<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
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-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 240.14a-11(c) or Rule 240.14a-12
CHOICETEL COMMUNICATIONS
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
N/A
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
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 (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.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
-----------------------------------------------------------------------
(3) Filing Party:
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(4) Date Filed:
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<PAGE>
CHOICETEL COMMUNICATIONS, INC.
9724 10TH AVENUE NORTH
PLYMOUTH, MINNESOTA 55441
(612) 544-1260
------------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 27, 1998
------------------------
TO THE SHAREHOLDERS OF
CHOICETEL COMMUNICATIONS, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Choicetel
Communications, Inc., a Minnesota corporation (the "Company"), will be held on
Wednesday, May 27, 1998, at 3:30 p.m. (Minneapolis time), at the Conference
Center in the offices of Robins, Kaplan, Miller & Ciresi L.L.P., 2800 LaSalle
Plaza, 800 LaSalle Avenue, Minneapolis, Minnesota 55402, for the following
purposes:
1. To elect five directors of the Company for the coming year.
2. To transact such other business as may properly come before the meeting
or any adjournment thereof.
Holders of record of the Company's Common Stock at the close of business on
April 17, 1998 are entitled to notice of and to vote at the Annual Meeting or
any adjournment thereof.
Each of you is invited to attend the Annual Meeting in person if possible.
Whether or not you plan to attend in person, please mark, date and sign the
enclosed proxy, and mail it promptly. A return envelope is enclosed for your
convenience.
By Order of the Board of Directors
Melvin Graf, SECRETARY
April 30, 1998
WHETHER OR NOT YOU EXPECT TO ATTEND THE ANNUAL MEETING, PLEASE SIGN THE
PROXY AND RETURN IT IN THE ENCLOSED ENVELOPE.
<PAGE>
CHOICETEL COMMUNICATIONS, INC.
9724 10TH AVENUE NORTH
PLYMOUTH, MINNESOTA 55441
(612) 544-1260
------------------------
PROXY STATEMENT
---------------------
SOLICITATION OF PROXIES
The enclosed proxy is solicited by and on behalf of the Board of Directors
of Choicetel Communications, Inc., a Minnesota corporation (the "Company"), for
use at the Annual Meeting of Shareholders ("Annual Meeting") to be held on May
27, 1998, and any adjournment thereof. This Proxy Statement and the accompanying
form of proxy are being mailed to shareholders on or about April 30, 1998.
The expense of the solicitation of proxies for the Annual Meeting, including
the cost of mailing, has been or will be borne by the Company. Arrangements will
be made with brokerage houses and other custodian nominees and fiduciaries to
send proxies and proxy materials to their principals, and the Company will
reimburse them for their expense in so doing. In addition to solicitation by
mail, proxies may be solicited by telephone, telegraph or personally.
VOTING AND REVOCATION OF PROXY
Only shareholders of record at the close of business on April 17, 1998 (the
"Record Date") will be entitled to vote at the Annual Meeting. On the Record
Date, there were 2,915,006 shares of Common Stock outstanding. Holders of record
of the Company's Common Stock on the Record Date are entitled to notice of and
to vote at the Annual Meeting. Each share of Common Stock entitles the holder
thereof to one vote upon each matter to be presented at the Annual Meeting.
Each proxy returned to the Company will be voted in accordance with the
instructions indicated thereon. If no instructions are indicated, the shares
will be voted FOR the election of the nominees for the Board of Directors named
in this Proxy Statement. While the Board of Directors knows of no other matters
to be presented at the Annual Meeting or any adjournment thereof, all proxies
returned to the Company will be voted on any such matter in accordance with the
judgment of the proxy holders.
Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before it is voted. Proxies may be revoked by (a) giving
written notice of such revocation to the Secretary of the Company, (b) giving
another written proxy bearing a later date, or (c) attending the Annual Meeting
and voting in person (although attendance at the Annual Meeting will not in and
of itself constitute a revocation of a proxy).
A quorum, consisting of a majority of the shares of Common Stock entitled to
vote at the Annual Meeting, must be present in person or by proxy before action
may be taken at the Annual Meeting. If an executed proxy is returned and the
shareholder has abstained from voting on any matter, the shares represented by
such proxy will be considered present at the meeting for purposes of determining
a quorum and for purposes of calculating the vote, but will not be considered to
have been voted in favor of such matter. If an executed proxy is returned by a
broker holding shares in "street name" which indicates that the broker does not
have discretionary authority as to certain shares to vote on one or more
matters, such shares will be considered present at the meeting for purposes of
determining a quorum, but will not be considered to be represented at the
meeting for purposes of calculating the vote with respect to such matter.
1
<PAGE>
ELECTION OF DIRECTORS
(PROPOSAL 1)
The business and affairs of the Company are managed under the direction of
its Board of Directors. Each director is elected for a term of one year or until
his or her successor is elected.
Shareholders will be asked at the Annual Meeting to elect five directors.
The Board has nominated the five individuals named below to serve as directors
of the Company. Unless authority is withheld, all proxies received in response
to this solicitation will be voted FOR the election of the nominees named below.
Each of the nominees named below is now a director of the Company and has served
continuously as a director since the year indicated. Each of the nominees was
elected by the shareholders at the 1997 Annual Meeting, except for Mr. Hegstrom
and Mr. Wigley who were appointed by the Board of Directors in June 1997 and
January 1998, respectively. All nominees have indicated a willingness to serve
if elected. If any nominee becomes unable to serve prior to the Annual Meeting,
the proxies received in response to this solicitation will be voted for a
replacement nominee selected in accordance with the best judgment of the proxy
holders named therein.
<TABLE>
<CAPTION>
DIRECTOR
NAME POSITIONS WITH COMPANY AGE SINCE
- ---------------------------- -------------------------------------------------------------------- --- -----------
<S> <C> <C> <C>
Gary S. Kohler.............. Chairman of the Board of Directors 41 1989
Jeffrey R. Paletz........... President and Director 42 1989
Melvin Graf................. Executive Vice President, Secretary and a Director 42 1989
Robert A. Hegstrom.......... Director 55 1997
Michael Wigley.............. Director 44 1998
</TABLE>
SHAREHOLDER APPROVAL
The affirmative vote of a plurality of the shares of Common Stock
represented at the Annual Meeting either in person or by proxy, assuming a
quorum is present, is required for the election of directors.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
ELECTION OF THE NOMINEES FOR THE BOARD OF DIRECTORS AS SET FORTH IN PROPOSAL 1.
INFORMATION CONCERNING DIRECTORS AND NOMINEES
DIRECTORS AND NOMINEES
All of the nominees for election to the Company's Board of Directors are
presently serving as directors of the Company. The following discussion sets
forth certain information concerning the directors and nominees of the Company.
GARY S. KOHLER is a founder and has served as Chairman of the Board of
Directors of the Company since its inception in 1989. Mr. Kohler is President of
Kohler Capital Management, Inc., an investment management firm which he formed
in October 1997. From July to October 1997, Mr. Kohler was a partner in
Tarmachan Capital Management, an investment management firm. Prior to that and
since 1984, he was employed as Vice President of Okabena Company, a private
holding company. Mr. Kohler serves on the board of Northwest Mortgage Services,
Inc. Mr. Kohler has an M.B.A. degree from Cornell University and a B.A. degree
from the University of Minnesota. Mr. Kohler is the brother of Jack S. Kohler.
JEFFREY R. PALETZ is a founder of the Company, has been a director since its
inception and has been President since 1993, overseeing all operations of the
Company. Prior to founding the Company in 1989, Mr. Paletz was employed for 13
years at Sportsman's Guide, a mail order retailer, where he oversaw the computer
data operations. Mr. Paletz has a B.S. degree in Business from the University of
Minnesota.
2
<PAGE>
MELVIN GRAF is a founder of the Company, has been a director since its
inception and has been Executive Vice President and Secretary since 1993,
overseeing all marketing and leasing activities. Mr. Graf served as President of
the Company until 1993. Prior to founding the Company in 1989, Mr. Graf was
President of Network Travel, a Minneapolis travel agency, for five years. Mr.
Graf has a B.S. degree in Business from the University of Minnesota.
ROBERT A. HEGSTROM became a director of the Company in June 1997. In January
1997, Mr. Hegstrom joined Northwest Services, Inc. as Chairman, President and
Chief Executive Officer. Prior to that, he was a private investor for two years
and, from December 1991 to January 1995, he was Executive Vice President of
Green Tree Financial Corporation.
MICHAEL WIGLEY became a director in January 1998. Since 1989 Mr. Wigley has
been President and Chief Financial Officer of Great Plains Companies, Inc., a
diversified holding company. Mr. Wigley has an M.B.A. from Harvard Business
School, a M.S. from Stanford University and a B.S. degree from the University of
Minnesota.
BOARD COMMITTEES AND ACTIONS
During calendar year 1997, the Board of Directors met four times. The Board
of Directors has two standing committees, a Compensation Committee and an Audit
Committee which were appointed in January, 1998. During 1997, each director
attended at least 75% of the total number of meetings of the Board.
The Compensation Committee will review and make recommendations to the Board
of Directors regarding salaries, compensation and benefits of executive officers
of the Company and will administer the Company's 1997 Long-Term Incentive and
Stock Option Plan. The Committee members are Robert A. Hegstrom, Gary S. Kohler
and Jeffrey R. Paletz.
The Audit Committee is responsible for recommending the appointment of a
firm of independent public accountants to audit the books and records of the
Company and its subsidiary, will review the internal and external financial
reporting of the Company and the scope of the independent audit. The Committee
members are Michael Wigley, Robert A. Hegstrom and Gary S. Kohler.
The Board of Directors acts as the nominating committee. See "Information
Concerning Directors and Nominees."
DIRECTOR COMPENSATION
No cash compensation is paid to the Company's directors. Independent,
non-employee directors (Mr. Hegstrom and Mr. Wigley) received an option to
purchase $75,000 of Common Stock, valued as of the date of grant. The options
were issued pursuant to the Company's 1997 Long-Term Incentive and Stock Option
Plan, are exercisable upon grant and have five-year term and an exercise price
equal to the fair market value of the Common Stock as of the date of grant. No
options will be issued to employee directors for their service as directors.
EXECUTIVE OFFICERS
The following discussion sets forth information about the executive officers
of the Company who are not directors.
<TABLE>
<CAPTION>
OFFICER
NAME POSITIONS WITH COMPANY AGE SINCE
- ---------------------- --------------------------------------------------------------------------- --- -----------
<S> <C> <C> <C>
Jack S. Kohler........ Vice President and Chief Financial Officer 43 1993
Dustin Elder.......... Vice President 29 1997
Michael Kuban......... Controller 49 1998
</TABLE>
3
<PAGE>
JACK S. KOHLER has been Vice President and Chief Financial Officer of the
Company since 1993. Prior to joining the Company, Mr. Kohler was employed for 13
years in various management and accounting positions at Cargill, Inc., where he
most recently served in the internal audit division. Mr. Kohler has a B.S.
degree in Accounting from the University of Minnesota. Mr. Kohler is the brother
of Gary S. Kohler.
DUSTIN ELDER became a Vice President of the Company in August 1997. Mr.
Elder had been President of Communications Assisted Technologies, Inc. for three
years prior to joining the Company. Prior to that, he was a student at the
University of Iowa where he earned a B.S. degree in Mathematics and Computer
Science.
MICHAEL KUBAN became Controller of the Company in January 1998. Prior to
joining the Company, Mr. Kuban was employed for 26 years with Unisys Corporation
in various financial management positions. Mr. Kuban has a B.S. degree in
Business administration from Pennsylvania State University.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table and accompanying footnotes set forth certain summary
information, relating to the three years ended December 31, 1997, with respect
to the Company's Chief Executive Officer and the Company's three other most
highly compensated executive officers during 1997.
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
AWARDS
ANNUAL COMPENSATION ---------------------
------------------------------------------------------ SECURITIES
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION($) OPTIONS/SARS(#) COMPENSATIONS
- ------------------------------ --------- --------- --------- --------------------- --------------------- -------------------
<S> <C> <C> <C> <C> <C> <C>
Jeffrey R. Paletz,............ 1997 $ 77,350 $ 15,476 -- -- --
President 1996 70,000 10,000 -- -- --
1995 63,000 10,000 -- -- --
Jack S. Kohler,............... 1997 $ 87,600(1) $ 19,080 -- -- --
Vice President and 1996 62,000(1) 6,000 -- -- --
Chief Financial Officer 1995 62,000(1) 6,000 -- -- --
Melvin Graf,.................. 1997 $ 70,000 $ 10,480 -- -- --
Executive Vice President 1996 62,000 6,000 -- -- --
1995 56,000 6,000 -- -- --
Dustin Elder,................. 1997 $ 54,000(2) $ 1,000 -- -- --
Vice President --
--
</TABLE>
- ------------------------
(1) Includes 6,000 shares of the Company's common stock issued in lieu of cash
compensation valued at $4.00 in 1997 and $1.00 per share in 1996 and 1995.
(2) Mr. Elder joined the Company in 1997.
EMPLOYMENT AGREEMENTS
The Company has entered into employment agreements with Jeffrey R. Paletz,
Melvin Graf and Jack S. Kohler effective April 15, 1997, and an employment
agreement with Dustin Elder effective August 14, 1997, all of which provide for
an initial term expiring in April 1999, with automatic one-year renewals. The
agreements provide a base salary and the right to receive additional
compensation in the form of salary, bonus and other benefits as the Board of
Directors shall determine in its sole discretion. The agreements prohibit each
officer from competing against the Company for a period of one year after
4
<PAGE>
employment ceases and from communicating with a site provider until six months
following expiration of the site agreement. In the event of termination of the
officer's employment, except a termination for cause, the terminated officer is
entitled to receive full compensation and benefits for a six-month period.
BONUS PROGRAM
In 1997, the Company implemented its Incentive Compensation Plan to provide
an opportunity for executive officers and other Company employees to receive a
bonus based on individual and Company performance. The maximum bonus for any
executive officer will be 40% of annual salary. The bonus opportunity for
Jeffrey R. Paletz, the Company's President, depends on the Company's realizing
targeted earnings per share. The bonus opportunities for other executive
officers depend on the success rate for new installations of payphones and the
number of completed acquisitions. The bonus opportunity for other Company
employees is discretionary and not subject to specific criteria.
STOCK OPTION PLAN
Under the terms of the Company's 1997 Long-Term Incentive and Stock Option
Plan (the "Stock Option Plan"), all of the directors, officers, other employees
and consultants of the Company are eligible to receive options to purchase
shares of the Company's Common Stock as part of their compensation package.
The Board of Directors adopted the Stock Option Plan on April 17, 1997, and
the shareholders approved it on April 18, 1997. The Stock Option Plan provides
for the grant both of incentive stock options intended to qualify for
preferential tax treatment under Section 422 of the Internal Revenue Code of
1986, as amended, and nonqualified stock options that do not qualify for such
treatment. The exercise price of incentive stock options must equal or exceed
the fair market value of the Common Stock at the time of grant. The exercise
price of non-qualified stock options must equal or exceed 85% of the fair market
value of the Common Stock at the time of grant. The Stock Option Plan also
provides for grants of stock appreciation rights, restricted stock awards and
performance awards and allows for the grant of restoration options.
The Compensation Committee of the Board of Directors administers the Stock
Option Plan, subject to approval of the Board. A total of 100,000 shares of
Common Stock are reserved for issuance under the Stock Option Plan. Incentive
stock options may be granted under the Stock Option Plan only to any full or
part-time employees, directors who are not employees, and consultants and
independent contractors to the Company are eligible to receive options which do
not qualify as incentive stock options, as well as other awards. In determining
the persons to whom options and awards shall be granted and the number of shares
subject to each, the Board of Directors may take into account the nature of
services rendered by the Company, and such other factors as the Board of
Directors in its discretion shall deem relevant.
The Board of Directors may amend or discontinue the Stock Option Plan at any
time but may not, without shareholder approval, make any revisions or amendments
to the Stock Option Plan that increase the number of shares subject to the Stock
Option Plan, decrease the minimum exercise price, extend the maximum exercise
term, or modify eligibility requirements. The Board of Directors may not alter
or impair any award granted under the Stock Option Plan without the consent of
the holder of the award. The Stock Option Plan will expire April 15, 2007.
Pursuant to the terms of the Stock Option Plan, appropriate adjustments to
the Stock Option Plan and outstanding options will be made in the event of
changes in the Common Stock through merger, consolidation, reorganization,
recapitalization, stock dividend, stock split, or other change in corporate
structure.
5
<PAGE>
The following table sets forth certain information regarding stock options
granted to the executive officers named in the Summary Compensation Table during
the Company's 1997 fiscal year.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
INDIVIDUAL GRANTS RATES OF STOCK PRICE
------------------------------------
PERCENT OF TOTAL APPRECIATION FOR OPTION
OPTIONS
GRANTED TO TERM(1)
OPTIONS GRANTED EMPLOYEES IN EXERCISE PRICE EXPIRATION --------------------------
NAME (#) 1997 ($/SH) DATE 5%($) 10%($)
- ---------------------------------- --------------- ------------------- --------------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Dustin Elder...................... 20,000 100 $ 6.75 8/13/2000 0 0
</TABLE>
The following table sets forth certain information regarding the number and
value of unexercised stock options held by the executive officers named in the
Summary Compensation Table as of the end of the Company's fiscal year ended
December 31, 1997.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF UNEXERCISED
OPTIONS AT YEAR-END(#)
SHARES -----------------------
ACQUIRED ON VALUE EXERCISABLE/
NAME EXERCISE(#) REALIZED($) UNEXERCISABLE
- ----------------------------------------- ----------------- ----------------- -----------------------
<S> <C> <C> <C>
Dustin Elder............................. 0 0 20,000
Jack S. Kohler........................... 0 0 50,000
<CAPTION>
VALUE OF UNEXERCISED
IN-THE-MONEY OPTIONS
AT YEAR-END($)(1)
---------------------------
EXERCISABLE/
NAME UNEXERCISABLE
- ----------------------------------------- ---------------------------
<S> <C>
Dustin Elder............................. 0
Jack S. Kohler........................... 0
</TABLE>
CERTAIN TRANSACTIONS
The Company had an arrangement with Gary S. Kohler, the Company's Chairman
of the Board, pursuant to which Mr. Kohler advises the Company's management on
an as-needed basis. The consulting fees paid to Mr. Kohler for rendering this
service for the year ended December 31, 1997, totaled $24,000. Currently, the
monthly fee paid for Mr. Kohler's consulting services is $2,000, however, the
Company and Mr. Kohler have agreed that commencing in April, 1998, he will be
paid $125 per hour for consulting services.
At June 30, 1997, the Company had subscription receivables from officers in
the aggregate amount of $18,581. Of such amount, $8,581 is due from Jeffrey R.
Paletz in connection with the purchase of 171,428 shares of Common Stock in 1989
and $10,000 is due from Melvin Graf in connection with the purchase of 200,000
shares in 1989. Messrs. Paletz and Graf have agreed to pay the subscription
receivables before November 10, 1998, plus 6% simple interest accruing from
1989.
It is the Company's policy that it not engage in any material transactions
with officers, directors or beneficial holders of 5% or more of the Company's
Common Stock, or affiliates of such persons, unless the terms of any such
transaction are no less favorable to the Company than those that could be
obtained from unaffiliated third parties and are approved by a majority of the
Company's independent directors who do not have an interest in the transaction
and who have had access, at the Company's expense, to the Company's or
independent legal counsel. Further, the Company will not make loans to officers
and directors, or their affiliates, for the purpose of purchasing securities
from the Company.
6
<PAGE>
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth information as of December 31, 1997,
regarding the beneficial ownership of shares of Common Stock of the Company by
each director and executive officer of the Company, by all directors and
executive officers of the Company as a group, and by each shareholder known by
the Company to own beneficially more than five percent (5%) of the outstanding
shares of the Company's Common Stock.
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENT OF
BENEFICIALLY OUTSTANDING
NAME AND ADDRESS OF BENEFICIAL OWNER OWNED(1) SHARES(2)
- ------------------------------------------------------------------------------ -------------------- ---------------
<S> <C> <C>
Perkins Capital Management, Inc. (3).......................................... 217,500 7.5
730 East Lake Street
Wayzata, MN 55391-1769
DIRECTORS AND EXECUTIVE OFFICERS:
Gary S. Kohler (4)............................................................ 1,032,784 35.4
Jeffrey R. Paletz............................................................. 347,398 11.9
Melvin Graf (5)............................................................... 213,334 7.3
Jack S. Kohler (6)(7)......................................................... 327,500 11.0
Dustin Elder (8).............................................................. 59,240 2.0
Robert A. Hegstrom............................................................ -- --
Michael Wigley................................................................ -- --
All directors and executive officers as a group (7 persons)................... 1,780,256 59.6
</TABLE>
- ------------------------
(1) Each person has sole voting power and sole dispositive power with respect to
all outstanding shares, except as otherwise noted or disclosed by the
beneficial owner in the Schedule 13G filing described at footnote 3 below.
(2) Based on 2,915,006 shares outstanding at December 31, 1997. Such amount does
not include 93,500 shares of common stock issuable upon exercise of stock
options. Each figure showing the percentage of outstanding shares owned
beneficially has been calculated by treating as outstanding and owned the
shares which could be purchased by the indicated person(s) within 60 days
upon the exercise of existing stock options or warrants.
(3) Reflects information included on Schedule 13G dated February 11, 1998 filed
with the Securities and Exchange Commission.
(4) Includes 40,000 shares held by Gary S. Kohler as custodian for the benefit
of his children. Mr. Kohler disclaims beneficial ownership of such shares.
(5) Includes 13,334 shares held by Mr. Graf's spouse. Mr. Graf disclaims
beneficial ownership of such shares.
(6) Includes 200,000 shares currently owned by Gary S. Kohler, who has granted
an option to Jack S. Kohler to acquire such shares.
(7) Includes options to acquire 50,000 shares from the Company.
(8) Includes options to acquire 20,000 shares from the Company.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The Company's directors, executive officers and any persons holding more
than 10% of the outstanding Common Stock of the Company are required to file
with the Securities and Exchange Commission reports concerning their initial
ownership of Common Stock and any subsequent changes in such ownership. The
Company believes that during 1997 the filing requirements were satisfied on a
timely basis
7
<PAGE>
by all such persons. In making this disclosure, the Company has relied solely on
written representations of its directors, officers and beneficial owners of more
than 10% of the Common Stock and copies of the reports they have filed with the
Securities and Exchange Commission and furnished to the Company.
RELATIONSHIP WITH INDEPENDENT ACCOUNTANTS
The Board of Directors has appointed the firm of Schechter Dokken Kanter
Andrews & Selcer, Ltd., independent public accountants, to audit the financial
statements of the Company and its subsidiary for the fiscal year ending December
31, 1998.
A representative of Schechter Dokken Kanter Andrews & Selcer, Ltd. is
expected to be present at the meeting and to be available to respond to
appropriate questions. The representative will also be provided an opportunity
to make a statement, if he or she so desires.
PROPOSALS OF SHAREHOLDERS
Any shareholder wishing to have a proposal considered for inclusion in the
Company's proxy solicitation materials for the Annual Meeting of Shareholders to
be held in 1999 must set forth such proposal in writing and file it with the
Secretary of the Company no later than February 1, 1999.
OTHER BUSINESS
At the date of this Proxy Statement, management knows of no other business
that may properly come before the Annual Meeting. However, if any other matters
properly come before the meeting, the persons named in the enclosed form of
proxy will vote the proxies received in response to this solicitation in
accordance with their best judgment on such matters.
FINANCIAL INFORMATION
The Company's 1997 Annual Report to Shareholders for the year ended December
31, 1997, including consolidated financial statements accompanies this Proxy
Statement. The Annual Report is not to be regarded as proxy soliciting material
or as a communication by means of which any solicitation is to be made.
By Order of the Board of Directors
Melvin Graf,
SECRETARY
April 30, 1998
8
<PAGE>
PROXY
CHOICETEL COMMUNICATIONS, INC.
PROXY SOLICITED BY BOARD OF DIRECTORS
FOR ANNUAL MEETING OF SHAREHOLDERS
MAY 27, 1998
The undersigned, revoking all prior proxies, hereby appoints Jeffrey R.
Paletz and Jack S. Kohler, or either of them, as proxy or proxies, with full
power of substitution and revocation, to vote all shares of Common Stock of
ChoiceTel Communications, Inc. (the "Company") of record in the name of the
undersigned at the close of business on April 17, 1998, at the Annual Meeting of
Shareholders to be held on Wednesday, May 27, 1998, or at any adjournment
thereof, upon the following matters:
1. Election of the following nominees as directors:
Gary S. Kohler, Jeffrey R. Paletz, Melvin Graf,
Robert A. Hegstrom, Michael Wigley
/ / FOR ALL NOMINEES / / WITHHOLD FOR ALL NOMINEES
/ / FOR ALL NOMINEES
EXCEPT THE FOLLOWING:
(Write the name(s) of the nominee(s) withheld in the
space provided below.)
- --------------------------------------------------------------------------------
(CONTINUED ON OTHER SIDE)
<PAGE>
(CONTINUED FROM OTHER SIDE)
2. In their discretion the Proxies are authorized to vote upon such matters as
may properly come before the meeting.
Please mark, date, sign, and mail this proxy promptly in the enclosed
envelope.
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 PROPOSAL 1. THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR PROPOSAL
1.
DATED: _____________________, 1998
__________________________________
__________________________________
__________________________________
Signature(s)
Please sign your name exactly as
it appears below. In the case of
shares owned in joint tenancy or
as tenants in common, all should
sign. Fiduciaries should indicate
their title and authority.
