UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 OR 15(d)

of the Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported) April 1, 2017

 

Comfort Systems USA, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Registrant’s telephone number, including area code (713) 830-9600

 

 

(Former name or former address, if changed since last report.)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 

Item 2.01 Completion of Acquisition.

 

On April 1, 2017, Comfort Systems USA, Inc. (the “Company”) completed its previously-announced acquisition of all of the outstanding securities of BCH Holdings, Inc., a Florida corporation (“BCH”) pursuant to the terms of the Stock Purchase Agreement (the “Purchase Agreement”), dated as of February 21, 2017, by and among the Company, BCH, the holders of all the outstanding securities of BCH (collectively, the “Selling Shareholders”) and Daryl W. Blume, as representative of the Selling Shareholders.

 

Pursuant to the Purchase Agreement, the Company paid to the Selling Shareholders an initial aggregate purchase price comprised of approximately $85.7 million payable in cash subject to working capital and certain other adjustments set forth in the Purchase Agreement, and $14.3 million aggregate principal amount of unsecured promissory notes (the “Notes”) in favor of the Selling Shareholders bearing interest at a rate of 3% per annum and maturing on the fourth anniversary of the closing of the transaction. In addition, the Purchase Agreement provides for an additional earn-out amount to become payable by the Company to the extent that BCH’s EBITDA (as defined in the earn-out agreement) during each of the years following the closing of the transaction through December 31, 2021 exceeds certain thresholds (the “Earn-Out Payments”). The Notes and the Earn-Out Payments are subject to offset by the Company in respect of any indemnity claims made pursuant to the Purchase Agreement. The Purchase Agreement contains customary representations, warranties, covenants and indemnities. The closing of the transaction was subject to customary closing conditions.

 

The foregoing description of the Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Purchase Agreement, a copy of which was filed as Exhibit 2.1 to the current report on Form 8-K by the Company with the U.S. Securities and Exchange Commission (the “SEC”) on February 23, 2017 and is incorporated herein by reference.  The foregoing description of the Notes does not purport to be complete and is qualified in its entirety by reference to the Note, a copy of which is filed as Exhibit 10.1 hereto and is incorporated herein by reference.

 

The foregoing description and the copy of the Purchase Agreement have been included to provide investors with information regarding the terms of the Purchase Agreement. They are not intended to provide any other factual information about the Company, BCH or their respective subsidiaries or affiliates. The representations, warranties and covenants contained in the Purchase Agreement were made only for purposes of those agreements and as of specific dates, were solely for the benefit of the parties to the Purchase Agreement, and may be subject to limitations agreed upon by the parties, including being qualified by confidential disclosures made by each contracting party to the other for the purposes of allocating contractual risk between them that differ from those applicable to investors. Investors should be aware that the representations, warranties and covenants or any description thereof may not reflect the actual state of facts or condition of the Company, BCH or any of their respective subsidiaries, affiliates or businesses. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Purchase Agreement, which subsequent information may or may not be fully reflected in public disclosures by the Company or BCH. Accordingly, investors should read the representations and warranties in the Purchase Agreement not in isolation but only in conjunction with the other information about the Company and BCH and their respective subsidiaries that the Company includes in reports, statements and other filings that it makes with the SEC.

 

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

 

The information disclosed in Item 2.01 of this Current Report on Form 8-K is incorporated by reference into this Item 2.03.

 

Item 7.01 Regulation FD Disclosure.

 

On April 3, 2017 the Company issued a press release. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

 

The information included in this Current Report on Form 8-K under this Item 7.01 (including Exhibit 99.1 hereto) is being “furnished” and shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of Section 18, nor shall it be incorporated by reference into a filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as shall be expressly set forth by specific reference in such filing. The information included in this Current Report on Form 8-K under this Item 7.01 (including Exhibit 99.1 hereto) will not be deemed an admission as to the materiality of any information required to be disclosed solely to satisfy the requirements of Regulation FD.

 

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Item 9.01 Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit No.		Description
10.1		Form of Promissory Note, dated April 1, 2017, issued by the Company in favor of each of the Selling Shareholders.
99.1		Press Release of Comfort Systems USA, Inc. dated April 3, 2017.

 

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SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	COMFORT SYSTEMS USA, INC.
	By:	/s/ Trent T. McKenna
		Trent T. McKenna, Senior Vice President, General Counsel and Secretary
Date: April 3, 2017

 

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EXHIBIT INDEX

 

Exhibit Number		Exhibit Title or Description
10.1		Form of Promissory Note, dated April 1, 2017, issued by the Company in favor of each of the Selling Shareholders.
99.1		Press Release of Comfort Systems USA, Inc. dated April 3, 2017.

 

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