1
Exhibit 1.1
3,000,000 Shares
PIONEER-STANDARD ELECTRONICS, INC.
COMMON SHARES
UNDERWRITING AGREEMENT
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March 6, 1997
Lazard Freres & Co. LLC
Xxxxxx Gull Xxxxxxx &
XxXxxxxx Inc.
XxXxxxxx & Company Securities, Inc.
as representatives of the
several Underwriters named
on Schedule I hereto
c/o Lazard Freres & Co. LLC
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
SECTION 1. INTRODUCTION. Pioneer-Standard Electronics, Inc.,
an Ohio corporation (the "Company"), proposes to issue and sell to the several
Underwriters named in Schedule I hereto (the "Underwriters") an aggregate of
3,000,000 Common Shares of the Company, without par value (the "Firm Shares").
The Company also proposes to sell to the Underwriters, upon the terms and
conditions set forth in Section 3 hereof, up to an additional 450,000 Common
Shares of the Company, without par value (the "Additional Shares"). The Firm
Shares and the Additional Shares are hereinafter sometimes collectively referred
to as the "Securities." The Company hereby agrees with the Underwriters as
follows:
SECTION 2. REPRESENTATIONS, WARRANTIES AND AGREEMENTS
OF THE COMPANY. The Company represents and warrants to, and
agrees with, the Underwriters that:
(a) A registration statement on Form S-3 (No. 333- 07665),
including a prospectus, relating to the Securities has been filed by
the Company pursuant to the Securities Act of 1933, as amended (the
"Act") with the Securities and Exchange Commission (the "Commission").
Such registration statement either (i) is not proposed to be amended
and has been declared effective under the Act, and any post-
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effective amendments filed with the Commission prior to the execution
and delivery of this Agreement have been declared effective or (ii) is
proposed to be amended by amendment or post-effective amendment. For
purposes of this Agreement, "Effective Time" means, in the case of
clause (i) in the preceding sentence, the date and time as of which
such registration statement or the most recent post-effective amendment
thereto (if any) filed prior to the execution and delivery of this
Agreement was declared effective by the Commission or, in the case of
clause (ii) in the preceding sentence, the date and time as of which
such registration statement, as amended by such amendment or
post-effective amendment, as the case may be, is declared effective by
the Commission. "Effective Date" means the date of the Effective Time.
If the Effective Time is prior to the execution and delivery of this
Agreement, no other document relating to such registration statement
has been filed with the Commission; and no proceeding for the purpose
of suspending such effectiveness has been initiated or threatened or,
to the knowledge of the Company, is contemplated by the Commission.
Such registration statement as amended at the Effective Time, including
all material incorporated by reference therein and all exhibits thereto
and including all information (if any) contained in a prospectus
subsequently filed with the Commission and deemed to be part of the
registration statement at the Effective Time pursuant to Rule 430A
under the Act, is hereinafter referred to as the "Registration
Statement," and the prospectus, in the form first filed pursuant to
Rule 424(b) under the Act ("Rule 424(b)") or, if no such filing is
required, as included in the Registration Statement, including all
material incorporated by reference in such prospectus is, hereinafter
referred to as the "Prospectus." The terms "supplement" and "amendment"
or "amend" as used in this Agreement shall include all documents
subsequently filed by the Company with the Commission pursuant to the
Securities Exchange Act of 1934 (the "Exchange Act") and the rules and
regulations of the Commission thereunder (the "Exchange Act Rules and
Regulations") that are incorporated by reference in the Prospectus.
(Any preliminary prospectus included in such Registration Statement or
filed with the Commission pursuant to Rule 424(a) under the Act is
hereinafter referred to as a "Preliminary Prospectus.")
(b) If the Effective Time is prior to the execution and
delivery of this Agreement: (i) on the Effective Date, the Registration
Statement conformed, on the date of this Agreement, the Registration
Statement conforms, and at the time of filing of the Prospectus
pursuant to Rule 424(b), the Registration Statement and the Prospectus
will conform in all respects to the requirements of the Act and the
rules and regulations of the Commission thereunder (the "Rules and
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Regulations"), (ii) on the Effective Date, neither the Registration
Statement nor the Prospectus included any untrue statement of a
material fact or omitted to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, (iii) any amendment to the Registration Statement, as of
its date and as of its effective date, did not and will not include any
untrue statement of material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading and (iv) the Prospectus on the date of this
Agreement, as of its date, as of the date of any amendment or
supplement thereto, and as amended or supplemented at the Closing Date
(as defined in Section 3), does not and will not contain any untrue
statement of a material fact or omit to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. If the
Effective Time is subsequent to the execution and delivery of this
Agreement: (i) on the Effective Date, the Registration Statement and
the Prospectus will conform in all respects to the requirements of the
Act and the Rules and Regulations, and neither the Registration
Statement nor the Prospectus will include any untrue statement of a
material fact or will omit to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, (ii) any amendment to the Registration Statement, as of its
date and as of its effective date, will not include any untrue
statement of material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading and (iii) the Prospectus, as of its date, as of the date of
any amendment or supplement thereto, and as amended or supplemented at
the Closing Date, will not contain any untrue statement of any material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. The foregoing representations and warranties
do not apply to statements or omissions in the Registration Statement
or any amendment thereto or the Prospectus, as amended or supplemented,
if applicable, based upon the information furnished to the Company by
the Underwriters specified in Section 8(a).
(c) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, conformed in all respects to the requirements of the Act
and the Rules and Regulations and the Exchange Act and the Exchange Act
Rules and Regulations, as applicable, and none of such documents when
they became effective or were so filed, as the case may be, contained
any untrue statement of any material fact or
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omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; and any
further documents so filed and incorporated by reference in the
Prospectus or any further amendment or supplement thereto, when such
documents become effective or are filed with the Commission, as the
case may be, will conform in all material respects to the requirements
of the Act and the Rules and Regulations and the Exchange Act and the
Exchange Act Rules and Regulations, as applicable, and will not contain
any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements
therein not misleading.
(d) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission and no
proceedings for that purpose shall have been instituted or threatened
or, to the knowledge of the Company, contemplated by the Commission,
and each Preliminary Prospectus, at the time of filing thereof,
conformed in all material respects to the requirements of the Act and
the Rules and Regulations, and did not contain any untrue statement of
a material fact or omit to state any material fact necessary to make
the statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, this representation
and warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with the information furnished to the
Company by the Underwriters as specified in Section 8(a).
(e) The consolidated financial statements included in the
Registration Statement and Prospectus present fairly the consolidated
financial position of the Company and its consolidated subsidiaries as
of the dates indicated and the results of their operations and the
statements of their cash flows for the periods specified; such
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis during the
periods involved, except as indicated therein; and the supporting
schedules included in the Registration Statement present fairly the
information required to be stated therein.
(f) Since the respective dates as of which information is
given in the Registration Statement and in the Prospectus, except as
otherwise stated therein, (i) there has been no material adverse change
in the condition, financial or otherwise, earnings, business or
prospects of the Company and its subsidiaries considered as a whole,
whether or not arising in the ordinary course of business, and (ii)
there have been no material transactions entered
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into by the Company or any of its subsidiaries other than
those in the ordinary course of business.
(g) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Ohio with power and authority to own, lease and operate its
properties and conduct its business as described in the Registration
Statement and Prospectus; and the Company is duly qualified as a
foreign corporation to transact business and is in good standing in
each jurisdiction in which it owns or leases real property or in which
the conduct of its business requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would
not have a material adverse effect on the Company and its subsidiaries
considered as a whole.
(h) Each of the subsidiaries of the Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has power and
authority to own, lease and operate its properties and conduct its
business as described in the Registration Statement and the Prospectus
and is duly qualified as a foreign corporation to transact business and
is in good standing in each jurisdiction in which it owns or leases
real property or in which the conduct of its business requires such
qualification, except to the extent that the failure to be so qualified
or be in good standing would not have a material adverse effect on the
Company and its subsidiaries considered as a whole; all of the issued
and outstanding capital stock of each subsidiary has been duly
authorized and validly issued and is fully paid and non-assessable, and
all such capital stock of each subsidiary is owned, directly or through
subsidiaries, by the Company, free and clear of any mortgage, pledge,
lien, encumbrance, adverse claim or equity.
(i) Neither the Company nor any of its subsidiaries is (i) in
violation of its or any of their charters or codes of regulation or
bylaws, as the case may be, or other organizational documents or (ii)
in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any material contract,
indenture, mortgage, loan agreement, note, lease or other agreement or
instrument to which it or any of them is a party or by which it or any
of them or their properties may be bound, except in the case of (ii)
above, where such default would not, individually or in the aggregate,
result in a material adverse change in (A) the condition, financial or
otherwise, earnings, business or prospects of the Company and its
subsidiaries taken as a whole, or (B) the ability of the Company and
any subsidiary to enter into, perform and
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effect the transactions contemplated hereby; no consent, approval,
authorization, order, registration, filing or qualification of or with
any court or governmental authority or agency is required for the issue
and sale of the Securities as contemplated herein or the consummation
by the Company of the transactions contemplated by this Agreement,
except such as may be required under the Act and the Rules and
Regulations or state securities or Blue Sky laws in connection with the
distribution of the Securities by the Underwriters; and the issue and
sale of the Securities as contemplated herein, the execution and
delivery of this Agreement and the consummation of the transactions
contemplated herein will not conflict with or constitute a breach of,
or default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
of its subsidiaries pursuant to, any contract, indenture, mortgage,
loan agreement, note, lease or other agreement or instrument to which
the Company or any of its subsidiaries is a party or by which it or any
of them may be bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will any such action
result in any violation of, the provisions of the charter or code of
regulation of the Company or any law, administrative regulation or
administrative or court decree or order applicable to the Company or
any of its subsidiaries.
(j) The Company and its subsidiaries possess all certificates,
authorities or permits issued by the appropriate state, federal or
foreign regulatory agencies or bodies necessary to conduct the business
now operated by them, and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such certificate, authority or permit
which, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would materially and adversely
affect the condition, financial or otherwise, earnings, business or
prospects of the Company and its subsidiaries considered as a whole.
(k) Except as set forth in the Prospectus, as amended or
supplemented, there is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, contemplated or threatened against
the Company or any of its subsidiaries, which might result in any
material adverse change in the condition, financial or otherwise,
earnings, business or prospects of the Company and its subsidiaries
considered as a whole, or might materially and adversely affect the
properties or assets thereof or might adversely affect the lawful
issuance and
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offering of the Securities in the manner contemplated by the
Prospectus; and there are no material contracts or other documents
which are required to be described in the Registration Statement or the
Prospectus or filed as exhibits to the Registration Statement by the
Act or by the Rules and Regulations which have not been so described or
have not been so filed.
(l) Each of the Company and its subsidiaries has good and
marketable title in fee simple to all real property and good and
marketable title to all personal property owned by it, in each case
free and clear of all liens, encumbrances and defects except (i) such
as are referred to in the Prospectus or (ii) such as do not materially
and adversely affect the value of such property to the Company or such
subsidiary, and do not materially interfere with the use made and
proposed to be made of such property by the Company or such subsidiary;
and any real property and buildings held under lease by the Company and
its subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material and do not
interfere with the use made and proposed to be made by the Company and
its subsidiaries.
(m) The Company has an authorized capitalization as set forth
in the Prospectus, and the shares of capital stock of the Company
outstanding prior to the issuance of the Securities have been duly
authorized, are validly issued, fully paid and non-assessable (except
that the Subscription Shares will not be fully paid and non-assessable
until payment for such Subscription Shares is received as provided in
the Subscription Trust), and conform to the description thereof
contained in the Prospectus. The Securities have been duly authorized
and, when issued and delivered in accordance with the terms of this
Agreement, will be validly issued, fully paid and non-assessable. The
issuance and sale of all the Securities is not subject to pre-emptive
or other similar rights or to restrictions on transfer (other than
those imposed by the Act, the Rules and Regulations or state securities
or Blue Sky laws).
(n) This Agreement has been duly authorized, executed and
delivered by the Company.
(o) Neither the Company nor any of its officers, directors or
holders of five percent or more of any class of its capital stock or
any of their respective affiliates is a member of, or is associated or
affiliated with a member of, the National Association of Securities
Dealers, Inc.
(p) There are no contracts, agreements or understandings
between the Company and any person granting such
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person the right to require the Company to file a registration
statement under the Act with respect to any securities of the Company
owned or to be owned by such person or to require the Company to
include such securities under the Registration Statement.
(q) Ernst & Young LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the Rules and Regulations.
(r) The Share Subscription Agreement and Trust, effective as
of July 2, 1996, between the Company and Wachovia Bank of North
Carolina, N.A., as Trustee (the "Subscription Trust"), has been duly
authorized, executed and delivered by the Company and constitutes a
valid and legally binding agreement of the Company; the 5,000,000
Common Shares, without par value, of the Company (the "Subscription
Shares") to be issued pursuant to the terms of the Subscription Trust
have been duly authorized and when issued in accordance with the terms
of the Subscription Trust will be validly issued and outstanding; the
Subscription Shares, when paid for as provided by the Subscription
Trust, will be fully paid and non-assessable; the issuance of the
Subscription Shares pursuant to the terms of the Subscription Trust
does not constitute a Control Share Acquisition as defined in Section
1701.01(2)(1) of the Ohio Revised Code; the execution and performance
of the Subscription Trust does not violate or result in a change in
control under any material contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Company is a
party or by which it is bound; and the Subscription Trust conforms to
the description thereof in the Prospectus.
SECTION 3. PURCHASE, SALE AND DELIVERY OF SECURITIES. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Company hereby agrees
to issue and sell to the Underwriters, and each Underwriter agrees, severally
and not jointly, to purchase from the Company, at a purchase price of $12.28 per
Security (the "purchase price per Security"), the respective number of Firm
Shares (subject to such adjustments to eliminate fractional shares as you may
determine) that bear the same proportion to the number of Firm Shares to be sold
by the Company, as the number of Firm Shares set forth opposite such
Underwriter's name in Schedule I hereto bears to the total number of Firm
Shares.
The Company hereby agrees to issue and sell to the
Underwriters and, on the basis of the representation, warranties and agreements
herein contained, but subject to the terms and
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conditions herein set forth, the Underwriters shall have the right to purchase,
severally and not jointly, from the Company, pursuant to an option to be
exercised in the 30-day period commencing on the date of this Agreement, up to
450,000 Additional Shares at the purchase price per Security. Additional Shares
may be purchased solely for the purpose of covering over-allotments made in
connection with the offering of the Firm Shares. If any Additional Shares are to
be purchased, each Underwriter agrees, severally and not jointly, to purchase
from the Company that proportion of the total number of Additional Shares
(subject to adjustment by you to eliminate fractions) to be purchased as the
number of Firm Shares set forth opposite the name of such Underwriter in
Schedule I hereto bears to the total number of Firm Shares. In the event that
the Underwriters purchase less than all the Additional Shares, the number of
Additional Shares to be sold by the Company shall be, as nearly as practicable,
in the same proportion to each other as are the number of Additional Shares to
be sold by the Company as set forth herein and in Schedule I hereto.
The Company will deliver the Firm Shares to you for the
accounts of the Underwriters, against payment of the purchase price therefor by
wire transfer in same day funds or by one or more certified or official bank
checks payable in New York Clearing House or other same day funds drawn to the
order of the Company. Payment for the Firm Shares shall be made at the office of
Lazard Freres & Co. LLC, New York, New York at 10:00 A.M., New York Time, on
March 12, 1997 or at such other place, date or time as you and the Company may
agree upon in writing (the "Initial Closing Date").
The Company will deliver the Additional Shares to be purchased
to you for the accounts of the Underwriters, against payment of the purchase
price therefor by wire transfer in same day funds or by one or more certified or
official banks checks payable in New York Clearing House or other same day funds
drawn to the order of the Company, at the office of Lazard Freres & Co. LLC, New
York, New York on such date and at such time (the "Option Closing Date"), as
shall be specified in the notice from Lazard Freres & Co. LLC to the Company
exercising the option to purchase Additional Shares. The Option Closing Date may
be the same as the Initial Closing Date but shall in no event be earlier than
the Initial Closing Date nor earlier than two nor later than ten business days
after the giving of the notice hereinafter referred to. Such notice may be
given, by letter or by telecopy or other facsimile transmission or by telephone
(if subsequently confirmed in writing), to the Company at any time within 30
days after the date of this Agreement. The Option Closing Date may be varied by
agreement between the Underwriters and the Company. The Initial Closing Date and
the Option Closing Date are herein collectively referred to as the "Closing
Date."
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The certificates for all the Firm Shares and the Additional
Shares so to be delivered will be in such denominations and registered in such
names as you request two full business days prior to the Initial Closing Date or
the Option Closing Date, as the case may be, and will be made available at the
office of Lazard Freres & Co. LLC, New York, New York or, upon your request,
through the facilities of The Depository Trust Company, for checking and
packaging at least one full business day prior to the Initial Closing Date or
the Option Closing Date, as the case may be.
The Company and each of its executive officers, directors and
holders of five percent or more of any class of its capital stock agree that,
without your prior written consent, it will not offer, sell, contract to sell,
file a registration statement with the Commission in respect of, or otherwise
dispose of, or write or enter into a cash settled option with respect to, any
shares of any class of capital stock of the Company or any securities
convertible into or exercisable or exchangeable for such shares of capital stock
for a period of 90 days after the date of this Agreement, other than (i) the
Securities to be sold hereunder and (ii) any shares of such capital stock
acquired upon the exercise of an option outstanding on the date hereof or
referred to in the Prospectus.
SECTION 4. OFFERING BY THE UNDERWRITERS. After the
Registration Statement becomes effective, the several Underwriters will offer
the Securities for sale to the public on the terms and conditions as set forth
in the Prospectus.
SECTION 5. COVENANTS OF THE COMPANY. The Company covenants and
agrees with the several Underwriters that:
(a) If the Effective Time is prior to the execution and
delivery of this Agreement, the Company will file the Prospectus with
the Commission pursuant to and in accordance with subparagraph (1) (or,
if applicable, and with your consent, subparagraph (4)) of Rule 424(b)
not later than the earlier of (i) the second business day following the
execution and delivery of this Agreement or (ii) if such filing is made
after the fifth business day after the Effective Date, subparagraph (2)
(or, if applicable and with your consent, subparagraph (5)) of Rule
424(b). The Company will advise the Underwriters promptly of any
proposal to amend or supplement the Registration Statement as filed, or
the related Prospectus, prior to the Closing Date, and will not effect
such amendment or supplement without your consent; the Company will
also advise the Underwriters promptly of the effectiveness of the
Registration Statement (if the Effective Time is subsequent to the
execution and delivery of this Agreement), of any amendment or
supplement to the Registration Statement or the Prospectus, and of
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receipt of notification of the institution by the Commission of any
stop order proceedings in respect of the Registration Statement or of
any order preventing or suspending the use of any Preliminary
Prospectus or any prospectus relating to the Securities, of the
suspension of the qualification of the Securities for offering or sale
in any jurisdiction or the initiation or threatening of any proceeding
for such purpose, or of any request by the Commission to amend or
supplement the Registration Statement or Prospectus or for additional
information and will use its best efforts to prevent the issuance of
any such stop order or of any order preventing or suspending the use of
any Preliminary Prospectus or any prospectus relating to the Securities
or suspending any such qualification and to obtain as soon as possible
its lifting, if issued.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus as then amended or supplemented
would, in the judgment of the Underwriters, include an untrue statement
of a material fact, or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which
they were made, not misleading, or if it is necessary at any time to
amend or supplement the Prospectus to comply with the Act, the Exchange
Act or any other law, the Company promptly will prepare and file with
the Commission an amendment or supplement which will correct such
statement or omission or an amendment which will effect such compliance
and will notify the Underwriters and, upon the Underwriters' request
prepare and furnish without charge to the Underwriters and to any
dealer in securities as many copies as the Underwriters may from time
to time reasonably request, of an amended Prospectus or a supplement to
the Prospectus complying with Section 10(a) of the Act which will
correct such statement or omission or effect such compliance.
(c) The Company will make generally available to the Company's
security holders as soon as practicable an earnings statement covering
the twelve-month period ending March 31, 1998, that satisfies the
provisions of Section 11(a) of the Act and the Rules and Regulations
(including Rule 158).
(d) The Company will deliver to the Underwriters as many
signed and conformed copies of the Registration Statement (as
originally filed) and of each amendment thereto (including exhibits
filed therewith and documents incorporated therein by reference) as the
Underwriters may reasonably request and will also deliver to the
Underwriters a conformed copy of the Registration Statement and each
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amendment thereto (including documents incorporated therein
by reference).
(e) The Company will take such action as the Underwriters may
reasonably request to qualify the Securities for offering and sale
under the applicable securities laws of such states and other
jurisdictions of the United States as the Underwriters may designate,
and will maintain such qualifications in effect for as long as may be
required for the distribution of the Securities. The Company will file
such statements and reports as may be required by the laws of each
jurisdiction in which the Securities have been qualified as above
provided.
(f) During the period of five years hereafter, the Company
will furnish to the Underwriters as soon as practicable after the end
of each fiscal year, a copy of its annual report to shareholders for
such year, and the Company will furnish to the Underwriters (i) as soon
as available, a copy of each report or definitive proxy statement of
the Company filed with the Commission under the Exchange Act or mailed
to shareholders and (ii) from time to time, such other information
concerning the Company as the Underwriters may reasonably request.
(g) The Company, during the period when the prospectus
relating to the Securities is required to be delivered under the Act,
will file promptly all documents required to be filed with the
Commission pursuant to Section 13, 14 or 15 of the Exchange Act.
(h) The Company will use its best efforts to obtain the
inclusion of the Securities on the Nasdaq National Market.
SECTION 6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS.
The obligations of the several Underwriters to purchase and pay for the
Securities on the Initial Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Company herein as of the date
hereof and as of the Initial Closing Date with the same force and effect as if
made as of that date, to the performance by the Company of its obligations
hereunder and to the following additional conditions precedent:
(a) If the Effective Time is not prior to the execution and
delivery of this Agreement, the Effective Time shall have occurred not
later than 5:00 P.M., New York time, on the date of this Agreement, or
such later time or date as shall have been consented to by the
Underwriter. If the Effective Time is prior to the execution and
delivery of this Agreement, the Company shall have filed the Prospectus
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with the Commission pursuant to Rule 424(b) within the applicable time
period prescribed for such filing by the Rules and Regulations and in
accordance with Section 5(a) hereof. In either case, prior to the
Initial Closing Date no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted or threatened, or to the
knowledge of the Company or the Underwriters, shall be contemplated by
the Commission; and the Company shall have complied with all requests
for additional information on the part of the Commission to your
reasonable satisfaction.
(b) The Underwriters shall not have advised the Company that
the Registration Statement or Prospectus, or any amendment or
supplement thereto, contains any untrue statement of fact or omits to
state any fact which, you concluded, is material and in the case of an
omission is required to be stated therein or is necessary to make the
statements therein not misleading.
(c) The Underwriters shall have received a favorable opinion
of Xxxxxx, Halter & Xxxxxxxx, counsel for the Company, dated the
Closing Date, to the effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Ohio with power and authority to own,
lease and operate its properties and conduct its business as
described in the Registration Statement and the Prospectus;
and the Company is duly qualified to transact business and is
in good standing in each jurisdiction in which it owns or
leases real property.
(ii) Each of the subsidiaries of the Company has been
duly incorporated and is validly existing as a corporation in
good standing under the laws of the jurisdiction of its
incorporation, has power and authority to own, lease and
operate its properties and conduct its business as described
in the Registration Statement and the Prospectus, and is duly
qualified as a foreign corporation to transact business and is
in good standing in each jurisdiction in which it owns or
leases real property; all of the issued and outstanding
capital stock of each subsidiary has been duly authorized and
validly issued and is fully paid and non-assessable, and all
of such capital stock is owned by the Company free and clear
of any pledge, lien, encumbrance, adverse claim or equity.
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(iii) This Agreement has been duly authorized,
executed and delivered by the Company.
(iv) The Company has an authorized capitalization as
set forth in the Prospectus, and the shares of capital stock
of the Company outstanding prior to the issuance of the
Securities to be sold by the Company have been duly
authorized, are validly issued, fully paid and non-assessable
(except that the Subscription Shares will not be fully paid
and non-assessable until payment for such Subscription Shares
is received as provided in the Subscription Trust), and
conform to the description thereof contained in the
Prospectus.
(v) The Securities to be sold by the Company have
been duly authorized and validly issued and are fully paid and
non-assessable, and the issuance and sale of all the
Securities is not subject to pre-emptive or other similar
rights or to restrictions on transfer (other than those
imposed by the Act, the Rules and Regulations or state
securities or Blue Sky laws).
(vi) The Registration Statement is effective under
the Act and, to the best of their knowledge and information,
no stop order suspending the effectiveness of the Registration
Statement or any part thereof has been issued under the Act or
proceedings therefor initiated or threatened or are pending or
contemplated by the Commission.
(vii) Statements set forth in the Prospectus under
the headings "Prospectus Supplement Summary", "Use of
Proceeds", "The Company", "Description of Certain
Indebtedness", "Description of Debt Securities", and
"Description of Capital Stock", and in the Registration
Statement under Item 15 on Form S-3 insofar as such statements
constitute a summary of the legal matters, documents or
proceedings referred to therein fairly present the information
called for with respect to such legal matters, documents and
proceedings.
(viii) No consent, approval, authorization, order,
filing, registration or qualification of or with any court or
governmental authority or agency is required for the issue and
sale of the Securities or the consummation of the transactions
contemplated by this Agreement, except such as may be required
and have been obtained under the Act and the Rules and
Regulations and such as may be required under state securities
or Blue Sky laws in connection with the distribution of the
Securities by the Underwriters;
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and, the issue and sale of the Securities, the execution and
delivery of this Agreement and the consummation of the
transactions contemplated herein will not conflict with or
constitute a breach of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of its
subsidiaries pursuant to, any material contract filed in
response to paragraphs (4) and (10) of Item 601(b) of
Regulation SK or other instrument to which the Company or any
of its subsidiaries is a party or by which it or any of them
may be bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such
action result in any violation of, the provisions of the
charter or code of regulations of the Company, or any law,
administrative regulation or administrative or court decree or
order applicable to the Company or any of its subsidiaries.
(ix) To the best knowledge of such counsel, (1) after
having made due inquiry, there is no governmental action or
proceeding and no litigation pending against the Company or
any of its subsidiaries which would adversely affect the
lawful issuance and offering of the Securities or that is
required to be described in the Registration Statement or
Prospectus and is not so described and (2) after having made
due inquiry, there are no material contracts or other
documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement that are not so
described or filed as required.
(x) Such counsel (1) is of the opinion that each
document incorporated by reference in the Registration
Statement and the Prospectus (other than the financial
statements and related schedules and other financial and
statistical data included therein, as to which no opinion need
be expressed) complied as to form when filed with the
Commission in all material respects with the Exchange Act and
the Exchange Act Rules and Regulations and did not contain any
untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading; (2) is of the opinion that the
Registration Statement, as of the Effective Date, any
amendment to the Registration Statement, as of its date or as
of its effective date, and the Prospectus, as of the Effective
Date and as of its date (other than the financial statements
and related schedules and other financial and statistical data
included therein, as to
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which no opinion need be expressed) complies as to form in all
material respects with the requirements of the Act and the
Rules and Regulations; and (3) has no reason to believe that
(other than the financial statements and related schedules and
other financial and statistical data included therein, as to
which no opinion need be expressed) the Registration
Statement, as of the Effective Date, any amendment to the
Registration Statement, as of its date or as of its effective
date, and the Prospectus, as of the Effective Date, contained
any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary
to make the statements therein not misleading and that the
Prospectus, as of its date, as of the date of any amendment or
supplement thereto, and as amended or supplemented at the
Initial Closing Date, contained or contains any untrue
statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made, not misleading.
In rendering such opinion, such counsel may: (i) rely
in respect of matters of fact upon certificates of
governmental officials and officers of the Company, provided
that such certificates have been attached to such opinion; and
(ii) state that they express opinions only as to the laws of
the United States of America and of the State of Ohio and
that, with respect to their opinion in clause (iii), they are
assuming as to all matters of New York law (if any) that the
application of New York law to such matters would have the
same effect as would the application of the laws of the State
of Ohio to such matters if such matters were governed by Ohio
law. The opinions set forth above as to the due incorporation
of the Company's Pioneer-Standard of Maryland, Inc. subsidiary
in Maryland will be rendered by Xxxxx Xxxxxxx, L.L.P., or
another acceptable Maryland law firm. The opinion above as to
the due incorporation of the Company's Pioneer-Standard Canada
Inc. subsidiary in Canada will be rendered by Blake, Xxxxxxx &
Xxxxxxx, or another acceptable Canada law firm. Xxxxxx, Halter
& Xxxxxxxx shall state that they believe that the Underwriters
are justified in relying upon such opinions referred to in the
previous two sentences.
(d) The Underwriters shall have received an opinion from each
of Xxxxx Xxxxxxx, L.L.P., and Blake, Xxxxxxx & Xxxxxxx, each a counsel
for the Company, with respect to the due incorporation of
Pioneer-Standard of Maryland, Inc., and Pioneer Standard Canada Inc.,
respectively.
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(e) The Underwriters shall have received from Sidley & Austin,
counsel for the Underwriters, an opinion, dated the Closing Date, with
respect to such matters as the Underwriters may reasonably request.
(f) The Underwriters shall have received from the President or
any Vice President and a principal financial or accounting officer of
the Company a certificate, dated the Initial Closing Date, in which
such officers, to the best of their knowledge and after reasonable
investigation, shall state that there has not been, since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, (i) any material adverse change in the
condition, financial or otherwise, earnings, business or prospects of
the Company and its subsidiaries considered as a whole, whether or not
arising in the ordinary course of business or (ii) any material
transactions entered into by the Company or any of its subsidiaries
other than those in the ordinary course of business, except in the case
of clause (i) and clause (ii) as set forth in or contemplated by the
Prospectus; the representations and warranties of the Company contained
in Section 2 are true and correct with the same force and effect as
though made on and as of the Closing Date and the Company has complied
with all agreements and satisfied all conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date; and
no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
initiated or threatened or are contemplated by the Commission.
(g) The Underwriters shall have received from Ernst & Young
LLP, independent public accountants, two letters, the first dated the
date of this Agreement and the other dated such Initial Closing Date,
addressed to the Underwriters, substantially in the form of Annex I
hereto with such variations as are reasonably acceptable to the
Underwriters.
(h) At the Initial Closing Date counsel for the Underwriters
shall have been furnished with such other documents and opinions as
they may reasonably require.
(i) The Securities shall have been duly included on the Nasdaq
National Market.
(j) You shall have received from each director and executive
officer and each required stockholder of the Company a written
agreement previously agreed to by the parties to the effect set forth
in the last paragraph of Section 3.
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The several obligations of the Underwriters to purchase the
Additional Shares hereunder are subject to (i) the accuracy of and compliance
with the representations and warranties of the Sellers contained herein on and
as of the Option Closing Date, (ii) satisfaction on and as of the Option Closing
Date of the conditions set forth in subsections (a) to (j) of this Section 6
inclusive (and for purposes thereof each reference therein to the Initial
Closing Date shall be deemed to refer to the Option Closing Date) and (iii) the
absence of circumstances on or prior to the Option Closing Date which would
permit termination of this Agreement pursuant to Section 10.
SECTION 7. PAYMENT OF EXPENSES. The Company will pay all
costs, expenses, fees, disbursements and taxes incident to (i) the preparation
by the Company, printing, filing and distribution of the Registration Statement
(including financial statements and exhibits), the Prospectus, each Preliminary
Prospectus and all amendments and supplements to any of them prior to or during
the period specified in Section 5(b), (ii) the preparation, printing (including
word processing and duplication costs) and delivery of this Agreement,
Preliminary and Supplemental Blue Sky Memoranda, Legal Investment Survey, if
any, and all other agreements, memoranda, correspondence and other documents
printed and delivered in connection with the offering of the Securities, (iii)
the registration with the Commission, and the issuance by the Company, of the
Securities, (iv) the registration or qualification of the Securities for offer
and sale under the securities or Blue Sky laws of the several states (including
the reasonable fees and disbursements of the Underwriters' counsel relating to
such registration or qualification), (v) filings and clearance with the National
Association of Securities Dealers, Inc. in connection with the offering, (vi)
fees and expenses, if any, incurred in connection with the inclusion of the
Securities on the Nasdaq National Market, (vii) the fees and expenses of the
Registrar and Transfer Agent for the Securities and its counsel, and (viii) the
performance by the Company of its other obligations under this Agreement, and
all other costs and expenses incident to the performance of its obligations
hereunder in this Section 7.
If this Agreement is terminated by the Underwriters in
accordance with the provisions of Section 10 hereof, the Company shall not then
be under any liability to the Underwriters except as provided in Sections 7 and
8 hereof, but, if for any other reason the Securities are not delivered by or on
behalf of the Company as provided herein, the Company shall reimburse the
Underwriters for all of their out-of-pocket expenses reasonably incurred in
connection with marketing and preparing for the purchase, sale and delivery of
the Securities, including the reasonable fees and disbursements of counsel for
the Underwriters but the Company shall then be under no further liability to the
Underwriters except as provided in Sections 7 and 8 hereof.
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SECTION 8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter
within the meaning of either Section 15 of the Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages and
liabilities (or actions in respect thereof) (including, without
limiting the foregoing, the reasonable legal and other expenses
incurred in connection with investigating or defending any action, suit
or proceeding or any claim asserted, as such expenses are incurred)
arising out of or based on any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or
the Prospectus or any Preliminary Prospectus or any other prospectus
with respect to the Securities, or caused by any omission or alleged
omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages, liabilities or expenses are
caused by any such untrue statement or omission or alleged untrue
statement or omission based upon the information furnished to the
Company in writing by the Underwriters in the Prospectus concerning the
terms of the offering by the Underwriters; and provided, further, that
the Company shall not be liable to any Underwriter under this
subsection (a) for any such loss, claim, damage or liability arising
from any Preliminary Prospectus or the Prospectus to the extent that
such loss, claim, damage or liability results from the fact that such
Underwriter sold Securities to a person to whom there was not sent or
given, at or prior to the written confirmation of such sale, a copy of
the Prospectus as then amended or supplemented, excluding documents
incorporated therein by reference, in any case where (i) such delivery
of the Prospectus as then amended or supplemented to such person is
required by the Act, (ii) the Company has previously furnished
sufficient copies thereof to such Underwriter at such time as is
sufficient to permit such delivery prior to such confirmation and (iii)
the loss, claim, damage or liability of such Underwriter results from
an untrue statement or omission of a material fact contained in the
Preliminary Prospectus or the Prospectus which was corrected in the
Prospectus as amended or supplemented, excluding documents incorporated
therein by reference. This indemnity agreement will be in addition to
any liability which the Company may otherwise have to the persons
referred to above in this Section 8(a).
(b) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, the directors of the Company,
the officers of the Company who sign the Registration Statement and
each person, if any, who
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controls the Company within the meaning of either Section 15 of the Act
or Section 20 of the Exchange Act from and against any and all losses,
claims, damages and liabilities (or actions in respect thereof) caused
by any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus or any
Preliminary Prospectus, or caused by any omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, but only with
reference to the information furnished to the Company by the
Underwriters set forth in the first sentence of Section 8(a). This
indemnity agreement will be in addition to any liability which the
Underwriters may otherwise have to the persons referred to above in
this Section 8(b).
(c) In case any action or proceeding (including any
governmental or regulatory investigation or proceeding) shall be
instituted involving any person in respect of which indemnity may be
sought pursuant to any of the two preceding paragraphs, such person
(hereinafter called the indemnified party) shall promptly notify the
person against whom such indemnity may be sought (hereinafter called
the indemnifying party) in writing; however, the omission to so notify
the indemnifying party shall relieve the indemnifying party from
liability under the two preceding paragraphs only to the extent
prejudiced thereby. The indemnifying party, upon request of the
indemnified party, shall assume the defense thereof, including the
employment of counsel reasonably satisfactory to the indemnified party
to represent the indemnified party and any others that the indemnifying
party may designate and shall pay the fees and disbursements of such
counsel related to such proceeding. In any such action or proceeding
any indemnified party shall have the right to retain its own counsel,
but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the
indemnified party and representation of both parties by the same
counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the indemnifying party
shall not, in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for (a) the reasonable fees and
expenses of more than one separate firm (in addition to any local
counsel) for all Underwriters and all persons, if any, who control any
Underwriters within the meaning of either Section 15 of the Act or
Section 20 of the Exchange Act, and (b) the reasonable fees and
expenses of more than one separate firm (in addition to any local
counsel) for the
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Company, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Company within the
meaning of either such Section, and that all such fees and expenses
shall be reimbursed as they are incurred. In the case of any such
separate firm for the Underwriters and such control persons of the
Underwriters, such firm shall be designated in writing by the
Underwriters. In the case of any such separate firm for the Company,
and such directors, officers and control persons of the Company, such
firm shall be designated in writing by the Company. The Company shall
not, without the prior written consent of any indemnified party, effect
any settlement of any pending or threatened proceeding in respect of
which any such indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject
matter of such proceeding.
(d) If the indemnification provided for in this Section 8 is
insufficient or unavailable to an indemnified party in respect of any
losses, claims, damages or liabilities (or actions in respect thereof)
referred to therein, then each indemnifying party, in lieu of
indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses,
claims, damages, liabilities and expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on
the one hand and the Underwriters on the other from the offering of the
Securities or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law or if the indemnified party shall have
failed to the prejudice of the indemnifying party to give the notice
required by Section 8(c), in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above
but also the relative fault of the Company on the one hand and the
Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities
or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriters on the other shall be deemed to be in the same proportions
as the total net proceeds from the offering (before deducting expenses)
received by the Company bear to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in
the table on the cover page of the Prospectus. The relative fault of
the Company on the one hand and the Underwriters on the other shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material
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fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the Underwriters
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
(e) The Company and the Underwriters agree that it would not
be just and equitable if contribution pursuant to Section 8(d) were
determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or
payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to in
the immediately preceding paragraph shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of Section 8(d), in no event shall any
Underwriter be required to contribute any amount in excess of the
amount by which the total price at which the Securities underwritten by
it and distributed to the public were offered to the public exceeds the
amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations to
contribute pursuant to Section 8(e) are several in proportion to the
respective number of Firm Shares set forth opposite their names in
Schedule I hereto and not joint.
(f) In the event that Lazard Freres & Co. LLC is an
indemnified or an indemnifying party in an action involving any one or
more Underwriters, Lazard Freres & Co. LLC shall control and direct the
proceedings on behalf of itself and the other Underwriters party
thereto.
SECTION 9. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO
SURVIVE DELIVERY. All representations, warranties and agreements contained in
the Agreement, or contained in certificates of officers of the Company submitted
hereto, including indemnity and contribution agreements, shall remain operative
and in full force and effect, regardless of any termination of this Agreement,
or any investigation, or any statement as to the results thereof, made by or on
behalf of any Underwriter or any person controlling any Underwriter or by or on
behalf of the Company, its officers or directors or controlling
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persons, and shall survive acceptance of and payment for Securities hereunder.
If this Agreement is terminated pursuant to Section 10 or if
for any reason the purchase of Securities by the Underwriters is not
consummated, the Company shall remain responsible for the reasonable expenses to
be paid or reimbursed by it pursuant to Section 7 and the respective obligations
of the Company and the Underwriters pursuant to Section 8 shall remain in
effect.
SECTION 10. TERMINATION. This Agreement may be terminated for
any reason at any time prior to the delivery and payment of the Securities on
the Initial Closing Date or the Option Closing Date, as the case may be, by
Lazard Freres & Co. LLC upon the giving of written notice of such termination to
the Company, if prior to such time (i) there has been, since the respective
dates as of which information is given in the Registration Statement and the
Prospectus, (A) any material adverse change in the condition, financial or
otherwise, earnings, business or prospects of the Company and its subsidiaries
considered as a whole, whether or not arising in the ordinary course of business
or (B) any material transaction entered into by the Company or any subsidiary
other than in the ordinary course of business, or (ii) there has occurred any
outbreak or escalation of hostilities or other calamity or crisis or material
change in existing national or international financial, political, economic or
securities market conditions, the effect of which is such as to make it, in the
judgment of Lazard Freres & Co. LLC; impracticable or inadvisable to market the
Securities in the manner contemplated in the Prospectus or enforce contracts for
the sale of the Securities, or (iii) reporting of bid and asked prices of the
Common Shares of the Company has been suspended by the National Association of
Securities Dealers, Inc., or trading in the Common Shares of the Company has
been suspended by the Commission or a national securities exchange, or trading
generally on the Nasdaq National Market has been suspended, or minimum or
maximum prices for trading have been fixed, or maximum ranges for prices for
securities have been required, by either of said exchanges or by order of the
Commission or any other governmental authority, or if a banking moratorium has
been declared by either Federal or New York authorities. In the event of any
such termination, the provisions of Section 7, the indemnity agreement and
contribution provisions set forth in Section 8, and the provisions of Sections 9
and 14 shall remain in effect.
SECTION 11. DEFAULT. If, on the Initial Closing Date or the
Option Closing Date, as the case may be, any one or more of the Underwriters
shall fail or refuse to purchase Securities that it or they have agreed to
purchase hereunder on such date, and the aggregate number of Securities which
such defaulting
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Underwriter or Underwriters agreed but failed or refused to purchase is not more
than one-tenth of the aggregate number of the Securities to be purchased on such
date, the other Underwriters shall be obligated severally in the proportions
that the number of Firm Shares set forth opposite their respective names in
Schedule I bear to the aggregate number of Firm Shares set forth opposite the
names of all such non-defaulting Underwriters, or in such other proportions as
you may specify, to purchase the Securities which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date; PROVIDED
that in no event shall the number of Securities that any Underwriter has agreed
to purchase pursuant to Section 3 be increased pursuant to this Section 11 by an
amount in excess of one-ninth of such number of Securities without the written
consent of such Underwriter. If, on the Initial Closing Date or the Option
Closing Date, as the case may be, any Underwriter or Underwriters shall fail or
refuse to purchase Securities and the aggregate number of Securities with
respect to which such default occurs is more than one-tenth of the aggregate
number of Securities to be purchased on such date, and arrangements satisfactory
to the non-defaulting Underwriters and the Company for the purchase of such
Securities are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter or the
Company. In any such case either you or the Company shall have the right to
postpone the Initial Closing Date or the Option Closing Date, as the case may
be, but in no event for longer than seven days, in order that the required
changes, if any, in the Registration Statement and in the Prospectus or in any
other documents or arrangements may be effected. Any action taken under this
paragraph shall not relieve any defaulting Underwriter from liability in respect
of any default of such Underwriter under this Agreement.
SECTION 12. NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Underwriters c/o Lazard Freres & Co. LLC,
00 Xxxxxxxxxxx Xxxxx, Xxx Xxxx, XX 00000, Attention: Syndicate Department; and
notices to the Company shall be directed to it at 0000 Xxxx 000xx Xxxxxx,
Xxxxxxxxx, XX 00000, facsimile transmission no. 216/587-3563, attention of the
Secretary with a copy to the Treasurer.
SECTION 13. PARTIES. This Agreement shall inure to the benefit
of and be binding upon the Company, its directors and officers who signed the
Registration Statement, the Underwriters, any controlling persons referred to
herein and their respective successors and assigns. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person, firm or corporation any legal or equitable right, remedy
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or claim under or in respect of this Agreement or any provision herein
contained. No purchaser of Securities from any Underwriter shall be deemed to be
a successor by reason merely of such purchase.
SECTION 14. GOVERNING LAW. This Agreement shall be
governed by, and construed in accordance with, the law of the State of New York.
SECTION 15. COUNTERPARTS. This Agreement may be executed in
two or more counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
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If the foregoing is in accordance with your understanding of our agreement,
please sign this Agreement and return to us six counterparts hereof.
Very truly yours,
PIONEER-STANDARD ELECTRONICS, INC.
By: /s/ Xxxx Xxxxxxx
--------------------------------
Name: Xxxx Xxxxxxx
Title: Vice President Treasurer
Confirmed and Accepted, as of the
date first above written:
LAZARD FRERES & CO. LLC,
XXXXXX GULL XXXXXXX & XxXXXXXX INC.
XxXXXXXX & COMPANY SECURITIES, INC.
as representatives of the
several Underwriters on
Schedule I hereto
By: Lazard Freres & Co. LLC
By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
------------------------------
Name: Xxxxxxx X. Xxxxxxxx, Xx.
Title: Managing Director
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ANNEX I
[FORM OF ANNEX I DESCRIPTION OF COMFORT
LETTER FOR REGISTRATION STATEMENTS ON FORM S-3]
Pursuant to Section 6(g) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the
Act and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules audited (and, if
applicable, prospective financial statements and/or pro forma financial
information examined) by them and included in the Prospectus or the
Registration Statement comply as to form in all material respects with
the applicable accounting requirements of the Act and the related
published Rules and Regulations; and, if applicable, they have made a
review in accordance with standards established by the American
Institute of Certified Public Accountants of the unaudited consolidated
interim financial statements, selected financial data, pro forma
financial information, prospective financial statements and/or
condensed financial statements derived from audited financial
statements of the Company for the periods specified in such letter, as
indicated in their reports attached to such letters, copies of which
have been furnished to the Underwriters;
(iii) On the basis of limited procedures, not constituting an
audit in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available
interim financial statements of the Company and its subsidiaries,
inspection of the minute books of the Board of Directors and the
committees thereof of the Company and its subsidiaries since the date
of the latest audited financial statements included in the Prospectus,
inquiries of officials of the Company and its subsidiaries responsible
for financial and accounting matters and such other inquiries and
procedures as may be specified in such letter, nothing came to their
attention that caused them to believe that:
(A) the unaudited consolidated statements of
income, consolidated balance sheets and consolidated
statements of cash flows included in the Prospectus do
28
not comply as to form in all material respects with the
applicable accounting requirements of the Act and the related
published Rules and Regulations, or are not in conformity with
generally accepted accounting principles applied on a basis
substantially consistent with the basis for the audited
consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the
Prospectus;
(B) any other unaudited income statement data and
balance sheet items included in the Prospectus do not agree
with the corresponding items in the unaudited consolidated
financial statements from which such data and items were
derived, and any such unaudited data and items were not
determined on a basis substantially consistent with the basis
for the corresponding amounts in the audited consolidated
financial statements included in the Prospectus;
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived any
unaudited condensed financial statements referred to in
paragraph (A) and any unaudited income statement data and
balance sheet items included in the Prospectus and referred to
in paragraph (B) were not determined on a basis substantially
consistent with the basis for the audited consolidated
financial statements included in the Prospectus;
(D) any unaudited pro forma consolidated condensed
financial statements included in the Prospectus do not comply
as to form in all material respects with the applicable
accounting requirements of the Act and the published Rules and
Regulations or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation
of those statements;
(E) as of a specified date not more than five days
prior to the date of such letter, there have been any changes
in the consolidated capital stock (other than issuances of
capital stock upon exercise of options and share appreciation
rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which were
outstanding on the date of the latest financial statements
included in the Prospectus) or any increase in the
consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current
assets or net assets or other items specified by the
Underwriters, or any increases in any items specified by the
Underwriters, in each case as compared
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with amounts shown in the latest balance sheet included in the
Prospectus, except in each case for changes, increases or
decreases which the Prospectus discloses have occurred or may
occur or which are described in such letter; and
(F) for the period from the date of the latest
financial statements included in the Prospectus to the
specified date referred to in paragraph (E) there were any
decreases in consolidated net revenues or operating profit or
the total or per share amounts of consolidated net income or
other items specified by the Underwriter, or any increases in
any items specified by the Underwriter, in each case as
compared with the comparable period of the preceding year and
with any other period of corresponding length specified by the
Underwriter, except in each case for decreases or increases
which the Prospectus discloses have occurred or may occur or
which are described in such letter;
(G) certain sections of the Prospectus did not comply
in all material respects with the disclosure obligations under
Regulation S-K under the Act (e.g., "Selected Financial Data"
(Item 301), "Supplementary Financial Information" (Item 302),
"Ratio of Earnings to Fixed Charges" (Item 503(d)) and
"Executive Compensation" (Item 402);
(iv) In addition to the audit referred to in their report(s)
included in the Prospectus and the limited procedures, inspection of
minute books, inquiries and other procedures referred to in paragraphs
(ii) and (iii) above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally
accepted auditing standards, with respect to certain amounts,
percentages and financial information specified by the Underwriter,
which are derived from the general accounting records of the Company
and its subsidiaries, which appear in the Prospectus, or in Part II of,
or in exhibits and schedules to, the Registration Statement specified
by the Representatives, and have compared certain of such amounts,
percentages and financial information with the accounting records of
the Company and its subsidiaries and have found them to be in
agreement.
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30
SCHEDULE I
UNDERWRITER NUMBER OF SHARES
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Lazard Freres & Co. LLC 655,000
Xxxxxx Gull Xxxxxxx & XxXxxxxx Inc. 655,000
XxXxxxxx & Company Securities, Inc. 655,000
Bear, Xxxxxxx & Co. Inc. 75,000
Alex. Xxxxx & Sons Incorporated 75,000
Xxxxx & Company 75,000
Xxxxxx, Read & Co. Inc. 75,000
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation 75,000
Xxxxxx Brothers Inc. 75,000
Xxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx Incorporated 75,000
Xxxxxx Xxxxxxx & Co. Incorporated 75,000
Xxxxxxxx Wertheim & Co. Incorporated 75,000
Xxxxx & Company Incorporated 40,000
Xxxxxx X. Xxxxx & Co. Incorporated 40,000
Xxxxxxxxx Securities Corporation 40,000
EVEREN Securities, Inc. 40,000
Xxxxxx Xxxx LLC 40,000
Xxxxxxxxx & Company, Inc. 40,000
The Ohio Company 40,000
SBK-Xxxxxx Investment Corp. 40,000
Wheat First Butcher Singer 40,000
TOTAL 3,000,000
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