Item 1.01 Entry into a Material Definitive Agreement.

On January 28, 2020, Twin Disc, Incorporated (the "Company") entered into an Amendment No. 3 to Credit Agreement (the "Third Amendment") that amends the Credit Agreement dated as of June 29, 2018 (the "Credit Agreement") between the Company and BMO Harris Bank, N.A. (the "Bank"). The Third Amendment restates the financial covenant provisions related to the maximum allowable ratio of total funded debt to earnings before interest, taxes, depreciation and amortization (as defined in the agreement) ("EBITDA") from 3.00 to 1.00 to 4.00 to 1.00 for the quarter ended December 27, 2019, 5.00 to 1.00 for the quarter ending March 27, 2020, 4.00 to 1.00 for the quarter ending June 30, 2020, 3.50 to 1.00 for the quarter ending September 25, 2020 and 3.00 to 1.00 for quarters ending on or after December 25, 2020. For purposes of determining EBITDA, the Third Amendment adds back extraordinary expenses (not to exceed $3.9 million) related to a previously reported isolated product performance issue on one of the Company's oil and gas transmission models at certain installations. The Third amendment also restates the definition of "Applicable Margin" to be applied to revolving loans and term loans based on the then current Total Funded Debt to EBITDA ratio as of the pricing date for such loan. The Company also agreed to provide the Bank with 12-month financial forecasts at the end of each calendar month during calendar year 2020.

The Third Amendment also contains provisions relating to the possible discontinuation or obsolescence of the London Interbank Offered Rate ("LIBOR"). Upon the occurrence of a LIBOR Transition Event (as defined in the Third Amendment), the Bank, with the consent of the Company, may amend the Credit Agreement to replace LIBOR-based rates (or rates that include a LIBOR component in determining the applicable rate) with new rates based on a Benchmark Replacement (as defined in the Third Amendment) used by the Bank in other financing transactions of similar size and nature.

The above description of the Third Amendment is qualified in its entirety by reference thereto, a copy of which is filed as Exhibit 1.1 to this Current Report on Form 8-K and is incorporated herein by reference.

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Item 9.01         Financial Statements and Exhibits.



(d)   Exhibits.

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EXHIBIT NUMBER DESCRIPTION



1.1              Amendment No. 3 to June 29, 2018 Credit Agreement between Twin Disc,
               Incorporated and BMO Harris Bank, N.A.

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Pursuant to the requirements of section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: January 30, 2020 Twin Disc, Incorporated



                          /s/ Jeffrey S. Knutson
                       Jeffrey S. Knutson
                       Vice President-Finance, Chief Financial
                       Officer, Treasurer & Secretary

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