CHECKPOINT SYSTEMS INC, S-8, 1999-01-07

CHECKPOINT SYSTEMS INC
S-8, 1999-01-07
COMMUNICATIONS EQUIPMENT, NEC

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As filed with the Securities and Exchange Commission on January 7, 1999.
Registration No. 333-____________
- --------------------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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

FORM S-8

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

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

CHECKPOINT SYSTEMS, INC.
--------------------------------------------------
(Exact name of issuer as specified in its charter)

Pennsylvania 22-1895850
------------------------ ------------------------------------
(State of Incorporation) (I.R.S. Employer Identification No.)

101 Wolf Drive, Thorofare, New Jersey 08086
-------------------------------------------
(Address of Principal Executives Offices)

COMPENSATION OPTION AGREEMENTS BETWEEN CHECKPOINT SYSTEMS, INC
AND GERALD L. WOLKEN DATED AS OF JANUARY 1, 1995 AND OCTOBER 8, 1996

COMPENSATION OPTION AGREEMENT BETWEEN CHECKPOINT SYSTEMS, INC
AND LEWIS C. SHEALY, JR. DATED AS OF APRIL 28, 1998

COMPENSATION OPTION AGREEMENT BETWEEN CHECKPOINT SYSTEMS, INC
AND ERNEST G. LOCKER, JR. DATED AS OF JUNE 11, 1998
--------------------------------------------------------------------
(Full title of the plans)

Kevin P. Dowd, President and
Chief Executive Officer
Checkpoint Systems, Inc.
101 Wolf Drive
P.O. Box 188
Thorofare, NJ 08086
(609) 848-1800
------------------------------------------------------------------------------
(Name, address, including zip code, and telephone number, including area code,
of agent for service)

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

Copies to:
William R. Sasso, Esquire
Stradley, Ronon, Stevens & Young, LLP
2600 One Commerce Square
Philadelphia, PA 19103-7098
(215) 564-8045

<PAGE>

- ----------------------------------------------------------------------------------------------------------------------
CALCULATION OF REGISTRATION FEE
- ----------------------------------------------------------------------------------------------------------------------
Proposed maximum Proposed maximum
Amount to be offering price aggregate offering Amount of
Title of securities to be registered Registered(1) per Share(2) price(4) registration fee
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.10 par value per share 40,000(3) $ 9.8125(3) $914,423 $255
10,000 $26.50
8,000 $17.9063
7,500 $15.1563
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Such additional, indeterminable number of shares that may be issuable by
reason of the anti-dilution provisions of the Compensation Option
Agreements by and between Checkpoint Systems, Inc. ("Registrant") and
Gerald L. Wolken dated as of January 1, 1995 (40,000 shares) and October 8,
1996 (10,000 shares), the Compensation Option Agreement by and between the
Registrant and Lewis C. Shealy, Jr. dated as of April 28, 1998 (8,000
shares) and the Compensation Option Agreement by and between the Registrant
and Ernest G. Locker, Jr. dated as of June 11, 1998 (7,500 shares)
(collectively, the "Option Agreements") are hereby registered.

(2) Pursuant to Rule 457(h)(1), for shares issuable under presently outstanding
options granted under the Option Agreements, the price at which such
options may be exercised has been used to determine the registration fee.

(3) The Compensation Option Agreement with Gerald Wolken, dated January 1,
1995, was granted prior to the Registrant's two-for-one stock split (the
"Stock Split") which was approved by the Board of Directors of the
Registrant on January 4, 1996. The number of shares registered herein and
the respective option price per share represent the terms of such
Compensation Option Agreement following the Stock Split.

(4) Estimated solely for the purpose of determining the registration fee.

<PAGE>

PART II

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3. Incorporation of Documents by Reference.

The documents listed below, previously filed by Checkpoint Systems, Inc.
(the "Registrant") with the Securities and Exchange Commission ("Commission")
pursuant to the Securities Exchange Act of 1934, as amended ("Exchange Act"),
are hereby incorporated by reference in this Registration Statement:

(a) The Registrant's Annual Report on Form 10-K for the fiscal year
ended December 28, 1997;

(b) All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the Registrant's fiscal year covered by the
Registrant's annual report referred to in paragraph (a) above; and

(c) The description of the Registrant's common stock, $.10 par value per
share ("Common Stock"), contained in the Registrant's Registration Statement on
Form 8-A filed with the Commission on October 8, 1993, including any amendment
or report filed by the Registrant for the purpose of updating such description.

All documents filed by the Registrant pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act on or after the date of this Registration
Statement and prior to the filing of a post-effective amendment which indicates
that all securities offered have been sold or which deregisters all securities
then remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be part hereof from the date of filing of such
documents.

Item 4. Description of Securities.

Not applicable.

Item 5. Interests of Named Experts and Counsel.

Not applicable.

Item 6. Indemnification of Directors and Officers.

Section 7.2 of the Registrant's By-laws permits the indemnification of
officers and directors under certain circumstances to the fullest extent that
such indemnification may be permitted by law.

Such rights of indemnification are in addition to, and not in limitation
of, any rights to indemnification to which any officer or director of the
Registrant is entitled under the Business Corporation Law of the Commonwealth of
Pennsylvania (Section 1741 through 1750), which provides for indemnification by
a corporation of its officers and directors under certain circumstances as
stated in the Business Corporation Law and subject to specified limitations set
forth in the Business Corporation Law.

The Registrant also maintains directors' and officers' liability
insurance coverage which insures directors and officers of the Registrant
against certain losses arising from claims made, and for which the

<PAGE>

Registrant has not provided reimbursement, by reason of their being directors
and officers of the Registrant or its subsidiaries.

Item 7. Exemption From Registration Claimed.

Not applicable.

Item 8. Exhibits.

For a list of all exhibits filed or included as part of this
Registration Statement, see "Exhibit Index" filed on page 6 filed herewith.

Item 9. Undertakings.

(a) The Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:

(i) to include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933, as amended ("Securities Act");

(ii) to reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or the most recent
post-effective amendment hereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this Registration
Statement;

(iii) to include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement;

Provided, however, that paragraphs (a)(1)(i) and (1)(ii) hereof
shall not apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed with or
furnished to the Commission by the Registrant pursuant to Section 13 or Section
15(d) of the Exchange Act that are incorporated by reference in this
Registration Statement.

(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at the time shall be deemed to be the initial bona
fide offering thereof.

(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.

(b) The Registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act, each filing of the Registrant's annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.

<PAGE>

(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.

<PAGE>

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Thorofare, State of New Jersey, on the 30th day of
December, 1998.

CHECKPOINT SYSTEMS, INC.

By: /s/ Kevin P. Dowd
-------------------------------------
Kevin P. Dowd
President and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below
constitutes and appoints Kevin P. Dowd and Jeffrey A. Reinhold and each of them,
his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and to file the same, with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents full power and authority to do and
perform each and every act and thing requisite and necessary to be done in and
about the premises, as fully to all intents and purposes as he might or could do
in person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or their substitute or substitutes, may lawfully do or cause to be done
by virtue hereof.

Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Kevin P. Dowd President, Chief Executive Officer December 30, 1998
- ------------------------- and Director
Kevin P. Dowd (Principal Executive Officer)

/s/ Jeffrey A. Reinhold Vice President - Finance, December 30, 1998
- ------------------------- Chief Financial Officer and Treasurer
Jeffrey A. Reinhold

/s/ W. Craig Burns Vice President - Corporate December 30, 1998
- ------------------------- Controller and Chief Accounting
W. Craig Burns Officer

/s/ Robert O. Aders Director December 30, 1998
- -------------------------
Robert O. Aders

/s/ Roger D. Blackwell Director December 30, 1998
- -------------------------
Roger D. Blackwell

/s/ Richard J. Censits Director December 30, 1998
- -------------------------
Richard J. Censits
</TABLE>

<PAGE>

<TABLE>
<S> <C> <C>
/s/ David W. Clark, Jr. Director December 30, 1998
- -------------------------
David W. Clark, Jr.

/s/ Alan R. Hirsig Director December 30, 1998
- -------------------------
Alan R. Hirsig

/s/ William P. Lyons, Jr. Director December 30, 1998
- -------------------------
William P. Lyons, Jr

/s/ Elisa Margaona Director December 30, 1998
- -------------------------
Elisa Margaona

/s/ Raymond R. Martino Director December 30, 1998
- -------------------------
Raymond R. Martino

/s/ Albert E. Wolf Director December 30, 1998
- -------------------------
Albert E. Wolf
</TABLE>

<PAGE>

EXHIBIT INDEX

Exhibit Number Description Location
- -------------- ----------- --------
<S> <C> <C> <C>
4.1 Compensation Option Agreement by and between Registrant Filed herewith.
and Gerald L. Wolken dated as of January 1, 1995.

4.2 Compensation Option Agreement by and between Registrant Filed herewith.
and Gerald L. Wolken dated as of October 8, 1996.

4.3 Compensation Option Agreement by and between Registrant Filed herewith.
and Lewis C. Shealy, Jr. dated as of April 28, 1998.

4.4 Compensation Option Agreement by and between Registrant Filed herewith.
and Ernest G. Locker, Jr. dated as of June 11, 1998.

4.5 Form of Stock Certificate for Common Stock. Incorporated by reference
from Registrant's Registration
Statement on Form 8-A filed on
October 8, 1993.

5.1 Opinion of Stradley, Ronon, Stevens Young, LLP. Filed herewith.

23.1 Consent of Stradley, Ronon, Stevens & Young, LLP. Contained in Exhibit 5.1.

23.2 Consent of PricewaterhouseCoopers , LLP. Filed herewith.

24.1 Power of Attorney. Included on signature page.
</TABLE>

Checkpoint Systems Inc.

COMPENSATION OPTION AGREEMENT

This OPTION AGREEMENT (this "Agreement") is made as of January 1, 1995, by
and between Checkpoint Systems, Inc. ("Checkpoint"), a Pennsylvania corporation
and Gerald L. Wolken ("Wolken"), an individual residing in Ft. Meyers, Florida.

Checkpoint and MLE Enterprises, Inc. have entered into that certain
Consulting Agreement (the "Consulting Agreement") dated January 13, 1995,
pursuant to which MLE Enterprises, Inc. will provide consulting services for
Checkpoint. As part of the consideration for the services to be provided by MLE
Enterprises, Inc. under the Consulting Agreement, Checkpoint has agreed to grant
the options provided by this Agreement to Gerry Wolken.

NOW, THEREFORE, in consideration of the mutual covenants contained herein,
intending to be legally bound, the parties hereto agree as follows:

1. Grant of Option: Checkpoint hereby grants to Wolken the following
Non-Qualified Stock Options (the "Options") to purchase a total of 20,000 shares
(the "Option Shares") of Checkpoint's Common Stock, par value $.10 per share
("Common Stock") at the purchase price of $19.625 (the "Option Price") per share
(being 100% of the fair market value per share of Common Stock on the date
hereof as determined by Checkpoint).

(a) Option Grant Number 1 ("Grant 1") to purchase 10,000 shares of
Checkpoint's Common Stock, par value $.10 per share at the purchase price of
$19.625 per share.

(b) Option Grant Number 2 (Grant 2) to purchase 10,000 shares of
Checkpoint's Common Stock, par value $.10 per share at the purchase price of
$19.625 per share.

All shares of Common Stock authorized to be issued on the exercise of the
Options granted hereunder shall be either authorized but unissued shares or
shares held by Checkpoint in its Treasury.

2. Time of Exercise of Option. The vested and exercisable portion of Grants
1 and 2 as determined in accordance with Section 3, are exercisable for a period
of five (5) years beginning on the date Grants 1 and 2 first become exercisable.
Grant 1 shall become exercisable beginning on June 30, 1995 and Grant 2 shall
become exercisable beginning on June 30, 1996, provided however, that in the
case of each Grant, and as a precondition of exercise, the business plan
referred to in the Consulting Agreement shall have been attained or exceeded for
each respective year. In the event the appropriate business plan is attained, as
set forth in the preceding sentence, thereafter the respective Grant shall be
freely exercisable during the remaining term of the respective Grant shall be
freely exercisable during the remaining term of the Option. In the event the
conditions applicable to Grants 1 and 2 are not attained within the

<PAGE>

respective time periods, Grants 1 and 2 terminate. Notwithstanding anything
contained in this Agreement to the contrary the Options granted herein shall
expire on the earlier of 45 days after the date upon which services to the
Company by MLE Enterprises, Inc. terminate or the dates calculated in accordance
with the first sentence in this Section 2.

3. Vesting. The Options shall be vested on the date hereof, and exercisable
as provided in Section 2.

4. Terms of Payment. Full payment of the Option Price for any Option Shares
with respect to which this Option is exercised shall be made in cash or by
personal or certified check, bank draft or postal or express money order, on the
date notice of exercise of the Option is given by Wolken to Checkpoint.

5. Partial Exercise. The vested portion of this Option may be exercised in
whole or in part, subject to the provisions of this Agreement. Fractional shares
will not be issued.

6. Stock Certificates. Upon the exercise of the Option, appropriate stock
certificates shall be issued to Wolken. The issuance of such stock certificates
shall vest in the holder all rights as a shareholder with respect to the Option
Shares evidenced thereby. Any stock certificate issued hereunder may contain
such securities law or other legends as Checkpoint deems appropriate.

7. Transferability. The Option shall be exercisable only by Wolken or his
permitted assigns heirs, executors or administrators, as the case may be, and
the Option is not assignable or transferable otherwise than upon the prior
written consent of Checkpoint.

8. Adjustments to Number of Shares. In the event of any change in the
shares of Common Stock by reason of any stock dividend, recapitalization,
reorganization merger, consolidation, split-up, combination, or exchange of such
shares at a price substantially below fair market value, or rights offering to
purchase such shares, or of any similar change affecting such shares of Common
Stock, the number and kind of Option Shares subject to this Option and the
Option Price shall be appropriately adjusted to prevent substantial dilution or
enlargement of the rights granted to Wolken hereunder.

9. No Rights As a Stockholder. Wolken shall have no rights as a stockholder
with respect to the Option Shares until the date as of which a stock certificate
is issued pursuant to exercise of the Option. No adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash, other property) or
distributions or rights for which the record date is prior to the date such
stock certificate is issued. Any stock dividends shall result in adjustment of
the number of shares pursuant to Section 8.

<PAGE>

securities laws, unless an exemption therefrom is applicable. Wolken represents
that he is acquiring the Option and will acquire the Option Shares for
investment purposes only and has no present intention of disposing of the Option
or, upon issuance, the Option shares.

11. Notices. All notices hereunder shall be sent by registered or certified
mail, return receipt requested, or by overnight courier guaranteeing next day
delivery to the following addresses:

(i) if to Checkpoint, addressed to:

Checkpoint Systems, Inc.
Attention: General Counsel
101 Wolf Drive
Thorofare, New Jersey 08086

(ii) if to Wolken, addressed to:

Mr. Gerald L. Wolken
c/o MLE Enterprises, Inc.
11595 Kelly Street, Suite 318
Ft Meyers, Florida 33908

12. Binding Effect. This Option Agreement shall be binding upon, and inure
to the benefit of, Checkpoint and its successors and Wolken and his permitted
assigns, heirs, executors and administrators.

13. Integration and Governing Law. This Agreement comprises the entire
understanding between the parties hereto as to the subject matter covered hereby
and shall be construed and interpreted in accordance with the laws of the
Commonwealth of Pennsylvania, without giving effect to the conflict of law
provisions thereof.

IN WITNESS WHEREOF, the undersigned have executed this Option Agreement as
of the date and year first above written.

Gerald L. Wolken Checkpoint Systems, Inc.

/s/ Gerald L. Wolken By: /s/ Kevin P. Dowd
- -------------------- ---------------------------------
(Signature)

Kevin P. Dowd
-------------------------------------
(Printed Name)

President and Chief Executive Officer
-------------------------------------
(Title)

Checkpoint Systems, Inc.

COMPENSATION OPTION AGREEMENT

This OPTION AGREEMENT (this "Agreement") is made as of October 8, 1996, by
and between Checkpoint Systems, Inc. ("Checkpoint"), a Pennsylvania corporation
and Gerald L. Wolken ("Wolken"), an individual residing in Ft. Meyers, Florida.

Checkpoint and MLE Enterprises, Inc. have entered into that certain
Consulting Agreement (the "Consulting Agreement") dated January 13, 1995, and as
renewed by letter dated April 17, 1998, pursuant to which MLE Enterprises, Inc.
will provide consulting services for Checkpoint. As part of the consideration
for the services to be provided by MLE Enterprises, Inc. under the Consulting
Agreement, Checkpoint has agreed to grant the options provided by this Agreement
to Gerry Wolken.

NOW, THEREFORE, in consideration of the mutual covenants contained herein,
intending to be legally bound, the parties hereto agree as follows:

1. Grant of Option: Checkpoint hereby grants to Wolken Non-Qualified Stock
Options (the "Options") to purchase a total 10,000 shares (the "Option Shares")
of Checkpoint's Common Stock, par value $.10 per share ("Common Stock") at the
purchase price of $26.50 (the "Option Price") per share (being 100% of the fair
market value per share of Common Stock on the date hereof as determined by
Checkpoint).

All shares of Common Stock authorized to be issued on the exercise of the
Options granted hereunder shall be either authorized but unissued shares or
shares held by Checkpoint in its Treasury.

2. Time of Exercise of Option. The vested and exercisable portion of
Options granted in accordance with Section 3, are exercisable for a period of
five (5) years beginning on the date the Options first become exercisable.
Options shall become exercisable beginning on April 8, 1996, provided however,
that as a precondition of exercise, the business plan referred to in the
Consulting Agreement shall have been attained or exceeded for each respective
year. In the event the appropriate business plan is attained, as set

<PAGE>

forth in the preceding sentence, thereafter the Options shall be freely
exercisable during the remaining term of the Option. In the event the conditions
applicable are not attained Options shall terminate. Notwithstanding anything
contained in this Agreement to the contrary the Options granted herein shall
expire on the earlier of 45 days after the date upon which services to the
Company by MLE Enterprises, Inc. terminate.

3. Vesting. The Options shall be vested on the date hereof, and exercisable
as provided in Section 2.

5. Partial Exercise. The vested portion of this Option may be exercised in
whole or in part, subject to the provisions of this Agreement. Fractional shares
will not be issued.

<PAGE>

dilution or enlargement of the rights granted to Wolken hereunder.

10. Tax and Securities Laws Matter. Wolken acknowledges and agrees that the
Option has not been, and the Option Shares will not be upon issuance, registered
under the Securities Act of 1933, as amended, or any state securities laws and
may not be offered or sold without registration under the Securities Act of
1933, as amended, and compliance with state securities laws, unless an exemption
therefrom is applicable. Wolken represents that he is acquiring the Option and
will acquire the Option Shares for investment purposes only and has no present
intention of disposing of the Option or, upon issuance, the Option shares.

11. Notices. All notices hereunder shall be sent by registered or certified
mail, return receipt requested, or by overnight courier guaranteeing next day
delivery to the following addresses:

(i) if to Checkpoint addressed to:

Checkpoint Systems, Inc.
Attention: General Counsel
101 Wolf Drive
Thorofare, New Jersey 08086

(ii) if to Wolken, addressed to:

Mr. Gerald L. Wolken
c/o MLE Enterprises, Inc.
11595 Kelly Street, Suite 318
Ft. Meyers, Florida 33908

12. Binding Effect. This Option Agreement shall be binding upon, and inure
to the benefit of, Checkpoint and its

<PAGE>

successors and Wolken and his permitted assigns, heirs, executors and
administrators.

IN WITNESS WHEREOF, the undersigned have executed this Option Agreement as
of the date and year first above written.

Gerald L. Wolken Checkpoint Systems, Inc.

/s/ Gerald L. Wolken By /s/ Kevin P. Dowd
- -------------------- ----------------------------------
(Signature)

Kevin P. Dowd
-------------------------------------
(Printed Name)

President and Chief Executive Officer
-------------------------------------
(Title)

CHECKPOINT SYSTEMS, INC.

COMPENSATION OPTION AGREEMENT

This OPTION AGREEMENT (this "Agreement") is made as of April 28, 1998, by
and between Checkpoint Systems, Inc. ("Checkpoint"), a Pennsylvania corporation
and Lewis C. Shealy, Jr. ("Shealy"), an individual residing at 7044 Pebble Beach
Lane, Seminole, Florida 34647.

Checkpoint and Shealy have entered into that certain Consulting Agreement
(the "Consulting Agreement") dated July 7, 1998, pursuant to which Shealy will
provide consulting services for Checkpoint. As part of the consideration for the
services to be provided by Shealy under the Consulting Agreement, Checkpoint has
agreed to grant the options provided by this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants contained herein,
intending to be legally bound, the parties hereto agree as follows:

1. Grant of Option: Checkpoint hereby grants to Shealy Non-Qualified Stock
Options (the "Options") to purchase a total 8,000 shares (the "Option Shares")
of Checkpoint's Common Stock, par value $.10 per share ("Common Stock") at the
purchase price of $17.9063 (the "Option Price") per share (being 100% of the
fair market value per share of Common Stock on the date hereof as determined by
Checkpoint).

All shares of Common Stock authorized to be issued on the exercise of
the Options granted hereunder shall be either authorized but unissued shares or
shares held by Checkpoint in its Treasury.

2. Time of Exercise of Option. The vested and exercisable portion of
Options granted in accordance with Section 3, are exercisable for a period of
five (5) years beginning on the date the Options first become exercisable.
Options shall become exercisable: (i) 50% or 4,000 shares are exercisable
immediately; (ii) 50% or 4,000 shall be exercisable upon the first anniversary
of the consulting agreement. Notwithstanding anything contained in this
Agreement to the contrary the Options granted herein shall expire on the earlier
of 45 days after the date upon which services to the Company by Shealy
terminate.

<PAGE>

3. Vesting. The Options shall be vested on the date hereof, and exercisable
as provided in Section 2.

5. Partial Exercise. The vested portion of this Option may be exercised in
whole or in part, subject to the provisions of this Agreement. Fractional shares
will not be issued.

6. Stock Certificates. Upon the exercise of the Option, appropriate stock
certificates shall be issued to Shealy. The issuance of such stock certificates
shall vest in the holder all rights as a shareholder with respect to the Option
Shares evidenced thereby. Any stock certificate issued hereunder may contain
such securities law or other legends as Checkpoint deems appropriate.

7. Transferability. The Option shall be exercisable only by Shealy or his
permitted assigns heirs, executors or administrators, as the case may be, and
the Option is not assignable or transferable otherwise than upon the prior
written consent of Checkpoint.

9. No Rights As a Stockholder. Shealy shall have no rights as a stockholder
with respect to the Option Shares until the date as of which a stock certificate
is issued pursuant to exercise of the Option. No adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash, other property) or
distributions or rights for which the

<PAGE>

record date is prior to the date such stock certificate is issued. Any stock
dividends shall result in adjustment of the number of shares pursuant to Section
8.

10. Tax and Securities Laws Matter. Shealy acknowledges and agrees that the
Option has not been, and the Option Shares will not be upon issuance, registered
under the Securities Act of 1933, as amended, or any state securities laws and
may not be offered or sold without registration under the Securities Act of
1933, as amended, and compliance with state securities laws, unless an exemption
therefrom is applicable. Shealy represents that he is acquiring the Option and
will acquire the Option Shares for investment purposes only and has no present
intention of disposing of the Option or, upon issuance, the Option shares.

11. Notices. All notices hereunder shall be sent by registered or certified
mail, return receipt requested, or by overnight courier guaranteeing next day
delivery to the following addresses:

(i) if to Checkpoint, addressed to:

Checkpoint Systems, Inc.
Attention: General Counsel
101 Wolf Drive
Thorofare, New Jersey 08086

(ii) if to Shealy, addressed to:

Mr. Lewis C. Shealy, Jr.
7044 Pebble Beach Lane
Seminole, FL 34647

12. Binding Effect. This Option Agreement shall be binding upon, and inure
to the benefit of, Checkpoint and its successors and Shealy and his permitted
assigns, heirs, executors and administrators.

<PAGE>

IN WITNESS WHEREOF, the undersigned have executed this Option Agreement as
of the date and year first above written.

Lewis C. Shealy, Jr. Checkpoint Systems, Inc.

/s/ Lewis C. Shealy, Jr. BY: /s/ Kevin P. Dowd
- ------------------------ ---------------------------------
(Signature)

Kevin P. Dowd
-------------------------------------
(Printed Name)

President and Chief Executive Officer
-------------------------------------
(Title)

CHECKPOINT SYSTEMS, INC.

COMPENSATION OPTION AGREEMENT

This OPTION AGREEMENT (this "Agreement") is made as of June 11, 1998, by
and between Checkpoint Systems, Inc. ("Checkpoint"), a Pennsylvania corporation
and Ernest G. Locker, Jr. ("Locker"), an individual residing at 845 Clyde,
Downers Grove, Illinois 60516.

Checkpoint and Locker have entered into that certain Consulting Agreement
(the "Consulting Agreement") dated July 7, 1998, pursuant to which Locker will
provide consulting services for Checkpoint. As part of the consideration for the
services to be provided by Locker under the Consulting Agreement, Checkpoint has
agreed to grant the options provided by this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants contained herein,
intending to be legally bound, the parties hereto agree as follows:

1. Grant of Option: Checkpoint hereby grants to Locker Non-Qualified Stock
Options (the "Options") to purchase a total 7,500 shares (the "Option Shares")
of Checkpoint's Common Stock, par value $.10 per share ("Common Stock") at the
purchase price of $15.1563 (the "Option Price") per share (being 100% of the
fair market value per share of Common Stock on the date hereof as determined by
Checkpoint).

All shares of Common Stock authorized to be issued on the exercise of the
Options granted hereunder shall be either authorized but unissued shares or
shares held by Checkpoint in its Treasury.

2. Time of Exercise of Option. The vested and exercisable portion of
Options granted in accordance with Section 3, are exercisable for a period of
five (5) years beginning on the date the Options first become exercisable.
Options shall become exercisable: (i) fifty percent (50%) or 3,750 shares are
exercisable immediately; (ii) fifty percent (50%) or 3,750 shall be exercisable
upon the first anniversary of the consulting agreement. Notwithstanding anything
contained in this Agreement to the contrary the Options granted herein shall
expire on the earlier of ninety (90) days

<PAGE>

after the date upon which services to the Company by Locker terminate.

3. Vesting. The Options shall be vested on the date hereof, and exercisable
as provided in Section 2.

5. Partial Exercise. The vested portion of this Option may be exercised in
whole or in part, subject to the provisions of this Agreement. Fractional shares
will not be issued.

6. Stock Certificates. Upon the exercise of the Option, appropriate stock
certificates shall be issued to Locker. The issuance of such stock certificates
shall vest in the holder all rights as a shareholder with respect to the Option
Shares evidenced thereby. Any stock certificate issued hereunder may contain
such securities law or other legends as Checkpoint deems appropriate.

7. Transferability. The Option shall be exercisable only by Locker or his
permitted assigns heirs, executors or administrators, as the case may be, and
the Option is not assignable or transferable otherwise than upon the prior
written consent of Checkpoint.

9. No Rights As a Stockholder. Locker shall have no rights as a stockholder
with respect to the Option Shares until the date as of which a stock certificate
is issued

<PAGE>

pursuant to exercise of the Option. No adjustment shall be made for dividends
(ordinary or extraordinary, whether in cash, other property) or distributions or
rights for which the record date is prior to the date such stock certificate is
issued. Any stock dividends shall result in adjustment of the number of shares
pursuant to Section 8.

10. Tax and Securities Laws Matter. Locker acknowledges and agrees that the
Option has not been, and the Option Shares will not be upon issuance, registered
under the Securities Act of 1933, as amended, or any state securities laws and
may not be offered or sold without registration under the Securities Act of
1933, as amended, and compliance with state securities laws, unless an exemption
therefrom is applicable. Locker represents that he is acquiring the Option and
will acquire the Option Shares for investment purposes only and has no present
intention of disposing of the Option or, upon issuance, the Option shares.

11. Notices. All notices hereunder shall be sent by registered or certified
mail, return receipt requested, or by overnight courier guaranteeing next day
delivery to the following addresses:

(i) if to Checkpoint, addressed to:

Checkpoint Systems, Inc.
Attention: General Counsel
101 Wolf Drive
Thorofare, New Jersey 08086

(ii) if to Locker, addressed to:

Mr. Ernest G. Locker, Jr.
845 Clyde
Downers Grove, Illinois 60516

12. Binding Effect. This Option Agreement shall be binding upon, and inure
to the benefit of, Checkpoint and its successors and Locker and his permitted
assigns, heirs, executors and administrators.

<PAGE>

Commonwealth of Pennsylvania, without giving effect to the conflict of law
provisions thereof.

IN WITNESS WHEREOF, the undersigned have executed this Option Agreement as
of the date and year first above written.

Ernest G. Locker, Jr. Checkpoint Systems, Inc.

/s/ Ernest G. Locker, Jr. By: /s/ Kevin P. Dowd
- ------------------------- ---------------------------------
(Signature)

Kevin P. Dowd
-------------------------------------
(Printed Name)

President and Chief Executive Officer
-------------------------------------
(Title)

January 7, 1999

Checkpoint Systems, Inc.
101 Wolf Drive
Thorofare, NJ 08086
Attention: Kevin P. Dowd
Chief Executive Officer and President

Re: Registration Statement on Form S-8

Dear Mr. Dowd:

We have acted as counsel to and for Checkpoint Systems, Inc., a
Pennsylvania corporation (the "Company"), in connection with the preparation and
filing with the Securities and Exchange Commission of a registration statement
on Form S-8 (the "Registration Statement"), for the purpose of registering the
issuance of 65,500 shares (the "Shares") of the Company's common stock, $.10 par
value per share (the "Common Stock"), under the Securities Act of 1933, as
amended. The Shares are issuable upon the exercise of certain options (the
"Options") granted to certain consultants of the Company pursuant to the
following agreements: (i) Compensation Option Agreement by and between the
Company and Gerald L. Wolken, dated as of January 1, 1995, (ii) Compensation
Option Agreement by and between the Company and Gerald L. Wolken, dated as of
October 8, 1996, (iii) Compensation Option Agreement by and between the Company
and Lewis C. Shealy, Jr., dated as of April 28, 1998, and (iv) Compensation
Option Agreement by and between the Company and Ernest G. Locker, Jr., dated as
of June 11, 1998 (collectively, the "Option Agreements").

In our capacity as counsel, we have been requested to render the opinions
set forth in this letter and, in connection therewith, we have reviewed the
following documents: (i) the Registration Statement, (ii) the Option Agreements,
(iii) Articles of Incorporation of the Company, certified as true and correct by
the Secretary of the Company, (iv) Bylaws of the Company, certified as true and
correct by the Secretary of the Company, and (v) certain minutes of meetings or
unanimous consents of the Board of Directors of the Company.

In rendering this opinion, we have assumed and relied upon, without
independent investigation, (i) the authenticity, completeness, truth and due
authorization and execution of all documents submitted to us as originals, (ii)
the genuineness of all signatures on all documents submitted to us as originals,
(iii) the conformity to the originals of all documents submitted to us as
certified or photostatic copies, and (iv) the sufficient legal capacity of each
optionee to enter into their respective Option Agreements and exercise their
rights and obligations thereunder.

The law covered by the opinion expressed herein is limited to (a) the
Federal statutes, judicial decisions and rules and regulations of the
governmental agencies of the United States of America and (b) the Pennsylvania
Business Corporation Law of 1988, as amended.

This opinion letter is given only with respect to laws and regulations
presently in effect. We assume no obligation to advise you of any changes in law
or regulation which may hereafter occur,

<PAGE>

whether the same are retroactively or prospectively applied, or to update or
supplement this letter in any fashion to reflect any facts or circumstances
which hereafter come to our attention.

Based upon and subject to the foregoing, we are of the opinion that the
Shares covered by the Options when issued upon proper exercise of the Options
and payment of the exercise price, all in accordance with the terms of the
Option Agreements, will be validly issued, fully paid and nonassessable.

We hereby consent to the use of this opinion as an exhibit to the
Registration Statement and to any reference to our firm in the Registration
Statement as legal counsel who have passed upon the legality of the securities
offered thereby.

Very truly yours,

STRADLEY, RONON, STEVENS & YOUNG, LLP

By: /s/ David E. Beavers
---------------------------------
David E. Beavers, A Partner

We consent to the incorporation by reference in this registration
statement of Checkpoint Systems, Inc. (the "Company") on Form S-8 (No. 333- )
of our report, dated February 13, 1998, on our audit of the consolidated
financial statements and financial statement schedules of the Company as of
December 28, 1997 and December 29, 1996, and for each of the three years in
the periods ended December 27, 1997, December 29, 1996 and December 31, 1995,
which report is included in the Company's Annual Report on Form 10-K for the
year ended December 28, 1997.

/s/ PricewaterhouseCoopers LLP
- ---------------------------------
Philadelphia, Pennsylvania
January 7, 1999