Exhibit 10.4
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AMENDMENT NO. 1
TO NOTE AGREEMENT FOR
7.54% SENIOR NOTES DUE 2011
SUBURBAN PROPANE, L.P.
May 13, 1998
To each of the Holders of the
7.45% 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 (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.
Subject to the provisions of Section 3 hereof, the Note Agreement is
amended as herein set forth.
1. XXXXXXXXX 0X. The second paragraph of paragraph 6A of the Note Agreement
is amended in its entirety to read as follows:
Notwithstanding any of the provisions of this Agreement, the Company
will not, and will not permit any Restricted Subsidiary to, enter into any
transaction pursuant to paragraph 50, paragraph 6B, clauses (vii) and
(viii) of xxxxxxxxx 0X, xxxxxxxxx 0X, clauses (i) (b), (i) (c), (ii) (b)
and (iii) of paragraph 6G and paragraph 6I, if the consummation of any such
transaction would result in a violation of clause (ii) of this paragraph
6A, calculated for such purpose as of the date on which such transaction
were to be consummated, both immediately before and after giving effect to
the consummation of such transaction. All such calculations shall be made
on a PRO FORMA basis in accordance with GAAP after giving effect to any
such transaction, with the ratio recomputed as at the last day of the most
recently ended fiscal quarter of the Company as if such transaction had
occurred on the first day of the relevant four quarter period.
2. PARAGRAPH 6E. Subparagraph 6E(iii) of the Note Agreement is amended by
(i) deleting the word "and" at the end of clause (f), relettering clause (g) as
clause (h), and inserting a new clause (g) as follows:
(g) money market funds having assets of not less than $500,000,000; and
3. PARAGRAPH 10B. The definitions of Consolidated EBITDA and Consolidated
Net Income set forth in paragraph lOB of the Note Agreement are amended in their
entirety to read, respectively, 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 $6,900,000 for any period which
includes the fiscal quarter ended June 28, 1997, and to $5,000,000 for any
subsequent 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. See paragraph 10C.
"CONSOLIDATED NET INCOME" shall mean the net income of the Company and
the Restricted Subsidiaries, or the Division, as the case may be, as
determined on a consolidated basis in accordance with GAAP and after
provision for minority interests and as adjusted to exclude (i) net
after-tax extraordinary gains or losses, (ii) net after-tax gains or losses
attributable to Asset Sales, (iii) the net income or loss of any Person
which is not a Restricted Subsidiary and which is accounted for by the
equity method of accounting, provided that Consolidated Net Income shall
include the amount of cash dividends or distributions actually paid to the
Company or any Restricted Subsidiary, (iv) the net income of any Restricted
Subsidiary to the extent that dividends or distributions of such net income
are not at the date of determination permitted by the terms of its charter
or any agreement, instrument, judgment, decree, order, statute, rule or
other regulation and (v) the cumulative effect of any changes in accounting
principles. See paragraph 10C.
4. PARAGRAPH 10C. Paragraph 1OC of the Note Agreement is amended by
inserting a new sentence at the end of clause (ii) thereof reading as follows:
Furthermore, the ratio of Consolidated Total Indebtedness to EBITDA
(and the constituent definitions thereof) shall be computed and calculated
(in accordance with GAAP) in all events for any period on a PRO FORMA basis
to give effect to acquisitions and dispositions of businesses occurring
during such period as if such acquisition or disposition, as the case may
be, occurred on the first day of such period.
5. 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 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.
6. 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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Title: Treasurer
The foregoing letter
Is hereby accepted:
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(Name of Institution)
By:
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Title:
