Hardwoods Distribution Inc. has received a commitment from its existing lender Bank of America, N.A. (the Lender) for an increase in the size of its existing senior secured credit facility (the ExpandedCredit Facility) from its current size of $525 million to a new aggregate facility amount of up to $900 million. The Expanded Credit Facility is expected to include (i) a revolving credit facility of up to $500 million which can be drawn upon in U.S. dollars and Canadian dollars, and (ii) a term loan of up to $400 million. The Expanded Credit Facility is expected to bear interest at a rate equal to (a) Term SOFR plus (i) the applicable spread adjustment for the relevant tenor and (ii) up to 2.25% or (b) the base rate of interest charged by the Lender under the Expanded Credit Facility from time to time (Base Rate).

The Term SOFR and Base Rate margins for the Expanded Credit Facility are expected to be subject to performance pricing adjustments, from time to time, based on the Company's then applicable leverage ratio. The financial covenants under the Expanded Credit Facility are expected to include, among others: (i) a consolidated interest coverage ratio (a ratio of adjusted EBITDA to total interest expense, determined on a consolidated basis of the Company, with the specific definitions to be agreed upon) and (ii) a consolidated leverage ratio (a ratio of total funded debt to adjusted EBITDA, determined on a consolidated basis of the Company, with the specific definitions to be agreed upon). The commitment and advance of the loan facilities are subject to usual conditions including, among others, execution of documents satisfactory to the Lender, completion of the related transactions on terms satisfactory to the Lender, no material adverse change in the business of the Company and its subsidiaries or the sellers of Mid-Am having occurred, delivery of certain interim financial statements, pro forma financial statements and a pro forma compliance certificate confirming compliance with financial covenants and borrowing base on a pro forma basis, receipt of all necessary consents for the Acquisition and completion of the Lender's due diligence.