EXHIBIT 3
CHADMOORE WIRELESS GROUP, INC.
0000 Xxxx Xxxxxxx Xxxx, Xxxxx X
Xxx Xxxxx, Xxxxxx 00000
August 21, 2000
Recovery Equity Investors II, L.P.
000 Xxxx Xxxxxxx Xxxxx
Xxxxxxx Xxxx, Xxxxxxxxxx 00000
Re: Agreement and Plan of Reorganization dated as of August 21, 2000 by and
among Nextel Communications, Inc. ("Nextel"), Nextel Asset Acquisition Co.
("Acquisition Sub") and Chadmoore Wireless Group, Inc. ("Chadmoore") (the
"Agreement")
Gentlemen:
Contemporaneously with the execution and delivery of this letter, Nextel,
Acquisition Sub and Chadmoore are entering into the Agreement, pursuant to which
Chadmoore shall transfer to Nextel the Assets (except for the Excluded Assets
specified in the Agreement) in exchange for the Nextel Shares (as adjusted
pursuant to the terms of the Agreement) and the assumption of certain
obligations of Chadmoore. All capitalized terms used but not otherwise defined
herein shall have the meanings assigned to them in the Agreement.
In order to induce Recovery Equity Investors II, L.P., a Delaware limited
partnership ("REI"), to enter into the letter agreement relating to its support
of the Agreement and the Reorganization as required by Nextel under the
Agreement, Chadmoore hereby agrees with REI as follows:
1. Chadmoore shall adopt a plan of liquidation (the "Plan") in
connection with the approval of the Reorganization by the stockholders
of Chadmoore, which Plan shall have been adopted by Chadmoore's Board
of Directors and recommended by such Board for approval by Chadmoore's
stockholders entitled to vote thereon. The Plan shall provide for the
liquidation of Chadmoore and distribution of the Nextel Shares, in
part, as follows:
(A) At a time determined in accordance with the Plan and the
liquidating trust created thereunder, REI shall be entitled to receive,
in exchange for the surrender of all of the shares of Series C
Preferred Stock of Chadmoore then owned by REI and the Warrant,
represented by Certificate No. 3, dated May 1, 1998, issued by
Chadmoore to REI (the "Warrant"), an aggregate number of Nextel Shares
equal to the sum of (x) the number of Nextel Shares that REI would be
entitled to receive under the Plan had it exercised the Warrant in full
(using the portion of the aggregate Stated Value (as defined in the
Certificate of Designation of the Rights, Preferences and Privileges of
the Series C Preferred Stock (the "Certificate of Designation") of all
of the shares of Series C Preferred Stock of Chadmoore then owned by
REI which equals the Aggregate Exercise
Price (as defined in the Warrant)) and received shares of Common
Stock, par value $.001 per share, of Chadmoore upon such exercise and
(y) the number of Nextel Shares reflecting by value (as determined by
reference to the price of the Nextel Shares determined in accordance
with the Plan) the amount equal to (A) the difference between the
aggregate Stated Value of all of the shares of Series C Preferred
Stock of Chadmoore then owned by REI and the portion thereof used to
satisfy the exercise of the Warrant described in (x) above and (B) to
the extent permitted by applicable Colorado law, the amount of all
accrued and unpaid dividends on the Series C Preferred Stock as
provided in the Certificate of Designation through and including the
Closing Date (and Chadmoore shall not declare or pay any dividends on
such shares of Series C Preferred Stock);
(B) Unless otherwise approved by REI with respect to the
treatment of it as a holder of Common Stock, all holders of Common
Stock shall be treated the same under the Plan; and
(C) The form and substance and manner of approval of the Plan
shall conform with all applicable requirements for the Reorganization,
together with the liquidation to be effected under the Plan, to be
treated as a tax-free reorganization under Section 368(a)(1)(C) of the
Code, as determined by Chadmoore=s independent accountants.
2. Following the approval by the shareholders of Chadmoore of the
Reorganization and the Plan, REI shall exercise the Warrant,
represented by Certificate No. 1, dated May 1, 1998, issued by
Chadmoore to REI through the payment of the exercise price in
accordance with the terms thereof.
This Letter Agreement shall be governed by and construed in accordance with the
domestic laws of the State of New York, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of New York or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of New York.
This Letter Agreement may be executed in any number of counterparts, each of
which will be deemed an original, but all of which together will constitute one
and the same instrument.
If you are in agreement with the foregoing, please sign the copy of this letter
enclosed and return it to the undersigned, whereupon it will become a binding
obligation between us.
Sincerely yours,
CHADMOORE WIRELESS GROUP, INC.
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxx X. Xxxxx
Title: President and Chief
Executive Officer
Agreed to and accepted this 21st day of
August, 2000.
RECOVERY EQUITY INVESTORS II, L.P.
By: RECOVERY EQUITY PARTNERS II, L.P.
its General Partner
By: /s/ Xxxxxx X. Xxxx-Xxxx
-------------------------------
Name: Xxxxxx X. Xxxx-Xxxx
Title: General Partner
By: /s/ Xxxxxxx X. Xxxxxx
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Name: Xxxxxxx X. Xxxxxx
Title: General Partner
