AMENDMENT NO. 4 TO THE CREDIT AGREEMENT

EX-10.1 2 aap_exhibit1001x12302023.htm EX-10.1 Document

Exhibit 10.1

EXECUTION COPY

AMENDMENT NO. 4 TO THE
CREDIT AGREEMENT

Dated as of February 26, 2024

AMENDMENT NO. 4 TO THE CREDIT AGREEMENT (this “Amendment”) among ADVANCE AUTO PARTS, INC., a Delaware corporation (the “Borrower”), ADVANCE STORES COMPANY, INCORPORATED, a Virginia corporation (the “Company”), the LENDERS party hereto, and BANK OF AMERICA, N.A., as Administrative Agent.

PRELIMINARY STATEMENTS:

(1) The Borrower, the Company, the Lenders and the Administrative Agent have entered into a Credit Agreement dated as of November 9, 2021 (as amended by Amendment No. 1 dated as of February 27, 2023, Amendment No. 2 dated as of August 21, 2023 and Amendment No. 3 dated as of November 20, 2023, the “Credit Agreement”). Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit Agreement.

(2) The Borrower has requested certain amendments to the Credit Agreement, and the parties hereto agree to such amendments as set forth in, and in accordance with the terms and conditions of, this Amendment (the Credit Agreement as so amended, the “Amended Credit Agreement”).

SECTION 1. Amendments to Credit Agreement. As of the date first above written but subject to the satisfaction of the conditions precedent set forth in Section 2 below, the Required Lenders and the Borrower hereby agree to amend the Credit Agreement as follows:

(a) Clause (e) of the definition of “Consolidated EBITDA” in Section 1.01 of the Credit Agreement is amended in full to read as follows:

(e) other non-cash charges for such period provided there shall be (i) excluded from non-cash charges referred to this clause (e) (A) any non-cash charges that constitute accruals of or reserves for future cash payments and (B) except as provided in clause (ii) below, write-downs or write-offs of inventory or accounts receivable and (ii) included in non-cash charges referred to in this clause (e) (A) write-downs of inventory in an amount not to exceed (x) $125,000,000 for the fiscal quarter ended October 7, 2023 and (y) $71,000,000 for the fiscal quarter ended December 30, 2023, (B) write downs of vendor accounts receivable not to exceed $20,000,000 for the fiscal quarter ended December 30, 2023, and (C) write downs of inventory due to consolidation of distributions centers not to exceed (x) $10,000,000 for the fiscal quarter ended July 13, 2024 and (y) $15,000,000 for the fiscal quarter ended October 25, 2024,

(b) the definition of “Consolidated Net Tangible Assets” in Section 1.01 of the Credit Agreement is deleted in full.

(c) Section 6.01(f) of the Credit Agreement is amended by deleting the phrase “10% of Consolidated Net Tangible Assets” and substituting therefor the figure “$400,000,000”.

(d) Section 6.01(i) of the Credit Agreement is deleted in full and replaced with “[reserved]”.

(e) Section 6.02(a)(vi) of the Credit Agreement is deleted in full and replaced with “[reserved]”.

(f) Section 6.02(a)(viii) of the Credit Agreement is amended by deleting the phrase “10% of Consolidated Net Tangible Assets” and substituting therefor the figure “$400,000,000”.

(g) Section 6.06(vi) of the Credit Agreement is deleted in full and replaced with “[reserved]”.

SECTION 2. Conditions of Effectiveness of Section 1. Section 1 of this Amendment shall become effective, as of the date first above written, on the date on which each of the following conditions precedent shall have been satisfied or waived:

(a) The Administrative Agent shall have received counterparts of this Amendment executed by the Borrower, the Company and the Required Lenders; and

(b) The Borrower shall have paid all accrued and invoiced fees and expenses of the Administrative Agent and the Lenders associated with this Amendment (including an amendment fee equal to 0.075% of the Commitment of each Lender that executes this Amendment and the accrued and invoiced fees and expenses of Shearman & Sterling LLP, counsel to the Administrative Agent).

SECTION 3. Representations and Warranties of the Borrower. The Borrower represents and warrants as of the date hereof as follows:

(a) no Default exists; and

(b) the representations and warranties contained in Article III of the Credit Agreement and the other Loan Documents are true and correct in all material respects on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects as of such earlier date (other than any such representation and warranty that is already qualified by materiality or “Material Adverse Effect” in the text thereof, in which case such representation and warranty shall be true and correct in all respects), and except that for purposes of this Amendment, the representations and warranties contained in subsections (a) and (c) of Section 3.04 of the Credit Agreement shall be deemed to refer to the most recent statements furnished pursuant to subsections (a) and (b), respectively, of Section 5.01 of the Credit Agreement).

SECTION 4. Reference to and Effect on the Loan Documents. (a) On and after the effectiveness of this Amendment, each reference in the Credit Agreement to “this

Agreement”, “hereunder”, “hereof” or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to “the Credit Agreement”, “thereunder”, “thereof” or words of like import referring to the Credit Agreement, shall mean and be a reference to the Amended Credit Agreement.

(b) The Credit Agreement and the other Loan Documents, as specifically amended by this Amendment, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed.

(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 any Lender or the Administrative Agent under the Credit Agreement or any other Loan Document, nor constitute a waiver of any provision of the Credit Agreement or any other Loan Document.

(d) This Amendment is subject to the provisions of Section 9.02 of the Credit Agreement and shall be deemed to constitute a Loan Document.

SECTION 5. Costs and Expenses. The Borrower shall pay all reasonable out-of-pocket expenses incurred by the Administrative Agent and its Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent, in connection with the preparation and administration of this Amendment in accordance with the terms of Section 9.03 of the Credit Agreement.

SECTION 6. Execution in Counterparts. This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.

SECTION 7. Governing Law. This Amendment shall be construed in accordance with and governed by the law of the State of New York.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized officers as of the day and year first above written.


ADVANCE AUTO PARTS, INC.,

	by
		/s/ Anthony A. Iskander
		Name: Anthony A. Iskander
		Title: Senior Vice President, Treasurer

ADVANCE STORES COMPANY, INCORPORATED,

	by
		/s/ Anthony A. Iskander
		Name: Anthony A. Iskander
		Title: Senior Vice President, Treasurer

BANK OF AMERICA, N.A., as Administrative Agent,

	by
		/s/ Priscilla Ruffin
		Name: Priscilla Ruffin
		Title: AVP