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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. 1)
Filed by the Registrant / /
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))
/ / Definitive Proxy Statement
/x/ Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
WPI Group Inc.
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(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:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
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(5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(4) Date Filed:
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APPENDIX I TO PROXY STATEMENT
WPI GROUP, INC.
1997 EMPLOYEE STOCK PURCHASE PLAN AND STOCK BONUS AWARD PLAN
INTRODUCTION - GENERAL INFORMATION
WPI Group, Inc. (the "Company") has adopted this Employee Stock Purchase Plan
(the "Purchase Plan") and this Stock Bonus Award Plan (the "Bonus Plan";
collectively, the "Plans") for the benefit of eligible employees. The
following description of the Plans are in question and answer format for ease
of reference.
What are the purposes of the Plans? The purpose of the Purchase Plan is to
provide the employees of the Company with an incentive to become shareholders
in the Company. It is believed that employee participation in the ownership
of the business will help to achieve the unity of purpose essential to the
continued growth of the Company and the mutual benefit of its employees and
shareholders. The Bonus Plan has the additional purpose of rewarding
employees of the Company for outstanding contributions to the continued
growth of the Company.
Who administers the Plans? The administrator for both Plans is WPI Group,
Inc. The Company's Vice President - Human Resources maintains all records
relating to the Plans and is the person to whom questions should be directed.
Written inquiries should be directed to the Vice President - Human Resources
at 1155 Elm Street, Manchester, NH 03101 and telephone inquiries should be
directed to (603) 627-3500.
The Purchase Plan is intended to be a qualified stock purchase under the
Internal Revenue Code, but not a welfare benefit arrangement subject to the
provisions of the Employee Retirement Income Security Act of 1974 ("ERISA").
If the Purchase Plan is determined to be a welfare benefit arrangement under
ERISA, it shall be revoked and no longer effective.
The Bonus Plan is not a part of the Purchase Plan and is not intended to be a
qualified stock purchase plan under the Internal Revenue Code or a welfare
benefit arrangement subject to the provisions of the Employee Retirement
Income Security Act of 1974 ("ERISA"). If the Bonus Plan is determined to be
a part of the Purchase Plan, a qualified stock purchase plan, or a welfare
benefit arrangement under ERISA, it shall be revoked and no longer effective.
Both Plans begin on June 1, 1997 and end on May 31, 2007.
The fiscal year for both Plans is the twelve consecutive months beginning on
October 1 of each year.
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ELIGIBILITY AND PARTICIPATION IN THE PLANS
Who is eligible to participate in the Plans? Any full-time employee is
eligible to participate in the Purchase Plan or Bonus Award Plan. However,
Employees of the Company who own (or who would become owners of) 5% of the
Company's outstanding stock are not eligible to make purchases or receive bonus
awards under the Plans.
When does a participant's eligibility terminate? A participant's eligibility
in either Plan ends on the earlier of : (a) the date the Plan terminates; or
(b) the date of termination of the employee's employment with the Company.
Are employees obligated to participate? No. An eligible employee's
participation under either Plan is completely voluntary. With respect to the
Purchase Plan, the decision to invest in Company common stock is solely the
employee's investment decision and should be made with reasonable care and
prudence. The Company can made no representation or warranty regarding the
advisability of investing in its common stock and urges each employee to
consult his or her investment advisor prior to making such purchases.
All participants in the Purchase Plan will have the same rights and
privileges. These rights and privileges are not transferable.
PRODEDURE FOR PURCHASE OF STOCK UNDER THE STOCK PURCHASE PLAN
How are shares purchased under the Purchase Plan? Eligible employees may
purchase shares of the Company's $.01 par value common stock (the "Common
Stock") by submitting the necessary form to the Human Resources Manager
indicating the number of shares that the employee wishes to purchase. The
form must be received by the Human Resources Manager by the close of business
on the day prior to the Purchase Date (defined below). Eligible employees may
purchase no less than ten shares on any Purchase Date, and may purchase no
more than 400 shares under the Purchase Plan during a Plan Year. In addition,
no Employee may purchase more than $25,000 worth of Common Stock in a
calendar year. The Human Resources Manager will calculate the purchase price
for the shares on the Purchase Date, and advise each participating employee
of the price for the number of shares that the employee wishes to purchase.
Payments must be remitted to the Human Resources Manager by cash, money order
or personal check on the next business day following advice of the purchase
price.
When may purchases be made? Purchases can only be made on a quarterly basis,
on Decemebr 15, March 15, June 15 and September 15 of each year (the
"Purchase Dates"). If any Purchase Date falls on Saturday, Sunday or
holiday, the Purchase Date shall be the following business day.
What is the price of the shares purchased? The price of the Common Stock
purchased under the Plan will be ninety-three percent (93%) of the average of
the closing prices of the Common Stock as reported on the National
Association of Securities Dealers Automated Quotation System ("NASDAQ")
during the period of five (5) trading days ending on the Purchase Date or the
five (5) days immediately preceding the Purchase Date, if the Market is
closed on the Purchase Date.
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However, in no event shall the price be less than eighty-five percent (85%)
of the fair market value on the Purchase Date itself or less than the par
value ($.01).
Although participants in the Purchase Plan receive a discount on the price of
the Common Stock purchased under the Purchase Plan and pay no commission for
the purchase of such stock, they also experience the disadvantage of being
unable to select the day on which the Common Stock is purchased. Therefore,
participants cannot time investments under the Purchase Plan to coincide with
fluctuations in the price of the Common Stock.
STOCK BONUS AWARDS UNDER THE STOCK BONUS PLAN
What are stock bonus awards? Bonus awards under the Bonus Plan are grants of
Common Stock to eligible employees. From time to time the Chief Executive
Officer may in his discretion award bonuses of Common Stock to its employees.
Who may receive bonus awards? Bonus awards may be awarded to any employee
that is not an executive officer of the Company or a participant in the
Company's Executive Stock Plan. Bonus awards will be made only in the
discretion of the Chief Executive Officer and may be made to certain
employees who have demonstrated outstanding achievement in their work or to
certain groups of employees who have shown outstanding achievement in their
collective work.
How many shares may be awarded in a bonus award? The number of shares that
are awarded pursuant to a bonus award is at the discretion of the Chief
Executive Officer. The aggregate number of shares that may be awarded by the
Chief Executive Officer pursuant to bonus awards is 20,000 shares during the
term of the Plan, unless additional shares are reserved for such purposes by
the Company's Board of Directors. The Chief Executive Officer may award all
or none of the shares allocated by the Board of Directors for the purpose of
bonus awards, in his complete discretion.
Because bonus stock awards are subject to federal income taxation as
explained below, it is necessary to provide for withholding of federal income
tax and social security tax. That will be done by issuing a smaller number of
shares than the actual award. The number of shares not issued will cover the
federal income tax and social security withholding requirement. No cash will
have to be paid to the Company by an Employee who receives a stock bonus
award.
OTHER INFORMATION
Are certificates issued for shares purchased or awarded under the Plan? Yes.
Participants will receive certificates for their shares of Common Stock
purchased under the Purchase Plan, together with a statement advising the
participant of his or her purchase, as soon as practicable after payment has
been received by the Human Resources Manager. Recipients of stock bonus
awards will also receive certificates as soon as practicable after the award,
together with a statement advising the Employee of the number of shares
awarded, the number of shares retained to cover withholding (explained above)
and the net shares shown on the certificate. The
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certificates should be retained in a secure place. The statements should also
be retained for cost information and tax purposes.
Are there any expenses to participants in connection with purchases or awards
under the Plan? No. There are no brokerage fees on purchases because shares
are purchased from the Company. All costs of administration of the Plan are
paid by the Company. Any withholding requirements for stock bonus awards will
be covered by reducing the number of shares on the certificate.
What is the source of shares purchased under the Plan? Shares purchased or
awarded under the Plans will come from the authorized but unissued shares of
the Common Stock. Shares will not be purchased on the open market.
May the Plans be changed or discontinued? Yes. The Company reserves the
right to amend or terminate each Plan at any time. Participants will be
notified if these Plans are terminated or amended.
What are the federal income tax consequences of participation in the Plans?
With respect to the Purchase Plan, Employees will not recognize income on
receiving the right to participate in and purchase Common Stock through the
Plan. Further, except as described below, employees will not recognize income
on the Purchase Date on the purchase stock. Instead, gain or loss from the
sale or exchange of shares acquired by purchase under the Purchase Plan will
generally be treated as capital gain or loss at the time of such sale or
exchange, provided that the shares are held as capital assets at the time of
sale or exchange and that the sale or exchange occurs no earlier than one
year from the date the shares were purchased. Generally, the basis of the
shares purchased under the Purchase Plan will be the price paid.
If stock purchased under the Purchase Plan is disposed of before the
qualifying date described above then Employees will be treated as having
received ordinary income equal to the difference between the fair market
value of the shares purchased on the Purchase Date and the purchase price.
Recipients of shares as a bonus award under the Bonus Plan will be treated as
having received, on the award date, ordinary income equal to the fair market
value of the shares on that date. Income received by such recipients will be
subject to income tax and social security tax withholding, as explained
above. The amount of the income and the withholdings will be reported on the
recipient's Form W-2 (See "Stock Bonus Awards Under the Stock Bonus Plan -
How Many Shares are Awarded"). The basis of the shares received as an award
will be their fair market value on the award date.
Shares purchased through the Purchase Plan or received through the Bonus Plan
are treated with respect to the sale of shares like shares otherwise
purchased by the participant.
All comments concerning possible federal income tax consequences of
participating in the Plans are based upon the Company's interpretation of
federal tax law as it existed on the date of adoption of the Plan. Since the
federal law is subject to change and each participant's tax
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consequences may be different, the participant is advised to consult his or
her own tax advisor concerning the federal income tax consequences to him or
her.
Who bears risk of market price fluctuations in the Company's Common Stock? A
participant's investment in shares purchased under the Purchase Plan is no
different that his investment in shares of the Company acquired in other
ways. The participant bears the risk of loss and the benefits of gain from
market price changes with respect to all his shares. The Company cannot
guarantee that shares purchased under the Purchase Plan will, at any
particular time, be worth more or less than their purchase price, nor can the
Company guarantee that shares received under the Bonus Plan, will, at any
particular time, be worth more or less than their fair market value at the
time of the award.
What are the responsibilities of the Company under the Plans? In performing
its duties under the Plans, the Company is not liable for any act done in
good faith, or for any good faith omission to act, including, without
limitation, any claim of liability arising out of the prices or timing at
which shares are purchased under the Plans or fluctuations in market value of
shares.
The Plans are not contracts of employment. No part of either Plan shall give
any employee the right to be retained in the Company's service or interfere
with the Company's right to terminate his or her employment at any time, nor
shall it give the Company the right to interfere with the employee's right to
terminate his or her employment at any time.
Who interprets and regulates the Plans? The Company reserves the right to
interpret and regulate the Plans as deemed desirable or necessary in
connection with their respective operations.
