ex10-3.htm


    Exhibit 10.3

     

    OPERATING
AGREEMENT

    OF

    TEAM
NATION INVESTMENT GROUP, LLC

    


    This
OPERATING AGREEMENT (“Agreement”) is made this 20th day of May, 2008, by
A.B.S.I.G. LLC, a California limited liability corporation, and TEAM NATION
HOLDING CORPORATION, a California corporation (each of whom is referred to
individually as a “Member”; all of them are referred to collectively as
“Members”) and is based on the following facts:

     

    RECITALS

    


    1)           The
Articles of Organization of TEAM NATION INVESTMENT GROUP, LLC were filed in the
Office of the Secretary of State of the State of California on May 21,
2008.  A copy is attached hereto marked Exhibit “A” and by this
reference made a part hereof.

    


    2)           By
entering into the Operating Agreement, the Members intend to,  and do,
form a limited liability company pursuant to (and under) the Beverly-Killea
Limited Liability Company Act.

    


    C.           Pursuant
to Paragraph 11.11 of the Operating Agreement, it may be amended only by a
writing signed by all of its Members unless the right to amend is otherwise
expressly set forth in this Agreement.

    


    D.           The
purpose of this Agreement is to provide for the governance of the Company and
the conduct of its business and to set forth the relative rights and obligations
of the Managers and the Members, all as hereinafter set forth.

    


    NOW THEREFORE, the Members
hereby agree as follows:

     

    ARTICLE
I.

    DEFINITIONS

    


    The
following capitalized terms used in this Agreement have the meanings specified
in this Article or elsewhere in this Agreement and when not so defined shall
have the meanings set forth in California Corporations Code
' 17001, et seq.

    


    1.1           “Act” means the Beverly-Killea
Limited Liability Company Act (California Corporations Code
'' 17000-17705), including
amendments from time to time.

    


    1.2           “Agreement” means this
Operating Agreement, as originally executed and as amended from time to
time.

    


    1.3           “Articles of Organization” is
defined in California
Corporations Code ' 17001(b).

    


    1.4           “Assignee” means a person who
has acquired a Member’s Economic Interest in the Company, by way of a Transfer
in accordance with the terms of this Agreement, but who has not become a
Member.

    


    1.5           “Assigning Member” means a
Member who by means of a Transfer has transferred an Economic Interest in the
Company to an Assignee.

    


    1.6           “Capital Account” means, as to
any Member, a separate account maintained and adjusted in accordance with
Article III, Section 3.5.

    


    1.7           “Capital Contribution” means,
with respect to any Member, the amount of the money and the Fair Market Value of
any property (other than money) contributed to the Company (net of liabilities
secured by such contributed property that the Company is considered to assume or
take “subject to” under IRC
section 752) in consideration of a Percentage Interest held by such
Member.  A Capital Contribution shall not be deemed a
loan.

    


    1.8           “Capital Event” means a sale
or disposition of any of the Company’s capital assets, the receipt of insurance
and other proceeds derived from the involuntary conversion of Company property,
the receipt of proceeds from a refinancing of Company property, or a similar
event with respect to Company property or assets.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    1.9           “Carrying Value” means (a)
With respect to a property contributed to the Company by a Member, the agreed
value of such property reduced (but not below zero) by all depreciation, cost
recovery and amortization deductions with respect to such property as taken into
account in determining Profit or Loss, and (b) with respect to any other
property, the adjusted basis of such property for federal income tax purposes as
of the time of determination. The Carrying Value of any property shall be
adjusted from time to time in accordance with sections 4.2and 4.3 and to reflect
changes, additions or other adjustments to the Carrying Value for dispositions,
acquisitions or improvements of Company properties, as deemed appropriate by the
Co-Managers.

    


    1.10           “Cash Available for
Distribution” for any reporting period of the Company shall mean (a) the
funds which the Company shall receive from operations and any other source
(other than from borrowings, refinancing or equity contributions) for any such
period in excess of (b) the total of all cash expenses, reserves and all amounts
paid or accrued by or on behalf of the Company in such period on account of the
amortization of any debts or liabilities of the Company.

    


    1.11           “Cash from Financing” shall
mean the proceeds of any loan made directly to the

    Company
after the payment therefrom of all loan expenses and other debts of the Company
(other than debts owing to the Co-Managers or Members) which are paid off in
conjunction with obtaining such loan.

    


    1.12           “Code” or “IRC” means the Internal
Revenue Code of 1986, as amended, and any successor provision.

    


    1.13           “Company” means the company
named in Article II, Section 2.2.

    


    1.14           “Economic Interest” means a
Person’s right to share in the income, gains, losses, deductions, credit or
similar items of, and to receive distributions from, the Company, but does not
include any other rights of a Member, including the right to vote or to
participate in management.

    


    1.15           “Encumber” means the act of
creating or purporting to create an Encumbrance, whether or not perfected under
applicable law.

    


    1.16           “Encumbrance” means, with
respect to any Membership Interest, or any element thereof, a mortgage, pledge,
security interest, lien, proxy coupled with an interest (other than as
contemplated in this Agreement), option, or preferential right to
purchase.

    


    1.17           “Gross Asset Value” means,
with respect to any item of property of the Company, the item’s adjusted basis
for federal income tax purposes, except as follows:

    


    (i)           The
Gross Asset Value of any item of property contributed by a Member to the Company
shall be the fair market value of such property, as mutually agreed by the
contributing Member and the Company; and

    


    (ii)           The
Gross Asset Value of any item of Company property distributed to any Member
shall be the fair market value of such item of property on the date of
distribution.

    


    1.18           “Initial Member” or “Initial Members” means those
Persons whose names are set forth in the first sentence of this
Agreement.  A reference to an “Initial Member” means any one of the
Initial Members.

    


    1.19           “Involuntary Transfer” means,
with respect to any Membership Interest, or any element thereof, any Transfer or
Encumbrance, whether by operation of law, pursuant to court order, foreclosure
of a security interest, execution of a judgment or other legal process, or
otherwise, including a purported transfer to or from a trustee in bankruptcy,
receiver, or assignee for the benefit of creditors.

    


    1.20           “Losses.”  See “Profits and
Losses.”

    


    1.21           “Majority of Members” means a
Member or Members whose Percentage Interests represent more than 50 percent of
the Percentage Interests of all the Members.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

           
1.22           “Meeting” is defined in
Article V, Section 5.2.

    


    1.23           “Members” means the Initial
Members or Persons who otherwise acquire Membership Interests, as permitted
under this Agreement, and who remain Members.  “Member” shall mean
anyone of them.

     

    1.24           “Notice” means a written
notice required or permitted under this Agreement.  A notice shall be
deemed given or sent when deposited, as certified mail or for overnight
delivery, postage and fees prepaid, in the United States mails; when delivered
to Federal Express, Overnite Express, United Parcel Service, DHL WorldWide
Express, or Airborne Express, for overnight delivery, charges prepaid or charged
to the sender’s account; when personally delivered to the recipient; when
transmitted by electronic means, and such transmission is electronically
confirmed as having been successfully transmitted; or when delivered to the home
or office of a recipient in the care of a person whom the sender has reason to
believe will promptly communicate the notice to the recipient.

    


    1.25           “Percentage Interest” means
the Percentage Interest assigned to the Members (individually or as a class) as
more particularly set forth in Paragraph 3.1 below.  The Percentage
Interest defines each Member’s rights and obligations in regard to Capital
Contributions, Profits and Losses, cash distributions and voting
rights.

    


    1.26           “Person” means an individual,
partnership, limited partnership, trust, estate, association, corporation,
limited liability company, or other entity, whether domestic or
foreign.

    


    1.27           “Profits and Losses” means,
for each fiscal year or other period specified in this Agreement, an amount
equal to the Company’s taxable income or loss for such year or period,
determined in accordance with IRC section
703(a).

    


    1.28           “Property”  means
whatever right, if any, the Company has in (directly or indirectly) in
asset-backed securities in which it may derive an interest by causing them to be
purchased by other entities  and ancillary rights associated therewith
which are owned by the Company.

    


    1.29           “Proxy” has the meaning set
forth in the first paragraph of California Corporations Code
' 17001(ai).  A
Proxy may not be transmitted orally.

    


    1.30           “Regulations” (“Reg”) means
the income tax regulations promulgated by the United States Department of the
Treasury and published in the Federal Register for the purpose of interpreting
and applying the provisions of the Code, as such Regulations may be amended from
time to time, including corresponding provisions of applicable successor
regulations.

    


    1.31           “Substituted Member” is
defined in Article VIII, Section 8.8.

    


    1.32           “Successor in Interest” means
an Assignee, a successor of a Person by merger or otherwise by operation of law,
or a transferee of all or substantially all of the business or assets of a
Person.

    


    1.33           “Transfer” means, with respect
to a Membership Interest, or any element of a Membership Interest, any sale,
assignment, gift, Involuntary Transfer, or other disposition of a Membership
Interest or any element of such a Membership Interest, directly or indirectly,
other than an Encumbrance that is expressly permitted under this
Agreement.

    


    1.34           “Triggering Event” is defined
in Article VIII, Section 8.2.

    


    1.35           “Vote” means a written consent
or approval, a ballot cast at a Meeting, or a voice vote.

    


    1.36           “Voting Interest” means, with
respect to a Member, the right to Vote or participate in management and any
right to information concerning the business and affairs of the Company provided
under the Act, except as limited by the provisions of this
Agreement.  A Member’s Voting Interest shall be directly proportional
to the Member’s Percentage Interest.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ARTICLE
II.

    ARTICLES OF ORGANIZATION;
PURPOSE OF COMPANY

    


    2.1           Prior
to the execution of this Agreement, the Members have caused the Articles of
Organization in the form attached to this Agreement as Exhibit “A” to be filed
with the California Secretary of State.

    


    2.2           The
name of the Company is TEAM
NATION INVESTMENT GROUP, LLC.

    


    2.3           The
principal executive office of the Company shall be at 707 Broadway, 18th Floor,
San Diego 92101, or such other place or places as may be determined by the
Members from time to time.

    


    2.4           The
initial agent for service of process on the Company shall be J. Thomas
Epperson.  A Majority of Members may from time to time change the
Company’s agent for service of process.

    


    2.5           The
sole purpose of the Company is to (i) investigate and identify asset-backed
securities which are then issued and performing; (ii) negotiate for the purchase
of such securities on behalf of each entity into which the securities are placed
(by purchase); (iii) assist in managing such purchases; (iv) monitor the
performance of such securities; (v) direct how the income from such securities
will be distributed; and (vi) determine when (if at all) any of such securities
should be sold.  The Company also shall have such ancillary purposes
as are necessary or helpful in performing the Company’s sole purpose identified
above.  The Company shall not engage in any other business without the
amendment of this Paragraph 2.5 by the unanimous consent of the
Members.

    


    2.6           The
term of existence of the Company commenced on the effective date of filing of
Articles of Organization with the California Secretary of State, i.e., February
13, 2008, and has continued, and shall continue, until October 31, 2034, unless
sooner terminated by the provisions of this Agreement or as provided by
law.

    


    2.7           A.B.S.I.G.
LLC, and TEAM NATION HOLDING CORPORATION shall be the Co-Managers of the
Company.

     

    ARTICLE
III.

    CAPITALIZATION

    


    3.1           The
authorized capital of the Company is Five Thousand Dollars
($5,000.00).  Upon the organization of the Company, the following cash
contributions are to be made by the Members in exchange for their respective
Percentage Interests:

    


    
      	
               

              Member

            	 	
              Member’s

              Percentage Interest

            	 	 	
              Cash

              Contribution

            	 
	
              A.B.S.I.G.
      LLC

            	 	 	50	%	 	$	500.00	 
	
              Team
      Nation Holding Corporation

            	 	 	50	%	 	$	500.00	 
	 
      	 	 	 	 	 	 	 	 
	
              Total
      Contribution:

            	 	 	 	 	 	$	1,000.00	 


    

    


    3.2           New
Equity.  If at any time in the future the Company shall be in
need of additional capital, the Company is authorized to seek and obtain the
same.  Such additional capital will be allocable either to the present
Members (to the extent that each of them makes an additional contribution) and
to other classes of Members, if any,  with their rights defined and
agreed upon as such cash is obtained.  The decision to seek additional
equity will require the approval of the Co-Managers owning more than fifty
percent (50%) of the Class “A” Percentage Interests.

    


    3.3           Capital
Account.  An individual Capital Account shall be maintained for
each Member consisting of that Member’s Capital Contribution, (1) increased by
that Member’s share of Profits, (2) decreased by that Member’s share of Losses
and Company expenses (to the extent not included in the calculation of Profits
and Losses), and (3) adjusted as required in accordance with applicable
provisions of the Code and Regulations.

    


    3.4           A
Member shall not be entitled to withdraw any part of the Member’s Capital
Contribution or to receive any distributions, whether of money or property, from
the Company except as provided in this Agreement.

    


    3.5           No
interest shall be paid on funds or property contributed to the capital of the
Company or on the balance of a Member’s Capital Account.

    


    3.6           A
Member shall not be bound by, or be personally liable for, the expenses,
liabilities or obligations of the Company except as otherwise provided in the
Act or in this Agreement.

    


    3.7           No
Member shall have priority over any other Member, with respect to the return of
a Capital Contribution, or distributions or allocations of income, gain, losses,
deductions, credits, or items thereof.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

      ARTICLE
IV.

      ALLOCATIONS AND
DISTRIBUTIONS

    

    


    4.1           The
Profits and Losses of the Company and all items of Company income, gain, loss,
deduction or credit shall be allocated, for Company book purposes and for tax
purposes, to a Member in accordance with the Member’s Percentage
Interest.

    


    4.2           If
any Member unexpectedly receives any adjustment, allocation, or distribution
described in Reg sections 1.704-1(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or
1.704-1(b)(2)(ii)(d)(6), items of Company gross income and gain shall be
specially allocated to that Member in an amount and manner sufficient to
eliminate any deficit balance in the Member’s Capital Account created by such
adjustment, allocation, or distribution as quickly as possible.  Any
special allocation under this Section 4.2 shall be taken into account in
computing subsequent allocations of Profits and Losses so that the net amount of
allocations of income and loss and all other items shall, to the extent
possible, be equal to the net amount that would have been allocated if the
unexpected adjustment, allocation, or distribution had not
occurred.  The provisions of this Section 4.2 and the other provisions
of this Agreement relating to the maintenance of Capital Accounts are intended
to comply with Reg sections 1.704-1(b) and 1.704-2 and shall be interpreted and
applied in a manner consistent with such Regulations.

    


    4.3           Any
unrealized appreciation or unrealized depreciation in the values of Company
property distributed in kind to all the Members shall be deemed to be Profits
and Losses realized by the Company immediately prior to the distribution of the
property, and such Profits or Losses shall be allocated to the Members’ Capital
Accounts in the same proportions as Profits are allocated under Section
4.1.  Any property so distributed shall be treated as a distribution
to the Members to the extent of the Fair Market Value of the property less the
amount of any liability secured by and related to the
property.  Nothing contained in this Agreement is intended to treat or
cause such distributions to be treated as sales for value.  For the
purposes of this Section 4.3, “unrealized appreciation” or “unrealized
depreciation” shall mean the difference between the Fair Market Value of such
property and the Company’s basis for such property.

    


    4.4           In
the case of a Transfer of an Economic Interest during any fiscal year, the
Assigning Member and Assignee each shall be allocated of Profits or Losses based
on the number of days each held the Economic Interest during that fiscal
year.

    


    4.5           All
cash resulting from the normal business operations of the Company and from a
Capital Event shall be distributed among the Members in proportion to their
Percentage Interests at such times as the Members may agree.  Cash
obtained from normal business operations of the Company which constitutes Cash
Available for Distribution shall be distributed by the Company at such time as
the Co-Managers determine that such Cash Available for Distribution is
available.  The Co-Managers will use their best efforts to assure that
there are distributions made during each calendar year of the Company’s term of
not less than forty percent (40%) of the Profits of the company for such year so
that the Members will have cash distributed to them to pay income taxes on their
respective shares of the Company’s Profits for such year.

    


    4.6           If
the proceeds from a sale or other disposition of an item of Company consists of
property other than cash, the value of such property shall be as determined by
the Members.  Such non-cash proceeds shall then be allocated among all
the Members in proportion to their Percentage Interests.  If such
non-cash proceeds are subsequently reduced to cash, such cash shall be
distributed to each Member in accordance with Section 4.5.

    


    4.7           Notwithstanding
any other provisions of this Agreement to the contrary, when there is a
distribution in liquidation of the Company, or when any Member’s interest is
liquidated, all items of income and loss first shall be allocated to the
Members’ Capital Accounts under this Article IV, and other credits and
deductions to the Members’ Capital Accounts shall be made before the final
distribution is made.  The final distribution to the Members shall be
made to the Members to the extent of and in proportion to their positive Capital
Account balances.

     

    ARTICLE
V.

    MANAGEMENT

    


    5.1           The
business of the Company shall be managed by its two
Co-Managers.    Unless otherwise provided in this Agreement,
all decisions concerning the management of the Company’s business shall be made
by the vote or written consent of all of the Co-Managers.  The two
Co-Managers are:  A.B.S.I.G. LLC, and TEAM NATION HOLDING
CORPORATION.

    


    5.2           The
Co-Managers are not required to hold meetings, and decisions may be reached
through one or more informal consultations followed by agreement among the two
Co-Managers, provided that all Co-Managers are consulted (although all
Co-Managers need not be present during a particular consultation), or by a
written consent signed by all two of them.  In the event that Members
wish to hold a formal meeting (a “Meeting”) for any reason, the following
procedures shall apply:

    


    (1)           If
required, any one of the two Co-Managers, may call a meeting of Co-Managers by
giving Notice of the time and place of the meeting at least 48 hours prior to
the time of the holding of the meeting.  The Notice need not specify
the purpose of the Meeting or the location if the Meeting is to be held at the
principal executive office of the Company or if it is held
telephonically.

    


    (b)           Two
of the Co-Managers shall constitute a quorum for the transaction of business at
any Meeting of the Co-Managers; provided that they shall use their best efforts
to bring the remaining Co-Manager to the meeting; including by
telephone.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (c)           The
transactions of the Co-Managers at any meeting, however called or noticed, or
wherever held, shall be as valid as though transacted at a Meeting duly held
after call and notice if a quorum is present and if, either before or after the
Meeting, each Co-Manager not present signs a written waiver of Notice, a consent
to the holding of the Meeting, or an approval of the minutes of the
Meeting.

    


    (d)           Any
action required or permitted to be taken by the Co-Managers under this Agreement
may be taken without a Meeting if all of the Co-Managers individually or
collectively consent in writing to such action.

    


    (e)           Co-Managers
may participate in the Meeting through the use of a conference telephone or
similar communications equipment, provided that all Co-Managers participating in
the Meeting can hear one another.

    


    (6)           All
decisions made by the Co-Managers as hereinabove described shall be based on the
following: The Co-Managers are allocated one vote, and decisions must be
unanimous.

    


    (7)           The
Co-Managers shall keep or cause to be kept with the books and records of the
Company full and accurate minutes of all Meetings, Notices, and waivers of
Notices of Meetings, and all written consents in lieu of Meetings.

    


    5.3           Intentionally
omitted.

    


    5.4           Notwithstanding
the other provisions of this Agreement, two of the Co-Managers must execute all
documents on behalf of the Company provided that such documents conform to
decisions approved by all of the Co-Managers.  “Documents” shall
include, but are not limited to, (i) all documents affecting title to personal
property (including, without limitation, directions to escrow accounts,
collection accounts and distribution accounts; (ii) directions to purchase and
sell certain asset-backed securities;  (iii) documents opening and
maintaining bank accounts, (iv) endorsements of checks and withdrawal slips on
such bank accounts, (v) contracts for the employment of persons for the Company;
(v) leases of offices; and (vi) other documents reasonably required in the
ordinary course of the Company’s business.

    


    5.5           All
assets of the Company, whether real or personal, shall be held in the name of
the Company.

    


    5.6           All
funds of the Company shall be deposited in one or more accounts with one or more
recognized financial institutions in the name of the Company at such locations
as shall be determined by all of the Co-Managers.  Withdrawals from
such accounts shall require the signature(s) of such person or persons as all of
the Co-Mangers may designate.

     

    ARTICLE
VI.

    ACCOUNTS AND
RECORDS

    


    6.1           Complete
books of account of the Company’s business, in which each Company transaction
shall be fully and accurately entered, shall be kept at the
Company’s

    principal
executive office and shall be open to inspection and copying by each Member or
the Member’s authorized representatives on reasonable Notice during normal
business hours.  The costs of such inspection and copying shall be
borne by the Member.

    


    6.2           Financial
books and records of the Company shall be kept on the method of accounting
followed by the Company for federal income tax purposes to the extent allowed by
law.  A balance sheet and income statement of the Company shall be
prepared promptly following the close of each fiscal year in a manner
appropriate to and adequate for the Company’s business and for carrying out the
provisions of this Agreement.  The fiscal year of the Company shall be
January 1 through December 31.

    


    6.3           At
all times during the term of existence of the Company, and beyond that term if a
Majority of the Members deem it necessary, the Members shall keep or cause to be
kept the books of account referred to in Section 6.2 and the
following:

    


    (i)           A
current list of the full name and last known business or residence address of
each Member, together with the Capital Contribution and the share in Profits and
Losses of each Member;

    


    (ii)           A
copy of the Articles of Organization, as amended;

    


    (iii)           Copies
of the Company’s federal, state, and local income tax or information returns and
reports, if any, for the six most recent taxable years;

    


    (iv)           Executed
counterparts of this Agreement, as amended;

    


    (v)           Any
powers of attorney under which the Articles of Organization or any amendments
thereto were executed;

    


    (vi)           Financial
statements of the Company for the six most recent fiscal years; and

    


    (vii)           The
Books and Records of the Company as they relate to the Company’s internal
affairs for the current and past four fiscal years.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    If a
Majority of Members deem that any of the foregoing items shall be kept beyond
the term of existence of the Company, the repository of said items shall be as
designated by a Majority of Members.

    


    6.4           Within
90 days after the end of each taxable year of the Company, the Company shall
send to each of the Members all information necessary for the Members to
complete their federal and state income tax or information returns, and a copy
of the Company’s federal, state, and local income tax or information returns for
such year.

     

    ARTICLE
VII.

    MEMBERS AND
VOTING

    


    7.1           Each
Member shall Vote in proportion to the Member’s Percentage Interest as of the
governing record date, determined in accordance with Section 7.2.  Any
action that may or that must be taken by the Members shall be by unanimous
vote.

    


    7.2           The
record date for determining the Members entitled to Notice of any Meeting and to
(i) vote, (ii) receive any distribution or (iii) exercise any right in respect
of any other lawful action, shall be the date set by a Majority of Members,
provided that such record date shall not be more than 60, nor less than 10 days
prior to the date of the Meeting, nor more than 60 days prior to any other
action.

    


    In the
absence of any action setting a record date, the record date shall be determined
in accordance with California
Corporations Code ' 17104(k).

    


    7.3           At
all Meetings of Members, a Member may Vote in person or by
Proxy.  Such proxy shall be filed by any Member before or at the time
of the Meeting, and may be filed by facsimile transmission to a Co-Manager at
the principal executive office of the Company or such other address as may be
given by the Co-Managers to the Members for such purposes.

     

    ARTICLE
VIII.

    TRANSFERS OF MEMBERSHIP
INTERESTS

    


    8.1           
Except as expressly provided in this Agreement, a Member shall not Transfer any
part of the Member’s Membership Interest in the Company, whether now owned or
hereafter acquired, unless (1) the other Member(s) owning at last two-thirds of
the Percentage Interests (excluding the Percentage Interest allocable to the
withdrawing Members) approve the transferee’s admission to the Company as a
Member upon such Transfer and (2) the Membership Interest to be transferred,
when added to the total of all other Membership Interests transferred in the
preceding 12 months, will not cause the termination of the Company under the
Code.  No Member may Encumber or permit or suffer any Encumbrance of
all or any part of the Member’s Membership Interest in the Company unless such
Encumbrance has been approved in writing by one hundred percent (100%) of the
Co-Managers.  Any Transfer or Encumbrance of a Membership Interest
without such approval shall be void.  Notwithstanding any other
provision of this Agreement to the contrary, a Member who is a natural person
may transfer all or any portion of his or her Membership Interest to any
revocable trust created for the benefit of the Member, or any combination
between or among the Member, the Member’s spouse and the Member’s issue;
provided that the Member retains a beneficial interest in the trust and all of
the Voting Interest included in such Membership Interest.  A transfer
of a Member’s entire beneficial interest in such trust or failure to retain such
Voting Interest shall be deemed a Transfer of a Membership
Interest.

    


    8.2           On
the happening of any of the following events (“Triggering Events”) with respect
to a Member, the Company and the other Members, if any, shall have the option to
purchase all or any portion of the Membership Interest in the Company of such
Member (Selling Member) at the price and on the terms provided in Section 8.7 of
this Agreement:

    


    (a)           the
death or incapacity of a Member;

    


    (b)           the
bankruptcy of a Member; or

    


    (c)           except
for the events stated in Section 8.3, the occurrence of any other event that is,
or that would cause, a Transfer in contravention of this Agreement.

    


    Each
Member agrees to give prompt Notice of a Triggering Event to all other
Members.

    


    8.3           Notwithstanding
any other provisions of this Agreement:

    


    (i)           If,
in connection with the divorce or dissolution of the marriage of a Member, any
court issues a decree or order that transfers, confirms or awards a Membership
Interest, or any portion thereof, to that Member’s spouse (an Award), then,
notwithstanding that such transfer would constitute an unpermitted Transfer
under this Agreement, that Member shall have the right to purchase from his or
her former spouse the Membership Interest, or portion thereof, that was so
transferred, and such former spouse shall sell the Membership Interest or
portion thereof to that Member at the price set forth in Section 8.7 of this
Agreement.  If the Member has failed to consummate the purchase within
90 days after the Award (the Expiration Date), the Company shall have the option
to purchase from the former spouse the Membership Interest or portion thereof
pursuant to Section 8.5 of this Agreement; provided that the option period shall
commence on the later of (1) the day following the Expiration Date, or (2) the
date of actual notice of the Award.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (ii)           If,
by reason of the death of a spouse of a Member, any portion of a Membership
Interest is transferred to a Transferee other than (1) that Member or (2) a
trust created for the benefit of that Member (or for the benefit of that Member
and any combination between or among the Member and the Member’s issue) in which
the Member is the sole Trustee and the  Member, as Trustee or
individually, possesses all of the Voting Interest included in that Membership
Interest, then the Member shall have the right to purchase the Membership
Interest or portion thereof from the estate or other successor of his or her
deceased spouse or Transferee of such deceased spouse, and the estate,
successor, or Transferee shall sell the Membership Interest or portion thereof
at the price set forth in Section 8.7 of this Agreement.  If the
Member has failed to consummate the purchase within 90 days after the date of
death (the Expiration Date), the Company shall have the option to purchase from
the estate or other successor of the deceased spouse the Membership Interest or
portion thereof pursuant to Section 8.5 of this Agreement; provided that the
option period shall commence on the later of (1) the day following the
Expiration Date, or (2) the date of actual notice of the death.

    


    8.4           On
the receipt of Notice by the other Members as contemplated by Section 8.1, and
on receipt of actual notice of any Triggering Event (the date of such receipt is
hereinafter referred to as the “Option Date”), the remaining Co-Managers shall
promptly give notice of the occurrence of such a Triggering Event to each
Co-Manager, and the Company shall have the option, for a period ending 30
calendar days following the determination of the purchase price as provided in
Section 8.6, to purchase the Membership Interest in the Company to which the
option relates, at the price and on the terms provided in Section
8.6.  The transferee of the Membership Interest in the Company that is
not purchased shall hold such Membership Interest in the Company subject to all
of the provisions of this Agreement.

    


    8.5           No
Member shall participate in any Vote or decision in any matter pertaining to the
disposition of that Member’s Membership Interest in the Company under this
Agreement.

    


    8.6           The
purchase price of the Membership Interest that is the subject of an option under
this Agreement shall be the Fair Market Value of such Membership Interest as
determined under this Section 8.6.  Each of the selling and purchasing
parties shall use his, her, or its best efforts to mutually agree on the Fair
Market Value.  If the parties are unable to so agree within 30 days of
the date on which the option is first exercisable (the Option Date), the selling
party shall appoint, within 40 days of the Option Date, one appraiser, and the
purchasing party shall appoint within 40 days of the Option Date, one
appraiser.  The two appraisers shall within a period of five
additional business days, agree on and appoint an additional
appraiser.  The three appraisers shall, within 60 days after the
appointment of the third appraiser, determine the Fair Market Value of the
Membership Interest in writing and submit their report to all the
parties.  The Fair Market Value shall be determined by disregarding
the appraiser’s valuation that diverges the greatest from each of the other two
appraisers’ valuations, and the arithmetic mean of the remaining two appraisers’
valuations shall be the Fair Market Value.  Each purchasing party
shall pay for the services of the appraiser selected by it, plus one-half of the
fee charged by the third appraiser.  The option purchase price as so
determined shall be payable in cash.

    


    8.7           Except
as expressly permitted under Section 8.1, a prospective transferee (other than
an existing Member) of a Membership Interest may be admitted as a Member with
respect to such Membership Interest (Substituted Member) only (1) on the
unanimous Vote of the (remaining) Co-Managers in favor of the prospective
transferee’s admission as a Member, and (2) on such prospective transferee’s
executing a counterpart of this Agreement as a party hereto.  Any
prospective transferee of a Membership Interest shall be deemed an Assignee,
and, therefore, the owner of only an Economic Interest until such prospective
transferee has been admitted as a Substituted Member.

    


    8.8           Any
person admitted to the Company as a Substituted Member shall be subject to all
provisions of this Agreement.

    


    8.9           The
original issuance of Membership Interests in the Company to the original Members
has not been qualified or registered under the Securities Act of 1933, as
amended, in reliance upon exemptions from the registration provisions of those
laws.  No attempt has been made to qualify the offering and issuance
of Membership Interests to Members under the California Corporate Securities Law
of 1968, as amended, also in reliance upon an exemption from the
requirement that a permit for issuance of securities be
procured.  Notwithstanding any other provision of this Agreement,
Membership Interests may not be Transferred or Encumbered unless registered or
qualified under applicable state and federal securities law or unless, in the
opinion of legal counsel satisfactory to the Company, such qualification or
registration is not required.  The Member who desires to transfer a
Membership Interest shall be responsible for all legal fees incurred in
connection with said opinion.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ARTICLE
IX.

    DISSOLUTION AND WINDING
UP

    


    9.1           The
Company shall be dissolved only on the first to occur of the following
events:

    


    (i)           The
death, incapacity, or withdrawal of a Co-Manager; or the bankruptcy or
dissolution of a Co-Manager; provided, however, that the remaining Co-Managers
may, by their unanimous approval within 90 days after the happening of that
event, elect to continue the Company, in which case the Company shall not be
dissolved.  If the remaining Co-Managers fail to so elect, the
(remaining) Co-Managers shall dissolve and wind up the Company.

    


    (ii)           The
expiration of the term of existence of the Company.

    


    (iii)           The
written agreement of those Members owning more than fifty percent (50%) of the
Percentage Interests to dissolve the Company.

    


    (iv)           The
sale or other disposition of substantially all of the Company
assets.  (The election to sell all or substantially all of the
Property can be made only by the Co-Managers but also will require the vote or
written consent of those Members owning more than fifty percent (50%) of the
Percentage Interests in the partnership.)

    


    (v)           Entry
of a decree of judicial dissolution pursuant to California Corporations Code
' 27351.

    


    9.2           On
the dissolution of the Company, the Company shall engage in no further business
other than that necessary to wind up the business and affairs of the
Company.  The Co-Managers and Members who have not wrongfully
dissolved the Company shall wind up the affairs of the Company.  The
Persons winding up the affairs of the Company shall give written Notice of the
commencement of winding up by mail to all known creditors and claimants against
the Company whose addresses appear in the records of the
Company.  After paying or adequately providing for the payment of all
known debts of the Company (except debts owing to Members) the remaining assets
of the Company shall be distributed or applied in the following order of
priority:

    


    (i)           To
pay the expenses of liquidation.

    


    (b)           To
repay any loan theretofore made by a Co-Manager to the Company.

    


    (c)           Among
the Members in accordance with the provisions of Article IV, Section
4.7.

    


    9.3           Each
Member shall look solely to the assets of the Company for the return of the
Member’s investment, and if the Company property remaining after the payment or
discharge of the debts and liabilities of the Company is insufficient to return
the investment of any Member, such Member shall have no recourse against any
other Members for indemnification, contribution, or reimbursement.

    


    ARTICLE
X.

    ARBITRATION

    


    Any
action to enforce or interpret this Agreement or to resolve disputes between the
Members or by or against any Member shall be settled by arbitration in
accordance with the rules of the American Arbitration
Association.  Arbitration shall be the exclusive dispute resolution
process in the State of California, but arbitration shall be a nonexclusive
process elsewhere.  Any party may commence arbitration by sending a
written demand for arbitration to the other parties.  Such demand
shall set forth the nature of the matter to be resolved by
arbitration.  Arbitration shall be conducted at San Diego,
California.  The substantive law of the State of California shall be
applied by the arbitrator to the resolution of the dispute.  The
parties shall share equally all initial costs of arbitration.  The
prevailing party shall be entitled to reimbursement of attorney fees, costs, and
expenses incurred in connection with the arbitration.  All decisions
of the arbitrator shall be final, binding, and conclusive on all
parties.  Judgment may be entered upon any such decision in accordance
with applicable law in any court having jurisdiction thereof.

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    ARTICLE
XI.

    GENERAL
PROVISIONS

    


    11.1           This
Agreement constitutes the whole and entire agreement of the parties with respect
to the subject matter of this Agreement, and it shall not be modified or amended
in any respect except by a written instrument executed by all the
parties.  This Agreement replaces and supersedes all prior written and
oral agreements by and among the Members or any of them.

    


    11.2           This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute one and the same
instrument.  Each signed counterpart is effective when it is delivered
to the principal office of the Company by (i) hand-delivery, (ii) facsimile or
(iii) pdf.

    


    11.3           This
Agreement shall be construed and enforced in accordance with the internal laws
of the State of California.  If any provision of this Agreement is
determined by any court of competent jurisdiction or arbitrator to be invalid,
illegal or unenforceable to any extent, that provision shall, if possible, be
construed as though more narrowly drawn, if a narrower construction would avoid
such invalidity, illegality, or unenforceability, or if that is not possible,
such provision shall, to the extent of such invalidity, illegality or
unenforceability, be severed, and the remaining provisions of this Agreement
shall remain in effect.

    


    11.4           This
Agreement shall be binding on and inure to the benefit of the parties and their
heirs, personal representatives and permitted successors and
assigns.

    


    11.5           Whenever
used in this Agreement, the singular shall include the plural, the plural shall
include the singular, and the neuter gender shall include the male and female as
well as a trust, firm, company, or corporation, all as the context and meaning
of this Agreement may require.

    


    11.6           The
parties to this Agreement shall promptly execute and deliver any and all
additional documents, instruments, notices and other assurances and shall do any
and all other acts and things reasonably necessary in connection with the
performance of their respective obligations under this Agreement and to carry
out the intent of the parties.

    


    11.7           Except
as provided in this Agreement, no provision of this Agreement shall be construed
to limit in any manner the Members in the carrying on of their own respective
businesses or activities.

    


    11.8           Except
as provided in this Agreement, no provision of this Agreement shall be construed
to constitute a Member, in the Member’s capacity as such, the agent of any other
Member.

    


    11.9           Each
Member represents and warrants to the other Members that the Member has the
capacity and authority to enter into this Agreement.

    


    11.10                      The
article, section and paragraph titles and headings contained in this Agreement
are inserted as matter of convenience and for ease of reference only and shall
be disregarded for all other purposes, including the construction or enforcement
of this Agreement or any of its provisions.

    


    11.11                      This
Agreement may be altered, amended or repealed only by a writing signed by all of
the Members.

    


    11.12                      Time
is of the essence of every provision of this Agreement that specifies a time for
performance.

    


    11.13                      This
Agreement is made solely for the benefit of the parties to this Agreement and
their respective permitted successors and assigns, and no other person or entity
shall have or acquire any right by virtue of this Agreement.

    


    11.14                      The
Members intend the Company to be a limited liability company under the
Act.  No member shall take any action inconsistent with the express
intent of the parties to this agreement.

     

    [SIGNATURE
PAGE FOLLOWS.]

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    IN WITNESS WHEREOF, each of
the undersigned has executed or caused to be executed this Agreement on the day
and year first above written.

    


    


    
      	
              A.B.S.I.G.
      LLC

               

              By:   _________________________________________                                                             

               

              Name:________________________________________

               

              Title:_________________________________________

               

               

              TEAM
      NATION HOLDING COPRORATION

               

              By:___________________________________________

               

              Name:_________________________________________

               

              Title:__________________________________________

               

               

               

            	 
      


    

     

    
 

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    


    [Exhibit
“A” to the Operating Agreement of TEAM NATION INVESTMENT
GROUP, LLC]

    


    ARTICLES
OF ORGANIZATION