<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. 1)
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
Check the appropriate box:
<TABLE>
<S> <C>
/ / Preliminary Proxy Statement / / Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
AirTouch Communications, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 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 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:
__________________________________________________________________
* Previously paid with definitive materials filed on March 29, 1995.
(/R>
<PAGE> 2
[LOGO]
AIRTOUCH COMMUNICATIONS, INC.
ONE CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94111
NOTICE OF ANNUAL MEETING
MAY 18, 1995
The 1995 Annual Meeting of Stockholders of AirTouch Communications, Inc.
(the "Company") will be held at The Fashion Center, 699 Eighth Street, San
Francisco, California 94103 on Thursday, May 18, 1995 at 10:30 a.m. (the
"Meeting") for the following purposes:
1. To elect three directors, constituting Class I of the Company's Board of
Directors, to serve a three-year term.
2. To ratify the appointment of Coopers & Lybrand L.L.P. as the Company's
independent auditors for 1995.
3. To transact such other business as may properly come before the Meeting,
or any adjournment or postponement thereof.
Stockholders of record at the close of business on March 20, 1995 will be
entitled to vote at the Meeting or any adjournment or postponement thereof.
A list of stockholders entitled to vote at the Meeting will be available
for inspection ten days prior to the Meeting at the offices of the Company, One
California Street, 28th Floor, San Francisco, California 94111.
Your vote is important. We urge you to return your executed proxy card to
ensure your representation at the Meeting. Please complete, date, sign and
promptly mail the enclosed proxy card in the return envelope provided.
By Order of the Board of Directors
[SIG]
Margaret G. Gill
Senior Vice President Legal,
External Affairs and Secretary
San Francisco, California
April 10, 1995
<PAGE> 3
AIRTOUCH COMMUNICATIONS, INC.
ONE CALIFORNIA STREET
SAN FRANCISCO, CALIFORNIA 94111
PROXY STATEMENT
This proxy statement, notice of meeting and accompanying proxy card are
being mailed beginning on April 10, 1995 to stockholders of AirTouch
Communications, Inc. (the "Company") in connection with the solicitation by the
Board of Directors of the Company of proxies for the Annual Meeting of
Stockholders (the "Meeting") to be held on May 18, 1995.
Proxies are solicited to provide all stockholders of record on March 20,
1995 an opportunity to vote on matters scheduled for the Meeting and described
in the proxy materials. Shares can only be voted if the stockholder is present
in person or by proxy. Any person giving a proxy may revoke it at any time
before the Meeting by sending in a written revocation or a proxy bearing a later
date. Stockholders may also revoke their proxies by attending the Meeting in
person and casting a ballot. If proxy cards are signed and returned without
specifying choices, the shares represented by the proxy card will be voted as
recommended by the Board of Directors.
Stockholders of record at the close of business on March 20, 1995 will be
entitled to vote at the Meeting or any adjournment or postponement. On March 20,
1995, 494,174,654 shares of Common Stock, $.01 par value ("Common Stock"), were
outstanding. Each such share is entitled to one vote.
On December 15, 1994, the Company (formerly a California corporation) was
reincorporated in the State of Delaware. All references to the Company in this
proxy statement refer to the Company and its California predecessor.
VOTING OF SHARES
The director nominees who receive the highest number of votes for the
number of positions to be filled will be elected. An affirmative vote of the
holders of the majority of the shares present or represented by proxy at the
Meeting is required for the approval of each of the other matters to be voted
upon. Abstentions will be treated as votes cast on a particular matter as well
as shares present and represented for purposes of establishing a quorum. Where
nominee record holders do not vote on specific issues because they did not
receive specific instructions on such issues from the beneficial owners, such
broker nonvotes will not be treated as votes cast on a particular matter but
will be treated as shares present or represented for purposes of establishing a
quorum.
The Company has adopted a policy that provides all stockholders the option
to request that any proxy, ballot or voting instruction be kept confidential,
except as required by law, or in the event of a contested proxy solicitation, or
to the extent confidentiality is expressly waived in writing by the stockholder.
The policy also provides for the tabulation of the vote by employees of the
Company's transfer agent or by some other independent third party and for the
certification of the vote by an independent inspector of election. The Company
may, however, be informed whether or not a particular stockholder has voted and
may receive periodic status reports on the aggregate vote. Your written comments
on proxies or ballots may be made available to the Company, but your name and
address will not be disclosed if you request confidentiality.
1
<PAGE> 4
PROPOSAL 1
ELECTION OF DIRECTORS
There are nine members of the Board of Directors of the Company. The
Company's Certificate of Incorporation divides the Board into three
approximately equal classes of directors serving staggered three-year terms,
with one class of directors to be elected at each annual meeting. Directors will
hold office until the end of their terms and until their successors have been
elected and qualified.
The proxy holders named on the proxy card will vote for the election of the
three Class I nominees listed below unless otherwise instructed. These nominees
have been selected by the Board of Directors. If you do not wish your shares to
be voted for particular nominees, please identify the exceptions on the proxy
card.
If one or more of the nominees should become unavailable to serve at the
time of the Meeting, the shares represented by the proxies will be voted for the
remaining nominees and for any substitute nominees designated by the Board of
Directors or the size of the Board will be reduced. The Nominating Committee
knows of no reason why any of the nominees will be unavailable or unable to
serve.
The following is a brief description of the principal occupation for at
least the past five years, age and major affiliations of each director.
CLASS I -- NOMINEES FOR ELECTION:
- ---------------------
SAM GINN, 57, has been Chairman of the Board and Chief
Executive Officer of the Company since December 1993. He
is Chairman of the Executive Committee and a member of
the Nominating Committee. He was Chairman of the
[PHOTO] Board, President and Chief Executive Officer of Pacific
Telesis Group from 1988 to April 1994 and became a
director of Pacific Telesis Group in 1983. He was
Chairman of the Board of Pacific Bell from 1988 to April
1994. Mr. Ginn is also a director of Chevron Corporation,
Safeway Inc. and Transamerica Corporation.
- ---------------------
- ---------------------
DONALD G. FISHER, 66, became a director of the Company in
January 1994. He is a member of the Compensation &
Personnel and Nominating Committees. He is the founder,
Chairman of the Board and Chief Executive Officer of The
[PHOTO] Gap, Inc. Mr. Fisher is a director of Ross Stores, Inc.,
The Charles Schwab Corporation, San Francisco Bay Area
Council and the National Retail Federation.
- ---------------------
- ---------------------
CHARLES R. SCHWAB, 57, became a director of the Company
in January 1994. He is Chairman of the Nominating
Committee and a member of the Compensation & Personnel
Committee. He is the founder, Chairman of the
[PHOTO] Board and Chief Executive Officer of The Charles Schwab
Corporation and Chairman of Charles Schwab & Co. Inc. Mr.
Schwab is a director of The Gap, Inc. and Transamerica
Corporation.
- ---------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES ABOVE.
2
<PAGE> 5
CLASS II -- DIRECTORS CONTINUING IN OFFICE UNTIL THE 1996 ANNUAL MEETING OF
STOCKHOLDERS:
- ---------------------
CAROL A. BARTZ, 46, became a director of the Company in
February 1994. She is a member of the Nominating and
Audit Committees. She has been Chairman of the Board,
President and Chief Executive Officer of Autodesk, Inc.
[PHOTO] since April 1992. From 1983 to April 1992, Ms. Bartz
served in various positions with Sun Microsystems, Inc.,
most recently as Vice President of Worldwide Field
Operations.
- ---------------------
- ---------------------
C. LEE COX, 53, was named Vice Chairman of the Board and
President Domestic Wireless Businesses in November 1994.
He is a member of the Nominating and Executive
Committees. He was President and Chief Operating Officer
of the Company from December 1993 to November 1994. He
[PHOTO] was President and Chief Executive Officer of the Company
from 1987 to December 1993, was a director of the
Company from 1987 to April 1993, and became a director
again in January 1994. He was a director and a Group
President of Pacific Telesis Group from 1988 to April
1994. Mr. Cox is a director of Cellular Communications,
Inc.
- ---------------------
- ---------------------
PAUL HAZEN, 53, became a director of the Company in April
1993. He is Chairman of the Audit Committee and a member
of the Executive and Nominating Committees. He became
Chairman and Chief Executive Officer of Wells Fargo &
Company and its principal subsidiary, Wells Fargo Bank,
[PHOTO] N.A. in January 1995. He was President and Chief
Operating Officer of Wells Fargo & Company and Wells
Fargo Bank, N.A., from 1984 to January 1995. He served
as a director of Pacific Telesis Group from 1989 to
April 1994. Mr. Hazen is a director of Wells Fargo &
Company, Wells Fargo Bank, N.A., Phelps Dodge
Corporation and Safeway Inc.
- ---------------------
CLASS III -- DIRECTORS CONTINUING IN OFFICE UNTIL THE 1997 ANNUAL MEETING OF
STOCKHOLDERS:
- ---------------------
JAMES R. HARVEY, 60, became a director of the Company in
April 1993. He is Chairman of the Compensation &
Personnel Committee and a member of the Executive and
Nominating Committees. He has been Chairman of the Board
[PHOTO] of Transamerica Corporation since 1983 and was Chief
Executive Officer of Transamerica from 1981 through 1991.
He was a director of Pacific Telesis Group from 1983 to
April 1994. Mr. Harvey is a director of The Charles
Schwab Corporation, McKesson Corporation and The National
Park Foundation.
- ---------------------
3
<PAGE> 6
- ---------------------
ARTHUR ROCK, 68, became a director of the Company in
January 1994. He is a member of the Audit and Nominating
[PHOTO] Committees. He has been a principal in Arthur Rock &
Co., a venture capital firm, since 1969. Mr. Rock is a
director of Intel Corporation and Argonaut Group, Inc.
- ---------------------
- ---------------------
GEORGE P. SHULTZ, 74, became a director of the Company in
January 1994. He is a member of the Compensation &
Personnel, Executive and Nominating Committees. He has
been a Professor at the Stanford University Graduate
School of Business for more than five years. He served as
[PHOTO] United States Secretary of State from 1982 to 1989. Mr.
Shultz is a Distinguished Fellow at the Hoover
Institution, a director of the Bechtel Group, Inc.,
Chairman of J.P. Morgan's International Council and
Chairman of the Governor's California Economic Policy
Advisory Council.
- ---------------------
COMMITTEES OF THE BOARD OF DIRECTORS
Regular meetings of the Board of Directors are held six times a year and
special meetings are scheduled when required. The Board held seven meetings in
1994. No director attended fewer than 83 percent of the total aggregate number
of Board meetings and meetings of committees on which he or she served.
The Board of Directors has established a number of standing committees. The
Company's Standing Board Committees include the Audit Committee, the
Compensation and Personnel Committee (the "C&P Committee") and the Executive
Committee. The full Board acts as the Nominating Committee.
The Audit Committee, which consists of Mr. Hazen, Chairman, Mr. Rock and
Ms. Bartz, met three times in 1994. The Audit Committee has responsibility for
recommending annually the appointment of independent public accountants and
recommending action as appropriate regarding the adequacy, effectiveness and
legality of the Company's accounts, internal procedures and controls. The Audit
Committee also oversees the investment of trust assets related to benefit plans
and pension funding policy.
The C&P Committee, which consists of Mr. Harvey, Chairman and Messrs.
Fisher, Schwab and Shultz, met five times in 1994. The C&P Committee has
responsibility for reviewing and approving salary and compensation of all
officers, reviewing candidates for promotion to or within officer levels,
establishing or modifying the terms and conditions of the employment of
officers, advising the Board regarding director compensation, keeping informed
of and recommending material changes to employee benefit plans and administering
incentive plans.
The Executive Committee, which consists of Mr. Ginn, Chairman and Messrs.
Cox, Harvey, Hazen and Shultz, met six times in 1994. This Committee has the
full authority of the Board to the extent permitted by Delaware law. Its
function is to deal with issues requiring action between scheduled Board
meetings.
The full Board acts as the Nominating Committee in recommending Board
candidates. This Committee seeks individuals of proven judgment and competence
who are outstanding in their chosen fields. It also considers factors such as
education, geographic location, anticipated participation in Board activities
and special talents or personal attributes. Stockholders who wish to suggest
qualified candidates to the Nominating Committee should write to Margaret G.
Gill, Secretary of the Company, at One California Street, San Francisco,
California 94111, stating in detail the candidate's qualifications for
consideration by the Committee. The Nominating Committee met once in 1994.
4
<PAGE> 7
A stockholder who wishes to nominate a director must comply with certain
procedures set out in the Company's By-Laws (see "Other Matters").
DIRECTOR COMPENSATION AND RELATED TRANSACTIONS
Prior to July 1994, nonemployee directors of the Company received an annual
retainer of $20,000 and fees of $1,200 for each Board meeting attended and $800
for each committee meeting attended. The chairmen of the Audit and C&P
Committees each received an additional annual retainer of $5,000, and the chairs
of other committees of the Board received additional annual retainers of $4,000.
Effective July 1, 1994, nonemployee directors of the Company receive an annual
retainer of $45,000 (eliminating separate Board and committee meeting attendance
fees). The chairmen of committees will receive an additional annual retainer of
$5,000 beginning in 1995. In addition, nonemployee directors are entitled to
reimbursement for out-of-pocket expenses in connection with attendance at Board
and committee meetings. Nonemployee directors may elect to defer the receipt of
all or part of their retainers. Amounts deferred in 1994 earned interest at a
rate of 7.33%. Directors may elect to receive all or a portion of their
retainers in the form of stock options and/or stock units under the Company's
1993 Long-Term Stock Incentive Plan (the "Plan"), provided that an election to
receive options or units is only effective as to amounts payable at least six
months after the election is made. In the case of directors who elect to receive
retainers in the form of stock units, the number of stock units is determined by
dividing the amount that would otherwise be paid in cash by the arithmetic mean
of the closing prices of the Company's Common Stock on the ten consecutive
trading days ending with the date when the amount is payable. The stock units
are immediately vested and have a maximum term of ten years, subject to earlier
termination if the director's service terminates. The stock units are settled in
shares of the Company's Common Stock. In the case of directors who elect to
receive retainers in the form of stock options, the number of options is
determined by using the Black-Scholes option valuation model. These options are
immediately exercisable and have a term of seven years, subject to earlier
termination if the director's service terminates. The exercise price is equal to
the fair market value of the Company's Common Stock on the date of grant, which
is the date the retainers would otherwise be payable.
Each nonemployee director of the Company has been granted 10,000 stock
options under the Plan upon election as a director. Additionally, each
nonemployee director receives a stock option for 1,000 shares at the time of
each Annual Meeting, commencing in 1995. These options generally become
exercisable one year after the date of grant and have a term of ten years,
subject to earlier termination if the director's service terminates. The options
become exercisable in full in the event of the director's death or disability or
in the event that the Company is subject to a change in control. The exercise
price is equal to the fair market value of the Company's Common Stock on the
date of grant. As a condition of the initial 10,000-share option grant, each
director is required, within 30 days after joining the Board, to purchase shares
of the Company's Common Stock with a value of $100,000 or more.
Messrs. Harvey and Hazen were directors of both the Company and Pacific
Telesis Group ("Telesis") and resigned from the Board of Telesis at the time of
the distribution of the Company's stock to the shareholders of Telesis on April
1, 1994 (the "Spin-off"). They did not receive annual and committee chair
retainers from the Company during their terms as joint directors of Telesis and
the Company. They received annual and committee chair retainers from the Company
for their services as nonemployee directors after April 1, 1994. They also
received fees for attendance at Board and committee meetings from the Company at
the rates specified above.
Directors who are also employees of the Company receive no remuneration for
serving as directors or as members of committees of the Board.
Nonemployee directors are reimbursed for the costs of cellular services and
equipment. Employee directors receive similar reimbursements for services and
equipment as part of their compensation as officers.
The Company has entered into indemnity agreements with each of its
directors that provide for indemnification against any judgments or costs
assessed against them in the course of their service as directors. Such
agreements do not permit indemnification for acts or omissions for which
indemnification is not permitted under Delaware law.
5
<PAGE> 8
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth, as of February 1, 1995, information
regarding ownership of the Company's outstanding Common Stock on February 1,
1995 by (i) beneficial owners of more than 5% of the outstanding shares of
Common Stock, (ii) each Named Executive Officer, (iii) each director and (iv)
all executive officers and directors as a group. The table also includes the
number of shares subject to outstanding options to purchase Common Stock of the
Company exercisable within 60 days of February 1, 1995.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF PRESENTLY PERCENT
BENEFICIAL EXERCISABLE OF
NAME OF BENEFICIAL OWNER OWNERSHIP OPTIONS TOTAL CLASS
- ----------------------------------------------- ----------- ----------- ---------- -------
<S> <C> <C> <C> <C>
Sam Ginn....................................... 88,014(1) 426,796 514,810 *
C. Lee Cox..................................... 34,091(2) 244,272 278,363 *
Lydell L. Christensen.......................... 7,571(3) 104,349 111,920 *
Margaret G. Gill............................... 846(4) 0 846 *
Arun Sarin..................................... 37,945(5) 55,389 93,334 *
George F. Schmitt.............................. 7,830(6) 55,389 63,219 *
Carol A. Bartz................................. 4,500(7) 10,000 14,500 *
Donald G. Fisher............................... 44,000(8) 10,000 54,000 *
James R. Harvey................................ 7,467(9) 19,844 27,311 *
Paul Hazen..................................... 6,098 19,844 25,942 *
Arthur Rock.................................... 152,572(10) 10,000 162,572 *
Charles R. Schwab.............................. 4,300(11) 10,000 14,300 *
George P. Shultz............................... 10,000 10,000 20,000 *
All directors and executive officers as a group
(16 persons)................................. 430,659 1,067,598 1,498,257 *
</TABLE>
- ---------------
*Less than 1%
(1) Includes 31,156 shares held by Mr. Ginn's Family Trust, of which Mr. Ginn
is the Trustee, and 3,050 shares held by Mr. Ginn's childrens' Trusts, of
which Mr. Ginn is the Trustee. Includes 40,000 shares of restricted stock
and 13,808 shares held in the Pacific Telesis Group Supplemental Retirement
and Savings Plan for Salaried Employees.
(2) Includes 20,000 shares of restricted stock and 559 shares held in the
Pacific Telesis Group Supplemental Retirement and Savings Plan for Salaried
Employees.
(3) Includes 39 shares held in the AirTouch Communications Retirement Plan and
1,509 shares held in the Pacific Telesis Group Supplemental Retirement and
Savings Plan for Salaried Employees.
(4) Includes 135 shares held in the AirTouch Communications Retirement Plan.
(5) Includes 4,434 shares held in the AirTouch Communications Retirement Plan,
20,000 shares of restricted stock, and 1,698 shares held in the Pacific
Telesis Group Supplemental Retirement and Savings Plan for Salaried
Employees.
(6) Includes 46 shares held in the AirTouch Communications Retirement Plan and
45 shares held in the Pacific Telesis Group Supplemental Retirement and
Savings Plan for Salaried Employees.
(7) All shares are held by Ms. Bartz's Family Trust, of which Ms. Bartz is the
Trustee.
(8) Includes 40,000 shares held by Mr. Fisher's Charitable Trust, of which Mr.
Fisher is the Trustee.
(9) All shares are held by Mr. Harvey's Family Trust, of which Mr. Harvey is
the Trustee.
(10) Includes 2,572 shares held by Mr. Rock's spouse.
(11) Includes 300 shares held by Mr. Schwab's Family Trust, of which Mr. Schwab
is the Trustee.
6
<PAGE> 9
REPORT OF THE COMPENSATION AND PERSONNEL COMMITTEE ON EXECUTIVE COMPENSATION
The compensation of the Company's executive officers is determined by the
C&P Committee, which consists exclusively of nonemployee directors. In
developing the executive compensation program of the Company following the
Spin-off, the C&P Committee was assisted by three firms of independent
compensation consultants.
COMPENSATION POLICIES APPLICABLE TO EXECUTIVE OFFICERS
The three key elements of the Company's compensation program are base
salary, an annual cash bonus and long-term incentives, which consist primarily
of stock options. The base salary of executive officers was set at approximately
the 50th-percentile level relative to executives employed by similar companies.
(This means that base salaries at approximately 50% of the other companies are
lower.) If performance targets are met but not exceeded, cash bonuses are also
intended to be at approximately the 50th-percentile level. If performance
warrants, executive officers have the opportunity to receive total compensation,
including base salary, annual bonus and long-term incentives, which is projected
to be between the 50th and 75th percentiles. The disproportionate emphasis on
long-term incentives is intended to encourage executives to focus on the growth
of the Company and the value of its stock.
In making comparisons with the compensation of executive officers of
similar companies, the C&P Committee considered national salary survey data for
companies that were comparable to the Company with respect to size and gross
revenues. The C&P Committee believes that the Company competes with these
organizations for executive talent. The group of companies considered by the C&P
Committee is not the same as the Peer Group shown in the performance graph on
page nine, because the Company competes for executive talent with companies
other than those included in the Peer Group.
Executive officers and all employees (except certain salespersons)
participate in a Short-Term Incentive Plan under which the cash bonus component
of their compensation is determined. Under the plan, the C&P Committee
determines a standard award amount for each executive officer. The plan provides
for annual payment of cash bonuses in amounts equal to a percentage of the
standard award, based on the level of achievement of selected corporate
performance objectives and on individual performance in the preceding year. The
performance objectives are determined by the C&P Committee in conjunction with
the Board's approval of the Company's business plans at the start of the fiscal
year. Bonuses for 1994 were based on the achievement of financial and operating
performance objectives as well as the achievement of strategic milestones.
Long-term incentives are linked to growth in the value of the Company's
stock and consist primarily of stock options. All stock options, other than
options replacing awards made in prior years by Telesis, have been granted with
an exercise price equal to the fair market value of the stock at the time of
grant and, therefore, provide no compensation to the executive unless the value
of the stock increases.
The C&P Committee has reviewed the impact of Section 162(m) of the Internal
Revenue Code on the Company. This provision limits the amount of compensation
that the Company may deduct from its taxable income for any year to $1 million
for any of its five most highly compensated executive officers. The Company's
Long-Term Stock Incentive Plan includes provisions intended to ensure that the
Company may deduct compensation arising from the exercise of stock options
without regard to the limitation. The C&P Committee has deferred action with
respect to short-term incentives, since the Internal Revenue Service has not
issued final regulations interpreting Section 162(m). No executive officer's
compensation materially exceeded the limitation for 1994.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Mr. Ginn's salary for 1994 was based in part on the C&P Committee's
assessment of his experience in the Company's business, including his prior
position as the Chief Executive Officer of Telesis, the Company's former parent.
His salary also reflected the C&P Committee's analysis of the salaries paid by
comparable
7
<PAGE> 10
companies, as described above. Before the Spin-off on April 1, 1994, Mr. Ginn's
annual base salary from Telesis was $745,000. Following the Spin-off, his annual
base salary from the Company was $575,000.
Like other executive officers and employees, Mr. Ginn participates in the
Company's Short-Term Incentive Plan under which the cash bonus component of his
compensation is determined. As described above, Mr. Ginn's cash bonus for 1994
was based on the level of achievement of predetermined performance objectives,
including financial, strategic and operational objectives of each of the
Company's business units, Company-consolidated cash flow objectives, corporate
headquarters overhead targets and the attainment of strategic milestones. The
relative weight of each performance objective was 50%, 20%, 10% and 20%,
respectively. Strategic milestones for 1994 included the successful launch of
the Company following the Spin-off, significant progress toward positioning the
Company to enter mobile services via satellites, and positioning the Company to
seek licenses for personal communications services (PCS) in key markets. The
financial, strategic operational performance objectives were exceeded by 45% in
the aggregate, resulting in a bonus equal to 145% of the standard award set by
the C&P Committee.
The number of options granted to Mr. Ginn in 1994 was based on the C&P
Committee's policy of providing long-term incentives with a projected value at
the 75th-percentile level, relative to comparable companies. This policy
reflects the C&P Committee's emphasis on long-term incentives related to growth
in the value of the stockholders' investment in the Company. In addition, the
C&P Committee has granted 40,000 shares of restricted stock to Mr. Ginn in 1994
as an incentive to remain in the Company's employment. Mr. Ginn will become
vested in 10,000 of these shares on each of November 18, 1996, 1997, 1998 and
1999 if he remains in the Company's employment. The C&P Committee took into
account the amount of Mr. Ginn's cash compensation in determining the level of
his long-term incentive awards.
April 6, 1995
COMPENSATION AND PERSONNEL COMMITTEE
James R. Harvey, Chairman
Donald G. Fisher
Charles R. Schwab
George P. Shultz
8
<PAGE> 11
PERFORMANCE GRAPH
The following graph compares the cumulative total return on the Company's
Common Stock with a comparable return of the S&P 500 Index (the "S&P 500") and a
self-determined group of peer companies ("Peer Group") for the last 13 months.
The Peer Group consists of Vodafone Group PLC, Rogers Cantel Mobile
Communications, Inc., United States Cellular Corporation, Cellular
Communications, Inc. and Vanguard Cellular Systems, Inc.
The graph assumes that $100 was invested at the time of the Company's
initial public offering on December 2, 1993 in each of the Company's Common
Stock, the S&P 500 and the Peer Group, and that dividends in the S&P 500 and
Peer Group were reinvested.
COMPARISON OF 13-MONTH CUMULATIVE TOTAL RETURN FOR
AIRTOUCH COMMUNICATIONS, INC., THE S&P 500 AND THE COMPANY'S PEER GROUP
<TABLE>
<CAPTION>
MEASUREMENT PERIOD
(FISCAL YEAR COVERED) ATI S&P 500 PEER GROUP
<S> <C> <C> <C>
DEC-93 100.00 100.00 100.00
DEC-93 108.15 101.21 106.53
JAN-94 109.78 104.65 103.45
FEB-94 102.17 101.81 106.03
MAR-94 90.76 97.37 92.93
APR-94 107.07 98.62 96.96
MAY-94 105.98 100.24 97.04
JUN-94 102.72 97.78 93.64
JUL-94 113.04 100.99 104.26
AUG-94 122.83 105.13 115.17
SEP-94 124.46 102.56 112.60
OCT-94 129.89 104.87 122.37
NOV-94 118.48 101.05 114.68
DEC-94 126.63 102.55 118.18
</TABLE>
9
<PAGE> 12
EXECUTIVE COMPENSATION
The following table discloses compensation earned by the Chief Executive
Officer and the five other most highly paid executive officers (the "Named
Executive Officers") for the three fiscal years ended December 31, 1994. Unless
otherwise indicated, positions listed are with the Company.
SUMMARY COMPENSATION TABLE(1)
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
--------------------------------------
ANNUAL COMPENSATION AWARDS PAYOUTS
------------------------------ ------------------------ ----------
(A) (B) (C) (D) (E) (F) (G) (H) (I) (C+D+H)
SECURITIES
OTHER RESTRICTED UNDERLYING ALL TOTAL
NAME AND ANNUAL STOCK OPTIONS/ LTIP OTHER CASH
PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMP($) AWARDS($)(2 SARS(#)(3) PAYOUTS($) COMP($)(4) COMP($)(5)
- ------------------ ---- --------- -------- ------- ----------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Sam Ginn.............. 1994 $618,000 $493,000 -- $2,119,098 398,000 $ 0 $179,000 $1,111,000
Chairman of the Board 1993 744,000 793,000 93,000 0 0 592,000 118,000 2,129,000
and Chief Executive 1992 709,000 581,000 86,000 0 221,488 338,000 102,000 1,628,000
Officer
C. Lee Cox............ 1994 419,000 330,000 -- 1,001,827 195,900 0 129,000 749,000
Vice Chairman of the 1993 458,000 291,000 46,000 0 0 320,000 80,000 1,069,000
Board and President 1992 421,000 293,000 45,000 0 140,276 187,000 64,000 901,000
Domestic Wireless
Businesses
Lydell L. Christensen.. 1994 275,000 206,000 -- 264,257 101,100 0 91,000 481,000
Executive Vice 1993 274,000 243,000 23,000 0 0 83,000 47,000 600,000
President and Chief 1992 243,000 174,000 18,000 0 31,993 49,000 33,000 466,000
Financial Officer
Margaret G. Gill...... 1994 255,000 160,000 -- 0 60,000 0 9,000 415,000
Senior Vice President 1993 0 0 0 0 0 0 0 0
Legal, External 1992 0 0 0 0 0 0 0 0
Affairs and Secretary
Arun Sarin............ 1994 227,000 168,000 -- 639,863 72,800 0 38,000 395,000
Senior Vice President 1993 217,000 110,000 16,000 0 0 95,000 21,000 422,000
Corporate Strategy/ 1992 0 0 0 0 0 0 0 0
Development and Inter-
national Operations
George F. Schmitt(6).. 1994 253,000 158,000 -- 137,149 58,300 0 107,000 411,000
Vice President and 1993 236,000 163,000 27,000 0 0 139,000 38,000 538,000
President and C.E.O. 1992 223,000 168,000 26,000 0 31,993 42,000 28,000 433,000
PCS PrimeCo, L.P.
</TABLE>
- ---------------
(1) Prior to April 1, 1994, the Company was an 86.1% owned subsidiary of Telesis
from which it was spun off on April 1, 1994. Prior to the Spin-off,
including the years 1993 and 1992 and the period January 1, 1994 through
April 1, 1994, all payments to the Named Executive Officers, except for Mrs.
Gill and Mr. Schmitt (who was an employee of the Company prior to the
Spin-off), were made by Telesis. Mrs. Gill joined the Company January 1994
and thus received no payments from Telesis in 1992 or 1993.
(2) Aggregate number of unvested shares of restricted stock and their value at
fiscal year end ($29.125 per share) are as follows: Mr. Ginn -- 40,000
shares, $1,165,000; which vest with respect to 10,000 shares on 11/18/96,
10,000 shares on 11/18/97, 10,000 shares on 11/18/98 and 10,000 shares on
11/18/99. Mr. Cox -- 20,000 shares, $582,500; and Mr. Sarin -- 20,000
shares, $582,500. Includes Phantom Stock Units ("Units") which were
converted in connection with the Spin-off from awards originally granted
under the Telesis Long Term Incentive Plan for the completed portion of the
three-year performance cycles ending December 31, 1994 and December 31,
1995. Units convert on a one for one basis into Common Stock of the Company.
Awards for the three-year performance cycle ending December 31, 1994 settled
on January 27, 1995 as follows: Mr. Ginn -- 31,248 Units; Mr. Cox -- 14,904
Units; Mr. Christensen -- 8,052 Units, which were deferred under the
Company's Deferred Compensation Plan; Mr. Sarin -- 3,990 Units; and Mr.
Schmitt -- 4,082 Units. Awards for the three-year performance cycle ending
December 31, 1995 will settle on January 26, 1996 as follows: Mr.
Ginn -- 17,092 Units; Mr. Cox -- 7,938 Units; Mr. Christensen -- 4,607
Units; Mr. Sarin -- 2,231 Units; and Mr. Schmitt -- 2,488 Units.
10
<PAGE> 13
(3) For 1994, includes non-qualified stock options which were granted for the
uncompleted portions of both performance cycles, as described in footnote
(2) above, as follows: Mr. Ginn -- 98,000 shares; Mr. Cox -- 45,900 shares;
Mr. Christensen -- 26,100 shares; Mr. Sarin -- 12,800 shares; and Mr.
Schmitt -- 13,300 shares. For 1994, excludes options and SARs granted in
connection with the Spin-off as replacements for options previously granted
to such individuals by Telesis ("Replacement Options"). For 1992, options
reported reflect a conversion adjustment from pre-Spin-off shares to
post-Spin-off shares.
(4) Includes "above-market" interest on deferred compensation under the Telesis
Executive Deferral Plan for 1994 for each of the Named Executive Officers:
$119,849, $88,079, $58,553, $0, $19,141 and $34,563, respectively. Also
includes Company contributions under the Company's Retirement Plan or the
Telesis Supplemental Retirement and Savings Plan for Salaried Employees for
Mr. Christensen -- $5,644; Mrs. Gill -- $6,998; Mr. Sarin -- $7,157; and Mr.
Schmitt -- $13,268. Also includes Company contributions under the Company's
Deferred Compensation Plan and the Telesis Executive Deferral Plan for 1994
for each of the Named Executive Officers: $59,201, $41,051, $26,667, $1,872,
$11,508 and $24,809, respectively. For Mr. Schmitt, also includes Company
payments of $25,589 that replace retirement benefits lost on account of the
cessation of accruals under the Company's Pension Plan in 1987 and Company
contributions of $8,851 under the AirTouch Communications Excess Benefit
Plan.
(5) Includes Salary, Bonus and LTIP Payouts.
(6) Mr. Schmitt is Vice President of the Company and in November 1994 was named
President and C.E.O. of PCS PrimeCo, L.P., the Company's joint venture with
U S West Inc., Bell Atlantic Corporation and NYNEX Corporation. Mr. Schmitt
was a member of the Company's executive management group until January 15,
1995.
11
<PAGE> 14
The following table provides information on stock option grants during
fiscal year 1994 to the Named Executive Officers. For additional information
regarding stock options which expire on March 31, 2001, please refer to
footnotes (2) and (3) of the Summary Compensation Table.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZED VALUE
AT ASSUMED ANNUAL
RATES OF STOCK PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM
- --------------------------------------------------------------------------------- ------------------------
NUMBER OF
SECURITIES % OF TOTAL
UNDERLYING OPTIONS/SARS
OPTIONS/ GRANTED TO EXERCISE OR
SARS EMPLOYEES IN BASE PRICE EXPIRATION
NAME GRANTED (#)(1) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
- --------------------- -------------- ------------ ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Sam Ginn............. 98,000 1.59% $20.875 03/31/01 $ 832,440 $1,939,796
300,000 4.87 20.375 04/03/01 2,487,251 5,795,923
C. Lee Cox........... 45,900 0.75 20.875 03/31/01 389,888 908,537
150,000 2.44 20.375 04/03/01 1,243,626 2,897,962
Lydell L.
Christensen... 26,100 0.43 20.875 03/31/01 221,701 516,619
75,000 1.22 20.375 04/03/01 621,813 1,448,981
Margaret G. Gill..... 60,000 0.97 20.375 04/03/01 497,450 1,159,185
Arun Sarin........... 12,800 0.21 20.875 03/31/01 108,727 253,361
60,000 0.97 20.375 04/03/01 497,450 1,159,185
George F. Schmitt.... 13,300 0.22 20.875 03/31/01 112,974 263,258
45,000 0.73 20.375 04/03/01 373,088 869,388
</TABLE>
- ---------------
(1) Does not include Replacement Options.
The following table provides information on the value of each of the Named
Executive Officer's unexercised options/SARs at December 31, 1994. None of the
Company's Named Executive Officers exercised any stock options during 1994.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES(1)
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS/SARS AT OPTIONS/SARS
FY-END (#) AT FY-END ($)*
-------------------- ---------------------
EXERCISABLE/ EXERCISABLE/
NAME UNEXERCISABLE UNEXERCISABLE
------------------------------------ -------------------- ---------------------
<S> <C> <C>
Sam Ginn............................ 410,000/398,000 $5,184,648/$3,433,500
C. Lee Cox.......................... 228,872/195,900 $2,626,365/$1,691,175
Lydell L. Christensen............... 58,449/101,100 $ 705,621/$ 871,575
Margaret G. Gill.................... 0/ 60,000 $ 0.0/$ 525,000
Arun Sarin.......................... 51,189/ 72,800 $ 587,688/$ 630,600
George F. Schmitt................... 51,189/ 58,300 $ 587,688/$ 503,475
</TABLE>
- ---------------
(1) Includes Replacement Options.
* Based on the closing price on the New York Stock Exchange-Composite
Transactions of the Company's Common Stock on December 30, 1994 of $29.125
per share.
12
<PAGE> 15
EMPLOYEE STOCK PURCHASE PLAN
The Company maintains an Employee Stock Purchase Plan (the "ESPP") to
provide its employees, including officers, with an opportunity to purchase
Common Stock on favorable terms through payroll deductions. Under the ESPP,
2,400,000 shares of Common Stock have been reserved for issuance. The closing
market price of the Company's Common Stock was $26.75 per share as of March 1,
1995.
The ESPP became effective on July 1, 1994, and will remain in effect until
it is terminated by the Board. The ESPP may be amended by the Board at any time.
An increase in the number of shares reserved for issuance under the ESPP must be
approved by the stockholders, while other amendments are subject to stockholder
approval only to the extent required by applicable law or regulation. The ESPP
is administered by the C&P Committee.
An employee of the Company or one of its subsidiaries who is eligible to
contribute to the Company's Retirement Plan is also eligible to participate in
the ESPP. Any other employee is eligible to participate in the ESPP if he or she
is customarily employed for more than five months per year and for more than 20
hours per week and has been continuously employed by the Company or a subsidiary
for six months or more. Eligible employees may elect to contribute from 2% to
25% of their compensation (including team awards and commissions) during each
three-month offering period.
At the end of each offering period, the Company will apply the amount
contributed by the participant during the period to purchase shares of Common
Stock, but not more than 2,000 shares per offering period or $25,000 in market
value in a calendar year. Shares of Common Stock are purchased for 85% of the
lower of (a) the market price of the Common Stock immediately before the
beginning of the offering period or (b) the market price of such Common Stock on
the last business day in the offering period.
As of March 1, 1995, 3,830 employees were eligible to participate in the
ESPP and 1,303 employees had elected to participate. The following table sets
forth (a) the number of shares of Common Stock purchased under the ESPP during
the six-month period from the inception of the ESPP to December 31, 1994, (b)
the aggregate purchase price thereof and (c) the aggregate value of the shares
purchased as of the date of purchase.
<TABLE>
<CAPTION>
NUMBER OF PURCHASE VALUE OF
SHARES PRICE OF SHARES
NAME PURCHASED SHARES PURCHASED
---------------------------------------- --------- ---------- ----------
<S> <C> <C> <C>
Sam Ginn................................ 0 0 0
C. Lee Cox.............................. 0 0 0
Lydell L. Christensen................... 1,023 $ 21,250 $ 29,363
Margaret G. Gill........................ 267 $ 6,500 $ 7,781
Arun Sarin.............................. 784 $ 17,250 $ 22,619
George F. Schmitt....................... 0 0 0
All current executive officers as a
group (8 persons)..................... 3,042 $ 66,250 $ 87,698
All participants other than executive
officers as a group (1,140 persons)... 134,515 $2,977,451 $3,882,999
</TABLE>
Directors who are not executive officers may not participate in the ESPP.
The number of shares that may be purchased under the ESPP in 1995 and subsequent
years depends on the amount contributed by participants and is not determinable
at this time.
PENSION PLAN
In connection with the Spin-off, the Company's qualified and nonqualified
pension plans generally assumed liability for accrued benefits of the Named
Executive Officers under Telesis qualified and nonqualified pension plans.
("Qualified pension plans" are plans that are intended to qualify for
preferential tax treatment under section 401(a) of the Internal Revenue Code of
1986.) Corresponding assets were
13
<PAGE> 16
transferred from the Telesis plans to the Company's plans. Mrs. Gill is not
eligible to participate in the Company's qualified and nonqualified pension
plans. Mr. Ginn does not participate in the Company's nonqualified pension
plans.
As is the case with most of the Company's employees, none of the Named
Executive Officers any longer accrues a benefit under the Company's qualified
pension plan related to service with the Company. Increases in compensation
continue to produce increased accruals under the qualified pension plan.
The following table shows the total annual pension benefits (stated as a
single-life annuity) that would be received by an executive officer of the
Company retiring today at age 65 under the Company qualified and nonqualified
pension plans. It assumes various specified levels of total years of service and
average annual compensation (which includes base salary and the standard award
under the Short-Term Incentive Plan) during the final five years of service. The
benefits shown in the table generally are not subject to offsets for Social
Security benefits or other payments.
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
-------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
AVERAGE ANNUAL
COMPENSATION DURING
FINAL FIVE YEARS OF
SERVICE YEARS OF SERVICE PRIOR TO RETIREMENT
<S> <C> <C> <C> <C> <C> <C>
-------------------------------------------------------------------------------------
15 20 25 30 35
-------------------------------------------------------------------------------------
$ 300,000 65,250 87,000 108,750 130,500 152,250
-------------------------------------------------------------------------------------
350,000 76,125 101,500 126,875 152,250 177,625
-------------------------------------------------------------------------------------
400,000 87,000 116,000 145,000 174,000 203,000
-------------------------------------------------------------------------------------
450,000 97,875 130,500 163,125 195,750 228,375
-------------------------------------------------------------------------------------
500,000 108,750 145,000 181,250 217,500 253,750
-------------------------------------------------------------------------------------
550,000 119,625 159,500 199,375 239,250 279,125
-------------------------------------------------------------------------------------
650,000 141,375 188,500 235,625 282,750 329,875
-------------------------------------------------------------------------------------
700,000 152,250 203,000 253,750 304,500 355,250
-------------------------------------------------------------------------------------
800,000 174,000 232,000 290,000 348,000 406,000
-------------------------------------------------------------------------------------
900,000 195,750 261,000 326,250 391,500 456,750
-------------------------------------------------------------------------------------
1,000,000 217,500 290,000 362,500 435,000 507,500
-------------------------------------------------------------------------------------
1,200,000 261,000 348,000 435,000 522,000 609,000
-------------------------------------------------------------------------------------
</TABLE>
The 1994 compensation of Messrs. Ginn, Cox, Christensen, Sarin and Schmitt
covered by the pension plans was $150,000, $743,750, $425,000, $336,750 and
$353,125, respectively. As of December 31, 1994, the years of service of Messrs.
Ginn, Cox, Christensen, Sarin and Schmitt for purposes of calculating a pension
benefit, were 34, 30, 7, 9 and 29, respectively. (Because Mr. Christensen is
covered under a nonqualified pension plan providing increased pension benefits
to mid-career hires, his pension is effectively calculated as if he had 12 years
of service.)
Under one of the Company's nonqualified pension plans, eligible officers
who terminate after attaining age 55 and completing 10 years of service as an
officer are entitled to a minimum pension of 45% of average annual compensation.
This minimum pension is increased by an additional 1% per year, up to a maximum
of 50% at 15 or more years of service as an officer. As is required under
special terms of his employment contract, the age-55 threshold for eligibility
for the minimum pension benefit is waived for Mr. Cox if his employment is
involuntarily terminated for any reason other than cause, death or disability.
As of December 31, 1994, the completed years of service of Messrs. Cox,
Christensen, Sarin and Schmitt that are credited under the minimum pension
provisions were 10, 7, 5 and 8, respectively.
The Company has entered into a separate agreement with Mr. Christensen that
provides for special minimum benefits under the Company's pension plans in the
event of his termination of employment, for any reason, before October 1, 1997.
If termination occurs before October 1, 1995, Mr. Christensen's aggregate
pension benefit is guaranteed not to be less than 25% of his average annual
compensation, reduced by 0.833% times the number of months before October, 1995,
that payment is made. If termination occurs on or after October 1, 1995, but
before October 1, 1997, the aggregate pension benefit is guaranteed not to be
less than
14
<PAGE> 17
45% of his average annual compensation, reduced by 0.375% times the number of
months before October, 1997, that payment is made.
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT OR CHANGE-IN-CONTROL
ARRANGEMENTS
The Company has entered into employment agreements with each of the Named
Executive Officers that provide for specified payments in case of termination of
employment and, in Mr. Christensen's case, for certain relocation benefits. Mrs.
Gill's employment agreement provides that Mrs. Gill is entitled to a minimum
guaranteed aggregate amount of salary and Short-Term Incentive Plan bonus of
$400,000 in each of the years 1994 and 1995. The agreements were approved by the
C&P Committee. The employment agreements have no fixed term and may be
terminated by either party upon one year's notice.
The amount payable upon termination of employment depends upon the type of
termination and whether it occurs after a "change in control." Regardless of
whether there has been a change in control, if an officer's employment is
involuntarily terminated for any reason other than cause, death or disability,
the Company will make a cash payment equal to one times base compensation, plus
100% of the standard award under the Short-Term Incentive Plan for that calendar
year. Also, the officer's health care and life insurance benefits are continued
for one year and, in the case of all of the Named Executive Officers except Mr.
Schmitt, the one-year period following termination counts as service for
purposes of vesting and exercise grace periods under all of the Company's
option, restricted stock and incentive plans. In addition, Mr. Cox will be
entitled to special eligibility terms for a minimum pension benefit, as is
discussed under "Pension Plan."
If the officer's employment ends in a "qualifying termination" within three
years after a "change in control," the Company will make a cash payment equal to
one times base compensation, plus 100% of the standard award under the
Short-Term Incentive Plan for that calendar year. For Messrs. Ginn, Cox,
Christensen and Sarin, and Mrs. Gill, the payment in these circumstances is
equal to two times base compensation, plus 200% of the standard award under the
Short-Term Incentive Plan for that calendar year. If the qualifying termination
within three years after a change in control is a termination by the Company for
any reason other than cause, death or disability, these payments are in addition
to the payment that is usually made in these circumstances.
A "qualifying termination" is an involuntary termination by the Company for
any reason, or a "constructive termination," which means a material reduction in
salary or benefits, a material change in responsibilities, or a requirement to
relocate that would increase the officer's one-way commute distance by more than
40 miles. For Messrs. Ginn, Cox, Christensen and Sarin, and Mrs. Gill, a
"qualifying termination" also includes a voluntary termination during the 13th
month after the change in control.
A "change in control" is defined generally as (1) the acquisition of 50% or
more of the securities of the Company; (2) a change in the composition of the
Company's Board of Directors so that fewer than two-thirds of the directors are
"continuing directors"; (3) direct or indirect acquisition of 20% or more of the
securities of the Company without the approval of a majority of the continuing
directors; or (4) certain mergers, consolidations, sales or liquidations of
substantially all of the assets of the Company.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company has provided a $100,000 loan to Mr. Hazen under the Company's
equity purchase program, to finance the purchase of $100,000 worth of the
Company's Common Stock. The term of the loan is five years, with an option to
extend for an additional five years. Final maturity is ten years or, if earlier,
30 days following the borrower's resignation from the Board, no interim payments
are otherwise due. The interest rate for such loan is 6%, which was established
at the time the loan was made and will be reset if the loan is renewed for an
additional five years. The interest rate was determined using the greater of the
mid-term, adjusted Applicable Federal Rate, as published by the Internal Revenue
Service, or the Company's cost of funds, currently equivalent to the five-year
Treasury rate plus 85 basis points, but in no event higher than permitted under
the California usury laws (10%). Interest will compound annually and be paid at
the end of each five-year term. The principal and interest balance at December
31, 1994 was $106,000.
15
<PAGE> 18
Mrs. Gill's sister-in-law is Vice President and General Counsel of U.S.
Computer Services. AirTouch Paging, a subsidiary of the Company, entered into an
agreement with U.S. Computer Services d/b/a International Billing Services on
January 23, 1995 (the "Agreement"). The Agreement provides for printing and
mailing services of monthly billing statements to customers of AirTouch Paging.
The Agreement is for a five-year term with approximately $1.2 million in minimum
annual fees.
Mr. Rock's wife is a partner in the law firm of Pillsbury Madison & Sutro,
which provides legal services to the Company and certain of its subsidiaries.
Approximately $34.2 million was paid by the Company to Telesis during the
first quarter of 1994, during which time Telesis was the Company's majority
shareholder. Such payments were made pursuant to the Separation Agreement
between the Company and Telesis for costs and reimbursements related to the
Spin-off. Approximately $661,000 was received by the Company from Telesis in
1994 for payment of services performed by the Company's Technology Planning and
Development department.
PROPOSAL 2
RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors, upon recommendation of the Audit Committee, has
appointed the firm of Coopers & Lybrand L.L.P., Certified Public Accountants, as
independent accountants to audit the financial statements of the Company for
1995. The Board of Directors recommends that the stockholders vote "FOR" such
ratification. If the stockholders do not ratify this appointment, other
certified public accountants will be considered by the Board of Directors upon
recommendation of the Audit Committee.
For the year 1994, Coopers & Lybrand L.L.P. audited the financial
statements of the Company and some of its subsidiaries, and provided other audit
services to the Company in connection with Securities and Exchange Commission
("SEC") filings, the review of interim financial statements and audits of
pension and other employee benefit plans.
One or more members of the firm are expected to be present at the Meeting
and will have the opportunity to make a statement if they desire to do so and to
respond to appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF COOPERS
AND LYBRAND L.L.P.
OTHER MATTERS
The proxy card, in addition to voting choices specifically marked, and
unless otherwise indicated by the stockholder, confers discretionary authority
on the named proxy holders to vote on any matter that properly comes before the
Meeting which is not described in these proxy materials. At the time this proxy
statement went to press, the Company knew of no other matters which might be
presented for stockholder action at the Meeting.
To be eligible for inclusion in the Company's 1996 proxy statement,
stockholder proposals must be received at the Company's principal executive
offices no later than December 11, 1995.
If a stockholder desires to bring business before the Meeting which is not
the subject of a proposal timely submitted for inclusion in the proxy statement,
the stockholder must follow procedures outlined in the Company's By-Laws. A copy
of these procedures is available upon request from the Secretary of the Company,
One California Street, San Francisco, California 94111. One of the procedural
requirements in the By-Laws is timely notice in writing of the business the
stockholder proposes to bring before the Meeting. Notice must be received no
less than 35 days nor more than 60 days prior to the Meeting. It should be noted
that these By-Law procedures govern proper submission of business to be put
before a stockholder vote and do not preclude discussion by any stockholder of
any business properly brought before the Meeting.
If a stockholder wants to nominate a person for election to the Board of
Directors other than a director nominated by the Nominating Committee, notice of
the proposed nomination must be delivered to or mailed
16
<PAGE> 19
and received by the Secretary of the Company not less than 35 days prior to the
Meeting. A copy of the By-Law provisions governing the requirements for the
notice is available upon request from the Secretary of the Company.
COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
Section 16(a) of the Securities Exchange Act of 1934 requires certain
persons, including the Company's directors and officers to file reports of
ownership and changes in ownership of the Company's securities with the SEC.
Based upon the Company's review of the reporting forms received by it and
written representations from certain persons that no Form 5 reports were
required to be filed by those persons, the Company believes that all filing
requirements applicable to its directors, officers and 10% stockholders were
complied with for fiscal year 1994, except that (i) Mr. Ginn's three childrens'
trusts, of which Mr. Ginn is the trustee, inadvertently filed their Forms 3
late. The Forms were due when the trusts received Company stock pursuant to the
Company's Spin-off from Telesis; (ii) Mr. Fisher and his charitable trust
inadvertently reported late on their Form 4 and Form 3, respectively, an
acquisition of Company stock by the charitable trust in August 1994; (iii) Mr.
Neels inadvertently filed his Form 4 for the month of December 1993 one day late
reporting an acquisition of Company securities; and (iv) due to an error on the
part of the Company's outside administrator of the ESPP, Mrs. Gill's Form 5
failed to reflect an acquisition on December 30, 1994 of shares of Common Stock
under the ESPP. Mrs. Gill has amended her Form 5.
SOLICITATION OF PROXIES
The Company will pay all costs of distribution and solicitation of proxies.
Brokers, nominees, fiduciaries and other custodians will be reimbursed their
reasonable fees and expenses incurred in forwarding proxy materials to
beneficial owners. Georgeson & Co., New York, has been retained at an estimated
cost of $16,000, plus reasonable out-of-pocket expenses, to assist in the
solicitation of proxies. This solicitation will be by mail, telephone, and other
means.
By Order of the Board of Directors,
[SIG]
Margaret G. Gill
Senior Vice President
Legal, External Affairs and Secretary
17
<PAGE> 20
(LOGO) Printed on Recycled Paper
<PAGE> 21
[AIRTOUCH COMMUNICATIONS LOGO]
Sam Ginn
Chairman and Chief Executive Officer
April 1995
Dear Stockholder:
Enclosed is AirTouch Communications' 1994 Annual Report and Proxy
Statement relating to our 1995 Annual Stockholders' Meeting. This has
been a remarkable year for AirTouch and our Annual Report reviews our
accomplishments and shares our vision for the future.
The 1995 Annual Meeting will be in San Francisco on Thursday, May 18 at
10:30 a.m. The location is the San Francisco Fashion Center. If you plan
to attend, be sure to bring the admission ticket to the meeting. The
admission ticket and directions to the location are printed on the back of
this form.
Your vote is important to us, so whether or not you plan to attend the
meeting, please take time to complete and return the attached proxy card.
Sincerely,
/s/ Sam Ginn
------------
Sam Ginn
DETACH PROXY CARD HERE
================================================================================
<TABLE>
<S> <C>
1. Election of Directors 2. Ratification of the
The Board of Directors recommends appointment of auditors. The
a vote "FOR" the nominees listed below: Board of Directors recommends
(Nominees: Donald G. Fisher, Sam Ginn, a vote "FOR" the appointment
Charles R. Schwab) of auditors.
For [ ] Withheld [ ] Exceptions* [ ] For [ ] Against [ ]
Abstain [ ]
* Exceptions..............................
</TABLE>
Check here if you
To vote your shares for all Director * plan to attend the [ ]
nominees, mark the "For" box on Item 1. Annual Meeting
To withhold your votes for all nominees, * have a change of address [ ]
mark the "Withheld" box. If you do not on this card (Indicate
wish your shares voted for a particular address change below)
nominee, mark the "Exceptions" box and * want your vote kept [ ]
enter the name(s) of the exception(s) in confidential
the space provided. Such a mark will be
deemed a vote "FOR" all nominees other
than those listed as exceptions.
3. In their discretion, the Proxies are
authorized to vote upon such other
business as may properly come before
the meeting or any adjournment or
postponement thereof.
Please sign name exactly as it
appears on this card. Joint
owners should each sign.
Attorneys, trustees, executors,
administrators, custodians,
guardians or corporate officers
should give full title.
DATE __________________________
SIGNATURE _____________________
SIGNATURE _____________________
Votes MUST be indicated
Sign, Date and Return the Proxy Card (x) in Black or Blue ink.
Promptly Using the Enclosed Envelope.
<PAGE> 22
================================================================================
[AIRTOUCH COMMUNICATIONS LOGO]
PROXY/VOTING INSTRUCTION CARD
--------------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF AIRTOUCH COMMUNICATIONS, INC.
FOR THE ANNUAL MEETING ON MAY 18, 1995
I(we) hereby authorize Sam Ginn or Margaret G. Gill, or one of them,
and each with the power to appoint his or her substitute, to vote as
Proxy for me(us) at the Annual Meeting of Stockholders to be held at
The Fashion Center, 699 Eighth Street, San Francisco, CA 94103 on
May 18, 1995 at 10:30 AM, or any adjournment or postponement thereof,
the number of shares which I(we) would be entitled to vote if
personally present. The proxies shall vote subject to the directions
indicated on the reverse side of this card and proxies are authorized
to vote in their discretion upon such other business as may properly
come before the meeting and any adjournments or postponements thereof.
The proxies will vote as the Board of Directors recommends where I
(we) do not specify a choice.
THIS CARD ALSO CONSTITUTES YOUR VOTING INSTRUCTIONS FOR SHARES HELD
OF RECORD IN THE AIRTOUCH COMMUNICATIONS, INC. RETIREMENT PLAN, THE
PACIFIC TELESIS GROUP SUPPLEMENTAL RETIREMENT AND SAVINGS PLAN FOR
SALARIED EMPLOYEES AND THE PACIFIC TELESIS GROUP SUPPLEMENTAL
RETIREMENT AND SAVINGS PLAN FOR NON-SALARIED EMPLOYEES (THE "PLANS")
AND I HEREBY AUTHORIZE THE RESPECTIVE TRUSTEES OF THE PLANS TO VOTE
MY SHARES HELD IN MY ACCOUNTS.
(To be continued and signed AirTouch Communications, Inc.
on the reverse side.) P.O. BOX 11998
NEW YORK, NY 10203-0998
