FRONTEER DIRECTORY COMPANY INC, PRE 14A, 1996-04-05

FRONTEER DIRECTORY COMPANY INC
PRE 14A, 1996-04-05
MISCELLANEOUS PUBLISHING

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FRONTEER DIRECTORY COMPANY, INC. ANNUAL MEETING
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

Filed by the Registrant [X]

FILED BY THE PARTY OTHER THAN THE REGISTRANT [ ]

Check the appropriate box:
[X] Preliminary Proxy Statement [ ] Confidential for use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12

FRONTEER DIRECTORY COMPANY, INC.
(Name of Registrant as Specified in its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3).
[ ] 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 the 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:

<PAGE>

PRELIMINARY COPY

FRONTEER DIRECTORY COMPANY, INC.
One Norwest Center
1700 Lincoln Street, 32nd Floor
Denver, Colorado 80203

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To be held on May 3, 1996

NOTICE IS HEREBY GIVEN that an Annual Meeting of Stockholders (the
"Meeting") of Fronteer Directory Company, Inc., a Colorado corporation (the
"Company"), will be held at the Holiday Inn, Sixth and Broadway, Bismarck, North
Dakota, on May 3, 1996, at 4:00 p.m., Central Standard Time, for the purpose of
considering and voting upon proposals to:

(1) Elect a Board of Directors to serve until the next Annual Meeting of
Stockholders;

(2) Amend the Company's Articles of Incorporation to change the name of
the Company;

(3) Adopt the 1996 Incentive and Nonstatutory Stock Option Plan for the
benefit of eligible employees and consultants of the Company; and

(4) Transact such other business as may lawfully come before the Meeting.

Only stockholders of record at the close of business on March 11, 1996, are
entitled to notice of and to vote at the Meeting, and at any adjournment
thereof. A list of the shareholders entitled to vote at the Meeting will be kept
at the Company's offices located at 216 North 23rd Street, Bismarck, North
Dakota, 58501 and will be available for inspection on written demand by any
shareholder or his agent or attorney during regular business hours and during
the period available for inspection as set forth in the Company's bylaws.

The enclosed Proxy is solicited by and on behalf of the Board of Directors of
the Company. All stockholders are cordially invited to attend the Meeting in
person. Whether you plan to attend or not, please date, sign and return the
accompanying proxy in the enclosed return envelope, to which no postage need be
affixed if mailed in the United States. The giving of a proxy will not affect
your right to vote in person if you attend the Meeting.

BY ORDER OF THE BOARD OF DIRECTORS

Robert L. Long, Secretary

Denver, Colorado
April ____, 1996

<PAGE>

PRELIMINARY COPY

FRONTEER DIRECTORY COMPANY, INC.
One Norwest Center
1700 Lincoln Street, 32nd Floor
Denver, Colorado 80203

PROXY STATEMENT
ANNUAL MEETING OF COMMON STOCKHOLDERS
TO BE HELD ON MAY 3, 1996

This proxy statement is being furnished in connection with the solicitation
of proxies by the Board of Directors ( the "Board") of Fronteer Directory
Company, Inc. (the "Company") to be used at the Annual Meeting of Stockholders
(the "Meeting") to be held at the Holiday Inn, Sixth and Broadway, Bismarck,
North Dakota, on May 3, 1996, at 4:00 p.m., Central Standard Time, and at any
adjournment thereof.

It is planned that this Proxy Statement and the accompanying Proxy will be
mailed to the Company's stockholders on or about April 15, 1996.

Any person signing and mailing the enclosed Proxy may revoke it at any time
before it is voted by (i) giving written notice of the revocation to the
Company's corporate secretary; (ii) voting in person at the Meeting; or (iii)
voting again by submitting a new proxy card. Only the latest dated proxy card,
including one which a person may vote in person at the Meeting, will count.

VOTING SECURITIES AND PRINCIPAL STOCKHOLDERS
AND SECURITY OWNERSHIP OF MANAGEMENT

Voting rights are vested in the holders of the Company's $0.01 par value
common stock ("Common Stock") with each share entitled to one vote. Holders of
the Company's Series A Voting Cumulative Convertible Preferred Stock ("Preferred
Stock") are also entitled to vote at the Meeting, with each share entitled to
one vote. Cumulative voting in the election of directors is not permitted. Only
stockholders of record at the close of business on March 11, 1996, are entitled
to notice of and to vote at the Meeting or any adjournments thereof. On March
11, 1996, the Company had 12,558,061 shares of Common Stock outstanding and
87,500 shares of Preferred Stock outstanding.

The following table sets forth as of April 4, 1996, the number of shares of
the Company's outstanding Common Stock and Preferred Stock beneficially owned by
each of the Company's current directors and officers, sets forth the number of
shares of the Company's Common Stock and Preferred Stock beneficially owned by
all of the Company's current directors and officers as a group and sets forth
the number of shares of the Company's Common Stock and Preferred Stock owned by
each person who owned of record, or was known to own beneficially, more than 5%
of the Company's outstanding shares of Common Stock and Preferred Stock
respectively:

Amount and Nature
of Beneficial Percent of
Name and Address of Ownership (1) Class
Beneficial Owner or -------------------------- ----------------
Officer or Director Common Preferred Common Preferred
- ------------------- ----------- --------- ------ ---------

R. A. Fitzner, Jr .......... 5,465,793(2) 7,500(3) 43.9% 8.6%
1700 Lincoln Street
32nd Floor
Denver, CO 80202

Dennis W. Olson ............ 683,814(4) 0 5.5% 0
216 North 23rd Street
Bismarck, ND 58501

Robert L. Long ............. 603,125(5) 0 4.8% 0

All officers and directors . 6,752,732(6) 7,500 54.2% 8.6%
as a group (3 persons)

- ------------------
</TABLE>

(1) Each person has the sole voting and investment power over the shares
indicated.

(2) Includes 881,088 shares over which Mr. Fitzner has voting power pursuant to
four Voting Agreements and Irrevocable Proxies dated June 2, 1995, one each
between Mr. Fitzner and Dorothy K. Englebrecht, Steven Fishbein, Peter
O'Leary and Arlene Wilson. The irrevocable proxies expire on July 16, 1997
and the voting trust agreements expire on September 15, 1997. See the
Company's Annual Report on Form 10-K/A ("Form 10-K/A") attached to the
Annual Report to Stockholders enclosed herewith, "Business -- Acquisition
of RAFCO." Also includes 4,584,705 shares of which Mr. Fitzner has sole
power to dispose or direct the disposition.

(3) Includes 2,500 shares of Preferred Stock owned by Earlene E. Fitzner, Mr.
Fitzner's mother, over which shares Mr. Fitzner has sole voting power and
of which shares Mr. Fitzner has sole power to dispose or to direct the
disposition.

(4) Includes 100,000 shares of Common Stock underlying a stock option, 6,487
shares held in the Company's ESOP Plan and 2,108 shares held in the
Company's 401(k) Plan.

(5) Includes 78,125 underwriter's warrants held by Mr. Long.

(6) Includes shares underlying the stock options held by Mr. Olson.

DIRECTORS AND EXECUTIVE OFFICERS

Identification of Directors. The present term of office of each director
will expire at the next annual meeting of shareholders and when his successor
has been elected and qualified. The name, position with the Company, age of each
director and the period during which each director has served are as follows:

Name and Position in the Company Age Director Since
- -------------------------------- --- --------------

R. A. Fitzner, Jr ................... 50 1995
Chairman of the Board and Director

Dennis W. Olson ..................... 55 1977
President and Director

Robert L. Long ...................... 62 1995
Secretary and Director
</TABLE>

Under the terms of the Plan of Reorganization and Exchange Agreement signed
by the Company on April 26, 1995 ("RAFCO Agreement") with RAFCO, Ltd., a Nevada
corporation ("RAFCO") whereby the Company acquired all of the assets of RAFCO in
exchange for which the Company assumed some of RAFCO's liabilities and issued
some stock to RAFCO, (see Form 10-K/A, "Business -- Acquisition of RAFCO") six
of the seven members of the Board of Directors of the Company agreed to resign
within 15 days after the date the RAFCO Agreement was signed and Dennis W.
Olson, the seventh member of the Board, agreed to accept the resignations of the
other six members and to appoint R. A. Fitzner, Jr. and Robert L. Long as
directors to fill two of the vacancies created by such resignations. Effective
May 23, 1995, the resignations agreed to in the RAFCO Agreement were accepted,
Messrs. Fitzner and Long were appointed as directors of the Company to fill two
of the vacancies, and the size of the board of directors was set at three
members. Other than the foregoing, there was no arrangement or understanding
between any director or any other person pursuant to which any director was
selected as such.

The Company's Board of Directors held 12 meetings during fiscal year 1995,
five of which consisted of consent directors minutes signed by all directors and
seven of which were actual meetings at which directors were present in person or
by telephone. The Board of Directors has no committees.

Identification of Executive Officers. Each executive officer will hold
office until his successor duly is elected and qualified, until his death,
resignation or until he shall be removed in the manner provided by the Company's
Bylaws. The Company's executive officers, their ages, positions with the Company
and periods during which they served are as follows:

Name of Executive Officer and Position in Company Age Officer Since
- ------------------------------------------------- --- -------------

R. A. Fitzner, Jr................................. 50 1996*
Chairman of the Board

Dennis W. Olson.................................. 55 1977
President of the Company

Robert L. Long................................... 62 1996*
Secretary
</TABLE>

*Mr. Fitzner has been the President of RAF Financial Corporation, a subsidiary
of the Company ("RAF"), since 1984 and Mr. Long has been the Senior Vice
President of RAF since 1990.

There was no arrangement or understanding between any executive officer and
any other person pursuant to which any person was selected as an executive
officer.

Compliance With Section 16(a) of the Securities Exchange Act of 1934. To
the Company's knowledge, during the Company's fiscal year ended September 30,
1995, the only directors, officers or more than 10% shareholders of the Company
that failed to timely file a Form 3, Form 4 or Form 5 were Dennis W. Olson,
Marlow Lindblom, Roland Haux and Larry Scott, each of whom filed late Forms 5
reporting the following number of transactions involving stock ownership which
was the result of participation in the Company's ESOP and 401(k) retirement

<PAGE>

plans: Dennis W. Olson: nine transactions reported on five Forms 5; Marlow E.
Lindblom: nine transactions reported on five Forms 5; Larry Scott: nine
transactions reported on five Forms 5; and Roland Haux: four transactions
reported on three Forms 5.

Executive Compensation. The following table provides certain information
pertaining to the compensation paid by the Company and its subsidiaries for
services rendered by Dennis W. Olson, the President of the Company, R. A.
Fitzner, Jr., the President of RAF, and Robert L. Long, the senior vice
president of RAF. RAF became a subsidiary of the Company in April of 1995.

SUMMARY COMPENSATION TABLE

Long Term
Compensation
Annual Compensation Awards
------------------------------------------- ------------
Year Other
Ended Annual Securities All Other
Name and Septem- Compen- Underlying Compensa-
Principal Position ber 30, Salary($) Bonus($) sation($) Options(#) tion($)
- ------------------ ------- -------- -------- -------- --------- ---------

Dennis W. Olson ........................ 1995 120,193(a) 10,000 (b) 0 100,000
President of the ...................... 1994 125,960 0 (b) 0 1,543
Company ............................... 1993 94,275 0 (b) 100,000 1,116

R. A. Fitzner, Jr ...................... 1995 132,000 40,000 573 0 0
President of RAF ...................... 1994 137,500 40,000 301 0 0
1993 132,000 40,000 108 0 0

Robert L. Long, ........................ 1995 320,500(c) 0 (d) 0 0
Senior Vice ........................... 1994 453,551(c) 0 (d) 0 0
President of RAF ...................... 1993 359,596(c) 0 (d) 0 0

- ---------------------
</TABLE>

(a) See "Employment Contracts and Termination of Employment and Change In
Control Arrangements" below for a description of Mr. Olson's employment
contract with the Company.

(b) The Company provided Mr. Olson with the use of an automobile during fiscal
years 1993, 1994 and 1995, and paid a club membership during fiscal years
1993 and 1994, however, these benefits did not exceed 10% of his aggregate
cash compensation for the years indicated. Mr. Olson participates in
Company sponsored employee insurance programs on the same terms as other
employees.

(d) Mr. Long's compensation for each of the fiscal years shown does not include
warrants received as compensation from RAF. Such warrants do not have value
unless and until they are exercised or sold.

Effective September 30, 1988, the Company adopted an Incentive Stock Option
Plan ("Plan"). The purpose of the Plan is to secure and retain key employees of
the Company. The Plan authorizes the granting of options to officers, directors,
and employees of the Company to purchase 600,000 shares of the Company's Common
Stock subject to adjustment for various forms of recapitalization that may
occur. Under the Plan, no options may be granted after September 30, 1998, and
the fair value of options granted to each optionee cannot exceed $100,000 per
year.

An employee must have six months of continuous employment with the Company
before he or she may exercise an option granted under the Plan. Options under
the Plan may not be granted at less than fair market value at the date of the
grant. Options granted under the Plan are nonassignable and terminate three
months after the

<PAGE>

optionee's employment ceases, except in the case of employment termination due
to disability of the optionee, in which event the option expires twelve months
from the date employment ceases. The Plan is administered by a committee
selected by the Company's Board of Directors.

Effective December 12, 1988, the Company granted options under the Plan to
37 individuals, which included 32 employees, the Company's three officers, and
two outside directors, for each such individual to purchase 4,000 shares at $.70
per share through December 12, 1993. Such grants involved an aggregate of
148,000 shares. Employees hired after December 12, 1988, and with the Company
for six consecutive months, were each granted options to purchase 4,000 shares
of the Company's stock at the closing price on the date of the grant, limited to
a floor of $.70 per share. At September 30, 1995, options to purchase 43,000
shares under the Plan had been exercised and other options previously granted to
purchase 342,000 shares had expired. Currently there are no options outstanding
and 557,000 shares remain in the Plan.

OPTION GRANTS IN LAST FISCAL YEAR

No options were granted by the Company to R. A. Fitzner, Jr., Dennis W.
Olson or Robert L. Long during the Company's fiscal year ended September 30,
1995.

AGGREGATED OPTION EXERCISES
IN LAST FISCAL YEAR AND FISCAL YEAR
END OPTION VALUES

The following table sets forth information with respect to Dennis W. Olson
and Robert L. Long concerning the exercise of options and underwriter's warrants
during the Company's last fiscal year ended September 30, 1995, and unexercised
options and warrants held as of September 30, 1995. R. A. Fitzner, Jr. does not
own any options or warrants to purchase securities of the Company.

<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of In-the-Money
Options at Options at
September 30, 1995(#) September 30, 1995($)(1)
Shares Acquired Value ----------------------------- ----------------------------
Name on Exercise(#) Realized($) Exercisable/ Unexercisable Exercisable/ Unexercisable
- ---- ---------------- ----------- ----------- ------------- ----------- -------------

Dennis W. Olson ................... - 0 - - 0 - 100,000 - 0 - - 0 - - 0 -

Robert L. Long .................... - 0 - - 0 - 78,125 - 0 - - 0 - - 0 -

- ------------------------
</TABLE>

(1) Value of unexercised in-the-money options or warrants is the market price
of the underlying shares of Common Stock at September 30, 1995, less the
exercise price of the options or warrants.

Compensation of Directors--Standard Arrangement.

Prior to the change in the members of the Board of Directors in May of
1995, directors of the Company who were not employees or officers received
$1,000 per quarter.

Long Term Incentive Plans - Awards in Last Fiscal Year.

During the year ended September 30, 1995, the executive officers of the
Company earned or were awarded shares pursuant to the Company's Employee Stock
Ownership Plan and the Company's 401(k) Plan as follows:

Number of
Shares of
the Company's
Name Common Stock
- ------------------------------------------- ------------------------

Dennis W. Olson ........................... 1,482(1) 642(2)

R. A. Fitzner, Jr ......................... 0(1) 0(2)

Robert L. Long ............................ 0(1) 0(2)

- -----------------

</TABLE>

(1) Pursuant to Employee Stock Ownership Plan. See discussion below with
respect to vesting of shares of Common Stock pursuant to the ESOP Plan.

(2) Pursuant to 401(k) Plan. See discussion below with respect to vesting of
shares of Common Stock contributed to the 401(k) Plan.

On September 22, 1989, the Company's Board of Directors adopted an Employee
Stock Ownership Plan ("ESOP Plan") which provides in pertinent part that the
Company may annually contribute tax deductible funds to the ESOP Plan, at its
discretion, which are then allocated to the Company's employees based upon the
employees' wages in relation to the total wages of all employees in the ESOP
Plan.

The ESOP Plan provides that more than half of the assets in the ESOP Plan
must consist of the Company's Common Stock. The ESOP Plan is administered by a
board of trustees under the supervision of an advisory committee, both of which
are appointed by the Company's board of directors. At September 30,1995, the
ESOP Plan owned 493,900 shares of the Company's Common Stock and no other
marketable securities. The ESOP Plan also had an outstanding bank loan of
$350,000, which was secured by the stock in the ESOP Plan and was guaranteed by
the Company. Employees become vested in the shares of the Company's Common Stock
after six years in the ESOP Plan. Executive officers participate in the ESOP
Plan in the same manner as other employees. Employees are 20% vested after two
years, vesting an additional 20% each year up to 100% after six years in the
ESOP Plan.

On April 1, 1991, the Company initiated a 401(k) plan, which provides in
pertinent part that the Company's employees may deduct money from their
paychecks on a pretax basis, which is invested into any of six investment
choices provided by the 401(k) Plan. Taxes on funds invested in the 401(k) Plan
are deferred until the money is drawn out, usually at retirement. All employees
as of April 1, 1991, were eligible for the 401(k) Plan and new employees after
that date become eligible for the 401(k) Plan on the April 1 or October 1
immediately following the completion of one year of employment. As an incentive,
the Company provides a matching contribution of shares of the Company's Common
Stock at the end of the year. This matching goes to all employees who are with
the Company on September 30 and is a dollar for dollar matching up to the first
$312. Employees become vested in this matching at the rate of 20% per year,
commencing two years after employment begins, and they are 100% vested after six
years with the Company. At September 30, 1995, 254,800 shares of the Company's
Common Stock had been purchased by the 401(k) Plan. Officers participate in the
Plan in the same manner as other employees.

The Company has no other bonus, profit sharing, pension, retirement, stock
purchase, deferred compensation, or other incentive plans, but the shareholders
are being asked to approve a new incentive stock option plan at the Meeting. See
"Actions to be Taken at Meeting" below.

6
<PAGE>

Employment Contracts and Termination of Employment and Change-In-Control
Arrangements.

There is no employment contract between the Company or RAF and R. A.
Fitzner, Jr. However, Robert L. Long and RAF have an oral agreement whereby Mr.
Long receives commissions based on a percentage of the dollar amount of his
clients' transactions and the dollar amount of all RAF corporate finance
transactions and he receives one half of all warrants received by RAF as
compensation for corporate finance transactions.

Legally effective as of January 1, 1995, the Company entered into an
employment agreement with its president, Dennis W. Olson. The employment
agreement is for a term of three years ending January 1, 1998; provides for
annual compensation and benefits, provides that upon full disability, Mr. Olson
will be entitled to full salary for three months, two thirds salary for three
months, and one half salary for six months; provides that the employment
agreement shall be binding upon any successor to the Company; and the agreement
provides that, upon the expiration of the employment agreement, the Company
shall be required, at Mr. Olson's option, to purchase from him up to 500,000
shares of the Company's Common Stock at $1.00 per share.

Transactions With Management and Others and Certain Business Relationships.
Certain officers and directors of the Company have in the past made personal
loans to the Company when it was in need of short term financing. At April 1,
1996, such loans from affiliates were as follows:

Interest Maturity
Lender Amount Rate Date
------ ------ -------- --------

Dennis W. Olson............. $150,000 11.0% On Demand

</TABLE>

This loan is unsecured, is at a rate that would generally be available from
local banking institutions for good customers, and is subordinated to then
outstanding bank loans to the Company. All loan transactions with related
persons have been on terms no less favorable than those available from third
parties. It is probable that the Company will continue to engage in such
borrowing activities in the future; however, there are currently no specific
plans to do so.

R. A. Fitzner, Jr. became a director of the Company as a result of the
reorganization transaction set forth in the RAFCO Agreement. See Form 10-K/A,
"Business -- Acquisition of RAFCO." As a result of such reorganization
transaction, Mr. Fitzner received 4,784,705 shares of the Company's Common Stock
and 5,000 shares of the Company's Preferred Stock. As a result of such
reorganization transaction, the Company assumed the obligation to Mr. Fitzner on
a 10% senior subordinated note due December 31, 2003 in the amount of $50,000
and the Company issued 2,500 shares of Preferred Stock to Earlene E. Fitzner,
Mr. Fitzner's mother. The Company has assumed the obligation to pay a 10% senior
subordinated note due December 31, 2003 in the principal amount of $150,000 to
Mr. Fitzner's mother and has assumed the obligation to pay a 10% senior
subordinated note due December 31, 2003 in the principal amount of $50,000 to
Mr. Fitzner's father, Robert A. Fitzner, Sr.

Robert L. Long became a director of the Company as a result of the
reorganization transaction set forth in the RAFCO Agreement. See Form 10-K/A,
"Business -- Acquisition of RAFCO." During 1992, the Company entered into an
investment banking agreement with RAF. As of April 26, 1995, RAF became a wholly
owned subsidiary of the Company. One of the terms of Mr. Long's employment by
RAF is that he will receive a percentage of any investment banking fees received
by RAF. Under the investment banking agreement, the Company would be obligated
to pay a fee to RAF as a result of the reorganization transaction between the
Company and RAFCO which is described in Form 10-K/A, "Business -- Acquisition of
RAFCO." RAF waived its portion of any such investment banking fee. On April 26,
1995, the Company agreed to pay a merger and acquisition fee to Mr. Long in the
amount of $100,000, which was paid to Mr. Long in 1996.

<PAGE>

Dennis W. Olson is currently an officer and a director of the Company. On
April 27, 1995, the Company entered into an agreement to sell certain of its
assets to Telecom as described in Form 10-K/A, "Business -- Sale of Directories
to Telecom." Pursuant to the Telecom Agreement, Mr. Olson and certain other
employees of the Company entered into agreements not to compete with Telecom. As
compensation for this noncompetition agreement, Telecom has paid $125,000 out of
the total of $250,000 to Mr. Olson. On April 27, 1995, the Company granted an
option to Telecom to purchase additional assets of the Company, as described in
Form 10-K/A, "Business -- Sale of Option to Telecom." This option is exercisable
for a period of two years beginning on June 1, 1997. If Telecom exercises this
option, Mr. Olson and certain other employees of the Company will be obligated
to enter into additional noncompete agreements with Telecom and will be paid
additional amounts in consideration for such noncompete agreements. The amount
of such noncompetition payments will not be determined until after Telecom
exercises its option.

On March 22, 1995, Marlow E. Lindblom exercised a stock option and
purchased 20,000 shares of Common Stock of the Company at $0.54 per share, and
on April 28, 1995, Roland Haux exercised a stock option and purchased 70,000
shares of Common Stock of the Company at $0.58 per share. The Company has repaid
the following loans to the president and former officers and directors: Dennis
W. Olson was repaid $20,000 on April 18, 1995 and $50,000 on February 15, 1996;
Marlow E. Lindblom was repaid $10,000 on March 21, 1995; and Roland Haux was
repaid $40,000 on April 27, 1995.

The Company does not have any independent directors. The directors who
determine the compensation of management are the persons who constitute the
management of the Company.

The Company has been engaged in a private offering of 6,000,000 shares of
its Common Stock at $1.00 per share and 6,000,000 Class A Redeemable Common
Stock Purchase Warrants ("Class A Warrants") at a price of $0.10 per share since
February, 1996 ("Private Offering"). The Private Offering will continue until
all securities offered are sold or until the Company decides to terminate the
Private Offering. RAF is acting as the selling agent with respect to the Private
Offering and has an agreement with the Company whereby it shall receive sales
commissions of a maximum of 10% of the amount of securities sold in the Private
Offering. In addition, the Company will issue up to a maximum of 600,000 Class B
Common Stock Purchase Warrants to RAF upon completion of the Private Offering.
RAF will pay a portion of its commission to its employees, including employees
of RAF who are affiliates of the Company.

Prior to May 1, 1997, the Company will file, and thereafter will use its
best efforts to cause to become effective, a registration statement with the
Securities and Exchange Commission and certain states. The Company will include
in such registration statement the resale of the Common Stock sold to investors
in the Private Offering and the Common Stock acquired or which may be acquired
under the Class A Warrants. The Company may include Common Stock for sale under
such registration statement. The Company may enter into an underwriting
agreement with RAF in connection with the sale of Common Stock under the
registration statement for the Company's account. If such an agreement is
entered into, commissions customary in the industry will be paid to RAF and a
portion of such commissions will be paid to RAF's employees who are affiliates
of the Company.

ACTIONS TO BE TAKEN AT MEETING

The Meeting is called by the Board of Directors to consider and act upon
the following matters:

(1) The election of the Directors of the Company;

(2) Amendment of the Company's Articles of Incorporation to change the
name of the Company;

<PAGE>

(3) Approval of the 1996 Incentive and Nonstatutory Stock Option Plan for
the benefit of eligible employees and consultants of the Company; and

(4) Such other matters as may properly come before the meeting or any
adjournment thereof.

The holders of a majority of the outstanding shares of Common Stock and
Preferred Stock of the Company, present at the Meeting in person or represented
by proxy, shall constitute a quorum. If a quorum is present, directors are
elected by a plurality of the vote, i.e., the candidates receiving the highest
number of votes cast in favor of their election will be elected to the Board of
Directors. As to all other actions voted on at the Meeting, if a quorum is
present, the affirmative vote of a majority of the shares entitled to vote at
the Meeting shall be the act of the shareholders. Where brokers have not
received any instruction from their clients on how to vote on a particular
proposal, brokers are permitted to vote on routine proposals but not on
nonroutine matters. The absence of votes on nonroutine matters are "broker
nonvotes." Abstentions and broker nonvotes will be counted as present for
purposes of establishing a quorum, but will have no effect on the election of
directors. There are no dissenter's rights applicable to the election of
directors. Abstentions and broker nonvotes on proposals other than the election
of directors, if any, will be counted as present for purposes of the proposal
and will have the effect of a vote against the proposal.

PROPOSAL NUMBER ONE

ELECTION OF DIRECTORS

The number of directors on the Company's Board of Directors has been
established by the Bylaws of the Company and by resolution of the Board of
Directors as three directors. The terms of all of the directors expire at this
Meeting. Each director holds office until the next annual meeting of
shareholders following his election and thereafter until his successor has been
elected and qualified.

The persons named in the enclosed form of Proxy will vote the shares
represented by such Proxy for the election of the three nominees for directors
named below. If, at the time of the Meeting, either of these nominees shall
become unavailable for any reason, which event is not expected to occur, the
persons entitled to vote the Proxy will vote for such substitute nominee or
nominees, if any, as they determine in their sole discretion. If elected, R. A.
Fitzner, Jr., Dennis W. Olson and Robert L. Long will hold office until the
annual meeting of stockholders to be held in 1997. The nominees for directors,
each of whom has consented to serve if elected, are as follows:

Name of Director
Nominee Since Age Principal Occupation for Last Five Years
- ----------------- -------- --- ------------------------------------------------------------------

R. A. Fitzner, Jr. 1995 50 President, Chief Executive Officer of RAF since 1984 and Director
of RAF since 1986, and a Director of Secutron Corp., a subsidiary
of the Company ("Secutron"), since 1986. Mr. Fitzner has been
Chairman of the Board of the Company since February of 1996 and
a Director of the Company since May of 1995, when RAF became a
wholly owned subsidiary of the Company.

Dennis W. Olson 1977 55 President and a Director of the Company since 1977.

Robert L. Long 1995 62 Senior Vice President and Managing Director of the Corporate
Finance Division of RAF since 1990. Mr. Long became Secretary
of the Company in February of 1996 and a Director of the Company
in May of 1995 after RAF became a wholly owned subsidiary of the
Company.
</TABLE>

9
<PAGE>

PROPOSAL NUMBER TWO

CHANGING THE NAME OF THE COMPANY

The Board of Directors has determined that the Company's business plan
should focus on a strong, well capitalized, full service brokerage business and
away from the directory publishing business. The Board believes that the
Company's name should not be limited to a description of the Company's directory
publishing business, but should be more descriptive of the variety of businesses
engaged in by the Company. The Board is asking the shareholders to approve an
amendment to the Company's Articles of Incorporation to change the name of the
Company to a name to be chosen by the Board of Directors which more accurately
reflects the Company's current businesses and which name is believed by the
Board of Directors to be available nationwide.

PROPOSAL NUMBER THREE

1996 INCENTIVE AND NONSTATUTORY STOCK OPTION PLAN

Summary. The Company's Board of Directors adopted the 1996 Incentive and
Nonstatutory Stock Option Plan ("1996 Plan") on April 8, 1996, subject to
stockholder approval at the Meeting. A copy of the 1996 Plan is attached to this
Proxy Statement as Exhibit A. The following is a brief summary of the 1996 Plan,
which is qualified in its entirety by reference to Exhibit A.

Options granted under the 1996 Plan may be either Nonstatutory Stock
Options ("Nonstatutory Options") or Incentive Stock Options ("Incentive
Options"). The purpose of the 1996 Plan is to advance the interests of the
Company, its stockholders and its subsidiaries by encouraging and enabling
selected officers, directors, employees, independent contractors or agents, upon
whose judgment, initiative and effort the Company is largely dependent for the
successful conduct of its business, to acquire and retain a proprietary interest
in the Company by ownership of its stock through the exercise of stock options.

Amount of Common Stock Subject to Options Under the 1996 Plan. The 1996
Plan provides for the grant of stock options covering an aggregate of 1,250,000
shares of Common Stock. The number of shares of Common Stock subject to options
is subject to equitable adjustments for any stock dividends, stock splits,
recapitalizations, reclassifications or any other similar changes which may be
required in order to prevent dilution. Any option which is not exercised prior
to expiration or which otherwise terminates will thereafter be available for
further grant under the 1996 Plan. As of April 8, 1996, no options had been
granted under the 1996 Plan.

Administration of the 1996 Plan. The 1996 Plan may be administered by the
Board of Directors or by a committee consisting of not fewer than two members of
the Board (the "Committee"), provided however, that the 1996 Plan must be
administered by the Committee if the Company registers any equity security
pursuant to Section 12 of the Securities and Exchange Act, as amended ("Exchange
Act"), during the period beginning on the effective date of such registration
until six months after the termination of such registration. Options may not be
granted under the 1996 Plan to members of the Committee for one year prior to
appointment to the Committee or while serving on the Committee, if the Company
registers any equity security pursuant to Section 12 of the Exchange Act.
Subject to the conditions set forth in the 1996 Plan, the Board of Directors or
the Committee has full and final authority to determine the number of options,
the individuals to whom and the time or times at which such options shall be
granted and be exercisable, their exercise prices and the terms and provisions
of the respective agreements to be entered into at the time of grant, which may
vary. The 1996 Plan is intended to be flexible, and a significant amount of
discretion is vested in the Board of Directors or Committee with respect to all
aspects of the options to be granted under the 1996 Plan.

<PAGE>

Participants. Nonstatutory Options may be granted under the 1996 Plan to
any person who is or who agrees to become an officer, director, employee,
independent contractor or agent of the Company or any of its subsidiaries.
Incentive Options may be granted only to persons who are employees of the
Company or any of its subsidiaries. As of December 15, 1995, the Company and its
subsidiaries had approximately 318 employees.

Exercise Price. The exercise price of each Nonstatutory Option granted
under the 1996 Plan shall be determined by the Board of Directors or the
Committee. The exercise price of each Incentive Option granted under the 1996
Plan shall be determined by the Board of Directors or the Committee and shall in
no event be less than 100% (110% in the case of a person who owns directly or
indirectly more than 10% of the Common Stock) of the fair market value of the
shares on the date of grant. The payment of the exercise price of an option may
be made in cash or shares of Common Stock, as more fully described under
"Exercise of Options." Fair market value shall be determined by the Board of
Directors or the Committee in accordance with the 1996 Plan and such
determination shall be binding upon the Company and upon the holder. The market
value of the Common Stock on April 4, 1996 was $1.00 per share.

Terms of Options. Options may be granted for a term of up to 10 years (five
years in the case of Incentive Options granted to a person who owns directly or
indirectly more than 10% of the Common Stock), which may extend beyond the term
of the 1996 Plan.

Exercise of Options. The terms governing the exercise of options granted
under the 1996 Plan shall be determined by the Board of Directors or the
Committee, which may limit the number of options exercisable in any period.
Payment of the exercise price upon exercise of an option may be made in any
combination of cash and shares of Common Stock, including the automatic
application of shares of Common Stock received upon exercise of an option to
satisfy the exercise price of additional options (unless the Board of Directors
or the Committee provides otherwise). Where payment is made in Common Stock,
such Common Stock shall be valued for such purpose at the fair market value of
such shares on the date of exercise. In no event shall an option granted under
the 1996 Plan be exercisable prior to the date of stockholder approval of the
1996 Plan.

Nontransferability. Options granted under the 1996 Plan are not
transferable or assignable, otherwise than by will or the laws of descent and
distribution and, during the lifetime of the holder, options are exercisable
only by the holder.

Termination of Relationship. Except as the Committee or the Board of
Directors may expressly determine otherwise, if the holder of an option ceases
to be employed by or to have another qualifying relationship (such as that of
director, independent contractor or agent) with the Company or any of its
subsidiaries other than by reason of the holder's death or permanent disability,
all options granted to such holder under the 1996 Plan shall terminate
immediately, except for options which were exercisable on the date of such
termination of relationship, which options shall terminate 60 days after the
date of such termination of relationship unless such options expire or terminate
earlier. However, if a new qualifying relationship is established before the end
of such 60 day period, such exercisable options shall continue until their
expiration or earlier termination. In the event of the death or permanent
disability of the holder of an option, except as the Committee or the Board of
Directors may expressly determine otherwise, options may be exercised to the
extent that the holder might have exercised the options on the date of death or
permanent disability for a period of up to 12 months following the date of death
or permanent disability, unless by their terms the options expire before the end
of such 12 month period.

Amendment and Termination of the 1996 Plan. The Board of Directors may at
any time and from time to time amend or terminate the 1996 Plan, but may not,
without the approval of the stockholders of the Company representing a majority
of the voting power, increase the maximum number of shares of Common Stock
subject to options which may be granted under the 1996 Plan, change the class of
eligible participants or make any material amendment if the Company has a class
of equity securities registered under Section 12 of the Exchange Act at the

<PAGE>

time of such revision or amendment. No amendment or termination of the 1996 Plan
by the Board of Directors may alter or impair any of the rights under any option
granted under the 1996 Plan without the holder's consent.

Effective Date and Term of the 1996 Plan. Options may be granted under the
1996 Plan during its 10 year term, which commenced on April 8, 1996.

Certain Federal Income Tax Consequences.

Incentive Options. The Company believes that with respect to Incentive
Options granted under the 1996 Plan, no income generally will be recognized by
an optionee for federal income tax purposes at the time such an option is
granted or at the time it is exercised. If the optionee makes no disposition of
the shares so received within two years from the date the Incentive Option was
granted and one year from the receipt of the shares pursuant to the exercise of
the Incentive Option, he will generally recognize long term capital gain or loss
upon disposition of the shares.

If the optionee disposes of shares acquired by exercise of an Incentive
Option before the expiration of the applicable holding period, any amount
realized from such a disqualifying disposition will be taxable as ordinary
income in the year of disposition generally to the extent that the lesser of the
fair market value of the shares on the date the option was exercised or the fair
market value at the time of such disposition exceeds the exercise price. Any
amount realized upon such a disposition in excess of the fair market value of
the shares on the date of exercise generally will be treated as long term or
short term capital gain, depending on the holding period of the shares. A
disqualifying disposition will include the use of shares acquired upon exercise
of an Incentive Option in satisfaction of the exercise price of another option
prior to the satisfaction of the applicable holding period.

The Company will not be allowed a deduction for federal income tax purposes
at the time of the grant or exercise of an Incentive Option. At the time of a
disqualifying disposition by an optionee, the Company will be entitled to a
deduction for federal income tax purposes equal to the amount taxable to the
optionee as ordinary income in connection with such disqualifying disposition
(assuming that such amount constitutes reasonable compensation).

Nonstatutory Options. The Company believes that the grant of a Nonstatutory
Option under the 1996 Plan will not be subject to federal income tax. Upon
exercise, the optionee generally will recognize ordinary income, and the Company
will be entitled to a corresponding deduction for federal income tax purposes
(assuming that such compensation is reasonable), in an amount equal to the
excess of the fair market value of the shares on the date of exercise over the
exercise price. Gain or loss on the subsequent sale of shares received on
exercise of a Nonstatutory Option generally will be long term or short term
capital gain or loss, depending on the holding period of the shares.

INDEPENDENT PUBLIC ACCOUNTANTS

The Board of Directors has selected KPMG Peat Marwick, Denver, Colorado, as
the Company's principal accountant for fiscal year 1996. Representatives of KPMG
Peat Marwick are not expected to be present at the Meeting and, therefore, will
not make a statement or be available to respond to appropriate questions.

Changes in and Disagreements With Accountants on Accounting and Financial
Disclosure. There were no changes in accountants or disagreements of the type
required to be reported under this item between the Company and its independent
accountants during the fiscal year ended September 30, 1994.

<PAGE>

On September 1, 1995, the Company's former accountant, Eide Helmeke & Co.
("Eide"), located in Bismarck, North Dakota, resigned as the Company's principal
accountant. Eide's report on the Company's consolidated financial statements for
the fiscal year ended September 30, 1994 did not contain an adverse opinion or a
disclaimer of opinion, nor was it qualified or modified as to any uncertainty,
audit, scope or accounting principles. Following the Company's acquisition of
RAFCO in April 1995, the Board of Directors recommended and approved a change in
accountants from Eide to KPMG Peat Marwick, LLP. During the Company's fiscal
years ended September 30, 1993, and 1994, and during the interim period from
October 1, 1994 through April 30, 1995, there were no disagreements with Eide on
any matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreement, if not resolved
to Eide's satisfaction, would have caused it to make a reference to the subject
matter of the disagreement in connection with its report. The Company engaged
KPMG Peat Marwick, Denver, Colorado, as its principal accountant on September
29, 1995.

DOCUMENTS INCORPORATED BY REFERENCE

The following documents previously filed by the Company with the Securities
and Exchange Commission are incorporated herein by reference: (i) the Company's
Annual Report on Form 10-K, as amended on Form 10- K/A, for the year ended
September 30, 1995; (ii) the Company's Quarterly Report on Form 10-Q, as amended
on Form 10-Q/A, for the quarter ended December 31, 1995; and (iii) the Company's
Report by Issuer of Securities Quoted on NASDAQ Interdealer Quotation System on
Form 10-C dated April 2, 1996. All documents filed by the Company pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 after the date of
this Proxy Statement and prior to the Meeting (or any adjournments thereof)
shall be deemed to be incorporated into this Proxy Statement by reference and to
be a part hereof from the date of filing of such documents.

This proxy statement is accompanied by a copy of the Company's Annual
Report to Shareholders for the fiscal year ended September 30, 1995. The Company
will provide without charge to each person to whom a copy of this Proxy
Statement has been delivered, on the written or oral request of such person, by
first class mail or equally prompt means, within one business day of the receipt
of such request, copies of all of the information that has been incorporated
herein by reference (but not including exhibits to the information that has been
incorporated by reference unless such exhibits are specifically incorporated by
reference into the information that is incorporated into this Proxy Statement).
Requests for such copies should be directed to Robert L. Long, Secretary, at the
Company at its principal offices, One Norwest Center, 1700 Lincoln Street, 32nd
Floor, Denver, Colorado, 80203, or by telephone at (303) 860-1700.

STOCKHOLDER PROPOSALS

Proposals of stockholders intended to be presented at the next annual
meeting of the Company's stockholders must be received by the Company within a
reasonable time prior to the mailing of the proxy statement for such Meeting but
no later than December 17, 1996.

SOLICITATION OF PROXIES

The cost of soliciting proxies, including the cost of preparing, assembling
and mailing this proxy material to stockholders, will be borne by the Company.
Solicitations will be made only by use of the mails, except that, if necessary
to obtain a quorum, officers and regular employees of the Company may make
solicitations of proxies by telephone or electronic facsimile or by personal
calls. Brokerage houses, custodians, nominees and fiduciaries will be requested

<PAGE>

to forward the proxy soliciting material to the beneficial owners of the
Company's shares held of record by such persons and the Company will reimburse
them for their charges and expenses in this connection.

OTHER BUSINESS

The Company's Board of Directors does not know of any matters to be
presented at the Meeting other than the matters set forth herein. If any other
business should come before the Meeting, the persons named in the enclosed form
of Proxy will vote such Proxy according to their judgment on such matters.

By Order of the Board of Directors

Robert L. Long, Secretary

Denver, Colorado
April _____, 1996

<PAGE>

PRELIMINARY COPY
PROXY

FRONTEER DIRECTORY COMPANY, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 3, 1996

The undersigned hereby constitutes and appoints R. A. Fitzner, Jr., Dennis
W. Olson, Robert L. Long, and each of them, the true and lawful attorneys and
proxies of the undersigned with full power of substitution and appointment, for
and in the name, place and stead of the undersigned, to act for and to vote all
of the undersigned's shares of common stock and Series A Voting Cumulative
Preferred Stock of Fronteer Directory Company, Inc. ("Company") at the Annual
Meeting of Stockholders to be held at the Holiday Inn, Sixth and Broadway,
Bismarck, North Dakota, on May 3, 1996, at 4:00 p.m., Central Standard Time, and
at all adjournments thereof for the following purposes:

1. Election of Directors.

[ ] FOR THE DIRECTOR [ ] WITHHOLD AUTHORITY TO VOTE FOR
NOMINEES LISTED BELOW ALL NOMINEES LISTED BELOW
(EXCEPT AS MARKED TO
THE CONTRARY BELOW)

INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE, STRIKE A LINE THROUGH THE NOMINEE'S NAME IN THE LIST BELOW.

R. A. Fitzner, Jr.
Dennis W. Olson
Robert L. Long

2. Amendment of Articles of Incorporation to change the name of the
Company.

[ ] FOR [ ] AGAINST [ ] ABSTAIN FROM VOTING

3. Approval of the 1996 Incentive and Nonstatutory Stock Option Plan for
the benefit of eligible employees and consultants of the Company.

[ ] FOR [ ] AGAINST [ ] ABSTAIN FROM VOTING

4. In their discretion, the Proxies are authorized to vote upon such other
business as lawfully may come before the Meeting.

The undersigned hereby revokes any proxies as to said shares heretofore
given by the undersigned and ratifies and confirms all that said attorneys and
proxies lawfully may do by virtue hereof.

THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS SPECIFIED. IF NO
SPECIFICATION IS MADE, THEN THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED
AT THE MEETING (1) FOR ELECTION OF THE NOMINEES FOR DIRECTOR AS SELECTED BY THE
BOARD OF DIRECTORS; (2) TO AMEND THE ARTICLES OF INCORPORATION; AND (3) TO
APPROVE THE INCENTIVE STOCK OPTION PLAN.

<PAGE>

It is understood that this proxy confers discretionary authority in respect
to matters not known or determined at the time of the mailing of the Notice of
Annual Meeting of Stockholders to the undersigned. The proxies and attorneys
intend to vote the shares represented by this proxy on such matters, if any, as
determined by the Board of Directors.

The undersigned hereby acknowledges receipt of the Notice of Annual Meeting
of Stockholders and the Proxy Statement furnished therewith.

Dated and Signed:

---------------------------------, 1996

---------------------------------------

Signature(s) should agree with the
name(s) stenciled hereon. Executors,
administrators, trustee, guardians and
attorneys should so indicate when
signing. Attorneys should submit powers
of attorney

FRONTEER DIRECTORY COMPANY, INC.

1996 INCENTIVE AND NONSTATUTORY
STOCK OPTION PLAN

1. Purpose of the Plan. The purposes of this 1996 Incentive and
Nonstatutory Stock Option Plan are to attract and retain the best available
personnel for positions of substantial responsibility, to provide additional
incentive to the Employees and Consultants of the Company and to promote the
success of the Company's business.

Options granted hereunder may be either "incentive stock options," as
defined in Section 422 of the Internal Revenue Code of 1986 or "nonstatutory
stock options," at the discretion of the Board and as reflected in the terms of
the written stock option agreement.

2. Definitions. As used herein, the following definitions shall apply:

a. "Board" shall mean the Committee, if one has been appointed, or the
Board of Directors of the Company if no Committee is appointed.

b. "Code" shall mean the Internal Revenue Code of 1986, as amended.

c. "Common Stock" shall mean the $0.01 par value common stock of the
Company.

d. "Company" shall mean Fronteer Directory Company, Inc., a Colorado
corporation.

e. "Committee" shall mean the Committee appointed by the Board in
accordance with paragraph (a) of Section 4 of the Plan, if one is
appointed.

f. "Consultant" shall mean any person who is engaged by the Company or
any Subsidiary to render consulting services and is compensated for such
consulting services, and any director of the Company whether compensated
for such services or not; provided that if and in the event the Company
registers any class of any equity security pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended ("Exchange Act"), the term
Consultant shall thereafter not include directors who are not compensated
for their services or are paid only a director's fee by the Company.

g. "Continuous Status as an Employee or Consultant" shall mean the
absence of any interruption or termination of service as an Employee or
Consultant. Continuous Status as an Employee or Consultant shall not be
considered interrupted in the case of sick leave, military leave, or any
other leave of absence approved by the Board; provided that such leave is
for a period of not more than 90 days or reemployment upon the expiration
of such leave is guaranteed by contract or statute.

<PAGE>

h. "Employee" shall mean any person, including officers and directors,
employed by the Company or any Parent or Subsidiary of the Company. The
payment of a director's fee by the Company shall not be sufficient to
constitute "employment" by the Company.

i. "Incentive Stock Option" shall mean an Option which is intended to
qualify as an incentive stock option within the meaning of Section 422 of
the Code and which shall be clearly identified as such in the written Stock
Option Agreement provided by the Company to each Optionee granted an
Incentive Stock Option under the Plan.

j. "Nonstatutory Stock Option" shall mean an Option granted under this
Plan which does not qualify as an Incentive Stock Option and which shall be
clearly identified as such in the written Stock Option Agreement provided
by the Company to each Optionee granted a Nonstatutory Stock Option under
this Plan. To the extent that the aggregate fair market value of Optioned
Stock to which Incentive Stock Options granted under Options to an Employee
are exercisable for the first time during any calendar year (under the Plan
and all plans of the Company or any Parent or Subsidiary) exceeds $100,000,
such Options shall be treated as Nonstatutory Stock Options under the Plan.
The aggregate fair market value of the Optioned Stock shall be determined
as of the date of grant of each Option and the determination of which
Incentive Stock Options shall be treated as qualified incentive stock
options under Section 422 of the Code and which Incentive Stock Options
exercisable for the first time in a particular year in excess of the
$100,000 limitation shall be treated as Nonstatutory Stock Options shall be
determined based on the order in which such Options were granted in
accordance with Section 422(d) of the Code.

k. "Option" shall mean an Incentive Stock Option, a Nonstatutory Stock
Option or both as identified in a written Stock Option Agreement
representing such stock option granted pursuant to the Plan.

l. "Optioned Stock" shall mean the Common Stock subject to an Option.

m. "Optionee" shall mean an Employee or Consultant who receives an
Option.

n. "Parent" shall mean a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.

<PAGE>

o. "Plan" shall mean this 1996 Incentive and Nonstatutory Stock Option
Plan.

p. "Share" shall mean a share of the Common Stock of the Company, as
adjusted in accordance with Section 11 of the Plan.

q. "Stock Option Agreement" shall mean the agreement to be entered
into between the Company and each Optionee which shall set forth the terms
and conditions of each Option granted to each Optionee, including the
number of Shares underlying such Option and the exercise price of each
Option granted to such Optionee under such agreement.

r. "Subsidiary" shall mean a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.

3. Stock Subject to the Plan. Subject to the provisions of Section 11 of
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 1,250,000 shares of Common Stock. The Shares may be
authorized, but unissued, or reacquired Common Stock.

If an Option should expire or become unexercisable for any reason without
having been exercised in full, the unpurchased Shares which were subject thereto
shall, unless the Plan shall have been terminated, become available for future
grant under the Plan.

4. Administration of the Plan.

a. Procedure. The Plan shall be administered by the Board.

(i) Subject to subparagraph (ii), the Board may appoint a
Committee consisting of not fewer than two members of the Board
to administer the Plan on behalf of the Board, subject to such
terms and conditions as the Board may prescribe.

(ii) Notwithstanding the foregoing subparagraph (i), if in
any event the Company registers any class of any equity security
pursuant to Section 12 of the Exchange Act, from the effective
date of such registration until six months after the termination
of such registration, any grants of Options to officers or
directors of the Company shall be made only by a Committee
consisting of two or more directors appointed by the Board and
having full authority to act in the matter, none of whom during
the one year prior to such appointment or while serving on the
Committee, is granted an Option under this Plan or is granted or
awarded equity securities pursuant to any other plan of the
Company or any of its affiliates, except as permitted by Rule
16b-3 under the Exchange Act.

<PAGE>

(iii)Once appointed, the Committee shall continue to serve
until otherwise directed by the Board. From time to time the
Board may increase the size of the Committee and appoint
additional members thereof, remove members (with or without
cause) and appoint new members in substitution therefor, fill
vacancies however caused, or remove all members of the Committee
and thereafter directly administer the Plan.

(iv) Members of the Board who are either eligible for
Options or have been granted Options may vote on any matters
affecting the administration of the Plan or the grant of any
Options pursuant to the Plan, except that no such member shall
act upon the granting of an Option to himself, but any such
member may be counted in determining the existence of a quorum at
any meeting of the Board during which action is taken with
respect to the granting of Options to him.

b. Powers of the Board. Subject to the provisions of the Plan,
the Board shall have the authority, in its discretion:

(i) To grant Incentive Stock Options, in accordance with
Section 422 of the Code and, subject to the provisions of Section
16 hereof, Nonstatutory Stock Options or both as provided and
identified in a separate written Stock Option Agreement to each
Optionee granted such Option or Options under the Plan; provided
however, that in no event shall an Incentive Stock Option and a
Nonstatutory Option granted to any Optionee under a single Stock
Option Agreement be subject to a "tandem" exercise arrangement
such that the exercise of one such Option affects the Optionee's
right to exercise the other Option granted under such Stock
Option Agreement;

(ii) To determine, upon review of relevant information and
in accordance with Section 8(b) of the Plan, the fair market
value of the Common Stock;

(iii) To determine the exercise price per Share of Options
to be granted, which exercise price shall be determined in
accordance with Section 8(a) of the Plan;

(iv) To determine the Employees or Consultants to whom, and
the time or times at which, Options shall be granted and the
number of Shares to be represented by each Option;

<PAGE>

(v) To interpret the Plan;

(vi) To prescribe, amend and rescind rules and
regulations relating to the Plan;

(vii) To determine the terms and provisions of each
Option granted (which need not be identical) and, with the
consent of the holder thereof, modify or amend each Option;

(viii) To accelerate or defer (with the consent of the
Optionee) the exercise date of any Option, consistent with
the provisions of Section 5 of the Plan;

(ix) To authorize any person to execute on behalf of
the Company any instrument required to effectuate the grant
of an Option previously granted by the Board; and

(x) To make all other determinations deemed necessary
or advisable for the administration of the Plan.

c. Effect of Board's Decision. All decisions, determinations
and interpretations of the Board shall be final and binding on
all Optionees and any other permissible holders of any Options
granted under the Plan.

5. Eligibility.

a. Persons Eligible. Options may be granted only to
Employees and Consultants. Incentive Stock Options may be granted
only to Employees. An Employee, who is also a director of the
Company, its Parent or a Subsidiary, shall be treated as an
Employee for purposes of this Section 5. An Employee or
Consultant who has been granted an Option may, if he is otherwise
eligible, be granted an additional Option or Options.

b. No Effect on Relationship. The Plan shall not confer upon
any Optionee any right with respect to continuation of employment
or consulting relationship with the Company nor shall it
interfere in any way with his right or the Company's right to
terminate his employment or consulting relationship at any time.

6. Term of Plan. The Plan shall become effective on April 8, 1996. It shall
continue in effect until April 8, 2006, unless sooner terminated under Section
13 of the Plan.

7. Term of Option. The term of each Option shall be 10 years from the date
of grant thereof or such shorter term as may be provided in the Stock Option
Agreement.

<PAGE>

However, in the case of an Option granted to an Optionee who, at the time the
Option is granted, owns stock representing more than 10% of the total combined
voting power of all classes of stock of the Company or any Parent or Subsidiary,
if the Option is an Incentive Stock Option, the term of the Option shall be five
years from the date of grant thereof or such shorter time as may be provided in
the Stock Option Agreement.

8. Exercise Price and Consideration.

a. Exercise Price. The per Share exercise price for the Shares to be
issued pursuant to exercise of an Option shall be such price as is
determined by the Board, but the per Share exercise price under an
Incentive Stock Option shall be subject to the following:

(i) If granted to an Employee who, at the time of the grant of
such Incentive Stock Option, owns stock representing more than 10% of
the voting power of all classes of stock of the Company or any Parent
or Subsidiary, the per Share exercise price shall not be less than
110% of the fair market value per Share on the date of grant.

(ii) If granted to any other Employee, the per Share exercise
price shall not be less than 100% of the fair market value per Share
on the date of grant.

b. Determination of Fair Market Value. The fair market value per Share
on the date of grant shall be determined as follows:

(i) If the Common Stock is listed on the New York Stock Exchange,
the American Stock Exchange or such other securities exchange
designated by the Board, or admitted to unlisted trading privileges on
any such exchange, or if the Common Stock is quoted on a National
Association of Securities Dealers, Inc. system that reports closing
prices, the fair market value shall be the closing price of the Common
Stock as reported by the Wall Street Journal on the day the fair
market value is to be determined, or if no such price is reported for
such day, then the determination of such closing price shall be as of
the last immediately preceding day on which the closing price is so
reported;

(ii) If the Common Stock is not so listed or admitted to unlisted
trading privileges or so quoted, the fair market value shall be the
average of the last reported highest bid and the lowest asked prices
quoted on the National Association of Securities Dealers, Inc.
Automated Quotations System or, if not so quoted, then by the National
Quotation Bureau, Inc. on the day the fair market value is determined;
or

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(iii) If the Common Stock is not so listed or admitted to
unlisted trading privileges or so quoted, and bid and asked prices are
not reported, the fair market value shall be determined in such
reasonable manner as may be prescribed by the Board.

c. Consideration and Method of Payment. The consideration to be paid
for the Shares to be issued upon exercise of an Option, including the
method of payment, shall be determined by the Board and may consist
entirely of cash, check, other shares of Common Stock having a fair market
value on the date of surrender equal to the aggregate exercise price of the
Shares as to which said Option shall be exercised, or any combination of
such methods of payment, or such other consideration and method of payment
for the issuance of Shares to the extent permitted under the Colorado
Business Corporation Act.

9. Exercise of Option.

a. Procedure for Exercise: Rights as a Shareholder. Any Option granted
hereunder shall be exercisable at such times and under such conditions as
determined by the Board, including performance criteria with respect to the
Company and/or the Optionee, and as shall be permissible under the terms of
the Plan.

An Option may not be exercised for a fraction of a Share.

An Option shall be deemed to be exercised when
written notice of such exercise has been given to the Company in
accordance with the terms of the Option by the person entitled to
exercise the Option and full payment for the Shares with respect to
which the Option is exercised has been received by the Company. Full
payment, as authorized by the Board, may consist of a consideration and
method of payment allowable under Section 8(c) of the Plan. Until the
issuance (as evidenced by the appropriate entry on the books of the
Company or of the duly authorized transfer agent of the Company) of the
stock certificate evidencing such Shares, no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect
to the Optioned Stock, notwithstanding the exercise of the Option. No
adjustment will be made for a dividend or other right for which the
record date is prior to the date the stock certificate is issued,
except as provided in Section 11 of the Plan.

Exercise of an Option in any manner shall result in a
decrease in the number of Shares which thereafter may be available,
both for purposes of the Plan and for sale under the Option, by the
number of Shares as to which the Option is exercised.

b. Termination of Status as an Employee or Consultant. If any Employee
or Consultant ceases to serve as an Employee or Consultant (as the case

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may be), he may, but only within 60 days (or such other period of time
not exceeding three months as is determined by the Board at the time of
grant of the Option) after the date he ceases to be an Employee or
Consultant (as the case may be) of the Company, exercise his Option to
the extent that he was entitled to exercise it at the date of such
termination. To the extent that he was not entitled to exercise the
Option at the date of such termination, or if he does not exercise such
Option (which he was entitled to exercise) within the time specified
herein, the Option shall terminate.

c. Disability of Optionee. Notwithstanding the provisions of Section
9(b) above, in the event an Employee or Consultant is unable to continue
his employment or consulting relationship (as the case may be) with the
Company as a result of his total and permanent disability (as defined in
Section 22(e)(3) of the Code), he may, but only within six months (or such
other period of time not exceeding 12 months as is determined by the Board
at the time of grant of the Option) from the date of termination, exercise
his Option to the extent he was entitled to exercise it at the date of such
termination. To the extent that he was not entitled to exercise the Option
at the date of termination, or if he does not exercise such Option (which
he was entitled to exercise) within the time specified herein, the Option
shall terminate.

d. Death of Optionee. In the event of the death of the Optionee:

(i) During the term of the Option if the Optionee was at the time
of his death an Employee or Consultant of the Company and had been in
Continuous Status as an Employee or Consultant since the date of grant
of the Option, the Option may be exercised, at any time within 12
months following the date of death, by the Optionee's estate or by a
person who acquired the right to exercise the Option by bequest or
inheritance, but only to the extent of the right to exercise that
would have accrued had the Optionee continued living and remained in
Continuous Status as an Employee or Consultant 12 months after the
date of death; or

(ii) Within 60 days (or such other period of time not exceeding
three months as is determined by the Board at the time of grant of the
Option) after the termination of Continuous Status as an Employee or
Consultant, the Option may be exercised, at any time within 12 months
following the date of death, by the Optionee's estate or by a person
who acquired the right to exercise the Option by bequest or
inheritance, but only to the extent of the right to exercise that had
accrued at the date of termination.

10. Nontransferability of Options. The Option may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent and distribution and may be exercised, during the
lifetime of the Optionee, only by the Optionee.

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11. Adjustments Upon Changes in Capitalization or Merger. Subject to any
required action by the shareholders of the Company, the number of Shares covered
by each outstanding Option, and the number of Shares which have been authorized
for issuance under the Plan but as to which no Options have yet been granted or
which have been returned to the Plan upon cancellation or expiration of any
Option, as well as the price per Share covered by each such outstanding Option,
shall be proportionately adjusted for any increase or decrease in the number of
issued Shares resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt
of consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of Shares subject to an Option.

In the event of the proposed dissolution or liquidation of the Company, the
Option will terminate immediately prior to the consummation of such proposed
action, unless otherwise provided by the Board. The Board may, in the exercise
of its sole discretion in such instances, declare that any Option shall
terminate as of a date fixed by the Board and give each Optionee the right to
exercise his Option as to all or any part of the Optioned Stock, including
Shares as to which the Option would not otherwise be exercisable. In the event
of the proposed sale of all or substantially all of the assets of the Company,
or the merger of the Company with or into another corporation, the Option shall
be assumed or an equivalent option shall be substituted by such successor
corporation or a parent or subsidiary of such successor corporation, unless the
Board determines, in the exercise of its sole discretion and in lieu of such
assumption or substitution, that the Optionee shall have the right to exercise
the Option as to all of the Optioned Stock, including Shares as to which the
Option would not otherwise be exercisable. If the Board makes an Option fully
exercisable in lieu of assumption or substitution in the event of a merger or
sale of assets, the Board shall notify the Optionee that the Option shall be
fully exercisable for a period of 30 days from the date of such notice, and the
Option will terminate upon the expiration of such period.

12. Time of Granting Options. The date of grant of an Option shall, for all
purposes, be the date on which the Board makes the determination granting such
Option. Notice of the determination shall be given to each Employee or
Consultant to whom an Option is so granted within a reasonable time after the
date of such grant. Within a reasonable time after the date of the grant of an
Option, the Company shall enter into and deliver to each Employee or Consultant
granted such Option a written Stock Option Agreement as provided in Sections
2(q) and 16 hereof, setting forth the terms and conditions of such Option and
separately identifying the portion of the Option which is an Incentive Stock
Option and/or the portion of such Option which is a Nonstatutory Stock Option.

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13. Amendment and Termination of the Plan.

a. Amendment and Termination. The Board may amend or terminate the
Plan from time to time in such respects as the Board may deem advisable;
provided that, the following revisions or amendments shall require approval
of the shareholders of the Company in the manner described in Section 17 of
the Plan:

(i) An increase in the number of Shares subject to the Plan above
1,250,000 Shares, other than in connection with an adjustment under
Section 11 of the Plan;

(ii) Any change in the designation of the class of Employees or
Consultants eligible to be granted Options; or

(iii) If the Company has a class of equity securities registered
under Section 12 of the Exchange Act at the time of such revision or
amendment, any material amendment under the Plan.

b. Shareholder Approval. If any amendment requiring shareholder
approval under Section 13(a) of the Plan is made subsequent to the first
registration of any class of equity security by the Company under Section
12 of the Exchange Act, such shareholder approval shall be solicited as
described in Section 17(a) of the Plan.

c. Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if the Plan had not been
amended or terminated, unless mutually agreed otherwise between the
Optionee and the Board, which agreement must be in writing and signed by
the Optionee and the Company.

14. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant
to the exercise of an Option unless the exercise of such Option and the issuance
and delivery of such Shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act, the rules and regulations promulgated thereunder,
applicable state securities laws, and the requirements of any stock exchange
upon which the Shares may then be listed, and shall be further subject to the
approval of legal counsel for the Company with respect to such compliance.

As a condition to the existence of an Option, the Company may require the
person exercising such Option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any
present intention to sell or distribute such Shares and such other
representations and warranties which in the opinion of legal counsel for the
Company, are necessary or appropriate to establish an exemption

<PAGE>

from the registration requirements under applicable federal and state securities
laws with respect to the acquisition of such Shares.

15. Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

Inability of the Company to obtain authority from any regulatory body
having jurisdiction, which authority is deemed by the Company's legal counsel to
be necessary for the lawful issuance and sale of any Share hereunder, shall
relieve the Company of any liability relating to the failure to issue or sell
such Shares as to which such requisite authority shall not have been obtained.

16. Option Agreement. Each Option granted to an Employee or Consultant
shall be evidenced by a written Stock Option Agreement in such form as the Board
shall approve.

17. Shareholder Approval. Continuance of the Plan shall be subject to
approval by the shareholders of the Company on or before April 15, 1997. If such
shareholder approval is obtained at a duly held shareholders meeting, it may be
obtained by the affirmative vote of the holders of a majority of the outstanding
shares of the voting stock of the Company, who are present or represented and
entitled to vote thereon, or by unanimous written consent of the shareholders in
accordance with the provisions of the Colorado Business Corporation Act. The
approval of the Plan by such shareholders of the Company shall be solicited
substantially in accordance with Section 14(a) of the Exchange Act and the rules
and regulations promulgated thereunder.

If such shareholder approval is not solicited for any reason substantially
in accordance with the rules and regulations, if any, in effect under Section
14(a) of the Exchange Act at the time of such vote or written consent, the
Company shall furnish in writing to the holders entitled to vote for approval or
disapproval of the Plan at or prior to the first annual meeting of shareholders
held subsequent to the later of (i) first registration of any class of equity
securities of the Company under Section 12 of the Exchange Act or (ii) the
acquisition of an equity security of the Company for which an exemption is
claimed under Section 16(b) of the Exchange Act, substantially the same
information concerning the Plan as that which would be required by the rules and
regulations in effect under Section 14(a) of the Exchange Act at the time such
information is furnished if proxies to be voted with respect to the approval or
disapproval of the Plan were then being solicited.

18. Information to Optionees. The Company shall provide to each Optionee,
during the period for which such Optionee has one or more Options outstanding,
copies of all annual reports and other information which are provided to all
shareholders of the Company. The Company shall not be required to provide such

<PAGE>

information if the issuance of Options under the Plan is limited to key
employees whose duties in connection with the Company assure their access to
equivalent information.

19. Gender. As used herein, the masculine, feminine and neuter genders
shall be deemed to include the others in all cases where they would so apply.

20. CHOICE OF LAW. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND
INTERPRETATION OF THIS PLAN AND THE INSTRUMENTS EVIDENCING OPTIONS WILL BE
GOVERNED BY THE INTERNAL LAW, AND NOT THE LAW OF CONFLICTS, OF THE STATE OF
COLORADO.

IN WITNESS WHEREOF, the Company has caused its duly authorized officer to
execute this Plan effective as of the 8th day of April, 1996.

FRONTEER DIRECTORY COMPANY, INC.
a Colorado corporation

By: s/s R. A. Fitzner
-----------------------------------
R. A. Fitzner, Chairman of the Board

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