EXHIBIT 2.1
CONTRIBUTION AGREEMENT
THIS CONTRIBUTION AGREEMENT, dated as of July 12, 2000, by and among iPCS,
Inc. (the "Company"), Geneseo Communications, Inc. ("Geneseo"), Cambridge
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Telcom, Inc. ("Cambridge"), Cass Communications Management, Inc. ("Cass"),
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Technology Group, LLC ("Technology"), Montrose Mutual PCS, Inc. ("Montrose"),
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▇▇▇▇▇▇▇ Enterprises, Inc. ("▇▇▇▇▇▇▇") and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ("▇▇▇▇▇" together
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with Geneseo, Cambridge, Cass, Technology, Montrose and ▇▇▇▇▇▇▇, each
individually referred to as a "Member" and collectively referred to as the
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"Members") and Illinois PCS, LLC, an Illinois limited liability company ("LLC").
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W I T N E S S E T H:
WHEREAS, the Company, the Members and LLC wish to effect on this date the
transfer and contribution by each Member to the capital of the Company all of
the membership interests of LLC set forth opposite the Member's name on Exhibit
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A to this Agreement, consisting of 100% of the outstanding limited liability
-
company membership interests in the LLC (the "Membership Interests"), upon which
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contribution LLC will become a wholly owned subsidiary of the Company; and
WHEREAS, in exchange for the transfer and contribution of the Membership
Interests, the Company will issue to each Member that number of shares of common
stock of the Company, par value $0.01, set forth opposite each Member's name on
Exhibit B to this Agreement (the "Common Stock"), upon which issuance the
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Company will be wholly owned directly by the Members;
WHEREAS, the Company, the Members and LLC now wish to enter into this
Agreement to provide therefor; and
WHEREAS, the Company and the Members intend that the contribution of the
Membership Interests shall be tax-free under Section 351 of the Internal Revenue
Code of 1986, as amended (the "Code").
NOW THEREFORE it is agreed that:
ARTICLE 1.
CONTRIBUTION AND ISSUANCE
The Members hereby sell, assign, transfer, convey and contribute to the
Company, and the Company hereby purchases, receives and accepts, all of the
Membership Interests. In consideration thereof, the Company hereby issues the
Common Stock to the Members.
ARTICLE 2.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Members that, as of the date of
this Agreement:
2.1 Organization and Qualification. The Company is a corporation duly
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organized and existing in good standing under the laws of the State of Delaware,
has all requisite corporate power and authority to execute and deliver this
Agreement, to issue the Common Stock, and to carry out the provisions of this
Agreement.
2.2 Authorization; Enforcement. This Agreement has been duly executed and
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delivered by the Company and constitutes a valid and binding obligation of the
Company enforceable against the Company in accordance with its terms, except (i)
as such enforceability may be limited by general principles of equity or
applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or
similar laws relating to, or affecting generally, the enforcement of creditors'
rights and remedies and (ii) as limited by laws relating to the availability of
specific performance, injunctive relief or other equitable remedies.
2.3 Issuance of Shares. The Common Stock being issued hereunder are duly
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authorized and, upon issuance in accordance with the terms of this Agreement,
will be validly issued, fully paid and non-assessable, and free from all taxes,
liens, claims and encumbrances and will not be subject to preemptive rights or
other similar rights of stockholders of the Company and will not impose personal
liability on the holders thereof.
2.4 Offering. Subject in part to the truth and accuracy of the Members'
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representations set forth in this Agreement, the issuance of the Common Stock as
contemplated in this Agreement is exempt from the registration requirements of
the Securities Act of 1933, as amended ("Securities Act"), and neither the
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Company nor any authorized agent acting on its behalf will take any action
hereafter that would cause the loss of such exemption.
2.5 Consents. There are no filings, consents or authorizations of any
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governmental authority required to be obtained by the Company in connection with
the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby.
2.6 No Brokers. The Company has taken no action which would give rise to
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any claim by any person for brokerage commissions, finder's fees or similar
payments relating to this Agreement or the transactions contemplated hereby.
2.7 Tax Representations. The Company has no present intention to issue
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any additional shares if such issuance of shares could cause the contributing
Members to lose control, as defined for purposes of Section 368(c) of the Code,
of the Company.
2
ARTICLE 3.
REPRESENTATIONS AND WARRANTIES OF THE MEMBERS
The Members represent and warrant, jointly and severally, to the Company as
follows:
3.1 Investment Purpose. The Members are acquiring the Common Stock for
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their own accounts for investment purposes only and not with a present view
towards the public sale or distribution thereof, except pursuant to sales that
are exempt from the registration requirements of the Securities Act and/or sales
registered under the Securities Act. The Members understand that they must bear
the economic risk of this investment indefinitely, unless the Common Stock are
registered pursuant to the Securities Act and any applicable state securities or
blue sky laws or an exemption from such registration is available.
Notwithstanding anything in this Section 3.1 to the contrary, by making the
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representations herein, the Members do not agree to hold the Common Stock for
any minimum or other specific term and reserve the right to dispose of the
Common Stock pursuant to sales that are exempt from the registration
requirements of the Securities Act and/or sales registered under the Securities
Act.
3.2 Accredited Investor Status. Each Member is an "Accredited Investor"
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as that term is defined in Rule 501(a) of Regulation D under the Securities Act.
3.3 Reliance on Exemptions. The Members understand that the shares of
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Common Stock are being issued to the Members in reliance upon specific
exemptions from the registration requirements of United States federal and state
securities laws and that the Company is relying upon the truth and accuracy of,
and the Members' compliance with, the representations, warranties, agreements,
acknowledgments and understandings set forth herein in order to determine the
availability of such exemptions and the eligibility of the Members to acquire
the Common Stock.
3.4 Information. The Members and their counsel, if any, have been
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furnished all materials relating to the business of the Company and materials
relating to the issuance of the Common Stock which have been specifically
requested by the Members or their counsel. The Members and their counsel, if
any, have been afforded the opportunity to ask questions of the Company and have
received what the Members believe to be satisfactory answers to any such
inquiries. Neither such inquiries nor any other due diligence investigation
conducted by the Members or their counsel or any of their representatives shall
modify, amend or affect the Members' right to rely on the Company's
representations and warranties contained in Section 2 above. The Members
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understand that their investment in the Common Stock involves a high degree of
risk.
3.5 Governmental Review. The Members understand that no United States
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federal or state agency or any other government or governmental agency has
passed upon or made any recommendation or endorsement of the Common Stock.
3
3.6 Authorization; Enforcement. This Agreement has been duly and validly
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authorized, executed and delivered by each Member and is a valid and binding
agreement of each Member enforceable in accordance with its terms, except (i) as
such enforceability may be limited by general principles of equity or applicable
bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws
relating to, or affecting generally, the enforcement of creditors' rights and
remedies and (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies.
3.7 No Consents. No filings, consents or authorizations of any
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governmental authority are required to be obtained by any Member in connection
with the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby.
3.8 Title. Each Member has good, valid, legal and beneficial title to the
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respective Membership Interests, free from all taxes, liens, claims or any other
encumbrance, and upon consummation of the transactions contemplated hereby each
Member shall transfer the respective Membership Interests to the Company free
from all taxes, liens, claims or any other encumbrance.
3.9 Tax Representation. No Member contributing the Membership Interests
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to the Company has any present intention or is subject to any obligation or
undertaking to dispose of any shares of the Company received.
ARTICLE 4.
REPRESENTATIONS AND WARRANTIES OF THE LLC
The LLC represents and warrants to the Members as follows:
4.1 Issuance of Member Interests. The Membership Interests are duly
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authorized, validly issued, fully paid and non-assessable and constitute all of
the issued and outstanding membership interests in LLC.
ARTICLE 5.
COVENANTS
5.1 Tax Covenants of the Company. The Company and all of its stockholders
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shall cooperate in good faith to ensure that the contribution of the Membership
Interests is and will remain tax free under Section 351 of the Code. The
Company reserves the right not to recognize any transfer of shares if such
transfer could, in the Company's determination, jeopardize the qualification of
such contribution as tax free under Section 351 of the Code.
4
5.2 Tax Covenants of the Members. No contributing Member shall take any
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actions that could reasonably be expected to jeopardize the qualification as
tax-free under Section 351 of the Code of the contribution of the Membership
Interests to the Company.
ARTICLE 6.
MISCELLANEOUS
6.1 Governing Law; Jurisdiction. This Agreement shall be governed by and
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construed in accordance with the laws of the State of Illinois applicable to
contracts made and to be performed in the State of Illinois.
6.2 Counterparts. This Agreement may be executed in two or more
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counterparts, all of which shall be considered one and the same agreement, and
shall become effective when counterparts have been signed by each party and
delivered to the other parties. This Agreement, once executed by a party, may
be delivered to the other parties hereto by facsimile transmission of a copy of
this Agreement bearing the signature of the party so delivering this Agreement.
In the event any signature is delivered by facsimile transmission, the party
using such means of delivery shall cause the manually executed signature page(s)
to be physically delivered to the other party within five (5) days of the
execution hereof.
6.3 Headings. The headings of this Agreement are for convenience of
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reference only and shall not form part of, or affect the interpretation of, this
Agreement.
6.4 Severability. If one or more provisions of this Agreement are held to
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be unenforceable under applicable law, such provision shall be excluded from
this Agreement and the balance of the Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.
6.5 Entire Agreement. This Agreement and the documents referred to herein
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constitute the entire agreement among the parties and no party shall be liable
or bound to any other party in any manner by any warranties, representations or
covenants except as specifically set forth herein.
6.6 Amendments and Waivers. No provision of this Agreement may be waived
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other than by an instrument in writing signed by the party to be charged with
enforcement and no provision of this Agreement may be amended other than by an
instrument in writing signed by the Company, the Members and LLC.
6.7 Notices. Each notice, demand, request, request for approval, consent,
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approval, disapproval, designation or other communication (each of the foregoing
being referred to herein as a notice) required or desired to be given or made
under this Agreement shall be in writing (except as otherwise provided in this
Agreement), and shall be effective and deemed to have been received (i) when
delivered in person, (ii) when sent by fax with receipt acknowledged,
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(iii) three (3) days after having been mailed by certified or registered United
States mail, postage prepaid, return receipt requested, or (iv) the next
business day after having been sent by a nationally recognized overnight mail or
courier service, receipt requested. Notices shall be addressed as follows: (a)
if to a Member, at the Member's address or fax number as such Member shall have
furnished to the Company in writing, or (b) if to the Company, at the address
set forth below:
If to the Company:
iPCS, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: President and Chief Executive Officer
with a copy to:
▇▇▇▇▇, ▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Each party shall provide notice to the other parties of any change in
address.
6.8 Successors and Assigns. This Agreement shall be binding upon and
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inure to the benefit of the parties and their successors and assigns. Except as
provided herein, neither the Company nor the Members shall assign this Agreement
or any rights or obligations hereunder. Notwithstanding the foregoing, a Member
may assign its rights hereunder to any of its "Affiliates," as that term is
defined under the Securities Exchange Act of 1934, as amended, without the
consent of the Company or to any other person or entity with the consent of the
Company with such consents not being unreasonably withheld.
6.9 Third Party Beneficiaries. This Agreement is intended for the benefit
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of the parties hereto and their respective permitted successors and assigns, and
is not for the benefit of, nor may any provision hereof be enforced by, any
other person.
6.1 Survival. The representations and warranties of the Company set forth
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in Section 2 shall survive the date hereof notwithstanding any due diligence
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investigation conducted by or on behalf of any Member. Moreover, none of the
representations and warranties made by the Company herein shall act as a waiver
of any rights or remedies a Member may have under applicable federal or state
securities laws. The Company agrees to indemnify and hold harmless each Member
and each of such Member's officers, directors, employees, partners, members,
agents and affiliates for loss or damage arising as a result of or related to
any breach or alleged
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breach by the Company of any of its representations or covenants set forth
herein, including advancement of expenses as they are incurred.
6.1 Further Assurances. Each party shall do and perform, or cause to be
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done and performed, all such further acts and things, and shall execute and
deliver all such other agreements, certificates, instruments and documents, as
the other party may reasonably request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
6.1 Attorneys' Fees. If the Company or any Member brings an action to
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enforce its rights under this Agreement, the prevailing party in the action
shall be entitled to recover its costs and expenses, including, without
limitation, reasonable attorneys' fees, incurred in connection with such action,
including any appeal of such action.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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[FIRST SIGNATURE PAGE TO CONTRIBUTION AGREEMENT]
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be duly
executed as of the date first above written.
iPCS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: President and Chief Executive Officer
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GENESEO COMMUNICATIONS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: President and Chief Executive Officer
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CAMBRIDGE TELCOM, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: General Manager
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CASS COMMUNICATIONS MANAGEMENT, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
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Title: Vice President and Chief Executive Officer
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TECHNOLOGY GROUP, LLC
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: General Manager
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[SECOND SIGNATURE PAGE TO CONTRIBUTION AGREEMENT]
MONTROSE MUTUAL PCS, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
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Title: General Manager
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▇▇▇▇▇▇▇ ENTERPRISES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: President
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ILLINOIS PCS, LLC
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
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Title: President and Chief Executive Officer
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EXHIBIT A
Tranche A Capital Contributions, contributed as of January 22, 1999
Capital
Member Contribution
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Geneseo Communications, Inc. $315,000
Cambridge Telcom, Inc. $270,000
Cass Communications Management, Inc. $ 90,000
Technology Group, LLC $ 90,000
Montrose Mutual PCS, Inc. $ 90,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 45,000
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TOTAL $900,000
Tranche B Capital Contributions, contributed as of February 26, 1999
Capital
Member Contribution
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Geneseo Communications, Inc. $315,000
Cambridge Telcom, Inc. $270,000
Cass Communications Management, Inc. $ 90,000
Technology Group, LLC $ 90,000
Montrose Mutual PCS, Inc. $ 90,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 45,000
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TOTAL $900,000
A-1
Tranche C Capital Contributions, contributed as of April 8, 1999
Capital
Member Contribution
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Geneseo Communications, Inc. $315,000
Cambridge Telcom, Inc. $270,000
Cass Communications Management, Inc. $ 90,000
Technology Group, LLC $ 90,000
Montrose Mutual PCS, Inc. $ 90,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 45,000
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TOTAL $900,000
Tranche D Capital Contributions, contributed as of May 18, 1999
Capital
Member Contribution
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Geneseo Communications, Inc. $ 700,000
Cambridge Telcom, Inc. $ 600,000
Cass Communications Management, Inc. $ 200,000
Technology Group, LLC $ 200,000
Montrose Mutual PCS, Inc. $ 200,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 100,000
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TOTAL $2,000,000
A-2
Tranche E Capital Contributions, contributed as of July 02, 1999
Capital
Member Contribution
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Geneseo Communications, Inc. $2,030,000
Cambridge Telcom, Inc. $1,740,000
Cass Communications Management, Inc. $ 580,000
Technology Group, LLC $ 580,000
Montrose Mutual PCS, Inc. $ 580,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 290,000
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TOTAL $5,800,000
Tranche F Capital Contributions, contributed as of December 01, 1999
Capital
Member Contribution
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Geneseo Communications, Inc. $1,050,000
Cambridge Telcom, Inc. $ 900,000
Cass Communications Management, Inc. $ 300,000
Technology Group, LLC $ 300,000
Montrose Mutual PCS, Inc. $ 300,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 150,000
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TOTAL $3,000,000
A-3
Tranche G Capital Contributions, contributed as of January 05, 2000
Capital
Member Contribution
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Geneseo Communications, Inc. $1,050,000
Cambridge Telcom, Inc. $ 900,000
Cass Communications Management, Inc. $ 300,000
Technology Group, LLC $ 300,000
Montrose Mutual PCS, Inc. $ 300,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 150,000
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TOTAL $3,000,000
Tranche H Capital Contributions, contributed as of March 01, 2000
Capital
Member Contribution
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Geneseo Communications, Inc. $1,225,000
Cambridge Telcom, Inc. $1,050,000
Cass Communications Management, Inc. $ 350,000
Technology Group, LLC $ 350,000
Montrose Mutual PCS, Inc. $ 350,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 175,000
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TOTAL $3,500,000
A-4
Tranche I Capital Contributions, contributed as of April 05, 2000
Capital
Member Contribution
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Geneseo Communications, Inc. $1,050,000
Cambridge Telcom, Inc. $ 900,000
Cass Communication Management, Inc. $ 300,000
Technology Group, LLC $ 300,000
Montrose Mutual PCS, Inc. $ 300,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 150,000
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TOTAL $3,000,000
Tranche J Capital Contributions, contributed as of April 26, 2000
Capital
Member Contribution
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Geneseo Communications, Inc. $2,450,000
Cambridge Telcom, Inc. $2,100,000
Cass Communication Management, Inc. $ 700,000
Technology Group, LLC $ 700,000
Montrose Mutual PCS, Inc. $ 700,000
▇▇▇▇▇▇▇ Enterprises, Inc. $ 350,000
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TOTAL $7,000,000
A-5
EXHIBIT B
Member Member Interest Shares
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Geneseo Communications, Inc. 34.48% 15,468,809
Cambridge Telcom, Inc. 29.55% 13,258,979
Cass Communications Management, Inc. 9.85% 4,419,660
Technology Group, LLC 9.85% 4,419,660
Montrose Mutual PCS, Inc. 9.85% 4,419,660
▇▇▇▇▇▇▇ Enterprises, Inc. 4.92% 2,209,830
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 1.50% 673,045
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TOTAL 100.00% 44,869,643
B-1
