GIC 10-K & 10-Q changes, risk factors and insider trading

Historically, we source a substantial portion of our products from manufacturers that are located in China. While China sourced products have been reduced in recent years since the expansion of Section 232 and 301 tariffs in 2019, China still represents the largest concentration of country of origin goods. Further, our exposure to other international sourcing has expanded. This concentration exposes us to risks associated with doing business globally, including changes in tariffs. The Office of the United States Trade Representative previously identified certain Chinese imported goods for additional tariffs to address China’s trade policies and practices. In earlyThroughout 2025, the current administration has signaled and implemented a number of additional measures under trade policy, including the potential imposition of blanket tariffs against goods sourced in Mexico and Canada under the Authority of the International Emergency Economic Powers Act ("IEEPA"), reciprocal tariffs on the import of goods from other countries that charge tariffs on imports of US produced goods and expanded tariffs on steel and aluminum imports, along with certain derivative products which contain these raw materials. These tariffs could have a material adverse effect on our business and results of operations. Additionally, the current administration has canceled tariff exclusions that provided tariff relief to certain products and has yet to signal whether it will reinstate such exclusions or further alter existing trade agreements and terms between China and the U.S., including limiting trade with China, adjusting the current tariffs on imports from China and potentially imposing other restrictions on exports from China to the U.S. Consequently, it is possible that tariffs may be imposed on products imported from foreign countries, including China, or that our business will be affected by retaliatory trade measures taken by China or other countries in response to existing or future tariffs. This may cause us to raise prices or make changes to our operations, any of which could have a material adverse effect on our business and results of operations.

In addition, ongoing geopolitical conflicts around the world, including the Russian invasion of Ukraine, the outbreak of armed hostilities in the Middle East and past disruptions in international shipping resulting from attacks by armed groups on cargo ships in the Red Sea, and the responses of the international community, mayhave adversely affectaffected international business and economic conditions. DueWe tohave in the ongoing conflict in and around the Red Sea, we havepast experienced increases to our shipping costs,costs from these conditions, and we may continue to experience elevated shipping costs in the future. The short and long-term implications of global security issues are difficult to predict at this time. The imposition of sanctions and counter sanctions may have an adverse effect on energy and economic markets generally and could result in an even greater impact related to global supply chain and energy prices. In addition, a prolonged war in Ukraine and the Middle East, and continued shipping disruptions in the Red Sea may have adverse impacts on cyber security, global supply chains, inflationary pressures and interest rates and engender volatility in commodities and other markets, any of which could negatively affect our business. The disruption to regional and global economies could have an enduring impact on regional and global economies, and consequently, a materially adverse impact on our operations and profitability. However, due to the highly uncertain and dynamic nature of these events, it is not currently possible to estimate with any reliable measure of certainty the impact on our business.

As a public company, we are required to establish and periodically evaluate and assess procedures with respect to our internal control over financial reporting. In connection with our year-end assessment as part of this Annual Report, we determined that, as of December 31, 2024,2025, wethe didCompany’s disclosure controls and procedures were effective for the core Global Industrial business and not maintain effective internalfor controlits oversubsidiary financialIndoff reportingLLC. dueIndoff torepresents approximately 13% of Revenue. The conclusion regarding Indoff LLC reflects material weaknesses we identified in the design and operation of certain key Information Technology General Controls (“ITGCs”), relevantspecifically related to ourchange keymanagement, accounting,segregation reporting,of duties, and proprietaryprivileged informationaccess. technologyThese ("IT")material systems,weaknesses aswere moreinitially fullyidentified describedduring Management’s evaluation and assessment of Indoff LLC’s control environment in Itemthe 9A,second "Controls and Procedures"quarter of this Form 10-K.2024. These material weaknesses did not result in any identified misstatements to the financial statements, and there were no changes to previously issued financial results. However, if we are unable to remediate this matter we cannot guarantee this will be the case in future periods.

The Company has substantially completed the wind-down activities related to the NATG business, although certain NATG activities related to sublet facilities continue. The Company expects that total additional NATG exit costs incurred during 20242026 orwill laterbe mayimmaterial aggregate up to $0.5 million, whichand will be presented in discontinued operations. In 2023, we executed a sublease agreement for the full remaining term of thea former warehouse lease. In the event, the sub lessee is unable to fulfill its obligations, we would be responsible for the remaining rents due under the lease.

•We may encounter difficulties with acquisitions, including our recent Indoff acquisition,acquisitions and other strategic transactions which could harm our business.

On April 28, 2025, the Company completed the acquisition of an equipment service provider and, as previously reported, on May 19, 2023 the Company acquired 100% of the outstanding equity interests of Indoff. There can be no assurance that such integrationintegrations will occur on the expected timeframe or at all, or that we will realize the anticipated benefits and synergies from thisthese or any other future acquisition.acquisitions. Furthermore, our estimates regarding the earnings, operating cash flow, capital expenditures and liabilities resulting from thisthese or any future acquisitionacquisitions may prove to be incorrect.

To integrate acquired businesses, we must implement our management information systems, operating systems and internal controls, and assimilate and manage the personnel of the acquired operations. The difficulties of this integration may be further complicated by geographic distances. The integration of acquired businesses, including Indoff,businesses may not be successful, may take longer or be more difficult or time-consuming or costly to accomplish than anticipated and could result in disruption to other parts of our business. These and other factors could harm our ability to achieve anticipated levels of profitability at acquired operations or realize other anticipated benefits of an acquisition, and could adversely affect our consolidated business and operating results and could result in disruption to other parts of our business.

Global Industrial Company, through its subsidiaries, is a value-added industrial distributor ofand hundredssource of thousands offor industrial equipment and MRO productssupplies in North America going to market through a system of branded e-commerce websites and relationship marketers.

The Company acquired 100% of the outstanding equity interests of Indoff, a business-to-business direct marketer of material handling products, commercial interiors and business products with operations in North America, on May 19, 2023 for approximately $72.6 million in cash. This acquisition expands the Company's presence in the MRO market in North America. The Indoff accounts are included in the accompanying consolidated financial statements from the date of acquisition. SeeThis Noteacquisition 4, Acquisition, of Notes to Consolidated Financial Statements for additional financial information regardingexpands the acquisition.Company's presence in the maintenance, repair and operations ("MRO") market in North America.

The Company sellsspecializes in providing maintenance, repair and operations solutions to businesses ranging from small to enterprise, and to the public sector. The Company is committed to its customer-centric strategy and uses industry expertise, products from its own Global Industrial Exclusive BrandsTM , and nationally known brands to provide customers with a wide arraybreadth of industrialofferings andto MROmeet products,their which are marketed in North America.needs. These industrial and MRO products are manufactured by other companies. Some products are manufactured for us and sold as a white label product, and some are manufactured to our own design and marketed as private brand products under the trademarks: Global™, GlobalIndustrial.com™, Nexel™, Paramount™, Interion™ and Absocold™.

The Northmarket Americanfor the sale of industrial products marketin North America is highly fragmented and weis competecharacterized against companies inby multiple distribution channels. Industrial products distribution is working capital intensive, requiring us to incur significant costs associated with the warehousing of many products, including the costs of maintaining inventory, leasing warehouse space, inventory management systems and employing personnel to perform the associated tasks. We supplement our on-hand product availability by maintaining relationships with major distributors and manufacturers, utilizing a combination of stock and drop-shipment fulfillment.

The Company has elected to omit discussion of the earliest year presented, December 31, 2022,2023, in MD&A. This discussion can be found in Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in Form 10-K for the year ended December 31, 2023,2024, filed on MarchFebruary 12,26, 2024.2025.

•Consolidated sales increased 3.3%4.8% to $1.32$1.38 billion in U.S. dollars compared to $1.27$1.32 billion last year. Excluding Indoff, sales declined 0.6% as compared to the year ago period and 0.5% on an average daily sales basis*.increased 3.2% compared to prior year.

•Consolidated gross margin increased to 34.335.5 % compared to 34.2%34.3% last year. Excluding Indoff, gross margin was 36.0% compared to 35.5% in the year ago period.

•Consolidated operating income from continuing operations decreasedincreased 16.6%21.2% to $97.6 million compared to $80.5 million compared to $96.5 million last year. Excluding Indoff, operating income was $73.9 million, a decrease of 18.6%.

•Net income per diluted share from continuing operations decreasedincreased 14.7%17.8% to $1.85 compared to $1.57 compared to $1.84 last year.

*Average daily sales is calculated based upon the number of selling days in each period, with Canadian sales converted to U.S. dollars using the current year's average exchange rate. There were 253257 selling days in the U.S. in 2025 compared to 253 selling days in 2024 and 2023in andCanada, there were 254 selling days in 2025 compared to 250 selling days in Canada in 2024 and 2023.2024.

The Company's net sales increased 3.3%4.8% to $1.38 billion compared to $1.32 billion compared to $1.27 billion in 2023,2024, benefiting from lastprice year'scapture, Indoffstrong acquisitionsales onfrom Mayour 19,largest 2023strategic accounts and strongvolume top line growthimprovement in the firstsecond half of 2024. As we continued through the year, resultspartially softenedoffset asby wea experienced continued weaknessreduction in our core smallsmaller and medium businesstransactional customer base.sales. ExcludingU.S. sales contributedincreased by4.7% Indoff,in full year and average daily sales decreased 0.6% and 0.5%, respectively,2025 compared to prior year. U.S. sales, including Indoff, increased 3.5% compared to the full year of 20232024 and Canada sales declined 1.0%. Canada sales increased 0.4%7.0%, 9.2% in local currency in 2025 compared to 2024.

There were 253257 selling days in the U.S. in 2025 compared to 253 in 2024 and 2023 and 250254 selling days in Canada in 20242025 andcompared 2023.to 250 selling days in 2024.

Gross margin is dependent on variables such as product mix including sourcing and category, trade policy inclusive of the imposition of tariffs, competition, pricing strategy, vendor volume rebates, freight pricing decisions including the use of free or other promotional freight plans, freight cost inflation including both domestic outbound freight as well as international inbound ocean freight, inventory valuation and obsolescence and other variables, any or all of which may result in fluctuations in gross margin.

Management of our margin profile remains a key area of focus for the Company. Performance will continue to reflect the impact of proactivestrategic promotion and freight actions as part of our competitive pricing initiatives, tariff related actions and ocean freight costs, which remain volatile and elevated. Consolidated gross margin will continue to also be impacted by Indoff's lower gross margin profile.costs. The Company continues to anticipate that there may alsobe experienceincreased margin variability in future periods due togiven the currenttiming economicdynamics environment,of on-hand inventory, inflationary pressures associated with tariff related cost increases and our efforts to continue to diversify our supply chain as well as historical seasonality.

SELLING, DISTRIBUTIONGENERAL, AND ADMINISTRATIVE EXPENSES (“SDSG&A”)

Selling, distributiongeneral and administrative expenses totaled $371.5$392.6 million and $339.3$371.5 million for the years ended December 31, 20242025 and 2023,2024, respectively.

Interest and other expense, net from continuing operations was $0.1 million for 2025 and $0.2 million for 2024 and $1.1 million for 2023. In 2023, these expenses reflect the outstanding loan balance, utilized to partially fund the Indoff acquisition in May 2023, which were repaid in the third quarter of 2023.2024. The Company also recorded foreign exchange income of approximately $0.1 million in 2025 and foreign exchange losses of approximately $0.5 million in 2024 and $0.2 million in 2023.2024.

Our primary liquidity needs are to support working capital requirements in our business, funding recently declared and any future dividends, funding capital expenditures and inventory purchases, continuing investment in upgrading and expanding our technological capabilities specifically related to additional functionality and enhanced navigation of our new web platform, continuing investment in sales, marketing, merchandising, customer service and upgrading our distribution footprint and funding acquisitions. We rely upon operating cash flow and our credit facility to meet these needs. We currently believe that current cash on hand,hand and cash flow from operations and our availability under our credit facility will be sufficient to fund our working capital and other cash requirements for at least the next twelve months. We believe our current capital structure and cash resources are adequate for our internal growth initiatives. To the extent our growth initiatives expand, including major acquisitions, we would seek to raise additional capital. We believe that, if needed, we can access public or private funding alternatives to raise additional capital.

Our working capital increased $28.6$33.8 million primarily related to higher cashcash, accounts receivable and inventory balances, lowerpartially offset by higher accounts payable, accrued expenses and other current liabilities balances offset by lower accounts receivable balances. Accounts receivable days outstanding were 37.738.9 in 20242025 compared to 37.337.7 in 2023.2024. Inventory turns were 5.1 in 2025 compared to 5.2 in 2024 compared to 5.3 in 2023 and accounts payable days outstanding were 48.446.3 in 20242025 compared to 50.048.4 in 2023.2024. We expect that future accounts receivable, inventory and accounts payable balances will fluctuate with net sales and the product mix of our net sales.

Net cash provided by operating activities from continuing operations was $50.7$77.7 million attributable to cash generated from net income adjusted by other non-cash items which provided $72.7$88.6 million in 20242025 compared to $85.3$72.7 million provided in 2023. This decrease is2024 primarily thedue resultto ofhigher lowernet income in 2024 offset by increased depreciation2025 and amortizationhigher expenses.stock-based Incompensation addition,expense. changesChanges in our working capital accounts used $22.3$10.9 million in 20242025 compared to $26.7$22.3 million providedused in 2023,2024, primarily the result of changes in inventoryinventory, accounts payable, accrued expenses, other current liabilities and other liabilities and accounts payablereceivable balances. Net cash provided by operating activities from discontinued operations was $0.1 million in 2025 and $0.3 million in 2024 and 0.0 million in 2023.2024.

Net cash used in financing activities was $36.7 million in 2024 and $29.7 million in 2023. In 2024, net cash used in financing activities primarily related to the regular quarterly dividend of $0.25 per common share which totaled $38.4 million. Offsetting these payments were proceeds of $1.8 million from the issuance of common stock from stock option exercises, offset by payments for payroll taxes through shares withheld, which totaled approximately $1.6 million and proceeds of $1.5 million from the issuance of common stock from our employee stock purchase plan. In 2023, net cash used in financing activities primarily related to the regular quarterly dividend of $0.20 per common share which totaled $30.6 million and net repayments of short-term borrowings of $0.6 million. Offsetting these payments, were net proceeds of $0.1 million from the issuance of common stock from stock option exercises, net of payments for payroll taxes through shares withheld of approximately $0.5 million and proceeds of $1.4 million from the issuance of common stock from our employee stock purchase plan The Company maintains a $125.0 million secured revolving credit facility with one financial institution, which has a five year term, maturing on October 19, 2026 and provides for borrowings in the United States. The credit agreement contains certain operating, financial and other covenants, including limits on annual levels of capital expenditures, availability tests related to payments of dividends and stock repurchases and fixed charge coverage tests related to acquisitions. The revolving credit agreement requires that a minimum level of availability be maintained. If such availability is not maintained, the Company will be required to maintain a fixed charge coverage ratio (as defined). The borrowings under the agreement are subject to borrowing base limitations of up to 85% of eligible accounts receivable and the inventory advance rate computed as the lesser of 65% or 85% of the net orderly liquidation value (“NOLV”). Borrowings are secured by substantially all of the Borrower’s assets, as defined, including all accounts, accounts receivable, inventory and certain other assets, subject to limited exceptions, including the exclusion of certain foreign assets from the collateral. The interest rate under the amended and restated facility is computed at applicable market rates based on the Secured Overnight Financing Rate ("SOFR"), the Federal Reserve Bank of New York (“NYFRB”) or the Prime Rate, plus an applicable margin. The applicable margin varies based on borrowing base availability. As of December 31, 2024,2025, eligible collateral under the credit agreement was $125.0 million, total availability was $122.2$122.1 million, total outstanding letters of credit was $1.7$1.6 million, total excess availability was $120.5 million and there were no outstanding borrowings. The Company was in compliance with all of the covenants of the credit agreement in place as of December 31, 2024.2025.

In the past we have engaged in opportunistic acquisitions, choosing to pay the purchase price in cash, and may do so in the future as favorable situations arise. However, a deep and prolonged period of reduced business spending could adversely impact our cash resources and force us to either forego future acquisition opportunities or to pay the purchase price using stock, debt or a combination of consideration which could have an adverse effect on our earnings. We believe that our cash balances and future cash flows from operations and availability under our credit facility will be sufficient to fund our working capital and other cash requirements for at least the next twelve months.

We are obligated under non-cancelable operating and finance leases for the rental of our facilities and certain of our equipment which expire at various dates through 2034. As of December 31, 20242025 we were obligated for approximately $83.1$123.7 million under these non-cancelable operating leases. In 20252026 we anticipate cash expenditures of approximately $18.4$21.4 million for these operating leases. We have sublease agreements for unused space, as well asas, excess space in facilities we are currently occupying, in the United States and Canada. In the event the sub lessee is unable to fulfill its obligations, we would be responsible for remaining rents due under the leases.

The Company will record a contract liability in cases where customers pay in advance of the Company satisfying its performance obligation which typically occurs within a year of receipt. The Company had approximately $4.1$3.0 million of contract liabilities as of December 31, 20242025 and $3.3$4.1 million as of December 31, 2023.2024, and was recorded as deferred revenue in Accrued expenses and other current liabilities in the accompanying Consolidated Balance Sheets..

There were no material changes to the Company’s risk factors during the firstsecond quarter ended MarchJune 31,30, 2026.

The results of discontinued operations in the accompanying financial statements are from the former North American Technology ("NATG") business. InAs previously disclosed, in March 2026 the CompanyCompany's discontinued operations received a refund of prior years alternative minimum taxes paid of approximately $1.8 million which was partially offset by an increased tax obligation recorded in the first quarter of 2026.

We continue to closely monitor the macroeconomic and geopolitical environment, including developmentsthe in theongoing Middle East conflict and their impact on transportation and manufacturing costs, as well as the evolving tariff landscape and potential new Section 301 tariffs which arebecame currentlyeffective beingin evaluatedJuly by the US Government.2026. Our goal is to continue to mitigate these disruptions to our business and our customers and we believe we are well-positioned to do so as we continue to proactively manage price and other factors within our control; however, we anticipate headwinds willmay impact margin performance in the spring and summer as fuel prices remain elevated.

There were no material changes in the Company’s significant accounting policies during the firstsecond quarter ended MarchJune 31,30, 2026.

Highlights from Q1Q2 2026 and Year to Date Q2 2026 compared to Q1Q2 2025 and Year to Date Q2 2025

FirstSecond Quarter 2026 Financial Summary:

•Consolidated operating income from continuing operations increased 13.2%47.2% to $20.6$49.3 million compared to $18.2$33.5 million last year. Second quarter 2026 operating income results include a benefit of approximately $21.1 million of IEEPA tariff refunds.

•Net income per diluted share from continuing operations increased 11.4%47.7% to $0.39$0.96 compared to $0.35$0.65 last year. Second quarter 2026 net income per diluted share results include an after tax benefit of approximately $16.4 million, or $0.42 per diluted share, related to the IEEPA tariff refunds.

*Average daily sales is calculated based upon the number of selling days in each period, with Canadian sales converted to U.S. dollars using the current year's average exchange rate. There were 6563 selling days in the U.S. in the firstsecond quarter of 2026 compared to 64 selling days in the firstsecond quarter of 2025.2025 and there were 128 selling days in the U.S. for the six months ended June 30, 2026 and 2025, respectively. There were 63 selling days in Canada in each of the firstsecond quarters of 2026 and 2025, respectively, and there were 126 selling days in Canada for the six months ended June 30, 2026 and 2025, respectively.

Three and Six Months Ended MarchJune 31,30, 2026 compared to the Three and Six Months Ended MarchJune 31,30, 2025

The Company's net sales increased 9.2%7.7% to $350.4$386.6 million during the quarter ended MarchJune 31,30, 2026 compared to $321.0$358.9 million last year. For the six months ended June 30, 2026, net sales increased 8.4% to $737.0 million compared to $679.9 million last year. Net sales benefited from both price and volume, with broad based gains across bothour assignedsales channels and customer verticals. Assigned accounts andincreased e-commercelow salesdouble channels,digits, andled continued strong performance fromby our largest and most strategic accounts. U.S. sales increased 8.1%6.3% for the second quarter of 2026 compared to the same period in 2025 and Canadayear to date sales increased 30.3%,7.1% 24.4%compared to prior year. Our Canadian business continued its strong contribution with increased sales of 34.1%, 33.7% in local currency, and on32.3%, 29.3% in local currency, for the three and six months ended June 30, 2026, respectively. On an average daily sales basis, sales grew 7.6%,9.3% in-linefor with our fourththe quarter performance.ended June 30, 2026 and 8.4% for the six months ended June 30, 2026.

Management of our margin profile remains a key area of focus for the Company. Performance will continue to reflect the impact of strategicproduct promotionmix, fluctuations in transportation costs and freightother actionsinflationary aspressures partwhich can create variability from quarter to quarter. Our pricing, sales and merchandising teams remain focused on mitigating the effects of these macroeconomic impacts on our competitive pricing initiatives, tariff related actions and ocean freight costs.customers. The Company anticipates that there may also be increased margin variability in future periods given the timing dynamics of on-hand inventory, inflationary pressures associated with tariff related cost increases and our efforts to continue to diversify our supply chain and historical seasonality.

Operating margin for the three monthand periodsix months ended MarchJune 31,30, 2026 increased 20350 basis points and 190 basis points, respectively, compared to the same period in 2025 driven by increased sales, increased gross margin due to the salestariff increase,refunds modest declinerecorded in grossthe margin,second continuedquarter, strong general and discretionary cost control offset by increased variablesales compensationcommissions expense relateddue to performance.performance and increased salary and healthcare costs.

Interest and other (income) expense, net from continuing operations was $0.1$1.0 million incomeand $0.3 million for the three months ended MarchJune 31,30, 2026 and $0.12025, respectively, and $1.1 million expenseand $0.2 million for the threesix month periodsmonths ended MarchJune 31,30, 2025.2026 and 2025, respectively. The increase in interest and other income (expense), net was primarily related to interest on IEEPA refunds recorded in the second quarter of 2026 of $1.1 million.

For the three month period ended MarchJune 31,30, 2026 and March 31, 2025, the Company reported income taxes in continuing operations of approximately $5.4$13.2 million and $4.6$8.7 million, respectively, related to its U.S., Canada and India operations including tax expense for certain U.S. states. For the six month period ended June 30, 2026 and 2025, the Company reported income taxes in continuing operations of approximately $18.6 million and $13.3 million, respectively, related to its U.S., Canada and India operations including tax expense for certain U.S. states.

InAs previously disclosed, in March 2026 the CompanyCompany's discontinued operations received a refund of prior years alternative minimum taxes paid of approximately $1.8 million related to our NATG discontinued operations. This refund was partially offset by an increased tax obligation recorded in the first quarter of 2026.

Our primary liquidity needs are to support working capital requirements in our business, funding recently declared and any future dividends, funding capital expenditures and inventory purchases, continuing investment in upgrading and expanding our technological capabilities specifically related to additional functionality and enhanced navigation of our web platform, continuing investment in sales, marketing, merchandising, customer service and upgrading our distribution footprint and funding acquisitions. We rely principally upon operating cash flow.flow and our credit facility to meet those needs. We currently believe that current cash on hand andhand, cash flow from operations and our availability under our credit facility will be sufficient to fund our working capital and other cash requirements for at least the next twelve months. We believe our current capital structure and cash resources are adequate for our internal growth initiatives. To the extent our growth initiatives expand, including major acquisitions, we would seek to raise additional capital. We believe that, if needed, we can access public or private funding alternatives to raise additional capital.

Our working capital increased $7.7$31.0 million primarily related to increased accountscash receivable,balances, including $15.3 million of IEEPA refunds received in the second quarter of 2026, increased accounts payablereceivable andbalances, inventoryincluding balances$10.9 million of IEEPA refunds receivable, offset by increased accrued expenses and other current liabilitiesliabilities, balancesaccounts andpayable, reduced cash and cash equivalents,inventory and prepaid expenses and other current assets balances. Accounts receivable days outstanding were 38.639.7 in 2026 compared to 38.439.0 in 2025, inventory turns were 5.25.3 in 2026 compared to 5.0 in 2025 and accounts payable days outstanding were 44.044.2 in 2026 compared to 48.947.7 in 2025. We expect that future accounts receivable, inventory and accounts payable balances will fluctuate with net sales and the product mix of our net sales.

Net cash provided by operating activities from continuing operations was $4.7$46.0 million in 2026 compared to $3.3$35.1 million provided in 2025, attributable to cash generated from net income adjusted by other non-cash items of $19.2$60.5 million compared to $17.9$46.4 million generated in 2025 primarily due to the higher net income and reduced stock-based compensation expenses in 2026 from the IEEPA refunds recorded compared to prior year. Changes in working capital accounts used $14.5 million in 2026 compared to $14.6$11.3 million used in 2025, primarily the result of the changes in inventory, accounts receivable, accrued expenses, other current liabilities and incomeother taxeslabilities balancesbalanced offset by changes in inventory, accounts payable and income taxes balances. Net cash provided by operating activities from discontinued operations was $1.7$1.8 million and $0.1$0.0 million for the threesix months ended MarchJune 31,30, 2026 and March 31, 2025, respectively.

Net cash used in investing activities in 2026 totaled $0.8$1.7 million primarily used for warehouse machinery and equipment for distribution facilities, motor vehicles, leasehold improvementsimprovements, andcomputer software, computer hardware and molds. Net cash used in investing activities totaled $0.2$5.6 million in 2025 of which $4.0 million was used for the equipment service provider acquisition and $1.6 million was used for warehouse machinery and equipment for distribution facilities, computer equipment upgrades and molds.

Net cash used in financing activities totaled $11.3$26.8 million in 2026 primarily related to the regular quarterly dividends of $0.28 per common share which totaled approximately $10.8$21.6 million.million and $5.6 million used for the purchase of treasury stock. Offsetting these payments were proceeds of $0.9 million from the issuance of common stock from our employee stock purchase plan and proceeds of $0.4 million from the issuance of common stock from stock option exercises, offset by payments for payroll taxes through shares withheld, which totaled $0.9 million. In addition, $0.9 million was used for the purchase of treasury stock. In 2025, net cash used in financing activities totaled $8.8$18.9 million primarily related to the regular quarterly dividends of $0.26 per common share which totaled approximately $10.1$20.1 million. Offsetting these payments were proceeds of $1.2 million from the issuance of common stock from stock option exercises, offset by payments for payroll taxes through shares withheld, which totaled $0.7$0.8 million, and proceeds of $0.8 million from the issuance of common stock from our employee stock purchase plan.

The Company maintains a $125.0 million secured revolving credit facility with one financial institution,institution. whichOn hasJune a30, five2026, yearthe Company extended this facility for an additional five-year term, maturing on OctoberJune 19,30, 20262031. andThe facility provides for borrowings in the United States. The credit agreement contains certain operating, financial and other covenants, including limits on annual levels of capital expenditures, availability tests related to payments of dividends and stock repurchases and fixed charge coverage tests related to acquisitions. The revolving credit agreement requires that a minimum level of availability be maintained. If such availability is not maintained, the Company will be required to maintain a fixed charge coverage ratio (as defined). The borrowings under the agreement are subject to borrowing base limitations of up to 85% of eligible accounts receivable and the inventory advance rate computed as the lesser of 65% or 85% of the net orderly liquidation value (“NOLV”). Borrowings are secured by substantially all of the Borrower’s assets, as defined, including all accounts, accounts receivable, inventory and certain other assets, subject to limited exceptions, including the exclusion of certain foreign assets from the collateral. The interest rate under the amended and restated facility is computed at applicable market rates based on the Secured Overnight Financing Rate (“SOFR”), the Federal Reserve Bank of New York (“NYFRB”) or the Prime Rate, plus an applicable margin. The applicable margin varies based on borrowing base availability. As of MarchJune 31,30, 2026, eligible collateral under the credit agreement was $125.0 million, total availability was approximately $121.5$121.4 million, total outstanding letters of credit was $1.6 million, and total excess availability was $119.9$119.8 million. The Company was in compliance with all of the covenants of the credit agreement as of MarchJune 31,30, 2026.

We maintain our cash and cash equivalents in money market funds or their equivalents that have maturities of less than three months and in non-interest bearing accounts that partially offset banking fees. As of MarchJune 31,30, 2026, we had no investments with maturities of greater than three months. Accordingly, we do not believe that our cash balances have significant exposure to interest rate risk. At MarchJune 31,30, 2026 cash balances held in foreign subsidiaries totaled approximately $5.0$7.3 million. These balances are held in local country banks and are held primarily to support local working capital needs. The Company had over $176$199 million of liquidity (cash and undrawn line of credit) in the U.S. as of MarchJune 31,30, 2026.

We are obligated under non-cancelable operating and finance leases for the rental of our facilities and certain of our equipment which expire at various dates through 2034. As of MarchJune 31,30, 2026 we were obligated for approximately $117.9$117.3 million under these non-cancelable leases. In 2026 we anticipate remaining cash expenditures of approximately $16.1$9.1 million for these operating leases. We have sublease agreements for unused space, as well as excess space in facilities we are currently occupying in the United States and Canada. In the event the sub lessee is unable to fulfill its obligations, we would be responsible for remaining rents due under the leases.

Our purchase and other obligations consist primarily of purchase commitments for certain employment, consulting and service agreements. In addition to the previously mentioned commitments, at MarchJune 31,30, 2026, we had $1.6 million of standby letters of credit outstanding.