OPERATING AGREEMENT OF MELT FRANCHISING, LLC

OPERATING AGREEMENT

MELT FRANCHISING, LLC

This Operating Agreement (this “Agreement”), made by Melt Inc., a Nevada corporation (“Member”), takes effect on February 25, 2005.

RECITALS

A.	The undersigned Members, representing all of the Members of the Company, desire to enter into this Agreement, which is intended to constitute an operating agreement within the meaning of Chapter 86 of the Nevada Revised Statutes (Nevada Revised Statutes § 86.011, et seq.) (the “Act”).
B.	For purposes of this Agreement, capitalized terms used in this Agreement have the meanings set forth below. Capitalized terms used but not defined in this Agreement have the meanings set forth in the Act.

ARTICLE 1

DEFINITIONS

1.1	“Act” means the limited liability company act of the State of Nevada, which is presently Chapter 86 of the Nevada Revised Statutes (Nevada Revised Statutes § 86.011, et seq.), as amended from time to time.
1.2	“Affiliate,” with respect to any Person, means (a) any Person directly or indirectly controlling, controlled by, or under common control with such Person, (b) any Person owning or controlling 10% or more of the outstanding voting securities of such other Person, (c) any officer, director, or partner of such Person, and (d) if such other Person is an officer, director, or partner, any company for which such Person acts in any such capacity.
1.3	“Agreement” means this Operating Agreement, and all amendments, schedules, exhibits and modifications hereto.
1.4	“Articles of Organization” means the Articles of Organization of the Company filed with the Nevada Secretary of State, as the same may be amended from time to time.
1.5	“Assignee” means a transferee of an interest in the Company who has not been admitted as a Substitute Member.
1.6	“Capital Account” means the account of a Member established and maintained in accordance with the provisions of Section 4.1 hereof.
.7	“Capital Contribution” means, with respect to a Member, the total amount of cash and the agreed upon fair market value of property contributed or agreed to be contributed by such Member to the capital of the Company.

1.8	“Code” means the Internal Revenue Code of 1986, as amended, and any successor thereto. Any reference to specific Sections of the Code shall be to the Section as it now exists and to any successor provision.
1.9	“Company” means Melt Franchising, LLC, a Nevada limited liability company.
1.10	“Distribution” means the total amount of cash and/or the fair market value of property distributed by the Company to a Member from time to time with respect to his or her interest as a Member of the Company.
1.11	“Manager” has the meaning set forth in Section 5.3.
1.12	“Management Board” shall have the meaning set forth in Section 5.3.
1.12	“Member” means a member of the Company as named herein and any additional member or Substitute Member admitted pursuant to this Agreement. An assignee who has not been admitted as a Substitute Member is not a Member for any purpose.
1.13	“Person” means any natural person and any corporation, partnership, trust, association, or other legal entity.
1.14	“Substitute Member” means an Assignee who has been admitted to the Company with all of the rights of membership in the Company pursuant to the Agreement.
1.15	“Unit” means an interest in the Company with rights to Distributions from the Company and to share in the gains, profits, and losses of the Company as set forth herein.

ARTICLE 2

FORMATION

.1	Formation of Limited Liability Company. The Company has been organized as a Nevada limited liability company under the Act by the filing of the Articles of Organization required by the Act. The rights and liabilities of the Members are as provided in the Act, except as otherwise expressly provided herein or in the Articles of Organization.
2.2	Members. Melt Inc. is the initial Member of the Company, and it agrees to the terms of this Agreement and to be fully bound hereby. The addresses of the initial Member is as follows:

Melt Inc.

00000 Xxxxx Xxxxxxx

Xxxxxxxx, Xxxxxxxxxx 00000

2.3	Name. The name of the Company is Melt Franchising, LLC. The Company may also conduct business under one or more assumed names.
2.4	Offices. The Company’s registered office within the State of Nevada shall be located at 0000 Xxxx Xxxx, Xxxxx 000, Xxxx Xxxxxx 00000, or such other place as the Members may

from time to time determine. The Company’s principal executive office shall be located at 00000 Xxxxx Xxxxxxx, Xxxxxxxx, Xxxxxxxxxx 00000, or such other place as the Members may from time to time determine. The Company may maintain such other offices at such other places as the Members deem advisable.

2.5	Purposes. The Company is formed for general business purposes consistent with the Act. The Company shall have all of the powers necessary or convenient to effect any purpose for which it is formed, including all powers granted by the Act.
2.6	Term. The period of existence of this limited liability company shall be perpetual, or unless earlier dissolved in accordance with law.

2.7	Registered Agent. The Company’s registered agent in Nevada is The Corporation Trust Company of Nevada. The registered agent may be changed from time to time in accordance with the Act. If the registered agent resigns, the Company shall promptly appoint a successor.
2.8	Title to Property. All property owned by the Company, whether real or personal, tangible or intangible, is deemed to be owned by the Company as an entity, and no Member, individually, has any ownership interest in any such property.
2.9	Waiver of Partition. Each Member hereby waives any and all rights such Member may have to a partition of any Company property or properties.
2.10	Intention for Company. The Members have formed the Company as a limited liability company under the Act. The Members specifically intend that the Company not be a general or limited partnership or any other joint or cooperative venture. No Member or Manager shall be construed to be a partner in the Company or a partner or other joint venturer of or with any other Member, Manager, or person.

ARTICLE 3

CAPITAL CONTRIBUTIONS

3.1	Initial Capital Contributions. As their initial Capital Contributions to the Company, the Members agree to make the Capital Contributions set forth on Schedule A, which is attached hereto and made a part of this Agreement, for which they will receive the number of Units set forth on Schedule A.
3.2	Additional Capital Contributions; Nonassessability. No additional Captial Contributions are presently contemplated. No Member will be required to make any Capital Contribution in excess of the amount stated in Section 3.1 unless agreed by all Members.
3.3	No Right to Return of Contribution. The Members have no right to withdraw or to receive a return of their Capital Contributions, as reflected in their respective Capital Accounts from time to time, except upon the dissolution and liquidation of the Company pursuant to Article 11.

3.4

Loans from Members to Company. Subject to any other restrictions contained herein, the Company may borrow money from one or more Members at such interest rate or rates and upon such other terms as are agreed upon by the Company and the lending Member; provided that the interest rate on any such loans may not exceed the rate that would apply to Company borrowing on similar terms from recognized banks or financial institutions.

3.5

No Interest on Contributions. No interest shall be paid to any Member on Capital Contributions.

ARTICLE 4

ALLOCATIONS OF PROFITS

AND LOSSES; DISTRIBUTIONS

4.1	Capital Accounts.
	(a)	The Company will maintain a separate Capital Account for each Member. The Capital Account for each Member shall be increased by such Member’s Capital Contributions and decreased by Distributions made to such Member. Each Member’s Capital Account also shall be increased or decreased, as the case may be, to account for profits and losses (and items thereof required to be taken into account by applicable Treasury Regulations) that are allocated to such Member.
	(b)	The Members’ Capital Accounts shall also be maintained and adjusted as permitted by the provisions of Treasury Regulation § 1.704-1(b)(2)(iv)(f) and as required by the other provisions of Treasury Regulation §§ 1.704-1(b)(2)(iv) and 1.704-1(b)(4), including adjustments to reflect the allocations to the Members of depreciation, depletion, amortization, and gain or loss as computed for book purposes rather than the allocation of the corresponding items as computed for tax purposes, as required by Treasury Regulation § 1.704-1(b)(2)(iv)(g). As a consequence, the Members’ Capital Accounts shall be increased or decreased to reflect a revaluation of the Company’s property on its books, based on the fair market value of the Company’s property on the date of adjustment, immediately prior to (A) the contribution of money or other property to the Company by a new or existing Member as consideration for an additional Membership Interest, (B) the Distribution of money or other property by the Company to a Member as consideration for a Membership Interest, (C) the liquidation of the Company. The Members’ Capital Accounts shall be further adjusted as appropriate to reflect the Members’ Membership Interests upon the exercise of any option or conversion right by which a Member acquires, or changes the nature and rights of, a Membership Interest.

4.2	Allocations of Profit and Losses. Profits and losses of the Company shall be allocated pro rata among the Members in proportion to their Units.
4.3	Allocations to Reflect Book/Tax Differences. For income tax purposes, income, gain, loss, and deduction with respect to property contributed to the Company by a Member or revalued pursuant to Treasury Regulation § 1.704-1(b)(2)(iv)(f) shall be allocated among the Members in a manner that takes into account the variation between the adjusted tax basis of such property and its book value, as required by Section 704(c) of the Code and Treasury Regulation § 1.704-1(b)(4)(i), using such allocation method permitted by Treasury Regulations as is determined by the Board of Governors. Any allocations made solely to comply with this Section 4.3 and the Code shall not be reflected in Capital Account adjustments.
4.4	Discretionary Distributions Prior to Liquidation. Additional current Distributions may be made from time to time as the Members holding a majority of the Units determine. Distributions pursuant to this Section 4.4 are to be made among the Members in proportion to the number of Units held by each of them. Except as provided in Section 4.7, all Distributions to Members prior to the liquidation, winding up, and dissolution of the Company shall be in cash.
4.5	Distributions Upon Dissolution and Winding Up. At the time of the dissolution and winding up of the Company, following the allocation of all net income and net losses and the payment of all Company obligations, the remaining assets shall be distributed to the Members in accordance with Section 11.3.
4.6	No Distribution by Reason of Withdrawal. Neither withdrawal from the Company, Transfer of any interest in the Company, nor demand for the return of capital shall entitle any owner of an interest in the Company to receive any Distribution from the Company.
4.7	Distributions in Kind. No Member has any right to demand or receive a Distribution from the Company in any form other than cash, nor may any Member be compelled to accept any distribution of property in kind except under circumstances where all Members receive undivided interests in property or substantially equivalent interests in property on the basis of their Capital Accounts. If there is a Distribution of property in kind, such property shall be assumed to have been sold at its fair market value at the time of the Distribution, and the resulting gain or loss shall be allocated among the Members according to their Capital Accounts, and their Capital Accounts shall be adjusted accordingly.

ARTICLE 5

MANAGEMENT

5.1	Member Voting. Members shall possess voting rights in proportion to their Units.
5.2	anagement. Except as otherwise specified herein, the management of the Company is reserved to the Members. All decisions of the Company shall be by the agreement of Members holding a majority of the Units held by Members. Notwithstanding the foregoing, the Management Board and/or Managers of the Company may make decisions

related to the management of the Company except to the extent the Members may otherwise limit such authority.

5.3	Management Board. The Company shall have a Management Board, which shall initially consist of two Managers, which number may be changed by the vote of Members holding a majority of the Units held by Members. The authority of members of the Management Board shall be subject to the provisions of Section 5.2. Members holding a majority of the Units may remove a member of the Management Board from that position. The initial members of the Management Board shall be Xx. Xxxxx X. Xxxxxx and Xx. Xxxxxxx Xxxxxx, who are hereby appointed to the Management Board by the initial Member. The “Managers” of the Company shall consist of the members of the Management Board and the other Managers elected or appointed pursuant to this Article 5. All other Managers named in this Agreement or elected or appointed pursuant to this Article 5 shall be responsible to, and subject to the authority and direction of, the Management Board in connection with matters over which the Management Board has authority. Except as otherwise provided herein, whenever this Agreement contemplates action by the Management Board, the Management Board may take or cause to be taken such action in connection with the Company’s business by the vote or agreement of a majority of the members of the Management Board.
5.4	Managers.
	(a)	The Managers of the Company, as such, shall have limited authority, and shall be subject to the provisions and limitations of this Article 5.

(b)	The Management Board may elect a Chairperson of the Board who, if elected, shall preside at all meetings of the Members and of the Management Board and shall perform such other duties as may be prescribed by the Management Board from time to time.
(c)	The Company shall have a Chief Executive Officer, who shall have general active management of the business of the Company, and in the absence of the Chairperson of the Board or if the office of Chairperson of the Board is vacant, shall preside at meetings of the members and Management Board, shall see that all orders and resolutions of the Management Board are carried into effect, shall have authority to sign and deliver in the name of the Company any deeds, mortgages, bonds, contracts, or other instruments pertaining to the business of the Company, except in cases in which the authority to sign and deliver is required by law to be exercised by another person or is expressly delegated by this Limited Liability Company Agreement, or the Management Board to some other Manager or agent of the Company, may maintain records of and certify proceedings of the Management Board and Members, and shall perform such other duties as may from time to time be prescribed by the Management Board.
(d)	The Company shall have a President, who shall be the chief operating officer of the Company, shall have authority to exercise the power of the

Chief Executive Officer in his absence, and in the absence of the Chairperson of the Board and the Chief Executive Officer, or if both such offices are vacant, shall preside at meetings of the members and Management Board. The Company may also have one or more Vice Presidents, who shall have authority to exercise the power of the President in his absence.

	(e)	The Company shall have a Treasurer, who, unless provided otherwise by the Management Board, shall keep accurate financial records for the Company, shall deposit all moneys, drafts, and checks in the name of and to the credit of the Company in such banks and depositories as the Management Board shall designate from time to time, shall endorse for deposit all notes, checks, and drafts received by the Company as ordered by the Management Board, making proper vouchers therefor, shall disburse Company funds and issue checks and drafts in the name of the Company as ordered by the Management Board, shall render to the President and the Management Board, whenever requested, an account of all such Manager’s transactions as Chief Financial Manager and of the financial condition of the Company, and shall perform such other duties as may be prescribed by the Management Board or the President from time to time..
	(f)	The Company shall have a Secretary, who shall have primary responsibility to maintain records of actions of, and whenever necessary, certify all proceedings of the Members. The Secretary shall keep the required records of the Company, when so directed by the person or persons authorized to call such meetings, shall give or cause to be given notice of meetings of the Members, and shall also perform such other duties and have such other powers as the Members or the President may prescribe from time to time.
	(g)	A Manager, as such, shall not be obligated to devote his or her full time to the conduct of the Company affairs, but shall devote only as much time as he or she deems necessary for the proper conduct thereof, and provided further, that nothing in this Agreement shall be deemed to restrict in any way the freedom of a Manager to conduct any other businesses or activities whatsoever without any accountability to the Company.
	(h)	The Company may have additional Managers as provided in Section 5.6.
5.5	Initial Managers. In addition to serving on the Management Board (a) Xx. Xxxxx X. Xxxxxx shall hold the offices of Chief Executive Officer and President, and (b) Xx. Xxxxxxx Xxxxxx shall hold the offices of Vice President, Treasurer and Secretary.

5.6	Election and Removal of Managers. Subject to the other provisions of this Article 5, the Management Board may elect or appoint other Managers or agents of the Company, with such titles, duties, and authority as they shall designate. Subject to the other provisions of

this Article 5, and to any other limitations that the Management Board may impose, the President may delegate authority and appoint other Managers and agents of the Company, with such titles, duties, and authority as the President shall designate. The President, at any time, may remove or terminate the authority of any Manager or agent that was appointed by the President. The Management Board may at any time remove or terminate the authority of any Manager or agent, whether elected or appointed by the Management Board or the President.

ARTICLE 6

LIABILITY AND INDEMNIFICATION; CONFLICTS OF INTEREST

6.1	Liability of Members. No Member shall be liable as such for the liabilities of the Company. The failure of the Company to observe any formalities or requirements relating to the exercise of its powers or management of its business or affairs under this Agreement or the Act shall not be grounds for imposing personal liability on the Members or the Managers for liabilities of the Company.
6.2	Liability of Manager and Employees. No Manager or employee shall be liable to the Company for any liability suffered by the Company on account of any action or inaction taken by him as a Manager or employee, if such Person acted (a) in good faith, (b) with the care of a corporate officer of like position, and (c) in a manner he reasonably believed to be in the best interest of the Company.
6.3	Indemnification.
	(a)	The Company shall indemnify any current or former Manager of the Company to the full extent permitted by law against expenses, judgments and other losses arising out of his or her status as Manager, provided that the Manager has met the appropriate standard of conduct as set forth in Section 6.2, in the interpretation of the current Manager, or a majority in interest of the Members if such indemnification is proposed for the current Manager.
	(b)	The Company may indemnify any current or former employee or agent of the Company, at the discretion of the Manager, to the full extent permitted by law against expenses, judgments and other losses arising out of their status as an employee, provided that the employee has met the appropriate standard of conduct as set forth in Section 6.2, in the interpretation of the Manager.
6.4	Expenses.
	(a)	The Company shall reimburse a Manager for all losses and expenses, including legal fees, in connection with any suit or action referred to in Section 6.3(a) above.

(b)	In the discretion of the Manager, the Company may advance a Manager or employee funds to defend a suit or otherwise, provided that such Person

must agree to repay such amounts if it is determined that he is not entitled to reimbursement of the funds.

6.5	Non-Exclusivity. The indemnification and advancement of expenses shall not be exclusive of any other right available to a Manager or employee.
6.6	Conflicts of Interest.
	(a)	Other Business Ventures. Any Member may engage in or possess an interest in other business ventures of every nature and description, independently or with others, whether such ventures are competitive with the Company or otherwise; and neither the Company nor the Members shall have any right by virtue of this Agreement in or to such independent ventures or to the income or profits derived therefrom, and no Member shall have the obligation to bring any business opportunity to the Company or to any other Member.
	b)	Contracts With Members and Affiliates. A Member does not violate a duty or obligation to the Company merely because the Member’s conduct furthers the Member’s own interest. A Member (or an Affiliate of a Member) may lend money to and transact other business with the Company. If a Member (or an Affiliate of a Member) lends money to or transacts business with the Company, the rights of such Member (or an Affiliate of a Member) with respect to the loan or the transacted business are the same as those of a Person who is not a Member, subject to other applicable law. No transaction with the Company shall be voidable solely because a Member has a direct or indirect interest in the transaction if either (i) the transaction is fair to the Company or (ii) the disinterested Members, knowing the material facts of the transaction and the Member’s interest, authorize, approve or ratify the transaction.

ARTICLE 7

BOOKS AND RECORDS; TAX MATTERS

7.1	Tax Characterization. The Members intend that the Company be treated as a “partnership” for tax purposes during all periods when there is more than one Person that owns an interest in the Company for federal income tax purposes, and as a nonentity for tax purposes during periods for which there is but one Person that owns an interest in the Company for federal income tax purposes.
7.2	Accounting Method and Fiscal Year. The Company will keep its accounting records and report its income for income tax purposes using such method of accounting as the Management Board shall designate. The fiscal year of the Company will end on December 31 or on such other date as the Members or Board of Governors shall designate.
7.3	Books and Records. The Company’s books and accounting records and all other papers, records, and documents relating to the Company’s affairs shall be kept at the Company’s

principal executive office or such other place as the Members may agree. Each Member shall have the right, subject to applicable law and reasonable standards established by the Management Board, to obtain from the Company from time to time upon reasonable demand for any purpose reasonably related to the Member’s interest as a Member of the Company:

(a)	true and full information regarding the status of the business and financial condition of the Company;
(b)	promptly after becoming available, a copy of the Company’s federal, state, and local income tax returns for each year;

	(c)	a current list of the name and last known business, residence or mailing address of each Member and Manager of the Company;
	(d)	a copy of any written operating agreement and Articles of Organization and all amendments thereto, together with executed copies of any written powers of attorney pursuant to which the limited liability company agreement and any certificate and all amendments thereto have been executed;
	(e)	true and full information regarding the amount of cash and description and statement of the agreed value of any other property or services contributed by each Member and which each Member has agreed to contribute in the future, and the date on which each became a Member.
7.4	Annual Financial Statements. The Management Board shall cause to be prepared and delivered to each of the Members within 120 days after the close of each fiscal year, annual financial statements for the Company, including statements of assets and liabilities, income statements, and such other statements as are commonly included in financial statements, or as may be requested by the Members. Such financial statements need not be audited. Costs of compiling the Company’s annual financial statements will be paid by the Company. If a majority in interest of the Members deems it advisable to have the Company’s financial statements audited or reviewed, the Management Board may engage an independent certified public accountant to do so, and the fees therefor will be paid by the Company.
7.5	Bank Accounts. The Management Board shall select a bank account or accounts for the funds of the Company, and all funds of every kind and nature received by the Company shall be deposited in such account or accounts. The Management Board shall designate from time to time the Persons authorized to withdraw funds from such accounts. The funds of the Company will not be commingled with funds of any other Person.
7.6	Tax Returns. As soon as possible following the close of each year of the Company for which the filing of a partnership tax return is required, the partnership income tax return for the Company shall be prepared by such accountant or firm as may be selected by the Management Board. In addition, within 75 days after the end of each fiscal year, the Company will cause to be delivered to each Person who was a Member at any time

during such fiscal year a Schedule K-1 and such other information, if any, with respect to the Company as may be necessary for the preparation of such Member’s federal or state income tax (or information) returns, including a statement showing each Member’s share of income, gain, loss, and credits for such fiscal year for federal or state income tax purposes.

7.7	Tax Elections. In the sole discretion of the Management Board, the Company may make or not make any and all tax elections deemed appropriate, including, in the event of a transfer of all or part of any Member’s interest in the Company, the election under Section 754 of the Code to adjust the bases of the assets of the Company.
7.8	Tax Matters Partner. During periods for which the Company must have a “tax matters partner” within the meaning of Section 6231(a)(7) of the Code, Xx. Xxxxx X. Xxxxxx shall act as the tax matters partner of the Company.

ARTICLE 8

TRANSFERS OF MEMBERSHIP INTERESTS

8.1	Limitation on Sale or Exchange. Except as otherwise provided in this Article 8, no Member may sell, assign, or otherwise transfer all or any portion of his interest in the Company except as agreed by all other Members.
8.2	Requirements for Assignment. Subject to restrictions on transferability contained elsewhere in this Agreement or imposed by federal or state law, a Member may assign an interest in the Company only of the following requirements are met: (a) the Member delivers a written assignment to the Company that (i) is not in contravention of any of the provisions of this Agreement, (ii) has been duly executed and acknowledged by the assignor and Assignee, subject to the reasonable approval of the Management Board, and (iii) is to an Assignee who represents that he satisfies specific suitability standards applicable to the assigning Member as may from time to time be established by a majority in interest of the Members; and (b) if required by the Management Board, legal counsel for the Company has rendered its opinion, in form and substance satisfactory to the Management Board and at the expense of the prospective Assignee or assignor, that such assignment would not cause the termination of the Company for federal income tax purposes (unless termination is consented to by the Management Board or the transfer is otherwise permitted by Section 8.1) or the taxation of the Company as a corporation.
8.3	Continuation of Assignor’s Status. Anything herein to the contrary notwithstanding, the Company, its Managers, and the Members are entitled to treat an assignor of an interest in the Company as the absolute owner thereof in all respects, and they will incur no liability for distributions of cash made in good faith to him until such time as a written assignment that conforms to all requirements of this Article 8 has been received by and recorded on the books and records of the Company. Until such time any payment by the Company to an assigning Member or his executors, administrators, or representatives shall acquit the Company of liability to the extent of such payments to any other person who may have an interest in such payment by reason of an assignment by the Member, such Member’s death, or otherwise.

8.4	Assignee’s Rights. An Assignee of any Member’s interest will be entitled to receive Distributions of cash or other property from the Company and to receive allocations of the gains, profits, and losses of the Company attributable to such interest after the effective date of the assignment. The “effective date” of an assignment shall be the later of (a) the date set forth on the written instrument of assignment and (b) the date upon which the requirements of this Article 8 have been satisfied. An Assignee who has not been admitted as a Substitute Member pursuant to Section 8.5 will have no additional rights except as required by law.
8.5	Requirements for Admission as a Substitute or Additional Member. An Assignee of an interest in the Company, if not already a Member, may become a Substitute Member only with the consent of Members holding a majority of all Units held by nontransferring Members, which consent may be granted or withheld all in each such Member’s sole discretion. No Assignee of any Member’s interest who is not already a Member may become a Substitute Member with respect to such interest without such consent.
8.6	Documents and Expenses. As a condition to admission as a Substitute Member, an Assignee of all or a part of any interest in the Company shall execute and acknowledge such instruments, in form and substance satisfactory to the Company, as the Company deems necessary or advisable to effectuate such admission and to confirm the agreement of the person being admitted as such Substitute Member to be bound by all of the terms and provisions of this Agreement. Such Assignee shall pay all reasonable expenses in connection with such admission as a Substitute Member, including, but not limited to, legal fees and costs of preparing and filing any amendment to the Articles of Organization of the Company if necessary or desirable in connection therewith.
8.7	Transfers Not in Compliance With this Article are Void. Any attempted transfer of an interest in the Company, or any part thereof, not in compliance with this Article 8 is null and void ab initio.
8.8	Acquit Company. Until such time as a written assignment that conforms to all requirements of this Article 8 has been received by and recorded on the books of the Company, any payment by the Company to an assigning Member or his executors, administrators, or representatives shall acquit the Company of liability to the extent of such payments from any other Person who may have an interest in such payment by reason of an assignment by the Member, such Member’s death, or otherwise.
8.9	Obligations of Substitute Members or Assignees. A Person who shall, as provided in this Article, be admitted as a Member of the Company, or shall become an Assignee of an interest in the Company or other rights or powers of a Member to the extent assigned, shall become bound by this Agreement:
	(a)	If such Person (or a representative authorized by such Person orally, in writing or by other action such as payment for an interest in the Company) executes the Agreement or any other writing evidencing the intent of such Person to become a Member or Assignee; or

(b)

Without such execution, if such Person (or a representative authorized by such Person orally, in writing or by other action such as payment for an interest in the Company) complies with the conditions for becoming a Member or Assignee as set forth in this Agreement or any other writing and requests (orally, in writing or by other action such as payment for a Company interest) that the records of the Company reflect such admission or assignment; and

(c)

Such obligation shall not be unenforceable by reason of its not having been signed by a Person being admitted as a Member or becoming an Assignee as provided in this Article, or by reason of its having been signed by a representative as provided by the Act.

ARTICLE 9

ADDITIONAL MEMBERS

Additional Members may be admitted to the Company upon such terms and conditions, and for such Capital Contributions as shall be approved by all Members.

ARTICLE 10

RESIGNATION; WITHDRAWAL

A Member may not resign from, withdraw from, or assign an interest in the Company, except as specifically permitted by this Agreement.

RTICLE 11

DISSOLUTION; CONTINUATION

11.1	Dissolution Events. The Company shall continue until the occurrence of any of the following events (each a “Dissolution Event”):
	(a)	The expiration of the Company’s period of existence, as set forth in the Articles of Organization;
	(b)	The written consent of all of the Members to dissolve and terminate the Company;
	(c)	The death, retirement, resignation, expulsion, bankruptcy, or dissolution of a Member, or the occurrence of any other event which terminates the continued membership of a Member if there is no remaining Member after such event; or
	(d)	The decree of a court of competent jurisdiction that dissolution and liquidation is required.

11.2

Continuation After Dissolution. Upon the occurrence of a Dissolution Event defined in Section 11.1(c), the Company automatically shall be continued if one or more additional Members are admitted pursuant to Article 9 within 90 days after such Dissolution Event.

11.3

Dissolution Procedure. Except as otherwise provided by the Act and unless the Company is continued pursuant to Section 11.2, upon the occurrence of a Dissolution Event, no further business shall be done in the name of or on behalf of the Company except insofar as may be necessary to wind up the business of the Company and distribute its assets to the Members or their successors in interest, and the Company shall execute and file a certificate of cancellation as required by the Act. Upon dissolution and termination of the Company, except as otherwise provided in any valid business continuation agreement and by applicable law, the Company’s assets shall be applied in the following order:

(a)	To creditors, including Members or the Manager who are creditors, to the extent otherwise permitted by law, in satisfaction of liabilities of the Company (whether by payment or the making of reasonable provision for payment thereof) other than (i) liabilities for which reasonable provision for payment has been made; and (ii) liabilities for Distributions to Members pursuant to Section 4.5 of this Agreement;
(b)	Next, to the setting up of any reserves deemed reasonably necessary by the Manager for (i) any contingent, conditional or unmatured claims or obligations of the Company known to the Company, and (ii) all claims and obligations which are known to the Company but for which the identity of the claimant is unknown;
(c)	Next, to the Members who are creditors for any debts and liabilities not permitted to be paid under (a) above; and
(d)	Next, to the Members first in accordance with their respective Capital Account balances, and second respecting their interests in the Company, in the proportions in which Members share in Distributions pursuant to Section 4.3 of this Agreement.

For purpose of determining the rights of Members to Distributions in dissolution, in the event of a distribution of property in kind, such property shall be assumed to have been sold at its fair market value, as determined by the Manager, with any gain or loss allocated to the Members in accordance with Article 4. If a Member is indebted to the Company, the Company shall, if possible, offset such indebtedness to satisfy its obligation to make a Distribution in dissolution to said indebted Member rather than distribute a portion of said indebtedness to the other Members.

ARTICLE 12

AMENDMENTS

No change, modification or amendment of this Agreement shall be valid or binding unless such change, modification or amendment is contained in a writing signed by all Members.

ARTICLE 13

MISCELLANEOUS

13.1	Governing Law. Notwithstanding the fact that the Company will conduct business in states other than Nevada, and notwithstanding the fact that the Members are residents of states other than Nevada, this Agreement and the rights of the parties hereunder will be governed by, interpreted, and enforced in accordance with the laws of the State of Nevada.
13.2	Articles of Organization. The Articles of Organization are incorporated by reference and hereby made a part of this Agreement. In the event of any conflict between the Articles of Organization and this Agreement, the provisions of this Agreement shall govern to the extent not contrary to law.
13.3	Binding Effect. This Agreement will be binding upon and inure to the benefit of the Members, and their respective heirs, executors, administrators, personal representatives, successors and assigns.
13.4	Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable under the present or future laws effective during the term of this Agreement, such provision will be fully severable, and this Agreement will be construed and enforced as if such illegal, invalid, or unenforceable provision had never comprised a part of this Agreement, and the remaining provisions of this Agreement will remain in full force and effect and will not be affected by the illegal, invalid or unenforceable provision or by its severance from this Agreement. Furthermore, in lieu of such illegal, invalid or unenforceable provision, there will be added automatically as a part of this Agreement a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable.
13.5	Counterparts. This Agreement may be executed in several counterparts, each of which will be deemed an original, but all of which will constitute one and the same instrument. In making proof hereof it will be necessary to produce only one copy hereof signed by the party to be charged.
13.6	Additional Documents and Acts. Each Member agrees to execute and deliver such additional documents and instruments and to perform such additional acts as may be necessary or appropriate to effectuate, carry out and perform all of the terms, provisions and conditions of this Agreement and the transactions contemplated hereby.
13.7	No Third Party Beneficiary. This Agreement is made solely and specifically among and for the benefit of the parties hereto, and their respective successors and assigns, and no other Person will have any rights, interest or claim hereunder or be entitled to any benefits under or on account of this Agreement, whether as a third party beneficiary or otherwise.
13.8	Notices. Any notice to be given or to be served by a Member upon the Company in connection with this Agreement must be in writing and will be deemed to have been given when delivered personally or mailed to the Company at its registered office or its

principal executive office or to the Company’s President. Notice to a Member will be deemed to have been given when (a) delivered personally to the Member or (b) deposited in the United States mail, postage prepaid and addressed to a Member at the address specified in Section 2.2 hereof. At any time, by giving 5 days’ prior written notice to the Company, a Member may designate another address in substitution of the foregoing address as the address to which notice is to be given.

13.9	Headings and Titles. Article and section headings and titles are for descriptive purposes and convenience of reference only and shall not control, alter or be used to interpret the meaning of this Agreement as set forth in the text.
13.10	Entire Agreement. This Agreement is the final integration of the agreement of the parties with respect to the matters covered by it and supersedes any prior understanding or agreement, oral or written, with respect thereto.
13.11	Gender, Etc. Except where the context requires otherwise, the use of terminology of any of the masculine, feminine or neuter genders shall include all such genders, and the use of the singular number shall include the plural and vice versa.

[REMAINDER OF THIS PAGE BLANK. SIGNATURE PAGE FOLLOWS.]

The Members have executed this Agreement to be made effective as of the date first above written.

MEMBER:

MELT INC., A NEVADA CORPORATION

/s/ Xxxxx X. Xxxxxx

Name:	Xxxxx X. Xxxxxx
Title:	President

[SIGNATURE PAGE TO MELT FRANCHISING, LLC OPERATING AGREEMENT]

SCHEDULE A

CAPITAL CONTRIBUTIONS

Member	Capital Contributions	Number of Units
Melt Inc.	$100		1,000

TOTAL	$100		1,000

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OPERATING AGREEMENT OF MELT FRANCHISING, LLC

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