8-KMaterial AgreementsExhibits & Filings

EMCOR Group, Inc. 8-K Report, Material Agreement (Feb 8, 2010)

Filed February 8, 2010For Securities:EME

Summary

EMCOR Group, Inc. has filed an 8-K report on February 8, 2010, detailing significant changes to its credit facilities. The company entered into a Second Amended and Restated Credit Agreement, establishing a revolving credit facility with a borrowing capacity of up to $550 million. This facility can potentially be increased by an additional $100 million under certain conditions, offering substantial financial flexibility. The new credit agreement is secured by substantially all of the Company's and its subsidiaries' assets and includes financial covenants, representations, warranties, and events of default. In conjunction with the new credit facility, EMCOR Group also terminated a prior Term Loan Agreement dated September 19, 2007. The company utilized funds from the new credit agreement, along with its own cash, to fully repay the outstanding $195 million indebtedness under the terminated term loan. This move effectively consolidates debt, simplifies its capital structure, and demonstrates proactive financial management in addressing its debt obligations.

Key Highlights

  • 1EMCOR Group entered into a new Second Amended and Restated Credit Agreement, effective February 4, 2010.
  • 2The new credit facility provides a revolving credit line of up to $550 million.
  • 3The company has the option to increase the credit facility by an additional $100 million, subject to lender approval.
  • 4The Credit Agreement is secured by substantially all of EMCOR Group's and its subsidiaries' assets.
  • 5EMCOR Group terminated its Term Loan Agreement dated September 19, 2007.
  • 6Approximately $195 million in outstanding indebtedness was repaid using funds from the new credit agreement and company cash.
  • 7The filing indicates the establishment of a more flexible and potentially larger credit line while retiring a previous term loan.

Frequently Asked Questions

The main purpose of this 8-K filing is to report EMCOR Group's entry into a new, larger revolving credit facility and the termination of a previous term loan. This indicates a significant change in the company's debt structure and financing arrangements.

The new facility is a Second Amended and Restated Credit Agreement establishing a revolving credit line of up to $550 million. It also allows for a potential increase of up to $100 million. The agreement has a three-year term and is secured by the company's and its subsidiaries' assets.

EMCOR Group used a portion of the funds from the new credit facility, along with its own cash, to pay off the entire outstanding balance of approximately $195 million under its Term Loan Agreement dated September 19, 2007. As a result, that term loan agreement has been terminated.

This refinancing signifies improved financial flexibility. The company has secured a larger revolving credit line, potentially increasing its borrowing capacity, and has retired a significant term loan, simplifying its debt obligations and potentially lowering interest expenses depending on the terms of the new agreement.