<PAGE>
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 /X/
Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
LEADING EDGE PACKAGING, 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)(1)
and 0-11
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
<PAGE>
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
Notes:
<PAGE>
[LOGO]
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
July 3, 1997
To the Stockholders of
LEADING EDGE PACKAGING, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders (the "Annual
Meeting") of LEADING EDGE PACKAGING, INC. (the "Company") will be held at The
Peninsula Hotel, 700 Fifth Avenue, Rejane Room, 3rd Floor, New York, New York,
on Monday, July 28, 1997 at 9:00 a.m. (New York time) for the following
purposes:
1. To elect the directors of the Company, all of whom shall hold office
until the next annual meeting of stockholders and until their successors are
elected and qualified;
2. To consider and vote upon a proposal to ratify the appointment of
Deloitte & Touche LLP as the Company's independent auditors for the fiscal
year ending March 31, 1998;
3. To consider and vote upon a proposal to adopt the Company's 1997
Associate Stock Option Plan; and
4. To transact such other business as may properly come before the
meeting.
By Order of the Board of Directors
CASEY K. TJANG, SECRETARY
ONLY STOCKHOLDERS OF RECORD AT THE CLOSE OF BUSINESS ON JUNE 10, 1997 WILL BE
ENTITLED TO NOTICE OF OR TO VOTE AT THE MEETING, OR ANY ADJOURNMENT THEREOF.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO ENSURE A QUORUM,
AS WELL AS YOUR REPRESENTATION, AT THE MEETING. EVEN IF YOU HAVE GIVEN YOUR
PROXY, YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE MEETING. PLEASE NOTE,
HOWEVER, THAT IF YOUR SHARES ARE HELD OF RECORD BY A BROKER, BANK OR OTHER
NOMINEE AND YOU WISH TO VOTE AT THE MEETING, YOU MUST OBTAIN FROM THE RECORD
HOLDER A PROXY ISSUED IN YOUR NAME.
<PAGE>
[LOGO]
350 FIFTH AVENUE
SUITE 3922
NEW YORK, NEW YORK 10118
MANAGEMENT PROXY STATEMENT
ANNUAL MEETING OF STOCKHOLDERS, JULY 28, 1997
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Leading Edge Packaging, Inc. (the
"Company") for use at the Annual Meeting of Stockholders of the Company to be
held at The Peninsula Hotel, 700 Fifth Avenue, Rejane Room, 3rd Floor, New York,
New York, on Monday, July 28, 1997, at 9:00 a.m. (New York time), or at any
adjournment thereof (the "Annual Meeting"). Proxy material is being mailed
beginning on July 7, 1997 to the Company's stockholders of record on the record
date. The total number of shares of the Common Stock outstanding and entitled to
vote on June 10, 1997 is 3,312,500.
The purposes of the Annual Meeting are: (1) to elect directors, (2) to
consider and vote upon a proposal to ratify the appointment of Deloitte & Touche
LLP as the Company's independent auditors for the fiscal year ending March 31,
1998, (3) to consider and vote upon a proposal to adopt the Company's 1997
Associate Stock Option Plan, and (4) to transact such other business as may
properly come before the meeting and at any adjournment thereof.
PROPOSALS SUBMITTED FOR STOCKHOLDER VOTE
PROPOSAL 1: ELECTION OF DIRECTORS.
At the Annual Meeting, five directors are to be elected to hold office until
the next annual meeting of stockholders and until their successors are elected
and qualified. Unless otherwise specified in the proxy, the shares represented
by the proxy hereby solicited will be voted for the persons named below, by the
persons designated as proxies, both of whom are now directors of the Company.
Should any of these nominees become unable to accept nomination or election
(which is not anticipated), it is the intention of the persons designated as
proxies to vote for the election of the remaining nominees named and for such
substitute nominees as the management may recommend.
The nominees are: Lip-Boon Saw, Casey K. Tjang, Peter L. Coker, Robert B.
Goergen and Richard Fung-Gea Wong.
Directors are elected by a plurality of shares of Common Stock represented
at the Annual Meeting.
INFORMATION WITH RESPECT TO NOMINEES
Information with respect to each nominee is set forth below. Additional
information with respect to officers, directors and major stockholders of the
Company, including their percentage ownership in the Company's voting stock, is
set forth on pages 4-8.
LIP-BOON SAW, age 40, has served as Chairman, Chief Executive Officer and
Director of the Company since April 1996. He served as the Company's President
from its inception through April 1996. From April 1994 until the time of the
Company's initial public offering he was also the Managing Director of Rich City
International Packaging Limited ("Rich City"), the Company's parent. He
continues to serve as a director of Rich City. Mr. Saw is the founder and sole
stockholder of L.B. Saw and Associates, Ltd., an investment firm in Hong Kong,
and has served as its Chairman since October 1992. Mr. Saw served as the
Managing Director of Ullmann Saw Associates, an investment advisory firm, from
January 1990 until October 1992. He currently serves on the boards of directors
of various privately-held manufacturing and investment advisory companies. Mr.
Saw spends a significant portion of his time in Hong Kong.
<PAGE>
CASEY K. TJANG, age 57, has served as Chief Financial Officer and Secretary of
the Company since 1996 and has been a Director of the Company since its
inception in 1995. Mr. Tjang served as Executive Director and President of
Starlite Holdings Limited (a public company listed on The Stock Exchange of Hong
Kong, Limited), from 1993 to 1995, and was responsible for facilitating the
acquisition of exclusive rights to distribute Hallmark greeting cards in the
Peoples' Republic of China (the "PRC") and of paper consumer products of Warner
Bros. characters in the PRC and Southeast Asia. From 1991 to 1993, Mr. Tjang
served as President and Chief Executive Officer of First Merchant Bankers, Inc.,
a company specializing in corporate finance and international trading. From 1979
to 1991, Mr. Tjang was the Managing Director and Vice President of the
International Department of Midlantic National Bank, managing corporate finance,
import-export and project finance transactions. Presently, he serves on the
board of directors of Kent Financial Services, Inc., a public company, and is
the Executive Director of Andrew-Case International Limited, a corporate finance
firm.
PETER L. COKER, age 54, has served as a Director of the Company since 1996. Mr.
Coker has been a director, Executive Vice President and a member of the
Investment Policy Committee of American Asset Management Company, New York since
1978. From 1968 to 1977 he was Assistant Vice President/ Investment Officer of
Bethlehem Steel Corporation with investment responsibilities for its
self-managed pension fund. From 1977 to 1978, Mr. Coker was a senior officer at
McGlinn Investment Service, Reading, Pennsylvania He currently sits on the
boards of directors of Remote Source Lighting International, Inc., Sweetbrier
Foods, Inc., Persimmon IT, Inc. and North Carolina State University Endowment
Fund. He is also a member of the New York Society of Security Analysts.
ROBERT B. GOERGEN, age 59, has served as a Director of the Company since 1996.
Since 1977, he has been the Chairman, and since 1978, the Chief Executive
Officer, of Blyth Industries, Inc., a public company and manufacturer and
importer of candles, home decorating accessories and home fragrance products.
Mr. Goergen has served as President of Blyth Industries, Inc. since 1994. From
1990 to the present, Mr. Goergen has served as Chairman of XTRA Corporation, a
public company in the trailer leasing industry. From 1979 to the present, he has
been Chairman of The Ropart Group, a private company, whose business is
investing in securities for its own account. Mr. Goergen currently serves as a
director of Blyth Industries, Inc. and XTRA Corporation and serves on the
Compensation Committee of XTRA Corporation.
RICHARD FUNG-GEA WONG, age 40, has served as a Director of the Company since
1995. From July 1994 to the present, Mr. Wong has served as the Executive
Director of Rich City, responsible for the supervision of the administration,
logistics and finance related matters. From October 1992 through June 1994, Mr.
Wong served as Manager of L.B. Saw & Associates, Ltd. From October 1990 until
October 1992, Mr. Wong served as General Manager of Lolliman Holdings Ltd., an
investment and property holding company. Mr. Wong will continue to spend a
significant portion of his time in Hong Kong.
MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES
In the last fiscal year the Board of Directors held one regularly scheduled
meeting and did not hold any special meetings. All other actions by the Board of
Directors were taken by unanimous written consent.
The Company has a Compensation Committee and an Audit Committee of the Board
of Directors, each consisting of two independent outside directors. The members
of the Compensation Committee are Lip-Boon Saw, Peter L. Coker and Robert B.
Goergen. The members of the Audit Committee are Casey K. Tjang, Peter L. Coker
and Robert B. Goergen. The Compensation Committee's function is to approve the
compensation packages (salary and bonus) of the Chief Executive Officer and the
named executive officers appearing in the Summary Compensation Table on page 7,
to administer the Company's 1996 Incentive Stock Option Plan and the 1997
Associate Stock Option Plan and to review the Company's
2
<PAGE>
compensation policies for all executive officers. The Compensation Committee
held one meeting in fiscal 1997. The Audit Committee recommends to the Board of
Directors the engagement of the independent auditors of the Company and reviews
with the independent auditors the scope and results of the Company's audits, the
professional services furnished by the independent auditors to the Company and
the auditors' management letter which comments on the Company's internal
accounting controls. The Audit Committee met once during fiscal 1997. The
Company does not have a special nominating or other committee charged with the
search for and recommendation to the Board of potential nominees for director.
This function is performed by the Board, which considers all recommendations for
potential nominees.
Directors who are not officers receive $1,000 per year as well as $500 per
meeting attended plus any costs to attend the meeting.
PROPOSAL 2: APPOINTMENT OF DELOITTE & TOUCHE LLP AS THE COMPANY'S INDEPENDENT
AUDITORS FOR THE FISCAL YEAR ENDING MARCH 31, 1998.
The Board of Directors has selected Deloitte & Touche LLP as the Company's
independent auditors for the fiscal year ending March 31, 1998, and has further
directed that management submit the selection of independent auditors for
ratification by the stockholders at the Annual Meeting. Deloitte Touche
Tomahtsu, an affiliate of Deloitte & Touche LLP, has audited the Company's
financial statements since its initial public offering. Representatives of
Deloitte & Touche LLP are expected to be present at the Annual Meeting, will
have an opportunity to make a statement if they so desire and will be available
to respond to appropriate questions.
Stockholder ratification of the selection of Deloitte & Touche LLP as the
Company's independent auditors is not required by the Company's By-laws or
otherwise. However, the Board is submitting the selection of Deloitte & Touche
LLP to the stockholders for ratification as a matter of good corporate practice.
If the stockholders fail to ratify the selection, the Audit Committee and the
Board will reconsider whether or not to retain that firm. Even if the selection
is ratified, the Audit Committee and the Board in their discretion may direct
the appointment of different independent auditors at any time during the year if
they determine that such a change would be in the best interests of the Company
and its stockholders.
The Board of Directors recommends a vote "For" this proposal to ratify the
appointment of Deloitte & Touche LLP as the Company's independent auditors for
the fiscal year ending March 31, 1998.
PROPOSAL 3: ADOPTION OF THE COMPANY'S 1997 ASSOCIATE STOCK OPTION PLAN.
The 1997 Associate Stock Option Plan (the "1997 Plan") is intended to enable
the Company to provide an incentive to attract and retain qualified employees,
consultants and directors (collectively, the "Associates") to serve the Company
and to further the identity of interests of the Associates and stockholders of
the Company. The Plan provides for the grant of non-qualified stock options to
non-family outside directors, consultants hired by the Company and employees not
otherwise qualified to receive options under the 1996 Incentive Stock Option
Plan (the "1996 Plan"). Until December 5, 1998, options to purchase a maximum of
312,500 shares of the Company's Common Stock in the aggregate, taken together
with options issued under the 1996 Plan, may be granted under the 1997 Plan.
After December 5, 1998, the maximum number of shares underlying options issuable
under the 1997 Plan will be 400,000.
The 1997 Plan was approved by the Company's Board of Directors at its
meeting on June 18, 1997, subject to the approval of the stockholders. The 1997
Plan would be administered by the Compensation Committee, subject to the
discretion of the full Board of Directors.
The exercise price per share will be equal to 110% of the closing price of
the Company's Common Stock on the Nasdaq National Market on the day prior to the
date of grant but will in no event be less than $6.00 per share.
3
<PAGE>
The Board of Directors believes that approval of the 1997 Plan is in the
best interests of all stockholders and recommends a vote "For" this Proposal.
The favorable vote of the holders of a majority of the shares of Common
Stock represented at the Annual Meeting is needed to approve this Proposal No.
3.
SECTION 16(A) REPORTING
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers, and persons who own more than 10% of a
registered class of the Company's Common Stock, to file with the Securities and
Exchange Commission and the Nasdaq National Market initial reports of ownership
and reports of changes in ownership of the Common Stock of the Company.
Officers, directors and greater than 10% stockholders are required by SEC
regulations to furnish the Company with copies of all Section 16(a) forms they
file. To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended March 31, 1997, all Section
16(a) filing requirements applicable to its officers and directors were complied
with except that Messrs. Saw, Wong, Chu, Tjang, Ben-Moshe and Goergen failed to
timely file their initial Forms 3 with respect to the Company's Common Stock. No
new transactions in the Company's securities were reported on the forms for
Messrs. Saw, Wong, Chu, Tjang or Ben-Moshe. Messrs. Saw and Wong reported their
indirect beneficial ownership of shares held by Rich City, which results from
their respective positions held with Rich City. Both of them disclaim beneficial
ownership of these securities. Mr. Goergen reported 15,000 shares purchased on
December 5, 1996 in a Form 5 filed at the end of the Company's fiscal 1997.
HOLDINGS OF MANAGEMENT AND OF HOLDERS
OF 5% OR MORE OF THE COMPANY'S COMMON STOCK
The following table sets forth certain information regarding the ownership
of the Company's Common Stock as of June 10, 1997 by (i) each director and
nominee for director; (ii) each of the executive officers named in the Summary
Compensation Table employed by the Company in that capacity on June 10, 1997;
(iii) all executive officers and directors of the Company as a group; and (iv)
all those known by the Company to be beneficial owners of more than five percent
of its Common Stock.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL
OWNERSHIP PERCENT OF
AS OF OUTSTANDING
ADDRESS OF BENEFICIAL OWNER JUNE 10, 1997 SHARES
----------------------------------------- ------------- -----------------
<S> <C> <C> <C>
Rich City International (1)
Packaging Limited.................... Rm. 402-3 Join-in Hang Sing Centre, 1,875,000 57%
71-75 Container Port Road
Kwai Chung, N.T. Hong Kong
Lip-Boon Saw, Chairman (2)
and Chief Executive Officer.......... 350 Fifth Avenue, Suite 3922 1,875,000 57%
New York, NY 10118
Peter Yu-Siu Chu, President and Chief
Operating Officer.................... 350 Fifth Avenue, Suite 3922 --
New York, NY 10118
Dan Ben-Moshe, Vice President,
Marketing and Sales.................. 350 Fifth Avenue, Suite 3922 --
New York, NY 10118
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
BENEFICIAL
OWNERSHIP PERCENT OF
AS OF OUTSTANDING
ADDRESS OF BENEFICIAL OWNER JUNE 10, 1997 SHARES
----------------------------------------- ------------- -----------------
<S> <C> <C> <C>
Casey K. Tjang, Chief Financial
Officer, Secretary and Director...... 350 Fifth Avenue, Suite 3922 --
New York, NY 10118
Robert B. Goergen, Director............ c/o Blyth Industries, Inc. 15,000 *
100 Field Point Road
Greenwich, CT 06830-6442
Peter L. Coker, Director............... 1305 Statestone Ct. --
Raleigh, NC 27615
Richard Fung-Gea Wong, Director (2).... 350 Fifth Avenue, Suite 3922 1,875,000 57%
New York, NY 10118
All Directors and Officers as a
Group................................ 1,890,000 57%
</TABLE>
(1) Rich City is an indirect wholly-owned subsidiary of Chung Hwa Development
Holdings Limited, a company whose securities are listed on The Stock
Exchange of Hong Kong Limited.
(2) Messrs. Saw and Wong are directors of Rich City and both disclaim beneficial
ownership of securities with respect to which their ownership is specified.
* Represents less than 1% of the Company's outstanding Common Stock.
CERTAIN TRANSACTIONS
The Company entered into an Assignment and Distribution Agreement (the
"Distribution Agreement"), effective April 1, 1996, with Rich City, the
Company's majority stockholder. Under the Distribution Agreement, Rich City
assigned to the Company the exclusive rights for North America to market,
distribute, sell and warehouse the packaging products which Rich City had
supplied in the United States and Canada. In addition, all sales of packaging
products in North America, as well as all sales of such products in Hong Kong or
elsewhere for delivery into North America, for which sales Rich City rendered
invoices after March 31, 1996, are for the account of the Company. The
Distribution Agreement also grants to the Company the exclusive ancillary right
to customize those products. To facilitate the assignment to the Company of
these exclusive rights under the Distribution Agreement, Rich City has also
assigned to the Company its lists of actual and potential North American
customers for the packaging products. Furthermore, Rich City has agreed to refer
to the Company all inquires it receives in Hong Kong with respect to sales of
packaging products for delivery into North America. Under the Distribution
Agreement the Company can expand those exclusive rights to South America upon
payment of one or more annual royalties on terms at least as favorable to the
Company as those contained in the Distribution Agreement.
Under the Distribution Agreement, the Company is to pay Rich City a royalty
of $2,000,000, in installments to commence with the Company's fiscal year ending
March 31, 1999. The amount of any installment should be the arithmetic average
of two percent of net sales of the Company and 10% of the Company's earnings
before taxes in the prior fiscal year. No installment is payable with respect to
any fiscal year unless the Company in the prior year has both net sales of at
least $25,000,000 and earnings before taxes of at least $3,000,000. The
Distribution Agreement requires that the Company give to Rich City the right of
first refusal to supply packaging products on no less favorable terms and
conditions than those
5
<PAGE>
offered by a third party. As to any product which Rich City fails to exercise
such right of first refusal, the Company may purchase that product from any
other source. To maintain the exclusive rights, the Company must meet certain
minimum sales increases per annum specified below.
The term of the Distribution Agreement is for a period of ten years and,
thereafter, is automatically renewed for successive additional one year periods.
Either party may terminate the Distribution Agreement on notice to the other in
the event that the other party suffers a severe financial reversal, such as the
filing of a petition in bankruptcy, or a governmental expropriation or
condemnation of material assets or capital stock, or a dissolution or
liquidation. Furthermore, the Distribution Agreement can be terminated in the
event that a defaulting party breaches a material term of the Distribution
Agreement and fails to remedy such breach within a 90 day cure period. Under the
Distribution Agreement the Company must maintain its Manhattan showroom as well
as its trained sales force to promote the sale of the packaging products;
conduct promotional campaigns and marketing strategies to stimulate sales of
products; attend trade fairs and expositions to market the packaging products;
and maintain its customization capability. In turn, Rich City is required to
allocate the manufacturing facilities it uses so as to give first priority to
the acceptance and fulfillment of the Company's purchase orders.
The Company's exclusive rights under the Distribution Agreement are
converted to non-exclusive rights in the event that (i) the Company fails to pay
timely (including a 60 day grace period running from the notice of such
non-payment) an installment of the $2,000,000 royalty described above; or (ii)
if in any given fiscal year the Company fails to increase its sales of the
packaging products in North America in accordance with the cost of living
formula contained in the Distribution Agreement and the parties fail to
negotiate the minimum sales requirement to a level which the Company can
satisfy. This minimum sales increase requirement is not effective if general
economic conditions in North America mitigate against such growth, or if the
Company can demonstrate good cause for the failure to meet the minimum sales for
the year in which such failure occurred.
When the Company places an order with Rich City, the Distribution Agreement
requires the Company to advance to Rich City that estimated portion of the
purchase price representing the costs of materials for the products under that
order. Rich City's invoices to the Company are to contain appropriate credits to
reflect payments made for these advances.
EXECUTIVE COMPENSATION
EXECUTIVE OFFICERS
In addition to the directors who serve as executive officers of the Company,
and whose biographical information appears on pages 1 and 2 above, the following
individuals are also executive officers of the Company:
PETER YU-SIU CHU, age 44, has served as President and Chief Operating
Officer of the Company since September 1996. From April 1994 until the time of
this offering, he was the General Manager of Production and Operations of Rich
City, the Company's parent. As such, he was responsible for coordinating the
production of packaging products by Rich City's affiliates in the PRC and the
distribution operations of Rich City, including supervision of staff dedicated
to these operations. From 1987 through March 1994, he served as General Manager
of Production of Contimach Ltd., a PRC-based manufacturer of power transmission
products, where he supervised the company's production process.
DAN BEN-MOSHE, age 39, has served as Vice President, Marketing and Sales of
the Company since September 1996. From 1994 to the present, Mr. Ben-Moshe was
the President of Astucci U.S., Ltd, a wholesale distributor of packaging
products, where he was responsible for obtaining brand name optical
manufacturing accounts for the company. From 1991 to 1994, he served as a
marketing agent for Jewelpak Corp., a wholesale distributor of packaging
products, where he sold packaging products to manufacturers and retailers of
jewelry, watches and eyewear.
6
<PAGE>
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth the annual compensation for the Chief
Executive Officer and all other executive officers of the Company:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM COMPENSATION
------------------------------
AWARDS
ANNUAL COMPENSATION ----------- PAYOUTS
------------------------------------------ SECURITIES -----------------
OTHER ANNUAL UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION OPTIONS COMPENSATION
- ------------------------------------------- --------- ---------- ----------- ----------------- ----------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Lip-Boon Saw, Chairman and Chief Executive
Officer.................................. 1997 $ 120,000 -- -- 60,000 --
Peter Yu-Siu Chu, President and Chief
Operating Officer........................ 1997 40,000 -- -- 50,000 --
Dan Ben-Moshe, Vice President, Marketing &
Sales.................................... 1997 32,000 -- -- 50,000 --
Casey K. Tjang, Chief Financial Officer and
Secretary................................ 1997 32,000 -- -- 40,000 --
</TABLE>
COMPENSATION OF DIRECTORS
Non-employee directors of the Company are paid a fee of $1,000 per year
(payable at the end of the year) as well as $500 per meeting attended plus costs
of attending the meeting (payable after the meeting's adjournment).
Subject to its approval of the Company's stockholders at the Annual Meeting,
non-employee directors will be eligible to participate in grants of stock
options under the 1997 Plan. Upon such approval, options previously granted
under the 1996 Plan to such directors will be replaced with options under the
1997 Plan on terms no less favorable to such directors.
1996 INCENTIVE STOCK OPTION PLAN
Executive officers may receive, in addition to their salaries and other
compensation, options for the Company's Common Stock. Prior to its initial
public offering, the Company adopted the 1996 Plan under which stock options may
be granted to such officers, directors and/or, employees of the Company as the
Compensation Committee selects. 312,500 shares of Common Stock are reserved for
that purpose, 250,000 of which have been granted as of the date of this Proxy
Statement. Stock options entitle the holder to acquire shares of Common Stock
during a fixed period at an exercise price equal to the greater of (i) 110% of
the fair market value of the Common Stock at the time of grant and (ii) the
initial public offering price per share in this offering. Payment by option
holders upon exercise of an option may be made only in cash.
7
<PAGE>
OPTION GRANTS IN THE LAST FISCAL YEAR
During fiscal 1997, the following stock options were granted:
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
------------------------------ POTENTIAL REALIZABLE VALUE
PERCENTAGE
NUMBER OF OF TOTAL AT ASSUMED ANNUAL RATES OF
SECURITIES OPTIONS STOCK PRICE APPRECIATION
UNDERLYING GRANTED FOR OPTION TERM
OPTIONS EMPLOYEES EXERCISE OR EXPIRATION --------------------------
NAME GRANTED IN FY BASE PRICE DATE 5% 10%
- ------------------------------------------ ----------- ----------------- ----------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Lip-Boon Saw.............................. 60,000 24% $7.15 per 12/11/06 206,268.90 582,559.56
share
Peter Yu-Siu Chu.......................... 50,000 20% ' ' 171,890.75 485,466.30
Dan Ben-Moshe............................. 50,000 20% ' ' 171,890.75 485,466.30
Casey K. Tjang............................ 40,000 16% ' ' 137,512.60 388,373.04
Peter L. Coker (1)........................ 15,000 6% ' ' 51,567.23 145,639.89
Robert B. Goergen (1)..................... 15,000 6% ' ' 51,567.23 145,639.89
Richard Fung-Gea Wong (1)................. 20,000 8% ' ' 68,756.30 194,186.52
</TABLE>
- ------------------------
(1) Options granted to non-employee directors under the 1996 Plan will be
replaced with options under the 1997 Plan, subject to the stockholders'
approval of the 1997 Plan at the Annual Meeting.
AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES
No options issued by the Company were exercisable or "in-the-money" in
fiscal 1997. The following table lists the number of securities underlying
unexercised options at March 31, 1997:
<TABLE>
<CAPTION>
NUMBER OF
SECURITIES
UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED OPTIONS IN-THE-MONEY OPTIONS AT
AT FY-END FY-END
------------------- -----------------------
SHARES ACQUIRED EXERCISABLE/ EXERCISABLE/
NAME ON EXERCISE VALUE REALIZED UNEXERCISABLE UNEXERCISABLE
- -------------------------------------- ------------------- ------------------- ------------------- -----------------------
<S> <C> <C> <C> <C>
Lip-Boon Saw.......................... -- -- -- /60,000 --
Peter Yu-Siu Chu...................... -- -- -- /50,000 --
Dan Ben-Moshe......................... -- -- -- /50,000 --
Casey K. Tjang........................ -- -- -- /40,000 --
Peter L. Coker........................ -- -- -- /15,000 --
Robert B. Goergen..................... -- -- -- /15,000 --
Richard Fung-Gea Wong................. -- -- -- /20,000 --
</TABLE>
8
<PAGE>
REPORT OF THE COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
GENERAL
INTRODUCTION. The Compensation Committee (the "Committee"), with Lip-Boon
Saw as its Chairman, is responsible for determining the compensation to be paid
to the Company's executive officers. The Committee is also responsible for
making policy decisions regarding recruitment and compensation of executive
officers and key employees.
The Committee's philosophy with respect to the compensation of the Company's
executive officers is (i) to provide a fair and competitive compensation package
that enables the Company to attract and retain experienced and qualified
executives and align their compensation with the Company's overall business
strategies and goals, and (ii) to create an internal executive incentive
initiative by allowing the Committee to grant key personnel an equity stake in
the Company through stock options.
To this end, the Committee determines executive compensation with a focus on
individual levels of responsibility and the Company's overall performance. The
primary components of the Company's executive compensation program are base
salaries and stock options.
ADDING EXECUTIVE STAFF. The Company plans to recruit additional marketing
and sales personnel to increase sales and pursue the market of high quality
paper shopping bags, premium paper items and specialty paper boxes. Adding such
additional personnel, is part of the Company's aggressive growth strategy in
this estimated $350 million-per-year U.S. market. This will compliment the
Company's current packaging business and offer a broader product line to the
Company's customers. In furtherance of this strategy, Mr. Sung Ki Park has
joined the Company to head this new products group with an annual salary of
$72,000.
STOCK OPTIONS. All of the Company's executive officers are eligible to
receive options under the 1996 Plan. However, non-employees, including
directors, were not eligible under the 1996 Plan. The 1997 Plan, which will be
presented to the stockholders at the Annual Meeting and was approved by the
entire board of directors at its meeting on June 18, 1997, gives the Committee
the authority to award stock options to deserving individuals, other than
employee's, who have performed well. Under the 1997 Plan, any key person who's
performance is exceptional, may be assigned stock options as both a motivating
tool and an incentive by which the Committee can reward such performance. There
are 312,000 stock options available in the aggregate for distribution by the
Committee, 250,000 of which have been granted.
EMPLOYMENT AGREEMENTS
Effective April 1, 1996, the Company entered into an employment agreement
with Lip-Boon Saw as Chairman and Chief Executive Officer for an initial term of
three years. The agreement provides for a salary of $120,000 for the first year.
On September 23, 1996, the Company entered into employment agreements, which
became effective upon the consummation of the Company's initial public offering,
with Peter Yu-Siu Chu as President and Chief Operating Officer, Casey K. Tjang
as Chief Financial Officer and Secretary, and Dan Ben-Moshe as Vice
President/Marketing and Sales. Each of these agreements is for an initial term
of three years.
The employment agreements with Messrs. Chu, Tjang and Ben-Moshe provide for
initial annual salaries of $96,000, $60,000 and $96,000, respectively. The base
salaries for the all executives, under their respective employment agreements,
were unchanged through March 31, 1997. Effective April 1, 1997, Mr. Tjang's
annual base salary was increased to $84,000 from $60,000.
9
<PAGE>
The employment agreements with Messrs. Saw, Chu, Tjang and Ben-Moshe each
provide that salaries for the second and third years may be determined by the
Board of Directors. Each agreement also provides for bonuses as may be
determined by the Board of Directors in its sole discretion. Each agreement may
be terminated by either the Company or the employee on six months' prior notice,
and prohibits the employee from soliciting other Company employees during the
two-year period following his termination of employment. Mr. Saw's employment
agreement also provides that for two years after the termination of his
employment, he will not have an ownership interest in, nor be employed by, any
business which directly competes with the business of the Company. With the
exception of Mr. Saw, who is required to devote a majority of his time and
efforts to the Company's business, Messrs. Chu, Tjang and Ben-Moshe are required
to devote their full time and efforts to the business of the Company.
No bonuses have been issued to the Company's executive officers and no
bonuses are planned in the 1998 fiscal year.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Lip-Boon Saw, the Company's Chairman and Chief Executive Officer, is a
member of the Committee. His presence on the Committee creates a possible
conflict of interest inasmuch as the Committee sets the compensation level for
the Chairman and Chief Executive Officer each year, along with that of the other
executive officers. The compensation levels set by the Committee are subject to
approval by the entire Board of Directors. Mr. Saw is also a Director of Rich
City, which owns a majority of the Company's outstanding Common Stock.
Submitted by:
Lip-Boon Saw
Peter L. Coker
Robert B. Goergen
10
<PAGE>
FOUR MONTH PERFORMANCE GRAPH
COMPARISON OF FOUR MONTH CUMULATIVE TOTAL RETURN*
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
DATE PRICE
<S> <C> <C> <C>
Leading Edge Packaging,
Inc. Nasdaq Composite Nasdaq Non-Financial Index
12/2/96 $100 $100 $100
3/31/97 $84.70 $92.20 $94.10
</TABLE>
- ------------------------
* Assumes $100 invested on December 2, 1996 in Leading Edge Packaging, Inc.
Common Stock and the Nasdaq Composite and Non-Financial Index.
The preceding Report of the Compensation Committee and Performance Graph are
not "soliciting material", are not deemed "filed" with the SEC and are not
intended to be incorporated by reference in any filing of the Company under the
Securities Act of 1933 or the Securities Exchange Act of 1934, whether made
before or after the date hereof and irrespective of any general incorporation
language in any such filing.
GENERAL INFORMATION
INFORMATION AS TO VOTING SECURITIES
Holders of shares of Common Stock have the right to one vote for each share
registered in their names on the books of the Company as of the close of
business on June 10, 1997. On such date 3,312,500 shares of Common Stock were
outstanding and entitled to vote.
11
<PAGE>
The close of business on June 10, 1997 has been fixed by the Board of
Directors as the record date for the determination of stockholders entitled to
notice of, and vote at, the Annual Meeting.
VOTING AND REVOCATION OF PROXIES
The persons named in the accompanying form of proxy will vote the shares
represented thereby, as directed in the proxy, if the proxy appears to be valid
on its face and is received on time. In the absence of specific instructions,
proxies so received will be voted for the election of the named nominees to the
Company's Board of Directors, for the ratification of Deloitte & Touche LLP as
the Company's independent auditors for fiscal 1998 and for the 1997 Plan.
Proxies are revocable at any time before they are exercised by attending the
Annual Meeting and voting in person, by filing an instrument in writing revoking
the proxy or by delivering a proxy bearing a later date to the Secretary of the
Company.
METHOD AND EXPENSE OF PROXY SOLICITATION
The solicitation of proxies will be made primarily by mail by Continental
Stock Transfer & Trust Co. Proxies may also be solicited by overnight courier,
personally and by telephone by regular employees of the Company at nominal cost.
The Company does not expect to pay compensation for any solicitation of
proxies but may pay brokers and other persons holding shares in their names, or
in the names of nominees, their expenses for sending proxy material to
principals for the purpose of obtaining their proxies. The Company will bear all
expenses in connection with the solicitation of proxies.
INDEPENDENT AUDITORS
The Board of Directors of the Company has appointed Deloitte Touche Tomahtsu
to audit the accounts of the Company for the fiscal year ended March 31, 1997.
Management does not believe it is necessary for stockholders to ratify this
appointment due to the satisfactory services of Deloitte Touche Tomahtsu in
prior years and the impracticality and undue expense of calling a special
stockholders meeting solely for that purpose. There is no requirement under
federal or Delaware law or the Company's By-laws that the appointment of
independent auditors be approved by stockholders. Management's recommendation
for the appointment of Deloitte Touche Tomahtsu was unanimously approved by the
Audit Committee of the Board of Directors consisting of Messrs. Tjang, Coker and
Goergen.
STOCKHOLDER PROPOSALS
Stockholder proposals intended to be presented at the Company's 1998 Annual
Meeting of Stockholders pursuant to the provisions of Rule 14a-8 of the
Securities and Exchange Commission, promulgated under the Securities Exchange
Act of 1934, as amended, must be received at the Company's offices in New York,
New York by March 30, 1998 for inclusion in the Company's proxy statement and
form of proxy relating to that meeting.
GENERAL
The Company's 1997 Annual Report is being mailed to stockholders
simultaneously with this Proxy Statement. A copy of the Company's Annual Report
on Form 10-K will be furnished to any stockholder who requests the same free of
charge (except for Exhibits thereto for which a nominal fee covering
reproduction and mailing expenses will be charged).
12
<PAGE>
OTHER MATTERS
As of the date of this Proxy Statement, other than Proposals 1 and 2 and the
election of directors to come before the Annual Meeting. However, if any other
matters should properly come before the meeting, it is the intention of the
persons named in the accompanying form of proxy to vote all proxies not marked
to the contrary in accordance with their judgment on such matters.
By Order of the Board of Directors
CASEY K. TJANG, Secretary
13
<PAGE>
ANNEX A
LEADING EDGE PACKAGING, INC.
1997 ASSOCIATE STOCK OPTION PLAN
1. PURPOSE. Leading Edge Packaging, Inc. (the "Company") hereby establishes
the Leading Edge Packaging, Inc. 1997 Associate Stock Option Plan (the "Plan").
The purpose of the Plan is to advance the interests of the Company and its
stockholders by encouraging participation in the ownership and economic progress
of the Company by the Company's Associates (as defined in Section 3) and to
provide such Associates with an opportunity to participate in the increased
value of the Company which their effort, initiative, and skill have helped
produce. The stock options granted under this Plan will be nonstatutory stock
options not intended to qualify as incentive stock options within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code").
2. ADMINISTRATION.
(a) The Plan will be administered by a Plan committee (the "Committee"),
designated by the Board of Directors of the Company (the "Board"), which shall
include one or more members of the Board; provided, however, that at any time
that the Company becomes subject to the reporting requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), the Board may appoint
members to the Committee, and the Committee must act, only in accordance with
the requirements of Rule 16b-3 promulgated pursuant to Section 16(b) of the
Exchange Act ("Rule 16b-3"). The Committee may make such rules and regulations
and establish such procedures as it deems appropriate for the administration of
this Plan. The Committee may interpret this Plan, prescribe, amend or rescind
any rules and regulations necessary or appropriate for the administration of
this Plan, and make such other determinations and take such other action as it
deems necessary or advisable. Any interpretation, determination or other action
made or taken by the Committee shall be final, binding and conclusive, and the
decision of the Committee shall be final and binding upon all parties in
interest, including the Company and its stockholders. Any decision or
determination reduced to writing and signed by all members of the Committee
shall be fully as effective as if made by unanimous vote at a meeting duly
called and held.
(b) The Committee may employ such legal counsel, consultants and agents as
it may deem desirable for the administration of this Plan and may rely upon any
opinion received from any such counsel or consultant and any computation
received from any such consultant or agent.
(c) No member or former member of the Committee shall be liable for any
action or determination made in good faith with respect to this Plan or any
option awarded under it. To the maximum extent permitted by applicable law, each
member or former member of the Committee shall be indemnified and held harmless
by the Company against any cost or expense (including counsel fees) or liability
(including any sum paid in settlement of a claim) arising out of any action or
omission to act in connection with this Plan, unless arising out of such
member's or former member's own fraud or bad faith. Such indemnification shall
be in addition to any rights of indemnification the member or former member may
have as director or under the By-laws of the Company.
(d) The Committee shall have complete authority in its sole discretion to
determine which participants under this Plan shall be granted options and the
number of shares of the Company's stock to be subject to each option.
(e) The Committee shall report to the Board annually the names of those
Associates granted options during the preceding year, the number of shares
covered by each option and the applicable option prices.
3. ELIGIBILITY. The individuals who shall be eligible to participate in
this Plan and to receive options shall be such Associates of the Company or any
subsidiary (the "Subsidiary"), within the definition of subsidiary corporation
in Section 424(f) of the Code, or any similar provision hereinafter enacted, as
the Committee shall from time to time determine. The term "Associate" shall
mean:
<PAGE>
(a) any person employed by the Company or any Subsidiary on the basis of
an employer-employee relationship who receives remuneration for personal
services rendered to the Company;
(b) any person who renders consulting services to the Company or any
Subsidiary; and
(c) active members of the Board of Directors of the Company or any
Subsidiary whether or not, as of the date of any option grant, they are
employees of the Company.
4. STOCK SUBJECT TO PLAN.
(a) Options may be granted permitting the purchase in the aggregate of not
more than 400,000 shares of the Company's common stock, par value, $0.01 per
share ("Common Stock") provided that until December 5, 1998 the number of shares
issuable pursuant to options granted under this Plan shall not, when aggregated
with the shares issuable pursuant to options granted under the Company's 1996
Incentive Stock Option Plan (the "1996 Plan"), exceed 312,500 shares. These
shares may consist either in whole or in part of shares of the Company's
authorized but unissued Common Stock or shares of the Company's authorized and
issued Common Stock reacquired by the Company and held in its treasury. If an
option granted under this Plan is surrendered or for any other reason ceases to
be exercisable in whole or in part, the shares which were subject to any such
option but as to which the option ceases to be exercisable shall again be
available for options to be granted under this Plan.
(b) The total number of shares of the Common Stock as to which an option or
options may be granted under this Plan to any one Associate shall not exceed
100,000 shares.
5. STOCK OPTIONS.
(a) OPTION PRICE. The price at which options may be granted under the Plan
and the effective date of such grant shall be determined as follows:
(1) The per share option price of the Common Stock subject to each
option shall be at least equal to the greater of (x) one hundred ten (110%)
percent of the fair market value of a share of Common Stock on the date that
the option is granted and (y) six dollars ($6) per share.
For purposes of this Plan, fair market value of a share of Common Stock
shall be determined by reference to the last reported closing price of a
share on any national securities exchange upon which the shares of Common
Stock are listed (or the average of the closing bid and asked price or other
applicable published share quotation if the shares are not then traded on a
national securities exchange) on the trading day next preceding the date of
the grant or exercise of the option, as the case may be, or the last third
party sale within a one-month period prior to the date of grant, or if no
such third party sales, the last price at which shares of Common Stock were
sold or redeemed by the Company if no public market or pink sheet share
quotations then exist for the shares, whichever is applicable.
(2) Notwithstanding anything to the contrary contained herein, any
options issued under this Plan, which are so issued in replacement of or
substitution for options previously issued under the 1996 Plan, shall be
exercisable at the same exercise price as the options issued under the 1996
Plan which they are intended to replace.
(3) The Committee shall, after it approves the granting of an option to
an Associate, cause the Associate to be notified of such action. The date on
which the Committee approves the granting of an option shall be considered
the date on which such option is granted irrespective of the date on which
the Associate is notified.
(b) EXERCISE OF OPTION. The right to purchase shares covered by any option
or options under this Plan shall be exercisable only in accordance with the
terms and conditions of the grant to such optionee as evidenced by a stock
option agreement in such form, not inconsistent with this Plan, as the Committee
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<PAGE>
shall approve from time to time. Options granted under the Plan shall be
exercised in the following manner:
(1) The right to purchase shares covered by any option or options
granted under this Plan shall not be exercisable until the expiration of
twelve months from the date such option is granted except in the event of
the death or permanent and total disability (within the meaning of Section
22(e)(3) of the Code) of the optionee within such period, in which event
such option or options shall be deemed exercisable for purposes of Section
5(c)(2) hereof without regard to such twelve-month period.
(2) The Committee may, in its discretion, provide that such option or
options may be exercised in whole or in part in installments, cumulative or
otherwise, for any period or periods of time specified by the Committee of
not less than twelve months nor more than ten years from the date of the
grant of the option. Subject to the provisions of subdivision (b)(3) of this
Section 5, that portion of an option which is exercisable on an installment
basis may not be exercised prior to the expiration of the applicable
installment period.
(3) If the optionee shall continue as an Associate during the whole of
any period for which an installment of shares shall have been allotted by
the terms of any option granted such optionee under this Plan, the option
thereupon shall be exercisable with respect to such shares in accordance
with the terms and conditions of the grant of such option to such optionee.
(4) Notwithstanding anything to the contrary contained herein, any
options issued under this Plan, which are so issued in replacement of or
substitution for options previously issued under the 1996 Plan, shall be
deemed to have been granted on the same date as the options issued under the
1996 Plan which they are intended to replace and on terms and conditions no
less favorable to the grantee than the options issued under the 1996 Plan,
except with respect to tax treatment of the options on their exercise.
(c) EXPIRATION OR TERMINATION OF OPTION.
(1) Each option and all rights and obligations thereunder shall, subject
to the provisions of subdivision (c)(2) of this Section 5, expire on a date
to be determined by the Committee, such date, however, in no event to be
later than ten years from the date on which the option is granted.
(2)(i) In the event an optionee shall cease being an Associate as
determined by the Committee, as the result of any reason whatsoever other
than "for cause", then an option granted to such optionee shall, to the
extent then exercisable, be exercisable within three months after such
optionee ceases to be an Associate. Following the expiration of such
three-month period, any option granted to such optionee shall terminate and
may no longer be exercised.
(ii) If the optionee dies or becomes permanently and totally disabled
(within the meaning of Section 22(e)(3) of the Code) while an Associate,
such option (without regard to any installment limitations provided in
Section 5(b)(2)) hereof may, within one year after such optionee ceases to
be an Associate (or within such shorter period as may be specified in the
option by the Committee), be exercised by such optionee or the person or
persons to whom the optionee's rights under the option shall pass by will or
by the applicable laws of descent and distribution; provided, however, that
an option may not be exercised to any extent by any person after the
expiration of the option according to its terms.
(iii) In the event an optionee shall cease to be an Associate as the
result of any circumstance other than those referred to above in subdivision
(c)(2)(i) or (ii) of this Section 5, then all options granted to such
optionee under this Plan shall terminate and no longer be exercisable as of
the date such optionee ceases to be an Associate.
(iv) An optionee who is prevented from performing services as an
Associate because of such optionee's disability (other than as provided in
subdivision (c)(2)(ii) of this Section 5), or who is on
A-3
<PAGE>
leave of absence for the purpose of serving in a military capacity the
government of the country in which the principal place of business of the
Company or any Subsidiary is located, or for such other purpose or reason as
the Committee may specifically approve, shall not during the period of any
such absence be deemed, by virtue of such absence alone, to have terminated
such status as an Associate except as the Committee may otherwise expressly
provide. All rights which such optionee would have had to exercise options
granted hereunder will be suspended during the period of such leave of
absence and may be exercised cumulatively by such optionee upon his resuming
services as an Associate provided such options are exercised within ten
years after the grant thereof.
6. CAPITAL ADJUSTMENTS. The aggregate number of shares of the Company's
Common Stock subject to this Plan, the maximum number of shares as to which
options may be granted to any one optionee hereunder, and the number of shares
and the price per share subject to outstanding options shall be appropriately
adjusted for any increase or decrease in the number of shares of Common Stock
which the Company has issued resulting from any stock split, stock dividend,
combination of shares or any other change, or any exchange for other securities
or any reclassification, reorganization, redesignation, recapitalization, or
otherwise.
7. NONTRANSFERABILITY. An option granted under the Plan may not be
transferred except by will or the laws of descent and distribution and, during
the lifetime of the Associate to whom granted, may be exercised only by such
Associate.
8. SECURITIES ACT OF 1933. Upon issuance of shares of the Company's Common
Stock hereunder, the recipient of such stock shall represent that the shares are
taken for investment and not resale and make such other representations as may
be necessary to qualify the issuance of the shares as exempt from the Securities
Act of 1933 and shall further represent that he or she will not dispose of such
shares in violation of the Securities Act of 1933. The Company reserves the
right to place a legend on any stock certificate issued pursuant to the Plan to
assure compliance with this Section 8. In the event that the Company shall
nevertheless deem it necessary to register under the Securities Act of 1933 or
other applicable statutes any shares with respect to which an option shall have
been exercised, then the Company shall take such action at its own expense
before delivery of such shares. In the event the shares of the Company shall be
listed on any national stock exchange at the time of the exercise of an option
under this Plan, then, whenever required, the Company shall register the shares
with respect to which such option is exercised under the Securities Exchange Act
of 1934, and, whenever required, shall make prompt application for the listing
on such stock exchange.
9. NON-ALIENATION OF BENEFITS. No right or benefit under this Plan shall be
subject to anticipation, alienation, sale, assignment, pledge, encumbrance or
charge, and any attempt to anticipate, alienate, sell, assign, pledge, encumber,
or charge the same shall be void. No right or benefit hereunder shall in any
manner be liable for or subject to the debts, contracts, liabilities, or torts
of the person entitled to such benefits. If any optionee should become bankrupt
or attempt to anticipate, alienate, sell, assign, pledge, encumber, or charge
any right or benefit hereunder, then such right or benefit shall, in the
discretion of the Committee, cease and terminate.
10. AMENDMENT, SUSPENSION, OR TERMINATION OF PLAN. The Board may at any
time suspend or terminate the Plan and may amend it from time to time in such
respects as the Board may deem advisable in order that options granted
thereunder shall conform to any change in the law, or in any other respect which
the Board may deem to be in the best interests of the Company; provided,
however, that without the consent of a majority of the stockholders of the
Company, no such amendment shall, except as specified in Section 6 hereof,
increase the maximum number of shares for which options may be granted under
this Plan. No option may be granted during any suspension of, or after
termination of the Plan. No amendment, suspension of, or termination of this
Plan shall, without the optionee's consent, alter or impair any of the rights or
obligations under any option theretofore granted to her or him under this Plan.
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<PAGE>
11. CONTINUATION OF EMPLOYMENT OR OTHER SERVICES. Neither this Plan nor any
option granted hereunder shall confer upon any Associate any right to continue
to render services or continue to remain in the employ of the Company or any
Subsidiary, or limit in any respect the right of the Company or any Subsidiary
to terminate the employment or services of any Associate at any time.
12. EFFECTIVE DATE. The effective date ("Effective Date") of this Plan
shall be June 18, 1997, provided that if this Plan is not approved by the
holders of a majority of the outstanding shares of Common Stock of the Company
within twelve months of the Effective Date, then the Plan shall terminate and
any options granted hereunder shall be void and of no further force or effect.
13. TERMINATION DATE. Unless this Plan shall have been previously
terminated by the Board, this Plan shall terminate ten years from the Effective
Date, except as to options theretofore granted and outstanding under the Plan at
that date, and no option shall be granted after that date.
A-5
<PAGE>
LEADING EDGE PACKAGING, INC.
This proxy is solicited on behalf of the Board of Directors
The undersigned stockholder of LEADING EDGE PACKAGING, INC. (the "Company")
hereby appoints LIP-BOON SAW and CASEY K. TJANG, as Proxies, each with power to
appoint his substitute, and hereby authorizes them to represent and vote as
designated below, all of the shares of the Company's Common Stock held of record
by the undersigned on June 10, 1997 at the Annual Meeting of Stockholders of the
Company to be held at The Peninsula Hotel, 700 Fifth Avenue, Rejane Room, 3rd
Floor, New York, New York, on July 28, 1997, at 9:00 a.m. (New York time), or at
any adjournment thereof.
(1) Election of Directors:
<TABLE>
<S> <C>
/ / FOR all nominees listed below / / WITHHOLD AUTHORITY
(except as marked to the contrary to vote for any individual
below) nominee listed below.
</TABLE>
LIP-BOON SAW, CASEY K. TJANG, PETER L. COKER, ROBERT B. GOERGEN AND RICHARD
FUNG-GEA WONG
(INSTRUCTION: To withhold authority to vote for any individual nominee,
strike a line through the nominee's name above.)
(2) Proposal to ratify the appointment of Deloitte & Touche LLP as the Company's
independent auditors for the fiscal year ending March 31, 1998.
/ / FOR / / AGAINST / / ABSTAIN
(3) Proposal to adopt the Company's 1997 Associate Stock Option Plan.
/ / FOR / / AGAINST / / ABSTAIN
<PAGE>
(4) In their discretion, the Proxies are authorized to vote upon such other
business as may properly come before the meeting.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED STOCKHOLDER. IF NO DIRECTION IS MADE, THIS PROXY WILL
BE VOTED FOR PROPOSALS 1, 2 AND 3.
DATE:___________________, 1997
______________________________
SIGNATURE
______________________________
SIGNATURE IF HELD JOINTLY
Please sign exactly as name appears hereon. When shares are held by joint
tenants, both should sign. When signing as attorney, as 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 authorized person.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE
ENCLOSED ENVELOPE.
