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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 21, 1999
EN POINTE TECHNOLOGIES, INC.
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(Exact name of registrant as specified in its charter)
Delaware 000-28052 75-2467002
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
100 N. Sepulveda Blvd., 19th Floor, El Segundo, California 90245
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (310) 725-5200
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Not Applicable
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(Former name or former address, if changed since last report)
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ITEM 2. Disposition of Assets.
From January 8, 1999 through February 16, 1999 in a series of sales, the
Company liquidated all of its stock and warrant holdings in Shopping.com, an
Internet company that was subsequently acquired by Compaq Computer
Corporation. This consisted of 125,000 shares of common stock originally
acquired September 23, 1997 at $6.00 per share (but subsequently written down
to $4.50 per share) and 199,800 warrants with an exercise price of $4.50 a
share. The stock and warrants were acquired from Shopping.com prior to their
initial public offering in exchange for five year licensing rights to the use
of the Company's propriety software.
The Company realized a gain of $1,680,533 upon sale of the common stock
and $2,747,250 upon exercise and sale of the warrants.
ITEM 5. Other Events.
In the Company's Annual Reports on Forms 10-K for the fiscal years ended
September 30, 1998 (as filed with the Securities and Exchange Commission on
December 29, 1998) and September 30, 1997 (as filed with the Securities and
Exchange Commission on December 29, 1997), the Company reported that it was
currently involved in litigation, having been named as a defendant, along
with its President, Chief Executive Officer and Chairman of the Board of
Directors, Attiazaz "Bob" Din, in a lawsuit filed April 29, 1997 in the
Superior Court for the County of Los Angeles, under the case name Novaquest
Infosystems, et. al. v. En Pointe Technologies, Inc., et al. The complaint
alleged that the Company and Bob Din misappropriated trade secret information
owned by the plaintiffs and further alleged that the defendants interfered
with the plaintiffs' prospective economic advantage.
On March 23, 1999, the jury returned a verdict in favor of the
plaintiffs and against the Company and Bob Din finding that they should pay
$50,000 in contract damages, plus $375,000 in
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tort damages to plaintiffs. The contract damages verdict carries with it
rights to claim an as-yet undetermined amount of reasonable attorneys' fees.
On April 2, 1999, the jury found that defendants should pay $1 million in
punitive damages to plaintiffs. A final judgment has not yet been entered;
contemplated post-trial motions may or may not result in a final judgment
different from the verdicts. The Company and Mr. Din are currently
considering whether to appeal the determination of the Court once a final
judgment has been entered. The Company will recognize a charge to reported
income of approximately $1.425 million for the quarter ending March 31, 1999,
to provide for this potential loss.
The Company issued a press release on April 13, 1999. A copy of the
press release is attached as Exhibit 99.1 and incorporated herein by this
reference.
ITEM 6. EXHIBITS
Exhibits:
99.1 Press Release dated April 13, 1999.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
EN POINTE TECHNOLOGIES, INC.
Date: April 21, 1999 By: /s/ Javed Latif
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Javed Latif, Chief Financial Officer
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EXHIBIT INDEX
Exhibits Description
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99.1 Press release dated
April 13, 1999
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EN POINTE ANTICIPATES THOROUGH REVIEW OF STATE COURT JURY VERDICT
EL SEGUNDO, CA -- April 13, 1999 -- In response to a jury verdict in a state
court trial in Los Angeles County, California, En Pointe Technologies, Inc.
(NASDAQ:ENPT) Senior Vice-President and General Counsel Jacob J. Stettin
today said: "Although we respect the jury system and the hard work of the
jury in this case, we believe that errors in the process misinformed the
jury's decision and that the jury would have reached a different result had
it been able to see all the facts. We look forward to a thorough review by
the trial judge and, if necessary, by the appropriate appellate tribunals."
In April of 1997, Novaquest Inc. and Webvision, Inc. filed suit against En
Pointe and its CEO, alleging that they had breached a prior settlement
agreement with plaintiffs and had libeled plaintiffs' software and interfered
with plaintiffs' prospective business advantage.
On March 23, 1999, the jury in the case returned a verdict against defendants
finding that they should pay $50,000 in contract damages, plus $375,000 in
tort damages to plaintiffs. The contract damages verdict carries with it
rights to claim an as-yet undetermined amount of reasonable attorneys' fees.
On April 2, 1999, the jury found that defendants should pay $1,000,000 in
punitive damages to plaintiffs. While the company may appeal the decision
once a judgement is entered and post-trial matters have been resolved, a
charge to reported income of approximately $1.425 million will be recognized
for the fiscal year ending September 30, 1999, to provide for this potential
loss.
"We are disappointed and surprised by the jury's decision, but we believe it
to be an aberration that runs contrary to applicable law and to the evidence
adduced in the case," continued Stettin. "We believe that the jury's verdict
is unfounded in the evidence and inconsistent in its internals. We believe
there was great jury confusion; the parties presented their cases to the jury
over a two-week period, after which the jury took some two weeks to return an
initial verdict. We believe that this apparent confusion and the courts'
review will ultimately mandate a vindication of our position."
About En Pointe
EN POINTE TECHNOLOGIES, INC. is a national provider of information technology
products and value-added services, utilizing proprietary software and systems
to drop-ship products to its customers through an electronically-linked
network of the largest allied distributors in the U.S. This software allows
En Pointe to serve as an electronic clearinghouse of computers and computer
related products without many of the risks and costs associated with
maintaining inventory. En Pointe offers its customers direct on-line access
to 70% of the mainstream PC distribution product. En Pointe Professional
Services offers "total solution" system consulting services such as: pre-sale
consulting, design, training, customization and integration.
En Pointe has nineteen sales offices throughout the United States, as well as
a value-added integration facility in Ontario, California. Visit En Pointe
on the Internet at www.enpointe.com and its Internet subsidiary at
www.firstsource.com.
CERTAIN STATEMENTS IN THIS PRESS RELEASE ARE FORWARD-LOOKING AND ARE SUBJECT
TO A VARIETY OF RISKS AND UNCERTAINTIES. THESE STATEMENTS MAY BE IDENTIFIED
BY THE USE OF FORWARD-LOOKING WORDS OR
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PHRASES SUCH AS "BELIEVE," "EXPECT," "ANTICIPATE," "SHOULD," "PLANNED,"
"ESTIMATED," AND "POTENTIAL," AMONG OTHERS. THESE FORWARD-LOOKING STATEMENTS
ARE BASED UPON THE COMPANY'S CURRENT PROJECTIONS, ESTIMATES AND EXPECTATIONS.
AMONG THE IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM MANAGEMENT'S PROJECTIONS, ESTIMATES AND EXPECTATIONS INCLUDE,
BUT ARE NOT LIMITED TO ACTIONS OF JUDICIAL OFFICERS AND GENERAL BUSINESS
CONDITIONS IN THE ECONOMY AND OTHER FACTORS REFERRED TO IN THE COMPANY'S
SECURITIES AND EXCHANGE COMMISSION FILINGS.
CONTACT: Jacob J. Stettin, En Pointe Technologies, Inc., 310-725-9773
