<PAGE> 1
As filed with the Securities and Exchange Commission on August 23, 1996
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
PRICELLULAR CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 22-3043811
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
45 ROCKEFELLER PLAZA
SUITE 3200
NEW YORK, NEW YORK 10020
212-459-0800
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
---------------
PRICELLULAR CORPORATION
1994 STOCK OPTION PLAN
(FULL TITLE OF THE PLAN)
---------------
ROBERT PRICE
PRICELLULAR CORPORATION
SUITE 3200
45 ROCKEFELLER PLAZA
NEW YORK, NY 10020
(NAME AND ADDRESS OF AGENT FOR SERVICE)
TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE: (212) 459-0800
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==================================================================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
OFFERING AGGREGATE AMOUNT OF
TITLE OF SECURITIES AMOUNT TO BE PRICE PER OFFERING REGISTRATION
TO BE REGISTERED REGISTERED* SHARE** PRICE** FEE
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Class A Common Stock (par
value $.01 per share) ........... 2,109,375 shares $12.75 $26,894,532 $9,274
==================================================================================================================================
</TABLE>
* Plus an indeterminate number of additional shares which may be offered
and issued to prevent dilution resulting from stock splits, stock
dividends or similar transactions.
** Estimated pursuant to Rule 457(c) of the General Rules and Regulations
under the Securities Act of 1933 solely for the purpose of computing the
registration fee, based on the average of the high and low prices of the
securities being registered hereby on the American Stock Exchange
Composite Transaction Tape on August 22, 1996.
<PAGE> 2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Registrant hereby incorporates herein by reference the
following documents:
(1) The Company's Prospectus relating to the offering of
2,500,000 shares of the Company's Class A Common Stock dated July 30, 1996;
(2) All reports filed pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), since
December 31, 1995;
(3) The description of the Registrant's Class A Common Stock
contained in the Registrant's Registration Statement on Form 8-A filed on
December 8, 1994, as amended on June 19, 1996; and
(4) All documents filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to the date
of this Registration Statement and prior to the filing of a post-effective
amendment which indicates that all securities offered herein have been sold or
which deregisters all securities then remaining unsold.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the Delaware Corporation Law provides that a
Delaware corporation may indemnify any person against expenses, judgments, fines
and settlements actually and reasonably incurred by any such person in
connection with a threatened, pending or completed action, suit or proceeding in
which he is involved by reason of the fact that he is or was director, officer,
employee or agent of such corporation, provided that (i) he acted in good faith
and in a manner reasonably believed to be in or not opposed to the best
interests of the corporation and (ii) with respect to any criminal action or
proceeding, he had no reasonable cause to believe his conduct was unlawful. If
the action or suit is by or in the name of the corporation, the corporation may
indemnify any such person against expense actually and reasonably incurred by
him in connection with the defense or settlement of such action or suit if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, except that no indemnification
may be made in respect to any claim, issue or matter as to which such person
shall have been adjudged to be liable to the corporation for negligence or
misconduct in the performance of his duty to the corporation, unless and only to
the extent that the Delaware Court of Chancery or the court in which the action
or suit is brought determines upon application that, despite the adjudication of
liability but in view of all of the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expense as the court deems
proper.
Article XI, Section 1 of the Company's By-Laws provides for
indemnification of its directors and officers to the fullest extent permitted by
the Delaware Corporation Law. In accordance with the Delaware Corporation Law,
the Company's Certificate of Incorporation, as amended, limits the personal
liability of its directors for violations of their fiduciary duty. The
Certificate of Incorporation eliminates each director's liability to the Company
or its stockholders for monetary damages except (i) for any breach of the
director's duty of loyalty to the Company or its stockholders, (ii) for acts or
omissions not in good faith or which involve intentional misconduct or
<PAGE> 3
a knowing violation of law, (iii) under the section of the Delaware law
providing for liability of directors for unlawful payment of dividends or
unlawful stock purchases or redemptions, or (iv) for any transaction from which
a director derived any improper personal benefit. The effect of this provision
is to eliminate the personal liability of directors for monetary damages for
actions involving a breach of their fiduciary duty of care, including any such
actions involving gross negligence. This provision will not, however, limit in
any way the liability of directors for violations of the Federal securities
laws. The Company has entered into indemnification agreements with each of its
directors and officers to indemnify them to the maximum extent permitted by
Delaware law.
2
<PAGE> 4
EXHIBITS
The following is a complete list of exhibits filed as part of
this Registration Statement:
Exhibit
No.
- -------
4 1994 Stock Option Plan
5 Opinion of Davis Polk & Wardwell
23(a) Consent of Davis Polk & Wardwell (included in Exhibit 5)
23(b) Consent of Ernst & Young LLP
24 Powers of Attorney (included on pages 6-7)
UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) to file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933 (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the 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 the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high and of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in this registration statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
information to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by the
registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the registration statement.
(2) that, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities
3
<PAGE> 5
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof; and
(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 registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's Annual Report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
Annual Report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the 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 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.
4
<PAGE> 6
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 New York, New York, on the 23rd day of August, 1996.
PRICELLULAR CORPORATION
By: /s/ Robert Price
---------------------------
Robert Price
President
5
<PAGE> 7
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears below, constitutes and appoints Robert Price and Stuart B.
Rosenstein, and each of them, his true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution, to do any and all acts and
things and execute, in the name of the undersigned, any and all instruments
which said attorneys-in-fact and agents may deem necessary or advisable in order
to enable PriCellular Corporation to comply with the Securities Act of 1933 and
any requirements of the Securities and Exchange Commission in respect thereof,
in connection with the filing with the Securities and Exchange Commission of the
registration statement on Form S-8 under the Securities Act of 1933, including
specifically but without limitation, power and authority to sign the name of the
undersigned to such registration statement, and any amendment to such
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 to perform each and every act and thing requisite or
necessary to be done in and about the premises, as fully and to all intents and
purposes as the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, and any of them, or their
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 and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Robert Price Director and President August 23, 1996
- ---------------------------------- (Principal Executive Officer)
Robert Price
/s/ Stuart B. Rosenstein Vice President, Chief Financial August 23, 1996
- ---------------------------------- Officer and Treasurer
Stuart B. Rosenstein (Principal Financial and
Accounting Officer)
/s/ Kim I. Pressman Director, Vice President and August 23, 1996
- -------------------------------- Secretary
Kim I. Pressmen
/s/ Brion B. Applegate Director August 23, 1996
- --------------------------------
Brion B. Applegate
</TABLE>
6
<PAGE> 8
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------- ----- ----
<S> <C> <C>
/s/ Tim R. Palmer Director August 23, 1996
- ---------------------------------
Tim R. Palmer
/s/ Scott Sperling Director August 23, 1996
- --------------------------------
Scott Sperling
</TABLE>
7
<PAGE> 9
INDEX TO EXHIBITS
Exhibit Sequentially
Number Exhibit Numbered Page
- ------- ------- -------------
4 1994 Stock Option Plan
5 Opinion of Davis Polk & Wardwell
23(a) Consent of Davis Polk & Wardwell (included in Exhibit 5)
23(b) Consent of Ernst & Young LLP
24 Powers of Attorney (included on pages 6-7)
<PAGE> 1
EXHIBIT 4
PRICELLULAR CORPORATION
1994 STOCK OPTION PLAN,
AS AMENDED
ARTICLE I
Purpose
The purpose of this 1994 Stock Option Plan is to enable
PriCellular Corporation to offer selected employees of the Company and its
subsidiaries stock options and other equity interests in the Company, thereby
attracting, retaining and rewarding such employees, and strengthening the
mutuality of interests between such employees and the Company's shareholders.
ARTICLE II
Definitions
For purposes of this Plan, the following terms shall have the
following meanings:
2.1 "AWARD" shall mean any award under this Plan of any Stock
Option, Stock Appreciation Right or Other Stock-Based Award. All Awards shall be
granted by, confirmed by, and subject to the terms of, a written agreement
executed by the Company and the Participant.
2.2 "BOARD" shall mean the Board of Directors of the Company.
2.3 "CODE" shall mean the Internal Revenue Code of 1986, as
amended.
2.4 "COMMITTEE" shall mean a committee of the Board appointed
from time to time by the Board consisting of two or more Directors, each of
whom, to the extent necessary to comply with Rule 16b-3 only, shall be
disinterested persons as defined in Rule 16b-3. In the absence of the
appointment of such a committee, references to the Committee herein shall refer
to the Board.
<PAGE> 2
2.5 "COMMON STOCK" means the Common Stock, $.01 par value per
share, of the Company.
2.6 "COMPANY" shall mean PriCellular Corporation and, unless
the context clearly indicates otherwise, its subsidiaries.
2.7 "ELIGIBLE EMPLOYEES" shall mean the employees of the
Company and any other person providing services to the Company as an advisor or
consultant.
2.8 "FAIR MARKET VALUE" for purposes of this Plan, unless
otherwise required by any applicable provision of the Code or any regulations
issued thereunder, shall mean, as of any date, fair market value as determined
by the Committee.
2.9 "INCENTIVE STOCK OPTION" shall mean any Stock Option
awarded under this Plan intended to be and designated as an "incentive stock
option" within the meaning of Section 422 of the Code.
2.10 "NONQUALIFIED STOCK OPTION" shall mean any Stock Option
awarded under this Plan that is not an Incentive Stock Option.
2.11 "OTHER STOCK-BASED AWARD" shall mean any right or award
granted under Article VIII of the Plan.
2.12 "PARTICIPANT" shall mean an employee to whom an Award has
been made pursuant to this Plan.
2.13 "PLAN" shall mean this PriCellular Corporation 1994 Stock
Option Plan.
2.14 "RULE 16B-3" shall mean Rule 16b-3 promulgated under
Section 16 of the Securities Exchange Act of 1934, and the authorities issued
thereunder, and any successor rule thereto.
2.15 "STOCK APPRECIATION RIGHT" OR "SAR" shall mean the right
pursuant to an Award granted under Article VII.
2.16 "STOCK OPTION" OR "OPTION" shall mean any option to
purchase shares of Common Stock granted pursuant to Article VI.
2.17 "SUBSTITUTE AWARDS" shall mean Awards granted in
substitution for, or in assumption of, outstanding awards previously granted by
a company acquired by the Company or with which the Company combines.
<PAGE> 3
ARTICLE III
Administration
3.1 THE COMMITTEE. The Plan shall be administered and
interpreted by the Committee.
3.2 AWARDS. The Committee shall have full authority, subject
to the terms of this Plan and applicable law, to grant Awards to Eligible
Employees. In particular, the Committee shall have the authority:
(a) to select and designate Participants;
(b) to determine the type or types of Awards to be
granted to an Eligible Employee;
(c) to determine the number of shares of Common Stock to
be covered by each such Award granted hereunder;
(d) to determine the terms and conditions, not
inconsistent with the terms of this Plan, of any
Award granted hereunder;
(e) to determine whether and under what circumstances
Awards may be settled in cash, Common Stock, other
securities or other property or any combination of
the foregoing;
(f) to determine whether and under what circumstances an
Award may be canceled, forfeited or suspended and the
method(s) by which Awards may be canceled, forfeited
or suspended;
(g) to interpret and administer the Plan and any
instrument or agreement relating to, or Award made
under, the Plan;
(h) to establish, amend, suspend or waive such rules and
regulations and appoint such agents as it shall deem
appropriate for the proper administration of the
Plan; and
(i) to determine whether, to what extent and under what
circumstances Common Stock and other amounts payable
with respect to an Award under this Plan shall be
deferred either automatically or at the election of
the Participant or of the Committee.
3.3 DECISIONS FINAL. Any decision, designation, determination,
interpretation or other action made or taken under or in respect of the Plan or
any Award shall be within the absolute discretion of the Committee, may be made
at any time and shall be final, binding and conclusive on the Company, all
employees and Participants and their respective heirs, executors,
administrators, successors and assigns, any stockholder of the Company and any
Eligible Employee.
<PAGE> 4
3.4 RELIANCE ON COUNSEL. The Committee may consult with legal
counsel, who may be counsel for the Company or other counsel, with respect to
its obligations or duties hereunder, or with respect to any action or proceeding
or any question of law, and shall not be liable with respect to any action taken
or omitted by it in good faith pursuant to the advice of such counsel.
ARTICLE IV
Share Limitation
4.1 SHARES. Subject to adjustment as provided in Section 4.2,
the maximum aggregate number of shares of Common Stock with respect to which
Awards may be granted under this Plan shall not exceed 2,109,375 shares, which
may be either authorized and unissued Common Stock or outstanding Common Stock
reacquired by the Company. If any Award granted under this Plan shall expire,
terminate or be canceled for any reason without the delivery of shares of Common
Stock, shares subject to such Award, to the extent of such cancellation,
forfeiture or termination, shall again be available for Awards under this Plan.
Awards which by their terms may be settled only in cash shall not be counted
against such total, except as may be required to comply with Rule 16b-3. If any
Award is exercised by surrendering shares of Common Stock to the Company in
satisfaction of the exercise price of such Award or if any withholding tax
obligation arising in connection with such Award is satisfied by withholding
shares otherwise deliverable upon such exercise, then the number of shares so
surrendered or withheld shall again be available for Award under the Plan.
Shares of Common Stock delivered upon exercise of, or otherwise relating to,
Substitute Awards shall not be counted against the shares of Common Stock
available for Awards under the Plan except in the case of Substitute Awards
granted to individuals who are officers or directors of the Company for purposes
of Section 16 of the Securities Exchange Act of 1934.
4.2 ADJUSTMENTS. In the event that the Committee determines
that any dividend or distribution (whether in the form of cash, securities or
other property), stock split or reverse stock split, recapitalization,
reorganization, merger, consolidation, split-up, combination or exchange of
shares, distribution with respect to its outstanding Common Stock or capital
stock other than Common Stock, reclassification of its capital stock, issuance
of warrants or options to purchase any Common Stock or securities convertible
into Common Stock, or rights offering to purchase capital stock at a price below
fair market value, or any similar corporate transaction or event affects the
capital stock of the Company such that an adjustment is determined by the
Committee to be appropriate to prevent dilution or enlargement of the benefits
or potential benefits intended to be made available under the Plan, then the
Committee may, in its sole discretion and in such manner as it may deem
equitable, adjust any or all of the number and kind of shares which thereafter
may be subject to Awards under this Plan, both in aggregate and in respect of
any individual, the number and kind of shares subject to outstanding Awards
granted under this Plan and the purchase price thereof and, if deemed
appropriate, make provision for a cash payment to the holder of an outstanding
Award; provided, in each case, that with respect to Awards of Incentive Stock
Options no such adjustment shall be authorized to the extent that such authority
would cause the Plan to violate Section 422(b)(1) of the Code or any successor
provision thereto and, with respect to all Awards under the Plan, no such
adjustment shall be authorized to the extent that such authority would be
inconsistent with the requirements for full deductibility under Section 162(m)
of the
<PAGE> 5
Code and the regulations thereunder; and provided further that the number of
shares subject to any Award denominated in shares shall always be a whole
number.
4.3 INDIVIDUAL LIMIT. No individual may receive in any year
Awards under the Plan that relate to more than 937,500 shares of Common Stock.
ARTICLE V
Eligibility
5.1 Any Eligible Employee, including any such individual who
is also a member of the Company's Board of Directors, is eligible to be granted
Options and other Awards under this Plan. Eligibility under this Plan shall be
determined by the Committee.
ARTICLE VI
Stock Options
6.1 OPTIONS. Subject to the provisions of the Plan, the
Committee shall have sole and complete authority to determine the Eligible
Employees to whom Options shall be granted, the number of shares of Common Stock
to be covered by each Option, the option price therefor and the conditions and
limitations applicable to the exercise of the Option. The Committee shall have
the authority to grant Incentive Stock Options, Nonqualified Stock Options or
both. In the case of Incentive Stock Options, the terms and conditions of such
grants shall be subject to and comply with such rules as may be required by
Section 422 of the Code, as from time to time amended, and any implementing
regulations.
6.2 EXERCISE PRICE. Except in the case of a Stock Option which
is a Substitute Award, the exercise price of any Stock Option granted under this
Plan shall not be less than 100% of the fair market value of the underlying
shares of Common Stock on the date of grant.
6.3 INCENTIVE STOCK OPTIONS. Anything in the Plan to the
contrary notwithstanding, no term of this Plan relating to Incentive Stock
Options shall be interpreted, amended or altered, nor shall any discretion or
authority granted under the Plan be so exercised, so as to disqualify the Plan
under Section 422 of the Code, or, without the consent of the Participants
affected, to disqualify any Incentive Stock Option under such Section 422.
6.4 EXERCISE. Each Stock Option shall be exercisable at such
times and subject to such terms and conditions as the Committee may, in its sole
discretion, specify in the applicable Award agreement or thereafter, provided,
however, that in no event may any Stock Option granted hereunder be exercisable
after the expiration of 10 years after the date of such grant. The Committee may
impose such conditions with respect to the exercise of Stock Options, including
without limitation, any condition relating to the application of Federal or
state securities laws, as it may deem necessary or advisable.
<PAGE> 6
Except in the case of an Option which is a Substitute Award, no Stock Option
shall be exercisable earlier than six months after the date of grant.
ARTICLE VII
Stock Appreciation Rights
7.1 STOCK APPRECIATION RIGHTS. Subject to the provisions of
the Plan, the Committee shall have sole and complete authority to determine the
Eligible Employees to whom Stock Appreciation Rights shall be granted, the
number of shares of Common Stock to be covered by each Award of Stock
Appreciation Rights, the grant price thereof and the conditions and limitations
applicable to the exercise thereof. Stock Appreciation Rights may be granted in
tandem with another Award, in addition to another Award, or freestanding and
unrelated to any other Award. Stock Appreciation Rights granted in tandem with
or in addition to a Stock Option or other Award may be granted either at the
same time as the Stock Option or other Award or at a later time. Stock
Appreciation Rights shall not be exercisable earlier than six months after the
date of grant nor after the expiration of 10 years after the date of grant.
Except in the case of a Stock Appreciation Right which is a Substitute Award,
the grant price of any Stock Appreciation Right granted under this Plan shall
not be less than 100% of the fair market value of the shares of Common Stock
covered by such Stock Appreciation Right on the date of grant or, in the case of
a Stock Appreciation Right granted in tandem with a then outstanding Stock
Option or other Award, on the date of grant of such related Stock Option or
Award.
7.2 SETTLEMENT. A Stock Appreciation Right shall entitle the
Participant to receive upon exercise, for each share of Common Stock to which
the exercised SAR relates, an amount equal to the excess, if any, of the fair
market value of a share of Common Stock on the date of exercise of the Stock
Appreciation Right over the grant price. Any Stock Appreciation Right shall be
settled in cash, unless the Committee shall determine at the time of grant of a
Stock Appreciation Right that it shall or may be settled in cash, shares of
Common Stock or a combination of cash and such shares.
ARTICLE VIII
Other Stock-Based Awards
8.1 OTHER STOCK-BASED AWARDS. The Committee is hereby
authorized to grant to Eligible Employees an Other Stock-Based Award which shall
consist of an Award, the value of which is based in whole or in part on the
value of shares of Common Stock, which is not an instrument described in
Articles VI or VII of this Plan. Other Stock-Based Awards may be awards of
shares of Common Stock or may be denominated or payable in, valued in whole or
in part by reference to or otherwise based on, or related to, Common Stock (and
securities convertible into or exchangeable for Common Stock) including, without
limitation, Awards valued by reference to subsidiary performance, as deemed by
the Committee to be consistent with the purposes of the Plan. Other Stock-Based
Awards may be granted either in addition to or in tandem with other Awards, or
on a freestanding basis.
<PAGE> 7
Subject to the provisions of this Plan, the Committee shall
have authority to determine the persons to whom and the time or times at which
such Awards shall be made, the number of shares of Common Stock to be awarded
pursuant to such Awards, and all other conditions of the Awards. Except in the
case of an Other Stock-Based Award which is a Substitute Award, the price at
which securities may be purchased pursuant to any Other Stock-Based Award
granted under this Plan, or the provision, if any, of any such Award that is
analogous to the purchase or exercise price, shall not be less than 100% of the
fair market value of the securities to which such Award relates on the date of
grant.
8.2 DIVIDEND EQUIVALENTS. In the sole and complete discretion
of the Committee, an Award, whether made as an Other Stock-Based Award under
this Article VIII or as an Award granted pursuant to Articles VI and VII hereof,
may provide the Participant with dividends or dividend equivalents, payable in
cash, shares of Common Stock, subsidiary securities, other securities or other
property on a current or deferred basis.
ARTICLE IX
Termination or Amendment of the Plan
9.1 AMENDMENTS TO THE PLAN. The Board may amend, suspend or
terminate the Plan or any portion thereof at any time, provided that no
amendment shall be made without stockholder approval if such approval is
necessary to comply with any tax or regulatory requirement, including for these
purposes any approval requirement that is a prerequisite for exemptive relief
from Section 16(b) of the Securities Exchange Act of 1934 or any successor
provision thereto. No such amendment or other action by the Committee shall
impair the rights of any holder of an outstanding Award without the affected
holder's consent. Notwithstanding anything to the contrary contained herein, the
Committee may amend the Plan in such manner as may be necessary for the Plan to
conform with local rules and regulations in any jurisdiction outside the United
States.
9.2 AMENDMENTS TO AWARDS. The Committee may amend, modify or
terminate any outstanding Award with the Participant's consent at any time prior
to payment or exercise in any manner not inconsistent with the terms of the
Plan, including without limitation, (i) to change the date or dates as of which
an Award becomes exercisable, or (ii) to cancel an Award and grant a new Award
in substitution therefor under such different terms and conditions as it
determines in its sole and complete discretion to be appropriate.
9.3 ADJUSTMENT OF AWARDS UPON THE OCCURRENCE OF CERTAIN
UNUSUAL OR NONRECURRING EVENTS. The Committee is hereby authorized to make
adjustments in the terms and conditions of, and the criteria included in, Awards
in recognition of unusual or nonrecurring events (including, without limitation,
the events described in Section 4.2 hereof) affecting the Company, or the
financial statements of the Company or any subsidiary, or of changes in
applicable laws, regulations, or accounting principles, whenever the Committee
determines that such adjustments are appropriate to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available
under the Plan.
9.4 CANCELLATION. Any provision of this Plan or any Award
Agreement to the contrary notwithstanding, the Committee may cause any Award
granted hereunder to be canceled in
<PAGE> 8
consideration of a cash payment or alternative Award made to the holder of such
canceled Award equal in value to such canceled Award. The determinations of
value under this subparagraph shall be made by the Committee in its sole
discretion.
ARTICLE X
General Provisions
10.1 AWARD AGREEMENTS. Each Award hereunder shall be evidenced
by a writing delivered to the Participant that shall specify the terms and
conditions thereof and any rules applicable thereto, including but not limited
to the effect on such Award of the death, retirement or other termination of
employment of the Participant and the effect thereon, if any, of a change in
control of the Company.
10.2 WITHHOLDING. A Participant may be required to pay to the
Company, and the Company shall have the right to deduct from all amounts paid to
a Participant (whether under the Plan or otherwise), any taxes required by law
to be paid or withheld in respect of Awards hereunder to such Participant. The
Committee may provide for additional cash payments to holders of Awards to
defray or offset any tax arising from the grant, vesting, exercise or payment of
any Award.
10.3 NONTRANSFERABILITY. No Award shall be transferable by a
Participant other than by will or the laws of descent and distribution or, to
the maximum extent permitted by Rule 16b-3, pursuant to a qualified domestic
relations order ("QDRO") as determined by the Committee; provided, however, that
an Award may be transferable, to the extent set forth in the applicable Award
Agreement, (i) if such Award Agreement provisions do not disqualify such Award
for exemption under Rule 16b-3, or (ii) if such Award is not intended to qualify
for exemption under such rule.
10.4 SHARE CERTIFICATES. All certificates for Common Stock or
other securities delivered under the Plan pursuant to any Award or the exercise
thereof shall be subject to such stop transfer orders and other restrictions as
the Committee may deem advisable under the Plan or the rules, regulations, and
other requirements of the SEC, any stock exchange upon which such Common Stock
or other securities are then listed, and any applicable federal or state laws,
and the Committee may cause a legend or legends to be put on any such
certificates to make appropriate reference to such restrictions.
10.5 NO LIMIT ON OTHER COMPENSATION ARRANGEMENTS. Nothing
contained in the Plan shall prevent the Company from adopting or continuing in
effect other compensation arrangements, which may, but need not, provide for the
grant of options, stock appreciation rights and other types of Awards provided
for hereunder (subject to stockholder approval of any such arrangement if
approval is required), and such arrangements may be either generally applicable
or applicable only in specific cases.
10.6 NO RIGHT TO EMPLOYMENT. The grant of an Award shall not
be construed as giving a Participant the right to be retained in the employ of
the Company or any subsidiary or in the employ of any other entity providing
services to the Company. The Company or any subsidiary or any such entity may at
any time dismiss a Participant from employment, or terminate any arrangement
pursuant
<PAGE> 9
to which the Participant provides services to the Company, free from any
liability or any claim under the Plan, unless otherwise expressly provided in
the Plan or in any Award Agreement. No Employee, Participant or other person
shall have any claim to be granted any Award, and there is no obligation for
uniformity of treatment of Employees, Participants or holders or beneficiaries
of Awards.
10.7 GOVERNING LAW. The validity, construction, and effect of
the Plan, any rules and regulations relating to the Plan and any Award Agreement
shall be determined in accordance with the laws of the State of Delaware.
10.8 SEVERABILITY. If any provision of the Plan or any Award
is or becomes or is deemed to be invalid, illegal, or unenforceable in any
jurisdiction or as to any Person or Award, or would disqualify the Plan or any
Award under any law deemed applicable by the Committee, such provision shall be
construed or deemed amended to conform to applicable laws, or if it cannot be
construed or deemed amended without, in the determination of the Committee,
materially altering the intent of the Plan or the Award, such provision shall be
stricken as to such jurisdiction, Person or Award and the remainder of the Plan
and any such Award shall remain in full force and effect.
10.9 NO TRUST OR FUND CREATED. Neither the Plan nor any Award
shall create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Company and a Participant or any other
Person. To the extent that any Person acquires a right to receive payments from
the Company pursuant to an Award, such right shall be no greater than the right
of any unsecured general creditor of the Company.
10.10 NO FRACTIONAL SHARES. No fractional shares of Common
Stock shall be issued or delivered pursuant to the Plan or any Award, and the
Committee shall determine whether cash, other securities or other property shall
be paid or transferred in lieu of any fractional shares or whether such
fractional shares or any rights thereto shall be canceled, terminated, or
otherwise eliminated.
10.11 HEADINGS. Headings are given to the Articles, Sections
and subsections of the Plan solely as a convenience to facilitate reference.
Such headings shall not be deemed in any way material or relevant to the
construction or interpretation of the Plan or any provision thereof.
ARTICLE XI
Effective Date of Plan
The Plan shall become effective upon the date specified by the
Board in its resolution adopting the Plan, subject to the approval of the Plan
by the shareholder of the Company.
<PAGE> 10
ARTICLE XII
Term of Plan
No Award shall be granted pursuant to the Plan on or after the
tenth anniversary of the earlier of the date the Plan is adopted or the date of
shareholder approval but Awards granted prior to such tenth anniversary may and
the authority of the Committee to amend, alter, adjust, suspend, discontinue, or
terminate any such Award or to waive any conditions or rights under any such
Award shall, extend beyond that date.
<PAGE> 1
Exhibit 5
[DAVIS POLK & WARDWELL]
August 23, 1996
PriCellular Corporation
45 Rockefeller Plaza
New York, NY 10020
Dear Sirs:
We are acting as special counsel for PriCellular Corporation
(the "Corporation") in connection with its Registration Statement on Form S-8
(the "Registration Statement") to register under the Securities Act of 1933, as
amended, 2,109,375 shares (the "Shares") of Common Stock ($.01 par value) of the
Corporation issuable pursuant to the 1994 Stock Option Plan, as amended (the
"Plan"), of the Corporation. In connection therewith, we have examined originals
or copies, certified or otherwise identified to our satisfaction, of such
documents, corporate records, certificates of public officials and other
instruments as we have deemed necessary for the purpose of this opinion.
Upon the basis of the foregoing, we are of the opinion that
the Shares deliverable pursuant to the Plan have been duly authorized and, when
and to the extent issued pursuant to the Plan upon receipt by the Corporation of
adequate consideration therefor, will be validly issued, fully paid and
nonassessable.
We consent to the filing of this opinion as Exhibit 5 to the
Registration Statement.
Very truly yours,
Davis Polk & Wardwell
<PAGE> 1
EXHIBIT 23(b)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in the
Registration Statement (Form S-8) of PriCellular Corporation pertaining to the
PriCellular Corporation 1994 Stock Option Plan of our report dated January 24,
1996 with respect to the consolidated financial statements and schedules of
PriCellular Corporation, included in its Annual Report (Form 10-K) for the year
ended December 31, 1995 and the Prospectus relating to the offering of
2,500,000 shares of the Company's Class A Common Stock dated July 30, 1996,
filed with the Securities and Exchange Commission.
Ernst & Young LLP
New York, New York
August 22, 1996
