SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
NEW ULM TELECOM, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transactions 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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NOTICE OF ANNUAL MEETING
AND
PROXY STATEMENT
NEW ULM TELECOM, INC.
400 SECOND STREET NORTH
NEW ULM, MN 56073
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 4, 2000
Notice is hereby given that the Annual Meeting of Shareholders of New
Ulm Telecom, Inc. will be held in the German Rivers Room, Holiday Inn, 2101 S.
Broadway, New Ulm, Minnesota on Thursday, May 4, 2000 at 10:00 a.m. for the
following purposes:
1. To elect three (3) directors for a term of three (3) years each to hold
office until the Annual Meeting of Shareholders to be held in May of
the year 2003 or until their successors are elected.
2. To consider and vote on a Resolution amending Article IV of the
Articles of Incorporation to read:
"The government of said corporation for the management of its affairs,
shall be vested in a Board of nine (9), who shall be stockholders. The
number of directors will be reduced to eight (8) at the Annual Meeting
in 2001 and reduced to seven (7) at the Annual Meeting in 2002 and
shall thereafter remain at seven, unless and until this Article is
amended. The directors shall be elected to office at the Annual Meeting
of stockholders of the corporation to be held in New Ulm, Minnesota or
at such other place as designated by a Resolution of the Board of
Directors during the month of May in each year.
Each director shall be elected to office for a term of three (3) years
and shall continue to serve until the director's successor has been
duly elected and qualified. Any vacancy that may occur shall be filled
by appointment by the Board until the next Annual Meeting, at which
time a director will be elected by the stockholders to fill the
unexpired term."
3. To consider and vote on a Resolution amending Section 8, paragraphs (b)
and (c) of the By-Laws, in their entirety to read as follows:
(b) No individual shall be eligible to be appointed or elected
as a director after attaining the age of 69.
(c) This eligibility restriction shall be effective as of the
date of the approval of the Resolution amending these By-Laws
by the membership at an Annual Meeting.
4. To ratify the appointment of Olsen Thielen & Co., Ltd. as auditors of
the Company for 2000.
5. To transact such other business as may properly come before the meeting
or any adjournment or adjournments thereof.
The Board of Directors have fixed the close of business on March 28, 2000 as the
record date for the determination of shareholders entitled to notice of and to
vote at the meeting.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ BARBARA A. J. BORNHOFT
SECRETARY
New Ulm, Minnesota
April 17, 2000
TO ASSURE YOUR REPRESENTATION AT THE MEETING, PLEASE SIGN,
DATE AND RETURN YOUR PROXY IN THE ENCLOSED ENVELOPE, WHETHER
OR NOT YOU EXPECT TO ATTEND IN PERSON. SHAREHOLDERS WHO
ATTEND THE MEETING MAY REVOKE THEIR PROXIES AND VOTE IN
PERSON IF THEY SO DESIRE.
<PAGE>
NEW ULM TELCOM, INC.
400 Second Street North
New Ulm, Minnesota 56073
507-354-4111
---------------------------
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
MAY 4, 2000
---------------------------
INTRODUCTION
This Proxy Statement and the enclosed Proxy, mailed on or about April
17, 2000, is made by the Board of Directors of New Ulm Telecom, Inc. (the
"Company") for use at the Annual Meeting and any adjournment thereof to be held
on May 4, 2000. Only shareholders of record at the close of business on March
28, 2000 will be entitled to vote at the meeting. You are urged to sign and
return the enclosed proxy whether or not you plan to attend the meeting. When
proxies are returned properly signed and dated, the shares represented thereby
will be voted according to your direction. You should specify your choices by
marking the appropriate boxes on the Proxy. If your Proxy does not specify a
choice, it will be voted FOR all items.
Any Proxy may be revoked at any time before it is voted by receipt of a
Proxy properly signed and dated subsequent to an earlier Proxy, or by revocation
of a written Proxy by request in person at the Annual Meeting. The persons named
as proxies were selected by the Board of Directors of the Company and are
directors or officers of the Company. The cost of this solicitation, including
preparing, assembling and mailing the Proxies and solicitation materials, will
be paid by the Company.
OUTSTANDING SHARES AND VOTING RIGHTS
The total number of shares outstanding as of March 28, 2000 and
entitled to vote at the meeting consisted of 1,732,455 shares of common stock.
For each share held, shareholders may cast one vote for each of the three
directorships to be filled at this meeting. Each shareholder entitled to vote
has the right to cumulative vote their shares in the election of directors by
giving written notice of intent to cumulative vote to any officer of the
corporation before the meeting, or to the presiding officer at the meeting at
any time before the election. If notice of intent to cumulative vote occurs, the
presiding officer at the meeting shall
<PAGE>
announce, before the election of directors, that shareholders shall cumulative
vote their shares by multiplying the number of shares held by the shareholder by
the number of directors to be elected. Each shareholder then may cast their
votes for one candidate or may distribute the votes among any number of
candidates.
The presence in person or by proxy of the holders of thirty-five
percent (35%) of the shares entitled to vote at the Annual Meeting of
Shareholders constitutes a quorum for the transaction of business.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The following table sets forth as of March 28, 2000, the number of
shares of the Company's common stock by each person known by the Company to own
of record or beneficially five percent (5%) or more of the Company's common
stock, and all officers and directors of the Company as a group.
Name & Address of Amount & Nature of Percent of
Beneficial Ownership Beneficial Ownership Ownership
- -------------------- -------------------- ---------
Ruth B. Wines, Trustee of
the Ralph K. Wines &
Ruth B. Wines Family Trust 91,440 5.3%
503 Ferndale Avenue
Corona Del Mar, California
All Directors & Officers as
a Group (12 persons) 137,441 7.9%(1)
- --------------------------
(1) Includes 27,826 shares owned by the spouses of directors and
officers.
ELECTION OF DIRECTORS
The Board of Directors has nominated and recommends for election as
Directors of the Company the three persons named herein. It is intended that
proxies will be voted for such nominees. The Board of Directors believes that
each nominee named herein will be able to serve, but should a nominee be unable
to serve as a Director, the persons named in the proxies have advised that they
will vote for the election of such substitute nominee as the Board of Directors
may propose.
Information regarding the nominees and other directors filling
unexpired terms, including information regarding their principal occupations, is
on the next page. Ownership of common stock of the Company by such nominees is
given as of March 28, 2000. To the best of the Company's knowledge, unless
otherwise indicated, the persons indicated possess sole voting and investment
power with respect to their stock ownership.
<PAGE>
<TABLE>
<CAPTION>
NOMINEES PROPOSED FOR ELECTION FOR TERMS EXPIRING IN 2003
(Including business experience during the past five years.)
- -----------------------------------------------------------
Principal Director Year Term Stock
Name & Age Occupation Since Expires Ownership Percent
- ---------- ---------- ----- ------- --------- -------
<S> <C> <C> <C> <C> <C>
MARY ELLEN DOMEIER President, State 1999 2000 450 *
(58) Bank & Trust Co.
ROSEMARY DITTRICH Corporate 1997 2000 3,676 (1) .2%
(58) Secretary, D & A Trucking, Inc.
GARY NELSON General Mgr., 1982 2000 10,000 (2) .6%
(62) Nelson-Riedman Insurance
NOMINEES PROPOSED FOR ELECTION FOR TERMS EXPIRING IN 2001
(Including business experience during the past five years.)
- -----------------------------------------------------------
LAVERN BIEBL Retired Salesman 1983 2001 14,350 .8%
(72)
JAMES JENSEN President, Jensen 1982 2001 5,581 (3) .3%
(55) Clothing, Inc.
PERRY MEYER Farmer 1995 2001 4,000 .2%
(45)
NOMINEES PROPOSED FOR ELECTION FOR TERMS EXPIRING IN 2002
(Including business experience during the past five years.)
- -----------------------------------------------------------
ROBERT RANWEILER Principal of 1989 2002 21,450 (4) 1.2%
(52) Biebl, Ranweiler & Co. Chartered,
a Professional Accounting Corporation
MARK RETZLAFF President, 1958 2002 7,484 .4%
(71) Retzlaff Hardware
DUANE LAMBRECHT Owner/CEO, 1999 2002 100 *
(53) Shelter Products, Inc.
</TABLE>
* Less than .1%
(1) Includes 1,500 shares owned by Ms. Dittrich's spouse.
(2) Includes 4,558 shares owned by Mr. Nelson's spouse.
(3) Includes 1,218 shares owned by Mr. Jensen's spouse.
(4) Includes 20,550 shares owned by Mr. Ranweiler's spouse.
<PAGE>
The Board of Directors consists of nine members with staggered terms of
three years for each Director. The Board holds regular monthly meetings and some
special meetings. The Board held 13 meetings in 1999. All directors attended 75%
or more of the Board meetings and applicable Committee meetings.
COMMITTEES OF THE BOARD
The Audit Committee, which consists of Lavern Biebl, Perry Meyer and
Robert Ranweiler, meets as required. The Audit Committee reviews the activities
and reports of the independent auditors. This committee had 2 meetings in 1999.
The Steering Committee consists of James Jensen, Lavern Biebl, Gary
Nelson and Mark Retzlaff. This committee is responsible for the study and
analysis of the Company's financial needs and requirements and the evaluation of
the future operations and needs of the Company. The Steering Committee meets as
required.
The Personnel Committee consists of Gary Nelson, Duane Lambrecht and
Perry Meyer. Its duties are to evaluate employee compensation and staffing. The
Personnel Committee also makes appropriate recommendations concerning officers'
and directors' compensation. This committee had 5 meeting in 1999.
The Company also has a Strategic Planning Committee and an Ad Hoc Stock
Marketability Committee. These committees meet as required.
The Board of Directors as a whole is the Nominating Committee.
In addition, the Chairman of the Board is an ex officio member of all
committees.
COMPENSATION OF DIRECTORS
In 1999, each Director was paid an annual retainer at the rate of
$10,511.68 per year from New Ulm Telecom, Inc.; $2,167.88 per year from Western
Telephone Company; $784.44 per year from Peoples Telephone Company and $136 per
year split evenly between the other six subsidiaries of New Ulm Telecom, Inc.
This retainer covers all Committee and Board meetings.
EXECUTIVE OFFICERS
NAME AND AGE POSITION TERM OF OFFICE
- ------------------- ------------ --------------------
JAMES JENSEN Chairman 1-year Term Expiring
(55) in May, 2000. Secretary from
1989-1993. President from
1993-1999.
<PAGE>
EXECUTIVE OFFICERS (CONTINUED)
NAME AND AGE POSITION TERM OF OFFICE
- ------------------- ------------ --------------------
BILL OTIS President 1-year Term Expiring
(42) in 2000. General
Manager since 1985.
Executive Vice-
President since 1993.
President since 1999.
BARBARA BORNHOFT Vice-President/Secretary One-year term expiring
(43) in 2000.
CHRISTOPHER HOPP Controller/Treasurer One-year term expiring
(31) in 2000.
There neither are nor have there been any agreements between the
above-named officers and any other persons relative to the selection of any
officers.
The Company's officers and directors are required to file reports of
their beneficial ownership with the Securities and Exchange Commission.
According to the Company's records, during the period from January 1, 1999 to
December 31, 1999, officers and directors of the Company filed all reports with
the Securities and Exchange Commission required under Section 16(a) to report
their beneficial ownership.
EXECUTIVE COMPENSATION
The Company maintains a consistent compensation philosophy for all
employees. This philosophy rewards the coordinated efforts of the employees in
meeting corporate objectives, as well as meeting the expectations of its
customers and shareholders. The compensation program for executives is the
responsibility of the Board of Directors. The philosophy for the executive
salary program is to pay competitively compared to similar-sized companies,
particularly technology companies.
<PAGE>
The table below sets forth the cash and non-cash compensation for each
of the last three fiscal years ending December 31, 1999 for the President.
SUMMARY COMPENSATION TABLE
Annual Compensation
-------------------
All Other
Name and Position Year Salary Bonus Compensation($)(1-2)
- ----------------- ---- ------ ----- --------------------
Bill Otis, President 1999 $125,000 $15,625 $8,227
1998 117,616 15,600 7,408
1997 102,924 10,600 7,438
(1) Contributions from the Company to the 401(k) plan.
(2) Notes Receivable includes $700,000 from the President. The note is secured
by 51,230 shares of stock in New Ulm Telecom, Inc. and has a variable interest
rate which was 5.2% at December 31, 1999. Interest payments are to be paid
annually on December 31. The note is to be paid in full on January 1, 2001.
Note: Certain columns have not been included in the table because the
information called for therein is not applicable to the Company or the
individual named above for the periods indicated.
EMPLOYEE 401(k) SAVINGS PLAN
The Company has a 401(k) Employee Savings Plan in effect for employees
who meet certain age and service requirements. The Company makes matching
contributions of 50% of the employee's contribution, up to 6% of compensation.
In 1999, the Company also contributed an additional 3.9274% of the covered
employee's compensation, over and above the normal matching amount.
AMENDMENT TO THE ARTICLES OF INCORPORATION
OF NEW ULM TELECOM, INC. (PROPOSAL #2)
"RESOLVED, that Article IV of the Articles of Incorporation be amended
to read as follows:
"ARTICLE IV
The government of said corporation for the management of its affairs,
shall be vested in a Board of nine (9), who shall be stockholders. The
number of directors will be reduced to eight (8) at the annual meeting
in 2001 and reduced to seven (7) at the annual meeting in 2002 and
shall thereafter remain at seven, unless and until this Article is
amended.
<PAGE>
Article IV (continued)
The directors shall be elected to office at the annual meeting of
stockholders of the corporation to be held in New Um, Minnesota, or at
such other place as designated by a Resolution of the Board of
Directors during the month of May in each year.
Each director shall be elected to office for a term of three (3) years
and shall continue to serve until the director's successor has been
duly elected and qualified. Any vacancy that may occur shall be filled
by appointment by the Board until the next annual meeting, at which
time a director will be elected by the stockholders to fill the
unexpired term."
YOUR DIRECTORS RECOMMEND A VOTE FOR THIS AMENDMENT.
AMENDMENT TO THE BY-LAWS OF
NEW ULM TELECOM, INC. (PROPOSAL #3)
"RESOLVED, that Section 8, paragraphs (b) and (c), be amended in their
entirety to read as follows:
(b) No individual shall be eligible to be appointed or elected as
a director after attaining the age of 69.
(c) This eligibility restriction shall be effective as of the date
of the approval of the Resolution amending these By-Laws by
the membership at an annual meeting.
YOUR DIRECTORS RECOMMEND A VOTE FOR THIS AMENDMENT.
THE COMPANY'S AUDITORS (PROPOSAL #4)
Olsen Thielen & Co., Ltd. has been the auditors for the Company for
many years. The Board of Directors proposes and recommends the re-election of
the firm of Olsen Thielen & Co., Ltd. to perform an audit for the current fiscal
year ending December 31, 2000.
A representative of Olsen Thielen & Co., Ltd. is expected to be present
at the Annual Meeting of Shareholders and will have an opportunity to make a
statement and will be available to respond to appropriate questions. The Board
of Directors has been advised by Olsen Thielen & Co., Ltd. that no member of
that firm has any financial
<PAGE>
interest, either direct or indirect, in the Company, and that during the past
three years, has had no connection with the Company in any capacity other than
that of independent certified public accountants.
YOUR DIRECTORS RECOMMEND A VOTE FOR OLSEN THIELEN & CO., LTD.
SHAREHOLDERS' PROPOSALS
The Company welcomes any suggestions from its shareholders, and all
suggestions will be given careful consideration. Proposals intended to be
included in next year's Proxy Statement should be submitted to Bill Otis,
President, 400 Second Street North, New Ulm, MN 56073 no later than January 1,
2001.
OTHER MATTERS
Management knows of no other matters that will be presented at the
meeting. If any other matters arise at the meeting, it is intended that the
shares represented by the proxies in the accompanying form will be voted in
accordance with the judgment of the persons named in the Proxy.
ANNUAL REPORT TO THE SHAREHOLDERS
A copy of the Company's Annual Report to shareholders for the fiscal
year ended December 31, 1999, accompanies this Notice of Meeting and Proxy
Statement. No part of the Annual Report is incorporated in this Proxy Statement
and no part is to be considered Proxy solicitation material.
SHAREHOLDERS MAY RECEIVE, WITHOUT CHARGE, A COPY OF THE COMPANY'S 1999
FORM 10-K REPORT AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION BY WRITING
TO BILL OTIS, PRESIDENT, NEW ULM TELECOM, INC., 400 SECOND STREET NORTH, NEW
ULM, MN 56073.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ BARBARA A. J. BORNHOFT
SECRETARY
<PAGE>
NEW ULM TELECOM, INC.
PROXY
The undersigned hereby appoints Lavern Biebl, James Jensen, Perry
Meyer, Robert Ranweiler, Mark Retzlaff and Duane Lambrecht or any of them, with
power of substitution, as proxies to vote the shares of common stock of the
undersigned in NEW ULM TELECOM, INC. at the Annual Meeting of Shareholders to be
held May 4, 2000 at 10:00 a.m. in the German Rivers Room, Holiday Inn, 2101 S.
Broadway, New Ulm, Minnesota, and at any adjournment thereof, upon all business
that may properly come before the meeting, including the business identified
(and in the manner indicated) on this proxy and described in the proxy statement
furnished herewith.
Indicate your vote by an (X). The Board of Directors recommends voting
FOR all items.
ITEM
- ----
1. Election of Directors: _____ FOR - ALL Nominees _____ WITHHELD - ALL
Nominees (Except as marked to the contrary below.)
(3-year term)
Nominees: ROSEMARY DITTRICH, MARY ELLEN DOMEIER, GARY NELSON
INSTRUCTION: To withhold authority to vote for any nominee, mark
through that nominee's name.
2. Shall the resolution amending Article IV of the Articles of
Incorporation be adopted?
______ FOR _____ AGAINST _____ ABSTAIN
3. Shall the resolution amending Section 8, paragraphs (b) and (c) of the
By-Laws be adopted?
______ FOR _____ AGAINST _____ ABSTAIN
4. Appointment of Auditors: _____ FOR _____ AGAINST _____ ABSTAIN
Nominee: OLSEN THIELEN & CO., LTD., Certified Public Accountants
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS WHICH RECOMMENDS
VOTING FOR ALL ITEMS. IT WILL BE VOTED AS SPECIFIED. IF NOT SPECIFIED, THE
SHARES REPRESENTED BY THIS PROXY WILL BE VOTED FOR ALL ITEMS.
PLEASE SIGN AND RETURN PROMPTLY IN THE ENCLOSED, PRE-ADDRESSED
ENVELOPE.
SIGNATURE _____________________________________ DATE ___________________________
SIGNATURE _____________________________________ DATE ___________________________
Please sign exactly as name(s) appear on the mailing label. If joint account,
each joint owner should sign. If signing for a corporation or as an agent,
attorney or fiduciary, indicate the capacity in which you are signing.
