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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13D
Under the Securities Exchange Act of 1934
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(Amendment No. 3 )
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CAI Wireless Systems, Inc.
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(Name of Issuer)
Common Stock 12476P 10 4
- ----------------------------------- -----------------------------------
(Title of class of securities) (CUSIP number)
BANX Partnership
3900 Washington Street
Wilmington, Delaware 19802
with copies to:
P. Alan Bulliner, Esq. Morrison DeS. Webb, Esq.
Vice President-Corporate Secretary Executive Vice President,
and Counsel General Counsel and Secretary
Bell Atlantic Corporation NYNEX Corporation
1717 Arch Street 1095 Avenue of the Americas
Philadelphia, PA 19103 New York, NY 10036
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(Name, address and telephone number of person authorized to receive
notices and communications)
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(Date of event which requires filing of 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 [_].
Check the following box if a fee is being paid with the statement [_].
(A fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent
of the class of securities described in Item 1; and (2) has filed no
amendment subsequent thereto reporting beneficial ownership of five
percent or less of such class.) (See Rule 13d-7.)
Note: When filing this statement in paper form, six copies of this
statement, including exhibits, should be filed with the Commission. See
Rule 13d-1(a) for other parties to whom copies are to be sent.
(Continued on following page(s))
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CUSIP No. 12476P 10 4 13D
1 NAME OF REPORTING PERSON: BANX Partnership
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON:
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
3 SEC USE ONLY
4 SOURCE OF FUNDS: AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [_]
REQUIRED PURSUANT TO ITEM 2(d) OR 2(e):
6 CITIZENSHIP OR PLACE OF Delaware
ORGANIZATION:
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
BENEFICIALLY 8 SHARED VOTING POWER: 19,862,150
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
PERSON WITH 10 SHARED DISPOSITIVE 19,862,150
POWER:
11 AGGREGATE AMOUNT BENEFICIALLY 19,862,150
OWNED BY REPORTING PERSON:
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [_]
EXCLUDES CERTAIN SHARES:
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 34.6%
14 TYPE OF REPORTING PERSON: PN
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CUSIP No. 12476P 10 4 13D
1 NAME OF REPORTING PERSON: MMDS Holdings II, Inc.
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON:
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
3 SEC USE ONLY
4 SOURCE OF FUNDS: AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [_]
REQUIRED PURSUANT TO ITEM 2(d) OR 2(e):
6 CITIZENSHIP OR PLACE OF Delaware
ORGANIZATION:
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
BENEFICIALLY 8 SHARED VOTING POWER: 36,501,085
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
PERSON WITH 10 SHARED DISPOSITIVE 36,501,085
POWER:
11 AGGREGATE AMOUNT BENEFICIALLY 36,501,085
OWNED BY REPORTING PERSON:
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [_]
EXCLUDES CERTAIN SHARES:
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 49.2%
14 TYPE OF REPORTING PERSON: CO
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CUSIP No. 12476P 10 4 13D
1 NAME OF REPORTING PERSON: Bell Atlantic Corporation
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON:
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
3 SEC USE ONLY
4 SOURCE OF FUNDS: AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [_]
REQUIRED PURSUANT TO ITEM 2(d) OR 2(e):
6 CITIZENSHIP OR PLACE OF Delaware
ORGANIZATION:
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
BENEFICIALLY 8 SHARED VOTING POWER: 36,626,085
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
PERSON WITH 10 SHARED DISPOSITIVE 36,626,085
POWER:
11 AGGREGATE AMOUNT BENEFICIALLY 36,626,085
OWNED BY REPORTING PERSON:
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [_]
EXCLUDES CERTAIN SHARES:
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 49.4%
14 TYPE OF REPORTING PERSON: CO
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CUSIP No. 12476P 10 4 13D
1 NAME OF REPORTING PERSON: NYNEX MMDS Holding Company
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON:
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
3 SEC USE ONLY
4 SOURCE OF FUNDS: AF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [_]
REQUIRED PURSUANT TO ITEM 2(d) OR 2(e):
6 CITIZENSHIP OR PLACE OF Delaware
ORGANIZATION:
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
BENEFICIALLY 8 SHARED VOTING POWER: 36,626,085
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
PERSON WITH 10 SHARED DISPOSITIVE 36,626,085
POWER:
11 AGGREGATE AMOUNT BENEFICIALLY 36,626,085
OWNED BY REPORTING PERSON:
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [_]
EXCLUDES CERTAIN SHARES:
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 49.4%
14 TYPE OF REPORTING PERSON: CO
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CUSIP No. 12476P 10 4 13D
1 NAME OF REPORTING PERSON: NYNEX Corporation
S.S. OR I.R.S. IDENTIFICATION NO.
OF ABOVE PERSON:
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP: (a) [x]
(b) [_]
3 SEC USE ONLY
4 SOURCE OF FUNDS: WC
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS [_]
REQUIRED PURSUANT TO ITEM 2(d) OR 2(e):
6 CITIZENSHIP OR PLACE OF Delaware
ORGANIZATION:
NUMBER OF 7 SOLE VOTING POWER: 0
SHARES
BENEFICIALLY 8 SHARED VOTING POWER: 36,626,085
OWNED BY
EACH 9 SOLE DISPOSITIVE POWER: 0
REPORTING
PERSON WITH 10 SHARED DISPOSITIVE 36,626,085
POWER:
11 AGGREGATE AMOUNT BENEFICIALLY 36,626,085
OWNED BY REPORTING PERSON:
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) [_]
EXCLUDES CERTAIN SHARES:
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11): 49.4%
14 TYPE OF REPORTING PERSON: CO
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ITEM 1 SECURITY AND ISSUER.
This Statement constitutes Amendment No. 3 to the Statement
on Schedule 13D (the "Schedule 13D") previously filed with the
Securities and Exchange Commission by BANX Partnership, a Delaware
general partnership ("BANX"); its general partners, MMDS Holdings II,
Inc., a Delaware corporation ("MMDS Holdings"), and NYNEX MMDS Holding
Company, a Delaware corporation ("NYNEX MMDS"); Bell Atlantic
Corporation, a Delaware corporation and the indirect parent of MMDS
Holdings ("BAC"); and NYNEX Corporation, a Delaware corporation and
the direct parent corporation of NYNEX MMDS ("NYNEX"; and, together
with BANX, MMDS Holdings, NYNEX MMDS and BAC, the "Reporting
Persons"), with respect to the common stock, no par value (the "Common
Stock"), of CAI Wireless Systems, Inc., a Connecticut corporation
("CAI") located at 18 Corporate Woods Blvd., Albany, NY 12211. Unless
otherwise indicated, all capitalized terms used herein have the
respective meanings ascribed thereto in the Schedule 13D.
ITEM 2. IDENTITY AND BACKGROUND.
Schedules I, II, III and IV annexed to the Schedule 13D are
hereby amended in their entirety to read in full as set forth on
Schedules I, II, III and IV annexed hereto and incorporated herein by
reference.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
At the Stage II Closing under the Purchase Agreement, which
occurred on September 29, 1995, BANX purchased from the Corporation
for aggregate cash consideration of $70 million, (i) 7,000 shares of
14% Senior Preferred Stock of the Corporation, par value $10,000 per
share (the "Senior Preferred Stock"), and (ii) a warrant (the "Stage
II Warrant") to purchase convertible preferred stock, no par value, of
the Corporation (the "Voting Preferred Stock"). In addition, BANX
transferred one-half of its interest in (i) the Term Notes (and all
accrued interest thereon) and (ii) the Senior Preferred Stock, to each
of MMDS Holdings and NYNEX MMDS, and upon surrender by BANX to the
Corporation, the Corporation cancelled the Term Notes issued at the
Stage I Closing and the certificates representing the Senior Preferred
Stock registered in the name of BANX and issued Term Notes in the
principal amount of $15,000,000 and share certificates representing
3,500 shares of Senior Preferred Stock to each of MMDS Holdings and
NYNEX MMDS.
At the Stage II Closing, the Term Notes pursuant to their
terms became unsecured obligations of the Corporation, subordinated to
certain senior indebtedness of the Corporation, bearing interest at
14% per annum, and also became convertible into the Senior Preferred
Stock, at an initial conversion price of $10,000 per share, subject to
adjustment.
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The Senior Preferred Stock is convertible, at the option of
the holder at any time on or after the date of issuance of such shares
and prior to the fifth anniversary of the original issue date, into
the number of Voting Preferred Shares as is determined by dividing
$10,000 by the Tier 1 Conversion Price (as defined in the terms of the
Senior Preferred Stock). Dividends on the Senior Preferred Stock are
cumulative from the Stage II Closing and are payable quarterly at an
annual rate of 14% when and as declared by the Board of Directors of
CAI out of any funds legally available therefor.
The Stage II Warrant permits the holder, for a period of six
years, to acquire shares of Voting Preferred Stock at four different
exercise prices. The exercise prices of the Stage II Warrant will be
determined in accordance with certain formulas, set forth in the Stage
II Warrant, based on the number of Fully-Diluted Common Shares (as
defined in the Stage II Warrant) immediately after consummation of the
Stage II Closing, subject to adjustment, including antidilution
adjustment. Each share of Voting Preferred Stock initially is
convertible, at the option of the holder, into 100 shares of Common
Stock. The holders of Voting Preferred Stock are entitled to certain
voting rights with respect to the election of directors of the
Corporation and other matters. The terms of the Voting Preferred
Stock are set forth in Attachment 2.3 to the Amendment Agreement dated
as of September 28, 1995 among BANX, the Corporation and its
subsidiaries party thereto, which amends certain provisions of the
Purchase Agreement and is set forth as Exhibit 1 to Amendment No. 2
to the Schedule 13D.
The conversion of the Senior Preferred Stock (including the
shares issuable upon conversion of the Term Notes into Senior
Preferred Stock) and the exercise of the Stage I and Stage II Warrant
gives the BANX Affiliates the right to acquire, for an aggregate
amount of approximately $302 million (including consideration
originally paid for the Term Notes, the Senior Preferred Stock and
such Warrants), shares of the Voting Preferred Stock which would be
convertible into approximately 45% of the Fully-Diluted Common Shares
and, in the event of the issuance after the Stage II Closing of any
additional of common stock, no par value of the Corporation ("Common
Shares"), the right to acquire additional shares of Voting Preferred
Stock at the same per share exercise prices, so that the BANX
Affiliates will maintain the right to acquire 45% of the Fully-Diluted
Common Shares from time to time.
If the conversion rights under the Term Notes, the Senior
Preferred Stock and the Voting Preferred Stock, and the exercise
rights under the Stage I Warrants, the Stage II Warrants and the
Common Stock Warrants (as defined below) were exercised in full
immediately after the Stage II Closing, based on information furnished
by the Corporation, BANX would acquire approximately 45.3% of the
Fully-Diluted Common Shares (as defined
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in the Stage II Warrant); 27% of such Fully-Diluted Common Shares (or
21,900,651 Common Shares) at a price per share of $6.01; 9% of such
Fully-Diluted Common Shares (or 7,300,217 Common Shares) at a price
per share of $8.27; 4.5% of such Fully-Diluted Common Shares (or
3,650,108 Common Shares) at a price per share of $12.78; and 4.5% of
such Fully-Diluted Common Shares (or 3,650,108 Common Shares) at a
price per share of $17.29.
In addition, each of MMDS Holdings, Inc., a wholly owned
indirect subsidiary of Bell Atlantic Corporation, and NYNEX MMDS was
issued a warrant, dated as of January 9, 1995 (the "Common Stock
Warrants"), which permits the holder, for a period of five years, to
acquire 125,000 Common Shares at a price per share of $7.50, subject
to certain adjustments, including antidilution adjustments.
The foregoing description of the Senior Preferred Stock, the
Stage II Warrants and the Common Stock Warrants is qualified in its
entirety by reference to the complete text of each, a copy of which is
filed as part of Exhibit 1 and as Exhibits 4, 5, and 6, respectively to
Amendment No. 2 to the Schedule 13D.
BANX obtained the funds necessary to acquire the Senior
Preferred Stock and the Stage II Warrant from MMDS Holdings and NYNEX
MMDS. MMDS Holdings obtained the funds it provided to BANX from funds
provided from its affiliates from the working capital of its
affiliates. NYNEX MMDS obtained the funds it provided to BANX from
funds provided from its parent company from the working capital of its
parent company.
ITEM 4. PURPOSE OF TRANSACTION.
The Reporting Persons have acquired the securities purchased
under the Purchase Agreement and the Common Stock Warrants as an
investment. Depending on market conditions, the Reporting Persons may
acquire additional Common Shares through open market purchases, in
privately negotiated transactions or otherwise, subject to compliance
with Section 2.9 of the Purchase Agreement. In addition, the
Reporting Persons may use their rights as holders of the securities
purchased under the Purchase Agreement (the "Securities") to seek to
cause the Corporation to comply with its obligations under the
Purchase Agreement and the related agreements and arrangements,
including without limitation the Business Relationship Agreement.
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While it is not the present intention of BANX, MMDS Holdings
or NYNEX MMDS to do so, depending upon market conditions and the
course of action that the partners determine to pursue, the partners
(i) may, directly or indirectly, seek to acquire control of the
Corporation, or (ii) in compliance with applicable securities laws,
may, directly or indirectly, attempt to dispose of some or all of the
shares of Common Shares then beneficially owned by any of the
Reporting Persons, in the open market, in privately negotiated
transactions or otherwise.
Other than as disclosed in this Statement and except for
enforcement by BANX and its affiliates of their respective rights
under the Transaction Documents in the ordinary course of their
businesses, none of the Reporting Persons, and to the best knowledge
of the Reporting Persons, none of the persons named in Schedules I,
II, III and IV hereto, presently has any plan or proposal that relates
to or might result in any of the events described in Items (a) through
(j) of the instructions to Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a)(b) BANX has shared voting rights over, and therefore
beneficial ownership of 19,862,150 Common Shares, representing
approximately 34.6% of the Fully-Diluted Common Shares (as defined in
the Stage II Warrant). Each of MMDS Holdings, NYNEX MMDS, BAC and
NYNEX has shared voting and dispositive power over and beneficial
ownership of 36,626,085 Common Shares, representing approximately
45.3% of the Fully-Diluted Common Shares (as defined in the Stage II
Warrant).
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER.
On December 19, 1996, the Board of Directors of NYNEX
approved the Modification Agreement dated as of December 12, 1996 (the
"Modification Agreement") entered into by CAI, BANX, MMDS Holdings,
Inc., MMDS Holdings II, Inc., NYNEX MMDS Company and NYNEX MMDS
Holding Company (the "BANX Parties").
As previously disclosed in the joint press release dated
December 13, 1996 filed as an Exhibit hereto and in CAI's Form 8-K
filed January 3, 1997, the Modification Agreement, among other things,
provides CAI or its designee the right to acquire all, but not less
than all, of the $100 million investment by the BANX Parties, for a
period of 12 months from December 12, 1996. Such investment consists
of: (i) 7,000 shares of 14% Senior Preferred Stock of CAI, par value
$10,000 per share (the "Senior Preferred Stock"), (ii) $30 million
principal amount of Term Notes (the "Term Notes"), and (iii) two
warrants (the
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"Warrants") to purchase convertible preferred stock, no par value, of
CAI (the "Voting Preferred Stock"; and together with the Senior
Preferred Stock, the Term Notes and the Warrants, the "CAI
Securities"). If notice to purchase the CAI Securities is received by
the BANX Parties within the first 120 days following execution of the
Agreement, the purchase price is $121,000,000; if received in the next
120 days, the purchase price is $100,000,000, together with accrued
interest and dividends, plus $10,000,000; and if notice is received in
the balance of the year, the purchase price is $100,000,000, together
with accrued interest and dividends, plus $20,000,000. No notice of
intended purchase has been received as of the date of this filing.
The BANX Parties' $100,000,000 investment in the CAI
Securities includes convertible debt and preferred stock and warrants,
all of which if fully converted and exercised would result in the
right to acquire up to approximately 45% of the equity of CAI. As
part of the Modification Agreement, the Initial Tier 1 Conversion
Price and the Initial Tier I Exercise Price for the Senior Preferred
Stock and the Warrants, respectively, were reduced to $3.86 per common
share equivalent and the Initial Tier 2 Exercise Price, the Initial
Tier 3 Exercise Price and the Initial Tier 4 Exercise Price were
proportionately reduced, in each case subject to adjustment as
provided in the Warrants. The exercise prices are subject to further
reduction in the event the option to acquire the CAI Securities is not
exercised within 180 days.
In the event that CAI does not purchase the CAI Securities
or cannot locate a third party purchaser to do so within the first 270
days, the BANX Parties have the right to sell the CAI Securities free
and clear of the option.
The foregoing description of the Modification Agreement is
qualified in its entirety by reference to the complete text of the
Modification Agreement, a copy of which is filed as Exhibit 1 hereto
and incorporated herein by reference.
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ITEM 7. MATERIALS TO BE FILED AS EXHIBITS.
1. Modification Agreement, dated as of December 12, 1996, among CAI,
BANX, MMDS Holdings, Inc., MMDS Holdings, NYNEX MMDS Company and
NYNEX MMDS.
2. Joint Press Release dated Decmeber 13, 1996.
3. Current Report on Form 8-K (incorporated by reference to the Form
8-K filed by CAI with the SEC on January 3, 1997).
4. Joint Filing Letter Agreement, dated as of March 29, 1995.
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SIGNATURE
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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.
Date: January 27, 1997 BANX PARTNERSHIP,
a Delaware general partnership
By: MMDS HOLDINGS II, Inc.,
General Partner
By: /s/ Jane F. Ludlow
---------------------------
Name: Jane F. Ludlow
Title: Secretary
By: NYNEX MMDS HOLDING
COMPANY,
General Partner
By: /s/ Steven Fadem
---------------------------
Name: Steven Fadem
Title: Acting President
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SIGNATURE
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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.
BELL ATLANTIC CORPORATION
Date: January 27, 1997 By: /s/ P. Alan Bulliner
--------------------------
Name: P. Alan Bulliner
Title: Secretary
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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.
MMDS HOLDINGS II, INC.
Date: January 27, 1997 By: /s/ Jane F. Ludlow
---------------------
Name: Jane F. Ludlow
Title: Secretary
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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.
NYNEX MMDS HOLDING COMPANY
Date: January 27, 1997 By: /s/ Steven Fadem
---------------------
Name: Steven Fadem
Title: Acting President
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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.
NYNEX CORPORATION
Date: January 27, 1997 By: /s/ Darlene D. Kleiner
--------------------------------
Name: Darlene D. Kleiner
Title: Assistant Secretary
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SCHEDULE I
MMDS HOLDINGS II, INC.
A DELAWARE CORPORATION LOCATED AT
1310 NORTH COURT HOUSE ROAD,
ARLINGTON, VA 22201
EXECUTIVE OFFICERS AND DIRECTORS
Name and Address Position and Principal Occupation
---------------- ---------------------------------
Janet M. Garrity President, Treasurer and
501 Carr Road, Suite 201 Director
Wilmington, DE 19809
Alexander H. Good Chief Executive Officer
1320 N. Court House Road
Arlington, VA 22201
Jane Ludlow Secretary
1717 Arch Street
32nd Floor
Philadelphia, PA 19103
Ellen C. Wolf Chief Financial Officer and
Bell Atlantic Corporation Director
1717 Arch Street
Philadelphia, PA 19103
William O. Albertini Director
Bell Atlantic Corporation
1717 Arch Street
Philadelphia, PA 19103
Joshua W. Martin Director
Bell Atlantic - Delaware
901 Tatnall Street
Wilimington, DE 19801
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None of the individuals listed above in the last five years
(i) has been convicted in a criminal proceeding or (ii) was 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.
Each of the individuals listed above is a citizen of the United
States.
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SCHEDULE II
BELL ATLANTIC CORPORATION
--------------------------
A DELAWARE CORPORATION
LOCATED AT 1717 ARCH STREET,
PHILADELPHIA, PA 19103
EXECUTIVE OFFICERS AND DIRECTORS
Name and Address Position and Principal Occupation
---------------- ---------------------------------
Raymond W. Smith Chairman of the Board and Chief
Bell Atlantic Corporation Executive Officer of BAC
1310 N. Court House Road
Arlington, VA 22201
Lawrence T. Babbio, Jr. Vice Chairman of BAC
Bell Atlantic Corporation
1717 Arch Street
Philadelphia, PA 19103
James G. Cullen Vice Chairman of BAC
Bell Atlantic Corporation
1310 N. Court House Road
Arlington, VA 22201
William O. Albertini Executive Vice President and
Bell Atlantic Corporation Chief Financial Officer of BAC
1717 Arch Street
Philadelphia, PA 19103
Alexander H. Good Vice President-Strategic
Bell Atlantic Corporation Planning and Corporate
1310 N. Court House Road Development of BAC
Arlington, VA 22201
P. Alan Bulliner Vice President-Corporate
Bell Atlantic Corporation Secretary and Counsel of BAC
1717 Arch Street
Philadelphia, PA 19103
Doreen A. Toben Vice President-Finance and
Bell Atlantic Corporation Controller of BAC
1717 Arch Street
Philadelphia, PA 19103
Ellen C. Wolf Vice President-Treasurer
Bell Atlantic Corporation
1717 Arch Street
Philadelphia, PA 19103
Patrick C.G. Coulter Vice President-Corporate
Bell Atlantic Corporation Communication
1310 N. Court House Road
Arlington, VA 22201
Kevin P. Pennington Vice President-Human Resources
Bell Atlantic Corporation
1310 N. Court House Road
Arlington, VA 22201
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John F. Gamba Senior Vice President-Corporate
Bell Atlantic Corporation Resources and Performance
1310 N. Court House Road Assurance of BAC
Arlington, VA 22201
Bruce S. Gordon Group President-Consumer and
Bell Atlantic Network Small Business Services of Bell
Services, Inc. Atlantic Network Services, Inc.
1310 N. Court House Road
Arlington, VA 22201
Stuart C. Johnson Group President-Large Business
Bell Atlantic Network and Information Services of Bell
Services, Inc. Atlantic Network Services, Inc.
1310 N. Court House Road
Arlington, VA 22201
Thomas R. McKeough Philadelphia, PA 19103Vice
Bell Atlantic Corporation President-Mergers and
1717 Arch Street Acquisitions and Associate
General Counsel of BAC
James R. Young Vice President and General
Bell Atlantic Corporation Counsel of BAC
1310 N. Court House Road
Arlington, VA 22201
William W. Adams Director of BAC
11 Spring Dell Road
Lancaster, PA 17601
Thomas E. Bolger Chairman of the Executive
Bell Atlantic Corporation Committee of the Board of
1717 Arch Street Directors of BAC
Philadelphia, PA 19103
Frank C. Carlucci Chairman of The Carlyle Group
The Carlyle Group (merchant banking); Director of
1001 Pennsylvania Avenue, N.W. BAC
Washington, DC 20004
Eckard Pfeiffer President and Chief Operating
Compaq Computer Corporation Officer
P.O. Box 69200-MS 110802 Compaq Computer Corporation;
Houston, TX 77269 Director of BAC
James H. Gilliam, Jr. Executive Vice President and
Beneficial Corporation General Counsel of Beneficial
1 Christina Centre Corporation (financial
301 N. Walnut Street services); Director of BAC
Wilmington, DE 19801
Thomas H. Kean President of Drew University;
Drew University Director of BAC
36 Madison Avenue
Madison, NJ 07940
John F. Maypole Managing Partner of Peach State
157 Lake Dr. Real Estate Holding Company and
Mountain Lakes, NJ 07046 Consultant; Director of BAC
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Joseph Neubauer Chairman of the Board and Chief
ARAMARK Corporation Executive Officer of ARAMARK
1101 Market Street Corporation; Director of BAC
Philadelphia, PA 19107
Thomas H. O'Brien Chairman and Chief Executive
PNC Bank Corp. Officer of PNC Bank Corp.;
5th Avenue & Wood Street Director of BAC
Pittsburgh, PA 15222
Rozanne L. Ridgway Co-Chair of The Atlantic Council
The Atlantic Council of the of the United States (a private
United States foreign policy institute);
910 17th Street, N.W. Director of BAC
Washington, DC 20006
Shirley Young Vice President, China Strategic
General Motors Corporation Development of General Motors
3044 West Grand Boulevard Corporation; Director of BAC
Detroit, MI 48202
None of the individuals listed above in the last five years
(i) has been convicted in a criminal proceeding or (ii) was 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.
Each of the individuals listed above is a citizen of the United
States.
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SCHEDULE III
NYNEX MMDS HOLDING COMPANY
--------------------------
A DELAWARE CORPORATION
LOCATED AT 1095 AVENUE OF THE AMERICAS,
NEW YORK, NY 10036
EXECUTIVE OFFICERS AND DIRECTORS
NAME AND ADDRESS POSITION AND PRINCIPAL OCCUPATION
---------------- ---------------------------------
Steven S. Fadem Director and Vice President,
NYNEX Corporation President of NYNEX Entertainment &
22nd Floor Information Services Company
1166 Avenue of the Americas
New York, NY 10036
Melvin Meskin Director and President,
NYNEX Corporation Vice President and Comptroller of
41st Floor NYNEX Corporation
1095 Avenue of the Americas
New York, NY 10036
Timothy J. Downey Vice President,
NYNEX Corporation Director of Corporate Strategy and
22nd Floor Planning, NYNEX Entertainment &
1166 Avenue of the Americas Information Services Company
New York, NY 10036
Darlene D. Kleiner Secretary,
NYNEX Corporation Counsel and Assistant Secretary of
38th Floor NYNEX Corporation
1095 Avenue of the Americas
New York, NY 10036
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Andrew Coticchio Comptroller,
NYNEX Corporation Assistant Comptroller of NYNEX
Room 3023 Corporation
1095 Avenue of the Americas
New York, NY 10036
Roslyn G. Grigoleit Assistant Comptroller,
NYNEX Corporation Staff Director of State Tax
31st Floor Compliance of NYNEX Corporation
1095 Avenue of the Americas
New York, NY 10036
Christine A. Hillery Assistant Comptroller,
NYNEX Corporation Director of Sales and Gross Receipts
Room 3107 of NYNEX Corporation
1095 Avenue of the Americas
New York, NY 10036
Richard Weiss Assistant Comptroller,
NYNEX Corporation Director of Tax Administration of
31st Floor NYNEX Corporation
1095 Avenue of the Americas
New York, NY 10036
Colson P. Turner Treasurer,
NYNEX Corporation Vice President and Treasurer of
41st Floor NYNEX Corporation
1095 Avenue of the Americas
New York, NY 10036
Joseph A. Tomitz Assistant Treasurer,
NYNEX Corporation Assistant Treasurer of NYNEX
30th Floor Corporation
1095 Avenue of the Americas
New York, NY 10036
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None of the individuals listed above in the last five years (i) has
been convicted in a criminal proceeding or (ii) was 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.
Each of the individuals listed above is a citizen of the United
States.
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SCHEDULE IV
NYNEX CORPORATION
A DELAWARE CORPORATION
LOCATED AT 1095 AVENUE OF THE AMERICAS,
NEW YORK, NY 10036
EXECUTIVE OFFICERS AND DIRECTORS
NAME AND ADDRESS POSITION AND PRINCIPAL OCCUPATION
---------------- ---------------------------------
Ivan G. Seidenberg Director, Chairman of the Board and
NYNEX Corporation Chief Executive Officer of NYNEX
41st Floor Corporation
1095 Avenue of the Americas
New York, NY 10036
Frederic V. Salerno Director and Vice Chairman -
NYNEX Corporation Finance and Business Development of
41st Floor NYNEX Corporation
1095 Avenue of the Americas
New York, NY 10036
Morrison DeS. Webb Executive Vice President, General
NYNEX Corporation Counsel and Secretary of NYNEX
41st Floor Corporation
1095 Avenue of the Americas
New York, NY 10036
Robert T. Anderson Vice President - Business
NYNEX Corporation Development of NYNEX Corporation
41st Floor
1095 Avenue of the Americas
New York, NY 10036
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Jeffrey A. Bowden Vice President - Strategy and
NYNEX Corporation Corporate Assurance of NYNEX
41st Floor Corporation
1095 Avenue of the Americas
New York, NY 10036
John M. Clarke Vice President - Law of NYNEX
NYNEX Corporation Corporation
41st Floor
1095 Avenue of the Americas
New York, NY 10036
Saul Fisher Vice President - Law of NYNEX
NYNEX Corporation Corporation
41st Floor
1095 Avenue of the Americas
New York, NY 10036
Patrick F.X. Mulhearn Vice President - Public Relations of
NYNEX Corporation NYNEX Corporation
41st Floor
1095 Avenue of the Americas
New York, NY 10036
Donald J. Sacco Vice President - Human Resources of
NYNEX Corporation NYNEX Corporation
41st Floor
1095 Avenue of the Americas
New York, NY 10036
Thomas J. Tauke Vice President - Government Affairs
NYNEX Government Affairs Company of NYNEX Corporation
1300 I Street, NW
Washington, DC 20005
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Colson P. Turner Vice President and Treasurer of
NYNEX Corporation NYNEX Corporation
41st Floor
1095 Avenue of the Americas
New York, NY 10036
Melvin Meskin Vice President and Comptroller of
NYNEX Corporation NYNEX Corporation
41st Floor
1095 Avenue of the Americas
New York, NY 10036
Richard W. Blackburn President and Group Executive of
NYNEX Corporation Nynex Worldwide Communications
41st Floor Media Group
1095 Avenue of the Americas
New York, NY 10036
Arnold J. Eckelman Executive Vice President and Group
NYNEX Corporation Executive - Metro, NYNEX
41st Floor Telecommunications
1095 Avenue of the Americas
New York, NY 10036
Richard A. Jalkut President and Group Executive of
NYNEX Corporation NYNEX Telecommunications
41st Floor
1095 Avenue of the Americas
New York, NY 10036
Donald B. Reed President and Group Executive of
NYNEX Corporation NYNEX External Affairs and
41st Floor Corporate Communications
1095 Avenue of the Americas
New York, NY 10036
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John Brademas Director of NYNEX Corporation;
New York University President Emeritus of New York
11 West 42nd Street, Suite 400 University
New York, NY 10036
Richard L. Carrion Director of NYNEX Corporation;
Banco Popular de Puerto Rico President and Chief Executive Officer
209 Munoz Rivera Avenue of Banco Popular de Puerto Rico
Hato Rey, PR 00918
Lodewijk J.R. de Vink Director of NYNEX Corporation;
Warner-Lambert Company President and Chief Operating Officer
201 Tabor Road of Warner-Lambert Company
Morris Plains, NJ 07950
Stanley P. Goldstein Director of NYNEX Corporation;
CVS Corporation Chairman of the Board and Chief
One CVS Drive Executive Officer of CVS Corporation
Woonsocket, RI 02895
Helene L. Kaplan Director of NYNEX Corporation;
Skadden, Arps, Slate, Of Counsel to Skadden Arps, Slate
Meagher & Flom, Meagher & Flom, L.L.P.
919 Third Avenue
New York, NY 10022
Elizabeth T. Kennan Director of NYNEX Corporation;
197 County Road President Emeritus of Mount Holyoke
Ipswich, MA 01938 College
Edward E. Phillips Director of NYNEX Corporation;
83 Webster Road Director of New England Mutual
Weston, MA 02193 Life Insurance Company
Hugh B. Price Director of NYNEX Corporation;
National Urban League, Inc. President and Chief Executive Officer
500 East 62nd Street of National Urban League, Inc.
New York, NY 10021
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Walter V. Shipley Director of NYNEX Corporation;
The Chase Manhattan Corporation Chairman of the Board and Chief
270 Park Avenue Executive Officer of The Chase
New York, NY 10017-2070 Manhattan Corporation
John R. Stafford Director of NYNEX Corporation;
American Home Products Corporation Chairman of the Board, President
and 5 Giralda Farms Chief Executive Officer of
American Madison, NJ 07940 Home Products Corporation
None of the individuals listed above in the last five years (i) has
been convicted in a criminal proceeding or (ii) was 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.
Each of the individuals listed above is a citizen of the United
States.
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EXHIBIT INDEX
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Exhibit
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1. Modification Agreement, dated as of December 12, 1996,
among CAI, BANX, MMDS Holdings, Inc., MMDS Holdings,
NYNEX MMDS Company and NYNEX MMDS.
2. Joint Press Release dated Decmeber 13, 1996.
3. Current Report on Form 8-K (incorporated by reference
to the Form 8-K filed with the SEC by CAI on January 3, 1997).
4. Joint Filing Letter Agreement, dated as of March 29, 1995.
NYFS10...:\86\65886\0021\1708\SCH1217T.33C
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MODIFICATION AGREEMENT
MODIFICATION AGREEMENT dated as of December 12, 1996 among
CAI WIRELESS SYSTEMS, INC., a Connecticut corporation ("CAI"), the
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subsidiaries of CAI listed on the signature pages hereto
(collectively with CAI, the "Company"), BANX PARTNERSHIP, a Delaware
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general partnership ("BANX"), MMDS HOLDINGS, INC., a Delaware
----
corporation ("MMDS Holdings"), MMDS HOLDINGS II, INC., a Delaware
-------------
corporation ("MMDS Holdings II"), NYNEX MMDS COMPANY, a Delaware
----------------
corporation ("NYNEX MMDS"), and NYNEX MMDS HOLDING COMPANY, a Delaware
----------
corporation ("NYNEX MMDS Holding").
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RECITALS
1. The Company and BANX are parties to a Securities
Purchase Agreement dated as of March 28, 1995, as amended (the
"Securities Purchase Agreement"; capitalized terms defined
-----------------------------
therein and used but not defined herein being used as therein
defined), pursuant to which CAI issued and sold and BANX
purchased (i) CAI's Term Notes due 2005 (the "Notes") in an
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aggregate original principal amount of $30,000,000, (ii) 7,000
shares of CAI's 14% Senior Preferred Stock, par value $10,000 per
share (the "Senior Preferred Stock"), and (iii) warrants (the
----------------------
"Warrants") to purchase CAI's Series C Convertible Preferred
--------
Stock. The Notes, the Senior Preferred Stock and the Warrants
are referred to herein collectively as the "Purchased
---------
Securities".
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2. The Company, NYNEX MMDS and MMDS Holdings are parties
to a Business Relationship Agreement dated as of March 28, 1995,
as amended (the "BR Agreement"), pursuant to which the Company
------------
has, among other things, granted to NYNEX MMDS and MMDS Holdings
options, on a market by market basis, to cause the Company to
provide wireless cable transmission services to NYNEX MMDS and
MMDS Holdings using the Company's transmission systems in
specified markets in their respective service areas.
3. The parties desire to modify their contractual
arrangements under the Securities Purchase Agreement and the BR
Agreement and with respect to the Purchased Securities, as set
forth herein.
Accordingly, the parties hereby agree as follows:
Section 1. Option to Purchase Securities. BANX and its
-----------------------------
partners, NYNEX MMDS Holding and MMDS Holdings II, hereby
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grant to CAI or its designee the right and option, exercisable for a
period of twelve (12) months following the date of this Agreement, to
purchase all (but not less than all) of the Purchased Securities,
including all accrued and unpaid dividends thereon, for an aggregate
purchase price equal to the Purchase Price specified below. The
option shall be exercised by written notice to BANX, NYNEX MMDS and
MMDS Holdings II in accordance with the Securities Purchase Agreement,
which notice shall identify any designee and shall provide information
in reasonable detail with respect to the creditworthiness of any
designee and of the expected source of funds for the purchase. If the
designee (which for purposes of this sentence shall include the
ultimate parent or entity which controls the designee) is not required
to file reports pursuant to the Securities Exchange Act of 1934, then
CAI shall have thirty (30) days from the date of the notice to provide
the financial information (including the expected source of funds)
required under the immediately preceding sentence. If the notice from
CAI includes a request to keep the identity of the designee (if any)
confidential, the sellers will not publicly disclose the designee's
identity, until such time as the identity of the designee as the
purchaser of the Purchased Securities is otherwise made public, except
as may otherwise be required by any applicable law, rule, regulation,
court order or requirement of a government entity, including without
limitation, the rules or regulations of any securities exchange. Upon
such exercise, the purchase and sale of the Purchased Securities shall
occur at the offices of NYNEX MMDS Holding in New York City on the
date, not later than ninety (90) days following the date of the notice
of exercise, as shall be specified by CAI in such notice of exercise,
at which closing BANX, NYNEX MMDS Holding and MMDS Holdings II shall
deliver the certificates or other instruments representing the
Purchased Securities to CAI or its designee (without representation or
warranty except as to title) against payment of the Purchase Price in
immediately available funds, and CAI shall deliver such legal
opinions, opinions of financial advisors and officers' certificates as
may reasonably be requested by the sellers or as may be customary for
transactions of such nature, provided that if CAI or its designee is
unable to close within such 90-day period solely due to the document
deliveries required pursuant to this sentence, then at the election of
CAI in writing to sellers not less than 2 business days prior to the
expiration of such 90-day period, the full Purchase Price may be
deposited in an interest bearing account for a period of up to thirty
(30) days in order to permit the purchaser to satisfy such delivery
requirements and the closing shall be deemed timely if consummated
within such 30-day period provided the sellers shall be paid all
interest accrued on such funds during such period in
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addition to the Purchase Price. The parties will use reasonable
efforts to agree upon the form of such documents within forty five
(45) days after the execution of this Agreement; provided, however,
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that the failure of the parties to so agree shall not relieve any
party of its obligation to deliver the required documents in a form
reasonably satisfactory to the receiving parties. The Purchase Price
for the Purchased Securities shall equal the amount specified below
opposite the applicable number of days following the date of this
Agreement on which the notice of exercise is delivered by CAI to BANX,
NYNEX MMDS Holding and MMDS Holdings II:
Notice of Option Exercise Purchase Price
------------------------- --------------
up to 120 days $121,000,000
after 120 days up to 240 days $100,000,000 plus payment in
full of all accrued interest
and dividends under the Notes
and Senior Preferred Stock as
of the date of notice plus
$10,000,000.
after 240 days up to 365 days $100,000,000 plus payment in
full of all accrued interest
and dividends under the Notes
and Senior Preferred Stock as
of the date of notice plus
$20,000,000.
Notwithstanding anything to the contrary herein, (i) in the event CAI
shall fail to consummate the purchase of the Purchased Securities in
accordance with the terms of this Agreement and without limitation to
any other remedies of BANX, NYNEX MMDS or MMDS Holdings occasioned by
such failure, the option to purchase pursuant to this Section 1 shall
terminate automatically and without further action of the parties, and
(ii) in the event the option to purchase pursuant to this Section 1 is
not exercised in accordance herewith on or before the 270th day
following the date of this Agreement, BANX, NYNEX MMDS Holding and
MMDS Holdings II shall have the right to sell the Purchased Securities
free and clear of the option granted hereby and the rights of the
Company pursuant hereto upon twenty (20) days' prior notice to CAI,
provided that CAI or its designee does not exercise the option in
accordance herewith within a period of ten (10) days following the
date of such notice to CAI. During the option period, CAI
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shall make commercially reasonable efforts to secure the funds
required to exercise the option or to otherwise find a purchaser for
the Purchased Securities. If CAI engages in discussions or
negotiations with entities which have an interest in investing in the
Company, it shall offer such entities the option of acquiring the
Purchased Securities. CAI agrees that it shall take no action, (other
than actions in the ordinary course of its business) the effect of
which could reasonably expected to make the acquisition of the
Purchased Securities less attractive to a prospective purchaser. If
CAI obtains funds sufficient to acquire the Purchased Securities, it
shall use commercially reasonable efforts to obtain any consents or
other authorizations required to permit it to exercise the option
hereunder.
Section 2. Exercise and Conversion Prices.
------------------------------
(a) Effective upon the execution and delivery of this
Agreement, (i) the Initial Tier I Conversion Price and the Initial
Tier I Exercise Price for the Senior Preferred Stock and the Warrants,
respectively, shall be reduced to an amount equal the product of the
Preferred Conversion Ratio (as defined in the Purchased Securities)
multiplied by $3.86, and (ii) the Initial Tier 2 Exercise Price, the
Initial Tier 3 Exercise Price and the Initial Tier 4 Exercise Price
shall be reduced by multiplying such amounts by a fraction, the
numerator of which is equal to the Initial Tier I Exercise Price
immediately after giving effect to the reduction pursuant to clause
(i) of this Section 2(a) and the denominator of which is equal to the
Initial Tier I Exercise Price immediately prior to giving effect to
such reduction.
(b) In the event CAI shall not have exercised its option to
purchase the Purchased Securities on or prior to 180 days after the
date of this Agreement, (i) the Initial Tier I Conversion Price and
the Initial Tier I Exercise Price for the Senior Preferred Stock and
the Warrants, respectively, in each case shall be further reduced by
an amount equal to 15% of the Initial Tier 1 Exercise Price
immediately prior to any and all such adjustments, and (ii) in each
case the Initial Tier II Exercise Price, the Initial Tier III Exercise
Price and the Initial Tier IV shall be reduced by multiplying such
price by a fraction, the numerator of which is equal to the Initial
Tier I Exercise Price immediately after giving effect to the reduction
pursuant to clause (i) of this Section 2(b) and the denominator of
which is equal to the Initial Tier I Exercise Price immediately prior
to giving effect to such reduction.
(c) Each reduction pursuant to this Section 2 shall be
cumulative with and in addition to any other reductions or
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adjustments to the applicable prices pursuant hereto or under the
other applicable documents governing the Purchased Securities and each
adjustment pursuant hereto shall be affected prior to any adjustments
pursuant to such other documents.
(d) The reduction provided for in Section 2(b) above shall
not apply in the event of an exercise of the conversion rights of the
Notes or Senior Preferred Stock or an exercise of the Warrants by BANX
or its affiliates.
Section 3. Suspension of BR Agreement. Effective upon
--------------------------
the execution and delivery of this Agreement, the right of NYNEX MMDS
and MMDS Holdings to exercise the options, and the obligations of the
Company to perform by the specified dates, under the BR Agreement
shall be suspended and the running of all other time periods
thereunder shall be tolled. If CAI shall purchase all of the
Purchased Securities pursuant to the exercise of its option in
accordance with Section 1 of this Agreement, the BR Agreement and all
rights and obligations of the parties thereunder shall terminate. If
CAI shall fail to provide notice of the exercise of its option to
purchase the Purchased Securities pursuant to Section 1 hereof on or
prior to the first anniversary of the date of this Agreement and
consummate a purchase transaction pursuant to Section 1 hereof, the BR
Agreement and the rights and obligations of the parties shall be
reinstated automatically and without further action of the parties,
and all time periods for performance or the exercise of any rights or
obligations thereunder, including the right to exercise the options by
NYNEX MMDS and MMDS Holdings thereunder, shall be extended by a period
equal to the period of the suspension of the BR Agreement pursuant to
this Section 3, provided that, following the end of the suspension
period, the parties agree to negotiate in good faith to amend the BR
Agreement; provided further however, that the parties are under no
obligation to agree to any amendments, modifications or waivers of the
BR Agreement other than with respect to the elimination of the
existing "Fulfillment Dates" (as defined in the BR Agreement"). The
suspension of the BR Agreement, and any reinstatement thereof, shall
not effect a waiver of any rights, obligations or claims of the
parties thereto for any period prior to such suspension or after such
reinstatement and this Agreement shall not constitute a consent to any
modification of such rights, obligations or claims except as expressly
provided hereunder.
Section 4. CS Consent Rights; Conveyance of Stock. (a)
--------------------------------------
All rights of BANX and its affiliates to consent to the exercise by
CAI of its right to approve or disapprove of the
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taking of any actions by CS Wireless Systems, Inc. pursuant to the
terms of the Consent dated February 23, 1996 (the "CS Consent") among
CAI, BANX and its affiliates shall be terminated effective upon the
execution and delivery of this Agreement.
During the option period, BANX and its affiliates party
hereto agree to grant CAI a proxy for the purposes of voting their
respective shares of CS Wireless Systems, Inc. ("CS") common stock;
provided, however, that with respect to votes regarding the following
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matters, CAI must vote the shares of CS held by BANX and its
affiliates as directed by such parties:
any shareholder approval sought in connection with a public
offering of CS equity securities in the event that CAI proposes to
vote against such a transaction;
any shareholder approval in connection with a merger,
business combination, sale of all or substantially all of CS' assets
or any similar transaction, other than a transaction in which the
holders of CS common stock would become the holders of tradable
securities in a publicly traded entity, unless CAI has notified BANX
that it proposes to vote in favor of such transaction;
any shareholder approval in connection with a transaction
between CS and CAI and/or any of their respective affiliates;
any shareholder approval in connection with a redemption or
repurchase of CS' equity securities or the declaration of any
dividends; and
any transaction, other than a sale of CS equity securities
for cash, that would dilute the interest of BANX and its affiliates in
CS or grant any entity greater voting rights.
CAI will inform BANX if it proposes to exercise the proxy granted
hereunder. If the proxy would be voted in connection with one or more
of the items listed in this Section 4(b), CAI will describe the action
to be approved and CAI's intention to exercise the proxy for or
against such matter, and the notice containing the foregoing shall be
delivered as soon as possible, but in no event less than ten (10)
business days prior to the date of the vote. Unless BANX notifies CAI
prior to the actual vote that it objects to CAI's proposed vote, CAI
shall exercise the proxy as indicated in the notice.
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In the event CAI exercises the proxy granted hereunder other than at
the express direction of BANX, CAI shall defend, indemnify and hold
harmless each Indemnitee (as hereinafter defined) from and against any
and all Claims (as hereinafter defined) arising out of, in connection
with or as a result of exercise of the proxy.
(c) Upon the consummation of a purchase by CAI or its
designee in accordance with the provisions of Section 1 hereof, BANX
and its partners will transfer to CAI, for no additional
consideration, the shares of CS common stock conveyed to them pursuant
to the CS Consent. CAI shall pay any and all taxes (other than income
tax) or other costs and expenses payable to third parties as a result
of such transfer.
Section 5. Modification of Covenants. The covenants of
-------------------------
CAI in the Securities Purchase Agreement and in the Purchased
Securities shall be modified (i) to permit the Company to sell,
transfer or otherwise dispose of assets having a fair market value not
in excess of $2,000,000 in any one transaction or series of related
transactions from time to time to the extent permitted under the terms
of the Indenture governing CAI's 12-1/4% Senior Notes due 2002 as in
effect on the date of this Agreement and (ii) to suspend during the
term of the suspension of the BR Agreement pursuant to Section 3
hereof the right of BANX and its affiliates to approve of the Business
Plan of CAI and the following covenants in the Stage II Warrants (and
the corresponding provisions of the Stage I Warrants, the Term Notes
and the Senior Preferred Stock): Section 7.8 (other than the last
sentence thereof), 7.10(b), 7.19(d),, clause (iii) of 7.24 and 7.25.
Actions taken by CAI during the one-year period which would otherwise
have required consent under the suspended covenants shall not be
deemed to be a breach of such covenants following the termination of
such suspension; but only to the extent of actions completed or
transactions consummated as of the end of the suspension period,
provided, however, that CAI may continue to take actions, ministerial
or administrative in nature, required of CAI subsequent to the one-
year period in furtherance of the actions taken by CAI during the one-
year period, which actions shall not be deemed to be a breach of such
covenants following the termination of the suspension period.
Section 6. Removal of Equipment. Until the expiration
--------------------
of the options under the BR Agreement with respect to the Virginia
Beach and Boston markets, the Company will maintain the transmission
systems in Virginia Beach and Boston intact and will not, unless
consented to in writing by NYNEX MMDS or MMDS Holdings, as applicable,
sell, transfer or otherwise dispose of or remove from the site any of
the fixed assets or equipment
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located at or utilized in the transmission systems in Virginia Beach
or Boston, provided that CAI may remove and utilize for other purposes
(i) booster transmitters and associated equipment in Boston, other
than any equipment located at or used for the main transmitter and
associated systems at One Financial in Boston and (ii) booster
transmitters and associated equipment in Virginia Beach, other than
equipment used at the Virginia Beach main transmitter.
Section 7. Cooperation. The parties shall provide
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reasonable cooperation to each other in connection with facilitating
the sale of the Purchased Securities; provided, however, that such
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cooperation shall not require the parties to make any representations,
warranties or statements or incur any obligations other than those set
forth in Section 1.
Section 8. FCC Matters. For a period of one year from
-----------
the date hereof, each of BANX and its affiliates party hereto agrees
that it shall not oppose any FCC filing or application by CAI solely
for the purpose of: (i) transferring any of its MMDS, MDS or ITFS
leases or licenses; or (ii) modifying its authority to use such
spectrum for uses other than that permitted under existing law or
regulations, provided, however, that BANX and its affiliates party
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hereto will not be restricted from opposing any application or filing
described in clause (ii) where such application or filing, if granted,
could reasonably be expected to have the effect of restricting the
conduct of their business. Nothing in this Agreement shall have the
effect of limiting the ability of BANX and its affiliates to respond
to any communication to the FCC which they determine makes false,
misleading and/or negative reference (directly or indirectly) to BANX
or any of its affiliates.
Section 9. Publicity. The parties will make reasonable
---------
efforts to consult with each other prior to the issuance of a press
release regarding this Agreement. Following the dissemination of an
initial press release, the parties' obligations with respect to the
disclosure of the details of this Agreement shall be governed by the
applicable provisions of the agreements which this Agreement modifies.
Section 10. No Waiver. Failure by either party to insist
---------
on strict performance or observance of any provision of this Agreement
or to exercise any right or remedy shall not be construed as a waiver
of any right or remedy with respect to any existing or subsequent
breach or default. This Agreement shall not constitute a waiver,
compromise or relinquishment of any
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claims relating to the BR Agreement or the documentation governing the
Purchased Securities.
Section 11. Representations and Warranties. Each party
------------------------------
hereto represents and warrants to the other party that (a) such party
has all requisite legal power and authority to execute and deliver
this Agreement and to perform its obligations hereunder, (b) the
execution, delivery and performance hereof has been duly authorized by
all requisite corporate action on the part of such party, including
with respect to the Company by express Board of Directors
authorization, and (c) this Agreement (i) has been duly executed and
delivered by such party and (ii) subject to the due execution and
delivery of this Agreement by the other party hereto, this Agreement
constitutes a legal, valid and binding obligation of such party,
enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium and
similar laws or other laws affecting creditors' rights generally and
subject further to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at
law). Notwithstanding anything to the contrary herein, the
effectiveness of Section 1 hereof shall be contingent on the approval
of this Agreement to the extent required by the Boards of Directors of
Bell Atlantic Corporation and NYNEX Corporation, which if required
BANX and its affiliates agree to seek promptly following the date
hereof.
Section 12. Effect on Agreements. The provisions of this
--------------------
Agreement shall be narrowly construed in accordance with the express
provisions hereof and except as expressly amended or modified herein,
the Stock Purchase Agreement, the Purchased Securities and the BR
Agreement and each of the provisions thereof shall remain in full
force and effect in accordance with their respective terms.
Section 13. Miscellaneous.
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(a) Entire Agreement. This Agreement constitutes the
----------------
entire agreement between the parties with respect to the subject
matter hereof and supersedes any and all previous agreements,
representations and understandings between the parties hereto with
respect to such matters whether oral or in writing.
(b) Governing Law. This Agreement shall be governed by and
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construed in accordance with the law of the State of New York.
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(c) Severability. The invalidity or unenforceability of
------------
any provision of this Agreement shall not affect the validly or
enforceability of any other provisions of this Agreement, each of
which shall remain in full force and effect.
(d) No Third Party Beneficiaries. This Agreement shall be
----------------------------
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Nothing in this Agreement shall
create or be deemed to create any third party beneficiary rights in
any person not party to this Agreement.
(e) Amendments. This Agreement may be amended,
----------
supplemented or modified, and any provision hereof may be waived, only
pursuant to a written instrument making specific reference to this
Agreement signed by each of the parties hereto.
(f) Counterparts. This Agreement may be executed in any
------------
number of counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
Section 13. Expenses and Indemnification. Without
----------------------------
limitation to Section 7.1 and 7.2 of the Securities Purchase
Agreement:
(i) each party will pay its own costs and expenses
(including reasonable fees, charges and disbursements of counsel)
incurred in connection with the preparation, negotiation and execution
of this Agreement; and
(ii) the Company agrees to indemnify BANX and its affiliates
and their respective directors, officers, employees and agents (each
such Person being an "Indemnitee") against, and to hold each
----------
Indemnitee harmless from, any and all losses, claims, damages,
liabilities, penalties and related costs and expenses (collectively,
"Claims"), including counsel fees, charges and disbursements, incurred
by or asserted against any Indemnitee arising out of, in any way in
connection with, or as a result of (i) the execution, delivery or
performance of this Agreement or of any document contemplated hereby
or the consummation of any of the transactions contemplated hereby,
(ii) any exercise by any Indemnitee of its rights and remedies
hereunder, or (iii) any claim litigation, investigation or proceeding
relating to any of the foregoing, whether or not any Indemnitee is a
party thereto; provided, however, that such indemnity shall not, as to
-------- -------
any Indemnitee, apply to any such losses, claims, damages,
liabilities, penalties or related costs
<PAGE>
<PAGE>
and expenses or portion thereof arising exclusively from the material
breach, gross negligence or wilful misconduct of such Indemnitee, or
from any act or failure to act of an Indemnitee under any other
agreement or legal obligation of such Indemnitee where the Indemnitee
was under a legal obligation to act or abstain from acting, in any
such case, as determined by final order of a court of competent
jurisdiction.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement through their duly authorized representatives on the day and
year first above written.
CAI WIRELESS SYSTEMS, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
ROCHESTER CHOICE TELEVISION,
INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
HAMPTON ROADS WIRELESS, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
EASTERN NEW ENGLAND TV, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
CONNECTICUT CHOICE TELEVISION, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
<PAGE>
<PAGE>
COMMONWEALTH CHOICE
TELEVISION, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
ATLANTIC MICROSYSTEMS, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
HOUSATONIC WIRELESS, INC.
SYSTEMS, INC., d/b/a
CAPITAL CHOICE TELEVISION
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
NISAKAYUNA ASSOCIATES, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
ONTEO ASSOCIATES, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
NEW YORK CHOICE TELEVISION, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
CAI TRANSACTIONS P, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
<PAGE>
<PAGE>
CAI TRANSACTIONS W, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
CAI VA TRANSACTIONS, INC.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
CAI CT HOLDINGS CORP.
By:/s/ John J. Prisco
---------------------------
Name: John J. Prisco
Title:
BANX PARTNERSHIP
By: MMDS Holdings Inc.
By:/s/ Philip Marx
----------------------
Name: Philip Marx
Title: Assistant Secretary
By: NYNEX MMDS Company
By:/s/ Steven Fadem
----------------------
Name: Steven Fadem
Title: Vice President
MMDS HOLDINGS INC.
By:/s/ Philip Marx
---------------------------
Name: Philip Marx
Title: Assistant Secretary
<PAGE>
<PAGE>
MMDS HOLDINGS II INC.
By:/s/ Philip Marx
--------------------------------
Name: Philip Marx
Title: Assistant Secretary
NYNEX MMDS COMPANY
By:/s/ Steven Fadem
--------------------------------
Name: Steven Fadem
Title: Vice President
NYNEX MMDS HOLDING COMPANY
By:/s/ Steven Fadem
--------------------------------
Name: Steven Fadem
Title: Vice President
NYFS08...:\60\34460\0029\209\AGR1217Z.500
<PAGE>
December 13, 1996, Friday
Joint News Release Bell Atlantic, NYNEX, CAI Wireless
Systems Suspend Business Agreement For One Year;
CAI Provided with Option to Repurchase Bell Atlantic, NYNEX Investment
in CAI Securities; Changing Market Conditions, Full Service Network
Buildouts Lead to Re-Evaluation Of Plans for Digital Wireless Video
Strategy
Bell Atlantic (NYSE: BEL), NYNEX (NYSE: NYN) and CAI
Wireless Systems, Inc. (Nasdaq: CAWS) are suspending a 1995 business
agreement for one year and providing CAI with the option to repurchase
a $100 million investment in CAI securities made by Bell Atlantic and
NYNEX
Under a new agreement signed yesterday, the way has been
cleared for CAI to develop a more flexible approach to the use of its
MMDS spectrum, including the provision of video, voice and data
services in Northeast and mid-Atlantic markets.
Bell Atlantic and NYNEX said they were re-evaluating their
decision to use CAI's MMDS (Multichannel Multipoint Distribution
Service) transport systems as an early-to-market video strategy due to
a number of factors, including changing market conditions for
entertainment services, the technical availability of fiber-based Full
Service Networks and CAI's desire to expand its use of spectrum beyond
video transport.
As a result, the companies have re-negotiated a 1995
agreement to develop and deploy wireless video networks and have also
suspended plans to jointly launch wireless video services in Hampton
Roads, Va., and Boston, Mass., in 1997.
Under the terms of the agreement announced today, CAI will
be given an option for up to one year to purchase Bell Atlantic and
NYNEX'S interest in the company. The agreement also enables CAI to
expand the markets in which it may seek FCC approval for mixed use of
MMDS spectrum.
Bell Atlantic and NYNEX added that they continue to view the
marketplace for broadband services such as video and high speed data
connectivity over the Full Service Network as an attractive long term
growth strategy. Therefore, they are still evaluating a variety of
delivery systems for video and entertainment services.
<PAGE>
<PAGE>
Bell Atlantic is currently providing video programming over
its fiber network in Toms River, N.J., and recently announced
deployment plans to deploy switched digital video in the Philadelphia
market.
NYNEX also has selected switched digital technology as part
of the company's plan to deliver the next generation of network
technology to its customers. In October, NYNEX signed a multi-year
agreement with General Instrument that includes one million lines of
transport electronics to be deployed in metropolitan Boston and New
York City areas, as well as parts of Long Island and Westchester
County, N.Y. The first installation of this new technology, initially
for voice applications, will began in metropolitan Boston early next
year.
"CAI is anxious to test the versatility of its considerable
MMDS spectrum in new endeavors that combine video, voice and data
transmission," said Jared E. Abbruzzese, chairman and CEO of CAI. "We
have learned much from building digital wireless systems during this
trial. We appreciate that they have given us the opportunity to
charter a different destiny for our company, and we hope to
aggressively press the regulatory envelope for full flexible use of
MMDS spectrum."
CAI has been exploring mixed use of MMDS spectrum in markets
not covered by the original agreement with Bell Atlantic and NYNEX,
such as Rochester, N.Y., where the FCC has granted the company
authority for a market trial with 500 users. The company has also
requested FCC approval for a two-way flexible-use MMDS trial in
Hartford, Conn.
Through CS Wireless Systems, Inc., CAI's majority-owned
joint venture with Heartland Wireless Communications, Inc., the
company plans in 1997 to roll out a high speed Internet access service
combined with digital subscription television service in Dallas.
Bell Atlantic Corporation is at the forefront of the new
communications, entertainment and information industry. In the mid-
Atlantic region, the company is the premier provider of local
telecommunications and advanced services. Globally, it is one of the
largest investors in the high-growth wireless communication
marketplace. Bell Atlantic also owns a substantial interest in
Telecom Corporation of New Zealand and is actively developing high-
growth national and international business opportunities in all phases
of the industry.
<PAGE>
<PAGE>
INTERNET USERS: Bell Atlantic news releases, executive
speeches, news media contacts and other useful information are
available on Bell Atlantic's media relations World Wide Web site
(http://www.ba.com), or by gopher (gopher://ba.com). To receive news
releases via e-mail send a message to lists bell-atl.com.
NYNEX is a global communications and media corporation that
provides a full range of services in the northeastern United States
and high growth markets around the world, including the United
Kingdom, Thailand, Gibraltar, Greece, Indonesia, the Philippines,
Poland, Slovakia and the Czech Republic. The corporation is a leader
in telecommunications, wireless communications, directory publishing
and video and entertainment services.
NYNEX is also managing sponsor of FLAG -- Fiberoptic Link
Around the Globe -- the world's longest undersea fiber optic
communications cable. NYNEX news releases are now available on the
Internet at http://www.nynex.com. You can also receive fax copies of
recent NYNEX news releases free of charge, 24 hours a day. Call 1-
800-331-1214, and follow the automated system instructions.
CAI, based in Albany, N.Y., operates analog-based wireless
systems in New York City, Rochester and Albany, Philadelphia,
Washington, D.C., and Norfolk/Virginia Beach, Va., and has a portfolio
of wireless cable channel rights in eight additional markets,
including Long Island, Buffalo and Syracuse, N.Y., Providence, R.I.,
Hartford, Conn., Boston, Baltimore and Pittsburgh.
CAI is also conducting market trials of wireless Internet
access service in its Rochester market and has been granted authority
to test such service in New York City. In addition, CAI owns
approximately 52 per cent of CS Wireless Systems, Inc., which is
jointly owned by Heartland Wireless Communications, Inc. CS Wireless
has, on a pro forma basis for announced transactions, approximately
7.2 million line-of-sight (LOS) households and 77,550 subscribers in
17 markets located primarily in the Midwest and the Southwest regions
of the United States.
SOURCE Bell Atlantic Corporation
CONTACT: Brian R. Wood of Bell Atlantic Enterprises,
215-963-6204, or e-mail, brian.r.wood bell-atl.com, or Larry Plumb of
Bell Atlantic Video Services, 703-708-4360, or
<PAGE>
<PAGE>
e-mail, lawrence.d.plumb bell-atl.com; or Maureen Flanagan, 212-395-
3519, or e-mail, notes.mflanaga nynex.com, or Jack Hoey, 617-743-4760,
or e-mail, notes.jhoey nynex.com, both of NYNEX, or James P. Ashman of
CAI Wireless Systems,
5l8-462-2632.
<PAGE>
<PAGE>
December 13, 1996, Friday
PHF004, "Joint News Release: Bell Atlantic, NYNEX, CAI
Wireless Systems Suspend Business Agreement For One Year," moved
earlier today, we are advised that the CONTACT phone numbers for the
NYNEX contacts should read: "Maureen Flanagan, 212-395-0500, or e-
mail, notes.mflanaga nynex.com, or Jack Hoey, 617-743-3677, or e-mail,
notes.jhoeynynex.com, both of NYNEX;" rather than "Maureen Flanagan,
212-395-3519, or e-mail, notes.mflanaga nynex.com, or Jack Hoey, 617-
743-4760, or e-mail, notes.jhoey nynex.com, both of NYNEX;" as
originally issued (correcting only their telephone numbers).
<PAGE>
<PAGE>
December 13, 1996, Friday
PHF004 "Joint News Release: Bell Atlantic, NYNEX, CAI
Wireless Systems Suspend Business Agreement For One Year," moved
earlier today, was an incorrect version transmitted by PR Newswire.
The 7th graph, 2nd line should read "plans to deploy" rather
than "deployment plans to deploy."
The 11th graph should be deleted entirely.
The last paragraph, 1st sentence should be deleted.
The last paragraph, 6th line should read "approximately 6.2
million line-of-sight" rather than "7.2 million."
NYFS10...:\86\65886\0021\1708\OUT1237D.510
<PAGE>
JOINT FILING LETTER AGREEMENT
-----------------------------
Pursuant to Rule 13d-1(f)(1) promulgated by the Securities and
Exchange Commission under the Securities Exchange Act of 1934, as
amended, the undersigned hereby consent to the joint filing of a
single Schedule 13D statement on their behalf and to the joint filing
of any single amended Schedule 13D statements thereto. The
undersigned hereby further agree that this statement may be executed
in any number of counterparts, each of which when so executed shall be
deemed to be an original, but all of which counterparts shall together
constitute but one and the same instrument.
Signature Dated as of:
--------- ------------
NYNEX CORPORATION
/s/ Darlene D. Kleiner
-------------------------------
Name: Darlene D. Kleiner
Title: Assistant Secretary March 29, 1995
BELL ATLANTIC CORPORATION
/s/ P. Alan Bulliner
--------------------------------
Name: P. Alan Bulliner
Title: V.P.-Corp. Secy & Counsel March 29, 1995
NYNEX MMDS HOLDING COMPANY
/s/ Darlene D. Kleiner
-------------------------------
Name: Darlene D. Kleiner
Title: Secretary March 29, 1995
MMDS HOLDINGS II, INC.
/s/ Michelle A. Arrington
-------------------------------
Name: Michelle A. Arrington
Title: Secretary March 29, 1995
BANX PARTNERSHIP
By: NYNEX MMDS Holding Company,
as General Partner
/s/ Darlene D. Kleiner
-------------------------------
Name: Darlene D. Kleiner
Title: Secretary March 29, 1995
NYFS10...:\86\65886\0021\1708\LTR1227V.270