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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
NEXTLINK COMMUNICATIONS, INC.
(Name of Issuer)
Class A Common Stock, $.02 par value
(Title of Class of Securities)
65333H707
(CUSIP Number)
C. James Judson, Esq. Bruce R. Lederman
General Counsel Latham & Watkins
Eagle River Investments, L.L.C. 633 West Fifth Street, Suite 400
2300 Carillon Point Los Angeles, California 90071
Kirkland, Washington 98033-7353 213-485-1234
425-828-8000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
October 10, 1997
(Date of Event which Requires Filing this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
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SCHEDULE 13D
CUSIP No. 65333H707
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Eagle River Investments, L.L.C.
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
a[ ]
b[ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS*
WC
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Washington
7. SOLE VOTING POWER
None
SHARES 8. SHARED VOTING POWER
BENEFICIALLY 18,871,786
OWNED BY
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON None
WITH
10. SHARED DISPOSITIVE POWER
18,871,786
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
18,871,786
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [X]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
50.8%
14. TYPE OF REPORTING PERSON*
0O
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SCHEDULE 13D
CUSIP No. 65333H707
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Eagle River, Inc.
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
a[ ]
b[ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS*
WC
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Washington
7. SOLE VOTING POWER
None
SHARES 8. SHARED VOTING POWER
BENEFICIALLY 18,878,406
OWNED BY
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON None
WITH
10. SHARED DISPOSITIVE POWER
18,878,406
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
18,878,406
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [X]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
50.8%
14. TYPE OF REPORTING PERSON*
CO
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SCHEDULE 13D
CUSIP No. 65333H707
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Craig O. McCaw
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
a[ ]
b[ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS*
PF
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7. SOLE VOTING POWER
266,466
SHARES 8. SHARED VOTING POWER
BENEFICIALLY 18,878,406
OWNED BY
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON None
WITH
10. SHARED DISPOSITIVE POWER
18,878,406
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
19,144,872
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [X]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
51.1%
14. TYPE OF REPORTING PERSON*
IN
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SCHEDULE 13D
CUSIP No. 65333H707
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Dennis Weibling
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
a[ ]
b[ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS*
OO
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7. SOLE VOTING POWER
1,500
SHARES 8. SHARED VOTING POWER
BENEFICIALLY 18,871,786
OWNED BY
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON 1,500
WITH
10. SHARED DISPOSITIVE POWER
18,871,786
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
18,873,286
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [X]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
50.1%
14. TYPE OF REPORTING PERSON*
IN
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SCHEDULE 13D
CUSIP No. 65333H707
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Wendy P. McCaw
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
a[ ]
b[ ]
3. SEC USE ONLY
4. SOURCE OF FUNDS*
OO
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) [ ]
6. CITIZENSHIP OR PLACE OF ORGANIZATION
United States
7. SOLE VOTING POWER
9,722,649
SHARES 8. SHARED VOTING POWER
BENEFICIALLY None
OWNED BY
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON 9,722,649
WITH
10. SHARED DISPOSITIVE POWER
None
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
9,722,649
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES* [X]
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
34.7%
14. TYPE OF REPORTING PERSON*
IN
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Explanatory Note:
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As a result of executing a NEXTLINK Shares Agreement (the
"Agreement") in connection with a portion of the settlement of a pending divorce
action between Mr. Craig O. McCaw and Mrs. Wendy P. McCaw effective as of
October 10, 1997, Eagle River Investments, L.L.C., a Washington limited
liability company that is controlled by Mr. McCaw ("Eagle River"), Eagle River,
Inc. ("ER Inc."), a Washington corporation, Mr. McCaw and Mr. Dennis Weibling,
each a member of Eagle River, may be deemed, for the purposes of Section 13(d)
of the Securities Exchange Act of 1934 (the "Exchange Act"), to have formed a
"group" with Mrs. McCaw. Eagle River, ER Inc., Mr. McCaw, Mr. Weibling and Mrs.
McCaw are sometimes referred to herein as the "Reporting Persons."
Item 1. Security and Issuer.
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This Statement on Schedule 13D relates to shares of Common
Stock, $.02 par value per share (the "Class A Common Stock") of NEXTLINK
Communications, Inc., a Washington corporation (the "Issuer") that are issuable
upon conversion of shares of Class B Common Stock, par value $.02 per share on a
one-for-one basis (the "Class B Common Stock"). The address of the principal
executive offices of the Issuer is 155 108th Avenue N.E., 8th Floor, Bellevue,
Washington 98004.
Item 2. Identity and Background.
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(a)-(c) and (f). This Statement is being filed by the
Reporting Persons. Eagle River is organized under the laws of the State of
Washington, and its principal business address is 2300 Carillon Point, Kirkland,
Washington 98033-7353. Eagle River is a limited liability company that is
managed by its members. Eagle River is filing this Statement as the beneficial
owner of 18,871,786 shares of Class B Common Stock. Eagle River is engaged in
the business of holding investments in certain telecommunications ventures,
including the Issuer.
ER Inc. is organized under the laws of the State of
Washington, and its principal business address is 2300 Carillon Point, Kirkland,
Washington 98033-7353. Eagle River is filing this Statement as a member of Eagle
River. ER Inc. is engaged in the business of the purchase, sale and holding of
securities and other investment instruments.
Mr. McCaw, a United States citizen, is filing this Statement
in his capacity as a member of Eagle River. Mr. McCaw's business address is 2300
Carillon Point, Kirkland, Washington 98033-7353. Mr. McCaw is engaged in the
business of
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holding investments in certain telecommunications ventures, including the
Issuer. Mr. McCaw is also a director of the Issuer.
Mr. Weibling, a United States citizen, is filing this
Statement in his capacity as a member of Eagle River. Mr. Weibling disclaims
beneficial ownership in all securities held by Eagle River, except to the extent
of his pecuniary interest therein. Mr. Weibling's business address is 2300
Carillon Point, Kirkland, Washington 98033-7353. Mr. Weibling is in the business
of serving as President of ER Inc. and a director of the Issuer.
Mrs. McCaw, a United States citizen, is filing this Statement
as the beneficial owner of 9,722,649 shares of Class B Common Stock. Mrs.
McCaw's business address is c/o Lasher Holzappel Sperry & Ebberson, PLLC, 2600
Two Union Square, 601 Union Street, Seattle, Washington 98101-4000, Attention
Earl P. Lasher, III, Esq. Mrs. McCaw is a private investor.
The names, business addresses, principal occupations and
citizenship of the executive officers of Eagle River are set forth in Annex A
hereto and are incorporated herein by reference.
The names, business addresses, principal occupations and
citizenship of the directors and executive officers of ER Inc. are set forth in
Annex B hereto and are incorporated herein by reference.
(d) and (e). During the last five years, the Reporting Persons
and, to the best knowledge of the Reporting Persons, the executive officers of
Eagle River and ER Inc. have not (i) been convicted in a criminal proceeding
(excluding traffic violations and similar misdemeanors) or (ii) been a party to
a civil proceeding of a judicial or administrative body of competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or prohibiting or
mandating activities subject to, Federal or state securities laws or finding any
violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration.
- ------- --------------------------------------------------
Eagle River purchased the securities reported in Item 5 prior
to the registration of the Class A Common Stock under Section 12(g) of the
Exchange Act with approximately $55.0 million of working capital contributed by
Mr. McCaw.
Mrs. McCaw obtained beneficial ownership of the securities
reported in Item 5 in connection with the settlement of a pending divorce
proceeding between Mr. McCaw and Mrs. McCaw.
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Item 4. Purpose of Transaction.
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Eagle River acquired the securities reported in Item 5 in
connection with the formation of the Issuer and in connection with additional
equity contributions prior to April 1997.
In connection with the settlement of a pending divorce action
between Mr. McCaw and Mrs. McCaw, Mr. McCaw has agreed, within 60 days, to
transfer beneficial and, under certain circumstances, legal ownership to Mrs.
McCaw of 9,722,649 shares of Class B Common Stock. The Class B Common Stock is
convertible, at any time and on a one-for-one basis, for shares of Class A
Common Stock, which is registered pursuant to Section 12(g) of the Exchange Act.
In connection with the transfer, effective as of October 10,
1997, Mr. McCaw and Mrs. McCaw entered into the Agreement. The Agreement
provides that for so long as Mrs. McCaw owns shares of Class B Common Stock, Mr.
McCaw will have the right, at his election, to obtain a proxy from Mrs. McCaw
for such of her shares of Class B Common Stock or Class A Common Stock, as the
case may be, as are necessary for Mr. McCaw to have 51% of the voting power of
the Issuer, but this right shall expire after Mr. McCaw has sold 50% or more of
his existing shares of Class B Common Stock. In addition, Mr. McCaw has agreed
to vote in favor of Mrs. McCaw's designate to the Board of Directors of the
Issuer, should Mrs. McCaw elect to exercise her right to do so, but this
obligation shall expire after Mrs. McCaw has sold 50% or more of her existing
Class B Common Stock or when their combined voting power is insufficient to
elect three directors.
The Reporting Persons may from time to time seek to increase,
reduce or dispose of their investment in the Issuer in the open market, in
privately negotiated transactions, or otherwise. The determination to effect any
such transactions will depend on, among other things, the market price,
availability of funds, borrowing costs, market conditions, tax considerations,
developments affecting the Issuer and the Reporting Persons, other opportunities
available to the Reporting Persons and other considerations.
As a result of the beneficial ownership of 54.8% of the Class
B Common Stock, Eagle River controls the Issuer. As a result, Mr. McCaw, who is
the controlling member of Eagle River, will have the ability to control the
direction and future operations of the Issuer.
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From time to time, one or more of the Reporting Persons may
hold discussions with third parties or with management of the Issuer in which
the Reporting Person may suggest or take a position with respect to potential
changes in the operations, management or capital structure of the Issuer as a
means of enhancing shareholder value. Such suggestions or positions may relate
to one or more of the transactions specified in clauses (a) through (j) of Item
4 of the Schedule 13D, including, without limitation, such matters as disposing
of or selling all or a portion of the Issuer or acquiring another company or
business, changing operating or marketing strategies, adopting or not adopting
certain types of anti-takeover measures and restructuring the Issuer's
capitalization or dividend policy.
Except as set forth above, the Reporting Persons do not have
any present plans or proposals that relate to or would result in any of the
actions required to be described in Item 4 of Schedule 13D.
Each of the Reporting Persons may, at any time, review or
reconsider its position with respect to the Issuer and formulate plans or
proposals with respect to any of such matters, but has no present intention of
doing so.
Item 5. Interest in Securities of Issuer.
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(a) and (b). (i) Eagle River may be deemed to have voting and
investment power with respect to 28,594,435 Class B Common Stock, which are
convertible into 28,594,435 Class A Common Stock at any time. Such shares of
Class B Common Stock represent 83.1% of the Class B Common Stock and 61.0% of
the Class A Common Stock determined in accordance with Rule 13d-3(d)(1)(i) under
the Exchange Act. Eagle River shares voting and investment power with ER Inc.
and Mr. McCaw, and may be deemed to share voting power with Mrs. McCaw. Eagle
River disclaims beneficial ownership in 9,722,649 shares of Class B Common Stock
beneficially owned by Mrs. McCaw.
(ii) ER Inc. may be deemed to have voting and investment power
with respect to 28,594,435 shares of Class B Common Stock, which are convertible
into 28,594,435 shares of Class A Common Stock at any time and an additional
6,620 shares of Class A Common Stock pursuant to options to acquire such Class A
Common Stock that are exercisable within 60 days. Such shares of Class B Common
Stock represent 83.1% of the Class B Common Stock and 61.0% of the Class A
Common Stock determined in accordance with Rule 13d-3(d)(1)(i) under the
Exchange Act. ER Inc. shares voting and investment power with Eagle River and
Mr. McCaw with respect to the 28,594,435 shares of Class A Common Stock and may
be deemed to share voting power with Mrs. McCaw. ER Inc. disclaims
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beneficial ownership in 9,722,649 shares of Class B Common Stock beneficially
owned by Mrs. McCaw.
(iii) Mr. McCaw may be deemed to have voting and investment
power with respect to 28,860,901 shares of Class B Common Stock, which are
convertible into 28,860,901 shares of Class A Common Stock at any time and an
additional 6,620 shares of Class A Common Stock pursuant to options to acquire
such Class A Common Stock that are exercisable within 60 days. Such shares of
Class B Common Stock represent 83.9% of the Class B Common Stock and 61.2% of
the Class A Common Stock determined in accordance with Rule 13d-3(d)(1)(i) under
the Exchange Act. Mr. McCaw shares voting and investment power with Eagle River
and ER Inc. with respect to 28,594,435 shares of Class A Common Stock, and may
be deemed to share voting power with Mrs. McCaw. Mr. McCaw disclaims beneficial
ownership in 9,722,649 shares of Class B Common Stock beneficially owned by Mrs.
McCaw.
(iv) Mr. Weibling may be deemed to have voting and investment
power with respect to 28,594,435 shares of Class B Common Stock, which are
convertible into 28,594,435 shares of Class A Common Stock at any time as a
result of his membership in Eagle River, and an additional 1,500 shares of Class
A Common Stock that are held in trust for Mr. Weibling's minor children. Such
shares of Class B Common Stock represent 83.1% of the Class B Common Stock and
61.0% of the Class A Common Stock determined in accordance with Rule
13d-3(d)(1)(i) under the Exchange Act. Mr. Weibling may be deemed to share
voting and investment power with Eagle River, ER Inc. and Mr. McCaw, and voting
power with Mrs. McCaw. Mr. Weibling disclaims beneficial ownership in all
securities held by Eagle River, except to the extent of his pecuniary interest
therein. Mr. Weibling also disclaims beneficial ownership in 9,722,649 shares of
Class B Common Stock beneficially owned by Mrs. McCaw.
(v) Mrs. McCaw may be deemed to have voting and investment
power with respect to 28,860,901 shares of Class B Common Stock, which are
convertible into 28,860,901 shares of Class A Common Stock at any time, 1,500
shares of Class A Common Stock and an additional 6,620 shares of Class A Common
Stock pursuant to options to acquire such Class A Common Stock that are
exercisable within 60 days. Such shares of Class B Common Stock represent 83.9%
of the Class B Common Stock and 61.2% of the Class A Common Stock determined in
accordance with Rule 13d-3(d)(1)(i) under the Exchange Act. Mrs. McCaw may be
deemed to share voting power and investment power with Eagle River, ER Inc., Mr.
McCaw and Mr. Weibling. Mrs. McCaw disclaims beneficial ownership of an
aggregate of 19,138,252 shares of Class B Common Stock and 8,120 shares of Class
A Common Stock beneficially owned by Mr. McCaw, Eagle River, ER Inc. and Mr.
Weibling.
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All percentages contained in this Schedule 13D have been
calculated based upon 34,406,523 shares of Class B Common Stock outstanding and
18,290,429 shares of Class A Common Stock outstanding, each as of October 1,
1997, the closing date of the Issuer's initial public offering.
(c) There have been no transactions in shares of Class A
Common Stock by the Reporting Persons or, to the best knowledge of the Reporting
Persons, by any of Eagle River's or ER Inc.'s executive officers and executive
officers and directors, respectfully, during the past 60 days, except as
follows. On October 1, 1997, Eagle River sold 3,200,000 shares of Common Stock
in an underwritten public offering. Such offering was effected on the Nasdaq
National Market. Eagle River received an aggregate of $51,000,000 in connection
with such public offering with a price per share of $15.9375, net of
underwriting discount and commission. (ii) Effective October 10, 1997, Mr. McCaw
agreed to use his best efforts to transfer beneficial and, under certain
circumstances, legal ownership to Mrs. McCaw by October 31, 1997 of 9,722,649
shares of Class B Common Stock in connection with the settlement of a pending
divorce proceeding. (iii) On October 1, 1997, Mr. Weibling purchased 1,500
shares of Class A Common Stock at a purchase price of $17.00 directly from the
underwriters in the initial public offering for the Issuer. Such shares are held
in trust for Mr. Weibling's minor children. (iv) On October 1, 1997, Mr. Hoglund
purchased 3,000 shares of Class A Common Stock at a purchase price of $17.00
directly from the underwriters in the initial public offering for the Issuer.
Such shares are held in trust for Mr. Hoglund's minor children. In addition, on
October 1, 1997, Mr. Hoglund purchased 5,000 shares of Class A Common Stock at a
purchase price of $17.00 directly from the underwriters in the initial public
offering for the Issuer.
(d) To the knowledge of the Reporting Persons, no person other
than each respective record owner referred to herein of shares of Class A Common
Stock or Class B Common Stock is known to have the right to receive or the power
to direct the receipt of dividends from or the proceeds of sale of shares of
Class A Common Stock and Class B Common Stock, except that the respective
members and shareholders, as relevant, of Eagle River and ER Inc. have the right
to participate in the receipt of dividends from or proceeds of the sale of, the
shares of Class A Common Stock and Class B Common Stock held for their
respective accounts.
(e) Not applicable.
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Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
- ------- to Securities of the Issuer.
---------------------------------------------------------------------
Other than the Agreement described in response to Item 4
(which response is incorporated herein by reference) and the transactions
contemplated thereby, there are no contracts, arrangements, understandings or
relationships between the Reporting Persons and any other person, or, to the
best knowledge of the Reporting Persons, among any of the Eagle River's
executive officers or ER Inc.'s executive officers and directors or between any
of Eagle River's executive officers or ER Inc.'s executive officers and
directors and any other person, with respect to the Class A Common Stock or
Class B Common Stock.
Item 7. Material to Be Filed as Exhibits.
- ------- ---------------------------------
Exhibit 99.1 NEXTLINK Shares Agreement, dated effective as of October 10,
1997, between Craig O. McCaw and Wendy P. McCaw
Exhibit 99.2 Joint Filing Agreement among the Reporting Persons dated as of
October 20, 1997
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true,
complete and correct.
Dated: October 20, 1997
EAGLE RIVER INVESTMENTS, L.L.C.
By: /s/ C. James Judson
---------------------------
C. James Judson
Vice President
EAGLE RIVER, INC.
By: /s/ C. James Judson
-----------------------------
C. James Judson
Vice President
/s/ Craig O. McCaw
_________________________________________
Craig O. McCaw
/s/ Dennis Weibling
_________________________________________
Dennis Weibling
/s/ Wendy P. McCaw
_________________________________________
Wendy P. McCaw
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<PAGE>
Annex A
Executive Officers of Eagle River Investments L.L.C.
Principal Occupation
Business at Eagle River
Name Address Investments, L.L.C. Citizenship
- ---- -------- -------------------- -----------
Craig O. 2300 Carillon
McCaw Point Chairman United States
Kirkland, Washington
98033-7353
Dennis 2300 Carillon President and
Weibling Point Treasurer United States
Kirkland, Washington
98033-7353
C. James 2300 Carillon
Judson Point Vice President, General United States
Kirkland, Washington Secretary
98033-7353
William A. 2300 Carillon
Hoglun Point Vice President and United States
Kirkland, Washington Chief Financial
98033-7353 Officer
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Annex B
Executive Officers of Eagle River, Inc.
Name Business Principal Occupation
Address at Eagle River, Citizenship
Inc.
Craig O. 2300 Carillon
McCaw Point Chairman United States
Kirkland, Washington
98033-7353
Dennis 2300 Carillon President and
Weibling Point Treasurer United States
Kirkland, Washington
98033-7353
C. James 2300 Carillon
Judson Point Vice President, General United States
Secretary
Kirkland, Washington
98033-7353
William A. 2300 Carillon
Hoglun Point Vice President and United States
Chief Financial
Officer
Kirkland, Washington
98033-7353
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Exhibit 99.1
NEXTLINK SHARES AGREEMENT
The Parties have, as an integral part of their marital settlement,
reached a settlement of all issues and wish to set forth the essential terms
having to do with shares of NextLink Communications, Inc. owned by the Parties
(the "Existing Stock") in this Agreement, which will be binding and enforceable
between them. This Agreement shall be effective as of October 10, 1997.
1. Property Division. The Parties shall allocate to Wendy P.
McCaw ("Wife") 9,722,649 shares of Class B common stock of
NextLink.
2. Allocation. The NextLink shares allocated to Wife will be
distributed free of all liens and encumbrances and will be
vested in Wife's name. The NextLink shares shall be freely
transferable by Wife, subject to compliance with the
applicable securities and other laws and SEC regulations, and,
to the extent applicable to Wife, all Company-established
policies and rules regarding insider trading and non-public
information. Except for the shareholder rights and minority
protections in Section 5 through 9 herein which shall
supersede the following provisions, Wife's ownership of shares
in NextLink shall be subject to terms and restrictions
contained in the Articles of Incorporation of NextLink, its
Bylaws, its Stock Option Plan dated January 15, 1997, and the
Registration Rights Agreement dated January 15, 1997 among
NextLink and certain holders of its Class B common stock. Each
Party will use best efforts to minimize the effect of such
restrictions.
3. Closing. The Parties shall use best efforts to transfer stock
of NextLink to Wife by October 31, 1997, subject to the
provisions of Section 4 below.
4. Wife's Option. Wife shall have the option of retaining part or
all of her shares of NextLink in Eagle River Investments, LLC,
("Eagle River") on the following terms and conditions. The LLC
Agreement of Eagle River would be amended to continue her as a
member and to accurately reflect her separate interest in
NextLink. Upon 30 days notice and, notwithstanding any
restrictions to the contrary in the limited liability company
agreement of Eagle River, Wife would be entitled to cause
Eagle River to distribute Wife's NextLink stock to her. Any
such distribution to her would be free and clear of all liens
and liabilities and Craig O. McCaw ("Husband") will use best
efforts to assure that, after any such distribution, Wife will
have those existing rights that are applicable to NextLink in
its present status within Eagle River. Alternatively, Wife
shall have the right to require Eagle River to sell her
proportionate share of NextLink stock at her sole cost, effort
and expense, and to receive the proceeds therefrom as a
distribution, all subject to applicable securities and other
laws and SEC regulations, and, to the extent applicable to
Wife, all Company-established policies and rules regarding
insider trading and non-public information. Wife will bear the
tax consequences of any such sale. Wife will be able freely to
pledge or mortgage her interest in Eagle River, provided that
any such pledgee or mortgage holder will agree that, in the
event of any foreclosure, the only requirement of Eagle River
is that it distribute to such pledgee or mortgage holder
Wife's NextLink
<PAGE>
stock and its only rights with respect to Eagle River will be
to obtain such NextLink stock. The Parties agree that the tax
issues relating to withdrawal of the Existing Stock will be
handled in the same manner as the Parties utilize with respect
to other securities being dealt with as a result of their
marital settlement. Prior to distribution, Wife would have
approval rights with respect to any changes in the Eagle River
governing documents that would adversely effect her NextLink
stock. If a majority in interest of the Eagle River members
approves changes in the Eagle River governing documents, and
Wife disapproves of such changes, and the changes do not
discriminate against her interest and apply uniformly to all
other Eagle River members, then Eagle River may distribute
Wife's NextLink stock to her if she does not withdraw her
disapproval. Wife's rights under this paragraph are subject to
applicable law, including securities laws, and to NextLink
documents listed in paragraph 2 hereof.
5. Tag Along. Wife will have tag along rights with respect to
NextLink in connection with any sale or transfer or series of
related sales by Husband or an entity controlled by him of
control of NextLink or of 50% or more of the interest in
NextLink owned by him or any of his controlled entities.
6. Registration Rights. At Wife's option, Husband shall cause
Wife to become a party to the Registration Rights Agreement
dated as of January 15, 1997 between NextLink and a number of
other signatories, including Eagle River, or separately to be
granted similar rights. The right to a demand registration may
be exercised only once by Wife, and all demand registration
rights may only be exercised after the announcement of first
quarter 1998 financial results of NextLink, or June 30, 1998,
whichever is sooner. In addition, Wife will receive piggyback
registration rights as to any registration in which Husband or
any of his affiliates has a right to register any NextLink
shares.
7. Information Rights. Wife shall have, at her option, the right
to receive information distributed to NextLink board members
in their capacities as directors.
8. Voting Rights. Wife will retain her existing voting rights
with respect to her shares of NextLink Class B common stock
(10:1) upon the distribution from Eagle River to her, or to a
trust or other entity of which she is the beneficial owner.
For so long as Wife owns such shares, Husband will have the
right, at his election, to obtain a proxy from her for such of
her shares as are necessary for him to have 51% of the voting
power of NextLink, but this right shall expire after he has
sold 50% or more of his existing NextLink stock. Wife will
have the right to designate one NextLink director and Husband
and any entity controlled by him owning NextLink shares will
vote their shares to support her designee, but this right
shall expire after she has sold 50% or more of her existing
NextLink stock or when their combined voting power is
insufficient to elect three directors.
9. Drag Along Rights. Wife agrees to grant to Husband drag along
rights in Husband's favor so long as the price the Parties are
to receive for NextLink shares is equal to or greater than the
stock's current market trading value as of the time the drag
along rights are exercised.
10. Dispute Resolution. The Parties agree to resolve any disputes
under this Agreement in the same manner as they utilize to
resolve other disputes arising out of their marital
settlement.
2
<PAGE>
11. Amendments, etc. This Agreement supersedes any and all other
prior understandings or agreements concerning the ownership of
the Existing Stock. The Parties may in connection with other
matters arising out of the settlement of their marital
property, amend, modify of supplement the terms and provisions
of this Agreement, but such amendments, modifications or
supplements shall not be effective unless set forth in a
writing executed by both Parties dated subsequent hereto.
12. Other. This Agreement a) may be specifically enforced, and the
Parties agree that in cases where specific enforcement is
feasible, it will not be urged that a remedy at law is
adequate or preferable; b) is governed by Washington law; c)
shall be kept confidential except as reasonable determined by
each party in the ordinary course of business; d) may be
executed in multiple counterparts and by FAX; e) shall remain
in full force and effect in case of the death of either or
both Parties and may be enforced by or against the estate of
either. Each party warrants that he or she has been fully
advised by counsel with respect to this Agreement.
/s/ Craig O. McCaw /s/ Wendy P. McCaw
Craig O. McCaw Wendy P. McCaw
3
<PAGE>
EXHIBIT 2
JOINT FILING AGREEMENT
The undersigned hereby agree that the statement on Schedule
13D dated October 20, 1996, with respect to the Class A Common Stock of NEXTLINK
Communications, Inc. is, and any amendments thereto signed by each of the
undersigned shall be, filed on behalf of each of us pursuant to and in
accordance with the provisions of Rule 13d-1(f) under the Securities Exchange
Act of 1934.
This Agreement may be executed in counterparts, each of which
shall for all purposes be deemed to be an original and all of which shall
constitute one and the same instrument.
Dated: October 20, 1997
EAGLE RIVER INVESTMENTS, L.L.C.
By: /s/ C. James Judson
---------------------------
C. James Judson
Vice President
EAGLE RIVER, INC.
By: /s/ C. James Judson
-----------------------------
C. James Judson
Vice President
/s/ Craig O. McCaw
_________________________________________
Craig O. McCaw
/s/ Dennis Weibling
_________________________________________
Dennis Weibling
/s/ Wendy P. McCaw
_________________________________________
Wendy P. McCaw
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