EXHIBIT 3.10
================================================================================
LIMITED LIABILITY COMPANY AGREEMENT
OF
ACC OF KENTUCKY LLC
A DELAWARE LIMITED LIABILITY COMPANY
================================================================================
LIMITED LIABILITY COMPANY AGREEMENT
OF
ACC OF KENTUCKY LLC
This Limited Liability Company Agreement dated as of December 31, 1998
is made by and between the persons whose signatures appear on the signature page
hereof.
ARTICLE 1 -- FORMATION
1.1 CERTIFICATE OF FORMATION. A Certificate of Formation was
filed with the Secretary of State of the State of Delaware on December 22,
1998, and was deemed effective on December 31, 1998, the date on which the
term of the Company shall begin (the "Certificate of Formation").
1.2 NAME. The name of the limited liability company is "ACC of
Kentucky LLC".
1.3 PURPOSE. The purpose of the Company is to engage in any and
all lawful businesses or activities in which a limited liability company may
be engaged under applicable law (including, without limitation, the Act).
1.4 TERM. The Company shall commence on the effective date
specified in the Certificate of Formation and shall continue in existence in
perpetuity unless its business and affairs are earlier wound up following
dissolution at such time as this Agreement may specify.
1.5 REGISTERED OFFICE; REGISTERED AGENT. The registered office
of the Company required by the Act to be maintained in the State of Delaware
shall be the initial registered office named in the Certificate of Formation
or such other office (which need not be a place of business of the Company) as
the Managing Member may designate from time to time in the manner provided by
the Act. The registered agent of the Company in the State of Delaware shall be
the initial registered agent named in the Certificate of Formation or such
other person or entity as the Managing Member may designate from time to time
in the manner provided by the Act.
1.6 PRINCIPAL OFFICE. The principal office of the Company shall
be at 000 Xxxxx Xxxxxx Xxxxx, Xxxxxxxx, Xxxxxxxx 00000 or at such other place
as the Managing Member may designate from time to time.
1
ARTICLE 2 -- DEFINITIONS
The following terms used in this Agreement shall have the following
meanings (unless otherwise expressly provided herein):
"ACC OF TENNESSEE" means ACC of Tennessee LLC, a Delaware limited
liability company.
"ACW" means American Cellular Wireless LLC, a Delaware limited
liability company.
"ACT" the Delaware Limited Liability Company Act, 6 Del. C Sections
18-101, ET SEQ., as it may be amended from time to time, and any successor to
such statute.
"AGREEMENT" means this limited liability company agreement, as
originally executed and as amended from time to time.
"CAPITAL ACCOUNT" has the meaning defined in SECTION 3.4.
"CAPITAL CONTRIBUTION" means, with respect to each Member, the amount
contributed by such Member to the capital of the Company pursuant to SECTIONS
3.2 and 3.3.
"CERTIFICATE OF FORMATION" has the meaning defined in SECTION 1.1.
"CODE" means the Internal Revenue Code of 1986, as amended, or
corresponding provisions of subsequent superseding federal revenue laws.
"COMPANY" means the limited liability company governed by this
Agreement.
"DEFICIT CAPITAL ACCOUNT" means, with respect to any Member, the
deficit balance, if any, in such Member's Capital Account as of the end of the
taxable year, after giving effect to the following adjustments:
(i) credit to such Capital Account any amount that such Member
is obligated to restore to the Company under Regulation Section 1.704-1(b)(2)
(ii)(c), as well as any addition thereto pursuant to the next to last sentences
of Regulation Sections 1.704-2(g)(1) and (i)(5); and
(ii) debit to such Capital Account the items described in
Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6)
This definition is intended to comply with the provisions of Regulation Sections
1.704-1(b)(2)(ii)(d) and 1.704-2, and shall be interpreted consistently with
those provisions.
"DISTRIBUTABLE CASH" means, with respect to any fiscal period, all cash
receipts received by the Company from operations
2
in the ordinary course of business including, without limitation, income from
invested Reserves and cash receipts of the Company from any borrowing by the
Company, but after deducting Operating Cash Expenses, debt service, commitment
fees, loan broker fees, and other payments made in connection with any loan to
the Company or other loans secured by lien on the Company's assets, capital
expenditures of the Company and amounts set aside for the creation of or
addition to Reserves, all as determined in the discretion of the Managing
Member. Distributable Cash does not include Capital Contributions made in
accordance with ARTICLE 3. The Managing Member shall use its discretion to
determine the nature and extent of Distributable Cash.
"MAJORITY PERCENTAGE INTEREST" means the vote, approval, consent or
other action of Members entitled to act or vote thereon holding more than
fifty percent (50%) of the outstanding Units held by such Members as of the
date on which the event triggering the vote, approval, consent or other action
of Members occurs.
"MANAGING MEMBER" means ACC of Tennessee and any successor managing
member of the Company appointed by the Members in accordance with the terms of
this Agreement and the Act. The Managing Member shall be the "manager" of the
Company for purposes of the Act.
"MEMBER" means each person who executes a counterpart of this Agreement
as a Member and each person who may hereafter be admitted to the Company as an
additional or substituted Member.
"OPERATING CASH EXPENSES" means, with respect to any fiscal period, the
amount of cash disbursed in the ordinary course of operations of the Company
during such period, including without limitation, all cash expenses such as
expenses relating to marketing, sales, regulatory matters, technical matters,
engineering matters, rights of way, telecommunication expenses, utility charges,
administrative costs, advertising expenses, legal and accounting fees, insurance
premiums, taxes, and repair and maintenance expenses, all as determined in the
discretion of the Managing Member. Operating Cash Expenses shall not include
expenditures paid out of Reserves.
"PERCENTAGE INTEREST" means, with respect to any Member at any time,
the percentage determined based on the ratio that the number of Units held by
such Member bears to the total number of outstanding Units.
"REGULATION" includes temporary and final Treasury regulations
promulgated under the Code and the corresponding sections of any Treasury
regulations subsequently issued that amend or supersede such regulations.
3
"RESERVES" means, with respect to any fiscal period, funds set aside or
amounts allocated during such period to reserves that may be maintained by the
Company for working capital and to pay taxes, insurance, debt services or other
costs or expenses of the Company, all as determined in the discretion of the
Managing Member.
"PRIME RATE" means on any day the prime rate of interest as quoted in
the WALL STREET JOURNAL, or if the WALL STREET JOURNAL shall not quote such
rate, a comparable base lending rate publicly announced by a commercial bank,
selected by the Managing Member.
"UNITS" means the Units issued to the Members pursuant to this
Agreement as set forth on attached SCHEDULE 1, as amended from time to time.
ARTICLE 3 -- MEMBERS, CONTRIBUTIONS AND INTERESTS
3.1 MEMBERS' NAMES, ADDRESSES AND PERCENTAGES. The names and
addresses of the Members, and their initial Units and Percentage Interests are
set forth on attached SCHEDULE 1, as amended from time to time.
3.2 CONTRIBUTIONS
3.2.1 INITIAL CONTRIBUTIONS. Upon execution of this
Agreement, the Members shall make the following Capital Contributions to the
Company: (i) ACW shall cause Three Cellular Corporation, a Delaware
corporation and wholly-owned subsidiary of ACW, to contribute all of its
assets and liabilities to the Company (with an net fair market value of
$229,230,000) by operation of merger of Three Cellular Corporation into the
Company; and (ii) ACC of Tennessee shall contribute cash in the amount of
$1,151,910 to the Company.
3.2.2 ADDITIONAL CONTRIBUTIONS. Additional Capital
Contributions shall be required only if the Managing Member and the Members
holding a Majority Percentage Interest approve the amount of each additional
Capital Contribution. If the Managing Member and the Members approve
additional Capital Contributions, the Members shall make such additional
Capital Contributions on a pro rata basis in accordance with their Percentage
Interests within the time period determined by the Company.
In the event that any Member fails to make a required additional
Capital Contribution within the time required, the non- defaulting Members may,
at their option and as determined by such Members holding a Majority Percentage
Interest:
(a) contribute to the Company an amount equal to the
defaulting Member's required additional Capital
4
Contribution and elect to readjust the Units and Percentage Interests
of the Members so that the Units and Percentage Interest of each Member
are in the ratio of a fraction, the numerator of which is the aggregate
Capital Contributions of each Member pursuant to this SECTION 3.2 and
the denominator of which is the aggregate Capital Contributions of all
Members pursuant to this SECTION 3.2; or
(b) advance an amount equal to such required
additional Capital Contribution on behalf of the defaulting Member (a
"Default Loan"). Default Loans shall bear interest at the lesser of
the maximum rate permitted by law or the Prime Rate in affect as of
the first day of each calendar month, plus 3% per annum, and such
interest rate shall be adjusted as of the first day of each calendar
month. Default Loans shall be repayable within thirty (30) days after
written demand and if not sooner repaid or demand made, shall be
repaid from any cash distributions otherwise distributable by the
Company to the defaulting Member (and charged against the Defaulting
Member's Capital Account) or offset against any amount to be paid to
the defaulting Member by the Company.
3.2.3 NO INTEREST; NO WITHDRAWAL OF CAPITAL. No interest shall
be paid on Capital Contributions and no Member shall have the right to
withdraw its Capital Contribution.
3.3 ADDITIONAL MEMBERS. The Company may, from time to time,
admit additional persons as Members with the consent of the Managing Member
and the Members holding a Majority Percentage Interest.
3.4 CAPITAL ACCOUNTS. A capital account ("Capital Account")
shall be determined and maintained for each Member in accordance with the
principles of Regulation Section 1.704-1(b) at all times throughout the full
term of the Company. In the event of a permitted sale or assignment of all or
any part of a Member's interest in the Company, the Capital Account of the
transferor shall become the Capital Account of the transferee to the extent it
relates to the transferred Company interest.
In the discretion of the Managing Member, the book value of all
Company properties may be adjusted to equal their respective gross fair market
values, as determined by the Managing Member as of the following times: (1) in
connection with the acquisition of an interest in the Company by a new or
existing Member for more than a DE MINIMIS Capital Contribution; (2) in
connection with the liquidation of the Company as defined in Regulation
Section 1.704-(1)(b)(2)(ii)(g); or (3) in connection with a more than DE
MINIMIS distribution to a retiring or a continuing Member as consideration for
all or a portion of its interest in the Company. In the event of a revaluation
of any
5
Company assets hereunder, the Capital Accounts of the Members shall be
adjusted, including continuing adjustments for depreciation, to the extent
provided in Regulation Section 1.704-(1)(b)(2)(iv)(f).
3.5 TRANSFER OF MEMBER'S INTEREST. Subject to the provisions of
SECTION 3.3 hereof, a Member may give, sell, assign, pledge, hypothecate,
exchange or otherwise transfer to another person any portion of its interest
in the Company accordance with the provisions of Section 18-702 of the Act. No
person acquiring an interest in the Company pursuant to this SECTION 3.5 shall
become a Member unless such person is approved by the vote or written consent
of the Managing Member and the Members' holding a Majority Percentage Interest
(exclusive of the Member who assigned or proposes to assign such interest) .
If no such approval is obtained, such person's interest in the Company shall
only entitle such person to receive the distributions and allocations of
profits and losses to which the Member from whom or which such person received
such interest would otherwise be entitled. Any such approval may be subject to
any terms and conditions imposed by the consenting Members.
ARTICLE 4 -- MEETINGS OF MEMBERS
4.1 MEETINGS. Meetings of Members are not required, but may be
called by the Managing Member or Members holding at least twenty percent (20%)
of the Percentage Interests held by Members. No business shall be transacted
at any meeting of Members except as is specified in the notice calling such
meeting.
4.2 PLACE OF MEETINGS. The Members may designate any place,
either within or outside the State of Delaware, as the place of meeting for
any meeting of the Members. If no designation is made, the place of meeting
shall be the principal office of the Company specified in SECTION 1.6.
4.3 NOTICE OF MEETINGS. Written notice stating the place, day
and time of the meeting and the purpose for which the meeting is called shall
be delivered not less than ten (10) nor more than sixty (60) days before the
date of the meeting, either personally or by mail, by or at the direction of
the Managing Member or the Members calling the meeting, to each Member
entitled to vote at such meeting. If mailed, such notice shall be deemed to be
delivered three (3) calendar days after being deposited in the United States
Mail, addressed to the Member at his, her or its address as it appears on the
records of the Company, postage prepaid.
4.4 RECORD DATE. For the purpose of determining Members entitled
to notice of or to vote at any meeting of Members or any adjournment thereof,
or Members entitled to any distribution, the date on which notice of the
meeting is first delivered or mailed, or the date on which a resolution
declaring such distribution is
6
adopted, as the case may be, shall be the record date for such determination
of Members. When a determination of Members entitled to vote at any meeting of
Members has been made as provided in this SECTION 4.4, such determination
shall apply to any adjournment thereof.
4.5 QUORUM. Members holding a Majority Percentage Interest,
represented in person or by proxy, shall constitute a quorum at any meeting of
Members. In the absence of a quorum at any such meeting, a majority of the
Percentage Interests so represented may adjourn the meeting from time to time
for a period not to exceed sixty (60) days without further notice. However, if
the adjournment is for more than sixty (60) days, or if after the adjournment
a new record date is fixed for the adjourned meeting, notice of the adjourned
meeting shall be given to each Member. At such adjourned meeting at which a
quorum shall be present or represented, any business may be transacted which
might have been transacted at the meeting as originally noticed.
4.6 MANNER OF ACTING. If a quorum is present, the affirmative
vote of Members present at the meeting in person or by proxy holding a
Majority Percentage Interest of Members shall be the act of the Members,
except as otherwise required by the Act or this Agreement.
4.7 PROXIES. At all meetings of Members, a Member may vote in
person or by proxy executed in writing by the Member or by the Member's
attorney-in-fact or agent appointed in writing. Such proxy or appointment
shall be filed with the Company before or at the time of the meeting. No proxy
or appointment shall be valid after eleven (11) months from the date of its
execution, unless otherwise provided in the proxy or appointment.
4.8 WAIVER OF NOTICE. When any notice is required to be given to
any Member, a waiver thereof in writing signed by the Member entitled to such
notice, whether before, at, or after the time stated therein, shall be
equivalent to the giving of such notice. Attendance at a meeting shall
constitute waiver of notice of the meeting unless the Member at the beginning
of the meeting objects to holding the meeting or transacting business at the
meeting.
4.9 ACTION WITHOUT MEETING. Any action required or permitted to
be taken by the Members at a meeting may be taken without a meeting if a
consent in writing, describing the action taken, is signed by the Members
holding a Majority Percentage Interest, or such greater Percentage Interest as
is required by the Act or by this Agreement. Such actions shall be included in
the minutes of the Company's meetings.
4.10 MEETINGS BY TELEPHONE, ETC. Meetings of the Members may be
held by conference telephone or by any other means of
7
communication by which all participants can hear each other simultaneously
during the meeting, and such participation shall constitute presence in person
at the meeting.
ARTICLE 5 -- MANAGEMENT
5.1 MANAGEMENT; MANAGING MEMBER. The business, affairs and
properties of the Company shall be managed by the Managing Member.
The initial Managing Member of the Company shall be ACC of
Tennessee.
Except as otherwise provided in this Agreement and subject to the
non-waivable provisions of the Act, the Managing Member shall have full and
complete authority, power and discretion to manage and control the business,
affairs and property of the Company, and to make all decisions regarding those
matters and to perform any and all acts or activities customary or incident to
the management of the Company's business. No other person shall have any power
or authority to bind the Company unless such person has been authorized to do
so by this Agreement or the Managing Member. The Managing Member shall serve
as the manager of the Company until its removal or resignation as provided in
this Agreement. Any replacement manager of the Company shall be appointed by
the Members holding a Majority Percentage Interest.
5.2 REMOVAL OF MANAGING MEMBER. The Managing Member may be
removed or replaced as the manager of the Company, with or without cause, by
the vote or written consent of the Members holding a Majority Percentage
Interest. The removal of the Managing Member as the manager of the Company
shall not affect the Managing Member's rights as a Member and shall not
constitute a withdrawal of such Member.
5.3 RESIGNATION OF MANAGING MEMBER. The Managing Member may
resign as manager of the Company at any time by giving twenty (20) days'
written notice to the Company. The resignation of any Managing Member shall
take effect upon receipt of such notice or at any later time specified in such
notice. Unless otherwise specified in such notice, the acceptance of the
resignation shall not be necessary to make it effective. The resignation of
the Managing Member shall not affect the Managing Member's rights as a Member
and shall not constitute a withdrawal of a Member.
5.4 OFFICERS. The Managing Member may appoint a Chief Executive
Officer, President, Chief Operating Officer, Chief Financial Officer and one
or more Vice Presidents and such other officers of the Company as the Managing
Member may deem necessary or advisable to manage the day-to-day business
affairs of the Company. The officers of the Company shall serve at the
pleasure of the Managing Member. To the extent delegated by the Managing
Member, the officers of the Company shall have the authority to act on behalf
of, bind and execute and deliver documents in the name and on behalf of the
Company. No such delegation shall
8
cause the Managing Member to cease to be the manager or a Member of the
Company. Such officers shall have such authority and responsibility as is
generally attributable to the holders of such offices in corporations
incorporated under the laws of Delaware. The Managing Member hereby appoints
the following persons to serve as the initial officers the Company: (i) Xxxx
Xxxxx - Chief Executive Officer; (ii) Xxxxx XxXxxxxx - President and Chief
Operating Officer; (iii) Xxxxx Waiter, Jr. - Vice President, Chief Financial
Officer and Secretary; (iv) Xxxxxxx Xxxxxx - Vice President; (v) Xxxxx
XxXxxxxx - Vice President; and (vi) Xxxxxx Banaczek - Vice President.
5.5 NO EXCLUSIVE DUTY TO COMPANY. The Managing Member shall not
be required to manage the Company as its sole and exclusive function and may
have other business interests and may engage in other activities in addition
to those relating to the Company. Neither the Company nor any Member shall
have any right pursuant to this Agreement to share or participate in such
other business interests or activities or to the income or proceeds derived
therefrom. The Managing Member shall incur no liability to the Company or any
Member as a result of engaging in any other business interests or activities.
ARTICLE 6 -- ACCOUNTING AND RECORDS
6.1 BOOKS OF ACCOUNT. The Company shall maintain records and
accounts of all of its operations and expenditures. At a minimum, the Company
shall keep at its principal place of business the following records:
(a) A current list and past list, setting forth the full
name and last known mailing address of each member and manager;
(b) A copy of the Certificate of Formation and all
amendments thereto;
(c) Copies of this Agreement and all amendments hereto;
(d) Copies of the Company's federal, state, and local tax
returns and reports, if any, for the three (3) most recent years;
(e) Minutes of every meeting of the Members and any written
consents obtained from Members for actions taken by Members without a meeting;
and
(f) Copies of the Company's financial statements for the
three (3) most recent years.
9
6.2 FISCAL YEAR. The fiscal year of the Company shall be the
calendar year.
6.3 TAX RETURNS. The Company shall prepare and timely file all
required federal and state income tax returns. Within ninety (90) days after
the end of each fiscal year, each Member shall be furnished a statement
suitable for use in the preparation of the Member's income tax return.
6.4 TAX MATTERS MEMBER. For purposes of the Code and any
comparable provisions of state law, the "Tax Matters Partner" shall be the
Managing Member or such other eligible Member as Members holding a
Majority Percentage Interest may determine from time to time.
ARTICLE 7 -- ALLOCATIONS OF PROFITS, LOSSES AND OTHER ITEMS
7.1 ALLOCATION OF NET PROFIT AND LOSS - IN GENERAL.
7.1.1 ALLOCATION OF NET PROFIT OR LOSS. After giving
effect to the special allocations set forth in SECTIONS 7.2 and 7.3, the net
profit or net loss of the Company for any fiscal year shall be allocated among
the Members in accordance with their respective Percentage Interests.
7.1.2 LIMITATION. The net loss allocated to each Member
for any Company fiscal year pursuant to SECTION 7.1.1 and this SECTION 7.1.2
shall not exceed the maximum amount of net loss that can be so allocated
without causing such Member to have a Deficit Capital Account at the end of
the fiscal year. All net losses in excess of the limitation set forth in this
SECTION 7.1.2 shall be allocated to the other Members who do not have Deficit
Capital Accounts in proportion to their respective Percentage Interests.
7.2 SPECIAL ALLOCATIONS. The following special allocations shall
be made for any fiscal year of the Company in the following order:
7.2.1 MINIMUM GAIN CHARGEBACK. If there is a decrease in
the Company's "partnership minimum gain", as defined in and determined under
Regulation Sections 1.704-2(b)(2) and 1.704-2(d), the minimum gain
chargeback: provisions of Regulation Section 1.704-2(f), which are hereby
incorporated into this Agreement by this reference, shall be applied.
7.2.2 MEMBER MINIMUM GAIN CHARGEBACK. If there is a
decrease in any Member's share of "partner nonrecourse debt minimum gain," as
defined in and determined under Regulation Section 1.704-2(i), the partner
nonrecourse debt minimum gain chargeback provisions of Regulation Section
1.704-2(i)(4), which are hereby incorporated into this Agreement by this
reference, shall be applied.
10
7.2.3 QUALIFIED INCOME OFFSET. In the event that any
Member unexpectedly receives any adjustments, allocations, or distributions
described in Regulation Sections 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of
Company income and gain shall be specially allocated to such Member in
accordance with Regulation Section 1.704-(1)(b)(2)(ii)(d).
7.2.4 NONRECOURSE DEDUCTIONS. "Nonrecourse deductions," as
defined in and determined under Regulation Sections 1.704-2(b)(1) and (c),
shall be allocated among the Members in accordance with their respective
Percentage Interests.
7.2.5 MEMBER NONRECOURSE DEDUCTIONS. "Partner nonrecourse
deductions," as defined in and determined under Regulation Sections 1.704-2(i)
(1) and (2), shall be specially allocated among the Members in accordance with
Regulation Section 1.704-2(i).
7.3 CORRECTIVE ALLOCATIONS. The allocations set forth in SECTION
7.1.2 and SECTION 7.2 are intended to comply with certain regulatory
requirements under Code Section 704(b). The Members intend that, to the extent
possible, all allocations made pursuant to such Sections will, over the term
of the Company, be offset either with other allocations pursuant to SECTION
7.2 or with special allocations of other items of Company income, gain, loss,
or deduction pursuant to this SECTION 7.3. Accordingly, the Tax Matters
Partner is hereby authorized and directed to make offsetting allocations of
Company income, gain, loss or deduction under this SECTION 7.3 in whatever
manner the Tax Matters Partner determines is appropriate so that, after such
offsetting special allocations are made (and taking into account the
reasonably anticipated future allocations of income and gain pursuant to
SECTIONS 7.2.1 and 7.2.2), the Capital Accounts of the Members are, to the
extent possible, equal to the Capital Accounts each would have if the
provisions of SECTION 7.1.2 and SECTION 7.2 were not contained in this
Agreement and all income, gain, loss and deduction of the Company were instead
allocated pursuant to SECTION 7.1.1.
7.4 OTHER ALLOCATION RULES.
7.4.1 GENERAL. Except as otherwise provided in this
Agreement, all items of Company income, gain, loss, deduction, credit, and any
other allocations not otherwise provided for shall be divided among the
Members in accordance with their Percentage Interests, or as otherwise May be
required under the Code and the Regulations thereunder.
7.4.2 ALLOCATION OF EXCESS NONRECOURSE LIABILITIES. Solely
for purposes of determining a Member's proportionate share of the "excess
nonrecourse liabilities" of the Company within the meaning of Regulation
Section 1.752-3(a)(3), the Members'
11
interests in the Company's profits shall be in accordance with their
respective Percentage Interests.
7.4.3 ALLOCATIONS IN CONNECTION WITH VARYING INTERESTS.
If, during a Company fiscal year, there is (i) a permitted transfer of all or
a part of a Member's interest, or (ii),the admission or withdrawal of a
Member, net profit, net loss, each item thereof, and all other tax items of
the Company for such fiscal year shall be divided and allocated among the
Members by taking into account their varying interests during such fiscal year
in accordance with Code Section 706(d) and using any conventions permitted by
law and selected by the Tax Matters Partner.
7.5 DETERMINATION OF NET PROFIT OR LOSS.
7.5.1 COMPUTATION OF NET PROFIT OR LOSS. The net profit or
net loss of the Company, for each fiscal year or other period, shall be an
amount equal to the Company's taxable income or loss for such period,
determined in accordance with Code Section 703(a) (and, for this purpose, all
items of income, gain, loss or deduction required to be stated separately
pursuant to Code Section 703(a)(1), including income and gain exempt from
federal income tax, shall be included in taxable income or loss).
7.5.2 ADJUSTMENTS TO NET PROFIT OR LOSS. For purposes of
computing taxable income or loss on the disposition of an item of Company
property or for purposes of determining the cost recovery, depreciation, or
amortization deduction with respect to any property, the Company shall use
such property's book value determined in accordance with Regulation Section
1.704-1(b).
7.5.3 ITEMS SPECIALLY ALLOCATED. Notwithstanding any other
provision of this SECTION 7.5, any items that are specially allocated pursuant
to SECTION 7.2 or SECTION 7.3 shall not be taken into account in computing the
Company's net profit or net loss.
7.6 MANDATORY TAX ALLOCATIONS UNDER CODE SECTION 704(c). In
accordance with Code Section 704(c) and Regulation Section 1.704-3, income,
gain, loss and deduction with respect to any property contributed to the
capital of the Company shall, solely for tax purposes, be allocated among the
Members so as to take account of any variation between the adjusted basis of
such property to the Company for federal income tax purposes and its initial
book value computed in accordance with SECTION 7.5.2. Prior to the
contribution of any property to the Company that has a fair market value that
differs from its adjusted tax basis in the hands of the contributing Member on
the date of contribution, the contributing Member and the Managing Member (or,
if the Managing Member is the contributing Member, then non-contributing
Members holding a Majority Percentage Interest) shall agree upon the
allocation method to be applied with respect to that property
12
under Regulation Section 1.704-3, which allocation method shall be set forth
on attached SCHEDULE 2, as amended from time to time. The same procedure shall
apply to any revaluation of Company property as permitted under Regulation
Section 1.704-2(b)(iv)(f); PROVIDED, HOWEVER, that all decisions regarding
valuation and allocation methods under Regulation Section 1.704-3 shall be
made by the Managing Member.
Allocations pursuant to this SECTION 7.6 are solely for purposes of
federal, state, and local taxes and shall not affect, or in any way be taken
into account in computing, any Member's Capital Account or share of net profit,
net loss, or other items as computed for book purposes, or distributions
pursuant to any provision of this Agreement.
ARTICLE 8 -- DISTRIBUTIONS TO MEMBERS
8.1 NONLIQUIDATING DISTRIBUTIONS. Distributions of Distributable
Cash and distributions in kind, other than distributions in liquidation
pursuant to SECTION 8.2, shall be made to the Members in proportion to their
respective Percentage Interests at such times and under such circumstances as
determined by the Managing Member.
8.2 DISTRIBUTIONS IN LIQUIDATION. Notwithstanding SECTION 8.1,
distributions in liquidation of the Company shall be made to each Member in
the manner set forth in ARTICLE 9.
8.3 DISTRIBUTIONS IN KIND. Non-cash assets, if any, shall be
distributed at times and in a manner determined in the discretion of the
Company that reflects how cash proceeds from the sale of such assets for fair
market value would have been distributed (after any unrealized investment
income or loss attributable to such non-cash assets has been allocated among
the Members in accordance with ARTICLE 7).
ARTICLE 9 -- DISSOLUTION AND LIQUIDATION
9.1 DISSOLUTION. The Company shall dissolve and its business and
affairs shall be wound up pursuant to a written instrument executed by the
Members holding a Majority Percentage Interest.
9.2 LIQUIDATION UPON DISSOLUTION AND WINDING UP. Upon the
dissolution of the Company, the Members shall wind up the affairs of the
Company. A full account of the assets and liabilities of the Company shall be
taken. The assets shall be promptly liquidated and the proceeds thereof
applied as required by the Act. Upon discharging all debts and liabilities,
all remaining assets shall be distributed to the Members or their
representatives by the end of the taxable year in which the liquidation occurs
(or, if later, within ninety (90) days after the date of such liquidation) in
proportion to the positive
13
balances of their respective Capital Accounts, as determined after taking into
account all Capital Account adjustments for the taxable year during which the
liquidation occurs (other than those made pursuant to this SECTION 9.2). With
the approval of the Managing Member, the Company may, in the process of
winding up the Company, distribute property in kind, in which case the
Members' Capital Account balances shall be adjusted in accordance with
Regulation Section 1.704-1(b)(2)(iv)(e).
9.3 NO OBLIGATION TO RESTORE NEGATIVE CAPITAL ACCOUNT. No Member
shall have any obligation to make any Capital Contribution to the Company to
eliminate the negative balance, if any, of such Member's Capital Account and
any such negative balance shall not be considered a debt owed by such Member
to the Company or to any other person for any purpose whatsoever.
ARTICLE 10 -- LIMITATION OF MEMBER'S AND MANAGING MEMBER'S
LIABILITY; INDEMNIFICATION OF MEMBERS AND MANAGING MEMBER
10.1 LIMITATION OF LIABILITY. No Member or the Managing Member
shall have any liability to the Company for monetary damages for conduct as a
Member or the Managing Member, except for acts or omissions that involve a
breach of this Agreement, intentional misconduct, a knowing violation of law,
conduct violating Section 18-607 of the Act, or for any transaction from which
such Member or the Managing Member has personally received a benefit in money,
property or services to which such or the Managing Member was not legally
entitled. If the Act is hereafter amended to authorize Company action further
limiting the personal liability of members or managers, then the liability of
any Member or the Managing Member shall be eliminated or limited to the full
extent permitted by the Act, as so amended. No repeal or modification of the
Act or this SECTION 10.1 shall adversely affect any right or protection of any
Member or the Managing Member existing at the time of such repeal or
modification for or with respect to an act or omission of any Member or the
Managing Member occurring prior to such repeal or modification.
10.2 INDEMNIFICATION. The Company shall, to the fullest extent
permitted by applicable law, indemnify, defend and hold each Member and the
Managing Member harmless against any losses, claims, damages or liabilities to
which any Member or the Managing Member may become subject in connection with
any matter arising out of or in connection with this Agreement or the
Company's business or affairs, except for any such losses, claims, damages or
liabilities of any Member or the Managing Member finally adjudicated to be the
result of such Member's or the Managing Member's breach of this Agreement,
intentional misconduct or a knowing violation of law by such Member or the
Managing Member, conduct of such Member or the Managing Member adjudged to be
in violation of Section 18-607 of the Act, or any transaction with respect to
which it was finally adjudged that
14
such Member or the Managing Member received a benefit in money, property, or
services to which such Member or the Managing Member was not legally entitled.
The right to indemnification conferred in this SECTION 10.2 shall be a
contract right and shall include the right to be paid by the Company the
expenses incurred in defending any such proceeding in advance of its final
disposition; provided, that the payment of such expenses in advance of the final
disposition of a proceeding shall be made only upon delivery to the Company of
an undertaking, by or on behalf of such Member or the Managing Member, to repay
all amounts so advanced if it shall ultimately be determined that such Member or
the Managing Member is not entitled to be indemnified under this SECTION 10.2 or
otherwise.
The right to indemnification and payment of expenses incurred in
defending a proceeding in advance of its final disposition conferred in this
SECTION 10.2 shall not be exclusive of any other right any Member or the
Managing Member may have or hereafter acquire under any statute, this Agreement
or otherwise.
No repeal or modification of the Act or this SECTION 10.2 shall
adversely affect-any right of any Member or the Managing Member to
indemnification existing at the time of such repeal or modification for or with
respect to indemnification related to an act or omission of such Member or the
Managing Member occurring prior to such repeal or modification.
ARTICLE 11 -- MISCELLANEOUS
11.1 NOTICES. Any notice or other communication required or
permitted under this Agreement shall be deemed to have been duly given if
delivered personally to the party to whom directed or, if mailed, by
registered or certified mail, postage and charges prepaid, addressed (a) if to
a Member, to the Member's address specified on attached SCHEDULE 1, and (b) if
to the Company, to the Company's address specified in SECTION 1.5. Any such
notice shall be deemed to be given when personally delivered, on the date of
delivery if delivered by overnight courier service, on the date such notice is
sent by telecopier to a telecopy number designated on the Schedule if such
notice is also sent by overnight courier service, or, if mailed, two (2)
business days after the date of mailing. A Member or the Company may change
its address for purposes of notices hereunder by giving notice specifying such
changed address in the manner specified in this SECTION 11.1.
11.2 GOVERNING LAW. This Agreement shall be construed and
enforced in accordance with the internal laws of the State of Delaware,
including, without limitation, the Act.
15
11.3 AMENDMENTS. This Agreement may not be amended except by the
unanimous written agreement of all of the Members.
11.6 WAIVERS. The failure of any person to seek redress for
violation of or to insist upon the strict performance of any covenant or
condition of this Agreement shall not prevent a subsequent act, which would
have originally constituted a violation, from having the effect of an original
violation.
11.7 REMEDIES. The rights and remedies of the parties hereunder
shall not be mutually exclusive, and the exercise of any one right or remedy
shall not preclude or waive the right to exercise any other remedies. Said
rights and remedies are in addition to any other rights the parties may have
by law or otherwise.
11.8 SEVERABILITY. If any provision of this Agreement or the
application thereof to any person or circumstance shall be invalid, illegal or
unenforceable to any extent, the remainder of this Agreement and the
application thereof shall not be affected and shall be enforceable to the
fullest extent permitted by law.
11.9 HEIRS, SUCCESSORS AND ASSIGNS. Each and all of the
covenants, terms, provisions and agreements herein contained shall be binding
upon and inure to the benefit of the parties hereto and, to the extent
permitted by this Agreement, their respective heirs, legal representatives,
successors and assigns.
11.10 CREDITORS. None of the provisions of this Agreement shall
be for the benefit of or enforceable by any creditors of the Company.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date set forth above.
AMERICAN CELLULAR WIRELESS LLC
A Delaware Limited Liability Company
By /s/ Xxxx Xxxxx
-------------------------------
Name: Xxxx Fuji
Title: Chief Executive Officer
ACC OF TENNESSEE LLC
A Delaware Limited Liability Company
By /s/ Xxxxx XxXxxxxx
-------------------------------
Name: Xxxxx XxXxxxxx
Title: President
16
Schedule 1
to
Limited Liability Company Agreement
of
ACC of Kentucky LLC
NAMES AND ADDRESSES OF
MEMBERS UNITS PERCENTAGES
American Cellular Wireless LLC 99.5 99.5%
0000 Xxxx Xxxxxxxxx Xx. Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
ACC of Tennessee LLC 0.5 0.5%
0000 X. Xxxxxx Xxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxxx 00000
TOTALS 100 100%
17
Schedule 2
to
Limited Liability Company Agreement
of
ACC of Kentucky LLC
The Company shall use the "traditional method" of allocation under Regulation
Section 1.704-3(b) with respect to the assets contributed to the Company upon
its formation.
18
