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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 12, 2000.
REGISTRATION NO. 333-_________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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BRIGHTPOINT, INC.
(Exact name of registrant as specified in its charter)
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DELAWARE 6402 CORPORATE DRIVE 35-1778566
(State or other INDIANAPOLIS, IN 46278 (IRS employer
jurisdiction of (317) 297-6100 identification
incorporation or (Address, including zip code, and number)
organization) telephone number, including area code,
of registrant's principal executive offices)
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J. MARK HOWELL, PRESIDENT
BRIGHTPOINT, INC.
6402 CORPORATE DRIVE
INDIANAPOLIS, IN 46278
(317) 297-6100
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
COPY TO:
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Robert J. Mittman, Esq.
Blank Rome Tenzer Greenblatt LLP
405 Lexington Avenue
New York, New York 10174
Telephone: (212) 885-5555
Facsimile: (212) 885-5001
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. |_| ____
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. |_| _____
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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<S> <C> <C> <C> <C>
PROPOSED
MAXIMUM PROPOSED
TITLE OF EACH AMOUNT OFFERING MAXIMUM AMOUNT OF
CLASS OF SECURITIES TO BE PRICE PER AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED(1) SECURITY(2) OFFERING PRICE(2) FEE
- --------------------------------- ------------------------- ----------------- ------------------- ------------------
Common Stock, par value $.01 382,659 (3) $ 11.32 $4,331,700 $1,143.57
per share
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</TABLE>
(1) All of the shares of Common Stock being registered hereby are being offered
for the account of a selling stockholder who acquired such shares in
private transactions. No other shares of the registrant's common stock are
being registered pursuant to this offering.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) of the Securities Act of 1933, as amended, based
upon a price of $11.32 per share, the average of the high and low sale
prices as reported in the consolidated reporting system (NASDAQ) for the
registrant's common stock on May 9, 2000.
(3) Pursuant to Rule 416 of the Securities Act of 1933 there are also being
registered hereunder such additional shares as may be issued to the selling
stockholder because of any future stock dividends, stock distributions,
stock splits or similar capital readjustments.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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PRELIMINARY PROSPECTUS DATED MAY 12, 2000
SUBJECT TO COMPLETION
BRIGHTPOINT, INC.
382,659 SHARES OF COMMON STOCK
This prospectus relates to the resale of up to 382,659 shares of our common
stock by a certain stockholder.
The selling stockholder may sell these shares from time to time through
ordinary brokerage transactions in the over-the-counter markets, in negotiated
transactions or otherwise, at market prices prevailing at the time of sale, at
negotiated prices and in certain other ways, as described under "Plan of
Distribution" on page 14. We will not receive any of the proceeds from the sale
of these shares.
Our common stock is traded on the NASDAQ National Market under the symbol
CELL. On May 9, 2000, the closing sale price of our common stock as reported by
Nasdaq was $11.00.
INVESTING IN OUR COMMON STOCK IS SPECULATIVE AND INVOLVES A HIGH DEGREE OF
RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 3.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is , 2000.
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SPECIAL INFORMATION REGARDING FORWARD LOOKING INFORMATION
Certain statements in this prospectus or in the documents incorporated by
reference herein constitute "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors
which may cause our actual results, performance or achievements to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include, among others,
those discussed in the Risk Factor Section appearing elsewhere in this
prospectus. The words "believe", "expect", "anticipate", "intend" and "plan" and
similar expressions identify forward-looking statements. We caution you not to
place undue reliance on these forward-looking statements, which speak only as of
the date the statement was made.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
We have previously filed the following documents with the SEC. These
documents are incorporated by reference in and shall be deemed a part of this
prospectus:
(a) Annual Report on Form 10-K for the fiscal year ended December 31,
1999 including certain information in our Definitive Proxy Statement dated
April 7, 2000 and certain information in our 1999 Annual Report to
Stockholders incorporated by reference in the Form 10-K and
(b) The description of our common stock, par value $.01 per share,
contained in our Registration Statement on Form 8-A declared effective on
April 7, 1994 and description of the attendant Preferred Share Purchase
Rights contained in our Registration Statement on Form 8-A dated March 28,
1997, together with any amendments or reports filed with the SEC for the
purpose of updating such descriptions.
All documents that we file pursuant to Sections 13(a), 13(c), 14 or 15(d)
of the Securities Exchange Act of 1934, as amended, after the date of this
prospectus and before the termination of the offering of the securities under
this prospectus shall be deemed to be incorporated by reference in and a part of
this prospectus as of the date of filing with the SEC. Any statement
incorporated in this prospectus shall be deemed to be modified or superseded to
the extent that a statement contained in a subsequently filed document which is
deemed to be incorporated by reference in this prospectus modifies or supersedes
such statement. Any statement which has been subsequently modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this prospectus or the registration statement of which it is a part.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WITH RESPECT TO
BRIGHTPOINT, INC. THAT ARE NOT PRESENTED HEREIN OR DELIVERED HEREWITH. THESE
DOCUMENTS ARE AVAILABLE WITHOUT CHARGE TO ANY PERSON, INCLUDING ANY BENEFICIAL
OWNER, TO WHOM THIS PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL REQUEST TO MR.
PHILLIP A. BOUNSALL, BRIGHTPOINT, INC., 6402 CORPORATE DRIVE, INDIANAPOLIS,
INDIANA 46278, TELEPHONE: (317) 297-6100.
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PROSPECTUS SUMMARY
THE COMPANY
We are a leading provider of outsourced services in the global wireless
telecommunications and data industry. Our services include contract
manufacturing, customized packaging, prepaid and e-commerce solutions, inventory
management, distribution and other outsourced services. Our customers include
leading network operators, e-tailers, retailers and wireless equipment
manufacturers. We handle products manufactured by such technology companies as
Nokia, Ericsson, Motorola, Samsung, Panasonic, Kyocera, Alcatel, Siemens, Sony,
Audiovox, NEC, and Research In Motion. We also provide integrated services to
these manufacturers and some of the world's leading wireless network operators
along with their associated service providers, resellers, agents and retailers.
Our distribution services include purchasing, marketing, selling, warehousing,
picking, packing, shipping and delivery of wireless handsets and accessories.
Our integrated logistics services include support for prepaid programs,
inventory management, procurement, product fulfillment, programming, light
assembly, telemarketing, private labeling, kitting and customized packaging,
product warranty, repair and refurbishment and end-user support services. We are
one of the largest dedicated distributors of wireless handsets and accessories
in the world, with operations centers and/or sales offices in various countries
including Australia, Brazil, China (including Hong Kong), France, Germany,
Ireland, Mexico, the Netherlands, New Zealand, the Philippines, South Africa,
Sweden, the United Arab Emirates, the United States and Venezuela.
We were incorporated under the laws of the State of Indiana in August 1989
under the name Wholesale Cellular USA, Inc. and reincorporated under the laws of
the State of Delaware in March 1994. In September 1995, we changed our name to
Brightpoint, Inc.
Our principal executive offices are located at 6402 Corporate Drive,
Indianapolis, Indiana 46278, and our telephone number is (317) 297-6100.
RISK FACTORS
Prospective investors should consider carefully the following risk factors
before purchasing any shares of the Common Stock offered hereby.
IN THE PAST TWO YEARS WE HAVE INCURRED SIGNIFICANT LOSSES DURING CERTAIN
QUARTERLY PERIODS.
Although we achieved a profit of approximately $9.9 million during the
three months ended December 31, 1999, we incurred net losses for each of the
first two quarters of 1999 and a net loss of $93.1 million for the year ended
December 31, 1999. We also incurred a net loss of $7.1 million for the three
months ended December 31, 1998. The net loss for 1999 includes approximately
$84.9 million of restructuring and other unusual charges as well as the
cumulative effect of an accounting change of $14.1 million. The net loss for the
three months ended December 31, 1998 includes approximately $25.7 million of
trading and other unusual charges resulting from our decision to eliminate our
trading activities. Several business factors appear to have contributed to our
losses in these periods including an inadequate supply of products for sale
through our distribution services, our inability to replace, during 1999,
revenues which had been generated by the trading business that we exited in the
fourth quarter of 1998, the impacts of the devaluation of the Brazilian Real and
price competition from trading companies in our Asia-Pacific and Latin America
divisions. We may incur additional future losses.
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WE HAVE SIGNIFICANT OUTSTANDING INDEBTEDNESS, WHICH IS SECURED BY A LARGE
PORTION OF OUR ASSETS AND WHICH COULD PREVENT US FROM BORROWING ADDITIONAL
FUNDS, IF NEEDED.
As of December 31, 1999, approximately $41.2 million was outstanding under
our $175 million senior secured revolving line of credit facility with Bank One,
Indiana, NA, as agent for a group of banks and approximately $4.8 million of
other indebtedness was outstanding. All of our assets located in the United
States and between 65% and 100% of the capital stock of certain of our
subsidiaries are pledged as collateral under the credit facility. In addition,
during 1998 we issued an aggregate of $380 million face value of 20-year
zero-coupon, subordinated, convertible notes which had an accreted value of $185
million at December 31, 1999. If we violate our loan covenants, default on our
obligations or become subject to a change of control, our indebtedness could
become immediately due and payable, and the banks could foreclose on our assets.
The terms of our senior credit facility substantially prohibit us from
incurring additional indebtedness, which could limit our ability to expand our
operations. Our senior credit facility also limits or prohibits us from
declaring or paying cash dividends, making capital distributions or other
payments to stockholders, merging or consolidating with another corporation or
selling all or substantially all of our assets.
THERE ARE SIGNIFICANT AMOUNTS OF OUR SECURITIES WHICH ARE ISSUABLE UPON EXERCISE
OF OUTSTANDING CONVERTIBLE SECURITIES AS WELL AS UNDER OTHER STOCK PLANS WHICH
COULD AFFECT THE MARKET PRICE OF OUR COMMON STOCK.
The $380 million face value of our 20-year zero-coupon, subordinated,
convertible notes are convertible at the option of the holder any time prior to
maturity. These notes are convertible at the rate of 19.109 shares of common
stock per $1,000 face value note, for an aggregate of 7,261,420 shares of common
stock. Additionally, we have reserved a significant number of shares of common
stock that may be issuable pursuant to our employee stock purchase plan, our
stock option plans and upon the exercise of currently outstanding warrants. In
addition, we may issue additional securities as discussed herein in the section
entitled "Description of Capital Stock." These securities when issued and
outstanding may reduce earnings per share in periods that they are considered
dilutive under Generally Accepted Accounting Principles and, to the extent that
they are exercised and shares of common stock are issued, dilute percentage
ownership to existing stockholders which could have an adverse effect on the
market price of our common stock.
WE HAVE INSTITUTED MEASURES TO PROTECT US AGAINST A TAKEOVER.
As more fully discussed in the section of this prospectus entitled
"Description of Capital Stock" certain provisions of our by-laws, stockholders
rights and option plans, certain employment agreements and the Delaware General
Corporation Law are designed to protect us in the event of a takeover attempt.
These provisions could prohibit or delay mergers or attempted takeovers or
changes in control of us and, accordingly, may discourage attempts to acquire
us.
OUR FUTURE OPERATING RESULTS WILL DEPEND ON OUR ABILITY TO CONTINUE TO INCREASE
OUR SALES SIGNIFICANTLY.
A large percentage of our total net revenues in recent periods has come
from sales of wireless handsets, a segment of our business that operates on a
high-volume, low-margin basis. Our ability to generate these sales is based upon
our having adequate supply of products. Approximately 76% of our total net
revenues from recurring operations during 1999 consisted of sales of wireless
handsets, which produce relatively lower profits for us. The gross margins that
we realize on sales of wireless handsets could be reduced due to increased
competition or a growing industry emphasis on cost containment.
In addition, our operating expenses have increased significantly. We expect
these expenses to continue to increase as we expand our activities and increase
our provision of integrated logistics services. Therefore, our future
profitability will depend on our ability to increase sales to cover our
additional expenses. We may not be able to cause
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our sales rates to grow substantially. Even if our sales rates do increase, the
gross margins that we receive from our sales may not be sufficient to make our
future operations profitable.
A SIGNIFICANT PERCENTAGE OF OUR REVENUES ARE GENERATED OUTSIDE OF NORTH AMERICA
IN COUNTRIES WITH INADEQUATE PRODUCT SUPPLIES, VOLATILE CURRENCIES OR OTHER
RISKS.
For the years ended December 31, 1998 and 1999, our revenues from recurring
operations in markets outside of North America represented approximately 62%,
and 55% of our total net revenues. Our actual revenues and results of operations
for fiscal 1999 were below our initial anticipated results. We believe that this
was due primarily to the devaluation of the Brazilian currency, our inability to
obtain adequate supplies of products for sale in the People's Republic of China
and increased price competition from trading companies in our Asia-Pacific and
Latin America divisions.
Foreign currency fluctuations
A significant portion of our revenues outside the United States are
denominated in foreign currencies. The recent devaluation of the Brazilian
currency adversely impacted our results for the year ended December 31, 1999 and
a decrease in the value of other foreign currencies relative to the U.S. Dollar
could result in a significant decrease in our revenues reported in U.S. Dollars.
We purchase and sell products and services in a large number of foreign
currencies, many of which have experienced fluctuations in currency exchange
rates. On occasion, we enter into forward exchange swaps, futures or options
contracts as a means of hedging our currency transaction and balance sheet
translation exposures. However, our management has had limited prior experience
in engaging in these types of transactions. Even if done well, hedging may not
effectively limit our exposure to a decline in operating results due to foreign
currency translation. We cannot predict the effect that future exchange rate
fluctuations will have on our operating results.
International operations
We maintain operations centers and sales offices in many other territories
and countries. The fact that our business operations are conducted in a wide
variety of countries exposes us to increased credit risks, customs duties,
import quotas and other trade restrictions, potentially greater inflationary
pressures, shipping delays, the risk of failure or material interruption of
wireless systems and services, possible wireless product supply interruption and
potentially significant increases in wireless product prices. Changes may occur
in social, political, regulatory and economic conditions or in laws and policies
governing foreign trade and investment in the territories and countries where we
currently have operations. U.S. laws and regulations relating to investment and
trade in foreign countries could also change to our detriment. Any of these
factors could have a material adverse effect on our business and operations.
During 1999 and pursuant to our restructuring plan, we terminated or eliminated
several of our foreign operations because they were not performing to acceptable
levels. These terminations resulted in significant losses to us. We may in the
future, decide to terminate certain existing foreign operations. This could
result in our incurring significant additional losses.
OUR BUSINESS DEPENDS ON THE CONTINUED TENDENCY OF WIRELESS EQUIPMENT
MANUFACTURERS AND NETWORK OPERATORS TO OUTSOURCE ASPECTS OF THEIR BUSINESS TO US
IN THE FUTURE.
Our business depends in large part on wireless equipment manufacturers and
network operators outsourcing some or all of their business functions. We
fulfill functions such as contract manufacturing, customized packaging, prepaid
and e-commerce solutions, inventory management, distribution and other
outsourced services for many of these manufacturers and network operators. In
the future, wireless equipment manufacturers and network operators may elect to
undertake these services internally. Additionally, industry consolidation,
competition, deregulation, technological changes or other developments could
reduce the degree to which members of the wireless telecommunications and data
industry rely on outsourced integrated logistics services such as the services
we provide. Any significant change in the market for our outsourcing services
could have a material adverse effect on
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our business. Our outsourced services are generally provided under multi-year
renewable contractual arrangements. The initial service periods under certain of
our contractual arrangements are expiring or will expire in the near future. The
failure to obtain renewal of these agreements could have a material adverse
effect on our business.
WE BUY A SIGNIFICANT AMOUNT OF OUR PRODUCTS FROM A LIMITED NUMBER OF SUPPLIERS,
WHO MAY NOT PROVIDE US WITH COMPETITIVE PRODUCTS AT REASONABLE PRICES WHEN WE
NEED THEM IN THE FUTURE.
We purchase all of the wireless handsets and accessories that we sell from
third-party wireless communications equipment manufacturers, dealers and network
operators. For the years ended December 31, 1998 and 1999, we purchased
approximately 75% of our product supplies from only two sources of wireless
handsets and accessories. For the year ended December 31, 1999, Nokia and
Ericsson accounted for approximately 68% and 7% of our product purchases,
respectively. We depend on these suppliers to provide us with adequate
inventories of currently popular brand name products on a timely basis and on
favorable pricing terms. Our agreements with our suppliers are generally
non-exclusive, require us to satisfy minimum purchase requirements, can be
terminated on short notice and provide for certain territorial restrictions, as
is common in our industry.
We generally purchase products pursuant to purchase orders placed from time
to time in the ordinary course of business. In the future, our suppliers may not
be able or may choose not to offer us competitive products on favorable terms
without delays. In 1999, we were unable to obtain sufficient product supplies
from manufacturers in many markets in which we operate. This product shortage
was most dramatic in certain of our Asian markets. Any future failure or delay
by our suppliers in supplying us with products on favorable terms would severely
diminish our ability to obtain and deliver products to our customers on a timely
and competitive basis. If we lose any of our principal suppliers, or if any
supplier imposes substantial price increases and alternative sources of supply
are not readily available, it would have a material adverse effect on our
results of operations.
THE WIRELESS TELECOMMUNICATIONS AND DATA INDUSTRY IS INTENSELY COMPETITIVE AND
WE MAY NOT BE ABLE TO CONTINUE TO COMPETE SUCCESSFULLY IN THIS INDUSTRY.
We compete for sales of wireless telecommunications and data equipment, and
expect that we will continue to compete, with numerous well-established wireless
network operators, distributors and manufacturers, including our own suppliers.
As a provider of integrated logistics services, we also compete with other
distributors and with logistics services companies. Many of our competitors
possess greater financial and other resources than we do and may market similar
products directly to our customers. The wireless telecommunications and data
industry has generally had low barriers to entry. Consequently, additional
competitors may choose to enter our industry in the future.
The markets for wireless handsets and accessories are characterized by
intense price competition and significant price erosion over the life of a
product. Many of our competitors have the financial resources to withstand
substantial price competition and to implement extensive advertising and
promotional programs, both generally and in response to efforts by additional
competitors to enter into new markets or introduce new products. Our ability to
continue to compete successfully will depend largely on our ability to maintain
our current industry relationships. We may not be successful in anticipating and
responding to competitive factors affecting our industry, including new or
changing outsourcing requirements, the entry of additional well-capitalized
competitors, new products which may be introduced, changes in consumer
preferences, demographic trends, international, national, regional and local
economic conditions and competitors' discount pricing and promotion strategies.
As the cellular markets mature and as we seek to enter into new markets and
offer new products in the future, the competition that we face may change and
grow more intense.
WE MAY NOT BE ABLE TO MANAGE AND SUSTAIN FUTURE GROWTH AT OUR HISTORICAL AND
CURRENT RATES.
In recent years we have experienced rapid domestic and international
growth. We will need to manage our expanding operations effectively, maintain or
accelerate our growth as planned and integrate any new businesses
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which we may acquire into our operations successfully in order to continue our
desired growth. If we are unable to do so, particularly in instances in which we
have made significant capital investments, it could have a material adverse
effect on our operations.
Our success in sustaining continued growth will also depend on our ability
to:
- secure adequate supplies of competitive products on a timely basis and
on commercially reasonable terms;
- turn our inventories and collect our accounts receivable in a timely
manner;
- develop additional, and maintain our existing, key relationships with
leading network operators and manufacturers and dealers of wireless
handsets and accessories;
- hire and retain additional qualified management, marketing and other
personnel to successfully manage our growth, including personnel to
monitor our operations, control costs and maintain effective
management, inventory and credit controls; and
- invest significant amounts to enhance our information systems in order
to maintain our competitiveness and to develop new logistics services.
In addition, our growth prospects could be adversely affected by a decline
in the wireless telecommunications and data industry generally or in one of its
regional divisions, either of which could result in reduction or deferral of
expenditures by prospective customers.
RAPID TECHNOLOGICAL CHANGES IN THE WIRELESS TELECOMMUNICATIONS AND DATA INDUSTRY
COULD HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS.
The technology relating to wireless telecommunications and data equipment
changes rapidly, and industry standards are constantly evolving resulting in
product obsolescence or short product life cycles. We are required to anticipate
future technological changes in our industry and to continually identify, obtain
and market new products in order to satisfy evolving industry and customer
requirements. Competitors or manufacturers of wireless equipment may market
products which have perceived or actual advantages over our products or which
otherwise render our products obsolete or less marketable. We have made and
continue to make significant capital investments in accordance with evolving
industry and customer requirements. These concentrations of capital increase our
risk of loss as a result of rapid technological changes in the wireless
telecommunications and data industry.
The use of emerging wireless communications technologies, including
Bluetooth, wireless local loop, satellite-based communications systems and other
new technologies, may reduce the demand for existing cellular and PCS products.
If other companies develop and commercialize new technologies or products in
related market segments that compete with existing cellular and PCS technology,
it could materially change the types of products that we are forced to offer or
result in significant price competition for us. Product obsolescence could
result in significantly increased inventories of our unsold products. However,
if we elect to stock our inventories in the future with any of these
technologies and products, we will run the risk that our existing customers and
consumers may not be willing, for financial or other reasons, to purchase new
equipment necessary to utilize these new technologies. In addition, the complex
hardware and software contained in new wireless handsets could contain defects
which become apparent subsequent to widespread commercial use, resulting in
product recalls and returns and leaving us with additional unsold inventory.
OUR BUSINESS STRATEGY INCLUDES ENTERING INTO STRATEGIC RELATIONSHIPS AND
FINANCINGS, WHICH MAY PROVIDE US WITH MINIMAL RETURNS OR LOSSES ON OUR
INVESTMENTS.
As part of our expansion strategy, we have entered into several strategic
relationships and joint ventures with wireless equipment manufacturers and
network operators. We intend to continue to enter into similar strategic
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relationships as opportunities arise. We may enter into distribution or
integrated logistics services agreements with these strategic partners and may
provide them with equity or debt financing.
Our ability to achieve future profitability through our strategic
relationships will depend in part upon the economic viability, success and
motivation of the entities we select as strategic partners and the amount of
time and resources that these partners devote to our alliances. We may receive
minimal or no business from future relationships and joint ventures, and any
business we receive may not be significant or at the level we anticipated. The
future profits we receive from these strategic relationships, if any, may not
offset possible losses on our investments or the full amount of financings that
we extend upon entering into these relationships. Any loan to or investment in a
future strategic partner will be subject to many of the same risks faced by the
strategic partner in seeking to operate and grow its businesses. We may not
achieve acceptable returns on our future investments with strategic partners
within an acceptable period or at all.
As a part of our restructuring plan in 1999 we terminated two joint
operations in China resulting in significant losses on our investments in those
operations. A failure in the establishment and operation of such relationships
could have a material adverse effect on our operations.
WE MAY HAVE DIFFICULTY COLLECTING ON OUR ACCOUNTS RECEIVABLE.
Our accounts receivable, less an allowance for doubtful accounts, was
approximately $281 million, and $237 million at December 31, 1998 and December
31, 1999. At December 31, 1999, our allowance for doubtful accounts was
approximately $6.2 million, which we believed was adequate for the size and
nature of our receivables at that date. Bad debt expense as a percent of
revenues was less than 1.0% for 1998 and 1999. However, we incurred significant
accounts receivable impairments in connection with the discontinuance of trading
activities in 1998 and our restructuring plan in 1999 because we ceased doing
business in certain markets, significantly reducing our ability to collect the
related receivables. Any difficulties in collecting amounts due us could require
us to increase our allowance for doubtful accounts in the future. In connection
with our continued expansion, we intend to offer open account terms to
additional customers, which may subject us to further credit risks, particularly
in the event that any receivables represent sales to a limited number of
customers or are concentrated in particular geographic markets. Any delays in
collecting or inability to collect our receivables could have a material adverse
effect on our business.
OUR OPERATING RESULTS FREQUENTLY VARY SIGNIFICANTLY AND RESPOND TO SEASONAL
FLUCTUATIONS IN PURCHASING PATTERNS.
Our operating results are influenced by a number of seasonal factors in the
different countries and markets in which we operate. These results may fluctuate
from period to period as a result of several factors, including:
- purchasing patterns of customers in different markets;
- the timing of introduction of new products by our suppliers and
competitors;
- variations in sales by distribution channels; and
- product availability and pricing.
Consumer electronics and retail sales tend to experience increased volumes
of sales at the end of the calendar year. This and other seasonal factors
contribute to the usual increase in our sales during the fourth quarter of our
fiscal year. Our operating results may continue to fluctuate significantly in
the future. In addition, if unanticipated events occur, including delays in
securing adequate inventories of competitive products at times of peak sales or
significant decreases in sales during these periods, it could have a material
adverse effect on our operating results.
OUR CONTINUED GROWTH DEPENDS ON RETAINING OUR CURRENT KEY EMPLOYEES AND
ATTRACTING ADDITIONAL QUALIFIED PERSONNEL.
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Our success depends in large part on the abilities and continued service of
our executive officers and other key employees. Although we have entered into
employment agreements with several of our officers and employees, we may not be
able to retain their services. We also have non-competition agreements with our
executive officers and some of our existing key personnel. However, courts are
sometimes reluctant to enforce non-competition agreements. The loss of executive
officers or other key personnel could have a material adverse effect on us.
In addition, in order to support our continued growth, we will be required
to effectively recruit, develop and retain additional qualified management. If
we are unable to attract and retain additional necessary personnel, it could
delay or hinder our plans for growth.
WE RELY TO A GREAT EXTENT ON TRADE SECRET AND COPYRIGHT LAWS AND AGREEMENTS WITH
OUR KEY EMPLOYEES AND OTHER THIRD PARTIES TO PROTECT OUR PROPRIETARY RIGHTS.
Our business success is substantially dependent upon our proprietary
business methods and software applications relating to our information systems.
We currently hold one patent relating to certain of our business methods.
Concerning other business methods and software we rely on trade secret and
copyright laws to protect our proprietary knowledge. We also regularly enter
into non-disclosure agreements with our key employees and limit access to and
distribution of our trade secrets and other proprietary information. These
measures may not prove adequate to prevent misappropriation of our technology.
Our competitors could also independently develop technologies that are
substantially equivalent or superior to our technology, thereby eliminating one
of our competitive advantages. We also have offices and conduct our operations
in a wide variety of countries outside the United States. The laws of some other
countries do not protect our proprietary rights to the same extent as do laws in
the United States. In addition, although we believe that our business methods
and proprietary software have been developed independently and do not infringe
upon the rights of others, third parties might assert infringement claims
against us in the future or our business methods and software may be found to
infringe upon the proprietary rights of others.
WE MAKE SIGNIFICANT INVESTMENTS IN THE TECHNOLOGY USED IN OUR BUSINESS AND RELY
ON THIS TECHNOLOGY TO FUNCTION EFFECTIVELY WITHOUT INTERRUPTIONS.
We have made significant investments in sophisticated and specialized
information systems technology and have focused on the application of this
technology to provide customized integrated logistics services to wireless
communications equipment manufacturers and network operators. Our sales and
marketing efforts, a large part of which are telemarketing based, are highly
dependent on computer and telephone equipment.
We anticipate that we will need to continue to invest significant amounts
to enhance our information systems in order to maintain our competitiveness and
to develop new logistics services. Our property and business interruption
insurance may not adequately compensate us for all losses that we may incur if
we lose our equipment or systems either temporarily or permanently through a
casualty or operating malfunction. In addition, a significant increase in the
costs of additional technology or telephone services that is not recoverable
through an increase in the price of our services could have a material adverse
effect on our results of operations.
OUR LABOR FORCE EXPERIENCES A HIGH RATE OF PERSONNEL TURNOVER.
Our distribution and integrated logistics services are labor-intensive, and
we experience high personnel turnover and can be adversely affected by shortages
in the available labor force in geographical areas where we operate. A
significant portion of our labor force is contracted through temporary agencies,
and a significant portion of our costs consist of wages to hourly workers.
Growth in our business, together with seasonal increases in net sales, requires
us to recruit and train personnel at an accelerated rate from time to time. We
may not be able to continue to hire, train and retain a significant labor force
of qualified individuals when needed, or at all. An increase in hourly costs,
employee benefit costs, employment taxes or commission rates could have a
material adverse effect on our operations. In addition, if the turnover rate
among our labor force increased further, we could be required to increase
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our recruiting and training efforts and costs, and our operating efficiencies
and productivity could decrease.
WE HAVE SIGNIFICANT FUTURE PAYMENT OBLIGATIONS PURSUANT TO CERTAIN LEASES AND
OTHER LONG-TERM CONTRACTS.
We lease our office and warehouse/distribution facilities as well as
certain furniture and equipment under property and personal equipment leases.
Many of these leases are for terms that exceed one year and require us to pay
significant monetary charges for early termination or breach by us of the lease
terms. We cannot be certain of our ability to adequately fund these lease
commitments from our future operations and our decision to modify, change or
abandon any of our existing facilities could have a material adverse effect on
our operations.
WE MAY BECOME SUBJECT TO SUITS ALLEGING MEDICAL RISKS ASSOCIATED WITH OUR
WIRELESS HANDSETS.
Lawsuits or claims have been filed or made against manufacturers of
wireless handsets over the past years alleging possible medical risks, including
brain cancer, associated with the electromagnetic fields emitted by wireless
communications handsets. There has been only limited relevant research in this
area, and this research has not been conclusive as to what effects, if any,
exposure to electromagnetic fields emitted by wireless handsets has on human
cells. Substantially all of our revenues are derived, either directly or
indirectly, from sales of wireless handsets.
We may become subject to lawsuits filed by plaintiffs alleging various
health risks from our products. If any future studies find possible health risks
associated with the use of wireless handsets or if any damages claim against us
is successful, it could have a material adverse effect on our business. Even an
unsubstantiated perception that health risks exist could adversely affect our
ability or the ability of our customers to market wireless handsets.
CURRENT LEGAL PROCEEDING COULD HARM OUR OPERATIONS.
We are from time to time, involved in certain legal proceedings in the
ordinary course of conducting our business. We believe there are no pending
legal proceedings in which we are currently involved which will have a material
adverse effect on our financial position.
We and certain of our executive officers, two of whom are also directors,
were named as defendants in four actions filed in June and July 1999, in the
United States District Court for the Southern District of Indiana. These actions
were subsequently consolidated by the Court into a single action. The action
asserts claims under sections 10 (b) and 20 (a) of the Securities Exchange Act
of 1934, and Rule 10b-5 of the Exchange Act, based on allegations that false and
misleading statements were rendered and/or statements were omitted concerning
our then current and future financial condition and business prospects. The
action involves a purported class of purchasers of our stock during the period
October 2, 1998 through March 10, 1999. We and the individual defendants intend
to vigorously defend these actions. The outcome of any litigation is uncertain
and it is possible that an unfavorable decision could have a material adverse
effect on our financial position, results of operations or cash flows.
THE MARKET PRICE OF OUR COMMON STOCK MAY BE VOLATILE.
The market price of our common stock has risen substantially and has
fluctuated significantly from time to time since our initial public offering in
April 1994. The trading price of our common stock could experience significant
fluctuations in the future in response to several factors, which could include
actual or anticipated variations in our quarterly operating results; the
introduction of new services, products or technologies by us, our suppliers or
our competitors; changes in other conditions or trends in the wireless
telecommunications and data industry; changes in governmental regulation; or
changes in securities analysts' estimates of our future performance or that of
our competitors or our industry in general. General market price declines or
market volatility in the prices of stocks for companies in the wireless
telecommunications and data industry or in the distribution or integrated
logistics services sectors of the wireless telecommunications and data industry
could also affect the market price of our common stock.
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USE OF PROCEEDS
We will not receive any proceeds from any sales of shares of common stock
by the selling stockholder. We have agreed to bear certain expenses in
connection with the registration of the common stock being offered and sold by
the selling stockholder.
DESCRIPTION OF CAPITAL STOCK
We are authorized to issue 100,000,000 shares of common stock, par value
$.01 per share, and 1,000,000 shares of preferred stock, par value $.01 per
share. At May 10, 2000, there were 55,595,694 shares of our common stock and no
shares of our preferred stock issued and outstanding.
COMMON STOCK
Except as required by law or by our Certificate of Incorporation, holders
of common stock are entitled to one vote for each share held of record on all
matters submitted to a vote of the holders of common stock. The holders of
common stock are not entitled to cumulative voting rights with respect to the
election of directors. Subject to preferences that may be applicable to any then
outstanding preferred stock, holders of common stock are entitled to receive
ratably such dividends as may be declared by the Board of Directors out of funds
legally available therefor. In the event of a liquidation, dissolution, or
winding up of our company, holders of common stock will be entitled to share
ratably in all assets remaining after payment of liabilities and the liquidation
preference of any then outstanding Preferred Stock. Holders of common stock have
no preemptive rights and have no right to convert their shares of common stock
into any of our other securities. There are no redemption or sinking fund
provisions applicable to the common stock. All outstanding shares of common
stock are fully-paid and nonassessable. Our Board of Directors may issue
additional authorized shares of common stock without further action by the
stockholders.
PREFERRED STOCK
Our Board of Directors has the authority, without further action by the
stockholders, to issue up to one million shares of preferred stock in one or
more series and to fix their rights, preferences, privileges and restrictions,
including dividend rights, conversion rights, voting rights, terms of
redemption, liquidation preferences, the number of shares constituting any
series or the designation of such series. The issuance of preferred stock could
adversely affect the voting power of holders of common stock and could have the
effect of delaying, deferring, or preventing a change in our control. We have no
present plan to issue any shares of preferred stock other than as it may be
issued in connection with the Stockholders Rights Plan described below.
ANTI-TAKEOVER EFFECTS OF CERTAIN PROVISIONS OF OUR BY-LAWS, STOCKHOLDERS RIGHTS
PLAN AND DELAWARE CORPORATE LAW
By-Laws. Our By-Laws contain provisions that could make it more difficult
to acquire control of us by various means, such as a tender offer, open market
purchases, a proxy contest or otherwise. For instance, our Board of Directors is
divided into three classes, as nearly equal in number as is reasonably possible,
serving staggered terms. One class of directors is elected at each annual
meeting to serve a term of three years. At least two annual meetings of
stockholders, instead of one, will be required to effect a change in a majority
of our Board of Directors. In addition, special meetings of the stockholders may
only be called by a majority of the Board of Directors or our President. Our
By-Laws establish advance notice procedures with regard to stockholder proposals
for annual or special meetings. Amendments to the staggered board provision
require a two-thirds vote of stockholders. The purposes of these provisions are
to discourage certain types of transactions which may involve an actual or
threatened change of our control and encourage persons seeking to acquire
control of us to consult first with the Board of Directors to negotiate the
terms of any proposed business combination or offer. These provisions are
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<PAGE> 14
designed to reduce our vulnerability to an unsolicited proposal for a takeover
that does not contemplate the acquisition of all outstanding shares or is
otherwise unfair to our stockholders or an unsolicited proposal for the
restructuring or sale of all or part of our company.
Stockholders Rights Plan. In February 1997, we adopted a Stockholders
Rights Plan and declared a dividend of one preferred share purchase right for
each outstanding share of common stock. The dividend was paid to holders of
record of common stock on the record date as of the close of business on
February 20, 1997. Each of these Rights entitles the registered holder to
purchase one one-thousandth of a share of our Series A Junior Participating
Preferred Stock, par value $.01 per share. Holders will be entitled to purchase
these Preferred Shares from us at a price of $115 per one one-thousandth of a
Preferred Share, subject to adjustment in certain circumstances. The description
and terms of the Rights are set forth in a Rights Agreement between us and
American Stock Transfer & Trust Company, as Rights Agent.
Rights are evidenced by and are transferable only in connection with common
stock certificates outstanding prior to the Distribution Date. The Distribution
Date is the earlier to occur of (i) ten days after a public announcement that an
Acquiring Person (a person or group of affiliated or associated persons) has
acquired beneficial ownership of 15% or more of our outstanding common stock or
(ii) ten business days (or such later date as may be determined by action of the
Board of Directors prior to such time as any person or group becomes an
Acquiring Person) after the commencement of or announcement of an intention to
commence a tender or exchange offer, the consummation of which would result in
the beneficial ownership by a person or group of 15% or more of our outstanding
common stock. As soon as practical following the Distribution Date, separate
Right Certificates evidencing the Rights will be mailed to holders of record of
common stock as of the close of business on the Distribution Date, and such
separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date and will expire
on February 20, 2007, unless extended or unless we redeem or exchange the Rights
earlier, as described below. The Rights, the Purchase Price, and the number of
Preferred Shares or other securities or property issuable upon exercise of the
Rights are subject to adjustment from time to time to prevent dilution.
Preferred Shares will not be redeemable. Each Preferred Share will be
entitled to a minimum preferential quarterly dividend payment of $1.00 per share
but will be entitled to an aggregate dividend of 1,000 times the dividend
declared per share of common stock. In the event of liquidation, the holders of
the Preferred Shares will be entitled to a minimum preferential liquidation
payment of $1.00 per share but will be entitled to an aggregate payment of 1,000
times the payment made per share of common stock. Each Preferred Share will have
1,000 votes, voting together with the Common Stock. In the event of any merger,
consolidation or other transaction in which shares of common stock are
exchanged, the holder of each Preferred Share will be entitled to receive 1,000
times the amount received per share of common stock.
If any person or group of affiliated or associated persons becomes an
Acquiring Person, each holder of a Right, other than Rights beneficially owned
by the Acquiring Person or its affiliate, associate or transferee (which will
thereafter be void), will thereafter have the right to receive that number of
shares of common stock having a market value of two times the exercise price of
the Right. If we are acquired in a merger or other business combination
transaction or if 50% or more of our consolidated assets or earning power are
sold after a person or group has become an Acquiring Person in a transaction
with such Acquiring Person or group, each holder of a Right will thereafter have
the right to receive that number of shares of common stock of the acquiring
company having a market value of two times the exercise price of the Right. In
each case, there are exceptions for transactions that have received the prior
approval of the Board of Directors.
At any time after any person or group becomes an Acquiring Person and prior
to the acquisition by such person or group of 50% or more of the outstanding
shares of our common stock, our Board of Directors may exchange the Rights
(other than Rights owned by such person or group which will have become void),
in whole or in part, at an exchange ratio of one share of common stock per Right
(subject to adjustment). At any time prior to
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<PAGE> 15
any person or group becoming an Acquiring Person, our Board of Directors may
redeem all of the outstanding Rights at a price of $.01 per Right, payable in
cash or common stock.
We can amend all of the provisions of the Rights Agreement prior to the
Distribution Date. After the Distribution Date, the provisions of the Rights
Agreement may not be amended in any manner which would adversely affect the
interests of the holders of the Rights (excluding the interests of an Acquiring
Person).
Delaware Anti-Takeover Law. We are subject to certain anti-takeover
provisions under Section 203 of the Delaware General Corporation Law. In
general, under Section 203, a Delaware corporation may not engage in any
business combination with any interested stockholder (a person that owns,
directly or indirectly, 15% or more of the outstanding voting stock of a
corporation or is an affiliate or associate of a corporation and was the owner
of 15% or more of the outstanding voting stock of the corporation at any time
within the prior three years), for a period of three years following the date
such stockholder became an interested stockholder, unless (i) prior to such date
the board of directors of the corporation approved either the business
combination or the transaction which resulted in the stockholder becoming an
interested stockholder, or (ii) upon consummation of the transaction which
resulted in the stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the corporation
outstanding at the time the transaction commenced, or (iii) on or subsequent to
such date, the business combination is approved by the board of directors and
authorized at an annual or special meeting of stockholders, and not by written
consent, by at least 66 2/3% of the outstanding voting stock which is not owned
by the interested stockholder. The restrictions imposed by Section 203 will not
apply to a corporation if the corporation's original certificate of
incorporation contains a provision expressly electing not to be governed by this
section or the corporation by action of its stockholders adopts an amendment to
its certificate of incorporation or by-laws expressly electing not to be
governed by Section 203. We have not elected out of Section 203, and thus the
restrictions imposed by Section 203 apply to us. These provision could have the
effect of discouraging, delaying or preventing a takeover of our company, which
could otherwise be in the best interest of our stockholders, and have an adverse
effect on the market price for our common stock.
TRANSFER AGENT
The transfer agent and registrar for our common stock is American Stock
Transfer & Trust Company, New York, New York.
SELLING STOCKHOLDER
The following table sets forth certain information with respect to the
Selling Stockholder:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Beneficial Ownership
of Shares of Common
Selling Stock Prior to Shares to be Sold Shares Owned % of Shares Owned
Stockholder Offering in the Offering After Offering After Offering
- ----------- -------------------- ----------------- -------------- ---------------------
Brian Firestone 765,318 382,659 382,659 Less than one percent
</TABLE>
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<PAGE> 16
PLAN OF DISTRIBUTION
We are registering shares of our common stock with this prospectus on
behalf of the selling stockholders, who include any donees and pledgees of
shares received from the selling stockholder named in this prospectus. We have
agreed to bear certain expenses in connection with the registration of the
shares of our common stock offered and being sold by the selling stockholders.
The selling stockholders will bear all brokerage commissions and similar selling
expenses, if any, attributable to sales of the shares. Sales of shares may be
affected by the selling stockholders from time to time in one or more types of
transactions (which may include block transactions) on the NASDAQ National
Market, in the over-the-counter market, in negotiated transactions, or a
combination of such methods of sale, at market prices prevailing at the time of
sale, or at negotiated prices. These transactions may or may not involve brokers
or dealers.
The selling stockholders may affect sales of shares:
- In ordinary brokerage transacting in which the broker solicits
purchasers or executes unsolicited orders, or transactions in which
the broker may acquire the share as principal and resell the shares
into the public market in any manner permitted by the selling
stockholders under this prospectus;
- In connection with the pledge of shares registered hereunder to a
broker/dealer or other pledgee to secure debts or other obligations,
and the sale of the shares so pledged upon a default;
- Through the writing or settlement of non-traded and exchange-traded
put or call option contracts, and by means of the establishment or
settlement of other hedging transactions including forward sale
transactions. In addition, the selling stockholders may loan their
shares to broker/dealers who are counterparties to hedging
transactions and such broker/dealers may sell the shares so borrowed
into the public market.
Broker-dealers may receive compensation in the form of discounts,
concessions, or commissions from the selling stockholder and/or the purchasers
of shares for whom such broker-dealers may act as agents or to whom they sell as
principal or both (this compensation to a particular broker-dealer might be in
excess of customary commissions).
The selling stockholders and any broker-dealers that act in connection with
the sale of shares might be deemed to be "underwriters" within the meaning of
Section 2(a)(11) of the Securities Act. In this case, any commissions received
by broker-dealers and any profit on the resale of the shares sold by them while
acting as principals might be deemed to be underwriting discounts or commissions
under the Securities Act. We have agreed to indemnify the selling stockholder
named in this prospectus against certain liabilities, including liabilities
arising under the Securities Act. The selling stockholders may agree to
indemnify any agent, dealer or broker-dealer that participates in transactions
involving sales of the shares against certain liabilities, including liabilities
arising under the Securities Act.
Because the selling stockholders may be deemed to be "underwriters" within
the meaning of Section 2(a)(11) of the Securities Act, the selling stockholders
will be subject to the prospectus delivery requirements of the Securities Act.
The selling stockholders also may resell all or a portion of their shares
in open market transactions in reliance upon Rule 144 under the Securities Act,
if they meet the criteria and conform to the requirements of Rule 144.
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<PAGE> 17
LEGAL MATTERS
Blank Rome Tenzer Greenblatt LLP of New York, New York has passed upon
certain legal matters with respect to the validity of the shares of common stock
being offered with this prospectus.
EXPERTS
Our consolidated financial statements and schedule incorporated by
reference or included in our Annual Report on Form 10-K for the year ended
December 31, 1999 and incorporated by reference in this prospectus and
registration statement have been audited by Ernst & Young LLP, independent
auditors, as set forth in their reports thereon, which are also incorporated
herein by reference. Our financial statements and schedule are incorporated by
reference herein in reliance upon such reports given on the authority of such
firm as experts in accounting and auditing.
ADDITIONAL INFORMATION
We are subject to the informational requirements of the Securities Exchange
Act of 1934, as amended, and in accordance therewith file reports, proxy
statements and other information with the SEC. These reports and other
information filed by us can be read and copied at the public reference
facilities maintained by the SEC at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the SEC's Regional Offices: 500
West Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and 7 World Trade
Center, 13th Floor, New York, New York 10048. You can obtain information on the
operation of the Public Reference Facilities by calling the SEC at
1-800-SEC-0330. Copies of materials can be obtained at prescribed rates from the
Public Reference Section of the SEC at 450 Fifth Street, N.W., Washington, D.C.
20549. Our electronic filings made through the SEC's Electronic Data Gathering,
Analysis and Retrieval System are publicly available through the SEC's worldwide
web site (http://www.sec.gov).
We have filed a registration statement with the SEC with respect to the
shares offered by this prospectus. This prospectus, which is filed as part of
the registration statement, does not contain all of the information set forth
in, or annexed as exhibits to, the registration statement, portions of which
have been omitted in accordance with the SEC's rules and regulations. Statements
made in this prospectus or in any document incorporated by reference into this
prospectus as to the contents of any contract, agreement or other document
referred to in the prospectus are not necessarily complete and are qualified in
their entirety by reference to such contract, agreement or other document filed
as an exhibit to the registration statement or as an exhibit to a document
incorporated by reference into the registration statement. The registration
statement, including exhibits filed with or incorporated into it, may be
inspected without charge at the public reference facilities maintained by the
SEC, and copies of such material can be obtained at prescribed rates from the
Public Reference Room of the SEC in Washington, D.C. You can retrieve copies of
the registration statement through the SEC's Electronic Data Gathering, Analysis
and Retrieval System through the SEC's worldwide web site at http://www.sec.gov.
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<PAGE> 18
You should rely only on the information contained in this Prospectus.
Neither Brightpoint Inc. nor the selling stockholder has authorized anyone to
provide you with different information. No offers to sell or sales of the shares
are being made in any jurisdiction where the offer or sale is not permitted. You
should not assume that the information contained in this prospectus is accurate
as of any date other than the date of this prospectus.
TABLE OF CONTENTS
Page
Special Information Regarding Forward Looking
Information........................................... 2
Incorporation of Certain Documents
By Reference.......................................... 2
Prospectus Summary...................................... 3
Risk Factors............................................ 3
Use of Proceeds......................................... 11
Description of Capital Stock............................ 11
Selling Stockholder..................................... 13
Plan of Distribution.................................... 14
Legal Matters........................................... 15
Experts................................................. 15
Additional Information.................................. 15
382,659 SHARES
COMMON STOCK
BRIGHTPOINT, INC.
-------------
PROSPECTUS
-------------
, 2000
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<PAGE> 19
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION*.
The following are the estimated expenses of the issuance and distribution
of the securities being registered, all of which will be paid by the Registrant:
SEC registration .............................................. $ 1,143.57
Printing expenses ............................................. 5,000.00
Legal fees and expenses ....................................... 10,000.00
Accounting fees and expenses .................................. 15,000.00
Miscellaneous ................................................. 3,856.43
-----------
Total ................................................. $ 35,000.00
===========
- ----------
* All amounts are estimated except the first item.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 145 of the General Corporation Law of the State of Delaware
provides for the indemnification of officers and directors under certain
circumstances against expenses incurred in successfully defending against a
claim and authorizes Delaware corporations to indemnify their officers and
directors under certain circumstances against expenses and liabilities incurred
in legal proceedings involving such persons because of their being or having
been an officer or director.
Section 102(b) of the Delaware General Corporation Law permits a
corporation, by so providing in its certificate of incorporation, to eliminate
or limit director's liability to the corporation and its stockholders for
monetary damages arising out of certain alleged breaches of their fiduciary
duty. Section 102(b)(7) provides that no such limitation of liability may affect
a director's liability with respect to any of the following: (i) breaches of the
director's duty of loyalty to the corporation or its stockholders; (ii) acts or
omissions not made in good faith or which involve intentional misconduct of
knowing violations of law; (iii) liability for dividends paid or stock
repurchased or redeemed in violation of the Delaware General Corporation Law; or
(iv) any transaction from which the director derived an improper personal
benefit. Section 102(b)(7) does not authorize any limitation on the ability of
the corporation or its stockholders to obtain injunctive relief, specific
performance or other equitable relief against directors.
Article TENTH of the registrant's Certificate of Incorporation provides
that no director shall be personally liable to the registrant or any of its
stockholders for monetary damages for breach of fiduciary duty as a director
except to the extent such elimination or limitation is prohibited by the
Delaware General Corporation Law. In addition, Article NINTH of the registrant's
Certificate of Incorporation and Article XX of the By-Laws of the registrant
provide in substance that, to the fullest extent permitted by Delaware law, each
director and officer shall be indemnified by the registrant against reasonable
costs and expenses, including attorneys fees, and any liabilities which may be
incurred in connection with any action to which he may be made a party by reason
of having been a director or officer of the registrant. The indemnification
provided by the registrant's By-Laws is not deemed exclusive of or in any way to
limit any other rights which any person seeking indemnification may be entitled.
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<PAGE> 20
The registrant has also entered into certain agreements wherein it has
agreed, subject to certain limitations, to indemnify its officers and directors
for judgments, fines, assessments, interest and other charges they may incur as
a party, witness or other participant in any threatened, pending or completed
actions, suits or proceeding by reason of their acting as an officer, director,
employee or agent of the registrant or any of its subsidiaries, provided that
the indemnified party acted in good faith in a manner such person believed to be
in or not opposed to the best interests of the registrant and, with respect to
certain matters, had no reasonable cause to believe that his conduct was
unlawful. The agreements also provide that upon a "change of control" of the
registrant, as defined in the agreements, the registrant will be required to
designate and set aside certain funds for possible future payments of the
indemnified parties pursuant to the agreements.
Insofar as indemnification for liabilities under the Securities Act of 1933
may be permitted to directors, officers or persons controlling us pursuant to
the foregoing provisions, we have been informed that in the opinion of the
Commission, such indemnification is against public policy as expressed in the
Securities Act and is therefore unenforceable.
ITEM 16. EXHIBITS
(a) Exhibits
Exhibit Number Description
- -------------- -----------
5 Opinion of Blank Rome Tenzer Greenblatt LLP as to the legality of the
securities being registered
23.1 Consent of Ernst & Young LLP
23.2 Consent of Blank Rome Tenzer Greenblatt LLP, included in opinion filed
as Exhibit 5
24 Power of Attorney, included in the signature page of this Registration
Statement
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act; and
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective registration statement; and
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<PAGE> 21
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
provided, however, that paragraphs (i) and (ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 and Section 15(d) of the Exchange Act that are incorporated by
reference in the registration statement.
(2) That, for purposes of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering as such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities
Act, each filing of the registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Exchange Act (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(5) That, insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-3
<PAGE> 22
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements of filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, in the City of
Indianapolis, State of Indiana, on the 10th day of May, 2000.
BRIGHTPOINT, INC.
By:/s/ Robert J. Laikin
---------------------
Robert J. Laikin,
Chief Executive Officer
Each person whose signature appears below hereby authorizes each of Robert
J. Laikin and J. Mark Howell or either of them as his true and lawful
attorney-in-fact with full power of substitution to execute in the name and on
behalf of each person, individually and in each capacity stated below, and to
file, any and all amendments to this Registration Statement, including any and
all post-effective amendments thereto.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-3 was signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Robert J. Laikin Chairman of the Board, May 10, 2000
- -------------------- Chief Executive Officer and Director
Robert J. Laikin (Principal Executive Officer)
/s/ J. Mark Howell President, Chief Operating Officer and Director May 10, 2000
- ------------------
J. Mark Howell
/s/ Phillip A. Bounsall Executive Vice President and Chief May 10, 2000
- ----------------------- Financial Officer (Principal
Phillip A. Bounsall Financial Officer)
/s/ John P. Delaney Vice President and Chief Accounting Officer May 10, 2000
- ------------------- (Principal Accounting Officer)
John P. Delaney
/s/ John W. Adams Director May 10, 2000
- -----------------
John W. Adams
/s/ Rollin M. Dick Director May 10, 2000
- ------------------
Rollin M. Dick
/s/ Stephen H. Simon Director May 10, 2000
- --------------------
Stephen H. Simon
/s/ Todd H. Stuart Director May 10, 2000
- ------------------
Todd H. Stuart
/s/ Robert F. Wagner Director May 10, 2000
- --------------------
Robert F. Wagner
</TABLE>
II-4
<PAGE> 1
Exhibit 5
LETTERHEAD OF BLANK ROME
TENZER GREENBLATT LLP
May 10, 2000
Brightpoint, Inc.
6402 Corporate Drive
Indianapolis, Indiana 46278
Gentlemen:
You have requested our opinion with respect to the offer and sale by a
selling stockholder of Brightpoint, Inc., a Delaware corporation (the "Company")
pursuant to a Registration Statement (the "Registration Statement") on Form S-3
being filed by the Company under the Securities Act of 1933, as amended (the
"Act"), of up to 382,659 shares (the "Shares") of common stock, par value $.01
per share, of the Company.
We have examined originals, or copies certified or otherwise identified to
our satisfaction, of such documents and corporate and public records as we deem
necessary as a basis for the opinion hereinafter expressed. With respect to such
examination, we have assumed the genuineness of all signatures appearing on all
documents presented to us as originals, and the conformity to the originals of
all documents presented to us as conformed or reproduced copies. Where factual
matters relevant to such opinion were not independently established, we have
relied upon certificates of executive officers and responsible employees and
agents of the Company.
Based upon the foregoing, it is our opinion that the Shares are duly
authorized, validly issued and fully paid and non-assessable.
We hereby consent to the use of this opinion as Exhibit 5 to the
Registration Statement, and to the use of our name as your counsel in connection
with the Registration Statement and in the Prospectus forming a part thereof. In
giving this consent, we do not thereby concede that we come within the
categories of persons whose consent is required by the Act or the General Rules
and Regulations promulgated thereunder.
Very truly yours,
/s/ Blank Rome Tenzer Greenblatt LLP
BLANK ROME TENZER GREENBLATT LLP
<PAGE> 1
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP
We consent to the reference to our firm under the caption "Experts" in this
Registration Statement (Form S-3) and related Prospectus of Brightpoint, Inc.
pertaining to the registration of 382,659 shares of Brightpoint, Inc. common
stock and to the incorporation by reference therein of our reports dated January
24, 2000, with respect to the consolidated financial statements of Brightpoint,
Inc. incorporated by reference in its Annual Report (Form 10-K) for the year
ended December 31, 1999 and the related financial statement schedule included
therein, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Indianapolis, Indiana
May 9, 2000
