<PAGE>
SCHEDULE 14A
(Rule 14a-101)
Proxy Statement Pursuant to Section 14(a) of The Securities
Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for use of
[x] Definitive Proxy Statement the Commission only
[ ] Definitive Additional Materials (as permitted by Rule 14a-6(e)(2))
[ ] Soliciting Material Pursuant to Rule 14a-ll(c) or Rule 14a-12
PICK Communications Corp.
------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
__________________________________________________________________
(2) Aggregate number of securities to which transaction applies:
__________________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:1
__________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
__________________________________________________________________
(5) Total fee paid:
__________________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-ll(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
__________________________________________________________________
(2) Form, Schedule or Registration Statement No.:
__________________________________________________________________
(3) Filing Party:
__________________________________________________________________
(4) Date Filed:
__________________________________________________________________
<PAGE>
PICK Communications Corp.
----------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on December 11, 1997
----------
To The Stockholders of PICK Communications Corp.:
Notice is hereby given that the Annual Meeting of Stockholders (the
"Annual Meeting") of PICK Communications Corp., a Nevada Company (the
"Company"), will be held at the Company's principal executive offices located at
Wayne Interchange Plaza II, 155 Route 46 West, Wayne, New Jersey 07470, at 11:00
a.m., Eastern Standard Time, on December 11, 1997, for the following purposes:
1. To elect five Directors of the Company to serve for the ensuing
year and until their successors are elected and qualify -
Proposal 1.
2. To consider and act upon a proposal to amend the PICK
Communications Corp. 1996 Stock Option Plan to increase the
number of shares available for issuance upon the exercise of
options granted thereunder from 5,000,000 Shares of Common Stock
to 7,500,000 shares of Common Stock - Proposal 2.
3. To ratify the appointment of Durland & Company, CPAs, P.A. as the
Company's auditors - Proposal 3.
4. To transact such other business as may properly come before the
Annual Meeting or adjournments thereof.
The Board of Directors of the Company has fixed the close of business
on October 17, 1997 as the record date for determining the Stockholders entitled
to notice of and to vote at the Annual Meeting.
By Order of the Board of Directors
Raymond M. Brennan,
Secretary
Wayne, New Jersey
November 14, 1997
IMPORTANT
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE COMPLETE,
SIGN AND DATE THE ENCLOSED PROXY CARD, WHICH IS SOLICITED BY THE COMPANY, AND
RETURN IT TO THE COMPANY. THE PROXY MAY BE REVOKED AT ANY TIME BEFORE IT IS
VOTED, AND STOCKHOLDERS EXECUTING PROXIES MAY ATTEND THE ANNUAL MEETING AND VOTE
THERE IN PERSON SHOULD THEY SO DESIRE.
<PAGE>
PICK Communications Corp.
Wayne Interchange Plaza II
155 Route 46 West
Wayne, New Jersey 07470
(201) 812-7425
----------
Proxy Statement
----------
The Board of Directors of PICK Communications Corp., a Nevada
corporation (the "Company") presents this Proxy Statement and the enclosed Proxy
to all stockholders and solicits their proxies for the Annual Meeting of
Stockholders (the "Annual Meeting"), to be held at the Company's principal
executive offices located at Wayne Interchange Plaza II, 155 Route 46 West,
Wayne, New Jersey 07470, at 11:00 a.m., Eastern Standard Time, on December 11,
1997 for the purposes set forth in the Notice of Annual Meeting of Stockholders
(the "Notice of Meeting"). This Proxy Statement and accompanying Notice of
Meeting, Proxy, Annual Report to the Stockholders for the year ended December
31, 1996 are expected to be mailed commencing on or about November 14, 1997 to
the holders of record of the Company's common stock, par value $ .001 per share
(the "Common Stock") as of the close of business on October 17, 1997 (the
"Record Date"). On the Record Date, there were 36,059,817 shares of Common
Stock outstanding, the only outstanding voting securities of the Company. All
expenses of this solicitation will be borne by the Company.
Each share of Common Stock owned on the Record Date is entitled to one
vote for each matter which may properly come before the Annual Meeting. The
affirmative vote of a majority of the votes cast by holders of Common Stock on
the Record Date present in person or by proxy at the Annual Meeting and entitled
to vote is required to adopt each matter considered at the Meeting. You may use
the enclosed Proxy to indicate your vote as to each of the proposals described
in this Proxy Statement (the "Proposals"). Each Proxy which is properly
completed, signed and returned to the Company prior to the Annual Meeting and
which has not been revoked will be voted at the Meeting and any adjournments
thereof, as specified in such Proxy. If no specifications are given, shares
represented by each properly completed Proxy will be voted "FOR" the election of
the Company's nominees for the Board of Directors set forth in Proposal 1 and
for each other Proposal. Shares represented by Proxies which are marked
"ABSTAIN" as to any Proposal, and Proxies which are marked to deny discretionary
authority on all other matters will not be included in the vote totals and
therefore will have no effect on the voting. In addition, when brokers are
prohibited from exercising discretionary authority for beneficial owners of
shares who have not provided voting instructions (commonly referred to as
"broker non-votes"), those shares will not be included in the vote totals.
The Company does not anticipate that any of its nominees will be
unavailable for election and does not know of any matters other than those
proposed above that may be brought before the Annual Meeting. In the event that
any other matter comes before the Annual Meeting or any nominee is not available
for election, the persons named in the enclosed Proxy will have discretionary
authority
<PAGE>
to vote all Proxies not marked to the contrary with respect to any such matter
in accordance with their best judgment.
A Stockholder may revoke his or her Proxy at any time before it is
exercised by delivering to the Secretary of the Company at its executive offices
in Wayne, New Jersey, either a written notice of revocation or a duly executed
Proxy bearing a later date, or by attending the Annual Meeting and voting in
person.
A list of Stockholders entitled to vote at the Annual Meeting will be
open to examination by any Stockholders, for any purpose germane to the Annual
Meeting, at the Company's executive offices, at the address indicated on the
Notice of Annual Meeting, during ordinary business hours for ten (10) days prior
to the Annual Meeting. This list will also be available for review at the Annual
Meeting.
ACTIONS TO BE TAKEN AT THE ANNUAL MEETING
Proposal 1 - Election of Five (5) Nominees As Directors
The Board of Directors has nominated the five incumbent Directors for
reelection including Marilyn C. Halvorsen who was appointed by the Board in June
1997 to fill the vacancy on the Board of Directors created by the resignation of
Greg Manning as a Director, effective March 10, 1997. Proxies not marked to the
contrary will be voted "FOR" the election of the persons listed below:
<TABLE>
<CAPTION>
Positions with Year First
Name Age the Company Became Director
- ---- --- ----------- ---------------
<S> <C> <C> <C>
Diego Leiva 47 Chairman, Chief Executive 1995
Officer, President, Director
Raymond M. Brennan 60 Vice President, Secretary, Director 1995
Robert R. Sams 59 Director 1995
Ricardo Maranon 53 Director 1995
Marilou C. Halvorsen 32 Director 1997
</TABLE>
Biographical Information about Nominees
Diego Leiva founded Public Info/Comm Kiosk, Inc., a New Jersey
corporation ("PICK"), which is currently a wholly-owned subsidiary of the
Company, in August 1992, and has served as PICK 's Chairman of the Board, Chief
Executive Officer and President since that time. He has held
-2-
<PAGE>
the same positions with the Company since its reorganization pursuant to the
Reorganization Plan (as defined below) in September 1995. From 1989 through July
1992, Mr. Leiva served as Director of Sales for Apertus Technologies, Inc., a
computer telecommunications sales firm. Prior thereto, he was Vice President of
Marketing and Sales for Market Makers, Inc., Chief Operating Officer of Silo,
Inc., and President of Astroglow Lamps Company. See "Certain Relationships and
Related Transactions."
Raymond M. Brennan has served as Vice President and Secretary of PICK
since May 1994 and Director since June 1994. He has held the same positions with
the Company since September 1995. From April 1990 to April 1994, Mr. Brennan
served as Executive Vice President and General Counsel of EOL, Inc., a full
service event production and marketing company. From January 1982 to March 1990,
Mr. Brennan served as Vice President of Business Affairs for Radio City Music
Hall Productions, Inc., where he administered both the Purchasing and Legal
Departments. See "Certain Relationships and Related Transactions."
Robert R. Sams has served as director of the Company since September
1995 and of PICK since November 1994. He has been engaged in merchant banking,
corporate finance, acquisitions and financial advisory services since founding
Saicol Limited in 1983.
Ricardo Maranon has served as director of the Company since September
1995 and of PICK since December 1994. He has served as President of the
Florida-based advertising agency Maranon & Associates Advertising since founding
that company in 1985.
Marilou C. Halvorsen, has served as director of the Company since June
of 1997. She has been Executive Director of the New Jersey Amusement Association
since 1995 and was recently named to the Board of Directors of the New Jersey
Travel Industry Association.
Management has no reason to believe that any of the nominees will not
be a candidate or will be unable to serve. In the event that any nominee should
become unable or unwilling to serve as a Director, however, Proxies will be
voted for the election of any person substituted for such nominee designated by
the incumbent Directors. All Directors of the Company hold office until the next
annual meeting of Stockholders and until their successors are elected and
qualify.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS
VOTE FOR THE ELECTION OF ALL OF ITS NOMINEES AS
DIRECTORS OF THE COMPANY - PROPOSAL 1.
INFORMATION ABOUT THE BOARD OF DIRECTORS,
COMMITTEES OF THE BOARD, AND EXECUTIVE OFFICERS
-3-
<PAGE>
Meetings of The Board of Directors And Information Regarding Committees
Since January 1996, the Company has had two standing committees of the
Board of Directors, the Compensation Committee and the Audit Committee. There
were no committees of the Board of Directors in 1995. Messrs. Maranon and Sams
comprise the Compensation Committee. Among the duties of this Committee are the
making of recommendations to the Board of remuneration for officers and key
sales persons of the Company, the determination of the number and issuance of
stock options and the review of any compensation and incentive programs for
executive officers, consultants and others.
The members of the Audit Committee are Messrs. Leiva and Sams. The
duties of the Audit Committee include recommending the independent public
accountants to serve as the Company's auditors, reviewing and considering
actions of management in matters relating to audit functions, reviewing with
such accountants the scope and results of their audit engagement, reviewing the
financial statements and information included in the Company's filings with the
Securities and Exchange Commission, reviewing the Company's system of internal
controls and procedures and reviewing the effectiveness of procedures intended
to prevent violations of laws and regulations.
The Board of Directors held eight meetings in 1996. All Directors
attended seven meetings. In one meeting, three (a majority) of the Directors
attended. The other two directors were unavailable but they subsequently
approved and ratified the action of the majority.
The Compensation Committee held two meetings in 1996. Both members of
the Compensation Committee attended both meetings.
The Audit Committee held two meetings in 1996. Both members of the
Audit Committee attended both meetings.
Executive Officers
Officers of the Company are elected annually by, and serve at the
discretion of the Board of Directors. The names and business backgrounds of
Executive Officers of the Company and of PICK who are not Directors of the
Company are:
<TABLE>
<CAPTION>
Positions with Year First
Name Age the Company & PICK Became Officer
- ---- --- ------------------ --------------
<S> <C> <C> <C>
Robert Bingham 49 Vice President and Chief 1997
Financial Officer
Karen M. Quinn 49 Vice President of Operations and 1995
Corporate Communications
</TABLE>
-4-
<PAGE>
Robert Bingham has been Vice President and Chief Financial Officer of
the Company since September 17, 1997. He previously served as a director of
Frankel & Topche P.C., CPAs for approximately two years, Vice President and
Chief Financial Officer of Smith Management Company (a privately-held investment
management company) for one year, Vice President Finance of Prime Hospitality
Corp. (a NYSE-listed hotel investment and management company) for seven years
and as an auditor and consultant for Ernst & Young, LLP, Certified Public
Accountants, for nine years.
Karen M. Quinn has been Vice President of Operations and Corporate
Communications of the Company since September 1995. Ms. Quinn has also worked
for PICK since December 1992, having become its Vice President of Operations in
May 1994. Previously, Ms. Quinn was a Business Manager in the health care
industry for 22 years, and Vice-President of Operations at two computer sales
and service companies over a period of six years.
-5-
<PAGE>
EXECUTIVE COMPENSATION
Directors currently receive no cash compensation for serving on the
Board of Directors or any Committee of the Board, other than reimbursement of
travel expenses incurred by them and their spouses in attending Board meetings
held outside the New York Metropolitan area. Two of the Directors are employees
of the Company. Each of the Directors has received restricted stock and stock
options from the Company. Entities affiliated with certain Directors have
received restricted stock and/or stock options and have entered into business
arrangements with the Company. See the notes to "SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT," "SUMMARY COMPENSATION TABLE," "BOARD OF
DIRECTOR INTERLOCKS AND INSIDER PARTICIPATION" and "CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS," all below.
The following table sets forth all compensation awarded to, earned by,
or paid to the Executive Officer named therein for all services rendered to the
Company during the three fiscal years ending December 31, 1996. No other
Executive Officer of the Company received total compensation in excess of
$100,000 during any of the last three years:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
------------------- ----------------------
Awards Payouts
------ -------
Other Restrict- Securities
Annual ed Underlying
Name and Compen- Stock Options/
Principal sation Award(s) SARs
Positions Year Salary ($) Bonus ($) ($) ($) (#)
- --------- ---- ---------- --------- ------- --------- ---
<S> <C> <C> <C> <C> <C> <C>
Diego Leiva 1996 $150,000 $ 0 0 0 0
Chief Executive 1995 $ 93,750(1) $ 0 0 0 0
Officer and 1994 $ 76,523(1) $ 0 0 0 0
Chairman of the
Board of Directors
</TABLE>
- ----------
(1) Mr. Leiva was entitled to compensation of $150,000 in both 1995 and 1994.
The amounts not paid to Mr. Leiva, $56,250 for 1995 and $73,477 for 1994,
or an aggregate of $129,727 were paid in 1996 as follows: (i) on December
3, 1996, the Company and Mr. Leiva agreed to an exchange of $100,000 of
such accrued salary for 400,000 shares of Common Stock of the Company at a
purchase price per share of $.25, the closing asked price per share of
such stock on that date; (ii) the remaining balance of $29,727 in unpaid
salary accrued to Mr. Leiva was paid in cash to Mr. Leiva in 1996.
-6-
<PAGE>
In November 1995, the Company purchased term life insurance
policies in the amount of $100,000 for each of Raymond M. Brennan and Karen M.
Quinn, each of whom are executive officers of the Company. The cost to the
Company of the two policies was $1,054. In September 1996, the Company paid
$1,186 for a $250,000 term life insurance policy for Diego Leiva. The Company
does not currently have, nor during the 1996 fiscal year did it have, any other
long-term incentive plans.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of September 29, 1997, the
number of shares of the Company's outstanding Common Stock beneficially owned by
(i) each Director and nominee for Director of the Company, (ii) each Executive
Officer named under the heading "EXECUTIVE OFFICERS" above, (iii) each
beneficial owner of more than 5% of the Company's Common Stock and (iv) all of
the Company's Executive Officers and Directors as a group:
<TABLE>
<CAPTION>
Name and Address Amount and Nature of
of Beneficial Owner Beneficial Ownership (1) Percentage (2)
- ------------------- ------------------------ --------------
<S> <C> <C>
Diego Leiva(11) 14,722,609(3)(4) 36.3%
Robert R. Sams 915,000(5) 2.2%
Ricardo Maranon 1,076,000(5)(6) 2.7%
Raymond M. Brennan(11) 1,261,500(7)(8) 3.1%
Karen M. Quinn(11) 1,141,250(8) 2.8%
Robert S. Bingham(11) 525,000(9) 1.3%
Marilou C. Halverson 265,000(10) *
</TABLE>
-7-
<PAGE>
<TABLE>
<CAPTION>
Name and Address Amount and Nature of
of Beneficial Owner Beneficial Ownership (1) Percentage (2)
- ------------------- ------------------------ --------------
<S> <C> <C>
Greg Manning 4,112,289(12) 10.1%
775 Passaic Avenue
West Caldwell, New Jersey 07006
All executive officers and directors
as a group (7 persons) 19,906,359 49%
</TABLE>
- ------------
* Less than 1% of the issued and outstanding shares of common stock.
(1) Unless otherwise noted, all shares are beneficially owned and the sole
voting and investment power is held by the person indicated.
(2) Based on 36,059,817 shares outstanding plus 4,500,000 stock options as of
September 29, 1997. Each beneficial owner's percentage ownership is
determined by assuming that options or warrants that are held by such
person and which are convertible or exercisable within sixty (60) days of
such date pursuant to Rule 13d-3 under the Securities Exchange Act of 1934
(the "Exchange Act") have been converted or exercised.
(3) Includes (i) 4,290,000 shares beneficially owned by Mr. Leiva's wife, (ii)
792,000 shares beneficially owned by a trust for Mr. Leiva's son and (iii)
792,000 shares beneficially owned by a trust for Mr. Leiva's daughter.
(4) Includes incentive stock options to purchase up to 131,578 shares of the
Company's Common Stock at $.0.19 per share and 250,000 shares at $0.30 per
share and non-qualified stock options to purchase up to 368,422 shares of
the Company's Common Stock at $0.19 per share pursuant to options under the
Plan.
(5) Includes non-qualified stock options to purchase up to 750,000 shares of
the Company's Common Stock, including 500,000 shares at $0.17 per share and
250,000 shares at $0.27 per shares pursuant to the Plan.
(6) Includes 37,250 shares of the Company's Common Stock beneficially owned by
Mr. Maranon's daughter.
(7) Includes 250,000 shares beneficially owned by Mr. Brennan's wife.
(8) Includes incentive stock options to purchase up to 250,000 shares at $.27
per share and 191,176 shares at $0.17 per share and non-qualified stock
options to purchase up to 308,324 shares at $0.17 per share pursuant to the
Plan.
(9) Includes incentive stock options to purchase up to 250,000 shares at $0.25
per share vesting in 1998; incentive stock options to purchase up to
200,000 shares at $0.50 per share and non-qualified stock options to
purchase up to 50,000 shares vesting in 1999.
(10) Includes non-qualified stock options to purchase up to 250,000 shares at
$0.27 per share pursuant to the Plan.
(11) The address of this person is c/o the Company, 155 Route 46 West, 3rd
Floor, Wayne, New Jersey 07470.
(12) These shares are held by Greg Manning Auctions, Inc. A company of which
Greg Manning, a former director of the Company, is an officer and
stockholder.
-8-
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Compensation Committee of the Board of Directors of the Company
was established in January 1996. No member of the Compensation Committee was an
officer or employee of the Company during the prior year or was formerly an
officer of the Company. None of the Executive Officers of the Company has served
on the Board of Directors or Compensation Committee during the last fiscal year
of any other entity, any of whose officers served either on the Board of
Directors of the Company or on the Compensation Committee of the Company.
Certain Relationships and Related Transactions Involving Members of the
Compensation Committee and Other Directors
On September 12, 1995, Diego Leiva, the founder, Chairman,
President and Chief Executive Officer of Public Info/Comm Kiosk, Inc., a
wholly-owned subsidiary of the Company ("PICK"), and certain members of Mr.
Leiva's family, entered into an Agreement and Plan of Reorganization with the
Company (the "Reorganization Plan") pursuant to which Mr. Leiva and his family
members exchanged an aggregate of 701,000 shares of common stock of PICK owned
by them ("PICK Common") for 11,566,500 shares of the Company's Common Stock, or
16.5 shares of the Company's Common Stock for each share of PICK Common. The
Reorganization Plan further provided for PICK to undertake to cause its
remaining stockholders to exchange each of their shares of PICK Common for
shares of the Company's Common Stock in the same ratio as Mr. Leiva's exchange
(the "PICK Exchange"). The PICK Exchange commenced in October 1995, and all
former PICK stockholders exchanged their shares.
On January 25, 1996, the Company's Board of Directors approved the
reservation of 5,000,000 shares of Common Stock for the granting of stock
options to the Company's Directors, officers and employees and certain
consultants under the 1996 Stock Option Plan. The original options were
regranted on September 30, 1996 and subsequently regranted on July 9, 1997. In
addition, the Company granted additional options to officers and Directors on
June 2, 1997. All of the stock options are exercisable as of the day of grant
and expire in three years.
On January 3, 1996, the Company's Board of Directors transferred to
Mr. Leiva the right held by a consultant to purchase 1,500,000 shares of Common
Stock for $.055 per share, or an aggregate of $82,500, upon the consultant's
failure to pay for the shares.
During the years ended December 31, 1993 and December 31, 1994,
Diego Leiva, the Company's President and Chief Executive Officer, advanced
$52,035 and $114,500, respectively, to PICK . The Company repaid $9,500 in 1994
and $3,035 in 1995.
Mr. Leiva was entitled to receive a salary of $150,000 for 1995 and
1994, and $125,000 for 1993, but he waived all of his salary for 1993. Of the
sums due to Mr. Leiva for 1995 and 1994, Mr. Leiva has received $93,750 and
$76,523, respectively. The aggregate balance of $129,727 ($56,250 for 1995 and
$73,477 for 1994) was paid in 1996 as follows: On December 3, 1996, the Company
and Mr. Leiva entered into an agreement to exchange $100,000 of Mr. Leiva's
accrued and unpaid
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<PAGE>
compensation for 1994 and 1995 for 400,000 shares of the Company's Common Stock,
at a price per share of $.25, the closing asked price per share on that date.
The remaining balance of $29,697 in unpaid salary accrued to Mr. Leiva was paid
in cash to Mr. Leiva in 1996.
Pursuant to the terms of the PICK Exchange, in addition to the
shares received by Mr. Leiva and certain members of Mr. Leiva's immediate
family, as described above, Raymond M. Brennan, Vice President, Secretary and a
Director of PICK and the Company, received 511,500 shares of Common Stock of the
Company, including 250,000 shares beneficially owned by his wife, and Robert R.
Sams, a Director of the Company and the Compensation Committee since September
1995 and a Director of PICK since November 1994, received 165,000 shares of such
Common Stock.
In 1994 and 1995, the Company purchased approximately $144,000 and
$10,500, respectively, in advertising services from a company owned and
controlled by Ricardo Maranon, who became a stockholder of the Company and a
member of its Board of Directors in 1995.
In January 1996, the Company issued 150,000 shares of the Company's
Common Stock to All Florida Advertising, Inc., a company of which Mr. Maranon is
the President, for the development and implementation of the advertising and
marketing programs to be instituted by the Company in order to utilize
$3,000,000 worth of prepaid advertising which the Company acquired from
International Executive Services, Inc.
Ricardo Maranon, a Director and of the Company since 1995, received
288,750 shares of Common Stock on September 12, 1995 in connection with the PICK
Exchange.
As of October 17, 1997, the Company owed Raymond Brennan a total of
$35,250 for unpaid 1995 salary.
As of October 17, 1997, the Company owed Mr. Leiva $170,000 for
loans advanced to the Company.
Report of the Compensation Committee of the
Board of Directors on Executive Compensation.
Executive Compensation Policy
It was the responsibility of the Compensation Committee of the
Board of Directors to review the compensation levels and performance of
management and to recommend compensation changes during 1996. The Report of the
Compensation Committee of the Board of Directors concerning executive
compensation appears below:
Philosophy. The Committee believes that maximizing shareholder
value is the most important measure of success, and achieving this depends on
the coordinated efforts of individual employees working as a team toward defined
common performance goals. The objectives of the Company's compensation program
are to align executive compensation with shareholder value, to reward
-10-
<PAGE>
individual and team effort and performance furthering the Company's business
goals and to attract, retain and reward employees who will contribute to the
long-term success of the Company.
The total direct compensation package for the Company's executives,
including the Chief Executive Officer, is intended to be made up of 3 elements:
(i) a competitive base salary; (ii) attractive short-term incentives to
executives to earn additional bonus income based on operating results; and (iii)
the grant of stock options, from time to time, to executives in an effort to
provide a closer identification of the executives' interests with those of the
Company and its shareholders by giving the executives an opportunity to acquire
a proprietary interest in the Company by acquiring Common Stock.
Salaries; Chief Executive Officer. The salaries of the Company's
executive officers for 1996 were fixed by the Committee. The Board believes,
however, that the basic philosophy to be followed regarding salaries is to
consider increases based upon a favorable evaluation of individual performance
relative to individual goals, the functioning of the executive's team within the
corporate structure, success in furthering the corporate strategy and goals, and
individual management skills, responsibilities and anticipated workload. The
Board has also considered demonstrated loyalty and commitment to the Company and
the competitive salaries offered by similar companies to attract executives,
including executives of huge technology companies and those in the
telecommunications industry. Merit increases for executives are to be subject to
the same budgetary guidelines as apply to all other employees of the Company. In
addition, the Board has made grants of restricted shares of Common Stock to its
Chief Executive Officer, Mr. Leiva, partly as a means of rewarding him for
agreeing to the accrual of a portion of his salary for 1995 and 1994 and partly
as a short term means of compensating Mr. Leiva for his services in a manner
designed to maximize available cash flow of the Company.
Bonuses. The Board believes that grants of cash bonus incentives
should be made as a significant percentage of each executive's base salary when
the Company achieves its target goals and when cash flow of the Company is
sufficient to support such grants. This policy is also designed to motivate
individuals to improve performance. No cash bonuses have been awarded to any
executives since January 1, 1995. The Board has authorized, however, grants of
restricted Common Stock and stock options. See "Stock Options" below.
Stock Options. Executives and other employees are eligible for
annual stock option grants under the 1996 Stock Option Plan of the Company. The
number of options granted to any individual depends on individual performance,
salary level and competitive data, and the impact that such employee's
productivity may make to shareholder value over time. In addition, in
determining the number of stock options granted to each executive, the Board
considers the unvested options of each executive to determine the future
benefits potentially available to the executive, each executive's salary in
relation to salaries paid in the industry to persons in positions of equal
responsibility, and the extent to which any executive has waived all or portions
of his salary altogether or waived timely payment, as in the case of Mr. Leiva,
the Company's Chief Executive Officer. The number of options granted to any
executive will depend in part on the total number of unvested options deemed
necessary to provide an incentive to that executive to make a long term
commitment to remain with
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<PAGE>
the Company. By giving to executives an equity interest in the Company, the
value of which depends upon stock performance, the policy seeks to further align
management and shareholder interests.
Respectfully submitted,
The Members of the Compensation Committee:
Robert R. Sams
Ricardo Maranon
Stock Performance Graph
The following graph compares on a cumulative basis the yearly
percentage change, since the Company's Common Stock commenced public trading on
March 19, 1996 in (a) the total shareholder return on the Company's Common Stock
with (b) the total return on the Standard & Poor's 500 Composite Index ("S&P
500") and (c) the total return on a"selected peer group index (the "1996 Peer
Group"). The S&P 500 has been selected as the required broad entity market
index. The 1996 Peer Group is an index weighted by the relative market
capitalization of the following five companies which were selected for being in
related industries to the Company's (telecommunications), for having revenues
between $12,121,000 and $139,621,000 million in their most recently reported
fiscal years and for having 5 year compound annual revenue growth of at
least 10%. The five are: Global Telecomm Solutions, GST Telecomm Inc.,
IDT Corp., Trescom International Inc., and Viatel Inc.
The following graph assumes that $100 has been invested in each of
PICK Communications Corp., the S&P 500, and the 5-member Peer Group on
March 19, 1996.
Comparison of Cumulative Total Return among PICK
Communications Corp., S&P 500 Index and Peer Group.
[Graph omitted, plotting the following points]
<TABLE>
<CAPTION>
MEASUREMENT PERIOD PICK COMMUNICATIONS S&P 500 INDEX PEER GROUP
<S> <C> <C> <C>
March 19, 1996 100 100 100
December 31, 1996 4 88 70
October 31, 1997 8 102 99
</TABLE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In addition to those transactions disclosed above under the caption
"Certain Relationships and Related Transactions Involving Members of the
Compensation Committee and other Directors", the following transactions were
entered into between the Company and either certain members of management or
certain beneficial owners of the Company's Common Stock:
On January 25, 1996, the Board of Directors of the Company adopted
the 1996 Employee Stock Option Plan (the "1996 Option Plan"). The 1996 Option
Plan was approved by the Stockholders of the Company in January 1997. The 1996
Option Plan authorizes the Company to issue up to 5,000,000 shares of its Common
Stock, subject to adjustment in the event of changes in the Company's
capitalization. In June, July and September 1997 the Company granted the
following options to directors and officers:
<TABLE>
<CAPTION>
Incentive Options/ Non-Qualifying
Name and Relationship Exercise Price Options/Exercise Price
- --------------------- -------------- ----------------------
<S> <C> <C>
Diego Leiva, President, Chairman 131,578/$0.19 368,422/$0.19
250,000/$0.30
</TABLE>
-12-
<PAGE>
<TABLE>
<CAPTION>
Incentive Options/ Non-Qualifying
Name and Relationship Exercise Price Options/Exercise Price
- --------------------- -------------- ----------------------
<S> <C> <C>
Raymond M.. Brennan, Vice President and 191,176/$0.17 308,824/$0.17
Director 250,000$0.27
Karen M.. Quinn, Vice President 191,176/$0.17 308,824/$0.17
250,000/$0.27
Robert Bingham, Chief Financial Officer 250,000/$.025 50,000/$0.50
250,000$0.50
Robert R. Sams, Director 0/0 500,000/$0.17
250,000/$0.27
Ricardo. Maranon, Director 0/0 500,000/$0.17
250,000/$0.27
Marilou C. Halvorsen, Director 0/0 250,000/$0.27
</TABLE>
As of November 7, 1997 no options have been exercised.
Pursuant to the terms of the PICK Exchange, in addition to the shares
received by Mr. Leiva, certain members of Mr. Leiva's immediate family, and Mr.
Brennan, as described above under the heading "Certain Relationships and Related
Transactions Involving Members of the Compensation Committee and other
Directors" and Karen M. Quinn, Vice President of Corporate Communications and
Operations of PICK and the Company received 371,250 shares of Common Stock.
On September 15, 1997, the Company issued 25,000 shares of restricted
stock at a price of $0.21 per share to Robert S. Bingham, Vice President and
Chief Financial Officer.
THE BOARD OF DIRECTORS RECOMMENDS THAT
STOCKHOLDERS VOTE "FOR" THE ELECTION OF THE
NOMINEES NAMED ABOVE - PROPOSAL 1.
Proposal 2 - To Amend the Company's 1996 Employee Stock Option Plan to Increase
the Number of Shares Available for Issuance Upon the Exercise of
Options Granted Thereunder
On September 8, 1997, the Board of Directors of the Company adopted an
amendment to the PICK Communications Corp. 1996 Employee Stock Option Plan (the
"Plan") to increase the number of shares of Common Stock that may be issued
pursuant to the Plan from 5,000,000 shares to 7,500,000 shares. This increase in
the number of authorized shares is subject to approval by the Company's
stockholders.
-13-
<PAGE>
The Board of Directors has deemed it in the best interest of the
Company to establish the Plan so as to provide employees and other persons
involved in the continuing development and success of the Company and its
subsidiaries an opportunity to acquire a proprietary interest in the Company by
means of grants of options to purchase Common Stock. It is the opinion of the
Board of Directors that by providing the Company's employees and other
individuals contributing to the Company and its subsidiaries the opportunity to
acquire an equity investment in the Company, the Plan will maintain and
strengthen their desire to remain with the Company, stimulate their efforts on
the Company's behalf, and also attract other qualified personnel to the
Company's employ.
The affirmative vote of a majority of the outstanding voting securities
is required for approval of the amendment to the Plan to increase the number of
authorized shares. If the amendment is not approved, the Company will be limited
to granting options to purchase a maximum of 5,000,000 shares of Common Stock
under the Plan. The Board recommends a vote in favor of approval of the
amendment to the Plan.
SUMMARY OF THE 1996 STOCK OPTION PLAN
The following discussion, which summarizes certain provisions of the
1996 Option Plan, is qualified in its entirety by reference to the text of the
Plan. Copies of the 1996 Option Plan are available for examination at the
Securities and Exchange Commission and at the principal executive offices of the
Company at Wayne Interchange Plaza II, 155 Route 46 West, Wayne, New Jersey
07470.
Eligibility for Participation
Under the 1996 Option Plan, ISOs or ISOs in tandem with SARs which are
subject to the requirements set forth in Temp. Reg. Section 14a.422A-1, A-39
(a)-(e), may be granted, from time to time, to officers and other employees of
the Company. Options, other than ISOs, may also be granted under the 1996 Option
Plan to employees, officers and/or directors of the Company, as well as
independent contractors, consultants and other individuals who are not employees
of, but are involved in the continuing development of the Company's business
("Participants"). As of the date of this Proxy Statement, the Company and its
subsidiaries have 14 employees, two of whom are directors, three outside
directors and five consultants that are eligible for grants under the 1996
Option Plan.
Administration
The 1996 Option Plan is to be administered by the Board of Directors of
the Company or the Compensation Committee of the Board of Directors (the
"Committee"), which may not contain fewer than two non-employee directors (as
defined in Rule 16b-3 promulgated under Section 16 of the Exchange Act). The
Board of Directors or the Committee will have the authority, in its discretion,
to determine the persons to whom options shall be granted, the character of such
options, the manner of exercising and making payment for shares of Common Stock
and the number of shares
-14-
<PAGE>
of Common Stock to be subject to each option. The 1996 Option Plan is currently
administered by the entire Board of Directors.
Terms of Options
The terms of Options granted are to be determined by the Board or the
Committee. Options must be granted within ten years from the date the 1996
Option Plan was adopted or the date the 1996 Option Plan is approved by the
Stockholders of the Company, whichever is earlier. Each Option is to be
evidenced by a stock option agreement between the Company and the Participant,
and is subject to the following additional terms and conditions:
(a) Exercise of the Option. The Board of Directors or the Committee
shall determine the time periods during which Options may be exercised. Options
will be exercisable in whole or in part at any time prior to expiration, but may
not expire later than ten years from the date of grant. If an ISO or an SAR
granted in tandem with an ISO is granted to an individual who, immediately
before the grant owns directly, or through attribution, more than 10% of the
total combined voting power of all classes of capital stock of the Company or a
subsidiary or parent of the Company, such ISO or SAR granted in tandem with an
ISO shall not be exercisable after the expiration of five years from the date of
grant. Unless otherwise provided in any option agreement issued under the 1996
Option Plan, any Option granted under the 1996 Option Plan may be exercisable in
whole or in part at any time during the exercise period and must become fully
exercisable within five years from the date of its grant. In addition, no less
than 20% of an Option may become exercisable in any of the first five years of
the Option. An Option is exercised by the Participant's giving written notice of
exercise to the Company specifying the number of full shares of Common Stock to
be purchased and tendering payment of the purchase price to the Company in cash
or certified check, or, at the discretion of the Board or the Committee, by
delivery of shares of Common Stock having a fair market value equal to the
option price.
(b) Option Price. The option price of an NQSO or an SAR in tandem with
an NQSO granted pursuant to the 1996 Option Plan is determined by the Board of
Directors or the Committee in its sole discretion. In no event may the option
price of an ISO be less than the fair market value on the date of grant. Such
fair market value of an ISO shall be determined by the Board of Directors or the
Committee and, if the shares of Common Stock are listed on a national securities
exchange or traded in the over-the-counter market, the fair market value shall
be the closing price on such exchange, or the mean of the reported bid and asked
prices of the Common Stock in the over-the-counter market as reported by NASDAQ,
the OTC Bulletin Board or the National Quotation Bureau, Incorporated, as the
case may be, on such date. ISOs or SARs granted in tandem with ISOs to holders
of more than 10% of the Company's Common Stock are subject to the additional
restriction that the option price must be at least 110% of the fair market value
of the Company's Common Stock on the date of grant.
(c) Vesting. The Board of Directors or the Committee will determine the
time or times the Options become exercisable, The 1996 Option Plan provides,
however, that with respect to holders of more than 10% of the Common Stock, such
Options must become fully exercisable initially not
-15-
<PAGE>
later than five years from the date of grant, and no less than 20% of the shares
subject to an Option must become exercisable in each of the first five years of
the Option until fully exercisable.
(d) Termination of Employment; Death. Except as provided in the 1996
Option Plan or as otherwise determined by the Board of Directors or the
Committee in its sole discretion, upon termination of employment with the
Company for any reason, a Participant may exercise any of its Options to the
extent it was exercisable as of the date of termination or at any time within
three months after the date of such termination, unless, however, the Board of
Directors or the Committee determines otherwise, in its sole discretion, any
Options granted under the 1996 Option Plan shall immediately terminate in the
event the Participant is convicted of a felony committed against the Company or
any of its subsidiaries.
If the holder of an Option dies while employed by the Company or a
subsidiary or parent corporation of the Company or within three (3) months after
the termination of such holder's employment, such Option may be exercised by a
legatee or legatees of such holder under such individual's last will or by such
individual's death, to the extent such Option was exercisable as of the date of
death or date of termination of employment, whichever date is earlier.
If the holder of an Option becomes disabled within the definition of
Section 22(e)(3) of the Code while employed by the Company or a subsidiary or
parent corporation of the Company, such Option may be exercised at any time
within six months after termination of such holder's employment due to the
disability.
Except as otherwise determined by the Board of Directors or the
Committee in its sole discretion, an Option may not be exercised except to the
extent that the holder was entitled to exercise the Option at the time of
termination of employment or death, and in any event it may not be exercised
after the original expiration date of the Option.
(e) Nontransferability of Options; No Liens. Options are
nontransferable and non-assignable except by will or the laws of intestacy, and
any ISO or SAR in tandem with an ISO is exercisable during the lifetime of the
Participant and only by the Participant, or in the event of his or her death, by
a person who acquires the right to exercise the Option by bequest or inheritance
or by reason of the death of the Participant.
(f) Maximum Number of ISOs or SARs in Tandem with ISOs Which May Be
Issued. A maximum aggregate fair market value of $100,000, determined as of the
time any ISO or SAR in tandem with an ISO is granted and in the manner provided
in the 1996 Option Plan, may not be exceeded as the maximum aggregate value of
(A) the Common Stock with respect to which ISOs and/or SARs in tandem with ISOs
granted under the 1996 Option Plan are exercisable for the first time during any
calendar year, together with (B) the Common Stock with respect to which ISOs
and/or SARs in tandem with ISOs granted under ISOs qualifying as such in
accordance with Section 422 of the Code were granted under any other incentive
stock option plan maintained by the Company or its parent or subsidiary
corporations.
-16-
<PAGE>
An option agreement issued under the 1996 Option Plan may contain such
other terms, provisions and conditions not inconsistent therewith as may be
determined by the Board of Directors or the Committee.
Termination, Modification and Amendment
The 1996 Option Plan shall terminate ten years from the earlier of the
date of its adoption by the Board of Directors or the date of ratification by
the Stockholders of the Company. No Options will be granted after termination of
the 1996 Option Plan.
The Board of Directors of the Company may terminate the 1996 Option
Plan at any time prior to its expiration date, or such modifications or
amendments thereto from time to time as the Board may deem advisable. The Board
may not, however, without the approval of a majority of the then outstanding
shares of the Company entitled to vote thereon, except under conditions
described under "Adjustments Upon Changes in Capitalization," increase the
maximum number of shares as to which Options may be granted under the 1996
Option Plan or materially change the standards of eligibility thereunder.
No termination, modification or amendment to the 1996 Option Plan may
adversely affect the terms of any outstanding Options without the consent of the
holders thereof.
Adjustments Upon Changes in Capitalization
In the event that the number of outstanding shares of Common Stock is
changed by reason of recapitalization, reclassification, stock split, stock
dividend, combination, exchange of shares, or the like, the Board of Directors
of the Company will make an appropriate adjustment in the aggregate number of
shares of Common Stock available and reserved for issuance upon the exercise of
then outstanding Options and in the exercise prices of such Options. Any
adjustment in the number of shares will apply proportionately only to the
unexercised portion of Options granted under the 1996 Option Plan. Fractions of
shares resulting from any such adjustment shall be further adjusted to the next
higher whole number of shares.
In the event of the proposed dissolution or liquidation of
substantially all of the assets of the Company, all outstanding Options will
automatically terminate, unless otherwise provided by the Board.
Federal Income Tax Consequences
The following discussion is only a summary of the principal Federal
income tax consequences of the grant and exercise of Options and is based on
existing Federal law, which is subject to change, in some cases retroactively.
This discussion is also qualified by the particular circumstances of each
Participant which may substantially alter or modify the Federal income tax
consequences herein discussed.
-17-
<PAGE>
Generally, under current law, when an Option qualifies as an ISO under
Section 422 of the Code, (i) an employee will not realize taxable income either
upon the grant or the exercise of the Option, (ii) the amount by which the fair
market value of the shares acquired upon exercise of the Option at the time of
exercise exceeds the option price is included in determining a Participant's
alternative minimum tax, (iii) any gain or loss (the difference between the net
proceeds received upon the disposition of the shares and the Option Price paid
therefor), upon a qualifying disposition of the shares acquired by exercise of
an Option will be treated as a capital gain or loss if the shares qualify as a
capital asset in the hands of the Participant, and (iv) no deduction will be
allowed to the Company for Federal income tax purposes in connection with the
grant or exercise of an ISO or a qualifying disposition of shares. A disposition
by an employee of shares acquired upon exercise of an ISO will constitute a
qualifying disposition if the disposition occurs more than two years after the
grant of the Option and more than one year after the issuance of the shares to
the employee. If such shares are disposed of by the employee before the
expiration of those time limits, the transfer would be a "disqualifying
disposition" and the employee will typically recognize ordinary income (and the
Company will receive an equivalent deduction) equal to the lesser of (i) the
aggregate fair market value of the shares as of the date of exercise less the
Option Price, and (ii) the amount realized on the disqualifying disposition less
the Option Price. Ordinary income from a disqualifying disposition will also
constitute compensation for which withholding may be required under Federal and
state law. The maximum Federal tax rate on ordinary income is greater than the
Federal tax rate for long-term capital gains. Proposals have been made to
decrease the marginal tax rate further on certain types of capital gains. In
addition, holders of Options granted after August 10, 1993 may be entitled to
exclude up to 50% of the gain on any such sale occurring five years after the
date of exercise. The availability of such exclusion is dependent upon whether
the Company (i) does not have more than $50 million of aggregate gross assets at
any time before the exercise of the Options, (ii) is in the trade or business of
operating hotels, motels, restaurants or similar business; or (iii) is in a
trade or business where the principal asset is the reputation or skill of one or
more of its employees. It is unknown whether any capital gains recognized on a
disposition would be of a type entitled to the exclusion referred to in the
preceding sentence, and if not, whether the Federal tax rate on such gains would
be increased. To the extent that a portion of such gain would be is so excluded,
one-half of the excluded gain would be a tax preference for purposes of
computing the alternative minimum tax. No assurance can be given as to when, if
ever, new Federal tax legislation will be enacted into law, and the effective
date of any such legislation.
In the case of an NQSO granted under the Plan, generally no income is
recognized by the Participant at the time of the grant of the Option assuming
such NQSO does not have a readily ascertainable fair market value. The
Participant generally will recognize ordinary income upon exercise of an NQSO
equal to the aggregate fair market value of the shares acquired less the Option
Price. Withholding may be required, and the Company will receive an equivalent
deduction, subject to the provisions of Section 162(m) of the Code relating to
excessive employee remuneration. Section 162(m) disallows a deduction for an
employer with respect to remuneration paid in any taxable year to an executive
officer in excess of $1,000,000. For purposes of determining remuneration paid,
the excess of the fair market value of the Common Stock received upon exercise
of an NQSO over the exercise price is considered remuneration paid in the year
of exercise unless the income is considered performance-based compensation. For
such renumeration to qualify as
-18-
<PAGE>
performance-based compensation, the plan must specify the maximum number of
Shares which a Participant may be entitled to receive upon exercise of Options.
As the 1996 Option Plan does not specify such a limitation, NQSOs granted under
the Plan will not be considered performance-based compensation.
Shares acquired upon exercise of an NQSO will have a tax basis equal to
their fair market value on the exercise date or other relevant date on which
ordinary income is recognized and the holding period for the shares generally
will begin on the date of exercise or such other relevant date. Upon subsequent
disposition of the shares, a Participant will recognize capital gain or loss if
the shares constitute a capital asset in the Participant's hands. Provided the
shares are held by the Participant for more than one year prior to disposition,
such gain or loss will be realized as long-term capital gain or loss. As set
forth above, the maximum federal tax rate on ordinary income is currently
greater than the maximum federal tax rate on long-term capital gains. To the
extent a Participant recognizes a capital loss, such loss generally may offset
capital gains and up to $3,000 of ordinary income. Any excess capital loss may
be carried forward indefinitely.
The grant of an SAR is generally not a taxable event for an Optionee.
Upon the exercise of an SAR, however, the Optionee will recognize ordinary
income in an amount equal to the amount of cash and the fair market value of any
Common Stock received upon such exercise, and the Company will be entitled to a
deduction equal in amount.
Notwithstanding the above, if the sale of any shares received upon the
exercise of an NQSO or an SAR in tandem with an NQSO would be subject to Section
16(b) of the Exchange Act, recognition by the Optionee of ordinary income
attributable to such shares received will be deferred until the date such sale
can be made without application of Section 16(b). However, such shares will be
valued at the fair market value at such later time, unless within 30 days after
the date of exercise, such Optionee elects, under Section 83(b) of the Code, to
recognize ordinary income as of the date of exercise based on the fair market
value at such date.
The foregoing discussion is only a brief summary of the applicable
Federal income tax laws as in effect on this date and should not be relied upon
as being a complete treatment thereof. The Federal tax laws are complex, and
they are subject to legislative changes and new or revised judicial and
administrative interpretations at any time. In addition to the Federal income
tax consequences described herein, a Participant may also be subject to state
and/or local income tax consequences in the jurisdiction in which the
Participant works and/or resides.
The affirmative vote of the majority of shares entitled to vote at the
Annual Meeting is required to ratify the adoption of the Plan.
THE BOARD OF DIRECTORS RECOMMENDS THAT
STOCKHOLDERS VOTE "FOR" THE AMENDENT TO THE
COMPANY'S 1996 STOCK OPTION PLAN - PROPOSAL 2.
Proposal 3 - Ratification of Appointment of Auditors.
-19-
<PAGE>
Durland & Company, CPA,s, P.A. has been the independent public
accountants of the Company since the Company's 1995 fiscal year. They have no
financial interest, either direct or indirect, in the Company. Selection of
independent public accountants is made by the Audit Committee of the Company's
Board of Directors and is approved by the entire Board of Directors, subject to
Shareholder ratification. A representative of Durland & Company CPAs, P.A. is
expected to attend the Annual Meeting and to have an opportunity to make a
statement or respond to appropriate questions from Stockholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS
VOTE "FOR" RATIFICATION OF THE APPOINTMENT OF
DURLAND & COMPANY, CPAs, P.A. AS THE
COMPANY'S AUDITORS - PROPOSAL 3.
OTHER MATTERS
The Board of Directors is not aware of any matters to be presented at
the 1997 Meeting except those matters described in this Proxy Statement. Unless
otherwise directed, all shares represented by Proxies will be voted in favor of
Proposals 1 through 3 described in this Proxy Statement and the Notice. If any
other matters come before the 1997 Meeting, the persons named in the
accompanying Proxies will vote on those matters according to their best
judgment.
BENEFICIAL OWNERSHIP REPORTING COMPLIANCE 16(a)
Section 16(a) of the Exchange Act requires the Company's officers
and Directors and persons who own beneficially more than ten percent of a
registered class of the Company's equity securities (10% Stockholders) to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission. Officers, Directors and 10% Stockholders are required by regulation
to furnish the Company with copies of all forms filed by them pursuant to
Section 16(a).
Based solely on its review of the copis of such forms received by
it, or written representations from certain reporting persons that no Form 5
were required for those persons, the Company believes that, during the period
from January 1, 1996 through December 31, 1996, all filing requirements
applicable to its officers, directors and greater than ten percent beneficial
owners were complied with.
EXPENSES
The entire cost of preparing, assembling, printing and mailing
this Proxy Statement, the enclosed Notice, Proxy and Annual Report, materials,
and the cost of soliciting Proxies with respect to the Annual Meeting, will be
borne by the Company. The Company will request banks and brokers to solicit
their customers who beneficially own shares of Common Stock listed of record in
the names
-20-
<PAGE>
of such banks or brokers as nominees, and will reimburse those banks and brokers
for the reasonable out-of-pocket expenses of such solicitations. The original
solicitation of Proxies will be undertaken by mail, and may be supplemented by
officers and other employees of the Company, using telephone calls and telegrams
but no additional compensation will be paid to them.
STOCKHOLDER PROPOSALS
No person who intends to present a proposal for action at a
forthcoming Stockholders' meeting of the Company's Stockholders may seek to have
such proposal included in the proxy statement or form of proxy for such meeting
unless that person (i) is a beneficial owner of record of at least 1% of the
Common Stock outstanding at the Record Date or $1,000 in market value of Common
Stock, has held such shares for at least one year at the time the proposal is
submitted and continues to own such shares through the date of the meeting, (ii)
provides the Company in writing with his name, address, the number of shares
held by him and the dates upon which he acquired such shares with documentary
support for a claim of beneficial ownership, (iii) notifies the Company of his
intention to appear personally at the meeting or by a representative qualified
under Nevada law to present his proposal for action and (iv) submits his
proposal timely. To be included in the proxy statement or proxy for the
Company's next annual meeting of Stockholders, a proposal must be received at
the Company's principal executive office no later than July 14, 1998. If the
date of such meeting is changed by more than 30 calendar days from the date such
meeting is scheduled to be held under the Company's By-Laws, or if the proposal
is to be presented at any meeting other than the next annual meeting of
stockholders, the proposal must be received at the Company's principal executive
offices at a reasonable time before proxies are solicited for such meeting.
A person may submit only one proposal of not more than 500 words,
along with a supporting statement if the proponent requests inclusion of such a
statement with the proxy materials, and under certain circumstances enumerated
in the rules of the Securities and Exchange Commission relating to the
solicitation of proxies, the Company may be entitled to omit the proposal and
any statement in support thereof from its proxy statement and form of proxy.
Request for Annual and Quarterly Reports
Copies of the Company's Annual Report for the fiscal year ended
December 31, 1996 as filed with the Securities and Exchange Commission and
including the financial statements, accompany these proxy materials.
By Order of the Board of Directors
Raymond M. Brennan,
Secretary
Wayne, New Jersey
November 14, 1997
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<PAGE>
Annex A
PICK COMMUNICATIONS CORP.
1996 STOCK OPTION PLAN
1. Purposes.
The PICK Communications Corp. 1996 Stock Option Plan (the "Plan") is
intended to provide the employees, directors, independent contractors and
consultants of PICK Communications Corp., a Nevada corporation (the "Company"),
with an added incentive to commence employment with the Company, continue their
services to the Company and to induce them to exert their maximum efforts toward
the Company's success. By thus encouraging employees, directors, independent
contractors and consultants and promoting their continued association with the
Company, the Plan may be expected to benefit the Company and its stockholders.
The Plan allows the Company to grant Incentive Stock Options ("ISOs") (as
defined in Section 422(b) of the Internal Revenue Code of 1986, as amended (the
"Code"), Non-Qualified Stock Options ("NQSOs") not intended to qualify under
Section 422(b) of the Code and Stock Appreciation Rights ("SARs") (collectively
the "Options").
2. Shares Subject to the Plan.
The total number of shares of the Company's common stock, $.001 par
value per share (the "Common Stock"), that may be subject to Options granted
under the Plan shall be 5,000,000 in the aggregate, subject to adjustment as
provided in Paragraph 8 of the Plan; however, the grant of an ISO to an employee
together with a tandem SAR or any NQSO to an employee together with a tandem SAR
shall only require one share of Common Stock available subject to the Plan to
satisfy such joint Option. The Company shall at all times while the Plan is in
force reserve such number of shares of Common Stock as will be sufficient to
satisfy the requirement of outstanding Options granted under the Plan. In the
event any Option granted under the Plan shall expire or terminate for any reason
without having been exercised in full or shall cease for any reason to be
exercisable in whole or in part, the unpurchased shares subject thereto shall
again be available for granting of Options under the Plan.
3. Eligibility.
ISO's or ISO's in tandem with SAR's (provided the SAR meets the
requirements set forth in Temp. Reg. Section 14a.422A-1, A-39 (a) through (e)
inclusive) may be granted from time to time under the Plan to one or more
employees of the Company or of a "subsidiary" or "parent" of the Company, as the
quoted terms are defined within Section 424 of the Code. An Officer is an
employee for the above purposes. However, a director of the Company who is not
otherwise an employee is not deemed an employee for such purposes. Options,
other than ISO's, may be granted from time to time under the Plan to one or more
employees of the Company, Officers, members of the Board of Directors,
independent contractors, consultants and other individuals who are not employees
of, but are involved in the continuing development and success of the
<PAGE>
Company and/or of a subsidiary of the Company, including persons who have
previously been granted Options under the Plan.
4. Administration of the Plan.
The Plan shall be administered by the Board of Directors of the Company
as such Board of Directors may be composed from time to time and/or by a Stock
Option Committee (the "Committee") which shall be comprised of at least two
disinterested persons (the term "disinterested" having the meaning ascribed to
it by Rule 16b-3 of the Securities Exchange Act of 1934 (the "1934 Act))
appointed by such Board of Directors of the Company. As and to the extent
authorized by the Board of Directors of the Company, the Committee may exercise
the power and authority vested in the Board of Directors under the Plan. Within
the limits of the express provisions of the Plan, the Board of Directors or
Committee shall have the authority, in its discretion, to determine the
individuals to whom, and the time or times at which, Options shall be granted,
the character of such Options (whether ISO, NQSO, and/or SARs in tandem with
NQSOs, and/or SARs in tandem with ISOs) and the number of shares of Common Stock
to be subject to each Option, the manner and form in which the optionee can
tender payment upon the exercise of his Option, and to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to the Plan, to
determine the terms and provisions of Option agreements that may be entered into
in connection with Options (which need not be identical), subject to the
limitation that agreements granting ISOs must be consistent with the
requirements for the ISOs being qualified as "incentive stock options" as
provided in Section 422 of the Code, and to make all other determinations and
take all other actions necessary or advisable for the administration of the
Plan. In making such determinations, the Board of Directors and/or the Committee
may take into account the nature of the services rendered by such individuals,
their present and potential contributions to the Company's success, and such
other factors as the Board of Directors and/or the Committee, in its discretion,
shall deem relevant. The Board of Directors' and/or the Committee's
determinations on the matters referred to in this Paragraph shall be conclusive.
5. Terms of Options.
Within the limits of the express provisions of the Plan, the Board of
Directors or the Committee may grant either ISOs or NQSOs and/or SARs in tandem
with NQSOs or SARs in tandem with ISOs. An ISO or an NQSO enables the optionee
to purchase from the Company, at any time during a specified exercise period, a
specified number of shares of Common Stock at a specified price (the "Option
Price"). The optionee, if granted a SAR in tandem with a NQSO or ISO, may
receive from the Company, in lieu of exercising his option to purchase shares
pursuant to his NQSO or ISO, at one of the certain specified times during the
exercise period of the NQSO or ISO as set by the Board of Directors or the
Committee, the excess of the fair market value upon such exercise (as determined
in accordance with subparagraph (b) of this Paragraph 5) of one share of Common
Stock over the Option Price per share specified upon grant of the NQSO or
ISO/SAR multiplied by the number of shares of Common Stock covered by the SAR so
exercised. The character and terms of each Option granted under the Plan shall
be determined by the Board
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<PAGE>
of Directors and/or the Committee consistent with the provisions of the Plan,
including the following:
(a) An Option granted under the Plan must be granted within 10 years
from the date the Plan is adopted, or the date the Plan is approved by the
stockholders of the Company, whichever is earlier.
(b) The Option Price of the shares of Common Stock subject to each ISO
and each SAR issued in tandem with an ISO shall not be less than the fair market
value of such shares of Common Stock at the time such ISO is granted. Such fair
market value shall be determined by the Board of Directors and, if the shares of
Common Stock are listed on a national securities exchange or traded on the
over-the-counter market, the fair market value shall be the closing price on
such exchange, or the mean of the closing bid and asked prices of the shares of
Common Stock on the over-the-counter market, as reported by the National
Association of Securities Dealers Automated Quotation System (NASDAQ), the
National Association of Securities Dealers OTC Bulletin Board or the National
Quotation Bureau, Inc., as the case may be, on the day on which the Option is
granted or, if there is no closing price or bid or asked price on that day, the
closing price or mean of the closing bid and asked prices on the most recent day
preceding the day on which the Option is granted for which such prices are
available. If an ISO or SAR in tandem with an ISO is granted to any individual
who, immediately before the ISO is to be granted, owns (directly or through
attribution) more than 10% of the total combined voting power of all classes of
capital stock of the Company or a subsidiary or parent of the Company, the
Option Price of the shares of Common Stock subject to such ISO shall not be less
than 110% of the fair market value per share of the shares of Common Stock at
the time such ISO is granted.
(c) The Option Price of the shares of Common Stock subject to an NQSO
or an SAR in tandem with a NQSO granted pursuant to the Plan shall be determined
by the Board of Directors or the Committee, in its sole discretion.
(d) In no event shall any Option granted under the Plan have an
expiration date later than 10 years from the date of its grant, and all Options
granted under the Plan shall be subject to earlier termination as expressly
provided in Paragraph 6 hereof. If an ISO or a SAR in tandem with an ISO is
granted to any individual who, immediately before the ISO is granted, owns
(directly or through attribution) more that 10% of the total combined voting
power of all classes of capital stock of the Company or of a subsidiary or
parent of the Company, such ISO shall by its terms expire and shall not be
exercisable after the expiration of five (5) years from the date of its grant.
(e) With respect to the grant of SAR's to Officers and Directors of the
Company, an SAR may be exercised at any time after six months of the date of the
grant thereof during the exercise period of the ISO or NQSO with which it is
granted in tandem and prior to the exercise of such ISO or NQSO, but only within
the specified 10 business day period referred to in subsection (e)(3) of Rule
16b-3 of the 1934 Act (generally, the 10 business days immediately following the
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<PAGE>
publication of the Company's quarterly financial information) if the Company's
Common Stock is registered pursuant to Section 12(g) of the 1934 Act.
Notwithstanding the foregoing, the Board of Directors and/or the Committee shall
in their discretion determine from time to time the terms and conditions of
SAR's to be granted, which terms may vary from the afore-described conditions,
and which terms shall be set forth in a written stock option agreement
evidencing the SAR granted in tandem with the ISO or NQSO. The exercise of an
SAR granted in tandem with an ISO or NQSO shall be deemed to cancel such number
of shares subject to the unexercised Option as were subject to the exercised
SAR. The Board of Directors or the Committee also has the discretion to alter
the terms of the SARs if necessary to comply with Federal or state securities
law. Amounts to be paid by the Company in connection with an SAR may, in the
Board of Director's or the Committee's discretion, be made in cash, Common Stock
or a combination thereof.
(f) Unless otherwise provided in any Option agreement under the Plan,
an Option granted under the Plan shall become exercisable, in whole at any time
or in part from time to time, but in no case may an Option (i) be exercised as
to less than one hundred (100) shares of Common Stock at any one time, or the
remaining shares of Common Stock covered by the Option if less than one hundred
(100), and (ii) become fully exercisable more than five years from the date of
its grant nor shall less than 20% of the Option become exercisable in any of the
first five years of the Option. The Board of Directors or the Committee, in its
sole discretion, may at such time or times as it deems appropriate, if ever,
accelerate all or part of the vesting provisions with respect to one or more
outstanding options. The acceleration of one option shall not infer that any
option is or to be accelerated.
(g) An Option granted under the Plan shall be exercised by the delivery
by the holder thereof to the Company at its principal office (to the attention
of the Secretary) of written notice of the number of full shares of Common Stock
with respect to which the Option is being exercised, accompanied by payment in
full, which payment at the option of the optionee shall be in the form of (i)
cash or certified or bank check payable to the order of the Company, of the
Option Price of such shares of Common Stock, or, (ii) if permitted by the
Committee or the Board of Directors, as determined by the Committee or the Board
of Directors in its sole discretion at the time of the grant of the Option with
respect to an ISO and at or prior to the time of exercise with respect to a
NQSO, by the delivery of shares of Common Stock having a fair market value equal
to the Option Price or the delivery of an interest-bearing promissory note
having an original principal balance equal to the Option Price and an interest
rate not below the rate which would result in imputed interest under the Code
(provided, in order to qualify as an ISO, more than one year shall have passed
since the date of grant and one year from the date of exercise), or (iii) at the
option of the Committee or the Board of Directors, determined by the Committee
or the Board of Directors in its sole discretion at the time of the grant of the
Option with respect to an ISO and at or prior to the time of exercise with
respect to a NQSO, by a combination of cash, promissory note and/or such shares
of Common Stock (subject to the restriction above) held by the employee that
have a fair market value together with such cash and principal amount of any
promissory note that shall equal the Option Price, and, in the case of a NQSO,
at the discretion of the Committee or Board of Directors by having the Company
withhold from the shares of Common Stock to be
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<PAGE>
issued upon exercise of the Option that number of shares having a fair market
value equal to the exercise price and/or the tax withholding amount due, or
otherwise provide for withholding as set forth in Paragraph 9(c) hereof, or in
the event an employee is granted an ISO or NQSO in tandem with an SAR and
desires to exercise such SAR, such written notice shall so state such intention.
The Option Price may also be paid in full by a broker-dealer to whom the
optionee has submitted an exercise notice consisting of a fully endorsed Option,
or through any other medium of payment as the Board of Directors and/or the
Committee, in its discretion, shall authorize.
(h) The holder of an Option shall have none of the rights of a
stockholder with respect to the shares of Common Stock covered by such holder's
Option until such shares of Common Stock shall be issued to such holder upon the
exercise of the Option.
(i) All Options granted under the Plan shall not be transferable
otherwise than by will or the laws of descent and distribution, and any ISO or
SAR in tandem with an ISO granted under the Plan may be exercised during the
lifetime of the holder thereof only by the holder. No Option granted under the
Plan shall be subject to execution, attachment or other process.
(j) The aggregate fair market value, determined as of the time any ISO
or SAR in tandem with an ISO is granted and in the manner provided for by
Subparagraph (b) of this Paragraph 5, of the shares of Common Stock with respect
to which ISOs granted under the Plan are exercisable for the first time during
any calendar year and under incentive stock options qualifying as such in
accordance with Section 422 of the Code granted under any other incentive stock
option plan maintained by the Company or its parent or subsidiary corporations,
shall not exceed $100,000. Any grant of Options in excess of such amount shall
be deemed a grant of a NQSO.
(k) Notwithstanding anything contained herein to the contrary, a SAR
which was granted in tandem with an ISO shall (i) expire no later than the
expiration of the underlying ISO; (ii) be for no more than 100% of the spread at
the time the SAR is exercised; (iii) shall only be transferable when the
underlying ISO is transferable; (iv) only be exercised when the underlying ISO
is eligible to be exercised; and (v) only be exercisable when there is a
positive spread.
6. Death or Termination of Employment.
(a) Subject to the provisions of subparagraph (d) of this Paragraph 6
and except as otherwise determined by the Board of Directors or the Committee in
its sole discretion, if the employment of a holder of an ISO under the Plan
shall be terminated for any reason other than cause or the death or the
disability of the holder, such holder's ISO shall expire within three (3) months
after such termination. Except as otherwise determined by the Board of Directors
or the Committee, in its sole discretion, if the employment of a holder of an
ISO, NQSO, and/or SAR in tandem with a NQSO shall terminate for cause, then any
unexercised ISO, NQSO, and/or SAR in tandem with a NQSO granted to the holder
shall expire as at the time of termination. If the employment of a holder of an
Option (exclusive of his ISOs) shall be terminated for any reason other than
cause or the death or the disability of the holder, such holder's Options, other
than his
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<PAGE>
ISOs, may be exercised during the earlier of (i) the respective terms thereof,
or (ii) the subsequent death or disability of the respective holder, subject to
the provisions of subparagraphs (b) and (d) of this Paragraph 6, unless the
Board of Directors or the Committee shall in its sole discretion set forth to
the contrary in the holder's Option Agreement.
(b) If the holder of an Option granted under the Plan dies (i) while
employed by the Company or a subsidiary or parent corporation or (ii) within
three (3) months after the termination of such holder's employment, such Options
may, subject to the provisions of subparagraph (d) of this Paragraph 6, be
exercised by a legatee or legatees of such Option under such individual's last
will or by such individual's personal representatives or distributees at any
time within such time as determined by the Board of Directors or the Committee
in its sole discretion, but in no event less than six months after the
individual's death, to the extent such Options were exercisable as of the date
of death or date of termination of employment, whichever date is earlier.
(c) If the holder of an Option under the Plan becomes disabled within
the definition of section 22(e)(3) of the Code while employed by the Company or
a subsidiary or parent corporation, such Option may, subject to the provisions
of subparagraph (d) of this Paragraph 6, be exercised at any time within six
months after such holder's termination of employment due to the disability.
(d) Except as otherwise determined by the Board of Directors or the
Committee in its sole discretion, an Option may not be exercised pursuant to
this Paragraph 6 except to the extent that the holder was entitled to exercise
the Option at the time of termination of employment or death, and in any event
may not be exercised after the original expiration date of the Option.
7. Leave of Absence.
For the purposes of the Plan, an individual who is on military or sick
leave or other bona fide leave of absence (such as temporary employment by the
Government) shall be considered as remaining in the employ of the Company or of
a subsidiary or parent corporation for ninety (90) days or such longer period as
such individual's right to reemployment is guaranteed either by statute or by
contract.
8. Adjustment Upon Changes in Capitalization.
(a) In the event that the outstanding shares of Common Stock are
hereafter changed by reason of recapitalization, reclassification, stock
split-up, combination or exchange of shares of Common Stock or the like, or by
the issuance of dividends payable in shares of Common Stock, an appropriate
adjustment shall be made by the Board of Directors, as determined by the Board
of Directors and/or the Committee, in the aggregate number of shares of Common
Stock available under the Plan, in the number of shares of Common Stock issuable
upon exercise of outstanding Options, and the Option Price per share. In the
event of any consolidation or merger of the Company with or into another
company, or the conveyance of all or substantially all of the assets
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<PAGE>
of the Company to another company, each then outstanding Option shall upon
exercise thereafter entitle the holder thereof to such number of shares of
Common Stock or other securities or property to which a holder of shares of
Common Stock of the Company would have been entitled to upon such consolidation,
merger or conveyance; and in any such case appropriate adjustment, as determined
by the Board of Directors of the Company (or successor entity) shall be made as
set forth above with respect to any future changes in the capitalization of the
Company or its successor entity. In the event of the proposed dissolution or
liquidation of the Company, all outstanding Options under the Plan will
automatically terminate, unless otherwise provided by the Board of Directors of
the Company or any authorized committee thereof.
(b) Any Option granted under the Plan, unless waived by the Board of
Directors or the Committee, may, at the discretion of the Board of Directors of
the Company and said other corporation, be exchanged for options to purchase
shares of capital stock of another corporation which the Company, and/or a
subsidiary thereof is merged into, consolidated with, or all or a substantial
portion of the property or stock of which is acquired by said other corporation
or separated or reorganized into. The terms, provisions and benefits to the
optionee of such substitute option(s) shall in all respects be identical to the
terms, provisions and benefits of optionee under his Option(s) prior to said
substitution. To the extent the above may be inconsistent with Sections
424(a)(1) and (2) of the Code, the above shall be deemed interpreted so as to
comply therewith.
(c) Any adjustment in the number of shares of Common Stock shall apply
proportionately to only the unexercised portion of the Options granted
hereunder. If fractions of shares of Common Stock would result from any such
adjustment, the adjustment shall be revised to the next higher whole number of
shares of Common Stock.
9. Further Conditions of Exercise.
(a) Unless the shares of Common Stock issuable upon the exercise of an
Option have been registered with the Securities and Exchange Commission pursuant
to the Securities Act of 1933, as amended, prior to the exercise of the Option,
an optionee must represent in writing to the Company that such shares of Common
Stock are being acquired for investment purposes only and not with a view
towards the further resale or distribution thereof, and must supply to the
Company such other documentation as may be required by the Company, unless in
the opinion of counsel to the Company such representation, agreement or
documentation is not necessary to comply with said Act.
(b) The Company shall not be obligated to deliver any shares of Common
Stock until they have been listed on each securities exchange on which the
shares of Common Stock may then be listed or until there has been qualification
under or compliance with such state or federal laws, rules or regulations as the
Company may deem applicable.
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<PAGE>
(c) The Board of Directors or Committee may make such provisions and
take such steps as it may deem necessary or appropriate for the withholding of
any taxes that the Company is required by any law or regulation of any
governmental authority, whether federal, state or local, domestic or foreign, to
withhold in connection with the exercise of any Option, including, but not
limited to, (i) the withholding of payment of all or any portion of such Option
and/or SAR until the holder reimburses the Company for the amount the Company is
required to withhold with respect to such taxes, or (ii) the cancelling of any
number of shares of Common Stock issuable upon exercise of such Option and/or
SAR and/or SDR in an amount sufficient to reimburse the Company for the amount
it is required to so withhold, (iii) the selling of any property contingently
credited by the Company for the purpose of exercising such Option, in order to
withhold or reimburse the Company for the amount it is required to so withhold,
or (iv) withholding the amount due from such employee's wages if the employee is
employed by the Company or any subsidiary thereof.
10. Termination, Modification and Amendment.
(a) The Plan (but not Options previously granted under the Plan) shall
terminate ten (10) years from the earliest of the date of its adoption by the
Board of Directors, or the date the Plan is approved by the stockholders of the
Company, or such date of termination, as hereinafter provided, and no Option
shall be granted after termination of the Plan.
(b) The Plan may from time to time be terminated, modified or amended
by the affirmative vote of the holders of a majority of the outstanding shares
of capital stock of the Company entitled to vote thereon.
(c) The Board of Directors of the Company may at any time, prior to
ten (10) years from the earlier of the date of the adoption of the Plan by such
Board of Directors or the date the Plan is approved by the stockholders,
terminate the Plan or from time to time make such modifications or amendments of
the Plan as it may deem advisable; provided, however, that the Board of
Directors shall not, without approval by the affirmative vote of the holders of
a majority of the outstanding shares of capital stock of the Company entitled to
vote thereon, increase (except as provided by Paragraph 8) the maximum number of
shares of Common Stock as to which Options or shares may be granted under the
Plan, materially change the standards of eligibility under the Plan or amend any
provision hereof which requires stockholder approval in order to preserve the
status of the Plan as a plan qualifying under Rule 16b-3 of the 1934 Act if the
Plan would otherwise qualify thereunder. Any amendment to the Plan which, in the
opinion of counsel to the Company, will be deemed to result in the adoption of a
new Plan, will not be effective until approved by the affirmative vote of the
holders of a majority of the outstanding shares of capital stock of the Company
entitled to vote thereon.
(d) No termination, modification or amendment of the Plan may
adversely affect the rights under any outstanding Option without the consent of
the individual to whom such Option shall have been previously granted.
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<PAGE>
11. Effective Date of the Plan.
The Plan shall become effective upon adoption by the Board of
Directors of the Company. The Plan shall be subject to approval by the
affirmative vote of the holders of a majority of the outstanding shares of
capital stock of the Company entitled to vote thereon within one year before or
after adoption of the Plan by the Board of Directors.
12. Not a Contract of Employment.
Nothing contained in the Plan or in any option agreement executed
pursuant hereto shall be deemed to confer upon any individual to whom an Option
is or may be granted hereunder any right to remain in the employ of the Company
or of a subsidiary or parent of the Company or in any way limit the right of the
Company, or of any parent or subsidiary thereof, to terminate the employment of
any employee.
13. Other Compensation Plans.
The adoption of the Plan shall not affect any other stock option plan,
incentive plan or any other compensation plan in effect for the Company, nor
shall the Plan preclude the Company from establishing any other form of stock
option plan, incentive plan or any other compensation plan.
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APPENDIX 1 PROXY CARD
PICK Communications Corp.
Wayne Interchange Plaza II
155 Route 46 West
Wayne, New Jersey 07470
(201) 812-7425
The undersigned, a holder of Common Stock of PICK Communications
Corp., a Nevada corporation (the "Company"), hereby appoints Robert Bingham and
Raymond M. Brennan, and each of them, the proxies of the undersigned (the
"Proxies"), each with full power of substitution, to attend, represent and vote
for the undersigned, all of the shares of Common Stock of the Company which the
undersigned would be entitled to vote, at the Annual Meeting of Stockholders of
the Company to be held on December 11, 1997 and any adjournments thereof, as
follows:
1. ELECTION OF DIRECTORS, as provided in the Company's Proxy Statement:
[ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to vote for
all nominees listed below. (Instructions: TO WITHHOLD AUTHORITY TO
VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE A LINE THROUGH OR OTHERWISE
STRIKE OUT HIS NAME BELOW)
Diego Leiva, Raymond M. Brennan, Robert R. Sams, Ricardo Maranon and
Marilou C. Halvorsen.
2. Amending the Company's 1996 Employee Stock Option Plan to authorize an
INCREASE IN THE NUMBER OF OPTIONS AVAILABLE FOR GRANT UNDER THE
COMPANY'S EMPLOYEE STOCK OPTION PLAN FROM 5,000,000 TO 7,500,000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. The ratification of the APPOINTMENT OF DURLAND & COMPANY, CPAs, P.A.
as the Company's auditors for the fiscal year ending December 31,
1997.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. Upon such other matters as may properly come before the meeting or any
adjournments thereof.
The undersigned hereby revokes any other proxy previously granted
to vote at such Annual Meeting, and hereby ratifies and confirms all that the
above-named Proxies, and each of them,
<PAGE>
may lawfully do by virtue hereof. With respect to matters not known at the time
of the solicitation hereof, said Proxies are authorized to vote in accordance
with their best judgment.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN ACCORDANCE WITH
THE INSTRUCTIONS ON THE REVERSE SIDE HEREOF. IF NO CONTRARY INSTRUCTIONS ARE
GIVEN, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE FIVE DIRECTORS NAMED IN
PROPOSAL 1, FOR THE ADOPTION OF PROPOSALS 2 AND 3 AND AS SAID PROXIES SHALL DEEM
ADVISABLE WITH RESPECT TO SUCH OTHER BUSINESS AS MAY COME BEFORE THE MEETING.
The undersigned acknowledges receipt of copies of the Annual Report,
the Notice of Annual Meeting, and the accompanying Proxy Statement of the
Company relating to the Annual Meeting.
______________________________
______________________________
Signature(s) of Stockholder(s)
Dated:__________________, 1997
The signature(s) hereon should correspond exactly to the name(s) of the
Stockholder(s) appearing on the Stock Certificate. If stock is jointly held, all
joint owners should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If signer is a corporation,
please indicate the full corporate name and indicate the title of signing
officer.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF
PICK COMMUNICATIONS CORP.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY
PROMPTLY USING THE ENCLOSED ENVELOPE.
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