Exhibit 10.1


 


WAIVER AND AMENDMENT NO. 1

TO SECOND AMENDED AND RESTATED CREDIT AND SECURITY AGREEMENT


 


 


This Waiver
and Amendment No. 1 to Second Amended and Restated Credit and Security Agreement (this “Amendment”), dated
as of March 8, 2012, is made by and among STONERIDGE, INC., an Ohio corporation (the “Parent”), STONERIDGE
ELECTRONICS, INC., a Texas corporation (“Electronics”), STONERIDGE CONTROL DEVICES, INC., a Massachusetts
corporation (“Controls”, and together with Parent and Electronics, the “Borrowers”), various
financial institutions which are a party to this Agreement (the “Lenders”), PNC Bank,
National Association, a national banking association (“PNC Bank”),
as Lead Arranger and Issuer (as hereinafter defined), and as administrative agent and collateral agent (the “Agent”)


 


WITNESSETH:


 


WHEREAS,
the Borrowers (as hereinafter defined) have been extended certain financial accommodations pursuant to that certain Second Amended
and Restated Credit and Security Agreement, dated as of December 1, 2011 (as further amended, supplemented, amended and restated
or otherwise modified from time to time, the “Credit Agreement”), among the Borrowers, various financial institutions
(the “Lenders”) and PNC Bank, as Lead Arranger, Issuer, and Agent;


 


WHEREAS,
the Borrowers consummated the PST Acquisition as of January 5, 2012;


 


WHEREAS,
the Borrowers have failed to deliver to the Agent within the time periods set forth for delivery in the Credit Agreement certain
documents in connection with the PST Acquisition in compliance with Section 7.1(g)(ii) (A), (B), (C) and (D), Section 9.16
and Section 9.17 of the Credit Agreement, which failures constitute Events of Default under Section 10.5 of the Credit
Agreement (collectively, the “PST Defaults”); 


 


WHEREAS,
the Borrowers have failed to deliver, within 30 days of the Closing Date, evidence to the Agent that the Scottish Borrower has
filed a form DTTP2 with the proper Governmental Body in the United Kingdom in accordance with Section 3.13(c) of the Credit
Agreement, which failure constitutes an Event of Default under Section 10.5 of the Credit Agreement (the “Filing
Default”, and collectively with the “PST Defaults”, the “Existing Defaults”);


 


WHEREAS,
the Borrowers have requested that the Lenders and the Agent waive the Existing Defaults;


 


WHEREAS,
the parties hereto desire to amend certain provisions of the Credit Agreement as outlined herein;


 


NOW THEREFORE,
in consideration of the mutual promises and agreements contained herein and other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, each of the parties hereto hereby agrees as follows:


 






    	 



    	 	



    
 


 


Section 1.DEFINED TERMS.


 


Each defined term
used herein and not otherwise defined herein shall have the meaning ascribed to such term in the Credit Agreement, as amended by
this Amendment.


 


Section 2AMENDMENT TO THE
CREDIT AGREEMENT


 


The Credit Agreement is
hereby amended as follows:


 


2.1 Amendment
to Section 3.13(c) -- Taxes; Withholding; Tax Indemnification. Section 3.13(c) of the Credit Agreement shall be amended
by deleting the penultimate paragraph thereof in its entirety.


 


2.2Amendment
to Section 7.1(g)(ii) -- Merger, Consolidation, Acquisition and Sale of Assets. Section 7.1(g)(ii) of the Credit Agreement
shall be amended by deleting subsections (A), (B), (C) and (D) thereof in their entirety and replacing them with the following
subsections (A), (B), (C) and (D) to read as follows:


 


(A)[Reserved.]


 


(B)by
March 2, 2012, a pro forma consolidated balance sheet of the Parent and its consolidated Subsidiaries (the “PST Acquisition
Pro Forma”), based on recent financial data from the fiscal quarter ending September 30, 2011, which shall be accurate
and complete in all material respects and shall fairly present the assets, liabilities and financial condition of the Parent and
its consolidated Subsidiaries in accordance with GAAP consistently applied, but taking into account the PST Acquisition and the
funding of all Advances in connection therewith, and (y) the PST Acquisition Pro Forma, together with the Pro Forma Borrowing Base
Certificate dated as of November 30, 2011, shall reflect that Undrawn Availability as of any day after the PST Acquisition
Date would be equal to or greater than Thirty Million Dollars ($30,000,000) on a pro forma basis (giving effect to the PST Acquisition
and all Advances made and Letters of Credit issued in connection therewith as if made or issued on the PST Acquisition Date), and
(z) on a pro forma basis (giving effect to the PST Acquisition and all Advances made and Letters of Credit issued in connection
therewith as if made on or before December 31, 2010), the Loan Parties would be in compliance with the financial covenant
regarding Fixed Charge Coverage Ratio set forth in Section 6.4, as if such financial covenant would be applicable notwithstanding
the fact that Undrawn Availability may be in excess of Twenty Million Dollars ($20,000,000), for a period of four trailing fiscal
quarters ending with each of the following fiscal quarters: the fiscal quarter ending December 31, 2010, the fiscal quarter
ending December 31, 2011, and the fiscal quarter ending December 31, 2012;


 


(C)by
March 2, 2012, updated versions of the most recently delivered projections under Section 9.11 covering a period of four
fiscal quarters, commencing with the fiscal quarter in which the PST Acquisition Date will occur and otherwise prepared in accordance
with the projections required to be delivered under Section 9.11 (the “PST Acquisition Projections”) and based
upon the financial statements (I) of the Parent and its consolidated Subsidiaries for Parent’s most recently completed fiscal
year and each fiscal quarter during the current fiscal year for which financial statements have been provided (or are required
to have been provided) pursuant to Sections 9.7 and 9.8, respectively, in relation to the date of such required delivery of
the PST Acquisition Projections, taking into account the PST Acquisition and (II) of PST for a period similar to the period described
in clause (I) above, with such projections being based on underlying assumptions and estimates which Parent reasonably believes
in good faith based on present circumstances of the most likely set of conditions and course of action for such projected period;
and


 






    	2



    	 



    
 


 


(D)by
March 6, 2012, a certificate of the chief financial officer of the Borrowing Agent to the effect that: (x) the Loan Parties
were solvent upon the PST Acquisition Date, (y) the PST Acquisition Pro Forma fairly presents the financial condition of the Parent
and its consolidated Subsidiaries as of the PST Acquisition Date thereof after giving effect to the PST Acquisition and the projected
repayment of a portion of the Obligations as of the PST Acquisition Date, and (z) the PST Acquisition Projections are based on
underlying assumptions and estimates which Parent reasonable believes in good faith based on present circumstances of the most
likely set of conditions and course of action for such projected period.


 


2.3Amendment
to Section 8.2 -- Conditions to Loans to Foreign Borrowers. Section 8.2 of the Credit Agreement shall be amended
by (i) deleting the last word (“and”) from subsection (o) thereof and (ii) by deleting subsection (p) thereof
in its entirety and replacing it with the following subsections (p) and (q) to read as follows:


 


		(p)	Form DTTP2. With respect to Revolving Advances to the Scottish Borrower only, the Agent
shall have received evidence, in form and substance reasonably satisfactory to the Agent, that the Scottish Borrower has completed
and filed a form DTTP2 with the proper Governmental Body in the United Kingdom; and



 


		(q)	Other. All corporate and other proceedings, and all documents, instruments and other legal
matters in connection with the transactions contemplated by this Agreement shall be satisfactory in form and substance to the Agent
and its counsel.



 


2.4Amendment
to Schedules to the Credit Agreement. Each of Schedule 4.14(j) (Securities Accounts), 5.2 (Incorporation/Organization/Formation),
5.5 (FEINS/Tax Returns), and 7.4 (Permitted Investments) to the Credit Agreement shall be amended by deleting each such existing
schedule in its entirety and replacing it with the respective corresponding schedule attached as Annex I to this Amendment.


 


Section 3WAIVER OF EXISTING DEFAULTS.


 






    	3



    	 



    



 


Upon satisfaction
of the conditions set forth in Section 5 hereof, the [Required] Lenders hereby waive the Existing Defaults and agree not to
enforce their rights and remedies under the Credit Agreement with respect to the Existing Defaults. In all other respects, each
of the Borrowers shall be and remain in full compliance with the Credit Agreement as amended by the provisions of this Amendment
and the foregoing waiver shall not extend to prejudice any rights of the Agent or the Lenders in respect of any other breach, if
any, by any Borrower of any other provisions of the Credit Agreement. The execution of this Amendment by each of the Borrowers
shall serve as an acknowledgment (i) that the foregoing waiver shall not affect the continued legality, validity and binding effect
of the Credit Agreement in its entirety and (ii) that the Credit Agreement continues to be fully enforceable in each case, except
as otherwise waived herein or as amended by the provisions of this Amendment.


 


Section 4REPRESENTATIONS AND WARRANTIES.


 


Each Borrower hereby
represents and warrants to the Lenders, the Agent and the Issuer as follows:


 


4.1The
Amendment. This Amendment has been duly and validly executed by an authorized executive officer of such Borrower and constitutes
the legal, valid and binding obligation of such Borrower enforceable against such Borrower in accordance with its terms. The Credit
Agreement, as amended by this Amendment, remains in full force and effect and remains the valid and binding obligation of such
Borrower enforceable against such Borrower in accordance with its terms, except as such enforceability may be limited by any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditor’s rights generally
or by equitable principles including principles of commercial reasonableness, good faith and fair dealing (whether enforceability
is sought by proceedings in equity or at law).


 


4.2No Default
or Event of Default. Except for the Existing Defaults, no Default or Event of Default exists under the Credit Agreement as
of the date hereof and no Default or Event of Default will occur as a result of the effectiveness of this Amendment.


 


4.3Restatement
of Representations and Warranties. The representations and warranties of such Borrower contained in the Credit Agreement, as
amended by this Amendment, and the Other Loan Documents are true and correct on and as of the Amendment Effective Date (as defined
below) of this Amendment as though made on the Amendment Effective Date, unless and to the extent that any such representation
and warranty is stated to relate solely to an earlier date, in which case such representation and warranty shall be true and correct
as of such earlier date.


 


Section 5CONDITIONS TO EFFECTIVENESS.


 


The date and
time of the effectiveness of this Amendment (the “Amendment Effective Date”) is subject to the satisfaction
of the following conditions precedent:


 






    	4



    	 



    
 


 


5.1Execution.
The Agent shall have received counterparts to this Amendment duly executed and delivered by an authorized officer of each other
party hereto;


 


5.2Certified
Copies of the PST Charter Documents. The Agent shall have received copies of the articles of association of PST certified by
the applicable Brazilian Governmental Body, and a copy of all other charter documents of PST, certified as being true, correct
and complete by an officer of the Parent;


 


5.3Certified
Copies of the PST Acquisition Documents. The Agent shall have received copies of the final executed and delivered PST Acquisition
Documents, each in form and substance reasonably satisfactory to the Agent, and certified as being true, correct and complete by
an officer of the Parent;


 


5.4Payment
of Costs and Expenses. The Borrowers shall have paid all outstanding and reasonable costs, expenses and the disbursements of
the Agent and its advisors, service providers and legal counsels incurred in connection with the documentation of this Amendment,
to the extent invoiced, as well as any other fees payable on or before the Amendment Effective Date pursuant to any fee letter
or agreement, if any, with the Agent; and


 


5.5Other.
All corporate and other proceedings, and all documents, instruments and other legal matters in connection with the transactions
contemplated by this Amendment shall be reasonably satisfactory in form and substance to the Agent and its counsel.


 


Section 6 COVENANTS.


 


The Borrowers
shall deliver to the Agent as soon as possible, and in any event within the time periods (unless extended by the Agent in its sole
discretion) specified below, the following, each in form and substance satisfactory to the Agent:


 


(a) No later than
April 30, 2012, evidence that the Borrowers have complied with the requirements in Section 6.8 of the Credit Agreement within
the time period set forth therein;


 


(b) No later than
April 30, 2012, to the extent required under applicable law, either (i) an executed amendment to the Amended and Restated Pledge
Agreement, dated as of December 15, 2011, among Alphabet Brasil, the Agent, and PST, such amendment to be in substantially the
same form as the amendment to the pledge agreement used to secure the 2010 Note Collateral Agent for the benefit of the 2010 Noteholders
or (ii) an executed pledge agreement among Alphabet Brasil, the Agent and PST, in substantially the same form as the pledge agreement
used to secure the 2010 Note Collateral Agent for the benefit of the 2010 Noteholders;


 


(c)Contemporaneously
with the execution and delivery of the documentation set forth in clause (b) above, a favorable opinion of counsel to Alphabet;
and


 






    	5



    	 



    
 


 


(d) All corporate
and other proceedings, and all documents, instruments and other legal matters in connection with the transactions contemplated
by this Section 6 shall be satisfactory in form and substance to the Agent and its counsel.


 


The failure of the Borrowers to
satisfy the requirements in this Section 6 on or before the time period applicable thereto as set forth herein (or such later date
as shall be consented to by the Agent in its sole discretion) shall constitute an immediate “Event of Default” under
the Credit Agreement, without the need for demand or notice of any kind.


 


Section 7 MISCELLANEOUS.


 


7.1Governing
Law. This Amendment shall be governed by and construed in accordance with the laws of the State of Ohio with out giving effect
to the conflict of laws rules thereof.


 


7.2Severability.
Any provision of this Amendment which is prohibited or unenforceable shall be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Amendment.


 


7.3Counterparts.
This 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 deemed to be an original, and all of which taken together shall constitute but one
and the same instrument.


 


7.4Headings.
Section headings used in this Amendment are for the convenience of reference only and are not a part of this Agreement for any
other purpose.


 


7.5Negotiations.
Each Borrower acknowledges and agrees that all of the provisions contained herein were negotiated and agreed to in good faith after
discussion with the Agent, the Issuer and the Lenders.


 


7.6Nonwaiver.
The execution, delivery, performance and effectiveness of this Amendment shall not, except as set forth in Section 3 of this
Amendment with respect to the Existing Defaults, operate as, or be deemed or construed to be, a waiver: (i) of any right, power
or remedy of the Lenders, the Issuer or the Agent under the Credit Agreement or the Other Loan Documents, or (ii) of any term,
provision, representation, warranty or covenant contained in the Credit Agreement or any Other Loan Document. Further, other than
as set forth in Section 3 of this Amendment with respect to the Existing Defaults, none of the provisions of this Amendment
shall constitute, be deemed to be or construed as, a waiver of any Default or Event of Default under the Credit Agreement as amended
by this Amendment.


 


7.7Reaffirmation.
Each Borrower hereby (i) ratifies and reaffirms all of its payment and performance obligations, contingent or otherwise, under
the Credit Agreement and each of the Other Loan Documents to which it is a party and (ii) ratifies and reaffirms its grant of security
interests and Liens under such documents and confirms and agrees that such security interests and Liens hereafter secure all of
the Obligations.


 






    	6



    	 



    
 


 


7.8 Release
of Claims. In consideration of the Lenders’, the Issuer’s and the Agent’s agreements contained in this Amendment,
each Borrower hereby irrevocably releases and forever discharge the Lenders, the Issuer and the Agent and their Affiliates, subsidiaries,
successors, assigns, directors, officers, employees, agents, consultants and attorneys (each, a “Released Person”)
of and from any and all claims, suits, actions, investigations, proceedings or demands, whether based in contract, tort, implied
or express warranty, strict liability, criminal or civil statute or common law of any kind or character, known or unknown, which
such Borrower ever had or now has against Agent, any Lender or any other Released Person which relates, directly or indirectly,
to any acts or omissions of Agent, any Lender or any other Released Person relating to the Credit Agreement or any Other Loan Document
on or prior to the date hereof.


 


7.9Reference
to and Effect on the Credit Agreement. Upon the effectiveness of this Amendment, each reference in the Credit Agreement to
“this Agreement,” “hereunder,” “hereof,” “herein,” or words of like import shall
mean and be a reference to the Credit Agreement as amended by this Amendment and each reference to the Credit Agreement in any
other document, instrument or agreement executed and/or delivered in connection with the Credit Agreement shall mean and be a reference
to the Credit Agreement, as amended by this Amendment.


 


[SIGNATURES FOLLOW]


 


 


 


 



    	7



    	 



    



 


 


Each of the
parties has signed this Amendment as of the day and year first above written.


 






 


	 	BORROWERS:
	 	 	 
	 	STONERIDGE, INC.
	 	 	 
	 	By:	/s/ George E. Strickler
	 	Name:	George E. Strickler
	 	Title: 	Executive Vice President, Chief Financial
	 	           	Officer and Treasurer
	 	 	 
	 	 	 
	 	STONERIDGE CONTROL DEVICES, INC.
	 	 	 
	 	By:	/s/ George E. Strickler
	 	Name:	George E. Strickler
	 	Title:  	Vice President and Treasurer
	 	 	 
	 	 	 
	 	STONERIDGE ELECTRONICS, INC.
	 	 	 
	 	By:	/s/ George E. Strickler
	 	Name:	George E. Strickler
	 	Title:   	Vice President and Treasurer
	 	 	 
	 	 	 
	 	 	 
	 	 	 















 






    	S-1



    	 



    
 


 





	 	AGENT:
	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION, as Agent
	 	 	 
	 	 	 
	 	By:	/s/ Joseph G. Moran
	 	Name:	Joseph G. Moran
	 	Title:	Senior Vice President
	 	 	 
	 	 	 
	 	ISSUERS:
	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION, as Issuer
	 	 	 
	 	 	 
	 	By:	/s/ Joseph G. Moran
	 	Name:	Joseph G. Moran
	 	Title:	Senior Vice President
	 	 	 
	 	 	 
	 	JPMORGAN CHASE BANK, N.A., as an Issuer
	 	 	 
	 	 	 
	 	By:	/s/ Katherine C. Cliffel
	 	Name:	Katherine C. Cliffel
	 	Title:	Vice President and Authorized Signor
	 	 	 







 


 



    	S-2



    	 



    
 


 





	 	LENDERS:
	 	 	 
	 	PNC BANK, NATIONAL ASSOCIATION, as a Lender
	 	 	 
	 	 	 
	 	 	 
	 	By:	/s/ Joseph G. Moran
	 	Name:	Joseph G. Moran
	 	Title: 	Senior Vice President
	 	 	 
	 	 	 
	 	COMERICA BANK., as a Lender
	 	 	 
	 	 	 
	 	By:	/s/ Brandon Welling
	 	Name:	Brandon Welling
	 	Title: 	Vice President
	 	 	 
	 	 	 
	 	J PMORGAN CHASE BANK, N.A., as a Lender
	 	 	 
	 	 	 
	 	By:	/s/ Katherine C. Cliffel
	 	Name:	Katherine C. Cliffel
	 	Title: 	Vice President and Authorized Signor
	 	 	 
	 	 	 
	 	FIFTH THIRD BANK, as a Lender
	 	 	 
	 	 	 
	 	By:	/s/ Marty McGinty
	 	Name: 	Marty McGinty
	 	Title:	Vice President







 


 






    	S-3



    	 



    
 


 





ANNEX I


 


[Updated Schedules to the Credit
Agreement]