Company: SPH
Filing Date: 2025-02-06
Form Type: 10-Q
Source: 0000950170-25-015135
Chunk: 105

Company: SUBURBAN PROPANE PARTNERS LP
Filing Date: 2025-02-06
Form: 10-Q
Item: Part I, Item 4
Chunk 105
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 senior notes and the revolving credit facility as of September 28, 2024. 

The Green Bonds contain various restrictive and affirmative covenants applicable to SuburbanRNG - Stanfield, including (i) restrictions on the incurrence of additional indebtedness and (ii) restrictions on certain liens, investments, guarantees, loans, advances, payments, mergers, consolidations, distributions, sales of assets and other transactions.  The Green Bonds contain a financial covenant requiring SuburbanRNG - Stanfield’s debt service coverage ratio, as defined therein, to be not less than 1.00 to 1.00 for any fiscal quarter.  SuburbanRNG – Stanfield did not comply with this ratio for the period ended December 28, 2024, September 28, 2024 and the interim periods during fiscal 2024 which, if not waived, would constitute an event of default under the terms of the Green Bonds.  SuburbanRNG – Stanfield and the Partnership obtained a waiver of this non-compliance from the holders of a majority of the outstanding Green Bonds.  Under the terms of the Credit Agreement, certain events of default under the terms of the Green Bonds constitute an event of default under the Credit Agreement.  The Partnership obtained a waiver from the lenders and the administrative agent under the Credit Agreement for the corresponding event of default under the Credit Agreement resulting from the event of default under the Green Bonds. 

While we currently anticipate that SuburbanRNG – Stanfield will regain compliance with the debt service coverage ratio prior to the end of our second fiscal quarter of 2025, the next compliance measurement date, if SuburbanRNG – Stanfield is unable to regain compliance it will be required to seek another waiver from the holders of at least a majority of the Green Bonds to avoid an event of default under the Green Bonds. 

The amount and terms of our debt may also adversely affect our ability to finance future operations and capital needs, limit our ability to pursue acquisitions and other business opportunities and make our results of operations more susceptible to adverse economic and 

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industry conditions.  In addition to our outstanding indebtedness, we may in the future require additional debt to finance acquisitions or for general business purposes; however, credit market conditions may impact our ability to access such financing.  If we are unable to access needed financing or to generate sufficient cash from operations, we may be required to abandon certain projects or curtail capital expenditures.  Additional debt, where it is