| Item 1.01 |
Entry into a Material Definitive Agreement. |
On January 31, 2026, Donaldson Company, Inc. (the “Company”) entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Facet Group Holdings II LLC, a Delaware limited liability company (“U.S. Seller”), Facet Holdings II B.V., an entity organized and existing under the laws of the Netherlands (“OUS Seller” and, together with U.S. Seller, “Sellers” and each, a “Seller”). Pursuant to the Purchase Agreement, on the terms and subject to the conditions set forth in the Purchase Agreement, (i) the Company will purchase from U.S. Seller all right, title and interest in and to all of the issued and outstanding equity interests (the “U.S. Securities”) of Facet (Oklahoma) LLC, a Delaware limited liability company (“Facet US”) and, immediately following the consummation of the transactions described in the foregoing clause, (ii) the Company will purchase from OUS Seller, all right, title and interest in and to all of the issued and outstanding equity interests (the “International Securities” and together with the U.S. Securities, the “Securities”) of Facet Netherlands B.V., an entity organized and existing under the laws of the Netherlands (“Facet BV” and, together with Facet US, “Facet”).
Pursuant to the terms of the Purchase Agreement, the Company has agreed to pay a purchase price of $820 million in cash, subject to customary adjustments set forth in the Purchase Agreement for Facet’s cash, debt, transaction expenses and net working capital.
The consummation of the Transactions is subject to the satisfaction or waiver of certain customary closing conditions, including, among other things, (i) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended; (ii) applicable foreign direct investment flings in non-U.S. countries; (iii) the absence of any applicable law enacted after the date of the Purchase Agreement or order that prohibits, restrains or enjoins the consummation of the Transactions; (iv) the accuracy of the representations and warranties of the parties to the Purchase Agreement (subject to specified materiality standards set forth in the Purchase Agreement); (v) compliance by each of the parties to the Purchase Agreement with their respective covenants in all material respects; and (vi) the absence of a material adverse effect on Facet.
The Purchase Agreement contains certain termination rights for the parties to the Purchase Agreement, including (subject to certain limitations), the right to terminate the Purchase Agreement if (i) the Transactions are not consummated by October 31, 2026 (subject to election by any party to extend such date by up to six months); (ii) the other party breaches any of its representations, warranties or covenants (subject to specified materiality standards and cure periods set forth in the Purchase Agreement); or (iii) a law or order permanently preventing the Transactions has become final and nonappealable.
The parties to the Purchase Agreement have each made customary representations, warranties, and covenants in the Purchase Agreement. The representations and warranties of the parties to the Purchase Agreement do not survive the closing, and in connection with the Purchase Agreement, the Company bound a customary representations and warranties insurance policy subject to the satisfaction of certain customary conditions to coverage as recourse for certain losses arising out of any breach of the representations and warranties of the Seller contained in the Purchase Agreement.
The foregoing description of the Purchase Agreement and the Transactions is not complete and is subject to, and qualified in its entirety by reference to, the full text of the Purchase Agreement, a copy of which is attached hereto as Exhibit 2.1 and which is incorporated into this Item 1.01 by reference in its entirety. The representations, warranties and covenants in the Purchase Agreement: (i) were made solely for the benefit of the parties to the Purchase Agreement; (ii) are subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosure schedules; (iii) may have been made for the purposes of allocating contractual risk between the parties to the Purchase Agreement instead of establishing matters as facts; and (iv) are subject to the standards of materiality applicable to the contracting parties that may differ from those applicable to investors and security holders. Investors and security holders should not rely on any representations, warranties or covenants contained in the Purchase Agreement, or any descriptions thereof, as characterizations of the actual state of facts or conditions of the Company, the Sellers, Facet or any of their respective subsidiaries, affiliates or businesses. Information concerning the subject matter of any such representations, warranties and covenants may change after the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures.
