WESTAFF,INC. INTERNATIONALEMPLOYEE STOCK PURCHASE PLAN (As Amended and Restated July 26, 2006)

EX-10.11.5 3 a07-2424_1ex10d11d5.htm EX-10.11.5

Exhibit 10.11.5

WESTAFF, INC.

INTERNATIONAL EMPLOYEE STOCK PURCHASE PLAN

(As Amended and Restated July 26, 2006)

I.              PURPOSE OF THE PLAN

This International Employee Stock Purchase Plan is intended to promote the interests of Westaff, Inc. by providing eligible employees of the Corporation’s Foreign Subsidiaries with the opportunity to acquire a proprietary interest in the Corporation through the purchase of shares of the Corporation’s Common Stock at periodic intervals.

Capitalized terms herein shall have the meanings assigned to such terms in the attached Appendix.

II.            ADMINISTRATION OF THE PLAN

The Plan Administrator shall have full authority to interpret and construe any provision of the Plan and to adopt such rules and regulations for adminis­tering the Plan as it may deem necessary. Decisions of the Plan Administrator shall be final and binding on all parties having an interest in the Plan.

III.           STOCK SUBJECT TO PLAN

A.            The stock purchasable under the Plan shall be shares of authorized but unissued or reacquired Common Stock, including shares of Common Stock purchased on the open market. The maximum number of shares of Common Stock which may be issued over the term of the Plan shall not exceed one hundred thirty-seven thousand and five hundred (137,500) shares.

B.            Should any change be made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Corporation’s receipt of consideration, appropriate adjustments shall be made to (i) the maximum number and class of securities issuable under the Plan, (ii) the maximum number and class of securities purchasable per Participant on any one Purchase Date and (iii) the number and class of securities and the price per share in effect under each outstanding purchase right in order to prevent the dilution or enlargement of benefits thereunder.




IV.           PURCHASE PERIODS

A.            Shares of Common Stock shall be offered for purchase under the Plan through a series of successive purchase periods until such time as (i) the maximum number of shares of Common Stock available for issuance under the Plan shall have been purchased or (ii) the Plan shall have been sooner terminated. The Board shall have the power to change the duration of purchase periods (including the commencement and termination dates thereof) with respect to future purchase periods without shareholder approval if such change is announced at least fifteen (15) days prior to the scheduled beginning of the first purchase period to be affected thereafter.

B.            Each purchase period shall have a duration of six (6) months. Purchase periods shall run from the first business day in February to the last business day in July and from the first business day in August to the last business day in January of the following year. The first purchase period began on November 3, 1996 and ended on the last business day in January 1997.

V.            ELIGIBILITY

A.            Each individual who is an Eligible Employee on the start date of any purchase period shall be eligible to participate in the Plan for that purchase period. However, each individual who is an Eligible Employee of a Foreign Subsidiary which designates an Effective Date that is not the start date of a purchase period shall be eligible to participate in the Plan for the purchase period during which the Effective Date occurs beginning with such Effective Date.

B.            To participate in the Plan for a particular purchase period, the Eligible Employee must complete the enrollment/change forms prescribed by the Plan Administrator and file such forms with the Plan Administrator (or its designate) on or before the start date of the purchase period.

VI.           PAYMENT FOR THE SHARES

A.            Except to the extent otherwise provided in the Plan (or any Addendum thereto) or authorized by the Plan Administrator, the purchase price for the shares of Common Stock acquired under the Plan shall be paid from accumulated payroll deductions authorized by the Participant.

B.            The payroll deduction authorized by the Parti­cipant for purposes of acquiring shares of Common Stock under the Plan may be any multiple of one percent (1%) of the Cash Earnings paid to the Participant during each purchase period, up to a maximum of ten percent (10%). The deduction rate so authorized shall continue in effect for the entire purchase period. The Participant may not increase his or her rate of payroll deduction during a purchase period. However, the Participant may, at any time during the purchase period, reduce his or her rate of payroll deduction to become effective as soon as possible after filing the appropriate form with the Plan Administrator. The Participant may not, however, effect more than one (1) such reduction per purchase period.

C.            Payroll deductions shall begin on the first pay day following the start date of the purchase period and shall (unless sooner terminated by the Participant) continue through the pay

2




day ending with or immediately prior to the last day of the purchase period. The payroll deductions so collected shall be credited to the Participant’s book account under the Plan, initially in the currency in which paid by the Foreign Subsidiary. Except to the extent otherwise provided by the Plan Administrator (or any Addendum to the Plan), no interest shall be paid on the balance from time to time outstanding in such account and the amounts collected from the Participant shall not be held in any segregated account or trust fund and may be commingled with the general assets of the Corporation and used for general corporate purposes.

D.            The payroll deductions credited to each Participant’s book account during each calendar month shall be converted into U.S. Dollars on the Exchange Date for that month on the basis of the exchange rate in effect on such date. The Plan Administrator shall have the absolute discretion to determine the applicable exchange rate to be in effect for each Exchange Date by any reasonable method (including, without limitation, the exchange rate actually available in the ordinary course of business on such date). Any changes or fluctuations in the exchange rate at which the payroll deductions collected on the Participant’s behalf are converted into U.S. Dollars on each Exchange Date shall be borne solely by the Participant.

E.             Payroll deductions shall automatically cease upon the termination of the Participant’s purchase right in accord­ance with the provisions of the Plan.

F.             The Participant’s acquisition of Common Stock under the Plan on any Purchase Date shall neither limit nor require the Participant’s acquisition of Common Stock on any subsequent Purchase Date.

VII.         PURCHASE RIGHTS

A.            Grant of Purchase Right. A Participant shall be granted a separate purchase right on the start date of each purchase period in which he or she participates. The purchase right shall provide the Participant with the right to purchase shares of Common Stock on the Purchase Date upon the terms set forth below. The Participant shall execute a stock purchase agreement embodying such terms and such other provisions (not inconsistent with the Plan) as the Plan Administrator may deem advisable.

Under no circumstances shall purchase rights be granted under the Plan to any Eligible Employee if such individual would, immediately after the grant, own (within the meaning of Code Section 424(d)) or hold outstanding options or other rights to purchase, stock possessing five percent (5%) or more of the total combined voting power or value of all classes of stock of the Corporation or any Corporate Affiliate.

B.            Exercise of the Purchase Right. Each purchase right shall be automatically exercised on the Purchase Date, and shares of Common Stock shall accordingly be purchased on behalf of each Participant (other than any Participant whose payroll deductions have previously been refunded pursuant to the Termination of Purchase Right provisions below) on such date. The purchase shall be effected by applying the Participant’s payroll deductions (as converted into U.S. Dollars) for the purchase period ending on such Purchase Date to the purchase of shares of

3




Common Stock (subject to the limitation on the maximum number of shares purchasable per Participant on any one Purchase Date) at the purchase price in effect for that purchase period.

C.            Purchase Price. The purchase price per share at which Common Stock will be purchased on the Participant’s behalf on each Purchase Date shall be equal to ninety percent (90%) of the lower of (i) the Fair Market Value per share of Common Stock on the start date of the purchase period or (ii) the Fair Market Value per share of Common Stock on that Purchase Date.

D.            Number of Purchasable Shares. The number of shares of Common Stock purchasable by a Participant on each Purchase Date shall be the number of whole shares obtained by dividing the amount collected from the Participant through payroll deductions (as converted into U.S. Dollars) during the purchase period ending with that Purchase Date by the purchase price in effect for that Purchase Date. However, the maximum number of shares of Common Stock purchasable per Participant on any one Purchase Date shall not exceed one thousand one hundred twenty-five (1,125) shares, subject to periodic adjustments in the event of certain changes in the Corporation’s capitalization.

E.             Excess Payroll Deductions. Any payroll deductions not applied to the purchase of shares of Common Stock on any Purchase Date because they are not sufficient to purchase a whole share of Common Stock shall be held for the purchase of Common Stock on the next Purchase Date. However, any payroll deductions not applied to the purchase of Common Stock by reason of the limitation on the maximum number of shares purchasable by the Participant on the Purchase Date shall be promptly refunded in the currency in which collected.

F.             Termination of Purchase Right. The following provisions shall govern the termination of outstanding purchase rights:

1.             A Participant may, at any time prior to the last day of the purchase period, terminate his or her outstanding purchase right by filing the appropriate form with the Plan Administrator (or its designate), and no further payroll deductions shall be collected from the Participant with respect to the terminated purchase right. Any payroll deductions collected during the purchase period in which such termination occurs shall, at the Participant’s election, be immediately refunded in the currency in which collected or held for the purchase of shares on the next Purchase Date. If no such election is made at the time such purchase right is terminated, then the payroll deductions collected with respect to the terminated right shall be refunded as soon as possible.

2.             The termination of such purchase right shall be irrevocable, and the Participant may not subsequently rejoin the purchase period for which the terminated purchase right was granted. In order to resume participation in any subsequent purchase period, such individual must re-enroll in the Plan (by making a timely filing of the prescribed enrollment forms) on or before the start date of the new purchase period.

3.             Should the Participant cease to remain an Eligible Employee for any reason (including death, disability or change in status) while his or her purchase right

4




remains outstanding, then that purchase right shall immediately terminate, and all of the Participant’s payroll deductions for the purchase period in which the purchase right so terminates shall be immediately refunded in the currency in which collected. However, should the Participant cease to remain in active service by reason of an approved unpaid leave of absence, then the Participant shall have the right, exercisable up until the last business day of the purchase period in which such leave commences, to (a) withdraw all the payroll deductions collected to date on his or her behalf during such purchase period or (b) have such funds held for the purchase of shares on the next scheduled Purchase Date. In no event, however, shall any further payroll deductions be collected on the Participant’s behalf during such leave. Upon the Participant’s return to active service, his or her payroll deductions under the Plan shall automatically resume at the rate in effect at the time the leave began, unless the Participant withdraws from the Plan prior to his or her return.

G.            Transfer of Employment. In the event that a Participant who is an Employee of a Foreign Subsidiary is transferred and becomes an Employee of the Corporation during a purchase period under the Plan, such individual shall continue to remain a Participant in the Plan and payroll deductions shall continue to be collected until the next purchase date as if the Participant had remained an Employee of the Foreign Subsidiary.

In the event that an Employee of the Corporation who is a participant in the U.S. Plan is transferred and becomes an Employee of a Foreign Subsidiary during a purchase period in effect under the U.S. Plan, such individual shall automatically become a Participant under the Plan for the duration of the purchase period in effect at that time under the Plan and the balance in such individual’s book account maintained under the U.S. Plan shall be transferred as a balance to a book account opened for such individual under the Plan. Such balance, together with all other payroll deductions collected from such individual by the Foreign Subsidiary for the remainder of the purchase period under the Plan (as converted into U.S. Dollars), shall be applied on the next purchase date to the purchase of Stock under the Plan.

H.            Corporate Transaction. In the event of a proposed Corporate Transaction, each outstanding purchase right shall be assumed by such successor corporation or a parent or subsidiary of such successor corporation, unless the Plan Administrator, in the exercise of its sole discretion and in lieu of such assumption, determines to shorten the purchase period then in progress by setting a new Purchase Date (the “New Purchase Date”). If the Plan Administrator shortens the purchase period then in progress in lieu of assumption in the event of a Corporate Transaction, the Plan Administrator shall notify each Participant in writing at least ten (10) business days prior to the New Purchase Date, that the Purchase Date for the Participant’s option has been changed to the New Purchase Date and that either:

1.             the Participant’s purchase right will be exercised automatically on the New Purchase Date, unless prior to such date the Participant has terminated his or her purchase right as provided in Section VII.F.1; or

2.             the Company shall pay to the Participant on the New Purchase Date an amount in cash, cash equivalents, or property as determined by the Plan Administrator that is

5




equal to the difference in the Fair Market Value of the shares subject to the purchase right and the purchase price due had the Participant’s purchase right been exercised automatically under clause 1 above.

For purposes of this Subsection, a purchase right granted under the Plan shall be deemed to be assumed if, in connection with the Corporate Transaction, the purchase right is replaced with a comparable purchase right with respect to shares of the successor corporation or parent thereof. The determination of purchase right comparability shall be made by the Plan Administrator prior to the Corporate Transaction and its determination shall be final, binding and conclusive on all persons.

I.              Proration of Purchase Rights. Should the total number of shares of Common Stock which are to be purchased pursuant to outstanding purchase rights on any particular date exceed the number of shares then available for issuance under the Plan, the Plan Administrator shall make a pro-rata allocation of the available shares on a uniform and nondiscriminatory basis, and the payroll deductions of each Participant, to the extent in excess of the aggregate purchase price payable for the Common Stock pro-rated to such individual, shall be refunded.

J.             Assignability. The purchase right shall be exercisable only by the Participant and shall not be assignable or transferable by the Participant.

K.            Stockholder Rights. A Participant shall have no stockholder rights with respect to the shares subject to his or her outstanding purchase right until the shares are purchased on the Participant’s behalf in accordance with the provisions of the Plan and the Participant has become a holder of record of the purchased shares.

VIII.        ACCRUAL LIMITATIONS

A.            No Participant shall be entitled to accrue rights to acquire Common Stock pursuant to any purchase right outstanding under this Plan if and to the extent such accrual, when aggregated with (i) rights to purchase Common Stock accrued under any other purchase right granted under this Plan and (ii) similar rights accrued under other employee stock purchase plans (within the meaning of Code Section 423) of the Corporation or any Corporate Affiliate, would otherwise permit such Participant to purchase more than Twenty-Five Thousand U.S. Dollars (U.S. $25,000) worth of stock of the Corporation or any Corporate Affiliate (determined on the basis of the Fair Market Value of such stock on the date or dates such rights are granted) for each calendar year such rights are at any time outstanding.

B.            For purposes of applying such accrual limitations, the following provisions shall be in effect:

1.             The right to acquire Common Stock under each outstanding purchase right shall accrue on the Purchase Date in effect for the purchase period for which such right is granted.

2.             No right to acquire Common Stock under any outstanding purchase right shall accrue to the extent the Participant has already accrued in the same calendar year the

6




right to acquire Common Stock under one (1) or more other purchase rights at a rate equal to Twenty-Five Thousand U.S. Dollars (U.S. $25,000) worth of Common Stock (determined on the basis of the Fair Market Value per share on the date or dates of grant) for each calendar year such rights were at any time outstanding.

C.            If by reason of such accrual limitations, any purchase right of a Participant does not accrue for a particular purchase period, then the payroll deductions which the Participant made during that purchase period with respect to such purchase right shall be promptly refunded.

D.            In the event there is any conflict between the provisions of this Article and one or more provisions of the Plan or any instrument issued thereunder, the provisions of this Article shall be controlling.

IX.           EFFECTIVE DATE AND TERM OF THE PLAN

A.            The Plan was adopted by the Board on October 15, 1996 and became effective on November 3, 1996, provided no purchase rights granted under the Plan were to be exercised, and no shares of Common Stock were to be issued hereunder, until the Corporation had complied with all applicable requirements of the 1933 Act (including the registration of the shares of Common Stock issuable under the Plan on a Form S-8 registration statement filed with the Securities and Exchange Commission), all applicable listing requirements of any stock exchange (or the Nasdaq Global Market, if applicable) on which the Common Stock is listed for trading and all other applicable requirements established by law or regula­tion. In the event such compliance were not effected, within twelve (12) months after the date on which the Plan is adopted by the Board, the Plan was to have terminated and have no further force or effect and all sums collected from Participants during the initial purchase period hereunder were to have been refunded.

B.            Unless sooner terminated by the Board, the Plan shall terminate upon the earliest to occur of (i) the last business day in January 2017, (ii) the date on which all shares available for issuance under the Plan shall have been sold pursuant to purchase rights exercised under the Plan or (iii) the date on which all purchase rights are exercised in connection with a Corporate Transaction. No further purchase rights shall be granted or exercised, and no further payroll deductions shall be collected, under the Plan following such termination.

X.            AMENDMENT OF THE PLAN

The Board may alter, amend, suspend or discontinue the Plan at any time to become effective immediately following the close of any purchase period.

7




On July 26, 2006, the Board adopted and approved an amendment and restatement of the Plan to extend the term of the Plan to the last business day of January, 2017 and, effective for purchase periods commencing on and after August 1, 2006, to modify the purchase price per share discount from eighty-five percent (85%) to ninety percent (90%) and to expand the actions the Company may take in connection with a Corporate Transaction and to modify the list of Participating Corporations who extend the benefits of the Plan to their Eligible Employees.

XI.           GENERAL PROVISIONS

A.            All costs and expenses incurred in the administration of the Plan shall be paid by the Corporation.

B.            Nothing in the Plan shall confer upon the Participant any right to continue in the employ of the Corporation or any Corporate Affiliate for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation (or any Corporate Affiliate employing such person) or of the Participant, which rights are hereby expressly reserved by each, to terminate such person’s employment at any time for any reason, with or without cause.

C.            Except to the extent otherwise provided in any Addendum to the Plan, the provisions of the Plan shall be governed by the laws of the State of California without resort to that State’s conflict-of-laws rules.

D.            A Foreign Subsidiary or the Plan Administrator, as the case may be, shall have the right to deduct from any payment to be made under this Plan, or to otherwise require, prior to the issuance or delivery of any shares of Common Stock or the payment of any cash, payment by each Participant of any tax required by applicable law to be withheld.

E.             Additional provisions for individual Foreign Subsidiaries may be incorporated in one or more Addenda to the Plan. Such Addenda shall have full force and effect with respect to the Foreign Subsidiaries to which they apply. In the event of a conflict between the provisions of such an Addendum and one or more other provisions of the Plan, the provisions of the Addendum shall be controlling.

 

8




Exhibit 10.11.5

Schedule A

CURRENT LIST OF PARTICIPATING COMPANIES

Westaff (U.K.) Limited

 

Westaff (Australia) Pty Ltd

 

Westaff NZ Limited

 




Exhibit 10.11.5

APPENDIX

The following definitions shall be in effect under the Plan:

A.            Board shall mean the Corporation’s Board of Directors.

B.            Cash Earnings shall mean the (i) regular base salary paid to a Participant by one or more Foreign Subsidiaries during such individual’s period of participation in one or more purchase periods under the Plan plus (ii) all overtime payments, bonuses, commissions, current profit-sharing distributions and other incentive-type payments. However, Cash Earnings shall not include any contributions made on the Participant’s behalf by the Corporation or any Corporate Affiliate under any employee benefit or welfare plan now or hereafter established.

C.            Code shall mean the U.S. Internal Revenue Code of 1986, as amended.

D.            Common Stock shall mean the Corporation’s common stock.

E.             Corporate Affiliate shall mean any parent or subsidiary corporation of the Corporation, whether now existing or subsequently established.

F.             Corporate Transaction shall mean either of the following stockholder-approved transactions to which the Corporation is a party:

1.             a merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction;

2.             the sale, transfer or other disposition of all or substantially all of the assets of the Corporation in complete liquidation or dissolution of the Corporation; or

3.             an acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act of 1934, as amended) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities.

G.            Corporation shall mean Westaff, Inc., a Delaware corporation, and any corporate successor to all or substan­tially all of the assets or voting stock of Westaff, Inc. which shall by appropriate action adopt the Plan.

H.            Effective Date shall mean November 3, 1996. Any Foreign Subsidiary which elects, with the approval of the Board, to extend the benefits of this Plan to its employees after such Effective Date shall designate a subsequent Effective Date with respect to its employee-Participants.

I.              Eligible Employee shall mean any person who is employed by a Participating Corporation as a regular staff employee (and not temporary) on a basis under which he or she is regularly expected to render more than twenty (20) hours of service per week for more than five (5) months per calendar year for earnings considered wages under Code Section 3401(a).




J.             Exchange Date shall mean the last U.S. business day of each month during a purchase period, on which date the foreign currency payroll deductions collected on behalf of the Participants during that month are to be converted into U.S. Dollars.

K.            Fair Market Value per share of Common Stock on any relevant date shall be determined in accordance with the following provisions:

1.             If the Common Stock is are listed on one or more established stock exchanges or national market systems, including without limitation The NASDAQ Global Select Market, The NASDAQ Global Market and The NASDAQ Capital Market,its Fair Market Value shall be the closing sales price for such shares (or the closing bid, if no sales were reported) as quoted on the principal exchange or system on which the Common Stock is listed (as determined by the Plan Administrator) on the date of determination (or, if no closing sales price or closing bid was reported on that date, as applicable, on the last trading date such closing sales price or closing bid was reported), as reported in The Wall Street Journal or such other source as the Plan Administrator deems reliable;

2.             If the Common Stock is regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a recognized securities dealer, its Fair Market Value shall be the closing sales price for such shares as quoted on such system or by such securities dealer on the date of determination, but if selling prices are not reported, the Fair Market Value of the Common Stock shall be the mean between the high bid and low asked prices for the Common Stock on the date of determination (or, if no such prices were reported on that date, on the last date such prices were reported), as reported in The Wall Street Journal or such other source as the Plan Administrator deems reliable; or

3.             In the absence of an established market for the Common Stock of the type described in (1) and (2), above, the Fair Market Value thereof shall be determined by the Plan Administrator in good faith.

L.            Foreign Subsidiary shall mean any non-U.S. Corporate Affiliate or Affiliates as may be authorized from time to time by the Board to extend the benefits of the Plan to their Eligible Employees. The Foreign Subsidiaries participating in the Plan as of the Effective Date are listed in attached Schedule A.

M.           1933 Act shall mean the Securities Act of 1933, as amended.

N.            Participant shall mean any Eligible Employee of a Participating Corporation who is actively participating in the Plan.

O.            Plan shall mean the Corporation’s International Employee Stock Purchase Plan, as set forth in this document.

P.            Plan Administrator shall mean the committee of two (2) or more non-employee Board members appointed by the Board to administer the Plan.

Q.            Purchase Date shall mean the last business day of each purchase period. The initial Purchase Date shall mean January 31, 1997.

 

2