Exhibit 10.1

 

LIMITED WAIVER AND AMENDMENT NO. 1 TO SECOND AMENDED AND

RESTATED LOAN AND SECURITY AGREEMENT AND THE OTHER FINANCING

AGREEMENTS

 

This LIMITED WAIVER AND AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED LOAN AND
SECURITY AGREEMENT AND THE OTHER FINANCING AGREEMENTS (this “Amendment”) dated
as of September 1, 2004 is by and among Remy International, Inc. (f/k/a Delco
Remy International Inc.), a Delaware corporation (“Parent”), the following
Subsidiaries of Parent: Remy Inc. (f/k/a Delco Remy America, Inc.), a Delaware
corporation, Remy Sales, Inc. (f/k/a DR Sales, Inc.), a Delaware corporation,
Franklin Power Products, Inc., an Indiana corporation, HSG I, Inc, a Delaware
corporation, HSG II, Inc, a Delaware corporation, International Fuel Systems,
Inc., an Indiana corporation, JAX Reman, L.L.C., a Delaware limited liability
company, M. & M. Knopf Auto Parts, L.L.C., a Delaware limited liability company,
Nabco, Inc., a Michigan corporation, Powrbilt Products, Inc., a Texas
corporation, Remy Logistics, L.L.C., a Delaware limited liability company, Remy
Reman, L.L.C., a Delaware limited liability company, Williams Technologies,
Inc., a South Carolina corporation, World Wide Automotive, L.L.C., a Virginia
limited liability company (each individually, together with the Parent, a
“Borrower” and collectively, the “Borrowers”), Congress Financial Corporation
(Central), an Illinois corporation, as agent for Lenders referenced below (in
such capacity and as US Collateral Agent, as defined in the Loan Agreement
referenced below, the “Agent”), and the financial institutions (each
individually, a “Lender” and collectively, the “Lenders”) party to that certain
Second Amended and Restated Loan and Security Agreement, dated as of April 23,
2004 (as amended or otherwise modified prior to the date hereof, the “Loan
Agreement”). Capitalized terms used and not defined herein shall have the
meanings assigned to them in the Loan Agreement.

 

R E C I T A L S:

 

WHEREAS, Parent and Reman Holdings, L.L.C., a Delaware limited liability company
(“Reman Holdings”), as sellers, and Caterpillar Inc., a Delaware corporation, as
buyer (the “Buyer”), have entered into a Stock Purchase Agreement, dated as of
August 13, 2004 (as in effect on the date hereof, the “Stock Purchase
Agreement”) pursuant to which Parent and Reman Holdings agreed to sell, and the
Buyer agreed to buy, all of the outstanding shares of capital stock or other
equity interest in Williams Technologies, Inc., a South Carolina corporation
(“Williams Technologies”) and JAX Reman, L.L.C., a Delaware limited liability
company (“JAX”) and pursuant to which Williams Technologies agreed to acquire
all of the outstanding shares of capital stock or other equity interest in JAX
immediately prior to the closing of such sale (such sale by Parent and Reman
Holdings and such acquisition by Williams Technologies are herein collectively
referred to as the “Williams-JAX Sale”);

 

WHEREAS, Borrowers have requested that Agent and Lenders agree to certain
amendments to the Loan Agreements and the Financing Agreements as set forth
herein; and

 

WHEREAS, Agent and Lenders have agreed to such amendments upon the terms and
conditions contained herein.

 

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NOW, THEREFORE, in consideration of the premises contained herein, and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:

 

Section 1 Limited Waiver (Williams-JAX Sale). Immediately upon the satisfaction
of each of the conditions precedent set forth in Section 3 below, Agent and
Lenders hereby waive Section 9.7(b) of the Loan Agreement, but subject to clause
(viii) thereof as amended hereby, to the extent, and solely to the extent,
necessary to permit Parent and Reman Holdings to enter into an agreement to sell
the equity interests in Williams Technologies and JAX pursuant to the Stock
Purchase Agreement and to consummate the Williams-JAX Sale pursuant to and in
accordance with the Stock Purchase Agreement.

 

Section 2 Amendments to the Loan Agreement and the other Financing Agreements.
Immediately upon the satisfaction of each of the conditions precedent set forth
in Section 3 below, the Loan Agreement is hereby amended as follows:

 

(a) all references in the Financing Agreements to Williams Technologies, Inc., a
South Carolina corporation and JAX Reman, L.L.C., a Delaware limited liability
company are hereby deleted.

 

(b) Clause (viii) of Section 9.7(b) of the Loan Agreement is hereby amended by
amending and restating clause (C) thereof to read in its entirety as follows:

 

“(C) such amounts in the Blocked Account (or such other account) shall be
released from time to time provided that (1) Agent shall have received, prior to
the 360th day after receipt of the Net Available Cash, a certificate from Parent
stating that Parent or the applicable Restricted Subsidiary has invested (or has
entered into a binding commitment to invest; provided that such commitment shall
be subject only to customary conditions (other than financing) and such
investment shall be consummated within 365 days after the end of such 360-day
period) all such amounts released from the Blocked Account in Additional Assets
(as defined in the Indentures) within the 360-day period after receipt of the
Net Available Cash and (2) such amounts are released from the Blocked Account
(or such other account) solely to make such investment or investments or”

 

(c) The definition of “EBITDA” set forth in Section 1 of the Loan Agreement is
amended by deleting the word “and” before paragraph (vi) of clause (b) thereof
and by adding the word “and” and a new paragraph (vii) at the end paragraph (vi)
of clause (b) thereof, which paragraph (vii) shall read in its entirety as
follows:

 

  “(vii)

any gain or loss from the sale of the outstanding shares of capital stock or
other equity interest in Williams Technologies, Inc., a South Carolina
corporation and JAX

 

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Reman, L.L.C., a Delaware limited liability company to Caterpillar Inc., a
Delaware corporation;”

 

(d) Section 9.17 of the Loan Agreement is hereby amended by deleting the EBITDA
Levels for the months of August 31,2004 through and including March 31,2006 and
replacing them with new EBITDA Levels for such months as follows and by adding
EBITDA Levels for each month after March 31, 2006 as follows:

 

Month Ended

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   EBITDA

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August 31,2004

   96,000,000

September 30, 2004

   96,000,000

October 31,2004

   99,000,000

November 30, 2004

   99,000,000

December 31, 2004

   99,000,000

January 31, 2005

   100,000,000

February 28, 2005

   100,000,000

March 31, 2005

   100,000,000

April 30, 2005

   101,000,000

May 31, 2005

   101,000,000

June 30, 2005

   101,000,000

July 31, 2005

   102,000,000

August 31, 2005

   102,000,000

September 30, 2005

   102,000,000

October 31, 2005

   102,000,000

November 30, 2005

   102,000,000

December 31, 2005

   102,000,000

January 31, 2006

   117,000,000

February 28, 2006

   117,000,000

March 31,2006 and

each month thereafter

   117,000,000

 

(e) All references in the Financing Agreements (i) to Delco Remy International,
Inc., a Delaware corporation shall be deemed to be references to Remy
International, Inc., a Delaware corporation, (ii) to Remy International, Inc., a
Delaware corporation shall be deemed to be references to Remy International
Holdings, Inc., a Delaware corporation, (iii) to Delco Remy America, Inc., a
Delaware corporation shall be deemed to be references to Remy Inc., a Delaware
corporation, (iv) to DR Sales, Inc, a Delaware corporation shall be deemed to be
references to Remy Sales, Inc., a Delaware corporation, and (iv) to DR
Alternators, Inc., a Delaware corporation shall be deemed to be references to
Remy Alternators, Inc., a Delaware corporation.

 

(f) The definition of “Eligible Accounts” is hereby amended by adding the phrase
“Advance Stores Company, Incorporated” immediately after the phrase “AutoZone,
Inc.” in the last paragraph thereof.

 

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Section 3 Conditions to Effectiveness. The effectiveness of the waiver set forth
in Section 1 above and the amendments set forth in Section 2 above are subject
to the satisfaction of each of the following conditions:

 

(a) Agent shall have received a duly executed counterpart of this Amendment from
Borrowers and the Lenders;

 

(b) Agent shall have received a reaffirmation of guaranty from each guarantor of
the Obligations in form and substance satisfactory to the Agent;

 

(c) Agent shall have received a duly executed Williams-JAX paydown letter
agreement in the form of Exhibit A attached hereto and the Williams-JAX Paydown
Amount under and as defined therein;

 

(d) Agent shall have received a certificate of Parent to the effect that
attached thereto are true, correct and complete copies of the Stock Purchase
Agreement and all other agreements, documents and instruments executed and/or
delivered in connection therewith (including all exhibits, attachments and
schedules attached to any of the foregoing) requested by Agent; and

 

(e) The Williams-JAX Sale shall have been consummated in accordance with the
terms of the Stock Purchase Agreement.

 

Section 4 Representations, Warranties and Covenants. In order to induce Agent
and Lenders to enter into this Amendment, Borrowers represent, warrant and
covenant to Agent and Lenders, upon the effectiveness of this Amendment, which
representations, warranties and covenants shall survive the execution and
delivery of this Amendment that:

 

(a) No Default; etc. No Default or Event of Default has occurred and is
continuing after giving effect to this Amendment or would result from the
execution or delivery of this Amendment or the consummation of the transactions
contemplated hereby.

 

(b) Corporate or Limited Liability Company Power and Authority; Authorization.
Each Borrower has the power and authority to execute and deliver this Amendment
and to carry out the terms and provisions of the Financing Agreements, each as
amended by this Amendment, to which it is a party and the execution and delivery
by such Borrower of this Amendment, and the performance by such Borrower of its
obligations hereunder have been duly authorized by all requisite action by such
Borrower.

 

(c) Execution and Delivery. Each Borrower has duly executed and delivered this
Amendment.

 

(d) Enforceability. This Amendment and the Financing Agreements, each as amended
by this Amendment, constitute the legal, valid and binding obligations of each
Borrower, enforceable against each Borrower in accordance with their respective
terms, except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ right generally, and by general principles of equity.

 

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(e) Representations and Warranties. All of the representations and warranties
contained in the Financing Agreements (other than those which speak expressly
only as of a different date) are true and correct as of the date hereof after
giving effect to this Amendment and the transactions contemplated hereby.

 

Section 5 Miscellaneous.

 

(a) Effect; Ratification. Borrowers acknowledge that all of the reasonable legal
expenses incurred by U.S. Collateral Agent in connection herewith shall be
reimbursable under Section 9.21 of the Loan Agreement. The amendments and
consent set forth herein are effective solely for the purposes set forth herein
and shall be limited precisely as written, and shall not be deemed to (i) be a
consent to any amendment, waiver or modification of any other term or condition
of any Financing Agreement or (ii) prejudice any right or rights that any Lender
may now have or may have in the future under or in connection with any Financing
Agreement. Each reference in the Financing Agreements to “this Agreement”,
“herein”, “hereof” and words of like import shall mean such Financing Agreement
and Foreign Financing Agreement as amended hereby. This Amendment shall be
construed in connection with and as part of the Financing Agreements and all
terms, conditions, representations, warranties, covenants and agreements set
forth in the Financing Agreements, except as herein amended or waived are hereby
ratified and confirmed and shall remain in full force and effect.

 

(b) Counterparts; etc. This Amendment may be executed in any number of
counterparts, each such counterpart constituting an original but all together
one and the same instrument. Delivery of an executed counterpart of this
Amendment by fax shall have the same force and effect as the delivery of an
original executed counterpart of this Amendment. Any party delivering an
executed counterpart of this Amendment by fax shall also deliver an original
executed counterpart, but the failure to do so shall not affect the validity,
enforceability or binding effect of this Amendment.

 

(c) Governing Law. This Amendment shall be governed by, and construed and
interpreted in accordance with the internal laws of the State of New York but
excluding any principles of conflicts of law or other rule of law that would
cause the application of the law of any jurisdiction other than the laws of the
State of New York.

 

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, Agent, Lenders, and Borrowers have caused these presents to
be duly executed as of the day and year first above written.

 

BORROWERS

        REMY INTERNATIONAL, INC. (f/k/a Delco Remy International Inc.), as
President and Chief Executive Officer      

FRANKLIN POWER PRODUCTS, INC., as

Vice President and General Manager

M. & M. KNOPF AUTO PARTS, L.L.C., as

Vice Chairman

     

INTERNATIONAL FUEL SYSTEMS, INC., as

Vice President and General Manager

NABCO, INC., as Assistant Secretary      

POWRBILT PRODUCTS, INC., as

Vice President and General Manager

   

 

REMY REMAN, L.L.C., as

Assistant Secretary

                    By:   /s/    DAVID C. KEY                         David C.
Key

 

WILLIAMS TECHNOLOGIES, INC., as

Vice President

        By:   /s/    THOMAS J. SNYDER                         Thomas J. Snyder  
         

 

REMY INC. (f/k/a Delco Remy America, Inc.), as President

     

JAX REMAN, L.L.C., as Vice President,

Finance and Secretary

REMY SALES, INC.(f/k/a DR SALES, INC.), as President

     

REMY LOGISTICS, L.L.C., as Vice

President, Treasurer and Assistant Secretary

By:   /s/    RICHARD L. STANLEY                By:   /s/    ALLEN R. WILKIE
             Richard L. Stanley           Allen R. Wilkie

 

HSG I, INC., as President and Assistant Secretary

     

WORLD WIDE AUTOMOTIVE, L.L.C., as

Assistant Secretary

HSG II, INC., as President and Assistant Secretary

        By:   /s/    RODERICK ENGLISH               By:   /s/    ANDREW P.
GASSER             Roderick English           Andrew P. Gasser

 

[Signature Page to Amendment No. 1 to

Second Amended and Restated Loan and Security Agreement]

 

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AGENT

       

CONGRESS FINANCIAL CORPORATION (Central), as

Administrative Agent and US Collateral Agent

           

By:

  /s/    ANTHONY VIZGIRDA                    

Title:

  First Vice President

 

LENDERS

     

LENDERS

THE CIT GROUP/BUSINESS CREDIT, INC.

     

WACHOVIA BANK, NATIONAL ASSOCIATION

By:   /s/    BARBARA F. PERICH               By:   /s/    MARK FAGNIANI        
Title:   Vice President       Title:   Executive Vice President

 

FLEET CAPITAL CORPORATION

     

GMAC BUSINESS CREDIT, LLC

By:   /s/    DAVID LEHNER               By:   /s/    DANIEL J. MANELLA        
Title:   Vice President       Title:   Senior Vice President

 

NATIONAL CITY BANK

     

UPS CAPITAL CORPORATION

By:   /s/    THOMAS R. GROH               By:   /s/    JOHN P. HOLLOWAY        
Title:   S.V.P.       Title:   Director of Portfolio Management

 

RZB FINANCE LLC     By:   /s/    CHRISTOPH HOEDL          
/s/    JOHN A. VALISKA             CHRISTOPH HOEDL   John A. Valiska, Title:  
Vice President   Group Vice President

 

[Signature Page to Amendment No. 1 to

Second Amended and Restated Loan and Security Agreement]