Exhibit 10.137

 

**** CONFIDENTIAL PORTION has been omitted pursuant to a request for
confidential treatment by the Company to, and the material has been separately
filed with, the SEC. Each omitted Confidential Portion is marked by four
asterisks.

 

 

 

 

SECOND AMENDED AND RESTATED

OPERATING AGREEMENT

 

OF

 

ALASKA DIGITEL, LLC

 

January 1, 2007

 

 

 

THE UNITS IN THIS LIMITED LIABILITY COMPANY HAVE NOT BEEN REGISTERED WITH THE
SECURITIES AND EXCHANGE COMMISSION OR STATE SECURITIES AUTHORITIES AND MAY NOT
BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE
SECURITIES LAWS OR AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT
REGISTRATION IS NOT REQUIRED. THE SALE OR OTHER TRANSFER OF THE UNITS IS ALSO
RESTRICTED BY PROVISIONS OF THIS AGREEMENT.

TABLE OF CONTENTS

 

Page

 

ARTICLE 1.

FORMATION AND DEFINITIONS

1

1.1

Formation.

1

1.2

Name.

1

1.3

Members and Units.

1

1.4

Office and Agent.

1

1.5

Foreign Qualification.

2

1.6

Term.

2

1.7

Effective Date; Amendment and Restatement.

2

1.8

Definitions.

2

ARTICLE 2.

PURPOSES AND POWERS

11

2.1

Principal Purposes.

11

2.2

Other Purposes.

11

2.3

Powers.

11

ARTICLE 3.

UNITS

11

3.1

Classes of Units.

11

3.2

Common Units.

11

3.3

Profits Interest Units.

12

3.4

Code Section 83(b) Election and Safe Harbor.

13

3.5

Reacquired Units.

14

3.6

Certificates.

14

ARTICLE 4.

CAPITAL OF THE COMPANY

15

4.1

Initial Contributions.

15

4.2

Additional Contributions

16

4.3

Capital Accounts.

16

4.4

Adjustments.

16

4.5

Transfer.

17

4.6

Market Value Adjustments.

17

4.7

No Withdrawal of Capital.

17

4.8

No Interest on Capital.

17

4.9

No Drawing Accounts.

17

ARTICLE 5.

PROFITS AND LOSSES

17

5.1

Determination.

17

5.2

Allocation of Profits and Losses Generally.

17

5.3

Nonrecourse Deductions.

18

5.4

Minimum Gain Chargeback.

18

5.5

Tax Allocations.

18

5.6

Qualified Income Offset.

18

5.7

Limit on Loss Allocations.

19

5.8

§ 754 Adjustments.

19

5.9

Contributed Property.

19

5.10

Tax Credits.

19

5.11

Gross Income Allocation.

20

5.12

Curative Allocations.

20

5.13

Allocation on Transfer.

20

ARTICLE 6.

DISTRIBUTIONS

21

6.1

Distributions Generally.

21

6.2

Payment.

21

6.3

Withholding.

21

6.4

Distribution Limitations.

21

6.5

Tax Distribution.

21

ARTICLE 7.

MANAGEMENT

22

7.1

Management

22

7.2

Appointment of Board of Managers

23

7.3

Procedural Requirements

23

7.4

Officers.

26

7.5

Annual Budget.

26

7.6

Curative Provision.

27

ARTICLE 8.

LIABILITY OF A MEMBER

27

8.1

Limited Liability.

27

8.2

Capital Contribution.

27

8.3

Capital Return.

27

8.4

Reliance.

28

ARTICLE 9.

INDEMNIFICATION

28

9.1

General.

28

9.2

Exception.

28

9.3

Expense Advancement.

28

9.4

Insurance.

29

9.5

Indemnification of Others.

29

9.6

Exculpation.

29

9.7

Rights Not Exclusive.

29

ARTICLE 10.

ACCOUNTING AND REPORTING

29

10.1

Fiscal Year.

29

10.2

Tax Accounting Method.

29

10.3

Tax Elections.

29

10.4

Returns.

30

10.5                          Reports; Annual Financial Statements; Regulatory
Reporting Obligations.                                          
                                           30

10.6

Books and Records.

30

10.7

Information.

31

10.8

Banking.

31

10.9

Tax Matters; Tax Matters Partner.

31

10.10

Classification of Company as Partnership for Tax Purposes, Not State Law.

32

ARTICLE 11.

DISSOLUTION

32

11.1

Dissolution.

32

11.2

Events of Withdrawal.

33

11.3

Continuation.

33

ARTICLE 12.

LIQUIDATION

34

12.1

Liquidation.

34

12.2

[Reserved].

34

12.3

Priority of Payment.

34

12.4

Liquidating Distributions.

35

12.5

No Restoration Obligation.

35

12.6

Timing.

35

12.7

Liquidating Reports.

35

12.8

Articles of Dissolution.

35

ARTICLE 13.

TRANSFER RESTRICTIONS

36

13.1

General Rule.

36

13.2

Permitted Transfers.

36

13.3

Permitted Pledges.

36

13.4

General Conditions on Transfer.

36

13.5

Rights of Transferees.

37

ARTICLE 14.

LIQUIDITY RIGHTS

37

14.1

Call Rights.

37

14.2

Put Rights.

38

14.3

Determination of Appraised Unit Value.

38

14.4

Closing Procedures.

40

ARTICLE 15.

CERTAIN BUSINESS MATTERS

41

15.1

Distribution of Assets in Kind.

41

15.2

Other Business Ventures.

41

15.3

Confidentiality.

41

ARTICLE 16.

GENERAL PROVISIONS

42

16.1

Amendment.

42

16.2

Representations.

43

16.3

Unregistered Interests.

43

16.4

Waiver of Alternative Withdrawal Rights.

44

16.5

Waiver of Partition Right.

44

16.6

Waivers Generally.

44

16.7

Equitable Relief.

44

16.8

Arbitration.

44

16.9

Remedies for Breach.

45

16.10

Costs.

45

16.11

Counterparts.

45

16.12

Notice.

45

16.13

Deemed Notice.

45

16.14

Partial Invalidity.

45

16.15

Entire Agreement.

46

16.16

Benefit.

46

16.17

Further Assurances.

46

16.18

Headings.

46

16.19

Terms.

46

16.20

Governing Law.

46

16.21

No Tax Advice.

46

 

 

SECOND AMENDED AND RESTATED OPERATING AGREEMENT

 

OF

 

ALASKA DIGITEL, LLC

 

This Second Amended and Restated Operating Agreement is made as of the 1st day
of January, 2007 (the “Effective Date”), by and among General Communication,
Inc., an Alaska corporation (“GCI”), Pacificom Holdings II, LLC, a Delaware
limited liability company and the successor-in-interest by merger to Pacificom
Holdings, L.L.C. (“Pacificom”), Red River Wireless, LLC, a Delaware limited
liability company (“Red River”), AKD Holdings, LLC, a Delaware limited liability
company (“AKD Holdings”) and Fire Lake Partners, L.L.C., an Alaska limited
liability company (“Fire Lake”), such parties being all of the Members of Alaska
Digitel, LLC, an Alaska limited liability company (the “Company”), on the
Effective Date.

In consideration of the mutual covenants contained in this Agreement and
intending to be legally bound, the parties agree as follows:

 

ARTICLE 1.

FORMATION AND DEFINITIONS

1.1          Formation. The Company was formed on September 17, 1996 by filing
Articles of Organization with the Alaska Department of Commerce, Community, and
Economic Development under the Act.

1.2          Name. The name of the Company is Alaska Digitel, LLC. The business
of the Company will be conducted under such name, and any other name or names as
the Company may from time to time determine.

1.3          Members and Units. The name and address of each Member and its
number of Units held as of the Effective Date are set forth in Schedule 1.3.

1.4

Office and Agent.

[a]          The registered office of the Company in Alaska is 508 West 2nd
Avenue, Third Floor, Anchorage, Alaska 99501 and its registered agent is John H.
Tindall. The Company may change its registered office or registered agent in
Alaska in accordance with the Act.

[b]          The principal office of the Company is at 3127 Commercial Drive,
Anchorage, Alaska 99501. The Company may change its principal office upon the
affirmative Vote of Members owning more than 50% of the outstanding Units.

1.5          Foreign Qualification. The Company will apply for a certificate of
authority to do business in any other state or jurisdiction, as required or
appropriate from time to time, and will file such other certificates and
instruments as may be required or appropriate from time to time in connection
with its formation, existence and operation.

1.6          Term. The Company became effective as a limited liability company
on the date its Articles of Organization were filed with the Alaska Department
of Commerce, Community, and Economic Development and will continue in effect,
unless and until a Dissolution occurs and Articles of Dissolution are filed in
accordance with the Act.

1.7          Effective Date; Amendment and Restatement. This Agreement will
become effective on the Effective Date and as of such date, amends and restates
in its entirety the Amended and Restated Operating Agreement of the Company
dated March 31, 2004, as amended by amendments dated April 7, 2004, January 9,
2006 and [ ], 2006 (as amended, the “Former Operating Agreement”), which shall
be null, void and of no further force or effect.

1.8          Definitions. The following terms used in this Agreement have the
corresponding meanings set forth below:

Act:

the Alaska Revised Limited Liability Company Act, as amended from time to time.

Additional Contribution:

a capital contribution (other than the Initial Contribution) that a Member makes
to the Company with respect to any Units issued to such Member, as described in
Section 4.2.

Adjusted Capital Account Deficit:

as to any Member, the deficit balance (if any) in such Member’s Capital Account
as of the end of the Fiscal Year, after [a] crediting to such Capital Account
any amount that such Member is obligated to restore pursuant to this Agreement
or is deemed obligated to restore pursuant to the minimum gain chargeback
provisions of the § 704(b) Regulations and [b] charging to such Capital Account
any adjustments, allocations or distributions described in the qualified income
offset provisions of the § 704(b) Regulations that are required to be charged to
such Capital Account pursuant to this Agreement.

Adjusted Initial Capital Account:

as defined in Section 14.1[a].

Affiliate:

with respect to any Person, any Person that directly or indirectly Controls, is
Controlled by, or is under common Control with, such Person. Notwithstanding the
foregoing, for purposes of this Agreement (except for purposes of the definition
of Third Party), neither the Company nor any of its direct or indirect
subsidiaries will be deemed to be an Affiliate of any Member.

 

 

Agreement:

this Operating Agreement, also known as a limited liability company agreement,
as amended from time to time.

AKD Call Period:

as defined in Section 14.1[d].

AKD Holdings:

as defined in the preamble.

AKD Holdings Contribution Agreement:

as defined in Section 4.1.

AKD Holdings Member:

AKD Holdings and any successor to or Transferee of Units from AKD Holdings who
is admitted as a Member pursuant to Article 13. If at any time there is more
than one AKD Holdings Member, any allocations and Distributions to the AKD
Holdings Member under this Agreement or any other rights or obligations of the
AKD Holdings Member under this Agreement will be allocated among such AKD
Holdings Members based upon the number of Units owned by each AKD Holdings
Member as a percentage of the total number of Units owned by all AKD Holdings
Members.

AKD Net Asset Value

as defined in the Reorganization Agreement.

AKD Redemption Price:

as defined in the Reorganization Agreement.

Annual Budget:

shall mean, as at any time, the Company’s then-effective annual operating and
capital budget approved or otherwise in effect pursuant to Section 7.5.

Appraised Unit Value

as defined in Section 14.3.

Articles:

the Articles of Organization referred to in Section 1.1, as amended from time to
time.

Authorized Valuation Methodology:

as defined in Section 14.3[a].

 

 

Available Cash:

as of any relevant date, the aggregate cash or cash equivalents of the Company
on hand or on deposit with banks or financial institutions or held in any other
form by the Company, less [i] the current portion of indebtedness of the
Company, [ii] payments required to be paid by the Company within one year after
the date of calculation, and [iii] reasonable reserves for working capital and
contingent liabilities of the Company as reasonably determined by the Board of
Managers.

Bankruptcy:

a Person will be deemed bankrupt if:          [a] any proceeding is commenced
against such Person as “debtor” for any relief under bankruptcy or insolvency
laws, or laws relating to the relief of debtors, reorganizations, civil
rehabilitations, arrangements, compositions, or extensions, or such Person
becomes subject to procedures for provisional or final attachment in respect of
all or a material portion of its assets, and [i] such proceeding is not
dismissed or stayed within 120 days after such proceeding has commenced, or [ii]
an order for relief against such Person is granted, or [b] such Person commences
any proceeding for relief under bankruptcy or insolvency laws or laws relating
to the relief of debtors, reorganizations, civil rehabilitations, arrangements,
compositions, or extensions.

Board of Managers:

the governing body of the Company that has the power and authority set forth in
Section 7.1, comprised of all of the Managers, as and when acting in their
capacity as the Board of Managers of the Company as provided in this Agreement.

Budget Committee:

as defined in Section 7.5.

Business Day:

any day other than a Saturday, a Sunday or a day on which banking institutions
in Anchorage, Alaska are required or authorized to be closed.

Call Notice:

as defined in Section 14.1[a].

Capital Account:

the capital account of a Member established and maintained in accordance with
Section 4.3.

 

 

Capital Contribution:

any contribution (or deemed contribution) of money or property by a Member to
the Company that is either an Initial Contribution or an Additional
Contribution.

Change of Control:

with respect to any subject Person means the first to occur of the following
events: [i] any sale, lease, exchange, or other transfer (in one or a series of
related transactions) of all or substantially all of the assets of the subject
Person to any Person or group of related Persons as determined pursuant to
Section 13(d) of the Securities Exchange Act of 1934, other than to one or more
of its Affiliates; or [ii] any event pursuant to which any Person other than any
Affiliates of the subject Person acquires beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934) of
more than 50% of the combined voting power of the then-outstanding voting
securities of the subject Person; provided that no Change of Control with
respect to the Company shall occur as a result of any of the transactions
contemplated by the Reorganization Agreement.

Code:

The Internal Revenue Code of 1986, as amended from time to time, and the
corresponding provisions of any subsequent revenue laws.

Commercially Reasonable Efforts:

reasonable efforts made by any party that will not require such party to
undertake extraordinary or unreasonable measures to obtain any consents,
approvals or other authorizations or to achieve other desired results, including
requiring such party to make any material expenditures (other than normal filing
fees or the like) or to accept any material changes in the terms of a contract,
license or other instrument for which a consent, approval or authorization is
sought.

Common Units:

Units denominated as such and having the rights set forth in Section 3.2.

Company:

as defined in the preamble.

Confidential Information:

as defined in Section 15.3[b].

 

 

Control:

including with correlative meanings, the terms “controlling”, “controlled by”
and “under common control with”, as used with respect to any Person means the
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.

Damages:

as defined in Section 9.1.

Dissolution:

the happening of any of the events described in Section 11.1.

Distribution:

the amount of any money or the Fair Market Value of any property distributed by
the Company to a Member as an operating or liquidating Distribution in
accordance with this Agreement, reduced by the amount of any Company liabilities
assumed by the distributee or to which the distributed property is subject.

EBITDA Multiplier:

as defined in the Management Agreement and as adjusted from time to time
pursuant to Section 5.1(d) of the Management Agreement.

Effective Date:

as defined in the preamble.

Fair Market Value:

the cash price at which a willing seller would sell and a willing buyer would
buy, both having full knowledge of the relevant facts and being under no
compulsion to buy or sell, in an arm’s-length transaction without time
constraints. The Fair Market Value any asset will be the fair market value
thereof as determined in good faith by the Board of Managers or, if requested by
Notice given by any Member, as determined in accordance with the valuation
procedure set forth in Section 14.3, which determination will be conclusive and
binding; provided that any determination of the Fair Market Value of Units for
purposes of determining the Appraised Unit Value of such Units will be governed
in all respects by the provisions of Article 14.

15% Coupon:

as defined in Section 14.1[a].

Fire Lake:

as defined in the preamble.

 

 

Fire Lake Member:

Fire Lake and any successor to or Transferee of Units from Fire Lake who is
admitted as a Member pursuant to Article 13. If at any time there is more than
one Fire Lake Member, any allocations and Distributions to the Fire Lake Member
under this Agreement or any other rights or obligations of the Fire Lake Member
under this Agreement will be allocated among such Fire Lake Members based upon
the number of Units owned by each Fire Lake Member as a percentage of the total
number of Units owned by all Fire Lake Members.

First GCI Call Period:

as defined in Section 14.1[a].

Fiscal Year:

the fiscal and taxable year of the Company, including both 12-month and short
fiscal or taxable years; until changed as provided in this Agreement, each
Fiscal Year will begin on January 1 of each year and end on December 31 of such
year, provided that the first Fiscal Year will begin on the Effective Date and
the last Fiscal Year will end on the date on which Liquidation of the Company is
completed.

Former Operating Agreement:

as defined in Section 1.7.

GAAP:

generally accepted accounting principles as in effect from time to time in the
United States of America, consistently applied.

GCI:

as defined in the preamble.

GCI Member:

GCI and any successor to or Transferee of Units from GCI who is admitted as a
Member pursuant to Article 13. If at any time there is more than one GCI Member,
any allocations and Distributions to the GCI Member under this Agreement or any
other rights or obligations of the GCI Member under this Agreement will be
allocated among such GCI Members based upon the number of Units owned by each
GCI Member as a percentage of the total number of Units owned by all GCI
Members.

GCI Requested Financial Information:

as defined in Section 10.5.

 

 

Governmental Approvals:

any consent, approval or authorization of, notice to, declaration of, or filing
with, any Governmental Authority.

Governmental Authority:

any foreign, domestic, federal, territorial, state or local governmental
authority, quasi-governmental authority, court, government or self-regulatory
organization, commission, tribunal, organization or any regulatory,
administrative or other agency, or any political or other subdivision,
department or branch of any of the foregoing.

Indemnified Persons:

as defined in Section 9.1.

Initial Contribution:

the initial Capital Contribution made (or deemed made) by a Member to the
Company with respect to any Units issued to such Member, as described in
Schedule 4.1.

IRS Notice:

as defined in Section 3.4[b].

Lien:

a mortgage, lien, pledge, collateral assignment, charge, title retention
agreement, levy, execution, attachment, garnishment, security interest or other
encumbrance.

Limited Owner:

as defined in Section 11.3.

Liquidation:

the process of winding up and terminating the Company after its Dissolution.

Losses:

as defined in Section 5.1.

Management Agreement:

The Management Agreement entered into by and between the Company and Fire Lake
as of the date hereof in the form attached hereto as Exhibit C.

Manager:

an individual appointed to serve on the Board of Managers in accordance with
Section 7.2.

Members:

each of the GCI Member, the Pacificom Member, the Red River Member, the Fire
Lake Member and any other Person admitted as a Member pursuant to Article 13.

 

 

Non-GCI Members:

each of the AKD Holdings Member, the Pacificom Member and the Red River Member.

Notice:

any written notice actually delivered pursuant to Section 16.12 or deemed
delivered pursuant to Section 16.13.

 

Original Profits Interest Units:

as defined in Section 3.3[a].

Pacificom:

as defined in the preamble.

Pacificom Member:

Pacificom and any successor to or Transferee of Units from Pacificom who is
admitted as a Member pursuant to Article 13. If at any time there is more than
one Pacificom Member, any allocations and Distributions to the Pacificom Member
under this Agreement or any other rights or obligations of the Pacificom Member
under this Agreement will be allocated among such Pacificom Members based upon
the number of Units owned by each Pacificom Member as a percentage of the total
number of Units owned by all Pacificom Members.

Person:

an individual, corporation, partnership, limited liability company, trust,
unincorporated organization or other entity.

Presumed Tax Liability:

for any Member for a Fiscal Year and any Fiscal Year prior thereto, an amount
equal to the product of [a] the amount of taxable income allocated to such
Member for that Fiscal Year and all Fiscal Years prior thereto and [b] the
Presumed Tax Rate.

Presumed Tax Rate:

the highest combined federal and state income tax rate applicable during such
Fiscal Year to a natural person residing in Alaska, taxable at the highest
marginal federal income tax rate and the highest marginal Alaska income tax
rates, determined without regard to the adjustments provided for in Sections 67
and 68 of the Code.

 

 

Proceeding:

any threatened, pending, ongoing or completed action, suit or proceeding,
whether formal or informal, and whether civil, administrative, investigative or
criminal.

Profits:

as defined in Section 5.1.

Profits Interest Units:

Units denominated as such and having the rights set forth in Section 3.3.

Put Notice:

as defined in Section 14.2[a].

Qualified Appraiser

as defined in Section 14.3[a].

Red River:

as defined in the preamble.

Red River Member:

Red River and any successor to or Transferee of Units from Red River who is
admitted as a Member pursuant to Article 13. If at any time there is more than
one Red River Member, any allocations and Distributions to the Red River Member
under this Agreement or any other rights or obligations of the Red River Member
under this Agreement will be allocated among such Red River Members based upon
the number of Units owned by each Red River Member as a percentage of the total
number of Units owned by all Red River Members.

Regulations:

the Treasury Regulations (including temporary or proposed regulations)
promulgated under the Code, as amended from time to time (including
corresponding provisions of succeeding regulations).

Regulatory Allocations:

as defined in Section 5.12.

Reorganization Agreement:

the Reorganization Agreement dated as of June 16, 2006 among the initial
Members, the Company, and the members of Denali PCS, LLC.

Representatives:

as defined in Section 15.3[a].

Safe Harbor Units:

as defined in Section 3.4[b].

 

 

Second GCI Call Period:

as defined in Section 14.1[b].

Tax Distribution:

as defined in Section 6.5.

Tax Matters Partner:

as defined in Section 10.9.

Third Party:

means, with respect to any Person, any other Person that is not an Affiliate of
such Person.

Transfer:

a direct or indirect sale, exchange, assignment, transfer or other disposition
of a Unit or any interest therein (including the creation of a Lien on all or
any part of a Unit), whether voluntary, involuntary or by operation of law.

Transferee:

a Person to whom a Unit is Transferred in compliance with this Agreement.

Transferor:

a Person who Transfers a Unit in compliance with this Agreement.

Unit:

as defined in Section 3.1.

Vote:

the action of the Members made in accordance with the voting requirements set
forth in Article 7 or any other applicable provision of this Agreement, either
at a meeting or by written consent without a meeting.

Withdrawal:

the occurrence of an event which terminates membership in the Company, as
provided in Section 11.2.

 

ARTICLE 2.

PURPOSES AND POWERS

2.1          Principal Purposes. Subject to the provisions of this Agreement,
the purpose of the Company is [a] to provide wireless communication services;
and [b] to do any and all other acts or things that may be incidental, advisable
or necessary to carry on the business of the Company as contemplated by this
Agreement.

2.2          Other Purposes. The Company may engage in activities related or
incidental to its principal purpose, as well as any other lawful business or
investment activity as may be approved by the unanimous Vote of the Members.

**** CONFIDENTIAL TREATMENT

2.3          Powers. Subject to the provisions of this Agreement, the Company
has all the powers granted to a limited liability company under the Act, as well
as all powers necessary or convenient to or for the furtherance of the purpose
specified in Section 2.1 that are not expressly prohibited to the Company by
applicable law.

 

ARTICLE 3.

UNITS

3.1          Classes of Units. The ownership of the Company shall be divided
into and represented by Units. There shall be two classes of Units: Common Units
and Profits Interest Units. References in this Agreement to “Units” shall
include all Units outstanding as of the relevant date, without regard to class.
The Company shall be authorized to issue a total of 3,830 Units, consisting of
**** Common Units and **** Profits Interest Units, subject to the adjustments
provided for in Sections 3.2 and 3.3 below. The Units owned by each Member are
set forth in Schedule 1.3 (subject to the adjustments contemplated by Section
3.2 and 3.3 below). Each time Units are issued, cancelled, forfeited or
transferred in accordance with the terms and conditions of this Agreement, the
Company shall attach a revised Schedule 1.3 to this Agreement and send a copy
thereof to all Members. No consent of any Member shall be needed to make such
revisions to Schedule 1.3.

3.2

Common Units.

[a]          Issuance. The Company has issued on the Effective Date **** Common
Units to the GCI Member, **** Common Units to AKD Holdings, **** Common Units to
the Pacificom Member and **** Common Units to the Red River Member for the
Capital Contributions set forth in Section 4.1; provided that Section 2.3 of the
Reorganization Agreement provides for an adjustment to the number of Common
Units issued on the Effective Date to the GCI Member based on the value of the
Company as of the Effective Date as determined in accordance with the terms and
conditions of the Reorganization Agreement (such value is referred to in the
Reorganization Agreement as the AKD Net Asset Value); and provided further that
Section 2.4 of the Reorganization Agreement provides that at the closing of the
transactions contemplated by the Reorganization Agreement, GCI shall purchase
from the Company an additional **** Common Units, with the proceeds from the
sale of such additional Common Units to be used by the Company to redeem a like
number of Common Units first from the Pacificom Member and the Red River Member
and then from the AKD Holdings Member. The number of Common Units held by the
Non-GCI Members and the GCI Member following the transactions and adjustments
contemplated by Sections 2.2, 2.3 and 2.4 of the Reorganization Agreement shall
automatically be adjusted as appropriate to reflect that total number of Common
Units finally determined to be held by the Non-GCI Members and the GCI Member
pursuant to the terms and conditions of Sections 2.2, 2.3 and 2.4 of the
Reorganization Agreement. The adjustments to the number of Common Units issued
to the GCI Member based on the AKD Net Asset Value pursuant to Section 2.3 of
the Reorganization Agreement shall be made to be effective retroactively as of
the date of the original issuance. The Company shall make appropriate revisions
to Schedule 1.3 to reflect the number of Common Units held by the Non-GCI
Members or the GCI Member following

**** CONFIDENTIAL TREATMENT

[b]          the transactions contemplated by Sections 2.2, 2.3 and 2.4 of the
Reorganization Agreement, which revisions do not need to be approved by the
Members. Exhibit D provides some examples of the operation of the Sections 2.2,
2.3 and 2.4 of the Reorganization Agreement and the accompanying adjustments to
the total number of Common Units held by each Member. Except as set forth above,
the Company shall have no authority to issue additional Common Units.

[c]          Rights. The holders of the Common Units shall have the voting and
economic rights set forth in the other Articles of this Agreement.

3.3

Profits Interest Units.

[a]          Issuance. The Company has issued on the Effective Date a total of
**** Profits Interest Units to Fire Lake (the “Original Profits Interest
Units”); provided that if the transactions and adjustments contemplated by
Sections 2.2, 2.3 and 2.4 of the Reorganization Agreement result in the Company
having more or less than **** Common Units issued and outstanding, then the
number of the Original Profits Interest Units shall be automatically adjusted to
equal a number of Profits Interest Units equal to [i] the total adjusted number
of Common Units issued and outstanding divided by **** (rounded to two decimal
places), minus [ii] the total adjusted number of Common Units issued and
outstanding. Exhibit D provides some examples of the operation of the Sections
2.2, 2.3 and 2.4 of the Reorganization Agreement and the accompanying
adjustments to the number of Original Profits Interest Units. Except for the
adjustment contemplated by Section 3.3[c] below, the Company shall have no
authority to grant additional Profits Interest Units.

[b]          Rights. Profits Interest Units shall constitute an interest in the
future Profits and Losses of the Company and shall not entitle the holder
thereof to any portion of the value of the Company as of the date that the
Profits Interest Units are issued. The holders of Profits Interest Units shall
have the voting and economic rights set forth in the other Articles of this
Agreement. It is the intent of the Members and the Company that Profits Interest
Units shall represent an interest in the Company that qualifies as a “profits
interest” within the meaning of IRS Revenue Procedure 93-27, 1993-2 C.B. 343, or
any successor authority thereto, and such profits interest shall have no Capital
Account as of the date that any such Profits Interest Units are issued.

[c]          Adjustment of Profits Interest Units. In the event that the
Management Agreement terminates for any reason, GCI exercises its rights to
purchase the Units of the Non-GCI Members and the Fire Lake Member pursuant to
Section 14.1 below or if there is a Change of Control transaction with respect
to the Company, then subject to any forfeiture provisions contained in Section
14.1 below, the number of Profits Interest Units issued to Fire Lake pursuant to
Section 3.3[a] shall be deemed to have been retroactively adjusted as of the
date of the original issuance to equal the amount of the Original Profits
Interest Units multiplied by the applicable EBITDA Multiplier. By way of
example, assuming that the number of Original Profits Interest Units remains at
230 pursuant to Section 3.3[a], then if there is an adjusting event and the
EBITDA Multiplier is equal to 1.5, then Fire Lake will be deemed to

 

[d]

have owned 345 Profits Interest Units from the Effective Date. The Company will
then make appropriate adjustments to the Capital Accounts of the Members to
reflect this adjustment, which adjustments will not need to be approved by the
Members. The Company shall also make appropriate revisions to Schedule 1.3,
which revisions will not need to be approved by the Members.

3.4

Code Section 83(b) Election and Safe Harbor.

[a]          General. Each Member that acquires an interest in the Company that
is subject to vesting agrees that within 30 days after such Person becomes a
Member, the Person who is performing the services to which the vesting
requirement relates shall file an election with the Internal Revenue Service
under Section 83(b) of the Code and the regulations promulgated thereunder with
respect to that interest (and with respect to any other interest in the Company
that is subject to vesting based upon services to be performed by that Person).

[b]          Safe Harbor Election. By executing this Agreement, each Member
authorizes and directs the Company to elect to have the “Safe Harbor” described
in the proposed Revenue Procedure set forth in Internal Revenue Service Notice
2005-43 (the “IRS Notice”) apply to any Units transferred to a service provider
by the Company on or after the effective date of such Revenue Procedure (or any
substantially similar Revenue Procedure or other guidance issued by the Internal
Revenue Service) in connection with services provided to the Company. For
purposes of making such Safe Harbor election, the Board of Managers is hereby
designated as the “partner who has responsibility for federal income tax
reporting” by the Company and, accordingly, that execution of such Safe Harbor
election by the Board of Managers constitutes execution of a “Safe Harbor
Election” in accordance with Section 3.03(1) of the IRS Notice with respect to
such Units (“Safe Harbor Units”). The Company and each Member hereby agree to
comply with all requirements of the Safe Harbor described in the IRS Notice (and
any substantially similar Revenue Procedure or other guidance issued by the
Internal Revenue Service), including, without limitation, the requirement that
each Member shall prepare and file all federal income tax returns reporting the
income tax effects of each Safe Harbor Units issued by the Company in a manner
consistent with the requirements of the IRS Notice (an any substantially similar
Revenue Procedure or other guidance issued by the Internal Revenue Service).

[c]          Failure to Comply. Any Member or former Member that fails to comply
with the requirements set forth in Section 3.4[a] or Section 3.4[b] shall
indemnify and hold harmless the Company and each adversely affected Member and
former Member from and against any and all losses, liabilities, taxes, damages,
judgments, fines, costs, penalties, amounts paid in settlement and reasonable
out-of-pocket costs and expenses incurred in connection therewith (including,
without limitation, costs and expenses of suits and proceedings, and reasonable
fees and disbursements of counsel), in each case resulting from such Member’s or
former Member’s failure to comply with such requirements. The Board of Managers
may offset distributions to which a Person is otherwise entitled under this
Agreement against such Person’s obligation to indemnify the Company and any
other Person under this Section 3.4[c] (and any amount so offset with respect to
such Person’s obligation to indemnify a Person other than the Company shall be
paid over to such other Person by the Company). A Member’s obligations to comply
with the requirements of Section 3.4[a] or Section 3.4[b]

and to indemnify the Company and any Member or former Member under this Section
3.4[c] shall survive such Member’s ceasing to be a Member of the Company and/or
the termination, dissolution, liquidation and winding up of the Company, and,
for purposes of this Section 3.4[c], the Company shall be treated as continuing
in existence. The Company and any Member or former Member may pursue and enforce
all rights and remedies it may have against each Member or former Member under
this Section 3.4[c], including [i] instituting a lawsuit to collect such
indemnification and contribution, with interest calculated at a rate equal to
the prime rate plus three percentage points per annum (but not in excess of the
highest rate per annum permitted by law), compounded on the last day of each
fiscal quarter and [ii] specific performance and/or immediate injunctive or
other equitable relief from any court of competent jurisdiction (without the
necessity of showing actual money damages, or posting any bond or other
security) in order to enforce or prevent any violation of the provisions of
Section 3.4[a] or Section 3.4[b].

[d]          Certain Amendments. Each Member authorizes the Board of Managers to
amend Section 3.4[a] and Section 3.4[b] to the extent necessary to achieve
substantially the same tax treatment with respect to any interest in the Company
transferred by the Company to a service provider in connection with services
provided to the Company as set forth in Section 4 of the IRS Notice (e.g., to
reflect changes from the rules set forth in the IRS Notice in subsequent
Internal Revenue Service guidance), provided that such amendment is not
materially adverse to any Member (as compared with the after-tax consequences
that would result if the provisions of the IRS Notice applied to all interests
in the Company transferred to a service provider by the Company in connection
with services provided to the Company).

3.5          Reacquired Units. Any Units reacquired by the Company shall
automatically be cancelled and shall not be deemed issued or outstanding. Units
reacquired by the Company shall not be available for reissuance.

3.6          Certificates. The Company may issue certificates representing any
or all of the outstanding Units, in the discretion of the Board of Managers.

 

ARTICLE 4.

CAPITAL OF THE COMPANY

4.1          Initial Contributions. By execution of this Agreement: [a] AKD
Holdings acknowledges and agrees that all of the Class A Membership Interest and
Class B Membership Interest and accompanying Class A Points, Class B Points and
Voting Points (as such terms are defined in the Former Operating Agreement)
granted to Pacificom, Red River and Graystone Holdings, LLC, an Alaska limited
liability company pursuant to the Former Operating Agreement and transferred to
AKD Holdings

**** CONFIDENTIAL TREATMENT

pursuant to that certain Transfer and Contribution Agreement dated as of
December 28, 2006 by and among the Non-GCI Members (the “AKD Holdings
Contribution Agreement”) are hereby converted and reclassified into the ****
Common Units (and accompanying voting and economic rights set forth in this
Agreement) issued to AKD Holdings pursuant to Section 3.2[a]; [b] Red River
acknowledges and agrees that all of its Class A Membership Interest and
accompanying Class A Points and Voting Points (as such terms are defined in the
Former Operating Agreement) granted pursuant to the Former Operating Agreement
and not transferred to AKD Holdings pursuant to the AKD Holdings Contribution
Agreement are hereby converted and reclassified into the **** Common Units (and
accompanying voting and economic rights set forth in this Agreement) issued to
Red River pursuant to Section 3.2[a]; [c] Pacificom acknowledges and agrees that
all of its Class A Membership Interest and accompanying Class A Points and
Voting Points (as such terms are defined in the Former Operating Agreement)
granted pursuant to the Former Operating Agreement and not transferred to AKD
Holdings pursuant to the AKD Holdings Contribution Agreement are hereby
converted and reclassified into the **** Common Units (and accompanying voting
and economic rights set forth in this Agreement) issued to Pacificom pursuant to
Section 3.2[a]; and [d] the Members acknowledge and agree that Graystone
Holdings, LLC, an Alaska limited liability company shall have no membership or
other interest whatsoever in the Company since all of its Class B Membership
Interest and accompanying Class B Points and Voting Points (as such terms are
defined in the Former Operating Agreement) granted pursuant to the Former
Operating Agreement were transferred to AKD Holdings pursuant to the AKD
Holdings Contribution Agreement. Contemporaneously with or prior to the
execution of this Agreement, GCI will make or will have made the Capital
Contribution to the Company contemplated to be made by GCI with respect to its
Units pursuant to Section 2.3 of the Reorganization Agreement. The agreed Fair
Market Value of GCI’s contribution as specified in Schedule 4.1 will be credited
to GCI’s Capital Account with respect to such Units, and such agreed Fair Market
Value will be deemed to be the amount of GCI’s Initial Capital Contribution. The
Capital Account of the Non-GCI Members will be adjusted as of the Effective Date
pursuant to Treasury Regulation § 1.704-1(b)(2)(iv)(f)-(g) which will result in
the Capital Account balances specified in Schedule 4.1, and such agreed amounts
will be deemed to be the amount of such Non-GCI Member’s Initial Capital
Contribution. Notwithstanding the forgoing, Schedule 4.1 shall be amended as
appropriate to adjust the Non-GCI Members’ and the GCI Member’s Capital Account
as appropriate to reflect [i] the adjustments made to the AKD Net Asset Value
pursuant to Section 2.3 of the Reorganization Agreement and the resulting change
in the number of Common Units owned by the GCI Member pursuant to the terms and
conditions of Section 2.3 of the Reorganization Agreement and [ii] the issuance
of Common Units and accompanying redemptions pursuant to Section 2.4 of the
Reorganization Agreement and any adjustments made to the AKD Redemption Price
(as defined in the Reorganization Agreement) pursuant to Section 2.4 of the
Reorganization Agreement and any resulting change in the number of Common Units
owned by the Members. Exhibit D provides some examples of the operation of
Sections 2.2, 2.3 and 2.4 of the Reorganization Agreement and the accompanying
adjustments to the Capital Accounts of each Member.

4.2          Additional Contributions Except as required by law and except for
the adjustments contemplated by Section 4.1 above, no Additional Contributions
will be required or permitted to be made by any Member except upon the unanimous
Vote of the Members.

4.3

Capital Accounts. A Capital Account will be maintained for each Member and
credited, charged and otherwise adjusted as required by § 704(b) of the Code and
the § 704(b) Regulations. Each Member’s Capital Account will be:

[a]   Credited with [i] the amount of money contributed by the Member as an
Initial Contribution or an Additional Contribution, [ii] the Fair Market Value
of assets contributed by the Member as an Initial Contribution or Additional
Contribution (net of liabilities that the Company assumes or takes subject to
that were not taken into account in determining the Fair Market Value of such
assets), [iii] the Member’s allocable share of Profits and [iv] all other items
properly credited to such Capital Account as required by the § 704(b)
Regulations;

[b]   Charged with [i] the amount of money distributed to the Member by the
Company, [ii] the Fair Market Value of assets distributed to the Member by the
Company (net of liabilities that the Member assumes or takes subject to that
were not taken into account in determining the Fair Market Value of such
assets), [iii] the Member’s allocable share of Losses and [iv] all other items
properly charged to such Capital Account as required by the § 704(b)
Regulations; and

 

[c]

Otherwise adjusted as required by the § 704(b) Regulations.

Any unrealized appreciation or depreciation with respect to any asset
distributed in kind will be allocated among the Members in accordance with the
provisions of Article 4 as though such asset had been sold for its Fair Market
Value on the date of Distribution and the Members’ Capital Accounts will be
adjusted to reflect both the deemed realization of such appreciation or
depreciation and the Distribution of such property.

The foregoing provisions and the other provisions of this Agreement relating to
the maintenance of Capital Accounts are intended to comply with the § 704(b)
Regulations and will be interpreted and applied in a manner consistent with such
Regulations and any amendment or successor provision thereto. The Members will
cause appropriate modifications to be made if unanticipated events might
otherwise cause this Agreement not to comply with the § 704(b) Regulations, so
long as such modifications do not cause a material change in the relative
economic benefits of the Members under this Agreement.

4.4          Adjustments. The Members intend to comply with the § 704(b)
Regulations in all respects, and the Capital Accounts of the Members will be
adjusted to the full extent that the § 704(b) Regulations may apply (including
applying the concepts of qualified income offsets and minimum gain chargebacks).

4.5          Transfer. If any Units are Transferred in accordance with this
Agreement, the Capital Account of the Transferor that is attributable to the
Transferred Units will carry over to the Transferee.

4.6          Market Value Adjustments. Appropriate Capital Account adjustments
will be made upon any Transfer of any Units, including those that apply upon the
constructive liquidation of the Company under § 708(b) of the Code, all in
accordance with the § 704(b) Regulations. Similarly, if optional basis
adjustments are made under § 734 or § 743 of the Code, appropriate Capital
Account adjustments will be made as required by the § 704(b) Regulations.

4.7

No Withdrawal of Capital. Except as specifically provided in this Agreement, no
Member will be entitled to withdraw all or any part of its Capital Contribution
from the Company prior to the Company’s Dissolution and Liquidation or, when
such withdrawal of capital is permitted, to demand a Distribution of property
other than money or as otherwise provided in this Agreement.

4.8          No Interest on Capital. No Member will be entitled to receive
interest on such Member’s Capital Account or Capital Contribution.

4.9          No Drawing Accounts. The Company will not maintain a drawing
account for any Member. All Distributions to Members will be governed by Article
6 (relating to Distributions not in Liquidation of the Company) and by Article
12 (relating to Liquidation).

 

ARTICLE 5.

PROFITS AND LOSSES

5.1          Determination. The terms “Profits” and “Losses” mean, respectively,
the net profits and losses of the Company determined for each Fiscal Year in
accordance with the method of accounting adopted by the Company for federal
income tax purposes, except that such net profit or loss will be determined [a]
by including as an item of income any income that is exempt from taxation, [b]
by deducting as an expense any expenditure of the Company not deductible in
computing its taxable income and not properly chargeable to any Capital Account,
or deemed not deductible in computing its taxable income and not properly
chargeable to any Capital Account in accordance with the § 704(b) Regulations
and [c] by calculating the gain, loss, depreciation and amortization on property
that is reflected in the Capital Accounts at a book basis different from the
basis of such property for federal income tax purposes based on the book basis
of such property in accordance with the § 704(b) Regulations. Any allocation of
Profits or Losses will be considered a pro rata allocation of each item entering
into the computation of Profits and Losses.

5.2          Allocation of Profits and Losses Generally. Except as otherwise
provided in this Agreement, the Profits or Losses of the Company, including
items of income, gain, loss and deduction for each Fiscal Year, will be
allocated to the Members in proportion to their Units, without distinction as to
class or series; provided that [a] no portion of the Profits or Losses
attributable to the realization of the value of the Company as of the date that
a Profits Interest Unit is issued shall be allocated to that Profits Interest
Unit and [b] no portion of any item of income, gain, loss or deduction
recognized prior to the issuance of a Unit shall be allocated to that Unit. The
intent of the foregoing is to provide that each Profits Interest Unit shall
participate to the same extent as a Common Unit in Profits and Losses
attributable to operations of the Company after the date that the Profits
Interest Unit is issued, but that a Profits Interest Unit shall participate to
the same extent as a Common Unit in gain from the disposition of all or
substantially all assets of the Company only to the extent that such gain
reflects an increase in the fair market value of the assets of the Company from
the date of the issuance of the Profits Interest Unit.

5.3          Nonrecourse Deductions. Losses attributable to any Company
nonrecourse liability (for which no Member or related Person (within the meaning
of the § 752 Regulations)

bears the economic risk of loss) will be allocated in the same manner as Losses
are allocated pursuant to Section 5.2, and Losses of the Company attributable to
any Member nonrecourse liability (that is nonrecourse to the Company, but for
which one or more Members or related Persons bear the economic risk of loss)
will be allocated in accordance with the § 704(b) Regulations to those Members
bearing (or who, because of their relationship to Persons who bear such economic
risk of loss, are deemed to bear) the economic risk of loss for the liability.
The allocation of liabilities to a property, the determination of nonrecourse
deductions, the effect of property revaluations and all other issues affecting
the allocation of nonrecourse deductions will be determined in accordance with
the § 704(b) Regulations.

5.4          Minimum Gain Chargeback. Notwithstanding the general rule on
allocation of Profits stated in Section 5.2, if there is a net decrease in
Company minimum gain for any Fiscal Year, each Member will be allocated items of
Profits for such year equal to such Member’s share of the net decrease in
Company minimum gain. If there is a net decrease in Member nonrecourse debt
minimum gain for any Fiscal Year, each Member having a share of such minimum
gain will be allocated items of Profits equal to such Member’s share of such net
decrease in Company nonrecourse debt minimum gain. The determination of net
decreases in Company minimum gain and Member nonrecourse debt minimum gain,
allocations of such net decreases, exceptions to minimum gain chargebacks and
all other issues affecting the minimum gain chargeback requirements will be
determined in accordance with the § 704(b) Regulations.

5.5          Tax Allocations.Allocation of items of income, gain, loss and
deduction of the Company for federal income tax purposes for a Fiscal Year will
be allocated, as nearly as is practicable, in accordance with the manner in
which such items are reflected in the allocations of Profits and Losses among
the Members for such Fiscal Year. To the extent possible, principles identical
to those that apply to allocations for federal income tax purposes will apply
for state and local income tax purposes.

5.6          Qualified Income Offset. Notwithstanding any other provision of
this Agreement to the contrary (except Section 5.4, which will be applied
first), if in any Fiscal Year or other period a Member unexpectedly receives an
adjustment, allocation or Distribution described in the qualified income offset
provisions of the § 704(b) Regulations, such Member will be specially allocated
items of income in an amount and manner sufficient to eliminate, to the extent
required by the § 704(b) Regulations, the Adjusted Capital Account Deficit of
such Member as quickly as possible.

5.7          Limit on Loss Allocations. Notwithstanding the provisions of
Section 5.2 or any other provision of this Agreement to the contrary, Losses (or
items thereof) will not be allocated to a Member if such allocation would cause
or increase a Member’s Adjusted Capital Account Deficit and will be reallocated
to the Members (other than any such Member to which the limitations of this
Section 5.7 apply), subject to the limitations of this Section 5.7.

5.8          § 754 Adjustments. To the extent an adjustment to the adjusted tax
basis of any Company asset under § 734(b) or § 743(b) of the Code is required to
be taken into account in determining Capital Accounts under the § 704(b)
Regulations, the amount of the adjustment to the Capital Accounts will be
treated as an item of gain (if the adjustment increases the basis of the asset)
or loss (if the adjustment decreases the basis), and the gain or loss will be
specially

allocated to the Members in a manner consistent with the manner in which their
Capital Accounts are required to be adjusted under the § 704(b) Regulations.

5.9          Contributed Property. All items of gain, loss and deduction with
respect to property that is reflected in the Capital Accounts of the Members at
a basis different from such property’s adjusted tax basis will be allocated,
solely for tax purposes, among the Members to take into account the variation
between the adjusted tax basis of the property and the basis reflected in the
Member’s Capital Account according to the principles of the § 704(c)
Regulations. For example, if there is built-in gain with respect to certain
property at the time of such property’s contribution to the Company, upon the
Company’s sale of that property the pre-contribution taxable gain (as
subsequently adjusted under the § 704(c) Regulations during the period such
property was held by the Company) would be allocated to the contributing Member
(and such pre-contribution gain would not again create a Capital Account
adjustment because the property was credited to Capital Account upon
contribution at its Fair Market Value). Except as limited by the following
sentence, the allocation of tax items with respect to § 704(c) property to
Members that do not reflect a basis difference with respect to such property in
their Capital Accounts will, to the extent possible, be equal to the allocation
of the corresponding book items made to such Members with respect to such
property. All tax allocations made under this Section 5.9 will be made in
accordance with § 704(c) of the Code, and the method of making such allocations
will be determined by the Members, acting together.

5.10     Tax Credits.To the extent that the federal income tax basis of an asset
is allocated to the Members in accordance with the Regulations promulgated under
§ 46 of the Code, any tax credit attributable to such tax basis will be
allocated to the Members in the same ratio as such tax basis. With respect to
any other tax credit, to the extent that a Company expenditure gives rise to an
allocation of loss or deduction, any tax credit attributable to such expenditure
will be allocated to the Members in the same ratio as such loss or deduction.
Consistent principles will apply in determining the Members’ interests in tax
credits that arise from taxable or non-taxable receipts of the Company. All
allocations of tax credits will be made as of the time such credit arises. Any
recapture of a tax credit will be allocated, to the extent possible, to the
Members in the same manner as the tax credit was allocated to them. Except as
otherwise specifically provided in the § 704(b) Regulations (such as the
adjustments required when there is an upward or downward adjustment in the tax
basis of investment credit property), allocations of tax credits and their
recapture will not be reflected by any adjustment to Capital Accounts.

5.11       Gross Income Allocation. In the event any Member has a deficit
Capital Account at the end of any Company Fiscal Year that is in excess of the
sum of [i] the amount such Member is obligated to restore to the Company
pursuant to any provision of this Agreement, [ii] the amount such Member is
deemed to be obligated to restore pursuant to the penultimate sentence of
Treasury Regulations Section 1.704-2(g)(1) and [iii] the amount such Member is
deemed to be obligated to restore pursuant to the penultimate sentence of
Treasury Regulations Section 1.704-2(i)(5), each such Member shall be specially
allocated items of Company income and gain in the amount of such excess as
quickly as possible; provided, however, that an allocation pursuant to this
Section 5.11 shall be made only if and to the extent that such Member would have
a deficit Capital Account in excess of such sum after all other allocations
provided for in this Article 5 have been tentatively made as if Section 5.6 and
this Section 5.11 were not in the Agreement.

 

5.12

Curative Allocations. The allocations set forth in Sections 5.3, 5.4, 5.6, 5.8
and 5.11 (the “Regulatory Allocations”) are intended to comply with certain
requirements of the Treasury Regulations. It is the intent of the Members that,
to the extent possible, all Regulatory Allocations shall be offset either with
other Regulatory Allocations or with special allocations of other items of
Company income, gain, loss or deduction pursuant to this Section 5.12.
Therefore, notwithstanding, any other provision of this Article 5 (other than
the Regulatory Allocations), the Board of Managers shall make such offsetting
special allocations of Company income, gain, loss or deduction in whatever
manner it determines appropriate so that, after such offsetting allocations are
made, each Member’s Capital Account balance is, to the extent possible, equal to
the Capital Account balance such Member would have had if the Regulatory
Allocations were not part of the Agreement and all Company items were allocated
pursuant to Section 5.2. In exercising its discretion under this Section 5.12,
the Board of Managers shall take into account any future Regulatory Allocations
under Section 5.4 that, although not yet made, are likely to offset Regulatory
Allocations made under Section 5.3.

5.13       Allocation on Transfer. If any Unit is Transferred during any Fiscal
Year of the Company (whether by liquidation or Transfer of a Unit or otherwise),
the books of the Company will be closed as of the effective date of Transfer.
The Profits or Losses attributed to the period from the first day of such Fiscal
Year through the effective date of Transfer will be allocated to the Transferor
and the Profits or Losses attributed to the period commencing on the day after
the effective date of Transfer will be allocated to the Transferee. In lieu of
an interim closing of the books of the Company and with the agreement of the
Transferor and the Transferee, the Company may allocate Profits and Losses for
such Fiscal Year between the Transferor and the Transferee based on a daily
proration of items for such Fiscal Year or any other reasonable method of
allocation (including an allocation of extraordinary Company items, as
determined by the Company, based on when such items are recognized for federal
income tax purposes).

 

ARTICLE 6.

distributions

6.1          Distributions Generally. Except for liquidating Distributions under
Section 12.3 and except as otherwise provided by Section 6.5, the Company will
make all Distributions of Available Cash to the Members in proportion to their
Units, without distinction as to class, subject to the limitation that
Distributions in respect of Profits Interest Units shall relate only to Profits
earned and increases in value of the Company after the date that such Profits
Interest Units are issued. Except as provided by Section 6.5, the timing and
amount of Distributions shall be determined by the Board of Managers.

6.2          Payment. All Distributions will be made to Members owning Units on
the date of record, such date being the Business Day immediately preceding the
date of Distribution, as reflected on the books of the Company.

6.3         Withholding. If required by the Code or by state or local law, the
Company will withhold any required amount from Distributions to a Member for
payment to the appropriate taxing authority. Any amount so withheld from a
Member will be treated as a Distribution by the Company to such Member. Each
Member will timely file any agreement that is required by

any taxing authority in order to avoid any withholding obligation that otherwise
would be imposed on the Company.

6.4          Distribution Limitations. Notwithstanding any other provision of
this Agreement, the Company will not make any Distribution to the Members if,
after the Distribution, the liabilities of the Company (other than liabilities
to Members on account of their Units) would exceed the Fair Market Value of the
Company’s assets. With respect to any property that is subject to a liability
for which the recourse of creditors is limited to the specific property, such
property will be included in assets only to the extent the property’s Fair
Market Value exceeds its associated liability, and such liability will be
excluded from the Company’s liabilities. Notwithstanding any other provision of
this Agreement, the Company will not make a Distribution to any Member if such
Distribution would cause or increase any Member’s Adjusted Capital Account
Deficit.

6.5          Tax Distribution. For each Fiscal Year the Company will, during
such Fiscal Year or the immediately subsequent Fiscal Year, but not later than
90 days following the end of each Fiscal Year, to the extent that there is
Available Cash distribute to each Member, with respect to such Fiscal Year, a
distribution in an amount equal to such Member’s Presumed Tax Liability for such
Fiscal Year (a “Tax Distribution”). Any amount distributed pursuant to this
Section 6.5 will be deemed to be an advance distribution of amounts otherwise
distributable to the Members pursuant to Sections 6.1 and will reduce the
amounts that would subsequently otherwise be distributable to the Members
pursuant to such provisions in the order they would otherwise have been
distributable. The Board of Managers may distribute Tax Distributions quarterly
on an estimated basis prior to the end of a Fiscal Year, but if the amounts so
distributed as estimated Tax Distributions exceed the amount of Tax
Distributions to which such Member is entitled to for such Fiscal Year, the
Member will promptly after the end of the Fiscal Year return such excess to the
Company and the excess will be treated as a distribution to such Member pursuant
to Section 6.1, as applicable until it is returned.

 

ARTICLE 7.

MANAGEMENT

7.1          Management. Management of the Company will be vested exclusively in
the Board of Managers. Except as otherwise provided in this Agreement: [a] the
Board of Managers has complete and unrestricted power and authority to manage
the business, properties and activities of the Company in its sole and exclusive
discretion, [b] no Person dealing with the Company will be required to inquire
into the authority of the Board of Managers (or any designee of the Board of
Managers) to take any action or make any decision, [c] notwithstanding any
powers granted to members of a limited liability company under the Act, no
Member will take part in the operations, management or control of the Company’s
business, transact any business in the Company’s name, or have the power to sign
documents for or otherwise bind the Company except for such actions that are
specifically authorized by the Board of Managers or as otherwise provided by
this Agreement, and [d] the Board of Managers has the rights, authority and
powers of a “manager” under the Act with respect to the Company business and
assets as provided in the Act as in effect on the Effective Date. Without
limiting the foregoing, the Board of Managers has all of the responsibilities
and authority of the board of directors of an Alaska business corporation,
subject to the express provisions of this Agreement; provided, that the

reference to Alaska business corporations is not intended and will not be
construed to subject the Company to any restriction or limitation or to subject
the Managers to any duty or liability applicable to Alaska corporations or their
directors that is not otherwise applicable to an Alaska limited liability
company or its managers or agents. Concurrently with the execution of this
Agreement, the Company shall enter into the Management Agreement, pursuant to
which Fire Lake will perform certain management duties for the Company as
described therein. Notwithstanding any other provision of this Agreement to the
contrary, the Company will not take any of the following actions, and neither
the Board of Managers nor Fire Lake acting under the Management Agreement shall
have any authority to take any of the following actions on behalf of the
Company, without the written consent of the GCI Member: [i] cause or permit the
Company to engage in any business other than the business described in Section
2.1; [ii] except as provided in the current Annual Budget, cause or permit the
Company to purchase or otherwise acquire additional assets having an aggregate
cost of $250,000 or more in any transaction or series of related transactions;
[iii] cause or permit the Company to merge or consolidate with any Person; [iv]
except as provided in the current Annual Budget, cause or permit the Company to
sell, lease or otherwise dispose of assets having an aggregate value of $250,000
or more in any transaction or series of related transactions; [v] cause or
permit the Company to engage in, enter into or amend any contract, arrangement
or transaction in which any Member or any Affiliate of a Member has a direct or
indirect interest; [vi] cause or permit the Company to authorize, issue or enter
into any agreement providing for any issuance (contingent or otherwise) of any
additional Units or other securities, except as contemplated by Article 3 above;
[vii] cause or permit the Company to authorize or permit any mandatory or
permissive Additional Contributions or to admit any additional Members (other
than in connection with a Transfer of Units made in accordance with the
provisions of Article 13, which will be governed in all respects by the
provisions of Article 13); [viii] cause or permit the Company to redeem any
Units or make any other extraordinary distributions not contemplated by Article
6, except as contemplated by Article 3 above; [ix] cause or permit the Company
to incur or guarantee any indebtedness (other than the incurrence of trade
payables in the ordinary course of business) or incur or guarantee any Lien,
except for indebtedness or Liens provided in the Annual Budget and except for
indebtedness or Liens contemplated by the Reorganization Agreement; [x] cause or
permit the Company to approve any deviation from the Annual Budget then in
effect of 10% or greater from an approved line item or budget category or to
engage in any transaction which has not been budgeted for in the Annual Budget
then in effect; [xi] cause or permit the Company to liquidate, wind up,
dissolve, or cease to continue as an ongoing business concern (other than in
connection with any events of Dissolution specified in Section 11.1, which will
be governed in all respects by the provisions of Section 11.1), effect a
recapitalization or reorganization in any form of transaction, commence any
bankruptcy or insolvency proceeding, acquiesce to the appointment of a receiver,
trustee, custodian or liquidator or admit the material allegations of a petition
filed against the Company in any bankruptcy or insolvency proceeding; [xii]
cause or permit the Company to change from a limited liability company to a
different organizational form; [xiii] cause or permit any direct or indirect
subsidiary of the Company to do any of the foregoing in respect of the
subsidiary; or [xiv] enter into an agreement or otherwise commit to do any of
the foregoing.

7.2

Appointment of Board of Managers. The Board of Managers will initially consist
of five (5) Managers. The number of Managers on the Board of Managers shall be
fixed from time to time by the Board of Managers, but shall not be less than
four Managers or more than eight Managers. The GCI Member shall at all times
have the sole right to appoint and remove one Manager and the AKD Holdings
Member shall have the sole right to appoint and remove the remaining members of
the Board of Managers. The AKD Holdings Member may not appoint as a Manager, any
Person who serves on the board of directors or comparable governing body of a
communications company that competes with GCI. The AKD Holdings Member will
elect a sufficient number of Managers deemed independent from GCI under
applicable laws, regulations or stock exchange rules to allow GCI to comply with
any such applicable laws, regulations or stock exchange rules. The name of the
initial Manager appointed by GCI Member will be John M. Lowber and the names of
the initial Managers appointed by the AKD Holdings Member will be Stephen
Roberts, William M. Yandell III, James D. Lackie and John Tindall. Each Manager
is entitled to appoint an alternate to serve in his or her absence at any
meeting of the Board of Managers. Each Manager will serve on the Board of
Managers until his or her resignation or removal by the Member that appointed
such Manager. Either the GCI Member or the AKD Holdings Member may, at any time,
remove a Manager appointed by such Member and appoint a substitute Manager by
delivering Notice of such removal and appointment to the other Members. Any
vacancy on the Board of Managers resulting from the death, disability or
resignation of a Manager will be filled by the Member that appointed such
Manager. No compensation will be paid to any Manager for serving in such
capacity, except that Managers will be entitled to reimbursement for reasonable
expenses incurred in connection with such service.

7.3          Procedural Requirements -- Meetings Of Members and the Board of
Managers.  

[a]          Action by Members. Except as otherwise expressly provided in this
Agreement, [i] all actions requiring the approval of the Members will be deemed
approved if Members owning more than 50% of the outstanding Units as of the
record date for the meeting or written consent Vote in favor of approval, [ii]
all Units will vote together as a single voting group, and [iii] each Unit will
have one vote.

[b]          Action by Board of Managers. Except as otherwise expressly provided
in this Agreement, the act of the majority of the Managers present at a meeting
at which a quorum is present shall be the act of the Board of Managers.

 

[c]

Meetings of Members and the Board of Managers.

 

[i]

Annual Meeting of Members. An annual meeting of the Members will be held on such
date and at time as may be determined by the Board of Managers. The purpose of
the annual meeting is to review the Company’s operations for the preceding
Fiscal Year and to transact such other business as may come before the meeting.
The failure to hold any annual meeting has no adverse effect on the continuance
of the Company.

 

[ii]

 

 

Special Meetings. Special meetings of the Members, for any purpose or purposes,
may be called by the Board of Managers or by any Member or Members owning at
least 10% of the Units then outstanding.

 

[iii]

Meetings of the Board of Managers. The Board of Managers will meet from time to
time at the request of any Manager.

 

[iv]

Place. The person calling a meeting of Members or of the Board of Managers may
designate the place of the meeting. If the place so designated for a meeting of
Members is not in the Anchorage, Alaska metropolitan area and for a meeting of
the Board of Managers is not in the Anchorage, Alaska or Memphis, Tennessee
metropolitan area, then such location must be agreed in the case of a Member
meeting, by Members who own more than 50% of the Units then outstanding, and in
the case of a Board of Managers meeting, by all of the Managers. If no
designation is made by a person calling a meeting of Members or the Board of
Managers, the place of meeting will be the Company’s principal place of
business.

 

[v]

Notice. Notice of any Board of Managers or Members meeting must be given not
less than three Business Days nor more than 30 days before the date of the
meeting. Such Notice must state the place, day and hour of the meeting and, in
the case of a special Members meeting, the purpose for which the meeting is
called.

 

[vi]

Waiver of Notice. Any Member or Manager may waive, in writing, any Notice
required to be given to such Member or Manager, whether before or after the
meeting or other event to which such Notice relates. Attendance by a Member or
Manager at a meeting will constitute a waiver of notice of the meeting, unless
the Member or Manager attends the meeting for the sole and express purpose of
objecting to the transaction of any business on the ground that the meeting is
not lawfully called.

 

[vii]

Record Date. For the purpose of determining Members entitled to Notice of and to
vote at any meeting of Members, or to sign any written consent, the last
Business Day before the day on which such Notice or consent is first transmitted
to the Members will be the record date. Any such determination of Members
entitled to vote at any meeting of Members will apply to any adjournment of a
meeting.

 

[viii]

Quorum. A quorum at any meeting of Members will consist of Members who own more
than 90% of the outstanding Units on the record date for the meeting (which
Members may be in attendance in person, by proxy, by telephone or by video
conference). A quorum at any meeting of the Board of Managers will consist of a
majority of the number of directors fixed by the Board of Managers pursuant to
Section 7.2 (which Managers may be in attendance in person, by proxy, by
telephone or by video conference). Any Board of Managers or

 

[ix]

 

 

Members meeting at which a quorum is not present may be adjourned to a specified
place, day and hour without further Notice.

 

[x]

Proxies. At any meeting of Members or the Board of Managers, a Member or a
Manager may vote in person or by written proxy given to another Member or
Manager. Such proxy must be signed by the Member or Manager, or by a duly
authorized attorney-in-fact, and must be filed with the Company before or at the
time of the meeting. No proxy will be valid after eleven months from the date of
its signing unless otherwise provided in the proxy. Attendance at the meeting by
the Member or Manager giving the proxy will revoke the proxy during the period
of attendance.

 

[xi]

Meetings by Telephone or Video. The Members and the Managers may participate in
a meeting by means of conference telephone or video or similar communications
equipment by which all Members or Managers participating in the meeting can hear
each other at the same time. Such participation will constitute presence in
person at the meeting and waiver of any required Notice. The Company will take
all reasonable steps to ensure that Members and Managers are able to participate
by telephone or video conference in meetings of Members and meetings of the
Board of Managers, respectively.

 

[xii]

Observers. The Board of Managers will permit any individuals designated by the
GCI Member or the AKD Holdings Member to be observers at any meetings of the
Board of Managers, except that the AKD Holdings Member can not designate any
person to be an observer if such person serves on the board of directors or
comparable governing body of a communications company that competes with GCI.

[d]          Action Without a Meeting. Any action required or permitted to be
taken at a meeting of Members may be taken without a meeting if the action is
evidenced by one or more written consents describing the action taken, signed by
Members whose aggregate Units would enable them to approve the action at a
meeting of the Members at which all Members were present and voted. Any action
required or permitted to be taken at a meeting of Managers may be taken without
a meeting if, and will be effective when, the action is evidenced by one or more
written consents describing the action taken, signed by all Managers. Action so
taken is effective when sufficient Members or Managers approving the action have
signed the consent, unless the consent specifies a different effective date. If
any action is taken by a written consent that is not signed by all Members,
Notice of the action, accompanied by a copy of the written consent, will be sent
to each Member who did not sign.

7.4          Officers. The Board of Managers may from time to time appoint
executive officers of the Company and designate their authority and duties to
manage the day-to-day operations of the Company. Unless otherwise determined by
the Board of Managers, if the title of an officer is one commonly used for
officers of a business corporation formed under the Alaska Corporation Code, the
assignment of such title will constitute the delegation to such person of the
authorities and duties that are normally associated with that office. Such
officers will take all actions which are necessary and appropriate to conduct
the day-to-day operations of

the Company’s business, subject to the supervision of the Board of Managers and
the provisions of this Agreement. No compensation will be paid to any officers
for serving in such capacity, unless such compensation is paid pursuant to an
employment agreement approved by all members of the Board of Managers.

7.5          Annual Budget. The Board of Managers or a committee duly appointed
by the Board of Managers, which committee must include the Manager appointed by
the GCI Member under Section 7.2 (the “Budget Committee”) will require the
appropriate officers, employees and representatives of the Company to prepare
and present an Annual Budget for the Company and its subsidiaries at least
ninety (90) calendar days in advance of the beginning of the applicable Fiscal
Year.

[a]          Each Annual Budget shall cover a one-year period corresponding to a
Fiscal Year, provided that the first Annual Budget shall cover the 12-month
period commencing January 1, 2007. Each Annual Budget shall include an income
statement prepared on an accrual basis which shall show in reasonable detail the
revenues and expenses projected for the operations of the Company and its
subsidiaries for the forthcoming Fiscal Year and a cash flow statement which
shall show in reasonable detail the receipts and disbursements projected for the
operations of Company and its subsidiaries for the forthcoming Fiscal Year, the
amount of any corresponding cash deficiency or surplus, and contemplated
borrowings under credit facilities, if any.

[b]          Such Annual Budget shall be prepared on a basis consistent with the
financial statements of the Company and its subsidiaries and GAAP. The Board of
Managers or the Budget Committee shall review and discuss the proposed Annual
Budget in consultation with the appropriate officers, employees and
representatives of the Company. The proposed Annual Budget shall be deemed
approved if a majority of the Managers then in office approve the Annual Budget,
or if approved by a majority of the members of the Budget Committee. If such
approval is obtained, then such Annual Budget shall for all purposes of this
Agreement constitute the Annual Budget and shall supersede any previously
approved Annual Budget. If such approval is not obtained, then, until a new
budget is approved, the Annual Budget for the Company for the immediately
preceding Fiscal Year will remain in effect, adjusted (without duplication) to
reflect the following increases or decreases: [i] the operation of escalation or
de-escalation provisions in contracts then in effect solely as a result of the
passage of time or contracts entered into pursuant to an approved Annual Budget
or the occurrence of events beyond the control of the Company, to the extent
such contracts are still in effect; [ii] elections made in any prior year under
contracts contemplated by the Annual Budget for the prior year regardless of
which party to such contracts makes such election; [iii] the effect of the
existence of any multi-year contract entered into in accordance with a previous
budget to the extent not fully reflected in the prior year's Annual Budget; [iv]
increases or decreases in expenses attributable to the annualized effect of
employee additions or reductions during the prior year contemplated by the
Annual Budget for the prior year; [v] interest expense attributable to any
loans; [vi] increases or decreases in overhead expenses in an amount equal to
the total of overhead expenses reflected in the Annual Budget for the prior year
(excluding non-recurring items) multiplied by the percentage increase or
decrease in the U.S. Department of Labor Bureau of Labor Statistics Consumer
Price Index for all Urban Consumers or a successor index for the prior Fiscal
Year (but in no event will such

 

[c]

change be more than 10% of the corresponding items in the prior Annual Budget);
and [vii] decreases in expenses attributable to non-recurring items reflected in
the prior year's Annual Budget.

 

[d]

The initial Annual Budget shall be attached hereto as Exhibit E.

7.6  Curative Provision. To the extent the GCI Member’s management rights in the
Company exceed any allowable control requirements for ownership of wireless
communications carriers under any agreement or understanding to which GCI may be
bound or under any law or regulation of any Governmental Authority to which GCI
may be subject, the Members will negotiate in good faith an amendment to this
Agreement that will contain curative provisions regarding voting interests in
the Company.

 

ARTICLE 8.

LIABILITY OF A MEMBER

8.1          Limited Liability. Except as otherwise provided in the Act, the
debts, obligations and liabilities of the Company (whether arising in contract,
tort or otherwise) will be solely the debts, obligations and liabilities of the
Company, and no Member (or former Member) of the Company is liable or will be
obligated personally for any such debt, obligation or liability of the Company
solely by reason of such status. No Manager or Officer of the Company nor any
officer, director, employee or agent of any Member will have any personal
liability for the performance of any obligation of any Member under this
Agreement.

8.2          Capital Contribution. Each Member is liable to the Company for [a]
the Initial Contribution deemed to be made under Section 4.1 and [b] subject to
Section 8.3, any Capital Contribution or Distribution that has been wrongfully
or erroneously returned or made to such Person in violation of the Act, the
Articles or this Agreement.

8.3          Capital Return. Any Member who has received the return of all or
any part of such Member’s Capital Contribution will have no liability to return
such Distribution to the Company after the expiration of the applicable period
of time specified by the Act or other applicable law unless Notice of an
obligation to return is given to such Person within such time period; provided
that if such return of capital has occurred without violation of the Act, the
Articles or this Agreement, such obligation to return capital will apply only to
the extent necessary to discharge the Company’s liability to its creditors who
reasonably relied on such obligation in extending credit prior to such return of
capital.

8.4          Reliance. Any Member will be fully protected in relying in good
faith upon the records of the Company and upon such information, opinions,
reports or statements by [a] any of the Company’s other Members, Board of
Managers or Officers or [b] any other Person who has been selected with
reasonable care as to matters such Member reasonably believes are within such
other Person’s professional or expert competence. Matters as to which such
reliance may be made include the value and amount of assets, liabilities,
Profits and Losses of the Company, as well as other facts pertinent to the
existence and amount of assets from which Distributions to Members might
properly be made.

 

ARTICLE 9.

INDEMNIFICATION

9.1          General. To the full extent permitted by law, the Company will
indemnify, defend and hold harmless each Member (and each such Member’s
shareholders, directors, officers, partners, members, employees, Affiliates and
agents), Manager and each Officer of the Company (collectively, “Indemnified
Persons”) from and against any and all claims, damages, causes of action,
losses, expenses (including reasonable fees and expenses of attorneys and other
advisors and any court costs incurred by such Indemnified Person) and
liabilities (collectively, “Damages”) arising from or in connection with the
business or affairs of the Company, the preservation of the business and
property of the Company or the defense or disposition of any claim, demand or
Proceeding in which such Indemnified Person may be involved or with which such
Indemnified Person may be threatened to be involved, as a party or otherwise
because such Person was a Member, Manager or Officer (or was a shareholder,
director, officer, partner, member, employee, Affiliate or agent of a Member) or
acted or failed to act with respect to the business or affairs of the Company if
[a] such Person acted in good faith, [b] such Person reasonably believed that
its conduct in an official capacity was in the Company’s best interests or, if
the conduct was not in an official capacity, that its conduct was at least not
opposed to the Company’s best interests and [c] such Person, in the case of any
criminal Proceeding, had no reasonable cause to believe its conduct was
unlawful. The termination of any action or Proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent will
not of itself create a presumption that indemnification is not available under
this Agreement.

9.2          Exception. Notwithstanding the general rule stated in Section 9.1,
the Company will not indemnify any Person in connection with [a] any Proceeding
by or in right of the Company in which such Person was adjudged liable to the
Company, or [b] in connection with any Proceeding charging improper personal
benefit to such Person (or another Person of which such Person is or was a
shareholder, director, officer, partner, member, employee or agent) (whether or
not involving action in an official capacity) in which such Person was adjudged
liable on the basis that personal benefit was improperly received.

9.3          Expense Advancement. With respect to the reasonable expenses
incurred by an Indemnified Person who is a party to a Proceeding, the Company
may provide funds to such Person (and, in the case of a Member, to the
shareholders, directors, officers, partners, members, employees, Affiliates and
agents of such Person) in advance of the final disposition of the Proceeding if
[a] such Person furnishes the Company with such Person’s written affirmation of
a good-faith belief that it has met the standard of conduct described in Section
9.1, [b] such Person agrees in writing to repay the advance if it is determined
that it has not met such standard of conduct and [c] the Company determines
that, based on then known facts, indemnification is permissible under this
Article.

9.4          Insurance. The indemnification provisions of this Article do not
limit any Person’s right to recover under any insurance policy maintained by the
Company. If, with respect to any loss, damage, expense or liability described in
Section 9.1, any Person receives an insurance policy indemnification payment
that, together with any indemnification payment made

by the Company, exceeds the amount of such loss, damage, expense or liability,
then such Person will immediately repay such excess to the Company.

9.5          Indemnification of Others. To the same extent that the Company will
indemnify and advance expenses to a Member, the Company may indemnify and
advance expenses to any employee or agent of the Company. In addition, the
Company, in its discretion, may indemnify and advance expenses to any employee
or agent to a greater extent than a Member.

9.6          Exculpation. No Indemnified Person will be liable to the Company or
any other Member for any Damages incurred by reason of any act or omission
performed or omitted by such Indemnified Person in good faith on behalf of the
Company and in a manner reasonably believed to be within the scope of the
authority conferred on the applicable Member, Manager or Officer by this
Agreement, except that an Indemnified Person will be liable to the Company for
any such Damages incurred by reason of such Indemnified Person’s willful
misconduct.

9.7          Rights Not Exclusive. The rights accruing to each Indemnified
Person under this Article 9 will not exclude any other right to which such
Indemnified Person may be lawfully entitled.

 

ARTICLE 10.

ACCOUNTING AND REPORTING

10.1       Fiscal Year. For income tax and accounting purposes, the fiscal year
of the Company will be the Fiscal Year.

10.2       Tax Accounting Method. For income tax purposes, the Company will use
the accrual method of accounting, unless otherwise required by the Code. The Tax
Matters Partner will have the authority to adopt all other accounting methods
for tax purposes.

10.3       Tax Elections. Notwithstanding any other provision of this Agreement,
no Member, Manager or employee of the Company may take any action (including,
but not limited to, the filing of a U.S. Treasury Form 8832 Entity
Classification Election) which would cause the Company to be characterized as an
entity other than a partnership for U.S. federal income tax purposes without the
consent of the GCI Member. The Tax Matters Partner will have the authority to
make any other tax elections, and to revoke any such election, as the Tax
Matters Partner may from time to time determine. Notwithstanding the preceding
sentence, following any Transfer (within the meaning of § 754 of the Code) of a
Unit, the Tax Matters Partner will make the election under § 754 of the Code.

10.4       Returns. At the expense of the Company, the Tax Matters Partner will
cause the preparation and timely filing of all tax returns required to be filed
by the Company pursuant to the Code, as well as all other tax returns required
in each jurisdiction in which the Company does business.

10.5       Reports; Annual Financial Statements; Regulatory Reporting
Obligations. The Company will prepare or will cause the preparation of within
the time frames requested by the GCI Member from time to time, such financial
statements of the Company and other

financial information prepared in accordance with GAAP as GCI may require (the
“GCI Requested Financial Information”), as reasonably determined by GCI, to
enable it to consolidate the Company’s results of operations with GCI’s results
of operations for purposes of U.S. financial accounting reporting rules and
regulations and to meet on a timely basis, GCI’s reporting or other obligations
under applicable law, the rules and regulations promulgated thereunder and
interpretations thereof by the applicable regulatory authority or its staff,
including, without limitation, the U.S. Securities Act of 1933, as amended, and
the U.S. Securities Exchange Act of 1934, as amended. The Company will provide
such GCI Requested Financial Information to GCI within 10 to 13 days of each
fiscal year, quarter or month end, as applicable, or such shorter time period as
may be required by GCI pursuant to the preceding sentence. The Company shall
within the time frame requested by the GCI Member from time to time, take such
action or produce such other information, statements and reports, as may be
required by applicable stock exchange or stock associations rules or by
applicable law, the rules and regulations promulgated thereunder or
interpretations thereof by the applicable regulatory authority or its staff, as
reasonably determined by the GCI Member to timely meet its or its Affiliates’
disclosure, reporting or other obligations under the rules of any stock exchange
or stock association on which its shares are listed and under any applicable law
and the rules and regulations promulgated thereunder or interpretations thereof
by the applicable regulatory authority or its staff, including, without
limitation, the U.S. Securities Act of 1933, as amended, the U.S. Securities
Exchange Act of 1934, as amended, and the Sarbanes-Oxley Act of 2002, as
amended.

 

10.6

Books and Records.

[a]          The following books and records of the Company will be kept at its
principal office: [i] a current list of the full name and last known business,
residence or mailing address of each Member; [ii] originals of the Articles and
of this Agreement, as amended (as well as any signed powers of attorney pursuant
to which any such document was executed); [iii] a copy of the Company’s federal,
state and local income tax returns and reports and annual financial statements
of the Company, for the ten most recent years; and [iv] minutes, or minutes of
action or written consent, of every meeting of Members of the Company.

[b]          The Company will keep at the Company’s principal office separate
books of account for the Company which will show a true and accurate record of
all costs and expenses incurred, all credits made and received, and all income
derived in connection with the operation of the Company in accordance with GAAP
consistently applied as to the Company’s financial position and results of
operations.

[c]          Each Member will have the right, at any time with reasonable Notice
to the Board of Managers and at such Member’s sole expense, to examine, copy and
audit the Company’s books and records during normal business hours. All books
and records (including bills and invoices), reports and returns of the Company
required by this Article will be maintained in a commercially reasonable manner
as reasonably determined by the Board of Managers.

 

10.7

Information.

[a]          Each Member has the right, from time to time and upon reasonable
demand for any purpose reasonably related to such Person’s interest as a Member
of the Company, to obtain from the Company: [i] a current list of the full name
and last known business, residence or mailing address of each Member; [ii] a
copy of the Articles and of this Agreement, as amended (as well as any signed
powers of attorney pursuant to which any such document was executed); [iii] a
copy of the Company’s federal, state and local income tax returns and reports
and annual financial statements of the Company, for the six most recent years;
[iv] minutes, or minutes of action or written consent, of every meeting of the
Members of the Company and the Board of Managers; [v] true and full information
regarding the amount of money and a description and statement of the agreed
value of any other property or services contributed or to be contributed by each
Member, and the date on which each became a Member; [vi] true and full
information regarding the status of the business and financial condition of the
Company; and [vii] other information regarding the affairs of the Company as is
just and reasonable. Any demand by a Member under this 10.7 must be by Notice to
the Company, and must state the purpose of the demand. Any inspection or copying
of the Company’s books and records under this 10.7 will be during normal
business hours, and at the expense of the Member making the demand.

[b]          The Board of Managers will cause the Company to provide to each
Member [i] not more than ten days following the end of the fiscal quarter, an
estimate of any taxable income or gain to be allocated to such Member for such
fiscal quarter and [ii] not more than 75 days after each Fiscal Year end, such
information for such Fiscal Year as the Member reasonably requires to prepare
tax returns or reports required to be filed by it or one or more of its
Affiliates, including federal and state tax information and projections and
estimates.

 

10.8       Banking. The Company may establish and maintain one or more accounts
or safe deposit boxes at banks or other financial institutions. The Company may
authorize one or more individuals to sign checks on and withdraw funds from such
bank or financial accounts and to have access to such safe deposit boxes, and
may place such limitations and restrictions on such authority as the Company
deems advisable. No funds of the Company will be commingled with funds of any
Member or any other Person.

10.9       Tax Matters; Tax Matters Partner. Until further action by the
Company, the GCI Member (or any Transferee of a majority of the Units owned by
such Member) is designated as the Tax Matters Partner under § 6231(a)(7) of the
Code. The Tax Matters Partner will take no action that is reasonably expected to
have a material adverse effect on one or more of the Members unless such action
is approved by the unanimous Vote of the Members. The Tax Matters Partner will
be responsible for notifying all Members of ongoing tax Proceedings, both
administrative and judicial, and will represent the Company throughout any such
Proceeding. The Members will furnish the Tax Matters Partner with such
information as it may reasonably request to provide the Internal Revenue Service
with sufficient information to allow proper

notice to the Members. If an administrative Proceeding with respect to a
partnership item under the Code has begun, and the Tax Matters Partner so
requests, each Member will notify the Tax Matters Partner of its treatment of
any partnership item on its federal income tax return, if any, which is
inconsistent with the treatment of that item on the partnership return for the
Company. Any settlement agreement with the Internal Revenue Service will be
binding upon the Members only as provided in the Code. The Tax Matters Partner
will not bind any other Member to any extension of the statute of limitations or
to a settlement agreement without such Member’s written consent. Any Member who
enters into a settlement agreement with respect to any partnership item will
notify the other Members of such settlement agreement and its terms within 30
days after the date of settlement. If the Tax Matters Partner does not file a
petition for readjustment of the partnership items in the Tax Court, federal
District Court or Claims Court within the 90-day period following a notice of a
final partnership administrative adjustment, any notice partner or 5-percent
group (as such terms are defined in the Code) may institute such action within
the following 60 days. The Tax Matters Partner will timely notify the other
Members in writing of its decision. Any notice partner or 5-percent group will
notify the other Members of its filing of any petition for readjustment.

10.10     Classification of Company as Partnership for Tax Purposes, Not State
Law. The Company will be classified as a partnership for federal (and, as
appropriate, state and local) income tax purposes. This characterization, solely
for tax purposes, does not create or imply a general partnership or limited
partnership among the Members for state law or any other purpose. Instead, the
Members acknowledge the status of the Company as a limited liability company
formed under the Act. All duties and obligations of the Members to each other
are expressly set forth in this Agreement. Without limiting the foregoing, the
Members do not owe to each other or to the Company the duties that a general
partner owes to a partnership and its other partners nor do the Managers owe
such duties to each other, the Company or its Members, it being acknowledged
that the duties owed by the Managers to each other and the Company are as set
forth in Article 9. The Members do not have any express or implied fiduciary
duties to the Company or each other except the fiduciary duties, if any, that
shareholders in an Alaska corporation might have to each other or the
corporation.

 

ARTICLE 11.

DISSOLUTION

11.1       Dissolution. Dissolution of the Company will occur upon the happening
of any of the following events:

[a]          The affirmative Vote of Members owning more than 90% of the
outstanding Common Units;

[b]          The sale, lease or other disposition of all or substantially all of
the assets of the Company in any transaction or series of transactions;

 

[c]

Entry of a decree of judicial dissolution under the Act;

[d]          an event of Withdrawal (as defined in Section 11.2) of a Member and
the election of the remaining Members to dissolve in accordance with Section
11.3; or

 

[e]

if either the GCI Member or any Non-GCI Member has materially breached a
material provision of this Agreement and such breach has not been cured within
30 days after receipt of a Notice from the non-breaching Member providing
reasonable detail concerning the nature of the breach, then upon the election of
the non-breaching Member.

11.2       Events of Withdrawal. An event of Withdrawal of a Member occurs when
any of the following occurs:

[a]          with respect to any Member, upon the Transfer of all of such
Member’s Units (which may only be done as otherwise permitted under this
Agreement and which Transfer is treated as a resignation);

[b]          with respect to any Member, upon the voluntary withdrawal,
retirement or resignation of the Member by Notice to the Company;

[c]          with respect to any Member that is a corporation, upon filing of
articles of dissolution of the corporation;

[d]          with respect to any Member that is a partnership, a limited
liability company or a similar entity, upon dissolution and liquidation of such
entity (but not solely by reason of a technical termination under § 708(b)(1)(B)
of the Code); or

 

[e]

with respect to any Member, the Bankruptcy of the Member.

Within 10 days following the happening of any event of Withdrawal with respect
to a Member, such Member must give Notice of the date and the nature of such
event to the Company.

11.3       Continuation. In the event of Withdrawal of a Member, the Company
will be continued unless the remaining Members (including the Permitted
Transferee of a withdrawing Member, if applicable) unanimously elect to
dissolve. If the Company is so continued, any Member as to which an event of
Withdrawal specified in Sections 11.2[b] through 11.2[e] has occurred, or such
Member’s Transferee or other successor-in-interest (as the case may be) if a
Member has made a Transfer in violation of this Agreement and such Transfer is
found not to be null and void, will, without further act, become a “Limited
Owner” of its own Units or the Units of the withdrawn Member. A Limited Owner
has no right: [a] to participate or interfere in the management or
administration of the Company’s business or affairs, including by virtue of
appointment of one or more Managers, [b] to vote or agree on any matter
affecting the Company or any Member, [c] to require any information on account
of Company transactions or [iv] except as provided in the next succeeding
sentence, to inspect the Company’s books and records. The only rights of a
Limited Owner are: [i] to obtain the information specified in Section 10.7 if it
executes a confidentiality agreement (in form and substance satisfactory to the
Board of Managers) concerning such information if not already bound by Section
10.7, [ii] to receive the allocations and Distributions to which the Units of
the Limited Owner are entitled and [iii] to receive all necessary tax reporting
information. Neither the Company, the Board of Managers nor the Members will owe
any fiduciary duty of any nature to a Limited Owner. However, each Limited Owner
will be subject to all of the obligations, restrictions and other terms
contained in this Agreement as if it were a Member.

 

ARTICLE 12.

LIQUIDATION

12.1       Liquidation. Upon Dissolution of the Company, the Company immediately
will proceed to wind up its affairs and liquidate pursuant to this Section 12.1.
If there is only one remaining Member, that Member will act as the liquidating
trustee. Otherwise, any Person appointed by the affirmative Vote of Members
owning more than 50% of the outstanding Units will act as the liquidating
trustee. The Liquidation of the Company will be accomplished in a businesslike
manner as determined by the liquidating trustee. A reasonable time will be
allowed for the orderly Liquidation of the Company and the discharge of
liabilities to creditors so as to enable the Company to minimize any losses
attendant upon Liquidation. Any gain or loss on disposition of any Company
assets in Liquidation will be allocated to Members in accordance with the
provisions of Article 5. Any liquidating trustee is entitled to reasonable
compensation for services actually performed, and may contract for such
assistance in the liquidating process as such Person deems necessary or
desirable. Until the filing of a certificate canceling the Articles under
Section 12.8, and without affecting the liability of the Members and without
imposing liability on the liquidating trustee, the liquidating trustee may
settle and close the Company’s business, prosecute and defend suits, dispose of
its property, discharge or make provision for its liabilities, and make
Distributions in accordance with the priorities set forth in this Article.

12.2

[Reserved].

12.3       Priority of Payment. The assets of the Company will be distributed in
Liquidation in the following order:

[a]          First, to creditors by the payment or provision for payment of the
debts and liabilities of the Company and the expenses of Liquidation, including
the setting up of any reserves that are reasonably necessary for any contingent,
conditional or unmatured liabilities or obligations of the Company;

[b]          Second, to the Members that own Units in proportion to the positive
balances in their respective Capital Accounts, measured immediately following
the Capital Account adjustments arising from the transactions contemplated by
Sections 2.2, 2.3 and 2.4 of the Reorganization Agreement; and

[c]          Third, to the Members that own Units in proportion to the positive
balances in their respective Capital Accounts for their Units after such Capital
Accounts have been adjusted to account for the distributions contemplated by
Section 12.3[b] and after such Capital Accounts have been adjusted for all
allocations of Profits and Losses and items thereof for the Fiscal Year during
which such Liquidation occurs.

12.4       Liquidating Distributions. Liquidating Distributions will be made by
distributing the assets of the Company in kind to the Members in proportion to
the amounts distributable to them pursuant to Section 12.3, valuing such assets
at their Fair Market Value (net of liabilities secured by such property that the
Member takes subject to or assumes that were not taken into account in
determining the Fair Market Value of such assets) on the date of Distribution.

Notwithstanding the preceding sentence, but only upon the affirmative Vote of
Members owning more than 50% of the outstanding Units, liquidating Distributions
may be made by selling the assets of the Company and distributing the net
proceeds. Each Member receiving a liquidating Distribution in kind agrees to
save and hold harmless the other Members from any and all liabilities assumed by
such Member or to which assets distributed to such Member are taken subject by
such Member. Appropriate and customary prorations and adjustments will be made
incident to any Distribution in kind. The Members will look solely to the assets
of the Company for the return of their Capital Contributions, and if the assets
of the Company remaining after the payment or discharge of the debts and
liabilities of the Company are insufficient to return such contributions, they
will have no recourse against any other Member. The Members acknowledge that
Section 12.3 may establish Distribution priorities on Liquidation different from
those set forth in the Act, as in effect at the time of any Distribution; and,
in such event, it is the Members’ intention that the provisions of Section 12.3
will control, to the extent possible.

 

12.5       No Restoration Obligation. Except as otherwise specifically provided
in Sections 8.2 and 8.3, nothing contained in this Agreement imposes on any
Member an obligation to make an Additional Contribution in order to restore a
deficit Capital Account upon Liquidation of the Company.

12.6       Timing. Final Distributions in Liquidation will be made by the later
of [a] the date that all necessary consents from any governmental authorities or
third parties are obtained to make an in kind Distribution of any assets, or [b]
the end of the Company’s Fiscal Year in which such actual Liquidation occurs
(or, if later, within 90 days after such event) in the manner required to comply
with the § 704(b) Regulations. Payments or Distributions in Liquidation may be
made to a liquidating trust established by the Company for the benefit of those
entitled to payments under Section 12.3, in any manner consistent with this
Agreement and the § 704(b) Regulations.

12.7       Liquidating Reports. A report will be submitted with each liquidating
Distribution to Members made pursuant to Section 12.4, showing the collections,
disbursements and Distributions during the period that is subsequent to any
previous report. A final report, showing cumulative collections, disbursements
and Distributions, will be submitted upon completion of the Liquidation.

12.8       Articles of Dissolution. Upon Dissolution of the Company and the
completion of the winding up of its business, the Company will file Articles of
Dissolution (to cancel the Articles) with the Alaska Department of Commerce,
Community, and Economic Development pursuant to the Act. At such time, the
Company will also file an application for withdrawal of its certificate of
authority in any jurisdiction where it is then qualified to do business.

 

ARTICLE 13.

TRANSFER RESTRICTIONS

13.1       General Rule. Except as otherwise provided in Section 13.2, no Member
may directly or indirectly Transfer (including by a direct or indirect Transfer
of equity interests in or voting rights with respect to the Member, except that
a Transfer of equity interests in the GCI Member or a Non-GCI Member will not
constitute a Transfer of any Units held by such Member) any of its Common Units
without the approval of all members of the Board of Managers, subject in all
cases to satisfaction of the conditions set forth in Section 13.4 below. The
Profits Interest Units shall not be transferable, except as provided in Article
14 below. Any attempt to Transfer Units in violation of this Agreement will be
void ab initio, the Company will not register such attempted Transfer in its
records and any purported Transferee will not be recognized as the holder of
such Units.

 

13.2       Permitted Transfers. Any transfer of Common Units contemplated by
Section 2.4 of the Reorganization Agreement will be permitted without approval
of all members of the Board of Managers. In addition, a Transfer of Common Units
to a Person that is an Affiliate of a Member will be permitted without approval
of all members of the Board of Managers, so long as any such Person that is an
Affiliate of such Member continues to be an Affiliate of such Member at all
times while it owns any Common Units. If at any time an Affiliate of a Member to
whom a Member has Transferred Common Units under this Section 13.2 ceases to be
an Affiliate of such Member, prior to such cessation such Person will Transfer
its Common Units back to such Member or to an Affiliate of such Member. Any
Transfer of Common Units under this Section 13.2 shall be subject to the
satisfaction of the conditions set forth in Section 13.4.

13.3       Permitted Pledges. Any pledge of Common Units pursuant to a bona fide
loan transaction or any hedging transaction affecting all or any part of a
Member’s Common Units will not in itself constitute a Transfer hereunder or
cause the Member to cease to be a Member provided that [a] the Member owning
such Common Units gives Notice to the other Members of such pledge or hedge at
least ten days prior to effecting it and [b] the pledgee or counterparty to the
hedging transaction, as applicable, agrees in writing to be bound by and comply
with all provisions of this Agreement applicable to the Member effecting such
pledge or hedge. Any transfer of title to, or beneficial interest in, any Common
Units to a pledgee upon foreclosure or to a counterparty to a hedging
transaction upon physical settlement of such hedging transaction will be subject
to the transfer restrictions under this Article 13. Any Transfer of Units under
this Section 13.3 shall be subject to the satisfaction of the conditions set
forth in Section 13.4.

13.4       General Conditions on Transfer. No Transfer of a Unit will be
effective unless all the conditions set forth below are satisfied:

[a]   Unless waived by each nontransferring Member, the Transferor signs and
delivers to the Company an undertaking in form and substance satisfactory to the
Company to pay all reasonable expenses incurred by the Company in connection
with the Transfer (including reasonable fees of counsel and accountants and the
costs to be incurred with any additional accounting required in connection with
the Transfer, and the cost and fees attributable to

**** CONFIDENTIAL TREATMENT

preparing, filing and recording such amendments to the Articles or other
organizational documents or filings as may be required by law);

 

[b]   Unless waived by each nontransferring Member, the Transferor delivers to
the Company [i] an opinion of counsel for the Transferor reasonably satisfactory
in form and substance to the Company to the effect that, assuming the accuracy
of the statement of the Transferee described in [ii] below, the Transfer of the
Units as proposed does not violate requirements for registration under
applicable federal and state securities laws and [ii] a statement of the
Transferee in form and substance reasonably satisfactory to the Company making
appropriate representations and warranties with respect to compliance with the
applicable federal and state securities laws and as to any other matter
reasonably required by the Company;

[c]   The Transferor signs and delivers to the Company a copy of the assignment
of the Units to the Transferee (substantially in the form of the attached
Exhibit A or such other form as reasonably acceptable to the Company), which
assignment will provide that the Transferor will continue to be liable for the
performance of its liabilities under this Agreement; and

[d]   Unless the Transferee is already a Member, the Transferee signs and
delivers to the Company an agreement (substantially in the form of the attached
Exhibit B or such other form as reasonably acceptable to the Company) to be
bound by this Agreement.

The Transfer of the Units will be effective as of 12:01 a.m. (Alaska Time) on
the first day on which all of the above conditions have been satisfied. The
Company will amend Schedule 1.3 as of the effective time of any Transfer of any
Units to give effect to such Transfer. No consent of any Member will be
necessary to make any such amendment to Schedule 1.3.

13.5       Rights of Transferees. Any Transferee acquiring Units in compliance
with this Agreement will become a Member automatically on the effective date of
the Transfer

 

ARTICLE 14.

liquidity rightS.

 

14.1

Call Rights.

[a]          **** – ****. At **** following the **** and **** on the ****
following the **** of ****, the **** may **** the **** to **** the ****, of the
**** by the ****, at **** [i] the **** accordance **** of ****, or [ii] the ****
the **** following the ****. The **** must **** this **** this **** at **** the
****. Upon **** by the **** of the **** of the **** will be **** and **** or
**** in ****.

[b]          **** – ****. At **** the **** and **** on the **** following the
**** of ****, the **** may **** the **** to **** the ****, of the **** by the
****, at **** [i] the ****

**** CONFIDENTIAL TREATMENT

[c]          accordance **** of ****, or [ii] the **** the ****. The **** must
**** this **** the **** at **** the ****. Upon **** by the **** of the ****, [A]
**** that the **** the ****, the **** from the **** and the **** the **** the
**** in **** for a **** the **** of such ****; and [B] **** that the **** the
**** of the **** by the **** and **** in the ****.

[d]          **** – ****. At **** of the ****, the **** may **** the **** the
****, of the **** the **** the **** of such ****. The **** must **** to the ****
the **** of the ****. Upon the **** of such **** by the **** of the ****, the
**** from the **** and the **** the **** of the **** the **** in **** for a ****
the **** of such ****.

[e]          **** – ****. At **** at **** on the **** following the ****
following the ****, the **** may **** the **** the ****, of the **** by the
****, at a **** the **** of such ****. The **** this **** the **** the **** of
the ****. As a **** the ****, concurrent with the ****, the **** the **** with
**** to the **** that the **** have the **** the **** at the time the **** or
that the **** has the **** a **** the **** at the **** of such ****. If the ****
the **** set forth in this Section 14.1[d], the ****, within **** of the ****
any **** that it has to **** the **** pursuant to Section 14.1[a], 14.1[b] or
14.1[c] (in each case including ****, which shall **** the **** set forth in
this Section 14.1[d].

[f]           ****. The **** of **** and **** under this Section 14.1 **** at
such **** and **** to such **** in ****.

 

14.2

****.

[a]          ****. At **** the **** following the ****, the **** may **** the
****, of the **** by the ****, at a **** the **** of such ****. The **** this
**** the **** this **** at **** following the ****. At the **** the **** the
**** of the ****, the **** may **** the ****, of the **** the **** in **** a
**** the **** of such Profits Interest Units.

[b]          ****. At **** the **** following the ****, the **** may **** the
**** or the **** the ****, at a **** the **** of such ****. The **** this **** a
**** whichever of the **** or the **** that **** in the **** following the ****
following the ****. In order ****, the **** reasonably satisfied that the ****
in the **** then **** for the **** or **** at the **** of such ****. The ****,
as applicable, will cooperate in all respects **** that the **** and, if
necessary, the **** or the **** to procure **** for such a ****.

[c]          ****. The **** of **** and **** under this Section 14.2 **** at
such **** and **** to such **** in ****.

14.3       Determination of Appraised Unit Value. For purposes of this
Agreement, “Appraised Unit Value” with respect to Common Units shall mean the
Fair Market Value of all, but not less than all, of the Common Units owned by
the Member whose Common Units are ****, and if applicable, the Fair Market Value
of all, but not less than all, of the Profits Interest Units owned by the Fire
Lake Member, in each case with no discount or premium for the fact that such
Units represent a minority or a controlling interest in the Company. When the

**** CONFIDENTIAL TREATMENT

Appraised Unit Value of Common Units and/or Profits Interest Units are to be
determined ****, each will be determined as agreed by the GCI Member and the AKD
Holdings Member or if the GCI Member and the AKD Holdings Member fail to agree
on the Appraised Unit Value and such failure to agree continues for 10 Business
Days after the **** has been delivered, then as determined pursuant to the
following appraisal procedure:

[a]          Each of the GCI Member and the AKD Holdings Member will, within 10
Business Days after the deadline for the GCI Member and the AKD Holdings Member
to agree on the Appraised Unit Value, appoint a Qualified Appraiser who will be
required as part of its appointment to determine, using an Authorized Valuation
Methodology, the Appraised Unit Value of the Common Units and/or the Profits
Interest Units and deliver its written independent appraisal thereof to the GCI
Member and the AKD Holdings Member within 30 days after its appointment. If
either the GCI Member or the AKD Holdings Member fail to appoint a Qualified
Appraiser within the period provided above, the one Qualified Appraiser
appointed will proceed to make the appraisal alone and its appraisal will be the
applicable Appraised Unit Value, which will be final and binding upon the
Members. “Qualified Appraiser” shall mean a Person experienced in valuing assets
owned by the Company and who has no prior business relationship with any Member
of the Company within the two years prior to its engagement, and the Members
will agree not to hire such Person for six-months following the engagement.
“Authorized Valuation Methodology” shall mean one or more valuation
methodologies customarily used in the evaluation and appraisal of wireless
communications assets, except that any such valuation methodology must be based
on an earnings before interest, taxes, depreciation and amortization analysis
and shall not be based on a revenue or subscriber count analysis.

[b]          If the higher of the two appraisals with respect to the Common
Units and/or the Profits Interest Units is less than 110% of the lower
appraisal, the Appraised Unit Value with respect to such Units will be the
average of the two appraisals. If the higher appraisal with respect to the
Common Units and/or the Profits Interest Units is more than 110% of the lower
appraisal, a third Qualified Appraiser, who will be required as part of its
appointment to determine, using one or more Authorized Valuation Methodologies,
the Appraised Unit Value for such Units within 30 days after its selection and
deliver its written independent appraisal thereof to the GCI Member and the AKD
Holdings Member, must be selected by the two initial Qualified Appraisers within
five Business Days after both initial appraisals have been completed and
delivered to the GCI Member and the AKD Holdings Member. The Appraised Unit
Value with respect to such Units will be the average of the third appraisal and
the one of the first two appraisals that is closest in amount to the third
appraisal.

[c]          In the event of the inability or unwillingness of any Qualified
Appraiser to act, a new Qualified Appraiser must be appointed in its place
within 14 days, such appointment being made in the same manner as provided above
for the appointment of the Qualified Appraiser who is being replaced.

**** CONFIDENTIAL TREATMENT

[d]          The expense of the Qualified Appraiser appointed by the AKD
Holdings Member will be borne by the AKD Holdings Member. The expense of the
Qualified Appraiser appointed by the GCI Member will be borne by the GCI Member.
The expense of a third Qualified Appraiser will be borne half by the AKD
Holdings Member and half by the GCI Member. Notwithstanding the forgoing, the
AKD Holdings Member shall be required to pay the expenses of all Qualified
Appraisers if [i] the Appraised Unit Value is determined under Section 14.1[a],
or [ii] if the Appraised Unit Value determined under Section 14.1[b] is finally
determined to be less than the amount set forth in Section 14.1[b][ii].

[e]          In connection with any appraisals performed pursuant to and in
accordance with this Agreement, all of the applicable appraisers will be subject
to a duty of confidentiality, and all of the parties will cooperate with all
applicable appraisers and will provide such appraisers with all necessary and
appropriate information reasonably requested by such appraisers in connection
with such appraisals.

 

14.4

Closing Procedures.

[a]          Unless otherwise agreed by the applicable parties, the closing of
the purchase and sale of Common Units and/or Profits Interest Units **** will be
completed at 10:00 a.m. local time on a date designated by the Member that
provides the applicable **** that is within 15 days after [i] delivering such
****, or if a determination of the Appraised Unit Value is made pursuant to
Section 14.3, after such determination is made, or [ii] such longer period as is
reasonably required to satisfy all of the conditions set forth in Section
14.4[c]. At the closing, the applicable selling Members will deliver to the
applicable purchasing Member a written instrument of assignment, substantially
in the form attached hereto as Exhibit A, transferring their respective Units to
the purchasing Member free and clear of Liens, and the purchasing Member will
pay the applicable purchase price. The closing will be consummated at the
principal executive offices of the Company unless the GCI Member and the AKD
Holdings Member otherwise agree.

[b]          The Member transferring any Common Units and/or Profits Interest
Units pursuant to Section 14.1 or Section 14.2 shall be deemed to have
represented and warranted that: [i] the purchaser will receive good and valid
title to the applicable Units free and clear of all Liens of any nature
whatsoever; and [ii] all of such Units can be purchased and sold without any
notice to, or consent, approval, order or authorization of, or declaration or
filing with, any other Person other than those already obtained and except for
any required Governmental Approvals.

[c]          The closing of any purchase and sale of Units will be subject to
the satisfaction of the following conditions, it being agreed that the parties
will use Commercially Reasonable Efforts to cause such conditions to be met: [i]
all material consents, notices, approvals, including Governmental Approvals
expressly required with respect to the transactions to be consummated at such
closing will have been obtained; and [ii] there will be no preliminary or
permanent injunction or other order by any court of competent jurisdiction
restricting,

 

[d]

preventing or prohibiting the consummation of the transactions to be consummated
at such closing.

[e]          Unless the applicable parties agree otherwise, the purchase price
on any purchase and sale of Units will be payable by wire transfer of same day
funds to an account at a bank designated by the applicable party, such
designation to be made no less than two Business Days prior to the applicable
closing.

[f]           Except for Sections 13.4[a] and 13.4[b], each of which shall be
deemed to have been waived, all conditions set forth in Section 13.4 must also
be satisfied.

[g]          Notwithstanding the failure of any Member to assign or deliver
certificates representing Units on the applicable closing date as required by
this Section 14.4, from and after the applicable closing date, the purchaser of
the applicable Units shall for all purposes be deemed the record and beneficial
owner of such Units, the selling Member shall have only the right to receive the
applicable purchase price for such Units, without interest, and any certificates
representing the applicable Units shall represent only the right to receive the
applicable purchase price, without interest, upon surrender thereof to the
purchaser.

 

ARTICLE 15.

CERTAIN BUSINESS MATTERS

15.1       Distribution of Assets in Kind. Any distribution of assets by the
Company other than cash will be subject to the receipt of any regulatory or
other approvals and waivers deemed necessary by the Board of Managers. Any
distribution of assets will be made in accordance with the provisions of Article
6.

15.2       Other Business Ventures. Except as provided for in the Management
Agreement, each of the Members and their respective Affiliates may engage in or
possess interests in other businesses or ventures of any nature without regard
to whether such businesses or ventures are or may be deemed to be competitive in
any way with the business of the Company or of any Person in which the Company
holds an equity interest. Except as provided for in the Management Agreement, no
Member will have any obligation to offer any business or investment opportunity
to the Company.

15.3       Confidentiality.[a]             Each Member covenants and agrees that
so long as he is a Member and thereafter, it will not [i] disclose to any other
Person any Confidential Information (hereinafter defined), except for
disclosures to Members, Managers, key employees, independent accountants and
attorneys of the Company as may be necessary or appropriate in the performance
of a Member’s duties hereunder; or [ii] use any Confidential Information for any
purpose other than the Company’s business. Each Member covenants and agrees to
cause its respective officers, directors and other representatives, including,
without limitation, each Manager appointed by such Member to the Board of
Managers (collectively, “Representatives”) to observe all terms of this
Agreement and shall be responsible for any breach of this Section 15.3 by any of
its Representatives.

 

[b]

The term “Confidential Information” means and includes any and all non-public
and proprietary information regarding the assets, liabilities, operations,
business, affairs, financing, services, products and trade secrets of the
Company, any of its Affiliates or any of their respective officers, directors,
shareholders, partners, members, employees or agents. The term “Confidential
Information” shall include, without limitation, all financial statements,
financial information, projections, forecasts, business plans, methods, ideas,
concepts, materials, documents, records, computer programs, customer lists,
referral sources, work, models, processes, designs, drawings, plans, inventions,
devices, parts, improvements, other physical and intellectual property or other
information in any form whatsoever; provided, however, the term “Confidential
Information” shall not include any information which [i] at the time of
disclosure or thereafter is generally available to and known by the public
(other than as a result of its disclosure by a Member or its Representatives in
breach of this Section 15.3), [ii] was available to the Member on a
non-confidential basis prior to disclosure by the Company, [iii] becomes
available to the Member on a non-confidential basis from a Third Party who is
not bound by a confidentiality agreement with the Company, or is not otherwise
prohibited from transmitting the information to such Member, or [iv] GCI may
need to disclose under any applicable law or stock exchange rule as a
consequence of it being a public reporting company under the Securities Exchange
Act of 1934.

[c]          The Confidential Information shall remain the property of the
Company; no rights, to use, license or otherwise exploit the Confidential
Information are granted to any Member by implication or otherwise; and no Member
shall by virtue of the disclosure of the Confidential Information and/or the
Member’s use of the Confidential Information acquire any rights with respect
thereto, all of which rights shall remain exclusively with the Company.

[d]          Each Member acknowledges and agrees that the Company would be
irreparably damaged by any unauthorized disclosure or use of any Confidential
Information by a Member or its Representatives. Accordingly, without prejudice
to the rights and remedies otherwise available to the Company, each Member
agrees that the Company shall be entitled, without the requirement of posting a
bond or other security, to equitable relief, including an injunction or specific
performance, from any court of competent jurisdiction, wherever located, in the
event of any breach or threatened breach of the provisions of this Section 15.3
by a Member or its Representatives. Such remedies shall not be deemed to be
exclusive remedies but shall be in addition to all other remedies available at
law or equity to the Company.

[e]          In the event that a Member or any of its Representatives become
legally compelled (by deposition, interrogatory, request for documents,
subpoena, civil investigation, demand, order or other legal process) to disclose
any Confidential Information, or is legally required or requested by any
regulatory or self-regulatory organization to disclose any Confidential
Information, such Member and its Representatives may do so without liability,
provided Recipient [i] promptly notifies the Company prior to any such
disclosure, [ii] cooperates with the Company in any attempts it may make to
obtain a protective order or other appropriate assurance that confidential
treatment will be afforded the Confidential Information and [iii] strictly limit
any such disclosure to that which is expressly required by the terms of the
legal action or regulatory or self regulatory organization compelling such
disclosure.

 

[f]

The obligations of this Section 15.3 shall survive the termination of this
Agreement and any Dissolution and Liquidation of the Company.

 

ARTICLE 16.

GENERAL PROVISIONS

16.1       Amendment. Except as otherwise provided in this Agreement, this
Agreement may be amended in a writing signed by Members who own more than 50% of
the outstanding Units; provided, however, that [a] no amendment that would
require any Member to make an additional Capital Contribution to the Company or
impose personal liability on a Member for any debt, obligation or liability of
the Company shall be effective unless set forth in a writing signed by such
Member; [b] no amendment that would change adversely the rights and or
obligations of the holders of a Profits Interest Unit in a manner that is
different than its effect on the rights or obligations of the holders of Common
Units shall be effective unless approved by the holders of two-thirds of the
outstanding Profits Interest Units; [c] except for an amendment required in
connection with the admission of an additional Member in accordance with the
terms of this Agreement, modify or alter the method of determining, the order of
priority or the interest of a Member in [i] allocations of Profits or Losses,
[ii] allocations or Distributions of Available Cash, or [iii] allocation or
Distribution of proceeds resulting from the Liquidation of the Company, unless
such amendment receives the affirmative vote or written consent of each Member
adversely affected thereby; or [d] amend the provisions of Sections 7.1 or 7.2
unless approved by the holders of 90% of the Common Units. Any duly adopted
amendment to this Agreement is binding on, and inures to the benefit of, each
Person who holds a Unit at the time of such amendment, without the requirement
that such Person sign the amendment or any republication or restatement of this
Agreement.

16.2       Representations. Each Member hereby represents and warrants to each
other Member that, as of the signing of this Agreement:

[a]          Such Member is duly organized, validly existing and in good
standing under the laws of the jurisdiction where it purports to be organized,
and is a United States Person;

[b]          Such Member has full power and authority as a corporation or
limited liability company to enter into and perform its obligations under this
Agreement;

[c]          All actions on the part of such Member necessary to authorize the
signing and delivery of this Agreement, and the performance by such Member of
its obligations hereunder, have been duly taken;

[d]          This Agreement has been duly signed and delivered by a duly
authorized officer or other representative of such Member and constitutes the
legal, valid and binding obligation of such Member enforceable in accordance
with its terms, except as such enforceability may be affected by applicable
bankruptcy, insolvency or other similar laws affecting creditors’ rights
generally, and except that the availability of equitable remedies is subject to
judicial discretion;

 

[e]

No consent or approval of any other Person is required in connection with the
signing, delivery and performance of this Agreement and the Reorganization
Agreement by such Member; and

[f]           The signing, delivery and performance of this Agreement and the
Reorganization Agreement do not violate the organizational documents of such
Member or any material agreement to which such Member is a party or by which
such Member is bound.

16.3       Unregistered Interests. Each Member [a] acknowledges that the Units
are being offered and sold without registration under the Securities Act of
1933, as amended, or under similar provisions of state law, [b] represents and
warrants that such Member is acquiring the Units for such Member’s own account,
for investment, and without a view to the distribution of the Units, [c]
represents and warrants that it is an “accredited investor” as defined in Rule
501(a) of the Regulation D under the Securities Act of 1933 and [d] agrees not
to Transfer, or to attempt to Transfer, all or any part of its Units without
registration under the Securities Act of 1933, as amended, and any applicable
state securities laws, unless the Transfer is exempt from such registration
requirements.

16.4       Waiver of Alternative Withdrawal Rights. Each Member hereby waives
and renounces any alternative rights that might otherwise be provided by law
upon the withdrawal of such Person and accepts the provisions under this
Agreement as such Person’s sole entitlement upon the happening of such event.

16.5       Waiver of Partition Right. Each Member hereby waives and renounces
any right that it might otherwise have prior to Dissolution and Liquidation to
institute or maintain any action for partition with respect to any property held
by the Company.

16.6       Waivers Generally. No course of dealing will be deemed to amend or
discharge any provision of this Agreement. No delay in the exercise of any right
will operate as a waiver of such right. No single or partial exercise of any
right will preclude its further exercise. A waiver of any right on any one
occasion will not be construed as a bar to, or waiver of, any such right on any
other occasion.

16.7       Equitable Relief. If any Member proposes or refuses to Transfer all
or any part of its Units in violation of the terms of this Agreement, the
Company or any Member may apply to any court of competent jurisdiction for an
injunctive order prohibiting or requiring such proposed Transfer, and the
Company or any Member may institute and maintain any action or Proceeding
against the Person proposing or refusing to make such Transfer to compel the
specific performance of this Agreement. Any attempted Transfer in violation of
this Agreement is null and void, and of no force and effect. The Person against
whom such action or Proceeding is brought hereby irrevocably waives the claim or
defense that an adequate remedy at law exists, and such Person will not urge in
any such action or proceeding the claim or defense that such remedy at law
exists. The prevailing party in any such proceeding shall be entitled to recover
its costs and expenses, including reasonable attorneys' fees, of preparing for
and participating in the proceeding.

16.8

Arbitration. The Members will attempt in good faith to resolve any controversy
or claim arising out of or relating to this Agreement through discussions
between the senior management of the Members. If these discussions are
unsuccessful, except as provided in Section 16.7, the Members agree that any
action asserting a claim by one Member against another Member hereto arising out
of or relating to this Agreement shall, on the written notice by one Member to
the others, be submitted to binding arbitration to be held in Seattle,
Washington. The arbitration shall be conducted by and in accordance with the
Commercial Arbitration Rules of the American Arbitration Association. The
parties shall hold an initial meeting within thirty (30) days from receipt of
notice from the requesting party of a request for arbitration. Unless otherwise
agreed in writing, they will jointly appoint a mutually acceptable arbitrator
not affiliated with either party. If they are unable to agree upon such
appointment within thirty (30) days of the initial meeting, the parties shall
obtain an odd numbered list of not less than five (5) potential arbitrators from
the Superior Court for the Third Judicial District, State of Alaska. Each party
shall alternatively strike a single name from the list until only one name
remains, with such person to be the arbitrator. The party requesting the
arbitration shall strike the first name. Each party shall pay one-half (½) of
the costs related to the arbitration, unless the arbitrator’s decision provides
otherwise. Each party shall bear its own costs to prepare for and participate in
the arbitration. Each party shall produce at the request of the other party, at
least thirty (30) days in advance of the hearing, all documents to be submitted
at the hearing and such other documents as are relevant to the issues or likely
to lead to relevant information. The arbitrator shall promptly render a written
decision, in accordance with Alaska law and supported by substantial evidence in
the record. The prevailing party shall be entitled to recover reasonable
attorneys’ fees, costs, charges and expended or incurred therein, if the
arbitrator’s decision so provides. Failure to apply Alaska law, or entry of a
decision that is not based on substantial evidence in the record, shall be
additional grounds for modifying or vacating an arbitration decision. Judgment
on any arbitration award shall be entered in any court of competent
jurisdiction. In any subsequent arbitration, the decision in any prior
arbitration of this Agreement shall not be deemed conclusive of the rights among
the parties hereunder.

16.9       Remedies for Breach. The rights and remedies of the Members set forth
in this Agreement are neither mutually exclusive nor exclusive of any right or
remedy provided by law, in equity or otherwise, and all legal remedies (such as
monetary damages) as well as all equitable remedies (such as specific
performance) will be available for any breach or threatened breach of any
provision of this Agreement.

16.10     Costs. If the Company or any Member retains counsel for the purpose of
enforcing or preventing the breach or any threatened breach of any provisions of
this Agreement or for any other remedy relating to it, then the prevailing party
will be entitled to be reimbursed by the nonprevailing party for all costs and
expenses so incurred (including reasonable attorney’s fees, costs of bonds and
fees and expenses for expert witnesses.

16.11     Counterparts. This Agreement may be signed in multiple counterparts,
the signature pages of which may be detached and reattached to another identical
counterpart. Each counterpart will be considered an original instrument, but all
of them in the aggregate will constitute one agreement.

16.12

Notice. All Notices under this Agreement will be in writing and will be either
delivered or sent addressed as follows: [a] if to the Company, at the Company’s
principal office in Anchorage, Alaska, and [b] if to any Member, at such
Person’s address as then appearing in the records of the Company. In computing
time periods, the day Notice is given will be included.

16.13     Deemed Notice. Any Notices given to the Company or any Member in
accordance with this Agreement will be deemed to have been duly given: [a] on
the date of receipt if personally delivered, [b] five days after being sent by
U.S. mail, postage prepaid, [c] on the date of receipt, if sent by registered or
certified U.S. mail, postage prepaid, [d] on the date of receipt, if sent by
facsimile or telecopier transmission (with telephonic confirmation by the
recipient) or [e] one Business Day after having been sent by a nationally
recognized overnight courier service.

16.14     Partial Invalidity. Wherever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law. However, if for any reason any one or more of the provisions of
this Agreement are held to be invalid, illegal or unenforceable in any respect,
such action will not affect any other provision of this Agreement. In such
event, this Agreement will be construed as if such invalid, illegal or
unenforceable provision had never been contained in it.

16.15     Entire Agreement. This Agreement (including its Schedules and
Exhibits) contains the entire agreement and understanding of the Members
concerning its subject matter.

16.16     Benefit. Except as otherwise set forth in Section 9.1, this Agreement
and the rights and obligations of the Members hereunder will inure solely to the
benefit of the Members and their Transferees and the Company, without conferring
on any other Person any rights of enforcement or other rights.

16.17     Further Assurances. Each Member will sign and deliver, without
additional consideration, such other documents of further assurance as may
reasonably be necessary to give effect to the provisions of this Agreement.

16.18     Headings. Article and section titles have been inserted for
convenience of reference only. They are not intended to affect the meaning or
interpretation of this Agreement.

16.19     Terms. Terms used with initial capital letters will have the meanings
specified, applicable to both singular and plural forms, for all purposes of
this Agreement. All pronouns (and any variations) will be deemed to refer to the
masculine, feminine or neuter, as the identity of the Person may require. The
singular or plural includes the other, as the context requires or permits. The
word “include” (and any variation) is used in an illustrative sense rather than
a limiting sense. The word “day” means a calendar day, unless a Business Day is
specified.

16.20     Governing Law. This Agreement will be governed by, and construed in
accordance with, the laws of the State of Alaska. Any conflict or apparent
conflict between this Agreement and the Act will be resolved in favor of this
Agreement, except as otherwise required by the Act.

16.21

No Tax Advice. All Members acknowledge that any tax advice express or implicit
in the provision of this Agreement are not intended or written to be used, and
cannot be used, by any taxpayer for the purpose of avoiding penalties that may
be imposed on tax payer by the Internal Revenue Service. Each Member should seek
advice based on its particular circumstances from an independent tax advisor.

 

[Signature Page Follows]

IN WITNESS WHEREOF, the undersigned have caused this Operating Agreement of
Alaska Digitel, LLC, to be duly executed and delivered, effective from the date
first above mentioned, notwithstanding the actual date of signing.

 

GENERAL COMMUNICATION, INC.

 

By: /s/ William C. Behnke

Name: William C. Behnke

Title: Senior Vice President

 

AKD HOLDINGS, LLC

 

By: /s/ William M. Yandell

Name: William M. Yandell

 

Title: President

 

PACIFICOM HOLDINGS II, LLC

 

By: /s/ William M. Yandell

Name: William M. Yandell

 

Title: President

 

FIRE LAKE PARTNERS, L.L.C.

 

By: /s/ William M. Yandell

Name: William M. Yandell

 

Title: President

 

RED RIVER WIRELESS, LLC

 

By: /s/ William M. Yandell

Name: William M. Yandell

 

Title: President

 

 

LIST OF SCHEDULES

 

Schedule

 

1.3

Names and Addresses of Members

 

4.1

Initial Capital Contributions

 

 

LIST OF EXHIBITS

 

Exhibit

 

A

Form of Assignment of Units

 

B

Form of Transferee’s Agreement

 

C

Form of Management Agreement

 

D

Examples of Adjustments to Common Units and Profits Interest Units Outstanding

 

E                           Initial Budget

 

 

 

 

**** CONFIDENTIAL TREATMENT

SCHEDULE 1.3

 

Names, Addresses and Unit Ownership

of Members

 

Members

Unit Ownership

General Communication, Inc.

2550 Denali Street, Suite 1000

Anchorage, AK 99503

Fax: (907) 868-5676

Attn: Corporate Counsel

 

With a copy of any Notice to:

 

General Communication, Inc.

2550 Denali Street, Suite 1000

Anchorage, AK 99503

Fax: (907) 868-5676

Attn: General Manager & Executive Vice President

 

**** Common Units

 

 

 

 

**** CONFIDENTIAL TREATMENT

 

 

AKD Holdings, LLC

5350 Poplar Avenue, Suite 875
Memphis, TN 38119

Fax: (901) 763-3369

Attn: Stephen M. Roberts

 

With a copy of any Notice to:

 

Jack S. Magids, Esq.

The Bogatin Law Firm, PLC

1661 International Place Drive, Suite 300

Memphis, Tennessee 38120-1431

Fax: (901) 767-2803

 

 

**** Common Units

 

Red River Wireless, LLC

5350 Poplar Avenue, Suite 875
Memphis, TN 38119

Fax: (901) 763-3369

Attn: Stephen M. Roberts

 

With a copy of any Notice to:

 

Jack S. Magids, Esq.

The Bogatin Law Firm, PLC

1661 International Place Drive, Suite 300

Memphis, Tennessee 38120-1431

Fax: (901) 767-2803

 

 

**** Common Units

 

Pacificom Holdings II, LLC

5350 Poplar Avenue, Suite 875
Memphis, TN 38119

Fax: (901) 763-3369

Attn: Stephen M. Roberts

 

With a copy of any Notice to:

 

Jack S. Magids, Esq.

The Bogatin Law Firm, PLC

1661 International Place Drive, Suite 300

Memphis, Tennessee 38120-1431

Fax: (901) 767-2803

 

 

**** Common Units

SCHEDULE 1.3

 

Names, Addresses and Unit Ownership

of Members

 

This Revised Schedule 1.3 reflects the Units owned by each Member following the
transactions contemplated by Sections 2.2 and 2.3 of the Reorganization
Agreement.

 

Members

Unit Ownership

General Communication, Inc.

2550 Denali Street, Suite 1000

Anchorage, AK 99503

Fax: (907) 868-5676

Attn: Corporate Counsel

 

With a copy of any Notice to:

 

General Communication, Inc.

2550 Denali Street, Suite 1000

Anchorage, AK 99503

Fax: (907) 868-5676

Attn: General Manager & Executive Vice President

 

**** Common Units

AKD Holdings, LLC

5350 Poplar Avenue, Suite 875
Memphis, TN 38119

Fax: (901) 763-3369

Attn: Stephen M. Roberts

 

With a copy of any Notice to:

 

Jack S. Magids, Esq.

The Bogatin Law Firm, PLC

1661 International Place Drive, Suite 300

Memphis, Tennessee 38120-1431

Fax: (901) 767-2803

 

 

**** Common Units

 

Red River Wireless, LLC

5350 Poplar Avenue, Suite 875
Memphis, TN 38119

Fax: (901) 763-3369

Attn: Stephen M. Roberts

 

With a copy of any Notice to:

 

Jack S. Magids, Esq.

The Bogatin Law Firm, PLC

1661 International Place Drive, Suite 300

Memphis, Tennessee 38120-1431

Fax: (901) 767-2803

 

 

**** Common Units

 

Pacificom Holdings II, LLC

5350 Poplar Avenue, Suite 875
Memphis, TN 38119

Fax: (901) 763-3369

Attn: Stephen M. Roberts

 

With a copy of any Notice to:

 

Jack S. Magids, Esq.

The Bogatin Law Firm, PLC

1661 International Place Drive, Suite 300

Memphis, Tennessee 38120-1431

Fax: (901) 767-2803

 

 

**** Common Units

 

SCHEDULE 1.3

 

Names, Addresses and Unit Ownership

of Members

 

This Revised Schedule 1.3 reflects the Units owned by each Member following the
transactions contemplated by Sections 2.2, 2.3 and 2.4 of the Reorganization
Agreement.

 

Members

Unit Ownership

General Communication, Inc.

2550 Denali Street, Suite 1000

Anchorage, AK 99503

Fax: (907) 868-5676

Attn: Corporate Counsel

 

With a copy of any Notice to:

 

General Communication, Inc.

2550 Denali Street, Suite 1000

Anchorage, AK 99503

Fax: (907) 868-5676

Attn: General Manager & Executive Vice President

 

**** Common Units

AKD Holdings, LLC

5350 Poplar Avenue, Suite 875
Memphis, TN 38119

Fax: (901) 763-3369

Attn: Stephen M. Roberts

 

With a copy of any Notice to:

 

Jack S. Magids, Esq.

The Bogatin Law Firm, PLC

1661 International Place Drive, Suite 300

Memphis, Tennessee 38120-1431

Fax: (901) 767-2803

 

 

**** Common Units

 

 

SCHEDULE 1.3

 

Names, Addresses and Unit Ownership

of Members

 

This Revised Schedule 1.3 reflects the Units owned by each Member following the
transactions contemplated by Sections 2.2, 2.3, 2.4 and 2.5 of the
Reorganization Agreement.

 

Members

Unit Ownership

General Communication, Inc.

2550 Denali Street, Suite 1000

Anchorage, AK 99503

Fax: (907) 868-5676

Attn: Corporate Counsel

 

With a copy of any Notice to:

 

General Communication, Inc.

2550 Denali Street, Suite 1000

Anchorage, AK 99503

Fax: (907) 868-5676

Attn: General Manager & Executive Vice President

 

**** Common Units

AKD Holdings, LLC

5350 Poplar Avenue, Suite 875
Memphis, TN 38119

Fax: (901) 763-3369

Attn: Stephen M. Roberts

 

With a copy of any Notice to:

 

Jack S. Magids, Esq.

The Bogatin Law Firm, PLC

1661 International Place Drive, Suite 300

Memphis, Tennessee 38120-1431

Fax: (901) 767-2803

 

 

**** Common Units

 

**** CONFIDENTIAL TREATMENT

Fire Lake Partners, L.L.C.

3127 Commercial Drive
Anchorage, AK 99501

 

Fax:

Attn: Stephen M. Roberts

 

With a copy of any Notice to:

 

Jack S. Magids, Esq.

The Bogatin Law Firm, PLC

1661 International Place Drive, Suite 300

Memphis, Tennessee 38120-1431

Fax: (901) 767-2803

 

**** Profits Interest Units

 

SCHEDULE 4.1

 

Initial Capital Contributions

This Schedule 4.1 reflects the Initial Capital Contributions of each Member
following the transactions contemplated by Sections 2.2 and 2.3 of the
Reorganization Agreement.

 

 

Members

 

Agreed Fair Market Value

of Deemed Initial Contribution

General Communication, Inc.

 

$****

AKD Holdings, LLC

 

$****

Red River Wireless, LLC

 

$****

Pacificom Holdings II, LLC

 

$****

Fire Lake Partners, L.L.C.

 

$****

Total

 

$****

 

SCHEDULE 4.1

 

Initial Capital Contributions

This Schedule 4.1 reflects the Initial Capital Contributions of each Member
following the transactions contemplated by Sections 2.2, 2.3, 2.4 and 2.5 of the
Reorganization Agreement.

 

 

Members

 

Agreed Fair Market Value

of Deemed Initial Contribution

General Communication, Inc.

 

$****

AKD Holdings, LLC

 

$****

Fire Lake Partners, L.L.C.

 

$****

Total

 

$****

 

 

EXHIBIT A

 

Form of

 

Assignment of Units

 

The undersigned Transferor hereby transfers and assigns _______ Units in Alaska
Digitel, LLC, a Alaska limited liability company, to ________________________,
as Transferee. The Capital Account of the Transferor that is attributable to the
transferred Units will carry over to the Transferee. The Units transferred is
subject to all of the terms and conditions of that certain Second Amended and
Restated Operating Agreement of ______________, dated as of ______________, as
such Agreement may be amended (“Operating Agreement”). The Transferor shall
remain liable for all of its liabilities under the Operating Agreement.

 

Transferor:

 

By:_______________________________

 

Name:

 

Title:

Date:

EXHIBIT B

 

Form of

 

Transferee’s Agreement

 

As a Transferee of Units in Alaska Digitel, LLC, a Alaska limited liability
company governed by a Second Amended and Restated Operating Agreement dated as
of _______________, the undersigned agrees to be bound as a party to such
Agreement (which, as it may be amended, is hereby incorporated by reference).
The Transferee acknowledges and agrees that, unless admitted as a Member of the
limited liability company as provided in such Agreement, the Transferee will
have only the limited rights of an assignee as specified by law.

Transferee:

 

By:_______________________________

 

Name:

 

Title:

 

Date:

 

 

Address:

 

             

 

Taxpayer ID Number:

 

Telephone Number:

 

Fax Number:

EXHIBIT C

Form of Management Agreement

See attached.

EXHIBIT D

 

Examples of Adjustments to Common Units and Profits Interest Units Outstanding

See attached Schedule 2.3.3 to the Reorganization Agreement.

EXHIBIT E

 

Initial Budget

 

See attached.