EXHIBIT 10.16
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STONERIDGE, INC.
as Borrower
THE LENDERS NAMED THEREIN
as Lenders
DLJ CAPITAL FUNDING, INC.
as Syndication Agent
NATIONAL CITY BANK
as a Lender, a Letter of Credit Issuer,
the Administrative Agent and the Collateral
Agent
PNC BANK, NATIONAL ASSOCIATION
as Documentation Agent
_____________________
AMENDMENT NO. 2
dated as of
September 7, 1999
to
CREDIT AGREEMENT
dated as of
December 30, 1998
_____________________
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AMENDMENT NO. 2 TO CREDIT AGREEMENT
THIS AMENDMENT NO. 2 TO CREDIT AGREEMENT, dated as of September 7, 1999
("this Amendment"), among the following:
(i) STONERIDGE, INC., an Ohio corporation (herein, together with its
successors and assigns, the "Borrower");
(ii) the Lenders signatory hereto;
(iii) DLJ CAPITAL FUNDING, INC., a Delaware corporation, as
Syndication Agent;
(iv) NATIONAL CITY BANK, a national banking association, as a Lender,
the Letter of Credit Issuer, and as the Administrative Agent and the
Collateral Agent under the Credit Agreement; and
(v) PNC BANK, NATIONAL ASSOCIATION, a national banking association,
as the Documentation Agent:
PRELIMINARY STATEMENTS:
(1) The Borrower, the Lenders named therein, and the Agents entered into
the Credit Agreement, dated as of December 30, 1998, as amended by Amendment No.
1 thereto, dated as of January 28, 1999 (as so amended and in effect immediately
prior to the effective date of this Amendment, the "Credit Agreement"; with the
terms defined therein, or the definitions of which are incorporated therein,
being used herein as so defined).
(2) The parties hereto desire to change certain of the terms and provisions
of the Credit Agreement, all as more fully set forth below.
(3) For the avoidance of doubt, insofar as the Lenders are concerned, is
noted that in accordance with the provisions of section 12.12 of the Credit
Agreement, the changes in the Credit Agreement effected by this Amendment which
relate only to the Revolving Loans, the Revolving Commitments, the Term A Loans
and the Term A Commitments, must be approved by Lenders whose Revolving
Commitments and Term A Commitments represent 100% of the Total Revolving
Commitment and 100% of the Total Term A Commitment, respectively.
NOW, THEREFORE, the parties hereby agree as follows:
SECTION 1. AMENDMENTS, ETC.
1.1. Definition of Permitted Acquisition. Clause (iii) of the definition
of the term "Permitted Acquisition" which appears in section 1.1 of the Credit
Agreement is amended by changing the dollar amount "$50,000,000" which appears
therein to "$75,000,000" and by changing the starting time for purposes thereof
from the Closing Date to August 15, 1999 (excluding the Acquisition of TVI
Europe Limited), with the result that such clause (iii) as so amended, will read
in its entirety as follows:
(iii) the aggregate consideration for such Acquisition and all other
Acquisitions completed after August 15, 1999 (other than the Acquisition of
TVI Europe Limited, scheduled to be completed on or about August 20, 1999),
including the principal amount of any assumed Indebtedness and (without
duplication) any Indebtedness of any acquired person or persons, does not
exceed $75,000,000 (such amount being subject to annual increase,
commencing in the year 2000 (based on fiscal year ended December 31, 1999),
by an amount equal to (x) 12.5% of Excess Cash Flow for the preceding
fiscal year, minus (y) the amount expended for dividends and stock
repurchases during such preceding fiscal year as contemplated by section
9.6 hereof), unless the Required Lenders specifically approve or consent to
such Acquisition in writing;
1.2. Pricing Grid for Revolving Loans and Term A Loans. The Pricing Grid
Table which appears in section 2.7(g) of the Credit Agreement is amended to read
in its entirety as follows:
PRICING GRID TABLE
FOR
REVOLVING LOANS AND TERM A LOANS
(Expressed in Basis Points)
Ratio of Applicable Prime Applicable Applicable
Consolidated Total Debt Rate Margin Eurodollar Margin Commitment Fee
to Rate
Consolidated EBITDA
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Greater than 3.00 to 1.00 100.00 250.00 50.00
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Greater than 2.50 to 1.00
and less than or equal to 3.00 to 1.00 62.50 212.50 50.00
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Greater than 2.00 to 1.00
and less than or equal to 2.50 to 1.00 25.00 175.00 50.00
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Greater than 1.50 to 1.00
and less than or equal to 2.00 to 1.00 -0- 150.00 37.50
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Less than or equal to 1.50 to 1.00 -0- 125.00 37.50
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1.3. Effectiveness of Pricing Changes. (a) Effective as of the
Effective Date of this Amendment, for all Revolving Loans and Term A Loans then
or thereafter outstanding, and until changed in accordance with the applicable
provisions of section 2.7(g) of the Credit Agreement based on the consolidated
financial statements of the Borrower for a fiscal quarter ended September 30,
1999 or thereafter, the Applicable Prime Rate Margin for Revolving Loans and
Term A Loans will be 100 basis points per annum, and the Applicable Eurodollar
Margin for Revolving Loans and Term A Loans will be 250 basis points per annum.
(b) Effective as of the Effective Date of this Amendment, and until changed
in accordance with the applicable provisions of section 4.1(a) of the Credit
Agreement based on the consolidated financial statements
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of the Borrower for a fiscal quarter ended September 30, 1999 or thereafter, the
Applicable Commitment Fee Rate will be 50 basis points per annum.
1.4. Incorporation of Amendment No. 1. For the convenience of the parties
and the avoidance of doubt, it is hereby confirmed that the only changes to the
Credit Agreement effected by Amendment No. 1 thereto, dated as of January 28,
1999, were the following:
(a) The reference in section 5.2(c) of the Credit Agreement to "the
fiscal year ended December 31, 1998" was changed to "the fiscal year ended
December 31, 1999".
(b) The amount "$30,375,000", which appears in the table in section
5.2(a) of the Credit Agreement as the Scheduled Repayment for Term B Loans
on March 31, June 30, September 30 and December 31, 2005, was changed in
each such instance to "$30,312,500".
SECTION 2. REPRESENTATIONS AND WARRANTIES.
The Borrower represents and warrants as follows:
2.1. Authorization and Validity of Amendment, etc. This Amendment has
been duly authorized by all necessary corporate action on the part of the
Borrower, has been duly executed and delivered by a duly authorized officer of
the Borrower, and constitutes the valid and binding agreement of the Borrower,
enforceable against the Borrower in accordance with its terms, except to the
extent that the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws generally affecting
creditors' rights and by equitable principles (regardless of whether enforcement
is sought in equity or at law).
2.2. Representations and Warranties. The representations and warranties
of the Credit Parties contained in the Credit Agreement or in the other Credit
Documents are true and correct in all material respects on and as of the date
hereof as though made on and as of the date hereof, except to the extent that
such representations and warranties expressly relate to an earlier specified
date, in which case such representations and warranties are hereby reaffirmed as
true and correct in all material respects as of the date when made.
2.3. No Event of Default. No condition or event has occurred or exists
which constitutes or which, after notice or lapse of time or both, would
constitute an Event of Default.
2.4. Compliance. The Borrower is in full compliance with all covenants
and agreements contained in the Credit Agreement, as amended hereby, and the
other Credit Documents to which it is a party; and without limitation of the
foregoing, each Subsidiary of the Borrower which, as of the date hereof, is
required to be a Subsidiary Guarantor, has as on or prior to the date hereof
become a Subsidiary Guarantor under the Subsidiary Guaranty.
2.5. Financial Statements, etc. The Borrower has furnished to the Lenders
and the Administrative Agent complete and correct copies of:
(a) the audited consolidated balance sheets of the Borrower and its
consolidated subsidiaries as of December 31, 1997, and December 31, 1998,
and the related audited consolidated statements of income, stockholders'
equity, and cash flows for the fiscal years then ended, accompanied by the
unqualified report thereon of the Borrower's independent accountants; and
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(b) the unaudited condensed consolidated balance sheets of the
Borrower and its consolidated subsidiaries as of June 30, 1999, and the
related unaudited condensed consolidated statements of income and of cash
flows of the Borrower and its consolidated subsidiaries for the fiscal
quarter or quarters then ended, as contained in the Form 10-Q Quarterly
Report of the Borrower filed with the SEC.
All such financial statements have been prepared in accordance with GAAP,
consistently applied (except as stated therein), and fairly present the
financial position of the Borrower and its consolidated subsidiaries as of the
respective dates indicated and the consolidated results of their operations and
cash flows for the respective periods indicated, subject in the case of any such
financial statements which are unaudited, to the absence of footnotes and to
normal audit adjustments which the Borrower reasonably believes will not involve
a Material Adverse Effect.
SECTION 3. RATIFICATIONS.
Except as expressly modified and superseded by this Amendment, the terms
and provisions of the Credit Agreement are ratified and confirmed and shall
continue in full force and effect.
SECTION 4. BINDING EFFECT.
This Amendment shall become effective on a date (the "Effective Date"), on
or before September 7, 1999, if the following conditions shall have been
satisfied on and as of such date:
(a) this Amendment shall have been executed by the Borrower and the
Administrative Agent, and counterparts hereof as so executed shall have
been delivered to the Administrative Agent;
(b) the Acknowledgment and Consent appended hereto shall have been
executed by the Credit Parties named therein, and counterparts thereof as
so executed shall have been delivered to the Administrative Agent; and
(c) the Administrative Agent shall have been notified by the Required
Lenders that such Lenders have executed this Amendment (which notification
may be by facsimile or other written confirmation of such execution);
provided, however, that the particular amendments contained in sections 1.2
and 1.3 of this Amendment shall not become effective unless the
Administrative Agent shall have been so notified by Lenders whose Revolving
Commitments and Term A Commitments represent 100% of the Total Revolving
Commitment and 100% of the Total Term A Commitment, respectively, that such
Lenders have executed this Amendment;
and thereafter this Amendment shall be binding upon and inure to the benefit of
the Borrower, the Agents, and each Lender and their respective permitted
successors and assigns. After this Amendment becomes effective, the
Administrative Agent will promptly furnish a copy of this Amendment to each
Lender and the Borrower, advise them of the Effective Date, and also advise them
whether the amendments contained in sections 1.2 and 1.3 of this Amendment have
also become effective.
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SECTION 5. MISCELLANEOUS.
5.1. Survival of Representations and Warranties. All representations and
warranties made in this Amendment shall survive the execution and delivery of
this Amendment, and no investigation by the Administrative Agent or any Lender
or any subsequent Loan or other Credit Event shall affect the representations
and warranties or the right of the Administrative Agent or any Lender to rely
upon them.
5.2. Reference to Credit Agreement. The Credit Agreement and any and all
other agreements, instruments or documentation now or hereafter executed and
delivered pursuant to the terms of the Credit Agreement as amended hereby, are
hereby amended so that any reference therein to the Credit Agreement shall mean
a reference to the Credit Agreement as amended hereby.
5.3. Expenses. As provided in the Credit Agreement, but without limiting
any terms or provisions thereof, the Borrower shall pay on demand all reasonable
costs and expenses incurred by the Administrative Agent in connection with the
preparation, negotiation, and execution of this Amendment, including without
limitation the reasonable costs and fees of the Administrative Agent's special
legal counsel, regardless of whether this Amendment becomes effective in
accordance with the terms hereof, and all reasonable costs and expenses incurred
by the Administrative Agent or any Lender in connection with the enforcement or
preservation of any rights under the Credit Agreement, as amended hereby.
5.4. Severability. Any term or provision of this Amendment held by a
court of competent jurisdiction to be invalid or unenforceable shall not impair
or invalidate the remainder of this Amendment and the effect thereof shall be
confined to the term or provision so held to be invalid or unenforceable.
5.5. Applicable Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of Ohio.
5.6. Headings. The headings, captions and arrangements used in this
Amendment are for convenience only and shall not affect the interpretation of
this Amendment.
5.7. Entire Agreement. This Amendment is specifically limited to the
matters expressly set forth herein. This Amendment and all other instruments,
agreements and documentation executed and delivered in connection with this
Amendment embody the final, entire agreement among the parties hereto with
respect to the subject matter hereof and supersede any and all prior
commitments, agreements, representations and understandings, whether written or
oral, relating to the matters covered by this Amendment, and may not be
contradicted or varied by evidence of prior, contemporaneous or subsequent oral
agreements or discussions of the parties hereto. There are no oral agreements
among the parties hereto relating to the subject matter hereof or any other
subject matter relating to the Credit Agreement.
5.8. Jury Trial Waiver. EACH OF THE PARTIES TO THIS AMENDMENT HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AMENDMENT, THE OTHER CREDIT
DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY HERETO
HEREBY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS AMENDMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.
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5.9. Counterparts. This Amendment may be executed by the parties hereto
separately in one or more counterparts, each of which when so executed shall be
deemed to be an original, but all of which when taken together shall constitute
one and the same agreement.
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IN WITNESS WHEREOF, this Amendment has been duly executed and delivered as
of the date first above written.
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NATIONAL CITY BANK, STONERIDGE, INC.
as a Lender, the letter of Credit Issuer,
the Administrative Agent and
the Collateral Agent
By: /s/ Xxxxxxx X. XxXxxx By: /s/ Xxxxx X. Xxxxx
-------------------------- -------------------------
Xxxxxxx X. XxXxxx Xxxxx X. Xxxxx
Senior Vice President Vice President-Finance
& Chief Financial Officer
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PNC BANK, NATIONAL ASSOCIATION, DLJ CAPITAL FUNDING, INC.,
as a Lender and as Documentation Agent as Syndication Agent
By: /s/ Xxxxxx X. Xxxxx By: /s/ Xxxx Xxxxxxx
-------------------------- -------------------------
Title: Vice President Title: Managing Director
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ABN AMRO BANK N. V. THE BANK OF NOVA SCOTIA,
Chicago Branch
By: /s/ Xxxxxxxxxxx X. Xxxxxxx By: /s/ Xxxx Xxxxxxx
-------------------------- -------------------------
Title: Vice President Title: Relationship Manager
By: /s/ Xxxxxxx Xxxxxxx By: /s/ F.G.H. Xxxxx
-------------------------- -------------------------
Title: Vice President Title: Senior Manager Loan Operations
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MELLON BANK, N. A. COMERICA BANK
By: /s/ Xxxx Xxxxxx By: /s/ Xxxxxxxx Xxxxxx
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Title: Vice President Title: Account Officer
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BANK ONE, MICHIGAN FIRSTAR BANK, NATIONAL ASSOCIATION
(formerly NBD Bank) (formerly Star Bank, National Association)
By: /s/ Xxxxxx Xxxxxx By: /s/ Xxxx X. Xxxxxxx
-------------------------- -------------------------
Title: Vice President Title: Senior Vice President
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XXXXXX TRUST AND SAVINGS BANK BankBoston, N.A
By: /s/ Xxxxx X. Xxxxxxxx By: /s/ Xxxxxxx X. Xxxxxx Xx.
-------------------------- -------------------------
Title: Vice President Title: Director
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MERCANTILE BANK NA SunTrust Bank, Central Florida, National
Association
By: /s/ Xxx Xxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------- -------------------------
Title: Vice President Title: Vice President
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GENERAL ELECTRIC CAPITAL CORPORATION BANK AUSTRIA CREDITANSTALT CORPORATE FINANCE,
INC
By: /s/ Xxxxxxx Xxxxxxxxxx By: /s/ Xxxxxxxx X. XxxXxxxxx
---------------------------- ---------------------------
Title: Title: Vice President
By: /s/ Xxxxxxx X. Vuchanavage
---------------------------
Title: Senior Vice President
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SUMMIT BANK
By: /s/ Xxxxxxx Xxxxxxxxx
---------------------------
Title: Director
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SIGNATURES FOR TERM B LENDERS SIGNATURES FOR TERM B LENDERS
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BLACK DIAMOND CAPITAL MANAGEMENT XXXXXX XXXXXXX XXXX XXXXXX
By: /s/ Xxxxx Xxxxxx By: /s/ Xxxxx Xxxxxxx
------------------------ -------------------------
Name: Xxxxx Xxxxxx Name: Xxxxx Xxxxxxx
Title: Loan Administrator Title:
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FIRST DOMINION CAPITAL, L. L. C. NATIONAL WESTMINSTER BANK PLC
By: /s/ Xxxxxxx Xxxxxxxxxx By: /s/ Xxxx Xxxxx
------------------------ -------------------------
Name: Xxxxxxx Xxxxxxxxxx Name: Xxxx Xxxxx
Title: Title:
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XXXXXX, XXXXXX & CO. OASIS COLLATERAL HIGH INCOME
By: /s/ Xxxx Xxxxxx By: /s/ Xxx Xxxxxxx
------------------------ -------------------------
Name: Xxxx Xxxxxx Name: Xxx Xxxxxxx
Title: Title: Vice President
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ARCHIMEDES FUNDING II, LTD. OSPREY INVESTMENTS PORTFOLIO
By: /s/ Xxxxxxx Xxxxxx By: /s/ Xxx Xxx
------------------------ -------------------------
Name: Xxxxxxx Xxxxxx Name: Xxx Xxx
Title: Senior Vice President Title:
----------------------------------------------------------------------------------------------------------------
CAPTIVA IV FINANCE LTD., SENIOR DEBT PORTFOLIO (BOSTON MANAGEMENT AND
as advised by Pacific Investment RESEARCH)
Management Co.
By: /s/ Xxxxxxx Xxxxxxx By: /s/ Xxxxxx X'Xxxxx
------------------------ -------------------------
Name: Xxxxxxx Fejadsz Name: Xxxxxx X'Xxxxx
Title: Title:
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ATHENA CDO, LIMITED XXXXXX CO. LIMITED
by: Pacific Investment Management Co.,
as its investment advisor
By: /s/ Xxxxxxx Fejadsz By: /s/ Xxxx Xxxxxx
------------------------ -------------------------
Name: Xxxxxxx Fejadsz Name: Xxxx Xxxxxx
Title: Title: Managing Director
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SIGNATURES FOR TERM B LENDERS SIGNATURES FOR TERM B LENDERS
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FREMONT INVESTMENT LOAN SRV-HIGHLAND
By: /s/ Xxxxxxxx X. Xxxx By: /s/ Xxxx Xxxxx
--------------------------- ---------------------------
Name: Xxxxxxxx X. Xxxx Name: Xxxx Xxxxx
Title: Vice President Title: Executive Vice President
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FLEET NATIONAL BANK XXXXX, XXX & FARNHAM, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx By: /s/ Xxxxx X. Good
--------------------------- ---------------------------
Name: Xxxxxxx X. Xxxxxxxx Name: Xxxxx X. Good
Title: Vice President Title: Vice President
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KZH ING--2 LLC XXXXX XXX FLOATING RATE, LLC
By: /s/ Xxxxx Xxxxxx By: /s/ Xxxxx X. Good
--------------------------- ---------------------------
Name: Xxxxx Xxxxxx Name: Xxxxx X. Good
Title: Title: Vice President
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KZH ING--3 LLC TEXAS COMMERCE BANK, N. A.
By: /s/ Xxxx XxXxxxxxx By: /s/ Xxx Xxxxxxxx
--------------------------- ---------------------------
Name: Xxxx XxXxxxxxx Name: Xxx Xxxxxxxx
Title: Title:
----------------------------------------------------------------------------------------------------------------
KZH LANGDALE LLC TORONTO DOMINION (N. Y.), INC.
By: /s/ Xxxxxxxx Xxxxxx By: /s/ Xxxxx Xxxxxx
--------------------------- ---------------------------
Name: Xxxxxxxx Xxxxxx Name: Xxxxx Xxxxxx
Title: Title:
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SIGNATURES FOR TERM B LENDERS SIGNATURES FOR TERM B LENDERS
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KZH RIVERSIDE LLC TRAVELERS CORPORATE LOAN FUND
By: /s/ Xxxx Xxxxxxx By: /s/ Xxxx Xxxxxxxx
------------------------- -------------------------
Name: Xxxx Xxxxxxx Name: Xxxx Xxxxxxxx
Title: Title:
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KZH SOLEIL LLC TRAVELERS INSURANCE COMPANY
By: /s/ Xxxxxx Xxxxxx By: /s/ Xxxx Xxxxxxxx
------------------------- -------------------------
Name: Xxxxxx Xxxxxx Name: Xxxx Xxxxxxxx
Title: Title: Second Vice President
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MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY XXX XXXXXX CLO I, LIMITED
By: /s/ Xxxx Xxxxxx By: /s/ Xxxxxxx X. Xxxxxx
------------------------- -------------------------
Name: Xxxx Xxxxxx Name: Xxxxxxx X. Xxxxxx
Title: Managing Director Title: Senior Vice President
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XXXXXXX XXXXX SENIOR FLOATING RATE FUND XXX XXXXXX PRIME RATE INCOME
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxxx
------------------------- -------------------------
Name: Xxxxx X. Xxxxxx Name: Xxxxxxx X. Xxxxxx
Title: Title: Senior Vice President
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XXXXXXX XXXXX PRIME RATE PORTFOLIO PILGRIM INVESTMENTS
By: Xxxxxxx Xxxxx Asset Management, L.P., as
investment advisor
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxxx Xxxxxx
------------------------- -------------------------
Name: Xxxxx X. Xxxxxx Name: Xxxxxxx Xxxxxx
Title: Title: Vice President
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ACKNOWLEDGMENT AND CONSENT
For the avoidance of doubt, and without limitation of the intent and effect
of sections 4 and 5 of the Subsidiary Guaranty (as such term is defined in the
Credit Agreement referred to in the Amendment No. 2 to Credit Agreement (the
"Amendment"), to which this Acknowledgment and Consent is appended), each of the
undersigned hereby unconditionally and irrevocably (i) acknowledges receipt of a
copy of the Credit Agreement and the Amendment, and (ii) consents to all of the
terms and provisions of the Credit Agreement as amended by the Amendment.
Capitalized terms which are used herein without definition shall have the
respective meanings ascribed thereto in the Credit Agreement referred to herein.
This Acknowledgment and Consent is for the benefit of the Lenders, the
Administrative Agent, the Collateral Agent and any Designated Hedge Creditor
(as defined in the Subsidiary Guaranty) which may be a third party beneficiary
of the Subsidiary Guaranty or any Security Document, in its capacity as such
third party beneficiary under any Credit Document, and their respective
successors and assigns. No term or provision of this Acknowledgment and Consent
may be modified or otherwise changed without the prior written consent of the
Administrative Agent, given as provided in the Credit Agreement. This
Acknowledgment and Consent shall be binding upon the successors and assigns of
each of the undersigned. This Acknowledgment and Consent may be executed by any
of the undersigned in separate counterparts, each of which shall be an original
and all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, each of the undersigned has duly executed and delivered
this Acknowledgment and Consent as of the date of the Amendment referred to
herein.
HI-STAT MANUFACTURING CO, INC.
By: /s/ Xxxxx Xxxxx
--------------------------
Vice President
