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CONFORMED COPY
AMENDMENT
THIS AMENDMENT is dated as of October 31, 1993 (hereinafter referred
to as this "Amendment") entered into by and among ESTERLINE TECHNOLOGIES
CORPORATION, a Delaware corporation (hereinafter referred to as "Esterline");
the Subsidiaries (this and other capitalized terms used hereinafter having the
meaning assigned thereto in the Credit Agreement referred to below) listed on
the signature pages hereof, the financial institutions listed on the signature
pages hereto (such financial institutuions being hereinafter collectively
called the "Banks" and individually called a "Bank"), and CONTINENTAL BANK N.A.
("Continental") as agent for the Banks (in such capacity, together with any
successor in such capacity, the "Agent").
BACKGROUND:
A. Esterline and certain of its Subsidiaries (herein called the
"Original Companies"), the Banks and the Agent have entered into that certain
Amended and Restated Credit Agreement, executed as of January 25, 1991 and
dated and effective as of September 18, 1989 and heretofore amended (as so
amended, the "Original Credit Agreement"). The Original Credit Agreement was
an amendment and restatement of that certain Credit Agreement dated as of
September 18, 1989 (the "1989 Credit Agreement") among the Original Companies,
the Banks and the Agent.
B. The Companies desire to further amend the Original Credit
Agreement so as to, among other things, revise certain covenants and the
commitments of the Banks.
C. The Banks and the Agent are willing to agree to such amendments on
the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the covenants
and conditions contained herein and for other good and valuable consideration
(the receipt of which is hereby acknowledged), the parties hereto, intending
legally to be bound, agree as follows:
SECTION 1. New Definition.
The following new defined term is hereby added to Appendix X to the
Original Credit Agreement, to be placed in the proper alphabetical order:
"Restructuring Charge" shall mean the restructuring provision
(in the amount of $40,626,000) shown in the consolidated statement of
operations for Esterline and its
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Subsidiaries dated as of October 31, 1993, a copy of which has been
delivered to each Banks.
SECTION 2. Amendments to Definitions.
The following defined terms in Appendix X to the Original Credit
Agreement are hereby amended and restated in their entireties to read as
follows:
"Consolidated Income Available for Fixed Charges" shall mean
for any period, the sum of (i) Consolidated Net Income for such
period, plus (to the extent deducted in determining Consolidated Net
Income), (ii) all provisions for any federal, state, or other income
taxes made by Esterline and its Subsidiaries during such period, (iii)
Fixed Charges for such period, (iv) amortization during such period of
goodwill and intangibles resulting solely from Esterline's acquisition
on September 27, 1989 of six Criton Technologies operating companies
from The Dyson-Kissner-Moran Corporation, and (v) the Restructuring
Charge.
"Funded Debt" shall mean (x) the consolidated Ratio
Indebtedness of Esterline and its Subsidiaries, determined in
accordance with generally accepted accounting principles, owed or
guaranteed which by its terms matures more than one year from the date
of creation (including any portion thereof payable within a year) or
which may be renewed or extended at the option of the obligor for more
than one year from such date whether or not theretofore renewed or
extended, excluding Ratio Indebtedness which may be payable on demand
(or within one year of creation) but which is incurred or issued under
a revolving credit or similar agreement providing for borrowings (or
renewables or extendibles) over a period of more than one year, unless
such Ratio Indebtedness is required to be reflected on the balance
sheet of the obligor as Funded Debt by generally accepted accounting
principles, and (y) the consolidated Ratio Indebtedness of Esterline
and its Subsidiaries, determined in accordance with generally accepted
accounting principles, owed or guaranteed which by its terms matures
less than one year from the date of creation unless (during the
Adjusted Twelve-Month Period with respect to which Funded Debt is
being calculated) there shall have been a period of 60 consecutive
days during which no such Ratio Indebtedness was outstanding.
"Interest Coverage Ratio" shall mean, as of any End Date, the
ratio of (x) the excess of (i) Consolidated Net Income determined
without deducting interest, depreciation, amortization, tax expense
and (if applicable) the Restructuring Charge for the Adjusted
Twelve-Month Period
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ending on such End Date, over (ii) Capital Expenditures made by
Esterline and the Subsidiaries during such Adjusted Twelve-Month
Period, to (y) Interest Outlay for such Adjusted Twelve-Month Period.
"EBIT/I Ratio" shall mean, as of any End Date, the ratio (x)
consolidated Net Income of Esterline and the Subsidiaries determined
without deducting interest and tax expense for the Adjusted Twelve
Month Period ending on such End Date, to (y) Interest Outlay for such
Adjusted Twelve Month Period; provided, however, for purposes of
calculating the Original Margins under Section 3.2 and the Letter of
Credit Fee pursuant to Section 4.4 with respect to any Adjusted
Twelve-Month Period that includes Esterline's fourth fiscal quarter of
1993, Consolidated Net Income of Esterline and the Subsidiaries shall
be determined without deducting interest and tax expense for the
Adjusted Twelve-Month Period ending on the relevant End Date and
without deducting the Restructuring Charge.
Section 3. Reduction of Facility A Commitments. The Banks
acknowledge that the Facility A Borrowers have permanently reduced the
aggregate amount of the Facility A Commitments to $35,000,000.
Section 4. Amendment to Net Worth Covenant. The first sentence of
Section 10.5(a) of the Original Credit Agreement shall be amended and restated
(except with respect to any period ending prior to the date hereof) in its
entirety to read as follows:
Not permit Adjusted Consolidated Net Worth to be less than the
greater of (x) the Net Worth Minimum (as defined in the next
sentence), and (y) the sum of $41,300,000 plus 50% of Consolidated Net
Income (without reduction for losses) from and including the first day
following the October, 1990 End Date to the date of calculation.
The second sentence of Section 10.5(a) of the Original Credit Agreement is
amended by deleting the figure "77,000,000" where it appears in clause (v)
thereof, and substituting therefor the figure "$49,800,000" and by deleting the
figure "$80,000,000" where it appears in clause (vi) thereof, and substituting
therefor the figure "$52,800,000".
SECTION 5. Senior Note Agreement Amendment. The Banks waive Section
10.30 of the Original Credit Agreement to the extent necessary to permit the
Companies to execute and deliver an amendment to the Senior Note Agreement
substantially in the form of Schedule I hereto.
SECTION 6. Assignments Commitments. The Parties acknowledge that
effective immediately prior to the effectiveness
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hereof, (i) National Canada Corporation has assigned all of its rights and
obligations under the Original Credit Agreement to Seafirst Bank, and (ii)
Pittsburgh National Bank has assigned all of its rights and obligations under
the Original Credit Agreement to Continental Bank, N.A. Each such Bank agrees
to enter into such assignment documents as the Agent shall direct to cause the
Commitments and outstanding Loans held by each Bank to reflect it adjusted
Percentages.
SECTION 7. Conditions Precedent. This Amendment shall be effective
from and after the later of (i) December 17, 1993 or (ii) the date upon which
all of the conditions precedent specified below have been satisfied (the
"Effective Date"); provided, however, the amendments referencing any time
period shall only be effective as to such periods commencing on or after the
Effective Date. The conditions precedent are:
(a) The Remaining Companies shall have paid to the Agent, for
the account of each Bank, an amendment fee equal to one quarter of one
percent on such Bank's Commitments.
(b) The representations and warranties of the companies set
forth in Section 8 shall be true and correct, and the Agent shall have
received the certificate of an appropriate officer of Esterline to the
effect that such representations and warranties are true and correct.
(c) All documents executed or submitted pursuant hereto by or
on behalf of the companies shall be satisfactory in form and substance
to the Agent and each Bank, and the Agent shall have received all
other information, documents, and instruments as any Bank shall have
reasonably requested.
SECTION 8. Representations and Warranties. Each of the Companies
represents and warrants to the Banks that:
(a) The execution and delivery by it of this Amendment, and
the performance of its obligations under the Original Credit Agreement
as amended by this Amendment (as so amended, the "Amended Agreement"),
are within its corporate powers, have been duly authorized by all
necessary corporate action, have received all necessary governmental
approvals (if any shall be required) and other consents or approvals
and do not and will contravene or conflict with, or create a lien
under, (i) any provision of law, (ii) its constituent documents, (iii)
any court or administrative degree applicable to it, or (iv) any
contractual restriction binding upon it or its property.
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(b) This Amendment has been duly executed and delivered by
it, and the Amended Agreement is its legal, valid and binding
obligation, enforceable against it in accordance with its terms.
(c) The warranties of the Companies set forth in the Original
Credit Agreement are true and correct as of the date hereof, except to
the extent that such warranties specifically relate to an earlier
date.
(d) After giving effect to this Amendment, no Event of
Default or Unmatured Event of Default shall have occurred and be
continuing.
SECTION 9. Miscellaneous.
(a) Section captions used in this Amendment are for
convenience only, and shall not affect the construction of this
Amendment.
(b) This Amendment shall be a contract made under and
governed by the internal laws of the State of Illinois without regard
to conflict of law principles.
(c) This Amendment may be executed in any number of
counterparts and by different parties on separate counterparts, and
each such counterpart shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same amendment.
(d) Any reference to the Original Credit Agreement or the
1989 Credit Agreement contained in any notice, request, certificate or
other document executed concurrently with or after the Effective Date
shall be deemed to be a reference to the Amended Agreement. Except as
expressly modified hereby, the Loan Documents are hereby ratified and
confirmed by the Companies. The Amended Agreement and the other Loan
Documents remain in full force and effect.
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute this Amendment as of the day and year first
above written.
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CONTINENTAL BANK N.A.
as Agent and individually
By: /s/ Elizabeth M. Nolan
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Name: Elizabeth M. Nolan
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Its: Vice President
ESTERLINE TECHNOLOGIES CORPORATION
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Executive Vice President
ARMTEC DEFENSE PRODUCTS CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
AUXITROL U.S.A., INC.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
AUXITROL CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
EQUIPMENT SALES CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
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ANGUS ELECTRONICS CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
EXCELLON AUTOMATION CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
EXCELLON U.K.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
FEDERAL PRODUCTS CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
FEDERAL PRODUCTS U.K. LTD.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
H.A. SALES CO., formerly known as
HOLLIS AUTOMATION CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: President
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HYTEK FINISHES CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
KORRY ELECTRONICS CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
MIDCON CABLES CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
REPUBLIC ELECTRONICS CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
TA MFG. CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
TULON CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
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W.A. WHITNEY CO
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
SCIENTIFIC COLUMBUS CO., formerly
known as JEMTEC ELECTCRONICS CO.
By: /s/ Robert W. Stevenson
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Robert W. Stevenson
Its: Vice President
NATIONAL CANADA CORPORATION
By:
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Its:
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U.S. BANK OF WASHINGTON, NATIONAL
ASSOCIATION
By: /s/ Mathew S. Thoreson
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Its: Vice President
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THE BANK OF TOKYO, LTD.
By: /s/ M. Tomi
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Its: General Manager
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FIRST INTERSTATE BANK OF
WASHINGTON, N.A.
By: /s/ Louise A. Kapustka
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Its: Vice President
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PNC BANK, NATIONAL ASSOCIATION formerly
PITTSBURGH NATIONAL BANK
By: /s/ J. Gregory Seibly
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Its: Vice President
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SEAFIRST BANK
By: /s/ Kevin S. Berry
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Its: Vice President
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