As filed with the Securities and Exchange Commission on May 16, 1997.
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------
MicroAge, Inc.
(Exact name of registrant as specified in its charter)
Delaware 86-0321346
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
2400 South MicroAge Way
Tempe, Arizona 85282
(602) 804-2000
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
----------------
James A. Domaz
Corporate Counsel
MicroAge, Inc.
2400 South MicroAge Way
Tempe, Arizona 85282
(602) 804-2000
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
-----------------
Copy to:
Matthew P. Feeney
Snell & Wilmer L.L.P.
One Arizona Center
Phoenix, Arizona 85004-0001
(602) 382-6239
----------------
Approximate date of commencement of proposed sale to the public: From time to
time after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box: |_|
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: |X|
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering: |_| _________________________
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: |_| __________________________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box: |_|
<PAGE>
-----------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
======================================================================================================
Proposed
Proposed maximum
Title of shares Amount maximum aggregate Amount of
to be registered to be price per offering registration
Registered(1) share(2) price(2) fee
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par value 640,493 $14.375 $9,207,087 $2,791
======================================================================================================
</TABLE>
(1) In the event of a stock split, stock dividend, or similar transaction
involving the Company's Common Stock, in order to prevent dilution, the
number of shares registered shall be automatically increased to cover
the additional shares in accordance with Rule 416(a) under the
Securities Act.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c), based on the last reported sale price of the
Common Stock on May 12, 1997, as reported by Nasdaq National Market.
The Company hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Company 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.
<PAGE>
SUBJECT TO COMPLETION, DATED MAY 16, 1997
PROSPECTUS
640,493 SHARES
MicroAge, Inc.
Common Stock
This Prospectus relates to the offer and sale by Judy C. Flynn
("Selling Stockholder") of 640,493 shares of the Common Stock, $0.01 par value
per share (the "Common Stock"), of MicroAge, Inc., a Delaware corporation (the
"Company"). The Company will not receive any portion of the proceeds from the
sale of the Common Stock offered hereby. The Company's Common Stock is traded on
Nasdaq National Market under the symbol "MICA." On May 15, 1997, the closing
sale price for the Common Stock, as reported by Nasdaq National Market, was
$16.125 per share.
The Selling Stockholder may from time to time effect sales of Common
Stock in one or more transactions pursuant to Rule 144 under the Securities Act
of 1933, as amended (the "Securities Act"), in privately negotiated
transactions, or in ordinary broker's transactions on Nasdaq National Market, at
the price prevailing at the time of such sales, at prices relating to such
prevailing market prices, or at negotiated prices. It is anticipated that any
broker-dealers participating in such sales of securities will receive the usual
and customary selling commissions. The net proceeds to the Selling Stockholder
will be the proceeds received by her upon such sales, less brokerage
commissions. All expenses of registration incurred in connection with this
offering are being borne by the Company. The brokerage and other expenses of
sale incurred by the Selling Stockholder will be borne by the Selling
Stockholder. See "Plan of Distribution" and "Selling Stockholder."
-------------------------------------------
See "Risk Factors" on page 3 for a discussion of certain factors that
should be considered by prospective purchasers of the Common Stock offered
hereby.
-------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
May ____, 1997
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THE COMMON STOCK HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THE COMMON STOCK MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THE COMMON STOCK
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and, in
accordance therewith, files reports, proxy statements, and other information
with the Securities and Exchange Commission (the "Commission"). The reports,
proxy statements, and other information filed by the Company with the Commission
may be inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at
its regional offices located at 7 World Trade Center, 13th Floor, New York, New
York 10048, and Northwestern Atrium Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such material may be obtained from the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. The Commission maintains a web site
(http://www.sec.gov) that contains reports, proxy and information statements,
and other information regarding registrants, such as the Company, that file
electronically with the Commission. In addition, the Company's Common Stock is
traded on Nasdaq National Market. Reports, proxy statements, and other
information filed by the Company are also available for inspection at the
offices of Nasdaq National Market, Reports Section, 1735 K Street, N.W.,
Washington, D.C. 20006.
This Prospectus constitutes a part of a registration statement on Form
S-3 (the "Registration Statement") that the Company has filed with the
Commission under the Securities Act. As permitted by the rules and regulations
of the Commission, this Prospectus omits certain information contained in the
Registration Statement and the exhibits thereto and reference is hereby made to
the Registration Statement and related exhibits for further information with
respect to the Company and the Common Stock offered hereby. Statements contained
in this Prospectus as to the provisions of any documents filed as an exhibit to
the Registration Statement or otherwise filed with the Commission are not
necessarily complete and, in each instance, reference is made to the copy of
such document as so filed. Each such statement is qualified in its entirety by
such reference.
INFORMATION INCORPORATED BY REFERENCE
The following documents have been filed by the Company with the
Commission and are hereby incorporated by reference in this Prospectus: (i) the
Annual Report of the Company on Form 10-K for the fiscal year ended November 3,
1996, and (ii) the Quarterly Report of the Company on Form 10-Q for the fiscal
quarter ended February 2, 1997. All other documents and reports filed by the
Company with the Commission pursuant to Sections 13, 14, or 15(d) of the
Exchange Act subsequent to the date of this Prospectus and prior to the
termination of this offering of the Common Stock shall be deemed to be
incorporated by reference in this Prospectus and to be made a part hereof from
their respective dates of filing.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document that 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 Prospectus.
The Company will cause to be furnished without charge to each person,
including any beneficial owner, to whom this Prospectus is delivered, upon the
written or oral request of such person, a copy of any and all documents
incorporated herein by reference (not including the exhibits to such documents,
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<PAGE>
unless such exhibits are specifically incorporated by reference in the document
which this Prospectus incorporates). Requests should be directed to Investor
Relations, MicroAge, Inc., 2400 South MicroAge Way, Tempe, Arizona 85282;
telephone: (602) 366-2414.
RISK FACTORS
The purchase of the Common Stock offered hereby involves substantial
risk. The following matters, including those mentioned elsewhere, should be
considered carefully by a prospective investor in evaluating a purchase of the
Common Stock.
Intense Competition
The computer reseller industry is characterized by intense competition,
based primarily on product availability, price, speed of delivery, credit
availability, ability to tailor specific solutions to customer needs, quality
and breadth of product lines, service and post-sale support, and quality of
customer training. In addition, the Company faces competition in the recruitment
and retention of franchised and non- franchised resellers. The Company and its
reseller locations compete for sales with numerous other computer resellers,
including (i) master resellers; (ii) direct resellers; (iii) wholesalers
(resellers that do not sell to end-users); (iv) vendors that sell directly to
large purchasers; and (v) parties that implement other sales methods, such as
direct mail, computer "superstores," and mass merchandisers. There can be no
assurance that the Company will not lose market share, or that it will not be
forced in the future to reduce its prices in response to the actions of its
competitors and thereby experience a reduction in its gross margins.
Narrow Margins
The Company has experienced low operating and gross profit margins
caused by intense price competition within its industry. The Company has
partially offset the effect of the low margins by achieving increased revenue
and reduced operating expenses as a percentage of revenue; however, there can be
no assurance that the Company will maintain or increase revenue or further
reduce expenses (as a percentage of revenue) in the future. Future operating and
gross profit margins may be adversely affected by market pressures, the
introduction of new Company initiatives, changes in revenue mix, the Company's
utilization of early payment discount opportunities, vendor pricing actions, and
other competitive and economic pressures.
Dependence on Vendor Incentives and Marketing Development Funds
The Company receives funds from certain vendors which are earned
through marketing programs, meeting established purchasing objectives, or
meeting other objectives determined by the vendor. There can be no assurance
that these programs will be continued by the vendors. A substantial reduction in
the vendor funds available to the Company would have an adverse effect on the
Company's results of operations.
Product Supply; Dependence on Key Vendors
The computer reseller industry continues to experience product supply
shortages and customer order backlogs due to the inability of certain
manufacturers to supply certain products. In addition, certain
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<PAGE>
vendors have initiated new channels of distribution that increase competition
for the available product supply. There can be no assurance that vendors will be
able to maintain an adequate supply of products to fulfill all of the Company's
customer orders on a timely basis. Although the Company has not historically
encountered such conditions, the failure to obtain adequate product supplies, if
competitors were able to obtain them, could have a material adverse effect on
the Company's results of operations.
Three vendors of the Company each represented more than 10% of total
product sales for the year ended November 3, 1996. They were COMPAQ Computer
Corporation ("COMPAQ"), Hewlett-Packard Company ("Hewlett-Packard"), and
International Business Machines Corporation ("IBM"). In 1996, sales of products
from COMPAQ, Hewlett-Packard, and IBM represented 22%, 20%, and 14%,
respectively, of the Company's total product sales. Sales of these three
manufacturers' products represented approximately 56% of the Company's revenue
from product sales during both fiscal 1996 and fiscal 1995.
The Company's agreements with these vendors generally are renewed
periodically and permit termination by the vendor without cause, generally upon
30 to 90 days' notice, depending on the vendor. In addition, the Company's
business is dependent upon price and related terms and product availability
provided by its key vendors. Although the Company considers its relationships
with COMPAQ, Hewlett-Packard, and IBM to be good, there can be no assurance that
these relationships will continue as presently in effect or that changes by one
or more of these key vendors in their volume discount schedules or other
marketing programs would not adversely affect the Company. Termination or
nonrenewal of the Company's agreements with COMPAQ, Hewlett-Packard, or IBM
would have a material adverse effect on the Company's business.
Open Sourcing
In the past, certain of the Company's vendors required resellers to
purchase their products and services exclusively from one source. Vendors have
generally removed this requirement, resulting in "open sourcing" of their
products. To date, open sourcing has significantly contributed to the rapid
growth of the Company's sales to value-added resellers. However, competitive
pricing pressures throughout the industry have intensified; these competitive
pressures have been particularly evident in the Company's distribution business.
During fiscal 1996, 61% of total sales were attributable to the Company's
distribution business and 39% of total sales were attributable to its systems
integration business. While the Company believes that it can effectively compete
for sales of those products available under open sourcing, there can be no
assurance that open sourcing will not adversely affect the Company's business.
Potential Fluctuations in Quarterly Results
The Company's operating results may vary significantly from quarter to
quarter depending on certain factors, including, but not limited to, demand for
the Company's information technology products and services, product
availability, competitive conditions, new product introductions, and general
economic conditions. In particular, the Company's operating results are
sensitive to changes in the mix of product and service revenues, product
margins, inventory adjustments, and interest rates. Although the Company
attempts to control its expense levels, these levels are based, in part, on
anticipated revenues. Therefore, the Company may not be able to control spending
in a timely manner to compensate for any unexpected revenue shortfall. As a
result, quarterly period-to-period comparisons of the Company's financial
results
4
<PAGE>
are not necessarily meaningful and should not be relied upon as an indication of
future performance. In addition, although the Company's financial performance
has not exhibited significant seasonality in the past, the Company and the
computer industry in general tend to follow a sales pattern with peaks occurring
near the end of the calendar year, due primarily to special vendor promotions
and year-end business purchases.
Risk of Declines in Inventory Value
The Company's business is subject to the risk that the value of its
inventory will be adversely affected by price reductions by suppliers or by
technological changes affecting the usefulness or desirability of the products
comprising the inventory. It is the policy of most suppliers of the Company's
products to protect distributors such as the Company, who purchase directly from
such suppliers, from the loss in value of inventory due to technological change
or the supplier's price reductions. Under the terms of many of the Company's
distribution agreements, suppliers will credit the Company for inventory losses
resulting from the supplier's price reductions if the Company complies with
certain conditions. In addition, under many of the Company's agreements, the
Company has the right to return for credit or exchange for other products a
portion of the inventory items purchased, within a designated period of time.
Since the Company can only return a portion of its inventory, the Company could
be forced to liquidate nonreturnable aged inventory at prices below the
Company's cost. A supplier who elects to terminate a distribution agreement may
repurchase from the distributor the supplier's products carried in the
distributor's inventory. The industry practices discussed above are sometimes
not embodied in written agreements and do not protect the Company in all cases
from declines in inventory value. No assurance can be given that such practices
will continue, that unforeseen new product developments will not materially
adversely affect the Company, or that the Company will be able to successfully
manage its existing and future inventories. The Company establishes reserves for
estimated losses due to obsolete inventory in the normal course of business.
Historically, the Company has not experienced losses due to obsolete inventory
materially in excess of established inventory reserves. However, significant
declines in inventory value in excess of established inventory reserves could
materially adversely affect the Company's business, financial condition, or
results of operations.
No Assurance of Successful Acquisitions
In order to establish or solidify its presence in strategic markets or
in response to competitive pressures, the Company has made, and in the future
may make, acquisitions of or investments in additional reseller locations. Any
acquisitions by the Company may result in potentially dilutive issuances of
equity securities, the incurrence of additional debt, and amortization of
expenses related to goodwill and intangible assets, all of which could adversely
effect the Company's profitability. Acquisitions involve numerous risks, such as
the diversion of the attention of the Company's management from other business
concerns, the entrance of the Company into markets in which it has had no or
only limited experience, the integration of the acquired companies' management
information systems with those of the Company, and the potential loss of key
employees of the acquired companies, all of which could have a material adverse
effect on the Company's business, financial condition, or results of operations.
Capital Intensive Nature of Business
The Company's business requires significant levels of capital to
finance accounts receivable and product inventory that is not financed by trade
creditors. The Company has financed its growth and cash
5
<PAGE>
needs to date primarily through working capital financing facilities, bank
credit lines, common stock offerings, and cash generated from operations. The
primary uses of cash have been to fund increases in inventory and accounts
receivable resulting from increased sales. If the Company is successful in
achieving continued revenue growth, its working capital requirements will
continue to increase.
The Company maintains three primary financing agreements (the
"Financing Agreements") with an aggregate borrowing capacity of $675 million.
The Financing Agreements expire in August 1998, but any of the Financing
Agreements may be terminated 90 days after either party gives the other party
notice of termination. At May 4, 1997, the Company had approximately $367
million outstanding under the Financing Agreements. Of the $675 million of
borrowing capacity represented by the Financing Agreements, $308 million was
unused as of May 4, 1997. Utilization of the unused $308 million is dependent
upon, among other things, the Company's collateral availability at the time the
funds would be needed.
The unavailability of a significant portion of, or the loss of, the
Financing Agreements or trade credit from vendors would have a material adverse
effect on the Company. There can be no assurance that the Company will be able
to borrow adequate amounts on terms acceptable to the Company.
Dependence on Information Systems
The Company depends on a variety of information systems for its
operations, particularly its centralized information processing system which
supports, among other things, inventory management, order processing, shipping,
receiving, and accounting. Although the Company has not in the past experienced
significant failures or down time of its centralized information processing
system or any of its other information systems, any such failure or significant
down time could prevent the Company from taking customer orders, printing
product pick-lists, and/or shipping product and could prevent customers from
accessing price and product availability information from the Company. In such
event, the Company could be at a severe disadvantage in determining appropriate
product pricing or the adequacy of inventory levels or in reacting to rapidly
changing market conditions. A failure of the Company's information systems which
impacts any of these functions could have a material adverse effect on the
Company's business, financial condition, or results of operations. In addition,
the inability of the Company to attract and retain the highly-skilled personnel
required to implement, maintain, and operate its centralized information
processing system and the Company's other information systems could have a
material adverse effect on the Company's business, financial condition, or
results of operations. In order to react to changing market conditions, the
Company must continuously expand and improve its centralized information
processing system and its other information systems. There can be no assurance
that the Company's information systems will not fail, that the Company will be
able to attract and retain qualified personnel necessary for the operation of
such systems, or that the Company will be able to expand and improve its
information systems.
Dependence on Independent Shipping Companies
The Company relies almost entirely on arrangements with independent
shipping companies for the delivery of its products. Products are shipped from
suppliers to the Company through a variety of independent common carriers.
Currently, United Parcel Service ("UPS") delivers the substantial majority of
the Company's products to its reseller customers. The termination of the
Company's arrangements with UPS or other independent shipping companies, or the
failure or inability of one or more of these
6
<PAGE>
independent shipping companies to deliver products from suppliers to the
Company, or products from the Company to its reseller customers or their
end-user customers could have a material adverse effect on the Company's
business, financial condition, or results of operations. For instance, an
employee work stoppage or slow-down at one or more of these independent shipping
companies could materially impair that shipping company's ability to perform the
services required by the Company. There can be no assurance that the services of
any of these independent shipping companies will continue to be available to the
Company on terms as favorable as those currently available or that these
companies will choose or be able to perform their required shipping services for
the Company.
Rapid Technological Change
The Company's industry is subject to rapid technological change, new
and enhanced product specification requirements, and evolving industry
standards. These changes may cause inventory and stock to decline substantially
in value or to become obsolete. In addition, suppliers may give the Company
limited or no access to new products being introduced. Although the Company
believes that it has adequate price protection and other arrangements with its
suppliers to avoid bearing the costs associated with these changes, no assurance
can be made that future technological or other changes will not have a material
adverse effect on the business, financial condition, or results of operations of
the Company. See "-Risk of Declines in Inventory Value."
Possible Volatility of Stock Price
The market price of the Common Stock could be subject to wide
fluctuations in response to quarterly variations in the Company's results of
operations, changes in earnings estimates by research analysts, conditions in
the computer industry, or general market or economic conditions, among other
factors. In addition, in recent years the stock market has experienced
significant price and volume fluctuations. These fluctuations have had a
substantial effect on the market prices of many technology companies, often
unrelated to the operating performance of the specific companies. Such market
fluctuations could materially adversely affect the market price for the Common
Stock.
Disclosure Regarding Forward-Looking Statements
This Prospectus, including all documents incorporated herein by
reference, contains forward- looking statements. Additional written or oral
forward-looking statements may be made by the Company from time to time in
filings with the Commission or otherwise. The words "believe," "expect,"
"anticipate," "estimate," "project," and similar expressions identify
forward-looking statements. Such forward-looking statements are within the
meaning of that term in Section 27A of the Securities Act and Section 21E of the
Exchange Act. Such statements may include, but not be limited to, projections of
revenues, income, or loss, capital expenditures, acquisitions, plans for future
operations, financing needs or plans, the impact of inflation and plans relating
to products or services of the Company, as well as assumptions relating to the
foregoing. Forward-looking statements are inherently subject to risks and
uncertainties, some of which cannot be predicted or quantified. Future events
and actual results could differ materially from those set forth in, contemplated
by, or underlying the forward-looking statements. Statements in this Prospectus,
including those set forth above, describe factors, among others, that could
contribute to or cause such differences.
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<PAGE>
USE OF PROCEEDS
All 640,493 shares of Common Stock offered hereby are being offered by
the Selling Stockholder. The Company will not receive any proceeds from the sale
of Common Stock by the Selling Stockholder.
SELLING STOCKHOLDER
On January 15, 1997, a subsidiary of the Company merged with and into
Advanced Systems Consultants, Inc. ("ASC") pursuant to an Agreement and Plan of
Reorganization, dated January 14, 1997 (the "Agreement"). Prior to the merger,
ASC was one of the Company's reseller locations and purchased substantial
amounts of the Company's products for resale to its customers. At the time of
the merger, the Selling Stockholder owned all of the issued and outstanding
shares of the capital stock of ASC. As a result of the merger, ASC became a
wholly-owned subsidiary of the Company and the Selling Stockholder's shares of
ASC common stock were automatically canceled and extinguished and were converted
into 640,493 shares of the Company's Common Stock. Under the Agreement, the
Company is required to register for public sale those shares of Common Stock
issued to the Selling Stockholder. This Prospectus is a part of the Registration
Statement filed by the Company in order to satisfy this requirement. In
addition, in connection with the Agreement, the Company entered into a one-year
Employment Agreement with the Selling Stockholder pursuant to which she is paid
an annual base salary of $120,000.
The following table provides certain information with respect to the
Common Stock owned by the Selling Stockholder as of May 14, 1997.
Percentage of Percentage of
No. of Shares Common Stock Common Shares
of Common Owned Prior to No. of Common Owned After the
Stock Owned Offering(1) Shares Offered Offering(2)
----------- ----------- -------------- -----------
640,493 4.1% 640,493 0%
- ----------
(1) Includes all shares of Common Stock beneficially owned by the Selling
Stockholder as a percentage of the 15,481,129 shares of Common Stock
outstanding at May 14, 1997.
(2) Assumes that Selling Stockholder disposes of all the shares of Common
Stock covered by this Prospectus and does not acquire any additional
shares of Common Stock.
PLAN OF DISTRIBUTION
This Prospectus relates to the sale of 640,493 shares of Common Stock
by Selling Stockholder. The Selling Stockholder may from time to time effect
sales of Common Stock in one or more transactions pursuant to Rule 144 under the
Securities Act, in privately negotiated transactions, or in ordinary broker's
transactions on Nasdaq National Market, at the price prevailing at the time of
such sales, at prices relating to such prevailing market prices, or at
negotiated prices. It is anticipated that any broker-dealers participating in
such sales of securities will receive the usual and customary selling
commissions.
8
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The Company will pay all of the expenses incident to the registration
of the Common Stock offered hereby, other than commissions and selling expenses
with respect to the Common Stock being sold by the Selling Stockholder.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for
the Company by Snell & Wilmer L.L.P., One Arizona Center, Phoenix, Arizona
85004.
EXPERTS
The consolidated financial statements incorporated in this Prospectus
by reference to the Annual Report on Form 10-K for the fiscal year ended
November 3, 1996, have been so incorporated in reliance on the report of Price
Waterhouse LLP, independent accountants, given on the authority of such firm as
experts in auditing and accounting.
9
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======================================== ====================================
No dealer, salesperson, or other person
has been authorized in connection with
this offering to give any information or
to make any representations other than
those contained in this Prospectus and, MicroAge, Inc.
if given or made, such information or
representations must not be relied upon
as having been authorized by the
Company. Neither the delivery of this 640,493
Prospectus nor any sale made hereunder
shall, under any circumstances, create Shares
any implication that there has been no of
change in the affairs of the Company Common Stock
since the date hereof or that the
information contained herein is correct
as of any date subsequent to the date
hereof. This Prospectus does not
constitute an offer to sell or a
solicitation of an offer to buy any of
the securities offered hereby by anyone
in any jurisdiction in which it is
unlawful to make such offer or
solicitation.
TABLE OF CONTENTS
Page
----
Available Information..................2
Information Incorporated by
Reference..............................2 PROSPECTUS
Risk Factors...........................3
Use of Proceeds........................8
Selling Stockholder....................8
Plan of Distribution...................8
Legal Matters..........................9
Experts................................9
May ___, 1997
======================================== ====================================
10
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following sets forth the expenses to be borne by the registrant in
connection with the offering being registered hereby.
Securities and Exchange Commission Registration Fee................. $ 2,791
Printing and Engraving Expenses..................................... $ 2,000
Legal Fees and Expenses............................................. $ 12,000
Accounting Fees and Expenses........................................ $ 8,000
Blue Sky Fees and Expenses.......................................... $ 1,000
Other Expenses...................................................... $ 1,209
----------
Total Expenses............................................. $ 27,000
==========
Item 15. Indemnification of Directors and Officers
Reference is made to Section 145 of the Delaware General Corporation
Law (the "Delaware GCL"), as amended from time to time ("Section 145"), which
provides for indemnification of directors and officers of a corporation in
certain circumstances. Under Article IX of the registrant's Restated Certificate
of Incorporation, as amended, the registrant shall, to the full extent permitted
by Section 145, indemnify all persons whom it may indemnify pursuant thereto.
Additionally, Article IX provides, among other matters, that the right to
indemnification is a contract right, that the registrant is expressly authorized
to procure insurance, that advancement of expenses by the registrant is
mandatory (except as limited by law) and for certain procedural mechanisms for
the benefit of indemnified parties.
Article VII of the By-Laws of the registrant provides for
indemnification of directors and officers of the registrant. The provisions of
Article VII, among other matters, require the registrant to indemnify certain
persons to the fullest extent authorized by the Delaware GCL, as the same may
now exist or may hereafter be amended (but, in the case of any such amendment,
only to the extent that such amendment permits the registrant to provide broader
indemnification rights than such law permitted the registrant to provide prior
to such amendment). Article VII provides that the right to indemnification is a
contract right and makes advances of expenses incurred in defending a proceeding
mandatory, provided that if required by the Delaware GCL, the person seeking
such advances furnishes an undertaking to the registrant to repay all amounts so
advanced if it shall be determined by a final adjudication that the person who
received such expenses is not entitled to be indemnified. Article VII also
expressly provides that any person claiming indemnification may sue the
registrant for payment of amounts due, that the registrant in such case will
have the burden of proving that the claimant has not met the standards of
conduct which make it permissible to indemnify the person for the amount claimed
under the Delaware GCL (except in the case of a claim for advancement of
expenses, where the required undertaking, if any, has been tendered, in which
case it shall not be a defense that the person has not met the applicable
standards of conduct) and that neither the failure by the registrant to have
made a determination that indemnification is proper, nor an actual determination
by the registrant that the claimant has not met the applicable standard of
conduct, is a defense to the action or creates a presumption that the claimant
has not met the applicable standards of conduct.
II-1
<PAGE>
The registrant has entered into indemnity agreements with certain of
its directors and its officers supplementing the indemnification available under
the Delaware GCL and the registrant's Restated Certificate of Incorporation and
By-Laws (as described above). The indemnification agreements provide that the
registrant will pay any amount which the indemnified party is legally obligated
to pay because of claims made against the indemnified party based on any act,
omission, neglect or breach of duty (whether occurring prior to or after the
date of the indemnity agreements), while acting in his capacity as a director or
officer. The payments to be made under the indemnity agreements include the
amounts of all claims, damages, judgments, settlements and costs of defense of
legal actions, claims or proceedings and appeals therefrom, and costs of
attachment or similar bonds. However, if it is determined that such director or
officer was not entitled to be indemnified in full or in part, such officer or
director must repay such amount to the registrant. The indemnity agreements also
cover claims made after the end of an indemnified party's service as an officer
or director, but which relate to acts, omissions, or breaches of duty which
occurred while serving as an officer or director.
The registrant currently maintains directors' and officers' liability
insurance to supplement the protection provided in the registrant's Restated
Certificate of Incorporation, as amended, its By-Laws, and indemnification
agreements with its directors and officers, and to fund certain payments that
the registrant may be required to make under any such provisions. Such insurance
is renewable annually and is subject to standard terms and conditions, including
exclusions from coverage.
II-2
<PAGE>
Item 16. Exhibits
Exhibit
Number Description
- ------ -----------
4.1 Restated Certificate of Incorporation of the Company(1)
4.2 By-Laws of the Company, amended and restated as of April 3,
1997(2)
4.3 Specimen Common Stock Certificate (3)
4.4 Amended and Restated Rights Agreement dated as of September
28, 1994 between MicroAge, Inc. and First Interstate Bank of
California(4)
4.4.1 First Amendment dated as of November 5, 1996 between MicroAge,
Inc. and American Stock Transfer and Trust Company to Amended
and Restated Rights Agreement dated as of September 28, 1994,
between MicroAge, Inc. and First Interstate Bank of
California(5)
5 Opinion of Snell & Wilmer L.L.P.
23.1 Consent of Price Waterhouse LLP
23.2 Consent of Snell & Wilmer L.L.P. (included in Exhibit 5)
24 Power of Attorney (included in signature page)
- -----------------------
(1) Incorporated by reference to Exhibit 3.1 to the Company's Quarterly Report
on Form 10-Q for the fiscal quarter ended May 1, 1994.
(2) Incorporated by reference to Exhibit 4.1 to the Company's Registration
Statement No. 333-26247.
(3) Incorporated by reference to Exhibit 4.1 to the Company's Registration
Statement No. 33-45510.
(4) Incorporated by reference to Exhibit 1.1 of the Company's Form 8-A, filed
January 13, 1994.
(5) Incorporated by reference to Exhibit 4.2.1 to the Company's Annual Report
on Form 10-K for the fiscal year ended November 3, 1996.
II-3
<PAGE>
Item 17. Undertakings
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed int he
registration statement or any material change to such information
in the registration statement;
provided, however, that paragraphs (1)(i) and (l)(ii) above do not
apply if the registration statement is on Form S-3, Form S-8 or Form
F-3, and the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
with or furnished to the Commission by the registrant pursuant to
Section 13 or 15(d)a of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-4
<PAGE>
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions described in Item 15 above, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission, such indemnification is against public policy as
expressed in the 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 Act and will
be governed by the final adjudication of such issue.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Tempe, State of Arizona, on May 16, 1997.
MICROAGE, INC.,
a Delaware corporation
By: /s/ Jeffrey D. McKeever
------------------------------------
Jeffrey D. McKeever
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Each person whose signature appears below
hereby authorizes Jeffrey D. McKeever and James R. Daniel, and each of them, as
attorneys-in-fact, to sign his or her name on his or her behalf, individually
and in each capacity designated below, and to file any amendments, including
post-effective amendments to this Registration Statement.
II-6
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Jeffrey D. McKeever Director, Chairman of the Board and Chief May 16, 1997
- ----------------------------------- Executive Officer (Principal Executive Officer)
Jeffrey D. McKeever
/s/ William H. Mallender Director May 16, 1997
- -----------------------------------
William H. Mallender
/s/ Steven G. Mihaylo Director May 16, 1997
- -----------------------------------
Steven G. Mihaylo
Director May 16, 1997
- -----------------------------------
Fred Israel
/s/ Linda M. Applegate Director May 16, 1997
- -----------------------------------
Linda M. Applegate
/s/ Roy A. Herberger, Jr. Director May 16, 1997
- -----------------------------------
Roy A. Herberger, Jr.
/s/ James R. Daniel Senior Vice President, Chief Financial Officer May 16, 1997
- ----------------------------------- and Treasurer (Principal Financial Officer)
James R. Daniel
/s/ Raymond L. Storck Vice President - Controller and Assistant May 16, 1997
- ----------------------------------- Treasurer (Principal Accounting Officer)
Raymond L. Storck
</TABLE>
II-7
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------ -----------
4.1 Restated Certificate of Incorporation of the Company(1)
4.2 By-Laws of the Company, amended and restated as of April 3,
1997(2)
4.3 Specimen Common Stock Certificate (3)
4.4 Amended and Restated Rights Agreement dated as of September
28, 1994 between MicroAge, Inc. and First Interstate Bank of
California(4)
4.4.1 First Amendment dated as of November 5, 1996 between MicroAge,
Inc. and American Stock Transfer and Trust Company to Amended
and Restated Rights Agreement dated as of September 28, 1994,
between MicroAge, Inc. and First Interstate Bank of
California(5)
5 Opinion of Snell & Wilmer L.L.P.
23.1 Consent of Price Waterhouse LLP
23.2 Consent of Snell & Wilmer L.L.P. (included in Exhibit 5)
24 Power of Attorney (included in signature page)
- -----------------------
(1) Incorporated by reference to Exhibit 3.1 to the Company's Quarterly Report
on Form 10-Q for the fiscal quarter ended May 1, 1994.
(2) Incorporated by reference to Exhibit 4.1 to the Company's Registration
Statement No. 333-26247.
(3) Incorporated by reference to Exhibit 4.1 to the Company's Registration
Statement No. 33- 45510.
(4) Incorporated by reference to Exhibit 1.1 of the Company's Form 8-A, filed
January 13, 1994.
(5) Incorporated by reference to Exhibit 4.2.1 to the Company's Annual Report
on Form 10-K for the fiscal year ended November 3, 1996.
II-8
May 16, 1997
MicroAge, Inc.
2400 South MicroAge Way
Tempe, Arizona 85282-1896
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
In connection with the Registration Statement on Form S-3, including
amendments and exhibits thereto (the "Registration Statement"), for the proposed
offer and sale of up to 640,493 shares of Common Stock (the "Shares") of
MicroAge, Inc. (the "Company") by Ms. Judy C. Flynn, it is our opinion that the
Shares are validly issued, fully paid, and nonassessable.
In rendering this opinion, we have examined the Certificate of
Incorporation, as amended, and the By-Laws, as amended, of the Company, the
Articles of Merger of Advanced Systems Consultants, Inc. and Flynnco, Inc., a
wholly-owned subsidiary of the Company (the "Articles of Merger"), the
proceedings of the Board of Directors of the Company and Flynnco, Inc.,
authorizing the Articles of Merger, and such other documents and records of the
Company as we have deemed necessary. In addition, we have assumed the following:
(i) the genuineness of all signatures and the authenticity of documents
submitted to us as originals, and the conformity to originals of all documents
submitted to us as copies;
(ii) the accuracy, completeness, and genuineness of all representations
and certifications, with respect to factual matters, made to us by officers of
the Company and public officials; and
(iii) the accuracy and completeness of Company records.
The opinions expressed herein are based upon the law and other matters
in effect on the date hereof, and we assume no obligation to revise or
supplement this opinion should such law be changed by legislative action,
judicial decision, or otherwise, or should any facts or other matters upon which
we have relied be changed.
<PAGE>
MicroAge, Inc.
May 16, 1997
Page 2
This opinion is intended solely for the use of the Company in
connection with the registration of the Shares. It may not be relied upon by any
other person or for any other purpose, or reproduced or filed publicly by any
person without the prior written consent of this firm; provided, however,
consent is hereby given to the use of this opinion as part of the Registration
Statement and to the use of our name wherever it appears in said Registration
Statement.
Very truly yours,
/s/ Snell & Wilmer L.L.P.
Exhibit 23.1
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
December 11, 1996 appearing in MicroAge, Inc.'s Annual Report on Form 10-K for
the fiscal year ended November 3, 1996. We also consent to the reference to us
under the heading "Experts" in such Prospectus.
PRICE WATERHOUSE LLP
Phoenix, Arizona
May 16, 1997
