<PAGE> 1
SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. __)
<TABLE>
<CAPTION>
<S> <C>
Filed by the registrant X
Filed by a party other than the registrant _
Check the appropriate box: _ Confidential, for use of the
_ Preliminary proxy statement Commission only (as permitted by
X Definitive proxy statement Rule 14a-6(e)(2))
_ Definitive additional materials
_ Soliciting material pursuant to Rule
14a-11(c) or Rule 14a-12
Brightpoint, Inc.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, If Other Than Registrant)
Payment of filing fee (Check the appropriate box):
X No fee required.
_ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (Set forth the
amount on which the filing fee is calculated and state how
it was determined.)
- --------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------
(5) Total Fee Paid:
- --------------------------------------------
_ Fee paid previously with preliminary materials.
- --------------------------------------------
_ Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount previously paid:
- --------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- --------------------------------------------
(3) Filing party:
- --------------------------------------------
(4) Date filed:
- --------------------------------------------
</TABLE>
<PAGE> 2
BRIGHTPOINT, INC.
6402 CORPORATE DRIVE
INDIANAPOLIS, INDIANA 46278
April 15, 1999
Dear Brightpoint, Inc. Stockholders:
You are cordially invited to attend the Annual Meeting of Stockholders
of Brightpoint, Inc. (the "Company") which will be held on Tuesday, May 18,
1999, at 10:00 A.M. local time at the Westin Hotel Indianapolis, 50 South
Capitol Avenue, Indianapolis, Indiana 46204.
The Notice of Annual Meeting and Proxy Statement which follow describe
the business to be conducted at the meeting.
Your Board of Directors unanimously believes that the election as
directors of the nominees listed in the accompanying proxy statement and the
approval of proposals to amend the Company's 1994 Stock Option Plan and to adopt
the Company's 1999 Employee Stock Purchase Plan is in the best interests of the
Company and its stockholders, and accordingly, recommends a vote "FOR" such
nominees and proposals.
Whether or not you plan to attend the meeting in person, it is
important that your shares be represented and voted. After reading the enclosed
Notice of Annual Meeting and Proxy Statement, may I urge you to complete, sign,
date and return the enclosed proxy card in the envelope provided. If the address
on the accompanying material is incorrect, please advise our Transfer Agent,
American Stock Transfer & Trust Company, in writing, at 40 Wall Street, New
York, New York 10005 or by telephone at 1-800-937-5449.
You may submit your proxy vote with the enclosed paper card or you can
vote by telephone or via the Internet. See Voting by Telephone or via the
Internet in the Proxy Statement for further details. Please note that there are
separate telephone and Internet voting arrangements depending upon whether
shares are registered in your name or in the name of a bank or broker.
Your vote is very important, and we will appreciate a prompt return of
your signed proxy card, your prompt vote by telephone or via the Internet. We
appreciate your continued support and look forward to seeing you at the Annual
Meeting.
Sincerely yours,
/s/ ROBERT J. LAIKIN
Robert J. Laikin
Chairman of the Board and
Chief Executive Officer
<PAGE> 3
BRIGHTPOINT, INC.
6402 CORPORATE DRIVE
INDIANAPOLIS, INDIANA 46278
--------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD TUESDAY, MAY 18, 1999
--------------------
To the Stockholders of BRIGHTPOINT, INC.:
NOTICE IS HEREBY GIVEN that the Annual Meeting ("Annual Meeting") of
Stockholders of Brightpoint, Inc. will be held on Tuesday, May 18, 1999, at
10:00 A.M. local time, at the Westin Hotel Indianapolis, 50 South Capitol
Avenue, Indianapolis, Indiana 46204, for the following purposes:
1. To elect three (3) Class II directors to hold office until the
Annual Meeting of Stockholders to be held in 2002 and until their respective
successors have been duly elected and qualified;
2. To consider and vote on a proposal to approve an amendment to the
Company's 1994 Stock Option Plan to increase the total number of shares reserved
for issuance thereunder from 8,200,000 to 10,500,000;
3. To consider and vote on a proposal to approve the adoption of the
proposed Brightpoint, Inc. 1999 Employee Stock Purchase Plan and the reserve of
2,000,000 shares to be sold to employees thereunder; and
4. To transact such other business as may properly come before the
Annual Meeting or any adjournment or adjournments thereof.
Only stockholders of record at the close of business on April 8, 1999
are entitled to notice of and to vote at the Annual Meeting or any adjournments
thereof.
By Order of the Board of Directors,
/s/ STEVEN E. FIVEL
Steven E. Fivel
Secretary
April 15, 1999
- --------------------------------------------------------------------------------
IF YOU DO NOT EXPECT TO BE PRESENT AT THE MEETING:
PLEASE FILL IN, DATE, SIGN AND RETURN THE ENCLOSED PAPER PROXY CARD IN THE
ENVELOPE PROVIDED FOR THAT PURPOSE, WHICH REQUIRES NO POSTAGE IF MAILED IN THE
UNITED STATES. IF YOU CHOOSE YOU MAY ALSO VOTE BY TELEPHONE OR VIA THE INTERNET.
YOUR PROXY MAY BE REVOKED AT ANY TIME PRIOR TO EXERCISE, AND IF YOU ARE PRESENT
AT THE MEETING YOU MAY, IF YOU WISH, REVOKE YOUR PROXY AT THAT TIME AND EXERCISE
THE RIGHT TO VOTE YOUR SHARES PERSONALLY.
<PAGE> 4
BRIGHTPOINT, INC.
6402 CORPORATE DRIVE
INDIANAPOLIS, INDIANA 46278
-------------------
PROXY STATEMENT
-------------------
ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON TUESDAY, MAY 18, 1999
This proxy statement (the "Proxy Statement") is furnished in connection
with the solicitation of proxies by the Board of Directors of Brightpoint, Inc.
(the "Company") for use at the Annual Meeting of Stockholders (the "Annual
Meeting") to be held on Tuesday, May 18, 1999, including any adjournment or
adjournments thereof, for the purposes set forth in the accompanying Notice of
Meeting.
Management intends to mail this proxy statement and the accompanying
form of proxy to stockholders on or about April 15, 1999.
Proxies in the accompanying form, duly executed and returned to the
management of the Company and not revoked, will be voted at the Annual Meeting.
Any proxy given pursuant to such solicitation may be revoked by the stockholder
at any time prior to the voting of the proxy by a subsequently dated proxy, by
written notification to the Secretary of the Company, or by personally
withdrawing the proxy at the Annual Meeting and voting in person.
The address and telephone number of the principal executive offices of
the Company are: 6402 Corporate Drive, Indianapolis, Indiana 46278, Telephone
No.: (317) 297-6100.
The following questions and answers provide important information about
the Annual Meeting and this Proxy Statement:
Q. What am I voting on?
A. - Election of three Class II directors (Robert J. Laikin, Robert F.
Wagner and Rollin M. Dick).
- A proposal to approve an amendment to the Company's 1994 Stock Option
Plan to increase the number of shares reserved for issuance thereunder
from 8,200,000 shares to 10,500,000 shares.
- A proposal to approve the adoption of the Company's 1999 Employee Stock
Purchase Plan and the reserve of 2,000,000 shares of common stock to
be sold to employees thereunder.
<PAGE> 5
Q. Who is entitled to vote?
A. Stockholders as of the close of business on April 8, 1999, are entitled to
vote at the Annual Meeting. Each stockholder is entitled to one vote for each
share of common stock held.
Q. How do I vote?
A. You may sign and date each paper proxy card you receive and return it in the
prepaid envelope. If you return your signed proxy but do not indicate your
voting preferences, we will vote on your behalf FOR the election of the three
Class II directors and the approval of the proposal to amend the Company's 1994
Stock Option Plan and the proposal to adopt the Company's 1999 Employee Stock
Purchase Plan. You have the right to revoke your proxy any time before the
meeting by (1) notifying the Company's Secretary, or (2) returning a later-dated
proxy. You may also revoke your proxy by voting in person at the Annual Meeting.
You may also vote by telephone or via the Internet. See Voting by Telephone or
via the Internet below for further details. Please note that there are separate
telephone and internet voting arrangements depending upon whether shares are
registered in your name or in the name of a bank or broker.
Q. How do I sign the paper proxy card?
A. Sign your name exactly as it appears on the proxy card. If you are signing in
a representative capacity (for example, as an attorney, executor, administrator,
guardian, trustee, or the officer or agent of a company), you should indicate
your name and title or capacity. If the stock is held in custody for a minor
(for example, under the Uniform Transfers to Minors Act), the custodian should
sign, not the minor. If the stock is held in joint ownership, one owner may sign
on behalf of all the owners.
Q. What does it mean if I receive more than one proxy card?
A. It may mean that you hold shares registered in more than one account. Sign
and return all proxy cards to ensure that all your shares are voted. You may
call American Stock Transfer & Trust Company at 1-800-937-5449 if you have any
questions regarding the share information or your address appearing on the paper
proxy card.
Q. Who will count the votes?
A. One or more Representatives of American Stock Transfer & Trust Company will
tabulate the votes and act as independent inspectors of election.
Q. What constitutes a quorum?
A. A majority of the outstanding shares, present or represented by proxy,
constitutes a quorum for the Annual Meeting. As of April 8, 1999, 53,285,070
shares of the Company's common stock were issued and outstanding.
-2-
<PAGE> 6
Q. How many votes are needed for approval of each item?
A. There are different vote requirements for the various proposals. Directors
will be elected by a plurality of the votes cast at the Annual Meeting, meaning
the nominees receiving the highest number of votes will be elected directors.
Only votes cast for a nominee will be counted, except that a properly executed
proxy that does not specify a vote with respect to the nominees will be voted
for the three nominees. Abstentions and broker non-votes (as described below)
will have no effect on the election of directors.
The proposal to amend the 1994 Stock Option Plan and the proposal to approve the
adoption of the Company's 1999 Employee Stock Purchase Plan will be approved if
the votes cast for the proposal exceed those cast against the proposal. Broker
non-votes will not be counted as votes cast either for or against the proposals.
Q. What is "broker non-vote"?
A. A "broker non-vote" occurs when a broker submits a proxy that does not
indicate a vote for some of the proposals because the broker has not received
instructions from the beneficial owners of how to vote on such proposals and
does not have discretionary authority to vote in the absence of instructions.
-3-
<PAGE> 7
OUTSTANDING STOCK AND VOTING RIGHTS
Only stockholders of record at the close of business on April 8, 1999
(the "Record Date") are entitled to notice of and to vote at the Annual Meeting.
As of the Record Date, there were issued and outstanding 53,285,070 shares of
the Company's Common Stock, $.01 par value per share (the "Common Stock"), the
Company's only class of voting securities. Each share entitles the holder to one
vote on each matter submitted to a vote at the Annual Meeting.
VOTING PROCEDURES AND PROXY INFORMATION
The directors will be elected by the affirmative vote of a plurality of
the shares of Common Stock present in person or represented by proxy at the
Annual Meeting, provided a quorum exists. A quorum is established if at least a
majority of the outstanding shares of Common Stock as of the Record Date are
present in person or represented by proxy at the Annual Meeting. All other
matters at the meeting will be decided by the affirmative vote of a majority of
the shares of Common Stock present in person or represented by proxy at the
meeting and entitled to vote on the subject matter, provided a quorum exists.
Votes will be counted and certified by one or more Inspectors of Election who
are expected to be employees of American Stock Transfer & Trust Company, the
Company's transfer agent.
In accordance with Delaware law, abstentions and "broker non-votes"
(i.e., proxies from brokers or nominees indicating that such persons have not
received instructions from the beneficial owner or other persons entitled to
vote shares as to a matter with respect to which the brokers or nominees do not
have discretionary power to vote) will be treated as present for purposes of
determining the presence of a quorum. For purposes of determining approval of a
matter presented at the meeting, abstentions will be deemed present and entitled
to vote and will, therefore, have the same legal effect as a vote "against" a
matter presented at the meeting. Broker non-votes will be deemed not entitled to
vote on the subject matter as to which the non-vote is indicated. Abstentions
and broker non-votes will have no effect on the election of directors.
The enclosed proxies will be voted in accordance with the instructions
thereon. Unless otherwise stated, all shares represented by such proxy will be
voted as instructed. Proxies may be revoked as noted above.
The entire cost of soliciting proxies, including the costs of
preparing, assembling, printing and mailing this Proxy Statement, the proxy and
any additional soliciting material furnished to stockholders, will be borne by
the Company. Arrangements will be made with brokerage houses and other
custodians, nominees and fiduciaries to send proxies and proxy materials to the
beneficial owners of stock, and such persons may be reimbursed for their
expenses by the Company. The Company has retained D.F. King & Co., Inc. to
solicit proxies for a fee of $6,000 and a reasonable amount to cover expenses.
Proxies may also be solicited by certain of the directors, officers or employees
of the Company, without additional compensation, in person or by telephone,
telegram or other means.
-4-
<PAGE> 8
VOTING BY TELEPHONE OR VIA THE INTERNET
For Shares Registered in the Name of a Brokerage Firm or Bank. A number
of brokerage firms and banks are participating in a program provided through ADP
Investor Communication Services that offers telephone and Internet voting
options. This program is different than the program provided by American Stock
Transfer & Trust Company for shares registered in the name of the stockholder.
If your shares are held in an account at a brokerage firm or bank participating
in the ADP program, you may vote those shares telephonically by calling the
telephone number referenced on your voting form. If your shares are held in an
account at a brokerage firm or bank participating in the ADP program, you
already have been offered the opportunity to elect to vote via the Internet.
Votes submitted via the Internet through the ADP program must be received by
11:59 p.m.(EDT) on May 17, 1999. The giving of such proxy will not affect your
right to vote in person should you decide to attend the Annual Meeting.
For Shares Directly Registered in the Name of the Stockholder.
Stockholders with shares registered directly with American Stock Transfer &
Trust Company may vote telephonically by calling American Stock Transfer & Trust
Company at 1-800-776-9437 or you may vote via the Internet at www.voteproxy.com.
The telephone and Internet voting procedures are designed to
authenticate stockholders identities, to allow stockholders to give their voting
instructions and to confirm that stockholders' instructions have been recorded
properly. Stockholders voting via the Internet through either American Stock
Transfer & Trust Company or ADP Investor Communication Services should
understand that there may be costs associated with electronic access, such as
usage charges from Internet access providers and telephone companies, that must
be borne by the stockholder.
-5-
<PAGE> 9
ELECTION OF DIRECTORS
The Company's By-laws provide that the Board of Directors of the
Company is divided into three classes (Class I, Class II and Class III). At each
Annual Meeting of Stockholders, directors constituting one class are elected for
a three-year term. At this year's Annual Meeting, three (3) Class II directors
will be elected to hold office for a term expiring at the Annual Meeting of
Stockholders to be held in 2002. It is the intention of the Board of Directors
to nominate Robert J. Laikin, Robert F. Wagner and Rollin M. Dick as Class II
directors. Each director will be elected to serve until a successor is elected
and qualified or until the director's earlier resignation or removal.
At this year's Annual Meeting, the proxies granted by stockholders will
be voted individually for the election, as directors of the Company, of the
persons listed below, unless a proxy specifies that it is not to be voted in
favor of a nominee for director. In the event any of the nominees listed below
shall be unable to serve, it is intended that the proxy will be voted for such
other nominees as are designated by the Board of Directors. Each of the persons
named below has indicated to the Board of Directors of the Company that he will
be available to serve.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE
ELECTION OF THE NOMINEES SPECIFIED BELOW.
The following table sets forth the names, ages and principal
occupations of the nominees for election at this Annual Meeting and the length
of continuous service as a director of the Company:
CLASS II DIRECTORS
(To be elected)
(Term Expires in 2002)
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION
NOMINEE AGE OR EMPLOYMENT DIRECTOR SINCE
------- --- -------------------- --------------
<S> <C> <C> <C>
Robert J. Laikin............. 35 Chairman of the Board and Chief 1989
Executive Officer of the Company
Robert F. Wagner............. 64 Partner of Law Firm of Lewis & Wagner 1994
Rollin M. Dick............... 67 Executive Vice President and Chief 1994
Financial Officer of Conseco, Inc.
</TABLE>
-6-
<PAGE> 10
The following tables set forth similar information with respect to
incumbent directors in Class I and Class III of the Board of Directors who are
not nominees for election at this Annual Meeting:
CLASS I DIRECTORS
(Term Expires in 2001)
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION
NOMINEE AGE OR EMPLOYMENT DIRECTOR SINCE
------- --- -------------------- --------------
<S> <C> <C> <C>
J. Mark Howell............... 34 President and Chief Operating Officer 1994
of the Company
Stephen H. Simon............. 33 President and Chief Executive Officer, 1994
Melvin Simon & Associates, Inc.
Todd H. Stuart............... 33 Vice President and Director of Stuart's 1997
Moving and Storage, Inc.
</TABLE>
CLASS III DIRECTORS
(Term Expires in 2000)
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION
NOMINEE AGE OR EMPLOYMENT DIRECTOR SINCE
------- --- -------------------- --------------
<S> <C> <C> <C>
John W. Adams................ 50 Vice President of Browning Investments, 1994
Inc.
Steven B. Sands.............. 40 Co-Chairman and Chief Executive Officer 1994
of Sands Brothers & Co., Ltd.
</TABLE>
Set forth below is a description of the backgrounds of each of the
directors and executive officers of the Company:
Robert J. Laikin, a founder of the Company, has been a director of the
Company since its inception in August 1989. Mr. Laikin has been Chairman of the
Board and Chief Executive Officer of the Company since January 1994. Mr. Laikin
was President of the Company from June 1992 until September 1996 and Vice
President and Treasurer of the Company from August 1989 until May 1992. From
July 1986 to December 1987, Mr. Laikin was Vice President and, from January 1988
to February 1993, President of Century Cellular Network, Inc., a company engaged
in the retail sale of cellular telephones and accessories. Mr. Laikin is a
nominee to become a director of First Indiana Corporation, a publicly-held
diversified financial services holding company.
J. Mark Howell has been a director of the Company since October 1994.
Mr. Howell has been President of the Company since September 1996 and Chief
Operating Officer of the Company from September 1995 to April 16, 1998 and from
July 16, 1998 to present. He was Executive Vice President, Finance, Chief
Financial Officer, Treasurer and Secretary of the Company from July 1994 until
September 1996. From July 1992 until joining the Company, Mr. Howell was
Corporate Controller for ADESA Corporation, a company which owns and operates
automobile auctions in the United States and Canada. Prior thereto, Mr. Howell
was a Manager with Ernst & Young LLP.
-7-
<PAGE> 11
John W. Adams has been a director of the Company since April 1994.
Since October 1983, Mr. Adams has been Vice President of Browning Investments,
Inc., a commercial real estate development company. Mr. Adams is a trustee of
Century Realty Trust, a publicly-held real estate investment trust.
Rollin M. Dick has been a director of the Company since April 1994.
Since February 1986, Mr. Dick has been Executive Vice President and Chief
Financial Officer of Conseco, Inc., a publicly-held life insurance holding
company. Mr. Dick is also a director of Conseco, Inc.
Steven B. Sands has been a director of the Company since May 1994.
Since November 1990, Mr. Sands has been Co-Chairman and Chief Executive Officer
of Sands Brothers & Co., Ltd., an investment banking firm. Mr. Sands is a
director of Semiconductor Packaging Materials Co., Inc., a semiconductor
components manufacturer, Command Security Corp., a provider of security guards,
and The Village Green Bookstore, Inc., a bookstore owner and operator, each a
publicly-held company.
Stephen H. Simon has been a director of the Company since April 1994.
Mr. Simon has been President and Chief Executive Officer of Melvin Simon &
Associates, Inc., a privately-held shopping center development company, since
February 1997. From December 1993 until February 1997, Mr. Simon was Director of
Development for an affiliate of Simon Property Group, a publicly-held real
estate investment trust. From November 1991 to December 1993, Mr. Simon was
Development Manager of Melvin Simon & Associates, Inc.
Todd H. Stuart has been a director of the Company since November 1997.
Mr. Stuart has been Vice President, since May 1993, and Director of
Transportation, since May 1985, of Stuart's Moving and Storage, Inc., a provider
of domestic and international logistics and transportation services.
Robert F. Wagner has been a director of the Company since April 1994.
Mr. Wagner has been engaged in the practice of law with the firm of Lewis &
Wagner since 1973.
Phillip A. Bounsall, age 38, has been Executive Vice President, Chief
Financial Officer and Treasurer of the Company since October 1996. From March
1994 until September 1996, Mr. Bounsall was Chief Financial Officer of Walker
Information, Inc., a provider of customer satisfaction measurement and other
information services. Previously, Mr. Bounsall was a senior manager with Ernst &
Young LLP, where he worked for 12 years.
Steven E. Fivel, age 38, has been Executive Vice President, General
Counsel and Secretary of the Company since January 1997. From December 1993
until January 1997, Mr. Fivel was an attorney with an affiliate of Simon
Property Group, a publicly-held real estate investment trust. From February 1988
to December 1993, Mr. Fivel was an attorney with Melvin Simon & Associates,
Inc., a privately-held shopping center development company.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Based solely on a review of Forms 3, 4 and 5 and amendments thereto
furnished to the Company with respect to its most recent fiscal year, the
Company believes that all required reports were filed on a timely basis.
MEETINGS OF DIRECTORS AND COMMITTEES
During the fiscal year ended December 31, 1998, the Board of Directors
held seven meetings. In addition, the Board took other action by unanimous
written consent in lieu of a meeting. During 1998, each member of the Board
participated in at least 75% of all Board and applicable committee meetings held
during the period for which he was a director.
-8-
<PAGE> 12
The Board of Directors maintains a Compensation Committee which has the
power to establish the compensation policies of the Company and the specific
compensation of the Company's executive officers and to administer the Company's
1994 Stock Option Plan, 1996 Stock Option Plan and Non-Employee Director Stock
Option Plan. The current members of the Compensation Committee are Messrs.
Wagner and Adams. During 1998, the Compensation Committee held one meeting. In
addition, the Compensation Committee took other action by unanimous written
consent in lieu of a meeting.
The Board of Directors also maintains an Audit Committee which has the
power to recommend to the Board, and monitor the performance of, the firm of
independent public accountants to be selected by the Company and supervise the
audit and financial procedures of the Company. The current members of the Audit
Committee are Messrs. Dick, Simon and Stuart. During 1998, the Audit Committee
held five meetings.
The Board of Directors has also designated an Executive Committee which
met two times and is comprised of Messrs. Dick, Howell, Laikin and Wagner. The
Company does not have a Nominating Committee.
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table discloses for the periods presented the
compensation for the person who served as the Company's Chief Executive Officer
and for each of the five highest paid executive officers (not including the
Chief Executive Officer) of the Company whose total individual compensation
exceeded $100,000 for the Company's fiscal year ended December 31, 1998 (the
"Named Executives"):
<TABLE>
<CAPTION>
Long-Term
Compensation
Annual Compensation Awards
-------------------------------- Other --------------------------
Annual Securities Underlying
Name and Principal Position Year Salary Bonus Compensation(8) Options
- --------------------------------------------------------------- --------------- ---------------- --------------------------
<S> <C> <C> <C> <C> <C>
Robert J. Laikin.................... 1998 $ 200,000 $ 200,000 $ 2,250 350,000
Chairman of the Board and Chief 1997 200,000 700,000 2,375 200,000
Executive Officer 1996 180,000 200,000 2,375 750,000
J. Mark Howell...................... 1998 200,000 200,000 2,292 300,000
President and Chief Operating 1997 200,000 700,000 2,375 200,000
Officer 1996 150,000 175,000 2,375 750,000
Phillip A. Bounsall................. 1998 150,000 100,000 2,263 150,000
Executive Vice President, Chief 1997 125,000 300,000 -- 50,000
Financial Officer and Treasurer 1996 26,042(1) 125,000(2) -- 187,750
Steven E. Fivel..................... 1998 150,000 100,000 1,094 125,000
Executive Vice President, General 1997 125,000 325,000(3) -- 143,750
Counsel and Secretary 1996 -- -- -- --
Dana E. Marlin...................... 1998 100,000(4) 200,000 -- 50,000
Executive Vice President 1997 162,700 200,000 -- 400,000
1996 62,700(5) 250,000 -- 44,250
T. Scott Housefield................. 1998 200,000(6) 276,667(7) -- 200,000
Executive Vice President 1997 200,000 700,000 2,375 200,000
1996 150,000 175,000 2,375 750,000
</TABLE>
-9-
<PAGE> 13
(1) Mr. Bounsall's employment with the Company commenced on October 14, 1996.
(2) Includes a signing bonus of $100,000.
(3) Includes a signing bonus of $25,000.
(4) Mr. Marlin resigned as an officer and employee of the Company effective as
of June 30, 1998.
(5) Mr. Marlin's employment with the Company commenced on August 1, 1996.
(6) Mr. Housefield resigned from the Board of Directors, as an officer and as
an employee of the Company effective as of November 2, 1998.
(7) Includes $76,667 in severance payments of which $16,667 was paid in 1998
with the remainder payable in 6 equal monthly installments during 1999.
(8) For Messrs. Laikin, Howell, Bounsall, Fivel and Housefield represents the
Company's matching contributions to their respective 401(k) accounts.
OPTION GRANTS IN LAST FISCAL YEAR
The following table provides information with respect to individual
stock options granted during fiscal 1998 to each of the Named Executives:
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE AT
% OF TOTAL ASSUMED ANNUAL RATES OF STOCK
SHARES OPTIONS PRICE APPRECIATION FOR OPTION
UNDERLYING GRANTED TO EXERCISE TERM(2)
OPTIONS EMPLOYEES IN PRICE EXPIRATION ------------------------------
NAME GRANTED(1) FISCAL YEAR ($/SH) DATE 5% 10%
- ------------------------------ --------------- ------------ -------- ------------ ------------------------------
<S> <C> <C> <C> <C> <C> <C>
Robert J. Laikin............. 200,000 7.0% $ 14.38 01/01/03 $ 794,309 $ 1,755,216
115,000(3) 4.0% 7.50 10/09/03 238,293 426,565
35,000 1.2% 7.50 10/09/03 72,524 160,259
J. Mark Howell............... 200,000 7.0% 14.38 01/01/03 794,309 1,755,216
100,000 3.5% 7.50 10/09/03 207,211 457,883
Phillip A. Bounsall.......... 75,000 2.6% 14.38 01/01/03 297,866 658,206
75,000 2.6% 7.50 10/09/03 155,408 343,412
Steven E. Fivel.............. 75,000 2.6% 14.38 01/01/03 297,866 658,206
50,000 1.7% 7.50 10/09/03 103,606 228,941
Dana E. Marlin............... 50,000(4) 1.7% 14.38 01/01/03 198,577 438,804
T. Scott Housefield.......... 200,000(5) 7.0% 14.38 01/01/03 794,309 1,755,216
</TABLE>
- ----------------
(1) All options were granted under the Company's 1994 Stock Option Plan, except
as indicated below, and, except as indicated below, are exercisable as to
one-third of the shares covered thereby on the first, second and third
anniversaries of the date of grant.
-10-
<PAGE> 14
(2) The potential realizable value columns of the table illustrate values that
might be realized upon exercise of the options immediately prior to their
expiration, assuming the Company's Common Stock appreciates at the
compounded rates specified over the term of the options. These numbers do
not take into account provisions of options providing for termination of
the option following termination of employment or nontransferability of the
options and do not make any provision for taxes associated with exercise.
Because actual gains will depend upon, among other things, future
performance of the Common Stock, there can be no assurance that the amounts
reflected in this table will be achieved.
(3) These options were granted under the Company's 1996 Stock Option Plan.
(4) These options became exercisable on January 25, 1999.
(5) Pursuant to the provisions of the Company's 1994 Stock Option Plan, these
options were cancelled upon Mr. Housefield's resignation effective November
2, 1998.
AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUES
The following table sets forth information concerning each exercise of
stock options by each of the Named Executives during the fiscal year ended
December 31, 1998 and the value of unexercised stock options held by the Named
Executives as of December 31, 1998:
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
SHARES OPTIONS AT DECEMBER 31, 1998 AT DECEMBER 31, 1998 (1)
ACQUIRED ON VALUE ------------------------------ ------------------------------
NAME EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- -------------------------- -------------- ------------- ------------ --------------- ----------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Robert J. Laikin......... 301,880 $ 3,632,241 394,998 733,332 $ 2,706,251 $ 2,917,499
J. Mark Howell........... 159,366 2,249,687 641,678 683,332 4,553,350 2,604,999
Phillip A. Bounsall...... 62,500 828,000 79,166 245,834 482,500 963,751
Steven E. Fivel.......... 31,250 305,156 16,666 220,834 12,500 590,626
Dana E. Marlin........... 144,250 1,480,995 -- 250,000 -- 150,000
T. Scott Housefield...... 500,000 4,905,500 66,666 -- 50,000 --
</TABLE>
- ---------------
(1) Year-end values for unexercised in-the-money options represent the
positive spread between the exercise price of such options and the year-end
market value of the Common Stock.
-11-
<PAGE> 15
DIRECTOR COMPENSATION
For the fiscal year ended December 31, 1998, each non-employee director
received cash compensation of $10,000 per annum, $2,500 for each meeting of the
Board of Directors attended, and $1,000 for each meeting of a committee of the
Board of Directors attended. The Company has adopted a Non-Employee Director
Stock Option Plan (the "Director Plan") pursuant to which 937,500 shares of
Common Stock are reserved for issuance to non-employee directors. The Director
Plan provides that eligible directors automatically receive a grant of options
to purchase 10,000 shares of Common Stock upon first becoming a director and,
thereafter, an annual grant, in January of each year, of options to purchase
4,000 shares. All of such options are granted at fair market value on the date
of grant and are exercisable as to all of the shares covered thereby commencing
one year from the date of grant. To date, the Company has granted to each of
Messrs. Adams, Dick, Sands, Simon and Wagner options to purchase 98,625 shares
of Common Stock pursuant to the Director Plan and 10,000 shares of Common Stock
pursuant to the Company's 1996 Stock Option Plan and has granted Mr. Stuart
options to purchase 28,000 shares of Common Stock pursuant to the Director Plan.
During the year ended December 31, 1998, the Company granted options to purchase
4,000 shares, at an average exercise price of $14.38 per share (giving effect to
all stock splits), to each of Messrs. Adams, Dick, Sands, Simon, Stuart and
Wagner.
Effective January 1, 1999 all non-employee directors will receive
annual cash compensation of $30,000, payable in equal quarterly installments,
for services rendered in their capacity as Board members. In addition, members
of the Executive, Audit and Compensation Committees will be entitled to receive
annual payments of $6,400, $3,600 and $3,600, respectively, as members of such
committees. These payments are in addition to any stock options which may be
granted to non-employee directors.
STOCK OPTION PLANS
Effective July 1996, the Board of Directors of the Company adopted the
Company's 1996 Stock Option Plan pursuant to which 3,750,000 shares of Common
Stock are reserved for issuance at the discretion of the Compensation Committee
of the Board of Directors. To date, substantially all options to purchase Common
Stock available under this plan have been granted.
See "Proposal I" for a description of the Company's 1994 Stock Option Plan.
EMPLOYMENT AGREEMENTS
The Company has entered into five-year "evergreen" employment
agreements with each of Messrs. Laikin and Howell which are automatically
renewable for successive one-year periods and provide for an annual base
compensation of $200,000 and such bonuses as the Compensation Committee of the
Board of Directors may from time to time determine. If the Company provides the
employee with notice that it desires to terminate the agreement or terminates
the agreement without cause, there is a final five-year term commencing on the
date of such notice. The employment agreements provide for employment on a
full-time basis and contain a provision that the employee will not compete or
engage in a business competitive with the current or anticipated business of the
Company during the term of the employment agreement and for a period of two
years thereafter. The employment agreements also provide that if the employee's
employment is terminated under certain circumstances, including as a result of a
"change of control," the employee will be entitled to receive severance pay
equal to ten times the total compensation (including salary, bonus, the value of
all perquisites and the value of all stock options granted to the employee)
received from the Company during the twelve months prior to the date of
termination. In addition, the vesting of all options granted to the employee
will be accelerated so that the options become immediately exercisable. For
purposes of such agreements, a "change of control" shall be deemed to occur,
unless previously consented to in writing by the respective employee, upon (i)
the actual acquisition, or the execution of an agreement to acquire, 15% or more
of the voting securities of the Company by any person or entity not affiliated
with the respective employee (other than pursuant to a bona fide underwriting
agreement relating to a public distribution of securities of the Company), (ii)
the commencement of a tender or exchange offer for more than 15% of the voting
securities of the Company by any person or entity not affiliated with the
respective employee, (iii) the commencement of a proxy contest against
-12-
<PAGE> 16
management for the election of a majority of the Board of Directors of the
Company if the group conducting the proxy contest owns, has or gains the power
to vote at least 15% of the voting securities of the Company, (iv) a vote by the
Board of Directors to merge, consolidate or sell all or substantially all of the
assets of the Company to any person or entity not affiliated with the respective
employee, or (v) the election of directors constituting a majority of the Board
of Directors who have not been nominated or approved by the respective employee.
A change in control will not be deemed to have occurred if the acquisition of
15% or more of the Company's voting securities result from a combination of the
Company and another entity where either executive officers of the Company before
the combination constitute not less than 50% of the executive officers of the
Company after the combination or directors of the Company before the combination
constitute not less than 50% of the members of the Board of the Company after
the combination. In addition, the Company has entered into three-year
"evergreen" employment agreements with each of Messrs. Bounsall and Fivel, which
are automatically renewable for successive one-year periods, provide for an
annual base compensation of $175,000 for Mr. Bounsall and $150,000 for Mr. Fivel
as of January 1, 1999 and provide otherwise for substantially the same terms as
the employment agreements described above, except that if the employee's
employment is terminated under certain circumstances, including as a result of a
change of control, the employee will be entitled to receive severance pay equal
to three times the compensation received or earned from the Company during the
twelve months prior to the date of termination.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company has a Compensation Committee of the Board of Directors
comprised of non-employee directors and currently consisting of Messrs. Wagner
and Adams. Decisions as to executive compensation are made by the Board of
Directors, primarily upon the recommendation of such Committee. Mr. Wagner is a
partner in a law firm which received fees in exchange for services rendered to
the Company during the year ended December 31, 1998. The Board of Directors
which includes Messrs. Laikin and Howell has not modified or rejected any
recommendations of the Compensation Committee as to the compensation of the
Company's executive officers. During the fiscal year ended December 31, 1998,
none of the executive officers of the Company has served on the board of
directors or the compensation committee of any other entity, any of whose
officers serves on the Company's Board of Directors or Compensation Committee.
REPORT ON EXECUTIVE COMPENSATION
As noted above, compensation of the Company's executive officers is
determined by the Board of Directors pursuant to recommendations made by the
Compensation Committee. There is no formal compensation policy for the Company's
executive officers, other than the employment agreements described above.
Base Salary. Compensation for executive officers consists of base
salary, bonus and stock option awards. The base salary of the Company's
executives are fixed pursuant to the terms of their respective employment
agreements with the Company. The Compensation Committee reviews the salary of
executive officers for reasonableness based on job responsibilities and a
limited review of compensation practices for comparable positions at
corporations which compete with the Company in its business or are of comparable
size and scope of operations. The Committee's recommendations to the Board of
Directors are based primarily on informal judgments reasonably believed to be in
the best interests of the Company. In determining the base salaries of the
Company's executives during 1998, the Committee considered the Company's
significant growth and the expanded scope of the Company's operations. Salaries
are reevaluated by the Committee each year to determine whether such salaries
are reasonable in light of each executive's expected duties.
Bonuses. Bonuses for the Company's executive officers are not
determined through the use of specific criteria. Rather, the Committee bases
bonuses on the Company's overall performance, profitability, working capital
management and other qualitative and quantitative measurements. In determining
the amount of bonuses awarded, the Committee considers the Company's revenues
and profitability for the applicable period and each executive's contribution to
the success of the Company. In the first quarter of fiscal 1998 the Company's
executive officers received bonuses which were deemed appropriate based upon the
Company's operating results during the first quarter. During the remainder of
1998, no bonuses were paid to the Company's executive officers.
-13-
<PAGE> 17
Stock Options. Stock options awards under the Company's Employee Stock
Option Plan are intended to attract, retain and motivate personnel by affording
them an opportunity to receive additional compensation based upon the
performance of the Company's Common Stock. The size and grant of actual awards
during 1998 was determined by the Committee on an informal basis. The
Committee's determination as to the size of actual awards to individual
executives was subjective, after taking into account the relative
responsibilities and contributions of the individual executives. The number or
value of options or "restricted stock" currently held by an executive is not
taken into account in determining the number of stock options granted.
In reviewing Mr. Laikin's performance and determining compensation, the
Committee considered the Company's overall performance, including earnings per
share, revenue growth, enhancements in customer service and the significantly
expanded scope of the Company's operations. Mr. Laikin's base salary, bonus and
stock option awards for the year ended December 31, 1998 were based on the
Company's overall performance, with no component of such compensation based on
any particular measure of performance.
COMPENSATION COMMITTEE
Robert F. Wagner
John W. Adams
-14-
<PAGE> 18
STOCK PERFORMANCE GRAPH
The following line graph compares, from April 7, 1994, the first day on
which the Company's Common Stock was publicly traded, through December 31, 1998,
the cumulative total stockholder return on the Company's Common Stock with the
cumulative total return on the stocks comprising the NASDAQ Market Value Index
and the Media General Financial Services Electronics Wholesale Industry Group
Index ("MG Group Index"). During 1998, Media General Financial Services
restructured its industry group classification system replacing its former
Electronic Equipment Distributors group with the Electronics Wholesale Industry
Group. The Company believes that this restructuring did not materially effect
the applicable index. The comparison assumes $100 was invested on April 7, 1994
in the Company's Common Stock and in each of the foregoing indices and assumes
reinvestment of all cash dividends, if any, paid on such securities. The Company
has not paid any cash dividends and, therefore, the cumulative total return
calculation for the Company is based solely upon stock price appreciation and
not upon reinvestment of cash dividends. Historical stock price is not
necessarily indicative of future stock price performance.
<TABLE>
<CAPTION>
4/7/94 12/31/94 12/31/95 12/31/96 12/31/97 12/31/98
------- -------- -------- -------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Brightpoint, Inc................. $100.00 $248.00 $282.50 $892.05 $1,040.11 $1,030.73
MG Group Index................... $100.00 100.42 123.76 147.10 160.25 132.02
NASDAQ Market Value Index........ $100.00 102.34 132.74 164.95 201.77 284.58
</TABLE>
-15-
<PAGE> 19
VOTING SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
beneficial ownership of the Common Stock as of the Record Date, based on
information obtained from the persons named below, (i) by each person known by
the Company to own beneficially more than five percent of the Company's Common
Stock, (ii) by each of the Named Executives, (iii) by each of the Company's
directors, and (iv) by all executive officers and directors of the Company as a
group:
<TABLE>
<CAPTION>
NAME AND ADDRESS OF AMOUNT AND NATURE OF PERCENTAGE OF OUTSTANDING
BENEFICIAL OWNER(1) BENEFICIAL OWNERSHIP(2) SHARES OWNED
------------------- ----------------------- -------------------------
<S> <C> <C>
Robert J. Laikin(3).................................................. 1,410,047 2.6%
J. Mark Howell(4).................................................... 733,345 1.4%
Phillip A. Bounsall(5)............................................... 108,166 *
Steven E. Fivel(6)................................................... 75,916 *
Rollin M. Dick(7).................................................... 352,458 *
Steven B. Sands(8)................................................... 125,458 *
John W. Adams(9)..................................................... 45,708 *
Stephen H. Simon(10)................................................. 52,333 *
Robert F. Wagner(11)................................................. 33,733 *
Todd H. Stuart(12)................................................... 24,000 *
Dana E. Marlin(13)................................................... 150,000 *
T. Scott Housefield(14).............................................. -- *
T. Rowe Price Associates, Inc.(15)................................... 3,631,000 6.8%
Capital Research and Management Company(16).......................... 2,732,500 5.1%
SMALLCAP World Fund, Inc.(16)........................................ 2,732,500
5.1%
AMVESCAP PLC(17)..................................................... 4,079,980 7.7%
All executive officers and directors
as a group (ten persons)(18)........................................ 2,961,164 5.6%
</TABLE>
- ----------------------
* Less than 1%.
(1) The address for each of such individuals, unless specified otherwise in a
subsequent footnote, is in care of Brightpoint, Inc., 6402 Corporate Drive,
Indianapolis, Indiana 46278.
-16-
<PAGE> 20
(2) A person is deemed to be the beneficial owner of securities that can be
acquired by such person within 60 days from the Record Date upon the
exercise of options. Each beneficial owner's percentage ownership is
determined by assuming that options or warrants that are held by such
person (but not those held by any other person) and which are exercisable
within 60 days of the Record Date have been exercised. Unless otherwise
indicated, the Company believes that all persons named in the table have
sole voting and investment power with respect to all shares of Common Stock
beneficially owned by them.
(3) Includes 461,665 shares underlying options which are exercisable within 60
days of the Record Date. A total of 948,382 of Mr. Laikin's shares are
subject to call options sold by Mr. Laikin during 1997. A portion of these
options are exercisable on November 1, 1999 and the remainder are
exercisable on May 5, 2000. These options expire at the end of the day they
first become exercisable. Does not include options to purchase 816,665
shares.
(4) Includes 708,345 shares underlying options which are exercisable within 60
days of the Record Date. Does not include options to purchase 716,665
shares.
(5) Includes 104,166 shares underlying options which are exercisable within 60
days of the Record Date. Includes 4,000 shares owned by Mr. Bounsall's
wife. Does not include options to purchase 295,834 shares.
(6) Includes 72,916 shares underlying options which are exercisable within 60
days of the Record Date. Does not include options to purchase 204,584
shares.
(7) Includes: (i) 46,875 shares held in the name of Rollin M. Dick, (ii)
150,000 shares held in the name of Rollin M. Dick 1998 Grantor Retained
Annuity Trust of which Mr. Dick is a trustee, (iii) 104,500 shares held by
the Helping Fund, a charitable organization established under Section
501(c)(3) of the Code, of which Mr. Dick is a trustee, and (iv) 51,083
shares underlying options which are exercisable within 60 days of the
Record Date. Does not include (i) 629,874 shares held of record by the
Rollin M. Dick and Helen E. Dick 1996 GRAT Irrevocable Trust II of which
shares of Mr. Dick's wife as trustee has voting and dispositive power but
as to which Mr. Dick disclaims beneficial ownership and (ii) options to
purchase 10,667 shares.
(8) Includes: (i) 7,500 shares held by Ponderosa Partners, L.P., of which Mr.
Sands is a general partner, (ii) 20,000 shares held by Katie & Adam Bridge
Partners, L.P., of which Mr. Sands is the president of the corporate
general partner, and (iii) 51,083 shares underlying options which are
exercisable within 60 days of the Record Date. Does not include options to
purchase 10,667 shares.
(9) Includes 32,333 shares underlying options which are exercisable within 60
days of the Record Date. Does not include options to purchase 10,667
shares.
(10) Includes 17,333 shares underlying options which are exercisable within 60
days of the Record Date. Does not include options to purchase 10,667
shares.
(11) Includes 32,333 shares underlying options which are exercisable within 60
days of the Record Date. Does not include options to purchase 10,667
shares.
(12) Represents shares underlying options which are exercisable within 60 days
of the Record Date. Does not include options to purchase 4,000 shares.
(13) Represents shares underlying options which are exercisable within 60 days
of the Record Date. Mr. Marlin ceased to be an officer and employee of the
Company effective as of June 30, 1998.
(14) Mr. Housefield ceased to be an officer, director and employee of the
Company effective as of November 2, 1998.
-17-
<PAGE> 21
(15) Based solely on a Schedule 13G filed by T. Rowe Price Associates, Inc.
("Price Associates") with the Commission, these securities are owned by
various individuals and institutional investors which Price Associates
serves as investment advisor with power to direct investments and/or sole
power to vote the securities. For the purposes of the reporting
requirements of the Securities Exchange Act of 1934, Price Associates is
deemed to be a beneficial owner of such securities; however, Price
Associates expressly disclaims that it is, in fact, the beneficial owner of
such securities. The address of Price Associates is 100 E. Pratt Street,
Baltimore, Maryland 21202.
(16) Based solely on a joint Schedule 13G filed with the Commission by Capital
Research and Management Company ("CRMC") and SMALLCAP World Fund, Inc.
("SWF"), CRMC, an investment advisor registered under the Investment
Adviser Act of 1940, is deemed to be the beneficial owner of such shares,
which are also beneficially owned by SWF, as a result of CRMC acting as an
investment advisor to SWF, an investment company registered under the
Investment Company Act of 1940. The address of CMRC and SWF is 333 South
Hope Street, Los Angeles, California 90071.
(17) Based solely on Schedule 13G filed with the Commission by AMVESCAP PLC, a
parent holding company, as part of a group consisting of itself and the
following subsidiaries: AVZ, Inc., Aim Management Group Inc., AMVESCAP
Group Services, Inc., INVESCO Inc., INVESCO North America Holding, Inc.,
INVESCO Funds Group, Inc. and INVESCO Management & Research, Inc. with
respect to the group's shares voting and dispositive power over the shares.
The principal business address for AMVESCAP PLC is 11 Devonshire Square,
London EC2M 4YR, England.
(18) Includes an aggregate of 1,555,257 shares underlying options which are
exercisable within 60 days of the Record Date, including those listed in
notes (3) through (12), above.
CERTAIN TRANSACTIONS
The Company utilizes the services of a third party for the purchase of
corporate gifts, promotional items and standard and personalized corporate
stationery. Mrs. Judy Laikin, the mother of Robert J. Laikin, owns this
advertising specialty company. For the year ended December 31, 1998, the Company
purchased approximately $ 288,677 of services and products from this party. The
Company believes these purchases by the Company were made on terms no less
favorable than could be made from an unrelated party.
The Company may provide product distribution, fulfillment and other
integrated logistics services to a privately-held company that proposes to
engage in the business of selling wireless communication products and related
accessories through the Internet. Although there is currently no agreement
between the Company and this entity, such an agreement may exist in the future.
Messrs. Laikin and Howell are directors and stockholders and certain of the
Company's officers and directors are stockholders of this entity.
Mr. Robert F. Wagner is a Partner of the Law Firm of Lewis & Wagner
which received fees in exchange for legal services rendered to the Company
during the year ended December 31, 1998. The Company believes that the fees paid
for services rendered by Lewis & Wagner were substantially the same as those
that would have been incurred had the legal services been rendered by an
unrelated party.
-18-
<PAGE> 22
PROPOSAL I
AMENDMENT OF 1994 STOCK OPTION PLAN TO INCREASE
THE TOTAL NUMBER OF SHARES RESERVED FOR
ISSUANCE THEREUNDER FROM 8,200,000 TO 10,500,000
At the Annual Meeting, the Company's stockholders will be
asked to approve an amendment to the Company's 1994 Stock Option Plan (the
"Plan") to increase the total number of shares of Common Stock reserved to date
for issuance under the Plan from 8,200,000 to 10,500,000. The Plan contains
anti-dilution provisions authorizing appropriate adjustments in certain
circumstances. Shares of Common Stock subject to options which expire without
being exercised or which are cancelled as a result of the cessation of
employment are available for further grants. No shares of Common Stock of the
Company may be issued to any optionee until the full option price has been paid.
The Committee may grant individual options under the Plan with more stringent
provisions than those specified in the Plan. The text of the 1994 Stock Option
Plan, pursuant to the proposed amendment, has been filed electronically with the
SEC, but is not included in the printed version of the Proxy Statement. A copy
of the 1994 Stock Option Plan is available from the Company's Secretary at 6402
Corporate Drive, Indianapolis, Indiana 46278.
The Board believes that in order to enable the Company to
continue to attract and retain personnel of the highest caliber, provide
incentive for officers, directors, key employees and other key persons and
continue to promote the well-being of the Company, it is in the best interest of
the Company and its stockholders to provide to officers, directors, key
employees, consultants and other independent contractors who perform services
for the Company, through the granting of stock options, the opportunity to
participate in the value and/or appreciation in value of the Company's Common
Stock. The Board has found that the grant of options under the Plan has proven
to be a valuable tool in attracting and retaining key employees. It believes
that such authority, in view of the substantial growth of the Company and need
to continue to grow, should be expanded to increase the number of options which
may be granted under the Plan. The Board believes that such authority will
provide the Company with significant means to attract and retain talented
personnel and maintain current key employees.
SUMMARY OF THE 1994 STOCK OPTION PLAN
In March 1994, the Company adopted the Plan, as amended in May
1995 and in April 1997, pursuant to which, after adjusting for stock splits,
8,200,000 shares of Common Stock are currently reserved for issuance upon the
exercise of options designated as either (i) options intended to constitute
incentive stock options ("ISOs") under the Internal Revenue Code of 1986, as
amended (the "Code") or (ii) nonqualified options. ISOs may be granted under the
Plan to employees and officers of the Company. Non-qualified options may be
granted to consultants, directors (whether or not they are employees), employees
or officers of the Company.
The Plan is intended to qualify under Rule 16b-3 under the
Securities Exchange Act of 1934, and is administered by a Committee of the Board
of Directors, which currently consists of Messrs. Wagner and Adams. The
Committee, within the limitations of the Plan and subject to the restrictions on
repricing of options set forth below, determines the persons to whom options
will be granted, the number of shares to be covered by each option, whether the
options granted are intended to be ISOs, the duration and rate of exercise of
each option, the option purchase price per share and the manner of exercise, and
the time, manner and form of payment upon exercise of an option. Unless sooner
terminated the Plan will expire at the close of business on April 7, 2004. The
Board of Directors has determined to limit the total number of options under the
Plan whose exercise price may be repriced from the original exercise price
(other than as a result of the anti-dilution provisions of the Plan) to not more
than 10% of the total number of shares of Common Stock reserved for issuance
under the Plan.
-19-
<PAGE> 23
ISOs granted under the Plan may not be granted at a price less
than the fair market value of the Common Stock on the date of grant (or 110% of
fair market value in the case of persons holding 10% or more of the voting stock
of the Company). The aggregate fair market value of shares for which ISOs
granted to any employee are exercisable for the first time by such employee
during any calendar year (under all stock option plans of the Company) may not
exceed $100,000. Non-qualified options granted under the Plan may not be granted
at a price less than the fair market value of the Common Stock on the date of
grant. Options granted under the Plan will expire not more than ten years from
the date of grant (five years in the case of ISOs granted to persons holding 10%
or more of the voting stock of the Company). Except as provided by the Board of
Directors or Committee, as the case may be, all options granted under the Plan
are not transferable during an optionee's lifetime but are transferable at death
by will or by the laws of descent and distribution. In general, upon termination
of employment of an optionee, all options granted to such person which are not
exercisable on the date of such termination immediately terminate, and any
options that are exercisable terminate 90 days following termination of
employment.
The Plan contains anti-dilution provisions authorizing
appropriate adjustments in certain circumstances. Shares of Common Stock subject
to options which expire without being exercised or which are cancelled as a
result of the cessation of employment are available for further grants. No
shares of Common Stock of the Company may be issued to any optionee until the
full option price has been paid. The Committee may grant individual options
under the Plan with more stringent provisions than those specified in the Plan.
Under the Plan, as currently in effect, the maximum number of
shares that may be covered by stock options granted to any employee of the
Company shall be a maximum of 50% of the aggregate number of shares reserved for
issuance under the Plan. Such requirement is intended to meet the exception from
Section 162(m) of the Code for performance-based compensation.
The market price of the Common Stock was $5.94 as reported by
the NASDAQ Stock Market as of the close of trading on April 12, 1999.
-20-
<PAGE> 24
PARTICIPATION IN THE 1994 STOCK OPTION PLAN
The following table sets forth certain information regarding options to
purchase Common Stock issued (net of cancelled options) since the inception of
the Plan to each of the Named Executives who participated in the Plan, all
current executive officers as a group, all current directors who are not
executive officers as a group and all employees, including employees who are not
executive officers, who participated in the Stock Plan as a group. No associate
of any director or officer has received options under the Plan.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING OPTIONS
------------------
<S> <C>
Robert J. Laikin 1,355,314
J. Mark Howell 1,135,940
Phillip A. Bounsall 275,000
Steven E. Fivel 215,000
Dana E. Marlin 294,250
T. Scott Housefield 301,042
All current executive officers as a group (4 persons) 2,981,254
Non-employee directors as a group (6 persons) --
All non-executive officer employees as a group (137 persons) 4,573,731
</TABLE>
CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE PLAN
The following is a brief summary of the Federal income tax
aspects of grants made under the Plan based upon statutes, regulations and
interpretations in effect on the date hereof. This summary is not intended to be
exhaustive, and does not describe foreign, state or local tax consequences.
1. Incentive Stock Options. The participant will recognize no
taxable income upon the grant or exercise of an Incentive Stock Option. Upon a
disposition of the shares after the later of two years from the date of grant
and one year after the transfer of the shares to the participant, (i) the
participant will recognize the difference, if any, between the amount realized
and the exercise price as long-term capital gain or long-term capital loss (as
the case may be) if the shares are capital assets in his or her hands; and (ii)
the Company will not qualify for any deduction in connection with the grant or
exercise of the options. The excess, if any, of the fair market value of the
shares on the date of exercise of an Incentive Stock Option over the exercise
price will be treated as an item of adjustment for his or her taxable year in
which the exercise occurs and may result in an alternative minimum tax liability
for the participant. In the case of a disposition of shares in the same taxable
year as the exercise where the amount realized on the disposition is less than
the fair market value of the shares on the date of exercise, there will be no
adjustment since the amount treated as an item of adjustment, for alternative
minimum tax purposes, is limited to the excess of the amount realized on such
disposition over the exercise price which is the same amount included in regular
taxable income.
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If Common Stock acquired upon the exercise of an Incentive
Stock Option is disposed of prior to the expiration of the holding periods
described above, (i) the participant will recognize ordinary compensation income
in the taxable year of disposition in an amount equal to the excess, if any, of
the lesser of the fair market value of the shares on the date of exercise or the
amount realized on the disposition of the shares, over the exercise price paid
for such shares; and (ii) the Company will qualify for a deduction equal to any
such amount recognized, subject to the requirements of Section 162(m) of the
Code and that the compensation be reasonable. The participant will recognize the
excess, if any, of the amount realized over the fair market value of the shares
on the date of exercise, if the shares are capital assets in his or her hands,
as short-term or long-term capital gain, depending on the length of time that
the participant held the shares, and the Company will not qualify for a
deduction with respect to such excess.
Subject to certain exceptions for disability or death, if an
Incentive Stock Option is exercised more than three months following the
termination of the participant's employment, the option will generally be taxed
as a Non-Qualified Stock Option. See "Non-Qualified Stock Options."
2. Non-Qualified Stock Options. With respect to Non-Qualified
Stock Options (i) upon grant of the option, the participant will recognize no
income; (ii) upon exercise of the option (if the shares are not subject to a
substantial risk of forfeiture), the participant will recognize ordinary
compensation income in an amount equal to the excess, if any, of the fair market
value of the shares on the date of exercise over the exercise price, and the
Company will qualify for a deduction in the same amount, subject to the
requirements of Section 162(m) of the Code and that the compensation be
reasonable; (iii) the Company will be required to comply with applicable Federal
income tax withholding requirements with respect to the amount of ordinary
compensation income recognized by the participant; and (iv) on a sale of the
shares, the participant will recognize gain or loss equal to the difference, if
any, between the amount realized and the sum of the exercise price and the
ordinary compensation income recognized. Such gain or loss will be treated as
short-term or long-term capital gain or loss if the shares are capital assets in
the participant's hands depending upon the length of time that the participant
held the shares.
The approval of the proposed amendment to the Company's 1994
Stock Option Plan requires the affirmative vote of a majority of the shares of
Common Stock present in person or represented by proxy at the Annual Meeting,
provided a quorum exists.
THE BOARD BELIEVES THAT THE PROPOSED AMENDMENT TO THE 1994
STOCK OPTION PLAN WILL HELP THE COMPANY ATTRACT AND RETAIN QUALIFIED OFFICERS,
DIRECTORS AND KEY EMPLOYEES. ACCORDINGLY, THE BOARD BELIEVES THAT THE AMENDMENT
TO THE 1994 STOCK OPTION PLAN IS IN THE BEST INTEREST OF THE COMPANY AND
UNANIMOUSLY RECOMMENDS A VOTE FOR ITS APPROVAL.
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PROPOSAL II
APPROVAL OF THE BRIGHTPOINT, INC. 1999 EMPLOYEE STOCK PURCHASE PLAN
On March 26, 1999, the Board of Directors of the Company, subject to
shareholder approval, adopted the Brightpoint, Inc. 1999 Employee Stock Purchase
Plan (the "Purchase Plan"), to be effective as of July 1, 1999. The text of the
Purchase Plan, as proposed, has been filed electronically with the Securities
Exchange Commission, but is not included in the printed version of the Proxy
Statement. A copy of the Purchase Plan is available from the Company's Secretary
at 6402 Corporate Drive, Indianapolis, Indiana 46278. The principal features of
the Purchase Plan are summarized below.
GENERAL DESCRIPTION
The purpose of the Purchase Plan is to further the long-term stability and
financial success of the Company by providing a method for employees to increase
their ownership in the Company's Common Stock. The Purchase Plan is intended to
qualify under section 423 of the Code. The Purchase Plan reserves 2,000,000
shares of Common Stock for issuance and sale under the Purchase Plan. Unless
sooner terminated by the Board of Directors and subject to other provisions in
the Purchase Plan, the Purchase Plan will terminate at the close of business on
June 30, 2010.
ELIGIBILITY
Any person who is an "Eligible Employee" may participate in the Purchase
Plan. "Eligible Employee" means any employee of the Company or of any
Participating Subsidiary, except for any employee who has not as of the Grant
Date completed at least 6 months of continuous full-time employment or whose
customary employment is less than 20 hours per week. No employee will be
eligible if he or she is an owner of 5% or more of the stock of the Company or
an affiliated company as determined under Section 423(b)(3) of the Code. The
Company presently has approximately 1,500 employees who would be eligible to
participate in the Purchase Plan.
ADMINISTRATION
The Board will appoint a committee ("Committee") to supervise and
administer the Purchase Plan with full power and discretion to adopt, amend and
rescind any rules deemed desirable and appropriate for the administration of the
Purchase Plan. The Committee will have full power and discretionary authority to
construe and interpret the terms and conditions of the Purchase Plan. The
composition of the Committee shall be in accordance with the requirements to
obtain or retain any available exemption from Section 16(b) of the Securities
Exchange Act of 1934, as amended.
OPERATION OF THE PURCHASE PLAN
An Eligible Employee may elect to become a Participant on any Grant Date
occurring on or after the date he first becomes eligible to participate in the
Purchase Plan. To begin participation, an Eligible Employee must complete a
Subscription Agreement. The Grant Date is the first business day of each month.
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A Participant in the Purchase Plan may authorize payroll deductions of a
maximum of 10% and a minimum of 1% of compensation, up to a maximum annual
deduction of $2,000. The amounts so deducted and contributed are applied to the
purchase of full and fractional shares of Common Stock on the Exercise Date (the
first business date after the end of a month) at the lesser of: (i) 85% of the
Fair Market Value of a Share on the first trading day of the month, or (ii) 85%
of the Fair Market Value of a Share on the last trading day of the applicable
month. During any one calendar year, a Participant may not purchase under the
Purchase Plan, or any other plan qualified under Section 423 of the Code, Shares
having a Fair Market Value in excess of $25,000.
It is contemplated the shares of Common Stock required for the Purchase
Plan will be purchased from the Company, but, if the Committee deems it to be
appropriate, the Committee may appoint an agent to make purchases of Shares on
the open market or in private transactions, in which case the Company will make
up the difference between the open market or private transaction purchase price
and the price at which the Shares will be purchases for Participants.
ADJUSTMENTS OF AND CHANGES IN THE SHARES
In the event that the Shares shall be changed into or exchanged for a different
number or kind of shares of stock or other securities of the Company or of
another corporation (whether by reason or merger, consolidation,
recapitalization, combination of shares, or otherwise), or if the number of
Shares shall be increased through a stock split or the payment of a stock
dividend, there shall be substituted for or added to each Share theretofore
reserved for sale under the Purchase Plan. The number and kind of shares of
stock or other securities into which each outstanding Share shall be so changed,
or for which each such Share shall be exchanged, or to which each such Share is
entitled, as the case may be, for the number or kind of securities which may be
sold under the Purchase Plan and the purchase price per Share shall be
appropriately adjusted consistent with such change in such manner as the
Committee (or its delegate) may deem equitable to prevent substantial dilution
of enlargement of rights granted to, or available for, Eligible Employees under
the Purchase Plan. In making any adjustments hereunder, or in determining that
no such adjustments are necessary, the Committee may rely upon the advice of
either or both of legal counsel and independent accountants.
AMENDMENTS
The Board may at any time in its discretion modify or amend, in whole or in
part, any provision of or otherwise alter, suspend or terminate the Purchase
Plan as it may deem advisable. Notwithstanding the foregoing, no such Board
action may, without the consent of an Eligible Employee, adversely affect any
Option theretofore granted to an Eligible Employee.
FEDERAL INCOME TAX CONSEQUENCES OF THE PURCHASE PLAN
The Purchase Plan is intended to qualify as an employee stock purchase plan
under section 423 of the Code. Participants will be taxed on amounts withheld
for the purchase of Common Stock as if such amounts were actually received.
Participants will not recognize income upon the purchase of Shares under the
Purchase Plan, but will recognize income or loss upon the disposition of such
Shares and on any Shares held at death. The amount and nature of income
recognized upon disposition of the Shares will depend upon the holding period of
the purchased shares.
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<PAGE> 28
If Shares are disposed of more than two years after the granting of an
Option to purchase such Shares and at least one year after such Shares are
transferred to the Participant, or if the Participant holds Common Stock at the
time of his or her death, the participant will recognize ordinary income in an
amount equal to the lesser of: (a) the excess of the fair market value of the
Common Stock at the time of such disposition or death over the purchase price of
such shares, or (b) the excess of the fair market value of the Common Stock at
the time the option was granted over the purchase price of such shares. Any
further gain will be taxed as a long-term capital gain. Long-term capital gains
currently are subject to lower tax rates than ordinary income. At the present
time, the maximum federal income tax rate for net long-term capital gains over
net short-term capital losses is 20% while the maximum ordinary income rate is
39.6%.
If the Shares are sold or disposed of within two years after the granting
of the option to purchase such shares or within one year after such shares are
transferred to the participant (a "disqualifying disposition"), then the excess
of the fair market value of the Shares on the purchase date over the purchase
price will be treated as ordinary income at the time of such disposition. The
balance of any gain will be treated as capital gain. If the Shares are disposed
of pursuant to a disqualifying disposition for less than its fair market value
on the purchase date, the participant must still recognize ordinary income in an
amount equal to the excess of the fair market value of the Shares on the
purchase date over the purchase price, and recognize a capital loss in an amount
equal to the difference between the sale price of the Shares over its fair
market value on the purchase date. Capital gain or loss will be long-term or
short-term depending on whether the stock has been held for more than one year.
The Company is generally not entitled to a deduction with respect to
purchases of Shares under the Purchase Plan, unless an employee disposes of the
Shares in a disqualifying disposition. The Company is entitled to a deduction in
computing its federal income taxes for the year of a disqualifying disposition
in an amount equal to any amount taxable to the employee as ordinary income.
This summary of federal income tax consequences does not purport to be
complete. Reference should be made to applicable provisions of the Code. In
addition, there may also be foreign, state and local income tax consequences
applicable to transactions contemplated by the Purchase Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE BRIGHTPOINT,
INC. 1999 EMPLOYEE STOCK PURCHASE PLAN.
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<PAGE> 29
INDEPENDENT AUDITORS
The Company has engaged Ernst & Young LLP as its independent auditors since
October 1994. Ernst & Young LLP reported on the financial statements of the
Company for the fiscal year ended December 31, 1998 and it is currently
anticipated that Ernst & Young LLP will be selected by the Board of Directors to
audit and report on the financial statements of the Company for the year ending
December 31, 1999. Representatives of Ernst & Young LLP are expected to be
present at the Annual Meeting, will have the opportunity to make a statement if
they desire to do so, and are expected to be available to respond to appropriate
questions.
STOCKHOLDER PROPOSALS FOR NEXT ANNUAL MEETING
Stockholders who wish to present proposals appropriate for consideration at
the Company's Annual Meeting of Stockholders for its fiscal year ending December
31, 1999 to be held in the year 2000 must submit the proposal in proper form to
the Secretary of the Company at its address set forth on the first page of this
Proxy Statement (or such other address as then constitutes its executive
offices) not later than December 8, 1999 in order for the proposition to be
considered for inclusion in the Company's proxy statement and form of proxy
relating to such annual meeting. Such proposals must be presented in a manner
consistent with the Company's By-Laws and applicable laws. Any such proposals,
as well as any questions related thereto, should be directed to the Secretary of
the Company.
OTHER INFORMATION
A copy of the Company's 1998 Annual Report to Stockholders is being
furnished herewith to each stockholder of record as of the close of business on
April 8, 1999. Copies of the Company's Annual Report on Form 10-K will be
provided upon written request to the Company at 6402 Corporate Drive,
Indianapolis, Indiana 46278, Attention Investor relations. Form 10-K also is
available on the Company's website at www.brightpoint.com.
The Board of Directors is aware of no other matters, except for those
incident to the conduct of the Annual Meeting, that are to be presented to
stockholders for formal action at the Annual Meeting. If, however, any other
matters properly come before the Annual Meeting or any adjournments thereof, it
is the intention of the persons named in the proxy to vote the proxy in
accordance with their judgment.
By order of the Board of Directors,
/s/ STEVEN E. FIVEL
Steven E. Fivel
Secretary
April 15, 1999
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APPENDIX A
1994 STOCK OPTION PLAN
OF
BRIGHTPOINT, INC.
(as amended)
1. PURPOSE
Brightpoint, Inc. (the "Company") desires to attract and retain the
best available talent and encourage the highest level of performance in order to
continue to serve the best interests of the Company, and its stockholders. By
affording key personnel the opportunity to acquire proprietary interests in the
Company and by providing them incentives to put forth maximum efforts for the
success of the business, the 1994 Stock Option Plan of Brightpoint, Inc. (the
"1994 Plan") is expected to contribute to the attainment of those objectives.
The word "Subsidiary" or "Subsidiaries" as used herein, shall mean any
corporation, fifty percent or more of the voting stock of which is owned by the
Company.
2. SCOPE AND DURATION
Options under the 1994 Plan may be granted in the form of incentive
stock options ("Incentive Options") as provided in Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"), or in the form of nonqualified
stock options ("Non-Quali fied Options"). (Unless otherwise indicated,
references in the 1994 Plan to "options" include Incentive Options and
Non-Qualified Options.) The maximum aggregate number of shares as to which
options may be granted from time to time under the 1994 Plan is 10,500,000
shares of the Common Stock of the Company ("Common Stock"), which shares may be,
in whole or in part, authorized but unissued shares or shares reacquired by the
Company. The maximum number of shares with respect to which options may be
granted to any employee during the term of the Plan is 50% of the aggregate
number of shares reserved for issuance under the Plan. If an option shall
expire, terminate or be surrendered for cancellation for any reason without
having been exercised in full, the shares represented by the option or portion
thereof not so exercised shall be granted hereunder after that date.
<PAGE> 31
3. ADMINISTRATION
The 1994 Plan shall be administered by the Board of Directors of the
Company, or, at their discretion, by a committee which is appointed by the Board
of Directors to perform such function (the "Committee"). The Committee shall
consist of not less than two members of the Board of Directors, each of whom
shall serve at the pleasure of the Board of Directors and shall be any person
permitted under the provisions of Rule l6b-3 pursuant to the Securities Exchange
Act of 1934 (the "Act"). Vacancies occurring in the membership of the Committee
shall be filled by appointment by the Board of Directors.
The Board of Directors or the Committee, as the case may be, shall
have plenary authority in its discretion, subject to and not inconsistent with
the express provisions of the 1994 Plan, to grant options, to determine the
purchase price of the Common Stock covered by each option, the term of each
option, the persons to whom, and the time or times at which, options shall be
granted and the number of shares to be covered by each option; to designate
options as Incentive Options or Non-Qualified Options; to interpret the 1994
Plan; to prescribe, amend and rescind rules and regulations relating to the 1994
Plan; to determine the terms and provisions of the option agreements (which need
not be identical) entered into in connection with options under the 1994 Plan;
and to make all other determinations deemed necessary or advisable for the
administration of the 1994 Plan. The Board of Directors or the Committee, as the
case may be, may delegate to one or more of its members or to one or more agents
such administrative duties as it may deem advisable, and the Board of Directors
or the Committee, as the case may be, or any person to whom it has delegated
duties as aforesaid may employ one or more persons to render advice with respect
to any responsibility the Board of Directors or the Committee, as the case may
be, or such person may have under the 1994 Plan.
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<PAGE> 32
4. ELIGIBILITY; FACTORS TO BE CONSIDERED IN GRANTING OPTIONS
Incentive Options shall be limited to persons who are employees of the
Company or its present and future Subsidiaries and at the date of grant of any
option are in the employ of the Company or its present and future Subsidiaries.
In determining the employees to whom Incentive Options shall be granted and the
number of shares to be covered by each Incentive Option, the Board of Directors
or the Committee, as the case may be, shall take into account the nature of
employees' duties, their present and potential contributions to the success of
the Company and such other factors as it shall deem relevant in connection with
accomplishing the purposes of the 1994 Plan. An employee who has been granted an
option or options under the 1994 Plan may be granted an additional option or
options, subject, in the case of Incentive Options, to such limitations as may
be imposed by the Code on such options. Except as provided below, a
Non-Qualified Option may be granted to any person, including, but not limited
to, employees, independent agents, consultants and attorneys, who the Board of
Directors or the Committee, as the case may be, believes has contributed, or
will contribute, to the success of the Company.
5. OPTION PRICE
The purchase price of the Common Stock covered by each option shall be
determined by the Board of Directors or the Committee, as the case may be, shall
not be less than 100% of the Fair Market Value (as defined in paragraph 15
below) of a share of the Common Stock on the date on which the option is
granted. Such price shall be subject to adjustment as provided in paragraph 12
below. The Board of Directors or the Committee, as the case may be, shall
determine the date on which an option is granted; in the absence of such a
determination, the date on which the Board of Directors or the Committee, as the
case may be, adopts a resolution granting an option shall be considered the date
on which such option is granted.
6. TERM OF OPTIONS
The term of each option shall be not more then ten years from the date
of grant, as the Board of Directors or the Committee, as the case may be, shall
determine, subject to earlier termination as provided in paragraphs 10 and 11
below.
7. EXERCISE OF OPTIONS
(a) Subject to the provisions of the 1994 Plan and unless otherwise
provided in the option agreement, options granted under the 1994 Plan shall
become exercisable as determined by the Board of Directors or Committee. In its
discretion, the Board of Directors or the Committee, as the case may be, may, in
any case or cases, prescribe that options granted under the 1994 Plan become
exercisable in installments or provide that an option may be exercisable in full
immediately upon the date of its grant. The Board of Directors or the Committee,
as the case may be, may, in
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<PAGE> 33
its sole discretion, also provide that an option granted pursuant to the 1994
Plan shall immediately become exercisable in full upon the happening of any of
the following events; (i) the first purchase of shares of Common Stock pursuant
to a tender offer or exchange offer (other than an offer by the Company) for
all, or any part of, the Common Stock, (ii) the approval by the stockholders of
the Company of an agreement for a merger in which the Company will not survive
as an independent, publicly owned corporation, a consolidation, or a sale,
exchange or other disposition of all or substantially all of the Company's
assets, (iii) with respect to an employee, on his 65th birthday, or (iv) with
respect to an employee, on the employee's involuntary termination from
employment, except as provided in Section 10 herein. In the event of a question
or controversy as to whether or not any of the events hereinabove described has
taken place, a determination by the Board of Directors or the Committee, as the
case may be, that such event has or has not occurred shall be conclusive and
binding upon the Company and participants in the 1994 Plan.
(b) Any option at any time granted under the 1994 Plan may contain a
provision to the effect that the optionee (or any persons entitled to act under
Paragraph 11 hereof) may, at any time at which Fair Market Value is in excess of
the exercise price and prior to exercising the option, in whole or in part,
request that the Company purchase all or any portion of the option as shall then
be exercisable at a price equal to the difference between (i) an amount equal to
the option price multiplie by the number of shares subject to that portion of
the option in respect of which such request shall be made and (ii) an amount
equal to such number of shares multiplied by the fair market value of the
Company's Common Stock (within the meaning of Section 422 of the Code and the
treasury regulations promulgated thereunder) on the date of purchase. The
Company shall have no obligation to make any purchase pursuant to such request,
but if it elects to do so, such portion of the option as to which the request is
made shall be surrendered to the Company. The purchase price for the portion of
the option to be so surrendered shall be paid by the Company, at the election of
the Board of Directors or the Committee, as the case may be, either in cash or
in shares of Common Stock (valued as of the date and in the manner provided in
clause (ii) above), or in any combination of cash and Common Stock, which may
consist, in whole or in part, of shares of authorized but unissued Common Stock
or shares of Common Stock held in the Company's treasury. No fractional share of
Common Stock shall be issued or transferred and any fractional share shall be
disregarded. Shares covered by that portion of any option purchased by the
Company pursuant hereto and surrendered to the Company shall not be available
for the granting of further options under the Plan. All determinations to be
made by the Company hereunder shall be made by the Board of Directors or the
Committee, as the case may be.
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<PAGE> 34
(c) An option may be exercised, at any time or from time to time
(subject, in the case of Incentive Options, to such restrictions as may be
imposed by the Code), as to any or all full shares as to which the option has
become exercisable until the expiration of the period set forth in Paragraph 6
hereof, by the delivery to the Company, at its principal place of business, of
(i) written notice of exercise in the form specified by the Board of Directors
or the Committee, as the case may be, specifying the number of shares of Common
Stock with respect to which the option is being exercised and signed by the
person exercising the option as provided herein, (ii) payment of the purchase
price; and (iii) in the case of Non-Qualified Options, payment in cash of all
withholding tax obligations imposed on the Company by reason of the exercise of
the option. Upon acceptance of such notice, receipt of payment in full, and
receipt of payment of all withholding tax obligations, the Company shall cause
to be issued a certificate representing the shares of Common Stock purchased. In
the event the person exercising the option delivers the items specified in (i)
and (ii) of this Subsection (c), but not the item specified in (iii) hereof, if
applicable, the option shall still be considered exercised upon acceptance by
the Company for the full number of shares of Common Stock specified in the
notice of exercise but the actual number of shares issued shall be reduced by
the smallest number of whole shares of Common Stock which, when multiplied by
the Fair Market Value of the Common Stock as of the date the option is
exercised, is sufficient to satisfy the required amount of withholding tax.
(d) The purchase price of the shares as to which an option is
exercised shall be paid in full at the time of exercise. Payment shall be made
in cash, which may be paid by check or other instrument acceptable to the
Company; in addition, subject to compliance with applicable laws and regulations
and such conditions as the Board of Directors or the Committee, as the case may
be, may impose, the Board of Directors or the Committee, as the case may be, in
its sole discretion, may on a case-by-case basis elect to accept payment in
shares of Common Stock of the Company which are already owned by the option
holder, valued at the Fair Market Value thereof (as defined in paragraph 15
below) on the date of exercise; provided, however, that with respect to
Incentive Options, no such discretion may be exercised unless the option
agreement permits the payment of the purchase price in that manner.
(e) Except as provided in paragraphs 10 and 11 below, no option
granted to an employee may be exercised at any time by such employee unless such
employee is then an employee of the Company or a Subsidiary.
8. INCENTIVE OPTIONS
(a) With respect to Incentive Options granted, the aggregate Fair
Market Value (determined in accordance with the provisions of paragraph 15 at
the time the Incentive Option is granted) of the Common Stock or any other stock
of the Company or its current or future Subsidiaries with respect to which
incentive
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<PAGE> 35
stock options, as defined in Section 422 of the Code, are exercisable for the
first time by any employee during any calendar year (under all incentive stock
option plans of the Company and its parent and subsidiary corporation's, as
those terms are defined in Section 424 of the Code) shall not exceed $100,000.
(b) No Incentive Option may be awarded to any employee who immediately
prior to the date of the granting of such Incentive Option owns more than 10% of
the combined voting power of all classes of stock of the Company or any of its
Subsidiaries unless the exercise price under the Incentive Option is at least
110% of the Fair Market Value and the option expires within 5 years from the
date of grant.
(c) In the event of amendments to the Code or applicable regulations
relating to Incentive Options subsequent to the date hereof, the Company may
amend the provisions of the 1994 Plan, and the Company and the employees holding
options may agree to amend outstanding option agreements, to conform to such
amendments
9. NON-TRANSFERABILITY OF OPTIONS
Except as provided by the Board of Directors or Committee, as the case
may be, options granted under the 1994 Plan shall not be transferable otherwise
than by will or the laws of descent and distribution, and options may be
exercised during the lifetime of the optionee only by the optionee. No transfer
of an option by the optionee by will or by the laws of descent and distribution
shall be effective to bind the Company unless the Company shall have been
furnished with written notice thereof and a copy of the will and such other
evidence as the Company may deem necessary to establish the validity of the
transfer and the acceptance by the transferor or transferees of the terms and
conditions of such option.
10. TERMINATION OF EMPLOYMENT
In the event that the employment of an employee to whom an option has
been granted under the 1994 Plan shall be terminated (except as set forth in
paragraph 11 below), such option may be, subject to the provisions of the 1994
Plan, exercised (to the extent that the employee was entitled to do so at the
termination of his employment) at any time within three (3) months after such
termination, but not later than the date on which the option terminates;
provided, however, that any option which is held by an employee whose employment
is terminated for cause or voluntarily without the consent of the Company shall,
to the extent not theretofore exercised, automatically terminate as of the date
of termination of employment. As used herein, "cause" shall mean (i) conduct
amounting to fraud, dishonesty, negligence, or engaging in competition or
solicitations in competition with the Company and breaches of any applicable
employment agreement between the Company and the optionee, or (ii) be defined as
set forth in the employment
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<PAGE> 36
agreement between the Company and the optionee. Options granted to employees
under the 1994 Plan shall not be affected by any change of duties or position so
long as the holder continues to be a regular employee of the Company or any of
its current or future Subsidiaries. Any option agreement or any rules and
regulations relating to the 1994 Plan may contain such provisions as the Board
of Directors or the Committee, as the case may be, shall approve with reference
to the determination of the date employment terminates and the effect of leaves
of absence. Nothing in the 1994 Plan or in any option granted pursuant to the
1994 Plan shall confer upon any employee any right to continue in the employ of
the Company or any of its Subsidiaries or parent or affiliated companies or
interfere in any way with the right of the Company or any such Subsidiary or
parent or affiliated companies to terminate such employment at any time.
11. DEATH OR DISABILITY OF EMPLOYEE
If an employee to whom an option has been granted under the 1994 Plan
shall die while employed by the Company or a Subsidiary or within three (3)
months after the termination of such employment (other than termination for
cause or voluntary termination without the consent of the Company), such option
may be exercised, to the extent exercisable by the employee on the date of
death, by a legatee or legatees of the employee under the employee's last will,
or by the employee's personal representativ or distributees, at any time within
one year after the date of the employee's death, but not later than the date on
which the option terminates. In the event that the employment of an employee to
whom an option has been granted under the 1994 Plan shall be terminated as the
result of a disability, such option may be exercised, to the extent exercisable
by the employee on the date of such termination, at any time within one year
after the date of such termination, but not later than the date on which the
option terminates.
12. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, ETC.
The number and class of shares issuable under the 1994 Plan and any
outstanding options shall be adjusted to prevent dilution or enlargement of
rights, including adjustments in the event of changes in the outstanding Common
Stock by reason of stock dividends, split-ups, recapitalizations, mergers,
consolidations, combinations or exchanges of shares, separations,
reorganizations, liquidations and the like. In the event of any offer to holders
of Common Stock generally relating to the acquisition of their shares, the Board
of Directors or the Committee, as the case may be, may make such adjustment as
it deems equitable in respect of outstanding options and rights, including in
its discretion revision of outstanding options and rights so that they may be
exercisable for the consideration payable in the acquisition transaction. Any
such determination by the Board of Directors or the Committee, as the case may
be, shall be conclusive. Any fractional shares resulting from such adjustments
shall be eliminated.
-7-
<PAGE> 37
13. EFFECTIVE DATE
The 1994 Plan shall become effective on April 7, 1994; provided,
however, that any amendment thereto shall become effective in accordance with
applicable law.
14. TERMINATION AND AMENDMENT
The Board of Directors of the Company may suspend, terminate, modify
or amend the 1994 Plan in accordance with applicable law. No suspension,
termination, modification or amendment of the 1994 Plan may, without the consent
of the employee to whom an option shall theretofore have been granted, effect
the rights of such employee under such option.
15. MISCELLANEOUS
As said term is used in the 1994 Plan, the "Fair Market Value" of a
share of Common Stock on any day means: (a) if the principal market for the
Common Stock is a national securities exchange or the National Association of
Securities Dealers Automated Quotations System ("NASDAQ), the closing sales
price of the Common Stock on such day as reported by such exchange or market
system, or on a consolidated tape reflecting transactions on such exchange or
market system, or (b) if the principal market for the Common Stock is not a
national securities exchange and the Common Stock is not quoted on NASDAQ, the
mean between the highest bid and lowest asked prices for the Common Stock on
such day as reported by the National Quotation Bureau, Inc.; provided that if
clauses (a) and (b) of this paragraph are both inapplicable, or if no trades
have been made or no quotes are available for such day, the Fair Market Value of
the Common Stock shall be determined by the Board of Directors or the Committee,
as the case may be, shall be conclusive as to the Fair Market Value of the
Common Stock.
The Board of Directors or the Committee, as the case may be, may
require, as a condition to the exercise of any options granted under the 1994
Plan, that to the extent required at the time of exercise, (i) the shares of
Common Stock reserved for purposes of the 1994 Plan shall be duly listed, upon
official notice of issuance, upon stock exchange(s) on which the Common Stock is
listed, (ii) a Registration Statement under the Securities Act of 1933, as
amended, with respect to such shares shall be effective, and/or (iii) the person
exercising such option deliver to the Company such documents, agreements and
investment and other representations as the Board of Directors or the Committee,
as the case may be, shall determine to be in the best interests of the Company.
-8-
<PAGE> 38
During the term of the 1994 Plan, the Board of Directors or the
Committee, as the case may be, in its discretion, may offer one or more option
holders the opportunity to surrender any or all unexpired options for
cancellation or replacement. If any options are so surrendered, the Board of
Directors or the Committee, as the case may be, may then grant new Non-Qualified
or Incentive Options to such holders for the same or different numbers of shares
at higher or lower exercise prices than the surrendered options. Such new
options may have a different term and shall be subject to the provisions of the
1994 Plan the same as any other option.
Anything herein to the contrary notwithstanding, the Board of
Directors or the Committee, as the case may be, may, in their sole discretion,
impose more restrictive conditions on the exercise of an option granted pursuant
to the 1994 Plan; however, any and all such conditions shall be specified in the
option agreement limiting and defining such option.
16. COMPLIANCE WITH SEC REGULATIONS.
It is the Company's intent that the 1994 Plan comply in all respects
with Rule 16b-3 of the Act and any regulations promulgated thereunder. If any
provision of the 1994 Plan is later found not to be in compliance with said
Rule, the provisions shall be deemed null and void. All grants and exercises of
Incentive Options under the 1994 Plan shall be executed in accordance with the
requirements of Section 16 of the Act, as amended, and any regulations
promulgated thereunder.
-9-
<PAGE> 39
APPENDIX B
BRIGHTPOINT, INC.
EMPLOYEE STOCK PURCHASE PLAN
The following constitutes the provisions of the Brightpoint, Inc.
Employee Stock Purchase Plan.
1. PURPOSE
The purpose of this Plan is to provide Eligible Employees with an
incentive to advance the best interests of Brightpoint, Inc. by providing a
method whereby they may voluntarily purchase Common Stock at a favorable price
and upon favorable terms. This Plan is intended to meet, and should be
interpreted where possible to meet, the requirements of Section 423 of the Code.
2. DEFINITIONS
Capitalized terms used herein which are not otherwise defined shall
have the following meanings.
"ACCOUNT" shall mean the bookkeeping account maintained by the Company,
or by a recordkeeper on behalf of the Company, for a Participant pursuant to
Section 7(a).
"BOARD" shall mean the Board of Directors of the Company.
"CODE" shall mean the Internal Revenue Code of 1986, as amended.
"COMMITTEE" shall mean the committee appointed by the Board to
administer this Plan pursuant to Section 12.
"COMMON STOCK" shall mean the Common Stock, $0.01 par value per share,
of the Company.
"COMPANY" shall mean Brightpoint, Inc., a Delaware corporation.
"COMPENSATION" shall mean the following: regular wages and salary,
commissions and bonuses. Compensation also includes amounts contributed as
salary reduction contributions to any plan or program qualifying under Section
401(k) or 125 of the Code. Any other form of remuneration is excluded from
Compensation, including prizes, awards, housing allowances, income resulting
from the exercise of stock options or other acquisition of shares of Company
stock, auto allowances, and other forms of imputed income.
"CONTRIBUTIONS" shall mean the amounts credited to the Account of a
Participant pursuant to Section 7(a).
"ELIGIBLE EMPLOYEE" shall mean any employee of the Company or of any
Participating Subsidiary, except that any employee who has not as of the Grant
Date completed at least 6 months of continuous full-time employment or whose
customary employment is for
<PAGE> 40
less than 20 hours per week shall not be an Eligible Employee. At the sole
discretion of the Committee, periods of employment with a Subsidiary of the
Company that was not a Participating Subsidiary at the time of such employment,
with predecessors thereof, or with any other employer, may also be taken into
account. No employee shall be eligible if he or she is an owner of 5% or more of
the stock of the Company or an affiliated company as determined under Section
423(b)(3) of the Code.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934 as
amended from time to time, and the rules and regulations thereunder and
interpretation thereof.
"EXERCISE DATE" shall mean the first business day following the end of
the Offering Period.
"FAIR MARKET VALUE" shall mean the closing price of a Share for such
date (or, in the event that the Common Stock is not traded on such date, on the
immediately preceding trading date), on The Nasdaq Stock Market or, if such
price is not listed on The Nasdaq Stock Market, the mean of the bid and asked
prices per Share in the over-the-counter market, as furnished by the National
Association of Securities Dealers Automated Quotation system, or, if such prices
are not available, as determined by the Committee (or its delegate) in its
discretion.
"GRANT DATE" shall mean the first business day of each Offering Period
commencing on or after the Effective Date.
"OFFERING PERIOD" shall mean the period of each calendar month.
"OPTION" shall mean the nonqualified stock option to acquire Shares
granted to a Participant pursuant to Section 8.
"OPTION PRICE" shall mean the exercise price per share of an Option as
determined in accordance with Section 8(b).
"PARTICIPANT" shall mean an Eligible Employee who has elected to
participate in this Plan and who has filed a valid and effective Subscription
Agreement pursuant to Section 6.
"PARTICIPATING SUBSIDIARY" shall mean a Subsidiary which has been
designated in writing by the Committee as a "Participating Subsidiary" and which
by resolution of its board of directors or other governing body elects to
participate in the Plan and to authorize the Board and the Committee to act on
its behalf in all matters relating to the Plan.
"PLAN" shall mean this Brightpoint, Inc. Employee Stock Purchase Plan,
as amended from time to time.
"SHARE" shall mean a share of Common Stock.
"SUBSCRIPTION AGREEMENT" shall mean the agreement filed by an Eligible
Employee with the Company pursuant to Section 6 to participate in this Plan.
<PAGE> 41
"SUBSIDIARY" shall mean any corporation or other entity in an unbroken
chain of corporations or other entities (beginning with the Company) in which
each corporation or other entity (other than the last corporation or other
entity) owns, directly or in combination with the Company or one or more other
Subsidiaries, stock or other equity interests possessing [50%] or more of the
total combined voting power of all classes of stock or other equity interests in
one or more of the other corporations or other entities in the chain.
"TERMINATION OF EMPLOYMENT" shall mean the cessation or termination of
a Participant's employment with the Company or any Participating Subsidiary for
any cause or reason whatsoever, including but not limited to disability, death,
or resignation, whether voluntary or involuntary, with or without cause or
otherwise; but a change of employment from the Company or any Participating
Subsidiary to the Company or any other Participating Subsidiary shall not be
considered a Termination of Employment.
3. ELIGIBILITY
Any person employed as an Eligible Employee on a Grant Date shall be
eligible to participate in this Plan during the Offering Period commencing on
such Grant Date, subject to the satisfaction by such person of the requirements
of Section 6.
4. STOCK SUBJECT TO THIS PLAN; SHARE LIMITATIONS
a) The total number of Shares to be made available for purchase under
this Plan is 2,000,000 authorized and unissued or treasury shares of
Common Stock, subject to adjustments pursuant to Section 17. In the
event that all of the Shares made available under this Plan are
subscribed prior to the expiration of this Plan, this Plan may be
terminated in accordance with Section 18.
b) During any one calendar year, a Participant may not purchase, under
the Plan or under any other plan qualified under Section 423 of the
Code, Shares having a Fair Market Value on the appropriate Grant
Date in excess of $25,000.
c) A Participant's Account may not be used to purchase Shares on any
Exercise Date to the extent that, after such purchase, the
Participant would own (or be considered as owning within the meaning
of Code section 424(d) stock possessing 5% or more of the total
combined voting power of the Company. For this purpose, stock which
the Participant may purchase under any outstanding option shall be
treated as owned by such Participant. As of the first Exercise Date
on which this paragraph limits a Participant's ability to purchase
Shares, the Participant's payroll deductions shall terminate, and he
or she shall receive a refund on the cash balance in his Account.
5. OFFERING PERIODS
During the term of this Plan, the Company will offer Options to
purchase Shares to all Participants during each Offering Period. Except as
indicated by the third sentence
<PAGE> 42
of Section 6, each Option shall become effective on the Grant Date. The term of
each Option is one month and shall end on the Exercise Date. Offering Periods
shall continue until this Plan is terminated in accordance with Section 18, or,
if earlier, until no Shares remain available for Options pursuant to Section 4.
6. PARTICIPATION
An Eligible Employee may become a participant in this Plan by
completing a Subscription Agreement on a form approved by the Committee (or its
delegate) in the manner prescribed by the Committee or its delegate. A
Subscription Agreement must be filed with the Company prior to the applicable
Grant Date for the first Offering Period for which such Subscription Agreement
is intended to be effective, and must set forth the percentage of such Eligible
Employee's Compensation to be credited to the Participant's Account as
Contributions. Notwithstanding the preceding sentence, at the discretion of the
Committee, a Subscription Agreement filed for an Offering Period but after the
commencement thereof shall be given effect for Compensation for the portion of
the Offering Period following the date of receipt of such Subscription Agreement
by the Committee, as well as for Compensation for subsequent Offering Periods to
the extent provided below. An Eligible Employee may elect to contribute, in
whole percentages, not less than 1% and not more than 10% of such Eligible
Employee's Compensation during an Offering Period; provided, however, that a
Participant may not make Contributions in excess of [$2,000] during any Offering
Period. A Subscription Agreement shall evidence the authorization and consent by
an Eligible Employee to the Company's withholding from his or her Compensation
of the amount of his or her Contributions. A Subscription Agreement shall remain
in force for subsequent Offering Periods, unless and until (i) an Eligible
Employee executes and timely files a new Subscription Agreement modifying his or
her Contribution percentage or (ii) there is a termination, pursuant to the
provisions of this Plan, of such Eligible Employee's participation in the Plan.
7. METHOD OF PAYMENT OF CONTRIBUTIONS
a) The Company shall maintain on its books, or cause to be maintained
by a recordkeeper reporting to the Committee, an Account in the name
of each Participant. The percentage of Compensation elected to be
applied as Contributions by a Participant shall be deducted from
such Participant's Compensation on each payday during the period for
payroll deductions set forth below and such payroll deductions shall
be credited to that Participant's Account as of each such payday. A
Participant may not make any additional payments into his or her
Account. A Participant's Account shall be reduced by any amounts
used to pay the Option Price of Shares acquired, or by any amounts
distributed, pursuant to the terms hereof.
b) Payroll deductions shall commence as of the first day of the payroll
period which coincides with or immediately follows the applicable
Grant Date (or on such other date as may be determined by the
Committee in circumstances described in the third sentence of
Section 6), and shall end on the last day of the payroll period
which coincides with or immediately precedes the applicable Exercise
Date, unless sooner terminated by the Participant or otherwise as
provided in paragraph (c) of this Section and in Section 11.
<PAGE> 43
c) A Participant may terminate his or her participation in this Plan,
as provided in Section 11, by completing and filing with the
Company, in such manner as the Committee (or its delegate) may
prescribe, a new Subscription Agreement or such other form or notice
that the Committee may prescribe or deem acceptable for this
purpose. Such change shall be effective as soon as administratively
practicable after its receipt by the Company.
8. GRANT OF OPTION
a) On each Grant Date, or on such other date as is determined pursuant
to the parenthetical clause in Section 7(b) where relevant, each
Eligible Employee who elects to participate during that Offering
Period shall be granted an Option to purchase a number of Shares.
The Option shall be exercised on the Exercise Date as provided in
Section 9. The number of Shares subject to the Option shall be
determined by dividing the Participant's Account balance as of the
applicable Exercise Date by the Option Price (as determined pursuant
to Section 8(b)) and rounding down to the nearest whole number.
b) The Option Price per Share of the Shares subject to an Option shall
be the lesser of: (i) 85% of the Fair Market Value of a Share on the
applicable Grant Date, or (ii) 85% of the Fair Market Value of a
Share on the applicable Exercise Date.
9. EXERCISE OF OPTION
A Participant's Option for the purchase of Shares shall be exercised
automatically on the Exercise Date for that Offering Period, without any further
action on the Participant's part, and the maximum number of Shares subject to
such Option shall be purchased at the Option Price with the balance of such
Participant's Account. If any amount (which is not sufficient to purchase a
whole Share) remains in a Participant's Account after the exercise of his or her
Option on the Exercise Date, such amount shall be retained in the Participant's
Account during the next Offering Period and used to pay the Option Price of
Shares on the next Exercise Date, if he or she is a Participant during such
Offering Period, or if he or she is not a Participant during such Offering
Period, such amount shall be refunded to the Participant as soon as
administratively practicable. The Shares purchased upon exercise of an Option
shall be deemed to be transferred to the Participant on the applicable Exercise
Date.
10. DELIVERY
As soon as administratively practicable after each Exercise Date, but
subject to compliance with the requirements of this Plan, including, without
limitation, the provisions of Section 21 (relating to taxes), the Company shall
either (i) deliver to each Participant a certificate representing the Shares
purchased upon exercise of his or her Option, or (ii) in the event the Company
implements an alternative arrangement providing for delivery to a recordkeeping
service that maintains records regarding the ownership of Shares by
Participants, deliver such certificate or other evidence of ownership of such
Shares to such recordkeeping service. As a
<PAGE> 44
condition to participation in the Plan, each Participant shall agree to notify
the Company if he or she sells or otherwise disposes of any of his or her Shares
within two years of the Grant Date with respect to those Shares.
11. TERMINATION OF PARTICIPATION; TERMINATION OF EMPLOYMENT; REDUCTION
IN SERVICE
a) A Participant may terminate his or her participation in the Plan
during an Offering Period by giving written notice to the Company in
such manner as the Committee (or its delegate) may determine. As
soon as practicable after such notice is provided, the Participant's
Contributions shall cease and no further Contributions shall be made
for the Offering Period. Notwithstanding such termination, on the
Exercise Date for such Offering Period the Participant's remaining
Account balance shall be used to pay the Option Price of Shares
pursuant to Section 9.
b) Upon a Participant's Termination of Employment with the Company or a
Participating Subsidiary for any reason (including, but not limited
to, death or retirement) at any time prior to an Exercise Date, the
balance of the Participant's Account shall be paid in cash to him or
her, or, in the event of such Participant's death, to the person or
persons entitled thereto under Section 13, and such Participant's
Option for the Offering Period shall be automatically terminated.
c) In the event that during an Offering Period a Participant is no
longer an Eligible Employee, such Participant shall be determined to
have terminated participation in the Plan and the full amount of his
or her Account shall be paid to him or her in cash.
d) A Participant's termination of participation in the Plan during an
Offering Period for any reason precludes the Participant from again
participating in this Plan during that Offering Period. However,
such termination shall not have any effect upon his or her ability
to participate in any succeeding Offering Period, provided that the
applicable eligibility and participation requirements are met. A
Participant's termination from Plan participation shall be deemed to
be a revocation of that Participant's Subscription Agreement and
such participant must file a new Subscription Agreement to resume
Plan participation in any succeeding Offering Period.
12. ADMINISTRATION
The Board shall appoint the Committee that shall supervise and
administer this Plan and shall have full power and discretion to adopt, amend
and rescind any rules deemed desirable and appropriate for the administration of
this Plan and not inconsistent with the terms of this Plan, and to make all
other determinations necessary or advisable for the administration of this Plan.
No member of the Committee shall be entitled to act on or decide any matter
relating solely to himself or herself or any of his or her rights or benefits
under this Plan. The Committee shall have full power and discretionary authority
to construe and interpret the terms and conditions of this Plan, which
construction or interpretation shall be final and binding on all parties
including
<PAGE> 45
the Company, each Participant and his or her beneficiaries, spouse, estate and
other heirs, and each Participating Subsidiary. The composition of the Committee
shall be in accordance with the requirements to obtain or retain any available
exemption from Section 16(b) of the Exchange Act.
13. DESIGNATION OF BENEFICIARY
a) A Participant may file, in a manner prescribed by the Committee (or
its delegate), a written designation of a beneficiary who is to
receive any Shares or cash from such Participant's Account under
this Plan in the event of such Participant's death. If a
Participant's death occurs subsequent to the end of an Offering
Period but prior to the delivery to him or her of any Shares
deliverable under the terms of this Plan, such Shares and any
remaining balance of such Participant's Account shall be paid to
such beneficiary (or such other recipient as is determined pursuant
to Section 13(b)) as soon as administratively practicable after the
Company receives notice of such Participant's death, and any
outstanding unexercised Option granted to such Participant shall
terminate. If a Participant's death occurs at any other time, the
balance of such Participant's Account shall be paid to such
beneficiary (or such other recipient as is determined pursuant to
Section 13(b)) in cash as soon as administratively practicable after
the Company receives notice of such Participant's death and such
Participant's Option shall terminate. If a Participant is married at
the time of filing of a designation of beneficiary and the
designated beneficiary is not his or her spouse, the consent of the
person then married to the Participant shall be required for such
designation to be effective.
b) Beneficiary designations may be changed by a Participant (and his or
her spouse, if required) at any time on forms provided and in the
manner prescribed by the Committee (or its delegate). If a
Participant dies with no validly designated beneficiary under this
Plan who is living at the time of such Participant's death, the
Company shall deliver all Shares and/or cash payable pursuant to the
terms hereof to the executor or administrator of the estate of the
Participant, or if no such executor or administrator has been
appointed, the Company may deliver such Shares and/or cash to the
spouse or to any one or more dependents or relatives of the
Participant, or to such other person as is determined by the Company
to be entitled to such property under applicable law.
14. TRANSFERABILITY
Neither Contributions credited to a Participant's Account nor any
Options or rights with respect to the exercise of Options or rights to receive
Shares under this Plan may be assigned, transferred, pledged or otherwise
disposed of by the Participant in any way (other than by will, the laws of
descent and distribution, or as provided in Section 13). Any such attempt at
assignment, transfer, pledge or other disposition shall be void and of no force
or effect.
<PAGE> 46
15. USE OF FUNDS; INTEREST; DIVIDENDS
All Contributions received or held by the Company under this Plan will
be included in the general assets of the Company and may be used for any
corporate purpose, and need not be set aside in a segregated account. It is
intended that the Plan constitute an "unfunded" plan for incentive compensation,
and Participants shall have no interest in any amounts set aside by the Company
to purchase Shares under the Plan or otherwise. No interest or dividends will be
paid to any Participant or credited to his or her Account under this Plan.
16. REPORTS
Statements shall be provided to Participants as soon as
administratively practicable following each Exercise Date. Each Participant's
statement shall set forth, as of such Exercise Date, that Participant's Account
balance immediately prior to the exercise of his or her Option, the Fair Market
Value of a Share, the Option Price, the number of Shares purchased and his or
her remaining Account balance, if any.
17. ADJUSTMENTS OF AND CHANGES IN THE STOCK
In the event that the Shares shall be changed into or exchanged for a
different number or kind of shares of stock or other securities of the Company
or of another corporation (whether by reason or merger, consolidation,
recapitalization, stock split, combination of shares, or otherwise), or if the
number of Shares shall be increased through a stock split or the payment of a
stock dividend, then there shall be substituted for or added to each Share
theretofore reserved for sale under this Plan, the number and kind of shares of
stock or other securities into which each outstanding Share shall be so changed,
or for which each such Share shall be exchanged, or to which each such Share is
entitled, as the case may be, for the number or kind of securities which may be
sold under this Plan and the purchase price per Share shall be appropriately
adjusted consistent with such change in such manner as the Committee (or its
delegate) may deem equitable to prevent substantial dilution of enlargement of
rights granted to, or available for, Eligible Employees under this Plan.
In making any adjustments hereunder, or in determining that no such
adjustments are necessary, the Committee may rely upon the advice of either or
both of legal counsel and independent accountants. The determination of the
Committee as to adjustments, if any, shall be binding and conclusive.
18. TERM OF PLAN; AMENDMENT OR TERMINATION
a) This Plan shall become effective on the Effective Date specified in
Section 25. This Plan shall terminate at the close of business on
the Exercise Date for the Offering Period ending June 30, 2010,
unless sooner terminated pursuant to this Section 18.
b) The Board may at any time in its discretion modify or amend, in
whole or in part, any provision of or otherwise alter, suspend or
terminate this Plan as it may deem advisable. Notwithstanding the
foregoing, no such Board action may, without the consent of an
Eligible Employee, adversely affect any Option theretofore granted
to an Eligible Employee.
<PAGE> 47
19. NOTICES
All notices or other communications by a Participant to the Company or
a Participating Subsidiary that are contemplated by this Plan shall be deemed to
have been duly given when received in the form and manner specified by the
Committee (or its delegate) at the location or locations, or by the person or
persons, designated by the Committee (or its delegate) for that purpose. If such
a designation is not made, any such notice shall be addressed to the Company as
follows: 6402 Corporate Drive, Indianapolis, Indiana 46278, Attention:
Secretary.
20. CONDITIONS UPON ISSUANCE OF SHARES
Shares shall not be issued with respect to an Option unless the
exercise of such Option and the issuance and delivery of such Shares complies
with all applicable provisions of law, domestic or foreign, including, without
limitation, the Securities Act of 1933, as amended, the Exchange Act, any
applicable state securities laws, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange or other established
securities market upon which the Shares may then be listed.
As a condition precedent to the exercise of any Option, if, in the
opinion of counsel for the Company such representation is necessary or
appropriate under applicable law, the Company may require any person exercising
such Option to represent and warrant that the Shares subject thereto are being
acquired only for investment and without any present intention to sell or
distribute such Shares.
21. WITHHOLDING OF TAXES
Upon the exercise of an Option, the Participant to whom the Option was
granted shall be required to pay to the Company or any Participating Subsidiary
the amount of any federal, state, local or foreign taxes which the Company or
any Participating Subsidiary is required to deduct, withhold or pay over with
respect to the exercise of such Option, and the Company or such Participating
Subsidiary shall have the right to deduct from any wages or other compensation
paid to the Participant by the Company (including through the withholding of
Shares purchased upon the exercise of an Option, if then authorized by the
Committee and applicable law) or such Participating Subsidiary the amount of any
tax required to be deducted, withheld or paid over with respect to an Option
which is not otherwise paid. The Company shall not be required to make any
delivery of any Shares under this Plan until the amounts of all taxes described
in the preceding sentence relating to such Shares have been received by the
Company or such Participating Subsidiary.
22. ADDITIONAL RESTRICTIONS OF RULE 16b-3
The terms and conditions of Options granted hereunder to, and the
purchase of Shares by persons subject to Section 16 of the Exchange Act shall
comply with the applicable provisions of Rule 16b-3 promulgated thereunder
("Rule 16b-3"). This Plan shall be deemed to contain, and Options shall contain,
and the Shares issued upon exercise thereof shall be subject to, such
<PAGE> 48
additional conditions and restrictions as the Committee (or its delegate) may
determine, in its discretion, are required by Rule 16b-3 to qualify for the
maximum exemption available from Section 16 of the Exchange Act.
23. GOVERNMENT REGULATIONS
This Plan, the grant of Options and the transfer by the Company of
Shares pursuant to the exercise of Options hereunder, and all related
transactions between the Company and the Participant shall be subject to all
applicable federal, state, local and foreign laws, rules and regulations and to
such approvals by regulatory or governmental agencies as may be required.
24. EMPLOYEE'S RIGHTS
Nothing in this Plan shall confer on any Eligible Employee any right to
continue in the service of the Company or any Subsidiary, or prevent, interfere
with or limit in any way the right of the Company or any Subsidiary to terminate
any Eligible Employee's employment or service on the Board at any time. No
employee shall have any rights as a stockholder until a certificate for Shares
has been issued in the Participant's name (or such Shares have otherwise been
delivered pursuant to Section 10) following exercise of his or her Option.
25. EFFECTIVE DATE
This Plan is effective as of July 1, 1999, subject to receiving
stockholder approval prior thereto.
<PAGE> 49
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BRIGHTPOINT, INC.
6402 CORPORATE DRIVE
INDIANAPOLIS, INDIANA 46278
PROXY FOR ANNUAL MEETING OF STOCKHOLDERS TO BE HELD MAY 18, 1999
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints PHILLIP A. BOUNSALL and STEVEN E. FIVEL,
and each of them, Proxies, with full power of substitution in each of them, in
the name, place and stead of the undersigned, to vote at the Annual Meeting of
Stockholders of Brightpoint, Inc. (the "Company") on Tuesday, May 18, 1999, at
the Westin Hotel Indianapolis, 50 South Capitol Avenue, Indianapolis, Indiana
46204 or at any adjournment or adjournments thereof, according to the number of
votes that the undersigned would be entitled to vote if personally present, upon
the following matters:
(CONTINUED AND TO BE SIGNED ON REVERSE SIDE)
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<TABLE>
<CAPTION>
- Please Detach and Mail in the Envelope Provided -
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<S> <C> <C> <C>
A [X] PLEASE MARK YOUR
VOTES AS IN THIS
EXAMPLE.
FOR all
nominees WITHHOLD
listed at AUTHORITY
right (except to vote for
as marked to nominees
the contrary listed
below) at right FOR AGAINST ABSTAIN
1. ELECTION [ ] [ ] NOMINEES: Robert J. Laikin 2. Approval of Amendment to the [ ] [ ] [ ]
CLASS II Robert F. Wagner Company's 1994 Stock Option
DIRECTORS: Rollin M. Dick Plan
(INSTRUCTION: To withhold authority to vote for any 3. Approval of Adoption of the [ ] [ ] [ ]
individual nominee, write that nominee's name in the 1999 Brightpoint, Inc. Employee
space below.) Stock Purchase Plan
4. In their discretion, the Proxies are authorized to vote
upon such other business as may properly come before the
meeting.
- -----------------------------------------------------
THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE
INSTRUCTIONS GIVEN ABOVE. IF NO INSTRUCTIONS ARE
GIVEN, THIS PROXY WILL BE VOTED FOR THOSE NOMINEES
AND THE PROPOSALS LISTED ABOVE.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD USING
THE ENCLOSED ENVELOPE.
Signature___________________________________ Signature if held jointly________________________________ DATED___________, 1999
NOTE:Please sign exactly as name appears hereon. When shares are held by joint tenants, both should sign. When signing as attorney,
executor, administrator, trustee or guardian, please give full title as such. If a corporation, please sign in full corporate name
by President or other authorized officer. If a partnership, please sign in partnership name by authorized person.
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