QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).¨YesxNo

The number of Common Shares, without par value, outstanding as of April ~~30, 2015~~29, 2016 was ~~28,017,385.~~27,837,392.

Portions of this report contain “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. These statements appear in a number of places in this report and include statements regarding the intent, belief or current expectations of the Company, our directors or officers with respect to, among other things, our (i) future product and facility expansion, (ii) acquisition or divestiture strategy, (iii) investments and new product development, and (iv) growth opportunities related to awarded business. Forward-looking statements may be identified by the words “will,” “may,” “should,” “designed to,” “believes,” “plans,” “projects,” “intends,” “expects,” “estimates,” “anticipates,” “continue,” and similar words and expressions. The forward-looking statements in this report are subject to risks and uncertainties that could cause actual events or results to differ materially from those expressed in or implied by the statements. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, among other factors:

In addition, the forward-looking statements contained herein represent our estimates only as of the date of this filing and should not be relied upon as representing our estimates as of any subsequent date. While we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so, whether to reflect actual results, changes in assumptions, changes in other factors affecting such forward-looking statements or otherwise.

The accompanying notes are an integral part of these condensed consolidated financial statements.

The Company has combined comprehensive income (loss) from continuing operations and comprehensive ~~income (loss)~~loss from discontinued operations herein.

The accompanying notes are an integral part of these condensed consolidated financial statements.

The Company has combined cash flows from continuing operations and cash flows from discontinued operations within the operating, investing and financing categories.

The accompanying notes are an integral part of these condensed consolidated financial statements.

The accompanying condensed consolidated financial statements have been prepared by Stoneridge, Inc. (the “Company”) without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). The information furnished in the condensed consolidated financial statements includes normal recurring adjustments and reflects all adjustments, which are, in the opinion of management, necessary for a fair presentation of such financial statements. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. generally accepted accounting principles have been condensed or omitted pursuant to the SEC's rules and regulations. The results of operations for the three months ended March 31, ~~2015~~2016 are not necessarily indicative of the results to be expected for the full year.

While the Company believes that the disclosures are adequate to make the information presented not misleading, it is suggested that these condensed consolidated financial statements be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company's ~~2014~~2015 Form 10-K.

The Company entered into an asset purchase agreement to divest its Wiring business including substantially all of its assets and liabilities during the second quarter of 2014. The sale was completed on August 1, 2014. The Wiring business has been classified as discontinued operations for all periods presented in the condensed consolidated financial statements. Accordingly, the Wiring business is excluded from both continuing operations and segment results for all periods presented. All previously reported financial information has been revised to conform to the current presentation. The Wiring business designed and manufactured wiring harness products and assembled instruments panels for sale principally to the commercial, agricultural and off-highway vehicle markets.

In ~~April 2015,~~March 2016, the F~~inancial~~Financial Accounting Standards Board (“FASB”)issued ~~accounting standards update~~Accounting Standards Update (“ASU”) 2016-09, “Compensation - Stock Compensation (Topic 718)” which is intended to simplify several aspects of the accounting for share-based payment award transactions including how excess tax benefits should be classified in the Company’s condensed consolidated financial statements. The new standard also permits companies to recognize forfeitures as they occur as an alternative to utilizing estimated forfeitures rates which has been the required practice. The new accounting standard will be effective for fiscal years beginning after December 15, 2016, including interim periods within that year. The Company is currently evaluating the impact of adopting this standard in its condensed consolidated financial statements.

In February 2016, the FASB issued ASU 2016 – 02, “Leases (Topic 842)” which will require that a lessee recognize assets and liabilities on the balance sheet for all leases with a lease term of more than twelve months, with the result being the recognition of a right of use asset and a lease liability. The amendment is effective for fiscal years beginning after December 15, 2018, including interim periods within that year. The Company expects to adopt this standard as of January 1, 2019. The Company is currently evaluating the impact of adopting this standard on its condensed consolidated financial statements, which will require right of use assets and lease liabilities be recorded in the condensed consolidated balance sheet for operating leases.

In November 2015, the FASB issued ASU 2015 – ~~03, “Simplifying the Presentation of Debt Issuance Costs,~~17, “Income Taxes (Topic 740)” which ~~amends~~simplifies the ~~current~~ presentation of ~~debt issuance costs in the financial statements. ASU 2015-03 requires that debt issuance costs related~~deferred income taxes. Currently entities are required to ~~a recognized debt liability be presented~~separate deferred income tax liabilities and assets into current and noncurrent amounts in the balance ~~sheet~~sheet. ASU 2015-17 requires that all deferred income taxes be classified as ~~a direct deduction from~~noncurrent in the ~~carrying amount of that debt liability, consistent with debt discounts, instead of as an asset.~~balance sheet. The amendment is ~~to be applied retrospectively and is~~ effective ~~for public companies~~ for fiscal years ~~and for~~beginning after December 15, 2016 including interim periods within those fiscal years ~~beginning after December 15, 2015,~~and may be applied either prospectively or retrospectively with early adoption permitted. AsThe Company is currently evaluating the ~~Company currently presents deferred financing costs within long-term assets,~~impact of adopting this standard on its condensed consolidated financial statements.

In July 2015, the ~~adoption~~FASB issued ASU 2015-11 “Simplifying the Measurement of Inventory” which requires that inventory be measured at the lower of cost or net realizable value. Prior to the issuance of the new guidance, ~~will result in~~inventory was measured at the ~~reclassification~~lower of ~~debt issuance costs into long-term debt in the Company’s condensed consolidated balance sheets.~~

~~In January 2015, theFASB~~ ~~issued ASU 2015 – 01 “Income Statement – Extraordinary and Unusual Items,” that eliminates~~cost or market. Replacing the concept of ~~extraordinary items~~market with the single measurement of net realizable value is intended to reduce cost and ~~their segregation from the results of ordinary operations and expands presentation and disclosure guidance to include items that are both unusual in nature and occur infrequently.~~complexity. The new accounting standard is effective for fiscal years beginning after December 15, ~~2015.~~2016. The Company ~~will~~expects to adopt this standard as of January 1, ~~2016~~2017, which is not expected to have a material impact on the Company’s condensed consolidated financial statements or disclosures.

In June 2014, the FASB issued ASU 2014 – 12 “Stock Compensation - Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period,” that requires performance targets that could be achieved after the requisite service period be treated as performance conditions that affect the vesting of the award. The new accounting standard is effective for fiscal years beginning after December 15, 2015. The Company will adopt this standard as of January 1, 2016 which is not expected to have an impact on its condensed consolidated financial statements or financial statement disclosures.

In May 2014, the FASB issued ASU 2014-09 “Revenue from Contracts with ~~Customers,”~~Customers” which is the new comprehensive revenue recognition standard that will supersede existing revenue recognition guidance under U.S. GAAP. The standard's core principle is that a company will recognize revenue when it transfers promised goods or services to a customer in an amount that reflects the consideration to which the company expects to be entitled in exchange for those goods or services.To achieve this principle, an entity identifies the contract with a customer, identifies the separate performance obligations in the contract, determines the transaction price, allocates the transaction price to the separate performance obligations and recognizes revenue when each separate performance obligation is satisfied.This ASU allows for both retrospective and prospective methods of ~~adoption and is currently effective for annual and interim periods beginning on or after December 15, 2016, with early adoption not permitted.~~adoption. In ~~April~~July 2015, the FASB ~~proposed~~approved a one-year deferral of the effective date of the standard. ~~If approved,~~As such, the new standard will become effective for annual and interim periods beginning after December 15, 2017 with early adoption on the original effective date permitted.The Company is currently evaluating the impact of adopting this standard on its condensed consolidated financial statements.

In ~~April 2014,~~September 2015, the FASB issued ASU ~~No. 2014-08 “Presentation~~2015 – 16, “Business Combinations” which simplifies the accounting for measurement-period adjustments related to business combinations. ASU 2015-16 requires that an acquirer recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The amendments in the ASU require that the acquirer record, in the same period’s financial statements, the effect on earnings of ~~Financial Statements and Property, Plant, and Equipment,” which amends~~changes in depreciation, amortization, or other income effects, if any, as a result of the ~~definition of a discontinued operation in ASC 205-20 and requires entities~~change to ~~provide additional disclosures about discontinued operations~~the provisional amounts, calculated as ~~well as disposal transactions that do not meet~~if the ~~discontinued-operations criteria.~~accounting had been completed at the acquisition date. The ~~new standard changes the definition of a discontinued operation and requires discontinued operations treatment~~amendment is effective for disposals of a component or group of components that represents a strategic shift that has or will have a major impact on an entity’s operations or financial results. This ASU was effective prospectively for all disposals (except disposals classified as held for sale before the adoption date) or components initially classified as held for sale in periodsfiscal years beginning ~~on or~~ after December 15, ~~2014. Early adoption was permitted.~~2015, including interim periods within those fiscal years and is to be applied prospectively to adjustments to provisional amounts that occur after the effective date of this ASU with earlier application permitted for financial statements that have not been issued. The Company adopted this standard as of January 1, 2016, which did not have an impact on the Company’s condensed consolidated financial statements or disclosures.

In April 2015, the FASB issued ASU 2015-03, “Simplifying the Presentation of Debt Issuance Costs” which amends the current presentation of certain debt issuance costs in ~~May 2014~~the balance sheet. ASU 2015-03 requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts, instead of as an asset. The recognition and measurement of debt issuance costs are not affected by the amendments in this ASU. The guidance in ASU 2015-03 did not address the presentation or subsequent measurement of debt issuance costs related to line of credit arrangements. Given the absence of authoritative guidance, in June 2015 the FASB issued ASU 2015-15, “Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements,” which states that the SEC will not object to an entity deferring and presenting debt issuance costs related to revolving credit arrangements as an asset and subsequently amortizing them. These amendments are to be applied ~~it prospectively~~retrospectively and are effective for public companies for fiscal years, and for interim periods within those fiscal years, beginning after December 15, 2015, with early adoption permitted. As permitted by the ASU, the Company adopted these standards in the third quarter of 2015, which had no impact on the Company’s consolidated financial statements. The Company elected to ~~new disposals and new classifications of disposal groups~~continue to present deferred financing costs related to its revolving credit facility within long-term assets in the Company’s condensed consolidated balance sheets as ~~held for sale including~~permitted under the ~~Wiring business.~~standard.

On May 26, 2014, the Company entered into an asset purchase agreement to sell substantially all of the assets and liabilities of the former Wiring segment to Motherson Sumi Systems Ltd., an India-based manufacturer of diversified products for the global automotive industry and a limited company incorporated under the laws of the Republic of India, and MSSL (GB) LIMITED, a limited company incorporated under the laws of the United Kingdom (collectively, “Motherson”), for$65,700 in cash and the assumption of certain related liabilities of the Wiring business.

On August 1, 2014, the Company completed the sale of substantially all of the assets and liabilities of its Wiring business to Motherson for $71,386 in cash that consisted of the stated purchase price and estimated working capital on the closing date. The final purchase price iswas subject to post-closing working capital and other ~~adjustments, which impacts~~adjustments. Upon the ~~loss on disposal recorded in discontinued operations. The disputed items regarding~~final resolution of the working capital and other adjustments that have not been amicably resolved between the Company and Motherson are being determined by an independent accountant in accordance with the asset purchase agreement, the resolution of which is expected to occur in the second quarter of ~~2015.~~2015, the Company returned $1,230 in cash to Motherson.

The Company also entered into short-term transition services agreements with Motherson ~~expected to conclude~~substantially all of which concluded in the second quarter of 2015 associated with information systems, accounting, administrative, occupancy and support services as well as contract manufacturing and production support in Estonia.

The Company had post-disposition sales to the Wiring business acquired by Motherson ~~of $7,228~~ for the three months ended March 31, ~~2015. Post-disposition~~2016 and 2015 of $5,686 and $7,228 respectively. The Company had post-disposition purchases ~~by the Company~~ from the Wiring business acquired by Motherson ~~were~~of $108 and $168 for the three months ended March 31, ~~2015.~~2016 and 2015, respectively.

(There was no activity related to discontinued operations for the Wiring business in ~~thousands, except per share data, unless otherwise indicated)~~

~~(Unaudited)~~the condensed consolidated statements of operations for the three months ended March 31, 2016.

The following ~~tables display~~table displays summarized activity in ~~our~~the condensed consolidated statements of operations for discontinued operations related to the Wiring ~~business.~~business:

~~Intercompany sales to the Wiring business were $7,780 for the three months ended March 31, 2014. Intercompany purchases from the Wiring business were $1,875 for the three months ended March 31, 2014.~~

Inventories are valued at the lower of cost (using either the first-in, first-out (“FIFO”) or average cost methods) or market. The Company evaluates and adjusts as necessary its excess and obsolescence reserve ~~at a minimum~~ on a quarterly basis. Excess inventories are quantities of items that exceed anticipated sales or usage for a reasonable period. The Company has guidelines for calculating provisions for excess inventories based on the number of months of inventories on hand compared to anticipated sales or usage. Management uses its judgment to forecast sales or usage and to determine what constitutes a reasonable period. Inventory cost includes material, labor and overhead. Inventories consisted of the following:

Inventory valued using the FIFO method was $43,639 and $35,378 at March 31, 2016 and December 31, 2015, respectively. Inventory valued using the average cost method was $25,728 and $25,631 at March 31, 2016 and December 31, 2015, respectively.

Inventory valued using the FIFO method was $37,925 and $34,636 at March 31, 2015 and December 31, 2014, respectively. Inventory valued using the average cost method was $34,017 and $36,617 at March 31, 2015 and December 31, 2014, respectively.

A financial instrument is cash or a contract that imposes an obligation to deliver, or conveys a right to receive cash or another financial instrument. The carrying values of cash and cash equivalents, accounts receivable and accounts payable are considered to be representative of fair value because of the short maturity of these instruments.

On March 31, ~~2015,~~2016, the Company had open foreign currency forward contracts which are used solely for hedging and not for speculative purposes. Management believes that its use of these instruments to reduce risk is in the Company's best interest. The counterparties to these financial instruments are financial institutions with investment grade credit ratings.

The Company conducts business internationally and therefore is exposed to foreign currency exchange rate risk. The Company uses derivative financial instruments as cash flow and fair value hedges to manage its exposure to fluctuations in foreign currency exchange rates by reducing the effect of such fluctuations on foreign currency denominated intercompany transactions, inventory purchases and other foreign currency exposures. The currencies hedged by the Company during 2016 and 2015 included the euro and ~~2014 include~~Mexican peso. In addition, the Company hedged the U.S. dollar against the Swedish krona and euro on behalf of its European subsidiaries in 2016 and ~~Mexican peso.~~2015.

These forward contracts were executed to hedge forecasted transactions and ~~were~~have been accounted for as cash flow hedges. As such, the effective portion of the unrealized gain or loss was deferred and reported in the Company’s condensed consolidated balance sheets as a component of accumulated other comprehensive loss. The cash flow hedges were highly effective. The effectiveness of the transactions has been and will be measured on an ongoing basis using regression analysis and forecasted future purchases of the ~~U.S. dollar and Mexican peso.~~currency.

In certain instances, the foreign currency forward contracts do not qualify for hedge accounting or are not designated as hedges, and therefore are marked-to-market with gains and losses recognized in the Company's condensed consolidated statement of operations as a component of other (income) expense, net.

The Company's foreign currency forward contracts offset a portion of the gains and losses on the underlying foreign currency denominated transactions as follows:

~~As of~~At March 31, ~~2015~~2016 and December 31, ~~2014,~~2015, the Company held a foreign currency forward contract with underlying notional amounts of ~~$1,631~~$1,730 and ~~$3,523,~~$1,647, respectively, to reduce the exposure related to the Company's euro-denominated intercompany loans. This contract expires in June ~~2015.~~2016. The euro-denominated foreign currency forward contract was not designated as a hedging instrument. The Company recognized a loss of $82 and a gain of $388 ~~and a loss of $61~~ for the three months ended March 31, ~~2015~~2016 and ~~2014,~~2015, respectively, in the condensed consolidated statements of operations as a component of other (income) expense, net related to the euro-denominated ~~contracts.~~

U.S. dollar-denominated Foreign Currency Forward Contracts – Cash Flow ~~Hedge~~Hedges

The Company entered into on behalf of one of its European Electronics subsidiaries whose functional currency is the euro, U.S. dollar-denominated currency contracts with a notional amount at March 31, 2015 of $3,205 which expire ratably on a monthly basis from April 2015 through December 2015, compared to $4,266 at December 31, 2014.

The Company entered into on behalf of one of its European Electronics subsidiaries whose functional currency is the Swedish krona, U.S. dollar-denominated currency contracts with a notional amount at March 31, ~~2015~~2016 of ~~$8,801~~$7,621 which expire ratably on a monthly basis from April ~~2015~~2016 through December ~~2015,~~2016, compared to ~~$11,718~~a notional amount of $10,007 at December 31, ~~2014.~~2015.

The Company entered into on behalf of one of its European Electronics subsidiaries whose functional currency is the euro, U.S. dollar-denominated currency contracts with a notional amount at March 31, 2016 of $1,802 which expire ratably on a monthly basis from April 2016 through December 2016, compared to a notional amount of $2,421 at December 31, 2015.

The Company evaluated the effectiveness of the U.S. dollar-denominated foreign currency forward contracts held as of March 31, 2016 and December 31, 2015 and concluded that the hedges were effective.

Mexican peso-denominated Foreign Currency Forward Contracts – Cash Flow Hedge

The Company holds Mexican peso-denominated foreign currency forward contracts with notional amounts at March 31, ~~2015~~2016 of ~~$7,790~~$7,237 which expire ratably on a monthly basis from April ~~2015~~2016 through December ~~2015,~~2016, compared to ~~$10,282~~a notional amount of $9,780 at December 31, ~~2014.~~

To mitigate the risk of future price volatility and, consequently, fluctuations in gross margins, the Company entered into fixed price commodity contracts with a financial institution to fix the cost of a portion of the Company’s copper purchases. Copper is a raw material used in many of the Company’s products.2015.

The Company ~~did not have any fixed price commodity~~evaluated the effectiveness of the Mexican peso-denominated foreign currency forward contracts atheld as of March 31, ~~2015 compared to an aggregate notional amount of 317 pounds at~~2016 and December 31, ~~2014.~~

~~The unrealized gain or loss for the effective portion of~~2015 and concluded that the hedges were deferred and reported in the Company’s condensed consolidated balance sheets as a component of accumulated other comprehensive loss while the ineffective portion, if any, was reported in the condensed consolidated statements of operations. The effectiveness of the transactions is measured on an ongoing basis using regression analysis and forecasted future copper purchases. Based upon the results of the regression analysis, the Company has concluded that these cash flow hedges were highly effective.

The Company had a fixed-to-floating interest rate swap agreement (the “Swap”) with a notional amount of $45,000 to hedge its exposure to fair value fluctuations on a portion of its senior notes. The Swap was designated as a fair value hedge of the fixed interest rate obligation under the Company's $175,000 9.5% senior notes due October 15, 2017. Under the Swap, the Company paid a variable interest rate equal to the six-month London Interbank Offered Rate (“LIBOR”) plus 7.2% and it received a fixed interest rate of 9.5%. The difference between amounts received and paid under the Swap was recognized as a component of interest expense, net on the condensed consolidated statements of operations.

In connection with the Company’s notice of redemption issued on September 15, 2014 to redeem all remaining outstanding senior notes, the interest rate fair value hedge was de-designated on that date. On October 23, 2014, the Company terminated the interest rate swap.

~~The Swap reduced interest expense by $225 for the three months ended March 31, 2014.~~

The notional amounts and fair values of derivative instruments in the condensed consolidated balance sheets were as follows:

Amounts recorded for the cash flow hedges in other comprehensive ~~income (loss)~~loss and in net income for the three months ended March 31 are as follows:

Gains and losses reclassified from other comprehensive income (loss) into net income were recognized in cost of goods sold in the Company's condensed consolidated statements of operations.

The net deferred ~~gain~~loss of ~~$936~~$60 on the cash flow hedge derivatives will be reclassified from other comprehensive income (loss) to the condensed consolidated statements of operations in 2015. The Company has measured the ineffectiveness of the forward currency and commodity contracts and any amounts recognized in the condensed consolidated financial statements were immaterial for the three months ended March 31, 2015 and 2014.through December 2016.

The following table presents ~~our~~the Company’s assets and liabilities that are measured at fair value on a recurring basis and are categorized using the three levels of the fair value hierarchy based on the reliability of the inputs used.

Compensation expense for share-based compensation arrangements, which is recognized in the condensed consolidated statements of operations as a component of selling, general and administrative expenses, was $960 for the three months ended March 31, 2016 compared to $3,325 ~~including~~for the three months ended March 31, 2015 which included $2,225 from the accelerated vesting in connection with the retirement of ~~its~~the Company’s former President and Chief Executive ~~Officer, and $1,163 for the three months ended March 31, 2015 and 2014, respectively.~~ Officer.

Debt consisted of the following at March 31, ~~2015~~2016 and December 31, ~~2014:~~2015:

On November 2, 2007, the Company entered into an asset-based credit facility, which permits borrowing up to a maximum level of $100,000. The Company entered into an Amended and Restated Credit and Security Agreement and a Second Amended and Restated Credit and Security Agreement on September 20, 2010 and December 1, 2011, respectively.

On September 12, 2014, the Company entered into a Third Amended and Restated Credit Agreement (the “Amended Agreement” or “Credit Facility”). The Amended Agreement provides for a $300,000 revolving credit facility, which ~~replaces~~replaced the Company’s existing $100,000 asset-based credit facility and includes a letter of credit subfacility, swing line subfacility and multicurrency subfacility. The ~~amended revolving credit facility (the “Credit Facility”)~~Amended Agreement also has an accordion feature which allows the Company to increase the availability by up to $80,000 upon the satisfaction of certain conditions.The Amended Agreement ~~extends~~extended the termination date ~~of the Company’s Credit Facility~~ to September 12, 2019 from December 1, 2016. On March 26, 2015, the Company entered into Amendment No. 1 (the “Amendment”) to the Amended Agreement which modified the definition of Consolidated EBITDA to allow for the add back of cash premiums and other non-cash charges related to the amendment and restatement of the Amended Agreement and the early extinguishment of the Company’s 9.5% Senior Secured ~~Notes totaling $10,507 both of which occurred in second half of 2014.~~Notes. Consolidated EBITDA is used in computing the Company’s leverage ratio and interest coverage ratio which are covenants within the Amended Agreement. On February 23, 2016, the Company entered into Amendment No. 2 to the Amended Agreement which amended and waived any default or potential defaults with respect to the pledging as collateral additional shares issued by a wholly owned subsidiary and newly issued shares associated with the formation of a new subsidiary.

Borrowings under the Amended Agreement will bear interest at either the Base Rate, as defined, or the LIBOR Rate, at the Company’s option, plus the applicable margin as set forth in the Amended Agreement. The Company is also subject to a commitment fee ranging from 0.20% to 0.35% based on the Company’s leverage ratio. The agreement governing ~~our~~the Credit Facility requires the Company to maintain a maximum leverage ratio of 3.00 to 1.00, and a minimum interest coverage ratio of 3.50 to 1.00 and places a maximum annual limit on capital expenditures. The Amended Agreement also contains other affirmative and negative covenants and events of default that are customary for credit arrangements of this type including covenants which place restrictions and/or limitations on the Company’s ability to borrow money, make capital expenditures and pay dividends. Borrowings outstanding on the Credit Facility at both March 31, 2016 and December 31, 2015 were $100,000.

The Company was in compliance with all credit facility covenants at March 31, ~~2015~~2016 and December 31, ~~2014.~~2015.

On October 4, 2010, the Company issued $175,000 of senior secured notes which bore interest at an annual rate of 9.5% and were scheduled to mature on October 15, 2017. On September 2, 2014, the Company redeemed $17,500, or 10.0%, of its senior secured notes at a price of 103.0% of the principal amount. On October 15, 2014, the Company redeemed the remaining $157,500 of its senior secured notes at a price of 104.75% of the principal amount discharging the corresponding senior notes indenture.

As a result of the redemption, the Company recognized a loss on extinguishment of debt of $10,507 in the second half of 2014, which included a premium of $8,006 and the acceleration of the remaining deferred financing costs of $597, original issue discount of $2,252 and de-designation date unrecognized gain on the interest rate swap of $348.

PST maintains several short-term obligations and long-term notes used for working capital ~~purposes. The PST notes mature on July 15, 2017 and November 15, 2021 with interest payable quarterly at a~~purposes which have fixed annual ~~interest rate of 8.0% and 4.0%, respectively. PST’s other short-term obligations and long-term notes also have fixed~~ interest rates. The weighted-average interest rates of short-term and long-term debt of PST at March 31, ~~2015~~2016 were ~~13.4%~~16.0% and ~~5.5%~~7.3%, respectively. Depending on the specific note, interest is payable either monthly or annually. ~~The~~Principal payments on PST debt at March 31, ~~2015 matures~~2016 are as follows: ~~$13,863~~$16,503 from April 2016 through March 2017, $1,400 from April 2017 through December 2017, $1,082 in ~~2015, $2,252~~2018, $1,058 in ~~2016, $2,099 in 2017, $1,174 in both 2018 and~~ 2019, ~~$403~~$363 in 2020 and ~~$369~~$303 in 2021.

On February 25, 2014, the Company's wholly-owned subsidiary located in Suzhou, China entered into a term loan for 9,000 Chinese yuan (the “Suzhou note”) which matured in August 2014. On October 17, 2014, the subsidiary entered into a new term loan for 9,000 Chinese yuan (the "Suzhou note") which matured in April 2015. The U.S. dollar equivalent outstanding loan balance was $1,452 and $1,450 at March 31, 2014 and December 31, 2014, respectively, under these term loan agreements. The Suzhou note is included on the condensed consolidated balance sheets as a component of current portion of long-term debt. Interest is payable quarterly at 120.0% of the one-year lending rate published by The People's Bank of China.

The Company was in compliance with all ~~note~~debt covenants at March 31, ~~2015~~2016 and December 31, ~~2014.~~2015.

The Company's wholly-owned subsidiary located in Stockholm, Sweden, has an overdraft credit line which allows overdrafts on the subsidiary's bank account up to a maximum level of 20,000 Swedish krona, or ~~$2,317~~$2,464 and ~~$2,562,~~$2,369, at March 31, ~~2015~~2016 and December 31, ~~2014,~~2015, respectively. At March 31, ~~2015~~2016 and December 31, ~~2014,~~2015, there was no balance outstanding on this bank account.

Basic earnings (loss) per share was computed by dividing net income (loss) by the weighted-average number of Common Shares outstanding for each respective period. Diluted earnings (loss) per share was calculated by dividing net income (loss) by the weighted-average of all potentially dilutive Common Shares that were outstanding during the periods presented.

Weighted-average Common Shares outstanding used in calculating basic and diluted earnings (loss) per share were as follows:

~~There were 234,450 and 466,650 performance-based~~Performance-based restricted Common Shares outstanding at March 31, 2016 and March 31, 2015 were 0 and ~~2014,~~234,450, respectively. There were also ~~710,235~~803,100 and ~~374,400~~710,235 performance-based right to receive Common Shares outstanding at March 31, ~~2015~~2016 and ~~2014,~~2015, respectively. These performance-based restricted and right to receive Common Shares are included in the computation of diluted earnings per share based on the number of Common Shares that would be issuable if the end of the quarter were the end of the contingency period.

Changes in accumulated other comprehensive loss for the three months ended March 31, 2016 and 2015 were as follows:

In the ordinary course of business, the Company is subject to a broad range of claims and legal proceedings that relate to contractual allegations, product liability, tax audits, patent infringement, ~~product liability,~~ employment-related matters and environmental matters. The Company establishes accruals for matters which it believes that losses are probable and can be reasonably estimable. Although it is not possible to predict with certainty the outcome of these matters, the Company is of the opinion that the ultimate resolution of these matters will not have a material adverse effect on its consolidated results of operations or financial position.

As a result of environmental studies performed at the Company’s former facility located in Sarasota, Florida, the Company became aware of soil and groundwater contamination at the site. The Company engaged an environmental engineering consultant to assess the level of contamination and to develop a remediation and monitoring plan for the site. Soil remediation at the site was completed during the year ended December 31, 2010. ~~Ground water remediation will begin in the second quarter of 2015, as~~As the remedial action plan has been approved by the Florida Department of Environmental ~~Protection.~~Protection, groundwater remediation began in the fourth quarter of 2015. During the three months ended March ~~31,~~1, 2016 and 2015, ~~and 2014,~~ environmental remediation costs incurred were immaterial. At March 31, ~~2015~~2016 and December 31, ~~2014,~~2015, the Company ~~had~~ accrued ana remaining undiscounted liability of ~~$865~~$505 and ~~$876,~~$532, respectively, related to future ~~remediation.~~remediation costs. At March 31, ~~2015~~2016 and December 31, ~~2014, $801~~2015, $441 and ~~$813,~~$469, respectively, was recorded as a component of accrued expenses and other current liabilities on the condensed consolidated balance sheets while the remaining amount was recorded as a component of other long-term liabilities. A majority of the costs associated with the recorded liability will be incurred at the start of the groundwater remediation, with the balance relating to monitoring costs to be incurred over multiple years. The recorded liability is based on assumptions in the remedial action plan. Although the Company sold the Sarasota facility and related property in December 2011, the liability to remediate the site contamination remains the responsibility of the Company. Due to the ongoing site remediation, the closing terms of the sale agreement included a requirement for the Company to maintain a $2,000 letter of credit for the benefit of the buyer.

The Company has a legal proceeding,Verde v. Stoneridge, Inc. et al., currently pending in the United States District Court for the Eastern District of Texas, Cause No. 6:14-cv-00225- KNM. The plaintiff filed this putative class action against the Company and others on March 26, 2014. The plaintiff alleges that the Company was involved in the vertical chain of manufacture, distribution, and sale of a control device (“CD”) that was incorporated into a Dodge Ram truck purchased by Plaintiff in 2006. Plaintiff alleges that the Company breached express warranties and indemnification provisions by supplying a defective CD that was not capable of performing its intended function. The putative class consists of all Texas residents who own manual transmission Chrysler vehicles model years 1994–2007 equipped with the subject CD. Plaintiff seeks recovery of economic loss damages incurred by him and the putative class members associated with inspecting and replacing the allegedly defective CD, as well as attorneys’ fees and costs. Plaintiff filed his motion for class certification seeking to certify a class of Texas residents who own or lease certain automobiles sold by Chrysler from 1998–2007. Plaintiff alleges this putative class would include approximately 120,000 people. In the motion for class certification, the Plaintiff states that damages are no more than $1 per person. A hearing on the Plaintiff’s motion for class certification was held on November 16, 2015, and the United States District Court has not yet ruled on class certification. On April 8, 2016, the Magistrate Judge granted the Company’s motion for partial summary judgment dismissing the Plaintiff’s indemnification claim; the United States District Court has not yet ruled on whether to adopt the Magistrate Judge’s ruling. Similarly,Royal v. Stoneridge, Inc. et al. is another legal proceeding currently pending in the United States District Court for the Western District of Oklahoma, Cause No. 5:14-cv-01410-F. Plaintiffs filed this putative class action against the Company, Stoneridge Control Devices, Inc., and others on December 19, 2014. Plaintiffs allege that the Company was involved in the vertical chain of manufacture, distribution, and sale of a CD that was incorporated into Dodge Ram trucks purchased by Plaintiffs between 1999 and 2006. Plaintiffs allege that the Company and Stoneridge Control Devices, Inc. breached various express and implied warranties, including the implied warranty of merchantability. Plaintiffs also seek indemnity from the Company and Stoneridge Control Devices, Inc. The putative class consists of all owners of vehicles equipped with the subject CD, which includes various Dodge Ram trucks and other manual transmission vehicles manufactured from 1997–2007, which Plaintiffs allege is more than one million vehicles. Plaintiffs seek recovery of economic loss damages associated with inspecting and replacing the allegedly defective CD, diminished value of the subject CDs and the trucks in which they were installed, and attorneys’ fees and costs. The amount of compensatory or other damages sought by Plaintiffs and the putative class members is unknown. On January 12, 2016, the United States District Court granted in part the Company’s and Stoneridge Control Devices, Inc.’s motions for summary judgment, and dismissed four of the Plaintiffs’ five claims against the Company and Stoneridge Control Devices, Inc. Plaintiffs have filed a motion for reconsideration of the United States District Court’s ruling, which remains pending. The Company is vigorously defending itself against the Plaintiffs’ allegations, and has and will continue to challenge the claims as well as class action certification. The Company believes the likelihood of loss is not probable or reasonably estimable, and therefore no liability has been recorded for these claims at March 31, 2016.

In September 2013, atwo legal ~~proceeding was~~proceedings were initiated by Actia Automotive (“Actia”) in a French court (the tribunal de grande instance de Paris) alleging infringement of its patents by the Company’s Electronics segment. The euro (“€”) and U.S. dollar equivalent (“$”) that Actia is seeking ~~is €14,000~~has been €7,000 ($~~15,000)~~8,000) for each claim for injunctive relief and monetary damages resulting from such alleged infringement. The Company believes that its products did not infringe on any of the patents claimed by Actia, and the ~~claim is~~claims are without merit. ~~Therefore it~~The Company is vigorously defending itself against these ~~allegations. The~~allegations, and it has challenged certain Actia patents in the European Patent Office. In September 2015, the French court ruled in favor of the Company ~~believes the likelihood of loss~~on one claim, which is ~~not probable. As such, no liability has been recorded for this claim.~~subject to appeal by Actia. There have been no significant changes to the facts and circumstances related to ~~this~~the remaining claim for the three months ended March 31, ~~2015.~~2016. The Company believes the likelihood of loss is not probable between its defenses and challenges to Actia’s patents. As such, no liability has been recorded for these claims at March 31, 2016.

On May 24, 2013, the State Revenue Services of São Paulo issued a tax deficiency notice against PST claiming that the vehicle tracking and monitoring services it provides should be classified as communication services, and therefore subject to the State Value Added Tax – ICMS. The State Revenue Services assessment imposed the 25.0% ICMS tax on all revenues of PST related to the vehicle tracking and monitoring services rendered during the period from January 2009 through December 2010. The Brazilian real (“R$”) and U.S. dollar equivalent (“$”) of the aggregate tax assessment is approximately R$92,500 ($~~28,800)~~26,000) which is comprised of Value Added Tax – ICMS of R$13,200 ($~~4,100)~~3,700), interest of R$11,400 ($~~3,600)~~3,200) and penalties of R$67,900 ($~~21,100)~~19,100).

The Company believes that the vehicle tracking and monitoring services are non-communication services, as defined under Brazilian tax law, subject to the municipal ISS tax, not communication services subject to state ICMS tax as claimed by the State Revenue Services of São Paulo. PST has, and will continue to collect the municipal ISS tax on the vehicle tracking and monitoring services in compliance with Brazilian tax law and will defend its tax position. PST has received a legal opinion that the merits of the case are favorable to PST, determining among other things that the imposition on the subsidiary of the State ICMS by the State Revenue Services of São Paulo is not in accordance with the Brazilian tax code. In April 2015, the Tribunal of Taxes and Imposts of the State of São Paulo ruled in favor of PST that its tracking and monitoring services are not subject to state ICMS tax. However, the written opinion of that tribunal has not yet been issued and is subject to appeal by the State Revenue Services of São Paulo to a higher court. Management believes, based on the legal opinion of the Company’s Brazilian legal counsel ~~the recent favorable legal ruling in favor of PST~~ and the results of the Brazil Administrative Court's ~~binding~~ ruling in favor of another vehicle tracking and monitoring company related to the tax deficiency notice it received, the likelihood of loss is not probable although it may take years to resolve. As a result of the above, as of March 31, ~~2015~~2016 and December 31, ~~2014,~~2015, no accrual has been recorded with respect to the tax assessment. An unfavorable judgment on this issue for the years assessed and for subsequent years could result in significant costs to PST and adversely affect its results of operations. There have been no significant changes to the facts and circumstances related to this notice for the three months ended March 31, 2016.

In addition, PST has civil, labor and other tax contingencies for which the likelihood of loss is deemed to be reasonably possible, but not probable, by the Company’s legal advisors in Brazil. As a result, no provision has been recorded with respect to these contingencies, which amounted to R$~~25,842~~26,700 ($~~8,100)~~7,500) and R$~~37,237~~25,400 ($~~14,000)~~6,500) at March 31, ~~2015~~2016 and December 31, ~~2014,~~2015, respectively. An unfavorable outcome on these contingencies could result in significant cost to PST and adversely affect its results of operations.

Amounts accrued for product warranty and recall claims are established based on the Company's best estimate of the amounts necessary to settle ~~future~~existing and ~~existing~~future claims on products sold as of the balance sheet dates. These accruals are based on several factors including past experience, production changes, industry developments and various other ~~considerations.~~considerations including insurance coverage. The Company can provide no assurances that it will not experience material claims ~~in the future~~ or that it will not incur significant costs to defend or settle such claims beyond the amounts accrued or beyond what the Company may recover from its suppliers. The current portion of product warranty and recall is included as a component of accrued expenses and other current liabilities onin the condensed consolidated balance sheets. Product warranty and recall included ~~$1,188~~$2,076 and ~~$1,204~~$1,973 of a long-term liability at March 31, ~~2015~~2016 and December 31, ~~2014,~~2015, respectively, which is included as a component of other long-term liabilities onin the condensed consolidated balance sheets.

The following provides a reconciliation of changes in product warranty and recall liability:

The Company regularly evaluates the performance of its businesses and cost structures, including personnel, and makes necessary changes thereto in order to optimize its results. The Company also evaluates the required skill sets of its personnel and periodically makes strategic changes. As a consequence of these actions, the Company incurs severance related costs which are referred to as business realignment charges.

~~The following provides a reconciliation of changes in product warranty and recall liability:~~ Business realignment charges by reportable segment were as follows:

~~(11)~~Business realignment charges classified by statement of operations line item were as follows:

There were no business realignment charges recorded for the three months ended March 31, 2015.

The Company computes its consolidated income tax provision each quarter based on a projected annual effective tax rate, as required. The Company is required to reduce deferred tax assets by a valuation allowance if, based on all available evidence, it is considered more likely than not that some portion or all of the benefit of the deferred tax assets will not be realized in future periods. The Company also records the income tax impact of certain discrete, unusual or infrequently occurring items including changes in judgment about valuation allowances and effects of changes in tax laws or rates, in the interim period in which they occur.

When a company maintains a valuation allowance in a particular jurisdiction, no net tax expense or (benefit) will typically be provided on ~~the~~ income (loss) for that ~~jurisdiction.~~jurisdiction on an annual basis. Jurisdictions with projected income that maintain a valuation allowance typically will form part of the projected annual effective tax rate calculation discussed above. However, jurisdictions with a projected loss for the year that maintain a valuation allowance are excluded from the projected annual effective income tax rate calculation. Instead, the income tax for these jurisdictions is computed separately.

The ~~Company also records the~~actual year to date income tax ~~impact~~expense (benefit) is the product of ~~certain~~the most current projected annual effective income tax rate and the actual year to date pre-tax income (loss) adjusted for any discrete ~~unusual or infrequently occurring items including changes in judgment about valuation allowances~~tax items. The income tax expense (benefit) for a particular quarter is the difference between the year to date calculation of income tax expense (benefit) and ~~effects of changes in tax laws or rates, in~~ the ~~interim period in which they occur.~~year to date calculation for the prior quarter.

Therefore, the actual effective income tax rate during a particular quarter can vary significantly based upon the jurisdictional mix and timing of actual earnings compared to projected annual earnings, permanent items, earnings for those jurisdictions that maintain a valuation allowance, tax associated with jurisdictions excluded from the projected annual effective income tax rate calculation and discrete items.

The Company recognized an income tax ~~provision~~expense of ~~$147~~$845 and ~~$295~~$147 from continuing operations for federal, state and foreign income taxes for the three months ended March 31, ~~2015~~2016 and ~~2014,~~2015, respectively. The ~~effective~~increase in tax ~~rate decreased from 171.5% in the first quarter of 2014 to 6.5% in the first quarter of 2015. The decrease in the tax provision and the effective tax rate~~expense for the three months ended March 31, ~~2015~~2016 compared to the same period for ~~2014~~2015 was primarily due to the ~~improved earnings of~~increase in consolidated earnings. In addition, tax expense increased due to the ~~U.S. operations and reduced earnings of the European operations, which was partially offset by the smaller~~PST operating loss ~~of PST. In addition, the Company recognized~~which generated a ~~discrete tax expense related to certain foreign operations during~~benefit for the first quarter of ~~2014 which did not recur~~2015, however, due to the valuation allowance position taken in the fourth quarter of 2015, no longer provides a tax benefit in 2016. The effective tax rate increased to 12.2% in the first quarter of ~~2015.~~2016 from 6.5% in the first quarter of 2015 primarily due to the PST loss which, due to a full valuation allowance, negatively impacts the effective tax rate. The impact of PST on the effective tax rate was partially offset by income from the U.S. operations which, due to a full valuation allowance, positively impacts the effective tax rate.

Operating segments are defined as components of an enterprise that are evaluated regularly by the Company's chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company's chief operating decision maker is the chief executive officer.

During the third quarter of 2014 the Company sold its Wiring business segment, which designed and manufactured wiring harness products and assembled instrument panels for sale principally to the commercial, agricultural and off-highway vehicle markets. As such, for all periods presented the Company reported this business as discontinued operations in the Company’s condensed consolidated financial statements and therefore excluded it from the segment disclosures herein. See Note 3 for additional details.

The Company has three reportable segments, Control Devices, Electronics and PST, which also represent its operating segments. The Control Devices reportable segment produces sensors, switches, valves and actuators. The Electronics reportable segment produces electronic instrument clusters, electronic control units and driver information systems. The PST reportable segment designs and manufactures electronic vehicle security alarms, convenience accessories, vehicle tracking devices and monitoring services and in-vehicle audio and video devices.

Also, during the second quarter of 2014 the Company changed its segment operating performance metric in accordance with changes in the financial information reviewed and performance measured by the Company’s chief operating decision maker. As a result, the Company now uses operating income for financial reporting purposes. Historically, the Company used income before income taxes. The Company has revised the consolidated segment information for all periods presented to reflect this presentation.

The accounting policies of the Company's reportable segments are the same as those described in Note 2, “Summary of Significant Accounting Policies” of the Company's ~~2014~~2015 Form 10-K. The Company's management evaluates the performance of its reportable segments based primarily on revenues from external customers ~~capital expenditures~~ and operating ~~income.~~income (loss). Inter-segment sales are accounted for on terms similar to those to third parties and are eliminated upon consolidation.

Three months ended March 31 2015 2014
Net Sales:
Control Devices $ 79,870 $ 77,324
Inter-segment sales 688 752
Control Devices net sales 80,558 78,076
Electronics 56,432 50,091
Inter-segment sales 4,966 11,757
Electronics net sales 61,398 61,848
PST 26,523 33,916
Inter-segment sales - -
PST net sales 26,523 33,916
Eliminations (5,654 ) (12,509 )
Total net sales $ 162,825 $ 161,331
Operating Income (Loss):
Control Devices $ 9,605 $ 8,433
Electronics 3,424 4,782
PST (2,650 ) (2,542 )
Unallocated Corporate^(A) (7,253 ) (4,239 )
Total operating income $ 3,126 $ 6,434
Depreciation and Amortization:
Control Devices $ 2,459 $ 2,371
Electronics 956 1,101
PST 2,687 3,169
Corporate 14 45
Total depreciation and amortization^(B) $ 6,116 $ 6,686
Interest Expense, net:
Control Devices $ 85 $ 61
Electronics 45 199
PST 420 668
Corporate 728 4,001
Total interest expense, net $ 1,278 $ 4,929
Capital Expenditures:
Control Devices $ 4,035 $ 1,734
Electronics 1,938 647
PST 1,373 1,667
Corporate 1,144 59
Total capital expenditures $ 8,490 $ 4,107

The following table presents net sales and long-term assets for each of the geographic areas in which the Company operates:

The Company has a 49% interest in Minda Stoneridge Instruments Ltd. (“Minda”), a company based in India that manufactures electronics, instrumentation equipment and sensors primarily for the motorcycle and commercial vehicle market. The investment is accounted for under the equity method of accounting. The Company's investment in Minda, recorded as a component of investments and other long-term assets, net on the condensed consolidated balance sheets, was ~~$6,899~~$7,067 and ~~$6,653~~$6,929 at March 31, ~~2015~~2016 and December 31, ~~2014,~~2015, respectively. Equity in earnings of Minda included in the condensed consolidated statements of operations was ~~$189~~$143 and ~~$238,~~$189, for the three months ended March 31, 2016 and 2015, ~~and 2014,~~ respectively.

The Company has a 74% controlling interest in PST. Noncontrolling interest in PST increased to $13,370 at March 31, 2016 due to comprehensive income of $60 resulting from a favorable change in foreign currency translation of $1,190 partially offset by a proportionate share of its net loss of $1,130 for the three months ended March 31, 2016. Noncontrolling interest in PST decreased to $18,321 at March 31, 2015 due to comprehensive loss of $4,229 resulting from a proportionate share of its net loss of $409 and an unfavorable change in foreign currency translation of $3,820. ~~Noncontrolling~~

PST has dividends payable declared in previous years to noncontrolling interest ~~in PST increased to $39,907~~of $10,842 Brazilian real ($3,046) at March 31, 2014 due to comprehensive income of $367 resulting from a favorable change in foreign currency translation of $1,345, partially offset by a proportionate share of its net loss of $978 for the three months ended March 31, 2014.2016.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

We are a global designer and manufacturer of highly engineered electrical and electronic components, modules and systems for the automotive, commercial, motorcycle, off-highway and agricultural vehicle markets.

We are primarily organized by products produced and markets served. Under this structure, our continuing operations have been reported utilizing the following segments:

Control Devices.This segment includes results of operations that manufacture sensors, switches, valves and actuators.

Electronics.This segment includes results of operations from the production of electronic instrument clusters, electronic control units and driver information systems.

PST.This segment includes results of operations that design and manufacture electronic vehicle alarms, convenience accessories, vehicle tracking devices and monitoring services and in-vehicle audio and video devices.

During the second quarter of 2014 we entered into an asset purchase agreement to divest our Wiring business, which designed and manufactured wiring harness products and assembled instrument panels principally for the commercial, agricultural and off-highway vehicle markets. On August 1, 2014, the Company completed the sale of substantially all of the assets and liabilities of the Wiring business. As a result of the sale, this business is classified as discontinued operations in our condensed consolidated financial statements and no discussion and analysis of financial condition and results of operations is provided herein.

The Company had income from continuing operations attributable to Stoneridge, Inc. of $2.5 million, or $0.09 per diluted share and a loss from discontinued operations attributable to Stoneridge, Inc. of $0.2 million, or $(0.01) per diluted share resulting in net income attributable to Stoneridge, Inc. of $2.3 million, or $0.08 per diluted share for the three months ended March 31, 2015.

Income from continuing operations attributable to Stoneridge. Inc. of $7.2 million, or $0.26 per diluted share for the three months ended March 31, 2016 increased by $4.7 million, or $0.17 per diluted share from $2.5 million, or $0.09 per diluted share for the three months ended March 31, ~~2015 increased by $2.0 million, or $0.07 per diluted share from $0.5 million, or $0.02 per diluted share for the three months ended March 31, 2014.~~2015. The increase in income from continuing operations is ~~primarily~~ due to an increase in gross profit primarily related to higher sales in our Control Devices segment and lower ~~interest expense of $3.7 million~~material costs in our Electronics segment resulting from the financing of our debt in the second half of 2014 and improvement in other income (expense), net primarily associated with a less unfavorable effect of foreign currency translation of $2.1 million. Also, our selling, general and administrative and design and development costs decreased primarily from a change in foreign currency exchange ~~rates of $3.3 million which were partially offset by an increase in compensation expense as a result of~~rates. Also, selling, general and administrative expenses decreased due to the ~~acceleration of~~accelerated vesting of share-based awards in connection with the retirement of our former President and Chief Executive Officer (“CEO”) ~~which was~~in the first quarter of 2015 of $2.2 million. These were partially offset by ~~a $4.5 million decrease in gross profit primarily in~~2016 business realignment charges related to our Electronics and PST segments ~~which was due to~~of $1.2 million and $0.7 million, respectively, and higher ~~material costs and an unfavorable foreign currency translation both resulting from an unfavorable change in foreign currency exchange rates.~~income tax expense of $0.7 million for the three months ended March 31, 2016.

Net sales ~~increased~~decreased by ~~$1.5~~$0.2 million, or ~~0.9%~~0.1%, ~~from higher sales in our Electronics and Control Devices segments during~~compared to the first quarter of 2015 ~~which~~as higher sales in our Control Devices segment were ~~substantially~~ offset by lower sales in our PST ~~segment.~~and Electronics ~~segment~~segments. The increase in sales ~~increased due to higher North American and European commercial vehicle product sales while~~in our Control Devices segment ~~sales increased~~was due to ~~higher~~new product sales and growth in North American ~~and China~~ automotive market ~~sales.~~sales while our PST and Electronics segment sales ~~declined~~decreased due to an unfavorable foreign currency translation and lower ~~product~~ sales volume.

At March 31, ~~2015~~2016 and December 31, ~~2014,~~2015, we had cash and cash equivalents ~~balance~~balances of ~~$23.9~~$48.4 million and ~~$43.0~~$54.4 million, respectively. The decrease during the first quarter of 2016 was primarily due to maintaining higher working capital ~~capital expenditures and repayment of debt.~~levels. At March 31, ~~2015~~2016 and December 31, ~~2014~~2015 we had $100.0 million in borrowings outstanding on our $300.0 million Credit Facility.

~~The~~We expect improved financial performance to continue throughout 2016 compared to 2015 because of new product launches and savings from previously incurred business realignment activities.

We expect to have significant sales growth in our North American automotive vehicle market in 2016 related to new product launches including our shift by wire product by our Control Devices segment. Also, the North American automotive vehicle market production is ~~forecasted~~expected to ~~be in the range of 17.0 million~~increase to ~~17.4~~18.2 million units in ~~2015 compared to 17.0~~2016 (an increase from the 17.5 million units produced in ~~2014. The improvement in the North American automotive vehicle market and sales of new products had~~2015), which we expect to have a favorable effect on our Control Devices ~~segment’s results during the first quarter of 2015. We expect this will continue for the remainder of 2015.~~segment.

The North American commercial vehicle market is ~~forecasted~~expected to ~~improve~~decline for the remainder of ~~2015. We expect this to have a favorable effect on our Control Devices and Electronics segments.~~

~~The~~2016 while the European commercial vehicle market is forecasted to ~~have modest improvement throughout~~remain at approximately the ~~remainder of 2015 which is expected to have a favorable effect on our Electronics segment.~~same level with 2015.

Our PST segment revenues and operating performance ~~continued~~continue to be ~~weak due to a significant~~adversely impacted by weakness of the Brazilian economy and automotive ~~market. The~~market and was negatively impacted by unfavorable foreign currency translation. In April 2016, the International Monetary Fund (IMF) lowered its forecasts for the Brazil gross domestic product (“GDP”) to decline ~~by 1.0%~~3.8% in ~~2015~~2016 and ~~increase by only 1.0%~~then remain level in ~~2016.~~2017. Based on the ~~weakness in PST’s sales and operating performance in the first quarter of 2015 and lower~~ forecasted negative GDP growth of the Brazilian economy in 2016, PST’s sales and earnings ~~growth~~ expectations ~~for the remainder of 2015~~ continue to be moderated. ~~Since~~As there is significant uncertainty regarding the timing and magnitude of a recovery in the Brazilian economy and automotive market, PST ~~will continue~~continues to realign its cost structure to mitigate the effect on earnings and cash flows of possible continued weakened product demand and unfavorable foreign currency exchange ~~rates~~rates.

We regularly evaluate the performance of our businesses and their cost structures, including personnel, and make necessary changes thereto in ~~2015.~~order to optimize our results. We also evaluate the required skill sets of our personnel and periodically make strategic changes. As a consequence of these actions, we incur severance related costs which we refer to as business realignment charges.

A significant portion of our sales are outside of the United States. These sales are generated by our non-U.S. based operations, and therefore, ~~changes~~movements in foreign currency exchange rates can have a significant effect on our results of operations, which are presented in U.S. dollars. ~~Our operating results have been negatively impacted~~A significant portion of our raw materials purchased by ~~unfavorable changes~~our Electronics and PST segments are denominated in U.S. dollars, and therefore movements in foreign currency exchange rates can also have a significant effect on our results of operations. While the U.S. dollar strengthened significantly against the Swedish krona, euro and Brazilian real in ~~2014~~2015 increasing our material costs and reducing our reported results, the U.S. dollar weakened against these currencies in the first quarter of ~~2015 which may continue for the remainder of 2015.~~2016.

Because of the competitive nature of the markets we serve, ~~in the ordinary course of business~~ we face pricing pressures from our ~~customers.~~customers in the ordinary course of business. In response to these pricing pressures we have been able to effectively manage our production costs by the combination of lowering certain costs and limiting the increase of others, the net impact of which has not been material. However, if we are unable to effectively manage production costs in the future to mitigate future pricing pressures, our results of operations would be adversely affected.

In March 2016, we announced the relocation of our corporate headquarters from Warren, Ohio to Novi, Michigan, which will occur primarily during the third and fourth quarters of 2016. As a result, the Company will incur relocation costs of approximately $2.0 million to $2.5 million including employee retention, severance, recruiting, relocation and professional fees. The new headquarters will expand our presence in the Detroit metropolitan area and improve access to key customers, decision makers and influencers in the automotive and commercial vehicle markets that we serve. In connection with the relocation, the Company is eligible for a Michigan Business Development Program grant of up to $1.4 million based upon the number of new jobs created in Michigan, along with talent services and training support from Oakland County Michigan Works!. Also, the city of Novi has offered support in the form of property tax abatements.

Three Months Ended March 31, ~~2015~~2016 Compared to Three Months Ended March 31, ~~2014~~2015

Condensed consolidated statements of operations as a percentage of net sales are presented in the following table (in thousands):

Net Sales.Net sales for our reportable segments, excluding inter-segment sales, are summarized in the following table (in thousands):

Our Control Devices segment net sales increased primarily due to new product sales and growth in ~~our~~the North American automotive market ~~and higher volume in our China automotive market~~ of ~~$1.9~~$11.9 million and ~~$1.3 million, respectively, partially offset by lower~~new product sales and higher volume in our commercial vehicle market of $1.0 million during the first quarter of ~~2015 when compared to the first quarter~~2016 which were offset by a decrease in agricultural sales volume of ~~2014.~~$0.2 million.

Our Electronics segment net sales ~~increased~~decreased primarily due to ~~an increase~~a decrease in sales ofvolume in our North American ~~and European~~ commercial vehicle products of ~~$8.7~~$2.9 million and ~~$6.4 million, respectively, partially resulting from higher volume related to post-disposition sales to the Wiring business acquired by Motherson of $7.1 million, which were partially offset by~~ an unfavorable ~~change in~~ foreign currency translation of ~~$8.7~~$0.8 million.

Our PST segment net sales decreased primarily due to an unfavorable ~~change in~~ foreign currency translation which reduced sales by ~~$5.5~~$7.1 million, or ~~16.3%, and~~26.6% as well as lower product ~~volume. PST’s audio~~volume as a result of continued weakness in the Brazilian economy and ~~car alarm sales volume declined while monitoring service revenues increased.~~automotive market.

Net sales by geographic location are summarized in the following table (in thousands):

The increase in North American net sales was primarily attributable to ~~increased~~new product sales and growth in our Control Devices North American automotive market of $11.9 million which was partially offset by decreased sales volume in our Electronics North American commercial vehicle ~~and automotive markets~~market of ~~$8.4 million and $1.9 million, respectively. Our~~$2.9 million. The decrease in net sales in South America was ~~primarily~~ due to ~~the negative impact of~~an unfavorable foreign currency translation and lower PST product ~~sales volume. Our~~volume as a result of weakness in the Brazilian economy and automotive market. The decrease in net sales in Europe and Other was primarily due to an unfavorable ~~change in~~ foreign currency translation of ~~$8.7 million, which was substantially offset by increased sales of European commercial vehicle and Chinese automotive market products of $6.4 million and $1.3 million, respectively.~~$0.8 million.

Cost of Goods Sold and Gross Margin. Cost of goods sold ~~increased~~decreased by ~~5.3%~~1.4% primarily related to ~~higher material costs resulting from unfavorable changes~~a favorable change in foreign currency exchange ~~rates.~~rates in our Electronics segment which decreased its direct material costs. Our material cost as a percentage of net sales ~~increased~~decreased to 51.1% for the first quarter of 2016 compared to 51.6% for the first quarter of ~~2015 compared to 47.9% for the first quarter of 2014.~~2015. As a result, our gross margin ~~decreased~~increased by 1.0% to 27.8% for the first quarter of 2016 compared to 26.8% for the first quarter of ~~2015 compared to 29.8% for the first quarter of 2014.~~2015. The ~~higher material costs and lower gross margin were primarily due to unfavorable changes in foreign currency exchange rates in our Electronics and PST segments, which were partially offset by~~ lower direct material costs in our ~~Control Devices~~Electronics segment ~~resulting from a favorable mix of products sold.~~were partially offset by higher direct material costs in our PST segment due to unfavorable movement in foreign currency exchange rates.

Our Control Devices segment gross margin increased primarily due to the benefit of increased sales ~~volume and a favorable mix of products sold, which was partially offset by higher warranty costs.~~levels.

Our Electronics segment gross margin ~~decreased~~increased primarily due to ~~higher~~lower material costs resulting from ~~an unfavorable change~~a movement in foreign currency exchange rates.

Our PST segment gross margin ~~remained flat~~decreased as sales price increases were more than offset by higher material costs, ~~resulting from an unfavorable change in foreign currency exchange rates were offset by a favorable~~lower sales ~~mix.~~volume and business realignment charges of $0.2 million.

Selling, General and Administrative (“SG&A”). SG&A expenses ~~remained consistent with~~decreased by $5.0 million compared to the first quarter of ~~2014 as~~2015 due to lower SG&A costs in our ~~Electronics and~~ PST ~~segments were offset by higher share-based and performance-based compensation expense. SG&A costs in our Electronics and PST segments decreased~~segment primarily ~~as a result of a change~~due to foreign currency translation resulting from movement in foreign currency exchange ~~rates while~~rates. Also, SG&A expenses in our unallocated corporate segment decreased due to lower share-based compensation ~~increased~~of $2.2 million incurred in connection with ~~the~~ accelerated vesting associated with the retirement of our former President and CEO ~~which~~of $2.2 million in the first quarter of 2015. SG&A expenses in our Electronics segment decreased slightly due to a favorable change in foreign currency exchange rates. Partially offsetting this decrease was ~~$2.2 million.~~higher professional fees and other expenses related to unallocated corporate and an increase in total SG&A business realignment charges of $0.7 million related to our Electronics and PST segments for the first quarter of 2016.

Design and ~~Development.~~Development (“D&D”).~~Design~~D&D costs increased by $1.1 million primarily due to business realignment charges in our Electronics segment and development costs ~~decreased by $1.2 million primarily as a result of a change~~related to new product launches in ~~foreign currency exchange rates in~~our Control Devices segment. Business realignment charges related to our Electronics and PST segments ~~while~~were $1.0 million for the ~~Control Devices segment had lower~~first quarter of 2016. The increase in product development ~~costs.~~costs was partially offset by lower costs in our PST segment due to a favorable movement in foreign currency exchange rates.

Operating ~~Income (Loss).~~Income.Operating income (loss) is summarized in the following table by continuing reportable segment (in thousands):

Our Control Devices segment operating income increased primarily due to an increase in sales ~~a favorable change in~~which was partially offset by higher D&D costs related to new product ~~mix and lower design and development costs.~~launches.

Our Electronics segment operating income ~~decreased~~increased primarily due to ~~a decrease in gross profit as~~lower material costs ~~increased,~~ which ~~was~~were partially offset by ~~lower SG&A and design and development costs all~~an increase in business realignment charges of ~~which were a result~~$1.2 million for the first quarter of ~~fluctuations in foreign currency exchange rates.~~2016.

Our PST segment operating ~~income~~performance decreased ~~slightly as lower sales and gross profit~~primarily due to business realignment charges of $0.7 million for the first quarter of 2016. Sales price increases were substantially offset by higher material costs resulting from an unfavorable ~~change~~movement in foreign currency exchange rates and lower ~~product~~sales volume ~~were substantially offset by lower SG&A~~as a result of continued weakness in the Brazilian economy and ~~design and development costs.~~automotive market.

Our unallocated corporate operating loss ~~increased~~decreased primarily due to ~~higher~~lower share-based compensation expense as ~~a result of~~the prior period included expense for the acceleration of the vesting associated with the retirement of our President and CEO of $2.2 ~~million as well as~~million. This decrease was partially offset by higher ~~performance-based compensation.~~professional fees and other expenses.

Operating income (loss) by geographic location is summarized in the following table (in thousands):

~~North American operating income includes interest expense, net of approximately $0.7 million and $3.9 million for the quarters ended March 31, 2015 and 2014, respectively.~~

Our North American operating results ~~decreased~~increased primarily due to higher share-based compensation expense as a result of the acceleration of the vesting of share-based awards in connection with the retirement of our former President and CEO, which was partially offset by increased sales in the North American ~~commercial vehicle and~~ automotive ~~markets and a favorable change in product mix.~~market which were partially offset by higher D&D costs. The decrease in ~~profitability~~performance in South America was primarily due to an unfavorable change in foreign currency exchange rates, ~~and~~ lower sales ~~volume.~~volume and $0.7 million in business realignment charges. Our results in Europe and Other ~~were negatively affected by higher~~increased due primarily to lower material costs resulting from ~~an unfavorable change~~a favorable movement in foreign currency exchange rates ~~related to our Electronics segment.~~offset by lower sales volume and an increase in D&D costs resulting from business realignment charges.

Interest Expense, net. Interest expense, net ~~decreased~~increased by ~~$3.7~~$0.2 million ~~during the first quarter of 2015 when~~ compared to the prior year first quarter primarily due to a ~~lower average debt balance outstanding and a lower~~higher weighted-average interest ~~rate. We redeemed~~rate related to our $175.0 million 9.5% senior secured notes in September and October 2014 using borrowings of $100.0 million on our Credit Facility (which bore annual interest of approximately 1.8% in the first quarter of 2015), proceeds from the sale of the Wiring business and existing cash.PST debt.

Equity in Earnings of Investee. Equity earnings for Minda ~~was~~were $0.1 million and $0.2 million for the three months ended March 31, 2016 and 2015, respectively. The slight increase in sales over the prior period was more than offset by higher operating costs and ~~2014, respectively.~~an unfavorable change in foreign currency exchange rates.

Other (Income) Expense, ~~(Income),~~ net. Other expense (income), net was ($0.2) million for the first quarter of 2015 compared to $1.9 million for the first quarter of 2014 due to less volatility in certain foreign exchange rates in the current period. Our PST segment was unfavorably affected by a significant foreign currency translation loss related to the Argentinian peso in the first quarter of 2014 which did not recur in the first quarter of 2015. We record certain foreign currency transaction and forward currency hedge contract ~~gains and~~(gains) losses as a component of other (income) expense, ~~(income),~~ net on the condensed consolidated statement of operations. Other expense, net increased by $0.4 million to $0.1 million for the first quarter of 2016 compared to $(0.2) million for the first quarter of 2015 due to an unfavorable change in certain foreign exchange rates primarily related to the Argentinian peso.

~~Provision~~Expense (Benefit) for Income Taxes from Continuing Operations. We recognized an income tax ~~provision~~expense of $0.8 million and $0.1 million ~~and $0.3 million~~from continuing operations for federal, state and foreign income taxes for the first quarter of ~~2015~~2016 and ~~2014,~~2015, respectively. The ~~effective~~increase in tax ~~rate decreased from 171.5% in the first quarter of 2014 to 6.5% in the first quarter of 2015. The decrease in the tax provision and the effective tax rate~~expense for the three months ended March 31, ~~2015~~2016 compared to the same period for ~~2014~~2015 was primarily due to the ~~improved earnings of our U.S. operations and reduced earnings of our European operations which was partially offset by~~increase in consolidated earnings. In addition, tax expense increased due to the ~~smaller~~PST operating loss ~~at PST. In addition, we recognized~~which generated a ~~discrete tax expense related to certain foreign operations during~~benefit for the first quarter of ~~2014 which did not recur~~2015, however, due to the valuation allowance position taken in the fourth quarter of 2015, no longer provides a tax benefit in 2016. The effective tax rate increased to 12.2% in the first quarter of ~~2015.~~

~~We will continue~~2016 from 6.5% in the first quarter of 2015 primarily due to ~~maintain~~the PST loss which, due to a full valuation allowance, negatively impacts the effective tax rate. The impact of PST on the effective tax rate was partially offset by income from our U.S. ~~deferred tax assets until there is sufficient evidence~~operations which, due to ~~support the reversal of all or some portion of this allowance. As~~ a result of the sale of the Wiring business and debt refinancing during the second half of 2014 and anticipated future earnings, we believe that there may be a reasonable possibility that sufficient positive evidence could develop within the next 12 months that may allow us to reach a conclusion that some or all of thefull valuation allowance, ~~on our U.S. deferred~~positively impacts the effective tax assets will no longer be needed. Reversal of some or all of the U.S. valuation allowance would result in the recognition of certain deferred tax assets and an income tax benefit in the period the reversal is recorded. However, the exact timing and amount of the valuation allowance reversal are subject to change on the basis of the level of profitability that we are able to actually achieve.rate.

~~The decrease in cash used for~~Cash provided by operating activities, ~~for~~which includes cash flows from the ~~first three months of~~Wiring discontinued operations in 2015, ~~compared to the same period in 2014 was~~increased primarily due to lower working capital ~~required as a result of the sale of the Wiring business in August 2014~~ and an increase in net income. Our receivable terms and collections rates have remained consistent between periods presented.

~~The increase in net~~Net cash used for investing activities ~~for the first three months of 2015 is~~decreased due to lower capital expenditures in the ~~increase in capital expenditures.~~current period.

~~The increase in net~~Net cash used for financing activities ~~was~~decreased primarily due to lower ~~borrowings and an increase~~repayments of debt in ~~principal payments on debt of $8.5 million and $1.7 million, respectively.~~the current period.

As outlined in Note 7 to our condensed consolidated financial statements, our Credit Facility permits borrowing up to a maximum level of $300.0 million which includes an accordion feature which allows the Company to increase the availability by up to $80.0 million upon the satisfaction of certain conditions. This variable rate facility provides the flexibility to refinance other outstanding debt or finance acquisitions through September 2019. The Credit Facility contains certain financial covenants that require the Company to maintain less than a maximum leverage ratio and more than a minimum interest coverage ratio. The Credit Facility also contains affirmative and negative covenants and events of default that are customary for credit arrangements of this type including covenants which place restrictions and/or limitations on the Company’s ability to borrow money, make capital expenditures and pay dividends. The Credit Facility had an outstanding balance of $100.0 million at March 31, ~~2015.~~2016. The Company was in compliance with all covenants at March 31, ~~2015.~~2016. The covenants included in our Credit Facility to date have not and are not expected to limit our financing flexibility.

PST maintains several short-term obligations and long-term loans used for working capital purposes. At March 31, ~~2015,~~2016, there was ~~$21.3~~$20.7 million ~~outstanding~~of PST debt outstanding. Principal payments on ~~the~~ PST ~~term loans. The PST loans~~debt at March 31, ~~2015 mature~~2016 are as follows: ~~$13.9~~$16.5 million from April 2015 to March 2017, $1.4 million from April 2017 to December 2017, $1.1 million in ~~2015, $2.2~~2018, $1.0 million in ~~2016, $2.1 million in 2017, $1.2 million in both 2018 and~~ 2019, $0.4 million in 2020 and $0.3 million in 2021.

The term loan for our Suzhou, China subsidiary is in the amount of 9.0 million Chinese yuan and matured in April 2015. The U.S. dollar equivalent outstanding loan balance was $1.5 million at March 31, 2015. The Suzhou note is included on the condensed consolidated balance sheets as a component of current portion of long-term debt. Interest is payable quarterly at 120.0% of the one-year lending rate published by The People's Bank of China.

The Company's wholly owned subsidiary located in Stockholm, Sweden, has an overdraft credit line which allows overdrafts on the subsidiary's bank account up to a maximum level of 20.0 million Swedish krona, or ~~$2.3~~$2.5 million, at March 31, ~~2015.~~2016. At March 31, ~~2015,~~2016, there were no overdrafts on the bank account.

Due to the deterioration of the Brazilian economy and automotive market in 2015 and first quarter of 2016, PST had lower earnings and cash flows. Also, PST has experienced slower customer payments of receivables, which combined with lower earnings has made its liquidity more challenging. As such, PST has and continues to evaluate and utilize several funding sources including factoring receivables and short-term loans from banks to provide necessary funding.

Although the Company's notes and credit facilities contain various covenants, the violation of which would limit or preclude their use or accelerate the maturity, the Company has not experienced and does not expect these covenants to restrict our financing flexibility. The Company has been and expects to continue to remain in compliance with these covenants during the term of the notes and credit facilities.

Our future results could also be adversely affected by unfavorable foreign currency exchange rates. We have significant foreign denominated transaction exposure in certain locations, especially in Brazil, Argentina, Mexico, Sweden, Estonia and ~~Estonia.~~China. We have entered into foreign currency forward contracts to reduce our exposure related to certain foreign currency fluctuations. See Note 6 to the condensed consolidated financial statements for additional details. Our future results could also be unfavorably affected by increased commodity prices as commodity fluctuations impact the cost of our raw material purchases.

At March 31, ~~2015,~~2016, we had a cash and cash equivalents balance of approximately ~~$23.9~~$48.4 million, of which ~~$6.9~~$22.0 million was held in the United States and ~~$17.0~~$26.4 million was held in foreign locations. The decrease from ~~$43.0~~$54.4 million at December 31, ~~2014~~2015 was due to higher working capital, capital expenditures ~~and~~to support the launch of new products, repayment of ~~debt.~~debt and the repurchase of common shares to satisfy employee tax withholding obligations.

See Note 10 to the condensed consolidated financial statements for disclosures of the Company’s commitments and contingencies.

Our Control Devices and Electronics segments are not typically affected by seasonality, however the demand for our PST segment consumer products is typically higher in the second half of the year, the fourth quarter in particular.

The Company's critical accounting policies, which include management's best estimates and judgments, are included in Part II, Item 7, to the consolidated financial statements of the Company's ~~2014~~2015 Form 10-K. These accounting policies are considered critical as disclosed in the Critical Accounting Policies and Estimates section of Management's Discussion and Analysis of the Company's ~~2014~~2015 Form 10-K because of the potential for a significant impact on the financial statements due to the inherent uncertainty in such estimates.

Information regarding other significant accounting policies is included in Note 2 to our consolidated financial statements in Item 8 of Part II of the Company’s ~~2014~~2015 Form 10-K.

Given the current economic conditions of countries and recent fluctuations in certain foreign currency exchange rates and commodity prices, we believe that a negative change in such items could significantly affect our profitability.

~~the reduced purchases, loss or bankruptcy of a major customer;~~

~~the costs and timing of facility closures, business realignment, or similar actions;~~

~~a significant change in automotive, commercial, motorcycle, off-highway or agricultural vehicle production;~~

~~competitive market conditions and resulting effects on sales and pricing;~~

~~the impact on changes in foreign currency exchange rates on sales, costs and results, particularly the Brazilian real, euro, Argentinian peso, Swedish krona and Mexican peso;~~

~~our ability to achieve cost reductions that offset or exceed certain customer-mandated selling price reductions;~~

~~a significant change in general economic conditions in any of the various countries in which we operate;~~

~~labor disruptions at our facilities or at any of our significant customers or suppliers;~~

~~the ability of our suppliers to supply us with parts and components at competitive prices on a timely basis;~~

~~the amount of our indebtedness and the restrictive covenants contained in the agreements governing our indebtedness, including our credit facility;~~

~~customer acceptance of new products;~~

~~capital availability or costs, including changes in interest rates or market perceptions;~~

~~the failure to achieve the successful integration of any acquired company or business; and~~

~~those items described in Part I, Item IA (“Risk Factors”) of the Company's 2014 Form 10-K.~~

Item 3. Quantitative and Qualitative Disclosures About Market ~~Risk.~~Risk

There have been no material changes in market risk presented within Part II, Item 7A of the Company's ~~2014~~2015 Form 10-K.

Item 4. Controls and ~~Procedures.~~Procedures

Evaluation of Disclosure Controls and Procedures

As of March 31, ~~2015,~~2016, an evaluation was performed under the supervision and with the participation of the Company's management, including the principal executive officer (“PEO”) and principal financial officer (“PFO”), of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based on that evaluation, the Company's management, including the PEO and PFO, concluded that the Company's disclosure controls and procedures were effective as of March 31, ~~2015.~~2016.

Changes in Internal Control Over Financial Reporting

There were no changes in the Company's internal control over financial reporting during the three months ended March 31, ~~2015~~2016 that materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

PART II–OTHER INFORMATION

Item 1. Legal ~~Proceedings.~~Proceedings

We are involved in certain legal actions and claims primarily arising in the ordinary course of business. Although it is not possible to predict with certainty the outcome of these matters, we do not believe that any of the litigation in which we are currently engaged, either individually or in the aggregate, will have a material adverse effect on our business, consolidated financial position or results of operations. We are subject to a tax assessment in Brazil related to value added taxes on vehicle tracking and monitoring services for which the likelihood of loss is not probable although it may take years to resolve. WeIn addition, we are ~~also~~ subject to litigation regarding patent infringement. We are also subject to the risk of exposure to product liability claims in the event that the failure of any of our products causes personal injury or death to users of our products as well as product warranty and ~~there~~recall claims. There can be no assurance that we will not experience any material losses related to product liability, ~~losses in the future.~~warranty or recall claims. In addition, if any of our products prove to be defective, we may be required to participate in a government-imposed or customer OEM-instituted recall involving such products. See additional details of these matters in Note 10 to the condensed consolidated financial statements.

Item 1A. Risk ~~Factors.~~Factors

There have been no material changes with respect to risk factors previously disclosed in the Company's ~~2014~~2015 Form 10-K.

Item 2. Unregistered Sales of Equity Securities and Use of ~~Proceeds.~~Proceeds

The following table presents information with respect to repurchases of Common Shares made by us during the three months ended March 31, ~~2015.~~2016. These shares were delivered to us by employees as payment for the withholding taxes due upon vesting of restricted share awards:

Period Total number
of shares
purchased Average price
paid per share Total number of
shares purchased
as part of publicly
announced plans
or programs Maximum
number of shares
that may yet be
purchased under
the plans or
programs
1/1/15-1/31/15 - - N/A N/A
2/1/15-2/28/15 92,504 $ 12.77 N/A N/A
3/1/15-3/31/15 - - N/A N/A
Total 92,504

Period

Total number
of shares
purchased

Average price
paid per share

Total number of
shares purchased
as part of publicly
announced plans
or programs

Maximum
number of
shares that may
yet be purchased
under the plans
or programs

1/1/16-1/31/16

N/A

2/1/16-2/29/16

121,503

11.06

N/A

3/1/16-3/31/16

N/A

Total

121,503

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

None.

Item 5. Other Information

None.

Item 6. Exhibits

Reference is made to the separate, “Index to Exhibits,” filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	STONERIDGE, INC.

Date: May ~~7, 2015~~5, 2016	/s/ Jonathan B. DeGaynor
	Jonathan B. DeGaynor President and Chief Executive Officer
	(Principal Executive Officer)

Date: May ~~7, 2015~~5, 2016	/s/ George E. Strickler
	George E. Strickler
	Executive Vice President, Chief Financial Officer and Treasurer
	(Principal Financial and Accounting Officer)

INDEX TO EXHIBITS

Exhibit Number	Exhibit

10.1	~~Stoneridge, Inc.~~ Amendment No. 12 and Waiver to ~~the~~ Third Amended and Restated Credit Agreement dated February 23, 2016 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on ~~March 31, 2015)~~February 24, 2016).

10.2	Stoneridge, Inc. Amended and Restated Long-Term Incentive Plan - 2016 Performance Shares Agreement, ~~Upon Retirement between the Company and its former President and Chief Executive Officer, John Corey (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K~~ filed ~~on March 19, 2015).~~herewith.

10.3	~~Employment~~Stoneridge, Inc. Amended and Restated Long-Term Incentive Plan - 2016 Share Units Agreement, ~~between the Company and Jonathan DeGaynor, the newly appointed President and Chief Executive Officer (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K~~ filed ~~on March 19, 2015).~~herewith.

31.1	Chief Executive Officer certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.

31.2	Chief Financial Officer certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.

32.1	Chief Executive Officer certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.

32.2	Chief Financial Officer certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.

	101	XBRL Exhibits:
	101.INS	XBRL Instance Document
	101.SCH	XBRL Schema Document
	101.CAL	XBRL Calculation Linkbase Document
	101.DEF	XBRL Definition Linkbase Document
	101.LAB	XBRL Labels Linkbase Document
	101.PRE	XBRL Presentation Linkbase Document

	Ohio		34-1598949
	(State or other jurisdiction of		(I.R.S. Employer
	incorporation or organization)		Identification No.)

	9400 East Market Street, Warren, Ohio		44484
	(Address of principal executive offices)		(Zip Code)

Large accelerated filer ¨	Accelerated filer x	Non-accelerated filer ¨	Smaller reporting company ¨
		(Do not check if a smaller reporting company)


~~EX – 10.1~~
~~EX – 10.2~~
~~EX – 10.3~~
~~EX – 31.1~~
~~EX – 31.2~~
~~EX – 32.1~~
~~EX – 32.2~~

~~101~~	~~XBRL Exhibits~~:
~~101.INS~~	~~XBRL Instance Document~~
~~101.SCH~~	~~XBRL Schema Document~~
~~101.CAL~~	~~XBRL Calculation Linkbase Document~~
~~101.DEF~~	~~XBRL Definition Linkbase Document~~
~~101.LAB~~	~~XBRL Labels Linkbase Document~~
~~101.PRE~~	~~XBRL Presentation Linkbase Document~~	1

	March 31,			December 31,			March 31,			December 31,
(in thousands)	2015			2014			2016			2015
	(Unaudited)						(Unaudited)
ASSETS

Current assets:
Cash and cash equivalents	$	23,869		$	43,021		$	48,373		$	54,361
Accounts receivable, less reserves of $1,296 and $2,017, respectively		113,655			105,102
Accounts receivable, less reserves of $1,159 and $1,066, respectively								112,649			94,937
Inventories, net		71,942			71,253			69,367			61,009
Prepaid expenses and other current assets		26,902			26,135			24,918			21,602
Total current assets		236,368			245,511			255,307			231,909

Long-term assets:
Property, plant and equipment, net		83,405			85,311			88,563			85,264
Other assets:
Intangible assets, net		46,040			56,637
Goodwill		965			1,078
Intangible assets, net and goodwill								39,404			36,699
Investments and other long-term assets, net		10,543			10,214			10,452			10,380
Total long-term assets		140,953			153,240			138,419			132,343
Total assets	$	377,321		$	398,751		$	393,726		$	364,252

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:
Current portion of debt	$	15,917		$	19,655		$	16,827		$	13,905
Accounts payable		66,458			58,593			69,261			55,225
Accrued expenses and other current liabilities		37,728			42,066			38,799			38,920
Total current liabilities		120,103			120,314			124,887			108,050

Long-term liabilities:
Revolving credit facility		100,000			100,000			100,000			100,000
Long-term debt, net		7,471			10,651			4,206			4,458
Deferred income taxes		45,646			50,006			43,092			41,332
Other long-term liabilities		4,296			3,974			3,783			3,983
Total long-term liabilities		157,413			164,631			151,081			149,773

Shareholders' equity:
Preferred Shares, without par value, 5,000 shares authorized, none issued		-			-			-			-
Common Shares, without par value, 60,000 shares authorized, 28,900 and 28,853 shares issued and 28,018 and 28,221 shares outstanding at March 31, 2015 and December 31, 2014, respectively, with no stated value		-			-
Common Shares, without par value, 60,000 shares authorized, 28,958 and 28,907 shares issued and 27,838 and 27,912 shares outstanding at March 31, 2016 and December 31, 2015, respectively, with no stated value								-			-
Additional paid-in capital		196,029			192,892			200,350			199,254
Common Shares held in treasury, 882 and 632 shares at March 31, 2015 and December 31, 2014, respectively, at cost		(2,465	)		(1,284	)
Common Shares held in treasury, 1,120 and 995 shares at March 31, 2016 and December 31, 2015, respectively, at cost								(5,552	)		(4,208	)
Accumulated deficit		(52,535	)		(54,879	)		(24,866	)		(32,105	)
Accumulated other comprehensive loss		(59,545	)		(45,473	)		(65,544	)		(69,822	)
Total Stoneridge Inc. shareholders' equity		81,484			91,256
Total Stoneridge, Inc. shareholders' equity								104,388			93,119
Noncontrolling interest		18,321			22,550			13,370			13,310
Total shareholders' equity		99,805			113,806			117,758			106,429
Total liabilities and shareholders' equity	$	377,321		$	398,751		$	393,726		$	364,252

Three months ended March 31 (in thousands, except per share data)	2015			2014
Three months ended March 31, (in thousands, except per share data)							2016			2015

Net sales	$	162,825		$	161,331		$	162,616		$	162,825

Costs and expenses:
Cost of goods sold		119,177			113,193			117,455			119,177
Selling, general and administrative		30,742			30,767			25,772			30,742
Design and development		9,780			10,937			10,883			9,780

Operating income		3,126			6,434			8,506			3,126

Interest expense, net		1,278			4,929			1,514			1,278
Equity in earnings of investee		(189	)		(238	)		(143	)		(189	)
Other (income) expense, net		(213	)		1,915			181			(213	)
Income (loss) before income taxes from continuing operations		2,250			(172	)
Provision for income taxes from continuing operations		147			295
Income (loss) from continuing operations		2,103			(467	)
Discontinued operations:
Income from discontinued operations, net of tax		-			1,053
Loss on disposal, net of tax		(168	)		(96	)
Income (loss) from discontinued operations		(168	)		957

Income before income taxes from continuing operations								6,954			2,250

Income tax expense from continuing operations								845			147

Income from continuing operations								6,109			2,103

Loss from discontinued operations								-			(168	)

Net income		1,935			490			6,109			1,935

Net loss attributable to noncontrolling interest		(409	)		(978	)		(1,130	)		(409	)

Net income attributable to Stoneridge, Inc.	$	2,344		$	1,468		$	7,239		$	2,344

Earnings per share from continuing operations attributable to Stoneridge, Inc.:
Basic	$	0.10		$	0.02		$	0.26		$	0.10
Diluted	$	0.09		$	0.02		$	0.26		$	0.09
Earnings (loss) per share attributable to discontinued operations:

Loss per share attributable to discontinued operations:
Basic	$	(0.01	)	$	0.03		$	-		$	(0.01	)
Diluted	$	(0.01	)	$	0.03		$	-		$	(0.01	)

Earnings per share attributable to Stoneridge, Inc.:
Basic	$	0.09		$	0.05		$	0.26		$	0.09
Diluted	$	0.08		$	0.05		$	0.26		$	0.08

Weighted-average shares outstanding:
Basic		27,146			26,854			27,676			27,146
Diluted		27,893			27,409			28,156			27,893

	(330) 856-2443
	Registrant's telephone number, including area code

INDEX		Page
PART I–FINANCIAL INFORMATION

Item 1.	Financial Statements	3
	Condensed Consolidated Balance Sheets as of March 31, ~~2015~~2016 (Unaudited) and December 31, ~~2014~~2015	23
	Condensed Consolidated Statements of Operations (Unaudited) for the Three Months Ended March 31, ~~2015~~2016 and ~~2014~~2015	34
	Condensed Consolidated Statements of Comprehensive Income (Loss) (Unaudited) for the Three Months Ended March 31, ~~2015~~2016 and ~~2014~~2015	45
	Condensed Consolidated Statements of Cash Flows (Unaudited) for the Three Months Ended March 31, ~~2015~~2016 and ~~2014~~2015	56
	Notes to Condensed Consolidated Financial Statements (Unaudited)	67
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	2123
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	2930
Item 4.	Controls and Procedures	2930

PART II–OTHER INFORMATION

Item 1.	Legal Proceedings	2930
Item 1A.	Risk Factors	2930
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3.	Defaults Upon Senior Securities	3031
Item 4.	Mine Safety Disclosures	3031
Item 5.	Other Information	3031
Item 6.	Exhibits	3031

Signatures		3032
Index to Exhibits		3133

Three months ended March 31	2015			2014
Net sales	$	-		$	75,059
Cost of goods sold		-			68,407
Selling, general and administrative		-			5,370
Interest expense, net		-			11
Other expense, net		-			31
Income from operations of discontinued operations before income taxes^(A)		-			1,240
Income tax provision on discontinued operations		-			(187	)
Income from discontinued operations, net of tax^(C)		-			1,053

Loss on disposal^(B)		(178	)		(148	)
Income tax benefit on loss on disposal		10			52
Loss on disposal, net of tax		(168	)		(96	)

Income (loss) from discontinued operations	$	(168	)	$	957

Three months ended March 31	2015

Loss on disposal^(A)	$	(178	)
Income tax expense on loss on disposal		10
Loss on disposal, net of tax		(168	)

Loss from discontinued operations	$	(168	)

Three months ended March 31, 2014
Depreciation and amortization	$	1,255
Capital expenditures		479

					Prepaid expenses												Prepaid expenses
			Notional		and other current assets /				Accrued expenses and				Notional				and other current assets /					Accrued expenses and
	Amounts^(A)				other long-term assets				other current liabilities				amounts^(A)				other long-term assets					other current liabilities
	March 31,		December 31,		March 31,		December 31,		March 31,		December 31,		March 31,		December 31,		March 31,			December 31,		March 31,		December 31,
	2015		2014		2015		2014		2015		2014		2016		2015		2016			2015		2016		2015
Derivatives designated as hedging instruments
Cash Flow Hedges:
Forward currency contracts	$	19,796	$	26,266	$	1,510	$	479	$	574	$	478	$	16,660	$	22,208	$	3		$	474	$	63	$	84

Derivatives not designated as hedging instruments
Forward currency contracts	$	1,631	$	3,523		-		-	$	5	$	13	$	1,730	$	1,647		-	��		-	$	5	$	9
Fixed price commodity contracts		-		317		-		-		-	$	69

												Gain (loss) recorded					Loss reclassified from
												in other comprehensive					other comprehensive income
	Gain (loss) recorded in other comprehensive income (loss)					Gain (loss) reclassified from other comprehensive income (loss) into net income						income (loss)					(loss) into net income
	2015		2014			2015			2014			2016			2015		2016			2015
Derivatives designated as cash flow hedges:
Forward currency contracts	$	797	$	118		$	(138	)	$	(181	)	$	(494	)	$	797	$	(44	)	$	(138	)
Fixed price commodity contracts		-		(472	)		-			(30	)
Total derivatives designated as cash flow hedges	$	797	$	(354	)	$	(138	)	$	(211	)	$	(494	)	$	797	$	(44	)	$	(138	)

(A)	Fair values estimated using Level 1 inputs, which consist of quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. The Company did not have any recurring fair value estimates using Level 1 inputs at March 31, ~~2015~~2016 or December 31, ~~2014.~~2015.

(B)	Fair values estimated using Level 2 inputs, other than quoted prices, that are observable for the asset or liability, either directly or indirectly and include among other things, quoted prices for similar assets or liabilities in markets that are active or inactive as well as inputs other than quoted prices that are observable. For forward currency ~~and fixed price commodity,~~contracts, inputs include foreign currency exchange ~~rates and commodity indexes.~~rates.

(C)	Fair values estimated using Level 3 inputs consist of significant unobservable inputs. The Company did not have any recurring fair value estimates using Level 3 inputs at March 31, ~~2015~~2016 or December 31, ~~2014.~~2015.

							Interest rates at										Interest rates at
	March 31,			December 31,			March 31,				March 31,			December 31,			March 31,
	2015			2014			2015			Maturity	2016			2015			2016			Maturity
Revolving Credit Facility
Credit facility	$	100,000		$	100,000			1.83	%	September - 2019	$	100,000		$	100,000			1.69	%		September 2019

Debt
PST short-term obligations		8,608			11,249			12.72% - 15.97	%	Various 2015		14,205			11,556			4.85% - 19.66	%		2016 - 2017
PST long-term notes		12,726			16,770			4.00% - 8.00	%	2016 - 2021		6,504			6,428			6.2% - 8.0	%		2017 - 2021
Suzhou note		1,452			1,450			6.72	%	April - 2015
Other		602			837							324			379
Total debt		23,388			30,306							21,033			18,363
Less: current portion		(15,917	)		(19,655	)						(16,827	)		(13,905	)
Total long-term debt, net	$	7,471		$	10,651						$	4,206		$	4,458

	Foreign			Unrealized			Benefit
	currency			gain (loss)			plan
	translation			on derivatives			liability			Total
Balance at January 1, 2015	$	(45,603	)	$	1		$	129		$	(45,473	)

Other comprehensive income (loss) before reclassifications		(14,962	)		797			(45	)		(14,210	)
Amounts reclassified from accumulated other comprehensive loss		-			138			-			138
Net other comprehensive income (loss), net of tax		(14,962	)		935			(45	)		(14,072	)

Balance at March 31, 2015	$	(60,565	)	$	936		$	84		$	(59,545	)

Balance at January 1, 2014	$	(30,335	)	$	(111	)	$	(12	)	$	(30,458	)

Other comprehensive income (loss) before reclassifications		4,178			(354	)		-			3,824
Amounts reclassified from accumulated other comprehensive loss		-			211			-			211
Net other comprehensive income (loss), net of tax		4,178			(143	)		-			4,035

Balance at March 31, 2014	$	(26,157	)	$	(254	)	$	(12	)	$	(26,423	)

Three months ended March 31	2016
Electronics^(A)		1,180
PST^(B)		722
Total business realignment charges	$	1,902

											Dollar
											increase /
Three months ended March 31	2015					2014					(decrease)
Net sales	$	162,825		100.0	%	$	161,331		100.0	%	$	1,494
Costs and expenses:
Cost of goods sold		119,177		73.2			113,193		70.2			5,984
Selling, general and administrative		30,742		18.9			30,767		19.1			(25	)
Design and development		9,780		6.0			10,937		6.7			(1,157	)
Operating income		3,126		1.9			6,434		4.0			(3,308	)
Interest expense, net		1,278		0.8			4,929		3.1			(3,651	)
Equity in earnings of investee		(189	)	(0.1	)		(238	)	(0.2	)		49
Other expense (income), net		(213	)	(0.2	)		1,915		1.2			(2,128	)
Income (loss) before income taxes from continuing operations		2,250		1.4			(172	)	(0.1	)		2,422
Provision for income taxes from continuing operations		147		0.1			295		0.2			(148	)
Income (loss) from continuing operations		2,103		1.3			(467	)	(0.3	)		2,570
Discontinued operations:
Income from discontinued operations, net of tax		-		-			1,053		0.7			(1,053	)
Loss on disposal, net of tax		(168	)	(0.1	)		(96	)	(0.1	)		(72	)
Income (loss) from discontinued operations		(168	)	(0.1	)		957		0.6			(1,125	)
Net income		1,935		1.2			490		0.3			1,445
Net loss attributable to noncontrolling interest		(409	)	(0.2	)		(978	)	(0.6	)		569
Net income attributable to Stoneridge, Inc.	$	2,344		1.4	%	$	1,468		0.9	%	$	876

									Dollar			Percent
									increase /			increase /
Three months ended March 31	2015				2014				(decrease)			(decrease)
Control Devices	$	79,870	49.0	%	$	77,324	47.9	%	$	2,546			3.3	%
Electronics		56,432	34.7			50,091	31.1			6,341			12.7	%
PST		26,523	16.3			33,916	21.0			(7,393	)		(21.8	)%
Total net sales	$	162,825	100.0	%	$	161,331	100.0	%	$	1,494			0.9	%