<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
[ ] Confidential, for use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
Metro One Telecommunications, 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] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(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
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
April 4, 1997
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of the Shareholders
of Record of Metro One Telecommunications, Inc., which will be held on Thursday,
May 8, 1997, at 3:30 pm, local time, at the Portland Conference Center, 300 N.E.
Multnomah Street, Portland, Oregon 97232. I hope that you will be able to attend
the meeting.
Details of the business to be conducted at the Annual Meeting are given in
the attached Proxy Statement. The Company's Annual Report for the year ended
December 31, 1996 is also enclosed.
Whether or not you attend the meeting, it is important that your shares be
represented and voted at the meeting. Therefore, I urge you to sign, date, and
promptly return the enclosed proxy in the enclosed postage-paid envelope. If you
decide to attend the Annual Meeting and vote in person, you will, of course,
have that opportunity.
On behalf of the Board of Directors, I would like to express our
appreciation for your continued interest in the affairs of the Company.
Sincerely,
[SIG]
Timothy A. Timmins
President
Chief Executive Officer
<PAGE> 3
METRO ONE TELECOMMUNICATIONS, INC.
NOTICE OF ANNUAL MEETING
TO BE HELD ON MAY 8, 1997
To the Shareholders of Metro One Telecommunications, Inc.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of the shareholders of METRO
ONE TELECOMMUNICATIONS, INC. (the "Company") will be held on May 8, 1997 at 3:30
p.m. local time, at the Portland Conference Center, 300 N.E. Multnomah Street,
Portland, Oregon for the following purposes:
1. To elect five Directors, each for a one-year term;
2. To approve an amendment of the Company's 1994 Stock Incentive Plan to
increase the number of shares of Common Stock available for issuance
under the Plan from 1,428,500 to 1,900,000;
3. To approve an amendment of the Second Restated Articles of Incorporation
to decrease the number of authorized shares of Common Stock from
490,000,000 to 50,000,000;
4. To approve the selection of Deloitte & Touche LLP as independent
auditors for the Company for the year ending December 31, 1997; and
5. To transact such other business as may properly come before the meeting.
The Board of Directors has fixed March 18, 1997 as the record date for the
determination of shareholders entitled to notice of and to vote at the Annual
Meeting. Only shareholders of record at the close of business on that date will
be entitled to notice of and to vote at the Annual Meeting or any adjournments
thereof.
By Order of the Board of Directors
STEBBINS B. CHANDOR, JR.
Secretary
Beaverton, Oregon
April 4, 1997
<PAGE> 4
METRO ONE TELECOMMUNICATIONS, INC.
8405 S.W. NIMBUS AVENUE
BEAVERTON, OREGON 97008
PROXY STATEMENT
FOR
ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON MAY 8, 1997
GENERAL
This Proxy Statement is furnished to shareholders of METRO ONE
TELECOMMUNICATIONS, INC. (the "Company") in connection with the solicitation by
the Board of Directors of proxies from the shareholders of record of the
Company's outstanding shares of Common Stock, no par value (the "Common Stock"),
for use at the Company's Annual Meeting of Shareholders to be held on May 8,
1997, at 3:30 p.m., local time, and at any adjournments or postponements thereof
(the "Annual Meeting").
At the Annual Meeting, shareholders will be asked to (i) elect five members
of the Board of Directors, (ii) approve an amendment of the Company's 1994 Stock
Incentive Plan to increase the number of shares of Common Stock available for
issuance under the Plan from 1,428,500 to 1,900,000, (iii) approve an amendment
of the Second Restated Articles of Incorporation to decrease the number of
authorized shares of Common Stock from 490,000,000 to 50,000,000, (iv) approve
the selection of Deloitte & Touche LLP as independent auditors for the Company
for the year ending December 31, 1997 and (v) transact such other business as
may properly come before the meeting. This Proxy Statement, together with the
enclosed proxy card, is first being mailed to the Company's shareholders on or
about April 4, 1997.
SOLICITATION, VOTING AND REVOCABILITY OF PROXIES
The Board of Directors has fixed March 18, 1997 as the record date for the
determination of the shareholders entitled to notice of and to vote at the
Annual Meeting. Accordingly, only holders of record of shares of Common Stock at
the close of business on such date will be entitled to notice of and to vote at
the Annual Meeting, with each such share entitling its owner to one vote on all
matters properly presented at the Annual Meeting. On the record date, there were
approximately 2,537 beneficial holders of the 10,783,303 shares of Common Stock
then outstanding. The presence, in person or by proxy, of 51% of the total
number of outstanding shares of Common Stock entitled to vote at the Annual
Meeting is necessary to constitute a quorum at the Annual Meeting.
If the enclosed form of proxy is properly executed and returned in time to
be voted at the Annual Meeting, the shares represented thereby will be voted in
accordance with the instructions marked thereon. Executed but unmarked proxies
will be voted (i) FOR the election of the Directors named in the Proxy, (ii) FOR
the amendment of the Company's 1994 Stock Incentive Plan to increase the number
of shares of Common Stock available for issuance under the Plan from 1,428,500
to 1,900,000, (iii) FOR the amendment of the Second Restated Articles of
Incorporation to decrease the number of authorized shares of Common Stock from
490,000,000 to 50,000,000, and (iv) FOR approval of the selection of Deloitte &
Touche LLP as independent auditors for the year ending December 31, 1997.
The presence of a shareholder at the Annual Meeting will not automatically
revoke such shareholder's proxy. A shareholder may, however, revoke a proxy at
any time prior to its exercise by filing a written notice of revocation with, or
by delivering a duly executed proxy bearing a later date to Secretary, Metro One
Telecommunications, Inc., 8405 S.W. Nimbus Avenue, Beaverton, Oregon 97008, or
by attending the Annual Meeting and voting in person. All valid, unrevoked
proxies will be voted at the Annual Meeting.
<PAGE> 5
ELECTION OF DIRECTORS
(PROPOSAL 1)
BACKGROUND
At the Annual Meeting, five directors are to be elected to serve until the
date of the Company's Annual Meeting to be held in 1998 and until their
successors are elected and qualified. Unless otherwise specified on the proxy,
it is the intention of the persons named in the proxy to vote the shares
represented by each properly executed proxy for the election as directors of the
persons named below as nominees. The Board of Directors believes that the
nominees will stand for election and will serve if elected as directors.
However, if any of the persons nominated by the Board of Directors fails to
stand for election or is unable to accept election, the proxies will be voted
for the election of such other persons as the Board of Directors may recommend.
INFORMATION AS TO THE BOARD'S NOMINEES
The following table sets forth the names of the Board of Directors'
nominees for election as directors. Also set forth is certain other information
with respect to each such person's age at March 15, 1997, the periods during
which he has served as a director of the Company, the expiration of his term as
a director, positions currently held with the Company and his principal
occupation or employment during the last five years.
<TABLE>
<CAPTION>
DIRECTOR EXPIRATION
NAME AGE SINCE OF TERM POSITION WITH THE COMPANY
------------------------------ --- -------- ---------- -----------------------------------
<S> <C> <C> <C> <C>
A. Jean de Grandpre 75 1995 1997 Chairman of the Board of Directors
G. Raymond Doucet 54 1995 1997 Director
William D. Rutherford 58 1995 1997 Director
Timothy A. Timmins 40 1994 1997 President, Chief Executive Officer
and Director
James M. Usdan 47 1997 1997 Director
</TABLE>
A. Jean de Grandpre is Chairman of the Board of Directors of the Company
and has served as a director since 1995. Mr. de Grandpre is the founding
Director and Chairman Emeritus of Bell Canada Enterprises from which he retired
in 1989. He has served on the Canadian Advisory Board of BJB International
Management since 1993, and the boards of Textron Canada Ltd. since 1992 and
Thera Technologies since 1993. He is a former Director of Bell Canada, Northern
Telecom Limited, Chrysler Corporation, Chrysler Canada Ltd., and the
International Advisory Board of The Chemical Bank, New York. Mr. de Grandpre is
a Life Member of the Canadian Bar Association, Emeritus Member of the Canadian
Association of Canadian General Counsel, Member of the Bar of the Province of
Quebec and former Chancellor of McGill University. Mr. de Grandpre is a lawyer,
appointed Queen's Counsel, a Companion of the Order of Canada, the highest
honour granted a private citizen. Mr. de Grandpre is the recipient of the
Honourary Associate Award of the Conference Board of Canada and is an inductee
into the Canadian Business Hall of Fame.
G. Raymond Doucet has served as a director of the Company since 1995. Mr.
Doucet is the President and Chief Executive Officer of TeleZone Corporation, a
Toronto-based telecommunications company. He is also President and Chief
Executive Officer of Douserv Management Inc., a Montreal-based holding Company.
From 1984 to 1991, he was the Chairman and Chief Executive Officer of Radcel
Communications Inc. which was purchased by Rogers Communications, Inc. Prior to
that, he was President of Douserv Group Inc., a company offering consulting,
marketing and operational services to the telecommunications industry. From 1965
to 1974, Mr. Doucet was the Director of Technical Services with Bell Canada
where he was responsible for the planning and development of transmission and
distribution networks. Mr. Doucet serves on the boards of directors of Doucet &
Associates Consultants Inc., Servco Quebec Inc. and TeleZone Inc.
2
<PAGE> 6
William D. Rutherford has served as a director of the Company since 1995.
Mr. Rutherford is Chief Executive Officer of Fiberboard Asbestos Compensation
Trust, a position he has held since February 1997. From 1995 to 1996, Mr.
Rutherford was a principal with Macadam Partners, a Portland-based investment
firm. He was formerly the Treasurer of the State of Oregon, where he was
responsible for the State's then $14 billion investment program and the state's
then $7.5 billion in indebtedness and during which service he was elected
Chairman of the Oregon Investment Council. He also served for seven years as a
Member of the Oregon House of Representatives. From 1994 to 1995, Mr. Rutherford
served as Director of Special Projects for Metallgesellschaft Corp., a
multi-billion dollar international trading company. From 1990 through 1993, Mr.
Rutherford was President and a director of Societe Generale Touche Remnant
Corporation (U.S.), an international asset management company. From 1987 to
1990, Mr. Rutherford was President and Chief Executive Officer of ABD
International Management Corporation, an international asset management company.
Mr. Rutherford formerly practiced law and served as the Chief Executive Officer
of a regional investment firm. A U.S. Army veteran, Mr. Rutherford received a
Bachelor of Science in History from the University of Oregon and an LL.B. from
Harvard University Law School.
Timothy A. Timmins has served as President and Chief Executive Officer of
the Company since 1995 and as a director of the Company since 1994. He served as
the Company's Executive Vice President and Chief Financial Officer from 1993 to
1995. From 1985 to 1993, Mr. Timmins served in various capacities with the
Investment Banking Division of Kemper Securities, Inc. and predecessor firms,
ultimately as Senior Vice President. Mr. Timmins is a certified public
accountant and holds a Bachelor of Science degree in Business Administration
from Portland State University and a Masters degree in Business Administration
from the University of Southern California.
James M. Usdan was appointed to the Board of Directors of the Company in
March 1997 to fill a vacancy on the Board. Mr. Usdan is President, Chief
Executive Officer and a director of RehabCare Group Inc., a publicly-traded
(NASDAQ), St. Louis-based developer and manager of inpatient subacute and
outpatient rehabilitation programs under longterm contracts with hospitals. Mr.
Usdan joined RehabCare in 1990 as President and Chief Operating Officer,
becoming Chief Executive Officer of the Company in 1991. Prior to joining
RehabCare, Mr. Usdan founded and was President and Chief Executive Officer of
American Transitional Care, Inc. from 1987 to 1990, and, from 1986 to 1987, he
was Executive Vice President and Chief Operating Officer of Rehab Hospital
Services Corporation, the rehabilitation subsidiary of National Medical
Enterprises. He is a Board member of Maryville University and of the
Metropolitan Employment and Rehabilitation Services. Mr. Usdan holds a Bachelor
of Arts degree from Harvard College.
Pursuant to the Company's Second Restated Articles of Incorporation, at any
time when the Board of Directors consists of six or more members, the Board of
Directors is divided into three classes serving staggered three-year terms.
Directors are otherwise elected to serve one-year terms. Executive officers are
appointed by and serve at the discretion of the Board of Directors.
COMMITTEES OF THE BOARD OF DIRECTORS
The Board of Directors appointed a Compensation Committee in 1995. The
Compensation Committee, which met two times in 1996, reviews executive
compensation and makes recommendations to the full Board regarding changes in
compensation, and also administers the Company's stock option plans. The members
of the Compensation Committee are Messrs. de Grandpre, Doucet and Rutherford.
The Board of Directors appointed a standing Audit Committee in 1996. The Audit
Committee, which met two times in 1996, reviews the scope of the independent
annual audit, the independent public accountants' letter, if any, to the Board
of Directors concerning the effectiveness of the Company's internal financial
and accounting controls and facilitates the preparation of the Board of
Directors' response to that letter, if deemed necessary. The members of the
Audit Committee are Messrs. de Grandpre, Doucet and Rutherford. The Board of
Directors acts as a nominating committee for selecting nominees for election as
directors.
3
<PAGE> 7
DIRECTORS' COMPENSATION AND OTHER ARRANGEMENTS
Generally, directors who are not employees of the Company receive $500 plus
expenses for each Board meeting attended locally or via telephone and $2,500
plus expenses for each meeting attended in person for which substantial travel
is required. Messrs. de Grandpre and Doucet, in 1995, and Mr. Rutherford, in
1996, were granted non-qualified options to purchase 57,140 shares of Common
Stock of the Company at a price of $8.05 per share; such options vest over a
four-year period, which vesting may be accelerated under certain conditions.
Beginning in 1996, Directors who are not employees of the Company will be
granted non-qualified options to purchase 10,000 shares of Common Stock at the
time of recruitment ("Recruitment Grant") and 10,000 shares of Common Stock in
October of each year ("Annual Grant"). The nonemployee Chairman of the Board on
July 31 of each year will also be granted a non-qualified option to purchase
14,286 shares of Common Stock (also, an "Annual Grant"). Annual Grants and
Recruitment Grants are vested and exercisable at the time of the grant and have
exercise prices equal to the market price on the date of grant. Mr. de Grandpre
also receives $2,000 a month for his service as Chairman of the Board.
The Company entered into a two-year consulting agreement with G. Raymond
Doucet, a director, in December 1994, pursuant to which Mr. Doucet will advise
the Company on (i) enhancing the profitability of its Enhanced Directory
Assistance ("EDA"), (ii) technical and personnel matters, and (iii) financial
and budgetary matters. In addition to receiving a consulting fee of $5,000 per
month, the Company in 1994 granted Mr. Doucet an option to purchase up to 85,710
shares of its Common Stock at an exercise price of $2.31 per share. The Company
entered into a new, two-year consulting agreement with Mr. Doucet in December
1996. In connection with the new agreement, in addition to receiving a
consulting fee of $5,000 per month, Mr. Doucet was granted a non-qualified
option to purchase 30,000 shares of Common Stock of the Company at a price of
$13.38 per share. Such options vest upon the occurrence of certain performance
milestones relating to the Company entering into long-term EDA Service contracts
with certain entities. As of March 15, 1997, 10,000 shares under the option had
vested.
BOARD RECOMMENDATION
The Board of Directors recommends a vote FOR the election of its nominees
as Directors. If a quorum is present, a plurality of the votes cast by the
shares entitled to vote is required for the election of a director. Abstentions
and broker non-votes are counted for purposes of determining whether a quorum
exists but are not counted and have no effect in determining whether the nominee
has received the required shareholder vote.
4
<PAGE> 8
MANAGEMENT
EXECUTIVE OFFICERS
The following table sets forth certain information with respect to the
executive officers of the Company:
<TABLE>
<CAPTION>
NAME AGE POSITION
- - ------------------------- --- ------------------------------------------------------------
<S> <C> <C>
Timothy A. Timmins 40 President, Chief Executive Officer and Director
Stebbins B. Chandor, Jr. 37 Senior Vice President, Chief Financial Officer and Secretary
Gary E. Henry 40 Senior Vice President -- Call Center Operations
Kevin S. Anderson 33 Vice President -- Customer Care and Project Administration
Lori A. Castillo-Brown 41 Vice President -- Sales & Marketing
Patrick M. Cox 35 Vice President -- Technology
Karen L. Johnson 47 Vice President -- Controller and Corporate Development
Michael A. Kepler 34 Vice President -- Information Systems
</TABLE>
Information concerning the principal occupation of Mr. Timmins is set forth
under "Information as to the Board's Nominees." Information concerning the
principal occupation during the last five years of the executive officers of the
Company who are not also directors of the Company is set forth below.
Stebbins B. Chandor, Jr. joined the Company in September 1995 and serves as
Senior Vice President and Chief Financial Officer. He has served as Secretary of
the Company since August, 1996. From 1985 to 1995, Mr. Chandor served in various
corporate finance capacities with BA Securities, Inc., a wholly-owned subsidiary
of BankAmerica Corporation, and affiliated or predecessor firms including Bank
of America and Continental Bank N.A. He specialized in structured finance/asset
securitization and mezzanine debt financing. Mr. Chandor holds a Bachelor of
Science degree in Chemical Engineering from Tufts University and a Masters
degree in Business Administration from the University of Southern California.
Gary E. Henry joined the Company in 1993 and serves as Senior Vice
President -- Call Center Operations. Prior to 1993, Mr. Henry was Senior Vice
President, Corporate Services Director for Imperial Corporation of America,
Inc., a financial institution, with whom he was employed since 1985. He holds a
Bachelor of Arts degree in Public Administration from San Diego State
University.
Kevin S. Anderson has served as Vice President -- Customer Care and Project
Administration of the Company since 1996. Since its inception in 1989, Mr.
Anderson has served in various capacities including President, Executive Vice
President and Senior Vice President. From 1988 to 1989, Mr. Anderson served as
Vice President of Operations for Line One Telecommunications, Inc. Mr. Anderson
holds a Bachelor of Science degree in Business Administration from Oregon State
University
Lori A. Castillo-Brown joined the Company in October 1996 and serves as
Vice President -- Sales & Marketing. Prior to joining the Company, Ms. Brown was
President of ENTEK Solutions, a nationwide technical consulting company from
1991 to 1996. Ms. Brown has held various sales, management and marketing
positions with US West Information Systems and with Executone Information
Systems, an independent manufacturer of telecommunications products. She holds a
Bachelor of Science degree in Marketing from the University of Oregon.
Patrick M. Cox has served as Vice President -- Technology of the Company
since 1996 and served as Executive Vice President and Chief Operating Officer
from 1993 to 1996, Secretary of the Company from 1995 to 1996 and a director of
the Company from 1989 to 1996. Since the Company's inception in 1989 through
October 1993, Mr. Cox served as Chairman of the Board of Directors, President
and Chief Executive Officer or similar positions. From 1986 to 1989, Mr. Cox was
a Director and Vice President of Line One Telecommunications, Inc., a company
that installed and serviced private communications networks and served as a
sales, service and repair center for Cellular One. Mr. Cox is a member of the
National Association of Radio and Telecommunications Engineers and is a
Certified Engineer Class One.
5
<PAGE> 9
Karen L. Johnson joined the Company in November 1993 and serves as Vice
President -- Controller and Corporate Development. From 1989 to 1993, she was
Financial Operations Manager for Care Medical Equipment, Inc. and Care
Ambulance, Inc. Ms. Johnson is a certified public accountant with a Bachelor of
Arts degree from St. Olaf College and she performed post-graduate work in
accounting and business administration at Portland State University.
Michael A. Kepler has served as Vice President -- Information Systems for
the Company since 1993. From 1989 to 1993 he held a similar position as Director
of Information Systems. From March 1989 until joining the Company, Mr. Kepler
was a programmer with ComLink West, a computer services concern that performed
contract programming for the Company. During 1988 and early 1989, he was an
Engineering Technician with Single Board Systems and an Assembly and Testing
Technician with Hewlett Packard.
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than 10% of a
registered class of the Company's equity securities, to file with the Securities
and Exchange Commission reports of ownership and changes in ownership of Common
Stock and other equity securities of the Company. Officers, directors and
greater than 10% shareholders are required by Securities and Exchange Commission
regulations to furnish the Company with copies of all Section 16(a) forms they
file. To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company, the Company believes that during fiscal 1996
its officers, directors and greater than 10% shareholders complied with all
applicable Section 16(a) filing requirements.
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<PAGE> 10
EXECUTIVE COMPENSATION
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table sets forth, for the fiscal year ended December 31,
1996, certain summary information concerning compensation of the person serving
as the Company's Chief Executive Officer and the one other most highly paid
executive officer of the Company whose total annual salary and bonus exceeded
$100,000 (the "Named Executive Officers"). No other executive officer received
compensation exceeding $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
------------
ANNUAL COMPENSATION SECURITIES
----------------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OPTIONS/SARS COMPENSATION
- - ------------------------------------ ---- -------- ------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Timothy A. Timmins 1996 $127,385 -- -- --
President and Chief Executive
Officer 1995 96,961 -- 399,981 --
1994 79,961 -- -- --
Patrick M. Cox 1996 116,154 -- -- --
Vice President -- Technology 1995 98,850 -- 199,991 --
1994 89,729 -- -- --
</TABLE>
OPTIONS GRANTED
During the year ended December 31, 1996, no Named Executive Officer was
granted an option to purchase Common Stock pursuant to the Company's 1994 Stock
Incentive Plan (the "Plan").
YEAR-END OPTION TABLE
The following table provides information regarding exercises of options
during 1996 and unexercised options held, as of December 31, 1996, by the Named
Executive Officers.
AGGREGATE OPTION EXERCISES IN LAST FISCAL YEAR AND YEAR-END OPTION VALUE
<TABLE>
<CAPTION>
SHARES NUMBER OF SECURITIES VALUE OF UNEXERCISED
ACQUIRED UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
ON VALUE OPTIONS AT YEAR-END AT YEAR-END
NAME EXERCISE REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
- - --------------------------------- -------- -------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
Timothy A. Timmins............... -- -- 349,983/49,998 0/0
Patrick M. Cox................... -- -- 199,991/0 0/0
</TABLE>
In July 1995, the Company entered into employment contracts with Messrs.
Timmins and Cox that allow for a base annual compensation and increases based
upon achievement of certain corporate goals and upon a formula tied to the
profitability of the Company and for employment of them for five-year periods
ending in July of 2000. The agreements provide for annual base salaries for
Messrs. Timmins and Cox of $120,000 and $110,000, respectively, that are
eligible for a one-time increase of $30,000 and $25,000, respectively, based
upon the occurrence of (i) a public offering of the Company's Common Stock at
price of $10.50 per share resulting in aggregate gross proceeds to the Company
of $10,000,000 or (ii) a sale or merger of the Company resulting in $10.50
consideration per share or (iii) the achievement of three consecutive calendar
quarters of earnings by the Company before interest, taxes and depreciation of
$250,000 in addition to the trading of the Company's Common Stock at $10.50 per
share for a specified period (each such base salary, if increased, hereafter an
"adjusted base salary"). Based on the achievement of three consecutive calendar
quarters of earnings by the Company before interest, taxes and depreciation of
$250,000 and the trading of the Company's Common Stock at $10.50 per share for a
specified period, Messrs. Timmins and Cox began to earn their adjusted base
salary during the fourth quarter of 1996. The employment agreements provide for
annual bonuses for 2 percent up to 100 percent of base salary or adjusted base
salary, as applicable, based upon the
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<PAGE> 11
Company's achievement of earnings per share from $.07 to $4.45 in the year in
which net earnings are first achieved and annual bonuses from 2 percent to 100
percent of base salary or adjusted base salary, as applicable, for earnings per
share growth from 8 percent to 30 percent in subsequent years. The employment
agreements also provide for payment to Messrs. Timmins and Cox of one additional
year of base salary or adjusted base salary, as applicable, in the event of the
termination of their respective employment for reasons other than cause and six
months additional base salary or adjusted base salary, as applicable, if for
cause, for disability or upon their death. Under the employment agreements,
Messrs. Timmins and Cox have been granted certain indemnification rights. In
addition, the employment agreements prevent Messrs. Timmins and Cox from
competing with the Company or soliciting the employment of other individuals
employed by the Company during Messrs. Timmins' and Cox's respective employment
and for a period of one year thereafter. Under the employment agreements,
Messrs. Timmins or Cox may not disclose the Company's confidential information
to outsiders during their respective employment and for a period of two years
thereafter.
CERTAIN TRANSACTIONS
During 1994, G. Raymond Doucet and A. Jean de Grandpre, both of whom are
now directors of the Company, purchased 8% Convertible Secured Notes ("8%
Notes") of the Company in the principal amounts of $275,000 and $150,000,
respectively, through investment companies controlled by them, as part of a
convertible secured note financing of the Company (the "Secured Note
Financing"). The 8% Notes beneficially held by Messrs. Doucet and de Grandpre
were converted into 119,042 and 64,932 shares of the Common Stock of the
Company, respectively, during the fourth quarter of 1995.
On May 31, 1996, the lenders in the Secured Note Financing, including MDL
Investments Inc., Mr. Doucet and Mr. de Grandpre (the "Lenders"), and the
Company entered into a Shareholder Rights Agreement, pursuant to which the
Company granted to the Lenders certain registration rights with respect to
shares of Common Stock of the Company held by the Lenders and a right of first
refusal with respect to future sales of Common Stock, preferred stock or other
securities issued by the Company. Mr. Doucet exercised this right of first
refusal and purchased 16,712 shares in the August 1996 initial public offering
of the Company's Common Stock at the initial public offering price of $8.50. The
Shareholder Rights Agreement provides for the termination of this right of first
refusal upon the consummation of an underwritten public offering of the Common
Stock of the Company in which the Company receives cash proceeds of not less
than $10 million based on a per share price of at least $10.50.
The Company entered into a two-year consulting agreement with Mr. Doucet in
November 1994 and granted him a five-year option to purchase up to 85,710 shares
of its Common Stock at an exercise price of $2.31 per share. The Company entered
into a new, two-year consulting agreement with Mr. Doucet in December 1996 and
in connection with that agreement, the Company granted Mr. Doucet an additional
option to purchase up to 30,000 shares of its Common Stock at an exercise price
of $13.38. See "Directors' Compensation and Other Arrangements."
On July 20, 1995, Robert J. Cymbala resigned as the Company's President and
Chief Executive Officer. In connection with that resignation, the Company and
Mr. Cymbala entered into an agreement, dated July 20, 1995, wherein the Company
agreed to pay Mr. Cymbala the amount of $98,193, representing nine months
compensation which amount was paid to Mr. Cymbala in biweekly installments
ending April 19, 1996. The agreement also included a release of claims by Mr.
Cymbala and a covenant prohibiting Mr. Cymbala from competing with the Company
for a period of one year.
8
<PAGE> 12
From time to time the Company has made cash advances to its officers,
employees and consultants. At December 31, 1996, the Company carried several
unsecured notes receivable, bearing interest at rates ranging from 7.89% to
9.01%, from certain of its officers, employees, consultants and a former
employee. The following table lists individuals for whom the Company carried
aggregate outstanding balances greater than $60,000 at any time during 1995 or
1996.
<TABLE>
<CAPTION>
BALANCE AT
NAME DECEMBER 31, 1996
------------------------------------- -----------------
<S> <C>
Kevin S. Anderson.................... $63,002
Patrick M. Cox....................... $60,395
</TABLE>
The loans to Mr. Anderson are evidenced by 44 promissory notes with
maturities from June, 1992 to December, 1994, and bear interest at rates ranging
from 7.89% to 9.01%. The loans to Mr. Cox are evidenced by 38 promissory notes
with maturities from June, 1992 to December, 1994, and bear interest at rates
ranging from 7.89% to 9.01%. These loans were extended by the Company to Messrs.
Anderson and Cox for personal purposes during periods when the Company's
financial position did not permit significant compensation increases to officers
and when the Company's future capital needs were uncertain. The Company believed
that making these cash advances allowed it to retain key personnel while
maintaining the ability to secure repayment at later dates if required by the
Company's capital needs. Although these notes have matured and are due, some of
these notes may be forgiven at future dates, resulting in additional payroll tax
liability for the Company and additional income tax liability for the makers of
the notes.
The Company believes that the foregoing transactions were fair to the
Company and in its best interests. As a matter of policy, all future
transactions between the Company and any of its officers, directors or principal
stockholders or their affiliates will continue to be approved by a majority of
the Board of Directors and will continue to be on terms no less favorable to the
Company than could be obtained from unaffiliated third parties, and will
continue to be for bona fide business purposes of the Company.
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<PAGE> 13
PRINCIPAL SHAREHOLDERS
The following table sets forth as of March 15, 1997, certain information
regarding the ownership of the Company's Common Stock by (i) each person known
by the Company to own beneficially more than 5% of the Common Stock, (ii) each
director of the Company, (iii) each Named Executive Officer and (iv) all
executive officers and directors as a group. Except as otherwise indicated, the
Company believes the that persons listed below have sole investment and voting
power with respect to the shares of Common Stock owned by them.
<TABLE>
<CAPTION>
SHARES BENEFICIALLY
OWNED
---------------------
NAMED EXECUTIVE OFFICERS, DIRECTORS AND 5% SHAREHOLDERS NUMBER(1) PERCENT
------------------------------------------------------- --------- -------
<S> <C> <C>
Patrick M. Cox......................................... 459,501 4.2
8405 S.W. Nimbus Avenue
Beaverton, Oregon 97008
A. Jean de Grandpre.................................... 99,930 *
8405 S.W. Nimbus Avenue
Beaverton, Oregon 97008
G. Raymond Doucet...................................... 266,462.. 2.4
8405 S.W. Nimbus Avenue
Beaverton, Oregon 97008
William D. Rutherford.................................. 48,047 *
8405 S.W. Nimbus Avenue
Beaverton, Oregon 97008
Timothy A. Timmins..................................... 403,910 3.6
8405 S.W. Nimbus Avenue
Beaverton, Oregon 97008
James M. Usdan......................................... 10,000 *
8405 S.W. Nimbus Avenue
Beaverton, Oregon 97008
Fiduciary Trust Company International.................. 683,800 6.3
Two World Trade Center
New York, New York 10048
MDL Investments, Inc................................... 545,219 5.1
999 de Maisonneuve Blvd West, Suite 1775
Montreal, Quebec Canada H3A 3L4
All directors and officers as a group (12 persons)..... 1,765,762 16.1
</TABLE>
- - ---------------
* Less than one percent
(1) Beneficial ownership is determined in accordance with rules of the
Securities and Exchange Commission, and includes voting power and investment
power with respect to shares. Shares issuable upon the exercise of
outstanding stock options that are currently exercisable or become
exercisable within 60 days from March 15, 1997 are considered outstanding
for the purpose of calculating the percentage of Common Stock owned by such
person but not for the purpose of calculating the percentage of Common Stock
owned by any other person. The number of shares that are issuable upon the
exercise of options that are currently exercisable or exercisable within 60
days of March 15, 1997 is as follows: Patrick M. Cox -- 199,991 shares; G.
Raymond Doucet -- 130,708 shares; A. Jean de Grandpre -- 34,998 shares;
William D. Rutherford -- 27,852 shares; Timothy A. Timmins -- 399,981
shares; James M. Usdan -- 10,000 shares and All directors and officers as a
group -- 1,020,240 shares.
10
<PAGE> 14
AMENDMENT TO 1994 STOCK INCENTIVE PLAN
(PROPOSAL 2)
GENERAL
The shareholders are being asked to approve an amendment to the Company's
1994 Stock Incentive Plan ("Plan") that will increase the number of shares of
Common Stock available for issuance under the Plan by 471,500 shares to
1,900,000 shares of Common Stock. The Plan was approved by the Board of
Directors on November 30, 1994 and by the Shareholders at a Special Meeting of
the Shareholders on November 29, 1995. On March 4, 1997, the Board unanimously
adopted an amendment, subject to shareholder approval, increasing the number of
shares of Common Stock available for issuance under the Plan.
As of March 15, 1997, there were 137,024 shares available for future
issuance under the Plan (exclusive of the increase in shares subject to
shareholder approval at this Annual Meeting). The Board of Directors believes
that increasing the number of shares available for issuance under the Plan will
provide the Company with equity award opportunities to attract, retain and
motivate the best available personnel for the successful conduct of its
business. The Company believes that the number of remaining shares available for
issuance under the Plan will be insufficient to accomplish these purposes. The
Company anticipates that this increase in shares reserved under the Plan should
meet the Company's retention and motivation goals through the next two to three
years.
The principal terms and provisions of the Plan are summarized below. The
summary, however, is not intended to be a complete description of all the terms
of the Plan. A copy of the Plan, as amended, will be furnished by the Company to
any shareholder upon written request to the Corporate Secretary at the Company's
corporate offices.
SUMMARY OF THE 1994 STOCK INCENTIVE PLAN
The purposes of the Plan are to attract and retain the best available
personnel for positions of substantial responsibility at Metro One
Telecommunications, Inc. (the "Company"), to provide additional incentive to the
Company's employees and consultants and to promote the success of the Company's
business. The Plan may be administered by the Company's Board of Directors (the
"Board"), or by a Committee (the "Committee") the members of which are appointed
by the Board. The Plan is currently administered by the Compensation Committee
of the Board. In accordance with the terms of the Plan, the Board, or the
Committee, may grant options: (i) intended to qualify as Incentive Stock Options
("ISOs") under Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), to employees; or (ii) not intended to qualify as ISOs under Section 422
of the Code ("NSOs") to employees or consultants. Direct stock grants or sales
may also be made under the Plan.
Securities Offered. The stock options that may be granted under the Plan
may be exercised to purchase shares of the Company's common stock, no par value
(the "Common Stock"), 1,428,500 shares of which have been reserved for issuance
upon the exercise of options granted, or sales made, pursuant to the provisions
of the Plan.
Eligibility. Employees, defined as any person, including officers and
directors, employed by the Company or any parent or subsidiary of the Company,
are eligible to be granted options under the Plan. Consultants, defined as any
person who is engaged by the Company or any subsidiary to render consulting
services, and who is compensated for such services, are also eligible to be
granted options under the Plan. If an employee is granted an ISO which, when
aggregated with all other ISOs granted to such employee by the Company, or by
any parent or subsidiary of the Company, would result in shares of the Common
Stock having an aggregate fair market value in excess of One Hundred Thousand
and No/100 Dollars ($100,000.00) becoming available for purchase upon the
exercise of one (1) or more ISOs during any calendar year, then such excess ISOs
shall be treated as NSOs.
Option Terms. The term of each ISO shall be ten (10) years from the date of
grant or such shorter term as may be stated in the agreement granting such ISO;
provided, however, that the term of an ISO granted to
11
<PAGE> 15
an employee who, at the time of such grant, owns shares representing more than
ten percent (10%) of the voting power of all classes of the Company's, any
parent's or subsidiary's stock, shall be five (5) years from the data of grant
or such shorter term as may be stated in the agreement granting such ISO. The
term of each NSO shall be ten (10) years and one (1) day from the date of grant
or such other term as may be stated in the agreement granting such NSO;
provided, however, that the term of a NSO granted to an employee who, at the
time of such grant, owns shares representing more than ten percent (10%) of the
voting power of all classes of the Company's, any parent's or subsidiary's
stock, shall be five (5) years and one (1) day or such shorter term as may be
stated in the agreement granting such NSO.
An option granted pursuant to the provisions of the Plan may be exercised
at such times and under such conditions as the Board determines. If an employee
to whom an ISO or NSO has been granted ceases to be an employee of the Company
other than by reason of his death or disability, such person may exercise his
ISO or NSO only during such period as the Board specified at the time the ISO or
NSO was granted, which period of time may in no event exceed 90 days from the
date of termination, and only to the extent that he could have exercised it on
the date of his termination. An option may not be sold, transferred or otherwise
disposed of in any manner other than by the laws of descent and distribution.
During the lifetime of the person to whom an option was granted (the
"Optionee"), such option generally may be exercised only by the Optionee. If an
Optionee ceases to be an employee or a consultant to the Company by reason of
his disability, then the Optionee may exercise his option at any time during the
12 month period following the date of his termination (to the extent that he
could have exercised it on the date of his termination). In the event of the
death of an Optionee, such option generally may be exercised (to the extent such
option was exercisable on the date of death) during the 12-month period
following the date of death by a the Optionee's estate or by a person who
acquired such option by bequest or inheritance.
The Board shall determine the exercise price of ISOs granted under the
Plan, but such price may not in any case be less than one hundred percent (100%)
of the fair market value per share of the Common Stock on the date the option is
granted. The Board shall determine the exercise price of NSOs granted under the
Plan, but such price may not in any case be less than eighty-five percent (85%)
of the fair market value per share of the Common Stock on the date the option is
granted. The Board shall determine, in its discretion, the fair market value per
share of the Common Stock; provided, however, that if there is a public market
for the Common Stock, such fair market value shall be the closing price of a
share of the Common Stock on the last market trading day prior to the date of
grant of an option or the date of authorization of a sale. The Board shall
determine the consideration to be paid upon the exercise of an option or
pursuant to a sale, including the method of payment, which may consist of cash,
check, transfer to the Company of previously owned shares of the Common Stock
having a fair market value equal to the option exercise price, delivery of
instructions to the Company to withhold shares of the Common Stock that would
otherwise be issued upon the exercise of the option having a fair market value
equal to the option exercise price, or any combination of the foregoing methods
of payment.
Amendment of the Plan. The Board may amend or terminate the Plan at any
time; provided, however, that no amendment regarding amount, price or timing of
the option grants may be made more frequently than once every six (6) months
other than to comply with changes in the requirements of the Code or the
Securities Exchange Act of 1934. No amendment or termination shall affect any
options outstanding at that time. Any amendment that would increase the number
of shares that may be issued under the Plan (other than with respect to changes
in the capitalization of the Company), modify the requirements as to eligibility
for participation in the Plan, or materially increase the benefits accruing to
participants in the Plan, must be approved by the Company's shareholders.
Resale Restrictions. Shares of Common Stock purchased under the Plan
(whether by the exercise of an option or by direct sale) by the Company's
officers and directors, or a beneficial owner of ten percent (10%) or more of
any class of the Company's equity securities (collectively, "affiliates") will
be eligible for resale in accordance with Rule 144 under the Securities Act of
1933. In addition, the Company's affiliates must hold any shares issuable upon
the exercise of an option, or a direct grant or sale, for at least six (6)
months from the date the option is granted, or from the date the shares are
granted or sold, respectively.
12
<PAGE> 16
Federal Income Tax Consequences. Under federal income tax law currently in
effect, the Optionee of an ISO will recognize no income upon the grant or
exercise of the ISO. However, the Optionee will have a preference item for
alternative minimum tax purposes upon exercise of the ISO in the amount by which
the fair market value of the shares subject to the ISO at the time of exercise
exceeds the exercise price. If an Optionee exercises an ISO and does not dispose
of any of the shares acquired thereby within two (2) years following the date of
the ISOs grant and within one (1) year following the date of exercise, then any
gain realized upon subsequent disposition of such shares will be taxable as
capital gain. If an Optionee disposes of shares acquired upon exercise of an ISO
before the expiration of either the one (1) year holding period or the two (2)
year waiting period, any amount realized will be taxable as ordinary income in
the year of such disqualifying disposition to the extent that the lesser of the
fair market value of the shares on the exercise date, or the fair market value
of the shares on the date of disposition, exceeds the exercise price.
There are no federal income tax consequences to the Company by reason of
the grant or exercise of an ISO. In the event of a disqualifying disposition by
an Optionee, the Company will be entitled to a business expense deduction in the
tax year in which the disposition occurred to the extent the Optionee recognized
ordinary income.
Under federal income tax law currently in effect, the Optionee of a NSO
will recognize no income upon the grant of the NSO. At the time the NSO is
exercised, the Optionee will recognize ordinary income in the amount by which
the fair market value of the shares subject to the NSO at the time of exercise
exceeds the exercise price, and the Company will be entitled to a business
expense deduction for the same amount (conditioned upon proper withholding).
Upon the Optionee's disposition of shares acquired pursuant to exercise of an
NSO, the excess of the amount realized from such disposition over the fair
market value of the shares on the exercise date will be taxable as short- or
long-term capital gain depending on how long the shares have been held.
PROPOSED AMENDMENT
If the proposal is adopted, the first paragraph of Section 3 of the 1994
Stock Incentive Plan will be amended and read as follows:
3. Stock Subject to the Plan. Subject to the provisions of Section 11
of the Plan, the maximum aggregate number of Shares which may be optioned
and/or Sold under the Plan is 1,900,000 shares of Common Stock. The Shares
may be authorized, but unissued, or reacquired Common Stock.
BOARD RECOMMENDATION
The purpose of the Plan is to provide a means whereby key employees,
officers, non-employee directors, consultants, and advisors of the Company may
be given the opportunity to purchase shares of the Company's Common Stock
pursuant to options granted under the Plan. The Board of Directors believes that
option grants play an important role in the Company's efforts to attract,
employ, and retain employees, directors and consultants of outstanding ability,
and the Board accordingly recommends the shareholders vote FOR the amendment. If
a quorum is present, this proposal will be approved if a majority of the votes
cast on the proposal are voted for approval of the proposal. Abstentions and
broker non-votes are counted for purposes of determining whether a quorum
exists, but are not counted as votes cast and have no effect on the results of
the vote on this proposal.
13
<PAGE> 17
AMENDMENT TO RESTATED ARTICLES OF INCORPORATION
(PROPOSAL 3)
On March 4, 1997, the Board unanimously adopted an amendment, subject to
shareholder approval, decreasing the number of authorized shares of Common Stock
of the Company from 490,000,000 to 50,000,000. The proposed decrease in
authorized shares is being submitted to permit the Company to reduce state
franchise taxes which it pays in one or more jurisdictions in which it maintains
call centers. In certain states, the franchise taxes paid by a corporation are
determined by formula, taking into account a company's authorized shares of
common stock and other securities. Due to the significant number of shares
authorized by the Company's Second Restated Articles of Incorporation, the
Company may be required to pay inordinately high franchise taxes in the absence
of this decrease.
Management does not anticipate that the additional authorized shares will
be required in connection with any future offerings of equity securities by the
Company. If additional authorized shares are so required, a proposed increase
will be submitted for approval to the Company's shareholders. Management further
believes that the proposed amendment will provide a long-term advantage to the
Company and its shareholders by the reduction of franchise taxes to be paid by
the Company in one or more states.
If the proposal is adopted, Section A. of Article IV. "Capitalization" of
the Second Restated Articles of Incorporation will be amended and read as
follows:
A. The authorized capital stock of the Corporation consists of 50,000,000
shares of common stock, no par value ("Common Stock"), and 10,000,000
shares of preferred stock, no par value ("Preferred Stock").
BOARD RECOMMENDATION
If a quorum is present, this proposal will be approved if a majority of the
votes cast on the proposal are voted for approval of the proposal. Abstentions
and broker non-votes are counted for purposes of determining whether a quorum
exists, but are not counted as votes cast and have no effect on the results of
the vote on this proposal. To permit the Company to seek the franchise tax
reductions, the Board of Directors has unanimously recommended that the
shareholders vote FOR the amendment.
SELECTION OF INDEPENDENT AUDITORS
(PROPOSAL 4)
The Board of Directors has selected Deloitte & Touche LLP as independent
auditors for the current year ending December 31, 1997. For the years ended
December 31, 1996 and 1995, Deloitte & Touche served as the Company's
independent auditors. It is expected that representatives of Deloitte & Touche
LLP will be present at the Annual Meeting, will have the opportunity to make a
statement if they so desire, and will be available to respond to appropriate
questions.
On November 30, 1995, the Company engaged Deloitte & Touche LLP as its
principal accountants, replacing Price Waterhouse LLP. The decision to change
accountants was approved by the Company's Board of Directors. The Company
believes, and was advised by Price Waterhouse that it concured with such belief,
that during the Company's two most recent fiscal years ending December 31, 1994,
the Company and Price Waterhouse did not have any disagreement on any matter of
accounting principals or practices, financial statement disclosure or auditing
scope or procedure, which disagreement, if not resolved to the satisfaction of
Price Waterhouse, would have caused it to make reference to the subject matter
of the disagreement in connection with its reports on the financial statements
for such years. During the Company's two most recent fiscal years ending
December 31, 1994, Price Waterhouse's reports on the Company's financial
statements contained no adverse opinion or disclaimer of opinion, nor were they
qualified or modified as to uncertainty, audit scope, or accounting principles,
except that Price Waterhouse's reports for each of the last two fiscal years
made reference to uncertainties surrounding the Company's ability to continue as
a going concern.
14
<PAGE> 18
BOARD RECOMMENDATION
Although the selection of auditors is not required to be submitted to a
vote of the shareholders, the Board has decided to ask the shareholders to
approve the selection and recommends that the shareholders vote FOR approval. If
a majority of the shares of Common Stock represented at the Annual Meeting does
not vote to approve the selection, the Board will reconsider the selection.
OTHER BUSINESS
As of the date of this Proxy Statement, the Company knows of no other
business which will be presented for action at the meeting. If any other
business requiring a vote of the shareholders should properly come before the
meeting, the persons named in the enclosed proxy form will vote in their
discretion upon such other matters.
DATE FOR SUBMISSION OF SHAREHOLDER PROPOSALS
Any shareholder proposal intended for inclusion in the proxy statement and
form of proxy relating to the Company's 1997 annual meeting of shareholders must
be received by the Company not later than December 5, 1997, pursuant to the
proxy soliciting regulations of the Securities and Exchange Commission (the
"SEC"). Nothing in this paragraph shall be deemed to require the Company to
include in its proxy statement or form of proxy for such meeting any shareholder
proposal which does not meet the requirements of the SEC in effect at the time.
COST OF SOLICITATION
The cost of soliciting proxies will be borne by the Company. In addition to
use of the mails, proxies may be solicited personally or by telephone by
directors, officers and employees of the Company, who will not be additionally
compensated for such activities. Such solicitations may be made personally, or
by mail, facsimile, telephone, telegraph or messenger. The Company will also
request persons, firms and companies holding shares in their names or in the
name of their nominees, which are beneficially owned by others, to send proxy
materials to and obtain proxies from such beneficial owners. The Company will
reimburse such persons for their reasonable expenses incurred in that
connection.
ADDITIONAL INFORMATION
A copy of the Company's Annual Report to Shareholders for the fiscal year
ended December 31, 1996 accompanies this Proxy Statement. The Company is
required to file an Annual Report on Form 10-KSB for its fiscal year ended
December 31, 1996 with the Securities and Exchange Commission. Shareholders may
obtain, free of charge, a copy of the Form 10-KSB, without exhibits, by writing
to Investor Relations, Metro One Telecommunications, Inc., 8405 S.W. Nimbus
Avenue, Beaverton, Oregon 97008.
15
<PAGE> 19
METRO ONE TELECOMMUNICATIONS, INC.
PROXY FORM
ANNUAL MEETING OF SHAREHOLDERS
MAY 8, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF METRO ONE
TELECOMMUNICATIONS, INC.
The undersigned shareholder of record of Metro One Telecommunications,
Inc., an Oregon corporation (the "Company"), hereby appoints Timothy A. Timmins
and A. Jean de Grandpre, or either of them, with full power of substitution, as
proxies to cast all votes which the undersigned shareholder is entitled to cast
at the Annual Meeting of Shareholders to be held at 3:30 p.m. on May 8, 1997, at
the Portland Conference Center, 300 N.E. Multnomah Street, Portland, Oregon, or
any adjournments or postponements thereof upon the matters listed herein AND IN
THEIR DISCRETION UPON SUCH OTHER MATTERS AS MAY PROPERLY COME BEFORE THE
MEETING.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED SHAREHOLDER. UNLESS DIRECTION IS GIVEN, THIS PROXY
WILL BE VOTED "FOR" THE ELECTION OF THE NOMINEES LISTED IN PROPOSAL 1, "FOR"
PROPOSALS 2, 3 AND 4, AND IN ACCORDANCE WITH THE RECOMMENDATIONS OF A MAJORITY
OF THE BOARD OF DIRECTORS AS TO OTHER MATTERS. The undersigned hereby
acknowledges receipt of the Company's Proxy Statement and hereby revokes any
proxy or proxies previously given.
1. To elect five members to the Company's Board of Directors. Directors
nominated are A. Jean de Grandpre, G. Raymond Doucet, William D.
Rutherford, Timothy A. Timmins and James M. Usdan.
WITHHELD FOR ALL
FOR FOR ALL EXCEPT*
-------- ------------ ---------
* Except: __________________________________________
2. To approve an amendment of the Company's 1994 Stock Incentive Plan to
increase the number of shares of Common Stock available for issuance under
the Plan from 1,428,500 to 1,900,000.
FOR AGAINST ABSTAIN
--------- ----------- ------------
17
<PAGE> 20
3. To approve an amendment of the Second Restated Articles of
Incorporation to decrease the number of authorized shares of Common
Stock from 490,000,000 to 50,000,000.
FOR AGAINST ABSTAIN
--------- ----------- ------------
4. To approve the selection of Deloitte & Touche LLP as the Company's
independent auditors.
FOR AGAINST ABSTAIN
--------- ----------- ------------
PLEASE SIGN, DATE, AND RETURN THIS PROXY CARD TODAY IN THE ENCLOSED,
PRE-ADDRESSED ENVELOPE.
Please sign below exactly as your name appears on this Proxy Card. If shares are
registered in more than one name, all such persons should sign. A corporation
should sign in its full corporate name by a duly authorized officer, stating
his/her title. Trustees, guardians, executors and administrators should sign in
their official capacity, giving their full title as such. If a partnership,
please sign in the partnership name by authorized person(s).
If you receive more than one Proxy Card, please sign and return all such cards
in the accompanying envelope.
- - ----------------------------------------
Typed or Printed Name(s)
- - ----------------------------------------
Authorized Signature
- - ----------------------------------------
Title or authority, if applicable
- - ----------------------------------------
Date
PLEASE RETURN PROMPTLY IN THE ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE IF
MAILED IN THE U.S.A.
[ ] I PLAN TO ATTEND THE ANNUAL MEETING.
[ ] I DO NOT PLAN TO ATTEND THE ANNUAL MEETING.
18
