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Exhibit 4.2
EXECUTION COPY
AMENDMENT NO. 2 TO NOTE PURCHASE AGREEMENT
This Amendment No. 2 to Note Purchase Agreement (this "Amendment") is
entered into as of November 30, 1995 by PIONEER-STANDARD ELECTRONICS, INC. (the
"Company") and TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA (the
"Noteholder").
PRELIMINARY STATEMENT.
1. The Company and the Noteholder have entered into a Note Purchase
Agreement, dated as of October 31, 1990 (the "Original Purchase Agreement"),
pursuant to which, at a closing held on November 2, 1990, the Noteholder
purchased $20,000,000 in aggregate principal amount of the Company's 9.79%
Senior Notes due November 1, 2000 (the "Notes"), which Original Purchase
Agreement has been amended by that certain Amendment No. 1 to Note Purchase
Agreement, dated as of November 1, 1991 (as so amended, the "Purchase
Agreement"). The Noteholder was the sole purchaser and remains the sole record
and beneficial owner of the Notes. Capitalized terms used herein and not
otherwise defined herein are used with the meanings assigned thereto in the
Purchase Agreement.
2. The Company now owns one hundred percent (100%) of the outstanding
capital stock of Pioneer-Standard Canada Inc., a corporation organized under
the laws of the Province of Ontario ("Pioneer/Canada"), and one hundred percent
(100%) of Pioneer-Standard of Maryland, Inc., a Maryland corporation
("Pioneer/Maryland"). As of the date of this Amendment, Pioneer/Maryland will
merge with and into Pioneer/Technologies Group, Inc., a Maryland corporation
("Pioneer/Technologies") (the "Merger"), with the survivor of the Merger,
Pioneer/Technologies, becoming the wholly-owned subsidiary of the Company and
changing its name to Pioneer-Standard of Maryland, Inc. The Company desires
that each of Pioneer/Canada, Pioneer/Maryland and Pioneer/Technologies be
designated as "Restricted Subsidiaries" under the Purchase Agreement.
3. Concurrently herewith the Company and Pioneer/Technologies have
entered into that certain Credit Agreement with certain lenders, including,
without limitation, National City Bank, a national banking association, as
agent thereunder (the "Credit Agreement"), pursuant to which the Company and
Pioneer/Technologies may borrow up to $200,000,000 in the aggregate. In
addition, the Company and Pioneer/Technologies may borrow up to $40,000,000 for
short-term overnight borrowing needs, the Company may enter into a $10,000,000
line of credit facility for foreign exchange purchases/sales, and
Pioneer/Canada may enter into a $10,000,000 line of credit facility for foreign
exchange purchases/sales (collectively, the "Short-Term Facility").
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4. Under Section Section 9.22 and 12.1 of the Purchase Agreement, a
Restricted Subsidiary must be, among other things, incorporated and organized
under the laws of the United States or any jurisdiction thereof, which would
prohibit Pioneer/Canada from being a Restricted Subsidiary. In addition,
Section 12.1 of the Purchase Agreement prohibits Pioneer/Technologies from
being a Restricted Subsidiary.
5. Under Section 9.10 of the Purchase Agreement, the Company is
required to maintain Consolidated Net Worth in an amount not less than the sum
of (a) $32,000,000 and (b) 50% of Cumulative Consolidated Net Income.
6. Under Section 9.13 and 9.14 of the Purchase Agreement,
the sum of Secured Debt and Restricted Subsidiary Indebtedness may not exceed
15% of Consolidated Net Worth. Under the Credit Agreement,
Pioneer/Technologies is permitted to borrow up to $75,000,000.
7. Under Section 9.15 of the Purchase Agreement, the ability of the
Company and each Restricted Subsidiary to merge or consolidate with any other
Person is subject to cerain conditions set forth therein.
8. Under Section 9.16 of the Purchase Agreement, the ability of the
Company and each Restricted Subsidiary to, directly or indirectly, in a single
transaction or a series of transactions, sell, lease, transfer, abandon or
otherwise dispose of all or any part of their property, other than in the
ordinary course of its business, is subject to certain conditions set forth
therein.
9. Under Section 9.19 of the Purchase Agreement, the Company and each
Restricted Subsidiary is prohibited from making Restricted Payments or
Restricted Investments unless certain financial and other tests are met.
10. Under Section 9.20 of the Purchase Agreement, the Company and its
Restricted Subsidiaries are prohibited from, directly or indirectly, expressly
or by operation of law, creating, incurring, issuing, assuming, guaranteeing or
in any manner becoming liable, contingently or otherwise, in respect of any
Funded Indebtedness unless, immediately thereafter, and after giving effect
thereto on a PRO FORMA basis, (i) the ratio of Consolidated Funded Indebtedness
to Total Capitalization is less than or equal to 0.65 to 1.00 at any time from
the Closing Date through and including December 31, 1994 and (ii) the ratio of
Consolidated Funded Indebtedness to Total Capitalization is less than or equal
to 0.60 to 1.00 at any time subsequent to December 31, 1994.
11. Under Section 12.1 of the Purchase Agreement, the Consolidated Net
Worth of the Company does not include the amount at which the Company's
investment in Pioneer/Technologies would be reflected on the balance sheet of
the Company.
12. On the terms and subject to the conditions set forth in this
Amendment, and as an inducement to the Noteholder to consent to the Merger and
certain other actions, the Company and the Noteholder desire to amend the
Purchase Agreement as set forth below.
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NOW, THEREFORE, the Company and the Noteholder agree as follows:
SECTION 1. GENERAL REPRESENTATIONS AND WARRANTIES OF
THE COMPANY.
The Company hereby represents and warrants to the Noteholder as
follows:
Section 1.1. REPRESENTATIONS AND WARRANTIES IN PURCHASE AGREEMENT. The
representations and warranties with respect to the Company contained in the
Purchase Agreement are true and correct in all material respects and the
Noteholder shall be entitled to rely on such representations and warranties as
if they were made to the Noteholder in this Amendment as of the date hereof.
Section 1.2. REPRESENTATIONS AND WARRANTIES IN CREDIT AGREEMENT. The
representations and warranties with respect to the Company contained in the
Credit Agreement and in any document, certificate or instrument delivered
pursuant to the Credit Agreement are true and correct in all material respects
and the Noteholder shall be entitled to rely on such representations and
warranties as if they were made to the Noteholder in this Amendment as of the
date hereof.
SECTION 2. AMENDMENTS TO THE PURCHASE AGREEMENT.
The Purchase Agreement is hereby amended in the following respects:
Section 2.1. AMENDMENT TO SECTION 9.10 OF THE PURCHASE AGREEMENT. Section
9.10 of the Purchase Agreement is hereby amended by deleting it in its
entirety and substituting the following new Section 9.10 in lieu thereof:
Section 9.10 MAINTENANCE OF CONSOLIDATED NET WORTH. The Company shall
at all times maintain a Consolidated Net Worth in an amount not less than
the sum of (a) $120,000,000, (b) 50% of Cumulative Consolidated Net Income
and (c) 100% of the net proceeds to the Company of any offering of equity
securities.
Section 2.2. AMENDMENT TO SECTION 9.13 OF THE PURCHASE AGREEMENT. Section
9.13 of the Purchase Agreement is hereby amended by deleting it in its
entirety and substituting the following new Section 9.13 in lieu thereof:
Section 9.13 LIENS. (a) Neither the Company nor any Restricted
Subsidiary will create, incur or suffer to exist any Lien on property
which is owned by the Company or such Restricted Subsidiary, respectively,
on the date hereof and which is not presently subject to any Lien or any
property which is hereafter acquired by the Company or any Restricted
Subsidiary, other than (i) Permitted Liens and (ii) any lien other than
Permitted Liens on such property which secures Debt ("Secured Debt"), so
long as (x) the sum of the principal amount of all Secured Debt
outstanding and the aggregate outstanding amount
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of Restricted Subsidiary Indebtedness created, incurred or suffered to
exist pursuant to Section 9.14 hereof at no time exceeds One Hundred
Million Dollars ($100,000,000), (y) there does not exist at the time of
incurrence or creation of any such Lien any Default or Event of Default
which has not been waived pursuant to Section 13.4 hereof or cured
pursuant to Section 11.4 hereof and (z) the creation, incurrence and
existence of such Secured Debt does not otherwise give rise to or
represent a Default or Event of Default (including, but not limited to, a
Default or Event of Default under Section 9.20 hereof).
(b) If any property of the Company or any Restricted Subsidiary is
subjected to a Lien in violation of this Section 9.13, there shall
automatically arise a Lien in favor of the holders of the Notes, or, if
legally necessary to satisfy the following requirements of this paragraph,
the Company will make or cause to be made provision whereby, in either
case, the Notes will be secured equally and ratably with all obligations
secured by such Lien, and, in any case, the Notes shall have the benefit,
to the full extent that, and with such priority as, the holders may be
entitled under applicable law, of an equitable Lien on such property
securing (in the manner as aforesaid) the Notes and such other
obligations. Such violation of this Section 9.13 shall constitute an Event
of Default hereunder, whether or not any such provision is made pursuant
to this Section 9.13(b).
Section 2.3. AMENDMENT TO SECTION 9.14 OF THE PURCHASE AGREEMENT. Section
9.14 of the Purchase Agreement is hereby amended by deleting it in its
entirety and substituting the following new Section 9.14 in lieu thereof:
Section 9.14 RESTRICTED SUBSIDIARY INDEBTEDNESS. The Company will not
permit any Restricted Subsidiary, directly or indirectly, expressly or by
operation of law, to create, incur, assume, guarantee, in any manner
become liable in respect of or suffer to exist any Restricted Subsidiary
Indebtedness unless the sum of the principal amount of all Restricted
Subsidiary Indebtedness outstanding and the aggregate outstanding amount
of Secured Debt created, incurred or suffered to exist pursuant to Section
9.13 hereof at no time exceeds One Hundred Million Dollars ($100,000,000),
and the creation, incurrence and existence of such Restricted Subsidiary
Indebtedness does not otherwise give rise to or represent a Default or
Event of Default. The Company will not permit Pioneer/Technologies,
directly or indirectly, expressly or by operation of law, to create,
incur, assume, guarantee, in any manner become liable in respect of or
suffer to exist any Indebtedness unless the sum of the principal amount of
all Indebtedness of Pioneer/Technologies outstanding at no time exceeds
Seventy-Five Million Dollars ($75,000,000). Notwithstanding anything
contained in this Section 9.14 to the contrary, the Company may permit and
suffer to exist (a) any Restricted Subsidiary Guaranty of the Indebtedness
of the Company incurred under the Credit Agreement, the Short-Term
Facility or hereunder, (b) Indebtedness of any Restricted Subsidiary
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incurred under the Short-Term Facility and (c) Indebtedness incurred by
Pioneer/Technologies under the Credit Agreement.
Section 2.4. AMENDMENT TO SECTION 9.15 OF THE PURCHASE AGREEMENT. Section
9.15 of the Purchase Agreement is hereby amended by deleting it in its
entirety and substituting the following new Section 9.15 in lieu thereof:
Section 9.15 MERGER; SALE OF ASSETS. Other than the Merger, none of
the Company or any Restricted Subsidiary will enter into any merger,
consolidation, reorganization or liquidation or transfer or otherwise
dispose of all or a Substantial Portion of its property or business,
unless approved in advance by the holders of at least 66-2/3% in
aggregate unpaid principal amount of the Notes then Outstanding.
Section 2.5. AMENDMENT TO SECTION 9.16 OF THE PURCHASE AGREEMENT. Section
9.16 of the Purchase Agreement is hereby amended by deleting it in its
entirety and substituting the following new Section 9.16 in lieu thereof:
Section 9.16 THIS SECTION INTENTIONALLY OMITTED.
Section 2.6. AMENDMENT TO SECTION 9.20 OF THE PURCHASE AGREEMENT. Section
9.20 of the Purchase Agreement is hereby amended by deleting it in its
entirety and substituting the following new Section 9.20 in lieu thereof:
Section 9.20 LIMITATIONS ON CONSOLIDATED FUNDED INDEBTEDNESS. The
Company will not permit the ratio of Consolidated Funded Indebtedness to
Total Capitalization of the Company and its Restricted Subsidiaries to be
greater than (i) 0.65 to 1.00 at any time from the Closing Date through
and including December 31, 1994, (ii) 0.60 to 1.00 at any time subsequent
to December 31, 1994 through and including Xxxxx 00, 0000, (xxx) 0.575 to
1.00 at any time subsequent to March 30,1997 through and including March
30, 1998 and (iv) 0.55 to 1.00 at any time subsequent to March 30, 1998.
Section 2.7. ADDITION OF SECTION 9.23 TO THE PURCHASE AGREEMENT. The
following new Section 9.23 shall be added to the Purchase Agreement:
Section 9.23 DELIVERY OF SUBSIDIARY GUARANTEES. Within 10 days after
the Company forms or acquires any Subsidiary, other than Pioneer/Canada or
Pioneer/Technologies, the Company shall cause such additional Subsidiary
to execute and deliver to each of the Noteholders a guarantee agreement
(together with such other documents as the Noteholders shall reasonably
request), in form and substance satisfactory to the Noteholders, whereby
such additional Subsidiary agrees that it shall be jointly and severally
liable for the obligations of the Company under the Purchase Agreement;
PROVIDED, HOWEVER, that the obligation to execute and deliver a guarantee
agreement shall not apply in the case of any particular additional
Subsidiary unless and until such Subsidiary
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has received funding from the Company and/or Pioneer/Technologies in
excess of $100,000 or the aggregate funding from the Company and/or
Pioneer/Technologies to all Subsidiaries (other than Pioneer/Technologies
and Pioneer/Canada) exceeds $500,000.
Section 2.8. ADDITION OF SECTION 9.24 TO THE PURCHASE AGREEMENT. The
following new Section 9.24 shall be added to the Purchase Agreement:
Section 9.24 INVESTMENT AND LOAN LIMIT. None of the Company or any
Restricted Subsidiary (other than Pioneer/Canada), together or
individually, directly or indirectly, in any instance or in the aggregate
over time may: (a) invest in any manner more than $10,800,000 in
Pioneer/Canada or (b) loan more than an aggregate principal amount of
$25,000,000 to Pioneer/Canada.
Section 2.9. AMENDMENT TO SECTION 11.1 OF THE PURCHASE AGREEMENT. Section
11.1 of the Purchase Agreement is hereby amended by deleting paragraph
(c) thereof in its entirety and substituting the following new paragraph
(c) in lieu thereof:
(c) the Company shall default in the due and punctual performance of
or compliance with any covenant, condition or agreement to be performed or
observed by it under Section 9.3(b) or Section Section 9.10 through 9.20
hereof; the Company shall use the proceeds of sale of the Notes other than
as described in Section 1.3 hereof; or the Company, pursuant to the
provisions of the Credit Agreement, shall be required to pay to or deposit
with the Agent or any Lender under the Credit Agreement an amount equal to
the face amount of the Interim Letter of Credit; or
Section 2.10. AMENDMENT TO SECTION 12. 1 OF THE PURCHASE AGREEMENT. Section
12.1 of the Purchase Agreement is hereby amended by deleting the definition of
"Consolidated Net Worth" in its entirety and substituting the following new
definition in lieu thereof:
The term "Consolidated Net Worth" shall mean, as of the date of
determination thereof, the sum of the amount of common stock, the
aggregate liquidation preference of any preferred stock, capital surplus
and retained earnings accounts, less treasury stock, which would appear on
a consolidated balance sheet of the Company and its Restricted
Subsidiaries as of the date of determination in accordance with generally
accepted accounting principles, less all Minority Interests.
Section 2.11. AMENDMENT TO SECTION 12.1 OF THE PURCHASE AGREEMENT. Section
12.1 of the Purchase Agreement is hereby amended by deleting the definition of
"Cumulative Consolidated Net Income" in its entirely and substituting the
following new definition in lieu thereof:
The term "Cumulative Consolidated Net Income" shall mean, as of the
date of determination thereof, an amount equal to the sum of the
Consolidated Net Income for (i) each complete Fiscal Year for which
financial statements have been delivered or are required to have been
delivered pursuant to
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Section 10.1(a) hereof and which commenced after September 30,
1995 and ended prior to such date of determination (treating each
such complete Fiscal Year as a separate accounting period for such
purpose) and (ii) each complete Fiscal Quarter for which financial
statements have been delivered or are required to have been
delivered pursuant to Section 10.1(b) hereof and which commenced
after the end of the last such complete Fiscal Year and ended
prior to such date of determination (treating each such complete
Fiscal Quarter as a separate accounting period for such purpose),
but without subtraction of the amount of any Consolidated Net Loss
for any such Fiscal Year or Fiscal Quarter.
Section 2.12. AMENDMENT TO SECTION 12.1 OF THE PURCHASE AGREEMENT.
Section 12.1 of the Purchase Agreement is hereby amended by deleting
the definition of "Current Liabilities" in its entirely and
substituting the following new definition in lieu thereof:
The term "Current Liabilities" of any Person, at any date of
determination, shall mean all amounts which, in accordance with
generally accepted accounting principles, would be included as
current liabilities on a balance sheet of such Person at such
date, but shall under any circumstances include all Indebtedness
payable on demand or maturing within one year after such date
without any option on the part of the obligor to extend or renew
beyond such year; provided, however, notwithstanding the
foregoing, in no event shall Current Liabilities include the
outstanding principal amount of loans made pursuant to the Credit
Agreement (excluding the Short-Term Facility) unless and until
the earlier to occur of (a) the Facility Termination Date and (b)
a default pursuant to the terms of the Credit Agreement.
Section 2.13. AMENDMENT TO SECTION 12.1 OF THE PURCHASE AGREEMENT.
Section 12.1 of the Purchase Agreement is hereby amended by deleting
the definition of "Funded Indebtedness" in its entirety and
substituting the following new definition in lieu thereof:
The term "Funded Indebtedness" of any Person, shall mean, as
of the date of any determination thereof, all Indebtedness of
such Person having a final maturity of one or more than one year
from the date of creation thereof (other than that portion of the
principal of such Funded Indebtedness due within one year from
such date of determination, but including, however, any
Indebtedness of such Person having a final maturity, duration or
payment date within one year from such date which, pursuant to
the terms of a revolving credit or similar agreement or otherwise
may be renewed or extended at the option of such Person for more
than one year from such date, whether or not theretofore renewed
or extended); provided, however, that Funded Indebtedness shall
include all Indebtedness incurred pursuant to the Credit
Agreement (including, without limitation, any letters of credit
referred to therein).
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Section 2.14. AMENDMENT TO SECTION 12.1 OF THE PURCHASE AGREEMENT.
Section 12.1 of the Purchase Agreement is hereby amended by deleting
the definition of "Indebtedness" in its entirety and substituting the
following new definition in lieu thereof:
The term "Indebtedness", with respect to any Person, shall
mean and include the aggregate amount of, without duplication:
(a) all obligations of such Person for borrowed money; (b) all
obligations of such Person evidenced by bonds, debentures, notes,
or other similar instruments; (c) all Capitalized Lease
Obligations of such Person; (d) all obligations or liabilities of
others secured by a Lien on any Asset owned by such Person,
irrespective or whether such obligation or liability is assumed,
to the extent of the lesser of such obligation or liability or
the fair market value of such Asset; (e) all obligations of such
Person to pay the deferred purchase price of Assets or services,
exclusive of trade and other payable which, by their terms, are
due and payable within ninety (90) calendar days of the creation
thereof and are not overdue or are being properly and
expeditiously contested in good faith by appropriate proceedings,
so long as appropriate reserves have been established and the use
by such Person of any Assets involved has not been materially
interfered with; (f) any liability (whether contingent or not) in
respect of unfunded vested accrued benefits under any Pension
Plan which is subject to Title IV of ERISA; (g) all liabilities
of such Person in respect of letters of credit or instruments
serving a similar function issued or accepted for its account by
banks and other financial institutions (whether or not
representing obligations for borrowed money); and (h) any
Guaranty of Indebtedness described in any of clauses (a) through
(g) above, including reimbursement obligations in respect of
letters of credit; provided, however, that Indebtedness shall not
include any Guaranty (i) by the Company of Indebtedness of a
Restricted Subsidiary or (ii) by a Restricted Subsidiary of
Indebtedness of another Restricted Subsidiary; and provided,
further, that, for purposes of any determination of Consolidated
Funded Indebtedness and Section 9.20 hereof, no Guaranty shall be
treated as Indebtedness if the obligation guaranteed thereby is
Indebtedness; and, provided, further, that Indebtedness shall not
include any Guaranty by the Company or a Restricted Subsidiary of
the Indebtedness of another Person if (i) treating such Guaranty
as Indebtedness would result in a violation of Section 9.20
hereof at the time the Company or such Restricted Subsidiary
becomes liable therefor, (ii) the Company elects (and evidences
such election by prompt written notice thereof to each holder of
a Note) to treat such Guaranty as a Restricted Investment and
(iii) treated as a Restricted Investment, the incurrence of such
Guaranty can be effected in compliance with Section 9.19 hereof.
Section 2.15. AMENDMENT TO SECTION 12.1 OF THE PURCHASE AGREEMENT.
Section 12.1 of the Purchase Agreement is hereby amended by deleting
the definition of "Restricted Investment" in its entirety and
substituting the following new definition in lieu thereof:
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The term "Restricted Investment" shall mean any Investment
(other than an Investment in, to or in favor of any Person which
is, or after the making of which, will be, a Restricted
Subsidiary) paid for with cash or other property (other than
equity securities of the Company) other than:
(a) any certificate of deposit with a final maturity
of one year or less issued by any bank or trust company
having capital and surplus at the end of its most recently
ended fiscal year in excess of $100,000,000;
(b) commercial paper of any corporation incorporated
in the United States of America maturing not more than 270
days from the date of issuance thereof and rated "A-1" or
better by Standard & Poor's Ratings Services ("S&P") or
"P-1" or better by Xxxxx'x Investors Service, Inc.
("Moody's"); provided, however, that any such commercial
paper that is rated by both such rating agencies shall be
rated "A-1" or better by S&P and "P-1" or better by Moody's;
(c) any direct obligation of the United States of
America or obligation of any instrumentality or agency
thereof the payment of the principal of and interest on
which is unconditionally guaranteed by the United States of
America; provided, however, that any such obligation shall
have a final maturity date not more than two years after the
acquisition thereof;
(d) the Investment by the Company or any Restricted
Subsidiary of the Company in Pioneer/Technologies;
(e) any Indebtedness or other security of the
Company or a Restricted Subsidiary which is purchased,
repurchased, redeemed, prepaid or acquired or reacquired in
any other manner by the Company or a Restricted Subsidiary,
so long as such Indebtedness or other security is retired or
cancelled promptly after its acquisition by the Company or
such Restricted Subsidiary; and
(f) any Investment by the Company or a Restricted
Subsidiary the making of which constitutes a Restricted
Payment.
Section 2.16. AMENDMENT TO SECTION 12.1 OF THE PURCHASE AGREEMENT.
Section 12.1 of the Purchase Agreement is hereby amended by deleting
the definition of "Restricted Subsidiary" in its entirety and
substituting the following new definition in lieu thereof:
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The term "Restricted Subsidiary" shall mean (i) any Subsidiary of the
Company hereafter designated by action of the Board of Directors of the
Company as a Restricted Subsidiary pursuant to Section 9.22 hereof and (ii)
any Subsidiary of the Company which executes and delivers to each of the
Noteholders a guaranty agreement pursuant to Section 9.23 hereof;
provided, however, that no corporation may be designated a Restricted
Subsidiaty unless:
(a) such corporation is organized under the laws of the United
States, Canada or any jurisdiction of the foregoing;
(b) such corporation conducts substantially all of its business
and owns substantially all of its property within the United States or
Canada;
(c) a majority of the shares of each class of the
capital stock of such Subsidiary is owned by the Company
directly or indirectly through another Restricted Subsidiary;
(d) such corporation has not previously been
designated as a Restricted Subsidiary hereunder and had such
designation rescinded; and
(e) the requirements of Section 9.22(a) have been complied with
or are complied with concurrently with such designation;
provided, further, that the designation of a Restricted Subsidiary may be
rescinded by action of the Board of Directors of the Company pursuant to
Section 9.22(c) hereof.
Section 2.17. AMENDMENT TO SECTION 12.1 OF THE PURCHASE AGREEMENT. The
following definitions are added to Section 12.1 of the Purchase Agreement, to
be inserted therein in the appropriate alphabetical order;
The term "Agent" shall have the meaning set forth in Article I of the
Credit Agreement.
The term "Credit Agreement" shall mean that certain Credit Agreement
among the Company, Pioneer/Technologies and certain lenders, including,
without limitation, National City Bank, a national banking association, as
agent thereunder, pursuant to which the Company and Pioneer/Technologies
may borrow up to $200,000,000 in the aggregate.
The term "Facility Termination Date" shall have the meaning set
forth in Article I of the Credit Agreement.
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The term "Interim Letter of Credit" shall have the meaning set forth in
Article I of the Credit Agreement.
The term "Lender" shall have the meaning set forth in Article I of
the Credit Agreement.
The term "Merger" shall mean the merger whereby Pioneer/Maryland will
acquire Pioneer/Technologies via a reverse cash-out merger with
Pioneer/Technologies being the survivor and immediately changing its name
to Pioneer-Standard of Maryland, Inc.
The term "Merger Agreement" shall mean that certain Plan and Agreement
of Merger among the Company, Pioneer/Maryland, Pioneer/Technologies, the
shareholders identified on the signature pages thereof and Xxxxx X.
Xxxxxx, as shareholder representative, pursuant to which the Merger will
occur.
The term "Pioneer/Canada" shall mean Pioneer-Standard Canada Inc., a
corporation organized under the laws of the Province of Ontario.
The term "Pioneer/Maryland" shall mean Pioneer-Standard of Maryland,
Inc., a Maryland corporation.
The term "Restricted Subsidiary Guaranty" shall mean any Guaranty by
a Restricted Subsidiary of the Indebtedness of (a) the Company or (b)
another Restricted Subsidiary.
The term "Substantial Portion" shall have the meaning set forth in
Article I of the Credit Agreement.
The terms "Maryland Guarantee" and "Canada Guarantee" shall mean the
guaranty agreements executed and delivered by Pioneer-Standard of
Maryland, Inc., as successor in interest to Pioneer/Technologies, and
Pioneer/Canada, respectively, in each case in favor of the Noteholders.
SECTION 3. CONDITIONS TO EFFECTIVENESS OF THIS AMENDMENT.
This Amendment shall not be effective unless and until the following
conditions shall have been satisfied or waived:
Section 3.1. OPINIONS OF COUNSEL FOR THE COMPANY. The Noteholder and its
special counsel shall have received from each of (a) Xxxxxx, Halter &
Xxxxxxxx, Cleveland, Ohio, special United States counsel for the Company and
(b) Blake, Xxxxxxx & Xxxxxxx, special Canada counsel for the Company, an
opinion, dated the date hereof, in form and substance satisfactory to the
Noteholder and its special counsel, collectively relating to the Merger, the
due authorization, execution and delivery by the Company, Pioneer/Technologies
and Pioneer/Canada of this Amendment, the Maryland Guarantee and the Canada
Guarantee,
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respectively, and the enforceability against the Company, Pioneer/Technologies
and Pioneer/Canada of this Amendment, the Maryland Guarantee and the Canada
Guarantee, respectively, in accordance with their respective terms.
Section 3.2. CREDIT AGREEMENT. The Credit Agreement and all other
documents, certificates or instruments delivered pursuant thereto shall have
been reduced to writing and furnished to the Noteholder and its special
counsel, and the Credit Agreement and such other documents, certificates and
instruments shall be in form and substance satisfactory to the Noteholder and
its special counsel. The Noteholder shall have received an Officer's
Certificate of the Company certifying that attached thereto are true, correct
and complete copies of a fully executed Credit Agreement and such other
documents, certificates and instruments, that such documents are the only
agreements between such parties relating to the transactions contemplated by
the Credit Agreement, that each such document is in full force and effect
without any term or condition thereof having been amended, modified or waived,
that there is no default thereunder and that each of the conditions set forth
in Section 3.1 of the Credit Agreement have been satisfied (without any thereof
having been waived).
Section 3.3. MERGER AGREEMENT. The Merger Agreement and all other
documents, certificates or instruments delivered pursuant thereto shall have
been reduced to writing and furnished to the Noteholder and its special
counsel, and the Merger Agreement and such other documents, certificates and
instruments shall be in form and substance satisfactory to the Noteholder and
its special counsel. The Noteholder shall have received an Officer's
Certificate of the Company certifying that attached thereto are true, correct
and complete copies of the fully executed Merger Agreement and such other
documents, certificates and instruments, that such documents are the only
agreements between such parties relating to the transactions contemplated by
the Merger Agreement or the business or assets of the Company, that each such
document is in full force and effect without any term or condition thereof
having been amended, modified or waived, that there is no default thereunder
and that all conditions precedent to the effectiveness of the Merger set forth
in the Merger Agreement shall have been satisfied (without any thereof having
been waived). The Merger shall have been consummated and the Company shall own
100% of the stock of Pioneer/Technologies.
Section 3.4 THE GUARANTEES. The Maryland Guarantee and the Canada
Guarantee each shall have been duly executed and delivered and shall constitute
the legal, valid and binding obligations of the obligor thereunder, enforceable
in accordance with its terms.
SECTION 4. MISCELLANEOUS.
Section 4.1. CROSS-REFERENCES. References in this Amendment to any
Section are, unless otherwise specified, to such Section of this Amendment.
Section 4.2. INSTRUMENT PURSUANT TO PURCHASE AGREEMENT. This Amendment is
executed pursuant to Section 13.4 of the Purchase Agreement and shall (unless
otherwise expressly indicated herein) be construed, administered and applied in
accordance with all of the terms and provisions of the Purchase Agreement.
Except as expressly amended hereby, all of the
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representations, warranties, terms, covenants and conditions of the Purchase
Agreement and the Notes shall remain unamended and unwaived. The amendments set
forth herein shall be limited precisely as provided for herein to the
provisions expressly amended herein and shall not be deemed to be a waiver of,
amendment of, consent to or modification of any other term or provision of the
Purchase Agreement or the Notes or of any term or provision of any other
document or of any transaction or further action on the part of the Company
which would require the consent of any Noteholder under the Purchase Agreement.
Section 4.3. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns.
Section 4.4. COUNTERPARTS. This Amendment may be executed simultaneously
in two or more counterparts, each of which shall be deemed to be an original
but all of which shall constitute together but one and the same instrument.
Section 4.5. GOVERNING LAW. This Amendment shall be governed by and
construed in accordance with the law of the State of New York.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers duly authorized thereunto as of the date
and year first above written.
PIONEER-STANDARD ELECTRONICS, INC.
By: /S/ Xxxx X. Looga
-------------------
Name: Xxxx X. Looga
Title: Vice President, Treasurer
TEACHERS INSURANCE AND ANNUITY
ASSOCIATION OF AMERICA
By: /S/ Xxxxx X. Xxxxxxxxx
-----------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Managing Director - Private
Placements
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