<PAGE> 1
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:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
[X] Definitive Proxy Statement Only (as permitted by Rule 14a-6(e)(2))
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec. 240.14a-11(c) or sec. 240.14a-12
</TABLE>
Franklin Telecommunications Corp.
- --------------------------------------------------------------------------------
(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] Fee not 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:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
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(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.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE> 2
FRANKLIN TELECOMMUNICATIONS CORP.
733 Lakefield Road
Westlake Village, CA 91361
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD JUNE 18, 1999
To the Holders of Common Stock of Franklin Telecommunications Corp.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
Franklin Telecommunications Corp. will be held at the Westlake Inn Hotel,
Lakeside Room, 32001 Agoura Road., Westlake Village, California 91361, on June
18, 1999, at 1:00 P.M., local time, for the following purposes:
1. To elect a board of five directors, with each director so
elected to hold office until the next Annual Meeting and until
their successors have been duly elected and qualified; and
2. To amend the Articles of Incorporation to change the name of
the Company to FTEL.COM.
3. To transact such other business as may properly come before
the Annual Meeting and any continuation or adjournment
thereof.
The Board of Directors has fixed the close of business on May 3, 1999
as the record date for the determination of the shareholders entitled to notice
of and to vote at the Annual Meeting, and only shareholders of record at the
close of business on that date will be entitled to vote at the Annual Meeting.
All shareholders are cordially invited to attend the Annual meeting in
person. YOU ARE URGED TO PROMPTLY COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED
PROXY IN THE ACCOMPANYING PRE-ADDRESSED, STAMPED ENVELOPE. Your proxy will not
be used if you are present at the Annual Meeting and desire to vote your shares
personally.
By Order of the Board of Directors,
Frank W. Peters, Chief Executive Officer
Westlake Village, California
May 17, 1999
IMPORTANT: IF YOU DO NOT EXPECT TO ATTEND THE MEETING IN PERSON, IT IS
IMPORTANT THAT YOUR SHARES BE REPRESENTED SO THAT THE PRESENCE OF A
QUORUM MAY BE ASSURED. PLEASE SIGN AND DATE THE ENCLOSED PROXY AND
MAIL IT PROMPTLY. NO POSTAGE REQUIRED IF MAILED IN THE UNITED
STATES.
<PAGE> 3
FRANKLIN TELECOMMUNICATIONS CORP.
733 Lakefield Road
Westlake Village, CA 91361
-------------------
PROXY STATEMENT
-------------------
ANNUAL MEETING OF SHAREHOLDERS
To Be Held June 18, 1999
This Proxy Statement is being furnished to the shareholders of Franklin
Telecommunications Corp., a California corporation (the "Company"), in
connection with the solicitation of proxies by the Company's Board of Directors
for use at the Annual Meeting of Shareholders of the Company to be held at the
Westlake Inn Hotel, Lakeside Room, 32001 Agoura Road., Westlake Village,
California 91361, on June 18, 1999, at 1:00 P.M, local time, and at any
continuation or adjournment thereof.
This Proxy Statement, and the accompanying Notice of Annual Meeting and
proxy card, are first being mailed on or about May 17, 1999 to shareholders of
record on May 3, 1999, the record date for the determination of the stockholders
entitled to notice of and to vote at the Annual Meeting. A copy of the Company's
Annual Report to Shareholders, which contains audited financial statements for
the fiscal year ended June 30, 1998 is concurrently being mailed to all
shareholders of record as of May 3, 1999.
The cost of soliciting proxies will be borne by the Company. In
addition to the solicitation of proxies by mail, solicitation may be made by
telephone, telegraph or personal interview by Directors, officers and other
regular employees of the Company, without extra compensation. Brokerage houses,
nominees, fiduciaries and other custodians will be requested to forward
soliciting material to the beneficial owners of shares and will be reimbursed
for their expenses.
VOTING RIGHTS
As of May 3, 1999, the record date for the determination of the
shareholders of the Company entitled to notice of and to vote at the Annual
Meeting, there were 25,206,719 shares of the Company's Common Stock outstanding.
Each share of Common Stock entitles the holder to one vote on each matter to
come before the Annual Meeting, except that shareholders may be entitled to
cumulative voting rights in the election of directors as describe below.
Cumulative voting rights entitle a shareholder to give one nominee that
number of votes equal to the number of directors to be elected multiplied by the
number of shares of Common Stock he or she is entitled to vote, or to distribute
such number of votes among two or more nominees in such proportion as the
shareholder may choose. The five nominees receiving the highest number of votes
at the Annual Meeting will be elected. In order for all shareholders to cumulate
votes, one shareholder must give notice to the Secretary prior to commencement
of voting that of his or her intention to cumulate his or her votes.
Properly executed and returned proxies, unless revoked, will be voted
as directed by the shareholder or, in the absence of such direction, by the
persons named therein FOR the election of the seven director nominees listed
below. As to any other business which may properly come before the Annual
Meeting, the proxy holders will vote in accordance with their best judgment. A
proxy may be revoked at any time before it is voted by delivery of written
notice of revocation to the Secretary of the Company or by delivery of a
subsequently dated proxy, or by attendance at the Annual Meeting and voting in
person. Attendance at the Annual Meeting without also voting will not in and of
itself constitute the revocation of a proxy.
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<PAGE> 4
PRINCIPAL HOLDERS OF VOTING SECURITIES
The following table sets forth information regarding the ownership of
the Company's Common Stock as of May 3, 1999, by (i) each of the current
directors and nominees for election as a director of the Company, (ii) each
person or group known by the Company to be the beneficial owner of more than 5%
of the Company's outstanding Common Stock, and (iii) all current directors and
executive officers of the Company as a group. Except as otherwise noted and
subject to community property laws where applicable, each beneficial owner has
sole voting and investment power with respect to all shares shown as
beneficially owned by them. Except as otherwise indicated, the address of each
holder identified below is in care of the Company, 733 Lakefield Road, Westlake
Village, California 91361.
<TABLE>
<CAPTION>
Name and Address Shares Percent of
of Beneficial Owner Beneficially Owned (1) Class (1)
- ------------------- ---------------------- ----------
<S> <C> <C>
Frank W. Peters 5,325,893 21%
Thomas Russell 248,000 1%
Peter S. Buswell 182,500 1%
Robert S. Harp 12,500 -0-
Herb Mitchell 2,000 -0-
All directors and executive officers of
the Company as a group (5 persons) 5,770,893 23%
</TABLE>
- -----------
(1) In calculating beneficial and percentage ownership, all shares of Common
Stock, which a named shareholder will have the right to acquire within 60
days of the record date for the Annual Meeting upon exercise of stock
options and stock purchase warrants are deemed to be outstanding for the
purpose of computing the ownership of such shareholder, but are not deemed
to be outstanding for the purpose of computing the percentage of Common
Stock owned by any other shareholder. As of May 3, 1999, an aggregate of
25,206,719 shares of Common Stock were outstanding.
ELECTION OF DIRECTORS
The Company's current Board of Directors has nominated five individuals,
Frank W. Peters, Peter S. Buswell, Robert S. Harp, Thomas Russell and Herb
Mitchell, for election as directors of the Company at the Annual Meeting, each
to serve as such until the next annual meeting of the Company's shareholders and
until their respective successors are elected and qualified. Each of the
nominees is a current member of the Company's Board of Directors. Although it is
not presently contemplated that any nominee will decline or be unable to serve
as a Director, in either such event, the proxies will be voted by the proxy
holders for such other persons as may be designated by the present Board of
Directors should any nominee become unavailable to serve. In the event that
anyone other than the five nominees listed below should be nominated for
election as a director, the persons named in the accompanying proxy will have
the authority, to be exercised in their discretion, to vote cumulatively for
less than all of the nominees. The five nominees receiving the highest number of
votes at the Annual Meeting will be elected.
NOMINEES
Certain information concerning the five individuals nominated by the
Company's Board of Directors for election at the Annual Meeting to serve as
directors of the Company for the ensuing year is set forth below:
3
<PAGE> 5
Mr. Peters has been Chairman and Chief Executive Officer of the Company
since its organization in 1981. Between 1975 and 1984 he was also President of
Franklin Data Systems and Franklin Systems Corporation. From 1973 to 1975, he
was Vice President of Jacquard Systems Corporation, a computer hardware and word
processing software development marketer.
Mr. Buswell has been President and Chief Operating Officer of the Company
since June, 1998. Previously, Mr. Buswell was the President of Xantel, since
1996, and Chief Marketing Officer for TAA, a software developer engaged in the
development of enterprise wide mixed media messaging systems. During the 1980s
he was manager of Strategic Planning for the Communications Systems Group of
Exxon Enterprises, the venture capital unit of Exxon. He has also served as
Director of Product Line Management at ITT and as Manager of Program Development
at Datapoint. Mr. Buswell has been a director of the Company since 1996.
Dr. Harp has been Chairman of Quesant Instruments, a manufacturer of
scanning probe microscopes, since 1992. Between 1987 and 1992, he was Chairman
of Vertek, a manufacturer of PC peripheral devices. He is also a founder of
Vector Graphic, Inc. Dr. Harp has been a director of the Company since 1996.
Mr. Russell has been the Chief Financial Officer and a director of the
Company since 1996. He also served as its Chief Financial Officer between 1988
and 1990. Between 1990 and 1996 Mr. Russell was President of Russell Industries,
a manufacturer's representative and distribution firm for optical storage memory
products. Prior to that time Mr. Russell was a founder and CFO of Plasmon PLC, a
UK based manufacturer of optical media and jukeboxes for the computer industry
and partner at Sorenson, Russell & Company, a public accounting firm, and was
employed by Peat Marwick. Mr. Russell is a Certified Public Accountant.
Mr. Mitchell has thirteen years experience as a stock broker with
Hornblower & Weeks in Boston. He negotiated the first cultural exchange program
between Los Angeles and her sister city Leningrad (now St. Petersburg) for which
he received a commendation from the Mayor of LA. He is currently enjoying a
successful career as an actor, writer and producer for theatre, motion pictures
and television.
STRUCTURE AND FUNCTION OF THE BOARD OF DIRECTORS
During the last fiscal year, the Company's Board of Directors held four
regular and special meetings or otherwise took action by written consent. The
Board has established an Audit Committee, comprised of Messrs. Harp, Mitchell
and Russell, and a Compensation Committee, comprised of Messrs. Peters, Harp
and Mitchell. The Audit Committee meets to consult with the Company's
independent auditors concerning their engagement and audit plan, and thereafter
concerning the auditor's report and management letter and with the assistance of
the independent auditors, also monitors the adequacy of the Company's internal
accounting controls. With respect to compensation, the Compensation Committee
determines the compensation of corporate officers, and will determine the
persons entitled to participate in stock option, bonus and other similar plans.
The Board of Directors continues to meet as a whole to nominate the individuals
to be proposed by the Board of Directors for election as directors of the
Company, and has no separate nominating committee.
Each non-employee director is paid an annual retainer of $ -0- plus $ -0-
per each board meeting attended and each board committee meeting attended for
each committee of which they are a member. The Company has and will continue to
pay the expenses of its non-employee directors in attending Board meetings. No
compensation is paid to any of the employee directors.
There is no family relationship between any nominee and any other nominee
or executive officer of the Company.
EXECUTIVE OFFICERS
The executive officers of the Company are Frank W. Peters, Chief Executive
Officer, Peter S. Buswell, President and Chief Operations Officer and Thomas
Russell, Chief Financial Officer. Subject to the terms of applicable employment
agreement, officers serve at the pleasure of the Board of Directors.
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<PAGE> 6
EXECUTIVE COMPENSATION
The following table sets forth certain compensation paid or accrued by the
Company during the years ended June 30, 1997 and June 30, 1998 to its President
and its Chief Financial Officer (the "Named Executive Officers").
<TABLE>
<CAPTION>
ANNUAL COMPENSATION
------------------------------- ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION
--------------------------- ---- -------- -------- ------------
<S> <C> <C> <C> <C>
Frank W. Peters, President..................... 1997 $291,556(1) $100,000 -0-
1998 $309,048(1) -0- -0-
Peter S. Buswell(2)............................ 1997 $ -0- -0-
1998 $ 16,298 -0-
Thomas Russell, Chief Financial Officer(3)..... 1997 $ 60,208 $ 10,000 -0-
1998 $109,167 $ 5,000 -0-
</TABLE>
- ----------
(1) Portions of these amounts were deferred. See "Transactions with
Management," below.
(2) Mr. Buswell was employed by the Company beginning in June 1998.
(3) Mr. Russell was employed by the Company beginning in October 1996.
Except as disclosed above, no compensation characterized as long-term
compensation, including restricted stock awards issued at a price below fair
market value or long-term incentive plan payouts, were paid by the Company
during the years ended June 30, 1997 and 1998 to any of the Named Executive
Officers.
EMPLOYMENT AGREEMENTS
The Company's CEO is employed pursuant to a six year Employment Agreement,
effective January 1, 1998. The Employment Agreement provides for compensation at
the rate of $27,000 per month, with annual increases of 6%. The Company's
President is employed pursuant to a two year Employment Agreement, commencing
within June 1998. The Employment Agreement provides for compensation at the rate
of $18,750 per month, with annual increases of 6%. The Company's Chief Financial
Officer is employed pursuant to Employment Agreement for a two year period,
commencing on January 10, 1999, providing monthly compensation at the rate of
$12,500 per month, with annual increases of 6%.
STOCK OPTIONS
The Company's 1986 Stock Option Plan, as amended (the "1986 Plan"),
authorizes the granting of options to employees that are intended to qualify as
"incentive stock options" under the Internal Revenue Code of 1986 ("Incentive
Stock Options"), as well as stock options that are not intended to so qualify
("Nonstatutory Options"), which may be granted to officers, directors,
employees, consultants, and others expected to provide significant services to
the Company or its subsidiaries. The 1986 Plan, which is administered by the
Board of Directors, currently covers an aggregate of 700,000 shares. The maximum
term of a stock option granted under the 1986 Plan is ten years, but if the
optionee at the time of grant has voting power over more than 10% of the
Company's stock, the maximum term is five years. If an option granted expires or
terminates, the shares subject to the unexercised portion of that option will
become available for the grant of future options under the 1986 Plan. If an
optionee terminates his or her service to the Company, the optionee may exercise
only those option shares vested as of the date of termination and must effect
such exercise within three months, although the Board of Directors may set a
longer period for exercise of stock options. The 1986 Plan may be amended at any
time by the Board of Directors, although certain amendments would require
shareholder approval.
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<PAGE> 7
The exercise price of Incentive Stock Options granted under the 1986 Plan
must be at least equal to the fair market value of the stock subject to the
option on the date of grant, except that the exercise price of an Incentive
Stock Option granted to an optionee who owns stock possessing more than 10% of
the voting power of the Company's outstanding capital stock must equal at least
110% of the fair market value of the stock subject to the option on the date of
grant. The exercise price of Nonstatutory Stock Options granted under the 1986
Plan must be at least equal to 85% of the fair market value of the stock subject
to the option on the date of the grant. Payment of the exercise price may be
made in cash, promissory notes or other consideration as determined by the Board
of Directors.
The Company has also adopted a 1988 Stock Option Plan on substantially
similar terms as the 1986 Plan. The 1988 Plan covers 300,000 shares. In 1994 the
Company adopted an Incentive Stock Option Plan, providing for the grant of
incentive stock options to purchase up to 600,000 shares on substantially the
same terms as the incentive stock options under the 1986 Plan. In 1995 the
Company adopted its 1994 Nonstatutory Stock Option Plan, which provides for the
grant of nonstatutory options to purchase up to 1,400,000 shares on
substantially the same terms as the Nonstatutory Options under the 1986 Plan.
During the year ended June 30, 1998, the Company adopted the 1998 Stock
Option Plan (the "1998 Plan"). The 1998 Plan provides for the granting of
options to purchase up to 2,000,000 shares of common stock that are intended to
qualify as incentive stock options within the meaning of Section 422A of the
Internal Revenue Code.
CERTAIN TRANSACTIONS
During the year ended June 30, 1995, the Company issued notes for an
aggregate of $217,000 payable to its CEO, Frank W. Peters, in lieu of
compensation, included in the table above. These notes bear interest at the rate
of 9% per annum and are due and payable as follows: $12,000 due on August 20,
1995, $65,000 due on August 20, 1997, and $140,000 due on January 5, 1999. Mr.
Peters has waived any defaults or penalties with respect to the unpaid portions
of these notes. The $140,000 note is convertible into shares of the Company's
Common Stock at a conversion price of $.10 per share.
During the year ended June 30, 1995, the Company issued 2,000,000 shares to
its CEO, Frank W. Peters, upon exercise of options previously granted. The
exercise price was paid by the cancellation of notes in the amount of $92,000
and accrued interest in the amount of $42,000.
During the year ended June 30, 1996, the Company transferred 4,200,000 of
its shares of FNet to its CEO, Frank W. Peters, and to Colin Patterson, who was
a director of the Company at the time, in cancellation of notes payable and for
consulting services. Management of the Company valued the FNet shares at $.015
per share, based upon the book value of FNet at the time of the transaction. The
issuance of these shares caused the Company's ownership percentage of FNet to
decrease from 100% to 79% as of June 30, 1996.
During the year ended June 30, 1996, the Company deferred payment of
$117,000 in compensation, included in the table above, to its CEO, Frank W.
Peters, with his permission, for an undetermined time period.
On September 20, 1995, the Company issued a promissory note for $100,000,
bearing interest at the rate of 8%, to its CEO, in lieu of bonus compensation,
included in the table above, for attaining certain corporate objectives. The
note is payable in twenty four equal monthly installments of $4,523. No payments
have been made to date on this Note, and the President has waived the default
provisions.
On September 20, 1996, the Company issued a $100,000 promissory note to its
CEO in exchange for services rendered in fiscal 1997. No compensation expense
was recorded in fiscal 1996 relating to this note. Bonus compensation expense of
$100,000 will be recorded in connection therewith in fiscal 1997. The note bears
interest at 8% per annum, and is payable in thirty-six equal monthly
installments of $3,134.
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<PAGE> 8
On December 13, 1996, the Company granted an option to purchase 1,000,000
shares of its Common Stock at an exercise price of $1.31 per share, the market
price as of December 13, 1996. The options were granted to key management
employees for achievement of certain goals. The options are all currently
exercisable. Of the options, 500,000 were granted to the Company's CEO, Frank W.
Peters, and 100,000 were granted to its Chief Financial Officer, Thomas Russell.
During the year ended June 30, 1997, the Company deferred payment of
$112,000 in compensation, included in the table above, to its CEO, with his
permission, for an undetermined time period.
As of June 30, 1997, the deferred compensation of $117,000 and $112,000 was
converted into two promissory notes. One half of the principal balance of the
notes is convertible into shares of the Company's Common Stock at a conversion
rate of 50% of the fair market value of the Common Stock at the date of
conversion.
On October 7, 1997, the Company's CEO exercised an option to convert a note
for $133,000 into 1,333,695 shares of the Company's Common stock at the exercise
price of $.10 per share.
On October 14, 1997, the Company's CEO exercised an option to purchase
300,000 shares of the Company's Common stock at the exercise price of $.10 per
share.
On November 3, 1997, the Company's Chief Financial Officer exercised
options to purchase 150,000 shares of the Company's Common stock at exercise
prices ranging from $.69 to $1.31.
On May 11, 1998, the Company's Chief Financial Officer exercised options to
purchase 100,000 shares of the Company's Common stock at an exercise price of
$.69 per share.
As of June 30, 1998, the deferred compensation of $129,000 for the CEO was
converted into a promissory note. One half of the principal balance of the note
is convertible into shares of the Company's Common Stock at a conversion rate of
50% of the fair market value of the Common Stock at the date of conversion.
As of December 31, 1998, the CEO converted all outstanding promissory notes
owed to him by the Company into one non-interest bearing note. All previous
provisions to convert amounts owed into stock and security interest in the
Company's assets were eliminated.
COMPENSATION COMMITTEE REPORT
Report on Annual Compensation of Executive Officers
It is the policy of the Company's Compensation Committee to establish
compensation levels for the executive officers, which reflect the Company's
overall performance and their performance, responsibilities and contributions to
the long-term growth and profitability of the Company. The committee determines
compensation based on its evaluation of the Company's overall performance,
including various quantitative factors, primarily the Company's financial
performance, sales and earnings against the Company's operating plan, as well as
various qualitative factors such as new product development, the Company's
product and service quality, the extent to which the executive officers have
contributed to forming a strong management team and other factors which the
committee believes are indicative of the Company's ongoing ability to achieve
its long-term growth and profit objectives.
The principal component of the compensation of the executive officers is
their base salaries. The committee also retains the discretion to award bonuses
based on corporate or individual performance. The committee evaluates the
practices of various industry groups, market data, including data obtained from
time to time from outside compensation consultants, and other economic
information to determine the appropriate ranges of base salary levels which will
enable the Company to retain and incentivize the executive officers. Throughout
the year, the committee members review the
7
<PAGE> 9
corporate and individual performance factors described above. The committee,
based upon its review of performance for the previous year and its review of the
Company's operating plan, establishes salary levels and awards any bonuses to
the executive officers.
The Compensation Committee also considers grants of stock options for the
Company's key employees, including executive officers. The purpose of the stock
option program is to provide incentives to the Company's management to work to
maximize shareholder value. The option program also utilizes vesting periods to
encourage key employees to continue in the employ of the Company. Individual
amounts of annual stock option grants are derived based upon review of
competitive compensation practices with respect to the same or similar executive
positions, overall corporate performance and individual performance.
8
<PAGE> 10
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934, as amended (the
'Exchange Act"), requires the Company's officers and Directors, and persons who
own more than ten percent of a registered class of the Company's equity
securities, to file reports of ownership an changes in ownership (Forms 3, 4 and
5) with the Securities and Exchange Commission. Officers, directors and
greater-than-ten-percent shareholders are required to furnish the Company with
copies of all such forms which they file.
To the Company's knowledge, based solely on the Company's review of such
reports or written representations from certain reporting persons that no Forms
5 were required to be filed by those persons, the Company believes that during
the year ended December 31, 1998 filing requirements applicable to its officers,
directors, and other persons subject to Section 16 of the Exchange Act were in
compliance, except that Forms 4 were not filed for sales of securities.
INDEPENDENT ACCOUNTANTS
Singer Lewak Greenbaum & Goldstein LLP has been retained to serve as the
Company's independent certified public accountants for the fiscal year ending
June 30, 1998. A representative of Singer Lewak Greenbaum & Goldstein LLP is
expected to be present at the Annual Meeting, and to be available to respond to
any shareholder questions directed to Singer Lewak Greenbaum & Goldstein LLP.
This representative will have an opportunity to make a statement if Singer Lewak
Greenbaum & Goldstein LLP so desires.
SHAREHOLDER PROPOSALS
In order to be considered for inclusion in the Company's proxy statement
and form of proxy relating to the Company's next annual meeting of shareholders,
proposals by the Company's shareholders intended to be presented at such annual
meeting must be received by the Company no later than ninety (90) days prior to
January 29, 2000.
ANNUAL REPORTS
The Company's 1998 Annual Report, which includes audited financial
statements for the Company's fiscal year ended June 30, 1998, is concurrently
being mailed with this proxy statement to shareholders of record on May 3, 1999.
OTHER MATTERS
The Board of Directors knows of no other matters to be presented for action
at the meeting. However, if any matters not included in this Proxy Statement
properly come before the meeting, it is the intention of the persons named in
the enclosed proxy to vote under the authority therein given in accordance with
his or their best judgment.
By Order of the Board of Directors,
Frank W. Peters , Chief Executive Officer
May 17,1999
9
<PAGE> 11
PLEASE MARK
[X] VOTES AS IN
THIS EXAMPLE
REVOCABLE PROXY
FRANKLIN TELECOMMUNICATIONS CORP.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ANNUAL MEETING OF SHAREHOLDERS
JUNE 18, 1999
The undersigned hereby appoints Frank W. Peters and Thomas Russell, and
each of them as attorney-in-fact and proxy for the undersigned, with full power
of substitution, to represent the undersigned and vote, as designated below,
all of the shares of Common Stock of Franklin Telecommunications Corp. (the
"Company") which the undersigned is entitled to vote at the Company's Annual
Meeting of Shareholders to be held on June 18, 1999, or at any adjournment or
continuation thereof.
1. ELECTION OF DIRECTORS: for all nominees listed below (except as marked
to the contrary below):
For Withhold For All Except
[ ] [ ] [ ]
Frank W. Peters, Peter S. Buswell, Robert S. Harp,
Thomas Russell and Herb Mitchell
INSTRUCTION: To withhold authority to vote for any individual nominee, mark
"For All Except" and write that nominee's name in the space provided below.
- -----------------------------------------------------------------------------
2. To amend the Articles of incorporation to change the name of the Company
to FTEL.COM
For Against Abstain
[ ] [ ] [ ]
3. In their discretion, upon such other business as may properly come before
the Annual Meeting or any adjournment or continuation thereof.
<PAGE> 12
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER HEREIN
SPECIFIED BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS INDICATED, THIS
PROXY WILL BE VOTED FOR THE ELECTION OF EACH OF THE NOMINEES LISTED ABOVE TO
THE COMPANY'S BOARD OF DIRECTORS, AND IN ACCORDANCE WITH THE DISCRETION OF THE
PROXIES ON ANY OTHER MATTERS TO COME BEFORE THE ANNUAL MEETING.
Please sign exactly as your name appears on this card, date and return
this card promptly using the enclosed envelope. Executors, administrators,
guardians, officers of corporations, and other signing in a fiduciary capacity
should state their full title as such.
Please be sure to sign and date this Proxy in the box below.
Date
____________________
___________________________ _____________________________
Shareholder sign above Co-holder (if any) sign above
- --------------------------------------------------------------------------------
Detach above card, sign, date and mail in postage paid envelope provided.
FRANKLIN TELECOMMUNICATIONS CORP.
WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE ACT PROMPTLY
SIGN, DATE & MAIL YOUR PROXY CARD TODAY, USING THE ENCLOSED ENVELOPE.
