Exhibit 4.1
VANSTAR CORPORATION
Employee
Stock Purchase Plan
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December 1998
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Vanstar Corporation Employee Stock Purchase Plan
Employee Stock Purchase Plan
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1. NATURE OF THE PLAN
The Vanstar Corporation Employee Stock Purchase Plan (the "Plan")
is intended to provide a method whereby employees of Vanstar
Corporation, a Delaware corporation (the "Company"), and its
subsidiaries will have an opportunity to acquire a proprietary
interest in the Company through the purchase of shares of the
Common Stock, $.001 par value, of the Company. It is the
intention of the Company to have the Plan qualify as an "employee
stock purchase plan" under Section 423 of the Internal Revenue
Code of 1986, as amended (the "Code"). The provisions of the
Plan shall be construed so as to extend and limit participation
in a manner consistent with the requirements of that section of
the Code. The Company is offering to sell shares of Common Stock
to eligible employees pursuant to the terms and conditions set
forth in this Plan. The maximum number of shares of Common Stock
that may be issued under the Plan is 2,000,000, subject to
adjustments upon changes in the capitalization of the Company as
provided in Section 10(c).
2. DEFINITIONS
"Board of Directors" means the Board of Directors of the Company.
"Committee" means the Committee appointed by the Board of
Directors to administer the Plan as contemplated by Section 9.
"Common Stock" means the Common Stock, $.001 par value, issued by
the Company.
"Employee" means any person who is customarily employed on a full-
time or part-time basis by the Company or any of its subsidiaries
and is regularly scheduled to work more than 20 hours per week
and five months or more in a calendar year.
"Option Period" means each semi-annual period, commencing on
March 1 and ending on August 31 and commencing on September 1 and
ending on February 28 (or, in the case of a leap year, February
29), provided, however, that the first Option Period under the
Plan (the "Initial Option Period") shall commence on the date of
the execution of the Underwriting Agreement among the Company and
the underwriters named therein with respect to the initial public
offering of the Common Stock (the "Underwriting Agreement") and
end on August 31, 1996. Each Option Period includes only regular
pay days falling within it.
"Purchase Price" has the meaning set forth in Section 5 (b) .
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Vanstar Corporation Employee Stock Purchase Plan
3. ELIGIBILITY AND PARTICIPATION
(a) INITIAL ELIGIBILITY. Each Employee shall be eligible to
participate in the Plan on the first day of the first Option
Period after the date of hire as an Employee with either the
Company or any of its subsidiaries.
(b) RESTRICTIONS ON PARTICIPATION. Notwithstanding any
provisions of the Plan to the contrary, no Employee shall be
granted rights or options to purchase Common Stock under the
Plan if, immediately after the grant, such Employee would
own stock, and/or hold outstanding options or rights to
purchase stock, possessing 5% or more of the total combined
voting power or value of all classes of stock of the
Company. For purposes of this paragraph, the rules of
Section 424(d) of the Code shall apply in determining stock
ownership of any Employee.
(c) COMMENCEMENT OF PARTICIPATION. An eligible Employee may
commence participation in the Plan by completing a payroll
deduction authorization form provided by the Company and
filing it with the Company's payroll administrator ten (10)
working days before the start of an Option Period. Payroll
deductions for an Employee shall commence for the applicable
Option Period when his or her authorization for a payroll
deduction becomes effective and shall remain effective until
all shares of Common Stock authorized for the Plan under
Section 1 have been issued, unless sooner terminated by the
Employee as provided in Section 6. Payroll deductions may
not be increased or decreased during any Option Period,
except to reflect changes in base pay during such Option
Period. Anything contained herein to the contrary
notwithstanding, with respect to the Initial Option Period
only, all eligible Employees shall be deemed to have elected
to participate in the Plan as of the first day of such
Option Period; provided, however, that in order to continue
such participation for any other Option Period, each such
Employee must complete and file a payroll deduction
authorization form as required by this Section 3 (c).
4. PAYMENT OF PURCHASE PRICE
(a) PAYROLL DEDUCTIONS. At the time an Employee files his or
her payroll deduction authorization form, he or she shall
elect to have deductions made from his or her pay on each
payday during the time he or she participates in the Plan at
a fixed dollar amount chosen by such Employee, except that
such amount may not be less than 2% nor more than 10% of the
amount of such Employee's regular pay. An Employee may
discontinue his or her participation in the Plan as provided
in Section 6, but no other change can be made during an
Option Period.
(b) INITIAL OPTION PERIOD. With respect to the Initial Option
Period only, an Employee may pay for shares of Common Stock
purchased pursuant to the Plan by check or payroll deduction
or a combination thereof or such other method as shall be
permitted by the Committee; provided, however, that the
purchase price for such shares for such Initial Option
Period shall not be less than 2% nor more than 10% of the
amount of such Employee's regular pay during such Initial
Option Period.
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Vanstar Corporation Employee Stock Purchase Plan
5. GRANTING OF RIGHT TO PURCHASE
(a) NUMBER OF SHARES. On the first day of each Option Period,
each Employee participating in the Plan shall be deemed to
be granted options to purchase, and on the last day of each
Option Period, each such Employee shall be deemed to have
exercised such options to purchase, that number of shares of
Common Stock equal to the quotient obtained by dividing (i)
the aggregate dollar amount that he or she has elected to
have withheld for the Option Period by (ii) the Purchase
Price. Anything contained herein to the contrary
notwithstanding, but subject to the limitations set forth in
Section 5(f) hereof, in the case of the Initial Option
Period only, on the first day of such Initial Option Period,
each eligible Employee shall be granted options to purchase
that number of shares of Common Stock equal to the quotient
obtained by dividing (A) 10% of such Employee's regular pay
during such Initial Option Period by (B) the Purchase Price,
and on the last day of such Initial Option Period, each such
Employee shall be deemed to have exercised such options to
purchase such number of such shares of Common Stock for
which such Employee shall have paid the Purchase Price no
later than the last day of such Initial Option Period.
(b) PURCHASE PRICE. The purchase price (the "Purchase Price")
of Common Stock for an Employee for any Option Period shall
be equal to eighty-five percent (85%) of the lower of (x)
the closing price of the Common Stock on the first day of
such Option Period and (y) the closing price of the Common
Stock on the last day of such Option Period (or, in each
case, if such day shall not be a trading day, on the next
preceding business day on which trading occurred on the New
York Stock Exchange); provided, however, that in the case of
the Initial Option Period only, the Purchase Price shall be
equal to eighty-five percent (85%) of the lower of (A) the
initial public offering price per share of the Common Stock
and (B) the closing price of the Common Stock on the last
day of such Initial Option Period (or if such day shall not
be a trading day, on the next preceding business day on
which trading occurred on the New York Stock Exchange).
(c) PURCHASE OF SHARES. Unless an Employee has given written
notice to the Company under Section 6(a), amounts withheld
for or otherwise paid by him or her shall be used on the
last day of such Option Period to purchase the number of
whole shares of Common Stock that his or her accumulated
payroll deductions and other payments, if any, at that time
will purchase at the Purchase Price and any excess amount at
that time will be retained by the Company for him or her
until the next purchase of shares under the Plan.
(d) TRANSFERABILITY OF RIGHTS. During an Employee's lifetime,
rights held by the Employee to purchase Common Stock under
the Plan shall be exercisable only by that Employee.
(e) DELIVERY OF STOCK. Following the end of each Option Period,
the Company will deliver, or cause the Company's transfer
agent to deliver, to each Employee certificates representing
the Common Stock purchased by the Employee hereunder during
such Option Period.
(f) ANNUAL PURCHASE LIMIT. No Employee shall be granted rights
to purchase Common Stock under the Plan that permit his or
her rights to purchase Common Stock under all plans of the
Company intended to qualify under Section 423 of the Code to
accrue at a rate which exceeds $25,000 in fair market value
of Common Stock (determined at the time such right is
granted) for each calendar year in which such right is
outstanding. Any amounts received
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Vanstar Corporation Employee Stock Purchase Plan
from an Employee which cannot be used to purchase Common
Stock as a result of this limitation will be returned as
soon as practicable to the Employee without interest.
6. WITHDRAWAL
(a) IN GENERAL. An Employee may revoke his or her payroll
deduction election under the Plan for an Option Period by
giving written notice to the Company (on any form prescribed
by the Committee) at any time after the commencement of such
Option Period. Any of the Employee's payroll deductions
credited to him or her (attributable to unused amounts from
the prior Option Period related to fractional shares) will
be paid to him or her without interest promptly after
receipt of his or her notice of withdrawal, and no further
payroll deductions will be made from his or her pay during
such Option Period. Anything contained herein to the
contrary notwithstanding, an Employee may revoke his or her
participation in the Plan for the Initial Option Period by
giving written notice to the Company (on any form prescribed
by the Committee) at any time after the commencement of such
Option Period.
(b) EFFECTIVE ON SUBSEQUENT PARTICIPATION. An Employee's
withdrawal under Section 6(a) will have no effect upon his
or her eligibility to participate in the Plan for any
succeeding Option Period or any similar plan which may
hereafter be adopted by the Company; provided, however, that
pursuant to Section 3(c), an Employee who withdraws from
participation under Section 6(a) may not again participate
in the Plan until the next succeeding Option Period.
(c) TERMINATION OF EMPLOYMENT. Upon termination of the
Employee's employment with the Company and its subsidiaries,
any outstanding rights of the Employee to purchase Common
Stock during the Option Period in which his or her
employment terminates shall be deemed to be terminated and
any accumulated payroll deductions or other payments at such
time will be returned to the Employee, without interest.
7. INTEREST
No interest will be paid or allowed on any money withheld or
received by the Company under Section 4 of the Plan.
8. STOCK
(a) MAXIMUM SHARES. If the total number of shares of Common
Stock for which rights are exercised on the last day of any
Option Period in accordance with Section 5(c) causes the
aggregate number of shares of Common Stock issued under the
Plan since its effective date (as set forth in Section
10(d)) to exceed the maximum number of shares of Common
Stock authorized under Section 1, the Committee shall make a
pro rata allocation of the shares available for delivery and
distribution in as uniform a manner as shall be practicable
and as it shall determine to be equitable, and the balance
of payroll deductions or other payments of each Employee
under the Plan shall be returned to him or her without
interest as promptly as possible.
(b) PARTICIPANT'S INTEREST IN STOCK. An Employee will have no
interest in shares of Common Stock hereunder until such
shares are purchased under Section 5(c). Such shares shall
not
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Vanstar Corporation Employee Stock Purchase Plan
be transferable by the Employee until certificates are
delivered to him or her pursuant to Section 5(e) .
(c) REGISTRATION OF STOCK. Stock to be delivered to an Employee
under the Plan will be registered in the name of the
Employee.
(d) RESTRICTIONS ON PURCHASE. The Committee may, in its
discretion, require as a condition to the exercise of any
rights to purchase hereunder, that the shares of Common
Stock reserved for issuance under the Plan shall have been
duly listed, upon official notice of issuance, in the New
York Stock Exchange and in a Registration Statement under
the Securities Act of 1933, as amended, which with respect
to said shares shall be effective.
9. ADMINISTRATION
(a) APPOINTMENT OF COMMITTEE. The Board of Directors shall
appoint a committee (the "Committee") to administer the
Plan, which shall consist of two or more members of the
Board of Directors. Members of the Committee shall serve at
the pleasure of the Board of Directors and will be subject
to removal by the Board of Directors at any time. No member
of the Committee shall be eligible to purchase Common Stock
under the Plan.
(b) AUTHORITY OF COMMITTEE. Subject to the express provisions
of the Plan, the Committee shall have the authority, in its
discretion, to interpret and construe any and all provisions
of the Plan, to adopt rules and regulations for
administering the Plan, and to make all other determinations
deemed necessary or advisable for administering the Plan.
The Committee's determination on such matters shall be
conclusive.
(c) RULES GOVERNING THE ADMINISTRATION OF THE COMMITTEE. The
Committee may select one of its members as its Chairman and
shall hold its meetings at such times and places as it shall
deem advisable and may hold telephonic meetings. A majority
of its members shall constitute a quorum. All
determinations of the Committee shall be made by a majority
of its members. The Committee may correct any defect or
omission or reconcile any inconsistency in the Plan, in the
manner and to the extent it shall deem desirable. Any
decision or determination reduced to writing and signed by a
majority of the members of the Committee shall be as fully
effective as if it had been made by a majority vote at a
meeting duly called and held. The Committee may appoint a
secretary and shall make such rules and regulations for the
conduct of its business as it shall deem advisable.
10. MISCELLANEOUS
(a) TRANSFERABILITY. Neither the payroll deductions or other
payments of an Employee nor any rights with regard to the
purchase of stock under the Plan may be assigned,
transferred, pledged, or otherwise disposed of in any way by
the Employee other than by will or the laws of descent and
distribution. Any such attempted assignment, transfer,
pledge or other disposition shall be without effect.
(b) USE OF FUNDS. All amounts withheld or received by the
Company under this Plan may be used by the Company for any
corporate purpose and the Company shall not be obligated to
segregate such amounts.
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Vanstar Corporation Employee Stock Purchase Plan
(c) ADJUSTMENT UPON CHANGES IN CAPITALIZATION.
(i) If, while any rights to purchase shares are outstanding, the
outstanding shares of Common stock of the Company have
increased, decreased, changed into, or been exchanged for a
different number or kind of shares or securities of the
Company or of another entity through reorganization, merger,
recapitalization, reclassification, stock split, reverse
stock split or similar transaction, appropriate and
proportionate adjustments may be made by the Committee in
the number and/or kind of shares which are subject to
purchase under outstanding rights and in the purchase price
or prices applicable thereto. In addition, in any such
event, the number and/or kind of shares which may be offered
hereunder shall also be proportionately adjusted.
(ii) Upon the dissolution or liquidation of the Company, or upon
a reorganization, merger or consolidation of the Company
with one or more corporations as a result of which the
Company is not the surviving corporation, or upon a sale of
substantially all of the property or stock of the Company to
another corporation, no further shares will be available for
purchase by Participants under the Plan, except that any
payroll deductions or other payments collected in that
Option Period will be immediately applied to purchase whole
shares of Common Stock. The Board of Directors shall take
such steps in connection with such transactions as it shall
deem necessary to assure that the provisions of this Section
10(c)(ii) shall thereafter be applicable, as nearly as
reasonably may be determined.
(d) AMENDMENT AND TERMINATIONS. The Board of Directors shall
have complete power and authority to terminate or amend the
Plan; provided, however, that the approval of the holders of
a majority of the votes that may be cast by all of the
holders of shares of Common Stock and preferred stock of the
Company, if any, entitled to vote (voting as a single class)
shall be obtained prior to any such amendment becoming
effective if such approval is required by law or is
necessary to comply with the regulations promulgated by the
Securities and Exchange Commission under Section 16(b) of
the Securities Exchange Act of 1934, as amended, or with the
Code or the regulations promulgated by the Treasury
Department thereunder. No termination, modification or
amendment of the Plan may, without the consent of an
Employee then having an outstanding right under the Plan to
purchase stock, adversely affect such right.
(e) EFFECTIVE DATE. The Plan shall become effective on the
later to occur of (i) the date on which the Plan is approved
by the stockholders of the Company entitled to vote thereon
and (ii) the date on which the Underwriting Agreement is
executed; provided, however, that the Plan will not be
effective if the stockholder vote occurs more than 12 months
before or after the Plan is adopted by the Board of
Directors of the Company. The Plan will terminate on the
earlier of (A) the tenth anniversary of the effective date
of the Plan and (B) the date on which all shares of Common
Stock available for issuance under the Plan have been sold.
(f) NO EMPLOYMENT RIGHTS. The Plan does not, directly or
indirectly, create in any Employee or class of Employees any
right with respect to continuation of employment by the
Company or any of its subsidiaries, and it shall not be
deemed to interfere in any way with the right of the Company
or of any of its subsidiaries to terminate, or otherwise
modify, an Employee's employment at any time.
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Vanstar Corporation Employee Stock Purchase Plan
(g) EFFECT OF PLAN. The provisions of the Plan shall, in
accordance with its terms, be binding upon, and inure to the
benefit of, all successors of each Employee participating in
the Plan, including, without limitation, such Employee's
estate and the executors, administrators or trustees
thereof, heirs and legatees, and any receiver, trustee in
bankruptcy or representative of creditors of such Employee.
(h) GOVERNING LAW. The laws of the state of Delaware will
govern all matters relating to this Plan except to the
extent superseded by the laws of the United States.
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