I need the solutions of the following problematic questions:

Refer to the APS LLC agreement and answer the following questions. Make sure to note any applicable LLC agreement and/or statutory provision that supports the answer. Assume that Watson did not sell his units.

1. APS earned $200,000 for its latest fiscal year. How are these profits allocated among the members?
2. How much of this $200,000 is APS required to distribute to the members?
3. APS decides to distribute $100,000 to its members. How much of this amount does each member get?
4. How much does APS owe in federal income tax on the $200,000?

Here is APS LLC agreement:

LIMITED LIABILITY COMPANY AGREEMENT

This Limited Liability Company Agreement (this "Agreement") of AAA Pool Services, LLC, a Delaware limited liability company (the "Company"), is entered into as of March 9, 2014, by and among the Company and the Persons named on Schedule 1 of this Agreement (collectively, the "Members"). Unless otherwise noted or defined elsewhere in this Agreement, capitalized terms used in this Agreement have the meanings ascribed herein, as more fully set forth in Article X.

ARTICLE I

Organizational Matters

Section 1.01 Name.The name of the Company is AAA Pool Services, LLC.

Section 1.02 Principal Office.The principal office of the Company is located at 2013 Ajo Way, Tucson, Arizona, 85716, or such other location as may from time to time be determined by the Manager. The Manager shall give prompt notice of any such change to each of the Members.

Section 1.03 Registered Office; Registered Agent.The registered office of the Company and the registered agent for service of process on the Company in the State of Delaware shall be that office and Person named in the Certificate of Formation or such other office (which need not be a place of business of the Company) or such other Person or Persons as the Manager may designate from time to time in the manner provided by the

Delaware Act and Applicable Law.

Section 1.04 Purpose; Powers.

1. The purposes of the Company are to engage in any lawful act or activity for which limited liability companies may be formed under the Delaware Act and to engage in any and all activities necessary orincidental thereto.

1. The Company shall have all the powers necessary or convenient to carry out the purposes for which it isformed, including the powers granted by the DelawareAct.

Section 1.05 Term.The term of the Company commenced on the date and time the Certificate of Formation was filed with the Secretary of State of the State of Delaware and shall continue in existence perpetually or until any earlier date when the Company is terminated in accordance with the provisions of this Agreement or as provided by law.

ARTICLE II Member

Section 2.01 Members.The names and Membership Interests of the Members are set out in Schedule 1 attached hereto (the "Members Schedule"). The Manager shall maintain and update the Members Schedule upon the issuance or Transfer of any Membership Interests to any new or existing Member in accordance with this Agreement. No Member shall owe the Company or other Members any fiduciary duties solely because that person is a Member.

Section 2.02 Capital Contributions; Capital Accounts; No Withdrawals.

1. The Members have contributed to the Company the amounts, in the form of cash, property, services, or apromissory note or other obligation (as such amounts may be amended herein from time to time, the

"Capital Contributions") set out in the Members Schedule. No Member is required to make additional Capital Contributions to the Company.

1. The Company shall establish and maintain for each Member a separate capital account (a "Capital

Account") on its books and records in accordance with the provisions of Section 704(b) of the Code and Treasury Regulations Section 1.704-1(b)(2)(iv). Each Capital Account shall be (i) credited by such

Member's Capital Contributions to the Company and any profits allocated to such Member in accordance

with Section 4.01 and (ii) debited by any distributions to such Member pursuant to Section 5.01(a) and anylosses allocated to such Member in accordance with Section 4.01. For purposes of maintaining the

Members' Capital Accounts, profits and losses shall be determined in accordance with Treasury Regulation Section 1.704-1(b). The Capital Accounts shall be adjusted by the Manager upon the occurrence of an event described in Treasury Regulations Section 1.704-1(b)(2)(iv)(f)(5) in the manner described in Treasury Regulations Section 1.704-1(b)(2)(iv)(f)(5) and (g) if the Manager determines that such adjustments are necessary or appropriate to reflect the relative economic interests of the Members. In the event of a

Transfer of any Membership Interest in accordance with the terms of this Agreement, the Transferee shall succeed to the Capital Account of the Transferor to the extent it relates to the transferred Membership Interest.

1. No Member shall be entitled to withdraw any part of its Capital Account or to receive any distribution fromthe Company, except as otherwise provided in thisAgreement.

Section 2.03 Admission of Additional Members.

1. Additional Members may be admitted from time to time in connection with (i) the issuance of Membership Interests by the Company, subject to compliance with the provisions of Section 3.02(b), p. 261or (ii)a

Transfer of Membership Interests, subject to compliance with the provisions of Article VI, and in either case,following compliance with the provisions of Section 2.03(b).

1. In order for any Person not already a Member of the Company to be admitted as a Member, whether pursuant to an issuance or a Transfer (including a Permitted Transfer) of Membership Interests,suchPerson shall have executed this Agreement. Upon the amendment of the Members Schedule bythe

Manager and the satisfaction of any other applicable conditions, including, if a condition, the receipt by the Company of payment for the issuance of the applicable Membership Interests, such Person shall be admitted as a Member, shall be a party hereto, shall be deemed listed as such on the books and records of the Company, and thereupon shall be issued his, her, or its Membership Interests. The Manager shall also adjust the Capital Accounts of the Members as necessary in accordance with Section 2.02.

Section 2.04 No Withdrawal; Death of Member.

1. So long as a Member continues to hold any Membership Interest, such Member shall not have the ability towithdraw as a Member prior to the dissolution and winding up of the Company and any such withdrawal or attempted withdrawal by a Member prior to the dissolution and winding up of the Company shall be null and void. As soon as any Member ceases to hold any Membership Interests, such Person shall no longer be aMember.

1. The death of any Member shall not cause the dissolution of the Company. In such event, the Company andits business shall be continued by the remaining Member or Members and the Membership Interests

owned by the deceased Member shall be automatically Transferred to such Member's executors, administrators, testamentary trustees, legatees, distributees, or beneficiaries, as applicable, as Permitted Transferees; provided, that any such Permitted Transferee shall be admitted as a Member only upon compliance with the provisions of Section 2.03(b).

Section 2.05 Certification of Membership Interests.

1. The Company may,but shall not be required to, issue certificates evidencing Membership Interests in theCompany.

1. If the Manager shall issue certificates representing Membership Interests in accordance with Section 2.05(a), then in addition to any other legend required by Applicable Law, all certificates representing issued and outstanding Membership Interests shall bear a legend substantially in the following form:

THE MEMBERSHIP INTERESTS REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A LIMITED LIABILITY COMPANY AGREEMENT AMONG THE COMPANY AND ITS MEMBERS, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICE OF THE COMPANY. NO TRANSFER, SALE, ASSIGNMENT, GIFT, PLEDGE, p. 262ENCUMBRANCE, HYPOTHECATION, OR OTHER DISPOSITION OF THE MEMBERSHIP INTERESTS REPRESENTED BY THIS CERTIFICATE MAY BE MADE EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF SUCH LIMITED LIABILITY COMPANY AGREEMENT.

THE MEMBERSHIP INTERESTS REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN

REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR UNDER ANY OTHER APPLICABLE SECURITIES LAWS AND MAY NOT BE TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED, OR OTHERWISE DISPOSED EXCEPT PURSUANT TO (A) A REGISTRATION

STATEMENT EFFECTIVE UNDER SUCH ACT AND LAWS, OR (B) AN EXEMPTION FROM REGISTRATION THEREUNDER.

Section 2.06 Meetings.

1. Meetings of the Members may be called by (i) the Manager or (ii) a Member or group of Members holdingmore than 50% of the Membership Interests.

1. Written notice stating the place, date, and time of the meeting and, in the case of a meeting of the Members not regularly scheduled, describing the purposes for which the meeting is called, shall be delivered not fewer than 10 days and not more than 30 days before the date of the meeting toeach

Member, by or at the direction of the Manager or the Member(s) calling the meeting, as the case may be. The Members may hold meetings at the Company's principal office or at such other place, as the Manager or the Member(s) calling the meeting may designate in the notice for such meeting.

1. Any Member may participate in a meeting of the Members by means of conference telephone or other communications equipment by means of which all Persons participating in the meeting hear each other,and participation in a meeting by such means shall constitute presence in person at such meeting.

1. On any matter that is to be voted on by the Members, a Member may vote in person or by proxy,and suchproxy may be granted in writing, by means of Electronic Transmission, or as otherwise permitted by Applicable Law.Every proxy shall be revocable in the discretion of the Member executing it unless otherwise provided in such proxy; provided, that such right to revocation shall not invalidate or otherwise affect actions taken under such proxy prior to suchrevocation.

1. The business to be conducted at such meeting need not be limited to the purpose described in the notice and can include other business to be conducted by the Members; provided, that the Members shall have been notified of the meeting in accordance with Section 2.06(b). Attendance of a Member at any meeting shall constitute a waiver of notice of such meeting, except where a Member attends a meeting for the express purpose of objecting to the transaction of any business claiming the meeting is not lawfully called or convened.

1. p. 263A quorum of any meeting of the Members shall require the presence, whether in person or by proxy,of the Members holding a majority of the Membership Interests. Subject to Section 2.07, no action may be taken by the Members unless the appropriate quorum is present at a meeting.
2. Subject to Section 2.07, Section 3.02, Section 11.09,and any other provision of this Agreement or theDelaware Act requiring the vote, consent, or approval of a different percentage of theMembership

Interests, no action may be taken by the Members at any meeting at which a quorum is present without the affirmative vote of the Members holding a majority of the Membership Interests.

Section 2.07 Action Without Meeting.Notwithstanding the provisions of Section 2.06, any matter that is to bevoted on, consented to, or approved by Members may be taken without a meeting, without prior notice, and

without a vote if consented to, in writing or by Electronic Transmission, by a Member or Members holding not lessthan the minimum number of votes that would be necessary to authorize or take such action at a meeting at

which each Member entitled to vote on the action is present and votes. A record shall be maintained by the Manager of each such action taken by written consent of a Member or Members.

ARTICLE III

Management

Section 3.01 Management of the Company.Subject to the provisions of Section 3.02 and except as otherwise provided by the Delaware Act, the business, property, and affairs of the Company shall be managed by the

Manager. The actions of the Manager taken in accordance with the provisions of this Agreement shall bind the Company. No other Member of the Company shall have any authority or right to act on behalf of or bind the

Company, unless otherwise provided herein or unless specifically authorized by the Manager pursuant to a duly adopted resolution expressly authorizing such action. The Manager shall owe the Company the duty of loyalty.

Section 3.02 Actions Requiring Approval of Members.Without the written approval of Members holding a majority of the Membership Interests, the Company shall not, and shall not enter into any commitment to:

1. Amend, modify,or waive any provisions of the Certificate of Formation or this Agreement; providedthat the Manager may,without the consent of the other Members, amend the Members Schedule following any newissuance, redemption, repurchase, or Transfer of Membership Interests in accordance with thisAgreement.

1. p. 264Issue additional Membership Interests, Equity Securities, or other securities or,except in connection with a Transfer of Membership Interests that complies with the applicable provisions of Article VIand

Section 2.03(b), admit additional Members to the Company.

1. Incur any indebtedness, pledge or grant Liens on any assets, or guarantee, assume, endorse, or otherwise become responsible for the obligations of any other Person, in each case in excess of $25,000 in a single transaction or series of related transactions.

1. Make any loan or advance to, or a Capital Contribution or investment in, any Person, in excess of $10,000.
2. Enter into or effect any transaction or series of related transactions involving the purchase, lease, license,exchange, or other acquisition (including by merger, consolidation, sale of stock, or acquisition of assets) by the Company of any assets and/or equity interests, other than in the ordinary course of business consistent with past practice.
3. Enter into or effect any transaction or series of related transactions involving the sale, lease, license, exchange, or other disposition (including by merger, consolidation, sale of stock, or sale of assets) by theCompany of any assets and/or equity interests, other than sales of inventory in the ordinary course of business consistent with past practice.
4. Dissolve, wind up, or liquidate the Company or initiate a bankruptcy proceeding involving theCompany.

Section 3.03 Officers.The Manager may appoint one or more individuals as officers of the Company (the "Officers") as the Manager deems necessary or desirable to carry on the business of the Company and may

delegate to such Officers such power and authority as the Manager deems advisable. An Officer is not required to be a Member of the Company. Any individual may hold two or more offices of the Company. Each Officer shall hold office until his or her successor is designated by the Manager or until his or her earlier death, resignation, or removal. Any Officer may resign at any time upon written notice to the Manager. Any Officer may be removed by the Manager at any time, with or without cause. A vacancy in any office occurring because of death, resignation,

removal, or otherwise may, but need not, be filled by the Manager.

Section 3.04 Replacement and Resignation of Manager.The Manager may be removed at any time, with or without cause, by the Members holding a majority of the Membership Interests. The Manager may resign at any time by delivering a written resignation to the Company, which resignation shall be effective upon receipt thereof

unless it is specified to be effective at some other time or upon the occurrence of a particular event. Following the Manager's removal or resignation, a successor Manager p. 265shall be elected by the affirmative vote of the

Members holding a majority of the Membership Interests. The removal of the Manager shall not affect the Manager's rights as a Member and shall not constitute a withdrawal of such Member from the Company.

ARTICLE IV

Allocations

Section 4.01 Allocation of Profits and Losses.

1. The Company's profits and losses for each Fiscal Yearwill be allocated among the Members pro rata inaccordance with their Membership Interests.
2. Notwithstanding any other provision of this Agreement, (i) "partner nonrecourse deductions" (as defined inTreasury Regulations Section 1.704-2(i)), if any,of the Company shall be allocated for each Fiscal Yearto the Member that bears the economic risk of loss within the meaning of Treasury Regulations Section 1.704-2(i) and "nonrecourse deductions" (as defined in Treasury Regulations Section 1.704-2(b))and

"excess nonrecourse liabilities" (as defined in Treasury Regulations Section 1.752-3(a)), if any, shall be allocated to and among the Members in accordance with their Membership Interests.

1. This Agreement shall be deemed to include "qualified income offset," "minimum gain chargeback," and "partner nonrecourse debt minimum gain chargeback" provisions within the meaning ofTreasury

Regulations under Section 704(b) of the Code.

1. All items of income, gain, loss, deduction, and credit of the Company shall be allocated among theMembers for federal, state, and local income tax purposes consistent with the manner that the

corresponding items are allocated among the Members pursuant to this section, except as may otherwise be provided herein or under the Code.

ARTICLE V

Distributions

Section 5.01 Distributions.

1. Distributions of available cash shall be made to the Members at the times and in the aggregate amounts determined by the Manager. Such distributions shall be paid to the Members pro rata in accordance withtheir respective Membership Interests.
2. Notwithstanding any provision to the contrary contained in this Agreement, the Company shall not make any distribution to p. 266Members if such distribution would violate Section 18-607 of the Delaware Act orother ApplicableLaw.

ARTICLE VI

Transfers

Section 6.01 General Restrictions on Transfer.

1. Except as permitted pursuant to Section 6.02, no Member shall Transfer all or any portion ofits

Membership Interest in the Company, except with the written consent of Members holding a majority of the Membership Interests. No Transfer of Membership Interests to a Person not already a Member of the

Company shall be deemed completed until the prospective Transferee is admitted as a Member of the Company in accordance with Section 2.03 hereof.

1. Notwithstanding any other provision of this Agreement (including Section 6.02), each Member agrees thatit will not Transfer all or any portion of its Membership Interest in the Company, and the Company agreesthatit shall not issue any Membership Interests:

1. except as permitted under the Securities Act and other applicable federal or state securities or bluesky laws, and then, with respect to a Transfer of Membership Interests, only upon delivery tothe

Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act;

1. if such Transfer or issuance would affect the Company's existence or qualification as a limited liability company under the Delaware Act;or

1. if such Transfer or issuance would cause the Company to lose its status as a partnership for federal income tax purposes;

1. Any Transfer or attempted Transfer of any Membership Interest in violation of this Agreement shall benulland void, no such Transfer shall be recorded on the Company's books, and the purported Transferee in any such Transfer shall not be treated (and the purported Transferor shall continue be treated) as the owner of such Membership Interest for all purposes of thisAgreement.

1. Except as provided in Section 2.04(b), no Transfer (including a Permitted Transfer) of Membership Interests to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee (including a Permitted Transferee) is admitted as a Member of the Companyinaccordance with Section 2.03(b) hereof.

Section 6.02 Permitted Transfers.The provisions of Section 6.01(a) shall not apply to any Transfer by anyMember of all or any portion of its Membership Interest to any of the following (each, a "Permittedp.

267Transferee" and, any such Transfer to a Permitted Transferee, a "Permitted Transfer"):

1. Any Affiliate of such Member;or
2. (i) Such Member's spouse, parent, siblings, descendants (including adoptive relationships and stepchildren), and the spouses of each such natural persons (collectively, "Family Members"); (ii) a trust under which the distribution of Membership Interests may be made only to such Member and/or any FamilyMember of such Member; (iii) a charitable remainder trust, the income from which will be paid to such

Member during his life; (iv) a corporation, partnership, or limited liability company, the stockholders,

partners, or members of which are only such Member and/or Family Members of such Member; or (v) by will or by the laws of intestate succession, to such Member's executors, administrators, testamentary trustees, legatees, distributees, or beneficiaries.

ARTICLE VII

No Personal Liability and Indemnification

Section 7.01 No Personal Liability: Members; Manager.

1. Except as otherwise provided in the Delaware Act, by Applicable Law,or expressly in this Agreement, no Member will be obligated personally for any debt, obligation, or liability of the Company or other Members,whether arising in contract, tort, or otherwise, solely by reason of being aMember.

1. Except as otherwise provided in the Delaware Act, by Applicable Law,or expressly in this Agreement, no Manager will be obligated personally for any debt, obligation, or liability of the Company, whether arising in contract, tort, or otherwise, solely by reason of being aManager.

Section 7.02 Indemnification.

1. Tothe fullest extent permitted under the Delaware Act, any Covered Person (as defined in section (c) below) shall be entitled to indemnification and reimbursement of reasonable expenses from the Company for and against any loss, damage, claim, or expense (including reasonable attorneys' fees) (collectively, "Losses") whatsoever incurred by the Covered Person relating to or arising out of any act or omission or alleged acts or omissions (whether or not constituting negligence) performed or omitted by any Covered Person on behalf of the Company; provided, however, that (i) any indemnity under this Section 7.02 shall be provided out of and to the extent of the Company assets only,and neither any Member or any other Person shall have any personal liability to contribute to such indemnity by the Company; (ii) such CoveredPerson acted in good faith and in a manner believed by such Covered Person to be in, or not opposed to, the best interests of the Company and, with respect to any criminal proceeding, had no reasonable cause

to believe his conduct was p. 268unlawful; and (iii) such Covered Person's conduct did not constitute fraud or willful misconduct.

1. Upon receipt by the Company of a written undertaking by or on behalf of the Covered Person to repay suchamounts if it is finally judicially determined that the Covered Person is not entitled to indemnification under this Section 7.02, the Company shall advance, to the extent reasonably required, each Covered Person for reasonable legal or other expenses (as incurred) of such Covered Person in connection with investigating, preparing to defend, or defending any claim, lawsuit, or other proceeding relating to any Losses for which such Covered Person may be indemnified pursuant to this Section 7.02.
2. For purposes of this Section 7.02, "Covered Person" means (i) each Member; (ii) each Manager and OfficeroftheCompany;and(iii)eachofficer,director,shareholder,partner,manager,member,Affiliate,employee, agent, or representative of each Member and of eachManager.

ARTICLE VIII

Accounting and Tax Matters

Section 8.01 Inspection Rights.Upon reasonable notice from a Member, the Company shall afford the Member access during normal business hours to the corporate, financial, and similar records, reports, and documents of the Company, and shall permit the Member to examine such documents and make copies thereof.

Section 8.02 Income Tax Status.It is the intent of this Company and the Members that this Company shall be treated as a partnership for US, federal, state, and local income tax purposes. Neither the Manager nor any

Member shall make an election for the Company to be classified as other than a partnership pursuant to Treasury Regulations Section 301.7701-3.

Section 8.03 Partnership Representative.

1. Appointment; Resignation. The Members hereby appoint the Manager as the "partnership representative"as provided in Section 6223(a) of the Code (the "Partnership Representative"). ThePartnership

Representative can be removed at any time by a vote of Members holding a majority of the Membership Interests of the Company, and shall resign if it is no longer a Member. In the event of the resignationor

removal of the Partnership Representative, the holders of a majority of the Membership Interests of the

Company shall appoint a new Partnership Representative. If the resignation or removal of the Partnership Representative occurs prior to the effectiveness of the resignation or removal under applicable Treasury Regulations or other administrative guidance, the Partnership Representative that has resigned or been

removed shall not take any actions in its capacity p. 269as Partnership Representative except as directed by Members holding a majority of the Membership Interests of the Company.

1. TaxExaminations and Audits. The Partnership Representative is authorized and required to represent the Company (at the Company's expense) in connection with all examinations of the Company's affairs byany

federal, state, local, or foreign taxing authority, including resulting administrative and judicial proceedings, and to expend Company funds for professional services and costs associated therewith.

The Partnership Representative shall have sole authority to act on behalf of the Company in any such examinations and any resulting administrative or judicial proceedings, and shall have sole discretion to determine whether the Company (either on its own behalf or on behalf of the Members) will contest or continue to contest any tax deficiencies assessed or proposed to be assessed by any taxing authority.

Section 8.04 Tax Returns.

1. At the expense of the Company, the Manager will cause the preparation and timely filing (including extensions) of all tax returns required to be filed by the Company pursuant to the Code as well as all other required tax returns in each jurisdiction in which the Company owns property or does business. As soon asreasonably possible after the end of each Fiscal Year, the Manager will deliver to each MemberCompany

information necessary for the preparation of such Member's federal, state, and local income tax returns for such Fiscal Year.

1. Each Member agrees that such Member shall not treat any Company item on such Member's federal, state, foreign, or other income tax return inconsistently with the treatment of the item on the Company'sreturn.

ARTICLE IX

Dissolution and Liquidation

Section 9.01 Events of Dissolution.The Company shall be dissolved and its affairs wound up only upon the occurrence of any of the following events:

1. An election to dissolve the Company made by holders of a majority of the Membership Interests;
2. The sale, exchange, involuntary conversion, or other disposition or Transfer of all or substantially all theassets of the Company; or
3. The entry of a decree of judicial dissolution under 18-802 of the DelawareAct.
   1. , and the Certificate of Formation shall have been cancelled as provided in Section 9.04.

Section 9.02 Effectiveness of Dissolution.Dissolution of the Company shall be effective on the day on which the event described in Section 9.01 occurs, but the Company shall not terminate until the winding up of the

Company has been completed, the assets of the Company p. 270have been distributed as provided in Section

Section 9.03 Liquidation.If the Company is dissolved pursuant to Section 9.01, the Company shall be liquidated and its business and affairs wound up in accordance with the Delaware Act and the following provisions:

1. The Manager, or another Person selected by the Manager, shall act as liquidator to wind up theCompany(the "Liquidator"). The Liquidator shall have full power and authority to sell, assign, and encumber any orall of the Company's assets and to wind up and liquidate the affairs of the Company in an orderly and business-likemanner.

1. As promptly as possible after dissolution and again after final liquidation, the Liquidator shall cause a proper accounting to be made by a recognized firm of certified public accountants of the Company's assets, liabilities, and operations through the last day of the calendar month in which the dissolution occursor the final liquidation is completed, as applicable.

1. The Liquidator shall liquidate the assets of the Company and distribute the proceeds of such liquidation inthe following order of priority, unless otherwise required by mandatory provisions of ApplicableLaw:

1. First, to the payment of the Company's debts and liabilities to its creditors (including Members, if applicable) and the expenses of liquidation (including sales commissions incident to any sales of

assets of the Company);

1. Second, to the establishment of and additions to reserves that are determined by the Manager to bereasonably necessary for any contingent unforeseen liabilities or obligations of the Company; and
2. Third, to the Members, on a pro rata basis, in accordance with the positive balances in their

respective Capital Accounts, as determined after taking into account all Capital Account adjustments for the taxable year of the Company during which the liquidation of the Company occurs.

Section 9.04 Required Filings.Upon completion of the winding up of the Company, the Liquidator shall make all necessary filings required by the Delaware Act.

ARTICLE X

Definitions

Section 10.01 Definitions.Capitalized terms used herein and not otherwise defined shall have the meanings set forth in this Section 10.01:

1. "Affiliate" means, with respect to any Person, any other Person who, directly or indirectly, controls, is controlled by,or is under p. 271common control with such Person. For purposes of this definition, "control" when used with respect to any specified Person, shall mean the power, direct or indirect, to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities or partnership or other ownership interests, by contract, or otherwise; and the terms "controlling" and "controlled" shall have correlative meanings.
2. "Applicable Law" means all applicable provisions of (i) constitutions, treaties, statutes, laws (including the common law), rules, regulations, decrees, ordinances, codes, proclamations, declarations, or orders of any Governmental Authority; (ii) any consents or approvals of any Governmental Authority; and (iii) any orders, decisions, advisory, or interpretative opinions, injunctions, judgments, awards, decrees of, or agreements with, any GovernmentalAuthority.
3. "Certificate of Formation" means the certificate of formation filed with the Delaware Secretary of State onMarch 9, 2014.

1. "Code" means the Internal Revenue Code of 1986, as amended.
2. "Delaware Act" means the Delaware Limited Liability Company Act and any successor statute, as itmay be amended from time to time.
3. "Electronic Transmission" means any form of communication not directly involving the physical transmission of paper that creates a record that may be retained, retrieved, and reviewed by a recipient thereof and that may be directly reproduced in paper form by such a recipient through an automated process.
4. "Equity Securities" means any and all Membership Interests of the Company and any securities of theCompany convertible into, exchangeable for,or exercisable for,such Membership Interests, including, without limitation, any warrants or other rights to acquire such Membership Interests.

1. "Fiscal Year" means the calendar year,unless the Company is required or elects to have a taxable year other than the calendar year,in which case Fiscal Yearshall be the period that conforms to its taxableyear.
2. "Governmental Authority" means any federal, state, local, or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extentthat the rules, regulations, or orders of such organization or authority have the force of law), or any arbitrator, court, or tribunal of competentjurisdiction.

1. "Lien" means any mortgage, pledge, security interest, option, right of first offer,encumbrance, or otherrestriction or limitation of any naturewhatsoever.

1. p. 272"Manager" means, initially, George W.Smith, or such other Member as may be designated orbecome the Manager pursuant to the terms of thisAgreement.

1. "Membership Interest" means an interest in the Company owned by a Member, including suchMember's rights to (i) receive a distributive share of Company assets and items of Company income, gain, loss, and deduction; (ii) vote, consent, or participate in any Member decisions provided in this Agreement andthe

Delaware Act; and (iii) receive any and all other benefits due to a Member under this Agreement and the Delaware Act. The Membership Interest of each Member will be stated as a percentage interest in the same proportion as the total Capital Contributions of such Member bears to the total Capital Contributions of all Members.

1. "Person" means an individual, corporation, partnership, joint venture, limited liability company,Governmental Authority, unincorporated organization, trust, association, or otherentity.
2. "Securities Act" means the Securities Act of 1933, as amended, or any successor federal statute, andthe rules and regulations thereunder, which shall be in effect at thetime.

1. "Transfer" means to sell, transfer, assign, gift, pledge, encumber, hypothecate, or similarly dispose of, directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, or to enter into any contract, option, or other arrangement or understanding with respect to the sale, transfer, assignment, gift,pledge, encumbrance, hypothecation, or similar disposition of, any Membership Interests or any interest

(including a beneficial interest) therein. "Transfer" when used as a noun shall have a correlative meaning.

1. "Transferor" and "Transferee" mean a Person who makes or receives a Transfer,respectively.

ARTICLE XI

Miscellaneous

Section 11.01 Governing Law.This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule

(whether of the State of Delaware or any jurisdiction).

Section 11.02 Waiver.No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No failure to exercise, or delay in exercising, any right,

remedy,power, or privilege arising from this Agreement shall operate or be construed as a waiver thereof,nor

shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege.

p. 273Section 11.03 Remedies.In the event of any actual or prospective breach or default by any party,the other parties shall be entitled to equitable relief, including remedies in the nature of injunction and specific performance, awarded by a court of competent jurisdiction (without being required to post a bond or other securityor to establish any actual damages). In this regard, the parties acknowledge and agree that they will be

irreparably damaged in the event this Agreement is not specifically enforced, since (among other things) the

Membership Interests are not readily marketable. All remedies hereunder are cumulative and not exclusive, may be exercised concurrently, and nothing herein shall be deemed to prohibit or limit any party from pursuing any other remedy or relief available at law or in equity for any actual or prospective breach or default, including

recovery of damages. In addition, the parties hereby waive and renounce any defense to such equitable relief that an adequate remedy at law may exist.

Section 11.04 Severability.If any term or provision of this Agreement is held to be invalid, illegal, or unenforceable under Applicable Law in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction.

Section 11.05 Successors and Assigns.Subject to the restrictions on Transfers set forth herein, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective heirs, executors, administrators, successors, and assigns.

Section 11.06 Amendment.No provision of this Agreement may be amended or modified except by an

instrument in writing executed by all Members. Any such written amendment or modification will be binding upon the Company and each Member. Notwithstanding the foregoing, amendments to the Members Schedule may bemade by the Manager in accordance with Section 3.02(a).

Section 11.07 Headings.The headings in this Agreement are inserted for convenience or reference only and are in no way intended to describe, interpret, define, or limit the scope, extent, or intent of this Agreement or any provision of this Agreement.

Section 11.08Counterparts.This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement.

Section 11.09 Entire Agreement.This Agreement, together with the Certificate of Formation and all related Exhibits and Schedules, constitutes the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein and therein, and supersedes all prior and contemporaneous understandings, agreements, representations, and warranties, both written and oral, with respect to such subject matter.

p. 274Section 11.10. No Third-Party Beneficiaries.Except as provided in Article VII, this Agreement is for the sole benefit of the parties hereto (and their respective heirs, executors, administrators, legal representatives, successors, and permitted assigns) and nothing herein, express or implied, is intended to or shall confer upon any other Person, including any creditor of the Company, any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

The Company: AAA POOL SERVICES, LLC, a Delaware limited liability company

By: GEORGE W. SMITH

Its: President

The Members:

Thomas J. Gray Thomas J. Gray

GEORGE W. SMITH

George W. Smith

MichaelB.Watson Michael B.Watson

Schedule 1

MEMBERS SCHEDULE

(as of March 9, 2014)

Members	Total Capital Contribution	Membership Interest
Thomas J. Gray	$90,000	45%
George W. Smith	$90,000	45%
Michael B. Watson	$20,000	10%
TOTAL	$200,000	100%