Exhibit 10.6
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AMENDMENT NO.3
TO NOTE AGREEMENT FOR
7.54% SENIOR NOTES DUE 2011
SUBURBAN PROPANE, L.P.
December 6, 2000
To each of the Holders of the 7.54% Senior Notes due 2011 of Suburban Propane,
L.P.
Ladies and Gentlemen:
Suburban Propane, L.P. (the "Company") has heretofore issued its 7.54%
Senior Notes due June 30, 2011 (the "Notes") in the aggregate principal amount
of $425,000,000 under and pursuant to the Note Agreement, dated as of February
28, 1996, among the Company and the original purchasers of the Notes, as amended
by Amendment No. 1 dated May 13, 1998 and by Amendment No. 2 dated March 29,
1999 (such agreement, as so amended, the "Note Agreement"). Terms used herein
which are defined in the Note Agreement are used herein as so defined.
The Company is desirous of amending the Note Agreement in certain respects
and by this letter is soliciting the consent of the holders of the Notes
thereto.
1. PARAGRAPH 10B. The definition of Consolidated EBITDA set forth in
paragraph 10B of the Note Agreement is amended in its entirety to read, as
follows:
"Consolidated EBITDA" shall mean, for any period, Consolidated Net
Income for such period for the Company or the Division, as the case may be,
computed in accordance with GAAP, plus, to the extent deducted in computing
such Consolidated Net Income after excluding amounts attributable to
minority interests in Subsidiaries and without duplication, the sum of (a)
Consolidated Income Tax Expense, (b) Consolidated Interest Expense, (c)
Consolidated Non-cash charges, (d) restructuring charges (limited, in the
case of cash restructuring charges, to $5,000,000 for any period of twelve
consecutive fiscal quarters) and (e) extraordinary losses during such
period for the Company or the Division, as the case may be, MINUS, to the
extent added in computing such Consolidated Net Income and without
duplication, (i) interest income and (ii) extraordinary gains during such
period; PROVIDED, that Consolidated EBITDA shall exclude all unrealized
gains and unrealized losses, recorded as required by FASB Statement of
Financial Accounting Standards No. 133 in connection with Hedging
Transactions (as defined in paragraph 6N).
2. PARAGRAPH 6N. Paragraph 6 of the Note Agreement is hereby amended by
adding a new paragraph 6N thereto reading as follows:
6N. RESTRICTIONS ON HEDGING TRANSACTIONS. The Company will not and
will not permit any Subsidiary to enter into Hedging Transactions with
respect to crude oil, natural gas or liquid hydrocarbons other than Hedging
Transactions up to and including the Adjusted Gas Volume. "Adjusted Gas
Volume" for the period of the four most recent fiscal quarters ending on or
prior to the date of determination, shall mean 75% of the Company's and its
Subsidiaries' pro rata share of gas sales volume. "Hedging Transactions"
shall mean, with respect to the Company and its Subsidiaries, any commodity
basis swap, forward commodity transaction, commodity swap, commodity
option, commodity index swap, commodity cap transaction, commodity floor
transaction, commodity collar transaction, any other similar transaction
that relates to commodities (including, any option with respect to any of
the foregoing transactions) or any combination of the foregoing
transactions. At the same time it delivers the financials statements
required by paragraphs 5A(i) and 5A(ii) the Company will deliver to the
holder of each Note a statement detailing (i) its hedge position under
Hedging `Transactions in effect as of the date of the most recent balance
sheet included in such financial statements and (ii) all unrealized gains
and unrealized losses, recorded as required by FASB Statement of Financial
Accounting Standards No. 133 in connection with Hedging Transactions, with
respect to the fiscal period then ended.
3. EFFECTIVENESS. The amendments to the Note Agreement set forth above
shall become effective upon receipt by the Company of counterparts of this
letter executed by the Required Holders. The Company represents and warrants to
the holders of the Notes that no Default or Event of Default exists (nor will
any such Default or Event of Default exist immediately after giving effect to
the effectiveness of this Agreement) and that in connection with this
solicitation of the consents of the holders of the Notes it is in compliance
with the provisions Of paragraph 11C of the Note Agreement. The Company shall
give notice of the effectiveness hereof to all of the holders of the Notes as
provided in the Note Agreement.
4. NOTE AGREEMENT. Except as expressly amended hereby, the Note Agreement
shall continue in full force and effect in accordance with the provisions
thereof.
If you are in agreement with the foregoing, please sign the form of
acceptance on an enclosed counterpart of this letter and return the same to the
Company, whereupon this letter shall become a binding agreement between us
(subject to effectiveness as aforesaid).
SUBURBAN PROPANE, L.P.
By: XXXXXX X. XXXXXX
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Vice President & Treasurer
Amendment No.3 to Note Agreement
For 7.54% Senior Note due 2011
Suburban Propane, L.P.
December 6, 2000
The foregoing letter is
Hereby accepted:
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(Name of Institution)
By:
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Title:
Certificate No. R-
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