Document:

exv10w6

 

Exhibit 10.6

FIFTH AMENDMENT

TO THE

MICHAELS STORES, INC.

EMPLOYEES 401(k) PLAN

(As Amended and Restated Effective August 1, 1999)

     Michaels Stores, Inc., a Delaware corporation, pursuant to authority of the Michaels Stores, Inc.
Administration Committee, adopts the following amendments to the Michaels Stores, Inc. Employees
401(k) Plan (the “Plan”).

     1. Section 9.6 of the Plan (“Direct Rollovers”) is amended by adding a new subsection thereto to
read as follows:

     (e) In the event of a mandatory distribution greater than $1,000 in accordance with
the provisions of Section 9.2(b), if the Participant does not elect to have such
distribution paid directly to an eligible retirement plan specified by the Participant in a
direct rollover or to receive the distribution directly, then the Plan will pay the
distribution in a direct rollover to an individual retirement plan designated by the
Administration Committee.

     2. The foregoing amendment will be effective with respect to distributions made on or after March
28, 2005.

     Executed this 15th day of March, 2005.

	 	 	 	 	 
	 	MICHAELS STORES, INC.

 	 
	 	By:  	/s/ Sue Elliot
 	 
	 	 	Name:  	Sue Elliot 	 
	 	 	Title:  	Senior Vice President - Human Resourcesexv10w8

 

EXHIBIT
10.8

MICHAELS STORES, INC.

SECOND AMENDED AND RESTATED

1997 EMPLOYEES STOCK PURCHASE PLAN

     The purpose of this Second Amended and Restated 1997 Employees Stock Purchase Plan (the
“Plan”) is to provide employees of Michaels Stores, Inc. (the “Company”) a continued opportunity to
purchase shares of the Company’s common stock, par value $0.10 per share (the “Common Stock”). The
Plan as amended and restated herein will become effective on February 1, 2006. Four million shares
of Common Stock in the aggregate have been approved for this purpose, reduced by the number of
shares of Common Stock (adjusted for stock splits) purchased under the Plan prior to February 1,
2006.

	1.	 	      Administration. The Plan will be administered by the Compensation Committee of the Board of
Directors of the Company. The Compensation Committee will have authority to make rules and
regulations for the administration of the Plan, and the Compensation Committee’s
interpretations and decisions with regard to the Plan will be final and conclusive. The
Compensation Committee may delegate the responsibility for the day-to-day administration of
the Plan to the Company’s Benefits Department, provided that the Benefits Department will at
all times remain subject to the supervision of the Compensation Committee.
	 
	2.	 	     Eligibility and Participation.

	 	(a)	 	     Employees of the Company and, at the discretion of the Compensation Committee,
employees of one or more subsidiaries of the Company, will be eligible to participate
in the Plan, in accordance with such rules as may be prescribed by the Compensation
Committee from time to time, which rules, however, will neither permit nor deny
participation in the Plan contrary to the requirements of Section 423(b) of the
Internal Revenue Code of 1986, as amended (the “Code”), and regulations promulgated
thereunder. As used in the Plan, the term “subsidiary” has the meaning set forth in
Section 424(f) of the Code.
	 
	 	(b)	 	     Each employee who elects to participate in an offering under the Plan will be
granted an option for as many whole and fractional shares of Common Stock as the
employee may purchase in such offering with the payroll deductions authorized pursuant
to Section 4. The date on which such option will be deemed to have been granted is the
first day of the offering period or, if the employee authorizes payroll deductions with
respect to an offering period after the first day of such period, the date on which the
employee authorizes such deductions.
	 
	 	(c)	 	     No employee may be granted an option if such employee, immediately after the
option is granted, owns 5% or more of the total combined voting power or value of the
stock of the Company or of any subsidiary. For purposes of the preceding sentence, the
rules of Section 424(d) of the Code will apply in determining the stock ownership of an
employee, and stock which the employee may purchase under outstanding options will be treated as stock owned by the
employee.

 

 

	 
	 	(d)	 	     No employee may be granted an option that permits his or her right to purchase
stock under all employee stock purchase plans of the Company and its subsidiaries to
accrue at a rate that exceeds $25,000 of the fair market value of such stock
(determined at the time the option is granted) for each calendar year in which the
option is outstanding at any time.

	3.	 	     Offerings. The Company will make monthly offerings to employees to purchase Common Stock
under the Plan. The first such monthly offering will begin on February 1, 2006, and will end
on the last bi-weekly pay date in February determined in accordance with the Company’s
customary payroll practice. Each subsequent offering period will begin on the day after the
last bi-weekly pay date of each calendar month and will end on the last bi-weekly pay date of
the immediately following calendar month determined in accordance with the Company’s customary
payroll practice.
	 
	4.	 	     Payroll Deductions. With respect to each offering under the Plan, an employee may authorize
payroll deductions in whole percentages up to a maximum of 15% of the basic or regular rate of
compensation the employee receives during the offering period or during such portion of the
offering period as the employee may elect to participate. An employee may increase, decrease
or discontinue payroll deductions in accordance with such rules as may be prescribed by the
Compensation Committee from time to time. An employee’s payroll deductions authorized with
respect to an offering will apply to each subsequent offering until modified or discontinued
by the employee. All payroll deductions will be credited to a recordkeeping account
maintained for the employee until applied to purchase shares of Common Stock. The employee’s
payroll deductions will not be credited with interest or any other earnings pending the
purchase of Common Stock and may be used by the Company for any corporate purpose.
	 
	5.	 	     Purchase of Shares. The payroll deductions credited to an employee’s account will be applied
to purchase shares of Common Stock on the last bi-weekly pay date of each calendar month or,
if such pay date is not a day on which the New York Stock Exchange (the “NYSE”) is open for
trading, on the next succeeding day on which the NYSE is open for trading (the “Purchase
Date”). The purchase price for each share purchased will be 85% of the closing price of the
Common Stock as reported on the NYSE on the Purchase Date. Common Stock may be purchased from
the Company or any affiliate of the Company or in the open market. The shares of Common Stock
purchased for an employee will be credited to an account established in the name of the
employee with a broker or other third party recordkeeper selected by the Compensation
Committee.
	 
	6.	 	     Withdrawal from Offering. An employee may withdraw from participation in an offering at any
time prior to the Purchase Date of the offering. Upon withdrawal from an offering, payroll
deductions will be discontinued as soon as administratively feasible. The employee may
request a withdrawal of the entire cash balance credited to the employee’s account, which will
be refunded to the employee to the extent administratively feasible. Partial withdrawals from an employee’s account are not
permitted. If an employee does not request a withdrawal of the balance of the payroll
deductions credited to the employee’s account, or if the refund of such balance is not
administratively feasible, such balance will be applied to the purchase of Common Stock on
the next Purchase Date.

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	7.	 	     Maintenance of Accounts. The Company will maintain or will cause to be maintained (i) an
account for each employee to which will be credited the employee’s payroll deductions for any
offering period and (ii) an account with a broker or other third party recordkeeper to which
will be credited the shares of Common Stock purchased under the Plan for the employee. Shares
of Common Stock credited to the employee’s account will be held in street name until
certificates for such shares are requested by the employee.
	 
	8.	 	     Registration of Certificates. The Company will cause its transfer agent to issue
certificates representing shares of Common Stock purchased for an employee upon the employee’s
written request, or in the event of the employee’s death, upon written request of the executor
or other personal representative of the employee’s estate. Certificates will be registered in
the name of the employee or in such other manner designated by the employee or personal
representative and acceptable to the transfer agent.
	 
	9.	 	     Dividend Reinvestment. Except as otherwise provided in this Section 9, dividends paid with
respect to shares of Common Stock in the employee’s account will automatically be reinvested
in additional shares of Common Stock, and such additional shares of Common Stock will also be
credited to the employee’s account. If an employee wishes to receive dividends on such Common
Stock in cash, the employee must request that certificates for such shares be issued pursuant
to the provisions of Section 8. Shares of Common Stock purchased with dividends may be
purchased from the Company or any affiliate of the Company or in the open market. If
purchased from the Company or an affiliate of the Company, the purchase price of the shares
will be the closing price of the Common Stock as reported on the NYSE on the date dividends
are paid. If purchased in the open market, the purchase price will be the average purchase
price of all shares purchased with the aggregate amount of dividends reinvested under the
Plan. Any fees or costs associated with the reinvestment of dividends will be deducted from
such dividends prior to purchasing shares of Common Stock.
	 
	10.	 	     Rights as a Stockholder. No employee will have the rights or privileges of a stockholder of
the Company with respect to shares purchased under the Plan unless and until the employee’s
ownership of such shares has been appropriately evidenced on the books of the Company.
	 
	11.	 	     Rights on Retirement, Death, or Termination of Employment. In the event of an employee’s
retirement, death, or termination of employment, any option then held by the employee will
terminate immediately, and no further payroll deductions will be taken from any pay due and
owing to the employee after the employee has been removed from the active employee payroll.
The employee or the employee’s personal representative, in the event of death, may request a
withdrawal of any payroll deductions then credited to the employee’s account, and such deductions will be refunded, to the extent administratively
feasible. If a refund is not administratively feasible, the payroll deductions will be
applied to the purchase of Common Stock on the next Purchase Date. Any shares of Common
Stock then credited to the employee’s account will be issued upon request in accordance with
the provisions of Section 8.

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	12.	 	     Rights Not Transferable. No option or other right under the Plan or under an offering may
be transferred by an employee other than by will or the laws of descent and distribution and
may be exercised during the employee’s lifetime only by the employee.
	 
	13.	 	     Adjustments. The Compensation Committee may make or provide for such adjustments in the
maximum number of shares of Common Stock reserved for issuance under the Plan as the
Compensation Committee in its discretion, exercised in good faith, may determine is equitably
required to prevent dilution or enlargement of the rights of employees that otherwise would
result from (i) any stock dividend, stock split, combination of shares, recapitalization or
other change in the capital structure of the Company, or (ii) any merger, consolidation,
spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or
other distribution of assets, issuance of rights or warrants to purchase securities, or (iii)
any other corporate transaction or event having an effect similar to any of the foregoing.
	 
	14.	 	     Amendment of the Plan. The Board of Directors may at any time, or from time to time, amend
the Plan in any respect, except that, without the approval of the stockholders of the Company
not later than 12 months after the date of adoption of such amendment by the Board of
Directors, no amendment will be effective if it would (i) increase or decrease the number of
shares approved for the Plan (other than as provided in Section 13) or (ii) change the
designation of subsidiaries eligible to participate in the Plan.
	 
	15.	 	     Termination of the Plan. The Plan and all rights of employees under any offering hereunder
will terminate (i) on the date that employees become entitled to purchase a number of shares
of Common Stock equal to or greater than the number of shares of Common Stock remaining
available for purchase under the Plan, unless extended by the Board of Directors, or (ii) at
any time, at the discretion of the Board of Directors. If on the date the Plan terminates
employees are entitled to purchase a number of shares of Common Stock greater than the number
of shares of Common Stock remaining available for purchase under the Plan, the available
shares will be allocated by the Compensation Committee among such employees in such manner as
it deems fair. Upon termination of the Plan, all remaining payroll deductions credited to an
employee’s account will be promptly refunded.
	 
	16.	 	     Governmental Regulations. The Company’s obligation to sell and deliver Common Stock under
the Plan is subject to the approval of any governmental authority required in connection with
the authorization, issuance, or sale of such Common Stock.

	 	 	 	 	 	 	 
	 	 	MICHAELS STORES, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ R. Michael Rouleau	 	 
	 
	 	Name:	 	R. Michael Rouleau	 	 
	 

	 	Title:	 	President and Chief Executive
Officer	 	 

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