DONALDSON Co INC 8-K

What Happened

• On April 8, 2026, Donaldson Company, Inc. announced it entered into a Term Loan Credit Agreement providing a new three-year committed, unsecured, delayed-draw term loan facility of $400 million. Wells Fargo Bank, N.A. is the administrative agent and Wells Fargo and U.S. Bank are joint lead arrangers. No amounts were outstanding under the facility as of April 8, 2026.
• Borrowings may be denominated in U.S. dollars and bear interest either at Term SOFR plus an applicable margin (with a zero floor on SOFR) or at a Base Rate plus the applicable margin. The applicable margin (the “Applicable Rate”) is determined by Donaldson’s debt-to-EBITDA ratio.

Key Details

• Facility size: $400 million, three-year committed, unsecured, delayed-draw term loan.
• Effective date: April 8, 2026; no borrowings outstanding as of that date.
• Interest: Term SOFR + Applicable Rate (SOFR floored at 0%) or Base Rate + Applicable Rate; Applicable Rate set by debt-to-EBITDA.
• Financial covenants: consolidated interest coverage ratio ≥ 3.5x and adjusted debt-to-EBITDA ≤ 3.5x (temporary increase permitted for a Material Acquisition).
• Remedies: Lenders may terminate commitments or accelerate amounts upon defaults (including payment defaults, covenant breaches, bankruptcy).
• Banking relationships: Wells Fargo and U.S. Bank and other lenders provide routine banking services to Donaldson.

Why It Matters

• This agreement gives Donaldson immediate access to up to $400M of committed liquidity (if drawn), improving financing flexibility for working capital, capital spending, or acquisitions without issuing secured debt.
• The covenants tie pricing and availability to Donaldson’s leverage and interest coverage; failure to meet them could lead to termination or acceleration of loans. Investors should watch future draws under the facility, changes in leverage (debt-to-EBITDA), interest costs tied to SOFR or base rates, and any announced uses of proceeds.