As
filed with the Securities and Exchange Commission on October 2, 2006
Registration Nos. 333-129571 and 333-129572
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
POST-EFFECTIVE
AMENDMENT NO. 1 TO
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
PAYCHEX, INC.
(exact name of Registrant as specified in its charter)
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DELAWARE
(State or other jurisdiction
of incorporation or organization)
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16-1124166
(I.R.S. Employer
Identification No.) |
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911 Panorama Trail South
Rochester, New York
(Address of Principal Executive Offices)
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14625-2396
(Zip Code) |
PAYCHEX,
INC. 2002 STOCK INCENTIVE PLAN
(as
amended and restated effective October 12, 2005)
PAYCHEX, INC. NON-QUALIFIED STOCK OPTION AGREEMENT
(Full title of the Plan)
John M. Morphy
Senior Vice President,
Chief Financial Officer and Secretary
Paychex, Inc.
911 Panorama Trail South
Rochester, New York 14625-2396
(585) 385-6666
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copy to:
James M. Jenkins, Esq.
Harter, Secrest & Emery LLP
1600 Bausch & Lomb Place
Rochester, New York 14604-2711
(585) 232-6500
EXPLANATORY NOTE:
In accordance with General Instruction C to Form S-8, this Post-Effective Amendment contains a
Reoffer Prospectus pursuant to Form S-3 that covers reoffers and resales of “control securities”
(as that term is defined in General Instruction C to Form S-8) of Paychex, Inc. (“Paychex” or the
“Company”) common stock, $0.01 par value per share. This Reoffer Prospectus covers the reoffer and
resale of up to 1,083,334 shares of the Company’s common stock that have been or may be issued to
Jonathan J. Judge, the Company’s President and Chief Executive Officer and a Director, upon his
exercise of options granted to him under the Company’s Non-Qualified Stock Option Agreement with
him dated as of October 1, 2004 and under the Company’s
2002 Stock Incentive Plan (as
amended and restated effective October 12, 2005) (the “2002
Plan”), and upon the
vesting of restricted shares granted to him under the 2002 Plan. Pursuant to Rule
429 under the Securities Act of 1933, as amended, the Reoffer Prospectus included herein is a
combined Prospectus that relates to shares of the Company’s common stock heretofore covered by Form
S-8 Registration Statement Numbers 333-129571 and 333-129572, both filed by the Company on November
8, 2005.
REOFFER PROSPECTUS
1,083,334 shares of common stock
PAYCHEX,
INC.
911 Panorama Trail South
Rochester, New York 14625-2396
(585) 385-6666
This prospectus relates to up to 1,083,334 shares of the common stock, $0.01 par value per
share, of Paychex, Inc., a Delaware corporation (“we,”
“our,” or “us”) which may be offered and sold
from time to time by Jonathan J. Judge, our President and Chief Executive Officer and a Director
(also referred to hereinafter as the “Selling Stockholder”) who has acquired or may acquire such
shares pursuant to the exercise of non-qualified stock options that have been granted to him under
our Non-Qualified Stock Option Agreement with him dated as of October 1, 2004 (the “Option
Agreement”), pursuant to the exercise of non-qualified stock options granted to him under our 2002
Stock Incentive Plan (as
amended and restated effective October 12, 2005) (the “2002 Plan”; and together with the Option Agreement, the “Plans”), and
through the vesting of restricted stock granted to him under the 2002 Plan. We will not receive
any of the proceeds from sales of the shares by the Selling Stockholder. The shares may be offered
from time to time by the Selling Stockholder through ordinary brokerage transactions, in negotiated
transactions or in other transactions, at such prices as he may determine, which may relate to
market prices prevailing at the time of sale or be a negotiated price. See “Plan of Distribution.”
All costs, expenses and fees in connection with the registration of the shares will be borne by us.
Brokerage commissions and similar selling expenses, if any, attributable to the offer or sale of
the shares will be borne by the Selling Stockholder. The Selling Stockholder and any broker
executing selling orders on his behalf may be deemed to be an “underwriter” as defined in the
Securities Act of 1933, as amended (the “Securities Act”). If any broker-dealers are used to effect
sales, any commissions paid to broker-dealers and, if broker-dealers purchase any of the shares as
principals, any profits received by such broker-dealers on the resale of the shares, may be deemed
to be underwriting discounts or commissions under the Securities Act. In addition, any profits
realized by the Selling Stockholder may be deemed to be underwriting commissions.
Our common stock is traded on the Nasdaq Global Select Market (the “Nasdaq”) under the symbol
“PAYX.” The last reported sale price for our common stock on the Nasdaq on September 28, 2006 was
$37.29 per share.
INVESTING IN OUR COMMON STOCK INVOLVES CERTAIN RISKS. SEE “RISK FACTORS” BEGINNING ON PAGE 6.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS
APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE ADEQUACY OR ACCURACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this prospectus is October 2, 2006.
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TABLE OF CONTENTS
You should rely only on the information included in or incorporated by reference into this
prospectus or information we refer to in this prospectus. We have not authorized anyone to provide
you with information that is different. This prospectus may only be used where it is legal to sell
these securities. This prospectus is not an offer to sell, or a solicitation of an offer to buy, in
any state where the offer or sale is prohibited. The information in this prospectus is accurate on
the date of this prospectus and may become obsolete later. Neither the delivery of this prospectus,
nor any sale made under this prospectus will, under any circumstances, imply that the information
in this prospectus is correct as of any date after the date of this prospectus.
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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain written and oral statements made by us may constitute “forward-looking statements” as
defined in the Private Securities Litigation Reform Act of 1995 (the “Reform Act”). Forward-looking
statements are identified by such words and phrases as “we expect,” “expected to,” “estimates,”
“estimated,” “current outlook,” “we look forward to,” “would equate to,” “projects,” “projections,”
“projected to be,” “anticipates,” “anticipated,” “we believe,” “could be,” and other similar
phrases. All statements addressing operating performance, events, or developments that we expect or
anticipate will occur in the future, including statements relating to revenue growth, earnings,
earnings-per-share growth, or similar projections, are forward-looking statements within the
meaning of the Reform Act. Because they are forward-looking, they should be evaluated in light of
important risk factors. These risk factors include, but are not limited to, those that are
described in the “Risk Factors” section of this prospectus found at page 6.
PROSPECTUS SUMMARY
We are a leading provider of comprehensive payroll and integrated human resource and employee
benefits outsourcing solutions for small- to medium-sized businesses in the United States (“U.S.”).
As of May 31, 2006, we serviced approximately 543,000 clients and had approximately 10,900 employees.
We maintain our corporate headquarters in Rochester, New York, and have more than 100 offices
nationwide.
We also had approximately 500 clients in Germany as of May 31, 2006, which are serviced
through offices in Hamburg and Berlin. Sales offices in Munich and Dusseldorf were operational
early in the fiscal year ending May 31, 2007.
Our company was formed as a Delaware corporation in 1979. We report our results of operations
and financial condition as one business segment. Our fiscal year ends May 31.
Company Strategy
We are focused on achieving strong long-term financial performance by:
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Providing high-quality, timely, accurate, and affordable comprehensive payroll and
integrated human resource services. |
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Delivering these services utilizing a well-trained and responsive work force through a
network of local and corporate offices servicing more than 100 of the largest markets in
the U.S. and in Germany. |
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Growing our client base, primarily through the efforts of our direct sales force. |
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Continually improving client service and maximizing client retention. |
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Capitalizing on the growth opportunities within our current client base and from new
clients, by increasing utilization of our payroll-related and human-resource-related
ancillary products and services. |
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Capitalizing on and leveraging our highly developed technological and operating
infrastructure. |
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Supplementing our growth through strategic acquisition or expansion of service offerings
when opportunities arise. |
Market Opportunities
The outsourcing of business processes is a growing trend within the U.S. Outsourcing of the
payroll and human resource functions allows small- to medium-sized businesses to minimize the
administrative burden and compliance risks associated with increasingly complex and changing
administrative requirements and federal, state, and local tax regulations. By utilizing the
expertise of outsourcing service providers, businesses are better able to efficiently meet their
compliance requirements and administrative burdens while, at the same time, providing competitive
benefits for their employees. The technical capabilities, knowledge, and operational expertise that
we have built, along with the broad portfolio of ancillary services we offer our clients, have
enabled us to capitalize on the outsourcing trend.
As of May 31, 2006, we believed there were approximately 7.6 million employers in the
geographic markets that we serve within the U.S. Of those employers, 99% have fewer than
100 employees and are our primary customers and target market. Based on publicly available industry
data, we estimate that all payroll processors combined serve somewhere between 15% to 20% of the
potential businesses in the target market, with much of the unpenetrated market being composed of
businesses with ten or fewer employees. We remain focused on servicing small- to medium-sized
businesses based upon the growth potential that we believe exists in this market segment.
Clients
We serve a diverse base of small- to medium-sized clients operating in a broad range of
industries located throughout the continental U.S. As of May 31, 2006, we serviced approximately
543,000 clients. We utilize service agreements and arrangements with clients that are generally
terminable by the client at any time or upon relatively short notice. For the year ended May 31,
2006, client retention was at record levels of slightly less than 80% of our beginning client base.
The most significant factor contributing to client losses is companies going out of business. No
single client has a material impact on total service revenue or results of operations.
Products and Services
We offer a comprehensive portfolio of payroll, payroll-related, and human resource products
and services to meet the diverse needs of our client base. These include:
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payroll processing; |
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payroll tax administration services; |
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employee payment services; |
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regulatory compliance services (new-hire reporting and garnishment processing); |
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comprehensive human resource outsourcing services; |
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retirement services administration; |
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workers’ compensation insurance administration; |
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employee benefits administration; |
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time and attendance solutions; |
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health benefits; and |
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other human resource services and products. |
By offering ancillary services that leverage the information gathered in the base payroll
processing service, we are able to provide comprehensive outsourcing services that allow employers
to expand their employee benefits offerings at an affordable cost. We earn our revenue primarily
through recurring fees for services performed. Service revenue is primarily driven by the number
of clients, utilization of ancillary services, and checks or transactions per client per pay
period.
RISK FACTORS
Our future results of operations are subject to a number of risks and uncertainties. These
risks and uncertainties could cause actual results to differ materially from historical and current
results and from our projections. Important factors known to us that could cause such differences
include, but are not limited to, those discussed below:
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General market and economic conditions, including, among others, changes in U.S.
employment and wage levels, changes in new hiring trends, changes in short- and long-term
interest rates, and changes in the market value and the credit rating of securities held by
us; |
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Changes in demand for our products and services, ability to develop and market new
products and services effectively, pricing changes and the impact of competition, and the
availability of skilled workers; |
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Changes in the laws regulating collection and payment of payroll taxes, professional
employer organizations, and employee benefits, including retirement plans, workers’
compensation, state unemployment, and section 125 plans; |
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Changes in our Professional Employer Organization direct costs, including, but not
limited to, workers’ compensation rates and underlying claims trends; |
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The possibility of failure to keep pace with technological changes and provide timely
enhancements to products and services; |
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The possibility of failure of our operating facilities, computer systems, and
communication systems during a catastrophic event; |
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The possibility of third-party service providers failing to perform their functions; |
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The possibility of penalties and losses resulting from errors and omissions in
performing services; |
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The possible inability of our clients to meet their payroll obligations; |
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The possible failure of internal controls or our inability to implement business
processing improvements; and |
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Potentially unfavorable outcomes related to pending legal matters. |
In addition to the above, the following risk factors should also be considered:
We may make errors and omissions in providing services, which could result in significant
penalties and liabilities for us: Processing, tracking, collecting, and remitting client funds to
the applicable tax or regulatory agencies, client employees, and other third parties are complex
operations. These tasks could be subject to error and these errors could include, but are not
limited to, late filing with applicable tax or regulatory agencies, underpayment of taxes, and
failure to comply with applicable banking regulations and laws relating to employee benefits
administration, which could result in significant penalties and liabilities that would adversely
affect our results of operations. We could also transfer funds in error to an incorrect party or
for the wrong amount, and may be unable to correct the error or recover the funds, resulting in a
loss to us.
Our business and reputation may be affected by our ability to keep clients’ information
confidential: Our business involves the use of significant amounts of private and confidential
client information including employees identification numbers, bank accounts, and retirement
account information. This information is critical to the accurate and timely provision of services
to our clients, and certain information may be transmitted via the internet. There is no guarantee
that our systems and processes are adequate to protect against all security breaches. If our
systems are disrupted or fail for any reason, or if our systems are infiltrated by unauthorized
persons, our clients could experience data loss, financial loss, harm to reputation, or significant
business interruption. Such events may expose us to unexpected liability, litigation, regulation
investigation and penalties, loss of clients’ business, unfavorable impact to business reputation,
and there could be a material adverse effect on our business and results of operations.
We
may be adversely impacted by changes in government regulations and
policies: Many of our
services, particularly payroll tax administration services and benefit plan administration
services, are designed according to government regulations that continue to change. Changes in
regulations could affect the extent and type of benefits employers are required, or may choose, to
provide employees or the amount and type of taxes employers and employees are required to pay. Such
changes could reduce or eliminate the need for some of our services and substantially decrease our
revenue. Added requirements could also increase our cost of doing business. Failure by us to modify
our services in a timely fashion in response to regulatory changes could have adverse effects on
our business and results of operations.
We may be adversely impacted by failure of third-party service providers to perform their
functions: As part of providing services to clients, we rely on a number of third-party service
providers. These providers include, but are not limited to, couriers used to deliver client payroll
checks and banks used to electronically transfer funds from clients to their employees. Failure by
these providers, for any reason, to deliver their services in a timely manner could result in
material interruptions to our operations, impact client relations, and result in significant
penalties or liabilities to us.
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In the event of a catastrophe, our business continuity plan may fail, which could result in
the loss of client data and adversely interrupt operations: Our operations are dependent on our
ability to protect our infrastructure against damage from catastrophe or natural disaster,
unauthorized security breach, power loss, telecommunications failure, terrorist attack, or other
events that could have a significant disruptive effect on our operations. We have a business continuity plan
in place in the event of system failure due to any of these events. If the business continuity plan
is unsuccessful in a disaster recovery scenario, we could potentially lose client data or
experience material adverse interruptions to our operations or delivery of services to our clients.
We may not be able to keep pace with changes in technology: To maintain our growth strategy,
we must adapt and respond to technological advances and technological requirements of our clients.
Our future success will depend on our ability to enhance capabilities and increase the performance
of our internal use systems, particularly our systems that meet our clients’ requirements. We
continue to make significant investments related to the development of new technology. If our
systems become outdated, we may be at a disadvantage when competing in our industry. There can be
no assurance that our efforts to update and integrate systems will be successful. If we do not
timely integrate and update our systems, or if our investments in technology fail to provide the
expected results, there could be an adverse impact to our business and results of operations.
We may not realize the anticipated benefits from acquisitions: The effective integration of
acquired companies may be difficult to achieve. It is also possible that we may not realize any or
all expected benefits from acquisitions or achieve benefits from acquisitions in a timely manner.
In addition, we may incur significant costs and management’s time and attention may be diverted in
connection with the integration of acquisitions. Failure to effectively integrate future
acquisitions could affect our results of operations. We currently have no definitive agreements or
current plans with respect to any material prospective acquisitions.
We may have an adverse outcome of legal matters, which could harm our business: We are
subject to various claims and legal matters that arise in the normal course of business. These
include disputes or potential disputes related to breach of contract, employment-related claims,
tax claims, and other matters. As of August 31, 2006, we have a reserve of $20.3 million for
pending legal matters. In light of the legal reserve recorded, our management currently believes
that resolution of these matters will not have a material adverse effect on our financial position
or results of our operations. However, these matters are subject to inherent uncertainties and
there exists the possibility that their ultimate resolution could have a material adverse impact on
our financial position and results of operations in the period in which any such effect is
recorded.
We may experience a loss as the result of our clients having insufficient funds to cover
payments we have made on their behalf to applicable tax or regulatory agencies and employees: As
part of the payroll processing service, we are authorized by our clients to transfer money from
their bank accounts to fund amounts owed to their employees and applicable tax or regulatory
agencies. It is possible that we would be held liable for such amounts in the event the client has
insufficient funds to cover them. We have in the past, and may in the future, make payments on our
clients’ behalf for which we are not reimbursed, resulting in a loss to us.
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Our interest earned on funds held for clients may be impacted by changes in government
regulations mandating the amount of tax withheld or timing of remittance: We receive interest
income from investing client funds collected but not yet remitted to applicable tax or regulatory
agencies or to client employees. A change in regulations either decreasing the amount of taxes to
be withheld or allowing less time to remit taxes to applicable tax or regulatory agencies would
adversely impact this interest income.
We may be exposed to additional risks related to a foreign operation as a result of our
business in Germany: We had approximately 500 clients in Germany as of May 31, 2006. As a result,
our business is subject to political and economic instability unrelated to our operations in the
U.S. Additionally, our business in Germany exposes us to currency fluctuations and we must operate
under legal and tax regulations that differ from those of the U.S. We do not currently hedge our
foreign currency transactions due to the relatively insignificant amounts. Our entry into foreign
operations requires a significant investment and management’s attention. There can be no assurance
that our investment in Germany will produce expected levels of revenue or that other factors noted
previously will not harm our business.
Any of these factors could cause our actual results to differ materially from our anticipated
results. The information provided in this document is based upon the facts and circumstances known
at this time. We undertake no obligation to update these forward-looking statements after the date
of this prospectus to reflect events or circumstances after such date, or to reflect the occurrence
of unanticipated events.
USE OF PROCEEDS
All of the shares of common stock are being offered by the Selling Stockholder. We will not
receive any proceeds from the sale of the shares by the Selling Stockholder, but we will receive
funds in connection with the exercise of any stock options relating to such shares. We will use
these funds for working capital.
SELLING STOCKHOLDER
Jonathan J. Judge, our President and Chief Executive Officer and a Director, is the Selling
Stockholder with respect to all of the shares covered by this prospectus. Mr. Judge assumed these
roles effective October 1, 2004. The following table indicates the number of shares currently
owned by Mr. Judge, the number of shares that he may sell pursuant to this prospectus, and the
number and percentage of outstanding shares he would own as of the date hereof if he sells all of
the shares covered by this prospectus, based on our 380,430,009 shares issued and outstanding as of
August 31, 2006:
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Number of Shares |
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Maximum Number |
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and Options |
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of Shares to be |
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Shares Held |
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Ownership |
| Selling Stockholder: |
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Beneficially Owned: |
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Offered: |
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After Offering: |
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After Offering: |
Jonathan J. Judge, |
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1,083,334(2)(3) |
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2,976 |
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*(4) |
President, CEO, Director |
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Less than 1% |
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Represents shares beneficially owned by Mr. Judge, including all stock options and
restricted shares that he has been granted under these Plans through the date of this
prospectus. |
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Represents all outstanding options and restricted shares granted to Mr. Judge under
these Plans, as if such options had been exercised in full when vested and all such
restricted shares had been earned in full. |
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Does not constitute a commitment to sell any or all of the shares shown. Any of such
shares sold will be determined by Mr. Judge from time to time in his sole discretion. |
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Assumes all shares acquired by Mr. Judge under these Plans are sold. |
PLAN OF DISTRIBUTION
We are registering the shares on behalf of the Selling Stockholder. All costs, expenses and
fees in connection with the registration of the shares offered hereby will be borne by us.
Brokerage commissions and similar selling expenses, if any, attributable to the sale of the shares
will be borne by the Selling Stockholder. The decision to sell any or all of the shares is within
the discretion of the Selling Stockholder and subject generally to our policies affecting the
timing and manner of sale of common stock by our affiliates. There can be no assurance that any
shares will be sold by the Selling Stockholder. The Selling Stockholder is free to offer and sell
the shares at such times, in such manner and at such prices as he shall determine. The Selling
Stockholder has advised us that sales of shares may be effected from time to time in one or more
types of transactions (which may include block transactions) on the Nasdaq, in negotiated
transactions, in private transactions, or in a combination of such methods of sale, at market
prices prevailing at the time of sale, or at negotiated prices. The Selling Stockholder also may
resell all or a portion of the shares in open market transactions in reliance upon Rule 144 under
the Securities Act, provided he meets the criteria and conforms to the requirements of that Rule.
Broker-dealers effecting such transactions may receive compensation in the form of discounts,
concessions, or commissions from the Selling Stockholder and/or the purchasers of shares in amounts
to be negotiated immediately prior to the sale. The Selling Stockholder has advised us that he has
not entered into any agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of the shares, nor is there an underwriter or coordinating broker
acting in connection with the proposed sale of the shares by the Selling Stockholder. The Selling
Stockholder and any broker-dealers that act in connection with the sale of the shares might be
deemed to be “underwriters” within the meaning of Section 2(11) of the Securities Act, and any
commissions received by such broker-dealers and any profit on the resale of the shares sold by them
might be deemed to be underwriting discounts or commissions under the Securities Act. The Selling
Stockholder may agree to indemnify any agent, dealer or broker-dealer that participates in
transactions involving sales of the shares against certain liabilities including liabilities
arising under the Securities Act. Because the Selling Stockholder may be deemed to be an
“underwriter” within the meaning of Section 2(11) of the Securities Act, he will be subject to the
prospectus delivery requirements of the Securities Act, which may include delivery through the
facilities of the Nasdaq pursuant to Securities Act Rule 153. We have
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informed the Selling Stockholder that the anti-manipulative provisions of Regulation M promulgated
under the Securities Exchange Act of 1934 (the “Exchange Act”) may apply to his sales in the
market.
LEGAL MATTERS
The validity of the shares being offered by this prospectus has been passed upon for us by
Harter, Secrest & Emery, LLP.
EXPERTS
Our
Consolidated Financial Statements appearing in our Annual Report on Form 10-K (“Form 10-K”) for the
year ended May 31, 2006 and management’s assessment of the effectiveness of internal control over
financial reporting as of May 31, 2006 including schedule
appearing therein, have been audited by Ernst & Young LLP,
independent registered public accounting firm, as set forth in their reports thereon, included
therein, and incorporated herein by reference. Such financial statements and management’s
assessment are incorporated herein by reference in reliance upon such reports given on the
authority of such firm as experts in accounting and auditing.
INCORPORATION BY REFERENCE
The
following documents that we have previously filed with the Securities
and Exchange Commission (“SEC”) are incorporated herein by
reference:
(a) Our Form 10-K for the fiscal year ended May 31, 2006, filed pursuant to Section 13 of the
Exchange Act on July 21, 2006, including information incorporated by reference in the Form 10-K
from our definitive proxy statement for our 2006 annual meeting of stockholders filed on August 31,
2006; and the amendment to this Form 10-K filed under cover of Form 10-K/A on September 8, 2006.
(b) Our Quarterly Report on Form 10-Q (“Form 10-Q”) for the quarterly period ended August 31,
2006, filed on September 26, 2006.
(c) The description of our common stock contained in our registration statement on Form S-1
(Registration No. 2-85103) and in any amendment or report filed for the purpose of amending such
description.
In addition, all documents that we file pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act subsequent to the date of this registration statement and prior to the filing of a
post-effective amendment which indicates that all securities offered hereby have been sold or which
deregisters all securities remaining unsold shall be deemed to be incorporated by reference herein
and to be a part hereof from the date of the filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein will be deemed to be
modified or superseded for purposes of this registration statement to the extent that a statement
contained herein or in any subsequently filed document that also is or is deemed to be incorporated
by reference herein modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part of this registration
statement.
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This prospectus incorporates by reference documents that are not presented herein or
delivered herewith. Such documents (other than exhibits to such documents unless such exhibits are
specifically incorporated by reference) are available without charge to any person to whom this
prospectus is delivered, upon written or oral request. Requests for such documents should be
directed to Paychex, Inc., 911 Panorama Trail South, Rochester, New
York 14625-2396, Attention:
Corporate Secretary; telephone: (585) 385-6666.
FURTHER INFORMATION
We are subject to the information requirements of the Exchange Act and in accordance
therewith, file reports, proxy statements and other information with the SEC. The reports, proxy
statements and other information filed by us with the SEC can be read and copied at the Public
Reference Room of the SEC at 100 F Street, N.E., Washington, D.C. 20549. Information regarding the
operation of the Public Reference Room can be obtained by calling the SEC at 1-800-SEC-0330.
Additionally, the SEC maintains a World Wide Web site on the Internet that contains reports, proxy
and information statements and other information regarding registrants that file electronically
with the SEC that is located at http://www.sec.gov. We also timely provide through our
website http://www.paychex.com, our periodic and current reports after they are filed with
the SEC. No person is authorized to give any information or to make any representations, other than
those contained in this prospectus, in connection with the offering described herein, and, if given
or made, such information or representations must not be relied upon as having been authorized by
us or the Selling Stockholder. This prospectus does not constitute an offer to sell, or a
solicitation of an offer to buy, nor shall there be any sale of these securities by any person in
any jurisdiction in which it is unlawful for such person to make such offer, solicitation or sale.
Neither the delivery of this prospectus nor any sale made hereunder shall under any circumstances
create an implication that the information contained herein is correct as of any time subsequent to
the date hereof.
12
Part II
INFORMATION REQUIRED IN THE
REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference.
The following documents that we have previously filed with the SEC are incorporated herein by
reference:
(a) Our Form 10-K for the fiscal year ended May 31, 2006, filed pursuant to Section 13 of the
Exchange Act on July 21, 2006, including information incorporated by reference in the Form 10-K
from our definitive proxy statement for our 2006 annual meeting of stockholders filed on August 31,
2006; and the amendment to this Form 10-K filed under cover of Form 10-K/A on September 8, 2006.
(b) Our Form 10-Q for the quarterly period ended August 31, 2006, filed on September 26, 2006.
(c) The description of our common stock contained in our registration statement on Form S-1
(Registration No. 2-85103) and in any amendment or report filed for the purpose of amending such
description.
In addition, all documents that we file pursuant to Sections 13(a), 13(c), 14 and 15(d) of the
Exchange Act subsequent to the date of this registration statement and prior to the filing of a
post-effective amendment which indicates that all securities offered hereby have been sold or which
deregisters all securities remaining unsold shall be deemed to be incorporated by reference herein
and to be a part hereof from the date of the filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein will be deemed to be
modified or superseded for purposes of this registration statement to the extent that a statement
contained herein or in any subsequently filed document that also is or is deemed to be incorporated
by reference herein modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part of this registration
statement.
Item 4. Description of Securities.
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
Not Applicable.
Item 6. Indemnification of Directors and Officers.
The General Corporation Law of Delaware (Section 102) allows a corporation to eliminate the
personal liability of directors of a corporation to the corporation or to any of its stockholders
for monetary damage for a breach of his/her fiduciary duty as a director, except in the case where
the director breached his/her duty of loyalty, failed to act in good faith, engaged in intentional
misconduct or knowingly violated a law, authorized the payment of a dividend or
13
approved a stock repurchase in violation of Delaware corporate law, or obtained an improper
personal benefit.
The following provision is contained in the Registrant’s Certificate of Incorporation: “No
director shall be personally liable to the corporation or its stockholders for monetary damages for
breach of fiduciary duty as a director, provided that this provision shall not eliminate or limit
the liability of a director (i) for any breach of the director’s duty of loyalty to the corporation
or its stockholders, (ii) for acts or omissions not in good faith which involve intentional
misconduct or a knowing violation of law, (iii) for paying a dividend or approving a stock
repurchase which was illegal under Section 174 (or any successor section) of the Delaware General
Corporation Law, or (iv) for any transaction from which the director derived an improper personal
benefit. The foregoing provisions shall not eliminate or limit the liability of a director from
any act or omission occurring prior to the date when such provisions become effective.”
The General Corporation Law of Delaware (Section 145) gives Delaware corporations broad powers
to indemnify their present and former directors and officers and those of affiliated corporations
against expenses incurred in the defense of any lawsuit to which they are made parties by reason of
being or having been such directors or officers, subject to specified conditions and exclusions;
gives a director or officer who successfully defends an action the right to be so indemnified; and
authorizes the Registrant to buy directors’ and officers’ liability insurance. Such
indemnification is not exclusive of any other right to which those indemnified may be entitled
under any bylaw, agreement, vote of stockholders or otherwise.
Our Certificate of Incorporation provides for indemnification to the fullest extent authorized
by Section 145 of the General Corporation Law of Delaware for our directors, officers and employees
and also to persons who are serving at our request as directors, officers or employees of other
corporations (including subsidiaries); provided that, with respect to proceedings initiated by such
indemnitee, indemnification shall be provided only if such proceedings were authorized by the Board
of Directors. The right of indemnification is not exclusive of any other right which any person
may acquire under any statute, bylaw, agreement, contract, vote of stockholders or otherwise.
We have entered into Indemnity Agreements with each of our officers and directors. The
agreement alters or clarifies the statutory indemnity in the following respects: (i) indemnity is
explicitly provided for settlements in derivative actions, (ii) we are obligated to advance a
director’s or officer’s expenses of defending an action against him/her if the director or officer
undertakes to repay such advances if he/she is ultimately found not to be entitled to
indemnification or he/she is otherwise reimbursed for the expenses, (iii) indemnification is
mandatory unless a determination is made that the director or officer has not met the required
standard, (iv) the director or officer is permitted to petition a court to determine whether
his/her actions met the standards required and the burden is placed on us to prove that the
director’s or officer’s conduct did not meet the required standard, and (v) partial indemnification
is permitted in the event that the director or officer is not entitled to full indemnification.
Item 7. Exemption from Registration Claimed.
Not applicable.
14
Item 8. Exhibits.
See Exhibit Index.
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective
amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the effective date of the
Registration Statement (or the most recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the information set forth in the Registration
Statement;
(iii) To include any material information with respect to the plan of distribution not
previously disclosed in the Registration Statement or any material change to such information in
the Registration Statement; provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed with or furnished to the Commission by the Registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities Act of 1933, each
such post-effective amendment shall be deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of determining liability
under the Securities Act of 1933, each filing of the Registrant’s Annual Report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in
the registration statement shall be deemed to be a new Registration Statement relating to the
securities offered herein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling persons of the Registrant pursuant to the
foregoing provisions of this Registration Statement, or otherwise, the Registrant has been advised
that in the opinion of the Securities and Exchange Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer or
15
controlling person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final adjudication of such issue.
16
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all the requirements for filing
on Form S-8, and has duly caused this Post-Effective Amendment No. 1 to this Registration Statement
to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rochester,
State of New York, on the 2nd day of October, 2006.
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PAYCHEX, INC.
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By: |
/s/ John M. Morphy
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John M. Morphy, |
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Senior Vice President,
Chief Financial Officer and Secretary |
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Pursuant to the requirements of the Securities Act of 1933, this Post-Effective Amendment No.
1 to this Registration Statement has been signed below by the following persons in the capacities
indicated on October 2, 2006.
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/s/ Jonathan J. Judge
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President and |
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Jonathan J. Judge
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Chief Executive Officer, |
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and Director |
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(Principal Executive Officer) |
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/s/ John M. Morphy
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Senior Vice President, Chief |
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John M. Morphy
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Financial Officer and Secretary |
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(Principal Financial |
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and Principal Accounting Officer) |
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*
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Chairman of the Board |
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B. Thomas Golisano |
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*
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Director |
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David J. S. Flaschen |
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*
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Director |
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Phillip Horsley |
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*
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Director |
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Grant M. Inman |
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Director |
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Pamela A. Joseph |
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*
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Director |
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J. Robert Sebo |
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*
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Director |
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Joseph M. Tucci |
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*
By: /s/ John M. Morphy
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as Attorney-in-fact |
John M. Morphy |
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EXHIBIT INDEX
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| Exhibit No. |
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Description |
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Location |
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4-1(a)
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Paychex, Inc. Non-Qualified Stock
Option Agreement with Jonathan J. Judge
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Previously filed as
Exhibit 4-1 to Form S-8
Registration Statement
No. 333-129571 |
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4-1(b)
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Paychex, Inc. 2002 Stock Incentive Plan
(as amended and restated effective
October 12, 2005)
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Previously filed as
Exhibit 4-1 to Form S-8
Registration Statement
No. 333-129572 |
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4-2
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Employment Agreement with
Jonathan J. Judge
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Incorporated by reference
to Exhibit 10.1 to
Registrant’s report on
Form 8 - K filed on
October 4, 2004. |
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5-1
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Legal Opinion of Harter, Secrest
& Emery LLP
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Filed herewith |
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23-1
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Consent of Harter, Secrest
& Emery LLP
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Contained in opinion
filed as Exhibit 5-1
to this Registration
Statement |
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23-2
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Consent of Ernst & Young LLP
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Filed herewith |
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24-1
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Power of Attorney
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Previously filed |