As filed with the Securities and Exchange Commission on May 23, 2011

Registration No. 333-173506

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Amendment No. 1

Form S-1

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

BRIGHTSTAR CORP.

(Exact Name of Registrant as Specified in Its Charter)


Delaware	5065	33-0774267
(State or Other Jurisdiction of Incorporation or Organization)	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification Number)

9725 N.W. 117th Ave.
Miami, Florida 33178
(305) 421-6000
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)

R. Marcelo Claure
Chairman and
Chief Executive Officer
Brightstar Corp.
9725 N.W. 117th Ave.
Miami, Florida 33178
(305) 421-6000
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service)

Copies to:


Michael Kaplan Davis Polk & Wardwell LLP 450 Lexington Avenue New York, New York 10017 (212) 450-4000		Clayton E. Parker K&L Gates LLP 200 South Biscayne Boulevard Suite 3900 Miami, Florida 33131 (305) 539-3300		Kris F. Heinzelman William J. Whelan, III Cravath, Swaine & Moore LLP Worldwide Plaza 825 Eighth Avenue New York, New York 10019 (212) 474-1000

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.

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, check the following box. o

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) 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. o

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. o

If this form is a post-effective amendment filed pursuant to Rule 462(d) 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. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer o	Accelerated filer o	Non-accelerated filer þ	Smaller reporting company o

(Do not check if a smaller reporting company)

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.

The information in this preliminary prospectus is not complete and may be changed. We and the selling stockholders may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities, and we and the selling stockholders are not soliciting offers to buy these securities in any jurisdiction where the offer or sale is not permitted.

Subject to Completion, Dated May 23, 2011

PRELIMINARY PROSPECTUS

Class A Common Stock

This is an initial public offering of Class A common stock by Brightstar Corp. We are selling shares of our Class A common stock. The selling stockholders identified in this prospectus, which include R. Marcelo Claure, our Chairman and Chief Executive Officer, and Lindsay Goldberg LLC (“Lindsay Goldberg”), our sponsor, are selling an additional shares of our Class A common stock. We will not receive any proceeds from the sale of shares by the selling stockholders. This is our initial public offering and no public market currently exists for our shares. The estimated initial public offering price is between $ and $ per share.

Following this offering, we will have two classes of authorized common stock, Class A common stock and Class B common stock. The rights of the holders of Class A common stock and Class B common stock will be identical, except with respect to voting and conversion. Each share of Class A common stock will be entitled to one vote per share. Each share of Class B common stock will be entitled to 5 votes per share, except in limited circumstances. Following the completion of this offering, Mr. Claure will beneficially own 100% of our outstanding Class B common stock, representing approximately % of the combined voting power of our outstanding common stock and approximately % of our total equity ownership assuming the underwriters’ option to purchase additional shares is not exercised.

We intend to apply to have our Class A common stock listed on The Nasdaq Stock Market under the symbol “STAR.”

Investing in our Class A common stock involves risks. See “Risk Factors” beginning on page 15.


	Per Share	Total

Initial public offering price	$	$
Underwriting discounts	$	$
Proceeds, before expenses, to Brightstar Corp.	$	$
Proceeds, before expenses, to selling stockholders	$	$

To the extent that the underwriters sell more than shares of Class A common stock, the underwriters have the option to purchase up to an additional shares from Brightstar Corp. and shares from the selling stockholders at the initial public offering price less the underwriting discounts.

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 underwriters expect to deliver the shares against payment in New York, New York on , 2011.


Goldman, Sachs & Co.	J.P. Morgan


Barclays Capital	Credit Suisse	Jefferies


RBC Capital Markets	Stifel Nicolaus Weisel

, 2011

TABLE OF CONTENTS


	Page

Prospectus Summary		1
Risk Factors		15
Cautionary Statement Concerning Forward-Looking Statements		34
Use of Proceeds		35
Dividend Policy		36
Capitalization		37
Dilution		39
Selected Consolidated Financial and Other Data		41
Management’s Discussion and Analysis of Financial Condition and Results of Operations		43
Business		92
Management		112
Compensation Discussion and Analysis		119
Certain Relationships and Related Party Transactions		141
Principal and Selling Stockholders		143
Description of Capital Stock		145
Material U.S. Federal Tax Consequences for Non-U.S. Holders		148
Shares Eligible for Future Sale		150
Underwriting		153
Legal Matters		158
Experts		158
Where You Can Find Additional Information		158
Index to Consolidated Financial Statements		F-1
EX-23.1

Unless the context indicates otherwise, “Brightstar,” the “company,” “we,” “us” and “our” in this prospectus refer to Brightstar Corp. and its subsidiaries. We have not authorized anyone to provide any information other than that contained in this prospectus or in any free writing prospectus prepared by or on behalf of us or to which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We and the selling stockholders have not authorized anyone to provide you with additional or different information. We and the selling stockholders are offering to sell, and seeking offers to buy, shares of Class A common stock only in jurisdictions where offers and sales are permitted. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of the Class A common stock.

Until , 2011 (25 days after the commencement of the offering), all dealers that buy, sell or trade in our Class A common stock, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers’ obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this prospectus. This summary may not contain all of the information that you should consider before deciding to invest in our Class A common stock. You should read this entire prospectus carefully, including our consolidated financial statements and related notes thereto and the information set forth under the sections “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”, in each case included elsewhere in this prospectus.

Overview

We are a leading global services company focused on enhancing the performance and profitability of the key participants in the wireless device value chain: manufacturers, operators, retailers and enterprises. We provide a comprehensive range of customized services consisting of value-added distribution, supply chain, retail and enterprise and consumer services. Our services help our customers manage the growing complexity of the wireless device supply chain and allow them to increase the number and type of wireless devices they sell, expand the number of locations at which they sell them and drive supply chain efficiencies which minimize their costs and therefore improve profitability. In addition, our services help our customers generate demand for wireless devices and decrease the time between purchasing and selling of devices which drives incremental revenues and profits for our customers. We believe that our global presence, scale and position as a key participant in the wireless ecosystem provide us with unique insight into the entire wireless device value chain and enhance our ability to offer differentiated, value-added services to our customers. We currently offer over 100 individual services in 50 countries across six continents, and we intend to continue innovating and adding services that deliver value to our customers.

We offer the following service categories:


	•	Value-Added Distribution Services are provided to manufacturers of wireless devices and related accessories. Our services include product distribution, transportation and delivery, order management, light manufacturing and assembly, and marketing and demand generation.


	•	Supply Chain Services are provided to manufacturers, operators and retailers. Our services include product lifecycle management, device sourcing, business intelligence, such as demand and pricing trends, and supply chain optimization services, such as logistics associated with the distribution and return of wireless devices.


	•	Retail Services are provided to manufacturers, operators, retailers and enterprises. Our services include wireless product management, portfolio management with virtual inventory and sales force training and management.


	•	Enterprise and Consumer Services are provided to manufacturers, operators, retailers and enterprises. Our services include device activation, customized billing and wireless administration software, and handset protection insurance.

Our customers are some of the leading companies in the wireless device value chain. Among others, our customers include manufacturers such as LG, Motorola, Nokia, RIM and Samsung; operators such as America Movil, Iusacell, Movilnet, Telefonica and Telstra; retailers such as Best Buy, Walmart and Wireless Advocates; and enterprises such as PC Connection. Over 90% of our revenue is derived from sales of wireless devices.

For the year ended December 31, 2010, our revenue grew 70% to $4.6 billion relative to the year ended December 31, 2009, and we generated Adjusted EBITDA (as defined below) of $141.2 million, net income of $39.8 million and Adjusted net income (as defined below) of $60.6 million as compared to Adjusted EBITDA of $111.4 million, net income of $58.3 million and Adjusted net income of $58.7 million in the year ended December 31, 2009. For a reconciliation of Adjusted EBITDA and Adjusted net income to net income, see “— Summary Consolidated Financial and Other Data.”

Wireless Industry Overview

The wireless industry is large and growing, and encompasses an increasingly broad and complex array of wireless devices, including feature phones, smartphones, e-readers and tablets, and their related accessories. The primary drivers of growth and increasing complexity are the rising number of wireless device users, a larger number of wireless ecosystem participants, greater levels of demand for data applications and mobile Internet access, and the emergence of a wide range of feature-rich wireless and other activatable devices with a broad mix of voice and data service plans and shortening product lifecycles. There are more than 700 operators globally, multiple network communications standards, various wireless device distribution channels and an increasing number of wireless device models with customized application functionalities for specific customers.

According to Gartner Inc. (“Gartner”), approximately 1.2 billion wireless phones were shipped in 2009, a number which is expected to increase to approximately 2.4 billion in 2015, representing a 11.9% compounded annual growth rate (“CAGR”). The largest growth area is smartphones which, according to Gartner, is expected to grow from 172.4 million devices sold in 2009 to 1,104.9 million devices sold in 2015, representing a 36.3% CAGR. In addition, tablets and e-readers are also becoming increasingly popular with consumers. According to Gartner, tablet computer shipments are expected to grow from 17.6 million units in 2010, the first year for which Gartner industry data is available for tablet computer shipments, to 294.1 million units in 2015, representing a 75.6% CAGR.

The proliferation of new technologies and wireless devices and the increasing velocity of these new product introductions are resulting in the following key trends:


	•	Manufacturers needing to introduce new wireless devices to the market at a faster rate;


	•	Operators needing to meet customers’ demands for increased choice;


	•	Retailers needing to efficiently sell an increasingly large and rapidly changing set of available devices; and


	•	Enterprises needing to reduce the cost of and simplify the management of their wireless devices and monthly rate plans.

We believe that these differing challenges and priorities will become more prominent given the accelerating pace of technological innovation, the number of new market participants and continued growth of the wireless ecosystem and that they will translate into growing opportunities for specialized providers of outsourced services who are a key participant of the wireless device value chain.

Our Value Proposition for the Key Participants in the Wireless Ecosystem

We provide a broad portfolio of innovative services that help our customers around the world optimize their wireless supply chains and better manage the ongoing complexity in the wireless ecosystem.


	•	*Manufacturers.* We offer manufacturers a suite of services to help them move their products to market faster and to more locations around the world. Our services enable them to focus on their core competencies and help extend their reach, optimize their inventory levels and further drive increased profitability and market share.


	•	*Operators.* We provide operators with a comprehensive set of services to optimize their product selection and assist them in sourcing products at attractive pricing and meeting their delivery requirements in different markets. Our tools and services help operators improve the execution of their core business strategy, which is centered on managing the wireless customer’s experience and maximizing ARPU.


	•	*Retailers.* We provide retailers with services that improve the profitability and performance of their wireless device sales, both in-store and online. Our services help retailers simplify management of this category, analyze consumer habits and trends and ensure that products


		which are in demand are delivered to specified retail locations within targeted timeframes, and sold at competitive prices, to maximize sales and profitability.


	•	*Enterprises.* We provide small and medium businesses, enterprises, government organizations and each of their end users with cost-effective wireless voice and data communication devices through their preferred retailer or IT reseller. Our tools and services assist enterprises (through their IT reseller service providers) and consumers (through their retail environments) by simplifying the procurement, activation and administration of their wireless devices.

Our Competitive Strengths


	•	*Large, Global Services Provider for the Wireless Ecosystem.* We are present in 50 countries on six continents and believe we have a leading global distribution infrastructure platform to support the wireless device industry. Our extensive experience, infrastructure, scale and local reach create a significant competitive advantage over regional competitors because we are able to decrease the delivery time of wireless devices and provide our customers with increased visibility into their supply chain.


	•	*Strong Relationships with Manufacturers, Operators, Retailers and Enterprises.* We have relationships with over 150 manufacturers, 180 network operators, 15,000 mass retailers and 4,800 technology value-added resellers, including some of the leading names in the wireless ecosystem. Our position as a key participant in the wireless device value chain and our extensive customer relationships, coupled with our wireless expertise, global footprint and scale, enable us to improve the efficiency of interactions among different participants of the wireless device value chain, hence providing significant value for our customers.


	•	*Differentiated Services Offerings.* We have been successful at leveraging our global infrastructure and our wireless industry knowledge and data to provide customers with innovative, differentiated and targeted solutions. We work closely with our customers to create tailored services to meet our customers’ particular needs. By consistently delivering additional service offerings to our customers, we become part of our customers’ supply chains, creating stronger customer relationships.


	•	*Innovative Technology-Based Service Platform.* Our technology-based service platform provides us with extensive real-time data across the wireless device value chain and enables us to provide consulting services and tools to our customers for better decision making. Our technology has been developed internally over time and is designed to layer onto our customers’ own technology infrastructure. Our information technology tools allow us to initiate a relationship with a customer on a targeted basis, with selected solutions, and enable us to expand our services to the customer over time.


	•	*Strategically Positioned to Anticipate Industry Opportunities.* Our visibility into the wireless device value chain allows us to anticipate and capitalize on profitable growth opportunities. Our global business model enables us to leverage our learning and observations from one region to another to anticipate customer needs and associated business opportunities.


	•	*Innovative Culture and Management Team with a Successful Track Record.* Our management team, led by our Chairman, Chief Executive Officer and largest stockholder, R. Marcelo Claure, has extensive industry experience. Our management team has developed a culture that emphasizes innovation, which has enabled us to grow and diversify our business and enhance the value proposition for our customers.

Our Strategy

We intend to be the leading global services provider for the wireless device value chain. Key elements of our strategy include:


	•	Continue to leverage our global infrastructure, scale and strong customer relationships to expand our services offerings;


	•	Expand into additional high growth geographies;

	•	Increase the number of services we provide our existing customers and enter into new customer relationships; and

	•	Continue to pursue strategic partnerships, investments and acquisitions to expand our services offering as well as our geographic footprint.

Recent Development

On April 11, 2011, we acquired eSecuritel, a leading provider of cell phone and wireless products insurance services. The acquisition will combine eSecuritel’s suite of cell phone protection and replacement programs, proprietary IT systems and processes with our global logistics, device sourcing and IT customization capabilities. We expect eSecuritel’s offerings will further enhance our robust platform of services and drive growth in our business.

Risks Related to Our Business

Please read the section entitled “Risk Factors” for a discussion of some of the factors you should carefully consider before deciding to invest in our Class A common stock. Some of the important risks include:


	•	we depend on a limited number of manufacturer customers to provide us with competitive products at reasonable prices and of good quality,

	•	we may experience a loss of or reduction in orders from principal customers or a reduction in the prices we are able to charge these customers,

	•	our business depends on the continued tendency of manufacturers, operators, retailers and enterprises to outsource aspects of their business to us in the future,

	•	our business could be harmed by fluctuations in regional demand patterns and economic factors,

	•	an economic downturn could negatively impact our business,

	•	we may have difficulty collecting our accounts receivable,

	•	we rely on our manufacturer customers to provide trade credit terms to adequately fund our ongoing operations and product purchases,

	•	we operate a global business that exposes us to risks associated with international activities,

	•	we conduct a substantial amount of business in Venezuela,

	•	our operating results vary frequently and significantly in response to seasonal purchasing pattern fluctuations,

	•	we are highly dependent on our Chairman and Chief Executive Officer and management team and the loss of our executive officers and key personnel could impede our ability to implement our strategy,


	•	we have identified material weaknesses in our internal controls over financial reporting which, if not successfully remediated, could cause us to fail to timely report our financial results, prevent fraud and avoid material misstatements in our financial statements, and

	•	the voting power of our capital stock will be concentrated in our Chairman and Chief Executive Officer, which will limit your ability to influence corporate matters.

Corporate Information

Brightstar Corp. was founded by our Chairman and Chief Executive Officer, R. Marcelo Claure, and David Peterson in October 1997. In June 2007, Lindsay Goldberg acquired an interest in us by purchasing shares of our Series D Redeemable Convertible Preferred Stock.

Our principal executive offices are located at 9725 N.W. 117th Ave., Miami, Florida 33178, and our telephone number is (305) 421-6000. Our website is www.brightstarcorp.com. The information contained on our website or that can be accessed through our website will not be deemed to be incorporated into this prospectus or the registration statement of which this prospectus forms a part, and investors should not rely on any such information in deciding whether to purchase our Class A common stock.

Industry and Market Data

We obtained the industry, market and competitive position data throughout this prospectus from our own internal estimates and research as well as from industry and general publications and research, surveys and studies conducted by third parties. Industry publications, studies and surveys generally state that they have been obtained from sources believed to be reliable, although they do not guarantee the accuracy or completeness of such information. While we believe that each of these studies, surveys and publications is reliable, we have not independently verified market and industry data from third-party sources. While we believe our internal company estimates and research are reliable and the market definitions are appropriate, neither such research nor these definitions have been verified by any independent source.

Some of the independent industry publications referred to in this prospectus are copyrighted and, in such circumstances, we have obtained permission from the copyright owners to refer to such information in this prospectus. In particular, the reports issued by Gartner described in this prospectus represent data, research, opinions or viewpoints published by Gartner as part of a syndicated subscription service available only to its clients and are not representations of fact. We have been advised by Gartner that each Gartner report speaks as of its original publication date (and not as of the date of this prospectus) and the opinions expressed in the Gartner reports are subject to change without notice. The discussion above does not disclaim in any manner our responsibilities with respect to the disclosures contained in this prospectus.

The Offering


Class A common stock offered by us		shares

Class A common stock offered by the selling stockholders		shares

Total Class A common stock offered		shares

Class A common stock to be outstanding after this offering		shares

Option to purchase additional shares of Class A common stock		shares by us and shares by the selling stockholders

Class B common stock to be outstanding after this offering		shares

Total common stock to be outstanding after this offering		shares

Voting rights		Following this offering, the holders of Class A common stock will be entitled to one vote per share, and the holder of Class B common stock will be entitled to 5 votes per share, except with respect to the election of any director that is intended by our board of directors to be designated as “independent.” With respect to the election of such independent directors, holders of Class A and Class B common stock will be entitled to one vote per share and will vote together as a single class. Upon the consummation of this offering, we intend to have at least three independent directors. In addition, in the event of (a) the merger or sale of the company or all or substantially all of the assets of the company, (b) the liquidation, dissolution or winding up of the company or (c) any amendment to our certificate of incorporation that would increase the authorized capital stock of the company, Class B common stock will be entitled to one vote per share.


		Shares of Class B common stock are convertible at any time on a share-for-share basis into shares of Class A common stock. In the event that (1) Mr. Claure beneficially owns shares of our common stock representing less than 20% of the total number of shares outstanding or (2) the company is no longer certified as a minority business enterprise by the National Minority Supplier Development Council, the Class B common stock will automatically convert to Class A common stock. Currently, the company is certified as a minority business enterprise by the National Minority Supplier Development Council. In addition, in the event Mr. Claure sells, disposes or otherwise transfers his shares of Class B common stock to a third party, such Class B common stock will automatically convert to Class A common stock.


		Holders of our Class A common stock and our Class B common stock will vote together as a single class on all matters submitted to a vote of our stockholders.

		Following this offering, assuming no exercise of the underwriters’ option to purchase additional shares, (1) holders of Class A common stock will control approximately % of the combined voting power of our outstanding common stock and approximately % of our total equity ownership and (2) Mr. Claure, through his holding of 100% of our outstanding Class B common stock, will control approximately % of the combined voting power of our outstanding common stock and approximately % of our total equity ownership.

		If the underwriters exercise their option to purchase additional shares in full, (1) holders of Class A common stock will control approximately % of the combined voting power of our outstanding common stock and approximately % of our total equity ownership and (2) Mr. Claure, through his holding of 100% of our outstanding Class B common stock, will control approximately % of the combined voting power of our outstanding common stock and approximately % of our total equity ownership. See “Description of Capital Stock — Voting Rights.”

		With the exception of voting rights and the conversion features of the Class B common stock, holders of Class A and Class B common stock have identical rights. See “Description of Capital Stock — Common Stock” for a description of the material terms of our common stock.


Use of proceeds		Our net proceeds from this offering will be approximately $ million, or approximately $ million if the underwriters exercise their option to purchase additional shares in full, assuming an initial offering price of $ per share, the midpoint of the range set forth on the cover page of this prospectus. We intend to use $ million of the net proceeds from this offering to pay accrued dividends on our redeemable convertible preferred stock, including $ to Lindsay Goldberg, an affiliate of the company, and will use the remainder for general corporate purposes. We will not receive any proceeds from the shares of Class A common stock being sold by the selling stockholders identified in this prospectus, which include Mr. Claure and Lindsay Goldberg.


Dividend policy		We do not intend to pay dividends on our Class A or Class B common stock. We plan to retain any earnings for use in the operation of our business and to fund future growth.

Risk factors		See “Risk Factors” for a discussion of factors you should consider before investing in our Class A common stock.

Proposed Nasdaq Stock Market symbol		“STAR”

Unless we specifically state otherwise, the share information in this prospectus is as of March 31, 2011, and reflects or assumes:


	•	the conversion of shares of our common stock owned by Mr. Claure into shares of Class A common stock and shares of Class B common stock, and the conversion of shares of our common stock owned by other shareholders into shares of Class A common stock;

	•	the conversion of all our redeemable convertible preferred stock (at the conversion ratio of one to one) into shares of Class A common stock upon the completion of this offering;

	•	the shares of Class A common stock issuable upon exercise of outstanding options, at a weighted average exercise price of $ per share, and an additional shares of Class A common stock received for issuance pursuant to our compensation plans, are excluded; and

	•	the underwriters’ option to purchase up to an additional shares of Class A common stock from us and up to an additional shares of Class A common stock from the selling stockholders is not exercised.

Summary Consolidated Financial and Other Data

The following is our summary consolidated financial and other data, which should be read in conjunction with, and is qualified by reference to, “Use of Proceeds,” “Capitalization,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and notes thereto included elsewhere in this prospectus. The consolidated statements of operations data for the years ended December 31, 2008, 2009 and 2010 are derived from, and qualified by reference to, our audited consolidated financial statements and notes thereto included elsewhere in this prospectus and should be read in conjunction with those consolidated financial statements and notes thereto. The consolidated statement of operations data for the three-month periods ended March 31, 2010 and 2011 and the balance sheet data as of March 31, 2011 are derived from, and qualified by reference to, our unaudited interim consolidated financial statements and include all adjustments, consisting of normal and recurring adjustments that we consider necessary for a fair presentation of the financial position as of such date and results of operations for such periods. Operating results for the three months ended March 31, 2011 are not necessarily indicative of the results that may be expected for the full year.


	Year Ended December 31,									Three Months Ended March 31,
	2008			2009			2010			2010			2011
										(Unaudited)
	(In thousands, except share and per share data)

Consolidated Statements of Operations Data:
Revenue	$	3,550,165		$	2,718,652		$	4,612,863		$	767,377		$	1,267,874
Cost of revenue		3,254,167			2,354,016			4,218,979			682,678			1,157,310

Gross profit		295,998			364,636			393,884			84,699			110,564

Operating expenses:
Selling, general and administrative		174,287			161,806			235,239			46,788			65,278
Provision for bad debts		2,736			6,435			8,785			9,462			(607	)
Depreciation and amortization		9,917			13,457			11,913			2,611			3,389
Public offering expenses		—			—			7,333			5,400			—

Total operating expenses		186,940			181,698			263,270			64,261			68,060

Operating income		109,058			182,938			130,614			20,438			42,504

Other income (expenses):
Interest income		14,206			21,278			7,139			1,826			1,460
Interest expense		(34,746	)		(17,102	)		(29,025	)		(5,798	)		(13,858	)
Other income (expenses), net		(923	)		(3,459	)		2,159			8			1,805
Foreign exchange losses, net		(25,117	)		(80,915	)		(33,263	)		(17,237	)		(2,486	)

Total other expenses		(46,580	)		(80,198	)		(52,990	)		(21,201	)		(13,079	)

Income from continuing operations before provision for income taxes		62,478			102,740			77,624			(763	)		29,425
Provision for income taxes		35,402			46,999			36,938			3,337			10,755

Income from continuing operations		27,076			55,741			40,686			(4,100	)		18,670
(Loss) income from discontinued operations, net of taxes		(14,304	)		2,595			(921	)		(9	)		(32	)

Net income		12,772			58,336			39,765			(4,109	)		18,638
Less: Net income attributable to non-controlling interest		18,107			4,095			2,385			331			965

Net (loss) income attributable to Brightstar Corp.	$	(5,335	)	$	54,241		$	37,380		$	(4,440	)	$	17,673


	Year Ended December 31,								Three Months Ended March 31,
	2008			2009		2010			2010			2011
									(Unaudited)
	(In thousands, except share and per share data)

Basic earnings per share for common stock(1):
Income from continuing operations attributable to Brightstar Corp. common stockholders	$	0.50		$	0.83	$	0.35		$	(0.59	)	$	0.30
(Loss) income from discontinued operations attributable to Brightstar Corp. common stockholders		(0.79	)		0.07		(0.03	)		—			—

Net (loss) income attributable to Brightstar Corp. common stockholders	$	(0.29	)	$	0.90	$	0.32		$	(0.59	)	$	0.30

Pro forma net (loss) income attributable to Brightstar Corp. common stockholders(2)						$						$

Diluted earnings per share for common stock(1):
Income from continuing operations attributable to Brightstar Corp. common stockholders	$	0.20		$	0.78	$	0.35		$	(0.59	)	$	0.29
(Loss) income from discontinued operations attributable to Brightstar Corp. common stockholders		(0.41	)		0.06		(0.03	)		—			—

Net (loss) income attributable to Brightstar Corp. common stockholders	$	(0.21	)	$	0.84	$	0.32		$	(0.59	)	$	0.29

Pro forma net (loss) income attributable to Brightstar Corp. common stockholders(2)						$						$

Weighted average number of common shares outstanding:
Basic		18,134,166			18,163,037		18,181,347			18,178,538			18,182,267

Diluted		35,046,068			20,863,930		18,586,404			18,178,538			18,914,897

Other Financial Data(3):
Adjusted gross profit	$	295,998		$	279,040	$	382,680		$	71,703		$	110,564
Adjusted EBITDA		118,247			111,424		141,192			15,627			48,456
Adjusted net income		12,299			58,742		60,561			6,742			20,304


	As of March 31, 2011
				Pro Forma, As
	Actual		Pro Forma(4)	Adjusted(5)
			(Unaudited)
	(In thousands)

Balance Sheet Data
Cash and cash equivalents	$	102,541	$	$
Accounts receivable, net		1,143,762
Inventory		758,123
Total assets		2,385,598
Total debt (including current portions)(6)		450,331
Total liabilities		1,794,378
Total redeemable convertible preferred stock		415,359
Total stockholders’ equity		175,861


(1)		We calculate basic earnings per share using the two-class method in accordance with ASC 260 Earnings Per Share. This requires the income per share for common stock and participating securities to be calculated assuming 100% of our earnings are distributed as dividends to holders of common stock and participating securities based on their respective dividend rights, even though we do not anticipate distributing 100% of our earnings as dividends. For the basic earnings per share calculation, income from continuing operations available to Brightstar common stockholders, discontinued operations and net income attributable to Brightstar common stockholders are allocated pro rata between our weighted outstanding common stock and our weighted outstanding participating securities. Net losses are allocated completely to common stock since there is no legal obligation for the participating securities to fund losses.

		Basic earnings per share attributable to common stockholders is computed by dividing earnings applicable to income from continuing operations available to Brightstar common stockholders, discontinued operations and net income attributable to Brightstar common stockholders by the weighted-average number of common shares. Income attributable to common stockholders is net of the dividends relating to redeemable convertible preferred stock. See Note 2 to our consolidated financial statements included elsewhere in this prospectus.

(2)		“Pro forma” reflects (i) the conversion of shares of our common stock into shares of Class A common stock and shares of Class B common stock, (ii) the conversion of our redeemable convertible preferred stock into shares of Class A common stock and (iii) the issuance and sale of shares of Class A common stock by us in this offering at an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover page of this prospectus, and the application of the net proceeds of the offering, after deducting estimated underwriting discounts and offering expenses payable by us, as set forth under “Use of Proceeds.”

(3)		Adjusted gross profit is not a U.S. GAAP measurement. The Adjusted gross profit measure presented consists of gross profit adjusted for the impairment of upfront fee and the effect of foreign exchange losses from Venezuela. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Significant Issues Affecting Comparability from Period to Period — Venezuela Business.”


		The following table presents a reconciliation of gross profit to Adjusted gross profit:


									Three Months Ended
	Year Ended December 31,								March 31,
	2008		2009			2010			2010			2011
	(In thousands)

Gross profit	$	295,998	$	364,636		$	393,884		$	84,699		$	110,564
Impairment of upfront fee(a)		—		—			11,005			—			—
Effect of foreign exchange loss from Venezuela(b)		—		(85,596	)		(22,209	)		(12,996	)		—

Adjusted gross profit	$	295,998	$	279,040		$	382,680		$	71,703		$	110,564


		Adjusted earnings before interest, taxes, depreciation and amortization (“EBITDA”) is not a U.S. GAAP measurement. The Adjusted EBITDA measure presented consists of net income before provision for income taxes, interest income and expense, depreciation and amortization, impairment of upfront fee, public offering expenses, share-based compensation expense, loss (income) from discontinued operations, net of taxes, other (income) expenses, net, foreign exchange losses (gains), net and acquisition costs .


		The following table presents a reconciliation of net income to Adjusted EBITDA:


										Three Months Ended
	Year Ended December 31,									March 31,
	2008			2009			2010			2010			2011
	(In thousands)

Net income	$	12,772		$	58,336		$	39,765		$	(4,109	)	$	18,638
Provision for income taxes		35,402			46,999			36,938			3,337			10,755
Interest income		(14,206	)		(21,278	)		(7,139	)		(1,826	)		(1,460	)
Interest expense		34,746			17,102			29,025			5,798			13,858
Depreciation and amortization		9,917			13,457			11,913			2,611			3,389

EBITDA		78,631			114,616			110,502			5,811			45,180
Impairment of upfront fee(a)		—			—			11,005			—			—
Public offering expenses(c)		—			—			7,333			5,400			—
Share-based compensation expense(d)		(728	)		625			2,536			174			1,481
Loss (income) from discontinued operations, net of taxes(e)		14,304			(2,595	)		921			9			32
Other income (expenses), net(f)		923			3,459			(2,159	)		(8	)		(1,805	)
Foreign exchange losses (gains), net(g)		25,117			(4,681	)		11,054			4,241			2,486
Acquisition costs(h)		—			—			—			—			1,082

Adjusted EBITDA	$	118,247		$	111,424		$	141,192		$	15,627		$	48,456


		Adjusted net income is not a U.S. GAAP measurement. The Adjusted net income measure presented consists of net income adjusted for the impairment of upfront fee, public offering expenses, share-based compensation expense, acquisition costs, income tax consequences of the foregoing adjustments and impact of the devaluation of the Venezuelan currency.


		The following table presents a reconciliation of net income to Adjusted net income:


										Three Months Ended
	Year Ended December 31,									March 31,
	2008			2009			2010			2010			2011
	(In thousands)

Net income	$	12,772		$	58,336		$	39,765		$	(4,109	)	$	18,638
Impairment of upfront fee(a)		—			—			11,005			—			—
Public offering expenses(c)		—			—			7,333			5,400			—
Share-based compensation expense(d)		(728	)		625			2,536			174			1,481
Acquisition costs(h)		—			—			—			—			1,082
Income tax benefit (expense) of net income adjustments of the line items above at statutory federal rate of 35%		255			(219	)		(7,306	)		(1,951	)		(897	)
Venezuela devaluation(i)		—			—			7,228			7,228			—

Adjusted net income	$	12,299		$	58,742		$	60,561		$	6,742		$	20,304


(a)		In 2010, revenue was affected by an $11.0 million impairment charge. See Note 14 to our consolidated financial statements included elsewhere in this prospectus.


(b)		Represents losses from foreign exchange associated with parallel market transactions in Venezuela. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Significant Issues Affecting Comparability from Period to Period — Venezuela Business.”


(c)		During 2010, we incurred certain expenses in preparation for our initial public offering.


(d)		Share-based compensation expense is composed of the fair value of each of our incentive awards under our stock option plans. See Note 15 to our consolidated financial statements included elsewhere in this prospectus.


(e)		Represents the results of our discontinued operations for the periods presented. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Metrics.”


(f)		Includes non-cash charges related to impairment of certain investments, a loss on sale of subsidiary and a loss on sale of property and equipment. Further, other (income) expenses, net includes earnings and losses attributable to our 50% ownership interest in Brightstar Europe, which we recognize using the equity method of accounting. In 2008, we recognized $4.7 million in losses from Brightstar Europe, including a $2.1 million other than temporary impairment. In 2009 and 2010, we recognized $1.8 million and $2.4 million, respectively, of income from Brightstar Europe. Since 2010, other (income) expenses, net has included rental income and depreciation related to investment properties acquired in Venezuela during 2009 and 2010. See Note 13 to our consolidated financial statements included elsewhere in this prospectus.


(g)		Represents gain and loss from foreign exchange, but excludes foreign exchange losses associated with parallel market transactions in Venezuela. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Significant Issues Affecting Comparability from Period to Period — Venezuela Business.”


(h)		Represents legal and due diligence costs in connection with our M&A activities.


(i)		Represents the net income effect in 2010 related to currency devaluation in Venezuela. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Significant Issues Affecting Comparability from Period to Period — Venezuela Business.”


		We believe Adjusted gross profit, Adjusted EBITDA and Adjusted net income are useful in evaluating our operating performance compared to that of other companies because the calculation adjusts for items which we believe are not indicative of operating performance. We use these measures to evaluate the operating performance of our business and aid in period-to-period comparability. We also use these measures for planning and forecasting, measuring results against our forecast, and in certain cases, for bonus targets for certain employees. Using several measures to evaluate the business allows us and investors to assess our performance and ultimately monitor our ability to generate returns for our stockholders.

		We believe Adjusted gross profit, Adjusted EBITDA and Adjusted net income are also useful to investors because they are frequently used by securities analysts, investors and other interested parties in the evaluation of companies. Our Adjusted gross profit, Adjusted EBITDA and Adjusted net income may not provide information that is directly comparable to that provided by other companies, as other companies may calculate these measures differently.

		Adjusted gross profit, Adjusted EBITDA and Adjusted net income are not measures of financial performance under GAAP and should not be considered as an alternative to gross profit, operating income (loss) or net income (loss) or as an indication of operating performance derived in accordance with GAAP. Adjusted gross profit, Adjusted EBITDA and Adjusted net income have limitations as analytical tools. These measures can exclude a number of items, some of which are cash expenditures and some of which may be recurring. Some of the limitations of these measurements are:

		• Adjusted gross profit, Adjusted EBITDA and Adjusted net income do not reflect the non-cash upfront fee impairment in 2010;

		• Adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;


		• Adjusted EBITDA does not reflect significant interest expense or the cash requirements necessary to service interest or principal payments on our debts;


		• Adjusted EBITDA does not reflect the costs associated with acquisitions; and


		• Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjusted EBITDA does not reflect any cash requirements for such replacements.

		Because of these limitations, Adjusted gross profit, Adjusted EBITDA and Adjusted net income should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and using Adjusted gross profit, Adjusted EBITDA and Adjusted net income supplementally.


(4)		“Pro forma” reflects (i) the conversion of shares of our common stock into shares of Class A common stock and shares of Class B common stock and (ii) the conversion of our redeemable convertible preferred stock into shares of Class A common stock upon the consummation of this offering. See “Use of Proceeds” and “Capitalization.”


(5)		“Pro Forma As Adjusted” reflects the adjustments described above in footnote (4) and further reflects the issuance and sale of shares of Class A common stock by us in this offering at an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover page of this prospectus, and the application of the net proceeds of the offering, after deducting estimated underwriting discounts and offering expenses payable by us, as set forth under “Use of Proceeds.”

(6)		Total debt is defined as lines of credit, trade financing facilities and the current portion of term debt, long-term debt and convertible senior subordinated notes.

RISK FACTORS

Investing in our Class A common stock involves a high degree of risk. You should carefully consider the following risks and all of the other information set forth in this prospectus before deciding to invest in shares of our Class A common stock. If any of the following risks actually occurs, our business, financial condition or results of operations would likely suffer. In such case, the trading price of our Class A common stock could decline, and you may lose all or part of your investment.

Risks Related to Our Business

We depend on a limited number of manufacturer customers to provide us with competitive products at reasonable prices and of good quality.

As part of our value-added distribution services, we purchase wireless devices and accessories from a limited number of manufacturers who are suppliers to us. During the year ended December 31, 2010, our aggregate sales under numerous individual agreements with RIM, Samsung and Motorola’s products accounted for 38%, 19% and 12% of our revenue, respectively. Our top five manufacturer customers are LG, Motorola, Nokia, RIM and Samsung, which together represented 82% of our revenue in 2010. We depend on our manufacturer customers to provide us with adequate inventories of popular brand name products on a timely basis and on favorable pricing and other terms.

Our agreements with our manufacturer customers are generally non-exclusive, 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 manufacturer customers may not offer us competitive products on favorable terms. From time to time we have been unable to obtain sufficient product supplies from manufacturers and operators in many markets in which we operate. Any future failure or delay by our manufacturer customers 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 manufacturers, if these manufacturers consolidate, if these manufacturers are unable to fulfill our product needs or if any principal supplier imposes substantial price increases and alternative sources of supply are not readily available, our business would be materially adversely affected.

Even if our manufacturer customers provide us with wireless devices on a timely basis, our manufacturer customers may not produce the most popular products. For example, certain of our manufacturer customers have suffered significant market share losses in the past several years due to the popularity of other manufacturers’ products. To the extent we do not have access to the most popular products, our business would be adversely affected.

In addition, manufacturers typically provide limited warranties directly to the end consumer or to us. If a line of products we distribute for a manufacturer has quality or performance problems, our ability to provide products to our customers could be disrupted, causing a delay or reduction in our revenue.

We may experience a loss of or reduction in orders from principal customers or a reduction in the prices we are able to charge these customers.

As part of our value-added distribution services, our customers that purchase our services include retailers and operators. For example, in the United States, a large portion of our value-added distribution services is for devices that are used on the Verizon Wireless network. If an operator such as Verizon Wireless decided not to permit us to distribute devices for use on its network, our business would be materially adversely affected. The loss of any of our principal customers, a reduction in the amount of product or services our principal customers order from us or our inability to maintain current terms, including prices, with these or other customers, could harm our results of operations and cash flows. During the year ended December 31, 2010, sales to our top three customers accounted for 38% of our consolidated revenue, of which a group of companies affiliated with America Movil in the

aggregate accounted for 23% of our consolidated revenue. No other customers represented more than 10% of our revenue.

Although we have entered into contracts with certain of our largest customers, we previously have experienced losses of business with certain of these customers through expiration or cancellation of our contracts with them. For example, between 2008 and 2009, we lost value-added distribution business with an operator in Latin America that represented $340.3 million of annual sales. There can be no assurance that any of our customers will continue to purchase products or services from us or that their purchases will be at the same or greater levels than in prior periods. Many of our customers in the markets we serve have experienced severe price competition and, for this and other reasons, may seek to obtain products or services from us at lower prices than we have historically charged.

Our business depends on the continued tendency of manufacturers, operators, retailers and enterprises to outsource aspects of their business to us in the future.

We provide certain outsourced functions such as inventory management, fulfillment, customized packaging, prepaid and e-commerce solutions, activation management, assembly, distribution and other services for many manufacturers, operators, retailers and enterprises. Certain participants in the wireless ecosystem have elected, and others may elect, to undertake these services internally. Additionally, our customer service levels, industry consolidation, competition, deregulation, technological changes or other developments could reduce the degree to which members of the global wireless device industry rely on outsourced services such as the services that we provide. Any significant change in the market for our outsourced services could harm our business. Although our outsourced services are generally provided under multi-year renewable contractual arrangements, these contracts can be terminated for a variety of reasons or expire without renewal. See “Business — Suppliers and Customers”. Although we will actively pursue the renegotiation, extension or replacement of our contracts, there can be no assurance that we will be able to extend or replace our contracts when they may be terminated or may expire without renewal or that the terms of any renegotiated contracts will be as favorable as our existing contracts. If we are unable to renew, extend or replace these contracts, or if we renew them on less favorable terms, our business could be adversely impacted.

Our business could be harmed by fluctuations in regional demand patterns and economic factors.

The demand for our products and services has fluctuated and may continue to vary substantially within the regions served by us. Economic slowdowns in regions served by us or changes in consumer demand could result in lower than anticipated demand for the products and services that we offer and lead to higher levels of inventory in our distribution channels and could decrease our profitability. In addition, consumer demand could fluctuate as a result of changes in foreign currency rates against the U.S. dollar. A prolonged economic slowdown in any region in which we have significant operations could negatively impact our business. For example, in 2009, demand for wireless devices decreased, which negatively impacted our revenue.

An economic downturn could negatively impact our business.

Our business was negatively impacted by the global economic downturn that began in late 2007, and would be harmed by any future global or regional economic downturn. An economic downturn generally has negative implications on our business, which may exacerbate many of the risks associated with our business, including, but not limited to, the following:

Liquidity. Economic downturns and credit crises could reduce access to capital and liquidity and this could have a negative impact on financial institutions and the financial system, which would, in turn, have a negative impact on us and our creditors. Reduced liquidity could cause credit insurers to decrease coverage on our customers and increase premiums, deductibles and co-insurance levels on our remaining or prospective coverage. Our manufacturer customers could tighten trade credit (in

certain cases, as a result of our inability to obtain credit insurance), which could negatively impact our liquidity. We may not be able to borrow additional funds under our existing credit agreements if lenders become insolvent or their liquidity is limited or impaired.

Prices and Demand. Economic downturns may reduce demand for wireless devices and would negatively impact the demand for our services. The recent economic downturn resulted in severe job losses and lower consumer confidence, and as a result, in 2009, worldwide wireless handset unit shipments declined by 1%. In addition, certain markets could experience deflation, which negatively impacts our average selling price and revenue and can lead to inventory obsolescence.

Counterparty Risk. In an economic downturn, our manufacturers, customers and their suppliers (e.g., component manufacturers) may become insolvent, file for bankruptcy or go out of business, which could negatively impact our business. A perception of counterparty risk may also negatively impact our ability to secure contracts with existing and new customers.

We experienced these negative effects on the demand for our services and on our revenue during 2008 and particularly in 2009. These negative effects or the negative effects of any future economic downturn may adversely affect our business.

We may have difficulty collecting our accounts receivable.

We currently offer and will continue to offer open account terms to certain of our customers, which may subject us to credit risks, particularly in the event that any receivables represent sales to a limited number of customers or are concentrated in particular geographic markets. The collection of our accounts receivable and our ability to accelerate our collection cycle through the sale of accounts receivable is affected by several factors, including, but not limited to:


	•	our credit granting policies;

	•	contractual provisions;

	•	geographic exposure;

	•	our customers’ and our overall credit rating as determined by various credit rating agencies;

	•	industry and economic conditions;

	•	the ability of our customers to provide security, collateral or guarantees relative to credit granted by us;

	•	our customers’ recent operating results, financial position and cash flows; and

	•	in certain cases, our ability to obtain credit insurance on amounts that we are owed.

Adverse changes in any of these factors, certain of which are not within our control, could create delays in collecting or an inability to collect our accounts receivable, which in turn could impair our cash flows and our financial position and cause a reduction in our results of operations.

We rely on our manufacturer customers to provide trade credit terms to adequately fund our ongoing operations and product purchases.

Our business is dependent on our ability to obtain adequate supplies of popular products on favorable terms, including payment terms. Our ability to fund our product purchases is dependent on our principal manufacturer customers providing favorable payment terms that allow us to maximize the efficiency of our use of capital. The payment terms we receive from our suppliers are dependent on several factors, including, but not limited to:


	•	our payment history with the manufacturer;

	•	the manufacturer’s credit granting policies and contractual provisions;


	•	our overall credit rating as determined by various credit rating agencies;

	•	industry and economic conditions;

	•	our recent operating results, financial position and cash flows; and

	•	the manufacturer’s ability to obtain credit insurance on certain amounts that we owe them.

Adverse changes in any of these factors, some of which are not within our control, could harm our operations and limit our growth.

We operate a global business that exposes us to risks associated with international activities.

We maintain significant operations centers and sales offices in territories and countries outside of the United States. As of December 31, 2009 and 2010, 81% and 66%, respectively, of our accounts receivable were from non-U.S. customers. In particular, as of December 31, 2009 and 2010, 73% and 57%, respectively, of our accounts receivable were from Latin America. The fact that our business operations are conducted in many countries exposes us to several additional risks, including, but not limited to:


	•	difficulty converting currency and delays in repatriating profits and investments;

	•	potentially significant increases in wireless device prices;

	•	increased credit risks, customs duties, import quotas and other trade restrictions;

	•	potentially greater inflationary pressures;

	•	shipping delays;

	•	devaluation of foreign currencies;

	•	possible nationalization of our customers in certain markets; and

	•	possible wireless device supply interruption.

As a result, our operating results and financial condition could be significantly affected by these risks and other risks associated with international activities, including environmental and trade protection laws, policies and measures; tariffs; export license requirements; enforcement of the Foreign Corrupt Practices Act (“FCPA”) or similar laws of other jurisdictions on our business activities outside the United States; other regulatory requirements; economic and labor conditions; political or social unrest; economic instability or natural disasters in a specific country or region, such as hurricanes, earthquakes and tsunamis; health or similar issues; tax laws in various jurisdictions around the world; and difficulties in staffing and managing international operations. In particular, our results could be materially impacted by changes in tax laws and other regulations in Argentina. Our revenue in Latin America grew significantly in the quarter ended March 31, 2011, primarily due to increased production in our assembly facility in Tierra del Fuego, Argentina as a result of laws designed to encourage local production. In addition, we are in and may in the future enter into certain developing markets where the legal systems and infrastructures are not fully developed. We have in the past entered into certain local markets at significant cost only to subsequently withdraw from such markets because our performance did not achieve the level that we had anticipated. In the past, as a result of ineffective internal controls, some of our subsidiaries made disbursements to vendors that lacked adequate documentation. While we are not aware of any Foreign Corrupt Practices Act or similar violations, we cannot be certain that we have not or will not violate such laws.

Although we generally negotiate our agreements with customers in U.S. dollars, local legal restrictions may necessitate that our agreements be denominated in foreign currencies. Where so required, we are exposed to market risk primarily related to foreign currencies and interest rates. In particular, we are exposed to changes, over which we have no control, in the value of the U.S. dollar versus the local currency in which the products are sold and goods and services are purchased,

including devaluation and revaluation of local currencies. We manage our exposure to fluctuations in the value of currencies and interest rates using a variety of financial instruments. Although we believe that our exposures are appropriately diversified across counterparties and that these counterparties are creditworthy financial institutions and although we monitor the creditworthiness of our counterparties, we are exposed to credit loss in the event of non-performance by our counterparties in relation to foreign exchange contracts and we may not be able to adequately mitigate all foreign currency related risks. In addition, we may not execute our hedging strategy successfully which may lead to future foreign exchange losses.

We conduct a substantial amount of business in Venezuela.

In the years ended December 31, 2008, 2009 and 2010, we generated $654.8 million, $527.6 million and $486.6 million of our sales to customers in Venezuela, respectively. In addition, as of December 31, 2009 and December 31, 2010, we had accounts receivable relating to customers in Venezuela totaling $254.9 million and $129.4 million, respectively. In recent years Venezuela has experienced political challenges, difficult economic conditions, relatively high levels of inflation and foreign exchange and price controls. The president of Venezuela has the authority to legislate certain areas by decree, and the government has nationalized or announced plans to nationalize certain industries and to expropriate certain companies and property. These factors, however, none of which are within our control, could affect our ability to conduct business in Venezuela, collect our receivables or repatriate funds and may have a negative impact on our business.

In 2003, Venezuela imposed currency controls and created the Commission of Administration of Foreign Currency (“CADIVI”) with the task of establishing detailed rules and regulations and generally administering the exchange control regime. These controls fix the exchange rate between the Bolivar and the U.S. dollar and restrict the exchange of Bolivars for U.S. dollars and vice versa. As a result, our customers in Venezuela were required to obtain CADIVI approval prior to the acquisition and importation of the goods that we help distribute for them and CADIVI authorization for the release of U.S. dollars for payment to us. Foreign currency payments for our invoices paid through the CADIVI process are typically received between 90 to 240 days from the invoice date; however, in some cases, we have experienced delays extending beyond 365 days. CADIVI has recently pronounced that certain commodities will have priority to foreign currencies, which resulted in temporary delays to our customers in obtaining CADIVI approval as the CADIVI announcement was unclear. CADIVI clarified that the telecommunications industry would have priority, which relieved the delays. Any delays in receiving CADIVI approval and payment from our Venezuela customers could have an adverse effect on our business.

As of July 1, 2009, we determined that Venezuela’s economy met the definition of highly inflationary and changed the functional currency of our Venezuelan subsidiary to our reporting currency (U.S. dollars). As a consequence of this change in functional currency, the effect of all Venezuelan currency fluctuations are classified as foreign exchange gains and losses and included in the determination of earnings, beginning July 1, 2009. On January 8, 2010, the Venezuelan government announced its intention to devalue its currency and move to a two-tier exchange structure, effective January 11, 2010: a 2.30 BsF rate to the USD for transactions deemed priorities by the government and a 4.60 BsF rate to the USD for other transactions. The latter rate is applicable to our operations in Venezuela. In May 2010, the Venezuelan government enacted reforms to its exchange regulations to close the parallel market. In early June 2010, the Venezuelan government introduced additional regulations under a newly regulated system (the Sistema de Transacciones con Titulos en Moneda Extranjera, or “SITME”), which is controlled by the Central Bank of Venezuela (“BCV”). The SITME imposes volume restrictions on an entity’s trading activity. Foreign exchange transactions occurring after SITME began in June 2010 and which are not conducted through CADIVI or SITME may not comply with the amended exchange regulations. As a result, we curtailed our parallel market activity in the first half of 2010 and no longer conduct transactions through a parallel market in Venezuela. In December 2010, the Venezuelan government announced a currency devaluation,

effective January 2011, wherein the Bolivar would have one set government rate. For the years ended December 31, 2009 and 2010, we incurred a foreign exchange loss of $85.6 million and $22.2 million, respectively, due to foreign currency transactions we executed in the parallel market in Venezuela, primarily in the second and third quarters of 2009. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Significant Issues Affecting Comparability from Period to Period — Venezuela Business.”

Our operating results vary frequently and significantly in response to seasonal purchasing pattern fluctuations.

Our operating results may be influenced by a number of seasonal factors in the different countries and markets in which we operate. These factors may cause our revenue and operating results to fluctuate on a quarterly basis. These fluctuations are a result of several factors, including, but not limited to:


	•	promotions and subsidies by operators;

	•	rebates or price reductions offered by manufacturer customers;

	•	the timing of local holidays and other events affecting consumer demand;

	•	the timing of the introduction of new products and services by our manufacturer customers and their competitors;

	•	purchasing patterns of consumers in different markets;

	•	general and regional, economic, monetary and political conditions;

	•	product availability and pricing; and

	•	increases in net working capital and resulting funding requirements.

Consumer electronics and retail sales in many geographic markets tend to experience increased volumes of sales at the end of the calendar year, largely because of gift-giving holidays. This and other seasonal factors have contributed to increases in our sales during the fourth quarter in certain markets. Conversely, we have experienced decreases in demand in the first quarter subsequent to the higher level of activity in the preceding fourth quarter. Our operating results may continue to fluctuate significantly in the future. If unanticipated events occur, including delays in securing adequate inventories of competitive products at times of peak demand or significant decreases in sales during these periods, our business could be harmed. In addition, as a result of seasonal factors, interim results may not be indicative of annual results.

Our business could be harmed by consolidation of operators.

The past several years have witnessed a consolidation within the operator community, and this trend is expected to continue. This trend could result in a reduction or elimination of promotional activities by the remaining operators as they seek to reduce their expenditures, which could, in turn, result in decreased demand for our products or services. Moreover, consolidation of operators reduces the number of potential contracts available to us and other providers of supply chain, retail and enterprise services. We could also lose business if operators that are our customers are acquired by other operators that are not our customers.

We are dependent on a variety of information systems to process transactions, summarize results and manage our business.

Given the large number of individual transactions we conduct each year, it is critical that we maintain uninterrupted operation of our business critical information systems. Disruptions in both our primary and secondary (back-up) systems could harm our ability to run our business. Although we

have independent and physically separate primary and secondary data centers, we cannot be certain that our information systems will not experience a significant interruption or failure.

We depend on a variety of information systems for our operations, which support many of our operational functions such as inventory management, order processing, shipping, receiving and accounting. Our information systems, including our back-up systems, are subject to damage or interruption from power outages, computer and telecommunications failures, computer viruses, security breaches, catastrophic events such as fires, tornadoes, hurricanes, earthquakes and tsunamis, and usage errors by our employees. If our primary and back-up systems are damaged or cease to function properly, we may have to make a significant investment to fix or replace them, and we may suffer interruptions in our operations in the interim. We have not recently experienced material system-wide failures or downtime for any of our information systems used around the world; however, we cannot assure that such failures will not occur in the future. Any material interruption in either or both of our primary or back-up systems may have a material adverse effect on our business. Failures or significant downtime for any of our information systems could prevent us from placing product orders with vendors or recording inventory received, taking customer orders, printing product pick-lists, or shipping and invoicing for products sold, or recording transactions. It could also prevent customers from accessing our product information.

In order to support our future growth, we continue to review our business needs and are making continuous improvements, including standardization, where appropriate, of establishing common business processes and controls across our lines of business, and technology upgrades to our information systems, including software applications and electronic interfaces with our business partners. This can be a lengthy and expensive process that may result in a significant diversion of resources from other operations. The risk of system disruption is increased when significant system changes are undertaken. In implementing these enhancements, we may experience greater-than-expected difficulty or costs; and we may also experience significant disruptions in our business, which could have a material adverse effect on our business, particularly if we were to replace a substantial portion of our current information systems and processes. In addition, competitors may develop superior information systems or we may not be able to meet evolving market requirements by upgrading our current information systems at a reasonable cost, or at all.

Finally, we also rely on the Internet for a significant percentage of our orders and information exchanges with our customers. The Internet and individual websites in general have experienced a number of disruptions and slowdowns, some of which were caused by organized attacks. In addition, some websites associated with other companies have experienced security breakdowns or breaches of confidential information. Although our website has not experienced any material breakdowns, disruptions or breaches in security, we cannot be assured that this will not occur in the future. If we were to experience a security breakdown, disruption or breach that compromised sensitive information, our relationship with our customers could be adversely affected. Disruption of our website or of the Internet in general could impair our order processing or more generally prevent our customers from accessing critical information. This disruption could cause us to lose business.

Our future operating results will depend on our ability to continue to increase volumes and maintain margins as well as on the relative mix of our services provided.

Over 90% of our revenue during the three months ended March 31, 2011 and in 2010 was derived from sales of wireless devices, a part of our value-added distribution services that operates on a high-volume, low-margin basis. Our ability to generate these sales is based upon continued demand for wireless devices and our having an adequate supply of these devices. The gross margins that we realize on sales of wireless devices could be reduced over time due to increased competition, which in turn would lead to a decline in our overall margins. This margin pressure may, however, be offset to some extent if we are able to continue to increase the relative contribution of our higher margin, fee-based supply chain, retail and enterprise services to our overall business, a shift in product and services mix which would have a positive impact on our margins. However, an increased contribution of supply chain, retail and enterprise services relative to our value-added distribution services may lower the pace

of revenue growth while having a positive impact on our gross margins. Our future growth and margin profile will depend on, among other things, our mix of value-added distribution and other services.

The natural lifecycle of certain of our supply chain, retail and enterprise services arrangements where we are paid a percentage of the savings we achieve for our customers, especially in the case of strategic sourcing, will decline over time as savings are fully realized, unless replaced by new contracts for additional services. If we are unable to enter into new supply chain, retail and enterprise services contracts, our revenue and gross margin may decline and our operating results could be adversely affected.

Our business growth strategy includes strategic partnerships, investments and acquisitions.

As part of our business strategy, we intend to pursue selected strategic partnerships, investments and acquisitions in complementary businesses. Our strategic partnership, investment and acquisition strategy involves a number of risks, including:


	•	difficulty in identifying attractive strategic partnership, investment or acquisition opportunities;

	•	difficulty in successfully integrating acquired operations, information technology systems, customers, manufacturer relationships, products and businesses with our operations;

	•	loss of key employees of acquired operations or inability to hire key employees necessary for our expansion;

	•	diversion of our capital and management attention away from other business issues;

	•	entering new markets or offering new products we are not familiar with and competing with incumbents that have greater expertise (such as our recent acquisition of eSecuritel through which we plan to commence offering wireless handset insurance, an area that is new to us);

	•	increase in our expenses and working capital requirements;

	•	in the case of acquisitions that we may make outside of the United States, difficulty in operating in foreign countries and over significant geographical distances; and

	•	other financial risks, such as potential liabilities of the businesses we acquire.

Our growth may be limited and our competitive position may be harmed if we are unable to identify, finance, consummate and integrate future acquisitions and investments. Future acquisitions and investments may result in dilutive issuances of equity securities, the incurrence of additional debt or large write-offs. The incurrence of debt in connection with any future acquisitions and investments could restrict our ability to obtain working capital or other financing necessary to operate our business. Our future acquisitions and investments may not be successful, and if we fail to realize the anticipated benefits of these acquisitions and investments, we may experience a decrease in future profitability or increase in future losses and our business could be adversely affected.

Our future operating results may suffer if we do not effectively manage our product inventories or are required to write down our inventories due to rapid technological changes in the global wireless device industry or changing market demands.

The technology relating to wireless devices changes rapidly, resulting in product obsolescence or short product lifecycles. As a result, we need to manage our inventory effectively to meet changing consumer demand and retailer volume requirements. Some of the products we distribute have in the past and may in the future become obsolete while in our inventory due to changing consumer demands or slowdowns in demand for existing products ahead of new product rollouts by our manufacturer customers or their competitors. If we are not able to manage our inventory effectively, we may need to write off unsaleable or obsolete inventory, which would adversely affect our business.

Our success depends on accurately anticipating future technological changes in our industry and on continually identifying, obtaining and marketing new products in order to satisfy evolving industry and customer requirements. Competitors or manufacturers of wireless devices may market products that have perceived or actual advantages over the products that we handle or render those products obsolete or less marketable. We have made and continue to make significant working capital investments in accordance with evolving industry and customer requirements, including maintaining levels of inventories of currently popular products that we believe are necessary based on current market conditions. These concentrations of working capital increase our risk of loss due to product obsolescence.

The global wireless device industry is intensely competitive, and we may not be able to continue to compete successfully in this industry.

For our value-added distribution services, we compete for sales of wireless devices, and expect that we will continue to compete, with numerous well-established manufacturers, including our own manufacturer customers. Furthermore, certain manufacturers may choose to develop the capabilities to go direct to customers and also implement extensive advertising and promotional programs, minimizing the need for distributors. We also compete with other distributors. The global wireless device industry has generally had low barriers to entry for companies with sufficient capital. As a result, 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. Our ability to continue to compete successfully will depend largely on our ability to maintain our current and enter into new customer relationships, continuing to innovate our service portfolio and establishing business relationships with new entrants. We may not be successful in anticipating and responding to competitive factors affecting our industry, including 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 wireless communications industry matures 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 collaborate with manufacturers, operators, retailers and enterprises to optimize their supply chains and, therefore, rely on our customers to outsource or agree to collaborate with us for parts of, or the entirety of, their supply chains. As such, we compete with various parties, including our customers who may choose to in-source, other supply chain solutions companies, software companies, business process outsourcers, management and information technology consultants and electronic manufacturing services companies. Many of our competitors possess greater financial and other resources than we do and may market similar products or services directly to our customers. Furthermore, we may not be successful in anticipating and responding to competitive factors affecting our industry, including new or changing outsourcing requirements or the introduction of new technologies and services that can change the competitive landscape.

We may have higher than anticipated tax liabilities.

We conduct business globally and file income tax returns in multiple jurisdictions. Our effective tax rate could be adversely affected by several factors, including:


	•	changes in income before taxes in various jurisdictions in which we operate that have differing statutory tax rates;

	•	changing tax laws, regulations and interpretations of such tax laws in multiple jurisdictions; and

	•	the resolution of issues arising from tax audits or examinations (including our ongoing U.S. federal income tax audit) and any related interest or penalties.

We report our results of operations based on our determination of the amount of taxes owed in the various jurisdictions in which we operate. The determination of our worldwide provision for income taxes and other tax liabilities requires estimation, judgment and calculations where the ultimate tax determination may not be certain. Our determination of tax liability is always subject to review or examination by authorities in various jurisdictions. Any adverse outcome of such a review or examination and any proposed adjustments resulting therefrom could have a negative impact on our business. The results from tax examinations and audits (including our ongoing U.S. federal income tax audit) may differ from the liabilities recorded in our financial statements and may adversely affect our business.

The Internal Revenue Service (the “IRS”) and other taxing authorities regularly examine our income tax returns. In connection with these examinations, we have received notices from various taxing authorities alleging that we are liable for underpayment of tax of $17.9 million, inclusive of penalties and interest. We believe certain of the adjustments proposed by the IRS are inconsistent with applicable tax laws, and we intend to challenge the adjustments vigorously. We expect to prevail in administrative or court proceedings and that any resulting tax liabilities will not exceed amounts accrued for income taxes in our financial statements. However, the final outcome regarding these proceedings cannot be estimated with certainty, and we cannot guarantee that the outcome will not have a material effect on our operations.

We have provided indemnities to Motorola Mobility and we may have increased liabilities as a result of these indemnities.

In connection with our operations in Tierra del Fuego, Argentina, we entered into an agreement in July 2008 to indemnify Motorola Mobility for up to $10.0 million for reimbursement payments it may be obligated to make to a common customer arising from the customer’s non-compliance with the applicable Argentinean tax regime. We evaluate this indemnification in accordance with ASC 460 Guarantees, which requires immediate recognition of a liability for obligations under guarantees that impose an ongoing obligation to stand ready to perform, even if it is not probable that the specified triggering events or conditions will occur. As a consequence of entering into this indemnity, we recorded a liability of $2.0 million. A tax assessment for 2005 was filed against the common customer, and we are assisting Motorola Mobility’s defense of the case in the Argentina Tax Court. In addition, we have provided additional indemnities to Motorola Mobility under our distribution and financing agreements with Motorola Mobility for damages caused by handset assembly defects, failure to timely deliver products, failure to comply with FCPA or similar laws and other similar performance issues. All of our obligations to Motorola Mobility are secured by a second lien on assets securing our credit agreement.

We may not be able to grow at our historical rate or effectively manage future growth.

We have experienced significant growth, both domestically and internationally; however, we may not be able to continue to grow at a similar rate in the future because our international operations present significant management and organizational challenges to future growth. We will need to execute our strategy successfully, manage our expanding operations efficiently and effectively integrate into our operations any new businesses which we may acquire in order to continue our desired growth. If we are unable to do so, particularly for operations or transactions in which we have made significant capital investments, it could materially harm our business. Our inability to absorb the increasing operating costs that we have incurred, and expect to continue to incur, in anticipation of the growth we hope to achieve could cause our future earnings to decline if we are not able to generate the growth we expect to balance the increased operating costs. In addition, our growth prospects could be harmed by circumstances outside our control such as a decline in the demand for wireless devices globally or in one of the regions we serve, either of which could result in reduction or deferral of expenditures by existing or prospective customers.

In addition, growth of our operations will place a significant strain on our management, administrative and operational infrastructure, and we may not be able to hire and train additional personnel to manage such growth effectively. Furthermore, it takes time for our newer employees to develop the knowledge, skills and managerial and operational experience that our business model requires. If we fail to successfully manage our growth, we may be unable to successfully execute our business plan.

We are highly dependent on our Chairman and Chief Executive Officer and management team and the loss of our executive officers and key personnel could impede our ability to implement our strategy.

Our success depends in large part on the abilities and continued service of our executive officers and other key employees. In particular, we are highly dependent on the continued service of our co-founder, Chairman and Chief Executive Officer, who has developed extensive relationships with certain manufacturers, operators and retailers throughout the world. If for any reason our Chairman and Chief Executive Officer was no longer working for us, his knowledge and relationships would be very difficult to replace. We do not maintain “key man” life insurance for our Chairman and Chief Executive Officer.

The loss of any of our executive officers or other key personnel could impede our ability to fully and timely implement our business plan and future growth strategy. Although we have employment agreements with certain of our executive officers and non-competition agreements with our executive officers and certain key employees, our executive officers and key employees can always terminate their employment with us and our non-competition agreements are of limited scope and duration and are not easily enforced.

In order to support our continued growth, we need to effectively recruit, train and retain additional qualified employees, including sales personnel. Competition for qualified personnel is intense, and there can be no assurance that we will be able to successfully attract, train or retain sufficiently qualified personnel.

If we are unable to manage the organizational challenges associated with our size, we might be unable to achieve our business objectives.

We have operations in 50 countries and approximately 3,600 employees worldwide. Our decentralized international operations present management and organizational challenges, which will only increase as we continue to grow and expand. It is difficult to maintain common standards across a large enterprise and effectively communicate our institutional knowledge. In addition, it can be difficult to maintain our culture, effectively manage our personnel and operations and effectively communicate to our personnel worldwide our core values, strategies and goals. Finally, the size and scope of our operations increase the possibility that an employee will engage in unlawful, unethical or fraudulent activity or otherwise expose us to unacceptable business risks, despite our efforts to properly train and educate our people and maintain appropriate internal controls to prevent such instances. If we do not continue to develop and implement the right processes, tools and ethical behaviors to manage our enterprise, our ability to compete successfully and achieve our business objectives could be impaired.

We could have liability or our reputation could be damaged if we do not protect customer data or information systems or if our information systems are breached.

We are dependent on information technology networks and systems to process, transmit and store electronic information and to communicate among our locations around the world and with our customers. Security breaches of this infrastructure could lead to shutdowns or disruptions of our systems and potential unauthorized disclosure of confidential information. We are required at times to manage, utilize and store sensitive or confidential customer or employee data. We are subject to numerous U.S. and foreign jurisdiction laws and regulations designed to protect this information, such

as the European Union Directive on Data Protection and various U.S. federal and state laws governing the protection of health or other individually identifiable information. If any person, including any of our employees, negligently disregards or intentionally breaches our established controls with respect to such data or otherwise mismanages or misappropriates that data, we could be subject to monetary damages, fines or criminal prosecution. Unauthorized disclosure of sensitive or confidential customer or employee data, whether through systems failure, employee negligence, fraud or misappropriation, could damage our reputation and cause us to lose customers. Similarly, unauthorized access to or through our information systems or those we develop for our customers, whether by our employees or third parties, could result in negative publicity, legal liability and damage to our reputation.

We are dependent on third parties for the delivery of our products and services.

We rely almost entirely on arrangements with third-party shipping and freight-forwarding companies for the delivery of our products and services. The termination of our arrangements with one or more of these third-party shipping companies, or the failure or inability of one or more of these third-party shipping companies to deliver products from our manufacturer customers to us or products from us to our customers, could disrupt our business and harm our reputation and operating results.

We rely to a great extent on our intellectual property 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. With respect to 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 third parties 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 the 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 have identified material weaknesses in our internal controls over financial reporting which, if not successfully remediated, could cause us to fail to timely report our financial results, prevent fraud and avoid material misstatements in our financial statements.

In connection with the preparation of our financial statements for the years ended December 31, 2009 and 2010, we identified several material weaknesses in our internal controls over financial reporting, some of which were not properly remedied from prior years. A deficiency in internal control over financial reporting exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis.

The material weaknesses that existed as of December 31, 2010 were identified in 2009 and were not properly remediated. These material weaknesses included the following:


	•	At one of our foreign subsidiaries, we identified a lack of controls over (i) the review and approval of journal entries, (ii) the approval of and payments to vendors and (iii) the issuance of vendor credits.

	•	At one of our U.S. subsidiaries, we identified (i) a lack of segregation of duties and formal evidence of review and approval of payments to vendors and account reconciliations and (ii) a lack of sufficient and appropriate evidence supporting vendor credits, and, at our corporate headquarters, we identified a lack of approval of contracts.

A remediation process designed to eliminate the identified deficiencies is underway. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Material Weaknesses and Remediation Efforts.” However, we do not expect the remediation plan to be completed until later in 2011. Even though we have initiated and in some instances implemented a number of remedial actions, there can be no assurance that the measures we have taken, or will take, will be on schedule or effective to address the issues identified or that similar weaknesses or deficiencies will not recur in the future. As a result of these and similar activities, management’s attention may be diverted from other business concerns, which could have a material adverse effect on our business.

If the remedial policies, procedures and systems we implement, resources we add or personnel we hire are insufficient to address the identified material weaknesses, or if additional material weaknesses or significant deficiencies in our internal controls are discovered in the future, we may be unable to report our financial results on a timely basis or to prevent fraud, our consolidated financial statements may contain material misstatements or we may not be able to comply with applicable financial reporting requirements and the requirements of our various financing agreements. If any of these events occur, our business and reputation may be significantly harmed and investors may not want to own our securities. Failure to comply with reporting requirements under our various financial agreements could result in defaults thereunder and acceleration of outstanding indebtedness.

We may not have adequate liquidity or capital resources.

We require cash or committed liquidity facilities for general corporate purposes, such as funding ongoing working capital, acquisition and capital expenditure needs. For the twelve months ended December 31, 2010 and the three months ended March 31, 2011, we used cash for operating activities of $159.3 million and $27.7 million, respectively. As of December 31, 2010 and March 31, 2011, we had cash and cash equivalents of $159.2 million and $102.5 million, respectively. In addition, as of December 31, 2010 and March 31, 2011, we have access to credit lines of approximately $850.0 million and $750.0 million, respectively, with a gross availability of approximately $600.0 million and $400.0 million, respectively. In December 2010, we increased our revolving credit facility (the “ABL Revolver”) to a total facility size of $500.0 million, with an option for an additional uncommitted $100.0 million financing. In November 2010, we raised $250.0 million through the sales of senior unsecured notes, and in May 2011, we raised an additional $100.0 million through the sale of such notes (collectively, the “2016 Notes”). In addition, as of December 31, 2010, we had over $1.3 billion in available trade credit provided by our suppliers. Our ability to satisfy our cash needs will depend on our ability to generate cash from operations and to access the financial markets, both of which will be subject to general economic, financial, competitive, legislative, regulatory and other factors beyond our control. We may, in the future, need to access the financial markets to satisfy our cash needs. Our ability to obtain external financing will be affected by general financial market conditions and our future debt ratings. Further, any increase in our level of debt, change in status of our debt from unsecured to secured debt, or deterioration of our operating results may cause a reduction in our future debt ratings. Any downgrade in our debt rating or tightening of credit availability could impair our ability to obtain additional financing or renew existing credit facilities on acceptable terms. Under the terms of

any future external financing, we may incur higher than expected financing expenses. A lack of access to adequate capital resources could have a material adverse effect on our liquidity and our business.

We have a substantial amount of indebtedness which may adversely affect our cash flow and our ability to operate our business and to fulfill our obligations under our indebtedness.

As of March 31, 2011, our total indebtedness was $450.3 million. In addition, in May 2011, we issued $100 million additional 2016 Notes. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources.”

Our substantial indebtedness could have important consequences, including the following:


	•	Increased difficulty for us in satisfying our obligations with respect to our existing 2016 Notes, including any repurchase obligations that may arise thereunder;

	•	Increased vulnerability to economic downturns and adverse developments in our business;

	•	A requirement that a substantial portion of cash flow from operations be allocated to the payment of principal and interest on the 2016 Notes and, to the extent incurred, indebtedness under the ABL Revolver and any other indebtedness, therefore reducing our ability to use our cash flow to fund our operations and capital expenditures and to invest in future business opportunities;

	•	Exposure to the risk of increased interest rates as borrowings under our ABL Revolver carry variable rates of interest;

	•	Restrictions on our ability to take advantage of strategic opportunities or our ability to make non-strategic divestitures;

	•	Limitations on our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, restructuring, acquisitions or general corporate or other purposes, which could be exacerbated by further volatility in the credit markets;

	•	Disadvantages compared to our competitors who have proportionately less debt;

	•	Limited flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; and

	•	Failure to satisfy our obligations under the 2016 Notes or our other indebtedness or failure to comply with the restrictive covenants contained in the indenture that governs the 2016 Notes and the credit agreement that governs our ABL Revolver or our other indebtedness could result in an event of default which could result in all of our indebtedness becoming immediately due and payable and could permit the holders of the notes and our other secured lenders to foreclosure on our assets securing such indebtedness.

Despite our current level of indebtedness, we and our subsidiaries may incur significant additional indebtedness, including secured indebtedness, in the future.

The terms of our debt covenants could limit our flexibility in operating our business and our ability to raise additional funds.

The agreements that govern the terms of our debt, including the indenture that governs the 2016 Notes and the credit agreement that governs our ABL Revolver, contain, and the agreements that govern our future indebtedness may contain, covenants that restrict our ability and the ability of our subsidiaries to:


	•	incur additional debt;

	•	make certain payments, including dividends or other distributions, with respect to our capital stock, or prepayments of subordinated debt;

	•	make certain investments or sell assets;


	•	create certain liens or engage in sale and leaseback transactions;

	•	provide guarantees for certain debt;

	•	enter into restrictions on the payment of dividends and other amounts by subsidiaries;

	•	engage in certain transactions with affiliates;

	•	consolidate, merge or transfer all or substantially all our assets; and

	•	enter into other lines of business.

A breach of the covenants or restrictions under the indenture that governs the 2016 Notes, the credit agreement that governs the ABL Revolver or any agreement that governs any other indebtedness could result in a default under the applicable indebtedness. Such default or any payment default may allow the creditors to accelerate the related debt and may result in the acceleration of any other debt to which a cross-acceleration or cross-default provision applies. In addition, an event of default under our ABL Revolver would permit the lenders under our ABL Revolver to terminate all commitments to extend further credit under that facility. Furthermore, if we were unable to repay the amounts due and payable under our ABL Revolver, those lenders could proceed against the collateral granted to them to secure that indebtedness. In the event our lenders and holders of the 2016 Notes accelerate the repayment of our borrowings, we cannot assure that we and our subsidiaries would have sufficient assets to repay such indebtedness.

In the past, we have obtained waivers from our lenders for non-compliance with certain of the covenants related to our indebtedness. Although no waiver for non-compliance with any covenant related to our indebtedness is currently required, we cannot predict whether we will need future waivers or whether we will be able to obtain them.

These restrictions may restrict our financial flexibility, limit any strategic initiatives, restrict our ability to grow or limit our ability to respond to competitive changes. As a result of these covenants, we will be limited in the manner in which we can conduct our business, and we may be unable to engage in favorable business activities or finance future operations or capital needs. Accordingly, these restrictions may limit our ability to successfully execute our strategy and operate our business. In addition, as a result of a default of any covenant and any actions the lenders may take in response thereto, we could be forced into bankruptcy or liquidation.

Risks Related to This Offering

The voting power of our capital stock will be concentrated in our Chairman and Chief Executive Officer, which will limit your ability to influence corporate matters.

Following the completion of this offering, our Class B common stock will have 5 votes per share except in limited circumstances, and our Class A common stock, which is the stock we are selling in this offering, will have one vote per share. Following the completion of this offering, Mr. Claure will beneficially own 100% of our Class B common stock, representing approximately % of the combined voting power of our outstanding common stock and % of our total equity ownership assuming the underwriters’ option to purchase additional shares is not exercised. Mr. Claure will have the ability to take stockholder action with respect to certain matters without the vote of any other stockholder and without having to call a stockholder meeting, and investors in this offering will not be able to affect the outcome of those stockholder votes during this period. Mr. Claure will continue to control most matters submitted to our stockholders for approval even though he will beneficially own less than 50% of the outstanding shares of our common stock due to the fact that each share of Class B common stock will entitle him to 5 votes, except in limited circumstances. As a result, Mr. Claure may, through our board of directors, influence all matters affecting us, including:


	•	any determination with respect to our business plans and policies (except for fundamental changes to our business);


	•	our financing activities; and

	•	other significant corporate transactions.

This concentration of voting control will limit your ability to influence corporate matters and, as a result, we may take actions that our Class A common stockholders may not view as beneficial. See “Description of Capital Stock — Common Stock” and “Description of Capital Stock — Voting Rights” for a more detailed discussion of the relative rights of the Class A and Class B common stock.

We will be a “controlled company” within the meaning of the Nasdaq Stock Market rules, and, as a result, will rely on exemptions from certain corporate governance requirements that provide protection to stockholders of other companies.

After the completion of this offering, Mr. Claure will beneficially own more than 50% of the combined voting power of our outstanding common stock, and we will be a “controlled company” under the Nasdaq Stock Market corporate governance standards. As a controlled company, certain exemptions under the Nasdaq Stock Market corporate governance standards free us from the obligation to comply with certain Nasdaq Stock Market corporate governance standards, including that a majority of our board of directors consist of independent directors.

As a result of our use of the “controlled company” exemptions, you will not have the same protection afforded to stockholders of companies that are subject to all of the Nasdaq Stock Market corporate governance standards.

Lindsay Goldberg’s interests may conflict with those of other stockholders.

Our stockholders’ agreement provides that Lindsay Goldberg, a New York-based private equity firm, is not prohibited from investing or participating in competing businesses. Lindsay Goldberg is in the business of making investments in companies and may from time to time acquire and hold interests in businesses that compete directly or indirectly with us. Lindsay Goldberg may also pursue acquisition opportunities that are complementary to our business and, as a result, those acquisition opportunities may not be available to us. To the extent they invest in such other businesses, Lindsay Goldberg may have differing interests than our other stockholders.

There has been no public market for our Class A common stock; our stock price could be volatile and could decline following this offering, resulting in a substantial loss on your investment.

Prior to this offering, there has been no public market for our Class A common stock. We cannot predict the extent, if any, to which an active trading market for our Class A common stock will develop or be sustained. The absence of any active trading market could adversely affect your ability to sell shares that you own and could depress the market price of those shares. The initial public offering price will be determined through negotiations among us, the selling stockholders and the representatives of the underwriters and may bear no relationship to the price at which our Class A common stock will trade following the completion of this offering. In general, the stock market has been highly volatile and the market price of our Class A common stock may also be volatile. Investors may incur substantial losses as a result of decreases in the market price of our Class A common stock, including decreases unrelated to our financial condition, operating performance or prospects. The market price of our Class A common stock could fluctuate widely or decline as a result of a number of factors, including those under “— Risks Related to Our Business” and the following:


	•	our short- and long-term operating performance and the operating performance of other companies within the wireless device industry;

	•	changes in our net sales or net income or in estimates of or recommendations by securities analysts;


	•	speculation in the media or investment community;

	•	political, monetary, social and economic events and conditions in our geographic markets, including in particular Latin America;

	•	currency fluctuations and devaluations;

	•	acts of God, hostilities and terrorist acts; and

	•	general financial and economic conditions, including factors not directly related to our performance.

In the past, securities class action litigation has often been instituted against companies following periods of volatility in their stock trading price. Any such litigation against us could involve substantial costs and liability and significantly divert our management’s time, attention and resources regardless of the merits of such litigation.

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline.

The trading market for our Class A common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. We do not currently have and may never obtain research coverage by securities and industry analysts. If no securities or industry analysts commence coverage, the trading price for our Class A common stock could be negatively impacted. If we obtain securities or industry analyst coverage and if one or more of the analysts who covers us downgrades our stock or publishes inaccurate or unfavorable research about our business, our stock price would likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly, demand for our Class A common stock could decrease, which could cause our stock price and trading volume to decline.

Some provisions of our certificate of incorporation and by-laws could delay or prevent transactions that many stockholders may favor.

Some provisions of our certificate of incorporation and by-laws, to be effective upon completion of this offering, could have the effect of delaying or preventing a tender offer or other takeover attempt of our company that many of our stockholders might consider favorable, including attempts that might result in a premium over the prevailing market price of our Class A common stock. These provisions are intended by us to enhance the likelihood of stability in the composition of our board of directors and in the policies of the board and to discourage or delay certain transactions that involve a potential change in control of our company. They are designed also to reduce our vulnerability to an unsolicited acquisition proposal and to discourage some tactics often used in proxy contests. These provisions, however, could have the effect of discouraging others from making tender offers for shares of our Class A common stock. These provisions may also have the effect of preventing or delaying changes in our management. See “Description of Capital Stock” for a more detailed discussion of these provisions.

The change in control provisions of certain of our agreements with our principal manufacturer customers, our amended and restated credit facility and the indenture governing the 2016 Notes could impede or prevent transactions that many of our stockholders might favor.

Certain of our agreements with Motorola and our distribution agreement with Samsung contain provisions that allow for the immediate termination of such agreements in the event of a change of control of our company (other than in connection with this offering). Additionally, under the terms of our amended and restated credit facility with PNC Bank (and other lenders), a change in control of our company (other than in connection with this offering) would constitute an event of default and our obligations under such amended and restated credit facility could be accelerated and under our indenture governing the 2016 Notes, upon a change of control, holders of the notes have the right to

require us to repurchase the notes. Such provisions could have the effect of delaying or preventing a tender offer or other takeover attempt of our company that many of our stockholders might consider favorable, including offers or attempts that might result in a premium over the prevailing market price of our Class A common stock. They may also have the effect of preventing or delaying changes in our management.

Our management may fail to effectively use the net proceeds of this offering.

As described in “Use of Proceeds,” we intend to use the net proceeds of this offering for general corporate purposes. Our management will have discretion in applying the net proceeds. Allocation of the net proceeds will be subject to future economic conditions, changes in our business plan and our responses to competitive pressures. Accordingly, our management may ineffectively apply a portion of the net proceeds, or may apply the net proceeds in ways that investors did not expect.

A substantial number of shares will be eligible for resale in the near future, which could cause our Class A common stock price to decline.

Sales of our Class A common stock in the public market after the completion of this offering, or even the perception that such sales may occur, could cause the market price of our Class A common stock to decline. Upon the completion of this offering, we will have shares of Class A common stock outstanding, assuming no exercise of the underwriters’ option to purchase additional shares or any outstanding stock options. The shares to be sold in this offering will be freely tradable without restriction or further registration under the Securities Act of 1933, as amended (the “Securities Act”). In addition, there will be shares of our Class B common stock outstanding at the completion of this offering held by Mr. Claure, which may be converted into shares of Class A common stock at any time and, under certain circumstances, will automatically be converted to shares of Class A common stock. Substantially all of the shares of the outstanding Class A common stock and the outstanding Class B common stock owned by our existing stockholders will be subject to lock-up agreements with the underwriters that restrict their ability to transfer capital stock for a period of at least 180 days from the date of this prospectus (or, as long as the company remains certified as a minority business enterprise, at least 365 days in the case of Mr. Claure). For a more detailed description of these agreements, see “Shares Eligible for Future Sale — Lock-up Agreements” and “Underwriting.” After the lock-up agreements expire, an aggregate of shares of Class A common stock (excluding the shares to be redeemed by us or sold upon any exercise of the underwriters’ option to purchase additional shares) and Class B common stock will be eligible for resale in the public market, subject to the applicable limitations of either Rule 144 or Rule 701 under the Securities Act. For a more detailed discussion of the shares eligible for future sale, see “Shares Eligible for Future Sale.”

Goldman, Sachs & Co. and J.P. Morgan Securities LLC, on behalf of all the underwriters, may in their discretion, at any time and without notice, release all or any portion of the shares subject to the lock-up agreements, which would result in shares being available for sale in the public market at an earlier date. Conversion of Class B common stock into Class A common stock and sales of Class A common stock by existing stockholders in the public market, the availability of these shares for resale or our future issuance of additional securities could cause the market price of our Class A common stock to decline, perhaps significantly.

Following the completion of this offering and the expiration of the lock-up period, assuming the conversion of our redeemable convertible preferred stock, the holders of an aggregate of shares of our Class A common stock (excluding the shares to be sold upon any exercise of the underwriters’ option to purchase additional shares) will be entitled to register their shares of common stock under the Securities Act. We have also granted demand and piggyback registration rights to the holders of shares of our Class A common stock. For a more detailed discussion of these registration rights, see “Certain Relationships and Related Party Transactions—Stockholders’ Agreement” and “Shares Eligible for Future Sale.”

Fulfilling our public company financial reporting and other regulatory obligations will be expensive and time consuming and may strain our resources.

As a public company, we will be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and will be required to implement specific corporate governance practices and adhere to a variety of reporting requirements under the Sarbanes-Oxley Act of 2002 (“Sarbanes-Oxley”) and the related rules and regulations of the Securities and Exchange Commission (the “SEC”), as well as the rules of The Nasdaq Stock Market.

In accordance with Section 404 of Sarbanes-Oxley, our management will be required to conduct an annual assessment of the effectiveness of our internal control over financial reporting and include a report on these internal controls in the annual reports we will file with the SEC on Form 10-K as required. In addition, we will be required to have our independent registered public accounting firm provide an opinion regarding the effectiveness of our internal controls. We are in the process of reviewing our internal control over financial reporting and are establishing formal policies, processes and practices related to financial reporting and to the identification of key financial reporting risks, assessment of their potential impact and linkage of those risks to specific areas and controls within our organization. If we are not able to implement the requirements of Section 404 in a timely manner or with adequate compliance, we may be subject to adverse regulatory consequences and there could be a negative reaction in the financial markets due to a loss of investor confidence in us and the reliability of our financial statements. This could have a material adverse effect on our business and lead to a decline in the price of our Class A common stock.

The Exchange Act will require us to file annual, quarterly and current reports with respect to our business and financial condition. Compliance with these requirements will place significant additional demands on our legal, accounting and finance staff and on our accounting, financial and information systems and will increase our legal and accounting compliance costs as well as our compensation expense as we will be required to hire additional accounting, finance, legal and internal audit staff with the requisite technical knowledge.

As a public company we will also need to enhance our investor relations, marketing and corporate communications functions. These additional efforts may strain our resources and divert management’s attention from other business concerns, which could have a material adverse effect on our business.

CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

We have made statements under the captions “Prospectus Summary,” “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” “Business” and in other sections of this prospectus that are forward-looking statements. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include projections of our future financial performance, our anticipated growth strategies and anticipated trends in our business. These statements are predictions based on our current expectations and projections about future events which we believe are reasonable. There are important factors that could cause our actual results, level of activity, performance or achievements to differ materially from the results, level of activity, performance or achievements expressed or implied by the forward-looking statements, including those factors discussed under the caption entitled “Risk Factors.” You should specifically consider the numerous risks outlined under “Risk Factors.”

Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, level of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements. Except as required by law, we assume no duty to update any of these forward-looking statements after the date of this prospectus to conform our prior statements to actual results or revised expectations.

USE OF PROCEEDS

We will receive net proceeds from this offering of approximately $ million, or approximately $ million if the underwriters exercise their option to purchase additional shares in full, assuming an initial offering price of $ per share, the midpoint of the range set forth on the cover page of this prospectus. We intend to use $ million of the net proceeds from this offering to pay accrued dividends on our redeemable convertible preferred stock, including $ to Lindsay Goldberg, an affiliate of the company, and will use the remainder for general corporate purposes. We will not receive any proceeds from the shares of Class A common stock being sold by the selling stockholders identified in this prospectus, which include Mr. Claure and Lindsay Goldberg.

Assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same, a $1.00 change in the assumed initial public offering price of $ per share of Class A common stock (the midpoint of the range set forth on the cover page of this prospectus) would increase or decrease the net proceeds to us by $ million, or approximately $ million if the underwriters exercise their option to purchase additional shares in full.

DIVIDEND POLICY

We have a limited history of paying dividends to our common stockholders. We currently anticipate that we will retain all available funds for use in the operation and expansion of our business and do not anticipate paying any dividends on our Class A or Class B common stock in the foreseeable future. During 2008, we paid a dividend of $0.30 per share to our common stockholders. We will pay accrued dividends on our redeemable convertible preferred stock in connection with this offering. Our ability to pay dividends on our common stock is limited by the covenants of our ABL Revolver and the indenture governing the 2016 Notes.

CAPITALIZATION

The following table sets forth our cash and cash equivalents and capitalization as of March 31, 2011:


	•	on an actual basis;


	•	on a pro forma basis to reflect (1) the conversion of shares of our common stock owned by Mr. Claure into shares of Class A common stock and shares of Class B common stock, and the conversion of shares of our common stock owned by other shareholders into shares of Class A common stock; and (2) the conversion of our redeemable convertible preferred stock into shares of Class A common stock in connection with this offering; and


	•	on a pro forma, as adjusted, basis to reflect the adjustments described in the immediately preceding bullet point and to further reflect the issuance and sale of shares of Class A common stock by us in this offering at an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover page of this prospectus, and the application of the net proceeds of the offering, after deducting estimated underwriting discounts and offering expenses payable by us, as set forth under “Use of Proceeds.”

This table should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the related notes thereto included elsewhere in this prospectus.


	As of March 31, 2011
					Pro Forma, as
	Actual		Pro Forma(1)		Adjusted
	(Unaudited)
	(In thousands, except per share data)

Cash and cash equivalents(2)	$	102,541	$		$

Debt:
Revolving credit facility(3)	$	53,925	$		$
Senior notes(4)		250,000
Trade facilities(5)		—
All other bank facilities(5)		146,406

Total debt		450,331

Redeemable convertible preferred stock(1)		415,359		—		—

Stockholders’ equity:
Common Stock, $0.0001 par value per share, 50,000,000 shares authorized, 18,182,267 shares issued and outstanding, actual; no shares authorized, issued and outstanding, on a pro forma and pro forma as adjusted basis		2		—		—
Class A common stock, $0.0001 par value per share, no shares authorized, issued and outstanding, actual; shares authorized, shares issued and outstanding on a pro forma basis; shares authorized, shares issued and outstanding on a pro forma, as adjusted basis		—
Class B common stock, $0.0001 par value per share, no shares authorized, issued and outstanding, actual; shares authorized, shares issued and outstanding, on a pro forma and pro forma as adjusted basis		—
Additional paid-in capital(2)		52,106
Retained earnings		96,927
Accumulated other comprehensive income		18,152
Non-controlling interest		8,764

Total stockholders’ equity(2)		175,861

Total capitalization(2)	$	1,041,551	$		$


(1)		The certificates of designation for our redeemable convertible preferred stock provide that we have the right to convert all of the outstanding shares of redeemable convertible preferred stock if we consummate an initial public offering, in the case of the Series B Preferred Stock, resulting in gross proceeds of at least $100.0 million and a sale price for the shares of common stock sold in the offering of at least $26.00, in the case of the Series C and Series D Preferred Stock, resulting in gross proceeds of at least $100.0 million and a sale price for the shares of common stock sold in the offering of at least $26.33, and, in the case of the Series E Preferred Stock, resulting in gross proceeds of at least $50 million and a sale price for the shares of common stock sold in the offering of at least $16.00. Based on the assumed initial public offering price of $ per share of Class A common stock (the midpoint of the range set forth on the cover page of this prospectus) and the offering size set forth on the cover of this prospectus, we believe that this offering will satisfy these contingencies.


(2)		Assuming the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same, a $1.00 increase or decrease in the assumed initial public offering price of $ per share of Class A common stock (the midpoint of the range set forth on the cover page of this prospectus) would increase or decrease the amount of cash and cash equivalents, additional paid-in capital, total stockholders’ equity and total capitalization by approximately $ million.


(3)		As of March 31, 2011, we had $334.3 million available under our revolving credit facility.


(4)		In May 2011, we issued an additional $100.0 million aggregate principal amount of 2016 Notes under the indenture dated November 30, 2010, pursuant to which we have previously issued $250.0 million aggregate principal amount of 2016 Notes.


(5)		As of March 31, 2011, we had $50.0 million available in trade financing facilities and $50.3 million available under all other bank facilities.

DILUTION

Our pro forma net tangible book value as of March 31, 2011 was $ , or $ per share of Class A and Class B common stock. Pro forma net tangible book value per share is determined by dividing our tangible net worth, total assets less total liabilities, by the aggregate number of shares of Class A and Class B common stock outstanding upon the completion of this offering and reflecting conversion of our redeemable convertible preferred stock into shares of Class A common stock. After giving effect to the sale by us of the shares of Class A common stock in this offering, at an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover page of this prospectus, and the receipt and application of the net proceeds, our pro forma net tangible book value as of March 31, 2011 would have been $ , or $ per share of Class A and Class B common stock. This represents an immediate increase in pro forma net tangible book value to existing stockholders of $ per share and an immediate dilution to new investors of $ per share. The following table illustrates this per share dilution:


Assumed initial public offering price		$

Pro forma net tangible book value per share as of March 31, 2011	$
Increase in pro forma net tangible book value per share attributable to new investors

Pro forma net tangible book value per share after this offering

Dilution per share to new investors		$

Dilution is determined by subtracting pro forma net tangible book value per share after this offering from the initial public offering price per share.

Assuming the number of shares of Class A common stock offered by us as set forth on the cover page of this prospectus remains the same, a $1.00 increase (decrease) in the assumed initial public offering price of $ per share of Class A common stock (the midpoint of the price range set forth on the cover page of this prospectus) would increase (decrease) the pro forma net tangible book value per share attributable to new investors by $ million, the pro forma net tangible book value (deficit) per share after this offering by $ per share and decrease (increase) the dilution per share to new investors in this offering by $ per share.

The following table sets forth, on a pro forma basis, as of March 31, 2011, the number of shares of Class A common stock purchased from us, the total consideration paid, or to be paid, and the average price per share paid, or to be paid, by existing stockholders and by the new investors, at an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover page of this prospectus, before deducting estimated underwriting discounts and offering expenses payable by us:


	Shares Purchased				Total Consideration				Average Price
	Number	Percent			Amount	Percent			per Share

Existing common stockholders				%	$			%	$
Existing redeemable convertible preferred stockholders (as converted)									$
New investors									$

Total			100	%	$		100	%

Sales by the selling stockholders in this offering will reduce the number of shares held by existing stockholders to or approximately %, shares or approximately % if

the option to purchase additional shares is exercised in full, and will increase the number of shares to be purchased by new investors to or approximately %, shares or approximately % if the option to purchase additional shares is exercised in full, of the total number of shares of common stock outstanding after the offering.

The foregoing tables assume no exercise of the underwriters’ option to purchase additional shares or of outstanding stock options after March 31, 2011. As of March 31, 2011, shares of common stock were subject to outstanding options, which will automatically become options to purchase shares of our Class A common stock upon the completion of this offering, at a weighted average exercise price of $ . To the extent these options are exercised there will be further dilution to new investors.

Assuming the number of shares of Class A common stock offered by us, as set forth on the cover page of this prospectus, remains the same, a $1.00 increase (decrease) in the assumed initial public offering price of $ per share of Class A common stock (the midpoint of the price range set forth on the cover of this prospectus), would increase (decrease) total consideration paid by new investors in this offering and by all investors by $ million, and would increase (decrease) the average price per share paid by new investors by $1.00, and would increase (decrease) pro forma net tangible book value per share by $ .

SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA

The following is our selected consolidated financial and other data, which should be read in conjunction with, and is qualified by reference to, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and notes thereto included elsewhere in this prospectus. The consolidated statement of operations data for the years ended December 31, 2008, 2009 and 2010 and the consolidated balance sheet data as of December 31, 2009 and 2010 are derived from, and qualified by reference to, our audited consolidated financial statements and notes thereto included elsewhere in this prospectus and should be read in conjunction with those consolidated financial statements and notes thereto. The consolidated statement of operations data for the three-month periods ended March 31, 2010 and 2011 and the balance sheet data at March 31, 2011 are derived from, and qualified by reference to, our unaudited interim consolidated financial statements and include all adjustments, consisting of normal and recurring adjustments that we consider necessary for a fair presentation of the financial position as of such date and results of operations for such periods. Operating results for the three months ended March 31, 2011 are not necessarily indicative of the results that may be expected for the full year. The consolidated balance sheet data as of December 31, 2008 is derived from our audited consolidated financial statements not included in this prospectus. The consolidated statement of operations data for the years ended December 31, 2006 and 2007 and the consolidated balance sheet data as of December 31, 2006 and 2007 are derived from our unaudited consolidated financial statements not included in this prospectus.


																Three Months Ended
	Year Ended December 31,															March 31,
	2006			2007			2008			2009			2010			2010			2011
																(Unaudited)
	(In thousands, except share and per share data)

Consolidated Statement of Operations Data:
Revenue	$	3,555,674		$	3,492,476		$	3,550,165		$	2,718,652		$	4,612,863		$	767,377		$	1,267,874
Cost of revenue		3,257,352			3,189,935			3,254,167			2,354,016			4,218,979			682,678			1,157,310

Gross profit		298,322			302,541			295,998			364,636			393,884			84,699			110,564

Operating expenses:
Selling, general and administrative		135,192			197,530			174,287			161,806			235,239			46,788			65,278
Provision for bad debts		7,776			1,956			2,736			6,435			8,785			9,462			(607	)
Depreciation and amortization		4,800			6,820			9,917			13,457			11,913			2,611			3,389
Public offering expenses		—			—			—			—			7,333			5,400			—

Total operating expenses		147,768			206,306			186,940			181,698			263,270			64,261			68,060

Operating income		150,554			96,235			109,058			182,938			130,614			20,438			42,504

Other income (expenses):
Interest income		1,794			9,746			14,206			21,278			7,139			1,826			1,460
Interest expense		(40,971	)		(46,366	)		(34,746	)		(17,102	)		(29,025	)		(5,798	)		(13,858	)
Other income (expenses), net(1)		(10,696	)		(4,543	)		(923	)		(3,459	)		2,159			8			1,805
Foreign exchange gains (losses), net		900			2,648			(25,117	)		(80,915	)		(33,263	)		(17,237	)		(2,486	)
Loss on early extinguishment of debt		—			(38,903	)		—			—			—			—			—

Total other expenses		(48,973	)		(77,418	)		(46,580	)		(80,198	)		(52,990	)		(21,201	)		(13,079	)

Income (loss) from continuing operations before provision for income taxes		101,581			18,817			62,478			102,740			77,624			(763	)		29,425
Provision for income taxes		33,862			19,515			35,402			46,999			36,938			3,337			10,755

Income (loss) from continuing operations		67,719			(698	)		27,076			55,741			40,686			(4,100	)		18,670
(Loss) income from discontinued operations, net of taxes		(2,840	)		(16,771	)		(14,304	)		2,595			(921	)		(9	)		(32	)

Net income (loss)		64,879			(17,469	)		12,772			58,336			39,765			(4,109	)		18,638
Less: Net income attributable to non-controlling interest		13,749			18,753			18,107			4,095			2,385			331			965

Net income (loss) attributable to Brightstar Corp.	$	51,130		$	(36,222	)	$	(5,335	)	$	54,241		$	37,380		$	(4,440	)	$	17,673


															Three Months Ended
	Year Ended December 31,														March 31,
	2006			2007			2008			2009		2010			2010			2011
															(Unaudited)
	(In thousands, except share and per share data)

Basic earnings per share for common stock:
Income (loss) from continuing operations attributable to Brightstar Corp. common stockholders	$	1.85		$	(3.36	)	$	0.50		$	0.83	$	0.35		$	(0.59	)	$	0.30
(Loss) income from discontinued operations attributable to Brightstar Corp. common stockholders		(0.11	)		(0.85	)		(0.79	)		0.07		(0.03	)		—			—

Net income (loss) attributable to Brightstar Corp. common stockholders	$	1.74		$	(4.21	)	$	(0.29	)	$	0.90	$	0.32		$	(0.59	)	$	0.30

Diluted earnings per share for common stock:
Income (loss) from continuing operations attributable to Brightstar Corp. common stockholders	$	1.65		$	(3.36	)	$	0.20		$	0.78	$	0.35		$	(0.59	)	$	0.29
(Loss) income from discontinued operations attributable to Brightstar Corp. common stockholders		(0.09	)		(0.85	)		(0.41	)		0.06		(0.03	)		—			—

Net income (loss) attributable to Brightstar Corp. common stockholders	$	1.56		$	(4.21	)	$	(0.21	)	$	0.84	$	0.32		$	(0.59	)	$	0.29

Weighted average number of common shares outstanding:
Basic		21,454,431			19,714,092			18,134,166			18,163,037		18,181,347			18,178,538			18,182,267

Diluted		25,589,280			19,714,092			35,046,068			20,863,930		18,586,404			18,178,538			18,914,897


	As of December 31,										March 31,
	2006		2007		2008		2009		2010		2011
											(Unaudited)
	(In thousands)

Consolidated Balance Sheet Data:
Cash and cash equivalents	$	64,803	$	89,491	$	122,057	$	239,859	$	159,161	$	102,541
Accounts receivable, net		810,219		972,062		864,222		969,184		1,376,445		1,143,762
Inventory		702,638		393,637		316,472		239,988		612,396		758,123
Total assets		1,695,728		1,651,517		1,574,140		1,813,839		2,496,570		2,385,598
Total debt(2)		542,937		569,950		445,408		401,848		453,805		450,331
Total liabilities		1,415,180		1,175,222		1,116,347		1,319,326		1,929,758		1,794,378
Total redeemable convertible preferred stock		76,292		329,742		329,742		362,377		409,090		415,359
Total stockholders’ equity		204,256		146,553		128,051		132,136		157,722		175,861


(1)		The table below presents the consolidated other income (expenses), net attributable to Brightstar Europe:


	Year Ended December 31,												Three Months Ended March 31,
	2006		2007			2008			2009		2010		2010		2011
													(Unaudited)
	(In thousands)

Other income (expenses), net attributable to Brightstar Europe	$	—	$	(2,806	)	$	(4,744	)	$	1,781	$	2,413	$	834	$	2,806


(2)		Total debt is defined as lines of credit, trade financing facilities and current portion of term debt, long-term debt and convertible senior subordinated notes.

MANAGEMENT’S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this prospectus. This discussion contains forward-looking statements that involve various risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements. For additional information regarding some of the risks and uncertainties that affect our business and the industry in which we operate, please read “Risk Factors” and “Special Note Regarding Forward-Looking Statements.”

Overview

We are a leading global services company focused on enhancing the performance and profitability of the key participants in the wireless device value chain: manufacturers, operators, retailers and enterprises. We provide a comprehensive range of customized services consisting of value-added distribution, supply chain, retail and enterprise and consumer services. Our services help our customers manage the growing complexity of the wireless device supply chain and allow them to increase the number and type of wireless devices they sell, extend and expand the number of locations at which they sell them, and drive supply chain efficiencies which minimize their costs and therefore improve profitability. In addition, our services help our customers generate demand for wireless devices and decrease the time between sourcing and selling of devices at the point of sale which drives incremental revenues and profits for our customers. The rapid growth of the approximately $200 billion global wireless industry and increasing number and type of wireless activatable devices have resulted in a complex ecosystem where manufacturers, operators, retailers and enterprises have differing priorities and are burdened with tasks that are critical, but not core, to their businesses. We believe that our global presence, scale and position as a key interface between the different participants in the wireless ecosystem provide us with unique insight into the entire wireless device value chain and enhance our ability to offer differentiated, value-added services to our customers.

We are a global organization supporting manufacturers, operators, retailers and enterprises and reach over 90,000 points of sale worldwide. Our customers are some of the leading companies in the wireless device value chain. Among others, our customers include manufacturers such as LG, Motorola, Nokia, RIM and Samsung; operators such as America Movil, Iusacell, Movilnet, Telefonica and Telstra; retailers such as Best Buy, Walmart and Wireless Advocates; and enterprises such as PC Connection.

For our value-added distribution services, and under the terms of certain arrangements, we procure and take title to wireless devices and re-sell them to our customers around the world; the revenue we generate for these value-added distribution services is transaction-based and includes the cost of the devices we sell. For our other services, we primarily charge a contractual fee for services provided or enter into gain-sharing arrangements, whereby we earn a percentage of the savings we generate for the customer.

Our business is conducted in four geographic regions: (i) U.S./Canada; (ii) Latin America; (iii) Asia Pacific, Middle East and Africa (“Asia Pacific”); and (iv) Europe, through Brightstar Europe, our 50% owned joint venture with Tech Data. The first three regions are reported as geographic operating segments in our consolidated financial statements, and we include our share of income from Brightstar Europe in other income (expenses), net.

Regional Highlights and Outlook


	•	*U.S./Canada.* For the year ended December 31, 2010, revenue in our U.S./Canada region was approximately $1.5 billion, which accounted for 31.9% of our total revenue in 2010, compared to 26.6% in 2009 and 18.3% in 2008. The growth in this region has been driven


		primarily by the addition of new retailer customers and the rapid expansion of our business in the retail and dealer agent distribution networks. We have over 700 customers in this region, including over 600 retailers. Our core services in the region include value-added distribution, management of wireless device returns, management of the entire wireless device category for certain customers, supply chain management, product portfolio management and virtual inventory, activation services, in-store marketing and handset protection and replacement. In October 2010, we acquired OTBT, Inc., a provider of enterprise services for small and medium businesses and large enterprises in the U.S. and a core component of our enterprise services offering. We operate over 450,000 square feet of facilities and serve over 60,000 points of sale throughout the region. Following a period of rapid expansion in this region, we intend to increasingly focus on improving the profit margin profile, which we expect will result in lower revenue over the short term but higher profitability.


	•	*Latin America.* For the year ended December 31, 2010, revenue in our Latin America region was approximately $2.7 billion, which accounted for 60.1% of our total revenue in 2010, compared to 66.9% in 2009 and 76.1% in 2008, excluding the effect of the Venezuela increase in revenue in 2009 and early 2010 related to specific transactions executed through the parallel market. See “— Significant Issues Affecting Comparability from Period to Period — Venezuela Business.” Historically, our Latin America region contributed the majority of our total revenue, but, in recent years, the region’s overall contribution to total revenue has been decreasing due to the higher relative growth of our other regions. We operate in 19 countries across this region, including Argentina, Brazil, Colombia, Mexico and Venezuela. Our core services in Latin America include value-added distribution, and management of the wireless device category for customers including demand planning and forecasting, and fulfillment and logistics, which includes freight management and customs clearance. We operate over 600,000 square feet of warehouse facilities serving this region, including our Miami distribution center. We have 43 sales, distribution and assembly facilities that together serve more than 90 operators and 25,000 customers in this region. Our assembly facility in Tierra del Fuego, Argentina allows us to provide local production capability for our customers. We expect our revenue to increase in this region driven by continued growth in our services and increased penetration of smartphones.


	•	*Asia Pacific.* For the year ended December 31, 2010, revenue in our Asia Pacific region was $367.2 million, which accounted for 8.0% of our total revenue in 2010, compared to 6.5% in 2009 and 5.6% in 2008. The growth in this region has been driven primarily by our efforts to expand our service offerings and enter new markets. We operate in 14 countries across this region, including Australia, Hong Kong, Malaysia, New Zealand, Singapore, South Africa, Thailand, Turkey and Vietnam. We have six distribution facilities that together serve more than 24 manufacturers, 13 operators and 3,100 retailers at approximately 10,000 points of sale. Our core services in the region include supply chain planning, such as demand forecasting and inventory management, and wireless device management, which includes services such as lifecycle management which help our customers increase the speed at which devices are sold. We also offer a full range of strategic sourcing services, which help our customers obtain wireless devices at competitive prices, distribution channel management and value-added distribution services. We operate more than 350,000 square feet of warehouse facilities in the region. We expect our revenue to increase and gross margins to decrease in this region as we expand our value-added distribution services business at a faster rate than our other services and as we expand into new markets.


	•	*Europe.* We own a 50% interest in Brightstar Europe, a joint venture company formed in 2007, which is owned equally and controlled jointly by Tech Data and us. The growth in this region has been driven primarily by market penetration, geographic expansion and, to a lesser extent, impact from our recent acquisitions. Our income attributable to Brightstar Europe operations increased from $1.8 million in 2009 to $2.4 million in 2010. We operate in 15


		countries across this region, including Spain, Germany and United Kingdom. Brightstar Europe utilizes the distribution facilities maintained by Tech Data. Brightstar Europe’s core services in the region include value-added distribution and enterprise services. In August 2010, Brightstar Europe acquired AKL Telecommunications GmbH (“AKL”). AKL is one of Austria’s leading suppliers of mobile phones and fixed line telephone solutions to the wireless channels including telecommunications dealers and consumer electronics stores. In addition, in October 2010, Brightstar Europe acquired Mobile Communication Company (“MCC”), a major supplier of mobile phones and personal navigation devices in the Netherlands and Belgium. Brightstar Europe has been growing rapidly since its formation, as the joint venture increases its presence in the region. We expect Brightstar Europe’s revenue and gross profit to continue to grow organically and from the full-year impact of its 2010 acquisitions of AKL and MCC.

We expect our business to grow in both revenue and profitability as we expand into new markets, continue to leverage the scale of our global infrastructure and grow our value-added distribution, supply chain, retail and enterprise services.

Key Metrics

We monitor key financial metrics, as set forth below, to help us evaluate trends in our business, establish budgets, measure the effectiveness of our sales and marketing efforts and assess operational efficiencies. See “Prospectus Summary — Summary Consolidated Financial and Other Data” for definitions and calculations related to Adjusted gross profit, Adjusted EBITDA and Adjusted net income.


										Three Months
	Year Ended December 31,									Ended March 31,
	2008			2009			2010			2010			2011
	(In thousands, except percentages)

Revenue	$	3,550,165		$	2,718,652		$	4,612,863		$	767,377		$	1,267,874
Other Financial Data:
Gross profit		295,998			364,636			393,884			84,699			110,564
Gross margin		8.3	%		13.4	%		8.5	%		11.0	%		8.7	%
Adjusted gross profit(1)		295,998			279,040			382,680			71,703			110,564
Adjusted gross margin(2)		8.3	%		10.3	%		8.3	%		9.3	%		8.7	%
Operating income		109,058			182,938			130,614			20,438			42,504
Operating income %		3.1	%		6.7	%		2.8	%		2.7	%		3.4	%
Adjusted EBITDA(1)		118,247			111,424			141,192			15,627			48,457
Adjusted EBITDA %(2)		3.3	%		4.1	%		3.1	%		2.0	%		3.8	%
Net income		12,772			58,336			39,765			(4,109	)		18,638
Net income %		0.4	%		2.1	%		0.9	%		(0.5	)%		1.5	%
Adjusted net income(1)		12,299			58,742			60,561			6,742			20,306
Adjusted net income %(2)		0.3	%		2.2	%		1.3	%		0.9	%		1.6	%
Working capital(3)		460,007			392,844			607,976			358,514			678,230
Working capital %(2)(4)		13.0	%		14.4	%		13.2	%		11.7	%		13.4	%


(1)		See Note (3) in “Prospectus Summary — Summary Consolidated Financial and Other Data” for reconciliations of gross profit to Adjusted gross profit, net income to Adjusted EBITDA and net income to Adjusted net income.

(2)		Expressed as a percentage of revenue.


(3)		Working capital is calculated as total current assets minus total current liabilities.


(4)		For the three months ended March 31, 2010 and 2011, the working capital percentage is calculated by dividing working capital by annualized quarterly revenue.

We use the following financial metrics in monitoring our business:


	•	*Adjusted Gross Profit.* While Adjusted gross profit is not a U.S. GAAP measurement, we believe it is useful in comparing our performance with our results in prior periods, as well as with the performance of other companies, as the items excluded to arrive at Adjusted gross profit are not indicative of operating performance and therefore limit comparability of our historical and current financial statements.

	•	*Adjusted EBITDA.* While Adjusted EBITDA is not a U.S. GAAP measurement, we believe it is useful in evaluating our operating performance compared to that of other companies because the calculation of Adjusted EBITDA generally eliminates the effects of financing and income taxes and the accounting effects of capital spending and other discrete items, which we believe are not indicative of overall operating performance. We use Adjusted EBITDA to evaluate the operating performance of our business and aid in the period-to-period comparability.

	•	*Adjusted Net Income.* While Adjusted net income is not a U.S. GAAP measurement, we believe it is useful in evaluating our operating performance compared to that of other companies because its calculation adjusts for items which we believe are not indicative of overall operating performance. We use Adjusted net income to evaluate the operating performance of our business and aid in period-to-period comparability.


	•	*Working Capital.* Working capital is a measure calculated as total current assets minus total current liabilities. We believe it is useful in evaluating our operating performance compared to that of other companies because it is indicative of our ability to pay off our short-term liabilities without having to raise additional capital.

The following items are excluded from the computation of Adjusted EBITDA:


	•	*Provision for Income Taxes.* Our U.S. GAAP financial results include a provision for income taxes. Although we are subject to various federal, state and foreign taxes and the payment of such taxes is a necessary element of our operations, we exclude our provision for income taxes from our Adjusted EBITDA financial measure to provide period-to-period comparability of our operating results unassociated with the varying effective tax rates and uncertain tax position reserves to which we are subject.

	•	*Interest Income.* Our U.S. GAAP financial results include interest income. Although our investing activities are elements of our cost structure and provide us with the ability to generate returns for our owners, we exclude interest income from our Adjusted EBITDA financial measure to provide period-to-period comparability of our operating results unassociated with our investing activities.

	•	*Interest Expense.* Our U.S. GAAP financial results include interest expense. Although our borrowing activities are key elements of our cost structure and provide us with the ability to generate revenue and returns for our stockholders, we exclude interest expense from our Adjusted EBITDA financial measure to provide period-to-period comparability of our operating results unassociated with our capital structure or borrowing activities.

	•	*Depreciation and Amortization.* Our U.S. GAAP financial results include depreciation and amortization expense associated with capital expenditures and intangible assets acquired in transactions accounted for as business combinations. While the use of the capital equipment and intangible assets enable us to generate revenue for our business, we exclude depreciation and amortization expense from our Adjusted EBITDA financial measure to evaluate our operating results and to enable us to compare our financial results with other companies in our industry without regard to the historical acquisition costs of our assets.

	•	*Impairment of Upfront Fee.* Our U.S. GAAP financial results include an impairment of an upfront fee. Since the impairment of an upfront fee is not a normal, recurring part of our business, we exclude it from our Adjusted EBITDA financial measure to provide


		period-to-period comparability of our operating results. See Note 14 to our consolidated financial statements included elsewhere in this prospectus.


	•	*Public Offering Expenses.* Our U.S. GAAP financial results include public offering expenses. Since public offering expenses are not a normal, recurring part of our business, we exclude them from our Adjusted EBITDA financial measure to provide period-to-period comparability of our operating results.

	•	*Share-Based Compensation Expense.* Our U.S. GAAP financial results include share-based compensation expense which is composed of the fair value of each of our incentive awards under our stock option plans. While share-based compensation expense is required under the provisions of ASC 718, we exclude share-based compensation expense from our Adjusted EBITDA financial measure to enable us to compare our financial results with other companies in our industry.

	•	*Loss (income) from Discontinued Operations, Net of Taxes.* Our U.S. GAAP financial results include a loss from discontinued operations associated with businesses we no longer own and operate. While discontinued operations may arise in future periods, we exclude our gain or loss from discontinued operations from our Adjusted EBITDA financial measure to provide period-to-period comparability of our operating results unassociated with discontinued operations.

	•	*Other Income (Expenses), Net.* Our U.S. GAAP financial results include other income (expenses), net. Although we earn other income and incur other expenses in each period, we exclude other income (expenses), net from our Adjusted EBITDA financial measure, as we believe they are not indicative of our operating performance.

	•	*Foreign Exchange Gains (Losses), Net.* Our U.S. GAAP financial results include foreign exchange gains (losses), net. We exclude these from our Adjusted EBITDA financial measure, with the exception of our foreign currency losses incurred in Venezuela in 2009 and early 2010 related to specific transactions executed through the parallel market. These are reflected as a reduction of revenue in our Adjusted EBITDA as we believe this presentation is more indicative of our operating performance. See “ — Significant Issues Affecting Comparability from Period to Period — Venezuela Business” for further discussion of foreign currency losses and parallel market transactions in Venezuela.


	•	*Acquisition Costs.* Our U.S. GAAP financial results include acquisition costs. We exclude acquisition costs from our Adjusted EBITDA financial measure to provide period-to-period comparability of our operating results.

Key Components of Operating Results

Revenue

Revenue is derived primarily from the following models:


	•	value-added distribution services revenue from sales of wireless devices to operators and retailers, net of returns, allowances and early payment discounts, and generally including the cost of devices we resell;


	•	fixed or variable fee arrangements that contain contingent payments which are incentive compensation arrangements based on performance, designed to link a portion of our revenue to our performance relative to both qualitative and quantitative goals;


	•	a “cost plus margin” arrangement for specific services performed under a contract; and

	•	a “gain-sharing” arrangement, under which we typically earn a percentage of savings we generate for our customers.

Our value-added distribution services revenue from sales of wireless devices is subject to product availability and seasonal fluctuations as a result of holidays, manufacturer and operator promotions and other events affecting customer demand, including the introduction of new products and general economic conditions, and represents the majority of our revenue, including the cost of devices we resell. As a result,

we generally experience higher revenue in the second half of the year, particularly in the fourth quarter due to the holiday season, as compared to the first half of the year.

Our revenue generated by fixed or variable fee or cost plus margin arrangements is dependent on our ability to perform and maintain service contracts and less dependent on seasonality fluctuations. The fees earned under gain-sharing arrangements depend on the level of savings we achieve for our customers and typically decrease over the term of the contract as cost savings opportunities are identified and remaining opportunities for cost savings diminish.

Cost of Revenue

Cost of revenue for sales of wireless devices consists of direct costs incurred for services rendered. Our cost of revenue also includes commissions to direct sales agents, freight, insurance, import duties, warranty costs, royalties, provisions for excess and obsolete inventories and the cost of the wireless devices and accessories that we sell, net of any discounts that we receive from our manufacturer customers.

Gross Profit

Gross profit is driven by revenue and the margins we earn on that revenue. Margins fluctuate based on the mix of products sold and services rendered, variations in other costs of revenue and fluctuations in gain-sharing revenue. Our overall gross profits may vary from period to period depending largely on mix of services provided and products distributed, seasonality and the lifecycle of our various contracts with our customers. Our value-added distribution services are lower margin relative to our other services and vary with the type of device that we distribute, with higher value devices such as smartphones generating higher margins for us relative to basic phones.

In certain distribution contracts for large customers, the prices of the wireless devices that we sell are generally negotiated directly between the manufacturers and our operator customers. In such cases, we earn an agreed-upon margin, and, in some instances, we are guaranteed minimum payments from our manufacturer customers (even where the purchase price payable by the customer is subsequently reduced). In other cases, we play an active role in negotiating the sales prices or fees that determine our margins. In our other, non-distribution services, the margins we earn on these services vary depending on the nature of the service and the fee arrangement in place which are negotiated directly between us and our customers. With the exception of services under gain sharing arrangements where the gross margins decline over the lifecycle of the contract, our gross margins for our other services are typically relatively stable over the term of the contract.

As discussed further in “—Significant Issues Affecting Comparability from Period to Period — Venezuela Business,” our gross profits and gross margins were affected in 2009 and early 2010 by the highly inflationary economy in Venezuela.

Selling, General and Administrative

Our selling, general and administrative expenses consist primarily of personnel costs, benefits, facility expenses, administrative costs, information technology costs, professional fees and selling and marketing costs. Selling, general and administrative expenses also include share-based compensation expense. The selling, general and administrative expenses that are directly attributable to a region’s operations are recorded by that region, and corporate selling, general and administrative expenses relating to our corporate headquarters are allocated to our regions based on a combination of factors, including revenue and earnings.

We expect selling, general and administrative expenses to increase as we expand our business and hire additional personnel. To the extent that our revenue grows, we expect our selling, general and administrative expenses as a percentage of our revenue to decrease as we continue to leverage our fixed and discretionary selling, general and administrative expenses. As with most of our operations, we can adjust our cost structure related to our business based on the actual amount of services contracted.

Provision for Bad Debts

Historically, our bad debt provision has been low, at less than 0.25% of our revenue in each of the last three years.

Depreciation and Amortization

Depreciation and amortization expense relates primarily to leasehold improvements, computer equipment and software, furniture, fixtures, equipment and warehouse handling and storage equipment. We also record amortization expense related to intangible assets.

Public Offering Expenses

Public offering expenses are comprised of certain expenses incurred in preparation for our initial public offering.

Interest Income

Interest income is comprised of interest earned on bank deposits and interest we collect from customers for past due payments on accounts receivable.

Interest Expense

Interest expense consists primarily of the costs of our borrowings under our ABL Revolver and other credit facilities, the costs associated with letters of credit and the amortization of loan costs. In addition, starting in December 2010, we had a fixed interest expense related to our 2016 Notes.

Other Income (Expenses), Net

Other income (expenses), net includes non-operating gains and losses, including our share of income (loss) from Brightstar Europe and investment gains, losses and other than temporary impairments. Since 2010, other income (expenses), net has also included rental income and depreciation related to investment property acquired in Venezuela during 2009 and 2010.

Foreign Exchange Gains (Losses), Net

We operate in many countries where the exchange rates of local currencies for U.S. dollars fluctuate. In countries where our foreign subsidiaries use the local currency as their functional currency, foreign exchange gains and losses arise in connection with transactions denominated in a currency other than that functional currency. Additionally, in countries where our foreign subsidiaries use the U.S. dollar as their functional currency, foreign exchange gains and losses arise when monetary assets and liabilities denominated in foreign currencies are re-measured into U.S. dollars for consolidated financial reporting purposes. Foreign exchange gains and losses are included in our consolidated statement of operations, net of gains (losses) from forward contracts used to hedge currency risks. See “—Significant Issues Affecting Comparability from Period to Period — Worldwide Currency Fluctuations” for a discussion regarding the effect of currency devaluations in 2008 on our business.

Provision for Income Taxes

The provision for income taxes includes federal, state, local and foreign taxes. Income taxes are accounted for under the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial statement carrying values and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which the temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the

enactment date. We evaluate the realizability of our deferred tax assets and establish a valuation allowance when it is more likely than not that all or a portion of the deferred tax assets will not be realized.

Non-Controlling Interest

Non-controlling interest reflects the portion of our consolidated earnings attributable to investors that hold non-controlling ownership interests in certain of our consolidated subsidiaries.

Prior to March 31, 2009, a third party held a 40.0% interest in our Australian operations and a 30.0% interest in our Singapore operations. On March 31, 2009, pursuant to a conversion agreement, this investor elected to convert the non-controlling interest in our Singapore operations into shares of our Series C Redeemable Convertible Preferred Stock and concurrently we repurchased the investor’s 40.0% interest in our Australian operations for $40.0 million in cash. Also, on March 31, 2009, we acquired an additional 9.8% interest in one of our subsidiaries, decreasing the holdings of the non-controlling stockholder in that subsidiary to 39.2%.

Significant Issues Affecting Comparability from Period to Period

Certain significant items or events should be considered to better understand differences in our results of operations from period to period. We believe that the following items or events have significantly affected our financial results for prior periods and the results we may achieve in the future:

Venezuela Business

We have a significant presence in Venezuela. While Venezuela’s political and economic environment has been challenging, our operations in Venezuela have been profitable to date, and we have not been required to record any asset impairments for our Venezuela operations. However, the economic situation in Venezuela and related accounting treatment has caused significant variability in our reported results, as described below.

Venezuela’s economy was deemed to meet the definition of highly inflationary as of July 1, 2009. As a result of this determination, we changed the functional currency of our Venezuelan subsidiary to the U.S. dollar, the reporting currency of the parent, Brightstar Corp., effective July 1, 2009. As a consequence of this change in functional currency, the effect of all Venezuelan currency fluctuations are classified as foreign exchange gains and losses and included in the determination of earnings, beginning July 1, 2009.

Pursuant to certain foreign currency exchange control regulations in Venezuela, BCV centralizes the purchase and sale of foreign currency within the country. Under these regulations, the purchase and sale of foreign currency were required to be made at an official rate of exchange that is fixed from time to time by the Executive Branch and the BCV (the “Official Rate”). As of December 31, 2009, the exchange rate was BsF 2.150 per U.S. dollar. Prior to June 2010, we utilized an exemption from the Venezuelan legal prohibition against exchanging Venezuelan currency with other foreign currency that permitted certain transactions under an indirect “parallel” market of foreign currency exchange. The average rate of exchange in the parallel market was variable and at times differed significantly from the Official Rate.

We are required to measure all transactions in Venezuela using the Official Rate, including those actually settled using the parallel market, as we expect future dividends remitted from our Venezuelan subsidiary will be settled using the Official Rate. Accordingly, if we sold a handset for BsF 2.150, and had costs of BsF 1.075 on December 31, 2009, we accounted for such sale as $1 of revenue and $0.50 of gross profit (based on the Official Rate), even though our actual realization in U.S. dollars under the parallel market would reflect much lower revenue and lower gross profits in U.S. dollars. The higher reported revenue and gross profit in this example would be partially offset by foreign

exchange losses resulting from execution of the trades in the parallel market. In 2009 and 2010, our reported gross profit and gross margin benefited significantly from the impact of recording Venezuelan sales at the Official Rate as opposed to the realized rate in the parallel market, primarily in the second and third quarters of 2009. The impact of this was a $85.6 million and $22.2 million increase in revenue in 2009 and 2010, respectively, offset by a corresponding foreign exchange loss. For management and region reporting purposes, we classify these losses as reductions in revenue in our Latin America region because we believe doing so provides a more meaningful measure of actual performance in Venezuela.

In the fourth quarter of 2009, we curtailed the use of the parallel market and began to require letters of credit from the customers’ banks confirmed by banks in the United States as guarantee of payment for our product sales to our Venezuelan customers. In addition to this form of sales transaction, we continued to occasionally execute transactions through the parallel market through early 2010.

On January 8, 2010, the Venezuelan government announced its intention to devalue its currency and move to a two-tier exchange structure, effective January 11, 2010: a 2.60 BsF rate to the USD for transactions deemed priorities by the government and a 4.30 BsF rate to the USD for other transactions. The latter rate was applicable to our operations in Venezuela. In May 2010, the Venezuelan government enacted reforms to its exchange regulations to close the parallel market. In early June 2010, the Venezuelan government introduced additional foreign exchange regulations under SITME, a newly regulated system, which is controlled by the BCV. The SITME imposes volume restrictions on an entity’s foreign trading activity. Foreign exchange transactions occurring after SITME began in June 2010 and which are not conducted through CADIVI or SITME may not comply with the amended exchange regulations. As a result, we further curtailed our parallel market activity in the first half of 2010 and no longer conduct transactions through a parallel market in Venezuela.

In December 2010, the Venezuelan government announced a currency devaluation, effective January 2011, wherein the Bolivar would have one set government rate, eliminating the previously existing BsF 2.60 rate to the USD for transactions deemed priorities by the government. This announcement resulted in one official rate of BsF 4.30 to the USD for all transactions. This change had no impact on our operations as the BsF 4.30 rate to the USD was the existing rate applicable to our operations in Venezuela. As a result of such change, we expect that our revenue and gross profits in Venezuela on a reported basis (prior to any offset for foreign currency gains and losses) will more accurately reflect our actual results.

In 2010, our sales to customers in Venezuela represented 10.5% of our consolidated revenue compared to 19.4% in 2009 and 18.4% in 2008. The decrease in revenue share in 2010 relative to 2009 was primarily attributable to higher growth in our other geographic regions and, to a lesser extent, to the Venezuelan government revising its foreign exchange laws to prohibit private trading of foreign currency. The increase in revenue in 2009 relative to 2008 was mainly attributable to the pricing effect of the highly inflationary economy in Venezuela, as further discussed above.

Worldwide Currency Fluctuations

In 2008, when the major currencies around the world devalued in relation to the U.S. dollar, we did not have a comprehensive currency hedging program in place and our business suffered realized and unrealized foreign exchange losses, which were reflected in 2008, principally as a result of transactions denominated in U.S. dollars. We recognized net foreign exchange losses of $25.1 million in 2008 in connection with these currency fluctuations. The major losses were reflected in the Brazilian real, Mexican peso and Chilean peso.

We now use a hedging strategy to protect against an increase in the cost of forecasted foreign currency denominated transactions where markets exist for hedging instruments. Our objective is to minimize our exposure to these risks through a combination of normal operating activities, or natural hedges, and the utilization of foreign currency contracts to manage our exposure on the transactions

denominated in currencies other than the applicable functional currency. Contracts are executed with creditworthy banks and other institutions and are denominated in currencies of major industrial countries. In certain cases, including Venezuela, derivative hedging instruments are not available. In those circumstances, we use a combination of strategies to the extent feasible, including but not limited to, natural hedges and adjustments to our business model, in order to partially mitigate our exposure to currency fluctuations.

Change in Non-Controlling Interest

On March 31, 2009, pursuant to a conversion agreement, an investor elected to convert a 30.0% interest in our Singapore operations into 493,828 shares of our Series C Redeemable Convertible Preferred Stock. Concurrently, we repurchased the same investor’s 40.0% interest in our Australia operations for $40.0 million in cash. In addition, on March 31, 2009, we acquired an additional 9.8% interest in one of our subsidiaries, decreasing the holdings of the non-controlling stockholder in that subsidiary to 39.2%.

Results of Operations

The following table sets forth our consolidated statements of operations for the three months ended March 31, 2010 and 2011:


	Three Months Ended March 31,						2010 Compared to 2011
	2010			2011			Variance			%
	(Unaudited)
	(In thousands, except percentages)

Consolidated Statements of Operations Data:
Revenue	$	767,377		$	1,267,874		$	500,497			65.2	%
Cost of revenue		682,678			1,157,310			474,632			69.5	%

Gross profit		84,699			110, 564			25,865			30.5	%

Operating expenses:
Selling, general and administrative		46,788			65,278			18,490			39.5	%
Provision for bad debts		9,462			(607	)		(10,069	)			*
Depreciation and amortization		2,611			3,389			778			29.8	%
Public offering expenses		5,400			—			(5,400	)			*

Total operating expenses		64,261			68,060			3,799			5.9	%

Operating income		20,438			42,504			22,066			108.0	%

Other income (expenses):
Interest income		1,826			1,460			(366	)		(20.0	)%
Interest expense		(5,798	)		(13,858	)		(8,060	)		139.0	%
Other income (expenses), net		8			1,805			1,797				*
Foreign exchange losses, net		(17,237	)		(2,486	)		14,751			(85.6	)%

Total other expenses		(21,201	)		(13,079	)		8,122			(38.3	)%

(Loss) income from continuing operations before provision for income taxes		(763	)		29,425			30,188				*
Provision for income taxes		3,337			10,755			7,418			222.3	%

(Loss) income from continuing operations		(4,100	)		18,670			22,770				*
(Loss) income from discontinued operations, net of taxes		(9	)		(32	)		(23	)		255.6	%

Net (loss) income		(4,109	)		18,638			22,747				*
Less: Net income attributable to non-controlling interest		331			965			634			191.5	%

Net (loss) income attributable to Brightstar Corp.	$	(4,440	)	$	17,673		$	22,113				*


*		Percentage change not meaningful

The following table sets forth our consolidated statements of operations for the years ended December 31, 2008, 2009 and 2010:


	Year Ended December 31,									2008 Compared to 2009						2009 Compared to 2010
	2008			2009			2010			Variance			%			Variance			%
	(In thousands, except percentages)

Consolidated Statement of Operations Data:
Revenue	$	3,550,165		$	2,718,652		$	4,612,863		$	(831,513	)		(23.4	)%	$	1,894,211			69.7	%
Cost of revenue		3,254,167			2,354,016			4,218,979			(900,151	)		(27.7	)%		1,864,963			79.2	%

Gross profit		295,998			364,636			393,884			68,638			23.2	%		29,248			8.0	%

Operating expenses:
Selling, general and administrative		174,287			161,806			235,239			(12,481	)		(7.2	)%		73,433			45.4	%
Provision for bad debts		2,736			6,435			8,785			3,699			135.2	%		2,350			36.5	%
Depreciation and amortization		9,917			13,457			11,913			3,540			35.7	%		(1,544	)		(11.5	)%
Public offering expenses		—			—			7,333			—			*			7,333			*

Total operating expenses		186,940			181,698			263,270			(5,242	)		(2.8	)%		81,572			44.9	%

Operating income		109,058			182,938			130,614			73,880			67.7	%		(52,324	)		(28.6	)%

Other income (expenses):
Interest income		14,206			21,278			7,139			7,072			49.8	%		(14,139	)		(66.4	)%
Interest expense		(34,746	)		(17,102	)		(29,025	)		17,644			(50.8	)%		(11,923	)		69.7	%
Other income (expenses), net		(923	)		(3,459	)		2,159			(2,536	)		274.8	%		5,618			*
Foreign exchange losses, net		(25,117	)		(80,915	)		(33,263	)		(55,798	)		222.2	%		47,652			(58.9	)%

Total other expenses		(46,580	)		(80,198	)		(52,990	)		(33,618	)		72.2	%		27,208			(33.9	)%

Income from continuing operations before provision for income taxes		62,478			102,740			77,624			40,262			64.4	%		(25,116	)		(24.4	)%
Provision for income taxes		35,402			46,999			36,938			11,597			32.8	%		(10,061	)		(21.4	)%

Income from continuing operations		27,076			55,741			40,686			28,665			105.9	%		(15,055	)		(27.0	)%
(Loss) income from discontinued operations, net of taxes		(14,304	)		2,595			(921	)		16,899			*			(3,516	)		*

Net income		12,772			58,336			39,765			45,564			356.7	%		(18,571	)		(31.8	)%
Less: Net income attributable to non-controlling interest		18,107			4,095			2,385			(14,012	)		(77.4	)%		(1,710	)		(41.8	)%

Net (loss) income attributable to Brightstar Corp.	$	(5,335	)	$	54,241		$	37,380		$	59,576			*		$	(16,861	)		(31.1	)%


*		Percentage change not meaningful.

Regional Highlights

The following table sets forth our regional data for the years ended December 31, 2008, 2009 and 2010 and the three months ended March 31, 2010 and 2011:


										Three Months Ended
	Year Ended December 31,									March 31,
	2008			2009			2010			2010			2011
										(Unaudited)
	(In thousands, except percentages)

U.S./Canada:
Revenue	$	650,611		$	724,161		$	1,472,593		$	224,123		$	285,017
Gross profit		44,752			58,769			85,350			15,522			23,665
Gross margin		6.9	%		8.1	%		5.8	%		6.9	%		8.3	%
Operating income		16,050			26,504			31,438			4,317			7,900
Latin America(1):
Revenue	$	2,700,279		$	1,733,522		$	2,749,695		$	468,806		$	806,768
Gross profit		174,284			140,014			197,635			38,693			61,846
Gross margin		6.5	%		8.1	%		7.2	%		8.3	%		7.7	%
Operating income		56,486			38,383			63,665			4,817			28,110
Asia Pacific:
Revenue	$	199,275		$	175,373		$	367,185		$	61,152		$	175,746
Gross profit		76,962			80,257			92,360			18,223			25,759
Gross margin		38.6	%		45.8	%		25.2	%		29.8	%		14.7	%
Operating income		37,083			35,455			39,662			7,602			8,345
Unallocated Corporate & Other:
Revenue	$	—		$	—		$	1,181		$	300		$	343
Gross profit		—			—			(3,670	)		(735	)		(706	)
Operating income		(561	)		(3,000	)		(26,360	)		(9,294	)		(1,851	)
Consolidated Total(2):
Revenue	$	3,550,165		$	2,718,652		$	4,612,863		$	767,377		$	1,267,874
Gross profit		295,998			364,636			393,884			84,699			110,564
Gross margin		8.3	%		13.4	%		8.5	%		11.0	%		8.7	%
Operating income		109,058			182,938			130,614			20,438			42,504


(1)		Excludes the effect of the Venezuela increase in revenue in 2009 and early 2010 related to specific transactions executed through the parallel market. See “— Significant Issues Affecting Comparability from Period to Period—Venezuela Business.”


(2)		Includes the effect of the Venezuela increase in revenue in 2009 and early 2010 related to specific transactions executed through the parallel market and the corresponding impact on gross profit, gross margin and operating income.

Segment Reporting Reconciliation

As discussed in Note 17, “Segment Reporting,” to our consolidated financial statements located elsewhere in this prospectus and “ — Significant Issues Affecting Comparability from Period to Period — Venezuela Business,” we entered into transactions that were settled in a parallel market active in 2009 and early 2010 in Venezuela, all of which were translated into U.S. dollars using the Official Rate of Venezuela. As a result, our consolidated results of operations reflect higher gross margins in 2009 and early 2010 than comparable periods, the effect of which was partially offset by foreign exchange losses. For management and segment reporting purposes, we classify the foreign exchange loss on these transactions as a reduction in revenue, which we believe provides a more comparable measure of revenue, gross profit, gross margins and operating income on a segment basis. We believe this approach is the most consistent with the underlying economics of these

transactions and provides the most meaningful measures to assess the results of operations and business trends in our Latin America region. As a result of the foregoing, our revenue, gross profit, gross margin and operating income included in our consolidated results of operations will differ from the aggregate revenue, gross profit and operating income for our regions, as follows.


							Three Months Ended
	Year Ended December 31,						March 31,
	2008		2009		2010		2010		2011
							(Unaudited)
	(In thousands)

U.S./Canada region	$	650,611	$	724,161	$	1,472,593	$	224,123	$	285,017
Latin America region		2,700,279		1,733,522		2,749,695		468,806		806,768
Asia Pacific region		199,275		175,373		367,185		61,152		175,746
Corporate and other		—		—		1,181		300		343

Region total		3,550,165		2,633,056		4,590,654		754,381		1,267,874
Effect of foreign exchange loss from Venezuela(1)		—		85,596		22,209		12,996		—

Consolidated total	$	3,550,165	$	2,718,652	$	4,612,863	$	767,377	$	1,267,874


(1)		See “ — Significant Issues Affecting Comparability from Period to Period — Venezuela Business.”

Three Months Ended March 31, 2011 Compared to Three Months Ended March 31, 2010

Revenue

Consolidated revenue increased 65.2% from $0.8 billion in the three months ended March 31, 2010 to $1.3 billion in the three months ended March 31, 2011 driven by strong revenue growth in all regions.

Revenue by Region


	Three Months Ended
	March 31,
	2010		2011		Variance			%
	(Unaudited)
	(In thousands, except percentages)

U.S./Canada region	$	224,123	$	285,017	$	60,894			27.2	%
Latin America region		468,806		806,768		337,962			72.1	%
Asia Pacific region		61,152		175,746		114,594			187.4	%
Corporate and other		300		343		43			14.3	%

Region total		754,381		1,267,874		513,493			68.1	%
Effect of foreign exchange loss from Venezuela(1)		12,996		—		(12,996	)			*

Consolidated total	$	767,377	$	1,267,874	$	500,497			65.2	%


*		Percentage change not meaningful.


(1)		See “— Significant Issues Affecting Comparability from Period to Period — Venezuela Business.”

Revenue in our U.S./Canada region increased 27.2% from $224.1 million in the three months ended March 31, 2010 compared to $285.0 million in the three months ended March 31, 2011, primarily as a result of incremental value-added distribution services driven by retailers’ launch of incremental stores and a new product segment launch within the retail channel.

Revenue in our Latin America region increased by 72.1% from $468.8 million in the three months ended March 31, 2010 to $806.8 million in the three months ended March 31, 2011, primarily as a result of increased activity in our assembly facility in Tierra del Fuego, Argentina due to a ramp up of manufacturing driven by favorable tax law changes, as well as strong growth of our value-added distribution services in Mexico.

Revenue in our Asia Pacific region increased 187.4% from $61.2 million in the three months ended March 31, 2010 to $175.7 million in the three months ended March 31, 2011, primarily as a result of our expansion into new countries in this region, including Vietnam and South Africa, and the high growth of our value-added distribution services, which was particularly strong in Turkey and Malaysia.

Gross Profit

Consolidated gross profit increased 30.5% from $84.7 million in the three months ended March 31, 2010 to $110.6 million in the three months ended March 31, 2011, driven by an increase in consolidated revenue, partly offset by the effect of the Venezuela foreign currency related increase in revenue in the three months ended March 31, 2010. See “— Significant Issues Affecting Comparability from Period to Period — Venezuela Business.” The increase in consolidated revenue was offset by a decrease in consolidated gross margin. Consolidated Adjusted gross profit increased by 54.2% from $71.7 million in the three months ended March 31, 2010 to $110.6 million in the three months ended March 31, 2011, driven by an increase in consolidated revenue, offset by lower margins as a result of the relative higher growth of our value-added distribution services compared to our other services in this period. For a reconciliation of Adjusted gross profit to gross profit, see Note (3) in “Prospectus Summary — Summary Consolidated Financial and Other Data.” Our Adjusted consolidated gross margin was 9.3% in the three months ended March 31, 2010 and 8.7% in the three months ended March 31, 2011.

Gross Profit by Region


	Three Months Ended March 31,
	2010 Gross			2010 Gross			2011 Gross			2011 Gross
	Profit			Margin			Profit			Margin			Variance			%
				(Unaudited)
	(In thousands, except percentages)

U.S./Canada region	$	15,522			6.9	%	$	23,665			8.3	%	$	8,143			52.5	%
Latin America region		38,693			8.3	%		61,846			7.7	%		23,153			59.8	%
Asia Pacific region		18,223			29.8	%		25,759			14.7	%		7,536			41.4	%
Corporate and other		(735	)			*		(706	)			*		29				*

Region totals		71,703			9.5	%		110,564			8.7	%		38,861			54.2	%
Effect of foreign exchange loss from Venezuela		12,996				*		—				*		(12,996	)			*

Consolidated total		84,699			11.0	%		110,564			8.7	%		25,865			30.5	%
Effect of foreign exchange loss from Venezuela		(12,996	)			*		—				*		12,996				*

Adjusted gross profit	$	71,703			9.3	%	$	110,564			8.7	%	$	38,861			54.2	%


*		Percentage change not meaningful.

U.S./Canada region gross profit increased 52.5% from $15.5 million in the three months ended March 31, 2010 to $23.7 million in the three months ended March 31, 2011, primarily as a result of increased revenue and gross margin. U.S./Canada gross margin increased from 6.9% in the three months ended March 31, 2010 to 8.3% in the three months ended March 31, 2011 primarily due to

recoveries of certain reserves recorded in late 2010 and, to a lesser extent, due to sales to certain retailers at higher margins.

Latin America region gross profit increased 59.8% from $38.7 million in the three months ended March 31, 2010 to $61.8 million in the three months ended March 31, 2011, primarily as a result of strong revenue growth. Latin America gross margin decreased from 8.3% in the three months ended March 31, 2010 to 7.7% in the three months ended March 31, 2011, primarily as a result of our value-added distribution services growing at a rate faster than our other services with historically higher margins.

Asia Pacific region gross profit increased 41.4% from $18.2 million in the three months ended March 31, 2010 to $25.8 million in the three months ended March 31, 2011, driven primarily by increased revenue, partially offset by decreased gross margin. Asia Pacific gross margin decreased from 29.8% in the three months ended March 31, 2010 to 14.7% in the three months ended March 31, 2011, driven primarily by a significant increase in revenue derived from value-added distribution services, which has a lower margin relative to the historically higher margins derived from our other services in the Asia Pacific region. We expect the gross margin for the Asia Pacific region will decrease as revenue from our value-added distribution services continues to grow at a rate faster than revenue from our other services throughout the region.

Selling, General and Administrative

Consolidated selling, general and administrative expenses increased 39.5% from $46.8 million in the three months ended March 31, 2010 to $65.3 million in the three months ended March 31, 2011, primarily as a result of the costs of increased staffing to support our growth, including payroll, benefits and training. This increase was primarily due to the growth of certain subsidiaries, particularly in the U.S., Tierra del Fuego and the Asia Pacific region, all of which experienced significant year-over-year growth.

Consolidated selling, general and administrative expenses as a percentage of revenue decreased from 6.1% of consolidated revenue in the three months ended March 31, 2010 to 5.1% in the three months ended March 31, 2011. This decrease was driven by our improved leverage of fixed and discretionary selling, general and administrative expenses over a higher revenue base.

We expect selling, general and administrative expenses to increase as we expand our business. However, to the extent that our revenue grows, we expect our selling, general and administrative as a percentage of revenue to decrease as we continue to leverage our fixed and discretionary selling, general and administrative expenses over a higher revenue base.

Selling, General and Administrative by Region


	Three Months Ended
	March 31,
	2010		2011		Variance		%
	(Unaudited)
	(In thousands, except percentages)

U.S./Canada region	$	8,524	$	11,135	$	2,611		30.6	%
Latin America region		20,419		23,936		3,517		17.2	%
Asia Pacific region		7,521		12,748		5,227		69.5	%
Corporate and other		10,324		17,459		7,135		69.1	%

Consolidated totals	$	46,788	$	65,278	$	18,490		39.5	%

Selling, general and administrative expenses in our U.S./Canada region increased 30.6% from $8.5 million in the three months ended March 31, 2010 to $11.1 million in the three months ended March 31, 2011, primarily as a result of increased staffing to support business growth. U.S./Canada region selling, general and administrative expenses as a percentage of revenue remained relatively flat at 3.8% of region revenue in the three months ended March 31, 2010 compared to 3.9% in the three months ended March 31, 2011.

Selling, general and administrative expenses in our Latin America region increased 17.2% from $20.4 million in the three months ended March 31, 2010 to $23.9 million in the three months ended March 31, 2011, primarily as a result of increased staffing to support business growth, particularly in our Tierra del Fuego subsidiary. As a percentage of region revenue, Latin America region selling, general and administrative expenses decreased from 4.4% in the three months ended March 31, 2010 to 3.0% in the three months ended March 31, 2011 due to improved leveraging of fixed and discretionary selling, general and administrative expenses.

Selling, general and administrative expenses in our Asia Pacific region increased 69.5% from $7.5 million in the three months ended March 31, 2010 to $12.7 million in the three months ended March 31, 2011, primarily as a result of increased staffing to support business growth in existing markets (particularly in Turkey) and geographic expansion. Asia Pacific region selling, general and administrative expenses as a percentage of revenue decreased from 12.3% of region revenue in the three months ended March 31, 2010 to 7.3% in the three months ended March 31, 2011 mainly as a result of the impact of our value-added distribution services growing faster than our other services.

Corporate and other general and administrative expenses increased 69.1% from $10.3 million in the three months ended March 31, 2010 to $17.5 million in the three months ended March 31, 2011. The increase in 2011 was driven primarily by costs of increased staffing, professional fees and travel to support business growth, as well as acquisition costs in the three months ended March 31, 2011. Corporate and other selling, general and administrative expenses were allocated to our regions, based on a combination of factors, including revenue and earnings, as follows:


	Three Months Ended
	March 31,
	2010		2011		Variance			%
	(Unaudited)
	(In thousands, except percentages)

U.S./Canada region	$	1,740	$	3,053	$	1,313			75.5	%
Latin America region		3,057		9,494		6,437			210.6	%
Asia Pacific region		2,368		3,830		1,462			61.7	%
Unallocated Corporate and other(a)		3,159		1,082		(2,077	)		(65.7	)%

Corporate and Other Selling, General and Administrative Expenses	$	10,324	$	17,459	$	7,135			69.1	%


(a)		Unallocated Corporate and other expenses in the three months ended March 31, 2010 consisted primarily of investments in our global supply chain services organization, including payroll, consulting and travel costs. In the three months ended March 31, 2011 they consisted primarily of acquisition costs.

Provision for Bad Debts

Our consolidated provision for bad debts decreased from $9.5 million in the three months ended March 31, 2010 to $(0.6) million in the three months ended March 31, 2011. This decrease is primarily attributable to a $7.5 million provision recorded against sales made to a distributor in Mexico in the three months ended March 31, 2010 due to the distributor’s financial condition. No additional sales have been made to the distributor since April 2010. We recovered a portion of this provision in the

three months ended March 31, 2011, and we continue to pursue recoverability of the remaining receivables based on guarantees and collateral pledges that we hold. There is no guarantee, however, that we will recover on all of our claims.

As a percentage of consolidated revenue, our consolidated provision for bad debts was less than 1.25% in the three months ended March 31, 2010, and we recorded a benefit in the three months ended March 31, 2011 due to the recovery against the Mexican distributor.

Provision for Bad Debts by Region


	Three Months Ended
	March 31,
	2010			2011			Variance			%
	(Unaudited)
	(In thousands, except percentages)

U.S./Canada region	$	304		$	540		$	236			77.6	%
Latin America region		9,162			(1,194	)		(10,356	)			*
Asia Pacific region		(4	)		15			19			475.0	%
Corporate and other		—			32			32				*

Consolidated total	$	9,462		$	(607	)	$	(10,069	)			*


*		Percentage change not meaningful.

Depreciation and Amortization

Consolidated depreciation and amortization expense increased 29.8% from $2.6 million in the three months ended March 31, 2010 to $3.4 million in the three months ended March 31, 2011, principally as a result of increased plant and robotic equipment due to our continued growth. Depreciation and amortization expense is consistent as a percentage of revenue at 0.3% for both periods.

Depreciation and Amortization by Region


	Three Months Ended
	March 31,
	2010		2011		Variance		%
	(Unaudited)
	(In thousands, except percentages)

U.S./Canada region	$	637	$	1,037	$	400		62.8	%
Latin America region		1,238		1,500		262		21.2	%
Asia Pacific region		736		821		85		11.5	%
Corporate and other		—		31		31			*

Consolidated total	$	2,611	$	3,389	$	778		29.8	%


*		Percentage change not meaningful.

Public Offering Expenses

During the three months ending March 31, 2010, we incurred certain expenses in preparation for our initial public offering.

Operating Income

For the reasons described above, and including the impact of parallel market transactions in Venezuela in the three months ended March 31, 2010, which increased our revenue, consolidated operating income increased 108.0% from $20.4 million in the three months ended March 31, 2010 to $42.5 million in the three months ended March 31, 2011. Excluding these effects amounting to $13.0 million in the three months ended March 31, 2010, operating income would have been $7.4 million and $42.5 million in the three months ended March 31, 2010 and 2011, respectively.

Operating Income by Region


	Three Months Ended
	March 31,
	2010			2011			Variance			%
	(Unaudited)
	(In thousands, except percentages)

U.S./Canada region	$	4,317		$	7,900		$	3,583			83.0	%
Latin America region		4,817			28,110			23,293			483.6	%
Asia Pacific region		7,602			8,345			743			9.8	%
Corporate and other		(9,294	)		(1,851	)		7,443				*

Region total		7,442			42,504			35,062			471.1	%
Effect of foreign currency loss from Venezuela		12,996			—			(12,996	)			*

Consolidated total	$	20,438		$	42,504		$	22,066			108.0	%


*		Percentage change not meaningful.

Operating income in the three months ended March 31, 2011 increased in all regions compared to the three months ended March 31, 2010 primarily as a result of increased gross profit driven by increased revenue, increased gross margin in our U.S./Canada region offset by lower gross margins in our Latin American and Asia Pacific regions, and higher selling, general and administrative expenses.

Operating income for our U.S./Canada region increased 83.0% from $4.3 million in the three months ended March 31, 2010 to $7.9 million in the three months ended March 31, 2011.

Operating income for our Latin America region increased over 100% from $4.8 million in the three months ended March 31, 2010 to $28.1 million in the three months ended March 31, 2011. In addition to the increased gross profit driven by increased revenue offset by lower gross margins, and higher selling, general and administrative expense drivers noted above operating income was positively affected by a significant decrease in the region’s provision for bad debts in the three months ended March 31, 2011 compared to the three months ended March 31, 2010.

Operating income for our Asia Pacific region increased 9.8% from $7.6 million in the three months ended March 31, 2010 to $8.3 million in the three months ended March 31, 2011.

Interest Income

Consolidated interest income is generated primarily from cash deposits, principally located outside of the United States, and decreased from $1.8 million in the three months ended March 31, 2010 to $1.5 million in the three months ended March 31, 2011. This decrease was attributable primarily to a decrease of interest bearing deposits in Venezuela from cash provided by several major customers as guarantee. Such deposits were returned as accounts receivable were collected.

Interest Expense

Interest expense increased from $5.8 million in the three months ended March 31, 2010 to $13.9 million in the three months ended March 31, 2011, primarily as a result of increased borrowings to fund working capital and investing requirements, as well as the issuance of $250.0 million of our 2016 Notes during the fourth quarter of 2010.

Other Income (Expenses), Net

Other income (expenses), net increased from income of $8 thousand in the three months ended March 31, 2010 to income of $1.8 million in the three months ended March 31, 2011, primarily as a result of higher earnings in the three months ended March 31, 2011 for Brightstar Europe, which we account for under the equity method, with our share of income increasing from $0.8 million in the three months ended March 31, 2010 to $2.8 million in the three months ended March 31, 2011.

Foreign Exchange Losses, Net

Our net foreign exchange loss, net decreased from $17.2 million in the three months ended March 31, 2010 to $2.5 million in the three months ended March 31, 2011, primarily as a result of the decrease in parallel market transactions in Venezuela.

Provision for Income Taxes

Our provision for income taxes increased from $3.3 million in the three months ended March 31, 2010 to $10.8 million in the three months ended March 31, 2011, representing effective tax rates of over 100% for the three months ended March 31, 2010 and 36.6% for the three months ended March 31, 2011. The effective income tax rate in the three months ended March 31, 2010 differed from the statutory federal tax rate of 35% primarily due to (a) a non-tax deductible book hyperinflationary currency deduction, and (b) changes in the foreign exchange rates used in the calculation of the underlying foreign tax credits’ effective rate, which related to a deferred tax liability recorded on the undistributed earnings of our major Australia Subsidiary that are not considered to be permanently reinvested. We are currently reviewing different strategies which we believe could positively impact our business results, including an effective tax rate approximating the statutory federal tax rate as was the case in the three months ended March 31, 2011.

Income taxes are provided based upon our anticipated underlying annual effective federal, state and foreign income tax rates, adjusted, as necessary, for any other tax matters occurring during the period. As we operate in various tax jurisdictions, our effective tax rate is also dependent upon our geographic earnings mix. See Note 12, “Income Taxes,” to our consolidated financial statements included elsewhere in this prospectus.

(Loss) Income from Continuing Operations

For the reasons described above, (loss) income from continuing operations increased from a loss of $4.1 million in the three months ended March 31, 2010 to income of $18.7 million in the three months ended March 31, 2011.

(Loss) Income from Discontinued Operations, Net of Taxes

(Loss) income from discontinued operations increased from income of $9 thousand in the three months ended March 31, 2010 to income of $32 thousand in the three months ended March 31, 2011.

Non-Controlling Interest

Consolidated non-controlling interests increased from $0.3 million in the three months ended March 31, 2010 to $1.0 million in the three months ended March 31, 2011, primarily as a result of increased earnings in a majority owned subsidiary.

Year Ended December 31, 2010 Compared to Year Ended December 31, 2009

Revenue

Consolidated revenue increased 69.7% from $2.7 billion in 2009 to $4.6 billion in 2010 driven by strong revenue growth in all regions.

Revenue by Region


	Year Ended
	December 31,
	2009		2010		Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	724,161	$	1,472,593	$	748,432			103.4	%
Latin America region		1,733,522		2,749,695		1,016,173			58.6	%
Asia Pacific region		175,373		367,185		191,812			109.4	%
Corporate and other		—		1,181		1,181			*

Region total		2,633,056		4,590,654		1,957,598			74.4	%
Effect of foreign exchange loss from Venezuela(1)		85,596		22,209		(63,387	)		(74.1	)%

Consolidated total	$	2,718,652	$	4,612,863	$	1,894,211			69.7	%


*		Percentage change not meaningful.

(1)		See “—Significant Issues Affecting Comparability from Period to Period — Venezuela Business.”

Revenue in our U.S./Canada region increased 103.4% from $724.2 million in 2009 to $1.5 billion in 2010, primarily as a result of the growth of our value-added distribution services with new and existing customers and in particular by further penetration into the retail channel with significant sales to a new retailer.

Revenue in our Latin America region increased by 58.6% from $1.7 billion in 2009 to $2.7 billion in 2010, driven by increased demand generated as a result of the overall economic recovery, including increased demand driven by the recovery of local currencies relative to the U.S. dollar which makes wireless devices more affordable. Growth in our sales through our assembly facility in Tierra Del Fuego, Argentina, was particularly strong, as was the revenue growth in Mexico. Revenue in this region for the year ended December 31, 2010 was affected by an $11.0 million impairment charge of upfront fees related to the sale of information technology devices to one of our customers in Latin America, offset by $10.4 million in revenue related to a sale of software licenses to an unrelated party under a distribution and referral agreement with a supplier in Latin America. See Note 14 to our consolidated financial statements included elsewhere in this prospectus.

Revenue in our Asia Pacific region increased 109.4% from $175.4 million in 2009 to $367.2 million in 2010, primarily as a result of our expansion into new countries in this region and the high

growth of our value-added distribution services, which was particularly strong in Turkey, Malaysia and Hong Kong.

Gross Profit

Consolidated gross profit increased 8.0% from $364.6 million in 2009 to $393.9 million in 2010, driven by an increase in consolidated revenue which included the effect of the Venezuela foreign currency related increase in revenue. The impact was significantly lower in 2010 compared to 2009 due to the decrease in the volume of our parallel market transactions in Venezuela in 2010. See “ — Significant Issues Affecting Comparability from Period to Period — Venezuela Business.” The increase in consolidated revenue was offset by a decrease in consolidated gross margin. Consolidated Adjusted gross profit increased by 37.1% from $279.0 million in 2009 to $382.7 million in 2010, driven by an increase in consolidated revenue, offset by lower margins as a result of the relative higher growth of our value-added distribution services compared to our other services with historically higher margins in this period. For a reconciliation of Adjusted gross profit to gross profit, see Note (3) in “Prospectus Summary — Summary Consolidated Financial and Other Data.” Our Adjusted consolidated gross margin was 10.3% in 2009 and 8.3% in 2010.

Gross Profit by Region


	Year Ended December 31,
	2009 Gross			2009 Gross			2010 Gross			2010 Gross
	Profit			Margin			Profit			Margin			Variance			%
				(In thousands, except percentages)

U.S./Canada region		58,769			8.1	%		85,350			5.8	%		26,581			45.2	%
Latin America region		140,014			8.1	%		197,635			7.2	%		57,621			41.2	%
Asia Pacific region		80,257			45.8	%		92,360			25.2	%		12,103			15.1	%
Corporate and other		—			*			(3,670	)		*			(3,670	)		*

Region total		279,040			10.6	%		371,675			8.1	%		92,635			33.2	%
Effect of foreign exchange loss from Venezuela		85,596			*			22,209			*			(63,387	)		*

Consolidated total		364,636			13.4	%		393,884			8.5	%		29,248			8.0	%
Effect of foreign exchange loss from Venezuela		(85,596	)		*			(22,209	)		*			63,387			*
Impairment of upfront fee		—			*			11,005			*			11,005			*

Adjusted gross profit	$	279,040			10.3	%	$	382,680			8.3	%	$	103,640			37.1	%


*		Percentage change not meaningful.

U.S./Canada region gross profit increased 45.2% from $58.8 million in 2009 to $85.4 million in 2010, primarily as a result of increased revenue, partially offset by decreased gross margin. U.S./Canada gross margin decreased from 8.1% in 2009 to 5.8% in 2010 as a result of increased business with a retailer that yielded significant revenue but lower margins as compared to business with other customers. Additionally, gross margin was impacted by certain reserves booked in 2010, part of which we expect to recover in 2011.

Latin America region gross profit increased 41.2% from $140.0 million in 2009 to $197.6 million in 2010, primarily as a result of strong revenue growth. Latin America gross margin decreased from 8.1% in 2009 to 7.2% in 2010, primarily as a result of our value-added distribution services growing at a rate faster than our other services with historically higher margins, as well as due to the effect of the $11.0 million impairment charge of upfront fees in 2010. Our 2010 Adjusted gross margin in Latin America, which excludes the impact of the impairment charge of upfront fees, was 7.6%.

Asia Pacific region gross profit increased 15.1% from $80.3 million in 2009 to $92.4 million in 2010, driven primarily by increased revenue, partially offset by decreased gross margin. Asia Pacific gross margin decreased from 45.8% in 2009 to 25.2% in 2010, driven primarily by a significant increase in revenue derived from value-added distribution services, which carries a lower margin relative to the average margin derived from other services with historically higher margins in the Asia Pacific region. The gross margin decline was also driven by the normal lifecycle of certain revenue derived under gain sharing arrangements where gross margins decline over the life of the contract as the savings realized for our customers are achieved.

Selling, General and Administrative

Consolidated selling, general and administrative expenses increased 45.4% from $161.8 million in 2009 to $235.2 million in 2010, primarily as a result of the costs of increased staffing to support our growth, including payroll, benefits and training. This increase was primarily due to the growth of certain subsidiaries, particularly the U.S., Tierra del Fuego and Mexico subsidiaries, all of which experienced significant year-over-year growth. Additionally, we invested in our global supply chain services organization headquartered in Cambridge, Massachusetts which was formed in late 2009.

Consolidated selling, general and administrative expenses as a percent of revenue decreased from 6.0% of consolidated revenue in 2009 to 5.1% in 2010. This decrease was driven by our improved leverage of fixed and discretionary selling, general and administrative expenses over a higher revenue base.

Selling, General and Administrative by Region


	Year Ended December 31,
	2009		2010		Variance		%
	(In thousands, except percentages)

U.S./Canada region	$	23,268	$	38,885	$	15,617		67.1	%
Latin America region		69,551		99,696		30,145		43.3	%
Asia Pacific region		31,118		38,100		6,982		22.4	%
Corporate and other		37,869		58,558		20,689		54.6	%

Consolidated total	$	161,806	$	235,239	$	73,433		45.4	%

Selling, general and administrative expenses in our U.S./Canada region increased 67.1% from $23.3 million in 2009 to $38.9 million in 2010, primarily as a result of increased staffing to support business growth. U.S./Canada region selling, general and administrative expenses as a percentage of revenue decreased from 3.2% of region revenue in 2009 to 2.6% in 2010, primarily due to our increased sales and resulting operating leverage as we started to benefit from our investment in selling, general and administrative expenses which are being used to support higher revenues.

Selling, general and administrative expenses in our Latin America region increased 43.3% from $69.6 million in 2009 to $99.7 million in 2010, primarily as a result of increased staffing to support business growth, particularly in our Tierra del Fuego and Mexico subsidiaries. As a percentage of region revenue, Latin America region selling, general and administrative expenses as a percentage of revenue decreased from 4.0% in 2009 to 3.6% in 2010.

Selling, general and administrative expenses in our Asia Pacific region increased 22.4% from $31.1 million in 2009 to $38.1 million in 2010, primarily as a result of increased staffing to support business growth, particularly in Turkey. Asia Pacific region selling, general and administrative expenses as a percentage of revenue decreased from 17.7% of region revenue in 2009 to 10.4% in 2010, due to improved leveraging of fixed and discretionary selling, general and administrative expenses, but also as a result of the effect of our value-added distribution services growing faster than our other services.

Corporate and other general and administrative expenses increased 54.6% from $37.9 million in 2009 to $58.6 million in 2010. The increase in 2010 was driven primarily by costs of increased staffing, professional fees and travel to support business growth, as well as the investment in our global supply chain services organization headquartered in Cambridge, Massachusetts. Corporate and other selling, general and administrative expenses were allocated to our regions, based on a combination of factors, including revenue and earnings, as follows:


	Year Ended December 31,
	2009		2010		Variance		%
	(In thousands, except percentages)

U.S./Canada region	$	5,528	$	10,753	$	5,225		94.5	%
Latin America region		18,485		21,342		2,857		15.5	%
Asia Pacific region		10,856		11,390		534		4.9	%
Unallocated Corporate and other(a)		3,000		15,073		12,073		*

Corporate and other	$	37,869	$	58,558	$	20,689		54.6	%


*		Percentage change not meaningful.

(a)		Unallocated Corporate and other expenses in 2010 consisted primarily of investments in our global supply chain services organization, including payroll, consulting and travel costs.

Provision for Bad Debts

Our consolidated provision for bad debts increased from $6.4 million in 2009 to $8.8 million in 2010. This increase is attributable to a $7.5 million provision recorded against sales made to a distributor in Mexico in 2010 due to the distributor’s financial condition.

As a percentage of consolidated revenue, our consolidated provision for bad debts was less than 0.25% in 2009 and 2010.

Provision for Bad Debts by Region


	Year Ended December 31,
	2009		2010		Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	964	$	1,298	$	334			34.7	%
Latin America region		5,281		7,338		2,057			39.0	%
Asia Pacific region		190		19		(171	)		*
Corporate and other		—		130		130			*

Consolidated total	$	6,435	$	8,785	$	2,350			36.5	%


*		Percentage change not meaningful.

Depreciation and Amortization

Consolidated depreciation and amortization expense decreased 11.5% from $13.5 million in 2009 to $11.9 million in 2010, principally as a result of certain adjustments made to the depreciation lives resulting in accelerated depreciation recorded in Mexico in 2009, which did not recur in 2010. Depreciation and amortization expense is consistent as a percentage of revenue at less than 0.5% for both periods.

Depreciation and Amortization by Region


	Year Ended December 31,
	2009		2010		Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	2,505	$	2,976	$	471			18.8	%
Latin America region		8,314		5,594		(2,720	)		(32.7	)%
Asia Pacific region		2,638		3,189		551			20.9	%
Corporate and other		—		154		154			*

Consolidated total	$	13,457	$	11,913	$	(1,544	)		(11.5	)%


*		Percentage change not meaningful.

Public Offering Expenses

During 2010, we incurred certain expenses in preparation for our initial public offering.

Operating Income

For the reasons described above, and including the impact of parallel market transactions in Venezuela, which increase our revenue, consolidated operating income decreased 28.6% from $182.9 million in 2009 to $130.6 million in 2010. Excluding these effects amounting to $85.6 million in 2009 and $22.2 million in 2010, operating income was $97.3 million and $108.4 million in 2009 and 2010, respectively.

Operating Income by Region


	Year Ended December 31,
	2009			2010			Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	26,504		$	31,438		$	4,934			18.6	%
Latin America region		38,383			63,665			25,282			65.9	%
Asia Pacific region		35,455			39,662			4,207			11.9	%
Corporate and other		(3,000	)		(26,360	)		(23,360	)		*

Region total		97,342			108,405			11,063			11.4	%
Effect of foreign currency loss from Venezuela		85,596			22,209			(63,387	)		(74.1	)%

Consolidated total	$	182,938		$	130,614		$	(52,324	)		(28.6	)%


*		Percentage change not meaningful.

Operating income in all regions increased primarily as a result of increased gross profit driven by increased revenue offset by lower gross margins and higher selling, general and administrative expenses.

Operating income for our U.S./Canada region increased 18.6% from $26.5 million in 2009 to $31.4 million in 2010.

Operating income for our Latin America region increased 65.9% from $38.4 million in 2009 to $63.7 million in 2010. In addition to the revenue, gross margin and selling, general and administrative expense drivers, operating income was affected by an increase in the region’s provision for bad debts, offset by the decrease in depreciation and amortization.

Operating income for our Asia Pacific region increased 11.9% from $35.5 million in 2009 to $39.7 million in 2010.

Interest Income

Consolidated interest income is generated primarily from cash deposits, principally located outside of the United States, and decreased from $21.3 million in 2009 to $7.1 million in 2010. This decrease was attributable primarily to a decrease of interest bearing deposits in Venezuela from cash provided by several major customers as guarantee. Such deposits were returned as accounts receivable were collected.

Interest Expense

Interest expense increased from $17.1 million in 2009 to $29.0 million in 2010, primarily as a result of increased borrowings to fund working capital and investing requirements.

Other Income (Expenses), Net

Other income (expenses), net increased from an expense of $3.5 million in 2009 to income of $2.1 million in 2010, primarily as a result of a $3.7 million write-off of equity and cost method investments in 2009 and a $1.1 million write-off of certain equipment in connection with a contract termination in 2009, which did not recur in 2010. Additionally, increased other income resulted from higher earnings in 2010 for Brightstar Europe, which we account for under the equity method, with our share of income increasing from $1.8 million in 2009 to $2.4 million in 2010.

Foreign Exchange Losses, Net

Our net foreign exchange loss decreased from $80.9 million in 2009 to $33.3 million in 2010, primarily as a result of the decrease in parallel market transactions in Venezuela.

Provision for Income Taxes

Our provision for income taxes decreased from $47.0 million in 2009 to $36.9 million in 2010, representing effective tax rates of 45.7% for 2009 and 47.6% for 2010. The effective income tax rate differed from the statutory federal tax rate of 35% primarily due to (a) a non-tax deductible book hyperinflationary currency deduction, (b) an increase in the valuation allowance recorded for additional deferred tax assets and (c) changes in the foreign exchange rates used in the calculation of the underlying foreign tax credits’ effective rate, which related to a deemed foreign dividend of our Australian subsidiary that arose pursuant to a U.S. income tax election we made.

Income from Continuing Operations

For the reasons described above, income from continuing operations decreased 27.0% from $55.7 million in 2009 to $40.7 million in 2010.

(Loss) Income from Discontinued Operations, Net of Taxes

(Loss) income from discontinued operations decreased from income of $2.6 million in 2009 to a loss of $0.9 million in 2010.

Non-Controlling Interest

Consolidated earnings attributable to non-controlling interests decreased from $4.1 million in 2009 to $2.4 million in 2010, primarily as a result of the redemption of non-controlling interests in our Australian and Singapore operations on March 31, 2009.

Year Ended December 31, 2009 Compared to Year Ended December 31, 2008

Revenue

Consolidated revenue decreased 23.4% from $3.6 billion in 2008 to $2.7 billion in 2009, driven by adverse effects from global economic conditions in 2009 which impacted the demand for wireless devices globally. The decline was due to the market share decline of one of our manufacturer customers, which formerly made up a large portion of our revenue, particularly in Latin America. Partially offsetting these factors were the expansion of our business into new countries, such as Turkey, the addition of a significant new retail customer in the United States and new service contracts with customers in New Zealand and Hong Kong.

Revenue by Region


	Year Ended December 31,
	2008		2009		Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	650,611	$	724,161	$	73,550			11.3	%
Latin America region		2,700,279		1,733,521		(966,758	)		(35.8	)%
Asia Pacific region		199,275		175,373		(23,902	)		(12.0	)%

Region total		3,550,165		2,633,055		(917,110	)		(25.8	)%
Effect of foreign exchange loss from Venezuela		—		85,597		85,597			*

Consolidated total	$	3,550,165	$	2,718,652	$	(831,513	)		(23.4	)%


*		Percentage change not meaningful.

Revenue in our U.S./Canada region increased 11.3% from $650.6 million in 2008 to $724.2 million in 2009, primarily as a result of the addition of new retailer customers and the expansion of our business in the retail and dealer agent channels.

Revenue in our Latin America region decreased 35.8% from $2.7 billion in 2008 to $1.7 billion in 2009, driven primarily by the effects of global economic conditions and the market share decline of one of our manufacturer customers. We also lost value-added distribution services business with an operator that reduced our sales by $340.3 million year over year. In addition, the weakening of certain currencies in this region relative to the U.S. dollar further contributed to the decline in revenue as it made wireless devices less affordable to end users in this region. The increased sales of smartphones and other devices we added to our distribution portfolio partially mitigated these adverse effects.

Revenue in our Asia Pacific region decreased 12.0% from $199.3 million in 2008 to $175.4 million in 2009, primarily as a result of a decline in our value-added distribution services revenue in the region as we exited certain geographies which did not meet our return requirements, partially offset by our expansion into Turkey and the implementation of new service contracts with customers in New Zealand and Hong Kong.

Gross Profit

Consolidated gross profit increased 23.2% from $296.0 million in 2008 to $364.6 million in 2009, as the revenue from parallel market transactions in Venezuela in 2009 substantially increased margins

offsetting the effect of a 23.4% decrease in consolidated revenue. See “ — Significant Issues Affecting Comparability from Period to Period — Venezuela Business.” Consolidated Adjusted gross profit decreased by 5.7% from $296.0 million in 2008 to $279.0 million in 2009, primarily due to the decrease in our consolidated revenue, partially offset by increasing margins as a result of our value-added distribution services decreasing at a much higher rate relative to our other services during this period. For a reconciliation of Adjusted gross profit to gross profit, see Note (3) in “Prospectus Summary — Summary Consolidated Financial and Other Data.”

Gross Profit by Region


	Year Ended December 31,
	2008 Gross		2008 Gross			2009 Gross		2009 Gross			Gross Profit
	Profit		Margin			Profit		Margin			Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	44,752		6.9	%	$	58,769		8.1	%	$	14,017			31.3	%
Latin America region		174,284		6.5	%		140,014		8.1	%		(34,270	)		(19.7	)%
Asia Pacific region		76,962		38.6	%		80,257		45.8	%		3,295			4.3	%

Region total		295,998		8.3	%		279,040		10.6	%		(16,958	)		(5.7	)%
Effect of foreign exchange loss from Venezuela		—					85,596					85,596			*

Consolidated total	$	295,998		8.3	%	$	364,636		13.4	%	$	68,638			23.2	%


*		Percentage change not meaningful.

U.S./Canada region gross profit increased 31.3% from $44.8 million in 2008 to $58.8 million in 2009, primarily as a result of an increase in region revenue and an increase in region gross margin from 6.9% in 2008 to 8.1% in 2009. U.S./Canada region gross margin increased primarily as a result of a higher product mix of smartphones sales via certain retailers as well as growth of prepaid phones.

Latin America region gross profit decreased 19.7% from $174.3 million in 2008 to $140.0 million in 2009, primarily as a result of the decrease in Latin America region revenue. Latin America region gross margin increased from 6.5% in 2008 to 8.1% in 2009, driven primarily by a shift in sales from lower margin cell phones to higher margin smartphones, as well as a result of the decrease in the contribution of our value-added distribution services relative to our other services during this period.

Asia Pacific region gross profit increased 4.3% from $77.0 million in 2008 to $80.3 million in 2009, driven primarily by an increase in region gross margin from 38.6% in 2008 to 45.8% in 2009, partially offset by a decrease in region revenue. Asia Pacific gross margin increased in 2009 primarily due to the mix of services provided in the region.

Selling, General and Administrative

Consolidated selling, general and administrative expenses decreased 7.2% from $174.3 million in 2008 to $161.8 million in 2009, primarily as a result of decreases in variable expenses related to our response to decreased revenue resulting from the global economic conditions.

Consolidated selling, general and administrative expenses as a percent of revenue increased from 4.9% of consolidated revenue in 2008 to 6.0% in 2009, primarily as a result of the magnitude of the decrease in revenue being greater than the reduction in selling, general and administrative expenses.

Selling, General and Administrative by Region


	Year Ended December 31,
	2008		2009		Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	22,141	$	23,268	$	1,127			5.1	%
Latin America region		90,629		69,551		(21,078	)		(23.3	)%
Asia Pacific region		28,334		31,118		2,784			9.8	%
Corporate and other		33,183		37,869		4,686			14.1	%

Consolidated total	$	174,287	$	161,806	$	(12,481	)		(7.2	)%

Selling, general and administrative expenses in our U.S./Canada region increased 5.1% from $22.1 million in 2008 to $23.3 million in 2009, primarily as a result of increased selling, general and administrative expenses to support the growth in this region. U.S./Canada region selling, general and administrative expenses as a percent of revenue decreased from 3.4% of region revenue in 2008 to 3.2% in 2009, primarily due to greater leveraging of fixed and discretionary region selling, general and administrative expenses.

Selling, general and administrative expenses in our Latin America region decreased 23.3% from $90.6 million in 2008 to $69.6 million in 2009, primarily as a result of our efforts to adjust to the overall economic conditions and the resulting revenue reduction experienced in this region. Latin America region selling, general and administrative expenses as a percent of revenue increased from 3.4% of region revenue in 2008 to 4.0% in 2009, primarily as a result of the de-leveraging of the Latin America region selling, general and administrative cost structure in 2009 due to considerable decreased region revenue.

Selling, general and administrative expenses in our Asia Pacific region increased 9.8% from $28.3 million in 2008 to $31.1 million in 2009, primarily as a result of administrative costs associated with the implementation of new service contracts and geographic expansion in the region. Asia Pacific region selling, general and administrative expenses as a percent of revenue increased from 14.2% of region revenue in 2008 to 17.7% in 2009 in anticipation of continued expansion in this region.

Corporate and other selling, general and administrative expenses increased 14.1% from $33.2 million in 2008 to $37.9 million in 2009. The increase in 2009 was driven primarily by professional fees related to public company readiness activities. Corporate and other selling, general and administrative expenses were allocated to our regions based on a combination of factors, including revenue and earnings, as follows:


	Year Ended December 31,
	2008		2009		Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	4,659	$	5,528	$	869			18.7	%
Latin America region		19,176		18,485		(691	)		(3.6	)%
Asia Pacific region		9,348		10,856		1,508			16.1	%
Unallocated Corporate and other(a)		—		3,000		3,000			*

Corporate and other	$	33,183	$	37,869	$	4,686			14.1	%


*		Percentage change not meaningful.

(a)		Unallocated Corporate and other expenses in 2009 consisted of expenses incurred with our initiative of public company readiness, which are not allocated to our regions.

Provision for Bad Debts

Our consolidated provision for bad debts increased 135.2% from $2.7 million in 2008 to $6.4 million in 2009. As a percentage of consolidated revenue, our consolidated provision for bad debt was less than 0.25% in 2008 and 2009.

Provision for Bad Debts by Region


	Year Ended December 31,
	2008		2009		Variance		%
	(In thousands, except percentages)

U.S./Canada region	$	652	$	964	$	312		47.9	%
Latin America region		1,934		5,281		3,347		173.1	%
Asia Pacific region		150		190		40		26.7	%

Consolidated total	$	2,736	$	6,435	$	3,699		135.2	%

Depreciation and Amortization

Consolidated depreciation and amortization expense increased 35.7% from $9.9 million in 2008 to $13.5 million in 2009, driven primarily by leasehold improvements, computer equipment, software and furniture and fixtures placed in service for our new Miami headquarters location, which we commenced occupying in the second half of 2008, as well as certain adjustments made to the depreciation lives resulting in accelerated depreciation in Mexico.

Depreciation and Amortization by Region


	Year Ended December 31,
	2008		2009		Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	1,251	$	2,505	$	1,254			100.2	%
Latin America region		6,058		8,314		2,256			37.2	%
Asia Pacific region		2,047		2,638		591			28.9	%
Corporate and other		561		—		(561	)		(100.0	)%

Consolidated total	$	9,917	$	13,457	$	3,540			35.7	%

Operating Income

For the reasons described above, and including the impact of parallel market transactions in Venezuela, which increased our revenue, consolidated operating income increased 67.7% from $109.1 million in 2008 to $182.9 million in 2009. Excluding these effects amounting to $85.6 million in 2009, operating income was $109.1 million and $97.3 million in 2008 and 2009, respectively.

Operating Income by Region


	Year Ended December 31,
	2008			2009			Variance			%
	(In thousands, except percentages)

U.S./Canada region	$	16,049		$	26,504		$	10,455			65.1	%
Latin America region		56,487			38,383			(18,104	)		(32.1	)%
Asia Pacific region		37,083			35,455			(1,628	)		(4.4	)%
Corporate and other		(561	)		(3,000	)		(2,439	)		*

Region total		109,058			97,342			(11,716	)		(10.7	)%
Effect of foreign currency loss from Venezuela		—			85,596			85,596			*

Consolidated total	$	109,058		$	182,938		$	73,880			67.7	%


*		Percentage change not meaningful.

Operating income for our U.S./Canada region increased 65.1% from $16.1 million in 2008 to $26.5 million in 2009, primarily as a result of increased gross profit, driven by revenue increases and gross margin improvements, slightly offset by increased selling, general and administrative expenses to support growth in the region.

Operating income for our Latin America region decreased 32.1% from $56.5 million in 2008 to $38.4 million in 2009, driven by the decrease in the region’s revenue, partially offset by increased margins and decreased selling, general and administrative expenses.

Operating income for our Asia Pacific region decreased 4.4% from $37.1 million in 2008 to $35.5 million in 2009, driven primarily by a decrease in revenue, increases in selling, general and administration expense and depreciation expense, offset by an increase in gross margin.

Interest Income

Consolidated interest income is generated primarily from cash deposits and increased 49.8% from $14.2 million in 2008 to $21.3 million in 2009. This increase was attributable primarily to interest bearing deposits in Venezuela from cash provided by several major customers as guarantee for future accounts receivable collections, partially offset by a decrease in interest bearing time deposits following the use of cash to complete the redemption of non-controlling interests in Australia in March 2009.

Interest Expense

Interest expense decreased 50.8% from $34.7 million in 2008 to $17.1 million in 2009, primarily as a result of a reduction in total outstanding debt and a decrease in LIBOR.

Other Income (Expenses), Net

Other income (expenses), net decreased from an expense of $0.9 million in 2008 to an expense of $3.5 million in 2009, principally as a result of a $4.0 million gain realized on the sale of investments in 2008, which did not recur in 2009, a $3.7 million write-off of equity and cost method investments in 2009 and a $1.1 million write-off of certain equipment in connection with a contract termination in 2009. Partially offsetting these factors were improved earnings in 2009 for Brightstar Europe, which we account for under the equity method, and a $2.1 million impairment of our investment in Brightstar Europe recognized in 2008, which did not recur in 2009.

Foreign Exchange Losses, Net

Our net foreign exchange loss increased $55.8 million from $25.1 million in 2008 to $80.9 million in 2009, primarily as a result of the effect of the highly inflationary economy in Venezuela in 2009,

partially offset by net gains generated in 2009 by transactions denominated in other currencies, mainly in Brazil which experienced a recovery of the Brazilian real during 2009. See “— Significant Issues Affecting Comparability from Period to Period — Venezuela Business.”

Provision for Income Taxes

Our provision for income taxes increased from $35.4 million in 2008 to $47.0 million in 2009, representing effective tax rates of 56.7% in 2008 and 45.7% in 2009. The primary reason our effective tax rate exceeded the U.S. federal statutory rate in 2009 was the partial modification of our non-distribution policy in 2009, which we expect will be repatriated to the U.S. in the future. The 2009 provision for taxes includes a $6.2 million deferred tax charge relating to undistributed earnings in Australia. The primary reason our effective tax rate exceeded the U.S. federal statutory rate in 2008 was foreign operating losses that did not benefit our effective tax rate due to the establishment of valuation reserves against them. As we operate in various tax jurisdictions, our effective tax rate is also dependent upon our geographic earnings mix.

Income from Continuing Operations

For the reasons described above, income from continuing operations increased 105.9% from $27.1 million in 2008 to $55.7 million in 2009.

(Loss) Income from Discontinued Operations, Net of Taxes

(Loss) income from discontinued operations increased from a loss of $14.3 million in 2008 to income of $2.6 million in 2009, driven primarily by a subsidiary that was disposed of in 2009 following large operating losses in 2008 and the benefit of a $7.3 million insurance recovery in 2009 related to a disposed operation.

Non-Controlling Interest

Consolidated earnings attributable to non-controlling interests decreased from $18.1 million in 2008 to $4.1 million in 2009, primarily as a result of the redemption of non-controlling interests in our Australian and Singapore operations on March 31, 2009.

Quarterly Financial Data

The following table presents our unaudited condensed consolidated quarterly results of operations for the nine quarters ended March 31, 2011. This table includes all adjustments, consisting only of normal recurring adjustments that we consider necessary for fair presentations of our financial position and operating results for the quarters presented:


	Mar 31,			Jun 30,		Sep 30,			Dec 31,		Mar 31,			Jun 30,			Sep 30,			Dec 31,		Mar 31,
	2009			2009		2009			2009		2010			2010			2010			2010		2011
	(In thousands)
	(Unaudited)

Revenue(1)	$	625,132		$	598,505	$	646,122		$	848,893	$	767,377		$	1,049,794		$	1,136,315		$	1,659,377	$	1,267,874
Gross profit		60,316			87,624		120,976			95,720		84,699			94,424			97,207			117,554		110,564
Net income (loss) from continuing operations		6,130			25,265		18,442			5,904		(4,100	)		19,440			13,273			12,073		18,670
(Loss) income from discontinued operations, net of income taxes		(1,109	)		3,998		(294	)		—		(9	)		(532	)		(380	)		—		(32	)

Net income (loss)	$	5,021		$	29,263	$	18,148		$	5,904	$	(4,109	)	$	18,908		$	12,893		$	12,073	$	18,638


(1)		Sales of wireless devices are seasonal with demand normally being highest in the fourth quarter.

Liquidity and Capital Resources

Historically, we have had significant cash requirements as we expanded our business into new geographic and product markets. Our requirements for cash include the costs related to increased working capital, primarily accounts receivable and inventory, offset partially by accounts payable. Our

working capital needs are driven by the seasonality and growth of our business with our cash requirements being greater in periods of growth. Additional cash requirements resulting from our growth include the costs of additional personnel, production and distribution facilities, enhancing our information systems and, in the future, our integration of any acquisitions and our compliance with laws and rules applicable to being a public company.

Comparative Cash Flows


	Year Ended December 31,									Three Months Ended March 31,
	2008			2009			2010			2010			2011
										(Unaudited)
	(In thousands)

Cash and cash equivalents at end of period	$	122,057		$	239,859		$	159,161		$	131,799		$	102,541
Net cash provided by (used in) operating activities		229,866			248,201			(159,307	)		(111,289	)		(27,723	)
Net cash used in investing activities		(7,530	)		(84,338	)		(37,747	)		(20,549	)		(13,813	)
Net cash (used in) provided by financing activities		(194,583	)		(41,927	)		109,484			21,717			(20,247	)

Net Cash Provided by (Used in) Operating Activities

During the three months ended March 31, 2011, we used $27.7 million in net cash for operating activities, compared to $111.3 million of net cash used in operating activities in the three months ended March 31, 2010. The decrease in cash used in operating activities was primarily due to increased revenues related to business growth and improvements in our working capital requirements as a result of significant collections of accounts receivable, trade.

During the year ended December 31, 2010, we used $159.3 million in net cash for operating activities, compared to $248.2 million of net cash provided by operating activities in 2009. The $407.5 million decrease in cash provided by operating activities was primarily due to significant increases in working capital accounts driven by a 69.7% increase in revenues. Additionally, in 2010, our U.S./Canada region experienced a shift in sales to retail customers which have longer payment terms, resulting in a $283.9 million increase in gross trade receivables, and our Latin America region repaid $119.5 million in customer deposits and released $65.3 million in credit notes.

During the year ended December 31, 2009, we had $248.2 million in net cash provided by operating activities, compared to $229.9 million provided during the year ended December 31, 2008. The increase in cash provided by operating activities was primarily due to $119.5 million in deposits from a customer and $65.3 million in credit notes payable to a customer that were being held as collateral as of December 31, 2009.

Cash flows from discontinued operations, which are not material to the consolidated financial statements, are included in the consolidated statement of cash flows within operating, investing and financing activities. The absence of cash flows from discontinued operations in future filings are not expected to impact future liquidity or capital resources.

Historically, we have used cash as a result of increased working capital requirements driven by revenue growth. In the future, we will continue to adjust our growth and expansion plans based on our available working capital and market opportunities.

Net Cash Used in Investing Activities

Investing activities primarily reflect our equity and cost method investments, capital expenditures and proceeds from (or purchases of) short-term investments.

During the three months ended March 31, 2011, we used $13.8 million in net cash for investing activities, compared to $20.5 million during the three months ended March 31, 2010, reflecting an investment in office properties in Venezuela in 2010 of $27.8 million and an investment in a long-term note receivable in 2011 of $11.8 million.

During the year ended December 31, 2010, we used $37.7 million in net cash in investing activities, compared to net cash used in investing activities of $84.3 million during the year ended December 31, 2009, reflecting equity and cost method investments in 2009 and 2010 of $26.1 million and $32.8 million, respectively, and an investment in office properties in Venezuela in 2009 and 2010 of $13.8 million and $27.8 million, respectively.

During the year ended December 31, 2009, we used net cash of $84.3 million in our investing activities compared to $7.5 million in 2008.

Capital expenditures, typically required for leasehold improvements, computer equipment and software and furniture, fixtures and warehouse equipment used in our operations, were $9.3 million during 2008 compared to $6.4 million during 2009 and $15.5 million during 2010. The increase in 2010 was driven primarily by investments in the U.S. and at our assembly facility in Tierra del Fuego, Argentina, to support our business growth. Capital expenditures are expected to range from $25 million to $30 million in 2011, principally to fund investments in infrastructure and applications. Additional capital expenditures include information technology upgrades or other special initiatives.

Net Cash (Used in) Provided by Financing Activities

During the three months ended March 31, 2011, we used $20.2 million in net cash from financing activities, compared to $21.7 million in net cash provided during the three months ended March 31, 2010, reflecting net pay downs in 2011 of our working capital funding inclusive of borrowings for our investment requirements.

During the year ended December 31, 2010, we generated $109.5 million in net cash from financing activities, compared to net cash used in financing activities of $41.9 million during 2009, reflecting net borrowings of $72.7 million in 2010 to fund working capital and investment requirements, including the issuance of our $250.0 million senior subordinated notes in November 2010 and net repayments of $176.0 million under our ABL Revolver.

During the year ended December 31, 2009, net cash used in financing activities was $41.9 million, including $49.9 million, net used to repay outstanding indebtedness under our then existing revolving lines of credit and term loan, and $40.0 million used for the redemption of non-controlling interests in a subsidiary in the Asia Pacific region, partially offset by a decrease in restricted cash of $50.0 million.

During the year ended December 31, 2008, net cash used in financing activities was $194.6 million, including $127.9 million, net used to repay outstanding indebtedness under our then existing revolving lines of credit and term loan, an increase in restricted cash of $58.4 million and dividends of $5.4 million to our common stockholders.

Liquidity Overview

As of March 31, 2011, we have $102.5 million in unrestricted cash and cash equivalents.

As of December 31, 2010, we had $159.2 million in unrestricted cash and cash equivalents. With the exception of approximately $12.1 million, this amount is held outside of the U.S. As of December 31, 2009, we had $239.9 million in unrestricted cash and cash equivalents. With the exception of approximately $0.2 million, this amount is held outside of the U.S. As of December 31, 2009 and 2010, we consider all of our foreign subsidiary earnings to be indefinitely reinvested with the exception of our Australian subsidiary. However, since one of our U.S. subsidiaries serves primarily as

a purchasing agent for many of our foreign subsidiaries, we are able to collect a significant portion of this cash for general corporate use.

Additionally, as of December 31, 2010, we had a gross borrowing capacity of $559.8 million under various credit facilities, based on facility credit lines less usage and reserves for letters of credit.

On November 30, 2010, we issued an aggregate of $250.0 million of 9.50% senior notes due December 1, 2016.

On December 23, 2010, we amended and restated our ABL Revolver and increased the facility size by $100.0 million to a total facility size of $500.0 million with an option to increase it to $600.0 million on an uncommitted basis.

Historically, we have relied on available lines of revolving credit (and, to a lesser degree, factoring arrangements), cash from our operations and trade credit provided by our suppliers to finance our working capital requirements and to support our growth.

Our capital structure has consisted of redeemable convertible preferred stock, common stock and various debt instruments, including convertible subordinated senior notes. Accordingly, our cash requirements have included the payment of preferred dividends to redeemable convertible preferred stockholders and interest on our debt.

Our cash availability is dependent in part on our foreign subsidiaries’ ability to collect their receivables on a timely basis and may be negatively affected by local currency and conversion restrictions, such as those in Venezuela, and our ability to negotiate favorable payment terms with our suppliers. Given our current cash and cash equivalents, credit facilities and lines of credit, the proceeds from this offering and our ability to generate cash from operations, we believe we will be able to meet our anticipated cash requirements for at least the next twelve months.

In the event that the sources of cash described above are not sufficient to meet our future cash requirements, we will seek additional loans or reduce planned expenditures. If loans are not available on favorable terms, we may seek to raise funds through the issuance of additional bonds or equity securities. If such actions are not sufficient, we would intend to limit our growth and reduce or curtail some of our operations to levels consistent with the constraints imposed by our available cash flow. Our ability to seek additional debt or equity financing is limited by our existing indebtedness and may be further limited by any future financing arrangements or then current economic and financial conditions.

Indebtedness

The following table sets forth our existing debt as of March 31, 2011:


						Gross
Debt	Country	Total Size		Outstanding		Availability(a)
		(In millions)

Revolving credit facility	United States	$	500.0	$	53.9	$	334.3
Senior notes(b)	United States		250.0		250.0		—
Trade facilities	United States		50.0		—		50.0
Bank facilities — U.S. operations	United States		4.7		4.7		—
Bank facilities — foreign operations(b)	Various		200.5		141.7		50.3

Total		$	1,005.2	$	450.3	$	434.6


(a)		Gross availability is calculated based on total facility size less outstanding balance and reserves for letters of credit.


(b)		In May 2011, we issued an additional $100.0 million aggregate principal amount of 2016 Notes under the indenture dated November 30, 2010, pursuant to which we have previously issued $250.0 million aggregate principal amount of 2016 Notes.


(c)		Includes Argentina, Australia, Brazil, Dominican Republic, Malaysia, Mexico, Peru, Singapore, South Africa, Turkey and Vietnam bank facilities, but excludes United States bank facilities.

Revolving Credit Facility

As of December 31, 2010, we had a $500.0 million senior secured asset-based revolving credit facility with a syndicate of financial institutions as lenders, and PNC Bank, National Association (“PNC Bank”), as administrative agent. The borrowers are Brightstar Corp. and Brightstar US, Inc. and the ABL Revolver is guaranteed, jointly and severally, by our wholly owned existing and future domestic subsidiaries. The revolving facility funds working capital advances, letters of credit and general corporate purposes and is collateralized by the receivables, inventories, fixed assets and general intangibles of our U.S. subsidiaries and operations. The borrowing base consists primarily of 85% to 90% of eligible receivables plus 60% to 75% of eligible inventories. The facility was amended and restated on December 23, 2010, when we incorporated all executed amendments and included newly negotiated terms into one credit facility. The amendment increased the revolving credit facility to $500.0 million and included an option to increase it to $600.0 million on an uncommitted basis. The ABL Revolver was further amended on April 8, 2011 to provide flexibility in respect of certain covenants relating to loans and investments and also included a waiver to raise additional capital through a future potential notes offering.

The ABL Revolver bears interest at the domestic rate plus 1.00% to 1.50% or Eurodollar Rate/LIBOR plus 2.00% to 2.50% (as defined in the ABL Revolver), depending on the average availability. We are also required to pay an unused facility fee ranging from 0.375% to 0.50% per annum, depending on the average undrawn availability. As of December 31, 2010, the ABL Revolver’s weighted average interest rate was 2.70%, there was $83.7 million in outstanding letters of credit and the balance of the ABL Revolver was $0.0 million.

The ABL Revolver contains customary events of default and covenants that restrict, among other things, making investments, incurring additional indebtedness or making capital expenditures in excess of specified amounts, creating liens and engaging in certain mergers or combinations without the prior written consent of the lenders. Many of the negative covenants, including dividend payments and loans and investments to foreign subsidiaries, are subject to a Fixed Charge Coverage Ratio incurrence test and minimum undrawn availability target. The ABL Revolver does not contain financial maintenance covenants, as long as we exceed a minimum average undrawn availability ratio for the quarterly reporting period of 12.5%. If our undrawn availability is less than 12.5%, we are subject to a fixed charge coverage ratio of not less than 1.15x.

Senior Notes due 2016

In November 2010 and May 2011, we issued and sold $250.0 million and $100.0 million, respectively, aggregate principal amount of our 2016 Notes, which are designated as 9.5% Senior Notes due December 1, 2016. Interest is payable in cash on each of June 1 and December 1, beginning on June 1, 2011. Prior to December 1, 2014, we may redeem all or a portion of the 2016 Notes, plus accrued and unpaid interest, if any, to the redemption date, at a price of 100% of the principal amount thereof redeemed plus an applicable “make-whole” premium. On or after December 1, 2014 we may redeem all or a portion of the 2016 Notes, plus accrued and unpaid interest, if any, to the redemption date, at the prices set forth in the notes. In addition, prior to December 1, 2014, we may redeem up to 35% of the aggregate principal amount of the 2016 Notes at a redemption price of 109.5% of the principal amount thereof, plus accrued and unpaid interest, if any, to the redemption date, with the net cash proceeds of one or more equity offerings. As of May 15, 2011, $350.0 million of our 2016 Notes was outstanding.

The indenture governing the 2016 Notes contains certain covenants that, among other things, limit our ability to:


	•	incur additional debt;

	•	make certain payments, including dividends or other distributions, with respect to our capital stock, or prepayments of subordinated debt;

	•	make certain investments or sell assets;

	•	create certain liens or engage in sale and leaseback transactions;

	•	provide guarantees for certain debt;

	•	enter into restrictions on the payment of dividends and other amounts by subsidiaries;

	•	engage in certain transactions with affiliates;

	•	consolidate, merge or transfer all or substantially all our assets; and

	•	enter into other lines of business.

These covenants are subject to a number of important limitations and exceptions.

The 2016 Notes include customary events of default, including failure to pay principal and interest on the 2016 Notes, a failure to comply with covenants, a failure to pay material judgments or indebtedness and bankruptcy and insolvency events.

Trade Financing Facilities

Our U.S. trade financing facilities consist of a U.S. Bank facility, Export Development Canada facility, Sabadell Bank facility and bank promissory notes.

U.S. Bank

In October 2009, we renewed our trade facility with U.S. Bank and decreased our borrowing limit from $30.0 million to $20.0 million. This facility bears an interest rate of LIBOR plus 1.0% to 2.0% per annum with a maturity date of October 2010. The payment terms are up to 120 days from the disbursement date. The lines are secured by credit insurance policies and the cost of the credit insurance is paid by us. We also pay a quarterly undrawn facility fee of 0.25% per annum. As of December 31, 2009, the outstanding balance was $25.3 million and the interest rate ranged from 1.28% to 2.32%. In June 2010, we increased our borrowing limit from $20.0 million to $30.0 million. In October 2010, we renewed the facilities, extending the maturity date to October 2011. As of December 31, 2010, there was no outstanding balance.

Export Development Canada

In October 2008, we entered into a loan agreement with Export Development Canada which finances purchase of goods with a borrowing limit of $50.0 million. The loan is unsecured and matures annually and is automatically renewed unless either party notifies within 60 days of the maturity date. We most recently renewed in October 2010. We also pay a quarterly unused commitment fee of 0.50% per annum and an annual administration fee of 0.35% per annum at the maturity date and every anniversary thereafter. This agreement generally has payment terms of no more than 120 days from the date of disbursement and with a borrowing rate of LIBOR plus 1.5% per annum. As of December 31, 2009 and 2010, the outstanding balance was $50.0 million and $43.7 million, respectively, and the interest rate under this facility ranged from 1.75% to 1.80% and 1.75% to 2.03%, respectively. This facility was terminated in March 2011.

Sabadell Bank

In June 2010, we entered into a $5.0 million factoring agreement with a bank to finance vendor invoices which we amended in August 2010 to $20.0 million. The line bears interest at LIBOR plus 4.4% plus fees as stated in the agreement. The outstanding balance as of December 31, 2010 for this agreement amounted to $20.5 million and the interest rate under this agreement ranged from 4.69% to 4.94%.

Bank Promissory Notes

In April and May 2009, we issued two separate promissory notes with a bank to facilitate the financing of our account receivables to customers located in Venezuela. The promissory notes have no stated maturity dates and bear interest at LIBOR plus 1.0% which is paid by the customers. The capacity of the line is up to $30.0 million. The outstanding balance as of December 31, 2009 for these promissory notes amounted to $21.5 million. These promissory notes were repaid in October 2010.

Bank Facilities

As of December 31, 2009 and 2010, we had entered into various financing arrangements with local banks at some of our subsidiaries, primarily consisting of factoring agreements, revolving lines of credit, trade facilities, term loans and capital leases. The terms of the credit facilities range from 12 months to 30 months and are guaranteed with the pledge of local Brightstar assets and/or with a corporate guarantee. As to capital leases, each individual lease is evaluated and accounted for in accordance with its merits as a capital or operating lease. Payments are made in accordance with the given bank’s amortization schedules. The term of the capital lease agreements generally range between 36 months to 60 months from the commencement date.

As of December 31, 2009 and 2010, we had foreign operations bank facilities outstanding of $41.8 million and $134.5 million, respectively. These facilities bear interest at the agreement’s stated interest rate, predominantly LIBOR, plus a margin of 0.35% to 5.50%. These interest rates ranged from 1.0% to 10.5% and 1.0% to 13.7% per annum in 2009 and 2010, respectively. Additionally, some facilities bear fees related to unused availability, commitment amounts or other basis, as stated in the agreement, these range from 0.05% to 0.50% and are generally paid annually.

Capital Leases

During 2006, we entered into a master lease agreement with a bank for the purpose of financing certain purchases of equipment and services for up to $12.0 million. At the inception, each individual lease is evaluated and accounted for in accordance with its merits as a capital or operating lease. Payments are made in accordance with the bank’s amortization schedules. The terms of the lease agreements generally range between 36 months to 60 months from the commencement date. We also have lease-financing arrangements with other third parties. As of December 31, 2009 and 2010, we had $8.7 million and $5.1 million outstanding, respectively.

Interest Rate Swap Agreements

In 2008, we entered into interest rate swap agreements for an aggregate notional amount of $100.0 million with an average fixed interest rate of 2.1%. The interest rate swap agreements serve as an economic hedge against increases in variable interest rates but have not been designated as hedges for accounting purposes. Accordingly, we account for these interest rate swap agreements on a fair value basis and adjust the carrying amounts of these instruments to fair value with changes in fair value reflected as a component of interest expenses in our consolidated statements of operations.

In November 2009, an interest rate swap with a notional amount of $20.0 million matured and was not renewed. As a result, the notional amount outstanding was $80.0 million as of December 31, 2009. In November 2010, our remaining two $40.0 million interest rate swap agreements matured and

were not renewed, and, as a result, there was no notional amount outstanding as of December 31, 2010.

Convertible Subordinated Senior Notes and Redeemable Convertible Preferred Stock

In 2003, we obtained private financing of $31.8 million in convertible subordinated senior notes. During 2007, in connection with the issuance of our Series D Redeemable Convertible Preferred Stock, we repaid a portion of the convertible subordinated senior notes and concurrently extended the maturity date to December 2010 (the “Modified Notes”).

The Modified Notes were convertible into common stock at any time at the election of the holders at a conversion price of $8.00 per share. The Modified Notes accrued interest at 10.5% per annum, payable quarterly.

In October 2008, we amended the Modified Notes to modify the conversion feature so that in addition to the right to convert the Modified Notes into shares of our common stock, the Modified Notes were convertible into shares of a new series of redeemable convertible preferred stock designated as Series E Redeemable Convertible Preferred Stock (“Series E Preferred Stock”), that with respect to rights upon liquidation, winding up and dissolution, rank pari passu to our Series B Redeemable Convertible Preferred Stock, Series C Redeemable Convertible Preferred Stock and Series D Redeemable Convertible Preferred Stock. The Series E Preferred Stock has the right to vote on an as-converted basis as a class with the holders of our common stock on matters submitted to the holders of our common stock. The Series E Preferred Stock also has participating rights and yields no stated dividends. The Series E Preferred Stock is convertible into common stock at any time at the election of the holders at an initial conversion price of $8.00 per share. The Series E Preferred Stock has no stated maturity and provides for the redemption of these securities at the election of the holders in the event of a change of control, at an offer price in cash equal to 101% of the liquidation amount. In December 2010, the holders of the Modified Notes elected to convert all of the Modified Notes to Series E Preferred Stock. See Note 10, “Redeemable Convertible Preferred Stock,” to our consolidated financial statements included elsewhere in this prospectus for additional information about our redeemable convertible preferred stock.

We have the right to require the conversion of the Series E Preferred Stock in whole, but not in part, if we complete an initial public offering, which results in gross proceeds of at least $50.0 million and the common stock sold in such offering is sold to the public at a price of at least $16.00 per share, or upon the occurrence of a liquidation event (as defined in the Series E Preferred Stock documents), as long as the cash consideration is at least 200% of the Series E Preferred Stock conversion price.

The holders of Series B Redeemable Convertible Preferred Stock are entitled to receive quarterly dividends on each share at a rate per annum equal to 6.4% of the Liquidation Amount, which is $20.00 per share, and one-half of such dividends must be paid in cash, otherwise the dividend rate increases to 10.0%. These dividends are cumulative, whether or not earned or declared, accruing on a daily basis, and unpaid dividends will compound on a quarterly basis. The holders of Series C Redeemable Convertible Preferred Stock and Series D Redeemable Convertible Preferred Stock are entitled to receive quarterly dividends on each share at a rate per annum equal to 6.4% of the Liquidation Amount, which is $20.25 per share. One-half of the Series C dividends must be paid in cash, otherwise the dividend rate increase to 10.0%. Similar to Series B Redeemable Convertible Preferred Stock, these dividends are cumulative, whether or not earned or declared, accruing on a daily basis and unpaid dividends compound on a quarterly basis. The Series B, Series C and Series D Redeemable Convertible Preferred Stock have no stated maturity and provide for the redemption of such securities at the election of the holders in the event of a change of control, at an offer price in cash equal to 101% of the liquidation amount.

We also have other conditions which apply to our outstanding redeemable convertible preferred stock. If any shares of Series B, Series C or Series D are outstanding on September 30, 2011, the

dividend rate on each share of Series B, Series C or Series D Redeemable Convertible Preferred Stock (whichever is outstanding) shall increase by 1.0% per annum on such date and shall increase by an additional 1.0% per annum on September 30 of every year thereafter up to a maximum dividend rate of 15.0% per annum until such time as no shares of redeemable convertible preferred stock shall remain outstanding.

We are permitted to pay up to half of the dividends on the redeemable convertible preferred stock in kind and our ability to pay such dividends in cash is restricted by the terms of the ABL Revolver and the Indenture. See Note 9, “Debt,” to our consolidated financial statements included elsewhere in this prospectus for additional information about our debt and credit facilities

In 2009 and 2010, we obtained waivers from the holders of the Modified Notes for non-compliance with the minimum required $100.0 million EBITDA for the last twelve-month period for each of the five quarters ended March 31, 2010. Additionally, we obtained waivers in 2007, 2009 and 2010 from the redeemable convertible preferred stockholders for non-compliance with certain financial covenants.

We have the right to require the conversion of the Series B, Series C and Series D Redeemable Convertible Preferred Stock in whole, but not in part, if we complete an initial public offering which results in gross proceeds of at least $100.0 million and the common stock in such offering is sold to the public at a price of at least 130% of the Conversion Price then in effect.

Cash Requirements

Historically, we have had significant cash requirements as we organically expanded our business into new geographic and product markets. Our requirements for cash include the costs related to increased working capital, primarily accounts receivable and inventory, offset partially by accounts payable. Our working capital needs are driven by the seasonality and growth of our business with our cash requirements being greater in periods of growth. Additional cash requirements resulting from our growth include the costs of additional personnel, production and distribution facilities, enhancing our information systems and, in the future, our integration of any acquisitions and our compliance with laws and rules applicable to a public company.

We have historically relied on available lines of revolving credit (and, to a lesser degree, factoring arrangements), cash from our operations and trade credit provided by our suppliers to finance our working capital requirements and to support our growth. As of December 31, 2010, we had over $1.3 billion in available trade credit provided by our suppliers.

Contractual Obligations

The following table summarizes our estimated contractual cash obligations and commitments as of December 31, 2010, before giving effect to the offering and the application of proceeds therefrom, and their effect on our liquidity and cash flow in future periods:


	Payments Due by Periods
			Within One		One to Three		Three to Five		More Than
	Total		Year		Years		Years		Five Years
	(In thousands)

Revolving credit facility(1)	$	—	$	—	$	—	$	—	$	—
Trade and other bank facilities, including capital leases		203,805		201,219		2,111		180		295
Senior notes(2)		250,000		—		—		—		250,000

Contractual debt repayment(3)		453,805		201,219		2,111		180		250,295
Upfront fees(4)		4,015		4,015		—		—		—
Non-cancelable operating lease(5)		38,907		10,685		15,905		8,135		4,182
Interest on senior notes and capital leases(6)		141,008		24,010		47,669		47,544		21,785
Uncertain tax positions(7)		—		—		—		—		—

		637,735		239,929		65,685		55,859		276,262
Redeemable convertible preferred stock(8)		409,090		—		—		—		—

Total	$	1,046,825	$	239,929	$	65,685	$	55,859	$	276,262


(1)		As of December 31, 2010, there was $83.7 million in outstanding letters of credit under our revolving credit facility.


(2)		In May 2011, we issued an additional $100.0 million aggregate principal amount of 2016 Notes under the indenture dated November 30, 2010, pursuant to which we have previously issued $250.0 million aggregate principal amount of 2016 Notes.


(3)		See Note 9, “Debt,” to our consolidated financial statements includes elsewhere in this prospectus.


(4)		Represents upfront fees related to our exclusive distribution and service agreements with Telefonica International, S.A.U., and subsidiaries. The agreement gives us the exclusive rights to sell netbooks (smaller and less expensive version of laptop) and provide other logistics services throughout Latin America to Telefonica subsidiaries. Amounts are based upon the payment schedule within the distribution and services agreement.


(5)		Represents future lease payments associated with vehicles, equipment and properties under operating leases. Amounts are based upon the general assumption that the leased asset will remain on lease for the length of time specified by the respective lease agreements. No effect has been given to renewals, cancellations, contingent rentals or future rate changes.


(6)		Total debt matures at various dates through 2016 and bears interest at various interest rates. We have reflected interest that is attributable to existing capital leases and our senior notes, all of which have fixed interest rates. The interest reflected does not consider potential refinancing of expiring debt obligations, or prepayments. We have not reflected interest attributable to our revolving credit facility or other trade and bank facilities, as the amounts due under these facilities vary by period.


(7)		We have excluded liabilities related to uncertain tax positions recognized under ASC 740 Income Taxes, as we are unable to reasonably estimate the ultimate amount or timing of settlement. See Note 12 to our consolidated financial statements included elsewhere in this prospectus for further information.


(8)		The liquidation value of our Series B, C, D and E Redeemable Convertible Preferred Stock includes accrued but unpaid dividends. Our redeemable convertible preferred stock has no stated maturity and may be redeemed at the option of the holder upon change of control. As such, as of December 31, 2010, the redemption date was unknown and payment is not reflected in a particular period and additional dividend accruals are not reflected through the redemption date, since such date was unknown as of December 31, 2010. Dividends on our Series B, C and D Redeemable Convertible Preferred Stock are calculated based on the liquidation value of the redeemable convertible preferred stock and dividend rates, which will increase by 1.0% annually, commencing September 30, 2011, to a maximum of 15.0%.

Other Contractual Commitments

In connection with the shareholders’ agreement entered into in connection with the establishment and operation of Brightstar Europe in April 2007, we agreed to make available a loan facility to fund the operations of Brightstar Europe for $40.0 million and each of the two parties to the shareholders’ agreement also agreed to provide 50% of the future funding of the company. Through December 31, 2010, we had funded $40.0 million of the loans. Brightstar Europe became profitable in 2009. We continue to evaluate the operations of Brightstar Europe and a change in its profitability may result in further discussion with our partner that may lead to modification of the business plans, current commitments under the shareholders’ agreement, or other available remedies, if any. During 2010, Brightstar Europe acquired certain operations that were funded through cash from operations and additional funding provided by its shareholders and third-party financing.

In September 2009, we amended and restated our payment terms agreement (the “PTA”) with Motorola and its subsidiaries (collectively, “Motorola”). The PTA sets forth the terms for repayment of the credit lines established for us and our subsidiaries in our distribution agreements with Motorola and also sets forth the collateral requirements for the credit line. The credit line, and all our other obligations to Motorola, including our indemnity obligations, is collateralized by a second priority security interest on all of our domestic assets and those of our domestic subsidiaries (each of our domestic subsidiaries is a guarantor of Brightstar Corp.’s obligations under the PTA). However, equity interests in subsidiaries held by a party to the PTA are not part of the collateral. The PTA incorporates the affirmative and negative covenants from our ABL Revolver. We are subject to certain events of default under the PTA, including defaults based on bankruptcy and insolvency events, non-payment, cross-defaults on other indebtedness, a change of control in our company and any material inaccuracy of our representations and warranties. The outstanding balance under the PTA is included on our balance sheet as part of accounts payable.

Off-Balance Sheet Arrangements

As of December 31, 2009 and 2010, we had no off-balance sheet arrangements.

Impact of Inflation and Changing Prices

A portion of our business is conducted in countries in which inflation can have a material effect on the relative purchasing power of money over time. However, other than the effects of foreign currency exchange rate fluctuations that may be affected by inflation, we believe that our results of operations are not materially affected by moderate changes in the inflation rate.

Seasonality and Fluctuations in Operating Results

Our revenue is subject to product availability and seasonal fluctuations as a result of holidays, manufacturer and operator promotions and other events affecting customer demands, including the introduction of new products and general economic conditions. As a result, we generally experience higher revenue and earnings in the second half of the year, particularly in the fourth quarter due to the holiday season, as compared to the first half of the year.

Material Weaknesses and Remediation Efforts

In connection with the preparation of our financial statements for the years ended December 31, 2009 and 2010, we identified several material weaknesses in our internal controls over financial reporting. However, these material weaknesses have not resulted in a qualified opinion on our audited financial statements for the years ended December 31, 2009 and 2010. Over the course of 2010, we were successful in remediating several material weaknesses indentified in 2009, and the ones that remained at December 31, 2010 were weaknesses not remediated from the prior year due to the short time cycle available to get all 2009 material weaknesses remediated. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of a company’s annual or interim financial statements will not be prevented or detected on a timely basis. A deficiency in internal control over financial reporting exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect misstatements on a timely basis. These material weaknesses are described in detail in “Risk Factors — Risks Related to Our Business — We have identified material weaknesses in our internal control over financial reporting which, if not successfully remediated, could cause us to fail to timely report our financial results, prevent fraud and avoid material misstatements in our financial statements.”

We are committed to remediating the deficiencies constituting material weaknesses by implementing changes to our internal control over financial reporting. Our Chief Executive Officer and our Chief Financial Officer are responsible for implementing changes and improvements to the internal controls that resulted in these material weaknesses.

Management believes we will complete our remediation plan in 2011. We cannot guarantee that we will be able to complete these actions on schedule or effectively and, even if we do successfully complete them, there is no guarantee that these measures will effectively address our material weaknesses. In addition, it is possible that we could discover additional material weaknesses in our internal control over financial reporting in the future.

Critical Accounting Policies and Estimates

The discussion of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with generally accepted accounting principles in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue, costs and expenses. On an ongoing basis, we evaluate our estimates and assumptions, which we base on third-party data, historical experience and on various other assumptions that we believe are reasonable under the circumstances. The results of our analysis form the basis for making assumptions about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions and the impact of such differences may be material to our consolidated financial statements.

Critical accounting policies are those policies that, in management’s view, are most important in the portrayal of our financial condition and results of operations. The footnotes to the consolidated financial statements also include disclosure of significant accounting policies. The methods, estimates and judgments that we use in applying our accounting policies have a significant impact on the results that we report in our financial statements. These critical accounting policies require us to make difficult and subjective judgments, often as a result of the need to make estimates regarding matters that are inherently uncertain. Our most critical accounting policies and estimates include those involved in the recognition of revenue and provision for income taxes. Those critical accounting policies and estimates that require the most significant judgment are discussed further below.

Revenue Recognition

Revenue is primarily derived from the sale of wireless communications equipment and related accessories, and to a lesser extent from our customer services and solutions. Product and service revenue is recognized in accordance with ASC 605, specifically ASC 605-10, when all of the following criteria are satisfied: (i) persuasive evidence of an arrangement exists; (ii) the price is fixed or determinable; (iii) collectability is reasonably assured; and (iv) delivery of products has occurred or services have been performed. Our arrangements for product sales with our customers do not contain customer acceptance provisions that would preclude recognition of revenue upon delivery of the product or when services are rendered. We do not have any substantial obligations after delivery of the product or after services are rendered.

Revenue derived under certain contractual arrangements may take the form of agreements that contain multiple elements, including warehouse logistic services, implementation of technology enablers, and ongoing supply chain, retail and enterprise services. These arrangements may have both fixed and variable components as well as contingent performance incentive compensation, designed to link a portion of our revenue to our performance relative to both qualitative and quantitative goals. Performance incentives are recognized as revenue for quantitative targets when the target has been achieved and for qualitative targets when confirmation of the incentive is received from the client. These arrangements may also provide for other strategic services where revenue earned is based on the achievement of cost savings to the customer. We allocate revenue between the elements based on the relative selling price method, provided that each element meets the criteria for treatment as a separate unit of accounting as outlined in ASC 605-25.

In applying the allocation criteria within ASC 605-25, we must apply considerable judgment when considering a variety of factors in determining the appropriate method of revenue recognition under these arrangements, such as whether the elements are separable, whether there are determinable fair values and whether there is a unique earnings process associated with each element of a contract. The judgments we make can have a significant effect on the timing and amount of revenue we recognize.

In compliance with ASC 605-45 we assess whether we or the third-party supplier is the primary obligor in sales transactions. We evaluate the terms of our customer arrangements as part of this assessment and apply significant judgment when determining if we are the primary obligor in the arrangement. In addition, we give appropriate consideration to other key indicators such as general inventory risk, latitude in establishing price, discretion in supplier selection and credit risk to the vendor. Accordingly, we generally record revenue on a gross basis when we believe the key indicators of the business suggest we generally act as principal on behalf of our clients. Where the key indicators suggest we act as an agent, we record revenue on a net basis.

Allowance for Doubtful Accounts

We provide credit terms to nearly all of our customers in the ordinary course of business. We try to mitigate the risks associated with providing credit by performing credit evaluations and obtaining credit insurance. In determining the adequacy of the allowance for doubtful accounts, our management considers a number of highly subjective factors, including creditworthiness of our customers and general economic conditions in the countries in which we operate, the aging of our accounts receivable and customer payment trends. Additionally, we consider the risk in the foreign countries in which we operate and record provisions for estimated losses on receivables when we believe it is probable that the general economic conditions of a particular foreign country will result in increased credit exposure. Although we have not historically experienced a significant level of bad debt expense, future events or changes in circumstances could result in changes to our estimates that could have a material adverse effect on our results of operations, financial position or cash flows.

Inventory Valuation

We value our inventory at the lower of cost or its estimated current market value, which requires us to make significant judgments related to current market values, expected future sales volumes and supplier incentives earned through purchases but unrealized pending the sale of the related products. We record provisions for estimated excess and obsolete inventories that consider a number of factors, including the aging of the inventory, recent sales trends and industry, market and economic conditions. In assessing inventory write-downs, management also considers any price protection credits or other incentives that we expect to receive from our suppliers. Variations in the estimates we use could result in a material adverse effect on our results of operations, financial position or cash flow, if we determine additional provisions are required in a future period.

Value Added Tax

Our international subsidiaries may be subject to Value Added Tax (VAT), which is typically applied to goods and services purchased in countries where VAT is applied. We are required to remit the VAT we collect to tax authorities, but may deduct the VAT we have paid on eligible purchases. In certain circumstances, the collection of the VAT receivable may extend over a period of years. We review our VAT receivable for impairment whenever events or changes in circumstances indicate the carrying amount of our VAT receivable may not be recoverable.

Share Based Payments and Other Equity Transactions

Our Stock Plans are administered by a committee of our Directors (the “Committee”). The Committee generally sets stock option exercise prices at 100% or above of the estimated fair market value of the underlying common stock on the date of grant. Historically, the Committee established exercise prices based on independent third party valuations.

Prior to this offering, there has not been an established market for our shares. While we have issued new equity to unrelated parties and we use such facts in the determination of the fair value of our shares, we believe that the lack of a secondary market for our common stock and our limited history issuing stock to unrelated parties make it impracticable to estimate our common stock’s expected volatility. Therefore, it is not possible to reasonably estimate the grant-date fair value of our options using our own historical price data. Accordingly, we applied the provisions of ASC 718 in accounting for the share options under the calculated value method.

A summary of stock option activity during the years ended December 31, 2008, 2009 and 2010 follows:


						Weighted-
						Average
				Weighted-		Remaining		Aggregate
				Average		Contractual		Intrinsic
	Shares			Exercise Price		Term		Value(a)
								(In thousands)

Outstanding as of January 1, 2008		1,639,992		$	13.46
Granted		1,510,250			14.83
Exercised		—			—
Forfeited		(846,587	)		13.99

Outstanding as of December 31, 2008		2,303,655		$	14.17		8.34	$	—

Exercisable as of December 31, 2008		877,833		$	12.00		6.39	$	—

Outstanding as of January 1, 2009		2,303,655		$	14.17
Granted		975,000			15.00
Exercised		(2,000	)		8.00
Forfeited		(956,885	)		14.66

Outstanding as of December 31, 2009		2,319,770		$	14.32		7.96	$	69

Exercisable as of December 31, 2009		919,145		$	12.94		6.14	$	69

Outstanding as of January 1, 2010		2,319,770		$	14.32
Granted		852,500			30.00
Exercised		(6,100	)		12.92
Forfeited		(242,225	)		15.09

Outstanding as of December 31, 2010		2,923,945		$	18.83		7.90	$	32,660

Exercisable as of December 31, 2010		1,348,945		$	15.45		6.69	$	19,628


(a)		The aggregate intrinsic value represents the amount by which the fair value of underlying stock exceeds the option exercise price for the periods presented.

During 2010, we granted 852,500 stock options, of which 591,250 were granted in July and 261,250 were granted in December. The stock options in both grant periods had an exercise price of $30.00 per share which equaled the fair market value of our common stock in those periods. The valuations of our common stock were performed by an independent third party contemporaneously with each of the corresponding grant periods. Based on the offering price of $ per share (the midpoint of the price range set forth on the cover of this prospectus), the aggregate intrinsic value of our common stock outstanding as of December 31, 2010 was $ .

The calculated fair value of each incentive award was estimated on the date of grant using the Black-Scholes option-pricing model, using the following considerations:


	•	We have elected to calculate the average expected life based on the simplified method described in ASC 718 for all at-the-money grants, as we believe it will be a better representation of the estimated life than our actual limited historical exercise behavior. For grants where the exercise price is significantly higher than the estimated fair value of the common stock at grant date, we use the Monte Carlo Simulation method to estimate expected option life.

	•	We use an expected dividend yield of zero, since we do not intend to pay dividends on our common stock for the foreseeable future.


	•	The risk-free interest rate is based on U.S. Treasury zero-coupon issues with a remaining term equal to the expected option life assumed at the date of grant.


	•	In 2010, the expected volatility is based on the average volatility of up to 19 companies within various SIC industries as management believes that we fit the profile of the companies selected. In 2008 and 2009, the expected volatility was based on a weighting of the volatility of 10 companies within the SIC Industry 5065, Electronic Parts and Equipment, not Elsewhere Classified, as management believed we fit the profile of the companies selected. The group of companies selected was then divided in two groups, and each group was given a different weight based on what management believed was appropriate, using each group’s past financial history.

	•	Forfeitures are estimates using historical experience and projected employee turnover.

These estimates require a considerable degree of judgment and affect the amount of compensation expense we recognize. If we determine that another method to estimate expected volatility or expected term is more reasonable than our current methods, or if another method for calculating fair value is prescribed by authoritative guidance, the fair value calculated for future stock-based awards could change significantly from past awards, even if the principal terms of the awards are similar. Higher volatility and longer expected terms result in an increase to stock-based compensation determined at the date of grant. The expected dividend rate and expected risk-free interest rate are not as significant to the calculation of fair value. A hypothetical 10% increase or decrease to any of the above assumptions would not have had a material impact on the amount of stock-based compensation expense we recognized in any of the periods presented. However, although changes in assumptions relative to our 2010 expense would be considered immaterial to us, future years could result in a more significant difference if we were to grant additional stock options, the value of our Class A common stock increases significantly or our estimated volatility is higher.

Fair Value of Financial Instruments

We are also required to apply complex accounting principles with respect to accounting for financing transactions that we have consummated in order to finance the growth of our business. These transactions, which consist of debt and redeemable convertible preferred stock, require us to use significant judgment in order to assess the fair values of these instruments at the dates of issuance. We have historically estimated these fair values based on independent transactions with third parties and independent valuations. These fair values are critical to our determination of financing costs and presentation of how we finance our business.

Income Taxes

We utilize the asset and liability method of accounting for income taxes, which requires significant judgments in determining the consolidated provision for income taxes. During the ordinary course of business, there are many transactions and calculations for which the ultimate tax settlement is uncertain. Under ASC 740, we are required to evaluate the realizability of our deferred tax assets. The realization of our deferred tax assets is dependent on future earnings. ASC 740 requires that a valuation allowance be recognized when, based on available evidence, it is more likely than not that all or a portion of deferred tax assets will not be realized due to the inability to generate sufficient taxable income in future periods. In circumstances where there is significant negative evidence, establishment of a valuation allowance must be considered. A pattern of sustained profitability is considered significant positive evidence when evaluating a decision to reverse a valuation allowance. Further, in those cases where a pattern of sustained profitability exists, projected future taxable income may also represent positive evidence, to the extent that such projections are determined to be reliable given the current economic environment. Accordingly, the increase and decrease of valuation allowances requires considerable judgment and could have a significant negative or positive impact on our current and future earnings.

On January 1, 2009, we were required to adopt a provision within ASC 740, which prescribes a recognition threshold and measurement process for recording in our consolidated financial statements

uncertain tax positions taken, or expected to be taken by the Company. Additionally, ASC 740 provides guidance on the derecognition, classification, accounting in interim periods and disclosure requirements for uncertain tax positions. The standard requires us to accrue for the estimated amount of taxes for uncertain tax positions if it is more likely than not that we would be required to pay such additional taxes, which requires considerable judgment. An uncertain tax position will not be recognized if it has a less than 50% likelihood of being sustained. Although we believe we have adequately reserved for our uncertain tax positions, the ultimate outcome of these tax matters may differ from our expectations, which could have a material effect on our provision for income taxes at the time such determination is made.

Recently Issued Accounting Pronouncements

In September 2009, the FASB ratified Accounting Standards Update 2009-13, codified within ASC 605 which addresses criteria for separating the consideration in multiple element arrangements. ASC 605 requires companies allocate the overall consideration to each deliverable by using a best estimate of the selling price of individual deliverables in the arrangement in the absence of vendor-specific objective evidence or other third-party evidence of the selling price. ASC 605 will be effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010 and early adoption will be permitted. There was no impact on our consolidated financial statements upon adoption.

Quantitative and Qualitative Disclosures about Market Risk

Concentration of Credit Risk

We are exposed to market risk relating to our operations due to changes in foreign currency exchange rates and interest rates. We manage the exposure to these risks through a combination of normal operating and financing activities and derivative financial instruments such as foreign currency derivative contracts and interest rate swaps. It is our policy not to enter into derivative financial instruments for speculative purposes.

Exchange Rate Risk Management

We are exposed to foreign currency risks that arise from normal business operations. These risks include the translation of local currency balances of foreign subsidiaries, intercompany loans with foreign subsidiaries and transactions denominated in foreign currencies. Our objective is to minimize our exposure to these risks through a combination of normal operating activities and the utilization of foreign currency contracts to manage our exposure on the transactions denominated in currencies other than the applicable functional currency. Contracts are executed with creditworthy banks and other institutions and are denominated in currencies of major industrial countries. At times we also hedge our exposure to the translation of reported results of foreign subsidiaries from local currency to U.S. dollars.

We use a cash hedging strategy to protect against an increase in the cost of forecasted foreign currency denominated transactions. As of December 31, 2009 and 2010, we had outstanding forward contracts in the notional amounts of $86.6 million and $164.0 million, respectively, buying (selling) U.S. dollars to fix the future cash outflows in local currency (U.S. dollars) on certain payables denominated in U.S. dollars (local currencies). The fair values of the outstanding forward contracts in the aggregate as of December 31, 2009 and 2010 were liabilities of $1.5 million and $0.2 million, respectively.

A hypothetical 10% adverse change in all exchange rates relative to the U.S. dollar would have reduced our income from continuing operations by $15.5 million in 2010.

Interest Rate Risk Management

We are exposed to interest rate risk on certain of our short-term and long-term debt obligations used to finance our operations and acquisitions. We have LIBOR-based and prime-based floating rate borrowings, which expose us to variability in interest payments due to changes in the reference interest rates. From time to time we use derivative instruments as hedges against the impact of interest rate changes on future earnings and cash flow.

In November 2008, we entered into pay fixed/receive LIBOR-based floating interest rate swaps to manage fluctuations in cash flows resulting from interest rate risk. In November 2010, our remaining interest rate swap agreements matured and were not renewed, such that there was no notional amount outstanding as of December 31, 2010.

As of December 31, 2010, we had $187.2 million of variable rate borrowings outstanding. Holding other factors constant, a hypothetical 1% increase in our borrowing rates would result in a $1.9 million increase in our annual interest expense based on our variable rate debt as of December 31, 2010.

BUSINESS

Overview

We are a leading global services company focused on enhancing the performance and profitability of the key participants in the wireless device value chain: manufacturers, operators, retailers and enterprises. We provide a comprehensive range of customized services consisting of value-added distribution, supply chain, retail and enterprise and consumer services. Our services help our customers manage the growing complexity of the wireless device supply chain and allow them to increase the number and type of wireless devices they sell, expand the number of locations at which they sell them and drive supply chain efficiencies which minimize their costs and therefore improve profitability. In addition, our services help our customers generate demand for wireless devices and decrease the time between purchasing and selling of devices which drives incremental revenues and profits for our customers. The rapid growth of the approximately $200 billion global wireless industry (Source: Gartner)¹ and increasing number and type of wireless activatable devices have resulted in a complex industry, or ecosystem, where manufacturers, operators, retailers and enterprises have differing priorities and are burdened with tasks that are critical, but not core, to their businesses. We believe that our global presence, scale and position as a key participant in the wireless ecosystem provide us with unique insight into the entire wireless device value chain and enhance our ability to offer differentiated, value-added services to our customers. We currently offer over 100 individual services in 50 countries across six continents, and we intend to continue innovating and adding services that deliver value to our customers.

We offer the following service categories:


	•	*Value-Added Distribution Services* are provided to manufacturers of wireless devices and related accessories. Our services include product distribution, transportation and delivery, order management, light manufacturing and assembly, and marketing and demand generation. Some examples of these services include selling wireless devices to operator and retailer customers; transporting wireless devices from a manufacturing facility in Asia to wireless specialized stores in Latin America, managing the customs and importation process; kitting, or preassembly of individual items into ready-to-ship kits, packing and programming of wireless devices in different languages; and managing sales and marketing activities for wireless devices at the point of sale.


	•	*Supply Chain Services* are provided to manufacturers, operators and retailers. Our services include product lifecycle management, device sourcing, business intelligence, such as demand and pricing trends, and supply chain optimization services, such as forward and reverse logistics. An example of these services is a network operator utilizing our tools to select its wireless device portfolio and procure devices using our sourcing and business intelligence database and portal.


	•	*Retail Services* are provided to manufacturers, operators, retailers and enterprises. Our services include wireless product management, portfolio management with virtual inventory and sales force training and management. Some examples of these services include operators using our services to run and staff stores and kiosks, and mass retailers outsourcing the management of the wireless device category to us.


	•	*Enterprise and Consumer Services* are provided to manufacturers, operators, retailers and enterprises. Our services include device activation, customized billing and wireless administration software, and handset protection insurance. An example of these services is a network operator who offers our handset insurance services and extended warranty products to its customers.

We are a global organization supporting manufacturers, operators, retailers and enterprises and reach over 90,000 points of sale worldwide. Our customers are some of the leading companies in the

¹ Gartner Inc.: Forecast: Mobile Devices, Worldwide, 2008-2015, 1Q11 Update. By Carolina Milanesi, Annette Zimmermann, Roberta Cozza, Anshul Gupta, Atsuro Sato, CK Lu, Tuong Nguyen and Hugues de la Vergne. 17 March 2011.

wireless device value chain. Among others, our customers include manufacturers such as LG, Motorola, Nokia, RIM and Samsung; operators such as America Movil, Iusacell, Movilnet, Telefonica and Telstra; retailers such as Best Buy, Walmart and Wireless Advocates; and enterprises such as PC Connection. Over 90% of our revenue is derived from sales of wireless devices.

Manufacturers, operators, retailers and enterprises choose us because of our wireless expertise, global reach, scale and extensive distribution network consisting of more than 33,000 customers, including more than 150 manufacturers, 180 network operators, 15,000 mass retailers and 4,800 technology value-added resellers. Our customers also choose us because of our track record of high quality service and execution, our proprietary technology and systems, the strength and capability of our professionals and our ability to create and tailor our portfolio of services, or innovate new ones, to our customer’s particular needs.

For the year ended December 31, 2010, our revenue grew 70% to $4.6 billion relative to the year ended December 31, 2009, and we generated Adjusted EBITDA of $141.2 million, net income of $39.8 million and Adjusted net income of $60.6 million as compared to Adjusted EDITDA of $111.4 million, net income of $58.3 million and Adjusted net income of $58.7 million in the year ended December 31, 2009. For a reconciliation of Adjusted EBITDA and Adjusted net income to net income, see “Prospectus Summary — Summary Consolidated Financial and Other Data.”

Wireless Industry Overview

The wireless industry is large and growing, and encompasses an increasingly broad and complex array of wireless devices, including feature phones, smartphones, e-readers and tablets, and their related accessories. According to Gartner, mobile device revenue is estimated to grow from $168.1 billion in 2009 to $285.6 billion in 2015,¹ representing a 9.2% CAGR, an estimate which excludes potential incremental growth from the increasing number of wirelessly connected or “activatable” devices, such as tablets, e-readers, or gaming devices. The primary drivers of growth and increasing complexity are a rising number of wireless device users, a larger number of wireless ecosystem participants, greater levels of demand for data applications and mobile Internet access, and the emergence of a wide range of feature-rich wireless and other activatable devices with a broad mix of voice and data service plans and shortening product lifecycles. There are more than 700 operators globally, multiple network communication standards, various wireless device distribution channels and an increasing number of wireless device models with customized functionalities for specific consumers.

According to Gartner, approximately 1.2 billion wireless phones were shipped in 2009, a number which is expected to increase to approximately 2.4 billion in 2015,¹ representing a 11.9% CAGR. The largest growth area is smartphones which, according to Gartner, is expected to grow from 172.4 million devices sold in 2009 to 1,104.9 million devices sold in 2015,¹ representing a 36.3% CAGR. In addition, the number of activatable devices has increased significantly over the last few years with the introduction of tablets and e-readers. According to Gartner, tablet computer shipments are expected to grow from 17.6 million units in 2010, the first year for which Gartner industry data is available for tablet computer shipments, to 294.1 million units in 2015,² representing a 75.6% CAGR. Moreover, total shipments of

² Gartner Inc.: Forecast: Connected Mobile Consumer Electronics, 2008-2015, 1Q11 Update. By Carolina Milanesi; Roberta Cozza, Annette Zimmermann, Tuong Nguyen, Hugues de la Vergne and Jon Erensen. 1 April 2011.

connected devices, such as consumer electronic products, are expected to grow from 65.5 million devices in 2009 to 409.3 million devices in 2015, representing a 35.7% CAGR, according to Gartner².

A substantial portion of global subscriber growth has been driven by the prepaid wireless segment, which has become increasingly popular as customers are able to enjoy the benefits of a regular mobile handset without needing to commit to long-term network service contracts. The increased size and growth of the prepaid wireless segment has led to an increased use of retailers such as Best Buy and Walmart, as a more prevalent means for distribution to consumers in the U.S./Canada and Europe. We believe that this trend is likely to accelerate since retailers view wireless devices as an attractive product category that provides them with higher margin products.

Within developing markets such as Africa, Eastern Europe, Latin America, the Middle East and Southeast Asia, growth in the wireless industry has been driven primarily by growth in new wireless subscribers. Given the emergence of more cost-effective means for ownership, such as prepaid wireless devices, consumers in developing markets are now able to purchase wireless devices more easily than before. We believe that as the number of wireless devices within developing markets continue to rise, the market opportunity for value-added distribution, supply chain, retail and enterprise services will continue to increase given the challenges associated with reaching these markets.

The proliferation of new technologies and wireless devices and the increasing velocity of these new product introductions are resulting in the following key trends:


	•	Manufacturers needing to introduce new wireless devices to the market at a faster rate;


	•	Operators needing to meet customers’ demands for increased choice;


	•	Retailers needing to efficiently sell an increasingly large and rapidly changing set of available devices; and


	•	Enterprises needing to reduce the cost of and simplify the management of their wireless devices and rate plan deployments.

As new technologies are introduced, we believe manufacturers will look to companies with outsourced distribution, supply chain, retail and enterprise services for assistance with extending the reach of their products and services globally. The market growth opportunity is therefore comprised of multiple elements and driven partly by overall industry growth and in part by the growing need of service providers within the wireless industry.

Challenges Faced by Wireless Ecosystem Participants

We believe each participant in the wireless ecosystem faces differing challenges and priorities. For example, manufacturers focus on selling devices to operators; operators focus on maximizing their ARPU, minimizing churn and growing their subscriber base; retailers focus on selling devices and plans to consumers; and enterprises focus on getting the wireless device and rate plan combination that is best suited to their end users’ needs. We also believe that these differing challenges and priorities will become more prominent given the accelerating pace of technological innovation, the number of new market participants and continued growth of the wireless ecosystem. We believe these challenges include:

Challenges faced by Manufacturers


	•	Increasing need for faster product time-to-market;


	•	Increasing number of distribution channels through which products are sold;


	•	Increasing pressure on average selling price and wireless device margins;


	•	Ability to accurately forecast consumer demand trends for wireless products;


	•	Ability to reach a broadening set of consumers on a global basis;

	•	Difficulties and costs associated with customization for specific markets;

	•	Lack of local importation and manufacturing expertise in certain markets and geographies;


	•	Ability to manage high return rates of products and reverse logistics, or the logistics associated with their returns; and


	•	Ability to efficiently manage working capital.

Challenges faced by Operators


	•	Ability to increase ARPU and maximize customer retention rate;


	•	Ability to forecast demand for particular devices in different markets and geographies;

	•	Higher subscriber retention costs arising from increasing handset subsidies and declining contract prices;

	•	Complexity of distributing devices to customers in developing markets;

	•	Growing complexity and rapid evolution of handset and activatable device offerings;

	•	High degree of bargaining power of manufacturers, especially for smaller operators;

Brightstar Corp. S-1/A