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FIRST AMENDMENT TO AMENDED AND RESTATED SECURED
REVOLVING AND TERM LOAN AGREEMENT
This First Amendment to Amended and Restated Secured Revolving and Term
Loan Agreement (this "FIRST AMENDMENT") is made and entered into as of the 31st
day of March, 1999, by and among AMERICAN RESIDENTIAL SERVICES, INC., a Delaware
corporation ("BORROWER"); each of the Subsidiaries of Borrower; NATIONSBANK,
N.A., as the Agent, a Revolving Lender, the Swing Line Lender, and the Issuing
Lender; BANK BOSTON, N.A., as the Documentation Agent and a Revolving Lender,
THE PRUDENTIAL INSURANCE COMPANY OF AMERICA, as the Term Lender; and the other
lending institutions which are a party to this First Amendment.
W I T N E S S E T H:
WHEREAS, pursuant to that certain Amended and Restated Secured
Revolving and Term Loan Agreement (the "LOAN AGREEMENT") dated July 2, 1998,
Lenders (as that term is defined in the Loan Agreement and is hereafter used)
agreed to make certain loans to Borrower upon the terms and conditions therein
contained; and
WHEREAS, Borrower and Lenders desire to modify and amend certain terms
and provisions of the Loan Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Borrower and Lenders agree as
follows:
1. Defined Terms. Hereinafter, words and terms used herein which are
defined in the Loan Agreement are used herein as defined therein, except as
specifically modified by the terms of this First Amendment.
2. Conditions Precedent. The obligations of Agent, the Swing Line
Lender, the Issuing Lender, the Documentation Agent, the Term Lender, and the
other Lenders under this First Amendment, and the effectiveness of the
amendments to the Loan Agreement set forth herein, are subject to the full,
complete, and timely satisfaction of each of the following conditions precedent:
(a) Agent shall have received and approved a fully executed
original of this First Amendment, executed by Authorized Officers of
Borrower and each Subsidiary of Borrower and by each Lender;
(b) Agent shall have received an upfront closing fee equal to
$287,500.00 as independent pro rata consideration for each Revolving
Lender's agreement to enter into this First Amendment and an upfront
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closing fee equal to $125,000.00, as independent consideration for the
Term Lender's agreement to enter into this First Amendment;
(c) Borrower shall have agreed to cooperate fully, in a manner
satisfactory to Agent, with an independent third party consultant,
engaged by Agent (at Borrower's sole cost and expense) to review and
analyze for Agent, on behalf of Lenders, the validity of Borrower's
business plan for its fiscal year ending on December 31, 1999, in a
manner and scope determined by Agent;
(d) Borrower shall have reimbursed Agent and Lenders for all
their reimbursable costs and expenses (including without limitation,
attorneys' fees) incurred in connection with the preparation,
negotiation, and execution of this First Amendment and the transaction
described herein, and have paid Agent for all other amounts then due
and owing by Borrower to Lenders under the Loan Agreement and the
Notes;
(e) The representations and warranties contained in Article VI
of the Loan Agreement shall be true and unbreached and no Event of
Default shall have occurred and be then existing (after giving effect
to this First Amendment); and
(f) All legal matters incident to the consummation of the
transactions contemplated under this First Amendment shall be
satisfactory to Messrs. Gardere ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇, L.L.P. special
counsel for Agent and Lenders (including without limitation, delivery
to Agent of all organizational documents and Subsidiary tax
identification numbers required by Agent and its counsel).
The Agent shall, upon satisfaction of the foregoing conditions precedent,
execute and deliver to Borrower a written confirmation that such conditions have
been fully, completely and timely satisfied, and the amendments in Article 3
hereof, and the waivers in Article 6 hereof, are in full force and effect.
3. Amendments to Loan Agreement. Upon the full and complete
satisfaction of each of the conditions precedent listed in Section 2, the Loan
Agreement is amended and modified as follows:
3.1 The definitions of the following terms set forth in Section 1.1 of
the Loan Agreement are deleted in their entirety and the following are
substituted in place thereof:
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"FIXED RATE" means, for Term Loan A, a fixed rate per annum equal to
9.96%.
"INTEREST PERIOD" means, with respect to any LIBOR Rate Loan:
(a) for each calendar month beginning prior to April 1, 2000,
each one month period commencing on the first Business Day of a
calendar month; and
(b) thereafter, with respect to the borrowing, conversion, or
continuations of a LIBOR Rate Loan on or after April 1, 2000, each
period commencing on the last day of the period applicable to such
LIBOR Rate Loan and ending one (1), two (2), three (3), or six (6)
months thereafter, as selected by Borrower in its Rate Designation
Notice pursuant to Section 2.4(e);
provided, that the foregoing provisions are subject to the following:
(i) Borrower may not select an Interest Period
ending on a date later than the applicable Maturity Date;
(ii) any Interest Period that would otherwise end on
a day that is not a Business Day shall be extended to the next
succeeding Business Day, unless the result of such extension
would be to extend such Interest Period into another calendar
month, in which event such Interest Period shall end on the
immediately preceding Business Day;
(iii) any Interest Period which begins on the last
Business Day of a calendar month (or on a day for which there
is no numerically corresponding day in a calendar month at the
end of such Interest Period) shall end on the last Business
Day of the calendar month in which it would have ended if
there were a numerically corresponding day in such calendar
month; and
(iv) no more than five (5) Interest Periods may be in
effect at any time for the Revolving Loan and no more than
four (4) Interest Periods may be in effect at any time for
Term Loan B, provided each Term Loan B tranche shall be in an
amount greater than $1,000,000.00.
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"LIBOR MARGIN" means (a) for the Revolving Loans (i) for the period
from the Closing Date until the initial Reset Date, 2.75%; and (ii) for
any subsequent period beginning with the initial Reset Date, to but not
including, the next Reset Date to occur, if the Consolidated Funded
Debt to Consolidated EBITDA Ratio calculated as of the last day of
Borrower's fiscal quarter immediately preceding the particular Reset
Date is within a range set forth in Column A in Schedule II, the
applicable per annum percentage shall be, subject to adjustment
pursuant to Section 7.12, as set forth for that range in column B in
Schedule II; and (b) for Term Loan B, 4.25%.
"PERMITTED INVESTMENTS" means:
(a) securities with maturities of one (1) year or less from
the date of acquisition issued or fully guaranteed or insured by the
United States Government or any agency thereof;
(b) certificates of deposit and Eurodollar time deposits with
maturities of one (1) year or less from the date of acquisition and
overnight bank deposits of any commercial bank (i) having capital and
surplus in excess of $500,000,000.00 or (ii) which has a short-term
commercial paper rating which satisfies the requirements set forth in
clause (d) of this definition;
(c) repurchase obligations of any commercial bank satisfying
the requirements of clause (b) of this definition, having a term of not
more than thirty (30) days with respect to securities issued, fully
guaranteed or insured by the United States Government or any agency
thereof;
(d) commercial paper rated P-1 by ▇▇▇▇▇'▇ Investors Service,
Inc. or A-1 by Standard & Poor's Ratings Group on the date of
acquisition;
(e) securities with maturities of one (1) year or less from
the date of acquisition insured or fully guaranteed by any state,
commonwealth or territory of the United States or by any political
subdivision or taxing authority of such state, commonwealth or
territory;
(f) securities with maturities of one (1) year or less from
the date of acquisition backed by standby letters of credit issued by
any commercial bank satisfying the requirements of clause (b) of this
definition;
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(g) shares of money market mutual or similar funds which
invest primarily in assets satisfying the requirements of clauses (a)
through (f) of this definition;
(h) time deposits and certificates of deposit in any Lender
and other investments, securities and products offered by any Lender
(including Eurodollar deposits);
(i) loans, advances, extensions of credit and capital
contributions to, and purchases of the Capital Stock of or other
interests in, Subsidiaries of Borrower; and
(j) Acquired Businesses having an Acquisition Date prior to
March 31, 1999, or after March 31, 2000.
"REVOLVING LOAN TOTAL COMMITMENT AMOUNT" means (a) at any time prior to
April 1, 2000, an amount equal to $95,000,000.00; and (b) at any time
thereafter, $115,000,000.00.
3.2 Section 2.1(b) of the Loan Agreement is deleted in its entirety and
the following is substituted in place thereof:
Letters of Credit. Subject to and upon the terms, covenants, and
conditions of this Agreement, the Issuing Lender shall issue Letters of
Credit for the account of Borrower on its behalf or on behalf of any of
its Subsidiaries from time to time for any of the purposes for which
Borrower can obtain a Revolving Loan; provided, that (i) each Letter of
Credit shall be issued on a Business Day, (ii) after the issuance of
any Letter of Credit, (A) the Letter of Credit Exposure, plus the
aggregate outstanding principal balance of the Revolving Loans, plus
the outstanding principal balance of the Swing Line Loans, must be less
than or equal to the Revolving Loan Total Commitment Amount, and (B)
the Letter of Credit Exposure shall not exceed $10,000,000.00, and
(iii) when issued, such Letter of Credit must have an expiry date no
later than the earlier of one (1) year after the issuance date thereof
and four (4) Business Days prior to the Revolving Maturity Date. If the
Agent issues any Letters of Credit with expiration dates that
automatically extend unless the Agent gives notice that the expiration
date will not so extend, the Agent will give such notice of non-renewal
before the time necessary
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to prevent such automatic extension if before such required notice date
(i) the expiration date of such Letter of Credit if so extended would
be later than four (4) Business Days before the Revolving Maturity
Date, (ii) the Revolving Commitments shall have terminated pursuant to
the terms hereof, (iii) a Default or an Event of Default has occurred
and is continuing, or (iv) the Agent is so directed by Borrower.
3.3 The following subparagraph is added to and made a part of Section
2.6 of the Loan Agreement:
(d) Restructuring Fee. Borrower agrees (if the condition
subsequent hereinafter contained is not satisfied) to pay to
the Agent (i) for the account of each Revolving Lender
(ratably in accordance with their respective Revolving Loan
Percentages) a non-refundable restructuring fee (the
"REVOLVING LOAN RESTRUCTURING FEE") on such Revolving Lender's
Revolving Loan Percentage of the average daily Revolving
Commitment during the period beginning April 1, 1999, and
concluding on March 31, 2000 at a per annum rate equal to 2.0%
(0.5% per fiscal quarter of Borrower), calculated on the basis
of a 360-day year for the actual number of days elapsed,
payable in arrears on the first Business Day of each calendar
quarter, commencing July 1, 1999, with a final payment of such
Revolving Loan Restructuring Fee being due and payable on
April 1, 2000, and (ii) for the account of the Term Lender a
non- refundable restructuring fee (the "TERM LOAN
RESTRUCTURING FEE" on the average daily outstanding balances
of the Term Loan during the period beginning April 1, 1999 and
concluding on March 31, 2000 at a per annum rate equal to 2.0%
(0.5% per fiscal quarter of Borrower), calculated on the basis
of a 360-day year for the actual number of days elapsed,
payable in arrears on the first Business Day of each calendar
quarter, commencing July 1, 1999, with a final payment of such
Term Loan Restructuring Fee being due and payable on April 1,
2000; provided, however that the foregoing Revolving Loan
Restructuring Fee and Term Loan Restructuring Fee shall not be
accrued, due, or payable in the event that, prior to June 30,
1999, Borrower has paid Lenders the outstanding balance of
each Revolving Loan and the Term Loan and all other amounts
then owing under the Loan Agreement (including, without
limitation, all amounts due and payable as a result of the
prepayment of the Term Loan), as a result of such payment or
otherwise, and has canceled each Lender's Revolving
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Commitment (and as a result thereof no Lender has any further
funding or other commitment under the Loan Agreement).
3.4 Sections 3.2(a) and (b) of the Loan Agreement are deleted in their
entirety and the following are substituted in place thereof:
(a) Revolving Loans and Swing Line Loans. Interest on the Revolving
Loans and the Swing Line Loans shall be due and payable as it accrues
on the first Business Day of each calendar month, commencing on the
first Business Day of April, 1999, and continuing on the first Business
Day of each successive calendar month thereafter, until the first
Business Day of April, 2000, whereafter, with respect to the portion of
the Revolving Loans which are Variable Rate Loans, such accrued unpaid
interest shall be due and payable on the first Business Day of each
October, January, April and July thereafter, and from and after April
1, 2000, with respect to the portion of the Revolving Loans which are
LIBOR Rate Loans, on the Interest Adjustment Date of each LIBOR Rate
Loan and, if applicable, 90 days after the commencement of a LIBOR Rate
Loan if that date is prior to the Interest Adjustment Date for the
LIBOR Rate Loan, in each case until the Revolving Maturity Date. All
outstanding principal of the Revolving Notes and the Swing Line Note,
together with all accrued and unpaid interest thereon and other amounts
owed with respect thereto, shall be due and payable in full on the
earlier to occur of (i) the Revolving Maturity Date or (ii) the date on
which the Revolving Loans and the Swing Line Loans become due and
payable pursuant to Section 9.2.
(b) Term Loan. Interest on Term Loan A shall be due and
payable as it accrues on the first Business Day of each calendar month,
commencing on the first Business Day of April, 1999, and continuing on
the first Business Day of each successive calendar month thereafter,
until the first Business Day of April, 2000, whereafter such accrued
unpaid interest shall be due and payable on the first Business Day of
each October, January, April and July thereafter. Interest on Term Loan
B shall be due and payable as it accrues on the first Business Day of
each calendar month, commencing on the first Business Day of April,
1999, and continuing on the first Business Day of each successive
calendar month thereafter, until the first Business Day of April, 2000,
whereafter such accrued and unpaid interest shall be due and payable on
each Interest Adjustment Date and if applicable, 90 days after the
commencement of the Interest Period to which the Interest Adjustment
Date relates if that date is prior to that Interest Adjustment Date. In
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addition to interest then due, beginning on the first Business Day of
April, 2000, and continuing on the first Business Day of each
successive July, October, January and April thereafter until the Term
Maturity Date, equal quarterly installments of principal, in the amount
of $3,571,428.57, each, shall be due and payable and applied pro rata
among Term Loan A and Term Loan B. All outstanding principal of each
Term Note, together with accrued and unpaid interest thereon and other
amounts owed with respect thereto, shall be due and payable on the
earlier to occur of (i) the Term Maturity Date, or (ii) the date on
which the Term Loan becomes due and payable pursuant to Section 9.2.
3.5 The following subsection is added to and made a part of Section
7.12 of the Loan Agreement to follow subsection (e) thereof:
Notwithstanding the foregoing, or anything else to the contrary in this
Agreement, Borrower shall not acquire an Acquired Business having an
Acquisition Date during the period commencing on March 31, 1999, and
ending on March 31, 2000.
3.6 The date "November 30, 1999" shall be substituted for "June 30,
1999" wherever it appears throughout Section 7.13 of the Loan Agreement so as to
amend Section 7.13 as aforesaid.
3.7 Section 8.1 of the Loan Agreement is deleted in its entirety and
the following is substituted in place thereof:
Financial Covenants.
(a) Consolidated Net Worth. Borrower shall not permit
Consolidated Net Worth to be less than the Required Minimum at the end
of any fiscal quarter of Borrower. For purposes of this subsection,
"REQUIRED MINIMUM" shall initially mean an amount equal to
$128,104,000.00. At the end of each fiscal quarter (beginning with the
fiscal quarter ending on June 30, 1998), the Required Minimum shall be
adjusted by adding to the Required Minimum calculated as of the end of
the immediately preceding fiscal quarter, an amount equal to (i) the
greater of (x) seventy-five percent (75%) of the Consolidated Net
Income of Borrower for the calendar quarter ending on the date as of
which compliance with this covenant is being measured, or (y) $0; (ii)
proceeds (net of reasonable and customary transaction costs) received
by Borrower during such fiscal quarter from its sale or issuance of any
equity securities of, or any other additions to capital by, Borrower or
its
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Subsidiaries (other than mandatorily redeemable Capital Stock and other
equity instruments the consideration for which is classified otherwise
than as a part of Borrower's Consolidated Net Worth determined in
accordance with GAAP); plus (iii) one hundred percent (100%) of the
stockholder's equity of any Entity acquired in an acquisition for which
Borrower uses the pooling of interest method of accounting in
accordance with GAAP.
(b) Fixed Charge Coverage Ratio. Borrower shall not permit the
Fixed Charge Coverage Ratio (i) at the end of any fiscal quarter of
Borrower ending prior to December 31, 1999, to be less than .85 to 1.0,
and (ii) at the end of any fiscal quarter of Borrower ending on or
after December 31, 1999, to be less than 1.1 to 1.0.
(c) Consolidated Funded Debt to Consolidated Pro Forma EBITDA
Ratio. Borrower shall not permit the Consolidated Funded Debt to
Consolidated Pro Forma EBITDA Ratio to be greater than (i) 8.0 to 1.0
at the end of the fiscal quarter of Borrower ending on September 30,
1999, (ii) 5.25 to 1.0 at the end of any fiscal quarter of Borrower
ending on or after December 31, 1999, and prior to March 31, 2000, and
(iii) 3.75 to 1.0 at the end of any fiscal quarter of Borrower ending
on or after March 31, 2000.
(d) Senior Consolidated Funded Debt to Consolidated Pro Forma
EBITDA Ratio. Borrower shall not permit the Senior Consolidated Funded
Debt to Consolidated Pro Forma EBITDA Ratio to be greater than (i) 4.25
to 1.0 at the end of the fiscal quarter of Borrower ending on ▇▇▇▇▇ ▇▇,
▇▇▇▇, (▇▇) 5.75 to 1.0 at the end of the fiscal quarter of Borrower
ending on June 30, 1999, (iii) 5.25 to 1.0 at the end of the fiscal
quarter of Borrower ending on September 30, 1999, (iv) 3.50 to 1.0 at
the end of any fiscal quarter of Borrower ending on or after December
31, 1999, and prior to March 31, 2000, and (v) 2.75 to 1.0 at the end
of any fiscal quarter of Borrower ending on or after March 31, 2000.
(e) Consolidated GAAP EBITDA to Consolidated Interest Expense
Ratio. Borrower shall not permit the ratio of the Consolidated GAAP
EBITDA of Borrower to the Consolidated Interest Expense of Borrower at
the end of any fiscal quarter of Borrower to be less than 1.5 to 1.0.
(f) Senior Consolidated Funded Debt to Total Capitalization
Ratio. Borrower shall not permit the Senior Consolidated Funded Debt to
Total Capitalization Ratio at the end of any fiscal quarter of Borrower
to be greater than .55 to 1.0.
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(g) Consolidated GAAP EBITDA. Borrower shall not permit its
Consolidated GAAP EBITDA to be less than (i) $5,000,000.00 for the
period beginning on January 1, 1999, and ending on ▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇)
$15,800,000.00 for the period beginning on January 1, 1999, and ending
on June 30, 1999, (iii) $28,000,000.00 for the period beginning on
January 1, 1999, and ending on September 30, 1999, and (iv)
$35,000,000.00 for the period beginning on January 1, 1999, and ending
on or after December 31, 1999.
3.8 Schedule II to the Loan Agreement is deleted in its entirety and
the Schedule II attached to this First Amendment is substituted in place
thereof.
3.9 Exhibit A to the Loan Agreement is deleted in its entirety and the
Exhibit "A" attached to this First Amendment is substituted in place thereof.
4. Year 2000. In addition to the representations and warranties and
covenants and agreements made in the Loan Agreement, Borrower represents and
warrants to, and agrees with, Lender as follows:
(a) Borrower has (i) begun analyzing the operations of
Borrower and its Subsidiaries and Affiliates that could be adversely
affected by failure to become Year 2000 compliant (that is, that
computer applications, imbedded microchips and other systems will be
able to perform date-sensitive functions prior to and after December
31, 1999) and (ii) developed a plan for becoming Year 2000 compliant in
a timely manner, the implementation of which is on schedule in all
material respects. Borrower reasonably believes that it will become
Year 2000 compliant for its operations and those of its subsidiaries
and affiliates on a timely basis except to the extent that a failure to
do so would not reasonably be expected to have a material adverse
effect upon the financial condition of Borrower;
(b) Borrower reasonably believes any suppliers and vendors
that are material to the operations of Borrower or its Subsidiaries and
Affiliates will be Year 2000 compliant for their own computer
applications except to the extent that a failure to do so could not
reasonably be expected to have a material adverse effect upon the
financial condition of Borrower; and
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(c) Borrower will promptly notify Agent and each Lender in the
event Borrower determines that any computer application which is
material to the operations of Borrower, its Subsidiaries or any of its
material vendors or suppliers will not be fully Year 2000 compliant on
a timely basis, except to the extent that such failure would not
reasonably be expected to have a material adverse effect upon the
financial condition of Borrower.
5. Joinder. Each Subsidiary of Borrower joins in the execution and
delivery of this First Amendment to (a) evidence that the Subsidiary Guaranty,
Security Agreement, and other Loan Documents executed by each of them remain in
full force and effect, and are not limited or impaired by the execution and
delivery of this First Amendment, or the occurrence of any other event, and (ii)
to join in and be bound by the releases and other agreements made in Sections 5,
7, 9, and 11 of this First Amendment.
6. Release. Borrower and each of the Subsidiaries on their own behalf
and on behalf of their predecessors, successors and assigns (collectively, the
"RELEASING PARTIES"), hereby acknowledge and stipulate that as of the date of
this Agreement, none of the Releasing Parties has any claims or causes of action
of any kind whatsoever against Agent or any Lender or any of their officers,
directors, employees, agents, attorneys, or representatives, or against any of
their respective predecessors, successors, or assigns. Each of the Releasing
Parties hereby forever releases, remises, discharges and holds harmless Agent
and each Lender and all of their officers, directors, employees, agents,
attorneys and representatives, and all of their respective predecessors,
successors, and assigns, from any and all claims, causes of action, demands, and
liabilities of any kind whatsoever, whether direct or indirect, fixed or
contingent, liquidated or nonliquidated, disputed or undisputed, known or
unknown, which any of the Releasing Parties has or may acquire in the future
relating in any way to any event, circumstance, action, or failure to act from
the beginning of time through the date of this Agreement.
7. Waiver. Borrower has failed to comply with the terms of Section
8.1(c) of the Loan Agreement (Consolidated Funded Debt to Consolidated Pro Forma
EBITDA) and Section 8.1(d) of the Loan Agreement (Senior Consolidated Funded
Debt to Consolidated Pro Forma EBITDA), for any period ending on or prior to
December 31, 1998. At the request of Borrower, upon and subject to the full and
complete satisfaction of each condition precedent listed in Section 2, Agent and
each Lender waive compliance by Borrower with the foregoing described covenants
for such period. The waiver contained in this First Amendment is specifically
limited to a waiver of the foregoing described covenants for the period set
forth herein and the Agent and each Lender agree that Borrower's failure to
comply with such covenants during the periods
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provided for in the preceding sentence, shall not constitute an Event of Default
or a Default. This waiver shall not constitute a waiver of either (a) any
further violation of the foregoing described covenants beyond such period (as
amended hereby), or (ii) any violation (except as expressly described above for
the periods described above) of any other provision of the Loan Agreement, or
any Event of Default thereunder, whether now existing or occurring after the
date of this First Amendment, or (iii) of any right of Agent and Lenders to
require strict compliance with the Loan Agreement, as hereby amended. Agent and
each Lender specifically reserves all of the rights and remedies they may have
under the Loan Agreement or otherwise as the result of any such violation or
Event of Default. This First Amendment constitutes the only evidence of Agent's
and Lenders' waiver of compliance by Borrower with the above described
covenants.
8. ARBITRATION. (a) ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE
PARTIES HERETO INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO
THE LOAN AGREEMENT (AS HEREBY AMENDED) OR ANY RELATED AGREEMENTS OR INSTRUMENTS,
INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL BE
DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION ACT
(OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW). THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF JUDICIAL ARBITRATION AND
MEDIATION SERVICES, INC. (J.A.M.S.), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS FIRST AMENDMENT MAY BRING AN ACTION, INCLUDING A SUMMARY OR EXPEDITED
PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR CLAIM TO WHICH THE LOAN
AGREEMENT (AS HEREBY AMENDED) APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.
(b) SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE
CITY OF THE BORROWER'S DOMICILE AT THE TIME OF THIS FIRST AMENDMENT'S EXECUTION
AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR; IF J.A.M.S. IS
UNABLE OR LEGALLY PRECLUDED FROM ADMIN ISTERING THE ARBITRATION, THEN THE
AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL BE
COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE ARBITRATOR
SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE COM MENCEMENT OF
SUCH HEARING FOR UP TO AN ADDITIONAL 60 DAYS.
(c) RESERVATION OF RIGHTS. NOTHING IN THIS FIRST AMENDMENT
SHALL BE DEEMED TO (i) LIMIT THE APPLICABILITY OF ANY
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OTHERWISE APPLICABLE STATUTES OF LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED
IN THE LOAN AGREEMENT (AS HEREBY AMENDED); OR (II) BE A WAIVER BY AGENT OR ANY
LENDER OF THE PROTECTION AFFORDED TO IT BY 12 U.S.C. SEC. 91 OR ANY
SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE RIGHT OF AGENT OR ANY
LENDER (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED TO) SETOFF,
OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY COLLATERAL, OR (C) TO
OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH AS (BUT NOT LIMITED
TO) INJUNCTIVE RELIEF, WRIT OR POSSESSION OR THE APPOINTMENT OF A RECEIVER.
AGENT AND EACH LENDER MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
AGREEMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES NOR THE INSTITUTION OR
MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL OR ANCILLARY REMEDIES
SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY, INCLUDING THE CLAIMANT IN
ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE CONTROVERSY OR CLAIM OCCASIONING
RESORT TO SUCH REMEDIES.
9. NO CONTROL BY LENDERS. BORROWER AGREES AND ACKNOWLEDGES THAT ALL OF
THE COVENANTS AND AGREEMENTS PROVIDED FOR AND MADE BY BORROWER IN THIS FIRST
AMENDMENT, THE LOAN AGREEMENT, AND IN THE OTHER LOAN DOCUMENTS ARE THE RESULT OF
EXTENSIVE AND ARMS-LENGTH NEGOTIATIONS AMONG BORROWER, AGENT, AND LENDERS.
AGENT'S AND LENDERS' RIGHTS AND REMEDIES PROVIDED FOR IN THE LOAN AGREEMENT AND
IN THE OTHER LOAN DOCUMENTS ARE INTENDED TO PROVIDE AGENT AND LENDERS WITH A
RIGHT TO OVERSEE BORROWER'S ACTIVITIES AS THEY RELATE TO THE LOAN TRANSACTIONS
PROVIDED FOR IN THE LOAN AGREEMENT, WHICH RIGHT IS BASED ON AGENT'S AND LENDERS'
VESTED INTEREST IN BORROWER'S ABILITY TO PAY THE NOTES AND PERFORM THE OTHER
OBLIGATIONS. NONE OF THE COVENANTS OR OTHER PROVISIONS CONTAINED IN THE LOAN
AGREEMENT SHALL, OR SHALL BE DEEMED TO, GIVE AGENT OR ANY LENDER THE RIGHT OR
POWER TO EXERCISE CONTROL OVER, OR OTHERWISE IMPAIR, THE DAY-TO-DAY AFFAIRS,
OPERATIONS, AND MANAGEMENT OF BORROWER; PROVIDED THAT IF AGENT OR ANY LENDER
BECOMES THE OWNER OF ANY STOCK OF ANY ENTITY, WHICH ENTITY OWNS AN INTEREST IN
BORROWER OR ANY SUBSIDIARY, WHETHER THROUGH FORECLOSURE OR OTHERWISE, AGENT AND
EACH SUCH LENDER THEREAFTER SHALL BE ENTITLED TO EXERCISE SUCH LEGAL RIGHTS AS
IT MAY HAVE BY BEING A SHAREHOLDER OF SUCH ENTITY.
-13-
14
10. Lien Continuation: Miscellaneous. The liens granted in the Loan
Documents are hereby ratified and confirmed as continuing to secure the payment
of the Notes. Nothing herein shall in any manner diminish, impair or extinguish
the Notes, as may be modified and increased under the Loan Agreement or the
liens securing the Notes. The liens granted in the Loan Documents are not
waived. Borrower ratifies and acknowledges the Loan Documents as valid,
subsisting, and enforceable and agrees that the indebtedness evidenced by the
Notes is just, due, owing and unpaid, and is subject to no offsets, deductions,
credits, charges or claims of whatsoever kind or character, and further agrees
that all offsets, credits, charges and claims of whatsoever kind or character
are fully settled and satisfied.
11. Representations and Warranties. The representations and warranties
made by Borrower in Article VI of the Loan Agreement are true and correct as of
the date of this First Amendment.
12. Miscellaneous.
12.1 Preservation of the Loan Agreement. Except as specifically amended
and modified by the terms of this First Amendment, all of the terms, provisions,
covenants, warranties, and agreements contained in the Loan Agreement and in the
other Loan Documents shall remain in full force and effect (any irreconcilable
conflicts or inconsistencies between the terms of this First Amendment and the
Loan Agreement, or any other Loan Document, shall be governed and controlled by
this First Amendment).
12.2 Counterparts. This First Amendment may be executed in two or more
counterparts, and it shall not be necessary that any one of the counterparts be
executed by all of the parties hereto. Each fully or partially executed
counterpart shall be deemed an original, but all such counterparts taken
together shall constitute but one and the same instrument.
12.3 NO ORAL AGREEMENTS. THIS WRITTEN AGREEMENT AND THE OTHER WRITTEN
LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NOT UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
-14-
15
IN WITNESS WHEREOF, the parties have executed this First Amendment as
of the date first above written.
BORROWER:
AMERICAN RESIDENTIAL SERVICES,
INC., a Delaware corporation
By:
-------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇
Senior Vice President
LENDERS:
NATIONSBANK, N.A., a national
banking association, as Agent for
Lenders, Swing Line Lender,
Revolving Lender, and Issuing Lender
By:
-------------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇,
Vice President
BANKBOSTON, N.A., as Documentation
Agent and Revolving Lender
By:
-------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇,
Vice President
NATIONAL CITY BANK OF KENTUCKY,
as Revolving Lender
By:
------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.,
Vice President
-15-
16
PARIBAS, as Revolving Lender
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
GUARANTY FEDERAL BANK, F.S.B., as
Revolving Lender
By:
------------------------------
▇▇▇▇ ▇▇▇▇▇,
Vice President
THE FUJI BANK LIMITED, New York
Branch, as Revolving Lender
By:
-------------------------------
▇▇▇▇ ▇▇▇▇▇▇,
Vice President
CREDIT LYONNAIS NEW YORK
BRANCH, as Revolving Lender
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
THE PRUDENTIAL INSURANCE
COMPANY OF AMERICA, as Term Lender
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
AMERICAN MECHANICAL SERVICES
COMPANY, LLC, a Delaware limited
liability company
-16-
17
AMERICAN MECHANICAL SERVICES OF
ARIZONA, INC., a Arizona corporation
AMERICAN MECHANICAL SERVICES OF
CALIFORNIA, INC., a California
corporation
AMERICAN MECHANICAL SERVICES OF
COLORADO, INC., a Colorado corporation
AMERICAN MECHANICAL SERVICES OF
GEORGIA, INC., a Georgia corporation
AMERICAN MECHANICAL SERVICES OF
HOUSTON, INC., a Delaware corporation
AMS MECHANICAL SERVICES , INC., a
Indiana corporation
AMERICAN MECHANICAL SERVICES OF
IOWA, INC., a Iowa corporation
AMERICAN MECHANICAL SERVICES OF
KENTUCKY, INC., a Kentucky corporation
AMERICAN MECHANICAL SERVICES OF
MICHIGAN, INC., a Michigan corporation
AMERICAN MECHANICAL SERVICES
OF MISSOURI, INC., a Missouri
corporation
AMERICAN MECHANICAL SERVICES OF
MONTANA, INC., a Montana corporation
AMERICAN MECHANICAL SERVICES
NEBRASKA, INC., a Nebraska corporation
AMERICAN MECHANICAL SERVICES OF
NEVADA, INC., a Nevada corporation
By:
------------------------------------
▇▇▇▇ ▇. Held, Vice President
-17-
18
AMERICAN MECHANICAL SERVICES OF
NEW HAMPSHIRE, INC., a New
Hampshire corporation
AMERICAN MECHANICAL SERVICES OF
NEW MEXICO, INC., a New Mexico
corporation
AMERICAN MECHANICAL SERVICES OF
NORTH CAROLINA, INC., a North
Carolina corporation
AMERICAN MECHANICAL SERVICES OF
SACRAMENTO, INC., a California
corporation
AMERICAN MECHANICAL SERVICES OF
TENNESSEE, INC., a Tennessee
corporation
AMERICAN MECHANICAL SERVICES OF
TEXAS, INC., a Delaware Corporation
AMERICAN MECHANICAL SERVICES OF
WASHINGTON, INC., a Washington
corporation
AMS AMERICAN MECHANICAL
SERVICES OF MARYLAND, INC., a
Maryland corporation
AMS AMERICAN MECHANICAL
SERVICES OF VIRGINIA, INC., a
Virginia corporation
AMS AMERICAN MECHANICAL
SERVICES OF WEST VIRGINIA, INC.,
a West Virginia corporation
AMERICAN RESIDENTIAL SERVICES OF
COLORADO, INC., a Colorado corporation
By:
------------------------------------
▇▇▇▇ ▇. Held, Vice President
-18-
19
AMERICAN RESIDENTIAL SERVICES OF
FLORIDA, INC., a Florida corporation
AMERICAN RESIDENTIAL SERVICES OF
GEORGIA, INC., a Georgia corporation
AMERICAN RESIDENTIAL SERVICES OF
ILLINOIS, INC., an Illinois corporation
ILLINOIS HEATING & AIR
CONDITIONING, INC., an Illinois
corporation
AMERICAN RESIDENTIAL SERVICES OF
INDIANA, INC., a Indiana corporation
AMERICAN RESIDENTIAL SERVICES OF
KENTUCKY, INC., a Kentucky corporation
AMERICAN RESIDENTIAL SERVICES OF
MAINE, INC., a Maine corporation
AMERICAN RESIDENTIAL SERVICES OF
MARYLAND, INC., a Maryland corporation
AMERICAN RESIDENTIAL SERVICES OF
MICHIGAN, INC., a Michigan corporation
AMERICAN RESIDENTIAL SERVICES OF
MISSOURI, INC., a Missouri corporation
AMERICAN RESIDENTIAL SERVICES OF
MONTANA, INC., a Montana corporation
AMERICAN RESIDENTIAL SERVICES OF
NEBRASKA, INC., a Nebraska corporation
AMERICAN RESIDENTIAL SERVICES OF
NEVADA, INC., a Nevada corporation
By:
------------------------------------
▇▇▇▇ ▇. Held, Vice President
-19-
20
AMERICAN RESIDENTIAL SERVICES OF
NEW HAMPSHIRE, INC., a New
Hampshire corporation
AMERICAN RESIDENTIAL SERVICES OF
NEW MEXICO, INC., a New Mexico
corporation
AMERICAN RESIDENTIAL SERVICES OF
NORTH CAROLINA, INC., a North
Carolina corporation
AMERICAN RESIDENTIAL SERVICES OF
PENNSYLVANIA, INC., a Pennsylvania
corporation
AMERICAN RESIDENTIAL SERVICES OF
SOUTH CAROLINA, INC., a South
Carolina corporation
AMERICAN RESIDENTIAL SERVICES OF
TENNESSEE, INC., a Tennessee
corporation
AMERICAN RESIDENTIAL SERVICES OF
VIRGINIA, INC., a Virginia corporation
AMERICAN RESIDENTIAL SERVICES OF
WASHINGTON, INC., a Washington
corporation
AMERICAN RESIDENTIAL SERVICES OF
WEST VIRGINIA, INC., a West Virginia
corporation
ARS AMERICAN RESIDENTIAL SERVICES
OF ARIZONA, INC., a Arizona corporation
A.K. LANDAN, INC., a California
corporation
By:
------------------------------------
▇▇▇▇ ▇. Held, Vice President
-20-
21
ARS AMERICAN RESIDENTIAL SERVICES
OF CALIFORNIA, INC., a California
corporation
ARS AMERICAN RESIDENTIAL SERVICES
OF OKLAHOMA, INC., a Oklahoma
corporation
ARS AMERICAN RESIDENTIAL SERVICES
OF RHODE ISLAND, INC., a Rhode Island
corporation
ARS AMERICAN RESIDENTIAL SERVICES
OF TEXAS, INC., a Delaware corporation
ADCOT, INC., a Texas corporation
ARS ENERGY SERVICES COMPANY,
a Delaware corporation
ARS RESIDENTIAL HOLDING COMPANY,
a Delaware corporation
ARS RESIDENTIAL MANAGEMENT
COMPANY, a Delaware corporation
ARS SPECIAL EVENTS, INC., a
Delaware corporation
ASI HASTINGS ACQUISITION, a
California corporation
CAPE FEAR HEATING & AIR
CONDITIONING OF WILMINGTON, INC.,
a North Carolina corporation
MAIO MARKETING SYSTEMS, INC.,
a California corporation
NORTH AMERICAN ELECTRICAL
SERVICES, LLC, a Delaware corporation
By:
-----------------------------------
▇▇▇▇ ▇. Held, Vice President
-21-
22
FREESTATE ELECTRICAL SERVICE
COMPANIES, INC., a Maryland
corporation
SUBURBAN ELECTRICAL SERVICE, INC.,
a North Carolina corporation
WESTERNAIR MANUFACTURER
SERVICE, INC., a Nevada corporation
By:
------------------------------------
▇▇▇▇ ▇. Held, Vice President
-22-
23
SCHEDULE II
I. FOR THE REVOLVING LOANS:
A. For the period prior to March 31, 1999, and after March 31, 2000:
--------------------------------------------------------------------------------
A B C D
Total Consolidated LIBOR Margin Base Rate Revolving
Funded Debt to Margin Commitment Fee
Consolidated
EBITDA Ratio
--------------------------------------------------------------------------------
Less than or equal to 1.25% 0% 0.25%
1.5 to 1.0
--------------------------------------------------------------------------------
Greater than 1.5 to 1.50% 0% 0.30%
1.0, but less than or
equal to 2.0 to 1.0
--------------------------------------------------------------------------------
Greater than 2.0 to 1.75% 0.125% 0.35%
1.0, but less than or
equal to 2.5 to 1.0
--------------------------------------------------------------------------------
Greater than 2.5 to 2.00% .25% 0.40%
1.0, but less than or
equal to 3.0 to 1.0
--------------------------------------------------------------------------------
Greater than 3.0 to 2.50% .50% 0.45%
1.0, but less than or
equal to 3.5 to 1.0
--------------------------------------------------------------------------------
Greater than 3.5 to 2.75% 0.75% 0.50%
1.0
--------------------------------------------------------------------------------
B. For the period beginning March 31, 1999 through March 31, 2000:
-------------------------------------------------------------------------
A B C
LIBOR Margin Base Rate Margin Revolving Commitment Fee
-------------------------------------------------------------------------
3.50% 1.50% 0.75%
-------------------------------------------------------------------------
24
EXHIBIT A
FORM OF COMPLIANCE CERTIFICATE
This certificated dated as of , is prepared pursuant to
Section 7.1(c) of that certain Amended and Restated Secured Revolving and Term
Loan Agreement dated July 2, 1998 (as amended from time to time, the "Loan
Agreement"), among American Residential Services, Inc., a Delaware corporation
("Borrower"), NationsBank, N.A. as Agent, Issuing Lender, and Swing Line Lender
and BankBoston, N.A., as Documentation Agent, The Prudential Insurance Company
of America, as Term Lender, and the lending institutions designated as "Lenders"
on Schedule 1 thereof. Unless otherwise defined in this certificate, capitalized
terms shall have the meaning given to them in the Loan Agreement.
Borrower hereby certifies (a) that no Event of Default has occurred or
is continuing, (b) all of the representations and warranties made by Borrower in
the Loan Agreement are true and correct in all material respects on the date of
this certificate as if made on this date (except for all such representations
and warranties that speak as of a particular date), and that as of ___________,
the following amounts and calculations were true and correct.
A. CONSOLIDATED NET WORTH
(tested quarterly beginning 6/30/98
1. Consolidated Net Worth of Borrower $
(as of date of calculation) --------------------------------
2. Required Minimum (Prior Fiscal Quarter) $
--------------------------------
3. Reported Consolidated Net Income of $
--------------------------------
Borrower for Fiscal Quarter $ X .75
--------------------------------
$
--------------------------------
(not to be less than zero)
4. Net proceeds of equity sales for Fiscal
Quarter $
--------------------------------
5. Stockholders Equity of any acquired Entity (poolings only) and
capital additions attributable to Common Stock issued in
purchase transactions $
--------------------------------
6. Required Minimum (sum of A.2, A.3, A.4 and
A.5) $
--------------------------------
A-1
25
B. FIXED CHARGE COVERAGE RATIO
(tested quarterly beginning 6/30/98)
1. Consolidated GAAP EBITDA of Borrower (four calendar quarters
preceding date of calculation)
a. Borrower's Consolidated Net Income
(before income Taxes) $
--------------------------------
b. Borrower's Depreciation $
--------------------------------
c. Borrower's Amortization $
--------------------------------
d. Borrower's Consolidated Interest $
Expense --------------------------------
e. Borrower's Other Non-Cash Expense $
--------------------------------
f. Cash portion of "Special charge and
other costs" (for quarter ended
December 31, 1997) $
--------------------------------
g. Non-Cash Income $
--------------------------------
h. Consolidated GAAP EBITDA Sum of
(a) - (f), minus (g) $
--------------------------------
2. Rental Expense (four fiscal quarters preceding
date of calculation) $
--------------------------------
3. Cash Tax Expense of Borrower (four fiscal
quarter period preceding date of calculation) $
--------------------------------
4. Consolidated Interest Expense of Borrower (Excluding fee
amortization) (four fiscal quarter period preceding date of
calculation) $
--------------------------------
5. Consolidated Current Maturities of Borrower (scheduled during
for fiscal quarters following
date of calculation) $
--------------------------------
6. Capital Expenditures (four fiscal quarters
preceding date of calculation) $
--------------------------------
A-2
26
7. Ratio of B.1(h), plus B.2, minus B.3 to sum
of B.4, plus B.2, plus B.5, plus B.6 ---------------------------------
(Required Min. .85X prior
to 12/31/99;1.1X
thereafter)
C. CONSOLIDATED FUNDED DEBT TO CONSOLIDATED PRO FORMA EBITDA
RATIO
(tested quarterly beginning 6/30/98)
1. Consolidated Funded Debt of Borrower $
--------------------------------
2. Consolidated GAAP EBITDA of Borrower
(line B.1.h) $
--------------------------------
3. Aggregate of Consolidated Pro Forma EBITDA of each Acquired
Business with Acquisition Date in 12 month period preceding
date of calculation (for the portion of such period
preceding the Acquisition Date) $
--------------------------------
(results based upon
attached certificate)
4. Consolidated Pro Forma EBITDA of Borrower
(sum of line C.2 plus line C.3) $
--------------------------------
5. Ratio of line C.1 to line C.4
--------------------------------
(Required Max. 8.00X
on 9/30/99; 5.25X from
and after 12/31/99 and
prior to 3/31/00; 3.75X
from and after 3/31/00)
D. SENIOR CONSOLIDATED FUNDED DEBT TO Consolidated Pro Forma EBITDA
RATIO
(tested quarterly beginning 6/30/98)
1. Consolidated Funded Debt of Borrower
(line C.1) $
--------------------------------
2. Approved Subordinated Debt of Borrower $
--------------------------------
3. Senior Consolidated Funded Debt of Borrower
--------------------------------
A-3
27
(line D.1 minus line D.2) $
--------------------------------
4. Consolidated Pro Forma EBITDA of Borrower
(line C.4) $
--------------------------------
5. Ratio of line D.3 and line D.4
--------------------------------
(Required Max. 4.25X on
3/31/99; 5.75X on
6/30/99, 5.25X on
9/30/99; 3.50X from and
after 12/31/99 and prior
to 3/31/00; 2.75X from
and after 3/31/00)
E. ADDITIONAL PERMITTED DEBT
1. Additional Debt under (g) of $
--------------------------------
defn. of Permitted Debt (not to exceed
$10,000,000)
F. CAPITAL EXPENDITURES
1. Capital Expenditures (fiscal year
to date) $
--------------------------------
2. Consolidated Net Worth of Borrower $
--------------------------------
end of prior fiscal year (line A.1) X .10
--------------------------------
$
--------------------------------
(not to be less than line F.1)
G. CONSOLIDATED GAAP EBITDA TO CONSOLIDATED INTEREST EXPENSE
RATIO
1. Consolidated GAAP EBITDA (line B.1.g) $
--------------------------------
2. Consolidated Interest Expense (line B.1.d) $
--------------------------------
3. Ratio of G.1 to G.2 $
--------------------------------
(Required min. of 1.5X)
H. SENIOR CONSOLIDATED FUNDED DEBT TO TOTAL CAPITALIZATION RATIO
1. Senior Consolidated Funded Debt (line D.3) $
--------------------------------
A-4
28
2. Consolidated Net Worth (line A.1) $
--------------------------------
3. Certain Capital Stock and other equity $
--------------------------------
4. Ratio of H.1 to H.1 plus H.2 plus H.3 $
--------------------------------
(Required max. of .55X)
I. INTEREST HEDGE AGREEMENTS
1. Amount of Interest Rate Swaps $
--------------------------------
(Max. of $25MM)
J. CONSOLIDATED GAAP EBITDA
(1999 fiscal year to date) $
--------------------------------
(Required Min. of $5MM
on 3/31/99; $15.8MM
on 6/30/99; $28MM on
9/30/99; and $35MM on
12/31/99)
THE FOREGOING REPRESENTATIONS AND STATEMENTS ARE TRUE AND CORRECT IN
ALL MATERIAL RESPECTS AS OF THE DATE HEREOF.
American Residential Services, Inc.
By:
--------------------------------
Name:
------------------------------
Title:
-----------------------------
Date:
------------------------------
A-5
