DELAWARE | 62-1644402 | |
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
Title of Each Class: | Name of Each Exchange on Which Registered: | |
Class A Common Stock,
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New York Stock Exchange | |
Par Value $.01 Per Share
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ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS | 18 | |||||||
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ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 22 | |||||||
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ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE | 74 | |||||||
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SIGNATURES
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CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
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CERTIFICATION BY PRINCIPAL EXECUTIVE OFFICER (SOX 302)
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CERTIFICATION BY PRINCIPAL FINANCIAL OFFICER (SOX 302)
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CERTIFICATION BY PRINCIPAL EXECUTIVE OFFICER (SOX 906)
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CERTIFICATION BY PRINCIPAL FINANCIAL OFFICER (SOX 906)
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EXHIBIT 10.6 | ||||||||
EXHIBIT 10.9 | ||||||||
EXHIBIT 10.10 | ||||||||
EXHIBIT 10.39 | ||||||||
EXHIBIT 21.1 | ||||||||
EXHIBIT 23.1 | ||||||||
EXHIBIT 31.1 | ||||||||
EXHIBIT 31.2 | ||||||||
EXHIBIT 32.1 | ||||||||
EXHIBIT 32.2 |
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ITEM 1. | BUSINESS |
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| Global Market Reach. We are the largest IT distributor in the world, by net sales, and believe that we are the market share leader, by net sales, in North America, Asia-Pacific, and Latin America and a strong number two in Europe. Ingram Micro is the only global full-line distributor with operations in the Asia-Pacific region. Our broad global footprint enables us to serve our resellers and suppliers with our extensive sales and distribution network while mitigating the risks inherent in individual markets. |
We have local sales offices and/or Ingram Micro sales representatives in 34 countries, and sell our products and services to resellers in more than 140 countries. We have local sales offices and/or Ingram Micro sales representatives in North America (United States and Canada), Europe (Austria, Belgium, Denmark, Finland, France, Germany, Hungary, Italy, The Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and United Kingdom), Asia-Pacific (Australia, Bangladesh, the Peoples Republic of China including Hong Kong, India, Indonesia, Malaysia, New Zealand, Pakistan, Philippines, Singapore, Sri Lanka, and Thailand), and Latin America (Argentina, Brazil, Chile, Mexico, and Peru). We have sales agents, parties who act on our behalf, or primary supplier relationships with independent third parties in Costa Rica, Dominican Republic, Ecuador, Guatemala, and Trinidad/ Tobago. Additionally, we serve markets where we do not have an in-country presence through our various sales offices, including our general telesales operations in various geographies. | |
As of December 31, 2005, we had 89 distribution centers worldwide. We offer our more than 1,300 suppliers access to a global customer base of over 160,000 resellers of various categories including value-added resellers (VARs), corporate resellers, direct marketers, retailers, Internet-based resellers, and government and education resellers. | |
For a discussion of our geographic reporting segments, see Item 8. Financial Statements and Supplemental Data. For a discussion of foreign exchange risks relating to our international operations, see Item 7A. Quantitative and Qualitative Disclosures about Market Risk. |
| Business Diversification. |
| Products. In addition to our extensive market reach, our broad base of products allows us to better serve our customers as well as mitigate risk. Based on publicly available information, we believe we offer the largest breadth of products in the IT industry. We continuously focus on refreshing our |
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business with new, high-potential products and services. Our recent entry into several adjacent product segments demonstrates this commitment. Our acquisition of certain assets of Nimax in 2004 established a foothold in the growing AIDC/ POS solutions market. During 2005, we acquired certain assets of AVAD, which is the leading distributor for solution providers and custom installers serving the home automation and entertainment market in the United States. The custom installer market represents one of the fastest growing and most profitable segments of consumer electronics (CE). To complement this effort, we are pursuing new relationships with CE manufacturers to bring new lines of converging technologies to solution providers, direct marketers, e-tailers, and retailers on a global basis. Recognizing the heightened demand for real-time, broadly available communications for consumers and businesses, we continue to focus on expansion of our global reach in the mobile convergence market. |
| Services. In addition to a broad range of products we offer through our traditional distribution model, we provide supply chain solutions tailored to accommodate the needs of both product manufacturers as well as online and traditional retail businesses who are focused on increasing supply chain efficiencies, lowering overhead costs, and maximizing profits. We help our supply chain clients deliver products to key customers and new markets on a fee-for-service basis, leveraging over 20 years of experience in our core distribution activities. Services vary depending on customer requirements and can include end-to-end order management and fulfillment, warehousing and storage, reverse logistics, transportation management, and customer care. | |
| Customers. Our focus on diversification extends to the wide-ranging customers we serve. In each of our regions we sell to a diverse group of customer segments. We try to limit exposure to the impact of business fluctuations by maintaining a balance in the customer types we serve. This diversification strategy has been enhanced with our additional focus on AIDC/ POS, CE, and mobility products, which offer new customer segments for our products. We target market segments that provide growth opportunities for existing customers and vendors. The small-to-medium sized business (SMB) customer segment is generally one of the largest segments of the IT market in terms of revenue, and typically provides higher gross margins for distributors. SMB customers tend to upgrade or add systems often and employ VARs and other service providers for technology solutions in lieu of using an in-house IT staff. The needs of SMB resellers in serving the highly fragmented SMB end-user market are well addressed by our distribution model. Our programs and services are geared to add value to VARs in a number of ways. We serve VARs with a complete go-to-market approach to a VARs business, including sales, marketing and technical support, with special focus on the integration of field engineers, training, solutions development, as well as expanding their end-user reach. We also continue to develop solutions and services for our broad base of government and education resellers. |
| Strong Working Capital Management and Financial Position. We have consistently demonstrated strong working capital management in both positive and difficult economic conditions. In particular, we have maintained a strong focus on optimizing our investment in inventory, while preserving customer fill rates and service levels. We significantly reduced our inventory days on hand, and have maintained a stable range for five years as a result of our focused and sustainable initiatives towards minimizing excess and obsolete goods while improving buying patterns on our product flow. Furthermore, we continue to manage our accounts receivable generally through collections, credit limit setting, customer terms and process efficiencies to minimize our working capital requirements. Our business process improvement programs have also resulted in improving profitability and higher returns on invested capital, while providing us with a solid foundation for growth. Based on the strength of our consolidated balance sheet and improving profit trends, we also believe that we are well positioned to support our growth initiatives in our core business and invest in incremental profitable growth opportunities. Finally, we believe our solid financial position provides us with a competitive advantage as a reliable, long-term business partner for our supplier and reseller partners. | |
| Competitive Differentiation through Superior Execution. We are committed to enhancing customer loyalty and share of business by continually strengthening our value proposition. Through our |
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understanding and fulfillment of the needs of our reseller and supplier partners, we provide our customers with the supply chain tools they require to increase the efficiency of their operations, enabling them to minimize inventory levels, improve customer delivery, and enhance profitability. We provide business information to our customers, suppliers, and end-users by leveraging our information systems. We give resellers, and in some cases their customers, real-time access to our product inventory data. By providing improved visibility to all participants in the supply chain, we allow inventory levels throughout the channel to more closely reflect end-user demand. This information flow enables our superior execution and our ability to provide favorable order fill rates to our customers around the world while optimizing our investment in working capital. |
Our commitment to outperform our peers in all geographies through superior execution and a customer-centric focus has been widely recognized throughout the IT industry, as evidenced by a number of awards received by Ingram Micro during 2005. In the United States, we were named the Best Performing Distributor in Performance, Logistics and Products by Computer Reseller News most recent Sourcing Study Top 50 Preferred Sources. Trade magazines in other regions have also awarded many of our regional operations with a variety of honors. For example, Ingram Micro Germany was named in the top ten of Germanys Best Employers within the 501-5000 associates segment by Capital magazine and won seven of eight categories in the Channel Champion Study, by Computer Partner. Computer Reseller News Brazil recognized our Brazilian operation as Preferred Distributor in twenty-eight categories. Our vendors have recognized our efforts, as well. For example, for the third year in a row, IBMs Personal Computing Division recognized Ingram Micro for being its top distribution partner for the Americas and for achieving the leading market share position in the United States at the annual IBM Partnerworld conference in March 2005. Concurrently, Tech Pacific Ltd., acquired by Ingram Micro in November 2004, was recognized with an IBM Beacon award for the companys success in delivering the right IBM products, solutions and services to the Asia-Pacific marketplace and keeping customer satisfaction and value high. |
| Continuous Focus on Optimizing Productivity. We are constantly seeking ways to improve our operations by enhancing our capabilities while reducing costs to provide an efficient flow of products and services. For example, during 2005, we launched an outsourcing and optimization plan to significantly improve operating efficiencies and realign and consolidate select business operations in North America. A key component of the plan is an outsourcing arrangement to create a more variable cost structure by outsourcing transaction-oriented service and support functions to lower-cost geographies outside North America and realigning and consolidating key customer-facing teams for a closer working relationship within Ingram Micros North America locations. |
We leverage our IT systems and warehouse locations to support custom shipment requirements, and by optimizing delivery methodologies, we deliver faster, while reducing shipping costs. We remain focused on ensuring that our catalog includes the products most desired by our customers, optimizing inventory management, realizing higher margin opportunities, and developing merchandising and pricing strategies that produce enhanced business results. We continue to drive productivity gains through employing the Six Sigma methodology globally. |
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| Networking: 10-15% | |
| Software: 15-20% | |
| Systems: 24-29% | |
| Peripherals and Other: 40-45% |
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| ability to tailor specific solutions to customer needs; | |
| availability of technical and product information; | |
| credit terms and availability; | |
| effectiveness of sales and marketing programs; | |
| price; | |
| products and services availability; |
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| quality and breadth of product lines and services; and | |
| speed and accuracy of delivery. |
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Name | Age | Position | ||||
Gregory M.E. Spierkel
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49 | Chief Executive Officer | ||||
Kevin M. Murai
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42 | President and Chief Operating Officer | ||||
Keith W. F. Bradley
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42 | Executive Vice President and President, Ingram Micro North America | ||||
William D. Humes
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41 | Executive Vice President and Chief Financial Officer | ||||
Henri T. Koppen
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63 | Executive Vice President and President, Ingram Micro Europe | ||||
Alain Monié
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55 | Executive Vice President and President, Ingram Micro Asia-Pacific | ||||
Larry C. Boyd
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53 | Senior Vice President, Secretary and General Counsel | ||||
Alain Maquet
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53 | Senior Vice President and President, Ingram Micro Latin America | ||||
Karen E. Salem
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44 | Senior Vice President and Chief Information Officer | ||||
Matthew A. Sauer
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58 | Senior Vice President, Human Resources | ||||
Ria M. Carlson
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44 | Corporate Vice President, Strategy and Communications | ||||
James F. Ricketts
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58 | Corporate Vice President and Treasurer |
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ITEM 1A. | RISK FACTORS |
| speeches and calls with market analysts, | |
| conferences, meetings and calls with investors and potential investors in our securities, and | |
| other meetings and conferences. |
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| seasonal variations in the demand for our products and services such as lower demand in Europe during the summer months, worldwide pre-holiday stocking in the retail channel during the September-to-December period and the seasonal increase in demand for our North American fee-based logistics related services in the fourth quarter which affects our operating expenses and margins; | |
| competitive conditions in our industry, which may impact the prices charged and terms and conditions imposed by our suppliers and/or competitors and the prices we charge our customers, which in turn may negatively impact our revenues and/or gross margins; | |
| currency fluctuations in countries in which we operate; | |
| variations in our levels of excess inventory and doubtful accounts, and changes in the terms of vendor-sponsored programs such as price protection and return rights; |
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| changes in the level of our operating expenses; | |
| the impact of acquisitions we may make; | |
| the impact of and possible disruption caused by reorganization efforts, as well as the related expenses and/or charges; | |
| the loss or consolidation of one or more of our major suppliers or customers; | |
| product supply constraints; | |
| interest rate fluctuations, which may increase our borrowing costs and may influence the willingness of customers and end-users to purchase products and services; and | |
| general economic or geopolitical conditions. |
ITEM 1B. | UNRESOLVED STAFF COMMENTS |
ITEM 2. | PROPERTIES |
ITEM 3. | LEGAL PROCEEDINGS |
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ITEM 4. | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS |
ITEM 5. | MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS |
High | Low | |||||||||||
Fiscal Year 2005
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First Quarter | $ | 20.00 | $ | 16.30 | |||||||
Second Quarter | 17.41 | 14.66 | ||||||||||
Third Quarter | 18.65 | 15.43 | ||||||||||
Fourth Quarter | 20.00 | 17.30 | ||||||||||
Fiscal Year 2004
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First Quarter | $ | 19.55 | $ | 15.88 | |||||||
Second Quarter | 18.45 | 11.93 | ||||||||||
Third Quarter | 16.28 | 12.89 | ||||||||||
Fourth Quarter | 20.80 | 16.24 |
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(a) | (b) | (c) | ||||||||||
Number | Weighted-Average | Number of Securities | ||||||||||
of Securities | Exercise | Remaining Available for | ||||||||||
to be Issued | Price of | Future Issuance under | ||||||||||
upon Exercise | Outstanding | Equity Compensation | ||||||||||
of Outstanding | Options, | Plans (Excluding | ||||||||||
Options, Warrants | Warrants | Securities Reflected | ||||||||||
Plan Category | and Rights | and Rights | in Column (a)) | |||||||||
Equity compensation plans approved by shareowners
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30,558,305 | $ | 15.79 | 18,264,152 | ||||||||
Equity compensation plans not approved by shareowners
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None | None | None | |||||||||
TOTAL
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30,558,305 | $ | 15.79 | 18,264,152 |
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ITEM 6. | SELECTED FINANCIAL DATA |
2005 | 2004 | 2003 | 2002 | 2001 | |||||||||||||||||
(Dollars in 000s, except per share data) | |||||||||||||||||||||
Selected Operating Information
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Net sales
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$ | 28,808,312 | $ | 25,462,071 | $ | 22,613,017 | $ | 22,459,265 | $ | 25,186,933 | |||||||||||
Gross profit
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1,574,978 | 1,402,042 | 1,223,488 | 1,231,638 | 1,329,899 | ||||||||||||||||
Income from operations(1)
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362,186 | 283,367 | 156,193 | 50,208 | 92,930 | ||||||||||||||||
Income before income taxes and cumulative effect of adoption of
a new accounting standard(2)
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301,937 | 263,276 | 115,794 | 8,998 | 11,691 | ||||||||||||||||
Income before cumulative effect of adoption of a new accounting
standard(3)
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216,906 | 219,901 | 149,201 | 5,669 | 6,737 | ||||||||||||||||
Net income (loss)(4)
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216,906 | 219,901 | 149,201 | (275,192 | ) | 6,737 | |||||||||||||||
Basic earnings per share income before cumulative
effect of adoption of a new accounting standard
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1.35 | 1.41 | 0.99 | 0.04 | 0.05 | ||||||||||||||||
Diluted earnings per share income before cumulative
effect of adoption of a new accounting standard
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1.32 | 1.38 | 0.98 | 0.04 | 0.04 | ||||||||||||||||
Basic earnings per share net income (loss)
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1.35 | 1.41 | 0.99 | (1.83 | ) | 0.05 | |||||||||||||||
Diluted earnings per share net income (loss)
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1.32 | 1.38 | 0.98 | (1.81 | ) | 0.04 | |||||||||||||||
Weighted average common shares outstanding:
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Basic
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160,262,465 | 155,451,251 | 151,220,639 | 150,211,973 | 147,511,408 | ||||||||||||||||
Diluted
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164,331,166 | 159,680,040 | 152,308,394 | 152,145,669 | 150,047,807 | ||||||||||||||||
Selected Balance Sheet Information(5)
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Cash and cash equivalents
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$ | 324,481 | $ | 398,423 | $ | 279,587 | $ | 387,513 | $ | 273,059 | |||||||||||
Total assets
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7,034,990 | 6,926,737 | 5,474,162 | 5,144,354 | 5,302,007 | ||||||||||||||||
Total debt(6)
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604,867 | 514,832 | 368,255 | 365,946 | 458,107 | ||||||||||||||||
Stockholders equity
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2,438,598 | 2,240,810 | 1,872,949 | 1,635,989 | 1,867,298 |
(1) | Includes reorganization costs of $16,276 in 2005, credit adjustment to reorganization costs of $2,896 in 2004 for previous actions and reorganization costs of $21,570, $71,135, and $41,411 in 2003, 2002 and 2001, respectively, as well as other major-program costs of $22,935, $23,363 and $43,944 in 2005, 2003 and 2002, respectively, charged to selling, general and administrative expenses, or SG&A expenses, and |
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$443 and $1,552 in 2003 and 2002, respectively, charged to costs of sales, which were incurred in the implementation of our broad-based reorganization plan, our comprehensive profit enhancement program and additional profit enhancement opportunities (see Note 3 to our consolidated financial statements). Fiscal 2003 also includes a charge of $20,000 related to the bankruptcy of Micro Warehouse in the United States, one of our former customers. | |
(2) | Includes items noted in footnote (1) above as well as a loss of $8,413 on the redemption of senior subordinated notes in 2005, a gain on forward currency hedge of $23,120 in 2004 related to our Australian dollar denominated purchase of Tech Pacific and a gain on sale of available-for-sale securities of $6,535 in 2002. |
(3) | Includes items noted in footnotes (1) and (2) above, as well as the reversal of a deferred tax liability of $2,385, $41,078 and $70,461 in 2005, 2004 and 2003, respectively, related to the gains on sale of available-for-sale securities (see Note 8 to our consolidated financial statements). |
(4) | Includes items noted in footnotes (1), (2), and (3) above, as well as the cumulative effect of adoption of a new accounting standard, net of income taxes, of $280,861 in 2002 relating to the adoption of Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets. |
(5) | All balance sheet data are given at end of period. |
(6) | Includes convertible debentures, senior subordinated notes, revolving credit facilities and other long-term debt including current maturities, but excludes off-balance sheet debt of $60,000, $75,000, and $222,253 at the end of fiscal years 2003, 2002, and 2001, respectively, which amounts represent all of the undivided interests in transferred accounts receivable sold to and held by third parties as of the respective balance sheet dates. |
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ITEM 7. | MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
Sales |
Gross Margin |
Selling General and Administrative Expenses or SG&A Expenses |
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Working Capital and Debt |
Acquisition of Tech Pacific |
Acquisition of AVAD |
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Fiscal Year | |||||||||||||||||||||||||
2005 | 2004 | 2003 | |||||||||||||||||||||||
Reorganization | Other Major- | Reorganization | Other Major- | Reorganization | Other Major- | ||||||||||||||||||||
Costs | Program Costs | Costs | Program Costs | Costs | Program Costs | ||||||||||||||||||||
North America
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$ | 9.7 | $ | 16.9 | $ | (2.2 | ) | $ | | $ | 11.2 | $ | 17.4 | ||||||||||||
Europe
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(0.1 | ) | | (1.0 | ) | | 9.2 | 6.4 | |||||||||||||||||
Asia-Pacific
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6.7 | 6.0 | 0.3 | | 0.1 | | |||||||||||||||||||
Latin America
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| | | | 1.1 | | |||||||||||||||||||
Total
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$ | 16.3 | $ | 22.9 | $ | (2.9 | ) | $ | | $ | 21.6 | $ | 23.8 | ||||||||||||
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| Accounts Receivable - We provide allowances for doubtful accounts on our accounts receivable for estimated losses resulting from the inability of our customers to make required payments. Changes in the financial condition of our customers or other unanticipated events, which may affect their ability to make payments, could result in charges for additional allowances exceeding our expectations. Our estimates are influenced by the following considerations: the large number of customers and their dispersion across wide geographic areas; the fact that no single customer accounts for 10% or more of our net sales; a continuing credit evaluation of our customers financial condition; aging of receivables, individually and in the aggregate; credit insurance coverage; the value and adequacy of collateral received from our customers in certain circumstances; and our historical loss experience. | |
| Vendor Programs - We receive funds from vendors for price protection, product rebates, marketing/promotion, infrastructure reimbursement and meet competition programs, which are recorded as adjustments to product costs, revenue, or SG&A expenses according to the nature of the program. Some of these programs may extend over one or more quarterly reporting periods. We accrue rebates or other vendor incentives as earned based on sales of qualifying products or as services are provided in accordance with the terms of the related program. Actual rebates may vary based on volume or other sales achievement levels, which could result in an increase or reduction in the estimated amounts previously accrued. We also provide reserves for receivables on vendor programs for estimated losses resulting from vendors inability to pay or rejections of claims by vendors. | |
| Inventories - Our inventory levels are based on our projections of future demand and market conditions. Any sudden decline in demand and/or rapid product improvements and technological changes could cause us to have excess and/or obsolete inventories. On an ongoing basis, we review for estimated excess or obsolete inventories and write down our inventories to their estimated net realizable value based upon our forecasts of future demand and market conditions. If actual market conditions are less favorable than our forecasts, additional inventory write-downs may be required. Our estimates are influenced by the following considerations: protection from loss in value of inventory under our vendor agreements, our ability to return to vendors only a certain percentage of our purchases as contractually stipulated, aging of inventories, a sudden decline in demand due to an economic downturn, and rapid product improvements and technological changes. | |
| Goodwill, Intangible Assets and Other Long-Lived Assets - We adopted the provisions of Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets (FAS 142) in 2002. FAS 142 eliminated the amortization of goodwill. FAS 142 requires that after the initial impairment review upon adoption, goodwill should be reviewed at least annually thereafter. In the fourth quarters of 2005, 2004 and 2003, we performed our annual impairment tests of goodwill in North America, Europe and Asia-Pacific. The valuation methodologies included, but were not limited to, estimated net present value of the projected future cash flows of these reporting units. In connection with these tests, valuations of the individual reporting units were obtained or updated from an independent third-party valuation firm. No impairment was indicated based on these tests. However, if actual results are substantially lower than our projections underlying these valuations, or if market discount rates increase, our future valuations could be adversely affected, potentially resulting in future impairment charges. | |
We also assess potential impairment of our goodwill, intangible assets and other long-lived assets when there is evidence that recent events or changes in circumstances have made recovery of an assets carrying value unlikely. The amount of an impairment loss would be recognized as the excess of the assets carrying value over its fair value. Factors which may cause impairment include significant changes in the manner of use of these assets, negative industry or economic trends, and significant underperformance relative to historical or projected future operating results. |
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| Income Taxes - As part of the process of preparing our consolidated financial statements, we estimate our income taxes in each of the taxing jurisdictions in which we operate. This process involves estimating our actual current tax expense together with assessing any temporary differences resulting from the different treatment of certain items, such as the timing for recognizing revenues and expenses, for tax and financial reporting purposes. These differences may result in deferred tax assets and liabilities, which are included in our consolidated balance sheet. We are required to assess the likelihood that our deferred tax assets, which include net operating loss carryforwards and temporary differences that are expected to be deductible in future years, will be recoverable from future taxable income or other tax planning strategies. If recovery is not likely, we must provide a valuation allowance based on our estimates of future taxable income in the various taxing jurisdictions, and the amount of deferred taxes that are ultimately realizable. | |
The provision for tax liabilities involves evaluations and judgments of uncertainties in the interpretation of complex tax regulations by various taxing authorities. In situations involving tax related uncertainties, such as our gains on sales of Softbank common stock (see Note 8 to our consolidated financial statements), we provide for tax liabilities unless we consider it probable that additional taxes will not be due. As additional information becomes available, or these uncertainties are resolved with the taxing authorities, revisions to these liabilities may be required, resulting in additional provision for or benefit from income taxes in our consolidated income statement. | ||
Our U.S. federal tax returns for the fiscal years 2000 and 1999 were closed in September 2004 and 2003, respectively, and certain state returns for fiscal years 2000 and 1999 were closed in the third and fourth quarters of 2004, which resolved the tax matters related to the gains on sales of Softbank common stock in 1999 and 2000 in those jurisdictions. Accordingly, we reversed the related federal and certain state deferred tax liabilities of $40.0 million and $1.1 million associated with the gains on the 2000 and 1999 sales in the third and fourth quarters of 2004, respectively, while we reversed the related federal deferred tax liability of $70.5 million associated with the gain on the 1999 sale in the third quarter of 2003, thereby reducing our income tax provisions for both years in the consolidated statement of income. In 2005, we also settled and paid tax liabilities of $1.4 million and $2.8 million associated with the gains realized in 2000 and 1999, respectively, with certain state tax jurisdictions and reversed tax liabilities of $1.0 million and $1.4 million related to gains in 2000 and 1999, respectively, for such tax jurisdictions. | ||
| Contingencies and Litigation - There are various claims, lawsuits and pending actions against us, not otherwise noted in Item 3, and which are incidental to our operations. If a loss arising from these actions is probable and can be reasonably estimated, we record the amount of the estimated loss. If the loss is estimated using a range within which no point is more probable than another, the minimum estimated liability is recorded. Based on current available information, we believe that the ultimate resolution of these actions will not have a material adverse effect on our consolidated financial statements (see Note 10 to our consolidated financial statements). As additional information becomes available, we assess any potential liability related to these actions and may need to revise our estimates. Future revisions of our estimates could materially impact our consolidated results of operations, cash flows or financial position. |
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2005 | 2004 | 2003 | |||||||||||||||||||||||
Net sales by geographic region:
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North America
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$ | 12,217 | 42.4 | % | $ | 11,777 | 46.3 | % | $ | 10,965 | 48.5 | % | |||||||||||||
Europe
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10,424 | 36.2 | 9,839 | 38.6 | 8,267 | 36.5 | |||||||||||||||||||
Asia-Pacific
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4,843 | 16.8 | 2,742 | 10.8 | 2,320 | 10.3 | |||||||||||||||||||
Latin America
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1,324 | 4.6 | 1,104 | 4.3 | 1,061 | 4.7 | |||||||||||||||||||
Total
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$ | 28,808 | 100.0 | % | $ | 25,462 | 100.0 | % | $ | 22,613 | 100.0 | % | |||||||||||||
2005 | 2004 | 2003 | |||||||||||||||||||||||
Operating income (loss) and operating margin by geographic
region:
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North America
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$ | 157.6 | 1.3 | % | $ | 130.3 | 1.1 | % | $ | 94.5 | 0.9 | % | |||||||||||||
Europe
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143.4 | 1.4 | 129.8 | 1.3 | 73.2 | 0.9 | |||||||||||||||||||
Asia-Pacific
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39.8 | 0.8 | 9.8 | 0.4 | (10.3 | ) | (0.4 | ) | |||||||||||||||||
Latin America
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21.4 | 1.6 | 13.5 | 1.2 | (1.2 | ) | (0.1 | ) | |||||||||||||||||
Total
|
$ | 362.2 | 1.3 | % | $ | 283.4 | 1.1 | % | $ | 156.2 | 0.7 | % | |||||||||||||
2005 | 2004 | 2003 | |||||||||||
Net sales
|
100.0 | % | 100.0 | % | 100.0 | % | |||||||
Cost of sales
|
94.5 | 94.5 | 94.6 | ||||||||||
Gross profit
|
5.5 | 5.5 | 5.4 | ||||||||||
Operating expenses:
|
|||||||||||||
Selling, general and administrative
|
4.1 | 4.4 | 4.6 | ||||||||||
Reorganization costs
|
0.1 | 0.0 | 0.1 | ||||||||||
Income from operations
|
1.3 | 1.1 | 0.7 | ||||||||||
Other expense, net
|
0.2 | 0.1 | 0.2 | ||||||||||
Income before income taxes
|
1.1 | 1.0 | 0.5 | ||||||||||
Provision for (benefits from) income taxes
|
0.3 | 0.2 | (0.2 | ) | |||||||||
Net income
|
0.8 | % | 0.8 | % | 0.7 | % | |||||||
27
28
29
Income | Diluted | |||||||||||||||||||||||||
Income | Before | Earnings | ||||||||||||||||||||||||
Net | Gross | From | Income | Net | Per | |||||||||||||||||||||
Sales | Profit | Operations | Taxes | Income | Share | |||||||||||||||||||||
(In millions, except per share data) | ||||||||||||||||||||||||||
Fiscal Year Ended December 31, 2005
|
||||||||||||||||||||||||||
Thirteen Weeks Ended:(1)
|
||||||||||||||||||||||||||
April 2, 2005
|
$ | 7,052.0 | $ | 379.5 | $ | 76.2 | $ | 61.5 | $ | 42.4 | $ | 0.26 | ||||||||||||||
July 2, 2005
|
6,840.5 | 367.5 | 71.3 | 57.2 | 41.7 | 0.26 | ||||||||||||||||||||
October 1, 2005
|
6,959.3 | 381.8 | 82.9 | 62.3 | 48.4 | 0.29 | ||||||||||||||||||||
December 31, 2005
|
7,956.5 | 446.2 | 131.7 | 120.9 | 84.4 | 0.51 | ||||||||||||||||||||
Fiscal Year Ended January 1, 2005
|
||||||||||||||||||||||||||
Thirteen Weeks Ended:(2)
|
||||||||||||||||||||||||||
April 3, 2004
|
$ | 6,275.6 | $ | 341.4 | $ | 66.6 | $ | 55.2 | $ | 37.6 | $ | 0.24 | ||||||||||||||
July 3, 2004
|
5,716.6 | 311.4 | 47.9 | 38.0 | 25.9 | 0.16 | ||||||||||||||||||||
October 2, 2004
|
6,016.4 | 329.6 | 60.2 | 54.9 | 77.3 | 0.49 | ||||||||||||||||||||
January 1, 2005
|
7,453.4 | 419.5 | 108.7 | 115.2 | 79.2 | 0.48 |
(1) | Includes impact of charges related to reorganization costs and other major-program costs as follows (pre-tax): first quarter, $9.8 million; second quarter, $14.0 million; third quarter, $7.2 million; fourth quarter, $8.2 million. The second quarter also includes the reversal of Softbank deferred tax liability of $2.2 million. The third quarter also includes a loss on the redemption of senior subordinated notes of |
30
$8.4 million. The fourth quarter also includes the reversal of Softbank deferred tax liability of $0.2 million. |
(2) | Includes impact of charges related to reorganization costs and adjustments (credits) related to previous restructuring actions as follows (pre-tax): first quarter, $0.1 million; second quarter, $0.1 million; third quarter, $(2.7) million; fourth quarter, $(0.4) million. The third quarter also includes a foreign-exchange gain of $4.3 million related to the acquisition of Tech Pacific in Asia-Pacific and the reversal of Softbank deferred tax liability of $40.0 million. The fourth quarter also includes a foreign-exchange gain of $18.8 million related to the acquisition of Tech Pacific in Asia-Pacific and the reversal of Softbank deferred tax liability of $1.1 million. |
Cash Flows |
31
Acquisitions |
32
Capital Resources |
On-Balance Sheet Capital Resources |
33
34
Off-Balance Sheet Capital Resources |
Covenant Compliance |
35
Contractual Obligations |
Payments Due by Period | |||||||||||||||||||||||||
Total | Balance | Less Than | 1-3 | 3-5 | After | ||||||||||||||||||||
Contractual Obligations | Capacity | Outstanding | 1 Year | Years | Years | 5 Years | |||||||||||||||||||
North American revolving accounts receivable-based financing
facilities(1)
|
$ | 629.0 | $ | 343.0 | $ | | $ | 343.0 | $ | | $ | | |||||||||||||
European revolving trade accounts receivable-backed financing
facilities(1)
|
397.0 | | | | | | |||||||||||||||||||
Asia-Pacific revolving trade accounts receivable-backed
financing facilities(1)
|
183.0 | 112.6 | | 112.6 | | | |||||||||||||||||||
Revolving senior unsecured credit facilities(2)
|
248.0 | 14.4 | 14.4 | | | | |||||||||||||||||||
Bank overdrafts and other(3)
|
593.0 | 134.8 | 134.8 | | | | |||||||||||||||||||
Subtotal
|
2,050.0 | 604.8 | 149.2 | 455.6 | | | |||||||||||||||||||
European accounts receivable financing programs(4)
|
209.0 | | | | | | |||||||||||||||||||
Minimum payments under operating leases and IT and business
process outsourcing agreements(5)
|
433.7 | 433.7 | 87.2 | 151.0 | 113.9 | 81.6 | |||||||||||||||||||
Total
|
$ | 2,692.7 | $ | 1,038.5 | $ | 236.4 | $ | 606.6 | $ | 113.9 | $ | 81.6 | |||||||||||||
(1) | The capacity amount in the table above represents the maximum capacity available under these facilities. Our actual capacity is dependent upon the actual amount of eligible trade accounts receivable that may be used to support these facilities. As of December 31, 2005, our actual aggregate capacity under these programs based on eligible accounts receivable was approximately $962 million (see Note 7 to our consolidated financial statements). |
(2) | The capacity amount in the table above represents the maximum capacity available under these facilities. These facilities can also be used to support letters of credit. At December 31, 2005, letters of credit totaling $21.2 million were issued to certain vendors to support purchases by our subsidiaries and to certain financial institutions to support banking lines for certain subsidiaries, or local borrowings from banks made available to certain of our subsidiaries. The issuance of these letters of credit reduces our available capacity by the same amount. |
(3) | Certain of these programs can also be used to support letters of credit. At December 31, 2005, letters of credit totaling approximately $53.4 million were issued to certain vendors to support purchases by our subsidiaries. The issuance of these letters of credit also reduces our available capacity by the same amount. |
(4) | The total capacity amount in the table above represents the maximum capacity available under these programs. Our actual capacity is dependent upon the actual amount of eligible trade accounts receivable that may be transferred or sold into these programs. As of December 31, 2005, our actual aggregate capacity under these programs based on eligible accounts receivable was approximately $207 million. |
(5) | In December 2002, we entered into an agreement with a third-party provider of IT outsourcing services. The services to be provided include mainframe, major server, desktop and enterprise storage operations, wide-area and local-area network support and engineering; systems management services; help desk |
36
services; and worldwide voice/ PBX. This agreement expires in December 2009, but is cancelable at our option subject to payment of termination fees. In September 2005, we entered into an agreement with a leading global business process outsource service provider. The services to be provided include selected North America positions in finance and shared services, customer service, vendor management and selected U.S. positions in technical support and inside sales (excluding field sales and management positions). This agreement expires in September 2010, but is cancelable at our option subject to payment of termination fees. Additionally, we lease the majority of our facilities and certain equipment under noncancelable operating leases. Renewal and purchase options at fair values exist for a substantial portion of the leases. Amounts in this table represent future minimum payments on operating leases that have remaining noncancelable lease terms in excess of one year as well as under the IT and business process outsourcing agreements. |
Other Matters |
37
38
39
Interest Rate | Currency Sensitive | |||||||||||
Sensitive Financial | Financial | Combined | ||||||||||
Instruments | Instruments | Portfolio | ||||||||||
VaR as of December 31, 2005
|
$ | 6.5 | $ | 0.2 | $ | 4.9 | ||||||
VaR as of January 1, 2005
|
8.7 | 0.4 | 6.5 |
ITEM 7A. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
ITEM 8. | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA |
Page | ||||
41 | ||||
42 | ||||
43 | ||||
44 | ||||
45 | ||||
71 | ||||
72 |
40
Fiscal Year End | |||||||||||
2005 | 2004 | ||||||||||
(Dollars in 000s, | |||||||||||
except share data) | |||||||||||
ASSETS | |||||||||||
Current assets:
|
|||||||||||
Cash and cash equivalents
|
$ | 324,481 | $ | 398,423 | |||||||
Trade accounts receivable (less allowances of $81,831 and
$93,465)
|
3,186,115 | 3,037,417 | |||||||||
Inventories
|
2,208,660 | 2,175,185 | |||||||||
Other current assets
|
352,042 | 471,137 | |||||||||
Total current assets
|
6,071,298 | 6,082,162 | |||||||||
Property and equipment, net
|
179,435 | 199,133 | |||||||||
Goodwill
|
638,416 | 559,665 | |||||||||
Other assets
|
145,841 | 85,777 | |||||||||
Total assets
|
$ | 7,034,990 | $ | 6,926,737 | |||||||
LIABILITIES AND STOCKHOLDERS EQUITY | |||||||||||
Current liabilities:
|
|||||||||||
Accounts payable
|
$ | 3,476,845 | $ | 3,536,880 | |||||||
Accrued expenses
|
479,422 | 607,684 | |||||||||
Current maturities of long-term debt
|
149,217 | 168,649 | |||||||||
Total current liabilities
|
4,105,484 | 4,313,213 | |||||||||
Long-term debt, less current maturities
|
455,650 | 346,183 | |||||||||
Other liabilities
|
35,258 | 26,531 | |||||||||
Total liabilities
|
4,596,392 | 4,685,927 | |||||||||
Commitments and contingencies (Note 10)
|
|||||||||||
Stockholders equity:
|
|||||||||||
Preferred Stock, $0.01 par value, 25,000,000 shares
authorized; no shares issued and outstanding
|
| | |||||||||
Class A Common Stock, $0.01 par value,
500,000,000 shares authorized; 162,366,283 and
158,737,898 shares issued and outstanding in 2005 and 2004,
respectively
|
1,624 | 1,587 | |||||||||
Class B Common Stock, $0.01 par value,
135,000,000 shares authorized; no shares issued and
outstanding
|
| | |||||||||
Additional paid-in capital
|
874,984 | 817,378 | |||||||||
Retained earnings
|
1,538,761 | 1,321,855 | |||||||||
Accumulated other comprehensive income
|
23,324 | 99,990 | |||||||||
Unearned compensation
|
(95 | ) | | ||||||||
Total stockholders equity
|
2,438,598 | 2,240,810 | |||||||||
Total liabilities and stockholders equity
|
$ | 7,034,990 | $ | 6,926,737 | |||||||
41
Fiscal Year | |||||||||||||
2005 | 2004 | 2003 | |||||||||||
(Dollars in 000s, except per share data) | |||||||||||||
Net sales
|
$ | 28,808,312 | $ | 25,462,071 | $ | 22,613,017 | |||||||
Cost of sales
|
27,233,334 | 24,060,029 | 21,389,529 | ||||||||||
Gross profit
|
1,574,978 | 1,402,042 | 1,223,488 | ||||||||||
Operating expenses:
|
|||||||||||||
Selling, general and administrative
|
1,196,516 | 1,121,571 | 1,045,725 | ||||||||||
Reorganization costs
|
16,276 | (2,896 | ) | 21,570 | |||||||||
1,212,792 | 1,118,675 | 1,067,295 | |||||||||||
Income from operations
|
362,186 | 283,367 | 156,193 | ||||||||||
Other expense (income):
|
|||||||||||||
Interest income
|
(4,249 | ) | (7,354 | ) | (9,933 | ) | |||||||
Interest expense
|
48,957 | 37,509 | 33,447 | ||||||||||
Losses on sales of receivables
|
1,552 | 5,015 | 10,206 | ||||||||||
Net foreign exchange loss (gain)
|
961 | (19,501 | ) | 3,695 | |||||||||
Loss on redemption of senior subordinated notes
|
8,413 | | | ||||||||||
Other
|
4,615 | 4,422 | 2,984 | ||||||||||
60,249 | 20,091 | 40,399 | |||||||||||
Income before income taxes
|
301,937 | 263,276 | 115,794 | ||||||||||
Provision for (benefit from) income taxes
|
85,031 | 43,375 | (33,407 | ) | |||||||||
Net income
|
$ | 216,906 | $ | 219,901 | $ | 149,201 | |||||||
Basic earnings per share
|
$ | 1.35 | $ | 1.41 | $ | 0.99 | |||||||
Diluted earnings per share
|
$ | 1.32 | $ | 1.38 | $ | 0.98 | |||||||
42
Accumulated | ||||||||||||||||||||||||
Other | ||||||||||||||||||||||||
Common | Additional | Comprehensive | ||||||||||||||||||||||
Stock | Paid-In | Retained | Income | Unearned | ||||||||||||||||||||
Class A | Capital | Earnings | (Loss) | Compensation | Total | |||||||||||||||||||
(Dollars in 000s) | ||||||||||||||||||||||||
December 28, 2002
|
$ | 1,508 | $ | 707,689 | $ | 952,753 | $ | (25,548 | ) | $ | (413 | ) | $ | 1,635,989 | ||||||||||
Stock options exercised
|
11 | 10,251 | 10,262 | |||||||||||||||||||||
Income tax benefit from exercise of stock options
|
1,151 | 1,151 | ||||||||||||||||||||||
Grant of restricted Class A Common Stock
|
460 | (460 | ) | | ||||||||||||||||||||
Issuance of Class A Common Stock related to Employee Stock
Purchase Plan
|
1 | 474 | 475 | |||||||||||||||||||||
Stock-based compensation expense
|
785 | 726 | 1,511 | |||||||||||||||||||||
Comprehensive income
|
149,201 | 74,360 | 223,561 | |||||||||||||||||||||
January 3, 2004
|
1,520 | 720,810 | 1,101,954 | 48,812 | (147 | ) | 1,872,949 | |||||||||||||||||
Stock options exercised
|
66 | 84,452 | 84,518 | |||||||||||||||||||||
Income tax benefit from exercise of stock options
|
10,099 | 10,099 | ||||||||||||||||||||||
Grant of restricted Class A Common Stock
|
589 | (589 | ) | | ||||||||||||||||||||
Issuance of Class A Common Stock related to Employee Stock
Purchase Plan
|
1 | 757 | 758 | |||||||||||||||||||||
Stock-based compensation expense
|
935 | 736 | 1,671 | |||||||||||||||||||||
Surrender of restricted Class A Common Stock associated
with payment of withholding tax
|
(264 | ) | (264 | ) | ||||||||||||||||||||
Comprehensive income
|
219,901 | 51,178 | 271,079 | |||||||||||||||||||||
January 1, 2005
|
1,587 | 817,378 | 1,321,855 | 99,990 | | 2,240,810 | ||||||||||||||||||
Stock options exercised
|
36 | 49,240 | 49,276 | |||||||||||||||||||||
Income tax benefit from exercise of stock options
|
6,584 | 6,584 | ||||||||||||||||||||||
Grant of restricted Class A Common Stock and stock units
|
1 | 1,031 | (1,032 | ) | | |||||||||||||||||||
Stock-based compensation expense
|
751 | 937 | 1,688 | |||||||||||||||||||||
Comprehensive income
|
216,906 | (76,666 | ) | 140,240 | ||||||||||||||||||||
December 31, 2005
|
$ | 1,624 | $ | 874,984 | $ | 1,538,761 | $ | 23,324 | $ | (95 | ) | $ | 2,438,598 | |||||||||||
43
Fiscal Year | |||||||||||||||
2005 | 2004 | 2003 | |||||||||||||
(Dollars in 000s) | |||||||||||||||
Cash flows from operating activities:
|
|||||||||||||||
Net income
|
$ | 216,906 | $ | 219,901 | $ | 149,201 | |||||||||
Adjustments to reconcile net income to cash provided
(used) by operating activities:
|
|||||||||||||||
Depreciation and amortization
|
64,338 | 57,657 | 78,519 | ||||||||||||
Gain on forward currency exchange contract
|
| (23,120 | ) | | |||||||||||
Noncash gains on disposals of property and equipment and
investments
|
| | (980 | ) | |||||||||||
Loss on sale of a business
|
| | 5,067 | ||||||||||||
Noncash charges for interest and compensation
|
2,775 | 3,135 | 3,218 | ||||||||||||
Loss on redemption of senior subordinated notes
|
8,413 | | | ||||||||||||
Deferred income taxes
|
16,824 | (25,853 | ) | (53,903 | ) | ||||||||||
Changes in operating assets and liabilities, net of effects of
acquisitions:
|
|||||||||||||||
Changes in amounts sold under accounts receivable programs
|
| (60,000 | ) | (15,000 | ) | ||||||||||
Accounts receivable
|
(219,692 | ) | (187,073 | ) | 95,248 | ||||||||||
Inventories
|
(37,428 | ) | (54,178 | ) | (245,070 | ) | |||||||||
Other current assets
|
122,729 | (77,885 | ) | (812 | ) | ||||||||||
Accounts payable
|
10,531 | 368,156 | 34,626 | ||||||||||||
Accrued expenses
|
(177,175 | ) | 140,194 | (144,902 | ) | ||||||||||
Cash provided (used) by operating activities
|
8,221 | 360,934 | (94,788 | ) | |||||||||||
Cash flows from investing activities:
|
|||||||||||||||
Purchase of property and equipment
|
(38,842 | ) | (36,985 | ) | (35,003 | ) | |||||||||
Proceeds from sale of property and equipment
|
| | 7,826 | ||||||||||||
Proceeds from forward currency exchange contract
|
| 23,120 | | ||||||||||||
Acquisitions, net of cash acquired
|
(140,566 | ) | (402,181 | ) | (9,416 | ) | |||||||||
Other
|
| 4,501 | (307 | ) | |||||||||||
Cash used by investing activities
|
(179,408 | ) | (411,545 | ) | (36,900 | ) | |||||||||
Cash flows from financing activities:
|
|||||||||||||||
Proceeds from exercise of stock options
|
49,276 | 84,518 | 10,262 | ||||||||||||
Redemption of senior subordinated notes
|
(205,801 | ) | | | |||||||||||
Net proceeds from (repayments of) debt
|
305,838 | (12,760 | ) | (6,077 | ) | ||||||||||
Changes in book overdrafts
|
(28,932 | ) | 77,742 | 5,144 | |||||||||||
Cash provided by financing activities
|
120,381 | 149,500 | 9,329 | ||||||||||||
Effect of exchange rate changes on cash and cash equivalents
|
(23,136 | ) | 19,947 | 14,433 | |||||||||||
Increase (decrease) in cash and cash equivalents
|
(73,942 | ) | 118,836 | (107,926 | ) | ||||||||||
Cash and cash equivalents, beginning of year
|
398,423 | 279,587 | 387,513 | ||||||||||||
Cash and cash equivalents, end of year
|
$ | 324,481 | $ | 398,423 | $ | 279,587 | |||||||||
Supplemental disclosures of cash flow information:
|
|||||||||||||||
Cash payments during the year:
|
|||||||||||||||
Interest
|
$ | 50,281 | $ | 34,937 | $ | 38,581 | |||||||||
Income taxes
|
65,847 | 30,755 | 41,603 |
44
Note 1 | Organization and Basis of Presentation |
Note 2 | Significant Accounting Policies |
Basis of Consolidation |
Fiscal Year |
Use of Estimates |
Revenue Recognition |
Vendor Programs |
45
Warranties |
Foreign Currency Translation and Remeasurement |
Fair Value of Financial Instruments |
Cash and Cash Equivalents |
Inventories |
Property and Equipment |
46
Buildings
|
40 years | |
Leasehold improvements
|
3-17 years | |
Distribution equipment
|
5-10 years | |
Computer equipment and software
|
3-8 years |
Long-Lived and Intangible Assets |
Goodwill |
North | Asia- | Latin | |||||||||||||||||||
America | Europe | Pacific | America | Total | |||||||||||||||||
Balance at January 3, 2004
|
$ | 78,444 | $ | 9,308 | $ | 156,422 | $ | | $ | 244,174 | |||||||||||
Acquisitions
|
| 2,610 | 308,497 | | 311,107 | ||||||||||||||||
Foreign currency translation
|
51 | 857 | 3,476 | | 4,384 | ||||||||||||||||
Balance at January 1, 2005
|
78,495 | 12,775 | 468,395 | | 559,665 | ||||||||||||||||
Acquisitions
|
77,609 | 645 | 3,928 | | 82,182 | ||||||||||||||||
Foreign currency translation
|
28 | (1,693 | ) | (1,766 | ) | | (3,431 | ) | |||||||||||||
Balance at December 31, 2005
|
$ | 156,132 | $ | 11,727 | $ | 470,557 | $ | | $ | 638,416 | |||||||||||
47
Concentration of Credit Risk |
Derivative Financial Instruments |
48
Fiscal Year End | ||||||||||||||||
2005 | 2004 | |||||||||||||||
Notional | Estimated | Notional | Estimated | |||||||||||||
Amounts | Fair Value | Amounts | Fair Value | |||||||||||||
Foreign exchange forward contracts
|
$ | 1,486,538 | $ | 43,556 | $ | 1,401,648 | $ | (110,615 | ) | |||||||
Interest rate swaps
|
| | 739,741 | (4,131 | ) |
Comprehensive Income |
Fiscal Year | ||||||||||||
2005 | 2004 | 2003 | ||||||||||
Net income
|
$ | 216,906 | $ | 219,901 | $ | 149,201 | ||||||
Changes in foreign currency translation adjustments
|
(76,666 | ) | 51,178 | 74,360 | ||||||||
Comprehensive income
|
$ | 140,240 | $ | 271,079 | $ | 223,561 | ||||||
Earnings Per Share |
49
Fiscal Year | ||||||||||||
2005 | 2004 | 2003 | ||||||||||
Net income
|
$ | 216,906 | $ | 219,901 | $ | 149,201 | ||||||
Weighted average shares
|
160,262,465 | 155,451,251 | 151,220,639 | |||||||||
Basic earnings per share
|
$ | 1.35 | $ | 1.41 | $ | 0.99 | ||||||
Weighted average shares including the dilutive effect of stock
options and warrants (4,068,701; 4,228,789; and 1,087,755 for
2005, 2004, and 2003, respectively)
|
164,331,166 | 159,680,040 | 152,308,394 | |||||||||
Diluted earnings per share
|
$ | 1.32 | $ | 1.38 | $ | 0.98 | ||||||
Fiscal Year | |||||||||||||
2005 | 2004 | 2003 | |||||||||||
Net income, as reported
|
$ | 216,906 | $ | 219,901 | $ | 149,201 | |||||||
Compensation expense as determined under FAS 123,
net of related tax effects |
17,068 | 26,479 | 28,363 | ||||||||||
Pro forma net income
|
$ | 199,838 | $ | 193,422 | $ | 120,838 | |||||||
Earnings per share:
|
|||||||||||||
Basic as reported
|
$ | 1.35 | $ | 1.41 | $ | 0.99 | |||||||
Basic pro forma
|
$ | 1.25 | $ | 1.24 | $ | 0.80 | |||||||
Diluted as reported
|
$ | 1.32 | $ | 1.38 | $ | 0.98 | |||||||
Diluted pro forma
|
$ | 1.21 | $ | 1.21 | $ | 0.79 | |||||||
50
Fiscal Year | ||||||||||||
2005 | 2004 | 2003 | ||||||||||
Risk-free interest rate
|
3.71 | % | 2.72 | % | 1.90 | % | ||||||
Expected years until exercise
|
3.5 years | 3.0 years | 3.0 years | |||||||||
Expected stock volatility
|
41.8 | % | 41.8 | % | 49.3 | % |
51
52
Reorganization Costs |
Employee | ||||||||||||||||||||||
Headcount | Termination | Facility | Other | Total | ||||||||||||||||||
Year Ended | Reduction | Benefits | Costs | Costs | Cost | |||||||||||||||||
2005
|
||||||||||||||||||||||
North America
|
580 | $ | 7,219 | $ | 2,430 | $ | | $ | 9,649 | |||||||||||||
Europe
|
| (75 | ) | (7 | ) | | (82 | ) | ||||||||||||||
Asia-Pacific
|
320 | 4,082 | 2,127 | 500 | 6,709 | |||||||||||||||||
Latin America
|
| | | | | |||||||||||||||||
Total
|
900 | $ | 11,226 | $ | 4,550 | $ | 500 | $ | 16,276 | |||||||||||||
2004
|
||||||||||||||||||||||
North America
|
| $ | (125 | ) | $ | (2,109 | ) | $ | | $ | (2,234 | ) | ||||||||||
Europe
|
| (59 | ) | (919 | ) | | (978 | ) | ||||||||||||||
Asia-Pacific
|
30 | 316 | | | 316 | |||||||||||||||||
Latin America
|
| | | | | |||||||||||||||||
Total
|
30 | $ | 132 | $ | (3,028 | ) | $ | | $ | (2,896 | ) | |||||||||||
2003
|
||||||||||||||||||||||
North America
|
680 | $ | 6,417 | $ | 3,298 | $ | 1,519 | $ | 11,234 | |||||||||||||
Europe
|
165 | 2,658 | 6,780 | (236 | ) | 9,202 | ||||||||||||||||
Asia-Pacific
|
25 | 74 | | | 74 | |||||||||||||||||
Latin America
|
170 | 922 | 125 | 13 | 1,060 | |||||||||||||||||
Total
|
1,040 | $ | 10,071 | $ | 10,203 | $ | 1,296 | $ | 21,570 | |||||||||||||
Year ended December 31, 2005 |
53
Amounts Paid | Remaining | ||||||||||||||||
and Charged | Liability at | ||||||||||||||||
Reorganization | Against the | December 31, | |||||||||||||||
Costs | Liability | Adjustments | 2005 | ||||||||||||||
Employee termination benefits
|
$ | 11,301 | $ | 8,541 | $ | | $ | 2,760 | |||||||||
Facility costs
|
4,755 | 2,089 | | 2,666 | |||||||||||||
Other costs
|
500 | 500 | | | |||||||||||||
Total
|
$ | 16,556 | $ | 11,130 | $ | | $ | 5,426 | |||||||||
Year ended January 1, 2005 |
Year ended January 3, 2004 |
Outstanding | Amounts Paid | Remaining | |||||||||||||||
Liability at | and Charged | Liability at | |||||||||||||||
January 1, | Against the | December 31, | |||||||||||||||
2005 | Liability | Adjustments | 2005 | ||||||||||||||
Employee termination benefits
|
$ | 164 | $ | 164 | $ | | $ | | |||||||||
Facility costs
|
2,198 | 1,972 | 1,435 | 1,661 | |||||||||||||
Total
|
$ | 2,362 | $ | 2,136 | $ | 1,435 | $ | 1,661 | |||||||||
Actions prior to December 28, 2002 |
54
Outstanding | Amounts Paid | Remaining | |||||||||||||||
Liability at | and Charged | Liability at | |||||||||||||||
January 1, | Against the | December 31, | |||||||||||||||
2005 | Liability | Adjustments | 2005 | ||||||||||||||
Employee termination benefits
|
$ | 160 | $ | 25 | $ | (75 | ) | $ | 60 | ||||||||
Facility costs
|
9,508 | 4,020 | (1,640 | ) | 3,848 | ||||||||||||
Total
|
$ | 9,668 | $ | 4,045 | $ | (1,715 | ) | $ | 3,908 | ||||||||
Other Profit Enhancement Program Implementation Costs |
55
Purchase price:
|
|||||
Cash paid to sellers
|
$ | 385,022 | |||
Debt assumed (net of cash acquired)
|
162,866 | ||||
Acquisition costs
|
5,800 | ||||
$ | 553,688 | ||||
Tangible assets, including accounts receivable, inventories,
property and equipment and other assets
|
$ | 475,026 | ||
Goodwill
|
311,848 | |||
Identifiable intangible assets customer and vendor
relationships
|
36,000 | |||
Liabilities, including accounts payable and accrued expenses
|
(269,186 | ) | ||
Fair value of assets acquired and liabilities assumed
|
$ | 553,688 | ||
56
Fiscal Year | |||||||||
2004 | 2003 | ||||||||
Net sales
|
$ | 27,651,703 | $ | 24,842,426 | |||||
Net earnings
|
$ | 232,081 | $ | 160,450 | |||||
Earnings per share
|
|||||||||
Basic
|
$ | 1.49 | $ | 1.06 | |||||
Diluted
|
$ | 1.45 | $ | 1.05 | |||||
Note 5 | Accounts Receivable |
57
Note 6 | Property and Equipment |
Fiscal Year End | ||||||||
2005 | 2004 | |||||||
Land
|
$ | 2,041 | $ | 1,334 | ||||
Buildings and leasehold improvements
|
138,071 | 136,328 | ||||||
Distribution equipment
|
204,679 | 206,615 | ||||||
Computer equipment and software
|
284,505 | 291,097 | ||||||
629,296 | 635,374 | |||||||
Accumulated depreciation
|
(449,861 | ) | (436,241 | ) | ||||
$ | 179,435 | $ | 199,133 | |||||
Note 7 | Long-Term Debt |
Fiscal Year End | ||||||||
2005 | 2004 | |||||||
Senior subordinated notes
|
$ | | $ | 213,894 | ||||
North American revolving trade accounts receivable-backed
financing facilities
|
343,026 | | ||||||
Asia-Pacific revolving trade accounts receivable-backed
financing facilities
|
112,624 | 132,289 | ||||||
Revolving unsecured credit facilities and other debt
|
149,217 | 168,649 | ||||||
604,867 | 514,832 | |||||||
Current maturities of long-term debt
|
(149,217 | ) | (168,649 | ) | ||||
$ | 455,650 | $ | 346,183 | |||||
58
59
60
Note 8 | Income Taxes |
Fiscal Year | ||||||||||||
2005 | 2004 | 2003 | ||||||||||
United States
|
$ | 80,263 | $ | 85,757 | $ | 36,477 | ||||||
Foreign
|
221,674 | 177,519 | 79,317 | |||||||||
Total
|
$ | 301,937 | $ | 263,276 | $ | 115,794 | ||||||
Fiscal Year | |||||||||||||
2005 | 2004 | 2003 | |||||||||||
Current:
|
|||||||||||||
Federal
|
$ | 19,933 | $ | 23,173 | $ | 414 | |||||||
State
|
260 | 1,369 | | ||||||||||
Foreign
|
48,014 | 44,686 | 20,082 | ||||||||||
68,207 | 69,228 | 20,496 | |||||||||||
Deferred:
|
|||||||||||||
Federal
|
(7,044 | ) | (31,729 | ) | (55,630 | ) | |||||||
State
|
2,381 | 2,118 | 2,069 | ||||||||||
Foreign
|
21,487 | 3,758 | (342 | ) | |||||||||
16,824 | (25,853 | ) | (53,903 | ) | |||||||||
Provision for (benefit from) income taxes
|
$ | 85,031 | $ | 43,375 | $ | (33,407 | ) | ||||||
61
Fiscal Year End | |||||||||
2005 | 2004 | ||||||||
Net deferred tax assets and (liabilities):
|
|||||||||
Net operating loss carryforwards
|
$ | 50,990 | $ | 62,878 | |||||
Allowance on accounts receivable
|
14,623 | 22,660 | |||||||
Available tax credits
|
24,587 | 23,299 | |||||||
Inventories
|
(2,003 | ) | (6,838 | ) | |||||
Realized gains on available-for-sale securities not currently
taxable
|
(2,711 | ) | (9,108 | ) | |||||
Depreciation and amortization
|
(40,318 | ) | (38,189 | ) | |||||
Employee benefits and compensation
|
32,307 | 29,025 | |||||||
Restructuring charges
|
2,469 | 3,393 | |||||||
Reserves and accruals
|
57,285 | 22,767 | |||||||
Other
|
4,266 | 5,133 | |||||||
141,495 | 115,020 | ||||||||
Valuation allowance
|
(27,417 | ) | (16,477 | ) | |||||
Total
|
$ | 114,078 | $ | 98,543 | |||||
62
Fiscal Year | ||||||||||||
2005 | 2004 | 2003 | ||||||||||
U.S. statutory rate
|
$ | 105,678 | $ | 92,147 | $ | 40,528 | ||||||
Reversal of Softbank federal deferred tax liability
|
(2,385 | ) | (41,078 | ) | (70,461 | ) | ||||||
State income taxes, net of federal income tax benefit
|
1,391 | 2,266 | 1,345 | |||||||||
Effect of international operations
|
(21,965 | ) | (10,210 | ) | (4,021 | ) | ||||||
Other
|
2,312 | 250 | (798 | ) | ||||||||
Total tax provision
|
$ | 85,031 | $ | 43,375 | $ | (33,407 | ) | |||||
Note 9 | Transactions with Related Parties |
63
Note 10 | Commitments and Contingencies |
64
2006
|
$ | 87,230 | ||
2007
|
79,881 | |||
2008
|
71,087 | |||
2009
|
68,572 | |||
2010
|
45,376 | |||
Thereafter
|
81,588 | |||
$ | 433,734 | |||
Note 11 | Segment Information |
65
As of and for the Fiscal Year Ended | ||||||||||||||
2005 | 2004 | 2003 | ||||||||||||
Net sales
|
||||||||||||||
North America
|
||||||||||||||
Sales to unaffiliated customers
|
$ | 12,216,790 | $ | 11,776,679 | $ | 10,964,761 | ||||||||
Intergeographic sales
|
177,299 | 150,137 | 130,804 | |||||||||||
Europe
|
10,424,026 | 9,839,185 | 8,267,000 | |||||||||||
Asia-Pacific
|
4,843,135 | 2,741,608 | 2,319,982 | |||||||||||
Latin America
|
1,324,361 | 1,104,599 | 1,061,274 | |||||||||||
Eliminations of intergeographic sales
|
(177,299 | ) | (150,137 | ) | (130,804 | ) | ||||||||
Total
|
$ | 28,808,312 | $ | 25,462,071 | $ | 22,613,017 | ||||||||
Income (loss) from operations
|
||||||||||||||
North America
|
$ | 157,624 | $ | 130,321 | $ | 94,501 | ||||||||
Europe
|
143,377 | 129,754 | 73,248 | |||||||||||
Asia-Pacific
|
39,768 | 9,796 | (10,335 | ) | ||||||||||
Latin America
|
21,417 | 13,496 | (1,221 | ) | ||||||||||
Total
|
$ | 362,186 | $ | 283,367 | $ | 156,193 | ||||||||
Identifiable assets
|
||||||||||||||
North America
|
$ | 4,148,828 | $ | 3,812,388 | $ | 3,387,133 | ||||||||
Europe
|
1,894,641 | 2,105,086 | 1,668,710 | |||||||||||
Asia-Pacific
|
639,574 | 690,047 | 173,573 | |||||||||||
Latin America
|
351,947 | 319,216 | 244,746 | |||||||||||
Total
|
$ | 7,034,990 | $ | 6,926,737 | $ | 5,474,162 | ||||||||
Capital expenditures
|
||||||||||||||
North America
|
$ | 14,634 | $ | 19,767 | $ | 23,128 | ||||||||
Europe
|
14,073 | 13,880 | 7,317 | |||||||||||
Asia-Pacific
|
9,266 | 2,211 | 2,182 | |||||||||||
Latin America
|
869 | 1,127 | 2,376 | |||||||||||
Total
|
$ | 38,842 | $ | 36,985 | $ | 35,003 | ||||||||
Depreciation and amortization
|
||||||||||||||
North America
|
$ | 33,193 | $ | 34,631 | $ | 55,426 | ||||||||
Europe
|
14,260 | 17,580 | 17,491 | |||||||||||
Asia-Pacific
|
14,228 | 3,426 | 3,194 | |||||||||||
Latin America
|
2,657 | 2,020 | 2,408 | |||||||||||
Total
|
$ | 64,338 | $ | 57,657 | $ | 78,519 | ||||||||
66
Fiscal Year | |||||||||||||||
2005 | 2004 | 2003 | |||||||||||||
Reorganization costs
|
|||||||||||||||
North America
|
$ | 9,649 | $ | (2,234 | ) | $ | 11,234 | ||||||||
Europe
|
(82 | ) | (978 | ) | 9,202 | ||||||||||
Asia-Pacific
|
6,709 | 316 | 74 | ||||||||||||
Latin America
|
| | 1,060 | ||||||||||||
Total
|
$ | 16,276 | $ | (2,896 | ) | $ | 21,570 | ||||||||
Other profit enhancement program costs:
|
|||||||||||||||
Charged to cost of sales
|
|||||||||||||||
Europe
|
$ | | $ | | $ | 443 | |||||||||
Charged to operating expenses
|
|||||||||||||||
North America
|
$ | 16,933 | $ | | $ | 17,399 | |||||||||
Europe
|
| | 5,964 | ||||||||||||
Asia-Pacific
|
6,002 | | | ||||||||||||
Total
|
$ | 22,935 | $ | | $ | 23,363 | |||||||||
Equity Incentive Plans |
67
Weighted- | ||||||||
Shares | Average | |||||||
(000s) | Exercise Price | |||||||
Outstanding at December 28, 2002
|
29,392 | $ | 16.42 | |||||
Stock options granted during the year
|
10,445 | 11.23 | ||||||
Stock options exercised
|
(1,106 | ) | 9.28 | |||||
Forfeitures
|
(2,297 | ) | 15.71 | |||||
Outstanding at January 3, 2004
|
36,434 | 15.19 | ||||||
Stock options granted during the year
|
6,750 | 15.47 | ||||||
Stock options exercised
|
(6,695 | ) | 12.62 | |||||
Forfeitures
|
(3,830 | ) | 17.25 | |||||
Outstanding at January 1, 2005
|
32,659 | 15.40 | ||||||
Stock options granted during the year
|
4,748 | 17.28 | ||||||
Stock options exercised
|
(3,576 | ) | 13.78 | |||||
Forfeitures
|
(3,273 | ) | 17.86 | |||||
Outstanding at December 31, 2005
|
30,558 | 15.61 | ||||||
Options Outstanding | Options Exercisable | |||||||||||||||||||
Number | Weighted- | Weighted- | Number | Weighted- | ||||||||||||||||
Outstanding at | Average | Average | Exercisable at | Average | ||||||||||||||||
December 31, | Remaining | Exercise | December 31, | Exercise | ||||||||||||||||
Range of Exercise Prices | 2005 (000s) | Life | Price | 2005 (000s) | Price | |||||||||||||||
$ 9.75 $12.35
|
8,455 | 6.3 | $ | 11.29 | 6,255 | $ | 11.35 | |||||||||||||
$12.56 $15.90
|
9,213 | 7.2 | 14.13 | 5,414 | 13.62 | |||||||||||||||
$16.10 $19.93
|
11,013 | 6.8 | 17.48 | 6,882 | 17.26 | |||||||||||||||
$20.00 $27.00
|
281 | 1.7 | 25.26 | 269 | 25.48 | |||||||||||||||
$27.88 $53.56
|
1,596 | 0.7 | 32.57 | 1,596 | 32.57 | |||||||||||||||
30,558 | 6.4 | 15.61 | 20,416 | 15.79 | ||||||||||||||||
68
Employee Stock Purchase Plans |
Employee Benefit Plans |
69
Class A | |||||
December 28, 2002
|
150,778,355 | ||||
Stock options exercised
|
1,106,229 | ||||
Grant of restricted Class A Common Stock
|
40,676 | ||||
Issuance of Class A Common Stock related to Employee Stock
Purchase Plan
|
38,407 | ||||
January 3, 2004
|
151,963,667 | ||||
Stock options exercised
|
6,695,330 | ||||
Grant of restricted Class A Common Stock
|
35,019 | ||||
Issuance of Class A Common Stock related to Employee Stock
Purchase Plan
|
63,545 | ||||
Surrender of restricted Class A Common Stock associated
with payment of withholding tax
|
(19,663 | ) | |||
January 1, 2005
|
158,737,898 | ||||
Stock options exercised
|
3,576,256 | ||||
Grant of restricted Class A Common Stock
|
52,129 | ||||
December 31, 2005
|
162,366,283 | ||||
70
Balance at | Charged to | Balance | |||||||||||||||||||
Beginning | Costs and | at End of | |||||||||||||||||||
Description | of Year | Expenses | Deductions | Other(*) | Year | ||||||||||||||||
(Dollars in 000s) | |||||||||||||||||||||
Allowance for doubtful accounts receivable and sales
returns:
|
|||||||||||||||||||||
2005
|
$ | 93,465 | $ | 22,060 | $ | (32,744 | ) | $ | (950 | ) | $ | 81,831 | |||||||||
2004
|
91,613 | 28,325 | (38,017 | ) | 11,544 | 93,465 | |||||||||||||||
2003
|
89,889 | 54,096 | (56,046 | ) | 3,674 | 91,613 |
* | Other includes recoveries, acquisitions, and the effect of fluctuation in foreign currency. |
71
72
73
ITEM 9. | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE |
ITEM 9A. | CONTROLS AND PROCEDURES |
74
ITEM 9B. | OTHER INFORMATION |
ITEM 15. | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES |
See Index to Consolidated Financial Statements under Item 8. Financial Statements and Supplemental Data of this Annual Report. |
See Financial Statement Schedule II Valuation and Qualifying Accounts of this Annual Report under Item 8. Financial Statements and Supplemental Data. |
Exhibit | ||||
No. | Exhibit | |||
3 | .1 | Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.01 to the Companys Registration Statement on Form S-1 (File No. 333-08453) (the IPO S-1)) | ||
3 | .2 | Certificate of Amendment of the Certificate of Incorporation of the Company dated as of June 5, 2001 (incorporated by reference to Exhibit 3.2 to the Companys Registration Statement on Form S-4 (File No. 333-69816) (the 2001 S-4)) | ||
3 | .3 | Amended and Restated Bylaws of the Company dated April 6, 2005 (incorporated by reference to Exhibit 99.1 to the Companys Current Report on Form 8-K filed April 7, 2005 (the 4/7/05 8-K)) | ||
4 | .1 | Indenture between the Company as Issuer and Bank One Trust Corp., N.A. as Trustee, dated as of August 16, 2001, relating to 97/8% Senior Subordinated Notes due 2008 (incorporated by reference to Exhibit 4.1 to the 2001 S-4) | ||
10 | .1 | Amended and Restated Reorganization Agreement dated as of October 17, 1996 among the Company, Ingram Industries Inc., and Ingram Entertainment Inc. (incorporated by reference to Exhibit 10.13 to the Companys Registration Statement on Form S-1 (File No. 333-16667) (the Thrift Plan S-1)) | ||
10 | .2 | Thrift Plan Liquidity Agreement dated as of November 6, 1996 among the Company and the Ingram Thrift Plan (incorporated by reference to Exhibit 10.16 to the Thrift Plan S-1) | ||
10 | .3 | Tax Sharing and Tax Services Agreement dated as of November 6, 1996 among the Company, Ingram Industries, and Ingram Entertainment (incorporated by reference to Exhibit 10.17 to the Thrift Plan S-1) | ||
10 | .4 | Employee Benefits Transfer and Assumption Agreement dated as of November 6, 1996 among the Company, Ingram Industries, and Ingram Entertainment (incorporated by reference to Exhibit 10.19 to the Thrift Plan S-1) |
75
Exhibit | ||||
No. | Exhibit | |||
10 | .5 | Amended and Restated Exchange Agreement dated as of November 6, 1996 among the Company, Ingram Industries, Ingram Entertainment and the other parties thereto (incorporated by reference to Exhibit 10.21 to the Thrift Plan S-1) | ||
10 | .6 | Retirement Programs Ingram Micro Amended and Restated 401(k) Investment Plan | ||
10 | .7 | Retirement Programs Ingram Micro Supplemental Investment Savings Plan (incorporated by reference to Exhibit 10.6 to the Companys Annual Report on Form 10-K for the 2004 fiscal year (the 2004 10-K)) | ||
10 | .8 | Retirement Programs First Amendment to Supplemental Investment Savings Plan (incorporated by reference to Exhibit 10.7 to the 2004 10-K) | ||
10 | .9 | Retirement Programs 2005 Compensation Deferral Agreement for Kevin M. Murai | ||
10 | .10 | Retirement Programs 2006 Compensation Deferral Agreement for Kevin M. Murai | ||
10 | .11 | Equity-Based Compensation Programs Ingram Micro Inc. 1996 Equity Incentive Plan (incorporated by reference to Exhibit 10.09 to the IPO S-1) | ||
10 | .12 | Equity-Based Compensation Programs Ingram Micro Inc. Amended and Restated 1996 Equity Incentive Plan (incorporated by reference to Exhibit 10.10 to the IPO S-1) | ||
10 | .13 | Equity-Based Compensation Programs Amendment No. 1 to the Ingram Micro Inc. Amended and Restated 1996 Equity Incentive Plan (incorporated by reference to Exhibit 10.06 to the Companys Annual Report on Form 10-K for the 1998 fiscal year (the 1998 10-K)) | ||
10 | .14 | Equity-Based Compensation Programs Ingram Micro Inc. 1998 Equity Incentive Plan (incorporated by reference to Exhibit 10.43 to the 1998 10-K) | ||
10 | .15 | Equity-Based Compensation Programs Ingram Micro Inc. 2000 Equity Incentive Plan (incorporated by reference to Exhibit 99.01 to the Companys Registration Statement on Form S-8 (File No. 333-39780)) | ||
10 | .16 | Equity-Based Compensation Programs Ingram Micro Inc. 2003 Equity Incentive Plan ((the 2003 Plan) incorporated by reference to Exhibit 10.06 to the Companys Annual Report on Form 10-K for the 2003 fiscal year (the 2003 10-K)) | ||
10 | .17 | Employment Agreement with Kent B. Foster, dated March 6, 2000 (incorporated by reference to Exhibit 10.55 to the Companys Annual Report on Form 10-K for the 1999 fiscal year (the 1999 10-K) | ||
10 | .18 | Executive Retention Plan (incorporated by reference to Exhibit 10.01 to the Companys Quarterly Report on Form 10-Q for the quarter ended June 30, 2001 (the Q2 2001 10-Q)) | ||
10 | .19 | Executive Retention Plan Agreement with Kevin M. Murai (incorporated by reference to Exhibit 10.03 to the Q2 2001 10-Q) | ||
10 | .20 | Executive Retention Plan Agreement with Gregory M.E. Spierkel (incorporated by reference to Exhibit 10.04 to the Q2 2001 10-Q) | ||
10 | .21 | Executive Retention Plan Agreement with Henri T. Koppen (incorporated by reference to Exhibit 10.45 to the Companys Annual Report on Form 10-K for the 2002 fiscal year (the 2002 10-K) | ||
10 | .22 | Amendment to Executive Retention Plan Agreement with Henri T. Koppen (incorporated by reference to Exhibit 10.44 to the Companys Annual Report on Form 10-K for the 2003 fiscal year (the 2003 10-K) | ||
10 | .23 | Ingram Micro Inc. Executive Incentive Plan (incorporated by reference to Exhibit 10.44 to the Companys Quarterly Report on Form 10-Q for the quarter ended June 29, 2002) | ||
10 | .24 | Executive Officer Severance Policy adopted October 2003 (incorporated by reference to Exhibit 10.52 to the 2003 10-K) | ||
10 | .25 | 2003 Executive Retention Agreement with Michael J. Grainger dated December 19, 2003 (incorporated by reference to Exhibit 10.46 to the 2003 10-K) | ||
10 | .26 | Employment Agreement as of June 1, 2005 between Ingram Micro and Kent B. Foster (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K filed on May 31, 2005) | ||
10 | .27 | 2001 Executive Retention Plan Award Payment Deferral Confirmation to Henri T. Koppen (filed as Exhibit 99.01 to the Companys Current Report on Form 8-K filed on March 6, 2006) |
76
Exhibit | ||||
No. | Exhibit | |||
10 | .28 | Compensation Agreement Form of Board of Directors Compensation Election Form (Committee Chairman) (incorporated by reference to Exhibit 99.4 to the Current Report on Form 8-K filed on December 23, 2004 (the 12/23/04 8-K)) | ||
10 | .29 | Compensation Agreement Form of Board of Directors Compensation Election Form (Non-Committee Chairman) (incorporated by reference to Exhibit 99.5 to the 12/23/04 8-K) | ||
10 | .30 | Compensation Agreement Form of Board of Directors Distribution Election and Beneficial Designation Form (incorporated by reference to Exhibit 99.6 to the 12/23/04 8-K) | ||
10 | .31 | Compensation Agreement Form of Board of Directors Restricted Stock Units Deferral Election Agreement (incorporated by reference to Exhibit 99.7 to the 12/23/04 8-K) | ||
10 | .32 | Compensation Agreement Form of Board of Directors Compensation Deferral Election Form (incorporated by reference to Exhibit 99.8 to the 12/23/04 8-K) | ||
10 | .33 | Compensation Agreement Form of Non-Qualified Stock Option Award Agreement (U.S.) for awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K filed on December 16, 2005 (the 12/16/05 8-K)) | ||
10 | .34 | Compensation Agreement Form of Non-Qualified Stock Option Award Agreement (Non-U.S.) for awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.2 to the 12/16/05 8-K) | ||
10 | .35 | Compensation Agreement Form of Restricted Stock Award Agreement for time-vested awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.3 to the 12/16/05 8-K) | ||
10 | .36 | Compensation Agreement Form of Restricted Stock Unit Award Agreement for time-vested awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.4 to the 12/16/05 8-K) | ||
10 | .37 | Compensation Agreement Form of Restricted Stock Award Agreement for performance-vested awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.5 to the 12/16/05 8-K) | ||
10 | .38 | Compensation Agreement Form of Restricted Stock Unit Award Agreement for performance-vested awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.6 to the 12/16/05 8-K) | ||
10 | .39 | Summary of Annual Executive Incentive Award Program | ||
10 | .40 | US$150,000,000 Credit Agreement dated as of December 13, 2002 among the Company, as Initial Borrower and Guarantor, Ingram European Coordination Center N.V., as Initial Borrower, certain financial institutions as the Lenders, ABN AMRO Bank N.V., as the Syndication Agent for the Lenders and The Bank of Nova Scotia, as the Administrative Agent for the Lenders (the 2002 Credit Agreement) (incorporated by reference to Exhibit 10.41 to the 2002 10-K) | ||
10 | .41 | Amendment No. 1 dated as of February 20, 2003 to the 2002 Credit Agreement (incorporated by reference to Exhibit 10.42 to the 2002 10-K) | ||
10 | .42 | Amended and Restated German Master Receivables Transfer and Servicing Agreement between BNP Paribas Bank N.V. as Transferee and Ingram Micro Distribution GMBH as Originator and Ingram Micro Holding GMBH as Depositor, dated August 14, 2003 and restated as of March 31, 2004 (incorporated by reference to Exhibit 10.2 to the Companys Quarterly Report on Form 10-Q for the quarter ended April 3, 2004) | ||
10 | .43 | Receivables Funding Agreement, dated July 29, 2004, among General Electric Capital Corporation, the Company, and Funding (incorporated by reference to Exhibit 10.54 to the Companys Quarterly Report on Form 10-Q for the quarter ended July 3, 2004 (the 2004 Q2 10-Q)) | ||
10 | .44 | Receivables Sale Agreement, dated July 29, 2004 between the Company and Ingram Funding Inc. (incorporated by reference to Exhibit 10.55 to the 2004 Q2 10-Q) | ||
10 | .45 | Share Sale Agreement with the stockholders of Techpac Holdings Limited, a company incorporated in Bermuda, dated September 26, 2004 (incorporated by reference to Exhibit 10.54 to the Companys Quarterly Report on Form 10-Q for the quarter ended October 2, 2004) |
77
Exhibit | ||||
No. | Exhibit | |||
10 | .46 | Credit Agreement dated effective as of July 29, 2005 among Ingram Micro Inc. and its subsidiaries Ingram Micro Coordination Center B.V.B.A. and Ingram Micro Europe Treasury LLC, Bank of Nova Scotia, as administrative agent, ABN AMRO Bank N.V., as syndication agent, and the lenders party thereto (incorporated by reference to Exhibit 10.1 to the Companys Current Report on Form 8-K filed on August 2, 2005) | ||
14 | .1 | Ingram Micro Code of Conduct (incorporated by reference to Exhibit 14.1 to the Companys Current Report on Form 8-K filed on August 24, 2005) | ||
21 | .1 | Subsidiaries of the Registrant | ||
23 | .1 | Consent of Independent Registered Public Accounting Firm | ||
31 | .1 | Certification by Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act | ||
31 | .2 | Certification by Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act | ||
32 | .1 | Certification by Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act | ||
32 | .2 | Certification by Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act | ||
99 | .1 | Amended and Restated Corporate Governance Guidelines of Ingram Micro Inc., dated April 6, 2005 (incorporated by reference to Exhibit 99.2 to the 4/7/05 8-K) |
78
INGRAM MICRO INC. |
By: | /s/ Larry C. Boyd |
|
|
Larry C. Boyd | |
Senior Vice President, Secretary | |
and General Counsel |
Signature | Title | Date | ||||
/s/ Gregory M. E. Spierkel Gregory M. E. Spierkel |
Chief Executive Officer and Director (Principal Executive Officer) | March 14, 2006 | ||||
/s/ Kevin M. Murai Kevin M. Murai |
President and Chief Operating Officer and Director | March 14, 2006 | ||||
/s/ William D. Humes William D. Humes |
Executive Vice President and Chief Financial Officer (Principal Financial Officer and Accounting Officer) | March 14, 2006 | ||||
/s/ Kent B. Foster Kent B. Foster |
Chairman of the Board | March 14, 2006 | ||||
/s/ Howard I. Atkins Howard I. Atkins |
Director | March 14, 2006 | ||||
/s/ John R. Ingram John R. Ingram |
Director | March 14, 2006 | ||||
/s/ Martha R. Ingram Martha R. Ingram |
Director | March 14, 2006 | ||||
/s/ Orrin H. Ingram Orrin H. Ingram II |
Director | March 14, 2006 | ||||
/s/ Dale R. Laurance Dale R. Laurance |
Director | March 14, 2006 |
79
Signature | Title | Date | ||||
/s/ Linda Fayne Levinson Linda Fayne Levinson |
Director | March 14, 2006 | ||||
/s/ Gerhard Schulmeyer Gerhard Schulmeyer |
Director | March 14, 2006 | ||||
/s/ Michael T. Smith Michael T. Smith |
Director | March 14, 2006 | ||||
/s/ Joe B. Wyatt Joe B. Wyatt |
Director | March 14, 2006 |
80
Exhibit | ||||
No. | Exhibit | |||
3 | .1 | Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.01 to the Companys Registration Statement on Form S-1 (File No. 333-08453) (the IPO S-1)) | ||
3 | .2 | Certificate of Amendment of the Certificate of Incorporation of the Company dated as of June 5, 2001 (incorporated by reference to Exhibit 3.2 to the Companys Registration Statement on Form S-4 (File No. 333-69816) (the 2001 S-4)) | ||
3 | .3 | Amended and Restated Bylaws of the Company dated April 6, 2005 (incorporated by reference to Exhibit 99.1 to the Companys Current Report on Form 8-K filed April 7, 2005 (the 4/7/05 8-K)) | ||
4 | .1 | Indenture between the Company as Issuer and Bank One Trust Corp., N.A. as Trustee, dated as of August 16, 2001, relating to 97/8% Senior Subordinated Notes due 2008 (incorporated by reference to Exhibit 4.1 to the 2001 S-4) | ||
10 | .1 | Amended and Restated Reorganization Agreement dated as of October 17, 1996 among the Company, Ingram Industries Inc., and Ingram Entertainment Inc. (incorporated by reference to Exhibit 10.13 to the Companys Registration Statement on Form S-1 (File No. 333-16667) (the Thrift Plan S-1)) | ||
10 | .2 | Thrift Plan Liquidity Agreement dated as of November 6, 1996 among the Company and the Ingram Thrift Plan (incorporated by reference to Exhibit 10.16 to the Thrift Plan S-1) | ||
10 | .3 | Tax Sharing and Tax Services Agreement dated as of November 6, 1996 among the Company, Ingram Industries, and Ingram Entertainment (incorporated by reference to Exhibit 10.17 to the Thrift Plan S-1) | ||
10 | .4 | Employee Benefits Transfer and Assumption Agreement dated as of November 6, 1996 among the Company, Ingram Industries, and Ingram Entertainment (incorporated by reference to Exhibit 10.19 to the Thrift Plan S-1) | ||
10 | .5 | Amended and Restated Exchange Agreement dated as of November 6, 1996 among the Company, Ingram Industries, Ingram Entertainment and the other parties thereto (incorporated by reference to Exhibit 10.21 to the Thrift Plan S-1) | ||
10 | .6 | Retirement Programs Ingram Micro Amended and Restated 401(k) Investment Plan | ||
10 | .7 | Retirement Programs Ingram Micro Supplemental Investment Savings Plan (incorporated by reference to Exhibit 10.6 to the Companys Annual Report on Form 10-K for the 2004 fiscal year (the 2004 10-K)) | ||
10 | .8 | Retirement Programs First Amendment to Supplemental Investment Savings Plan (incorporated by reference to Exhibit 10.7 to the 2004 10-K) | ||
10 | .9 | Retirement Programs 2005 Compensation Deferral Agreement for Kevin M. Murai | ||
10 | .10 | Retirement Programs 2006 Compensation Deferral Agreement for Kevin M. Murai | ||
10 | .11 | Equity-Based Compensation Programs Ingram Micro Inc. 1996 Equity Incentive Plan (incorporated by reference to Exhibit 10.09 to the IPO S-1) | ||
10 | .12 | Equity-Based Compensation Programs Ingram Micro Inc. Amended and Restated 1996 Equity Incentive Plan (incorporated by reference to Exhibit 10.10 to the IPO S-1) | ||
10 | .13 | Equity-Based Compensation Programs Amendment No. 1 to the Ingram Micro Inc. Amended and Restated 1996 Equity Incentive Plan (incorporated by reference to Exhibit 10.06 to the Companys Annual Report on Form 10-K for the 1998 fiscal year (the 1998 10-K)) | ||
10 | .14 | Equity-Based Compensation Programs Ingram Micro Inc. 1998 Equity Incentive Plan (incorporated by reference to Exhibit 10.43 to the 1998 10-K) | ||
10 | .15 | Equity-Based Compensation Programs Ingram Micro Inc. 2000 Equity Incentive Plan (incorporated by reference to Exhibit 99.01 to the Companys Registration Statement on Form S-8 (File No. 333-39780)) | ||
10 | .16 | Equity-Based Compensation Programs Ingram Micro Inc. 2003 Equity Incentive Plan ((the 2003 Plan) incorporated by reference to Exhibit 10.06 to the Companys Annual Report on Form 10-K for the 2003 fiscal year (the 2003 10-K)) | ||
10 | .17 | Employment Agreement with Kent B. Foster, dated March 6, 2000 (incorporated by reference to Exhibit 10.55 to the Companys Annual Report on Form 10-K for the 1999 fiscal year (the 1999 10-K) |
Exhibit | ||||
No. | Exhibit | |||
10 | .18 | Executive Retention Plan (incorporated by reference to Exhibit 10.01 to the Companys Quarterly Report on Form 10-Q for the quarter ended June 30, 2001 (the Q2 2001 10-Q)) | ||
10 | .19 | Executive Retention Plan Agreement with Kevin M. Murai (incorporated by reference to Exhibit 10.03 to the Q2 2001 10-Q) | ||
10 | .20 | Executive Retention Plan Agreement with Gregory M.E. Spierkel (incorporated by reference to Exhibit 10.04 to the Q2 2001 10-Q) | ||
10 | .21 | Executive Retention Plan Agreement with Henri T. Koppen (incorporated by reference to Exhibit 10.45 to the Companys Annual Report on Form 10-K for the 2002 fiscal year (the 2002 10-K) | ||
10 | .22 | Amendment to Executive Retention Plan Agreement with Henri T. Koppen (incorporated by reference to Exhibit 10.44 to the Companys Annual Report on Form 10-K for the 2003 fiscal year (the 2003 10-K) | ||
10 | .23 | Ingram Micro Inc. Executive Incentive Plan (incorporated by reference to Exhibit 10.44 to the Companys Quarterly Report on Form 10-Q for the quarter ended June 29, 2002) | ||
10 | .24 | Executive Officer Severance Policy adopted October 2003 (incorporated by reference to Exhibit 10.52 to the 2003 10-K) | ||
10 | .25 | 2003 Executive Retention Agreement with Michael J. Grainger dated December 19, 2003 (incorporated by reference to Exhibit 10.46 to the 2003 10-K) | ||
10 | .26 | Employment Agreement as of June 1, 2005 between Ingram Micro and Kent B. Foster (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K filed on May 31, 2005) | ||
10 | .27 | 2001 Executive Retention Plan Award Payment Deferral Confirmation to Henri T. Koppen (filed as Exhibit 99.01 to the Companys Current Report on Form 8-K filed on March 6, 2006) | ||
10 | .28 | Compensation Agreement Form of Board of Directors Compensation Election Form (Committee Chairman) (incorporated by reference to Exhibit 99.4 to the Current Report on Form 8-K filed on December 23, 2004 (the 12/23/04 8-K)) | ||
10 | .29 | Compensation Agreement Form of Board of Directors Compensation Election Form (Non-Committee Chairman) (incorporated by reference to Exhibit 99.5 to the 12/23/04 8-K) | ||
10 | .30 | Compensation Agreement Form of Board of Directors Distribution Election and Beneficial Designation Form (incorporated by reference to Exhibit 99.6 to the 12/23/04 8-K) | ||
10 | .31 | Compensation Agreement Form of Board of Directors Restricted Stock Units Deferral Election Agreement (incorporated by reference to Exhibit 99.7 to the 12/23/04 8-K) | ||
10 | .32 | Compensation Agreement Form of Board of Directors Compensation Deferral Election Form (incorporated by reference to Exhibit 99.8 to the 12/23/04 8-K) | ||
10 | .33 | Compensation Agreement Form of Non-Qualified Stock Option Award Agreement (U.S.) for awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.1 to the Current Report on Form 8-K filed on December 16, 2005 (the 12/16/05 8-K)) | ||
10 | .34 | Compensation Agreement Form of Non-Qualified Stock Option Award Agreement (Non-U.S.) for awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.2 to the 12/16/05 8-K) | ||
10 | .35 | Compensation Agreement Form of Restricted Stock Award Agreement for time-vested awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.3 to the 12/16/05 8-K) | ||
10 | .36 | Compensation Agreement Form of Restricted Stock Unit Award Agreement for time-vested awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.4 to the 12/16/05 8-K) | ||
10 | .37 | Compensation Agreement Form of Restricted Stock Award Agreement for performance-vested awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.5 to the 12/16/05 8-K) | ||
10 | .38 | Compensation Agreement Form of Restricted Stock Unit Award Agreement for performance-vested awards granted under the 2003 Plan (incorporated by reference to Exhibit 99.6 to the 12/16/05 8-K) | ||
10 | .39 | Summary of Annual Executive Incentive Award Program | ||
10 | .40 | US$150,000,000 Credit Agreement dated as of December 13, 2002 among the Company, as Initial Borrower and Guarantor, Ingram European Coordination Center N.V., as Initial Borrower, certain financial institutions as the Lenders, ABN AMRO Bank N.V., as the Syndication Agent for the Lenders and The Bank of Nova Scotia, as the Administrative Agent for the Lenders (the 2002 Credit Agreement) (incorporated by reference to Exhibit 10.41 to the 2002 10-K) |
Exhibit | ||||
No. | Exhibit | |||
10 | .41 | Amendment No. 1 dated as of February 20, 2003 to the 2002 Credit Agreement (incorporated by reference to Exhibit 10.42 to the 2002 10-K) | ||
10 | .42 | Amended and Restated German Master Receivables Transfer and Servicing Agreement between BNP Paribas Bank N.V. as Transferee and Ingram Micro Distribution GMBH as Originator and Ingram Micro Holding GMBH as Depositor, dated August 14, 2003 and restated as of March 31, 2004 (incorporated by reference to Exhibit 10.2 to the Companys Quarterly Report on Form 10-Q for the quarter ended April 3, 2004) | ||
10 | .43 | Receivables Funding Agreement, dated July 29, 2004, among General Electric Capital Corporation, the Company, and Funding (incorporated by reference to Exhibit 10.54 to the Companys Quarterly Report on Form 10-Q for the quarter ended July 3, 2004 (the 2004 Q2 10-Q)) | ||
10 | .44 | Receivables Sale Agreement, dated July 29, 2004 between the Company and Ingram Funding Inc. (incorporated by reference to Exhibit 10.55 to the 2004 Q2 10-Q) | ||
10 | .45 | Share Sale Agreement with the stockholders of Techpac Holdings Limited, a company incorporated in Bermuda, dated September 26, 2004 (incorporated by reference to Exhibit 10.54 to the Companys Quarterly Report on Form 10-Q for the quarter ended October 2, 2004) | ||
10 | .46 | Credit Agreement dated effective as of July 29, 2005 among Ingram Micro Inc. and its subsidiaries Ingram Micro Coordination Center B.V.B.A. and Ingram Micro Europe Treasury LLC, Bank of Nova Scotia, as administrative agent, ABN AMRO Bank N.V., as syndication agent, and the lenders party thereto (incorporated by reference to Exhibit 10.1 to the Companys Current Report on Form 8-K filed on August 2, 2005) | ||
14 | .1 | Ingram Micro Code of Conduct (incorporated by reference to Exhibit 14.1 to the Companys Current Report on Form 8-K filed on August 24, 2005) | ||
21 | .1 | Subsidiaries of the Registrant | ||
23 | .1 | Consent of Independent Registered Public Accounting Firm | ||
31 | .1 | Certification by Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act | ||
31 | .2 | Certification by Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act | ||
32 | .1 | Certification by Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act | ||
32 | .2 | Certification by Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act | ||
99 | .1 | Amended and Restated Corporate Governance Guidelines of Ingram Micro Inc., dated April 6, 2005 (incorporated by reference to Exhibit 99.2 to the 4/7/05 8-K) |
EXHIBIT 10.6 INGRAM MICRO 401(k) INVESTMENT SAVINGS PLAN - -------------------------------------------------------------------------------- (Amended and Restated Effective April 1, 2005)
TABLE OF CONTENTS INTRODUCTION ARTICLE I DEFINITIONS 1.1 "Account" I-1 1.2 "Actual Deferral Percentage" I-1 1.3 "Adjustment Factor" I-2 1.4 "Administrator" I-2 1.5 "After-Tax Contribution Account" I-2 1.6 "After-Tax Contributions" I-2 1.7 "Annual Addition" I-2 1.8 "Average Actual Deferral Percentage" I-3 1.9 "Average Contribution Percentage" I-3 1.10 "Before-Tax Contribution Account" I-3 1.11 "Before-Tax Contributions" I-3 1.12 "Beneficiary" I-3 1.13 "Board of Directors" I-3 1.14 "Catch-Up Contribution Account" I-3 1.15 "Catch-Up Contributions" I-4 1.16 "Code" I-4 1.17 "Company" I-4 1.18 "Compensation" I-4 1.19 "Contribution Percentage" I-5 1.20 "Disability" I-6 1.21 "Effective Date" I-6 1.22 "Eligible Employee" I-6 1.23 "Employee" I-7 1.24 "Employer" I-8 1.25 "Entry Date" I-8 1.26 "ERISA" I-9 1.27 "Excess Aggregate Contributions" I-9 1.28 "Excess Contributions" I-9 1.29 "Excess Deferrals" I-9 1.30 "Fund" or "Investment Fund" I-9 1.31 "Highly Compensated Employee" I-9 1.32 "Hour of Service" I-10 1.33 "Limitation Year" I-12 1.34 "Matching Contribution Account" I-12 1.35 "Matching Contributions" I-12 1.36 "Non-highly Compensated Employee" I-12 1.37 "Normal Retirement Age" I-12 1.38 "Participant" I-12 1.39 "Period of Service" I-12 Ingram Micro Inc. Introduction 401(k) Investment Savings Plan I-i
1.40 "Period of Severance" I-13 1.41 "Plan" I-13 1.42 "Plan Year" I-14 1.43 "QMAC" I-14 1.44 "QMAC Account" I-14 1.45 "QNEC" I-14 1.46 "QNEC Account" I-14 1.47 "Regulations" I-14 1.48 "Rollover Account" I-14 1.49 "Rollover Contribution" I-14 1.50 "Severance Date" I-15 1.51 "Severance from Employment" I-15 1.52 "Spouse" I-15 1.53 "Trust Agreement" I-15 1.54 "Trust Fund" I-16 1.55 "Trustee" I-16 1.56 "Valuation Date" I-16 1.57 "Year of Service" I-16 ARTICLE II ELIGIBILITY AND PARTICIPATION 2.1 Eligibility II-1 2.2 Beneficiary Designation II-1 2.3 Eligibility Upon Reemployment II-2 2.4 Transferred Employees II-2 2.5 Termination of Participation II-3 ARTICLE III CONTRIBUTIONS AND ALLOCATIONS 3.1 Employee Contributions III-1 3.2 Employer Contributions III-4 3.3 Catch-Up Contributions III-5 3.4 Rollover Contributions III-6 3.5 Actual Deferral Percentage Test III-7 3.6 Reductions During Plan Year III-10 3.7 Return or Recharacterization of Excess Contributions After End of Plan Year III-9 3.8 Actual Contribution Percentage Test III-12 3.9 Return of Excess Aggregate Contributions III-14 3.10 Distribution of Excess Deferrals III-16 3.11 Maximum Annual Additions III-17 3.12 Return of Contributions to Employer III-20 3.13 Rights of Reemployed Veterans III-20 3.14 Early Participation Testing Rule III-23 Ingram Micro Inc. Introduction 401(k) Investment Savings Plan I-ii
ARTICLE IV MAINTENANCE AND VALUATION OF ACCOUNTS 4.1 Maintenance of Accounts IV-1 4.2 Valuation of Accounts IV-1 4.3 Account Statements IV-1 ARTICLE V INVESTMENT OF CONTRIBUTIONS 5.1 Investment Funds V-1 5.2 Investment of Participant's Accounts V-2 5.3 Responsibility for Investments V-2 5.4 Changing Investment Elections - Future Contributions V-3 5.5 Transfer Among Funds V-3 ARTICLE VI VESTING 6.1 Vesting in After-Tax Contribution, Before-Tax Contribution, Catch-Up Contribution, QMAC, QNEC and Rollover Accounts VI-1 6.2 Vesting in Matching Contribution Account VI-1 6.3 Forfeiture of Non-vested Interest VI-2 6.4 Restoration of Forfeitures and Service VI-2 ARTICLE VII WITHDRAWALS AND LOANS DURING EMPLOYMENT 7.1 General Rules Applicable to All In-Service Withdrawals VII-1 7.2 Rollover Contribution Account Withdrawals VII-1 7.3 Age 59 1/2 Withdrawals VII-1 7.4 Hardship Withdrawals VII-2 7.5 Loans to Participants VII-3 ARTICLE VIII DISTRIBUTIONS UPON SEVERANCE FROM EMPLOYMENT 8.1 Eligibility for Distribution VIII-1 8.2 Forms of Payment VIII-1 8.3 Timing of Payment VIII-1 8.4 Minimum Distribution Requirements VIII-2 8.5 Special Timing Rules VIII-6 8.6 Proof of Death VIII-6 8.7 Direct Rollovers VIII-6 Ingram Micro Inc. Introduction 401(k) Investment Savings Plan I-iii
ARTICLE IX TOP HEAVY PROVISIONS 9.1 When Applicable IX-1 9.2 Top Heavy Determination IX-1 9.3 Minimum Contribution IX-3 9.4 Vesting Rules IX-4 9.5 Dual Plan Special Limitations IX-4 9.6 Aggregation Groups IX-4 9.7 Key Employee Defined IX-5 9.8 Determination Date IX-5 ARTICLE X ADMINISTRATION OF PLAN 10.1 Records and Notices X-1 10.2 Powers and Duties X-1 10.3 Compensation and Expenses X-3 10.4 Bonding of Fiduciaries X-3 10.5 Standard of Conduct X-4 10.6 Claims Procedure X-5 ARTICLE XI MANAGEMENT OF FUNDS 11.1 Appointment of Trustees XI-1 11.2 Investment of Trust Fund by Trustees XI-1 11.3 Investment of Trust Fund by Investment Manager XI-2 11.4 Exclusive Benefit Rule XI-3 ARTICLE XII AMENDMENT, MERGER, TERMINATION OF PLAN 12.1 Amendment of Plan XII-1 12.2 Merger or Consolidation XII-2 12.3 Additional Participating Employers XII-2 12.4 Termination of Plan XII-3 ARTICLE XIII MISCELLANEOUS PROVISIONS 13.1 Limitation of Liability XIII-1 13.2 Indemnification XIII-1 13.3 Compliance with ERISA XIII-2 13.4 Nonalienation of Benefits XIII-2 13.5 Employment Not Guaranteed By Plan XIII-3 13.6 Protected Benefits XIII-3 13.7 Form of Communication XIII-4 13.8 Facility of Payment XIII-4 13.9 Reduction for Overpayment XIII-5 13.10 Unclaimed Benefits XIII-5 13.11 Receipt and Release XIII-6 13.12 Reliance on Information Provided to the Plan XIII-6 13.13 Service in More Than One Fiduciary Capacity XIII-6 13.14 Binding Effect of Company's Actions XIII-7 13.15 Military Service XIII-7 Ingram Micro Inc. Introduction 401(k) Investment Savings Plan I-iv
13.16 Limitation on Rights XIII-7 13.17 Governing Law XIII-7 Ingram Micro Inc. Introduction 401(k) Investment Savings Plan I-v
INGRAM MICRO 401(k) INVESTMENT SAVINGS PLAN INTRODUCTION Ingram Micro Inc. has adopted this amendment and restatement of the Ingram Micro 401(k) Investment Savings Plan (the "Plan") effective as of April 1, 2005. The Plan was last amended and restated in its entirety effective as of January 1, 1999 (the "1999 Restatement"). Among other changes, the 1999 Restatement changed the name of the Plan from the Ingram Micro Thrift Plan to the Ingram Micro 401(k) Investment Savings Plan. The 1999 Restatement was subsequently amended by the First, Second, Third and Fourth Amendments. The Second Amendment to the 1999 Restatement reflects certain provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 ("EGTRRA"). Such Amendment is intended as good faith compliance with the requirements of EGTRRA and is to be construed in accordance with EGTRRA and guidance issued thereunder. Except as otherwise provided, such Amendment is effective as of the first day of the first Plan Year beginning after December 31, 2001. The Plan includes the provisions of such Second Amendment and is intended to continue such good faith compliance with the requirements of EGTRRA. The Plan is to be construed in accordance with EGTRRA and guidance issued thereunder. Except as otherwise provided, Plan provisions related to EGTRRA shall be effective as of the first day of the first Plan Year beginning after December 31, 2001. The Plan was adopted effective as of November 6, 1996 as the Ingram Micro Thrift Plan and amended several times thereafter prior to the 1999 Restatement. The Plan is intended to provide eligible participants with a convenient way to save on a regular and long-term basis, all as set forth herein and in the trust agreement adopted as a part of the Plan. The benefits provided to any individual under the Plan will depend upon the investment results achieved under such agreement and, accordingly, may vary with respect to each individual. The Plan is a profit- Ingram Micro Inc. Introduction 401(k) Investment Savings Plan
sharing plan which includes a cash or deferred arrangement and provides for employer matching contributions. It is intended that the Plan and trust shall at all times be qualified and tax-exempt within the meaning of Sections 401(a), 401(k), 401(m) and 501(a) of the Internal Revenue Code of 1986, as now in effect or hereafter amended, and any other applicable provisions of law. Ingram Micro Inc. Introduction 401(k) Investment Savings Plan
ARTICLE I DEFINITIONS When used herein the following terms shall have the following meanings: 1.1 "Account" means the account or accounts established and maintained in respect of a Participant pursuant to Section 4.1. 1.2 "Actual Deferral Percentage" means, for a specified group of Participants (either Highly Compensated Employees or Non-highly Compensated Employees) for a Plan Year, the average of the ratios (calculated separately for each Participant in the group) of (1) the amount of Employer contributions actually paid over to the Trust on behalf of such Participant for the Plan Year to (2) the Participant's Compensation for the Plan Year. Compensation, for purposes of this Section 1.2, shall mean compensation within the meaning of Section 414(s) of the Code for the Plan Year. Employer contributions on behalf of any Participant shall include: (1) any Before-Tax Contributions (but not Catch-up Contributions) made pursuant to the Participant's deferral election (including Excess Deferrals of Highly Compensated Employees), but excluding (a) Excess Deferrals of Non-highly Compensated Employees that arise solely from Before-Tax Contributions made under the Plan or plans of the Employer and (b) Before-Tax Contributions that are taken into account in the Contribution Percentage test (provided the Actual Deferral Percentage test is satisfied both with and without these Before-Tax Contributions), and (2) any QNECs or QMACs that are taken into account in the Actual Deferral Percentage Test in accordance with Section 3.5. For purposes of calculating Actual Deferral Percentages, an Employee who would be a Participant but for the failure to make Before-Tax Contributions shall be treated as a Participant on whose behalf no Before-Tax Contributions are made. Ingram Micro Inc. Article I-1 401(k) Investment Savings Plan
1.3 "Adjustment Factor" means the cost of living adjustment factor prescribed by the Secretary of the Treasury under Section 415(d) of the Code, as applied to such items and in such manner as the Secretary shall provide. 1.4 "Administrator" (as defined in ERISA Section 3(16)(A)) means the Company which also shall be a named fiduciary (as defined in ERISA Section 402(a)(2)). 1.5 "After-Tax Contribution Account" means the Account to which are credited a Participant's After-Tax Contributions and earnings and losses on those contributions. 1.6 "After-Tax Contributions" means amounts contributed by a Participant pursuant to Section 3.1(b) that were included or includible in the Participant's gross income at the time contributed. 1.7 "Annual Addition" means, for any Limitation Year, the sum of any Employer contributions, Employee contributions, forfeitures and amounts allocated to an individual medical account, as defined in Section 415(I)(2) of the Code, which is part of a pension or annuity plan maintained by the Employer. Also, amounts derived from contributions paid or accrued which are attributable to post-retirement medical benefits, allocated to a separate account of a Key Employee, as defined in Section 419A(d)(3) of the Code, under a welfare benefit fund, as defined in Section 419(e) of the Code, maintained by the Employer are treated as Annual Additions. Employee contributions, for this purpose, shall be determined without regard to any rollover contributions (as defined in Sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3), and 457(e)(16) of the Code) and without regard to Employer contributions to a simplified employee pension which are not excludable from gross income under Section 408(k)(6) of the Code. Section 415(c)(1)(B) shall not apply to any contribution Ingram Micro Inc. Article I-2 401(k) Investment Savings Plan
for medical benefits (within the meaning of Section 419(f)(2) of the Code) after separation from service which is treated as an Annual Addition. 1.8 "Average Actual Deferral Percentage" means the average (expressed as a percentage) of the Actual Deferral Percentages of the Eligible Employees in a group. 1.9 "Average Contribution Percentage" means the average (expressed as a percentage) of the Contribution Percentages of the Eligible Employees in a group. 1.10 "Before-Tax Contribution Account" means the Account to which are credited Before-Tax Contributions made on behalf of a Participant pursuant to Section 3.1 and earnings or losses on those contributions. 1.11 "Before-Tax Contributions" means the contributions made to the Plan by the Employer on behalf of a Participant who has elected to reduce his Compensation by a like amount pursuant to Section 3.1(a). 1.12 "Beneficiary" means the beneficiary or beneficiaries designated pursuant to Section 2.2 to receive the amount, if any, payable under the Plan upon the death of a Participant. 1.13 "Board of Directors" means the Board of Directors of the Company. 1.14 "Catch-Up Contribution Account" means the account to which are credited Catch-Up Contributions made on behalf of a Participant pursuant to Section 3.3 and earnings and losses on those contributions. Ingram Micro Inc. Article I-3 401(k) Investment Savings Plan
1.15 "Catch-Up Contributions" means the contributions made to the Plan by the Employer on behalf of a Participant in accordance with Section 3.3. 1.16 "Code" means the Internal Revenue Code of 1986, as now in effect or hereafter amended. 1.17 "Company" means Ingram Micro Inc. or any successor by merger, consolidation or otherwise. 1.18 "Compensation" means, with respect to each Participant for purposes of calculating and allocating contributions to the Plan, the total amount of Box 1 Form W-2 wages as base salary including commissions, shift differentials, over-time pay, annual bonuses, amounts paid under the Long-Term Executive Cash Incentive Award Program and special and incentive bonuses, but excluding benefits under the Plan, benefits under any other pension, profit sharing, stock bonus, phantom stock, nonstatutory stock option, hospitalization, life insurance, long-term disability, or other employee benefit plan (including without limiting the foregoing, the Ingram Micro Inc. Supplemental Investment Savings Plan), travel, entertainment, and other business expense allowances from which an accounting is made to the Company, living allowances, imputed income attributable to employer-provided group term life insurance and such other imputed non-cash income recognized as such by the Code and the Company for purposes of the Plan, any home sale costs, reimbursed moving costs, employer-reimbursed or employer-subsidized meals, employer payments for the use of his or her personal car for business purposes, location adjustments or any other similar supplemental type of pay, voluntary or involuntary cashouts under the Paid Time Off (PTO) Program, and severance pay (even if such severance pay takes the form of continued payroll compensation after the Participant actually no longer is performing services Ingram Micro Inc. Article I-4 401(k) Investment Savings Plan
for the Company). Compensation shall include elective deferrals and any amount which is contributed by the Company pursuant to a salary reduction agreement, which is not includible in the gross income of the Employee under Code Section 125, 402(e)(3), 402(h), 403(b) or 132(f). The annual Compensation of each Participant taken into account for all Plan purposes shall not exceed $210,000, as adjusted by the Secretary of the Treasury for increases in the cost of living in accordance with Section 401(a)(17)(B) of the Code. The cost-of-living adjustment in effect for a calendar year applies to any period, not exceeding twelve (12) months, over which Compensation is determined (the "determination period") beginning in such calendar year. If a determination period consists of fewer than twelve (12) months, the limit referred to above will be multiplied by a fraction, the numerator of which is the number of months in the determination period and the denominator of which is 12. For other specific purposes described in the Plan, such as in Sections 1.2, 1.19, 1.23, 1.31, 3.11, 3.13, 9.3 and 9.7, "Compensation" shall have the meanings set forth in the respective sections in which the term is referenced. 1.19 "Contribution Percentage" means the ratio (expressed as a percentage) of the Participant's After-Tax Contributions, Matching Contributions, QNECs and QMACs (to the extent not taken into account for purposes of the Actual Deferral Percentage test) made under the Plan on behalf of the Participant for the Plan Year to the Participant's Compensation for the Plan Year. Compensation, for purposes of this Section 1.19, shall mean compensation within the meaning of Section 414(s) of the Code for the Plan Year. For this purpose, Matching Contributions that are forfeited either to correct Excess Aggregate Contributions or because the contributions to which they relate are Excess Deferrals, Excess Contributions or Excess Aggregate Contributions Ingram Micro Inc. Article I-5 401(k) Investment Savings Plan
shall not be included. The Employer may also elect to include Before-Tax Contributions, provided the Actual Deferral Percentage test is met before the Before-Tax Contributions are used in the Average Contribution Percentage and continues to be met following the exclusion of those Before-Tax Contributions that are used to meet the Average Contribution Percentage Test. 1.20 "Disability" means a physical or mental condition which entitles a Participant to benefits under the Employer's long-term disability plan. The Administrator will apply the provisions of this Section 1.20 in a nondiscriminatory, consistent and uniform manner. 1.21 "Effective Date" means April 1, 2005, the date as of which this amendment and restatement of the Plan is effective except as otherwise specifically provided herein. The original Effective Date of the Plan was November 6, 1996. 1.22 "Eligible Employee" means any Employee maintained on the United States payroll of the Employer other than: (a) a leased employee within the meaning of Section 1.23, (b) any person who is included in a unit of employees covered by an agreement recognized for purposes of collective bargaining with the Employer, provided retirement benefits have been the subject of good faith bargaining and such bargaining does not provide for coverage under the Plan, (c) an Employee who is a nonresident alien deriving no earned income from the Employer which constitutes income from sources within the United States; and (d) an Employee who is employed on a temporary or nonpermanent basis, that is, hired for the duration of a particular project or projects, unless such Employee becomes eligible to participate in this Plan in accordance with Section 2.1(c). Notwithstanding any other provision of the Plan, the term 'Eligible Employee' shall not include any Ingram Micro Inc. Article I-6 401(k) Investment Savings Plan
employee, independent contractor, leased employee or other individual unless such individual is contemporaneously treated by the Employer as an Employee for purposes of the Plan (without regard to any subsequent recharacterization or inconsistent determination made by any person or entity or by any court, agency or other authority with respect to such individual whenever effective). 1.23 "Employee" means any person employed by the Employer, other than an independent contractor or self-employed individual within the meaning of Section 401(c)(1) or an owner-employee within the meaning of Section 401(c)(3). Employee shall also include any leased employee. The term 'leased employee' means any person (other than an employee of the recipient) who, pursuant to an agreement between the recipient and any other person (the 'leasing organization'), has performed services for the recipient (or for the recipient and related persons determined in accordance with Section 414(n)(6) of the Code) on a substantially full-time basis for a period of at least one (1) year, and such services are performed under primary direction or control by the recipient. Contributions or benefits provided to a leased employee by the leasing organization which are attributable to services performed for the recipient employer shall be treated as provided by the recipient employer. A leased employee shall not be considered an Employee if: leased employees do not constitute more than twenty percent (20%) of the recipient's non-highly compensated workforce and the leased employee is covered by a money purchase pension plan providing (a) a nonintegrated employer contribution rate of at least ten percent (10%) of Compensation within the meaning of Section 415(c)(3) of the Code as defined in Section 3.11; (b) immediate participation; and (c) full and immediate vesting. Ingram Micro Inc. Article I-7 401(k) Investment Savings Plan
1.24 "Employer" means the Company and any subsidiary or affiliated organization of the Company that, with the approval of the Board of Directors and subject to such considerations as the Board of Directors may impose, adopts the Plan. In determining Compensation for the purposes of determining who is a leased employee under Section 1.23, in determining who is a Highly Compensated Employee under Section 1.31, in determining a Participant's Hours of Service, in determining whether an election to change the Limitation Year has been made in accordance with Section 1.33, in determining a Participant's Period of Service under Section 1.39, in determining a Participant's Severance Date under Section 1.50, in determining a Participant's Severance from Employment under Section 1.51, in determining the limitation on Before-Tax Contributions under Section 3.1(b), in determining the Average Actual Deferral Percentages under Section 3.5 and the Average Contribution Percentages under Section 3.8, in determining the limitations on Annual Additions under Section 3.11, in determining the maximum loan in Section 7.5(f) and in determining whether the Plan is Top-Heavy under Article IX, the term "Employer" shall include any other corporation or other business entity that must be aggregated with the Employer under Section 414(b), (c), (m) or (o) of the Code, but only for such periods of time when the Employer and such other corporation or other business entity must be aggregated as aforesaid. For purposes of Section 3.11, such definition of "Employer" shall be modified by Section 415(h) of the Code. 1.25 "Entry Date" means each business day of the year. Notwithstanding the above, in the case of an Employee described in Section 1.22(d), Entry Date means the date the Employee becomes eligible to participate in this Plan in accordance with Section 2.1(c). Ingram Micro Inc. Article I-8 401(k) Investment Savings Plan
1.26 "ERISA" means the Employee Retirement Income Security Act of 1974, as now in effect or as hereafter amended. 1.27 "Excess Aggregate Contributions" means After-Tax Contributions and Matching Contributions in excess of the Contribution Percentage limit, as described in Section 401(m)(6)(B) of the Code. 1.28 "Excess Contributions" means Before-Tax Contributions in excess of the Actual Deferral Percentage limit, as described in Section 401(k)(8)(B) of the Code. 1.29 "Excess Deferrals" means Before-Tax Contributions in excess of the limits imposed by Section 402(g) of the Code. 1.30 "Fund" or "Investment Fund" means the investment funds established under Article V, or any of them. 1.31 "Highly Compensated Employee" means any Employee who performs services for the Employer during the determination year and who (a) was a five percent (5%) owner, as defined in Section 9.7(a), during the determination year or look-back year, or (b), during the look-back year received Compensation from the Employer in excess of $90,000, multiplied by the Adjustment Factor, and, if the Employer so elects by Plan amendment, was in the 'top paid group' for the look-back year. For purposes of this definition, the determination year is the Plan Year; the look-back year is the twelve (12) month period preceding the Plan Year. An Employee is in the 'top paid group' if the Employee is one of the top twenty percent (20%) of Employees ranked by compensation. In determining the top Ingram Micro Inc. Article I-9 401(k) Investment Savings Plan
paid group, any reasonable method of rounding or tie breaking is permitted. For purposes of determining the number of Employees in the top paid group for any year, Employees described in Section 414(q)(5) of the Code or applicable Regulations may be excluded. A highly compensated former Employee shall be treated as a Highly Compensated Employee if he separated from service (or is deemed to have separated) prior to the determination year, performs no service for the Employer during the determination year and was a highly compensated active Employee for either the separation year or any determination year ending on or after the Employee's 55th birthday. The determination of who is a Highly Compensated Employee, including the determination of the compensation that is considered, will be made in accordance with Section 414(q) of the Code and the Regulations thereunder. For purposes of this Section 1.31, Compensation means Compensation within the meaning of Section 415(c)(3) of the Code as defined in Section 3.11. 1.32 "Hour of Service" means: (a) each hour for which an Employee is directly or indirectly paid or entitled to payment for the performance of duties for the Employer; (b) each hour for which an Employee is directly or indirectly paid or entitled to payment by the Employer on account of a period during which no duties are performed, whether or not the employment relationship has terminated, due to vacation, holiday, illness, incapacity (including disability), layoff, jury duty, military duty or leave of absence, but not more than 501 such hours on account of any single continuous period during which no duties are Ingram Micro Inc. Article I-10 401(k) Investment Savings Plan
performed; and (c) each hour for which back pay, irrespective of mitigation of damages, has been awarded or agreed to by the Employer. No hours shall be credited on account of any period during which an Employee performs no duties and receives payment solely for the purpose of reimbursement for medical or medically related expenses incurred by the Employee for the purpose of complying with applicable worker's compensation, unemployment compensation or disability insurance laws. Solely to the extent required by the Family and Medical Leave Act of 1993 (FMLA), an Employee shall be credited with Hours of Service while on a leave of absence protected under FMLA. The same Hours of Service shall not be credited under more than one of the above clauses (a), (b) or (c); and each hour credited to an Employee under clause (a), (b) or (c) above shall be credited in accordance with Section 2530.200b-2(b) and (c) of the U.S. Department of Labor's Regulations, which hereby are incorporated by reference. Hours of Service shall be credited for any individual considered an Employee under Section 414(n) or Section 414(o) of the Code and the related Regulations. Pursuant to Section 414(n)(4)(B) of the Code, Hours of Service shall be determined by taking into account any period for which an Employee would have been a leased employee as defined in Section 1.23 but for the fact that the Employee failed to perform services for the Employer on a substantially full-time basis for a period of at least one year. Ingram Micro Inc. Article I-11 401(k) Investment Savings Plan
1.33 "Limitation Year" means the calendar year, unless otherwise selected by the Employer in a manner consistent with that described in Section 1.415-2(b)(2) of the Regulations. 1.34 "Matching Contribution Account" means the Account to which are credited any Matching Contributions made on behalf of the Participant and earnings or losses on those contributions. 1.35 "Matching Contributions" means the amounts contributed on behalf of a Participant pursuant to Section 3.2. 1.36 "Non-highly Compensated Employee" means an Employee who is not a Highly Compensated Employee. 1.37 "Normal Retirement Age" means the date the Participant attains age 65. However, if a Participant was first hired by the Employer on or after January 1, 1994, Normal Retirement Age means the later of: (a) the date the Participant attains age 65, and (b) the earlier of (i) the date the Participant completes five Years of Service, and (ii) the fifth anniversary of the date the Participant commenced participation in the Plan. 1.38 "Participant" means any Participant participating in the Plan as provided in Article II or any former Employee whose participation has not ceased pursuant to Section 2.5. 1.39 "Period of Service" means a period of employment with the Employer determined under the following rules: (a) General Rule - An Employee's Period of Service begins on his Employment Commencement Date or Reemployment Ingram Micro Inc. Article I-12 401(k) Investment Savings Plan
Commencement Date and ends on his Severance Date subject to the Service Spanning rules in Section 1.39(b). (b) Service Spanning Rules - The Period of Service of an Employee who severs from service with the Employer by reason of retirement, quit or discharge, and who thereafter performs an Hour of Service within twelve months of his Severance Date shall include the intervening Period of Severance. The Period of Service of an Employee who severs from service by reason of retirement, quit or discharge occurring during an absence from service of twelve months or less which began for any reason other than retirement, quit or discharge, and who thereafter performs an Hour of Service within twelve months of the first day of such absence shall include the period intervening between his Severance Date and the date on which he again performs an Hour of Service. (c) Employment or Reemployment Commencement Date- An Employee's Employment Commencement Date is the date on which an Employee is first credited with an Hour of Service. An Employee's Reemployment Commencement Date is the date on which an Employee who has incurred a Period of Severance that is not taken into account as a Period of Service first performs an Hour of Service following such Period of Severance. 1.40 "Period of Severance" means any period commencing on an Employee's Severance Date except as provided in Section 1.50. 1.41 "Plan" means the Ingram Micro Inc. 401(k) Investment Savings Plan, as set forth herein and as amended from time to time. Ingram Micro Inc. Article I-13 401(k) Investment Savings Plan
1.42 "Plan Year" means the twelve (12) month period commencing on each January 1st on or after the Effective Date and ending on the next following December 31st. 1.43 "QMAC" means a qualified matching contribution made to the Plan pursuant to Section 3.8(f). 1.44 "QMAC Account" means the Account to which are credited QMACs made on behalf of a Participant pursuant to Section 3.8(f) and earnings or losses on those contributions. 1.45 "QNEC" means a qualified non-elective contribution made to the Plan pursuant to Section 3.5(f). 1.46 "QNEC Account" means the Account to which are credited QNECs made on behalf of a Participant pursuant to Section 3.5(f) and earnings or losses on those contributions. 1.47 "Regulations" means the Treasury regulations issued under the Code or any other applicable law by the Internal Revenue Service and any proposed or temporary regulations or rules pending the issuance of such regulations. 1.48 "Rollover Account" means the Participant's Account to which is credited any Rollover Contribution made by the Participant and earnings or losses on that contribution. 1.49 "Rollover Contribution" means a contribution made by a Participant pursuant to Section 3.4. Ingram Micro Inc. Article I-14 401(k) Investment Savings Plan
1.50 "Severance Date" means the earlier of (a) the date on which an Employee separates from service with the Employer by reason of his retirement, death, quit or discharge or (b) the first anniversary of the date on which the Employee begins an absence from active employment for any reason other than his retirement, death, quit or discharge. Solely for purposes of determining the extent of an Employee's Period of Severance, the Severance Date of an Employee who is absent from work for more than twelve months due to the pregnancy of the Employee, the birth of a child of the Employee or the placement of a child with the Employee in connection with the adoption of the child by the Employee or for purposes of caring for that child immediately following the child's birth or placement, shall be deemed to be the second anniversary of the first day of such absence. The period between the first and second anniversaries of the first day of such absence (or between the first anniversary and the date of the Employee's return to active employment if he returns before the second anniversary) shall be neither a Period of Service nor a Period of Severance. 1.51 "Severance from Employment" means the termination of the Employee's employment relationship with the Employer. 1.52 "Spouse" means the person to whom a Participant is legally married on the earlier of (a) the date on which the Participant's Account balances are distributed due to the Participant's Severance from Employment, or (b) the Participant's date of death. 1.53 "Trust Agreement" means the agreement entered into between the Company and the Trustee to carry out the purposes of the Plan. Ingram Micro Inc. Article I-15 401(k) Investment Savings Plan
1.54 "Trust Fund" means the assets of the Plan held in trust by the Trustee in accordance with the Trust Agreement. 1.55 "Trustee" means the trustee or trustees by whom the assets of the Plan are held in accordance with the Trust Agreement. 1.56 "Valuation Date" means any business day on which the New York Stock Exchange is open for and conducting business, or any more frequent date designated by the Administrator or the Trustee. 1.57 "Year of Service" means a Period of Service of 365 days, with less than whole year Periods of Service aggregated on the basis of days. A Participant shall receive a credit for a day of service for each day for which he is credited with an Hour of Service. A day of service counted in one Year of Service shall not be included in another Year of Service. Wherever used herein, the singular includes the plural and the masculine includes the feminine, unless the context clearly requires otherwise. Ingram Micro Inc. Article I-16 401(k) Investment Savings Plan
ARTICLE II ELIGIBILITY AND PARTICIPATION 2.1 Eligibility (a) Each Eligible Employee who was a Participant in the Plan on March 31, 2005 shall continue to participate on the Effective Date. (b) Each other Eligible Employee shall be eligible to become a Participant on any Entry Date on or after the date on which he is first credited with an Hour of Service. (c) If an Employee described in Section 1.22(d) completes at least 1,000 Hours of Service in a computation period, the Employee shall be eligible to become a Participant on the earlier of the first day of the Plan Year beginning after the computation period, or six months after the completion of such computation period. For purposes of this Section 2.1(c), computation period means the twelve month period beginning on the Employee's date of hire or any Plan Year beginning after his date of hire. 2.2 Beneficiary Designation Each Participant may file a designation in accordance with procedures established by the Administrator naming as Beneficiary a person, persons or entity to receive benefits payable upon his death. A Participant may at any time revoke or change his Beneficiary designation by filing a new designation in accordance with procedures established by the Administrator. Any Beneficiary designation or revocation or change thereof naming as primary Beneficiary a person, persons or entity other than the Participant's Spouse must be made with the written consent of the Ingram Micro Inc. Article II-17 401(k) Investment Savings Plan
Participant's Spouse acknowledging the effect of such designation, revocation or change and witnessed by a notary public. Written consent of the Participant's Spouse shall not be required if it is established in accordance with procedures established by the Administrator and applied on a uniform and nondiscriminatory basis that there is no Spouse, the Spouse cannot be located or under other circumstances as may be prescribed in Regulations. If the Participant is unmarried and fails to designate a Beneficiary or the Beneficiary does not survive the Participant, the benefits payable upon the death of the Participant will be paid to the Participant's estate. 2.3 Eligibility Upon Reemployment Any person reemployed by an Employer as an Eligible Employee shall again be eligible to become a Participant as of his date of rehire. 2.4 Transferred Employees (a) A Participant who remains in the employ of the Employer but ceases to be an Eligible Employee shall continue to be a Participant and shall be credited with Hours of Service, but he shall not be eligible to have Before-Tax Contributions, After-Tax Contributions, Catch-up Contributions or Employer contributions made on his behalf for as long as his employment status is other than that of an Eligible Employee. Any Compensation of such a Participant while he has an employment status other than that of an Eligible Employee shall be disregarded for all Plan purposes. (b) If an Employee transfers from an employment status with an Employer other than as an Eligible Employee and thereby becomes an Eligible Employee, he shall be eligible to become a Participant and have Before- Ingram Micro Inc. Article II-18 401(k) Investment Savings Plan
Tax, After-Tax Contributions, Catch-up Contributions and Employer contributions made on his behalf as of the next following Entry Date. 2.5 Termination of Participation A Participant's participation shall cease upon distribution to him of his entire vested Account or upon his death prior to such distribution. Ingram Micro Inc. Article II-19 401(k) Investment Savings Plan
ARTICLE III CONTRIBUTIONS AND ALLOCATIONS 3.1 Employee Contributions An Eligible Employee who meets the requirements of Section 2.1 may make Before-Tax Contributions and/or After-Tax Contributions in accordance with the respective provisions of this Section 3.1. (a) Before-Tax Contributions (1) An Eligible Employee who meets the requirements of Section 2.1 may, by advance notice in accordance with procedures prescribed by the Administrator, elect to have his subsequent Compensation reduced by means of payroll reduction as of any Entry Date and to have an equal amount contributed to the Plan on his behalf as Before-Tax Contributions. The reduction shall commence effective with the first payroll period that begins as soon as administratively practicable thereafter. (2) An Eligible Employee who is not a Highly Compensated Employee may elect to make Before-Tax Contributions of up to fifty percent (50%) of his Compensation, in one percent (1%) increments, reduced by the amount of any After-Tax Contributions made on his behalf pursuant to Section 3.1(b). (3) An Eligible Employee who is a Highly Compensated Employee may elect to make Before-Tax Contributions of up to the whole percentage of his Compensation designated as permissible by the Administrator, reduced by the amount of any After-Tax Contributions made on his Ingram Micro Inc. Article III-1 401(k) Investment Savings Plan
behalf pursuant to Section 3.1(b). In no event shall the percentage so designated by the Administrator exceed the maximum percentage of Compensation that an Eligible Employee who is not a Highly Compensated Employee may elect to contribute for such Plan Year. (4) In no event will the Before-Tax Contributions made on behalf of a Participant exceed the dollar limit in effect under Section 402(g) of the Code, reduced by the amount of the Participant's other Before-Tax Contributions made through the Employer for the calendar year. (5) The percentage of contributions designated by a Participant pursuant to Section 3.1(a) shall automatically apply to increases and decreases in his Compensation. A Participant may, in accordance with applicable administrative procedures, change the percentage of his Compensation to be contributed to the Plan as Before-Tax Contributions as of any Entry Date. The change shall commence effective with the first payroll period that begins as soon as administratively practicable thereafter. The changed percentage shall remain in effect until subsequently changed. (6) A Participant may, by giving advance notice in accordance with applicable administrative procedures, elect to suspend his Before-Tax Contributions at any time. The suspension shall commence effective with the next payroll period that begins as soon as administratively practicable thereafter. A Participant who has suspended his Before-Tax Contributions may, by giving advance notice in accordance with applicable administrative procedures, elect to resume making Before-Tax Contributions as of any Entry Date thereafter. The resumption shall commence effective with the first payroll period that begins as soon as administratively practicable thereafter. Ingram Micro Inc. Article III-2 401(k) Investment Savings Plan
(7) A Before-Tax Contribution may be taken into account for purposes of determining the Actual Deferral Percentage only if each of the following requirements is satisfied: (1) the Before-Tax Contribution is allocated to the Participant's Account as of a date within the Plan Year; and (2) the Before-Tax Contribution relates to Compensation that either (i) would have been received by the Participant in the Plan Year but for the Participant's election to defer, or (ii) is attributable to services performed by the Participant in the Plan Year and, but for the Participant's election to defer, would have been received by the Participant within two and one-half months after the close of the Plan Year. For purposes of (1), a Before-Tax Contribution is considered allocated as of a date within a Plan Year only if (i) the allocation is not contingent upon the Participant's participation in the Plan or performance of services on any date subsequent to that date, and (ii) the Before-Tax Contribution is actually paid to the Trust no later than the end of the twelve month period immediately following the Plan Year to which the Before-Tax Contribution relates. (8) If Before-Tax Contributions are returned to the Employer under Section 3.12, the elections to reduce Compensation that were made by Participants on whose behalf those contributions were made shall be void retroactively to the beginning of the period for which returned contributions were made. (b) After-Tax Contributions (1) An Eligible Employee who meets the requirements of Section 2.1 may, by advance notice in accordance with procedures prescribed by the Ingram Micro Inc. Article III-3 401(k) Investment Savings Plan
Administrator, elect to contribute After-Tax Contributions to the Plan by means of payroll deduction as of any Entry Date. (2) An Eligible Employee who is not a Highly Compensated Employee may elect to make After-Tax Contributions of up to fifty percent (50%) of his Compensation, in one percent (1%) increments, reduced by the amount of any Before-Tax Contributions made on his behalf pursuant to Section 3.1(a). (3) An Eligible Employee who is a Highly Compensated Employee may elect to make After-Tax Contributions of up to the whole percentage of his Compensation designated as permissible by the Administrator, reduced by the amount of any Before-Tax Contributions made on his behalf pursuant to Section 3.1(a). In no event shall the percentage so designated by the Administrator exceed the maximum percentage of Compensation that an Eligible Employee who is not a Highly Compensated Employee may elect to contribute for such Plan Year. 3.2 Employer Contributions The Employer may make a Matching Contribution for each Participant who makes Before-Tax Contributions and/or After-Tax Contributions for the payroll period equal to fifty percent (50%) of the Participant's Before-Tax Contributions and/or After-Tax Contributions for the payroll period not exceeding five percent (5%) of the Participant's Compensation for the payroll period. Matching Contributions shall not be made on account of Catch-Up Contributions. For purposes of determining the Matching Contribution, if any, for a Plan Year, any amounts paid under the Annual Incentive Award Program and the Ingram Micro Inc. Article III-4 401(k) Investment Savings Plan
Long-Term Executive Cash Incentive Award Program shall be excluded from Compensation. The Employer shall determine, in its absolute discretion, whether Matching Contributions shall be made for a Plan Year. The Employer is not required to contribute Matching Contributions for any Plan Year. Notwithstanding the foregoing, the Employer may discontinue Matching Contributions for Participants who are Highly Compensated Employees if it is determined that continuation of such contributions in accordance with this Section 3.2 might cause the Plan to exceed the limitations of Section 401(m) of the Code and Section 3.8 of the Plan. The Employer, in its discretion, may make additional Matching Contributions with respect to Participants who are Non-highly Compensated Employees in the event such contributions are necessary to pass the Actual Contribution Percentage Test in Section 3.8. 3.3 Catch-Up Contributions Each Participant who has attained age 50 before the close of the Plan Year shall be eligible to make Catch-Up Contributions of up to twenty-five (25%) of Compensation in accordance with, and subject to, the limitations of Section 414(v) of the Code. Such Catch-Up Contributions shall not be taken into account for purposes of the provisions of the Plan implementing the required limitations of Sections 402(g) and 415 of the Code. The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing the requirements of Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416 of the Code, as applicable, by reason of making such Catch-Up Contributions. Ingram Micro Inc. Article III-5 401(k) Investment Savings Plan
3.4 Rollover Contributions (a) An Eligible Employee may, by notice received by the Administrator and under such terms and conditions as the Administrator shall determine, make a Rollover Contribution to the Plan and Trust Fund. The Administrator may require the individual to submit such evidence and documentation as the Administrator determines necessary to be assured that the proposed contribution qualifies as a Rollover Contribution. A Rollover Contribution is (1) a distribution of an "eligible rollover distribution" (as defined in Section 402(c)(4) of the Code) from a qualified plan described in Section 401(a) or 403(a) of the Code, an annuity contract described in Section 403(b) of the Code or an eligible plan under Section 457(b) of the Code which is maintained by a state political subdivision of a state, or an agency or instrumentality of a state or political subdivision of a state, (2) a distribution from an individual retirement account or individual retirement annuity described in Section 408 of the Code that is eligible to be rolled over and would otherwise be includible as gross income, or (3) a direct rollover of an eligible rollover distribution from (i) a qualified plan described in Section 401(a) or 403(a) of the Code excluding after-tax employee contributions, (ii) an annuity contract described in Section 403(b) of the Code excluding after-tax employee contributions, or (iii) an eligible plan under Section 457(b)of the Code which is maintained by a state, political subdivision of a state, or an agency or instrumentality of a state of political subdivision of a State. Section 402(c)(9) shall apply in determining whether a distribution is a Rollover Contribution for purposes of Section 3.4. Ingram Micro Inc. Article III-6 401(k) Investment Savings Plan
(b) A distribution described in (a)(1) or (2) above must be received by the Trust Fund on or before the 60th day following the Employee's receipt of the distribution from the distributing plan or contract. (c) The amount received pursuant to this Section 3.4 shall be transferred to the Trust Fund and credited to a separate Rollover Contribution Account maintained by the Administrator for the Employee in accordance with Article IV herein. 3.5 Actual Deferral Percentage Test (a) For the Plan Year, the Average Actual Deferral Percentage for the group of all Highly Compensated Employees who are Eligible Employees must satisfy at least one of the following tests: (1) the Average Actual Deferral Percentage for said group of Highly Compensated Employees for that Plan Year shall not be more than the Average Actual Deferral Percentage for the group of Non-highly Compensated Employees who were Eligible Employees for the prior Plan Year multiplied by 1.25; or (2) the Average Actual Deferral Percentage for said group of Highly Compensated Employees for that Plan Year shall not exceed two (2) percentage points more than the Average Actual Deferral Percentage for the group of Non-highly Compensated Employees who were Eligible Employees for the prior Plan Year, and the Average Actual Deferral Percentage for said group of Highly Compensated Employees for that Plan Year shall not be more than the Average Actual Deferral Percentage for the group of Non-highly Compensated Employees who were Eligible Employees for the prior Plan Year multiplied by 2. Ingram Micro Inc. Article III-7 401(k) Investment Savings Plan
For Plan Years beginning on or after January 1, 2006, the Average Actual Deferred Percentage for the group of Non-highly Compensated Employees for purposes of the foregoing tests shall be based on the Average Actual Deferral Percentage for the group of Non-highly Compensated Employees who are eligible to participate in the Plan in the current Plan Year. (b) If Before-Tax Contributions are made to the Plan for a Plan Year for a Highly Compensated Employee who also is eligible to have salary reduction contributions allocated to his account under another plan maintained by the Employer that provides a cash or deferred arrangement described in Section 401(k) of the Code, the Actual Deferral Percentage for that Highly Compensated Employee shall be calculated as if all such other plans are part of the Plan. However, if a Highly Compensated Employee participates in two (2) or more cash or deferred arrangements that are parts of plans that have different plan years, the cash or deferred arrangements shall be treated as a single arrangement with respect to the plan years ending with or within the same calendar year. (c) If the Plan satisfies the requirements of Section 401(k), 401(a)(4) or 410(b) of the Code only if aggregated with one or more other plans, or if one or more plans satisfy the requirements of such sections of the Code only if aggregated with the Plan, this Section 3.5 shall be applied by determining the Actual Deferral Percentages of Employees as if all such plans were a single plan. However, plans may be aggregated in order to satisfy Section 401(k) of the Code only if they have the same plan year. (d) For the purposes of satisfying the requirements of Section 401(k), 401(a)(4) or 410(b) of the Code, the Plan may be disaggregated into two or more plans or the Plan may be aggregated with one or more other plans, to the extent Ingram Micro Inc. Article III-8 401(k) Investment Savings Plan
permitted by Sections 401(k), 401(a)(4) and 410(b) of the Code and the Regulations thereunder. (e) For purposes of determining the Actual Deferral Percentage, Before-Tax Contributions must be made before the last day of the twelve (12) consecutive month period immediately following the Plan Year to which those contributions relate. (f) To enable the Plan to satisfy the test described in Section 3.5(a), the Employer may elect to make a QNEC to the Plan for each Plan Year in an amount, if any, that the Employer, in its sole discretion, determines. All QNECs will be one hundred percent (100%) vested and subject to the distribution requirements applicable to Before-Tax Contributions as described in Section 401(k)-1(d) of the Treasury Regulations. QNECs will be allocated to the Participant's QNEC Account as of the end of the Plan Year with respect to which the QNEC is made. QNECs will be paid to the Trustee after such contribution is authorized by the Employer but no later than twelve (12) months after the end of the Plan Year in which such contribution is allocated. 3.6 Reductions During Plan Year If, during the Plan Year, the Administrator determines that the Actual Deferral Percentage test provided in Section 3.5 is not met at the time of its review or would not be met if part or all of Before-Tax Contributions continue to be made on behalf of Participants who are Highly Compensated Employees, the Administrator, in its sole discretion, may reduce the rate (to zero (0) if necessary) of Before-Tax Contributions that would have been made during the remainder of the Plan Year. The Administrator may, in its sole and absolute discretion, limit or discontinue the Before-Tax Contributions of Highly Compensated Employees to comply with the contribution limits set forth herein. Ingram Micro Inc. Article III-9 401(k) Investment Savings Plan
3.7 Return or Recharacterization of Excess Contributions After End of Plan Year (a) If, after the last day of the Plan Year, the Administrator determines that the Average Actual Deferral Percentage requirements of Section 3.5 have not been satisfied, the Administrator, within two and one-half (2 1/2) months after the end of the Plan Year (but not later than the last day of the next Plan Year), shall distribute the Excess Contributions, adjusted for any income or loss, to all affected Participants who are Highly Compensated Employees. The Administrator shall calculate any Excess Contributions after determining the amount of Excess Deferrals pursuant to Section 3.10. The amount of Excess Contributions to be distributed shall be reduced by any Excess Deferrals previously distributed to the Participant for the tax year ending with or within the Plan Year. The amount of Excess Deferrals to be distributed for a tax year shall be reduced by any Excess Contributions previously distributed for the Plan Year beginning with or within the Participant's tax year. (b) The income or loss allocable to Excess Contributions for the Plan Year shall be determined by multiplying the income or loss allocable to the Participant's Before-Tax Contributions for the Plan Year by a fraction, the numerator of which is the Excess Contribution on behalf of the Participant for the Plan Year and the denominator of which is the Participant's Account balance attributable to Before-Tax Contributions on the last day of the Plan Year, without regard to any income or loss during the Plan Year. No income or loss shall be attributable to the period between the end of the Plan Year and the date of the distribution. (c) The amount of Excess Contributions for Highly Compensated Employees shall be determined as provided in this paragraph. First, the Actual Deferral Percentage of the Highly Compensated Employee with the highest such Ingram Micro Inc. Article III-10 401(k) Investment Savings Plan
Percentage will be reduced to the extent necessary to satisfy the Actual Deferral Percentage test or cause the percentage for that Highly Compensated Employee to equal the percentage for the Highly Compensated Employee with the next highest such Percentage. Second, this process will be repeated until the Actual Deferral Percentage test is satisfied. The total of such Excess Contributions shall then be distributed to Highly Compensated Employees in descending order commencing with the Highly Compensated Employee with the highest dollar amount of Before-Tax Contributions and other contributions to be distributed in order to satisfy the Actual Deferral Percentage test, consistent with the provisions of Notice 97-2 issued by the Internal Revenue Service. (d) Excess Contributions distributed to Participants in accordance with this Section 3.7 shall be distributed in the following order: (1) from the Participant's Before-Tax Contribution Account, to the extent such Contributions are not subject to Matching Contributions, and (2) from the Participant's Before-Tax Contribution Account, to the extent such contributions are subject to Matching Contributions. If Excess Contributions are distributed to Participants in accordance with this Section 3.7, the Participant shall immediately forfeit all Matching Contributions that were made to match such distributed Excess Contributions. (e) For purposes of this Section 3.7, Excess Contributions means Before-Tax Contributions in excess of the Actual Deferral Percentage limit as described in Section 401(k)(8)(B) of the Code. (f) A Participant may elect to treat his or her Excess Contributions as an amount distributed to the Participant and then contributed by the Participant to the Plan as an After-Tax Contribution. Such recharacterized amounts will remain nonforfeitable and subject to the same distribution requirements as Before- Ingram Micro Inc. Article III-11 401(k) Investment Savings Plan
Tax Contributions. Amounts may not be recharacterized by a Highly Compensated Employee to the extent that such amount in combination with other Participant contributions made by that Employee under all plans maintained by the Employer would exceed any stated limit under the Plan for Participant contributions. Excess Contributions may not be recharacterized under this paragraph any later than 2 1/2 months after the last day of the Plan Year in which the Excess Contributions arise. Recharacterization will be deemed to occur on the date the last Highly Compensated Employee is informed in writing of the amount to be recharacterized and the consequences thereof. Recharacterized amounts will be taxable to the Participant for the Participant's tax year in which the Participant would have received such amounts in cash. 3.8 Actual Contribution Percentage Test (a) For any Plan Year beginning before January 1, 2006, the Average Contribution Percentage for the group of all Highly Compensated Employees who are Eligible Employees must satisfy at least one of the following tests: (1) The Average Contribution Percentage for said group of Highly Compensated Employees for that Plan Year shall not be more than the Average Contribution Percentage for the group of Non-highly Compensated Employees who were Eligible Employees for the prior Plan Year multiplied by 1.25; or (2) The Average Contribution Percentage for said group of Highly Compensated Employees for that Plan Year shall not exceed 2 percentage points more than the Average Contribution Percentage for the group of Non-highly Compensated Employees who were Eligible Employees for the prior Plan Year, and the Average Contribution Percentage for said group of Highly Compensated Employees for that Ingram Micro Inc. Article III-12 401(k) Investment Savings Plan
Plan Year shall not be more than the Average Contribution Percentage for the group of Non-highly Compensated Employees who were Eligible Employees for the prior Plan Year multiplied by 2. For Plan Years beginning on or after January 1, 2006, the Average Contribution Percentage for the group of Non-highly Compensated Employees for purposes of the foregoing tests shall be based on the Average Contribution Percentage for the group of Non-highly Compensated Employees who are eligible to participate in the Plan in the current Plan Year. (b) If After-Tax and/or Matching Contributions are made to the Plan for a Plan Year for a Highly Compensated Employee who also is eligible to have after-tax contributions and/or matching contributions allocated to his account under another plan maintained by the Employer that is qualified under Section 401(a) of the Code, the Contribution Percentage for that Highly Compensated Employee shall be calculated as if all such other plans are part of the Plan. However, plans that are not permitted to be aggregated under Reg. Sec. 1.410(b)-7(c), as modified by Reg. Sec. 1.401(k)-1(g)(11), are not aggregated for this purpose. If a Highly Compensated Employee participates in two or more plans that have different plan years, this Section 3.8 shall be applied by treating all plans that have plan years ending with or within the same calendar year as a single plan. (c) If the Plan satisfies the requirements of Sections 401(m), 401(a)(4) and 410(b) of the Code only if aggregated with one or more other plans, or if one or more other plans satisfy the requirements of such sections of the Code only if aggregated with the Plan, this Section shall be applied by determining the Contribution Percentages of Employees as if all such plans were a single plan. However, plans may be aggregated in order to satisfy Section 401 (m) of the Code only if they have the same plan years. Ingram Micro Inc. Article III-13 401(k) Investment Savings Plan
(d) For the purposes of satisfying the requirements of Section 401(m), 401(a)(4) or 410(b) of the Code, the Plan may be disaggregated into two or more plans or the Plan may be aggregated with one or more other plans, to the extent permitted by Sections 401(m), 401(a)(4) and 410(b) of the Code and the Regulations thereunder. (e) For purposes of determining the Contribution Percentage, (i) After-Tax Contributions are considered to have been made in the Plan Year as of which they are contributed to the Trust Fund and (ii) Matching Contributions will be considered made for a Plan Year if made before the last day of the twelve (12) consecutive month period immediately following the Plan Year to which those contributions relate. (f) To enable the Plan to satisfy the test described in Section 3.8(a), the Employer may elect to make a QMAC to the Plan for each Plan Year in an amount, if any, as determined by the Employer in its sole discretion. All QMACs made pursuant to this Section 3.8(f) will be one hundred percent (100%) vested and subject to the distribution requirements applicable to Before-Tax Contributions as described in Section 1.401(k)-1(d) of the Treasury Regulations. QMACs will be allocated to the Participant's QMAC Account as of the end of the Plan Year with respect to which the QMAC is made. QMACs will be paid to the Trustee after such contribution is authorized by the Employer, but no later than twelve (12) months after the end of the Plan Year in which such contribution is allocated. 3.9 Return of Excess Aggregate Contributions (a) If, after the last day of the Plan Year, the Administrator determines that the Average Contribution Percentage requirements of Section 3.8 have not been Ingram Micro Inc. Article III-14 401(k) Investment Savings Plan
satisfied, the Administrator, within two and one-half (2 1/2) months after the end of the Plan Year (but not later than the last day of the next Plan Year), shall first cause to be forfeited, if forfeitable, or if not forfeitable, distribute the Excess Aggregate Contributions, adjusted for any income or loss, to all affected Participants who are Highly Compensated Employees. The Administrator shall calculate any Excess Aggregate Contributions after determining the amount of Excess Deferrals pursuant to Section 3.10 and the amount of Excess Contributions pursuant to Section 3.7. (b) The income or loss allocable to Excess Aggregate Contributions for the Plan Year shall be determined by multiplying the income or loss allocable to Matching Contributions and After-Tax Contributions made on behalf of the Participant for the Plan Year by a fraction, the numerator of which is the Excess Aggregate Contribution on behalf of the Participant for the Plan Year and the denominator of which is the Participant's Matching Contribution Account and After-Tax Contribution Account balances on the last day of the Plan Year, without regard to any income or loss during the Plan Year. No income or loss shall be attributable to the period between the end of the Plan Year and the date of the distribution. (c) The amount of Excess Aggregate Contributions for Highly Compensated Employees shall be determined as provided in this Section 3.9. First, the Contribution Percentage of the Highly Compensated Employee with the highest such Percentage will be reduced to the extent necessary to satisfy the Contribution Percentage test or cause the percentage for that Highly Compensated Employee to equal the percentage for the Highly Compensated Employee with the next highest such Percentage. Second, this process will be repeated until the Contribution Percentage test is satisfied. The total of such Excess Aggregate Contributions to be distributed shall then be distributed to Highly Compensated Employees in descending order Ingram Micro Inc. Article III-15 401(k) Investment Savings Plan
commencing with the Highly Compensated Employee with the highest dollar amount of Excess Aggregate Contributions and other contributions to be distributed in order to satisfy the Contribution Percentage test, consistent with the provisions of Notice 97-2 issued by the Internal Revenue Service. (d) Excess Aggregate Contributions forfeited in accordance with this Section 3.9 shall be treated as Annual Additions under Section 3.11 and shall be applied to reduce subsequent Matching Contributions. (e) Excess Aggregate Contributions distributed to Participants in accordance with this Section 3.9 shall be distributed in the following order: (1) from the Participant's After-Tax Contribution Account, and (2) from the Participant's Matching Contribution Account. 3.10 Distribution of Excess Deferrals (a) A Participant may state a claim for the return of Excess Deferrals and such Excess Deferrals, adjusted for any income or loss, shall be distributed if administratively practicable no later than the April 15th following the calendar year for which such allocable Excess Deferrals are made. The Participant's claim shall be made in accordance with procedures established by the Administrator, shall be submitted to the Administrator no later than March 1st (or as late as April 14 if allowed by the Administrator), shall specify the Participant's Excess Deferrals for the preceding calendar year, and shall be accompanied by the Participant's statement that such amounts, if not distributed, will constitute Excess Deferrals. (b) The income or loss allocable to Excess Deferrals for the Plan Year shall be determined by multiplying the income or loss allocable to the Participant's Before-Tax Contributions for the Plan Year by a fraction, the numerator of Ingram Micro Inc. Article III-16 401(k) Investment Savings Plan
which is the Excess Deferrals on behalf of the Participant for the Plan Year and the denominator of which is the Participant's Account attributable to Before-Tax Contributions on the last day of the Plan Year, without regard to any income or loss during the Plan Year. No income or loss shall be attributable to the period between the end of the Plan Year and the date of the distribution. (c) If Excess Deferrals have previously been distributed within the Plan Year, the Plan shall offset such distribution from the amount of the Participant's Excess Contributions, if any, to be distributed for such Plan Year. In addition, the amount of Excess Deferrals that may be distributed for a Participant by the Plan for a Plan Year shall be reduced by the amount of Excess Contributions previously distributed. (d) Excess Deferrals are Before-Tax Contributions in excess of the limit imposed by Section 402(g) of the Code. (e) Excess Deferrals shall be taken first from unmatched Before-Tax Contributions and then from matched Before-Tax Contributions. Any Matching Contributions attributable to refunded Excess Deferrals, adjusted for investment gain or loss, shall be forfeited and used in the manner described in Section 6.3. 3.11 Maximum Annual Additions (a) The Annual Addition to a Participant's Accounts for any Limitation Year, when added to the annual additions for such year under any other defined contribution plans (including voluntary employee contribution accounts in a defined benefit plan and key employee accounts under a welfare benefit plan described in Section 419 of the Code as well as employer contributions Ingram Micro Inc. Article III-17 401(k) Investment Savings Plan
allocated to an IRA) maintained by the Employer, shall not exceed the lesser of: (1) one hundred percent (100%) of the Participant's Compensation as defined in Section 415(c)(3) of the Code for that Limitation Year, or (2) $42,000 multiplied by the Adjustment Factor. The Compensation limitation referred to in (1) shall not apply to any contribution for medical benefits after separation from service (within the meaning of Section 401(h) or 419A(f)(2) of the Code) which is otherwise treated as an Annual Addition. Effective January 1, 2005, Compensation as defined in Section 415(c)(3) of the Code means wages within the meaning of Section 3401(a) of the Code and all other payments of compensation to an Employee by the Employer (in the course of Employer's trade or business) for which the Employer is required to furnish the Employee a written statement under Sections 6041(d), 6051(a)(3), and 6052 of the Code. Compensation must be determined without regard to any rules under Section 3401(a) that limit the remuneration included in wages based on the nature or location of the employment or the services performed (such as the exception for agricultural labor in Section 3401(a)(2) of the Code). Compensation for a Limitation Year is the compensation actually paid or made available during such Limitation Year. Compensation for a Participant in a defined contribution plan who is permanently and totally disabled (as defined in Section 22(e)(3) of the Code) is the compensation such Participant would have received for the Limitation Ingram Micro Inc. Article III-18 401(k) Investment Savings Plan
Year if the Participant was paid at the rate of compensation paid immediately before becoming permanently and totally disabled. Compensation paid or made available during a Limitation Year shall include any elective deferral as defined in Section 402(g)(3) of the Code and any amount which is contributed or deferred by the Employer at the election of the Participant and which is not includible in the gross income of the Participant by reason of Section 125, 132(f)(4) or 457 of the Code. The Trustees shall, pursuant to the Administrator's directions, distribute the excess of a Participant's Annual Additions comprising (i) After-Tax Contributions and (ii) Before-Tax Contributions, in that order, over the limits stated above to the Participant in the event that such excess is caused by the allocation of forfeitures, a reasonable error in estimating a Participant's Compensation or in determining the amount of After-Tax Contributions and/or Before-Tax Contributions that may be made with respect to the Participant for the Plan Year or other circumstances approved by the Commissioner of Internal Revenue. Any contributions to be so distributed shall include any income but not any loss attributable thereto, to the extent permitted by Regulations, and the Participant shall immediately forfeit all Matching Contributions, including any income but not any loss attributable thereto, that were made to match such distributed After-Tax Contributions and/or Before-Tax Contributions. Such forfeited Matching Contributions shall be held unallocated in a suspense account and credited as part of Matching Contributions for the next and succeeding Limitation Years, as necessary, for all Participants in the Plan. Investment income less loss attributable to amounts held in such suspense account shall be similarly applied and shall be treated as Annual Additions when allocated to Participants' Accounts. Ingram Micro Inc. Article III-19 401(k) Investment Savings Plan
3.12 Return of Contributions to Employer (a) If all or part of the Employer's contributions hereunder are conditioned upon their deductibility under Section 404 of the Code and the deduction for all or any part of such contributions to the Plan is disallowed by the Internal Revenue Service, the portion of the contributions to which such disallowance applies shall be returned to the Employer without interest, but reduced by any investment loss attributable to those contributions. The return shall be made as soon as practicable within one (1) year after the disallowance. All Contributions to the Plan are conditioned on their deductibility. (b) If a contribution is made due to a mistake of fact, the Employer may require the Trustee to return the contribution, without interest but reduced by any investment loss allocable to the contribution. The return shall be made as soon as practicable within one (1) year after the date the contribution was made. (c) If, upon termination of the Plan, there remain Trust assets held in suspense accounts, the Trustee shall return such assets to the Employer. Notwithstanding the foregoing, the Employer may elect to reallocate the assets held in suspense accounts to those Employees who are Participants under the Plan as of the date of termination of the Plan in proportion to their Compensation. 3.13 Rights of Reemployed Veterans In accordance with Section 13.15, a Reemployed Veteran shall be entitled to the restoration of certain benefits under the Plan that would have accrued, or that he or she would have received, under the Plan but for his or her absence from the employ of the Employer due to Qualified Military Ingram Micro Inc. Article III-20 401(k) Investment Savings Plan
Service. A Reemployed Veteran is defined as an Employee who left the employ of the Employer to perform service in the Armed Services of the United States, and subsequently was reemployed by the Employer pursuant to the Uniformed Services Employment and Reemployment Rights Act of 1994 ("USERRA"). 'Qualified Military Service' is defined as service in the uniformed services (as defined in chapter 43 of title 38, United States Code) performed by the Reemployed Veteran whose entitlement to reemployment rights pursuant to USERRA arose with respect to such service. (a) Crediting of Period of Qualified Military Service To the extent required by USERRA and Section 414(u) of the Code, the Reemployed Veteran, for all purposes under the Plan, shall be credited Hours of Service for his or her absence from the employ of the Employer due to Qualified Military Service, in accordance with the regulations or other rules provided by the Internal Revenue Service. (b) "Make-Up" Contributions To the extent required by USERRA and Section 414(u) of the Code, the Reemployed Veteran shall be permitted to make additional contributions and receive related Matching Contributions during the period which (1) begins on the Reemployed Veteran's date of reemployment with the Employer, and (2) has the same length as the lesser of: (i) the period of Qualified Military Service multiplied by 3, or (ii) five (5) years. The maximum amount of additional contributions that the Reemployed Veteran is permitted to make is the maximum amount of such contributions that the Reemployed Veteran would have been permitted to make had he or she continued to be employed by the Employer during the period of Qualified Ingram Micro Inc. Article III-21 401(k) Investment Savings Plan
Military Service and received Compensation. Compensation for purposes of this Section 3.13 shall be based on the rate of pay that the Reemployed Veteran would have received during the period of Qualified Military Service had he remained employed by the Employer. If such rate of pay was not reasonably certain, such Compensation shall be based on the Reemployed Veteran's average Compensation from the Employer during (1) the twelve (12) month period immediately before the Qualified Military Service, or (2) if shorter, the period of employment immediately before the Qualified Military Service. If any contribution is made by an Employer or an Employee under the Plan with respect to an Employee whose reemployment is governed by USERRA: (i) Such contribution shall not be subject to any otherwise applicable limitation contained in Section 402(g), 402(h), 403(b), 404(a), 404(h), 408, 415 or 457 of the Code and shall not be taken into account in applying such limitations to other contributions or benefits under such plan or any other plan, with respect to the year in which the contribution is made; (ii) Such contribution shall be subject to the limitations referred to in (i) above with respect to the year to which the contribution relates (in accordance with rules prescribed by the Secretary of the Treasury); and (iii) The Plan shall not be treated as failing to meet the requirements of Section 401(a)(4), 401(a)(26), 401(k)(3), 401(k)(11), 401(k)(12), 401(m), 403(b)(12), 408(k)(3), 408(k)(6), 408(p), 410(b) or 416 of the Code by reason of the making of (or the right to make) such contribution. Ingram Micro Inc. Article III-22 401(k) Investment Savings Plan
3.14 Early Participation Testing Rule If the Employer elects to apply Section 410(b)(4)(B) of the Code in determining whether the Plan satisfies the requirements of Section 410(b) of the Code, the Employer may, in determining whether the Plan meets the requirements of Section 3.5 and/or Section 3.8 exclude from consideration all Eligible Employees (other than Highly Compensated Employees) who have not met the minimum age and service requirements of Section 410(a)(1)(A) of the Code. Ingram Micro Inc. Article III-23 401(k) Investment Savings Plan
ARTICLE IV MAINTENANCE AND VALUATION OF ACCOUNTS 4.1 Maintenance of Accounts A separate After-Tax Contribution Account, Before-Tax Contribution Account, Catch-Up Contribution Account, Matching Contribution Account, and if necessary, QMAC Account, QNEC Account and Rollover Contribution Account shall be maintained for each Participant as well as any other accounts or subaccounts as the Administrator deems necessary or desirable. 4.2 Valuation of Accounts As of each Valuation Date, the Accounts of each Participant shall be adjusted to reflect contributions, withdrawals, distributions, income earned or accrued, expenses paid from the assets of the Plan and any increase or decrease in the fair market value of the assets of the Plan since the preceding Valuation Date. 4.3 Account Statements At least once a year, each Participant shall be furnished with a statement stating the dollar value of his Accounts and the vested portion of his Accounts. Ingram Micro Inc. Article IV-1 401(k) Investment Savings Plan
ARTICLE V INVESTMENT OF CONTRIBUTIONS 5.1 Investment Funds (a) The Administrator from time to time shall direct the Trustee to establish and maintain one or more Investment Funds, hereinafter referred to as Funds, for the investment of assets of the Trust Fund. The number and type of Funds shall be determined by the Administrator, which may, in its discretion, direct the Trustee to establish and maintain one or more additional Funds or to delete one or more existing Funds. (b) Pending the investment of any amounts in a Fund, the Trustee may invest assets of the Trust Fund temporarily in interest-bearing accounts, certificates of deposit, Treasury bills, commercial paper, money market funds, short-term obligations of the United States Government, short-term investment funds or other short-term obligations selected by the Trustee. The Trustee may keep such amounts of cash as it, in its sole discretion, shall deem necessary or advisable as part of such Funds, all within the limitations specified in the Trust Agreement. (c) All interest, dividends and proceeds from the disposition of and other income received with respect to assets held with respect to each of the Funds shall be reinvested in the respective Fund and all expenses of the Trust that are properly allocable to a particular Fund shall be so allocated and charged. Ingram Micro Inc. Article V-1 401(k) Investment Savings Plan
5.2 Investment of Participant Accounts A Participant may, in accordance with applicable administrative procedures, specify the percentages of his Accounts that shall be invested in each Fund maintained under the Plan. If a Participant fails to make an election pursuant to this Section 5.2, all of his Accounts shall be invested in the Fund that the Administrator determines, in its sole discretion, is consistent with the prudent discharge of its fiduciary duties. A Participant may not invest more than fifty percent (50%) of his Before-Tax Contributions and After-Tax Contributions in the Ingram Micro Stock Fund. Rollover Contributions may not be invested in the Ingram Micro Stock Fund. 5.3 Responsibility for Investments Each Participant is solely responsible for the selection of his investment options. The Trustee, the Administrator, the Employer and the officers, supervisors and other employees of the Employer are not empowered to advise a Participant as to the manner in which his Accounts shall be invested. The fact that a particular Fund is available to Participants for investment under the Plan shall not be construed as a recommendation for investment in that Fund. The Trustee shall be the named fiduciary for the purposes of carrying out the Participant's investment instructions. Ingram Micro Inc. Article V-2 401(k) Investment Savings Plan
5.4 Changing Investment Elections - Future Contributions A Participant may, in accordance with applicable administrative procedures, change his investment election as to subsequent contributions, subject to the limitations of Section 5.2, as of any Valuation Date. 5.5 Transfer Among Funds A Participant may, in accordance with applicable administrative procedures and subject to any restrictions that may imposed by particular Funds, elect to transfer all or a portion of the balance in all of his Accounts between and among Funds as of any Valuation Date. The Employer, however, reserves the right, in its sole discretion, to implement reasonable restrictions on a Participant's right to transfer among Funds. A Participant is not permitted to transfer other investment options to the Ingram Micro Stock Fund. A Participant is permitted to transfer all or any portion of his investment in the Ingram Micro Stock Fund in five percent (5%) increments out of that Fund and into other investment options. A Participant who is subject to Rule 16b-3 of the Securities and Exchange Commission or who is designated by the Employer as a window group person is only permitted to transfer contributions invested in the Ingram Micro Stock Fund out of that Fund during a special open window period established by the Employer. Ingram Micro Inc. Article V-3 401(k) Investment Savings Plan
ARTICLE VI VESTING 6.1 Vesting in After-Tax Contribution, Before-Tax Contribution, Catch-Up Contribution, QMAC, QNEC and Rollover Accounts A Participant shall at all times have a one hundred percent (100%) nonforfeitable vested right to the value of his After-Tax Contribution, Before-Tax Contribution Account, Catch-Up Contribution Account, QMAC Account, QNEC Account and Rollover Account. 6.2 Vesting in Matching Contribution Account (a) A Participant shall have a nonforfeitable vested right to the value of his Matching Contribution Account in accordance with the following schedule: YEARS OF SERVICE VESTED PERCENTAGE - ---------------- ----------------- Less than 1 year 0 1 year but less than 2 20 2 years but less than 3 40 3 years but less than 4 60 4 years but less than 5 80 5 or more years 100 Ingram Micro Inc. Article VI-1 401(k) Investment Savings Plan
(b) Notwithstanding the provisions of (a) above, a Participant shall have a one hundred percent (100%) nonforfeitable vested right to the value of his Matching Contribution Account upon the occurrence of any of the following events prior to his Severance from Employment: (1) Normal Retirement Age, (2) Disability, (3) death, or (4) in accordance with Section 12.4. 6.3 Forfeiture of Non-vested Interest Upon a Participant's Severance from Employment, the non-vested portion of a Participant's Matching Contribution Account shall be forfeited at the earlier of the date he receives a distribution of the vested portion of his Account or the date he incurs five (5) consecutive One-Year Breaks in Service. For purposes of this Article VI, a One-Year Break in Service means a twelve (12) consecutive month period beginning on an Employee's Severance Date or an anniversary thereof and ending on the first anniversary of such date during which the Participant does not receive credit for an Hour of Service. The Administrator shall apply all forfeitures by first restoring the amount of previous forfeitures, in accordance with Section 6.4(b) or (c), then by reducing the amount of Employer contributions required under the Plan for the then current Plan Year and allocating such forfeitures in a manner consistent with Section 3.2, and, finally, by paying reasonable administrative expenses to the extent not paid by the Employer. 6.4 Restoration of Forfeitures and Service (a) If a former Participant whose Severance from Employment resulted in a forfeiture of the entire non-vested portion of his Account pursuant to Section 6.3 resumes participation in the Plan after at least five (5) consecutive One-Year Breaks in Service, with respect to Matching Contributions, he shall have Ingram Micro Inc. Article VI-2 401(k) Investment Savings Plan
no right to restoration of any previously forfeited portion of his Account. Such Participant's Years of Service or period of employment after the break in service or period of absence shall not be taken into account in determining the Participant's vested nonforfeitable right to the value of his Matching Contribution Account attributable to contributions made by the Employer before he resumed participation in the Plan. (b) If a former Participant (1) whose Severance from Employment resulted in a forfeiture of the entire non-vested portion of his Account pursuant to Section 6.3 did not receive a distribution pursuant to Section 8.3 and resumes employment as an Eligible Employee or (2) whose Severance from Employment resulted in a forfeiture of the entire non-vested portion of his Account pursuant to Section 6.3 resumes employment as an Eligible Employee, in either case prior to incurring five (5) consecutive One-Year Breaks in Service, the previously forfeited portion of his Account shall be restored upon his Reemployment Commencement Date. Such Participant's Years of Service or period of employment before and after the break in service shall be taken into account in determining the Participant's vested nonforfeitable right to the value of his Matching Contribution Account. (c) If a former Participant whose Severance from Employment resulted in a forfeiture of the entire non-vested portion of his Account pursuant to Section 6.3 received a distribution pursuant to Section 8.3 and resumes employment as an Eligible Employee prior to incurring five (5) consecutive One-Year Breaks in Service, the previously forfeited portion of his Account shall be restored upon the date on which the Participant repays in cash to the Plan the full amount of the distribution, in accordance with applicable administrative procedures. Such repayment must be made prior to the earlier of (i) the end of the five (5) year period commencing on the Participant's Reemployment Commencement Date or (ii) the close of the first period of five consecutive Ingram Micro Inc. Article VI-3 401(k) Investment Savings Plan
One-Year Breaks in Service. Such Participant's Years of Service before and after the Break in Service shall be taken into account in determining the Participant's vested nonforfeitable right to the value of his Matching Contribution Account. Ingram Micro Inc. Article VI-4 401(k) Investment Savings Plan
ARTICLE VII WITHDRAWALS AND LOANS DURING EMPLOYMENT 7.1 General Rules Applicable to all In-Service Withdrawals The only in-service withdrawals permitted by the Plan are those described in this Article VII. Each in-service withdrawal request must be filed in accordance with applicable administrative procedures. Each withdrawal shall be determined as of the Valuation Date as soon as practicable after the withdrawal request is approved and shall be drawn, to the extent available, pro rata from the Investment Funds in which the Account is invested or in which the Accounts are invested if the withdrawal is taken from multiple Accounts. Only a Participant who has not incurred a Severance from Employment may request an in-service withdrawal. 7.2 Rollover Contribution Account and After-Tax Contribution Account Withdrawals A Participant may, in accordance with applicable administrative procedures, request a withdrawal of all or any portion of his Rollover Contribution Account and/or his After-Tax Contribution Account at any time. The Participant may make only two withdrawals from his After-Tax Contribution Account and two withdrawals from his Rollover Contribution Account in any Plan Year. 7.3 Age 59 1/2 Withdrawals A Participant who has attained age 59 1/2 may, in accordance with applicable administrative procedures, request a withdrawal of all or any portion of his Ingram Micro Inc. Article VII-1 401(k) Investment Savings Plan
vested Account each quarter. A withdrawal pursuant to this Section 7.3 shall not affect the Participant's continued participation in the Plan. 7.4 Hardship Withdrawals (a) A Participant who has suffered a Hardship may request a withdrawal of all or any portion of the value of his Before-Tax Contribution Account (excluding all earnings comprising part of such Account that were credited after 1988), his Catch-Up Contribution Account and his vested Matching Contribution Account. For purposes of this Section 7.4, Hardship means an immediate and heavy financial need, as determined by the Administrator on a uniform and nondiscriminatory basis, that arises on account of (a) expenses for (or necessary to obtain) medical care that would be deductible under Section 213(d) of the Code (determined without regard to whether the expenses exceed 7.5% of adjusted gross income), (b) the purchase (excluding mortgage payments) of a principal residence for the Participant, (c) tuition expenses for the next twelve (12) month period of post-secondary education for the Participant, his Spouse, or any dependents of the Participant (as defined in Section 152 of the Code but without regard to Section 152(d)(1)(B) of the Code)), (d) the need to prevent the eviction of the Participant from his principal residence or foreclosure on the mortgage of the Participant's principal residence, (e) any other immediate and heavy financial need that the Administrator, in its sole discretion, determines qualifies as a Hardship, and effective for Hardships incurred on or after January 1, 2006, (f) burial or funeral expenses for the Participant's deceased parent, spouse, children or dependents (as defined in Section 152 of the Code but without regard to Section 152(d)(1)(B) of the Code), or (g) the repair of damage to the Participant's principal residence that would qualify for the casualty deduction under Section 165 of the Code (determined without regard to whether the loss exceeds 10% of adjusted gross income). A Participant may make two Hardship withdrawals in each calendar year. Ingram Micro Inc. Article VII-2 401(k) Investment Savings Plan
(b) Before requesting a withdrawal pursuant to this Section 7.4, a Participant must first obtain all distributions, other than hardship distributions, and all nontaxable loans currently available to him under all qualified plans maintained by the Employer. (c) The amount of any Hardship withdrawal shall not exceed the amount required to meet the immediate and heavy financial need created by the hardship, including the amount necessary to pay any income taxes and related penalties resulting from the distribution. The determination of the existence of the financial need and the amount necessary to meet that need shall be made by the Administrator in accordance with objective standards on a uniform and nondiscriminatory basis. (d) A Participant who obtains a Hardship withdrawal pursuant to this Section 7.4 shall be prohibited from making Before-Tax, After-Tax and Catch-Up Contributions to the Plan and to all other plans maintained by the Employer for six (6) months from the date of the withdrawal. (e) Any Hardship withdrawal made pursuant to this Section 7.4 shall be taken to the extent available, prorata from the Investment Funds in which the following are invested in this order: vested Matching Contribution Account, Before-Tax Contribution Account and Catch-up Contribution Account. All Hardship withdrawal payments shall be made in a lump sum in cash as soon as practicable after the Administrator makes its determination. 7.5 Loans to Participants (a) Loans The Administrator or its delegate may, in accordance with a uniform and nondiscriminatory policy, direct the Trustee to loan a Participant amounts from Ingram Micro Inc. Article VII-3 401(k) Investment Savings Plan
the vested portion of his Accounts. All loans shall be in accordance with the terms, conditions, requirements and limitations specified in this Section 7.5 and any separate written document adopted by the Administrator and forming part of the Plan. It is intended that all loans made to Participants under this Section 7.5 shall meet the requirements of Section 72(p) of the Code. (b) Loan Administration The loan provision of the Plan shall be administered on a uniform and nondiscriminatory basis in accordance with terms and conditions established by the Administrator. The Administrator is authorized to delegate to the Trustee the authority to review loan requests, execute loan agreements and collect loan payments. In administering the loan provisions of this Section 7.5, the Administrator or its delegate shall: (1) adopt such rules and regulations as it deems necessary for the proper and efficient administration of loans, including, but not limited to, appropriate adjustments in the accounting provisions of the Plan as it deems necessary and advisable to facilitate and account for loans; (2) establish standards that shall be used to determine if a loan request should be approved; (3) determine how the interest rate to be charged on outstanding loans is to be calculated and when the rate to be charged for new loans is to be changed; (4) determine, from time to time, the minimum loan amount; Ingram Micro Inc. Article VII-4 401(k) Investment Savings Plan
(5) employ agents, attorneys, accountants, and other persons to administer the loan provision and to collect outstanding loans; and (6) take all other actions necessary or advisable to carry out the provisions of this Section 7.5. (c) Loan Eligibility Any Participant who is either (1) an Employee paid on the payroll system of the Employer or (2) a former Employee who is a party in interest as defined in Section 3(14) of ERISA with respect to the Plan may request a loan subject to the terms, conditions and limitations prescribed in this Section 7.5. (d) Loan Request Each loan request must be made in accordance with procedures prescribed by the Administrator. (e) Term of Loan and Payment Each loan shall be evidenced by a legally enforceable agreement in a form approved by the Administrator and shall provide for payment of principal and interest based on substantially level amortization payments. All loans shall be subject to a specific repayment schedule with payments to be made not less frequently than quarterly over the term of the loan. The period of repayment for any home loan within the meaning of Section 72(p)(2)(B)(ii) shall not exceed one hundred and twenty (120) months. The period of repayment for all other loans shall in no event exceed sixty (60) months. A loan to a Participant shall be secured by the Participant's Account. Except in the case of Participants described in Section 7.5(c)(2), loan payments shall Ingram Micro Inc. Article VII-5 401(k) Investment Savings Plan
be required to be made through payroll deductions, and each Participant shall be required to execute an irrevocable authorization directing the Employer to deduct the loan payments from the Participant's wages or salary, which amounts shall be transmitted to the Trustee and applied against the outstanding loan balance. Participants may prepay the entire amount of the remaining unpaid principal balance (and all remaining interest due thereon) at any time without penalty. Loan payments in the case of Participants described in Section 7.5(c)(2) shall be made in a manner approved by the Administrator. (f) Maximum Loan Loans to a Participant (when added to the outstanding balance of all other loans from the Plan and any other qualified plan maintained by the Employer) shall not be in an amount that exceeds the lesser of: (1) $50,000, reduced by the excess (if any) of the highest outstanding balance of loans from the Plan during the one (1) year period ending on the day before the date on which such loan is made, over the outstanding balance of other loans from the Plan on the date the new loan is made, or (2) fifty percent (50%) of the vested portion of the Participant's Account reduced by the then outstanding balance of any other loans that the Participant received from the Plan. (g) Interest Each loan shall bear interest at a rate to be fixed by the Administrator and, in determining the interest rate, the Administrator shall take into consideration interest rates currently being charged by commercial lending institutions. Ingram Micro Inc. Article VII-6 401(k) Investment Savings Plan
Interest rates shall be fixed for the terms of the loan at the time the loan is made, and the Administrator shall determine periodically the interest rate to be charged on new loans. (h) Failure to Repay Loans The Administrator shall establish uniform rules to apply where a Participant fails to repay any portion of a loan made to him and accrued interest thereon in accordance with the terms of the loan, or where any portion of a loan and accrued interest thereon remains unpaid on a Participant's Severance from Employment. Such rules shall not be inconsistent with Section 72(p) of the Code and Regulations thereunder. Loan repayments with respect to qualified military service will be suspended as permitted under Section 414(u)(4) of the Code. Notwithstanding the foregoing provisions of this Section 7.5(h), if a Participant loan remains unpaid at the time that a distribution is due the Participant (or his Beneficiary) under the Plan, the Administrator shall reduce the amount otherwise distributable to the Participant or Beneficiary by the unpaid balance of principal and accrued interest on the Participant's loan and distribute (in kind) the promissory note or other agreement evidencing such loan in full or partial satisfaction of the obligation to distribute the Participant's vested Account. The requirement that loan repayments be made on an amortized basis, not less frequently than quarterly, may be suspended for up to one year while a Participant is on a leave of absence approved by the Employer, either without pay or at a rate of pay (after income and employment tax withholding) that is less than the amount of the installment payments required under the terms of the Participant loan. A suspension of regularly scheduled loan payments shall not in any event extend the due date of the Ingram Micro Inc. Article VII-7 401(k) Investment Savings Plan
Participant loan beyond the due date in effect immediately prior to the leave of absence (or an accelerated due date in the case of the Participant's termination of employment) and the installments due after the leave of absence ends (or, if earlier, after the first year of the leave of absence) must not be less than the installments required under the terms of the original loan. A default in repayment of a Participant loan shall occur when a Participant fails to make any payment when due under the terms of a Participant loan. Notwithstanding the above, the Administrator may establish a grace period, during which Participants may make past due payments without incurring a default. If a grace period is established, it shall in no event continue beyond the last day of the calendar quarter following the calendar quarter in which the required payment was initially due from the Participant. Such grace period, if any, shall be applied in a uniform and nondiscriminatory manner, taking into account commercially reasonable factors concerning whether (or to what extent) a grace period should be allowed based on all of the facts and circumstances of the particular case. Upon the occurrence of a default, as described above, there shall be a deemed distribution to the Participant equal to the entire outstanding balance of the Participant loan at the time of such default. (i) Directed Investment Any loan to a Participant under this Section 7.5 shall be made pro rata from the Investment Funds in which the Participant's individual Account is invested, shall be charged against said Account and shall be treated as a segregated investment of the Participant's Account. Any loan to a Participant who is subject to Rule 16b-3 of the Securities and Exchange Commission or who is designated by the Employer as a window group person shall be made pro-rata from the Investment Funds in which the Participant's individual Account is Ingram Micro Inc. Article VII-8 401(k) Investment Savings Plan
invested other than the Ingram Micro Stock Fund. Any principal and interest paid on the loan shall be paid in accordance with the Participant's investment elections in effect at the time of the loan repayment. Loan repayments shall be applied first to satisfy accrued loan interest and the remainder shall be applied to principal. If and to the extent required by the Sarbanes-Oxley Act or other applicable law, loans shall not be made to officers of the Employer or other prohibited classifications of Participants. Ingram Micro Inc. Article VII-9 401(k) Investment Savings Plan
ARTICLE VIII DISTRIBUTIONS UPON SEVERANCE FROM EMPLOYMENT 8.1 Eligibility for Distribution A Participant's vested Account balance shall become payable upon Severance from Employment for any reason including death or Disability. 8.2 Forms of Payment Benefits shall be payable in a single lump sum payment. The Participant or Beneficiary may elect to receive distributions from the Ingram Micro Stock Fund in cash or in kind. Fractional shares must be settled in cash. 8.3 Timing of Payment Benefits that become payable in accordance with Section 8.1 shall be distributed as soon as administratively feasible after the Participant or the Beneficiary, as the case may be, elects, in accordance with procedures established by the Administrator, to receive a distribution. If the vested value of the Participant's Account is more than $5,000 at the time benefits become distributable in accordance with Section 8.1, the Participant must consent to the distribution. Such consent must be obtained within the ninety (90) day period ending on the date the Participant elects to receive a distribution. If the vested value of the Participant's Account is $5,000 or less at the time benefits become distributable in accordance with Section 8.1, the Participant or Beneficiary, as the case may be, shall be required to receive a distribution as soon as administratively practicable of the balance payable in a single lump sum payment. Effective for benefits that become payable on or after March 28, 2005, if the vested value of the Participant's Account is $5,000 or Ingram Micro Inc. Article VIII-1 401(k) Investment Savings Plan
less but greater than $1,000 at the time benefits become distributable in accordance with Section 8.1 and the Participant does not elect to have such distribution paid in the manner described in Section 8.2 or 8.7, the Employer will pay the distribution in a direct rollover to an individual retirement plan designated by the Employer. The vested value of the Participant's Account for this purpose shall be determined with regard to that portion of the Account that is attributable to Rollover Contributions (and earnings allocable thereto) within the meaning of Sections 402(c), 403(a)(4), 403(b)(8), and 457(e)(16) of the Code. 8.4 Minimum Distribution Requirements The requirements of this Section 8.4 shall take precedence over any inconsistent provisions of the Plan. All distributions required under this Section 8.4 shall be determined and made in accordance with the Regulations under Section 401(a)(9) of the Code. (a) Time and Manner of Distribution (1) The Participant's entire interest will be distributed, or begin to be distributed, to the Participant no later than the Participant's 'Required Beginning Date'. The Required Beginning Date, for purposes of this Section 8.4, means April 1st of the calendar year following the later of (i) the calendar year in which the Participant attains age 70 1/2, or (ii) the calendar year in which the Participant retires. A Participant who is a five percent (5%) owner as defined in Section 416 of the Code with respect to the Plan Year ending in the calendar year in which the Participant attains age 70 1/2 shall have his Required Beginning Date determined pursuant to (i) above. Ingram Micro Inc. Article VIII-2 401(k) Investment Savings Plan
(2) If the Participant dies before distributions begin, the Participant's entire interest will be distributed in a single lump sum payment no later than December 31st of the calendar year containing the fifth anniversary of the Participant's death. (b) Required Minimum Distributions During Participant's Lifetime (1) During the Participant's lifetime, the minimum amount that will be distributed for each distribution calendar year is the lesser of: (i) the quotient obtained by dividing the Participant's account balance (as defined below in Section 8.4(d)(3)) by the distribution period in the Uniform Lifetime Table set forth in Section 1.401(a)(9)-9 of the Regulations, using the Participant's age as of the Participant's birthday in the distribution calendar year; or (ii) if the Participant's sole designated beneficiary for the distribution calendar year is the Participant's Spouse, the quotient obtained by dividing the Participant's account balance by the number in the Joint and Last Survivor Table set forth in Section 1.401(a)(9)-9 of the Regulations, using the Participant's and Spouse's attained ages as of the Participant's and Spouse's birthdays in the distribution calendar year. (2) Required minimum distributions will be determined under this Section 8.4(b) beginning with the first distribution calendar year and up to and including the distribution calendar year that includes the Participant's date of death. Ingram Micro Inc. Article VIII-3 401(k) Investment Savings Plan
(c) Required Minimum Distributions After Participant's Death (1) If the Participant dies on or after the date distributions begin, the Participant's entire remaining interest will be distributed in a single lump sum payment no later than December 31st of the calendar year immediately following the calendar year in which the Participant died. (2) If the Participant dies before the date distributions begin, the Participant's entire interest will be distributed in a single lump sum payment no later than December 31st of the calendar year containing the fifth anniversary of the Participant's death. (d) Definitions The following definitions apply for purposes of this Section 8.4: (1) Designated Beneficiary: The individual who is designated as the beneficiary under Section 2.2(b) of the Plan and is the designated beneficiary under Section 401(a)(9) of the Code and Section 1.401 (a)(9)-1, Q&A-4, of the Regulations. (2) Distribution Calendar Year: A calendar year for which a minimum distribution is required. For distributions beginning before the Participant's death, the first distribution calendar year is the calendar year immediately preceding the calendar year which contains the Participant's Required Beginning Date. For distributions beginning after the Participant's death, the first distribution calendar year is the calendar year in which distributions are required to begin under Section 8.4(a)(2). The required minimum distribution for the Participant's first distribution calendar year will be made on or before Ingram Micro Inc. Article VIII-4 401(k) Investment Savings Plan
the Participant's Required Beginning Date. The required minimum distribution for other distribution calendar years, including the required minimum distribution for the distribution calendar year in which the Participant's Required Beginning Date occurs, will be made on or before December 31st of that distribution calendar year. (3) Participant's account balance: The account balance as of the last valuation date in the calendar year immediately preceding the distribution calendar year (valuation calendar year) increased by the amount of any contributions made and allocated or forfeitures allocated to the account balance as of dates in the valuation calendar year after the valuation date and decreased by distributions made in the valuation calendar year after the valuation date. The account balance for the valuation calendar year includes any amounts rolled over or transferred to the plan either in the valuation calendar year or in the distribution calendar year if distributed or transferred in the valuation calendar year. Ingram Micro Inc. Article VIII-5 401(k) Investment Savings Plan
8.5 Special Timing Rules Unless a Participant elects otherwise, his vested Account shall be distributed to him no later than sixty (60) days after the close of the Plan Year in which occurs the latest of his Normal Retirement Age (or age 65, if earlier), the tenth (10th) anniversary of the year in which he commenced participation in the Plan or the date of his Severance from Employment. A Participant must, however, file a claim for benefits before benefits will be distributed to him in accordance with this Section 8.5. The failure of a Participant to consent to a distribution while his benefit is immediately distributable within the meaning of Section 411 (a)(11) of the Code shall be deemed to be an election to defer commencement of payment of any benefit sufficient to satisfy this Section 8.5. 8.6 Proof of Death The Administrator may require and rely upon such proof of death and such evidence of the right of any Beneficiary or other person to receive the value of the Accounts of a deceased Participant as the Administrator may deem proper, and its determination of death and of the right of that Beneficiary or other person to receive payment shall be conclusive. 8.7 Direct Rollovers (a) In General Notwithstanding any provision of the Plan to the contrary that would otherwise limit a Distributee's election under this Section 8.7, a Distributee may elect, at the time and in the manner prescribed by the Administrator, to have any Ingram Micro Inc. Article VIII-6 401(k) Investment Savings Plan
portion of an Eligible Rollover Distribution paid directly to an Eligible Retirement Plan specified by the Distributee in a Direct Rollover. (b) Eligible Rollover Distribution An Eligible Rollover Distribution is any distribution of all or any portion of the balance to the credit of the Distributee, except that an Eligible Rollover Distribution does not include: any distribution that is one of a series of substantially equal periodic payments (no less frequently than annually) made for the life (or life expectancy) of the Distributee or the joint lives (or joint life expectancies) of the Distributee and the Distributee's designated beneficiary, or for a specified period of ten (10) years or more; any distribution to the extent such distribution is required under Section 401(a)(9) of the Code; except as otherwise provided below, the portion of any distribution that is not includible in gross income; and, any hardship distribution described in Section 401 (k)(2)(B)(i)(IV). A portion of a distribution shall not fail to be an Eligible Rollover Distribution merely because the portion consists of after-tax employee contributions which are not includible in gross income. However, such portion may be transferred only to an individual retirement account or annuity described in Section 401 (a) or (b) of the Code, or to a defined contribution plan described in Section 401 (a) or 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution which is includible in gross income and the portion of such distribution which is not includible. (c) Eligible Retirement Plan An Eligible Retirement Plan is an individual retirement account described in Section 408(a) of the Code, an individual retirement annuity described in Section 408(b) of the Code, an annuity plan described in Section 403(a) of the Ingram Micro Inc. Article VIII-7 401(k) Investment Savings Plan
Code, an annuity contract described in Section 403(b) of the Code, an eligible plan under Section 457(b) which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state and which agrees to separately account for amounts transferred into such plan for the Plan or a qualified trust described in Section 401 (a) of the Code, that accepts the Distributee's Eligible Rollover Distribution. (d) Distributee A Distributee includes an Employee or former Employee. In addition, the Employee's or former Employee's surviving Spouse and the Employee's or former Employee's Spouse or former Spouse who is the alternate payee under a qualified domestic relations order, as defined in Section 414(p) of the Code, are Distributees with regard to the interest of the Spouse or former Spouse. (e) Direct Rollover A Direct Rollover is a payment by the Plan to the Eligible Retirement Plan specified by the Distributee. (f) Waiver of Thirty (30) Day Notice If a distribution is not subject to Sections 401(a)(11) and 417 of the Code, the distribution may be made less than thirty (30) days after the notice required by Reg. Sec. 1.411(a)-11(c) is given provided: (1) the Administrator clearly informs the Participant that the Participant has the right to a period of at least thirty (30) days after receiving the notice to consider the decision whether or not to elect a distribution (and, if Ingram Micro Inc. Article VIII-8 401(k) Investment Savings Plan
applicable, a particular distribution option); and (2) the Participant, after receiving the notice, affirmatively, elects to receive a distribution. Ingram Micro Inc. Article VIII-9 401(k) Investment Savings Plan
ARTICLE IX TOP HEAVY PROVISIONS 9.1 When Applicable If the Plan is determined to be "Top Heavy" for any Plan Year, the provisions of this Article shall supersede any conflicting provisions of the Plan. 9.2 Top Heavy Determination (a) The Plan shall be Top Heavy with respect to any Plan Year in which, as of the "Determination Date", the ratio of the present value of accrued benefits under all defined benefit plans in the "Aggregation Group" for "Key Employees" plus all Account balances attributable to Employer and Employee contributions (except as otherwise noted below) under the Plan and all other defined contribution plans in the Aggregation Group, exceeds sixty percent (60%) of such present value of accrued benefits and such Account balances for all Key Employees and Non-Key Employees under all plans in the Aggregation Group. The present values of accrued benefits and the amounts of account balances of an Employee as of the determination date shall be increased by the distributions made with respect to the Employee under the Plan and any plan aggregated with the Plan under Section 416(g)(2) of the Code during the one (1) year period ending on the determination date. The preceding sentence shall also apply to distributions under a terminated plan which, had it not terminated, would have been aggregated with the Plan under Section 416(g)(2)(A)(i) of the Code. In the case of a distribution for a reason other than separation from service, death or disability, this provision shall be applied by substituting a five (5) year period for the one (1) year period. The accrued benefits and accounts of any individual who has not performed services for the Employer during the one (1) year period ending on the determination date Ingram Micro Inc. Article IX-1 401(k) Investment Savings Plan
shall not be taken into account. The accrued benefits and account balances of any individual who is not a Key Employee but who was a Key Employee in a prior year will be disregarded. In any event, the calculation of the Top Heavy ratio and the extent to which distributions, tax deductible qualified employee contributions, rollovers and transfers are taken into account shall be in accordance with Section 416 of the Code and the Regulations thereunder. When aggregating plans, accrued benefits and account balances under other plans will be calculated as of determination dates that are within the same calendar year. (b) In determining the cumulative accrued benefits under a defined benefit plan for purposes of this Section 9.2, the actuarial assumptions specified by the defined benefit plan for this purpose shall be utilized. If differing actuarial assumptions are specified for two or more defined benefit plans, the actuarial assumptions for the defined benefit plan including the largest number of employees in the first year any defined benefit plan is included within the Aggregation Group shall be utilized. Solely for the purpose of determining if the Plan or any other plan in a required aggregation group of which the Plan is a part is a Top Heavy Plan, the accrued benefit of an Employee other than a Key Employee shall be determined (1) under the method, if any, that uniformly applies for accrual purposes under all plans maintained by the Employer, or (2) if there is no such method, as if such benefit accrued not more rapidly than the slowest accrual rate permitted under the fractional accrual rate of Section 411(b)(1)(C) of the Code. (c) The term Top Heavy shall not include a plan which consists solely of (1) a cash or deferred arrangement which meets the requirements of Section 401(k)(12) and (2) matching contributions with respect to which the requirements of Section 401(m)(11) are met. If, but for the foregoing, a plan would be treated as a Top Heavy plan because it is a member of an Ingram Micro Inc. Article IX-2 401(k) Investment Savings Plan
aggregation group which is a Top Heavy group, contributions under the plan may be taken into account in determining whether any other plan in the group meets the requirements of Section 416(c)(2) of the Code. 9.3 Minimum Contribution For each year that the Plan is Top Heavy the Employer shall contribute to the Plan and allocate to the Matching Contribution Account of each Participant who is a Non-Key Employee (including such an individual who is eligible to participate but has not elected to do so in accordance with Article II) an amount that is not less in total than the lesser of three percent (3%) of the Non-Key Employee's Compensation for the Plan Year or the greatest amount (expressed as a percentage of Compensation) allocated to the Account of any Key Employee for that year. Compensation for purposes of this Article IX shall mean compensation within the meaning of Section 415(c)(3) of the Code as defined in Section 3.11. This minimum allocation shall be made even though, under other Plan provisions, the Eligible Employee would not otherwise be entitled to receive an allocation or would have received a lesser allocation for the year because of (a) his failure to be employed on a specified date such as the last day of the Plan Year, (b) his failure to make mandatory contributions, if any, to the Plan, or (c) his Compensation being less than a stated amount. This requirement shall not apply to the extent the Participant is covered under any other plan or plans of the Employer and such Employer has provided that the minimum benefit or minimum allocation requirements applicable to Top Heavy Plans will be satisfied in the other plan or plans. Matching Contributions described in Article III shall be taken into account for purposes of satisfying the minimum allocation requirements of Section 416(c)(2) of the Code and the Plan. Matching Contributions that are used to satisfy the minimum allocation requirements shall be treated as Matching Ingram Micro Inc. Article IX-3 401(k) Investment Savings Plan
Contributions of purposes of the actual contribution percentage test and other requirements of Section 401(m) of the Code. 9.4 Vesting Rules For any Plan Year in which the Plan is Top-Heavy, the vesting provisions of Article VI will continue to apply. 9.5 Dual Plan Special Limitations If a Key Employee participates in both the Plan and a defined benefit plan maintained by the Employer, then for all years that the Plan and the defined benefit plan are Top Heavy and the Top Heavy ratio referred to in Section 9.6(b) does not exceed ninety percent (90%), the minimum benefit described in Section 416(h)(2)(A) of the Code shall be provided under the defined benefit plan for each Non-Key Employee. 9.6 Aggregation Groups (a) A Required Aggregation Group is defined as (1) each qualified plan of the Employer in which at least one Key Employee participates or participated during the Determination Period (regardless of whether the plan has terminated) and (2) any other qualified plan of the Employer which enables a plan described in (1)to meet the requirements of Section 401(a)(4) or 410(b) of the Code. The Determination Period, for this purpose, is the Plan Year containing the Determination Date or any of the four preceding Plan Years. A Permissive Aggregation Group is defined as a Required Aggregation Group plus any other plan or plans of the Employer which, when considered as a group with the Required Aggregation Group, would continue to satisfy the requirements of Section 401(a)(4) and 410(b) of the Code. Ingram Micro inc. Article IX-4 401(k) Investment Savings Plan
(b) Each plan of the Employer required to be included in an Aggregation Group shall be treated as a Top Heavy Plan if such group is a Top Heavy group. A required aggregation will be considered a Top Heavy group if the present value of the cumulative accrued benefits for Key Employees under all defined benefit plans included in such group and the aggregate of the accounts of Key Employees under all defined contribution plans included in such group exceed sixty percent (60%) of a similar sum determined for all Employees. 9.7 Key Employee Defined (a) A Key Employee means any Employee or former Employee (including any deceased Employee) who at any time during the Plan Year that includes the determination date was an officer of the Employer having annual Compensation greater than $130,000 (as adjusted under Section 416(i)(1) of the Code for Plan Years beginning after December 31, 2002), a five percent (5%) owner of the Employer, or a one percent (1%) owner of the Employer having annual compensation of more than $150,000. For this purpose, annual Compensation means compensation within the meaning of Section 415(c)(3) of the Code. The determination of who is a Key Employee will be made in accordance with Section 416(i)(1) of the Code and the applicable Regulations of general applicability issued thereunder. (b) A Non-Key Employee is an Employee who is not a Key Employee. 9.8 Determination Date Determination Date means with respect to the initial Plan Year, the last day of the first Plan Year and, for each other Plan Year, the last day of the preceding Plan Year. Ingram Micro Inc. Article IX-5 401(k) Investment Savings Plan
ARTICLE X ADMINISTRATION OF PLAN 10.1 Records and Notices The Administrator shall keep a record of all its proceedings and acts with respect to its administration of the Plan and shall maintain all such books of accounts, records and other data as may be necessary for the proper administration of the Plan. The Administrator shall have the discretionary authority to interpret the provisions of the Plan and Trust Agreement. The Administrator shall notify the Trustees of any action taken by the Administrator affecting the Trustees and its obligations or rights regarding the Plan and, when required, shall notify any other interested person or persons. 10.2 Powers and Duties The Administrator has the following powers and duties: (a) To determine the rights of eligibility of an Employee to participate in the Plan, the value of a Participant's Account and the nonforfeitable percentage of each Participant's Account; (b) To adopt rules of procedure and regulations necessary for the proper and efficient administration of the Plan provided the rules are not inconsistent with the terms of the Plan; (c) To construe and enforce the terms of the Plan and the rules and regulations it adopts, including interpretation of the Plan documents and documents related to the Plan's operation; Ingram Micro Inc. Article X-1 401(k) Investment Savings Plan
(d) To direct the Trustee as respects the crediting and distribution of the Trust Fund; (e) To review and render decisions respecting a claim for (or denial of a claim for) a benefit under the Plan; (f) To furnish the Employer with information which the Employer may require for tax or other purposes; (g) To engage the service of agents whom it may deem advisable to assist it with the performance of its duties; (h) To engage the services of an Investment Manager or Managers, as defined in Section 11.3, each of whom will have power and authority to manage, acquire or dispose (or direct the Trustee with respect to acquisition or disposition) of any Plan asset under its control; (i) To establish, in its sole discretion, a nondiscriminatory policy which the Trustee must observe in making loans, if any, to Participants and Beneficiaries; and (j) To delegate administrative authority to a committee of individuals and to establish rules of procedure for such committee, including rules regarding how such committee is to act, the vote required for action by the committee and other procedures for the operation of the committee as deemed appropriate by the Administrator. All rules, procedures and decisions of the Administrator shall be uniformly and consistently applied to all Participants in similar circumstances. Such rules, procedures and decisions so made shall be conclusive and binding on all Ingram Micro Inc. Article X-2 401(k) Investment Savings Plan
persons having an interest in the Plan. The Administrator shall be a named fiduciary as defined in ERISA Sec. 402(a)(2). The Administrator and any representative that the Administrator chooses to assist it to carry out its responsibilities under the Plan shall have the maximum discretionary authority permitted by the law to interpret, construe and administer the Plan, to make determinations regarding Plan participation, enrollment and eligibility for benefits, to evaluate and determine the validity of benefit claims, and to resolve any and all claims and disputes regarding the rights and entitlements of individuals to participate in the Plan and to receive benefits and payments pursuant to the Plan. The decisions of the Administrator and its representatives shall be given the maximum deference permitted by law. 10.3 Compensation and Expenses The Administrator shall serve without compensation for its services hereunder. All expenses of the Administrator may be paid by the Trust Fund unless paid by the Employer. The Employer shall furnish the Administrator with such clerical and other assistance as is necessary in the performance of its duties and any expense incurred in connection therewith may be paid by the Employer or out of the Trust Fund. The reasonable expenses of administering the Plan may be advanced by the Employer, and then reimbursed to the Employer by the Trust. 10.4 Bonding of Fiduciaries The Administrator shall be responsible for seeing that every fiduciary of the Plan and Trust and every person who handles Trust assets shall be covered by a fidelity bond or similar policy of insurance to the extent required by Ingram Micro Inc. Article X-3 401(k) Investment Savings Plan
Section 412 of ERISA. The cost of such coverage shall be paid by the Trustee out of Trust assets, upon direction of the Administrator, if the cost thereof shall not be timely paid by the Employer. 10.5 Standard of Conduct The Administrator and any other person to whom any fiduciary responsibility with respect to the Plan or Trust is allocated or delegated shall discharge his duties and responsibilities with respect to the Plan or Trust in accordance with the standards set forth in Section 404(a)(1) of ERISA, which provides, subject to the Sections 403(c) and (d), 4042, and 4044 of ERISA, that a fiduciary shall discharge his duties with respect to a plan solely in the interest of the participants and beneficiaries and (a) For the exclusive purpose of (i) providing benefits to participants and their beneficiaries; and (ii) defraying reasonable expenses of administering the plan; (b) With the care, skill, prudence and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims; (c) By diversifying the investments of the plan so as to minimize the risk of large losses, unless under the circumstances it is clearly prudent not to do so; and (d) In accordance with the documents and instruments governing the plan insofar as such documents and instruments are consistent with the provisions of this title. Ingram Micro Inc. Article X-4 401(k) Investment Savings Plan
10.6 Claims Procedure (a) Definitions For purposes of this Section 10.6, the following words or phrases in quotes when capitalized will have the meaning set forth below: (1) "Adverse Benefit Determination" means a denial, reduction or the termination of, or a failure to provide or make payment (in whole or in part) with respect to a Claim for a benefit, including any such denial, reduction, termination, or failure to provide or make payment that is based on a determination of a Participant's or Beneficiary's eligibility to participate in the Plan. (2) "Claim" means a request for a benefit or eligibility to participate in the Plan, made by a Claimant in accordance with the Plan's procedures for filing Claims, as described in this Section 10.6. (3) "Claimant" is defined in Section 10.6(b)(2). (4) "Claims Administrator" means the party designated by the Administrator to review Claims. (5) "Notice" or "Notification" means the delivery or furnishing of information to an individual in a manner that satisfies applicable Department of Labor regulations with respect to material required to be furnished or made available to an individual. (6) "Relevant Documents" include documents, records or other information with respect to a Claim that: Ingram Micro Inc. Article X-5 401(k) Investment Savings Plan
(i) were relied upon by the Claims Administrator in making the benefit determination; (ii) were submitted to, considered by or generated for, the Claims Administrator in the course of making the benefit determination, without regard to whether such documents, records or other information were relied upon by the Claims Administrator in making the benefit determination; (iii) demonstrate compliance with administrative processes and safeguards required in making the benefit determination; or (iv) constitute a statement of policy or guidance with respect to the Plan concerning the denied benefit for the Participant's circumstances, without regard to whether such advice was relied upon by the Claims Administrator in making the benefit determination. (b) Procedure for Filing a Claim In order for a communication from a Claimant to constitute a valid Claim, it must satisfy the following paragraphs (1) and (2) of this paragraph (b). (1) Any Claim submitted by a Claimant must be in writing on the appropriate Claim form (or in such other manner acceptable to the Claims Administrator) and delivered, along with any supporting comments, documents, records and other information, to the Claims Administrator in person, or by mail postage paid, to the address for the Claims Administrator provided in the Summary Ingram Micro Inc. Article X-6 401(k) Investment Savings Plan
Plan Description. (2) Claims and appeals of denied Claims may be pursued by a Participant or an authorized representative of the Participant (each of whom will be referred to in this section as a "Claimant"). However, the Claims Administrator may establish reasonable procedures for determining whether an individual has been authorized to act on behalf of a Participant. (c) Initial Claim Review The initial Claim review will be conducted by the Claims Administrator, with or without the presence of the Claimant, as determined by the Claims Administrator in its discretion. The Claims Administrator will consider the applicable terms and provisions of the Plan and amendments to the Plan, information and evidence that is presented by the Claimant and any other information it deems relevant. In reviewing the Claim, the Claims Administrator will also consider and be consistent with prior determinations of Claims from other Claimants who were similarly situated and which have been processed through the Plan's claims and appeals procedures within the past twenty-four (24) months. (d) Initial Benefit Determination (1) The Claims Administrator will notify the Claimant of the Claim Administrator's determination within a reasonable period of time, but in any event (except as described in paragraph (2) below) within ninety (90) days after receipt of the Claim by the Claims Administrator. (2) The Claims Administrator may extend the period for making the benefit determination by ninety (90) days if it determines that such Ingram Micro Inc. Article X-7 401(k) Investment Savings Plan
an extension is necessary due to matters beyond the control of the Plan and if it notifies the Claimant, prior to the expiration of the initial ninety (90) day period, of circumstances requiring the extension of time and the date by which the Claims Administrator expects to render a decision. (e) Manner and Content of Notification of Adverse Benefit Determination (1) The Claims Administrator will provide a Claimant with written or electronic Notice of any Adverse Benefit Determination, in accordance with applicable Department of Labor regulations. (2) The Notification will set forth in a manner calculated to be understood by the Claimant: (i) The specific reason or reasons for the Adverse Benefit Determination; (ii) Reference to the specific provision(s) of the Plan on which the determination is based; (iii) Description of any additional material or information necessary for the Claimant to perfect the Claim and an explanation of why such material or information is necessary; and Ingram Micro Inc. Article X-8 401(k) Investment Savings Plan
(iv) A description of the Plan's review procedures and the time limits applicable to such procedures, including a statement of the Claimant's right to bring a civil action under Section 502(a) of ERISA following an Adverse Benefit Determination on review. (f) Procedure for Filing a Review of an Adverse Benefit Determination (1) Any appeal of an Adverse Benefit Determination by a Claimant must be brought to the Claims Administrator within sixty (60) days after receipt of the Notice of the Adverse Benefit Determination. Failure to appeal within such sixty (60) day period will be deemed to be a failure to exhaust all administrative remedies under the Plan. The appeal must be in writing utilizing the appropriate form provided by the Claims Administrator (or in such other manner acceptable to the Claims Administrator); provided, however, that if the Claims Administrator does not provide the appropriate form, no particular form is required to be utilized by the Participant. The appeal must be filed with the Claims Administrator at the address listed in the Summary Plan Description. (2) A Claimant will have the opportunity to submit written comments, documents, records and other information relating to the Claim. (g) Review Procedures for Adverse Benefit Determinations (1) The Claims Administrator will provide a review that takes into account all comments, documents, records and other information submitted by the Claimant without regard to whether such information was submitted or considered in the initial benefit determination. Ingram Micro Inc. Article X-9 401(k) Investment Savings Plan
(2) The review procedure may not require more than two levels of appeals of an Adverse Benefit Determination. (h) Timing and Notification of Benefit Determination on Review The Claims Administrator will notify the Claimant within a reasonable period of time, but in any event within sixty (60) days after the Claimant's request for review, unless the Claims Administrator determines that special circumstances require an extension of time for processing the review of the Adverse Benefit Determination. If the Claims Administrator determines that an extension is required, written Notice will be furnished to the Claimant prior to the end of the initial sixty (60) day period indicating the special circumstances requiring an extension of time and the date by which the Claims Administrator expects to render the determination on review, which in any event will be within sixty (60) days from the end of the initial sixty (60) day period. If such an extension is necessary due to a failure of the Claimant to submit the information necessary to decide the Claim, the period in which the Claims Administrator is required to make a decision will be tolled from the date on which the notification is sent to the Claimant until the Claimant adequately responds to the request for additional information. (i) Manner and Content of Notification of Benefit Determination on Review (1) The Claims Administrator will provide a written or electronic Notice of the Plan's benefit determination on review, in accordance with applicable Department of Labor regulations. Ingram Micro Inc. Article X-10 401(k) Investment Savings Plan
(2) The Notification will set forth: (i) The specific reason or reasons for the Adverse Benefit Determination; (ii) Reference to the specific provision(s) of the Plan on which the determination is based; (iii) A statement that the Claimant is entitled to receive, upon request and free of charge, reasonable access to and copies of all Relevant Documents; and (iv) A statement of the Claimant's right to bring a civil action under Section 502(a) of ERISA following an Adverse Benefit Determination of review. (j) Collectively Bargained Benefits (1) Where benefits are provided pursuant to a collective bargaining agreement and such collective bargaining agreement maintains or incorporates by specific reference: (i) provisions concerning the filing of a Claim for a benefit and the initial disposition of a Claim; and (ii) a grievance and arbitration procedure to which Adverse Benefit Determinations are subject, then Section 10.6(c) through and including Section 10.6(i) will not apply to such Claim. Ingram Micro Inc. Article X-11 401(k) Investment Savings Plan
(2) Where benefits are provided pursuant to a collective bargaining agreement and such collective bargaining agreement maintains or incorporates by specific reference a grievance and arbitration procedure to which Adverse Benefit Determinations are subject, then Sections 10.6(f) through and including Section 10.6(i) will not apply to such Claim. (k) Exhaustion of Administrative Remedies The claims procedures set forth in this Section 10.6 shall be strictly adhered to by each Participant or Beneficiary under the Plan and no judicial or arbitration proceedings with respect to any claim for Plan benefits hereunder shall be commenced by any such Participant or Beneficiary until the proceedings set forth herein have been exhausted in full. (l) Statute of Limitations No cause of action may be brought by a claimant who has received an Adverse Benefit Determination later than two (2) years following the date of such Adverse Benefit Determination. Ingram Micro Inc. Article X-12 401(k) Investment Savings Plan
ARTICLE XI MANAGEMENT OF FUNDS 11.1 Appointment of Trustees Subject to the provisions of Section 11.4, the Company shall appoint one or more Trustees to receive and hold in trust all contributions paid into the Trust Fund. Such Trustee or Trustees shall serve at the pleasure of the Board of Directors and shall have such rights, powers and duties as the Board of Directors shall from time to time determine including but not limited to those stated below. 11.2 Investment of Trust Fund by Trustees All contributions made to the Trust Fund pursuant to the Plan shall be paid to the Trustees and, except as herein otherwise provided, shall be held, invested and reinvested by the Trustees without distinction between principal and income in such securities or such other property, real or personal, wherever situated, as the Trustees shall deem advisable, including, but not limited to, shares of stock, common or preferred, whether or not listed on any exchange, participations in mutual investment funds, bonds and mortgages, and other evidences of indebtedness or ownership, or in loans to Participants (consistent with other provisions hereof), and participations in any common trust fund established or maintained by the Trustees for the collective investment of fiduciary funds and shall not be limited by any state statute or judicial decision prescribing or limiting investments appropriate for trustees. The Trustees shall hold and retain all the property and assets of the Trust Fund including income from investments and from all other sources, for the exclusive benefit of the Participants and their Beneficiaries, as provided herein, and for paying the costs and expenses of administering the Plan or Ingram Micro Inc. Article XI-1 401(k) Investment Savings Plan
Trust Fund, to the extent that the same are not paid by any Employer. Reasonable expenses attendant to qualified domestic relations order determinations shall be allocated to the Account of the Participant or Beneficiary seeking the determination. 11.3 Investment of Trust Fund by Investment Manager The Company may enter into one or more agreements for the appointment of one or more Investment Managers to supervise and direct all the investment and reinvestment of a portion or all of the Trust Fund in accordance with the provisions of the Plan in the same manner and with the same powers, duties, obligations, responsibilities and limitations as apply to the Trustees. As a condition to its appointment, an Investment Manager shall acknowledge in writing that it is a fiduciary with respect to the Trust Fund. An Investment Manager so appointed shall be an investment advisor registered under the Investment Advisors Act of 1940, a bank as defined in such Act or an insurance company that is qualified to manage the assets of employee benefit plans pursuant to the laws of more than one state. The Trustees shall be bound by the supervision and direction of the Investment Manager, unless and until the Company amends or revokes the appointment or authority of the Investment Manager. The Company may furnish an Investment Manager with written investment guidelines for investment of the Trust Fund assets, which guidelines may include directions with respect to diversification of the investments. Any Investment Manager shall receive such reasonable compensation chargeable against the Trust Fund or payable by each Employer as shall be agreed upon by the Company. The Company may revoke any agreement with the Investment Manager at any time by thirty (30) days' written notice to the Investment Manager. Any Investment Manager may resign by thirty (30) days' written notice to the Company. Ingram Micro Inc. Article XI-2 401(k) Investment Savings Plan
11.4 Exclusive Benefit Rule Except as otherwise provided in the Plan, no part of the corpus or income of the assets of the Plan shall be used for, or diverted to, purposes other than for the exclusive benefit of Participants and other persons entitled to benefits under the Plan. No person shall have any interest in or right to any part of the earnings of the assets of the Plan, or any right in, or to, any part of the assets held under the Plan, except as and to the extent expressly provided in the Plan. Ingram Micro Inc. Article XI-3 401(k) Investment Savings Plan
ARTICLE XII AMENDMENT, MERGER, TERMINATION OF PLAN 12.1 Amendment of Plan Subject to the provisions of Section 11.4, the Company (for the Company and for all other Employers) shall have the right at any time to amend the Plan, and retroactively if deemed necessary or appropriate, except that no such amendment shall make it possible for any part of the assets of the Plan to be used for, or diverted to, purposes other than for the exclusive benefit of persons entitled to benefits under the Plan. No amendment shall be made which has the effect of decreasing the balance of the Accounts of any Participant or of reducing the nonforfeitable percentage computed under the Plan as in effect on the date on which the amendment is adopted or, if later, the date on which the amendment becomes effective. If the Plan's vesting schedule is amended, or the Plan is amended in any way that directly or indirectly affects the computation of the Participant's nonforfeitable percentage or if the Plan is deemed amended by an automatic change to or from a top-heavy vesting schedule, each Participant with at least three Years of Service with the Employer may elect, within a reasonable period after the adoption of the amendment or change, to have the nonforfeitable percentage computed under the Plan without regard to such amendment or change. The Company reserves the right to amend the Plan, at any time and from time to time, in whole or in part, including without limitation, retroactive amendments necessary or advisable to qualify the Plan and the Trust under the provisions of Section 401(a) of the Code by action of its Board of Directors. Notwithstanding the above, the Plan may be amended to comply Ingram Micro Inc. Article XII-1 401(k) Investment Savings Plan
with technical legal requirements of ERISA or the Code or for any other reason that does not result in a material increase in cost to the Employer by a written instrument that is executed by an officer of the Company or a member or the Plan Committee. Such amendments shall be as set forth in an instrument in writing executed by an offer of the Company if adopted by the Company, or by a designated member of the Plan committee if adopted by the Plan committee. Any amendment may be current, retroactive or prospective, in each case as provided therein. 12.2 Merger or Consolidation The Plan may not be merged or consolidated with, and its assets or liabilities may not be transferred to, any other plan unless each person entitled to benefits under the Plan would, if the resulting plan were then terminated, receive a benefit immediately after the merger, consolidation, or transfer which is equal to or greater than the benefit he would have been entitled to receive immediately before the merger, consolidation, or transfer if the Plan had then terminated. 12.3 Additional Participating Employers (a) If any company is or becomes a subsidiary of or associated with the Company, the Company may include any employees of that subsidiary or associated company in the participation of the Plan upon appropriate action by that company necessary to adopt the Plan. In that event, or if any persons become Employees of an Employer as the result of merger or consolidation or acquisition of all or part of the assets or business of another company or for purposes of a specific assignment at a specific location, the Company shall Ingram Micro Inc. Article XII-2 401(k) Investment Savings Plan
determine to what extent, if any, previous service with the subsidiary, associated or other company or at the specific location shall be recognized under the Plan, but subject to the continued qualification and tax-exempt status of the Plan and trust, respectively, under the Code. (b) Any Employer may terminate its participation in and withdraw from the Plan upon appropriate action by its board of directors. In that event, the assets of the Plan held on account of Participants in the employ of that Employer, and any unpaid balances of the Accounts of all Participants who have separated from the employ of that Employer, shall be determined by the Administrator. Those funds shall be distributed as provided in Section 12.4 if the Plan should be terminated with respect to the Employer, or shall be segregated by the Trustee as a separate trust, pursuant to certification to the Trustee by the Administrator, continuing the Plan as a separate plan for the Employees of that Employer under which the board of directors of that Employer shall succeed to all the powers and duties of the Company, including the appointment of an administrator for such separate plan. 12.4 Termination of Plan (a) The Board of Directors may terminate the Plan or completely discontinue contributions under the Plan for any reason at any time. In the case of the termination or partial termination of the Plan, or of the complete discontinuance of Employer contributions to the Plan, affected Participants shall be one hundred percent (100%) vested in and have a nonforfeitable right to the total amount in all of their Accounts under the Plan as of the date of the termination or discontinuance. The total amount in each Participant's Account shall be distributed, as the Administrator shall direct, to him or for his benefit or continued in trust for his benefit. Ingram Micro Inc. Article XII-3 401(k) Investment Savings Plan
(b) The Plan will be deemed terminated (1) if and when the Company is judicially declared bankrupt or executes a general assignment to or for the benefit of its creditors, (2) if and when the Company is a party to a merger in which it is not the surviving organization unless the surviving organization adopts the Plan within sixty (60) days after the merger, or (3) upon dissolution of the Company. Ingram Micro Inc. Article XII-4 401(k) Investment Savings Plan
ARTICLE XIII MISCELLANEOUS PROVISIONS 13.1 Limitation of Liability Neither the Company, any Employer, the Administrator, nor any of their respective directors, officers and employees, shall incur any liability for any act or failure to act unless such act or failure to act constitutes willful misconduct or gross negligence in relation to the Plan or the Trust Fund. 13.2 Indemnification The Employer indemnifies and saves harmless the Administrator from and against any and all loss resulting from liability to which the Administrator may be subjected by reason of any act or conduct (except willful misconduct or gross negligence) in the Administrator's official capacity in the administration of the Plan, the Trust Fund or both, including all expenses reasonably incurred in the Administrator's defense, in case the Employer fails to provide such defense. The indemnification provisions of this Section 13.2 do not relieve the Administrator from any liability under ERISA for breach of a fiduciary duty. Furthermore, the Administrator and the Employer may execute a letter agreement further delineating the indemnification agreement of this Section 13.2, provided the letter agreement is consistent with and does not violate ERISA. The indemnification provisions of this Section 13.2 extend to the Trustee solely to the extent provided by a letter agreement executed by the Trustee and the Employer. The Plan may purchase insurance for its fiduciaries or for itself to cover liability or losses occurring by reason of the act or omission of a fiduciary, if such insurance permits recourse by the insurer against the fiduciary in the Ingram Micro Inc. Article XIII-1 401(k) Investment Savings Plan
case of a breach of a fiduciary obligation by such fiduciary. A fiduciary may purchase insurance to cover liability under ERISA from and for his own account. An Employer or an employee organization may purchase insurance to cover potential liability of one or more persons who serve in a fiduciary capacity with regard to the Plan. 13.3 Compliance with ERISA Anything herein to the contrary notwithstanding, nothing above or any other provision contained elsewhere in the Plan shall relieve a fiduciary or other person of any responsibility or liability for any responsibility, obligation or duty imposed upon him pursuant to Title I, Part 4 of ERISA. Furthermore, anything in the Plan to the contrary notwithstanding, if any provision of the Plan is voided by Sections 410 and 411 of ERISA, such provision shall be of no force and effect only to the extent that it is voided by such Section. 13.4 Nonalienation of Benefits (a) None of the payments, benefits or rights of any Participant shall be subject to any claim of any creditor of such Participant and, in particular, shall be free from attachment, garnishment, trustee's process, or any other legal or equitable process available to any creditor of such Participant. No Participant shall have the right to alienate, commute, pledge, encumber or assign any of the benefits or payments which he or she may expect to receive, contingently or otherwise, under the Plan, except the right to designate a Beneficiary or Beneficiaries as hereinbefore provided. (b) Section 13.4(a) also shall apply to the creation, assignment or recognition of a right to any benefit payable with respect to a Participant pursuant to a domestic relations order, unless such order is a qualified domestic Ingram Micro Inc. Article XIII-2 401(k) Investment Savings Plan
relations order as defined in Section 414(p) of the Code. Any fees associated with the review, processing and administration of a qualified domestic relations order shall be charged against the Account of the affected Participant and the account of the affected Alternate Payee. The Plan's qualified domestic relations order procedures are set forth in a separate document, which in incorporated herein as if its terms were fully set forth in this document. (c) The Plan may offset against the Account of any Participant, any amount that the Participant is ordered or required to pay under a judgment, order, decree or settlement described in ERISA Section 206(d)(4) and Section 401(a)(13)(C) of the Code. 13.5 Employment Not Guaranteed By Plan Neither the establishment of the Plan nor its amendment nor the granting of a benefit pursuant to the Plan shall be construed as giving any Participant the right to continue as an Employee of an Employer, as limiting the rights of such Employer to dismiss or impose penalties upon the Participant or as modifying in any other way the terms of employment of any Participant. 13.6 Protected Benefits All benefits which are protected by the terms of Section 411(d)(6) of the Code and Section 204(g) of ERISA, which cannot be eliminated without adversely affecting the qualified status of the Plan on and after the Effective Date, will be provided under the Plan to Participants for whom such benefits are protected. Ingram Micro Inc. Article XIII-3 401(k) Investment Savings Plan
13.7 Form of Communication Any election, application, claim, notice or other communication required or permitted to be made by or to a Participant, the Administrator, the Company, or an Employer in writing shall be made in such form as the Administrator, the Company or the Employer, as the case may be, shall prescribe. Such communication shall be effective upon mailing if sent first class, postage prepaid and addressed to the addressee at its principal office, or to the Participant at his last known address, or upon personal delivery, if delivered to an officer of the addressee or to the Participant, as the case may be. Notwithstanding anything in the Plan to the contrary, any notice, form or other communication hereunder shall be made in the manner prescribed by the Administrator in accordance with applicable law, which may include, in appropriate circumstances, communication by telephone or by electronic or other means. 13.8 Facility of Payment If the Participant entitled to receive payments hereunder is unable to care for his affairs because of illness, accident or disability, and a duly qualified guardian or legal representative is appointed for such Participant, the Administrator shall direct the Trustees to pay any amount to which the Participant is entitled to such duly qualified guardian or legal representative upon claim of such guardian or legal representative. If a duly qualified guardian or legal representative is not appointed for such Participant, the Administrator shall direct the Trustees to pay any amount to which the Participant is entitled to such person's Spouse, child, grandchild, parent, brother or sister or to a person deemed by the Administrator to have incurred expense for such person entitled to payment. Any payment made pursuant Ingram Micro Inc. Article XIII-4 401(k) Investment Savings Plan
to this Section 13.8 in good faith shall be a payment for the account of the Participant and shall be a complete discharge from any liability of the Trust Fund or the Trustees therefor. 13.9 Reduction for Overpayment The Administrator will, whenever it determines that a person has received a benefit payment under the Plan in excess of the amount to which the person is entitled under the terms of the Plan, make a reasonable attempt to collect such overpayment from the person. The amount of any overpayment may be set off against further amounts payable to or on account of the person who received the overpayment. 13.10 Unclaimed Benefits If the Administrator cannot ascertain the whereabouts of any person to whom a payment is due under the Plan, and if, after five (5) years from the date such payment is due, a notice of such payment due is mailed to the last known address of such person, as shown on the records of the Employer and within three (3) months after such mailing such person has not made written claim therefor, the Administrator, if it so elects, after receiving advice from counsel to the Plan, may direct that such payment and all remaining payments otherwise due to such person be cancelled on the records of the Plan and the amount thereof applied in any manner permitted by Section 6.3, and upon such cancellation, the Plan and the Trust shall have no further liability therefor except that, in the event such person later notifies the Administrator of his whereabouts and requests the payment or payments due to him, the amount so applied shall be paid to him as provided in Article Ingram Micro Inc. Article XIII-5 401(k) Investment Savings Plan
VIII without adjustment for gains and losses. 13.11 Receipt and Release Subject to the provisions of ERISA and to the extent permitted by ERISA, any final payments or distribution to any Participant, his Beneficiary or his legal representative in accordance with the Plan shall be in full satisfaction of all claims against the Trust, the Trustee, the Administrator, and the Employer. The Trustee, the Employer, the Administrator, or any combination of them may require a Participant, his Beneficiary or his legal representative to execute a receipt and release of all claims under the Plan upon a final payment or distribution or a receipt to the extent of any partial payment or distribution; and the form of any such receipt and release shall be determined by the Trustee, the Employer, the Administrator or any combination of them. 13.12 Reliance on Information Provided to the Plan Notwithstanding anything contained herein to the contrary, if an individual is provided a statement in confirmation of any election or information provided to the Plan by such individual hereunder, the election or information reflected on such confirmation statement will be deemed to be accurate and may be conclusively relied upon for all purposes hereunder unless the individual timely demonstrates to the Administrator, in the form and manner established by the Administrator, that the election or information reflected on the confirmation statement is not what the individual originally delivered to the Administrator. 13.13 Service in More Than One Fiduciary Capacity Ingram Micro Inc. Article XIII-6 401(k) Investment Savings Plan
Any individual, entity or group of persons may serve in more than one fiduciary capacity with respect to the Plan, the Trust Fund or both. 13.14 Binding Effect of Company's Actions Each Employer shall be bound by any and all decisions and actions taken by the Company hereunder. 13.15 Military Service Notwithstanding any other provision of the Plan to the contrary, service credit and contributions with respect to qualified Military Service will be provided in accordance with Section 414(u) of the Code. 13.16 Limitation of Rights All benefits provided hereunder shall be provided solely from the Trust and a person claiming an interest under the Plan shall not have recourse towards satisfaction of his or her benefits from other than the assets of the Trust. Neither the Employer nor the Administrator represents or guarantees that the value of a Participant's Accounts shall at any time equal or exceed the amount previously contributed thereto. Neither the establishment of the Plan and Trust nor any modification thereof, nor the creating of any fund or account, nor the payment of any benefits shall be construed as giving to any Participant or other person any legal or equitable right against the Employer or the Trustee except as provided in the Plan and Trust Agreement. 13.17 Governing Law Except to the extent inconsistent with and preempted by ERISA or other applicable Federal law, the Plan and all matters arising thereunder shall be Ingram Micro Inc. Article XIII-7 401(k) Investment Savings Plan
governed by the laws of the State of California. If any provision of the Plan is susceptible to more than one interpretation, such interpretation shall be given thereto as is consistent with the Plan being a qualified employees' defined contribution plan within the meaning of the Code. IN WITNESS WHEREOF, and as evidence of the adoption of the Plan, the undersigned officer duly authorized has appended his signature this 14 day of December, 2005. Ingram Micro Inc. By: /s/ Matthew A. Sauer --------------------------------- Ingram Micro Inc. Article XIII-8 401(k) Investment Savings Plan
EXHIBIT 10.9 COMPENSATION DEFERRAL AGREEMENT This Compensation Deferral Agreement, dated as of December 30, 2004, is by and between INGRAM MICRO INC., a Delaware corporation (the "Company"), and KEVIN MURAI ("Executive"). 1. DEFERRAL OF BASE SALARY. During and in respect of the period commencing on January 1, 2005 and ending on December 31, 2005 (the "Compensation Period"), Executive elects to defer receipt of 5.0% of the base salary otherwise payable to him (the "Deferred Salary"). The Deferred Salary, with earnings thereon calculated pursuant to Section 4 hereof, shall be paid to Executive as provided in Section 5 hereof. 2. DEFERRAL OF ANNUAL BONUS. Executive elects not to defer any amount otherwise payable to Executive pursuant to the Company's Executive Incentive Award Plan with respect to the Compensation Period. 3. ADJUSTMENT TO DEFERRED SALARY. During the Compensation Period, the amount of Deferred Salary shall be increased by the "Company Match", which is the amount of Executive's base salary which the Company would have contributed to the Ingram Micro 401(k) Investment Savings Plan or the Ingram Micro Supplemental Investment Savings Plan if Executive had elected to contribute at least 5% of his base salary to such plans. The Company Match, with earnings thereon calculated pursuant to Section 4 hereof, shall be paid to Executive as provided in Section 5 hereof. 4. EARNINGS. Subject to Section 6 hereof, the Deferred Salary and Company Match shall be increased or decreased, as the case may be, by the imputed earnings or losses which would have accrued to such amounts had they been deferred pursuant to the Ingram Micro Supplemental Investment Savings Plan from the dates payment or credit would, but for this Agreement, be made, to the most recent date prior to the date of actual payment practicable to permit the calculations of the amount due to be made and payment to be processed ("Earnings"). For purposes of determining Earnings, Executive may choose in the manner designated by the Company from time to time, and in such proportions as he may determine (provided that the allocations shall be in 5% increments), among any or all of the investment options provided by the Ingram Micro Supplemental Investment Savings Plan. 5. PAYMENT OF DEFERRED SALARY. Subject to Section 6 hereof, the Deferred Salary, Company Match and Earnings thereon shall be paid to Executive in accordance with the most recent Executive Deferred Compensation Distribution and Investment Election Form on file with the Company, provided that the date of the said form is at least one year prior the distribution date. The Company shall withhold from such payment all federal, state, city or other taxes as are legally required to be withheld. 6. SOURCE OF PAYMENTS. The obligations of the Company under this Agreement represents an unsecured, unfunded promise to pay benefits to Executive and/or Executive's beneficiaries, and shall not entitle Executive or such beneficiaries to a preferential claim to any asset of the Company. All payments of Deferred Salary, Company match and Earnings shall be paid in cash from the general funds of the Company no special or separate fund shall be established and no other segregation of
assets shall be made to assure the payment of such deferred amounts. Executive shall have no right, title, or interest whatever in or to any investments which the Company may make to aid it in meeting its obligation hereunder. Nothing contained in this Agreement, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind or a fiduciary relationship between the Company and Executive or any other person. To the extent Executive has or acquires any rights to receive payments from the Company, such rights shall be no greater than the right of an unsecured creditor. 7. NEW COMPANY COMPENSATION DEFERRAL PLAN. Notwithstanding Section 4 or 5 hereof, in the event that the Company adopts a plan pursuant to which executives of the Company my elect to defer payment of compensation, the determination of Earnings and the terms and conditions of payment of Deferred Salary and Deferred Bonuses Shall be governed by and subject to the terms and conditions of such plan. 8. GENERAL PROVISIONS. The Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and Executive, his designees, and his estate. Neither Executive, his designees, nor his estate shall commute, pledge, encumber, sell or otherwise dispose of the right to receive the payments provided for in this Agreement, which payments and the rights thereto are expressly declared to be nontransferable and nonassignable. This Agreement shall be governed by the laws of the State of California without reference to principles of conflicts of laws. This Agreement represents the entire agreement between Executive and the Company with respect to the subject matter hereof, and this Agreement may not be amended or modified except by a writing signed by the parties hereto, provided that nothing herein shall affect Executive's rights under, or right to become covered by, any employee benefit program provided by the Company to its executive employees generally. IN WITNESS WHEREOF, the parties have executed this Agreement, to be effective as of the day and year first written above. KEVIN MURAI INGRAM MICRO INC. /s/ Kevin Murai Dec. 30/04 By: /s/ Thomas Berry --------------- ---------- ----------------------------------- Date Title: Sr. Dir. Compensation & Benefits Date: 12-30-04
EXHIBIT 10.10 2006 COMPENSATION DEFERRAL AGREEMENT KEVIN MURAI This Compensation Deferral Agreement, dated as of December 27, 2005, is by and between INGRAM MICRO INC., a Delaware corporation (the "Company"), and KEVIN MURAI ("Executive"). 1. DEFERRAL OF BASE SALARY. During and in respect of the period commencing January 1,2006 and ending on December 31,2006 (the "Compensation Period"), Executive elects to defer receipt of 5.0% of the base salary otherwise payable to him (the "Deferred Salary"). The Deferred Salary, with earnings thereon calculated pursuant to Section 4 hereof, shall be paid to Executive as provided in Section 5 hereof. 2. DEFERRAL OF ANNUAL BONUS. Executive elects not to defer any amount otherwise payable to Executive pursuant to the Company's 2006 Executive Incentive Award Program. 3. ADJUSTMENT TO DEFERRED SALARY. During the Compensation Period, the amount of Deferred Salary shall be increased by the "Company Match", which is the amount of Executive's base salary which the Company would have contributed to the Ingram Micro 401(k) Investment Savings Plan and the Ingram Micro Supplemental Investment Savings Plan if Executive had elected to contribute 5% of his base salary to such plans. The Company Match, with earnings thereon calculated pursuant to Section 4 hereof, shall be paid to Executive as provided in Section 5 hereof. 4. EARNINGS. Subject to Section 6 hereof, the Deferred Salary and Company Match shall be increased or decreased, as the case may be, by the imputed earnings or losses which would have accrued to such amounts had they been deferred pursuant to the Ingram Micro Supplemental Investment Savings Plan from the dates payment or credit would, but for this Agreement, be made, to the most recent date prior to the date of actual payment practicable to permit the calculations of the amount due to be made and payment to be processed ("Earnings"). For purposes of determining Earnings, Executive shall have chosen his investment elections in the manner designated by the Company from time to time, and in such proportions as he may determine (provided that the allocations shall be in 5% increments), among any or all of the investment options provided by the Ingram Micro Supplemental Investment Savings Plan. 5. PAYMENT OF DEFERRED SALARY. Subject Section 6 hereof, the Deferred Salary, Company Match and Earnings thereon shall be paid to Executive in accordance with the most recent Executive Deferred Compensation Distribution Election Form on file with the Company,provided said form has been received and filed in compliance with Section 409A of the Internal Revenue Code. The Company shall withhold from such payments all federal, state, city or other taxes as are legally required to be withheld. 6. SOURCE OF PAYMENTS. The obligations of the Company under this Agreement represents an unsecured, unfunded promise to pay benefits to Executive and/or Executive's beneficiaries, and shall not entitle Executive or such beneficiaries to a preferential claim to any asset of the
Company. All payments of Deferred Salary Continuation shall be paid in cash from the general funds of the Company and no special or separate fund shall be established and no other segregation of assets shall be made to assure the payment of such deferred amounts. Executive shall have no right, title, or interest whatever in or to any investments which the Company may make to aid it in meetings its obligations hereunder. Nothing contained in this Agreement, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind or a fiduciary relationship between the Company and Executive or any other person. To the extent Executive has or acquires any rights to receive payments from the Company, such rights shall be no greater than the right of unsecured creditor. 7. NEW COMPANY COMPENSATION DEFERRAL PLAN. Notwithstanding Section 4 or 5 hereof, in the event the Company adopts a new plan pursuant to which executives of the Company may elect to defer payment of compensation, the determination of Earnings or Company Match and the terms and conditions of payment of Deferred Salary and Deferred Bonuses shall be governed by and subject to the terms and conditions of such plan. 8. GENERAL PROVISIONS. The Agreement shall be binding upon and inure to the benefit of the Company and its successors and assigns, and Executive, his designees, and his estate. Neither Executive, his designees, nor his estate shall commute, pledge, encumber, sell or otherwise dispose of the right to receive the payments provided for in this Agreement, which payments and the rights thereto are expressly declared to be nontransferable and nonassignable. This Agreement shall be governed by the laws of the State of California without reference to principles of conflicts of laws. This Agreement represents the entire agreement between the Executive and the Company with respect to the subject matter hereof, and this Agreement may not be amended or modified except by a writing signed by the parties hereto, provided nothing herein shall affect the Executive's rights under, or right to be covered by, any employee benefit program provided by the Company to its executive employees generally. IN WITNESS WHEREOF, the parties have executed this Agreement, to be effective as of the day and year first written above. EXECUTIVE INGRAM MICRO INC. /s/ Kevin Murai Dec. 27/05 By: /s/ Thomas Berry - ------------------- ------------ ------------------------------- Kevin Murai Date Title: VP. Corp. Compensation & Benefits Date: 12-27-05
EXHIBIT 10.39 INGRAM MICRO INC. SUMMARY OF ANNUAL EXECUTIVE INCENTIVE AWARD PROGRAM Ingram Micro's annual executive incentive award program provides for performance-based bonuses for executives as well as management-level associates and is based on Ingram Micro's performance relative to financial goals. Each executive role has an incentive target that is established as a percent of base salary. For executive officers, this percentage ranges from 45% up to 100%. If a threshold level of profit performance is not met, the incentive award would be zero. The maximum award for executive officers is two times the target award. The Human Resources Committee of the Board of Directors has the ability to make discretionary adjustments to awards under the annual incentive plan, but expects to exercise this discretion only under exceptional circumstances.
Name of Subsidiary | Jurisdiction | |||
1.
|
AVAD LLC | Delaware | ||
2.
|
CD Access Inc. | Iowa | ||
3.
|
IMI Washington Inc. | Delaware | ||
4.
|
Ingram Funding Inc. | Delaware | ||
5.
|
Ingram Micro CLBT Inc. | Delaware | ||
6.
|
Ingram Micro Delaware Inc. | Delaware | ||
7.
|
Ingram Micro CLBT(1) | Pennsylvania | ||
8.
|
Ingram Micro L.P.(2) | Tennessee | ||
9.
|
Ingram Micro Texas L.P.(3) | Texas | ||
10.
|
Ingram Micro Inc. | Ontario, Canada | ||
11.
|
Ingram Micro Holdco Inc. | Ontario, Canada | ||
12.
|
Ingram Micro LP(4) | Ontario, Canada | ||
13.
|
Ingram Micro Logistics LP(5) | Ontario, Canada | ||
14.
|
Ingram Micro Japan Inc. | Delaware | ||
15.
|
Ingram Micro Management Company | California | ||
16.
|
Ingram Micro Singapore Inc. | California | ||
17.
|
Ingram Micro Taiwan Inc. | Delaware | ||
18.
|
Ingram Micro Texas LLC(6) | Delaware | ||
19.
|
Ingram Micro Europe Holding LLC | Delaware | ||
20.
|
Intelligent Express, Inc.(7) | Pennsylvania | ||
21.
|
RND, Inc.(8) | Colorado | ||
22.
|
Computek Enterprises (U.S.A.) Inc.(9) | Florida | ||
23.
|
Ingram Export Company Ltd. | Barbados | ||
24.
|
Ingram Micro de Costa Rica, S. de R.L.(10) | Costa Rica | ||
25.
|
Ingram Micro Compañia de Servicios, S.A. de C.V.(11) | Mexico | ||
26.
|
Ingram Micro Latin America & Caribbean Inc. | Delaware | ||
27.
|
Ingram Micro Latin America | Cayman Islands | ||
28.
|
Ingram Micro Argentina, S.A. | Argentina | ||
29.
|
Ingram Micro Chile, S.A.(12) | Chile | ||
30.
|
Ingram Micro do Brazil Ltda.(13) | Brazil | ||
31.
|
Ingram Micro Tecnologia E Informatica Ltda(14) | Brazil | ||
32.
|
Ingram Micro Peru, S.A.(15) | Peru | ||
33.
|
Ingram Micro Caribbean | Cayman Islands | ||
34.
|
Ingram Micro Logistics Inc.(16) | Cayman Islands | ||
35.
|
CIM Ventures Inc. (17) | Cayman Islands | ||
36.
|
Ingram Micro Mexico, S.A. de C.V.(18) | Mexico | ||
37.
|
Export Services Inc. | California | ||
38.
|
Ingram Micro Panama, S. de R.L.(19) | Panama |
1
Name of Subsidiary | Jurisdiction | |||
39.
|
Ingram Micro SB Holdings Inc. | Cayman Islands | ||
40.
|
Ingram Micro SB Inc. | California | ||
41.
|
Ingram Micro Management Company(20) | USA (California) | ||
42.
|
Ingram Micro Atlantic Holding Inc.(21) | Cayman Islands | ||
43.
|
Ingram Micro North Atlantic Holding Inc.(22) | Cayman Islands | ||
44.
|
Ingram Micro International Inc.(23) | Cayman Islands | ||
45.
|
Ingram Micro Europe Treasury LLC | USA (Delaware) | ||
46.
|
Ingram Micro Luxembourg Sarl | Luxembourg | ||
47.
|
Ingram Micro SAS(24) | France | ||
48.
|
Ingram Micro GmbH | Switzerland | ||
49.
|
Ingram Micro Holding GmbH | Germany | ||
50.
|
Ingram Micro Pan Europe GmbH | Germany | ||
51.
|
Ingram Micro Games GmbH | Germany | ||
52.
|
Ingram Micro Distribution GmbH | Germany | ||
53.
|
Compu-Shack Electronic GmbH | Germany | ||
54.
|
Ingram Micro Europe GmbH(25) | Germany | ||
55.
|
Ingram Macrotron GmbH | Germany | ||
56.
|
Macrotron Systems GmbH | Germany | ||
57.
|
Macrotron Process Technologies GmbH | Germany | ||
58.
|
Macrotron (UK) Ltd.(26) | UK | ||
59.
|
Ingram Micro Europe BVBA(27) | Belgium | ||
60.
|
Ingram Micro BVBA(28) | Belgium | ||
61.
|
Ingram Micro GmbH | Austria | ||
62.
|
Vapriva BVBA(29) | Belgium | ||
63.
|
Handelsmaatschappij voor Computers BVBA | Belgium | ||
64.
|
Ingram Micro Magyarorszag Kft | Hungary | ||
65.
|
Ingram Micro Srl(30) | Italy | ||
66.
|
Ingram Micro BV | Netherlands | ||
67.
|
Bright Creative Communications BV | Netherlands | ||
68.
|
Ingram Micro SL(31) | Spain | ||
69.
|
Ingram Micro Holdings Ltd. | UK | ||
70.
|
Ingram Micro (UK) Ltd. | UK | ||
71.
|
Ingram Micro Finance Centre of Excellence Ltd . | UK | ||
72.
|
Ingram Micro Coordination Center BVBA(32) | Belgium | ||
73.
|
Ingram Micro Nordic Holding BVBA(33) | Belgium | ||
74.
|
Ingram Micro ApS | Denmark | ||
75.
|
Ingram Micro AB | Sweden | ||
76.
|
Ingram Micro AS | Norway | ||
77.
|
Ingram Micro Oy | Finland | ||
78.
|
Ingram Micro (Portugal) Comercio Internacional & Servicos Sociedade Unipessoal LDA | Portugal | ||
79.
|
Ingram Micro Europe AG(34) | Switzerland | ||
80.
|
Ingram Micro Asia Pacific Pte. Ltd | Singapore | ||
81.
|
Ingram Micro New Zealand Holdings | New Zealand |
2
Name of Subsidiary | Jurisdiction | |||
82.
|
Ingram Micro Asia Holdings Inc. | California | ||
83.
|
Ingram Micro Asia Ltd.(35) | Singapore | ||
84.
|
Megawave Pte Ltd.(36) | Singapore | ||
85.
|
Ingram Micro Singapore (Indo-China) Pte Ltd. | Singapore | ||
86.
|
Ingram Micro Singapore (South Asia) Pte Ltd | Singapore | ||
87.
|
Ingram Micro Semiconductors Asia Pte. Ltd. | Singapore | ||
88.
|
ERIM Sdn Bhd(37) | Malaysia | ||
89.
|
Ingram Micro Malaysia Sdn Bhd | Malaysia | ||
90.
|
Ingram Micro Holding (Thailand) Ltd (38) | Thailand | ||
91.
|
Ingram Micro India Private Limited (39) | India | ||
92.
|
Tech Pacific NZ Ltd. | New Zealand | ||
93.
|
Ingram Micro Hong Kong (Holding) Ltd.(40) | Hong Kong | ||
94.
|
Chinam Electronics Limited(41) | Hong Kong | ||
95.
|
Ingram Micro (China) Ltd(42) | Hong Kong | ||
96.
|
Ingram Micro China Commercial Co. Ltd. | China | ||
97.
|
Ingram Micro International Trading (Shanghai) Co., Ltd. | China | ||
98.
|
Ingram Micro (Thailand) Ltd.(43) | Thailand | ||
99.
|
Ingram Micro (Hong Kong) Ltd.(44) | Hong Kong | ||
100.
|
Ingram Micro Holdings (Australia) Pty Ltd. | Australia | ||
101.
|
Ingram Micro Pty Ltd. | Australia | ||
102.
|
Ingram Micro Australia Pty Ltd. | Australia | ||
103.
|
Electronic Resources Australia (Qld) Pty Ltd.(45) | Australia | ||
104.
|
Electronic Resources Australia (Vic) Pty Ltd.(46) | Australia | ||
105.
|
Techpac Holdings (Australia) Pty Ltd.(47) | Australia | ||
106.
|
Tech Pacific Holdings Pty Limited | Australia | ||
107.
|
Tech Pacific Australia Pty Ltd. | Australia | ||
108.
|
Ingram Micro Lanka (Private) Limited(48) | Sri Lanka | ||
109.
|
Techpac Holdings Limited | Bermuda | ||
110.
|
Tech Pacific Holdings Sarl(49) | Luxembourg | ||
111.
|
TP Holdings BVBA 50 | Belgium | ||
112.
|
Tech Pacific Holdings (NZ) Limited | New Zealand | ||
113.
|
Ingram Micro (NZ) Limited | New Zealand | ||
114.
|
Imagineering (NZ) Limited(51) | New Zealand | ||
115.
|
TP Holdings Limited(52) | Bermuda | ||
116.
|
Tech Pacific (Thailand) Co., Ltd. | Thailand | ||
117.
|
Tech Pacific Asia Limited | British Virgin Islands | ||
118.
|
Tech Pacific (H.K.) Limited | Hong Kong | ||
119.
|
Tech Pacific Limited(53) | Hong Kong | ||
120.
|
First Tech Pacific Distributors Sdn Bhd | Malaysia | ||
121.
|
Tech Pacific Inc.(54) | Philippines | ||
122.
|
Tech Pacific (Singapore) Ltd. | Singapore | ||
123.
|
Tech Pacific Logistics Pte Ltd.(55) | Singapore | ||
124.
|
Tech Pacific Holdings Pte Limited | Singapore | ||
125.
|
Tech Pacific Mauritius Limited | Mauritius |
3
Name of Subsidiary | Jurisdiction | |||
126.
|
Techpac Mauritius Limited | Mauritius | ||
127.
|
Surajami Investment & Trading Co. Ltd.(56) | India | ||
128.
|
Tech Pacific (India) Ltd. | India | ||
129.
|
Ingram Micro (India) Exports Pte Ltd. | Singapore |
(1) | Pennsylvania business trust, with Ingram Micro Delaware Inc. as trustee and Ingram Micro CLBT Inc. as beneficiary. |
(2) | Tennessee limited partnership, with Ingram Micro Inc. (Delaware) as general partner and Ingram Micro Delaware Inc. as limited partner. |
(3) | Texas limited partnership, with Ingram Micro Texas LLC (dba IMTX LLC) as general partner and Ingram Micro Delaware Inc. as limited partner. |
(4) | Ingram Micro Holdco is general partner with 0.1% interest and Ingram Micro Inc., an Ontario, Canada corporation is limited partner with 99.9% interest. |
(5) | Ingram Micro Holdco is general partner with 0.1% interest and Ingram Micro Inc., an Ontario, Canada corporation is limited partner with 99.9% interest. |
(6) | Single member limited liability company with Ingram Micro Inc. (Delaware) as its sole member, dba IMTX LLC in Texas. |
(7) | Dormant. |
(8) | Dormant. |
(9) | Dormant. |
(10) | 99.998% owned by Ingram Micro Latin America and .002% owned by Ingram Micro Caribbean. |
(11) | 99.998% owned by Ingram Micro Inc. (Delaware) and .002% owned by Ingram Micro Caribbean. |
(12) | 99% owned by Ingram Micro Latin America Inc. and 1% owned by Ingram Micro Caribbean. |
(13) | 99.999% owned by Ingram Micro Latin America and .001% owned by Ingram Micro Caribbean. |
(14) | 99.999% owned by Ingram Micro Brasil Ltda. and .001% owned by Ingram Micro Latin America. |
(15) | 99.99% owned by Ingram Micro Latin America & Caribbean Inc., .005% owned by Ingram Micro Caribbean and .005% owned by Ingram Micro Inc. (Delaware). |
(16) | 40,000,000 voting preferred shares owned by Ingram Micro Inc. (Delaware) and 10,000,000 non-voting common shares owned by Ingram Micro SB Inc. |
(17) | 346,800 non-voting shares owned by Ingram Micro Logistics Inc. and 55 Class A preferred voting shares owned by Ingram Micro SB Holdings Inc. |
(18) | 99.998% owned by Ingram Micro Inc. (Delaware) and .002% owned by Ingram Micro Caribbean. |
(19) | 99.998% owned by Ingram Micro Latin America and .002% owned by Ingram Micro Caribbean. |
(20) | 6,677.27 shares owned by Ingram Micro Inc., 1,141.05 shares owned by Ingram Micro Europe Holding LLC, and 92.45 shares owned by Ingram Micro Delaware Inc. |
(21) | 4,656.01 shares owned by Ingram Micro Management Company. |
(22) | 3,254.76 shares owned by Ingram Micro Management Company. |
(23) | 4,646.01 shares owned by Ingram Micro Atlantic Holding Inc. and 3,254.76 shares owned by Ingram Micro North Atlantic Holding Inc. |
(24) | One share owned by Ingram Micro International Inc. |
(25) | Ingram Micro Inc. owns 2,935.41 preferred shares. |
(26) | In liquidation. |
(27) | One share owned by Ingram Micro International Inc. |
(28) | One share owned by Ingram Micro International Inc. |
4
(29) | One share owned by Ingram Micro Europe BVBA. |
(30) | One share owned by Ingram Micro Luxembourg Sarl. |
(31) | One share owned by Ingram Micro Luxembourg Sarl. |
(32) | 11,424,521 shares owned by Ingram Micro Luxembourg Sarl. |
(33) | One share owned by Ingram Micro BVBA. |
(34) | In liquidation. |
(35) | Ingram Micro Asia Holdings Inc. owns 99.998% of the issued share capital and 0.002% held by minority shareholders. |
(36) | Dormant. |
(37) | Dormant. |
(38) | 46% of shares owned by Ingram Micro Asia Ltd and 54% of shares are held in trust by nominee shareholders on behalf of Ingram Micro Asia Ltd. |
(39) | 87.6% of shares owned by Ingram Micro Asia Ltd, 12.4% of shares owned by Tech Pacific (India) Ltd and 10 shares held by Ingram Micro Asia Holdings Inc. |
(40) | Dormant. 50% of shares owned by Ingram Micro Asia Ltd and 50% of shares held by nominee shareholder in trust for Ingram Micro Asia Ltd. |
(41) | Dormant. 51% of shares owned by Ingram Micro Hong Kong (Holding) Ltd and 49% of shares owned by Ingram Micro Asia Ltd. |
(42) | 51% of shares owned by Ingram Micro Hong Kong (Holding) Ltd and 49% of shares owned by Ingram Micro Asia Ltd. |
(43) | 99.999% of shares owned by Ingram Micro Inc. and 0.001% held in trust by nominee shareholders on behalf of Ingram Micro Inc. |
(44) | 99% of shares owned by Ingram Micro Asia Holdings Inc. and 1% of shares owned by Ingram Micro Delaware Inc. |
(45) | Dormant. |
(46) | Dormant. 76% of shares owned by Ingram Micro Australia Pty Limited and 24% of shares owned by Ingram Micro Asia Ltd. |
(47) | Ingram Micro Pty Ltd owns 100% of the issued share capital effective March 31, 2005. |
(48) | 99% of shares owned by Ingram Micro Asia Holdings Inc. and 1% of shares owned by Ingram Micro Delaware Inc. |
(49) | In liquidation. |
(50) | In liquidation. |
(51) | Dormant. |
(52) | Dormant. |
(53) | Dormant. |
(54) | Dormant. In liquidation. |
(55) | Dormant. |
(56) | Dormant. 61% of shares owned by Techpac Mauritius Limited and 39% of shares owned by Tech Pacific Mauritius Limited. |
5
/s/ PricewaterhouseCoopers LLP | |
|
|
PricewaterhouseCoopers LLP |
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | |
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
/s/ Gregory M.E. Spierkel | |
|
Title: | Chief Executive Officer |
(Principal Executive Officer) |
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | |
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | |
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | |
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the registrants most recent fiscal quarter (the registrants fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and |
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize and report financial information; and | |
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting. |
/s/ William D. Humes | |
|
|
Name: William D. Humes |
Title: | Executive Vice President and |
Chief Financial Officer | |
(Principal Financial Officer) |
/s/ Gregory M. E. Spierkel | |
|
|
Name: Gregory M. E. Spierkel |
Title: | Chief Executive Officer |
/s/ William D. Humes | |
|
|
Name: William D. Humes |
Title: | Executive Vice President and |
Chief Financial Officer |