Company: DXPE
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001020710-25-000137
Chunk: 85

Company: DXP ENTERPRISES INC
Filing Date: 2025-08-07
Form: 10-Q
Item: Part I, Item 8
Chunk 85
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 an alternate base rate, Canadian prime rate or Canadian base rate plus a margin ranging from 0.25 percent to 0.75 percent per annum, in each case, based upon the average daily excess availability under the ABL Revolver for the most recently completed calendar quarter. Fees payable on the unused portion of the facility range from 0.25 percent to 0.375 percent per annum. At June 30, 2025 the unused line fee was 0.375 percent and there were no amounts outstanding under the ABL Revolver. On July 1, 2025 the Company entered into an Increase Agreement (the “Increase Agreement”) that provided for a $185.0 million asset-backed revolving line of credit (the "ABL Revolver"). Please refer to Note. 17 - Subsequent Events for additional discussion.GuaranteesEach of our current and future wholly owned material U.S. subsidiaries and DXP Enterprises, Inc. guarantees the obligations of our borrower under the ABL Revolver. Additionally, each of our Canadian subsidiaries guarantees the obligations of our Canadian borrower subsidiaries under the ABL Revolver.

11

SecurityObligations under the U.S. Borrowing Base are primarily secured, subject to certain exceptions, by a first-priority secure interest in the accounts receivable, inventory and related assets of our wholly owned, material U.S. subsidiaries. The security interest in accounts receivable, inventory, and related assets of the U.S. borrower subsidiaries ranks prior to the security interest in this collateral which secures the Term Loan B. The obligations under the Canadian Borrowing Base are primarily secured, subject to certain exceptions, by a first-priority secure interest in the accounts receivable, inventory and related assets of our wholly owned, material Canadian subsidiaries and our wholly owned material U.S. subsidiaries.Excess AvailabilityThe borrowing availability under our credit facility was $106.3 million and $125.6 million at June 30, 2025 and December 31, 2024, respectively.Interest rateThe interest rate for the ABL Revolver was 7.75 percent and 7.75 percent as of June 30, 2025 and December 31, 2024, respectively.Facility Size IncreasesThe ABL Credit Agreement allows for incremental increases in facility size up to an aggregate of $50 million.Financial CovenantThe Company's principal financial covenant under the ABL Credit Agreement include a Fixed Charge Coverage Ratio. The Fixed Charge Coverage Ratio under the ABL