===============================================================================
As filed with the Securities and Exchange Commission on October 30, 1998.
Registration No. 333-________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
--------------------
PACIFIC AEROSPACE & ELECTRONICS, INC.
(Exact Name of Registrant as Specified in its Charter)
Washington 91-1744587
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
-------------------
430 Olds Station Road
Wenatchee, Washington 98801
(Address of Principal Executive Offices)
-------------------
PACIFIC AEROSPACE & ELECTRONICS, INC.
1997 EMPLOYEE STOCK PURCHASE PLAN
(Full Title of Plan)
------------------
Donald A. Wright, Chief Executive Officer
PACIFIC AEROSPACE & ELECTRONICS, INC.
430 Olds Stations Road
Wenatchee, Washington 98801
(Name and Address of Agent for Service)
(509) 667-9600
(Telephone Number, Including Area Code, of Agent for Service)
-------------------
<TABLE>
<CAPTION>
Calculation of Registration Fee
========================================================================================
Proposed Maximum Proposed Maximum Amount of
Title of Securities Amount to be Offering Price Aggregate Registration
to be Registered Registered Per Share Offering Price(1) Fee
- ------------------- ------------ ---------------- ----------------- ------------
<S> <C> <C> <C> <C>
Common Stock, 1,000,000 1.969(1) $1,969,000 $547.38
par value
$.001 per share
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(h) under the Securities Act of 1933, as amended, and based
on the average of the high and low prices of the Common Stock as reported on the
Nasdaq National Market on October 27, 1998 by Nasdaq.
========================================================================================
</TABLE>
<PAGE>
INTRODUCTION
This Registration Statement on Form S-8 is filed by Pacific Aerospace &
Electronics, Inc., a Washington corporation (the "Company") relating to the
1,000,000 shares of the Company's common stock, par value $.001 per share (the
"Common Stock"), issuable upon the sale of Common Stock under the Company's 1997
Employee Stock Purchase Plan (the "Plan").
PART I
Item 1. Plan Information. *
Item 2. Registrant Information and Employee Plan Annual Information. *
* Information required by Part I of Form S-8 is omitted from this
Registration Statement in accordance with Rule 428 under the Securities Act
of 1933, as amended (the "Securities Act"), and the Note to Part I of Form
S-8.
PART II
Item 3. Incorporation of Documents by Reference.
The following documents, which previously have been filed by the Company
with the Securities and Exchange Commission (the "Commission"), are incorporated
herein by reference and made a part hereof:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended May
31, 1998.
(2) The Company's Quarterly Report on Form 10-Q for the quarter ended
August 31, 1998.
(3) The Company's Current Reports on Form 8-K filed with the Commission on
July 10, 1998 and August 14, 1998, and amendments to the Company's Current
Reports on Form 8-K/A filed with the Commission on August 26, 1998 and September
21, 1998.
(4) All other reports filed by the Company pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")
since the end of the fiscal year ended May 31, 1998.
(5) The description of the capital stock contained in the Company's
Registration Statement on Form 8-B filed with the Commission on February 6,
1997.
All documents subsequently filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act, subsequent to the date of this
Registration Statement and prior to the filing of a post-effective amendment
hereto which indicates that all securities offered hereunder have been sold or
which deregisters all securities remaining unsold, shall
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be deemed to be incorporated by reference herein and to be a part hereof from
the date of the filing of such documents.
For purposes of this Registration Statement, any statement contained in
this Registration Statement, or in a document all or a portion of which is
incorporated or deemed to be incorporated by reference herein, shall be deemed
to be modified or superseded to the extent that a statement contained herein or
in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
Article 8 of the Company's Articles of Incorporation authorizes the Company
to indemnify its directors to the fullest extent permitted by the Washington
Business Corporation Act through the adoption of Bylaws, approval of agreements,
or by any other manner approved by the Board of Directors.
In accordance with such authorization, Section 10 of the Company's Bylaws
("Bylaws") requires indemnification, to the fullest extent permitted by
applicable law, of any person who is or has served as a director or officer of
the Company, as well as any person who, while serving as a director or officer
of the Company, served at the request of the Company as a director, officer,
employee or agent of another entity, against expenses reasonably incurred
because such person was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether formal or
informal, civil, criminal, administrative or investigative.
Notwithstanding these indemnification obligations, Section 10 of the Bylaws
states that no indemnification will be provided (a) to the extent that such
indemnification would be prohibited by the Washington Business Corporation Act
or other applicable law as then in effect, or (b) except with respect to
proceedings seeking to enforce rights to indemnification, to any director or
officer seeking indemnification in connection with a proceeding initiated by
such person unless such proceeding was authorized by the Board of Directors.
Section 10 of the Bylaws also provides that expenses incurred in defending
any proceeding in advance of its final disposition shall be advanced by the
Company to the director or officer upon receipt of an undertaking by or on
behalf of such person to repay such amount if it is ultimately determined that
such person is not entitled to be indemnified by the Company, except where the
Board of Directors adopts a resolution expressly disapproving such advancement.
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Section 10 of the Bylaws also authorizes the Board to indemnify and advance
expenses to employees and agents of the Company on the same terms and with the
same scope and effect as the provisions thereof with respect to the
indemnification and advancement of expenses to directors and officers.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit
Number Description
- ------- -----------
4.1 Pacific Aerospace & Electronics, Inc. 1997 Employee Stock Purchase
Plan.(1)
4.2 Amendment No. 1 to Pacific Aerospace & Electronics, Inc. 1997
Employee Stock Purchase Plan.(1)
5.1 Opinion of Stoel Rives LLP.(1)
23.1 Consent of KPMG Peat Marwick LLP.(1)
23.2 Consent of Moss Adams LLP.(1)
23.3 Consent of KPMG Audit plc.(1)
23.4 Consent of PricewaterhouseCoopers LLP.(1)
23.5 Consent of Stoel Rives LLP (included in Exhibit 5.1).(1)
24.1 Power of Attorney.(1)
- ---------------
(1) Submitted with this Registration Statement.
Item 9. Undertakings.
The Company hereby undertakes:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement to:
(a) Include any prospectus required by Section 10(a)(3) of the
Securities Act;
(b) Reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent post-effective
amendment thereof) that, individually or together, represent a fundamental
change in the information in this Registration Statement; and
(c) Include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this Registration Statement;
provided, however, that sub-paragraphs (a) and (b) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is incorporated by
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reference from periodic reports filed by the Company pursuant to Section 13
or Section 15(d) of the Exchange Act.
2. That, for determining liability under the Securities Act, each
post-effective amendment shall be treated as a new registration statement of the
securities offered, and the offering of such securities at that time shall be
treated as the initial bona fide offering.
3. To file a post-effective amendment to remove from registration any of
the securities that remain unsold at the termination of the offering.
4. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in this Registration Statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
5. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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SIGNATURES
----------
Pursuant to the requirements of the Securities Act, the Company certifies
that it has reasonable grounds to believe that it meets all of the requirements
for filing on Form S-8 and has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Wenatchee, State of Washington, on October 30, 1998.
PACIFIC AEROSPACE & ELECTRONICS, INC.
By: /s/ DONALD A. WRIGHT
-------------------------------------
Donald A. Wright
Chief Executive Officer and President
(Principal Executive Officer)
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in the capacities indicated
below as of October 30, 1998:
Signature Title
--------- -----
/s/ DONALD A. WRIGHT Chief Executive Officer, President and
- ----------------------------- Director (Principal Executive Officer)
Donald A. Wright
/s/ NICK A. GERDE* Vice President Finance, Chief Financial
- ----------------------------- Officer and Treasurer (Principal
Nick A. Gerde Financial and Accounting Officer)
/s/ ALLEN W. DAHL, M.D.* Director
- -----------------------------
Allen W. Dahl, M.D.
/s/ DR. URS DIEBOLD * Director
- -----------------------------
Dr. Urs Diebold
/s/ WERNER HAFELFINGER * Director
- -----------------------------
Werner Hafelfinger
/s/ DALE L. RASMUSSEN* Director
- -----------------------------
Dale L. Rasmussen
/s/ WILLIAM A. WHEELER* Director
- -----------------------------
William A. Wheeler
*By /s/ DONALD A. WRIGHT
------------------------
Donald A. Wright
(Attorney-in-Fact)
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INDEX TO EXHIBITS
Exhibit
Number Description
- ------- -----------
4.1 Pacific Aerospace & Electronics, Inc. 1997 Employee Stock Purchase
Plan. (1)
4.2 Amendment No. 1 to Pacific Aerospace & Electronics, Inc. 1997
Employee Stock Purchase Plan. (1)
5.1 Opinion of Stoel Rives LLP. (1)
23.1 Consent of KPMG Peat Marwick LLP. (1)
23.2 Consent of Moss Adams LLP. (1)
23.3 Consent of KPMG Audit plc. (1)
23.4 Consent of PricewaterhouseCoopers LLP.(1)
23.5 Consent of Stoel Rives LLP (included in Exhibit 5.1). (1)
24.1 Power of Attorney. (1)
- ----------------
(1) Submitted with this Registration Statement.
7
PACIFIC AEROSPACE & ELECTRONICS, INC.
1997 EMPLOYEE STOCK PURCHASE PLAN
1. Purposes.
The Pacific Aerospace & Electronics, Inc. 1997 Employee Stock Purchase Plan
is intended to provide a convenient means by which eligible employees of the
Company and its subsidiaries may purchase shares of the Common Stock of the
Company and a method by which the Company may assist and encourage employees to
become shareholders of the Company.
2. Definitions.
Capitalized terms in this Plan have the following meanings:
(a) "Board" means the Board of Directors of the Company.
(b) "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
(c) "Common Stock" means the common stock, $.001 par value, of the Company.
(d) "Company" means Pacific Aerospace & Electronics, Inc., a Washington
corporation and any corporate successor to all or substantially all of the
assets or voting stock of Pacific Aerospace & Electronics, Inc. that adopts the
Plan by appropriate action.
(e) "Compensation" means all cash compensation, including any variable
compensation incentives, bonuses, or overtime.
(f) "Continuous Status as an Employee" means the absence of any
interruption or termination of service as an employee of the Company or a
Designated Subsidiary. Continuous Status as an Employee shall not be considered
interrupted in the case of a leave of absence agreed to in writing by the
Company or a Designated Subsidiary, provided that such leave is for a period of
not more than 90 days or re-employment upon the expiration of such leave is
guaranteed by contract or statute.
(g) "Custodian" means the brokerage firm selected by the Company to hold
shares purchased for Participants' accounts under the Plan.
(h) "Designated Subsidiaries" means the Subsidiaries whose employees are
eligible to participate in the Plan, as such subsidiaries may be designated by
the Board from time to time in its sole discretion.
(i) "Eligible Employee" means any person who has had Continuous Status as
an Employee for 90 days and is engaged, on a regularly-scheduled basis of more
than 20 hours
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per week and more than 5 months per calendar year, in providing personal
services to the Company or a Designated Subsidiary for earnings considered wages
under Section 3121(a) of the Code. No person will be an Eligible Employee if,
after an offering pursuant to the Plan, that person would own or be deemed
(under Section 424(d) of the Code) to own stock (including any stock that may be
purchased under any outstanding options (whether vested or unvested)) possessing
5% or more of the total combined voting power or value of all classes of stock
of the Company or any Subsidiary.
(j) "Enrollment Date" means the first trading day of each Offering Period.
(k) "Exchange Act" means the Securities Exchange Act of 1934, as amended.
(l) "Exercise Date" means the last trading day of each Offering Period.
(m) "Fair Market Value of a Share of Common Stock" means, for a given date,
the closing bid price of the Common Stock for that date as reported by the
National Association of Securities Dealers Automated Quotation (Nasdaq) National
Market System or, if such price is not reported, the average of the bid and
asked prices per share of Common Stock as reported by Nasdaq. If neither of the
foregoing methods is available, the Plan Administrator shall determine the Fair
Market Value of a Share of Common Stock in good faith, and such determination
will be conclusive and binding.
(n) "Offering Period" means, unless otherwise determined by the Plan
Administrator, a 12-month period during which Participants may purchase shares
of Common Stock under the Plan.
(o) "Option Price per Share" means, with respect to the shares offered in a
given Offering Period, the lower of: (i) 85% of the Fair Market Value of a Share
of Common Stock on the Enrollment Date for that Offering Period; or (ii) the
Fair Market Value of a Share of Common Stock on the Exercise Date.
(p) "Participant" means any Eligible Employee who is actively participating
in the Plan.
(q) "Plan" means this Employee Stock Purchase Plan.
(r) "Plan Administrator" means the Compensation Committee of the Board, as
appointed from time to time by the Board.
(s) "Subsidiary" means any corporation, domestic or foreign, of which not
less than 50% of the voting shares are held by the Company or a Subsidiary,
whether or not such corporation now exists or is hereafter organized or acquired
by the Company or a Subsidiary.
3. Administration.
The Plan Administrator shall supervise and administer the Plan and shall
have full power to (i) adopt, amend and rescind any rules deemed desirable and
appropriate for the
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administration of the Plan and not inconsistent with the Plan, (ii) construe and
interpret the Plan, and (iii) make all other determinations necessary or
advisable for the administration of the Plan. The Plan Administrator may
delegate administrative functions to the Custodian and/or to individuals who are
officers or employees of the Company or its Designated Subsidiaries. Subject
only to compliance with explicit provisions of the Plan, the Board and Plan
Administrator may act in their absolute discretion in all matters related to
this Plan. No member of the Board of Directors or the Plan Administrator, and no
officer or employee of the Company or any Subsidiary, shall be liable for any
action or inaction with respect to this Plan, except in circumstances involving
his or her own bad faith.
4. Offering Periods.
Shares of Common Stock will be offered for purchase under this Plan in a
series of Offering Periods, initially running from September 1, 1998 through
August 31, 1999, and thereafter from September 1 through August 31 of each year.
The Plan Administrator will have the power to change the duration and/or the
frequency of Offering Periods without stockholder approval if such change is
announced to Participants at least 15 days prior to the scheduled beginning of
the first Offering Period to be affected.
5. Participation.
Participation in this Plan is voluntary. An Eligible Employee may become a
Participant by completing an enrollment form, in a form prescribed by the Plan
Administrator, subscribing to the offering and authorizing payroll deductions,
and filing the enrollment form with the Company's payroll office at least 10
business days before the applicable Enrollment Date. Subject to the limitations
of Section 6(a), a Participant's enrollment form will remain in effect for
successive Offering Periods unless terminated as provided in Section 10.
6. Payroll Deductions.
(a) Amount. On a Participant's enrollment form, he or she will elect to
have payroll deductions made on each payday during the relevant Offering Period.
Each Participant may select his or her level of payroll deduction, subject to
any limitations imposed by law or this Plan. A Participant's total payroll
deductions during any Offering Period may not be more than 15% of the
Participant's total Compensation during the Offering Period, and the minimum
payroll deduction will be $20 per paycheck.
(b) Account. Individual accounts will be maintained for each Participant in
the Plan. Statements of account, setting forth the amounts of payroll
deductions, the per share purchase price of shares purchased, and the number of
shares purchased, will be given to Participants promptly following each Exercise
Date. All payroll deductions made for a Participant will be credited to his or
her account. A Participant may not make any additional payments into the
account.
(c) Changes. A Participant may discontinue his or her participation in the
Plan as provided in Section 10, but may not otherwise increase or decrease the
rate or amount of his
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or her payroll deductions during an Offering Period. A Participant may change
the rate or amount of his or her payroll deductions for the next Offering Period
by providing a new enrollment form to the Company at least 10 business days
before the Enrollment Date for the next Offering Period.
(d) Rule 16b-3. Employees who are officers or directors of the Company may
participate only in accordance with Rule 16b-3 under the Exchange Act.
7. Grant of Option.
On the Enrollment Date for each Offering Period, each Participant will be
granted an option to purchase, on the Exercise Date of that Offering Period, a
number of shares of Common Stock determined by dividing the Participant's
payroll deductions accumulated prior to the Exercise Date and retained in the
Participant's account as of the Exercise Date by the Option Price per Share. Any
such purchase will be subject to the limitations set forth in Sections 12 and 13
below. Exercise of the option will occur as provided in Section 8, unless the
Participant has withdrawn pursuant to Section 10.
8. Exercise of Option and Purchase of Shares.
A Participant's option for the purchase of shares will be exercised
automatically on the Exercise Date of the Offering Period. Subject to any
limitations on the number of shares that may be purchased as described in this
Plan, the maximum number of whole shares subject to option will be purchased for
the Participant at the applicable Option Price per Share with the accumulated
payroll deductions in his or her account. Any amount remaining in a
Participant's account after an Exercise Date because of limits on the number of
shares that may be purchased will be repaid to the Participant. Any amount
remaining in a Participant's account after an Exercise Date because it was not
sufficient to purchase a whole share will be carried over for application in the
next Offering Period. The shares purchased upon exercise of an option hereunder
will be deemed to be issued and sold to the Participant on the Exercise Date.
9. Delivery and Custody of Shares.
As promptly as practicable after the Exercise Date of each Offering Period,
the Company will deliver shares purchased for the Participants to the Custodian,
who will hold the shares for the Participants' accounts. The Custodian may hold
shares purchased under the Plan in nominee or street name certificates and may
commingle shares in its custody in a single account. By appropriate instructions
to the Custodian, at any time that a Form S-8 registration statement is
effective with respect to the shares or, in the opinion of counsel acceptable to
the Company, the shares may be resold without registration, a Participant may
instruct the Custodian to transfer shares held by the Custodian for the
Participant's account (with brokerage fees to be paid by the Participant).
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10. Withdrawal; Termination of Status.
(a) Withdrawal. A Participant may terminate his or her payroll deductions
during a current Offering Period by filing a withdrawal form with the Plan
Administrator at least 10 business days prior to the Exercise Date of the
Offering Period. In such event, all of the Participant's payroll deductions
credited to his or her account will be used to purchase shares in accordance
with Section 8 above, and, provided that payroll deductions may be made with
respect to any payday that is less than 10 business days after the Company's
receipt of a withdrawal form, no further payroll deductions for the purchase of
shares will be made unless the Participant reinstates participation in the Plan
by filing an enrollment form for a subsequent Offering Period. A Participant may
terminate his or her participation in the Plan as of the next Offering Period
without terminating his or her participation in the current Offering Period by
so stating on a withdrawal form filed at least 10 business days prior to the
Enrollment Date of the next Offering Period.
(b) Termination of Continuous Status as an Employee. Upon termination of a
Participant's Continuous Status as an Employee prior to the Exercise Date of an
Offering Period for any reason, including retirement or death, the payroll
deductions credited to the Participant's account will be returned to him or her
or, in the case of his or her death, to the person or persons entitled thereto
under Section 14, and the Participant's option will be automatically terminated.
(c) Termination of Full-Time Employment. If a Participant fails to maintain
Continuous Status as an Employee for at least 20 hours per week during an
Offering Period, the Participant will be deemed to have elected to withdraw from
the Plan, the payroll deductions credited to the Participant's account will be
returned to him or her, and his or her option will be automatically terminated.
(d) Withdrawal Irrevocable. A Participant's withdrawal from any Offering
Period will be irrevocable, and the Participant may not subsequently rejoin that
Offering Period. In order to resume participation in any subsequent Offering
Period, the Participant must re-enroll in the Plan by timely filing a new
enrollment form.
(e) Future Offerings. A Participant's withdrawal from an offering will not
have any effect upon his or her eligibility to participate in a future offering,
upon timely submission of a new enrollment form, or in any similar plan that may
hereafter be adopted by the Company.
11. Interest.
No interest will accrue on the payroll deductions of any Participant under
the Plan.
12. Common Stock.
(a) Shares Available under the Plan. The maximum number of shares of Common
Stock which shall be made available for sale under the Plan is 1,000,000 shares,
subject to adjustment upon changes in capitalization of the Company, as provided
in Section 17. If, on
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a given Exercise Date, the total number of shares with respect to which options
are to be exercised exceeds the number of shares then available under the Plan,
the Plan Administrator will make a pro rata allocation of the shares remaining
available for purchase in as uniform a manner as shall be practicable and as it
shall determine to be equitable. Any amounts remaining in a Participant's
account not applied to the purchase of stock because of the limitation in this
Section 12 will be refunded promptly after the Exercise Date.
(b) Shareholder Rights. A Participant will have no interest or voting right
in shares covered by his or her option until the shares are actually purchased
on the Participant's behalf in accordance with the Plan. After the purchase of
shares, the Participant will be entitled to all rights of a shareholder of the
Company.
13. Accrual Limitation.
No Participant will be entitled to accrue rights to acquire Common Stock
pursuant to any purchase right outstanding under this Plan if and to the extent
such accrual, when aggregated with rights to purchase Common Stock accrued under
any other purchase right outstanding under this Plan and similar rights accrued
under any other employee stock purchase plans (within the meaning of Section 423
of the Code), would otherwise permit the Participant to purchase more than
$25,000 worth of stock of the Company (determined on the basis of the fair
market value of such stock on the date or dates such rights are granted to the
Participant) for each calendar year such rights are at any time outstanding. In
the event there is any conflict between the provisions of this Section 13 and
one or more provisions of the Plan or any instrument issued under the Plan, the
provisions of this Section 13 will be controlling.
14. Designation of Beneficiary.
A Participant may file a written designation of a beneficiary who is to
receive any shares and cash, if any, from the Participant's account in the event
of the Participant's death. The designation of beneficiary may be changed by the
Participant at any time by written notice. In the event of the death of a
Participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of the Participant's death, the Company will
deliver the shares and/or cash to the executor or administrator of the estate of
the Participant. If no executor or administrator has been appointed (to the
knowledge of the Company), the Company, in its discretion, may deliver the
shares and/or cash to the spouse or to any one or more dependents or relatives
of the Participant, or if no spouse, dependent or relative is known to the
Company, then to such other person as the Company may designate.
15. Transferability.
Neither payroll deductions credited to a Participant's account nor any
rights with regard to the exercise of an option or the receipt of shares under
the Plan may be assigned, transferred, pledged or otherwise disposed of in any
way (other than by will, the laws of descent and distribution or as provided in
Section 14 hereof) by the Participant. Any
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attempt at assignment, transfer, pledge or other disposition will be without
effect, except that the Company may treat the act as an election to withdraw in
accordance with Section 10.
16. Use of Funds.
All payroll deductions received or held by the Company under the Plan may
be used by the Company for any corporate purpose, and the Company will not be
obligated to segregate the payroll deductions.
17. Adjustments Upon Changes in Capitalization.
(a) Changes in Common Stock. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each option under the Plan that has not yet been exercised and the number of
shares of Common Stock that have been authorized for issuance under the Plan but
have not yet been placed under option (collectively, the "Reserves"), as well as
the Option Price per Share of Common Stock covered by each option under the Plan
that has not yet been exercised, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of shares of Common Stock effected without receipt of consideration by
the Company. The conversion of any convertible securities of the Company will
not be deemed to have been effected without receipt of consideration. Any such
adjustment will be made by the Board, whose determination will be final, binding
and conclusive. Except as expressly provided herein, no issuance by the Company
of shares of stock of any class, or securities convertible into shares of stock
of any class, will affect, and no adjustment by reason thereof will be made with
respect to, the number or price of shares of Common Stock subject to an option.
(b) Dissolution; Sale. In the event of the proposed dissolution or
liquidation of the Company, the then current Offering Period will terminate
immediately prior to the consummation of the proposed action, unless otherwise
provided by the Board. In the event of a proposed sale of all or substantially
all of the assets of the Company, or the merger of the Company with or into
another corporation that results in more than 50% of the voting stock of the
Company being held by persons who were not, directly or indirectly, shareholders
of the Company immediately prior to the merger, each option under the Plan will
be assumed, or an equivalent option will be assumed or substituted, by the
successor corporation or a parent or subsidiary of the successor corporation,
unless the Board determines, in the exercise of its sole discretion, that the
Offering Period will terminate immediately prior to the consummation of the
proposed action.
18. Amendment or Termination.
The Plan became effective upon its adoption by the Board and will continue
in effect until the earlier of (i) August 31, 2008, or (ii) the date on which
all shares available for issuance under the Plan have been issued. However, no
share of Common Stock will be issued under the Plan until the Company obtains
approval of the shareholders of the Company within 12 months after the date the
Plan was adopted. If shareholder approval is
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not obtained within 12 months, this Plan will automatically terminate. The Board
may at any time and for any reason terminate or amend the Plan, except that any
amendment that would increase the number of shares of Common Stock available for
issuance under the Plan must be approved by the shareholders within 12 months of
adoption by the Board. In addition, except as provided in Section 17, no
amendment or termination may be made that would impair the rights of any
Participant under any grant theretofore made, without his or her consent. In
addition, to the extent necessary to comply with Rule 16b-3 under the Exchange
Act or Section 423 of the Code (or any other successor rule or provision or any
other applicable law or regulation), the Company shall obtain shareholder
approval of any Plan amendment in such a manner and to such a degree as
required. The Company shall have the right, exercisable in the sole discretion
of the Plan Administrator, to terminate all outstanding options under this Plan
immediately following the close of any Offering Period. Should the Company elect
to exercise this right, then this Plan will automatically terminate, no further
purchase rights will thereafter be granted or exercised, and no further payroll
deductions will thereafter be collected under this Plan.
19. Conditions Upon Issuance of Shares.
Shares will not be issued with respect to an option unless the exercise of
the option and the issuance and delivery of shares of Common Stock pursuant to
the option comply with all applicable provisions of law, domestic or foreign,
including without limitation the Securities Act of 1933, as amended, the
Exchange Act, the rules and regulations promulgated thereunder, and the
requirements of Nasdaq or any stock exchange upon which the shares may then be
listed, and shall be further subject to the approval of counsel for the Company
with respect to such compliance.
20. Tax Withholding.
Each Participant who has purchased shares under the Plan will immediately
upon notification of the amount due, if any, pay to the Company in cash amounts
necessary to satisfy any applicable federal, state and local tax withholding
determined by the Company to be required. If the Company determines that
additional withholding is required beyond any amount deposited at the time of
purchase, the Participant will pay such amount to the Company on demand. If the
Participant fails to pay the amount demanded, the Company may withhold that
amount from other amounts payable by the Company to the Participant, including
salary, subject to applicable law.
21. Expenses.
The Company will pay all expenses incident to operation of the Plan,
including costs of record keeping, accounting fees, legal fees, custodial fees,
commissions and issue or transfer taxes on purchases pursuant to the Plan and on
delivery of shares to a Participant. The Company will not pay expenses,
commissions or taxes incurred in connection with gifts by a Participant or sales
of shares by the Custodian at the request of a Participant. Expenses to be paid
by a Participant will be deducted from the proceeds of sale prior to remittance.
8
<PAGE>
22. Status of Plan Under Federal Tax Laws.
This Plan is designed to qualify as an employee stock purchase plan under
Code Section 423, and shall be governed and construed accordingly.
23. No Status as Employee.
Neither the action of the Company in establishing this Plan, nor any action
taken under this Plan by the Board or the Plan Administrator, nor any provision
of this Plan itself shall be construed so as to grant any person the right to
remain in the employ of the Company for any period of specific duration.
24. Governing Law.
The provisions of this Plan shall be governed by the laws of the State of
Washington.
Adopted by the Board: July 18, 1997
Approved by the Shareholders: October 8, 1997
Amendment No. 1 adopted by Plan Administrator: August 13, 1998 (attached)
9
AMENDMENT NO. 1 TO
PACIFIC AEROSPACE & ELECTRONICS, INC.
1997 EMPLOYEE STOCK PURCHASE PLAN
The Pacific Aerospace & Electronics, Inc. 1997 Employee Stock Purchase Plan
(the "Plan") is hereby amended as follows:
1. Definition. Section 2(n) is amended to read as follows:
(n) "Offering Period" means, unless otherwise determined by the Plan
Administrator, a one-month period during which Participants may
purchase shares of Common Stock under the Plan.
2. Offering Periods. The first sentence of Section 4 is amended to read
as follows:
Shares of Common Stock will be offered for purchase under this Plan in
a series of Offering Periods, with each Offering Period consisting of
one calendar month.
3. Exercise of Option and Purchase of Shares.
a. The second sentence of Section 8 is amended to read as follows:
Subject to any limitations on the number of shares that may be
purchased as described in the Plan, the maximum number of whole
and fractional shares subject to option will be purchased for the
Participant at the applicable Option Price per Share with the
accumulated deductions in his or her account.
b. The fourth sentence of Section 8 is deleted.
Amendment No. 1 adopted by the Plan Administrator: August 13, 1998.
Exhibit 5.1
October 30, 1998
The Board of Directors
Pacific Aerospace & Electronics, Inc.
Dear Sirs:
We have acted as counsel for Pacific Aerospace & Electronics, Inc. (the
"Company") in connection with the filing of a Registration Statement on Form S-8
(the "Registration Statement") under the Securities Act of 1933, as amended,
relating to the issuance of 1,000,000 shares of Common Stock (the "Shares") of
the Company pursuant to the Company's 1997 Employee Stock Purchase Plan (the
"Plan"). We have reviewed the corporate actions of the Company in connection
with this matter, and we have examined such documents as we deemed necessary
for the purposes of this opinion.
Based on the foregoing, it is our opinion that:
1. The Company is a corporation duly organized and validly existing under
the laws of the State of Washington; and
2. The Shares have been duly authorized, and, when issued in accordance
with the Plan, the Shares will be legally issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ STOEL RIVES LLP
STOEL RIVES LLP
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
Board of Directors
Pacific Aerospace & Electronics, Inc.:
We consent to incorporation by reference into this Form S-8 Registration
Statement of Pacific Aerospace & Electronics, Inc. of our report dated June 30,
1998, relating to the consolidated balance sheet of Pacific Aerospace &
Electronics, Inc. as of May 31, 1998 and the related consolidated statements of
operations, shareholders' equity, and cash flows for the year then ended, which
report appears in the May 31, 1998 annual report on Form 10-K of Pacific
Aerospace & Electronics, Inc.
/s/ KPMG PEAT MARWICK LLP
KPMG Peat Marwick LLP
Seattle, Washington
October 30, 1998
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference into this Form S-8
Registration Statement of our report on the consolidated balance sheet of
Pacific Aerospace & Electronics, Inc. and its subsidiaries as of May 31, 1997,
and the related consolidated statements of operations, shareholders' equity, and
cash flows for each of the years in the two-year period ended May 31, 1997,
which report was included in the Company's 1998 annual report on Form 10-K filed
August 28, 1998.
/s/ MOSS ADAMS LLP
Everett, Washington
October 30, 1998
Exhibit 23.3
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Pacific Aerospace & Electronics, Inc.
We consent to incorporation by reference into this Form S-8 registration
statement of Pacific Aerospace & Electronics, Inc. of our report dated March 19,
1998, relating to the balance sheets of Aeromet International PLC as of December
31, 1997 and 1996 and the related statements of operations, shareholder's
equity, and cash flows for the years then ended, which report appears in the
July 30, 1998 report on Form 8-K of Pacific Aerospace & Electronics, Inc.
Yours faithfully
/s/ KPMG AUDIT PLC
KPMG AUDIT PLC
Birmingham, England
30 October 1998
Exhibit 23.4
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-8 of our report dated
June 27, 1997 relating to the financial statements of Electronic Specialty
Corporation, which appears on page F-1 of the Pacific Aerospace & Electronics,
Inc. Current Report on Form 8-K/A dated August 26, 1998.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
Portland, Oregon
October 30, 1998
Exhibit 24.1
POWER OF ATTORNEY
-----------------
Each of the undersigned hereby constitutes and appoints DONALD A. WRIGHT
and NICK A. GERDE, and each of them, as his true and lawful attorneys-in-fact
and agents, with full power of substitution, for him and in his name, place and
stead, in any and all capacities, to sign any or all amendments or
post-effective amendments to this Registration Statement, and any other
instruments or documents that said attorneys-in-fact and agents may deem
necessary or advisable to enable the Company to comply with the Securities Act
of 1933, as amended ("Securities Act"), and any requirements of the Commission
in respect thereof, and to file the same, with all exhibits thereto, with the
Commission, in connection with the registration under the Securities Act, of
shares of the Company's Common Stock issuable pursuant to the Company's 1997
Employee Stock Purchase Plan, granting unto said attorneys-in-fact and agents
and each of them full power and authority to do and perform each and every act
and thing requisite and necessary to be done, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that each such attorney-in-fact and agent, or his substitute, may lawfully do or
cause to be done by virtue hereof.
Signature Title
/s/ DONALD A. WRIGHT
- ----------------------------- Chief Executive Officer, President and
Donald A. Wright Director (Principal Executive Officer)
/s/ NICK A. GERDE
- ----------------------------- Vice President Finance, Chief Financial
Nick A. Gerde Officer and Treasurer (Principal
Financial and Accounting Officer)
/s/ ALLEN W. DAHL
- ----------------------------- Director
Allen W. Dahl, M.D.
/s/ URS DIEBOLD
- ----------------------------- Director
Dr. Urs Diebold
/s/ WERNER HAFELFINGER
- ----------------------------- Director
Werner Hafelfinger
/s/ DALE L. RASMUSSEN
- ----------------------------- Director
Dale L. Rasmussen
/s/ WILLIAM A. WHEELER
- ----------------------------- Director
William A. Wheeler
