SPECIALTY TELECONSTRUCTORS INC, PRE 14A, 1997-10-15

SPECIALTY TELECONSTRUCTORS INC
PRE 14A, 1997-10-15
WATER, SEWER, PIPELINE, COMM & POWER LINE CONSTRUCTION

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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 Section 240.14a-11(c) or Section 240.14a-12

Specialty Teleconstructors, 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:

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(2) Aggregate number of securities to which transaction applies:

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(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):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid:

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[_] Fee paid previously with preliminary materials.

[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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(2) Form, Schedule or Registration Statement No.:

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(3) Filing Party:

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(4) Date Filed:

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Notes:

<PAGE>

SPECIALTY TELECONSTRUCTORS, INC.
12001 Hwy. 14 North
Cedar Crest, New Mexico 87008

October __, 1997

DEAR STOCKHOLDER:

You are cordially invited to attend the annual meeting of the stockholders
(the "Annual Meeting") of Specialty Teleconstructors, Inc. (the "Company") to be
held on November 21, 1997, at 10:00 a.m., Mountain Standard Time, at the La
Posada de Albuquerque Hotel, 125 Second Street, N.W., Albuquerque, New Mexico
87102.

Matters to be considered and voted upon at the Annual Meeting include: (i)
proposals to amend the Company's Articles of Incorporation, as amended, to
provide for staggered terms for directors; the creation of a class of Preferred
Stock; increasing the number of shares of common Stock which the Company is
authorized to issue from 10,000,000 to 20,000,000; and special voting
requirements for amending the Company's Bylaws and Articles; (ii) the election
of six (6) directors to either staggered or one-year terms; (iii) a proposal to
approve and ratify the Company's 1997 Stock Incentive Plan; (iv) a proposal to
ratify certain stock options granted under the Company's 1997 Stock Incentive
Plan to employees of the Company or its subsidiaries in connection with certain
recent acquisitions; and (v) ratification of the Board of Directors' appointment
of KPMG Peat Marwick LLP, independent certified public accountants, as auditors
for the Company for the fiscal year ending June 30, 1998. A copy of the
Company's Annual Report on Form 10-KSB for the fiscal year ended June 30, 1997
accompanies this Proxy Statement.

We look forward to seeing you at the Annual Meeting. Whether or not you are
planning to attend, we urge you to return the enclosed proxy at your earliest
convenience.

Sincerely,

Michael R. Budagher
Chairman of the Board, President,
Chief Executive Officer and Treasurer
<PAGE>

SPECIALTY TELECONSTRUCTORS, INC.
12001 Hwy. 14 North
Cedar Crest, New Mexico 87008

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

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS

To Be Held On November 21, 1997

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

TO THE STOCKHOLDERS OF SPECIALTY TELECONSTRUCTORS, INC.:

The Annual Meeting of the Stockholders of Specialty Teleconstructors,
Inc., a Nevada corporation (the "Company"), will be held on November 21, 1997,
at 10:00 a.m., Mountain Standard Time, at the La Posada de Albuquerque Hotel,
125 Second Street, N.W., Albuquerque, New Mexico, 87102, for the following
purposes:

1. To amend the Company's Articles of Incorporation, as amended, to
provide for the following:

(a) Staggered terms for directors;

(b) The creation of a class of Preferred Stock;

(c) Increasing the number of shares of Common Stock which the
Company is authorized to issue from 10,000,000 to 20,000,000;
and

(d) Special voting requirements for amending the Company's
Bylaws and Articles.

2. (a) If Proposal 1(a) is approved, to elect a staggered Board of
Directors consisting of three classes to serve initially for
one, two and three-year terms, converting into three-year terms
upon expiration of the original term, and until their successors
are elected; or

(b) If Proposal 1(a) is not approved, to elect six directors to
serve one-year terms and until their successors are elected.

3. To consider and vote upon a proposal to approve and ratify the Company's
1997 Stock Incentive Plan.

4. To consider and vote upon a proposal to approve and ratify certain stock
options granted under the Company's 1997 Stock Incentive Plan to employees of
the Company or its subsidiaries in connection with certain recent acquisitions.

5. To ratify the appointment of KPMG Peat Marwick LLP as the Company's
independent auditors for the fiscal year ending June 30, 1998.

6. To transact any other business which may properly come before the Annual
Meeting or any adjournment(s) thereof.

The Board of Directors has fixed the close of business on October 20, 1997
as the record date for the determination of stockholders entitled to notice of,
and to vote at, the Annual Meeting and at any continuation or adjournment
thereof. A list of stockholders entitled to vote at the Annual Meeting will be
available for inspection at the Company's principal executive office.
<PAGE>

You are cordially invited to attend the Annual Meeting in person. Even if
you plan to attend the Annual Meeting, please promptly mark, sign, date and
return the enclosed proxy card in the envelope provided herewith. If you decide
to attend the Annual Meeting and wish to change your proxy vote, you may do so
at the Annual Meeting.

Please read the enclosed proxy material carefully. Your vote is important.
The Company appreciates your cooperation in considering and acting on the
matters presented.

Dated: October __, 1997 By Order of the Board of
Directors

DENNIS K. HARTNETT
Secretary

IT IS IMPORTANT THAT YOU COMPLETE AND RETURN THE ENCLOSED PROXY CARD. YOUR
COOPERATION IN PROMPTLY RETURNING YOUR SIGNED PROXY CARD CAN HELP THE COMPANY
AVOID THE EXPENSE OF DUPLICATE PROXY SOLICITATIONS.
<PAGE>

SPECIALTY TELECONSTRUCTORS, INC.
12001 Hwy. 14 North
Cedar Crest, New Mexico 87008

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

PROXY STATEMENT

To Be Held On November 21, 1997

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

GENERAL

The enclosed proxy is solicited by the Board of Directors of Specialty
Teleconstructors, Inc. (the "Company"), a Nevada corporation, for use at the
annual meeting of stockholders of the Company to be held on November 21, 1997,
at 10:00 a.m., Mountain Standard Time, at the La Posada de Albuquerque Hotel,
125 Second Street, N.W., Albuquerque, New Mexico, 87102, or any adjournment(s)
or postponement(s) thereof (the "Annual Meeting"). These proxy materials and the
related form of proxy were first mailed to the Company's stockholders on or
about October __, 1997.

The mailing address of the Company's principal executive offices is
12001 Hwy 14 North, Cedar Crest, New Mexico 87008.

PURPOSE OF ANNUAL MEETING

The specific proposals to be considered and acted upon at the Annual
Meeting are summarized in the accompanying Notice of Annual Meeting of
Stockholders. Each proposal is described in more detail in this Proxy Statement.

VOTING RIGHTS

The record date (the "Record Date") for determining those stockholders
who are entitled to notice of, and to vote at, the Annual Meeting has been fixed
as October 20, 1997. At the close of business on the Record Date, __________,
shares of the Company's Common Stock were issued and outstanding. Stockholders
will vote at the Annual Meeting as a single class on all matters, with each
holder of shares of Common Stock entitled to one vote per share held. All
matters submitted for stockholder approval at the Annual Meeting will be decided
by the affirmative vote of a majority of the voting power of the shares present
in person or represented by proxy at the Annual Meeting and entitled to vote on
each matter. Pursuant to the Company's Bylaws, no stockholder is entitled to
cumulate his or her votes.

The majority of the aggregate of the outstanding shares of the
Company's Common Stock entitled to vote will constitute a quorum for the
transaction of business at the Annual Meeting. Abstentions may be specified on
all proposals except the election of directors. Abstentions and broker nonvotes
(shares held by a broker or other nominee having discretionary power to vote on
some matters but not others) are counted as being present for purposes of
determining a quorum. If shares are not voted by the broker who is the record
holder of the shares, or if shares are not voted in other circumstances in which
proxy authority is defective or has been withheld with respect to any matter,
these nonvoted shares are not deemed to be present or represented for purposes
of determining whether stockholder approval of that matter has been obtained.

Properly executed proxies will be voted in the manner directed by the
stockholders. If no direction is made on proxies, such proxies will be voted FOR
the creation of staggered terms for directors, FOR the creation of a class of
Preferred Stock, FOR the increase in the number of shares of Common Stock which
the Company is authorized to issue from 10,000,000 to 20,000,000, FOR the
imposition of special voting requirements for amending the Company's Bylaws and
Articles, FOR the election of all nominees named under the caption "Election of
Directors" as directors of the Company, FOR the approval of the 1997 Stock
Incentive Plan, FOR the propsal to approve and ratify certain stock options
granted under the Company's 1997 Stock Incentive Plan to employees of the
Company or its subsidiaries in connection with certain recent acquisitions and
FOR the ratification of the selection of KPMG Peat Marwick LLP as the Company's
independent auditors for the fiscal year ending June 30, 1998.

1
<PAGE>

At the Record Date, directors and executive officers of the Company
may be deemed to be the beneficial owners of an aggregate of _________ shares of
Common Stock (excluding shares issuable upon exercise of outstanding stock
options) constituting approximately ____% of the total voting power of all of
the outstanding securities of the Company which are entitled to vote at the
Annual Meeting. Such directors and executive officers have indicated to the
Company that each such person intends to vote or direct the vote of all shares
of each class of Common Stock held or owned by such persons, or over which such
person has voting control, in favor of all of the Proposals. See "SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT."

REVOCABILITY OF PROXIES

The enclosed proxy is revocable at any time before it is voted. A
proxy may be revoked by the holder of record by filing with the Company's
Secretary, at the Company's principal executive office, a written notice of
revocation or a new duly executed proxy bearing a date later than the date
indicated on the previous proxy. Proxies may also be revoked by any stockholder
present at the Annual Meeting who elects to vote his or her shares in person.
Attendance at the Annual Meeting will not, by itself, revoke a proxy.

SOLICITATION

The enclosed proxy is being solicited by the Company's Board of
Directors. The Company will bear the entire cost of proxy solicitation,
including costs of preparing, assembling, printing and mailing this Proxy
Statement, the proxy card and any additional material furnished to the
stockholders. Copies of the solicitation materials will be furnished to
brokerage houses and others to forward to the beneficial owners. The Company may
reimburse such persons for their expenses in forwarding solicitation materials.
Solicitation will be made primarily through the use of the mail, but may be
supplemented by telephone, telegram or personal solicitation by directors,
officers or other regular employees of the Company.

In the discretion of management, the Company reserves the right to
retain a professional firm of proxy solicitors to assist in solicitation of
proxies. Although management does not currently expect to retain such a firm, it
estimates that the fees of such firm would range from $5,000 to $10,000 plus
out-of-pocket expenses, all of which would be paid by the Company.

ADDITIONAL INFORMATION

A copy of the Company's Annual Report on Form 10-KSB for the fiscal
year ended June 30, 1997 accompanies this Proxy Statement. In addition, the
Company will furnish without charge to any stockholder, upon written or oral
request, a copy of the Company's Annual Report on Form 10-KSB for the fiscal
year ended June 30, 1997 and other documents filed pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Securities Act of 1934, as amended (the "Exchange
Act"). Requests for such documents as well as any questions concerning the
voting of your shares should be directed to Dennis K. Hartnett, Corporate
Secretary of Specialty Teleconstructors, Inc., 12001 Hwy. 14 North, Cedar Crest,
New Mexico 87008, telephone number (505) 281-2197, ext. 102.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, as of October 8, 1997, the number and
percentage ownership of the Company's Common Stock by (i) all persons known to
the Company to beneficially own more than 5% of the outstanding Common Stock
(based upon reports filed by such persons with the Commission), (ii) each of the
named executive officers in the Summary Compensation Table which appears
elsewhere herein, (iii) each director of the Company and director nominee named
under "Election of Directors," and (iv) all executive officers and directors of
the Company as a group. To the Company's knowledge, except as otherwise
indicated, each of the persons named in this table has sole voting and

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<PAGE>

investment power with respect to the Common Stock shown as beneficially owned,
subject to community property and similar laws, where applicable.

<TABLE>
<CAPTION>
Name and Address of Amount and Nature of Percent
Beneficial Owner Beneficial Ownership of Class(1)
- ---------------- ----------------------- -----------
<S> <C> <C>
Michael R. Budagher 2,355,000(2) 29.4%
12001 Hwy 14 North
Cedar Crest, New Mexico 87001

Ernie L. Carpenter 0 0%
4740 Ridge Drive NE
Salem, Oregon 97303

Tommie R. Carpenter 2,380,000 29.7%
888 Coburn St. South
Salem, Oregon 97302

John D. Emery 11,500(3) *
1613 University Blvd.
Albuquerque, New Mexico 87102

Terry D. Farmer 8,000 *
Moses, Dunn, Farmer & Tuthill, P.C.
612 First Street N.W.
Albuquerque, New Mexico 87102

Dennis K. Hartnett 30,000(4) *
12001 Hwy 14 North
Cedar Crest, New Mexico 87001

Frank D. Lackey 268,000(5) 3.3%
15800 Sonoma Ct.
Edmond, Oklahoma 73013

Jon D. Word 10,000(3) *
10526 City Lights Drive, N.E.
Albuquerque, New Mexico 87111

All directors and executive officers as a group, 2,682,500(6) 33.5%
including those names above (7 persons)
</TABLE>

- ----------------
*Less than 1.0%

(1) Shares not outstanding but deemed beneficially owned by virtue of the right
of a person or member of a group to acquire them within 60 days are treated
as outstanding only when determining the amount and percent owned by such
person or group.
(2) Consists entirely of shares owned by the Budagher Family Limited
Partnership #1 (the "Budagher Family Partnership") of which Michael R.
Budagher is the sole general partner. As the sole general partner of the
Budagher Family Partnership, Michael R. Budagher has sole voting and
investment power with respect to these shares.
(3) Includes 10,000 shares subject to options exercisable within 60 days.
(4) Includes 30,000 shares subject to options exercisable within 60 days.
(Footnotes continued on following page)

3
<PAGE>

(5) Includes 252,000 shares owned by Mr. Lackey as Co-Trustee for the Frank D.
Lackey Revocable Trust and 16,000 shares owned by the Jo LaVern Lackey
Revocable Trust of which Mr. Lackey is Co-Trustee. Of the shares of Common
Stock beneficially owned by Mr. Lackey, Mr. Lackey has the shared power,
with Mrs. Lackey, to vote, or to direct the vote of, and to dispose, or to
direct the disposition of 268,000 shares and the sole power to vote, or to
direct the vote of, and to dispose, or to direct the disposition of 0
shares.
(6) Includes 50,000 shares subject to options exercisable within 60 days.

DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

The following table sets forth information regarding the directors, nominees for
director and executive officers of the Company:

Name Age Position
- ---- --- --------

Michael R. Budagher(1) 39 Chairman of the Board, President, Chief
Executive Officer, Treasurer and Director

Ernie L. Carpenter 57 Director

John D. Emery(2)(3) 49 Director

Terry D. Farmer(2)(3) 47 Acting Secretary and Director

Dennis K. Hartnett 43 Chief Accounting Officer, Secretary and
Assistant Treasurer

Frank D. Lackey 60 Director

Jon D. Word(2)(3) 36 Director

- --------------------
(1) Mr Budagher is the sole member of the Secondary Stock
Option Committee of the Board of Directors.
(2) Mr. Farmer served as Acting Secretary of the Company from June 14, 1996
until July 8, 1996.
(3) Mr. Hartnett was appointed Secretary and Assistant Treasurer of the Company
effective July 8, 1996.
(4) Member of the Compensation and Primary Stock Option Committee of the Board
of Directors.
(5) Member of the Audit Committee of the Board of Directors.

Directors hold office until their term expires and until their successors
have been elected and qualified. Officers are appointed annually and serve at
the discretion of the Board of Directors. There are no family relationships
among executive officers or directors and nominees for director of the Company.

Mr. Budagher founded the Company in 1981. Mr. Budagher has been Chairman of
the Board, President, Chief Executive Officer and a Director of the Company
since its inception and Treasurer of the Company since June, 1996. Mr. Budagher
is also a founder, stockholder and President of Specialty Antenna Site
Resources, Inc. ("SASR") and a founder and President of Specialty Constructors
Coatings, Inc. ("SCC"). See "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS."

Mr. Carpenter was elected to the Board of Directors in September, 1997.
From March, 1997 to the present, Mr. Carpenter has been President and Chief
Executive Officer of Microwave Tower Service, Inc., which became a wholly-owned
subsidiary of the Company on June 30, 1997. For more than five years prior to
March 1997, Mr. Carpenter was Controller of Microwave Tower Services, Inc.

Mr. Emery has been a Director of the Company since 1994. For more than
five years, Mr. Emery has been President of Corporate Development Center, Inc.,
a consulting firm specializing in assisting fast growth companies, arranging
mergers and acquisitions, rendering expert valuations, and providing crisis
management services to businesses.

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<PAGE>

In August, 1997, Mr. Emery founded Growth Dynamics, LLC, which provides
consulting and other services primarily to new or recently formed high
technology companies. Mr. Emery also teaches Entrepreneurship, Business Ethics
and Organizational Environment, and Business Policy and Strategy at the
University of New Mexico. Mr. Emery holds a Master of Business Administration
from the Harvard Business School.

Mr. Farmer has been a Director of the Company since 1994. Mr. Farmer has
been a stockholder, officer and director of the Albuquerque law firm of Moses,
Dunn, Farmer & Tuthill, P.C. for more than five years. Mr. Farmer is a past
President of the Albuquerque Lawyers Club and the Young Lawyers Division of the
State Bar of New Mexico. In 1994, Mr. Farmer was elected a fellow in the New
Mexico Bar Foundation. See " CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS."

Mr. Hartnett became employed by the Company in June, 1996 and was appointed
Chief Accounting Officer, Secretary and Assistant Treasurer of the Company in
July, 1996. From February, 1996 to June, 1996, Mr. Hartnett was Chief Financial
Officer of New Mexico Mortgage Company, Inc. From April, 1995 to February, 1996,
Mr. Hartnett was self-employed as an independent accounting and management
consultant. From March, 1991 to April, 1995, Mr. Hartnett was a Senior Asset
Manager for Northcorp Realty Advisors, Inc.

Mr. Lackey was elected to the Board of Directors in May, 1997. From May
14, 1997 to the present, Mr. Lackey has served as Chairman of the Board of Novak
& Lackey Construction Co., Inc., which became a wholly-owned subsidiary of the
Company on May 14, 1997. From March 1975 until May 14, 1997, Mr. Lackey was the
President and Chief Executive Officer of Novak & Lackey Construction Co., Inc.

Mr. Word has been a Director of the Company since 1994. Mr. Word has been
President and Chief Executive Officer of Contact New Mexico, L.P., a paging and
messaging service provider in New Mexico and Southern Colorado since August,
1992. Mr. Word also is an owner and director of Rural Telco, Inc., a cellular
telephone provider in North Carolina and is President and Director of Word SMR,
Inc. which holds specialized mobile radio licenses in several locations
throughout the United States. In 1991 and 1992, Mr. Word was a consultant in
the wireless telecommunications industry and from 1988 through 1991 he was Vice
President of Operations for Cellular Information Systems, Inc., a wireless
communications company. Mr. Word received a Bachelor of Science Degree from
Texas A&M University in 1984.

EXECUTIVE COMPENSATION

EXECUTIVE OFFICERS

The following table sets forth the compensation earned by Michael R.
Budagher, the Company's President, Chief Executive Officer and Treasurer, Ernie
L. Carpenter, the President and Chief Executive Officer of Microwave Tower
Service, Inc., an Oregon corporation ("MTS") and a wholly-owned subsidiary of
the Company and Frank D. Lackey, the Chairman of the Board of Novak & Lackey
Construction Co., Inc., an Oklahoma corporation ("N&L") and a wholly-owned
subsidiary of the Company ( the "Named Executive Officers") for each of the
three fiscal years ended June 30, 1997, 1996 and 1995. Except as set forth in
the following table, no executive officer of the Company received total cash
salary and bonus during the fiscal year ended June 30, 1997 exceeding $100,000.
No executive officer who would have otherwise been includable in such table on
the basis of salary and bonus earned for fiscal 1997 resigned or terminated
employment during that year.

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<PAGE>

SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
------------------- ----------------------
Awards Payouts
---------------------- -------
Other Restricted Securities All other
Name and Annual Stock Underlying LTIP Compen-
Principal Salary Bonus Comp. Award(s) Options/ Payouts sation
Position Year ($) ($) ($) ($) SARs(#) ($) ($)
- -------- ------ ------ -------- -------- -------- ---------- ------ ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Michael R. Budagher 1997 85,000 -- -- -- -- -- 850(1)
President, Chief Executive
Officer and Treasurer 1996 85,000 -- -- -- -- -- --
1995 100,000 -- -- -- -- -- 16,374(1)

Ernie L. Carpenter 1997 116,667 110,000 -- -- -- -- --
President and Chief 1996 50,000 35,000 -- -- -- -- --
Executive Officer 1995 50,000 15,000 -- -- -- -- --
Microwave Tower
Service, Inc.

Frank D. Lackey 1997 66,310 143,000 -- -- -- -- --
Chairman of the Board 1996 65,520 200,000 -- -- -- -- --
Novak & Lackey 1995 65,520 79,600 -- -- -- -- --
Construction Co., Inc.
</TABLE>
================================================================================
(1) Reflects employer contributions under the Specialty Constructors, Inc.
Profit Sharing Plan.

Stock Options, SARs, Long-Term Incentive Plan Awards

No stock options, SARs or awards under any long-term incentive plan were
granted to any Named Executive Officer in the fiscal year ended June 30, 1997.
At June 30, 1997 no Named Executive Officer held any unexercised stock options
or SARs and no such stock options or SARs were exercised during the fiscal year
ended June 30, 1997.

Employment Contracts, Termination of Employment Agreements and Change of Control
Arrangements

The Company currently has an employment agreement in effect with Dennis K.
Hartnett with respect to his service as the Company's Chief Accounting Officer.
Mr. Hartnett's employment agreement was entered into on June 30, 1996 and
provides for his employment by the Company as its Chief Accounting Officer at an
annual salary of $75,000 and the grant to Mr. Hartnett of options to purchase
30,000 shares of Common Stock pursuant to the Company's Amended and Restated
1994 Stock Option Plan (the "Restated 1994 Stock Option Plan"). Mr. Hartnett's
employment agreement expires June 30, 2000 unless extended by the parties and
contains confidentiality, non-disclosure and non-compete provisions.

MTS currently has an employment agreement in effect with Mr. Carpenter with
respect to his service as President and Chief Executive Officer of MTS and N&L
also a wholly-owned subsidiary of the Company, currently has an employment
agreement in effect with Mr. Lackey with respect to his service as Chairman of
the Board of N&L.

Mr. Carpenter's employment agreement was entered into on June 30, 1997 and
provides for his continued employment by MTS as its President and Chief
Executive Officer at an annual salary of $150,000. Mr. Carpenter's employment
agreement expires June 30, 2000 unless extended by the parties and contains
confidentiality, non-disclosure and non-compete provisions.

6
<PAGE>

Mr. Lackey's employment agreement was entered into on May 14, 1997 and
provides for his continued employment by N&L as its Chairman of the Board at an
annual salary of $50,000. Mr. Lackey's employment agreement expires May 14,
1999 unless extended by the parties and contains confidentiality, non-disclosure
and non-compete provisions.

With the exception of Mr. Hartnett, the Company does not currently have any
employment contracts in effect with any of its executive officers. The Company
provides incentives such as salary, benefits and option grants (which are
typically subject to a three year vesting schedule) to attract and retain
executive officers and other key employees.

On June 30, 1997, the Company, through a wholly-owned subsidiary, merged
(the "MTS Merger") with Microwave Tower Service, Inc., an Oregon corporation
("MTS"). In connection with the MTS Merger, the Company issued 2,380,000 shares
of Common Stock to the former sole stockholder of MTS for all of the outstanding
shares of MTS common stock. As a result of the MTS Merger, MTS became a wholly-
owned subsidiary of the Company. Also as result of the MTS Merger, the vesting
schedules for all options under the Restated 1994 Stock Option Plan outstanding
on June 30, 1997 were accelerated.

The Compensation and Primary Stock Option Committee, as Plan Administrator
of the 1997 Stock Incentive Plan, will have the authority to provide for the
accelerated vesting of the shares of Common Stock subject to any outstanding
options held by such individual, in connection with the termination of the
individual's employment following an acquisition in which these options are
assumed or the repurchase rights with respect to the unvested shares are
assigned or certain hostile changes in control of the Company. Other than such
accelerated vesting, there is no agreement or policy which would entitle any
executive officers to severance payments or any other compensation as a result
of such officer's termination.

Compensation of Directors

Directors receive $500 for each Board of Directors meeting attended and
reimbursement for expenses incurred in attending such meetings. In addition,
Directors who serve on committees receive $100 per hour for time spent attending
meetings of such committees.

Equity Incentive Plans

The Restated 1994 Stock Option Plan

The Company's 1994 Stock Option Plan was approved by the Board of Directors
and Stockholders of the Company on May 16, 1994 to provide for the grant of
incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986 as amended. A total of 100,000 shares of Common Stock was
originally authorized and reserved for issuance under the 1994 Stock Option Plan
subject to adjustment to reflect changes in the Company's capitalization in the
case of a stock split, stock dividend or similar event. During fiscal 1996, the
Board of Directors approved the amendment and restatement of the 1994 Stock
Option Plan (as amended and restated, the "Restated 1994 Stock Option Plan") to
increase the number of shares authorized for issuance under the Company's 1994
Stock Option Plan from 100,000 to 400,000. The Restated 1994 Stock Option Plan
and the grant of certain options under the Restated 1994 Stock Option Plan to
employees and advisors during fiscal 1996 were approved by a vote of the
holders of a majority of the Company's outstanding Common Stock on November 1,
1996. The Restated 1994 Stock Option Plan is administered by the Compensation
and Primary Stock Option Committee, which consists of the Company's three
Outside Directors. Under the Restated 1994 Stock Option Plan, the term "Outside
Directors" means only those directors of the Company or a subsidiary of the
Company who are not regular salaried employees of either the Company or a
subsidiary as of the date the option is granted. The Compensation Committee has
the sole authority to interpret the Restated 1994 Stock Option Plan; provided
that, (i) the exercise price of each option granted under the Restated 1994
Stock Option Plan may not be less than the fair market value of the Common Stock
on the day of the grant of the option, (ii) the exercise price must be paid in
cash and or stock upon exercise of the option, (iii) no option may be
exercisable for more than ten (10) years after the date of grant, and (iv) no
option is transferable other than by will or the laws of

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<PAGE>

descent and distribution. No option is exercisable after an optionee who is an
employee of the Company ceases to be employed by the Company or a subsidiary of
the Company, subject to the right of the Compensation Committee to extend the
exercise period for not more than 90 days following the date of termination of
an optionee's employment. An optionee who was a director or advisor may exercise
his option at any time within 90 days after such optionee's status as a director
or advisor terminates to the extent he was entitled to exercise such option at
the date of termination of his status. If an optionee's employment is
terminated by reason of disability, the Compensation Committee has the authority
to extend the exercise period for not more than one year following the date of
termination of the optionee's employment or service as an advisor or director.
If an optionee dies and shall hold options not fully exercised, such options may
be exercised in whole or in part within one year of the optionee's death by the
executors or administrators of the optionee's estate or by the optionee's heirs.

As of October 8, 1997, (i) 394,325 options had been issued under the
Restated 1994 Stock Option Plan of which 44,955 had been exercised and 349,370
remained outstanding, and (ii) 5,675 options remained available for future
issuance under the Restated 1994 Stock Option Plan. A total of 315,000 options
were granted under the Restated 1994 Stock Option Plan during the fiscal year
ended June 30, 1997.

As result of the MTS Merger, all options issued and outstanding under the
Restated 1994 Stock Option Plan on June 30, 1997 (394,325 options) vested and
became exercisable.

The Outside Directors' Stock Option Plan

The Company's 1994 Outside Directors' Stock Option Plan (the "Outside
Directors' Stock Option Plan") was approved by the Board of Directors and
Stockholders of the Company on May 16, 1994. A total of 50,000 shares of Common
Stock has been authorized and reserved for issuance under the Outside Directors'
Stock Option Plan, subject to adjustment to reflect changes in the Company's
capitalization in the case of a stock split, stock dividend or similar event.
The Outside Directors' Stock Option Plan is currently administered by the entire
Board of Directors. Currently, the Board of Directors has the sole authority to
interpret the Outside Directors' Stock Option Plan to determine the persons to
whom options will be granted, to determine the basis upon which the options will
be granted and to determine the exercise price, duration and other terms of
options to be granted under the Outside Directors' Stock Option Plan; provided
that, (i) the exercise price of each option granted under the Plan may not be
less than the fair market value of the Common Stock on the day of the grant of
the option, (ii) the exercise price must be paid in cash and or stock upon
exercise of the option, (iii) no option may be exercisable for more than 10
years after the date of grant, and (iv) no option is transferable other than by
will or the laws of descent and distribution. If an optionee's status as an
Outside Director is terminated for any reason other than death, the optionee may
exercise his option at any time within 90 days after such termination to the
extent it was then exercisable. If an optionee dies while an Outside Director
and shall not have fully exercised options granted under the Outside Directors'
Stock Option Plan, such options may be exercised in whole or in part within six
months of the optionee's death by the executors or administrators of the
optionee's estate or by the optionee's heirs. The vesting period, if any,
specified for each option will be accelerated upon the occurrence of a change of
control or threatened change of control of the Company.

Options under the Outside Directors' Stock Option Plan are granted only to
Outside Directors. Under the Outside Directors' Stock Option Plan, the term
"Outside Directors" means only those directors of the Company or a subsidiary of
the Company who are not regular salaried employees of either the Company or a
subsidiary as of the date the option is granted. No stock options were granted
under the Outside Directors Stock Plan during the fiscal year ended June 30,
1997. As of October 8, 1997, (i) 30,000 options had been issued under the
Outside Directors' Stock Option Plan, of which 10,000 had been exercised and
20,000 remained outstanding and currently exercisable, and (ii) 20,000 options
remained available for future issuance under the Outside Directors' Stock Option
Plan.

Options issued under the Outside Directors' Stock Option Plan are not
transferable or assignable by an optionee, voluntarily or by operation of law,
other than by will or the laws of descent and distribution or pursuant to a
qualified domestic relations order. Each option is exercisable, during the
optionee's lifetime, only by the optionee, his guardian or legal representative.

8
<PAGE>

The 1997 Stock Incentive Plan

The Company's stockholders are being asked to approve the 1997 Stock
Incentive Plan (the "1997 Stock Incentive Plan") under which 500,000 shares of
the Company's Common Stock will be reserved for issuance. The Board of Directors
has authorized the implementation of the 1997 Stock Incentive Plan as a
comprehensive equity incentive program to attract and retain the services of
those individuals essential to the Company's growth and financial success. The
1997 Stock Incentive Plan will become effective upon the approval of the
stockholders at the 1997 Annual Meeting (the "Effective Date"). Please see the
discussion set forth herein under Proposal III.

COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Section 16(a) of the Exchange Act requires the Company's officers and
directors and persons who own more than ten percent of the Company's Common
Stock to file reports of ownership and changes in ownership with the Securities
and Exchange Commission. Officers, directors and greater than ten-percent owners
are required by the Securities and Exchange Commission regulations to furnish
the Company with copies of all Section 16(a) forms they
file.

Based solely on the Company's review of the copies of such forms received
by it, the Company believes that, during the fiscal year ended June 30, 1997,
all filing requirements applicable to its officers, directors and greater than
ten-percent owners were complied with except that Terry D. Farmer failed to
timely file one Form 5 and Dennis K. Hartnett failed to timely file one Form 3.
The required filings have since been made.

MATTERS TO BE ACTED UPON BY THE STOCKHOLDERS AT THE ANNUAL MEETING.

PROPOSALS 1(a)-(d)

AMENDMENTS TO RESTATED ARTICLES OF INCORPORATION

The Board of Directors of the Company has adopted resolutions proposing
amendments (the "Proposed Amendments") to the Company's existing Articles of
Incorporation, as amended (the "Current Articles"), which amendments would have
the effect of reducing the likelihood that the Company would be subject to a
change of control or delaying such a change of control. The Proposed Amendments
are not in response to any change of control activity of which management of the
Company is aware. The Proposed Amendments are attached hereto as Exhibit A.

PROPOSAL 1(a)

AMENDMENT TO CURRENT ARTICLES TO PROVIDE FOR
STAGGERED TERM FOR DIRECTORS

The Board of Directors of the Company has adopted a resolution proposing an
amendment to the Current Articles that would provide for staggered terms for the
directors, effective immediately and affecting the Board of Directors elected at
the Annual Meeting. Under the proposed amendment, the Board of Directors shall
be divided into three classes if the number of directors is four or more, with
the classes to be as equal in number as may be possible. Any director or
directors in excess of the number divisible by three shall be first assigned to
Class 1, and any additional director shall be assigned to Class 2, as the case
may be. (For example, if there are five directors, the fourth director shall be
in Class 1 and the fifth director in Class 2.) If the proposed amendment is
approved by the stockholders, the Board of Directors shall be divided into three
classes with each Class 1 director elected to serve until the next ensuing
annual

meeting of stockholders, each Class 2 director elected to serve until the
second ensuing annual meeting of stockholders, and each Class 3 director
elected to serve until the third ensuing annual meeting of stockholders. At
each annual meeting of stockholders following the Annual Meeting, the number of
directors equal to the number of directors in a class whose term expires at the
time of such meeting shall be elected to serve until the third ensuing annual
meeting of stockholders.

9
<PAGE>

The proposed amendment also provides that notwithstanding the foregoing,
directors shall serve until their successors are elected and qualified or until
their earlier death, resignation or removal from office, or until there is a

decrease in the number of directors; provided, however, that no decrease in the
number of directors shall have the effect of shortening the term of any
incumbent director.

The Current Articles provide that the directors shall be elected annually
at each annual meeting of stockholders. Notwithstanding the foregoing, the
directors shall serve until their successors are elected and qualified or until
their earlier death, resignation or removal from office or until there is a
decrease in the number of directors.

The Board of Directors believes that a staggered Board will provide
additional continuity to its management by having directors serve for a longer
period of time, without standing for reelection each year. Also, a staggered
Board will help to assure the continuity and stability of the Company's
management and policies in the future since a majority of the Board at any given
time will have prior experience as Board members.

A staggered Board is also designed to reduce the vulnerability of the
Company to an unsolicited takeover proposal. The Company believes that if a
potential acquiror were to purchase a significant amount of controlling interest

in the Company, such potential acquiror's ability to remove the Company's
directors and obtain control of the Board and thereby remove the Company's
management would severely curtail the Company's ability to negotiate effectively
with the potential acquiror. A staggered Board would reduce the likelihood of a
total change in control, thereby allowing the Board the ability to take the time
and gather the information necessary to evaluate a proposal and to study
alternative proposals and to help ensure that the best price is obtained in any
transaction.

Conversely, a staggered Board would make it more difficult to change
control of the Company by removing and replacing all or a majority of the Board.
Since not all directors would stand for election at a single stockholders'
meeting, as is the case now, stockholders desiring to change control would have
to vote at multiple meetings in order to do so, requiring at least two annual
meetings to remove and replace a majority of the directors of the Company, and
three annual meetings to remove and replace the entire Board. Likewise, a
staggered Board may discourage a potential acquiror from making a tender offer
(including an offer at a substantial premium over the then-prevailing market
value of the Common Stock), even though such an attempt might be beneficial to
the Company and its stockholders. By reducing the attractiveness of
accumulating large blocks of Common Stock and subsequently changing control of
the Company, adoption of the amendment could tend to reduce any temporary
fluctuation in the market price of the Common Stock that is caused by such
accumulations. Accordingly, stockholders could be deprived of certain
opportunities to sell their stock at a temporarily higher market price.

See "ADVANTAGES AND DISADVANTAGES OF PROPOSED AMENDMENTS," below, for
further discussion of factors that should be considered by stockholders in
making their voting decision.

STOCKHOLDER APPROVAL

The affirmative vote of a majority of the outstanding voting shares of the
Company present or represented by proxies and entitled to vote at the Annual
Meeting is required for approval of this proposal. If such approval is obtained,
such amendment will become effective upon the filing by the Company of Articles
of Amendment to the Company's Articles of Incorporation, as amended, with the
Secretary of the State of Nevada, which is expected to be accomplished as soon
as practicable after stockholder approval is obtained.

RECOMMENDATION OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
"FOR" THIS PROPOSAL.

10
<PAGE>

PROPOSAL 1(b)

AMENDMENT TO CURRENT ARTICLES TO PROVIDE FOR
CREATION OF CLASS OF PREFERRED STOCK

The Board of Directors of the Company has adopted a resolution proposing an
amendment to the Current Articles that would give the Board of Directors the
authority, without further action by the stockholders, to issue up to 2,000,000
shares of Preferred Stock in one or more series and to fix the number of shares
constituting any such series and the preferences, limitations and relative
rights, including dividend rights, dividend rate, voting rights, terms of
redemption, redemption price or prices, conversion rights and liquidation
preferences of the shares constituting any series. The Current Articles do not
authorize the issuance of Preferred Stock.

The issuance of Preferred Stock could adversely affect the voting power and
other rights of the holders of Common Stock. Preferred Stock may be issued
quickly with terms calculated to delay or prevent a change in control of the
Company or make removal of management more difficult. As a result, the Board's
ability to issue Preferred Stock may discourage the potential hostility of an
acquiror, possibly resulting in beneficial negotiations. Negotiating with an

unfriendly acquiror may result in, among other things, terms more favorable to
the Company and its stockholders.

Conversely, the issuance of Preferred Stock may adversely affect the market
price of, and the voting and other rights of the holders of, the Common Stock.

See "ADVANTAGES AND DISADVANTAGES OF PROPOSED AMENDMENTS," below, for
further discussion of factors that should be considered by stockholders in
making their voting decision.

STOCKHOLDER APPROVAL

RECOMMENDATION OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
"FOR" THIS PROPOSAL.

PROPOSAL 1(c)

AMENDMENT TO CURRENT ARTICLES TO INCREASE THE NUMBER OF
AUTHORIZED SHARES OF COMMON STOCK FROM
10,000,000 to 20,000,000

The Board of Directors of the Company has adopted a resolution proposing an
amendment to the Current Articles that would increase the number of shares of
Common Stock which the Company is authorized to issue from 10,000,000 to
20,000,000. The Board of Directors determined that such an amendment is
advisable and directed that the proposed amendment be considered by the
Company's stockholders at the Annual Meeting.

11
<PAGE>

Purposes and Effects of Increasing the Number of Authorized Shares of Common
Stock

The proposed amendment would increase the number of shares of Common Stock
which the Company is authorized to issue from 10,000,000 to 20,000,000. The
additional 10,000,000 shares, if and when used, would have the same rights and
privileges as the shares of Common Stock presently issued and outstanding. The
holders of Common Stock of the Company are not entitled to preemptive rights or
cumulative voting.

As of October 8, 1997, the Company had 8,008,784 shares of Common Stock
issued and outstanding. In addition, as of such date, an aggregate of
approximately 616,015 shares of Common Stock were reserved or allocated for
issuance by the Company (i) pursuant to the Company's Restated 1994 Stock Option
Plan; (ii) upon exercise of the Underwriter's Warrants issued in connection with
its 1994 initial public offering and the Redeemable Common Stock Purchase
Warrants underlying said Underwriter's Warrants; (iii) pursuant to its Outside
Directors Option Plan; and (iv) subject to approval by the Company's
stockholders of Proposal 3 and Proposal 4 described below, pursuant to the
Company's 1997 Stock Incentive Plan. Subject to approval by the Company's
stockholders of Proposal 3 described below, an additional 500,000 shares of
Common Stock were reserved for issuance by the Company pursuant to the Company's
1997 Stock Incentive Plan.

After taking into account the number of issued and outstanding shares of
Common Stock together with the shares of Common Stock reserved or allocated for
issuance by the Company, as of October 8, 1997, the Company had 1,596,171 shares
of Common Stock which remain unreserved for issuance if Proposal 3 described
below is not approved by the Company's stockholders and 1,096,171 shares of
Common Stock which remain unreserved for issuance if Proposal 3 described below
is so approved. The Board of Directors recommends the proposed increase in the
authorized number of shares of Common Stock to ensure that an adequate number of
authorized and unissued shares is available principally for (i) the raising of
additional capital for the operations of the Company and (ii) the financing of
the acquisitions of other businesses. Except as described above, there are
currently no plans or arrangements relating to the issuance of any of the
additional shares of Common Stock proposed to be authorized and such shares
would be available for issuance without further action by stockholders, unless
required by the Company's Articles of Incorporation, its By-Laws or by
applicable law.

The increase in the number of authorized shares of Common Stock has not
been proposed for any anti-takeover-related purpose, and the Board of Directors
and management of the Company have no knowledge of any current effort to obtain
control of the Company or accumulate large amounts of its Common Stock. However,
the availability of additional shares of Common Stock could make any attempt to
gain control of the Company or of the Board of Directors more difficult. Shares
of authorized but unissued Common Stock could be issued in an effort to dilute
the stock ownership and voting power of any person or entity desiring to acquire
control of the Company, which might have the effect of discouraging or making
less likely such a change of control. Such shares could also be issued to other
persons or entities who support the Board of Directors in opposing a takeover
attempt that the Board of Directors has deemed not to be in the best interests
of the Company and its stockholders.

See "ADVANTAGES AND DISADVANTAGES OF PROPOSED AMENDMENTS," below, for
further discussion of factors that should be considered by stockholders in
making their voting decision.

STOCKHOLDER APPROVAL

12
<PAGE>

RECOMMENDATION OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
"FOR" THIS PROPOSAL.

PROPOSAL 1(d)

AMENDMENT TO CURRENT ARTICLES TO PROVIDE FOR SPECIAL VOTING REQUIREMENTS
FOR AMENDING BYLAWS AND ARTICLES

The Board of Directors of the Company has adopted a resolution proposing an
amendment to the Current Articles that would require the vote of a majority of
"Continuing Directors" (defined as a director who was a member of the Company's
Board on November 21, 1997 or a director who is elected to the Board after
November 21, 1997, after a nomination from a majority of the existing Continuing
Directors) to amend or repeal a Bylaw, unless the stockholders

expressly have provided that a Bylaw may not be amended or repealed by the
Board. Alternatively, a supermajority of two-thirds of the stockholders may
vote to amend or repeal the Bylaws.

The proposed amendment requires a supermajority vote of two-thirds of each
voting group of the stockholders to either amend or repeal provisions contained
in the Articles unless the desired amendment or repealed provision was

previously approved by a majority of Continuing Directors, in which case only a
majority vote of each voting group of stockholders is necessary.

The Current Articles provide that the Board of Directors has the power to
amend or repeal the Company's Bylaws, provided that the stockholders have not
expressly provided otherwise. Additionally, the Current Articles provide that a
majority of the stockholders may amend or repeal the Bylaws of the Company.
Currently, the Articles of the Company may be only amended or repealed with the
approval of a simple majority of the stockholders.

The Board of Directors believes that the proposed amendment's special
requirements for amending the Company's Bylaws and Articles would further
protect the Company from unsolicited change of control attempts and are
necessary to fulfill the intent of the proposed amendments contained in
Proposals 1(a), (b), (c) and (e). For example, a supermajority requirement for
amending the provisions contained in Proposal 1(a) would prevent a stockholder,
or a group of stockholders with a majority of the Company's Common Stock from
avoiding the requirement of a staggered Board by simply amending the Company's
Restated Articles to delete the provisions. The supermajority requirement
thereby assists management in retaining their positions.

See "ADVANTAGES AND DISADVANTAGES OF PROPOSED AMENDMENTS," below, for
further discussion of factors that should be considered by stockholders in
making their voting decision.

STOCKHOLDER APPROVAL

RECOMMENDATION OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS VOTE
"FOR" THIS PROPOSAL.

13
<PAGE>

ADVANTAGES AND DISADVANTAGES OF PROPOSED AMENDMENTS

The Proposed Amendments set forth in Proposals 1(a)-(d) have both
advantages and disadvantages to stockholders. The Proposed Amendments do not
prevent a purchase of all or a majority of the equity securities of the Company,
whether pursuant to open-market purchases, negotiated purchases from large
stockholders or an unsolicited bid for all or part of the securities of the
Company. Rather, the Board believes that the Proposed Amendments would

discourage disruptive tactics and encourage persons who may seek to acquire
control of the Company to initiate such an acquisition through negotiations with
the Board. The Board believes that it will therefore be in a better position to
protect the interests of all the stockholders. Furthermore, the stockholders
will have a more meaningful opportunity to evaluate any such action. Although
the Proposed Amendments are intended to encourage persons seeking to acquire

control of the Company to initiate such an acquisition through arm's length
negotiations with the Board, the overall effect of the Proposed Amendments may
be to discourage a third party from making a tender offer for a portion or all
of the Company's Common Stock, or otherwise attempting to obtain a substantial
position in the equity securities of the Company, by preventing such third party
from immediately removing and replacing the incumbent directors.

To the extent any potential acquirors are deterred by the Proposed
Amendments, the Proposed Amendments may have the effect of preserving the
incumbent management in office. The Proposed Amendments may also serve to
benefit incumbent management by making it more difficult to remove management
even when the only reason for the proposed change of control of the stockholder
action may be the unsatisfactory performance of the present directors. In
addition, since the Proposed Amendments are in part designed to discourage
accumulations of large blocks of the Company's voting shares by purchasers whose
objective is to have such voting shares repurchased by the Company at a premium,
their adoption could tend to reduce the temporary fluctuations in the market
price of such voting shares that are caused by such accumulations. Accordingly,
stockholders could be deprived of certain opportunities to sell their shares at
a temporarily higher market price.

Takeovers or changes in the Board of Directors that are effected without
prior consultation and negotiation with the Company would not necessarily be
detrimental to the Company and its stockholders. However, the Board feels that
the benefits of seeking to protect the ability of the Company to negotiate
effectively, through directors who have previously been elected by the
stockholders as a whole and are familiar with the Company, outweigh any
disadvantage of discouraging such unsolicited proposals. The Proposed Amendments
are not in response to any specific efforts of which the Company is aware to
accumulate shares of Common Stock or obtain control of the Company. The Board
is recommending the adoption of the Proposed Amendments in order to further
continuity and stability in the leadership and policies of the Company and to
discourage certain types of tactics that could involve actual or threatened
changes of control that are not in the best interests of the stockholders.
Because of the time associated with obtaining stockholder approval, the Board of
Directors believes it is inadvisable to defer consideration of the Proposed
Amendments until a takeover threat is pending. Once a specific threat exists,
the time required to adopt the Proposed Amendments may render their adoption
impractical prior to the completion of the takeover. Further, the absence of a
specific threat permits stockholders to consider the merits of the Proposed
Amendments outside the pressured atmosphere of a takeover threat. For these
reasons, the Company believes it is prudent to consider the Proposed Amendments
at this time.

Except as disclosed herein, the Board of Directors does not currently
contemplate recommending the adoption of any further amendments to the Articles
or any other action designed to affect the ability of third parties to take over
or change control of the Company.

14
<PAGE>

PROPOSAL 2

ELECTION OF DIRECTORS

Election

The Restated By-Laws of the Company provide that the Board of Directors
shall be composed of one (1) to nine (9) Directors, with such number to be fixed
by the Board of Directors. Currently, the number of Directors of the Company, as
fixed by the Board of Directors, is six (6) Directors. The Current Articles
currently provide that directors serve one-year terms until the next annual
meeting of stockholders and until their successors are elected and qualified.

(a) IF PROPOSAL 1(a) APPROVED. If Proposal 1(a) is approved by the
stockholders at the Annual Meeting, the directors of the Company would be
divided into three classes. Following the Annual Meeting, one class of
directors would be elected each year, and the members of such class would hold
office for a three-year term and until their successors are duly elected and
qualified, or until their death, resignation or removal from office. At the
Annual Meeting, two Class 1 directors would be elected, each to serve a one-year
term until the 1998 Annual Meeting and until their successors are elected and
qualified. At the 1998 Annual Meeting, two Class 1 directors would be elected
for a three-year term. The nominees for Class 1 directors are Terry D. Farmer
and Frank D. Lackey. At the Annual Meeting, two Class 2 directors would be
elected, each to serve a two-year term until the 1999 Annual Meeting and until
their successors are elected and qualified. At the 1999 Annual Meeting, two
Class 2 directors would be elected for a three-year term. The nominees for
Class 2 directors are John D. Emery and Jon D. Word. At the Annual Meeting, two
Class 3 directors will be elected for a three-year term until the 2000 Annual
Meeting and until their successors are elected and qualified. At the 2000
Annual Meeting, Class 3 directors would be elected for a three-year term. The
nominees for Class 3 directors are Michael R. Budagher and Ernie L. Carpenter.
All of the nominees for the three classes are currently members of the Board of
Directors of the Company.

(b) IF PROPOSAL 1(a) NOT APPROVED. If Proposal 1(a) is not approved by the
stockholders at the Annual Meeting, then six (6) directors will be elected at
the Annual Meeting, each to serve for a one-year term until the 1998 Annual
Meeting and until their successors are elected and qualified. The nominees are
Michael R. Budagher, Ernie L. Carpenter, John D. Emery, Terry D. Farmer, Frank
D. Lackey and Jon D. Word, all of whom are currently members of the Board of
Directors of the Company.

The persons named on the enclosed proxy (the proxy holders) will vote for
election of the Nominees either (a) for staggered terms if Proposal 1(a) is
approved by the stockholders at the Annual Meeting or (b) for one-year terms if
Proposal 1(a) is not approved, unless you have withheld authority for them to do
so on your proxy card. In the unanticipated event that a Nominee is unable or
declines for good cause to serve as a director at the time of the Annual
Meeting, the proxies will be voted for any nominee named by the current Board of
Directors to fill the vacancy. As of the date of this Proxy Statement, the
Board of Directors is not aware of any Nominee who is unable and/or will decline
to serve as a director. There is no cumulative voting for election of
directors.

Stockholders are asked to vote for the election of directors both if
Proposal 1(a) is approved by the stockholders at the Annual Meeting (indicated
on the attached Proxy as "2(a)") and if Proposal 1(a) is not approved (indicated
on the attached Proxy as "2(b)").

The Board of Directors unanimously recommends a vote for the election of
its nominees as directors, either (a) for staggered terms if Proposal 1(a) is
approved by the stockholders at the Annual Meeting or (b) for one-year terms if
Proposal 1(a) is not approved.

Set forth below is certain information with respect to the persons
nominated by the Board of Directors. With respect to each such person, such
information includes his age, the period during which he has served as a
Director of the Company and his principal occupation and employment during the
past five years. Each of the nominees has consented to be named as a nominee in
this Proxy Statement and to serve as a Director if elected.

15
<PAGE>

The six (6) Directors are required to be elected by a plurality of the
votes cast as to the subject Board seat. Votes may be cast in favor of or
withheld for any or all of the appropriate nominees. Unless otherwise instructed
by a record holder submitting a proxy, the persons named in a proxy will vote
the shares represented thereby for the election of all such appropriate
nominees. Abstentions and broker non-votes will not be counted toward a
nominee's achievement of a plurality and thus will have no effect on the outcome
of the election of Directors.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR EACH OF THE
NOMINEES LISTED BELOW.

NOMINEES FOR ELECTION AS DIRECTOR
---------------------------------

Name Age Description
- ---- --- -----------

Michael R. Budagher(1) 39 Mr. Budagher founded the Company in 1981 and has
been Chairman of the Board, President, Chief
Executive Officer and a Director of the Company
since its inception. Mr. Budagher was appointed
Treasurer of the Company in June, 1996. Mr.
Budagher is also a founder, stockholder and
President of Specialty Antenna Site Resources,
Inc. ("SASR") and a founder, stockholder and
President of Specialty Constructors Coatings, Inc.
("SCC"). See "CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS."

Ernie L. Carpenter 57 Mr. Carpenter was elected to the Board of
Directors in September, 1997. From March, 1997 to
the present, Mr. Carpenter has been President and
Chief Executive Officer of Microwave Tower
Service, Inc., which became a wholly-owned
subsidiary of the Company on June 30, 1997. For
more than five years prior to March 1997, Mr.
Carpenter was Controller of Microwave Tower
Services, Inc.

John D. Emery(2)(3) 49 Mr. Emery has been a Director of the Company since
1994. For more than five years, Mr. Emery has been
President of Corporate Development Center, Inc., a
consulting firm specializing in assisting fast
growth companies, arranging mergers and
acquisitions, rendering expert valuations, and
providing crisis management services to
businesses. In August, 1997, Mr. Emery founded
Growth Dynamics, LLC, which provides consulting
and other services primarily to new or recently
formed high technology companies. Mr. Emery also
teaches Entrepreneurship, Business Ethics and
Organizational Environment, and Business Policy
and Strategy at the University of New Mexico. Mr.
Emery holds a Master of Business Administration
from the Harvard Business School.

Terry D. Farmer(2)(3) 47 Mr. Farmer has been a Director of the Company
since 1994. Mr. Farmer has been a stockholder,
officer and director of the Albuquerque law firm
of Moses, Dunn, Farmer & Tuthill, P.C. for more
than five years. Mr. Farmer is a past President of
the Albuquerque Lawyers Club and the Young Lawyers
Division of the State Bar of New Mexico. In 1994,
Mr. Farmer was elected a fellow in the New Mexico
Bar Foundation. See "CERTAIN RELATIONSHIPS AND
RELATED TRANSACTIONS."

- --------------------
(1) Member of the Secondary Stock Option Committee.
(2) Member of the Audit Committee.
(3) Member of the Compensation and Primary Stock Option Committee.
(Table Continued on following page)

16
<PAGE>

NOMINEES FOR ELECTION AS DIRECTOR (continued)

Name Age Description
- ---- --- -----------

Frank D. Lackey 60 Mr. Lackey was elected to the Board of Directors
in May, 1997. From May 14, 1997 to the present,
Mr. Lackey has served as Chairman of the Board of
Novak & Lackey Construction Co., Inc., which
became a wholly-owned subsidiary of the Company on
May 14, 1997. From March 1975 until May 14, 1997,
Mr. Lackey was the President and Chief Executive
Officer of Novak & Lackey Construction Co., Inc.

Jon D. Word(2)(3) 36 Mr. Word has been a Director of the Company since
1994. Mr. Word has been President and Chief
Executive Officer of Contact New Mexico, L.P., a
paging and messaging service provider in New
Mexico and Southern Colorado since August, 1992.
Mr. Word also is an owner and director of Rural
Telco, Inc., a cellular telephone provider in
North Carolina and is President and Director of
Word SMR, Inc. which holds specialized mobile
radio licenses in several locations throughout the
United States. In 1991 and 1992, Mr. Word was a
consultant in the wireless telecommunications
industry, and from 1988 through 1991, he was Vice
President of Operations for Cellular Information
Systems, Inc., a wireless communications company.
Mr. Word received a Bachelor of Science Degree
from Texas A&M University in 1984.

- --------------------
(1) Member of the Secondary Stock Option Committee.
(2) Member of the Audit Committee.
(3) Member of the Compensation and Primary Stock Option Committee.

The Board of Directors acts as a nominating committee for selecting
nominees for election as directors. The Company's Restated Bylaws also permit
stockholders to make nominations for the election of directors, if such
nominations are made pursuant to timely notice in writing to the Company's
Secretary. To be timely, notice must be delivered to, or mailed to and received
at, the principal executive offices of the Company not less than 60 days nor
more than 90 days prior to the date of the meeting, provided that at least 60
days' notice or prior public disclosure of the date of the meeting is given or
made to stockholders. If less than 60 days' notice or prior public disclosure
of the date of the meeting is given or made to stockholders, notice by the
stockholder to be timely must be received by the Company not later than the
close of business on the tenth day following the date on which such notice of
the meeting was mailed or such public disclosure was made. Public disclosure of
the date of the Annual Meeting was made by the issuance of a press release on
October 14, 1997. A stockholder's notice of nomination must also set forth
certain information specified in Section 2.6.2 of the Company's Bylaws
concerning each person the stockholder proposes to nominate for election and the
nominating stockholder.

Meetings of the Board of Directors and its Committees

During the fiscal year ended June 30, 1997, there were six (6) meetings of
the full Board of Directors. All nominees attended at least 75% of the meetings
held during their terms as Directors. The Company's Board of Directors has an
Audit Committee, a Compensation Committee and a Stock Option Committee. Each
committee met at least once during the fiscal year ended June 30, 1997. All
committee members attended at least 75% of all committee meetings held during
their terms as members of such committees.

Audit Committee. The Audit Committee is currently composed of three (3)
non-employee Directors. The current members of the Audit Committee are Messrs.
Emery, Farmer and Word. This committee meets with the Company's independent
public accountants to review the scope and results of auditing procedures and
the Company's accounting procedures and controls. The Audit Committee also
provides general oversight with respect to the accounting principles

17
<PAGE>

employed in the Company's financial reporting. The Audit Committee met two (2)
times during the fiscal year ended June 30, 1997.

Compensation and Primary Stock Option Committee. The Compensation and
Primary Stock Option Committee (the "Compensation Committee") is composed of
three (3) non-employee Directors. The current members of the Compensation
Committee are Messrs. Emery, Farmer and Word. The Compensation Committee is
responsible for determining and reviewing the compensation of the officers of
the Company, including the Company's Chief Executive Officer. The Compensation
Committee determines and reviews executive bonus plan targets and allocations
and administers the terms and provisions of the Company's Restated 1994 Stock
Option Plan. The Compensation Committee also has sole and exclusive authority to
administer the Discretionary Option Grant and Stock Issuance Programs under the
1997 Stock Incentive Plan with respect to officers or directors of the Company
subject to the short swing profit liabilities of Section 16 of the Exchange Act.
The Compensation Committee met one (1) time during the fiscal year ended June
30, 1997.

Secondary Stock Option Committee. The Secondary Stock Option Committee is
currently composed of one (1) Director who is not eligible to receive stock
options under the Company's Outside Directors' Stock Option Plan (the "Outside
Directors' Stock Option Plan"). Currently, Mr. Budagher is the sole member of
the Secondary Stock Option Committee. The Compensation Committee also has
authority to administer the Discretionary Option Grant and Stock Issuance
Programs under the 1997 Stock Incentive Plan with respect to eligible persons
other than officers or directors of the Company subject to the short swing
profit liabilities of Section 16 of the Exchange Act. The Secondary Stock
Option Committee met four (4) times during the fiscal year ended June 30, 1997.

PROPOSAL 3

APPROVAL OF THE COMPANY'S 1997 STOCK INCENTIVE PLAN

EXISTING EQUITY INCENTIVE PLANS

The Company currently maintains the Restated 1994 Stock Option Plan and the
Outside Directors' Stock Option Plan. As of October 8, 1997, (i) 394,325
options had been issued under the Amended and Restated 1994 Stock Option Plan of
which 44,955 had been exercised and 349,370 remained outstanding, and (ii) 5,675
options remained available for future issuance under the Restated 1994 Stock
Option Plan. As of October 8, 1997, (i) 30,000 options had been issued under
the Outside Directors' Stock Option Plan, of which 10,000 had been exercised and
20,000 remained outstanding and currently exercisable, and (ii) 20,000 options
remained available for future issuance under the Outside Directors' Stock Option
Plan. As result of the MTS Merger, all options issued and outstanding under the
Restated 1994 Stock Option Plan on June 30, 1997 (394,325 options) vested and
became exercisable. However, such options continue to be subject to certain
restrictions on exercise set forth in the Restated 1994 Stock Option Plan and,
with respect to ________ options held by employees bound by employment
agreements with the Company or one of its subsidiaries, by certain additional
restrictions on exercise set forth in their employment agreement.

DESCRIPTION OF THE 1997 STOCK INCENTIVE PLAN

The following is a summary of the principal features of the 1997 Plan. The
summary does not, however, purport to be a complete description of all the
provisions of the 1997 Plan. Any stockholder of the Company who wishes to obtain
a copy of the actual plan document may do so upon written request to the
Secretary at the Company's principal executive offices in Cedar Crest, New
Mexico.

18
<PAGE>

STRUCTURE. The 1997 Stock Incentive Plan will contain three separate equity
incentive programs: (i) a Discretionary Option Grant Program, (ii) a Stock
Issuance Program, and (iii) an Automatic Option Grant Program. The principal
features of each program are described below.

ADMINISTRATION. The Compensation and Stock Options Committee of the Board
will serve as the initial Plan Administrator with respect to the Discretionary
Option Grant and Stock Issuance Programs. However, one or more additional Board
committees may be appointed to administer those programs with respect to certain
designated classes of individuals in the Company's service. The term "Plan
Administrator" as used in this summary will mean the Compensation Committee and
any other appointed committee acting within the scope of its administrative
authority under the 1997 Stock Incentive Plan. Administration of the Automatic
Option Grant Program will be self-executing in accordance with the express
provisions of such program.

SHARE RESERVE. The maximum number of shares reserved for issuance under the
1997 Stock Incentive Plan will be limited to 500,000 shares of the Company's
Common Stock. In no event may any one participant in the 1997 Stock Incentive
Plan be granted stock options, separately exercisable stock appreciation rights
and direct stock issuances for more than 200,000 shares in the aggregate per
calendar year.

Shares subject to any outstanding options under the 1997 Stock Incentive
Plan which expire or otherwise terminate prior to exercise will be available for
subsequent option grants and direct issuances. Unvested shares issued under the
1997 Stock Incentive Plan and subsequently repurchased by the Company, at the
exercise price or direct issue price paid per share, pursuant to its repurchase
rights under the 1997 Stock Incentive Plan will also be available for subsequent
issuance. However, shares subject to any option surrendered in accordance with
the stock appreciation right provisions of the 1997 Stock Incentive Plan will
not be available for subsequent issuance.

ELIGIBILITY. Officers and employees, nonemployee Board members and
independent consultants and advisors in the service of the Company or its parent
and subsidiaries (whether now existing or subsequently established) will be
eligible to participate in the Discretionary Option Grant and Stock Issuance
Programs. Only nonemployee members of the Board will be eligible to participate
in the Automatic Option Grant Program.

VALUATION. The fair market value per share of Common Stock on any relevant
date under the 1997 Stock Incentive Plan will be the closing sales price per
share on that date on the Nasdaq National Market.

DISCRETIONARY OPTION GRANT PROGRAM

GRANTS. The Plan Administrator has complete discretion under the
Discretionary Option Grant Program to determine which eligible individuals are
to receive option grants, the time or times when such grants are to be made, the
number of shares subject to each such grant, the status of any granted option as
either an incentive stock option or a nonstatutory option under the federal tax
laws, the vesting schedule (if any) to be in effect for the option grant and the
maximum term for which any granted option is to remain outstanding.

PRICE AND EXERCISABILITY. Each granted option will have an exercise price
per share not less than one hundred percent (100%) of the fair market value per
share of Common Stock on the option grant date, and no granted option will have
a term in excess of ten years. The option will generally become exercisable in a
series of installments over a specified period of service measured from the
grant date. The exercise price may be paid in cash or in shares of the Common
Stock.

No optionee will have any stockholder rights with respect to the option
shares until such optionee has exercised the option and paid the exercise price
for the purchased shares. Options are generally not assignable or transferable
other than by will or the laws of inheritance and, during the optionee's
lifetime, the option may be exercised only by such optionee. The Plan
Administrator may, however, allow nonstatutory options to be transferred or
assigned during the optionee's lifetime to one or more members of the optionee's
immediate family or to a trust established exclusively for

19
<PAGE>

one or more of such family members, to the extent such transfer or assignment is
in furtherance of the optionee's estate plan.

TERMINATION OF SERVICE. Upon the optionee's cessation of employment or
service, the optionee will have a limited period of time in which to exercise
his or her outstanding options for any shares which have vested at that time.
However, at any time while the options remain outstanding, the Plan
Administrator will have complete discretion to extend the period during which
those options may be exercised following the optionee's cessation of service.
The Plan Administrator will also have complete discretion to accelerate the
exercisability or vesting of those options in whole or in part at any time.

STOCK APPRECIATION RIGHTS. The Plan Administrator is authorized to issue
two types of stock appreciation rights in connection with option grants made
under the Discretionary Option Grant Program:

Tandem stock appreciation rights provide the holders with the right to
surrender their options for an appreciation distribution from the Company
equal in amount to the excess of (a) the fair market value of the vested
shares of Common Stock subject to the surrendered option less (b)the
aggregate exercise price payable for those shares. Such appreciation
distribution may, at the discretion of the Plan Administrator, be made in
cash or in shares of Common Stock.

Limited stock appreciation rights may be provided to one or more
officers of the Company as part of their option grants. Any option with
such a limited stock appreciation right may be surrendered to the Company
upon the successful completion of a hostile tender offer for more than
fifty percent (50%) of the Company's outstanding voting stock. In return
for the surrendered option, the officer will be entitled to a cash
distribution from the Company in an amount per surrendered option share
equal to the excess of (a) the highest price per share of Common Stock paid
in connection with the tender offer less (b) the exercise price payable for
such share.

CANCELLATION/REGRANT PROGRAM. The Plan Administrator will have the
authority to effect the cancellation of outstanding options under the
Discretionary Option Grant Program and to issue replacement options with an
exercise price equal to the fair market value per share of Common Stock at the
time of the new grant.

STOCK ISSUANCE PROGRAM

Shares of Common Stock may be issued under the Stock Issuance Program as a
bonus for services rendered to the Company or sold at a price per share not less
than one hundred percent (100%) of their fair market value, payable in cash or
through a promissory note payable to the Company. The shares issued as a bonus
for past services will be fully vested upon issuance. All other shares issued
under the program will be subject to a vesting schedule tied to the performance
of service or the attainment of performance goals. The Plan Administrator will,
however, have the discretionary authority at any time to accelerate the vesting
of any and all unvested shares outstanding under the 1997 Stock Incentive Plan.

AUTOMATIC OPTION GRANT PROGRAM

Under the Automatic Option Grant Program, nonemployee Board members will
receive option grants at specified intervals over their period of Board service.
All grants under the Automatic Option Grant Program will be made in strict
compliance with the express provisions of such program, and stockholder approval
of this Proposal will also constitute preapproval of each option granted
pursuant to the provisions of the Automatic Option Grant Program summarized
below and the subsequent exercise of that option in accordance with such
provisions.

GRANTS. Each individual who first becomes a nonemployee Board member on or
after the Effective Date, whether through election by the stockholders or
appointment by the Board, will automatically be granted, at the time of such
initial election or appointment, a nonstatutory option to purchase 6,000 shares
of Common Stock, provided such individual has not previously been in the
Company's employ.

20
<PAGE>

On the date of each Annual Meeting, beginning with the 1998 Annual Meeting,
each individual who is to continue to serve as a nonemployee Board member,
whether or not such individual is standing for re-election at that particular
Annual Meeting, will automatically be granted a nonstatutory option to purchase
3,000 shares of Common Stock, provided such individual has served as a
nonemployee Board member for at least six months. There will be no limit on the
number of such 3,000 share option grants any one nonemployee Board member may
receive over his or her period of Board service, and nonemployee Board members
who have previously been employed by the Company will be eligible to receive one
or more of those annual grants.

EXERCISE/VESTING. Each automatic option grant will have an exercise price
per share equal to 100% of the fair market value per share of Common Stock on
the grant date and a maximum term of ten years measured from such date. Each
initial 6,000 share option grant shall be immediately exercisable for any or all
of the option shares and will remain so exercisable until the expiration or
sooner termination of the option term; provided, however, that 3,000 of such
option shares will be subject to repurchase by the Corporation, at the exercise
price paid per share, upon the Optionee's cessation of Board service prior to
vesting in those shares. The unvested portion of the initial 6,000 share grant
shall vest, and the Corporation's repurchase right shall lapse, in two (2)
successive equal annual installments (the first of which shall be for 2,000 of
the 3,000 unvested shares and the second of which shall be for the remaining
1,000 of the 3,000 unvested shares), upon the Optionee's completion of each year
of Board service over the two (2) year period measured from the date of the
initial grant. Each annual 3,000 share grant shall also be immediately
exercisable for any or all of the option shares, provided, however, that 2,000
of the shares of Common Stock purchased under each annual 3,000 share grant
shall be subject to repurchase by the Corporation, at the exercise price paid
per share, upon the Optionee's cessation of Board service prior to vesting in
those shares. The unvested portion of each annual 3,000 share grant shall vest,
and the Corporation's repurchase right shall lapse, in a series of two (2)
successive equal annual installments upon the Optionee's completion of each year
of Board service over the two (2) year period measured from the automatic grant
date.

Each automatic option will remain exercisable for a twelve month period
following the optionee's cessation of service as a Board member. In no event,
however, may the option be exercised after the expiration date of the option
term. During the applicable post-service exercise period, the option may not be
exercised for more than the number of option shares (if any) in which the Board
member is vested at the time of his or her cessation of Board service.

SPECIAL VESTING. The shares subject to each automatic option grant will
immediately vest upon (i) the optionee's death or permanent disability while a
Board member, (ii) an acquisition of the Company by merger or asset sale, (iii)
the successful completion of a tender offer for more than 50% of the Company's
outstanding voting stock, or (iv) a change in the majority of the Board effected
through one or more contested elections for Board membership.

STOCK APPRECIATION RIGHTS. Upon the successful completion of a hostile
tender offer for more than 50% of the Company's outstanding voting stock, each
outstanding automatic option grant may be surrendered to the Company for a cash
distribution per surrendered option share in an amount equal to the excess of
(a) the highest price per share of Common Stock paid in connection with such
tender offer less (b) the exercise price payable for such share. Stockholder
approval of this Proposal will constitute preapproval of each option granted
with such a surrender right and the subsequent surrender of that option in
accordance with the foregoing provisions. No additional approval of the 1997
Stock Incentive Plan Administrator or the Board will be required at the time of
the actual option surrender and cash distribution.

The remaining terms and conditions of each automatic option grant will, in
general, conform to the terms summarized above for option grants made under the
Discretionary Option Grant Program and will be incorporated into the option
agreement evidencing the automatic grant.

GENERAL PROVISIONS

ACCELERATION. In the event that the Company is acquired by merger or asset
sale, each outstanding option under the Discretionary Option Grant Program which
is not to be assumed by the successor corporation will automatically accelerate
in full, and all unvested shares under the Discretionary Option Grant and Stock
Issuance

21
<PAGE>

Programs will immediately vest, except to the extent the Company's repurchase
rights with respect to those shares are to be assigned to the successor
corporation. The Plan Administrator will have complete discretion to grant one
or more options under the Discretionary Option Grant Program which will become
fully exercisable for all the option shares in the event those options are
assumed in the acquisition and the optionee's service with the Company or the
acquiring entity terminates within a designated period following such
acquisition. The Plan Administrator also has the authority to grant options
which will immediately vest upon an acquisition of the Company, whether or not
those options are assumed by the successor corporation. The vesting of
outstanding shares under the Stock Issuance Program may be accelerated upon
similar terms and conditions.

The Plan Administrator is also authorized to provide for the full and
immediate vesting of all outstanding options and unvested shares under the
Discretionary Option Grant and Stock Issuance Programs in connection with a
change in control of the Company (whether by successful tender offer for more
than fifty percent (50%) of the outstanding voting stock or a change in the
majority of the Board by reason of one or more contested elections for Board
membership), with such vesting to occur either at the time of such change in
control or upon the subsequent termination of the individual's service within a
designated period following such change in control.

The acceleration of vesting in the event of a change in the ownership or
control of the Company may be seen as an anti-takeover provision and may have
the effect of discouraging a merger proposal, a takeover attempt or other
efforts to gain control of the Company.

FINANCIAL ASSISTANCE. The Plan Administrator may institute a loan program
to assist one or more participants in financing the exercise of outstanding
options or the purchase of shares under the 1997 Stock Incentive Plan. The terms
of any such assistance will be established in the sole discretion of the Plan
Administrator. However, all loans made under the 1997 Stock Incentive Plan will
be full-recourse and interest bearing, and the maximum credit available may not
exceed the purchase price payable for the acquired shares plus any withholding
tax liability incurred in connection with such acquisition.

CHANGES IN CAPITALIZATION. In the event any change is made to the
outstanding shares of Common Stock by reason of any recapitalization, stock
dividend, stock split, combination of shares, exchange of shares or other change
in corporate structure effected without the Company's receipt of consideration,
appropriate adjustments will automatically be made to (i) the maximum number
and/or class of securities issuable under the Plan, (ii) the number and/or class
of securities for which any one person may be granted stock options, separately
exercisable stock appreciation rights and direct stock issuances per calendar
year, (iii) the number and/or class of securities for which grants are
subsequently to be made under the Automatic Option Grant Program to new and
continuing Board members and (iv) the number and/or class of securities and the
exercise price per share in effect under each outstanding option. The
adjustments to such outstanding options will preclude the dilution or
enlargement of the rights and benefits available under those options.

SPECIAL TAX ELECTION. The Plan Administrator may provide one or more
holders of options or unvested shares with the right to have the Company
withhold a portion of the shares otherwise issuable to such individuals in
satisfaction of the tax liability incurred by such individuals in connection
with the exercise of those options or the vesting of those shares.
Alternatively, the Plan Administrator may allow such individuals to deliver
previously acquired shares of Common Stock in payment of such tax liability.

AMENDMENT AND TERMINATION. The Board may amend or modify the 1997 Stock
Incentive Plan in any or all respects whatsoever subject to any required
stockholder approval. The Board may terminate the 1997 Stock Incentive Plan at
any time, and the 1997 Stock Incentive Plan will in all events terminate upon
the expiration of the ten (10) year term measured from the Effective Date.

22
<PAGE>

FEDERAL INCOME TAX CONSEQUENCES

OPTION GRANTS. Options granted under the 1997 Stock Incentive Plan may be
either incentive stock options which satisfy the requirements of Section 422 of
the Internal Revenue Code (the "Code") or nonstatutory options which are not
intended to meet such requirements. The federal income tax treatment for the two
types of options differs as follows:

Incentive Options. No taxable income is recognized by the optionee at
the time of the option grant, and no taxable income is generally recognized at
the time the option is exercised. The optionee will, however, recognize taxable
income in the year in which the purchased shares are sold or otherwise made the
subject of a taxable disposition. For federal tax purposes, dispositions are
divided into two categories: (i) qualifying and (ii) disqualifying. A qualifying
disposition occurs if the sale or other disposition is made after the optionee
has held the shares for more than two years after the option grant date and more
than one year after the exercise date. If either of these two holding periods is
not satisfied,then a disqualifying disposition will result. If the optionee
makes a disqualifying disposition of the purchased shares, then the Company will
be entitled to an income tax deduction, for the taxable year in which such
disposition occurs, equal to the excess of (i) the fair market value of such
shares on the option exercise date over (ii) the exercise price paid for the
shares. In no other instance will the Company be allowed a deduction with
respect to the optionee's disposition of the purchased shares.

Nonstatutory Options. No taxable income is recognized by an optionee upon
the grant of a nonstatutory option. The optionee will in general recognize
ordinary income in the year in which the option is exercised equal to the excess
of the fair market value of the purchased shares on the exercise date over the
exercise price paid for the shares, and the optionee will be required to satisfy
the tax withholding requirements applicable to such income. If the shares
acquired upon exercise of the nonstatutory option are unvested and subject to
repurchase by the Company in the event the optionee's termination of service
prior to vesting in those shares, then the optionee will not recognize any
taxable income at the time of exercise but will have to report as ordinary
income, as and when the Company's repurchase right lapses, an amount equal to
the excess of (i) the fair market value of the shares on the date the repurchase
right lapses over (ii) the exercise price paid for the shares. The optionee may,
however, elect under Section 83(b) of the Internal Revenue Code to include as
ordinary income in the year of exercise of the option an amount equal to the
excess of (i) the fair market value of the purchased shares on the exercise date
over (ii) the exercise price paid for such shares. If the Section 83(b) election
is made, the optionee will not recognize any additional income as and when the
repurchase right lapses. The Company will be entitled to an income tax deduction
equal to the amount of ordinary income recognized by the optionee with respect
to the exercised nonstatutory option. The deduction will generally be allowed
for the taxable year of the Company in which such ordinary income is recognized
by the optionee.

STOCK APPRECIATION RIGHTS. An optionee who is granted a stock appreciation
right will recognize ordinary income in the year of exercise equal to the amount
of the appreciation distribution. The Company will be entitled to an income tax
deduction equal to such distribution for the taxable year in which the ordinary
income is recognized by the optionee.

DIRECT STOCK ISSUANCES. The tax principles applicable to direct stock
issuances under the 1997 Stock Incentive Plan will be substantially the same as
those summarized above for the exercise of nonstatutory option grants.

DEDUCTIBILITY OF EXECUTIVE COMPENSATION. The Company anticipates that any
compensation deemed paid by it in connection with disqualifying dispositions of
incentive stock option shares or exercises of nonstatutory options will qualify
as performance based compensation for purposes of Code Section 162(m) of the
Internal Revenue Code and will not have to be taken into account for purposes of
the $1 million limitation per covered individual on the deductibility of the
compensation paid to certain executive officers of the Company. Accordingly, all
compensation deemed paid with respect to those options will remain deductible by
the Company without limitation under Code Section 162(m).

ACCOUNTING TREATMENT

23
<PAGE>

Option grants or stock issuances with exercise or issue prices at 100% of
fair market value will not result in any direct charge to the Company's
earnings. However, the fair value of those options is required to be disclosed
in the notes to the Company's financial statements, and the Company must also
disclose, in pro forma statements to the Company's financial statements, the
impact those options would have upon the Company's reported earnings were the
value of those options at the time of grant treated as compensation expense. In
addition, the number of outstanding options may be a factor in determining the
Company's earnings per share on a fully diluted basis.

STOCKHOLDER APPROVAL

The affirmative vote of a majority of the outstanding voting shares of the
Company present or represented by proxies and entitled to vote at the 1997
Annual Meeting is required for approval of the 1997 Stock Incentive Plan. If
such approval is obtained, the 1997 Stock Incentive Plan will become effective
on the date of the 1997 Annual Meeting. In the absence of such approval, the
1997 Stock Incentive Plan will not be implemented.

RECOMMENDATION OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE
APPROVAL OF THE 1997 STOCK INCENTIVE PLAN.

PROPOSAL 4

RATIFICATION OF PREVIOUSLY GRANTED STOCK OPTIONS

In connection with the acquisition by Specialty Constructors, Inc., a
wholly-owned subsidiary of the Company ("Specialty Constructors") of
substantially all the assets of Paramount Communication Systems, Inc.
("Paramount"), on May 28, 1997, certain former employees of Paramount became
employees of Specialty Constructors. In connection with their employment and
execution of new employment agreements with Specialty Constructors, the
Secondary Stock Option Committee authorized grants to the following employees of
the number of options set forth opposite such person's name:
<TABLE>
<CAPTION>

<S> <C>
Joseph McCaul 500
Patrick McNally 500
Philip Musso 750
Michele Vaughn 500
Pasquale Rutigliano 500
Scott Milloy 500
Darrin Schaurer 750
Alan Barnes 750
</TABLE>

These options were granted at an exercise price of $11.125 per share,
determined by the Secondary Stock Option Committee to equal the fair market
value of the Company's Common Stock on the date of the option grant, and are
subject to a three-year vesting schedule. These options are intended to qualify
as incentive stock options under the requirements of Section 422 of the Internal
Revenue Code of 1986, as amended, and were granted pursuant to the 1997 Stock
Incentive Plan subject to stockholder approval of the 1997 Stock Incentive Plan.
To date, all of these options remain unexercised.

24
<PAGE>

In connection with the MTS Merger, on June 30, 1997, the Secondary Stock
Option Committee authorized grants to the following employees of MTS of the
number of options set forth opposite such person's name:
<TABLE>
<CAPTION>

<S> <C>
Michael D. Brunick 100,000
Maralyn S. Davis 13,000
Michael J. Kitzmiller 13,000
Michael S. Nelson 13,000
Bob T. Paswalk 20,000
Kevin R. Paswalk 13,000
John J. Williamson 20,000
Darin L. Zundel 13,000
Matt Carpenter 13,000
</TABLE>

These options were granted at an exercise price of $14.75 per share,
determined by the Secondary Stock Option Committee to equal the fair market
value of the Company's Common Stock on the date of the option grant, and are
subject to a three-year vesting schedule. With the exception of 80,000 of the
options granted to Michael Brunick, all of these options are intended to qualify
as incentive stock options under the requirements of Section 422 of the Internal
Revenue Code of 1986, as amended. All of these options granted pursuant to the
1997 Stock Incentive Plan subject to stockholder approval of the 1997 Stock
Incentive Plan. To date, all of these options remain unexercised.

In connection with the acquisition by Specialty Constructors of
substantially all the assets of Ellis Tower Co., Inc. ("Ellis"), as of September
30, 1997, certain former employees of Ellis became employees of Specialty
Constructors. In connection with his employment and execution of a new
employment agreement with Specialty Constructors, the Secondary Stock Option
Committee authorized a grant to of 15,000 options to Craig Lekutis.

These options were granted at an exercise price of $15.50 per share,
determined by the Board of Directors to equal the fair market value of the
Company's Common Stock on the date of the option grant, and are subject to a
three-year vesting schedule. These options are intended to qualify as incentive
stock options under the requirements of Section 422 of the Internal Revenue Code
of 1986, as amended, and were granted pursuant to the 1997 Stock Incentive Plan
subject to stockholder approval of the 1997 Stock Incentive Plan. To date, all
of these options remain unexercised.

STOCKHOLDER APPROVAL

The affirmative vote of a majority of the outstanding voting shares of the
Company present or represented by proxies and entitled to vote at the Annual
Meeting is required for ratification of the previously granted stock options in
order that the grant transactions comply with the provisions of Rule 16b-3 of
the Exchange Act, to preserve their status as exempt under Section 16(b) of the
1934 Act. The Company's stockholders are being asked to ratify these stock
option grants in order to motivate these employees to promote the Company's
business otherwise use their best efforts in the service of the Company and the
enhancement of stockholder value.

RECOMMENDATION OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE
APPROVAL OF THIS PROPOSAL.

PROPOSAL 5

RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS

The accounting firm of KPMG Peat Marwick LLP served as the Company's
independent auditors for the fiscal year ended June 30, 1997. The Board of
Directors has selected that firm to continue in this capacity for the current
fiscal year. The Company is asking the stockholders to ratify the selection by
the Board of Directors of KPMG Peat Marwick

25
<PAGE>

LLP as the Company's independent auditors to audit the financial statements of
the Company for the fiscal year ending June 30, 1998 and to perform other
appropriate services. Stockholder ratification of the selection of KPMG Peat
Marwick LLP as the Company's independent auditor is not required by the
Company's Bylaws or otherwise. In the event that the stockholders fail to ratify
the appointment, the Board of Directors will reconsider its selection. Even if
the selection is ratified, the Board of Directors, in its discretion, may direct
the appointment of a different independent accounting firm at any time during
the year if the Board of Directors feels that such a change would be in the best
interest of the Company and its stockholders.

A representative of KPMG Peat Marwick LLP is expected to be present at the
Annual Meeting to respond to stockholders' questions, and that representative
will be given an opportunity to make a brief presentation to the stockholders if
he or she so desires.

STOCKHOLDER APPROVAL

The affirmative vote of a majority of the outstanding shares of the Company
present or represented and entitled to vote at the Annual Meeting will be
required for ratification of the selection of KPMG Peat Marwick LLP as the
Company's independent auditors for the fiscal year ending June 30, 1998.

RECOMMENDATION OF THE BOARD OF DIRECTORS

THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE
RATIFICATION AND APPROVAL OF THE SELECTION OF KPMG PEAT MARWICK LLP AS THE
COMPANY'S INDEPENDENT AUDITORS FOR THE FISCAL YEAR ENDING JUNE 30, 1998.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Set forth below is a description concerning transactions which may not
otherwise be described herein by and between the Company and/or its affiliates
and other persons or entities affiliated with the Company or its affiliates. The

Company is of the view that each of such transactions was on terms no less
favorable to the Company than would otherwise have been available to the Company
in transactions with unaffiliated third parties, if available at all.

Michael R. Budagher owns 52% of Specialty Antenna Site Resources, Inc.
("SASR"). In 1990, SASR acquired approximately 200 microwave towers and related
land from Western Union for future sale. SASR has sold approximately 95% of
these towers. The Company did not transact any business with SASR during fiscal
1996 or 1997. However, in fiscal 1995, the Company received $1,200 for services
provided to SASR by the Company. The relationship with SASR is expected to be
negligible in the future.

Until March 1, 1997, Michael R. Budagher owned 50% of Specialty
Constructors Coatings, Inc. ("SCC"). SCC provides lead abatement services and
finishes or refinishes metal structures, principally elevated water towers.
During the years ended June 30, 1995, 1996 and 1997, the Company had paid
$170,260, $401,587 and $606,304, respectively, for services provided by SCC to
the Company. On March 1, 1997, Mr. Budagher sold his interest in SCC to two
employees of SCC pursuant to a warrant to purchase said interests that was sold
to these employees in 1996. On June, 1, 1997, the Company acquired
substantially all the assets of SCC in exchange for 55,814 shares of Common
Stock.

Until August, 1997, Bruce P. Budagher, vice president of Specialty
Constructors and the brother of Michael R. Budagher, and Sheril E. Budagher, the
spouse of Michael R. Budagher, owned all of the outstanding stock of Specialty
Manufacturing, Inc. ("SMI"). SMI manufactures devices ("SMI ground kits") that
ground electric transmission lines used in connection with wireless transmitting
and receiving facilities. Historically, the Company has bought SMI ground kits
for use in connection with certain of the Company's wireless infrastructure
building operations. During fiscal 1995, 1996 and 1997, the Company purchased
$12,065, $13,285 and $29,852, respectively, of SMI ground kits. In August,
1997, Microwave Tower Service, Inc., a wholly-owned subsidiary of the Company,
acquired substantially all the inventory and manufacturing equipment of SMI and
the right to manufacture and sell SMI ground kits in exchange for

26
<PAGE>

approximately $134,832 in cash and the right to receive a royalty of $2.00 per
SMI ground kit sold by Microwave Tower Service, Inc. during the period beginning
August 1, 1997 and ending July 31, 2000.

The Company has utilized contract labor from Budagher's Nursery, Inc., a
company wholly owned by William J. Budagher, a brother of Michael R. Budagher
and Bruce P. Budagher. The Company paid $126,884, $92,391 and $452,338 for
contract labor services provided by Budagher's Nursery, Inc. for the years ended
June 30, 1995, 1996 and 1997, respectively.

The Company presently leases approximately 5,400 square feet of office
space from Michael R. Budagher, its Chairman of the Board, President, Chief
Executive Officer, Treasurer and a Director, for $16,800 annually. The office
space is located in a 6,400 square foot building in Cedar Crest, New Mexico.
This office serves as the Company's headquarters and as a regional office for
the Company's wireless infrastructure building and implementation and wireless
infrastructure electrical design and engineering operations. Management of the
Company believes that the rent for the space is at least as favorable as could
have been negotiated in an arms length transaction.

During the fiscal year ended June 30, 1997, the Company purchased $325,000
of components from Wireless Components, Inc., an entity owned by Tommie R.
Carpenter, the former sole stockholder of Microwave Tower Service, Inc. As of
October 8, 1997, Tommie R. Carpenter beneficially owned 2,380,000 shares of
Common Stock or 29.7% of the shares outstanding on such date.

In connection with the MTS Merger, on June 30, 1997, the Company borrowed
$2,000,000 (the "Carpenter Loan") from Tommie R. Carpenter, the former sole
stockholder of Microwave Tower Service, Inc. The Carpenter Loan bears interest
at 8.25% and is the principal amount due in installments of $406,000 on
September 1, 1997, $270,000 on December 1, 1997, $325,000 on January 1, 1998 and
$999,000 on April 1, 1998.

There are numerous conflicts of interest between the Company and its
affiliates, particularly between the Company and entities that are affiliated
with individuals having executive responsibility for the Company. Typically,
these include the possibility of channeling business to entities other than the
Company that is more appropriately business of the Company, the Company paying
excessive prices to affiliated entities, or the Company subsidizing the
affiliated entity by charging less than market rates. The Company has extensive
experience in costing the services it provides, and management of the Company
believes that the Company's costing to affiliated entities is consistent with
its general costing. Similarly, products or services received by the Company
from affiliated entities have been at substantially the same rates charged other
enterprises. The Company has compared these rates prior to engagement with
independent quotes or with rates charged by other entities. None of the
agreements or arrangements with affiliates are subject to adjustment.

While there has been no independent determination as to the fairness of the
Company's transactions with affiliated entities, the Company's Board of
Directors has reviewed these transactions and has found the terms of these
transactions to be fair and reasonable to the Company. Management of the Company
believes that the transactions with affiliated entities that occurred in the
past have been fair and reasonable to the Company and that practical measures
have been taken to assure that any such transactions in the future will be fair
and reasonable to the Company. Nonetheless, almost all transactions between the
Company and affiliated entities have been with entities that are controlled by
Michael R. Budagher. Michael R. Budagher has no intent to have any transaction
with an affiliated entity that is not fair and reasonable to the Company, now or
in the future.

During the fiscal year ended June 30, 1997, the Company engaged in
transactions with the law firm with which Mr. Farmer is associated. During the
fiscal year ended June 30, 1997, the Company paid $25,085.17 to the law firm of
Moses, Dunn, Farmer and Tuthill, P.C. Mr. Farmer is a stockholder, officer and
director of that firm and a Director of the Company.

27
<PAGE>

OTHER MATTERS

Stockholder Proposals and Nominations for Directors for the Company's Next
Annual Meeting

Any stockholder who intends to present a proposal for consideration at the
Company's next annual meeting of stockholders intended to occur on or about
November 15, 1998 must, on or before September 16, 1998, submit his proposal to
the Company in order to have the Company consider the inclusion of such proposal
in the Company's Proxy Statement and form of proxy relating to such annual
meeting. Reference is made to Rule 14a-8 under the Exchange Act for information
concerning the content and form of such proposal and the manner in which such
proposal must be made.

Nominations for election to the Board of Directors at the Company's next
annual meeting may be made only in writing by a stockholder entitled to vote at
such annual meeting and must be addressed to the Secretary, Specialty
Teleconstructors, Inc., 12001 Hwy. 14 North, Cedar Crest, New Mexico 87008.
Nominations must be received by the Secretary on or before September 16, 1998,
and must be accompanied by the written consent of the nominee. Nominations
should also be accompanied by a description of the nominee's business or
professional background and otherwise contain the information required by
Schedule 14A of the Exchange Act.

Other Business

The Board of Directors is not aware of any other matters that may be
brought before the Annual Meeting. If other matters not now known come before
the Annual Meeting, the persons named in the accompanying form of proxy or their
substitutes will vote such proxy in accordance with their judgment.

Independent Public Accountants

Representatives of KPMG Peat Marwick LLP are expected to be present at the
Annual Meeting, will have the opportunity to make a statement if they desire to
do so, and are expected to be available to respond to appropriate questions.

Annual Report on Form 10-KSB

A copy of the Company's Annual Report on Form 10-KSB which contains copies
of the Company's audited financial statements is being sent to stockholders with
this Proxy Statement.

IN ADDITION, THE COMPANY WILL FURNISH WITHOUT CHARGE TO ANY STOCKHOLDER,
UPON THE WRITTEN OR ORAL REQUEST OF SUCH PERSON, A COPY OF THE COMPANY'S ANNUAL
REPORT ON FORM 10-KSB. REQUESTS FOR THIS REPORT SHOULD BE ADDRESSED TO DENNIS K.
HARTNETT, CORPORATE SECRETARY OF SPECIALTY TELECONSTRUCTORS INC., 12001 HWY. 14
NORTH, CEDAR CREST, NEW MEXICO 87008, TELEPHONE NUMBER (505) 281-2197.

28
<PAGE>

EXHIBIT A

PROPOSED AMENDMENTS TO RESTATED
ARTICLES OF INCORPORATION

PROPOSAL 1(a):

"ARTICLE FOUR

DIRECTORS

Section 4.01 Governing Board. The members of the governing board of the
---------------
corporation shall be styled directors.

Section 4.02 Number. The Corporation shall have at least one director, the
------
actual number to be determined as set forth in the Bylaws.

Section 4.03 Staggered Terms. The Board of Directors shall be divided into
---------------
three classes if the number of directors is four or more, with said classes to
be as equal in number as may be possible. Any director or directors in excess
of the number divisible by three shall be first assigned to Class 1, and any
additional director shall be assigned to Class 2, as the case may be. (For
example, if there are five directors, the fourth director shall be in Class 1
and the fifth director in Class 2.) At the first election of directors to such
classified Board of Directors, each Class 1 Director shall be elected to serve
until the next ensuing annual meeting of stockholders, each Class 2 Director
shall be elected to serve until the second annual meeting of stockholders and
each Class 3 Director, shall be elected to serve until the third ensuing annual
meeting of stockholders. At each annual meeting of stockholders following the
meeting at which the Board of Directors is initially classified, the number of
directors equal to the number of directors in a class whose term expires at the
time of such meeting shall be elected to serve until the third ensuing annual
meeting of stockholders. Notwithstanding any of the foregoing provisions of this
Article Four, directors shall serve until their successors are elected and
qualified or until their earlier death, resignation or removal from office, or
until there is a decrease in the number of directors; provided, however, that no
decrease in the number of directors shall have the effect of shortening the term
of any incumbent director."

PROPOSAL 1(b):

If Proposal 1(c) also is approved:

"ARTICLE THREE
SHARES OF STOCK

Section 3.01 Number and Classes. The total number of shares of capital
------------------
stock which this Corporation is authorized to issue is TWENTY-TWO MILLION
(22,000,000), consisting of TWENTY MILLION (20,0000,000) shares of Common Stock,
par value one cent ($0.01) per share, and TWO MILLION (2,000,000) shares of
Preferred Stock. The Common Stock may be issued from time to time without
action by the stockholders. The Common Stock is subject to the rights and
preferences of the Preferred Stock as hereinafter set forth. Subject to the
rights and preferences of the Preferred Stock, (i) the Common Stock may be
issued for such consideration as may be fixed from time to time by the Board of
Directors, and (ii) the Board of Directors may issue such shares of Common Stock
in one or more series, with such voting powers, designations, preferences,
rights, qualifications, limitations or restrictions thereof as shall be stated
in the resolution or resolutions providing for the issuance thereof.

A-1
<PAGE>

hereof, the voting powers, designations, preferences, rights, qualifications,
limitations or restrictions of the shares of any series that is wholly unissued
or is to be established. Unless otherwise specifically provided in the
resolution establishing any series, the Board of Directors shall further have
the authority, after the issuance of shares of a series whose number it has
designated, to amend the resolution establishing such series to decrease the
number of shares of that series, but not below the number of shares of such
series then outstanding. In the event that there are no issued or outstanding
shares of a series of Preferred Stock which this Corporation has been authorized
to issue, unless otherwise specifically provided in the resolution establishing
such series, the Board of Directors, without any further action on the part of
the holders of the outstanding shares of any class or series of stock of this
corporation, may amend these Restated Articles of Incorporation to delete all
reference to such series.

Section 3.03 Dividends. The holders of shares of Preferred Stock shall be
---------
entitled to receive dividends, out of the funds of this Corporation legally
available therefor, at the rate and at the time or times, whether cumulative or
noncumulative, as may be provided by the Board of Directors in designating a
particular series of Preferred Stock. If such dividends on the Preferred Stock
shall be cumulative, then if dividends shall not have been paid, the deficiency
shall be fully paid or the dividends declared and set apart for payment at such
rate, but without interest on cumulative dividends, before any dividends on the
Common Stock shall be paid or declared and set apart for payment. The holders
of Preferred Stock shall not be entitled to receive any dividends thereon other
than the dividends referred to in this section.

Section 3.04 Redemption. The Preferred Stock may be redeemable at such
----------
price, in such amount, and at such time or times as may be provided by the Board
of Directors in designating a particular series of Preferred Stock. In any
event, such Preferred Stock may be repurchased by this Corporation to the extent
legally permissible.

Section 3.05 Liquidation. In the event of any liquidation, dissolution or
-----------
winding up of the affairs of this Corporation, whether voluntary or involuntary,
then, before any distribution shall be made to the holders of Common Stock, the
holders of Preferred Stock at the time outstanding shall be entitled to be paid
the preferential amount or amounts per share as may be provided by the Board of
Directors in designating a particular series of Preferred Stock and dividends
accrued thereon to the date of such payment. The holders of Preferred Stock
shall not be entitled to receive any distributive amount upon the liquidation,
dissolution or winding up of the affairs of this Corporation other than the
distributive amounts referred to in this section, unless otherwise provided by
the Board of Directors in designating a particular series of Preferred Stock.

Section 3.06 Conversion. Shares of Preferred Stock may be convertible
----------
into Common Stock of this Corporation upon such terms and conditions, at such
rate and subject to such adjustments as may be provided by the Board of
Directors in designating a particular series of Preferred Stock.

Section 3.07 Voting Rights. Holders of Preferred Stock shall have such
-------------
voting rights as may be provided by the Board of Directors in designating a
particular series of Preferred Stock."

If Proposal 1(c) is not approved:

"ARTICLE THREE
SHARES OF STOCK

Section 3.01 Number and Classes. The total number of shares of capital
------------------
stock which this Corporation is authorized to issue is TWELVE MILLION
(12,000,000), consisting of TEN MILLION (10,0000,000) shares of Common Stock,
par value one cent ($0.01) per share, and TWO MILLION (2,000,000) shares of
Preferred Stock. The Common Stock may be issued from time to time without
action by the stockholders. The Common Stock is subject to the rights and
preferences of the Preferred Stock as hereinafter set forth. Subject to the
rights and preferences of the Preferred Stock, (i) the Common Stock may be
issued for such consideration as may be fixed from time to time by the Board of
Directors, and (ii) the Board of Directors may issue such shares of Common Stock
in one or more series, with such voting powers, designations, preferences,
rights, qualifications, limitations or restrictions thereof as shall be stated
in the resolution or resolutions providing for the issuance thereof.

A-2
<PAGE>

Section 3.02 Issuance of Preferred Stock in Series. The Preferred Stock
-------------------------------------
may be issued from time to time in one or more series in any manner permitted by
law and the provisions of these Restated Articles of Incorporation, as
determined from time to time by the Board of Directors and stated in the
resolution or resolutions providing for the issuance thereof. The Board of
Directors shall have the authority to fix, determine and amend, subject to the
provisions hereof, the voting powers, designations, preferences, rights,
qualifications, limitations or restrictions of the shares of any series that is
wholly unissued or is to be established. Unless otherwise specifically provided
in the resolution establishing any series, the Board of Directors shall further
have the authority, after the issuance of shares of a series whose number it has
designated, to amend the resolution establishing such series to decrease the
number of shares of that series, but not below the number of shares of such
series then outstanding. In the event that there are no issued or outstanding
shares of a series of Preferred Stock which this Corporation has been authorized
to issue, unless otherwise specifically provided in the resolution establishing
such series, the Board of Directors, without any further action on the part of
the holders of the outstanding shares of any class or series of stock of this
corporation, may amend these Restated Articles of Incorporation to delete all
reference to such series.

Section 3.07 Voting Rights. Holders of Preferred Stock shall have such
-------------
voting rights as may be provided by the Board of Directors in designating a
particular series of Preferred Stock."

A-3
<PAGE>

PROPOSAL 1(c):

If Proposal 1(b) also is approved:

"ARTICLE THREE
SHARES OF STOCK

A-4
<PAGE>

Section 3.07 Voting Rights. Holders of Preferred Stock shall have such
-------------
voting rights as may be provided by the Board of Directors in designating a
particular series of Preferred Stock."

If Proposal 1(b) is not approved:

"ARTICLE THREE
SHARES OF STOCK

Section 3.01 Number and Class. The total number of shares of capital
----------------
stock which this Corporation is authorized to issue is TWENTY MILLION
(20,000,000), consisting of shares of Common Stock, par value one cent ($0.01)
per share. The Common Stock may be issued from time to time without action by
the stockholders. The Common Stock may be issued for such consideration as may
be fixed from time to time by the Board of Directors, and the Board of Directors
may issue such shares of Common Stock in one or more series, with such voting
powers, designations, preferences, rights, qualifications, limitations or
restrictions thereof as shall be stated in the resolution or resolutions
providing for the issuance thereof."

PROPOSAL 1(d)

If Proposal 1(b) also is approved:

"ARTICLE EIGHT
BYLAWS

The Board of Directors shall have the power to adopt, amend or repeal the
Bylaws of this Corporation subject to approval by a majority of the Continuing
Directors (as defined in Article XII hereof); provided, however, that the Board
of Directors may not repeal or amend any bylaw that the stockholders expressly
have provided may not be amended or repealed by the Board of Directors. The
stockholders shall also have the power to adopt, amend or repeal the Bylaws of
this Corporation by the affirmative vote of the holders of not less than two-
thirds of the outstanding shares entitled to vote thereon and, to the extent, if
any, provided by resolution adopted by the Board of Directors authorizing the
issuance of a class or series of Preferred Stock, by the affirmative vote of the
holders of not less than two-thirds of the outstanding shares of Common Stock
and/or such class or series of Preferred Stock, voting as separate voting
groups."

"ARTICLE NINE
AMENDMENTS TO RESTATED ARTICLES OF INCORPORATION

This Corporation reserves, and the rights of the stockholders of this
Corporation are granted subject to, the right to amend or repeal any of the
provisions contained in these Restated Articles of Incorporation as follows:

Section 9.01 Supermajority Voting. Except as provided in Section 9.02 of
--------------------
this Article Nine, the Restated Articles of Incorporation may be amended or
repealed only upon the affirmative vote of the holders of at least two-thirds of
the outstanding shares entitled to vote thereon and, to the extent, if any,
provided by resolution adopted by the Board of Directors authorizing the
issuance of a class or series of Preferred Stock, by the affirmative vote of the
holders of at least two-thirds of the outstanding shares of Common Stock and/or
of such class or series of Preferred Stock, voting as separate voting groups.

A-5
<PAGE>

require the affirmative vote of the holders of at least a majority of the
outstanding shares entitled to vote thereon and, to the extent, if any, provided
by resolution adopted by the Board of Directors authorizing the issuance of a
class or series of Preferred Stock, by the affirmative vote of the holders of at
least a majority of the Common Stock and/or of such class or series of Preferred
Stock, voting as separate voting groups. For the purpose of this Article Nine,
"Continuing Director" means any member of the Board of Directors (i) who was a
member of the Board of Directors on November 21, 1997, or (ii) who is elected to
the Board of Directors after November 21, 1997, after being nominated by a
majority of the Continuing Directors voting separately and as a subclass of
directors on such nomination."

If Proposal 1(b) is not approved:

"ARTICLE EIGHT
BYLAWS

"ARTICLE NINE
AMENDMENTS TO RESTATED ARTICLES OF INCORPORATION

Section 9.02 Majority Voting. Notwithstanding the provisions of Section
---------------
9.01 of this Article Nine, if an amendment or repeal of a Section or Article of
the Restated Articles of Incorporation is approved by a majority of the
Continuing Directors (as defined below), voting separately and as a subclass of
directors, such amendment or repeal shall require the affirmative vote of the
holders of at least a majority of the outstanding shares entitled to vote
thereon. For the purpose of this Article Nine, "Continuing Director" means any
member of the Board of Directors (i) who was a member of the Board of Directors
on November 21, 1997, or (ii) who is elected to the Board of Directors after
November 21, 1997, after being nominated by a majority of the Continuing
Directors voting separately and as a subclass of directors on such nomination."

A-6
<PAGE>

SPECIALTY TELECONSTRUCTORS, INC.

PROXY

THIS PROXY IS SOLICITED ON BEHALF
OF THE BOARD OF DIRECTORS

I hereby constitute and appoint Michael R. Budagher and Dennis K. Hartnett
and each of them acting individually, my true and lawful agents and proxies,
with full power of substitution in each, to vote all shares held of record by me
at the Annual Meeting of Stockholders of Specialty Teleconstructors, Inc. to be
held on November 21, 1997 and any adjournments or postponements thereof. I
direct said proxies to vote as specified on the reverse side.

UNLESS OTHERWISE SPECIFIED, ALL SHARES WILL BE VOTED FOR THE ELECTION OF
ALL NOMINEES LISTED AND FOR EACH OF THE PROPOSALS TO BE ACTED UPON AT THE
ANNUAL MEETING. THIS PROXY ALSO DELEGATES DISCRETIONARY AUTHORITY TO VOTE
WITH RESPECT TO ANY OTHER BUSINESS WHICH MAY PROPERLY COME BEFORE THE
ANNUAL MEETING OR ANY ADJOURNMENT OF POSTPONEMENT THEREOF.

PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY.

1. PROPOSAL TO AMEND THE COMPANY'S ARTICLES OF INCORPORATION TO INCREASE THE
NUMBER OF AUTHORIZED SHARES OF CAPITAL STOCK OF THE COMPANY FROM 10 MILLION
TO 20 MILLION SHARES.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

2. PROPOSAL TO AMEND THE COMPANY'S ARTICLES OF INCORPORATION AND BYLAWS TO
CLASSIFY THE BOARD OF DIRECTORS OF THE COMPANY.

[ ] FOR [ ] AGAINST [ ] ABSTAIN

3. PROPOSAL TO ELECT SIX DIRECTORS FOR TERMS OF ONE TO THREE YEARS.

[ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY
(except as marked to the contrary to vote for all nominees listed
below) below:

CLASS I CLASS II CLASS III
(ONE YEAR INITIAL TERM) (TWO YEAR INITIAL TERM) (THREE YEAR INITIAL TERM)

Terry D. Farmer John D. Emery Michael R. Budagher
Frank D. Lackey Jon D. Word Ernie L. Carpenter

INSTRUCTION: To withhold authority to vote for an individual nominee or
nominees, write the person's name on the line below.

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

4. PROPOSAL TO RATIFY THE APPOINTMENT OF KPMG PEAT MARWICK LLP AS THE
INDEPENDENT AUDITORS FOR THE 1998 FISCAL YEAR.

[ ] FOR [ ] AGAINST [ ] ABSTAIN
<PAGE>

Please sign exactly as the name appears on this card. When shares are held
by joint tenants, both should sign. If signing as attorney, executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign in full corporate name by president or other authorized
officer. If a partnership, please sign in partnership name by an authorized
person.

________________________________________
(Signature)

________________________________________
(Signature if held jointly)

Dated: ___________________________, 1997

PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE ENCLOSED
BUSINESS REPLY ENVELOPE.