As filed with the Securities and Exchange Commission on April 2, 1999
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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COMFORT SYSTEMS USA, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 1711 76-0526487
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
OF INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
777 POST OAK BLVD., SUITE 500
HOUSTON, TEXAS 77056
(713) 830-9600
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(ADDRESS, INCLUDING ZIP CODE AND TELEPHONE NUMBER, INCLUDING AREA
CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
FRED M. FERREIRA
CHIEF EXECUTIVE OFFICER
Comfort Systems USA, Inc.
777 Post Oak Blvd., Suite 500
Houston, Texas 77056
(713) 830-9600
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(NAME AND ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
PLEASE SEND COPIES OF ALL COMMUNICATIONS TO:
WILLIAM GEORGE, ESQ.
Comfort Systems USA, Inc.
777 Post Oak Blvd., Suite 500
Houston, Texas 77056
(713) 830-9600
Approximate date of commencement of proposed sale to the public: From time to
time after the effectiveness of this Registration Statement.
If the securities being registered on this Form are being offered in connection
with the formation of a holding company and there is compliance with General
Instruction G, check the following box. [ ]
If this Form is filed to register
additional securities for an offering pursuant to Rule 462(b) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. [ ]
If this Form is a post-effective amendment filed
pursuant to Rule 462(d) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If any of the
securities being registered on this Form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act, check the
following box. [X]
CALCULATION OF REGISTRATION FEE
PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO OFFERING PRICE AGGREGATE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED BE REGISTERED (1) PER SHARE(2) PRICE(2) FEE
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Common Stock -- $0.01 par value
per share 5,000,000 $14.65625 $73,281,250 $20,373
(1) Pursuant to Rule 416(a) under the Securities Act, the number of shares of
common stock registered hereby is subject to adjustment to prevent dilution
resulting from stock splits, stock dividends or similar transactions.
(2) Estimated solely for the purpose of determining the registration fee in
accordance with Rule 457(c) under the Securities Act. The maximum price per
share information is based on the average of the high and the low sale prices of
the Registrant's common stock, $0.01 par value per share, reported on the New
York Stock Exchange on March 31, 1999.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
PROSPECTUS SUBJECT TO COMPLETION
APRIL 2, 1999
5,000,000 Shares
COMFORT SYSTEMS USA, INC.
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COMMON STOCK
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This prospectus covers 5,000,000 shares of common stock that we may issue
and sell from time to time in business combination transactions. We and the
owners or controlling persons of the businesses or assets acquired will
negotiate the terms of any business combination. We will determine the value of
the shares of common stock to be issued at prices reasonably related to market
prices current either at the time of agreement on the terms of a business
combination or at or about the time of delivery of the shares. We may also
permit this prospectus to cover sales by persons or entities who have received
shares of common stock under this prospectus and who elect to use this
prospectus to cover the resale of the shares.
We will pay all expenses of the offering. We will not pay any underwriting
discounts or commissions in connection with the issuance or sale of any shares,
although we may pay finder's fees in connection with specific business
combinations. Any person receiving a finder's fee may be deemed to be an
underwriter of the shares issued in the transaction.
Our common stock is listed on the New York Stock Exchange ("NYSE") with
the ticker symbol: "FIX." On March 31, 1999, the closing price of one share of
our common stock on the NYSE was $14.625.
BEFORE PURCHASING SHARES OF OUR COMMON STOCK YOU SHOULD CAREFULLY REVIEW THE
RISK FACTORS SECTION OF THIS PROSPECTUS WHICH BEGINS ON PAGE 3.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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The date of this prospectus is April |X|, 1999
THIS PROSPECTUS INCORPORATES IMPORTANT BUSINESS AND FINANCIAL INFORMATION
THAT IS NOT INCLUDED IN OR DELIVERED WITH THIS PROSPECTUS. THIS INFORMATION IS
AVAILABLE WITHOUT CHARGE TO SECURITY HOLDERS UPON ORAL OR WRITTEN REQUEST TO
COMFORT SYSTEMS USA, INC., 777 POST OAK BLVD., SUITE 500, HOUSTON, TEXAS 77056,
ATTENTION: INVESTOR RELATIONS (TEL. (713) 830-9600). TO ENSURE TIMELY DELIVERY
OF THE INFORMATION, PLEASE MAKE ANY REQUEST AT LEAST FIVE DAYS BEFORE THE DAY
YOU MUST MAKE YOUR INVESTMENT DECISION. SEE "WHERE YOU CAN FIND MORE
INFORMATION."
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WE HAVE NOT AUTHORIZED ANY PERSON TO PROVIDE INFORMATION OR MAKE ANY
REPRESENTATION ABOUT THIS OFFERING THAT IS NOT IN THIS PROSPECTUS. PROSPECTIVE
INVESTORS SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS PROSPECTUS. THIS
PROSPECTUS IS NOT AN OFFER TO SELL NOR IS IT SEEKING AN OFFER TO BUY THESE
SECURITIES IN ANY JURISDICTION WHERE THE OFFER OR SALE IS PROHIBITED.
INFORMATION IN THIS PROSPECTUS IS CORRECT ONLY AS OF ITS DATE, REGARDLESS OF
WHEN ANY LATER OFFER OR SALE OCCURS.
TABLE OF CONTENTS
PAGE
RISK FACTORS.................................................................3
THE COMPANY..................................................................7
SELECTED FINANCIAL DATA......................................................8
PLAN OF DISTRIBUTION.........................................................9
AVAILABLE INFORMATION.......................................................10
WHERE YOU CAN FIND MORE INFORMATION.........................................10
VALIDITY OF COMMON STOCK....................................................11
EXPERTS.....................................................................11
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Our principal executive offices are located at 777 Post Oak Blvd., Suite
500, Houston, Texas 77056 and our telephone number is (713) 830-9600.
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RISK FACTORS
An investment in our common stock involves a high degree of risk. In
addition to the other information in this prospectus, you should carefully
consider the following risk factors in evaluating an investment in our common
stock. This prospectus contains "forward-looking statements" about our
operations, economic performance and financial condition, including, in
particular, the likelihood of our success in developing and expanding our
business. These statements are based upon a number of assumptions and estimates
that are inherently subject to significant uncertainties and contingencies, many
of which are beyond our control, and reflect future business decisions that are
subject to change. Some of these assumptions inevitably will not materialize,
and unanticipated events will occur that will affect our results.
WE HAVE ONLY OPERATED FOR A SHORT PERIOD OF TIME AND THEREFORE DO NOT HAVE A
LONG TRACK RECORD OF RESULTS
Before July 2, 1997, we were not operating and generating revenues. We have
acquired many companies in a short period of time. Each of these companies was a
separate entity with its own financial reporting systems and operations
procedures. These multiple systems and procedures may be both inefficient and
difficult to operate separately. It is difficult to implement a single set of
systems that will allow us to effectively and efficiently both manage the
combined group of acquired companies and continue to profitably acquire other
companies. Our management group continues to develop and was only assembled in
1997. There is no way to be sure that it will be able to effectively operate the
business, help it grow and efficiently and profitably acquire more companies.
WE MAY BE UNABLE TO IMPROVE OR EVEN MAINTAIN THE PROFITABILITY OF OUR ACQUIRED
BUSINESSES
One of our key strategies is to maintain and eventually increase the profits and
the revenues of the companies that we purchase. There are many factors which may
make it difficult to maintain or increase revenues and profits. As part of a
larger company, our acquisitions may bear additional overhead and may be held to
higher performance and regulatory standards. On the cost side, we try to save
money by purchasing materials for each of these companies in bulk and thus
paying lower prices for the supplies. We also try to reduce duplicative costs
such as overhead by administering some aspects of the acquired companies from
our headquarters. Revenue growth depends on the demand for new and replacement
heating, ventilation and air conditioning or "HVAC" systems, level of new
construction and our ability to develop regional and national marketing programs
and attract new customers. Most of these factors are beyond our control. We may
not be successful in increasing or maintaining revenues and profits.
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THERE IS A GREAT DEAL OF COMPETITION IN THE HVAC INDUSTRY
There are many companies in the HVAC industry; some are small owner-operated
companies and others are large companies with great resources. Some companies
may have lower standards or lower labor or overhead costs and thus may be able
to charge lower prices for their services. Other companies are also attempting
to consolidate the industry just as we are. These other companies may be using
the same strategies and may have greater financial resources than we do. These
other companies may be willing to pay more for companies we want to purchase
because they have more resources to spend. There are some HVAC manufacturers and
public utilities that maintain, repair and replace HVAC systems. These companies
are generally better capitalized, are more well known and may be able to provide
their services at a lower cost than us. Because of these advantages that other
companies may have, we may face significant competition in trying to acquire and
increase the profitability of new companies.
OUR BUSINESS CAN BE CYCLICAL AND SEASONAL, WHICH MAY CAUSE OUR OPERATING RESULTS
TO FLUCTUATE
The construction industry as a whole has been highly cyclical in the past.
Because much of our work is in new construction or major replacement, if
business in the construction industry declines as a whole it may negatively
affect us. Also, during the winter months there is a lower demand for
installations of HVAC units because of reduced construction activity during
inclement weather and less use of air conditioning. However, during the spring
and summer months the number of installations and repairs that we perform is
higher due to the increased use of air conditioning during warmer months. Due to
this seasonality, we expect that revenues will be higher in the second and third
calendar quarters and lower in the first and fourth calendar quarters.
OUR ACQUISITION PROGRAM CAN BE RISKY FOR A NUMBER OF REASONS
We plan to continue to buy numerous HVAC and related businesses. Other companies
may also try to purchase these same businesses. The competition may lead to a
reduced number of potential businesses to buy and higher prices for those we
succeed in buying. There is always a possibility that we will have trouble
integrating new businesses into our overall structure. We will only receive the
anticipated benefits from an acquisition if we successfully integrate it into
our own business in a timely and non-disruptive manner. Difficulties that we
encounter integrating an acquired business can have an adverse effect on our
overall business and operating results. We may have to spend a substantial
amount of money to integrate these businesses and may experience delays in
integration as well as other problems we can not easily predict. Other problems
may include low profits, the inability of managers to run the businesses in an
effective manner and the possibility that a manager important to one of those
businesses could leave, perhaps because ownership is diluted or there is a loss
of control. All
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of these possible problems, along with others we may not fully understand at
this time, could lead us to financial difficulties. Also, dissatisfied customers
of one of the businesses that we may purchase could hurt our national
reputation, thus making our overall sales and marketing efforts less effective.
IT IS DIFFICULT TO PREDICT HOW MUCH MONEY WE WILL NEED TO CONTINUE TO GROW
It is hard to predict how much money we will need to purchase and continue to
run the numerous companies that we buy. We pay many of the sellers of these
companies with our common stock, as well as with cash and notes in most cases.
If the price of our common stock goes down, we would need to use more shares to
deliver the same dollar value to a seller. Furthermore, some sellers may not
want to accept as much stock if the value of our stock has dropped
significantly; they may demand to be paid more cash. Because cash is a limited
resource, the more sellers that demand a portion or all of their purchase price
in cash, the fewer companies we can buy. We have a bank line of credit of $300
million, meaning that we can borrow up to that amount for purposes of buying
companies and for other related reasons. As of March 31, 1999, we had borrowed
$183 million of the available $300 million. This money has been used to purchase
some new companies and to pay some debts of the companies that we have already
purchased. There are also some financial tests imposed on our ability to borrow
up to the $300 million available.
HIGHLY SKILLED TECHNICIANS ARE IMPORTANT TO US AND THEY ARE A SCARCE RESOURCE
We need many skilled HVAC technicians to successfully install, service,
maintain, repair and replace HVAC units. If we have difficulty in hiring,
training and retaining good employees, it will be difficult to increase our
productivity and profitability. From time to time there are shortages of
qualified HVAC technicians which could mean that we would have to pay higher
wages to retain and attract good employees. If we can not find enough good
employees, we may have to restrict our growth.
REGULATORY CHANGES IN THE HVAC INDUSTRY MAY AFFECT OUR BUSINESS
The HVAC industry is subject to various environmental statutes and regulations
such as the Clean Air Act and others that regulate production, servicing and
disposal of ozone depleting refrigerants used in HVAC units. These regulations
may change at any time. Various local, state and federal laws and regulations
impose licensing standards on technicians who install and service HVAC systems.
If we were to fail to comply with these laws and regulations we could be fined,
could be subject to civil liability and could lose important licenses.
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COMPUTERS COULD CAUSE PROBLEMS RELATING TO THE YEAR 2000
We are currently trying to make all of our computers capable of understanding
the year 2000. Some older computers may have a difficult time understanding the
year 2000 because it may be referred to by two digits, like "99" for the year
1999. There is a possibility that some computers would think that the year "00"
is the year 1900 instead of the year 2000. We think that our computers will be
fixed in time; however there is no guarantee of this. We do not think that it
will cost a significant amount of money to fix our computers. However, we also
rely on other businesses and their computers. There is no way for us to insure
that other businesses will fix their computers. If we are not successful in
fixing our computers or if those with whom we do business do not fix their
computers, our business could suffer.
TOO MANY SHARES ON THE MARKET MAY LOWER THE PRICE OF OUR SHARES
If substantial amounts of our common stock are available for sale the price of
the common stock may go down. As of March 31, 1999, there were approximately
38.6 million shares of common stock outstanding. Approximately 19.5 million of
those shares are freely tradeable. The rest of the shares are either
contractually restricted or may only be sold publicly if they are registered
under the Securities Act or are exempted from registration and are permitted to
be sold under contracts we have with these holders. A great deal of our stock
that has restrictions become tradeable under Rule 144 or pursuant to the
expiration of contractual restrictions during the next five years. This year,
approximately 3.0 million shares become eligible for sale in the second quarter,
1.7 million shares become eligible for sale in the third quarter, and 1.0
million shares become eligible for sale in the fourth quarter. During 2000,
approximately 4.8 million shares become eligible for sale. After 2000,
approximately 8.7 million additional shares becomes eligible for sale on various
dates as contractual restrictions expire. We also have outstanding options to
purchase approximately 4.4 million shares of common stock which vest ratably
over five years from their dates of grant. We also expect to continue to
register and issue shares for use in connection with acquisitions and these
shares may be freely traded, after their issuance, by persons not affiliated
with us unless we contractually restrict their resale.
SOME PROVISIONS IN OUR CHARTER MAY PREVENT TAKEOVERS
Our charter authorizes the Board of Directors to issue, without stockholder
approval, one or more series of preferred stock having preferences, powers and
rights (including preferences over the common stock) that the Board of Directors
may determine. The issuance of this "blank-check" preferred stock could make it
more difficult or discourage an attempt to obtain control of us. In addition,
our charter provides for a classified Board of Directors, meaning that only
approximately one third of the directors are up for election in any given year,
which may also have the effect of inhibiting or delaying a change in control.
Provisions of the Delaware General Corporation Law that limit a person's ability
to effect a business
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combination without either approval of the Board of Directors of a company or
supermajority approval of the stockholders of such company may also discourage
takeover attempts.
THE COMPANY
We are a leading national provider of comprehensive HVAC installation,
maintenance, repair and replacement services. Founded in December 1996, we are
consolidating the fragmented commercial and industrial HVAC markets. We perform
most of our services within manufacturing plants, office buildings, retail
centers, apartment complexes, and health care, education and government
facilities. In addition to standard HVAC services, we also provide specialized
applications such as process cooling, control systems, electronic monitoring and
process piping. Some of our locations also perform related services such as
electrical, plumbing and fire suppression. Approximately 97% of our pro forma
combined 1998 revenues were derived from commercial and industrial customers
with approximately 55% of the revenues attributable to installation services and
45% attributable to maintenance, repair and replacement services.
Our principal executive offices are located at 777 Post Oak Blvd., Suite
500, Houston, Texas 77056 and our telephone number is (713) 830-9600.
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SELECTED FINANCIAL DATA
(IN THOUSANDS)
We acquired twelve original companies in connection with an initial public
offering on July 2, 1997. Subsequent to the initial public offering and through
December 31, 1998, we completed 82 acquisitions, 17 of which were accounted for
as poolings-of-interests and 65 of which were accounted for as purchases. The
following selected historical financial data has been derived from our audited
financial statements for each of the three years ended December 31, 1996, 1997,
and 1998. The remaining selected historical financial data has been derived from
our unaudited financial statements. These unaudited financial statements have
been prepared on the same basis as our audited financial statements, and in the
opinion of management, reflect all adjustments necessary for a fair presentation
of that historical information. The historical financial statement data reflects
the acquisitions of the 12 original companies and the purchased companies as of
their respective acquisition dates and reflects 15 of the pooled companies for
all periods presented. Two of the pooled companies are considered immaterial
poolings based upon criteria set forth by the SEC and have not been restated for
all periods presented. The selected historical financial data below should be
read along with the consolidated historical financial statements and related
notes, which have been incorporated by reference into this prospectus.
YEAR ENDED DECEMBER 31,
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1994 1995 1996 1997 1998
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STATEMENT OF OPERATIONS DATA:
Revenues ............................ $ 126,023 $ 126,794 $ 161,419 $ 297,646 $ 853,961
Operating income .................... 3,653 4,011 6,575 5,699 68,497
Net income (loss) ................... 2,896 3,137 4,589 (2,064) 35,013
BALANCE SHEET DATA:
Working capital ..................... $ 8,803 $ 10,110 $ 13,971 $ 63,137 $ 133,390
Total assets ........................ 36,366 42,035 50,366 308,779 789,293
Total debt, including current portion 6,738 9,076 8,376 24,726 236,446
Stockholders' equity ................ 9,385 10,731 15,429 217,635 379,932
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PLAN OF DISTRIBUTION
GENERAL
This prospectus relates to 5,000,000 shares of common stock that we may
offer and issue from time to time in connection with our acquisition of other
businesses, properties or equity and/or debt securities in business combination
transactions. This prospectus will also relate to some shares of common stock
that persons who acquired shares pursuant to this prospectus may resell or
reoffer.
We intend to concentrate our acquisitions in areas related to our current
business. If the opportunity arises, however, we may make acquisitions that are
either complementary to our present operations or that we consider advantageous
even though the business may not be the same as our present activities. The
consideration for any such acquisition will be determined by negotiations
between us and the owners or controlling persons of the acquired businesses or
assets. We expect that the shares of common stock issued in any acquisition will
be valued at a price reasonably related to the market value of the common stock
either at the time we agree on the terms of an acquisition or at the time of
delivery of the shares.
We do not expect to pay underwriting discounts or commissions in
connection with the issuance of shares of common stock under this prospectus.
However, we may pay finders' fees or brokers' commissions in connection with
specific acquisitions, and these fees may be paid in shares of common stock
covered by this prospectus. Any person receiving a fee may be an underwriter
within the meaning of the Securities Act.
SELLING STOCKHOLDERS
We may from time to time permit persons who receive shares of common stock
in business combinations to resell their shares using this prospectus.
These sales may be effected from time to time on the NYSE at prevailing
prices or at negotiated prices. The selling stockholders may also sell shares in
private transactions or in the over-the-counter market at prices related to the
prevailing prices of the shares on the NYSE.
The selling stockholders may use broker-dealers to effect these
transactions. These broker-dealers may receive compensation in the form of
underwriting discounts, concessions or commissions from the sales. The selling
stockholders and any broker-dealers that participate in the distribution may
under certain circumstances be deemed to be underwriters within the meaning of
the Securities Act, and any commissions received or profits realized may be
deemed to be underwriting discounts and commissions under the Securities Act. We
and the selling stockholders may also agree to indemnify the broker-dealers
against certain liabilities under the Securities Act. In addition, we may agree
to indemnify the selling stockholders and any underwriter of the shares of
common stock against certain liabilities
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under the Securities Act or, if indemnity is unavailable, to contribute toward
amounts required to be paid in respect of such liabilities.
If required under the Securities Act, we will file a supplemental
prospectus disclosing the name of any selling stockholder, the name of any
broker-dealers involved in a sale, the number of shares involved, the price at
which such shares are to be sold, the commissions paid or discounts or
concessions allowed and other facts material to the transaction.
We may agree to pay certain costs and expenses that the selling
stockholders incur in connection with the registration of their shares, but we
expect that the selling stockholders pay all selling commissions, transfer taxes
and related charges in connection with the offer and sale of their shares.
The selling stockholders may sell the shares of common stock offered
hereby from time to time and may choose to sell less than all or none of such
shares.
AVAILABLE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file with the
SEC at the SEC's public reference rooms in Washington, D.C., New York, New York
and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our SEC filings are also available to
the public from the SEC's Website at "http://www.sec.gov." Our common stock is
listed on the NYSE under the symbol "FIX" and the periodic reports, proxy
statements and other information we file with the SEC may also be inspected at
the offices of the NYSE at 20 Broad Street, New York, New York 10005.
WHERE YOU CAN FIND MORE INFORMATION
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and the information that we file later
with the SEC will automatically update and supersede this information. We
incorporate by reference the documents listed below:
(1) Our Annual Report on Form 10-K for the fiscal year ended December
31, 1998, filed on March 31, 1999.
(2) Amendment No. 1 to our Annual Report on Form 10-K/A for the fiscal
year ended December 31, 1997 filed on February 22, 1999.
(3) Amendment on Form 8-K/A filed on April 23, 1998 to our current
report on Form 8-K filed on February 26, 1998.
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(4) Amendment on Form 8-K/A filed on January 29, 1999 to our current
report on Form 8-K filed on November 15, 1998.
(5) The Registration Statement of our common stock on Form 8-A filed on
May 19, 1997.
In addition, this prospectus incorporates by reference any future filings
we will make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 from the date of the initial filing of the
registration statement that includes this prospectus until the termination of
the offering. Information in this prospectus supersedes related information in
the documents listed above and information in subsequently filed documents
supersedes related information in both this prospectus and the incorporated
documents.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Comfort Systems USA, Inc.
777 Post Oak Blvd., Suite 500
Houston, Texas 77056
Attention: Investor Relations
(713) 830-9600
This prospectus is part of a registration statement that we have filed
with the SEC. You should rely only on the information or representations
provided in this prospectus. We have not authorized nor have any of the selling
stockholders authorized anyone to provide you with different information. The
selling stockholders are not making an offer of these securities in any state
where the offer is not permitted. You should not assume that the information in
this prospectus is accurate as of any date other than the date on the front of
the document.
VALIDITY OF COMMON STOCK
For the purpose of this offering, our General Counsel, William George,
Esq., is providing an opinion on the validity of the shares.
EXPERTS
Our audited consolidated financial statements are incorporated in this
prospectus by reference to our filing on Form 10-K dated March 31, 1999, have
been audited by Arthur Andersen LLP, independent public accountants, as
indicated in their reports with respect thereto, and are incorporated by
reference in reliance upon the authority of that firm as experts in giving those
reports. The audited financial statements of certain of our subsidiaries are
incorporated by reference to certain of our other filings. The audited financial
statements of Shambaugh & Son, Inc., are incorporated in this prospectus by
reference to our filing on Form
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8-K/A dated January 29, 1999, have been audited by Crowe, Chizek and Company
LLP, independent public accountants, as indicated in their reports with respect
thereto, and are incorporated by reference in reliance upon the authority of
that firm as experts in giving those reports. The audited financial statements
of F&G Mechanical Corp. and its affiliated companies are incorporated in this
prospectus by reference to our filing on Form 8-K/A dated April 23, 1998, have
been audited by Marden Harrison & Kreuter, independent public accountants, as
indicated in their reports with respect thereto, and are incorporated by
reference in reliance upon the authority of that firm as experts in giving those
reports.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company's Second Amended and Restated Certificate of Incorporation, as
amended, and Bylaws, as amended, incorporate substantially the provisions of the
Delaware General Corporation Law ("DGCL") providing for indemnification of
directors and officers of the Company against expenses, judgments, fines,
settlements and other amounts actually and reasonably incurred in connection
with any proceeding arising by reason of the fact that such person is or was an
officer or director of the Company or is or was serving at the request of the
Company as a director, officer or employee of another corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise.
As permitted by Section 102 of the DGCL, the Company's Second Amended and
Restated Certificate of Incorporation, as amended, contains provisions
eliminating a director's personal liability for monetary damages to the Company
and its stockholders arising from a breach of a director's fiduciary duty except
for liability (a) for any breach of the director's duty of loyalty to the
Company or its stockholders, (b) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (c) under
Section 174 of the DGCL, or (d) for any transaction from which the director
derived an improper personal benefit.
Section 145 of the DGCL provides generally that a person sued as a
director, officer, employee or agent of a corporation may be indemnified by the
corporation for reasonable expenses, including attorneys' fees, if in the case
of other than derivative suits such person has acted in good faith and in a
manner such person reasonably believed to be in or not opposed to the best
interests of the corporation (and, in the case of a criminal proceeding, had no
reasonable cause to believe that such person's conduct was unlawful). In the
case of a derivative suit, an officer, employee or agent of the corporation
which is not protected by the Second Amended and Restated Certificate of
Incorporation, as amended, may be indemnified by the corporation for reasonable
expenses, including attorneys' fees, if such person has acted in good faith and
in a manner such person reasonably believed to be in or not opposed to the best
interests of the corporation, except that no indemnification shall be made in
the case of a derivative suit in respect of any claim as to which an officer,
employee or agent has been adjudged to be liable to the corporation unless that
person is fairly and reasonably entitled to indemnity for proper expenses.
Indemnification is mandatory in the case of a director, officer, employee, or
agent who is successful on the merits in defense of a suit against such person.
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The Company has entered into Indemnity Agreements with its directors and
certain key officers pursuant to which the Company generally is obligated to
indemnify its directors and such officers to the full extent permitted by the
DGCL as described above.
The Company has purchased liability insurance policies covering directors
and officers in certain circumstances.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) The following exhibits are filed herewith or incorporated herein by
reference.
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT LOCATION
3.1 Second Amended and Restated Incorporated by reference to Exhibit 3.1. of the
Certificate of Incorporation. Company's Amendment No. 1 to its
Registration Statement on Form S-1, as filed on
June 2, 1997.
3.2 Certificate of Amendment dated Incorporated by reference to Exhibit 3.2 of the
May 21, 1998. Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1998, as
filed on March 31, 1999.
3.3 Bylaws, as amended. Incorporated by reference to Exhibit 3.3
of the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1998,
as filed on March 31, 1999.
4.1 Form of certificate evidencing Incorporated by reference to Exhibit 4.1.
ownership of common stock. of the Company's Amendment No. 1 to its
Registration Statement on Form S-1, as
filed on June 2, 1997.
5.1 Opinion of William George, Esq., Filed herewith.
General Counsel of the Company, re:
validity of shares.
21.1 List of Subsidiaries. Incorporated by reference to Exhibit 21.1
of the Company's Annual Report on Form 10-K
for the fiscal year ended December 31, 1998, as
filed on March 31, 1999.
23.1 Consent of Arthur Andersen LLP. Filed herewith.
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23.2 Consent of Marden Harrison & Filed herewith.
Kreuter.
23.3 Consent of Crowe, Chizek and Filed herewith.
Company LLP.
23.4 Consent of William George, Esq. See Exhibit 5.1 filed herewith.
24.1 Power of Attorney. Included as part of signature page filed herewith.
ITEM 22. UNDERTAKINGS.
The undersigned registrant hereby undertakes as follows:
(1) To file, during any period in which any offers or sales are being
made, a post-effective amendment to this registration statement;
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
II-3
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(5) That prior to any public reoffering of the securities registered
hereunder through use of a prospectus which is a part of this registration
statement, by any person or party who is deemed to be an underwriter within the
meaning of Rule 145(c), the issuer undertakes that such reoffering prospectus
will contain the information called for by the applicable registration form with
respect to reofferings by persons who may be deemed underwriters, in addition to
the information called for by the other items of the applicable form.
(6) That every prospectus (i) that is filed pursuant to paragraph (5)
immediately preceding, or (ii) that purports to meet the requirements of Section
10(a)(3) of the Act and is used in connection with an offering of securities
subject to Rule 415, will be filed as a part of an amendment to the registration
statement and will not be used until such amendment is effective, and that, for
purposes of determining any liability under the Securities Act of 1933, each
such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(7) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
(8) To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Item 4, 10(b), 11, or 13 of this Form,
within one business day of receipt of such request, and to send the incorporated
documents by first class mail or other equally prompt means. This includes
information contained in documents filed subsequent to the effective date of the
registration statement through the date of responding to the request.
II-4
(9) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in the registration statement when it became
effective, except where the transaction in which the securities being offered
pursuant to the registration statement would itself qualify for an exemption
under Section 5 of the Securities Act of 1933, absent the existence of other
similar (prior or subsequent) transactions.
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SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Houston, State of Texas,
on the 31st day of March, 1999.
COMFORT SYSTEMS USA, INC.
By:/S/FRED M. FERREIRA
Fred M. Ferreira
Chief Executive Officer
Date: MARCH 31, 1999
POWER OF ATTORNEY
Each person whose signature appears below on this Registration Statement
hereby constitutes and appoints Fred M. Ferreira, J. Gordon Beittenmiller and
William George, III, each with full power to act without the other, his or her
true and lawful attorney-in-fact and agent, with full power of substitution and
resubstitution, for him or her and in his or her name, place and stead, in any
and all capacities (until revoked in writing) to sign any and all amendments
(including post-effective amendments and amendments thereto) to this
Registration Statement, and to file the same, with all exhibits thereto and
other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent full power and
authority to do and perform each and every act and thing he or she might do or
could do in person, hereby ratifying and confirming all that said
attorney-in-fact and agent, or his substitute, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement or amendment thereto has been signed by the following
persons in the indicated capacities on March 31, 1999.
SIGNATURE TITLE DATE
- --------------------------------------------------------------------------------
/s/ FRED M. FERREIRA Chairman of the Board, Chief March 31, 1999
FRED M. FERREIRA Executive Officer and President
/s/ J. GORDON BEITTENMILLER Executive Vice President, Chief March 31, 1999
J. GORDON BEITTENMILLER Financial Officer and Director
(PRINCIPAL ACCOUNTING OFFICER)
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SIGNATURE TITLE DATE
- --------------------------------------------------------------------------------
/s/ MICHAEL NOTHUM, JR. Chief Operating Officer and March 31, 1999
MICHAEL NOTHUM, JR. Director
/s/ STEVEN S. HARTER Director March 31, 1999
STEVEN S. HARTER
/s/ BRIAN S. ATLAS Director March 31, 1999
BRIAN S. ATLAS
/s/ THOMAS J. BEATY Director March 31, 1999
THOMAS J. BEATY
/s/ ROBERT R. COOK Director March 31, 1999
ROBERT R. COOK
/s/ ALFRED J. GIARDENELLI, JR. Director March 31, 1999
ALFRED J. GIARDENELLI, JR.
/s/ SALVATORE P. GIARDINA Director March 31, 1999
SALVATORE P. GIARDINA
/s/ CHARLES W. KLAPPERICH Director March 31, 1999
CHARLES W. KLAPPERICH
/s/ SAMUEL M. LAWRENCE Director March 31, 1999
SAMUEL M. LAWRENCE III
/s/ LARRY MARTIN Director March 31, 1999
LARRY MARTIN
/s/ JOHN MERCADANTE, JR. Director March 31, 1999
JOHN MERCADANTE, JR.
/s/ JOHN C. PHILLIPS Director March 31, 1999
JOHN C. PHILLIPS
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SIGNATURE TITLE DATE
- --------------------------------------------------------------------------------
/s/ ROBERT J. POWERS Director March 31, 1999
ROBERT J. POWERS
/s/ MARK P. SHAMBAUGH Director March 31, 1999
MARK P. SHAMBAUGH
II-8
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION OF EXHIBIT PAGE
- --------------------------------------------------------------------------------
3.1 Second Amended and Restated Certificate of Incorporated by
Incorporation. reference.
3.2 Certificate of Amendment dated May 21, 1998. Incorporated by
reference.
3.3 Bylaws, as amended. Incorporated by
reference.
4.1 Form of certificate evidencing ownership of Incorporated by
common stock. reference.
5.1 Opinion of William George, Esq., General II-10
Counsel of the Company, re: validity of shares.
21.1 List of Subsidiaries. Incorporated by
reference.
23.1 Consent of Arthur Andersen LLP. II-12
23.2 Consent of Marden Harrison & Kreuter. II-13
23.3 Consent of Crowe, Chizek and Company LLP. II-14
23.4 Consent of William George, Esq. See Exhibit 5.1
filed herewith.
24.1 Power of Attorney. Included as part
of signature page
filed herewith.
II-9
EXHIBIT 5.1
OPINION AND CONSENT OF COUNSEL
[LETTERHEAD]
April 2, 1999
Comfort Systems USA, Inc.
777 Post Oak Blvd., Suite 500
Houston, Texas 77056
Re: COMFORT SYSTEMS USA, INC.
Ladies and Gentlemen:
This opinion is furnished to you in connection with a registration
statement on Form S-4 (the "Registration Statement"), filed with the Securities
and Exchange Commission under the Securities Act of 1933, as amended, for the
registration of 5,000,000 shares of Common Stock, $.01 par value (the "Shares"),
of Comfort Systems USA, Inc., a Delaware corporation (the "Company").
I have acted as counsel for the Company in connection with its proposed
issuance and sale of the Shares. For purposes of this opinion, I have examined
and relied upon such documents, records, certificates and other instruments as I
have deemed necessary.
I express no opinion as to the applicability of compliance with or effect
of Federal law or the law of any jurisdiction other than the corporate laws of
the State of Delaware.
Based on the foregoing, I am of the opinion that the Shares have been duly
authorized and, when the Shares have been issued and sold and the Company has
received the consideration specified in the applicable acquisition agreement
approved by the Board of Directors, the Shares will be validly issued, fully
paid and non-assessable.
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I hereby consent to your filing this opinion as an exhibit to the
Registration Statement and to the use of my name therein and in the related
prospectus under the caption "Validity of Common Stock".
It is understood that this opinion is to be used only in connection with
the offer and sale of the Shares while the Registration Statement is in effect.
Very truly yours,
/s/ WILLIAM GEORGE
William George
II-11
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use of our
report included in this registration statement and to the incorporation by
reference in this registration statement of our report dated February 18, 1999
included in Comfort Systems USA, Inc.'s Form 10-K for the year ended December
31, 1998 and to all references to our Firm included in this registration
statement.
ARTHUR ANDERSEN LLP
/s/ARTHUR ANDERSEN LLP
Houston, Texas
March 26, 1999
II-12
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation by reference in this Form S-4
registration statement of Comfort Systems USA, Inc., of our report dated March
24, 1998 (and to all references to our Firm as they relate to F&G Mechanical
Corp. and affiliate) on the combined financial statements of F&G Mechanical
Corp. and affiliate as of and for the year ended December 31, 1997, included in
Comfort Systems USA, Inc.'s Form 8-K dated April 23, 1998.
MARDEN, HARRISON & KREUTER
Certified Public Accountants
/s/MARDEN, HARRISON & KREUTER
Port Chester, New York
April 1, 1999
II-13
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration
Statement of Comfort Systems USA, Inc. on Form S-4 of our report dated February
24, 1998 relating to the financial statements of Shambaugh & Son, Inc. as of
December 31, 1997 and for the year then ended.
/s/ CROWE, CHIZEK AND COMPANY LLP
April 2, 1999
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