<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 13D
(Rule 13d-101)
Information to be included in statements filed pursuant
to Rule 13d-1(a) and amendments thereto filed pursuant to
Rule 13d-2(a)
PEOPLE'S CHOICE TV CORP.
(Name of Issuer)
COMMON STOCK, $.01 par value per share
(Title of Class of Securities)
710847104
(CUSIP Number)
STEVEN A. VAN DYKE
TOWER INVESTMENT GROUP, INC.
BAY HARBOUR MANAGEMENT, L.C.
777 South Harbour Island Boulevard, Suite 270
Tampa, Florida 33602
(813) 272-1992
DOUGLAS P. TEITELBAUM
885 Third Avenue
34th Floor
New York, New York 10022
(212) 371-2211
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
April 12, 1999
(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(e), 13d-1(f) or 13d-1(g), check the
following box. [X]
Note. Schedules filed in paper format shall include a signed original and
five copies of the schedule, including all exhibits. See Rule 13d-7(b) for
other parties to whom copies are to be sent.
(Continued on the following pages)
(Page 1 of 9 Pages)
<PAGE>
13D
- ----------------------- ---------------------
CUSIP NO. 710847104 PAGE 2 OF 9 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON STEVEN A. VAN DYKE
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON N/A
- ------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [_]
(b) [X]
- ------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------
4 SOURCE OF FUNDS OO,PF
- ------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [_]
- ------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION UNITED STATES
- ------------------------------------------------------------------------------
SOLE VOTING POWER - 0 -
7
NUMBER OF
SHARES -----------------------------------------------------------
SHARED VOTING POWER 886,595
BENEFICIALLY 8
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER - 0 -
9
REPORTING
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER 886,595
WITH 10
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
886,595
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
6.9%
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON IN,HC
14
- ------------------------------------------------------------------------------
<PAGE>
13D
- ----------------------- ---------------------
CUSIP NO. 710847104 PAGE 3 OF 9 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
NAME OF REPORTING PERSON Douglas P.Teitelbaum
1 I.R.S. IDENTIFICATION NO. OF ABOVE PERSON N/A
- ------------------------------------------------------------------------------
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
2 (a) [_]
(b) [X]
- ------------------------------------------------------------------------------
SEC USE ONLY
3
- ------------------------------------------------------------------------------
SOURCE OF FUNDS OO
4
- ------------------------------------------------------------------------------
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [_]
5
- ------------------------------------------------------------------------------
CITIZENSHIP OR PLACE OF ORGANIZATION United States
6
- ------------------------------------------------------------------------------
SOLE VOTING POWER -0-
7
NUMBER OF
SHARES -----------------------------------------------------------
SHARED VOTING POWER 886,595
BENEFICIALLY 8
OWNED BY
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER -0-
9
REPORTING
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER 886,595
WITH 10
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11 886,595
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
6.9%
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON
14
IN, HC
- ------------------------------------------------------------------------------
<PAGE>
13D
- ----------------------- ---------------------
CUSIP NO. 710847104 PAGE 4 OF 9 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON Tower Investment Group, Inc.
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 59-2924229
- ------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [_]
(b) [X]
- ------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------
4 SOURCE OF FUNDS
OO
- ------------------------------------------------------------------------------
5 CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e) [_]
- ------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Florida
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
886,595
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY - 0 -
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
886,595
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
- 0 -
- ------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
886,595
- ------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
[_]
- ------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.9%
- ------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON
HC
- ------------------------------------------------------------------------------
<PAGE>
SCHEDULE 13D
- ----------------------- ---------------------
CUSIP NO. 710847104 PAGE 5 OF 9 PAGES
- ----------------------- ---------------------
- ------------------------------------------------------------------------------
1 NAME OF REPORTING PERSON BAY HARBOUR MANAGEMENT, L.C.
I.R.S. IDENTIFICATION NO. OF ABOVE PERSON 59-3418243
- ------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [_]
(b) [X]
- ------------------------------------------------------------------------------
3 SEC USE ONLY
- ------------------------------------------------------------------------------
4 SOURCE OF FUNDS
OO
- ------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) or 2(e) [_]
- ------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
FLORIDA
- ------------------------------------------------------------------------------
SOLE VOTING POWER
7
NUMBER OF
886,595
SHARES -----------------------------------------------------------
SHARED VOTING POWER
BENEFICIALLY 8
OWNED BY - 0 -
-----------------------------------------------------------
EACH SOLE DISPOSITIVE POWER
9
REPORTING
886,595
PERSON -----------------------------------------------------------
SHARED DISPOSITIVE POWER
WITH 10
- 0 -
- ------------------------------------------------------------------------------
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
11
886,595
- ------------------------------------------------------------------------------
CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
12
[_]
- ------------------------------------------------------------------------------
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13
6.9%
- ------------------------------------------------------------------------------
TYPE OF REPORTING PERSON
14
IA
- ------------------------------------------------------------------------------
<PAGE>
Item 1. Security and Issuer.
Common Stock, $.01 par value per share ("PCTV Common Stock") of
People's Choice TV Corp., a Delaware corporation ("PCTV"). The principal
executive offices of PCTV are located at 2 Corporate Drive, Shelton, Connecticut
06484.
Item 2. Identity and Background.
Bay Harbour Management, L.C. ("Bay Harbour") is a Florida limited
company and a registered investment adviser under the Investment Advisers Act of
1940, as amended. Tower Investment Group, Inc., a Florida corporation
("Tower"), is the majority stockholder of Bay Harbour. Steven A. Van Dyke, a
resident of Florida and a United States citizen ("Van Dyke"), is a stockholder
of Tower. Douglas P. Teitelbaum, a resident of New York and a United States
citizen ("Teitelbaum" and, together with Bay Harbour, Tower and Van Dyke, the
"Reporting Persons"), is a stockholder of Tower. The executive officers and
directors of Bay Harbour and Tower are as follows:
<TABLE>
<CAPTION>
Name Address Occupation Place of Employment
<S> <C> <C> <C>
Steven A. Van Dyke 777 South Harbour Island investment Bay Harbour
Boulevard, Suite 270 management Management, L.C.
Tampa, Florida 33602
Douglas P. Teitelbaum 885 Third Avenue investment Bay Harbour
34th Floor management Management, L.C.
New York, New York 10022
</TABLE>
The principal business address of each Reporting Person is 777 South
Harbour Island Boulevard, Suite 270, Tampa, Florida 33602, except that the
principal business office of Teitelbaum is 885 Third Avenue, 34th Floor, New
York, New York 10022.
No Reporting Person has during the last five years (i) been convicted
in a criminal proceeding (excluding traffic violations or 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.
From February 5, 1997 through March 3, 1999, Bay Harbour purchased in
secondary trades on the open-market for certain of its managed accounts, 881,600
shares of PCTV Common Stock (the "Open Market Shares"), for an aggregate
purchase price of $1,489,720. The source of the funds used by Bay Harbour to
purchase the Open Market Shares were investment accounts managed on a
discretionary basis by Bay Harbour.
On March 24, 1998, Bay Harbour purchased in secondary trades on the
open-market for certain of its managed accounts, 3,500 warrants to purchase
4,995 shares of PCTV Common Stock (the "Warrants" and, together with the Open
Market Shares, the "Shares" ), for an aggregate purchase price of $209. The
source of the funds used by Bay Harbour to purchase the Warrants were investment
accounts managed on a discretionary basis by Bay Harbour.
<PAGE>
Item 4. Purpose of Transaction.
On April 12, 1999, the Reporting Persons entered into a Stockholder
and Option Agreement (the "Option Agreement") with Sprint Corporation ("Sprint")
pursuant to which the Reporting Persons granted Sprint an option (the "Option")
to purchase their shares of Common Stock ("Option Shares") at a price equal to
$8.00 per share of Common Stock, as adjusted if necessary ("Option Price"). If
the Option has not been exercised by Sprint within 10 days after the expiration
or termination of all applicable waiting periods under the Hart-Scott-Rodino
Antitrust Improvements Act and regulations thereunder, the Reporting Persons
have the right to require Sprint to purchase the Option Shares at the Option
Price.
The above description of the Option Agreement and related matters set
forth in this Item and in Item 6 are summaries, and are qualified in their
entirety by reference to the complete text of such Option Agreement which is
filed as an exhibit to this filing.
Although the foregoing reflects activities presently contemplated by
the Reporting Persons with respect to PCTV, the foregoing is subject to change
at any time. Except as set forth above or in Item 6, the Reporting Persons have
no present plans or intentions which would result in or relate to any of the
transactions described in subparagraphs (a) through (j) of Item 4 of Schedule
13D.
Item 5. Interest in Securities of the Issuer.
(a) As of April 22, 1999, (i) Van Dyke beneficially owns 886,595
shares of PCTV Common Stock, which represent approximately 6.9% of PCTV Common
Stock outstanding, (ii) Teitelbaum beneficially owns 886,595 shares of PCTV
Common Stock, which represent approximately 6.9% of PCTV Common Stock
outstanding, (iii) Tower beneficially owns 886,595 shares of PCTV Common Stock,
which represent approximately 6.9% of PCTV Common Stock outstanding and (iv) Bay
Harbour beneficially owns 886,595 shares of PCTV Common Stock, which represent
approximately 6.9% of PCTV Common Stock outstanding based upon 12,923,817 shares
of PCTV Common Stock outstanding as of March 25, 1999 as set forth in a 10-K
filed on March 31, 1999 with the U.S. Securities and Exchange Commission. For
purposes of disclosing the number of shares beneficially owned by each of the
Reporting Persons, (A) Van Dyke and Teitelbaum are deemed to beneficially own
all shares of PCTV Common Stock that are beneficially owned by Tower and Bay
Harbour and (B) Tower is deemed to beneficially own all shares of PCTV Common
Stock that are beneficially owned by Bay Harbour.
(b) Each Reporting Person has (i) the sole power to vote or direct
the vote of the 886,595 shares of PCTV Common Stock held by Bay Harbour; and
(ii) the sole power to dispose of or to direct the disposition of such 886,595
shares of PCTV Common Stock; except that Van Dyke and Teitelbaum share with each
other their voting and disposition power.
(c) Information Concerning transactions in the Shares of PCTV Common
Stock by the Reporting Persons is set forth in Exhibit III attached hereto,
which is incorporated herein by reference.
(d) The 886,595 shares of PCTV Common Stock held by Bay Harbour
reported in this Statement are beneficially owned by Van Dyke, Teitelbaum, Tower
and Bay Harbour for the benefit of certain investment partnerships and managed
accounts over which Van Dyke, Teitelbaum, Tower and Bay Harbour control the
power to (i) direct the voting of such shares of PCTV Common Stock and (ii)
dispose of such shares of PCTV Common Stock. The limited partners of the
investment partnerships and the investors in the managed accounts for which Bay
Harbour acts as an investment adviser have the
<PAGE>
right to participate in the receipt of dividends from, or proceeds from the sale
of, securities held by their funds or accounts, as the case may be. No such
fund, single limited partner of any of such funds nor any investor in a managed
account has the right to receive or the power to direct the receipt of dividends
from, or proceeds from the sale of, shares of PCTV Common Stock reported in this
Schedule 13D representing more than five percent of the outstanding PCTV Common
Stock.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understanding or Relationships with Respect to
Securities of the Issuer.
The Option Agreement sets forth certain terms and conditions under the
Reporting Persons' continued ownership of the Common Stock. Under the Option
Agreement, the Reporting Persons are prohibited from selling, transferring,
assigning, pledging, hypothecating or otherwise disposing of or limited its
right to vote in any manner any of its shares of Common Stock. In addition, the
Reporting Persons have irrevocably appointed Sprint as their proxy to vote the
Option Shares in any manner as Sprint, in its sole discretion, may see fit, at
any annual, special or other meeting or action of the stockholders of the
Company with respect to any issues brought before the stockholders of the
Company.
Except as described herein and by reference to Item 4 above, there are
no contracts, arrangements, understandings or relationships among the Reporting
Persons and Sprint with respect to any securities of the Issuer.
Item 7. Material to be filed as Exhibits.
EXHIBIT I Joint Filing Agreement, by and among Bay Harbour, Tower, Van
---------
Dyke and Teitelbaum.
EXHIBIT II Stockholder and Option Agreement, dated April 12, 1999, between
----------
Sprint and Bay Harbour.
EXHIBIT III Information concerning transactions in the Shares effected by
-----------
the Reporting Persons.
<PAGE>
SIGNATURES
After reasonable inquiry and to the best knowledge and belief of the
undersigned, the undersigned certifies that the information set forth in this
statement is true, complete and correct.
Dated as of: April 22, 1999 TOWER INVESTMENT GROUP, INC.
By: /s/ Steven A. Van Dyke
-----------------------------
Name: Steven A. Van Dyke
Title: President
BAY HARBOUR MANAGEMENT, L.C.
By: /s/ Steven A. Van Dyke
-----------------------------
Name: Steven A. Van Dyke
Title: President
/s/ Steven A. Van Dyke
-----------------------------
STEVEN A. VAN DYKE
/s/ Douglas P. Teitelbaum
-----------------------------
DOUGLAS P. TEITELBAUM
<PAGE>
Exhibit Index
-------------
EXHIBIT I Joint Filing Agreement, by and among Bay Harbour, Tower, Van
---------
Dyke and Teitelbaum.
EXHIBIT II Stockholder and Option Agreement, dated April 12, 1999,
----------
between Sprint Corporation and Bay Harbour Management.
EXHIBIT III Information concerning transactions in Shares of PCTV Common
-----------
Stock effected by the Reporting Persons.
<PAGE>
Exhibit I
Joint Filing Agreement
The undersigned acknowledge and agree that the foregoing statement on
Schedule 13D is filed on behalf of each of the undersigned and that all
subsequent amendments to this statement shall be filed on behalf of each of the
undersigned without the necessity of filing additional joint filing agreements.
The undersigned acknowledge that each shall be responsible for the timely filing
of such amendments, and for the completeness and accuracy of the information
concerning it contained therein, but shall not be responsible for the
completeness and accuracy of the information concerning the others, except to
the extent that it knows or has reason to believe that such information is
inaccurate.
This Agreement may be executed in counterparts and each of such
counterparts taken together shall constitute one and the same instrument.
BAY HARBOUR MANAGEMENT, L.C.
Date: April 22, 1999 By: /s/ Steven A. Van Dyke
-----------------------------
Name: Steven A. Van Dyke
Title: President
TOWER INVESTMENT GROUP, INC.
Date: April 22, 1999 By: /s/ Steven A. Van Dyke
-----------------------------
Name: Steven A. Van Dyke
Title: President
Date: April 22, 1999 /s/ Steven A. Van Dyke
-----------------------------
Steven A. Van Dyke
Date: April 22, 1999 /s/ Douglas P. Teitelbaum
-----------------------------
Douglas P. Teitelbaum
<PAGE>
EXHIBIT II
STOCKHOLDER AND OPTION AGREEMENT
--------------------------------
THIS STOCKHOLDER AND OPTION AGREEMENT (this "Agreement") dated as of April
12, 1999, is entered into between Sprint Corporation, a Kansas corporation
("Sprint"), and Bay Harbour Management, LC, a Florida limited company, for its
managed accounts ("Stockholder"), with respect to the shares of common stock,
par value $.01 per share (the "Company Common Stock"), of People's Choice TV
Corp., a Delaware corporation (the "Company"), owned by Stockholder.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, as of the date hereof, the Stockholder beneficially owns and has
power to vote 881,600 shares of Company Common Stock (including any and all
rights attached thereto to acquire shares of stock of the Company if the Company
adopts a stockholders' rights plan, and any other rights associated therewith,
"Option Shares"); and
WHEREAS, Sprint desires to enter into this Agreement in connection with its
efforts to consummate an acquisition of the Company.
NOW, THEREFORE, in contemplation of the foregoing and in consideration of
the mutual agreements, covenants, representations and warranties contained
herein and intending to be legally bound hereby, the parties hereto agree as
follows:
1. Certain Covenants.
-----------------
1.1 Lock-Up. Stockholder hereby covenants and agrees during the term
-------
of this Agreement that (a) except as consented to in writing by Sprint in its
sole discretion, Stockholder will not sell, transfer, assign, pledge,
hypothecate, tender or otherwise dispose of or limit its right to vote in any
manner any of the Option Shares, or agree to do any of the foregoing, and (b)
Stockholder will not take any action which would have the effect of preventing
or disabling Stockholder from performing its obligations under this Agreement.
1.2 Irrevocable Proxy. Stockholder has revoked or terminated any
-----------------
proxies, voting agreements or similar arrangements previously given or entered
into with respect to the Option Shares and hereby irrevocably appoints Sprint,
during the term of this Agreement, as proxy for Stockholder to vote (or refrain
from voting) in any manner as Sprint, in its sole discretion, may see fit, all
of the Option Shares for Stockholder and in Stockholder's name, place and stead,
at any annual, special or other meeting or action of the stockholders of the
Company, as applicable, or at any adjournment thereof or pursuant to any consent
of the stockholders of the Company, in lieu of a meeting or otherwise, with
respect to any issue brought before the stockholders of the Company, other than
with respect to the election of directors of the Company, for which the
stockholders of the Company are entitled to vote.
<PAGE>
1.3 Public Announcement. Stockholder shall consult with Sprint
-------------------
before issuing any press releases or otherwise making any public statements with
respect to the transactions contemplated herein and shall not issue any such
press release or make any such public statement without the approval of Sprint,
except as may be required by law.
1.4 Stop Transfer Instruction. Promptly following the date hereof,
-------------------------
Stockholder and Sprint shall deliver joint written instructions to the Company
and to the Company's transfer agent stating that the Option Shares disposed may
not be sold, transferred, pledged, assigned, hypothecated, tendered or otherwise
of in any manner without the prior written consent of Sprint or except in
dispersed accordance with the terms and conditions of this Agreement.
1.5 HSR Filing. Promptly following the date hereof, Sprint will make
----------
all filings with and give all notices to governmental or regulatory authorities
required of Sprint pursuant to the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended ("HSR Act"), in connection with consummating the
transactions contemplated by this Agreement. Sprint will use all commercially
reasonable efforts to obtain early termination of all applicable waiting periods
under the HSR Act.
2. Grant of Option.
---------------
2.1 Option. Upon the terms and subject to the conditions of this
------
Agreement, Stockholder hereby grants to Sprint or Sprint's designee an
irrevocable option (the "Option") to purchase the Option Shares. Upon exercise
of the Option and purchase of the Option Shares, Sprint shall not assume any
liabilities or obligations (if any) of Stockholder related to or in connection
with such Option Shares and arising prior to the Option Closing Date (as defined
hereinafter).
2.2 Option Price. The purchase price payable by Sprint or its
------------
designee at the Option Closing (as hereinafter defined) for the Option Shares
shall be an amount equal
to $8.00 per Option Share (the "Option Price"); provided, however, if prior to
-------- -------
the Option Closing, Sprint shall purchase any shares of the Company Common Stock
for an amount per share in excess of the Option Price (the "Excess Amount"),
then the amount per Option Share to be paid by Sprint shall equal the sum of the
Option Price plus the Excess Amount. If following the Option Closing, Sprint
shall purchase any shares of the Company Common Stock for an amount per share in
excess of the sum of the Option Price plus, if applicable, the Excess Amount
plus any other amount previously remitted pursuant to this Section 2.2 (the
"Subsequent Excess Amount"), then Sprint shall forthwith remit to Stockholder an
amount equal to the Subsequent Excess Amount for each Option Share purchased at
the Option Closing. References in this Section 2.2 to the purchase of shares of
Company Common Stock shall include such purchases pursuant to a merger agreement
with the Company.
2.3 Exercise.
--------
(a) Sprint or its designee shall be entitled to exercise the Option by
giving written notice to Stockholder. Such notice shall specify a date (not
earlier than one business day or
-2-
<PAGE>
later than three business days from the date such notice is delivered to
Stockholder) and place for closing of the exercise of the Option (the "Option
Closing"). Upon delivery of notice exercising the Option, the Option shall be
deemed to have been exercised by Sprint or its designee irrespective of the
actual date of the Option Closing (the actual date of the Option Closing is
referred to hereinafter as the "Option Closing Date"). At the Option Closing,
Sprint or its designee will deliver to Stockholder the Option Price (as adjusted
pursuant to Section 2.2, if necessary) with respect to the Option Shares, by
wire transfer of immediately available funds to an account designated in writing
by Stockholder prior to the Option Closing Date.
(b) Upon payment of the Option Price as provided in Section 2.3 hereof, the
Stockholder shall deliver to Sprint or its designee at the Option Closing, (i)
the certificates representing the Option Shares duly endorsed in blank for
transfer, or accompanied by duly executed stock powers in blank, in each case
with signatures guaranteed by a national bank or trust company or a member firm
of the New York Stock Exchange, Inc. and (ii) all such other agreements,
endorsements, assignments and other instruments as are necessary or desirable,
in Sprint's sole and absolute discretion, to vest in Sprint or its designee good
and marketable title to such Option Shares or to evidence of record the sale and
assignment of such Option Shares to Sprint or its designee.
2.4 Option Expiration/Put Right. Except as provided below, the Option
---------------------------
shall terminate and expire ten days after the transactions contemplated by this
Agreement receive approval required by the HSR Act, including early termination
or lapse of the HSR Act waiting period ("HSR Approval"), if the Option has not
been exercised by Sprint or its designee on or before such date (the "Expiration
Date"). If the Option has not been exercised by Sprint on or before the
Expiration Date, Stockholder shall have the right at such time, and for a period
of 30 days thereafter, to deliver a written notice to Sprint (the "Stockholder
Notice") requiring that Sprint or its designee purchase the Option Shares at the
Option Price, as adjusted (if necessary), including payment of any Excess Amount
or Subsequent Excess Amount that would be payable if Sprint exercised the
Option, in accordance with Section 2.2 hereof (the "Put Right"). Upon the
exercise by Stockholder of the Put Right, the parties hereto shall consummate
the purchase and sale of the Option Shares in accordance with Section 2.3
hereof.
3. Representations and Warranties of Stockholder. Stockholder hereby
---------------------------------------------
represents and warrants to Sprint, as of the date hereof and as of the Closing
Date, as follows:
3.1 Ownership. Stockholder has good and marketable title to, and is
---------
the beneficial owner of, the Option Shares, in each case free and clear of all
liabilities, claims, liens, options, proxies, charges, participations and
encumbrances of any kind or character whatsoever. At the Option Closing,
Stockholder, will transfer and convey to Sprint or its designee good and
marketable title to the Option Shares, free and clear of all liabilities,
claims, liens, options, proxies, charges, participations and encumbrances of any
kind or character whatsoever created by or arising through Stockholder.
-3-
<PAGE>
3.2 Authorization. Stockholder has all requisite power and authority
-------------
to execute and deliver this Agreement and to consummate the transactions
contemplated hereby and has sole voting power and sole power of disposition,
with respect to all of the Option Shares owned by Stockholder with no
restrictions on its voting rights or rights of disposition pertaining thereto.
Stockholder has duly executed and delivered this Agreement and this Agreement
is a legal, valid and binding agreement of Stockholder, enforceable against
Stockholder in accordance with its terms.
3.3 Stockholder Has Adequate Information. Stockholder is a
------------------------------------
sophisticated seller with respect to the Option Shares and has adequate
information concerning the business and financial condition of the Company to
make an informed decision regarding the sale of the Option Shares and has
independently and without reliance upon Sprint and based on such information as
Stockholder has deemed appropriate, made its own analysis and decision to enter
into this Agreement. Stockholder acknowledges that Sprint has not made and does
not make any representation or warranty, whether express or implied, of any kind
or character except as expressly set forth in this Agreement. Stockholder
acknowledges that the sale of the Option Shares by Stockholder to Sprint is
irrevocable, and that Stockholder shall have no recourse to the Option Shares or
Sprint, except with respect to breaches of representations, warranties,
covenants and agreements expressly set forth in this Agreement.
3.4 Sprint's Excluded Information. Stockholder acknowledges and
-----------------------------
confirms that (a) Sprint may possess or hereafter come into possession of
certain non-public information concerning the Option Shares and the Company
which is not known to Stockholder and which may be material to Stockholder's
decision to sell the Option Shares ("Sprint's Excluded Information"), (b)
Stockholder has requested not to receive Sprint's Excluded Information and has
determined to sell the Option Shares notwithstanding its lack of knowledge of
Sprint's Excluded Information, and (c) Sprint shall have no liability or
obligation to Stockholder in connection with, and Stockholder hereby waives and
releases Sprint from, any claims which Stockholder or its successors and assigns
may have against Sprint (whether pursuant to applicable Option Shares, laws or
otherwise) with respect to the non-disclosure of Sprint's Excluded Information;
provided, however, nothing contained in this Section 3.4 shall limit
- -------- -------
Stockholder's right to rely upon the express representations and warranties made
by Sprint in this Agreement, or Stockholder's remedies in respect of breaches of
any such representations and warranties.
4. Survival of Representations and Warranties. The respective
------------------------------------------
representations and warranties of Stockholder and Sprint contained herein shall
not be deemed waived or otherwise affected by any investigation made by the
other party hereto, and each representation and warranty contained herein shall
survive the closing of the transactions contemplated hereby until the expiration
of the applicable statute of limitations, including extensions thereof.
5. Specific Performance. Stockholder acknowledges that Sprint will be
--------------------
irreparably harmed and that there will be no adequate remedy at law for a
violation of any of the covenants or agreements of Stockholder which are
contained in this Agreement. It is accordingly agreed that, in addition to any
other remedies which may be available to Sprint upon the breach by Stockholder
of
-4-
<PAGE>
such covenants and agreements, Sprint shall have the right to obtain injunctive
relief to restrain any breach or threatened breach of such covenants or
agreements or otherwise to obtain specific performance of any of such covenants
or agreements.
6. Miscellaneous.
-------------
6.1 Binding Effect. This Agreement shall be binding upon and inure
--------------
to the benefit of and be enforceable by the parties hereto and their respective
representatives and permitted successors and assigns.
6.2 Entire Agreement. This Agreement contains the entire understanding
----------------
of the parties and supersedes all prior agreements and understandings between
the parties with respect to its subject matter. This Agreement may be amended
only by a written instrument duly executed by the parties hereto.
6.3 Headings. The headings contained in this Agreement are for
--------
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Time is of the essence with respect to all
provisions of this Agreement.
6.4 Assignment. This Agreement may not be transferred or assigned by
----------
Stockholder but may be assigned by Sprint to any of its affiliates or to any
successor to its business and will be binding upon and inure to the benefit of
any such affiliate or successor.
6.5 Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be an original, but each of which together
shall constitute one and the same Agreement.
6.6 Notices. All notices, requests, claims, demands and other
-------
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given if so given) by delivery, telegram or telecopy,
or by mail (registered or certified mail, postage prepaid, return receipt
requested) or by any national courier service, provided that any notice
delivered as herein provided shall also be delivered by telecopy at the time of
such delivery. All communications hereunder shall be delivered to the respective
parties at the following addresses (or at such other address for a party as
shall be specified by like notice, provided that notices of a change of address
shall be effective only upon receipt thereof):
(a) If to Sprint: Sprint Corporation
2330 Shawnee Mission Parkway
Westwood, Kansas 66205
Attention: Corporate Secretary
Telecopy: (913) 624-2256
-5-
<PAGE>
with a copy to: King & Spalding
191 Peachtree Street
Atlanta, Georgia 30303-1763
Attention: Bruce N. Hawthorne, Esq.
Telecopy: (404) 572-5146
(b) If to Stockholder: Bay Harbour Management, LC
885 Third Avenue, 34th Floor
New York, NY 10022
Attention: Doug Teitelbaum
Telecopy: (212) 371-7497
with a copy to: Howard Smith & Levin
1330 Avenue of the Americas
New York, NY 10019
Attention: Leonard Chazn
Telecopy: (212) 841-1010
6.7 Equal Treatment of Option Holders. Simultaneously with the
---------------------------------
execution of this Agreement, Sprint is entering into an agreement with the
beneficial owners of not less than 1.2 million shares of the Company Common
Stock, with the terms of such agreement being substantially identical to the
terms of this Agreement.
6.8 Governing Law. This Agreement shall be governed by and construed
-------------
and enforced in accordance with the laws of the State of New York, without
regard to its principles of conflicts of laws.
6.9 Enforceability. The invalidity or unenforceability of any
--------------
provision or provisions of this Agreement shall not affect the validity or
enforceability of any other provision of this Agreement, which shall remain in
full force and effect.
6.10 Further Assurances. From time to time at or after the Option
------------------
Closing, at Sprint's request and without further consideration, Stockholder
shall execute and deliver to Sprint such documents and take such action as
Sprint may reasonably request in order to consummate more effectively the
transactions contemplated hereby and to vest in Sprint good, valid and
marketable title to the Option Shares, including, but not limited to, using its
best efforts to cause the appropriate transfer agent or registrar to transfer of
record the Option Shares.
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<PAGE>
IN WITNESS WHEREOF, Sprint and Stockholder have caused this Agreement to be
duly executed as of the day and year first above written.
SPRINT CORPORATION
By: /s/ Theodore H. Schell
--------------------------
Name: Theodore H. Schell
Title: Sr. Vice President
BAY HARBOUR MANAGEMENT, LC
for its managed accounts
By: /s/ Douglas P. Teitelbaum
-----------------------------
Name: Douglas P. Teitelbaum
Title: Principal and Portfolio Manager
-7-
<PAGE>
Exhibit III
<TABLE>
<CAPTION>
Name of Purchasing Entity Date of Transaction Number of Shares Price Per Share
- ----------------------------- ------------------- ---------------- ---------------
<S> <C> <C> <C>
Bay Harbour Management, L.C. 2/11/99 10,000 $1.51
Bay Harbour Management, L.C. 2/16/99 15,000 $1.49
Bay Harbour Management, L.C. 3/3/99 16,000 $1.22
</TABLE>
