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EXHIBIT 5.4
FORM OF OPINION OF
LUKAS, MCGOWAN, NACE & GUTIERREZ, CHARTERED
June ___, 1996
(202) 828-9475
Lehman Brothers Inc.
Donaldson, Lufkin & Jenrette
Securities Corporation
Chase Securities, Inc.
Toronto Dominion Securities (USA) Inc.
c/o Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285
Re: PCS Development Corporation ("PCSD" or the "Company") --
Issuance of $150,000,000 (Initial Accreted Value) of ______%
Senior Discount Notes (the "Notes") with Warrants (the
"Warrants") to purchase ____ shares of Class B Common Stock
(the Notes and Warrants collectively are referred to herein as
the "Units")
Ladies and Gentlemen:
This opinion is furnished to you in connection with the issuance of
the Units ("Offering") pursuant to the Form S-1 Registration Statement of PCSD,
Registration No. 333-2162, as amended, (the "Form S-1"), as representative of
the several Underwriters named in Schedule 1 to the Underwriting Agreement
entered into with respect to the Units. Unless otherwise indicated,
capitalized terms used in this opinion have the meanings ascribed to them in
the Form S-1.
This firm has acted as communications counsel for the Company. In
connection with the delivery of this opinion, we have examined a copy of the
Form S-1, including all amendments and exhibits filed through the date of this
letter. We have also examined those
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records maintained by the Federal Communications Commission ("FCC") that are
available for public inspection, and such other documents and matters of law as
we have deemed necessary or appropriate for purposes of this opinion. We have
also interviewed appropriate representatives of the Company as we have deemed
reasonably necessary to render this opinion (collectively, "Our Inquiry").
In making Our Inquiry, we have assumed, without independent
verification, the genuineness of all signatures (whether original or
photostatic) and the authenticity of all documents submitted to us as originals
and the conformity to authentic original documents of all documents submitted
to us as certified or photostatic copies. We have also assumed the accuracy
and completeness of the FCC's files. As to all questions of fact material to
this opinion, we have relied solely upon the representations and warranties of
the Company contained in the Underwriting Agreement and made by its
representatives as part of Our Inquiry. We have assumed, without independent
verification, the accuracy of the relevant facts stated therein.
When used in this opinion, the term "our knowledge" refers to the
actual knowledge of the attorneys currently in this firm who have been actively
involved in the Company's representation. Whenever our opinion with respect to
the existence or nonexistence of facts is qualified by the phrase "to our
knowledge," or some similar phrase, it is intended to indicate that no
information has come to the attention of those attorneys in the course of our
representation that would give them actual knowledge that our opinion with
respect to the existence or nonexistence of such facts is inaccurate. We have
not undertaken any independent investigation of the Company or its facilities
to determine the existence or nonexistence of such facts, other than Our
Inquiry identified above. Our opinion, therefore, does not encompass any
matter which would be apparent, inter alia, only as a result of such an
investigation. Whenever our opinion is qualified by the phrase "after Our
Inquiry" or some similar phrase, it is intended to indicate that we undertook
Our Inquiry as described herein, but did not undertake any independent
investigation or evaluation to confirm the accuracy or completeness of the
responses to Our Inquiry. No inference as to our knowledge of the existence or
nonexistence of facts, other than facts of which we have obtained actual
knowledge as a result of our representation, should be drawn from the fact of
our representation of the Company.
This opinion is governed by, and shall be interpreted in accordance
with, the Legal Opinion Accord of the ABA Section of Business Law (1991). As a
consequence, it is subject to a number of qualifications, exceptions,
definitions, limitations on coverage and other limitations, all as more
particularly described in the Accord, and this opinion should be read in
conjunction therewith.
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For the purpose of giving this opinion, we are not admitted in and/or
do not practice in any jurisdiction other than the District of Columbia. This
opinion should not be construed to render an opinion on any matter of state law
with respect to the Company. This opinion is limited solely to matters arising
under the Communications Act of 1934, as amended ("Act"), the FCC's rules,
regulations, and published policies ("Rules"), and we express no opinion
concerning any other law, federal, state or local or of the regulation of any
other federal, state or local agency or administrative body.
Based upon and subject to the foregoing, and subject to the
limitations, qualifications and exceptions set forth herein, we are of the
opinion, to our knowledge, after our Inquiry, that:
1. Exhibit A to this letter is a list of the operating licenses
issued by the FCC to the Company or to the indicated Restricted Subsidiary of
the Company ("FCC Licenses"). The FCC Licenses are in full force and effect
and have not been reversed, stayed, set aside, annulled or suspended. The FCC
Licenses are valid until the expiration date shown on the face of the FCC
Licenses, subject to the construction requirements of 47 C.F.R. Section
24.103(b). The FCC Licenses are the only licenses, permits, authorizations,
consents or approvals required under the Act and the Rules for the construction
and operation of the national narrowband PCS system discussed in the Form S-1
licensed to the Company.
2. No exemption, consent, approval, order or authorization of, or
registration, declaration or filing with, the FCC is required by the Company in
connection with the issuance and sale of the Units, the detaching or exercise
of the Warrants or the Issuance of the Warrant Shares upon the exercise of the
Warrants.
3. Neither the issuance and sale of the Units by the Company, the
detaching or exercise of the Warrants nor the issuance of the Warrant Shares
upon the exercise of the Warrants will result in the application to the Company
of the FCC's unjust enrichment sanctions with respect to the Company's
classification as a small business or a business owned by members of minority
groups and/or women in the FCC's narrowband PCS regional auction, or the
Company's classification as a small business in the FCC's 900 MHz SMR auction,
and after the issuance of the Units the Company will continue to be eligible
for the benefits that accrued to it in those auctions. In arriving at this
opinion, we have relied upon a ruling we obtained from the FCC's Commercial
Wireless Division staff as to whether the FCC would apply the unjust enrichment
provision of Section 24.309(f) should the total equity interest held by the
Control Group in the Company be reduced to less than twenty-five percent (25%)
in connection with the issuance by the Company of its Series A Preferred Stock
(the "Ruling"). We note that private letter rulings concerning the
interpretation of the
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FCC rules made by the FCC's staff are not binding upon the FCC. We
nevertheless have relied on such interpretations as the best available source.
4. There is not now pending or threatened any litigation,
proceeding, inquiry or investigation before the FCC that might result in a
termination, revocation or other material impairment of the FCC Licenses. The
FCC has not issued, or threatened to issue, Notice of Apparent Liability
against the Company.
5. Neither the issuance and sale of the Units, the detaching or
exercise of the Warrants, or the issuance of the Warrant Shares upon the
exercise of the Warrants, nor the consummation of any of the transactions
contemplated by the Form S-1, will contravene any provision of the Act or the
Rules with respect to the FCC Licenses.
6. The statements contained in the Form S-1 under the captions
"Risk Factors - Potential Loss of FCC Financing and Bidding Credits,"
"Business-Spectrum," "Business-Regulation," and "Description of FCC Auction
Benefits" constitute a fair and accurate summary thereof, and we have no reason
to believe that such statements contain any untrue statement of material fact
or omit to state a material fact necessary to make such statement therein not
misleading.
This opinion is being provided to you solely for your use. This
opinion may not be quoted to, copied, delivered to, or relied upon by anyone
other than you in connection with the transaction and for no other purpose
without our prior written consent. It may not be relied upon by any purchaser
of the Units, Warrants or Warrant Shares in the Offering, or any subsequent
purchaser. This opinion is effective only as of the date hereof and we
undertake no professional responsibility to advise you as to any subsequent
event either in the nature of a change of fact or law, as to which we may
become aware. This opinion should not be assumed to state general principles
of law applicable to transactions of this kind. Where opinions may be
expressed or implied concerning the financial effect or possible effect of any
event upon the Company or its business, you should be advised that we have no
particular expertise in such matters, and you rely on such opinion at your
risk.
Very truly yours,
LUKAS, MCGOWAN, NACE & GUTIERREZ,
CHARTERED
By:
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David A. LaFuria