Attachment 19 - Operating agreement for Los Gatos Senior HomesOPERATING AGREEMENT
FOR
LOS GATOS SENIOR HOMES LLC
The undersigned, the sole member of the company, does hereby enter into this contract
and operating agreement for operation of the above named limited liability company, hereinafter
referred to as the "Company."
Contract and Intent of the Parties
This operating agreement ( "Agreement') is a contract between its parties (the member
and the Company) and is enforceable against any party who violates its terms. All members
must sign this operating agreement as a condition precedent of membership.
It is the specific intent of the parties to this Agreement to form a limited liability
company that is to be treated as a disregarded entity until additional members, if any, gain
membership and then the intent is that the entity be classified as a partnership for federal income
tax purposes.
II
Members
Each member of this Company shall be a "Qualified Organization" which shall mean
an organization that is exempt under Section 501(c)(3) of the Internal Revenue Code or
under Section 23701(d )of the California Revenue and Taxation Code and that qualifies for
exemption under Section 214 of the California Revenue and Taxation Code. Each "Qualifying
Organization" shall have a valid, unrevoked letter from the Internal Revenue Service or the
Franchise Tax Board, stating that it qualifies as an exempt organization under section 501(3) of
the Internal Revenue Code or under section 23701(d) of the California Revenue and Taxation
Code.
Each member is prohibited from transferring, directly or indirectly, its member interest to
any person or entity which is not a Qualified Organization.
III
Office
The principal office of the Company in California is located at 1400 Parlanoor Avenue,
Suite 190, San Jose, CA 95126. The Company may have such other offices, either within or
without the state as the members may designate or as the business of the Company may require.
The registered office of the Company as required by the Act to be maintained in the State of
California may be, but need not be, identical with the principal office, if within the State of
California, and may be changed from time to time by the members.
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Los Gatos Scrior Hame, LLC
ATTACHMENT 1 9
IV
Purpose
The Company is formed for the purpose of operating exclusively for one or more exempt
purposes as specified in section 214 of the California Revenue and Taxation Code pursuant to
the provisions of the California Revised Limited Liability Company Act, Corporations Code
17701.01 — 17713.13, as the same may be amended from time to time (the "Act") upon the terms
and conditions contained in this Agreement. The rights and obligations of the members are as
provided in the Act, except as provided herein.
The Company is organized and operated exclusively to further the following specific
charitable purposes of its members: (1) to provide housing for low income persons, where
no adequate housing exists for such groups; and (2) to serve as a general partner in a limited
partnership which owns and operates housing for the benefit of low income persons who are in
need of affordable, decent, safe and sanitary housing and related services.
V
Duration of the Company
The Company shall commence on the date of the filing of the articles of organization
with the Office of the California Secretary of State and shall exist in perpetuity unless otherwise
dissolved pursuant to the terms of this Agreement.
VI
Limitation of Company Activities
Notwithstanding any other provision of this Agreement, the Company is organized
and operated exclusively to further exempt purposes as specified in Section 214 of the
California Revenue and Taxation Code. Any amendments to this Agreement and the articles
of organization shall be consistent with the exempt purposes as specified in Section 214 of the
California Revenue and Taxation Code.
VII
Dedication of Property
All real and personal property owned by the Company shall be owned by and in the name
of the Company and is irrevocably dedicated to one or more exempt purposes as set forth in
Sections 214 or 214.01 of the California Revenue and Taxation Code. No member shall have
any ownership interest in such property in its individual name or right. Each member's interest
in the Company shall be personal property.
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Los r0os S,.m Homes LLC
VIII
Allocation of Profits and Losses
The sole member has a 100% interest in capital, profits and losses. With only one
member, the entity does not have standing for federal partnership tax treatment, but rather
is treated as a disregarded entity. Therefore, the sole member treats the profits and losses
for federal income tax purposes on the member's tax returns. Notwithstanding anything to
the contrary, no distribution shall be made to any member which ceases to be a Qualified
Organization.
IX
Capital Contributions
The Company shall have a single member, Charities Housing Development Corporation
of Santa Clara County, a California nonprofit public benefit corporation and Qualified
Organization, which shall own 100% of the beneficial interest in the business and Company and
shall make such capital contributions as it determines.
X
Rights and Duties of the Parties
This entity is to be managed by the sole member.
XI
Costs and Expenses
The member shall determine the compensation and expenses payable by the Company.
The member may act in any capacity and serve with or without compensation.
XII
Indemnification
The member may indemnify any member, manager, employee or agent against expenses
(including attorney's fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by him/her in connection with action, suit or proceeding, if the member
determines that it acted in good faith in a manner reasonably believed to be in the best interest
of the Company. The termination of any action, suit, or proceeding by judgment, order,
settlement, conviction, or on a plea of nolo contendere or its equivalent, will not in itself create
a presumption that the person did or did not act in good faith and in a manner which he/she
reasonably believed to be in the best interest of the Company and, with respect to any criminal
action or proceeding, had reasonable cause to believe that his conduct was unlawful.
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Los GM. Si., Homee UC
MII
Banking
All funds of the Company shall be deposited in its name in such checking account or
accounts as shall be designated by the member. All withdrawals therefrom are to be made upon
written bank instruments which must be signed by member.
XIV
Books
The Company books shall be maintained at the Company offices located at 1400
Parkmoor Avenue, Suite 190, San Jose, CA 95126, to be retained by the entity. The books shall
be kept on a calendar year basis, and shall be closed and balanced at the end of each tax year.
The Company hereby covenants and agrees to cause all known business transactions pertaining
to the purpose of the Company, to be entered properly and completely into the books. The
Company is to furnish copies of annual financial statements to the member to enable it to prepare
its annual tax returns in a timely manner.
XV
Insurance
During the course of the term for which this Company is formed, the Company shall
carry liability insurance in such amounts as are deemed appropriate by the member.
XVI
Voluntary Termination
If the Company is dissolved the member shall proceed with reasonable promptness to
liquidate the Company. The assets of the Company shall be distributed in the following order:
A. To pay or provide for the payment of all Company liabilities to creditors other than
members, and liquidating expenses and obligations; and
B. To an entity organized and operated exclusively for exempt purposes, as specified in
Section 214 of the California Revenue and Taxation Code, and which has established tax - exempt
status under Section 501(c)(3) of the Internal Revenue Code, or under Section 23701(d) of the
California Revenue and Taxation Code.
XVII
Distributions
Prior to dissolution and at least annually as income is received by the Company, its
accounts determined and tax returns filed, the member shall determine funds available for
distribution. Upon liquidation, a reasonable reserve as determined by the member in amount
shall be established to cover follow -on or subsequent complaint and warranty construction
requirements, if any. Liquidation of the Company need not be delayed provided that such
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Los Gmos Seni. Homo LLC
amounts are properly escrowed and arrangement made for performance of such services as may
be required in the interest of the Company. Escrows, reserves or liquidating accounts may be
established as escrows or otherwise, which activity need not unduly delay the termination of the
Company for all other purposes.
XVIII
Foreign Qualification
Management shall not permit the Company to engage in any business outside the State of
California unless and until the Company has complied with the requirements necessary to qualify
the Company as a foreign limited liability company in the jurisdiction in which the Company
shall conduct business.
XIX
Merger
Management shall not permit the Company to merge or combine with, or convert into an
entity organized for the private gain of any person.
504,W5 Operating Agreement
Lm Oame Senior Tim. LLC
IN WITNESS WHEREOF, the sole member has executed this operating agreement
effective as of J UL`i I to , 2014.
Charities Housing Development Corporation
of Santa Clara County,
a California nonprofit li benefit corporation
By.
Name: DAN 1 FL. W L)
Its: FX l UT1 V F_ PIP-64-fop-
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Los Gmos Senior Homes LLC