This excerpt taken from the ATNI DEF 14A filed Apr 18, 2006.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In March 2000, Wireless World (now operating as Choice Communications) acquired the assets and business of Antilles Wireless for consideration of 606,060 shares of common stock of the Company and $1.5 million in cash. The Chairman of the Company, who is the father of the Companys President and Chief Executive Officer, owned the entire equity interest in Antilles Wireless. In accordance with certain provisions of the purchase agreement, the Chairman of the Board was required, effective December 31, 2004, to return approximately $858,000, including accrued interest to the Company, as the financial performance of Antilles Wireless fell below expected levels specified in the agreement. Payment was made in March 2005 in the form of shares, (64,650) of the Companys common stock. The Company recorded the repayment as an equity contribution as of December 31, 2004.
During the period March through June 2001, the Company acquired a significant minority interest in LighTrade for $5,000,000. The Companys Chief Executive Officer, who is also the son of the Chairman of the Board of the Company, was an officer of LighTrade, and over a year prior to the Companys investment the Chairman had personally invested $100,000 in LighTrade. The decision to invest in LighTrade was made by a unanimous vote of the Companys directors after disclosure of the above facts, which were not a factor in the boards decision to make the investment. In July 2001, the Chairman made an unsecured loan of $500,000 to LighTrade, and the Company made secured loans to LighTrade of $250,000 in August 2001 and $320,000 in January 2002. These loans enabled LighTrade to secure a $5,000,000 equity investment by an unaffiliated investor. In December 2004, the Company deemed the loans to be uncollectible and wrote them off.
This excerpt taken from the ATNI DEF 14A filed Apr 13, 2005.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In March 2000 the Company bought from the Chairman of the Board and Chief Executive Officer of the Company (the Chairman) certain licenses and a company called Antilles Wireless Cable T.V. (Antilles Wireless). The Company was represented by its outside directors, who hired independent counsel and Corporate Valuation Advisory, Inc. to advise them. One of the provisions of the sale contract was that the Chairman would reimburse the Company up to $1.5 million if certain licensed business activities of Antilles Wireless did not generate gross profits of $6 million cumulatively in calendar years 2000, 2001 and 2002. At the end of 2002 the Chairman would have owed the Company approximately $1.2 million pursuant to this provision. The contract also provided that the Chairman pledge the 242,424 shares of the Company which constituted part of the consideration paid by the Company for Antilles Wireless as security for his obligations under the contract.
The independent directors of the Company, after consulting independent counsel and corporate counsel, by a majority vote decided to extend the time period for measuring the cumulative gross profits of the specified businesses through 2004, to increase the target profit to $6.5 million and to extend the period of the aforementioned pledge. The primary reason for this amendment was the view of the majority of the independent directors that the intention of establishing a period for reimbursement was to confirm the fair value of Antilles
Wireless and that unforeseen circumstances made the 2000 to 2002 period an unfair measuring period. The unforeseen circumstances included siting problems, technical problems on the conversion to digital technology, and additional business acquisitions approved by the Board of Directors which were combined with Antilles Wireless and impeded development of the licensed activities. The amendment also continued the provision which allows the Chairman to earn an additional payment if gross profits during the five year period exceed a specified amount, which amount was increased from $12 million to $13 million.
In accordance with the purchase agreement, as amended, the Chairman of the Board was required, effective December 31, 2004, to return approximately $865,000, including accrued interest, to the Company as the financial performance of Antilles Wireless fell below the levels specified in the agreement. Payment was made in March 2005 in the form of shares of the Companys Common Stock, as approved by the Companys independent directors. The Company recorded the repayment as an equity contribution as of December 31, 2004.
This excerpt taken from the ATNI 10-K filed Mar 31, 2005.