[LOGO]
WIRELESS ONE, INC.
11301 Industriplex, Suite 4
Baton Rouge, Louisiana 70809-4115
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Stockholders of Wireless One, Inc.:
The annual meeting of stockholders of Wireless One, Inc. (the
"Company") will be held at the Company's corporate headquarters, 11301
Industriplex, Suite 4, Baton Rouge, Louisiana 70809-4115, on May 20,
1997, at 10:00 a.m., local time, to consider and vote on:
1. The election of three directors.
2. Such other business as may properly come before the meeting or
any adjournments thereof.
Only holders of record of the Company's Common Stock at the close of
business on April 1, 1997, are entitled to notice of and to vote at the
annual meeting.
PLEASE SIGN AND DATE THE ENCLOSED PROXY AND RETURN IT IN THE
ACCOMPANYING ENVELOPE AS PROMPTLY AS POSSIBLE. A PROXY MAY BE REVOKED AT
ANY TIME PRIOR TO THE VOTING THEREOF.
By Order of the Board of Directors
/s/ Henry G. Schopfer III
Henry G. Schopfer III
Secretary
Baton Rouge, Louisiana
April 18, 1997
WIRELESS ONE, INC.
11301 Industriplex, Suite 4
Baton Rouge, Louisiana 70809-4115
PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 20, 1997
This Proxy Statement is furnished to stockholders of Wireless One,
Inc. (the "Company") in connection with the solicitation on behalf of its
Board of Directors (the "Board") of proxies for use at the annual meeting
of stockholders of the Company to be held on May 20, 1997, at the time
and place set forth in the accompanying notice and at any adjournments
thereof (the "Meeting").
Only stockholders of record of the Company's common stock, $0.01 par
value per share ("Common Stock"), at the close of business on April 1,
1997, are entitled to notice of and to vote at the Meeting. On that
date, the Company had outstanding 16,946,697 shares of Common Stock, each
of which is entitled to one vote.
The enclosed proxy may be revoked at any time prior to its exercise
by filing with the Secretary of the Company a written revocation or duly
executed proxy bearing a later date. The proxy will also be deemed
revoked with respect to any matter on which the stockholder votes in
person at the Meeting. Attendance at the Meeting will not in and of
itself constitute a revocation of a proxy. Unless otherwise marked,
properly executed proxies in the form of the accompanying proxy card will
be voted for the election of the three nominees to the Board listed
below.
This Proxy Statement is first being mailed to stockholders on or
about April 18, 1997. The cost of soliciting proxies hereunder will be
borne by the Company. Proxies may be solicited by mail, personal
interview, telephone and telegraph. Banks, brokerage houses and other
nominees or fiduciaries will be requested to forward the soliciting
material to their principals and to obtain authorization for the
execution of proxies. The Company will, upon request, reimburse them for
their expenses in so acting.
ELECTION OF DIRECTORS
General
The Board currently is comprised of nine directors divided into
three classes. The members of each class serve three-year staggered
terms with one class to be elected at each annual meeting. The terms of
Messrs. Luby, Holland and Van Devender will expire at the Meeting.
Accordingly, proxies cannot be voted for more than three nominees.
Unless authority to vote for the election of directors is withheld,
the proxies solicited hereby will be voted FOR the election of each
individual named under "Nominees" below. If any nominee should decline
or be unable to serve for any reason, votes will instead be cast for a
substitute nominee designated by the Board. The Board has no reason to
believe that any nominee will decline to be a candidate or, if elected,
will be unable or unwilling to serve. Under the Company's by-laws,
directors are elected by a plurality vote.
Chase Manhattan Capital Corporation ("CMCC"), Chase Venture Capital
Associates, L.P. ("CVCA"), Baseball Partners, Heartland Wireless
Communications, Inc. ("Heartland"), Mississippi Wireless TV, L.P.
("MWTV"), VanCom, Inc. ("VanCom"), Vision Communications, Inc. ("VCI")
and Messrs. Burkhalter and Bill Byer and certain other former executives
of TruVision Wireless, Inc. ("TruVision"), all of whom collectively
beneficially own 54.3.% of the outstanding Common Stock, are parties to a
stockholders' agreement with respect to their shares of Common Stock (the
"Agreement"). Pursuant to the Agreement, these shareholders have agreed
to vote their shares of Common Stock so that the Board will have up to
nine members, up to three of whom will be designated by Heartland (at
least one of whom must be independent of Heartland and the Company), up
to two of whom will be designated by CMCC, Baseball Partners and CVCA
(collectively, "Chase"), and one of whom will be designated by VanCom,
MWTV, VCI, Messrs. Burkhalter and Byer and certain former executives of
TruVision (collectively, the "TruVision Stockholders"), and that Mr.
Burkhalter will be elected Vice Chairman of the Board. The Board has
traditionally nominated the persons nominated by these shareholders. The
remaining directors are designated by the full Board. Of the current
directors, Mr. Burkhalter serves as the nominee of the TruVision
Stockholders, Messrs. Wheeler, Holland and Shimer serve as the nominees
of Heartland and Messrs. Chavkin and Van Devender serve as the nominees
of Chase. Messrs. Sternberg, Reilly and Luby were originally nominated
by certain other stockholders of the Company, including Messrs. Sternberg
and Reilly, who were parties to the Agreement prior to September 1996
when the Agreement was amended to remove these stockholders. Messrs.
Sternberg, Reilly and Luby now serve as nominees of the full Board.
The Board has nominated and urges you to vote FOR the election of
Messrs. Luby, Holland and Van Devender.
Information, as of April 1, 1997 regarding the nominees for re-
election to the Board is set forth below:
Nominees Age Position
------------------------- --- --------
William K. Luby (1)(2)(3) 37 Director
J. R. Holland, Jr. (1)(2) 53 Director
William J. Van Devender(3) 48 Director
Information, as of April 1, 1997, regarding the remaining directors
of the Company is set forth below:
Directors Age Position
- ------------------------ --- ----------------------------------------
Henry M. Burkhalter 48 President and Vice Chairman of the Board
Sean E. Reilly 36 Chief Executive Officer and Director
Daniel L. Shimer(2) 52 Director
Hans J. Sternberg(1) 61 Chairman of the Board
Arnold L. Chavkin(1)(3) 45 Director
L. Allen Wheeler 64 Director
______________________
(1) Member of Operating Committee.
(2) Member of Compensation Committee.
(3) Member of Audit Committee.
Director Nominees (Class II Directors) (term expiring at the 2000 annual
meeting)
William K. Luby became a director of the Company in June 1995 and a
director of the Company's predecessor ("Old Wireless One") in April 1995.
Since October 1996, Mr. Luby has been a partner in CEA Capital Partners,
USA L.P., a private equity investor. From April 1996 to October 1996, he
served as President of Two River Capital. From June 1992 to March 1996,
Mr. Luby was a managing director at CMCC. From 1985 to 1992, Mr. Luby
held various positions in the Leveraged Lending and Restructuring groups
at The Chase Manhattan Bank, N.A.
J. R. Holland, Jr. became a director of the Company in June 1995.
Mr. Holland served as Chairman of the Board of Directors of Heartland
from October 1993 to March 1997. Mr. Holland remains a director of
Heartland. Mr. Holland has been employed as President of Unity Hunt,
Inc., a private holding company with interests in entertainment, cable
television, retail, investments, real estate, natural resources and
energy businesses, since September 1991. Mr. Holland is also the
President of Hunt Capital, a principal stockholder of Heartland. Mr.
Holland is currently a director of Optical Securities, Inc. and TNP
Enterprises, Inc.
William J. Van Devender became a director of the Company in July
1996. Mr. Van Devender had been a director of TruVision since August
1994. He controls VanCom, a limited partner of MWTV. In addition, Mr.
Van Devender has founded or served in senior executive positions with Van
Petroleum, Inc., Green Acres Farms, Inc., Gulf Coast Plywood, Inc. and
Coastal Paper Company. Mr. Van Devender also serves on the Board of
Directors of Alaska-3 Cellular LLC, CelluTissue Holdings, Inc. and
Pacificom LLC, and various bank and community organizations.
Class III Directors (term expiring at the 1998 annual meeting)
Henry M. Burkhalter became a director of the Company in April 1996
and President of the Company and Vice Chairman of the Board in July 1996.
Mr. Burkhalter had been Chairman of the Board of Directors, President and
Chief Executive Officer of TruVision since its incorporation in April
1994. He has also served as the Chairman of Pacific Coast Paging, Inc.
since 1990.
Sean E. Reilly has served as Chief Executive Officer and a director
of the Company since its founding in June 1995 and as Chief Executive
Officer and President of Old Wireless One since its founding in late
1993. Prior to joining Old Wireless One, Mr. Reilly served as Vice-
President of Real Estate/Mergers and Acquisitions of Lamar Advertising
Company, a publicly-traded outdoor advertising company. Mr. Reilly
served in the Louisiana Legislature as a State Representative from March
1988 to January 1996.
Daniel L. Shimer became a director of the Company in February 1996.
Mr. Shimer is President of Shimer Capital Partners, Inc., a financial
consulting and merchant banking company started in September 1996. From
April 1994 to September 1996, he served as Executive Vice President and
Chief Financial Officer of COREStaff, Inc., a publicly-traded provider of
staffing services. From March 1991 to March 1994, Mr. Shimer served as
the Executive Vice-President and Chief Financial Officer of Brice Foods,
Inc., an international manufacturer and retailer of frozen dessert
products.
Class I Directors (term expiring at the 1999 annual meeting)
Hans J. Sternberg has served as Chairman of the Company since its
founding in June 1995 and as Chairman of the Board of Old Wireless One
since its founding in late 1993. He has also served as the Chairman and
Chief Executive Officer of Starmount Life Insurance Company since 1983.
He is a former owner and President and Chief Executive Officer of Maison
Blanche Department Stores, a department store chain.
Arnold L. Chavkin became a director of the Company in April 1996.
He has been a General Partner of Chase Capital Partners ("CCP") since
January 1992 and has served as the President of Chemical Investments,
Inc. since March 1991. Mr. Chavkin is a director of Reading & Bates
Corporation, American Radio Systems Corporation, Inc., Bell Sports, Inc.,
Envirotest Systems Corp., Forcenergy, Inc., American Tower Corp.
L. Allen Wheeler became a director of the Company in April 1997.
Mr. Wheeler was the co-founder of Heartland and has served as a director
of Heartland since its formation in September 1990. He served as Vice
Chairman of the Board of Directors of Heartland from February 1996 until
February 1997 and, from January 1997 to February 1997, as Heartland's
acting President and Chief Executive Officer. Mr. Wheeler has owned and
managed diversified investments through Allen Wheeler Management, Inc., a
personal holding company, for over 20 years.
During 1996, the Board held seven meetings. Each director attended
at least 75% of the aggregate number of meetings held during 1996 of the
Board and committees of which he was a member.
The Board has an Audit Committee, a Compensation Committee and an
Operating Committee. The Audit Committee, which met two times in 1996,
oversees the activities of the Company's independent auditors, including
approving the scope of the annual audit activities of the independent
auditors, and reviews audit results and the internal audit controls of
the Company. The Compensation Committee, which met two times in 1996, is
authorized to make recommendations to the Board with respect to general
employee benefit levels, determine the compensation and benefits of the
Company's executive officers and administer the Company's stock option
plans. The Operating Committee, which met four times in 1996, is
authorized to oversee the operations of the Company and to make reports
to the full Board. The Company does not have a nominating committee.
Compensation of Directors
Each non-employee director receives an annual fee of $5,000, plus
$500 for each Board meeting attended. All directors are reimbursed for
reasonable out-of-pocket expenses incurred in attending Board and
committee meetings. In addition, each non-employee Director (an
"Eligible Director") is eligible to receive stock options under the
Company's 1996 Non-Employee Directors' Stock Option Plan (the "Directors'
Plan"). The Company issued options to purchase 20,000 shares of Common
Stock under the Directors' Plan in 1996. Pursuant to the Directors'
Plan, each director who is an Eligible Director on each November 15 will
also be granted on the following January 1 options to purchase an
additional 2,000 shares of Common Stock.
STOCK OWNERSHIP OF DIRECTORS, EXECUTIVE OFFICERS
AND CERTAIN STOCKHOLDERS
The following table sets forth certain information as of April 1,
1997 with respect to the beneficial ownership of Common Stock of (i) each
director and nominee of the Company, (ii) each Named Executive Officer
(as hereinafter defined), (iii) all directors and executive officers of
the Company as a group and (iv) persons owning of record or known to the
Company to be the beneficial owner of more than five percent of the
Company's Common Stock determined in accordance with Rule 13d-3 under the
Securities Exchange Act of 1934. Unless otherwise indicated, the
securities are held with sole voting and investment power.
Common Stock(1)
----------------------
Number of Percent of
Name Shares Class
- ---- ---------- ----------
Heartland Wireless Communications, Inc.(2)............ 3,459,508 20.4%
Chase Manhattan Capital Corporation (3)............... 1,991,690 11.8%
Chase Venture Capital Associates L.P. (3)............. 1,517,979 9.0%
Baseball Partners (3)................................. 393,226 2.3%
Mississippi Wireless TV, L.P. (4)..................... 1,702,406 10.1%
VanCom, Inc. (5)...................................... 42,560 *
Henry M. Burkhalter (4)(6)............................ 1,884,339 11.1%
Hans J. Sternberg (7)................................. 449,700 2.9%
Sean E. Reilly (8).................................... 209,920 1.2%
Arnold L. Chavkin (9)................................. 3,902,895 23.0%
J. R. Holland, Jr. (10)............................... 3,459,508 20.4%
William K. Luby (11).................................. 393,226 2.3%
Daniel L. Shimer...................................... 4,800 *
William J. Van Devender (5)........................... 57,904 *
L. Allen Wheeler(12).................................. 3,459,508 20.4%
Alton C. Rye (13)..................................... 7,000 *
All Directors and executive officers as a
group (13 persons) (14)............................ 10,040,577 57.6%
____________________
* Less than one percent.
(1) Heartland and certain of its subsidiaries, CMCC, CVCA, Baseball
Partners, MWTV, VanCom, VCI, Mr. Burkhalter and certain executive
officers of the Company are parties to the Agreement, as amended. See
"Election of Directors - General." Each of the parties to the
Agreement disclaims beneficial ownership of the shares of Common Stock
owned by the other parties to the Agreement.
(2) Heartland reported on a Schedule 13G filed with the SEC on February 14,
1997, shared voting and dispositive power, as of December 31, 1996,
with respect to 3,259,508 shares of Common Stock. Shares listed for
Heartland also include 200,000 shares of Common Stock that were
distributed to Heartland from an escrow account established in October
1995 in connection with the Heartland Transaction (as defined herein).
The address for Heartland is 200 Chisholm Place, Suite 200, Plano,
Texas 75075.
(3) CMCC reported on a Schedule 13G filed with the SEC on February 13,
1997, shared voting and dispositive power, as of December 31, 1996,
with respect to 1,991,690 shares of Common Stock together with The
Chase Manhattan Bank, the direct parent of CMCC, and The Chase
Manhattan Corporation, the indirect parent of CMCC. In the same
filing, CVCA reported sole voting and dispositive power, as of December
31, 1996, with respect to 1,385,388 shares of Common Stock, and
Baseball Partners reported shared voting and dispositive power, as of
December 31, 1996, with respect to 393,226 shares of Common Stock.
Shares listed for CVCA also include 132,591 shares held in escrow for
CVCA that will be distributed in 1997. The address for CMCC, CVCA and
Baseball Partners is 380 Madison Avenue, 12th Floor, New York, New York
10017.
(4) The general partner of MWTV is Wireless TV, Inc. ("WTV"). Mr.
Burkhalter is the President and controlling stockholder of WTV. WTV
has the power to vote and dispose of the shares of Common Stock held by
MWTV. Therefore, Mr. Burkhalter may be deemed to beneficially own all
shares of Common Stock held by MWTV. Mr. Burkhalter disclaims
beneficial ownership of any such shares of Common Stock. The address
for MWTV and Mr. Burkhalter is c/o TruVision, 1080 River Oaks Drive,
Suite A150, Jackson, MS 39208.
(5) VanCom is the limited partner of MWTV and has a right to 22.9167% of
allocations and distributions from MWTV. Shares owned by Mr. Van
Devender include shares owned by VanCom, as Mr. Van Devender is the
President and controlling stockholder of VanCom. Mr. Van Devender's
address is c/o VanCom, Inc., P.O. Box 5327, Jackson, Mississippi
39296.
(6) Includes 12,288 owned by Mr. Burkhalter's wife and 78,015 shares
issuable upon the exercise of presently exercisable options.
(7) Includes 75,120 shares owned by Mr. Sternberg's wife and children and
148,444 shares issuable upon the exercise of presently exercisable
options.
(8) Includes 193,702 shares issuable upon the exercise of presently
exercisable options.
(9) Reflects 3,902,895 shares owned by CVCA, CMCC and Baseball Partners.
Mr. Chavkin is a general partner of CCP, the general partner of CVCA.
CCP has investment and voting discretion with respect to the shares
held by CMCC. Baseball Partners has granted a proxy with respect to
the shares of Common Stock held by it to CCP. Mr. Chavkin disclaims
beneficial ownership of the shares held by CVCA, CMCC and Baseball
Partners. The address for Mr. Chavkin is 380 Madison Avenue, 12th
Floor, New York, NY 10017.
(10) Includes 3,459,508 shares beneficially owned by Heartland. Mr. Holland
is the Manager and President of Hunt Capital Group, L.L.C., a principal
stockholder of Heartland. Mr. Holland is also a director of Heartland.
Mr. Holland disclaims beneficial ownership of shares owned by
Heartland. The address for Mr. Holland is 4000 Thanksgiving Tower,
Dallas, TX 75201.
(11) Reflects shares of Common Stock beneficially owned by Baseball
Partners. Mr. Luby is a general partner of Baseball Partners and
therefore may be deemed to be a beneficial owner of such shares. Mr.
Luby disclaims beneficial ownership of all of the shares of Common
Stock owned by Baseball Partners in which Mr. Luby has no pecuniary
interest. Certain affiliates of CMCC are general partners of Baseball
Partners.
(12) Includes 3,459,508 shares beneficially owned by Heartland. Mr. Wheeler
is a director of Heartland and disclaims beneficial ownership of shares
owned by Heartland. The address for Mr. Wheeler is c/o Heartland, 200
Chisholm Place, Suite 200, Plano, Texas 75075.
(13) Includes 6,000 shares issuable upon the exercise of currently
exercisable options.
(14) Includes 490,572 shares issuable upon the exercise of currently
exercisable options held by directors and executive officers.
EXECUTIVE COMPENSATION
Annual Compensation
The following table sets forth all cash compensation and options
granted for the three years ended December 31, 1996, to the Company's
Chief Executive Officer and its most highly compensated executive officer
(collectively, the "Named Executive Officers"). In 1996, no other
executive officer of the Company received more than $100,000 in salary
and bonus.
<TABLE>
<CAPTION>
Long-Term
Annual Compensation
Compensation Awards
---------------------- ------------
Securities
Underlying ALl Other
Name and Principal Position Year Salary Bonus Options(3) Compensation(4)
- --------------------------- ---- ------ ----- ---------- ---------------
<S> <C> <C> <C> <C> <C>
Sean E. Reilly, Chief 1996 $ 131,781 $ --- --- $ 4,442
Executive Officer 1995 $ 87,692 $ --- 201,395 $ ---
1994 $ 35,000(1) $ --- 113,144 $ ---
Alton C. Rye, Executive Vice 1996 $ 103,467 $ 15,000 --- $ 4,442
President - Operations 1995 $ 31,058(2) $ --- 10,000 $ ---
</TABLE>
________________________
(1) Mr. Reilly began receiving compensation from Old Wireless One on
June 1, 1994.
(2) Mr. Rye began receiving compensation from Old Wireless One on August
1, 1995.
(3) For additional information, please refer to the following table.
(4) Automobile allowance.
Stock Option Holdings
The following table sets forth information, as of December 31, 1996,
with respect to stock options held by the Named Executive Officers. The
Company did not grant any options to the Named Executive Officers in
1996, nor did the Named Executive Officers exercise any options to
purchase the Company's Common Stock in 1996.
Aggregate Fiscal Year-End
Option Values
Number of Securities Underlying Value of Unexercised
Unexercised Options at Fiscal In-the-Money Options
December 31, 1996 at December 31, 1996(1)
------------------------------- --------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ----------------- ----------- ------------- ----------- -------------
Sean E. Reilly(1) 125,815 188,724 $ 158,500 $ 0
Alton C. Rye(2) 6,000 24,000 0 0
________________________
(1) Mr. Reilly has the following currently exercisable options at the
following exercise prices: 45,257 at $6.21 per share, 40,279 at
$4.16 per share and 40,279 at $5.62 per share. Mr. Reilly also has
67,887 options, which are not currently exercisable, that have an
exercise price of $6.21 per share. The remainder of Mr. Reilly's
options will vest and become exercisable in three equal installments
over the next three years. Each installment will become exercisable
at an exercise price 35% higher than the prior year's installment.
(2) These options, all of which were granted on October 19, 1995, have a
ten-year term, an exercise price per share of $10.50 and become
exercisable in 20% annual increments on the anniversary of the date
of grant.
(3) The closing sale price of the Common Stock on December 31, 1996 was
$6.625 as reported by the Nasdaq National Market. The value of all
options is calculated on the basis of the difference between $6.625
and the respective exercise prices of the options.
Employment Agreements
The Company has entered into employment agreements with certain of
its executive officers, including Messrs. Burkhalter, Reilly, Byer and
Rye. The employment agreements provide for payment of a base salary
indexed to inflation and bonuses awarded at the sole discretion of the
Compensation Committee (the "Committee") and based upon the executive's
performance and the Company's operating results. Each agreement has a
two-year term and is subject to automatic annual renewal for a period of
seven years thereafter. Each employment agreement provides that each
executive may be terminated with or without cause, and provides that the
executive will not compete with the Company or its subsidiaries within a
specified area during the period of employment and for the two years
thereafter. Each executive is entitled to receive a severance payment in
the event of a resignation caused by the relocation of the Company's
office at which the executive is employed to a location more than 60
miles from its present location.
Compensation Committee Interlocks and Insider Participation
The members of the Compensation Committee are Messrs. Luby, Holland
and Shimer. No past or current officer or employee of the Company serves
on the Committee. During 1996, no executive officer of the Company
served as a member of the compensation committee or a director of an
entity, one of whose executive officers served on the Committee or as a
director of the Company.
Mr. Holland is a director of Heartland and the Manager and President
of Hunt Capital Group, L.L.C., a principal stockholder of Heartland. In
connection with the acquisition of certain assets from Heartland in
October 1995 (the "Heartland Transaction"), the Company entered into
certain non-competition and registration rights agreements with
Heartland. See "- Certain Relationships and Related Transactions."
Compensation Committee's Report on Executive Compensation
The Committee was established in connection with the Company's
initial public offering in October 1995. The Committee is authorized to
make recommendations to the Board of Directors with respect to general
employee benefit levels, determine the compensation and benefits of the
Company's officers and key employees and administer the Company's stock
option plans. The current members of the Committee are Messrs. Holland,
Luby and Shimer. None of the members of the Committee is an officer or
employee of the Company.
In connection with the Heartland Transaction, the Company entered
into employment agreements with, among others, Messrs. Sternberg and
Reilly. These agreements were based in large part upon the terms of each
executive's then existing employment agreement with Old Wireless One,
each of which was executed in April 1995 at the time of Old Wireless
One's sale of preferred stock and warrants to an investor group led by
CMCC. The terms of such agreements were the result of arms-length
negotiations between each executive and CMCC, as the principal investors
in Old Wireless One. The terms of the new agreements were subject to the
approval of the Committee. Upon consummation of its merger with
TruVision in July, 1996 (the "TruVision Transaction"), the Company
entered into similar employment agreements with Mr. Burkhalter and Bill
Byer, the terms of which were approved by the Committee. Mr. Rye and
Henry Schopfer also entered into similar contracts upon their hiring by
the Company, or in the case of Mr. Rye, by Old Wireless One. The
compensation arrangements for such executives were approved by the full
Board upon the recommendation of the Committee. Salaries of such
executives were determined by the Committee based upon a review of
salaries for similar positions at comparable companies and over-all
competitive and market conditions. The compensation arrangements for
such executives will be reviewed annually by the Committee.
In general, these employment agreements establish the base salary
for each executive during the term of the agreement, which is subject to
adjustment based upon increases in the Consumer Price Index. Further,
the agreements establish that such executives are eligible to receive
performance bonuses to be granted by the Committee based upon the
operating performance of the Company. In determining whether to grant
bonuses to these executives, the Committee considers the financial
condition and operational performance of the Company during the last
completed fiscal year and the specific contributions of the individual
executive officer to the Company's performance and the achievement of
strategic business objectives.
Upon consummation of the TruVision Transaction, the Company assumed
the nonqualified options previously issued to Messrs. Burkhalter and Byer
with respect to shares of common stock of TruVision. These options
covered the following number of shares at the weighted average exercise
price indicated: Mr. Burkhalter - 78,015 shares of Common Stock, $6.82
per share and Mr. Byer - 62,411 shares of Common Stock, $6.82 per share.
In addition, the Committee approved the issuance of nonqualified stock
options for 27,000 shares of Common Stock to Mr. Schopfer upon his hiring
in December, 1996 with an exercise price equal to the price of the Common
Stock on the date of grant. In determining the relative number of
options awarded, the Committee considered the position and
responsibilities of Mr. Schopfer and the fact that such options were
awarded as part of the overall compensation package offered to Mr.
Schopfer at the time of his hiring.
For the immediate future, the Committee intends to rely primarily on
options to purchase Common Stock as a means to compensate key members of
management while the Company uses its reserves to develop its operating
systems. The Committee believes that stock options are a cost-effective
method of providing management with long-term compensation. In addition,
the Committee believes that stock options are a particularly appropriate
long-term incentive since they align the interests of the optionee with
those of the stockholders by providing value to the optionee tied
directly to stock price increases. The Committee also intends to rely on
cash bonuses as a means to compensate key members of management depending
on the performance levels of such officers.
The Compensation Committee
William K. Luby J. R. Holland, Jr.
Daniel L. Shimer
Performance Graph
The graph below compares the Company's cumulative total stockholder
return since the Common Stock became publicly traded on October 19, 1995
with the Nasdaq Total Return Index and an index of certain companies
selected by the Company as comparative to the Company in that each is a
wireless cable company. This index includes American Telecasting
Development, Inc., CAI Wireless Systems, Inc., Heartland Wireless
Communications, Inc. and People's Choice TV Corp. The graph assumes that
the value of the investment in the Company's Common Stock at its initial
public offering price of $10.50 per share and each index was $100.00 on
October 19, 1995.
[INSERT GRAPH HERE]
Total Return*
-------------------------------------
December 31,
-----------------
October 19, 1995 1995 1996
---------------- ------ ------
Wireless One, Inc. 100 157 60
Nasdaq Total Return Index 100 102 125
Peer Group Index 100 102 33
____________________
* Total Return assumes the reinvestment of dividends.
Certain Relationships and Related Transactions
In connection with the Heartland Transaction, Heartland and the
Company entered into an agreement whereby (i) the Company agreed not to
compete with Heartland or any of Heartland's subsidiaries in the wireless
cable television business in specified markets in which Heartland and its
subsidiaries operate or have significant channel rights, (ii) Heartland
agreed not to compete with the Company in the wireless cable television
business in specified markets and (iii) if at any time a wireless cable
television system operated by the Company interferes with the signal
transmission of a wireless cable television system operated by Heartland
or one of Heartland's subsidiaries (or vice versa), then the Company,
Heartland and their respective subsidiaries will use their best efforts
to negotiate and enter into an appropriate non-interference agreement.
The Company also entered into a registration rights agreement with
Heartland and all of the former stockholders of Old Wireless One, which
was amended and restated in connection with the TruVision Transaction, to
include the former stockholders of TruVision as parties thereto, pursuant
to which the Company granted to the parties thereto certain demand and
"piggy-back" registration rights with respect to shares of common stock
held by such parties.
In February 1996, CVCA entered into an agreement whereby CVCA
provided TruVision interim financing in an amount up to $12 million at an
annual interest rate of 10% in order to fund certain operating and
acquisition costs.
In connection with the execution of the TruVision Transaction, the
Company agreed to make certain loans to TruVision pending the
consummation of the TruVision Transaction. On May 6, 1996, the Company
made such a loan to TruVision in the amount of approximately $1.5
million, of which TruVision used $1 million to repay borrowings under a
working capital facility guaranteed by Mr. Burkhalter, and that guarantee
was terminated and released. On the date of, but prior to, the
consummation of the TruVision Transaction, the Company loaned TruVision
approximately $1.5 million, and TruVision used the proceeds of that
borrowing to pay accrued dividends on its preferred stock to CVCA and
VanCom in the amounts of approximately $1.4 million and $18,000,
respectively. In addition, the Company issued to VCI, a corporation
controlled by Mr. Burkhalter, 180,000 shares of Common Stock and paid to
VCI $1.8 million in cash, in satisfaction of certain obligations of
TruVision to VCI.
The terms of the transactions described above were determined by the
parties thereto, and the Company believes that such transactions were on
terms no less favorable to the Company than could have been obtained from
unaffiliated third parties in arms-length transactions. The Company
expects that all future transactions between the Company and its
officers, directors, principal stockholders and affiliates will be on
terms no less favorable to the Company than could be obtained from
unaffiliated third parties.
Chase Securities, Inc. ("CSI") is an affiliate of CMCC, CVCA and
Baseball Partners. CSI served as the lead underwriter for the Company's
public unit offering in August 1996 (the "1996 Offering"). In addition,
Mr. Chavkin is a general partner of CCP, which is also affiliated with
CSI. Under Conduct Rule 2720 ("Rule 2720") of the National Association
of Securities Dealers, Inc. (the "NASD"), when a NASD member, such as
CSI, participates in the distribution of a public offering of the
securities of an affiliate of such member, such offering must be
conducted in accordance with the applicable provisions of Rule 2720.
Accordingly, by virtue of CSI's participation in the 1996 Offering and
Chase's ownership interest in the Company, the 1996 Offering was
conducted in accordance with the applicable provisions of Rule 2720.
Prudential Securities Incorporated acted as a qualified independent
underwriter for the 1996 Offering, as required by Rule 2720. The Company
believes that CSI participated in the 1996 Offering on terms and received
fees and commissions from the 1996 Offering on a basis that was no less
fair to the Company than was available from other non-affiliated
underwriters.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors, executive officers and 10% stockholders to file with
the SEC reports of ownership and changes in ownership of equity
securities of the Company. All such reports were timely filed in 1996.
RELATIONSHIP WITH INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS
The Company's consolidated financial statements for the year ended
December 31, 1996 were audited by the firm of KPMG Peat Marwick LLP.
Under the Board resolution appointing KPMG Peat Marwick LLP to audit the
Company's financial statements, such firm will remain as the Company's
auditors until replaced by the Board. Representatives of KPMG Peat
Marwick LLP are expected to be present at the Meeting, with the
opportunity to make any statement they desire at that time, and will be
available to respond to appropriate questions.
OTHER MATTERS
Quorum and Voting of Proxies
The presence, in person or by proxy, of a majority of the
outstanding shares of Common Stock is necessary to constitute a quorum.
Stockholders voting, or abstaining from voting, by proxy on any issue
will be counted as present for purposes of constituting a quorum. If a
quorum is present, the election of directors will be determined by
plurality vote. The affirmative vote of a majority of the shares present
or represented by proxy and entitled to vote is generally required to
approve other proposals that may be properly brought before the Meeting.
Abstention will have the effect of a vote against such proposals. If
brokers do not receive instructions from beneficial owners as to the
granting or withholding of proxies and may not or do not exercise
discretionary power to grant a proxy with respect to such shares (a
"broker non-vote") on a proposal, shares not voted on such proposal as a
result will be counted as not present and not cast with respect to such
proposal.
All proxies received by the Company in the form enclosed will be
voted as specified and, in the absence of instructions to the contrary,
will be voted for the election of the nominees named herein. The Company
does not know of any matters to be presented at the Meeting other than
those described herein; however, if any other matters properly come
before the Meeting, it is the intention of the persons named in the
enclosed proxy to vote the shares represented by them in accordance with
their best judgment.
Stockholder Proposals and Director Nominations
Eligible stockholders who desire to present a proposal qualified for
inclusion in the proxy materials relating to the Company's 1998 annual
meeting pursuant to regulations of the Securities and Exchange
Commission, must forward such proposals to the Secretary of the Company
in time to arrive at the Company's principal executive offices prior to
December 22, 1997.
The Company's by-laws provide that a stockholder wishing to present
a nomination for election of a director or to bring any other matter
before an annual meeting of stockholders must give written notice to the
Company's Secretary not less than 130 days prior to the meeting;
provided, however, that in the event that less than 70 days' notice or
prior public disclosure of the date of the meeting is given or made to
stockholders, notice must be received by the close of business on the
10th day following such notice of the date of the annual meeting was
mailed and public disclosure was made. In addition, such notice must
meet certain other requirements. Any stockholder interested in making
such a nomination or proposal should request a copy of the Company's by-
laws from the Secretary of the Company.
By Order of the Board of Directors
/s/ Henry G. Schopfer III
Henry G. Schopfer III
Secretary
Baton Rouge, Louisiana
April 18, 1997
APPENDIX A
[Front of proxy card]
WIRELESS ONE, INC.
PROXY
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 20, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Sean E. Reilly and Henry G.
Schopfer, III, and each or any of them, proxies of the undersigned, with full
power of substitution, to vote all of the shares of Wireless One, Inc., a
Delaware corporation (the "Company"), which the undersigned may be entitled
to vote at the Annual Meeting of Stockholders of the Company to be held at
the Company's corporate headquarters, 11301 Industriplex, Suite 4, Baton
Rouge, Louisiana 70809-4115 on May 20, 1997 at 10:00 a.m. or at any
adjournment or postponement thereof, as shown on the voting side of this card.
SEE REVERSE
SIDE
[Back of proxy card]
[ X ] Please mark your
votes as in this
example.
This proxy will be voted as specified. If a choice is not specified,
this proxy will be voted FOR the nominees for CLass II Directors.
FOR WITHHELD NOMINEES William K. Luby
1. Election of All [ ] [ ] J.R. Holland, Jr.
Nominees for William J. Van Devender
Class II Directors
Listed Hereon
For all nominees listed hereon, except vote
withheld from the following nominee(s):
_______________________________________
2. In their discreation, the proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting or any
adjourment or postponement thereof.
This proxy should be dated, signed by the
stockholder exactly as the stockholder's
name appears hereon and returned promptly
in the enclosed envelope. Persons signing
in a fiduciary capacity should so indicate.
Please sign as name(s) appear hereon. Joint
owners should each sign. When signing as
attorney, executor, administrator, trustee
or guardian, please give full title as such.
________________________________________
________________________________________
SIGNATURE(S) DATE
