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Exhibit 10.4    
    

 
 

Thomas N. Tanner    

COMFORT SYSTEMS USA, INC.

2000 Equity Incentive Plan  

 
 

Restricted Stock Award Agreement    

Comfort
Systems USA, Inc.

777 Post Oak Blvd, 5th Floor

Houston, TX 77056 

Ladies
and Gentlemen: 

        The
undersigned (i) acknowledges that he has received an award (the "Award") of restricted stock from Comfort Systems USA, Inc., a Delaware corporation (the "Company")
under the 2000 Equity Incentive
Plan (the "Plan"), subject to the terms set forth below and in the Plan; (ii) further acknowledges receipt of a copy of the Plan as in effect on the date hereof; and (iii) agrees with
the Company as follows: 

	1.
	Effective Date.    This Agreement shall take effect as of June 8, 2004, which is the date of grant of the Award.

	2.
	Shares Subject to Award.    The Award consists of 30,000 shares (the "Shares") of common stock of the Company ("Stock"). The
undersigned's rights to the Shares are subject to the restrictions described in this Agreement and the Plan (which is incorporated herein by reference with the same effect as if set forth herein in
full) in addition to such other restrictions, if any, as may be imposed by law.

	3.
	Meaning of Certain Terms.    Except as otherwise expressly provided, all terms used herein shall have the same meaning as in
the Plan. The term "vest" as used herein with respect to any Share means the lapsing of the restrictions described herein and in the Plan with respect to such Share.

	4.
	Nontransferability of Shares.    The Shares acquired by the undersigned pursuant to this Agreement shall not be sold,
transferred, pledged, assigned or otherwise encumbered or disposed of except as provided below and in the Plan.

	5.
	Forfeiture Risk.    Except as provided in Section 7(b) of this Agreement, if the undersigned ceases to be employed by
the Company and its subsidiaries for any reason, including death, any then unvested Shares acquired by the undersigned hereunder shall be immediately forfeited. The undersigned hereby
(i) appoints the Company as the attorney-in-fact of the undersigned to take such actions as may be necessary or appropriate to effectuate a transfer of the record
ownership of any such shares that are unvested and forfeited hereunder, (ii) agrees to deliver to the Company, as a precondition to the issuance of any certificate or certificates with respect
to unvested Shares hereunder, one or more stock powers, endorsed in blank, with respect to such Shares, and (iii) agrees to sign such other powers and take such other actions as the Company may
reasonably request to accomplish the transfer or forfeiture of any unvested Shares that are forfeited hereunder.

	6.
	Retention of Certificates.    Any certificates representing unvested Shares shall be held by the Company. The undersigned
agrees that the Company may give stop transfer instructions to the depository to ensure compliance with the provisions hereof. 

 

	7.
	Vesting of Shares.    The shares acquired hereunder shall vest in accordance with the provisions of this Paragraph 7
and applicable provisions of the Plan, as follows: 

        (a)   If
the Committee determines that, for the period from July 1, 2004 through June 30, 2005, the Company did not have positive earnings from its continuing
operations, all as determined and reported in accordance with generally accepted accounting principles in the Company's regularly prepared financial statements, Employee shall immediately and
irrevocably forfeit all of the Shares. 

        (b)   If
and only if the positive earnings goal in Section 7(a) has been achieved, and provided that the undersigned is then, and since the date of grant has
continuously been employed by the Company or its subsidiaries, then the Shares shall vest as follows: 

7,500
Shares on August 5, 2005; 

an
additional 7,500 Shares on June 8, 2006; 

an
additional 7,500 Shares on June 8, 2007; and 

an
additional 7,500 Shares on June 8, 2008. 

provided, however, that, not withstanding (a) or (b) above, any unvested Shares that have not earlier been forfeited shall vest
immediately in the event of (i) a "Change in Control" as defined in the Employment Agreement dated January 1, 2004 between the undersigned and the Company (the "Employment Agreement") or
(ii) the termination by the Company of executive without cause as defined in the Employment Agreement. 

	8.
	Legend.    Any certificates representing unvested Shares shall be held by the Company, and any such certificate shall contain
a legend substantially in the following form: 

THE
TRANSFERABILITY OF THIS CERTIFICATE AND THE SHARES OF STOCK REPRESENTED HEREBY ARE SUBJECT TO THE TERMS AND CONDITIONS (INCLUDING FORFEITURE) OF THE COMPANY'S 2000 EQUITY INCENTIVE PLAN AND A
RESTRICTED STOCK AWARD AGREEMENT ENTERED INTO BETWEEN THE REGISTERED OWNER AND COMFORT SYSTEMS USA, INC. COPIES OF SUCH PLAN AND AGREEMENT ARE ON FILE IN THE OFFICES OF COMFORT SYSTEMS
USA, INC. 

As
soon as practicable following the vesting of any such Shares the Company shall cause a certificate or certificates covering such Shares to be delivered to the undersigned. 

	9.
	Dividends, etc..    The undersigned shall be entitled to (i) receive any and all dividends or other distributions paid
with respect to those Shares of which he is the record owner on the record date for such dividend or other distribution, and (ii) vote any Shares of which he is the record owner on the record
date for such vote; provided, however, that any property (other than cash) distributed with respect to a share of Stock (the "associated share")
acquired hereunder, including without limitation a distribution of Stock by reason of a stock dividend, stock split or otherwise, or a distribution of other securities with respect to an associated
share, shall be subject to the restrictions of this Agreement in the same manner and for so long as the associated share remains subject to such restrictions, and shall be promptly forfeited to the
Company if and when the associated share is so forfeited; and further provided, that the Administrator may require that any cash distribution with
respect to the Shares other than a normal cash dividend be placed in escrow or otherwise made subject to such restrictions as the Administrator deems appropriate to carry out the intent of the Plan.
References in this Agreement to the Shares shall refer, mutatis mutandis, to any such restricted amounts. 

2

 

	10.
	Sale of Vested Shares.    The undersigned understands that he will be free to sell any Share once it has vested, subject to
(i) satisfaction of any applicable tax withholding requirements with respect to the vesting or transfer of such Share; (ii) the completion of any administrative steps (for example, but
without limitation, the transfer of certificates) that the Company may reasonably impose; and (iii) applicable company policies and the requirements of federal and state securities laws.

	11.
	Certain Tax Matters.    The undersigned expressly acknowledges the following:

	a.
	The
undersigned has been advised to confer promptly with a professional tax advisor to consider whether the undersigned should make a so-called "83(b) election" with
respect to the Shares. Any such election, to be effective, must be made in accordance with applicable regulations and within thirty (30) days following the date of this award. The Company has
made no recommendation to the undersigned with respect to the advisability of making such an election.

	b.
	The
award or vesting of the Shares acquired hereunder, and the payment of dividends with respect to such shares, may give rise to "wages" subject to withholding. The undersigned
expressly acknowledges and agrees that his rights hereunder are subject to his paying to the Company in cash (or by such other means as may be acceptable to the Company in its discretion, including,
if the Committee so determines, by the delivery of previously acquired Stock or shares of Stock acquired hereunder or by the withholding of amounts from any payment hereunder) all taxes required to be
withheld in connection with such award, vesting or payment. 

	 	 	 	 	 	 	Very truly yours,
	

 	
 	

 	
 	

 	
 	

/s/  THOMAS N. TANNER      
 Thomas N. Tanner
	

The foregoing Restricted Stock Award Agreement is hereby accepted:	
 	

 
	

COMFORT SYSTEMS USA, INC.	
 	

 
	

By	
 	

/s/  WILLIAM F. MURDY      
	
 	

 
	

 	
 	

 	
 	

William F. Murdy

Chief Executive Officer	
 	

 

3

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Exhibit 10.4

Thomas N. Tanner

Restricted Stock Award AgreementQuickLinks
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Exhibit 10.5    
    

 
 

FIRST AMENDMENT TO
  AMENDED RESTATED CREDIT AGREEMENT    
    

        THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (the "Amendment") is made and entered into effective
as of May 12, 2004, by and among COMFORT SYSTEMS USA, INC., Delaware corporation ("Borrower"); BANK OF TEXAS NA, individually and as Administrative Agent ("Administrative Agent");
HIBERNIA NATIONAL BANK, as Documentation Agent; and the Lenders ("Lenders") and Guarantors ("Guarantors") set forth on the signature pages hereto. 

R E C I T A L S:  

        WHEREAS, Borrower, the Administrative Agent, the Document Agent and the Lenders entered into an Amended and Restated Credit Agreement dated December 31,
2003 (which as the same may be amended from time to time is herein called the "Credit Agreement"), pursuant to which Borrower amended and restated the
Prior Credit Documents; and 

        WHEREAS,
Borrower, Administrative Agent, Document Agent, Lenders and Guarantors desire to amend the Credit Agreement as herein set forth. 

        NOW
THEREFORE, in consideration of the premises herein contained and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows: 

        1.     Definitions.    Except as otherwise provided below, unless the context hereof indicates otherwise, all
capitalized terms used herein shall have the same meaning as such capitalized terms are defined in the Credit Agreement. 

        2.     Amendments to the Credit Agreement.    The Credit Agreement is, effective the date hereof, and subject to the
satisfaction of the conditions precedent set forth in Section 3 hereof, amended by deleting Section 2.12 in its entirety and substituting the following: 

        "Section 2.12.    Letter of Credit Fees.    In consideration of LC Issuer's issuance of any Letter of Credit,
Borrower agrees to pay (a) to Administrative Agent, for the account of all Lenders in accordance with their respective Percentage Shares, a per annum letter of credit issuance fee at a rate
equal to 75% of the Eurodollar Margin in effect for Revolving Loans, and (b) to such LC Issuer for its own account, a letter of credit fronting fee at a rate equal to 0.125% per annum. The
letter of credit fee and the letter of credit fronting fee will be calculated on the undrawn face amount of each Letter of Credit outstanding on each day at the above-applicable rates and will be due
and payable in arrears on the first day of each Fiscal Quarter and at the end of the Commitment Period." 

        3.     Conditions Precedent to Effectiveness of Amendment.    This Amendment shall become effective when, and only
when, the Administrative Agent shall have received counterparts of this Amendment executed by Borrower, the Guarantors and all of the Lenders. 

        4.     Representations and Warranties of Borrower.    Borrower represents and warrants as follows: 

        (a)   Borrower
is duly authorized and empowered to execute, deliver and perform this Amendment and all other instruments referred to or mentioned herein to which it is a
party, and all action on its part requisite for the due execution, delivery and the performance of this Amendment has been duly and effectively taken. This Amendment, when executed and delivered, will
constitute valid and binding obligations of Borrower, enforceable against it in accordance with its terms. This Amendment does not violate any provisions of the organizational documents of Borrower,
or any material contract, agreement, law or regulation to which Borrower is subject, and does not require the consent or approval of any regulatory authority or governmental body of the United States
or any state; and 

 

        (b)   When
duly executed and delivered, each of this Amendment and the Credit Agreement will be legal and binding obligations of Borrower, enforceable in accordance with their
respective terms, except as limited by bankruptcy, insolvency or similar laws of general application relating to the enforcement of creditors' rights and by equitable principles of general
application. 

        5.     Representations and Warranties of Guarantors.    Each Guarantor represents and warrants that such Guarantor is
duly authorized and empowered to execute, deliver and perform this Amendment and all other instruments referred to or mentioned herein to which it is a party, and all action on its part requisite for
the due execution, delivery and the performance of this Amendment has been duly and effectively taken. This Amendment does not violate any provisions of the organizational documents of such Guarantor,
or any material contract, agreement, law or regulation to which Guarantor is subject, and does not require the consent or approval of any regulatory authority or governmental body of the United States
or any state. 

        6.     Reference to and Effect on the Loan Documents. 

        (a)   Upon
the effectiveness of this Amendment, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or words of like import, and each
reference in the Loan Documents shall mean and be a reference to the Credit Agreement as amended hereby. 

        (b)   Except
as specifically amended above, the Credit Agreement and the Notes, and all other Loan Documents shall remain in full force and effect and are hereby ratified and
confirmed. Without limiting the generality of the foregoing, the Security Documents and all collateral described therein do and shall continue to secure the payment of all obligations of Borrower
under the Credit Agreement as amended hereby, and the Note(s), and under the other Security Documents. 

        (c)   The
execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of Lender
under any of the Security Documents, nor constitute a waiver of any provision of any of the Security Documents. 

        7.     Execution in Counterparts.    This Amendment may be executed in any number of counterparts and by different
parties hereto in separate counterparts, 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
instrument. 

        8.     Governing Law.    This Amendment shall be governed by and construed in accordance with the laws of the State of
Texas. 

        9.     Final Agreement.    THIS WRITTEN AMENDMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.

        IN
WITNESS WHEREOF, the parties hereto have caused this instrument to be duly executed in multiple counterparts, each of which is an original instrument for all purposes, all as of the
day and year first above written. 

	 	 	BORROWER:
	

 	
 	

COMFORT SYSTEMS USA, INC.,
	

 	
 	

By:	
 	

/s/  J. GORDON BEITTENMILLER      
 J. Gordon Beittenmiller

Executive Vice President and

Chief Financial Officer
	 	 	 	 	 

2

 

	

 	
 	
LENDERS:
	

 	
 	

BANK OF TEXAS NA

Administrative Agent and Lender
	

 	
 	

By:	
 	

/s/  H. GALE SMITH, JR.      
 H. Gale Smith, Jr.

Senior Vice President
	

 	
 	

HIBERNIA NATIONAL BANK,

Documentation Agent, LC Issuer and Lender
	

 	
 	

By:	
 	

/s/  MICHAEL MEISS      
 Michael Meiss

Senior Vice President
	

 	
 	

BANK OF SCOTLAND, Lender
	

 	
 	

By:	
 	

/s/  JOSEPH FRATUS      
 Joseph Fratus

First Vice President
	

 	
 	

FIRSTCAPITAL BANK, SSB, Lender
	

 	
 	

By:	
 	

/s/  WILLIAM H. FOWLER      
 William H. Fowler

Senior Vice President
	

 	
 	
GUARANTORS:
	

 	
 	

ACI MECHANICAL, INC.
	

 	
 	

ACI MECHANICAL USA, INC.
	

 	
 	

ARC COMFORT SYSTEMS USA, INC.
	

 	
 	

ACCURATE AIR SYSTEMS, L.P.,

by Atlas-Accurate Holdings, L.L.C.,

as general partner
	

 	
 	

ACCU-TEMP GP, INC.

ACCU-TEMP LP, INC.
	

 	
 	

AIR TEMP, INC.
	

 	
 	

ATLAS-ACCURATE HOLDINGS, L.L.C.,

by CS53 Acquisition Corp.,

as acting member
	

 	
 	

ATLAS AIR CONDITIONING COMPANY, L.P., by

Atlas-Accurate Holdings, L.L.C. as general partner
	

 	
 	

BATCHELOR'S MECHANICAL CONTRACTORS, INC.
	 	 	 	 	 

3

 

	

 	
 	

BCM CONTROLS CORPORATION
	

 	
 	

CALIFORNIA COMFORT SYSTEMS USA, INC.
	

 	
 	

CEL, INC.
	

 	
 	

CENTRAL MECHANICAL, INC.
	

 	
 	

CLIMATE CONTROL, INC.
	

 	
 	

COMFORT SYSTEMS USA (ARKANSAS), INC.
	

 	
 	

COMFORT SYSTEMS USA (BALTIMORE), INC.
	

 	
 	

COMFORT SYSTEMS USA (BOWLING GREEN), INC.
	

 	
 	

COMFORT SYSTEMS USA (BRISTOL), INC.
	

 	
 	

COMFORT SYSTEMS USA (CLEVELAND), INC.
	

 	
 	

COMFORT SYSTEMS USA (FLORIDA), INC.
	

 	
 	

COMFORT SYSTEMS USA G.P., INC.
	

 	
 	

COMFORT SYSTEMS USA (HARTFORD), INC.
	

 	
 	

COMFORT SYSTEMS USA (INTERMOUNTAIN), INC.
	

 	
 	

COMFORT SYSTEMS USA NATIONAL ACCOUNTS, LLC,

by Accu-Temp LP, Inc., as acting member
	

 	
 	

COMFORT SYSTEMS USA (SYRACUSE), INC.
	

 	
 	

COMFORT SYSTEMS USA (TEXAS), L.P.,

by Comfort Systems USA G.P., Inc.,

as general partner
	

 	
 	

COMFORT SYSTEMS USA (TWIN CITIES), INC.
	

 	
 	

COMFORT SYSTEMS USA (WESTERN MICHIGAN), INC.
	

 	
 	

CS44 ACQUISITION CORP.
	

 	
 	

CS53 ACQUISITION CORP.
	

 	
 	

DESIGN MECHANICAL INCORPORATED
	

 	
 	

EASTERN HEATING & COOLING, INC.
	

 	
 	

ESS ENGINEERING, INC.
	

 	
 	

GULFSIDE MECHANICAL, INC.
	

 	
 	

H & M MECHANICAL, INC.
	

 	
 	

HELM CORPORATION
	

 	
 	

HESS MECHANICAL CORPORATION
	

 	
 	

INDUSTRIAL COOLING INC.
	 	 	 	 	 

4

 

	

 	
 	

J & J MECHANICAL, INC.
	

 	
 	

JAMES AIR CONDITIONING ENTERPRISE INC.
	

 	
 	

MARTIN HEATING, INC.
	

 	
 	

MECHANICAL SERVICE GROUP, INC.
	

 	
 	

MECHANICAL TECHNICAL SERVICES, L.P.,

by Atlas-Accurate Holdings, L.L.C.,

as general partner
	

 	
 	

MJ MECHANICAL SERVICES, INC.
	

 	
 	

NEEL MECHANICAL CONTRACTORS, INC.
	

 	
 	

NORTH AMERICAN MECHANICAL, INC.
	

 	
 	

QUALITY AIR HEATING & COOLING, INC.
	

 	
 	

S&K AIR CONDITIONING CO., INC.
	

 	
 	

S. I. GOLDMAN COMPANY, INC.
	

 	
 	

S.M. LAWRENCE COMPANY, INC.
	

 	
 	

SA ASSOCIATES, INC.
	

 	
 	

SALMON & ALDER, LLC,

by SA Associates, Inc. as acting member
	

 	
 	

SEASONAIR, INC.
	

 	
 	

SHEREN PLUMBING & HEATING, INC.
	

 	
 	

TARGET CONSTRUCTION, INC.
	

 	
 	

TEMP-RIGHT SERVICE, INC.
	

 	
 	

THE CAPITAL REFRIGERATION COMPANY
	

 	
 	

TRI-CITY MECHANICAL, INC.
	

 	
 	

UNITED ENVIRONMENTAL SERVICES, L.P.,

by Atlas-Accurate Holdings, L.L.C.,

as general partner
	

 	
 	

WESTERN BUILDING SERVICES, INC.
	

 	

 	

By:	

 	

/s/  J. GORDON BEITTENMILLER      
J. GORDON BEITTENMILLER,

Vice President and Assistant Secretary

5

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Exhibit 10.5

FIRST AMENDMENT TO AMENDED RESTATED CREDIT AGREEMENT

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