Exhibit 10.1
Execution Copy
SECOND AMENDMENT TO CREDIT AGREEMENT
This SECOND AMENDMENT TO MULTICURRENCY REVOLVING CREDIT AND TERM LOAN AGREEMENT
(this “Second Amendment”) is made and entered into as of the 29th day of
December, 2010, by and among LOJACK CORPORATION (“LoJack”), the Subsidiaries
listed on Schedule 1 to the Credit Agreement referred to below (collectively
with LoJack, and together with the other Persons that from time to time become
Borrowers pursuant to the provisions of the Credit Agreement, the “Borrowers”),
the Guarantors listed on Schedule 1 to the Credit Agreement (collectively with
the other Persons that from time to time become Guarantors pursuant to the
provisions of the Credit Agreement, the “Guarantors”), the Lenders listed on
Schedule 2 to the Credit Agreement (collectively, the “Lenders”), RBS CITIZENS,
N.A., as Administrative Agent for itself and each of the other Lenders from time
to time party to the Credit Agreement (the “Agent”) and Lead Arranger, and TD
BANK, N.A., as Issuing Bank. Capitalized terms used herein without definition
shall have the respective meaning assigned to such terms in the Credit
Agreement.
WHEREAS, the Borrowers, the Guarantors, the Lenders and the Agent are party to
that certain Multicurrency Revolving Credit Agreement, dated as of December 29,
2009 (as the same may be amended and in effect from time to time, the “Credit
Agreement”), pursuant to which the Lenders have extended credit to the Borrowers
on the terms set forth therein;
WHEREAS, the Borrowers and the Guarantors have requested certain amendments to
the Credit Agreement including, but not limited to, the extension of the
Maturity Date until January 10, 2014; and
WHEREAS, the Agent and the Required Lenders are willing to make such amendments
to the Credit Agreement on the terms set forth herein.
NOW, THEREFORE, in consideration of the foregoing, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
I. DEFINITIONS.
Capitalized terms used herein without definition shall have the meanings
assigned to such terms in the Credit Agreement. This Second Amendment shall
constitute a Loan Document for all purposes of the Credit Agreement and the
other Loan Documents.

 

 

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II. AMENDMENTS TO CREDIT AGREEMENT.
Effective as of the Second Amendment Date (as defined below), the Credit
Agreement is hereby amended as follows:
(1) Amendments to Section 1.1 (Definitions) of the Credit Agreement. Section 1.1
of the Credit Agreement is hereby amended as follows:
(a) The table set forth in the definition of “Applicable Margin” is hereby
deleted, and the following is inserted in lieu thereof:

                                              Applicable Margin                
  Consolidated Funded     For Eurodollar Rate     Applicable Margin            
Debt to Consolidated     Loans and Standby     For Base Rate         Level  
EBITDA Ratio     Letters of Credit     Loans     Commitment Fee  
I
  > 1.75:1       3.250 %     1.000 %     0.500 %
II
  ≥ 1.25:1 and ≤ 1.75:1       3.000 %     0.500 %     0.375 %
III
  < 1.25:1       2.750 %     0.000 %     0.250 %

(b) The definition of “Consolidated EBITDA” is hereby amended by inserting the
following paragraph at the end thereof:
“For the purposes of calculating the financial covenants set forth in Article 10
hereof or otherwise, Consolidated EBITDA may be further adjusted from time to
time with the consent of the Required Lenders.”
(c) The definition of “Interest Payment Date” is hereby amended by inserting the
following clause (c) at the end thereof:
“and (c) as to any Eurodollar Rate Loan having an Interest Period of greater
than three months, the date that is three months following the beginning of such
Interest Period and the last Business Day of the applicable Interest Period.”
(d) The definition of “Maturity Date” is hereby amended by deleting the
reference therein to “the second (2nd) anniversary of the Closing Date” and
inserting the following in place thereof: “January 10, 2014.”
(e) The following definition of “Second Amendment Date” is hereby inserted in
the correct alphabetical position:
“Second Amendment Date. Means December 29, 2010.”
(2) Amendment to Section 2.2.1(b)(iii) of the Credit Agreement.
Section 2.2.1(b)(iii) of the Credit Agreement is hereby deleted, and the
following is inserted in lieu thereof:
“(iii) the expiry date of such Letter of Credit would occur after the Letter of
Credit Expiration Date, unless the Issuing Bank has agreed to such expiry date
and the Borrowers have posted cash collateral covering 105% of the face amount
of such Letter of Credit in a manner acceptable to the Agent and the Issuing
Bank;”
(3) Amendment to Section 7.2 (Subsidiaries) of the Credit Agreement. The first
parenthetical in Section 7.2 of the Credit Agreement is hereby deleted, and the
following is inserted in lieu thereof:
“(as the same may be deemed amended from time to time pursuant to § 8.9 hereof
or as otherwise agreed to by the Required Lenders, the “Disclosure Letter”)”

 

 

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(4) Amendment to Section 9.10 (No Stock Repurchase) of the Credit Agreement. The
proviso set forth in Section 9.10 of the Credit Agreement is hereby deleted, and
the following is inserted in lieu thereof:
“provided, that, so long as no Default or Event of Default exists or would
otherwise be created by the consummation of such a repurchase transaction,
LoJack may repurchase Capital Stock not exceeding $10,000,000 in the aggregate
for the period commencing on the Second Amendment Date and ending on the
Maturity Date.”
(5) Amendment to Schedule 2.1 (Authorized Representatives) to the Credit
Agreement. Schedule 2.1 to the Credit Agreement is hereby deleted and replaced
with the restated Schedule 2.1 attached as Annex A hereto.
III. CONDITIONS TO EFFECTIVENESS:
This Second Amendment shall become effective when each of the following
conditions is met thereto (the “Second Amendment Date”):
(1) receipt by the Agent of this Second Amendment, duly and properly authorized,
executed and delivered by each of the respective parties;
(2) receipt by the Agent of certified copies of any amendments to the charter,
articles of incorporation and bylaws (or comparable organizational documents for
the applicable jurisdiction) of the Loan Parties executed since the Closing
Date, certified in each instance by its Secretary, Assistant Secretary or other
duly authorized officer of such Loan Party;
(3) receipt by the Agent of copies of resolutions of the Board of Directors of
the Loan Parties (or similar governing body) authorizing the execution, delivery
and performance of this Second Amendment and the consummation of the
transactions contemplated hereby, together with specimen signatures of the
persons authorized to execute this Second Amendment on its behalf, all certified
in each instance by its Secretary, Assistant Secretary or other duly authorized
officer of such Loan Party;
(4) receipt by the Agent of the certificates of good standing for each of the
Loan Parties (or the substantive equivalent certificates for Loan Parties
outside of the United States) from the office of the secretary of the state of
its incorporation or organization and of each state or jurisdiction in which it
is qualified to do business as a foreign corporation or organization;
(5) receipt by the Agent of copies of UCC and other appropriate search reports
(including Intellectual Property) covering, in the case of each search, the
period from the date of the most recent search of that type delivered to the
Agent through a recent date; and
(6) receipt by the Agent of an upfront commitment fee equal to $75,000 for the
account of the Lenders, which fee shall be nonrefundable for any reason
whatsoever and shall be in addition to any other fees, costs and expenses
payable pursuant to the Credit Agreement and in connection with this Second
Amendment.

 

 

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IV. REPRESENTATIONS AND WARRANTIES:
Each of the Borrowers and the Guarantors represent and warrant to the Agent and
the Lenders as follows:
(1) The execution, delivery and performance of this Second Amendment and the
transactions contemplated hereby (i) are within the corporate authority of each
Borrower and Guarantor, (ii) have been duly authorized by all necessary
corporate proceedings of each Borrower and Guarantor, (iii) do not conflict with
or result in any breach or contravention of any provision of law, statute, rule
or regulation to which any Borrower or Guarantor is subject or any judgment,
order, writ, injunction, license or permit applicable to any Borrower or
Guarantor, and (iv) do not conflict with any provision of the governing
documents of any Borrower or Guarantor.
(2) The execution, delivery and performance of this Second Amendment, and the
Credit Agreement as amended hereby, will result in valid and legally binding
obligations of each Borrower and Guarantor enforceable against each of them in
accordance with the respective terms and provisions hereof and thereof, except
as enforceability is limited by bankruptcy, insolvency, reorganization,
moratorium or other laws relating to or affecting generally the enforcement of
creditors’ rights and except to the extent that availability of the remedy of
specific performance or injunctive relief or other equitable remedy is subject
to the discretion of the court before which any proceeding therefor may be
brought.
(3) The execution, delivery and performance by the Borrowers and the Guarantors
of this Second Amendment does not require any approval or consent of, or filing
with, any governmental agency or authority other than those already obtained, if
any.
(4) The representations and warranties contained in Section 7 of the Credit
Agreement are true and correct in all material respects (if not qualified as to
materiality or Material Adverse Effect) or in any respect (if so qualified) as
of the Second Amendment Date as though made on and as of the Second Amendment
Date, except to the extent that such representations and warranties specifically
refer to an earlier date, in which case they shall be true and correct as of
such earlier date.
(5) After giving effect to this Second Amendment, no Default or Event of Default
under the Credit Agreement has occurred and is continuing.

 

 

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V. MISCELLANEOUS:
(1) Ratification, Etc. Except as expressly amended hereby, the Credit Agreement,
the other Loan Documents and all documents, instruments and agreements related
thereto are hereby ratified and confirmed in all respects and shall continue in
full force and effect. This Second Amendment and the Credit Agreement shall
hereafter be read and construed together as a single document, and all
references in the Credit Agreement, any other Loan Document or any agreement or
instrument related to the Credit Agreement shall hereafter refer to the Credit
Agreement as amended by this Second Amendment.
(2) Guarantor Consent. Each of the undersigned Guarantors has guaranteed all of
the Obligations under (and as defined in) the Credit Agreement. By executing
this Second Amendment, each Guarantor hereby absolutely and unconditionally
reaffirms to the Lenders that such Guarantor’s Guaranty remains in full force
and effect and covers all Obligations under the Credit Agreement. In addition,
each Guarantor hereby acknowledges and agrees to the terms and conditions of
this Second Amendment (including, without limitation, the making of the
representations and warranties and the performance of the covenants applicable
herein).
(3) Governing Law. THIS SECOND AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS.
(4) Counterparts. This Second Amendment may be executed in any number of
counterparts and by different parties hereto on separate counterparts, each of
which when so executed and delivered shall be an original, but all of which
counterparts taken together shall be deemed to constitute one and the same
instrument. This Second Amendment, to the extent signed and delivered by means
of a facsimile machine or other electronic transmission in which the actual
signature is evident, shall be treated in all manner and respects as an original
agreement or instrument and shall be considered to have the same binding legal
effect as if it were the original signed version thereof delivered in person. At
the request of any party hereto, each other party hereto or thereto shall
re-execute original forms hereof and deliver them to all other parties. No party
hereto shall raise the use of a facsimile machine or other electronic
transmission in which the actual signature is evident to deliver a signature or
the fact that any signature or agreement or instrument was transmitted or
communicated through the use of a facsimile machine or other electronic
transmission in which the actual signature is evident as a defense to the
formation of a contract and each party forever waives such defense.

 

 

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IN WITNESS WHEREOF, each of the undersigned has duly executed this Second
Amendment to Credit Agreement as of the date first set forth above.

            BORROWERS:

LOJACK CORPORATION
      By:   /s/ Timothy P. O’Connor         Name:   Timothy P. O’Connor       
Title:   Executive Vice President and
Chief Financial Officer        LOJACK GLOBAL LLC
      By:   /s/ Timothy P. O’Connor         Name:   Timothy P. O’Connor       
Title:   Executive Vice President and
Chief Financial Officer        LOJACK OPERATING COMPANY, L.P.
      By:   LoJack Corporation, its General Partner             By:   /s/
Timothy P. O’Connor         Name:   Timothy P. O’Connor        Title:  
Executive Vice President and
Chief Financial Officer        LOJACK SAFETYNET, INC.
      By:   /s/ Timothy P. O’Connor         Name:   Timothy P. O’Connor       
Title:   Treasurer        BOOMERANG TRACKING, INC.
      By:   /s/ Timothy P. O’Connor         Name:   Timothy P. O’Connor       
Title:   Vice President and Treasurer   

Signature Page to Citizens/LoJack Second Amendment

 

 

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            GUARANTOR:

LSC LOCATOR SYSTEMS INTERNATIONAL CORP.
      By:   /s/ Timothy P. O’Connor         Name:   Timothy P. O’Connor       
Title:   Treasurer   

Signature Page to Citizens/LoJack Second Amendment

 

 

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            LENDERS:

RBS CITIZENS, N.A.
as Lender and Agent
      By:   /s/ David J. Bugbee         Name:   David J. Bugbee        Title:  
Senior Vice President   

Signature Page to Citizens/LoJack Second Amendment

 

 

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            TD BANK, N.A.,
as Lender and Issuing Bank
      By:   /s/ Meg D. McIsaac         Name:   Meg D. McIsaac   

Signature Page to Citizens/LoJack Second Amendment

 

 

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ANNEX A
Schedule 2.1 to the Credit Agreement
Richard T. Riley
Timothy P. O’Connor
John Barrett
Betsy Marble