<PAGE>
$$/NOFOLIO
As filed with the Securities and Exchange Commission on April 30, 1999
Registration No. 333-________
________________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
CELLSTAR CORPORATION
----------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 75-2479727
- ---------------------- ---------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1730 Briercroft Court
Carrollton, Texas 75006
- ---------------------------------------- ----------
(Address of Principal Executive Offices) (Zip Code)
CELLSTAR CORPORATION 1993 AMENDED AND RESTATED LONG TERM INCENTIVE PLAN
-----------------------------------------------------------------------
(Full title of the Plan)
ELAINE FLUD RODRIGUEZ
1730 Briercroft Court
Carrollton, Texas 75006
------------------------------------------
(Name and address for agent for service)
(972) 466-5000
----------------------------------------------
(Telephone number, including area code, for agent for service)
With a copy to:
William R. Hayes, III
Haynes and Boone, LLP
901 Main Street, Suite 3100
Dallas, Texas 75202
(214) 651-5000
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------
Proposed Proposed
Maximum Maximum Amount of
Title of Securities Amount Offering Price Aggregate Registration
To Be Registered To Be Registered Per Share Offering Price Fee
- --------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock
$.01 par value $2,000,000 shares(1) $6.31(2) $6,310,000(2) $1,754.18(2)
- --------------------------------------------------------------------------------------------------
</TABLE>
(1) The options registered hereby are part of the CellStar Corporation 1993
Amended and Restated Long-Term Incentive Plan (the "Plan"). On May 19,
1998, the stockholders of the corporation approved an increase in the total
number of shares available for issuance under the Plan from 3,000,000
shares to 4,000,000 shares. The number of shares registered hereby reflect
the Company's 2 for 1 stock split effected in the form of a stock dividend
on June 23, 1998 to stockholders of record as of June 5, 1998.
(2) The offering price per share, the aggregate offering price and the
registration fee are based on the registration of 1 million shares and have
been calculated in accordance with paragraphs (c) and (h) of Rule 457
promulgated under the Securities Act of 1933 on the basis of the average
high and low sale prices for CellStar Corporation's Common Stock reported
on the NASDAQ National Market composite tape on April 27, 1999. No fee
is due with respect to the additional 1 million shares covered hereby as
such shares are deemed to be included herein pursuant to Rule 416(a) of
Regulation C.
1
<PAGE>
THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS
----------------------------------------------
COVERING SECURITIES THAT HAVE BEEN REGISTERED
---------------------------------------------
UNDER THE SECURITIES ACT OF 1933
--------------------------------
NOTICE TO PARTICIPANTS IN THE CELLSTAR CORPORATION
1993 AMENDED AND RESTATED LONG TERM INCENTIVE PLAN
Accompanying this Notice is a summary of the CellStar Corporation 1993
Amended and Restated Long Term Incentive Plan (the "Plan") which you are
encouraged to read carefully.
Certain documents filed by CellStar Corporation (the "Company") with the
Securities and Exchange Commission (the "Commission") are incorporated by
reference into "Item 3. Incorporation of Documents by Reference" of Part II of
the Registration Statement on Form S-8 filed with the Commission, which covers
the securities offered by the accompanying general summary of the Plan. Those
documents, as well as the documents listed below, are available at no charge
upon written or oral request to Elaine Flud Rodriguez, Vice President, Secretary
and General Counsel, at 1730 Briercroft Drive, Carrollton, Texas 75006
(telephone 972-466-5000):
1. The Company's most recent Annual Report on Form 10-K;
2. The Company's most recent Quarterly Report on Form 10-Q;
3. The Company's most recent Proxy Statement to stockholders; and
4. Other reports, proxy statements and communications distributed to the
Company's security holders generally, if the participant requesting
such documents has not otherwise received them.
---------------------------------------------------------------
This Notice is dated April 30, 1999.
<PAGE>
THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS
----------------------------------------------
COVERING SECURITIES THAT HAVE BEEN REGISTERED
---------------------------------------------
UNDER THE SECURITIES ACT OF 1933
--------------------------------
CELLSTAR CORPORATION
--------------------
CELLSTAR CORPORATION
1993 AMENDED AND RESTATED LONG TERM INCENTIVE PLAN
--------------------
2,000,000 SHARES OF COMMON STOCK
(PAR VALUE $.01 PER SHARE)
This Prospectus covers an aggregate of 2,000,000 shares of common stock,
par value $.01 per share (the "Common Stock"), of CellStar Corporation, a
Delaware corporation (the "Company"), which may be issued to holders of options
granted or to be granted to certain employees (including directors who are not
employees) of the Company or its subsidiaries pursuant to the Company's 1993
Amended and Restated Long Term Incentive Plan (the "Plan").
Each offer made pursuant to this Prospectus is made at the price and on the
terms and conditions contained in the stock option agreement executed or to be
executed by each optionee.
This Prospectus may not be used for reoffers or resales of Common Stock
acquired by exercise of any options issued under the Plan. Under existing laws
and regulations, persons who are deemed to be "affiliates" of the Company within
the meaning of Rule 405 promulgated under the Securities Act of 1933, as amended
(the "1933 Act"), may not reoffer or resell any Common Stock acquired upon
exercise of any options unless such reoffers or resales are made either (i)
pursuant to Rule 144 under the 1933 Act, (ii) pursuant to an exemption from the
registration requirements of the 1933 Act, or (iii) by means of a separate
prospectus relating to a registration statement that has been declared effective
under the 1933 Act. See "Resales by Participants" below.
The mailing address of the Company's principal executive office is 1730
Briercroft Court, Carrollton, Texas 75006. The Company's telephone number is
(972) 466-5000. If you desire information about the Plan and its administration
in addition to that contained in this Prospectus, please call or write Elaine
Flud Rodriguez, Vice President, Secretary and General Counsel, at the telephone
number or address listed above.
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED
BY THE SECURITIES AND EXCHANGE COMMISSION NOR HAS THE
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
--------------------
The date of this Prospectus is April 30, 1999.
<PAGE>
No person has been authorized to give any information or to make any
representation in connection with the distribution of Common Stock to which this
Prospectus relates other than those contained herein and, if given or made, such
information or representation must not be relied upon as having been authorized
by the Company. This Prospectus does not constitute an offer or solicitation by
anyone in any state in which such offer or solicitation is not authorized or in
which the person making such offer or solicitation is not qualified to do so or
to anyone to whom it is unlawful to make such offer or solicitation.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "1934 Act") and in accordance therewith files reports
and other information with the Securities and Exchange Commission (the
"Commission"). These reports, proxy and information statements and other
information can be inspected and copied at the offices of the Commission at Room
1024, 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549; Room
1100, Jacob K. Javits Building, 26 Federal Plaza, New York, New York 10278; and
Kluczynski Federal Building, 219 South Dearborn Street, Chicago, Illinois 60604,
or from the Commission's web site at www.sec.gov. Copies of such material may
be obtained upon the payment of prescribed rates from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Judiciary Plaza,
Washington, D.C. 20549.
The Company has filed with the Commission a registration statement (the
"Registration Statement") on Form S-8 under the 1933 Act for the registration of
the securities being offered hereby. This Prospectus does not contain all of
the information set forth in the Registration Statement, certain parts of which
are omitted in accordance with the rules and regulations of the Commission.
-2-
<PAGE>
SUMMARY OF THE CELLSTAR CORPORATION
1993 AMENDED AND RESTATED LONG TERM INCENTIVE PLAN
General
- -------
The CellStar Corporation 1993 Long Term Incentive Plan (as amended, the
"Plan") was adopted by the Board of Directors of the Company, effective as of
December 3, 1993, and was approved by the Company's shareholders on December 3,
1993. The Plan was last amended and restated effective May 19, 1998.
Unless earlier terminated by the Board of Directors, the Plan will
terminate on December 3, 2003, and thereafter no Awards (hereinafter defined)
may be granted thereunder. The Board of Directors may amend or discontinue the
Plan without the approval of the stockholders, subject to certain limitations.
See "Amendment of the Plan" below.
The Plan is not subject to the provisions of the Employee Retirement Income
Security Act of 1974.
The Plan provides for the granting of certain types of Awards which are
intended to qualify for special tax treatment under particular provisions of the
Internal Revenue Code of 1986, as amended (the "Code"), and others which are not
intended to so qualify. See "Certain Federal Income Tax Aspects" below.
Nothing in the Plan or in any Award granted pursuant to the Plan confers
upon any employee any right to continue in the employ of the Company or to
interfere in any way with the right of the Company to terminate the employment
of any person at any time.
The holder of an Award granted pursuant to the Plan does not have any of
the rights or privileges of a stockholder except with respect to shares of
Common Stock which have been actually issued.
The statements contained herein concerning the terms and provisions of the
Plan and the related forms of stock option agreements are summaries and do not
purport to be complete. All such statements are qualified in their entirety by
reference to the full text of the Plan and the related forms of stock option
agreements filed as exhibits to the Registration Statement on Form S-8 filed
with the Commission under the 1933 Act, with respect to the Common Stock offered
hereby.
Purpose and Eligibility
- -----------------------
Any employee, director (including directors who are not employees) or
advisor of the Company or any of its subsidiaries is eligible to participate in
the Plan.
The purposes of the Plan are to attract and retain key employees, non-
employee directors and advisors to the Company and its subsidiaries and to
encourage performance by providing such persons with a proprietary interest in
the Company through the granting of Awards. The Plan is designed to (a)
increase the interest of such persons in the welfare of the Company and its
subsidiaries; (b) furnish an incentive to such persons to continue their service
for the Company and its subsidiaries; and (c) provide a means through which the
Company and its subsidiaries may attract able persons to enter their employ or
serve as advisors.
-3-
<PAGE>
The proceeds from the sale of Common Stock pursuant to the exercise of
options granted under the Plan will be added to the general funds of the Company
and used for general corporate purposes.
Administration of the Plan
- --------------------------
The Plan is currently administered by the Compensation Committee of the
Board of Directors, subject to the power of the Employee Stock Option Committee
to administer Awards of 10,000 shares or less to non-executive employees.
Members of the Committee serve at the will of the Board and may be removed, with
or without cause, from such Committee at any time at the Board's discretion.
Vacancies on either Committee may be filled by appointment by the Board of
Directors. References to the "Committee" in this Prospectus shall mean the
Compensation Committee and/or the Employee Stock Option Committee, as
applicable. The Committee has, subject to the terms of the Plan, the sole
authority to grant Awards thereunder, to construe and interpret the Plan and to
make all other determinations and take any and all actions necessary or
advisable for the administration of the Plan.
Awards
- ------
The Plan provides for the grant of any or all of the following types of
awards (collectively, "Awards"): (i) stock options, including "incentive stock
options" within the meaning of Section 422 of the Code, and non-qualified stock
options; (ii) stock appreciation rights ("SARs"); (iii) restricted stock; and
(iv) cash awards. Awards may be granted singly, in combination, or in tandem,
as determined by the Committee in its discretion. The Committee generally has
the authority to fix the terms and number of Awards to be granted under the
Plan; provided that, no participant may receive during any fiscal year Awards
covering an aggregate of more than 250,000 shares of Common Stock under the
Plan.
Stock options are exercisable to purchase Common Stock of the Company
during a period specified in each option agreement and are exercisable in
installments pursuant to a vesting schedule designated by the Committee. SARs
entitle the holder to receive cash or (in the discretion of the Committee)
shares of Common Stock having a value equal to the appreciation in the fair
market value of the Common Stock underlying the SAR from the date of grant to
the date of exercise. Restricted stock awards give the recipient the right to
receive a specified number of shares of Common Stock, subject to such terms,
conditions and restrictions as the Committee deems appropriate.
Stock Options. An aggregate of 8,000,000 shares of Common Stock are
currently authorized and reserved for issuance under the Plan, subject to
adjustments as are appropriate to reflect any stock dividend, stock split, share
combination, exchange of shares, recapitalization or any increase or decrease in
the number of shares of Common Stock outstanding without receipt of
consideration therefor by the Company. Shares to be optioned and sold may be
made available from either authorized but unissued Common Stock or Common Stock
held by the Company in its treasury. Each non-qualified and incentive stock
option granted under the Plan is required to be evidenced by a stock option
agreement, which designates the stock option as an incentive stock option or a
non-qualified stock option and sets forth the material terms and provisions of
the stock option. If an option granted under the Plan
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<PAGE>
terminates or expires without having been exercised in full, the unexercised
shares subject to that option will be available for further grants of options
under the Plan.
The Plan requires that the purchase price per share under any stock option
or SAR may not be less than 100% of the fair market value of the underlying
shares of Common Stock on the date of grant, or 110% of such value in the case
of incentive stock options granted to any employee owning more than ten percent
of the outstanding capital stock of the Company (a "Ten Percent Owner"). In
addition, the term of any stock option or SAR may not exceed ten years, or five
years in the case of incentive stock options granted to a Ten Percent Owner.
Outstanding options granted under the Plan have ten-year terms. Vesting
schedules for outstanding options range from 100% vesting on the first
anniversary of the date of grant to 25% vesting per year, generally beginning on
the first anniversary of the date of grant. In addition, the vesting of certain
outstanding options has been tied to the achievement of certain specific
performance goals. The aggregate fair market value of Common Stock with respect
to which incentive stock options are exercisable by any participant during any
calendar year may not exceed $100,000.
With respect to any restrictions ("Mandated Restrictions") under the Plan
that are based on the requirements of Rule 16b-3 of the 1934 Act ("Rule 16b-3"),
Sections 422 or 162(m) of the Code, the rules of any exchange upon which the
Company's securities are listed, or any other applicable law, rule or
restriction ("Applicable Law"), to the extent that any such Mandated
Restrictions are no longer required by Applicable Law, the Committee has the
sole discretion and authority to grant Awards under the Plan that are not
subject to such restrictions and/or to waive any such restrictions with respect
to outstanding Awards. Restrictions may include limitations on the right to
transfer or encumber the Award until the expiration of a specified period of
time and forfeiture of the Award upon the occurrence of certain events such as
termination of employment prior to the expiration of a specified period of time.
As of the date hereof, stock options are the only type of Award that have been
granted under the Plan.
The exercise price for any option may be paid as follows: (a) in cash or
by certified check, bank draft, or money order payable to the order of the
Company; (b) with Common Stock (including restricted stock), valued at its fair
market value on the date of exercise; (c) by delivery to the Company or its
designated agent of an executed irrevocable option exercise form together with
irrevocable instructions from the optionee to a broker or dealer, reasonably
acceptable to the Company, to sell certain of the shares of Common Stock
purchased upon exercise of the option or to pledge such shares as collateral for
a loan and promptly deliver to the Company the amount of sale or loan proceeds
necessary to pay such purchase price, and/or (d) in any other form of valid
consideration that is acceptable to the Committee in its sole discretion.
The Company is not required to sell or issue shares of Common Stock under
any stock option if the issuance of such Common Stock would violate any
provision of any law or regulation promulgated by any governmental authority or
any securities exchange or other forum in which shares of Common Stock are
listed and traded (including Section 16 of the 1934 Act); and, as a condition of
any sale or issuance of shares of Common Stock upon exercise of a stock option,
the Committee may require such agreements or undertakings, if any, as the
Committee may deem necessary or advisable to assure compliance with any such law
or regulation.
-5-
<PAGE>
Restricted Stock. The Committee may, in its sole discretion, grant Awards
in the form of restricted stock in accordance with the terms and conditions set
forth in the Plan. Each Award of restricted stock shall confer upon the
participant the right to receive a specified number of shares of Common Stock in
accordance with the terms and conditions of the participant's Award.
The restrictions applicable to any Award of restricted stock will be
determined by the Committee at the time of the Award. The restrictions shall
prohibit the sale, transfer, pledge, assignment or other encumbrance of the
restricted stock and shall provide for possible reversion thereof to the
Company. The restriction period commences on the date of grant and, unless
otherwise established by the Committee, expires upon satisfaction of the
conditions set forth in the Award agreement, which may provide for vesting based
on (i) length of continuous service, (ii) achievement of specific business
objectives, (iii) increases in specified indices, (iv) attainment of specified
growth rates, or (v) any other factor, as determined by the Committee in its
sole discretion. The Committee may, in its sole discretion, remove any or all
of the restrictions whenever it determines that such action is appropriate.
Any other securities or assets (other than ordinary cash dividends) that
are received by a participant with respect to any restricted stock will be
subject to the restrictions in the Award agreement and will be delivered by the
participant to the Company with appropriate documents of transfer.
A participant will have all of the rights of a stockholder of the Company,
including the right to vote the restricted shares, and the right to receive any
dividends thereon. Such rights will be forfeited upon forfeiture of the
restricted stock.
Each participant who is awarded restricted stock will receive a certificate
representing the shares of Common Stock registered in his or her name, but must
be delivered by the participant to the Company together with a stock power
endorsed in blank. Each certificate will bear a legend referring to the terms,
conditions and restrictions applicable to the restricted stock, substantially in
the following form:
"THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
FORFEITURE, RESTRICTIONS ON TRANSFER AND CERTAIN OTHER
TERMS AND CONDITIONS SET FORTH IN THE CELLSTAR CORPORATION
1993 AMENDED AND RESTATED LONG-TERM INCENTIVE PLAN AND IN A
RELATED AWARD AGREEMENT ENTERED INTO BETWEEN THE REGISTERED
OWNER AND CELLSTAR CORPORATION. COPIES OF SUCH PLAN AND
AGREEMENT ARE ON FILE AT THE PRINCIPAL PLACE OF BUSINESS OR
REGISTERED OFFICE OF, AND WILL BE FURNISHED WITHOUT CHARGE
UPON WRITTEN REQUEST BY THE RECORD HOLDER TO, CELLSTAR
CORPORATION, 1730 BRIERCROFT COURT, CARROLLTON, TEXAS
75006.
Upon the lapse of a restriction period and at the instruction of the
participant, the Company will issue a certificate for shares of Common Stock
that do not bear the above legend.
-6-
<PAGE>
Each Award agreement involving the grant of restricted stock shall include
provision to the effect that (i) the participant, by his or her acceptance of
the restricted stock, irrevocably grants to the Company a power of attorney to
transfer any shares forfeited to the Company and agrees to execute any documents
requested by the Company in connection with such forfeiture and transfer, and
(ii) any return or transfer of stock certificates with respect to forfeited
shares of Common Stock will be subject to an order for specific performance by
the Company issued by a court of equity or law.
Any participant who exercises an election under Section 83(b) of the Code
to have his or her receipt of restricted stock taxed currently must immediately
give notice of such election to the Company. Any such election must be made
within 30 days of the grant date and cannot be revoked except with the consent
of the Internal Revenue Service.
Stock Appreciation Rights. The Committee may, in its sole discretion,
grant SARs in accordance with the terms and conditions set forth in the Plan.
Each SAR agreement may contain such additional terms and conditions, not
inconsistent with the terms of the Plan, as are determined by the Committee in
its sole discretion. An SAR may be granted in combination with, in addition to,
or completely independent of, a stock option or any other Award. An SAR shall
entitle a participant to surrender to the Company all or a portion of the SAR in
exchange for an amount equal to the excess of the fair market value of a share
of Common Stock on the date of exercise over the SAR price, multiplied by the
total number of shares of Common Stock for which the SAR has been exercised.
The price of an SAR granted to a participant shall be no less than 100% of the
market price of the Company's Common Stock on the date of grant.
The period during which an SAR may be exercised shall be determined by the
Committee but cannot be more than ten years from the date of grant. An SAR may
be exercised by the delivery of written notice to the Committee at least three
days prior to the intended date of exercise setting forth the number of shares
of Common Stock with respect to which the SAR is to be exercised. At the
discretion of the Committee, the Company may satisfy its payment obligation upon
a participant's exercise of an SAR (a) in cash, (b) in shares of Common Stock
valued at their market value on the date of exercise, or (c) in part with cash
and in part with shares of Common Stock.
If a "reporting participant," or a participant who is subject to the
reporting requirements of Section 16 of the 1934 Act, is to receive cash in
complete or partial settlement of an exercise of an SAR, then certain additional
conditions must also be satisfied, including (i) the Company shall have been
subject to and complied with the reporting requirements of the 1934 Act for at
least one year prior to the exercise of the SAR; (ii) the Company regularly
releases quarterly and annual summary statements of sales and earnings; (iii)
notice of the reporting participant's election to receive cash in full or
partial settlement of the SAR, as well as the exercise of the SAR for cash, must
be made during a specified period unless the exercise is automatic or fixed in
advance under the Plan and is outside the control of the participant; and (iv)
the SAR must be held for six months from the date of grant.
Whenever an incentive stock option and an SAR are granted together and the
exercise of one affects the right to exercise the other, (i) the SAR may not
expire later than the expiration of the underlying incentive stock option; (ii)
the SAR may be for no more than the difference between the exercise price of the
incentive stock option and the market value of the Common Stock subject to the
underlying incentive stock option at the time the SAR is
-7-
<PAGE>
exercised; (iii) the SAR is transferable only when the underlying incentive
stock option is transferable, and under the same conditions; (iv) the SAR may be
exercised only when the underlying incentive stock option is eligible to be
exercised; and (v) the SAR may be exercised only when the exercise price of the
incentive stock option is less than the market value of the underlying Common
Stock.
Cash Awards. The Committee may, in its sole discretion, grant cash awards
in accordance with the terms and conditions set forth in the Plan. The
corresponding Award agreement shall set forth (i) the amount of the cash award,
(ii) the time or times within which such Award may be subject to forfeiture, if
any, (iii) the specific performance goals, or other criteria, if any, as the
Committee may determine, that must be met in order to remove any restrictions
(including vesting) on such Award, and (iv) any other terms, limitations,
restrictions and conditions that are consistent with the Plan.
The Award agreement shall also set forth the vesting period for the cash
award, if any, which shall commence on the date of grant and, unless otherwise
established by the Committee in the Award agreement, shall expire upon
satisfaction of the conditions set forth in the Award Agreement. Such
conditions may provide for vesting based on (i) length of continuous service,
(ii) achievement of specific business objectives, (iii) increases in specified
indices, (iv) attainment of specified growth rates, or (v) other comparable
measurements of Company performance, as may be determined by the Committee in
its sole discretion.
In the sole discretion of the Committee, the Company may satisfy its
obligation under a cash award by the payment of the entire amount, or any
portion thereof, in cash, or by the distribution of that number of shares of
Common Stock, stock options, restricted stock, or any combination thereof,
having an aggregate fair market value (as of the date of payment) equal to the
amount of cash otherwise payable to the participant. If required by Rule 16b-3
at the time of distribution, any shares of Common Stock distributed to a
reporting participant must be held by such participant for at least six months
from the date of distribution.
Transferability of Awards
- -------------------------
Incentive stock options and SARs may not be transferred or assigned other
than by will or the laws of descent and distribution and may be exercised during
the lifetime of the participant only by the participant or the participant's
legally authorized representative. The designation by a participant of a
beneficiary will not constitute a transfer of the stock option. The Committee
may waive or modify any such limitation that is not required for compliance with
Section 422 of the Code.
With respect to Plan participants who are not reporting participants, the
Committee may, in its sole discretion, include such provisions regarding
transferability of the non-qualified stock option or SAR as the Committee, in
its sole discretion, deems appropriate. Non-qualified stock options and SARs
granted to reporting participants may not be transferred or assigned other than
by will or the laws of descent and distribution or pursuant to the terms of a
qualified domestic relations order, as defined by the Code or Title I of ERISA,
and the rules thereunder; however, the Committee may, in its sole discretion,
permit a reporting participant to transfer a non-qualified stock option or SAR
to members of the reporting participant's immediate family, trusts for the
benefit of such immediate family members and partnerships in which such
immediate family members are the only partners; provided that, there cannot be
any
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<PAGE>
consideration for the transfer. The designation by a reporting participant of a
beneficiary will not constitute a transfer of the non-qualified stock option or
SAR.
Change in Control
- -----------------
The Plan provides that, in the event of a Change of Control (defined
below), all unvested stock options and SARs will become fully exercisable, and
all restrictions will lapse with respect to outstanding shares of restricted
stock. "Change of Control" is defined as the occurrence of any of the following
events: (i) any consolidation or merger of the Company in which the Company is
not the continuing or surviving corporation or pursuant to which shares of the
Company's Common Stock would be converted into cash, securities or other
property, other than a merger of the Company in which the holders of the
Company's Common Stock immediately prior to the merger have the same
proportionate ownership of the surviving corporation immediately after the
merger; (ii) any sale, lease, exchange or other transfer (in one transaction or
a series of related transactions) of all or substantially all of the assets of
the Company; (iii) approval by the stockholders of the Company of any plan or
proposal for the liquidation or dissolution of the Company; (iv) the cessation
of control (by virtue of their not constituting a majority of directors) of the
Board by the individuals (the "Continuing Directors") who (x) at the effective
date of the Plan were directors or (y) become directors after the effective date
of the Plan and whose election or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds of the directors then
in office who were directors at the effective date of the Plan or whose election
or nomination for election was previously so approved; (v) in a Title 11
bankruptcy proceeding, the appointment of a trustee or the conversion of a case
involving the Company to a case under Chapter 7; or (vi) the acquisition of
beneficial ownership (within the meaning of Rule 13d-3 under the 1934 Act) of an
aggregate of 15% or more of the voting power of the Company's outstanding voting
securities by any person or persons acting as a group (within the meaning of
Rule 13d-5 under the 1934 Act) who beneficially owned less than 10% of the
voting power of the Company's outstanding voting securities on the effective
date of the Plan, or the acquisition of beneficial ownership of an additional 5%
of the voting power of the Company's outstanding voting securities by any person
or group who beneficially owned at least 10% of the voting power of the
Company's outstanding voting securities on the effective date of the Plan;
provided, however, that, notwithstanding the foregoing, an acquisition will not
constitute a Change of Control under the Plan if the acquiror is (A) Alan H.
Goldfield ("Goldfield"), (B) a trustee or other fiduciary holding securities
under an employee benefit plan of the Company and acting in such capacity, (C) a
corporation owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their ownership of voting securities of
the Company; (D) a person or group meeting the requirements of clauses (i) and
(ii) of Rule 13d-1(b)(1) under the 1934 Act; or (E) any other person whose
acquisition of shares of voting securities is approved in advance by a majority
of the Continuing Directors; and provided further that no Change of Control will
be deemed to have occurred from a transfer of the Company's voting securities by
Goldfield to (1) a member of Goldfield's immediate family (within the meaning of
Rule 16a-1(e) of the 1934 Act) either during Goldfield's lifetime or by will or
the laws of descent and distribution; (2) any trust as to which Goldfield or a
member (or members) of his immediate family is the beneficiary; (3) any trust as
to which Goldfield is the settlor with sole power to revoke; (4) any entity over
which Goldfield has the power, directly or indirectly, to direct or cause the
direction of the management and policies of the entity, whether through the
ownership of voting securities, by contract or otherwise; or (5) any charitable
trust, foundation or corporation under Section 501(c)(3) of the Code that is
funded by Goldfield. To the extent that a participant's employment
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<PAGE>
agreement differs from the Plan with respect to the meaning of "Change of
Control," if such employment agreement has been approved by the Committee of the
Board of Directors, the definition included in such employment agreement will
govern.
Termination of Employment
- -------------------------
The Plan provides that, unless otherwise permitted by the Committee, in its
sole discretion, in the event of termination of a participant's service with the
Company, any stock option or SAR held by such participant may be exercised, to
the extent exercisable on the date of termination, (i) for 12 months after
termination, if termination is due to death or total or permanent disability;
(ii) for three months after termination, if termination is due to retirement;
and (iii) for 30 days after termination, if termination is due to any reason
other than death, disability or retirement; provided that, (a) no option or SAR
may be exercisable beyond its original expiration date; and (b) any unvested
shares of restricted stock held by such participant will be forfeited. If a
participant forfeits unvested shares of restricted stock and has paid
consideration to the Company for such forfeited restricted stock, the Company is
required to repay such consideration to the participant.
Subject to the provisions of the particular Award agreement, and unless
otherwise permitted by the Committee in its sole discretion, upon the
participant's termination of employment for any reason during the restriction
period, any non-vested shares of restricted stock will be forfeited. If a
participant has paid any consideration to the Company for any forfeited
restricted stock, the Company must pay back the consideration to the
participant.
Subject to the provisions of the particular Award agreement, and unless
otherwise permitted by the Committee, in its sole discretion, upon termination
of employment for any reason during a vesting period (if any), the non-vested
portion of a cash award shall be forfeited by the participant. Upon any
forfeiture, all rights of a participant with respect to the forfeited cash award
shall cease and terminate, without any further action or obligation on the part
of the Company.
Adjustments
- -----------
Capital Adjustments. If at any time while the Plan is in effect, or while
unexercised stock options or SARs or unvested shares of restricted stock are
outstanding, there shall be any increase or decrease in the number of issued and
outstanding shares of Common Stock resulting from (i) the declaration or payment
of a stock dividend, (ii) any recapitalization resulting in a stock split-up,
combination, or exchange of shares of Common Stock, or (iii) other increase or
decrease in such shares effected without receipt of consideration by the
Company, then an appropriate adjustment shall be made in (a) the maximum number
of shares of Common Stock available for award under the Plan, (b) the maximum
number of shares of Common Stock awarded to any participant so that the same
proportion of the Company's issued and outstanding shares of Common Stock shall
continue to be subject to being so awarded; (c) the number of shares of Common
Stock subject to outstanding, unexercised stock options or SARs and the option
exercise price or SAR price, so that the same proportion of the Company's issued
and outstanding shares of Common Stock in each instance shall remain subject to
exercise at the same aggregate option exercise price or SAR Price; and (d) the
number of outstanding shares of restricted stock with respect to which
restrictions have not yet lapsed prior to any such change.
-10-
<PAGE>
Except as otherwise expressly provided herein, the issuance by the Company
of shares of its capital stock of any class, or securities convertible into
shares of capital stock of any class, either in connection with direct sale or
upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Company convertible into such shares
or other securities, shall not affect, and no adjustment by reason thereof shall
be made with respect to, (i) the number, or exercise price, of shares of Common
Stock then subject to outstanding stock options or SARs granted under the Plan,
or (ii) the number of outstanding shares of restricted stock.
Upon the occurrence of an event requiring adjustment of the exercise price
or shares issuable upon exercise, the Company is required to mail a copy of its
computation of the adjustment to all optionees, which will be binding on each
optionee.
Reorganization, Merger or Consolidation. In the event of any
reorganization, merger or consolidation pursuant to which the Company is not the
surviving or resulting corporation, there shall be substituted for each share of
Common Stock subject to the unexercised or unvested portions of outstanding
Awards, that number of shares of each class of stock or other securities or that
amount of cash, property, or assets of the surviving or consolidated company
that were distributed or distributable to the stockholders of the Company in
respect to each share of Common Stock held by them. Notwithstanding the
foregoing, however, all such Awards may be canceled by the Board as of the
effective date of any such reorganization, merger, or consolidation, by giving
notice to each holder thereof or his personal representative of its intention to
do so and by permitting the exercise during the thirty (30) day period next
preceding such effective date of any outstanding Stock Options or SARs, whether
or not vested in accordance with their original terms, and by waiving all
restrictions on outstanding shares of restricted stock.
The existence of this Plan and Awards granted hereunder shall not affect in
any way the right or power of the Company or its stockholders to make or
authorize any or all adjustments, recapitalizations, reorganizations, or other
changes in the Company's capital structure and its business, or any merger or
consolidation of the Company, or any issue of bonds, debentures, preferred or
preference stock ranking prior to or otherwise affecting the Common Stock or
the rights of holders thereof (or any rights, options, or warrants to purchase
same), or the dissolution or liquidation of the Company, or any sale or transfer
of all or any part of its assets or business, or any other corporate act or
proceeding, whether of a similar character or otherwise.
Liquidation or Dissolution. In case the Company shall, at any time while
any Award under this Plan shall be in force and remain unexpired, (i) sell all
or substantially all of its property, or (ii) dissolve, liquidate, or wind up
its affairs, then each participant may thereafter receive upon exercise of any
stock option or SAR (in lieu of each share of Common Stock of the Company which
such participant would have been entitled to receive) the same kind and amount
of any securities or assets as may be issuable, distributable, or payable upon
any such sale, dissolution, liquidation, or winding up with respect to each
share of Common Stock of the Company. If the Company shall, at any time prior
to the expiration of any Award, make any partial distribution of its assets, in
the nature of a partial liquidation, whether payable in cash or in kind (but
excluding the distribution of a cash dividend payable out of earned surplus and
designated as such), then in such event the exercise prices then in effect with
respect to any outstanding stock options or SARs shall be reduced, on the
payment date of such distribution, in proportion to the percentage reduction in
the tangible book value of the shares of the
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<PAGE>
Company's Common Stock (determined in accordance with generally accepted
accounting principles) resulting by reason of such distribution.
Amendment of the Plan
- ---------------------
The Plan may be amended or discontinued by the Board, or, if the Board has
specifically delegated this authority to the Committee, by the Committee,
without the approval of the stockholders; provided that, no amendment shall be
made without approval of the stockholders of the Company if such approval is
required under any Applicable Law. In addition, no termination or amendment of
the Plan may, without the consent of the participant to whom any Award has
theretofore been granted, adversely affect the rights of such participant with
respect to such Award.
Awards Issuable in Exchange for Awards Issued by Another Corporation
- --------------------------------------------------------------------
The Committee may, from time to time, determine to issue stock options,
SARs and shares of restricted stock under the Plan in substitution for stock
options, stock appreciation rights or shares of restricted stock held by
employees of a corporation who become or are about to become employees of the
Company or any subsidiary as a result of a merger or consolidation of the
employing corporation with the Company or the acquisition by the Company of
stock of the employing corporation. The terms and conditions of the substitute
Awards may vary from the terms and conditions set forth in this Plan to such
extent as the Committee may deem appropriate to conform, in whole or in part, to
the provisions of the options, stock appreciation rights or shares of restricted
stock in substitution for which they are granted.
Certain Federal Income Tax Aspects
- ----------------------------------
Incentive Stock Options. No taxable income is realized by a participant
and no tax deduction is available to the Company upon either the grant or
exercise of an incentive stock option. If a participant holds the shares
acquired upon the exercise of an incentive stock option for more than one year
after the issuance of the shares upon exercise of the incentive stock option and
more than two years after the date of the grant of the incentive stock option
(the "ISO Holding Period"), the difference between the exercise price and the
amount realized upon the sale of the shares will be treated as a long-term
capital gain or loss and no deduction will be available to the Company. If the
shares are transferred before the expiration of the ISO Holding Period, the
participant will realize ordinary income and the Company will be entitled to a
deduction on the portion of the gain, if any, equal to the difference between
the incentive stock option exercise price and the fair market value of the
shares on the date of exercise or, if less, the difference between the amount
realized on the disposition and the adjusted basis of the stock; provided
however, that the deduction will not be allowed if such amount exceeds the
Deduction Limitation and does not satisfy an exception to the Deduction
Limitation. Any further gain or loss from an arm's-length sale or exchange will
be taxable as a long-term or short-term capital gain or loss, depending upon the
holding period before disposition. Certain special rules apply if an incentive
stock option is exercised by tendering stock.
The difference between the incentive stock option exercise price and the
fair market value, at the time of exercise, of the Common Stock acquired upon
the exercise of an incentive stock option may give rise to alternative minimum
taxable income subject to an alternative
-12-
<PAGE>
minimum tax. Special rules also may apply in certain cases where there are
subsequent sales of shares in disqualifying dispositions and to determine the
basis of the stock for purposes of computing alternative minimum taxable income
on subsequent sale of the shares.
Non-qualified Stock Options. No taxable income generally is realized by
the participant upon the grant of a non-qualified stock option, and no deduction
generally is then available to the Company. Upon exercise of a non-qualified
stock option, the excess of the fair market value of the shares on the date of
exercise over the exercise price will be taxable to the participant as ordinary
income. Such amount will also be deductible by the Company unless such amount
exceeds the Deduction Limitation and does not satisfy an exception to the
Deduction Limitation. The tax basis of shares acquired by the participant will
be the fair market value on the date of exercise. When a participant disposes
of shares acquired upon exercise of a non-qualified stock option, any amount
realized in excess of the fair market value of the shares on the date of
exercise generally will be treated as a capital gain and will be long-term or
short-term, depending on the holding period of the shares. The holding period
commences upon exercise of the non-qualified stock option. If the amount
received is less than such fair market value, the loss will be treated as a
long-term or short-term capital loss, depending on the holding period of the
shares. The exercise of a non-qualified stock option will not trigger the
alternative minimum tax consequences applicable to incentive stock options.
Restricted Stock. Unless a participant otherwise elects to be taxed upon
receipt of shares of restricted stock under the Plan, the participant must
include in his or her taxable income the difference between the fair market
value of the shares and the amount paid, if any, for the shares, as of the first
date the participant's interest in the shares is no longer subject to a
substantial risk of forfeiture or such shares become transferable. A
participant's rights in restricted stock awarded under the Plan are subject to a
substantial risk of forfeiture if the rights to full enjoyment of the shares are
conditioned, directly or indirectly, upon the future performance of substantial
services by the participant. Where shares of restricted stock received under
the Plan are subject to a substantial risk of forfeiture, the participant can
elect to report the difference between the fair market value of the shares on
the date of receipt and the amount paid, if any, for the stock as ordinary
income in the year of receipt. To be effective, the election must be filed with
the Internal Revenue Service within 30 days after the date the shares are
transferred to the participant. The Company is entitled to a federal income tax
deduction equal in amount to the amount includable as compensation in the gross
income of the participant, unless such amount exceeds the Deduction Limitation
and does not satisfy an exception to the Deduction Limitation. The amount of
taxable gain arising from a participant's sale of shares of restricted stock
acquired pursuant to the Plan is equal to the excess of the amount realized on
such sale over the sum of the amount paid, if any, for the stock and the
Compensation element included by the participant in taxable income. For stock
held for more than one year, the participant will realize long-term capital gain
or loss upon disposition.
Stock Appreciation Rights. No taxable income will be realized by a
participant upon the grant of an SAR and no deduction will be available to the
Company. Upon the exercise of the SAR, the participant will realize taxable
income equal to the cash or the fair market value (on the date of exercise) of
the shares, or both, received, and the Company will be entitled to a deduction
unless such amount exceeds the Deduction Limitation and does not satisfy an
exception to the Deduction Limitation. The tax basis in any shares received
will be the fair market value on the date of exercise and, if shares received
are held for more than one year, the participant will realize long-term capital
gain or loss upon disposition.
-13-
<PAGE>
Cash Awards. A participant who receives a cash award will not recognize
any taxable income for federal income tax purposes until the award is no longer
subject to substantial risk of forfeiture. Any cash or shares of Common Stock
received pursuant to the award generally will be treated as compensation income
in the year in which the award becomes no longer subject to substantial risk of
forfeiture. If a cash award is paid in whole or part in shares of Common Stock
and the participant is subject to Section 16(b) of the 1934 Act on the date of
receipt of such shares, the participant generally will not recognize
Compensation income until the expiration of six months from the date of receipt,
unless the participant makes an election under Section 83(b) of the Code to
recognize compensation income on the date of receipt. In each case, the amount
of compensation income will equal the amount of cash and the fair market value
of the shares Common Stock on the date compensation income is recognized. The
Company or one of its subsidiaries generally will be entitled to a compensation
deduction for the amount of compensation income the participant recognizes. Any
stock options received pursuant to such an award will not be subject to taxation
upon the issuance of the option, and no deduction would be available to the
Company at that time. Taxation to the participant (and deductibility for the
Company) will be governed by the same rules as set forth above in the summary
of certain federal income tax consequences relating to non-qualified stock
options.
Other Tax Matters. If unmatured installments of Awards are accelerated as
a result of a Change of Control, any amounts received from the exercise by a
participant of a stock option, the lapse of restrictions on restricted stock or
the deemed satisfaction of conditions of performance-based awards may be
included in determining whether or not a participant has received an "excess
parachute payment" under Section 280G of the Code, which could result in (i) the
imposition of a 20% federal excise tax (in addition to federal income tax)
payable by the participant on certain payments of Common Stock or cash resulting
from such exercise or deemed satisfaction of conditions of performance awards
or, in the case of restricted stock, on all or a portion of the fair market
value of the shares on the date the restrictions lapse and (ii) the loss by the
Company of a compensation deduction.
Resales by Participants
- -----------------------
Common Stock acquired upon exercise of stock options, SARs or restricted
stock granted under the Plan may be resold only in compliance with the
requirements of the 1933 Act and applicable state securities laws.
Persons not deemed to be affiliates of the Company within the meaning of
the 1933 Act may resell shares of Common Stock issued pursuant to the exercise
of stock options, SARs or restricted stock granted under the Plan from time to
time without limitation as to either the quantity of Common Stock sold or the
period during which such Common Stock was held; provided, such Common Stock is
acquired upon exercise of a stock option, SAR or restricted stock while a
registration statement under the 1933 Act covering the issuance of such Common
Stock is in effect.
Persons who are "affiliates" of the Company, as defined in Rule 405
promulgated pursuant to the 1933 Act, may resell shares acquired pursuant to the
Plan only (i) in accordance with the provisions of Rule 144 of the 1933 Act
(except that such affiliate is not required to meet the one-year holding period
requirement of Rule 144 if such Common Stock is acquired upon exercise of a
stock option, SAR or restricted stock while a registration statement covering
the issuance of such shares is in effect) or some other exemption from
registration under the 1933 Act, (ii) pursuant to an exemption from the
registration requirements of the 1933 Act or
-14-
<PAGE>
(iii) pursuant to an effective registration statement. This Prospectus may not
be used in connection with any resales. As defined in Rule 405, an affiliate of
the Company is a person that, directly or indirectly, through one or more
intermediaries, controls, or is controlled by, or is under common control with,
the Company. The determination of whether a person is an affiliate of the
Company is primarily a factual one based upon whether he or she possesses,
directly or indirectly, individually or in concert with others, the power to
direct or cause the direction of the management or policies of the Company,
whether through the ownership of voting stock, by executive position, by
membership on the Board of Directors, by contract or otherwise. Therefore, each
optionee should consult his or her counsel concerning whether he or she is an
affiliate of the Company and therefore subject to restrictions under the 1933
Act on resale of Common Stock acquired pursuant to the Plan.
In order to insure compliance with applicable securities laws, certain
participants may be requested (i) to agree not to dispose of any shares of the
Common Stock received in connection with the exercise of options granted
pursuant to the Plan except under the circumstances described above and (ii) to
consent to the giving of stop-transfer instructions to the Company's transfer
agent with respect to such certificates and to the placing of restrictive
legends on each certificate received.
Section 16(b) of the 1934 Act provides, among other things, that any person
who is a beneficial owner of more than 10% of a class of equity security of a
company registered under the 1934 Act or an officer of director of that company
(as determined by reference to the rules promulgated under Section 16 of the
1934 Act), is liable to the company for any profit realized from any purchase
and sale (or any sale and purchase) of any equity security of such company
within a period of less than six months, irrespective of the intention on the
part of such person in entering into the transaction. Prior to the acquisition
or disposition of any shares of Common Stock (including shares acquired through
participation in the Plan), persons affected should consult with their counsel.
If Common Stock acquired upon the exercise of an incentive stock option
granted pursuant to the Plan is disposed of by a participant prior to the
expiration of either two years from the date of grant of such option, one year
from the transfer of shares to the participant pursuant to the exercise of such
option or in any other disqualifying disposition within the meaning of Section
422 of the Code, the participant in the Plan must notify the Company in writing.
See "Certain Federal Income Tax Aspects - Incentive Stock Options" above.
-15-
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
---------------------------------------
CellStar Corporation (the "Company") hereby incorporates by reference
the following documents filed with the Securities and Exchange Commission (the
"Commission"):
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
November 30, 1998;
(b) The Company's Quarterly Report on Form 10-Q for the three months
ended February 28, 1999;
(c) The Company's Proxy Statement submitted to stockholders dated
March 31, 1999; and
(d) The description of Common Stock included in the Company's Report
on Form 8-A (No. 0-22972) as filed with the Commission on November
26, 1993.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended,
prior to the filing of a post effective amendment that indicates that all
securities offered hereunder have been sold or that deregisters all securities
then remaining unsold, shall be deemed to be incorporated by reference herein
and to be a part hereof from the date such documents are filed.
Item 5. Interests of Named Experts and Counsel.
--------------------------------------
Legal Matters
-------------
The validity of the shares of Common Stock registered hereunder will
be passed upon for the Company by Haynes and Boone, LLP, legal counsel to the
Company.
Experts
-------
The consolidated financial statements and schedule of the Company and
subsidiaries as of November 30, 1998 and 1997, and for each of the years in the
three year period ended November 30, 1998, have been incorporated by reference
herein in reliance upon the report of KPMG LLP, independent certified public
accountants, incorporated by reference herein, and upon the authority of said
firm as experts in accounting and auditing.
II-2
<PAGE>
Item 6. Indemnification of Directors and Officers.
-----------------------------------------
The Company is a Delaware corporation. Section 145 of the Delaware
General Corporation law generally provides that a corporation is empowered to
indemnify any person who is made a party to any threatened, pending or completed
action, suit or proceeding by reason of the fact that is or was a director,
officer, employee or agent of the Company, or is or was serving, at the request
of the Company, in any such capacities of another corporation or other
enterprise, if such director, officer, employee or agent acted in good faith and
in a manner he reasonably believed to be in or not opposed to the best interests
of the Company and, with respect to any criminal action or proceeding, had no
reasonable cause to believe that his conduct was unlawful. This statute
describes in detail the right of the Company to indemnify any such person.
Section 1 of the Eleventh Article of the Amended and Restated Certificate of
Incorporation of the Company (incorporated by reference as Exhibit 4.2 hereto)
and Section 7 of Article VII of the Company's Amended and Restated Bylaws
(incorporated by reference as Exhibit 4.4 hereto) provide generally for
indemnification of all such directors, officers and agents and eliminates the
liability of directors to the fullest extent permitted under the above-
referenced Delaware statute.
For the undertaking with respect to indemnification, see Item 9 below.
Item 8. Exhibits.
--------
Exhibit No. Exhibit
- ---------- -------
4.1 Specimen stock certificate of the Common Stock, par value $.01
per share, of CellStar Corporation, filed as Exhibit 4.1 to the
Company's Annual Report on Form 10-K for the fiscal year ended
November 30, 1995, and incorporated by reference herein.
4.2 Amended and Restated Certificate of Incorporation of CellStar
Corporation, filed as Exhibit 3.1 to the Company's Quarterly
Report on Form 10-Q for the quarter ended August 31, 1995, and
incorporated by reference herein.
4.3 Certificate of Amendment to the Certificate of Incorporation,
filed as Exhibit 3.2 to the Company's quarterly report on Form
10-Q for the quarter ended May 31, 1998, and incorporated herein
by this reference.
4.4 Amended and Restated Bylaws of CellStar Corporation, filed as
Exhibit 3.2 to the Company's Annual Report on Form 10-K for the
fiscal year ended November 30, 1997, and incorporated by
reference herein.
4.5 CellStar Corporation 1993 Amended and Restated Long Term
Incentive Plan, as amended, filed as Exhibit 10.1 to the
Company's quarterly report on Form 10-Q for the quarter ended
May 31, 1998, and incorporated herein by this reference.
II-3
<PAGE>
*4.6 Form of Incentive Stock Option Agreement for use under the Plan.
*4.7 Form of Nonqualified Stock Option Agreement for use under the
Plan.
*5.1 Opinion of Haynes and Boone, LLP, with respect to the validity of
the shares registered hereunder.
*23.1 Consent of KPMG LLP.
*23.2 Consent of Haynes and Boone, LLP (included in Exhibit 5.1).
*24.1 Power of Attorney (included on the signature page of this
registration statement).
___________________
* Filed herewith.
Item 9. Undertakings.
------------
(a) The undersigned 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;
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the registration
statement;
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change to such
information in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
-------- -------
apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in this registration statement.
(2) that, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating
to the securities offered therein, and
II-4
<PAGE>
the offering of such securities at that time shall be deemed
to be an initial bona fide offering thereof; and
(3) to remove from registration by means of a post-effective
amendment any of the securities which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for the
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report under Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 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 Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act of 1933 and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant for 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 that the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
II-5
<PAGE>
SIGNATURES AND POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has caused this registration statement
to be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Carrollton, State of Texas on the 30th day of April, 1999.
CELLSTAR CORPORATION
By: /s/ Richard M. Gozia
-----------------------------
Richard M. Gozia
President
II-6
<PAGE>
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints each of Alan H. Goldfield and Elaine Flud
Rodriguez, 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, execute and file with the Securities and
Exchange Commission and any state securities regulatory board or commission any
documents relating to the proposed issuance and registration of the securities
offered pursuant to this registration statement on Form S-8 under the Securities
Act of 1933, including any amendment relating thereto, with all exhibits and any
and all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys-in-fact and agents, and each of them,
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 to effectuate the
same as fully to all intents and purposes as he might or could do as if
personally present, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or either of them, or their or his or her substitutes, may
lawfully do or cause to be done.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement on Form S-8 has been signed by the following persons on
behalf of the Company on the dates indicated:
/s/ Alan H. Goldfield Chairman of the Board
- ------------------------------ and Chief Executive Officer April 30, 1999
Alan H. Goldfield
/s/ Richard M. Gozia President and Chief
- ------------------------------ Operating Officer April 30, 1999
Richard M. Gozia
/s/ Evelyn Henry Miller Senior Vice President --
- ------------------------------ Finance and Chief April 30, 1999
Evelyn Henry Miller Financial Officer
/s/ James L. Johnson Director April 30, 1999
- ------------------------------
James L. Johnson
/s/ Terry S. Parker Director April 30, 1999
- ------------------------------
Terry S. Parker
/s/ Sheldon I. Stein Director April 30, 1999
- ------------------------------
Sheldon I. Stein
/s/ John T. Stupka Director April 30, 1999
- ------------------------------
John T. Stupka
/s/ J.L. Jackson Director April 30, 1999
- ------------------------------
J.L. Jackson
/s/ Dale V. Kesler Director April 30, 1999
- ------------------------------
Dale V. Kesler
II-7
<PAGE>
EXHIBIT INDEX
-------------
<TABLE>
<CAPTION>
Sequential
Exhibit No. Description Page No.
- ---------- ----------- ----------
<S> <C> <C>
4.1 Specimen stock certificate of the Common Stock, par value $.01
per share, of CellStar Corporation, filed as Exhibit 4.1 to the Company's
Annual Report on Form 10-K for the fiscal year ended November 30,
1995, and incorporated by reference herein.
4.2 Amended and Restated Certificate of Incorporation of CellStar Corporation,
filed as Exhibit 3.1 to the Company's Quarterly Report on Form 10-Q for
the quarter ended August 31, 1995, and incorporated by reference herein.
4.3 Certificate of Amendment to the Certificate of Incorporation, filed as
Exhibit 3.2 to the Company's quarterly report on Form 10-Q for the quarter
ended May 31, 1998, and incorporated herein by this reference.
4.4 Amended and Restated Bylaws of CellStar Corporation, filed as Exhibit 3.2
to the Company's Annual Report on Form 10-K for the fiscal year ended
November 30, 1997, and incorporated by reference herein.
4.5 CellStar Corporation 1993 Amended and Restated Long Term Incentive
Plan, as amended, filed as Exhibit 10.1 to the Company's quarterly report
on Form 10-Q for the quarter ended May 31, 1998, and incorporated herein
by this reference.
*4.6 Form of Incentive Stock Option Agreement for use under the Plan.
*4.7 Form of Nonqualified Stock Option Agreement for use under the plan.
*5.1 Opinion of Haynes and Boone, LLP, with respect to the validity of the shares
registered hereunder.
*23.1 Consent of KPMG LLP.
*23.2 Consent of Haynes and Boone, LLP (included in Exhibit 5.1).
*24.1 Power of Attorney (included on the signature page of this registration
statement).
</TABLE>
__________________________
* Filed herewith.
<PAGE>
EXHIBIT 4.6
INCENTIVE STOCK OPTION AGREEMENT
CELLSTAR CORPORATION
1993 AMENDED AND RESTATED LONG-TERM INCENTIVE PLAN
This Stock Option Agreement (this "Agreement") is entered into by and
between CellStar Corporation, a Delaware corporation (the "Company"), and
__________________ (the "Optionee"), an employee of the Company. The Company
and the Optionee agree as follows:
1. Grant of Option. Pursuant to the CellStar Corporation 1993 Amended
---------------
and Restated Long-Term Incentive Plan (the "Plan") and a duly adopted resolution
of the Committee, the Company grants to the Optionee an option (the "Stock
Option") to purchase from the Company a total of ______ shares (the "Optioned
Shares") of Common Stock of the Company at $________ per share (being the Fair
Market Value per share of Common Stock on the Date of Grant), in the amounts,
during the periods, and upon the terms and conditions set forth in this
Agreement and in the Plan. The Date of Grant of this Stock Option is
_________________. This Stock Option is intended to qualify as an "incentive
stock option" within the meaning of Section 422 of the Code.
2. Interpretation. This Stock Option and its exercise are subject to the
--------------
terms and conditions of the Plan, which terms and conditions are incorporated
herein by reference; however, unless specifically permitted by the Committee,
the terms of the Plan shall not be considered an enlargement of any benefits
under this Agreement. Capitalized terms used and not otherwise defined herein
shall have the meanings assigned to them in the Plan. This Stock Option is
subject to any rules promulgated pursuant to the Plan by the Board or the
Committee and communicated to the Optionee in writing.
3. Vesting; Time of Exercise. Except as specifically provided in this
-------------------------
Agreement and subject to certain restrictions and conditions set forth in the
Plan, this Stock Option may be exercised, in whole or in part, in accordance
with the following schedule:
Percentage
Exercisable Period
----------- ------
0% Immediately
25% On and after the first anniversary of the Date of Grant
50% On and after the second anniversary of the Date of Grant
75% On and after the third anniversary of the Date of Grant
100% On and after the fourth anniversary of the Date of Grant
The unexercised portion of this Stock Option from one annual period may be
carried over to a subsequent annual period or periods, and the right of the
Optionee to exercise the Stock Option
<PAGE>
as to such unexercised portion shall continue for the entire term. In no event
may the Stock Option be exercised in whole or in part, however, after the
expiration of the term set forth in Section 4 below.
4. Term; Rights in Event of Termination of Employment. This Stock
--------------------------------------------------
Option, and all unexercised Optioned Shares granted to the Optionee hereunder,
will terminate and be forfeited at the first of the following to occur:
(a) 5 p.m. on _________________;
(b) 5 p.m. on the date which is twelve (12) months following the
Optionee's termination of employment due to death or Total and Permanent
Disability;
(c) 5 p.m. on the date which is three (3) months following the
Optionee's termination of employment due to Retirement; or
(d) 5 p.m. on the 30th day after the day of any other termination of
employment.
In the event of the Optionee's termination of employment under subsections
(b),(c) or (d) above, the Stock Option will be exercisable, for the periods
indicated, only to the extent that it has vested (pursuant to Section 3 above)
as of the date of termination of employment.
5. Who May Exercise. Subject to the terms and conditions set forth in
----------------
Sections 3 and 4 above and the following sentence, during the lifetime of the
Optionee, this Stock Option may be exercised only by the Optionee. If the
Optionee's employment terminates as a result of death or Total and Permanent
Disability prior to the termination date specified in Section 4(a) hereof, the
following persons may exercise this Stock Option (to the extent it is
exercisable on the date of termination of employment) on behalf of the Optionee
at any time prior to the earlier of the dates specified in Sections 4(a) or (b)
hereof: (i) if the Optionee's employment is terminated due to Total and
Permanent Disability, the legal representative of the Optionee; or (ii) if the
Optionee dies, the personal representative of his estate, or the person who
acquires the right to exercise this Stock Option by bequest or inheritance or by
reason of the death of the Optionee; provided that this Stock Option shall
remain subject to the other terms of this Agreement, the Plan, and applicable
laws, rules, and regulations.
6. Restrictions. This Stock Option may be exercised only with respect to
------------
full shares, and no fractional share of stock shall be issued.
7. Manner of Exercise. Subject to such administrative regulations as the
------------------
Board or the Committee may from time to time adopt, this Stock Option may be
exercised by the delivery to the Company of (i) written notice setting forth the
number of shares of Common Stock with respect to which the Stock Option is to be
exercised and the date of exercise thereof (the "Exercise Date"), which shall be
at least three (3) days after giving such notice, unless an earlier time shall
have been mutually agreed upon; and (ii) consideration with a value equal to the
total Option Exercise Price
-2-
<PAGE>
for the shares to be purchased, payable as follows: (a) cash, certified check,
bank draft, or money order payable to the order of the Company, (b) Common Stock
(including Restricted Stock), valued at its Fair Market Value on the Exercise
Date, (c) by delivery (including by FAX) to the Company or its designated agent
of an executed irrevocable option exercise form together with irrevocable
instructions from the Optionee to a broker or dealer, reasonably acceptable to
the Company, to sell certain of the shares of Common Stock purchased upon
exercise of the Stock Option or to pledge such shares as collateral for a loan
and promptly deliver to the Company the amount of sale or loan proceeds
necessary to pay such Option Exercise Price and/or (d) in any other form of
valid consideration that is acceptable to the Committee in its sole discretion;
provided that, with respect to a cashless exercise of the Stock Option (in
accordance with clause (c) above), the Stock Option will be deemed exercised on
the date of sale of the shares of Common Stock received upon exercise. In the
event that shares of Restricted Stock are tendered as consideration for the
exercise of the Stock Option, a number of shares of Common Stock issued upon the
exercise of the Stock Option, equal to the number of shares of Restricted Stock
used as consideration therefor, shall be subject to the same restrictions as the
Restricted Stock so submitted.
Upon payment of all amounts due from the Optionee, the Company shall cause
certificates for the Optioned Shares then being purchased to be delivered to the
Optionee (or the person exercising the Optionee's Stock Option in the event of
his death) at its principal business office (or other mutually agreed upon
location) within ten (10) business days after the Exercise Date. The obligation
of the Company to deliver shares of Common Stock shall, however, be subject to
the condition that if at any time the Board or the Committee shall determine in
its discretion that the listing, registration, or qualification of the Stock
Option or the Optioned Shares upon any securities exchange or under any state or
federal law, or the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of, or in connection with, the Stock
Option or the issuance or purchase of shares of Common Stock thereunder, then
the Stock Option may not be exercised in whole or in part unless such listing,
registration, qualification, consent, or approval shall have been effected or
obtained free of any conditions not acceptable to the Committee.
If the Optionee fails to pay for any of the Optioned Shares specified in
such notice or fails to accept delivery thereof, then the Optionee's right to
purchase such Optioned Shares may be terminated by the Company.
8. Disqualifying Disposition. In the event that Common Stock acquired
-------------------------
upon exercise of this Stock Option is disposed of by the Optionee prior to the
expiration of either two years from the Date of Grant of such Stock Option or
one year from the transfer of shares to the Optionee pursuant to the exercise of
such Stock Option, such Optionee shall notify the Company in writing within
thirty (30) days after such disposition of the date and terms of such
disposition.
9 Non-Assignability. This Stock Option is not assignable or
-----------------
transferable by the Optionee except by will or by the laws of descent and
distribution.
10. Rights as Stockholder. The Optionee will have no rights as a
---------------------
stockholder with respect to any shares covered by this Stock Option until the
issuance of a certificate or certificates to the
-3-
<PAGE>
Optionee for the shares. Except as otherwise provided in Section 11 hereof, no
adjustment shall be made for dividends or other rights for which the record date
is prior to the issuance of such certificate or certificates.
11. Adjustment of Number of Shares and Related Matters. The number of
--------------------------------------------------
shares of Common Stock covered by this Stock Option, and the Option Exercise
Price thereof, shall be subject to adjustment in accordance with Article 12 of
----------
the Plan.
12. Optionee's Representations. Notwithstanding any of the provisions
--------------------------
hereof, the Optionee hereby agrees that he or she will not exercise this Stock
Option, and that the Company will not be obligated to issue any shares to the
Optionee hereunder, if the exercise thereof or the issuance of such shares shall
constitute a violation by the Optionee or the Company of any provision of any
law or regulation of any governmental authority. Any determination in this
connection by the Board or the Committee shall be final, binding, and
conclusive. The obligations of the Company and the rights of the Optionee are
subject to all applicable laws, rules and regulations.
13. Investment Representation. Unless the Common Stock is issued to the
-------------------------
Optionee in a transaction registered under applicable federal and state
securities laws, by his or her execution hereof, the Optionee represents and
warrants to the Company that all Common Stock which may be purchased hereunder
will be acquired by the Optionee for investment purposes for his or her own
account and not with any intent for resale or distribution in violation of
federal or state securities laws. Unless the Common Stock is issued to the
Optionee in a transaction registered under the applicable federal and state
securities laws, all certificates issued with respect to the Common Stock shall
bear an appropriate restrictive investment legend.
14. Optionee's Acknowledgments. The Optionee acknowledges receipt of a
--------------------------
copy of the Plan and represents that he or she is familiar with the terms and
provisions thereof, and hereby accepts this Option subject to all the terms and
provisions thereof. The Optionee hereby agrees to accept as binding, conclusive,
and final all decisions or interpretations of the Board or the Committee upon
any questions arising under the Plan or this Agreement.
15. Law Governing. This Agreement shall be governed by, construed, and
-------------
enforced in accordance with the laws of the State of Texas (excluding any
conflict of laws rule or principle of Texas law that might refer the governance,
construction, or interpretation of this agreement to the laws of another state).
16. No Right to Continued Employment. Nothing herein shall be construed
--------------------------------
to confer upon the Optionee the right to continue in the employment of the
Company or any Subsidiary or interfere with or restrict in any way the right of
the Company or any Subsidiary to discharge the Optionee at any time (subject to
any contract rights of the Optionee).
17. Legal Construction. In the event that any one or more of the terms,
------------------
provisions, or agreements that are contained in this Agreement shall be held by
a Court of competent jurisdiction to be invalid, illegal, or unenforceable in
any respect for any reason, the invalid, illegal, or
-4-
<PAGE>
unenforceable term, provision, or agreement shall not affect any other term,
provision, or agreement that is contained in this Agreement and this Agreement
shall be construed in all respects as if the invalid, illegal, or unenforceable
term, provision, or agreement had never been contained herein.
18. Covenants and Agreements as Independent Agreements. Each of the
--------------------------------------------------
covenants and agreements that is set forth in this Agreement shall be construed
as a covenant and agreement independent of any other provision of this
Agreement. The existence of any claim or cause of action of the Optionee
against the Company, whether predicated on this Agreement or otherwise, shall
not constitute a defense to the enforcement by the Company of the covenants and
agreements that are set forth in this Agreement.
19. Entire Agreement. This Agreement, together with the Plan, supersedes
----------------
any and all other prior understandings and agreements, either oral or in
writing, between the parties with respect to the subject matter hereof and
constitutes the sole and only agreement between the parties with respect to the
said subject matter. All prior negotiations and agreements between the parties
with respect to the subject matter hereof are merged into this Agreement. Each
party to this Agreement acknowledges that no representations, inducements,
promises, or agreements, oral or otherwise, have been made by any party or by
anyone acting on behalf of any party, which are not embodied in this Agreement
or the Plan and that any agreement, statement or promise that is not contained
in this Agreement or the Plan shall not be valid or binding or of any force or
effect.
20. Parties Bound. The terms, provisions, representations, warranties,
-------------
covenants, and agreements that are contained in this Agreement shall apply to,
be binding upon, and inure to the benefit of the parties and their respective
heirs, executors, administrators, legal representatives, and permitted
successors and assigns.
21. Modification. No change or modification of this Agreement shall be
------------
valid or binding upon the parties unless the change or modification is in
writing and signed by the parties. Notwithstanding the preceding sentence, the
Company may amend the Plan to the extent permitted in the Plan.
22. Headings. The headings that are used in this Agreement are used for
--------
reference and convenience purposes only and do not constitute substantive
matters to be considered in construing the terms and provisions of this
Agreement.
23. Gender and Number. Words of any gender used in this Agreement shall
-----------------
be held and construed to include any other gender, and words in the singular
number shall be held to include the plural, and vice versa, unless the context
requires otherwise.
24. Notice. Any notice required or permitted to be delivered hereunder
------
shall be deemed to be delivered only when actually received by the Company or by
the Optionee, as the case may be, at the addresses set forth below, or at such
other addresses as they have theretofore specified by written notice delivered
in accordance herewith:
-5-
<PAGE>
(A) Notice to the Company shall be addressed and delivered as
follows:
CELLSTAR CORPORATION
1730 BRIERCROFT COURT
CARROLLTON, TEXAS 75006
ATTENTION: GENERAL COUNSEL
(B) Notice to the Optionee shall be addressed and delivered as
follows:
[Name of Optionee]
________________________________________
________________________________________
________________________________________
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by
its duly authorized officer, and the Optionee, to evidence his or her consent
and approval of all the terms hereof, has duly executed this Agreement, as of
the ____ day of ___________, 19___.
CELLSTAR CORPORATION
By:
------------------------------------------
Name:
-----------------------------------------
Title:
----------------------------------------
OPTIONEE
--------------------------------------------------
[Name of Optionee]
-6-
<PAGE>
EXHIBIT 4.7
NONQUALIFIED STOCK OPTION AGREEMENT
CELLSTAR CORPORATION
1993 AMENDED AND RESTATED LONG-TERM INCENTIVE PLAN
This Nonqualified Stock Option Agreement (this "Agreement") is entered into
by and between CellStar Corporation, a Delaware corporation (the "Company"), and
_______________ (the "Optionee"). The Company and the Optionee agree as
follows:
1. Grant of Option. Pursuant to the CellStar Corporation 1993 Amended
---------------
and Restated Long-Term Incentive Plan (the "Plan") and a duly adopted resolution
of the Committee, the Company grants to the Optionee an option (the "Option") to
purchase from the Company a total of _________ shares (the "Optioned Shares") of
Common Stock of the Company at $________ per share (being the Fair Market Value
per share of the Common Stock on the Date of Grant), in the amounts, during the
periods, and upon the terms and conditions set forth in this Agreement and in
the Plan. The Date of Grant of this Option is _____________. This Option is not
intended to qualify as an "incentive stock option" within the meaning of Section
422 of the Code.
2. Interpretation. This Option and its exercise are subject to the terms
--------------
and conditions of the Plan, which terms and conditions are incorporated herein
by reference; however, unless specifically permitted by the Committee, the terms
of the Plan shall not be considered an enlargement of any benefits under this
Agreement. Capitalized terms used and not otherwise defined herein shall have
the meanings assigned to them in the Plan. This Option is subject to any rules
promulgated pursuant to the Plan by the Board or the Committee and communicated
to the Optionee in writing.
3. Vesting; Time of Exercise. Except as specifically provided in this
-------------------------
Agreement and subject to certain restrictions and conditions set forth in the
Plan, this Option may be exercised, in whole or in part, in accordance with the
following schedule:
<TABLE>
<CAPTION>
Percentage
Exercisable Period
----------- ------
<S> <C>
0% Immediately
25% On and after the first anniversary of the Date of Grant
50% On and after the second anniversary of the Date of Grant
75% On and after the third anniversary of the Date of Grant
100% On and after the fourth anniversary of the Date of Grant
</TABLE>
The unexercised portion of this Option from one annual period may be
carried over to a subsequent annual period or periods, and the right of the
Optionee to exercise the Option as to such
<PAGE>
unexercised portion shall continue for the entire term. In no event may the
Option be exercised in whole or in part, however, after the expiration of the
term set forth in Section 4 below.
4. Term; Rights in Event of Termination of Service. This Option, and all
-----------------------------------------------
unexercised Optioned Shares granted to the Optionee hereunder, will terminate
and be forfeited at the first of the following to occur:
(a) 5 p.m. on ________________;
(b) 5 p.m. on the date which is twelve (12) months following the
Optionee's Termination of Service due to death or Total and Permanent
Disability;
(c) 5 p.m. on the date which is three (3) months following the
Optionee's Termination of Service due to Retirement; or
(d) 5 p.m. on the 30th day after the day of any other Termination of
Service.
In the event of the Optionee's Termination of Service under subsections
(b),(c) or (d) above, the Option will be exercisable, for the periods indicated,
only to the extent that it has vested (pursuant to Section 3 above) as of the
date of Termination of Service.
5. Who May Exercise. Subject to the terms and conditions set forth in
----------------
Sections 3 and 4 above and the following sentence, during the lifetime of the
Optionee, unless transferred pursuant to a qualified domestic relations order
(see Section 8, below), this Option may be exercised only by the Optionee. In
the event of the Optionee's Termination of Service as a result of death or Total
and Permanent Disability prior to the termination date specified in Section 4(a)
hereof, the following persons may exercise this Option (to the extent it is
exercisable on the date of Termination of Service) on behalf of the Optionee at
any time prior to the earlier of the dates specified in Sections 4(a) or (b)
hereof: (i) if the Optionee's Termination of Service is due to Total and
Permanent Disability, the legal representative of the Optionee; or (ii) if the
Optionee dies, the personal representative of his estate, or the person who
acquires the right to exercise this Option by bequest or inheritance or by
reason of the death of the Optionee; provided that this Option shall remain
subject to the other terms of this Agreement, the Plan, and all applicable laws,
rules, and regulations.
6. Restrictions. This Option may be exercised only with respect to full
------------
shares, and no fractional share of stock shall be issued.
7. Manner of Exercise. Subject to such administrative regulations as the
------------------
Board or the Committee may from time to time adopt, this Option may be exercised
by the delivery to the Company of (i) written notice setting forth the number of
shares of Common Stock with respect to which the Option is to be exercised and
the date of exercise thereof (the "Exercise Date"), which shall be at least
three (3) days after giving such notice, unless an earlier time shall have been
mutually agreed upon; and (ii) consideration with a value equal to the total
Option Exercise Price for the shares to be purchased, payable as follows: (a)
cash, certified check, bank draft, or money
2
<PAGE>
order payable to the order of the Company, (b) Common Stock (including
Restricted Stock), valued at its Fair Market Value on the Exercise Date, (c) by
delivery (including by FAX) to the Company or its designated agent of an
executed irrevocable option exercise form together with irrevocable instructions
from the Optionee to a broker or dealer, reasonably acceptable to the Company,
to sell certain of the shares of Common Stock purchased upon exercise of the
Option or to pledge such shares as collateral for a loan and promptly deliver to
the Company the amount of sale or loan proceeds necessary to pay such Option
Exercise Price, and/or (d) in any other form of valid consideration that is
acceptable to the Committee in its sole discretion; provided that, with respect
to a cashless exercise of the Option (in accordance with clause (c) above), the
Option will be deemed exercised on the date of sale of the shares of Common
Stock received upon exercise. In the event that shares of Restricted Stock are
tendered as consideration for the exercise of the Option, a number of shares of
Common Stock issued upon the exercise of the Option, equal to the number of
shares of Restricted Stock used as consideration therefor, shall be subject to
the same restrictions as the Restricted Stock so submitted.
Upon payment of all amounts due from the Optionee, the Company shall cause
certificates for the Optioned Shares then being purchased to be delivered to the
Optionee (or the person exercising the Optionee's Option in the event of his
death) at its principal business office (or other mutually agreed upon location)
within ten (10) business days after the Exercise Date. The obligation of the
Company to deliver shares of Common Stock shall, however, be subject to the
condition that if at any time the Board or the Committee shall determine in its
discretion that the listing, registration, or qualification of the Option or the
Optioned Shares upon any securities exchange or under any state or federal law,
or the consent or approval of any governmental regulatory body, is necessary or
desirable as a condition of, or in connection with, the Option or the issuance
or purchase of shares of Common Stock thereunder, then the Option may not be
exercised in whole or in part unless such listing, registration, qualification,
consent, or approval shall have been effected or obtained free of any conditions
not acceptable to the Committee.
If the Optionee fails to pay for any of the Optioned Shares specified in
such notice or fails to accept delivery thereof, then the Optionee's right to
purchase such Optioned Shares may be terminated by the Company.
8. Non-Assignability. This Option is not assignable or transferable by
-----------------
the Optionee except (i) by will or by the laws of descent and distribution or
(ii) pursuant to the terms of a qualified domestic relations order (as defined
by the Code or Title I of ERISA, or the rules thereunder).
9. Rights as Stockholder. The Optionee will have no rights as a
---------------------
stockholder with respect to any shares covered by this Option until the issuance
of a certificate or certificates to the Optionee for the shares. Except as
otherwise provided in Section 10 hereof, no adjustment shall be made for
dividends or other rights for which the record date is prior to the issuance of
such certificate or certificates.
3
<PAGE>
10. Adjustment of Number of Shares and Related Matters. The number of
--------------------------------------------------
shares of Common Stock covered by this Option, and the Option Exercise Price
thereof, shall be subject to adjustment in accordance with Article 12 of the
----------
Plan.
11. Optionee's Representations. Notwithstanding any of the provisions
--------------------------
hereof, the Optionee hereby agrees that he or she will not exercise this Option,
and that the Company will not be obligated to issue any shares to the Optionee
hereunder, if the exercise thereof or the issuance of such shares shall
constitute a violation by the Optionee or the Company of any provision of any
law or regulation of any governmental authority. Any determination in this
connection by the Board or the Committee shall be final, binding, and
conclusive. The obligations of the Company and the rights of the Optionee are
subject to all applicable laws, rules, and regulations.
12. Investment Representation. Unless the Common Stock is issued to the
-------------------------
Optionee in a transaction registered under applicable federal and state
securities laws, by his or her execution hereof, the Optionee represents and
warrants to the Company that all Common Stock which may be purchased hereunder
will be acquired by the Optionee for investment purposes for his or her own
account and not with any intent for resale or distribution in violation of
federal or state securities laws. Unless the Common Stock is issued to the
Optionee in a transaction registered under the applicable federal and state
securities laws, all certificates issued with respect to the Common Stock shall
bear an appropriate restrictive investment legend.
13. Optionee's Acknowledgments. The Optionee acknowledges receipt of a
---------------------------
copy of the Plan and represents that he or she is familiar with the terms and
provisions thereof, and hereby accepts this Option subject to all the terms and
provisions thereof. The Optionee hereby agrees to accept as binding, conclusive,
and final all decisions or interpretations of the Board and/or the Committee
upon any questions arising under the Plan or this Agreement.
14. Law Governing. This Agreement shall be governed by, construed, and
-------------
enforced in accordance with the laws of the State of Texas (excluding any
conflict of laws rule or principle of Texas law that might refer the governance,
construction, or interpretation of this agreement to the laws of another state).
15. No Right to Continued Employment. Nothing herein shall be construed
--------------------------------
to confer upon the Optionee the right to continue in the employment of the
Company or any Subsidiary or interfere with or restrict in any way the right of
the Company or any Subsidiary to discharge the Optionee at any time (subject to
any contract rights of the Optionee).
16. Legal Construction. In the event that any one or more of the terms,
-------------------
provisions, or agreements that are contained in this Agreement shall be held by
a Court of competent jurisdiction to be invalid, illegal, or unenforceable in
any respect for any reason, the invalid, illegal, or unenforceable term,
provision, or agreement shall not affect any other term, provision, or agreement
that is contained in this Agreement and this Agreement shall be construed in all
respects as if the invalid, illegal, or unenforceable term, provision, or
agreement had never been contained herein.
4
<PAGE>
17. Covenants and Agreements as Independent Agreements. Each of the
--------------------------------------------------
covenants and agreements that is set forth in this Agreement shall be construed
as a covenant and agreement independent of any other provision of this
Agreement. The existence of any claim or cause of action of the Optionee against
the Company, whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Company of the covenants and
agreements that are set forth in this Agreement.
18. Entire Agreement. This Agreement, together with the Plan, supersedes
----------------
any and all other prior understandings and agreements, either oral or in
writing, between the parties with respect to the subject matter hereof and
constitutes the sole and only agreement between the parties with respect to the
said subject matter. All prior negotiations and agreements between the parties
with respect to the subject matter hereof are merged into this Agreement. Each
party to this Agreement acknowledges that no representations, inducements,
promises, or agreements, oral or otherwise, have been made by any party or by
anyone acting on behalf of any party, which are not embodied in this Agreement
or the Plan and that any agreement, statement or promise that is not contained
in this Agreement or the Plan shall not be valid or binding or of any force or
effect.
19. Parties Bound. The terms, provisions, representations, warranties,
-------------
covenants, and agreements that are contained in this Agreement shall apply to,
be binding upon, and inure to the benefit of the parties and their respective
heirs, executors, administrators, legal representatives, and permitted
successors and assigns.
20. Modification. No change or modification of this Agreement shall be
------------
valid or binding upon the parties unless the change or modification is in
writing and signed by the parties. Notwithstanding the preceding sentence, the
Company may amend the Plan to the extent permitted in the Plan.
21. Headings. The headings that are used in this Agreement are used for
--------
reference and convenience purposes only and do not constitute substantive
matters to be considered in construing the terms and provisions of this
Agreement.
22. Gender and Number. Words of any gender used in this Agreement shall
-----------------
be held and construed to include any other gender, and words in the singular
number shall be held to include the plural, and vice versa, unless the context
requires otherwise.
23. Notice. Any notice required or permitted to be delivered hereunder
------
shall be deemed to be delivered only when actually received by the Company or by
the Optionee, as the case may be, at the addresses set forth below, or at such
other addresses as they have theretofore specified by written notice delivered
in accordance herewith:
5
<PAGE>
(A) Notice to the Company shall be addressed and delivered as
follows:
CELLSTAR CORPORATION
1730 BRIERCROFT COURT
CARROLLTON, TEXAS 75006
ATTENTION: GENERAL COUNSEL
(B) Notice to the Optionee shall be addressed and delivered as
follows:
[Name of Optionee]
________________________________________
________________________________________
________________________________________
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by
its duly authorized officer, and the Optionee, to evidence his consent and
approval of all the terms hereof, has duly executed this Agreement, as of the
______ day of __________, 19____.
CELLSTAR CORPORATION
By: ______________________________________
Name: ____________________________________
Title: ___________________________________
OPTIONEE:
__________________________________________
[Name of Optionee]
6
<PAGE>
[HAYNES AND BOONE, LLP LETTERHEAD APPEARS HERE]
EXHIBIT 5.1
April 30, 1999
CellStar Corporation
1730 Briercroft Court
Carrollton, Texas 75006
Re: Registration of Securities of CellStar Corporation on Form S-8
Gentlemen:
We have acted as special counsel to CellStar Corporation, a Delaware corporation
(the "Company"), in connection with the preparation of the Registration
Statement on Form S-8 (the "Registration Statement") filed with the Securities
and Exchange Commission under the Securities Act of 1933, as amended, relating
to the registration of 2,000,000 shares of Common Stock of the Company, par
value $.01 per share (the "Common Stock"), that may be issued pursuant to the
CellStar Corporation 1993 Amended and Restated Long Term Incentive Plan (the
"Plan").
In connection therewith, we have examined (i) the Restated Certificate of
Incorporation and the Bylaws of the Company, each as amended; (ii) minutes and
records of the corporate proceedings of the Company with respect to the adoption
of the Plan and the granting of stock options thereunder; (iii) certificates of
certain officers and directors of the Company; (iv) the Plan and the form of
stock option agreements pertaining thereto; and (v) such other documents as we
have deemed necessary for the expression of the opinions contained herein.
In making the foregoing examination, we have assumed the genuineness of all
signatures and the authenticity of all documents submitted to us as originals,
and the conformity to original documents of all documents submitted to us as
certified or photostatic copies. Furthermore, we have assumed that the exercise
prices of all stock options that may be granted under the Plans will equal or
exceed the par value per share of the Common Stock. As to questions of fact
material to this opinion, where such facts have not been
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CellStar Corporation
April 30, 1999
Page 2
independently established, and as to the content and form of the Restated
Certificate of Incorporation (as amended), Bylaws (as amended), minutes,
records, resolutions and other documents or writings of the Company, we have
relied, to the extent we deem reasonably appropriate, upon representations or
certificates of officers or directors of the Company and upon documents, records
and instruments furnished to us by the Company, without independent check or
verification of their accuracy.
Based upon the foregoing, and having due regard for such legal considerations as
we deem relevant, we are of the opinion that the 2,000,000 shares of Common
Stock covered by the Registration Statement which may be issued from time to
time pursuant to the exercise of options duly granted or which may be duly
granted in accordance with the terms of the Plan have been duly authorized for
issuance by the Company, and, when so issued in accordance with the terms and
conditions of the Plan and the related option agreements upon the valid exercise
of options granted pursuant to the Plan, will be validly issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement and to the reference to
our firm under the caption, "Item 5. Interests of Named Experts and Counsel" in
the Registration Statement.
Very truly yours,
/s/ Haynes and Boone, LLP
Haynes and Boone, LLP
<PAGE>
Exhibit 23.1
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CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
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The Board of Directors
CellStar Corporation
We consent to the use of our report incorporated by reference herein and to the
reference to our firm under the heading "Experts" in the registration statement.
/s/ KPMG LLP
Dallas, Texas
April 29, 1999
