DXP Enterprises (NASDAQ: DXPE) expands ABL facility to $225M amid strong growth
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
DXP Enterprises, Inc. entered into a Second Amended and Restated Loan and Security Agreement that expands its asset-based revolving credit facility to provide up to $225.0 million in revolving loans. Up to $210.0 million is available to U.S. borrowers and up to $15.0 million to Canadian borrowers, with potential incremental increases of up to $50.0 million in $10.0 million minimum increments. The facility matures on July 2, 2031 and bears interest at Term SOFR or Term CORRA plus a margin of 1.25%–1.75% per year, or alternative base rates plus a margin of 0.25%–0.75%, based on availability. The facility is secured by substantially all borrower assets and includes customary covenants, including a fixed charge coverage ratio covenant during defined compliance periods. In the accompanying press release, DXP highlights growth from $1.1 billion in 2021 sales to $2.1 billion for the last twelve months ended March 31, 2026, and net income growth from $16.4 million to $88.1 million over the same timeframe.
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Insights
DXP ups its ABL capacity and showcases strong multi‑year growth.
DXP Enterprises increased commitments under its asset-based revolver from $185 million to $225 million, with an option to add another $50 million. The facility, maturing on July 2, 2031, provides liquidity to fund working capital, organic initiatives, and acquisitions.
Pricing is tied to Term SOFR or Term CORRA plus a 1.25%–1.75% margin, or base rates plus a 0.25%–0.75% margin, depending on excess availability. Covenants include limits on additional debt, liens, dividends, and a fixed charge coverage ratio test when availability falls below a specified threshold.
Management cites strong underlying performance: sales increased from $1.1 billion in 2021 to $2.1 billion for the last twelve months ended March 31, 2026, net income rose from $16.4 million to $88.1 million, and covenant compliance adjusted EBITDA grew from $74.9 million to over $243.9 million. These figures suggest the enlarged facility is being layered onto a larger earnings base, though ongoing compliance with leverage and coverage covenants remains important.
8-K Event Classification
4 items: 1.01, 2.03, 8.01, 9.01
4 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 2.03
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement
Financial
The company incurred a new significant debt or off-balance-sheet obligation.
Item 8.01
Other Events
Other
Voluntary disclosure of events the company deems important to shareholders but not covered by other items.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
ABL Facility Size: $225.0 million
Prior ABL Commitments: $185 million
Incremental Capacity: $50.0 million
+5 more
8 metrics
ABL Facility Size
$225.0 million
Aggregate principal amount of asset-based revolving loans under the amended facility
Prior ABL Commitments
$185 million
Total commitments under the existing ABL Facility before the $40 million increase
Incremental Capacity
$50.0 million
Potential increase to the ABL Facility in minimum $10.0 million increments
US ABL Sub-facility
$210.0 million
Maximum amount available to U.S. borrowers under the ABL Facility
Canadian ABL Sub-facility
$15.0 million
Maximum amount available to Canadian borrowers under the ABL Facility
Facility Maturity
July 2, 2031
Stated maturity date of the Second Amended and Restated Loan Agreement
Sales Growth
$1.1 billion to $2.1 billion
Sales from 2021 to last twelve months ended March 31, 2026
Net Income Growth
$16.4 million to $88.1 million
Net income from 2021 to last twelve months ended March 31, 2026
Key Terms
asset-based revolving credit facility, Term SOFR, Term CORRA, fixed charge coverage ratio, +1 more
5 terms
asset-based revolving credit facility financial
"aggregate commitments under the Company’s existing asset-based revolving credit facility (the “ABL Facility”)"
A loan arrangement where a lender agrees to make funds available up to a set limit that a borrower can draw, repay, and draw again, with the amount available tied to the value of specific assets (like inventory, receivables, or equipment) pledged as collateral. It matters to investors because it provides flexible working capital while limiting risk exposure: the company can fund growth or cover shortfalls quickly, but borrowing capacity can shrink if asset values fall.
Term SOFR financial
"Interest shall accrue on outstanding borrowings at a rate equal to Term SOFR or Term CORRA plus a margin"
Term SOFR is a benchmark interest rate that reflects the cost of borrowing money over a specific period, based on actual transactions in the financial markets. It is used by lenders and borrowers to set the interest rates on loans and financial contracts, helping to ensure rates are fair and transparent. For investors, understanding term SOFR helps gauge borrowing costs and the overall direction of interest rates in the economy.
Term CORRA financial
"Interest shall accrue on outstanding borrowings at a rate equal to Term SOFR or Term CORRA plus a margin"
Term CORRA is a forward-looking short-term interest rate based on the Canadian Overnight Repo Rate Average (CORRA) that gives a simple snapshot of expected borrowing costs over set periods (for example, one or three months). Think of it like a supermarket price tag for short-term money: it helps lenders, borrowers and investors know the going rate in advance, which matters for pricing loans, floating-rate debt and derivatives and for comparing returns across cash instruments.
fixed charge coverage ratio financial
"restricting the Company from allowing its fixed charge coverage ratio to be less than 1.00:1.00"
A fixed charge coverage ratio measures how well a company's operating income can cover its fixed, recurring obligations like interest payments and lease costs. Think of it as a safety margin — the higher the number, the more comfortably a business can pay steady bills from its normal earnings, which matters to investors because it signals financial stability, lower default risk, and greater ability to withstand revenue dips.
covenant compliance adjusted EBITDA financial
"covenant compliance adjusted EBITDA grew from $74.9 million in 2021 to over $243.9 million"
FAQ
What did DXP Enterprises (DXPE) announce regarding its credit facility?
DXP Enterprises entered into a Second Amended and Restated Loan and Security Agreement that increases its asset-based revolving credit facility commitments from $185 million to $225 million, extending liquidity for operations, growth initiatives, and acquisitions.
How large is DXP Enterprises’ new ABL Facility and how is it allocated?
The revised ABL Facility provides for up to $225.0 million in revolving loans, including up to $210.0 million available to U.S. borrowers and up to $15.0 million available to Canadian borrowers under separate sub-facilities.
When does DXP Enterprises’ amended ABL Facility mature?
The Second Amended and Restated Loan and Security Agreement sets the maturity of DXP Enterprises’ asset-based revolving credit facility at July 2, 2031, providing a long-dated source of committed financing for the company and its subsidiaries.
What interest rates apply under DXP Enterprises’ new ABL Facility?
Borrowings accrue interest at Term SOFR or Term CORRA plus a 1.25%–1.75% margin, or at alternate base, Canadian prime, or Canadian base rates plus a 0.25%–0.75% margin, depending on average excess availability.
How has DXP Enterprises’ financial performance changed since 2021?
DXP reports sales increasing from $1.1 billion in 2021 to $2.1 billion for the last twelve months ended March 31, 2026, with net income rising from $16.4 million to $88.1 million and covenant compliance adjusted EBITDA exceeding $243.9 million.
Does the ABL Facility include any financial covenants for DXP Enterprises (DXPE)?
Yes. The agreement includes a covenant that restricts DXP from allowing its fixed charge coverage ratio to fall below 1.00:1.00 during a compliance period triggered when availability under the ABL Facility drops below a specified threshold.
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): July 2, 2026
Commission file number 0-21513
(Exact name of registrant as specified in its charter)
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| (Address of principal executive offices) | (Registrant’s telephone number, including area code) | ||||||||||||||||
_________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Exchange Act:
| Title of Each Class | Trading Symbol | Name of Exchange on which Registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ⃞
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01. Entry into a Material Definitive Agreement.
On July 2, 2026 DXP Enterprises, Inc. (the “Company”) entered into a Second Amended and Restated Loan and Security Agreement (the “Second A&R Credit Agreement”) by and among the Company, certain of the Company’s US subsidiaries, as borrowers (together with the Company, the “US Borrowers”), certain of the Company’s Canadian subsidiaries, as borrowers (the “Canadian Borrowers”, and together with the US Borrowers, the “Borrowers”), Bank of America, N.A., as agent, certain financial institutions, as lenders, Bank of America, N.A., as sole lead arranger and sole bookrunner, and each of U.S. Bank, National Association and PNC Bank, National Association, as documentation agents.. The ABL Credit Agreement provides for asset-based revolving loans (the “ABL Loans”) in an aggregate principal amount of up to $225.0 million, with up to $210.0 million to be made available to the US Borrowers (the “US ABL Facility”) and up to $15.0 million to be made available to the Canadian Borrowers (the “Canadian ABL Facility” and together with the US ABL Facility, the “ABL Facility”). The ABL Credit Agreement amends and restates the Amended and Restated Loan and Security Agreement dated as of July 19, 2022, by and among the Company, certain of its subsidiaries, Bank of America, N.A., as agent, and the other agents and lenders party thereto.
Subject to the conditions set forth in the Second A&R Credit Agreement, the ABL Facility may be increased by up to an aggregate of $50.0 million, in minimum increments of $10.0 million.
The ABL Facility will mature on July 2, 2031. Interest shall accrue on outstanding borrowings at a rate equal to Term SOFR or Term CORRA plus a margin ranging from 1.25% to 1.75% per annum, or at an alternate base rate, Canadian prime rate or Canadian base rate plus a margin ranging from 0.25% to 0.75% per annum, in each case, based upon the average daily excess availability under the ABL Facility for the most recently completed calendar quarter. Fees ranging from 0.25% to 0.375% per annum will be payable on the portion of the US ABL Facility not in use at any given time, and fees ranging from 0.25% to 0.375% per annum will be payable on the portion of the Canadian ABL Facility not in use at any given time.
The obligations of the Borrowers under the ABL Facility are guaranteed by the Company and its direct and indirect material wholly-owned subsidiaries other than certain excluded subsidiaries; provided that the obligations of the US Borrowers will not be guaranteed by any of the Company’s Canadian subsidiaries. The ABL Facility is secured by substantially all of the assets of the Borrowers; provided that the obligations of the US Borrowers will not be secured by any liens on more than 65% of the voting stock of the Company’s non-U.S. subsidiaries or by assets of the non-U.S. subsidiaries.
The ABL Credit Agreement contains representations and warranties and affirmative and negative covenants that are usual and customary, including representations, warranties and covenants that, among other things, restrict the ability of the Company and its subsidiaries to incur additional debt, incur or permit liens on assets, make investments and acquisitions, consolidate or merge with any other company, engage in asset sales, pay dividends, and make distributions. The ABL Credit Agreement contains a financial covenant restricting the Company from allowing its fixed charge coverage ratio to be less than 1.00:1.00 during a compliance period, which is triggered when the availability under ABL Facility falls below a threshold set forth in the ABL Credit Agreement. Obligations under the ABL Credit Agreement may be accelerated upon certain customary events of default (subject to grace periods, as appropriate), including among others: nonpayment of principal, interest or fees; breach of the affirmative or negative covenants; breach of the representations or warranties in any material respect; event of default under, or acceleration of, other material indebtedness; bankruptcy or insolvency; material judgments entered against the Company or any of its subsidiaries; invalidity or unenforceability of any security documentation associated with the ABL Facility; and a change of control of the Company.
The foregoing description is only a summary of the material provisions of the Second A&R Credit Agreement and is qualified in its entirety by reference to a copy of the Second A&R Credit Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K and incorporated herein by reference. Capitalized terms not defined herein shall have the meanings assigned to such terms in the Second A&R Credit Agreement, as context requires.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The disclosure required by this item is included in Item 1.01 above and is incorporated herein by reference.
Item 8.01. Other Events.
On July 9, 2026, the Company issued a press release announcing its entry into the Second A&R Credit Agreement. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | ||||||||||
| 10.1 | Second Amended and Restated Loan and Security Agreement, dated as of July 2, 2026, by and among the Company and the other persons party thereto, as borrowers, the other persons party thereto from time to time, as guarantors, Bank of America, N.A., as agent, certain financial institutions, as lenders, Bank of America, N.A., as sole lead arranger and sole bookrunner, and each of U.S. Bank, National Association and PNC Bank, National Association, as documentation agents. | ||||||||||
| 99.1 | Press Release, dated July 9, 2026, announcing the Company’s entry into the Second A&R Credit Agreement. | ||||||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | ||||||||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
DXP ENTERPRISES, INC.
| July 9, 2026 | By: /s/ Kent Yee | ||||
Kent Yee | |||||
Senior Vice President/Finance and Chief Financial Officer | |||||
By: /s/ David Molero Santos | |||||
David Molero Santos | |||||
Vice President/Finance and Chief Accounting Officer | |||||
NEWS RELEASE July 9, 2026 CONTACT: Kent Yee Senior Vice President CFO 713-996-4700 – www.dxpe.com THE INDUSTRIAL DISTRIBUTION EXPERTS DXP ENTERPRISES, INC. ANNOUNCES NEW ABL REVOLVER Increases size of ABL from $185 million to $225 million Further aligns capital structure with actions to support growth strategy Maintains liquidity and continues to support acquisition strategy Positions DXP to optimize cost of capital Houston, TX, -- July 9, 2026 – DXP Enterprises, Inc. (NASDAQ: DXPE) today announced that on July 2, 2026, DXP Enterprises, Inc. (the “Company”) entered into a Second Amended and Restated Loan Agreement (the “Second A&R Credit Agreement”) by and among the Company and certain of the Company’s subsidiaries as borrowers, certain other subsidiaries of the Company as guarantors, pursuant to which the aggregate commitments under the Company’s existing asset-based revolving credit facility (the “ABL Facility”) were increased by $40 million. Following the effectiveness of the Second Amended Agreement, the total commitments under the ABL Facility increased from $185 million to $225 million. The ABL Facility now provides for asset-based revolving loans in an aggregate principal amount of up to $225.0 million, with up to $210.0 million to be made available to the US Borrowers (the “US ABL Facility”) and up to $15.0 million to be made available to the Canadian Borrowers (the “Canadian ABL Facility” and together with the US ABL Facility, the “ABL Facility”). The Second Amended and Restated Loan Agreement was entered into pursuant to the terms of the ABL Facility, which permits the Company to request incremental increases in the aggregate commitments, subject to certain conditions. The ABL Facility will mature on July 2, 2031. Interest shall accrue on outstanding borrowings at a rate equal to Term SOFR or Term CORRA plus a margin ranging from 1.25% to 1.75% per annum, or at an alternate base rate, Canadian prime rate or Canadian base rate plus a margin ranging from 0.25% to 0.75% per annum, in each case, based upon the average daily excess availability under the ABL Facility for the most recently completed calendar quarter. Subject to the conditions set forth in the Second A&R Credit Agreement, the ABL Facility may be increased by up to an aggregate of $50.0 million, in minimum increments of $10.0 million. The Second Amended and Restated Loan Agreement provides DXP with continued operational and financial flexibility to reinvest in the business, pursue its organic and acquisition growth strategy, and positions the Company to optimize its cost of capital as it continues to evolve from a capital structure standpoint. David R. Little, Chairman and Chief Executive Officer remarked, “We are pleased with our new ABL. We will take this positive momentum, push to close out the year strong during the second half of 2026 and look to drive further growth in 2027. Our capital allocation strategy includes a mix of continuing to fund growth; applying excess cash flow to debt service, when appropriate; reinvesting in the business through our facilities, equipment, and software; and supporting DXP in the market. We plan to maintain liquidity and flexibility while pursuing growth opportunities and reinvesting in the business and positioning ourselves to lower our cost of capital as we move forward.” Kent Yee, Chief Financial Officer added, “As David mentioned, we are pleased with our new ABL, increasing our borrowing capacity by $40 million. This accomplished several objectives, including maintaining liquidity and flexibility as we continue to grow both organically and through acquisitions while strategically reinvesting in the business. Additionally, this new facility will put us in a position in the future to lower our cost of capital as we continue to produce free cash flow while the DXP continues its growth trajectory. DXP continues to diversify and transform the business as evidenced by sales growing from $1.1 billion in 2021 to $2.1 billion for the last twelve months ending March 31, 2026, and net income growing from $16.4 million in 2021 to $88.1 million for the last twelve months ending March 31, 2026. Also, covenant compliance adjusted EBITDA grew from $74.9 million in 2021 to over $243.9 million through the last twelve months ending March 31, 2026. We appreciate the support from our advisors and lender group.” Additional details regarding the Second Amended Agreement will be available in DXP’s Current Report on Form 8-K to be filed with the Securities and Exchange Commission by July 9th. About DXP Enterprises, Inc. DXP Enterprises, Inc. is a leading products and service distributor that adds value and total cost savings solutions to industrial customers throughout the United States, Canada, Mexico, and Dubai. DXP provides innovative pumping solutions, supply chain services and maintenance, repair, operating and production ("MROP") services that emphasize and utilize DXP’s vast product knowledge and technical expertise in rotating equipment, bearings, power transmission, metal working, industrial supplies and safety products and services. DXP's breadth of MROP products and service solutions allows DXP to be flexible and customer-driven, creating competitive advantages for our customers. DXP’s business segments include Service Centers, Innovative Pumping Solutions and Supply Chain Services. For more information, go to www.dxpe.com. The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward-looking statements. Certain information included in this press release (as well as information included in oral statements or other written statements made by or to be made by the Company) contain statements that are forward-looking. Such forward- looking information involves important risks and uncertainties that could significantly affect anticipated results in the future; and accordingly, such results may differ
NEWS RELEASE July 9, 2026 CONTACT: Kent Yee Senior Vice President CFO 713-996-4700 – www.dxpe.com THE INDUSTRIAL DISTRIBUTION EXPERTS from those expressed in any forward-looking statement made by or on behalf of the Company. These risks and uncertainties include but are not limited to; ability to obtain needed capital, dependence on existing management, leverage, and debt service, domestic or global economic conditions, and changes in customer preferences and attitudes. In some cases, you can identify forward-looking statements by terminology such as, but not limited to, “may,” “will,” “should,” “intend,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “goal,” or “continue” or the negative of such terms or other comparable terminology. For more information, review the Company’s filings with the Securities and Exchange Commission.