<PAGE>
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
<TABLE>
<CAPTION>
<S> <C>
Filed by the Registrant /X/
Filed by a Party other than the Registrant / /
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 Rule 14a-11(c) or Rule
14a-12
</TABLE>
<TABLE>
<S> <C>
CELLPOINT INC.
- ------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- ------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement if other than the
Registrant)
</TABLE>
Payment of Filing Fee (Check the appropriate box):
<TABLE>
<S> <C> <C>
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4)
and 0-11.
(1) Title of each class of securities to which transaction
applies:
----------------------------------------------------------
(2) Aggregate number of securities to which transaction
applies:
----------------------------------------------------------
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
----------------------------------------------------------
(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:
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</TABLE>
<PAGE>
CELLPOINT INC.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 30, 1999
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
CELLPOINT INC., a Nevada corporation, will be held at the Star Hotel,
Aniaraplatsen 8, Sollentuna, Sweden on Tuesday, November 30, 1999, at
3:00 P.M., local time, for the following purposes:
1. To elect six directors to serve until their respective successors are
elected and qualified;
2. To consider and vote upon a proposal to approve an amendment to the
Company's Stock Incentive Plan;
3. To ratify the appointment of BDO International AB as the Company's
independent auditors; and
4. To transact such other business as may be properly brought before the
meeting and all adjournments thereof.
Only stockholders of record at the close of business on October 4, 1999,
will be entitled to notice of, and to vote at, the meeting and any adjournment
thereof.
THE BOARD OF DIRECTORS OF CELLPOINT INC. HOPES THAT YOU WILL FIND IT
CONVENIENT TO ATTEND THE MEETING IN PERSON. IN ANY EVENT, PLEASE MARK, SIGN,
DATE AND RETURN THE ENCLOSED PROXY TO MAKE SURE THAT YOUR SHARES ARE REPRESENTED
AT THE MEETING. IF YOU ATTEND THE MEETING, YOU MAY REVOKE THE PROXY YOU HAVE
SENT IN AND VOTE YOUR STOCK PERSONALLY.
By Order of the Board of Directors,
LYNN DUPLESSIS,
Secretary
Sollentuna, Sweden
October 29, 1999
<PAGE>
CELLPOINT INC.
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation by the
Board of Directors of CellPoint Inc., a Nevada corporation (the "Company"), of
proxies to be voted at the Annual Meeting of Stockholders of the Company to be
held at the Star Hotel, Aniaraplatsen 8, Sollentuna, Sweden on Tuesday,
November 30, 1999, at 3:00 P.M., local time, or at any adjournment or
adjournments thereof. Only stockholders of record at the close of business on
October 4, 1999, shall be entitled to notice of, and to vote at, the meeting.
Shares represented by duly executed proxies received by the Company will be
voted in accordance with the instructions contained therein and, in the absence
of specific instructions, will be voted as follows:
- FOR the election as directors of persons who have been nominated by the
Board of Directors;
- FOR the approval of the amendment to the Company's Stock Incentive Plan;
- FOR the ratification of BDO International AB as the Company's independent
auditors; and
- Otherwise in accordance with the judgment of the person or persons voting
the proxies on any other matter that may properly be brought before the
meeting.
At this time, the Board of Directors knows of no other such matters that
will be presented for consideration at the Annual Meeting. The execution of a
proxy will in no way affect a stockholder's right to attend the Annual Meeting
and to vote in person. Any proxy executed and returned by a stockholder in
response to this Proxy Statement may be revoked at any time thereafter except as
to any matter or matters upon which, prior to such revocation, a vote shall have
been cast pursuant to the authority conferred by such proxy.
The election of directors requires a plurality of the votes cast. The
proposal to adopt the amendment to the Company's Stock Incentive Plan requires
the affirmative vote of a majority of the votes cast at the Annual Meeting on
such proposal. The ratification of independent auditors requires the affirmative
vote of a majority of the votes cast thereon. For purposes of determining the
number of votes cast with respect to a particular matter, only those cast "for"
or "against" are included. Shares represented by proxies marked to withhold
authority to vote, and shares represented by proxies that indicate that the
broker or nominee stockholder thereof does not have discretionary authority to
vote them, will be counted only to determine the existence of a quorum at the
Annual Meeting.
This Proxy Statement and the accompanying proxy are being sent on or about
October , 1999, to stockholders entitled to vote at the Annual Meeting of
Stockholders. The cost of solicitation of the Company proxies will be borne by
the Company. In addition to the use of the mails, proxy solicitations may be
made by telephone, telecopier and personal interview by officers, directors and
employees of the Company. However, all proxies granted in response to this Proxy
Statement must be made in writing by signing the enclosed proxy card.
The Company will, upon request, reimburse brokerage houses and persons
holding shares in their names or in the names of their nominees for their
reasonable expenses in sending soliciting material to their principals. The
Company's executive offices are located at Sofielundsvagen 4, S-191 47,
Sollentuna, Sweden. The Company's telephone number is 46-(0)8-544-90000.
<PAGE>
VOTING SECURITIES AND SECURITY OWNERSHIP
Only stockholders of record at the close of business on October 4, 1999,
will be entitled to vote at the Annual Meeting of Stockholders and any
adjournment thereof. At the close of business on October 4, 1999, there were
outstanding 8,265,000 shares of Common Stock, $.001 par value, of the Company.
Each of such shares is entitled to one vote. There was no other class of voting
securities outstanding at that date.
The following table sets forth certain information regarding the beneficial
ownership of the Company's Common Stock as of October 4, 1999, by (i) each
person who is known by the Company to own beneficially more than 5% of the
Company's outstanding Common Stock; (ii) each of the Company's officers and
directors; and (iii) all officers and directors as a group. Unless otherwise
noted below, each such person had sole voting and investment power over such
shares.
<TABLE>
<CAPTION>
NAME AND ADDRESS OF
BENEFICIAL OWNERS AND SHARES OF COMMON STOCK PERCENT OF COMMON STOCK
DIRECTORS AND OFFICERS BENEFICIALLY OWNED BENEFICIALLY OWNED
- ---------------------- ---------------------- -----------------------
<S> <C> <C>
5% BENEFICIAL OWNERS
Bank Ippa & Associates............................. 1,950,000(a) 23.6%
15 Boulevard de la Foire
L-1528 Luxembourg
Novel Electronic Systems & Technologies............ 563,600 6.8%
5 Duke of Edinburgh Ave
Port Louis, Mauritius
DIRECTORS AND EXECUTIVE OFFICERS
Lynn Duplessis..................................... 2,150,000(b) 25.6%
Saatrangsvagen 88
S-182 37
Danderyd, Sweden
Peter Henricsson................................... 2,150,000(c) 25.6%
Saatrangsvagen 88
S-182 37
Danderyd, Sweden
Mats Jonnerhag..................................... 25,390(d) *
Borsinsikt AB
Box 6044
S-192 06 Sollentuna
Sweden
Bengt Nordstrom.................................... 50,000(e) *
Northstream AB
Sjoangsvagen 7
S-19172 Sollentuna
Sweden
Albert van Urk..................................... 75,000(f) *
1 Becker Street
Midrand
Waterfall Park
Ibhubezi House
Howick Close
Johannesburg, South Africa
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
NAME AND ADDRESS OF
BENEFICIAL OWNERS AND SHARES OF COMMON STOCK PERCENT OF COMMON STOCK
DIRECTORS AND OFFICERS BENEFICIALLY OWNED BENEFICIALLY OWNED
- ---------------------- ---------------------- -----------------------
<S> <C> <C>
Kjell Wallman...................................... 25,000(g) *
Brahegatan 39
S-114 37 Stockholm
Sweden
Hadar Cars......................................... 0(h) *
Vitsippsvagen 3
122 36 Saltsjobaden
Sweden
Officers and Directors as a Group
(7 persons)...................................... 2,325,390 27.2%
</TABLE>
- ------------------------
* Less than 1%.
(a) Nominee for Novel Electronics Systems & Technologies.
(b) Includes: (1) options to acquire 75,000 shares, all of which are currently
exercisable, (2) 1,500,000 shares owned by Peter Henricsson, Ms. Duplessis'
husband, and (3) options to acquire 75,000 shares issued to Mr. Henricsson,
all of which are currently exercisable.
(c) Includes: (1) options to acquire 75,000 shares, all of which are currently
exercisable, (2) 500,000 shares owned by Lynn Duplessis, Mr. Henricsson's
wife; and (3) options to acquire 75,000 shares issued to Ms. Duplessis, all
of which are currently exercisable.
(d) Includes (1)16,500 shares held by Borsinsikt AB, of which Mr. Jonnerhag is a
66% stockholder (owning 10,890 shares), and (2) options to acquire 25,000
shares, of which 8,500 are currently exercisable.
(e) Mr. Nordstrom has options to acquire 50,000 shares, of which 35,000 are
currently exercisable.
(f) Mr. van Urk has options to acquire 75,000 shares, all of which are currently
exercisable.
(g) Mr. Wallman has options to acquire 25,000 shares, all of which are currently
exercisable.
(h) Mr. Cars has options to acquire 100,000 shares, none of which is currently
exercisable.
For the purpose of the foregoing table, each of the directors and executive
officers is deemed to be the beneficial owner of shares which may be acquired by
him or her within 60 days through the exercise of options, if any, and such
shares are deemed to be outstanding for the purpose of computing the percentage
of the Company's Common Stock beneficially owned by him or her and by the
directors and executive officers as a group. Such shares, however, are not
deemed to be outstanding for the purpose of computing the percentage of the
Company's Common Stock beneficially owned by any other person.
3
<PAGE>
PROPOSAL NO. 1
ELECTION OF DIRECTORS
MANAGEMENT RECOMMENDS THAT YOU VOTE IN FAVOR OF
THE NOMINEES NAMED TO THE BOARD OF DIRECTORS.
Six directors are to be elected at the Meeting for terms of one year each
and until their successors shall be elected and qualified. It is intended that
votes will be cast pursuant to such proxy for the election of the six persons
whose names are first set forth below unless authority to vote for one or more
of the nominees is withheld by the enclosed proxy, in which case it is intended
that votes will be cast for those nominees, if any, with respect to whom
authority has not been withheld. Each of the nominees is currently serving as a
director of the Company. In the event that any of the nominees should become
unable or unwilling to serve as a director, a contingency which the management
has no reason to expect, it is intended that the proxy be voted, unless
authority is withheld, for the election of such person, if any, as shall be
designated by the Board of Directors.
DIRECTORS WILL BE ELECTED BY A PLURALITY OF THE VOTES CAST AT THE MEETING.
The following table sets forth information concerning each person nominated
to serve as a director of the Company:
LYNN DUPLESSIS, 39, has been Corporate Vice President and Secretary,
Treasurer and director of the Company since its formation in 1997. She has
18 years of experience in the information technology field. Ms. Duplessis has
been employed by Minerva Technology Inc, Vancouver, British Columbia, (1996),
director of industry solutions with The Capstan Group, Vancouver, British
Columbia, (1992-1993), and was employed in marketing, management and systems
engineering by IBM Canada Ltd., Vancouver, British Columbia and Toronto,
Ontario, Canada (1981-1992). She is also a director of CellPoint Systems S.A.
(Pty) Ltd. ("CellPoint SA") and a director of CellPoint Systems AB ("CellPoint
AB"), wholly-owned subsidiaries of the Company. Ms. Duplessis is married to
Peter Henricsson, a director and the President of the Company.
PETER HENRICSSON, 47, has been President, Chief Executive Officer, and
director of the Company since its formation in 1997. He has over 20 years of
experience in executive management, international marketing, venture capital,
consulting and financing, with both multinational corporations and emerging
companies. Mr. Henricsson has been President of Iform Sverige AB of Sweden,
(1996-1997), owner of HIM Inc. (Henricsson International Marketing), Vancouver,
British Columbia, (1991-1996), senior vice president with Allied Environmental,
Vancouver, British Columbia, (1986-1991), and manager at Atlas Copco MCT AB,
Stockholm, Sweden, Hong Kong and Indonesia (1980-1986). He is also a director of
CellPoint SA and Chairman of the Board and a director of CellPoint AB.
Mr. Henricsson is married to Lynn Duplessis, a director and Secretary and
Treasurer of the Company.
MATS JONNERHAG, 45, has been a director of the Company since December 1998.
Mr. Jonnerhag is the founder and majority owner of Borsinsikt AB. He founded
Borsinsikt in 1982 and has more than 20 years of experience with the Swedish
stock market. Borsinsikt publishes a weekly stock market newsletter. Subsidiary
operations include Borsinsikt Broker, which is a brokerage company, and
Borsinsikt BorsData AB, which markets analysis software developed in-house and
other research products.
BENGT NORDSTROM, 42, has been a director of the Company since
September 1998. He was the Chief Technology Officer and Executive Director of
SmarTone Telecommunications Ltd., a cellular network operator in Hong Kong,
until January 1999. He is now the President and Senior Partner of Northstream AB
of Sweden, a GSM consulting company specializing in data over GSM.
Mr. Nordstrom is a member of the Executive Committee of the GSM MoU association
which represents the interests of 369 GSM and satellite network operators around
the world. He was with SmarTone from 1993 to
4
<PAGE>
1998, and was previously with Comviq GSM AB from 1989 - 1993 and with Ericsson
Telecom AB from 1983 - 1989.
ALBERT VAN URK, 32, is co-founder of Wasp International (Pty) Ltd. of South
Africa and has been a director of the Company since January 1999. He is a
director and Vice President of Technology for CellPoint Systems AB. He is also a
director of CellPoint Systems AB and CellPoint SA, wholly-owned subsidiaries of
the Company. He had been the Director of Research and Development of Wasp
International from 1993 to 1999. Mr. van Urk is a director of Wasp SA (Pty) Ltd.
("Wasp SA"). He led the development of the CellPoint GSM positioning technology
and is responsible for research and development activities for all aspects of
the core GSM positioning technology. He continues to be the leader in directing
enhancements and further development of the technology.
KJELL WALLMAN, 66, has been a director of the Company since January 1999. He
had been a partner with Mannheimer Swartling Advokatbyra (law firm) since 1990
and retired in January 1999. He continues to consult to Mannheimer on corporate
law matters. He was also a partner with Carl Swartling Advokatbyra from
1974-1990, and a partner with Weltter & Swartling Advokatbyra from 1968-1974.
Mr. Henricsson and Ms. Duplessis are husband and wife. Otherwise, none of
the directors has any family relationship with any other director or with any
executive officer of the Company.
The Company has no reason to believe that the nominees will be unable or
unwilling to serve as directors, if elected. If, however, the nominees should
decline or be unable to act as directors, the shares represented by the enclosed
proxy will be voted for such other person or persons as may be nominated by the
Board of Directors.
COMMITTEES AND MEETINGS
The Board of Directors has a standing Audit Committee. The Audit Committee
reviews the proposed scope of audit and non-audit services and the fees proposed
to be charged for such services, reviews the reports and receives comments and
recommendations from the Company's internal audit function and the Company's
independent auditors following completion of the annual audit, and reviews with
such auditors and management the Company's accounting policies and the adequacy
of the Company's internal accounting controls. The Audit Committee also deals
with special matters relating to the Company's accounting practices and
financial statements brought to its attention by the Company's internal
auditors, management or the Company's independent auditors. The Company formed
the Audit Committee in September 1999 after which it met one time.
The Board of Directors held four meetings during the Company's fiscal year
ended June 30, 1999. Otherwise, the Board of Directors acted by unanimous
written consent.
COMPENSATION OF DIRECTORS
The directors of the Company do not receive annual compensation for their
services. Messrs. Henricsson and van Urk and Ms. Duplessis are compensated for
their services to the Company or its subsidiaries in their capacities as
respective officers of the Company or its subsidiaries, and not as directors of
the Company.
5
<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table shows compensation for services rendered to the Company
during the fiscal years ended June 30, 1999, 1998 and 1997, respectively, by the
Chief Executive Officer. Each executive officer serves under the authority of
the Board of Directors. No other executive officer of the Company received cash
compensation that exceeded $100,000 during the fiscal years ended June 30, 1999,
1998 and 1997. Therefore, pursuant to Item 402 of Regulation S-B, only
compensation for the Chief Executive Officer is included in the table. Directors
who are also employees of the Company receive no extra compensation for their
service on the Board of Directors of the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
--------------------------------------------- ----------------------------------
AWARDS PAYOUTS
----------------------- --------
SECURITIES
OTHER RESTRICTED UNDERLYING
NAME AND ANNUAL STOCK OPTIONS/ LTIP ALL OTHER
PRINCIPAL FISCAL SALARY BONUS COMPENSATION AWARD(S) SARS(1) PAYOUTS COMPENSATION
POSITION YEAR ($) ($) ($) ($) (#) ($) ($)
- --------- -------- -------- -------- ------------ ---------- ---------- -------- ------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Peter Henricsson,............ 1999 $71,000 -0- -0- -0- -0- -0- -0-
President and CEO 1998 $35,500 -0- -0- -0- 75,000/0 -0- -0-
1997 -0- -0- -0- -0- -0- -0- -0-
</TABLE>
EMPLOYMENT CONTRACTS
The Company has employment agreements with its executive officers: Peter
Henricsson, Lynn Duplessis, Albert van Urk and Hadar Cars.
The Company has an agreement with Mr. Henricsson pursuant to which
Mr. Henricsson now receives a base salary of $108,000 per year. Such employment
agreement is for a term of two years, subject to automatic renewals and certain
rights of termination as specified therein. Mr. Henricsson is entitled to one
year's severance if his employment is terminated in certain circumstances. In
addition, if Mr.Henricsson's employment is terminated within 12 months following
a "change of control", Mr. Henricsson shall be entitled to receive his base
salary for three years following such termination, and all then non-exercisable
options shall become vested.
The Company has an agreement with Ms. Duplessis pursuant to which
Ms. Duplessis receives a base salary of $96,000 per year. Such employment
agreement is for a term of two years, subject to automatic renewals and certain
rights of termination as specified therein. Ms. Duplessis is entitled to one
year's severance if her employment is terminated in certain circumstances. In
addition, if Ms. Duplessis' employment is terminated within 12 months following
a "change of control", Ms. Duplessis shall be entitled to receive her base
salary for three years following such termination, and all then non-exercisable
options shall become vested.
CellPoint SA has an agreement with Mr. van Urk pursuant to which Mr. van Urk
receives a base salary of U.S.$82,000 per year). Such employment agreement is
for a term of two years, subject to automatic renewals and certain rights of
termination as specified therein.
The Company has an agreement with Mr. Cars pursuant to which Mr. Cars
receives a base salary of 65,000 Swedish Crowns per month (approximately
U.S.$95,000 per year). Such employment agreement is for a term of two years,
subject to automatic renewals and certain rights of termination as specified
therein. Mr. Cars is entitled to one year's severance if his employment is
terminated in certain circumstances.
6
<PAGE>
The Company has no set bonus policy. Bonuses may be awarded by the
independent directors of the Board. There is no bonus plan currently under
discussion or in place with the Company. The Board has established a salary
review committee consisting of two independent directors and the Chairman of the
Board, plus an alternate director where the Chairman's compensation is
concerned. This Compensation Committee will review salaries for all staff. The
directors of the Company do not receive salaries for being directors but do have
options in the Company.
OPTION GRANTS IN LAST FISCAL YEAR
STOCK INCENTIVE PLAN
In 1998, the Board of Directors of the Company adopted a stock incentive
plan (the "Plan"). Pursuant to the provisions of the Plan, 1,000,000 shares of
the Company's Common Stock are reserved for issuance upon exercise of options.
The Plan is designed to retain qualified and competent officers, employees, and
directors of the Company.
The Company's Board of Directors, or a committee thereof, shall administer
the Plan and is authorized, in its sole and absolute discretion, to grant
options thereunder to all eligible employees of the Company, including officers
and directors (whether or not employees) of the Company. Options will be granted
pursuant to the provisions of the Plan on such terms and at such prices as
determined by the Company's Board of Directors. The exercise price will not be
lower than the closing price on the date the options are issued, or if such
prices are not available, at the fair market value as determined by the Board of
Directors. Options granted under the Plan will be exercisable after the period
specified in the option agreement. Options granted under the Plan will not be
exercisable after the expiration of ten years from the date of grant. The Plan
will also authorize the Company to make loans to optionees to enable them to
exercise their options. At present, options with respect to all 1,000,000 shares
available under the Plan have been granted and none have been exercised. The
Board of Directors has approved an amendment to increase the number of shares of
Common Stock eligible for option warrants under the Plan by 500,000 shares, and
such amendment is being submitted to the stockholders for their approval in this
Proxy Statement.
OPTION/SAR GRANTS IN FISCAL YEAR ENDED JUNE 30, 1999
<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
- -------------------------------------------------------------------------------------------------------------
NUMBER OF SECURITIES
UNDERLYING
OPTIONS/SARS(1) PERCENT OF TOTAL EXERCISE OR
GRANTED OPTIONS/SARS GRANTED TO BASE PRICE EXPIRATION
NAME (#) EMPLOYEES IN FISCAL YEAR ($/SH) DATE
- ---- -------------------- ------------------------ ----------- ----------
<S> <C> <C> <C> <C>
Peter Henricsson,................ -0- -0- -- --
President and Chief Executive
Officer
</TABLE>
- ------------------------
(1) To date, the Company has issued no SARs.
7
<PAGE>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION VALUES
The following table sets forth as to each person named in the Summary
Compensation Table the specified information with respect to option exercises
during fiscal 1999 and the status of their options at the end of fiscal 1999.
<TABLE>
<CAPTION>
VALUE OF UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY(3)
NUMBER OF OPTIONS/SARS AT FISCAL OPTIONS/SARS AT
SHARES VALUE YEAR-END FISCAL YEAR-END ($)(4)
ACQUIRED ON REALIZED ---------------------------- ----------------------------
NAME EXERCISE ($)(1) EXERCISABLE NONEXERCISABLE EXERCISABLE NONEXERCISABLE
- ---- ----------- -------- ----------- -------------- ----------- --------------
<S> <C> <C> <C> <C> <C> <C>
Peter Henricsson......... -- -- 50,000(2) 25,000(2) $112,500 $56,250
</TABLE>
- ------------------------
(1) The "value realized" represents the difference between the exercise price of
the option shares and the market price of the option shares on the date the
option was exercised. The value realized was determined without considering
any taxes which may become payable in respect of the sale of any such
shares.
(2) Excludes options owned by Lynn Duplessis, Mr. Henricsson's wife.
Ms. Duplessis owns an aggregate of 75,000 options, of which 50,000 options
were exercisable at the end of the fiscal year ended June 30, 1999.
(3) "In-the-money" options are options whose exercise price was less than the
market price of Common Stock at June 30, 1999.
(4) Based on a stock price of $5.00 per share, which was the closing price of a
share of Common Stock reported on the Nasdaq Electronic Bulletin Board on
June 30, 1999.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Since the formation of the Company, Peter Henricsson and Lynn Duplessis,
directors and executive officers of the Company, have made interest-free loans
to the Company to fund its cash needs. During the fiscal year ended June 30,
1997, Mr. Henricsson and Ms. Duplessis paid all of the Company's operating
expenses in the amount of $40,100. During the Company's fiscal year ended
June 30, 1998, they extended loans which ranged from a low of $40,000 to a
maximum of $180,000 outstanding at any one time. A portion of these loans was
also used to fund the initial payment made to Wasp International in connection
with the acquisition of the technology. At June 30, 1998, the outstanding amount
of the indebtedness of the Company to Mr. Henricsson and Ms. Duplessis was
$150,000. The Company repays portions of these loans as and when it has
sufficient excess cash to do so. At no time, has interest been charged on the
outstanding loans. The above loans were repaid in full in November 1998.
In addition, Henricsson and Duplessis have loaned the Company an aggregate
of $300,000 in June and July 1999. Interest of 5% will be charged on the
outstanding balance of this loan.
Upon the organization of the Company in 1997, Mr. Henricsson and
Ms. Duplessis invested $1,500 and $500, respectively, in consideration of which,
the Company issued to them 1,500,000 shares and 500,000 shares of Common Stock,
respectively. These investments were made when the Company had no assets and no
operations.
In connection with the Company's offering of Common Stock at US $4.00 per
share pursuant to Regulation S under the Securities Act, the Company paid a
commission of 5% of the purchase price per share to Mats Jonnerhag, a director
of the Company, and Borsinsikt A.B., a company in which Jonnerhag is a 66%
stockholder. Mr. Jonnerhag and Borsinsikt placed a total of 260,000 shares, and
together they received a total commission of US$52,000.
8
<PAGE>
Effective February 1999, the Company amended and restated its agreements
with Wasp International and Novel Electronics Systems & Technologies ("Novel")
in connection with the Company's acquisition of the CellPoint System technology.
The Company has issued, in May 1998, 1,950,000 shares of the Company's Common
Stock as part of the consideration for the license for the technology, and the
option to acquire the technology, originally granted to the Company in
May 1998. Such shares were applied to the consideration payable to Novel for the
acquisition of the technology by the Company when such agreements were amended
and restated effective as of February 1999. In addition, as part of the
February 1999 agreements, the Company issued to Novel an additional 75,000
shares of Common Stock because, in accordance with the Company's agreement with
Novel, for the twenty trading days immediately prior to September 30, 1999, the
average trading price of the Company's Common Stock was less than $16.00 per
share. If the market value of the foregoing 75,000 shares is less than $750,000
on December 31, 1999, the Company is further obligated to pay to Novel an amount
equal to the difference between the market value of such shares and $750,000.
As part of the February 1999 transaction the Company acquired 10% of the
outstanding equity of Wasp SA. Mr. van Urk, a director of the Company is also a
director and shareholder of Wasp SA. From time to time, the Company may purchase
from Wasp SA certain hardware for the implementation of the CellPoint System. To
date, the amounts paid to Wasp SA for such hardware have not been material. The
Company believes that its equipment purchases from Wasp SA have been and will
continue to be on terms comparable to those available to unaffiliated third
parties.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors, executive officers and persons who own beneficially more than ten
percent of the Company's outstanding Common Stock to file with the SEC initial
reports of beneficial ownership and reports of changes in beneficial ownership
of Common Stock and other securities of the Company on Forms 3, 4 and 5, and to
furnish the Company with copies of all such forms they file. The Company's
directors and officers inadvertently filed their Initial Statements of
Beneficial Ownership of Securities on Form 3 more than ten days after the
Company first became subject to the reporting requirements of the Securities
Exchange Act of 1934.
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PROPOSAL NO. 2
PROPOSAL TO APPROVE THE AMENDMENT TO
THE 1998 STOCK INCENTIVE PLAN
GENERAL
In February 1998, the Board of Directors of the Company established the 1998
Stock Incentive Plan (the "Plan") and authorized 1,000,000 shares of Common
Stock for issuance thereunder. The Plan was approved by the stockholders of the
Company at the annual meeting of stockholders held in January 1999. As of
July 1, 1999, all 1,000,000 shares authorized under the Plan were subject to
options that had been granted. In September 1999, the Board of Directors
approved an amendment to the Plan to increase the number of shares of Common
Stock that may be issued under the Plan by 500,000 shares. This amendment is now
being submitted to the stockholders for approval.
The Board of Directors recommends approval of the amendment. The purpose of
the Plan is to aid the Company in attracting, retaining and motivating
employees, officers and directors of the Company by providing them with
incentives for making significant contributions to the growth and profitability
of the Company. The amendment, if approved, would increase the total number of
shares authorized for issuance under the Plan to 1,500,000. The Board of
Directors believes that the additional share reserve is necessary to permit the
Company to make available competitive long-term incentives for Plan participants
to improve the Company's performance and thereby create stockholder value.
Set forth below is a brief description of the principal features of the
Plan.
Officers, key employees and directors who are also officers or employees of
the Company or its subsidiaries who have been designated as eligible to receive
awards under the Plan who have been so designated are eligible to participate in
the Plan. Key employees are those employees who hold positions of responsibility
or whose performance, in the judgment of the board, can have a significant
effect on the growth and profitability of the Company. The number of persons who
would currently be eligible to participate in the Plan is approximately 34. The
Plan contains similar eligibility requirements, but does not limit participation
therein to directors who are also officers or employees of the Company.
The Plan authorizes the Company to grant stock options, both incentive stock
options (within the meaning of Section 422 of the Internal Revenue Code of 1986,
as amended) and non-qualified stock options, SARs and awards payable in stock,
restricted stock or cash. The Plan provides for these awards, except awards in
cash and, in addition, provides for the award of limited stock appreciation
rights. All of such awards may be granted singly, in combination or in tandem,
or in substitution for awards granted previously under the Plan or any other
plan of the Company. The payment or exercise of any awards, including stock
options, under the Plan may be conditioned on the satisfaction of various
criteria, such as the achievement of specific business objectives, attainment of
growth rates and other comparable measurements of the Company's performance. It
is expected that, while types of awards referred to above may be made from time
to time, the Company will grant principally stock options under the Plan. The
Plan terminates on February 2, 2008.
As of July 1, 1999, there were 1,000,000 options in the aggregate
outstanding under the Plan, which constitutes all of the currently eligible
shares under the Plan. The aggregate number of shares of Common Stock which may
be the subject of awards to any one participant may not exceed 150,000 shares in
any fiscal year of the Company. Shares related to awards (or portions thereof)
that are forfeited, canceled or terminated, expire unexercised, are surrendered
in exchange for other awards, or are settled in cash in lieu of shares or in any
other manner such that shares covered by an award are not and will not be
issued, will be restored to the total number of shares available for issuance
pursuant to awards granted under the Plan.
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The Plan provides that, in the event of a stock split, stock dividend,
combination or reclassification of shares, recapitalization, merger or similar
event, proportional adjustments will be made in (a) the number of shares of the
Company's Common Stock (i) reserved for issuance under the Plan, (ii) available
for options or other awards and available for issuance pursuant to options, or
upon which SARs may be based, for individual participants and (iii) covered by
outstanding awards, (b) the prices related to outstanding awards, and (c) the
appropriate fair market value and other price determinations for such awards. In
addition, equitable adjustments will be made in the event of any other change
affecting the Company's Common Stock or any distribution (other than normal cash
dividends) to stockholders of the Company.
The Plan provides that it shall be administered by the board of directors of
the Company, or a committee of the board. Under the Plan, the board has the sole
authority, among other things, to grant awards; determine the term, conditions
and limitations of awards; establish rules, procedures, regulations and
guidelines relating to the Plan generally and to interpret the Plan and award
agreements entered into pursuant to the Plan.
Generally, a participant in the Plan may exercise or receive payment of an
award only while employed by or associated with the Company or a subsidiary of
the Company, except that, under some circumstances, and subject to restrictions
and limitations imposed by the board, the board may permit exercise by, or
payment to, participants who have retired or become disabled, or who otherwise
have had their employment or association terminated. In addition, if a
participant dies while still employed or associated with the Company or a
subsidiary thereof, the estate, and heirs or beneficiaries of the deceased
participant may, subject to restrictions and limitations imposed by the board,
exercise or receive payment in respect of awards held by the participant at the
time of death. The Plan has similar requirements; however, in the event of the
death, disability or retirement of a participant, such participant or his estate
or representative may exercise options (to the extent they have become
exercisable at the date the participant's association with the Company ended)
for a specified period of time after such date. In general, awards granted under
the Plan are not assignable or transferable by a participant, except under the
limited circumstances contemplated by the Plan.
The exercise price of an option granted under the Plan will be not less than
the fair market value of the Company's Common Stock on the date of grant, as
determined by the board at the time of grant. The Plan contains similar
requirements, except in the event of certain specified circumstances when the
exercise price must be higher. The exercise price of an option must be paid in
full in cash at the time of exercise, or, if permitted by the board, may be paid
in whole or in part by the delivery of shares, the delivery of a promissory note
or by any other means acceptable to the board of directors.
Stock options granted under the Plan may be subject to acceleration of
exercisability or vesting in the event of a change in control of the Company, as
set forth in agreements between the Company and certain of its officers and
directors which provide for certain protections and benefits in the event of a
change in control (as defined in such agreements) or as may otherwise be
determined by the board under and in accordance with the terms and conditions of
the Plan.
The Plan may not, without the approval of the stockholders as set forth
therein, be amended to (i) materially increase the aggregate number of shares of
the Company's Common Stock that may be issued under the Plan as described above,
(ii) materially increase the benefits accruing to participants (except that the
limit on the aggregate number of shares that may be issued to any individual
participant during any fiscal year pursuant to option, or which are used as a
basis of SARs, may not be amended at all without the approval of stockholders)
or (iii) materially modify the eligibility requirements of the Plan. The Plan
may not be changed in such a way as to alter, impair, amend, modify, suspend or
terminate any rights of a participant or any obligations of the Company under
any award theretofore granted in any manner adverse to such participant without
the consent of such participant.
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UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
Upon exercising a SAR or a non-qualified stock option, the participant must
recognize ordinary income in an amount equal to the difference between the
exercise price and the fair market value of the stock on the exercise date. At
such time, the Company will receive a deduction for the same amount (assuming
the applicable requirements of Section 162(m) of the United States Internal
Revenue Code of 1986, as amended, have been met).
With respect to other awards granted under the Plan that are settled in cash
or stock that is either transferable or not subject to a substantial risk of
forfeiture, the participant must recognize ordinary income in an amount equal to
the cash or the fair market value of the shares received, when received. The
Company will receive a deduction for the same amount, provided that, at the time
the income is recognized, the participant either is not a covered employee or
does not have total compensation in excess of $1,000,000 for the year of
recognition (other than compensation that otherwise meets the requirements of
Section 162(m) of the United States Internal Revenue Code of 1986, as amended).
With respect to other awards granted under the Plan that are settled in stock
that is subject to restrictions as to transferability and subject to a
substantial risk of forfeiture, the participant must recognize ordinary income
in an amount equal to the fair market value of the shares received on the date
the shares first become transferable or not subject to a substantial risk of
forfeiture, whichever occurs earlier. At such time, the Company will receive a
deduction for the same amount, subject to the proviso set forth above in this
paragraph.
The tax treatment upon disposition of shares acquired under the Plan will
depend on how long the shares have been held. In the case of shares acquired
through exercise of a stock option, the tax treatment will also depend on
whether or not the shares were acquired by exercising an incentive stock option
rather than a non-qualified stock option. There will be no tax consequences to
the Company upon the disposition of shares acquired under the Plan except that
the Company may receive a deduction in the case of the disposition of shares
acquired under an incentive stock option before the applicable incentive stock
option holding period has been satisfied. The above is the Company's own
interpretation of the situation, and each party should get their own individual
tax counsel for verification as the Company's interpretation does not constitute
tax advice.
RECOMMENDATION
The Board of Directors has adopted, and recommends that the stockholders
approve, the amendment to the Plan increasing the total number of shares that
may be issued under the Plan by 500,000. The Board of Directors of the Company
believes that it is in the best interests of the Company and its stockholders,
in the current competitive business environment, that the amendment to the Plan
be approved, so that the Company can continue to attract, retain and motivate
key employees to make significant contributions to the Company. The Plan, as
amended, will permit certain stock-based incentive compensation to be tailored
to support corporate and business objectives and allow the Company to respond to
competitive compensation practices.
Approval requires the affirmative vote of a majority of the votes cast at
the meeting, in person or by proxy, on such proposal.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE PROPOSAL TO APPROVE THE
AMENDMENT TO THE PLAN.
PROPOSAL NO. 3
RATIFICATION OF INDEPENDENT AUDITORS
The Board of Directors of the Company has appointed the firm of BDO
International AB ("BDO") as its independent auditors for the fiscal year ending
June 30, 2000. While it is not required
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to do so, the Company is submitting the appointment of BDO to the stockholders
for ratification. BDO has been serving the Company in this capacity since
January 1999. BDO has audited the Company's financial statements for the fiscal
years ended June 30, 1999 and June 30, 1998. A representative from BDO will be
present at the Meeting and will be given the opportunity to make a statement if
the representative desires to do so. The representative is expected to be
available to respond to appropriate questions. If the appointment of BDO is not
ratified by the stockholders of the Company, the Board of Directors will
reconsider the appointment of BDO.
The Board of Directors intends that the appointment of the independent
auditors be ratified by a majority of the votes cast.
SUBMISSION OF STOCKHOLDER PROPOSALS
In order for a stockholder proposal to be eligible for inclusion in the
Company's proxy material relating to its 2000 Annual Meeting it must be in
writing and received by the Secretary of the Company prior to July 1, 2000.
Stockholders wishing to bring any matter before a meeting should consult the
Company's Bylaws with respect to any applicable notice or other procedural
requirements.
ANNUAL REPORT
All stockholders of record on October 4, 1999, have been sent, or are
concurrently being sent, a copy of the Company's 1999 Annual Report, which
contains certified financial statements of the Company for the fiscal year ended
June 30, 1999.
ANY PERSON WHO WAS A STOCKHOLDER OF THE COMPANY AT THE CLOSE OF BUSINESS ON
OCTOBER 4, 1999, MAY OBTAIN ADDITIONAL COPIES OF THE COMPANY'S 1999 ANNUAL
REPORT, WITHOUT CHARGE, BY WRITTEN REQUEST TO THE COMPANY, SOFIELUNDSVAGEN 4, S-
191 47, SOLLENTUNA, SWEDEN, ATTENTION: INVESTOR RELATIONS.
ACCOUNTANTS
The Company's independent auditors, selected by the Board of Directors, are
BDO International AB, certified public accountants. BDO International AB has
served as the Company's auditors since January 1999.
Representatives of BDO expected to be present at the Annual Meeting of
Stockholders, and 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 at
the meeting.
OTHER MATTERS
As of the date of this Proxy Statement, the Company knows of no matter other
than those set forth herein which will be presented for consideration at the
Annual Meeting of Stockholders. If any other matter or matters are properly
brought before the meeting or any adjournment thereof, it is the intention of
the person named in the accompanying proxy to vote, or otherwise act, on such
matters in accordance with his judgment.
LYNN DUPLESSIS,
Secretary
Sollentuna, Sweden
October 29, 1999
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CELLPOINT INC.
PROXY--ANNUAL MEETING OF STOCKHOLDERS--NOVEMBER 30, 1999
PROXY SOLICITED BY THE BOARD OF DIRECTORS
The undersigned, a stockholder of CELLPOINT INC., a Nevada corporation (the
"Company"), does hereby appoint PETER HENRICSSON and LYNN DUPLESSIS, and each of
them, the true and lawful attorneys and proxies, with full power of
substitution, for and in the name, place and stead of the undersigned, to vote,
as designated below, all of the shares of stock of the Company which the
undersigned would be entitled to vote if personally present at the Annual
Meeting of Stockholders of the Company to be held at the Star Hotel,
Aniaraplatsen 8, Sollentuna, Sweden, on November 30, 1999, at 3:00 p.m., local
time, and at any adjournment or adjournments thereof.
/X/ Please mark votes as in this example
UNLESS OTHERWISE DIRECTED, THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
RECOMMENDATIONS OF THE BOARD OF DIRECTORS.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE NOMINEES AND "FOR"
PROPOSALS 2 AND 3.
1. ELECTION OF DIRECTORS
NOMINEES: Lynn Duplessis, Peter Henricsson, Mats Jonnerhag, Bengt Nordstrom,
Albert van Urk, Kjell Wallman
/ / FOR ALL NOMINEES / / WITHHELD FROM ALL NOMINEES
For, except vote withheld from the following nominee(s): / / __________________
2. PROPOSAL TO APPROVE THE AMENDMENT TO THE 1998 STOCK INCENTIVE PLAN.
/ / FOR / / AGAINST / / ABSTAIN
3. PROPOSAL TO RATIFY INDEPENDENT AUDITORS.
/ / FOR / / AGAINST / / ABSTAIN
4. TO VOTE WITH DISCRETIONARY AUTHORITY WITH RESPECT TO ALL OTHER MATTERS WHICH
MAY COME BEFORE THE MEETING.
<PAGE>
The undersigned hereby revokes any proxy or proxies heretofore given and
ratifies and confirms that all the proxies appointed hereby, or any of them, or
their substitutes, may lawfully do or cause to be done by virtue hereof. All of
said proxies or their substitutes who shall be present and act at the meeting,
or if only one is present and acts, then that one, shall have and may exercise
all of the powers hereby granted to such proxies. The undersigned hereby
acknowledges receipt of a copy of the Notice of Annual Meeting and Proxy
Statement, both dated October 29, 1999, and a copy of the Annual Report for the
fiscal year ended June 30, 1999.
/ / MARK HERE FOR ADDRESS
CHANGE AND INDICATE CHANGE:
Signature:___________ Date_____
Signature:___________ Date_____
NOTE: Your signature should
appear the same as your name
appears hereon. In signing as
attorney, executor,
administrator, trustee or
guardian, please indicate the
capacity in which signing. When
signing as joint tenants, all
parties in the joint tenancy
must sign. When a proxy is given
by a corporation, it should be
signed by an authorized officer
and the corporate seal affixed.
No postage is required if
returned in the enclosed
envelope and mailed in the
United States.
