CROWN ATLANTIC COMPANY LLC
FIRST AMENDMENT TO OPERATING AGREEMENT
THIS FIRST AMENDMENT TO OPERATING AGREEMENT (this “ First Amendment ”) is made and entered into as of May 1, 2003 (the “ Effective Date ”) by Crown Atlantic Company LLC, a Delaware limited liability company (“ OpCo ” or the “ Company ”), and each of Bell Atlantic Mobile Inc., a Delaware corporation (“ BAM ”), and Crown Atlantic Holding Sub LLC, a Delaware limited liability company (“ HoldCo Sub ”) (BAM and HoldCo Sub being hereinafter sometimes referred to individually as a “Member” and collectively as the “Members”).
WHEREAS, Cellco Partnership and HoldCo Sub entered into that certain Operating Agreement dated as of March 31, 1999 (the “ Operating Agreement ”);
WHEREAS, Cellco Partnership previously transferred to BAM all of Cellco Partnership’s Membership Interest and Percentage Interest in the Company; and
WHEREAS, the Members desire to amend the Operating Agreement as set forth herein.
NOW THEREFORE, for and in consideration of the mutual benefits to be derived, the promises and agreements herein contained, other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:
1. Limited Distributions on BAM Retained Interest .
(a) Notwithstanding any provisions of the Operating Agreement to the contrary (including, without limitation, any of the provisions of Sections 6.8, 6.9, 6.10, 7.1 and 9.5(a) of the Operating Agreement), except as set forth in Section 1(b) below, BAM shall not be entitled to any distribution or allocation of any type whatsoever on account of or in respect of the BAM Retained Interest. Without limiting the generality of the foregoing, BAM shall not be entitled to any of the following distributions or allocations on account of or in respect of the BAM Retained Interest: (i) allocations of Profits and Losses under Sections 6.8 or 6.9 of the Operating Agreement; (ii) allocations under Section 6.10 of the Operating Agreement; (iii) distributions of Net Cash From Operations under Section 7.1 of the Operating Agreement; or (iv) distribution of assets under Section 9.5(a) of the Operating Agreement. Nothing in this Section 1(a) shall be construed as limiting in any manner the rights of BAM under Section 9.5(b) of the Operating Agreement.
(b) As BAM’s sole return on account of or in respect of the BAM Retained Interest, effective as of May 1, 2003, BAM shall be entitled to receive an annual guaranteed payment in the amount of $10,000.00, payable by the Company to BAM within 90 days after the end of each fiscal year of the Company. Such amount shall be pro rated for any partial year based upon the actual number of days in the applicable year. The annual guaranteed payments to be made by the Company to BAM under this Section 1(b) on account of and in respect of the BAM Retained Interest are intended to constitute “guaranteed payments” within the meaning of Section 707(c) of the IRC.
2. Modification of Certain Approval Rights .
(a) Section 3.8(j) of the Operating Agreement is hereby amended and restated in its entirety as follows:
“(j) Merger or Sale of Assets .
(1) Any merger or consolidation by the Company with any Person. Any sale, assignment, lease or other disposition by the Company of (whether in one transaction or in a series of transactions), or any voluntarily parting with the control of (whether in one transaction or in a series of transactions), a material portion of the Company’s assets (whether now owned or hereinafter acquired), except (A) in accordance with the provisions of any of the Transaction Documents, (B) in accordance with the following provisions of this subsection (1), and (C) for sales or other dispositions of assets in the ordinary course of business. The Company shall have the right to sell, assign, lease or otherwise dispose of any Tower Site, and the Tower Structures located on such Tower Site, so long as (i) neither BAM, any of the Transferring Partnerships nor any Affiliate of BAM (including, without limitation, Cellco Partnership or any of its direct or indirect subsidiaries) has any interest in or to such Tower Site or Tower Structures under the Global Lease Agreement or any Supplement (as defined in the Global Lease Agreement), (ii) at the same time that the Company sells, assigns, leases or dispose of such Tower Site and Tower Structures, the Company shall sell, assign, transfer or otherwise dispose of all obligations of the Company that relate to such Tower Site or Tower Structures including, without limitation, all obligations of the Company under any lease, sublease, contract or other agreement, oral or written, that relate to such Tower Site or Tower Structures, and (iii) the Company shall secure, effective as of the time that the Company sells, assigns, leases or dispose of such Tower Site and Tower Structures, a proportionate reduction in the amounts payable by the Company under the Bidder Services Agreement to reflect the reduction in Standard Services (as defined in the Bidder Services Agreement) received by the Company as a result of the sale, assignment, lease or disposal of such Tower Site and Tower Structures (the percentage by which such amounts payable by the Company are to be reduced shall be determined by dividing (x) the number of Tower Sites then being sold, assigned, leased or disposed of by the Company by (y) the total number of Tower Sites of the Company immediately prior to the sale, assignment, lease or disposal of the subject Tower Sites by the Company).
(2) Any sale, assignment or other disposition of (whether in one transaction or in a series of transactions) any of the Company’s accounts receivable (whether now in existence or hereinafter created) at a discount or with recourse, to any Person, except for sales or other dispositions of assets in the ordinary course of business, or except as permitted under the terms of the Global Lease Agreement.”
(b) Section 3.8(n) of the Operating Agreement is hereby amended and restated in its entirety as follows:
“(n) Business Plan . The approval of a Business Plan under Section 10.3(b).”
(c) Section 10.3 of the Operating Agreement is hereby amended and restated in its entirety as follows:
“Section 10.3 Business Plans .
(a) On or before November 30 of each year, the Managers of the Company shall develop a business plan and budget for the Company (including HoldCo and HoldCo Sub) (the “ Business Plan ”) for the following calendar year of HoldCo (and HoldCo Sub and OpCo), and submit such Business Plan to BAM and CCIC for review. If a Business Plan