Third Amendment to Restated Underwriting, Continuing Indemnity, and Security Agreement among Integrated Electrical Services, Inc. and Federal Insurance Company (May 1, 2007)
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Summary
This amendment updates an existing agreement between Integrated Electrical Services, Inc. (and its affiliates and subsidiaries) and Federal Insurance Company. The amendment increases the limit on bonded backlog from $80 million to $100 million, adjusts the pledged collateral and security interests, and requires a $100,000 facility fee to be paid by the indemnitors. It also requires the consent of Bank of America to increase the monthly bond issuance limit. All other terms of the original agreement remain in effect.
EX-10.1 2 d72817_ex10-1.txt THIRD AMENDMENT, DATED AS OF MAY 1, 2007 Exhibit 10.1 THIRD AMENDMENT TO RESTATED UNDERWRITING, CONTINUING INDEMNITY, AND SECURITY AGREEMENT THIS THIRD AMENDMENT TO RESTATED UNDERWRITING, CONTINUING INDEMNITY, AND SECURITY AGREEMENT ("this Third Amendment") is entered into as of the 1st day of May, 2007, by and among INTEGRATED ELECTRICAL SERVICES, INC., a Tennessee corporation, and certain of its Affiliates and Subsidiaries identified on Exhibit A, in their capacity as named Principal under any Bond (individually and collectively "Principal"); and INTEGRATED ELECTRICAL SERVICES, INC., a Delaware corporation, and certain of its Affiliates and Subsidiaries identified on Exhibit B (along with Principal, individually and collectively "Indemnitors"); and FEDERAL INSURANCE COMPANY, an Indiana corporation, its Affiliates and Subsidiaries and their respective co-sureties and reinsurers, and their respective successors and permitted assigns (individually and collectively "Surety"). All capitalized terms will have the meaning set out in Section 1. W I T N E S S E T H: WHEREAS, Indemnitors and Surety entered into that certain Restated Underwriting, Continuing Indemnity, and Security Agreement dated as of May 12, 2006, as amended by First Amendment to Restated Underwriting, Continuing Indemnity, and Security Agreement dated as of October 31, 2006, and Rider to Add Principal/Indemnitor and Second Amendment to Restated Underwriting, Continuing Indemnity, and Security Agreement dated as of December 28, 2006 (collectively "the Agreement"), the terms of which are incorporated herein by this reference; and WHEREAS, the parties desire to enter into this Third Amendment for the purpose of amending and modifying the Agreement, as set out in this Third Amendment. NOW, THEREFORE, in consideration of the foregoing premises and other mutual considerations, the undersigned agree as follows: 1. Definitions. Unless otherwise specifically defined in this Third Amendment, all capitalized terms will have the meaning set out in the Agreement. 2. Bonds; Conditions Precedent to all Bonds. The reference to an Eighty Million Dollars ($80,000,000) limitation on Bonded Backlog is deleted from paragraph (m) of Section 3 of the Agreement and replaced with a reference to One Hundred Million Dollars ($100,000,000). 3. Security Interest; Obligations Secured. Subject to the provisions of Section 4 of this Third Amendment regarding the payment of a facility fee, and provided, that, no Event of Default has occurred Surety will return to Indemnitors Five Million Dollars ($5,000,000) of the Existing Pledged Collateral, which will be returned free and clear of all Liens. Other than the Existing Pledged Collateral that is returned to Indemnitors by Surety, Surety will retain its first priority Lien and security interest in all of the Existing Pledged Collateral in the principal amount of Nine Million Two Hundred Thirty-Eight Thousand Forty 17/100 Dollars ($9,238,040.17) (after payment of the facility fee referred to in Section 4) (plus any interest and earnings that accrue after May 30, 2007) as additional security for any and all Surety Loss. Surety will also retain the Existing Letters of Credit. On May 31, 2007, the principal amount of the Existing Pledged Collateral that is retained by Surety plus the aggregate face amount of the Existing Letters of Credit will be equal to Thirty Million Two Hundred Thirty-Five Thousand Nine Hundred Ninety-Five 67/100 Dollars ($30,235,995.67). 4. Facility Fee. In consideration of Surety's agreement to enter into this Third Amendment, Indemnitors will pay to Surety a facility fee in the amount of One Hundred Thousand Dollars ($100,000). The foregoing facility fee will be due and payable on May 30, 2007, and it will be deducted by Surety from the Existing Pledged Collateral. 5. Consent of Lender. Indemnitors will obtain the agreement of Bank of America, N.A. to amend the existing Intercreditor Agreement to increase the limitation on the aggregate penal amount of Bonds that may be issued per month from and after June 1, 2006, to at least Twenty Million Dollars ($20,000,000) per month. 6. Representations and Warranties of Indemnitors. Each Indemnitor represents and warrants to Surety that all of the representations and warranties made by Indemnitors in the Agreement (whether made as an Indemnitor or as a Principal) and in this Third Amendment are true and correct as applicable to such Principal or Indemnitor in all material respects, as of the date hereof (except to the extent its representations and warranties specifically relate to an earlier date). 7. Continuing Effect. Except as specifically set forth in this Third Amendment, the Agreement remains in full force and effect as originally written. 8. Counterparts. This Third Amendment may be executed by the parties independently in any number of counterparts, all of which together will constitute but one and the same instrument which is valid and effective as if all parties had executed the same counterpart. IN WITNESS WHEREOF, the parties hereto have executed this Third Amendment as of the day and year first above written. SURETY: FEDERAL INSURANCE COMPANY By: _________________________________ Its: _________________________________ 2 PRINCIPAL: INTEGRATED ELECTRICAL SERVICES, INC. By: ____________________________________ Curt Warnock, Senior Vice President ALADDIN WARD ELECTRIC & AIR, INC. AMBER ELECTRIC, INC. ARC ELECTRIC, INCORPORATED BACHOFNER ELECTRIC, INC. BRYANT ELECTRIC COMPANY, INC. COMMERCIAL ELECTRICAL CONTRACTORS, INC. CROSS STATE ELECTRIC, INC. DANIEL ELECTRICAL CONTRACTORS, INC. DAVIS ELECTRICAL CONSTRUCTORS, INC. ELECTRO-TECH, INC. FEDERAL COMMUNICATIONS GROUP, INC. HATFIELD REYNOLDS ELECTRIC COMPANY IES HOUSTON RESOURCES, INC. KAYTON ELECTRIC, INC. MARK HENDERSON, INCORPORATED MENNINGA ELECTRIC, INC. MID-STATES ELECTRIC COMPANY, INC. MITCHELL ELECTRIC COMPANY, INC. MURRAY ELECTRICAL CONTRACTORS, INC. NEWCOMB ELECTRIC COMPANY, INC. NEW TECHNOLOGY ELECTRICAL CONTRACTORS, INC. PAN AMERICAN ELECTRIC, INC. PAULIN ELECTRIC COMPANY, INC. PRIMENET, INC. PRIMO ELECTRIC COMPANY RODGERS ELECTRIC COMPANY, INC. RON'S ELECTRIC, INC. THOMAS POPP & COMPANY VALENTINE ELECTRICAL, INC. By: ____________________________________ Curt Warnock Vice President 3 BEXAR ELECTRIC COMPANY, LTD. By: BW/BEC Inc., its general partner By: ______________________________________ Curt Warnock Vice President HAYMAKER ELECTRIC, LTD. By: General Partner, Inc., its general partner By: ______________________________________ Curt Warnock Vice President HOUSTON-STAFFORD ELECTRICAL CONTRACTORS LP By: Houston-Stafford Management LLC, its general partner By: ______________________________________ Curt Warnock Vice President MILLS ELECTRIC LP By: Mills Management LLC By: ______________________________________ Curt Warnock Vice President NEAL ELECTRIC LP By: BW/BEC Inc., its general partner By: ______________________________________ Curt Warnock Vice President 4 RAINES ELECTRIC LP By: Raines Management LLC, its general partner By: ______________________________________ Curt Warnock Vice President RIVIERA ELECTRIC, LLC By: __________________________________________ Curt Warnock Vice President INDEMNITORS: INTEGRATED ELECTRICAL SERVICES, INC. By: __________________________________________ Curt Warnock, Senior Vice President ALADDIN WARD ELECTRIC & AIR, INC. AMBER ELECTRIC, INC. ARC ELECTRIC, INCORPORATED BACHOFNER ELECTRIC, INC. BRYANT ELECTRIC COMPANY, INC. COMMERCIAL ELECTRICAL CONTRACTORS, INC. CROSS STATE ELECTRIC, INC. DANIEL ELECTRICAL CONTRACTORS, INC. DAVIS ELECTRICAL CONSTRUCTORS, INC. ELECTRO-TECH, INC. FEDERAL COMMUNICATIONS GROUP, INC. HATFIELD REYNOLDS ELECTRIC COMPANY IES HOUSTON RESOURCES, INC. KAYTON ELECTRIC, INC. MARK HENDERSON, INCORPORATED MENNINGA ELECTRIC, INC. MID-STATES ELECTRIC COMPANY, INC. MITCHELL ELECTRIC COMPANY, INC. MURRAY ELECTRICAL CONTRACTORS, INC. NEWCOMB ELECTRIC COMPANY, INC. NEW TECHNOLOGY ELECTRICAL CONTRACTORS, INC. 5 PAN AMERICAN ELECTRIC, INC. PAULIN ELECTRIC COMPANY, INC. PRIMENET, INC. PRIMO ELECTRIC COMPANY RODGERS ELECTRIC COMPANY, INC. RON'S ELECTRIC, INC. THOMAS POPP & COMPANY VALENTINE ELECTRICAL, INC. By: __________________________________________ Curt Warnock Vice President BEXAR ELECTRIC COMPANY, LTD. By: BW/BEC Inc., its general partner By: ______________________________________ Curt Warnock Vice President HAYMAKER ELECTRIC, LTD. By: General Partner, Inc., its general partner By: ______________________________________ Curt Warnock Vice President HOUSTON-STAFFORD ELECTRICAL CONTRACTORS LP By: Houston-Stafford Management LLC, its general partner By: ______________________________________ Curt Warnock Vice President MILLS ELECTRIC LP By: Mills Management LLC By: ______________________________________ Curt Warnock Vice President 6 NEAL ELECTRIC LP By: BW/BEC Inc., its general partner By: ____________________________________ Curt Warnock Vice President RAINES ELECTRIC LP By: Raines Management LLC, its general partner By: ____________________________________ Curt Warnock Vice President RIVIERA ELECTRIC, LLC By: ____________________________________ Curt Warnock Vice President 7 PRINCIPAL
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