MMDS Ops CAI, Heartland Fight for Lives


Although it has received approval from a Delaware
bankruptcy court regarding its reorganization plan, not everyone is optimistic that CAI
Wireless Systems Inc. will be able to get back on its feet.

According to the reorganization plan, holders of CAI's
12.25 percent senior notes, due 2002, will receive $16.4 million in cash and $100 million
in newly issued bonds, which will be due in 2004. Those bondholders will also receive 91
percent of the stock in a newly organized company.

Secured lenders, which are owed about $52 million, will be
paid in full, the reorganization plan stated. But stockholders in the wireless cable
operator, which is traded on the over-the-counter bulletin board, will receive nothing for
their investments.

Although CAI is optimistic that it will be able to recover,
at least one former investor believes that the reorganization is merely prolonging the

"I think it's too late," said Gerald
Nordberg, president of Nordberg Capital Inc., a New York-based investment banker and a
former investor in CAI. "All of these wireless companies are on the rocks. I think
the world has passed them by."

James Ashman, CAI's chief financial officer, did not
return phone calls seeking comment.

John Mansell, a wireless analyst for Paul Kagan Associates
Inc. in Carmel, Calif., was more optimistic about CAI's future because the company
controls several attractive markets, and it could do well supplying two-way high-speed
Internet services. However, much like with other wireless cable companies, finding capital
remains a problem.

"Even though they have emerged from bankruptcy court
and they have a cleaner balance sheet, is there anybody out there to lend them the capital
that they need to make two-way wireless happen?" he asked.

And while CAI is leaving bankruptcy court, another large
wireless cable TV provider is preparing to go in.

Heartland Wireless Communications Inc. of Dallas said last
week that it will file a pre-negotiated Chapter 11 reorganization plan on or before Nov.

The company, which has 166,000 subscribers in 57 markets,
said it had reached agreement with its bondholders to convert $323 million in debt -- $240
million in senior notes, $26 million in accrued interest and $57 million in subordinated
notes -- into common stock.

According to the plan, holders of the company's 13
percent senior notes, due 2003; its 14 percent senior notes, due 2004; and its 9 percent
convertible subordinated discount notes, due 2004, will receive 97 percent of the stock in
the newly organized company.