As of February 20, 0000
Xxxxxxxx Xxxxxxx, X.X.
Xxxxx 0000, IES tower
000 0xx Xxxxxx, XX
X.X. Xxx 0000
Xxxxx Xxxxxx, XX 00000-0000
Gentlemen:
Reference is made to the Credit Agreement among National Propane, L.P., the
Lenders party thereto and BankBoston, N.A., as Administrative Agent, dated June
26, 1996 (as amended and in effect on the date hereof, the 'Credit Agreement').
Reference is also made to the letter dated January 19, 1999 from the
Administrative Agent and the Lenders to National Propane, L.P. (the 'Waiver
Letter'). All capitalized terms used herein and not otherwise defined shall have
the meanings herein as in the Credit Agreement.
In accordance with the Waiver Letter, on February 20, 1999 the Borrower
furnished Officer's Certificates to the Administrative Agent and the Lenders
with respect to the year ended December, 1998 and the twelve months ended
January, 1999. Pursuant to such Officer's Certificates, the Borrower notified
the Administrative Agent and the Lenders that the Partnership's ratio of Total
Funded Debt to Consolidated Cash Flow as of December 31, 1998, was in excess of
the maximum permitted ratio pursuant to Section 6.31 of the Credit Agreement
(the 'Leverage Ratio Default').
The Borrower has requested that the Administrative Agent and the Lenders
waive the Leverage Ratio Default and any subsequent Default relating to the
Leverage Ratio that may occur with respect to any period ending on or prior to
August 31, 1999. The Administrative Agent and the Lenders are willing to, and do
hereby, agree to such request and waive the Leverage Ratio Default. In addition,
the Administrative Agent and the Lenders hereby waive any other Default under
the Credit Agreement that may occur with respect to the Leverage Ratio for any
period ending on or prior to August 31, 1999 ('Future Leverage Ratio Defaults'),
subject to the Borrower's agreement to the following:
1. On or before April 30, 1999, the Borrower shall deliver to the
Administrative Agent a purchase and sale agreement from a creditworthy buyer, on
terms reasonably satisfactory to the Administrative Agent and the Lenders, for
the sale of the Borrower's business or assets the terms of which shall provide
for repayment in full of all Obligations and the termination of the Credit
Agreement and obligations of the Lenders thereunder (in each case upon closing
of the acquisition).
2. On the 20th day of each month (each a 'Delivery Date') commencing April
20, 1999, the Borrower will deliver to the Administrative Agent and the Lenders
an Officer's Certificate (the 'Status Certificate'), in form and substance
satisfactory to the Administrative Agent and the Lender as to the status of the
proposed sale of the Borrower.
3. On or before September 30, 1999, the sale of the Borrower's business or
assets pursuant to the purchase and sale agreement described in paragraph 1,
above, shall have been consummated, all Obligations to the Administrative Agent
and the Lenders repaid in full and all obligations of the Administrative Agent
and the Lenders under the Credit Agreement and other Loan Documents terminated.
4. The Borrower shall not make any Restricted Payments on its partnership
interests or directly or indirectly (through the Public Partnership) to the
holders of the common units of the Public Partnership until all Obligations have
been repaid in full and all obligations of the Lenders under the Credit
Agreement terminated.
5. (a) The failure of the Borrower to comply with the provisions of
Paragraph 1-4 inclusive, as and when due, or (b) the termination, or breach by
any party, of the purchase and sale agreement described in Paragraph 1 above,
shall each constitute an immediate Event of Default under the Credit Agreement
as of the date of occurrence, without any further action of the Administrative
Agent and the Lenders and without any notice to, or right to cure by, the
Borrower.
6. Notwithstanding anything to the contrary contained in the Credit
Agreement, the Lenders shall hereafter have no commitment to make any Revolving
Loans to the Borrower. Rather, all Revolving Loans to the Borrower shall be
made, if at all, in the sole discretion of the Lenders. No such Revolving Loans
shall be made unless all Lenders agree to do so. The making of such Revolving
Loans on one occasion by the Lenders shall not obligate them to make Revolving
Loans on any other occasion.
7. In consideration of the Lenders delivering this waiver, the Borrower
shall pay the Lenders a waiver fee in the sum of $25,000.00 each,
contemporaneously with the execution of this letter. Such fee shall be fully
earned when paid, shall not be applied in reduction of the Obligations, and
shall not be subject to refund or rebate under any circumstances.
The waivers of the Leverage Ratio Default and Future Leverage Ratio
Defaults pursuant to this letter is limited as provided above and shall not be
deemed to constitute a waiver of any other provision of the Credit Agreement.
With the exception of the limited waiver to the Credit Agreement granted
herein, all terms and conditions of the Credit Agreement remain in full force
and effect.
Very truly yours,
'ADMINISTRATIVE AGENT'
BANKBOSTON, N.A.
By: /s/ Xxxxxxxxxxx Xxxxxxxx
.................................
Name: Xxxxxxxxxxx Xxxxxxxx
Title: Director
'LENDERS'
BANKBOSTON, N.A.
By: /s/ Xxxxxxxxxxx Xxxxxxxx
.................................
Name: Xxxxxxxxxxx Xxxxxxxx
Title: Director
UNION BANK OF CALIFORNIA, N.A.
By: /s/ Xxxxxx X. Xxxx
.................................
Name: XXXXXX X. XXXX
Title: VICE PRESIDENT
BANK OF AMERICA NT & SA
By: /s/ Xxxxxx Xxxxxx
.................................
Name: Xxxxxx Xxxxxx
Title: Senior Vice President
AGREED:
NATIONAL PROPANE, L.P.
By: /s/ R. Xxxxxx Xxxxxxx
..................................
Name: R. Xxxxxx Xxxxxxx
Title: Vice President and CFO
