BRADY CORP 8-K

What Happened
Brady Corporation (BRC) filed an 8-K on June 18, 2026 reporting that, on June 12, 2026, it and certain subsidiaries entered into a $1.0 billion Credit Agreement to finance the acquisition of its Productivity Solutions and Services (PSS) business. The facility replaces Brady’s prior credit agreement (originally dated August 1, 2019) and was arranged with BMO Bank N.A. as administrative agent and Bank of America, N.A. as syndication agent, among other lenders.

Key Details

• Aggregate commitments: $1.0 billion total — $500 million term loan + $500 million revolving credit facility. Final maturity for both facilities: June 12, 2031.
• Interest and amortization: Borrower may choose a base rate or various term/risk-free benchmark rates plus a margin tied to Brady’s consolidated net leverage; term loan amortizes quarterly at 1.25% of original principal after the PSS closing.
• Revolver features: Multi‑currency borrowings allowed (USD, EUR, GBP, AUD, JPY, CAD); $100 million letter of credit sublimit and $100 million swing‑line sublimit; revolver availability capped at $300 million before the PSS closing and expands to $500 million after closing.
• Covenants and flexibility: Maximum consolidated net leverage of 3.50x (temporarily up to 4.00x for four computation periods after the PSS closing), minimum interest coverage ratio of 3.00x, and an incremental facility feature allowing up to $550 million of additional commitments (plus further amounts subject to a pro forma leverage test).

Why It Matters
This credit agreement secures committed financing for Brady’s PSS acquisition and establishes the company’s near‑term liquidity and borrowing terms through 2031. The agreement’s covenants (leverage and interest coverage) and temporary covenant relief tied to the acquisition will influence Brady’s financial flexibility and repayment capacity. Investors should note the size, amortization schedule, interest rate mechanics, and the pre- vs. post-closing revolver availability when assessing near-term leverage and cash‑flow implications.