<PAGE>
Conformed
Securities and Exchange Commission
Washington, D.C. 20549
Form 10-Q
(Mark One)
[x] Quarterly Report Pursuant to Section 13 or 15 (d) of the Securities Exchange
Act of 1934 for the Quarterly Period Ended September 30, 2000
or
[ ] Transition Report Pursuant to Section 13 or 15 (d) of the Securities
Exchange Act of 1934 for the transition period from _______________ to
__________________
Commission file number 000-26926
ScanSource, Inc.
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(Exact name of registrant as specified in its charter)
South Carolina 57-0965380
-------------------------------- ------------------------------------
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporated or organization)
6 Logue Court, Suite G
Greenville, SC 29615
-------------------------------- ------------------------------------
(Address of principal executive (Zip Code)
offices)
(864) 288-2432
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
------- --------
As of September 30, 2000, 5,686,926 shares of the registrant's common stock, no
par value, were outstanding.
<PAGE>
SCANSOURCE, INC.
INDEX
FORM 10-Q
September 30, 2000
PART I. FINANCIAL INFORMATION Page No.
Item 1. Unaudited Consolidated Financial Statements........... 3
Unaudited Condensed Consolidated Balance Sheets....... 4
Unaudited Condensed Consolidated Income Statements.... 5
Unaudited Condensed Consolidated Statements of
Cash Flows.......................................... 6
Notes to Unaudited Consolidated Financial Statements.. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations................. 11
Item 3. Quantitative and Qualitative Disclosures About Market
Risk................................................ 14
PART II. OTHER INFORMATION
Item 1. Legal Proceedings..................................... 16
Item 2. Changes in Securities................................. 16
Item 3. Defaults Upon Senior Securities....................... 16
Item 4. Submission of Matters to a Vote of Security-Holders... 16
Item 5. Other Information..................................... 16
Item 6. Exhibits and Reports on Form 8-K...................... 16
SIGNATURES.............................................................. 17
2
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Unaudited Consolidated Financial Statements
SCANSOURCE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
<TABLE>
<CAPTION>
June 30, September 30,
2000 2000
-------- -------------
(Note 1) (Note 1)
<S> <C> <C>
Assets
------
Current assets:
Cash.................................... $ 4,612 $ 884
Receivables, net of allowance of
$5,464 at June 30, 2000 and
$6,411 at September 30, 2000......... 66,983 72,962
Other receivables....................... 3,060 3,139
Inventories............................. 101,654 137,163
Prepaid expenses and other assets........ 451 735
Deferred income taxes.................... 8,632 9,965
-------- --------
Total current assets................. 185,392 224,848
Property and equipment, net............... 18,390 19,250
Intangible assets, net.................... 1,635 1,588
Other assets.............................. 463 441
-------- --------
Total assets......................... $205,880 $246,127
======== ========
</TABLE>
See notes to unaudited condensed consolidated financial statements.
3
<PAGE>
SCANSOURCE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Continued)
June 30, September 30,
2000 2000
---- ----
(Note 1) (Note 1)
Liabilities and Shareholders' Equity
------------------------------------
Current liabilities:
Current portion of long-term debt............ $ 26 $ 151
Trade accounts payable....................... 98,627 124,339
Accrued expenses and other liabilities....... 5,083 5,914
Income taxes payable......................... 1,112 3,120
-------- --------
Total current liabilities................ 104,848 133,524
Deferred income taxes.......................... -- 24
Long-term debt................................. 1,647 8,866
Revolving line of credit....................... 24,919 24,614
-------- --------
Total liabilities........................ 131,414 167,028
Shareholders' equity:
Common stock, no par value; 10,000 shares
authorized, 5,611 and 5,687 shares issued
and outstanding at June 30, 1999 and
September 30, 2000, respectively............. 42,140 42,950
Retained earnings.............................. 32,326 36,149
-------- --------
Total shareholders' equity................... 74,466 79,099
-------- --------
Total liabilities and shareholders' equity... $205,880 $246,127
======== ========
See notes to unaudited condensed consolidated financial statements.
4
<PAGE>
SCANSOURCE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED INCOME STATEMENTS
<TABLE>
<CAPTION>
Three Months Ended
September 30,
1999 2000
---- ----
(In thousands, except per share data)
<S> <C> <C>
Net sales..................................... $113,179 $156,286
Cost of goods sold............................ 102,159 139,366
-------- --------
Gross profit.............................. 11,020 16,920
Selling, general and administrative
expenses.................................. 6,681 10,233
Amortization of intangibles................... 34 46
-------- --------
Total operating expenses.................. 6,715 10,279
-------- --------
Operating income.......................... 4,305 6,641
Other income (expense):
Interest income (expense), net............ 98 (475)
Other income, net......................... 7 --
-------- --------
Total other income (expense)........... 105 (475)
-------- --------
Income before income taxes.................... 4,410 6,166
Income taxes........................... 1,676 2,343
-------- --------
Net income.................................... $ 2,734 $ 3,823
======== ========
Basic EPS
Net income per share................... $ 0.50 $ 0.68
======== ========
Weighted average shares outstanding.... 5,512 5,648
======== ========
Diluted EPS
Net income per share................... $ 0.47 $ 0.62
======== ========
Weighted average shares outstanding.... 5,850 6,139
======== ========
</TABLE>
See notes to unaudited condensed consolidated financial statements.
5
<PAGE>
SCANSOURCE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Three Months Ended
<S> <C> <C>
September 30,
1999 2000
-------- --------
(In thousands)
Cash flows from operating activities:
Net income........................................... $ 2,734 $ 3,823
Adjustments to reconcile net income to cash
used in operating activities:
Depreciation.................................. 351 874
Amortization of intangible assets............. 34 46
Deferred taxes................................ (1,546) (1,309)
Provision for doubtful accounts............... (792) (941)
Changes in operating assets and liabilities:
Receivables................................. (4,994) (5,038)
Other receivables........................... 363 (79)
Inventories................................. (21,677) (35,509)
Prepaid expenses and other assets........... (96) (284)
Accounts payable............................ 22,544 25,712
Accrued expenses and other liabilities...... (16) 831
Income tax payable.......................... (466) 2,008
Other noncurrent assets..................... (35) 23
----- -----
Net cash used in operating activities............... (3,596) (9,843)
-------- --------
Cash flows used in investing activities-
Capital expenditures.............................. (540) (1,734)
-------- --------
Cash flows from financing activities:
Payments on revolving line of credit.............. -- (305)
Net proceeds from stock option exercises.......... 192 810
(Payments) borrowings on long term debt, net...... (5) 7,344
-------- --------
Net cash provided by financing activities........... 187 7,849
-------- --------
Decrease in cash.................................... (3,949) (3,728)
Cash at beginning of period........................... 15,282 4,612
-------- --------
Cash at end of period................................... $ 11,333 $ 884
======== ========
</TABLE>
See notes to unaudited condensed consolidated financial statements
6
<PAGE>
SCANSOURCE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(1) Basis of Presentation
The interim financial information included herein is unaudited. Certain
information and footnote disclosures normally included in the consolidated
financial statements have been condensed or omitted pursuant to the rules and
regulations of the Securities and Exchange Commission (SEC), although the
Company believes that the disclosures made are adequate to make the
information presented not misleading. These financial statements should be
read in conjunction with the financial statements and related notes contained
in the Company's June 30, 2000 annual report on Form 10-K. Other than as
indicated herein, there have been no significant changes from the financial
data published in that report. In the opinion of management, such unaudited
information reflects all adjustments, consisting only of normal recurring
accruals and other adjustments as disclosed herein, necessary for a fair
presentation of the unaudited information.
Results for interim periods are not necessarily indicative of results expected
for the full year, or for any subsequent period.
The condensed consolidated balance sheet for June 30, 2000 has been derived
from the audited consolidated balance sheet for that date.
(2) Significant Accounting Policies
Consolidation Policy - The consolidated financial statements include the
accounts of ScanSource, Inc. and its wholly owned and majority owned
subsidiaries. All significant inter-company accounts and transactions have
been eliminated.
Minority Interest - Beginning in April 2000, the Company invested
approximately $1 million for a majority interest in a newly formed subsidiary
to perform e-logistics. The minority shareholders share of income since the
acquisition has been insignificant. Accordingly, no amounts have been
recognized for minority interests in the accompanying consolidated balance
sheets or statements of operations.
Use of Estimates - The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
Revenue Recognition - Revenues are recognized for the sale of products upon
shipment.
Sales of products are primarily recorded on a gross basis with a separate
display of cost of goods sold to arrive at gross profit. In addition, the
Company currently has arrangements in which it
7
<PAGE>
SCANSOURCE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
earns a service fee determined as a percentage of the value of products
shipped on behalf of the manufacturer who retains the risk of ownership and
credit loss. Such service fees earned by the Company are included in net
sales.
Inventories - Inventories (consisting of automatic data capture, point-of-
sale, business phone and computer telephony equipment) are stated at the lower
of cost (first-in, first-out method) or market.
Net Income Per Share - Basic net income per share is computed by dividing net
income by the weighted average number of common shares outstanding. Diluted
net income per share is computed by dividing net income by the weighted
average number of common and potential common shares outstanding. Diluted
weighted average common and potential common shares include common shares and
stock options using the treasury stock method.
The reconciliation of basic and diluted income per share is as follows:
<TABLE>
<CAPTION>
Per Share
Income Shares Amount
---------- --------- ------
<S> <C> <C> <C>
Three months ended September 30, 2000:
Basic income per share $3,823,000 5,648,000 $0.68
=====
Effect of dilutive stock options -- 491,000
---------- ---------
Diluted income per share $3,823,000 6,139,000 $0.62
========== ========= =====
Three months ended September 30, 1999:
Basic income per share $2,734,000 5,512,000 $0.50
=====
Effect of dilutive stock options -- 338,000
---------- ---------
Diluted income per share $2,734,000 5,850,000 $0.47
========== ========= =====
</TABLE>
(3) Revolving Credit Facility
On November 10, 2000, the Company amended and restated the line of credit
agreement with its bank, effective as of September 30, 2000 and extending to
September 2002, with a borrowing limit of the lesser of (i) $50 million or
(ii) the total of 85% of eligible accounts receivable plus 50% of eligible
inventory. The facility bears interest at the 30 day LIBOR rate of interest
plus a rate varying from 1.25% to 2.50% tied to the Company's debt-to-net
worth ratio ranging from 0.75:1 to 2.75:1. The revolving credit facility is
collateralized by accounts receivable and eligible inventory. The agreement
contains certain financial covenants including minimum net worth requirements,
capital expenditure limits and a maximum debt to tangible net worth ratio.
The effective interest rate at September 30, 2000 was 8.63% and the
outstanding balance on the
8
<PAGE>
SCANSOURCE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
line of credit was $24.6 million on a borrowing base, which exceeded $50
million, leaving $25.4 million available at September 30, 2000. The Company
was in compliance with the various covenants at September 30, 2000.
(4) Long-term Debt
The Company has a nonrecourse loan in the amount of $1,719,000 related to the
purchase of its Greenville office building. The loan has a fixed interest
rate of 9.19%, is due in November 2006, and is collateralized by the land and
building acquired.
In August 2000, the Company closed a real estate loan in the amount of
$7,350,000, at the 30 day LIBOR rate of interest plus a rate varying from
1.40% to 2.65% tied to the Company's debt to net worth ratio ranging from
0.75:1 to 2.75:1. The loan is due September 2005 and is collateralized by the
Memphis distribution center land and building. The agreement contains certain
financial covenants including minimum net worth requirements, capital
expenditure limits and a maximum debt to tangible net worth ratio. The
Company was in compliance with the various covenants at September 30, 2000.
(5) Segment Information
The Company sells only in the United States and Canada. Its sales to Canada
were $4,669,000 and $4,695,000 for the quarters ended September 30, 1999 and
2000, respectively.
The Company operates in two reportable segments: value-added distribution and
a web-based order fulfillment unit called ChannelMax.
The first reportable segment, value-added distribution, offers approximately
16,000 products for sale in two primary categories: i) automatic data capture
and point-of-sale equipment sold by the ScanSource sales team and ii) business
telephones and computer/phone convergence products sold by the Catalyst
Telecom sales team. These products are sold to more than 11,000 resellers and
integrators of technology products, who are geographically disbursed over
North America in a pattern that mirrors population concentration. Of its
customers, no single account represented more than 3% and 4% of total Company
sales in the first quarter of 1999 and 2000, respectively.
The second reportable segment is the e-logistics unit which provides real-time
inventory availability and web catalog, order entry, order tracking and
logistics for customers in the bar code and business telephone markets. This
unit serves less than 15 customers, the largest of whom accounted for 7% and
2% of total Company sales in the first quarter of 1999 and 2000, respectively.
Sales by this unit include some programs that meet gross revenue recognition
criteria and others that require net revenue recognition.
9
<PAGE>
SCANSOURCE, INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Operating results for each business unit are summarized below with historical
data for 1999 restated to conform to the new organization structure:
For the three months ended September 30, 1999 and 2000:
<TABLE>
<S> <C> <C> <C> <C>
Net sales 1999 2000
------------ ------------
Value-added distribution $103,587,000 92% $137,673,000 88%
E-logistics 9,592,000 8% 18,613,000 12%
------------ --- ------------ ----
$113,179,000 100% $156,286,000 100%
============ === ============ ====
Operating income
Value-added distribution $ 10,253,000 9.9% $ 15,524,000 11.3%
E-logistics 767,000 8.0% 1,396,000 7.5%
------------ ------------
Gross profit 11,020,000 9.7% 16,920,000 10.8%
Corporate operating and distribution
center expenses 6,715,000 10,279,000
------------ ------------
Operating income $ 4,305,000 $ 6,641,000
============ ============
Assets
Value-added distribution $101,955,000 $187,724,000
E-logistics 18,564,000 22,401,000
Corporate cash and other assets 30,201,000 36,002,000
------------ ------------
$150,720,000 $246,127,000
============ ============
</TABLE>
10
<PAGE>
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Results of Operations
Net Sales. Net sales for the quarter ended September 30, 2000 increased
38.1% to $156.3 million from $113.2 million for the comparable prior year
quarter. The Company is organized in two business units. Sales through value-
added distribution increased 32.9% to $137.7 million for the quarter ended
September 30, 2000 from $103.6 million for the comparable prior year quarter. E-
logistics sales increased 94.0% to $18.6 million for the quarter ended September
30, 2000 from $9.6 million for the comparable prior year quarter. Canada sales
have been less than 5.0% of total Company sales in each quarter presented.
Growth of net sales resulted primarily from additions to the Company's sales
force, competitive product pricing, selective expansion of its product line, and
increased marketing efforts to specialty technology resellers.
Gross Profit. Gross profit for the quarter ended September 30, 2000
increased 53.5% to $16.9 million from $11.0 million for the comparable prior
year quarter. Gross profit as a percentage of sales was 10.8% for the quarter
ended September 30, 2000, compared to 9.7% for the comparable prior year period.
Gross margins from value-added distribution were 11.3% and 9.9% for each of the
quarters ended September 30, 2000 and 1999, respectively. The increase in gross
profit as a percentage of sales is the result of a change in the mix of sales to
higher-margin products. Gross margins for e-logistics were 7.5% and 8.0% for
each of the quarters ended September 30, 2000 and 1999, respectively. The
decrease in margins for 2000 was caused by a change in the mix of customers and
to changes in some programs provided to customers in 1999.
Operating Expenses. Operating expenses, which include selling, general and
administrative expenses and amortization, for the quarter ended September 30,
2000 increased 53.1% to $10.3 million compared to $6.7 million for the
comparable prior year period. Operating expenses as a percentage of sales were
6.6% for the quarter ended September 30, 2000, compared to 5.9% for the
comparable prior year period. Generally, higher gross margin sales require the
Company to provide greater levels of customer consultation and service causing a
corresponding increase in operating expenses. The general and administrative
portion of operating expenses also increased as a percentage of sales due to a
new marketing initiative begun by the Company.
Operating Income. Operating income for the quarter ended September 30,
2000 increased 54.3% to $6.6 million from $4.3 million for the same period in
1999, driven by the improvement in gross profit as described above. Operating
income as a percentage of sales was 4.2% for the quarter ended September 30,
2000, compared to 3.8% for the comparable prior year period.
Other Income (Expense). Total other income (expense) net consists of
interest income (expense), net, and other income, net. Interest expense for the
quarter ended September 30, 2000 was $475,000 resulting primarily from interest
expense on the revolving line of credit and long term debt. Interest income for
the quarter ended September 30, 1999 was $98,000 resulting primarily
frominterest income of $136,000 from invested cash offset by interest paid on
long term debt of $38,000.
11
<PAGE>
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Income Taxes. Tax expense was provided at an effective rate of 38% for
both periods presented, and represents the state and federal tax expected to be
due after annualizing income to the fiscal year end.
Net Income. Improved operating income caused net income to increase 39.8%
to $3.8 million for the quarter ended September 30, 2000 from $2.7 million for
the comparable prior year quarter. Net income as a percentage of sales was 2.4%
for both quarters ended September 30, 2000 and 1999.
Liquidity and Capital Resources
The Company's primary sources of liquidity are results of operations,
borrowings under its revolving credit facility, and proceeds from the sales of
securities.
In August 2000, the Company closed a real estate loan in the amount of
$7,350,000, at the 30 day LIBOR rate of interest plus a rate varying from 1.40%
to 2.65% tied to the Company's debt to net worth ratio ranging from 0.75:1 to
2.75:1. The loan is due September 2005 and is collateralized by the Memphis
distribution center land and building. The agreement contains certain financial
covenants including minimum net worth requirements, capital expenditure limits
and a maximum debt to tangible net worth ratio. The Company was in compliance
with the various covenants at September 30, 2000.
On November 10, 2000, the Company amended and restated the line of credit
agreement with its bank, effective September 30, 2000 and extending to September
2002 with a borrowing limit of $50.0 million, based upon 85% of eligible
accounts receivable and 50% of eligible inventory at the 30 day LIBOR rate of
interest plus a rate varying from 1.25% to 2.50% tied to the Company's debt-to-
net worth ratio ranging from 0.75:1 to 2.75:1. The revolving credit facility is
collateralized by accounts receivable and eligible inventory. The borrowing
base available under the credit facility is limited to 85% of eligible accounts
receivable and 50% of eligible inventory. The agreement contains certain
financial covenants including minimum net worth requirements, capital
expenditure limits and a maximum debt to tangible net worth ratio. The
effective interest rate at September 30, 2000 was 8.63% and the outstanding
balance on the line of credit was $24.6 million on a borrowing base, which
exceeded $50 million, leaving $25.4 million available at September 30, 2000. The
Company was in compliance with the various covenants at September 30, 2000.
For the quarter ended September 30, 2000 net cash of $9.8 million was used
in operating activities compared to $3.6 million used in operations for the
quarter ended September 30, 1999. Cash in both periods was primarily used to
fund increases in inventory and accounts receivable partially offset by
increases in accounts payable.
Cash used in investing activities of $1.7 million and $500,000 for the
quarters ended September 30, 2000 and 1999, respectively, was for capital
expenditures.
12
<PAGE>
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Cash provided by financing activities for the quarter ended September 30,
2000 was $7.8 million, which included borrowings on a real estate loan of $7.3
million, proceeds from stock option exercises of $800,000, offset by payments on
the revolving line of credit of $300,000. Cash used in financing activities for
the quarter ended September 30, 1999 was $187,000, primarily from proceeds from
stock option exercises.
The Company believes that cash flows from operations, its bank revolving
credit facility and vendor financing will be sufficient to meet its forecasted
cash requirements for at least the next year.
13
<PAGE>
Item 3. Quantitative and Qualitative Disclosures
About Market Risk
The Company is exposed to changes in financial market conditions in the
normal course of its business as a result of its selective use of bank debt as
well as transacting in Canadian currency in connection with its Canadian
operations.
The Company is exposed to changes in interest rates primarily as a result
of its borrowing activities, which includes a revolving credit facility with a
bank used to maintain liquidity and fund the Company's business operations. The
nature and amount of the Company's debt may vary as a result of future business
requirements, market conditions and other factors. The definitive extent of the
Company's interest rate risk is not quantifiable or predictable because of the
variability of future interest rates and business financing requirements, but
the Company does not believe such risk is material. The Company does not
currently use derivative instruments to adjust its interest rate risk profile.
The Company is exposed to changes in foreign exchange rates in connection
with its Canadian operations. It is the Company's policy to enter into foreign
currency transactions only to the extent considered necessary to support its
Canadian operations. The amount of the Company's cash deposits denominated in
Canadian currency has not been, and is not expected to be, material.
Furthermore, the Company has no capital expenditure or other purchase
commitments denominated in foreign currency. The Company does not utilize
forward exchange contracts, currency options or other traditional hedging
vehicles to adjust the Company's foreign exchange rate risk profile. The
Company does not enter into foreign currency transactions for speculative
purposes.
The Company does not utilize financial instruments for trading or other
speculative purposes, nor does it utilize leveraged financial instruments. On
the basis of the fair value of the Company's market sensitive instruments at
September 30, 2000, the Company does not consider the potential near-term losses
in future earnings, fair values and cash flows from reasonable possible near-
term changes in interest rates and exchange rates to be material.
Forward Looking Statements
Certain of the statements contained in this report to shareholders as well
as in the Company's other filings with the Securities and Exchange Commission
that are not historical facts are forward-looking statements subject to the safe
harbor created by the Private Securities Litigation Reform Act of 1995. The
Company cautions readers of this report that a number of important factors could
cause the Company's activities and/or actual results in fiscal 2001 and beyond
to differ materially from those expressed in any such forward-looking
statements. These factors include, without limitation, the Company's dependence
on vendors, product supply, senior management, centralized functions, and third-
party shippers, the Company's ability to compete successfully in a highly
competitive market and manage significant additions in personnel and increases
in working capital, the Company's entry into new products markets in which it
has no prior experience, the Company's susceptibility to quarterly fluctuations
in net sales and operating results, the Company's ability to
14
<PAGE>
manage successfully price protection or stock rotation opportunities associated
with inventory value decreases, and other factors described in other reports and
documents filed by the Company with the Company with the Securities and Exchange
Commission.
15
<PAGE>
PART II. OTHER INFORMATION
Item 1. Legal Proceedings.
Not applicable
Item 2. Changes in Securities.
Not applicable
Item 3. Defaults Upon Senior Securities.
Not applicable
Item 4. Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 5. Other information.
Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
Exhibit 10.1 Amended and Restated Loan and Security
Agreement dated November 10, 2000,
effective as of September 30, 2000 by and
among ScanSource, Inc., Branch Bank &
Trust Company of South Carolina, and 4100
Quest, LLC.
Exhibit 10.2 Loan Agreement dated as of July 28, 2000,
by and between Branch Banking and Trust
Company of South Carolina, 4100 quest
L.L.C., and ScanSource, Inc.
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K
A report was filed on October 23, 2000 regarding a
change in independent accountants.
16
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
SCANSOURCE, INC.
/s/ Michael L. Baur
-----------------------------------------
MICHAEL L. BAUR
Chief Executive Officer
/s/ Jeffery A. Bryson
-----------------------------------------
JEFFERY A. BRYSON
Chief Financial Officer
Date: November 13, 2000
17
