Item 1.01. Entry into a Material Definitive Agreement

On September 24, 2014, MTS Systems Corporation (the “Company”) entered into a $200 million senior unsecured five-year revolving credit facility (the “Credit Agreement” or the “Revolving Credit Facility”) among the Company, U.S. Bank National Association and HSBC Bank USA, National Association as Co-Documentation Agents, Wells Fargo Bank, National Association as Syndication Agent and JPMorgan Chase Bank, N.A. as Administrative Agent (collectively, the “Lenders”), and J.P. Morgan Securities LLC and Wells Fargo Securities, LLC as Joint Bookrunners and Joint Lead Arrangers.

The Revolving Credit Facility is available to the Company and to each Foreign Subsidiary Borrower (as defined in the Credit Agreement), which shall become a party to the Credit Agreement, on a revolving basis (collectively, the “Loans”). Amounts borrowed by Foreign Subsidiary Borrowers are limited to the total U.S. Dollar equivalent aggregate amount of $75 million. The Company may also from time to time elect to increase the commitments of the Lenders or enter into one or more tranches of term loans in minimum increments of $10 million up to an aggregate amount of $75 million as such increases may be agreed to by the Company, the Administrative Agent and each of the Lenders and/or one or more new banks, financial institutions or other entities providing the additional financing. The proceeds of the Loans will be used for general corporate purposes (including working capital financing, permitted acquisitions, share repurchases and other restricted payments as permitted under the Credit Agreement), of the Company and its subsidiaries in the ordinary course of business.

Request for borrowings will be categorized by the Company and the Lenders as defined in the Credit Agreement. The primary categories of borrowing include Eurocurrency Borrowing, ABR Borrowing, and Swingline Loans. ABR Borrowings and Swingline Loans made in U.S. Dollars under the Credit Agreement bear interest at a rate per annum equal to the Alternate Base Rate (defined as the greatest of (a) the Prime Rate (as defined in the Credit Agreement) in effect on such day, (b) the Federal Funds Effective Rate (as defined in the Credit Agreement) in effect on such day plus 1/2 of 1% and (c) the Adjusted LIBO Rate (as defined in the Credit Agreement) for a one month Interest Period in dollars on such day plus 1%), plus the value in the ABR Spread column of the imbedded chart based upon the Leverage Ratio applicable on such date.

Eurocurrency Borrowings made under the Credit Agreement bear interest at a rate per annum equal to the Adjusted LIBO Rate for the interest period in effect for such Eurocurrency Borrowing plus the value in the Eurocurrency Spread column of the imbedded chart based upon the Leverage Ratio applicable on such date:

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