<PAGE>

                                                                   EXHIBIT 10.12

January 24, 2000

Mr. Robert Galle
Airadigm Communications, Inc.
2301 Keble Dr.
Little Chute, Wisconsin 54140

Re: Letter of Intent

Dear Bob:

      We recently discussed with you and legal counsel for Airadigm
Communications, Inc. ("Airadigm" or "Debtor"), the acquisition of substantially
all of Airadigm's assets ("Assets") by RW Acquisition LLC, a limited liability
company that is a designated entity (the "Buyer"). AT&T Wireless Services, Inc.
("AWS") will hold a minority, non-attributable interest in Buyer and hereby
agrees to guarantee, as more specifically set forth below, the funding to Buyer
to enable Buyer to perform its obligations as set forth in this letter. This
letter of intent ("LOI") sets forth our agreement concerning the acquisition
(the "Transaction") and will serve as the basis for the preparation of a
definitive agreement. The principal terms of our agreement follow:

1. Structure of Transaction. Airadigm is currently a debtor in possession in In
re Airadigm Communications, Inc., Bkcy. No. 99-33500, in the Bankruptcy Court
for the Western District of Wisconsin at Madison (the "Court"). On Monday,
January 24, 2000, Airadigm will file a plan of reorganization (the "Plan") as
described in more detail below and will seek an Order approving this LOI.
Airadigm will request an expedited hearing date for a hearing as soon as
permitted by the Court but no later than twenty-one days after the filing of the
Plan (the "Hearing Date") to seek Court approval of the terms and conditions of
this LOI.

      1.1 The Reorganization Plan. Pursuant to the Plan, the Buyer will acquire
substantially all assets of Airadigm, including cash and deposits, free and
clear of all liens, claims and encumbrances, and including Airadigm's C-Block
and F-Block PCS Licenses, subject to the assumption by Buyer of the obligations
to the Federal Communications Commission ("FCC") related to the Licenses
(collectively the "Assets") and pursuant to which the Buyer will not assume any
liabilities of Airadigm other than those existing under any executory contracts
or unexpired leases that the Buyer requests in writing that Airadigm assume and
assign to it under the Plan, except as otherwise set forth in the term sheet
attached hereto and made a part hereof (the "Plan Term Sheet") setting forth the
proposed treatment of the various classes of Airadigm's creditors in the Plan.
<PAGE>

      1.2 Binding Nature of This Agreement. Airadigm and Buyer recognize that
they cannot enter into a binding agreement for the sale of the Assets without
the approval of the Court. Airadigm and Buyer covenant and agree that they shall
use all commercially reasonable efforts to obtain Court approval of the terms
and conditions of this LOI, making such non-material modifications as the Court
may require in an effort to preserve the benefit of the bargain intended to be
struck by the parties.

      1.3 Due Diligence. Immediately upon execution of this LOI, Buyer shall
complete its due diligence investigation of Airadigm. Airadigm shall provide
Buyer with the access to information described in Section 6 below. If, as a
result of its due diligence investigation, Buyer is dissatisfied, it shall have
the right to terminate this LOI with no further obligations to Airadigm by
providing written notice pursuant to Section 12 actually received by Airadigm no
later than February 10, 2000.

      1.4 Buyer is Preferred Buyer. Airadigm has already spent considerable time
and effort in marketing its Assets and has concluded in its reasonable business
judgment that the proposal set out herein makes the Buyer the preferred buyer of
substantially all of Airadigm's Assets, on the condition of AWS' guarantee of
funding of Buyer's performance of its obligations to Airadigm under this LOI.

      Commencing upon its execution of the LOI, and continuing until the
consummation of the purchase of the Assets by Buyer or the termination of this
LOI, Airadigm agrees that it will not (and will not permit any of its officers,
directors or controlled affiliates to) solicit any commitments, agreements or
understandings to any person, firm or corporation (other than Buyer) in respect
of any sale or disposition in any manner of the assets or business (or any
material portion thereof) of Airadigm or any transaction which would frustrate
the intent hereof. If Airadigm is contacted by another potential purchaser of a
material portion of its assets or receives any unsolicited proposal (whether
oral or written), Airadigm shall immediately notify Buyer of the substance of
any unsolicited proposal or any discussions and negotiations. Commencing upon
court approval of this LOI, Airadigm may not proceed with any other proposal
unless the Court so directs and unless such proposal is a "qualified offer" and
is subject to the right to match set forth below in Section 1.5.

      1.5 Right to Match. If Airadigm is directed by the Court to proceed with
an unsolicited proposal higher than that of Buyer, then Airadigm shall send a
copy of the offer to Buyer, which shall have a period of five (5) business days
in which to notify Airadigm that Buyer intends to match the higher offer. If
Buyer matches the higher offer, then Airadigm shall accept Buyers higher offer.

      To be a qualified offer, a competing offer to purchase the Assets of
Airadigm must be in writing and received by Airadigm no later than fourteen (14)
days from the date on which the Court approves this LOI, unless the Court
directs that a longer period is required. The offer must match the offer of
Buyer in all respects except price and must exceed the Buyer offer by at least
$2.5 million.


                                       2
<PAGE>

      To make a qualified offer, an offeror must represent and warrant that it
is financially and legally ready to perform if it is the successful offeror,
subject to no conditions other than those to which Buyer is subject, and that,
if it is not the successful offeror, it will not engage in acts or conduct that
will interfere with or disrupt Airadigm's efforts to confirm a plan or obtain an
order incorporating the offer of Buyer.

      To encourage Buyer to make the offer set forth in this letter and to
compensate it for its due diligence and other expenses, Airadigm shall pay Buyer
a breakup fee of $1 Million upon Court approval of Airadigm's acceptance of an
offer from another party to buy all or substantially all the Assets at a time
when Buyer was ready, willing and able to consummate the purchase of Assets
under this LOI. The breakup fee shall be a super-priority administrative claim
with priority above all other claims, except for professional and employee
administrative claims not to exceed $1 million, and shall be payable to Buyer
within twenty (20) business days after Court approval of Airadigm's acceptance
of an offer from a party other than Buyer, unless the Court for good cause sets
a different date of payment or if Airadigm is unable to perform under its
acceptance of the other offer solely due to the FCC's revocation of its C-Block
and F-Block licenses.

2. Purchase Price. The Purchase Price for the Assets (the "Purchase Price") will
be an aggregate of approximately One Hundred Forty Seven Million Dollars
($147,000,000), as set forth on the Plan Term Sheet. The Purchase Price will be
paid by the assumption of certain outstanding debt obligations and the payment
of cash, as follows:

      2.1 Assumption of the outstanding Federal Communications Commission
("FCC") obligation of approximately $74 million plus interest that accrues after
the date hereof (which assumption shall include paying such interest and late
fee in cash as FCC regulations require);

      2.2 Payment of approximately $73 million in cash, to be allocated
substantially in compliance with the allocations made on the Plan Term Sheet.

3. Definitive Agreement. Upon the execution of this LOI, Airadigm and Buyer
shall proceed in good faith to negotiate a definitive agreement (the "Definitive
Agreement") that shall embody the terms set forth herein and containing
customary representations, warranties, covenants, and conditions. The Agreement
shall contain a representation and warranty by Buyer that Buyer is (or will upon
the filing of the FCC application be) fully qualified to be the assignee of
Airadigm's C-block and F-block PCS licenses without the need for waiver of the
FCC's designated entity rules from the FCC. The Agreement shall be conditioned
upon Airadigm's C-Block and F-Block PCS Licenses being in effect and
transferable to Buyer. The conditions to Buyer's obligation to close shall be
limited to the requirement of FCC consent to the assignment of the FCC licenses
to the Buyer, approval of the Court (to the extent not previously obtained) of
the transactions set forth in this LOI, and Hart-Scott-Rodino approval, if
necessary, and those identified in Section 4 below. Although the parties intend
to enter into a definitive agreement containing additional terms and provisions
beyond those contained in this LOI, they acknowledge that this LOI represents
their agreement on all material terms


                                       3
<PAGE>

and intend to be bound hereby (subject to Court approval and approval pursuant
to Section 4.1 below), regardless of whether they ultimately enter into a
definitive agreement.

4. Additional Conditions.

      4.1 AWS shall execute this LOI and the Definitive Agreement to acknowledge
its commitment to guarantee funding to Buyer to enable Buyer to meet its
commitments under this LOI; provided, however, this LOI, and its terms which
shall be embodied in the Definitive Agreement, shall be subject to prior review
and approval by senior management and the Board of Directors (or an appropriate
committee thereof) of AT&T Corp. If such approval is not received by February
17, then Airadigm may terminate this LOI. Airadigm shall be an intended third
party beneficiary of the commitment by AWS to guarantee funding to Buyer set
forth herein with the ability to enforce directly the commitment.

      4.2 Except as approved by Airadigm and Buyer (and, if approved, taken into
account in reduction of the Purchase Price), except for the FCC obligations
related to the PCS C-Block and F-Block licenses, and except as contemplated by
the Plan Term Sheet, the Assets owned by Airadigm shall be free and clear of any
and all liens, claims, encumbrances and rights of third parties.

      4.3 To the extent that Buyer requests Airadigm to assume and assign any
leases, executory contracts, or licenses that are not current as of the Closing,
Buyer shall pay the cost to cure.

      4.4 There shall be no material adverse change in Airadigm's PCS licenses
or business (unless such changes are agreed by Airadigm and Buyer) between the
date of this LOI and the Closing.

      4.5 Orders shall have been entered by the Court, in form and content
reasonably satisfactory to Buyer and Airadigm: (1) approving the LOI, including
its Right to Match, (2) approving the disclosure statement filed in connection
with the Plan, and (3) confirming the Plan

5. Closing. The Closing of the Transaction contemplated by this LOI (the
"Closing") shall take place on the last business day of the month (or, if such
day is the last day of Buyer' fiscal quarter, on the next business day) after
which: (1) the order of the FCC approving the Transaction shall have become
final and non-appealable; (2) the order of any applicable state public utilities
commission approving the Transaction shall have become final and non-appealable;
(3) the Order of the Court confirming the Plan has been entered which has not
been reversed, vacated, or stayed, and (4) all other conditions to closing are
either satisfied or waived by the party entitled to waive such conditions;
provided that either party may terminate the Agreement if Closing has not
occurred within 6 months after the date of the FCC Public Notice of the filing
of the application for consent to the Transaction, unless such failure is due to
a breach of the Agreement by the party seeking to terminate; provided further
that, neither Buyer nor


                                       4
<PAGE>

Airadigm shall have any right to terminate the Agreement until 12 months after
the date of the FCC Public Notice if the delay in Closing is caused by the
absence of requisite FCC approval of the Transaction due to the filing of any
petition with the FCC seeking to deny such approval or seeking reconsideration
of such approval.

6. Access to Information. In connection with the negotiation and preparation of
the Agreement and other related documents, Airadigm will, subject to appropriate
confidentiality and nondisclosure agreements, make available to Buyer all
information relating to Airadigm's PCS systems, and the identity and nature of
the claims of all persons who assert claims against Airadigm, equity interests
in Airadigm, or any right to receive or subscribe to stock of Airadigm, and
Airadigm will provide reasonable access to the management and facilities of
Airadigm so that Buyer may conduct a business and legal due diligence
investigation as to all matters pertaining to Airadigm's business, assets,
liabilities and the Transaction. In the event that the Transaction is not
consummated, all documents and copies provided to Buyer by Airadigm and copies
of any of the foregoing documents made by Buyer shall be returned to Airadigm.

7. Expenses. Except as set forth in Section 1 with regard to the breakup fee,
each party hereto shall bear its own legal and accounting fees and other
expenses (including but not limited to any brokerage expenses) incurred by it in
connection with the transactions contemplated hereby. Buyer will pay all FCC and
other governmental filing fees (including any H-S-R fees) related to the
Transaction. Each party represents that it has not utilized the services of any
broker or agent in connection with the Transaction. Each party hereby
indemnifies and agrees to defend and hold harmless the other party from and
against any claims, actions, liabilities, expenses, and losses relating to any
finders' or brokers' fees of, or other claims by, any finder or broker engaged
or purported to have been engaged by the indemnifying party in connection with
the Transaction.

8. Timing. The terms of this LOI shall expire and be deemed void if: (1) a
signed copy of this letter is not received by Buyer or before 5:00 p.m., PST, on
January 31, 2000; or (2) a Court Order approving this LOI is not entered by
February 17, 2000.

9. Confidentiality. Except for disclosure to the creditors of Airadigm, Airadigm
and Buyer shall keep this proposed Transaction, this LOI, and the terms of this
LOI confidential unless and until Airadigm files a motion with the Court for
approval of this LOI.

10. Governing Law. To the extent that the matters set forth in this LOI are
governed by state law, this LOI shall be governed by and construed in accordance
with the internal laws of the State of New York, without reference to the choice
of law provisions thereof.

11. Counterparts. This LOI may be executed in any number of counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. Facsimile signatures are
acceptable.


                                       5
<PAGE>

12. Notices. Any notices to be given to Airadigm hereunder shall be delivered by
facsimile to

      Mr. Robert Galle, Chief Executive Officer
      Airadigm Communications, Inc.
      (714) 536-4166

      with copies to

      James F. Rogers, Esq.
      (202) 637-2201

      William B. Finkelstein, Esq.
      (214) 939-6100

      Mark Metz, Esq.
      (414) 298-8097

      Leonard Leverson
      (414) 271-8135

      and

      Albert Solochek
      (414) 272-7265

            Any notices to be given to Buyer hereunder shall be delivered by
facsimile to:

      With copies to:

      Kris Cone
      (425) 580-4529

      Joe Shickich, Esq.
      (206) 389-1708

      Tom Sullivan
      703-236-1376

      Alicia Wyman
      617-542-2241


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<PAGE>

            If the foregoing accurately sets forth our understanding, we request
that you evidence your approval by signing the copy of this letter of intent and
returning it to the undersigned.

                                        Sincerely,
                                        RW Acquisition LLC

                                        By:_____________________________________
                                           Its:_________________________________

Accepted and Agreed to this
____ day of _______,2000:

Airadigm Communications, Inc.

By_____________________________
  Its__________________________


AT&T Wireless Services, Inc.

By_____________________________
  Its__________________________


                                       7
<PAGE>

      PLAN TERM SHEET

      A. LIABILITIES TO BE RESTRUCTURED

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------
                                                      Estimated
                                                      ---------
      Classes of Claims             Treatment         Claim Amount    Distributions   Notes
      -----------------             ---------         ------------    -------------   -----
-------------------------------------------------------------------------------------------
<C>   <S>                           <C>                     <C>           <C>         <C>
1.A.  Administrative Claims         Cash                    1,000,000     1,000,000   1
-------------------------------------------------------------------------------------------
1.B.  Administrative Claims         Paid in ordinary
      (Post-petition trade          course of business on     500,000       500,000   2
      payables)                     customary credit
                                    terms
-------------------------------------------------------------------------------------------
2.    Priority claims (primarily    Cash/Deferral
      taxes, wages, etc.)                                     169,000       169,000
-------------------------------------------------------------------------------------------
3.    Secured (DIP Financing)       Assumed                 5,000,000     5,000,000   3
-------------------------------------------------------------------------------------------
4.    Secured Claims
-------------------------------------------------------------------------------------------
4.A.  Ericsson                      Compromised; paid in
                                    cash                   56,875,000    40,000,000   3A
-------------------------------------------------------------------------------------------
4.B.  OEDA                          Compromised; paid in
                                    cash and stock         42,425,000    25,000,000   4
-------------------------------------------------------------------------------------------
4.C.  Wagner real estate            Undecided                 157,500             0   5
-------------------------------------------------------------------------------------------
4.D.  Motor vehicles                Undecided                 162,750             0   5
-------------------------------------------------------------------------------------------
5.    FCC Claim                     Assumed                74,272,011    74,272,011   6
-------------------------------------------------------------------------------------------
6.    Assumed contracts and         Undecided; cure
      equipment leases
-------------------------------------------------------------------------------------------
7.    Assumed real property         Undecided; cure
      leases

-------------------------------------------------------------------------------------------
8.A.  Unsecured claims (trade
      creditor and Wisconsin        Paid in cash           $2,028,000     2,300,000   7
      Wireless claims)
-------------------------------------------------------------------------------------------
8.B.  Unsecured claims (ss.502(g)
      rejection claims              Paid in cash                                      8, 9
-------------------------------------------------------------------------------------------
9.    Existing shareholder/equity   Compromised
-------------------------------------------------------------------------------------------
9.A   Oneida Tribe                  Cancelled 49.9%                             - 0 -
-------------------------------------------------------------------------------------------
9.B.  Wisconsin Wireless            Cancelled 50.1%                             - 0 -
-------------------------------------------------------------------------------------------
                                    TOTAL                $182,589,261   148,241,011
                                    -------------------------------------------------------
</TABLE>

----------
     NOTES: (1)   Includes $100,000 retainer paid to Debtor's counsel and
                  $50,000 paid to Debtor's special counsel.

            (2)   Buyer will advance no more than $500,000 to pay post-petition
                  trade payables, and only after all availability under the DIP
                  Financing facility has been exhausted.

            (3)   Buyer shall pay the DIP Lenders in cash and succeed to rights
                  of lenders under DIP facility.

            (3A)  This includes all claims of Ericsson, whether secured,
                  unsecured or administrative, and whether pre-petition or
                  post-petition.


                                       8
<PAGE>

            (4)   Includes $5 million of AT&T Corp. Common Stock to be delivered
                  upon closing.

            (5)   To be excluded from Assets and will not be conveyed unless
                  purchaser assumes all debt.

            (6)   Plus accrued interest from the date of this LOI.

            (7)   Sum of $1,500,000 is to be shared by holders of allowed
                  unsecured claims on a pro rata basis, excluding holders of
                  ss.502(g) rejection claims whose claims arise as a result of
                  Buyer's direction to Airadigm not to assume the holders'
                  executory contracts or unexpired leases. This class shall
                  include any and all claims by Wisconsin Wireless whether
                  secured, unsecured or administrative, and whether pre-petition
                  or post-petition, but shall exclude claims by Ericsson, Inc.
                  or its related or affiliated companies.

            (8)   Buyer shall pay, in cash, holders of ss.502(g) rejection
                  claims whose claims arise as a result of Buyer's direction to
                  Airadigm not to assume the holders' executory contracts or
                  unexpired leases a percentage of their claims that is the same
                  percentage actually received by holders of allowed unsecured
                  claims who share in the $1.5 million fund under 8.A.

            (9)   Distributions to be made only to holders of allowed claims.
                  Buyer shall be entitled to object to allowance of claims.
                  Airadigm shall have duty to investigate claims and an
                  obligation to object to claims that it reasonably concludes
                  are objectionable in whole or in part.


                                       9
<PAGE>

                         UNITED STATES BANKRUPTCY COURT
                         WESTERN DISTRICT OF WISCONSIN

--------------------------------------------------------------------------------
In re:

      AIRADIGM COMMUNICATIONS, INC.,            Case No. 99-33500
                                                Chapter 11
                        Debtor.

--------------------------------------------------------------------------------

                       ORDER GRANTING MOTION FOR APPROVAL
                          OF TERMS OF LETTER OF INTENT

--------------------------------------------------------------------------------

      On January 27,2000, Airadigm Communications, Inc. (the "Debtor") moved for
approval of the terms of a letter of intent with RW Acquisition LLC, and
requested an expedited hearing on its motion. The Debtor gave notice of its
motion to all creditors and other parties in interest. On February 7, 2000, the
Court conducted a hearing on the Debtor's motion. For cause shown, and upon all
the records, files, and proceedings had herein, it is hereby ORDERED:

      1. The terms of the Letter of Intent (the "LOI") attached as Exhibit A to
the Debtor's motion are approved, except as modified by this order.

      2. Paragraph 8.A. of the Plan Term Sheet attached to the LOI is modified
to provide that the distributions to unsecured creditors, other than holders of
Code ss. 502(g) rejection claims, shall be modified to read "the lesser of
$2,300,000 or the allowed amount of such claims," instead of "$1,500,000.00."
The Committee shall review and object to claims as is appropriate.

      3. The first sentence of the second paragraph of Paragraph 1.5 of the LOI
shall read: "To be a qualified offer, a competing offer to purchase the Assets
of Airadigm must be in writing and received by Airadigm no later than March
1, 2000."
<PAGE>

      4. Paragraph 1.5 of the LOI is further modified to provide that "the
breakup fee shall be a super-priority administrative expense with priority above
all other claims; except for professional, employee, and U.S. Trustee fee
administrative claims, not to exceed $1 million."

      5. Paragraph 1.5 of the LOI is further modified by the addition of the
following words at the end of that paragraph; "or the FCC's refusal to transfer
the licenses, provided the FCC's refusal is not related to matters having to do
with the offeror. In exchange for receipt of the $1 million breakup fee, Buyer
shall represent and warrant that it will not engage in acts or conduct that will
interfere with or disrupt Airadigm's efforts to confirm a plan or obtain an
order incorporating the offer of the offeror. Airadigm shall nor accept an offer
from another party to buy all or substantially all the Assets unless either: (a)
Ericsson Inc. and OEDA consent, or (b) the Court, after notice to Ericsson Inc.,
OEDA, and the Committee, and a hearing determines that Ericsson Inc. and OEDA
are adequately protected as to the DIP Loan and Ericsson Inc.'s first priority
pre-petition secured loan and OEDA's second priority pre-petition secured loan."

      6. The second sentence of Paragraph 4.1 of the LOI shall read as follows:
"If such approval is not received by February 17, then either Buyer or Airadigm
may terminate this LOI."

      7. The approval of the LOI shall not prejudice the rights of, or bind, any
creditor, including but not limited to Ericsson Inc., OEDA and the Committee,
with regard to the distribution or allocation among themselves of the Purchase
Price (as defined in the LOI) pursuant to the LOI, any plan of reorganization,
or otherwise.


                                       2
<PAGE>

      Dated at Madison in the Western District of Wisconsin, this ____ day of
February, 2000.

                                        BY THE COURT:


                                        ________________________________________
                                        The Honorable Robert D. Mania
                                        Chief Bankruptcy Judge

Approved as to form:

ERICSSON INC.                           AIRADIGM COMMUNICATIONS, INC.

By: /s/ William Finkelstein             By: /s/ Leonard G. Leverson
    -----------------------------           ------------------------------------
    William Finkelstein                     Leonard G. Leverson
    Roy Prange


ONEIDA ENTERPRISE DEVELOPMENT           UNITED STATES OF AMERICA
AUTHORITY

By: /s/ Mark Metz                       By: /s/ Peter Miller
    -----------------------------           ------------------------------------
    Mark Metz                               Peter Miller


OFFICIAL UNSECURED CREDITORS'           RW ACQUISITION LLC
COMMITTEE

By: /s/ Albert Solochek                 By: /s/ Joseph Shickich, Jr.
    -----------------------------           ------------------------------------
    Albert Solochek                         Joseph Shickich, Jr.


                                       3