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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
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 (S) 240.14a-11(c) or (S) 240.14a-12
CYPRESS COMMUNICATIONS
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
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:
-------------------------------------------------------------------------
(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:
-------------------------------------------------------------------------
(4) Date Filed:
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Notes:
Reg. (S) 240.14a-101.
SEC 1913 (3-99)
<PAGE>
CYPRESS COMMUNICATIONS, INC.
Fifteen Piedmont Center, Suite 100
Atlanta, Georgia 30305
July 19, 2000
Dear Stockholder:
You are cordially invited to attend the first annual meeting of
stockholders of Cypress Communications, Inc. The meeting will be held on
Tuesday, August 15, 2000 at 8:30 a.m., local time, at the Auditorium at Fourteen
Piedmont Center, Atlanta, Georgia.
The attached proxy statement, with formal notice of the meeting on the
first page, describes the matters expected to be acted upon at the meeting. We
urge you to review these materials carefully and to use this opportunity to take
part in the company's affairs by voting on the matters described in this proxy
statement. We hope that you will be able to attend the meeting.
Your vote is important. Whether you plan to attend the meeting or not,
please complete the enclosed proxy card and return it as promptly as possible or
vote by calling the toll-free telephone number or via the Internet. The
enclosed proxy card contains instructions regarding all three methods of voting.
If you attend the meeting, you may continue to have your shares voted as
instructed in the proxy or you may withdraw your proxy at the meeting and vote
your shares in person.
We look forward to seeing you at the meeting.
Sincerely,
/s/ W. Frank Blount
----------------------------
W. Frank Blount
Chairman and Chief Executive
Officer
<PAGE>
CYPRESS COMMUNICATIONS, INC.
Fifteen Piedmont Center, Suite 100
Atlanta, Georgia 30305
___________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON AUGUST 15, 2000
___________________
The 2000 annual meeting of stockholders of Cypress Communications, Inc.
will be held on Tuesday, August 15, 2000 at 8:30 a.m., local time, at the
Auditorium at Fourteen Piedmont Center, Atlanta, Georgia. At the meeting,
stockholders will vote upon the following proposals:
1. To elect three Class I directors to serve until the 2003 annual meeting
of stockholders.
2. To consider and act upon any other matters that may properly be brought
before the annual meeting and at any adjournments or postponements thereof.
You may vote if you are a stockholder of record as of the close of business
on June 23, 2000. If you do not plan to attend the meeting and vote your shares
of common stock in person, please vote in one of the following ways:
. Use the toll-free telephone number shown on the proxy card;
. Go to the website address shown on the proxy card and vote over the
Internet; or
. Mark, sign, date and promptly return the enclosed proxy card in the
postage-paid envelope.
Any proxy may be revoked at any time prior to its exercise at the annual
meeting.
By Order of the Board of Directors
/s/ Mark A. Graves
-----------------------------------
Mark A. Graves
Secretary
July 19, 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
PROXY STATEMENT........................................................................... 1
QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING............................................ 1
What is the purpose of the annual meeting?......................................... 1
Who is entitled to vote?........................................................... 1
Who can attend the meeting?........................................................ 1
How many shares must be represented at the meeting in order to hold the meeting?... 1
How do I vote?..................................................................... 2
Will other matters be voted on at the annual meeting?.............................. 2
Can I revoke my proxy instructions?................................................ 2
What other information should I review before voting?.............................. 2
PROPOSAL 1: ELECTION OF DIRECTORS......................................................... 3
Introduction....................................................................... 3
Vote Required...................................................................... 3
Recommendation..................................................................... 3
Information Regarding Nominees, Other Directors and Executive Officers............. 3
Board of Directors and Committees.................................................. 8
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS.......................................... 8
Director Compensation.............................................................. 8
Executive Compensation............................................................. 9
Summary Compensation Table......................................................... 9
Option Grants in Fiscal Year 1999.................................................. 10
Fiscal Year-End Option Values...................................................... 11
Compensation Committee Interlocks and Inside Participation......................... 11
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION................................... 12
General............................................................................ 12
Executive Compensation Program..................................................... 12
Compensation of Chief Executive Officer............................................ 13
Tax Deductibility of Compensation.................................................. 13
STOCK PERFORMANCE GRAPH................................................................... 14
PRINCIPAL AND MANAGEMENT STOCKHOLDERS..................................................... 14
Beneficial Ownership Table......................................................... 15
Section 16(a) Beneficial Ownership Reporting Compliance............................ 16
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS............................................ 17
OTHER MATTERS............................................................................. 18
Independent Public Accountants..................................................... 18
Expenses of Solicitation........................................................... 18
Stockholder Proposals.............................................................. 18
General............................................................................ 18
</TABLE>
i
<PAGE>
July 19, 2000
CYPRESS COMMUNICATIONS, INC.
Fifteen Piedmont Center, Suite 100
Atlanta, Georgia 30305
___________________
PROXY STATEMENT
___________________
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Cypress Communications, Inc. for use at the
2000 annual meeting of stockholders to be held on Tuesday, August 15, 2000 at
8:30 a.m., local time, at the Auditorium at Fourteen Piedmont Center, Atlanta,
Georgia, and at any adjournments or postponements of the annual meeting.
QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING
What is the purpose of the annual meeting?
At the annual meeting, stockholders will act upon the matters set forth in
the accompanying notice of meeting, including the election of three directors
and any other matters that may properly come before the meeting.
Who is entitled to vote?
All stockholders of record of Cypress Communications' common stock at the
close of business on June 23, 2000, which is referred to as the record date, are
entitled to receive notice of the annual meeting and to vote the shares of
common stock held by them on the record date. Each outstanding share of common
stock entitles its holder to cast one vote for each matter to be voted upon.
Who can attend the meeting?
All stockholders of record of Cypress Communications' common stock at the
close of business on the record date, or their designated proxies, are
authorized to attend the annual meeting.
How many shares must be represented at the meeting in order to hold the meeting?
The presence, in person or by proxy, of holders of at least a majority of
the total number of outstanding shares of common stock entitled to vote is
necessary to constitute a quorum for the transaction of business at the annual
meeting. As of the record date, there were 47,953,841 shares of common stock
outstanding and entitled to vote at the annual meeting. Shares that reflect
abstentions or "broker non-votes," if any, will be counted for purposes of
determining whether a quorum is present for the transaction of business at the
annual meeting. "Broker non-votes" are proxies received from brokers or other
nominees holding shares on behalf of their clients who have not been given
specific voting instructions from their clients with respect to non-routine
matters. Under the rules of certain self regulatory organizations, brokers and
other nominees do not have discretionary voting power to vote
<PAGE>
such shares on non-routine matters without specific voting instructions from the
beneficial owners of the shares.
How do I vote?
If your shares of common stock are held by a broker, bank or other nominee
(i.e., in "street name"), you will receive instructions from your nominee which
you must follow in order to have your shares voted.
If you hold your shares of common stock in your own name as a holder of
record, you may vote in person at the annual meeting or instruct the proxy
holders named in the enclosed proxy card how to vote your shares by:
. using the toll-free telephone number shown on the proxy card;
. going to the website address shown on the proxy card and voting over the
Internet; or
. marking, signing, dating and returning the proxy card in the postage-
paid envelope that we have provided to you. Please note that if you vote
by telephone or over the Internet, you do not need to return your proxy
card.
Will other matters be voted on at the annual meeting?
We are not aware of any other matters to be presented at the annual meeting
other than those described in this proxy statement. If any other matters not
described in the proxy statement are properly presented at the meeting, proxies
will be voted in accordance with the best judgment of the proxy holders.
Can I revoke my proxy instructions?
You may revoke your proxy at any time before it has been exercised by:
. filing a written revocation with the Secretary of Cypress Communications
at the address set forth below;
. filing a duly executed proxy bearing a later date; or
. appearing in person and voting by ballot at the annual meeting.
Any stockholder of record as of the record date attending the annual
meeting may vote in person whether or not a proxy has been previously given, but
the presence (without further action) of a stockholder at the annual meeting
will not constitute revocation of a previously given proxy.
What other information should I review before voting?
Our 1999 annual report, including financial statements for the fiscal year
ended December 31, 1999, is being mailed to stockholders concurrently with this
proxy statement. The annual report, however, is not part of the proxy
solicitation material. A copy of our annual report filed with the Securities
and Exchange Commission (the "SEC") on Form 10-K, including the financial
statements and the financial statement schedules, may be obtained without charge
by:
2
<PAGE>
. writing to the Secretary of Cypress Communications at the following
address: Fifteen Piedmont Center, Suite 100, Atlanta, Georgia 30305;
. accessing the EDGAR database at the SEC's website at www.sec.gov; or
. contacting the SEC by telephone at (800) SEC-0330.
PROPOSAL 1: ELECTION OF DIRECTORS
Introduction
The Board of Directors currently consists of nine members who are divided
into three classes. At the annual meeting, three Class I directors will be
elected to serve until the 2003 annual meeting and until their successors are
duly elected and qualified.
The Board of Directors has nominated Ward C. Bourdeaux, Jr., William P.
Egan and Jeffrey H. Schutz to serve as the Class I directors. All of the
nominees are currently serving as directors of Cypress Communications. The
Board of Directors anticipates that the nominees will continue to serve, if
elected, as directors. However, if any of the nominees should be unable to
accept election, the proxies will be voted for the election of such other person
or persons as the Board of Directors may recommend. The Board of Directors will
consider a nominee for election to the Board of Directors recommended by a
stockholder of record if the stockholder submits the nomination in compliance
with the requirements of our bylaws. See "Other Matters - Stockholder Proposals"
for a summary of these requirements.
Vote Required
Directors must be elected by a plurality of the votes cast at the annual
meeting. This means that the three nominees receiving the highest number of
"yes votes" will be elected as directors. Votes may be cast FOR or WITHHELD
FROM each nominee. Votes cast FOR the nominees will count as "yes votes"; votes
that are WITHHELD FROM the nominees will be excluded entirely from the vote and
will have no effect.
Furthermore, if you hold your shares of common stock in your own name as a
holder of record, and you fail to vote your shares, either in person or by
proxy, the votes represented by your shares will be excluded entirely from the
vote and will have no effect. If, however, your shares are held by a broker,
bank or other nominee (i.e., in "street name") and you fail to give instructions
as to how you want your shares voted, the broker, bank or other nominee may vote
the shares in their own discretion.
Recommendation
The Board of Directors unanimously recommends a vote FOR the nominees.
Information Regarding Nominees, Other Directors and Executive Officers
The following biographical descriptions set forth certain information with
respect to the three nominees for re-election as directors at the annual
meeting, the incumbent directors who are not up for election at this annual
meeting and the executive officers and other key employees who are not
directors. This information has been furnished by the respective individuals.
The following information is as of June 1, 2000:
3
<PAGE>
Nominees for Election as Directors - Term Expiring 2003
Ward C. Bourdeaux, Jr. is a co-founder of Cypress Communications and has
served as our Executive Vice President and a director since August 1995. From
January 1993 to April 1995, Mr. Bourdeaux served as Director of Development for
RealCom Office Communications, where he was responsible for identifying new
building and market opportunities and entering into new license agreements on a
national basis, and for the renewal of existing agreements nationally. Prior to
that, he spent over nine years in the commercial real estate industry with
Cushman & Wakefield and Carter & Associates. Mr. Bourdeaux received a Bachelor
of Arts degree in Communications from the University of Alabama. He is 41 years
old.
William P. Egan has served as a director since February 1997 and a member
of the Compensation Committee of the Board of Directors since November 1999.
Mr. Egan is a founding partner of Burr, Egan, Deleage & Co. and Alta
Communications, an affiliated firm. For over twenty years, Mr. Egan has
invested in a wide variety of companies in the information technology, life
sciences and communications industries. He is a past President and Chairman of
the National Venture Capital Association. Mr. Egan received a Bachelor of Arts
degree from Fairfield University and a Master of Business Administration degree
from the University of Pennsylvania. He serves as a director of Cephalon, Inc.
He is 54 years old.
Jeffrey H. Schutz has served as a director since November 1996 and as a
member of the Compensation Committee of the Board of Directors since November
1999. Mr. Schutz is a general partner of Centennial Ventures, a venture capital
firm based in Denver, Colorado that focuses on electronic communications
companies. Since 1981, Centennial has invested more than $700 million in
pioneering entrepreneurial ventures in communications networks, services and
technologies. Mr. Schutz received an AB in Economics from Middlebury College
and a Master of Business Administration degree from the Colgate Darden Graduate
School of Business Administration at the University of Virginia. Mr. Schutz is
a director of Umongo, Inc. and Evolution Networks, Inc. He is 48 years old.
Incumbent Directors - Term Expiring 2001
Laurence S. Grafstein has served as a director and a member of the Audit
Committee of the Board of Directors since November 1999. Mr. Grafstein is
Managing Director and co-founder of Gramercy Communications Partners, Inc., a
private equity firm specializing in telecommunications investments. From
February 1996 to May 1999, Mr. Grafstein was a Managing Director and head of the
global telecommunications investment banking practice at Credit Suisse First
Boston, a global investment bank. From February 1994 to February 1996, Mr.
Grafstein was a Managing Director of Wasserstein Perella & Co., a global
investment bank. Mr. Grafstein received a Bachelor of Arts degree from Harvard
University, a Master of Philosophy degree from Balliol College of Oxford
University, where he was a Rhodes Scholar and president of the Oxford Union
Society, and an LLB from the University of Toronto Law School. Mr. Grafstein is
a director of Z-Tel Technologies, Inc. He is 39 years old.
Randall A. Hack has served as a director and a member of the Audit
Committee of the Board of Directors since November 1999. He is a Senior
Managing Director of Nassau Capital. From 1990 to 1994, Mr. Hack served as
President and Chief Executive Officer of the Princeton University Investment
Company, where he had overall management responsibility for Princeton's multi
billion-dollar endowment of publicly traded securities and private investments.
From 1979 to 1988, he was President and Chief Executive Officer of Matrix
Development Group, a commercial and industrial real estate
4
<PAGE>
development firm, which he founded. Mr. Hack received a Bachelor of Arts degree
from Princeton University and a Master of Business Administration degree from
Harvard University. He serves as a director of SWWT, Inc., Cornerstone
Properties, Inc. and Crown Castle International Corp. He is 52 years old.
P. Eric Yopes has served as a director since December 1999. Mr. Yopes is
the Vice Chairman-Investments of Shorenstein Management, Inc. Mr. Yopes joined
Shorenstein in 1984 and his responsibilities have encompassed all aspects of
real estate investment, development, acquisitions/sales, finance, operations and
leasing. He has served as Senior Operating Executive and Chief Financial
Officer of Shorenstein. His current responsibilities include telecommunications
and technology strategy and investment management. Mr. Yopes received a
Bachelor of Arts degree from Yale University and a Juris Doctor degree from the
University of Chicago. He is 48 years old.
Incumbent Directors - Term Expiring 2002
R. Stanley Allen is a co-founder and a director of Cypress Communication
and was recently named Vice Chairman, after serving as our Chief Executive
Officer since August 1995. From August 1995 until September 1998, he also
served as our President. From March 1994 to May 1996, Mr. Allen was President
and Chief Executive Officer of Applied Video Technologies, Inc., a wireless
cable and communications investment and development company. From 1991 to 1994,
Mr. Allen was President of American Quality Cable Corporation, a wireless cable
television operator. Mr. Allen has also held positions as Manager-Real Estate
Consulting for Coopers & Lybrand and Analyst for Wellington Real Estate, an
affiliate of Boston-based Wellington Management Company. Mr. Allen was a
Director for Wireless Cable of Atlanta before its acquisition by BellSouth in
1997 and was also a Director for the Wireless Cable Association. Mr. Allen
received a Bachelor of Arts degree in Economics and a Master of Business
Administration degree from the University of Virginia. He is 42 years old.
W. Frank Blount was named our new Chairman and Chief Executive Officer in
June 2000. From January 1992 until March 1999, Mr. Blount served as Chief
Executive Officer of Telstra Communications Corporation, Australia's principal
telecommunications company. Prior to joining Telstra, he served in various
executive positions for AT&T, including Group President of the Communications
Products Group and President of the Network Operations Group. Mr. Blount
currently serves as a director of Hanson's UK, Alcatel USA and Alcatel France,
Entergy Corporation, Adtran, Inc. and Caterpillar, Inc. Mr. Blount received a
Bachelor of Science degree from the Georgia Institute of Technology, a Master of
Business Administration degree from Georgia State University and a Master of
Science in Management degree from the Massachusetts Institute of Technology, as
a Sloan Fellow. He is 61 years old.
John C. Halsted has served as a director since October 1998 and as a member
of the Compensation Committee and Audit Committee of the Board of Directors
since November 1999. Mr. Halsted serves as Senior Vice President of Beacon
Capital Partners, Inc. and Chief Investment Officer of Beacon Venture Partners,
Beacon Capital's venture capital subsidiary. From 1993 to 1997, Mr. Halsted was
Vice President at Harvard Private Capital Group. From 1991 to 1993, Mr. Halsted
was an Associate with Simmons & Company, an investment banking firm in Houston,
Texas. Mr. Halsted received a Master of Business Administration degree from The
Harvard Business School and a Bachelor of Arts degree in Economics from The
University of California at Berkeley. He is 35 years old.
5
<PAGE>
Executive Officers and Key Employees Who Are Not Directors
Mark A. Graves has served as our Chief Operating Officer and Secretary
since September 1997. From September 1998 until June 2000, he also served as
our President, and from September 1997 until September 1998, he also served as
our Chief Financial Officer. From March 1994 to September 1997, Mr. Graves was
Executive Director of Corporate Development for BellSouth Corporation, where he
was involved in mergers, acquisitions and other strategic transactions. Mr.
Graves' activities principally involved BellSouth Corporation's telephone
services, Internet services unit and wireless data partnerships. From May 1989
to February 1994, Mr. Graves was a Principal at Sterling Payot Company, a
private investment firm in San Francisco, where he provided advisory services in
strategy and finance predominantly to media and telecommunications companies,
including Pacific Telesis in its spin-off of PacTel Corp., which was renamed
AirTouch Communications. Prior to joining Sterling Payot Company, Mr. Graves
held positions at The First Boston Corporation and United Technologies
Corporation. Mr. Graves received a Bachelor of Arts degree in Economics and a
Master of Business Administration degree from Harvard University. He is 40
years old.
Barry L. Boniface has served as our Chief Financial Officer since October
1998. From September 1994 to October 1998, Mr. Boniface was Executive Director
of Corporate Development for BellSouth Corporation, where he was responsible for
domestic and international mergers, acquisitions, divestitures and other
strategic transactions. Mr. Boniface's activities principally involved
BellSouth's domestic and international wireless telephone services and
competitive local telephone activities. Prior to that, Mr. Boniface was a
principal in Berkshire Partners, Inc., a merchant banking firm based in Dallas,
Texas. He has also held the positions of Chief Operating Officer for Global
Business Acceleration, Inc., an early stage software development company, and
Vice President in the Corporate Finance Department at Principal Financial
Securities, Inc., an investment banking firm. Mr. Boniface received a Bachelor
of Business Administration degree in Management Information Systems from
Southern Methodist University and a Master of Business Administration degree
from the Goizueta Business School at Emory University. He is 38 years old.
C. Timothy Allaway has served as our Vice President of Customer Service
since December 1999. From June 1996 to December 1999, Mr. Allaway was Director,
Customer Services for IBM, North America supporting the full line of hardware
and software offerings. From September 1994 to June 1996, Mr. Allaway was
Director, Small Business Sales and Partnerships for MCI. From 1986 to September
1994, Mr. Allaway held various sales and service management positions for MCI.
Prior to that, Mr. Allaway spent five years with Xerox Corporation. Mr. Allaway
received a Bachelor of Science degree in Management from Jacksonville State
University and a Master of Business Administration degree from Auburn
University. He is 41 years old.
Eugene H. Kreeft has served as our Vice President of Engineering since
February 1999. From 1991 until February 1999, Mr. Kreeft was an Executive Vice
President of Preferred Networks Inc., an outsourcing services provider to the
wireless industry which he founded in 1991. From 1989 to 1991, Mr. Kreeft
served as Director of Technical Support, U.S. Operations, for Glenayre
Technologies, a developer and provider of personal telecommunications systems.
Prior to that, Mr. Kreeft was employed by BBL Industries, Inc., a paging
equipment manufacturer, where he served as both Vice President of Engineering
and Manufacturing and Vice President of Applications/New Product Development.
Mr. Kreeft has also held management and engineering positions with Motorola, RAM
Broadcasting, AT&T, Western Union Microwave Systems, Highland Telephone Company
and Delaware Telephone Company. He is 50 years old.
6
<PAGE>
Robert W. McCarthy has served as our Vice President, General Counsel and
Assistant Secretary since December 1999. From August 1996 until December 1999,
Mr. McCarthy was a General Attorney at BellSouth Corporation, where he
specialized in domestic and international mergers and acquisitions and joint
venture transactions. Prior to that, he was a partner in the Atlanta offices of
Hunton & Williams, where he specialized in mergers and acquisitions, joint
ventures and venture capital transactions. Mr. McCarthy received a Bachelor of
Arts degree in Political Science and a Juris Doctor degree from the University
of North Carolina at Chapel Hill. He is 38 years old.
James W. McClintock has served as our Vice President of International since
December 1999. From March 1999 until December 1999, Mr. McClintock was Vice
President of Data Services for BellSouth International (BSI), where he led the
development of BSI's Internet and data strategy and associated business
development activities, focusing principally on Latin America and Europe. Prior
to that, Mr. McClintock was Executive Director of Corporate Development for
BellSouth Corporation, where he worked primarily with BellSouth Entertainment
and BellSouth.net, managing a number of significant merger, acquisition and
alliance activities involving these two business units. Prior to joining
BellSouth in 1993, Mr. McClintock had fourteen years of experience managing,
investing in and financing entrepreneurial ventures of all types and scale,
including positions in banking with Citicorp and in venture capital with Equity
Group Investments. Mr. McClintock received a Bachelor of Arts degree in
Economics from Washington and Lee University and a Master of Business
Administration degree in Finance from the University of North Carolina. He is
44 years old.
Raymond F. Potts has served as our Vice President of Marketing and Sales
since October 1999. From September 1997 to October 1999, Mr. Potts was Regional
Vice President for Sales, Operations and Marketing for the midwest territory of
Teligent, Inc., a wireless telecommunications company. From 1996 to September
1997, Mr. Potts served as Vice President of Sales for the midwest region of
Cable & Wireless, Inc., a wireless telecommunications company. Prior to that,
Mr. Potts spent in excess of ten years in various senior-level sales and service
management positions for Midcom Communications, Sprint, LCI and TFN
Communications. Mr. Potts received a Bachelor of Business Administration degree
from St. Joseph's College in Rensselaer, Indiana. He is 36 years old.
Claire S. Schenk has served as our Vice President of Human Resources since
November 1999. From June 1999 until November 1999, she also served as our
Director of Human Resources. From June 1996 until May 1999, Ms. Schenk was Vice
President for Human Resources for Trism, Inc., a national specialized
transportation company headquartered in Atlanta. From December 1989 until June
1996, Ms. Schenk was Vice President, Senior Business Partner for two national
mortgage companies. Ms. Schenk also has ten years of human resources management
experience with Sheraton Corporation and Six Flags Corporation. Ms. Schenk
received a Bachelor of Arts degree in Psychology from Emory University. She is
50 years old.
Alistair Sloan has served as our Vice President of Internet Services since
September 1999. From January 1998 until September 1999, Mr. Sloan was our
Manager of Internet Services. Prior to joining Cypress, Mr. Sloan was Project
Manager at Systems Atlanta, where he consulted with clients on Internet and Wide
Area Networking design and security. Prior to that, Mr. Sloan was a manager of
Internet Connect, a division of Systems Atlanta specializing in dedicated
business Internet connectivity. Mr. Sloan has also held positions with Ingram
Micro, Inc. and has been an independent consultant in the field of local area
networking. Mr. Sloan received a Bachelor of Arts degree in Political Science
from the University of Bridgeport. He is 35 years old.
7
<PAGE>
Board of Directors and Committees
Cypress Communications is managed by a nine member board of directors, six
of whom are independent of management. The Board of Directors is divided into
three classes, and the members of each class of directors serve for staggered
three-year terms. The Board is composed of three Class I Directors (Messrs.
Bourdeaux, Egan and Schutz), three Class II Directors (Messrs. Grafstein, Hack
and Yopes) and three Class III Directors (Messrs. Allen, Blount and Halsted).
The terms of the Class II and Class III directors will expire upon the election
and qualification of directors at the annual meetings of stockholders held in
2001 and 2002, respectively. At each annual meeting of stockholders, directors
will be re-elected or elected for a full term of three years to succeed those
directors whose terms are expiring.
The Board of Directors met eight times in 1999. Each director attended at
least 75% of the aggregate of (1) the total number of meetings of the Board of
Directors (held during the period for which he has been a director) and (2) the
total number of meetings of all committees of the Board of Directors on which
the director served (during the periods that he served).
Audit Committee. The Board of Directors established an Audit Committee
currently consisting of Messrs. Hack, Halsted and Grafstein. The Audit
Committee is responsible for making recommendations to the Board of Directors
concerning the engagement of independent public accountants, reviewing the scope
and results of the audit engagement with the independent public accountants,
reviewing the independence of the independent public accountants, considering
the range of audit and non-audit fees and reviewing the adequacy of our internal
accounting controls. The Audit Committee was established by the Board of
Directors in November. The Audit Committee did not meet prior to the end of the
year.
Compensation Committee. The Board of Directors also established a
Compensation Committee currently consisting of Messrs. Egan, Halsted and
Schutz. The Compensation Committee exercises all powers of the Board of
Directors in connection with the compensation of executive officers, including
incentive compensation and benefit plans. The Compensation Committee also has
authority to grant awards under the 2000 Stock Option and Incentive Plan. The
Compensation Committee was established by the Board of Directors in November.
The Compensation Committee did not meet prior to the end of the year.
Cypress Communications does not have a standing nominating committee. The
full Board of Directors performs the function of such a committee.
The Board of Directors may establish, from time to time, other committees
to facilitate the management of our business.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
Director Compensation
Directors of Cypress Communications who are also employees receive no
additional compensation for their services as directors. Non-employee directors
are compensated as follows: $5,000 annual fee, $1,000 for each board meeting
attended in person and $500 for each committee meeting and for each board
meeting attended by telephone. Non-employee directors are also eligible to
participate in our 2000 Stock Option and Incentive Plan at the discretion of the
full Board of Directors.
8
<PAGE>
Executive Compensation
Summary Compensation Table. The following table sets forth in summary form
the compensation paid to our Chief Executive Officer and the other most highly
compensated executive officers whose total salary and bonus exceeded $100,000
during the fiscal year ended December 31, 1999.
Summary Compensation Table
<TABLE>
<CAPTION>
Annual Long-term
Compensation Compensation
--------------------------------- --------------------
Securities
Underlying
Name and Principal Position Salary Bonus Options
------------------------------------------------------------------ --------------- ----------- --------------------
<S> <C> <C> <C>
R. Stanley Allen ................................................ $165,000 $ 88,500 243,000
Chief Executive Officer
Mark A. Graves .................................................. 155,000 82,969 306,000
President, Chief Operating Officer and Secretary
Ward C. Bourdeaux, Jr. ......................................... 135,000 195,954 369,000
Executive Vice President
Barry L. Boniface .............................................. 145,000 105,000 297,000
Vice President, Chief Financial Officer and Treasurer
</TABLE>
9
<PAGE>
Option Grants. The following table sets forth information with respect to
stock options granted to our named executive officers during the fiscal year
ended December 31, 1999.
Option Grants in Fiscal Year 1999(1)
<TABLE>
<CAPTION>
Individual Grants
----------------------------------------------------------
Percent of
Number of Total Potential Realizable
Securities Options Value at Assumed
underlying Granted to Exercise Annual Rates of Stock
Options Employees Price Price Appreciation For
Grant in Fiscal Per Expiration Option Terms(2)
----------------------------
Name (#) Year(%) Share Date 5% 10%
-------------------- ------------ ---------- --------- ----------- ---------- -------------
<S> <C> <C> <C> <C> <C> <C>
R. Stanley Allen......... 180,000 5.14% $1.07 04/07/09 $ 983,136 $1,679,563
63,000 1.80 2.53 11/29/09 1,379,915 2,291,697
Mark A. Graves........... 180,000 5.14 1.07 04/07/09 983,136 1,679,563
126,000 3.60 2.53 11/29/09 2,759,831 4,583,393
Ward C. Bourdeaux, Jr.... 180,000 5.14 1.07 04/07/09 983,136 1,679,563
189,000 5.40 2.53 11/29/09 4,139,746 6,875,090
Barry L. Boniface........ 45,000 1.29 1.07 04/07/09 245,784 419,891
252,000 7.20 2.53 11/29/09 5,519,662 9,166,786
</TABLE>
_____________
(1) The number of options granted in the fiscal year ended December 31, 1999
was 3,526,655. The options expire ten years after the date of the grant
and vest 20% upon the first anniversary of the date of grant and 5% each
subsequent quarter measured from the first anniversary of the date of
grant. The options fully vest upon a change of control.
(2) Potential realizable value is based on the assumption that our common stock
appreciates at the annual rate shown, compounded annually, from the date of
grant until expiration of the ten-year term. These numbers are calculated
based on SEC requirements and do not reflect our projection or estimate of
future stock price growth. Potential realizable values are computed by
multiplying the number of shares of common stock subject to a given option
by the fair market value of the common stock on the date of grant,
determined to be $4.01 as of April 7, 1999 and $15.00 as of November 29,
1999, and assuming that the aggregate stock value derived from that
calculation compounds at the annual 5% or 10% rate shown in the table for
the entire ten-year term of the option and subtracting from that result the
aggregate option exercise price. Actual realizable value, if any, will be
dependent on the future price of the common stock on the actual date of
exercise, which may be earlier than the stated expiration date.
10
<PAGE>
Option Exercises and Year-End Option Values. None of the named executive
officers exercised any of their stock options during the fiscal year ended
December 31, 1999. The following table sets forth the number of shares covered
by both exercisable and unexercisable options as of December 31, 1999 and the
year-end value of exercisable and unexercisable options as of December 31, 1999
for the named executive officers.
Fiscal Year-End Option Values
<TABLE>
<CAPTION>
Number of Securities Underlying Unexercised Value of Unexercised In-the-Money Options at
Options at December 31, 1999 December 31, 1999(1)
----------------------------------------------- -----------------------------------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
------------------------- -------------------- ----------------------- ------------------------ -------------------------
<S> <C> <C> <C> <C>
R. Stanley Allen........... 248,452 491,663 $4,058,045 $7,840,900
Mark A. Graves............. 214,702 588,413 3,502,295 9,290,050
Ward C. Bourdeaux, Jr...... 248,452 617,663 4,058,045 9,663,700
Barry L. Boniface.......... 51,075 501,300 813,795 7,617,780
</TABLE>
_____________
(1) The value of the unexercised in-the-money options at December 31, 1999 was
calculated using an initial public offering price of $17.00 per share as
the estimated fair value per common share at that date.
Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee are Messrs. Egan, Halsted and
Schutz. Mr. Egan is a general partner of Alta Communications, which purchased
263,158 shares of Series C preferred stock from Cypress Communications on
October 8, 1999 for $5.0 million. These shares were automatically converted
into 1,184,210 shares of common stock in connection with our initial public
offering in February 2000. Mr. Halsted is an executive officer of Beacon
Capital Partners, which purchased 342,105 shares of Series C preferred stock
from Cypress Communications on October 8, 1999 for $6.5 million. These shares
were automatically converted into 1,539,473 shares of common stock in connection
with our initial public offering. Mr. Schutz is a general partner of Centennial
Ventures, which purchased 263,158 shares of Series C preferred stock from
Cypress Communications on October 8, 1999 for $5.0 million. These shares were
automatically converted into 1,184,210 shares of common stock in connection with
our initial public offering.
11
<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
General
The Compensation Committee was formed in November 1999 and currently
consists of Messrs. Egan, Halsted and Schutz, none of whom are employees of
Cypress Communications. The Compensation Committee establishes salaries,
incentives and other forms of compensation for executive officers and other
senior level employees and administers the company's incentive compensation and
benefit plans, including the 1997 Stock Option Plan, the 2000 Stock Option and
Incentive Plan and the Employee Stock Purchase Plan.
Executive Compensation Program
Compensation packages generally include base salary, performance-based
bonuses and stock options. The salary and bonus components of the compensation
of our executive officers are designed to work together to fulfill certain
compensation objectives, including:
. attracting and retaining well qualified executive officers who will
enhance the performance of Cypress Communications;
. rewarding management for the attainment of short and long-term
objectives;
. aligning the interests of management with those of the stockholders; and
. relating executive compensation to Cypress Communications' financial
performance and the achievement of corporate goals.
Base Salaries
Base salaries for executive officers were determined by reviewing previous
base salary levels, base salaries paid by comparable companies to executives
with similar responsibilities, individual performances and the overall
performance of Cypress Communications. In establishing current base salaries,
no specific weight was given to any of these factors because each of these
factors was considered significant and the relevance of each factor varies
depending on an officer's responsibilities.
Performance-Based Bonuses
The Compensation Committee believes that performance-based incentives that
align the goals of individual executives with those of Cypress Communications
and its stockholders are of key importance. Accordingly, a material portion of
each executive officer's compensation is tied to a bonus compensation program
that is related to the overall performance of Cypress Communications.
In reviewing the incentive compensation of executive officers for 1999, the
Compensation Committee took into consideration a number of achievements,
including Cypress Communications' performance against the budget and business
plan previously reviewed and approved by the Board of Directors and the
company's entry into a significant number of master license agreements with
property owners and operators throughout the country.
12
<PAGE>
Stock Option Grants
Each executive officer is also the holder of options that vest over time.
These options are intended to increase executive officers' equity interests in
Cypress Communications, providing the executives with the opportunity to share
in the future value they are responsible for creating, as well as to directly
align the interests of the executive officers with those of the stockholders.
The Compensation Committee also believes that the vesting aspect of these
options promotes the retention of key executive officers.
Compensation of Chief Executive Officer
In determining the compensation of the Chief Executive Officer for 1999,
the Compensation Committee applied the same philosophy and procedures as were
applied to the other executive officers. In this regard, the compensation for
Mr. Allen was determined based on a number of factors, including comparative
salaries of chief executive officers of companies in Cypress Communications'
peer group, Mr. Allen's individual performance and the overall performance of
Cypress Communications as measured against stated objectives. The 1999
compensation of Mr. Allen consisted of salary, bonus and stock option grants.
In establishing the 1999 bonus and stock option grants for Mr. Allen, the
Compensation Committee considered his oversight of operating performance, his
oversight of financial performance and his success in meeting key strategic
goals. Mr. Allen's stock option grants, which vest over a five-year period,
were also made to align the interests of Mr. Allen with those of the
stockholders and to provide incentive to build the company and to increase
stockholder value.
Tax Deductibility of Compensation
Section 162(m) of the Internal Revenue Code of 1986, as amended, limits the
deductibility on Cypress Communications' tax return of compensation of over $1
million to any of the named executive officers unless, in general, the
compensation is paid pursuant to a plan which is performance-related, non-
discretionary and has been approved by Cypress Communications' stockholders.
The Compensation Committee's policy with respect to Section 162(m) is to make
every reasonable effort to ensure that compensation is fully deductible for
federal income tax purposes. However, the Compensation Committee may, from time
to time, award compensation that may not constitute "performance-related"
compensation if it believes that such awards would be in the best interests of
the company. Cypress Communications did not pay any compensation during 1999
that would be subject to Section 162(m).
Submitted by the Compensation Committee:
William P. Egan
John C. Halsted
Jeffrey H. Schutz
13
<PAGE>
STOCK PERFORMANCE GRAPH
Cypress Communications completed its initial public offering on February
15, 2000. Accordingly, there was no public trading market for its common stock
as of December 31, 1999.
PRINCIPAL AND MANAGEMENT STOCKHOLDERS
The following table sets forth information regarding beneficial ownership
of our common stock as of June 2, 2000. The percentage of beneficial ownership
is based on 47,953,841 shares of our common stock outstanding as of such date.
The table sets forth such information with respect to:
. each stockholder who is known by us to beneficially own 5% or more of
the common stock;
. each of our directors;
. each of our executive officers named in the Summary Compensation Table;
and
. all of our executive officers and directors as a group.
Unless otherwise indicated, each of the stockholders has sole voting and
investment power with respect to the shares of common stock beneficially owned
by such stockholder.
The number of shares beneficially owned by each stockholder is determined
under rules issued by the SEC. The information is not necessarily indicative of
beneficial ownership for any other purpose. Under these rules, beneficial
ownership includes any shares as to which the individual or entity has sole or
shared voting power or investment power and any shares as to which the
individual or entity has the right to acquire beneficial ownership within 60
days after June 2, 2000, through the exercise of any stock option or other
right.
14
<PAGE>
Beneficial Ownership Table
<TABLE>
<CAPTION>
Name of Beneficial Owner(1) Number of Shares Percent Beneficially
Beneficially Owed Owned
------------------------------------------------------- --------------------------- --------------------------
<S> <C> <C>
Centennial Holdings V, L.P.(2)......................... 8,240,153 17.2
Alta Communications, Inc.(3)........................... 6,118,697 12.8
Beacon Capital Partners, Inc.(4)....................... 4,351,972 9.1
Nassau Capital L.L.C.(5)............................... 2,960,525 6.2
Gramercy Communications Partners, Inc.(6).............. 2,960,526 6.2
W. Frank Blount(7)..................................... 500,000 1.0
R. Stanley Allen(8).................................... 1,070,096 2.2
Ward C. Bourdeaux, Jr.(9).............................. 787,438 1.6
Jeffrey H. Schutz(2)................................... 8,240,153 17.2
William P. Egan(3)..................................... 6,188,697 12.8
John C. Halsted(4)..................................... 4,351,972 9.1
Randall A. Hack(5)..................................... 2,960,525 6.2
Laurence S. Grafstein(6)............................... 2,960,526 6.2
P. Eric Yopes(10)...................................... 828,947 1.7
Mark A. Graves(11)..................................... 381,101 *
Barry L. Boniface(12).................................. 125,617 *
All directors and executive officers as a group (13
persons)(13).......................................... 28,341,072 59.1
</TABLE>
___________________
* Represents less than 1% of the outstanding shares of common stock.
(1) The address of Centennial Holdings V, L.P. and Mr. Schutz is 1428 15th
Street, Denver, CO 80202. The address of Alta Communications, Inc. and Mr.
Egan is One Post Office Square, Suite 3800, Boston, MA 02109. The address
of Beacon Capital Partners, Inc. and Mr. Halsted is One Federal Street, 26th
Floor, Boston, MA 02110. The address of Nassau Capital L.L.C. and Mr. Hack
is 22 Chambers Street, Princeton, NJ 08542. The address of Gramercy
Communications Partners, Inc. and Mr. Grafstein is 712 Fifth Avenue, 43rd
Floor, New York, NY 10019. The address of P. Eric Yopes is c/o Shorenstein
Management, Inc., 555 California Street, 49th Floor, San Francisco, CA
94104. The address of all other listed stockholders is c/o Cypress
Communications, Inc., Fifteen Piedmont Center, Suite 100, Atlanta, GA 30305.
(2) Represents shares of common stock beneficially owned by investment funds
affiliated with Centennial Holdings V, L.P., of which Mr. Shutz is a general
partner, including 8,028,428 shares of common stock beneficially owned by
Centennial Fund V, L.P. and 211,725 shares of common stock beneficially
owned by Centennial Entrepreneurs Fund V, L.P. Mr. Shutz disclaims
beneficial ownership of the shares of common stock held by these funds,
except to the extent of his proportionate pecuniary interest in such funds.
(3) Represents shares of common stock beneficially owned by investment funds
affiliated with Alta Communications, Inc., of which Mr. Egan is a general
partner, including 5,981,903 shares of common stock beneficially owned by
Alta Communications VI, L.P. and 136,794 shares of common stock beneficially
owned by Alta Comm S by S, LLC. Mr. Egan disclaims beneficial ownership of
the shares of common stock held by these funds, except to the extent of his
proportionate pecuniary interest in such funds.
(4) Represents shares of common stock beneficially owned by entities affiliated
with Beacon Capital Partners, Inc., of which Mr. Halsted is an executive
officer, including 204,241 shares of common stock beneficially owned by
Tenant Communications, Inc., 4,029,310 shares of common stock beneficially
owned by Building Communications, LLC and 118,421 shares of common stock
beneficially owned by Investor
15
<PAGE>
Communications LLC. Mr. Halsted disclaims beneficial ownership of the
shares of common stock held by these funds, except to the extent of his
proportionate pecuniary interest in such funds. On January 3, 2000, the
shares of common stock owned by Tenant Communications, Inc. and Building
Communications, LLC were transferred to an affiliated voting trust.
(5) Represents shares of common stock beneficially owned by investment funds
affiliated with Nassau Capital L.L.C., of which Mr. Hack is a member,
including 2,914,145 shares of common stock beneficially owned by Nassau
Capital Partners III L.P. and 46,380 shares of common stock beneficially
owned by NAS Capital Partners I L.L.C. Mr. Hack disclaims beneficial
ownership of the shares of common stock held by these funds, except to the
extent of his proportionate pecuniary interest in such funds.
(6) Represents shares of common stock beneficially owned by Gramercy Cypress
LLC, an investment fund affiliated with Gramercy Communications Partners,
Inc., of which Mr. Grafstein is a Managing Director. Mr. Grafstein
disclaims beneficial ownership of the shares of common stock held by this
fund, except to the extent of his proportionate pecuniary interest in such
fund.
(7) Mr. Blount was appointed Chairman and Chief Executive Officer effective as
of June 1, 2000.
(8) Includes 361,269 shares of common stock held by Mr. Allen subject to
options exercisable as of June 2, 2000 or within 60 days thereafter.
(9) Includes 361,269 shares of common stock held by Mr. Bourdeaux subject to
options exercisable as of June 2, 2000 or within 60 days thereafter.
(10) Represents shares of common stock beneficially owned by DWS Capital LLC, an
investment fund affiliated with Shorenstein Management, Inc., of which Mr.
Yopes is an executive officer. Mr. Yopes disclaims beneficial ownership of
the share of common stock held by this fund, except to the extent of his
proportionate pecuniary interest in such fund.
(11) Includes 208,163 shares of common stock held by Mr. Graves subject to
options exercisable as of June 2, 2000 or within 60 days thereafter.
(12) Includes 49,556 shares of common stock held by Mr. Boniface subject to
options exercisable as of June 2, 2000 or within 60 days thereafter.
(13) Includes 966,757 shares of common stock held by all directors and executive
officers as a group subject to options exercisable as of June 2, 2000 or
within 60 days thereafter.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires our executive officers and directors, and persons who
own more than 10% of a registered class of Cypress Communications' equity
securities, to file reports of ownership and changes in ownership with the SEC.
Officers, directors and greater than 10% beneficial owners are required by SEC
regulations to furnish us with copies of all Section 16(a) forms they file.
Because Cypress Communications was not subject to the reporting
requirements of the Exchange Act during 1999, none of our executive officers,
directors or greater than 10% beneficial owners were subject to the provisions
and filing requirements of Section 16(a) during 1999.
16
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
In the fourth quarter of 1999, Cypress Communications issued an aggregate
of 4,161,974 shares of series C preferred stock to investors, including Messrs.
Allen, Bourdeaux, Graves and Boniface, Centennial Holdings V, L.P., Alta
Communications, Beacon Capital Partners, Nassau Capital and Gramercy
Communications Partners for $19 per share. Pursuant to the terms of the
preferred stock (as adjusted to reflect the 4.5-for-1 stock split which occurred
on February 8, 2000), each share of preferred stock automatically converted into
4.5 shares common stock upon the completion of our initial public offering on
February 15, 2000.
Certain of our directors are affiliated with certain of our principal
stockholders. Mr. Schutz is a general partner of Centennial Holdings V, L.P. Mr.
Egan is a general partner of Alta Communications. Mr. Halsted is an executive
officer of Beacon Capital Partners. Mr. Hack is a member of Nassau Capital. Mr.
Grafstein is a Managing Director of Gramercy Communications Partners.
One of our directors, Mr. Yopes, is an executive officer of Shorenstein
Management, Inc. In December 1999, we issued 184,211 shares of our series C
preferred stock to an investment fund affiliated with Shorenstein for $19 per
share. In addition, as part of our November/December master license agreement
program, we entered into a master license agreement with Shorenstein under which
we have obtained the right to install and operate our networks in up to 21
buildings representing more than 15 million rentable square feet. Upon the
execution of property-specific license agreements with respect to these
buildings, we will be required to pay Shorenstein, or the appropriate property
owner, approximately 6% of the revenues generated from tenants in those
buildings. In connection with the execution of this master license agreement, we
also issued Shorenstein warrants to acquire up to 815,109 shares of our common
stock at an exercise price of $4.22 per share. The warrants are exercisable for
a period of ten years, but cannot be exercised until six months following the
completion of this offering.
On June 13, 2000, we paid one of our principal stockholders, Gramercy
Communications Partners, $119,017 for consulting services performed for Cypress
Communications by employees of Gramercy. As noted above, one of our directors,
Mr. Grafstein, is a Managing Director of Gramercy.
We believe that each of the transactions described above was entered into
on terms no less favorable to us than could be obtained with non-affiliated
parties. For all future transactions, we have adopted a conflict of interest
policy whereby our Audit Committee will review the fairness of all material
transactions between Cypress Communications and our officers, directors and
other affiliates and will make recommendations after such review to the entire
Board of Directors.
17
<PAGE>
OTHER MATTERS
Independent Public Accountants
The Board of Directors has selected the accounting firm of Arthur Andersen
LLP to serve as the independent public accountants of Cypress Communications for
the current fiscal year. Arthur Anderson LLP has served as our public
accountants since our formation in July 1997. A representative of Arthur
Andersen LLP will be present at the annual meeting, will be given the
opportunity to make a statement if he or she so desires, and will be available
to respond to appropriate questions.
Expenses of Solicitation
The cost of solicitation of proxies will be borne by Cypress
Communications. In an effort to have as large a representation at the meeting as
possible, special solicitation of proxies may, in certain instances, be made
personally or by mail, facsimile, telephone, telegraph or other electronic media
by one or more of our employees. Cypress Communications may also reimburse
brokers, banks, nominees and other fiduciaries for postage and reasonable
clerical expenses of forwarding the proxy material to their principals who are
beneficial owners of shares of common stock.
Stockholder Proposals
Any stockholder proposals submitted pursuant to Exchange Act Rule 14a-8 and
intended to be presented at the 2001 annual meeting must be received in writing
at our principal executive offices on or before March 2, 2001 to be eligible for
inclusion in the proxy statement and form of proxy to be distributed by the
Board of Directors in connection with such meeting.
Any stockholder proposals intended to be presented at the 2001 annual
meeting, other than a stockholder proposal submitted pursuant to Exchange Act
Rule 14a-8, must be received in writing at our principal executive offices no
later than June 1, 2001 nor prior to May 2, 2001, together with all supporting
documentation required by our bylaws. Proxies solicited by the Board of
Directors will confer discretionary voting authority with respect to these
proposals, subject to SEC rules governing the exercise of this authority.
General
The Board of Directors does not know of any other matters to be presented
at the annual meeting. If any additional matters are properly presented, the
persons named in the proxy will have discretion to vote in accordance with their
own judgment on such matters.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Mark A. Graves
------------------
Mark A. Graves
Secretary
18
<PAGE>
DETACH HERE
PROXY
CYPRESS COMMUNICATIONS, INC.
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON TUESDAY, AUGUST 15, 2000
The undersigned hereby constitutes and appoints R. Stanley Allen and Barry
L. Boniface, and each of them, as Proxies of the undersigned, with full power to
appoint his substitute, and authorizes each of them to represent and to vote all
shares of common stock of Cypress Communications, Inc. (the "Company") held of
record by the undersigned as of the close of business on Friday, June 23, 2000,
at the Annual Meeting of Stockholders (the "Annual Meeting") to be held at the
Auditorium at Fourteen Piedmont Center, Atlanta, Georgia 30305 at 8:30 a.m.,
local time, on Tuesday, August 15, 2000, and at any adjournments or
postponements thereof.
When properly executed, this proxy will be voted in the manner directed
herein by the undersigned stockholder(s). If no direction is given, this proxy
will be voted "FOR" the election of the three nominees of the Board of Directors
listed in Proposal 1. In their discretion, the Proxies are authorized to vote
upon such other business as may properly come before the Annual Meeting and any
adjournments or postponements thereof. A stockholder wishing to vote in
accordance with the Board of Directors' recommendations need only sign and date
this proxy and return it in the enclosed envelope.
The undersigned hereby acknowledges receipt of a copy of the accompanying
Notice of the Annual Meeting of Stockholders, the Proxy Statement with respect
thereto and the Company's 1999 Annual Report to Stockholders, and hereby
revokes any proxy or proxies heretofore given. This proxy may be revoked at any
time before it is exercised.
Please vote and sign on other side and return promptly in the enclosed
envelope (which requires no postage if mailed within the United States).
----------- -----------
SEE REVERSE SEE REVERSE
SIDE CONTINUED AND TO BE SIGNED ON REVERSE SIDE SIDE
----------- -----------
<PAGE>
<TABLE>
<CAPTION>
------------------- -------------------
Vote by Telephone Vote by Internet
------------------- -------------------
<S> <C>
It's fast, convenient, and immediate! It's fast, convenient, and your vote is immediately
Call Toll-Free on a Touch-Tone Phone confirmed and posted.
1-877-PRX-VOTE (1-877-779-8683).
------------------------------------------------------- ----------------------------------------------------
Follow these four easy steps: Follow these four easy steps:
1. Read the accompanying Proxy Statement and 1. Read the accompanying Proxy Statement and
Proxy Card. Proxy Card.
2. Call the toll-free number 2. Go to the Website
1-877-PRX-VOTE (1-877-779-8683). http:/www.eproxyvote.com/cyco
3. Enter your 14-digit Voter Control Number 3. Enter your 14-digit Voter Control Number
located on your Proxy Card above your name. located on your Proxy Card above your name.
4. Follow the recorded instructions. 4. Follow the instructions provided.
------------------------------------------------------- ----------------------------------------------------
Your vote is important! Your vote is important!
Call 1-877-PRX-VOTE anytime! Go to http://www.eproxyvote.com/cyco anytime!
</TABLE>
Do not return your Proxy Card if you are voting by Telephone or Internet.
DETACH HERE
[X] Please mark
votes as in
this example.
<TABLE>
<S> <C>
The Board of Directors unanimously recommends a vote FOR the nominees.
1. Election of three Class I Directors to serve until the 2003 Annual
Meeting and until their successors are duly elected and qualified.
Nominees: (01) Ward C. Bourdeaux Jr.
(02) William P. Egan and
(03) Jeffrey H. Schutz
FOR [_] [_] WITHHOLD
FOR
ALL
EXCEPT
[_] ------------------------------------------------------------
If you do not want your shares voted FOR a particular nominee, mark
the FOR ALL EXCEPT box and write that nominee's name in the space
provided above.
MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT [_]
MARK HERE IF YOU PLAN TO ATTEND THE MEETING [_]
Please sign your name exactly as shown. Where
there is more than one holder, each should sign.
When signing as an attorney, administrator,
executor, guardian or trustee, please add your title
as such. If executed by a corporation or
partnership, the proxy should be signed by a duly
authorized person, stating his or her title or
authority.
</TABLE>
Signature: _______________ Date: _____ Signature: _______________ Date: _____
