any
notice or communication shall refer to the date such communication becomes
effective under the terms of this Section 13.04. Any such notice or other
communication so delivered shall be addressed to the party to be served at the
address for such party set forth in Section 1.02. The address for either Member
may be changed by giving written notice to the other Member in the manner set
forth in this Section 13.04. Rejection or other refusal to accept or the
inability to deliver because of changed address of which no notice was given
shall be deemed to constitute receipt of the notice or other communication sent.
13.05    Construction of Agreement
The Article and Section headings of this Agreement are used herein for reference
purposes only and shall not govern, limit, or be used in construing this
Agreement or any provision hereof. Each of the Exhibits attached hereto is
incorporated herein by reference and expressly made a part of this Agreement for
all purposes. References to any Exhibit made in this Agreement shall be deemed
to include this reference and incorporation. Where the context so requires, the
use of the neuter gender shall include the masculine and feminine genders, the
masculine gender shall include the feminine and neuter genders, the feminine
gender shall include the masculine and neuter genders, and the singular number
shall include the plural and vice versa. Each Member acknowledges that (i) each
Member is of equal bargaining strength; (ii) each Member has actively
participated in the drafting, preparation and negotiation of this Agreement; and
(iii) any rule of construction to the effect that ambiguities are to be resolved
against the drafting party shall not apply in the interpretation of this
Agreement, any portion hereof, or any Exhibits attached hereto.
13.06    Counterparts
This Agreement may be executed and delivered in multiple counterparts including
by facsimile or .pdf file, each of which shall be deemed an original Agreement,
but all of which, taken together, shall constitute one (1) and the same
Agreement, binding on the parties hereto. The signature of any party hereto to
any counterpart hereof shall be deemed a signature to, and may be appended to,
any other counterpart hereof.

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13.07    Attorneys' Fees
If any lawsuit, arbitration, mediation or other proceeding is commenced by any
Member against any other Member that arises out of, or relates to, this
Agreement, then the prevailing Member in such action shall be entitled to
recover reasonable attorneys' fees and costs. Any judgment or order entered in
any such action shall contain a specific provision providing for the recovery of
all costs and expenses of suit including, without limitation, reasonable
attorneys' and expert witness fees, costs and expenses incurred in connection
with (i) enforcing, perfecting and executing such judgment; (ii) post-judgment
motions; (iii) contempt proceedings; (iv) garnishment, levy, and debtor and
third-party examinations; (v) discovery; and (vi) bankruptcy litigation.
13.08    Approval Standard
The consent, approval or determination of any Member required or permitted under
this Agreement may be withheld in such party's sole and absolute discretion,
unless this Agreement provides that such consent or approval shall not be
unreasonably withheld (or another standard is specifically provided for in this
Agreement for such matter).
13.09    Further Acts
Each Member covenants, on behalf of such Member and such Member's successors and
assigns, to execute, with acknowledgment, verification, or affidavit, if
required, any and all documents and writings, and to perform any and all other
acts, that may be reasonably necessary or desirable to implement, accomplish,
and/or consummate the formation of the Company, the achievement of the Company's
purposes, and any other matter contemplated under this Agreement.
13.10    Preservation of Intent
If any provision of this Agreement is determined by any court having
jurisdiction to be illegal or in conflict with any laws of any state or
jurisdiction, then the Members agree that such provision shall be modified to
the extent legally possible so that the intent of this Agreement may be legally
carried out. If any one (1) or more of the provisions contained herein, or the
application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect or for any reason, then the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired or affected, it being
intended that the Members' rights and privileges described in this Agreement
shall be enforceable to the fullest extent permitted by law.
13.11    Waiver
No consent or waiver, express or implied, by a party to or of any breach or
default by any other party in the performance by such other party of such other
party's obligations hereunder shall be deemed or construed to be a consent or
waiver to or of any other breach or default in the performance by such other
party hereunder. Failure on the part of a party to complain of any act or
failure to act of any other party or to declare any other party in default,
irrespective of how long such failure continues, shall not constitute a waiver
by such non-complaining or non-declaring party of the latter's rights hereunder.

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13.12    Entire Agreement
This Agreement contains the entire understanding among the parties hereto with
respect to the subject matter hereof and supersedes any and all prior or other
contemporaneous understanding, correspondence, negotiations or agreements
between them respecting the subject matter hereof.
13.13    Choice of Law
Notwithstanding the place where this Agreement may be executed by any of the
parties hereto, the parties expressly acknowledge and agree that all of the
terms and provisions of this Agreement shall be construed under the laws of the
State of Delaware (without giving effect to the conflicts of laws and principles
thereof). In furtherance of the foregoing, and pursuant to Section 17708.01(a)
of the California Act, all rights, duties, obligations and remedies of the
Members shall be governed by the Delaware Act (without giving effect to the
conflicts of laws and principals thereof).
13.14    No Third-Party Beneficiaries
Except as otherwise set forth in Section 3.05 and Article X, the provisions of
this Agreement are not intended to be for the benefit of, or enforceable by, any
third party and shall not give rise to a right on the part of any third party
(i) to enforce or demand enforcement of a Member's obligation to contribute
capital, obligation to return distributions, or obligation to make other
payments to the Company as set forth in this Agreement, or (ii) to demand that
the Company, the Administrative Member or the other Member obtain financing or
issue any capital call.
13.15    Successors and Assigns
Subject to the restrictions set forth in Article VI and Section 9.04, this
Agreement shall inure to the benefit of and shall bind the parties hereto and
their respective personal representatives, successors, and assigns.
13.16    No Usury
Notwithstanding any other provision in this Agreement, the rate of interest
charged by the Company or by any Member (and/or any Affiliate thereof) in
connection with any obligation under this Agreement shall not exceed the maximum
rate permitted by applicable law. To the extent that any interest charged by the
Company or by any Member (and/or Affiliate thereof) shall have been finally
adjudicated to exceed the maximum amount permitted by applicable law, such
interest shall be retroactively deemed to have been a required repayment of
principal (and any such amount paid in excess of the outstanding principal
amount shall be promptly returned to the payor). In furtherance of the
foregoing, the Members acknowledge and agree that pursuant to the Delaware Act,
no obligation of a Member to the Company shall be subject to the defense of
usury, and no Member shall impose the defense of usury with respect to any such
obligation in any action.

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13.17    Venue
If any litigation, claim or lawsuit directly or indirectly arising out of this
Agreement is not required to be resolved in accordance with the JAMS procedures
provided for under Section 13.18, then each Member hereby irrevocably consents
to the maximum extent allowed by law to the exclusive jurisdiction of the state
and federal courts located in California and to the exclusive venue of (i) the
Eastern District of California for any federal action or proceeding arising out
of, or relating to, this Agreement, and (ii) the Superior Court of California
located in Kern County, California for any state action or proceeding arising
out of, or relating to, this Agreement.
13.18    Dispute Resolution
Any action to resolve any controversy or claim arising out of, or related to in
any way to, this Agreement (exclusive of any impasse on any Major Decision),
including, without limitation, any alleged breach of this Agreement and any
claim based upon any tort theory, however characterized shall be resolved
through a binding arbitration before an arbitrator in accordance with the terms
of this Section 13.18.
(a)    Binding Arbitration. Any Member desiring to bring any action under this
Agreement shall give written notice to the other Member (the "Arbitration
Notice"), which notice shall state with particularity the nature of the dispute
and the demand for relief, making specific reference by Section and title, if
applicable, of the provisions of this Agreement pertaining to the dispute. This
arbitration provision and its validity, construction, and performance shall be
governed by the Federal Arbitration Act (the "FAA") and cases decided thereunder
and, to the extent relevant, the laws of the State of California. Further, the
terms and procedures governing the enforcement of this Section 13.18 shall be
governed by and construed and enforced in accordance with the FAA, and not
individual state laws regarding enforcement of arbitration agreements.
(b)    Selection of Arbitrator. The Members shall endeavor to agree, within
thirty (30) days of the Arbitration Notice, upon a mutually acceptable
arbitrator to resolve the dispute. The arbitrator shall be a single former judge
of the Superior Court or the Court of Appeal of the State of California or a
member in good standing with the California State Bar currently employed by or
associated with the office of JAMS/ENDISPUTE ("JAMS") located in Los Angeles,
California. The arbitrator shall have no direct or indirect social, political or
business relationship of any sort with either of the Members, their respective
legal counsel, or any other Person materially involved with the Project. If the
Members cannot agree upon the arbitrator within such thirty (30)-day period,
then JAMS, in its sole discretion, shall provide a list of three (3) arbitrators
with the qualifications set forth above. Within ten (10) days of JAMS providing
the above-described list, each Member shall be entitled to strike one (1) name
from the list and so notify JAMS. JAMS, in its sole discretion, thereafter shall
select as arbitrator any one (1) of the persons remaining on the list, and the
person so selected shall thereafter serve as arbitrator. If for any reason JAMS
is unable or unwilling to make such an appointment, then any Member may apply to
the Superior Court of the State of California in and for the County of Los
Angeles for appointment of any former judge of the Superior Court or the Court
of Appeal of the State of California to serve as arbitrator. The appointment of
an arbitrator, whether by JAMS or by the Superior Court pursuant to the

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foregoing, shall be made, and the arbitrator shall serve, without further
objection from any Member, except on the ground of conflict of interest, if any,
pursuant to the same rules that would apply if the arbitrator was serving as an
active member of the Superior Court or Court of Appeal.
(c)    Location of Proceeding. The proceeding shall take place at a City of Los
Angeles office of JAMS and shall be conducted pursuant to the provisions of JAMS
Comprehensive Arbitration Rules & Procedures in effect on the date of the
Arbitration Notice (the "Rules"); provided that in all events the rules of
evidence in such proceeding shall be governed by the California Evidence Code.
Discovery between the parties prior to the arbitration hearing shall be limited
to the mutual exchange of relevant documents. Interrogatories and request for
admissions shall not be allowed under any circumstance. Depositions of witnesses
shall not be permitted, unless it is shown that the witness will be otherwise
unavailable and it is necessary to preserve his or her testimony for the
hearing. The arbitrator shall have the authority set forth in Section 1282.6 of
the California Code of Civil Procedure to issue subpoenas requiring the
attendance at the hearing of witnesses, and to issue subpoenas duces tecum for
the production at the hearing of books, records, documents and other evidence.
(d)    Resolution Dispute. In resolving the dispute, the arbitrator shall apply
Delaware law to the matter being considered under this Agreement. In resolving
the dispute, the arbitrator shall apply the pertinent provisions of this
Agreement without departure therefrom in any respect, and the arbitrator shall
not have the power to change any of the provisions of the Agreement. The
arbitrator shall try all of the issues including, without limitation, any issues
that may be raised concerning whether the dispute is subject to the provisions
of this Section 13.18 and any and all other issues, whether of fact or of law,
and shall hear and decide all motions and matters of any kind. The arbitrator
shall not be required to prepare a written statement of decision as to any
interlocutory decision, but at the conclusion of the arbitration shall prepare a
written statement of decision thereon which shall be final and binding upon the
parties, and upon which judgment may be entered in accordance with applicable
law in any court having jurisdiction thereof. Any interlocutory decisions by the
arbitrator likewise shall be final and binding, except that the arbitrator shall
have the power to reconsider such decisions for good cause shown. The Members
shall not have the right to appeal the arbitration award consistent with the
JAMS Optional Arbitration Appeal Procedure in effect at the time or any similar
successor rules. The arbitration award shall be final and binding on the parties
and judgment on the award may be entered in any court having jurisdiction.
Subject to the limitations in this Section 13.18, the arbitrator shall have the
authority to grant any equitable and legal remedies that would be available in a
judicial proceeding. The arbitrator may award interim and final injunctive
relief and other remedies, but may not award punitive, exemplary, treble, or
other enhanced damages. The arbitrator shall have no power or authority to issue
any award or determination that would amend or modify this Agreement.
Notwithstanding the foregoing, a party shall be permitted to seek a temporary
restraining order, or injunctive relief in a court of competent jurisdiction
with regard to any controversy, dispute, or claim between them relating to or
arising out of this Agreement, a breach of this Agreement, or the termination of
the Administrative Member, where such relief is appropriate; provided that other
relief shall be pursued through an arbitration proceeding pursuant to this
Section 13.18. Each Member shall use reasonable efforts to expedite the
arbitration process, and each Member shall have the right to be represented by
counsel.

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(e)    Award of Fees. Subject to the obligation of the arbitrator to award such
fees and expenses to the prevailing party as provided above, until the
arbitrator issues his or her final statement of decision, each Member shall pay
the fees and expenses of its attorneys and experts in connection with the
adjudication and one-half of the fees and expenses of the arbitrator; provided,
however, that the arbitrator shall have the same power as a judge pursuant to
the California Code of Civil Procedure to award sanctions with reference to
interlocutory matters. Each Member shall bear an equal (pro rata) share of any
arbitration costs, including any administrative or hearing fees charged by the
arbitrator or JAMS.
(f)    Waiver of Jury Trial. TO THE MAXIMUM EXTENT PERMITTED BY LAW, EACH MEMBER
HEREBY WAIVES EACH SUCH MEMBER'S RIGHT TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE
OF ACTION (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) BASED UPON OR ARISING
OUT OF OR RELATED TO THE COMPANY, THIS AGREEMENT, OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION, PROCEEDING, OR OTHER LITIGATION
OF ANY TYPE BROUGHT BY ANY MEMBER AGAINST THE OTHER MEMBER, WHETHER WITH RESPECT
TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. EACH MEMBER AGREES THAT ANY SUCH
CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY AN ARBITRATOR AS PROVIDED ABOVE BUT
THIS WAIVER SHALL BE EFFECTIVE EVEN IF, FOR ANY REASON WHATSOEVER, SUCH CLAIM OR
CAUSE OF ACTION CANNOT BE TRIED BY SUCH ARBITRATOR. WITHOUT LIMITING THE
FOREGOING, EACH MEMBER FURTHER AGREES THAT EACH SUCH MEMBER'S RIGHT TO A TRIAL
BY JURY IS WAIVED TO THE MAXIMUM EXTENT ALLOWED BY LAW BY OPERATION OF THE
FOREGOING AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN
WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT
OR ANY PROVISION HEREOF. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS, OR MODIFICATIONS TO THIS AGREEMENT.
/s/ HM, /s/ GB  
INITIALS OF TEJON
/s/ BT, /s/ TS, /s/ ER  
INITIALS OF MAJESTIC 

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(g)    Survivability. The provisions of this Section 13.18 shall survive the
withdrawal of any Member from the Company and the dissolution and liquidation of
the Company.
13.19    Timing
All dates and times specified in this Agreement are of the essence and shall be
strictly enforced.
13.20    Remedies for Breach of this Agreement
Except as otherwise specifically provided in this Agreement, the remedies set
forth in this Agreement are cumulative and shall not exclude any other remedies
to which a Person may be lawfully entitled.
13.21    Survivability of Representations and Warranties
All representations, warranties and covenants contained in this Agreement
including, without limitation, the indemnities contained in Sections 7.10, 8.09,
9.01, 9.02, 9.03, 9.05 and 10.02(b) shall survive the execution of this
Agreement, the formation of the Company, the withdrawal of any Member and the
liquidation of the Company.
13.22    Reasonableness of Rights and Remedies
THE RIGHTS AND REMEDIES SET FORTH IN THIS AGREEMENT (INCLUDING, WITHOUT
LIMITATION, SECTION 3.03 AND ARTICLES VII AND VIII) ARE A MATERIAL INDUCEMENT
FOR EACH MEMBER TO ENTER INTO THIS AGREEMENT, AND THE MEMBERS WOULD NOT HAVE
AGREED TO ENTER INTO THIS AGREEMENT BUT FOR THE AGREEMENT OF EACH MEMBER TO BE
BOUND BY SUCH REMEDIES. EACH MEMBER ACKNOWLEDGES AND AGREES THAT THE FOREGOING
REMEDIES ARE FAIR AND REASONABLE AND HAVE BEEN ENTERED INTO WITH THE INFORMED
CONSENT OF EACH MEMBER. EACH MEMBER FURTHER ACKNOWLEDGES AND AGREES THAT IT
WOULD BE IMPRACTICABLE AND EXTREMELY DIFFICULT TO ESTIMATE THE DAMAGES WHICH THE
COMPANY AND THE NON‑DEFAULTING MEMBER MAY SUFFER IN CONNECTION WITH THE
OCCURRENCE OF ANY OF THE DEFAULTS DESCRIBED ABOVE. THEREFORE, EACH MEMBER AGREES
THAT THE REMEDIES SET FORTH ABOVE REASONABLY AND FAIRLY REFLECT THE DETRIMENT
THAT THE COMPANY AND THE NON‑DEFAULTING MEMBER WOULD SUFFER IN SUCH EVENT AND,
IN LIGHT OF THE DIFFICULTY IN DETERMINING ACTUAL DAMAGES, REPRESENT A PRIOR
AGREEMENT AMONG THE MEMBERS AS TO APPROPRIATE LIQUIDATED DAMAGES. EACH MEMBER
ALSO AGREES THAT THE REMEDIES SET FORTH ABOVE ARE NOT INTENDED AS A FORFEITURE
OR PENALTY UNDER DELAWARE OR ANY OTHER APPLICABLE STATE LAW. EACH MEMBER FURTHER
COVENANTS NOT TO CONTEST THE VALIDITY OF THE REMEDIES SET FORTH ABOVE AS A
PENALTY, FORFEITURE OR OTHERWISE IN ANY COURT OF LAW (AND/OR IN ANY ARBITRATION
OR MEDIATION).

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13.23    Force Majeure
The term period for each Member to perform any obligation under this Agreement
shall be extended for the time period such Member (the "Obligated Member") is
unable to perform such obligation as a result of any Force Majeure Delay. The
term "Force Majeure Delay" means any delay as a result of war, national
emergency, strikes (other than strikes or labor disturbances limited in scope to
primarily the employees of the Obligated Member or any Affiliate thereof), riot
or civil unrest, utility failure, acts of God (excluding inclement weather) or
other events totally outside the control of the Obligated Member or any
Affiliate thereof. Notwithstanding the foregoing, no Force Majeure Delay shall
be deemed to exist as a result of (i) the Obligated Member's lack of funds
(other than a temporary lack of funds resulting from any event totally outside
the control of the Obligated Member described in the preceding sentence), or
(ii) any delay solely caused by any act or omission of the Obligated Member or
any Affiliate thereof, and in any event, the length of any Force Majeure Delay
shall be reduced by (A) the time period that elapses after the tenth Business
Day following the initial cause of the delay through the date the Obligated
Member notifies the other Member in writing of the delay and the reason for the
delay (if the Obligated Member has previously failed to provide such notice to
the other Member on or before the tenth Business Day following the initial cause
of the delay), or (B) the length of any delay caused by the Obligated Member's
failure to promptly exercise and continue to exercise reasonable commercial
efforts to remove or overcome such delay. All other delays from acts or events
are explicitly excluded from Force Majeure Delays and shall not extend the time
period for any Member to perform any of its obligations under this Agreement.
ARTICLE XIV
    
DEFINITIONS
14.01    Accountant's Notice
The term "Accountant's Notice" is defined in Section 7.03.
14.02    Accounting Firm
The term "Accounting Firm" means Ernst & Young or such other accounting firm as
selected by the Executive Committee.
14.03    Acquisition Loan
The term "Acquisition Loan" is defined in Section 3.04.
14.04    Actual Knowledge of Majestic
The term "Actual Knowledge of Majestic" is defined in Section 9.02.
14.05    Actual Knowledge of Tejon
The term "Actual Knowledge of Tejon" is defined in Section 9.01.

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14.06    Adjusted Accountant's Notice
The term "Adjusted Accountant's Notice" is defined in Section 7.05.
14.07    Adjusted Capital Account
The term "Adjusted Capital Account" means, with respect to each Member as of the
end of each Fiscal Year of the Company, such Member's Capital Account
(i) reduced by any anticipated allocations, adjustments and distributions
described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4)-(6), and
(ii) increased by the amount of any deficit in such Member's Capital Account
that such Member is deemed obligated to restore pursuant to the penultimate
sentences of Treasury Regulation Sections 1.704-2(g)(1) and 1.704-2(i)(5) or
under Section 1.704-1(b)(2)(ii)(c) of the Treasury Regulations at the end of
such Fiscal Year.
14.08    Adjusted Price Determination Notice
The term "Adjusted Price Determination Notice" is defined in Section 8.05.
14.09    Administrative Member
The term "Administrative Member" is defined in Section 2.03.
14.10    Affiliate
The term "Affiliate" means any Person which, directly or indirectly through one
(1) or more intermediaries, controls or is controlled by or is under common
control with another Person. The term "control" as used herein (including the
terms "controlling," "controlled by," and "under common control with") means the
possession, direct or indirect, of the power to (i) vote more than fifty percent
(50%) of the outstanding voting securities of such Person, or (ii) otherwise
direct management policies of such Person by contract or otherwise.
14.11    Affiliate Agreements
The term "Affiliate Agreements" is defined in Section 2.10.
14.12    Affiliated Parties
The term "Affiliated Parties" is defined in Section 9.05.
14.13    Agreement
The term "Agreement" means this Limited Liability Company Agreement of
TRC‑MRC 2, LLC.
14.14    Appraised Value
The term "Appraised Value" is defined in Section 7.03(a).
14.15    Approved Business Plan

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The term "Approved Business Plan" is defined in Section 2.06.
14.16    Arbitration Notice
The term "Arbitration Notice" is defined in Section 13.18(a).
14.17    Book Basis
The term "Book Basis" means, with respect to any asset of the Company, the Gross
Asset Value (as determined under this Agreement). The Book Basis of all assets
of the Company shall be adjusted thereafter by depreciation as provided in
Treasury Regulation Section 1.704-1(b)(2)(iv)(g) and any other adjustment to the
basis of such assets other than depreciation or amortization.
14.18    Brown
The term "Brown" is defined in Section 9.01(k).
14.19    Business Day
The term "Business Day" means any day other than Saturday, Sunday, or other day
on which commercial banks in California are authorized or required to close
under the laws of such state or the United States.
14.20    California Act
The term "California Act" means the California Revised Uniform Limited Liability
Company Act as set forth in Title 2.6, Chapter 1 et seq. of the California
Corporations Code, as hereafter amended from time to time.
14.21    Capital Account
The term "Capital Account" means with respect to each Member, the amount of
money contributed by such Member to the capital of the Company, increased by the
aggregate fair market value at the time of contribution (as determined by the
Executive Committee) of all property contributed by such Member to the capital
of the Company (net of liabilities secured by such contributed property that the
Company is considered to assume or take subject to under Section 752 of the
Code), the aggregate amount of all Net Profits allocated to such Member, and any
and all items of gross income and gain specially allocated to such Member
pursuant to Sections 4.03 and 4.04, and decreased by the amount of money
distributed to such Member by the Company (exclusive of any guaranteed payment
within the meaning of Section 707(c) of the Code paid to such Member), the
aggregate fair market value at the time of distribution (as determined by the
Executive Committee) of all property distributed to such Member by the Company
(net of liabilities secured by such distributed property that such Member is
considered to assume or take subject to under Section 752 of the Code), the
amount of any Net Losses allocated to such Member, and any and all losses and
deductions, including, without limitation, any and all partnership and/or
partner "nonrecourse deductions" specially allocated to such Member pursuant to
Sections 4.03 and 4.04. The foregoing Capital Account definition and the other
provisions of this Agreement relating to the maintenance of Capital Accounts are
intended to comply with Treasury Regulation

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Sections 1.704-1(b) and 1.704-2 and shall be interpreted and applied in a manner
consistent with such Regulations.
14.22    Capital Call Notice
The term "Capital Call Notice" is defined in Section 3.02.
14.23    Cash Flow
The term "Cash Flow" means the excess, if any, of all cash receipts of the
Company as of any applicable determination date in excess of the sum of (i) all
cash disbursements (inclusive of any guaranteed payment within the meaning of
Section 707(c) of the Code paid to any Member and any reimbursements made to any
Member, but exclusive of distributions to the Members in their capacities as
such) of the Company prior to that date, and (ii) any reserve, reasonably
determined by Administrative Member, for anticipated cash disbursements,
including debt service, that will have to be made before additional cash
receipts from third parties will provide the funds therefor.
14.24    Certificates
The term "Certificates" is defined in Section 3.03(a).
14.25    Code
The term "Code" means the Internal Revenue Code of 1986, as heretofore and
hereafter amended from time to time (and/or any corresponding provision of any
superseding revenue law).
14.26    Company
The term "Company" means the limited liability company created pursuant to this
Agreement and the filing of the Certificate of Formation for the Company with
the Office of the Delaware Secretary of State in accordance with the provisions
of the Delaware Act.
14.27    Contributing Member
The term "Contributing Member" is defined in Section 3.03.
14.28    Contributing Party
The term "Contributing Party" is defined in Section 3.05.
14.29    Contribution Date
The term "Contribution Date" is defined in Section 3.02.

14.30    Covered Persons

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The term "Covered Persons" is defined in Section 10.02(a).
14.31    Default Events
The term "Default Events" is defined in Section 7.01.
14.32    Default Loan
The term "Default Loan" is defined in Section 3.03(a).
14.33    Default Notice
The term "Default Notice" is defined in Section 7.02.
14.34    Defaulting Member
The term "Defaulting Member" is defined in Section 7.01.
14.35    Defaulting Member's Purchase Price
The term "Defaulting Member's Purchase Price" is defined in Section 7.03.
14.36    Delaware Act
The term "Delaware Act" means the Delaware Limited Liability Company Act (6 Del.
C. § 18-101, et seq.), as hereafter amended from time to time.
14.37    Delinquent Contribution
The term "Delinquent Contribution" is defined in Section 3.03.
14.38    Deposit
The term "Deposit" is defined in Section 8.04.
14.39    Dilution Percentage
The term "Dilution Percentage" is defined in Section 3.03(b).
14.40    Effective Date
The term "Effective Date" is defined in the Preamble.
14.41    Electing Member
The term "Electing Member" is defined in Section 8.01.
14.42    Election Notice

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The term "Election Notice" is defined in Section 8.01.
14.43    Enforceability Exceptions
The term "Enforceability Exceptions" is defined in Section 9.01(c).
14.44    Executive Committee
The term "Executive Committee" is defined in Section 2.01(a).
14.45    FAA
The term "FAA" is defined in Section 13.18(a).
14.46    Fiscal Year
The term "Fiscal Year" means the twelve (12)-month period ending December 31 of
each year; provided that the initial Fiscal Year shall be the period beginning
on the Effective Date and ending on December 31, 2016, and the last Fiscal Year
shall be the period beginning on January 1 of the calendar year in which the
final liquidation and termination of the Company is completed and ending on the
date such final liquidation and termination is completed. To the extent any
computation or other provision hereof provides for an action to be taken on a
Fiscal Year basis, an appropriate proration or other adjustment shall be made in
respect of the initial and final Fiscal Years to reflect that such periods are
less than full calendar year periods.
14.47    Force Majeure Delay
The term "Force Majeure Delay" is defined in Section 13.23.
14.48    Gross Asset Value
The term "Gross Asset Value" means, in respect to any asset of the Company, the
asset's adjusted tax basis for federal income tax purposes; provided, however,
that (i) the Gross Asset Value of any asset contributed or deemed contributed by
a Member to the Company or distributed to a Member by the Company shall be the
gross fair market value of such asset (without taking into account
Section 7701(g) of the Code), as determined by the Executive Committee; (ii) the
Gross Asset Values of all Company assets may be adjusted to equal their
respective gross fair market values (without taking into account Section 7701(g)
of the Code), as determined by the Executive Committee, upon the termination of
the Company for federal income tax purposes pursuant to Section 708(b)(1)(B) of
the Code; and (iii) the Gross Asset Values of all Company assets may be
adjusted, by the Executive Committee, to equal their respective gross fair
market values (taking into account Section 7701(g) of the Code), as reasonably
determined by the Executive Committee, as of (A) the date of the acquisition of
an additional interest in the Company by any new or existing member in exchange
for more than a de minimis contribution to the capital of the Company, or
(B) upon the Liquidation of the Company or the distribution by the Company to a
retiring or continuing member of more than a de minimis amount of money or other
Company property in reduction of such Member's Interest. Any adjustments made to
the Gross Asset Value of

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Company assets pursuant to the foregoing provisions shall be reflected in the
Members' Capital Account balances in the manner set forth in Treasury Regulation
Sections 1.704‑1(b) and 1.704‑2.
14.49    Guarantor(s)
The terms "Guarantor" and "Guarantors" are defined in Section 3.05.
14.50    Hypothetical Distribution
The term "Hypothetical Distribution" means, with respect to each Member and any
Fiscal Year, the amount that would be received by such Member (or, in certain
cases, reduced as appropriate by the amount such Member would be obligated to
pay) if all Company assets were sold for cash equal to their Book Basis, all
Company liabilities were satisfied to the extent required by their terms
(limited, with respect to each nonrecourse liability to the Book Basis of the
assets securing each such liability), and the net assets of the Company were
distributed in full to the Members pursuant to Section 5.01.
14.51    Impasse Event
The term "Impasse Event" is defined in Section 2.02(k).
14.52    Improvements
The term "Improvements" is defined in Section 1.03.
14.53    Initial Contribution
The term "Initial Contribution" is defined in Section 3.01.
14.54    Interest
The term "Interest" means with respect to each Member, all of such Member's
right, title and interest in and to the Net Profits, Net Losses, Cash Flow,
distributions and capital of the Company, and any and all other interests
therein in accordance with the provisions of this Agreement and the Delaware
Act.
14.55    JAMS
The term "JAMS" is defined in Section 13.18(b).
14.56    Just Cause Event
The term "Just Cause Event" is defined in Section 2.11(c).
14.57    Lender(s)
The terms "Lender" and "Lenders" are defined in Section 3.04.
14.58    Liquidation

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The term "Liquidation" means, (i) with respect to the Company the earlier of the
date upon which the Company is terminated under Section 708(b)(1) of the Code or
the date upon which the Company ceases to be a going concern (even though it may
continue in existence for the purpose of winding up its affairs, paying its
debts and distributing any remaining balance to its Members), and (ii) with
respect to a Member wherein the Company is not in Liquidation, means the
liquidation of a Member's interest in the Company under Treasury Regulation
Section 1.761-1(d).
14.59    Loan Documents
The term "Loan Documents" is defined in Section 3.05.
14.60    Loans
The term "Loans" is defined in Section 3.04.
14.61    Lockout Date
The term "Lockout Date" is defined in Section 8.01.
14.62    Losses
The term "Losses" is defined in Section 3.05.
14.63    Lyda
The term "Lyda" is defined in Section 2.01(b).
14.64    Majestic
The term "Majestic" is defined in the Preamble.
14.65    Majestic Group
The term "Majestic Group" is defined in the Section 6.02(e).
14.66    Major Decisions
The term "Major Decisions" is defined in Section 2.04.
14.67    Management Fee
The term "Management Fee" is defined in Section 2.13.
14.68    Marketing Plan
The term "Marketing Plan" is defined in Section 2.08.
14.69    McMahon

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The term "McMahon" is defined in Section 2.01(b).
14.70    Member(s)
The term "Members" means Tejon and Majestic, collectively; the term "Member"
means either one (1) of the Members.
14.71    MRC
The term "MRC" is defined in Section 6.02(c).
14.72    Net Profits and Net Losses
The terms "Net Profits" and "Net Losses" mean, for each Fiscal Year or other
period, an amount equal to the Company's taxable income or loss, as the case may
be, for such year or period, determined in accordance with Section 703(a) of the
Code (for this purpose, all items of income, gain, loss and deduction required
to be stated separately pursuant to Section 703(a)(1) of the Code shall be
included in taxable income or loss); provided, however, for purposes of
computing such taxable income or loss, (i) such taxable income or loss shall be
adjusted by any and all adjustments required to be made in order to maintain
Capital Account balances in compliance with Treasury Regulation
Sections 1.704-1(b), and (ii) any and all items of gross income, gain, loss
and/or deductions, including, without limitation, any and all partnership and/or
partner "nonrecourse deductions" specially allocated to any Member pursuant to
Sections 4.03 and 4.04 shall not be taken into account in calculating such
taxable income or loss.
14.73    Non-Contributing Member
The term "Non-Contributing Member" is defined in Section 3.03.
14.74    Non-Contributing Party
The term "Non-Contributing Party" is defined in Section 3.05.
14.75    Non-Defaulting Member
The term "Non-Defaulting Member" is defined in Section 7.01.
14.76    Non-Electing Member
The term "Non-Electing Member" is defined in Section 8.01.
14.77    Nonrecourse Parties
The term "Nonrecourse Parties" is defined in Section 10.03.

14.78    Obligated Member

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The term "Obligated Member" is defined in Section 13.23.
14.79    OFAC
The term "OFAC" is defined in Section 9.01(h).
14.80    Officers
The term "Officers" is defined in Section 2.12.
14.81    Operating Budget
The term "Operating Budget" is defined in Section 2.07.
14.82    Partially Adjusted Capital Account
The term "Partially Adjusted Capital Account" means, with respect to each Member
and taxable year, the Capital Account of such Member at the beginning of such
taxable year, adjusted as set forth in the definition of "Capital Account" for
all contributions and distributions during such year and all special allocations
pursuant to Sections 4.03 and 4.04, but before giving effect to any allocation
to Net Profits or Net Losses for such taxable year pursuant to Section 4.01 or
4.02.
14.83    Percentage Interest
The term "Percentage Interest" means, with respect to each Member, the
percentage set forth opposite such Member's name on Exhibit "A" attached hereto
under the column labeled "Percentage Interest," subject to any adjustment
pursuant to Section 3.03(b).
14.84    Permanent Loan
The term "Permanent Loan" is defined in Section 3.04.
14.85    Permitted Transferees
The term "Permitted Transferees" is defined in Section 6.02.
14.86    Person
The term "Person" means a natural person, partnership (whether general or
limited), limited liability company, trust, estate, association, corporation,
custodian, nominee, or any other individual or entity, in its own or any
representative capacity.
14.87    Price Determination Notice
The term "Price Determination Notice" is defined in Section 8.02.
14.88    Pro Rata Share

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The term "Pro Rata Share" is defined in Section 3.05.
14.89    Project
The term "Project" is defined in Section 1.03.
14.90    Property
The term "Property" is defined in Section 1.03.
14.91    Property Manager Member
The term "Property Manager Member" is defined in Section 2.09.
14.92    Purchase Notice
The term "Purchase Notice" is defined in Section 8.03.
14.93    Purchase Price
The term "Purchase Price" is defined in Section 8.02.
14.94    Quorum
The term "Quorum" is defined in Section 2.02(a).
14.95    Real Estate Assets
The term "Real Estate Assets" is defined in the Section 6.02(d).
14.96    Regulatory Allocations
The term "Regulatory Allocations" is defined in Section 4.04.
14.97    Removal Notice
The term "Removal Notice" is defined in Section 2.11(c).
14.98    Representative(s)
The terms "Representative" and "Representatives" are defined in Section 2.01(b).
14.99    Response Period
The term "Response Period" is defined in Section 2.05.
14.100    Roski
The term "Roski" is defined in Section 6.02(c).

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14.101    Roski Family
The term "Roski Family" is defined in Section 6.02(c).
14.102    Rules
The term "Rules" is defined in Section 13.18(c).
14.103    Securities Acts
The term "Securities Acts" is defined in Section 9.04(a)(i).
14.104    Shortfall
The term "Shortfall" is defined in Section 3.02.
14.105    Stated Value
The term "Stated Value" is defined in Section 8.01.
14.106    Target Capital Account
The term "Target Capital Account" means, with respect to each Member and any
taxable year, an amount (which may be either a positive or a deficit balance)
equal to the Hypothetical Distribution such Member would receive (or, in certain
cases, reduced as appropriate by the amount such Member would be required to
pay), minus the Member's share of Company minimum gain determined pursuant to
Treasury Regulation Section 1.704‑2(g), and minus the Member's share of partner
minimum gain determined in accordance with Treasury Regulation
Section 1.704‑2(i)(5), all computed immediately prior to the hypothetical sale
described in the definition of "Hypothetical Distribution."
14.107    Tejon
The term "Tejon" is defined in the Preamble.
14.108    Tejon Group
The term "Tejon Group" is defined in the Section 6.02(d).
14.109    Transfer
The term "Transfer" is defined in Section 6.01.

14.110    Treasury Regulation

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The term "Treasury Regulation" means any proposed, temporary and/or final
federal income tax regulation promulgated by the United States Department of the
Treasury as heretofore and hereafter amended from time to time (and/or any
corresponding provisions of any superseding revenue law and/or regulation).
14.111    Unreturned Contribution Account
The term "Unreturned Contribution Account" means a separate account to be
maintained by the Company for each Member that will be credited by the agreed
value of any property contributed by such Member and the amount of money
contributed (or deemed contributed) by such Member to the capital of the Company
and credited to such account pursuant to Sections 3.01, 3.02, 3.03(a) or
3.03(b), and decreased by the amount of money distributed (or deemed
distributed) by the Company to such Member pursuant to Sections 3.03(a), 3.03(b)
or 5.01(a), and the fair market value at the time of distribution (as determined
by the Executive Committee) of any property distributed to such Member by the
Company (net of any liabilities secured by such distributed property that such
Member is considered to assume or take subject to under Section 752 of the Code)
pursuant to Section 5.01(a).
[SIGNATURES ON NEXT PAGE]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as
of the day and year first above written.
"Tejon"
TEJON ENERGY LLC,
a California limited liability company

By:
/s/ Gregory S. Bielli    

Name: Gregory S. Bielli    
Its: President/Chief Executive Officer    

By:
/s/ Hugh F. McMahon IV    

Name: Hugh F. McMahon IV    
Its: Executive Vice President - Commercial and Industrial Real Estate    

"Majestic"
MAJESTIC TEJON II, LLC,
a Delaware limited liability company

By:
Majestic Realty Company,
a California corporation
Its Manager

By:
/s/ EDWARD P. ROSKI, JR.    

Name: EDWARD P. ROSKI, JR.    
Its: President and Chairman of the Board    

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EXHIBIT "A"
NAMES, ADDRESSES, PERCENTAGE INTERESTS AND
INITIAL CASH CONTRIBUTIONS OF THE MEMBERS
Member
Percentage
Interest
Initial Cash
Contribution
Tejon Energy LLC 
P.O. Box 1000
Lebec, CA 93243
Attn.: Allen Lyda and Hugh McMahon
50.0%
$125,000
Majestic Tejon II, LLC   
13191 Crossroads Parkway North, 6th Floor
City of Industry, CA 91746-3497   
Attn.: Edward P. Roski, Jr. and
Brett A. Tremaine
50.0%
$125,000
Totals
______
100.0%
 

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EXHIBIT "B"
LEGAL DESCRIPTION OF THE PROPERTY
THE LAND REFERRED TO IN THIS COMMITMENT IS SITUATED IN THE UNINCORPORATED AREA
OF THE COUNTY OF KERN, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:
PARCEL A:
LOT 1 OF LOT LINE ADJUSTMENT NO. 29-01, AS EVIDENCED BY THAT CERTAIN CERTIFICATE
OF COMPLIANCE RECORDED MARCH 26, 2001, AS INSTRUMENT NO. 01-38309, KERN COUNTY
RECORDS, MORE PARTICULARLY DESCRIBED AS FOLLOWS:
A PORTION OF PARCEL B AND THE DESIGNATED REMAINDER OF PARCEL MAP NO. 10663,
PHASE A, FILED IN PARCEL MAP BOOK 51 AT PAGES 60 AND 61, IN THE OFFICE OF THE
KERN COUNTY RECORDER ALSO BEING ALL THAT PORTION OF FRACTIONAL SECTION 6,
TOWNSHIP 10 NORTH, RANGE 19 WEST, S.B.M., COUNTY OF KERN, STATE OF CALIFORNIA,
DESCRIBED AS FOLLOWS:
COMMENCING AT THE CENTERLINE INTERSECTION OF TEJON INDUSTRIAL DRIVE AND
INDUSTRIAL PARKWAY DRIVE AS SHOWN ON SAID PARCEL MAP NO. 10663-A, SAID POINT
ALSO BEING ON THE NORTHERLY LINE OF PARCEL 1 OF SAID PARCEL MAP, THENCE SOUTH
89°41’30" EAST, ALONG THE NORTHERLY LINE OF SAID PARCEL, 137.55 FEET TO THE
BEGINNING OF A CURVE, CONCAVE SOUTHERLY, HAVING A RADIUS OF 300.00 FEET, THENCE
EASTERLY, ALONG SAID CURVE AND CONTINUING ALONG SAID NORTHERLY LINE, THROUGH A
CENTRAL ANGLE OF 17°04'54", AN ARC LENGTH OF 89.44 FEET, THENCE SOUTH 72°36'36"
EAST, CONTINUING ALONG SAID NORTHERLY LINE, 1024.50 FEET TO THE POINT OF
BEGINNING, THENCE ALONG THE FOLLOWING SEVEN (7) COURSES
I) CONTINUING SOUTH 72°36'36" EAST, ALONG SAID NORTHERLY LINE, 1298.90 FEET TO
THE BEGINNING OF A CURVE, CONCAVE NORTHWESTERLY, HAVING A RADIUS OF 300.00 FEET,
THENCE 2) NORTHEASTERLY, ALONG SAID CURVE AND CONTINUING ALONG SAID
NORTHEASTERLY LINE, THROUGH A CENTRAL ANGLE OF 98°48'57", AN ARC LENGTH OF
517.40 FEET, THENCE 3) NORTH 75°29'20" EAST, 84.02 FEET TO THE SOUTHEAST CORNER
OF PARCEL B OF SAID PARCEL MAP, THENCE 4) NORTH 14°30'40" WEST, ALONG THE
EASTERLY LINE OF SAID PARCEL, 685.51 FEET, THENCE 5) DEPARTING FROM SAID
EASTERLY LINE, SOUTH 75°29'20" WEST, 30.00 FEET, THENCE

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6) NORTH 72°36'36" WEST. 1278.95 FEET, THENCE 7) SOUTH 17°23'24" WEST, 956.50
FEET TO THE POINT OF BEGINNING.
EXCEPTING THEREFROM ALL RIGHTS, TITLE AND INTEREST IN AND TO ALL WATER AND
GROUNDWATER RIGHTS, COAL, OIL, GAS AND OTHER HYDROCARBONS, GEOTHERMAL RESOURCES,
PRECIOUS METALS ORES, BASE METALS ORES, INDUSTRIAL-GRADE SILICATES AND
CARBONATES, FISSIONABLE MINERALS OF EVERY KIND AND CHARACTER, METALLIC OR
OTHERWISE, WHETHER OR NOT PRESENTLY KNOWN TO SCIENCE OR INDUSTRY, NOW KNOWN TO
EXIST OR HEREAFTER DISCOVERED UPON, WITHIN OR UNDERLYING THE SURFACE OF SAID
LAND REGARDLESS OF THE DEPTH BELOW THE SURFACE AT WHICH ANY SUCH SUBSTANCES MAY
BE FOUND, HOWEVER, GRANTOR OR ITS SUCCESSORS AND ASSIGNS, SHALL NOT HAVE THE
RIGHT FOR ANY PURPOSE WHATSOEVER TO ENTER UPON, INTO OR THROUGH THE SURFACE OR
THE FIRST 500 FEET OF THE SUBSURFACE OF THE PROPERTY IN CONNECTION THEREWITH.
PARCEL B:
AN EASEMENT FOR ACCESS, INGRESS AND EGRESS AS DISCLOSED IN DECLARATION OF
COVENANTS, CONDITIONS, RESTRICTIONS AND RESERVATIONS OF EASEMENTS FOR TEJON
INDUSTRIAL COMPLEX RECORDED SEPTEMBER 19, 2000 AS INSTRUMENT NO. 00-116816 OF
OFFICIAL RECORDS AND AS AMENDED BY "AMENDMENT NO. 1 TO GRANT OF EASEMENT"
RECORDED APRIL 29, 2008 AS INSTRUMENT NO. 0208066617 OF OFFICIAL RECORDS AND AS
AMENDED BY "AMENDMENT NO. 2 TO GRANT OF EASEMENT" RECORDED AUGUST 13, 2008 AS
INSTRUMENT NO. 0208129235 OF OFFICIAL RECORDS AND AS AMENDED BY "AMENDMENT NO. 3
TO GRANT OF EASEMENT" RECORDED MARCH 24, 2010 AS INSTRUMENT NO. 0210039033 OF
OFFICIAL RECORDS.
PARCEL C:
AN IRREVOCABLE, PERPETUAL EASEMENT FOR USE AND MAINTENANCE OF THE FIRE LINES AND
FOR DRIVEWAY, INGRESS AND EGRESS AS DISCLOSED IN THE "FIRE FACILITY AND ACCESS
EASEMENT AND MAINTENANCE AGREEMENT" RECORDED AUGUST 20, 2008 AS INSTRUMENT NO.
0208132546 OF OFFICIAL RECORDS.

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EXHIBIT "C"
APPROVED BUSINESS PLAN
TRC-MRC 2, LLC
TO BE PROVIDED LATER
2016 Annual Business Plan

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EXHIBIT "D"
RIGHT OF FIRST REFUSAL
Except for transfers permitted by Sections 6.02(a), (b), (c), (d) and (e), each
time a Member (an "Offeror") proposes to voluntarily transfer, assign, convey,
sell, or otherwise dispose of its entire Interest (an "Offered Interest"), such
Offeror shall first offer such Offered Interest to the non-transferring Member
in accordance with the following provisions:
(a)     The Offeror shall deliver a written notice (the "Offer Notice") to the
non-transferring Member stating (i) such Offeror's bona fide intention to
transfer the Offered Interest, (ii) the name and address of the proposed
transferee, and (iii) the purchase price and terms of payment for which the
Offeror proposes to transfer the Offered Interest. The Offer Notice shall
constitute a revocable offer by the Offeror to sell the Offered Interest to the
other Member on the terms and conditions set forth in this Exhibit "D."
(b)     Within thirty (30) days after receipt of the Offer Notice, the
non-transferring Member shall have the right, but not the obligation, to elect
to purchase the entire Offered Interest for the price and upon the terms and
conditions set forth in the Offer Notice by delivering written notice of such
election (the "Purchase Election") to the Offeror. The failure of
non-transferring Member to submit a notice within such thirty (30) day period
shall constitute an irrevocable rejection of the offer made by the Offeror to
sell the Offered Interest to the non-transferring Member.
(c)     If the non-transferring Member timely elects to purchase the entire
Offered Interest prior to the Offeror's written revocation of the Offer, then
the closing for the Offered Interest shall be made upon the terms and conditions
set forth in the Offer Notice including, without limitation, price, terms of
payment and closing date; provided, however, if the terms of the proposed
transfer include the payment by the Offeror of a commission, then the purchase
price shall be reduced by the amount of such commission. The Offeror and the
non-transferring Member shall execute such documents and instruments and make
such deliveries as may be reasonably required to consummate the transfer.
Notwithstanding any other provisions of this Exhibit "D," the Offeror shall make
the representations and warranties set forth in Section 8.07 of the Agreement at
the closing for the purchase and sale of the Offered Interest.
(d)     If the non-transferring Member does not timely elect to purchase the
entire Offered Interest (or if the non-transferring Member breaches its
obligation to purchase the entire Offered Interest), then the Offeror may
transfer the entire Offered Interest to the proposed transferee described in the
Offer Notice, provided such transfer (i) is completed within ninety

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(90) days after the expiration of the non-transferring Member's right to
purchase the Offered Interest (or within 90 days following the breach by the
non-transferring Member of its obligation to purchase the entire Offered
Interest, if applicable), (ii) is made at the price and on terms and conditions
no less favorable to the Offeror than as described in the Offer Notice,
(iii) would not constitute a default or breach by the Company under any loan
agreement or document to which the Company is a party (unless the lender
consents to such transfer), and (iv) the requirements of Section 6.03 are met.
If the Offered Interest is not so transferred within such ninety (90)-day
period, then the Offeror shall be required to comply again with the provisions
of this Exhibit "D" prior to voluntarily transferring, assigning, conveying,
selling or otherwise disposing of the Offered Interest to any Person (except for
any transfer to any Person permitted by Sections 6.02(a), (b), (c), (d) and (e)
above). In addition, in the event of a breach by the non-transferring Member of
its obligation to purchase, such non-transferring Member shall not have a right
to elect to purchase an Offered Interest with respect to a transfer of an
Interest which is consummated within one (1) year after such breach.
(e)     If any transferee purchases an Interest pursuant to the procedure
described in this Exhibit "D," then such transferee shall be admitted to the
Company as a substituted member upon the closing of such purchase and sale and
the satisfaction of the requirements of Section 6.03.

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