sns-network-solutions/businesses/01-networking/docs/operating-agreement.md

# Operating Agreement for SNS Infrastructure LLC

> **Draft / template — not legal advice.** This is a working draft for a single-member
> Indiana LLC that is a **subsidiary** of SnS Network Solutions Holdings LLC. Have an
> Indiana-licensed attorney review and finalize it before signing. Items in `[brackets]`
> need your specific information; items marked `[TODO — attorney review]` should be
> confirmed with counsel.

**Entity:** SNS Infrastructure LLC (the "Company")
**Parent / sole member:** SnS Network Solutions Holdings LLC (the "Parent Company")
**State of formation:** Indiana
**Effective date:** `[Effective Date — the date this Agreement is adopted]`

---

## 1. Formation and Purpose

This Operating Agreement (the "Agreement") is entered into by the sole Member, **SnS
Network Solutions Holdings LLC** (the "Parent Company"), to govern the operations of
**SNS Infrastructure LLC**, a limited liability company organized under the Indiana
Business Flexibility Act (Indiana Code § 23-18).

The Company is an **operating subsidiary** formed to provide low-voltage structured
cabling, networking, wireless, and related IT-infrastructure services to clients.
Unlike the Parent Company, the Company **does** conduct client-facing work and therefore
carries the operating liability associated with that work — which is precisely why it is
held in a separate LLC, so that liability is walled off from the Parent Company and from
the other subsidiaries.

## 2. Registered Office and Registered Agent

- **Principal office:** `[Principal business address — e.g., South Bend, IN]`
- **Registered agent:** `[Registered agent name]`
- **Registered office address:** `[Indiana street address of the registered agent]`

## 3. Member and Ownership

The sole Member of the Company is **SnS Network Solutions Holdings LLC**, which holds
**100%** of the membership interest. This sole-member ownership by the Parent Company is
what makes the Company a subsidiary within the holding-company structure.

## 4. Management

The Company shall be **Member-managed** by the Parent Company. The Parent Company acts
through its authorized representative, **Samuel S. James** (its sole member/manager), who
has authority to make all decisions regarding the Company's business, including:

- Entering into client contracts and performing infrastructure services;
- Hiring and directing employees and subcontractors;
- Opening and controlling the Company's bank and financial accounts;
- Procuring insurance and equipment for the Company's operations.

## 5. Separateness (Preserving the Liability Shield)

Because this is the operating entity that carries client-facing risk, the following
separateness practices are essential to protect the Parent Company and the other
subsidiaries:

- Keep the Company's funds, accounts, and records **strictly separate** from the Parent
  Company's and from any sibling subsidiary (no commingling);
- Contract with clients, vendors, and subcontractors **in the Company's own name** (SNS
  Infrastructure LLC), not the Parent's name;
- Maintain the Company's **own insurance** appropriate to low-voltage/on-site work
  (general liability and workers' compensation) — `[TODO — bind coverage before field work]`;
- Observe ordinary business formalities and adequate capitalization.

## 6. Capital Contributions and Distributions

- **Capital contributions:** The Parent Company may contribute capital to the Company as
  needed; contributions are recorded in the Company's books.
- **Distributions:** Distributions of available profits are made **to the Parent
  Company** at the times and amounts it determines, subject to the Company's financial
  obligations and applicable law. The Company may not make a distribution that would
  render it unable to pay its debts as they come due.

## 7. Bank Accounts, Books, and Records

- The Company shall maintain **its own bank account(s)**, separate from the Parent
  Company's and from every sibling subsidiary's accounts.
- The Company shall keep accurate books and records of its finances, contracts, and
  material decisions, retained at the principal office as required by Indiana law.

## 8. Tax Treatment

The Company is a single-member LLC wholly owned by the Parent Company. By default it is
treated as a **disregarded entity** for U.S. federal income tax purposes; its income and
expenses flow up to its sole member (the Parent Company), which is itself a disregarded
entity flowing to its individual member. `[TODO — confirm tax treatment and any elections
with a CPA/attorney.]`

- **EIN:** `[Company EIN — obtain from the IRS]`
- **Fiscal year:** `[Fiscal year — typically the calendar year]`

## 9. Liability and Indemnification

To the fullest extent permitted by Indiana law:

- The Parent Company, as member, shall **not be liable** for the debts, obligations, or
  liabilities of the Company solely by reason of being its member; and
- The Company shall **indemnify and hold harmless** the Parent Company (and any
  authorized manager, representative, or agent) against claims, losses, and expenses
  arising from the good-faith management of the Company, except for acts of fraud,
  willful misconduct, or bad faith.

## 10. Continuity and Transfer of Membership Interest

- **Continuity:** The Company shall **not dissolve** solely because of a change affecting
  the Parent Company's internal ownership; the membership interest remains held by the
  Parent Company (or its successor) as provided in the Parent Company's operating
  agreement and estate plan.
- **Transfer:** The Parent Company may assign or transfer the membership interest at its
  discretion. Admission of any new member with management rights requires amendment of
  this Agreement under §11.

## 11. Amendments

This Agreement may be amended only by a **written instrument signed by the Member** (the
Parent Company, acting through its authorized representative). Amendments are effective on
the date stated in the amendment.

## 12. Dissolution

The Company shall continue in perpetuity unless dissolved by the written election of the
Parent Company or by operation of Indiana law. Upon dissolution, the Company's assets
shall be applied first to creditors, then to the Parent Company, after which Articles of
Dissolution shall be filed with the Indiana Secretary of State.

## 13. Governing Law and Severability

This Agreement is governed by and construed in accordance with the laws of the **State of
Indiana**. If any provision is held invalid or unenforceable, the remaining provisions
remain in full force and effect.

## 14. Definitions

- **"Company"** — SNS Infrastructure LLC.
- **"Parent Company" / "Member"** — SnS Network Solutions Holdings LLC, and any successor.
- **"Membership Interest"** — the Parent Company's ownership, economic, and management
  rights in the Company.

---

## Execution

The Parent Company, being the sole Member of SNS Infrastructure LLC, adopts and agrees to
this Operating Agreement as of the Effective Date first written above.

**SOLE MEMBER — SnS Network Solutions Holdings LLC**

By: ______________________________________

Name: **Samuel S. James**

Title: Authorized Representative / Sole Member of the Parent Company

Date: ______________________________________

<br>

*Prepared as a working draft. Review with an Indiana-licensed attorney before signing.*