<PAGE>
As filed with the Securities and Exchange Commission on August 20, 1999
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
ITC/\DELTACOM, INC.
(Exact name of registrant as specified in its charter)
----------------
Delaware 58-2301135
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1791 O.G. Skinner Drive
West Point, Georgia 31833
(Address of principal executive offices)
ITC/\DeltaCom, Inc. 1997 Stock Option Plan
(Full title of the plans)
Andrew M. Walker
Chief Executive Officer
ITC/\DeltaCom, Inc.
1791 O.G. Skinner Drive
West Point, Georgia 31833
(706) 385-8000
(Name, address and telephone number, including area code, of agent for
service)
----------------
Copy to:
Nancy J. Kellner, Esq.
Hogan & Hartson L.L.P.
555 Thirteenth Street, N.W.
Washington, D.C. 20004-1109
(202) 637-5600
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CALCULATION OF REGISTRATION FEE
<TABLE>
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<CAPTION>
Proposed
Proposed maximum
Amount maximum aggregate Amount of
Title of securities to be to be offering price offering registration
registered registered per share(1) price(1) fee(1)
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<S> <C> <C> <C> <C>
Common Stock, par value
$.01................... 3,000,000 $24.875 $74,625,000 $20,745.75
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- -------------------------------------------------------------------------------
</TABLE>
(1) Estimated pursuant to Rule 457(c) and (h) of the Securities Act of 1933
solely for purposes of calculating the amount of the registration fee.
----------------
This Registration Statement incorporates by reference the information
contained in the registration statement on Form S-8 filed by ITC/\DeltaCom,
Inc. with the Securities and Exchange Commission on December 19, 1997
(Registration No. 333-42785) relating to, among other plans, the ITC/\DeltaCom,
Inc. 1997 Stock Option Plan.
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<PAGE>
EXPLANATORY NOTE
As permitted by General Instruction E to the Form S-8, this Registration
Statement incorporates by reference the information contained in the
registration statement on Form S-8 filed by ITC/\DeltaCom, Inc. (the
"Company") with the Securities and Exchange Commission on December 19, 1997
(Registration No. 333-42785) relating to, among other plans, the
ITC/\DeltaCom, Inc. 1997 Stock Option Plan (the "Plan").
On July 29, 1998, the Company announced a two-for-one stock split of its
common stock, par value $.01 per share (the "Common Stock"), to be effected in
the form of a stock dividend. The record date for the stock split was August
18, 1998 and the payment date was September 4, 1998. The Common Stock began
trading giving effect to the stock split on September 8, 1998. Appropriate
adjustments to the Company's stock option plans, including the Plan, were made
as of September 8, 1998. All references to number of shares in this Form S-8
have been adjusted to reflect the stock split.
On March 25, 1999, the Board of Directors of the Company adopted an
amendment to the Plan, subject to stockholder approval, to increase by
3,000,000 the number of shares of Common Stock available for issuance
thereunder to 7,815,000 shares from 4,815,000 shares. The Company's
stockholders approved the amendment to the Plan at the annual meeting of
stockholders held on May 13, 1999. Accordingly, as amended, the total number
of shares of Common Stock available under the Plan is 7,815,000, of which
3,000,000 shares are being registered hereunder.
Except for the foregoing amendment, the Plan remains unchanged.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Anthony S. Harrington, a partner of Hogan & Hartson L.L.P., counsel to the
Company, beneficially owns approximately 118,000 shares of Common Stock.
ITEM 8. EXHIBITS.
There are filed with the Registration Statement the following exhibits:
<TABLE>
<C> <S>
4.1 Certificate of Incorporation of ITC/\DeltaCom, Inc. (filed as Exhibit
3.1 to Registration Statement on Form S-4 (No. 333-71735) and
incorporated herein by reference).
4.2 Amended and Restated Bylaws of ITC/\DeltaCom, Inc. (filed as Exhibit 3.2
to Registration Statement on Form S-1 (No. 333-36683) and incorporated
herein by reference).
4.3 ITC/\DeltaCom, Inc. 1997 Stock Option Plan (Amended and Restated).
5.1 Opinion of Hogan & Hartson L.L.P. with respect to the legality of the
Common Stock registered hereby.
23.1 Consent of Arthur Andersen L.L.P.
23.2 Consent of Hogan & Hartson L.L.P. (contained in its opinion filed as
Exhibit 5.1 to this Registration Statement).
24.1 Power of Attorney (included in the signature page to this Registration
Statement).
</TABLE>
II-1
<PAGE>
SIGNATURES
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 West Point, Georgia, on this 27th day of July, 1999.
ITC/\DELTACOM, INC.
/s/ Andrew M. Walker
By __________________________________
Andrew M. Walker
Vice Chairman and Chief Executive
Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Campbell B. Lanier, III, Andrew M. Walker and
Douglas A. Shumate, jointly and severally, each in his own capacity, his true
and lawful attorneys-in-fact, with full power of substitution, for him and his
name, place and stead, in any and all capacities, to sign any and 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, with full power and
authority to do so 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 of any of them, or his or their substitute or
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 below, on this 27th day of July, 1999.
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ Campbell B. Lanier Chairman, Director
______________________________________
Campbell B. Lanier, III
/s/ Andrew M. Walker Vice Chairman, Chief Executive Officer and
______________________________________ Director (Principal executive officer)
Andrew M. Walker
/s/ Douglas A. Shumate Senior Vice President and Chief Financial
______________________________________ Officer (Principal financial officer and
Douglas A. Shumate principal accounting officer)
/s/ Donald W. Burton Director
______________________________________
Donald W. Burton
/s/ Malcolm C. Davenport Director
______________________________________
Malcolm C. Davenport
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ Robert A. Dolson Director
______________________________________
Robert A. Dolson
/s/ O. Gene Gabbard Director
______________________________________
O. Gene Gabbard
/s/ William T. Parr Director
______________________________________
William T. Parr
/s/ William H. Scott, III Director
______________________________________
William H. Scott, III
/s/ William B. Timmerman Director
______________________________________
William B. Timmerman
</TABLE>
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Sequential
Number Description Page Number
------- ----------- -----------
<C> <S> <C>
4.1 Certificate of Incorporation of ITC/\DeltaCom, Inc.
(filed as Exhibit 3.1 to Registration Statement on Form
S-4 (No. 333-71735) and incorporated herein by
reference).
4.2 Amended and Restated Bylaws of ITC/\DeltaCom, Inc. (filed
as Exhibit 3.2 to Registration Statement on Form S-1
(No. 333-36683) and incorporated herein by reference).
4.3 ITC/\DeltaCom, Inc. 1997 Stock Option Plan (Amended and
Restated).
5.1 Opinion of Hogan & Hartson L.L.P. with respect to the
legality of the Common Stock registered hereby.
23.1 Consent of Arthur Andersen L.L.P.
23.2 Consent of Hogan & Hartson L.L.P. (contained in its
opinion filed as Exhibit 5.1 to this Registration
Statement).
24.1 Power of Attorney (included in the signature page to
this Registration Statement).
</TABLE>
<PAGE>
EXHIBIT 4.3
ITC/\DELTACOM, INC.
1997 STOCK OPTION PLAN
(Amended and Restated)
<PAGE>
TABLE OF CONTENTS
Page
----
1. PURPOSE................................................ 2
2. DEFINITIONS............................................ 2
3. ADMINISTRATION......................................... 4
3.1. Committee......................................... 4
3.2. No Liability...................................... 5
4. STOCK.................................................. 5
5. ELIGIBILITY............................................ 5
6. EFFECTIVE DATE AND TERM................................ 5
6.1. Effective Date.................................... 5
6.2. Term.............................................. 6
7. GRANT OF OPTIONS....................................... 6
8. LIMITATION ON INCENTIVE STOCK OPTIONS.................. 6
9. OPTION AGREEMENTS...................................... 6
10. OPTION PRICE.......................................... 6
11. TERM AND EXERCISE OF OPTIONS.......................... 7
11.1. Term............................................. 7
11.2. Exercise by Optionee............................. 7
11.3. Option Period and Limitations on Exercise........ 7
11.4. Method of Exercise............................... 8
11.5. Parachute Limitations............................ 9
12. TRANSFERABILITY OF OPTIONS............................ 10
13. TERMINATION OF SERVICE RELATIONSHIP................... 10
14. RIGHTS IN THE EVENT OF DEATH OR DISABILITY............ 11
14.1. Death............................................ 11
14.2. Disability....................................... 12
15. USE OF PROCEEDS....................................... 12
16. SECURITIES LAWS....................................... 12
17. EXCHANGE ACT: RULE 16B-3.............................. 13
17.1. General.......................................... 13
17.2. Compensation Committee........................... 13
17.3. Restriction on Transfer of Stock................. 13
18. AMENDMENT AND TERMINATION............................. 14
19. EFFECT OF CHANGES IN CAPITALIZATION................... 14
19.1. Changes in Stock................................. 14
20. REORGANIZATION WITH CORPORATION SURVIVING............. 14
20.1. Other Reorganizations; Sale of Assets or Stock... 15
20.2. Adjustments...................................... 15
20.3. No Limitations on Corporation.................... 15
21. WITHHOLDING........................................... 16
22. DISCLAIMER OF RIGHTS.................................. 16
23. NONEXCLUSIVITY........................................ 16
24. GOVERNING LAW......................................... 16
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<PAGE>
ITC/\DELTACOM, INC.
1997 STOCK OPTION PLAN
(Amended and Restated)
ITC/\DELTACOM, INC., a Delaware corporation (the "Corporation"), sets
forth herein the terms of the 1997 Stock Option Plan (the "Plan") as follows:
1. PURPOSE
The Plan is intended to advance the interests of the Corporation by
providing eligible individuals (as designated pursuant to Section 5 hereof) an
opportunity to acquire or increase a proprietary interest in the Corporation,
which thereby will create a stronger incentive to expend maximum effort for the
growth and success of the Corporation and its subsidiaries and will encourage
such eligible individuals to continue to service the Corporation.
2. DEFINITIONS
For purposes of interpreting the Plan and related documents (including
Option Agreements), the following definitions shall apply:
2.1 "Affiliate" means any company or other trade or business that is
controlled by or under common control with the Corporation, (determined in
accordance with the principles of Section 414(b) and 414(c) of the Code and the
regulations thereunder) or is an affiliate of the Corporation within the meaning
of Rule 405 of Regulation C under the 1933 Act.
2.2 "Board" means the Board of Directors of the Corporation.
2.3 "Cause" means, unless otherwise defined in an Option Agreement,
(i) gross negligence or willful misconduct in connection with the performance of
duties; (ii) conviction of a criminal offense (other than minor traffic
offenses); or (iii) material breach of any term of any employment, consulting or
other services, confidentiality, intellectual property or non-competition
agreements, if any, between Optionee and the Corporation or any of its
Subsidiaries or Affiliates.
2.4 "Code" means the Internal Revenue Code of 1986, as now in effect
or as hereafter amended.
2.5 "Committee" means the Compensation Committee of the Board which
must consist of no fewer than two members of the Board and shall be appointed by
the Board.
-2-
<PAGE>
2.6 "Corporation" means ITC/\DELTACOM, Inc.
2.7 "Effective Date" means the date of adoption of the Plan by the
Board.
2.8 "Employer" means ITC/\DELTACOM, Inc. or the Subsidiary, Affiliate
or majority stockholder of the Corporation which employs the designated
recipient of an Option.
2.9 "Exchange Act" means the Securities Exchange Act of 1934, as now
in effect or as hereafter amended.
2.10 "Fair Market Value" means the value of each share of Stock
subject to the Plan determined as follows: if on the Grant Date or other
determination date the shares of Stock are listed on an established national or
regional stock exchange, are admitted to quotation on the National Association
of Securities Dealers Automated Quotation System, or are publicly traded on an
established securities market, the Fair Market Value of the shares of Stock
shall be the closing price of the shares of Stock on such exchange or in such
market (the highest such closing price if there is more than one such exchange
or market) on the trading day immediately preceding the Grant Date (or on the
Grant Date, if so specified by the Committee or the Board) or such other
determination date (or if there is no such reported closing price, the Fair
Market Value shall be the mean between the highest bid and lowest asked prices
or between the high and low sale prices on such trading day) or, if no sale of
the shares of Stock is reported for such trading day, on the next preceding day
on which any sale shall have been reported. If the shares of Stock are not
listed on such an exchange, quoted on such System or traded on such a market,
Fair Market Value shall be determined by the Board in good faith.
2.11 "Grant Date" means the later of (i) the date as of which the
Committee approves the grant and (ii) the date as of which the Optionee and the
Corporation, Subsidiary, Affiliate or majority stockholder of the Corporation
enter the relationship resulting in the Optionee being eligible for grants.
2.12 "Immediate Family Members" means the spouse, children and
grandchildren of the Optionee.
2.13 "Incentive Stock Option" means an "incentive stock option"
within the meaning of section 422 of the Code.
2.14 "Option" means an option to purchase one or more shares of Stock
pursuant to the Plan.
-3-
<PAGE>
2.15 "Option Agreement" means the written agreement evidencing the
grant of an Option hereunder.
2.16 "Optionee" means a person who holds an Option under the Plan.
2.17 "Option Period" means the period during which Options may be
exercised as defined in Section 11.
2.18 "Option Price" means the purchase price for each share of Stock
subject to an Option.
2.19 "Plan" means the ITC/\DELTACOM, Inc. 1997 Stock Option Plan.
2.20 "1933 Act" means the Securities Act of 1933, as now in effect or
as hereafter amended.
2.21 "Service Relationship" means the provision of bona fide
services to the Corporation, a Subsidiary, an Affiliate or the majority
stockholder as an employee, director, advisor or consultant.
2.22 "Stock" mean the shares of Common Stock, par value $.01 per
share, of the Corporation.
2.23 "Subsidiary" means any "subsidiary corporation" of the
Corporation within the meaning of Section 425(f) of the Code.
3. ADMINISTRATION
3.1. Committee
The Plan shall be administered by the Committee appointed by the
Board, which shall have the full power and authority to take all actions and to
make all determinations required or provided for under the Plan or any Option
granted or Option Agreement entered into hereunder and all such other actions
and determinations not inconsistent with the specific terms and provisions of
the Plan deemed by the Committee to be necessary or appropriate to the
administration of the Plan or any Option granted or Option Agreement entered
into hereunder. The interpretation and construction by the Committee of any
provision of the Plan or of any Option granted or Option Agreement entered into
hereunder shall be final and conclusive.
-4-
<PAGE>
3.2. No Liability
No member of the Board or of the Committee shall be liable for any
action or determination made, or any failure to take or make an action or
determination, in good faith with respect to the Plan or any Option granted or
Option Agreement entered into hereunder.
4. STOCK
The stock that may be issued pursuant to Options granted under the
Plan shall be Stock, which shares may be treasury shares or authorized but
unissued shares. The number of shares of Stock that may be issued pursuant to
Options granted under the Plan shall not exceed in the aggregate 7,815,000
shares of Stock, which number of shares is subject to adjustment as provided in
Section 19 hereof. If any Option expires, terminates or is terminated for any
reason prior to exercise in full, the shares of Stock that were subject to the
unexercised portion of such Option shall be available for future Options granted
under the Plan.
5. ELIGIBILITY
Options may be granted under the Plan to (i) any officer or key
employee of the Corporation, any Subsidiary, any Affiliate or the majority
stockholder of the Corporation (including any such officer or key employee who
is also a director of the Corporation, any Subsidiary, any Affiliate or the
majority stockholder of the Corporation) or (ii) any other individual whose
participation in the Plan is determined to be in the best interests of the
Corporation by the Committee. An individual may hold more than one Option,
subject to such restrictions as are provided herein.
6. EFFECTIVE DATE AND TERM
6.1. Effective Date
The Plan shall become effective as of the date of adoption by the
Board, subject to stockholders' approval of the Plan within one year of such
effective date by a majority of the votes cast at a duly held meeting of the
stockholders of the Corporation at which a quorum representing a majority of all
outstanding stock is present, either in person or by proxy, and voting on the
matter, or by written consent in accordance with applicable state law and the
Certificate of Incorporation and By-Laws of the Corporation; provided, however,
-------- -------
that upon approval of the Plan by the stockholders of the Corporation, all
Options granted under the Plan on or after the effective date shall be fully
effective as if the stockholders of the Corporation had approved the Plan on the
effective date. If the stockholders fail to approve the Plan within one year of
such effective date, any Options granted hereunder shall be null, void and of no
effect.
-5-
<PAGE>
6.2. Term
The Plan shall terminate on the date 10 years after the effective
date.
7. GRANT OF OPTIONS
Subject to the terms and conditions of the Plan, the Committee may, at
any time and from time to time prior to the date of termination of the Plan,
grant to such eligible individuals as the Committee may determine Options to
purchase such number of shares of Stock on such terms and conditions as the
Committee may determine, including any terms or conditions which may be
necessary to qualify such Options as Incentive Stock Options. Without limiting
the foregoing, the Committee may at any time, with the consent of the Optionee,
amend the terms of outstanding Options or issue new Options in exchange for the
surrender and cancellation of outstanding Options. The date on which the
Committee approves the grant of an Option (or such later date as is specified by
the Committee) shall be considered the date on which such Option is granted.
The maximum number of shares of Stock subject to Options that can be awarded
under the Plan to any person is 1,605,000 shares.
8. LIMITATION ON INCENTIVE STOCK OPTIONS
An Option shall constitute an Incentive Stock Option only to the
extent that (i) it is designated an Incentive Stock Option and (ii) the
aggregate fair market value (determined at the time the Option is granted) of
the Stock with respect to which Incentive Stock Options are exercisable for the
first time by any Optionee during any calendar year (under the Plan and all
other plans of the Optionee's employer corporation and its parent and subsidiary
corporations within the meaning of Section 422(d) of the Code) does not exceed
$100,000. This limitation shall be applied by taking Options into account in
the order in which such Options were granted.
9. OPTION AGREEMENTS
All Options granted pursuant to the Plan shall be evidenced by written
agreements to be executed by the Corporation and the Optionee, in such form or
forms as the Committee shall from time to time determine. Option Agreements
covering Options granted from time to time or at the same time need not contain
similar provisions; provided, however, that all such Option Agreements shall
-------- -------
comply with all terms of the Plan.
10. OPTION PRICE
The purchase price of each share of Stock subject to an Option shall
be fixed by the Committee and stated in each Option Agreement. In the case of
an Option that is intended to constitute an Incentive Stock Option, the Option
Price
-6-
<PAGE>
shall be not less than the greater of par value or 100 percent of the fair
market value of a share of the Stock covered by the Option on the date the
Option is granted (as determined in good faith by the Committee); provided,
--------
however, that in the event the Optionee would otherwise be ineligible to receive
- -------
an Incentive Stock Option by reason of the provisions of Sections 422(b)(6) and
424(d) of the Code (relating to stock ownership of more than 10 percent), the
Option Price of an Option which is intended to be an Incentive Stock Option
shall be not less than the greater of par value or 110 percent of the fair
market value of a share of the Stock covered by the Option at the time such
Option is granted. In the case of an Option not intended to constitute an
Incentive Stock Option, the Option Price shall be not less than the par value of
a share of the Stock covered by the Option on the date the Option is granted.
11. TERM AND EXERCISE OF OPTIONS
11.1. Term
Each Option granted under the Plan shall terminate and all rights to
purchase shares thereunder shall cease upon the expiration of 10 years from the
date such Option is granted, or on such date prior thereto as may be fixed by
the Committee and stated in the Option Agreement relating to such Option;
provided, however, that in the event the Optionee would otherwise be ineligible
- -------- -------
to receive an Incentive Stock Option by reason of the provisions of Sections
422(b)(6) and 424(d) of the Code (relating to stock ownership of more than 10
percent), an Option granted to such Optionee which is intended to be an
Incentive Stock Option shall in no event be exercisable after the expiration of
five years from the date it is granted.
11.2. Exercise by Optionee
Only the Optionee receiving an Option or a transferee of an Option
pursuant to Section 12 (or, in the event of the Optionee's legal incapacity or
incompetency, the Optionee's guardian or legal representative, and in the case
of the Optionee's death, the Optionee's estate) may exercise the Option.
11.3. Option Period and Limitations on Exercise
Each Option granted under the Plan shall be exercisable in whole or in
part at any time and from time to time over a period commencing on or after the
date of grant of the Option and ending upon the expiration or termination of the
Option, as the Committee shall determine and set forth in the Option Agreement
relating to such Option. Without limitation of the foregoing, the Committee,
subject to the terms and conditions of the Plan, may in its sole discretion
provide that an Option may not be exercised in whole or in part for any period
or periods of time during which such Option is outstanding as the Committee
shall determine and set forth in the Option Agreement relating to such Option.
Any such limitation on the exercise of an Option contained in any Option
Agreement may be rescinded,
-7-
<PAGE>
modified or waived by the Committee, in its sole discretion, at any time and
from time to time after the date of grant of such Option. Notwithstanding any
other provisions of the Plan, no Option shall be exercisable in whole or in part
prior to the date the Plan is approved by the stockholders of the Corporation as
provided in Section 6.1 hereof.
11.4. Method of Exercise
An Option that is exercisable hereunder may be exercised by delivery
to the Corporation on any business day, at its principal office addressed to the
attention of the Committee, of written notice of exercise, which notice shall
specify the number of shares for which the Option is being exercised, and shall
be accompanied by payment in full of the Option Price of the shares for which
the Option is being exercised. Payment of the Option Price for the shares of
Stock purchased pursuant to the exercise of an Option shall be made, as
determined by the Committee and set forth in the Option Agreement pertaining to
an Option, (a) in cash or by certified check payable to the order of the
Corporation; (b) through the tender to the Corporation of shares of Stock which,
if acquired from the Company, have been owned by the Optionee no less than six
(6) months and which shares shall be valued, for purposes of determining the
extent to which the Option Price has been paid thereby, at their Fair Market
Value on the date of exercise; (c) to the extent permitted by applicable law and
under the terms of the Option Agreement with respect to such Option, by causing
the Corporation to withhold shares of Stock otherwise issuable pursuant to the
exercise of an Option equal in value to the Option Price or portion thereof to
be satisfied pursuant to this clause (c) or (d) by a combination of the methods
described in Sections 11.4(a), 11.4(b) and 11.4(c) hereof; provided, however,
-------- -------
that the Committee may in its discretion impose and set forth in the Option
Agreement pertaining to an Option such limitations or prohibitions on the use of
shares of Stock to exercise Options as it deems appropriate. Payment in full of
the Option Price need not accompany the written notice of exercise provided the
notice directs that the Stock certificate or certificates for the shares for
which the Option is exercised be delivered to a licensed broker acceptable to
the Corporation as the agent for the individual exercising the Option and, at
the time such Stock certificate or certificates are delivered, the broker
tenders to the Corporation cash (or cash equivalents acceptable to the
Corporation) equal to the Option Price plus the amount (if any) of federal
and/or other taxes which the Corporation may, in its judgment, be required to
withhold with respect to the exercise of the Option. An attempt to exercise any
Option granted hereunder other than as set forth above shall be invalid and of
no force and effect. Promptly after the exercise of an Option and the payment
in full of the Option Price of the shares of Stock covered thereby, the
individual exercising the Option shall be entitled to the issuance of a Stock
certificate or certificates evidencing such individual's ownership of such
shares. A separate Stock certificate or certificates shall be issued for any
shares purchased pursuant to the exercise of an Option which is an Incentive
Stock Option, which certificate or certificates shall not include any shares
which were
-8-
<PAGE>
purchased pursuant to the exercise of an Option which is not an Incentive Stock
Option. An individual holding or exercising an Option shall have none of the
rights of a stockholder until the shares of Stock covered thereby are fully paid
and issued to such individual and, except as provided in Section 19 hereof, no
adjustment shall be made for dividends or other rights for which the record date
is prior to the date of such issuance.
11.5. Parachute Limitations
Notwithstanding any other provision of this Plan or of any other
agreement, contract, or understanding heretofore or hereafter entered into by
the Optionee with the Corporation or any Subsidiary, except an agreement,
contract, or understanding hereafter entered into that expressly modifies or
excludes application of this paragraph (an "Other Agreement"), and
notwithstanding any formal or informal plan or other arrangement heretofore or
hereafter adopted by the Corporation (or any such Subsidiary) for the direct or
indirect provision of compensation to the Optionee (including groups or classes
of participants or beneficiaries of which the Optionee is a member), whether or
not such compensation is deferred, is in cash, or is in the form of a benefit to
or for the Optionee (a "Benefit Arrangement"), if the Optionee is a
"disqualified individual," as defined in Section 280G(c) of the Code, any Option
held by that Optionee and any right to receive any payment or other benefit
under this Plan shall not become exercisable or vested (i) to the extent that
such right to exercise, vesting, payment, or benefit, taking into account all
other rights, payments, or benefits to or for the Optionee under this Plan, all
Other Agreements, and all Benefit Arrangements, would cause any payment or
benefit to the Optionee under this Plan to be considered a "parachute payment"
within the meaning of Section 280G(b)(2) of the Code as then in effect (a
"Parachute Payment") and (ii) if, as a result of receiving a Parachute Payment,
---
the aggregate after-tax amounts received by the Optionee from the Corporation
under this Plan, all Other Agreements, and all Benefit Arrangements would be
less than the maximum after-tax amount that could be received by Optionee
without causing any such payment or benefit to be considered a Parachute
Payment. In the event that the receipt of any such right to exercise, vesting,
payment, or benefit under this Plan, in conjunction with all other rights,
payments, or benefits to or for the Optionee under any Other Agreement or any
Benefit Arrangement would cause the Optionee to be considered to have received a
Parachute Payment under this Plan that would have the effect of decreasing the
after-tax amount received by the Optionee as described in clause (ii) of the
preceding sentence, then the Optionee shall have the right, in the Optionee's
sole discretion, to designate those rights, payments, or benefits under this
Plan, any Other Agreements, and any Benefit Arrangements that should be reduced
or eliminated so as to avoid having the payment or benefit to the Optionee under
this Plan be deemed to be a Parachute Payment.
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12. TRANSFERABILITY OF OPTIONS
12.1. Transferability of Options
Except as provided in Section 12.2, during the lifetime of an
Optionee, only the Optionee (or, in the event of legal incapacity or
incompetency, the Optionee's guardian or legal representative) may exercise an
Option. Except as provided in Section 12.2, no Option shall be assignable or
transferable by the Optionee to whom it is granted, other than by will or the
laws of descent and distribution.
12.2. Family Transfers.
Subject to the terms of the applicable Option Agreement, an Optionee
may transfer all or part of an Option which is not an Incentive Stock Option to
(i) any Immediate Family Member, (ii) a trust or trusts for the exclusive
benefit of any Immediate Family Member, or (iii) a partnership in which
Immediate Family Members are the only partners, provided that (x) there may be
no consideration for any such transfer, and (y) subsequent transfers of
transferred Options are prohibited except those in accordance with this Section
12.2 or by will or the laws of descent and distribution. Following transfer,
any such Option shall continue to be subject to the same terms and conditions as
were applicable immediately prior to transfer, provided that for purposes of
Section 12.2 hereof the term "Optionee" shall be deemed to refer the transferee.
The events of termination of the Service Relationship of Sections 13 and 14
hereof shall continue to be applied with respect to the original Optionee,
following which the Option shall be exercisable by the transferee only to the
extent, and for the periods specified in Section 11.3.
13. TERMINATION OF SERVICE RELATIONSHIP
Upon the termination of the Service Relationship of an Optionee with
the Corporation, a Subsidiary or an Affiliate, other than by reason of the death
or "permanent and total disability" (within the meaning of Section 22(e)(3) of
the Code) of such Optionee or for Cause, any Option granted to an Optionee
pursuant to the Plan shall continue to be exercisable only to the extent that it
was exercisable immediately before such termination; provided, however, such
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Option shall terminate thirty (30) days after the date of such termination of
Service Relationship, unless earlier terminated pursuant to Section 11.1 hereof,
and such Optionee shall have no further right to purchase shares of Stock
pursuant to such Option; and provided further, that the Committee may provide,
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by inclusion of appropriate language in any Option Agreement, that an Optionee
may (subject to the general limitations on exercise set forth in Section 11.3
hereof), in the event of termination of the Service Relationship of the Optionee
with the Corporation, a Subsidiary or an Affiliate, exercise an Option, in whole
or in part, at any time subsequent to such termination of Service Relationship
and prior to termination of
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the Option pursuant to Section 11.1 hereof, either subject to or without regard
to any installment limitation on exercise imposed pursuant to Section 11.3
hereof, as the Committee, in its sole and absolute discretion, shall determine
and set forth in the Option Agreement. Upon the termination of the Service
Relationship of an Optionee with the Corporation, a Subsidiary or an Affiliate
for Cause, any Option granted to an Optionee pursuant to the Plan shall
terminate and such Optionee shall have no further right to purchase shares of
Stock pursuant to such Option; and provided however, that the Committee may
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provide, by inclusion of appropriate language in any Option Agreement, that an
Optionee may (subject to the general limitations on exercise set forth in
Section 11.3 hereof), in the event of termination of the Service Relationship of
the Optionee with the Corporation, a Subsidiary or an Affiliate for Cause,
exercise an Option, in whole or in part, at any time subsequent to such
termination of Service Relationship and prior to termination of the Option
pursuant to Section 11.1 hereof, either subject to or without regard to any
installment limitation on exercise imposed pursuant to Section 11.3 hereof, as
the Committee, in its sole and absolute discretion, shall determine and set
forth in the Option Agreement. Whether a leave of absence or leave on military
or government service shall constitute a termination of Service Relationship for
purposes of the Plan shall be determined by the Committee, which determination
shall be final and conclusive. For purposes of the Plan, including without
limitation this Section 13 and Section 14, unless otherwise provided in an
Option Agreement, a termination of Service Relationship with the Corporation, a
Subsidiary or an Affiliate shall not be deemed to occur if the Optionee
immediately thereafter has a Service Relationship with the Corporation, any
other Subsidiary or any other Affiliate.
14. RIGHTS IN THE EVENT OF DEATH OR DISABILITY
14.1. Death
If an Optionee dies while in a Service Relationship with the
Corporation, a Subsidiary or an Affiliate or within the period following the
termination of such Service Relationship during which the Option is exercisable
under Section 13 or 14.2 hereof, the executors, administrators, legatees or
distributees of such Optionee's estate shall have the right (subject to the
general limitations on exercise set forth in Section 11.3 hereof), at any time
within one year after the date of such Optionee's death and prior to termination
of the Option pursuant to Section 11.1 hereof, to exercise, in whole or in part,
any Option held by such Optionee at the date of such Optionee's death, whether
or not such Option was exercisable immediately prior to such Optionee's death;
provided, however, that the Committee may provide by inclusion of appropriate
- -------- -------
language in any Option Agreement that, in the event of the death of an Optionee,
the executors, administrators, legatees or distributees of such Optionee's
estate may exercise an Option (subject to the general limitations on exercise
set forth in Section 11.3 hereof), in whole or in part, at any time subsequent
to such Optionee's death and prior to termination of the Option pursuant to
Section 11.1 hereof, either subject to
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or without regard to any installment limitation on exercise imposed pursuant to
Section 11.3 hereof, as the Committee, in its sole and absolute discretion,
shall determine and set forth in the Option Agreement.
14.2. Disability
If an Optionee terminates a Service Relationship with the Corporation,
a Subsidiary or an Affiliate by reason of the "permanent and total disability"
(within the meaning of Section 22(e)(3) of the Code) of such Optionee, then such
Optionee shall have the right (subject to the general limitations on exercise
set forth in Section 11.3 hereof), at any time within one year after such
termination of Service Relationship and prior to termination of the Option
pursuant to Section 11.1 hereof, to exercise, in whole or in part, any Option
held by such Optionee at the date of such termination of Service Relationship,
whether or not such Option was exercisable immediately prior to such termination
of Service Relationship; provided, however, that the Committee may provide, by
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inclusion of appropriate language in any Option Agreement, that an Optionee may
(subject to the general limitations on exercise set forth in Section 11.3
hereof), in the event of the termination of the Service Relationship of the
Optionee with the Corporation or a Subsidiary by reason of the "permanent and
total disability" (within the meaning of Section 22(e)(3) of the Code) of such
Optionee, exercise an Option, in whole or in part, at any time subsequent to
such termination of Service Relationship and prior to termination of the Option
pursuant to Section 11.1 hereof, either subject to or without regard to any
installment limitation on exercise imposed pursuant to Section 11.3 hereof, as
the Committee, in its sole and absolute discretion, shall determine and set
forth in the Option Agreement. Whether a termination of a Service Relationship
is to be considered by reason of "permanent and total disability" for purposes
of the Plan shall be determined by the Committee, which determination shall be
final and conclusive.
15. USE OF PROCEEDS
The proceeds received by the Corporation from the sale of Stock
pursuant to Options granted under the Plan shall constitute general funds of the
Corporation.
16. SECURITIES LAWS
The Corporation shall not be required to sell or issue any shares of
Stock under any Option if the sale or issuance of such shares would constitute a
violation by the individual exercising the Option or by the Corporation of any
provisions of any law or regulation of any governmental authority, including,
without limitation, any federal or state securities laws or regulations. If at
any time the Corporation shall determine, in its discretion, that the listing,
registration or qualification of any shares subject to the Option upon any
securities exchange or under any state or federal law, or the consent of any
government regulatory body, is
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necessary or desirable as a condition of, or in connection with, the issuance or
purchase of shares, the Option may not be exercised in whole or in part unless
such listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Corporation,
and any delay caused thereby shall in no way affect the date of termination of
the Option. Specifically in connection with the Securities Act, upon exercise of
any Option, unless a registration statement under the Securities Act is in
effect with respect to the shares of Stock covered by such Option, the
Corporation shall not be required to sell or issue such shares unless the
Corporation has received evidence satisfactory to the Corporation that the
Optionee may acquire such shares pursuant to an exemption from registration
under the Securities Act. Any determination in this connection by the
Corporation shall be final and conclusive. The Corporation may, but shall in no
event be obligated to, register any securities covered hereby pursuant to the
Securities Act. The Corporation shall not be obligated to take any affirmative
action in order to cause the exercise of an Option or the issuance of shares
pursuant thereto to comply with any law or regulation of any governmental
authority. As to any jurisdiction that expressly imposes the requirement that an
Option shall not be exercisable unless and until the shares of Stock covered by
such Option are registered or are subject to an available exemption from
registration, the exercise of such Option (under circumstances in which the laws
of such jurisdiction apply) shall be deemed conditioned upon the effectiveness
of such registration or the availability of such an exemption.
17. EXCHANGE ACT: RULE 16B-3
17.1. General
The Plan is intended to comply with Rule 16b-3 ("Rule 16b-3") (and any
successor thereto) under the Exchange Act. Any provision inconsistent with Rule
16b-3 shall, to the extent permitted by law and determined to be advisable by
the Committee (constituted in accordance with Section 17.2 hereof), be
inoperative and void.
17.2. Compensation Committee
The Committee appointed in accordance with Section 3.1 hereof shall
consist of not fewer than two members of the Board each of whom shall qualify
(at the time of appointment to the Committee and during all periods of service
on the Committee) in all respects as a "non-employee director" as defined in
Rule 16b-3.
17.3. Restriction on Transfer of Stock
No director, officer or other "insider" of the Corporation subject to
Section 16 of the Exchange Act shall be permitted to sell Stock (which such
"insider" had received upon exercise of an Option) during the six months
immediately following the grant of such Option.
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18. AMENDMENT AND TERMINATION
The Board may, at any time and from time to time, amend, suspend or
terminate the Plan as to any shares of Stock as to which Options have not been
granted. The Corporation also may retain the right in an Option Agreement to
cause a forfeiture of the shares or gain realized by an Optionee on account of
the Optionee taking actions in "competition with the Corporation," as defined in
the applicable Option Agreement. Furthermore, the Corporation may, in the
Option Agreement, retain the right to annul the grant of an Option if the holder
of such grant had a Service Relationship with the Corporation, a Subsidiary, or
an Affiliate and is terminated "for cause," as defined in the applicable Option
Agreement. Except as permitted under Section 19 hereof, no amendment,
suspension or termination of the Plan shall, without the consent of the
Optionee, alter or impair rights or obligations under any Option theretofore
granted under the Plan.
19. EFFECT OF CHANGES IN CAPITALIZATION
19.1. Changes in Stock
If the number of outstanding shares of Stock is increased or decreased
or changed into or exchanged for a different number or kind of shares or other
securities of the Corporation by reason of any recapitalization,
reclassification, stock split-up, combination of shares, exchange of shares,
stock dividend or other distribution payable in capital stock, or other increase
or decrease in such shares effected without receipt of consideration by the
Corporation, occurring after the effective date of the Plan, a proportionate and
appropriate adjustment shall be made by the Corporation in the number and kind
of shares for which Options are outstanding, so that the proportionate interest
of the Optionee immediately following such event shall, to the extent
practicable, be the same as immediately prior to such event. Any such
adjustment in outstanding Options shall not change the aggregate Option Price
payable with respect to shares subject to the unexercised portion of the Option
outstanding but shall include a corresponding proportionate adjustment in the
Option Price per share.
19.2. Reorganization With Corporation Surviving
Subject to Section 19.3 hereof, if the Corporation shall be the
surviving entity in any reorganization, merger or consolidation of the
Corporation with one or more other entities, any Option theretofore granted
pursuant to the Plan shall pertain to and apply to the securities to which a
holder of the number of shares of Stock subject to such Option would have been
entitled immediately following such reorganization, merger or consolidation,
with a corresponding proportionate adjustment of the Option Price per share so
that the aggregate Option Price thereafter shall be the same as the aggregate
Option Price of the shares remaining subject to the Option immediately prior to
such reorganization, merger or consolidation.
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19.3. Other Reorganizations; Sale of Assets or Stock
Upon the dissolution or liquidation of the Corporation, or upon a
merger, consolidation or reorganization of the Corporation with one or more
other entities in which the Corporation is not the surviving entity, or upon a
sale of substantially all of the assets of the Corporation to another person or
entity, or upon any transaction (including, without limitation, a merger or
reorganization in which the Corporation is the surviving entity) approved by the
Board that results in any person or entity (other than persons who are holders
of stock of the Corporation at the time the Plan is approved by the Stockholders
and other than an Affiliate) owning 80 percent or more of the combined voting
power of all classes of stock of the Corporation, the Plan and all Options
outstanding hereunder shall terminate, except to the extent provision is made in
connection with such transaction for the continuation of the Plan and/or the
assumption of the Options theretofore granted, or for the substitution for such
Options of new options covering the stock of a successor entity, or a parent or
subsidiary thereof, with appropriate adjustments as to the number and kinds of
shares and exercise prices, in which event the Plan and Options theretofore
granted shall continue in the manner and under the terms so provided. In the
event of any such termination of the Plan, each Optionee shall have the right
(subject to the general limitations on exercise set forth in Section 11.3 hereof
and except as otherwise specifically provided in the Option Agreement relating
to such Option), immediately prior to the occurrence of such termination and
during such period occurring prior to such termination as the Committee in its
sole discretion shall designate, to exercise such Option in whole or in part,
whether or not such Option was otherwise exercisable at the time such
termination occurs, but subject to any additional provisions that the Committee
may, in its sole discretion, include in any Option Agreement. The Committee
shall send written notice of an event that will result in such a termination to
all Optionees not later than the time at which the Corporation gives notice
thereof to its stockholders.
19.4. Adjustments
Adjustments under this Section 19 relating to stock or securities of
the Corporation shall be made by the Committee, whose determination in that
respect shall be final and conclusive. No fractional shares of Stock or units
of other securities shall be issued pursuant to any such adjustment, and any
fractions resulting from any such adjustment shall be eliminated in each case by
rounding downward to the nearest whole share or unit.
19.5. No Limitations on Corporation
The grant of an Option pursuant to the Plan shall not affect or limit
in any way the right or power of the Corporation to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure or to
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merge, consolidate, dissolve or liquidate, or to sell or transfer all or any
part of its business or assets.
20. WITHHOLDING
The Corporation or a Subsidiary may be obligated to withhold federal
and local income taxes and Social Security taxes to the extent that an Optionee
realizes ordinary income in connection with the exercise of an Option. The
Corporation or a Subsidiary may withhold amounts needed to cover such taxes from
payments otherwise due and owing to an Optionee, and upon demand the Optionee
will promptly pay to the Corporation or a Subsidiary having such obligation any
additional amounts as may be necessary to satisfy such withholding tax
obligation. Such payment shall be made in cash or cash equivalents.
21. DISCLAIMER OF RIGHTS
No provision in the Plan or in any Option granted or Option Agreement
entered into pursuant to the Plan shall be construed to confer upon any
individual the right to remain in the employ of the Corporation, any Subsidiary
or any Affiliate, or to interfere in any way with the right and authority of the
Corporation, any Subsidiary or any Affiliate either to increase or decrease the
compensation of any individual at any time, or to terminate any employment or
other relationship between any individual and the Corporation, any Subsidiary or
any Affiliate. The obligation of the Corporation to pay any benefits pursuant
to the Plan shall be interpreted as a contractual obligation to pay only those
amounts described herein, in the manner and under the conditions prescribed
herein. The Plan shall in no way be interpreted to require the Corporation to
transfer any amounts to a third party trustee or otherwise hold any amounts in
trust or escrow for payment to any participant or beneficiary under the terms of
the Plan.
22. NONEXCLUSIVITY
Neither the adoption of the Plan nor the submission of the Plan to the
stockholders of the Corporation for approval shall be construed as creating any
limitations upon the right and authority of the Board to adopt such other
incentive compensation arrangements (which arrangements may be applicable either
generally to a class or classes of individuals or specifically to a particular
individual or individuals) as the Board in its discretion determines desirable,
including, without limitation, the granting of stock options otherwise than
under the Plan.
23. GOVERNING LAW.
This Plan and all Options to be granted hereunder shall be governed by
the laws of the State of Delaware (but not including the choice of law rules
thereof).
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IN WITNESS WHEREOF, the Company caused its duly authorized officer to
execute this Plan as of the 24th day of March, 1997 to evidence its adoption of
this Plan, and the Company has caused its duly authorized officer to execute
this Plan, amended and restated as of August 5, 1999.
ITC/\DELTACOM, INC.
By: /s/ Tom Mullis
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EXHIBIT 5.1
[Hogan & Hartson L.L.P. Letterhead]
August 20, 1999
Board of Directors
ITC/\DeltaCom, Inc.
1791 O.G. Skinner Drive
West Point, Georgia 31833
Ladies and Gentlemen:
We are acting as counsel to ITC/\DeltaCom, Inc., a Delaware corporation (the
"Company"), in connection with its registration on Form S-8 (the "Registration
Statement") filed with the Securities and Exchange Commission relating to the
proposed offering of up to 3,000,000 shares of the Company's common stock, par
value $.01 per share, all of which shares (the "Shares") are issuable upon the
exercise of options granted under the ITC/\DeltaCom, Inc. 1997 Stock Option
Plan, as amended (the "Plan"). This opinion letter is furnished to you at your
request to enable you to fulfill the requirements of Item 601(b)(5) of
Regulation S-K, 17 C.F.R. Sec. 229.601(b)(5), in connection with the
Registration Statement.
For purposes of this opinion letter, we have examined copies of the
following documents:
1. An executed copy of the Registration Statement.
2. A copy of the Plan, as certified by the Secretary of the Company on the
date hereof as then being complete, accurate and in effect.
3. The Certificate of Incorporation of the Company, as certified by the
Secretary of State of the State of Delaware on July , 1999 and by the
Secretary of the Company on the date hereof as then being complete,
accurate and in effect.
4. The Amended and Restated Bylaws of the Company, as certified by the
Secretary of the Company on the date hereof as then being complete,
accurate and in effect.
5. Resolutions of the Board of Directors of the Company adopted at a
meeting held on March 25, 1999, as certified by the Secretary of the
Company on the date hereof as then being complete, accurate, and in
effect, relating to the issuance of the Shares.
6. Resolutions of the stockholders of the Company adopted May 13, 1999, as
certified by the Secretary of the Company on the date hereof as then
being complete, accurate, and in effect, relating to the issuance of the
Shares.
In our examination of the aforesaid documents, we have assumed the
genuineness of all signatures, the legal capacity of all natural persons, the
accuracy and completeness of all documents submitted to us, the authenticity
of all original documents, and the conformity to authentic original documents
of all documents submitted to us as copies (including telecopies). This
opinion is given, and all statements herein are made, in the context of the
foregoing.
This opinion letter is based as to matters of law solely on Delaware
corporate law. We express no opinion herein as to any other laws, statutes,
ordinances, rules, or regulations.
Based upon, subject to, and limited by the foregoing, we are of the opinion
that following (i) effectiveness of the Registration Statement, (ii) issuance
of the Shares pursuant to the terms of the Plan, and (iii) receipt by the
Company of the consideration for the Shares specified in the resolutions of
the Board of Directors or a committee of the Board of Directors authorizing
the issuance thereof, the Shares will be validly issued, fully paid, and
nonassessable.
<PAGE>
This opinion letter has been prepared for your use in connection the
Registration Statement and speaks as of the date hereof. We assume no
obligation to advise you of any changes in the foregoing subsequent to the
delivery of this opinion letter.
We hereby consent to the filing of this opinion letter as Exhibit 5.1 to the
Registration Statement. In giving this consent, we do not thereby admit that
we are an "expert" within the meaning of the Securities Act of 1933, as
amended.
Very truly yours,
HOGAN & HARTSON L.L.P.
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated February 12,
1999 included in ITC/\DeltaCom, Inc.'s Form 10-K for the year ended December
31, 1998 and to all references to our Firm included in this registration
statement.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
August 19, 1999
