UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
February 10, 2006
Date of Report (Date of earliest
event reported)
ESTERLINE TECHNOLOGIES CORPORATION
(Exact Name of Registrant as Specified in Charter)
| |
|
|
|
|
| Delaware
|
|
001-06357
|
|
13-2595091 |
|
|
|
|
|
(State or Other Jurisdiction
of Incorporation)
|
|
(Commission File No.)
|
|
(IRS Employer
Identification No.) |
| |
|
|
500-108th Avenue NE, Bellevue, Washington 98004
|
| (Address of principal executive offices)
|
|
(Zip Code) |
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:
| |
o |
|
Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| |
| |
o |
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| |
| |
o |
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| |
| |
o |
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| |
|
|
Item 1.01
|
|
Entry into a Material Definitive Agreement. |
On February 10, 2006, Esterline Technologies Corporation, a Delaware corporation (the
“Company”), entered into Amendment No. 4 to Credit Agreement (the “Fourth Amendment”) by and among
the Company, various financial institutions (collectively, the “Lenders”) and Wachovia Bank,
National Association (“Wachovia”), as Administrative Agent. The Fourth Amendment amends certain
terms of the Credit Agreement (the “Credit Agreement”) dated as of June 11, 2003, as amended, by
and between the Company, the financial institutions referred to therein and Wachovia, as
Administrative and Collateral Agent.
Among other things, the Fourth Amendment amends the Credit Agreement by including a $100
million term loan facility. In addition, under the Fourth Amendment, borrowings (i) under the term
loan facility, (ii) up to $25 million under the $100 million revolving credit facility and (iii)
pursuant to letters of credit up to the $50 million letter of credit sublimit may be in euros or
British Pounds Sterling in addition to U.S. dollars. The Company may prepay (subject to customary
breakfunding costs) in whole or in part, subject to certain minimum prepayment amounts, advances
under the revolving credit facility, term loan facility or pursuant to a letter of credit
denominated in foreign currencies upon four business days’ notice to the Administrative Agent.
On February 10, 2006 the Company borrowed £57.0 million, or approximately $100 million, under
the term loan facility. The Company expects to use the proceeds from the loan as working capital
for its U.K. operations and to repay a portion of its outstanding borrowings under the revolving
credit facility. The principal amount of the loan is payable quarterly commencing on March 31,
2007 through the termination date of November 14, 2010 according to a payment schedule pursuant to
which 1.25% of the principal amount is paid in each quarter during 2007, 2.50% in each quarter
during 2008, 5.00% in each quarter during 2009 and 16.25% in each quarter during 2010. Under the
Fourth Amendment, the loan accrues interest at the one-month, two-month, three-month or six-month
rate per annum, as selected at the option of the Company, based on the British Bankers Association
Interest Settlement Rate for deposits in British Pounds Sterling plus an additional margin amount
that ranges from 1.125% to 0.500% depending upon the Company’s leverage ratio. As of February 10,
2006, the initial interest rate on the term loan was 5.33%, which was determined applying the
one-month British Pounds Sterling deposit rate and the Company’s leverage ratio as of February 10,
2006, and is payable on March 1, 2006. Thereafter, interest on the term loan will be payable
monthly. In connection with the funding of the term loan, the Company entered into an interest rate swap agreement on the full
principal amount and for the term of the loan pursuant to which the variable interest rate was
exchanged for a fixed interest rate of 4.755% plus an additional margin amount determined under the
Fourth Amendment depending on the Company’s leverage ratio.
The Fourth Amendment also incorporates other definitional revisions. The Company and certain
of its subsidiaries, which are guarantors, are obligated to repay all amounts (plus
-1-
interest and expenses) borrowed under Fourth Amendment, including the advance under the term
loan facility described above. In addition, the collateral granted by the Company to the Lenders
pursuant to the Credit Agreement also secures the Company’s obligations under the Fourth Amendment.
Other than the Credit Agreement and the amendments thereto, the Company does not have any
material relationship with the Lenders, nor is the Company aware of any material relationship
existing between any of its affiliates and the Lenders.
The foregoing summary of the Fourth Amendment is qualified in its entirety by the terms of the
Fourth Amendment, which is attached hereto as Exhibit 10.2 and incorporated herein by reference.
| |
|
|
Item 2.03
|
|
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information required by this item is included in Item 1.01 and is incorporated herein by
reference.
| |
|
|
Item 9.01
|
|
Financial Statements and Exhibits. |
(d) Exhibits.
| |
|
|
| Exhibit No. |
|
Description |
|
|
|
10.2
|
|
Amendment No. 4 to Credit Agreement dated as of February 10, 2006 by and among Esterline
Technologies Corporation, the financial institutions identified therein and Wachovia Bank,
National Association, as Administrative Agent. |
-2-