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  4. [8-K] Construction Partners, Inc. Reports Material Event

Construction Partners (NASDAQ: ROAD) lifts credit revolver to $700M

Filing Impact
(High)
Filing Sentiment
(Neutral)
Form Type
8-K

Rhea-AI Filing Summary

Construction Partners, Inc. amended its Term Loan A / Revolver Credit Agreement to increase its revolving credit facility from $500.0 million to $700.0 million. The amendment also resets financial covenants, including a minimum consolidated interest coverage ratio of 2.75-to-1.00 and a step-down schedule for the maximum consolidated net leverage ratio through future fiscal quarters.

The revised agreement adds flexibility, such as permitting certain subsidiaries to be treated as Immaterial Subsidiaries, raising the material acquisition threshold to $100.0 million, and creating a restricted payment basket for stock repurchases of up to $50.0 million per fiscal year. It also enhances capital structure tools, including expanded Qualifying Cash netting, a longer reinvestment period for asset sale proceeds, Limited Condition Transaction provisions for acquisitions, and resetting the accordion to the greater of $400.0 million and Consolidated Adjusted EBITDA.

Positive

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Negative

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Insights

Amended credit facility adds liquidity and structural flexibility without changing core terms.

The company increased its revolving credit capacity from $500.0 million to $700.0 million, giving more committed liquidity for working capital, acquisitions, and general corporate uses. Covenant changes set a minimum consolidated interest coverage ratio of 2.75-to-1.00 and a phased maximum net leverage ratio through June 30, 2028 and beyond.

The amendment introduces a new basket allowing share repurchases up to $50.0 million per fiscal year and raises the material acquisition threshold to $100.0 million, which may support larger deals. It also increases permitted netting of Qualifying Cash with a $325.0 million floor and resets the accordion to the greater of $400.0 million and prior four-quarter Consolidated Adjusted EBITDA, potentially enabling further debt capacity.

Overall, this looks like a proactive refresh of financing terms with more flexibility rather than a distress-driven change. Actual leverage and buyback activity will depend on future management decisions and operating performance under these updated covenants.

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.
Revolving credit facility size $700.0 million Increased from $500.0 million under amended Term Loan A / Revolver Credit Agreement
Prior revolver size $500.0 million Original revolving credit facility before the Sixth Amendment
Minimum interest coverage ratio 2.75-to-1.00 Adjusted consolidated interest coverage covenant under the amendment
Maximum net leverage ratio (initial period) 4.75-to-1.00 For fiscal quarters ending June 30, 2026 through September 30, 2026
Maximum net leverage ratio (long term) 4.00-to-1.00 For fiscal quarters ending June 30, 2028 and thereafter, subject to adjustments
Annual share repurchase basket $50.0 million per fiscal year Additional restricted payment basket for stock repurchases, subject to conditions
Qualifying Cash floor $325.0 million Floor added to 50% of Consolidated Adjusted EBITDA limit for net leverage netting
Accordion capacity $400.0 million or Consolidated Adjusted EBITDA Reset to greater of $400.0 million and prior four-quarter Consolidated Adjusted EBITDA
Material acquisition threshold $100.0 million Increased from $75.0 million under the amended agreement
Immaterial Subsidiaries financial
"permits the designation of certain subsidiaries as “Immaterial Subsidiaries” that are not required to become guarantors"
consolidated net leverage ratio financial
"adjusts the maximum consolidated net leverage ratio as follows for future fiscal quarters"
The consolidated net leverage ratio measures how much debt a company carries compared with the cash it generates from core operations, calculated by taking total borrowings minus cash and dividing by annual operating profit. Like comparing a household’s mortgage balance to its yearly income, it tells investors how many years of operating profit would be needed to pay off net debt and thus gauges financial risk, flexibility to invest, and capacity to weather downturns.
Limited Condition Transaction financial
"introducing “Limited Condition Transaction” provisions that provide greater certainty for acquisition financing"
restricted payments financial
"include an additional basket permitting certain restricted payments in the form of stock repurchases"
Restricted payments are cash or asset transfers that a company is contractually barred or limited from making, such as dividends, stock buybacks, certain investments or returns of capital, typically under loan agreements or bond covenants. Investors care because these limits protect creditors by keeping cash in the business, and they directly affect shareholder returns and a company’s flexibility to reward owners or pursue opportunities — like rules on withdrawals from a shared bank account.
accordion financial
"resetting the amount of the accordion under the Term Loan A / Revolver Credit Agreement"
An accordion is a built‑in option in a financing agreement or corporate charter that lets a company expand or shrink the size of a loan, credit line, or authorized securities without starting a whole new approval process. Investors care because using the accordion can change how much debt a company carries or dilute existing shareholders when more shares are issued — think of it like expandable luggage that makes room when needed but can alter how your belongings are arranged.
Qualifying Cash financial
"limit on Qualifying Cash (as defined in the Amended Term Loan A / Revolver Credit Agreement) for purposes of determining the consolidated net leverage ratio"
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Understanding 8-K Material Events →
0001718227FALSE290 Healthwest Drive, Suite 2DothanAlabama3630300017182272026-06-032026-06-03

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): June 3, 2026 
CONSTRUCTION PARTNERS, INC.
(Exact name of registrant as specified in its charter) 
 
Delaware 001-38479 26-0758017
(State or other jurisdiction
of incorporation)		 (Commission
File Number)		 (I.R.S. Employer
Identification Number)
 
290 Healthwest Drive, Suite 2
Dothan, Alabama 36303
(Address of principal executive offices) (ZIP Code)
(334) 673-9763
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
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:
 
☐Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading symbol(s) Name of each exchange
on which registered
Class A common stock, $0.001 par value ROAD The Nasdaq Stock Market LLC
(Nasdaq Global Select Market)
Nasdaq Texas, LLC

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.

As previously disclosed, Construction Partners, Inc. (the “Company”), certain of its wholly owned subsidiaries in their capacity as co-borrowers (collectively with the Company, the “Borrowers”), and certain of the Company’s wholly owned subsidiaries in their capacity as guarantors (collectively with the Borrowers, the “Loan Parties”) are party to that certain Third Amended and Restated Credit Agreement (as amended from time to time, the “Term Loan A / Revolver Credit Agreement”) with PNC Bank, National Association, as administrative agent and lender, PNC Capital Markets LLC, as joint lead arranger and sole bookrunner, Regions Bank, BofA Securities, Inc., TD Bank, N.A. and City National Bank, each as a joint lead arranger, and certain other lenders party thereto (collectively, the “Lenders”).

On June 3, 2026, the Loan Parties and the Lenders entered into that certain Sixth Amendment to the Third Amended and Restated Credit Agreement (the “Amendment,” and the Term Loan A / Revolver Credit Agreement, as amended by the Amendment, the “Amended Term Loan A / Revolver Credit Agreement”). The Amendment, among other things, increases the existing revolving credit facility under the Term Loan A / Revolver Credit Agreement from $500.0 million to $700.0 million (the “Incremental Revolver Increase”) and adjusts certain financial covenants as described below.

In addition, the Amended Term Loan A / Revolver Credit Agreement (i) permits the designation of certain subsidiaries as “Immaterial Subsidiaries” that are not required to become guarantors under the Amended Term Loan A / Revolver Credit Agreement, subject to certain conditions, (ii) increases the material acquisition threshold from $75.0 million to $100.0 million, and (iii) modifies certain negative covenants as described below.

With respect to financial covenants, the Amendment adjusts the minimum consolidated interest coverage ratio to 2.75-to-1.00 and adjusts the maximum consolidated net leverage ratio as follows for future fiscal quarters: (i) for each fiscal quarter ending June 30, 2026 through and including September 30, 2026, 4.75-to-1.00; (ii) for each fiscal quarter ending December 31, 2026 through and including June 30, 2027, 4.50-to-1.00; (iii) for each fiscal quarter ending September 30, 2027 through and including March 31, 2028, 4.25-to-1.00; and (iv) for each fiscal quarter ending June 30, 2028 and thereafter, 4.00-to-1.00, subject to certain adjustments. The Amendment also modifies certain negative covenants to, among other things, (i) permit the liquidation or dissolution of Immaterial Subsidiaries, subject to certain conditions, (ii) include an additional basket permitting certain restricted payments in the form of stock repurchases under any share repurchase plan in an aggregate amount not to exceed $50.0 million per fiscal year, subject to certain conditions, and (iii) provide the Company with additional flexibility to access additional sources of capital and manage its capital structure, in each case subject to compliance with specified financial ratio tests, maturity and other customary conditions.

The Amendment also makes certain other modifications to the Term Loan A / Revolver Credit Agreement, including (i) permitting additional netting of unrestricted cash and cash equivalents by adding a floor of $325.0 million to the existing 50% of Consolidated Adjusted EBITDA (as defined in the Amended Term Loan A / Revolver Credit Agreement) limit on Qualifying Cash (as defined in the Amended Term Loan A / Revolver Credit Agreement) for purposes of determining the consolidated net leverage ratio, (ii) extending the reinvestment period for asset disposition proceeds from 180 days to one year, (iii) introducing “Limited Condition Transaction” provisions that provide greater certainty for acquisition financing for qualifying acquisitions at the Company’s option, (iv) resetting the amount of the accordion under the Term Loan A / Revolver Credit Agreement, after giving effect to the Incremental Revolver Increase, at the existing level of the greater of $400.0 million and Consolidated Adjusted EBITDA for the prior four fiscal quarters, and (v) making certain other conforming, clarifying and administrative changes.

Except as modified by the Amendment, the terms of the Term Loan A / Revolver Credit Agreement remain the same.

The Lenders that are parties to the Amended Term Loan A / Revolver Credit Agreement and their respective affiliates are full-service financial institutions engaged in various activities, which may include sales and trading, commercial and investment banking, advisory, investment management, investment research, principal investment, hedging, market making, brokerage, and other financial and non-financial activities and services. Certain of these financial institutions and their respective affiliates have provided, and may in the future provide, such services to the Loan Parties and to persons and entities with relationships with the Loan Parties, for which they received or will receive customary fees and expenses.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

In connection with the Amendment described in Item 1.01 above, the aggregate revolving credit commitments under the Amended Term Loan A / Revolver Credit Agreement were increased from $500.0 million to $700.0 million. The information provided in Item 1.01 of this Current Report on Form 8-K is incorporated by reference herein.



SIGNATURES
 
Pursuant to the requirements 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.

CONSTRUCTION PARTNERS, INC.
Date: June 8, 2026By:/s/ Gregory A. Hoffman
Gregory A. Hoffman
Senior Vice President and Chief Financial Officer



Source: View Original Filing on SEC EDGAR

FAQ

What did Construction Partners, Inc. (ROAD) change in its credit facility?

The company amended its Term Loan A / revolver to increase the revolving credit facility from $500.0 million to $700.0 million. It also updated financial covenants, expanded cash netting, extended reinvestment periods, and reset its accordion feature to preserve additional future borrowing capacity.

How do the new leverage and interest coverage covenants affect Construction Partners (ROAD)?

The amendment sets a minimum consolidated interest coverage ratio of 2.75-to-1.00 and a phased maximum consolidated net leverage ratio that steps from 4.75-to-1.00 down to 4.00-to-1.00 by later fiscal quarters, defining future headroom for borrowing and earnings performance.

Did Construction Partners (ROAD) gain new share repurchase capacity in this amendment?

Yes. The amended agreement adds a restricted payment basket allowing stock repurchases under any share repurchase plan in an aggregate amount of up to $50.0 million per fiscal year. These repurchases remain subject to specified financial ratio tests and other customary conditions.

What changes were made to support acquisitions for Construction Partners (ROAD)?

The material acquisition threshold increased from $75.0 million to $100.0 million. The credit agreement also added Limited Condition Transaction provisions, giving the company greater certainty for financing qualifying acquisitions at its option, within the updated covenant and maturity framework.

How was Qualifying Cash treatment revised in Construction Partners’ amended agreement?

The amendment allows additional netting of unrestricted cash and cash equivalents for the consolidated net leverage ratio by adding a $325.0 million floor to the existing 50% of Consolidated Adjusted EBITDA limit on Qualifying Cash, potentially improving reported leverage metrics when cash balances are high.

What is the new accordion capacity under Construction Partners’ amended credit agreement?

After giving effect to the $200.0 million Incremental Revolver Increase, the amendment resets the accordion to the greater of $400.0 million and Consolidated Adjusted EBITDA for the prior four fiscal quarters, preserving room for additional future financing under the facility.

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