XML 32 R17.htm IDEA: XBRL DOCUMENT
v3.3.1.900

LONG-TERM DEBT | 12 Months Ended
--- | ---
Dec. 31, 2015
LONG-TERM DEBT [Abstract] |
LONG-TERM DEBT | NOTE 9 – LONG-TERM DEBT Long-term debt consisted of the following (in thousands):
|  | December 31, |
|  | 2015 |  |  | 2014 |
Line of credit |  | $ | 172,147 |  |  | $ | 193,443 |
Term loan |  |  | 175,000 |  |  |  | 212,500 |
Promissory note payable in monthly installments at 2.9% through January 2021, collateralized by equipment |  |  | 4,408 |  |  |  | 5,216 |
Unsecured subordinated notes payable in quarterly installments at 5% |  |  | - |  |  |  | 357 |
Less unamortized debt issuance costs |  |  | (2,046 | ) |  |  | (2,714 | )
Total Debt |  |  | 349,509 |  |  |  | 408,802 |
Less: Current maturities |  |  | (50,829 | ) |  |  | (38,608 | )
Total Long-term Debt |  | $ | 298,680 |  |  | $ | 370,194 |
On July 11, 2012, DXP entered into a credit facility with Wells Fargo Bank National Association, as Issuing Lender, Swingline Lender and Administrative Agent for the lenders (as amended, the “Original Facility”). On January 2, 2014, the Company entered into an Amended and Restated Credit Agreement with Wells Fargo Bank, National Association, as Issuing Lender and Administrative Agent for other lenders (as thereafter amended or restated, the “Facility”), amending and restating the Original Facility. On August 6, 2015 and September 30, 2015, DXP amended the Facility. The Facility provides a term loan and a $350 million revolving line of credit to the Company. At December 31, 2015, the term loan component of the Facility was $175.0 million. The Facility expires on January 2, 2019. The Facility provides the option of interest at LIBOR (or CDOR for Canadian dollar loans) plus an applicable margin ranging from 1.25% to 2.75% or prime plus an applicable margin from 0.25% to 1.75% where the applicable margin is determined by the Company’s leverage ratio as defined by the Facility as of the last day of the fiscal quarter most recently ended prior to the date of borrowing. Commitment fees of 0.20% to 0.50% per annum are payable on the portion of the Facility capacity not in use at any given time on the line of credit. Commitment fees are included as interest in the consolidated statements of income. On December 31, 2015, the LIBOR based rate of the Facility was LIBOR plus 2.25% the prime based rate of the Facility was prime plus 1.25%, and the commitment fee was 0.40%. At December 31, 2015, $347.1 million was borrowed under the Facility at a weighted average interest rate of approximately 2.67% under the LIBOR options. At December 31, 2015, the Company had $19.8 million available for borrowing under the Facility. The Facility contains financial covenants defining various financial measures and levels of these measures with which the Company must comply. Covenant compliance is assessed as of each quarter end. Substantially all of the Company’s assets are pledged as collateral to secure the Facility. At December 31, 2015, the Facility’s principal financial covenants included: Consolidated Leverage Ratio – The Facility requires that the Company’s Consolidated Leverage Ratio, determined at the end of each fiscal quarter, not exceed 4.25 to 1.00 as of the last day of each quarter through September 30, 2016, not to exceed 4.00 to 1.00 on December 31, 2016, not to exceed 3.75 to 1.00 from March 31, 2017 through June 30, 2017, not to exceed 3.50 to 1.00 from September 30, 2017 through December 31, 2017, and not to exceed 3.25 to 1.00 on March 31, 2018 and thereafter. The Consolidated Leverage Ratio is defined as the outstanding indebtedness divided by Consolidated EBITDA for the period of four consecutive fiscal quarters ending on or immediately prior to such date. Indebtedness is defined under the Facility for financial covenant purposes as: (a) all obligations of DXP for borrowed money including but not limited to obligations evidenced by bonds, debentures, notes or other similar instruments; (b) obligations to pay deferred purchase price of property or services; (c) capital lease obligations; (d) obligations under conditional sale or other title retention agreements relating to property purchased; and (e) contingent obligations for funded indebtedness. At December 31, 2015, the Company’s Leverage Ratio was 4.02 to 1.00. Consolidated Fixed Charge Coverage Ratio – The Facility requires that the Consolidated Fixed Charge Coverage Ratio on the last day of each quarter be not less than 1.15 to 1.00 through December 31, 2016 and not less than 1.25 to 1.00 on March 31, 2017 and thereafter, with “Consolidated Fixed Charge Coverage Ratio” defined as the ratio of (a) Consolidated EBITDA for the period of 4 consecutive fiscal quarters ending on such date minus capital expenditures during such period (excluding acquisitions) minus income tax expense paid minus the aggregate amount of restricted payments defined in the agreement to (b) the interest expense paid in cash, scheduled principal payments in respect of long-term debt and the current portion of capital lease obligations for such 12-month period, determined in each case on a consolidated basis for DXP and its subsidiaries. At December 31, 2015, the Company's Consolidated Fixed Charge Coverage Ratio was 1.23 to 1.00. Asset Coverage Ratio –The Facility requires that the Asset Coverage Ratio at any time be not less than 1.0 to 1.0 with “Asset Coverage Ratio” defined as the ratio of (a) the sum of 85% of net accounts receivable plus 65% of net inventory to (b) the aggregate outstanding amount of the revolving credit on such date. At December 31, 2015, the Company's Asset Coverage Ratio was 1.15 to 1.00. Consolidated EBITDA as defined under the Facility for financial covenant purposes means, without duplication, for any period the consolidated net income of DXP plus, to the extent deducted in calculating consolidated net income, depreciation, amortization (except to the extent that such non-cash charges are reserved for cash charges to be taken in the future), non-cash compensation including stock option or restricted stock expense, interest expense and income tax expense for taxes based on income, certain one-time costs associated with our acquisitions, integration costs, facility consolidation and closing costs, write-down of cash expenses incurred in connection with the existing credit agreement and extraordinary losses less interest income and extraordinary gains. Consolidated EBITDA shall be adjusted to give pro forma effect to disposals or business acquisitions assuming that such transaction(s) had occurred on the first day of the period excluding all income statement items attributable to the assets or equity interests that is subject to such disposition made during the period and including all income statement items attributable to property or equity interests of such acquisitions permitted under the Facility. The following table sets forth the computation of the Leverage Ratio as of December 31, 2015 (in thousands, except for ratios):
For the Twelve Months ended December 31, 2015 |  | Leverage Ratio |
Loss before taxes |  | $ | (38,920 | )
Loss attributable to noncontrolling interest |  |  | 813 |
Interest expense |  |  | 10,932 |
Depreciation and amortization |  |  | 33,243 |
Impairment expense |  |  | 68,735 |
Stock compensation expense |  |  | 2,973 |
Pro forma acquisition EBITDA |  |  | 2,244 |
B27 settlment |  |  | 7,348 |
(A) Defined EBITDA |  | $ | 87,368 |
As of December 31, 2015 |  |  |  |
Total long-term debt, including current maturities |  | $ | 349,509 |
Unamortized debt issuance costs |  |  | 2,046 |
(B) Defined indebtedness |  | $ | 351,555 |
Leverage Ratio (B)/(A) |  |  | 4.02 |
The following table sets forth the computation of the Fixed Charge Coverage Ratio as of December 31, 2015 (in thousands, except for ratios):
For the Twelve Months ended December 31, 2015 |  |  |
Defined EBITDA |  | $ | 87,368 |
Cash paid for income taxes |  |  | 13,792 |
Capital expenditures |  |  | 13,992 |
(A) Defined EBITDA minus capital expenditures & cash income taxes |  | $ | 59,584 |
Cash interest payments |  | $ | 9,721 |
Dividends |  |  | 90 |
Scheduled principal payments |  |  | 38,666 |
(B) Fixed Charges |  | $ | 48,477 |
Fixed Charge Coverage Ratio (A)/(B) |  |  | 1.23 |
The following table sets forth the computation of the Asset Coverage Ratio as of December 31, 2015 (in thousands, except for ratios):
Credit facility outstanding balance |  | $ | 172,147 |
Outstanding letters of credit |  |  | 6,305 |
Defined indebtedness |  | $ | 178,452 |
Accounts receivable (net), valued at 85% of gross |  | $ | 138,486 |
Inventory, valued at 65% of gross |  |  | 67,482 |
|  | $ | 205,968 |
Asset Coverage Ratio |  |  | 1.15 |
As of December 31, 2015, the maturities of long-term debt for the next five years and thereafter were as follows (in thousands):
2016 |  | $ | 50,829 |
2017 |  |  | 63,356 |
2018 |  |  | 63,381 |
2019 |  |  | 173,055 |
2020 |  |  | 934 |
Thereafter |  |  | - |

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
Name: | us-gaap_DebtDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration