EXHIBIT 10.1
THIRD AMENDMENT TO CREDIT AGREEMENT
THIS THIRD AMENDMENT TO CREDIT AGREEMENT (this "Amendment"), dated
effective as of June 8, 2001, is among ENCOMPASS SERVICES CORPORATION, a Texas
corporation (formerly Group Maintenance America Corp., the "Company"), 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") THE CHASE
MANHATTAN BANK (formerly Chase Bank of Texas, National Association),
individually as a Bank and as Syndication Agent, FIRST UNION NATIONAL BANK,
individually as a Bank and as Documentation Agent, and BANK OF AMERICA, N.A.,
individually as a Bank ("Bank of America") and as Administrative Agent for the
other Banks (in such capacity, together with any other Person who becomes the
administrative agent, the "Administrative Agent").
The Company, the Banks, the Syndication Agent, the Documentation Agent and the
Administrative Agent have entered into that certain Credit Agreement dated as of
February 22, 2000 (as amended, restated, or modified from time to time, the
"Credit Agreement").
The Company has requested that the Credit Agreement be amended in certain
respects, and the Banks party hereto are willing to comply with such request
subject to the terms and provisions of this Amendment.
NOW, THEREFORE, BE IT RESOLVED, THAT, in consideration of the premises
herein contained and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE 1
DEFINITIONS
Section 1.1 Definitions. Capitalized terms used in this Amendment, to the
extent not otherwise defined herein, shall have the same meanings as in the
Credit Agreement, as amended hereby.
ARTICLE 2
AMENDMENTS
Section 2.1 Amendments to Section 1.01.
(a) The following definitions appearing in Section 1.01 of the Credit
Agreement are hereby amended to read in their entirety as follows:
"Agreement" means this Agreement, as it may be amended from time to
time.
"Qualified High Yield Offerings" means one or more Designated
issuances after June 8, 2001 and on or before September 1, 2001, of
subordinated, unsecured debt securities by the Company and/or one or more
of its Subsidiaries (which may be guaranteed by the Company and any of its
Subsidiaries on a subordinated basis) in an
aggregate principal amount not to exceed $200,000,000 at any one time
outstanding the terms of which are substantially identical to the BOSC
Senior Subordinated Notes Indenture or are otherwise consented-to by the
Majority Banks and that have (a) a maturity date after the Term Loan
Maturity Date or the Tranche C Term Loan Maturity Date and (b) an average
life to maturity greater than that of the Term Loans (as of the date of
each such Qualified High Yield Offering).
(b) The following additional definitions are added to Section 1.01 of
the Credit Agreement to appear therein in their proper alphabetical order
and to read in their entirety as follows:
"Approving Banks" means Banks executing the Third Amendment and
returning it to the Administrative Agent by 5:00 p.m. on June 12, 2001.
"Designated" means that the Company has given the Administrative Agent
a Designation Notice.
"Designation Notice" means a written notice from the Company to the
Administrative Agent to the effect that it desires to consummate Qualified
High Yield Offerings and incur Indebtedness pursuant to Section 7.03(o) of
this Agreement, which notice shall set out in detail the terms and
conditions of the proposed Qualified High Yield Offerings.
"Third Amendment" means the Third Amendment to this Agreement dated as
of June 8, 2001.
Section 2.2 Amendment to Section 2.07. Section 2.07 of the Credit Agreement
is amended by adding the following clause thereto:
"(vi) Prepayments from Qualified High Yield Offerings. Not later than
the third Business Day following the date of receipt of the proceeds from
Qualified High Yield Offerings, Borrower shall make a prepayment in respect
of the Revolving Loans equal to the Net Proceeds thereof. Prepayments made
pursuant to this clause (vi) shall not constitute a permanent reduction of
the Revolving Loan Commitments."
Section 2.3 Amendment to Section 7.13. Section 7.13 of the Credit Agreement
is amended by deleting therefrom the words: "$60,000,000 or six percent (6%)"
and inserting in lieu thereof the words "$80,000,000 or eight percent (8%)."
ARTICLE 3
RATIFICATIONS, REPRESENTATIONS AND WARRANTIES
Section 3.1 Ratifications. The terms and provisions set forth in this
Amendment shall modify and supersede all inconsistent terms and provisions set
forth in the Credit Agreement and except as expressly modified and superseded by
this Amendment, the terms and provisions of the Credit Agreement and the other
Loan Documents are ratified and confirmed and shall continue in full force and
effect. The Company and the Banks agree that the Credit Agreement as amended
hereby and the other Loan Documents shall continue to be legal, valid, binding
and enforceable
THIRD AMENDMENT TO CREDIT AGREEMENT 2
in accordance with their respective terms, except, in each case, as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer or other similar laws relating to or affecting
the enforcement of creditors' rights generally, and by general principles of
equity regardless of whether such enforceability is sought in a proceeding in
equity or at law.
Section 3.2 Representations and Warranties. The Company hereby represents
and warrants to the Banks that (i) the execution, delivery and performance of
this Amendment and any and all other Loan Documents executed and/or delivered in
connection herewith have been authorized by all requisite action on the part of
the Company and will not violate the certificate or articles of incorporation,
other organizational documents or bylaws of the Company or any Guarantor; (ii)
the representations and warranties contained in the Credit Agreement, as amended
hereby, and any other Loan Document are true and correct in all material
respects on and as of the date hereof as though made on and as of the date
hereof (except to the extent that such representations and warranties were
expressly, in the Credit Agreement, made only in reference to a specific date);
and (iii) no Default or Event of Default has occurred and is continuing.
ARTICLE 4
MISCELLANEOUS
Section 4.1 Conditions to Effectiveness. This Amendment shall be effective
upon the execution hereof by the Company, Majority Banks and the Administrative
Agent and upon delivery to the Administrative Agent of each of the following
documents:
(a) Designation Notice. The Company shall have given a Designation
Notice.
(b) Consent of Majority Banks; Payment of Fee. (i) If the Qualified High
Yield Offering is other than substantially identical to the BOSC Senior
Subordinated Notes Indenture, the Majority Banks shall have consented in
writing to the Qualified High Yield Offerings described in the Designation
Notice and (ii) the Company shall have paid to the Administrative Agent for
the ratable account of the Approving Banks a fully earned, non-refundable
fee for the Third Amendment equal to five basis points times the
Commitments of the Approving Banks.
(c) Resolutions. Resolutions of the board of directors or other
appropriate body of the Company and each Subsidiary certified by its
Secretary or an Assistant Secretary or other analogous officer or
representative which authorize the execution, delivery and performance by
such Person of this Amendment and such other Loan Documents to be executed
in connection herewith to which it is or is to be a party;
(d) Incumbency Certificate. A certificate of incumbency certified by the
Secretary or an Assistant Secretary or other analogous officer or
representative of the Company and each Subsidiary certifying as to the name
of each officer or other representative of such Person (i) who is
authorized to sign this Amendment or any Loan Documents to which such
Person is or is to be a party (including any certificates contemplated
herein), together with specimen signatures of each such officer or other
representative, and (ii) who will, until replaced by other officers or
representatives duly authorized for that purpose, act as its representative
for the purposes of signing
THIRD AMENDMENT TO CREDIT AGREEMENT 3
documents and giving notices and other communications in connection with
the Loan Documents and the transactions contemplated thereby;
(e) Articles or Certificates of Incorporation, etc. Certified copies of
any amendments of or other changes to the articles or certificates of
incorporation, certificate of formation, certificate of limited
partnership, partnership agreement or other analogous constitutional
document of the Company since May 10, 2000, certified by the Secretary of
State or other applicable Governmental Authority of the state or other
jurisdiction of incorporation or organization of the Company and dated as
of a current date;
(f) Bylaws. Certified copies of any amendments of or other changes to
the bylaws or other analogous constitutional document of the Company since
May 10, 2000, certified by the Secretary or an Assistant Secretary or other
analogous officer or representative of such Person;
(g) Government Certificates. Certificates of appropriate officials as to
the existence and good standing, status or compliance, as applicable, of
the Company in its jurisdiction of incorporation or organization and any
and all jurisdictions where the Company is qualified to do business as a
foreign corporation or other entity, each such certificate to be dated as
of a current date;
(h) Payment of Fees and Expenses. The Company shall have paid all fees
and expenses of or incurred by the Administrative Agent and its counsel to
the extent billed on or before the date hereof and payable pursuant to this
Amendment;
(i) No Prohibitions. No Governmental Requirement shall prohibit the
consummation of the transactions contemplated by this Amendment or any
other Loan Document to be delivered in connection herewith, and no order,
judgment or decree of any Governmental Authority or arbitrator shall, and
no litigation or other proceeding shall be pending or threatened which
would, enjoin, prohibit, restrain or otherwise adversely affect the
consummation of the transactions contemplated by this Amendment or the
other Loan Documents to be delivered in connection herewith;
(j) Opinion of Counsel. Opinion addressed to the Administrative Agent
and the Banks from Xxxxxxxxx & Xxxxxxxxx, L.L.P. and the General Counsel to
the Company, as to such matters as the Administrative Agent may reasonably
request; and
(k) Proceedings Satisfactory. All matters and proceedings taken in
connection with this Amendment and the other Loan Documents to be delivered
in connection herewith shall be reasonably satisfactory to the
Administrative Agent and its counsel.
Borrower shall deliver, or cause to be delivered, to the Administrative Agent
sufficient counterparts of each agreement, document or instrument to be received
by the Administrative Agent under this Section 4.1 to permit the Administrative
Agent to distribute a copy of the same to each Lender.
Section 4.2 Survival of Representations and Warranties. All representations
and warranties made in this Amendment or any other Loan Document including any
Loan Document furnished in connection with this Amendment shall survive the
execution and delivery of this Amendment and the other Loan Documents, and no
investigation by the Banks or the
THIRD AMENDMENT TO CREDIT AGREEMENT 4
Administrative Agent shall affect the representations and warranties or the
right of the Banks or the Administrative Agent to rely upon them.
Section 4.3 Reference to Credit Agreement. Each of the Loan Documents,
including the Credit Agreement and any and all other agreements, documents, or
instruments now or hereafter executed and delivered pursuant to the terms hereof
or pursuant to the terms of the Credit Agreement as amended hereby, are hereby
amended so that any reference in such Loan Documents to the Credit Agreement
shall mean a reference to the Credit Agreement as amended hereby.
Section 4.4 Expenses of Agent. As provided in the Credit Agreement, the
Company agrees to pay on demand all costs and expenses incurred by the
Administrative Agent in connection with the preparation, negotiation, and
execution of this Amendment and the other Loan Documents executed pursuant
hereto.
Section 4.5 Severability. Any provision of this Amendment held by a court
of competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provision so held to be invalid or unenforceable.
Section 4.6 Applicable Law. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND THE APPLICABLE
LAWS OF THE UNITED STATES OF AMERICA.
Section 4.7 Successors and Assigns. This Amendment is binding upon and
shall inure to the benefit of the Company, the Banks and the Administrative
Agent and their respective successors and assigns, except that the Company may
not assign or transfer any of its rights or obligations hereunder without the
prior written consent of the Banks.
Section 4.8 Counterparts. This Amendment may be executed in one or more
counterparts, and on telecopy counterparts each of which when so executed shall
be deemed to be an original, but all of which when taken together shall
constitute one and the same agreement.
Section 4.9 Effect of Waiver. No consent or waiver, express or implied, by
the Banks to or for any breach of or deviation from any covenant, condition or
duty by the Company or any Guarantor shall be deemed a consent or waiver to or
of any other breach of the same or any other covenant, condition or duty.
Section 4.10 Headings. The headings, captions, and arrangements used in
this Amendment are for convenience only and shall not affect the interpretation
of this Amendment.
Section 4.11 ENTIRE AGREEMENT. THIS AMENDMENT AND ALL OTHER INSTRUMENTS,
DOCUMENTS AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH THIS
AMENDMENT EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND
SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND
UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THIS AMENDMENT, AND MAY NOT
BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT
ORAL AGREEMENTS OR
THIRD AMENDMENT TO CREDIT AGREEMENT 5
DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE
PARTIES HERETO.
Section 4.12 Reaffirmation of Guaranty. The undersigned Guarantors of the
obligations of the Company to the Banks under the Credit Agreement and the other
Loan Documents each hereby: (i) consents to the execution and delivery of the
foregoing Amendment, (ii) agrees that the Amendment shall not limit or diminish
the obligations of the undersigned under the Credit Agreement as Guarantors,
(iii) reaffirms its obligations under its guaranty and (iv) agrees that the
Guaranty remains in full force and effect and is hereby ratified and confirmed.
[Signature Pages Follow]
THIRD AMENDMENT TO CREDIT AGREEMENT 6
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized as of the date
first above written.
THE COMPANY:
ENCOMPASS SERVICES CORPORATION
By: /s/ XXXX X. XXXXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President
GUARANTORS:
-----------
A-1 Mechanical of Lansing, Inc.
(successor by merger to New Construction Air Conditioning, Inc.)
AA Advance Air, Inc.
XX Xxxx, Inc.
A-ABC Appliance, Inc.
A-ABC Services, Inc.
Air Conditioning, Plumbing & Heating Service Co., Inc.
Aircon Energy Incorporated
Air Systems, Inc.
Airtron, Inc. (successor by merger to Air Conditioning Engineers, Inc.)
Airtron of Central Florida, Inc.
American Air Company, Inc.
AMS Arkansas, Inc. (formerly Arkansas Mechanical Services, Inc.)
Atlantic Industrial Constructors, Inc.
B&R Electrical Services, Inc.
Xxxx Electric Corp.
Building One Commercial, Inc.
(formerly Xxxxx Building Maintenance Company)
Building One Service Solutions, Inc.
(successor by merger to D&P Janitorial, Inc. and
Direct Engineered Maintenance, Inc.)
BUYR, Inc.
Xxxxxxxx Xxxxx Products & Publications, Inc.
Cardinal Contracting Corporation
Central Air Conditioning Contractors, Inc.
Central Carolina Air Conditioning Company
Chapel Electric Co.
Xxxxxxx Xxxxxxxx, Inc.
Xxxxx Xxxxxxxx Electric Service, Inc.
Colonial Air Conditioning Company
Commercial Air Holding Company
Commercial Air, Power and Cable, Inc.
Conch Republic Corp.
Continental Electrical Construction Co.
Costa and Rihl, Inc.
THIRD AMENDMENT TO CREDIT AGREEMENT 7
Xxxxxxx Brothers, Inc.
Cramar Electric, Inc.
X.X. Xxxx Construction Co., Inc.
Del-Air Service Company, Inc.
Delta Innovations, Ltd., a limited liability company,
by Xxxx Companies Incorporated, its sole member
Divco, Inc.
Diversified Management Services U.S.A., Inc.
Dynalink Corporation
EDG Power Group, Inc.
EET Holdings, Inc.
Electrical Contracting, Inc.
Electrical Design & Construction, Inc.
Engineering Design Group, Inc.
Encompass Electrical Technologies Central Tennessee, Inc.
(formerly Xxxxxxxx Electric, Inc.)
Encompass Electrical Technologies Eastern Tennessee, Inc.
(formerly Advent Electric Co., Inc.)
Encompass Electrical Technologies - Florida, LLC,
by EET Holdings, Inc., its sole member
Encompass Electrical Technologies Georgia, Inc.
(formerly Regency Electric Company Atlanta Office, Inc.)
Encompass Electrical Technologies Jacksonville, Inc.
(formerly All Service Electric, Inc.)
Encompass Electrical Technologies North Carolina, Inc.
(formerly Regency Electric Company Charlotte Office, Inc.)
Encompass Electrical Technologies North Florida, Inc.
(formerly Regency Electric Company Jacksonville Office, Inc.)
Encompass Electrical Technologies of Nevada, Inc.
(formerly Potter Electric Co., Inc., successor by merger to
TSE Acquisition Corp.)
Encompass Electrical Technologies of New England, Inc.
Encompass Electrical Technologies Projects Group, Inc.
(formerly Regency Electric Company Projects Group, Inc.)
Encompass Electrical Technologies South Carolina, Inc.
(formerly Atlantic Electric Company, Inc.)
Encompass Electrical Technologies Southeast, Inc.
(formerly Regency Electric Company, Inc.)
Encompass Electrical Technologies Western Tennessee, Inc.
(formerly Regency Electric Company Memphis Office, Inc.)
Encompass Electrical Technologies of Texas, Inc.
(formerly Xxxxxx Engineering, Inc., successor by merger
to Electrical Associates of Dallas, Inc., Xxxxxxxx
Electrical Contractors, Inc. and MH Technologies, Inc.)
Encompass Facility Services, Inc.
(formerly GroupMAC Facility Services, Inc.)
Encompass Global Technologies, Inc.
(formerly GroupMAC Maryland Corp.)
THIRD AMENDMENT TO CREDIT AGREEMENT 8
Encompass Mechanical Services Southeast, Inc.
(formerly Xxxx Mechanical Company , Inc., successor by merger
to Statewide Heating & Air Conditioning, Inc.)
Encompass Plumbing, Inc.
(formerly Costa and Rihl Plumbing, Inc.)
Encompass Services Holding Corp. (formerly GroupMAC Holding Corp.)
Encompass Services Indiana L.L.C. (formerly GroupMac Indiana, L.L.C.)
by Airtron, Inc., Cardinal Contracting Corporation, Xxxx X. Xxxxx
Co., Inc., and Xxxx Companies Incorporated, its sole members
Encompass Ind./Mech. of Texas, Inc.
(formerly Trinity Contractors, Inc., successor by merger to
Mechanical Interiors, Inc. and K&A Mechanical, Inc.)
ESR PC, L.P., by Conch Republic Corp., general partner
Xxxxx Services, Inc.
XxxxxxxxXxxxxx.xxx, LLC,
by Building One Service Solutions, Inc., its sole member
The Farfield Company
Xxxxxxxx Electric Corporation
Xxxx Xxxxx Electrical Contractor, Inc.
Gamewell Mechanical, Inc.
Garfield-Indecon Electrical Services, Inc.
Xxxxxxx Mechanical Contractors, Inc.
Xxxxxxx Electric, Inc.
GroupMAC Texas, L.P.,
by Encompass Services Holding Corp., general partner
Gulf States, Inc.
(successor by merger to Brazosport Management, Inc.,
G.S. Financial, Inc., G.S. Group, Inc., G.S.I. of California, Inc.
and Testronics, Inc.)
Hallmark Air Conditioning, Inc.
HPS Plumbing Services, Inc.
Xxxxxxxxxx Mechanical Corporation
HVAC Services, Inc. (formerly Noron, Inc.)
Hydro Cooling, Inc.
Interstate Building Services, L.L.C.,
by Building One Service Solutions, Inc., its sole member
Isla Morada, LLC, by Conch Republic Corp., its sole member
Xxxx Mechanical Services, L.L.C.,
by Encompass Mechanical Services Southeast, Inc., its sole
member
K&N Plumbing, Heating and Air Conditioning, Inc.
Xxxxx'x, Inc.
The Xxxxx Companies, Inc.
Lexington/Xxxx Mechanical Company, L.L.C.,
by Encompass Mechanical Services Southeast, Inc., its sole
member
Linford Service Co.
L.T. Mechanical, Inc.
XxxXxxxxx-Xxxxxx Co., Inc.
THIRD AMENDMENT TO CREDIT AGREEMENT 9
XxxXxxxxx-Xxxxxx Industries, Inc.
XxxXxxxxx-Xxxxxx of Oregon, Inc.
XxxXxxxxx-Xxxxxx Service, Inc.
Masters, Inc.
Mechanical Services of Orlando, Inc.
Xxxxxxx Island Air & Heat, Inc.
National Network Services, Inc.
Oil Capital Electric, Inc.
Omni Mechanical Company
Omni Mechanical Services,
by Omni Mechanical Company, general partner
Pacific Rim Mechanical Contractors, Inc.
Xxxx X. Xxxxx Co., Inc.
Phoenix Electric Company
Pro Wire Security Systems, Inc.
Ray and Xxxxxx Xxxxxxx, Inc.
Regency Electric Company South Florida Office, Inc.
Reliable Mechanical, Inc.
Riviera Electric of California, Inc.
Xxxxxxxx Mechanical Company
(successor by merger to X.X. Xxxxxxx Air Conditioning, Inc. and
Valley Wide Plumbing and Heating, Inc.)
Xxxxxxxx Electric Corp.
Xxxx Companies Incorporated
Xxxxxxx Bros., Inc. (successor by merger to XxXxxxxx Mechanical, Inc.)
Sequoyah Corporation
Xxxxxx Services, Incorporated
SKC Electric, Inc.
SKCE, Inc.
S.L. Page Corporation
Xxxxxx Mechanical
Southeast Mechanical Service, Inc.
Xxxxxxx X. Xxxxxxx, Inc.
Sterling Air Conditioning, Inc.
Sun Plumbing, Inc.
Xxxxxx-Xxxx Electric, Inc. (formerly Xxxxxx Electric, Inc.)
Team Mechanical, Inc.
Tower Electric Company
(successor by merger to Xxxxxx X. Xxxxx & Sons, Inc.)
Town & Country Electric, Inc.
Tri-City Electrical Contractors, Inc.
Tri-M Corporation
(formerly Tri-M Electrical Construction Corp., successor by
merger to Tri-M Building Automation Systems Corp.,
Tri-M Corporation, and Tri-M Holding Corp.)
Tri-State Acquisition Corp.
United Acquisition Corp.
United Service Alliance, Inc.
Van's Comfortemp Air Conditioning, Inc.
THIRD AMENDMENT TO CREDIT AGREEMENT
Vantage Mechanical Contractors, Inc.
Vermont Mechanical, Inc.
Xxxx'x Heating & Cooling, Inc.
Xxxxxx Electrical Construction Co.
Xxxxxxx & Sons, Inc.
Xxxxxx Refrigeration, Air Conditioning & Heating, Inc.
Xxxxxx Electric Company, Inc.
(successor by merger to Xxxxxxxx Electronic Communications, Inc.)
Yale Incorporated
By: /s/ XXXX X. XXXXX
-------------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
Acting on Behalf of Each of the Above
Encompass Management Co. (formerly
GroupMAC Management Co. and successor
by merger to Building One Mechanical Services, Inc.)
By: /s/ XXXX X. XXXXX
-------------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President
Encompass Electrical Technologies - Rocky Mountains, Inc.
(formerly Riviera Electric Construction Co., successor
by merger to Xxxxx, Inc.)
By: /s/ XXXXXX X. XXXX
-------------------------------------
Name: Xxxxxx X. Xxxx
Title: Vice President
ChiP Corp.
Wayzata, Inc.
By: /s/ XXXXX XXXXXX
-------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
THIRD AMENDMENT TO CREDIT AGREEMENT
