SCHEDULE 14A INFORMATION
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 the Commission Only (as permitted by Rule
14a-b(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (')240.14a-11(C) or (')240.14a-12
D & E COMMUNICATIONS, INC.
(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
----------------------------------------------------------------------
(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 0-11(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.
(6) Amount Previously Paid:
---------------------------------------------
(7) Form, Schedule or Registration Statement No.:
---------------------------------------------
(8) Filing Party:
---------------------------------------------
(9) Date Filed:
---------------------------------------------
Notes:
<PAGE>
D & E COMMUNICATIONS, INC.
124 EAST MAIN STREET
P.O. BOX 458
EPHRATA, PA 17522-0458
717-733-4101
ANNE B. SWEIGART
Chairman, President and Chief
Executive Officer
April 3, 1998
To Our Shareholders:
You are cordially invited to attend the 1998 Annual Meeting of
Shareholders. It is to be held at the Brossman Business Complex, 124 East Main
Street, Ephrata, Pennsylvania 17522, on Thursday, April 30, 1998, at 10:30 a.m.
local time.
This year, you are being asked to elect four (4) nominees to the Board of
Directors of D & E Communications, Inc. (the "Company"). Three of the nominees
are directors who currently serve as members of Class C of the Board of
Directors. One is a first time nominee to Class C who will fill a current
vacancy on the Board. In addition, you will also be asked to ratify the Board of
Directors' selection of Coopers & Lybrand L.L.P. as independent accountants for
1998.
Detailed information as to the business to be transacted at the meeting is
contained in the accompanying Notice of Annual Meeting and Proxy Statement.
At your earliest convenience, please mark, sign, and date the enclosed
Proxy Card and the Meeting Attendance Card and return them to us in the envelope
provided. In addition, if you are also a participant in the Company's Dividend
Reinvestment Plan, please mark and return to us at the same time the
Participant's Direction Card which is also enclosed. Duly executed but unmarked
Proxy Cards and Participant's Direction Cards will be voted FOR the election of
the four (4) nominees for director, and FOR the ratification of Coopers &
Lybrand L.L.P. as independent accountants for 1998. If you attend the meeting,
you may, of course, choose to revoke your proxy and personally cast your vote.
Sincerely yours,
(Mrs.) Anne B. Sweigart
Chairman of the Board, President
Enclosures and Chief Executive Officer
<PAGE>
D & E COMMUNICATIONS, INC.
124 EAST MAIN STREET
P.O. BOX 458
EPHRATA, PA 17522-0458
717-733-4101
ANNE B. SWEIGART
Chairman, President and Chief
Executive Officer
April 3, 1998
To Our Employee Stock Ownership Plan Participants:
You are cordially invited to attend the 1998 Annual Meeting of
Shareholders. It is to be held at the Brossman Business Complex, 124 East Main
Street, Ephrata, Pennsylvania 17522, on Thursday, April 30, 1998, at 10:30 a.m.
local time.
This year, you are being asked to elect four (4) nominees to the Board of
Directors of D & E Communications, Inc. (the "Company"). Three of the nominees
are directors who currently serve as members of Class C of the Board of
Directors. One is a first time nominee to Class C who will fill a current
vacancy on the Board. In addition, you will be asked to ratify the Board of
Directors' selection of Coopers & Lybrand L.L.P. as independent accountants for
1998.
Detailed information as to the business to be transacted at the meeting is
contained in the accompanying Notice of Annual Meeting and Proxy Statement.
At your earliest convenience, please mark, sign and date: (1) the enclosed
Participant's Direction Card and return it to the plan trustee, CoreStates Bank,
and (2) the other proxy cards enclosed, and Meeting Attendance Card and return
them to the Company in the envelopes provided.
Sincerely yours,
(Mrs.) Anne B. Sweigart
Chairman of the Board, President
Enclosures and Chief Executive Officer
<PAGE>
D & E COMMUNICATIONS, INC.
124 EAST MAIN STREET
P.O. BOX 458
EPHRATA, PA 17522-0458
717-733-4101
ANNE B. SWEIGART
Chairman, President and Chief
Executive Officer
April 3, 1998
To Our Shareholders:
You are cordially invited to attend the 1998 Annual Meeting of
Shareholders. It is to be held at the Brossman Business Complex, 124 East Main
Street, Ephrata, Pennsylvania 17522, on Thursday, April 30, 1998, at 10:30 a.m.
local time.
At your earliest convenience, please mark and sign the enclosed Meeting
Attendance Card and return it to us in the envelope provided.
Sincerely,
(Mrs.) Anne B. Sweigart
Chairman of the Board, President
Enclosures and Chief Executive Officer
<PAGE>
D & E COMMUNICATIONS, INC.
Ephrata, Pennsylvania
NOTICE OF 1998 ANNUAL MEETING
TO SHAREHOLDERS AND PARTICIPANTS
IN THE DIVIDEND REINVESTMENT PLAN
The Annual Meeting of the Shareholders of D & E Communications, Inc. ("the
Company") will be held in accordance with the By-Laws of the Company on
Thursday, April 30, 1998, at 10:30 a.m. local time, at the Brossman Business
Complex, 124 East Main Street, Ephrata, Pennsylvania 17522. The purposes of the
meeting, which are more fully described in the accompanying Proxy Statement,
are:
1. To elect four (4) Class C Directors for a term to expire in the year
2001 (and until their successors are duly elected and qualified);
2. To ratify the Board of Directors' selection of Coopers & Lybrand L.L.P.
as the Company's independent accountants for 1998; and
3. To act upon such other business as may properly come before the meeting.
Only holders of common stock of record on the books of the Company at the
close of business on March 13, 1998, will be entitled to vote at the Annual
Meeting or any adjournment thereof.
The Company, as trustee of the D & E Communications, Inc. Dividend
Reinvestment Plan (the "DRP"), is the record owner of the shares which have been
allocated to your DRP account. Pursuant to the DRP, you are entitled to direct
the trustee on how to vote the shares allocated to your account by returning the
enclosed Participant's Direction Card. A copy of the Proxy Statement, the 1997
Annual Report of the Company, the Independent Accountants' Report, a Proxy Card,
and a Participant's Direction Card are being mailed to you simultaneously prior
to the Annual Meeting. The Board of Directors' nominees for directors are set
forth in the accompanying Proxy Statement, as well as further information on the
foregoing matters.
THE ENCLOSED PROXY AND PARTICIPANT'S DIRECTION, WHICH ARE BEING SOLICITED
ON BEHALF OF THE BOARD OF DIRECTORS, CAN BE RETURNED IN THE ENCLOSED ENVELOPE.
IT REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
By Order of the Board of Directors
April 3, 1998 W. Garth Sprecher
Secretary
Enclosures
<PAGE>
D & E COMMUNICATIONS, INC.
Ephrata, Pennsylvania
------------------------
NOTICE OF 1998 ANNUAL MEETING OF SHAREHOLDERS
TO PARTICIPANTS OF THE D & E COMMUNICATIONS, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
------------------------
The Annual Meeting of the Shareholders of D & E Communications, Inc. ("the
Company") will be held in accordance with the By-Laws of the Company, on
Thursday, April 30, 1998, at 10:30 a.m. local time, at the Brossman Business
Complex, 124 East Main Street, Ephrata, Pennsylvania 17522. The purposes of the
meeting, which are more fully described in the accompanying Proxy Statement,
are:
1. To elect four (4) Class C Directors for a term to expire in the
year 2001 (and until their successors are duly elected and qualified);
2. To ratify the Board of Directors' selection of Coopers & Lybrand
L.L.P. as the Company's independent accountants for 1998; and
3. To act upon such other business as may properly come before the
meeting.
Only holders of common stock of record on the books of the Company at the
close of business on March 13, 1998, will be entitled to vote at the Annual
Meeting or any adjournment thereof. CoreStates Bank, the trustee (the "Trustee")
of the D & E Communications, Inc. Employee Stock Ownership Plan (the "ESOP"), is
the record owner of the shares which have been allocated to your ESOP account.
Pursuant to the ESOP, you are entitled to direct the Trustee on how to vote the
shares allocated to your account by returning the enclosed Participant's
Direction Card. A copy of the Proxy Statement, the 1997 Annual Report of the
Company, the Independent Accountants' Report, and a Participant's Direction Card
are being mailed to you simultaneously prior to the Annual Meeting. The Board of
Directors' nominees for directors are set forth in the accompanying Proxy
Statement, as well as further information on the foregoing matters.
THE ENCLOSED PARTICIPANT'S DIRECTION, WHICH IS BEING SOLICITED ON BEHALF OF
THE BOARD OF DIRECTORS, SHOULD BE RETURNED TO THE TRUSTEE IN THE ENCLOSED
ENVELOPE. IT REQUIRES NO POSTAGE IF MAILED IN THE UNITED STATES.
April 3, 1998 By Order of the Board of Directors
W. Garth Sprecher
Secretary
Enclosures
<PAGE>
PROXY STATEMENT
Proxies in the accompanying form are being solicited by the Board of
Directors (the "Board") of D & E Communications, Inc. ("the Company"), for use
at the Annual Meeting of the Shareholders to be held at 10:30 a.m. on Thursday,
April 30, 1998 at the Brossman Business Complex, 124 East Main Street, Ephrata,
Pennsylvania 17522 (the "Annual Meeting"). This proxy statement and the form of
proxy are being mailed to the Shareholders (as defined below) commencing on or
about April 3, 1998.
Only holders of shares of common stock, par value $0.16 per share, of the
Company ("Common Stock") as shown on the books of the Company at the close of
business on March 13, 1998 (the "Record Date") will be entitled to vote at the
meeting. On the Record Date, there were 7,432,389 shares of Common Stock
outstanding. Holders of record of Common Stock at the close of business on the
Record Date (the "Shareholders"), or their proxies, are entitled to cumulative
voting rights in the election of directors at the Annual Meeting. Under
cumulative voting, a Shareholder, or the Shareholder's proxy, may vote the
number of shares of Common Stock owned by the Shareholder for as many persons as
there are directors to be elected, or may cumulate such votes and give to one,
or distribute among two or more nominees, as many votes as shall equal the
number of directors to be elected multiplied by the number of the Shareholder's
shares of Common Stock. Those persons receiving the highest number of votes are
declared to be elected directors of the Company. For all other purposes, the
Shareholders, or their proxies, are entitled to one vote per each share of
Common Stock at the Annual Meeting.
Judges of election are appointed by the Board to conduct the tabulation of
votes with respect to the election of directors and the other matters to come
before the Annual Meeting and to report the results thereof. The presence in
person or by proxy of the holders of a majority of the shares of Common Stock
outstanding is required to constitute a quorum for transaction of business at
the Annual Meeting. The holders of Common Stock have one vote for each share
held by them as of the Record Date.
On June 11, 1996, the Denver and Ephrata Telephone and Telegraph Company
("Telco") effected a restructuring into a holding company structure whereby the
Company, which had been a wholly-owned subsidiary of Telco, became the parent
company and 100% owner of the shares of the common stock of Telco, and all of
the holders of common stock of Telco became the holders of all of the Common
Stock of the Company. Accordingly, references in this proxy statement to the
Company in a historical context are intended to be the Company on and after June
11, 1996 and to Telco before June 11, 1996.
PROPOSAL 1: ELECTION OF FOUR (4) DIRECTORS
The Company's Articles of Incorporation provide for a maximum of twelve
(12) directors to be elected to the Company's Board. The Company has determined
that one or more vacancies in the Board may be appropriate and therefor proxies
may not be voted for a greater number of nominees than are named herein.
The Board currently consists of ten (10) members divided into three (3)
classes which are classified with respect to the year in which their terms shall
expire. Each class of directors holds office for a term of three (3) years (and
until their successors are duly elected and qualified), and the three (3)
classes of the Board are staggered. Accordingly, one of the three (3) classes is
elected each year to succeed the directors whose terms are expiring. Currently,
the directors in Class C are serving terms expiring this year. The directors in
Classes A and B are serving terms expiring at the annual meeting of the
shareholders in 1999 and 2000, respectively. The Board has nominated for
re-election to Class C three (3) directors whose terms expire this year; namely
Paul W. Brubaker, Steven B. Silverman and Anne B. Sweigart. In addition, the
Board is nominating Robert A. Kinsley to serve as a fourth member of Class C. If
elected, their terms are to expire in the year 2001 (and until their successors
are duly elected and qualified). There are no arrangements or understandings
between any director or nominee and any other person pursuant to which the
director or nominee was or is to be elected as a director.
1
<PAGE>
The Company has been advised by the persons named in the accompanying proxy
that they intend to vote pursuant to the proxy for the election of Messrs.
Brubaker and Silverman and Mrs. Sweigart (who are presently directors of the
Company with regular terms expiring this year), and Mr. Kinsley who is a new
nominee to Class C, and to exercise cumulative voting, if necessary, to secure
their election. Each individual nominated for election as a director has agreed
to serve if elected. However, the Company is informed that in the event of the
refusal or inability of any of the foregoing nominees for director to serve, the
persons named in the accompanying proxy intend to vote at the Annual Meeting
pursuant to the proxy for the election of such person(s), if any, as may be
nominated by the Board, subject to the right of the persons named in the proxy
to exercise cumulative voting rights as described above.
DIRECTORS
Information follows about each nominee to serve in Class C and the other
directors serving in Classes A and B.
Nominees for Class C Directors For Terms To Expire In 2001
Paul W. Brubaker, age 54, is a Director, Executive Vice President and
Corporate Secretary of the Ephrata National Bank where he has been employed
since 1961. He is a member of the American Institute of Banking and of the
Finance Committee of the Ephrata Economic Development Board, and he has served
as Vice Chairman of the National Board of the Church of the Brethren in Elgin,
Illinois. He has been a director of the Company since 1990. Mr. Brubaker is
Chairman of the Audit Committee.
Steven B. Silverman, age 65, has been a senior partner in the law firm of
Rothenberg, Silverman and Furman PC, Elkins Park, Pennsylvania since 1995. Prior
to 1995 he was a senior partner in Rothenberg and Silverman. In addition to his
private practice, he serves as an adjunct professor of labor law at Dickinson
School of Law in Carlisle, Pennsylvania. He has been a director of the Company
since 1991. Mr. Silverman is Chairman of the Compensation Committee.
Anne B. Sweigart, age 83, has held the positions of Chief Executive
Officer, President and Chairman of the Board of the Company since July 1985. She
became a director in 1952. Mrs. Sweigart served as Executive Vice President from
March 1981 to July 1985. Her employment began in 1936, twenty-five years after
her father founded the Company. From that time until today, she has always been
involved in the management affairs of the Company. She serves on numerous
community Boards and is currently a Trustee of Rider University, an Associate
Trustee of Elizabethtown College, an Honorary Trustee of Lebanon Valley College
and a Trustee of Linden Hall School for Girls. Mrs. Sweigart is also a Director
of the Pennsylvania Telephone Association. Mrs. Sweigart is a member of the
Audit Committee and serves as Chairman of the Executive Committee.
Robert A. Kinsley, age 57, is Chairman and Chief Executive Officer of
Kinsley Construction, a company he founded in York, PA in 1963 that specializes
in heavy, general, and design build construction. Mr. Kinsley is also managing
partner of Kinsley Equities, which is a regional real estate developer of
industrial and commercial properties. He is also a director of Mercantile - Safe
Deposit & Trust Company, Baltimore, MD and Ruscilli Construction Company of
Columbus, OH. Mr. Kinsley is Chairman of the Board of I. B. Abel, an electrical
construction firm in south central PA. He serves numerous community and
professional organizations and is currently President of South George Street
Community Partnership, Chairman of the York County Air Transportation Authority,
member of the York Foundation Board of Directors and a Trustee of York College
of Pennsylvania. Mr. Kinsley is a first-time nominee to the Board of the
Company.
Class A Directors Whose Terms Expire In 1999
John Amos, age 66, has been in the commercial fruit and produce growing
business for more than 43 years in Grand Traverse County, Michigan serving as
President of Hi-Lo Farms, Inc. since 1979 and as Senior Partner of Amos Farms
since 1980. He became a member of the Board in 1990. Mr. Amos is a member of the
Compensation Committee.
2
<PAGE>
G. William Ruhl, age 58, has been the Senior Vice President of the Company
and Chief Executive Officer of Telco since 1996. From 1991, when he joined the
Company, to 1996 he held the position of Senior Vice President of Telco. He was
previously employed by Bell of Pennsylvania from 1961 to 1991, at which time he
retired as Director of Network Architecture and Deployment Planning. Mr. Ruhl is
a registered Professional Engineer and a member of the Institute of Electrical
and Electronics Engineers, Inc. He is Chairman of the Board of Directors of
Monor Telephone Company and serves on the Board of Alliance for
Telecommunications Industry Solutions. Mr. Ruhl is also on the Board of
Directors of the Central Pennsylvania Symphony. He became a director of the
Company in 1993. Mr. Ruhl is a member of the Executive Committee.
W. Garth Sprecher, age 46, is Vice President and Secretary of the Company
and Chief Executive Officer of D & E Marketing Corp. He joined the Company in
1984 as a Communications Consultant for D&E Telephone and Data Systems, Inc.
(f.k.a. Red Rose Systems, Inc.). He was named Commercial Manager of the Company
in 1988. In 1990, he assumed the position of Assistant Secretary and Director of
External Affairs, and in 1996, he assumed his present position. He is a member
of the Board of Directors of the Lancaster Chamber of Commerce and Industry and
is a director of the Ephrata Chamber of Commerce. He is also Vice President of
the Board of Directors of the Mid-Atlantic Chapter of the American Society of
Corporate Secretaries and also serves on the Executive Board of the Pennsylvania
Dutch Council of the Boy Scouts of America. Mr. Sprecher became a Director of
the Company in 1993. Mr. Sprecher is a member of the Executive Committee.
Class B Directors Whose Terms Expire In 2000
Thomas H. Bamford, age 58, is Director of Community Relations for the
Lancaster Health Alliance. He joined the Alliance in 1995 upon his retirement
after nearly 27 years with CoreStates Bank. At his retirement, he was Senior
Vice President, Director of Corporate Communications and Lancaster Area
Executive Officer for CoreStates Bank. Mr. Bamford is an accredited member of
the Public Relations Society of America. He is currently a director of the
United Way of Lancaster County, the Louise Von Hess Foundation for Medical
Education, the Lancaster Housing Opportunities Partnership, the Lancaster YMCA
Foundation, and the Rotary Club of Lancaster. He is a member of the Marketing
and Communications Council of the Lancaster Chamber of Commerce and Industry and
the Lancaster County Health Partnership. He became a Director of the Company in
1997. Mr. Bamford is a member of the Compensation Committee.
Ronald E. Frisbie, age 75, retired from the Company in 1992 where he served
as a Vice President of the Company from 1971 until 1992, and Secretary,
Treasurer and Assistant to the President from 1985 until 1992. He was employed
by the Western Electric Company from 1947 to 1949 and the Commonwealth Telephone
Company from 1949 to 1953 at which time he became employed by the Company as
Wire Chief. Mr. Frisbie has been a Director since 1983. Mr. Frisbie is a member
of the Audit Committee.
Robert M. Lauman, age 72, has been the Executive Vice President and Chief
Operating Officer of the Company since 1990. He joined the Company in 1983 and
was previously employed by Bell of Pennsylvania from 1946 to 1983, at which time
he retired as Vice President - Engineering. Mr. Lauman is a registered
Professional Engineer, a member of the Pennsylvania Society of Professional
Engineers and a member of the Institute of Electrical and Electronics Engineers,
Inc. He has been a director of the Company since 1983. Mr. Lauman is a member of
the Executive Committee and the Compensation Committee.
D. Mark Thomas, age 50, has been a managing partner in the law firm of
Thomas, Thomas, Armstrong & Niesen, Harrisburg, PA, since the formation of the
firm in 1991, concentrating primarily in public utility and telecommunications
law. Previous thereto, he was a partner in the law firm of Thomas & Thomas from
1977 to 1990. Mr. Thomas became a director of the Company in 1997. Mr. Thomas is
a member of the Audit Committee.
3
<PAGE>
GENERAL INFORMATION REGARDING THE BOARD OF DIRECTORS
Director Attendance at Board Meetings
The Board held a total of twelve (12) regularly scheduled meetings and one
(1) special meeting, during the year ended December 31, 1997. Each incumbent
director attended in excess of 75% of the aggregate meetings of the Board and
the Board's committees on which he or she served. The Board has the following
three (3) standing committees: the Audit Committee, the Compensation Committee,
and the Executive Committee.
Compensation of Directors
The directors were each paid $950.00 per meeting which they attended
($500.00 per meeting in which they did not participate) and $100.00 per any
committee meeting of the Board not held in conjunction with a Board meeting.
Actual travel and lodging expenses were also reimbursed.
BOARD COMMITTEES
Audit Committee
The current Audit Committee, consisting of Paul W. Brubaker (Chairman),
Ronald E. Frisbie, Anne B. Sweigart, and D. Mark Thomas, is responsible for
recommending to the Board the firm of independent public accountants responsible
to audit the Company's financial statements. This Committee also reviews with
the independent public accountants the results of their audit work. The Audit
Committee held two (2) meetings during 1997.
Compensation Committee
The current Compensation Committee, consisting of Steven B. Silverman
(Chairman), John Amos, Thomas H. Bamford and Robert M. Lauman reviews and makes
recommendations to the Board regarding the compensation practices of the
Company. The Compensation Committee held one (1) meeting during 1997.
Executive Committee
The current Executive Committee, consisting of Anne B. Sweigart (Chairman),
Robert M. Lauman, G. William Ruhl and W. Garth Sprecher, is designed to perform
and uphold the duties and responsibilities of the Board as dictated by the
By-Laws of the Company and within the limitations set by the Board. The
Executive Committee held nine (9) meetings during 1997.
4
<PAGE>
SECURITY OWNERSHIP OF MANAGEMENT
As of March 6, 1998 (the "Most Practicable Date"), there were 7,432,389
shares of the Company's Common Shares outstanding. The table below sets forth
the ownership of the Common Stock held, as of the Most Practicable Date, by each
of (i) the directors (and nominees), (ii) the executive officers and (iii) all
directors and officers as a group.
<TABLE>
<CAPTION>
NATURE AND AMOUNT OF PERCENT
NAME OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF CLASS
------------------------ ----------------------- --------
<S> <C> <C>
John Amos......................................... 63,150(4,7) *
Thomas H. Bamford................................. 500 *
Paul W. Brubaker.................................. 3,375(1) *
Ronald E. Frisbie................................. 49,730(1,3,4) *
Donald R. Kaufmann................................ 833(1,2,6) *
Robert A. Kinsley (nominee)....................... -- *
Robert M. Lauman.................................. 48,800(1,2,5,6) *
Thomas E. Morell.................................. 1,816(2,5) *
G. William Ruhl................................... 3,782(1,2,5,6) *
Steven B. Silverman............................... 1,060(6) *
W. Garth Sprecher................................. 96,948(1,2,4,5,6) 1.30%
Anne B. Sweigart.................................. 370,029(1,2,4,5,6) 4.98%
D. Mark Thomas.................................... 1,300(8) *
All Directors and Officers as a group............. 641,323(1,2,3,4,5,6,7,8) 8.63%
</TABLE>
- ------------------
* Less than 1 percent.
(1) Includes shares owned in their individual capacities, but held by the D & E
Communications, Inc. Voting Trust (the "Voting Trust") as of the Most
Practicable Date as follows: 3,375 for Mr. Brubaker, 49,430 for Mr. Frisbie,
300 for Mr. Kaufmann, 44,315 for Mr. Lauman, 672 for Mr. Ruhl, 95,456 for
Mr. Sprecher, 368,806 for Mrs. Sweigart, and 562,354 for all directors and
officers as a group. Mrs. Sweigart and Messrs. Amos, Frisbie and Sprecher
are Voting Trustees of the Voting Trust.
(2) Includes shares held in the Company's Employee Stock Ownership Plan as of
the Most Practicable Date as follows: 442 for Mr. Kaufmann, 872 for Mr.
Lauman, 1,250 for Mr. Morell, 1,404 for Mr. Ruhl, 1,112 for Mr. Sprecher,
462 for Mrs. Sweigart and 5,542 for all directors and officers as a group.
All fractional shares are rounded to the nearest whole share.
(3) Does not include 920 shares owned by Mr. Frisbie's wife, with respect to
which Mr. Frisbie disclaims beneficial ownership.
(4) Does not include shares not owned in their individual capacities, but held
by the Voting Trust for which Mrs. Sweigart and Messrs. Amos, Frisbie and
Sprecher serve as Trustees, and to which each of the Trustees disclaims
beneficial ownership.
(5) Includes shares held in the Company's Employee Stock Purchase Plan as of the
Most Practicable Date as follows: 1,197 for Mr. Lauman, 566 for Mr. Morell,
1,351 for Mr. Ruhl, 359 for Mr. Sprecher, 162 for Mrs. Sweigart and 3,635
for all directors and officers as a group.
(6) Includes shares held in the Company's Dividend Reinvestment Plan as of the
Most Practicable Date as follows: 11 for Mr. Kaufmann, 2,116 for Mr. Lauman,
55 for Mr. Ruhl, 58 for Mr. Silverman, 21 for Mr. Sprecher, 299 for Mrs.
Sweigart and 2,560 for all directors and officers as a group.
(7) Includes shares held in the John Amos Living Trust, of which Mr. Amos is
trustee. Does not include 65,709 owned by the Mary P. Amos Living Trust, of
which Mr. Amos' wife is trustee, and to which Mr. Amos disclaims beneficial
ownership.
(8) Includes 300 shares held as custodian for Emily Thomas and 600 shares held
as custodian for David Thomas for which Mr. Thomas does not disclaim
beneficial ownership.
5
<PAGE>
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
the Company's directors and executive officers, and persons who own more than 10
percent of a registered class of the Company's equity securities, to file
reports of ownership and change in ownership with the Securities and Exchange
Commission and Nasdaq. Directors, executive officers, and other 10 percent
shareholders are required by SEC regulations to furnish the Company with copies
of all Section 16(a) forms they file.
Solely on its review of the copies of such forms or written representations
from certain reporting persons that no Form 5s were required for those persons,
the Company believes that during 1997, all filing requirements under Section
16(a) applicable to its directors and executive officers were met except for
Steven B. Silverman who failed to timely file Forms 4 disclosing changes in his
beneficial ownership.
IDENTIFICATION OF EXECUTIVE OFFICERS
The following table sets forth the names, ages, and positions of the
executive officers of the Company. All executive officers of the Company serve
for terms of one year and until re-appointed or until a successor is duly
appointed at the annual organizational meeting of directors, which follows the
annual shareholders' meeting. No executive officers have any arrangements or
understandings with any other person pursuant to which such executive officer
was or is to be appointed as an executive officer.
<TABLE>
<CAPTION>
POSITION
NAME AGE POSITION HELD SINCE
- ---- --- -------- ----------
<S> <C> <C> <C>
Anne B. Sweigart.................. 83 Chairman, President, and Chief Executive 1985
Officer
Robert M. Lauman.................. 72 Executive Vice President and Chief Operating 1990
Officer
G. William Ruhl................... 58 Senior Vice President 1991
Thomas E. Morell.................. 37 Vice President, Chief Financial Officer and 1995
Treasurer (1)
W. Garth Sprecher................. 46 Vice President and Secretary (1) 1993
Donald R. Kaufmann................ 55 Vice President 1996
</TABLE>
- ------------------
(1) Both Messrs. Morell and Sprecher were elected as a Vice President in 1996.
Mrs. Sweigart's and Messrs. Lauman, Ruhl and Sprecher's biographies are set
forth above in the section entitled "Directors".
Thomas E. Morell, age 37, is Vice President, Chief Financial Officer and
Treasurer of the Company and Chairman of D&E Marketing Corp. Mr. Morell was
Assistant Controller of the Company from 1984 to 1990, Controller from 1990 to
1995 and Chief Financial Officer and Treasurer since August 22, 1995. From 1982
to 1984, he was employed by Coopers & Lybrand L.L.P. as an auditor. Mr. Morell
serves as Treasurer on the Board of Directors of Hands-on-House, Children's
Museum of Lancaster. Mr. Morell is a Certified Public Accountant and is a member
of the Pennsylvania Institute of Certified Public Accountants.
Donald R. Kaufmann, age 55, has been Vice President of the Company and
Chief Executive Officer of the Company's subsidiary, D&E Telephone and Data
Systems, Inc. since 1996. From 1995, when he joined the Company, until 1996, he
served as Managing Director of New Business Ventures. From 1965 to 1995, Mr.
Kaufmann was employed by Bell Atlantic. When Mr. Kaufmann left Bell Atlantic, he
was Director of Network Investment Management.
6
<PAGE>
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table sets forth the compensation received for services to
the Company and its subsidiaries during each of the last three (3) fiscal years
by the Company's CEO and, in addition, the individuals who during 1997 were the
four (4) most highly compensated executive officers of the Company and who
received in excess of $100,000 in salary and bonus.
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
---------------------------------------------------------
OTHER ANNUAL ALL OTHER
SALARY BONUS COMPENSATION COMPENSATION
NAME AND PRINCIPAL POSITION YEAR $ ($)(A) ($)(B) ($)(C)
--------------------------- ---- -------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Anne B. Sweigart .............. 1997 $171,154 $76,500 $ 0 $180,144
Chairman, President & CEO 1996 148,124 21,945 0 160,919
1995 141,131 21,105 0 153,122
Robert M. Lauman .............. 1997 $147,270 $65,925 $ 0 $ 60,672
Executive Vice President 1996 137,730 20,550 0 53,708
& Chief Operating Officer 1995 131,738 19,695 21,263 31,681
G. William Ruhl ............... 1997 $ 88,000 $39,150 $ 0 $ 26,483
Senior Vice President 1996 77,954 11,580 0 25,390
1995 70,000 10,410 0 24,331
Thomas E. Morell .............. 1997 $ 78,769 $34,650 $ 0 $ 9,829
Vice President, Chief 1996 68,415 10,155 0 9,621
Financial Officer and 1995 61,740 8,910 0 4,456
Treasurer
Donald R. Kaufmann ............ 1997 $ 75,385 $43,750 $ 0 $ 15,813
Vice President 1996 69,155 9,750 0 15,511
1995 29,560 4,388 0 14,288
</TABLE>
- ------------------
(A) Bonuses are established pursuant to the Company's Officer Incentive Plan
under performance targets for the year established by the Compensation
Committee.
(B) Except in the case of Mr. Lauman, the aggregate amounts of other annual
compensation paid to the named executive officers did not exceed the lesser
of (i) $50,000 or (ii) 10% of the total annual salary and bonus reported for
each individual. In 1995, amounts paid to Mr. Lauman include an initiation
and membership fee of $13,820, which was greater than 25% of his total
"other annual compensation" in such year.
(C) The amounts shown in this column are for the following persons for the
following items in the years 1997, 1996, and 1995, respectively: (i) Anne B.
Sweigart: $19,470, $19,684, and $19,919 for Split Dollar Life Insurance;
$3,374, $2,926, and $2,672 for the 401(k) Company Match; $144,800, $126,709,
and $119,531 Pension Benefits (over age 70 1/2); $12,500, $11,600 and
$11,000 for Director's fees; (ii) Robert M. Lauman: $15,432, $15,606, and
$15,790 for the Split Dollar Life Insurance; $0, $0, and $2,256 for Term
Life Insurance; $2,938, $2,714, and $2,635 for the 401(k) Company Match;
$29,802, $23,588 and $0 for Pension Benefits (over age 70 1/2); $12,500,
$11,800 and $11,000 for Director's fees; (iii) G. William Ruhl: $11,773,
$11,781, and $11,781 for the Split Dollar Life Insurance; $450, $450, and
$450 for Term Life Insurance; $1,760, $1,559, and $1,400 for the 401(k)
Company Match; $12,500, $11,600 and $10,700 for Director's fees; (iv) Thomas
E. Morell: $3,188, $3,187, and $3,185 for the Split Dollar Life Insurance;
$66, $66, and $36 for Term Life Insurance; $1,575, $1,368, and $1,235 for
the 401(k) Company Match; $5,000, $5,000 and $0 for Director's meeting
attendance fees; (v) Donald R. Kaufmann: $13,856, $13,901, and $13,878 for
the Split Dollar Life Insurance; $450, $288, and $60 for Term Life
Insurance; $1,507, $1,382, and $350 for the 401(k) Company Match.
7
<PAGE>
Compensation Committee Report On Executive Compensation
The Company's executive compensation program is administered by the
Compensation Committee (the "Committee") comprised of Directors Steven B.
Silverman (Chairman), John Amos, Thomas H. Bamford, and Robert M. Lauman.
In establishing the base salaries of the executive officers of the Company,
including the Chief Executive Officer, Mrs. Sweigart, the Committee considers a
number of factors including (i) salary ranges for comparable positions at other
companies; (ii) the historical financial performance of the Company (including
such indicators as gross revenues, operating income, net income, earnings per
share and earnings before interest, taxes, depreciation and amortization
(EBITDA); (iii) the level of responsibility of the employee; and (iv) the level
of inflation for the period. However, compensation decisions are not based upon
any precise formula and no factor is accorded any greater weight than other
factors. For 1997, a compensation consultant retained by the Committee developed
recommended salary ranges for executive officers of the Company based on a
comparison of salaries paid at comparable companies for positions with
equivalent levels of responsibility. (There is, however, no intentional relation
between the companies used for compensation purposes and the companies in the
NASDAQ Telecommunications Index (Nasdaq Telecom) used in the Stock Performance
Graph on page 10.) Using the consultant's recommendations, and based on the
Committee's evaluation of the factors listed above, the base salary of the Chief
Executive Officer was increased by 15.5% for 1997 from 1996.
The Company also provides an annual incentive opportunity to the Company's
executive officers pursuant to the Company's Officer Incentive Plan, which has
been approved by the Board of Directors. Under the Plan, the Committee
establishes performance targets for EBITDA for the year. In 1997, the
performance goals established by the Committee at the beginning of the year were
achieved, and bonuses were paid accordingly.
Respectfully Submitted,
The Compensation Committee
Steven B. Silverman
John Amos
Thomas H. Bamford
Robert M. Lauman
8
<PAGE>
Compensation Committee Interlocks and Insider Participation
During the year ended December 31, 1997, Messrs. Silverman (Chairman),
Amos, Bamford and Lauman served on the Compensation Committee of the Board. Mr.
Lauman is an executive officer of the Company.
Pension Plan Table
The Company's pension plan is a noncontributory defined benefit plan
computed on an actuarial basis covering all eligible employees. The plan
provides benefits based on years of service and the employee's compensation as
the average of the highest three years of the previous ten years prior to
retirement. Accrued benefits are vested after five years of service. Normal
retirement age is 65, but an employee who has attained the age of 55 and has at
least 25 years of service (The Rule of Eighty) may retire without any actuarial
reduction of his benefit. Benefit amounts are not subject to any reduction for
Social Security or other amounts.
The following table illustrates the maximum annual benefit payable upon
retirement pursuant to the Company's pension plan for employees with specified
average final compensation and years of service, assuming normal retirement age
and payment as a single life annuity.
AVERAGE YEARS OF SERVICE
FINAL -----------------------------------------------
COMPENSATION 15 20 25 30 35
- --------------------- ------- ------- ------- ------- -------
$100,000 $24,000 $32,000 $40,000 $48,000 $56,000
110,000 26,400 35,200 44,000 52,800 61,600
120,000 28,800 38,400 48,000 57,600 67,200
130,000 31,200 41,600 52,000 62,400 72,800
140,000 33,600 44,800 56,000 67,200 78,400
150,000 36,000 48,000 60,000 72,000 84,000
160,000 38,400 51,200 64,000 76,800 89,600
170,000 40,800 54,400 68,000 81,600 95,200
180,000 43,200 57,600 72,000 86,400 100,800
190,000 45,600 60,800 76,000 91,200 106,400
200,000 48,000 64,000 80,000 96,000 112,000
Compensation included in the pension plan base consists of the base salary
and bonus shown in the Salary and Bonus columns of the Summary Compensation
Table. The years of service for purposes of the pension plan, as of December 31,
1997, were for Mrs. Sweigart 61 years, Mr. Lauman 14 years, Mr. Ruhl 6 years,
Mr. Morell 13 years and Mr. Kaufmann 2 years.
9
<PAGE>
STOCK PERFORMANCE GRAPH
The following is a graphical comparison of five-year cumulative total
return on shares of the Company's Common Shares. The comparison assumes $100
invested in each of the Nasdaq U.S. and Foreign Index (Nasdaq US & Foreign), the
Nasdaq Telecommunications Index (Nasdaq Telecom) and the Company's Common Stock,
on December 31, 1992 and that all dividends were reinvested. The comparison was
changed from the prior years which used the Standard and Poor's 500 Index and
the S & P Telephone Index. Because the Company's shares are traded on the Nasdaq
market, it is believed the Nasdaq comparisons are more representative. The
change made no material difference in the current year's presentation.
[GRAPHIC]
In the printed version of the document, a line graph
appears which depicts the following plot points:
<TABLE>
<CAPTION>
1992 1993 1994 1995 1996 1997
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
Nasdaq U.S.
& Foreign $100.00 $115.76 $112.28 $157.69 $193.09 $236.22
Nasdaq
Telecom $100.00 $154.19 $128.69 $168.51 $172.29 $254.48
D & E $100.00 $158.81 $201.02 $223.49 $221.28 $170.41
</TABLE>
The Common Stock is currently traded on The Nasdaq Stock Market National
Market ("NASDAQ") under the Symbol DECC. Prior to being traded on the NASDAQ,
the Common Stock was traded on the over-the-counter market. For the years
represented on the graph, the comparative prices are an average of the high and
low closing prices of the Common Stock on the last trading day before the
beginning of each fiscal year reported above, as reported on the interdealer
quotation system and summarized in the "Pink Sheets" published by the National
Quotation Bureau. Such quotations reflect inter-dealer prices, without retail
mark-up, mark-down or commission and may not necessarily represent actual
transactions.
10
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following Common Stock ownership information is shown as of the Record
Date.
<TABLE>
<CAPTION>
AMOUNT AND NATURE OF PERCENT
NAME AND ADDRESS OF BENEFICIAL OWNER BENEFICIAL OWNERSHIP OF CLASS
------------------------------------ ----------------------- --------
<S> <C> <C>
The Voting Trust D & E Communications, Inc. ............. 2,975,444(1) 40.03%
(the "Voting Trust")
P.O. Box 458
Ephrata, PA 17522
Southwestern Investments, Inc. .......................... 1,300,000 17.49%
High Ridge Park
Stamford, CT 06905
The Ephrata National Bank, Trustee of the William and
Jemima Brossman Charitable Foundation (the "Charitable
Foundation") .......................................... 1,100,100(2) 14.80%
P.O. Box 457
Ephrata, PA 17522
Anne B. Sweigart ........................................ 370,029(3) 4.98%
207 East Main Street
Ephrata, PA 17522
</TABLE>
- ------------------
(1) Certain shareholders are parties to that certain Voting Trust Agreement,
dated as of November 19, 1992, pursuant to which the Voting Trustees named
therein have the right to exercise sole voting power on all matters
submitted to the Company's shareholders for a vote, but not investment
power, with respect to the shares held by such shareholders. By its terms,
the Voting Trust expires November 18, 2002. The Trustees of the Voting Trust
are Anne B. Sweigart, Ronald E. Frisbie, W. Garth Sprecher, Kay W. Shober
and John Amos, each of whom, except for Mr. Shober, is a director of the
Company. Each of the Voting Trustees disclaims beneficial ownership of the
shares held by the Voting Trust, except such shares held by each individual
Trustee as a participant in the Voting Trust.
(2) The Charitable Foundation is a member of the Voting Trust. Therefore, the
number of shares shown above as held by the Charitable Foundation is also
included in the number of shares shown above held by the Voting Trust. The
Ephrata National Bank, as trustee of the Charitable Foundation, exercises
sole investment power, but not the voting power, with respect to the shares
held by the Charitable Foundation.
(3) Mrs. Sweigart is a member of the Voting Trust and has the sole investment
power, but not the voting power, with respect to these shares (except in her
capacity as a Voting Trustee). Therefore, the number of shares shown above
as held by Mrs. Sweigart is also included in the number of shares shown
above as held by the Voting Trust.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. Steven B. Silverman, a director of the Company, is a senior partner in
the law firm of Rothenberg, Silverman and Furman PC which is currently retained
as counsel to the Company.
Mr. D. Mark Thomas, of the Company, is a partner in the law firm of Thomas,
Thomas, Armstrong & Niesen, which is currently retained as counsel to the
Company.
Mrs. Anne B. Sweigart, Chairman of the Board, President and Chief Executive
Officer, is the aunt of W. Garth Sprecher, Vice President and Secretary of the
Company.
THE BOARD RECOMMENDS THE ELECTION OF ITS FOUR (4) NOMINEES AS CLASS C
DIRECTORS.
11
<PAGE>
PROPOSAL 2:
RATIFICATION OF INDEPENDENT ACCOUNTANTS
The Board, upon recommendation of its Audit Committee, appointed Coopers &
Lybrand L.L.P., as accountants of the Company's Financial Statements for 1998.
The recommendation is being submitted to the Shareholders for approval, which
requires the affirmative vote of a majority of the votes cast by all
shareholders entitled to vote thereon. A representative of Coopers & Lybrand
L.L.P., is expected to be present at the Annual Meeting and will be available to
respond to appropriate questions and have the opportunity to make a statement if
they desire to do so.
THE BOARD RECOMMENDS THE SHAREHOLDERS VOTE IN FAVOR OF RATIFYING COOPERS &
LYBRAND L.L.P. AS INDEPENDENT ACCOUNTANTS FOR 1998.
1999 SHAREHOLDER PROPOSALS
Proposals of shareholders intended for inclusion in the Company's proxy
statement relating to the 1999 Annual Meeting must be received at the Company's
principal executive offices, 124 East Main Street, Ephrata, PA 17522 (please
address to the attention of W. Garth Sprecher, Vice President and Secretary), no
later than Friday, November 27, 1998. Any such proposal must comply with Rule
14a-8 of Regulation 14A of the proxy rules of the Securities and Exchange
Commission.
OTHER MATTERS
The Board is not aware that any matter other than those listed in the
Notice of 1998 Annual Meeting of Shareholders is to be presented for action at
the Annual Meeting. If any of the Board's nominees are unavailable for election
as a director or if any matter should properly come before the Annual Meeting,
it is intended that votes will be cast pursuant to the proxy in respect thereof
in accordance with the best judgment of the person or persons acting as proxies.
Any Shareholder who executes and returns the proxy may revoke the same at
any time before it is exercised by filing with the Secretary of the Company
written notice of such revocation or a duly executed proxy bearing a later date
or by attending the Annual Meeting and voting in person. Attendance at the
Annual Meeting will not in and of itself constitute revocation of a proxy.
The Company will pay the expenses in connection with printing, assembling
and mailing the Notice of 1998 Annual Meeting of Shareholders, this Proxy
Statement and the accompanying form of proxy. In addition to the use of mails,
proxies may be solicited by directors, officers and other employees of the
Company personally or by telephone. The Company may request persons holding
stock in their names or names of nominees to send proxy material to, and obtain
proxies from, their principals, and the Company will reimburse such persons for
their expense in so doing.
Items included in this Proxy Statement are as of December 31, 1997, unless
otherwise stated.
UPON WRITTEN REQUEST BY ANY SHAREHOLDER TO W. GARTH SPRECHER, VICE
PRESIDENT AND SECRETARY, D & E COMMUNICATIONS, INC., 124 EAST MAIN STREET,
EPHRATA, PA 17522, A COPY OF THE COMPANY'S 1997 ANNUAL REPORT ON FORM 10-K FOR
THE YEAR ENDED DECEMBER 31, 1997 WILL BE PROVIDED WITHOUT CHARGE.
April 3, 1998
12
<PAGE>
PARTICIPANT'S DIRECTION
D&E Communications, Inc.
DIVIDEND REINVESTMENT PLAN
To: D&E Communications, Inc. as Trustee of the D&E Communications, Inc.
Dividend Reinvestment Plan
Pursuant to your notice accompanied by the proxy material in connection with the
1998 Annual Meeting of Shareholders of D&E Communications, Inc., to be held on
Thursday, April 30, 1998, at 10:30 a.m., I direct you to execute a proxy in the
form solicited by the Board of Directors of D&E Communications, Inc. with
respect to all shares of Common Stock, par value $0.16, to which I have the
right to give voting directions under the D&E Communications, Inc. Dividend
Reinvestment Plan as follows:
(IMPORTANT -- TO BE SIGNED AND DATED ON REVERSE SIDE)
1. ELECTION OF FOUR (4) DIRECTORS
NOMINEES: For the Class C Directors Whose Terms Expire in 2001: Anne B.
Sweigart, Paul W. Brubaker and Steven B. Silverman. Additional nominee
to fill Class C vacancy: Robert A. Kinsley
[ ] FOR all nominees listed (except as marked to the contrary below)
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
the nominee's name on the line below.)
---------------------------------------------------------
<PAGE>
2. RATIFICATION OF INDEPENDENT ACCOUNTANTS
[ ] for [ ] against [ ] abstain
THIS PARTICIPANT'S DIRECTION, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE
MANNER DIRECTED HEREIN BY THE UNDERSIGNED PARTICIPANT. IF NO DIRECTION IS MADE,
THIS PARTICIPANT'S DIRECTION WILL BE VOTED FOR THE LISTED NOMINEES IN THE
ELECTION OF THE FOUR (4) DIRECTORS, FOR RATIFICATION OF INDEPENDENT ACCOUNTANTS
AND IN ITS DISCRETION, THE TRUSTEE IS AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY POSTPONEMENT OR
ADJOURNMENT THEREOF. IF NECESSARY, CUMULATIVE VOTING RIGHTS WILL BE EXERCISED TO
SECURE THE ELECTION OF AS MANY AS POSSIBLE OF THE BOARD OF DIRECTORS' NOMINEES.
DATE:_______________________________________________ , 1998
___________________________________________________________
___________________________________________________________
Participant(s) sign above exactly as name is printed on
label. If signing as representative, so indicate. For joint
accounts, all owners should sign.
<PAGE>
PARTICIPANT'S DIRECTION
Denver and Ephrata Telephone and Telegraph Company
Employee Stock Ownership Plan
To: CoreStates Bank, as Trustee of the Denver and Ephrata Telephone and
Telegraph Company Employee Stock Ownership Plan
Pursuant to your notice accompanied by the proxy material in connection with the
1998 Annual Meeting of Shareholders of D&E Communications, Inc., to be held on
Thursday, April 30, 1998, at 10:30 a.m., I direct you to execute a proxy in the
form solicited by the Board of Directors of D&E Communications, Inc. with
respect to all shares of Common Stock, par value $0.16, to which I have the
right to give voting directions under the Denver and Ephrata Telephone and
Telegraph Company Employee Stock Ownership Plan as follows:
(IMPORTANT -- TO BE SIGNED AND DATED ON REVERSE SIDE)
1. ELECTION OF FOUR (4) DIRECTORS
NOMINEES: For the Class C Directors Whose Terms Expire in 2001: Anne B.
Sweigart, Paul W. Brubaker and Steven B. Silverman. Additional
nominee to fill Class C vacancy: Robert A. Kinsley
[ ] FOR all nominees listed (except as marked to the contrary below)
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
the nominee's name on the line below.)
---------------------------------------------------------
<PAGE>
2. RATIFICATION OF INDEPENDENT ACCOUNTANTS
[ ] for [ ] against [ ] abstain
THIS PARTICIPANT'S DIRECTION, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE
MANNER DIRECTED HEREIN BY THE UNDERSIGNED PARTICIPANT. IF NO DIRECTION IS MADE,
THIS PARTICIPANT'S DIRECTION WILL BE VOTED FOR THE LISTED NOMINEES IN THE
ELECTION OF THE FOUR (4) DIRECTORS, FOR RATIFICATION OF INDEPENDENT ACCOUNTANTS
AND IN ITS DISCRETION, THE TRUSTEE IS AUTHORIZED TO VOTE UPON SUCH OTHER
BUSINESS AS MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY POSTPONEMENT OR
ADJOURNMENT THEREOF. IF NECESSARY, CUMULATIVE VOTING RIGHTS WILL BE EXERCISED TO
SECURE THE ELECTION OF AS MANY AS POSSIBLE OF THE BOARD OF DIRECTORS' NOMINEES.
DATE:_______________________________________________ , 1998
___________________________________________________________
Participant sign above exactly as name is printed on label.
<PAGE>
PROXY
D&E Communications, Inc.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF THE COMPANY.
Anne B. Sweigart, Robert M. Lauman and W. Garth Sprecher, or any one or more of
them with power of substitution in each, are hereby authorized to represent the
undersigned at the 1998 Annual Meeting of Shareholders of D&E Communications,
Inc., to be held at the Brossman Business Complex, 124 East Main Street,
Ephrata, Pennsylvania, on Thursday, April 30, 1998, at 10:30 a.m., and at any
adjournment thereof, and thereat to vote the same number of shares as the
undersigned would be entitled to vote if then personally present.
(IMPORTANT -- TO BE SIGNED AND DATED ON REVERSE SIDE)
1. ELECTION OF FOUR (4) DIRECTORS
NOMINEES: For the Class C Directors Whose Terms Expire in 2001: Anne B.
Sweigart, Paul W. Brubaker and Steven B. Silverman. Additional
nominee to fill Class C vacancy: Robert A. Kinsley
[ ] FOR all Nominees listed (except as marked to the contrary below)
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
the nominee's name on the line below.)
____________________________________________________________________
<PAGE>
2. RATIFICATION OF INDEPENDENT ACCOUNTANTS
[ ] for [ ] against [ ] abstain
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED HEREIN
BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR THE LISTED NOMINEES IN THE ELECTION OF THE FOUR (4) DIRECTORS, FOR
RATIFICATION OF INDEPENDENT ACCOUNTANTS AND IN THEIR DISCRETION, THE PROXIES ARE
AUTHORIZED TO VOTE UPON SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE
ANNUAL MEETING OR ANY POSTPONEMENT OR ADJOURNMENT THEREOF. IF NECESSARY,
CUMULATIVE VOTING RIGHTS WILL BE EXERCISED TO SECURE THE ELECTION OF AS MANY AS
POSSIBLE OF THE BOARD OF DIRECTORS' NOMINEES.
DATE:_______________________________________________ , 1998
___________________________________________________________
___________________________________________________________
Shareholder(s) sign above exactly as name is printed on
label. If signing as representative, so indicate. For joint
accounts, all owners should sign.
