EXHIBIT 10.63
COMFORT SYSTEMS USA, INC.
FIRST AMENDMENT TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "AMENDMENT") is dated
as of January 14, 1999 and entered into by and among COMFORT SYSTEMS USA, INC.,
a Delaware corporation (the "COMPANY"), the other Credit Support Parties (as
defined in Section 4 hereof), the Subsidiaries of the Company listed on the
signature pages hereto as Guarantors (together with each other Person who
subsequently becomes a Guarantor, collectively the "GUARANTORS"), the banks and
other financial institutions listed on the signature pages hereto under the
caption "BANKS" (together with each other Person who becomes a Bank,
collectively the "BANKS"), BANK ONE, TEXAS, N.A. individually as a bank ("BOT")
and as administrative agent for the other Banks (in such capacity together with
any other Person who becomes the administrative agent, the "ADMINISTRATIVE
AGENT"), BANKERS TRUST COMPANY, individually as a Bank ("BTCO") and as
syndication agent for the other Banks (in such capacity together with any other
Person who becomes the syndication agent, the "SYNDICATION AGENT"), and NATIONS
BANK, N.A., individually as a Bank ("NB") and as documentation agent for the
other Banks (in such capacity together with any other Person who becomes the
documentation agent, the "DOCUMENTATION AGENT"); and together with the
Administrative Agent and the Syndication Agent, the "AGENTS"), CREDIT LYONNAIS,
individually as a Bank and Co-Agent, NATIONAL CITY BANK, individually as a Bank
and as Co-Agent, and THE BANK OF NOVA SCOTIA, individually as a Bank and as
Co-Agent (collectively, the "CO-AGENTS"), and is made with reference to that
certain Third Amended and Restated Credit Agreement dated as of December 14,
1998, by and among the Company, the Guarantors, the Banks, the Administrative
Agent, the Syndication Agent, the Documentation Agent, and the Co-Agents (the
"CREDIT AGREEMENT"), and to other Loan Documents. Capitalized terms used herein
without definition shall have the same meanings herein as set forth in the
Credit Agreement.
RECITALS
WHEREAS, Loan Parties and the Banks desire to amend the Credit
Agreement to permit the Company to make certain other Investments having a cost
to the Company and its Subsidiaries not exceeding $2,000,000 in the aggregate
over the life of the Credit Agreement.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
SECTION 1. AMENDMENT TO THE CREDIT AGREEMENT
1.1 AMENDMENT TO SECTION 8.5: INVESTMENTS
Section 8.5(e) of the Credit Agreement is hereby amended by deleting
the reference to "$500,000" contained therein and substituting "$2,000,000"
therefor.
SECTION 2. CONDITIONS TO EFFECTIVENESS
Section 1 of this Amendment shall become effective only upon the
prior or concurrent satisfaction of all of the following conditions precedent
(the date of satisfaction of such conditions being referred to herein as the
"AMENDMENT EFFECTIVE DATE"):
A. On or before the Amendment Effective Date, the Company shall
deliver to the Banks (or to the Agents for the Banks) the following, each,
unless otherwise noted, dated the Amendment Effective Date:
1. A certificate of the secretary or an assistant secretary of
the Company and of the Guarantors certifying: (i) that the resolutions of
its Board of Directors of the Company and of the Guarantors approving and
authorizing the execution, delivery, and performance of the Credit
Agreement and amendments thereto delivered on the Effective Date, are in
full force and effect and have not been amended, supplemented or otherwise
modified since December 14,1998 and (ii) that the signature and incumbency
certificates of the officers of each of the Company and of the Guarantors
delivered on the Effective Date, are in full force and effect and have not
been amended, supplemented or otherwise modified since December 14, 1998;
and
2. Counterparts of this Amendment executed by the Requisite
Banks and each of the other parties hereto.
B. On or before the Amendment Effective Date, all corporate and
other proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by the Agents, acting on behalf of the Banks, and their counsel shall
be satisfactory in form and substance to the Agents and such counsel, and the
Agents and such counsel shall have received all such counterpart originals or
certified copies of such documents as the Agents may reasonably request.
SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce the Banks to enter into this Amendment and to
amend the Credit Agreement in the manner provided herein, the Company and each
other Loan Party party hereto represents and warrants to each Bank that the
following statements are true, correct and complete as to itself:
A. CORPORATE POWER AND AUTHORITY. Each Loan Party party hereto has
all requisite corporate power and authority to enter into this Amendment and to
carry out the transactions contemplated hereby and the Company and each other
Loan Party party hereto has all requisite corporate power and authority to carry
out the transactions contemplated by, and perform its obligations under, the
Credit Agreement as further amended by this Amendment (the "AMENDED AGREEMENT").
B. AUTHORIZATION OF AGREEMENTS. The execution and delivery of this
Amendment and the performance of the Amended Agreement have been duly authorized
by all necessary corporate action on the part of the Company and each of the
other Loan Parties party hereto, as the case may be.
C. NO CONFLICT. The execution and delivery by each Loan Party party
hereto of this Amendment and the performance by such Loan Party of this
Amendment and the performance by the Company of the Amended Agreement do not and
will not (i) violate any provision of any law or any governmental rule or
regulation applicable to the Company or any of its Subsidiaries, the Certificate
or Articles of Incorporation or Bylaws of the Company or any of its Subsidiaries
or any order, judgment or decree of any court or other agency of government
binding on the Company or any of its Subsidiaries, (ii) conflict with, result in
a breach of or constitute (with due notice or lapse of time or both) a default
any Contractual Obligation of the Company or any of its Subsidiaries, (iii)
result in or require the creation or imposition of any Lien upon any of the
properties or assets of the Company or any of its Subsidiaries (other than any
Liens created under any of the Loan Documents in favor of the Agents on behalf
of the Banks), or (iv) require any approval of stockholders or any approval or
consent of any Person under any Contractual Obligation of the Company or any of
its Subsidiaries.
D. GOVERNMENTAL CONSENTS. The execution and delivery by each Loan
Party party hereto of this Amendment and the performance by such Loan Party of
this Amendment and the performance by the Company of the Amended Agreement do
not and will not require any registration with, consent or approval of, or
notice to, or other action to, with or by, any federal, state or other
governmental authority or regulatory body.
E. BINDING OBLIGATION. This Amendment has been duly executed and
delivered by each Loan Party party hereto and this Amendment and the Amended
Agreement are the legally valid and binding obligations of such Loan Party,
enforceable against such Loan Party in accordance with their respective terms,
except as may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or limiting creditors' rights generally or by
equitable principles relating to enforceability.
F. INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM CREDIT
AGREEMENT. The representations and warranties contained in Article VI of the
Credit Agreement are and will be true, correct and complete in all material
respects on and as of the Amendment Effective Date to the same extent as though
made on and as of that date, except to the extent such representations and
warranties specifically relate to an earlier date, in which case they were true,
correct and complete in all material respects on and as of such earlier date.
G. ABSENCE OF DEFAULT. No event has occurred and is continuing or
will result from the consummation of the transactions contemplated by this
Amendment that would constitute an Event of Default or a Potential Event of
Default.
SECTION 4. ACKNOWLEDGEMENT AND CONSENT
The Company is a party to certain Collateral Documents pursuant to
which the
Company has created Liens in favor of the Agents on certain Collateral to secure
the Obligations. Each of the other Loan Parties party hereto is a party to
certain Collateral Documents and the Guaranty, pursuant to which each such Loan
Party has (i) guarantied the Obligations and (ii) created Liens in favor of the
Agents on certain Collateral to secure the obligations of such Loan Party under
the Guaranty. The Loan Parties party hereto are collectively referred to herein
as the "CREDIT SUPPORT PARTIES", and the Collateral Documents and the Guaranty
are collectively referred to herein as the "CREDIT SUPPORT DOCUMENTS".
Each Credit Support Party hereby acknowledges that it has reviewed
the terms and provisions of the Credit Agreement, the Collateral Documents and
the Guaranty and this Amendment and consents to the further amendment of the
Credit Agreement effected pursuant to this Amendment. Each Credit Support Party
hereby confirms that each Credit Support Document to which it is a party or
otherwise bound and all Collateral encumbered thereby will continue to guaranty
or secure, as the case may be, to the fullest extent possible the payment and
performance of all "Obligations," "Guarantied Obligations" and "Secured
Obligations," as the case may be (in each case as such terms are defined in the
applicable Credit Support Document), including without limitation the payment
and performance of all such "Obligations," "Guarantied Obligations" or "Secured
Obligations," as the case may be, in respect of the Obligations of Company now
or hereafter existing under or in respect of the Amended Agreement and the Notes
defined therein.
Each Credit Support Party acknowledges and agrees that any of the
Credit Support Documents to which it is a party or otherwise bound shall
continue in full force and effect and that all of its obligations thereunder
shall be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Amendment. Each Credit Support Party
represents and warrants that all representations and warranties contained in the
Amended Agreement and the other Credit Support Documents to which it is a party
or otherwise bound are true, correct and complete in all material respects on
and as of the Amendment Effective Date to the same extent as though made on and
as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case they were true, correct
and complete in all material respects on and as of such earlier date.
Each Credit Support Party (other than the Company) acknowledges and
agrees that (i) notwithstanding the conditions to effectiveness set forth in
this Amendment, such Credit Support Party is not required by the terms of the
Credit Agreement or any other Loan Document to consent to the amendments to the
Credit Agreement effected pursuant to this Amendment and (ii) nothing in the
Credit Agreement, this Amendment or any other Loan Document shall be deemed to
require the consent of such Credit Support Party to any future amendments to the
Credit Agreement.
SECTION 5. MISCELLANEOUS
A. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND THE
OTHER LOAN DOCUMENTS.
(i) On and after the Amendment Effective Date, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof",
"herein" or words of like import referring to the Credit Agreement,
and each reference in the other Loan Documents to the "Credit
Agreement", "thereunder", "thereof" or words of like import
referring to the Credit Agreement shall mean and be a reference to
the Amended Agreement.
(ii) Except as specifically amended by this Amendment, the Credit
Agreement and the other Loan Documents shall remain in full force
and effect and are hereby ratified and confirmed.
(iii) The execution, delivery and performance of this Amendment
shall not, except as expressly provided herein, constitute a waiver
of any provision of, or operate as a waiver of any right, power or
remedy of any Agent or any Bank under, the Credit Agreement or any
of the other Loan Documents.
B. FEES AND EXPENSES. Company acknowledges that all reasonable
costs, fees and expenses as described in Section 12.4 of the Credit Agreement
incurred by the Syndication Agent and its counsel with respect to this Amendment
and the documents and transactions contemplated hereby shall be for the account
of the Company.
C. HEADINGS. Section and subsection headings in this Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Amendment for any other purpose or be given any substantive effect.
D. APPLICABLE LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
E. COUNTERPARTS; EFFECTIVENESS. This Amendment may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument; signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are physically attached to the same document. This Amendment (other than the
provisions of Section 1, which shall become effective upon the satisfaction of
each of the conditions set forth in Section 2 hereof) shall become effective
upon the execution of a counterpart hereof by the Requisite Banks and each of
the other parties hereto and receipt by the Company and the Agents f written or
telephonic notification of such execution and authorization of delivery thereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
BORROWER:
COMFORT SYSTEMS USA, INC.
By:/s/______________________________
J. Gordon Beittenmiller
Senior Vice President and
Chief Financial Officer
S-1
GUARANTORS:
ACCURATE AIR SYSTEMS, INC.
ACCU-TEMP LP, INC.
ACCU-TEMP, LLC
ACI MECHANICAL, INC.
ADAMS MECHANICAL SERVICES, INC.
ADAMS MECHANICAL, SERVICES, INC.
AIR POWER SYSTEMS, INC.
AIR POWER SYSTEMS, INC.
AIR SOLUTIONS, INC.
ALLSTATE MECHANICAL, INC.
AMERICAN REFRIGERATION CONTRACTORS, INC.
ARMANI PLUMBING & MECHANICAL
ATLAS AIR CONDITIONING COMPANY
ATLAS COMFORT SERVICES USA, INC.
BATCHELOR'S MECHANICAL CONTRACTORS, INC.
BCM CONTROLS CORPORATION
CEL, INC.
CENTRAL MECHANICAL CONSTRUCTION CO., INC.
CENTRAL MECHANICAL INC.
CLIMATE CONTROL, INC.
CONTRACT SERVICE, INC.
CS44 ACQUISITION CORPORATION
DESIGN MECHANICAL INCORPORATED
DYNASTAR, INC.
E.L. PRUITT COMPANY
EASTERN HEATING & COOLING, INC.
EASTERN REFRIGERATION CO., INC.
EDISON COOLING SYSTEMS, INC.
EDS, INC.
F&G MECHANICAL CORPORATION
FRED HAYES MECHANICAL CONTRACTORS, INC.
FREEWAY HEATING & AIR CONDITIONING, INC.
GMS AIR CONDITIONING, INC.
GOTHAM AIR CONDITIONING SERVICE, INC.
GULFSIDE MECHANICAL, INC.
H & H PLUMBING & HEATING, INC.
HARRIS GENERAL & MECHANICAL
CONTRACTORS, INC.
HELM CORPORATION
HELM CORPORATION SAN DIEGO
HESS MECHANICAL CORPORATION
HILLCREST SHEET METAL, INC.
INDUSTRIAL COOLING INC.
JAMES AIR CONDITIONING ENTERPRISES, INC.
KILGUST MECHANICAL, INC.
KUEMPEL SERVICE, INC.
LAWRENCE SERVICE, INC.
LOWRIE ELECTRIC CO., INC.
MANDELL MECHANICAL CORPORATION
MARTIN HEATING, INC.
MAXIMUM REFRIGERATION & AIR
CONDITIONING CORPORATION
MEADOWLANDS FIRE PROTECTION CORP.
MECHANICAL SERVICE GROUP, INC.
MJ MECHANICAL SERVICES, INC.
NOGLE & BLACK MECHANICAL, INC.
NORTH AMERICAN MECHANICAL, INC.
NORTH JERSEY MECHANICAL CONTRACTORS, INC.
OK SHEET METAL & AIR CONDITIONING, INC.
QUALITY AIR HEATING & COOLING, INC.
RADNEY PLUMBING, INC.
RIVER CITY MECHANICAL, INC.
RIVER CITY MECHANICAL, INCORPORATED
ROSS & ASSOCIATES
S&K AIR CONDITIONING CO., INC.
S. I. GOLDMAN
S.M. LAWRENCE COMPANY, INC.
SALMON & ALDER, INC.
SEASONAIR, INC.
SHAMBAUGH & SON, INC.
SOUTHERN BLUEGRASS MECHANICAL, INC.
STANDARD HEATING & AIR CONDITIONING
COMPANY
SUPERIOR HEATING AND SHEET METAL
COMPANY
TARGET CONSTRUCTION, INC.
TECH HEATING AND AIR CONDITIONING,
INC.
TECH MECHANICAL, INC.
TEMP-RIGHT SERVICE, INC.
TEMPRITE AIR CONDITIONING AND
REFRIGERATION, INC.
THE CAPITAL REFRIGERATION COMPANY
THE FAGAN COMPANY
THE HARVEY ROBBIN COMPANY
TRI-CITY MECHANICAL, INC.
TROOST SERVICE CO.
UNITED ENVIRONMENTAL SERVICES, INC.
WALKER-J-WALKER, INC.
WEATHER ENGINEERING, INC.
WESTERN BUILDING SERVICES, INC.
WOODCOCK & ASSOCIATES, INC.
By: __/s/_____________________________
J. Gordon Beittenmiller
Vice President
ADMINISTRATIVE AGENT/BANK:
BANK ONE, TEXAS, N.A.,
AS ADMINISTRATIVE AGENT AND INDIVIDUALLY,
AS A BANK
By:___/s/_____________________________
Name: _________________________________
Title: __________________________________
SYNDICATION AGENT/ BANK:
BANKERS TRUST COMPANY,
AS SYNDICATION AGENT AND INDIVIDUALLY AS A
BANK
By:_________________________________
Name: ______________________________
Title: _______________________________
DOCUMENTATION AGENT/ BANK:
NATIONSBANK, N.A.,
AS DOCUMENTATION AGENT AND INDIVIDUALLY,
AS A BANK
By:
___/s/__________________________________
Name: __________________________________
Title:__________________________________
CO-AGENT/ BANK:
CREDIT LYONNAIS, NEW YORK BRANCH,
AS CO-AGENT AND INDIVIDUALLY, AS A BANK
By: _____/s/_______________________________
Name: _____________________________________
Title:_____________________________________
CO-AGENT/BANK:
NATIONAL CITY BANK,
AS CO-AGENT AND INDIVIDUALLY, AS A BANK
By:_/s/____________________________________
Michael J. Durbin
Vice President
CO-AGENT/ BANK:
THE BANK OF NOVA SCOTIA,
AS CO-AGENT AND INDIVIDUALLY, AS A BANK
By: /s/__________________________________
Name: ___________________________________
Title:___________________________________
BANK:
THE LONG-TERM CREDIT BANK OF JAPAN, LTD.
By: /s/__________________________________
Name:____________________________________
Title:___________________________________
BANK:
STAR BANK, NATIONAL ASSOCIATION
By: /s/__________________________________
Name:____________________________________
Title:___________________________________
BANK:
UNION BANK OF CALIFORNIA, N.A.
By: /s/__________________________________
Name:____________________________________
Title:___________________________________
BANK:
BANK OF MONTREAL
By: /s/__________________________________
Name:____________________________________
Title:___________________________________
BANK:
SOCIETE GENERALE, SOUTHWEST AGENCY
By: /s/__________________________________
Name:____________________________________
Title:___________________________________
BANK:
COMERICA BANK
By: /s/__________________________________
Name:____________________________________
Title:___________________________________
BANK:
BANK POLSKA, KASA OPIEKI S.A., PEKOA S.A.
GROUP, NEW YORK BRANCH
By: /s/__________________________________
Name:____________________________________
Title:___________________________________
BANK:
LASALLE NATIONAL BANK
By: /s/__________________________________
Name:____________________________________
Title:___________________________________