<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: March 9, 2000
(Date of earliest event reported): February 25, 2000
DOBSON COMMUNICATIONS CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Oklahoma 333-23769 73-1513309
(State or Other Jurisdiction of (Commission File (I.R.S. Employer
Incorporation or Organization) Number) Identification Number)
13439 NORTH BROADWAY EXTENSION, SUITE 200
OKLAHOMA CITY, OK 73114
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (405) 529-8500
<PAGE>
ITEM 2. Acquisition or Disposition of Assets
On February 25, 2000, Dobson Communications Corporation, an Oklahoma
corporation, ("Dobson") through its joint venture with AT&T Wireless, Inc.
("AT&T Wireless") acquired a 50 percent interest in American Cellular
Corporation ("American Cellular"). The aggregate acquisition price for
American Cellular was $2.4 billion, including fees and expenses. American
Cellular is an independent rural cellular telephone operator in the United
States, with cellular telephone systems located primarily in rural areas of
the midwestern and eastern United States. The financing for the American
Cellular acquisition came from a combination of equity contributions of $410.0
million by each of Dobson and AT&T Wireless, and by borrowings under the joint
venture's $1.75 billion credit facility. Dobson used proceeds from its initial
public offering to fund its capital contribution.
The terms of the acquisition are more fully described in Dobson's
Registration Statement on Form S-1 (File No. 333-90759).
ITEM 5. Other Events
Dobson has also filed in this Form 8-K certain agreements related to
its initial public offering of Class A common stock and the acquisition of
American Cellular that have been finalized or amended since Dobson's filing of
its final prospectus.
ITEM 7. Financial Statements and Exhibits
(a) Financial Statements of the Business Acquired
The financial statements of American Cellular and Pricellular
Corporation are hereby incorporated by reference to the Annual Report of
American Cellular on Form 10-K for the year ended December 31, 1998 and the
Quarterly Report of American Cellular on Form 10-Q for the quarterly period
ended September 30, 1999.
(b) Pro Forma Financial Information
The following pro forma financial statements give effect to Dobson's
acquisition of a 50 percent interest in American Cellular.
<PAGE>
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL DATA
The accompanying unaudited pro forma balance sheet as of September 30, 1999
gives effect to the following transactions as if they had occurred on
September 30, 1999:
- the recapitalization that was consummated by us immediately prior to the
completion of our offering of Class A common stock;
- the consummation of our offering of 25,000,000 shares of Class A common
stock at an initial public offering price of $22 per share, after
deducting underwriting discounts and commissions and estimated offering
expenses, and the concurrent offering of 1,500,000 shares of Class A
common stock to AT&T Wireless at an offering price of $20.735 per share;
- our acquisition of a 50% interest in the American Cellular joint venture
and its acquisition of American Cellular;
- the redemption of all of our outstanding Class E preferred stock;
- the establishment of a new credit facility to replace the existing credit
facilities of our subsidiaries, Dobson Operating Company and Dobson
Cellular Operations Company;
- the purchase of $159.7 million principal aggregate amount of our 11 3/4%
senior notes using proceeds provided by our new bank credit facility; and
- the distribution, prior to the consummation of our offering of Class A
common stock, of all of the outstanding capital stock of our subsidiary,
Logix, to our stockholders.
In addition, the accompanying unaudited pro forma statements of operations
give effect to the above transactions and the following transactions as if each
had occurred on January 1, 1998:
- our second quarter 1999 issuance of $170.0 million aggregate liquidation
amount of our 13% senior preferred stock and the utilization of the net
proceeds from that issuance to redeem all our Class F and G preferred
stock and to reduce our bank debt; and
- for purposes of the unaudited pro forma statement of operations for the
year ended December 31, 1998, our December 1998 acquisition of Sygnet and
the related financing transactions.
We provide the following unaudited pro forma consolidated financial
statements and the related notes for informational purposes only. The unaudited
pro forma consolidated financial statements are based upon currently available
information and assumptions that we believe are reasonable. The accompanying
data do not purport to represent what our results of operations would have been
if the pro forma transactions had been completed on the dates indicated, nor do
they purport to indicate our future financial position or results of operations.
You should read the unaudited pro forma consolidated financial statements and
notes thereto in conjunction with our historical financial statements and
related notes.
<PAGE>
DOBSON COMMUNICATIONS CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
DOBSON
COMMUNICATIONS
CORPORATION ADJUSTMENTS TOTAL
-------------- ----------- -------------
($ IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C>
Operating revenues:
Service revenues................. $ 117,892 $ -- $ 117,892
Roaming revenues................. 107,296 -- 107,296
Equipment sales and other
revenues....................... 9,952 -- 9,952
--------- ---------- -------------
Total operating revenues....... 235,140 -- 235,140
--------- ---------- -------------
Operating expenses:
Cost of services................. 35,762 35,762
Cost of equipment................ 18,562 -- 18,562
Marketing and selling............ 34,957 -- 34,957
General and administrative....... 40,795 -- 40,795
Depreciation and amortization.... 100,020 100,020
--------- ---------- -------------
Total operating expenses....... 230,096 230,096
--------- ---------- -------------
Operating income................... 5,044 5,044
--------- ---------- -------------
Interest expense................... (82,365) 4,506 (1) (77,859)
Equity in loss of unconsolidated
subsidiary....................... -- (39,253)(2) (39,253)
Other income, net.................. 3,411 -- 3,411
--------- ---------- -------------
Loss before minority interests and
income taxes..................... (73,910) (34,747) (108,657)
Minority interests in income of
subsidiaries..................... (2,125) -- (2,125)
--------- ---------- -------------
Loss from continuing operations
before income taxes.............. (76,035) (34,747) (110,782)
Income tax benefit................. 28,892 (1,711)(3) 27,181
--------- ---------- -------------
Loss from continuing operations.... (47,143) (36,458) (83,601)
Dividends on preferred stock....... (50,513) 3,391 (4) (47,122)
--------- ---------- -------------
Loss from continuing operations
applicable to common
stockholders..................... $ (97,656) $ (33,067) $ (130,723)
========= ========== =============
Loss from continuing operations
applicable to common stockholders
per share........................ $ (1.78) $ (1.40)
========= =============
Supplemental loss from continuing
operations attributable to common
stockholders per share........... $ (2.03)(5)
=============
Weighted average shares
outstanding...................... 54,823,354 93,133,416
========== =============
</TABLE>
See accompanying notes to the unaudited pro forma consolidated statement of
operations.
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
NINE MONTHS ENDED SEPTEMBER 30, 1999
(1) This reflects:
- the elimination of $2.8 million of interest expense as a result of the
redemption of $159.7 million aggregate principal amount of our 11 3/4%
senior notes with proceeds from our new credit facility having an assumed
weighted average interest rate of 8% per annum (each 1/8% increase in the
assumed weighted average interest rate would increase interest expense by
$0.2 million for the nine month period presented);
- the elimination of $2.9 million of interest expense associated with the
repayment of $100.0 million of bank debt from a portion of the proceeds of
the sale of our 13% senior preferred stock; and
- the addition of $1.2 million of amortization of deferred financing costs
related to the new credit facility.
(2) The funding of the purchase price for the American Cellular acquisition will
come from a combination of equity contributions of $410.0 million by each of
AT&T Wireless and us, and by borrowings under the joint venture's $1.75
billion credit facility. The purchase price for American Cellular of
approximately $2.4 billion, including fees and expenses, is preliminarily
allocated as follows:
<TABLE>
<CAPTION>
SEPTEMBER 30, 1999
------------------
($ IN MILLIONS)
<S> <C>
Working capital........................................... $ 50.0
Property, plant and equipment............................. 175.0
Cellular license acquisition costs........................ 1,200.0
Goodwill.................................................. 900.0
Customer list............................................. 50.0
Other assets.............................................. 25.0
--------
Total purchase price.................................... $2,400.0
========
</TABLE>
Cellular license acquisition costs and goodwill are being amortized over 20
years. Our customer list is being amortized over five years.
<PAGE>
This adjustment reflects our 50% interest in the pro forma net loss of the
American Cellular joint venture. The reconciliation from the historical results
of operations for American Cellular to the pro forma loss is as follows:
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30, 1999
------------------
<S> <C>
Historical net loss of American Cellular.................... $(27,485)
Additional depreciation and amortization from purchase
price allocation...................................... (64,703)
Additional interest expense due to the increase in debt
incurred by the joint venture......................... (19,880)
Additional income tax benefit due to the increase in
losses................................................ 33,562
--------
Pro forma net loss of American Cellular..................... $(78,506)
--------
50% of the pro forma net loss of American Cellular.......... $(39,253)
========
</TABLE>
(3) This reflects the tax impact of the pro forma adjustments.
(4) This reflects:
- the elimination of $9.6 million of accrued dividends on our Class D
preferred stock associated with the conversion of our Class D preferred
stock into shares of our old Class A common stock and Class E preferred
stock and the redemption of our Class E preferred stock;
- the elimination of $3.1 million of preferred stock dividends associated
with the redemption of our Class F and G preferred stock; and
- the addition of $9.3 million of non-cash preferred stock dividend
requirements related to the issuance of our 13% senior preferred stock in
May 1999.
(5) Upon the conversion of our Class D preferred stock into old Class A common
stock and Class E preferred stock, as part of our recapitalization, and the
redemption of all of the then outstanding Class E preferred stock, we will
recognize a dividend on the Class E preferred stock of approximately $58.2
million. Had we reflected this dividend in the accompanying unaudited pro
forma consolidated financial statements for the nine months ended September
30, 1999, the loss from continuing operations applicable to common
stockholders would have been ($188.9 million) or ($2.03) per share.
<PAGE>
DOBSON COMMUNICATIONS CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
DOBSON
COMMUNICATIONS
CORPORATION SYGNET ADJUSTMENTS TOTAL
--------------- -------- ----------- ----------
($ IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
Operating revenues:
Service revenues............................ $ 69,402 $ 64,786 $ -- $ 134,188
Roaming revenues............................ 66,479 28,035 -- 94,514
Equipment sales and other revenues.......... 4,154 7,447 -- 11,601
----------- -------- --------- ----------
Total operating revenues.................. 140,035 100,268 -- 240,303
----------- -------- --------- ----------
Operating expenses:
Cost of services............................ 33,267 9,433 832 (1) 43,532
Cost of equipment........................... 8,360 10,444 -- 18,804
Marketing and selling....................... 22,393 12,327 2,603 (1) 37,323
General and administrative.................. 26,051 19,796 (3,435)(1) 42,412
Merger related costs........................ -- 1,884 (1,884)(2) --
Depreciation and amortization............... 47,110 27,498 43,308 (3) 117,916
----------- -------- --------- ----------
Total operating expenses.................. 137,181 81,382 41,424 259,987
----------- -------- --------- ----------
Operating income (loss)....................... 2,854 18,886 (41,424) (19,684)
----------- -------- --------- ----------
Interest expense.............................. (38,979) (27,895) (25,692)(4) (92,566)
Merger related costs.......................... -- (5,206) 5,206 (2) --
Equity in loss of unconsolidated subsidiary... -- -- (59,146)(5) (59,146)
Other income, net............................. 3,858 (319) -- 3,539
----------- -------- --------- ----------
Loss before minority interests and income
taxes....................................... (32,267) (14,534) (121,056) (167,857)
Minority interests in income of
subsidiaries................................ (2,487) -- -- (2,487)
----------- -------- --------- ----------
Loss from continuing operations before income
taxes....................................... (34,754) (14,534) (121,056) (170,344)
Income tax benefit............................ 11,469 -- 30,786 (6) 42,255
----------- -------- --------- ----------
Loss from continuing operations............... (23,285) (14,534) (90,270) (128,089)
Dividends on preferred stock.................. (23,955) -- (34,007)(7) (57,962)
----------- -------- --------- ----------
Loss from continuing operations applicable to
common stockholders......................... $ (47,240) $(14,534) $(124,277) $ (186,051)
=========== ======== ========= ==========
Loss from continuing operations applicable to
common stockholders per share............... $ (0.90) $ (2.00)
=========== ==========
Supplemental loss from continuing operations
attributable to common stockholders per
share....................................... $ (2.62)(8)
==========
Weighted average shares outstanding........... 52,773,972 93,133,416
=========== ==========
</TABLE>
See accompanying notes to the unaudited pro forma consolidated statement of
operations.
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 1998
(1) This reclassifies certain operating expenses of Sygnet to conform with our
historical presentation.
(2) This eliminates costs that Sygnet incurred related to the consummation of
our acquisition of Sygnet.
(3) This reflects the additional depreciation and amortization resulting from
the allocation of the purchase price attributable to the Sygnet acquisition
of property and equipment, cellular license acquisition costs and intangible
assets.
(4) This reflects:
- the elimination of $27.9 million of interest expense associated with
Sygnet's senior notes and Sygnet's bank facility that we repaid as part of
our acquisition of Sygnet;
- the addition of $64.4 million of interest expense and amortization of
deferred financing costs relating to the Sygnet acquisition;
- the elimination of $8.7 million of interest expense associated with the
repayment of existing bank debt from the proceeds of our May 1999 offering
of 13% senior preferred stock;
- the elimination of $3.7 million of interest expense as a result of the
redemption of $159.7 million aggregate principal amount of our 11 3/4%
senior notes with proceeds from our new credit facility having an assumed
interest rate of 8% per annum (each 1/8% increase in the assumed weighted
average interest rate would increase interest expense by $0.2 million per
annum); and
- the addition of $1.6 million of amortization of deferred financing costs
related to the new credit facility.
(5) This adjustment reflects our 50% interest in the pro forma net loss of the
American Cellular joint venture. The reconciliation from the historical
results of operations for American Cellular to the pro forma loss is as
follows:
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, 1998
-----------------
<S> <C>
Historical net loss of American Cellular.................... $ (40,399)
Historical net loss of PriCellular.......................... (6,286)
Additional depreciation and amortization from purchase
price allocation........................................ (86,270)
Additional interest expense due to increase debt borrowed
by the joint venture.................................... (33,568)
Additional income tax benefit due to the increase in
losses.................................................. 48,231
---------
Pro forma net loss of American Cellular..................... $(118,292)
---------
50% of the pro forma net loss of American Cellular.......... $ (59,146)
=========
</TABLE>
(6) This reflects the tax impact of the pro forma adjustments.
(7) This reflects adjustments to dividends resulting from our offerings and
redemption of preferred stock, including the amortization of the issuance
costs and the accretion of discounts with respect thereto, as follows:
- the addition of $23.8 million for our 13% senior preferred stock that we
offered in May 1999;
- the addition of $10.1 million for our 12 1/4% senior preferred stock that
we offered in December 1998;
- the addition of $0.9 million for our senior preferred stock that we
offered in January 1998; and
- the elimination of $0.8 million of dividends on the Class B and C
preferred stock that we redeemed in December 1998.
(8) Upon the conversion of our Class D preferred stock into old Class A common
stock and Class E preferred stock, as part of our recapitalization, and
the redemption of all of the then outstanding Class E preferred stock, we
will recognize a dividend on the Class E preferred stock of approximately
$58.2 million. Had we reflected this dividend in the accompanying
unaudited pro forma consolidated financial statements for the twelve
months ended December 31, 1998, the loss from continuing operations
applicable to common stockholders would have been ($244.3 million) or
($2.62) per share.
<PAGE>
DOBSON COMMUNICATIONS CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED BALANCE SHEET
AS OF SEPTEMBER 30, 1999
<TABLE>
<CAPTION>
DOBSON
COMMUNICATIONS
CORPORATION ADJUSTMENTS TOTAL
-------------- ----------- ----------
($ IN THOUSANDS)
<S> <C> <C> <C>
ASSETS
Current assets, net of
restricted investments...... $ 64,575 $ 81,201 (1) $ 145,776
Restricted investments........ 57,771 -- 57,771
Property, plant and
equipment................... 187,291 187,291
Receivable--affiliate......... 8,200 -- 8,200
Cellular license acquisition
cost........................ 1,227,579 1,227,579
Deferred financing costs...... 69,017 7,254 (2) 76,271
Other intangibles............. 48,139 -- 48,139
Investment in unconsolidated
subsidiary.................. -- 410,000 (1) 410,000
Other assets.................. 3,811 -- 3,811
---------- --------- ----------
Total assets.............. $1,666,383 $ 498,455 $2,164,838
========== ========= ==========
LIABILITIES AND STOCKHOLDERS'
EQUITY
---------- --------- ----------
Current liabilities........... $ 104,474 $ (9,984)(1) $ 94,490
Net liabilities of
discontinued operations..... 48,844 (48,844)(3) --
Long-term debt, net of current
portion..................... 1,039,844 44,400 (2) 1,084,244
Deferred credits.............. 216,563 -- 216,563
Minority interests............ 27,110 -- 27,110
Preferred stock............... 525,797 (85,000)(1) 440,797
Stockholders' (deficit)
equity...................... (296,249) 586,185 (1)
(37,146)(2)
48,844 (3) 301,634
---------- --------- ----------
Total liabilities and
stockholders' (deficit)
equity.................... $1,666,383 $ 498,455 $2,164,838
========== ========= ==========
</TABLE>
See accompanying notes to the unaudited pro forma
consolidated condensed balance sheet.
<PAGE>
NOTES TO THE UNAUDITED PRO FORMA CONSOLIDATED CONDENSED BALANCE SHEET
AS OF SEPTEMBER 30, 1999
(1) This reflects:
- this offering of Class A common stock;
- the concurrent offering of Class A common stock to AT&T Wireless;
- the conversion of each share of our Class D preferred stock into one share
of our old Class A common stock and one share of our Class E preferred
stock, the redemption of our Class E preferred stock, and the recognition
of the estimated dividend on the Class E preferred stock of approximately
$58.2 million; and
- our purchase of a 50% interest in the American Cellular joint venture.
(2) This reflects:
- the net impact of the elimination of deferred financing costs and our
tender premium associated with the retirement of $159.7 million aggregate
principal amount of our 11 3/4% senior notes with funds borrowed under our
new bank credit facility;
- the elimination of $8.7 million of deferred financing costs associated
with the refinancing of the credit facilities of our subsidiaries, Dobson
Operating Company and Dobson Cellular Operations Company, and our senior
notes; and
- the capitalization of $16.0 million of costs related to our new credit
facility.
(3) This reflects the distribution of all of the outstanding capital stock of
Logix to our current shareholders.
<PAGE>
(c) Exhibits
2.1 Agreement and Plan of Recapitalization among Dobson
Communications Corporation, Dobson Operating Company, Dobson
CC Limited Partnership, Russell L. Dobson, J.W. Childs Equity
Partners II, L.P., AT&T Wireless, Inc. and the other
stockholders of Dobson Communications Corporation's Class A
Common Stock and Class D Preferred Stock.
2.2 AT&T Stock Purchase Agreement.
3.1 Registrant's Amended and Restated Certificate of
Incorporation.
10.1 Second Amended and Restated Limited Liability Company
Agreement of ACC Acquisition LLC between AT&T Wireless JV
Co. and Dobson JV Company dated as of February 25, 2000.
10.1.1 Amended and Restated Supplemental Agreement among AT&T
Wireless, Dobson Communications Corporation, Dobson CC
Limited Partnership, and other signatories thereto, dated
February 25, 2000.
10.2 Amended and Restated Management Agreement between Dobson
Cellular Systems, Inc. and ACC Acquisition LLC dated as of
February 25, 2000.
10.3 Amended and Restated Operating Agreement dated February 25,
2000 by and between AT&T Wireless Services, Inc., on behalf
of itself and its Affiliate (as defined therein) and ACC
Acquisition L.L.C., on behalf of itself and its Affiliates
(as defined therein).
10.4 Amended and Restated Operating Agreement dated February 25,
2000 by and between Dobson Cellular Systems, Inc., on behalf
of itself and its Affiliates (as defined therein) and ACC
Acquisition L.L.C., on behalf of itself and its Affiliates
(as defined therein).
10.5* Dobson Communications Corporation 2000 Stock Incentive Plan.
23.1 Consent of Ernst & Young LLP (Chicago - American Cellular)
- --------------
* Management Contract or compensatory plan or arrangement.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DOBSON COMMUNICATIONS
CORPORATION
Date: March 09, 2000 By: /s/ Bruce R. Knooihuizen
-----------------------------
Bruce R. Knooihuizen
Executive Vice President
<PAGE>
EXHIBIT INDEX
Exhibits
2.1 Agreement and Plan of Recapitalization among Dobson
Communications Corporation, Dobson Operating Company, Dobson
CC Limited Partnership, Russell L. Dobson, J.W. Childs Equity
Partners II, L.P., AT&T Wireless, Inc. and the other
stockholders of Dobson Communications Corporation's Class A
Common Stock and Class D Preferred Stock.
2.2 AT&T Stock Purchase Agreement.
3.1 Registrant's Amended and Restated Certificate of
Incorporation.
10.1 Second Amended and Restated Limited Liability Company
Agreement of ACC Acquisition LLC between AT&T Wireless JV
Co. and Dobson JV Company dated as of February 25, 2000.
10.1.1 Amended and Restated Supplemental Agreement among AT&T
Wireless, Dobson Communications Corporation, Dobson CC
Limited Partnership, and other signatories thereto, dated
February 25, 2000.
10.2 Amended and Restated Management Agreement between Dobson
Cellular Systems, Inc. and ACC Acquisition LLC dated as of
February 25, 2000.
10.3 Amended and Restated Operating Agreement dated February 25,
2000 by and between AT&T Wireless Services, Inc., on behalf
of itself and its Affiliate (as defined therein) and ACC
Acquisition L.L.C., on behalf of itself and its Affiliates
(as defined therein).
10.4 Amended and Restated Operating Agreement dated February 25,
2000 by and between Dobson Cellular Systems, Inc., on behalf
of itself and its Affiliates (as defined therein) and ACC
Acquisition L.L.C., on behalf of itself and its Affiliates
(as defined therein).
10.5* Dobson Communications Corporation 2000 Stock Incentive Plan.
23.1 Consent of Ernst & Young LLP (Chicago - American Cellular)
- --------------
* Management Contract or compensatory plan or arrangement.
<PAGE>
AGREEMENT AND PLAN
OF
RECAPITALIZATION
This AGREEMENT AND PLAN OF RECAPITALIZATION (the "Agreement") is made and
entered into among DOBSON COMMUNICATIONS CORPORATION, an Oklahoma corporation
("DCC"), DOBSON OPERATING CO., L.L.C., an Oklahoma limited liability company and
a wholly-owned subsidiary of DCC ("DOCLLC"), DOBSON CC LIMITED PARTNERSHIP, an
Oklahoma limited partnership ("DCCLP"), RUSSELL L. DOBSON, an individual
("Dobson"), J.W. CHILDS EQUITY PARTNERS II, L.P., a Delaware limited partnership
("Childs"), AT&T WIRELESS SERVICES, INC., a Delaware corporation ("AT&T") and
the holders of issued and outstanding shares of DCC's Class A Common Stock, par
value $.001 per share ("Old Class A Common Stock") and Class D Preferred Stock,
par value $1.00 per share ("Class D Preferred Stock") listed on Schedule A
annexed hereto (the "JWC Group Stockholders" and, together with DOCLLC, DCCLP,
Dobson, Childs, and AT&T, the "Stockholders").
RECITALS
1. DCC has an authorized capital consisting of 3,000,000 shares of
preferred stock, par value $1.00 per share ("Preferred Stock"), and 1,500,000
shares of common stock, par value $.001 per share ("Old Common Stock"). The
following reflects the classes of DCC's Preferred Stock and Old Common Stock,
including the number of shares designated for each class and the number of
shares of each class outstanding at January 3, 2000.
<TABLE>
<CAPTION>
NUMBER OF SHARES
------------------------
CLASS OF STOCK AUTHORIZED OUTSTANDING
-------------- ---------- -----------
<S> <C> <C>
Class A 5% Non-Cumulative, Non-Voting, Non-
Convertible Preferred Stock ("Class A
Preferred Stock")............................. 450,000 314,286
Class D Preferred Stock......................... 90,000 75,093.7
Class E Preferred Stock ("Class E Preferred
Stock")....................................... 517,000 0
12 1/4% Senior Exchangeable Preferred Stock
(12 1/4% Senior Preferred Stock).............. 734,000 287,602
13% Senior Exchangeable Preferred Stock due
2009 ("13% Senior Preferred Stock")........... 500,000 181,229
Other Preferred Stock........................... 709,000 0
Class A Common Stock, par value $.001 per
share ("Old Class A Common Stock")............ 1,438,000 491,954
Class B Common Stock, par value $.001 per
share ("Old Class B Common Stock")............ 31,000 0
<PAGE>
Class C Common Stock, par value $.001 per
share ("Class C Common Stock") ............... 31,000 0
</TABLE>
2. DCC intends to effect an initial public offering ("IPO") of its New
Class A Common Stock (defined below). In order to effect its IPO, DCC must
complete a recapitalization to simplify its corporate structure to position
itself for its IPO.
3. DCC has filed a registration statement on Form S-1 with the Securities
and Exchange Commission (Registration File No. 333-90759) with respect to its
IPO, which has been amended but which has not yet become effective (the
"Registration Statement").
4. DCC and the Stockholders have agreed to the plan of recapitalization
for DCC as set forth herein to facilitate the IPO and have agreed to effect the
transactions provided for herein.
AGREEMENTS
In consideration of the mutual covenants, promises, benefits and burdens
herein set forth, and in order to effect the recapitalization of DCC, the
parties agree as follows:
1. CLASS A PREFERRED STOCK. DOCLLC is the beneficial owner of all of the
outstanding shares of Class A Preferred Stock. DOCLLC agrees that immediately
prior to the Effective Time (defined below) it will distribute all of the Class
A Preferred Stock which it beneficially owns to DCC. Upon receipt of the Class
A Preferred Stock, DCC shall cancel and retire all outstanding shares of its
Class A Preferred Stock.
2. CLASS D PREFERRED STOCK. Each holder of outstanding shares of Class D
Preferred Stock represents that it is the beneficial owner of shares of Class D
Preferred Stock. Each such holder acknowledges that pursuant to the Certificate
of Designation, Preferences and Relative and Other Special Rights, and
Qualifications, Limitations and Restrictions of Class D Preferred Stock, each
share of Class D Preferred Stock is convertible into one share of Old Class A
Common Stock and one share of DCC's Class E Preferred Stock, subject to
appropriate anti-dilution adjustment as provided in the Certificate of
Designation. Each such holder agrees that immediately prior to the Effective
Time (defined below) it will convert each such share of Class D Preferred Stock
into shares of Old Class A Common Stock and Class E Preferred Stock, as provided
in the Certificate of Designation. Each such holder's execution of this
Agreement constitutes the irrevocable election by the holder to convert each
share of Class D Preferred Stock beneficially owned by such holder into one
share of Class E Preferred Stock and one share of Old Class A Common Stock,
subject to appropriate anti-dilution adjustment as provided in the Certificate
of Designation to be effective and operative immediately prior to the Effective
Time.
3. AMENDMENT TO CERTIFICATE OF INCORPORATION. DCC agrees to amend and
restate its Certificate of Incorporation (the "New Certificate of
Incorporation") so that DCC will be authorized to issue an aggregate of
251,037,226 shares of capital stock, which shall consist of:
A. 175 million shares of Class A Common Stock, par value $.001 per
share ("New Class A Common Stock");
-2-
<PAGE>
B. 70 million shares of Class B Common Stock, par value $.001 per
share ("New Class B Common Stock");
C. 6 million shares of Preferred Stock, par value $1.00 per share,
of which 734,000 shares shall be designated as 12 1/4% Senior
Exchangeable Preferred Stock 500,000 shares shall be designated
as 13% Senior Exchangeable Preferred Stock , and 40,000 shares
shall be designated as Class E Preferred Stock;
D. 4,226 shares of Class C Common Stock, par value $.001 per share
("Class C Common Stock"); and
E. 33,000 shares of Class D Common Stock, par value $.001 per share
("New Class D Common Stock").
The form of DCC's proposed New Certificate of Incorporation, including the
terms, rights, powers and preferences of DCC's authorized capital stock, is
attached as Schedule B and incorporated herein by this reference.
DCC shall file the New Certificate of Incorporation with the Secretary of
State of Oklahoma so that the New Certificate of Incorporation will become
effective immediately prior to the consummation of the IPO. The time that the
New Certificate of Incorporation becomes effective is herein referred to as the
"Effective Time."
4. REDESIGNATION OF OLD CLASS B COMMON STOCK. The authorized shares of
Old Class B Common Stock will be redesignated as New Class D Common Stock.
5. RECLASSIFICATION OF OLD CLASS A COMMON STOCK, OLD CLASS B COMMON STOCK
AND CLASS C COMMON STOCK; STOCK SPLIT. At the Effective Time, (a) each share of
Old Class A Common Stock, par value $.001 per share, outstanding immediately
prior to the Effective Time shall be, without further action by the Corporation
or any holder thereof, changed, converted and reclassified into a number of
shares of New Class B Common Stock equal to the number of shares representing a
111.44 to 1 stock split for each share (the "Class A Conversion Factor"), and
each certificate then outstanding stating on its face that it represents shares
of Old Class A Common Stock existing prior to the Effective Time, shall
automatically represent, from and after the Effective Time, a number of shares
of New Class B Common Stock equal to the number of shares on the face of the
certificate of Old Class A Common Stock existing prior to the Effective Time
multiplied by the Class A Conversion Factor; (b) each share of Old Class B
Common Stock, par value $.001 per share, outstanding immediately prior to the
Effective Time shall be, without further action by the Corporation or any holder
thereof, changed, converted and reclassified into a number of shares of newly
authorized New Class A Common Stock equal to the number of shares representing a
111.44 to 1 stock split for each share (the "Class B Conversion Factor"), and
each certificate then outstanding stating on its face that it represents shares
of Old Class B Common Stock existing prior to the Effective Time, shall
automatically represent, from and after the Effective Time, a number of shares
of New Class A Common Stock equal to the number of shares on the face of the
certificate of Class A Common Stock existing prior to the Effective Time
multiplied by the Class B Conversion Factor, and (c) each share of
-3-
<PAGE>
Class C Common Stock, par value $.001 per share, outstanding immediately
prior to the Effective Time shall be, without further action by the
Corporation or any holder thereof, changed, converted and reclassified into a
number of shares of New Class A Common Stock equal to the number of shares
representing a 11.44 to 1 stock split for each share (the "Class C Conversion
Factor"), and each certificate then outstanding stating on its face that it
represents shares of Class C Common Stock existing prior to the Effective
Time, shall automatically represent, from and after the Effective Time, a
number of shares of New Class A Common Stock equal to the number of shares on
the face of the certificate of Class C Common Stock existing prior to the
Effective Time multiplied by the Conversion Factor.
6. FRACTIONAL SHARES. In connection with the stock split described in
Section 5 above, no fractional shares of Class A Common Stock or Class B Common
Stock shall be issued. Instead, any fractional shares of New Class A Common
Stock or New Class B Common Stock which would otherwise be issued shall be
rounded to the nearest whole share.
7. OUTSTANDING OPTIONS. DCC has heretofore reserved an aggregate of
31,000 shares of its Old Class B Common Stock and 31,000 shares of its Class C
Common Stock for issuance upon the exercise of options granted and to be granted
under its 1996 Stock Option Plan, as amended (the "Plan"). At the Effective
Time, Old Class B Common Stock shall be redesignated as New Class D Common
Stock. The aggregate number of shares of New Class D Common Stock (formerly Old
Class B Common Stock) reserved for issuance under the Plan shall be 33,000
shares. The number of shares of Class C Common Stock reserved for issuance under
the Plan shall be 4,226 shares.
8. RETIREMENT OF TREASURY STOCK. Immediately prior to the Effective
Time, DCC shall retire 81,198 shares of its Old Class A Common Stock currently
issued but not outstanding and held as treasury stock.
9. STOCKHOLDER ACTION. The execution and delivery of this Agreement by a
Stockholder shall be deemed a waiver of a notice of a meeting of stockholders of
DCC for the purpose of considering and voting on the transactions provided for
herein or contemplated hereby, and shall constitute the consent of each such
Stockholder to all such transactions.
10. MISCELLANEOUS.
10.1 SURVIVAL. All covenants, agreements, representations and
warranties made herein shall survive the execution and delivery of this
Agreement. Whenever in this Agreement any of the parties hereto is referred to,
such reference shall be deemed to include the successors and assigns of such
party.
10.2. CUMULATIVE REMEDIES. No failure on the part of any party to
exercise and no delay in exercising any right hereunder will operate as a waiver
thereof, nor shall any single or partial exercise by any party of any right
hereunder preclude any other or further right of exercise thereof or the
exercise of any other right.
10.3. EXPENSES. Each party agrees to pay all his, her or its expenses
incurred in connection with the transaction herein contemplated, including,
without limitation, all filing fees, recording costs, safekeeping fees, charges
and disbursements of legal counsel.
-4-
<PAGE>
10.4. NOTICES. All notices, requests and demands hereunder will be
served by registered or certified mail, postage prepaid, as follows:
Russell L. Dobson: 13439 N. Broadway Extension, Suite 200
Oklahoma City, Oklahoma 73114
DCC, DOCLLC, and DCCLP: c/o Mr. Everett R. Dobson
Dobson Communications Corporation
13439 N. Broadway Extension, Suite 200
Oklahoma City, Oklahoma 73114
With a copy to: McAfee & Taft A Professional Corporation
10th Fl., Two Leadership Square
211 North Robinson
Oklahoma City, Oklahoma 73102
Attn: Theodore M. Elam, Esq.
Childs: c/o Mr. Dana L. Schmaltz
J.W. Childs Associates, L.P.
One Federal Street, 21st Floor
Boston, Massachusetts 02110
AT&T: AT&T Wireless Services, Inc.
7277 164th Avenue, N.E.
Redmond, Washington 98052
JWC Group Stockholders: c/o Dana L. Schmaltz, as agent and
attorney-in-fact
J.W. Childs Associates, L.P.
One Federal Street, 21st Floor
Boston, Massachusetts 02110
or at such other address as any party hereto shall designate for such purpose in
a written notice to the other parties hereto.
10.5. CONSTRUCTION. This Agreement and the documents issued hereunder
are executed and delivered as an incident to a transaction negotiated and to be
performed in Oklahoma City, Oklahoma County, Oklahoma. The descriptive headings
of the paragraphs of this Agreement are for convenience only and are not to be
used in the construction of the content of this Agreement. This Agreement may
be executed in multiple counterparts, each of which will be an original
instrument, but all of which will constitute one agreement.
10.6. SUBMISSION TO JURISDICTION; VENUE. Each of the parties hereto
hereby irrevocably: (a) submits and consents, and waives any objection to
personal jurisdiction in the State of Oklahoma for the enforcement of this
Agreement; and (b) waives any and all personal rights under the law of any state
to object to jurisdiction in the State of Oklahoma for the purpose of litigation
to enforce this Agreement.
-5-
<PAGE>
10.7. WAIVER OF JURY TRIAL. TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY AND EXPRESSLY
WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING, OR COUNTERCLAIM
(WHETHER BASED UPON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY.
10.8. BINDING EFFECT. This Agreement will be binding on each of the
parties hereto, and his/her or its heirs, representatives, successors and
assigns, and will inure to the benefit of each of the parties hereto, his, her
or its heirs, representatives, successors and assigns.
10.9. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement among the parties hereto and may be amended only by written instrument
executed by the parties hereto.
-6-
<PAGE>
10.10. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute but one agreement.
IN WITNESS WHEREOF, this instrument is executed as of January ___, 2000.
DCC: DOBSON COMMUNICATIONS CORPORATION
By /s/ Ronald L. Ripley
---------------------------------------------
Ronald L. Ripley, Vice President
DOCLLC: DOBSON OPERATING CO., L.L.C.
By /s/ Ronald L. Ripley
---------------------------------------------
Ronald L. Ripley, Assistant General Manager
DCCLP: DOBSON CC LIMITED PARTNERSHIP
By: RLD, INC., General Partner
By /s/ Everett Dobson
-----------------------------------------
Name: Everett Dobson
Title: President
DOBSON:
/s/ Russell L. Dobson
-----------------------------------------------
Russell L. Dobson
-7-
<PAGE>
CHILDS: J.W. CHILDS EQUITY PARTNERS II, L.P.
JWC Associates, Inc., General Partner
By: J.W. Childs Advisors, II, L.P.,
its general partner
By: J.W. Childs Associates, L.P.,
its general partner
By: J.W. Childs Associates, Inc.,
its general partner
By /s/ Dana L. Schmaltz
---------------------------------------
Dana L. Schmaltz, Vice President
-8-
<PAGE>
AT&T: AT&T WIRELESS SERVICES, INC.
By /s/ William W. Hague
-------------------------------------------
William W. Hague
Title: Senior Vice President
-------------------------------------
-9-
<PAGE>
JWC GROUP STOCKHOLDERS: BOCK FAMILY TRUST
By /s/ John V. Bock, Jr.*
John V. Bock, Jr., Trustee
/s/ John W. Childs*
John W. Childs
/s/ Richard S. Childs*
Richard S. Childs
/s/ James E. Childs*
James E. Childs
/s/ Timothy J. Healy*
Timothy J. Healy
/s/ Samuel A. Anderson*
Samuel A. Anderson
/s/ Glenn A. Hopkins*
Glenn A. Hopkins
/s/ Jerry D. Horn*
Jerry D. Horn
/s/ B. Lane MacDonald*
B. Lane MacDonald
/s/ Raymond B. Rudy*
Raymond B. Rudy
-10-
<PAGE>
/s/ Dana L. Schmaltz
---------------------------------------
Dana L. Schmaltz
CHECHESSE CREEK TRUST
By /s/ Dana L. Schmaltz
-------------------------------------
Dana L. Schmaltz, Trustee
/s/ Steven G. Segal*
Steven G. Segal
SGS 1995 FAMILY LIMITED PARTNERSHIP
By /s/ Steven G. Segal*
Steven G. Segal, General Partner
STEVEN G. SEGAL 1995 IRREVOCABLE TRUST
By /s/ Steven G. Segal*
Steven G. Segal, Donor
SGS III 1995 FAMILY LIMITED PARTNERSHIP
By /s/ Steven G. Segal*
Steven G. Segal, General Partner
/s/ Adam L. Suttin*
Adam L. Suttin
-11-
<PAGE>
ADAM L. SUTTIN IRREVOCABLE FAMILY TRUST
By /s/ Hope Suttin*
Hope Suttin, Trustee
SUTTIN FAMILY TRUST II
By Adam L. Suttin*
Adam L. Suttin, Trustee
EUGENE SUTTIN SELF DIRECTED CUSTODIAL IRA
By /s/ Samuel A. Katz*
Samuel A. Katz, Vice President, Trust
Bank of _______________
/s/ Edward D. Yun*
Edward D. Yun
YUN FAMILY TRUST
By /s/ Edward D. Yun*
Edward D. Yun, Trustee
/s/ Bob Elman*
Bob Elman
/s/ Edwin J. Kozlowski*
Edwin J. Kozlowski
/s/ James D. Murphy*
James D. Murphy
-12-
<PAGE>
REBACLIFF, BAKER & DOBBS, LLC
By /s/ Michael A. Smart*
Michael A. Smart, Member
/s/ Benno C. Schmidt, Jr.*
Benno C. Schmidt, Jr.
/s/ Mario Soussou*
Mario Soussou
/s/ William E. Watts*
William E. Watts
OFS INVESTMENT PARTENRS II
By /s/ Allan A. Dowds*
Allan A. Dowds, Administrative
Managing Partner
* /s/ Dana L. Schmaltz
--------------------------------------------
Dana L. Schmaltz, as agent and attorney-in-
fact for the JWC Group Stockholders under
the Stockholder Appointment of Agent and
Power of Attorney, and not in his individual
capacity
-13-
<PAGE>
SCHEDULE A
Shareholder
J.W. Childs Equity Partners II, L.P.
Bock Family Trust
John W. Childs
Richard S. Childs
James E. Childs
Samuel A. Anderson
Timothy J. Healy
Glenn A. Hopkins
Jerry D. Horn
B. Lane MacDonald
Raymond B. Rudy
Dana L. Schmaltz
Chechesse Creek Trust
Steven G. Segal
SGS 1995 Family Limited Partnership
Steven G. Segal 1995 Irrevocable Trust
SGS III 1995 Family Limited Partnership
Adam L. Suttin
Adam L. Suttin Irrevocable Family Trust
Suttin Family Trust II
Eugene Suttin Self Directed Custodial IRA
Edward D. Yun
Yun Family Trust
Bob Elman
Edward J. Kozlowski
James D. Murphy
Rebacliff, Baker & Dobbs, L.L.C.
Benno C. Schmidt, Jr.
Mario Soussou
William E. Watts
OFS Investment Partners II
-14-
<PAGE>
1,500,000 SHARES
DOBSON COMMUNICATIONS CORPORATION
CLASS A COMMON STOCK, PAR VALUE $0.001 PER SHARE
STOCK PURCHASE AGREEMENT
February 4, 2000
AT&T Wireless Services, Inc.
7277 164th Avenue, N.E.
Redmond, WA 98052
Dear Sirs:
Dobson Communications Corporation, an Oklahoma corporation (the
"Company"), proposes to sell to AT&T Wireless Services, Inc. ("AWS")
1,500,000 shares (the "Stock") of the Company's Class A Common Stock, par
value $0.001 per share (the "Class A Common Stock"). This is to confirm the
agreement concerning the purchase of the Stock from the Company by AWS.
Capitalized terms used but not defined herein have the meanings given to such
terms in the Underwriting Agreement dated as of the date hereof (the
"Underwriting Agreement") between the Company and the underwriters named
therein.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY.
The Company represents, warrants and agrees that:
(a) The Registration Statement and the Prospectus conform, and any
post-effective amendments or supplements to the Registration Statement or the
Prospectus did, when they became effective or were filed with the Commission,
as the case may be, conform in all respects to the requirements of the
Securities Act and the Rules and Regulations and did not, as of the effective
date (as to the Registration Statement and any pre-effective amendment
thereto) and as of the applicable filing date with respect to any
post-effective amendment to the Registration Statement, and as to the
Prospectus, and any amendment or supplement thereto, contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein (in the case of
the Prospectus, in light of the circumstances under which they were made) not
misleading.
(b) The shares of the Stock to be issued and sold by the Company
to AWS hereunder have been duly authorized and, when issued and delivered
against payment therefor as provided herein, will be validly issued, fully
paid and non-assessable
<PAGE>
and the Stock will conform, in all material respects, to the description
thereof contained in the Prospectus. The certificates for the Class A Common
Stock are in valid and sufficient form.
(c) This Agreement has been duly authorized, executed and
delivered by the Company and (assuming the due authorization, execution and
delivery thereof by AWS) constitutes the legal, valid and binding agreement
of the Company enforceable against it in accordance with its terms, subject
to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered
in a proceeding in equity or at law) or an implied covenant of good faith and
fair dealing.
(d) The execution, delivery and performance of this Agreement by
the Company and the consummation of the transactions contemplated hereby, by
the Company's amended and restated certificate of incorporation and by the
Agreement and Plan of Recapitalization, dated as of January 31, 2000, among
the Company, Dobson Operating Company, Dobson CC Limited Partnership, Russell
L. Dobson, J.W. Childs Equity Partners II, L.P., AT&T Wireless Services, Inc.
and the holders of issued and outstanding shares of the Company's
pre-recapitalization Class A Common Stock, par value $.001 per share, and
Class D Preferred Stock, par value $1.00 per share, listed on the signature
pages therein (the "Recapitalization Agreement"), providing for the
recapitalization described in the Prospectus under the captions
"Capitalization", "The Recapitalization" and "Description of Capital Stock"
(such actions are herein collectively called the "Recapitalization"): (i)
will not conflict with or result in a breach or violation of any of the terms
or provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which the Company or any
of its subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, except for such conflicts,
breaches or violations that, individually or in the aggregate, would not have
a Material Adverse Effect; (ii) will not result in any violation of the
provisions of the charter or by-laws of the Company or any of its
subsidiaries; (iii) will not result in any violation of any statute or any
order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties or assets, except for such violations that, individually or in the
aggregate, would not have a Material Adverse Effect; and (iv) except for the
registration of the Stock under the Securities Act and such consents,
approvals, authorizations, registrations or qualifications as may be required
(a) under the Securities Exchange Act of 1934, as amended, (b) by applicable
state or foreign securities laws in connection with the purchase of the Stock
by AWS and (c) by the National Association of Securities Dealers, Inc., will
not require any consent, approval, authorization or order of, or filing or
registration with, any such court or governmental agency or body for the
execution, delivery and performance of this Agreement by the Company and the
consummation of the transactions contemplated hereby and by the
Recapitalization.
(e) There are no contracts, agreements or understandings between
the Company and its subsidiaries and any other person that would give rise to
a valid claim
2
<PAGE>
against the Company or any of its subsidiaries or AWS for a brokerage
commission, finder's fee or like payment in connection with the issuance,
purchase and sale of the Stock.
(f) There are no transfer taxes or other similar fees or charges
under federal law or the laws of any state or foreign jurisdiction, or any
political subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance by the Company or
sale by the Company of the Stock.
(g) At the First Delivery Date the Company's amended and restated
certificate of incorporation providing for the Recapitalization as described
in the Prospectus will have been duly filed with the Secretary of State of
the State of Oklahoma and the Recapitalization will have become effective.
(h) (i) The Recapitalization Agreement, the Agreement and Plan of
Merger, dated October 5, 1999, among ACC Acquisition LLC, ACC Acquisition Co.
and American Cellular Corporation (the "Merger Agreement"), the Amended and
Restated Limited Liability Company Agreement of ACC Acquisition LLC, dated as
of January 31, 2000, between AT&T Wireless Services JV Co., Dobson JV Company
and ACC Acquisition LLC (the "LLC Agreement"), the Operating Agreement, dated
as of January 31, 2000, among AT&T Wireless Services, Inc. and its
affiliates, and ACC Acquisition LLC, on behalf of American Cellular
Corporation and its affiliates (the "Operating Agreement"), and the
Management Agreement, dated as of January 31, 2000, between Dobson Cellular
Systems, Inc. and ACC Acquisition LLC, (the "Management Agreement" and,
together with the Merger Agreement, the Operating Agreement, the Management
Agreement and the LLC Agreement, the "American Cellular Agreements") are in
full force and effect and no party to the Recapitalization Agreement or any
of the American Cellular Agreements has sought to modify, amend or waive any
of the provisions thereof; (ii) the representations and warranties of the
Company, and to the knowledge of the Company the representations and
warranties of the other parties to the Recapitalization Agreement and the
American Cellular Agreements, contained in the Recapitalization Agreement and
the American Cellular Agreements, respectively, were true and correct in all
respects as of the dates of the Recapitalization Agreement and the American
Cellular Agreements, respectively, and as of the date hereof; the Company is
not, and to the knowledge of the Company, no other party to the
Recapitalization Agreement or any of the American Cellular Agreements is in
breach of any of the terms thereof; (iii) except as disclosed in or
contemplated by the Recapitalization Agreement or any of the American
Cellular Agreements, no consent, approval, authorization or order of, or
filing or registration with, any court or governmental agency or body was
required for the execution and delivery of, or is required for the
performance of, the Recapitalization Agreement or any of the American
Cellular Agreements by any of the parties thereto and the consummation of the
transactions contemplated thereby; and (iv) other than the American Cellular
Agreements, there are no other material agreements relating to the Company's
proposed joint venture with AWS or to acquire American Cellular Corporation.
3
<PAGE>
2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF AWS. AWS
represents, warrants and agrees that:
(a) The execution and delivery of this Agreement by it and the
consummation of the transactions contemplated hereby by it have been duly and
validly authorized by its board of directors and no other proceedings on its
part which have not been taken are necessary to authorize this Agreement or
to consummate the transactions contemplated hereby.
(b) This Agreement has been duly executed and delivered by it and
(assuming the due authorization, execution and delivery thereof by the
Company) constitutes its valid and binding obligation, enforceable against it
in accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting or
relating to enforcement of creditors' rights generally and may be subject to
general principles of equity.
(c) It has not employed any broker, finder or investment banker or
incurred any liability for any brokerage fees, commissions or finder's fees
in connection with the transactions contemplated hereby.
(d) It is not relying on and acknowledges that no representation
is being made by the Company or any of its officers, employees, affiliates,
agents or representatives, except for representations and warranties
expressly set forth in this Agreement, information set forth in the
Registration Statement, and such information and documents obtained by it as
a stockholder of the Company and through its representatives who serve as
members of the Company's board of directors, as the case may be.
3. PURCHASE OF THE STOCK BY AWS; DELIVERY AND PAYMENT. On the
basis of the representations and warranties contained in, and subject to the
terms and conditions of, this Agreement, the Company agrees to sell to AWS,
and AWS agrees to purchase from the Company, 1,500,000 shares of the Stock.
The price of the Stock shall be $20.735 per share. Delivery of and payment
for the Stock shall be made at the office of Weil, Gotshal & Manges LLP, 767
Fifth Avenue, New York, New York 10153 at 10:00 a.m., New York City time, on
the First Delivery Date. On the First Delivery Date, the Company shall
deliver or cause to be delivered a certificate representing the Stock to AWS
against payment to or upon the order of the Company of the purchase price by
wire transfer in immediately available funds. Upon delivery, the Stock shall
be registered in the name of AWS.
4. EXPENSES. The Company agrees to pay (a) the costs incident to
the authorization, issuance, sale and delivery of the Stock and any taxes
payable in that connection and (b) all other costs and expenses incident to
the performance of the obligations of the Company under this Agreement;
provided that AWS shall pay its own costs and expenses, including the costs
and expenses of its counsel.
5. CONDITION OF AWS' OBLIGATIONS. The obligations of AWS
hereunder are subject to the accuracy, when made and on the First Delivery
Date, of the
4
<PAGE>
representations and warranties of the Company contained herein, to the
performance by the Company of its obligations hereunder, and to each of the
following additional terms and conditions:
(a) All corporate proceedings and other legal matters incident to
the authorization, form and validity of this Agreement, the Stock, the
Registration Statement and the Prospectus, and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall be
reasonably satisfactory in all material respects to counsel for AWS, and the
Company shall have furnished to such counsel all documents and information
that they may reasonably request to enable them to pass upon such matters.
(b) McAfee & Taft A Professional Corporation, shall have furnished
to AWS their written opinion, as counsel to the Company, addressed to AWS and
dated the First Delivery Date, in the form of the opinion delivered to the
Underwriters pursuant to Section 9(d) of the Underwriting Agreement.
(c) Wilkinson Barker Knauer, LLP shall have furnished to AWS their
written opinion, as regulatory counsel to the Company, addressed to AWS and
dated the First Delivery Date, in the form of the opinion delivered to the
Underwriters pursuant to Section 9(f) of the Underwriting Agreement.
(d) The Company shall have furnished to AWS a certificate, dated
the First Delivery Date, of its Chairman of the Board, its President or a
Vice President and its Chief Financial Officer, in the form of the
certificate delivered to the Underwriters pursuant to Section 9(l) of the
Underwriting Agreement.
6. INDEMNIFICATION AND CONTRIBUTION.
(a) AWS shall indemnify and hold harmless the Company and its
affiliates, directors, shareholders, officers, employees, agents and/or the
legal representatives of any of them (each, a "Section 6(a) Indemnified
Party"), against all liabilities and expenses (including amounts paid in
satisfaction of judgments, in compromise, as fines and penalties, and as
counsel fees) (collectively, "Losses") incurred by him/her or it in
connection with the investigation, defense, or disposition of any action,
suit or other proceeding in which any Section 6(a) Indemnified Party may be
involved or with which he/she or it may be threatened (whether arising out of
or relating to matters asserted by third parties against a Section 6(a)
Indemnified Party or incurred or sustained by such party in the absence of a
third-party claim), that arises out of or results from (a) any representation
or warranty of AWS contained herein being untrue in any material respect as
of the date on which it was made or (b) any material default by such
indemnifying party or any of its affiliates in the performance of their
respective obligations herein, except to the extent (but only to the extent)
any such Losses arise out of or result from the gross negligence or willful
misconduct of such Section 6(a) Indemnified Party or its affiliates.
5
<PAGE>
(b) The Company shall indemnify and hold harmless AWS and its
affiliates, directors, shareholders, officers, employees, agents and/or the
legal representatives of any of them (each, a "Section 6(b) Indemnified
Party"), against all Losses incurred by him/her or it in connection with the
investigation, defense, or disposition of any action, suit or other
proceeding in which any Section 6(b) Indemnified Party may be involved or
with which he/she or it may be threatened (whether arising out of or relating
to matters asserted by third parties against a Section 6(b) Indemnified Party
or incurred or sustained by such party in the absence of a third-party
claim), that arises out of or results from (a) any representation or warranty
of the Company contained herein being untrue in any material respect as of
the date on which it was made or (b) any material default by the Company or
any of its affiliates in the performance of their respective obligations
herein, except to the extent (but only to the extent) any such Losses arise
out of or result from the gross negligence or willful misconduct of such
Section 6(b) Indemnified Party or its affiliates.
(c) (i) The terms of this Section 6(c) shall apply to any claim
(a "Claim") for indemnification under the terms of Sections 6(a) or 6(b).
The Section 6(a) Indemnified Party or Section 6(b) Indemnified Party (each,
an "Indemnified Party"), as the case may be, shall give prompt written notice
of such Claim to the indemnifying party (the "Indemnifying Party") under the
applicable Section, which party may assume the defense thereof, PROVIDED that
any delay or failure to so notify the Indemnifying Party shall relieve the
Indemnifying Party of its obligations hereunder only to the extent, if at
all, that it is materially prejudiced by reason of such delay or failure.
The Indemnified Party shall have the right to approve any counsel selected by
the Indemnifying Party and to approve the terms of any proposed settlement,
such approval not to be unreasonably delayed or withheld (unless, in the case
of approval of a proposed settlement, such settlement provides only, as to
the Indemnified Party, the payment of money damages actually paid by the
Indemnifying Party and a complete release of the Indemnified Party in respect
of the claim in question). Notwithstanding any of the foregoing to the
contrary, the provisions of this Section 6 shall not be construed so as to
provide for the indemnification of any Indemnified Party for any liability to
the extent (but only to the extent) that such indemnification would be in
violation of applicable law or that such liability may not be waived,
modified or limited under applicable law, but shall be construed so as to
effectuate the provisions of this Section 6 to the fullest extent permitted
by law.
(ii) In the event that the Indemnifying Party undertakes the
defense of any Claim, the Indemnifying Party will keep the Indemnified
Party advised as to all material developments in connection with such
Claim, including, but not limited to, promptly furnishing the Indemnified
Party with copies of all material documents filed or served in connection
therewith.
(iii) In the event that the Indemnifying Party fails to assume
the defense of any Claim within ten business days after receiving written
notice thereof, the Indemnified Party shall have the right, subject to the
Indemnifying Party's right to assume the defense pursuant to the
6
<PAGE>
provisions of this Section 6, to undertake the defense, compromise or
settlement of such Claim for the account of the Indemnifying Party.
Unless and until the Indemnifying Party assumes the defense of any
Claim, the Indemnifying Party shall advance to the Indemnified Party any
of its reasonable attorneys' fees and other costs and expenses incurred
in connection with the defense of any such action or proceeding. Each
Indemnified Party shall agree in writing prior to any such advancement
that, in the event he or it receives any such advance, such Indemnified
Party shall reimburse the Indemnifying Party for such fees, costs and
expenses to the extent that it shall be determined that he or it was not
entitled to indemnification under this Section 6.
(iv) In no event shall an Indemnifying Party be required to pay
in connection with any Claim for more than one firm of counsel (and local
counsel) for each of the following groups of Indemnified Parties: (A) AWS,
its affiliates, directors, shareholders, officers, employees, agents and/or
the legal representatives of any of them; and (B) the Company, its
affiliates, directors, shareholders, officers, employees, agents and/or the
legal representatives of any of them.
7. TERMINATION. The obligations of AWS hereunder may be
terminated by AWS by notice given to and received by the Company prior to
delivery of and payment for the Stock if the First Delivery Date does not
occur prior to March 31, 2000.
8. NOTICES, ETC. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to AWS, shall be delivered or sent by mail, telex or
facsimile transmission to AT&T Wireless Services, Inc., 7277 164th Ave.,
N.E., Redmond, Washington 98052, Attention: William W. Hague (Fax:
425-580-8405); with a copy to Friedman Kaplan & Seiler LLP, 875 Third Avenue,
New York, New York 10022, Attention: Matthew S. Haiken, Esq. (Fax:
212-355-6401); and
(b) if to the Company, shall be delivered or sent by mail, telex
or facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: Bruce R. Knooihuizen, Vice President -
Chief Financial Officer / Ronald L. Ripley, Vice President - Senior Corporate
Counsel (Fax: 405-529-8515); with a copy to McAfee & Taft A Professional
Corporation, 211 North Robinson, Suite 1000, Oklahoma City, Oklahoma 73102,
Attention: Theodore M. Elam, Esq. (Fax: 405-235-0439).
Any such statements, requests, notices or agreements shall take effect at the
time of receipt thereof.
9. BENEFICIARIES OF AGREEMENT. The representations, warranties,
covenants and agreements contained in this Agreement are for the sole benefit
of the
7
<PAGE>
parties hereto, and the Section 6(a) Indemnified Parties and the Section 6(b)
Indemnified Parties, and are not intended to benefit, and may not be relied
upon or enforced by, any other party as a third party beneficiary or
otherwise.
10. SURVIVAL. The respective indemnities, representations,
warranties and agreements of the Company and AWS contained in this Agreement
or made by or on behalf on them, respectively, pursuant to this Agreement,
shall survive the delivery of and payment for the Stock and shall remain in
full force and effect, regardless of any investigation made by or on behalf
of any of them or any person controlling any of them.
11. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of New York.
12. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
13. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
8
<PAGE>
If the foregoing correctly sets forth the agreement between the
Company and AWS, please indicate your acceptance in the space provided for
that purpose below.
Very truly yours,
DOBSON COMMUNICATIONS CORPORATION
By: /s/ Ronald L. Ripley
-----------------------------
Name: Ronald L. Ripley
Title: Vice President
Accepted:
AT&T WIRELESS SERVICES, INC.
By: /s/ William W. Hague
-----------------------
Name: William W. Hague
Title: Senior Vice President
9
<PAGE>
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
DOBSON COMMUNICATIONS CORPORATION
The undersigned, Ronald L. Ripley and Trent LeForce, certify that they
are the Vice President and Assistant Secretary, respectively, of DOBSON
COMMUNICATIONS CORPORATION, a corporation organized and existing under the
laws of the State of Oklahoma (the "Corporation"), and do hereby further
certify as follows:
1. The name of this Corporation is DOBSON COMMUNICATIONS CORPORATION.
2. The name under which the Corporation was originally incorporated was
Dobson Holdings Corporation and the original Certificate of Incorporation of
the Corporation was filed with the Secretary of State of Oklahoma on February
3, 1997.
3. This Amended and Restated Certificate of Incorporation was duly
adopted in accordance with the provisions of Sections 1077 and 1080 of the
General Corporation Act of Oklahoma (the "Act") by the written consent of the
holders of not less than a majority of the outstanding stock of the
Corporation entitled to vote thereon, and written notice of the corporate
action has been given to the stockholders of the Corporation who have not so
consented in writing, all in accordance with the provisions of Section 1080 of
the Act.
4. The text of the Certificate of Incorporation of the Corporation is
amended and restated to read in its entirety as follows:
ARTICLE I.
NAME
The name of the Corporation is:
DOBSON COMMUNICATIONS CORPORATION
ARTICLE II.
REGISTERED OFFICE AND AGENT
The address of the Corporation's registered office in the State of
Oklahoma is 13439 North Broadway Extension, Oklahoma City, Oklahoma County,
Oklahoma 73114. The registered agent is Everett R. Dobson.
<PAGE>
ARTICLE III.
PURPOSES
The nature of the business and the purpose of the Corporation shall be to
engage in any lawful act or activity and to pursue any lawful purpose for
which a corporation may be formed under the Act. The Corporation is authorized
to exercise and enjoy all powers, rights and privileges which corporations
organized under the Act may have as in force from time to time, including,
without limitation, all powers, rights and privileges necessary or convenient
to carry out the purposes of the Corporation.
ARTICLE IV.
RECLASSIFICATION AND STOCK SPLIT
Immediately upon the filing of this Amended and Restated Certificate of
Incorporation with the Secretary of State of the State of Oklahoma (the
"Effective Date"), (a) each share of Class A Common Stock, par value $.001 per
share, outstanding immediately prior to the Effective Date ("Old Class A
Common Stock") shall be, without further action by the Corporation or any
holder thereof, changed, converted and reclassified into a number of shares of
newly authorized Class B Common Stock, par value $.001 per share ("Class B
Common Stock") equal to the number of shares representing a 111.44 for 1 stock
split for each share (the "Class A Conversion Factor"), and each certificate
then outstanding stating on its face that it represents shares of Old Class A
Common Stock existing prior to the Effective Date, shall automatically
represent, from and after the Effective Date, a number of shares of Class B
Common Stock equal to the number of shares on the face of the certificate of
Old Class A Common Stock existing prior to the Effective Date multiplied by
the Class A Conversion Factor; (b) each share of Class B Common Stock, par
value $.001 per share, outstanding immediately prior to the Effective Date
("Old Class B Common Stock") shall be, without further action by the
Corporation or any holder thereof, changed, converted and reclassified into a
number of shares of newly authorized Class A Common Stock, par value $.001 per
share ("Class A Common Stock"), equal to the number of shares representing a
111.44 for 1 stock split for each share (the "Class B Conversion Factor"), and
each certificate then outstanding stating on its face that it represents
shares of Old Class B Common Stock existing prior to the Effective Date, shall
automatically represent, from and after the Effective Date, a number of shares
of Class A Common Stock equal to the number of shares on the face of the
certificate of Old Class B Common Stock existing prior to the Effective Date
multiplied by the Class B Conversion Factor, and (c) each share of Class C
Comon Stock, par value $.001 per share, outstanding immediately prior to the
Effective Date shall be, without further action by the Corporation or any
holder thereof, changed, converted and reclassified into a number of shares of
Class A Common Stock equal to the number of shares representing a 111.44 for 1
stock split for each share (the "Class C Conversion Factor"), and each
certificate then outstanding stating on its face that it represents shares of
Class C Common Stock existing prior to the Effective Date, shall automatically
represent, from and after the Effective Date, a number of shares of Class A
Common Stock equal to the number of shares on the face of the certificate of
Class C Common Stock existing prior to the Effective Date multiplied by the
Class C Conversion Factor; (d) each authorized but unissued share of Old Class
B Common Stock shall be redesignated as Class D Common Stock, par value $.001
per share ("New Class D
-2-
<PAGE>
Common Stock"), and (e) each authorized but unissued share of Class C Common
Stock shall continue to be designated as Class C Common Stock. In connection
with the stock splits described in this Article IV, no fractional shares of
newly authorized Class A Common Stock and newly authorized Class B Common
Stock shall be issued. Each fractional share of newly authorized Class A
Common Stock and newly authorized Class B Common Stock which would otherwise
be issued pursuant to this ARTICLE IV shall be rounded to the nearest whole
share.
ARTICLE V.
CAPITAL STOCK
5.1 AUTHORIZED CAPITAL STOCK. The maxImum number of shares of capital
stock which the Corporation shall have authority to issue is Two Hundred Fifty
One Million Thirty Seven Thousand Two Hundred Twenty Six (251,037,226) shares
of capital stock, of which One Hundred Seventy Five Million (175,000,000)
shares shall be Class A Common Stock, par value $.001 per share; Seventy
Million (70,000,000) shares shall be Class B Common Stock, par value $.001 per
share; Four Thousand Two Hundred Twenty Six (4,226) shares shall be Class C
Common Stock, par value $.001 per share; and Thirty Three Thousand (33,000)
shares shall be Class D Common Stock, par value $.001 per share (the Class A
Common Stock, Class B Common Stock, Class C Common Stock and Class D Common
Stock shall collectively be referred to as the "Common Stock"), and of which
Six Million (6,000,000) shares shall be preferred stock, par value $1.00 per
share (the "Preferred Stock"), of which Seven Hundred Thirty Four Thousand
(734,000) shares have been designated as 121/4% Senior Exchangeable Preferred
Stock, Five Hundred Thousand (500,000) shares have been designated as 13%
Senior Exchangeable Preferred Stock due 2009, and Forty Thousand (40,000)
shares have been designated as Class E Preferred Stock. The Common Stock and
the Preferred Stock are sometimes referred to herein as the "Capital Stock" of
the Corporation.
5.2 PREFERRED STOCK; CERTIFICATES OF DESIGNATION.
5.2.1 PREFERRED STOCK. The Preferred Stock may be issued in one
or more series. The Corporation's Board of Directors is hereby expressly
authorized without further action by the Corporation's stockholders, subject
to limitations prescribed by the Act, to authorize and otherwise provide for
the issuance of the shares of Preferred Stock in one or more series, and by
filing a certificate pursuant to the applicable law of the State of Oklahoma,
to establish from time to time the number of shares to be included in each
such series, to determine the powers, designations, preferences and relative,
participating, optional or other special rights, including voting rights, and
the qualifications, limitations and restrictions thereof, of each series of
Preferred Stock and may increase or decrease the number of shares within each
such series; provided, however, that the Corporation's Board of Directors may
not decrease the number of shares within a series to less than the number of
shares within such series that are then outstanding and may not increase the
number of shares within a series above the total number of authorized shares
of Preferred Stock for which the powers, designations, preferences and rights
have not otherwise been set forth herein. The authority of the Board of
Directors with respect to each series shall include, but not be limited to,
determination of the following:
-3-
<PAGE>
(a) the number of shares constituting that series and the
distinctive designation of that series;
(b) the dividend rate on the shares of that series,
whether dividends shall be cumulative, and, if so, from which date
or dates, and the relative rights of priority, if any, of payment of
dividends on shares of that series;
(c) whether that series shall have voting, optional and/or
special rights, in addition to the voting rights provided by law,
and, if so, the terms of such voting rights, including, without
limitation, the right to elect one or more members of the Board of
Directors;
(d) whether that series shall have conversion privileges,
and, if so, the terms and conditions of such conversion, including
provision for adjustment of the conversion rate in such events as the
Board of Directors shall determine;
(e) whether or not the shares of that series shall be
redeemable, and, if so, the terms and conditions of such redemption,
including the date or dates upon which they shall be redeemable, and
the amount per share payable in case of redemption, which amount may
vary under different conditions and at different redemption dates;
(f) whether that series shall have a sinking fund for the
redemption or purchase of shares of that series, and, if so, the
terms and amount of such sinking fund;
(g) the rights of the shares of that series in the event
of voluntary or involuntary liquidation, dissolution or winding up
of the Corporation, and the relative rights of priority, if any, of
payment of shares of that series; and
(h) the preferences and relative rights among the series
of the Preferred Stock.
5.2.2 CERTIFICATE OF DESIGNATION FOR THE 12 1/4% SENIOR
EXCHANGEABLE PREFERRED STOCK. The powers, preferences and relative,
participating, optional and other special rights of the 12 1/4% Senior
Exchangeable Preferred Stock previously issued in two series, and the
qualifications, limitations and restrictions thereof, are set forth on EXHIBIT
A hereto, which is incorporated herein by this reference.
5.2.3 CERTIFICATE OF DESIGNATION FOR THE 13% SENIOR EXCHANGEABLE
PREFERRED STOCK DUE 2009. The powers, preferences and relative,
participating, optional and other special rights of the 13% Senior
Exchangeable Preferred Stock due 2009, and the qualifications, limitations and
restrictions thereof, are set forth on EXHIBIT B hereto, which is incorporated
herein by this reference.
5.2.4 CERTIFICATE OF DESIGNATION FOR THE CLASS E PREFERRED
STOCK. The powers, preferences and relative, participating, optional and other
special rights of the Class E Preferred
-4-
<PAGE>
Stock, and qualifications, limitations and restrictions thereof, are set forth
on EXHIBIT C hereto, which is incorporated herein by this reference.
5.3 PROVISIONS APPLICABLE TO ALL CLASSES OF COMMON STOCK. Except as
otherwise required by the Act or as otherwise provided in this ARTICLE V, the
rights and preferences of the Class A Common Stock, the Class B Common Stock,
the Class C Common Stock and the Class D Common Stock, on a Fully Converted
Basis, shall be identical. As used in this Amended and Restated Certificate
of Incorporation, the term "Fully Converted Basis" shall mean, with respect to
the Class C Common Stock and Class D Common Stock, the number of shares of
Class A Common Stock which would be issued to and held by the holders of all
outstanding shares of Class C Common Stock and Class D Common Stock had all
outstanding shares of Class C Common Stock and Class D Common Stock been
converted into Class A Common Stock pursuant to Section 5.7 immediately prior
to the occurrence of the related event or action.
5.3.1 VOTING RIGHTS. Except as otherwise required by the Act or
other applicable law, the holders of Class A Common Stock and Class B Common
Stock shall vote together as a single class with respect to all matters
submitted to a vote of stockholders with each holder having the number of
votes specified below. The holders of Class A Common Stock shall be entitled
to one (1) vote per share in person or by written proxy at all annual or
special meetings of the Corporation and on matters in which the holders of
Common Stock are entitled to vote. The holders of Class B Common Stock shall
be entitled to one (1) vote per share, in person or by written proxy with
respect to any proposal that the Corporation engage in a "Rule 13e-3
transaction" as defined in Rule 13e-3 promulgated under the Securities
Exchange Act of 1934, as amended, and any successor rule or regulation, and to
ten (10) votes per share, in person or by written proxy, at all annual or
special meetings of the Corporation and on all other matters in which the
holders of Common Stock shall be entitled to vote. Except as otherwise
required by the Act or other applicable law, the holders of Class C Common
Stock and Class D Common Stock will have no voting powers whatsoever, and no
holder of Class C Common Stock or Class D Common Stock shall vote on or
otherwise participate in any proceedings in which action shall be taken by the
Corporation or the shareholders thereof. The holders of Class C Common Stock
and Class D Common Stock shall not be entitled to notification as to any
meeting of the Board of Directors or of the shareholders. The holders of
Class A Common Stock and Class B Common Stock shall each be entitled to vote
separately as a class with respect to (A) amendments to this Amended and
Restated Certificate of Incorporation that alter or change the powers,
preferences or special rights of their respective classes of stock so as to
affect them adversely and (B) such other matters as require class votes under
the Act or other applicable laws.
5.3.2 STOCK SPLITS. The Corporation shall not in any manner
subdivide (by any stock split, reclassification, stock dividend,
recapitalization or otherwise) or combine the outstanding shares of one class
of Common Stock unless the outstanding shares of all classes of Common Stock
shall be proportionately subdivided or combined; provided, however, that the
Corporation shall effect the reclassification and stock split set forth in
ARTICLE IV upon the filing of this Amended and Restated Certificate of
Incorporation. Notwithstanding anything herein to the contrary, additional
shares of Class B Common Stock may be issued to holders of Class B Common
Stock only upon a stock split or stock dividend of all classes of the
Company's stock on a pro rata basis.
-5-
<PAGE>
5.3.3 LIQUIDATION RIGHTS. Upon any voluntary or involuntary
liquidation, dissolution or winding-up of the affairs of the Corporation,
after payment shall have been made to holders of outstanding Preferred Stock,
if any, of the full amount to which they are entitled pursuant to this Amended
and Restated Certificate of Incorporation and any resolutions that may be
adopted from time to time by the Corporation's Board of Directors for the
purpose of fixing the designations, preferences, rights and restrictions of
any series of Preferred Stock, the holders of Common Stock shall be entitled
to share ratably, in accordance with the number of shares of Common Stock held
by each such holder, in all remaining assets of the Corporation available for
distribution among the holders of Class A Common Stock, Class B Common Stock,
Class C Common Stock, on a Fully Converted Basis, and Class D Common Stock,
on a Fully Converted Basis. For purposes of this paragraph, neither the
consolidation or merger of the Corporation with or into any other entity or
entities pursuant to which the holders of Capital Stock of the Corporation
receive capital stock and/or other securities (including debt securities) of
the acquiring entity (or of the direct or indirect parent entity of the
acquiring entity), nor the sale, lease or transfer by the Corporation of all
or any part of its assets, nor the reduction of the capital stock of the
Corporation, shall be deemed to be a voluntary or involuntary liquidation,
dissolution or winding up of the Corporation as those terms are used in this
paragraph.
5.3.4 DIVIDENDS. If and when dividends on the Class A Common
Stock, Class B Common Stock, Class C Common Stock or Class D Common Stock are
declared payable from time to time by the Board of Directors as provided in
this SECTION 5.3.4, whether payable in cash, in property or in shares of Class
A Common Stock or Class B Common Stock of the Corporation to the holders of
Class A Common Stock, Class B Common Stock, Class C Common Stock or Class D
Common Stock, such dividends shall be payable at the same rate and at the same
time on all classes of Common Stock including, with respect to the Class C
Common Stock and the Class D Common Stock, on a Fully Converted Basis.
Dividends payable in respect of Class A Common Stock shall be payable only in
additional shares of Class A Common Stock to holders of Class A Common Stock,
and dividends payable to holders of Class C Common Stock and Class D Common
Stock shall be payable only in additional shares of Class A Common Stock, on a
Fully Converted Basis. Dividends payable in respect of Class B Common Stock
shall be payable in shares of Class B Common Stock only to holders of Class B
Common Stock. No dividends shall be payable in shares of Class C Common Stock
or Class D Common Stock. If the Corporation shall in any manner subdivide or
combine the outstanding shares of any class of Common Stock, the outstanding
shares of the other such class of Common Stock shall be proportionally
subdivided or combined in the same manner and on the same basis as the
outstanding shares of Common Stock that have been subdivided or combined. The
Corporation shall not declare a dividend on one class of Common Stock unless
it shall declare an essentially equivalent and identical dividend (other than
in respect of voting rights as provided above in the case of in-kind
dividends) on all other classes of outstanding Common Stock.
5.4 TRANSFER OF CLASS B COMMON STOCK.
5.4.1 CLASS B PERMITTED TRANSFEREES. A Beneficial Owner (as
hereinafter defined) of shares of Class B Common Stock (herein referred to in
this Section as a "Class B Stockholder") may transfer, directly or indirectly,
shares of Class B Common Stock, whether by sale, assignment, gift or otherwise,
only to a Class B Permitted Transferee (as hereinafter defined) and no Class B
Stockholder may otherwise transfer record or Beneficial Ownership (as
-6-
<PAGE>
hereinafter defined) of any shares of Class B Common Stock. In the event of
any attempted transfer of the Beneficial Ownership of any shares of Class B
Common Stock in violation of the limitation provided in the preceding
sentence, the shares of Class B Common Stock with respect to which the
transfer of such Beneficial Ownership has been attempted shall be deemed to
have been converted automatically, without further deed or action by or on
behalf of any person, into the same number of shares of Class A Common Stock.
"Class B Permitted Transferee" shall mean, if the Class B Stockholder
is an individual:
(a) the estate of the Class B Stockholder or any legatee, heir
or distributee thereof; provided, however, that the estate of such
Class B Stockholder may transfer shares of Class B Common Stock only
to a Class B Permitted Transferee pursuant to paragraphs 5.4.1(b),
5.4.1(c), 5.4.1(d), 5.4.1(e) or 5.4.1(f) below;
(b) the spouse of the Class B Stockholder;
(c) any parent or grandparent and any lineal descendant
(including any adopted child) of any parent or grandparent of the
Class B Stockholder or of the Class B Stockholder's spouse;
(d) any guardian or custodian (including a custodian for
purposes of the Uniform Gift to Minors Act or Uniform Transfers to
Minors Act) for, or any executor, administrator, conservator and/or
other legal representative of, the Class B Stockholder and/or any
Class B Permitted Transferee or Class B Permitted Transferees
thereof;
(e) a trust (including a voting trust), and any savings or
retirement account, such as an individual retirement account for
purposes of federal income tax laws, whether or not involving a
trust, principally for the benefit of such Class B Stockholder
and/or any Class B Permitted Transferee thereof, including any trust
in respect of which such Class B Stockholder or a Class B Permitted
Transferee of such Class B Stockholder pursuant to paragraphs
5.4.1(b), 5.4.1(c) or 5.4.1(d) above has any general or special
power of appointment or general or special non-testamentary power or
special testamentary power of appointment limited to any Class B
Permitted Transferee or Class B Permitted Transferees of such Class
B Stockholder, so long as one or more trustees of such trust or
savings or retirement account is a Class B Permitted Transferee of
such Class B Stockholder, a bank, trust company or other financial
institution having trust powers.
(f) any corporation, partnership or other business entity if
Substantial Beneficial Ownership (as hereinafter defined) thereof is
held by such Class B Stockholder, and/or one or more Class B
Permitted Transferees thereof; provided, however, that if such Class
B Stockholder, and all Class B Permitted Transferees thereof, cease,
for whatever reason, to hold Substantial Beneficial Ownership of
-7-
<PAGE>
such corporation, partnership or other business entity, then any and
all shares of Class B Common Stock that such corporation,
partnership or other business entity is the Beneficial Owner of
shall be deemed to be converted automatically, without further deed
or action by or on behalf of any person, into shares of Class A
Common Stock; and
(g) Russell L. Dobson, Everett R. Dobson, Stephen T. Dobson and
the Dobson CC Limited Partnership, an Oklahoma limited partnership
(each a "Founding Investor").
"Class B Permitted Transferee" shall mean, if the Class B
Stockholder is a corporation, partnership, limited liability company, business
trust or other business entity:
(h) any estate planning or personal trust (including any voting
or liquidating trust) principally for the benefit of a Class B
Stockholder that is an individual and/or any Class B Permitted
Transferee or Class B Permitted Transferees of such individual;
(i) any corporation, partnership or other business entity if,
immediately following the transfer to such corporation, partnership
or other business entity, direct or indirect Substantial Beneficial
Ownership (as hereafter defined) thereof is held by such Class B
Stockholder, its direct or indirect majority owned parent,
subsidiaries and affiliates, and/or by any Class B Permitted
Transferee thereof; provided, however, that if such Class B
Stockholder and all Class B Permitted Transferees thereof, cease,
for whatever reason, to hold Substantial Beneficial Ownership of
such corporation, partnership or other business entity, then any and
all shares of Class B Common Stock that such corporation,
partnership or other business entity is the Beneficial Owner of
shall be deemed to be converted automatically, without further deed
or action by or on behalf of any person, into shares of Class A
Common Stock;
(j) Dobson CC Limited Partnership, an Oklahoma limited
partnership and any of its partners as of the date this Amended and
Restated Certificate of Incorporation is filed with the Secretary of
State of Oklahoma and their partners who receive such shares, by way
of dividend or distribution (upon dissolution, liquidation or
otherwise);
(k) if the Class B Stockholder is a corporation, its Class B
Permitted Transferees shall also include its majority owned parent
corporation, if any, and one or more of its majority owned
subsidiaries or majority owned subsidiaries of its majority owned
parent corporation; provided that such transfer will not result in
Beneficial Ownership of any of such shares by any person who did not
have the power to control such corporation, partnership or business
entity at the time such corporation, partnership or business entity
first acquired Beneficial Ownership of such shares of Class B Common
Stock; and
-8-
<PAGE>
(l) any Founding Investor or any Class B Permitted Transferee
of a Founding Investor pursuant to paragraphs 5.4.1(b), 5.4.1(c) and
5.4.1(d) above.
5.4.2 TRANSFERS TO BENEFICIAL OWNERS. Any person who holds
shares of Class B Common Stock for the Beneficial Ownership of another,
including (A) any broker or dealer in securities; (B) any clearing house; (C)
any bank, trust company, savings and loan association or other financial
institution; (D) any other nominee; and (E) any savings plan or account or
related trust, such as an individual retirement account, may transfer such
shares to the person or persons for whose benefit it holds such shares.
Notwithstanding anything to the contrary set forth herein, any holder of Class
B Common Stock may pledge such shares to a bank or other financial
institution as pledgee pursuant to a bona fide pledge of such shares as
collateral security for indebtedness due to the pledgee, provided that such
shares may not be transferred to or registered in the name of the pledgee
unless such pledgee is a Class B Permitted Transferee. In the event of
foreclosure or other similar action by the pledgee, such pledged shares shall
automatically, without any act or deed on the part of the Corporation or any
other person, be converted into shares of Class A Common Stock unless within
five business days after such foreclosure or similar event such pledged shares
are returned to the pledgor or transferred to a Class B Permitted Transferee.
The foregoing provisions of this paragraph shall not be deemed to restrict or
prevent any transfer of such shares, subject to any automatic conversions into
Class A Common Stock, depending on whether the transferee is a Class B
Permitted Transferee, by operation of law upon incompetence or death of any
Class B Stockholder.
5.4.3 EFFECT OF PROHIBITED TRANSFER. Any transferee of shares
of Class B Common Stock pursuant to a transfer made in violation of this
Section shall have no rights as stockholder of the Corporation and no other
rights against or with respect to the Corporation except the right to receive
the same number of shares of Class A Common Stock upon the automatic
conversion of such transferred shares of Class B Common Stock.
5.4.4 PROOF OF PERMITTED TRANSFER. The Corporation and any
transfer agent of Class B Common Stock may as a condition to the transfer or
the registration of any transfer of shares of Class B Common Stock permitted
by this SECTION 5.4 require the furnishing of such affidavits or other proof
as they deem necessary to establish that such transferee is a Class B
Permitted Transferee.
5.4.5 For purposes of this SECTION 5.4: (A) the term "Beneficial
Ownership" in respect of shares of Class B Common Stock shall mean possession
of the power and authority, either singly or jointly with another, to vote or
dispose of or to direct the voting or disposition of such shares and the term
"Beneficial Owner" in respect of shares of Class B Common Stock shall mean the
person or persons who possess such power and authority; and (B) the term
"Substantial Beneficial Ownership" in respect of any corporation, partnership
or other business entity shall mean possession of the power and authority,
either singly or jointly with another, to vote or dispose of, or to direct the
voting or disposition of, securities representing at least a 50.1% of the
total combined voting power of all securities entitled to vote, considered as
one class, in such corporation, partnership or other business entity.
-9-
<PAGE>
5.5 CONVERSION OF CLASS B COMMON STOCK BY HOLDER.
5.5.1 RIGHT TO CONVERT TO CLASS A COMMON STOCK. Subject to any
necessary approvals by the Federal Communications Commission and of any other
federal or state regulatory authority, the holders of each share of Class B
Common Stock shall have the right at any time, or from time to time, at such
holder's option, to convert such share into one fully paid and nonassessable
share of Class A Common Stock on and subject to the terms and conditions
hereinafter set forth.
5.5.2 METHOD OF CONVERSION. In order to exercise his conversion
privilege, the holder of any shares of Class B Common Stock to be converted
shall present and surrender the certificate or certificates representing such
shares during usual business hours at any office or agency of the Corporation
maintained for the transfer of Class B Common Stock and shall deliver a
written notice of the election of the holder to convert the shares represented
by such certificate or any portion thereof specified in such notice. Such
notice shall also state the name or names (with address) in which the
certificate or certificates for shares of Class A Common Stock issuable on
such conversion shall be registered. If required by the Corporation, any
certificate for shares surrendered for conversion shall be accompanied by
instruments of transfer, in form satisfactory to the Corporation, duly
executed by the holder of such shares or his duly authorized representative.
Each conversion of shares of Class B Common Stock shall be deemed to have been
effected on the date (the "conversion date") on which the certificate or
certificates representing such shares shall have been surrendered and such
notice and any required instruments of transfer shall have been received as
aforesaid, and the person or persons in whose name or names any certificate or
certificates for shares of Class A Common Stock shall be issuable on such
conversion shall be, for the purpose of receiving dividends and for all other
corporate purposes whatsoever, deemed to have become the holder or holders of
record of the shares of Class A Common Stock represented thereby on the
conversion date.
5.5.3 ISSUANCE OF CLASS A COMMON STOCK UPON CONVERSION. As
promptly as practicable after the presentation and surrender for conversion,
as herein provided, of any certificate for shares of Class B Common Stock, the
Corporation shall issue and deliver at such office or agency, to or upon the
written order of the holder thereof, certificates for the number of shares of
Class A Common Stock issuable upon such conversion. In case any certificate
for shares of Class B Common Stock shall be surrendered for conversion of a
part only of the shares represented thereby, the Corporation shall deliver at
such office or agency, to or upon the written order of the holder thereof, a
certificate or certificates for the number of shares of Class B Common Stock
represented by such surrendered certificate that are not being converted. The
issuance of certificates for shares of Class A Common Stock issuable upon the
conversion of shares of Class B Common Stock by the registered holder thereof
shall be made without charge to the converting holder for any tax imposed on
the Corporation in respect of the issue thereof. The Corporation shall not,
however, be required to pay any tax that may be payable with respect to any
transfer involved in the issue and delivery of any certificate in a name other
than that of the registered holder of the shares being converted, and the
Corporation shall not be required to issue or deliver any such certificate
unless and until the person requesting the issue thereof shall have paid to
the Corporation the amount of such tax or has established to the satisfaction
of the Corporation that such tax has been paid.
-10-
<PAGE>
5.5.4 DIVIDENDS RELATED TO CONVERSION. Upon any conversion of
shares of Class B Common Stock into shares of Class A Common Stock pursuant
hereto, no adjustment with respect to cash dividends shall be made; only those
cash dividends shall be payable on the shares so converted as have been
declared and are payable to holders of record of shares of Class B Common
Stock on a date prior to the conversion date with respect to the shares so
converted; and only those cash dividends shall be payable on shares of Class A
Common Stock issued upon such conversion as have been declared and are payable
to holders of record of shares of Class A Common Stock on or after such
conversion date.
5.5.5 RETIREMENT OF CONVERTED SHARES. Shares of Class B Common
Stock converted into Class A Common Stock shall be retired and cancelled, and
shall not be reissued.
5.5.6 RESERVATION OF SHARES OF CLASS A COMMON STOCK. Such
number of shares of Class A Common Stock as may from time to time be required
for such purpose shall be reserved for issuance upon conversion of outstanding
shares of Class B Common Stock.
5.5.7 MERGERS, CONSOLIDATIONS, SALES OF ASSETS. In the case of
a merger or consolidation which reclassifies or changes the shares of Common
Stock, or in the case of the consolidation or merger of the Corporation with
or into another corporation or corporations or the transfer of all or
substantially all of the assets of the Corporation to another corporation or
corporations, each share of Class B Common Stock shall thereafter be
convertible into the number of shares of stock or other securities or property
to which a holder of shares of Class A Common Stock would have been entitled
upon such reclassification, change, consolidation, merger or transfer, and, in
any such case, appropriate adjustment (as determined in good faith by the
Corporation's Board of Directors) may be made in the application of the
provisions herein set forth with respect to the rights and interests
thereafter of the holders of the Class B Common Stock to the end that the
provisions set forth herein shall thereafter be applicable, as nearly as
reasonably may be practicable, in relation to any shares of stock or other
securities on property thereafter deliverable upon the conversion of shares of
Class B Common Stock, including, but not limited to, the provisions set forth
in SECTION 5.3.1 with respect to the ten (10) votes per share allocable to
each share of Class B Common Stock as compared to the one vote per share
allocable to each share of Class A Common Stock. In case of any such merger
or consolidation, the resulting or surviving corporation (if not the
Corporation) shall expressly assume the obligation to deliver, upon conversion
of the Class B Common Stock, such stock or other securities or property as the
holders of the Class B Common Stock remaining outstanding shall be entitled to
receive pursuant to the provisions hereof, and to make provisions for the
protection of the conversion rights provided for in this ARTICLE V.
5.6 TRANSFER OF CLASS C COMMON STOCK AND CLASS D COMMON STOCK.
5.6.1 CLASS C TRANSFERS. In the event of any attempted transfer
of the Beneficial Ownership of any shares of Class C Common Stock, the shares
of Class C Common Stock with respect to which the transfer of such Beneficial
Ownership has been attempted shall be deemed to have been converted
automatically, without further deed or action by or on behalf of any person,
into the shares of Class A Common Stock as provided in Section 5.7.
-11-
<PAGE>
5.6.2 CLASS D TRANSFERS. In the event of any attempted transfer
of the Beneficial Ownership of any shares of Class D Common Stock, the shares
of Class D Common Stock with respect to which the transfer of such Beneficial
Ownership has been attempted shall be deemed to have been converted
automatically, without further deed or action by or on behalf of any person,
into the shares of Class A Common Stock as provided in Section 5.7.
5.6.3 TRANSFERS TO BENEFICIAL OWNERS. Any person who holds
shares of Class C Common Stock or Class D Common Stock for the Beneficial
Ownership of another, including (A) any broker or dealer in securities; (B)
any clearing house; (C) any bank, trust company, savings and loan association
or other financial institution; (D) any other nominee; and (E) any savings
plan or account or related trust, such as an individual retirement account,
may transfer such shares to the person or persons for whose benefit it holds
such shares. Notwithstanding anything to the contrary set forth herein, any
holder of Class C Common Stock may pledge such shares to a pledgee pursuant to
a bona fide pledge of such shares as collateral security for indebtedness due
to the pledgee, and such shares may be transferred to or registered in the
name of the pledgee. In the event of foreclosure or other similar action by
the pledgee, such pledged shares shall automatically, without any act or deed
on the part of the Corporation or any other person, be converted into the
number of shares of Class A Common Stock as provided in Section 5.7.
5.6.4 EFFECT OF PROHIBITED TRANSFER. Any transferee of shares
of Class C Common Stock or Class D Common Stock pursuant to a transfer made in
violation of this Section shall have no rights as stockholder of the
Corporation and no other rights against or with respect to the Corporation
except the right to receive the number of shares of Class A Common Stock upon
the automatic conversion of such transferred shares of Class C Common Stock or
Class D Common Stock pursuant to Section 5.7 hereof. Notwithstanding any
other provision of this Amended and Restated Certificate of Incorporation, the
Corporation shall, to the full extent permitted by law, be entitled to issue
shares of Class C Common Stock or Class D Common Stock to any person from time
to time.
5.6.5 For purposes of this Section: (A) the term "Beneficial
Ownership" in respect of shares of Class C Common Stock or Class D Common
Stock shall mean possession of the power and authority, either singly or
jointly with another, to vote or dispose of or to direct the voting or
disposition of such shares and the term "Beneficial Owner" in respect of
shares of Class C Common Stock or Class D Common Stock shall mean the person
or persons who possess such power and authority.
5.7 CONVERSION OF CLASS C COMMON STOCK OR CLASS D COMMON STOCK BY HOLDER.
5.7.1 RIGHT TO CONVERT TO CLASS A COMMON STOCK. A holder of
each share of Class C Common Stock and a holder of each share of Class D
Common Stock shall have the right at any time, or from time to time, at such
holder's option, to convert such share into One Hundred Eleven and 44/100
(111.44) shares, rounded to the nearest number of whole shares, of fully paid
and nonassessable shares of Class A Common Stock (the "Class C and Class D
Conversion Ratio") on and subject to the terms and conditions hereinafter set
forth.
-12-
<PAGE>
5.7.2 METHOD OF CONVERSION. In order to exercise his conversion
privilege, the holder of any shares of Class C Common Stock and the holder of
any shares of Class D Common Stock to be converted shall present and surrender
the certificate or certificates representing such shares during usual business
hours at any office or agency of the Corporation maintained for the transfer
of shares of Class C Common Stock or shares of Class D Common Stock and shall
deliver a written notice of the election of the holder to convert the shares
represented by such certificate or any portion thereof specified in such
notice. Such notice shall also state the name or names (with address) in which
the certificate or certificates for shares of Class A Common Stock issuable on
such conversion shall be registered. If required by the Corporation, any
certificate for shares surrendered for conversion shall be accompanied by
instruments of transfer, in form satisfactory to the Corporation, duly
executed by the holder of such shares or his duly authorized representative.
Each conversion of shares of Class C Common Stock and Class D Common Stock
shall be deemed to have been effected on the date (the "conversion date") on
which the certificate or certificates representing such shares shall have been
surrendered and such notice and any required instruments of transfer shall
have been received as aforesaid, and the person or persons in whose name or
names any certificate or certificates for shares of Class A Common Stock shall
be issuable on such conversion shall be, for the purpose of receiving
dividends and for all other corporate purposes whatsoever, deemed to have
become the holder or holders of record of the shares of Class A Common Stock
represented thereby on the conversion date.
5.7.3 ISSUANCE OF CLASS A COMMON STOCK UPON CONVERSION. As
promptly as practicable after the presentation and surrender for conversion,
as herein provided, of any certificate for shares of Class C Common Stock or
Class D Common Stock, the Corporation shall issue and deliver at such office
or agency, to or upon the written order of the holder thereof, certificates
for the number of shares of Class A Common Stock issuable upon such
conversion. In case any certificate for shares of Class C Common Stock or
shares of Class D Common Stock shall be surrendered for conversion of a part
only of the shares represented thereby, the Corporation shall deliver at such
office or agency, to or upon the written order of the holder thereof, a
certificate or certificates for the number of shares of Class C Common Stock
or shares of Class D Common Stock represented by such surrendered certificate
that are not being converted. The issuance of certificates for shares of Class
A Common Stock issuable upon the conversion of shares of Class C Common Stock
or Class D Common Stock by the registered holder thereof shall be made without
charge to the converting holder for any tax imposed on the Corporation in
respect of the issue thereof. The Corporation shall not, however, be required
to pay any tax that may be payable with respect to any transfer involved in
the issue and delivery of any certificate in a name other than that of the
registered holder of the shares being converted, and the Corporation shall not
be required to issue or deliver any such certificate unless and until the
person requesting the issue thereof shall have paid to the Corporation the
amount of such tax or has established to the satisfaction of the Corporation
that such tax has been paid.
The issue of certificates on conversion of Class C Common Stock
and Class D Common Stock shall be made without charge to the converting holder
for any tax in respect of the issue thereof. The Corporation shall not,
however, be required to pay any tax which may be payable in respect of any
transfer involved in the issue and delivery of shares of Class A Common Stock
in any name other than that of the holder of any shares of Class C Common
Stock or Class D Common Stock converted, and the Corporation shall not be
required to issue or
-13-
<PAGE>
deliver any certificate in respect of shares of Class C Common Stock or Class
D Common Stock unless and until the person or persons requesting the issue
thereof shall have paid to the Corporation the amount of such tax or shall
have established to the satisfaction of the Corporation that such tax has been
paid.
All shares of Class A Common Stock which may be issued upon
conversion of Class C Common Stock and Class D Common Stock will, upon issue,
be fully paid and nonassessable and free from all taxes, liens and charges
with respect to the issue thereof and free of pre-emptive rights.
In case at any time the Corporation shall propose to:
(a) pay any dividend payable in shares of Class A Common
Stock upon its Class A Common Stock or to make any distribution
(other than a cash dividend or other cash distribution payable
out of net income or undistributed earnings of the corporation)
to the holders of its Class A Common Stock;
(b) offer for subscription pro rata to the holders of its
Class A Common Stock any additional shares of any class or any
other rights or warrants to purchase Class A Common Stock;
(c) consolidate or merge with or into another person;
(d) effect any reorganization, reclassification,
liquidation, dissolution or winding-up of the corporation; or
(e) take any other action which would require an
adjustment in the Conversion Ratio;
then, and in any one or more such cases, the corporation shall cause at least
ten days' notice thereof to be given to each holder of Class C Common Stock
and Class D Common Stock of the date on which (x) the books of the corporation
shall close, or a record be taken, for such dividend on Class A Common Stock,
distribution or offering of rights or warrants or other action or (y) such
consolidation, merger, reorganization, reclassification, liquidation,
dissolution or winding-up shall be effective, as the case may be.
5.7.4 DIVIDENDS RELATED TO CONVERSION. Upon conversion of
shares of Class C Common Stock and Class D Common Stock into shares of Class A
Common Stock pursuant hereto, no adjustment with respect to cash dividends
shall be made; only those cash dividends shall be payable on the shares so
converted as have been declared and are payable to holders of record of shares
of Class C Common Stock and shares of Class D Common Stock on a date prior to
the conversion date with respect to the shares so converted; and only those
cash dividends shall be payable on shares of Class A Common Stock issued upon
such conversion as have been declared and are payable to holders of record of
shares of Class A Common Stock on or after such conversion date.
-14-
<PAGE>
5.7.5 RETIREMENT OF CONVERTED SHARES. Shares of Class C Common
Stock and Class D Common Stock converted into Class A Common Stock shall be
retired and cancelled, and shall not be reissued.
5.7.6 RESERVATION OF SHARES OF CLASS A COMMON STOCK. Such
number of shares of Class A Common Stock as may from time to time be required
for such purpose shall be reserved for issuance upon conversion of outstanding
shares of Class C Common Stock and of Class D Common Stock.
5.7.7 MERGERS, CONSOLIDATIONS, SALES OF ASSETS. In the case of
a merger or consolidation which reclassifies or changes the shares of Common
Stock, or in the case of the consolidation or merger of the Corporation with
or into another corporation or corporations or the transfer of all or
substantially all of the assets of the Corporation to another corporation or
corporations, each share of Class C Common Stock and each share of Class D
Common Stock shall thereafter be convertible into the number of shares of
stock or other securities or property to which a holder of the number of
shares of Class A Common Stock into which each share of Class C Common Stock
and each share of Class D Common Stock is then convertible would have been
entitled upon such reclassification, change, consolidation, merger or
transfer, and, in any such case, appropriate adjustment (as determined in good
faith by the Corporation's Board of Directors) may be made in the application
of the provisions herein set forth with respect to the rights and interests
thereafter of the holders of the Class C Common Stock and Class D Common Stock
to the end that the provisions set forth herein shall thereafter be
applicable, as nearly as reasonably may be practicable, in relation to any
shares of stock or other securities on property thereafter deliverable upon
the conversion of shares of Class C Common Stock and Class D Common Stock. In
case of any such merger or consolidation, the resulting or surviving
corporation (if not the Corporation) shall expressly assume the obligation to
deliver, upon conversion of the Class C Common Stock and Class D Common Stock,
such stock or other securities or property as the holders of the Class C
Common Stock and Class D Common Stock remaining outstanding shall be entitled
to receive pursuant to the provisions hereof, and to make provisions for the
protection of the conversion rights provided for in this ARTICLE V.
5.8 NO INTERFERENCE. Except as otherwise provided in ARTICLE X of
this Amended and Restated Certificate of Incorporation, the Corporation will
not close its books against the transfer of any share of Common Stock or of
any of the shares of Common Stock issued or issuable upon the conversion of
such shares of Common Stock in any manner which interferes with the timely
conversion of any of such shares.
ARTICLE VI.
EXISTENCE
The Corporation is to have a perpetual existence.
-15-
<PAGE>
ARTICLE VII.
GENERAL PROVISIONS
7.1 REGISTRATION OF TRANSFER OF CAPITAL STOCK. The Corporation shall
maintain, or cause to be maintained, a register for the registration of
Capital Stock. Upon the surrender of any certificate representing Capital
Stock at such place, the Corporation shall, at the request of the record
holder of such certificate, execute and deliver (at the Corporation's expense)
a new certificate or certificates in exchange therefor representing in the
aggregate the number of shares represented by the surrendered certificate or
certificates. Each such new certificate shall be registered in such name and
shall represent such number of shares as is requested by the holder of the
surrendered certificate and shall be substantially identical in form to the
surrendered certificate, and dividends shall accrue on the Capital Stock
represented by such new certificate from the date to which dividends have been
fully paid on such Capital Stock represented by the surrendered certificate.
The issuance of new certificates shall be made without charge to the original
holders of the surrendered certificates for any issuance tax in respect
thereof or other cost incurred by the Corporation in connection with such
issuance.
7.2 REPLACEMENT. Upon receipt of evidence reasonably satisfactory to the
Corporation (an affidavit of the registered holder shall be satisfactory) of
the ownership and the loss, theft, destruction or mutilation of any
certificate evidencing shares of any class or series of Capital Stock, and in
the case of any such loss, theft or destruction, upon receipt of an indemnity
reasonably satisfactory to the Corporation (provided that if the holder is a
financial institution or other institutional investor its own agreement shall
be satisfactory), or, in the case of any such mutilation upon surrender of
such certificate, the Corporation shall (at its expense) execute and deliver
in lieu of such certificate a new certificate of like kind representing the
number of shares of such class or series represented by such lost, stolen,
destroyed or mutilated certificate and dated the date of such lost, stolen,
destroyed or mutilated certificate, and dividends shall accrue on the Capital
Stock represented by such new certificate from the date to which dividends
have been fully paid on such lost, stolen, destroyed or mutilated certificate.
7.3 ISSUANCE OF CAPITAL STOCK. The shares of all classes and series of
Capital Stock of the Corporation may be issued by the Corporation from time to
time for such consideration as from time to time may be fixed by the Board of
Directors of the Corporation, provided that shares having a par value shall
not be issued for a consideration less than such par value, as determined by
the Board. At any time, or from time to time, the Corporation may grant rights
or options to purchase from the Corporation any shares of its Capital Stock of
any class or series (other than Class B Common Stock) to run for such period
of time, for such consideration, upon such terms and conditions, and in such
form as the Board of Directors of the Corporation may determine. The Board of
Directors of the Corporation shall have authority, as provided by law, to
determine that only a part of the consideration which shall be received by the
Corporation for the shares of its Capital Stock having a par value be capital
provided that the amount of the part of such consideration so determined to
be capital shall at least be equal to the aggregate par value of such shares.
The excess, if any, at any time of the total net assets of the Corporation
over the amount so determined to be capital, as aforesaid, shall be surplus.
All classes and series of Capital Stock of the Corporation shall be and remain
at all times nonassessable.
-16-
<PAGE>
The Board of Directors of the Corporation is hereby expressly authorized,
in its discretion, in connection with the issuance of any obligations or
Capital Stock (other than Class B Common Stock) of the Corporation (but
without intending hereby to limit its general power so to do in other cases),
to grant rights or options to purchase Capital Stock of the Corporation of any
class or series upon such terms and during such period as the Board of
Directors of the Corporation shall determine, and to cause such rights to be
evidenced by such warrants or other instruments as it may deem advisable.
7.4 INSPECTION OF BOOKS AND RECORDS. The Board of Directors of the
Corporation shall have power from time to time to determine to what extent and
at what times and places and under what conditions and regulations the
accounts and books of the Corporation, or any of them shall be open to the
inspection of the stockholders; and no stockholder shall have any right to
inspect any account or book or document of the Corporation, except as
conferred by law, unless and until authorized so to do by resolution of the
Board of Directors or the stockholders of the Corporation.
7.5 LOCATION OF MEETINGS, BOOKS AND RECORDS. Except as otherwise
provided in the Bylaws, the stockholders of the Corporation and the Board of
Directors of the Corporation may hold their meetings and have an office or
offices outside of the State of Oklahoma, and, subject to the provisions of
the laws of said State, may keep the books of the Corporation outside of said
State at such places as may, from time to time, be designated by the Board of
Directors.
ARTICLE VIII.
AMENDMENTS
The Corporation reserves the right to amend, alter, change or repeal any
provision contained in this Amended and Restated Certificate of Incorporation
in the manner now or hereinafter prescribed herein and by the laws of the
State of Oklahoma, and all rights conferred upon stockholders herein are
granted subject to this reservation.
Notwithstanding anything contained in this Amended and Restated
Certificate of Incorporation to the contrary, (i) the affirmative vote of the
holders of at least sixty-six and two-thirds percent (66-2/3%) of the issued
and outstanding Class A Common Stock and Class B Common Stock having voting
power, voting together as a single class, shall be required to amend, repeal
or adopt any provision inconsistent with ARTICLES VIII, IX, X AND XI of this
Amended and Restated Certificate of Incorporation and (ii) the affirmative
vote of the holders of at least a majority of the outstanding shares of Class
A Common Stock and the affirmative vote of the holders of at least a majority
of the outstanding shares of Class B Common Stock, each voting separately as a
class, shall be required to amend any other Article of this Amended and
Restated Certificate of Incorporation.
ARTICLE IX.
LIMITATION OF LIABILITY
9.1 LIMITATION OF LIABILITY. To the fullest extent permitted by the Act
as it now exists or may hereafter be amended (but, in the case of any such
amendment, only to the extent that
-17-
<PAGE>
such amendment permits the Corporation to provide broader indemnification
rights than permitted as of the date this Amended and Restated Certificate of
Incorporation is filed with the State of Oklahoma), and except as otherwise
provided by the Act or in the Corporation's Bylaws, no director of the
Corporation shall be liable to the Corporation or its stockholders for
monetary damages arising from a breach of fiduciary duty owed to the
Corporation or its stockholders. Any repeal or modification of the foregoing
paragraph by the stockholders of the Corporation shall not adversely affect
any right or protection of a director of the Corporation existing at the time
of such repeal or modification.
9.2 RIGHT TO INDEMNIFICATION. Each person who was or is made a party or
is threatened to be made a party to or is otherwise involved (including
involvement as a witness) in any action, suit or proceeding, whether civil,
criminal, administrative or investigative, other than an action, suit or
proceeding by or in the right of the Corporation (hereinafter, a
"proceeding"), by reason of the fact that he or she is or was a director or
officer of the Corporation or, while a director or officer of the
Corporation, is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation (including any
subsidiary of the Corporation) or of a partnership, joint venture, trust or
other enterprise, including service with respect to an employee benefit plan
(hereinafter, an "indemnitee"), where the basis of such proceeding is an
alleged action in an official capacity as a director or officer or in any
other capacity while serving as a director or officer, shall be indemnified
and held harmless by the Corporation to the fullest extent authorized by the
Act, as the same exists or may hereafter be amended (but, in the case of any
such amendment, only to the extent that such amendment permits the Corporation
to provide for broader indemnification rights than permitted as of the date
this Amended and Restated Certificate of Incorporation is filed with the
State of Oklahoma), against all expense, liability and loss (including
attorneys' fees, judgments, fines, excise taxes or penalties and amounts paid
in settlement) reasonably incurred or suffered by such indemnitee in
connection with the action, suit or proceeding, therewith and such
indemnification shall continue as to an indemnitee who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
indemnitee's heirs, executors and administrators; provided, however, that
except as provided in SECTION 9.3 of this ARTICLE IX with respect to
proceedings to enforce rights to indemnification, the Corporation shall
indemnify any such indemnitee in connection with a proceeding (or part
thereof) initiated by such indemnitee only if such proceeding (or part
thereof) was authorized by the Board of Directors of the Corporation. The
right to indemnification conferred in this SECTION 9.2 of this ARTICLE IX
shall be a contract right and shall include the obligation of the Corporation
to pay the expenses incurred in defending any such proceeding in advance of
its final disposition (hereinafter, an "advance of expenses"); provided,
however, that if and to the extent that the Board of Directors of the
Corporation requires, an advance of expenses incurred by an indemnitee in his
or her capacity as a director or officer (and not in any other capacity in
which service was or is rendered by such indemnitee, including, without
limitation, service to an employee benefit plan) shall be made only upon
delivery to the Corporation of an undertaking (hereinafter, an "undertaking"),
by or on behalf of such indemnitee, to repay all amounts so advanced if it
shall ultimately be determined by final judicial decision from which there is
no further right to appeal (hereinafter a "final adjudication") that such
indemnitee is not entitled to be indemnified for such expenses under this
Section or otherwise. The Corporation may, by action of its Board of
Directors, provide indemnification to employees and agents of the Corporation
with the same or lesser scope and effect as the foregoing indemnification of
directors and officers.
-18-
<PAGE>
9.3 PROCEDURE FOR INDEMNIFICATION. Any indemnification of a director or
officer of the Corporation or advance of expenses under SECTION 9.2 of this
ARTICLE IX shall be made promptly, and in any event within forty-five days
(or, in the case of an advance of expenses, twenty days) upon the written
request of the director or officer. If a determination by the Corporation that
the director or officer is entitled to indemnification pursuant to this
ARTICLE IX is required, and the Corporation fails to respond within sixty days
to a written request for indemnity, the Corporation shall be deemed to have
approved the request. If the Corporation denies a written request for
indemnification or advance of expenses, in whole or in part, or if payment in
full pursuant to such request is not made within forty-five days (or, in the
case of an advance of expenses, twenty days), the right to indemnification or
advances as granted by this ARTICLE IX shall be enforceable by the director or
officer in any court of competent jurisdiction. Such person's costs and
expenses incurred in connection with successfully establishing his or her
right to indemnification, in whole or in part, in such action shall also be
indemnified by the Corporation. It shall be a defense to any such action
(other than an action brought to enforce a claim for the advance of expenses
where the undertaking required pursuant to SECTION 9.2 of this ARTICLE IX, if
any, has been tendered to the Corporation) that the claimant has not met the
standards of conduct which make it permissible under the Act for the
Corporation to indemnify the claimant for the amount claimed, but the burden
of such defense shall be on the Corporation. Neither the failure of the
Corporation (including its Board of Directors, independent legal counsel, or
its stockholders) to have made a determination prior to the commencement of
such action that indemnification of the claimant is proper in the
circumstances because he or she has met the applicable standard of conduct set
forth in the Act, nor an actual determination by the Corporation (including
its Board of Directors, independent legal counsel, or its stockholders) that
the claimant has not met such applicable standard of conduct, shall be a
defense to the action or create a presumption that the claimant has not met
the applicable standard of conduct. The procedure for indemnification of other
employees and agents for whom indemnification is provided pursuant to SECTION
9.2 of this ARTICLE IX shall be the same procedure set forth in this Section
for directors or officers, unless otherwise set forth in the action of the
Board of Directors of the Corporation providing for indemnification for such
employee or agent.
9.4 INSURANCE. The Corporation may purchase and maintain insurance on
its own behalf and on behalf of any person who is or was a director, officer,
employee or agent of the Corporation or was serving at the request of the
Corporation as a director, officer, employee or agent of another Corporation
(including any subsidiary of the Corporation), partnership, joint venture,
trust or other enterprise against any expense, liability or loss asserted
against him or her and incurred by him or her in any such capacity, whether or
not the Corporation would have the power to indemnify such person against such
expenses, liability or loss under the Act.
9.5 SERVICE FOR SUBSIDIARIES. Any director, officer, employee or agent
of the Corporation serving as a director, officer, employee or agent of
another corporation, partnership, limited liability company, joint venture or
other enterprise, at least 50% of whose equity interests are owned by the
Corporation (hereinafter, a "subsidiary" for this ARTICLE IX) shall be
conclusively presumed to be serving in such capacity if requested to do so by
the Corporation.
9.6 RELIANCE. Persons who after the date of the adoption of this
provision are directors or officers of the Corporation or who, while a
director, officer, employee or agent of the
-19-
<PAGE>
Corporation, or who serves as a director, officer, employee or agent of a
subsidiary, shall be conclusively presumed to have relied on the rights to
indemnity, advance of expenses and other rights contained in this ARTICLE IX
in entering into or continuing such service. The rights to indemnification and
to the advance of expenses conferred in this ARTICLE IX shall apply to claims
made against an indemnitee arising out of acts or omissions which occurred or
occur both prior and subsequent to the adoption hereof.
9.7 NON-EXCLUSIVITY OF RIGHTS. The rights to indemnification and to the
advance of expenses conferred in this ARTICLE IX shall not be exclusive of any
other right which any person may have or hereafter acquire under this Amended
and Restated Certificate of Incorporation or under any statute, Bylaw,
agreement, vote of stockholders or disinterested directors or otherwise.
9.8 MERGER OR CONSOLIDATION. For purposes of this ARTICLE IX, references
to "the Corporation" shall include any constituent corporation (including any
constituent of a constituent) absorbed into the Corporation in a consolidation
or merger which, if its separate existence had continued, would have had power
and authority to indemnify its directors, officers, and employees or agents,
so that any person who is or was a director, officer, employee or agent of
such constituent corporation, or is or was serving at the request of such
constituent corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, shall
stand in the same position under this ARTICLE IX with respect to the resulting
or surviving corporation as he or she would have with respect to such
constituent corporation if its separate existence had continued.
ARTICLE X.
ALIEN OWNERSHIP OF STOCK
10.1 APPLICABILITY. This ARTICLE X shall be applicable to the Corporation
so long as the provisions of Section 310 of the Communications Act of 1934, as
the same may be amended from time to time (the "Communications Act") (or any
successor, provisions thereto) are applicable to the Corporation. As used
herein, the term "alien" shall have the meaning ascribed thereto by the
Federal Communications Commission ("FCC") on the date hereof and in the future
as Congress or the FCC may change such meaning from time to time. If the
provisions of Section 310 of the Communications Act (or any successor
provisions thereto) are amended, the restrictions in this ARTICLE X shall be
amended in the same way, and as so amended, shall apply to the Corporation.
The Board of Directors of the Corporation may make such rules and regulations
as it shall deem necessary or appropriate to enforce the provisions of this
ARTICLE X.
10.2 VOTING. Except as otherwise provided by law, not more than
twenty-five percent of the aggregate number of shares of Capital Stock of the
Corporation outstanding in any class or series entitled to vote on any matter
before a meeting of stockholders of the Corporation shall at any time be held
for the account of aliens or their representatives or for the account of a
foreign government or representative thereof, or for the account of any
corporation organized under the laws of a foreign country.
-20-
<PAGE>
10.3 STOCK CERTIFICATES. Shares of Capital Stock issued to or held by or
for the account of aliens and their representatives, foreign governments and
representatives thereof, and corporations organized under the laws of foreign
countries shall be represented by Foreign Share Certificates. All other shares
of Capital Stock shall be represented by Domestic Share Certificates. All of
such certificates shall be in such form not inconsistent with this Amended and
Restated Certificate of Incorporation as shall be prepared or approved by the
Board of Directors of the Corporation.
10.4 LIMITATION ON FOREIGN OWNERSHIP. Except as otherwise provided by
law, not more than twenty-five percent of the aggregate number of shares of
Capital Stock of the Corporation outstanding shall at any time be owned of
record by or for the account of aliens or their representatives or by or for
the account of a foreign government or representatives thereof, or by or for
the account of any corporation organized under the laws of a foreign country.
Shares of Capital Stock shall not be transferable on the books of the
Corporation to aliens or their representatives, foreign governments or
representatives thereof, or corporations organized under the laws of foreign
countries if, as a result of such transfer, the aggregate number of shares of
Capital Stock owned by or for the account of aliens and their representatives,
foreign governments and representatives thereof, and corporations organized
under the laws of foreign countries shall be more then twenty-five percent of
the number of shares of Capital Stock then outstanding. If it shall be found
by the Corporation that Capital Stock represented by a Domestic Share
Certificate is, in fact, held by or for the account of aliens or their
representative, foreign governments or representatives thereof, or
corporations organized under the laws of foreign countries, then such Domestic
Share Certificate shall be canceled and a new certificate representing such
Capital Stock marked "Foreign Share Certificate" shall be issued in lieu
thereof, but only to the extent that after such issuance the Corporation shall
be in compliance with this ARTICLE X; provided, however, that if, and to the
extent, such issuance would violate this ARTICLE X, then, the holder of such
Capital Stock shall not be entitled to vote, to receive dividends, or to have
any other rights with regard to such Capital Stock to such extent, except the
right to transfer such Capital Stock to a citizen of the United States.
10.5 TRANSFER OF FOREIGN SHARE CERTIFICATES. Any Capital Stock
represented by Foreign Share Certificates may be transferred either to aliens
or non-aliens. In the event that any Capital Stock represented by a
certificate marked "Foreign Share Certificate" is sold or transferred to a
non-alien, then such non-alien shall be required to exchange such certificate
for a certificate marked "Domestic Share Certificate." If the Board of
Directors of the Corporation reasonably determines that a Domestic Share
Certificate has been or is to be transferred to or for the account of aliens
or their representatives, foreign governments or representatives thereof, or
corporations organized under the laws of foreign countries, the Corporation
shall issue a new certificate for the shares of Capital Stock transferred to
the transferee marked "Foreign Shares Certificate", cancel the old Domestic
Share Certificate, and record the transaction upon its books, but only to the
extent that after such transfer is complete, the Corporation shall be in
compliance with this ARTICLE X.
Notwithstanding any other provision of this Amended and Restated
Certificate of Incorporation, the transfer or conversion of the Corporation's
Capital Stock, whether voluntary or involuntary, shall not be permitted, and
shall be ineffective, if such transfer or conversion would (i) violate (or
would result in violation of) the Communications Act or any of the rules or
-21-
<PAGE>
regulations promulgated thereunder or (ii) require the prior approval of the
FCC, unless such prior approval has been obtained.
ARTICLE XI.
BOARD OF DIRECTORS
11.1 MANAGEMENT BY BOARD OF DIRECTORS. The business and affairs of the
Corporation shall be under the direction of the Board of Directors.
11.2 NUMBERS OF DIRECTORS. The number of directors which shall constitute
the whole board shall be not less than three nor more than fifteen (plus such
number of additional directors as the holders of Preferred Stock from time to
time may be entitled to elect), and, except with respect to directors entitled
to be elected by holders of Preferred Stock, shall be determined by resolution
adopted by a vote of a majority of the entire board, or at an annual or
special meeting of stockholders by the affirmative vote of the holders of
sixty-six and two-thirds percent (66-2/3%) of the total combined voting power
of the Common Stock entitled to vote generally in the election of directors
voting together as a single class. The directors elected by the holders of
Common Stock shall be divided into three classes, as nearly equal in number as
may be practicable, to serve in the first instance until the annual meeting of
stockholders to be held in 2001, 2002 and 2003, respectively, and until their
successors shall be elected and shall qualify. At each annual meeting of
stockholders beginning with the annual meeting in 2001, the successors to the
class of directors whose terms expire at that time, shall be elected to serve
for a term of three years and until their successors shall be elected and
shall qualify. In the event of any increase or decrease in the number of
directors, the additional or eliminated directorships shall be so classified
so that all classes of directors shall remain or become equal in number, as
nearly as may be practicable. Each director shall hold office for the term
for which he is elected or appointed and until his successor shall be elected
and shall qualify, or until his death, or until he shall resign or be removed.
The successors to the class of directors whose terms expire shall be elected
at the annual meeting of stockholders; and those persons who receive the
highest number of votes shall be deemed to have been elected. No reduction in
number shall have the effect of removing any director prior to the expiration
of his term. The number of directors of the Corporation may, from time to
time, be increased or decreased in such manner as may be provided in the
Bylaws of the Corporation.
11.3 ELECTION OF DIRECTORS. Election of directors need not be by written
ballot unless otherwise provided in the Bylaws.
11.4 EXPRESS AUTHORIZATION. In furtherance and not in limitation of the
powers conferred by statute, the Board of Directors is expressly authorized:
(a) To adopt, amend or repeal the Bylaws of the Corporation;
but the powers of such directors in this regard shall at all times
be subject to the rights of the stockholders to alter or repeal such
Bylaws at any meeting of stockholders;
(b) To authorize and cause to be executed or granted mortgages,
security interests and liens upon the real and personal property of
the Corporation;
-22-
<PAGE>
(c) To set apart out of any of the funds of the Corporation
available for dividends a reserve or reserves for any proper purpose
and to abolish any such reserve in the manner in which it was
created;
(d) By a majority of the whole Board of Directors, to designate
one or more committees, each committee to consist of one (1) or more
of the directors of the Corporation. The board may designate one (1)
or more directors as alternate members of any committee, who may
replace any absent or disqualified member at any meeting of the
committee. Any such committee, to the extent provided in the
resolution or in the Bylaws of the Corporation, shall have and may
exercise the powers of the Board of Directors in the management of
the business and affairs of the Corporation, and may authorize the
seal of the Corporation to be affixed to all papers which may
require it; provided, however, the Bylaws may provide that in the
absence or disqualification of any member of such committee or
committees, the member or members thereof present at any meeting and
not disqualified from voting, whether or not he or they constitute a
quorum, may unanimously appoint another member of the Board of
Directors to act at the meeting in the place of any such absent or
disqualified member; and
When and as authorized by the affirmative vote of the holders of
Common Stock representing a majority of the total combined voting
power of all classes of Common Stock, issued and outstanding and
entitled to vote generally, given at a stockholders' meeting duly
called upon such notice as is required by law, or when authorized by
the written consent of the holders of a majority of the voting power
of all classes of Common Stock issued and outstanding and entitled
to vote, or as otherwise required by the Act, to sell, lease or
exchange all or substantially all of the property and assets of the
Corporation, including its goodwill and its corporate franchises,
upon such terms and conditions and for such consideration, which may
consist in whole or in part of other securities of, any other
corporation or corporations, as the Board of Directors shall deem
expedient and for the best interests of the Corporation.
ARTICLE XII.
BYLAWS
12.1 BYLAWS. In furtherance and not in limitation of the powers conferred
by statute, the Board of Directors is expressly authorized to adopt, repeal,
alter, amend or rescind the Bylaws of the Corporation. In addition, the Bylaws
of the Corporation may be adopted, repealed, altered, amended, or rescinded by
the affirmative vote of the holders of Common Stock representing sixty-six and
two-thirds percent (66-2/3%) of the total combined voting power of all classes
of Common Stock entitled to vote generally in the election of directors,
issued and outstanding and entitled to vote thereon.
IN WITNESS WHEREOF, Dobson Communications Corporation has caused its
corporate seal to be hereunto affixed and this Amended and Restated
Certificate of Incorporation to be signed
-23-
<PAGE>
by Ronald L. Ripley, its Vice President and attested by Trent LeForce, its
Assistant Secretary, this _____ day of February, 2000.
DOBSON COMMUNICATIONS CORPORATION
/s/ Ronald L. Ripley
---------------------------------------
Ronald L. Ripley, Vice President
Attest:
/s/ Trent LeForce
- -----------------------------------
Trent LeForce, Assistant Secretary
-24-
<PAGE>
- -------------------------------------------------------------------------------
SECOND AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
of
ACC ACQUISITION LLC
between
AT&T WIRELESS SERVICES JV CO.
and
DOBSON JV COMPANY
Dated as of February 25, 2000
- -------------------------------------------------------------------------------
<PAGE>
SECOND AMENDED AND RESTATED
LIMITED LIABILITY COMPANY AGREEMENT
SECOND AMENDED AND RESTATED LIMITED LIABILITY COMPANY
AGREEMENT, dated as of February 25, 2000, by and between AT&T Wireless
Services JV Co., a Delaware corporation ("AWS Sub") and a 100% Subsidiary of
AWS Wireless Services, Inc., a Delaware corporation ("AWS"), and Dobson JV
Company, an Oklahoma corporation ("DCC Sub") and a 100% Subsidiary of Dobson
Communications Corporation, an Oklahoma corporation ("DCC").
WHEREAS, AWS Sub and DCC Sub are party to the Operating
Agreement of ACC Acquisition LLC dated as of October 4, 1999, as amended and
restated as of January 31, 2000 (the "Original Agreement"); and
WHEREAS, AWS Sub and DCC Sub desire to amend and restate the
Original Agreement.
NOW, THEREFORE, in consideration of the mutual promises and
covenants herein contained, it is hereby agreed, and the Original Agreement is
hereby amended and restated, as follows:
ARTICLE 1
DEFINITIONS
Capitalized terms used in this Agreement without other
definition shall, unless expressly stated otherwise, have the meanings
specified in this Article 1.
"80% Subsidiary" of a Person or group (as such term is used
in Sections 13(d) and 14(d) of the Exchange Act and the regulations
thereunder) means any Subsidiary that is controlled by such Person or group,
and at least 80% of whose voting power and at least 80% of whose economic
interests are owned directly by such Person or group or by an 80% Subsidiary
of such Person or group.
"100% Subsidiary" of a Person or group (as such term is used
in Sections 13(d) and 14(d) of the Exchange Act and the regulations
thereunder) means any Subsidiary that is controlled by such Person or group,
and 100% of whose voting power and 100% of whose economic interests are owned
directly by such Person or group or by a 100% Subsidiary of such Person or
group.
"Act" means the Delaware Limited Liability Company Act, as
amended from time to time.
<PAGE>
"Adjusted Capital Account Deficit" means, with respect to
any Member, the deficit balance, if any, in such Member's Capital Account as
of the end of the relevant fiscal year, after giving effect to the following
adjustments:
(i) such Capital Account shall be deemed to be
increased by any amounts which such Member is obligated to restore to
the Company (pursuant to this Agreement or otherwise) or is deemed to
be obligated to restore pursuant to the second to last sentence of
Treasury Regulation Sections 1.704-2(g)(1) and 1.704-2(i)(5) (relating
to allocations attributable to nonrecourse debt); and
(ii) such Capital Account shall be deemed to be
decreased by the items described in Treasury Regulation Sections
1.704-1(b)(2)(ii)(d)(4), (5) and (6).
The foregoing definition of Adjusted Capital Account Deficit
is intended to comply with the provisions of Treasury Regulation Section
1.704-1(b)(2)(ii)(d) and shall be interpreted and applied consistently
therewith.
"Adopted Service Features" means the Core Service Features
and additional service features that are adopted by the Company in accordance
with the terms of this Agreement.
"Affiliate" means, with respect to any Person, any other
Person that, either directly or indirectly through one or more intermediaries,
controls, is controlled by or is under common control with such Person.
"Affiliate Group" means each of the AWS Affiliate Group and
the DCC Affiliate Group.
"Agents" is defined in Section 8.9(a).
"Agreement" means this Amended and Restated Limited
Liability Company Agreement, as amended, modified, supplemented or restated
from time to time.
"Appraiser" is defined in Section 9.7.
"AT&T" means AT&T Corp.
"AT&T PCS" means AT&T Wireless PCS, LLC.
"AWS" is defined in the first paragraph hereof.
"AWS Affiliate Group" means (a) AWS Sub, so long as AWS Sub
is an 80% Subsidiary of AWS, (b) AWS and any Subsidiary of AWS so long as such
Subsidiary is an 80% Subsidiary of AWS and (c) AT&T and any Subsidiary of AT&T
so long as such Subsidiary is an 80% Subsidiary of AT&T.
2
<PAGE>
"AWS Member Group" means Members that are members of the AWS
Affiliate Group and their Private Transferees.
"AWS Sub" is defined in the first paragraph hereof.
"Book Value" means, with respect to any asset of the Company,
the asset's adjusted basis as of the relevant date for federal income tax
purposes except as follows:
(i) the initial Book Value of any asset contributed by a
Member to the Company shall be the Fair Market Value of such asset, as
determined by the contributing Member and the Company with the
concurrence of the Members other than the contributing Member;
(ii) the Book Values of all Company assets (including
intangible assets such as goodwill) shall be adjusted to equal their
respective Fair Market Values (as adjusted by Section 7701(g) of the
Code) as of the following times:
(A) the acquisition of an additional Interest by any
new or existing Member in exchange for more than a de minimis
capital contribution;
(B) the distribution by the Company to a Member of
more than a de minimis amount of money or other Company
property as consideration for an interest in the Company; and
(C) the termination of the Company for federal income
tax purposes pursuant to Section 708(b) of the Code;
(iii) the Book Value of any Company asset distributed to any
Member shall be the Fair Market Value of such asset (as adjusted by
Section 7701(g) of the Code) on the date of distribution;
(iv) if the Book Value of an asset has been determined or
adjusted pursuant to clause (i) or clause (ii) above, such Book Value
shall thereafter be adjusted by the Depreciation taken into account
with respect to such asset for purposes of computing Profits and
Losses, and other items allocated pursuant to Article 4; and
(v) the Book Value of Company assets shall be increased or
decreased, as appropriate, to reflect any adjustments to the adjusted
tax bases of such assets pursuant to Sections 734(b) or 743(b) of the
Code, but only to the extent that such adjustments are taken into
account in determining Capital Accounts pursuant to Treasury
Regulation Section 1.704-1(b)(2)(iv)(m) and clause (v) of the
definition of "Profits" and "Losses" set forth below; provided,
however, that Book Values shall not be adjusted pursuant to this
clause (v) to the extent that an adjustment pursuant to
3
<PAGE>
clause (ii) or (iii) hereof is required in connection with a
transaction that would otherwise result in an adjustment pursuant to
this clause (v).
The foregoing definition of Book Value is intended to comply
with the provisions of Treasury Regulation Section 1.704-1(b)(2)(iv) and shall
be interpreted and applied consistently therewith.
"Business" means the business of (a) owning, constructing
and operating systems to provide Company Communications Services, solely
within the Territory, (b) providing to end-users and resellers Company
Communications Services available on such systems, (c) providing in connection
with such Company Communications Services, solely within the Territory, the
Adopted Service Features and (subject to the immediately following sentence)
Telecommunications Services incidental or ancillary to such Company
Communications Services provided to end-users of such Company Communications
Services (including, by way of example, bundling additional Telecommunications
Services with Company Communications Services), and (d) marketing and offering
the services and features described in clauses (b) and (c) within the
Territory, including advertising such services and features using broadcast
and other media, so long as such advertising extends beyond the Territory only
when and to the extent necessary to reach customers and potential customers in
the Territory. The activities described in clauses (a) and (b) shall be the
indispensable requisite, and primary business, of the Company and, to the
extent the Company provides Telecommunications Services incidental or
ancillary thereto, the Company and its Subsidiaries shall be only the agent or
reseller for the provider thereof and shall not own or lease the facilities
used to provide such services, except that the Company may own or lease
facilities that, in the aggregate, do not have a purchase price to the Company
and its Subsidiaries in excess of $10 million, and the Company may be a
facilities-based provider of services using such facilities.
"Buyers" is defined in Section 9.2(a).
"Buy-Sell Procedure" is defined in Section 9.9(a).
"Capital Account" is defined in Section 3.1(a).
"Cellular System" means a wireless communications system
constructed and operated in a Metropolitan Statistical Area or Rural
Statistical Area as defined by the FCC (or any territorial designations or
subdivision thereof authorized by the FCC) exclusively using frequencies in
the 800 MHz band allocated for the Cellular Radiotelephone Service under Part
22 of the FCC Rules, pursuant to a License therefor issued by the FCC.
"Change of Control of DCC" means:
(i) at any time as Voting Securities of DCC (excluding
shares of Class B Common Stock owned beneficially by members of the
Dobson Group) having at least a majority of the voting power of the
Voting Securities of DCC then outstanding (on
4
<PAGE>
a fully diluted basis, treating Equity Interests of DCC issuable upon
the conversion, exchange or exercise of convertible or exchangeable
securities, or other rights to acquire Equity Interests, as issued
and outstanding) are not listed for trading on a national securities
exchange or quoted on the NASDAQ National Market System, any
circumstance, event or transaction following which
(A) the members of the Dobson Group cease to be the
exclusive "beneficial owners" (as such term is used in Rules
13d-3, 13d-5 or 16a-1 under the Exchange Act), of at least a
majority of the outstanding Equity Interests of DCC (on a
fully diluted basis, treating Equity Interests of DCC
issuable upon the conversion, exchange or exercise of
convertible or exchangeable securities, or other rights to
acquire Equity Interests, as issued and outstanding) or
(B) Everett R. Dobson or (in the event of the death
or Disability of Everett R. Dobson) the members of the Dobson
Group cease to have, directly or indirectly, the exclusive
right to vote Voting Securities of DCC having at least a
majority of the voting power of the Voting Securities of DCC
then outstanding;
(ii) so long as Voting Securities of DCC (excluding shares
of Class B Common Stock owned beneficially by members of the Dobson
Group) having at least a majority of the voting power of the Voting
Securities of DCC then outstanding (on a fully diluted basis,
treating Equity Interests of DCC issuable upon the conversion,
exchange or exercise of convertible or exchangeable securities, or
other rights to acquire Equity Interests, as issued and outstanding)
are listed for trading on a national securities exchange or quoted on
the NASDAQ National Market System, any circumstance, event or
transaction following which
(A) the members of the Dobson Group cease to be the
exclusive "beneficial owners" (as such term is used in Rules
13d-3, 13d-5 or 16a-1 under the Exchange Act) of at least 35%
of the outstanding Equity Interests of DCC (on a fully
diluted basis, treating Equity Interests of DCC issuable
upon the conversion, exchange or exercise of convertible or
exchangeable securities, or other rights to acquire Equity
Interests, as issued and outstanding) or
(B) Everett R. Dobson or (in the event of the death
or Disability of Everett R. Dobson) the members of the Dobson
Group, cease to have, directly or indirectly, the exclusive
right to vote Voting Securities of DCC having at least 35% of
the voting power of the Voting Securities of DCC then
outstanding, or
(C) another Person or group (as such term is used in
Sections 13(d) and 14(d) of the Exchange Act and the
regulations thereunder) is the
5
<PAGE>
"beneficial owner" (as such term is used in Rules 13d-3,
13d-5 or 16a-1 under the Exchange Act) of at least 35% of
the Voting Securities of DCC or 35% of the outstanding
Equity Interests of DCC (on a fully diluted basis, treating
Equity Interests of DCC issuable upon the conversion,
exchange or exercise of convertible or exchangeable
securities, or other rights to acquire Equity Interests, as
issued and outstanding) or otherwise has the power, acting
alone, to control DCC; or
(iii) the sale of all or substantially all of DCC's stock,
business or assets (including through a merger or otherwise).
"Claim" is defined in Section 11.3(a).
"Code" means the Internal Revenue Code of 1986, as amended
from time to time.
"Company" means ACC Acquisition LLC.
"Company Communications Services" means Commercial Mobile
Radio Services regulated under FCC Rules Subpart H of Part 22, Subpart E of
Part 24, and Part 20 in effect as of the Effective Date.
"Company Minimum Gain" means the aggregate of the amounts of
gain, if any, determined for each nonrecourse liability of the Company, that
would be realized by the Company for federal income tax purposes if it
disposed of the Company property subject to such liability in a taxable
transaction in full satisfaction thereof and for no other consideration. To
the extent the foregoing is inconsistent with Treasury Regulation Section
1.704-2(d) or incomplete with respect to such regulation, Company Minimum Gain
shall be computed in accordance with such regulation.
"Confidential Information" means all documents and
information (including without limitation, commercial information and
information with respect to customers and proprietary technologies or
processes and the design and development of new products or services)
concerning the Company, the Cellular Systems and PCS Systems in which the
Company has an ownership interest, the Members or their Affiliates furnished
to a Member or any of its Affiliates in connection with the transactions
leading up to and contemplated by this Agreement and the other Related
Agreements and the operation of the Company which is (i) not otherwise in the
public domain, (ii) not otherwise in the rightful possession of such Member
(or Affiliate) from third parties having no obligation of confidentiality to
the other Member or the Company and (iii) not required to be disclosed by such
Member, its Affiliates or Agents pursuant to federal, state or local law.
"control," "controlled" and "controlling" shall mean
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of Voting Securities, by contract or otherwise.
6
<PAGE>
"Core Service Features" means the service features set forth
on Schedule I.
"Corporation" is defined in Section 8.10(a).
"DCC" is defined in the first paragraph hereof.
"DCC Affiliate Group" means (a) DCC Sub so long as it is an
80% Subsidiary of DCC and DCC is a member of the DCC Affiliate Group, (b) any
Parent of DCC Sub so long as such Parent is an 80% Subsidiary of DCC and DCC
is a member of the DCC Affiliate Group, (c) DCC so long as a Change of Control
of DCC has not occurred, (d) any Parent of DCC so long as such Parent is an
80% Subsidiary of the Dobson Group and (e) the Dobson Group. Logix
Communications is not a member of the DCC Affiliate Group.
"DCCLP" means Dobson CC Limited Partnership, an Oklahoma
limited partnership.
"DCC Member Group" means Members that are members of the DCC
Affiliate Group and their Private Transferees.
"DCC Sub" is defined in the first paragraph hereof.
"Depreciation" means, for each fiscal year or part thereof,
an amount equal to the depreciation, amortization, or other cost recovery
deduction allowable for federal income tax purposes with respect to an asset
for such year or other period, except that if the Book Value of an asset
differs from its adjusted basis for federal income tax purposes at the
beginning of such year, Depreciation shall be an amount which bears the same
ratio to such Book Value as the federal income tax depreciation, amortization
or other cost recovery deduction for such year bears to such adjusted tax
basis; provided that if the federal income tax depreciation, amortization or
other cost recovery deduction for such year is zero, Depreciation shall be
determined with reference to such Book Value using any reasonable method
selected by the Management Committee, subject to any applicable legal
regulations.
"Disability" means, with respect to Everett R. Dobson, that
he is disabled in accordance with the provisions of the long-term disability
insurance policies of DCC applicable to him or, in the absence of any such
policies, that he is unable, for 180 consecutive days, or 270 total days, in
any 360-day period, to exercise his material duties as Chief Executive Officer
of DCC.
"Dispute" is defined in Section 8.11(a).
"Dispute Notice" is defined in Section 8.11(c).
"Disqualifying Transaction" means a merger, consolidation,
asset acquisition or disposition, or other business combination involving AT&T
(or its Affiliates) and another
7
<PAGE>
Person, which other Person (together with its Affiliates but before giving
effect to such merger, consolidation, asset acquisition or disposition or
other business combination) (a) derives annual aggregate revenues in excess of
$5 billion from the provision of Telecommunication Services (based on its most
recently ended fiscal year for which such information is available), (b)
derives less than one-third of its annual aggregate revenues from the
provision of wireless Telecommunications Services (based on its most recently
ended fiscal year for which such information is available), (c) owns Licenses
issued by the FCC which authorize it to offer (and does offer) Mobile Wireless
Services serving more than 25% of the Pops within the Territory, and (d) with
respect to which AWS Sub has given written notice to the Company and the other
Members specifying that such merger, consolidation, asset acquisition or
disposition or other business combination shall be a Disqualifying Transaction
for purposes of this Agreement and the transactions contemplated hereby.
"Distributable Cash" means, as of the end of any fiscal
period, the amount of the cash and cash equivalents held by the Company and
its Subsidiaries available for distribution to the Members, as determined by
the Management Committee in accordance with sound business practice.
"Dobson Family" means, collectively, the Immediate Families
of Russell L. Dobson, Everett R. Dobson, Stephen T. Dobson and Robin Dobson.
"Dobson Group" means, collectively, the Persons set forth on
Schedule II and members of the Dobson Family.
"Dobson IPO" means an initial public offering of common stock
of DCC pursuant to an effective registration statement under the Securities Act,
the aggregate gross proceeds from which public offering equals or exceeds $50.0
million.
"Economic Interest" means the percentage interest of a
Member (or a permitted assignee of a Member pursuant to Article 9 which has
not been admitted as a Member of the Company) in the aggregate distributions
by the Company, and the aggregate allocations by the Company of Profits,
Losses, income, gain, loss, deduction or credit or any similar item, and all
other rights and interests of a Member of the Company that are not Voting
Interests. The term "Economic Interest" specifically excludes a Voting
Interest.
"Effective Date" means the Closing Date under the Agreement
and Plan of Merger, dated as of October 5, 1999, among the Company, ACC
Acquisition Co. and American Cellular Corporation.
"Equity Interests" means capital stock, partnership
interests, limited liability company interests or other ownership or
beneficial interests of any Person.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
8
<PAGE>
"Fair Market Value" means, with respect to any asset, as of
the date of determination, the cash price at which a willing seller would sell
and a willing buyer would buy such asset in a transaction negotiated at arm's
length, each being apprised of and considering all relevant facts,
circumstances and factors, and neither acting under compulsion, with the
parties being unaffiliated third parties acting without time constraints.
"FCC" means the Federal Communications Commission or any
successor agency or entity performing substantially the same functions.
"FCC Rules" means the rules and regulations established by
the FCC codified in Section 47 of the Code of Federal Regulations, as the same
may be modified or amended from time to time hereafter.
"Final Order" means an action by the FCC or any state
regulatory agency granting its approval for the transfer of control of the
Company as to which (i) no request for stay by the FCC or state regulatory
action is pending, no such stay is in effect, and, if any deadline for filing
any such request is designated by statute, rule or regulation, such deadline
has passed; (ii) no petition for rehearing or reconsideration or application
for review of the action is pending before the FCC or any state regulatory
agency, and the time for filing any such petitions or applications has passed;
(iii) neither the FCC nor any state regulatory agency has the action under
reconsideration on its own motion and the time for such reconsideration has
passed; and (iv) no appeal to a court, or request for stay by a court, of the
action of the FCC or state regulatory agency is pending or in effect, and, if
any deadline for filing any such appeal or request is designated by statute,
rule or regulation, it has passed.
"GAAP" means generally accepted accounting principles as
used by the Financial Accounting Standards Board and/or the American Institute
of Certified Public Accountants.
"Governmental Authority" means a national, state,
provincial, county, city, local or other governmental or regulatory body or
authority, whether domestic or foreign.
"Immediate Family" means, with respect to any Person, such
Person's spouse, parents, spouse's parents, siblings, children, stepchildren,
adopted children and grandchildren.
"Included Interests" is defined in Section 9.3(a).
"Indemnified Person" is defined in Section 11.1(b).
"Indirect Transfer" means, with respect to Interests in the
Company owned by a Member that is a member of an Affiliate Group, a Transfer
of Equity Interests in a Person that owns directly or indirectly Equity
Interests in such Member.
9
<PAGE>
"Initial Economic Interests" means the Economic Interests
acquired by AWS Sub and DCC Sub on the Effective Date.
"Interest" means the Economic Interest and the Voting
Interest of a Member, and includes the entire legal and equitable ownership
interest of a Member in the Company.
"IPO" means the initial underwritten public offering of the
Company's equity securities pursuant to an effective registration statement
under the Securities Act.
"License" means, with respect to a PCS System or Cellular
System, all permits, licenses, waivers, and authorizations (including,
without limitation, licenses issued by the FCC) that are necessary to conduct
the operations of such system in the manner in which such operations are
currently contemplated, or may in the future be contemplated by the licensee
to be conducted.
"Lien" means, with respect to any asset, any mortgage,
lien, pledge, charge, security interest, right of first refusal or right of
others therein, or encumbrance of any nature whatsoever in respect of such
asset.
"Liquidator" is defined in Section 10.3(b).
"Logix Communications" means Logix Communications
Enterprises, Inc.
"Management Agreement" means the Management Agreement,
dated as of the date hereof, between the Company and Dobson Cellular Systems,
Inc., as the same may be amended in accordance herewith and therewith.
"Management Committee" is defined in Section 7.1.
"Member" means, initially, AWS Sub and DCC Sub as long as
they have not ceased to be Members hereunder, and any Person who, at the time
of the reference thereto, has been admitted to the Company as a Member in
accordance with the terms of this Agreement and has not ceased to be a Member
hereunder, in such Person's capacity as a member (within the meaning of the
Act) of the Company.
"Member Group" means each of the AWS Member Group and the
DCC Member Group.
"Member Minimum Gain" means an amount, with respect to each
Member nonrecourse debt, equal to the Company Minimum Gain that would result
if such Member nonrecourse debt were treated as a nonrecourse liability,
determined in accordance with Treasury Regulation Section 1.704-2(i).
"Member Nonrecourse Debt" has the meaning ascribed to the
term "partner nonrecourse debt" in Treasury Regulation Section 1.704-2(b)(4),
and generally means any
10
<PAGE>
nonrecourse debt of the Company for which any Member bears the economic risk
of loss (such as a nonrecourse loan to the Company by a Member or certain
Affiliates of a Member).
"Member Nonrecourse Deduction" has the meaning ascribed to
the term "partner nonrecourse deduction" in Treasury Regulation Section
1.704-2(i)(2). The amount of the Member Nonrecourse Deductions with respect
to a Member Nonrecourse Debt for a Company fiscal year equals the net
increase, if any, in the amount of Member Minimum Gain attributable to such
Member Nonrecourse Debt during that fiscal year, reduced (but not below zero)
by the aggregate amount of any distributions during that fiscal year to the
Member that bears the economic risk of loss for such Member Nonrecourse Debt
to the extent such distributions are from the proceeds of such Member
Nonrecourse Debt and are allocable to an increase in Member Minimum Gain
attributable to such Member Nonrecourse Debt.
"Mobile Wireless Services" shall mean mobile wireless
Company Communications Services (including the transmission of voice, data,
image or other messages or content) provided solely within the Territory,
initiated or terminated using TDMA or analog cellular technology and on
frequencies in the 800 MHz band authorized for the Cellular Radiotelephone
Service under Part 22 of the FCC Rules or in the 1900 MHz band authorized for
the Personal Communications Services under Part 24 of the FCC Rules, to or
from subscriber equipment that is capable of usage during routine movement
throughout the area covered by a cell site and routine handing-off between
cell sites, and is either intended for such usage or is temporarily fixed to
a specific location on a short-term basis (e.g., a bank of wireless
telephones temporarily installed during a special event of limited duration).
Without limiting the foregoing, Mobile Wireless Services shall include
wireless office services if such services comply with this definition. Mobile
Wireless Services shall also include the transmissions between the Company's
cell sites and the Company's switch or switches in the Territory, the
handing-off of transmissions at the Company's switch or switches for
termination by other carriers, and the receiving of transmissions for the
Company's customers handed-off at the Company's switch or switches which were
originated on the system or systems of other carriers, in each case for the
purpose of facilitating Mobile Wireless Services described in the first
sentence.
"Nonrecourse Deductions" has the meaning set forth in
Treasury Regulation Section 1.704-2(c). The amount of Nonrecourse Deductions
for a fiscal year equals the net increase, if any, in the amount of Company
Minimum Gain during that fiscal year, reduced (but not below zero) by any
Nonrecourse Distributions during such year.
"Nonrecourse Distributions" means the aggregate amount, as
determined in accordance with Treasury Regulation Section 1.704-2(c), of any
distributions during the fiscal year of proceeds of a nonrecourse liability,
as defined in Treasury Regulation Section 1.704(b)(3), that are allocable to
an increase in Company Minimum Gain.
"Offer" is defined in Section 9.2(a).
11
<PAGE>
"Offer Notice" is defined in Section 9.2(a).
"Offered Interests" is defined in Section 9.2(a).
"Offeror" is defined in Section 9.2(a).
"Operating Agreement" means the Operating Agreement, dated
as of the date hereof, among the Company, AWS and DCC, as the same may be
amended in accordance herewith and therewith.
"Parent" means, with respect to a specified entity, a Person
or group of which the specified entity is a Subsidiary.
"PCS" means the Personal Communications Services regulated
under Part 24 of the FCC Rules.
"PCS System" means a wireless communications system
constructed and operated in a Basic Trading Area or Major Trading Area as
defined by Rand-McNally and modified by the FCC (or any territorial
designations or subdivision thereof authorized by the FCC) exclusively using
frequencies in the 1900 MHz band allocated for the broadband Personal
Communications Service under Part 24 of the FCC Rules, pursuant to a License
therefor issued by the FCC.
"Person" means any individual, corporation, partnership,
firm, joint venture, limited liability company, limited liability
partnership, association, joint stock company, trust, estate, incorporated or
unincorporated organization, Governmental Authority or other entity.
"Pops" means with respect to any licensed area, the
residents of such area based on the most recent publication by Equifax
Marketing Decision Systems, Inc. or any other publication as determined by
the Management Committee.
"Private Transferee" means a Person that acquires Economic
Interests from a Member in compliance with this Agreement, other than
pursuant to a broadly distributed underwritten registered public offering
or Rule 144 under the Securities Act, and that is not a member of an
Affiliate Group immediately prior to such acquisition.
"Profits" and "Losses" means, for each fiscal year or part
thereof, the Company's taxable income or loss for such year determined in
accordance with Section 703(a) of the Code (for this purpose, all items of
income, gain, loss and deduction required to be stated separately pursuant to
Section 703(a)(1) of the Code shall be included in taxable income or loss)
with the following adjustments:
(i) any income of the Company that is exempt from
federal income tax shall be added to such taxable income or loss;
12
<PAGE>
(ii) any expenditures of the Company described in
Section 705(a)(2)(B) of the Code or treated as such pursuant to
Treasury Regulation Section 1.704-1(b)(2)(iv)(i) shall be subtracted
from such taxable income or loss;
(iii) in lieu of the depreciation, amortization and
other cost recovery deductions taken into account in computing such
taxable income or loss, Depreciation for such fiscal year shall be
taken into account;
(iv) if the Book Value of any Company asset is
adjusted pursuant to clause (ii) or clause (iii) of the definition of
Book Value, the amount of such adjustment shall be taken into account
as gain or loss from the disposition of such asset for purposes of
computing Profits or Losses;
(v) to the extent an adjustment to the adjusted tax
basis of any Company asset under Section 734(b) of the Code is
required, pursuant to Treasury Regulation Section 1.704(b)(2)(iv)(m)(4),
to be taken into account in determining Capital Accounts as a result of
a distribution other than in liquidation of a Member's interest in the
Company, the amount of such adjustment shall be treated as an item of
gain (if the adjustment increases the adjusted tax basis of the asset)
or an item of loss (if the adjustment decreases the adjusted tax basis
of the asset) from the disposition of such asset and shall be taken
into account for purposes of computing Profits and Losses; and
(vi) such taxable income or loss shall not be deemed
to include items of income, gain, loss, or deduction allocated pursuant
to Section 3.1(c)(iii) (to comply with Treasury Regulations under
Section 704(b) of the Code), Section 4.3, Section 4.4 or Section 4.5.
"Prohibited Transferee" means any Person or group (as such
term is used in Sections 13(d) and 14(d) of the Exchange Act and the
regulations thereunder) or Affiliate thereof (other than AWS and its
Affiliates) that (a) is one of the five largest providers of wireless
Telecommunications Services (based on revenue derived from the provision of
such wireless Telecommunications Services during the most recent fiscal year
preceding the applicable Transfer for which such information is available) in
the United States or a company whose annual gross revenues from
Telecommunications Services (during the most recent fiscal year for which
such information is available) exceed $2 billion or (b) provides Company
Communications Services in service areas in the United States covering more
than five million Pops.
"Qualified Member" means each of (i) the members of the AWS
Member Group that are members of the AWS Affiliate Group, so long as the AWS
Member Group is a Qualified Member Group and (ii) the members of the DCC
Member Group that are members of the DCC Affiliate Group, so long as the DCC
Member Group is a Qualified Member Group.
13
<PAGE>
"Qualified Member Group" means each of (i) the AWS Member
Group as long as members of the AWS Affiliate Group that are members of the
AWS Member Group retain in the aggregate 100% of the Voting Interests, and at
least 80% of the Economic Interests, that AWS Sub acquired on the Effective
Date and (ii) the DCC Member Group as long as members of the DCC Affiliate
Group that are members of the DCC Member Group retain in the aggregate 100%
of the Voting Interests, and at least 80% of the Economic Interests, that DCC
Sub acquired on the Effective Date.
"Related Agreements" means the Long Distance Agreement, the
Operating Agreement, any Resale Agreement and the Management Agreement.
"Representative" is defined in Section 7.1(a).
"Resale Agreement" means a Resale Agreement, if any,
entered into between the Company and DCC pursuant to Section 8.1(a).
"Response" is defined in Section 8.11(c).
"RoFR Closing" is defined in Section 9.2(b).
"Section 9.9(a) Notice" is defined in Section 9.9(a).
"Section 9.9(b) Notice" is defined in Section 9.9(b).
"Section 9.9(c) Notice" is defined in Section 9.9(c).
"Section 9.10 Election" is defined in Section 9.10.
"Securities Act" means the Securities Act of 1933, as amended.
"Sellers" is defined in Section 9.2(a).
"Selling Group" is defined in Section 9.2(a).
"Senior Party Representatives" is defined in Section 8.11(b).
"Significant Matter" means, subject to Section 9.8(a)(iii),
any of the following:
(1) The sale, transfer, assignment or other disposition of any
material portion of the assets of the Company or any of its
Subsidiaries other than in the ordinary course of business;
(2) The merger, combination or consolidation of the Company or
any of its Subsidiaries with or into any entity other than the Company
or a wholly owned Subsidiary of the Company, regardless of whether the
Company or any such
14
<PAGE>
Subsidiary is the surviving entity in any such merger, combination or
consolidation; the acquisition of any businesses or assets for
consideration in excess of $1,000,000 by the Company; the formation
of any partnership or joint venture involving the Company; or the
liquidation, dissolution or winding up of the Company or any of its
Subsidiaries (other than the liquidation of a 100% Subsidiary of the
Company into the Company or another 100% Subsidiary of the Company);
(3) Any offering or issuance of securities or ownership
interests in the Company or any of its Subsidiaries, including, without
limitation, warrants, options or other rights convertible into or
exchangeable for securities or ownership interests in the Company or
any of its Subsidiaries, or the declaration of any dividends thereon;
(4) The repurchase by the Company or any of its Subsidiaries
of any securities or ownership interests in the Company or any of its
Subsidiaries, including, without limitation, warrants, options or other
rights convertible into or exchangeable for securities or ownership
interests in the Company or any of its Subsidiaries;
(5) The authorization or adoption of any amendment to the
certificate of formation, limited liability company agreement or any
other constituent document of the Company or any of its Subsidiaries,
or the conversion of the Company to a corporation (other than pursuant
to an election to effect an IPO in accordance with Section 8.10);
(6) If the Company is not managed by an Affiliate of DCC, the
hiring or termination of any executive officer of the Company;
(7) The approval of, or material amendment to, the initial
three-year budget, and any annual or other operating or capital budget,
of the Company or any of its Subsidiaries;
(8) The incurrence by the Company or any of its Subsidiaries,
whether directly or indirectly, of any indebtedness for borrowed money
or capital leases in any calendar quarter in excess of $1,000,000
unless specifically provided for in any budget approved by the
Management Committee;
(9) Any agreement or arrangement, written or oral, to pay any
director, officer, agent or employee of the Company or any of its
Subsidiaries $200,000 or more on an annual basis; or any loan, lease,
contract or other transaction with any employee of the Company or any
of its Subsidiaries with an annual salary in excess of $200,000, or
with any Representative or officer of the Company or any member of any
such Person's Immediate Family, unless specifically provided for in any
budget approved by the Management Committee;
15
<PAGE>
(10) The making of, or commitment to make, any capital
expenditures involving a payment or liability in any one year of
$1,000,000 or more in the aggregate by the Company or any of its
Subsidiaries, in each case other than as provided for in any budget
approved by the Management Committee;
(11) The initiation of any bankruptcy proceeding, dissolution
or liquidation of the Company or any of its Subsidiaries;
(12) Any agreement or commitment by the Company or any of its
Subsidiaries (w) not to compete with any other Person, (x) not to
solicit any other Person's business or customers, (y) not to solicit or
hire any other Person's employees, or (z) to use any other Person's
trademarks or services marks in its business, or to license or
otherwise make available any of its trademarks or service marks to any
other Person for any purpose;
(13) The provision by the Company or any of its Subsidiaries
of Company Communications Services that are not Mobile Wireless
Services;
(14) The assertion by the Company of a position with respect
to any material matter, or the disagreement by the Company with a
position taken with respect to any material matter by a Member or any
other Person, before the FCC or any other Governmental Authority, a
self-regulatory body, any industry organization or in any other public
forum;
(15) The acquisition or disposition of any License issued by
the FCC;
(16) Except as otherwise provided herein or therein, any
amendment, modification, renewal or termination of any of the Related
Agreements; and
(17) The entering into any contract, agreement or commitment
to do any of the foregoing.
"Specified Restrictions" is defined in Section 9.4.
"Subsidiary" means, with respect to any Person, a
corporation or other entity of which 50% or more of the voting power of the
Voting Securities or equity interests is owned, directly or indirectly, by
such Person.
"Tax Matters Partner" is defined in Section 6.5(d).
"TDMA" means the North American Time Division Multiple
Access standard set by the Telecommunications Industry Association,
IS-54/136, and any standard that is based upon, or is an upgrade from, or is
a successor to, such standard, and is adopted by AWS Sub and its Affiliates
in a majority of their network nodes.
16
<PAGE>
"TDMA Quality Standards" means the quality standards
applicable to PCS Systems and Cellular Systems that utilize TDMA and that are
owned and operated by AT&T and its Affiliates, which will be set forth in a
schedule to the Operating Agreement, as the same may be amended from time to
time, provided any such amended standards shall become effective 120 days
after notice thereof is given to the Company and DCC.
"Telecommunications Services" means the offering of
telecommunications services for a fee directly to the public, or to such
classes of users as to be effectively available directly to the public,
regardless of the facilities used. The term "telecommunications" means the
transmission, between or among points specified by the user of information of
the user's choosing.
"Territory" means, subject to Section 8.12, the geographic
territory set forth on Schedule III hereto.
"Transfer" means assign, bequeath, convey, create or suffer
to exist a Lien upon, encumber, gift, grant, hypothecate, issue, mortgage,
place in trust, pledge, sell, transfer or otherwise dispose of, in each case
whether directly or indirectly, voluntarily or involuntarily (including by
testamentary or intestate succession), by operation of law or otherwise.
"Treasury Regulations" means regulations issued by the
United States Department of the Treasury pursuant to the Code.
"Voting Interest" means the right of a Member to exercise
governance rights with regard to the Company (including the right to appoint
Representatives to the Member Committee). The term "Voting Interest"
specifically excludes Economic Interest.
"Voting Securities" means equity securities of a Person
having the right to vote generally in the election of the directors (or
persons performing equivalent functions) of such Person.
ARTICLE 2
ORGANIZATION
2.1 NAME. The name of the Company shall be ACC
Acquisition LLC. The name of the Company may be changed from time to time by
the Management Committee with notice to the Members.
2.2 PRINCIPAL PLACE OF BUSINESS. The Company's principal
office and place of business shall be located in Oklahoma City, Oklahoma. The
principal office and place of business may be changed from time to time, and
other offices and places of business may be established from time to time,
both within and without the State of Delaware, by the Management Committee
with notice to the Members.
17
<PAGE>
2.3 REGISTERED OFFICE; REGISTERED AGENT. The address of
the registered office of the Company in the State of Oklahoma shall be 13439
North Broadway Extension, Oklahoma City, Oklahoma 73114 or such other address
as the Management Committee may determine. The registered agent for service
of process on the Company in the State of Oklahoma shall be Everett R.
Dobson, or such other agent as the Management Committee may determine. The
name and address of the registered agent for service of process on the
Company in the State of Delaware shall be Corporation Service Company, 1013
Centre Road, Wilmington, Delaware 19805.
2.4 TERM. The term of the Company commenced on September
15, 1999 and, unless terminated in accordance with this Agreement, shall be
perpetual.
2.5 PURPOSE AND POWERS.
(a) The purposes of the Company are to (i) establish and
conduct the Business; (ii) enter into the Related Agreements to which the
Company is a party; and (iii) do any and all things reasonably necessary or
advisable in connection with the foregoing. The Company shall have the power and
authority to take any and all actions necessary or advisable to or for the
furtherance of said purposes.
(b) The foregoing provisions of this Section 2.5 shall
not be construed to authorize the Company to, and the Company shall not, and
the Members agree that the Company shall not, engage in any activities other
than the foregoing (and in particular expand or change the scope of the
Business beyond that contemplated by the definition thereof) without the
consent of the Management Committee.
2.6 FILINGS. The Management Committee shall cause to be
executed, filed and published all such certificates, notices, statements or
other instruments, and amendments thereto under the laws of the State of
Delaware and other applicable jurisdictions as the Management Committee may
deem necessary or advisable for the operation of the Company.
2.7 SOLE AGREEMENT. The parties intend that their
obligations to each other with respect to the Company and the scope of their
joint enterprise be as set forth in this Agreement and the Related
Agreements, and that no further authority to bind the other or the Company or
any liabilities to each other or any third party be inferred from the
relationships described in such agreements.
ARTICLE 3
CAPITALIZATION
3.1 CAPITAL ACCOUNTS.
(a) ESTABLISHMENT. A separate capital account ("Capital
Account") is
18
<PAGE>
hereby established for each Member as of the Effective Date.
(b) GENERAL RULES FOR ADJUSTMENT OF CAPITAL ACCOUNTS. The
Capital Account of each Member shall be:
(i) increased by:
(A) the aggregate amount of such Member's cash
contributions to the Company;
(B) the initial Book Value of property
contributed by such Member to the Company,
net of liabilities secured by such property
that the Company is considered to assume or
take subject to Section 752 of the Code and
the Treasury Regulations promulgated
thereunder;
(C) such Member's distributive share of Profits
and items of income and gain allocated to
such Member pursuant to Section 3.1(c)(iii)
or Section 4.3;
(D) any positive adjustment to such Capital
Account by reason of an adjustment to the
Book Value of the Company assets; and
(E) the amount of Company liabilities assumed by
such Member or which are secured by any
property distributed to such Member; and
(ii) decreased by:
(A) cash distributions to such Member from the
Company;
(B) the Book Value of property distributed in
kind to such Member, net of liabilities
secured by such property that such Member is
deemed to assume or take subject to Section
752 of the Code and the Treasury Regulations
promulgated thereunder;
(C) such Member's distributive share of Losses
and items of loss or deduction allocated to
such Member pursuant to Section 3.1(c)(iii)
or Section 4.3 ;
(D) any negative adjustment to such Capital
Account by reason of an adjustment to the
Book Value of Company assets;
19
<PAGE>
(E) any amount charged to the Capital Account of
such Member pursuant to Section 6.5(e); and
(F) the amount of any liabilities of such Member
assumed by the Company or which are secured
by property contributed by such Member to
the Company.
(c) SPECIAL RULES.
(i) TIME OF ADJUSTMENT FOR CAPITAL CONTRIBUTIONS. For
purposes of computing the balance in a Member's Capital Account, no
credit shall be given for any capital contribution which such Member
is obligated to make until such contribution is actually made.
(ii) CAPITAL ACCOUNT FOR TRANSFERRED INTEREST. If any
Interest in the Company or part thereof is Transferred 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 Interest.
(iii) INTENT TO COMPLY WITH TREASURY REGULATIONS. The
foregoing provisions and the other provisions of this Agreement
relating to the maintenance of Capital Accounts are intended to comply
with Treasury Regulation Section 1.704-1(b), and shall be interpreted
and applied in a manner consistent with such regulation. To the extent
the provisions of this Agreement are inconsistent with such regulation
or are incomplete with respect thereto, the Capital Accounts of the
Members shall be maintained in accordance with such regulation except
to the extent that doing so would materially distort the timing or
amount of an allocation or distribution to a Member.
3.2 CAPITAL CONTRIBUTIONS.
(a) On the Effective Date, each of AWS Sub and DCC Sub
shall contribute $372.5 million in cash to the capital of the Company, and
the Company shall accept such capital contributions. After giving effect to
such capital contributions, AWS Sub and DCC Sub shall each own 50% of the
Economic Interests and 50% of the Voting Interests.
(b) No Member shall be required or permitted to make any
additional capital contributions to the Company without the unanimous
approval of the Management Committee.
3.3 NO WITHDRAWALS. Except as expressly set forth herein,
no Member shall be entitled to withdraw any portion of its capital
contribution or Capital Account balance.
20
<PAGE>
3.4 NO INTEREST. Except as expressly set forth herein, no
Member shall be entitled to receive any interest on its capital contribution or
Capital Account balance.
ARTICLE 4
PROFITS AND LOSSES
4.1 PROFITS. Except as provided in Sections 4.2 through
4.5, Profits and Losses with respect to any fiscal year shall be allocated to
the Members in accordance with their respective Economic Interests.
4.2 LOSSES.
(a) GENERAL RULE. After giving effect to the special
allocations set forth in Section 4.3 and 4.4, subject to Section 4.2.(b), Losses
with respect to any fiscal year shall be allocated to the Members in accordance
with their respective Economic Interests.
(b) LIMITATION ON LOSSES. Losses allocated to any Member
pursuant to Section 4.1 with respect to any fiscal year shall not exceed the
maximum amount of Losses that may be so allocated without causing such Member to
have an Adjusted Capital Account Deficit at the end of such fiscal year. All
Losses in excess of the limitation set forth in this Section 4.2 shall be
allocated: first, to the Members that will not be subject to this limitation,
ratably based on the aggregate of their Economic Interests, to the extent
possible until such Members become subject to this limitation; and any remaining
amount, to the Members, ratably based on their Economic Interests, unless
otherwise required by the Code or Treasury Regulations. To the extent that any
Member receives an allocation of Losses pursuant to this Section 4.2, such
Member shall receive a priority allocation of Profits (prior to an allocation of
Profit made pursuant to Section 4.1) in the reverse order of such Loss
allocations in order to reverse the effect of this Section 4.2.
4.3 SPECIAL ALLOCATIONS. The following special
allocations shall be made for any fiscal year of the Company in the following
order of priority:
(a) QUALIFIED INCOME OFFSET. Notwithstanding anything
herein to the contrary, but only if required by Treasury Regulation Section
1.704-1(b) in order for the allocations provided for herein to be considered
to have substantial economic effect or to be deemed to be in accordance with
the Member's Economic Interests, if, for any fiscal year, a Member
unexpectedly receives an adjustment, allocation or distribution described in
Treasury Regulation Sections 1.704-1(b)(2)(ii)(d)(4), (5) or (6), and such
adjustment, allocation or distribution causes or increases an Adjusted
Capital Account Deficit with respect to such Member, then, before any other
allocations are made, such Member shall be allocated items of income and gain
(consisting of a pro rata portion of each item of Company income, including
gross income and gain) in the amount and manner sufficient to eliminate such
Adjusted Capital Account Deficit as quickly as possible. This Section 4.3(a)
is intended
21
<PAGE>
to comply with Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be
interpreted consistently therewith.
(b) MINIMUM GAIN CHARGEBACK. Notwithstanding any other
provision of this Article 3, if there is a net decrease in Company Minimum Gain
during any fiscal year, each Member shall, subject to the exceptions provided in
Treasury Regulation Section 1.704-2(f), be specially allocated items of income
and gain for such fiscal year (and, if necessary, subsequent fiscal years) equal
to such Member's share of the net decrease in Company Minimum Gain within the
meaning of Treasury Regulation Section 1.704-2(g)(2). Allocations pursuant to
the previous sentence shall be made in proportion to the respective amounts
required to be allocated to each Member pursuant thereto. The items to be so
allocated shall be determined in accordance with Treasury Regulation Sections
1.704-2(6) and 1.704-2(i)(2). To the extent that this Section 4.3(b) is
inconsistent with Treasury Regulation Section 1.704-2(f), the Minimum Gain
Chargeback provided for herein shall be applied and interpreted in accordance
with such Treasury Regulation.
(c) MEMBER MINIMUM GAIN CHARGEBACK. If there is a net
decrease in Member Minimum Gain attributable to a Member Nonrecourse Debt
during any Company fiscal year, within the meaning of Treasury Regulation
Sections 1.704-2(i)(3) and 1.704-2(k), each Member that, as of the beginning
of such year, has a share of the Member Minimum Gain attributable to such
Member Nonrecourse Debt, determined in accordance with Treasury Regulation
Section 1.704-2(i)(5), shall be specially allocated items of income and gain
for such fiscal year (and, if necessary, subsequent fiscal years) in an
amount equal to such Member's share of the net decrease in Member Nonrecourse
Debt determined in accordance with Treasury Regulation Section 1.704-2(i)(4).
Allocations pursuant to the previous sentence shall be made in proportion to
the respective amounts required to be allocated to each Member pursuant
thereto. The items to be so allocated shall be determined in accordance with
Treasury Regulation Sections 1.704-2(i)(4) and 1.704-2(i)(2). To the extent
that this Section 4.3(c) is inconsistent with Treasury Regulation Section
1.704-2(i), the Member Minimum Gain chargeback provided for herein shall be
applied and interpreted in accordance with such regulation.
(d) NONRECOURSE DEDUCTIONS. Nonrecourse Deductions shall
be allocated to the Members in accordance with their respective Economic
Interests.
(e) MEMBER NONRECOURSE DEDUCTIONS. Any Member Nonrecourse
Deductions for any fiscal year or other period shall be allocated to the
Member that bears the economic risk of loss with respect to the Member
Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable
in accordance with Treasury Regulation Section 1.704-2(i).
4.4 CURATIVE ALLOCATIONS. The allocations set forth in
Sections 4.3(a) through 4.3(e) are intended to comply with certain regulatory
requirements under Section 704(b) of the Code. 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
22
<PAGE>
other allocations pursuant to Section 4.3 or with special allocations of
other items of Company income, gain, loss, or deduction pursuant to this
Section 4.4. Accordingly, the Management Committee is hereby authorized and
directed to make offsetting allocations of Company income, gain, loss or
deduction under this Section 4.4 in whatever manner the Management Committee
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 Section 4.3(b) and Section 4.3(c))
the Capital Accounts of the Members are, to the extent possible, equal to the
Capital Accounts each would have if the provisions of Section 4.3 were not
contained in this Agreement and all income, gain, loss and deduction of the
Company were instead allocated pursuant to Section 4.1 and Section 4.2.
4.5 SPECIAL ALLOCATIONS IN THE EVENT OF COMPANY AUDIT
ADJUSTMENTS. Notwithstanding the allocation provisions of Section 4.1 and
Section 4.2, and prior to making any of the allocations specified in Section
4.3, the following special allocations shall be made in the following order
and in a manner, taking into consideration any tiered partnership structure
that the Company may be part of, that reflects the relative economic
interests of each Member in the Company:
(a) If for any fiscal year of the Company, the Company or
any Affiliate of the Company is deemed to have additional income for tax
purposes as a result of a redetermination by a taxing authority of an item of
income, gain, loss or deduction that is attributable to a loan transaction,
the provision of services, or the grant of a license or sublicense in
intangible property by the Company or any Affiliate of the Company, to or
involving any Member or Affiliate of any Member, such additional income shall
be allocated to the Member involved in such loan transaction or that received
such services, license or sublicense (or the Member whose Affiliate was
involved in such loan transaction or received such services, license or
sublicense) and any related deemed cash distribution shall be treated as
having been made to the same Member.
(b) If for any fiscal year of the Company, the Company or
any Affiliate of the Company is deemed to have a reduction in income for tax
purposes as a result of a redetermination by a taxing authority of an item of
income, gain, loss or deduction that is attributable to a loan transaction,
the provision of services, or the grant of a license or sublicense in
intangible property by the Company or any Affiliate of the Company, to or
involving any Member or Affiliate of any Member, such reduction in income
shall be allocated to the Member involved in such loan transaction or that
received such services, license or sublicense (or the Member whose Affiliate
was involved in such loan transaction or received such services, license or
sublicense) and any related deemed cash contribution shall be treated as
having been made by the same Member.
(c) If for any taxable period of a Member, such Member or
any Affiliate of the Member is deemed to have additional income for tax
purposes as a result of a redetermination by a taxing authority of an item of
income, gain, loss or deduction attributable to a loan transaction, the
provision of services, or the grant of a license or sublicense in intangible
property by such Member or any Affiliate of such Member, to or
23
<PAGE>
involving the Company or any Affiliate of the Company, any increase in the
amount of a Company deduction associated with such redetermination of such
Member's or any Affiliate of such Member's income shall be allocated (in the
appropriate fiscal year) to the Member involved in such loan transaction or
that provided such services, license or sublicense (either directly or
through an Affiliate), and any related deemed cash contribution shall be
treated as having been made by the same Member.
(d) If for any taxable period of a Member, such Member or
any Affiliate of the Member is deemed to have a reduction in income for tax
purposes as a result of a redetermination by a taxing authority of an item of
income, gain, loss or deduction attributable to a loan transaction, the
provision of services, or the grant of a license or sublicense in intangible
property by such Member or any Affiliate of such Member, to or involving the
Company or any Affiliate of the Company, any reduction in the amount of a
Company deduction associated with such redetermination of such Member's or
any Affiliate of such Member's income shall be allocated (in the appropriate
fiscal year) to the Member involved in such loan transaction or that provided
such services, license or sublicense (either directly or through an
Affiliate), and any related deemed cash distribution shall be treated as
having been made to the same Member.
(e) A redetermination by a taxing authority shall only be
given effect for purposes of this Section 4.5 if such redetermination is (i)
a decision, judgment, decree or other order by any court of competent
jurisdiction, which has become final and is either no longer subject to
appeal or for which a determination not to appeal has been made; (ii) a
closing agreement made under Section 7121 of the Code or any comparable
foreign, state, local or other income tax statute; (iii) a final disposition
by a taxing authority of a claim for refund; or (iv) any other written
agreement made with respect to a tax redetermination the execution of which
is final and prohibits the taxing authority, relevant Member (or any
Affiliate of such Members) or the Company (or any Affiliate of the Company)
from seeking any further legal or administrative remedies with respect to
such tax redetermination.
4.6 ALLOCATION OF CREDITS. All tax credits shall be
allocated among the Members in accordance with their respective Interests or
in accordance with applicable provisions of the Code or Treasury Regulations
to the extent any such provision is inconsistent with such allocation.
4.7 TAX ALLOCATIONS.
(a) CONTRIBUTED PROPERTY. In the event any property is
contributed to the capital of the Company, income, gain, loss and deduction with
respect to such property shall be allocated solely for tax purposes among the
Members in accordance with Section 704(c) of the Code and Treasury Regulation
Section 1.704-3 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. 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 Management
24
<PAGE>
Committee shall agree upon the allocation method to be applied with respect
to that property under Treasury Regulation Section 1.704-3, which allocation
method shall be set forth on attached Schedule 4.7, as amended from time to
time.
(b) REVALUED PROPERTY. If the Company assets are revalued
as set forth in the definition of "Book Value," subsequent allocations of
income, gain, loss and deduction with respect to revalued Company assets
shall take into account any variation between the adjusted basis of such
assets for federal income tax purposes and their adjusted value in the same
manner as under Section 704(c) of the Code and in compliance with Treasury
Regulation Section 1.704-3. All decisions regarding the choice of allocation
method under Treasury Regulation Section 1.704-3 with respect to revalued
Company assets shall be made by the Management Committee.
4.8 CHANGE IN MEMBER'S INTERESTS. In the event there is any
change in the Members' respective Economic Interests during any fiscal year,
Profits, Losses, Nonrecourse Deductions and other items shall be allocated among
the Members in accordance with their respective Economic Interests from time to
time during such fiscal year in accordance with Section 706 of the Code, using
any convention permitted by law and selected by the Management Committee.
ARTICLE 5
DISTRIBUTIONS
5.1 DISTRIBUTABLE CASH. It shall be the policy of the
Company, and the Members shall direct their respective Representatives on the
Management Committee to cause the Company, to distribute Distributable Cash
to the Members quarterly. Any distributions of such Distributable Cash shall
be made to the Members in accordance with their respective Economic
Interests. Notwithstanding the foregoing or any other provision of this
Agreement to the contrary, the Company, and the Members, Management Committee
and Representatives on behalf of the Company, shall not be required to make
any distribution to any Member on account of such Member's interest in the
Company if such distribution would violate the Act or other applicable law.
5.2 LIQUIDATING DISTRIBUTIONS. Distributions to the
Members of cash or property in connection with a dissolution of the Company
shall be made in accordance with the Capital Account balances of the Members,
as provided in Section 10.3(d)(ii).
5.3 OTHER DISTRIBUTIONS. No Member shall be entitled to
receive any distribution from the Company without the consent of the
Management Committee or as otherwise provided in Section 5.1 or 10.3(d).
ARTICLE 6
ACCOUNTING AND RECORDS
25
<PAGE>
6.1 FISCAL YEAR. The fiscal year of the Company shall be
the year ending December 31.
6.2 METHOD OF ACCOUNTING. Unless otherwise provided
herein, the Company books of account shall be maintained in accordance with
GAAP; provided that for purposes of making allocations with respect to items
of Company income, gain, deduction, loss and credit to the Members, such
items shall be allocated to the Members' Capital Accounts pursuant to Article
4 and as required by Section 704 of the Code and the Treasury Regulations
promulgated thereunder.
6.3 BOOKS AND RECORDS; INSPECTION.
(a) BOOKS OF ACCOUNT AND RECORDS. Proper and complete
records and books of accounts of the Company business for tax and financial
purposes, including all such transactions and other matters as are usually
entered into records and books of account maintained by Persons engaged in
businesses of like character or as are required by law, shall be kept by the
Company at the Company's principal office and place of business. The
Management Committee may delegate to a third party or any Member the duty to
maintain and oversee the preparation and maintenance of such records and
books of account. Books and records maintained for financial purposes shall
be maintained in accordance with GAAP, and books and records maintained for
tax purposes shall be maintained in accordance with the Code and applicable
Treasury Regulations.
(b) INSPECTION. All records and documents described in
Section 6.3(a) shall be open to inspection and copying by any of the Members
or their Representatives or agents, subject to applicable confidentiality
restrictions, at any reasonable time during normal business hours.
Notwithstanding anything in the Act or this Agreement to the contrary, the
Members and the Representatives shall not have the right to keep confidential
from any other Member or Representative, in their capacities as such, any
information of the Company.
6.4 FINANCIAL STATEMENTS. Within 90 days after the end of
each fiscal year, and 60 days after the end of each calendar quarter, the
Management Committee shall cause to be furnished to each Member financial
statements with respect to such fiscal year or quarter of the Company,
consisting of (i) a balance sheet showing the Company's financial position as
of the end of such fiscal year or quarter, (ii) supporting profit and loss
statements, (iii) a statement of cash flows for such year or quarter and (iv)
Member's Capital Accounts, provided that prior to such dates the Company
shall provide to each Member on a timely basis such financial information as
may be required to permit each Member Group to prepare its annual and
quarterly financial reports. The annual financial statements of the Company
shall, unless the Members determine otherwise by unanimous consent, be
audited (which audit shall be conducted in accordance with GAAP) and
certified by an independent firm of certified public accountants selected by
the Management Committee or the Members (which firm may be the firm regularly
engaged by any one or more of the Members). The Members hereby designate and
appoint the firm of Arthur Andersen, LLP as the Company's
26
<PAGE>
independent public accountants, such designation and appointment to remain
effective until terminated by the Management Committee and appointment of
replacement independent public accountants. Each Member shall receive a copy
of all material financial reports and notices delivered by the Company to any
third party pursuant to any other agreement. The Company shall also produce
and distribute to all Members monthly revenue, operating expense and capital
expenditure reports and such other financial statements as the Management
Committee reasonably determines.
6.5 TAXATION.
(a) STATUS OF THE COMPANY. The Members acknowledge that
this Agreement creates a partnership for federal income tax purposes.
Furthermore, the Members hereby agree not to elect to be excluded from the
application of Subchapter K of Chapter 1 of Subtitle A of the Code or any
similar state statute.
(b) TAX ELECTIONS AND REPORTING.
(i) GENERALLY. The Company shall make the following
elections and take the following positions under United States income
tax laws and Treasury Regulations and any similar state laws and
regulations:
(A) Adopt the year ending December 31 as the
annual accounting period (unless otherwise
required by the Code and Treasury
Regulations);
(B) Adopt the accrual method of accounting;
(C) Insofar as permissible, report the Company's
tax attributes and results using principles
consistent with those assumed in connection
with entering into this Agreement; and
(D) Have the Company treated as a partnership
for federal income tax purposes in a manner
consistent with Treasury Regulation Section
1-7701 ("Check the Box Regulations").
(ii) CODE SECTION 754 ELECTION. The Management Committee
shall, upon the written request of any Member, cause the Company to
file an election under Section 754 of the Code and the Treasury
Regulations promulgated thereunder to adjust the basis of the Company's
assets under Section 734(b) or 743(b) of the Code and a corresponding
election under the applicable sections of state and local law.
(c) COMPANY TAX RETURNS.
27
<PAGE>
(i) The Tax Matters Partner will prepare or cause to be
prepared all required domestic and foreign tax returns and information
returns of the Company, drafts of which shall be furnished to the
Members within 120 days following the close of each fiscal year. Such
returns will be prepared at no charge to the Company, except for all
reasonable out-of-pocket expenses (including accounting fees, if any).
Either Member may, at its own expense, engage a third party to review
the tax returns and information returns prepared by the Tax Matters
Partner pursuant to the preceding sentence. The Tax Matters Partner
shall not file any such return without the approval of any Member that
constitutes a "notice partner" (as defined in Section 6231(a)(8) of the
Code) of the Company, which approval shall not be unreasonably
withheld. Such "notice partner" member shall be deemed to have given
such approval if such Member does not indicate its written objection
(which may be delivered by facsimile) to the Tax Matters Partner within
45 days of the date that such Member receives a draft of such return.
If a "notice partner" Member does not approve of any proposed filing of
a return by the Tax Matters Partner, such Member and the Tax Matters
Member shall seek, in good faith, to resolve their disagreement. If a
"notice partner" Member and the Tax Matters Partner cannot resolve
their disagreement within 10 days of receipt of such written notice by
the Tax Matters Partner, either of such Member or the Tax Matters
Partner may request, in writing with a copy sent to the other party,
that the disagreement be resolved by the Company's independent public
accountants and the independent public accountants shall be instructed
to resolve the dispute in such manner as they believe will maximize, in
the aggregate, the U.S. federal, state and local income tax advantages
and will minimize, in the aggregate, the U.S. federal, state, and local
income tax detriments, available to the Company's Members. The
independent public accountants shall provide their written resolution
of the disagreement to both the "notice partner" Member and the Tax
Matters Partner within 15 days from the date that the independent
public accountants were requested to resolve such disagreement. Any and
all other tax returns shall be prepared in a manner directed by the Tax
Matters Partner consistent with the terms of this Agreement. Each
Member shall provide such information, if any, as may be reasonably
requested by the Company for purposes of preparing such tax and
information returns.
(ii) The Tax Matters Partner shall furnish a copy of all
filed domestic foreign tax returns and information returns for the
Company to each of the Members. In addition, upon reasonable written
notice provided to the Company by a Member (and as otherwise required
by law), the Company shall furnish such Member, on a timely basis, with
all information relating to the Company required to be reported in any
U.S. federal, state or local tax return of such Member, including a
report indicating such Member's allocable share for U.S. federal income
tax purposes of the Company's income, gain, credits, losses and
deductions.
(iii) The Members agree that the Company shall be treated as a
partnership for U.S. federal income tax purposes. The Members agree to
(A) approve electing
28
<PAGE>
partnership status with respect to the Company with the U.S. Internal
Revenue Service and such other state and local taxing authorities as
may be appropriate and to cooperate in providing all consents,
signatures, documents and such other information as may be required
with respect thereto; and (B) report all "partnership items" (as
defined in Section 6231(a)(3) of the Code) of the Company consistent
with such classification of the Company for U.S. federal, state and
local tax purposes and with the returns filed by the Company; provided,
however, that if any Member intends to file a notice of inconsistent
treatment under Section 6222(b) of the Code, such Member shall at least
30 days prior to the filing of such notice, notify in writing the other
Members of such intent and such Member's intended treatment of the item
which is (or may be) inconsistent with the treatment of that item by
the Company.
(d) TAX AUDITS. DCC Sub, so long as it is a Qualified
Member (or, from and after a Change of Control of DCC, AWS Sub, so long as it
is a Qualified Member) shall be the "tax matters partner" of the Company, as
that term is defined in Section 6231(a)(7) of the Code (the "Tax Matters
Partner"), with all of the rights, duties and powers provided for in sections
6221 through 6232, inclusive, of the Code, provided that the Tax Matters
Partner shall not pay or agree to pay any audit assessment, or any amount in
settlement or compromise of any litigation, in respect of income tax
liability of the Members attributable to the Interests in the Company, in
excess of $500,000 in any one instance or series of related instances, unless
approved by the Management Committee. The Tax Matters Partner, as an
authorized representative of the Company, shall direct the defense of any tax
claims made by the Internal Revenue Service or any other taxing jurisdiction
to the extent that such claims relate to adjustment of Company items at the
Company level and, in connection therewith, shall retain and cause the
Company to pay the fees and expenses of counsel and other advisors chosen by
the Tax Matters Partner. The Tax Matters Partner shall also be responsible
for filing a timely election on Form 8832 and for timely filing for all other
elections made by the Company. The Tax Matters Partner shall deliver to each
Member and the Management Committee a semi-annual report on the status of all
tax audits and open tax years relating to the Company, and shall consult with
and keep all Members and the Management Committee advised of all significant
developments in such matters coming to the attention of the Tax Matters
Partner. All reasonable expenses of the Tax Matters Partner and its
Affiliates (including reasonable internal time charges and reasonable
disbursements) and other reasonable fees and expenses in connection with such
defense shall be borne by the Company. Except as provided in Article 11,
neither the Tax Matters Partner nor the Company shall be liable for any
additional tax, interest or penalties payable by a Member or any costs of
separate counsel chosen by such Member to represent the Member with respect
to any aspect of such defense. The Tax Matters Partner shall take any steps
necessary pursuant to Section 6223(a) to designate AWS Sub as a "notice
partner" (as defined in Section 6231(a)(8) of the Code). In addition, nothing
in this Agreement is intended to waive any rights, including rights to
participate in administrative and judicial proceedings, that a Member may
have under Section 6221 through 6233 of the Code. Notwithstanding any other
provisions of this Agreement, the provisions of Sections 6.5(c) and 6.5(d)
shall survive the dissolution of the Company or the termination of any
Member's interest in the Company and shall remain binding on all Members for
a period of time necessary to resolve with the U.S.
29
<PAGE>
Internal Revenue Service or any applicable state or local taxing authority
all matters (including litigation) regarding the U.S. Federal, state and
local income taxation, as the case may be, of the Company or any Member with
respect to the Company.
(e) WITHHOLDING.
(i) The Company shall comply with all withholding
requirements under U.S. federal, state, local and foreign tax laws
and shall remit amounts withheld to, and file required forms with,
the applicable taxing authorities. To the extent that the Company
withholds and pays over any amounts to any taxing authority with
respect to distributions or allocations to any Member, the amount
withheld shall be charged to the Capital Account of such Member. The
Company shall notify each of the Members of any withholding with
respect to such Member, designating such Member's allocable share of
such withholding tax. The Members hereby agree that they will not
claim a credit in excess of the amount in such notice.
(ii) In the event of any claimed overwithholding by the
Company, the Member shall have no rights against the Company or any
other Member. Anything in the previous sentence to the contrary
notwithstanding, if the Company is required to take any action in order
to secure a refund or credit for the benefit of a Member in respect of
any amount withheld by it, it will take any such action including,
without limitation, applying for such refund on behalf of the Member
and paying it over to such Member.
(iii) Except in the case of withholding pursuant to Section
1446 of the Code, if any amount required to be withheld was not
withheld from actual distributions made to a Member, the Company shall
require the Member to which the withholding was credited to reimburse
the Company for such withholding; in the case of withholding pursuant
to Section 1446 of the Code, no such reimbursement will be necessary as
long as the other Members are subject to withholding in amounts
proportionate to their Economic Interests in the Company or otherwise
receive a distribution of an equivalent amount.
(iv) In the event of any underwithholding by the Company,
each Member agrees to indemnify and hold harmless the Company and
the Tax Matters Member from and against any liability, including
interest and penalties, with respect thereto.
(v) Each Member agrees to furnish the Company with any
representations and forms as shall reasonably be requested by the
Company to assist the Company in determining the extent of, and in
fulfilling, the Company's withholding obligations.
30
<PAGE>
ARTICLE 7
MANAGEMENT
7.1 MANAGEMENT COMMITTEE. The property, business and affairs
of the Company shall be managed by or under the direction of a Management
Committee (the "Management Committee"). In addition to the powers and
authorities by this Agreement expressly conferred upon it, the Management
Committee may exercise all such powers of the Company and do all such lawful
acts and things as are not by statute or by this Agreement directed or required
to be exercised or done by the Members. Except as determined by the Management
Committee pursuant to this Article 7 or otherwise pursuant to this Agreement, no
Member or Representative shall have any right or authority to take any action on
behalf of the Company with respect to third parties or to bind the Company.
(a) NUMBER OF REPRESENTATIVES. The Management Committee
shall consist of four individuals (each, a "Representative"). So long as the
AWS Member Group is a Qualified Member Group, except as otherwise provided in
Section 8.12, AWS Sub (or another Member designated by a majority in Voting
Interests of the AWS Member Group) shall have the right to appoint two
Representatives, each of whom shall be employees of AWS or its Affiliates. So
long as the DCC Member Group is a Qualified Member Group, except as otherwise
provided in Section 9.8(a)(ii), DCC Sub (or another Member designated by a
majority in Voting Interests of the DCC Member Group) shall have the right to
appoint two Representatives, each of whom shall be employees of DCC or its
Affiliates. If a Member Group loses the right to appoint two Representatives,
the size of the Management Committee shall be reduced to two members, who
shall be appointed by the other Member Group. The Representatives shall not
be "managers" of the Company as such term is used in the Act.
(b) INITIAL REPRESENTATIVES. The initial Representatives
are:
DCC Member Group: Everett R. Dobson
Bruce R. Knooihuizen
AWS Member Group: Don Adams
Lee Maschmann
(c) VACANCIES. Each Representative shall hold office until
death, resignation or removal, with or without cause, by the Member Group which
appointed such Representative. If a vacancy occurs on the Management Committee,
the Member Group that appointed the vacating Representative shall (so long as
such Member Group has not lost the right to appoint two Representatives pursuant
to Section 7.1(a)) appoint such Representative's successor.
31
<PAGE>
7.2 MEETINGS OF MANAGEMENT COMMITTEE.
(a) REGULAR MEETINGS. The Management Committee shall meet at
least four times per year. Such meetings shall be held on such dates and at such
times and places as may be determined by the Representatives.
(b) SPECIAL MEETINGS. A special meeting of the Management
Committee or the Members shall be held at the request of any Representative.
Such meeting shall be held on the date and at the time and place set forth in
the notice of meeting.
(c) TELEPHONIC MEETINGS. Any meeting of the Management
Committee or the Members may be held by conference telephone call or through
similar communications equipment by means of which all persons participating in
the meeting can hear and be heard by each other. Participation in such a
telephonic meeting shall constitute presence in person at such meeting.
(d) NOTICES. Notices of regular meetings and special
meetings of the Management Committee or the Members may be given by any
Representative, and shall state the date, hour and purpose of the meeting.
All such notices shall be accompanied by an agenda for the meetings, as well
as (to the extent practicable) the texts of all resolutions proposed to be
adopted at such meetings. No item may be discussed if not on the agenda
unless a quorum is present and the Representatives present waive notice of
the additional item(s). Notice of a regular or special meeting shall be given
by facsimile, confirmed by certified mail, return receipt requested not less
than 14 days (in the case of a regular meeting) or 72 hours (in the case of a
special meeting) before the date of the meeting to each Representative at the
facsimile number and address provided by the Representative to the Company
from time to time. Any Representative may waive, as to such Representative
only, in writing, the requirements for notice before, at or after a meeting.
Any Representative who attends a meeting without objecting at the meeting to
the Company's failure to comply with the notice requirements in respect of
such meeting shall be deemed to have waived such requirements.
(e) QUORUM. At each meeting of the Management Committee
or the Members, the presence in person or by telephone of at least one
Representative of each Member Group shall be necessary to constitute a quorum
for the transaction of business.
(f) WRITTEN CONSENTS. Any action required or permitted to
be taken at a meeting of the Management Committee or the Members may be taken
without a meeting, but upon the requisite notice as provided in paragraph (d)
above, if the requisite Representatives of each Member Group consent thereto in
writing, and if a complete and correct copy of such consent is promptly
delivered to all the Representatives of each Member Group following the
execution of any such consent.
32
<PAGE>
7.3 ACTIONS BY MANAGEMENT COMMITTEE.
(a) SCOPE OF AUTHORITY. The Management Committee shall have
full power and authority to direct and control the business and affairs of the
Company except as otherwise required by applicable law, and subject to the right
of the Management Committee to delegate such power and authority to Persons
responsible for day-to-day operation of the Company (it being understood that
authority to undertake Significant Matters prior to approval by the Management
Committee shall not be so delegated).
(b) ACTIONS REQUIRING MANAGEMENT COMMITTEE APPROVAL. Without
limiting the generality of the foregoing, the following actions shall require
approval of the Management Committee:
(i) approving any Significant Matter;
(ii) approving or taking any action for which the approval or
action of the Company is required under the Related Agreements, except
as the Management Committee may otherwise delegate in accordance with
paragraph (a) above; and
(iii) approving any other matter that the Management Committee
determines shall require its approval as such items may be set forth on
Schedule 7.3(b) from time to time.
(c) APPROVAL REQUIREMENTS.
(i) Except as otherwise specifically provided herein,
consent or approval of the Management Committee shall mean the
affirmative vote of a majority of the Representatives voting at a
duly held meeting of the Management Committee; provided, that with
respect to any Significant Matter, consent or approval of the
Management Committee shall mean the affirmative vote of all existing
Representatives; provided, however, that the Management Agreement may
be terminated, and the Manager removed and replaced, only in accordance
with the terms thereof.
(ii) Each Representative shall be entitled to one vote on all
matters submitted to a vote of the Management Committee; provided, that
if one or more Representatives are absent or not appointed because of a
vacancy on the Management Committee or otherwise, then any other
Representative of such absent Representative's Member Group present at
the meeting shall have the right to cast the votes of such absent
Representative(s).
(iii) The Company shall provide each Representative with (A)
adequate notice (in light of the time frame in which approval is
sought) of the substance of any matter requiring the approval of the
Management Committee in order to afford such Representative sufficient
time to review such matter and the Company's analysis thereof and (B)
an opportunity to consult with the management of the Company
33
<PAGE>
regarding such matter and possible alternatives prior to the meeting
at which approval is sought; provided, that any alleged noncompliance
with the provisions of this paragraph (iii) shall not affect the
validity of any consent or approval pursuant to paragraphs (i) and
(ii) above.
(d) INITIAL BUDGET. The budget for the Company's first three
years of operations shall be approved by the Management Committee simultaneously
with the execution of this Agreement or promptly thereafter.
(e) ANNUAL BUDGETS. The Management Committee shall adopt an
annual budget for the operations of the Company, which budget shall be in at
least as much detail and cover the same matters as the initial budget. The
proposed budget shall be presented to the Management Committee no later than 60
days prior to the commencement of the fiscal year of the Company to which it
pertains. Any annual budget adopted by the Management Committee that covers any
period covered by the initial three-year budget shall replace the initial
three-year budget with respect to such period.
ARTICLE 8
OPERATING AGREEMENTS AND OTHER COVENANTS
8.1 LIMITED EXCLUSIVITY.
(a) Except as provided in connection with a Disqualifying
Transaction, so long as the Company continues to meet the TDMA Quality Standards
in all material respects in all of its markets, AT&T will not, and will not
cause its Affiliates to, construct, own or acquire a controlling interest in, or
manage a communications system which provides Mobile Wireless Services in the
Territory, in each case within five years after the Effective Date, except that
AT&T and its Affiliates may:
(i) resell, or act as the Company's agent for, Company
Communications Services provided by the Company in accordance with a
Resale Agreement (or any other agreement between AWS Sub and its
Affiliates, on the one hand, and the Company, on the other hand), and
provide Company Communications Services to its own customers under the
Operating Agreement (including AWS Sub and its Affiliates providing
local numbers in the Territory or otherwise providing numbers and
service to residents of the Territory), including bundling any such
Company Communications Services with other Telecommunications Services
marketed, offered and provided or resold by AWS Sub or any of its
Affiliates;
(ii) provide or resell wireless Telecommunications Services
to or from specific locations (such as buildings or office
complexes), even if the subscriber equipment used in connection with
such service may be capable of routine movement within a limited
area (such as a building or office complex), and even if such
subscriber equipment may be capable of obtaining other
Telecommunications
34
<PAGE>
Services beyond such limited area (which other services may include
routine movement beyond such limited area) and hand-off between the
service to such specific locations and such other Telecommunications
Services; provided, however, that if AT&T or any of its Affiliates
sells such Mobile Wireless Services subscriber equipment as part of
such offering such equipment shall be capable of use in obtaining
(but not necessarily on an exclusive basis) Company Communications
Services;
(iii) continue to act as an agent for other Mobile Wireless
Services carriers in the Territory solely for existing national account
customers who are served by that carrier and request that they continue
to receive service from that carrier;
(iv) acquire a controlling interest in Tritel, Inc. or its
successors or assigns; provided, that at the time of such acquisition
Tritel, Inc. (or its successors or assigns) do not hold Licenses issued
by the FCC covering service areas within the Territory other than
Licenses in the service areas covered by the Licenses held by Tritel,
Inc. on the Effective Date that are listed on Schedule 8.1(a)(iv); and
provided, further, that AT&T and its Affiliates will continue to be
obligated to comply with their obligations under Section 8.2; and
(v) take such action as may be necessary or advisable to
comply only to the extent required with the construction requirements
of 47 CFR 24.203 in respect of the PCS licenses listed on Schedule
8.1(a)(v), and the Company shall cooperate with AT&T and its
Affiliates, at their request and expense, in connection therewith.
(b) To the extent the "other Telecommunications Services"
referred to in Section 8.1(a)(ii) are classified as Mobile Wireless Services,
neither AT&T nor any of its Affiliates or any AT&T licensee may provide or
resell, or act as agent for any Person offering, such Mobile Wireless Services
except Mobile Wireless Services provided by the Company in accordance with the
terms of Section 8.1(a)(i) or pursuant to roaming arrangements which comply with
Section 8.2. Nothing herein shall be construed to limit in any respect any
advertising and promotional and similar activities by AT&T or its Affiliates.
(c) The agreements set forth in this Section 8.1 will
terminate five years after the Effective Date, unless the parties agree to
extend such arrangements on mutually acceptable terms.
8.2 ROAMING PREFERENCE.
(a) For five years following the Effective Date, with
respect to the markets operated in the Territory, each of the Company and
(except as provided in connection with a Disqualifying Transaction) AT&T
shall, and shall cause each of its Affiliates to, in its and such Affiliates'
capacity as Home Carrier: (i) program and direct its authorized dealers to
program the subscriber equipment provided by it or such authorized dealers to
its customers, at the time it is provided to such customers (to the extent
such programming is
35
<PAGE>
technologically feasible) so that the Company or AT&T, as the case may be, and
such Affiliates, in its and such Affiliates' capacity as Serving Carrier, is the
preferred provider of roaming service in such markets, and (ii) refrain, and
direct its authorized dealers to refrain, from inducing any of its customers to
change or, except at such customer's request in the event the quality of the
Company's services do not meet the TDMA Quality Standards, from changing the
programming described in clause (i) above.
(b) For five years following the Effective Date, with
respect to the markets operated in the Territory, each of the Company and DCC
shall, and shall cause each of its Affiliates (other than Logix
Communications) to, in its and such Affiliates' capacity as Home Carrier: (i)
program and direct its authorized dealers to program the subscriber equipment
provided by it or such authorized dealers to its customers, at the time it is
provided to such customers (to the extent such programming is technologically
feasible) so that the Company or DCC, as the case may be, and such
Affiliates, in its and such Affiliates' capacity as Serving Carrier, is the
preferred provider of roaming service in such markets, and (ii) refrain, and
direct its authorized dealers to refrain, from inducing any of its customers
to change or, except at such customer's request in the event the quality of
the Company's services do not meet the TDMA Quality Standards, from changing
the programming described in clause (i) above.
(c) As used in this Section 8.2, the terms "Affiliate,"
"Home Carrier" and "Serving Carrier" shall have the meanings ascribed thereto
in the Operating Agreement.
(d) The agreements set forth in this Section 8.2 will
terminate five years after the Effective Date, unless the parties agree to
extend such arrangements on mutually acceptable terms.
8.3 RESALE AND AGENCY AGREEMENTS.
(a) From time to time, upon the request of AWS Sub, the
Company shall enter into a Resale Agreement relating to the Territory with AWS
Sub and any of its Affiliates and, with respect to any geographic area within
the Territory, one other Person designated by AWS Sub, provided such other
Person is licensed to provide Telecommunications Services in such geographic
area under the service marks used by AWS and qualifies as a reseller under any
generally applicable standards the Company establishes for its resellers from
time to time, and upon the request of AWS, the Company shall enter into an
agency agreement authorizing AWS Sub and any of its Affiliates and, with respect
to any geographic area within the Territory, one other Person designated by AWS
Sub, provided such other Person is licensed to provide Telecommunications
Services in such geographic area under the service marks used by AWS and
qualifies as an agent under any generally applicable standards the Company
establishes for its agents from time to time. Any such agency agreements shall
provide that the Company shall pay the agent a commission at the rate then
generally offered to the Company's agents and shall otherwise be on commercially
reasonable terms. At no time shall there be more than one Person (other than
36
<PAGE>
AWS Sub and its Affiliates) designated by AT&T as a reseller or an agent with
respect to any geographic area within the Territory.
(b) It is the intention of the parties that, in light of AWS
Sub's equity interest in the Company and the other arrangements between AWS Sub
and its Affiliates and the Company (including the roaming revenues anticipated
to be earned by the Company from subscribers of AWS Sub and its Affiliates), the
rates, terms and conditions of Service (as defined in the Resale Agreement)
provided by the Company pursuant to the Resale Agreement or any other agreement
between AWS Sub or such other reseller and the Company shall be at least as
favorable to AWS Sub or such other reseller, taken as a whole, as the rates,
terms and conditions of Service, taken as a whole, provided by the Company to
any other Customer (as defined in the Resale Agreement) and, to the extent
permitted by applicable law, such rates, terms and conditions shall be superior
to those provided to any other Customer. Without limiting the foregoing, the
rate plans offered by the Company pursuant to any Resale Agreement shall be
designed to result in the average actual rate per minute paid by the Reseller
(as defined in the Resale Agreement) for Service being at least 25% below the
weighted average actual rate per minute billed by the Company to its retail
subscribers for access and air time, but excluding revenues for features, taxes,
toll or other non-rate items. The Company and Reseller shall negotiate
commercially reasonable reductions to such resale rate based upon increased
volume commitments (including roaming charges incurred by subscribers of AT&T
and its Affiliates).
8.4 LONG DISTANCE SERVICE. To the extent permitted by law,
AT&T will be the Company's preferred provider of long distance service for so
long as the roaming arrangement described in Section 8.2(a) remains in effect.
The Company will purchase all of its long distance service, both for its own
needs and for resale to its customers, from AT&T, and AT&T will provide the
Company with long distance service at the best rates for which the Company
qualifies consistent with AT&T's practice with similarly situated customers,
provided, that at the time a long distance agreement is entered into, the rates
are commercially reasonable and reasonably competitive. Long distance service
may be purchased for the Company from AT&T by Logix Communications as long as
such service is made available to the Company at rates no higher than the rates
offered to the Company by AT&T directly.
8.5 EQUIPMENT DISCOUNTS. If reasonably requested by the
Company, AWS will, and will cause its 100% Subsidiaries to, use commercially
reasonable efforts to assist representatives of the Company in obtaining
discounts from any AWS vendor with whom the Company is negotiating for the
purchase of subscriber or infrastructure equipment. AWS shall not be required to
take any such action that AWS determines in its sole discretion is adverse to
its interests.
8.6 ROAMING AGREEMENTS. AWS will, and will cause its 100%
Subsidiaries to, use all commercially reasonable efforts to enable the Company
to become a party to the roaming agreements between AWS and its Affiliates and
operators of other wireless systems or, subject to the Company agreeing to the
obligations thereunder, entitled
37
<PAGE>
to the rights and benefits of AWS under such roaming agreements. AWS shall
not be required to take any such action that AWS determines in its sole
discretion is adverse to its interests.
8.7 CERTAIN RESTRICTIONS. DCC and its Affiliates will not
offer Telecommunications Services in the Territory except that a special purpose
Subsidiary of DCC with separate management, facilities and financing from DCC
and the Company may construct, own or acquire a controlling interest in, or
manage a communications system which provides Telecommunications Services that
are not Company Communications Services.
8.8 OTHER BUSINESS; DUTIES; ETC.
(a) Except as otherwise expressly set forth in this
Agreement, the Members and any Person affiliated with any of the Members may
engage in or possess an interest in other business ventures in which the
Company is not a party, and may engage in any other activities, of every kind
and description (whether or not competitive with the business of the Company
or otherwise affecting the Company), independently or with others in which
the Company is not a party, and shall owe no duty or liability to the
Company, its Members or their Affiliates in connection therewith except as
expressly set forth in this Agreement.
(b) To the extent that, at law or in equity, any Member
or any Affiliate of a Member, or any director, officer, stockholder,
employee, agent or representative of a Member or such Affiliate, would have
duties (including fiduciary duties) and liabilities to the Company or the
Members arising out of this Agreement that are different from or in addition
to those expressly provided in this Agreement, all rights of the other
Members arising out of such duties and liabilities are hereby waived and no
such Person shall be liable to the Company or to any Member for its good
faith reliance on the provisions of this Agreement.
(c) Notwithstanding any provision to the contrary in this
Agreement, to the fullest extent permitted by law, each Representative shall be
deemed the agent of the Member Group which appointed such Person a
Representative, and such Representative shall not be deemed an agent or a
sub-agent of the Company or the other Members or Member Groups and shall have no
duty (fiduciary or otherwise) to the Company or the other Members or Member
Groups.
8.9 CONFIDENTIALITY.
(a) Each Member shall, and shall cause each of its
Affiliates, and each of its and their respective partners, members, managers,
shareholders, directors, officers, employees and agents (collectively,
"Agents") to keep secret and retain in strictest confidence and not use for
any purpose except as contemplated by this Agreement any and all Confidential
Information relating to the Company or any Member and shall not disclose such
information, and shall cause its Agents not to disclose such information, to
anyone
38
<PAGE>
except (x) such Member's Affiliates or Agents who have a need to know such
information in connection with the matters contemplated by this Agreement and
(y) other Persons (such as lenders to the Company or a Member) who have a
bona fide business reason for obtaining such information in connection with
their dealings with the Company or such Member and who agree in writing to
keep in confidence all Confidential Information in accordance with the terms
of this Section. The obligations under this Section shall survive the
termination of this Agreement for a period of three years (or, if earlier, as
to any Person, three years following the date such Person ceases to be a
Member). The foregoing provisions of this Section were negotiated in good
faith by the parties hereto and the parties hereto agree that such provisions
are reasonable and are not more restrictive than is necessary to protect the
legitimate interests of the Members and the Company.
(b) The obligations set forth in paragraph (a) above
shall be inoperative with respect to Confidential Information that (i) is or
becomes generally available to the public other than as a result of
disclosure by the receiving party or its Agents, (ii) was available to the
receiving party on a non-confidential basis prior to its disclosure to the
receiving party or (iii) becomes available to the receiving party or its
agents, provided that such source is not known by the receiving party to be
bound by a confidentiality agreement with the providing party or its Agents.
(c) To the fullest extent permitted by law, if a Member
or any of its Affiliates or Agents breaches or threatens to commit a breach
of this Section, the other Members and the Company shall have the right to
have this Section specifically enforced by any court having jurisdiction, it
being acknowledged and agreed that money damages will not provide an adequate
remedy to such other Members or the Company. Nothing in this Section shall be
construed to limit the right of any Member or the Company to collect money
damages in the event of a breach of this Section; nor to limit the right of
any Member to report the financial condition and results of operations of the
Company to its shareholders, bondholders or to regulatory authorities to the
extent required by law, regulation or the terms of existing instruments.
(d) Anything else in this Agreement or the Related
Agreements notwithstanding, each Member shall have the right to disclose any
information, including Confidential Information of the other Member or such
other Member's Affiliates, in any filing with any regulatory agency, court or
other governmental authority to the extent that the disclosing Member
determines in good faith that it is required by law or regulation, provided
that any such disclosure shall be as limited in scope as possible and shall
only be made after giving the other Member as much notice as practicable of
such required disclosure and an opportunity to contest such disclosure if
possible.
8.10 CONVERSION TO CORPORATION.
(a) CONVERSION. The Company will be converted to a
corporation (the "Corporation") in connection with an IPO if the Management
Committee so determines or
39
<PAGE>
(notwithstanding Section 7.3) if a Qualified Member Group so elects under
Section 9.10. The Members will cooperate to minimize any adverse tax
consequences of such conversion.
(b) CONVERSION OF INTERESTS. Upon a conversion of the
Company to a corporation, the Interests of the Qualified Members will be
converted into Class B Common Shares of the Corporation entitling the holders
thereof to ten votes per share. The Interests of other Members will be
converted into Class A Common Shares of the Corporation entitling the holders
thereof to one vote per share. The certificate of incorporation of the
Corporation will provide that (i) Class B Common Shares that are Transferred
to, or held by, Persons that are not Qualified Members will convert
automatically into Class A Common Shares, (ii) Class B Common Shares will be
convertible at any time at the option of the holder into Class A Common
Shares and (iii) if permitted by the exchange on which shares of the
Corporation are listed for trading, Class A Common Shares held by a Qualified
Member will be convertible at any time at the option of the holder into Class
B Common Shares.
(c) STOCKHOLDERS AGREEMENT. Upon a conversion of the Company
to a corporation, the Members will enter into a stockholders agreement
containing, to the extent then applicable, substantially the same terms as this
Agreement, provided, that the stockholders agreement will provide for each
Qualified Member to have registration rights that are substantially similar to
the registration rights set forth in Article 4 to the Stockholder and Investor
Rights Agreement, dated as of January 31, 2000, among DCC and the Persons listed
on Schedule I thereto.
8.11 DISPUTE RESOLUTION.
(a) If a dispute arises out of or relating to this Agreement
or the Related Agreements, or the transactions contemplated hereby or thereby,
or the construction, interpretation, performance, breach, termination,
enforceability or validity thereof, whether such claim is based on rights,
privileges or interests recognized by or based upon contract, tort, fraud,
misrepresentation, statute, common law or any other legal or equitable theory,
and whether such claim existed prior to or arises on or after the date hereof (a
"Dispute"), the dispute resolution processes set forth in this Section 8.11
shall govern the resolution of such dispute.
(b) If a Dispute cannot be resolved by the executives having
primary managerial responsibility for the matter to which the Dispute pertains,
the parties shall attempt in good faith to resolve such Dispute promptly by
negotiation between executives who have authority to settle the Dispute and who
are at the level of the executives who have negotiated this Agreement ("Senior
Party Representatives").
(c) A party may provide any other party notice (a "Dispute
Notice") of any Dispute that has not been resolved in the normal course of
business. Within ten business days after delivery of the Dispute Notice, the
receiving party shall submit to each other party a response (the "Response").
The Dispute Notice and the Response shall each include (a) a statement setting
forth the position of the party providing such notice and a summary of
40
<PAGE>
arguments supporting such position, and (b) the name and title of such
party's Senior Party Representative and any other Persons who will accompany
the Senior Party Representative at the meeting at which the parties will
attempt to settle the Dispute. Within 30 business days after delivery of the
Dispute Notice, the Senior Party Representatives of the parties shall meet at
a mutually acceptable time and place, and thereafter as often as they
reasonably deem necessary, to attempt to resolve the Dispute. All reasonable
requests for information made by one party to another will be honored.
(d) If the Dispute has not been resolved within 50 business
days after delivery of the Dispute Notice, or if the parties fail to meet within
30 business days after delivery of the Dispute Notice, any party may initiate
arbitration of the Dispute as provided below. If no party initiates arbitration
within 60 business days after delivery of the Dispute Notice, then the parties
shall automatically be released from any and all liability for the Dispute.
(e) All negotiations pursuant to this section shall be
treated as compromise and settlement negotiations. Nothing said or disclosed,
nor any document produced, in the course of such negotiations that is not
otherwise independently discoverable shall be offered or received as evidence
or used for impeachment or for any other purpose in any current or future
arbitration. The parties agree that all communications and negotiations
between the parties during the dispute resolution process, any settlements
agreed upon during the dispute resolution process and any information
regarding the other party obtained during the dispute resolution process
(that are not already public knowledge) are confidential and may be disclosed
only to employees and agents of the parties who shall have a "need to know"
the information and who shall have been made aware of the confidentiality
obligations set forth in this Section 8.11, unless the party is required by
law to disclose such information.
(f) If the Dispute is not resolved as provided in
paragraphs (b) through (d) above, then any party may initiate arbitration
proceedings by providing each other party notice of such initiation of
arbitration. The Dispute shall then be settled by arbitration in accordance
with the CPR Non-Administered Arbitration Rules in effect on the date hereof,
by a panel of three arbitrators. Each Party shall select one of the three
arbitrators and the two arbitrators so chosen shall select the third
arbitrator. The arbitrators shall be governed by the United States
Arbitration Act, 9 U.S.C. Sections 1-16, and judgment upon the award rendered
by the arbitrators may be entered by any court having jurisdiction thereof.
The place of arbitration shall be chosen by the three arbitrators. The
arbitrators shall be empowered to award only damages that are recoverable
under the provisions of Article 11, and each party hereby irrevocably waives
any right to recover any other damages with respect to any Dispute. The
arbitrators shall not order pre-hearing discovery of documents or the taking
of depositions, although the arbitrators may compel the attendance of
witnesses and the production of documents at the hearing to the extent
permitted by the CPR Non-Administered Arbitration Rules.
(g) If a party does not provide a Dispute Notice within
one year following the time the party first knows of the existence of the
acts or omissions that give rise to the
41
<PAGE>
Dispute, the party shall be forever estopped from asserting the Dispute
against any other party.
(h) The reasonable out-of-pocket costs (including reasonable
attorneys' fees and expenses) of the prevailing party and the fees of the
arbitrators in any arbitration proceeding pursuant to this Section 8.11 shall be
paid by the other party. The arbitrators shall determine which party is the
prevailing party for purposes of this paragraph, and shall include such
determination in their award. If the arbitrators determine that neither party is
the prevailing party for purposes of this paragraph, then each party shall bear
its own costs and expenses, including attorneys' fees and expenses, and the
parties shall share equally the fees of the arbitrators.
(i) Notwithstanding the foregoing, nothing in this Agreement
shall preclude the parties from seeking injunctive or other equitable relief
from a court with regard to any breach of this Agreement or the Related
Agreements.
8.12 DISQUALIFYING TRANSACTION. Upon a Disqualifying
Transaction, AWS may terminate, with respect to all or any portion of the
Territory, the obligations of AT&T and its Affiliates contained in Sections 8.1,
8.2, 8.5 and 8.6, in which event the Voting Interests then held by the AWS
Member Group shall, subject to FCC approval if necessary, immediately and
automatically cease to exist and, accordingly, the AWS Member Group shall no
longer be entitled (x) to exercise governance rights with respect to the Company
(including the right to appoint Representatives to the Management Committee)
except as required by applicable law or (y) to receive information concerning
the Company except for annual and quarterly financial statements pursuant to
Section 6.4. In such event, upon at least 90 days' written notice to AWS given
within 90 days after termination by AWS of the obligations contained in Sections
8.1 and 8.2, the Company will have the right to terminate the Operating
Agreement with respect to the same portion of the Territory.
ARTICLE 9
TRANSFER RESTRICTIONS; EXIT RIGHTS;
CHANGE OF CONTROL OF DCC
The provisions of Sections 9.1 through 9.4 shall apply to direct
Transfers of Interests by the Members and Indirect Transfers of Interests by
Persons (including Members) that beneficially own Equity Interests in the
Members.
9.1 GENERAL RESTRICTIONS ON TRANSFERS.
(a) PRIOR TO THE THIRD ANNIVERSARY OF THE EFFECTIVE DATE.
Prior to the third anniversary of the Effective Date, Members may not Transfer
Voting Interests or Economic Interests except to other Qualified Members or
members of their respective Affiliate Groups, nor shall Indirect Transfers of
Interests be permitted except in accordance with the provisions of Section 9.4.
42
<PAGE>
(b) AFTER THE THIRD ANNIVERSARY OF THE EFFECTIVE DATE. On
and after the third anniversary of the Effective Date, Indirect Transfers of
Interests shall not be permitted except in accordance with the provisions of
Section 9.4, and
(i) Members may not Transfer Voting Interests except to
other Qualified Members or members of their respective Affiliate
Groups. Any Transfer permitted by the preceding sentence shall not
be subject to the right of first refusal set forth in Section 9.2 or
the tag-along right set forth in Section 9.3.
(ii) Members of the AWS Member Group may Transfer in the
aggregate up to 20% of the Economic Interests acquired by AWS Sub on
the Effective Date to Persons that are not members of the AWS Affiliate
Group or the DCC Affiliate Group. Members of the DCC Member Group may
Transfer in the aggregate up to 20% of the Economic Interests acquired
by DCC Sub on the Effective Date to Persons that are not members of the
DCC Affiliate Group or the AWS Affiliate Group. Any Transfer permitted
by the two preceding sentences shall not be subject to the right of
first refusal set forth in Section 9.2, but shall be subject to the
tag-along right set forth in Section 9.3.
(iii) If members of the AWS Member Group Transfer in the
aggregate more than 20% of the Economic Interests acquired by AWS Sub
on the Effective Date to Persons that are not members of the AWS
Affiliate Group or the DCC Affiliate Group, or members of the DCC
Member Group Transfer in the aggregate more than 20% of the Economic
Interests acquired by DCC Sub on the Effective Date to Persons that are
not members of the DCC Affiliate Group or the AWS Affiliate Group, the
Voting Interests then held by the AWS Member Group or the DCC Member
Group, as the case may be, shall immediately and automatically cease to
exist and, accordingly, Members that are members of the AWS Member
Group or the DCC Member Group, as the case may be, shall no longer be
entitled (x) to exercise governance rights with respect to the Company
(including the right to appoint Representatives to the Management
Committee) except as required by applicable law or (y) to receive
information concerning the Company except for annual and quarterly
financial statements under Section 6.4. Any Transfer (or portion
thereof) by a Member of any Member Group, after giving effect to which
the 20% threshold described in the preceding sentence is crossed, and
any subsequent Transfer by a Member of such Member Group, shall be
subject to the right of first refusal set forth in Section 9.2 and the
tag-along right set forth in Section 9.3.
(iv) Members may not Transfer Voting Interests or Economic
Interests to a Prohibited Transferee except (after the IPO) pursuant to
broadly distributed underwritten registered public offerings and Rule
144 under the Securities Act.
(c) OTHER ENCUMBRANCES ON INTERESTS. Notwithstanding
anything to the contrary in this Agreement or the Act, a Member may not pledge,
hypothecate or otherwise encumber all or any portion of its Interests.
43
<PAGE>
9.2 RIGHT OF FIRST REFUSAL.
(a) NOTICE AND EXERCISE OF RIGHT. Subject to the limitations
of Section 9.1(a), if
(i) members of a Member Group (the "Sellers") receive and
wish to accept a written offer (the "Offer") from a bona fide third
party (the "Offeror") to purchase some or all of their Economic
Interests (the "Offered Interests"),
(ii) the consummation of such purchase would result (together
with any prior Transfers) in the Member Group to which the Sellers
belong ceasing to be a Qualified Member Group, or this Section 9.2
otherwise expressly applies pursuant to the terms of this Agreement,
and
(iii) the other Member Group is a Qualified Member Group (it
being understood that if the other Member Group is not then a Qualified
Member Group, the Sellers shall not be obligated to comply with the
provisions of this Section 9.2 or Section 9.3),
then the Sellers shall give notice of such Offer (the "Offer Notice") to the
members of the other Member Group (the "Buyers"), which notice shall identify
the Offeror, enclose a copy of the Offer, and irrevocably offer to the Buyers
the right to purchase (pro rata in accordance with their respective Interests
unless the Buyers otherwise agree) the Offered Interests on the same economic
terms and conditions as specified in the Offer (if they are the only assets
being sold and are being sold for cash) or for cash at their Fair Market Value
(if they are being Transferred in such transaction or series of related
transactions with other assets or for consideration other than cash), provided,
that the Buyers shall be entitled to pay for the Offered Interests with
instruments of indebtedness to the extent the Offer contemplates the delivery of
instruments of indebtedness. The Buyers may exercise their right to purchase the
Offered Interests by notifying the Sellers in writing of their election to
purchase within 21 days after the later of (x) delivery of the Offer Notice and
(y) any determination of Fair Market Value pursuant to Section 9.4(c) or
otherwise.
(b) CLOSING OF PURCHASE. If the Buyers duly elect to
purchase the Offered Interests, the closing of such purchase (the "RoFR
Closing") shall take place on a date agreed to by the Sellers and the Buyers,
but in no event later than 30 days following the exercise by the Buyers of
their election to purchase; provided, that if governmental or regulatory
approval is required for any Buyer to consummate its purchase and has not
been obtained, the RoFR Closing with respect to such purchase may be deferred
until such approval is obtained.
(c) REPRESENTATIONS AT CLOSING. At any RoFR Closing, the
Sellers shall represent and warrant in writing to the Buyers only that the
Sellers (i) are the sole beneficial and record owners of the Offered Interests
and have good and marketable title thereto free and clear of all Liens (other
than restrictions imposed pursuant to this Agreement) and (ii) have full power
and authority to sell the Offered Interests without conflict with the terms of
44
<PAGE>
any law, order or material agreement or instrument binding upon them or their
assets; and the Sellers shall deliver to the Buyers such customary instruments
of assignment with respect to the Offered Interests as may be reasonably
requested by the Buyers.
(d) SALE TO THIRD PARTY. If the Buyers fail to exercise
their right to purchase the Offered Interests, the Sellers may accept the
Offer and sell the Offered Interests to the Offeror; provided, that such sale
shall be at the same price and on the same terms and conditions as specified
in the Offer Notice and otherwise in accordance with Section 9.5. If such
sale is not consummated within 90 days after the expiration of the applicable
time periods specified in paragraph (b) above, such right to sell shall lapse
and Transfers of the Offered Interests shall again be subject to the
provisions of this Section 9.2.
(e) ASSUMPTION OF AGREEMENTS. At any closing with respect
to a sale to a third party, the Offeror shall execute a counterpart to this
Agreement and any Related Agreements to which the Sellers or their Affiliates
are party and shall be bound by the provisions of and assume the obligations
of the Sellers under all such Agreements, provided, that the Management
Agreement shall not be assigned or assumed except in accordance with its
terms. The Sellers and the Offeror shall execute such documents as the Buyers
may reasonably request to evidence such assumption.
(f) PUBLIC SALES. Sales of Interests after the IPO
pursuant to registered public offerings and Rule 144 under the Securities Act
shall be subject to this Section 9.2.
9.3 TAG-ALONG RIGHT.
(a) NOTICE AND EXERCISE OF RIGHT. In lieu of exercising its
rights under Section 9.2, or as otherwise expressly provided herein, the Buyers
may, within 21 days after receipt of any Offer Notice, elect by notice to the
Sellers to include their Economic Interests (the "Included Interests") in such
sale on a pro rata basis with the Sellers. Any such sale of Included Interests
shall be made on the same economic terms and conditions as specified in the
Offer (if they are the only assets being sold and are being sold for cash) or
for cash at their Fair Market Value (if they are being Transferred in such
transaction or series of related transactions with other assets or for
consideration other than cash), and the Sellers may not consummate their sale
unless the sale of Included Interests (if any) by the Buyers is consummated
simultaneously in accordance with the terms hereof. If the Buyers do not elect
to participate in such sale, and such sale is not consummated within the
applicable time periods specified in Section 9.2(d), the restrictions contained
in this Section 9.3 shall again become effective, and Economic Interests may not
be Transferred thereafter except in accordance with this Article 9.
(b) REPRESENTATIONS AT CLOSING. At the closing of any
Transfer of Included Interests pursuant to this Section 9.3, (i) the
participating Buyers shall not be required to make any representations and
warranties with respect to the Company or the Business other than those that
the Sellers make to the purchaser, nor shall the Buyers be required to make
any non-compete, non-solicit or similar covenants in connection with such
Transfer, and (ii)
45
<PAGE>
the participating Buyers shall deliver to the purchaser such customary
instruments of assignment with respect to the Included Interests as may be
reasonably requested by the purchaser.
(c) PUBLIC SALES. Sales of Interests after the IPO
pursuant to registered public offerings and Rule 144 under the Securities Act
shall not be subject to this Section 9.3.
9.4 INDIRECT TRANSFERS. Subject to Section 9.8, the
provisions of Sections 9.1, 9.2, 9.3, 9.5, 9.6 and 9.7 (the "Specified
Restrictions") shall apply to Indirect Transfers of Interests to the same
extent that they apply to direct Transfers of Interests except as otherwise
provided in this Section 9.4 or elsewhere in this Agreement.
(a) PERCENTAGE TRANSFERRED. A Transfer of any percentage of
the Equity Interests in a member of any Affiliate Group shall be deemed to be a
Transfer by the applicable Member Group of the same percentage of Economic
Interests in the Company. For example, the Transfer of 30% of the capital stock
of AWS Sub or DCC Sub shall be deemed to be the Transfer of 30% of the Economic
Interests in the Company by the AWS Member Group or the DCC Member Group,
respectively. Notwithstanding the foregoing, if at the time of any Indirect
Transfer involving a member of any Affiliate Group, the percentage of the Equity
Interests in such member being Transferred exceeds the percentage of Economic
Interests in the Company then held by the applicable Member Group, such Indirect
Transfer shall be deemed to be a Transfer by such Member Group of the percentage
of Economic Interests in the Company then held by such Member Group. For
example, the Transfer of 60% of the capital stock of AWS Sub or DCC Sub at a
time when they each hold 50% of the Economic Interests in the Company shall be
deemed to be a Transfer of 50% of the Economic Interests in the Company by the
AWS Member Group or the DCC Member Group, respectively.
(b) INDIRECT TRANSFERS WITHIN AN AFFILIATE GROUP. The
Specified Restrictions shall not apply to Transfers of Equity Interests in a
member of any Affiliate Group if immediately after giving effect to such
Transfer such Person remains a member of such Affiliate Group, unless such
Transfer has substantially the same economic effect as a Transfer of Interests
in the Company to a Person that is not a member of such Affiliate Group.
(c) INDIRECT TRANSFERS INVOLVING DCC. So long as the
Interests in the Company beneficially owned by DCC do not account for 50% or
more of the value of DCC, the Specified Restrictions shall not apply to
Transfers of Equity Interests in DCC or any Parent of DCC; provided, that
such Transfers are not designed to circumvent the transfer restrictions
contained herein; and provided, further, that the Specified Restrictions
shall apply, in accordance with Section 9.8, to any Transfer resulting in a
Change of Control of DCC. Notwithstanding Section 9.1(c), DCCLP may pledge
capital stock of DCC to secure indebtedness owing to Bank of America, N.A.
under instruments of indebtedness in effect on the Effective Date, as such
instruments may be amended or replaced from time to time.
46
<PAGE>
(d) INDIRECT TRANSFERS INVOLVING AT&T. The Specified
Restrictions shall not apply to (i) Transfers of Equity Interests in AWS, (ii)
Transfers of Equity Interests in AT&T or (iii) Transfers of Equity Interests by
any direct or indirect shareholder of AWS or AT&T; provided, that such Transfers
are not designed to circumvent the transfer restrictions contained herein.
(e) INDIRECT TRANSFERS INVOLVING JWC. Notwithstanding
anything in this Agreement to the contrary, the Specified Restrictions shall
not apply to Transfers of Equity Interests in DCC by J.W. Childs Equity
Partners, II, L.P. (and its affiliated funds and co-investors listed on
Schedule 9.4).
9.5 SUBSTITUTED MEMBERS. Prior to any Transfer of
Interests by a member of any Member Group, the transferor shall deliver to
the members of the other Member Group a notice setting forth the identity of
the transferee and (if applicable) stating that such transferee is a member
of the transferor's Affiliate Group, and shall provide such other information
as the members of the other Member Group may reasonably request in connection
with such Transfer. The transferee shall be admitted as a Member upon
execution of a counterpart to this Agreement evidencing its agreement to be
bound hereby. Upon the admission of any such transferee as a Member, the
transferring Member or Members shall be relieved of any obligation arising
under this Agreement subsequent to such Transfer with respect to the
Interests being transferred (provided that the transferee shall assume all
such obligations), and if the transferring Member no longer holds any
Interests, the transferring Member shall be relieved of its obligations
arising under this Agreement to the extent provided in Section 12.12.
9.6 INVALID TRANSFERS VOID. Any purported Transfer of an
Interest or any part thereof not in compliance with the provisions of this
Article 9 shall be void and of no force or effect and the transferring Member
shall be liable to the other Members and the Company for all liabilities,
obligations, damages, losses, costs and expenses (including but not limited to
reasonable attorneys' fees and court costs) arising out of such noncomplying
Transfer.
9.7 DETERMINATION OF FAIR MARKET VALUE. The Fair Market
Value of Interests to be transferred or other property received pursuant to
this Agreement shall be determined in the following manner:
For purposes of this Section 9.7, Sellers owning a majority of
the applicable Offered Interests shall have the right to act on behalf
of the Sellers. Within 15 days after the delivery of the notice
requiring such determination, the Sellers and the Buyers shall attempt
in good faith to agree on the Fair Market Value. If the Sellers and the
Buyers fail within 15 days thereafter to agree thereon, each of the
Sellers and the Buyers shall deliver a notice to the other appointing
as its appraiser ("Appraiser") an independent accounting or investment
banking firm of nationally recognized standing. The Sellers and Buyers
by mutual agreement shall also appoint a third Appraiser. If after
appointment of the two Appraisers, the Sellers and Buyers are
47
<PAGE>
unable to agree upon a third Appraiser, such appointment shall be
made within fifteen days of the request by the American Arbitration
Association, or any organization successor thereto, from a panel of
arbitrators having experience in the appraisal of the type of
property then the subject of appraisal. The decisions of the three
Appraisers so appointed and chosen shall be given within 30 days
after the selection of such third Appraiser. If the determination of
one Appraiser differs from the middle determination by more than
twice the amount by which the other determination differs from the
middle determination, then the determination of such Appraiser shall
be excluded, the remaining two determinations shall be averaged and
such average shall be binding and conclusive on the parties;
otherwise the average of all three determinations shall be binding
and conclusive. The Sellers' obligation to provide an Offer Notice
pursuant to Section 9.2(a) shall not be applicable until the date of
delivery of such determination to the Buyers. The costs of
conducting any Appraisal Procedure shall be borne as follows: (x)
the costs of the Appraiser designated by the Sellers and other costs
separately incurred by the Sellers shall be borne by the Sellers;
(y) the costs of the Appraiser designated by the Buyers and other
costs separately incurred by the Buyers shall be borne by the
Buyers; and (z) the costs of the third Appraiser, if any, shall be
shared equally by the Sellers and the Buyers.
9.8 CHANGE OF CONTROL OF DCC. Notwithstanding anything in
this Agreement to the contrary:
(a) PROHIBITED TRANSFEREE, ETC. If there is a Change of
Control of DCC in which a Prohibited Transferee (alone or as part of a "group"
as such term is used in Sections 13(d) and 14(d) of the Exchange Act and the
regulations thereunder) or, prior to the second anniversary of the Effective
Date, a Person that is not a Prohibited Transferee (alone or as part of a
"group" as such term is used in Sections 13(d) and 14(d) of the Exchange Act and
the regulations thereunder) acquires control of DCC, and either the Company is a
limited liability company and the AWS Member Group is a Qualified Member Group,
or the Company has converted to a corporation and members of the AWS Affiliate
Group retain in the aggregate capital stock in such corporation representing at
least 50% of the Economic Interests that AWS Sub acquired on the Effective Date,
then
(i) If it does not elect to exercise its rights under
Section 9.2 or 9.3, the AWS Member Group may initiate the Buy-Sell
Procedure (except that the AWS Member Group shall have the right but
not the obligation to require that DCC propose the cash purchase
price for all of the Interests of the AWS Member Group) for 90 days
after the second anniversary of the Effective Date,
(ii) from and after the effective date of such Change of
Control of DCC, the DCC Member Group shall lose the right to appoint
one of its two Representatives to the Management Committee (and such
Representative shall forthwith resign or be deemed removed as such) and
the AWS Member Group shall thereupon have the right to appoint three of
the four Representatives, and
48
<PAGE>
(iii) from and after the effective date of such Change of
Control of DCC, subject to Section 9.1(b)(iii), the Significant Matters
that the DCC Member Group will have the right to approve shall be those
set forth on Exhibit A.
(b) STATUS OF CONTROL PERSON. Except as otherwise provided
in this Section 9.8, any Person referred to in paragraph (a) above that acquires
control of DCC shall be treated as the Dobson Group for all purposes of this
Agreement, and if the DCC Member Group was a Qualified Member Group immediately
prior to the time of the Change of Control of DCC, and for so long thereafter as
it qualifies as such hereunder, it shall also be considered a Qualified Member
Group immediately after the Change of Control.
9.9 BUY-SELL PROCEDURE.
(a) AFTER THE FIFTH ANNIVERSARY OF THE EFFECTIVE DATE. After
the fifth anniversary of the Effective Date, whether or not an IPO has occurred,
a Member Group may initiate a buy-sell procedure (the "Buy-Sell Procedure") by
giving the other Member Group a notice referring to this Section 9.9(a) (the
"Section 9.9(a) Notice"), which notice shall specify a cash purchase price per
Interest or per share, as applicable, for all of the Interests in the Company
then held by the other Member Group, and contain an irrevocable offer to
purchase such Interests, and to sell all of the Interests in the Company then
held by the initiating Member Group, at such price. The non-initiating Member
Group may exercise its right to purchase or sell by notifying the initiating
Member Group of its election within 90 days after delivery of the Section 9.9(a)
Notice; provided, that the DCC Member Group may not initiate the Buy-Sell
Procedure, or elect to buy in the event that the AWS Member Group initiates the
Buy-Sell Procedure, without concurrently providing to the AWS Member Group a
firm commitment, including a "material adverse change" condition (which may
include a condition relating to disruption of the financial markets), reasonably
acceptable to the AWS Member Group, from a financial institution reasonably
acceptable to the AWS Member Group, to underwrite the purchase price. The
closing of any such purchase and sale will occur within 90 days after the end of
such 90-day period, subject to extension for obtaining by Final Order any
regulatory approvals.
(b) IN CONNECTION WITH OVERLAP IN SERVICE COVERAGE. The AWS
Member Group may initiate the Buy-Sell Procedure at any time if (x) the Company
is then offering, in service areas covering 15% or more of the Company's Pops,
Company Communications Services that are not Mobile Wireless Services and (y)
AWS or its Affiliates are then offering, or have a good faith intention to begin
offering and have taken material steps towards offering, in such service areas,
Telecommunications Services that could reasonably be considered by subscribers
to be equivalent to, or a substitute for, such Company Communications Services
that are not Mobile Wireless Services. Such right will be exercisable by giving
the DCC Member Group a notice referring to this Section 9.9(b) (the "Section
9.9(b) Notice") and signed by a senior executive officer of AWS, which notice
shall (x) describe in reasonable detail the competing services that AWS or its
Affiliates are then offering or intending in good faith to offer and the steps
they have taken towards offering such services, (y) specify a cash purchase
price per Interest or per share, as applicable, for all
49
<PAGE>
of the Interests in the Company then held by the DCC Member Group, and (z)
contain an irrevocable offer to purchase such Interests, and to sell all of
the Interests in the Company then held by the AWS Member Group, at such
price. The DCC Member Group may exercise its right to purchase or sell by
notifying the AWS Member Group of its election within 90 days after delivery
of the Section 9.9(b) Notice; provided, that the DCC Member Group may not
elect to purchase without concurrently providing to the AWS Member Group a
firm commitment, including a "material adverse change" condition (which may
include a condition relating to disruption of the financial markets),
reasonably acceptable to the AWS Member Group, from a financial institution
reasonably acceptable to the AWS Member Group, to underwrite the purchase
price. The closing of any such purchase and sale will occur within 90 days
after the end of such 90-day period, subject to extension for regulatory
approvals.
(c) IN THE EVENT OF CHANGE OF CONTROL OF DCC. If, in
connection with a Change of Control of DCC, the AWS Member Group does not elect
to exercise its right to initiate the Buy-Sell Procedure pursuant to Section
9.8(a)(i), if applicable, or its right of first refusal or tag-along right under
Section 9.2 or 9.3, then, at any time during the 90-day period beginning on the
later of the second anniversary of the Effective Date and 90 days following the
expiration of the last of such rights, the DCC Member Group will have the right
to initiate the Buy-Sell Procedure by giving the AWS Member Group a notice
referring to this Section 9.9(c) (the "Section 9.9(c) Notice"), which notice
shall specify a cash purchase price per Interest or per share, as applicable,
for all of the Equity Interests in the Company then held by the AWS Member
Group, and contain an irrevocable offer to purchase such Equity Interests, and
to sell all of the Equity Interests in the Company then held by the DCC Member
Group, at such price; provided, that the DCC Member Group may not initiate the
Buy-Sell Procedure without concurrently providing to AWS Member Group a firm
commitment, including a "material adverse change" condition (which may include a
condition relating to disruption of the financial markets), reasonably
acceptable to the AWS Member Group, from a financial institution reasonably
acceptable to the AWS Member Group, to underwrite the purchase price. The AWS
Member Group may exercise its right to purchase or sell by notifying the DCC
Member Group of its election within 90 days after delivery of the Section 9.9(c)
Notice. The closing of any such purchase and sale will occur within 90 days
after the end of such 90-day period, subject to extension for regulatory
approvals.
(d) REPRESENTATIONS AT CLOSING. At the closing of any
purchase and sale pursuant to the Buy-Sell Procedure, the selling Member Group
shall represent and warrant in writing to the non-selling Member Group that the
selling Members (i) are the sole beneficial and record owners of the Interests
being sold and have good and marketable title thereto free and clear of all
Liens (other than restrictions imposed pursuant to this Agreement) and (ii) have
full power and authority to sell the Interests being sold without conflict with
the terms of any law, order or material agreement or instrument binding upon
them or their assets; and the selling Members shall deliver to the non-selling
Member Group such customary instruments of assignment with respect to the
Interests being sold as may be reasonably requested by the non-selling Member
Group.
50
<PAGE>
(e) TERMINATION OF AGREEMENT. Upon the consummation of a
purchase and sale transaction pursuant to the Buy-Sell Procedure, the Management
Agreement and the agreements set forth in Sections 8.1, 8.2, 8.5 and 8.6 will
terminate immediately, and the Operating Agreement will terminate on the later
of (a) the tenth anniversary of the Effective Date and (b) the second
anniversary of the consummation of such purchase and sale transaction.
9.10 IPO DEMAND. After the fifth anniversary of the Effective
Date, any Qualified Member Group may by notice to the Company and the other
Qualified Member Group (if any) elect (the "Section 9.10 Election") to require
the Company to convert to a corporation in accordance with Section 8.10 and to
effect an IPO of not less than 10% nor more than 20% of the Corporation's Class
A Common Stock, underwritten by an underwriter selected by the Management
Committee, and otherwise conducted in accordance with the registration
procedures referred to in Section 8.10(c); provided, that the non-electing
Qualified Member Group (if any) may (i) defer the Section 9.10 Election for up
to 180 days on one occasion during any 12-month period and (ii) preempt the
Section 9.10 Election by initiating the Buy-Sell Procedure within 30 days after
such Election is made, provided, that the DCC Member Group may not initiate the
Buy-Sell Procedure, or elect to buy in the event that the AWS Member Group
initiates the Buy-Sell Procedure, without concurrently providing to AWS Member
Group a firm commitment, including a "material adverse change" condition (which
may include a condition relating to disruption of the financial markets),
reasonably acceptable to AWS Member Group, from a financial institution
reasonably acceptable to AWS Member Group, to underwrite the purchase price.
ARTICLE 10
DISSOLUTION AND TERMINATION
10.1 NO WITHDRAWAL. Except as expressly provided in this
Agreement or as otherwise provided by law, no Member shall have the right, and
each Member hereby agrees not, to dissolve, terminate or liquidate the Company,
or to resign or withdraw as a Member.
10.2 DISSOLUTION. The Company shall be dissolved upon the
written determination of the Management Committee to dissolve the Company, but
only on the effective date of dissolution specified by the Management Committee
in such determination.
10.3 PROCEDURES UPON DISSOLUTION.
(a) GENERAL. In the event the Company dissolves it shall
commence winding up pursuant to the appropriate provisions of the Act and the
procedures set forth in this Section 10.3. Notwithstanding the dissolution of
the Company, until the winding up of the Company's affairs is completed, the
business of the Company and the affairs of the Members, as such, shall continue
to be governed by this Agreement.
(b) CONTROL OF WINDING UP. The winding up of the Company
shall be conducted under the direction of the Management Committee or such other
Person as may be
51
<PAGE>
designated by a court of competent jurisdiction (herein sometimes referred to
as the "Liquidator"); provided that any Member whose breach of this Agreement
shall have caused the dissolution of the Company (and the Representatives
appointed by such Member) shall not participate in the control of the winding
up of the Company; and provided further, that if the dissolution is caused by
entry of a decree of judicial dissolution, the winding up shall be carried
out in accordance with such decree.
(c) MANNER OF WINDING UP. The Company shall engage in no
further business following dissolution other than that necessary for the orderly
winding up of business and distribution of assets. The Company's maintenance of
offices shall not be deemed a continuation of business for purposes of this
Section 10.3. Upon dissolution of the Company, the Liquidator shall, subject to
paragraph (a) above, first attempt to distribute assets in kind if it can obtain
the consent of each of the Members and, to the extent necessary, the creditors
of the Company. If such consent is not obtained, the Liquidator shall sell the
Company or all the Company's property in such manner and on such terms as it
deems fit, consistent with its fiduciary responsibility and having due regard to
the activity and condition of the relevant market and general financial and
economic conditions. Each Member shall share Profits, Losses and other items
after the dissolution of the Company and during the period of winding up in the
same manner as described in Article 4.
(d) APPLICATION OF ASSETS. Upon dissolution of the Company,
the Company's assets (which shall, after the sale or sales referenced in
paragraph (c) above, consist of the proceeds thereof) shall be applied as
follows:
(i) CREDITORS. To creditors, including Members and
Representatives who are creditors, to the extent otherwise permitted by
law, in satisfaction of liabilities of the Company (whether by payment
or the reasonable provision for the payment thereof). Any reserves set
up by the Liquidator may be paid over by the Liquidator to an escrow
agent or trustee, to be held in escrow or trust for the purpose of
paying any such contingent or unforeseen liabilities or obligations,
and, at the expiration of such period as the Liquidator may deem
advisable, such reserves shall be distributed to the Members or their
assigns in the manner set forth in paragraph (ii) below.
(ii) MEMBERS. By the end of the taxable year in which the
liquidation occurs (or, if later, within 90 days after the date of such
liquidation), to the Members in proportion to the positive 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
paragraph).
10.4 TERMINATION. Upon completion of the winding up of the
Company and the distribution of all Company assets, the Company's affairs shall
terminate and the Members shall cause to be executed and filed any and all
documents required by the Act to effect the termination of the Company.
52
<PAGE>
ARTICLE 11
EXCULPATION AND INDEMNIFICATION
11.1 NO PERSONAL LIABILITY.
(a) Except as otherwise provided by the Act, the debts,
obligations and liabilities of the Company, whether arising in contract, tort or
otherwise, shall be solely the debts, obligations and liabilities of the
Company, and no Indemnified Person (as defined in paragraph (b) below) shall be
obligated personally for any such debt, obligation or liability of the Company
solely by reason of being an Indemnified Person.
(b) No Representative, Member or its Affiliates, or any of
their respective shareholders, directors, officers, employees, agents, members,
managers, or partners (each, an "Indemnified Person") shall be liable,
responsible or accountable in damages or otherwise to the Company or to any
other Indemnified Person for any act or omission performed or omitted by an
Indemnified Person in connection with the transactions contemplated hereby,
whether for mistake of judgment or negligence or other action or inaction,
unless such action or omission constitutes willful misconduct, gross negligence
or bad faith. Each Indemnified Person may consult with counsel, accountants and
other experts in respect of the affairs of the Company and such Indemnified
Person shall be fully protected and justified in any action or inaction which is
taken in good faith in accordance with the advice or opinion of such counsel,
accountants or other experts, provided that they shall have been selected with
reasonable care.
11.2 INDEMNIFICATION BY COMPANY. To the maximum extent
permitted by applicable law, the Company shall protect, indemnify, defend and
hold harmless each Indemnified Person for any acts or omissions performed or
omitted by an Indemnified Person (in its capacity as such) unless such action or
omission constituted willful misconduct, gross negligence or bad faith. The
indemnification authorized under this Section shall include payment on demand
(with appropriate evidence of the amounts claimed) of reasonable attorneys' fees
and other expenses incurred in connection with, or in settlement of, any legal
proceedings between the Indemnified Person and a third party and the removal of
any Liens affecting any property of the Indemnified Person. Such indemnification
rights shall be in addition to any and all rights, remedies and recourse to
which any Indemnified Person shall be entitled, whether or not pursuant to the
provisions of this Agreement, at law or in equity. The indemnities provided for
in this Section 11.2 shall be recoverable only from the assets of the Company,
and there shall be no recourse to any Member or other Person for the payment of
such indemnities.
11.3 NOTICE AND DEFENSE OF CLAIMS.
(a) NOTICE OF CLAIM. If any action, claim or proceeding
("Claim") shall be brought or asserted against any Indemnified Person in respect
of which indemnity may be sought from the Company under Section 11.2, the
Indemnified Person shall give prompt written notice of such Claim to the
Company, which may assume the defense thereof,
53
<PAGE>
including the employment of counsel reasonably satisfactory to the
Indemnified Person and the payment of all of such counsel's fees and
expenses; provided that any delay or failure to so notify the Company shall
relieve the Company of its obligations hereunder only to the extent, if at
all, that it is prejudiced by reason of such delay or failure. Any such
notice shall refer to Section 11.2 and describe in reasonable detail the
facts and circumstances of the Claim being asserted.
(b) DEFENSE BY THE COMPANY. In the event that the Company
undertakes the defense of the Claim, the Company will keep the Indemnified
Person advised as to all material developments in connection with any Claim,
including, but not limited to, promptly furnishing the Indemnified Person with
copies of all material documents filed or served in connection therewith. The
Indemnified Person shall have the right to employ one separate firm per
jurisdiction with respect to any of the foregoing Claims and to participate in
the defense thereof, but the fees and expenses of such firm shall be at the
expense of the Indemnified Person unless both the Indemnified Person and the
Company are named as parties and representation by the same counsel is
inappropriate due to actual differing interests between them; provided that
under no circumstances shall the Company be liable for the fees and expenses of
more than one law firm per jurisdiction in any of the foregoing Claims for the
Indemnified Persons, taken collectively and not separately. The Company may,
without the Indemnified Person's consent, settle or compromise any Claim or
consent to the entry of any judgment if such settlement, compromise or judgment
involves only the payment of money damages by the Company (which payment is made
or adequately provided for at the time of such settlement, compromise or
judgment) or provides for the unconditional release by the claimant or plaintiff
of the Indemnified Person and its Affiliates from all liability in respect of
such Claim and does not impose injunctive relief against any of them. The
Indemnified Person shall provide reasonable assistance to the Company in the
defense of the Claim. As between the Company, on the one hand, and the
Indemnified Persons, on the other hand, any matter that is not agreed to
unanimously by the Indemnified Persons shall be determined by the Indemnified
Person that is a party to this Agreement.
(c) DEFENSE BY THE INDEMNIFIED PERSON. In the event that the
Company, within 20 business days after receiving written notice of any such
Claim, fails to assume the defense thereof, the Indemnified Person shall have
the right, subject to the right of the Company thereafter to assume such defense
pursuant to the provisions of this Article 11, to undertake the defense,
compromise or settlement of such Claim for the account of the Company.
(d) ADVANCEMENT OF EXPENSES. Unless the Indemnifying Party
shall have assumed the defense of any Claim pursuant to paragraph (b) above, the
Company shall advance to the Indemnified Person any of its reasonable attorneys'
fees and other costs and expenses incurred in connection with the defense of any
such Claim. Each Indemnified Person shall agree in writing prior to any such
advancement, that in the event he or it receives any such advance, such
Indemnified Person shall reimburse the Company for such fees, costs, and
expenses to the extent that it shall be determined that he or it was not
entitled to indemnification under this Article 11.
54
<PAGE>
(e) CONTRIBUTION. Notwithstanding any of the foregoing to
the contrary, the provisions of this Article 11 shall not be construed so as to
provide for the indemnification of any Indemnified Person for any liability to
the extent (but only to the extent) that such indemnification would be in
violation of applicable law or to the extent such liability may not be waived,
modified, or limited under applicable law, but shall be construed so as to
effectuate the provisions of this Article 11 to the fullest extent permitted by
law; provided, that if and to the extent that the Company's indemnification
obligation under this Article 11 is unenforceable for any reason, the Company
hereby agrees to make the maximum contribution permissible under applicable law
to the payment and satisfaction of the losses of the Indemnified Person, except
to the extent such losses are found in a final, nonappealable judgment by a
court of competent jurisdiction to have resulted from the Indemnified Person's
gross negligence or willful misconduct.
ARTICLE 12
MISCELLANEOUS
12.1 ENTIRE AGREEMENT. This Agreement and the Related
Agreements, together with any schedules and exhibits hereto and thereto, contain
the entire agreement and understanding of the Members relating to the subject
matter hereof and supersede all prior negotiations, proposals, offers,
agreements and understandings (written or oral) relating to such subject matter,
including the letter agreement and term sheet attached thereto dated October 5,
1999 among AWS, DCC and DCCLP.
12.2 AMENDMENT; WAIVER. Neither this Agreement nor any
provision hereof may be amended or modified except in a writing signed by each
of the Qualified Members; PROVIDED, that any amendment or modification that
adversely affects a non-Qualified Member shall require the consent of such
Member. No failure or delay of any Member in exercising any power or right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce any such right or power, preclude any other further exercise
thereof or the exercise of any other right or power. No waiver by any Member of
any departure by any other Member from any provision of this Agreement shall be
effective unless the same shall be in a writing signed by the Member against
which enforcement of such waiver or consent is sought, and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which it was given. No notice or similar communication by any Member
to another shall entitle such other Member to any other or further notice or
similar communication in similar or other circumstances, except as specifically
provided herein.
12.3 SPECIFIC PERFORMANCE. The Members acknowledge that
money damages may not be an adequate remedy for violations of this Agreement
and that any Member may, in its sole discretion, in an arbitration or a court
of competent jurisdiction, to the extent permitted hereunder, apply for
specific performance or injunctive or other relief as such arbitration or
court may deem just and proper in order to enforce this Agreement or to
55
<PAGE>
prevent violation hereof and, to the extent permitted by applicable law, each
Member waives any objection to the imposition of such relief.
12.4 REMEDIES CUMULATIVE. All rights, powers and remedies
provided under this Agreement or otherwise available in respect hereof at law or
in equity shall, unless otherwise specifically provided herein, be cumulative
and not alternative, and the exercise or beginning of the exercise of any right,
power or remedy thereof by a Member shall not preclude the simultaneous or later
exercise of any other such right, power or remedy by such Member.
12.5 SUCCESSORS AND ASSIGNS. This Agreement shall be binding
upon and shall inure to the benefit of the Members and their respective
successors and permitted assigns. No Member may assign its rights or delegate
its duties under this Agreement without the written consent of the other Members
except to the extent expressly provided in this Agreement.
12.6 NO THIRD PARTY BENEFICIARIES. This Agreement is entered
into solely for the benefit of the Members and no Person other than the Members,
their respective successors and permitted assigns, their Affiliates to the
extent expressly provided herein, and (to the extent provided in Article 11) the
Persons entitled to indemnification pursuant to Article 11, may exercise any
right or enforce any obligation hereunder.
12.7 FURTHER ASSURANCES. Each Member will execute and
deliver such further documents and take such further actions as any other
Member may reasonably request consistent with the provisions hereof in order
to effect the intent and purposes of this Agreement.
12.8 NOTICES. All notices or other communications hereunder
shall be in writing and shall be deemed to have been duly given or made (i) upon
delivery if delivered personally (by courier service or otherwise) or (ii) upon
confirmation of dispatch if sent by facsimile transmission (which confirmation
shall be sufficient if shown on the journal produced by the facsimile machine
used for such transmission), and all legal process with regard hereto shall be
validly served when served in accordance with applicable law, in each case to
the applicable addresses set forth below (or such other address as the recipient
may specify in accordance with this Section):
If to a Member or Representative of the DCC Member Group, to
such Member or Representative:
c/o Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: General Counsel
Fax: (405) 529-8765
56
<PAGE>
with a copy to:
Edwards & Angell, LLP
2800 BankBoston Plaza
Providence, RI 02903
Attn: David K. Duffell
Fax: (401) 276-6611
If to a Member or Representative of the AWS Member Group, to
such Member or Representative:
c/o AT&T Wireless Services, Inc.
7277 164th Avenue, NE
Redmond, WA 98052
Attn: William W. Hague
Fax: (425) 580-8405
with a copy to:
AT&T Wireless Services, Inc.
7277 164th Avenue, NE
Redmond, WA 98052
Attn: General Counsel
Fax: (425) 580-8333
If to any other Member, to the address of such Person for notices set forth in
the records of the Company.
12.9 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Delaware, without
regard to principles of conflicts of law.
12.10 SEVERABILITY. If any term of this Agreement or the
application thereof to any Member or any circumstance shall be held invalid or
unenforceable to any extent, the remainder of this Agreement and the application
of such term to the other Members or circumstances shall not be affected thereby
and shall be enforced to the greatest extent permitted by applicable law, so
long as the economic and legal substance of this Agreement and the actions
contemplated hereby is not affected in any manner adverse to any Member.
12.11 INDEPENDENT CONTRACTORS. The Members are independent
contractors, and this Agreement does not create a partnership or agency
relationship between the Members, or any other relationship between the Members
except as expressly set forth herein. No Member shall have any right or
authority to assume, create or incur any liability or obligation, express or
implied, in the name or on behalf of any other Member.
57
<PAGE>
12.12 DISPOSITION OF INTERESTS. Upon the sale or other
disposition by a Person of all its Interests in the Company, following which
such Person and Affiliate thereof is no longer a Member of the Company, this
Agreement shall terminate as to such Member and its Affiliates except as
provided in Section 12.13.
12.13 SURVIVAL OF RIGHTS AND DUTIES. Termination of this
Agreement for any reason shall not relieve any Member of any liability which at
the time of termination has already accrued to such Member or which thereafter
may accrue in respect of any act or omission prior to such termination, nor
shall any such termination affect in any way the other Related Agreements or the
survival of any right, duty or obligation of any Member which is expressly
stated elsewhere in this Agreement to survive termination hereof. Sections 8.3,
8.9 and 8.11 and Articles 11 and 12 shall survive any termination of this
Agreement, including any termination pursuant to Section 12.12 in connection
with the consummation of a purchase and sale transaction pursuant to the
Buy-Sell Procedure.
12.14 COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
of which together shall constitute one instrument.
12.15 CONSTRUCTION. Each of the parties hereto acknowledges
that it has reviewed this Agreement and that the normal rule of construction to
the effect that any ambiguities are to be resolved against the drafting party
shall not be employed in the interpretation of this Agreement or any amendments
hereto. The captions used herein are for convenience of reference only and shall
not affect the interpretation or construction hereof. All pronouns and any
variations thereof shall be deemed to refer to the masculine, feminine, neuter,
singular or plural as the context may require. Unless otherwise specified, (a)
the terms "hereof," "herein" and similar terms refer to this Agreement as a
whole, (b) references herein to Articles or Sections refer to articles or
sections of this Agreement and (c) the word "including" connotes the words
"including without limitation" unless the context requires otherwise.
12.16 NO RIGHT TO PARTITION. No Member shall have the
right to bring an action for partition against the Company. Each of the
Members hereby irrevocably waives any and all rights which it may have to
maintain an action to partition Company property or to compel any sale or
transfer thereof.
12.17 DE FACTO AND DE JURE TRANSFERS OF CONTROL.
Notwithstanding anything to the contrary contained herein, to the extent that,
by reason of any action taken or proposed to be taken, by or on behalf of a
Member or any Member Group (including any actions taken in accordance with the
provisions of Articles 7, 8, or 9 of this Agreement), there would be a de jure
or de facto transfer of control of the Company, (a) if such transfer of control
requires prior notice to, or the prior approval of, the FCC, then no such action
shall be taken unless and until the FCC has approved such transfer of control,
and in such case, the Member proposing to take (or whose Member Group is
proposing to take) such action shall be responsible for assuring that all
required notifications or applications to the FCC have been
58
<PAGE>
filed, and all required consents from the FCC have been obtained, before such
transfer of control is made; and (b) if such transfer of control requires
notification to the FCC after it has occurred, the Member taking such action
(or whose Member Group has taken such action) shall be responsible for
assuring that all required notifications to the FCC have been filed. In any
such event, the responsible Member shall assure that all required
applications and/or notifications are timely filed and are accurate and
complete in all material respects, and such Member shall execute and file any
such applications or notifications on behalf of the Company.
[SIGNATURE PAGE FOLLOWS]
59
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
AT&T WIRELESS SERVICES JV CO.
By: /s/ Don Adams
----------------------------------
Name: Don Adams
Title: Vice President
DOBSON JV COMPANY
By: /s/ Bruce R. Knooihuizen
----------------------------------
Name: Bruce R. Knooihuizen
Title: V.P. and Chief Financial
Officer
Agreed and accepted with respect
to Sections 8.1, 8.2, 8.3 and 8.4 only:
AT&T CORP.
By: /s/ Gregory P. Landis
----------------------------------
Name: Gregory P. Landis
Title: Vice President
60
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
-----------------
Page
----
<S> <C> <C>
ARTICLE 1 DEFINITIONS............................................................................................1
ARTICLE 2 ORGANIZATION..........................................................................................17
2.1 Name..............................................................................................17
2.2 Principal Place of Business.......................................................................17
2.3 Registered Office; Registered Agent...............................................................18
2.4 Term..............................................................................................18
2.5 Purpose and Powers................................................................................18
2.6 Filings...........................................................................................18
2.7 Sole Agreement....................................................................................18
ARTICLE 3 CAPITALIZATION........................................................................................18
3.1 Capital Accounts..................................................................................18
3.2 Capital Contributions.............................................................................20
3.3 No Withdrawals....................................................................................21
ARTICLE 4 PROFITS AND LOSSES....................................................................................21
4.1 Profits...........................................................................................21
4.2 Limitation on Losses..............................................................................21
4.3 Special Allocations...............................................................................21
4.4 Curative Allocations..............................................................................22
4.5 Allocation of Credits.............................................................................23
4.6 Tax Allocations...................................................................................24
4.7 Change in Member's Interests......................................................................25
ARTICLE 5 DISTRIBUTIONS.........................................................................................25
5.1 Distributable Cash................................................................................25
5.2 Liquidating Distributions.........................................................................25
ARTICLE 6 ACCOUNTING AND RECORDS................................................................................25
6.1 Fiscal Year.......................................................................................26
6.2 Method of Accounting..............................................................................26
6.3 Books and Records; Inspection.....................................................................26
6.4 Financial.........................................................................................26
6.5 Taxation..........................................................................................27
ARTICLE 7 MANAGEMENT............................................................................................31
7.1 Management........................................................................................31
7.2 Meetings of Management Committee..................................................................32
7.3 Actions by Management Committee...................................................................33
ARTICLE 8 OPERATING AGREEMENTS AND OTHER COVENANTS..............................................................34
8.1 Limited Exclusivity...............................................................................34
8.2 Roaming Preference................................................................................35
8.3 Resale and Agency Agreements......................................................................36
8.4 Long Distance.....................................................................................37
i
<PAGE>
8.5 Equipment Discounts...............................................................................37
8.6 Roaming Agreements................................................................................37
8.7 Certain Restrictions..............................................................................38
8.8 Other Business; Duties; Etc.......................................................................38
8.9 Confidentiality...................................................................................38
8.10 Conversion to Corporation.........................................................................39
8.11 Dispute Resolution................................................................................40
8.12 Disqualifying Transaction.........................................................................42
ARTICLE 9 TRANSFER RESTRICTIONS; EXIT RIGHTS; CHANGE OF CONTROL OF DCC..........................................42
9.1 General Restrictions on Transfers.................................................................42
9.2 Right of First Refusal............................................................................44
9.3 Tag-Along Right...................................................................................45
9.4 Indirect Transfers................................................................................46
9.5 Substituted.......................................................................................47
9.6 Invalid Transfers Void............................................................................47
9.7 Determination of Fair Market Value................................................................47
9.8 Change of Control of DCC..........................................................................48
9.9 Buy-Sell Procedure................................................................................49
9.10 IPO...............................................................................................51
ARTICLE 10 DISSOLUTION AND TERMINATION..........................................................................51
10.1 No Withdrawal.....................................................................................51
10.2 Dissolution.......................................................................................51
10.3 Procedures Upon Dissolution.......................................................................51
10.4 Termination.......................................................................................52
ARTICLE 11 EXCULPATION AND INDEMNIFICATION......................................................................53
11.1 No Personal Liability.............................................................................53
11.2 Indemnification by Company........................................................................53
11.3 Notice and Defense of Claims......................................................................53
ARTICLE 12 MISCELLANEOUS........................................................................................55
12.1 Entire Agreement..................................................................................55
12.2 Amendment; Waiver.................................................................................55
12.3 Specific Performance..............................................................................56
12.4 Remedies Cumulative...............................................................................56
12.5 Successors and Assigns............................................................................56
12.6 No Third Party Beneficiaries......................................................................56
12.7 Further Assurances................................................................................56
12.8 Notices...........................................................................................56
12.9 Governing Law.....................................................................................57
12.10 Severability......................................................................................57
12.11 Independent Contractors...........................................................................57
12.12 Disposition of Interests..........................................................................58
12.13 Survival of Rights and Duties.....................................................................58
12.15 Construction......................................................................................58
ii
<PAGE>
12.16 No Right to Partition.............................................................................58
12.17 De Facto and De Jure Transfers of Control.........................................................59
</TABLE>
SCHEDULES AND EXHIBITS
----------------------
Schedule I -- Core Service Features
Schedule II -- Dobson Group
Schedule III -- Territory
Schedule 8.1(a)(iv) -- Tritel Licenses
Schedule 8.1(a)(v) -- AT&T Licenses
Schedule 9.4 -- JWC Investors
Exhibit A -- Significant Matters
iii
<PAGE>
AMENDED AND RESTATED SUPPLEMENTAL AGREEMENT
Amended and Restated Supplemental Agreement, dated as of February 25,
2000, among AT&T Wireless Services, Inc., a Delaware corporation ("AWS"), Dobson
Communications Corporation, an Oklahoma corporation ("DCC"), Dobson CC Limited
Partnership and the other signatories hereto. Capitalized terms used but not
defined herein have the meanings given to such terms in the LLC Agreement
referred to below.
Whereas, AT&T Wireless Services JV Co., a Delaware corporation ("AWS
Sub") and a wholly owned subsidiary of AWS, and Dobson JV Company, an Oklahoma
corporation ("DCC Sub") and a wholly owned subsidiary of DCC, are entering into
a Second Amended and Restated Limited Liability Company Agreement, dated as of
the date hereof (the "LLC Agreement"), relating to ACC Acquisition LLC, a
Delaware limited liability company (the "Company"); and
Whereas, the parties hereto entered into a Supplemental Agreement,
dated as of January 31, 2000 (the "Original Agreement"), and are entering into
this Agreement as a material inducement to the execution and delivery of the LLC
Agreement by AWS Sub and DCC Sub.
Now, therefore, in consideration of the mutual promises hereinafter set
forth, the parties hereby agree, and the Original Agreement is hereby amended
and restated in its entirety, as follows:
1. TRANSFER RESTRICTIONS. The parties hereby acknowledge the
restrictions on Transfers of Interests in the Company set forth in Article 9 of
the LLC Agreement, including but not limited to the restrictions on Indirect
Transfers set forth in Section 9.4 thereof, and agree to be bound by such
provisions to the same extent as if they had executed the LLC Agreement.
2. NOTICE OF TRANSFER. Prior to any Indirect Transfer of Interests
by a party hereto, the transferor shall, if the Specified Restrictions apply
to such Transfer pursuant to Section 9.4 of the LLC Agreement, deliver to the
other parties hereto a notice setting forth the identity of the transferee
and (if applicable) stating that such transferee is a member of the
transferor's Affiliate Group, and shall provide such other information as the
other parties hereto may reasonably request in connection with such Transfer.
Concurrently with any such Indirect Transfer, the transferor shall cause the
transferee to execute, and distribute to the other parties hereto, a
counterpart to this Agreement evidencing the transferee's agreement to be
bound hereby.
3. MISCELLANEOUS. This agreement (i) together with the LLC Agreement
contains the entire agreement among the parties hereto as to the subject matter
set forth in paragraph 1 above, (ii) shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without giving effect to
Delaware's conflict of law rules, and (iii) may be executed in any number of
counterparts, all of which when taken together shall constitute one and the same
instrument and any of the parties hereto may execute this letter agreement by
signing any such counterpart.
<PAGE>
[SIGNATURE PAGES TO FOLLOW]
<PAGE>
In witness whereof, the parties have executed this Agreement as of the
date first above written.
AT&T WIRELESS SERVICES, INC.
By /s/ Don Adams
-------------------------------------
Name: Don Adams
Title: Vice President
<PAGE>
DOBSON COMMUNICATIONS CORPORATION
By /s/ Everett Dobson
-------------------------------------
Name: Everett Dobson
Title: CEO and Chairman
DOBSON CC LIMITED PARTNERSHIP
By RLD, Inc., Its General Partner
By /s/ Everett Dobson
-------------------------------------
Name: Everett Dobson
Title: President
RLD, Inc.
By /s/ Everett Dobson
-------------------------------------
Name: Everett Dobson
Title: President
<PAGE>
THE EVERETT R. DOBSON IRREVOCABLE
FAMILY TRUST
By /s/ Everett Dobson
-------------------------------------
Name: Everett Dobson
Title: Trustee
THE STEVEN T. DOBSON IRREVOCABLE
FAMILY TRUST
By /s/ Everett Dobson
-------------------------------------
Name: Everett Dobson
Title: Trustee
THE ROBBIN L. DOBSON IRREVOCABLE
FAMILY TRUST
By /s/ Everett Dobson
-------------------------------------
Name: Everett Dobson
Title: Trustee
<PAGE>
- -------------------------------------------------------------------------------
AMENDED AND RESTATED
MANAGEMENT AGREEMENT
between
DOBSON CELLULAR SYSTEMS, INC.
and
ACC ACQUISITION LLC
Dated as of February 25, 2000
- -------------------------------------------------------------------------------
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
----
<S> <C> <C>
Section 1. Engagement.........................................................................2
Section 2. Management Standards...............................................................2
Section 3. Services to be Provided............................................................2
Section 4. Compensation.......................................................................7
Section 5. Term and Termination...............................................................8
Section 6. Noncompetition and Confidentiality................................................11
Section 7. Force Majeure.....................................................................12
Section 8. Books and Records.................................................................12
Section 9. Regulatory Compliance.............................................................13
Section 10. Dispute Resolution................................................................14
Section 11. Inspection Rights; Delivery of Information........................................14
Section 12. Miscellaneous.....................................................................15
Exhibit 2(c) Quality Standards
Exhibit 3(c) Financial Performance Standards
Exhibit 4(b)(i) Cost Allocation Methodology
Exhibit 4(b)(ii) Per Unit Cost Comparison
Exhibit 5(e) Integration with DCC Systems
</TABLE>
i
<PAGE>
AMENDED AND RESTATED MANAGEMENT AGREEMENT
-----------------------------------------
This Amended and Restated Management Agreement (the "Agreement") is
entered into as of February 25, 2000 by and between Dobson Cellular Systems,
Inc., an Oklahoma corporation ("Manager"), and ACC Acquisition LLC, a Delaware
limited liability company (the "Company"). Capitalized terms used but not
defined in this Agreement shall have the meanings given to such terms in the
Amended and Restated Limited Liability Company Agreement of the Company, dated
as of date hereof (the "LLC Agreement").
WHEREAS, the operation of the Business, including, without
limitation, the determination of policy, the preparation and filing of any and
all applications and other filings with the FCC, the hiring, supervision and
dismissal of personnel, day-to-day system operations, and the payment of
financial obligations and operating expenses, shall be controlled by the
Company, and Manager shall assist the Company in connection therewith and any
action undertaken by Manager shall be under the Company's continuing
oversight, review, control and approval, and the Company shall retain
unfettered control of, access to, and use of the Business, including its
facilities and equipment and shall be entitled to receive all profits from the
operation of the Business;
WHEREAS, Manager is an indirect wholly owned subsidiary of Dobson
Communications Corporation ("DCC"), which owns 50% of the Economic Interests
and 50% of the Voting Interests of the Company;
WHEREAS, the Company owns all of the equity interests in ACC
Acquisition Co., which as of the Effective Date (as defined below) will own
certain Cellular Systems and PCS Systems;
WHEREAS, Manager is willing to provide management services for the
Company and its Subsidiaries (including ACC Acquisition Co.) on the terms and
subject to the conditions contained in this Agreement; and
WHEREAS, the parties entered into a Management Agreement dated as of
January 31, 2000 (the "Original Agreement"), and desire to execute this
Agreement to amend and restate the terms upon which Manager will perform
services to the Company hereunder.
NOW, THEREFORE, for and in consideration of the premises, the
covenants and agreements set forth herein, and other good and valuable
consideration, the receipt and sufficiency of which are acknowledged by the
execution and delivery hereof, the parties agree, and the Original Agreement
is hereby amended and restated in its entirety, as follows:
<PAGE>
Section 1. ENGAGEMENT. The Company hereby engages Manager to oversee,
manage and supervise the development and operation of the Business, and
Manager hereby accepts such engagement, subject to and upon the terms and
conditions hereof.
Section 2. MANAGEMENT STANDARDS.
(a) Manager shall discharge its duties hereunder in compliance
with the LLC Agreement and the Operating Agreement (collectively, the
"Operating Agreements") and all applicable law. In performing its obligations
hereunder, Manager shall act in a manner that it reasonably believes to be in
the best interests of the Company consistent with the standards set forth
herein. Nothing in this Agreement shall be construed as constituting Manager
an agent of the Company beyond the extent expressly provided in, and as
limited by, this Agreement.
(b) Manager shall devote comparable attention and services to
the Company as those devoted by Manager (or any Affiliate of DCC that manages
DCC's wireless communications systems) in its management of other wireless
communications systems or markets directly or indirectly owned or managed by
Manager, and will otherwise deal with the Company subject to the terms of this
Agreement in a manner that does not discriminate against the Company in favor
of such other markets.
(c) Manager shall use reasonable best efforts to cause the
Company's Cellular Systems to comply in each of the Company's markets with the
Quality Standards set forth on Exhibit 2(c).
Section 3. SERVICES TO BE PROVIDED.
(a) SCOPE OF SERVICES. Subject to the Company's oversight,
review and ultimate control and approval and the limitations of Section 3(c)
below, Manager shall be responsible for the supervision, design, construction
and operation of the Company and the Business in accordance with the Operating
Agreements. Among other things, Manager shall have the right to select the
persons who shall perform all design, construction, management or operational
services and may elect to use its own employees or engage independent
contractors. To this end Manager shall provide generally, on the terms and
subject to the conditions set forth herein and in a manner consistent with the
standards set forth herein and in the Operating Agreements, supervisory
services with respect to (x) all administrative, accounting, billing, credit,
collection, insurance, purchasing, clerical and such other general services as
may be necessary to the administration of the Business, (y) operational,
engineering, maintenance, construction, repair and such other technical
services as may be necessary to the construction and operation of the
Business, and (z) marketing, sales, advertising and such other promotional
services as may be necessary to the marketing of the Business. The services
for which Manager shall be responsible, subject in each case to the Operating
Agreements, the Company's oversight, review and ultimate control and approval
and to
2
<PAGE>
the limitations of Section 3(c) below, shall include but shall not be limited
to the following:
(i) the marketing of Mobile Wireless Services (and,
to the extent determined by the Management Committee, other Company
Communications Services) to be offered and provided by the Company;
(ii) the management, tax compliance, accounting and
financial reporting for the Company including, but not limited to, the
preparation and presentation of reports and reviews of the business,
financial results and condition, regulatory status, competitive
position and strategic prospects of the Company as requested by the
Management Committee;
(iii) the regulatory processing for the Company,
including without limitation the preparation and filing of all
appropriate regulatory filings, certificates, tariffs and reports that
are required by, and participation in any hearings or other
proceedings before, local, state and federal governmental regulatory
bodies;
(iv) the engineering, design, planning, construction
and installation, maintenance and repair (both emergency and routine)
and operation of, and equipment purchases for, the Company;
(v) assisting the Company in the development and
preparation of budgets, including, without limitation, preparing and
presenting, not later than 60 days before the beginning of each fiscal
year (it being understood that the annual budgets for the first three
years shall be based on, in terms of format and level of detail, the
initial three-year budget of the Company, provided, that any such
annual budget shall supersede the initial three-year budget with
respect to the year covered by such annual budget), a proposed draft
of an annual operating budget for the Company's review, evaluation and
approval setting forth in reasonable detail the anticipated capital
expenditures and other projected costs and expenses of constructing
and operating the Business during the period covered by the budget,
as well as projected revenues for that period, a business plan and
personnel requirements, and key performance standards, goals and
indicators for the Company, for the period covered by the budget, in
each case presented on a month-by-month basis to the extent
practicable, and generally describing all contracts and commitments
which Manager expects to enter into on behalf of the Company during
the period covered thereby;
(vi) services relating to sales of the products and
services offered by the Company, including without limitation
processing orders for service, customer support, billing for services
provided by the Company and collection of receivables for the Company;
(vii) management information services for the
Company;
3
<PAGE>
(viii) monitoring and controlling the Business and
its Cellular Systems;
(ix) negotiating contracts, issuing purchase orders
and otherwise entering into agreements on behalf of the Company for
the purchase, lease, license or use of such properties, services and
rights as may be necessary or desirable in the judgment of Manager
for the operation of the Company;
(x) supervising, recruiting and training all
necessary personnel to be employed by the Company, and determining
salaries, wages and benefits for the Company's employees;
(xi) administering the Company's employee benefit
programs and the Company's programs for compliance with applicable
laws governing the administration and operation of such plans and
programs;
(xii) administering the Company's risk management
programs, including negotiating the terms of property and casualty
insurance and preparing a comprehensive disaster recovery program; and
(xiii) in furtherance of the foregoing, making or
committing to make permitted expenditures (including permitted capital
expenditures) on behalf of the Company.
(b) ACCOUNTS. Subject to the foregoing, the Company shall be
responsible for payment of all costs and expenses necessary to fund the
ongoing business and operations of the Business and for the provision of all
services of Manager hereunder, which shall include, but not be limited to,
payments under Section 4, payments to independent contractors, payments to
vendors and suppliers of the Business, and interest payments to creditors who
have financed the construction or operation of the Business. To the extent
provided herein, Manager shall make such payments on the Company's behalf from
one or more accounts maintained in the name of the Company at one or more
banks acceptable to the Management Committee, into which all Company revenues
shall be deposited (the "Accounts"). All funds of the Company shall be
promptly deposited in such bank accounts. All disbursements made by the
Company as permitted under this Agreement shall be made by checks drawn on the
Accounts, and all funds on deposit in the Accounts shall at all times be the
property of the Company. Manager will have the right and authority to make
deposits to and disbursements and withdrawals from the Accounts as required in
connection with the performance of its services hereunder, PROVIDED that all
signatories on the Accounts shall be subject to the approval of the Management
Committee. The executive officers of the Manager shall be deemed to be
signatories who have been approved by the Management Committee.
(c) RESTRICTIONS ON MANAGER'S AUTHORITY. Anything to the
contrary in this Agreement notwithstanding, Manager shall not take, or cause
or permit to be taken, any action that requires the approval of the Management
Committee under Section 7.3 of
4
<PAGE>
the LLC Agreement (including, if applicable, by reference to Exhibit A to the
LLC Agreement), or do, or cause or permit to be done, any of the following
for or on behalf of the Company without the prior written consent of the
Management Committee (unless included with reasonable specificity in a budget
duly adopted by the Company):
(i) settle any claim or litigation by or against
the Company if the settlement involves a payment of $100,000 or more,
or any non-ministerial regulatory proceedings involving the Company;
(ii) (A) lend money or guarantee debts of others
(other than wholly-owned Subsidiaries of the Company) on behalf of the
Company, or assign, transfer, or pledge any debts due the Company, or
(B) release or discharge any debt due or compromise any claim of the
Company, other than trade credit and advances to employees in the
ordinary course of business;
(iii) invest in or otherwise acquire any debt or
equity securities of any other Person, enter into any binding agreement
for the acquisition of any interest in any business entity or other
Person (whether by purchase of assets, purchase of stock or other
securities, merger, loan or otherwise), or enter into any joint venture
or partnership with any other Person;
(iv) take any tax reporting position or make any
related election on behalf of the Company which is inconsistent with
the directions given by the Management Committee;
(v) assert on behalf of the Company a position with
respect to any material matter, or disagree on behalf of the Company
with a position taken with respect to any material matter by a Member
or any other Person, before the Federal Communications Commission or
any other Governmental Authority, a self-regulatory body, any industry
organization or in any other public forum;
(vi) knowingly take or fail to take any action that
violates (A) any law, rule or regulation relating to the Business, (B)
any material agreement, arrangement or understanding to which the
Company is a party, including an Operating Agreement, (C) any License
or other governmental authorization granted to the Company in
connection with its ownership and operation of the Business, or (D) any
judicial or administrative order or decree to which the Company is
subject;
(vii) sell, assign, transfer, or otherwise dispose
of, or hypothecate or grant a Lien on any License or other material
assets belonging to the Company (other than the disposal of assets or
equipment in the ordinary course of business);
(viii) take any action amending or agreeing to amend
any License granted to the Company in connection with its ownership and
operation of the
5
<PAGE>
Business (it being understood that License renewals in the ordinary
course of business shall not require Management Committee approval);
(ix) borrow money on behalf of the Company or enter
into other forms of financing for the Business, other than any capital
lease;
(x) commingle any funds of the Company with funds
of any other entity or Person;
(xi) hire or fire the independent certified public
accountants of the Company;
(xii) pay to any employee or agent of, or consultant
or advisor to, the Company, cash compensation in excess of $150,000 in
any fiscal year;
(xiii) establish any reserves that are not set forth
on the quarterly financial reports provided to the Management
Committee;
(xiv) make any material changes or modifications to
any significant components of the Company's Cellular Systems as they
exist on the Effective Date;
(xv) enter into any contract, agreement (including
any capital lease) or other commitment or issue any purchase order,
which contract or other agreement or purchase order (A) is not in the
ordinary course of business, (B) obligates the Company to make payments
of $100,000 or more within any 12-month period or (C) could reasonably
be expected to create a material variance relative to (x) in the case
of a capital expenditure, the total budget for capital expenditures
contained in any budget approved by the Management Committee and (y) in
the case of an operating expense, the total operating expense budget
contained in any budget approved by the Management Committee, in each
case for the year-to-date period in which the expenditure is made or
incurred and taking into account all previous expenditures and
commitments in such year-to-date period; or terminate or amend in any
material respect any contract, agreement or other commitment or
purchase order, in each case if the execution and delivery or issuance
thereof requires approval pursuant to this Section 3(c); or
(xvi) enter into, or commit to enter into, any
agreement, arrangement or understanding that could reasonably be
expected to have an adverse effect on the Company's ability to comply
in any material respect with the Quality Standards set forth in Exhibit
2(c) or the financial performance standards set forth in Exhibit 3(c).
PROVIDED, that if this Agreement is terminated by the Company pursuant to
5(b)(ii)(B), and AT&T designates the New Provider (as defined in Section
5(e)(i)), such New Provider may do, or cause or permit to be done, for or on
behalf of the Company, without
6
<PAGE>
the prior written consent of the Management Committee, any of the actions set
forth in clauses (i) through (xvi) above; PROVIDED, FURTHER, that anything
herein to the contrary notwithstanding, the New Provider shall not take any
action set forth on Exhibit B to the LLC Agreement without obtaining approval
of the Management Committee in the manner specified in the LLC Agreement.
Prior to the effectiveness of any assignment to a New Provider, such Person
shall agree in writing to become bound by this Agreement.
(d) BUDGETS. Manager shall prepare or cause to be prepared
and present not later than 30 days before the beginning of each fiscal year
following the fiscal year 2000 an annual operating budget (with quarterly
forecasts) for the Company's review, evaluation and approval (each, as duly
approved by the Company, an "Operating Budget"). Each Operating Budget shall
set forth in reasonable detail the anticipated capital expenditures and other
projected costs and expenses of operating the Company's Cellular Systems
during the period covered by the budget, as well as projected revenues for
that period and the projected reportable income for such quarter and Manager
shall endeavor to assure the accuracy of its estimates. Prior approval by the
Company shall be required for any expenditure which would result in operating
expenditures exceeding any summary line item in an Operating Budget by more
than 10 percent or the total amount of expenses contemplated by an Operating
Budget by more than 10 percent.
(e) TRANSACTIONS WITH AFFILIATES. Notwithstanding anything
in this Agreement to the contrary, without the prior approval of the
Management Committee, Manager shall not (and shall cause the Company and its
Subsidiaries not to) enter into any agreement, arrangement or understanding
with Manager or any of its Affiliates or any member of the Dobson Group
except in the ordinary course of the Business of the Company and on
commercially reasonable terms that are no less favorable to the Company or
its Subsidiaries than the Company or its Subsidiaries would obtain in a
comparable arm's-length transaction with an unaffiliated Person. In its
request for approval of the Management Committee, Manager shall specify that
the applicable transaction is subject to this Section 3(e).
Section 4. COMPENSATION.
(a) REIMBURSEMENT. The Company shall reimburse Manager for
all out-of-pocket expenses ("Out-of-Pocket Expenses") reasonably incurred by
Manager for goods and services provided by third parties to, for or on behalf
of the Company or incurred by Manager in the performance of its duties and
responsibilities hereunder. Manager shall provide the Company with a
statement setting forth in reasonable detail (and with copies of invoices or
other supporting documentation) the Out-of-Pocket Expenses claimed within
thirty (30) days after they are incurred, provided, that Out-of-Pocket
Expenses incurred in the last thirty (30) days of any fiscal year shall be
claimed or estimated in good faith at least two weeks prior to the end of
such fiscal year. The Company shall pay to Manager each such amount within
thirty (30) days of receipt of such statement and invoices or other
supporting documentation (it being understood that
7
<PAGE>
estimated Out-of-Pocket Expenses will not be reimbursed until Manager
provides the Company with the invoices or other supporting documentation
therefor).
(b) COST ALLOCATIONS. To the maximum extent practicable,
Manager and its Affiliates will specifically identify costs associated with
the Business, which shall be reimbursed by the Company as Out-of-Pocket
Expenses in accordance with Section 4(a). To the extent that such specific
identification is impracticable, Manager shall charge the Company "Cost
Allocations" for those common costs which benefit the Company (including an
appropriate portion of Manager's general overhead expenses). Cost Allocations
(including without limitation the cost of services directly allocable to the
Company that are performed by employees of DCC or its Affiliates) shall be
calculated in the manner set forth in Exhibit 4(b)(i). Manager shall cause to
be furnished to the Company, at Company's expense, an accounting of any such
Cost Allocations, and the Company shall pay to Manager such amount within
thirty (30) days of receipt of such accounting. Exhibit 4(b)(ii) sets forth
by category in reasonable detail the per unit costs incurred by American
Cellular Corporation in 1999, the per unit costs incurred by Manager and its
Affiliates in 1999, and Manager's good faith estimate of the projected per
unit costs to be incurred by the Company in 2000, in operating their
respective Cellular Systems.
(c) DISPUTES, ETC. If the Company disputes the amount of
Out-of-Pocket Expenses or Cost Allocations claimed by Manager, the Company
shall notify Manager in writing before payment is due, and if the matter
cannot be resolved informally between the parties, either the Company or
Manager may request resolution of the dispute pursuant to Section 10.
Section 5. TERM AND TERMINATION.
(a) TERM. This Agreement shall commence on the Closing Date
under the Agreement and Plan of Merger dated as of October 5, 1999 among the
Company, ACC Acquisition Co. and American Cellular Corporation (the
"Effective Date") and shall terminate as provided herein or under the LLC
Agreement.
(b) TERMINATION.
(i) BY EITHER PARTY. Either party may terminate this
Agreement in the event that a Governmental Authority shall enter an
order appointing a custodian, receiver, trustee, intervenor or other
officer with similar powers with respect to the other party or with
respect to any substantial part of its property, or constituting an
order for relief or approving a petition in bankruptcy or insolvency
law of any jurisdiction, or ordering the dissolution, winding up or
liquidation of such party; or if a party files a petition seeking any
such order; or if any such petition shall be filed against such party
and shall not be dismissed within one hundred and twenty (120) days
thereafter; or an order shall have been issued
8
<PAGE>
granting such party a suspension of payments under applicable law and
any such order is not dismissed within one hundred and twenty (120)
days thereafter.
(ii) BY COMPANY. The Company (acting through the
Management Committee, excluding the Representatives appointed by DCC)
may terminate this Agreement:
(A) on five (5) days' notice in the event of
a material breach of this Agreement by Manager (as determined
by the Management Committee, excluding the Representatives
appointed by DCC), which has not been cured within sixty (60)
days following notice thereof from the Company;
(B) on five (5) days' notice if (I) the DCC
Affiliate Group ceases to be a Qualified Member Group or (II)
a Change of Control of DCC occurs and (x)(1) a Prohibited
Transferee (alone or as part of a "group" as such term is used
in Sections 13(d) and 14(d) of the Exchange Act and the
regulations thereunder) or (2) prior to the second anniversary
of the Effective Date, any other Person (alone or as part of a
"group" as such term is used in Sections 13(d) and 14(d) of
the Exchange Act and the regulations thereunder) or (3) on or
after the second anniversary of the Effective Date, a Person
that is not a Prohibited Transferee (alone or as part of a
"group" as such term is used in Sections 13(d) and 14(d) of
the Exchange Act and the regulations thereunder), acquires
control of Dobson and (y)(1) either the Company is a limited
liability company and the AWS Affiliate Group is a Qualified
Member Group or (2) the Company has converted to a corporation
and the AWS Affiliate Group retains at least 50% of its
initial economic interests or (III) Manager ceases to be a
wholly owned subsidiary of DCC; provided, in the case of
clause (II)(x)(3) only, that AWS Sub shall, within 60 days
after the Change of Control of DCC, have elected in its
reasonable discretion to cause the Company to (and the Company
thereupon shall) terminate this Agreement;
(C) on five (5) days' notice if the Company
(acting through the Management Committee, excluding the
Representatives appointed by DCC) has notified Manager of the
Company's failure to comply with the Quality Standards in any
material respect, and such failure has not been cured within
sixty (60) days thereafter or, if such breach is not capable
of being cured on commercially reasonable terms within such
sixty (60) day period, within one-hundred eighty (180) days of
such notice, provided that Manager is using reasonable best
efforts to cure such breach as soon as reasonably practicable;
and
(D) on five (5) days' notice if the Company
fails to comply with the financial performance standards set
forth on Exhibit 3(c).
9
<PAGE>
(iii) BY MANAGER. Manager may terminate this
Agreement on five (5) days' notice in the event of a material breach of
this Agreement by the Company (other than a payment default) which has
not been cured within sixty (60) days following notice thereof from
Manager.
(c) REMEDIES. The remedies set forth herein are not
intended to be exclusive, and all remedies shall be cumulative and may be
exercised concurrently with any other remedy available to Manager or the
Company at law or in equity.
(d) CONTINUING OBLIGATIONS. Notwithstanding the provisions
of Sections 6(a) and (b), no termination of this Agreement shall take effect
until the expiration of the Transition Period (as defined below). After
receipt of written notice of termination, but prior to the expiration of the
Transition Period, Manager shall continue to perform under this Agreement
unless specifically instructed (by the Management Committee, excluding the
Representatives appointed by DCC) to discontinue such performance in whole or
in part. In the event of termination, Manager and the Company shall remain
liable for their respective obligations accrued under this Agreement prior to
the expiration of the Transition Period.
(e) TRANSITION ARRANGEMENTS.
(i) GENERAL. In the event of termination of this
Agreement for any reason, Manager shall, during the Transition Period,
at the Company's expense, cooperate with the Company in order to
facilitate the transition to a new management service provider (the
"New Provider"), who shall be designated by AWS in its sole discretion
(and which may be, at the election of AWS, an Affiliate of AWS).
Manager shall at the Company's expense take all commercially reasonable
steps to assist the New Provider in assuming the management of the
Company and the operation of the Company's Cellular Systems including,
without limitation, transferring to the New Provider all historical
financial, tax, accounting, billing and other data with respect to the
Company in the possession of Manager or its Affiliates, and giving such
consents, assigning such permits and executing such instruments as may
be necessary to vest in the New Provider those rights that were used by
Manager to perform its services hereunder. Exhibit 5(e) sets forth
those items of information and other assets and properties of the
Company that Manager anticipates will be integrated in whole or in part
with the operations of Manager or its Affiliates in the course of
Manager's performance of its obligations hereunder, and that will
accordingly need to be transferred to the Company or the New Provider
in connection with any termination of this Agreement.
(ii) USE OF MANAGER MARKS. Notwithstanding anything
herein to the contrary, in the event of termination of this Agreement
by Manager other than pursuant to Section 5(b)(i) or Section 5(b)(iii),
Manager shall use reasonable efforts to make available to the Company
on commercially reasonable terms, by
10
<PAGE>
license, sublicense or otherwise, during the Transition Period, the
right to market in those areas being served by the Company at the
commencement of the Transition Period those products and services
being marketed at the commencement of the Transition Period under
those marks owned by or licensed to Manager or its Affiliates (the
"Manager Marks") being used for such purpose at the commencement of the
Transition Period (including the "Cellular One" name and logo and, if
applicable, the "Dobson" name and logo) and, during the Transition
Period and for six (6) months thereafter, neither Manager nor any of
its Affiliates shall market under any of the Manager Marks in such
areas such products and services.
(iii) "Transition Period" means the period commencing
on the effective date of termination of this Agreement and expiring on
the later of (x) the first anniversary of such date of termination and
(y) the date on which the Company, as managed by the New Provider, is
able, in the good faith determination of AWS, to provide substantially
the same level of service to its registered and roaming customers as it
did when the Company was managed by Manager.
Section 6. NONCOMPETITION AND CONFIDENTIALITY.
(a) NONCOMPETITION. During the Transition Period, neither
Manager nor any of its Affiliates shall assist or become associated with any
person or entity, whether as a principal, partner, employee, consultant or
shareholder (other than as a holder of not in excess of 5% of the outstanding
voting shares of any publicly traded company) that is actively engaged in the
business of providing Mobile Wireless Services in the Territory.
(b) CONFIDENTIALITY. Manager shall, and shall cause each of
its Affiliates, and each of its and their respective partners, members,
managers, shareholders, directors, officers, employees and agents
(collectively, "Agents") to keep secret and retain in strictest confidence
and not use for any purpose any and all Confidential Information relating to
the Company or any member of the Company and shall not disclose such
information, and shall cause its Agents not to disclose such information, to
the same extent provided in Section 8.9 of the LLC Agreement.
(c) COMPANY PROPERTY. Promptly following the termination of
this Agreement, Manager shall return to the Company all property of the
Company, and all copies thereof in its possession or under its control, and
all tangible embodiments of Confidential Information in its possession in
whatever media such Confidential Information is maintained.
(d) NON-SOLICITATION OF EMPLOYEES. During the Transition
Period and for six months thereafter, neither Manager nor any of its
Affiliates will directly or indirectly induce any employee of the Company or
any of its Affiliates, or any employee
11
<PAGE>
of the New Provider or any of its Affiliates, to terminate employment with
such entity, and will not directly or indirectly, either individually or as
owner, agent, employee, consultant or otherwise, employ or offer employment
to any person who is or was employed by the Company or any of its Affiliates,
or by the New Provider or any of its Affiliates, unless such person shall
have ceased to be employed by such entity for a period of at least six months.
(e) INJUNCTIVE RELIEF WITH RESPECT TO COVENANTS. Manager
acknowledges and agrees that the covenants and obligations contained in this
Section 6 relate to special, unique and extraordinary matters and that a
violation of any of the terms of such covenants and obligations will cause
the Company irreparable injury for which adequate remedies are not available
at law. Therefore, Manager agrees that the Company shall be entitled to an
injunction, restraining order, or such other equitable relief as a court of
competent jurisdiction may deem necessary or appropriate to restrain Manager
and its Affiliates from committing any violation of the covenants and
obligations contained in this Section 6. These injunctive remedies are
cumulative and are in addition to any other rights and remedies the Company
may have at law or in equity.
Section 7. FORCE MAJEURE. Neither of the parties will be liable for
nonperformance or defective or late performance of any of its obligations
hereunder to the extent and for such periods of time as such nonperformance,
defective performance or late performance is due to reasons outside such
party's control, including acts of God, war (declared or undeclared), acts
(including failure to act) of any governmental authority, riots, revolutions,
fire, floods, explosions, sabotage, nuclear incidents, lightning, weather,
earthquakes, storms, sinkholes, epidemics, strikes, or delays of suppliers or
subcontractors for the same causes.
Section 8. BOOKS AND RECORDS. Manager shall maintain and oversee the
maintenance and preparation of proper and complete records and books of
account for tax and financial purposes with respect to its management of the
operation of the Business, including all such transactions and other matters
as are usually entered into records and books of account maintained by
Persons engaged in business of like character or as required by law. Manager
shall maintain and oversee the maintenance and preparation of complete
records and books of the Company for tax purposes. Books and records
maintained for financial purposes shall be maintained in accordance with
GAAP, and books and records maintained for tax purposes shall be maintained
in accordance with the Code and applicable Treasury Regulations. Within five
(5) days after the end of each month Manager shall prepare or cause to be
prepared and transmit to the Company unaudited statements, which shall
include a general ledger and a trial balance. Manager shall also provide at
the Company's request and expense any and all such additional statements or
reports as may be reasonably necessary to the Company's oversight and control
of the Business. The Company shall have control over and access, at all
reasonable times during normal business hours, to the books and records of
the Company maintained by Manager pursuant to this Section 8.
12
<PAGE>
Section 9. REGULATORY COMPLIANCE. Subject to the other provisions of
this Agreement, Manager shall cause the Company and its Subsidiaries, and
their respective Cellular Systems, to remain in compliance in all material
respects with applicable laws, rules and regulations, including rules and
regulations promulgated by the FAA and the FCC. Without limiting the
generality of the foregoing, the parties agree to comply with all applicable
FCC rules and regulations governing the Cellular Systems and the Licenses,
and specifically agree as follows:
(a) The Company (or its Subsidiaries which are the holders
of the Licenses) shall at all times maintain absolute control over, and
retain the ability to exercise the unfettered use of, the Licenses and the
licensed facilities provided thereunder, including the products and services
to be offered and the rates to be charged and the further right to terminate
service should public interest obligations under the applicable Licenses so
require.
(b) Manager shall not represent itself as the holder of a
License to provide the Company Communications Services on any of the Cellular
Systems of the Company.
(c) Each customer (if any) billed by Manager shall be
clearly advised that service is provided over facilities licensed to the
Company (or the Subsidiary which is the holder of a License).
(d) Neither Manager nor the Company (or a Subsidiary which
is a holder of a License) shall represent itself as the legal representative
of the other before the FCC. Manager and the Company (and each Subsidiary
which is the holder of a License) will cooperate with the other with respect
to FCC matters concerning the Cellular Systems.
(e) The Company (and each Subsidiary which is the holder of
a License) shall (i) in cooperation with Manager, take all actions necessary
to keep its Licenses in force and shall prepare and submit to the FCC, or any
other relevant authority, all reports, applications, renewals, filings or
other documents necessary to keep its Licenses in force and in good standing;
(ii) with all due assistance which may be necessary from Manager, respond
promptly to all FCC correspondence or inquiries and will immediately notify
Manager of the receipt thereof; and (iii) promptly report any changes of its
address to the FCC and to Manager.
(f) The Company (and each Subsidiary which is the holder of
a License) and Manager are familiar with the rules of the FCC regarding the
responsibility of the holder of a License under the Communications Act and
applicable FCC rules, regulations and policies. Nothing in this Agreement is
intended to diminish or restrict the obligations of the Company (or a
Subsidiary which is the holder of a License) as an FCC licensee and both
parties desire that this Agreement be in compliance with the rules and
regulations of the FCC. If the FCC determines that any provision of this
Agreement
13
<PAGE>
violates any FCC rule, policy or regulation, all parties will make good faith
efforts to immediately correct the problem and bring this Agreement into
compliance, consistent with the intent of this Agreement.
Section 10. DISPUTE RESOLUTION. If a dispute arises out of or
relating to this Agreement or the transactions contemplated hereby, or the
construction, interpretation, performance, breach, termination,
enforceability or validity hereof, whether such claim is based on rights,
privileges or interests recognized by or based upon contract, tort, fraud,
misrepresentation, statute, common law or any other legal or equitable
theory, and whether such claim existed prior to or arises on or after the
Effective Date, the dispute resolution processes set forth in Section 8.11 of
the LLC Agreement shall govern the resolution of such dispute.
Section 11. INSPECTION RIGHTS; DELIVERY OF INFORMATION.
(a) COMPANY'S RIGHT TO INSPECT. Manager will permit
representatives of the Company or any Qualified Member Group, at the
Company's or such Group's cost, during normal business hours and upon not
less than five business days' advanced written request, to (i) visit and
inspect during normal business hours Manager's properties and facilities
which are utilized in connection with Manager's provision of services to the
Company pursuant to this Agreement, including without limitation access to,
and the right to make copies of, books and records of the Company located at
such properties and facilities, and (ii) discuss with Manager's officers and
employees such properties and facilities and Manager's provision of services
to the Company pursuant to this Agreement. All such information shall be held
in confidence by the Company or such Group, except for disclosures made to
the Company's or Group's advisors, lenders and investors, or as required to
be disclosed by process of law or other applicable law.
(b) NOTICE OF CERTAIN EVENTS. Promptly, and in any event
within five (5) business days after Manager has received notice or has
otherwise become aware thereof, Manager shall give the Company notice of (i)
the commencement of any material proceeding or investigation against the
Company or Manager by or before any governmental body or in any court or
before any arbitrator which would be likely to have a material adverse effect
on Manager, the Business or the Company, or on Manager's ability to perform
its obligations hereunder, and (ii) the occurrence or non-occurrence of any
event (x) which constitutes, or which with the passage of time or giving of
notice or both would constitute, a default by the Company or Manager under
this Agreement or under any other material agreement to which the Company or
Manager is a party or by which its properties may be bound, and (y) would be
likely to have a material adverse effect on Manager, the Business or the
Company, or on Manager's ability to perform its obligations hereunder, giving
in each case the details thereof and specifying the action being taken or
proposed to be taken with respect thereto. Promptly upon receipt thereof,
Manager shall deliver to the Company copies of any material notice or report
regarding any License from the grantor of such license or from any
Governmental Authority regarding the Business or the Company.
14
<PAGE>
(c) OTHER INFORMATION. From time to time and promptly upon
each request, Manager shall provide the Company with such data, certificates,
reports, statements, financial projections, documents or further information
regarding the business, equity owners, assets, liabilities, financial
position or results of operations of Manager, as may be reasonably requested
by the Company.
Section 12. MISCELLANEOUS.
(a) COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but
all of which together shall constitute one instrument.
(b) CONSTRUCTION. Each of the parties hereto acknowledge
that it has reviewed this Agreement and that the normal rule of construction
to the effect that any ambiguities are to be resolved against the drafting
party shall not be employed in the interpretation of this Agreement or any
amendments thereto. The captions used herein are for convenience of reference
only and shall not affect the interpretation or construction hereof. All
pronouns and any variations thereof shall be deemed to refer to the
masculine, feminine, neuter, singular, plural as the context may require.
Unless otherwise specified, (i) the terms "hereof," "herein," and similar
terms refer to this Agreement as a whole, (ii) references herein to Articles
or Sections refer to articles or sections of this Agreement and (iii) the
word "including" connotes the words "including without limitation unless the
context requires otherwise.
(c) BENEFIT; ASSIGNMENT. This Agreement shall be binding
upon and inure to the benefit of all parties hereto and their respective
successors and permitted assigns; PROVIDED, however, that Manager shall not
assign or otherwise transfer its rights and obligations under this Agreement
(other than to another wholly owned subsidiary of DCC that has substantially
the same ability to perform its obligations hereunder as the original
Manager) without the prior written consent of the Company (acting through the
Management Committee excluding the Representatives appointed by DCC). The
parties agree that, upon any termination of this Agreement by the Company
pursuant to Section 5(b)(i) or Section 5(b)(ii), the rights and (to the
extent provided herein) obligations of Manager shall be deemed to have been
assigned to the New Provider; PROVIDED, that no such termination shall
relieve Manager of any liability which at the time of termination had already
accrued to Manager or which thereafter may accrue in respect of any act or
omission of Manager or its Affiliates prior to such termination.
(d) COMPLETE AGREEMENT. This document, the exhibits
attached hereto and each of the documents referred to herein, embody the
complete agreement and understanding among the parties relating to the
subject matter hereof and supersede and preempt any prior understandings
(written or oral) relating to such subject matter, including the letter
agreement and term sheet attached thereto dated October 5, 1999 among AT&T
Wireless Services, Inc., DCC and Dobson CC Limited Partnership.
15
<PAGE>
(e) AMENDMENT. This Agreement may not be amended except by
a writing signed by each of the parties.
(f) GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws, and not the laws of conflict,
of the State of New York.
(g) SEVERABILITY. If any provision of this Agreement or the
application thereof to any person or circumstance shall for any reason or to
any extent be invalid or unenforceable, the remainder of this Agreement and
the application of such provision to other persons or circumstances shall not
be affected thereby, but, rather, shall be enforced to the extent permitted
by law, so long as the economic and legal substance of this Agreement and the
actions contemplated hereby is not affected in any manner adverse to either
party.
(h) FURTHER ASSURANCES. The parties agree that they will
take all such further actions and execute and deliver all such further
instruments and documents as may be required in order to effectuate the
agreements set forth in this Agreement.
(i) WAIVER. No failure or delay on the part of the parties
or any of them in exercising any right, power or privilege hereunder, nor any
course of dealing among the parties or any of them shall operate as a waiver
of any such right, power or privilege nor shall any single or partial
exercise of any such right, power or privilege preclude the simultaneous or
later exercise of any other right, power or privilege. The rights and
remedies herein expressly provided are cumulative and are not exclusive of
any rights or remedies which the parties or any of them would otherwise have.
(j) NOTICES. All notices or other communications hereunder
shall be in writing and shall be deemed to have been duly given or made (i)
upon delivery if delivered personally (by courier service or otherwise) or
(ii) upon confirmation of dispatch if sent by facsimile transmission (which
confirmation shall be sufficient if shown on the journal produced by the
facsimile machine used for such transmission), and all legal process with
regard hereto shall be validly served when served in accordance with
applicable law, in each case to the applicable addresses set forth below (or
such other address as the recipient may specify in accordance with this
Section):
If to Manager:
Dobson Cellular Systems, Inc.
c/o Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attention: General Counsel
Fax: (405) 529-8765
16
<PAGE>
If to the Company:
ACC Acquisition LLC
c/o Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attention: General Counsel
Fax: (405) 529-8765
with copies to:
Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attention: General Counsel
Facsimile: (405) 529-8765
and
AT&T Wireless Services, Inc.
7277 164th Avenue, NE
Redmond, WA 98052
Attention: Mary Hawkins-Key
Facsimile: (425) 580-8075
* * *
[SIGNATURE PAGE FOLLOWS]
17
<PAGE>
IN WITNESS WHEREOF, the parties have set their hands effective as of
the date first written above.
COMPANY:
ACC ACQUISITION LLC
By: AT&T Wireless Services JV Co.
By: /s/ Don Adams
-----------------------------------
Name: Don Adams
Title: Vice President
By: Dobson JV Company
By: /s/ Bruce R. Knooihuizen
-----------------------------------
Name: Bruce R. Knooihuizen
Title: V.P. and Chief Financial Officer
MANAGER:
DOBSON CELLULAR SYSTEMS, INC.
By: /s/ Bruce R. Knooihuizen
-----------------------------------
Name: Bruce R. Knooihuizen
Title: V.P. and Chief Financial Officer
<PAGE>
AMENDED AND RESTATED OPERATING AGREEMENT
THIS AMENDED AND RESTATED OPERATING AGREEMENT (the "Agreement") is
dated as of the 25th day of February, 2000 by and between AT&T Wireless
Services, Inc., on behalf of itself and its Affiliates listed in Schedule 1
hereto (individually and collectively, "AWS") and ACC Acquisition LLC, on behalf
of itself and its Affiliates listed in Schedule 2 hereto (individually and
collectively, "ACC"). AWS and ACC are sometimes referred to, individually, as a
"Party" and together as "Parties."
R E C I T A L
WHEREAS, each of AWS and ACC desires to make arrangements to facilitate
the provision of voice and voice-related mobile wireless radiotelephone service
to its Customers through the wireless radiotelephone facilities of the other
Party in a manner providing a common look and feel and the appearance of
seamlessness between the Parties' facilities, in accordance with the terms of
this Agreement; and
WHEREAS, the parties hereto entered into an Operating Agreement, dated
as of January 31, 2000 (the "Original Agreement");
NOW, THEREFORE, in consideration of the premises and the mutual
promises herein set forth and intending to be legally bound hereby, the Parties
agree, and the Original Agreement is hereby amended and restated in its
entirety, as follows:
ARTICLE I.
DEFINITIONS
As used in this Agreement, the terms below shall have the following
meanings:
ACC has the meaning set forth in the first paragraph of this Agreement.
ACC SERVICE AREA means the geographic area in which ACC and those of
its Affiliates now or hereafter listed on Schedule 2 provide Service.
ACC SYSTEM means the facilities owned and/or operated by ACC with which
it provides Service anywhere within the ACC Service Area.
ACC TDMA SYSTEM means that portion of the ACC System located in the
markets listed on Exhibit A.
ADDITIONAL FEATURES means the Features that are offered by AWS to their
Customers in their Home Service Areas and are adopted by ACC pursuant to Section
10.3.3. Once
<PAGE>
implemented, an Additional Feature shall be deemed a Core Feature for
purposes of this Agreement.
ADOPTED FEATURES means the Core Features, the Future Core Features and
the Additional Features.
AFFILIATE means, with respect to a Party, any facilities-based CMRS
operating company that (a) is controlled by or under common control with the
Party, (b) is an entity in which the Party has at least fifty percent (50%)
voting interest, (c) shares switching facilities with the Party, (d) is managed
by the Party, or (e) is providing Service utilizing CMRS spectrum it has
acquired from a Party; provided, that AWS and Dobson Communications Corporation
and their respective Affiliates shall be deemed not to be Affiliates of ACC for
purposes of this Agreement.
APPROVED CIBERNET NEGATIVE FILE GUIDELINES means the negative file
guidelines appearing in the CIBER Record in effect from time to time.
AT&T WIRELESS means AT&T Wireless Services, Inc., individually.
AUTHORIZED RECEIPT POINT or ARP means the location or address of the
Party designated by the Home Carrier as the delivery point for its CIBER records
and authorized agent for performing CIBER edits.
AUTHORIZED ROAMER means a Roamer using equipment and an assigned
telephone number with the NPA/NXX combinations listed in accordance with Article
VI below for whom the Serving Carrier has not received a negative notification
in accordance with the provisions of this Agreement.
AWS has the meaning set forth in the first paragraph of this Agreement.
AWS SYSTEM means the facilities owned and/or operated by AWS with which
it provides Service anywhere within the United States.
BTA means a geographic area designated by the FCC as a Basic Trading
Area in which a PCS System may be operated, as described more specifically in 47
CFR 24.202 of the FCC rules and regulations.
CELLULAR SYSTEM means a wireless communication system that is operated
pursuant to authority granted by the FCC under 47 CFR Part 22.
CIBER means Cellular Intercarrier Billing Exchange Record.
CIBER RECORD means the publication prepared by CIBERNET Corporation, a
wholly-owned subsidiary of the Cellular Telecommunications Industry Association,
as a service to the wireless communications industry. Unless specifically
provided otherwise in this Agreement, all words and phrases defined in the CIBER
Record shall have the meaning herein that they have therein.
2
<PAGE>
CLEARINGHOUSE means that entity which provides for the exchange of
CIBER records and performs industry accepted CIBER edits, including edits to
verify Industry Negative File information.
CMRS means any Commercial Mobile Radio Service as authorized by the
FCC.
CORE FEATURES means the Features that, as of the Effective Date, AWS
and ACC have agreed to implement and maintain in order to create a common look
and feel and seamless subscriber service between the AWS System and the ACC
System, as evidenced by their listing in Schedule E-1 to Exhibit E attached
hereto.
CUSTOMER means an end-user of Service with which a Party has entered
into an agreement to provide such Service, regardless of whether such Service is
to be provided through the facilities of such Party.
DEFAULT has the meaning set forth in Section 13.1.
EFFECTIVE DATE means the Closing Date under the Agreement and Plan of
Merger dated as of October 5, 1999 among ACC Acquisition LLC, ACC Acquisition
Co. and American Cellular Corporation.
ESN means the Electronic Serial Number that is encoded in a wireless
telephone set by the manufacturer and which is broadcast by such telephone.
EQUIPMENT means phones, handsets, transmitters, terminals, control
equipment and switches and other hardware and software required or useful to use
Service, including phones and handsets Customers use in connection with Service.
FCC means the Federal Communications Commission and any successor
agency or authority.
FEATURES means voice and voice-related features and services available
from a Party through its mobile wireless telecommunication system.
FUTURE CORE FEATURES means the Features that are agreed upon as of the
date hereof (as evidenced by their listing on Schedule E-2 to Exhibit E attached
hereto) or in the future by the Parties pursuant to Section 10.3.2 as necessary
to maintain a common look and feel, and seamless subscriber service, between the
AWS System and the ACC System, and which the Parties agree will be supported by
both of their Systems, on the terms and conditions of this Agreement, in the
same manner as the Core Features. Once implemented, a Future Core Feature shall
be deemed a Core Feature for purposes of this Agreement.
GENERAL AVAILABILITY means the date upon which the technology and
products that comprise any Future Core Features are commercially available at a
commercially reasonable price from the vendors of such technology and
product(s), and such Feature has successfully
3
<PAGE>
completed and passed the first application in the System of the Party seeking
to implement such features and is ready for live commercial deployment.
HOME CARRIER means a Party who is providing Service to its registered
Customers (it being understood that for purposes of this Agreement AWS shall be
deemed to be the Home Carrier for its registered Customers residing in the ACC
Service Area).
HOME SERVICE AREA means the geographic area in which a Home Carrier is
licensed to provide Service.
INDUSTRY NEGATIVE FILE means the negative file maintained by the
authorized Clearinghouses in accordance with approved CIBERNET Negative File
Guidelines.
MIN means the "Mobile Identification Number" which is assigned by a
Home Carrier to each of its registered Customers.
MSA means a geographic area designated by the FCC as a Metropolitan
Service Area in which a Cellular System may be operated, as described more
specifically in 47 CFR 22.909 of the FCC rules and regulations.
MTA means a geographic area designated by the FCC as a Major Trading
Area in which a PCS System may be operated, as described more specifically in 47
CFR 24.202 of the FCC rules and regulations.
NPA/NXX COMBINATIONS means the six-digit numerical combinations
assigned by regulatory authorities to identify the area code and telephone
number prefix for Service.
PCS SYSTEM means a wireless communication system that is operated
pursuant to authority granted by the FCC under 47 CFR Part 24.
PARTIES and PARTY have the meanings set forth in the first paragraph of
this Agreement.
ROAMER means a Customer of one Party who seeks Service from the other
Party within the geographic area served by the other Party, regardless of
whether Service also is offered in that area by the Party whose Customer is
seeking Service.
RSA means a geographic area designated by the FCC as a Rural Service
Area in which a Cellular System may be operated, as described more specifically
in 47 CFR 22.909 of the FCC rules and regulations.
SERVICE means telecommunications service for the transmission and
reception of voice and voice-related features provided by means of radio
frequencies that are or may be licensed, permitted or authorized now or in the
future by the FCC for use by a Cellular System or a PCS System, and in respect
of which service the user equipment is capable of and intended for usage during
routine movement, including halts at unspecified points, at more than one
location throughout a wide area public or private wireless network. Unless
otherwise specifically agreed by the Parties, Service shall include personal
base station services but, by way of example and
4
<PAGE>
without limitation, does not include fixed wireless services, two-way
messaging wireless services (NBPCS), video broadcasting wireless services,
television services (whether cable, broadcast or direct broadcast satellite),
broadcast radio services, interactive informational or transactional content
services such as on-line content network services, Internet based services,
satellite based communications services, and air to ground communications
services.
SERVING CARRIER means a Party who provides Service for registered
Customers of another Party while such Customers are in the geographic area where
the Serving Carrier, directly or through subsidiaries, provides Service.
SYSTEM means the AWS System or the ACC System, and SYSTEMS means the
AWS System and the ACC System.
TDMA means the present and future North American Time Division Multiple
Access standard which is set by the Telecommunications Industry Association
(which at the Effective Date is IS-136), which is the essential radio frequency
technical method for digital wireless telephone operations upon which the
Service and equipment related thereto are designed to operate.
USER INTERFACE means the process, functional commands, and look and
feel by which a Customer operates and utilizes the Adopted Features, including
the sequence and detail of specific commands or service codes, the detailed
operation and response of Equipment to the sequence of keys pressed to effect
subscriber Equipment functions, and the response of subscriber Equipment to the
activation of these keys, or in response to signals or data from either the ACC
System or the AWS System. Furthermore and for greater certainty, such definition
shall include without limitation, the manner in which information is displayed
on the screen of a phone used for Adopted Features, announcement tones or
messages occur, and service or feature codes that must be dialed. The origins of
the information presented to the user may be the user Equipment, or the AWS
System or the ACC System, or both.
ARTICLE II.
PROVISION OF SERVICE
2.1 Each Party shall provide, to any Authorized Roamer who so
requests, in accordance with its own ordinary requirements, restrictions,
practices, and tariffs, if applicable, and with the terms and conditions of
this Agreement, any and all types of Service that such Party provides to its
own Customers within its Service Area. At a minimum, such Service shall
include voice communications capability, as well as any other types of
Service required by this Agreement, including without limitation Article X
hereof.
2.2 Notwithstanding anything in this Agreement to the contrary, a
Serving Carrier may suspend or terminate Service to an Authorized Roamer in
accordance with the terms of its own ordinary requirements, restrictions,
practices, and tariffs, if any, but such suspension or
5
<PAGE>
termination shall not affect the rights and obligations of the Parties for
Service furnished hereunder prior to such termination or suspension.
2.3 In connection with its Service to Roamers, no Serving Carrier
shall use recorded announcements or other inducements for an Authorized
Roamer to discontinue the Service of its Home Carrier or, unless otherwise
authorized herein, Roamer's use of a Serving Carrier's system.
2.4 In the event that an operating entity becomes an Affiliate of
a Party after the date of this Agreement, such Party may, upon thirty (30)
days prior written notice to the other Party, add such operating entity to
Schedule 1 or Schedule 2, as the case may be, at the expiration of which
thirty-day period, in which event (a) the Customers of such entity shall be
entitled to Service as Roamers from the other Party on the terms and
conditions of this Agreement and (b) such operating entity shall provide
Service to Customers of the other Party who are Authorized Roamers, although
the other Party is not obligated to request such Service or to require its
Customers to request such Service. Notwithstanding the foregoing, the other
Party, in its reasonable discretion, may specify, by delivering written
notice thereof prior to the expiration of the thirty day period, that any
Affiliate so added shall not be entitled to preference as a Serving Carrier
as otherwise provided in Section 2.5. Upon the addition to or deletion from
Schedule 1 or 2 of any operating entity pursuant to this Section 2.4,
Exhibits A and B shall automatically be revised accordingly, except that
either Party may, in its sole discretion, specify that an addition by either
Party to Schedule 1 or 2 shall not be given effect for any or all purposes of
Section 2.5.
2.5
2.5.1 AWS, in its capacity as Home Carrier, shall cause
substantially all of its Customers, when roaming in the markets operated by ACC
that are listed on Exhibit A, to normally seek Service as Roamers from ACC prior
to seeking Service from any other carrier. ACC, in its capacity as Home Carrier,
shall cause substantially all of its Customers, when roaming in the markets
operated by AWS that are listed on Exhibit B, to normally seek Service as
Roamers from AWS prior to seeking Service from any other carrier.
2.5.2 As a condition to the right of a Party under Section
2.5.1 to be the preferred provider of Service to Customers of the other Party,
the market being served by the Serving Carrier shall (i) have fully installed a
TDMA-based system, including all Core Features, (ii) be fully interoperable in
accordance with Sections 10.6, 10.7, and 10.8, and (iii) otherwise have met, and
be in compliance with, all terms and conditions of this Agreement.
2.6 ACC shall join and remain a member of the North American Cellular
Network throughout the term of this Agreement.
2.7 Notwithstanding anything in this Agreement to the contrary, ACC
acknowledges that AWS has the right to market, offer and sell, to Customers
residing in the ACC Service Area, AT&T branded or co-branded telecommunications
services that are offered nationally, including providing local numbers and
service to such Customers, subject to the provisions of Section 2.5.1, Article V
and the other provisions of this Agreement.
6
<PAGE>
ARTICLE III.
RELATED SERVICES
3.1 Upon request by ACC, AWS and ACC shall consider implementing a
common System Identification Number (SID) for markets operated by the respective
Parties in the same general vicinity or taking other steps to suppress the
roaming indicator on a Customer's handset from lighting to indicate that the
Customer is roaming in such markets, but each Party may, in its sole discretion,
decide whether to implement such measure.
3.2 So long as interexchange services are offered to ACC and those of
its Affiliates listed in Schedule 2 by AT&T Corp. or one of its Affiliates on
terms that are reasonably competitive with those available through other
sources, ACC and its Affiliates listed in Schedule 2 shall not market, offer,
provide, or resell interexchange services, except (i) such services offered by
AT&T Corp. or its Affiliate or (ii) services provided exclusively within a
single home service area designated as such by ACC in its marketing materials.
All relevant factors shall be considered in determining the competitiveness of
interexchange services, including rates, volume commitments, duration, and other
terms. At anytime when ACC believes that it can obtain such interexchange
services from another source(s) at better terms than those being offered to ACC
by AT&T Corp. or one of its Affiliates, ACC may solicit competing offers. If
such offer is made which ACC believes is better, and the relevant rates are at
least 5% less than those charged to ACC by AT&T Corp. or one of it's Affiliates,
ACC shall provide AWS with a written term sheet which specifies the relevant
rates, volume commitments, duration and other material terms of the competing
offer ("Offer Notice"). AT&T Corp. or one of its Affiliates shall have thirty
(30) days after receipt of the Offer Notice by AWS to offer to ACC the
comparable interexchange service(s) upon the same or better terms as specified
in the Offer Notice. If AT&T Corp. or one of its Affiliates make such an offer
to ACC, ACC agrees to contract with AT&T Corp. or one of its Affiliates for any
of such services acquired by ACC. If no such offer is made by AT&T Corp. or one
of its Affiliates within the required time period, then ACC may accept the
competing offer. Any claim or dispute over the interpretation or implementation
of this paragraph shall be resolved under the provisions of paragraph 13.2 of
this Agreement.
3.3 AWS and ACC agree that ACC shall participate in AWS's National
Account Program ("NAP") on substantially the terms of AWS's standard NAP
agreement, a copy of which has been provided to ACC. Promptly following the
execution of this Agreement, AWS and ACC shall negotiate in good faith the final
terms of such agreement, with the goal of executing the agreement by May 1,
2000.
3.4 Each Party, within the geographic areas in which such Party
provides Service, will provide Service without any additional toll charge
throughout an area (a so-called "home calling area") that is of a size at least
reasonably comparable to the area within which toll-free calls placed through
facilities that are exclusively land-based are available.
7
<PAGE>
ARTICLE IV.
CUSTOMER SERVICE
4.1 The Parties shall use commercially reasonable efforts to develop
and implement systems enabling each Party, as Serving Carrier, to route to a
Customer's Home Carrier any 611 customer service call received from a Customer
of the other Party while roaming on the Serving Carrier's System.
ARTICLE V.
CHARGES
Each Home Carrier, whose Customers (including the Customers of its
resellers) receive service from a Serving Carrier as Authorized Roamers under
this Agreement, shall pay to the Serving Carrier who provided such service 100%
of the Serving Carrier's charges for CMRS and one hundred percent (100%) of the
toll charges pursuant to Exhibit C. The amount of the charges for the use of
each Serving Carrier's Service are set forth in Exhibit C attached to this
Agreement.
ARTICLE VI.
EXCHANGE OF INFORMATION
6.1 The Parties shall furnish to each other, in the format of
Exhibit D to this Agreement, the valid NPA/NXX combinations used by their
respective Customers. These combinations shall be accepted by the other
Party. Each NPA/NXX combination is and shall be within the entire line range
(0000-9999), or a specified portion thereof. The minimum line range to be
exchanged by the Parties shall be 1,000 line numbers. Each Party shall be
responsible for all billings otherwise properly made under this Agreement to
any number listed by such Party within the range or ranges specified by it in
Exhibit D. Additions, deletions, or changes to NPA/NXX combinations and line
number range(s) for the Home Carrier's Customers may be made upon at least
fifteen (15) days prior written notice to the Serving Carrier. Such notice
shall be in the form attached as Exhibit D to this Agreement and shall
include the requested effective date for the addition, deletion or change.
6.2 [Reserved]
6.3 Each Party hereby agrees to indemnify the other Party, together
with its partners and any and all of their officers, directors, employees,
agents and/or affiliates, against, and hold them harmless from, any and all
claims, suits, demands, losses and expenses, including reasonable attorneys'
fees and disbursements, which may result in any way whatsoever from the
indemnified Party's denial of Roamer or local Service to any NPA/NXX combination
which has been listed by the indemnifying Party as not being authorized to
receive Service; provided that (i)
8
<PAGE>
the person seeking indemnification (the "Indemnified Person") provides notice
of such claim promptly after its discovery to the Party from which
indemnification is sought (the "Indemnifying Person") and in any event the
Indemnifying Person will be released from any obligation hereunder to the
extent it is prejudiced by any delay in the delivery of such notice, (ii) the
Indemnifying Person shall have the right to assume the defense of such claim,
(iii) the Indemnified Person shall provide such reasonable assistance and
cooperation in the defense of such claim as is requested by the Indemnifying
Person, and (iv) the Indemnified Person shall not settle or compromise any
such claim without the prior written consent of the Indemnifying Person.
6.4 [Reserved]
6.5 Upon the implementation of wireless number portability in any
portion of either the AWS System or the ACC System, the Parties shall cooperate
in establishing an alternative method for exchanging ESN and/or NPA/NXX
information required to permit roaming by the other Party's Customers in their
respective systems.
ARTICLE VII.
FRAUD
7.1 The Parties will cooperate and, as necessary, supplement this
Agreement in order to minimize fraudulent or other unauthorized use of their
systems. If any Party reasonably decides that, in its sole judgment, despite due
diligence and cooperation pursuant to the preceding sentence, fraudulent or
other unauthorized use has reached an unacceptable level of financial loss and
is not readily remediable, such Party may suspend the use of applicable NPA/NXX
combinations, in whole or in part, pursuant to the terms of this Agreement.
7.2 Each Party shall take reasonable actions to control fraudulent
Roamer usage, including without limitation using either (i) a positive
validation/verification ("PV") system provided by a mutually agreed upon
validation/verification service under which the ESN and/or NPA/NXX used in a
call in the Serving Carrier's system is compared against a list of Authorized
Roamers or (ii) SS-7 connections through a network of carriers. The Parties
shall work together in good faith to designate and implement a system as
specified in the preceding sentence and enhancements thereto or alternative
systems as they shall agree in the future. The Home Carrier shall have no
responsibility or liability for calls completed by a Serving Carrier without
obtaining positive validation/verification as required herein.
7.3 In addition to other procedures set forth in this Agreement, a
Home Carrier may notify a Serving Carrier by facsimile, with written
confirmation, that certain NPA/NXX combinations are not to receive Service.
Any calls completed using such NPA/NXX combinations made one full business
day or more after such notice has been given shall be the sole responsibility
of the Serving Carrier, and the Home Carrier shall not be charged any amount
for such calls.
9
<PAGE>
7.4 Each Serving Carrier shall use commercially reasonable efforts
to provide each Home Carrier with real-time visibility of call detail records
delivered through a network compatible with AWS's network. Such information
shall be delivered within one hour of the applicable call. In the event that the
Serving Carrier provides such a real-time visibility system, the Serving Carrier
shall not be liable in any event for a temporary failure of the system unless
the Serving Carrier has been notified of such failure by the Home Carrier and
the Serving Carrier does not take commercially reasonable steps to remedy the
failure. If the Serving Carrier has been so notified and has failed to take such
commercially reasonable steps, the Serving Carrier shall be liable for all
unauthorized usage attributed to Home Carrier's subscribers during the period
from the time Serving Carrier was notified of the problem to the time that the
problem has been resolved to the reasonable satisfaction of the Home Carrier.
7.5 For purposes of notification under this Article VII, the
following addresses and facsimile numbers shall be used:
If to AWS: AT&T Wireless Services, Inc.
P.O. Box 97061
Redmond, WA 98073-9761
Attn: Billing and ICS Operations
Tel. No. 425-580-6000
Fax No. 425-580-8390
If to ACC: ACC Acquisition LLC
c/o Dobson JV Company
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: G. Edward Evans, President
Tel. No. (405) 529-8500
Fax No. (405) 529-8515
Each Party may change the names, addresses and numbers set forth above
by providing notice to the other Party as provided in Article XVI below.
ARTICLE VIII.
BILLING
8.1 Each Home Carrier shall be responsible for billing to, and
collecting from, its own Customers all charges that are incurred by such
Customers as a result of service provided to them as Authorized Roamers by the
Serving Carrier. The Home Carrier shall also be responsible for billing its
Customers for, and remitting to, the Federal Government all federal excise tax
that may be due in connection with the service being billed by it to its
Customers. While the Serving Carrier will be responsible for the computation and
remittance of all state and local taxes, each Home Carrier shall be liable to
the Serving Carrier for all such state and local taxes remitted by
10
<PAGE>
the Serving Carrier, for Authorized Roamers regardless of whether these
amounts are paid to the Home Carrier by its Customers.
8.2 Each Serving Carrier who provides Service to an Authorized Roamer
pursuant to this Agreement shall forward Roamer billing information, within five
business days of the call date, in accordance with the procedures and standards
set forth in the CIBER Record to the Home Carrier's Authorized Receipt Point.
CIBER Type 50 and CIBER Type 70 records shall not be accepted without mutual
signed agreement and if such mutual agreement is reached it will be attached to
this Agreement. Any future revisions of the CIBER Record or additional record
types must be mutually agreed upon before implementation. In the event the
parties use the CIBERNET Net Settlement Program, or alternative settlement
program such information must be in a format in compliance with the CIBER Record
requirements or agreed upon format.
8.3 Where the Authorized Roamer billing information required to be
provided by the Serving Carrier in accordance with Section 8.2 above is not in
accordance with the CIBER Record, the Home Carrier may return a record to the
Serving Carrier as provided in the CIBER Record. Returning the defective record
will be in accordance with CIBER Record established procedures. The Serving
Carrier may correct the defective record and return it to the Home Carrier for
billing, provided that the time period from the date of the Service call at
issue to the receipt of the corrected record does not exceed sixty (60) days.
8.4 No credit for insufficient data or defective records shall be
permitted except as provided in Section 8.3 above, unless mutually agreed upon
by both Parties.
8.5 Each Home Carrier may at its discretion perform any necessary
edits at its Clearinghouse on incollect or outcollect call records to ensure
compliance with the terms of this Agreement.
ARTICLE IX.
SETTLEMENT
9.1 Each Party will settle its accounts with the other Parties on the
basis of billing information received as described in this Article IX. In the
event both Parties use a net financial settlement procedure, the Parties shall
not submit a paper invoice but will make payments in accordance with such net
financial settlement procedures provided that the Parties may submit call
records for payment that relate to calls made more than sixty (60) days from the
date of the call if such call was the subject of a dispute or investigation
regarding fraudulent or unauthorized use.
9.2 If an incorrect roaming rate is charged by the Serving Carrier to
the Home Carrier, the Serving Carrier shall refund all amounts in excess of the
contract rate back to the Home Carrier within forty five days of notification by
the Home Carrier. Each carrier shall have ninety (90) days from the end of the
settlement period to invoice for amounts in excess of the contract rate. The
Home Carrier will send a collection letter within sixty (60) days of the invoice
date,
11
<PAGE>
within ninety (90) days of the invoice date, and within one hundred (120)
days of the invoice date. If the invoice remains unpaid after one hundred
twenty (120) days from the original invoice date, the Home Carrier may
withhold the amounts from the CIBERNET Net Settlement Program or alternative
settlement program.
9.3 In the event that either Party does not use a net financial
settlement procedure, the billing and payment for charges incurred under this
Agreement shall be as set forth below.
9.3.1 The parties shall determine amounts owed to each other
for Service provided to Roamers in one-month periods with such period beginning
on the sixteenth day of each calendar month and ending on the fifteenth day of
the following month in which Service is provided. The end of this Period shall
be referred to as "Close of Billing."
9.3.2 The Parties shall send each other an invoice for
Services used under this Agreement within fifteen (15) days after the Close of
Billing.
9.3.3 Each invoice shall contain the following information.
a. Billing period used by Serving Carrier
b. Batch sequence number
c. Serving and Home Carrier System Identification Number
d. Air Service charges
e. Total toll charges (both intrastate and interstate)
f. All other charges and credits
g. Total taxes
h. Total charges
9.3.4 Payment on such invoices shall be made in the form of a
check or a wire transfer which must be received by the invoicing party within
thirty (30) days from the date of the invoice. Late payments shall be charged
with a late payment fee of one and one half percent (1.5%) of the outstanding
balance for each thirty-day period (or portion thereof) that such payments are
late.
9.3.5 Each Party may offset the amount owed to the other Party
under this Agreement and a single payment of the balance to the Party entitled
to receive such balance shall be made.
9.4 If the Serving Carrier provides pre-call validation of the Home
Carrier's Customers, the Home Carrier agrees to implement Negative File
Suppression at the Clearinghouse and the CIBERNET Negative File Guidelines and
procedures do not apply.
12
<PAGE>
ARTICLE X.
INTEROPERABILITY
10.1 The Parties agree that their respective obligations under this
Agreement related to the interoperability of the AWS System and the ACC TDMA
System shall be construed in accordance with the following general principles:
10.1.1 The Parties agree, confirm and acknowledge that one of
their primary objectives in entering into this Agreement is to promote the
establishment and operation throughout the United States of a mobile wireless
service that is TDMA-based and that will appear to their respective subscribers
as a single mobile wireless network with a common User Interface pertaining to
the Adopted Features, and that they intend to achieve such purpose and objective
as set forth in, and subject to the terms and conditions of, this Agreement.
Adopted Features shall be made available to all Customers of a Party when
roaming in the AWS System or the ACC TDMA System, subject to the terms of this
Agreement. Each Party shall use good faith efforts, when implementing any
software or other System change or upgrade, to confirm the continued
availability of the Feature interoperability provided for herein, and in the
event of any interference with any Feature interoperability shall work
expeditiously to restore required functionality. Without limiting the generality
of the foregoing, in the event the Authentication Fraud Protection Feature (or
any subsequent or comparable fraud protection Feature) is disabled or affected
by any network change so as to interfere with its interoperability, the Party
responsible for such network shall restore interoperability within 48 hours of
notification from the affected Party.
10.1.2 The Parties agree that each of their respective
obligations, duties, rights and entitlements pursuant to this Agreement shall be
interpreted, to the extent such interpretation is required to resolve any
dispute or uncertainty concerning this Agreement, in a manner that is reasonably
consistent with, and which reasonably supports, the purpose and objective of
this Agreement as set out in Section 10.1.1.
10.1.3 The Parties agree that they each shall, in good faith,
work together, cooperate, and use the rights that they each have granted the
other under this Agreement for the purposes set out in Section 10.1.1 and on the
terms and conditions of this Agreement.
10.1.4 Any entity listed on Schedule 1 but in which AT&T
Wireless owns, directly or indirectly, less than a majority interest or which
AT&T Wireless otherwise does not control shall, at the option of AT&T Wireless,
not be subject to the requirements of this Article X.
10.2 The Parties agree to implement TDMA-based systems as follows:
10.2.1 The Parties each acknowledge and confirm that their
digital standard for, in the case of AWS, the AWS System and, in the case of
ACC, the ACC TDMA System, is currently (as of the Effective Date) TDMA. In
addition, ACC shall maintain its commitment to TDMA as ACC's digital standard
for the ACC TDMA System on Exhibit A for so long as, and to
13
<PAGE>
the extent that, AWS maintains its commitment to TDMA as AWS's digital
standard. AWS agrees that in the event it may exercise its discretion to no
longer remain committed to TDMA as its digital standard, it shall inform ACC
of that decision by no later than six months prior to the implementation of
any non-compatible interface. Upon the implementation of any such
non-compatible interface, the following Sections of this Agreement shall
immediately terminate: Sections 10.1.1, 10.2.2, and 10.2.3.
10.2.2 ACC shall deploy TDMA throughout the ACC TDMA System
within twelve (12) months after the date of this Agreement. ACC shall use
commercially reasonable efforts to promote the use of TDMA-based communications
devices among its Customers who roam on the AWS System.
10.3 Each of the Parties agrees that it shall operate and support its
TDMA-based System, to the extent installed, to ensure that the other Party's
Customers can use the Adopted Features when roaming on the Serving Carrier's
TDMA-based System in the same manner that such Customers use such Adopted
Features on the Home Carrier's TDMA-based System.
10.3.1 CORE FEATURES. Each Party shall, at its own expense,
implement the Core Features in the AWS System, in the case of AWS, and in the
ACC TDMA System, in the case of ACC, as soon as reasonably practicable and in
any event within one (1) year after the Effective Date. Thereafter, Core
Features shall be implemented at the time any TDMA-based system is placed into
operation.
10.3.2 FUTURE CORE FEATURES. The Future Core Features shall be
those features set forth on Schedule E-2 to Exhibit E attached hereto or that
are agreed upon by the Parties from time to time after the execution of this
Agreement. Each Party shall, at its own expense, implement such Future Core
Features within one (1) year after the General Availability of such Future Core
Features, provided that, and subject to such Party's determination, in its sole
and absolute discretion, that such implementation is both financially feasible
and economically viable, and consistent with such Party's objective of
maximizing its financial performance. In the event that a Party opts not to
adopt a Future Core Feature in accordance with this Section 10.3.1, it shall
promptly notify the other Party of that decision. Future Core Features shall be
implemented in accordance with this Section in the areas specified for each
respective Party in Section 10.3.1.
10.3.3 ADDITIONAL FEATURES. In addition to the Core Features
and the Future Core Features, ACC shall offer, at the request of AWS, additional
service features that AWS notifies ACC that AWS will provide in a majority of
its TDMA Systems, unless the Management Committee reasonably determines that
providing such additional features would be financially detrimental to ACC.
Absent such determination, any such additional features shall be adopted within
120 days (or such longer period as is reasonably necessary under the
circumstances) after the request by AWS. ACC agrees that in order to offer
certain Additional Features it will be obligated to implement technological
enhancements, upgrades, improvements and advances ("Improvements") that are
implemented by AWS from time to time (e.g., EDGE technology) and that are
technologically compatible with ACC's equipment. At the request of AWS, ACC will
14
<PAGE>
implement any Improvements that AWS notifies ACC that AWS will implement in a
majority of its TDMA Systems, unless the Management Committee reasonably
determines that the implementation of any such Improvement would be financially
detrimental to ACC. Absent such determination, any such improvements shall be
implemented within 120 days (or such longer period as is reasonably necessary
under the circumstances) after the request by AWS. A course of action will be
considered "financially detrimental" to ACC for purposes of this Section 10.3.3
if the reasonable business case for such course of action has a net present
value that is less than or equal to negative 10% of the capital cost of that
course of action.
10.3.4 The Parties shall use commercially reasonable efforts
to comply with the network performance standards with respect to the Adopted
Features that are set out in Schedule E-3 to Exhibit E attached hereto.
10.4 Neither Party shall provide the other Party's Customers with
Service inferior in quality to that provided to its own Customers. Each Party
shall provide Service to Customers of the other Party of a quality level, based
on criteria customarily used to evaluate the performance of wireless voice
systems, comparable to or exceeding industry norms. Any assessment of "quality"
shall be with reference to the System's performance as a whole within a specific
MSA, RSA, or BTA, as the case may be, and shall be over such a period of time as
reasonably necessary to yield an accurate depiction of System "quality" taking
into account all of the variables which may affect System performance.
10.5 In order to facilitate performance by each of the Parties of
their obligations under this Article X, the Parties agree to exchange and
share information with each other as follows, except that nothing contained
herein shall be construed to require a Party to exchange information that the
Party considers confidential or proprietary.
10.5.1 Subject to Article XVII of this Agreement, the Parties
shall provide each other, on a reasonably prompt basis, with all information and
materials that either has a right to disclose that is necessary to meet the
interoperability standards set forth in this Article X, including without
limitation the following information:
System Engineering:
- Minimum Standards for Systems
Features:
- Capability description of present Core Features and other
Features
- User Interface (codes)
- Implementation procedures
- Roaming requirements
- Feature functionality design documents
Research and Development:
15
<PAGE>
- operational test results
- operational defects and bugs
- remedial/back-up plans
- operational, functional and technical specifications
- all related documentation
- systems integration
10.5.2 Each Party agrees that it shall, in performing its
obligations to provide the other Party with information in accordance with
Section 10.5, act reasonably, and in good faith toward the other Party.
10.5.3 Nothing contained herein is intended or should be
construed to constitute the transfer or grant by one Party to the other of any
ownership, license, or other rights of or to any trade secret, know-how, or
other intellectual property by one Party to the other.
10.6 Each Party shall provide for automatic call delivery for
Customers of the other Party who are Roamers in such Party's system. To this
end, each Party shall continuously provide the hardware, software and
transmission facilities required for such call delivery either directly
between the systems of the Parties or indirectly through a separate network
of wireless communications carriers. The hardware, software and transmission
facilities provided by each Party hereunder shall at all times be operated
and maintained to provide the most efficient level of service that is
technically feasible and commercially reasonable to minimize transmission
errors and Service interruptions.
10.7 If the Parties have implemented linking facilities as
contemplated in Section 10.8, the Serving Carrier shall automatically
hand-off to the Home Carrier, and as requested shall automatically accept
hand-off from the Home Carrier in order to provide Service as specified in
Article II, calls to or from a Customer of the Home Carrier in accordance
with the hand-off procedures established for such linking facilities. To this
end, each Party shall continuously provide the hardware, software and
transmission facilities required for such call hand-off either directly
between the systems of such Home and Serving Carrier or indirectly through a
separate network of wireless communications carriers. The hardware, software
and transmission facilities provided by each Party hereunder shall at all
times be operated and maintained to provide the most efficient level of
service that is technically feasible and commercially reasonable to minimize
transmission errors and Service interruption.
10.8 The Parties will work together to evaluate the economic advantage
of various switch linking options to interconnect and facilitate networking of
the Parties' respective Systems as required by this Agreement. Should the
Parties agree to install and maintain linking facilities, the cost of the
linking facilities shall be allocated pursuant to the following provisions:
10.8.1 AWS and ACC will each pay one-half of the equipment
costs for the establishment of microwave facilities to link the Parties'
respective Systems for the purposes of
16
<PAGE>
automatic call delivery and automatic call hand-off. Each Party is solely
responsible for the costs of preparing its own facilities for the System link.
10.8.2 Equipment costs for the establishment of a landline
link (T-1) to link the Parties' respective Systems together for these
purposes shall be split between the Parties as follows:
(a) AWS and ACC shall each pay one-half of the
cost for the installation, use, modification, or discontinuance of the
linking facilities. Each party is solely responsible for all costs to prepare
its own facilities for the link between the Systems.
(b) For ease of administration, AWS will order and
be the customer of record ("COR") for such facilities. ACC will reimburse AWS
monthly for its share of the recurring costs of such facilities. The COR
shall be responsible for invoicing the other Party for its share of the
costs, with payment due within 30 days of receipt of the invoice.
10.8.3 The Parties agree that this Section 10.8 relates
only to those costs necessary to establish the referenced facilities. This
section is not applicable to the allocation of costs with respect to the
provision of service for each Party's Customers.
10.9 The Parties agree that the revenues and costs for a call belong
to the Party whose System operates the originating cell site (the "Bill and
Keep System").
ARTICLE XI.
REPRESENTATIONS AND WARRANTIES
11.1 AWS hereby represents and warrants to ACC that:
11.1.1 AT&T Wireless is a corporation duly organized,
validly existing, and in good standing under the laws of the State of
Delaware. AT&T Wireless has all requisite power and authority to execute and
deliver this Agreement and to cause this Agreement to be the binding
obligation, to the extent provided herein, of those of its Affiliates listed
on Schedule 1 or added to Schedule 1 hereafter in accordance with Section 2.4.
11.1.2 This Agreement is the legal, valid, and binding
obligation of AT&T Wireless, enforceable against AT&T Wireless in accordance
with its terms, except that such enforceability may be subject to (a)
bankruptcy, insolvency, reorganization, moratorium, or other similar laws now
or hereafter in effect relating to creditors' rights generally and (b)
equitable principles of law and the discretion of any court or arbitral body
before which any related proceeding may be brought.
11.1.3 The execution, delivery, and performance of this
Agreement by AT&T Wireless does not and will not conflict with or result in a
material default, suspension, or
17
<PAGE>
termination of any agreement, contract, obligation, license, or authorization
with or granted by any third party or governmental body.
11.2 ACC hereby represents and warrants to AWS that:
11.2.1 ACC is a limited liability company duly organized,
validly existing, and in good standing under the laws of the State of
Delaware. ACC has all requisite power and authority to execute and deliver
this Agreement and to cause this Agreement to be the binding obligation, to
the extent provided herein, of those of its Affiliates listed on Schedule 2
or added to Schedule 2 hereafter in accordance with Section 2.4.
11.2.2 This Agreement is the legal, valid, and binding
obligation of ACC, enforceable against ACC in accordance with its terms,
except that such enforceability may be subject to (a) bankruptcy, insolvency,
reorganization, moratorium, or other similar laws now or hereafter in effect
relating to creditors' rights generally and (b) equitable principles of law
and the discretion of any court or arbitral body before which any related
proceeding may be brought.
11.2.3 The execution, delivery, and performance of this
Agreement by ACC does not and will not conflict with or result in a material
default, suspension, or termination of any agreement, contract, obligation,
license, or authorization with or granted by any third party or governmental
body.
ARTICLE XII.
TERM, TERMINATION AND SUSPENSION OF AGREEMENT
12.1 This Agreement shall have a term commencing on the Effective
Date and continuing for a period of twenty (20) years; PROVIDED, that the
provisions of Section 2.5 shall terminate on the earlier of (i) the fifth
anniversary of the Effective Date and (ii) termination of the roaming
preference obligations of AWS under Section 8.2(a) of the LLC Agreement.
Thereafter, this Agreement shall continue in force on a month-to-month basis
unless either party terminates the Agreement by written notice to the other
party given at least 90 days prior to the date of termination. Otherwise,
this Agreement may be terminated or suspended only as provided in this
Article XII.
12.2 This Agreement may be terminated or suspended by either Party
immediately upon written notice to the other of a Default (as defined in
Section 13.1) by the other Party. In addition, either Party may suspend this
Agreement immediately upon written notice to the other Party pursuant to
Section 13.1.1 of the existence of a breach of this Agreement, whether or not
such breach constitutes a Default, which materially affects the Service being
provided to Customers of the non-breaching Party. While any suspension of
this Agreement, whether in part or in whole, is in effect, the obligations of
the Parties shall be only those that survive termination and to work together
to resolve as expeditiously as possible any difficulty that resulted in a
suspension. At such time as the Party originally giving notice of suspension
concludes that the problem causing the suspension has been resolved, that
Party shall give to the other written
18
<PAGE>
notice to this effect. This Agreement shall resume in full effect within five
(5) business days after the Parties have mutually agreed that the problem has
been resolved.
12.3 The Parties shall cooperate to limit the extent and effect of
any suspension of this Agreement to what is reasonably required to address
only the cause of such suspension.
12.4 In the event that a Party transfers control of an Affiliate
listed in Schedule 1 or Schedule 2, as the case may be, the Party shall
provide at least four months' prior written notice to the other Party and
upon such transfer such Affiliate shall be deleted from the appropriate
Schedule, but doing so will not relieve a Party of its obligations under
Section 14.1.
12.5 The termination or suspension of this Agreement shall not
affect the rights and liabilities of the Parties under this Agreement with
respect to all Authorized Roamer charges incurred prior to the effective date
of such termination or suspension.
ARTICLE XIII.
DEFAULT
13.1 A Party will be in "Default" under this Agreement upon the
occurrence of any of the following events:
13.1.1 Material breach of any material term of this
Agreement, if such breach shall continue for thirty (30) days after receipt
of written notice thereof from the nonbreaching Party;
13.1.2 Voluntary liquidation or dissolution or the approval
by the management, board of directors, stockholders, or owners of a Party of
any plan or arrangement for the voluntary liquidation or dissolution of the
Party;
13.1.3 A final order by the FCC revoking or denying renewal
of CMRS licenses or permits granted to such Party which, individually or in
the aggregate, are material to the business of such Party; or
13.1.4 Such Party (i) filing pursuant to a statute of the
United States or of any state, a petition for bankruptcy or insolvency or for
reorganization or for the appointment of a receiver or trustee for all or a
portion of such Party's property, (ii) has filed against it, pursuant to a
statute of the United States or of any state, a petition for bankruptcy or
insolvency or for reorganization or for the appointment of a receiver or
trustee for all or a portion of such Party's property, provided that within
120 days after the filing of any such petition such Party fails to obtain a
discharge thereof, or (iii) making an assignment for the benefit of creditors
or petitioning for, or voluntarily entering into, an arrangement of similar
nature, and provided that such filing, petition, or appointment is still
continuing.
19
<PAGE>
13.2 All claims and disputes relating in any way to the performance,
interpretation, validity, or breach of this Agreement, including but not
limited to a claim based on or arising from an alleged tort, shall be
resolved as provided in this Section 13.2. It is the intent of the Parties
that any disagreements be resolved amicably to the greatest extent possible.
13.2.1 If a disagreement cannot be resolved by the
representatives of the Parties with day-to-day responsibility for this
Agreement, such matter shall be referred to an executive officer of each of
the Parties. The executive officers shall conduct face-to-face negotiations
at a neutral location or such other location as shall be mutually agreed
upon. If these representatives are unable to resolve the dispute within ten
business days after either Party requests the involvement of the executive
officers, then either Party may, but is not required to, refer the matter to
mediation or arbitration, as applicable in accordance with Sections 13.2.2
and 13.2.3.
13.2.2 In any case where the amount claimed or at issue is
One Million Dollars ($1,000,000) or more and the Parties are unsuccessful in
resolving the disagreement, the Parties agree to submit the disagreement to
non-binding mediation upon written notification by either Party. The Parties
shall mutually select an independent mediator experienced in
telecommunications system disputes. The specific format for the mediation
shall be left to the discretion of the mediator. If mediation does not result
in resolution of the disagreement within thirty days of the initial request
for mediation, then either Party may, but is not required to, refer the
matter to arbitration.
13.2.3 Any disagreement not finally resolved in accordance
with the foregoing provisions of this Section 13.2 shall, upon written notice
by either Party to the other, be resolved by final and binding arbitration.
Subject to this Section 13.2.3, such arbitration shall be conducted through,
and in accordance with the rules of, JAMS/Endispute. A single neutral
arbitrator shall decide all disputes. Each Party shall bear its own expenses
with respect to the arbitration, except that the costs of arbitration
proceeding itself, including the fees and expenses of the arbitrator, shall
be shared equally by the Parties. The arbitration shall take place in a
neutral location selected by the arbitrator. The arbitrator may permit
discovery to the full extent permitted by the Federal Rules of Civil
Procedure or to such lesser extent as the arbitrator determines is
reasonable. The arbitrator shall be bound by and strictly enforce the terms
of this Agreement. The arbitrator shall make a good faith effort to apply
applicable law, but an arbitration decision and award shall not be subject to
review because of errors of law. The arbitrator shall have the sole authority
to resolve issues of the arbitrability of any disagreement, including the
applicability or running of any applicable statute of limitation. The
arbitrator shall not have power to award damages in connection with any
dispute in excess of actual compensatory damages nor to award punitive
damages nor any damages that are excluded under this Agreement and each party
irrevocably waives any claim thereto. The award of any arbitration shall be
final, conclusive and binding on the Parties. Judgment on the award may be
entered in any court having jurisdiction over the Party against which the
award was made. Nothing contained in this Section 13.2.3 shall be deemed to
prevent either party from seeking any interim equitable relief, such as a
preliminary injunction or temporary restraining order, pending the results of
the arbitration. The United States Arbitration Act and federal arbitration
20
<PAGE>
law shall govern the interpretation, enforcement, and proceedings pursuant to
the arbitration clause in this Agreement.
ARTICLE XIV.
SUCCESSORS AND ASSIGNS
14.1 Neither Party may, directly or indirectly, sell, assign,
transfer, or convey its interest in this Agreement or any of its rights or
obligations hereunder, including any assignment or transfer occurring by
operation of law, without the written consent of both Parties, except that
(i) either Party may assign or delegate this Agreement or any of its rights
or obligations hereunder to an Affiliate of such Party without the consent of
the other Party, but such assignment or delegation will not relieve the Party
of any of its obligations hereunder and (ii) a Party may assign its rights
and obligations hereunder to an assignee of its Service license or permit
issued by the FCC, provided that such assignee expressly assumes, by written
instrument approved in writing by the other Party, all of the obligations of
such Party hereunder and thereby becomes a Party hereunder. In no event will
an assignment permitted under this Section 14.1 without the consent of the
other Party obligate a Serving Carrier to provide Service to Customers of the
assignee or any of its Affiliates other than Customers residing in the area
in which the assignor previously was licensed to provide Service.
14.2 No person other than a Party to this Agreement or an
Indemnified Person shall acquire any rights hereunder as a third-party
beneficiary or otherwise by virtue of this Agreement.
ARTICLE XV.
NO PARTNERSHIP OR AGENCY RELATIONSHIP IS CREATED
Nothing contained in this Agreement shall constitute the Parties as
partners with one another or render any Party liable for any debts or
obligations of any other Party, nor shall any Party hereby be constituted the
agent of the other Party.
ARTICLE XVI.
NOTICES AND AUTHORIZED REPRESENTATIVES
Unless otherwise provided herein, any notice, request, instruction
or other document to be given hereunder by any Party to the other shall be in
writing and delivered by hand delivery, certified mail (postage prepaid,
return receipt requested), facsimile, or overnight air delivery service, as
follows:
21
<PAGE>
If to AWS, to: AT&T Wireless Services, Inc.
PO Box 97061
Redmond, WA 98073-9761
Attn: Intercarrier Services
with a copy to: AT&T Wireless Services, Inc.
PO Box 97061
Redmond, WA 98073-9761
Attn: Legal Department
If to ACC to: ACC Acquisition LLC
c/o Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: General Counsel
with a copy to: Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: General Counsel
or such other address as any Party may from time to time furnish to the other
Party by a notice given in accordance with the terms of this Section. All
such notices and communications shall be deemed to have been duly given at
the time delivered by hand, if personally delivered; three business days
after being deposited in the mail, if mailed; when receipt is confirmed, if
by facsimile and received by 3:00 p.m. local time on any business day and
otherwise on the next business day; and the next business day if sent by
overnight air delivery service.
ARTICLE XVII.
CONFIDENTIALITY
17.1 Each Party shall, and shall cause each of its Affiliates and
each of its and their employees, agents, and contractors, to keep
confidential and not use for any purpose except as contemplated by this
Agreement, any and all information and know-how provided to it by the other
Party which is identified in writing as confidential ("Confidential
Information"). Identification of information as confidential shall, in the
case of information delivered in tangible form, appear on at least the face
or first page of such information and, in the case of information
communicated verbally, be given verbally contemporaneously with the delivery
of the information and confirmed in writing within five business days
thereafter. Notwithstanding the foregoing, the following information shall be
treated as Confidential Information without any further identification as
such: (i) The terms, but not including the mere existence, of this Agreement;
and (ii) all information exchanged pursuant to Article VI.
22
<PAGE>
17.2 Notwithstanding Section 17.1, a Party shall have no obligation
to keep confidential any information that (a) was rightly in the receiving
Party's possession before receipt from the disclosing Party, (b) is or
becomes a matter of public knowledge without violation of this Agreement by
the receiving Party, (c) is rightfully received by the receiving Party from a
third party rightfully in possession of and, to the best of the receiving
Party's knowledge, with a right to make an unrestricted disclosure of such
information, (d) is disclosed by the disclosing Party to a third party
without imposing a duty of confidentiality on the third party, or (e) is
independently developed by the receiving Party without the use of any
Confidential Information. In addition, a Party may disclose any Confidential
Information to the extent required by applicable law or regulation or by
order of a court or governmental agency; provided, that prior to disclosure
the Party shall use all reasonable efforts to notify the other Party of such
pending disclosure and shall provide any reasonable assistance requested by
the other Party to maintain the confidentiality of the information.
17.3 The Parties agree that a Party will not have an adequate remedy
at law in the event of a disclosure or threatened disclosure of Confidential
Information in violation of this Article XVII. Accordingly, in such event, in
addition to any other remedies available at law or in equity, a Party shall
be entitled to specific enforcement of this Article XVII and to other
injunctive and equitable remedies against such breach without the posting of
any bond.
17.4 The obligations under this Article XVII shall survive the
termination of this Agreement for a period of three years.
ARTICLE XVIII.
MISCELLANEOUS
18.1 The Parties agree to comply with, conform to, and abide by all
applicable and valid laws, regulations, rules and orders of all governmental
agencies and authorities, and agree that this Agreement is subject to such
laws, regulations, rules and orders. All references in this Agreement to such
laws, regulations, rules and orders include any successor provision. If any
amendment to or replacement of the same materially alters the benefits,
rights, and duties of the Parties hereunder, the Parties agree to negotiate
in good faith an amendment to this Agreement to restore the respective
positions of the Parties to substantially the same point as existed prior to
such amendment or replacement.
18.2 The Parties agree to use their respective best, diligent, and
good faith efforts to fulfill all of their obligations under this Agreement.
The Parties recognize, however, that to effectuate all the purposes of this
Agreement, it may be necessary either to enter into future agreements or to
amend this Agreement, or both. In that event, the Parties agree to negotiate
with each other in good faith.
18.3 This Agreement constitutes the full and complete agreement of
the Parties with respect to the subject matter hereof. Any prior agreements
among the Parties with respect to this subject matter, are hereby superseded.
This Agreement may not be amended, except by
23
<PAGE>
the written consent of the Parties. Waiver of any breach of any provision of
the Agreement must be in writing signed by the Party waiving such breach or
provision and such waiver shall not be deemed to be a waiver of any preceding
or succeeding breach of the same or any other provision. The failure of a
Party to insist upon strict performance of any provision of this Agreement or
any obligation under this Agreement shall not be a waiver of such Party's
right to demand strict compliance therewith in the future.
18.4 The headings in this Agreement are inserted for convenience and
identification only and are not intended to describe, interpret, define or
limit the scope, extent or intent of this Agreement or any provision thereof.
18.5 This Agreement may be executed in counterparts, each of which
shall be deemed an original, but all of which together shall constitute one
and the same Agreement.
18.6 This Agreement shall be construed in accordance with the
internal laws of the State of Delaware without reference to the choice of law
principles, except as subject to the United States Arbitration Act and the
Federal Communications Act.
18.7 Except for claims by third parties which fall within the scope
of a Party's indemnification obligations under Section 6.3, neither Party
shall be liable to the other Party for any special, indirect, consequential,
or punitive damages.
18.8 The Parties agree that they will not use the name, service
marks or trademarks of the other party or any of its Affiliates in any
advertising, publicity releases or sales presentations, without such Party's
written consent. Neither Party is licensed hereunder to conduct business
under any logo, trademark, service or trade name (or any derivative thereof)
of the other Party.
18.9 No Party shall make any public statement or issue any press
release concerning the terms of this Agreement except as necessary to comply
with requirements of any law, regulation, or the order or judgment of a court
or tribunal of competent jurisdiction. If any such public statement or
release is so required, and AWS and ACC mutually agree to such statement or
release, the Party making such disclosure shall consult with the other Party
prior to making such statement or release and the Party shall use all
reasonable efforts, act in good faith, to agree upon a text for such
statement or release which is satisfactory to AWS and ACC. Nothing contained
herein is intended to limit the ability of the Parties to make statements
regarding the availability to such Party's Customers of the Services to be
provided hereunder by the other Party or that such other Party is the
provider of such Services.
18.10 Neither of the Parties will be liable for nonperformance or
defective performance of its obligations under this Agreement to the extent
and for such periods of time as such nonperformance or defective performance
is due to reasons outside such Party's control, including, without
limitation, acts of God, war, acts of any governmental authority, riots,
revolutions, fire, floods, explosions, sabotage, nuclear incidents,
lightning, weather, earthquakes, storms, sinkholes, epidemics, strikes, or
delays of suppliers or subcontractors for the same causes. Neither Party
shall be required to settle any labor dispute or other third party dispute in
24
<PAGE>
any manner which is deemed by that Party to be less than totally
advantageous, in that Party's sole discretion.
18.11 Except as specifically provided herein, this Agreement is a
non-exclusive arrangement between the Parties and nothing contained in this
Agreement is intended or should be construed to preclude or limit a Party
from obtaining from or providing to a third party Service of a type available
or required to be provided under this Agreement.
25
<PAGE>
EXECUTED as of the date first written above.
AT&T WIRELESS SERVICES, INC. ACC ACQUISITION LLC
By: /s/ Don Adams By: AT&T Wireless Services JV Co.
----------------------------
Name: Don Adams By: /s/ Don Adams
Title: Vice President - Carrier Relations -------------------------------
Title: Vice President - Carrier Relations Name: Don Adams
Date: 2/25/00 -----------------------------
-------------------------- Title: Vice President
----------------------------
Date: 2/25/00
-----------------------------
By: Dobson JV Company
By: /s/ Everett Dobson
-------------------------------
Name: Everett Dobson
-----------------------------
Title: President
----------------------------
Date: 2/25/00
-----------------------------
26
<PAGE>
AMENDED AND RESTATED OPERATING AGREEMENT
THIS AMENDED AND RESTATED OPERATING AGREEMENT (the "Agreement") is
dated as of the 25th day of February, 2000, by and between Dobson Cellular
Systems, Inc., on behalf of itself and its Affiliates listed in Schedule 1
hereto (individually and collectively, "Dobson") and ACC Acquisition LLC, on
behalf of itself and its Affiliates listed in Schedule 2 hereto (individually
and collectively, "ACC"). Dobson and ACC are sometimes referred to,
individually, as a "Party" and together as "Parties."
R E C I T A L
WHEREAS, each of Dobson and ACC desires to make arrangements to
facilitate the provision of voice and voice-related mobile wireless
radiotelephone service to its Customers through the wireless radiotelephone
facilities of the other Party in a manner providing a common look and feel
and the appearance of seamlessness between the Parties' facilities, in
accordance with the terms of this Agreement; and
WHEREAS, the parties hereto entered into an Operating Agreement,
dated as of January 31, 2000 (the "Original Agreement");
NOW, THEREFORE, in consideration of the premises and the mutual
promises herein set forth and intending to be legally bound hereby, the
Parties hereby agree, and the Original Agreement is hereby amended and
restated in its entirety, as follows:
ARTICLE I.
DEFINITIONS
As used in this Agreement, the terms below shall have the following
meanings:
ACC has the meaning set forth in the first paragraph of this Agreement.
ACC SERVICE AREA means the geographic area in which ACC and those of
its Affiliates now or hereafter listed on Schedule 2 provide Service.
ACC SYSTEM means the facilities owned and/or operated by ACC with
which it provides Service anywhere within the ACC Service Area.
ACC TDMA SYSTEM means that portion of the ACC System located in the
markets listed on Exhibit A.
ADOPTED FEATURES means the Core Features and the Future Core Features.
<PAGE>
AFFILIATE means, with respect to a Party, any facilities-based CMRS
operating company that (a) is controlled by or under common control with the
Party, (b) is an entity in which the Party has at least fifty percent (50%)
voting interest, (c) shares switching facilities with the Party, (d) is
managed by the Party, or (e) is providing Service utilizing CMRS spectrum it
has acquired from a Party; provided, that AT&T Wireless and Dobson
Communications Corporation and their respective Affiliates shall be deemed
not to be Affiliates of ACC for purposes of this Agreement.
APPROVED CIBERNET NEGATIVE FILE GUIDELINES means the negative file
guidelines appearing in the CIBER Record in effect from time to time.
AT&T WIRELESS means AT&T Wireless Services, Inc., individually.
AUTHORIZED RECEIPT POINT or ARP means the location or address of the
Party designated by the Home Carrier as the delivery point for its CIBER
records and authorized agent for performing CIBER edits.
AUTHORIZED ROAMER means a Roamer using equipment and an assigned
telephone number with the NPA/NXX combinations listed in accordance with
Article VI below for whom the Serving Carrier has not received a negative
notification in accordance with the provisions of this Agreement.
BTA means a geographic area designated by the FCC as a Basic Trading
Area in which a PCS System may be operated, as described more specifically in
47 CFR 24.202 of the FCC rules and regulations.
CELLULAR SYSTEM means a wireless communication system that is
operated pursuant to authority granted by the FCC under 47 CFR Part 22.
CIBER means Cellular Intercarrier Billing Exchange Record.
CIBER RECORD means the publication prepared by CIBERNET Corporation,
a wholly-owned subsidiary of the Cellular Telecommunications Industry
Association, as a service to the wireless communications industry. Unless
specifically provided otherwise in this Agreement, all words and phrases
defined in the CIBER Record shall have the meaning herein that they have
therein.
CLEARINGHOUSE means that entity which provides for the exchange of
CIBER records and performs industry accepted CIBER edits, including edits to
verify Industry Negative File information.
CMRS means any Commercial Mobile Radio Service as authorized by the
FCC.
CORE FEATURES means the Features that, as of the Effective Date,
Dobson and ACC have agreed to implement and maintain in order to create a
common look and feel and seamless subscriber service between the Dobson
System and the ACC System, as evidenced by their listing in Schedule E-1 to
Exhibit E attached hereto.
-2-
<PAGE>
CUSTOMER means an end-user of Service with which a Party has entered
into an agreement to provide such Service, regardless of whether such Service
is to be provided through the facilities of such Party.
DEFAULT has the meaning set forth in Section 13.1.
DOBSON has the meaning set forth in the first paragraph of this
Agreement.
DOBSON SYSTEM means the facilities owned and/or operated by Dobson
with which it provides Service anywhere within the United States.
EFFECTIVE DATE means the Closing Date under the Agreement and Plan
of Merger dated as of October 5, 1999 among ACC Acquisition LLC, ACC
Acquisition Co. and American Cellular Corporation.
ESN means the Electronic Serial Number that is encoded in a wireless
telephone set by the manufacturer and which is broadcast by such telephone.
EQUIPMENT means phones, handsets, transmitters, terminals, control
equipment and switches and other hardware and software required or useful to
use Service, including phones and handsets Customers use in connection with
Service.
FCC means the Federal Communications Commission and any successor
agency or authority.
FEATURES means voice and voice-related features and services
available from a Party through its mobile wireless telecommunication system.
FUTURE CORE FEATURES means the Features that are agreed upon as of
the date hereof (as evidenced by their listing on Schedule E-2 to Exhibit E
attached hereto) or in the future by the Parties pursuant to Section 10.3.2
as necessary to maintain a common look and feel, and seamless subscriber
service, between the Dobson System and the ACC System, and which the Parties
agree will be supported by both of their Systems, on the terms and conditions
of this Agreement, in the same manner as the Core Features. Once implemented,
a Future Core Feature shall be deemed a Core Feature for purposes of this
Agreement.
GENERAL AVAILABILITY means the date upon which the technology and
products that comprise any Future Core Features are commercially available at
a commercially reasonable price from the vendors of such technology and
product(s), and such Feature has successfully completed and passed the first
application in the System of the Party seeking to implement such features and
is ready for live commercial deployment.
HOME CARRIER means a Party who is providing Service to its
registered Customers.
HOME SERVICE AREA means the geographic area in which a Home Carrier
is licensed to provide Service.
-3-
<PAGE>
INDUSTRY NEGATIVE FILE means the negative file maintained by the
authorized Clearinghouses in accordance with approved CIBERNET Negative File
Guidelines.
MIN means the "Mobile Identification Number" which is assigned by a
Home Carrier to each of its registered Customers.
MSA means a geographic area designated by the FCC as a Metropolitan
Service Area in which a Cellular System may be operated, as described more
specifically in 47 CFR 22.909 of the FCC rules and regulations.
MTA means a geographic area designated by the FCC as a Major Trading
Area in which a PCS System may be operated, as described more specifically in
47 CFR 24.202 of the FCC rules and regulations.
NPA/NXX COMBINATIONS means the six-digit numerical combinations
assigned by regulatory authorities to identify the area code and telephone
number prefix for Service.
PCS SYSTEM means a wireless communication system that is operated
pursuant to authority granted by the FCC under 47 CFR Part 24.
PARTIES and PARTY have the meanings set forth in the first paragraph
of this Agreement.
ROAMER means a Customer of one Party who seeks Service from the
other Party within the geographic area served by the other Party, regardless
of whether Service also is offered in that area by the Party whose Customer
is seeking Service.
RSA means a geographic area designated by the FCC as a Rural Service
Area in which a Cellular System may be operated, as described more
specifically in 47 CFR 22.909 of the FCC rules and regulations.
SERVICE means telecommunications service for the transmission and
reception of voice and voice-related features provided by means of radio
frequencies that are or may be licensed, permitted or authorized now or in
the future by the FCC for use by a Cellular System or a PCS System, and in
respect of which service the user equipment is capable of and intended for
usage during routine movement, including halts at unspecified points, at more
than one location throughout a wide area public or private wireless network.
Unless otherwise specifically agreed by the Parties, Service shall include
personal base station services but, by way of example and without limitation,
does not include fixed wireless services, two-way messaging wireless services
(NBPCS), video broadcasting wireless services, television services (whether
cable, broadcast or direct broadcast satellite), broadcast radio services,
interactive informational or transactional content services such as on-line
content network services, Internet based services, satellite based
communications services, and air to ground communications services.
SERVING CARRIER means a Party who provides Service for registered
Customers of another Party while such Customers are in the geographic area
where the Serving Carrier, directly or through subsidiaries, provides Service.
-4-
<PAGE>
SYSTEM means the Dobson System or the ACC System, and SYSTEMS means
the Dobson System and the ACC System.
TDMA means the present and future North American Time Division
Multiple Access standard which is set by the Telecommunications Industry
Association (which at the Effective Date is IS-136), which is the essential
radio frequency technical method for digital wireless telephone operations
upon which the Service and equipment related thereto are designed to operate.
USER INTERFACE means the process, functional commands, and look and
feel by which a Customer operates and utilizes the Adopted Features,
including the sequence and detail of specific commands or service codes, the
detailed operation and response of Equipment to the sequence of keys pressed
to effect subscriber Equipment functions, and the response of subscriber
Equipment to the activation of these keys, or in response to signals or data
from either the ACC System or the Dobson System. Furthermore and for greater
certainty, such definition shall include without limitation, the manner in
which information is displayed on the screen of a phone used for Adopted
Features, announcement tones or messages occur, and service or feature codes
that must be dialed. The origins of the information presented to the user may
be the user Equipment, or the Dobson System or the ACC System, or both.
ARTICLE II.
PROVISION OF SERVICE
2.1 Each Party shall provide, to any Authorized Roamer who so
requests, in accordance with its own ordinary requirements, restrictions,
practices, and tariffs, if applicable, and with the terms and conditions of
this Agreement, any and all types of Service that such Party provides to its
own Customers within its Service Area. At a minimum, such Service shall
include voice communications capability, as well as any other types of
Service required by this Agreement, including without limitation Article X
hereof.
2.2 Notwithstanding anything in this Agreement to the contrary, a
Serving Carrier may suspend or terminate Service to an Authorized Roamer in
accordance with the terms of its own ordinary requirements, restrictions,
practices, and tariffs, if any, but such suspension or termination shall not
affect the rights and obligations of the Parties for Service furnished
hereunder prior to such termination or suspension.
2.3 In connection with its Service to Roamers, no Serving Carrier
shall use recorded announcements or other inducements for an Authorized
Roamer to discontinue the Service of its Home Carrier or, unless otherwise
authorized herein, Roamer's use of a Serving Carrier's system.
2.4 In the event that an operating entity becomes an Affiliate of a
Party after the date of this Agreement, such Party may, upon thirty (30) days
prior written notice to the other Party, add such operating entity to
Schedule 1 or Schedule 2, as the case may be, at the expiration of which
thirty-day period, in which event (a) the Customers of such entity shall be
entitled to
-5-
<PAGE>
Service as Roamers from the other Party on the terms and conditions of this
Agreement and (b) such operating entity shall provide Service to Customers of
the other Party who are Authorized Roamers, although the other Party is not
obligated to request such Service or to require its Customers to request such
Service. Notwithstanding the foregoing, the other Party, in its reasonable
discretion, may specify, by delivering written notice thereof prior to the
expiration of the thirty day period, that any Affiliate so added shall not be
entitled to preference as a Serving Carrier as otherwise provided in Section
2.5. Upon the addition to or deletion from Schedule 1 or 2 of any operating
entity pursuant to this Section 2.4, Exhibits A and B shall automatically be
revised accordingly, except that either Party may, in its sole discretion,
specify that an addition by either Party to Schedule 1 or 2 shall not be
given effect for any or all purposes of Section 2.5.
2.5
2.5.1 Dobson, in its capacity as Home Carrier, shall cause
substantially all of its Customers, when roaming in the markets operated by
ACC that are listed on Exhibit A, to normally seek Service as Roamers from
ACC prior to seeking Service from any other carrier. ACC, in its capacity as
Home Carrier, shall cause substantially all of its Customers, when roaming in
the markets operated by Dobson that are listed on Exhibit B, to normally seek
Service as Roamers from Dobson prior to seeking Service from any other
carrier.
2.5.2 As a condition to the right of a Party under Section
2.5.1 to be the preferred provider of Service to Customers of the other
Party, the market being served by the Serving Carrier shall (i) have fully
installed a TDMA-based system, including all Core Features, (ii) be fully
interoperable in accordance with Sections 10.6, 10.7, and 10.8, and (iii)
otherwise have met, and be in compliance with, all terms and conditions of
this Agreement.
2.6 ACC shall join and remain a member of the North American
Cellular Network throughout the term of this Agreement.
ARTICLE III.
RELATED SERVICES
3.1 Upon request by ACC, Dobson and ACC shall consider implementing
a common System Identification Number (SID) for markets operated by the
respective Parties in the same general vicinity or taking other steps to
suppress the roaming indicator on a Customer's handset from lighting to
indicate that the Customer is roaming in such markets, but each Party may, in
its sole discretion, decide whether to implement such measure.
3.2 Each Party, within the geographic areas in which such Party
provides Service, will provide Service without any additional toll charge
throughout an area (a so-called "home calling area") that is of a size at
least reasonably comparable to the area within which toll-free calls placed
through facilities that are exclusively land-based are available.
-6-
<PAGE>
ARTICLE IV.
CUSTOMER SERVICE
4.1 The Parties shall use commercially reasonable efforts to develop
and implement systems enabling each Party, as Serving Carrier, to route to a
Customer's Home Carrier any 611 customer service call received from a
Customer of the other Party while roaming on the Serving Carrier's System.
ARTICLE V.
CHARGES
Each Home Carrier, whose Customers (including the Customers of its
resellers) receive service from a Serving Carrier as Authorized Roamers under
this Agreement, shall pay to the Serving Carrier who provided such service
100% of the Serving Carrier's charges for CMRS and one hundred percent (100%)
of the toll charges pursuant to Exhibit C. The amount of the charges for the
use of each Serving Carrier's Service are set forth in Exhibit C attached to
this Agreement.
ARTICLE VI.
EXCHANGE OF INFORMATION
6.1 The Parties shall furnish to each other, in the format of
Exhibit D to this Agreement, the valid NPA/NXX combinations used by their
respective Customers. These combinations shall be accepted by the other
Party. Each NPA/NXX combination is and shall be within the entire line range
(0000-9999), or a specified portion thereof. The minimum line range to be
exchanged by the Parties shall be 1,000 line numbers. Each Party shall be
responsible for all billings otherwise properly made under this Agreement to
any number listed by such Party within the range or ranges specified by it in
Exhibit D. Additions, deletions, or changes to NPA/NXX combinations and line
number range(s) for the Home Carrier's Customers may be made upon at least
fifteen (15) days prior written notice to the Serving Carrier. Such notice
shall be in the form attached as Exhibit D to this Agreement and shall
include the requested effective date for the addition, deletion or change.
6.2 [Reserved]
6.3 Each Party hereby agrees to indemnify the other Party, together
with its partners and any and all of their officers, directors, employees,
agents and/or affiliates, against, and hold them harmless from, any and all
claims, suits, demands, losses and expenses, including reasonable attorneys'
fees and disbursements, which may result in any way whatsoever from the
indemnified Party's denial of Roamer or local Service to any NPA/NXX
combination which has been listed by the indemnifying Party as not being
authorized to receive Service; provided that (i)
-7-
<PAGE>
the person seeking indemnification (the "Indemnified Person") provides notice
of such claim promptly after its discovery to the Party from which
indemnification is sought (the "Indemnifying Person") and in any event the
Indemnifying Person will be released from any obligation hereunder to the
extent it is prejudiced by any delay in the delivery of such notice, (ii) the
Indemnifying Person shall have the right to assume the defense of such claim,
(iii) the Indemnified Person shall provide such reasonable assistance and
cooperation in the defense of such claim as is requested by the Indemnifying
Person, and (iv) the Indemnified Person shall not settle or compromise any
such claim without the prior written consent of the Indemnifying Person.
6.4 [Reserved]
6.5 Upon the implementation of wireless number portability in any
portion of either the Dobson System or the ACC System, the Parties shall
cooperate in establishing an alternative method for exchanging ESN and/or
NPA/NXX information required to permit roaming by the other Party's Customers in
their respective systems.
ARTICLE VII.
FRAUD
7.1 The Parties will cooperate and, as necessary, supplement this
Agreement in order to minimize fraudulent or other unauthorized use of their
systems. If any Party reasonably decides that, in its sole judgment, despite due
diligence and cooperation pursuant to the preceding sentence, fraudulent or
other unauthorized use has reached an unacceptable level of financial loss and
is not readily remediable, such Party may suspend the use of applicable NPA/NXX
combinations, in whole or in part, pursuant to the terms of this Agreement.
7.2 Each Party shall take reasonable actions to control fraudulent
Roamer usage, including without limitation using either (i) a positive
validation/verification ("PV") system provided by a mutually agreed upon
validation/verification service under which the ESN and/or NPA/NXX used in a
call in the Serving Carrier's system is compared against a list of Authorized
Roamers or (ii) SS-7 connections through a network of carriers. The Parties
shall work together in good faith to designate and implement a system as
specified in the preceding sentence and enhancements thereto or alternative
systems as they shall agree in the future. The Home Carrier shall have no
responsibility or liability for calls completed by a Serving Carrier without
obtaining positive validation/verification as required herein.
7.3 In addition to other procedures set forth in this Agreement, a
Home Carrier may notify a Serving Carrier by facsimile, with written
confirmation, that certain NPA/NXX combinations are not to receive Service.
Any calls completed using such NPA/NXX combinations made one full business
day or more after such notice has been given shall be the sole responsibility
of the Serving Carrier, and the Home Carrier shall not be charged any amount
for such calls.
-8-
<PAGE>
7.4 Each Serving Carrier shall use commercially reasonable efforts
to provide each Home Carrier with real-time visibility of call detail records
delivered through a network compatible with AT&T Wireless's network. Such
information shall be delivered within one hour of the applicable call. In the
event that the Serving Carrier provides such a real-time visibility system, the
Serving Carrier shall not be liable in any event for a temporary failure of the
system unless the Serving Carrier has been notified of such failure by the Home
Carrier and the Serving Carrier does not take commercially reasonable steps to
remedy the failure. If the Serving Carrier has been so notified and has failed
to take such commercially reasonable steps, the Serving Carrier shall be liable
for all unauthorized usage attributed to Home Carrier's subscribers during the
period from the time Serving Carrier was notified of the problem to the time
that the problem has been resolved to the reasonable satisfaction of the Home
Carrier.
7.5 For purposes of notification under this Article VII, the following
addresses and facsimile numbers shall be used:
If to Dobson: Dobson Cellular Systems, Inc.
c/o Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: G. Edward Evans
Tel. No. 405-529-8500
Fax No. 405-529-8515
If to ACC: ACC Acquisition LLC
c/o Dobson JV Company
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: G. Edward Evans
Tel. No. 405-529-8500
Fax No. 405-529-8515
Each Party may change the names, addresses and numbers set forth above
by providing notice to the other Party as provided in Article XVI below.
ARTICLE VIII.
BILLING
8.1 Each Home Carrier shall be responsible for billing to, and
collecting from, its own Customers all charges that are incurred by such
Customers as a result of service provided to them as Authorized Roamers by the
Serving Carrier. The Home Carrier shall also be responsible for billing its
Customers for, and remitting to, the Federal Government all federal excise tax
that may be due in connection with the service being billed by it to its
Customers. While the Serving Carrier will be responsible for the computation and
remittance of all state and local taxes, each
-9-
<PAGE>
Home Carrier shall be liable to the Serving Carrier for all such state and
local taxes remitted by the Serving Carrier, for Authorized Roamers
regardless of whether these amounts are paid to the Home Carrier by its
Customers.
8.2 Each Serving Carrier who provides Service to an Authorized Roamer
pursuant to this Agreement shall forward Roamer billing information, within five
business days of the call date, in accordance with the procedures and standards
set forth in the CIBER Record to the Home Carrier's Authorized Receipt Point.
CIBER Type 50 and CIBER Type 70 records shall not be accepted without mutual
signed agreement and if such mutual agreement is reached it will be attached to
this Agreement. Any future revisions of the CIBER Record or additional record
types must be mutually agreed upon before implementation. In the event the
parties use the CIBERNET Net Settlement Program, or alternative settlement
program such information must be in a format in compliance with the CIBER Record
requirements or agreed upon format.
8.3 Where the Authorized Roamer billing information required to be
provided by the Serving Carrier in accordance with Section 8.2 above is not in
accordance with the CIBER Record, the Home Carrier may return a record to the
Serving Carrier as provided in the CIBER Record. Returning the defective record
will be in accordance with CIBER Record established procedures. The Serving
Carrier may correct the defective record and return it to the Home Carrier for
billing, provided that the time period from the date of the Service call at
issue to the receipt of the corrected record does not exceed sixty (60) days.
8.4 No credit for insufficient data or defective records shall be
permitted except as provided in Section 8.3 above, unless mutually agreed upon
by both Parties.
8.5 Each Home Carrier may at its discretion perform any necessary
edits at its Clearinghouse on incollect or outcollect call records to ensure
compliance with the terms of this Agreement.
ARTICLE IX.
SETTLEMENT
9.1 Each Party will settle its accounts with the other Parties on the
basis of billing information received as described in this Article IX. In the
event both Parties use a net financial settlement procedure, the Parties shall
not submit a paper invoice but will make payments in accordance with such net
financial settlement procedures provided that the Parties may submit call
records for payment that relate to calls made more than sixty (60) days from the
date of the call if such call was the subject of a dispute or investigation
regarding fraudulent or unauthorized use.
9.2 If an incorrect roaming rate is charged by the Serving Carrier to
the Home Carrier, the Serving Carrier shall refund all amounts in excess of the
contract rate back to the Home Carrier within forty five days of notification by
the Home Carrier. Each carrier shall have ninety (90) days from the end of the
settlement period to invoice for amounts in excess of the contract
-10-
<PAGE>
rate. The Home Carrier will send a collection letter within sixty (60) days
of the invoice date, within ninety (90) days of the invoice date, and within
one hundred (120) days of the invoice date. If the invoice remains unpaid
after one hundred twenty (120) days from the original invoice date, the Home
Carrier may withhold the amounts from the CIBERNET Net Settlement Program or
alternative settlement program.
9.3 In the event that either Party does not use a net financial
settlement procedure, the billing and payment for charges incurred under this
Agreement shall be as set forth below.
9.3.1 The parties shall determine amounts owed to each other
for Service provided to Roamers in one-month periods with such period beginning
on the sixteenth day of each calendar month and ending on the fifteenth day of
the following month in which Service is provided. The end of this Period shall
be referred to as "Close of Billing."
9.3.2 The Parties shall send each other an invoice for
Services used under this Agreement within fifteen (15) days after the Close of
Billing.
9.3.3 Each invoice shall contain the following information.
a. Billing period used by Serving Carrier
b. Batch sequence number
c. Serving and Home Carrier System Identification Number
d. Air Service charges
e. Total toll charges (both intrastate and interstate)
f. All other charges and credits
g. Total taxes
h. Total charges
9.3.4 Payment on such invoices shall be made in the form of a
check or a wire transfer which must be received by the invoicing party within
thirty (30) days from the date of the invoice. Late payments shall be charged
with a late payment fee of one and one half percent (1.5%) of the outstanding
balance for each thirty-day period (or portion thereof) that such payments are
late.
9.3.5 Each Party may offset the amount owed to the other Party
under this Agreement and a single payment of the balance to the Party entitled
to receive such balance shall be made.
9.4 If the Serving Carrier provides pre-call validation of the Home
Carrier's Customers, the Home Carrier agrees to implement Negative File
Suppression at the Clearinghouse and the CIBERNET Negative File Guidelines and
procedures do not apply.
-11-
<PAGE>
ARTICLE X.
INTEROPERABILITY
10.1 The Parties agree that their respective obligations under this
Agreement related to the interoperability of the Dobson System and the ACC TDMA
System shall be construed in accordance with the following general principles:
10.1.1 The Parties agree, confirm and acknowledge that one of
their primary objectives in entering into this Agreement is to promote the
establishment and operation throughout the United States of a mobile wireless
service that is TDMA-based and that will appear to their respective subscribers
as a single mobile wireless network with a common User Interface pertaining to
the Adopted Features, and that they intend to achieve such purpose and objective
as set forth in, and subject to the terms and conditions of, this Agreement.
Adopted Features shall be made available to all Customers of a Party when
roaming in the Dobson System or the ACC TDMA System, subject to the terms of
this Agreement. Each Party shall use good faith efforts, when implementing any
software or other System change or upgrade, to confirm the continued
availability of the Feature interoperability provided for herein, and in the
event of any interference with any Feature interoperability shall work
expeditiously to restore required functionality. Without limiting the generality
of the foregoing, in the event the Authentication Fraud Protection Feature (or
any subsequent or comparable fraud protection Feature) is disabled or affected
by any network change so as to interfere with its interoperability, the Party
responsible for such network shall restore interoperability within 48 hours of
notification from the affected Party.
10.1.2 The Parties agree that each of their respective
obligations, duties, rights and entitlements pursuant to this Agreement shall be
interpreted, to the extent such interpretation is required to resolve any
dispute or uncertainty concerning this Agreement, in a manner that is reasonably
consistent with, and which reasonably supports, the purpose and objective of
this Agreement as set out in Section 10.1.1.
10.1.3 The Parties agree that they each shall, in good faith,
work together, cooperate, and use the rights that they each have granted the
other under this Agreement for the purposes set out in Section 10.1.1 and on the
terms and conditions of this Agreement.
10.2 The Parties agree to implement TDMA-based systems as follows:
10.2.1 The Parties each acknowledge and confirm that their
digital standard for, in the case of Dobson, the Dobson System and, in the case
of ACC, the ACC TDMA System, is currently (as of the Effective Date) TDMA.
10.2.2 The Parties shall deploy TDMA throughout the ACC TDMA
System and the Dobson System within twelve (12) months after the date of this
Agreement. The Parties shall use commercially reasonable efforts to promote the
use of TDMA-based communications devices among their respective Customers who
roam on the Dobson System or the ACC TDMA System, as the case may be.
-12-
<PAGE>
10.3 Each of the Parties agrees that it shall operate and support its
TDMA-based System, to the extent installed, to ensure that the other Party's
Customers can use the Adopted Features when roaming on the Serving Carrier's
TDMA-based System in the same manner that such Customers use such Adopted
Features on the Home Carrier's TDMA-based System.
10.3.1 CORE FEATURES. Each Party shall, at its own expense,
implement the Core Features in the Dobson System, in the case of Dobson, and in
the ACC TDMA System, in the case of ACC, as soon as reasonably practicable and
in any event within one (1) year after the Effective Date. Thereafter, Core
Features shall be implemented at the time any TDMA-based system is placed into
operation.
10.3.2 FUTURE CORE FEATURES. The Future Core Features shall be
those features set forth on Schedule E-2 to Exhibit E attached hereto or those
features that are agreed upon by the Parties from time to time after the
execution of this Agreement. Each Party shall, at its own expense, implement
such Future Core Features within one (1) year after the General Availability of
such Future Core Features, provided that, and subject to such Party's
determination, in its sole and absolute discretion, that such implementation is
both financially feasible and economically viable, and consistent with such
Party's objective of maximizing its financial performance. In the event that a
Party opts not to adopt a Future Core Feature in accordance with this Section
10.3.1, it shall promptly notify the other Party of that decision. Future Core
Features shall be implemented in accordance with this Section in the areas
specified for each respective Party in Section 10.3.1.
10.3.3 The Parties shall use commercially reasonable efforts
to comply with the network performance standards with respect to the Adopted
Features that are set out in Schedule E-3 to Exhibit E attached hereto.
10.4 Neither Party shall provide the other Party's Customers with
Service inferior in quality to that provided to its own Customers. Each Party
shall provide Service to Customers of the other Party of a quality level, based
on criteria customarily used to evaluate the performance of wireless voice
systems, comparable to or exceeding industry norms. Any assessment of "quality"
shall be with reference to the System's performance as a whole within a specific
MSA, RSA, or BTA, as the case may be, and shall be over such a period of time as
reasonably necessary to yield an accurate depiction of System "quality" taking
into account all of the variables which may affect System performance.
10.5 In order to facilitate performance by each of the Parties of
their obligations under this Article X, the Parties agree to exchange and
share information with each other as follows, except that nothing contained
herein shall be construed to require a Party to exchange information that the
Party considers confidential or proprietary.
10.5.1 Subject to Article XVII of this Agreement, the Parties
shall provide each other, on a reasonably prompt basis, with all information and
materials that either has a right to disclose that is necessary to meet the
interoperability standards set forth in this Article X, including without
limitation the following information:
-13-
<PAGE>
System Engineering:
- Minimum Standards for Systems
Features:
- Capability description of present Core Features and
other Features
- User Interface (codes)
- Implementation procedures
- Roaming requirements
- Feature functionality design documents
Research and Development:
- operational test results
- operational defects and bugs
- remedial/back-up plans
- operational, functional and technical specifications
- all related documentation
- systems integration
10.5.2 Each Party agrees that it shall, in performing its
obligations to provide the other Party with information in accordance with
Section 10.5, act reasonably, and in good faith toward the other Party.
10.5.3 Nothing contained herein is intended or should be
construed to constitute the transfer or grant by one Party to the other of any
ownership, license, or other rights of or to any trade secret, know-how, or
other intellectual property by one Party to the other.
10.6 Each Party shall provide for automatic call delivery for
Customers of the other Party who are Roamers in such Party's system. To this
end, each Party shall continuously provide the hardware, software and
transmission facilities required for such call delivery either directly
between the systems of the Parties or indirectly through a separate network
of wireless communications carriers. The hardware, software and transmission
facilities provided by each Party hereunder shall at all times be operated
and maintained to provide the most efficient level of service that is
technically feasible and commercially reasonable to minimize transmission
errors and Service interruptions.
10.7 If the Parties have implemented linking facilities as
contemplated in Section 10.8, the Serving Carrier shall automatically
hand-off to the Home Carrier, and as requested shall automatically accept
hand-off from the Home Carrier in order to provide Service as specified in
Article II, calls to or from a Customer of the Home Carrier in accordance
with the hand-off procedures established for such linking facilities. To this
end, each Party shall continuously provide the hardware, software and
transmission facilities required for such call hand-off either
-14-
<PAGE>
directly between the systems of such Home and Serving Carrier or indirectly
through a separate network of wireless communications carriers. The hardware,
software and transmission facilities provided by each Party hereunder shall at
all times be operated and maintained to provide the most efficient level of
service that is technically feasible and commercially reasonable to minimize
transmission errors and Service interruption.
10.8 The Parties will work together to evaluate the economic advantage
of various switch linking options to interconnect and facilitate networking of
the Parties' respective Systems as required by this Agreement. Should the
Parties agree to install and maintain linking facilities, the cost of the
linking facilities shall be allocated pursuant to the following provisions:
10.8.1 Dobson and ACC will each pay one-half of the equipment
costs for the establishment of microwave facilities to link the Parties'
respective Systems for the purposes of automatic call delivery and automatic
call hand-off. Each Party is solely responsible for the costs of preparing its
own facilities for the System link.
10.8.2 Equipment costs for the establishment of a landline
link (T-1) to link the Parties' respective Systems together for these purposes
shall be split between the Parties as follows:
(a) Dobson and ACC shall each pay one-half of the cost
for the installation, use, modification, or discontinuance of the linking
facilities. Each party is solely responsible for all costs to prepare its own
facilities for the link between the Systems.
(b) For ease of administration, Dobson will order and
be the customer of record ("COR") for such facilities. ACC will reimburse
Dobson monthly for its share of the recurring costs of such facilities. The
COR shall be responsible for invoicing the other Party for its share of the
costs, with payment due within 30 days of receipt of the invoice.
10.8.3 The Parties agree that this Section 10.8 relates only
to those costs necessary to establish the referenced facilities. This section is
not applicable to the allocation of costs with respect to the provision of
service for each Party's Customers.
10.9 The Parties agree that the revenues and costs for a call belong
to the Party whose System operates the originating cell site (the "Bill and Keep
System").
ARTICLE XI.
REPRESENTATIONS AND WARRANTIES
11.1 Dobson hereby represents and warrants to ACC that:
11.1.1 Dobson Cellular Systems, Inc. is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Oklahoma. Dobson Cellular Systems, Inc. has all requisite power and authority to
execute and deliver this Agreement and to
-15-
<PAGE>
cause this Agreement to be the binding obligation, to the extent provided
herein, of those of its Affiliates listed on Schedule 1 or added to Schedule
1 hereafter in accordance with Section 2.4.
11.1.2 This Agreement is the legal, valid, and binding
obligation of Dobson Cellular Systems, Inc., enforceable against Dobson Cellular
Systems, Inc. in accordance with its terms, except that such enforceability may
be subject to (a) bankruptcy, insolvency, reorganization, moratorium, or other
similar laws now or hereafter in effect relating to creditors' rights generally
and (b) equitable principles of law and the discretion of any court or arbitral
body before which any related proceeding may be brought.
11.1.3 The execution, delivery, and performance of this
Agreement by Dobson Cellular Systems, Inc. does not and will not conflict with
or result in a material default, suspension, or termination of any agreement,
contract, obligation, license, or authorization with or granted by any third
party or governmental body.
11.2 ACC hereby represents and warrants to Dobson that:
11.2.1 ACC is a limited liability company duly organized,
validly existing, and in good standing under the laws of the State of Delaware.
ACC has all requisite power and authority to execute and deliver this Agreement
and to cause this Agreement to be the binding obligation, to the extent provided
herein, of those of its Affiliates listed on Schedule 2 or added to Schedule 2
hereafter in accordance with Section 2.4.
11.2.2 This Agreement is the legal, valid, and binding
obligation of ACC, enforceable against ACC in accordance with its terms,
except that such enforceability may be subject to (a) bankruptcy, insolvency,
reorganization, moratorium, or other similar laws now or hereafter in effect
relating to creditors' rights generally and (b) equitable principles of law
and the discretion of any court or arbitral body before which any related
proceeding may be brought.
11.2.3 The execution, delivery, and performance of this
Agreement by ACC does not and will not conflict with or result in a material
default, suspension, or termination of any agreement, contract, obligation,
license, or authorization with or granted by any third party or governmental
body.
ARTICLE XII.
TERM, TERMINATION AND SUSPENSION OF AGREEMENT
12.1 This Agreement shall have a term commencing on the Effective Date
and continuing for a period of twenty (20) years; PROVIDED, that the provisions
of Section 2.5 shall terminate on the earlier of (i) the fifth anniversary of
the Effective Date and (ii) termination of the roaming preference obligations of
Dobson under Section 8.2(a) of the LLC Agreement. Thereafter, this Agreement
shall continue in force on a month-to-month basis unless either party terminates
the Agreement by written notice to the other party given at least 90 days prior
to the
-16-
<PAGE>
date of termination. Otherwise, this Agreement may be terminated or suspended
only as provided in this Article XII.
12.2 This Agreement may be terminated or suspended by either Party
immediately upon written notice to the other of a Default (as defined in Section
13.1) by the other Party. In addition, either Party may suspend this Agreement
immediately upon written notice to the other Party pursuant to Section 13.1.1 of
the existence of a breach of this Agreement, whether or not such breach
constitutes a Default, which materially affects the Service being provided to
Customers of the non-breaching Party. While any suspension of this Agreement,
whether in part or in whole, is in effect, the obligations of the Parties shall
be only those that survive termination and to work together to resolve as
expeditiously as possible any difficulty that resulted in a suspension. At such
time as the Party originally giving notice of suspension concludes that the
problem causing the suspension has been resolved, that Party shall give to the
other written notice to this effect. This Agreement shall resume in full effect
within five (5) business days after the Parties have mutually agreed that the
problem has been resolved.
12.3 The Parties shall cooperate to limit the extent and effect of any
suspension of this Agreement to what is reasonably required to address only the
cause of such suspension.
12.4 In the event that a Party transfers control of an Affiliate
listed in Schedule 1 or Schedule 2, as the case may be, the Party shall
provide at least four months' prior written notice to the other Party and
upon such transfer such Affiliate shall be deleted from the appropriate
Schedule, but doing so will not relieve a Party of its obligations under
Section 14.1.
12.5 The termination or suspension of this Agreement shall not affect
the rights and liabilities of the Parties under this Agreement with respect to
all Authorized Roamer charges incurred prior to the effective date of such
termination or suspension.
ARTICLE XIII.
DEFAULT
13.1 A Party will be in "Default" under this Agreement upon the
occurrence of any of the following events:
13.1.1 Material breach of any material term of this Agreement,
if such breach shall continue for thirty (30) days after receipt of written
notice thereof from the nonbreaching Party;
13.1.2 Voluntary liquidation or dissolution or the approval by
the management, board of directors, stockholders, or owners of a Party of any
plan or arrangement for the voluntary liquidation or dissolution of the Party;
-17-
<PAGE>
13.1.3 A final order by the FCC revoking or denying renewal of
CMRS licenses or permits granted to such Party which, individually or in the
aggregate, are material to the business of such Party; or
13.1.4 Such Party (i) filing pursuant to a statute of the
United States or of any state, a petition for bankruptcy or insolvency or for
reorganization or for the appointment of a receiver or trustee for all or a
portion of such Party's property, (ii) has filed against it, pursuant to a
statute of the United States or of any state, a petition for bankruptcy or
insolvency or for reorganization or for the appointment of a receiver or trustee
for all or a portion of such Party's property, provided that within 120 days
after the filing of any such petition such Party fails to obtain a discharge
thereof, or (iii) making an assignment for the benefit of creditors or
petitioning for, or voluntarily entering into, an arrangement of similar nature,
and provided that such filing, petition, or appointment is still continuing.
13.2 All claims and disputes relating in any way to the performance,
interpretation, validity, or breach of this Agreement, including but not limited
to a claim based on or arising from an alleged tort, shall be resolved as
provided in this Section 13.2. It is the intent of the Parties that any
disagreements be resolved amicably to the greatest extent possible.
13.2.1 If a disagreement cannot be resolved by the
representatives of the Parties with day-to-day responsibility for this
Agreement, such matter shall be referred to an executive officer of each of the
Parties. The executive officers shall conduct face-to-face negotiations at a
neutral location or such other location as shall be mutually agreed upon. If
these representatives are unable to resolve the dispute within ten business days
after either Party requests the involvement of the executive officers, then
either Party may, but is not required to, refer the matter to mediation or
arbitration, as applicable in accordance with Sections 13.2.2 and 13.2.3.
13.2.2 In any case where the amount claimed or at issue is One
Million Dollars ($1,000,000) or more and the Parties are unsuccessful in
resolving the disagreement, the Parties agree to submit the disagreement to
non-binding mediation upon written notification by either Party. The Parties
shall mutually select an independent mediator experienced in telecommunications
system disputes. The specific format for the mediation shall be left to the
discretion of the mediator. If mediation does not result in resolution of the
disagreement within thirty days of the initial request for mediation, then
either Party may, but is not required to, refer the matter to arbitration.
13.2.3 Any disagreement not finally resolved in accordance
with the foregoing provisions of this Section 13.2 shall, upon written notice by
either Party to the other, be resolved by final and binding arbitration. Subject
to this Section 13.2.3, such arbitration shall be conducted through, and in
accordance with the rules of, JAMS/Endispute. A single neutral arbitrator shall
decide all disputes. Each Party shall bear its own expenses with respect to the
arbitration, except that the costs of arbitration proceeding itself, including
the fees and expenses of the arbitrator, shall be shared equally by the Parties.
The arbitration shall take place in a neutral location selected by the
arbitrator. The arbitrator may permit discovery to the full extent
-18-
<PAGE>
permitted by the Federal Rules of Civil Procedure or to such lesser extent as
the arbitrator determines is reasonable. The arbitrator shall be bound by and
strictly enforce the terms of this Agreement. The arbitrator shall make a
good faith effort to apply applicable law, but an arbitration decision and
award shall not be subject to review because of errors of law. The arbitrator
shall have the sole authority to resolve issues of the arbitrability of any
disagreement, including the applicability or running of any applicable
statute of limitation. The arbitrator shall not have power to award damages
in connection with any dispute in excess of actual compensatory damages nor
to award punitive damages nor any damages that are excluded under this
Agreement and each party irrevocably waives any claim thereto. The award of
any arbitration shall be final, conclusive and binding on the Parties.
Judgment on the award may be entered in any court having jurisdiction over
the Party against which the award was made. Nothing contained in this Section
13.2.3 shall be deemed to prevent either party from seeking any interim
equitable relief, such as a preliminary injunction or temporary restraining
order, pending the results of the arbitration. The United States Arbitration
Act and federal arbitration law shall govern the interpretation, enforcement,
and proceedings pursuant to the arbitration clause in this Agreement.
ARTICLE XIV.
SUCCESSORS AND ASSIGNS
14.1 Neither Party may, directly or indirectly, sell, assign,
transfer, or convey its interest in this Agreement or any of its rights or
obligations hereunder, including any assignment or transfer occurring by
operation of law, without the written consent of both Parties, except that
(i) either Party may assign or delegate this Agreement or any of its rights
or obligations hereunder to an Affiliate of such Party without the consent of
the other Party, but such assignment or delegation will not relieve the Party
of any of its obligations hereunder and (ii) a Party may assign its rights
and obligations hereunder to an assignee of its Service license or permit
issued by the FCC, provided that such assignee expressly assumes, by written
instrument approved in writing by the other Party, all of the obligations of
such Party hereunder and thereby becomes a Party hereunder. In no event will
an assignment permitted under this Section 14.1 without the consent of the
other Party obligate a Serving Carrier to provide Service to Customers of the
assignee or any of its Affiliates other than Customers residing in the area
in which the assignor previously was licensed to provide Service.
14.2 No person other than a Party to this Agreement or an Indemnified
Person shall acquire any rights hereunder as a third-party beneficiary or
otherwise by virtue of this Agreement.
-19-
<PAGE>
ARTICLE XV.
NO PARTNERSHIP OR AGENCY RELATIONSHIP IS CREATED
Nothing contained in this Agreement shall constitute the Parties as
partners with one another or render any Party liable for any debts or
obligations of any other Party, nor shall any Party hereby be constituted the
agent of the other Party.
ARTICLE XVI.
NOTICES AND AUTHORIZED REPRESENTATIVES
Unless otherwise provided herein, any notice, request, instruction or
other document to be given hereunder by any Party to the other shall be in
writing and delivered by hand delivery, certified mail (postage prepaid, return
receipt requested), facsimile, or overnight air delivery service, as follows:
If to Dobson, to: Dobson Cellular Systems, Inc.
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: General Counsel
with a copy to: Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: General Counsel
If to ACC to: ACC Acquisition LLC
c/o Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: General Counsel
with a copy to: Dobson Communications Corporation
13439 North Broadway Extension
Oklahoma City, OK 73114
Attn: General Counsel
or such other address as any Party may from time to time furnish to the other
Party by a notice given in accordance with the terms of this Section. All such
notices and communications shall be deemed to have been duly given at the time
delivered by hand, if personally delivered; three business days after being
deposited in the mail, if mailed; when receipt is confirmed, if by facsimile and
received by 3:00 p.m. local time on any business day and otherwise on the next
business day; and the next business day if sent by overnight air delivery
service.
-20-
<PAGE>
ARTICLE XVII.
CONFIDENTIALITY
17.1 Each Party shall, and shall cause each of its Affiliates and each
of its and their employees, agents, and contractors, to keep confidential and
not use for any purpose except as contemplated by this Agreement, any and all
information and know-how provided to it by the other Party which is identified
in writing as confidential ("Confidential Information"). Identification of
information as confidential shall, in the case of information delivered in
tangible form, appear on at least the face or first page of such information
and, in the case of information communicated verbally, be given verbally
contemporaneously with the delivery of the information and confirmed in writing
within five business days thereafter. Notwithstanding the foregoing, the
following information shall be treated as Confidential Information without any
further identification as such: (i) The terms, but not including the mere
existence, of this Agreement; and (ii) all information exchanged pursuant to
Article VI.
17.2 Notwithstanding Section 17.1, a Party shall have no obligation to
keep confidential any information that (a) was rightly in the receiving Party's
possession before receipt from the disclosing Party, (b) is or becomes a matter
of public knowledge without violation of this Agreement by the receiving Party,
(c) is rightfully received by the receiving Party from a third party rightfully
in possession of and, to the best of the receiving Party's knowledge, with a
right to make an unrestricted disclosure of such information, (d) is disclosed
by the disclosing Party to a third party without imposing a duty of
confidentiality on the third party, or (e) is independently developed by the
receiving Party without the use of any Confidential Information. In addition, a
Party may disclose any Confidential Information to the extent required by
applicable law or regulation or by order of a court or governmental agency;
provided, that prior to disclosure the Party shall use all reasonable efforts to
notify the other Party of such pending disclosure and shall provide any
reasonable assistance requested by the other Party to maintain the
confidentiality of the information.
17.3 The Parties agree that a Party will not have an adequate remedy
at law in the event of a disclosure or threatened disclosure of Confidential
Information in violation of this Article XVII. Accordingly, in such event, in
addition to any other remedies available at law or in equity, a Party shall be
entitled to specific enforcement of this Article XVII and to other injunctive
and equitable remedies against such breach without the posting of any bond.
17.4 The obligations under this Article XVII shall survive the
termination of this Agreement for a period of three years.
ARTICLE XVIII.
MISCELLANEOUS
18.1 The Parties agree to comply with, conform to, and abide by all
applicable and valid laws, regulations, rules and orders of all governmental
agencies and authorities, and agree
-21-
<PAGE>
that this Agreement is subject to such laws, regulations, rules and orders.
All references in this Agreement to such laws, regulations, rules and orders
include any successor provision. If any amendment to or replacement of the
same materially alters the benefits, rights, and duties of the Parties
hereunder, the Parties agree to negotiate in good faith an amendment to this
Agreement to restore the respective positions of the Parties to substantially
the same point as existed prior to such amendment or replacement.
18.2 The Parties agree to use their respective best, diligent, and
good faith efforts to fulfill all of their obligations under this Agreement.
The Parties recognize, however, that to effectuate all the purposes of this
Agreement, it may be necessary either to enter into future agreements or to
amend this Agreement, or both. In that event, the Parties agree to negotiate
with each other in good faith.
18.3 This Agreement constitutes the full and complete agreement of the
Parties with respect to the subject matter hereof. Any prior agreements among
the Parties with respect to this subject matter, are hereby superseded. This
Agreement may not be amended, except by the written consent of the Parties.
Waiver of any breach of any provision of the Agreement must be in writing signed
by the Party waiving such breach or provision and such waiver shall not be
deemed to be a waiver of any preceding or succeeding breach of the same or any
other provision. The failure of a Party to insist upon strict performance of any
provision of this Agreement or any obligation under this Agreement shall not be
a waiver of such Party's right to demand strict compliance therewith in the
future.
18.4 The headings in this Agreement are inserted for convenience and
identification only and are not intended to describe, interpret, define or limit
the scope, extent or intent of this Agreement or any provision thereof.
18.5 This Agreement may be executed in counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and
the same Agreement.
18.6 This Agreement shall be construed in accordance with the internal
laws of the State of Delaware without reference to the choice of law principles,
except as subject to the United States Arbitration Act and the Federal
Communications Act.
18.7 Except for claims by third parties which fall within the scope of
a Party's indemnification obligations under Section 6.3, neither Party shall be
liable to the other Party for any special, indirect, consequential, or punitive
damages.
18.8 The Parties agree that they will not use the name, service marks
or trademarks of the other party or any of its Affiliates in any advertising,
publicity releases or sales presentations, without such Party's written consent.
Neither Party is licensed hereunder to conduct business under any logo,
trademark, service or trade name (or any derivative thereof) of the other Party.
18.9 No Party shall make any public statement or issue any press
release concerning the terms of this Agreement except as necessary to comply
with requirements of any law, regulation, or the order or judgment of a court or
tribunal of competent jurisdiction. If any such
-22-
<PAGE>
public statement or release is so required, and Dobson and ACC mutually agree
to such statement or release, the Party making such disclosure shall consult
with the other Party prior to making such statement or release and the Party
shall use all reasonable efforts, act in good faith, to agree upon a text for
such statement or release which is satisfactory to Dobson and ACC. Nothing
contained herein is intended to limit the ability of the Parties to make
statements regarding the availability to such Party's Customers of the Services
to be provided hereunder by the other Party or that such other Party is the
provider of such Services.
18.10 Neither of the Parties will be liable for nonperformance or
defective performance of its obligations under this Agreement to the extent and
for such periods of time as such nonperformance or defective performance is due
to reasons outside such Party's control, including, without limitation, acts of
God, war, acts of any governmental authority, riots, revolutions, fire, floods,
explosions, sabotage, nuclear incidents, lightning, weather, earthquakes,
storms, sinkholes, epidemics, strikes, or delays of suppliers or subcontractors
for the same causes. Neither Party shall be required to settle any labor dispute
or other third party dispute in any manner which is deemed by that Party to be
less than totally advantageous, in that Party's sole discretion.
18.11 Except as specifically provided herein, this Agreement is a
non-exclusive arrangement between the Parties and nothing contained in this
Agreement is intended or should be construed to preclude or limit a Party from
obtaining from or providing to a third party Service of a type available or
required to be provided under this Agreement.
-23-
<PAGE>
EXECUTED as of the date first written above.
DOBSON CELLULAR SYSTEMS, INC. ACC ACQUISITION LLC
By: /s/ Everett Dobson By: AT&T Wireless Services JV Co.
-------------------------------- By: /s/ Don Adams
Name: Everett Dobson --------------------------------
Title: President Name: Don Adams
Date: 2/25/00 -----------------------------
------------------------------ Title: Vice President
-----------------------------
Date: 2/25/00
------------------------------
By: Dobson JV Company
By: /s/ Everett Dobson
--------------------------------
Name: Everett Dobson
------------------------------
Title: President
-----------------------------
Date: 2/25/00
------------------------------
-24-
<PAGE>
- --------------------------------------------------------------------------------
DOBSON COMMUNICATIONS CORPORATION
2000 STOCK INCENTIVE PLAN
- --------------------------------------------------------------------------------
<PAGE>
ARTICLE I
Purpose
SECTION 1.01 PURPOSE. This Stock Incentive Plan is established by Dobson
Communications Corporation (the "Company") to create incentives which are
designed to motivate Participants to put forth maximum effort toward the
success and growth of the Company and to enable the Company to attract and
retain experienced individuals who by their position, ability and diligence
are able to make important contributions to the Company's success. Toward
these objectives, the Plan provides for the granting of Options to
Participants on the terms and subject to the conditions set forth in the Plan.
SECTION 1.02 ESTABLISHMENT. The Plan is effective as of January 10, 2000 and
for a period of 10 years from such date. The Plan will terminate on January
9, 2010, however, it will continue in effect until all matters relating to
the payment of Awards and administration of the Plan have been settled.
SECTION 1.03 SHARES SUBJECT TO THE PLAN. Subject to Articles IV, VII and IX
of this Plan, shares of stock covered by Options shall consist of 4,000,000
shares of Common Stock.
SECTION 1.04 SHAREHOLDER APPROVAL. The Plan shall be approved by the holders
of a majority of the outstanding shares of Common Stock, present, or
represented, and entitled to vote at a meeting called for such purposes,
which approval must occur within the period ending twelve months after the
date the Plan is adopted by the Board. Pending such approval by the
shareholders, Awards under the Plan may be granted to Participants, but no
such Awards may be exercised or paid prior to receipt of shareholder
approval. In the event shareholder approval is not obtained within such
twelve-month period, all such Awards shall be void.
ARTICLE II
Definitions
SECTION 2.01 "AFFILIATED ENTITY" means any partnership or limited liability
company, a majority of the partnership or other similar interest thereof is
owned or controlled, directly or indirectly, by the Company or one or more of
its Subsidiaries or Affiliated Entities or a combination thereof. For
purposes hereof, the Company, a Subsidiary or an Affiliated Entity shall be
deemed to have a majority ownership interest in a partnership or limited
liability company if the Company, such Subsidiary or Affiliated Entity shall
be allocated a majority of partnership or limited liability company gains or
losses or shall be or control a managing director or a general partner of
such partnership or limited liability company.
SECTION 2.02 "AWARD" means, individually or collectively, any Option granted
under the Plan to a Participant by the Committee pursuant to such terms,
conditions, restrictions, and/or limitations, if any, as the Committee may
establish by the Award Agreement or otherwise.
SECTION 2.03 "AWARD AGREEMENT" means any written instrument that establishes
the terms, conditions, restrictions, and/or limitations applicable to an
Award in addition to those established by this Plan and by the Committee's
exercise of its administrative powers.
SECTION 2.04 "BOARD" means the Board of Directors of the Company.
SECTION 2.05 "CHANGE OF CONTROL" and "CHANGE OF CONTROL EVENTS" mean the
occurrence of one of the events designated in Section IX.
SECTION 2.06 "CODE" means the Internal Revenue Code of 1986, as amended.
Reference to any Section of the Code shall be deemed to include any
amendments or successor provisions to such Section and any regulations under
such Section.
1
<PAGE>
SECTION 2.07 "COMMITTEE" means the Compensation Committee of the Board, or
such other committee designated by the Board, authorized to administer the
Plan under Article III hereof consisting of not less than two members of the
Board.
SECTION 2.08 "COMMON STOCK" means the Class A Common Stock, par value $0.001
per share, of the Company, and after substitution, such other stock as shall
be substituted therefor as provided in Article VII.
SECTION 2.09 "DATE OF GRANT" means the date on which the granting of an Award
is authorized by the Committee or such later date as may be specified by the
Committee in such authorization.
SECTION 2.10 "DISABILITY" shall have the meaning set forth in Section
22(e)(3) of the Code.
SECTION 2.11 "DIRECTOR" means any person who is a member of the Board.
SECTION 2.12 "ELIGIBLE EMPLOYEE" means any employee of the Company, a
Subsidiary or an Affiliated Entity.
SECTION 2.13 "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
SECTION 2.14 "FAIR MARKET VALUE" means if, at the time an Option is granted
under the Plan, the Company's Common Stock is publicly traded, "fair market
value" shall be determined as of the last business day for which the prices
or quotes discussed in this sentence are available prior to the date such
Option is granted and shall mean (i) the average (on that date) of the high
and low prices of the Common Stock on the principal national securities
exchange on which the Common Stock is traded, if the Common Stock is then
traded on a national securities exchange; or (ii) the last reported sale
price (on that date) of the Common Stock on the NASDAQ National Market, if
the Common Stock is not then traded on a national securities exchange; or
(iii) the closing bid price (or average of bid prices) last quoted (on that
date) by an established quotation service for over-the-counter securities, if
the Common Stock is not reported on the NASDAQ National Market. If the Common
Stock is not publicly traded at the time an Option is granted under the Plan,
"fair market value" shall mean the fair value of the Common Stock as
determined by the Committee after taking into consideration all factors which
it deems appropriate, including, without limitation, recent sale and offer
prices of the Common Stock in private transactions negotiated at arm's length.
SECTION 2.15 "INCENTIVE STOCK OPTION" means an Option within the meaning of
Section 422 of the Code.
SECTION 2.16 "NONQUALIFIED STOCK OPTION" means an Option which is not an
Incentive Stock Option.
SECTION 2.17 "OPTION" means an Award granted under Article VI of the Plan.
SECTION 2.18 "PARTICIPANT" means a Director, an Eligible Employee or an
independent contractor to whom an Award has been granted by the Committee
under the Plan.
SECTION 2.19 "PLAN" means this Dobson Communications Corporation 2000 Stock
Incentive Plan.
SECTION 2.20 "SUBSIDIARY" shall have the same meaning set forth in Section
424 of the Code.
ARTICLE III
Administration
SECTION 3.01 ADMINISTRATION BY COMMITTEE. The Committee shall administer the
Plan. Unless otherwise provided in the by-laws of the Company or the
resolutions adopted from time to time by the Board establishing the
Committee, the Board may from time to time remove members from, or add
members to, the Committee. Vacancies on the Committee, however caused, shall
be filled by the Board. The Committee shall hold meetings at such times and
places as it may determine. A majority of
2
<PAGE>
the Committee shall constitute a quorum, and the acts of a majority of the
members present at any meeting at which a quorum is present or acts reduced
to or approved in writing by a majority of the members of the Committee shall
be the valid acts of the Committee.
Subject to the provisions of the Plan, the Committee shall have
exclusive power to:
(a) Select the Participants to be granted Awards.
(b) Determine the time or times when Awards will be made.
(c) Determine the form of an Award, the number of shares of Common
Stock subject to the Award, all the terms, conditions (including performance
requirements), restrictions and/or limitations, if any, of an Award,
including the time and conditions of exercise or vesting, and the terms of
any Award Agreement, which may include the waiver or amendment of prior terms
and conditions or acceleration or early vesting or payment of an Award under
certain circumstances determined by the Committee.
(d) Determine whether Awards will be granted singly or in
combination.
(e) Accelerate the vesting, exercise or payment of an Award or the
performance period of an Award when such action or actions would be in the
best interest of the Company.
(f) Take any and all other action it deems necessary or advisable
for the proper operation or administration of the Plan.
SECTION 3.02 COMMITTEE TO MAKE RULES AND INTERPRET PLAN. The Committee in its
sole discretion shall have the authority, subject to the provisions of the
Plan, to establish, adopt, or revise such rules and regulations and to make
all such determinations relating to the Plan as it may deem necessary or
advisable for the administration of the Plan. The Committee's interpretation
of the Plan or any Awards granted pursuant thereto and all decisions and
determinations by the Committee with respect to the Plan shall be final,
binding, and conclusive on all parties.
ARTICLE IV
Grant of Awards
SECTION 4.01 COMMITTEE TO GRANT AWARDS. The Committee may, from time to time,
grant Awards to one or more Participants, provided, however, that:
(a) Subject to Article VII, the aggregate number of shares of Common
Stock made subject to the Award of Options to any Participant in any fiscal
year of the Company may not exceed 100,000.
(b) Any shares of Common Stock related to Awards which terminate by
expiration, forfeiture, cancellation or otherwise without the issuance of
shares of Common Stock shall be available again for grant under the Plan.
(c) Common Stock delivered by the Company in payment of any Award
under the Plan may be authorized and unissued Common Stock or Common Stock
held in the treasury of the Company.
(d) The Committee shall, in its sole discretion, determine the
manner in which fractional shares arising under this Plan shall be treated.
(e) Separate certificates representing Common Stock to be delivered
to a Participant upon the exercise of any Option will be issued to such
Participant.
3
<PAGE>
ARTICLE V
Eligibility
Subject to the provisions of the Plan, the Committee shall, from
time to time, select from the Eligible Employees and Directors to whom Awards
shall be granted and shall determine the type or types of Awards to be made
and shall establish in the related Award Agreements the terms, conditions,
restrictions and/or limitations, if any, applicable to the Awards in addition
to those set forth in the Plan and the administrative rules and regulations
issued by the Committee. The Committee may also grant Nonqualified Stock
Options to independent contractors who provide services to the Company, a
Subsidiary or and Affiliated Entity.
ARTICLE VI
Stock Options
SECTION 6.01 GRANT OF OPTIONS. The Committee may, from time to time, subject
to the provisions of the Plan and such other terms and conditions as it may
determine, grant Options to Participants. These Options may be Incentive
Stock Options or Nonqualified Stock Options, or a combination of both. Each
grant of an Option shall be evidenced by an Award Agreement executed by the
Company and the Participant, and shall contain such terms and conditions and
be in such form as the Committee may from time to time approve, subject to
the requirements of Section 6.02.
SECTION 6.02 CONDITIONS OF OPTIONS. Each Option so granted shall be subject
to the following conditions:
(a) EXERCISE PRICE. As limited by Section 6.02(e) below, each Option
shall state the exercise price which shall be set by the Committee at the
Date of Grant; provided, however, no Nonqualified Stock Option shall be
granted at an exercise price which is less than 75% of the Fair Market Value
of the Common Stock on the Date of Grant.
(b) MEANS OF EXERCISING OPTIONS. An Option (or any part of
installment thereof) shall be exercised by giving written notice to the
Company at its principal office address, or to such transfer agent as the
Company shall designate. Such notice shall identify the Option being
exercised and specify the number of shares as to which such Option is being
exercised, accompanied by (i) an instrument of accession providing that the
Participant agrees to be bound by the terms, rights and obligations
applicable to "Shareholders" under that certain Shareholders' Agreement dated
as of March 19, 1996, by and among the Company and its stockholders signatory
thereto, as amended from time to time; provided, this requirement shall not
be applicable after the Company has completed the initial public offering of
its Class A Voting Common Stock, and (ii) full payment of the purchase price
therefor either (a) in United States dollars in cash or by check, (b) at the
discretion of the Committee, through delivery of shares of Common Stock
having a fair market value equal as of the date of the exercise to the cash
exercise price of the Option including withholding of shares of Common Stock
otherwise deliverable upon exercise of an Option, but only to the extent such
exercise of an Option would not result in an accounting compensation charge
with respect to the shares used to pay the exercise price unless otherwise
determined by the Committee, (c) at the discretion of the Committee, by
delivery of the grantee's personal recourse note bearing interest payable not
less than annually at no less than 100% of the lowest applicable Federal
rate, as defined in Section 1274(d) of the Code, (d) at the discretion of the
Committee and consistent with applicable law, through the delivery of an
assignment to the Company of a sufficient amount of the proceeds from the
sale of the Common Stock acquired upon exercise of the Option and an
authorization to the broker or selling agent to pay that amount to the
Company, which sale shall be at the participant's direction at the time of
exercise, or (e) at the discretion of the Committee, by any combination of
(a), (b), (c) and (d) above. If the Committee exercises its discretion to
permit payment of the exercise price of an Option by means of the methods set
forth in clauses (b), (c), (d) or (e) of the preceding sentence, such
discretion shall be exercised in writing at the time of the grant of the
Option in question. The holder of an Option shall not have the rights of a
shareholder with respect to the shares covered by such Option until the date
of issuance of a stock certificate to such holder for such shares. Except as
expressly provided above in Article VII with respect to changes
4
<PAGE>
in capitalization and stock dividends, no adjustment shall be made for
dividends or similar rights for which the record date is before the date such
stock certificate is issued.
(c) EXERCISE OF OPTIONS. Options granted under the Plan shall be
exercisable, in whole or in such installments and at such times, and shall
expire at such time, as shall be provided by the Committee in the Award
Agreement. Exercise of an Option shall be by written notice stating the
election to exercise in the form and manner determined by the Committee.
Every share of Common Stock acquired through the exercise of an Option shall
be deemed to be fully paid at the time of exercise and payment of the
exercise price.
(d) OTHER TERMS AND CONDITIONS. Among other conditions that may be
imposed by the Committee, if deemed appropriate, are those relating to (i)
the period or periods and the conditions of exercisability of any Option;
(ii) the minimum periods during which Participants must be employed by the
Company, its Subsidiaries or an Affiliated Entity, or must hold Options
before they may be exercised; (iii) the minimum periods during which shares
acquired upon the exercise of Options must be held before sale or transfer
shall be permitted; (iv) conditions under which Options or shares may be
subject to forfeiture; (v) the frequency of exercise or the minimum or
maximum number of shares that may be acquired at any one time and (vi) the
achievement by the Company of specified performance criteria.
(e) SPECIAL RESTRICTIONS RELATING TO INCENTIVE STOCK OPTIONS.
Options issued in the form of Incentive Stock Options shall only be granted
to Eligible Employees of the Company or a Subsidiary and shall not be granted
to Directors who are not also Eligible Employees of the Company or a
Subsidiary and shall, in addition to being subject to all applicable terms,
conditions, restrictions and/or limitations established by the Committee,
comply with the requirements of Section 422 of the Code (or any successor
Section thereto), including, without limitation, the requirement that the
exercise price of an Incentive Stock Option not be less than 100% of the Fair
Market Value of the Common Stock on the Date of Grant, the requirement that
each Incentive Stock Option, unless sooner exercised, terminated or
cancelled, expire no later than 10 years from its Date of Grant, and the
requirement that the aggregate Fair Market Value (determined on the Date of
Grant) of the Common Stock with respect to which Incentive Stock Options are
exercisable for the first time by a Participant during any calendar year
(under this Plan or any other plan of the Company, its parent or any
Subsidiary) not exceed $100,000. Incentive Stock Options which are in excess
of the applicable $100,000 limitation will be automatically recharacterized
as Nonqualified Stock Options as provided under Section 6.03 of this Plan. No
Incentive Stock Options shall be granted to any Eligible Employee if,
immediately before the grant of an Incentive Stock Option, such Eligible
Employee owns more than 10% of the total combined voting power of all classes
of stock of the Company or its Subsidiaries (as determined in accordance with
the stock attribution rules contained in Sections 422 and 424(d) of the
Code). Provided, the preceding sentence shall not apply if, at the time the
Incentive Stock Option is granted, the exercise price is at least 110% of the
Fair Market Value of the Common Stock subject to the Incentive Stock Option,
and such Incentive Stock Option by its terms is exercisable no more than five
years from the date such Incentive Stock Option is granted.
(f) SHAREHOLDER RIGHTS. No Participant shall have a right as a
shareholder with respect to any share of Common Stock subject to an Option
prior to purchase of such shares of Common Stock by exercise of the Option.
SECTION 6.03 OPTIONS NOT QUALIFYING AS INCENTIVE STOCK OPTIONS. With respect
to all or any portion of any Option granted under this Plan not qualifying as
an "incentive stock option" under Section 422 of the Code, such Option shall
be considered as a Nonqualified Stock Option granted under this Plan for all
purposes. This Plan and any Incentive Stock Options granted hereunder shall
be deemed to have incorporated by reference all the provisions and
requirements of Section 422 of the Code (and the Treasury Regulations issued
thereunder) which are required to provide that all Incentive Stock Options
granted hereunder shall be "incentive stock options" described in Section 422
of the Code. Further, in the event that the Committee grants Incentive Stock
Options under this Plan to a Participant, and, in the event that the
applicable limitation contained in Section 6.02(e) herein is exceeded, then,
such Incentive Stock Options in excess of such limitation shall be treated as
Nonqualified Stock Options under this Plan subject to the terms and
provisions of the applicable Award Agreement, except to the extent modified
to reflect recharacterization of the Incentive Stock Options as Nonqualified
Stock Options.
5
<PAGE>
ARTICLE VII
Stock Adjustments
In the event that the shares of Common Stock, as presently
constituted, shall be changed into or exchanged for a different number or
kind of shares of stock or other securities of the Company or of another
corporation (whether by reason of merger, consolidation, recapitalization,
reclassification, stock split, combination of shares or otherwise), or if the
number of such shares of Common Stock shall be increased through the payment
of a stock dividend, or a dividend on the shares of Common Stock or rights or
warrants to purchase securities of the Company shall be made, then there
shall be substituted for or added to each share available under and subject
to the Plan as provided in Section 1.03 hereof, and each share theretofore
appropriated or thereafter subject or which may become subject to Options
under the Plan, the number and kind of shares of stock or other securities
into which each outstanding share of Common Stock shall be so changed or for
which each such share shall be exchanged or to which each such share shall be
entitled, as the case may be, on a fair and equivalent basis in accordance
with the applicable provisions of Section 424 of the Code; provided, however,
with respect to Options, in no such event will such adjustment result in a
modification of any Option as defined in Section 424(h) of the Code. In the
event there shall be any other change in the number or kind of the
outstanding shares of Common Stock, or any stock or other securities into
which the Common Stock shall have been changed or for which it shall have
been exchanged, then if the Committee shall, in its sole discretion,
determine that such change equitably requires an adjustment in the shares
available under and subject to the Plan, or in any Award theretofore granted
or which may be granted under the Plan, such adjustments shall be made in
accordance with such determination, except that no adjustment of the number
of shares of Common Stock available under the Plan or to which any Award
relates that would otherwise be required shall be made unless and until such
adjustment either by itself or with other adjustments not previously made
would require an increase or decrease of at least 1% in the number of shares
of Common Stock available under the Plan or to which any Award relates
immediately prior to the making of such adjustment (the "Minimum
Adjustment"). Any adjustment representing a change of less than such minimum
amount shall be carried forward and made as soon as such adjustment together
with other adjustments required by this Article VII and not previously made
would result in a Minimum Adjustment. Notwithstanding the foregoing, any
adjustment required by this Article VII which otherwise would not result in a
Minimum Adjustment shall be made with respect to shares of Common Stock
relating to any Award immediately prior to exercise, payment or settlement of
such Award.
No fractional shares of Common Stock or units of other securities
shall be issued pursuant to any such adjustment, and any fractions resulting
from any such adjustment shall be eliminated in each case by rounding
downward to the nearest whole share.
ARTICLE VIII
General
SECTION 8.01 AMENDMENT OR TERMINATION OF PLAN. The Board may suspend or
terminate the Plan at any time. In addition, the Board may, from time to
time, amend the Plan in any manner, but may not without shareholder approval
adopt any amendment which would increase the aggregate number of shares of
Common Stock available under the Plan (except by operation of Article VII);
provided, that any amendment to the Plan shall require approval of the
shareholders if, in the opinion of counsel to the Company, such approval is
required by any Federal or state law or any regulations or rules promulgated
thereunder.
SECTION 8.02 DIVIDENDS AND DIVIDEND EQUIVALENTS. The Committee may choose, at
the time of the grant of any Award or any time thereafter up to the time of
payment of such Award, to include as part of such Award an entitlement to
receive dividends or dividend equivalents subject to such terms, conditions,
restrictions, and/or limitations, if any, as the Committee may establish.
Dividends and dividend equivalents granted hereunder shall be paid in such
form and manner (i.e., lump sum or installments), and at such time as the
Committee shall determine. All dividends or dividend equivalents which are
not paid currently may, at the Committee's discretion, accrue interest or be
reinvested into additional shares of Common Stock.
6
<PAGE>
SECTION 8.03 ACCELERATION OF OTHERWISE UNEXERCISABLE OPTIONS ON DEATH,
DISABILITY OR OTHER SPECIAL CIRCUMSTANCES. The Committee, in its sole
discretion, may permit (i) a Participant who terminates employment due to a
Disability, (ii) the personal representative of a deceased Participant, or
(iii) any other Participant who terminates employment upon the occurrence of
special circumstances (as determined by the Committee) to purchase all or any
part of the shares subject to any unvested Award on the date of the
Participant's Disability, death, or as the Committee otherwise so determines.
With respect to Awards which have already vested at the date of such
termination or the vesting of which is accelerated by the Committee in
accordance with the foregoing provision, the Participant or the personal
representative of a deceased Participant shall automatically have the right
to exercise such vested Awards within three months of such date of
termination of employment or one year in the case of a Participant suffering
a Disability or three years in the case of a deceased Participant.
SECTION 8.04 LIMITED TRANSFERABILITY. The Committee may, in its discretion,
authorize all or a portion of the Nonqualified Stock Options to be granted
under this Plan to be on terms which permit transfer by the Participant to
(i) the ex-spouse of the Participant pursuant to the terms of a domestic
relations order, (ii) the spouse, children or grandchildren of the
Participant ("Immediate Family Members"), (iii) a trust or trusts for the
exclusive benefit of such Immediate Family Members, or (iv) a partnership in
which such Immediate Family Members are the only partners. In addition (x)
there may be no consideration for any such transfer, (y) the Award Agreement
pursuant to which such Nonqualified Stock Options are granted must be
approved by the Committee, and must expressly provide for transferability in
a manner consistent with this Section, and (z) subsequent transfers of
transferred Nonqualified Stock Options shall be prohibited except as set
forth below in this Section 8.04. Following transfer, any such Nonqualified
Stock Options shall continue to be subject to the same terms and conditions
as were applicable immediately prior to transfer, provided that for purposes
of Section 8.03 hereof the term "Participant" shall be deemed to refer to the
transferee. The events of termination of employment of Section 8.03 hereof
shall continue to be applied with respect to the original Participant,
following which the Options shall be exercisable by the transferee only to
the extent, and for the periods specified in Section 8.03 hereof. No transfer
pursuant to this Section 8.04 shall be effective to bind the Company unless
the Company shall have been furnished with written notice of such transfer
together with such other documents regarding the transfer as the Committee
shall request. In addition, Options shall be transferable by will or the laws
of descent and distribution; however, no such transfer of an Option by the
Participant shall be effective to bind the Company unless the Company shall
have been furnished with written notice of such transfer and an authenticated
copy of the will and/or such other evidence as the Committee may deem
necessary to establish the validity of the transfer and the acceptance by the
transferee of the terms and conditions of such Option.
SECTION 8.05 WITHHOLDING TAXES. A Participant must pay the amount of taxes
required by law upon the exercise or payment of an Award (i) in cash, (ii) at
the discretion of the Committee, by delivering to the Company shares of
Common Stock having a Fair Market Value on the date of payment equal to the
amount of such required withholding taxes, or (iii) a combination of the
foregoing.
SECTION 8.06 AMENDMENTS TO AWARDS. The Committee may at any time unilaterally
amend the terms of any Award Agreement, whether or not presently exercisable,
earned, paid or vested, to the extent it deems appropriate, including by
example and not by limitation, the acceleration of vesting of Awards;
provided, however, that any such amendment which is adverse to the
Participant shall require the Participant's consent.
SECTION 8.07 SECURITIES LAWS. The Company shall have no obligation to issue
or deliver certificates representing shares of Common Stock subject to Awards
if such issuance or delivery would violate any federal or state securities or
other laws or prior to:
(a) the obtaining of any approval from, or satisfaction of any
waiting period or other condition imposed by, any governmental agency which
the Committee shall, in its sole discretion, determine to be necessary or
advisable; and
(b) the completion of any registration or other qualification of
such shares under any state or Federal law or ruling of any governmental body
which the Committee shall, in its sole discretion, determine to be necessary
or advisable.
7
<PAGE>
SECTION 8.08 RIGHT TO CONTINUED EMPLOYMENT. Participation in the Plan shall
not give any Director any right to remain a Director of the Company or any
Eligible Employee any right to remain in the employ of the Company, any
Subsidiary or any Affiliated Entity. The adoption of this Plan shall not be
deemed to give any Director, Eligible Employee or any other individual any
right to be selected as a Participant or to be granted an Award.
SECTION 8.09 RELIANCE ON REPORTS. Each member of the Committee and each
member of the Board shall be fully justified in relying or acting in good
faith upon any report made by the independent public accountants of the
Company and its Subsidiaries and upon any other information furnished in
connection with the Plan by any person or persons other than himself. In no
event shall any person who is or shall have been a member of the Committee or
of the Board be liable for any determination made or other action taken or
any omission to act in reliance upon any such report or information or for
any action taken, including the furnishing of information, or failure to act,
if in good faith.
SECTION 8.10 CONSTRUCTION. Masculine pronouns and other words of masculine
gender shall refer to both men and women.
SECTION 8.11 GOVERNING LAW. The Plan shall be governed by and construed in
accordance with the laws of the State of Oklahoma except as superseded by
applicable Federal law.
ARTICLE IX
Change in Control
In the event any Change in Control Event (as defined below) occurs,
each Option then outstanding shall, immediately prior to such Change in
Control Event, be nonforfeitable and exercisable in full. A Change in Control
Event shall mean any of the following:
(i) Any transaction in which shares of voting securities of the
Company are sold or transferred by the Company or shareholders of
the Company as a result of which those persons and entities who own
voting securities of the Company prior to such transaction own less
than fifty percent (50%) of the outstanding voting securities of the
Company after such transaction;
(ii) The merger or consolidation of the Company with or into another
entity as a result of which less than fifty percent (50%) of the
outstanding voting securities of the surviving or resulting entity are
beneficially owned by those persons and entities who beneficially own
voting securities of the Company prior to such merger or consolidation;
or
(iii) The sale of all or substantially all of the Company's assets to
an entity of which less than fifty percent (50%) of the outstanding
voting securities of such entity are beneficially owned by those
persons and entities who own voting securities of the Company at the
time of such asset sale.
ARTICLE X
Acceleration of Options on Corporate Event
If the Company shall, pursuant to action by the Board, at any time propose to
dissolve or liquidate or merge into, consolidate with, or sell or otherwise
transfer all or substantially all of its assets to another corporation
("Transaction") and provision is not made pursuant to the terms of such
Transaction for the assumption by the surviving, resulting or acquiring
corporation of outstanding Options under the Plan, or for the substitution of
new
8
<PAGE>
options therefor, the Committee shall cause written notice of the proposed
Transaction to be given to each Participant no less than forty days prior to
the anticipated effective date of the proposed Transaction, and his Option
shall become 100% vested and, prior to a date specified in such notice, which
shall be not more than ten days prior to the anticipated effective date of
the proposed Transaction, each Participant shall have the right to exercise
his Option to purchase any or all of the Common Stock then subject to such
Option. Each Participant, by so notifying the Company in writing, may, in
exercising his Option, condition such exercise upon, and provide that such
exercise shall become effective at the time of, but immediately prior to, the
consummation of the Transaction, in which event such Participant need not
make payment for the Common Stock to be purchased upon exercise of such
Option until five days after written notice by the Company to such
Participant that the Transaction has been consummated. If the Transaction is
consummated, each Option, to the extent not previously exercised prior to the
date specified in the foregoing notice, shall terminate on the effective date
of such consummation. If the Transaction is abandoned, (i) any Common Stock
not purchased upon exercise of such Option shall continue to be available for
purchase in accordance with the other provisions of the Plan and (ii) to the
extent that any Option not exercised prior to such abandonment shall have
vested solely by operation of this Article X, such vesting shall be deemed
annulled, and the vesting schedule set forth in the Participant's Option
Agreement shall be reinstituted, as of the date of such abandonment.
9
<PAGE>
Exhibit 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Dobson Communications
Corporation (Dobson) Form 8-K disclosing Dobson's investment in a joint
venture which purchased American Cellular Corporation, of our report dated
March 15, 1999, with respect to the consolidated financial statements of
American Cellular Corporation, and our report dated March 15, 1999, with
respect to the consolidated financial statements of PriCellular Corporation,
both of which are included in the American Cellular Corporation Annual Report
(Form 10-K) for the period December 31, 1998, filed with the Securities and
Exchange Commission.
/s/ Ernst & Young LLP
Chicago, Illinois
March 8, 2000
