**Exhibit 10.30**

 

**FOURTHAMENDMENT 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 timeparty thereto (collectively, the “Lenders” and individually, a “Lender”)and Bank of America, N.A., as Administration Agent and L/C Issuer are partiesto that certain Credit Agreement, dated as of December 19, 2002, asamended by the Amendment to Credit Agreement dated as of November 3, 2005,the Amendment to Credit Agreement dated as of January 31, 2006 and theWaiver and Amendment dated as of February 28, 2007 (the “ExistingCredit Agreement,” and as amended and modified by this Amendment and anyfuture amendments, restatements, supplements and modifications thereto, the “CreditAgreement”) (terms defined in the Credit Agreement shall have the samerespective meanings when used herein);

 

WHEREAS, the Borrower has requested that Agent andLenders agree to waive the Events of Default as a result of the Borrower’snon-compliance with Section 6.02(b) and Section 7.13(b) ofthe Existing Credit Agreement for the fiscal quarter ended January 31,2009 and amend the Credit Agreement in certain respects, all as more fullyhereinafter set forth, and

 

WHEREAS, Agent and Required Lenders are willing towaive such Events of Default and amend and modify the Existing CreditAgreement, effective as of May 2, 2009 (except as otherwise indicatedherein), on the terms and conditions contained herein.

 

NOW THEREFORE, in consideration of the mutualcovenants and agreements herein contained, the parties hereto covenant andagree as follows:

 

**ARTICLE IWAIVERS**

** **

Subject to the satisfaction of the conditionsprecedent set forth in Article IV of this Amendment, the Agent and Lendershereby waive the Borrower’s non-compliance with Section 6.02(b) and Section 7.13(b) ofthe Existing Credit Agreement, solely with respect to the Borrower’s fiscalquarter ended January 31, 2009.  TheBorrower agrees that the foregoing waivers are specific in time and in intentand do not constitute, nor shall they be construed as, a waiver of any otherright, power or privilege under the Existing Credit Agreement, any of the otherLoan Documents or under any agreement, contract, indenture, document or otherinstrument executed and delivered in connection with the Loan Documents; norshall the waiver contained in this Article 1 constitute a waiver of anyother Default or Event of Default of any other term or provision under theExisting Credit Agreement or any of the other Loan Documents.

 

----

** **

**ARTICLE IIAMENDMENT**

** **

2.01.        Effective as of March 15,2009, Section 1.1 of the Credit Agreement is amended so that thedefinition of “Applicable Rate” shall be amended prospectively from such dateas follows:

 

“Applicable Rate” means as to (i) any Eurodollar Rate Loanor Letter of Credit, a margin per annum equal to 2.75%, (ii) any Base RateLoan, a margin per annum equal to 1.50% and (iii) the Commitment Fee, amargin per annum equal to 0.50%.

 

2.02.        Section 1.1 of theCredit Agreement is amended so that the definition of “Consolidated Debt toEBITDA Ratio” shall read in its entirety as follows:

 

“ConsolidatedDebt to EBITDA Ratio” means as of any date of determination, the ratio of (i) NetConsolidated Indebtedness on such date to (ii) Consolidated EBITDA for themost recent period of twelve consecutive fiscal months then ended, to bereported 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 annualizingthe Consolidated EBITDA component of such calculation for the period from November 2,2008 to the measurement date.

 

2.03.        Section 1.1 of theCredit 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 consolidatedbasis, an amount equal to the sum of (a) Consolidated Net Income, (b) ConsolidatedInterest 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) theamount of depreciation and amortization expense deducted in determining suchConsolidated Net Income, (e) cash restructuring charges deducted indetermining 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-cashrestructuring and non-cash goodwill and intangible asset impairment charges deductedin determining such Consolidated Net Income.

 

2.04.        Section 1.1 of theCredit Agreement is amended by adding a definition of “Consolidated InterestCoverage Ratio” as follows:

 

“Consolidated Interest Coverage Ratio”means, as of any date of determination, the ratio of (a) ConsolidatedEBITDA for the period of the four prior fiscal quarters ending on such date to (b) ConsolidatedInterest Charges paid in cash for such period; provided that for the fiscalquarter ending nearest July 31, 

 

2

----

 

2009, the measurement periodfor both components shall be the prior three fiscal quarters ending on suchdate.

 

2.05.        Section 1.1 of theCredit Agreement is amended to delete the definition of “Consolidated Fixed ChargeCoverage Ratio”.

 

2.06.        Section 1.1 of theCredit Agreement is amended by adding a definition of “Net ConsolidatedIndebtedness” as follows:

 

“Net ConsolidatedIndebtedness” means at any time total Indebtedness of the Borrower and itsSubsidiaries *minus* an amountequal to 33% of the aggregate amount of unencumbered cash or Investments incash equivalents of the Borrower and its Subsidiaries; provided that if theresult of such subtraction is negative, the amount shall be zero.

 

2.07.        Section 6.02(b) ofthe Credit Agreement is amended to read in its entirety as follows:

 

(b)           concurrently with thedelivery 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 theBorrower that is not a fiscal year or fiscal quarter end, a duly completedCompliance Certificate signed by a Responsible Officer of the Borrower;

 

2.08.        Section 7.07(d) ofthe Credit Agreement is amended to read in its entirety as follows:

 

(d)           the Borrower may declare orpay cash dividends to its stockholders provided that immediately before andafter giving effect to such declaration or payment, (i) no Default orEvent of Default would exist and (ii) the Borrower’s Consolidated Debt toEBITDA Ratio is less than 1.50:1.00, and

 

2.09.        Section 7.07(e) ofthe Credit Agreement is amended to read in its entirety as follows:

 

(e)           the Borrower may purchase orotherwise acquire shares of its capital stock or warrants, rights or options toacquire any such shares for cash (individually, a “Share Repurchase” andcollectively, the “Share Repurchases”), provided that (1) anyshares of the Borrower’s capital stock, warrants, rights or options sopurchased or acquired shall be retired concurrently with such purchase oracquisition (or held by the Borrower thereafter as treasury shares), (2) immediatelybefore and after giving effect to any such Share Repurchase pursuant to this Section 7.07(e),(i) no Default or Event of Default would exist, and (ii) the Borrower’sConsolidated Debt to EBITDA Ratio is less than 1.50:1.00.

 

3

----

 

2.10.        Section 7.13 of theCredit Agreement is amended to read in its entirety as follows:

 

**7.13  Financial Covenants****.**

 

(a) **Consolidated Net Worth**.  Permit Consolidated Net Worth as of the endof any fiscal quarter of the Borrower to be less than the sum of (a) 85%of Consolidated Net Worth as of May 2, 2009, plus (b) an amount equalto 50% of the Consolidated Net Income earned in each fiscal quarter endingafter May 2, 2009 (with no deduction for a net loss in any such fiscalquarter), plus (c) an amount equal to 100% of the aggregate cumulative netproceeds of any Equity Issuance after May 2, 2009; minus (d) theamount of non-cash restructuring and non-cash goodwill and intangible assetimpairment charges deducted in determining Consolidated Net Income after May 2,2009.

 

(b)  **Consolidated InterestCoverage Ratio**.  Beginningwith the fiscal quarter ending nearest July 31, 2009, permit theConsolidated Interest Coverage Ratio as of the end of any fiscal quarter of theBorrower to be less than 3.50:1.00.

 

(c)  **Consolidated Debt toEBITDA Ratio. **Beginningwith the fiscal month ending May 2, 2009, permit its Consolidated Debt toEBITDA Ratio as of the end of any fiscal month of the Borrower to exceed2.50:1.

 

2.11.        The Credit Agreement isfurther amended so that Exhibit C shall read in its entirety as set forthin Schedule 1 attached hereto:

 

**ARTICLE IIIREPRESENTATIONS AND WARRANTIES**

** **

The Borrower hereby represents and warrants to theAdministrative Agent and the Lenders that:

 

3.01.        After giving effect to thisAmendment, the representations and warranties of the Borrower set forth in Article Vof the Credit Agreement are true and correct as of the date hereof as thoughmade on the date hereof and as though applied to the Credit Agreement asamended by this Amendment (except to the extent that such representations andwarranties specifically refer to an earlier date, in which case they are trueand correct as of such earlier date, and except that for purposes of this Section 3.01,the representations and warranties contained in Section 5.05(a) and (b) ofthe Credit Agreement shall be deemed to refer to the most recent statementsfurnished pursuant to Section 6.01 (a) and (b) of the CreditAgreement).

 

3.02.        After giving effect to thisAmendment, no Default or Event of Default has occurred and is continuing.

 

4

----

** **

**ARTICLE IVCONDITIONS PRECEDENT**

** **

This Amendment shall become effective as of May 2,2009 (or in the case of Section 2.01 hereof, effective as of March 15,2009), upon receipt by the Administrative Agent of all of the following in formand substance satisfactory to the Administrative Agent:

 

4.01.        counterparts of this Amendment and Acknowledgement(or an executed facsimile copy hereof and thereof), executed by the Borrower,the Required Lenders and the Guarantors, respectively;

 

4.02.        a Guaranty Supplement in theform attached to this Amendment;

 

4.03.        a duly completed ComplianceCertificate for the Borrower’s fiscal quarter ended January 31, 2009;

 

4.04.        for the ratable account ofeach Lender which executes and delivers its signature page hereto as andwhen required by the Administrative Agent, an amendment fee equal to 0.10% of suchLender’s Commitment;

 

4.05.        evidence of the payment tothe Administrative Agent in immediately available funds of all reasonable legalfees and expenses of the Administrative Agent to the extent theretoforeinvoiced;

 

4.06.        a certificate of the Secretaryor the Assistant Secretary each of the Borrower and its Domestic Subsidiariesas to resolutions, and the signatures and incumbency of officers authorized tosign this Amendment; and

 

4.07.        such other documents as theAdministrative Agent shall require.

 

**ARTICLE V**

** **

**GENERAL**

** **

5.01.        As amended or modified bythis Amendment, the Loan Documents shall remain in full force and effect.  References to the Credit Agreement in any ofthe Loan Documents shall be deemed to include a reference to the CreditAgreement as amended or modified hereby, whether or not reference is made tothis Amendment.  Section headingsused in this Amendment are for convenience of reference only, and shall notaffect the construction of this Amendment.

 

5.02.        This Amendment may beexecuted in any number of counterparts (each of which shall be deemed anoriginal, but all such counterparts together shall constitute but one and thesame instrument).

 

5

----

 

5.03.        The Borrower agrees to payto or reimburse the Administrative Agent, upon demand, for all reasonable costsand expenses incurred (including legal expenses) in connection with thedevelopment, preparation, negotiation, execution and delivery of thisAmendment.

 

5.04.        All obligations of the Borrowerand rights of the Administrative Agent and the Lenders, that are expressedherein, shall be in addition to and not in limitation to those provided byapplicable law.  This Amendment shall bea contract made under and governed by the internal laws of the State ofIllinois, without giving effect to principles of conflicts of laws.  Whenever possible, each provision of thisAmendment shall be interpreted in such manner as to be effective and validunder applicable law; but if any provision of this Amendment shall beprohibited by or invalid under applicable law, such provision shall beineffective to the extent of such prohibition or invalidity, withoutinvalidating the remainder of such provision or the remaining provisions ofthis Amendment.

 

5.05.        The Borrower acknowledgesand agrees that the execution and delivery by the Administrative Agent and theRequired Lenders of this Amendment shall not be deemed to create a course ofdealing or otherwise obligate the Lenders to forbear or execute similar amendmentsunder the same or similar circumstances in the future.

 

5.06.        This Amendment shall bebinding upon and inure to the benefit of the parties hereto and theirrespective successors and assigns.  Nothird party beneficiaries are intended in connection with this Amendment.

 

5.07.        This Amendment, togetherwith the Credit Agreement, contains the entire and exclusive agreement of theparties hereto with reference to the matters discussed herein and therein.  This Amendment supercedes all prior draftsand communications with respect hereto. This Amendment may not be amended except in accordance with theprovisions of Section 10.1 of the Credit Agreement.

 

[Signature Page Follows]

 

6

----

 

IN WITNESS WHEREOF, each parties hereto have causedthis Agreement to be duly executed as of the date first above written.

 
|   | METHODE  ELECTRONICS, INC.                          |
|--------|-----------------------------------------------------|
|   |                                                |
|   |                                                |   |
|   | By:                                                 | /s/  Douglas A. Koman |
|   | Name:                                               | Douglas  A. Koman |
|   | Title:                                              | Vice  President |
|   |                                                |   |
|   |                                                |   |
|   | BANK  OF AMERICA, N.A., as Administrative Agent     |
|   |                                                |   |
|   |                                                |   |
|   | By:                                                 | /s/  Jonathan M. Phillips |
|   | Name:                                               | Jonathan  M. Phillips |
|   | Title:                                              | Senior  Vice President |
|   |                                                |   |
|   |                                                |   |
|   | BANK  OF AMERICA, N.A., as a Lender, and L/C Issuer |
|   |                                                |   |
|   |                                                |   |
|   | By:                                                 | /s/  Jonathan M. Phillips |
|   | Name:                                               | Jonathan  M. Phillips |
|   | Title:                                              | Senior Vice President |

 

----