Company: DXPE
Filing Date: 2025-04-30
Form Type: ARS
Source: 0001020710-25-000081
Chunk: 85

Company: DXP ENTERPRISES INC
Filing Date: 2025-04-30
Form: ARS
Chunk 85
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ured Leverage Ratio, The Term Loan B Agreement requires that the Company’s Secured Leverage Ratio, defined as the ratio, as of the last day of any fiscal quarter of consolidated secured debt (net of unrestricted cash, not to exceed $200 million) as of such day to EBITDA, beginning with the fiscal quarter ending December 31, 2024, is either equal to or less than as indicated in the table below: Fiscal Quarter Secured Leverage Ratio December 31, 2024 5.75:1.00 March 31, 2025 5.75:1.00 June 30, 2025 5.50:1.00 September 30, 2025 5.50:1.00 December 31, 2025 5.50:1.00 March 31, 2026 5.25:1.00 June 30, 2026 5.25:1.00 September 30, 2026 5.25:1.00 December 31, 2026 5.00:1.00 March 31, 2027 5.00:1.00 June 30, 2027 and thereafter 4.75:1.00 As of December 31, 2024, the Company’s Secured Leverage Ratio was 2.43 to 1.00. The Term Loan contains restrictive covenants (in each case, subject to exclusions) that limit, among other things, the ability of the Company and its restricted subsidiaries to: • make investments, including acquisitions; • prepay certain indebtedness; • grant liens; • incur additional indebtedness; • sell assets; • make fundamental changes to our business; • enter into transactions with affiliates; and • pay dividends. The Term Loan also contains other customary restrictive covenants. The covenants are subject to various baskets and materiality thresholds, with certain of the baskets permitted by the restrictions on the repayment of subordinated indebtedness, restricted payments and investments being available only when the Senior Secured Leverage Ratio of the Company is below certain levels. EBITDA as defined under the Term Loan B Agreement for financial covenant purposes means, without duplication, for any period of determination, the sum of, consolidated net income during such period; plus to the extent deducted from consolidated net income in such period: (i) income tax expense, (ii) franchise tax expense, (iii) interest