EXHIBIT 10.38
SECOND AMENDMENT AND CONSENT dated as of December 1, 1999
(this "Amendment"), to the Credit Agreement dated as of April 15,
1998 as amended and restated as of October 19, 1998 (as further
amended or otherwise modified, the "Credit Agreement"), among
ADVANCE HOLDING CORPORATION, ADVANCE STORES COMPANY,
INCORPORATED, the Lenders party thereto and THE CHASE MANHATTAN
BANK, as Administrative Agent.
WHEREAS, the Borrower (such term and each other capitalized term used
but not defined herein having the meanings assigned to such terms in the Credit
Agreement) has requested that the Lenders approve an amendment to the Credit
Agreement; and
WHEREAS, the undersigned Lenders are willing, on the terms and subject
to the conditions set forth herein, to approve such amendments;
NOW, THEREFORE, in consideration of these premises, the Borrower and
the undersigned Lenders hereby agree as follows:
SECTION 1. Amendments.
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(a) Section 1.01 of the Credit Agreement is hereby amended by
deleting clause (ii)(B) of the third proviso in the definition of the term
"Adjusted Consolidated Net Income" and substituting in lieu thereof the
following:
(B) Acquisition Expenses incurred from and including October 19, 1998
to and including January 1, 2000 in an aggregate amount not to exceed
$36,600,000,
(b) Section 1.01 of the Credit Agreement is hereby amended by
deleting the defined terms "GE Capital Program Agreements" and "GE Capital
Program Indebtedness" and substituting in lieu thereof the following:
"GE Capital Program Agreements" means (a) the Commercial Credit
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Program Agreement dated as of November 22, 1996 among Holdings, the
Borrower and General Electric Capital Corporation, as such agreement
may have been or may hereafter be
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amended, restated, supplemented or modified from time to time in
accordance with Section 6.10 hereof and (b) any agreements entered
into by Holdings, the Borrower and any financial institution in
replacement of such agreement referred to in clause (a) above,
provided that such replacement agreements are, in the aggregate, no
more adverse to the interests of the Borrower or the Lenders than the
agreement referred to in clause (a) above, except that the accounts
receivable transferred as of the date of the effectiveness of such
replacement agreements may be fully guaranteed by the Borrower.
"GE Capital Program Indebtedness" means Indebtedness of the
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Borrower arising under the GE Capital Program Agreements in an
aggregate principal amount not exceeding the amounts permitted
pursuant to Section 6.01(a)(ix).
(c) Section 1.01 of the Credit Agreement is hereby amended by
deleting the defined term "New Receivables Indebtedness" and substituting
in lieu thereof the following:
"New Receivables Indebtedness" means Indebtedness of the Borrower
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and/or its Subsidiaries arising from the New Receivables Program in an
aggregate principal amount not exceeding, at any time, (a) the sum of
(i) 3.5% of the total aggregate amount of all accounts receivables
sold or transferred during the preceding 12-month period by the
Borrower and its Subsidiaries to any Person other than the Borrower
and its Subsidiaries pursuant to the New Receivables Program or for
which value has been received from any Person other than the Borrower
and its Subsidiaries pursuant to the New Receivables Program and (ii)
$3,000,000 or (b) the amounts permitted pursuant to Section
6.01(a)(ix).
(d) Section 6.01(a) of the Credit Agreement is hereby amended by (i)
adding the word "and" at the end of clause (viii) thereof and (ii) deleting
clauses (ix) and (x) thereof and substituting in lieu thereof the
following:
(ix)(A) GE Capital Program Indebtedness and (B) New Receivables
Indebtedness; provided that the aggregate principal amount of
Indebtedness described in clauses (A) and (B) shall not exceed
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(x) $25,000,000 at any time outstanding prior to January 1, 2001 and
(y) $45,000,000 at any time outstanding thereafter.
SECTION 2. Consent. The Required Lenders hereby consent to the
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execution of an amendment to the Security Agreement by the Borrower, Holdings,
the Subsidiaries parties thereto and the Collateral Agent to exclude accounts
receivable sold or created pursuant to the New Receivables Program from the
definitions of the defined terms "Accounts" and "General Intangibles".
SECTION 3. Representations and Warranties. The Borrower represents
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and warrants to each of the Lenders that, after giving effect to the amendments
contemplated hereby, (a) the representations and warranties of each Loan Party
set forth in the Loan Documents are true and correct in all material respects on
and as of the date of this Amendment, except to the extent such representations
and warranties expressly relate to an earlier date (in which case such
representations and warranties were true and correct in all material respects as
of the earlier date) and (b) no Default has occurred and is continuing.
SECTION 4. Effectiveness. This Amendment shall be deemed to be
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effective as of December 1, 1999 on the date (the "Amendment Effective Date")
when the Administrative Agent (or its counsel) shall have received copies hereof
that, when taken together, bear the signatures of the Borrower, Holdings and the
Required Lenders.
SECTION 5. Applicable Law. This Amendment shall be construed in
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accordance with and governed by the law of the State of New York.
SECTION 6. No Other Amendments. Except as expressly set forth
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herein, this Amendment shall not by implication or otherwise limit, impair,
constitute a waiver of, or otherwise affect the rights and remedies of any party
under the Credit Agreement, nor alter, modify, amend or in any way affect any of
the terms, conditions, obligations, covenants or agreements contained in the
Credit Agreement, all of which are ratified and affirmed in all respects and
shall continue in full force and effect. This Amendment shall apply and be
effective only with respect to the provisions of the Credit Agreement
specifically referred to herein.
SECTION 7. Counterparts. This Amendment may be executed in two or
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more counterparts, each of which shall constitute an original, but all of which
when taken together
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shall constitute but one contract. Delivery of an executed counterpart of a
signature page of this Amendment by facsimile transmission shall be as effective
as delivery of a manually executed counterpart of this Amendment.
SECTION 8. Headings. Section headings used herein are for
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convenience of reference only, are not part of this Amendment and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Amendment.
SECTION 9. Expenses. The Borrower shall reimburse the Administrative
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Agent for its reasonable out-of-pocket expenses incurred in connection with this
Amendment, including the reasonable fees and expenses of Cravath, Swaine &
▇▇▇▇▇, counsel for the Administrative Agent.
IN WITNESS WHEREOF, Holdings, the Borrower and the undersigned Lenders
have caused this Amendment to be duly executed by their duly authorized
officers, all as of the date first above written.
ADVANCE HOLDING CORPORATION,
by /s/ J. O'▇▇▇▇ ▇▇▇▇▇▇▇▇
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Name: J. O'▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: SVP/CFO
ADVANCE STORES COMPANY,
by /s/ J. O'▇▇▇▇ ▇▇▇▇▇▇▇▇
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Name: J. O'▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: SVP/CFO
THE CHASE MANHATTAN BANK,
by /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director