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EXHIBIT 4(c)(iii)
AMENDMENT dated as of November 21, 1997, to
the Credit Agreement dated as of September 23, 1990
(as amended and restated as of February 7, 1997) (the
"Credit Agreement"), among ESCO ELECTRONICS
CORPORATION, a Missouri corporation ("ESCO"), DEFENSE
HOLDING CORP., a Delaware corporation (the
"Borrower"), the BANKS party thereto (the "Banks")
and MORGAN GUARANTY TRUST COMPANY OF NEW YORK, as
Agent (the "Agent").
A. Capitalized terms used and not otherwise defined
herein shall have the meanings assigned to them in the Credit Agreement, as
amended hereby.
B. ESCO and the Borrower have requested that certain
provisions of the Credit Agreement be amended as set forth herein. The Banks are
willing to so amend the Credit Agreement subject to the terms and conditions set
forth herein.
Accordingly, in consideration of the mutual agreements herein
contained and other good and valuable consideration, the sufficiency and receipt
of which are hereby acknowledged, the parties hereto hereby agree as follows:
SECTION 1. Amendments. (a) Section 1.01 of the Credit
Agreement is amended to add the following definitions in alphabetical order:
"Euroshield" means Euroshield OY.
"Euroshield Acquisition Corporation" means EMC Test Systems or
any other Wholly-Owned Consolidated Subsidiary.
"PTI Filters" means Sanmar - PTI Filters Limited.
(b) The second proviso in the second sentence of Section
5.08 of the Credit Agreement is hereby amended and restated as follows:
provided further, that the Borrower shall not be required to pledge or
create a security interest in any of the assets of SFL, FBV, FGMBH,
FSA, Filtrotec, PPD (including the capital stock of PPD) or Euroshield,
nor shall SFL, FBV, FGMBH, FSA, Filtrotec, PPD or Euroshield be
required to become a party to the
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Guarantee Agreement or the Security Agreement, and the pledge by the
Borrower of the capital stock of SFL, the pledge by Filtertek of the
capital stock of FBV, FGMBH, FSA and Filtrotec, and the pledge by
Euroshield Acquisition Corporation of the capital stock of Euroshield
shall be limited to 65% of each class of such capital stock.
(c) Section 5.09 of the Credit Agreement is hereby
amended and restated as follows:
SECTION 5.09. Subsidiaries; Partnerships. ESCO will
not have any direct Subsidiaries other than the Borrower and any
Restricted Subsidiaries. The Borrower will not have any direct or
indirect Subsidiaries, other than the Specified Subsidiaries and any
Subsidiaries resulting from any Investments made in accordance with
clause (f), (l) or (n) of Section 5.16 and any Restricted Subsidiaries,
all of which shall be direct Subsidiaries (except that (i) PPD shall be
a direct Subsidiary of SFL, (ii) Comtrak shall be a direct Subsidiary
of SEI, (iii) EMC Test Systems shall be a limited partnership as
described in the definition of "EMC Test Systems Reorganization", (iv)
Rantec shall be a direct Subsidiary of Rantec Holding as described in
the definition of "EMC Test Systems Reorganization", (v) Rantec
Commercial shall be a direct Subsidiary of Rantec as described in the
definition of "EMC Test Systems Reorganization", (vi) FBV, FGMBH,
Filtrotec, FDPR and FDB shall be direct subsidiaries of Filtertek,
(vii) FSA shall be a subsidiary of Filtertek and FBV, and (viii)
Euroshield shall be a subsidiary of Euroshield Acquisition
Corporation). Neither ESCO nor the Borrower will, and they will not
permit any of their Subsidiaries to, enter into any partnership or
joint venture other than EMC Test Systems, PTI Filters and a Permitted
Joint Venture. Notwithstanding anything to the contrary contained in
this Section (i) Uniexcel shall be a partially-owned Subsidiary of SFL,
(ii) Filtertek de Puerto Rico S.A. may issue Class B Common Stock to
certain of its senior executives, (iii) Filtertek may own less than all
of, but not less than 85% of, the outstanding common stock of FDB and
(iv) PTI may own not less than 40% and not more than 49% of the
outstanding common stock of PTI Filters.
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(d) Section 5.11(a) of the Credit Agreement is hereby
amended to add the following clauses (xiii) and (xiv) at the end of such
Section:
(xiii) Debt consisting of unsecured guarantees by ESCO, the
Borrower or PTI of 49% of the outstanding amount of loans to PTI
Filters made by local banks in India; provided that the aggregate
principal amount of such unsecured guarantees at any time outstanding
under this clause (xiii) shall not exceed $800,000; and
(xiv) following the completion of the acquisition of
Euroshield by Euroshield Acquisition Corporation, unsecured and secured
Debt of Euroshield and unsecured guarantees by ESCO, the Borrower or
Euroshield Acquisition Corporation of Debt of Euroshield, in each case,
in an amount not to exceed $2,500,000.
(d) Section 5.16 of the Credit Agreement is hereby
amended to add the following clauses (m) and (n) at the end of such Section:
(m) if at the time thereof and after giving effect
thereto no Default shall have occurred and be continuing, Investments
by PTI in PTI Filters consisting of (i) contributions of cash and
equipment with a book value not exceeding $255,000, which shall be
treated as an equity contribution, and (ii) loans made to, or
guarantees of loans made to, PTI Filters, to the extent permitted by
clause (xiii) of Section 5.11(a); provided that all Investments in PTI
Filters, made pursuant to this clause (m), including any guarantees of
Debt of PTI Filters, shall be treated as an Investment made pursuant to
clause (f) of this Section for purposes of determining compliance with
the limitations of such clause (f).
(n) if at the time thereof and after giving effect
thereto no Default shall have occurred and be continuing, Investments
by Euroshield Acquisition Corporation to effect the acquisition of
Euroshield consisting of (i) $3,500,000 of cash, (ii) $750,000 of
deferred purchase price payable over three years following such
acquisition, and (iii) $750,000 payable in the third year if certain
performance targets are met; provided that all Investments in
Euroshield, made pursuant to this clause (n), shall be treated as an
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Investment made pursuant to clause (f) of this Section for purposes of
determining compliance with the limitations of such clause (f).
(e) Section 5.17 of the Credit Agreement is hereby
amended to add the following clause (n) at the end of such Section:
(n) Liens of Euroshield to secure Debt of Euroshield
permitted by Section 5.11(a)(xiv).
SECTION 2. Representations and Warranties. Each of ESCO and
the Borrower hereby represents and warrants to each Bank, on and as of the date
hereof, that:
(a) This Amendment has been duly authorized, executed and
delivered by each of ESCO and the Borrower, and each of this Amendment and the
Credit Agreement as amended by this Amendment constitutes a legal, valid and
binding obligation of each of ESCO and the Borrower, enforceable in accordance
with its terms.
(b) The representations and warranties of each of ESCO
and Borrower contained in the Credit Agreement and in each other Loan Document
are true and correct in all respects with the same effect as if made on and as
of the date hereof, except to the extent that such representations and
warranties expressly relate to an earlier date.
(c) After giving effect to this Amendment, no Default has
occurred and is continuing.
SECTION 3. Effectiveness. This Amendment shall become
effective upon receipt by the Agent of counterparts hereof signed by each of
ESCO, the Borrower and the Required Banks.
SECTION 4. Miscellaneous. (a) This Amendment constitutes the
entire agreement and understanding of the parties with respect to the subject
matter hereof and supersedes any and all prior agreements and understandings,
oral or written, relating to the subject matter hereof.
(b) Section headings used herein are for convenience of
reference only and are not to affect the construction of, or to be taken into
consideration in interpreting, this Amendment.
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(c) This Amendment shall be construed in accordance with
and governed by the law of the State of New York.
(d) Each reference to a party hereto shall be deemed to
include its successors and assigns, all of whom shall be bound by this Amendment
and to whose benefit the provisions of this Amendment shall inure.
(e) This Amendment may be executed in any number of
counterparts, each of which shall be an original but all of which, when taken
together, shall constitute but one instrument.
(f) Except as specifically amended or modified hereby,
the Credit Agreement shall continue in full force and effect in accordance with
the provisions thereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed by their respective authorized officers as of the
date first above written.
ESCO ELECTRONICS CORPORATION
by
/s/ Donald H. Nonnenkamp
------------------------
Name: Donald H. Nonnenkamp
Title: Vice President &
Treasurer
DEFENSE HOLDING CORP.
by
/s/ Philip M. Ford
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Name: Philip M. Ford
Title: Sr. Vice President & CFO
MORGAN GUARANTY TRUST COMPANY OF
NEW YORK, individually and as Agent
by
/s/ Kevin J. O'Brien
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Name: Kevin J. O'Brien
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Title: Vice President
NATIONSBANK, N.A.
by
/s/ Kenneth J. Schult
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Name: Kenneth J. Schult
Title: Vice President
THE BANK OF NEW YORK
by
/s/ Christopher C. Jacobs
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Name: Christopher C. Jacobs
Title: Assistant Treasurer
THE BANK OF NOVA SCOTIA
by
/s/ F.C.H. Ashby
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Name: F.C.H. Ashby
Title: Senior Manager Loan
Operations
THE SUMITOMO BANK, LIMITED
by
/s/ Teresa A. Lekich
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Name: Teresa A. Lekich
Title: Vice President
by
/s/ Michael F. Murphy
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Name: Michael F. Murphy
Title: Vice President & Manager
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
by
/s/ Glenn Edwards
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Name: Glenn Edwards
Title: Vice President
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SANWA BUSINESS CREDIT CORPORATION
by
/s/ Lawrence J. Placek
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Name: Lawrence J. Placek
Title: Vice President