EXHIBIT 10.1
FOURTH AMENDMENT AND WAIVER TO
CREDIT AGREEMENT
This FOURTH AMENDMENT AND WAIVER TO
CREDIT AGREEMENT (“ Amendment ”) is dated as of
June 25, 2009, but is effective as of May 2, 2009, among
METHODE ELECTRONICS, INC., a Delaware corporation (the “
Borrower ”), each lender party hereto, and BANK OF
AMERICA, N.A., as Administrative Agent, and L/C Issuer.
WHEREAS, the Borrower, each lender
from time to time party thereto (collectively, the “
Lenders ” and individually, a “ Lender
”) and Bank of America, N.A., as Administration Agent and L/C
Issuer are parties to that certain Credit Agreement, dated as of
December 19, 2002, as amended by the Amendment to Credit
Agreement dated as of November 3, 2005, the Amendment to
Credit Agreement dated as of January 31, 2006 and the Waiver
and Amendment dated as of February 28, 2007 (the “
Existing Credit Agreement ,” and as amended and
modified by this Amendment and any future amendments, restatements,
supplements and modifications thereto, the “ Credit
Agreement ”) (terms defined in the Credit Agreement shall
have the same respective meanings when used herein);
WHEREAS, the Borrower has requested
that Agent and Lenders agree to waive the Events of Default as a
result of the Borrower’s non-compliance with
Section 6.02(b) and Section 7.13(b) of the
Existing Credit Agreement for the fiscal quarter ended
January 31, 2009 and amend the Credit Agreement in certain
respects, all as more fully hereinafter set forth, and
WHEREAS, Agent and Required Lenders
are willing to waive such Events of Default and amend and modify
the Existing Credit Agreement, effective as of May 2, 2009
(except as otherwise indicated herein), on the terms and conditions
contained herein.
NOW THEREFORE, in consideration of
the mutual covenants and agreements herein contained, the parties
hereto covenant and agree as follows:
ARTICLE I
WAIVERS
Subject to the satisfaction of the
conditions precedent set forth in Article IV of this
Amendment, the Agent and Lenders hereby waive the Borrower’s
non-compliance with Section 6.02(b) and
Section 7.13(b) of the Existing Credit Agreement, solely
with respect to the Borrower’s fiscal quarter ended
January 31, 2009. The Borrower agrees that the foregoing
waivers are specific in time and in intent and do not constitute,
nor shall they be construed as, a waiver of any other right, power
or privilege under the Existing Credit Agreement, any of the other
Loan Documents or under any agreement, contract, indenture,
document or other instrument executed and delivered in connection
with the Loan Documents; nor shall the waiver contained in this
Article 1 constitute a waiver of any other Default or Event of
Default of any
other term or provision under the Existing
Credit Agreement or any of the other Loan Documents.
ARTICLE II
AMENDMENT
2.01.
Effective as of March 15, 2009,
Section 1.1 of the Credit Agreement is amended so that the
definition of “Applicable Rate” shall be amended
prospectively from such date as follows:
“ Applicable Rate
” means as to (i) any Eurodollar Rate Loan or Letter of
Credit, a margin per annum equal to 2.75%, (ii) any Base Rate
Loan, a margin per annum equal to 1.50% and (iii) the
Commitment Fee, a margin per annum equal to 0.50%.
2.02.
Section 1.1 of the Credit
Agreement is amended so that the definition of “Consolidated
Debt to EBITDA Ratio” shall read in its entirety as
follows:
“ Consolidated Debt to
EBITDA Ratio ” means as of any date of determination, the
ratio of (i) Net Consolidated Indebtedness on such date to
(ii) Consolidated EBITDA for the most recent period of twelve
consecutive fiscal months then ended, to be reported by Borrower
for each fiscal month in a monthly Compliance Certificate; provided
that in the case of any fiscal month ending prior to
October 31, 2009, the Consolidated Debt to EBITDA Ratio shall
be calculated by annualizing the Consolidated EBITDA component of
such calculation for the period from November 2, 2008 to the
measurement date.
2.03.
Section 1.1 of the Credit
Agreement is amended so that the definition of “Consolidated
EBITDA” shall read in its entirety as follows:
“ Consolidated EBITDA
” means, for any period, for the Borrower and its
Subsidiaries on a consolidated basis, an amount equal to the sum of
(a) Consolidated Net Income, (b) Consolidated Interest
Charges, (c) the amount of taxes, based on or measured by
income, used or included in the determination of such Consolidated
Net Income, and (d) the amount of depreciation and
amortization expense deducted in determining such Consolidated Net
Income, (e) cash restructuring charges deducted in determining
such Consolidated Net Income in an aggregate amount not to exceed
$12,000,000 during the term of this Agreement, (f) the amount
of non-cash restructuring and non-cash goodwill and intangible
asset impairment charges deducted in determining such Consolidated
Net Income.
2.04.
Section 1.1 of the Credit
Agreement is amended by adding a definition of “Consolidated
Interest Coverage Ratio” as follows:
“ Consolidated Interest
Coverage Ratio ” means, as of any date of determination,
the ratio of (a) Consolidated EBITDA for the period of the
four
2
prior fiscal quarters ending on such
date to (b) Consolidated Interest Charges paid in cash for
such period; provided that for the fiscal quarter ending nearest
July 31, 2009, the measurement period for both components
shall be the prior three fiscal quarters ending on such
date.
2.05.
Section 1.1 of the Credit
Agreement is amended to delete the definition of
“Consolidated Fixed Charge Coverage Ratio”.
2.06.
Section 1.1 of the Credit
Agreement is amended by adding a definition of “Net
Consolidated Indebtedness” as follows:
“ Net Consolidated
Indebtedness ” means at any time total Indebtedness of
the Borrower and its Subsidiaries minus an amount equal to
33% of the aggregate amount of unencumbered cash or Investments in
cash equivalents of the Borrower and its Subsidiaries; provided
that if the result of such subtraction is negative, the amount
shall be zero.
2.07.
Section 6.02(b) of the
Credit Agreement is amended to read in its entirety as
follows:
(b)
concurrently with the delivery of
the financial statements referred to in
Sections 6.01(a) and (b) , and within 30
days after the end of any fiscal month of the Borrower that is not
a fiscal year or fiscal quarter end, a duly completed Compliance
Certificate signed by a Responsible Officer of
