FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): September 17, 1999
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Aerial Communications, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 0-28262 39-1706857
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
8410 West Bryn Mawr, Suite 1100, Chicago, Illinois 60631
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (773) 399-4200
Not Applicable
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(Former name or former address, if changed since last report)
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Item 5. Other Events.
On September 20, 1999, Aerial Communications, Inc. ("Aerial")
announced that its Board of Directors unanimously approved a definitive
agreement to merge with VoiceStream Wireless Corporations ("VoiceStream",
NASDAQ: VSTR). VoiceStream and Aerial will enter into a merger in which
VoiceStream will exchange 0.455 shares of VoiceStream common stock for each of
Aerial's Common Shares and Series A Common Shares. Aerial public shareholders
will have a right to elect to receive $18 in cash in lieu of shares of
VoiceStream.
This Current Report on Form 8-K is being filed for the purpose of
filing the Aerial news release dated September 20, 1999 and various documents
related to the merger as exhibits.
Item 7. Financial Statements and Exhibits
( c) Exhibits
The exhibits accompanying this report are listed in the accompanying
Exhibit Index.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereto duly authorized.
Date: September 28, 1999 AERIAL COMMUNICATIONS, INC.
(Registrant)
By: /s/ J. Clarke Smith
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J. Clarke Smith
Vice President - Finance and Administration,
Chief Financial Officer and Treasurer
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EXHIBIT INDEX
Exhibit Number Description of Exhibit
99.1 Aerial news release dated September 20,1999.
99.2 Agreement and Plan of Reorganization dated
September 17, 1999 among VoiceStream
Wireless Corporation, VoiceStream Wireless
Holding Corporation, VoiceStream Subsidiary
III Corporation, Aerial Communications, Inc.
and Telephone and Data Systems, Inc. is
incorporated herein by reference to the
Telephone and Data Systems, Inc. Form 8-K
dated September 17, 1999.
99.3 Stockholder Agreement dated as of September
17, 1999 by and between Telephone an Data
Systems, Inc. and stockholder of Aerial
Communications, Inc., and VoiceStream
Wireless Corporation, and VoiceStream
Wireless Holding Corporation is incorporated
herein by reference to the Telephone and
Data Systems, Inc. Form 8-K dated September
17, 1999.
99.4 Indemnity Agreement dated as of September
17, 1999, among VoiceStream Wireless
Corporation, VoiceStream Wireless Holding
Corporation, Aerial Communications, Inc.,
Aerial Operating Company, Inc., and
Telephone and Data Systems, Inc. is
incorporated herein by reference to the
Telephone and Data Systems, Inc. Form 8-K
dated September 17, 1999.
99.5 Debt/Equity Replacement Agreement dated as
of September 17, 1999 made by and among
Telephone and Data Systems, Inc., Aerial
Communications, Inc., Aerial Operating
Company, Inc., VoiceStream Wireless
Corporation, and VoiceStream Wireless
Holding Corporation is incorporated herein
by reference to the Telephone and Data
Systems, Inc. Form 8-K dated September 17,
1999.
99.6 Parent Stockholder Agreement dated as of
September 17, 1999 by and among Aerial
Communications, Inc., Telephone and Data
Systems, Inc., VoiceStream Wireless
Corporation, VoiceStream Wireless Holding
Corporation and the individuals and entities
set forth on Schedule I is incorporated
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herein by reference to the Telephone and
Data Systems, Inc. Form 8-K dated September
17, 1999.
99.7 Settlement Agreement and Release is entered
into as of the 17th day of September 1999 by
and among Sonera Ltd., Sonera Corporation
U.S., Telephone and Data Systems, Inc.,
Aerial Communications, Inc., and Aerial
Operating Company, Inc. is incorporated
herein by reference to the Telephone and
Data Systems, Inc. Form 8-K dated September
17, 1999. This agreement is joined by
VoiceStream Wireless Corporation and
VoiceStream Wireless Holding Corporation.
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EXHIBIT 99.1
JOINT NEWS RELEASE
FOR IMMEDIATE RELEASE
Contacts: VoiceStream Wireless Aerial Communications
Ken Prussing Clarke Smith
(425) 586-8072 (773) 399-4367
ken.prussing @voicestream.com [email protected]
Telephone & Data Systems
Mark Steinkraus
(312) 630-1900
[email protected]
Aerial Communications to merge with VoiceStream Wireless
Aerial shareholders to receive 0.455 VoiceStream shares
Sonera Invests $500 million into VoiceStream
September 20, 1999 - Bellevue, Washington - Chicago, Illinois - VoiceStream
Wireless Corporation [NASDAQ: VSTR] and Aerial Communications, Inc. [NASDAQ:
AERL] today announced that their respective Boards of Directors have unanimously
approved a definitive agreement to merge the two companies.
Separately, VoiceStream is in the process of completing a previously announced
merger with Omnipoint Corporation [NASDAQ: OMPT]. When the Aerial and Omnipoint
mergers are completed, it is anticipated that VoiceStream will have a total
equity market capitalization of $13 billion. For the quarter ended June 30,
1999, the three companies reported combined annualized service revenues in
excess of $825 million and collectively served nearly 1.5 million customers.
When both transactions are completed, VoiceStream will own licenses to provide
service to nearly 200 million people.
"Aerial's markets are both attractive and highly complementary to VoiceStream's
ever-expanding footprint across the United States," said John W. Stanton,
chairman and chief executive officer of VoiceStream. "After our mergers with
Aerial and Omnipoint are completed, together with Cook Inlet Region Inc. (CIRI),
nearly three out of every four people in the United States will live in
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VoiceStream markets. Based on the consumer promise of - "Get More From
VoiceStream" - our systems will serve markets from New York to Hawaii, and from
Minneapolis to Houston. With licenses in 22 of the 25 largest markets, the
combined company will be one of the major nationwide providers of communications
services in the country."
"We are extremely pleased to join forces with VoiceStream," said Don Warkentin,
president and chief executive officer of Aerial Communications. "The combination
of our two companies will offer substantial economies of scale to strengthen our
competitive position. Aerial has been a leader in offering customers some of the
largest network coverage areas in the industry. Within our markets, our network
covers more than 80% of our licensed population. Now we will be part of the
largest GSM operator in the country, and measured in terms of people in licensed
areas, the largest GSM operator in the world. The combined company will be a
strong, established national player. Aerial shareholders and customers will
benefit greatly from our united talents and expanded financial resources."
Telephone and Data Systems Inc. [AMEX: TDS] is the majority shareholder of
Aerial. "TDS is extremely pleased to be a significant investor in the
combination of Aerial and VoiceStream Wireless," said LeRoy T. Carlson, Jr.,
chairman of Aerial and president and chief executive officer of TDS. "Both
companies have been leaders in successfully establishing and rapidly expanding
the North American GSM network. We are now better positioned to continue to
benefit from the explosive growth in the U.S. wireless industry." Subsequent to
the mergers, TDS will own approximately 14% of VoiceStream.
VoiceStream and Aerial Merger
VoiceStream Wireless and Aerial Communications will enter into a merger in which
VoiceStream will exchange 0.455 shares of VoiceStream common stock for each of
Aerial Communications' Common Shares and Series A Common Shares. Aerial public
shareholders will have a right to elect to receive $18 in cash in lieu of shares
of VoiceStream. The parties anticipate that the merger will be tax-free to
Aerial shareholders who elect to receive VoiceStream stock. TDS and major
shareholders of VoiceStream, including Hutchison Telecommunication PCS (USA),
have agreed irrevocably to vote in favor of the merger. This merger is subject
to shareholder approval by both companies as well as federal, state, and other
regulatory approvals, including those of
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the Federal Communications Commission and the Federal Trade Commission. The
merger is expected to close in the first quarter of 2000.
In a series of transactions that will take place before the merger, TDS will
replace $420 million of Aerial debt owed to TDS with equity of Aerial at $22 per
Aerial share and Sonera Ltd., a Finnish telecommunications company, will invest
an additional $230 million into equity of Aerial and one of its subsidiaries,
also at an equivalent price of $22 per Aerial share, and immediately prior to
the merger exchange its interest in the subsidiary of Aerial for Aerial common
stock. As a consequence, Aerial will have 116 million shares outstanding
immediately prior to the merger.
Sonera Investment
In a separate announcement, Sonera has agreed to invest $500 million in
VoiceStream at the closing of the Omnipoint merger, purchasing shares at $57 per
VoiceStream share. Kaj-Erik Relander, executive vice president of Sonera, said,
"The merger of VoiceStream and Aerial and our investment are major steps in
building a U.S.-wide, GSM-based company capable of delivering the next
generation of wireless communications services." According to Relander, "Sonera
is looking forward to making its investment in VoiceStream and working with its
U.S.- based strategic partners to introduce emerging wireless data, mobile
portal and other mobile electronic commerce services throughout the United
States."
Upon the completion of both the Omnipoint and Aerial mergers into VoiceStream,
Sonera Ltd. will have an 8% interest in VoiceStream. Sonera, TDS and Aerial also
reached an agreement to settle all their disputes relating to Sonera's earlier
investment in the Aerial subsidiary, effective at the closing of the
VoiceStream-Aerial merger
Management
John W. Stanton will remain the chairman and chief executive officer of
VoiceStream. Donald Guthrie and Doug Smith will be vice chairmen of VoiceStream.
Bob Stapleton will serve as president and chief operating officer of the
combined company.
Background Information
VoiceStream Wireless Corp. is a leading provider of wireless communications
services in the western United States including Denver, Phoenix, Seattle, Salt
Lake City, and Portland.
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VoiceStream Wireless currently provides personal communications service using
the globally dominant GSM technology in eleven U.S. markets. In conjunction with
joint ventures, VoiceStream currently provides PCS service in four additional
markets. Additionally, Hutchison Whampoa Limited, a conglomerate headquartered
in Hong Kong, is a strategic partner and major shareholder of VoiceStream.
Goldman, Sachs & Co. acted as advisor to VoiceStream Wireless.
Aerial Communications, headquartered in Chicago, provides PCS service using GSM
technology in licensed areas that comprise 27.5 million of the U.S. population.
Aerial's markets include Columbus, Ohio; Houston, Minneapolis, Kansas City,
Pittsburgh and Tampa/Orlando/St. Petersburg. Through its roaming partners,
Aerial offers coverage coast-to-coast throughout the U.S. as well as
international roaming with more than 40 wireless partners. Donaldson, Lufkin &
Jenrette acted as advisor to Aerial Communications. Wasserstein Perella acted as
advisor to the Aerial Communications Special Committee of independent directors.
Telephone and Data Systems, Inc. is a diversified telecommunications corporation
founded in 1969. Through its strategic business units, TDS operates primarily in
cellular, local telephone and personal communications services ("PCS") markets
around the country. TDS builds value for its shareholders by providing excellent
communications services in growing, closely-related segments of the
telecommunications industry. The Company currently employs approximately 10,000
people and serves 3.3 million customers in 35 states. TDS is the majority
shareholder of Aerial Communications, Inc. and as of June 30, 1999, owned
approximately 59.1 million shares of Aerial. Credit Suisse First Boston
Corporation acted as advisor to Telephone and Data Systems, Inc.
Sonera Ltd., the leading mobile communications provider in Finland, is a pioneer
in the rapidly growing mobile, data and media communications sectors. Sonera has
interests in service providers in 14 other countries.
CIRI, based in Anchorage, Alaska, is an Alaska Native regional corporation with
investments in nationwide communications, tourism, real estate, and construction
and equipment services. CIRI is owned by 6,900 Alaska Native shareholders of
Eskimo, Indian, and Aleut descent.
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Except for the historical and factual information presented, other information
set forth in this news release represents forward-looking statements, including
all statements about companies' plans, beliefs, estimates and expectations.
These statements are based on current estimates and projections, which involve
certain risks and uncertainties that could cause actual results to differ
materially from those in the forward-looking statements. Important factors that
may affect these forward-looking statements include, but are not limited to:
appropriate regulatory approval; shareholder approvals; conditions in the
capital markets and availability of future financing; changes in the overall
economy; changes in competition in the markets in which the companies operate;
changes in the telecommunications regulatory environment; pending and future
litigation; unanticipated changes in growth in cellular and PCS customers,
penetration rates, churn rates and the mix of products and services offered; and
unanticipated problems with the Year 2000 issue. Investors are encouraged to
consider these and other risks and uncertainties that are discussed in documents
filed by VoiceStream Wireless, TDS and Aerial Communications with Securities and
Exchange Commission.
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