Exhibit 4.1
CONSENT AND WAIVER TO CREDIT AGREEMENT
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This CONSENT AND WAIVER TO CREDIT AGREEMENT (this "Agreement") is entered
into and effective as of January 20, 2006, by and among ESCO TECHNOLOGIES INC.,
a Missouri corporation ("Borrower"), XXXXX FARGO BANK, NATIONAL ASSOCIATION
("Xxxxx Fargo"), as Administrative Agent ("Administrative Agent"), and Xxxxx
Fargo and the other lenders listed on the signature pages hereto (the
"Lenders").
Recitals:
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A. Borrower, Administrative Agent and Lenders have heretofore entered into
that certain Credit Agreement dated as of October 6, 2004, as amended from
time to time (as amended, the "Credit Agreement;" all capitalized terms
used and not otherwise defined in this Agreement shall have the respective
meanings ascribed to them in the Credit Agreement as amended by this
Agreement).
B. Administrative Agent, Lenders and Borrower have agreed to the provisions
set forth herein on the terms and conditions contained herein.
Agreement
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Therefore, in consideration of the mutual agreements herein and other
sufficient consideration, the receipt of which is hereby acknowledged, Borrower,
Administrative Agent and Lenders hereby agree as follows:
1. Consent. Borrower has notified Administrative Agent and Lenders regarding the
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possible acquisition of Hexagram, Inc., an Ohio corporation, by ESCO
Technologies Holding Inc. (the "Hexagram Acquisition") for an initial purchase
price not to exceed $70,000,000.00 plus contingent payments not to exceed
$7,500,000.00 payable over five (5) years (collectively, the "Purchase Price").
Section 5.14 of the Credit Agreement provides that Borrower will not, and it
will not cause or permit any Subsidiary to, consummate any Acquisitions other
than Permitted Acquisitions. The Purchase Price may exceed the limitation set
forth in subsection (e) of the definition of Permitted Acquisition. Furthermore,
the Purchase Price, when aggregated with the purchase price paid in connection
with the acquisition by ESCO Technologies Holding Inc. of Nexus Energy Software,
Inc., a Massachusetts corporation, on November 29, 2005 (the "Nexus
Acquisition"), exceeds the limitation set forth in subsection (f) of the
definition of Permitted Acquisition. At the request of Borrower, Administrative
Agent and Lenders hereby (a) waive the application of subsections (e) and (f) of
the definition of Permitted Acquisition to the Hexagram Acquisition, (b) consent
to the consummation of the Hexagram Acquisition for consideration not exceeding
the Purchase Price, subject to the fulfillment of the remaining conditions of
the definition of Permitted Acquisition, and (c) agree to exclude the Hexagram
Acquisition and Nexus Acquisition from the annual Acquisition limitation set
forth in subsection (f) of the definition of Permitted Acquisition; provided,
however, that (1) contemporaneously with the execution of this Agreement,
Borrower delivers, or causes to be delivered, to Administrative Agent, a Joinder
Agreement executed by Nexus Energy Software, Inc. in the form attached hereto as
Exhibit A (the "Nexus Joinder") and (2) within ten (10) Business Days following
the closing date of the Hexagram Acquisition, Borrower agrees to deliver, or
cause to be delivered, to Administrative Agent, a Joinder Agreement executed by
Hexagram, Inc. in the form attached hereto as Exhibit B (the "Hexagram
Joinder"). Borrower further agrees to deliver, or cause to be delivered, any and
all other documentation, including, without limitation, certified corporate
documents, resolutions and legal opinions, as Administrative Agent may
reasonably require in connection with the Nexus Joinder and the Hexagram
Joinder, all of which must be in form and substance reasonably satisfactory to
Administrative Agent. Borrower further acknowledges and agrees that Hexagram,
Inc. and Nexus Energy Software, Inc. will each become a "Domestic Subsidiary"
and "Material Subsidiary" as such terms are defined in the Credit Agreement, and
it will cause such Subsidiaries to execute any and all such documents
(including, without limitation, the Joinder Agreements described above), as are
required pursuant to Section 5.17 of the Credit Agreement. The consent and
waiver granted herein constitute the consent and waiver of Administrative Agent
and Lenders only for the specific purposes herein described and upon the terms
and conditions set forth herein and shall not be deemed a consent to or waiver
of Section 5.14 or any other provisions of the Credit Agreement for any other
Acquisition, transaction or purpose prohibited by the terms of the Credit
Agreement or any other Loan Document.
2. Representations and Warranties of Borrower. Borrower hereby represents and
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warrants to Administrative Agent and Lenders that (i) Borrower's execution,
delivery and performance of this Agreement has been duly authorized by all
requisite action of Borrower, (ii) no consents are necessary from any third
parties for Borrower's execution, delivery or performance of this Agreement,
(iii) this Agreement, the Credit Agreement, and each of the other Loan
Documents, constitute the legal, valid and binding obligations of Borrower
enforceable against Borrower in accordance with their terms, except to the
extent that the enforceability thereof against Borrower may be limited by
bankruptcy, insolvency or other laws affecting the enforceability of creditors
rights generally or by equity principles of general application, (iv) all of the
representations and warranties contained in Article IV of the Credit Agreement
are true and correct with the same force and effect as if made on and as of the
date of this Agreement, (v) after giving effect to this Agreement, there is no
Event of Default, (vi) since the Effective Date, there has been no change or
modification to the organizational documents of Borrower, any Borrowing
Subsidiary or any Guarantor Subsidiary, (vii) since the Effective Date, there
has been no change in the financial condition or business operations of
Borrower, any Borrowing Subsidiary or any Guarantor Subsidiary which could
reasonably be expected to result in a Material Adverse Effect, (viii) there are
no proceedings of any kind, pending or threatened against Borrower, any
Borrowing Subsidiary or any Guarantor Subsidiary, which could reasonably be
expected to result in a Material Adverse Effect, and( ix) there are no Liens
with respect to Borrower or its Subsidiaries or any of their respective assets,
except for those Liens permitted by Section 5.11 of the Credit Agreement.
3. Reaffirmation. Borrower hereby represents, warrants, acknowledges and
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confirms that (i) the Credit Agreement and the other Loan Documents remain in
full force and effect, (ii) Borrower has no defenses to its obligations under
the Credit Agreement and the other Loan Documents, and (iii) Borrower has no
claim against Administrative Agent or any Lender arising from or in connection
with the Credit Agreement or the other Loan Documents and any such claim is
hereby irrevocably waived and released and discharged forever.
4. Definitions. All references in the Credit Agreement to "this Agreement" and
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any other references of similar import shall henceforth mean the Credit
Agreement as amended by this Agreement.
5. Effectiveness of Agreement. This Agreement shall become effective, unless
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otherwise stated herein, as of the date first written above, but only if this
Agreement has been executed by Borrower, Administrative Agent and Lenders and
acknowledged by each Guarantor.
6. Governing Law. This Agreement shall be governed by and construed under the
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laws of the State of Missouri without giving effect to choice or conflicts of
law principles thereunder.
7. Section Titles. The section titles in this Agreement are for convenience of
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reference only and shall not be construed so as to modify any provisions of this
Agreement.
8. Counterparts; Facsimile Transmissions. This Agreement may be executed in one
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or more counterparts and on separate counterparts, each of which shall be deemed
an original, but all of which together shall constitute one and the same
instrument. Signatures to this Agreement may be given by facsimile or other
electronic transmission, and such signatures shall be fully binding on the party
sending the same.
9. Incorporation By Reference. Administrative Agent, Lenders and Borrower hereby
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agree that all of the terms of the Loan Documents are incorporated in and made a
part of this Agreement by this reference.
10. Fees and Expenses. Borrower shall promptly pay to Administrative Agent all
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fees, expenses and other amounts owing to Administrative Agent under the Credit
Agreement and the other Loan Documents, including, without limitation, all fees,
costs and expenses incurred by Administrative Agent in connection with the
preparation, negotiation, execution, and delivery of this Agreement.
11. No Oral Agreements; Entire Agreement. This notice is provided pursuant to
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Section 432.047 X.X.Xx. As used herein, "creditor" means Administrative Agent
and Lenders and "this writing" means this Agreement, the Credit Agreement, and
the other Loan Documents. ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND
CREDIT OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO
EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE, REGARDLESS OF THE LEGAL THEORY
UPON WHICH IT IS BASED THAT IS IN ANY WAY RELATED TO THIS AGREEMENT. TO PROTECT
YOU (BORROWER(S)) AND US (CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY
AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH
IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS
WE MAY LATER AGREE IN WRITING TO MODIFY IT.
12. Patriot Act Notice. Administrative Agent and each Lender hereby notifies the
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Borrower and each Guarantor that, pursuant to the requirements of the USA
Patriot Act, Title III of Pub. L. 107-56, signed into law October 26, 2001 (the
"Act"), it is required to obtain, verify and record information that identifies
the Borrower and each Guarantor, which information includes the name and address
of the Borrower and each Guarantor and other information that will allow
Administrative Agent or such Lender, as applicable, to identify the Borrower and
each Guarantor in accordance with the Act.
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IN WITNESS WHEREOF, this Agreement has been duly executed as of the date first
above written.
ESCO TECHNOLOGIES, INC., a Missouri corporation, as Borrower
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Administrative Agent and a Lender
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: Vice President
BANK OF AMERICA, N.A., Lender
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President
LASALLE BANK NATIONAL ASSOCIATION, Lender
By: /s/ Xxxxxxxx Xxxxx
Name: Xxxxxxxx Xxxxx
Title: Commercial Banking Officer
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, Lender
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx
Name: Xxxxxxxxxxx Xxxxxxxx
Title: Vice President
COMMERCE BANK, N.A., Lender
By: /s/ Xxxx Xxxxxx
Name: Xxxx Xxxxxx
Title: Vice President
THE NORTHERN TRUST COMPANY, Lender
By: /s/ Xxxxx Xxxxxxxx
Name: Xxxxx Xxxxxxxx
Title: Vice President
Acknowledged and Agreed to as of __________________, 2006.
COMTRAK TECHNOLOGIES, L.L.C., a Missouri limited liability company
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
DISTRIBUTION CONTROL SYSTEMS, INC., a Missouri corporation
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
ETS-XXXXXXXX X.X., a Texas limited partnership
By: RANTEC COMMERCIAL, INC.
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
ESCO TECHNOLOGIES HOLDING INC., a Delaware corporation
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
FILTERTEK INC., a Delaware corporation
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
XXXXXXXX, INC., a Delaware corporation
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
XXXXXXXX X.X. ENCLOSURES, INC., an Illinois corporation
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
PTI TECHNOLOGIES INC., a Delaware corporation
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
RANTEC HOLDINGS, INC., a Missouri corporation
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
RANTEC COMMERCIAL, INC., a California corporation
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
VACCO INDUSTRIES, a California corporation
By: /s/ X.X. Xxxxxx, Xx.
Name:
Title:
Exhibit A
JOINDER AGREEMENT
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THIS JOINDER AGREEMENT (the "Agreement"), dated as of January 20, 2006, is
by and between NEXUS ENERGY SOFTWARE, INC., a Massachusetts corporation (the
"Subsidiary"), and XXXXX FARGO BANK, NATIONAL ASSOCIATION, in its capacity as
Administrative Agent under that certain Credit Agreement dated as of October 6,
2004, among ESCO Technologies, Inc., a Missouri corporation (the "Borrower"),
the Lenders identified therein and Xxxxx Fargo Bank, National Association, as
Administrative Agent (as the same may from time to time be amended, modified,
extended, renewed or restated, the "Credit Agreement"). All of the defined terms
in the Credit Agreement are incorporated herein by reference.
Reference is further made to that certain Continuing Guaranty dated as of
October 6, 2004 by and among Comtrak Technologies, L.L.C., Distribution Control
Systems, Inc., ETS-Xxxxxxxx X.X., ESCO Technologies Holding Inc., Filtertek
Inc., Xxxxxxxx, Inc., Xxxxxxxx X.X. Enclosures, Inc., PTI Technologies Inc.,
Rantec Holdings, Inc., Rantec Commercial, Inc., and Vacco Industries, as
Guarantors, in favor of Administrative Agent and Lenders (as the same may from
time to time be amended, modified, extended, renewed or restated, the
"Guaranty").
The Borrower is required by Section 5.17 of the Credit Agreement to cause
the Subsidiary to guaranty the payment and performance of all of the
Obligations.
Accordingly, the Subsidiary hereby agrees with the Administrative Agent,
for the benefit of the Lenders as follows:
1. The Subsidiary hereby acknowledges, agrees and confirms that, by its
execution of this Agreement, the Subsidiary will be deemed to be a party to the
Guaranty and a "Guarantor" for all purposes of the Guaranty, and shall have all
of the obligations of a Guarantor thereunder as if it had executed the Guaranty.
The Subsidiary hereby ratifies, as of the date hereof, and agrees to be bound
by, all of the terms, provisions and conditions applicable to the Guarantors
contained in the Guaranty. Without limiting the generality of the foregoing
terms, the Subsidiary hereby absolutely and unconditionally jointly and
severally guarantees to each Lender, the Swing Line Lender, the Offshore
Currency Fronting Lender, the Letter of Credit Issuer and the Administrative
Agent the prompt and complete payment when due in accordance with their
respective terms (whether by reason of demand, maturity, acceleration or
otherwise) of any and all of the Obligations (whether heretofore, now or
hereafter made, incurred or created, whether voluntary or involuntary and
however arising, absolute or contingent, liquidated or unliquidated, determined
or undetermined, whether the Borrower or any Borrowing Subsidiary may be liable
individually or jointly with others and whether recovery upon such Obligations
may be or hereafter becomes unenforceable) in accordance with the terms and
conditions hereof. In addition, the Subsidiary shall and agrees to be jointly
and severally liable to each Lender, the Swing Line Lender, the Offshore
Currency Fronting Lender, the Letter of Credit Issuer and the Administrative
Agent for all costs and expenses incurred by such Person in attempting or
effecting collection under the Guaranty (whether or not litigation shall be
commenced in aid thereof) and in connection with representation of such Person
in connection with bankruptcy or insolvency proceedings relating to or affecting
the Guaranty, including, without limitation, reasonable attorneys' fees and
expenses.
2. This Agreement may be executed in two or more counterparts, each of
which shall constitute an original but all of which when taken together shall
constitute one contract.
3. This Agreement shall be governed by and construed and interpreted in
accordance with the laws of the State of Missouri.
IN WITNESS WHEREOF, the Subsidiary has caused this Joinder Agreement to be
duly executed by its authorized officers, and the Administrative Agent, for the
benefit of the Lenders, has caused the same to be accepted by its authorized
officer, as of the day and year first above written.
NEXUS ENERGY SOFTWARE, INC.
By: s/ X. X. Xxxxxx
Name: X. X. Xxxxxx
Title: Chairman and CEO
Acknowledged and accepted:
XXXXX FARGO BANK,
NATIONAL ASSOCIATION
as Administrative Agent
By: s/Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: Vice President
Exhibit B
SECRETARY'S CERTIFICATE
OF
NEXUS ENERGY SOFTWARE, INC.
I am Secretary of Nexus Energy Software, Inc., a Massachusetts corporation
(the "Company"), and do hereby certify further that:
1. Attached hereto as Exhibit A is a true and complete copy of the Articles
of Organization of the Company certified by the Secretary of the Commonwealth of
Massachusetts and in effect on this date.
2. Attached hereto as Exhibit B is a true and complete copy of the By-Laws
of the Company as in effect on this date.
3. Each persons named in Exhibit C hereto is a duly elected, qualified and
acting officer or authorized signatory of the Company, holding the office in the
Company set forth opposite his or her name on such Exhibit, and set forth
opposite his or her name on such Exhibit is the genuine signature of such person
or a true facsimile of such genuine signature.
4. No further amendment to the Articles of Incorporation of the Company has
been approved by its Board of Directors or stockholders or has been filed with
the Secretary of the Commonwealth of Massachusetts.
5. The Company is in good standing as a corporation under the laws of the
Commonwealth of Massachusetts, no proceeding has been commenced or to the best
of my knowledge is contemplated for the dissolution or liquidation of the
Company.
6. Attached hereto as Exhibit D is a true and complete copy of resolutions
duly adopted by unanimous written consent of the Board of Directors of the
Company authorizing the transactions contemplated therein, which resolutions
have not been amended and are in full force and effect on this date.
IN WITNESS WHEREOF, the undersigned has caused this Certificate of
Secretary to be executed on January 20, 2006.
(Seal) s/Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx, Secretary
I am Vice President of the Company. I hereby certify that on the date of
the Certificate set forth above Xxxxxx X. Xxxxxxx is the duly elected, qualified
and acting Secretary of the Company and that the signature set forth above is
his genuine signature.
s/X. X. Xxxxxx
X. X. Xxxxxx, ____________
