ENPRO INDUSTRIES, INC: conclusion of a material definitive agreement, completion of the acquisition or disposal of assets, creation of a direct financial obligation or obligation under an off-balance sheet arrangement of a holder , financial statements and exhibits (Form 8-K)

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Item 1.01 Conclusion of a Material Definitive Agreement

At December 17, 2021, EnPro Industries, Inc. (the “Company”) entered into a third amended and restated credit agreement (the “Amended Credit Agreement”) dated December 17, 2021 between the Company and EnPro Holdings, Inc., a wholly owned subsidiary of the Company (“EnPro Fund“), as borrowers, certain foreign subsidiaries of the Company from time to time parties to it, as named borrowers, guarantors party to it, lenders party to it and Bank of America, NA., as administrative agent, Swing Line lender and L / C transmitter. The Amended Credit Agreement amends, restates and replaces the Second Amended and Restated Credit Agreement dated June 28, 2018, as amended, between the Company and EnPro Fund as borrowers, party guarantors, party lenders and Bank of America, NA., as administrative agent, Swing Line lender and L / C transmitter.

The amended credit agreement provides for credit facilities in an initial aggregate principal amount of $ 1,007.5 million, consisting of (1) a senior secured revolving credit facility with a term of five years of $ 400.0 million (the “Revolving Credit Facility”), (2) a $ 142.5 million senior secured term loan facility to replace the Company’s existing senior secured term loan facility, maturing September 25, 2024 (the “A-1 Term Loan Facility”), (3) a five-year senior secured term loan facility of $ 315 million (the “A-2 Term Loan Facility”) and (4) a 364-day senior secured term loan facility of $ 150 million (the “364 Day Facility” and, together with the Revolving Credit Facility, the A-1 Term Loan Facility and the A-2 Term Loan Facility, the “Facilities”). The amended credit agreement also provides that borrowers may apply for additional term loans and / or additional revolving credit commitments in an amount equal to the greater of the following amounts: $ 275.0 million and 100% of Consolidated EBITDA for the most recent completed four-quarter period for which the Company reported financial results, plus additional amounts based on a senior consolidated leverage ratio. The amended credit agreement entered into force on December 17, 2021.

Initially, borrowings under the facilities (other than the 364 day facility) bear interest at the annual LIBOR rate plus 1.75% or the prime rate plus 0.75%, although such interest rates are subject to to a gradual increase or decrease based on a total net consolidated leverage ratio. Borrowings under the 364 day facility bear interest at the annual LIBOR rate plus 1.50% or the prime rate plus 0.50%. In addition, a commitment fee accumulates on the unused amount of the revolving credit facility at an annual rate of 0.225%, which rate is also subject to a gradual increase or decrease based on a ratio of consolidated net leverage. The amended credit agreement contains the usual replacement provisions for LIBOR.

The A-1 term loan facility will be amortized on a quarterly basis for an annual amount equal to 2.5% of the initial principal of the A-1 term loan facility ($ 150.0 million) during the first year after closing, 5.0% of this initial capital in the second year and 1.25% of this initial capital during each of the first three quarters of the third year, the outstanding capital being payable at the due date. The A-2 term loan facility will amortize quarterly at an annual amount equal to 2.5% of the original principal amount of the A-2 term loan facility in each of years one to three. 5.0 % of this initial capital in the fourth year and 1.25% of this initial capital during each of the first three quarters of the fifth year, the balance of the outstanding capital being payable at maturity. The 364 day facility will not be amortized and will be payable in full at maturity. The facilities are subject to prepayment with the net cash proceeds of certain asset sales, accident or conviction events and unauthorized debt issuances.

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The Company and EnPro Fund are the borrowers authorized under the facilities. The Company may also, from time to time, name one of its foreign wholly owned subsidiaries as the borrower under the Revolving Credit Facility. Each of the Company’s domestic subsidiaries (other than those subsidiaries which may be designated as “unrestricted” by the Company from time to time, and inactive subsidiaries) is required to guarantee the obligations of borrowers under the Facilities, and each of the subsidiaries The Company’s existing domestic subsidiaries (other than inactive subsidiaries) have entered into the amended credit agreement to provide such collateral.

Borrowings under the Facilities are guaranteed by a priority pledge of the following assets:

• 100% of the share capital of each national subsidiary of the Company (other

as unrestricted or inactive subsidiaries);

• 65% of the share capital of any first tier foreign affiliate of the Company

   and its domestic subsidiaries (other than unrestricted or inactive
   subsidiaries); and


• substantially all of the assets (including, without limitation, machinery and

   equipment, inventory and other goods, accounts receivable, bank accounts,
   general intangibles, financial assets, investment property, license rights,
   patents, trademarks, trade names, copyrights, chattel paper, insurance
   proceeds, contract rights, hedge agreements, documents, instruments,
   indemnification rights, tax refunds and cash, but excluding real estate
   interests) of the Company and its domestic subsidiaries (other than
   unrestricted or inactive subsidiaries).


The amended credit agreement contains certain financial covenants and required financial ratios, including:

• a maximum total consolidated net leverage ratio not exceeding 4.75 to 1.0

   (with total debt, for the purposes of such ratio, to be net of up to $150
   million of unrestricted cash of the Company and its consolidated subsidiaries),
   which ratio will decrease to 4.5 to 1.0 for each fiscal quarter beginning with
   the first full fiscal quarter ending after the fiscal quarter during which the
   previously announced sale of the Company's CPI business is completed (or the
   definitive agreement therefor expires) and ending with the fiscal quarter
   ending December 31, 2022, and to 4.0 to 1.0 for each fiscal quarter thereafter;
   and, once so decreased to 4.0 to 1.0, may be increased (up to three times) at
   the borrowers' option to not more than 4.5 to 1.0 for the four-quarter period
   following a significant acquisition; and


• a minimum consolidated interest coverage ratio of at least 2.5 to 1.0.

The amended credit agreement contains positive and negative restrictive covenants (subject, in each case, to customary and other exceptions and reservations), including restrictive covenants which limit the ability of the Company and its subsidiaries to, inter alia:

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• grant privileges on assets;

• incur additional debt (including guarantees and other

obligations) ;

• make certain investments (including loans and advances);



 • merge or make other fundamental changes;
. . .


Item 2.01 Completion of Acquisition or Disposal of Assets.

As previously stated, the November 4, 2021, EnPro Fund entered into a purchase and sale contract dated November 4, 2021 (the “Purchase Agreement”) with TCFII NxEdge Holdings, LLC (the “Seller”) and TCFII NxEdge LLC
(“NxEdge”) providing for the sale by the Seller to EnPro Fund of all issued and outstanding participations of NxEdge (the “Purchase Transaction”). The purchase transaction was completed on December 17, 2021 (the “Closing Date”).

The consideration paid by EnPro Fund in the Purchase Transaction is $ 850.0 million in cash, subject to a potential adjustment in accordance with the terms of the Purchase Agreement on the basis of the amount, on the Closing Date, of the cash, debt and working capital of NxEdge, as well as for the amount of selling costs and other specified costs of NxEdge. EnPro Fund used available cash and borrowings under the amended credit agreement to fund payment of purchase consideration.

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NxEdge is a leading semiconductor value chain manufacturing, cleaning, coating and remanufacturing company with six main facilities located in Idaho and California. At the closing of the purchase transaction,
NxEdge has been included in the Advanced Surface Technologies (AST) segment of the Company.

The foregoing description of the purchase contract does not purport to be complete and is qualified in its entirety by reference to the full text of the purchase contract, which has been filed as Exhibit 10.1 of the company’s current report on Form 8 -K filed on November 5, 2021 and is incorporated herein by reference.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under a

Off-balance sheet disposition of a registrant

The information set forth in Section 1.01 of this current report on Form 8-K is hereby incorporated by reference.

Item 9.01 Financial statements and supporting documents.

(a) Financial statements of acquired businesses

As permitted by Section 9.01 (a) (4) of Form 8-K, the required financial statements will be filed by an amendment of this current report on Form 8-K on or before the date specified by Section 9.01 (a ) (4).

(b) Pro forma financial information

As permitted by sections 9.01 (a) (4) and 9.01 (b) of Form 8-K, the required pro forma financial information will be filed by an amendment of this current report on Form 8-K on or before the date specified by Section 9.01 (a) (4).

(d) Exhibitions

   Exhibit    Purchase and Sale Agreement dated as of November 4, 2021 among TCFII
 2.1          NxEdge Holdings, LLC, TCFII NxEdge LLC and EnPro Holdings, Inc.
              (incorporated by reference to Exhibit 10.1 to the Current Report on
              Form 8­K filed by EnPro Industries, Inc. on November 5, 2021 (File
              No. 001-31225))



   Exhibit   Third Amended and Restated Credit Agreement dated as of December 17,
 10.1        2021 among EnPro Industries, Inc. and EnPro Holdings, Inc., as
             borrowers, certain foreign subsidiaries of EnPro Industries, Inc.
             from time to time party thereto, as designated borrowers, the
             guarantors party thereto, the lenders party thereto and Bank of
             America, N.A., as Administrative Agent, Swing Line Lender and L/C
             Issuer


Exhibit 104 Interactive Cover Page Data File (integrated into online XBRL

             document)



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