-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IfskuJnU5aPSFDefvGJDZ+nPC3pmHBVzSrptq1eUit3EhYNJdtWrzkUlH1le+z4u fUTUKatdKJX7fZSh65Er8w== 0001086844-00-000007.txt : 20000411 0001086844-00-000007.hdr.sgml : 20000411 ACCESSION NUMBER: 0001086844-00-000007 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20000410 EFFECTIVENESS DATE: 20000410 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AIRGATE PCS INC /DE/ CENTRAL INDEX KEY: 0001086844 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE COMMUNICATIONS (NO RADIO TELEPHONE) [4813] IRS NUMBER: 582422929 STATE OF INCORPORATION: DE FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: S-8 SEC ACT: SEC FILE NUMBER: 333-34416 FILM NUMBER: 596744 BUSINESS ADDRESS: STREET 1: 233 PEACHTREE ST NE STREET 2: SUITE 1700 CITY: ATLANTA STATE: GA ZIP: 30303 BUSINESS PHONE: 4045257272 MAIL ADDRESS: STREET 1: 233 PEACHTREE ST STREET 2: SUITE 1700 CITY: ATLANTA STATE: GA ZIP: 30303 S-8 1 FORM S-8 As filed with the Securities and Exchange Commission on April 10, 2000. File No. 333-______ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ________________________________ FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 AirGate PCS, Inc. ----------------- (Exact Name of Issuer as Specified in its Charter) Delaware 58-2422929 ----------- ----------- (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification Number) Harris Tower, Suite 1700 233 Peachtree Street, N.E. Atlanta, GA 30303 (404) 525-7272 (Address, including zip code, and telephone number of Principal Executive Offices) AIRGATE PCS, INC. 1999 STOCK OPTION PLAN (Full Title of the Plan) THOMAS M. DOUGHERTY President and Chief Executive Officer AirGate PCS, Inc. Harris Tower, Suite 1700 233 Peachtree Street,N.E. Atlanta, GA 30303 (404) 525-7272 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copy to: LAURA G. THATCHER Alston & Bird LLP One Atlantic Center 1201 West Peachtree Street, NW Atlanta, Georgia 30309-3424 (404) 881-7546 _______________________ CALCULATION OF REGISTRATION FEE Proposed Proposed Title of Securities Amount to Maximum Maximum Amount of to be Registered be Registered Offering Price Aggregate Registration (1) Per Unit Offering Price Fee Common Stock $0.01 par value 1,100,000 (2) $14.00 (2) $15,400,000 (2) $4,065.60 per share Common Stock $0.01 par value 55,000 (3) $43.625 (3) $ 2,399,375 (3) $633.43 per share Common Stock $0.01 par value 20,000 (4) $2.00 (4) $40,000 (4) $10.56 per share Common Stock $0.01 par value 83,000 (5) $42.75 (5) $ 3,548,250 (5) $936.74 per share Common Stock $0.01 par value 80,000 (6) $65.125 (6) $5,210,000 (6) $1,375.44 per share Common Stock $0.01 par value 25,000 (7) $98.50 (7) $2,462,500 (7) $650.10 per share Common Stock $0.01 par value 637,000 (8) $87.625 (8) $55,817,125 (8) $14,735.72 per share
(1) There are 2,000,000 shares currently reserved or available for issuance as options pursuant to the AirGate PCS, Inc. 1999 Stock Option Plan (the "Plan"). The number of shares being registered includes an indeterminate number of additional shares which may be necessary to adjust the number of shares reserved for issuance pursuant to the Plan as the result of a stock split, stock dividend or similar adjustment of the outstanding Common Stock of AirGate PCS, Inc. pursuant to 17 C.F.R. section 230.416(a). (2) Options for 1,100,000 shares have been granted under the Plan at an exercise price of $14.00 per share. (3) Options for 55,000 shares have been granted under the Plan at an exercise price of $43.625 per share. (4) Options for 20,000 shares have been granted under the Plan at an exercise price of $2.00 per share. (5) Options for 83,000 shares have been granted under the Plan at an exercise price of $42.75 per share. (6) Options for 80,000 shares have been granted under the Plan at an exercise price of $65.125 per share (7) Options for 25,000 shares have been granted under the Plan at an exercise price of $98.50 per share. (8) Pursuant to Rule 457(h), the maximum offering price per share for the remaining 637,000 options which have not been granted is based on the market value of the common stock on April 4, 2000, as determined by the average of the high and low prices quoted on the Nasdaq National Market as reported in the Wall Street Journal which was $87.625 per share. II-1 PART I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS (a) The documents constituting Part I of this Registration Statement will be sent or given to participants in the Plan as specified by Rule 428(b)(1) under the Securities Act of 1933, as amended. (b) Upon written or oral request, the Registrant will provide, without charge, the documents incorporated by reference in Item 3 of Part II of this Registration Statement. The documents are incorporated by reference in the Section 10(a) prospectus. The Registrant will also provide, without charge, upon written or oral request, other documents required to be delivered to employees pursuant to Rule 428(b). Requests for the above mentioned information, should be directed to Shelley L. Spencer, Corporate Secretary, at (301) 540-6222. PART II. INFORMATION REQUIRED IN REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference The following documents have been filed by AirGate PCS, Inc. (the "Registrant") with the Securities and Exchange Commission (the "Commission") pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and are deemed to be a part hereof from the date of the filing of such documents: (1) The Registrant's Transition Report on Form 10-K for the period December 31, 1998 to September 30, 1999; (2) The Registrant's Quarterly Report on Form 10-Q for the quarter ended December 31, 1999; (3) All other reports filed by the Registrant pursuant to Section 13(a) or 15(d) of the Exchange Act since September 30, 1999; (4) The description of Registrant's Common Stock contained in Registrant's Form 8-A (File No. 0-27455), as filed with the SEC pursuant to Section 12(g) of the Exchange Act and Rule 12b-15 promulgated thereunder, on September 24, 1999; and (5) All other documents subsequently filed by the Registrant pursuant to Section 13(a), 13(c), 14 and 15(d) of the Exchange Act prior to the filing of a post-effective amendment to this Registration Statement that indicates that all securities offered have been sold or that deregisters all securities that remain unsold. Any statement contained in a document incorporated or deemed incorporated herein by reference shall be deemed to be modified or superseded for the purpose of this Registration Statement to the extent that a statement contained herein or in any subsequently filed document which also is, or is deemed to be, incorporated herein by reference modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this II-2 Item 4. Description of Securities. The common stock to be offered pursuant to the Plan has been registered pursuant to Section 12 of the Exchange Act. Accordingly, a description of the common stock is not required herein. Item 5. Interests of Named Experts and Counsel. Not Applicable. The validity of the Common Stock offered hereby has been passed upon by Alston & Bird LLP, Atlanta, Georgia, for the Registrant. Item 6. Indemnification of Directors and Officers In accordance with General Corporation Law of the State of Delaware (being chapter 1 of Title 8 of the Delaware code), the Registrant's Certificate of Incorporation provides as follows: The Registrant shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Registrant to procure a judgment in its favor by reason of the fact that such person acted in any of the capacities set forth above, against expenses (including attorney's fees) actually and reasonably incurred by him in connection with the defense or settlement of such action or suit if such person acted under similar standards, eceives a written undertaking by or on behalf of the director or officer to repay such amount if it is ultimately determined that that such person is not entitled to be indemnified by the Registrant. To the extent that a director or officer of the Registrant has been successful in the defense of any action, suit or proceeding referred to above or in the defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorney's fees) actually and reasonably incurred by him or her in connection therewith, that indemnification provided for by the Certificate of Incorporation shall not be deemed exclusive of any other rights to which the indemnified party may be e t is empowered to purchase and maintain insurance on behalf of a director or officer of the Registrant against any liability asserted against him or her in any such capacity, or arising out of such person's status as such, whether or not the Registrant would have the power to indemnify him against such liabilities under the Certificate of Incorporation. In addition to indemnification provided to the Registrant's officers and directors in the Certificate of Incorporation and under the laws of Delaware, the Registrant has entered into indemnification agreements with certain officers and directors to provide further assurances and protection from liability that they may incur in their respective positions and duties in connection with the public offering or as a fiduciary of the Registrant and its shareholders. The Registrant has agreed to indemnify and hold ted under Delaware law, each person and affiliated person (generally, any director, officer, employee, controlling person, agent, or fiduciary of the indemnified person), provided that the indemnified person was acting or serving at the Registrant's request in his capacity as either an officer, director, employee, controlling person, fiduciary or other agent or affiliate of the Registrant Under the indemnification agreements, each person is indemnified against any and all losses, claims, damages, expenses al, (including attorney's fees, expenses and amount in settlement) that occur in connection with any threatened, pending or completed action, suit, proceeding, alternative dispute resolution mechanism or hearing, inquiry or investigation that such indemnified person believes in good faith may lead to the institution of such action, under the Securities Act of 1933, Securities Exchange Act of 1934 or other federal or state statutory law or regulation, at common law or otherwise, which relate directly or ind ation, purchase, sale or ownership of any securities of the Registrant or to any fiduciary obligation owed with respect to the Registrant and its stockholders. As a condition to receiving indemnification, indemnified persons are required to give notice in writing of any claim for which indemnification may be sought under such agreement. II-3 The agreement provides that an indemnified person may receive indemnification against (1) expenses (including attorney's fees and other costs, expenses and obligations incurred), judgements, fines and penalties; (2) amounts paid in settlement (approved by the Registrant); (3) federal, state, local taxes imposed as a result of receipt of any payments under the indemnification agreement; and (4) all interest, assessments and other charges paid or payable in connection with any expenses, costs of settlement or will be indemnified against expenses to the extent that he is successful on the merits or otherwise, including dismissal of an action without prejudice, in defense of any action, suit, proceeding, inquiry or investigation. Expenses that the indemnified person have or will incur in connection with a suit or other proceeding may be received in advance within 10 days of written demand to the Registrant. Prior to receiving indemnification of being advanced expenses, a committee, consisting or either members of the board of directors or any person appointed by the board of directors, must make a determination of whether the indemnified person is entitled to indemnification under Delaware law. If there is a change in control (as defined in the indemnification agreement) that occurs without majority approval of the board of directors, then the committee will consist of independent legal counsel selected by th ed by the Registrant to render a written opinion as to whether and the extent of indemnification that the indemnified person is entitled, which will be binding on the Registrant Under the indemnification agreement, an indemnified person may appeal a determination by the committee's determination not to grant indemnification or advance expenses by commencing a legal proceeding. Failure of the committee to make a indemnification determination or the termination of any claim by judgement, order, settlement, viction does not create a presumption that either (1) the indemnified person did not meet a particular standard of conduct or belief or (2) that the court has determined that indemnification is not available. Under the indemnification agreement, an indemnified person is entitled to contribution from the Registrant for losses, claims, damages, expenses or liabilities as well as other equitable considerations upon the determination of a court of competent jurisdiction that indemnification is not available. The amount contributed by the Registrant will be in proportion, as appropriate, to reflect the relative benefits received by the Registrant and the indemnified person or, if such contribution is not permitted u ative benefit will be considered with the relative fault of both parties. In connection with the registration of AirGate, PCS, Inc.'s securities, the relative benefits received by the Registrant and indemnified person will be deemed to be in the same respective proportions of the net proceeds from the offering (less expenses) received by the Registrant and the indemnified person. The relative fault of the Registrant and the indemnified person is determined by reference to whether the untrue or alleged unt t or omission or alleged omission to state a material fact relates to information supplied by the Registrant or the indemnified person and their relative intent, knowledge, access to information and opportunity to correct such statement or omission. Contribution paid takes into account the equitable considerations, if any, instead of a pro rata or per capital allocation. In connection with the offering of the Registrant securities, an indemnified person will not be required to contribute any amount in excess of the lessor of (1) the proportion of the total of such losses, claims, damages, or liabilities indemnified against equal to the proportion of the total securities sold under the registration statement sold by the indemnified person or (2) the pr ied person from the sale of securities under the registration statement. Contribution will not be available if such person is found guilty of fraudulent misrepresentation, as defined in the agreement. II-4 In the event that the Registrant is also obligated under a claim and upon written notice to the indemnified person, the Registrant is entitled to assume defense of the claim and select counsel which is approved by the indemnified person. Upon receipt of the indemnified person's approval, the Registrant will directly incur the legal expenses and as a result will have the right to conduct the defense as it sees fit in its sole discretion, including the right to settle any claim against any indemnified party ified person. Item 7. Exemption from Registration Claimed. Not Applicable. Item 8. Exhibits Exhibit Number Description 4.1 Amended and Restated Certificate of Incorporation of the Registrant (incorporated by reference from Exhibit 3.1 to the Registration Statement on Form S-1/A, filed by the Registrant with the Commission on June 15, 1999 (SEC File Nos. 333-79189-02 and 333-79189-01). 4.2 Amended and Restated By-laws of the Registrant (incorporated by reference from Exhibit 3.2 to the Registration Statement on Form S-1/A, filed by the Registrant with the Commission on June 15, 1999 (SEC File Nos. 333-79189-02 and 333-79189-01). 4.3 Specimen certificate representing the Common Stock (incorporated by reference from Exhibit 4.1 to the Registration Statement on Form S-1/A, filed by the Registrant with the Commission on June 15, 1999 (SEC File Nos. 333-79189-02 and 333-79189-01). 5.1 Opinion of Counsel 23.1 Consent of Counsel (included in Exhibit 5) 23.2 Consent of KPMG LLP 24.1 Power of Attorney (included on signature page) 99.1 AirGate PCS, Inc. 1999 Stock Option Plan Item 9. Undertakings (a) The undersigned Company hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: II-5 (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of this Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in this Registration Statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement; Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) above do not apply if the Registration Statement is on Form S-3, Form S-8 or Form F-3, and the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed by the Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities being offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned Company hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (signatures on following page) II-6 SIGNATURES The Registrant. Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Atlanta, State of Georgia, on April 7, 2000. AirGate PCS, Inc. By: /s/ Thomas M. Dougherty ------------------------ Thomas M. Dougherty President and Chief Executive Officer POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Thomas M. Dougherty as his true and lawful attorneys-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments (including post-effective amendments) to this Registration Statement, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of the, or their or his substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated as of April 7, 2000. Name Title Date /s/ Thomas M. Dougherty President, Chief Executive Officer and April 7, 2000 - ----------------------- Director (Principal Executive Officer) Thomas M. Dougherty /s/ Alan B. Catherall Chief Financial Officer (Principal April 7, 2000 - ----------------------- Financial and Accounting Officer) Alan B. Catherall /s/ W. Chris Blane Vice President of Business Development April 7, 2000 - ----------------------- and Director W. Chris Blane II-7 /s/ Thomas D. Body, III Vice President of Strategic Development April 7, 2000 - ----------------------- and Director Thomas D. Body, III /s/ Barry Schiffman Chairman of the Board of Directors April 7, 2000 - ----------------------- Barry Schiffman /s/ Gill Cogan Director April 7, 2000 - ----------------------- Gill Cogan _______________________ Director Robert Ferchat /s/ John R. Dillon Director April 7, 2000 - ----------------------- John R. Dillon EXHIBIT INDEX TO REGISTRATION STATEMENT ON FORM S-8 Exhibit Number Description - -------- ------------ 4.1 Amended and Restated Certificate of Incorporation of the Registrant (incorporated by reference from Exhibit 3.1 to the Registration Statement on Form S-1/A, filed by the Registrant with the Commission on June 15, 1999 (SEC File Nos. 333-79189-02 and 333-79189-01). 4.2 Amended and Restated By-laws of the Registrant (incorporated by reference from Exhibit 3.2 to the Registration Statement on Form S-1/A, filed by the Registrant with the Commission on June 15, 1999 (SEC File Nos. 333-79189-02 and 333-79189-01). 4.3 Specimen certificate representing the Common Stock (incorporated by reference from Exhibit 4.1 to the Registration Statement on Form S-1/A, filed by the Registrant with the Commission on June 15, 1999 (SEC File Nos. 333-79189-02 and 333-79189-01). 5.1 Opinion of Counsel 23.1 Consent of Counsel (included in Exhibit 5) 23.2 Consent of KPMG LLP 24.1 Power of Attorney (included on signature page) 99.1 AirGate PCS, Inc. 1999 Stock Option Plan
EX-5.1 2 OPINION OF COUNSEL Exhibit 5.1 Opinion of Alston & Bird LLP ALSTON&BIRD LLP One Atlantic Center 1201 West Peachtree Street Atlanta, Georgia 30309-3424 404-881-7000 Fax: 404-881-7777 Telex: 54-2996 April 7, 2000 AirGate PCS, Inc. Harris Tower, Suite 1700 233 Peachtree Street, NE Atlanta, Georgia 30303 Re: Form S-8 Registration Statement -- AirGate PCS, Inc. 1999 Stock Option Plan Ladies and Gentlemen: We have acted as counsel to AirGate PCS, Inc., a Delaware corporation (the "Corporation"), in connection with the filing of the above-referenced Registration Statement on Form S-8 (the "Registration Statement") with the Securities and Exchange Commission (the "Commission") to register under the Securities Act of 1933, as amended (the "Securities Act"), 2,000,000 shares of the Corporation's common stock, $0.01 par value per share ("Common Stock"), that may be issued pursuant to the AirGate PCS, Inc. 1999 Stock Option Plan (the "Plan"). This opinion letter is rendered pursuant to Item 8 of Form S-8 and Item 601(b)(5) of the Commission's Regulation S-K. We have examined the Plan, the Amended and Restated Certificate of Incorporation of the Corporation, the Amended and Restated Bylaws of the Corporation, records of proceedings of the Board of Directors of the Corporation deemed by us to be relevant to this opinion letter, the Registration Statement and other documents and agreements we deemed necessary for purposes of expressing the opinion set forth herein. We also have made such further legal and factual examinations and investigations as we deemed necessary for purposes of expressing the opinion set forth herein. As to certain factual matters relevant to this opinion letter, we have relied upon certificates and statements of officers of the Corporation and certificates of public officials. Except to the extent expressly set forth herein, we have made no independent investigations with regard thereto, and, accordingly, we do not express any opinion as to matters that might have been disclosed by independent verification. This opinion letter is provided to the Corporation and the Commission for their use solely in connection with the transactions contemplated by the Registration Statement and may not be used, circulated, quoted or otherwise relied upon by any other person or for any other purpose without our express written consent. The only opinion rendered by us consists of those matters set forth in the sixth paragraph hereof, and no opinion may be implied or inferred beyond those expressly stated. Our opinion set forth below is limited to the General Corporation Law of the State of Delaware, applicable provisions of the Constitution of the State of Delaware and reported judicial decisions interpreting such General Corporation Law and Constitution, and we do not express any opinion herein concerning any other laws. Based on the foregoing, it is our opinion that the 2,000,000 shares of Common Stock covered by the Registration Statement and to be issued pursuant to the Plan, when issued in accordance with the terms and conditions of the Plan, will be legally and validly issued, fully paid and nonassessable. We consent to the filing of this opinion letter as an exhibit to the Registration Statement and to the use of our name wherever appearing in the Registration Statement. In giving such consent, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder. Sincerely, ALSTON & BIRD LLP By: /s/ Laura G. Thatcher ----------------------- Laura G. Thatcher, Partner EX-23.2 3 CONSENT OF KPMG LLP Exhibit 23.2 Consent of KPMG LLP INDEPENDENT ACCOUNTANTS' CONSENT The Board of Directors AirGate PCS, Inc.: We consent to the incorporation by reference in this Registration Statement on Form S-8 of AirGate PCS, Inc. of our report dated November 19, 1999, relating to the consolidated balance sheets of AirGate PCS, Inc. and subsidiary and predecessors as of September 30, 1999 and December 31, 1998, and the related consolidated statements of operations, stockholders' equity (deficit), and cash flows for the nine month periods ended September 30, 1999 and 1998, the years ended December 31, 1998 and 1997 and for the period from inception, June 15, 1995, to September 30, 1999, which report appears in the September 30, 1999, annual report on Form 10-K of AirGate PCS, Inc. /s/ KPMG LLP Atlanta, Georgia April 7, 2000 EX-99.1 4 EXHIBIT 99.1 AIRGATE PCS, INC. 1999 STOCK OPTION PLAN 1. Purpose of the Plan. The purposes of this Stock Option Plan are to attract and retain the best available personnel for positions of substantial responsibility, to provide additional incentive to such individuals, to reward such individuals for exemplary service and to promote the success of the Company's business by aligning employee financial interests with long-term shareholder value. Options granted hereunder may be either Incentive Stock Options or Nonqualified Stock Options, at the discretion of the Board and as reflected in the terms of the written option agreement. 2. Definitions. As used herein, the following definitions shall apply: (a) "Board" shall mean the Committee, if the Committee has been appointed, or the Board of Directors of the Company, if the Committee has not been appointed. (b) "Code" shall mean the Internal Revenue Code of 1986, as amended. (c) "Committee" shall mean the Compensation Committee appointed by the Board of Directors in accordance with Section 4(a) of the Plan, if one is appointed. (d) "Common Shares" shall mean the $.01 par value per share common capital stock of the Company. (e) "Company" shall mean AIRGATE PCS, INC., a Delaware corporation, and any successor thereto. (f) "Continuous Status as an Employee" shall mean the absence of any interruption or termination of service as an Employee. Continuous Status as an Employee shall continue to the extent provided in a written severance or employment agreement during any period for which severance compensation payments are made to an Employee and shall not be considered interrupted in the case of any leave of absence authorized in writing by the Company prior to its commencement. (g) "Employee" shall mean any person, including officers and directors, employed by the Company or any Parent or Subsidiary of the Company. Notwithstanding the foregoing, for purposes of any Incentive Stock Option granted hereunder, "Employee" includes only employees within the meaning of Section 422 of the Code. (h) "Incentive Stock Option" shall mean any option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code. (i) "Non-Employee Director" shall have the same meaning as defined or interpreted for purposes of Rule 16b-3 (including amendments and successor provisions) as promulgated by the Securities and Exchange Commission pursuant to its authority under the Securities Exchange Act of 1934, as amended ("Rule 16b-3"). (j) "Nonqualified Stock Option" shall mean an option not intended to qualify as an Incentive Stock Option. (k) "Option" shall mean a stock option granted pursuant to the Plan and represented by a written option agreement. (l) "Optioned Shares" shall mean the Common Shares subject to an Option. (m) "Optionee" shall mean an Employee who receives an Option. (n) "Outside Director" shall have the same meaning as defined or interpreted for purposes of Section 162(m) of the Code. (o) "Parent" shall mean a "parent corporation" whether now or hereafter existing, as defined in Section 424(e) of the Code. (p) "Plan" shall mean this 1999 Stock Option Plan, including any amendments hereto. (q) "Share" shall mean one Common Share, as adjusted in accordance with Section 11 of the Plan. (r) "Subsidiary" shall mean (i) in the case of an Incentive Stock Option, a "subsidiary corporation," whether now or hereafter existing, as defined in Section 424(f) of the Code, and (ii) in the case of a Nonqualified Stock Option, in addition to a subsidiary corporation as defined in (i), a limited liability company, partnership or other entity in which the Company controls fifty percent (50%) or more of the voting power or equity interests. 3. Shares Subject to the Plan. Subject to the provisions of Section 11 of the Plan, the maximum aggregate number of shares which may be optioned and sold under the Plan is 2,000,000 Common Shares. The Shares may be authorized, but unissued, or reacquired Common Shares. If an Option should expire or become unexercisable for any reason without having been exercised in full, the unpurchased Shares which were subject thereto shall, unless the Plan shall have been terminated, become available for future grant under the Plan. 4. Administration of the Plan. (a) Procedure. The Plan shall be administered by the Board of Directors of the Company. (i) The Board of Directors may appoint a Compensation Committee consisting of not less than two members of the Board of Directors to administer the Plan on behalf of the Board of Directors, subject to such terms and conditions as the Board of Directors may prescribe. Once appointed, the Committee shall continue to serve until otherwise directed by the Board of Directors. (ii) Any grants of Options to officers, directors and shareholders who are subject to Section 16 of the Securities Exchange Act of 1934, as amended (the "Exchange Act') shall be made by (A) a Committee of two or more directors, each of whom is a Non-Employee Director and an Outside Director or (B) as otherwise permitted by Rule 16b-3, Section 162(m) of the Code and other applicable laws, rules and regulations. (iii) From time to time the Board of Directors may increase the size of the Committee and appoint additional members thereof, remove members (with or without cause) and appoint new members in substitution therefor, or fill vacancies however caused. (b) Powers of the Board. Subject to the provisions of the Plan, the Board shall have the authority, in its discretion (i) to grant Incentive Stock Options or Nonqualified Stock Options; (ii) to determine, in accordance with Section 8(b) of the Plan, the fair market value of the Shares; (iii) to determine, in accordance with Section 8(a) of the Plan, the exercise price per Share of Options to be granted; (iv) to determine the Employees to whom, and the time or times at which, Options shall be granted and the number of Shares to be represented by each Option; (v) to interpret the Plan; (vi) to prescribe, amend, and rescind rules and regulations relating to the Plan; (vii) to determine the terms and provisions of each Option granted (which need not be identical and may include, as conditions to exercise (as well as, in the case of Nonqualified Stock Options, conditions to grant), vesting, forfeiture, performance criteria, noncompete and such other restrictions, provisions and conditions as the Board may determine) and, with the consent of the holder thereof, modify or amend each Option; (viii) to reduce the exercise price per share of outstanding and unexercised Options; (ix) to accelerate or defer (with the consent of the Optionee) the exercise date of any Option; (x) to authorize any person to execute on behalf of the Company any instrument required to effectuate the grant of an Option previously granted by the Board; and (xi) to make all other determinations deemed necessary or advisable for the administration of the Plan. (c) Effect of Board's Decision. All decisions, determinations, and interpretations of the Board shall be final and binding on all Optionees and any other holders of any Options granted under the Plan. 5. Eligibility. (a) Options may be granted only to Employees. (b) Each Option shall be designated in the written option agreement as either an Incentive Stock Option or a Nonqualified Stock Option. However, notwithstanding such designations, to the extent that the aggregate fair market value of the stock with respect to which options designated as Incentive Stock Options are exercisable for the first time by any Optionee during any calendar year (under all plans of the Company and any Parent or Subsidiary of the Company) exceeds $100,000, such options shall be treated as Nonqualified Stock Options. (c) For purposes of Section 5(b), options shall be taken into account in the order in which they were granted, and the fair market value of stock shall be determined as of the time the option with respect to such stock is granted. (d) Nothing in the Plan or any Option granted hereunder shall confer upon any Optionee any right with respect to continuation of employment with the Company, nor shall it interfere in any way with the Optionee's right or the Company's right to terminate the employment relationship at any time, with or without cause. 6. Term of Plan. The Plan shall become effective upon its adoption by the Board. It shall continue in effect until December 31, 2009, unless sooner terminated under Section 14 of the Plan. 7. Term of Option. The term of each Option shall be no more than ten (10) years from the date of grant. However, in the case of an Incentive Stock Option granted to an Optionee who, at the time the Option is granted, owns Shares representing more than ten percent (10%) of the voting power of all classes of shares of the Company or any Parent or Subsidiary, the term of the Option shall be no more than five (5) years from the date of grant. 8. Exercise Price and Consideration. (a) The per Share exercise price under each Option shall be such price as is determined by the Board, subject to the following: (i) In the case of an Incentive Stock Option: (A) granted to an Employee who, at the time of the grant of the Incentive Stock Option, owns shares representing more than ten percent (10%) of the voting power of all classes of shares of the Company or any Parent or Subsidiary, the per Share exercise price shall be no less than one hundred ten percent (110%) of the fair market value per Share on the date of grant. (B) granted to any other Employee, the per Share exercise price shall be no less than one hundred percent (100%) of the fair market value per Share on the date of grant. (ii) In the case of a Nonqualified Stock Option, the per Share exercise price may be less than, equal to, or greater than the fair market value per Share on the date of grant, as determined by the Board in its discretion. (b) The fair market value per Share shall be determined by the Board in its discretion and, in the case of an Incentive Stock Option, in accordance with Section 422 of the Code. (c) The consideration to be paid for the Shares to be issued upon exercise of an Option, including the method of payment, shall be determined by the Board at the time of grant and may consist, without limitation, of cash and/or check and/or promissory note. In all cases, an Optionee (including, without limitation, an officer, director or shareholder of the Company who is subject to Section 16 of the Exchange Act) may in addition be allowed to pay all or part of the purchase price with Shares. Shares used to pay the exercise price shall be valued at their fair market value on the exercise date. (d) Prior to issuance of the Shares upon exercise of an Option, the Optionee shall pay any federal, state, and local withholding obligations of the Company, if applicable. An Optionee (including, without limitation, an officer, director or shareholder of the Company who is subject to Section 16 of the Exchange Act) may elect to pay such withholding tax obligations by having the Company withhold Shares having a value equal to the amount required to be withheld. The value of the Shares to be withheld shall equal the fair market value of the Shares on the day the option is exercised. The right of an officer, director or shareholder who is subject to Section 16 of the Exchange Act to dispose of Shares to the Company in satisfaction of withholding tax obligations shall be deemed to be approved as part of the initial grant of an Option, unless thereafter rescinded, and shall otherwise be made in compliance with Rule 16b-3 and other applicable regulations. 9. Exercise of Option. (a) Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable at such times and under such conditions as determined by the Board at the time of grant, and as shall not violate the terms of the Plan. An Option may not be exercised for a fraction of a Share. An Option shall be deemed to be exercised when written notice of such exercise has been given to the Company in accordance with the terms of the Option by the person entitled to exercise the Option and full payment for the Shares with respect to which the Option is exercised has been received by the Company. Full payment may, as authorized by the Board, consist of any consideration and method of payment allowable under Section 8(c) of the Plan. Until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company) of the share certificate evidencing such Shares, no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Shares, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such share certificate promptly upon exercise of the Option. In the event that the exercise of an Option is treated in part as the exercise of an Incentive Stock Option and in part as the exercise of a Nonqualified Stock Option pursuant to Section 5(b), the Company shall issue a share certificate evidencing the Shares treated as acquired upon the exercise of an Incentive Stock Option and a separate share certificate evidencing the Shares treated as acquired upon the exercise of a Nonqualified Stock Option, and shall identify each such certificate accordingly in its share transfer records. No adjustment will be made for a dividend or other right for which the record date is prior to the date the share certificate is issued, except as provided in Section 11 of the Plan. Exercise of an Option in any manner shall result in a decrease in the number of Shares which thereafter may be available, both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised. (b) Termination of Status as Employee. In the event of termination of an Optionee's Continuous Status as an Employee, such Optionee may exercise Options to the extent exercisable on the date of termination. In the case of an Incentive Stock Option and unless specified otherwise in the Option Agreement in the case of a Nonqualified Stock Option, such exercise must occur within three (3) months (or such shorter time as may be specified in the grant) after the date of such termination (but in no event later than the date of expiration of the term of such Option as set forth in the Option Agreement). To the extent that the Optionee was not entitled to exercise the Option at the date of termination, or does not exercise the Option within the time specified herein or therein (whichever first occurs), the Option shall terminate. If the Optionee returns to Continuous Status as an Employee before his deadline for exercise pursuant to this Section 9(b), then Optionee shall be restored to the status as Optionee he held immediately prior to his termination (provided no employment credit will be earned for any period he was not in Continuous Status as an Employee). (c) Disability of Optionee. Notwithstanding the provisions of Section 9(b) above, in the event of termination of an Optionee's Continuous Status as an Employee as a result of total and permanent disability (i.e., the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of twelve (12) months), the Optionee may exercise the Option, but only to the extent of the right to exercise that had accrued as of the date of termination. In the case of an Incentive Stock Option and unless specified otherwise in the Option Agreement in the case of a Nonqualified Stock Option, such exercise must occur within twelve (12) months (or such shorter time as is specified in the grant) from the date on which the Employee ceased working as a result of the total and permanent disability (but in no event later than the date of expiration of the term of such Option as set forth in the Option Agreement). To the extent that the Optionee was not entitled to exercise such Option within the time specified herein or therein (whichever first occurs), the Option shall terminate. If the Optionee returns to Continuous Status as an Employee before his deadline for exercise pursuant to this Section 9(c), then Optionee shall be restored to the status as Optionee he held immediately prior to his termination (provided no employment credit will be earned for any period he was not in Continuous Status as an Employee). (d) Death of Optionee. Notwithstanding the provisions of Section 9(b) above, in the event of the death of an Optionee -- (i) who is at the time of death an Employee, the Option may be exercised, at any time within six (6) months following the date of death (but in no event later than the date of expiration of the term of such Option as set forth in the Option Agreement), by the Optionee's estate or by a person who acquired the right to exercise the option by bequest or inheritance, but only to the extent of the right to exercise that had accrued as of the date of death; or (ii) whose Option has not yet expired but whose Continuous Status as an Employee terminated prior to the date of death, the Option may be exercised, at any time within six (6) months following the date of death (but in no event later than the date of expiration of the term of such Option as set forth in the Option Agreement), by the Optionee's estate or by a person who acquired the right to exercise the option by bequest or inheritance, but only to the extent of the right to exercise that had accrued at the date of termination. (e) Notwithstanding subsections (b), (c), and (d) above, the Board shall have the authority to extend the expiration date of any outstanding option in circumstances in which it deems such action to be appropriate (provided that no such extension shall extend the term of an Option beyond the date on which the Option would have expired if no termination of the Employee's Continuous Status as an Employee had occurred). 10. Non-Transferability of Options. An Option may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Optionee, only by the Optionee; provided, however, that the Board may permit further transferability, on a general or specific basis, and may impose conditions and limitations on any permitted transferability. 11. Adjustments Upon Changes in Capitalization or Merger. Subject to any required action by the shareholders of the Company, the number of Shares covered by each outstanding Option, and the number of Shares which have been authorized for issuance under the Plan but as to which no Options have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Option, as well as the price per Share covered by each such outstanding Option, shall be proportionately adjusted for any increase or decrease in the number of issued Shares resulting from a stock split, reverse stock split, stock dividend, combination, or reclassification of the Shares, or any other increase or decrease in the number of issued Shares effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been "effected without receipt of consideration." Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding, and conclusive. Except as expressly provided herein, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares subject to an Option. In the event of the proposed dissolution or liquidation of the Company, the Option will terminate immediately prior to the consummation of such proposed action, unless otherwise provided by the Board. The Board may, in the exercise of its sole discretion in such instances, declare that any Option shall terminate as of a date fixed by the Board and give each Optionee the right to exercise an Option as to all or any part of the Optioned Shares, including Shares as to which the Option would not otherwise be exercisable. In the event of a proposed sale of all or substantially all of the assets of the Company, or the merger of the Company with or into another corporation, each Option shall be assumed or an equivalent option shall be substituted by such successor corporation or a parent or subsidiary of such successor corporation, unless such successor corporation does not agree to assume the Option or to substitute an equivalent Option, in which case the Board shall, to the extent required by law or otherwise as determined by the Board, in lieu of such assumption or substitution, provide for the Optionee to have the right to exercise the Option as to all of the Optioned Shares, including Shares as to which the Option would not otherwise be exercisable. If the Board makes an Option fully exercisable in lieu of assumption or substitution in the event of a merger or sale of assets, the Board shall notify the Optionee that the Option shall be fully exercisable for a period of thirty (30) days from the date of such notice, and the Option will terminate upon the expiration of such period. 12. Time of Granting Options. The date of grant of an Option shall, for all purposes, be the date on which the Company completes the corporate action relating to the grant of an Option and all conditions to the grant have been satisfied, provided that conditions to the exercise of an Option shall not defer the date of grant. Notice of a grant shall be given to each Employee to whom an Option is so granted within a reasonable time after the determination has been made. 13. Substitutions and Assumptions. The Board shall have the right to substitute or assume Options in connection with mergers, reorganizations, separations, or other transactions to which Section 424(a) of the Code applies, provided such substitutions and assumptions are permitted by Section 424 of the Code and the regulations promulgated thereunder. The number of Shares reserved pursuant to Section 3 may be increased by the corresponding number of Options assumed and, in the case of a substitution, by the net increase in the number of Shares subject to Options before and after the substitution. 14. Amendment and Termination of the Plan. The Board may amend or terminate the Plan from time to time in such respects as the Board may deem advisable (including, but not limited to, amendments which the Board deems appropriate to enhance the Company's ability to claim deductions related to stock option exercises); provided, however, that any increase in the number of Shares subject to the Plan, other than in connection with an adjustment under Section 11 of the Plan, shall require approval of or ratification by the shareholders of the Company. (a) Employees in Foreign Countries. The Board shall have the authority to adopt such modifications, procedures, and subplans as may be necessary or desirable to comply with provisions of the laws of foreign countries in which the Company or its Parent or Subsidiaries may operate to assure the viability of the benefits from Options granted to Employees employed in such countries and to meet the objectives of the Plan. (b) Effect of Amendment or Termination. Any such amendment or termination of the Plan shall not affect Options already granted and such Options shall remain in full force and effect as if this Plan had not been amended or terminated, unless mutually agreed otherwise between the Optionee and the Board, which agreement may be in writing and signed by the Optionee and the Company. 15. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant to the exercise of an Option unless the exercise of such Option and the issuance and delivery of such Shares pursuant thereto shall comply with all relevant provisions of law, including, without limitation, the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, any applicable state securities laws, and the requirements of any stock exchange upon which the Shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance. 16. Reservation of Shares. The Company, during the term of this Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan. 17. Shareholder and Board Approval. The Plan, is subject to approval by the shareholders and Board of the Company and shall become effective on the date of such approval. 18. Governing Law. The validity, construction, interpretation and effect of this Plan shall exclusively be governed by and determined in accordance with the laws of the State of Georgia, except to the extent preempted by federal law.
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