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EXHIBIT 10.3
FIRST AMENDMENT TO SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
ENTERED INTO by and between SERVICE EXPERTS, INC., a Delaware
corporation (the "Borrower"), SUNTRUST BANK, NASHVILLE, N.A., AGENT ("Agent"),
SUNTRUST BANK, NASHVILLE, N.A. ("STB"), BANK OF AMERICA, FSB ("BOA"), SOUTHTRUST
BANK, NATIONAL ASSOCIATION ("SB"), NATIONSBANK, N.A. ("Nations"), and FIRST
AMERICAN NATIONAL BANK ("FANB") (herein STB, BOA, SB, Nations, and FANB shall
collectively be referred to as "Lenders") as of this 30th day of September,
1998.
RECITALS:
1. The Borrower, the Agent, and the Lenders entered into a Second
Amended and Restated Credit Agreement dated April 28, 1998 (herein the "Credit
Agreement").
2. The Borrower, the Agent, and the Lenders desire to amend the Credit
Agreement as set forth herein.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt and adequacy of which is hereby
acknowledged, the Borrower, the Agent, and the Lenders agree as follows:
1. The definition of "Applicable Margin" as set forth in Article I of
the Credit Agreement is hereby amended and restated as follows:
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RATIO OF TOTAL FUNDED DEBT TO EBITDA
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Purpose < = 1.0x >1.0x but < = >1.5x but < = >2.0x but < = >2.5x
- 1.5x - 2.0x - 2.5x -
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Facility Fee 17.5 basis 20 basis 25 basis 37.5 basis 45 basis
Percentage points per points per points per points per annum points per
annum annum annum annum
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Calculation of 45 basis 67.5 basis 75 basis 87.5 basis 105 basis
LIBOR points per points per points per points per points per
Option and annum annum annum annum annum
Letter of
Credit Fee
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2. The definition of "Commitment Fee" as set forth in Article I of, as
used in, the Credit Agreement is hereby amended to mean Facility Fee.
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3. Article I of the Credit Agreement is hereby amended to include the
following new definition:
"Facility Fee" has the same meaning as set forth in Section 2.16
herein.
4. Section 2.01(a) of the Credit Agreement shall be amended and
restated as follows:
(a) Availability. Subject to the conditions and pursuant to
the terms of the Loan Documents and in reliance upon the
representations, warranties, and covenants set forth in the Loan
Documents, each Lender severally agrees to make Advances (relative to
such Lender) to the Borrower under the Revolving Credit Loan equal to
such Lender's Pro Rata share of the Advance requested to be made on
such day (herein its "Revolving Credit Loan Commitment") (excluding
Advances requested under the Swing Line Loan), provided that in no
event shall any Lender be permitted to fund an amount under its
Revolving Credit Loan Commitment (including its Pro Rata Share of
outstanding Letters of Credit), plus any outstanding Competitive Bid
Loans, plus any outstanding Swing Line Loans owing to such Lender in
excess of its Pro Rata Share of the Maximum Total Amount.
5. Section 2.04(h) of the Credit Agreement shall be amended and
restated in its entirety as follows:
(h) Any Lender's Competitive Bid Rate Advance shall reduce
such Lender's obligation to lend its Pro Rata Share of the remaining
unused commitments.
6. Section 2.16 of the Credit Agreement shall be amended and restated
as follows:
Section 2.16 Facility Fee. On the first Business Day following
the end of each Fiscal Quarter thereafter (or if such day is not a
Business Day, then on the next succeeding Business Day) and on the
Maturity Date, the Borrower shall pay to the Agent on or before 1:00
p.m. (Nashville, Tennessee time) for distribution upon receipt promptly
thereafter to the Lenders based on their Pro Rata Share a Facility Fee
equal to: (a) the Maximum Total Amount (without taking into account
usage) multiplied by: (b) the Applicable Margin then in effect for the
Facility Fee calculation for the Fiscal Quarter (or portion thereof),
divided by (c) four(4).
7. Section 7.01(f) of the Credit Agreement shall be amended and
restated as follows:
(f) Seller Notes not to exceed $50,000,000 in the aggregate
outstanding principal balance at any one time;
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6. The introductory paragraph to Section 7.03 of the Credit Agreement
shall be amended and restated as follows:
Section 7.03 Investments, Loans, and Advances. Make or permit
to remain outstanding any loans or advances to or investments in any
Person in an aggregate amount in excess of the lesser of (i) an amount
equal to five percent (5%) of the Consolidated Net Worth of the
Consolidated Entities, or (ii) $20,000,000, except that, subject to all
other provisions of this Article, the foregoing restriction shall not
apply to:
7. Article VIII shall be amended to include new Section 7.14 to read as
follows:
Section 7.14 Prepayment of Seller Notes. Prepay Seller Notes
in the aggregate amount in excess of $1,000,000 in any twelve (12)
month period without obtaining the written consent of the Majority
Lenders.
8. The Credit Agreement is not amended in any other respect.
9. The Borrower reaffirms the provisions of the Credit Agreement, and
agrees that its obligations are valid and binding, enforceable in accordance
with its terms, subject to no defense, counterclaim, or objection.
ENTERED INTO as of this 30th day of September, 1998.
BORROWER:
SERVICE EXPERTS, INC.
By:
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Title:
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AGENT:
SUNTRUST BANK, NASHVILLE, N.A., Agent
By:
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Title:
-------------------------------------
Address: 000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
[Signatures Continued on Next Page]
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LENDERS:
SUNTRUST BANK, NASHVILLE, N.A.
By:
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Title:
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Address: 000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
[Signatures Continued on Next Page]
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BANK OF AMERICA, FSB
By:
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Title:
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Address: 0000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
[Signatures Continued on Next Page]
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SOUTHTRUST BANK, NATIONAL
ASSOCIATION
By:
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Title:
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Address: 000 Xxxxxx Xxxxxx Xxxxx,
0xx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
[Signatures Continued on Next Page]
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NATIONSBANK, N.A.
By:
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Title:
---------------------------------
Address: 000 X. Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Pro Rata Share: 12 1/2%
[Signatures Continued on Next Page]
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FIRST AMERICAN NATIONAL BANK
By:
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Title:
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Address:4th & Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, Xxxxxxxxx 00000-0000
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