TWIN DISC INC 8-K

What Happened

• Twin Disc, Incorporated announced on June 30, 2026 that it entered into a Credit Agreement with Bank of Montreal and JPMorgan Chase (the Lenders), with Kobelt Manufacturing Co. Ltd. as guarantor. The agreement refinances the prior credit facility dated February 14, 2025.
• The Lenders provided $30,000,000 in Term Loans and a Revolving Credit Commitment of up to $60,000,000 (including a $5,000,000 swing line sublimit and a $4,000,000 letters-of-credit sublimit). The Term Loans mature June 30, 2031.

Key Details

• Repayment schedule: minimum principal installments of $375,000 per quarter, increasing to $562,500 per quarter starting ~Sept 30, 2028 and $750,000 per quarter starting ~Sept 30, 2030.
• Interest: loans priced off SOFR, EURIBOR, CORRA or a Base Rate with an Applicable Margin of 1.50%–3.00% (margin and unused-commitment fee of 0.15%–0.30% vary by Total Funded Debt/EBITDA ratio). The Term Loan is a SOFR loan.
• Security: borrowings are secured by substantially all personal property of Twin Disc and Kobelt (accounts receivable, inventory, machinery/equipment, IP) and a 65% pledge of equity in certain foreign subsidiaries; related amended security and pledge agreements were executed.
• Events of default allow the Administrative Agent to terminate commitments, accelerate repayment, and require 105% cash collateralization of outstanding letters of credit; bankruptcy can accelerate remedies without notice.

Why It Matters

• This agreement secures Twin Disc’s near- to mid-term financing capacity: $30M of term debt plus up to $60M in revolver availability, which supports liquidity and working-capital needs. The loan terms, interest tied to market rates (SOFR/CORRA/EURIBOR), and collateral requirements are material for creditors and equity investors because they affect leverage, cash flow demands (scheduled principal paydowns), and the company’s flexibility.