KEWAUNEE SCIENTIFIC CORP /DE/KEQU
KEWAUNEE SCIENTIFIC CORP /DE/ Debt Disclosure
Long-term Debt and Other Credit Arrangements
The components of the Company's long-term debt, excluding lease, deferred financing costs of $0.4 million and $0.8 million related to the debt, and sale-leaseback related activity, as presented on the Consolidated Balance Sheet as of April 30, 2026 and 2025, respectively, were as follows:
| ($ in thousands) | April 30, 2026 | April 30, 2025 | |||||||||
| Seller Notes | $ | — | $ | 23,935 | |||||||
| Term Loan | 10,750 | 13,750 | |||||||||
| First Amendment Term Loan | 9,333 | — | |||||||||
| Total outstanding balance under Amended Loan Agreement | 20,083 | 13,750 | |||||||||
| Total long-term debt | $ | 20,083 | $ | 37,685 | |||||||
| Current portion of Term Loan | $ | 3,000 | $ | 3,000 | |||||||
| Current portion of First Amendment Term Loan | 2,000 | — | |||||||||
| Current portion of Amended Loan Agreement balance | 5,000 | 3,000 | |||||||||
| Total current portion of long-term debt | 5,000 | 3,000 | |||||||||
| Seller Notes | — | 23,935 | |||||||||
| Non-current portion of Term Loan | 7,750 | 10,750 | |||||||||
| Non-current portion of First Amendment Term Loan | 7,333 | — | |||||||||
| Non-current portion of Amended Loan Agreement balance | 15,083 | 10,750 | |||||||||
| Total non-current portion of long-term debt | 15,083 | 34,685 | |||||||||
| Total long-term debt | $ | 20,083 | $ | 37,685 | |||||||
See Note 12, Leases, Commitments and Contingencies, for more information on any long-term debt related to the Company's lease portfolio and Note 7, Sale-Leaseback Financing Transaction, for more information on any long-term debt related to the Company's sale-leaseback financing transaction.
PNC Loan Agreement
As noted in Note 4, Nu Aire Acquisition, the Company entered into a Loan Agreement (the "Loan Agreement") with PNC on November 1, 2024. The loans governed by the Loan Agreement include (i) a $20.0 million committed senior secured revolving line of credit facility (the "Revolving Credit Facility"), which contains an option to increase the facility upon request by the Company and approval by PNC, in its discretion, by an additional $10.0 million; and (ii) a $15.0 million term loan (the "Term Loan"). The Revolving Credit Facility and Term Loan mature on November 1, 2029.
On December 4, 2025, the Company entered into a First Amendment to Loan Agreement ("First Amendment") with PNC. The First Amendment amends the Loan Agreement (together with the "First Amendment," the "Amended Loan Agreement") between the Company and PNC to, among other things, (i) permit the Company to repay in full the outstanding principal balances of the subordinated seller notes issued by the Company in connection with its acquisition of Nu Aire in November 2024, together with all accrued but unpaid interest thereon (the "Seller Note Repayment"), (ii) provide for an additional $10.0 million term loan the proceeds of which are to be used by the Company to partially fund the Seller Note Repayment (the "First Amendment Term Loan" and together with the Term Loan, the "Term Loans"), and (iii) permit the Company to draw and use available funds under the revolving line of credit established by the Loan Agreement to partially fund the Seller Note Repayment. The First Amendment Term Loan matures on December 4, 2030.
The Revolving Credit Facility and the Term Loan can be paid at any time without penalty.
At April 30, 2026 and 2025, no advances were outstanding under the Revolving Credit Facility, respectively. Amounts available under the Revolving Credit Facility were $20,000,000 at April 30, 2026 and 2025, respectively.
For the Revolving Credit Facility, the interest rate will be selected by the Company at each advance from one of two options. Option 1 is a base rate option. Option 2 is a daily secured overnight financing rate. There is an unused fee of 0.15% to 0.25%, determined by the ratio of senior debt to the Company's EBITDA, of the unused daily balance of the Revolving Credit Facility. For the Term Loan, the principal will be paid in 60 substantially equal monthly installments over the term of the Loan Agreement. For the First Amendment, the principal will be paid in 59 substantially equal monthly installments over the term of the agreement. Interest will be paid at the same time and calculated on the outstanding principal balance at an interest rate equal to the rate under Option 2 of the Revolving Credit Facility. The borrowing rate on the Term Loans was 5.27% as of April 30, 2026, compared to 5.96% as of April 30, 2025. The Company recorded interest expense of $904,000 and $486,000 related to the Term Loans for the fiscal year ending April 30, 2026 and 2025, respectively.
The Amended Loan Agreement has customary reporting covenants. The principal financial covenants require that (1) the Company maintain on a consolidated basis a ratio of senior funded indebtedness to EBITDA of not more than 2.50 to 1.00 and (2) a fixed charge coverage ratio of at least 1.20 to 1.00. The Loan Agreement also contains covenants prohibiting under certain circumstances (1) the incurrence of certain indebtedness, (2) the granting of security interests by the Company to persons other than PNC, (3) the delivery of guaranties for debts of third parties, and (4) certain transactions not in the ordinary course of business. At April 30, 2026 and 2025, the Company was in compliance with all of the financial covenants under the Loan Agreement.
Future minimum payments under the Amended Loan Agreement for the fiscal years ending April 30 are as follows:
| ($ in thousands) | ||||||||
| 2027 | $ | 5,000 | ||||||
| 2028 | 5,000 | |||||||
| 2029 | 5,000 | |||||||
| 2030 | 3,750 | |||||||
| 2031 | 1,333 | |||||||
| Thereafter | — | |||||||
Total | $ | 20,083 | ||||||
Seller Notes
As noted in Note 4, Nu Aire Acquisition, $23.0 million of the aggregate purchase price paid in the Nu Aire Acquisition was paid by the issuance of subordinated seller notes (the "Seller Notes") entered into by the Company on November 1, 2024. The Seller Notes accrued interest at 8% per annum and were scheduled to mature on November 1, 2027, at which time the outstanding principal amount and all unpaid accrued interest were to become due and payable by the Company.
On December 4, 2025, the Company completed the Seller Note Repayment. Pursuant to the terms of the Seller Notes, the Seller Notes could be prepaid, in full or in part, at any time without prepayment penalty, premium, or other fee. Upon completion of the Seller Note Repayment, all obligations, covenants, debts and liabilities of the Company under the Seller Notes were satisfied and discharged in full, and the Seller Notes and all other documents entered into in connection with the Seller Notes were terminated.
Prior to the Seller Note Repayment, the Company accrued $905,000 in PIK interest for the six month period ended October 31, 2025 and $935,000 for the fiscal year ended April 30, 2025. The Company made a payment of $1,840,000 during the period ended October 31, 2025 for its accrued PIK interest, resulting in a PIK interest balance of zero as of October 31, 2025. As part of the Seller Note Repayment, the Company repaid the outstanding Seller Notes balance of $23.0 million and accrued but unpaid interest balance of $173,000. The Company incurred $0.3 million in related expenses as a result of the Seller Note Repayment.
Mid Cap Revolving Credit Facility
On December 19, 2022, the Company entered into a Credit and Security Agreement (the "Credit Agreement") with Mid Cap Funding IV Trust, as agent (the "Agent"), and the lenders from time to time party thereto (collectively, the "Lenders"). The Credit Agreement provided for a secured revolving line of credit initially up to $15.0 million (the "Mid Cap Revolving Credit Facility"). Availability under the Mid Cap Revolving Credit Facility was subject to a borrowing base calculated in accordance with the terms of the Credit Agreement and on the basis of eligible accounts and inventory and certain other reserves and adjustments. Pursuant to the Credit Agreement, the Company granted to the Agent, for itself and the Lenders, a first priority security interest in all existing and future acquired assets owned by the Company. Except as set forth in the Credit Agreement, borrowings under the Mid Cap Revolving Credit Facility bore interest at a rate equal to Term SOFR (Secured Overnight Financing Rate) plus 4.10%. The Company was required to make monthly interest payments on the Mid Cap Revolving Credit Facility, with the entire principal payment due at maturity.
On September 30, 2024, the Company terminated the Mid Cap Revolving Credit Facility. At the time of termination, there was a $3.0 million balance outstanding under the Mid Cap Revolving Credit Facility, which was paid off in full as part of termination. The Company incurred $0.5 million in related expenses as a result of the termination.
International Subsidiaries Short-Term Borrowings
The Company's international subsidiaries had a balance outstanding of $74,000 and $986,000 in short-term borrowings related to overdraft protection and short-term loan arrangements at April 30, 2026 and 2025, respectively.
At April 30, 2026, there were foreign bank guarantees outstanding to customers in the amounts of $7.1 million, $466,000, $696,000, and $328,000 with expiration dates in fiscal years 2027, 2028, 2029, and 2030, respectively, collateralized by certain
assets of the Company's subsidiaries in India. At April 30, 2025, there were bank guarantees issued by foreign banks outstanding to customers in the amounts of $8.1 million, $1.2 million, $450,000, and $653,000 with expiration dates in fiscal years 2026, 2027, 2028 and 2029, respectively, collateralized by certain assets of the Company's subsidiaries in India.
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | Jun 26, 2026 | Showing above |
| 2025 | Jul 2, 2025 | |
| 2024 | Jun 28, 2024 | |
| 2023 | Jun 30, 2023 | |
| 2022 | Jul 1, 2022 | |
| 2021 | Jul 15, 2021 | |
| 2020 | Jul 27, 2020 | |
| 2019 | Jul 11, 2019 | |
| 2018 | Jul 20, 2018 | |
| 2017 | Jul 21, 2017 | |
| 2016 | Jul 21, 2016 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.