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Exhibit 10.29
The Provident Bank
COMMERCIAL BANKING GROUP
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216/▇▇▇-▇▇▇▇
Fax 216/▇▇▇-▇▇▇▇
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Vice President
March 18, 1998
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Senior Vice President and Chief Financial Officer
Universal Electronics Inc.
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Dear ▇▇▇▇:
I am pleased to inform you that The Provident Bank ("Bank") has agreed to extend
the Credit Agreement dated November 21, 1995, as amended, between Bank and
Universal Electronics Inc. ("Borrower") until April 30, 2000, without a
prepayment penalty or unused fee beyond the date of termination' and waive the
Company's Tangible Net Worth (Section 5.15(a)) and Interest Coverage (Section
5.15(b)) requirements as of and for the period ended December 31, 1997. These
waivers and our approval of amended and/or new covenants for fiscal year 1998
are subject to Borrower's approval of the following new terms and conditions:
Pursuant to your request, we have reduced the Revolver from $22 million
to $15 million. The Revolver is to be priced at Prime + 1/4% and will
contain an incentive pricing feature (see attachment) which will go
into effect after June 30, 1998. The performance based pricing, as in
prior instances, is subject to compliance with all financial and other
covenants.
The Borrower's Consolidated Tangible Net Worth covenant shall be
amended to an amount of not less than $37,000,000 (less the aggregate
amount expended by Borrower to repurchase up to one million shares of
its capital stock as previously allowed), which minimum shall increase
by 75% of net income, if positive, on December 31, 1998, and on
December 31st of each year thereafter.
The Borrower's Interest Coverage ratio is to remain at 2.0 to 1.0.
However, the next test of this covenant will not be until December 31,
1998.
A Debt to Tangible Net Worth ratio of not more than 1.25 to 1.0 shall
be established and tested monthly.
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All documentation shall be in form and content satisfactory to
Provident and its legal counsel in their sole discretion. The Borrower
agrees to a $20,000 waiver/ documentation fee and will reimburse the
Bank for expenses incurred in connection with the amendment of existing
loan documents. The Bank will directly charge your account for these
expenses.
If you are in agreement with the terms and conditions set forth above, please
indicate your acceptance by signing this letter and returning it to me by fax
and mailing the original no later than March 31, 1998. My fax number is (216)
694-2323.
Sincerely,
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ACCEPTED;
UNIVERSAL ELECTRONICS INC.
By:
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Its:
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Date:
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Enclosure
cc: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇.
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UNIVERSAL ELECTRONICS, INC.
PRICING MATRIX
Present Loan Pricing Structure
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Original Rate Prime - 1/2%
Current Rate Prime + 1/4%
Int. Coverage greater than 2.0 to 1.0 and up to 3.0 to 1.0 Prime - 1/2%
Int. Coverage greater than 3.0 to 1.0 Prime - 3/4%
Note: incentive pricing to go into effect after the receipt of audited 1998
financial statements. Predicated upon customer compliance with all covenants.
New Loan Pricing Structure Prime LIBOR
-------------------------- Option Option
------ ------
Current Rate
Int. Coverage greater than 2.0 to 1.0 and up to 3.0 to 1.0 Prime + 1/4%
Int. Coverage greater than 3.0 to 1.0 Prime - 1/2% L + 225
Prime - 3/4% L + 200
Note: performance based pricing available after 8/30/98 and based upon four
quarter rolling financial results less one time 1997 charge for discontinuation
of U.S. retail operations. Predicated upon customer compliance with all
covenants.