The Toro Company (NYSE:TTC) entered into a definitive agreement to acquire The Charles Machine Works, Inc. for $700 million on February 14, 2019. Out of total consideration, Toro will deposit up to $26.13 million with an escrow agent to fund payment obligations with respect to the working capital and other adjustments and potential post-closing indemnification obligations of Charles Machine Works' former shareholders and the remaining balance of consideration will be paid at closing. The consideration will be paid in cash and is subject to certain working capital, net debt and other adjustments. Toro expects to finance the transaction with a combination of cash on hand and debt, including from additional financing arrangements and borrowings under its existing credit facility. Bank of America Merrill Lynch and J.P. Morgan Chase Bank provided committed debt financing to Toro for the transaction. On March 19, 2019, The Toro Company entered into a term loan credit agreement with certain lenders, Bank of America, N.A., as administrative agent and JPMorgan Chase Bank, N.A. and Wells Fargo Bank, National Association, as syndication agents for an aggregate credit commitment of up to $500 million to finance acquisition of The Charles Machine Works, Inc. and for general corporate purposes. The commitment included a $200 million three year unsecured senior term loan maturing on April 1, 2022 and a $300 million five year unsecured senior term loan maturing on April 1, 2024. The remaining balance of the preliminary purchase price was funded through cash proceeds from borrowings on The Toro Company 's unsecured senior revolving credit facility. On completion, Charles Machine Works will operate as a wholly-owned subsidiary of Toro and will continue under the name “The Charles Machine Works, Inc.” The transaction represents a multiple of approximately eight times Charles Machine Works’ calendar year 2018 EBITDA. Charles Machine Works had revenues of $725 million in year 2018. The initial directors and officers of Charles Machine Works shall be the directors and officers of Toro, respectively immediately prior to closing, until their respective successors are duly elected or appointed and qualified. The current Chief Executive Officer, Rick Johnson, will stay on board but he will transition his responsibilities. The transaction is subject to customary closing conditions, including regulatory approvals, the expiration or termination of the applicable waiting period under the Hart Scott Rodino Antitrust Improvements Act of 1976, as amended, and the receipt of all consents, approvals or waivers required under other applicable antitrust laws, approval of shareholders of Charles Machine Works, execution of escrow agreement, Charles Machine Works delivering to Toro the FIRPTA Certificates, and Charles Machine Works delivering to Toro duly executed payoff letters by each holder of any indebtedness that is secured by any encumbrance on any assets of Charles Machine Works. The transaction is not subject to any financing condition. The transaction has been unanimously approved by the Boards of Directors of Toro and also have been approved by Charles Machine Works’ Boards of Directors. The Boards of Directors of Charles Machine Works recommended shareholders to approve the transaction. As of March 1, 2019, the Federal Trade Commission granted early termination notice. As of March 20, 2019, German Federal Cartel Office provided clearance with respect to the transaction and Toro received all necessary regulatory approvals. Transaction is expected to close before the end of Toro’s fiscal 2019 third quarter. As of February 18, 2019, the transaction is expected to close before August 3, 2019. As of March 20, 2019, the transaction is expected to close prior to the end of Toro’s fiscal second quarter. Toro expects the transaction to be immediately accretive to EPS excluding purchase accounting adjustments and transaction related expenses. J.P. Morgan Securities LLC acted as financial advisor while Christopher Lueking of Latham & Watkins LLP and Timothy J. Scallen and Phillip B. Martin of Fox Rothschild LLP acted as legal advisors for Toro. Joshua D. Smith, Danae Grace, Rich Johnson, Brett Merritt, Simon Bright, Eleanor Burg, Chris Coleman, Jennifer Callahan, John Papahronis, Jim Prince, Mike Blake, Steve Cole, Mike LaBrie, Sasha Beling, Justin Jackson, Matt Brown and Derek Hardberger of McAfee & Taft A Professional Corporation acted as legal advisors to Charles Machine Works. The Toro Company (NYSE:TTC) completed the acquisition of The Charles Machine Works, Inc.for approximately $700 million on April 1, 2019. The consideration included cash acquired of $16.34 million and was funded using a combination of proceeds from the term loan credit agreement and revolving credit agreement. On April 1, 2019, The Toro Company borrowed $200 million of available borrowings under its revolving credit agreement dated as of June 19, 2018, with certain lenders in order to fund a portion of the purchase price for the acquisition.