As filed with the Securities and Exchange Commission on June 29, 1999
Registration No. 333-__________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
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 of (I.R.S. Employer
incorporation or organization) Identification No.)
2400 South Microage Way, Tempe, Arizona 85252-1896
(Address of Principal Executive Offices)(Zip Code)
MICROAGE, INC. 1995 ASSOCIATE STOCK PURCHASE PLAN,
AS AMENDED
(Full Title of the Plan)
James H. Domaz Copy To:
Vice President and Corporate Counsel Matthew P. Feeney
Microage, Inc. Snell & Wilmer L.L.P.
2400 South Microage Way One Arizona Center
Tempe, Arizona 85282-1896 Phoenix, Arizona 85004-0001
(Name and address of agent for service)
(602) 366-2000
(Telephone number, including area code, of agent for service)
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CALCULATION OF REGISTRATION FEE
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PROPOSED PROPOSED
TITLE OF MAXIMUM MAXIMUM
SECURITIES AMOUNT OFFERING AGGREGATE AMOUNT OF
TO BE TO BE PRICE OFFERING REGISTRATION
REGISTERED REGISTERED PER SHARE(1) PRICE(1) FEE(2)
- --------------------------------------------------------------------------------
Common Stock
($.01 Par Value per share) 500,000 $4.25 $2,125,000 $591
================================================================================
- ----------
1 Estimated solely for the purpose of calculating the amount of the
registration fee, pursuant to Rules 457(c) and 457(h) of the Securities Act
of 1933 (the "Securities Act"), on the basis of the average of the high and
low prices for shares of Common Stock on June 24, 1999.
2 Pursuant to Rule 429 of the rules and regulations under the Securities Act
of 1933, this Registration Statement contains a combined prospectus
relating to the 500,000 shares registered hereby and 500,000 shares
registered on April 28, 1995, pursuant to Registration Statement No.
33-58901. The previously paid filing fees associated with the referenced
securities registered under Registration Statement No. 33-58901 are
$1,629.18.
2
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PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information specified in Part I, Items 1
and 2, will be delivered to plan participants in accordance with Form S-8 and
Rule 428 of the Securities Act.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
The following documents have been filed by MicroAge, Inc. (the
"Registrant") with the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934 and are incorporated herein by reference:
1. Annual Report on Form 10-K for the fiscal year ended November 1,
1998;
2. Quarterly Report on Form 10-Q for the fiscal quarter ending
January 1, 1999;
3. Quarterly Report on Form 10-Q for the fiscal quarter ending May
2, 1999;
4. Form 8-K dated February 19, 1999;
5. The description of the Registrant's Common Stock included in
Registration Statements on Form 8-A dated June 12, 1987 (as
amended on August 5, 1993, March 28, 1994, December 30, 1994),
and the description of the Registrant's Rights to Purchase Series
C Junior Participating Preferred Stock on Form 8-A, dated
December 30, 1994, as amended on April 4, 1999.
All documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14, and 15(d) of the Securities Exchange Act of 1934,
prior to the filing of a post-effective amendment to this Registration Statement
which indicates that all securities offered have been sold or which deregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference in this Registration Statement and to be a part hereof from the date
of filing such documents. 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 Registration Statement to the extent that a
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statement contained herein or in any subsequently filed document which also is
or is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any 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.
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, and Article VII of the By-laws of the Registrant,
the Registrant shall, to the fullest extent permitted by Section 145, indemnify
all persons whom it may indemnify pursuant thereto. The provisions of Article
VII of the By-laws of the Registrant and Article IX of the Registrant's Restated
Certificate of Incorporation, among other matters, require the Registrant to
indemnify certain persons to the fullest extent authorized by the Delaware GCL,
as the same exists 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 of the By-laws of the Registrant
and Article IX of the Registrant's Restated Certificate of Incorporation provide
that the right to indemnification is a contract right and that advances of
expenses incurred in defending a proceeding are 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 of the By-laws of the Registrant and
Article IX of the Registrant's Restated Certificate of Incorporation also
expressly provide 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 standard of conduct.
The Registrant currently maintains directors' and officers' liability
insurance to supplement the protection provided in the Registrant's Restated
Certificate of Incorporation, as amended and its By-laws and to fund certain
payments that the Registrant may be required to make under any such provisions.
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Such insurance is renewable annually and is subject to standard terms and
conditions, including exclusions from coverage.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED. NOT APPLICABLE.
ITEM 8. EXHIBITS.
Exhibit
No. Description
- ------- -----------
4.1 Restated Certificate of Incorporation of MicroAge, Inc. (Incorporated by
reference to Exhibit 3.1 to the Quarterly Report on Form 10-Q for the
quarter ended May 1, 1994)
4.2 By-Laws of MicroAge, Inc., amended and restated as of July 16, 1998
(Incorporated by reference to Exhibit 4.2 to Registration Statement No.
333-62763, filed on September 2, 1998)
4.3.1 Amended and Restated Rights Agreement, dated as of September 28, 1994,
between MicroAge, Inc. and First Interstate Bank of California
(Incorporated by reference to Exhibit 1.1 to the Form 8-A filed January
13, 1994)
4.3.2 First Amendment, dated as of November 5, 1996, by and 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 (Incorporated by
reference to Exhibit 4.2.1 to the Annual Report on Form 10-K for year
ended November 3, 1996)
4.3.3 Second Amendment, dated January 28, 1999, by and 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. (Incorporated by reference to
Exhibit 4.2.3 to the Registration Statement on Form S-8 for year filed
March 3, 1999)
5 Opinion of Snell & Wilmer L.L.P.
23.1 Consent of PricewaterhouseCoopers LLP
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23.2 Consent of Snell & Wilmer L.L.P. (included in the opinion filed as
Exhibit 5).
24 Power of Attorney (included in signature pages).
99.1 MicroAge, Inc., 1995 Associate Stock Purchase Plan, as amended.
ITEM 9. UNDERTAKINGS.
(a) 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 in the
registration statement or any material change to such
information 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.
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(b) 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 Section 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.
(c) 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 foregoing provisions, 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 of 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.
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SIGNATURES
THE REGISTRANT. 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-8 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 June 29, 1999.
MICROAGE, INC.
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 date 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 additional amendments,
including post-effective amendments to this Registration Statement.
SIGNATURE TITLE DATE
/s/ Jeffrey D. McKeever Director, June 29, 1999
- ---------------------------- Chairman of the Board and
Jeffrey D. McKeever Chief Executive Officer
(Principal Executive Officer)
/s/ Lynda M. Applegate
- ----------------------------
Lynda M. Applegate Director June 29, 1999
/s/ Cyrus F. Freidheim, Jr.
- ----------------------------
Cyrus F. Freidheim, Jr. Director June 29, 1999
/s/ Roy A. Herberger, Jr.
- ----------------------------
Roy A. Herberger, Jr. Director June 29, 1999
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/s/ William H. Mallender
- ----------------------------
William H. Mallender Director June 29, 1999
/s/ Steven G. Mihaylo
- ----------------------------
Steven G. Mihaylo Director June 29, 1999
/s/ Dianne C. Walker
- ----------------------------
Dianne C. Walker Director June 29, 1999
/s/ James R. Daniel Executive Vice President, June 29, 1999
- ---------------------------- Chief Financial Officer
James R. Daniel and Treasurer
(Principal Financial Officer)
/s/ Raymond L. Storck Vice President - Controller June 29, 1999
- ---------------------------- and Assistant Treasurer
Raymond L. Storck (Principal Accounting Officer)
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EXHIBIT 5
June 29, 1999
MICROAGE, INC.
2400 South MicroAge Way
Tempe, AZ 85282
Ladies and Gentlemen:
Reference is made to your proposed offering pursuant to the Amended and
Restated MicroAge, Inc. 1995 Associate Stock Purchase Plan (the "Plan") of up to
500,000 shares of the Registrant's Common Stock, $.01 par value (the "Plan
Shares"), as contemplated in the Registration Statement on Form S-8 and the
Exhibits thereto to be filed by the Registrant with the Securities and Exchange
Commission (the "SEC"), under the Securities Act of 1933, as amended, on June
29, 1999 (the "Registration Statement"). It is our opinion that:
1. The Registrant has been duly organized and is validly existing as
a corporation under the laws of the State of Delaware.
2. The Plan Shares, when issued and sold in accordance with the
terms of the Plan, will be legally issued, fully paid, and
non-assessable.
In rendering this opinion, we have reviewed and relied upon such
documents and records of the Registrant as we have deemed necessary and 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 Registrant and public officials; and
(iii) the accuracy and completeness of Registrant's records.
The opinions expressed herein are limited solely to the laws of the
State of Delaware. We express no opinion on the laws of any other jurisdiction
or the applicability or effect of any such laws or principles.
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,
<PAGE>
judicial decision, or otherwise, or should any facts or other matters upon which
we have relied be changed.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
SNELL & WILMER L.L.P.
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 8, 1999 appearing in MicroAge,
Inc.'s Annual Report on Form 10-K for the fiscal year ended November 1, 1998.
/s/ PricewaterhouseCoopers LLP
Phoenix, Arizona
June 29, 1999
MICROAGE, INC.
1995 ASSOCIATE STOCK PURCHASE PLAN
1. PURPOSE. The purpose of this 1995 Associate Stock Purchase Plan (the
"Plan") is to encourage stock ownership by associates of MicroAge, Inc. (the
"Company") and its Subsidiaries and thereby provide associates with an incentive
to contribute to the profitability and success of the Company. The Plan is
intended to qualify as an "employee stock purchase plan" under Section 423 of
the Code and will be maintained for the exclusive benefit of eligible associates
of the Company and its Subsidiaries.
2. DEFINITIONS. For purposes of the Plan, in addition to the terms
defined in Section 1, terms are defined as set forth below:
(a) "Board" means the Board of Directors of the Company.
(b) "Cash Account" means the account maintained on behalf of the
Participant by the Custodian for the purpose of holding cash contributions
pending investment in Stock.
(c) "Code" means the Internal Revenue Code of 1986, as amended.
(d) "Custodian" means Peacock, Hislop, Staley & Given, Inc. or the
successor thereto as may be appointed by the Board.
(e) "Earnings" means a Participant's salary or wages for services
performed for the Company and its Subsidiaries and received by a Participant for
services rendered during a specified pay period.
(f) "Enrollment Period" means the two-week period immediately prior to
each Subscription Period.
(g) "Fair Market Value" means the closing price for Shares on the
relevant date as reported on the NASDAQ National Market System (or any national
securities exchange on which the Shares are then listed), or (if there were no
sales on such date) the closing price on the next preceding date for which a
closing price was reported.
(h) "Participant" means an associate of the Company or a Subsidiary who
is participating in the Plan.
(i) "Purchase Date" means the fifth business day after the end of each
Subscription Period.
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(j) "Purchase Right" means a Participant's option to purchase shares
which is deemed to be outstanding during a Subscription Period. A Purchase Right
represents an "option" as such term is used under Section 423 of the Code.
(k) "Stock" means the Common Stock of the Company, and such other
securities as may be substituted for Stock under Section 4.
(l) "Stock Account" means the account maintained on behalf of the
Participant by the Custodian for the purpose of holding Stock acquired upon
investment under the Plan.
(m) "Subscription Period" means the six-month period beginning on
January 1 and July 1 of each year, with the first Subscription Period to begin
on July 1, 1995.
(n) "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if each of the
corporations (other than the last corporation in the unbroken chain) owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in the chain.
3. ADMINISTRATION.
(a) Board Administration. The Plan will be administered by the Board.
The Board may delegate its administrative duties and authority (other than
authority to amend the Plan) to any Board committee or to any officers or
associates or committee thereof as the Board may designate (in which case
references to the Board will be deemed to mean the administrator to which such
duties and authority have been delegated). The Board will have full authority to
adopt, amend, suspend, waive, and rescind such rules and regulations and appoint
such agents as it may deem necessary or advisable to administer the Plan, to
correct any defect or supply any omission or reconcile any inconsistency in the
Plan and to construe and interpret the Plan and rules and regulations
thereunder, to furnish to the Custodian such information as the Custodian may
require, and to make all other decisions and determinations under the Plan
(including determinations relating to eligibility). No person acting in
connection with the administration of the Plan will, in that capacity,
participate in deciding any matter relating to his or her participation in the
Plan.
(b) The Custodian. The Custodian will act as custodian under the Plan,
and will perform such duties as are set forth in the Plan and in any agreement
between the Company and the Custodian. The Custodian will establish and
maintain, as agent for Participants, Cash and Stock Accounts and any other
subaccounts as may be necessary or desirable for the administration of the Plan.
(c) Waivers. The Board may waive or modify any requirement that a
notice or election be made or filed under the Plan a specified period in advance
in an individual case or by adopting a rule or regulation under the Plan,
without amending the Plan.
(d) Other Administrative Provisions. The Company will furnish
information from its records as directed by the Board, and such records,
including a Participant's Earnings, will be conclusive on all persons unless
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determined by the Board to be incorrect. Each Participant and other person
claiming benefits under the Plan must furnish to the Company in writing an
up-to-date mailing address and any other information as the Board or Custodian
may reasonably request. Any communication, statement, or notice mailed with
postage prepaid to any such Participant or other person at the last mailing
address filed with the Company will be deemed sufficiently given when mailed and
will be binding upon the named recipient. The Plan will be administered on a
reasonable and nondiscriminatory basis and uniform rules will apply to all
persons similarly situated. All Participants will have equal rights and
privileges (subject to the terms of the Plan) with respect to Purchase Right
outstanding during any given Subscription Period.
4. STOCK SUBJECT TO PLAN. Subject to adjustment as provided below, the
total number of shares of Stock reserved and available for issuance or which may
be otherwise acquired upon exercise of Purchase Rights under the Plan will be
1,000,000. Any shares of Stock delivered by the Company under the Plan may
consist, in whole or in part, of authorized and unissued shares or treasury
shares. The number and kind of such shares of Stock subject to the Plan will be
proportionately adjusted, as determined by the Board, in the event of any
extraordinary dividend or other distribution, recapitalization, forward or
reverse split, reorganization, merger, consolidation, spin-off, combination,
repurchase, or share exchange, or other similar corporate transaction or event
affecting the Stock.
5. ENROLLMENT AND CONTRIBUTIONS.
(a) Eligibility. An associate of the Company or a Subsidiary may be
enrolled in the Plan for any Subscription Period if such associate is employed
by the Company or a Subsidiary on the first day of the Subscription Period,
unless one of the following applies to the associate:
(i) Such person has been employed for less than one year with the
Company or a Subsidiary;
(ii) Such person is customarily employed by the Company or a
Subsidiary for 20 hours or less a week or for not more than five
months in any calendar year; or
(iii) Such person would, immediately upon enrollment, be deemed to
own, for purposes of Section 423(b)(3) of the Code, an aggregate
of five percent or more of the total combined voting power or
value of all outstanding shares of all classes of the Company or
any Subsidiary.
The Company will notify an associate of the date as of which he or she is
eligible to enroll in the Plan, and will make available to each eligible
associate the necessary enrollment forms.
(b) Initial Enrollment. An associate who is eligible under Section 5(a)
(or who will become eligible on or before a given Subscription Period) may,
after receiving current information about the Plan, initially enroll in the Plan
by executing and filing with the Company's Human Resources Department a properly
completed enrollment form, including the associate's election as to the rate of
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payroll contributions for the Subscription Period. To be effective for any
Subscription Period, such enrollment form must be filed during the Enrollment
Period immediately preceding such Subscription Period.
(c) Automatic Re-enrollment for Subsequent Subscription Periods. A
Participant whose enrollment in, and payroll contributions under, the Plan
continues throughout a Subscription Period will automatically be re-enrolled in
the Plan for the next Subscription Period unless (i) the Participant terminates
enrollment before the next Subscription Period in accordance with Section 7(a),
or (ii) on the last day of the relevant Enrollment Period he or she is
ineligible to participate under Section 5(a). The initial rate of payroll
contributions for a Participant who is automatically re-enrolled for a
Subscription Period will be the same as the rate of payroll contribution in
effect at the end of the preceding Subscription Period, unless the Participant
files a new enrollment form during the Enrollment Period immediately preceding
such Subscription Period designating a different rate of payroll contributions.
(d) Payroll Contributions. A Participant will make contributions under
the Plan by means of payroll deductions from each payroll period which ends
during the Subscription Period, at the rate elected by the Participant in his or
her enrollment form filed during the Enrollment Period immediately preceding
such Subscription Period (except that such rate may be changed during the
Subscription Period to the extent permitted below). The rate of payroll
contributions elected by a Participant may not be less than two percent (2%) nor
more than ten percent (10%) of the Participant's Earnings for each payroll
period, and only whole percentages may be elected; provided, however, that the
Board may specify a lower minimum rate and higher maximum rate, subject to
Section 8(c). Notwithstanding the above, a Participant's payroll contributions
will be adjusted downward by the Company as necessary to ensure that the limit
on the amount of Stock purchased with respect to a Subscription Period set forth
in Section 6(a)(iii) is not exceeded. A Participant may elect to increase,
decrease, or discontinue payroll contributions for a future Subscription Period
by filing a new enrollment form during the Enrollment Period immediately
preceding such Subscription Period designating a different rate of payroll
contributions. In addition, a Participant may elect to decrease or discontinue
payroll contributions during a Subscription Period by filing a new enrollment
form, such change to be effective for the next payroll after the Participant's
new enrollment form is received.
(e) Crediting Payroll Contributions to Cash Accounts. All payroll
contributions by a Participant under the Plan will be credited to a Cash Account
maintained by the Custodian on behalf of the Participant. The Custodian will
credit payroll contributions to each Participant's Cash Account upon receipt by
the Custodian from the Company of information identifying the amount of payroll
contribution. The Company will deposit with the Custodian an amount equal to the
aggregate payroll contributions for the Subscription Period (not otherwise
repaid to Participant under Section 7(b)) on or before the Purchase Date for
such Subscription Period.
(f) No Interest on Cash Accounts. No interest will be credited or
payable by the Company on payroll contributions or by the Custodian on cash
balances in Participant's Cash Accounts pending investment in Stock.
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6. PURCHASES OF STOCK
(a) Purchase Rights. Enrollment in the Plan for any Subscription Period
by a Participant will constitute a grant by the Company of a Purchase Right to
such Participant for such Subscription Period. Each Purchase Right will be
subject to the following terms:
(i) The Purchase prices at which Stock will be purchased under a
Purchase Right will be as specified in Section 6(c).
(ii) Except as limited in (iii) below, the number of shares of Stock
that may be purchased upon exercise of the Purchase Right for a
Subscription Period will equal the number of shares (including
fractional shares) that can be purchased at the purchase price
specified in Section 6(c) with the aggregate amount credited to
the Participant's Cash Account as of the Purchase Date.
(iii) The number of shares of Stock subject to a Participant's
Purchase Right for any Subscription Period will not exceed the
lesser of (A) the number derived by dividing $12,500 by 100% of
the Fair Market Value of one share of Stock on the Enrollment
Date for the Subscription Period, or (B) 5,000 shares of Stock.
(iv) The Purchase Right will be automatically exercised on the
Purchase Date for the Subscription Period.
(v) Payments by a Participant for Stock purchased under a Purchase
Right will be made only through payroll deduction in accordance
with Section 5(d) and (e).
(vi) The Purchase Right will expire on the earlier of the Purchase
Date for the Subscription Period or the date on which the
Participant's enrollment in the Plan terminates.
(b) Purchase of Stock. At or as promptly as practicable after the
Purchase Date for a Subscription Period, amounts credited to each Participant's
Cash Account as of such Purchase Date will be applied by the Custodian to the
purchase of shares of Stock, in accordance with the terms of the Plan. Shares of
Stock will be purchased by the Custodian from the Company. Shares sold by the
Company may be authorized but unissued shares or treasury shares, as permitted
under Section 4. The Custodian will aggregate the amounts in all Cash Accounts
when purchasing Stock, and shares purchased will be allocated to each
Participant's Stock Account in proportion to the cash amounts withdrawn from
such Participant's Cash Account. Upon completion of purchases in respect of a
Purchase Date (which will be completed in not more than 30 days after the
Purchase Date), all shares of Stock so purchased for a Participant will be
credited to the Participant's Stock Account.
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(c) Purchase Price. The purchase price of each share of Stock purchased
in respect of a Purchase Date will equal 85% of the lesser of (i) the Fair
Market Value of a share of Stock on the Enrollment Date or (ii) the Fair Market
Value of a share of Stock on the Purchase Date.
(d) Dividend Reinvestment; Other Distributions. Cash dividends on any
Stock credited to a Participant's Stock Account will be automatically reinvested
in additional shares of Stock; such amounts will not be available in the form of
cash to Participants. All cash dividends paid on Stock credited to Participants'
Stock Accounts will be paid over by the Company to the Custodian at the dividend
payment date. The Custodian will aggregate all purchase of Stock in connection
with dividend reinvestment for a given dividend payment date. Purchases of Stock
for purposes of dividend reinvestment will be made as promptly as practicable
(but not more than 30 days) after a dividend payment date. The Custodian will
make such purchases, as directed by the Board, either (i) in transactions on the
NASDAQ National Market System, any securities exchange upon which Stock is
traded, otherwise in the over-the-counter market, or in negotiated transactions,
or (ii) directly from the Company at 100% of the Fair Market Value of a share of
Stock on the dividend payment date. Any shares of Stock distributed as a
dividend or distribution in respect of shares of Stock or in connection with a
split of the Stock credited to a Participant's Stock Account will be credited to
such Account.
(e) Withdrawals and Transfers. Shares of Stock may be withdrawn from a
Participant's Stock Account, in which case one or more certificates for whole
shares may be issued in the name of, and delivered to, the Participant, with
such Participant receiving cash in lieu of fractional shares based on the Fair
Market Value of a share of Stock on the date of withdrawal. Alternatively, whole
shares of Stock may be withdrawn from a Participant's Stock Account by means of
a transfer to a broker-dealer or financial institution that maintains an account
for the Participant, together with the transfer of cash in lieu of fractional
shares based on the Fair Market Value of a share of Stock on the date of
withdrawal. Participants may not designate any other person to receive shares of
Stock withdrawn or transferred under the Plan. A Participant seeking to withdraw
or transfer shares of Stock must give instructions to the Custodian in such
manner and form as may be prescribed by the Custodian, which instructions will
be acted upon as promptly as practicable. Withdrawals and transfers will be
subject to any fees imposed in accordance with Section 8(a).
(f) Excess Account Balances. If any amounts remain in a Cash Account
following a Purchase Date as a result of the limitation set forth in Section
6(a)(iii), such amounts will be returned to the Participant by the Custodian as
promptly as practicable.
7. TERMINATION AND DISTRIBUTIONS.
(a) Termination of Enrollment. A Participant's enrollment in the Plan
will terminate upon (i) the beginning of any payroll period or Subscription
Period that begins after he or she files a written notice of termination of
enrollment with the Company, provided that such Participant will continue to be
deemed to be enrolled with respect to any completed Subscription Period for
which purchases have not been completed, (ii) such time as the Participant
becomes ineligible to participate under Section 5(a)(i) of the Plan, or (iii)
the termination of the Participant's employment by the Company and its
Subsidiaries. An associate whose enrollment in the Plan terminates may again
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enroll in the Plan as of any subsequent Subscription Period that is at least 90
days after such termination of enrollment if he or she satisfies the eligibility
requirements of Section 5(a) as of such Subscription Period. A Participant's
election to discontinue payroll contributions will not constitute a termination
of enrollment.
(b) Distribution. As soon as practicable after a Participant's
enrollment in the Plan terminates, amounts in the Participant's Cash Account
which resulted from payroll contributions will be repaid to the Participant. If
amounts credited to the Participant's Cash Account have not yet been deposited
by the Company with the Custodian, the Company rather than the Custodian will
make the repayment to the Participant. The Custodian will continue to maintain
the Participant's Stock Account for the Participant until the earlier of such
time as the Participant directs the sale of all Stock in the Account, withdraws,
or transfers all Stock in the Account, or one year after the Participant ceases
to be employed by the Company and its Subsidiaries. If a Participant's
termination of enrollment results from his or her death, all amounts payable
will be paid to his or her estate.
8. GENERAL.
(a) Costs. Costs and expenses incurred in the administration of the
Plan and maintenance of Accounts will be paid by the Company, to the extent
provided in this Section 8(a). Any brokerage fees and commissions for the
purchase of Stock under the Plan (including Stock purchased upon reinvestment of
dividends and distributions) will be paid by the Company, but any brokerage fees
and commissions for the sale of Stock under the Plan by a Participant will be
borne by such Participant. The rate at which such fees and commissions will be
charged to Participants will be determined by the Custodian or any broker-dealer
used by the Custodian (including an affiliate of the Custodian), and
communicated from time to time to Participants. In addition, the Custodian may
impose or pass through a reasonable fee for the withdrawal of Stock in the form
of stock certificates (as permitted under Section 6(e)), and reasonable fees for
other services unrelated to the purchase of Stock under the Plan, to the extent
approved in writing by the Company and communicated to Participants.
(b) Statements to Participants. The Custodian will reflect payroll
contributions, purchases, sales, and withdrawals and transfers of shares of
Stock and other Plan transactions by appropriate adjustments to the
Participant's Accounts. The Custodian will, not less frequently than
semi-annually, provide or cause to be provided a written statement to the
Participant showing the transactions in his or her Accounts and the date
thereof, the number of shares of Stock purchased or sold, the aggregate purchase
price paid or sales price received, the purchase or sales price per share, the
brokerage fees and commissions paid (if any), the total shares held for the
Participant's Stock Account (computed to at least three decimal places), and
other information.
(c) Compliance with Section 423. It is the intent of the Company that
this Plan comply in all respects with applicable requirements of Section 423 of
the Code and regulations thereunder. Accordingly, if any provision of this Plan
does not comply with such requirements, such provision will be construed or
deemed amended to the extent necessary to conform to such requirements.
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9. GENERAL PROVISIONS.
(a) Compliance With Legal and Other Requirements. The Plan, the
granting and exercising of Purchase Rights hereunder, and the other obligations
of the Company and the Custodian under the Plan will be subject to all
applicable federal and state laws, rules, and regulations, and to such approvals
by any regulatory or governmental agency as may be required. The Company may, in
its discretion, postpone the issuance or delivery of Stock upon exercise of
Purchase Rights until completion of such registration or qualification of such
Stock or other required action under any federal or state law, rule, or
regulation, listing or other required action with respect to any automated
quotation system or stock exchange upon which the Stock or other Company
securities are designated or listed, or compliance with any other contractual
obligation of the Company, as the Company may consider appropriate, and may
require any Participant to make such representations and furnish such
information as it may consider appropriate in connection with the issuance or
delivery of Stock in compliance with applicable laws, rules, and regulations,
designation or listing requirements, or other contractual obligations.
(b) Limits on Encumbering Rights. No right or interest of a Participant
under the Plan, including any Purchase Right, may be pledged, encumbered, or
hypothecated to or in favor of any party, subject to any lien, obligation, or
liability of such Participant, or otherwise assigned, transferred, or disposed
of except pursuant to the laws of descent or distribution, and any right of a
Participant under the Plan will be exercisable during the Participant's lifetime
only by the Participant.
(c) No Right to Continued Employment. Neither the Plan nor any action
taken hereunder, including the grant of a Purchase Right, will be construed as
giving any associate the right to be retained in the employ of the Company or
any of its Subsidiaries, nor will it interfere in any way with the right of the
Company or any of its Subsidiaries to terminate any associate's employment at
any time.
(d) Taxes. The Company or any Subsidiary is authorized to withhold from
any payment to be made to a Participant, including any payroll and other
payments not related to the Plan, amounts of withholding and other taxes due in
connection with any transaction under the Plan, and a Participant's enrollment
in the Plan will be deemed to constitute his or her consent to such withholding.
In addition, Participants may be required to advise the Company of sales and
other dispositions of Stock acquired under the plan in order to permit the
Company to comply with tax laws and to claim any tax deductions to which the
Company may be entitled with respect to the Plan. (This provision and other Plan
provisions do not set forth an explanation of the tax consequences to
Participants under the Plan. A brief summary of the tax consequences will be
included in disclosure documents to be separately furnished to Participants.)
(e) Changes to the Plan. The Board may amend, alter, suspend,
discontinue, or terminate the Plan without the consent of shareholders or
Participants, except that any such action will be subject to the approval of the
Company's shareholders within one year after such Board action if such
shareholder approval is required by any federal or state law or regulation or
the rules of any automated quotation system or stock exchange on which the Stock
may then be quoted or listed, or if such shareholder approval is necessary in
order for the Plan to continue to meet the requirements of Section 423 of the
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Code, and the Board may otherwise, in its discretion, determine to submit other
such actions to shareholders for approval; provided, however, that, without the
consent of an affected Participant, no amendment, alteration, suspension,
discontinuation, or termination of the Plan may materially and adversely affect
the rights of such Participant with respect to outstanding Purchase Rights
relating to any Subscription Period that has been completed prior to such Board
action. The foregoing notwithstanding, upon termination of the Plan the Board
may elect to terminate all outstanding Purchase Rights at such time as the Board
may designate; in the event of such termination of any Purchase Right prior to
its exercise, all amounts contributed to the Plan which remain in a
Participant's Cash Account will be returned to the Participant (without
interest) as promptly as practicable.
(f) No Rights to Participate; No Shareholder Rights. No Participant or
associate will have any claim to participate in the Plan with respect to
Subscription Periods that have not commenced, and the Company will have no
obligation to continue the Plan. No Purchase Right will confer on any
Participant any of the rights of a shareholder of the Company unless and until
Stock is duly issued or transferred and delivered to the Participant (or
credited to the Participant's Stock Account).
(g) Fractional Shares. Unless otherwise determined by the Board,
purchases of Stock under the Plan executed by the Custodian may result in the
crediting of fractional shares of Stock to the Participant's Stock Account. Such
fractional shares will be computed to at least three decimal places. Fractional
shares will not, however, be issued by the Company, and certificates
representing fractional shares will not be delivered to Participants under any
circumstances.
(h) Nonexclusivity of the Plan. Neither the adoption of the Plan by the
Board nor its submission to the shareholders of the Company for approval will be
construed as creating any limitations on the power of the Board to adopt such
other compensatory arrangements as it may deem desirable, including, without
limitation, the granting of stock options otherwise than under the Plan, and
such arrangements may be either applicable generally or only in specific cases.
(i) Plan Year. The Plan will operate on a plan year that ends December
31 in each year.
(j) Governing Law. The validity, construction, and effect of the Plan
and any rules and regulations relating to the Plan will be determined in
accordance with the laws of the State of Arizona, without giving effect to
principles of conflicts of laws, and applicable federal law.
(k) Effective Date. The Plan will become effective at such time as the
Plan has been approved by shareholders of the Company, at a meeting thereof, by
a vote sufficient to meet the requirements of Section 423(b)(2) of the Code.
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