CALDERWOOD & HARKNESS LLP 375 Park Avenue, 40th Floor New York, NY 10152 Telephone: (212) 554-7000 Facsimile: (212) 554-7001
September 22, 2022
SIDE LETTER RE: CONSENT OF CRESTWOOD FAMILY OFFICE LLC TO ASSET PURCHASE AGREEMENT
Northgate Wireless Americas Inc. 2200 Wilson Boulevard, Suite 1450 Arlington, VA 22201
Attention: Claire Matsuda, VP, U.S. Operations
Ridgeline Wireless Holdings LLC 450 South Virginia Street, Suite 800 Reno, NV 89501
Attention: Garrett Nolan, Managing Member, and Diane Chua, Co-Managing Member & COO
Ladies and Gentlemen:
Reference is made to that certain Asset Purchase Agreement, dated as of September 22, 2022 (as the same may be amended, restated, supplemented, or otherwise modified from time to time, the "APA"), by and between Ridgeline Wireless Holdings LLC, a Nevada limited liability company (NV Secretary of State Entity No. E0428716302) ("Seller" or "Ridgeline"), and Northgate Wireless Americas Inc., a Delaware corporation (Delaware Secretary of State File No. 7284619) ("Buyer" or "Northgate"), pursuant to which Seller has agreed to assign, convey, transfer, and deliver to Buyer, and Buyer has agreed to acquire and accept from Seller, fourteen (14) Federal Communications Commission ("FCC") Wireless Radio Service licenses operating in the Meridian Technologies-3 / Band 66 spectrum block (call signs WQAB201, WQAB202, WQAB203, WQAB204, WQAB205, WQAB206, WQAB207, WQAB208, WQAB209, WQAB210, WQAB211, WQAB212, WQAB213, and WQAB214) (collectively, the "Licenses"), covering certain geographic service areas in portions of the State of Nevada, eastern California, and southern Oregon, for an aggregate purchase price of One Hundred Twenty-Six Million Five Hundred Thousand Dollars ($126,500,000) (the "Purchase Price"), subject to the terms and conditions set forth therein. Capitalized terms used but not defined herein shall have the meanings ascribed to them in the APA, unless the context otherwise requires.
Ridgeline Wireless Holdings LLC is governed by that certain Amended and Restated Limited Liability Company Agreement of Ridgeline Wireless Holdings LLC, dated as of March 14, 2019 (as the same may have been amended, restated, supplemented, or otherwise modified from time to time prior to the date hereof, the "LLC Agreement"), among the following members: Garrett Nolan, holding a sixty-two percent (62%) membership interest; Diane Chua, holding an eighteen percent (18%) membership interest; Pinnacle Growth Capital Fund II LP, holding a twelve percent (12%) membership interest; and Crestwood Family Office LLC, holding an eight percent (8%) membership interest. Together, such members hold one hundred percent (100%) of the outstanding membership interests in Ridgeline.
Crestwood Family Office LLC, a Nevada limited liability company with its principal office located at 9850 Double R Boulevard, Suite 200, Reno, NV 89521 ("Crestwood"), holds an eight percent (8%) passive membership interest in Ridgeline. Crestwood's membership interest in Ridgeline is a passive, non-managing interest, and Crestwood does not serve as a manager, managing member, or officer of Ridgeline.
The LLC Agreement requires the prior written consent of members holding membership interests equal to or in excess of certain specified thresholds (as more particularly set forth in Article VII, Section 7.03 of the LLC Agreement) to approve any transfer, sale, assignment, conveyance, or other disposition of material assets of Ridgeline, including any FCC spectrum licenses held by Ridgeline, and/or any change-of-control transaction, merger, consolidation, or similar business combination affecting all or substantially all of Ridgeline's assets. The transactions contemplated by the APA, including the assignment and transfer of all fourteen (14) Licenses from Ridgeline to Northgate, constitute a transfer or sale of material assets of Ridgeline requiring such consent under the LLC Agreement.
This side letter (this "Side Letter") is being executed and delivered by Crestwood to evidence Crestwood's irrevocable consent to the transactions contemplated by the APA, including, without limitation, the assignment and transfer of the fourteen (14) FCC Wireless Radio Service licenses (call signs WQAB201 through WQAB214) from Ridgeline to Northgate Wireless Americas Inc., and to satisfy in full the applicable consent requirements under the LLC Agreement with respect to Crestwood's eight percent (8%) membership interest in Ridgeline.
NOW, THEREFORE, in consideration of the foregoing recitals (which are hereby incorporated into and made a part of this Side Letter), and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned parties agree as follows:
1. Consent.
Crestwood Family Office LLC hereby irrevocably and unconditionally consents to the following:
(a) the execution, delivery, and performance by Ridgeline Wireless Holdings LLC of the APA, including all schedules, exhibits, annexes, and ancillary documents and agreements contemplated thereby or executed in connection therewith;
(b) the assignment, conveyance, transfer, and delivery of the fourteen (14) FCC Wireless Radio Service licenses (Meridian Technologies-3 / Band 66, call signs WQAB201 through WQAB214, inclusive) from Ridgeline to Northgate Wireless Americas Inc. as contemplated by and in accordance with the terms and conditions of the APA;
(c) the preparation, filing, and prosecution of FCC Form 603 (Application for Assignment of Authorization) and any and all related regulatory filings, applications, notifications, petitions, or submissions with the Federal Communications Commission, including, without limitation, any petition for declaratory ruling pursuant to Section 310(b)(4) of the Communications Act of 1934, as amended, and the FCC's rules and regulations promulgated thereunder, in each case in connection with or as may be required to consummate the transactions contemplated by the APA; and
(d) the taking of all other actions by Ridgeline and its managers, members, officers, agents, representatives, and advisors as may be reasonably necessary, appropriate, or desirable to consummate the transactions contemplated by the APA, including the execution and delivery of all documents, instruments, certificates, and agreements required to be delivered by Ridgeline at or prior to the closing of the transactions contemplated by the APA.
This consent is given by Crestwood pursuant to, and in satisfaction of the requirements of, Article VII, Section 7.03 of the LLC Agreement, and constitutes Crestwood's consent thereunder with respect to Crestwood's eight percent (8%) membership interest in Ridgeline. This consent, once given, is irrevocable and may not be withdrawn, revoked, or modified by Crestwood.
2. Representations and Warranties of Crestwood.
Crestwood Family Office LLC hereby represents and warrants to Ridgeline and to Northgate as follows, as of the date hereof:
(a) Organization and Authority. Crestwood Family Office LLC is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Nevada. Crestwood has full limited liability company power and authority to execute and deliver this Side Letter and to perform its obligations hereunder. The execution, delivery, and performance of this Side Letter have been duly and validly authorized by all necessary limited liability company action on the part of Crestwood, including, to the extent required, the approval of Crestwood's members and/or managers.
(b) Authorization. The execution, delivery, and performance of this Side Letter by Crestwood have been duly authorized by all necessary action on the part of Crestwood, and no further consent, approval, authorization, order, filing, registration, or qualification of or with any court, governmental authority, or third party is required in connection with the execution, delivery, and performance by Crestwood of this Side Letter or the consummation of the transactions contemplated hereby.
(c) Binding Effect. This Side Letter constitutes a legal, valid, and binding obligation of Crestwood, enforceable against Crestwood in accordance with its terms, subject to (i) applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium, receivership, and similar laws affecting creditors' rights and remedies generally and (ii) general principles of equity, including principles of commercial reasonableness, good faith, and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity).
(d) No Conflicts. The execution, delivery, and performance of this Side Letter by Crestwood does not and will not: (i) violate, conflict with, or result in a breach of any provision of the articles of organization, operating agreement, or other organizational or governing documents of Crestwood; (ii) violate, conflict with, or result in a violation of any law, statute, regulation, rule, ordinance, order, judgment, injunction, decree, or other legal requirement applicable to Crestwood or any of its assets or properties; or (iii) conflict with, result in a breach or violation of, constitute a default (or an event that, with notice or lapse of time or both, would constitute a default) under, give rise to a right of termination, cancellation, acceleration, or modification of, or require any consent under, any contract, agreement, indenture, mortgage, lease, license, instrument, note, or other arrangement to which Crestwood is a party or by which Crestwood or any of its assets or properties may be bound or affected.
(e) Membership Interest. Crestwood holds an eight percent (8%) membership interest in Ridgeline Wireless Holdings LLC, free and clear of all liens, pledges, charges, claims, security interests, mortgages, hypothecations, encumbrances, restrictions, and adverse claims of any kind or nature whatsoever (collectively, "Liens"), other than restrictions on transfer arising under the LLC Agreement and applicable federal and state securities laws. Crestwood has not assigned, transferred, conveyed, pledged, hypothecated, encumbered, or otherwise disposed of any portion of such membership interest or any right, title, or interest therein. Crestwood is the sole beneficial and record owner of such membership interest.
3. Acknowledgments.
Crestwood Family Office LLC hereby acknowledges each of the following:
(a) Crestwood has received a complete copy of the APA, together with all schedules and exhibits thereto, and has had a reasonable and adequate opportunity to review and consider the terms and conditions thereof, including with the assistance of Crestwood's own legal and financial advisors;
(b) the aggregate purchase price payable by Northgate to Ridgeline under the APA for the Licenses is One Hundred Twenty-Six Million Five Hundred Thousand Dollars ($126,500,000), subject to such adjustments as may be provided in the APA;
(c) the transactions contemplated by the APA involve the assignment and transfer of FCC licenses and are subject to the prior approval of the Federal Communications Commission, and the closing of the transactions contemplated by the APA is conditioned upon, among other things, the receipt of such FCC approval;
(d) this Side Letter is being delivered as a condition to, or in connection with, the closing of the transactions contemplated by the APA, and constitutes a material inducement for Northgate and Ridgeline to enter into the APA and to consummate the transactions contemplated thereby; and
(e) both Northgate Wireless Americas Inc. and Ridgeline Wireless Holdings LLC are relying on the consent granted herein and the representations and warranties of Crestwood contained herein, and such consent and representations and warranties are a material consideration for Northgate's and Ridgeline's willingness to proceed with the transactions contemplated by the APA.
4. Scope of Consent; No Amendment to LLC Agreement.
This Side Letter constitutes Crestwood's consent solely and exclusively for purposes of the transactions contemplated by the APA, including the specific assignment and transfer of the fourteen (14) FCC Wireless Radio Service licenses (call signs WQAB201 through WQAB214) from Ridgeline to Northgate as described herein, and shall not be deemed to constitute a consent to any other transaction, agreement, arrangement, or course of dealing, or a waiver, release, or modification of any rights, remedies, or obligations that Crestwood may have under the LLC Agreement, at law, or in equity, with respect to any future transaction or matter.
Nothing in this Side Letter shall be deemed to amend, modify, supplement, restate, waive, or otherwise alter any provision of the LLC Agreement, and the LLC Agreement shall remain in full force and effect in accordance with its terms, except to the extent that the consummation of the transactions contemplated by the APA may affect the rights and obligations of the members thereunder in the ordinary course.
5. No Consideration; Passive Member Status.
Crestwood acknowledges and confirms that it is providing the consent set forth in Section 1 of this Side Letter in its capacity as a passive member of Ridgeline holding an eight percent (8%) membership interest. No separate consideration, payment, fee, or other compensation is being paid or provided to Crestwood by Ridgeline, Northgate, or any other person in exchange for, or as an inducement for, Crestwood's execution and delivery of this Side Letter or the granting of the consent contained herein, other than Crestwood's existing rights (if any) under the LLC Agreement with respect to distributions, allocations, or other payments arising from or attributable to the proceeds of the transaction contemplated by the APA, as and to the extent provided by the LLC Agreement.
6. Notices.
All notices, requests, demands, consents, waivers, and other communications under or in connection with this Side Letter shall be in writing and shall be deemed to have been duly given (a) when delivered personally, (b) when sent by electronic mail (with confirmation of receipt), (c) one (1) business day after deposit with a nationally recognized overnight courier service (with proof of delivery), or (d) three (3) business days after being mailed by certified or registered mail, return receipt requested, postage prepaid, in each case addressed as follows (or to such other address as a party may designate by written notice to the other parties in accordance with this Section 6):
If to Crestwood:
Crestwood Family Office LLC 9850 Double R Boulevard, Suite 200 Reno, NV 89521
Attention: Eleanor Crestwood, Principal
If to Ridgeline:
Ridgeline Wireless Holdings LLC 450 South Virginia Street, Suite 800 Reno, NV 89501
Attention: Garrett Nolan, Managing Member
with a copy (which shall not constitute notice) to:
Hargrove, Sato & Caldwell LLP 100 West Liberty Street, Suite 1200 Reno, NV 89501
Attention: Kevin Sato
If to Buyer:
Northgate Wireless Americas Inc. 2200 Wilson Boulevard, Suite 1450 Arlington, VA 22201
Attention: Claire Matsuda, VP, U.S. Operations
with a copy (which shall not constitute notice) to:
Calderwood & Harkness LLP 375 Park Avenue, 40th Floor New York, NY 10152
Attention: Sylvia Hartwell
7. Governing Law.
This Side Letter shall be governed by, and construed and enforced in accordance with, the laws of the State of Nevada, without giving effect to any choice-of-law or conflict-of-law rules, provisions, or principles (whether of the State of Nevada or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Nevada. The parties acknowledge and agree that the selection of Nevada law is consistent with the law governing Ridgeline's formation and the LLC Agreement.
8. Counterparts; Electronic Delivery.
This Side Letter may be executed in one or more counterparts (including by means of telecopied, facsimile, or portable document format (PDF) signature pages), each of which shall be deemed an original and all of which, taken together, shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Side Letter by electronic mail transmission (including by PDF, Brightwater Software, or other electronic signature platform) or by facsimile shall be effective as delivery of a manually executed counterpart of this Side Letter.
9. Miscellaneous.
(a) Entire Agreement. This Side Letter, together with the APA, the LLC Agreement, and the other transaction documents executed and delivered in connection therewith, constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes all prior negotiations, representations, understandings, and agreements (whether written or oral) among the parties relating to such subject matter.
(b) Severability. If any provision of this Side Letter is held to be invalid, illegal, or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision of this Side Letter or any other jurisdiction, and this Side Letter shall be reformed, construed, and enforced in such jurisdiction as if such invalid, illegal, or unenforceable provision had never been contained herein, so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party.
(c) Amendments. No amendment, modification, supplement, or waiver of any provision of this Side Letter, and no consent to any departure by any party from the terms hereof, shall be effective unless the same shall be in writing and signed by the party or parties against whom enforcement of such amendment, modification, supplement, waiver, or consent is sought. No waiver of any provision hereof shall be deemed to be or shall constitute a continuing waiver of such provision or a waiver of any other provision, and no failure or delay in exercising any right, power, or privilege under this Side Letter shall operate as a waiver thereof.
(d) Third-Party Beneficiaries. Northgate Wireless Americas Inc. is an intended third-party beneficiary of this Side Letter and shall be entitled to enforce the consent granted in Section 1 and the representations and warranties set forth in Section 2 as if Northgate were a direct party hereto. Except as expressly provided in the foregoing sentence, nothing in this Side Letter, express or implied, is intended to or shall confer upon any person other than the parties hereto and their respective successors and permitted assigns any right, benefit, or remedy of any nature whatsoever under or by reason of this Side Letter.
[Signature Pages Follow]
SIGNATURE PAGE TO SIDE LETTER RE: CONSENT OF CRESTWOOD FAMILY OFFICE LLC TO ASSET PURCHASE AGREEMENT
IN WITNESS WHEREOF, the undersigned has executed this Side Letter as of the date first written above.
CRESTWOOD FAMILY OFFICE LLC
By: ________
Name: Eleanor Crestwood
Title: Principal
Date: September 22, 2022
ACKNOWLEDGED AND AGREED
The undersigned hereby acknowledge and agree to the terms of this Side Letter as of the date first written above.
RIDGELINE WIRELESS HOLDINGS LLC
By: ________
Name: Garrett Nolan
Title: Managing Member
Date: September 22, 2022
NORTHGATE WIRELESS AMERICAS INC.
By: ________
Name: Claire Matsuda
Title: VP, U.S. Operations
Date: September 22, 2022
Drafted by Calderwood & Harkness LLP