NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The Annual Meeting of Stockholders of TV
Communications Network, Inc. (The "Company") will be
held at the TVCN Building, 10020 East Girard Avenue,
Suite 301, Denver, Colorado, 80231, on Tuesday, October
16, 1997 at 10:00 a.m. MDT time for the following
purposes:
(1) To elect the following three (3) Directors:
Omar A. Duwaik
Armand DePizzol
Dennis J. Horner
(2) To ratify management's decision to issue
17,953,321 shares of TVCN restricted common stock in
exchange for all the issued and outstanding stock of
MDA of Georgia, Inc.
(3) To ratify management's decision to sell the
Rome, Georgia Four Channel E-Group MMDS License to
BellSouth Wireless Cable, Inc. for Two Million Dollars
($2,000,000.00) in cash.
(4) To ratify the Management decision to retain the
services of the auditing firm of Ehrhardt, Keefe,
Steiner & Hottman, P.C.
Proxy material will be mailed on or about September 24,
1997. The date of record is September 22, 1997.
Stockholders of record at the close of business on
September 22, 1997 will be entitled to notice of and to
vote at the meeting. The stock transfer books of the
Company will remain open.
By order of the Board of Directors,
Dennis J. Horner, Secretary
September 22, 1997
Denver, Colorado
IMPORTANT
IT IS IMPORTANT THAT YOUR SHARES ARE REPRESENTED AT THE
ANNUAL MEETING, ACCORDINGLY, YOU ARE URGED TO COMPLETE,
SIGN, DATE AND PROMPTLY RETURN YOUR PROXY IN THE
ENCLOSED ENVELOPE. IF YOU SO CHOOSE, YOU MAY VOTE YOUR
SHARES IN PERSON AT THE ANNUAL MEETING.
THIS REPORT DOES NOT PURPORT THAT THE SECURITIES AND
EXCHANGE COMMISSION ("SEC") HAS APPROVED OR DISAPPROVED
ANY OF THIS REPORT OR PASSED UPON ITS ACCURACY OR
ADEQUACY.
<PAGE>
TV COMMUNICATIONS NETWORK, INC.
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
October 16, 1997
VOTING SECURITIES, PRINCIPAL HOLDERS AND PROXIES
This Proxy Statement is being furnished in
connection with the solicitation of proxies by the
Board of Directors of TV Communications Network, Inc.
(The "Company" or "TVCN" or the "Registrant") for use
at the Annual Meeting of Shareholders to be held on
Thursday, October 16, 1997. All valid proxies received
prior to the meeting will be voted. All proxies will
be voted in accordance with the instructions contained
therein and, if no choice is specified, will be voted
for the election of each of the individuals nominated
by the Board of Directors and in favor of the other
proposals set forth in the Notice of Annual Meeting of
Shareholders. A shareholder who has given a proxy may
revoke it at any time prior to such proxy being voted
at the meeting by filing with the Secretary of the
Company an instrument revoking it or a duly executed
proxy bearing a later date, or by attending the meeting
and giving notice of such revocation. Attendance at
the meeting does not by itself constitute revocation of
a proxy.
The Board of Directors has fixed September 22,
1997 as the record date for the determination of
stockholders entitled to vote at the Annual Meeting.
Only shareholders of record as of the close of business
on September 22, 1997 (the "Record Date") will be
entitled to notice of and to vote at the Annual Meeting
of Shareholders or any adjournment thereof. Shares may
be voted at the meeting in person or by proxy. At the
Record Date, there were outstanding and entitled to
vote 41,188,454 shares of the Common Stock of the
Company. Each share is entitled to one vote. The
election of directors as well as the adoption of
Proposals 2 through 4 requires the affirmative vote of
the holders of a majority of the shares present at the
meeting in person or represented by proxy and entitled
to vote.
All costs of solicitation of proxies will be borne
by the Company. In addition to the use of the mails,
arrangements also may be made with brokerage firms and
other custodians, nominees and fiduciaries who hold the
voting securities of record for the forwarding of
solicitation material to the beneficial owners thereof.
The Company will reimburse such brokers, custodians,
nominees and fiduciaries for the reasonable out-of-
pocket expenses incurred by them in connection
therewith. The costs of the solicitation of proxies
will be between $15,000 and $20,000. The amounts being
spent include attorneys' fees, accountants' fees,
solicitors' time, printing costs, postage, and other
incidental expenses.
<PAGE>
VOTING SHARES AND PRINCIPAL SHAREHOLDERS
Shareholders of record as of the close of business
on September 22, 1997 (the "Record Date"), will be
entitled to notice of and to vote at the Annual
Meeting. As of the Record Date there were outstanding
41,188,454 issued shares of the Company's $0.0005 a
value common stock (hereinafter called "Common Stock"),
each of which is entitled to one vote on all matters
which may come before the meeting. Cumulative voting
is prohibited. The Company has no other class of
voting securities.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
The following table sets forth the number of
shares of the Company's common stock owned
beneficially, as of the Record Date, by Management and
by each person known by the Company to have owned
beneficially more than five percent of such shares then
outstanding:
Percentage of
Name and Address of Amount and Nature of Class
Beneficial Owner Beneficial Ownership Beneficially Owned
Omar Duwaik (1) 33,230,677/Common Stock 80.67%
12483 E. Cedar Crcl Sole Owner
Aurora, CO 80012
Armand DePizzol (1) None **
Dennis J. Horner (1) 1,000 **
Barry Arrington None **
All officers and
Directors as a group 33,231,677 80.68%
(Four in number)
Taher M. Aldweik* 950,233/Common Stock 5.29%
Hayy Al Hussein Sole Owner
Box 11368
Alzarka, Jordan
CEDE & Company 1,929,381/Common Stock 10.73%
Box 20 Depository Holder
Bowling Green Station
New York, NY 10004
Total as a Group 12,903,970 71.77%
(Six in number)
* Taher Aldweik is the brother of Omar A. Duwaik
(President).
** Less Than 1%
(1) These persons being those making the solicitation
of proxies by mail.
<PAGE>
PROPOSAL 1 - ELECTION OF DIRECTORS
The persons named in the enclosed proxy will vote
to elect as directors the persons identified below, as
nominees, for a one-year term expiring in 1998 unless
authority to vote for the election of directors is
withheld by marking the proxy to that effect.
In the event that any nominee for election should
become unavailable, the person acting under the proxy
may vote for the election of a substitute. Management
has no reason to believe that any nominee will become
unavailable. In the event this proposal is not passed,
then the Company will propose that the three previous
directors be re-elected. Other nominations may be made
by eligible shareholders. The three nominees with the
most votes will be elected directors.
The information about each director and his
beneficial ownership of shares of the Common Stock of
the Company as of the Record Date is as follows:
Beneficial Ownership
Nominees for Percent of
Director For Terms Principal Occupations No. of Outstanding
Expiring in 1996 During Past Five Years Shares Common Stock
Omar A. Duwaik Chairman of the Board, 33,230,677 80.67%
Director since Chief Executive Officer
1987 and President
Age 53
Dennis J. Horner Vice President of 1,000 0.01%
Age 50 Finance,Controller,
and Treasurer since
Feb. 1994
Controller for Ryan-Murphy,
Inc., BCS, Inc., and American
Medco
Armand DePizzol Director 0 0%
Director
Age 65
Omar Duwaik has been the President, CEO and
Director of TVCN since its inception on July 7, 1987.
Mr. Duwaik has been involved in the telecommunications,
aerospace and electronic industries for the past 25
years. In 1980, Mr. Duwaik joined Multichannel
Distribution of America ("MDA"), Inc. in Denver as its
president. In 1983, MDA submitted 413 MMDS
applications to the FCC, of which 71 were granted to
MDA, with no competition, and through a lottery
process, about forty more conditional licenses were
granted by the FCC. For MDA, Mr. Duwaik constructed
the first MMDS station in San Luis Obispo, California.
Under his direction, three more MMDS stations were
constructed in Kansas and Alabama. By 1994, TVCN had
ten of these wireless cable TV stations, of which three
were sold for about 17.5 million dollars. Mr. Duwaik
received a BS Degree in Electrical Engineering, and a
BS Degree in Computer Science and an MS Degree in
Electrical Engineering Communications from Oregon State
University in 1971. Mr. Duwaik owns 33,230,677 shares
of common stock. Mr. Duwaik is employed on a full time
basis with the Company and is compensated at the rate
of $108,000.00 a year.
Dennis J. Horner - Vice President of Finance,
Controller, Secretary and Treasurer. Mr. Horner joined
the Company in February, 1994. Mr. Horner received his
Bachelor of Science Degree in December, 1970, from
Metropolitan State College. Mr. Horner received his
Master of Business Administration Degree from the
University of Colorado in December, 1974. Mr. Horner
continued his education at the University of Colorado
from September, 1977, to June, 1980, majoring in
accounting. Mr. Horner became a Certified Public
Accountant in the State of Colorado in 1983. Mr.
Horner also studied at the Colorado School of Mines
from September, 1965, to June, 1968. Mr. Horner has
twenty-four years working experience. He has four
years as assistant controller and five years as
controller for Ryan-Murphy, Inc., BCS, Inc., and
American Medco. Mr. Horner is employed on a full-time
basis with the Company and is compensated at the rate
of $50,793 per year.
Armand L. DePizzol - President of Alert Systems
and CEO of National Direct Connect Corporation. Mr.
DePizzol holds an MA in Economics and a BS in Business
Administration. He was President of American
Technology & Information, Inc. ("AT&I") from 1984 -
1987 and was in charge of all operations for that
company. This was during the period when AT&I built
the very first wireless multichannel TV station in the
country. Prior to that, Mr. DePizzol spent seven years
overseas with the International Department of CitiBank
of New York. During this period he conducted extensive
credit and operational examinations of some thirty
foreign bank branches. Mr. DePizzol was also employed
by the Federal Reserve Bank. He was the first bank
examiner to uncover a major defalcation in the
international department of a foreign bank branch
located on the West Coast. He acted as a consultant to
the First of Denver Bank, currently First Interstate
Bank. Mr. DePizzol is also a financial advisor.
Recently, he directed the growth of a transportation
company from nine units to more than forty units within
a six month period. He has helped obtain financing for
several turn-around companies and he also holds various
patents.
Currently, the Company has no standing Audit,
Nominating or Compensation committees or committees
that perform similar functions, other than the Board of
Directors. The Board held two meetings during the last
fiscal year, and no director attended less than 75% of
the aggregate of those meetings, either in person or
telephonically.
<PAGE>
The Board of Directors Recommends a Vote FOR All
Nominees.
PROPOSAL 2 - TO RATIFY MANAGMENT'S DECISION TO ISSUE
17,953,321 SHARES OF TVCN RESTRICTED COMMON STOCK IN
EXCHANGE FOR ALL THE ISSUED AND OUTSTANDING STOCK OF
MDA OF GEORGIA, INC.
On June 17, 1997, The Company entered into an agreement
with MDA of Georgia, Inc. to issue 17,953,321 shares of
TVCN's restricted common shares in exchange for all of
the stock of MDA of Georgia, Inc. ( a wholly owned
subsidiary of MDA, Inc., a company related to TVCN by
having some common officers and directors.) The only
asset of MDA of Georgia, Inc. was a four-channel E-
Group MMDS license in Rome, Georgia. This license had a
four market value of about $2,000,000.00. The number of
shares to be issued in the transaction was derived by
averaging the high bid price of TVCN's stock at the
close on each of the previous four Fridays, which were
$0.14, $0.13, $0.15 and $0.15, as reported by the
National Quotation Bureau. The aveage of those high
bids was $0.1425 per share. Since the shares issued by
TVCn are restricted shares, and TVCN historically
discounted restricted shares by 20%, the discounted
average high bids of $0.1425 was discounted by 20% to
$0.114 per share. The $2.0 million was then divided by
$0.114. The resulting number was the number of shares
TVCN agreed to issue, i.e. 17,953,321 restricted
shares.
<PAGE>
The Board of Directors Recommends a Vote FOR this
Proposal.
PROPOSAL 3 - TO RATIFY MANAGEMENT'S DECISION TO SELL
THE ROME, GEORGIA FOUR CHANNEL E-GROUP MMDS LICENSE TO
BELL SOUTH WIRELESS CABLE, INC. FOR TWO MILLION DOLLARS
($2,000,000.00) IN CASH.
Pursuant to an agreement that had already been
negotiated MDA, Inc. and by MDA of Georgia, Inc.
("MDA") and BellSouth Wireless Cable, Inc., TVCN
authorized the management of MDA to honor agreement and
sell the Rome, Georgia four channel E-Group MMDS linces
and equipment of $2,000,000.00. The transaction was
finalized on June 18, 1997 and TVCN, by and through its
wholly owned subsidiary (MDA of Georgia, Inc.) received
$2 million in cash. Since the equipment was fully
depreciated, the entire $2,000,000.00 was booked as the
value of the license being sold.
The Board of Directors Recommends a Vote FOR this
Proposal.
PROPOSAL 4 - RETAINING THE INDEPENDENT AUDITING FIRM
On March 31, 1996, the Company signed an
engagement letter with the auditing firm of Ehrhardt,
Keefe, Steiner & Hottman, PC of 7979 East Tufts Avenue,
Suite 400, Denver, Colorado 80237 (EKSH or "Auditor")
(Telephone Number: (303) 740-9400; Fax Number: (303)
740-9009). The agreement letter was signed by the
Auditor after meetings with the Company's President and
the Controller. The Auditor agreed to audit the
Company's financial records for fiscal year ended March
31, 1997, The Auditor also agreed to assist the Company
in the preparation of the Company's Annual Report on
Form 10-KSB. The Company agreed to abide by the
Auditor's recommendations. The Board has again
selected EKSH as TVCN's auditors for the fiscal year
ending March 31, 1998 and recommends that the
shareholders ratify and approve the selection.
The Board of Directors Recommends a Vote FOR this
Proposal.
During the Company's last fiscal year and the
interim periods there were no disagreements with the
accountants on any matter of accounting principles or
practices, financial statement disclosure, or auditing
scope or procedure. In the event this proposal is not
passed, the Company will fulfill its present
contractual obligations with the present firm and seek
a new independent auditing firm for the next fiscal
year.
COMPENSATION PLAN
Incentive Stock Option Plan:
Effective July 14, 1987, the Company adopted an
incentive Stock Option Plan for Company executives and
key employees. The Company has reserved 2,000,000
(post 5 to 1 reverse split) common shares for issuance
pursuant to the plan. The plan provides that no option
may be granted at an exercise price less than the fair
market value of the common shares of the Company on the
date of grant. To date, no options have been granted
pursuant to the plan. Under current terms, the plan
will terminate in 1997.
OTHER COMPENSATION BENEFITS
The Company currently has no Directors or
Executive Officers who receive cash compensation in an
amount over $60,000, except the Company's President,
Omar A. Duwaik and Vice-President and General Counsel,
Barry Arrington. The Company offers a health benefits
package to all employees, but currently has no
retirement plan. The costs for the health benefit
package (medical insurance) are paid by the eligible
enrollees.
No option/Stock Appreciation Rights ("SAR")
Grants were awarded during the Last Fiscal Year. No
Aggregated option SAR Exercises were awarded during
Last Fiscal Year. Therefore, Fiscal Year End
Option/SAR Values and long-term Incentive Plan Award
Tables have been omitted.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANT
On March 31, 1997, the Company signed an
engagement letter with the auditing firm of Ehrhardt,
Keefe, Steiner, & Hottman, PC of 7979 East Tufts
Avenue, Suite 400, Denver, Colorado 80237 (EKSH or
"Auditor") (Telephone Number: (303) 740-9400; Fax
Number: (303) 740-9009.) EKSH also audited the
Company's financial records for fiscal years ended
March 31, 1993, 1994, 1995 and 1996
and restated the Company's financial records for 1992.
The Auditor agreed to audit the Company's financial
records for fiscal year 1997 and assist the Company in
the preparation of the Company's Annual Report on Form
10-KSB.
A representative(s) of EKSH will be available at
the Annual Meeting to respond to any questions and make
a statement.
The principal accountants' report on the financial
statements of the fiscal year 1997 contained no adverse
opinions, nor a disclaimer of opinion, nor was
qualified as to uncertainty, audit scope, or accounting
principles.
<PAGE>
OTHER BUSINESS AT THE NEXT ANNUAL MEETING OF
SHAREHOLDERS
Any shareholder of record of the Company who desires to
submit a proper proposal for inclusion in the Proxy
materials relating to the next Annual Meeting of
Shareholders must do so in writing and according to the
Company By-Laws. Pursuant to the By-Laws of the
Company, for any matter (other than proposals made by
Management) to be properly brought before the 1998
Annual Meeting of Shareholders by a Shareholder, the
other matter must be a proper subject for stockholder
action. The stockholder proposing to bring such other
matter must be entitled to vote at the 1998 Annual
Meeting of Shareholders and must deliver written notice
describing such other matter, which written notice must
be received by the Secretary of the Company, at the
Company's principal office in Denver, Colorado on or
before March 31, 1998.
ANNUAL REPORT
The financial audit of the Company has been completed
and is incorporated herein by reference.
The Form 10-KSB has been included as a part of the
Company's Annual Report which is enclosed in this
mailing.
AVAILABILITY OF ANNUAL REPORT ON FORM 10-KSB
UPON WRITTEN REQUEST, THE COMPANY WILL PROVIDE, WITHOUT
A CHARGE, A COPY OF ITS ANNUAL REPORT ON FORM 10-KSB
FOR THE FISCAL YEAR ENDED MARCH 31, 1997, TO EACH
SHAREHOLDER OF RECORD OR TO EACH SHAREHOLDER WHO OWNED
COMMON STOCK OF THE COMPANY LISTED IN THE NAME OF BANK
OR BROKER, AS NOMINEE, AT THE CLOSE OF BUSINESS ON
September 22, 1997. ANY REQUEST BY A SHAREHOLDER FOR
THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB SHOULD BE
MAILED TO THE COMPANY'S SECRETARY, TV COMMUNICATIONS
NETWORK, INC., 10020 EAST GIRARD AVENUE, SUITE 300,
DENVER, CO 80231.
The above Notice of Annual Meeting of Shareholders and
Proxy Statement are sent by order of the Board of
Directors.
Dennis J. Horner, Secretary
Denver, Colorado
September 24, 1997
<PAGE>
TV COMMUNICATIONS NETWORK, INC.
Proxy Solicited on Behalf of the Board of Directors for
its Annual Meeting of Shareholders
The undersigned hereby appoint Omar A. Duwaik, Armand
DePizzol, and Dennis J. Horner, or any of them, with
the power of substitution, as proxies to vote all
shares of the Common Stock of the Company owned by the
undersigned at the Annual meeting of the Stockholders
to be held at 10020 East Girard Avenue, Suite 301,
Denver, Colorado 80231, on October 16, 1997, or to any
adjournment thereof, on such business as may properly
come before the meeting, including the following items
as set forth in the Notice of Annual Meeting of
Stockholders and Proxy Statement:
(1) To elect the following three (3) Directors:
Omar A. Duwaik _ For _ Against _Abstain
Armand DePizzol _ For _ Against _Abstain
Dennis J. Horner _ For _ Against _Abstain
(2) To ratify management's decision to issue
17,953,321 shares of TVCN restricted common stock in
exchange for all the issued and outstanding shares of
MDA of Georgia, Inc.
_ For _ Against _Abstain
(3) To ratify management's decision to sell the Rome,
Georgia Four Channel E-Group MMDS License to BellSouth
Wireless Cable, Inc. for Two Million Dollars
($2,000,000.00) in cash.
_ For _ Against _Abstain
(4) To ratify the Management decision to engage the
services of the auditing firm of Ehrhardt, Keefe,
Steiner & Hottman, P.C.
_ For _ Against _Abstain
<PAGE>
Please date, sign, and mail in the enclosed envelope.
This proxy, when properly executed, will be voted in
the manner directed by the undersigned stockholder. If
no direction is made, this proxy will be voted for
proposals 1 through 4. It is revocable at any time
before it is exercised.
Number of shares: _____________ Date: _________________
Please Print
Signature: ______________ Name & Title: __________________
Please Print
Signature: ______________ Name & Title: __________________
Address:
_______________________________________________________________
_______________________________________________________________
Instructions: Where there is more than one owner, each
should sign. When signing as an attorney,
administrator, executor, guardian, or trustee, please
add your title as such. If executed by a corporation,
the proxy should be signed by a duly authorized
officer.
