EXHIBIT 10.3

AMENDMENT NO. 1 TO CREDIT AGREEMENT

          This Amendment No. 1 to Credit Agreement (this "Amendment")is dated as
of January 21, 2004, by and among THE DAVEY TREE EXPERT COMPANY, an Ohio
corporation ("Borrower"), the banking institutions listed on Schedule 1 to the
Credit Agreement, as hereinafter defined (the "Banks"), and KEYBANK NATIONAL
ASSOCIATION, as agent for the Banks ("Agent").

          WHEREAS, Borrower, Agent and the Banks are parties to a certain Credit
Agreement, dated as of November 8, 2002, as the same may from time to time be
amended, restated or otherwise modified, which provides, among other things, for
revolving loans, letters of credit and other financial accommodations, all upon
certain terms and conditions stated therein (the "Credit Agreement");

          WHEREAS, Borrower, Agent and the Banks desire to amend the Credit
Agreement to modify certain provisions thereof; and

          WHEREAS, each capitalized term used herein shall be defined in
accordance with the Credit Agreement;

          NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained and for other valuable considerations, Borrower,
Agent and the Banks hereby agree as follows:

          1.           Amendment to Definitions.  Article I of the Credit
Agreement is hereby amended to delete the definition of "Letter of Credit
Commitment" therefrom and to insert in place thereof the following:

                       "Letter of Credit Commitment" shall mean the commitment
of Agent, on behalf of the
                        Banks, to issue Letters of Credit in an aggregate
outstanding face amount of up to Forty
                        Million Dollars ($40,000,000), during the Commitment
Period, on the terms and
                        conditions set forth in Section 2.1B hereof.

          2.           Amendment to Financial Covenants. Section 5.7(c) of the
Credit Agreement is hereby amended and restated as follows:

                               (c)           BALANCE SHEET LEVERAGE RATIO.
Borrower shall not suffer or
                         permit at any time the Balance Sheet Leverage Ratio to
exceed 0.55 to 1.00.

          3.           Concurrently with the execution of this Amendment,
Borrower shall:

           (a)           cause Guarantor of Payment to consent and agree to and
acknowledge the terms of this Amendment;

           (b)           pay to Agent, for the pro rata benefit of the Banks, an
amendment fee in the amount of $30,000; and

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           (c)           pay all legal fees and expenses of Agent in connection
with this Amendment.

          4.           Borrower hereby represents and warrants to Agent and the
Banks that (a) Borrower has the legal power and authority to execute and deliver
this Amendment, (b) the officers executing this Amendment have been duly
authorized to execute and deliver the same and bind Borrower with respect to the
provisions hereof, (c) the execution and delivery hereof by Borrower and the
performance and observance by Borrower of the provisions hereof do not violate
or conflict with the organizational agreements of Borrower or any law applicable
to Borrower or result in a breach of any provision of or constitute a default
under any other agreement, instrument or document binding upon or enforceable
against Borrower,  (d) no Default or Event of Default exists under the Credit
Agreement, nor will any occur immediately after the execution and delivery of
this Amendment or by the performance or observance of any provision hereof, (e)
Borrower is not aware of any claim or offset against, or defense or counterclaim
to, any of Borrower's obligations or liabilities under the Credit Agreement or
any Related Writing, and (f) this Amendment constitutes a valid and binding
obligation of Borrower in every respect, enforceable in accordance with its
terms.

          5.           Borrower, by signing below, hereby waives and releases
Agent and each of the Banks and their respective directors, officers, employees,
attorneys, affiliates and subsidiaries from any and all claims, offsets,
defenses and counterclaims of which Borrower is aware, such waiver and release
being with full knowledge and understanding of the circumstances and effect
thereof and after having consulted legal counsel with respect thereto.

          6.           Each reference that is made in the Credit Agreement or
any Related Writing to the Credit Agreement shall hereafter be construed as a
reference to the Credit Agreement as amended hereby. Except as herein otherwise
specifically provided, all provisions of the Credit Agreement shall remain in
full force and effect and be unaffected hereby. This Amendment is a Related
Writing, as defined in the Credit Agreement.

          7.           This Amendment may be executed in any number of
counterparts, by different parties hereto in separate counterparts and by
facsimile signature, each of which when so executed and delivered shall be
deemed to be an original and all of which taken together shall constitute but
one and the same agreement.

          8.           The rights and obligations of all parties hereto shall be
governed by the laws of the State of Ohio, without regard to principles of
conflicts of laws.

[Remainder of page intentionally left blank.]

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          9.           JURY TRIAL WAIVER. BORROWER, AGENT AND EACH OF THE BANKS
HEREBY WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE,
WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG BORROWER, AGENT AND THE
BANKS, OR ANY THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO, OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS
AGREEMENT OR ANY NOTE, OR OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO.

 

 

 

THE DAVEY TREE EXPERT COMPANY

By: /s/ David E. Adante                                

 

 

         David E. Adante, Executive Vice
         President, Chief Financial Officer and
         Secretary

 

 

 

 

 

and /s/ Bradley L. Comport                          

 

 

         Bradley L. Comport, Treasurer

 

 

 

 

 

KEYBANK NATIONAL ASSOCIATION,
as Agent and as Bank

By: /s/ Donald B. Hayes, Jr.                           

 

 

         Donald B. Hayes, Jr.,
         Senior Vice President

 

 

 

 

 

NATIONAL CITY BANK

By: /s/ Jennifer C. Simpson                            

 

 

         Jennifer C. Simpson, AVP

 

 

 

 

 

FIRST MERIT BANK, N.A.

By: /s/ Kathryn B. Nielsen                           

 

 

         Kathryn B. Nielsen, Vice President

 

 

 

 

 

WELLS FARGO BANK, NATIONAL ASSOCIATION

By: /s/ Andrew T. Cavallari                         

 

 

         Andrew T. Cavallari, Vice President

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GUARANTOR ACKNOWLEDGMENT AND AGREEMENT

          The undersigned consents and agrees to and acknowledges the terms of
the foregoing Amendment No. 1 to Credit Agreement. The undersigned further
agrees that the obligations of the undersigned pursuant to the Guaranty of
Payment of Debt executed by the undersigned shall remain in full force and
effect and be unaffected hereby.

          The undersigned hereby waives and releases Agent and each of the Banks
and their respective directors, officers, employees, attorneys, affiliates and
subsidiaries from any and all claims, offsets, defenses and counterclaims of
which the undersigned is aware, such waiver and release being with full
knowledge and understanding of the circumstances and effect thereof and after
having consulted legal counsel with respect thereto.

          JURY TRIAL WAIVER. THE UNDERSIGNED, AGENT AND EACH OF THE BANKS HEREBY
WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE, AMONG BORROWER, THE UNDERSIGNED, AGENT
AND THE BANKS, OR ANY THEREOF, ARISING OUT OF, IN CONNECTION WITH, RELATED TO,
OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS
AGREEMENT OR ANY NOTE OR OTHER INSTRUMENT, DOCUMENT OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO.

 

 

 

DAVEY TREE SURGERY COMPANY

By: /s/ David E. Adante                                

 

 

         David E. Adante, Executive Vice
         President and Chief Financial Officer

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