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Exhibit 10(i)
PIONEER-STANDARD FINANCIAL TRUST
---------
6 3/4% Convertible Trust Preferred Securities
REGISTRATION RIGHTS AGREEMENT
New York, New York
March 23, 1998
LAZARD FRERES & CO. LLC
▇▇▇▇▇▇ GULL ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ INC.
▇▇▇▇▇▇▇▇ & COMPANY SECURITIES, INC.
c/o Lazard Freres & Co. LLC
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Pioneer-Standard Financial Trust, a statutory business trust
created under the laws of the State of Delaware (the "Trust"), and
Pioneer-Standard Electronics, Inc., an Ohio corporation (the "Company"), as
depositor of the Trust and as guarantor propose to issue and sell to Lazard
Freres & Co. LLC, ▇▇▇▇▇▇ Gull ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Inc. and ▇▇▇▇▇▇▇▇ & Company
Securities, Inc. (collectively, the "Initial Purchasers"), upon the terms set
forth in the purchase agreement of even date herewith (the "Purchase
Agreement"), 2,500,000 (plus an additional 375,000 to cover over-allotments, if
any) of its 6 3/4% Convertible Trust Preferred Securities (liquidation
preference $50 per preferred security) (the "Preferred Securities") of the Trust
(the "Offering"). The Preferred Securities are guaranteed on a subordinated
basis by the Company as to the payment of distributions, and as to payments on
liquidation or redemption, to the extent set forth in a guarantee agreement (the
"Guarantee") between the Company and Wilmington Trust Company, a Delaware state
chartered bank, as trustee, and may be converted or exchanged under certain
circumstances into the 6 3/4% Junior Convertible Subordinated Debentures, due
March 31, 2028 of the Company (the "Debentures") held by the Trust and then into
common stock, without par value (together with the associated common share
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purchase rights provided under the Rights Agreement (as defined herein), "Common
Shares"), of the Company. The Preferred Securities, the Debentures, the
Guarantee and the Common Shares issuable upon conversion of the Preferred
Securities and/or the Debentures are referred to collectively as the
"Securities." As an inducement to the Initial Purchasers to enter into the
Purchase Agreement and in satisfaction of a condition to your obligations
thereunder, the Company and the Trust each agree with you, (i) for the benefit
of the Initial Purchasers and (ii) for the benefit of the holders (including the
Initial Purchasers) of the Registrable Securities (as defined herein) until such
time as such Registrable Securities have been sold pursuant to the Shelf
Registration Statement (as defined below) (each of the foregoing a "Holder" and
together the "Holders"), as follows:
1. DEFINITIONS. (a) Capitalized terms used herein without
definition shall have their respective meanings set forth in the Purchase
Agreement. As used in this Agreement, the following capitalized defined terms
shall have the following meanings:
"ACT" means the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"AFFILIATE" of any specified person means any other person
that, directly or indirectly, is in control of, is controlled by, or is under
common control with, such specified person. For purposes of this definition,
control of a person means the power, direct or indirect, to direct or cause the
direction of the management and policies of such person whether by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"COMMISSION" means the Securities and Exchange Commission.
"DTC" means The Depository Trust Company.
"EFFECTIVE TIME" means the date on which the Commission
declares the Shelf Registration Statement
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effective or on which the Shelf Registration Statement otherwise becomes
effective.
"ELECTING HOLDER" has the meaning assigned thereto in Section
3(a)(3) hereof.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated thereunder.
"HOLDER" has the meaning set forth in the preamble hereto.
"INDENTURE" means the Junior Subordinated Indenture dated
March 23, 1998, and the First Supplemental Indenture dated March 23, 1998,
relating to the Debentures, each entered or to be entered into by the Company
and Wilmington Trust Company, as trustee, as the same may be amended from time
to time in accordance with the terms thereof.
"INITIAL CLOSING DATE" has the meaning set forth in the
Purchase Agreement.
"MAJORITY HOLDERS" means, in any particular Underwritten
Offering, the Holders of a majority of the aggregate principal amount of the
Registrable Securities registered under a Shelf Registration Statement and
participating in such Underwritten Offering; PROVIDED, THAT, Holders of Common
Shares issued upon conversion of Preferred Securities shall be deemed to be
Holders of the aggregate principal amount of Preferred Securities from which
such Common Shares were converted.
"MANAGING UNDERWRITERS" means the investment banker or
investment bankers and manager or managers that shall administer an Underwritten
Offering of the securities covered by the Shelf Registration Statement.
"NOTICE AND QUESTIONNAIRE" means a Notice of Registration
Statement and Selling Security Holder Questionnaire substantially in the form of
Exhibit A hereto.
"OFFERING MEMORANDUM" has the meaning set forth in the
Purchase Agreement.
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"PERSON" means a corporation, association, partnership,
limited liability company, organization, business, individual, trust,
unincorporated organization, or a government or agency or political subdivision
thereof.
"PROSPECTUS" means the prospectus included in any Shelf
Registration Statement (including, without limitation, a prospectus that
discloses information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A under the Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Securities covered by such
Shelf Registration Statement, and all amendments and supplements to the
Prospectus, including post-effective amendments.
"PURCHASE AGREEMENT" means the purchase agreement dated March
17, 1998 among the Purchaser, the Company and the Trust.
"INITIAL PURCHASERS" means Lazard Freres & Co. LLC, ▇▇▇▇▇▇
Gull ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Inc. and ▇▇▇▇▇▇▇▇ & Company Securities, Inc.
"REGISTRABLE SECURITIES" means all or any portion of the
Securities issued from time to time; PROVIDED, HOWEVER, that a Security ceases
to be a Registrable Security when it is no longer a Restricted Security.
"RESTRICTED SECURITY" means any Security except any such
Security which (i) has been effectively registered under the Securities Act and
sold in a manner contemplated by the Shelf Registration Statement, (ii) has been
transferred in compliance with Rule 144 under the Securities Act (or any
successor provision thereto) or is transferable pursuant to paragraph (k) of
such Rule 144 (or any successor provision thereto), (iii) has been sold in
compliance with Regulation S under the Securities Act (or any successor thereto)
and does not constitute the unsold allotment of a distributor within the meaning
of Regulation S under the Securities Act, or (iv) has otherwise been transferred
and a new Security not subject to transfer restrictions under the Securities Act
has been delivered by or on behalf of the
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Company in accordance with the terms of the Trust Agreement or the Indenture, as
the case may be.
"RIGHTS AGREEMENT" means the Rights Agreement dated as of
April 25, 1989 between the Company and National City Bank, Cleveland, Ohio, and
any successor or replacements thereof.
"RULES AND REGULATIONS" means the published rules and
regulations of the Commission promulgated under the Securities Act or the
Exchange Act, as in effect at any relevant time.
"SECURITIES" has the meaning set forth in the preamble hereto.
"SHELF REGISTRATION" means a registration effected pursuant to
Section 2 hereof.
"SHELF REGISTRATION PERIOD" has the meaning set forth in
Section 2(b) hereof.
"SHELF REGISTRATION STATEMENT" means a "shelf" registration
statement of the Company pursuant to the provisions of Section 2 hereof which
covers some or all of the Registrable Securities, as applicable, on an
appropriate form under Rule 415 under the Act or any similar rule that may be
adopted by the Commission, and all amendments and supplements to such
registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"TRUST AGREEMENT" means the Trust Agreement, dated as of March
23, 1998, among the Company, as Depositor, Wilmington Trust Company, as Property
Trustee and as Delaware Trustee, and the Administrative Trustees named therein,
relating, among other things, to the Preferred Securities, as amended and
supplemented from time to time in accordance with its terms.
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939,
or any successor thereto, and the rules, regulations and forms promulgated
thereunder, as the same shall be amended.
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"UNDERWRITER" means any underwriter of Registrable Securities
in connection with an offering thereof under a Shelf Registration Statement.
"UNDERWRITTEN OFFERING" means an underwritten offering of at
least ten percent (10%) in aggregate principal amount of the outstanding
Registrable Securities.
(b) Wherever there is a reference in this Agreement to a
percentage of the "principal amount" of Registrable Securities or to a
percentage of Registrable Securities, the Preferred Securities and the
Debentures issuable upon exchange of the Preferred Securities will be treated as
the same class of Securities and Common Shares shall be treated as representing
the liquidation preference of Preferred Securities or the principal amount of
Debentures which was surrendered for conversion in order to receive such number
of Common Shares.
2. SHELF REGISTRATION; SUSPENSION OF USE OF PROSPECTUS.
(a) The Company and the Trust shall prepare and, not later
than 90 days following the Initial Closing Date, file with the Commission and
thereafter, but not later than 180 days following the Initial Closing Date,
shall each use their best efforts to cause to be declared effective under the
Act, a Shelf Registration Statement relating to the offer and sale of the
Registrable Securities; PROVIDED, HOWEVER, that no Holder shall be entitled to
be named as a selling security holder in the Shelf Registration Statement or to
use the Prospectus forming a part thereof for resales of Registrable Securities
unless such Holder is an Electing Holder.
(b) The Company and the Trust shall each use its respective
best efforts to keep the Shelf Registration Statement continuously effective in
order to permit the Prospectus forming part thereof to be usable by Electing
Holders for a period of two years from the Initial Closing Date (or, in the
event that Rule 144(k) under the Securities Act is amended to provide for a
shorter holding period, until the end of such shorter period) or such shorter
period that will terminate when (A) all the Preferred Securities
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covered by the Shelf Registration Statement have been sold pursuant to the Shelf
Registration Statement; (B) all Debentures issued to Holders in respect of
Preferred Securities that have not been sold pursuant to the Shelf Registration
Statement have been sold pursuant to the Shelf Registration Statement; and (C)
all Common Shares issued upon conversion of any such Preferred Securities or any
such Debentures that have not been sold pursuant to the Shelf Registration
Statement have been sold pursuant to the Shelf Registration Statement (in any
such case, such period being called the "Shelf Registration Period"). The
Company and the Trust shall be deemed not to have used each of its respective
best efforts to keep the Shelf Registration Statement effective during the
requisite period if the Company or the Trust voluntarily takes any action that
would result in Electing Holders of Registrable Securities covered thereby not
being able to offer and sell such Registrable Securities during that period,
unless such action is (i) required by applicable law or (ii) pursuant to Section
2(e) hereof, and, in either case, so long as the Company and the Trust promptly
thereafter complies with the requirements of Section 3(j) hereof, if applicable.
(c) The Company and the Trust shall each use its respective
best efforts, after the Effective Time of the Shelf Registration Statement and
prior to the end of the Shelf Registration Period, promptly upon the request of
any Holder that is not then an Electing Holder identified as a selling security
holder in the Prospectus at the Effective Time, to take any action reasonably
necessary to enable such Holder to use the Prospectus forming a part thereof for
resales of Registrable Securities, including, without limitation, any action
necessary to identify such Holder as a selling security holder in the Shelf
Registration Statement; PROVIDED, HOWEVER, that nothing in this subparagraph
shall relieve such Holder of the obligation to return a completed and signed
Notice and Questionnaire to the Company and the Trust in accordance with Section
3(a)(2) hereof and to provide to the Company and the Trust, in writing, any
information with respect to such Holder or the Registrable Securities held by
such Holder as is, in the reasonable opinion of counsel to the Trust or the
Company, required under applicable law to enable such Holder to use such
Prospectus for resales of such Registrable Securities.
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(d) If at any time prior to the end of the Shelf Registration
Period, the Preferred Securities are convertible into securities other than
Common Shares, the Company and the Trust shall each use its respective best
efforts, or shall cause any successor under the Trust Agreement to, cause such
securities to be included in the Shelf Registration Statement no later than the
date on which the Preferred Securities may first be converted into such
securities.
(e) The Company and the Trust may suspend the use of the
Prospectus for a period not to exceed 30 days in any three month period or four
periods not to exceed an aggregate of 60 days in any 12 month period for valid
business reasons (not including avoidance of the Company's or the Trust's
obligations hereunder), including the acquisition or divestiture of assets,
public filings with the Commission, pending corporate developments and similar
events. Any such period during which the Company and the Trust are permitted to
suspend the effectiveness of the Shelf Registration Statement is referred to
herein as the "Suspension Period."
(f) If (i) on or prior to the date 90 days after the Initial
Closing Date, a Shelf Registration Statement has not been filed with the
Commission or (ii) on or prior to the date 180 days after the Initial Closing
Date such Shelf Registration Statement has not been declared effective (each
such event, a "Registration Default"), additional interest ("Liquidated
Damages") will accrue on the Debentures, and, accordingly, additional
distributions will accrue on the Preferred Securities, from and including the
day following such Registration Default until the earlier of such date as the
Shelf Registration Statement is filed or declared effective, as the case may be,
or the end of the Shelf Registration Period. Liquidated Damages will be paid
quarterly in arrears (subject to the Company's right to defer the payment of
Liquidated Damages during any Extension Period (as defined in the Indenture)),
with the first quarterly payment due on the first interest or distribution
payment date, as applicable, following the date on which such Liquidated Damages
begin to accrue, and will accrue at a rate per annum equal to an additional
one-quarter of one percent (0.25%) of the principal amount or liquidation
preference, as applicable, to and including the 90th day following such
Registration Default and one-half of one
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percent (0.50%) thereof from and after the 91st day following such Registration
Default. In the event that the Shelf Registration Statement ceases to be
effective during the Shelf Registration Period for more than 90 days, whether or
not consecutive, during any 12-month period, then the interest rate borne by the
Debentures and the distribution rate borne by the Preferred Securities will each
increase by an additional one-half of one percent (0.50%) per annum from the
91st day of the applicable 12-month period during which such Shelf Registration
Statement ceases to be effective until such time as the earlier to occur of the
Shelf Registration Statement again becoming effective and the end of the Shelf
Registration Period.
3. REGISTRATION PROCEDURES. In connection with any Shelf
Registration Statement, the following provisions shall apply:
(a) (1) The Company and the Trust shall not be required to
take any action to name such Holder as a selling security holder in the Shelf
Registration Statement or to enable such Electing Holder to use the Prospectus
forming a part thereof for resales of Registrable Securities until such Holder
has returned a completed and signed Notice and Questionnaire to the Company and
the Trust and provided to the Company and the Trust such information with
respect to such Holder or the Registrable Securities held by such Holder as is,
in the reasonable opinion of counsel to the Company or the Trust, required to
enable such Holder to use the Prospectus for resales of Registrable Securities.
(2) Not less than 40 calendar days prior to the Effective Time
of the Shelf Registration Statement, the Company or the Trust shall
mail the Notice and Questionnaire to each Holder. No Holder shall be
entitled to be named as a selling security holder in the Shelf
Registration Statement as of the Effective Time, and no Holder shall be
entitled to use the Prospectus forming a part thereof for resales of
Registrable Securities at any time, unless such Holder has returned a
completed and signed Notice and Questionnaire to the Company and the
Trust and provided to the Company and the Trust such information with
respect to such Holder of the Registrable Securities held by such
Holder as is, in the reasonable opinion of
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counsel to the Company or the Trust, required to enable such Holder to
use the Prospectus for resales of Registrable Securities; PROVIDED,
HOWEVER, that only Holders who have completed and returned the Notice
and Questionnaire and any such additional information requested of such
Holder to the Company or the Trust on or before the day that is ten
days prior to the Effective Time shall be entitled to be named as a
selling security holder in the Shelf Registration Statement as of the
Effective Time.
(3) The term "Electing Holder" shall mean any Holder that has
returned a completed and signed Notice and Questionnaire to the Company
in accordance with Section 3(a)(1) or 3(a)(2) hereof and provided to
the Company and the Trust such information with respect to such Holder
or the Registrable Securities held by such Holder as is, in the
reasonable opinion of counsel to the Company or the Trust, required to
enable such Holder to use the Prospectus for resales of Registrable
Securities.
(b) The Company and the Trust shall furnish to each Electing
Holder for such Electing Holder's timely review, prior to the filing thereof
with the Commission, a copy of any Shelf Registration Statement, and shall
furnish to such Electing Holders each amendment thereof and each amendment or
supplement, if any, to the Prospectus included therein and shall use their best
efforts to reflect in each such document, when so filed with the Commission,
such comments as such Electing Holders reasonably may propose.
(c) The Company and the Trust shall ensure that (i) any Shelf
Registration Statement and any amendment thereto and any Prospectus forming part
thereof and any amendment or supplement thereto complies in all material
respects with the Act, (ii) any Shelf Registration Statement and any amendment
thereto does not, when it becomes effective, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) any Prospectus
forming part of any Shelf Registration Statement, and any amendment or
supplement to such Prospectus, does not include an untrue statement of a
material fact or omit to state a material fact necessary in
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order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(d)(1) The Company shall advise the Initial Purchasers, and in
the case of clause (i), the Electing Holders and, if requested by the Initial
Purchasers or any such Electing Holder, confirm such advice in writing:
(i) when a Shelf Registration Statement and any
amendment thereto has been filed with the Commission and when
the Shelf Registration Statement or any post-effective
amendment thereto has become effective; and
(ii) of any request by the Commission for amendments
or supplements to the Shelf Registration Statement or the
Prospectus included therein or for additional information.
(2) The Company shall advise the Initial Purchasers and the
Electing Holders and, if requested by the Initial Purchasers or any
such Electing Holder, confirm such advice in writing:
(i) of the issuance by the Commission of any stop
order suspending the effectiveness of the Shelf Registration
Statement or the initiation of any proceedings for that
purpose;
(ii) of the receipt by the Company or the Trust of
any notification with respect to the suspension of the
qualification of the securities included in any Shelf
Registration Statement for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose;
and
(iii) of the suspension of the use of the Prospectus
pursuant to Section 2(e) hereof or of the happening of any
event that requires the making of any changes in the Shelf
Registration Statement or the Prospectus so that, as of such
date, the statements therein are not misleading and do not
omit to state a material fact required to be stated therein or
necessary to make the
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statements therein (in the case of the Prospectus, in light of
the circumstances under which they were made) not misleading
(which advice shall be accompanied by an instruction to
suspend the use of the Prospectus until the requisite changes
have been made); PROVIDED, THAT, such notice of the suspension
of the use of the Prospectus pursuant to Section 2(e) hereof
shall not be required to specify the nature of the event
giving rise to the notice requirement hereunder.
(e) The Company and the Trust shall each use its respective
best efforts to obtain the withdrawal of any order suspending the effectiveness
of any Shelf Registration Statement at the earliest possible time.
(f) The Company and the Trust shall furnish to each Electing
Holder of Registrable Securities included within the coverage of any Shelf
Registration Statement, without charge, at least one copy of such Shelf
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules, and, if the Electing Holder so requests in
writing, all exhibits (including those incorporated by reference).
(g) The Company and the Trust shall, during the Shelf
Registration Period, deliver to each Electing Holder of Registrable Securities
included within the coverage of any Shelf Registration Statement, without
charge, as many copies of the Prospectus (including each preliminary Prospectus)
included in such Shelf Registration Statement and any amendment or supplement
thereto as such Electing Holder may reasonably request; and the Company and the
Trust each consents to the use, in compliance with the terms of this Agreement,
of the Prospectus or any amendment or supplement thereto by each of the Electing
Holders of Registrable Securities in connection with the offering and sale of
the Registrable Securities covered by the Prospectus or any amendment or
supplement thereto.
(h) Prior to any offering of Registrable Securities pursuant
to any Shelf Registration Statement, the Company and the Trust shall register or
qualify or cooperate with the Electing Holders of Registrable Securities
included therein and their respective counsel in connection with the
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registration or qualification of such securities for offer and sale under the
securities or blue sky laws of such U.S. jurisdictions as any such Electing
Holders reasonably request in writing and do any and all other acts or things
necessary or advisable to enable the offer and sale in such jurisdictions of the
Registrable Securities covered by such Shelf Registration Statement; PROVIDED,
HOWEVER, that neither the Company nor the Trust will be required to qualify
generally to do business in any jurisdiction where it is not then so qualified
or to take any action which would subject it to general service of process or to
taxation in any such jurisdiction where it is not then so subject.
(i) Unless any Registrable Securities shall be in book-entry
only form, the Company and the Trust shall cooperate with the Electing Holders
of Registrable Securities to facilitate the timely preparation and delivery of
certificates representing the Registrable Securities to be sold pursuant to any
Shelf Registration Statement free of any restrictive legends and in such
denominations and registered in such names as Electing Holders may request prior
to sale of Registrable Securities pursuant to such Shelf Registration Statement.
(j) Upon the occurrence of any event contemplated by paragraph
(d)(2)(iii) above, the Company and the Trust shall, if required pursuant to the
Act or paragraph (d)(2)(iii) above, promptly prepare a post-effective amendment
to any Shelf Registration Statement or an amendment or supplement to the related
Prospectus or file any other required document so that, as thereafter delivered
to purchasers of the securities included therein, the Prospectus will not
include an 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.
(k) Not later than the effective date of any Shelf
Registration Statement hereunder, the Company and the Trust shall each provide a
CUSIP number for the Preferred Securities registered under such Shelf
Registration Statement; in the event of and at the time of any distribution of
the Debentures to Holders, the Company and the Trust shall provide a CUSIP
number for the Debentures
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and provide the applicable trustee with printed certificates for such
Registrable Securities, in a form eligible for deposit with DTC.
(l) The Company shall use its best efforts to comply with all
applicable Rules and Regulations and shall make generally available to its
security holders as soon as practicable after the effective date of the
applicable Shelf Registration Statement an earnings statement satisfying the
provisions of Section 11(a) of the Act (which may be satisfied in the manner
provided by Rule 158 under the Act).
(m) The Company and the Trust shall cause the Indenture, the
Trust Agreement and the Guarantee to be qualified under the Trust Indenture Act
in a timely manner.
(n) The Company and the Trust shall, if requested, promptly
incorporate in a Prospectus supplement or post-effective amendment to a Shelf
Registration Statement, such information as the Managing Underwriters and/or
Majority Holders reasonably agree should be included therein and shall make all
required filings of such Prospectus supplement or post-effective amendment as
soon as notified of the matters to be incorporated in such Prospectus supplement
or post-effective amendment.
(o) The Company and the Trust shall enter into such agreements
including, in connection with an Underwritten Offering, underwriting agreements)
and take all other appropriate actions in order to expedite or facilitate the
registration or the disposition of the Registrable Securities and in connection
therewith, if an underwriting agreement is entered into, cause the same to
contain indemnification provisions and procedures no less favorable than those
set forth in Section 6 (or such other provisions and procedures acceptable to
the Majority Holders and the Managing Underwriters, if any), with respect to all
parties to be indemnified pursuant to Section 6 from Holders of Registrable
Securities.
(p) The Company and the Trust shall (i) make reasonably
available for inspection by the Electing Holders, any Underwriter, and any
attorney, accountant or other agent retained by the Electing Holders or any such
Underwriter all relevant financial and other records, pertinent corporate
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documents and properties of the Company and its subsidiaries and the Trust in
connection with such Shelf Registration Statement as is customary for similar
due diligence examinations; (ii) cause the officers, directors and employees of
the Company and the Trust to supply all relevant information reasonably
requested by the Holders participating in such Underwritten Offering or any such
Underwriter, attorney, accountant or agent in connection with such Shelf
Registration Statement as is customary for similar due diligence examinations;
PROVIDED, HOWEVER, that any information that is designated in writing by the
Company or the Trust, in good faith, as confidential at the time of delivery of
such information shall be kept confidential by such Holders or any such
Underwriter, attorney, accountant or agent, unless disclosure thereof is made in
connection with a court proceeding or required by law, or such information has
become available (not in violation of this agreement) to the public generally or
through a third party without an accompanying obligation of confidentiality, and
the Company and the Trust shall each be entitled to request that such Holders
sign a confidentiality agreement to the foregoing effect; (iii) in connection
with an Underwritten Offering, make such representations and warranties to the
Electing Holders of Registrable Securities participating in such Underwritten
Offering and the Underwriters in form, substance and scope as are customarily
made by issuers to underwriters in primary underwritten offerings and covering
matters including, but not limited to, those set forth in the Purchase
Agreement; (iv) in connection with an Underwritten Offering, obtain opinions of
counsel to the Company and the Trust and updates thereof (which counsel and
opinions (in form, scope and substance) shall be reasonably satisfactory to the
Managing Underwriters, if any) addressed to each Holder participating in such
Underwritten Offering and the Underwriters covering such matters as are
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by such Holders and Underwriters;
(v) in connection with an Underwritten Offering, obtain "cold comfort" letters
and updates thereof from the independent certified public accountants of the
Company and the Trust (and, if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any business acquired by the
Company for which financial statements and financial data are, or are required
to be,
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included in the Shelf Registration Statement), addressed to each Holder
participating in such Underwritten offering and the Underwriters, if any, in
customary form and covering matters of the type customarily covered in "cold
comfort" letters in connection with primary underwritten offerings; and (vi) in
connection with an Underwritten Offering, deliver such documents and
certificates as may be reasonably requested by the Majority Holders and the
Managing Underwriters, if any, including those to evidence compliance with
section 3(j) and with any customary conditions contained in the underwriting
agreement or other agreement entered into by the Company and the Trust. The
foregoing actions set forth in clauses (iii), (iv), (v) and (vi) of this Section
3(p) shall be performed at (A) the effectiveness of such Shelf Registration
Statement and each post-effective amendment thereto and (B) each closing under
any underwriting or similar agreement as and to the extent required thereunder.
(q) The Company and the Trust shall each use reasonable best
efforts to take all other steps necessary to effect the registration, offering
and sale of the Registrable Securities covered by the Shelf Registration
Statement contemplated hereby.
4. AGREEMENT OF HOLDERS REGARDING USE OF PROSPECTUS. Each
Electing Holder of Registrable Securities covered by a Shelf Registration
Statement severally agrees with the Company and the Trust that such Electing
Holder will not use the Prospectus, in each case after notice by the Company and
the Trust of the applicable event, (i) during any period of suspension referred
to in Section 2(e), (ii) during any period when a stop order is in effect as
referred to in Section 3(d)(2)(i), (iii) in the applicable jurisdiction during
any period when the qualification of the Securities included in the Shelf
Registration Statement has been suspended in such jurisdiction, as referred to
in Section 3(d)(2)(ii), and (iv) during any suspension period referred to in
Section 3(d)(2)(iii).
5. REGISTRATION EXPENSES. The Company and the Trust shall each
bear all expenses incurred in connection with the performance of its obligations
under Sections 2 and 3 hereof and, in connection with an Underwritten Offering,
17
shall reimburse the Electing Holders for the reasonable and duly documented fees
and disbursements of one firm or counsel designated by the Majority Holders to
act as counsel for the Electing Holders in connection therewith.
6. INDEMNIFICATION AND CONTRIBUTION. (a) In connection with
any Shelf Registration Statement, the Company and the Trust, jointly and
severally, agree to indemnify and hold harmless each Initial Purchaser and each
Electing Holder, the directors, officers, employees and agents of each Initial
Purchaser and each such Electing Holder and each person who controls an Initial
Purchaser or any such Electing Holder within the meaning of either the Act or
the Exchange Act against any and all losses, claims, damages or liabilities,
joint or several, to which they or any of them may become subject under the Act,
the Exchange Act or other federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in the Shelf
Registration Statement as originally filed or in any amendment thereof, or in
any preliminary Prospectus or Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agrees to reimburse
each such indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or defending any
such loss, claim, damage, liability or action; PROVIDED, HOWEVER, that (i) the
Company and the Trust shall not be liable in any case to the extent that any
such loss, claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in conformity with written information
furnished to the Company or the Trust by or on behalf of any such Electing
Holder or Underwriter or Managing Underwriter specifically for inclusion
therein, (ii) the Company and the Trust shall not be liable to any indemnified
party under this indemnity agreement with respect to any Shelf Registration
Statement or Prospectus to the extent that any such loss, claim, damage or
liability of such indemnified party results from the use of the Prospectus
during a period
18
when the use of the Prospectus has been suspended in accordance with Section
2(e) or Section 3(d)(2)(iii) hereof, PROVIDED, THAT, in each case, the Initial
Purchasers and the Holders received prior notice of such suspension; and (iii)
the Company and the Trust shall not be liable to any indemnified party under
this indemnity agreement in this Section 6(a) with respect to any preliminary
Prospectus to the extent that any such loss, claim, damage or liability of such
indemnified party results from the fact that such indemnified party sold
Registrable Securities to a person as to whom there was not sent or given, at or
prior to the written confirmation of such sale, a copy of the Prospectus or of
the Prospectus as then amended or supplemented in any case where such delivery
is required by the Act, if the loss, claim, damage or liability of such
indemnified party results from an untrue statement or omission of a material
fact contained in the preliminary Prospectus which was corrected in the
Prospectus or in the Prospectus as then amended or supplemented. This indemnity
agreement will be in addition to any liability which the Company and the Trust
may otherwise have.
The Company and the Trust, jointly and severally, also agree
to indemnify or contribute to Losses, as provided in Section 6(d), of any
Underwriters of Registrable Securities registered under a Shelf Registration
Statement, their officers and directors and each person who controls such
Underwriters on substantially the same basis as that of the indemnification of
the Initial Purchasers and the Electing Holders provided in this Section 6(a)
and shall, if requested by any Electing Holder in connection with an
Underwritten Offering, enter into an underwriting agreement reflecting such
agreement, as provided in Section 3(o) hereof.
(b) Each Electing Holder of Registrable Securities covered by
a Shelf Registration Statement (including the Initial Purchasers) severally
agrees to indemnify and hold harmless (i) the Company, (ii) the Trust, (iii)
each of the Company's and the Trust's directors, trustees, agents and officers
who signs such Shelf Registration Statement and (iv) each person who controls
the Company within the meaning of either the Act or the Exchange Act to the same
extent as the foregoing indemnity from the Company to each such Holder, but only
with reference to
19
written information relating to such Holder furnished to the Company by or on
behalf of such Holder specifically for inclusion in the documents referred to in
the foregoing indemnity. This indemnity agreement will be in addition to any
liability which any such Holder may otherwise have.
(c) Promptly after receipt by an indemnified party under this
Section 6 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying party
under this Section 6, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
PROVIDED, HOWEVER, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party's election to appoint
counsel to represent the indemnified party in an action, the indemnified party
shall have the right to employ separate counsel (including local counsel), in
each case, reasonably satisfactory to the indemnifying party, and the
indemnifying party shall bear the reasonable fees, costs and expenses of such
separate counsel (and local counsel), if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such counsel
with a conflict of interest, (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, (iii) the
20
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after notice of the institution of such action or (iv) the indemnifying
party shall authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a)
or (b) of this Section 6 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, then each applicable indemnifying party, in
lieu of indemnifying such indemnified party, shall have a joint and several
obligation to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively "Losses") to which such
indemnified party may be subject in such proportion as is appropriate to reflect
the relative benefits received by such indemnifying party, on the one hand, and
such indemnified party, on the other hand, from the Offering and the Shelf
Registration Statement which resulted in such Losses; PROVIDED, HOWEVER, that in
no case shall any Initial Purchaser or any subsequent Holder of any Registrable
Securities be responsible, in the aggregate, for any amount in excess of the
purchase discount or commission applicable to such Registrable Securities, as
set forth on the cover page of the Prospectus, nor shall any Underwriter be
responsible for any amount in excess of the underwriting discount or commission
applicable to the securities purchased by such Underwriter under the Shelf
Registration Statement which resulted in such Losses. If the allocation provided
by the immediately preceding sentence is unavailable for any reason, the
indemnifying party and the indemnified party shall contribute in such proportion
as is
21
appropriate to reflect not only such relative benefits but also the relative
fault of such indemnifying party, on the one hand, and such indemnified party,
on the other hand, in connection with the statements or omissions which resulted
in such Losses as well as any other relevant equitable considerations. Benefits
received by the Company and the Trust shall be deemed to be equal to the total
net proceeds from the Offering (before deducting expenses) as set forth on the
cover page of the final Offering Memorandum. Benefits received by each Initial
Purchaser shall be deemed to be equal to the total compensation paid by the
Company to each Initial Purchaser as set forth on the cover page of the Offering
Memorandum, and benefits received by any other Holders shall be deemed to be
equal to the value of receiving Registrable Securities registered under the Act.
Benefits received by any Underwriter shall be deemed to be equal to the total
underwriting discounts and commissions, as set forth on the cover page of the
Prospectus forming a part of the Shelf Registration Statement which resulted in
such Losses. Relative fault shall be determined by reference to whether any
alleged untrue statement or omission relates to information provided by the
indemnifying party, on the one hand, or by the indemnified party, on the other
hand. The parties agree that it would not be just and equitable if contribution
were determined by pro rata allocation or any other method of allocation which
does not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this paragraph (d), 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. For purposes of this Section 6, each person who
controls a Holder within the meaning of either the Act or the Exchange Act and
each director, officer, employee and agent of such Holder shall have the same
rights to contribution as such Holder, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Shelf Registration Statement and each director
of the Company shall have the same rights to contribution as the Company,
subject in each case to the applicable terms and conditions of this paragraph
(d).
22
(e) The provisions of this Section 6 will remain in full force
and effect, regardless of any investigation made by or on behalf of any Holder,
the Company or the Trust or any of the officers, directors or controlling
persons referred to in Section 5 hereof, and will survive the sale by a Holder
of securities covered by a Shelf Registration Statement.
7. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. The Company and the Trust have
not, as of the date hereof, entered into, nor shall it, on or after the date
hereof, enter into, any agreement with respect to its securities that is
inconsistent with the rights granted to the Holders herein or otherwise
conflicts with the provisions hereof.
(b) AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, qualified,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the Company and the Trust have
obtained the written consent of the Holders of at least a majority of the then
outstanding aggregate principal amount of Registrable Securities that has not
yet been sold pursuant to a Shelf Registration Statement; PROVIDED, THAT, with
respect to any matter that directly or indirectly affects the rights of the
Initial Purchasers hereunder, the Company and the Trust shall obtain the written
consent of Lazard Freres & Co. LLC against which such amendment, qualification,
supplement, waiver or consent is to be effective. Notwithstanding the foregoing
(except the foregoing proviso), a waiver or consent to departure from the
provisions hereof with respect to a matter that relates exclusively to the
rights of Holders whose Registrable Securities are being sold pursuant to a
Shelf Registration Statement and that does not directly or indirectly affect the
rights of other Holders may be given by the Majority Holders, determined on the
basis of Registrable Securities being sold rather than registered under such
Shelf Registration Statement.
(c) NOTICES. All notices and other communications provided for
or permitted hereunder shall be
23
made in writing by hand-delivery, first-class mail, telex, telecopier, or air
courier guaranteeing overnight delivery:
(1) if to a Holder, at the most current address given by such
Holder to the Company in accordance with the provisions of this Section
6(c), which address initially is, with respect to each Holder, the
address of such Holder maintained by the Registrar under the Indenture,
with a copy in like manner to Lazard Freres & Co. LLC;
(2) if to the Initial Purchasers, initially at the address set
forth in the Purchase Agreement; and
(3) if to the Company or the Trust, initially at its address
set forth in the Purchase Agreement.
All such notices and communications shall be deemed to have
been duly given when received.
The Initial Purchasers or the Company and the Trust by notice
to the other may designate additional or different addresses for
subsequent notices or communications.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including, without the need for an express assignment or any consent by
the Company and the Trust thereto, subsequent Holders of Registrable Securities.
The Company and the Trust hereby agree to extend the benefits of this Agreement
to any Holder of Registrable Securities and any such Holder may specifically
enforce the provisions of this Agreement as if an original party hereto.
(e) COUNTERPARTS. This agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(f) HEADINGS. The headings in this agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
24
(g) GOVERNING LAW. This agreement shall be governed by and
construed in accordance with the internal laws of the State of New York
applicable to agreements made and to be performed in said State.
(h) SEVERABILITY. In the event that any one of more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in any way impaired
or affected thereby, it being intended that all of the rights and privileges of
the parties shall be enforceable to the fullest extent permitted by law.
(i) SECURITIES HELD BY THE COMPANY, ETC. Whenever the consent
or approval of Holders of a specified percentage of principal amount of
Registrable Securities is required hereunder, Registrable Securities held by the
Company or its Affiliates or the Trust (other than subsequent Holders of
Registrable Securities if such subsequent Holders are deemed to be Affiliates
solely by reason of their holdings of such Registrable Securities) shall not be
counted in determining whether such consent or approval was given by the Holders
of such required percentage.
Please confirm that the foregoing correctly sets forth the
agreement between the Company, the Trust and the Initial Purchasers.
25
Very truly yours,
PIONEER-STANDARD ELECTRONICS, INC.
by /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President, Treasurer and
Assistant Secretary
PIONEER-STANDARD FINANCIAL TRUST
by /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Administrative Trustee
Accepted in New York, New York
March 23, 1998
LAZARD FRERES & CO. LLC
▇▇▇▇▇▇ GULL ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ INC.
▇▇▇▇▇▇▇▇ & COMPANY SECURITIES, INC.
By: Lazard Freres & Co. LLC
by /s/ Authorized Officer
-----------------------------
26
EXHIBIT A
PIONEER-STANDARD ELECTRONICS, INC.
PIONEER-STANDARD FINANCIAL TRUST
INSTRUCTION TO DTC PARTICIPANTS
(DATE OF MAILING)
URGENT - IMMEDIATE ATTENTION REQUESTED
DEADLINE FOR RESPONSE: (DATE)
The Depository Trust Company ("DTC") has identified you as a DTC Participant
through which beneficial interests in 6 3/4% Convertible Trust Preferred
Securities (liquidation preference $50 per preferred security) of
Pioneer-Standard Financial Trust (the "Trust") are held. The Preferred
Securities are guaranteed on a subordinated basis by Pioneer-Standard
Electronics, Inc. (the "Company") as to the payment of distributions, and as to
payments on liquidation or redemption, to the extent set forth in a guarantee
agreement between the Company and Wilmington Trust Company, as trustee (the
"Guarantee") and may be exchanged under certain circumstances into 6 3/4% Junior
Convertible Subordinated Debentures due March 31, 2028 of the Company (the
"Debentures") held by the Trust and converted into common shares, without par
value ("Common Shares"), of the Company. The Preferred Securities, the
Debentures, the Guarantee and the Common Shares are referred to collectively as
the "Registrable Securities."
The Company and the Trust are in the process of registering the Registrable
Securities under the Securities Act of 1933 for resale by the beneficial owners
thereof. In order to have their Registrable Securities included in the
registration statement, beneficial owners must complete and return the enclosed
Notice of Registration Statement and Selling Security Holder Questionnaire.
It is important that beneficial owners of the Registrable Securities receive a
copy of the enclosed materials as soon
27
as possible as their rights to have the Registrable Securities included in the
registration statement depend upon their returning the Notice and Questionnaire
by (DEADLINE FOR RESPONSE). Please forward a copy of the enclosed documents to
each beneficial owner that holds interests in the Registrable Securities through
you. If you require more copies of the enclosed materials or have any questions
pertaining to this matter, please contact:
Pioneer-Standard Electronics, Inc.
-----------------------
-----------------------
Attn: Chief Financial Officer
FORM OF
PIONEER-STANDARD ELECTRONICS, INC.
PIONEER-STANDARD FINANCIAL TRUST
NOTICE OF REGISTRATION STATEMENT
AND
SELLING SECURITY HOLDER QUESTIONNAIRE
[DATE]
Pioneer-Standard Electronics, Inc., an Ohio corporation (the
"Company") and Pioneer-Standard Financial Trust, a statutory business trust
formed under the laws of the State of Delaware (the "Trust") have filed with the
United States Securities and Exchange Commission (the "Commission") a
preliminary registration statement on Form S-3 (the "Shelf Registration
Statement") for the registration and resale under Rule 415 of the Securities Act
of 1933, as amended (the "Securities Act"), of the Trust's [ ]% Convertible
Trust Preferred Securities (liquidation preference $50 per preferred security)
(the "Preferred Securities"), the Company's 6 3/4% Junior Convertible
Subordinated Debentures, due March 31, 2028 (the "Debentures"), the guarantee of
the Company pursuant to the Guarantee Agreement between the Company and
Wilmington Trust
28
Company, as trustee (the "Guarantee"), the common shares of the Company, without
par value, issuable upon conversion of the Preferred Securities and/or the
Debentures (together with the associated common share purchase rights (the
"Rights") provided under the Rights Agreement, the "Company Common Shares", and
together with the Preferred Securities, the Debentures and the Guarantee, the
"Registrable Securities"), in accordance with the terms of the Registration
Rights Agreement, dated as of March __, 1998 (the "Registration Rights
Agreement"), among the Trust, the Company, and Lazard Freres & Co. LLC, ▇▇▇▇▇▇
Gull ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Inc. and ▇▇▇▇▇▇▇▇ & Company Securities, Inc. (the
"Initial Purchasers"). A copy of the Registration Rights Agreement is attached
hereto. All capitalized terms not otherwise defined herein shall have the
meanings ascribed thereto in the Registration Rights Agreement.
Each beneficial owner of Registrable Securities is entitled to
have the Registrable Securities beneficially owned by it included in the Shelf
Registration Statement. In order to have Registrable Securities included in the
Shelf Registration Statement, this Notice of Registration Statement and Selling
Security Holder Questionnaire ("Notice and Questionnaire") must be completed,
executed and delivered to the Company's counsel at the address set forth herein
for receipt ON OR BEFORE (DEADLINE FOR RESPONSE). Beneficial owners of
Registrable Securities who do not complete, execute and return this Notice and
Questionnaire by such date (i) will not be named as selling security holders in
the Shelf Registration Statement and related Prospectus and (ii) may not sell
their Registrable Securities pursuant thereto, unless the Company, in its
discretion, consents to include such owner's securities in the Shelf
Registration Statement.
Certain legal consequences arise from being named as a selling
security holder in the Shelf Registration Statement and related Prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own securities law counsel regarding the consequences of being
named or not being named as a selling security holder in the Shelf Registration
Statement and related Prospectus.
29
ELECTION
The undersigned holder (the "Selling Security Holder") of
Registrable Securities hereby elects to include in the Shelf Registration
Statement the Registrable Securities beneficially owned by it and listed below
in Item (3). The undersigned, by signing and returning this Notice and
Questionnaire, agrees to be bound with respect to such Registrable Securities by
the terms and conditions of this Notice and Questionnaire and the Registration
Rights Agreement.
The Selling Security Holder hereby undertakes, in accordance
with Section 6 of the Registration Rights Agreement, (a) to indemnify and hold
harmless (i) the Company, (ii) the Trust, (iii) each of the Company's and the
Trust's directors, trustees, agents and officers who signs the Shelf
Registration Statement and (iv) each person who controls the Company within the
meaning of either the Act or the Exchange Act against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the Act, the Exchange Act or other federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the Shelf Registration Statement as originally filed or in any
amendment thereof, or in any preliminary Prospectus or Prospectus, or in any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or
30
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Shelf Registration Statement as originally filed
or in any amendment thereof, or in any preliminary Prospectus or Prospectus, or
in any amendment thereof or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
provided, that, such Selling Security Holder shall not be liable to any
indemnified party in any case except to the extent that any such loss, claim,
damage or liability of such indemnified party results from written information
relating to such Selling Security Holder furnished to the Company by or on
behalf of such Selling Security Holder specifically for inclusion in the Shelf
Registration Statement as originally filed or any amendment thereof, or in any
preliminary Prospectus or Prospectus, or any amendment thereof or supplement
thereto, and (b) to reimburse each such indemnified party, as incurred, for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action.
The undersigned further undertakes, if applicable, to comply with the provisions
of Sections 6(c) and (d) of the Registration Rights Agreement that are
applicable to the undersigned.
Upon any sale of Registrable Securities pursuant to the Shelf
Registration Statement under the Securities Act, the Selling Security Holder
will be required to deliver to the Company, the Trust and Trustee the Notice of
Transfer set forth in Appendix I attached to this Notice and Questionnaire
(completed and signed) and hereby undertakes to do so.
The Selling Security Holder hereby provides the following
information to the Company and the Trust and represents and warrants that such
information is accurate and complete:
31
QUESTIONNAIRE
(1) (a) Full Legal Name of Selling Security Holder:
-----------------------------------------------------
(b) Full Legal Name of Registered Holder (if not the same as in
(a) above) of Registrable Securities Listed in (3) below:
-----------------------------------------------------
(c) Full Legal Name of DTC Participant (if applicable and if not
the same as (b) above) Through Which Registrable Securities
Listed in (3) Below Are Held:
-----------------------------------------------------
(2) Address for Notices to Selling Security Holder:
---------------------------------------------------
---------------------------------------------------
---------------------------------------------------
Telephone:
---------------------------
Fax:
---------------------------
Contact Person:
---------------------------
(3) Beneficial Ownership of Registrable Securities:
Except as set forth below in this Item (3), the undersigned does not
beneficially own any Securities or Company Common Shares issued upon conversion
of any Securities.
32
(a) Principal amount or liquidation preference of Registrable
Securities (as defined in the Registration Rights Agreement)
beneficially owned:
------------------------
CUSIP No(s). of such Registrable Securities:
----------
Number of Company Common Shares (if any) issued upon
conversion of such Registrable Securities:
------------
(b) Principal amount or liquidation preference of Registrable
Securities which the undersigned wishes to be included in the
Shelf Registration Statement:
----------------
CUSIP No(s). of such Registrable Securities to be included in
the Shelf Registration Statement:
-----------------
Number of Company Common Shares (if any) issued upon
conversion of such Registrable Securities which are to be
included in the Shelf Registration Statement:
---------------
(4) Beneficial Ownership of Other Securities of the Company:
Except as set forth below in this Item (4), the undersigned Selling
Security Holder is not the beneficial or registered owner of any Common Shares
or any other securities of the Company or any of its affiliates, other than the
Registrable Securities listed above in Item (3).
State any exceptions here:
(5) Relationships with the Company:
33
Except as set forth below, neither the Selling Security Holder
nor any of its affiliates, officers, directors or principal equity holders (5%
or more) has held any position or office or has had any other material
relationship with the Company (or its predecessors or affiliates) during the
past three years.
State any exceptions here:
(6) Plan of Distribution:
Except as set forth below, the undersigned Selling Security
Holder intends to distribute the Registrable Securities listed above in Item (3)
only as follows (if at all): Such Registrable Securities may be sold from time
to time directly by the undersigned Selling Security Holder or, alternatively,
through underwriters, broker-dealers or agents. Such Registrable Securities may
be sold in one or more transactions at fixed prices, at prevailing market prices
at the time of sale, at varying prices determined at the time of sale, or at
negotiated prices. Such sales may be effected in transactions (which may involve
crosses or block transactions) (i) on any national securities exchange or
quotation service on which the Registrable Securities may be listed or quoted at
the time of sale, (ii) in the over-the-counter market, (iii) in transactions
otherwise than on such exchanges or services or in the over-the-counter market,
or (iv) through the writing of options. In connection with sales of the
Registrable Securities or otherwise, the Selling Security Holder may enter into
hedging transactions with broker-dealers, which may in turn engage in short
sales of the Registrable Securities in the course of hedging positions they
assume. The Selling Security Holder may also sell Registrable Securities short
and deliver Registrable Securities to close out such short positions, or loan or
pledge Registrable Securities to broker-dealers that in turn may sell such
securities.
State any exceptions here:
34
Note: In no event will such method(s) of distribution take the
form of an underwritten offering of the Registrable Securities without the prior
agreement of the Company and the Trust.
By signing below, the Selling Security Holder acknowledges
that it understands its obligation to comply, and agrees that it will comply,
with the provisions of the Exchange Act and the rules and regulations
thereunder.
In the event that the Selling Security Holder transfers all or
any portion of the Registrable Securities listed in Item (3) above after the
date on which such information is provided to the Company and the Trust, the
Selling Security Holder agrees to notify the transferee(s) at the time of the
transfer of its rights and obligations under this Notice and Questionnaire and
the Registration Rights Agreement.
By signing below, the Selling Security Holder consents to the
disclosure of the information contained herein in its answers to Items (1)
through (6) above and the inclusion of such information in the Shelf
Registration Statement and related Prospectus. The Selling Security Holder
understands that such information will be relied upon by the Company and the
Trust in connection with the preparation of the Shelf Registration Statement and
related Prospectus.
In accordance with the Selling Security Holder's obligation
under Section 3(a) of the Registration Rights Agreement to provide such
information as may be required by law for inclusion in the Shelf Registration
Statement, the Selling Security Holder agrees to promptly notify the Company and
the Trust of any inaccuracies or changes in the information provided herein
which may occur subsequent to the date hereof at any time while the Shelf
Registration Statement remains in effect. All notices hereunder and pursuant to
the Registration Rights Agreement shall be made in writing, by hand-delivery,
first-class mail, or air courier guaranteeing overnight delivery as follows:
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(i) To the Trust:
Pioneer-Standard Financial Trust
c/o Pioneer-Standard Electronics, Inc.
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: Vice President, Treasurer and Assistant Secretary
(ii) With a copy to:
▇▇▇▇▇▇, Halter & Griswald LLP
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
Once this Notice and Questionnaire is executed by the Selling
Security Holder and received by the Company's counsel, the terms of this Notice
and Questionnaire, and the representations and warranties contained herein,
shall be binding on, shall inure to the benefit of and shall be enforceable by
the respective successors, heirs, personal representatives, and assigns of the
Company, the Trust and the Selling Security Holder (with respect to the
Registrable Securities beneficially owned by such Selling Security Holder and
listed in Item (3) above). This Agreement shall be governed in all respects by
the laws of the State of New York.
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APPENDIX I
NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT
---------------------------------
Attention:
-----------------------
---------------------------------
---------------------------------
---------------------------------
Re: Pioneer-Standard Financial Trust (the "Trust")
[ ]% Convertible Trust Preferred
Securities (the "Preferred Securities")
-----------------------------------------------
Ladies and Gentlemen:
Please be advised that _________________________ has
transferred _________ Preferred Securities, or $ __________ aggregate principal
amount of the Pioneer-Standard Electronics, Inc. (the "Company") 6 3/4% Junior
Convertible Subordinated Debentures due March 31, 2028 (the "Debentures") or
_____ the Company's common shares, without par value, issued on conversion of
the Preferred Securities and/or the Debentures ("Stock") pursuant to an
effective Shelf Registration Statement on Form S-3 (File No. 333- ) filed by the
Company.
We hereby certify that the prospectus delivery requirements,
if any, of the Securities Act of 1933, as amended, have been satisfied with
respect to the transfer described above and that the above-named beneficial
owner of the Preferred Securities, Debentures or Stock is named as a "Selling
Security Holder" in the Prospectus dated __________, ____ or in amendments or
supplements thereto, and that the aggregate principal amount of the Debentures,
or number of shares of Preferred Securities or shares of Stock transferred are
(a portion of) the Debentures, the Preferred Securities or Stock listed in such
Prospectus, as amended or supplemented, opposite such owner's name.
Dated:
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Very truly yours,
(Name)
