Exhibit 10.38

 
RELEASE AND TERMINATION AGREEMENT dated as of October 5, 2006, among ADVANCE
AUTO PARTS, INC., ADVANCE STORES COMPANY, INCORPORATED (the “Company”) and
JPMORGAN CHASE BANK, N.A., as Administrative Agent under the Credit Agreement
referred to below. Unless otherwise defined herein, capitalized terms shall have
the meanings assigned to such terms in the Credit Agreement referred to below.
 
WHEREAS, pursuant to the Amended and Restated Credit Agreement dated as of
November 3, 2004 (as amended, the “Credit Agreement”), among Advance Auto
Parts, Inc., the Company, the lenders party thereto (the “Lenders”) and JPMorgan
Chase Bank, N.A., as Administrative Agent, the Lenders have extended credit to
the Company, and have agreed to extend credit to the Company, in each case
subject to the terms and conditions set forth therein; and
 
WHEREAS, the Company intends, contemporaneously with the execution of this
Agreement, (a) to terminate all remaining Commitments under the Credit Agreement
and (b) to repay all Loans outstanding under the Credit Agreement to pay all
accrued and unpaid interest and fees payable under the Credit Agreement and to
pay all other monetary obligations of the Company accrued and owing under the
Credit Agreement, including amounts payable pursuant to any indemnity or expense
reimbursement provisions thereof (the amounts described in this clause (b) and
listed in Schedule I hereto being referred to as the “Designated Obligations”);
and
 
WHEREAS, the Designated Obligations as of the date hereof are set forth in
Schedule I hereto;
 
NOW, THEREFORE, in consideration of the payment in full of the Designated
Obligations simultaneously with the execution and delivery of this Agreement:
 
1.  The parties hereto hereby agree that (a) the Commitments are terminated and
the Lenders have no further obligation to extend credit under the Credit
Agreement, (b) all liability of the Company and Holdings and their respective
Subsidiaries in respect of the Designated Obligations is hereby discharged and
paid in full, and (c) the guarantees created under the Guarantee Agreement and
the security interests granted by the Security Documents are hereby terminated
and all liens in respect of the Collateral are hereby released; provided that
(i) the foregoing shall not be construed to relieve any Loan Party from its
obligations under any provisions, including indemnity or expense reimbursement
provisions, of any Loan Document that are specified in such Loan Document to
survive the termination thereof or the repayment of the Designated Obligations
and (ii) it is understood that a portion of the amounts, if any, specified as
“Break Funding Costs” on Schedule I represents an estimate of amounts payable
under Section 2.16 of the Credit Agreement, and the Administrative Agent will
return to the Company any excess of such estimated amount over the amounts
actually owing under such Section 2.16 (and clause (i) above will apply to any
shortfall).
 

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2.  The Administrative Agent, at the Effective Time (as hereinafter defined) and
from time to time as reasonably requested by the Company, on behalf of itself
and the Lenders, shall prepare and file UCC termination statements, mortgage
releases and other similar discharges or assignment documents, in each case, in
form and substance reasonably satisfactory to the Administrative Agent and the
Company, and, in each case, as the Company may reasonably request in connection
with the termination and release of liens and security interests referred to
herein. The Administrative Agent hereby authorizes the Company and the other
Loan Parties to file any UCC termination statements relating to all UCC
financing statements covering any assets of the Company or any other Loan Party
and other appropriate instruments of release, in each case with respect to the
release of the liens and security interests made hereby.
 
3.  The parties hereto acknowledge and confirm that all Letters of Credit shall
remain outstanding subject to the terms and conditions of separate agreements
between the Issuing Bank and the Company now governing the Letters of Credit.
The Issuing Bank hereby consents to the release of (a) the Lenders from their
participations in Letters of Credit under the Credit Agreement and (b) the
security interests and Liens granted pursuant to the Security Documents
described in Section 1.
 
4.  This Agreement shall become effective (the “Effective Time”) only after
(a) counterparts hereof have been executed by the Company and the Administrative
Agent and are in the possession of the Administrative Agent, (b) the
Administrative Agent has received, by wire transfer of immediately available
funds, the aggregate amount of the Designated Obligations, as set forth in
Schedule I hereto and (c) the Credit Agreement dated as of the date hereof among
Holdings, the Company, the lenders party thereto and JPMorgan Chase Bank, N.A.,
as Administrative Agent, shall have become effective.
 
5.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.
 
6.  This Agreement may be executed in any number of counterparts, each of which
shall constitute an original and all of which, when taken together, shall
constitute one agreement. Delivery of an executed counterpart of a signature
page of this Agreement by telecopier or by electronic mail of a PDF copy shall
be effective as delivery of a manually executed counterpart of this Agreement.
 

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

ADVANCE AUTO PARTS, INC.     by             

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  Name: Michael O. Moore
  Title: Executive Vice President, Chief Financial Officer

 

ADVANCE STORES COMPANY, INCORPORATED,      by             

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  Name: Michael O. Moore
  Title: Executive Vice President, Chief Financial Officer

 
 
JPMORGAN CHASE BANK, N.A., as
Administrative Agent and Issuing Bank
under the Credit Agreement,
    by:             

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  Name: Barry Bergman
  Title: Managing Director

 

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Schedule I
   
Designated Obligations
             
Advance Stores Company, Incorporated
   
Termination Agreement
                                 
Loan Type
Component Type
Amount
             
Tranche A Term Loans
Interest
$575,893.50
     
Principal
$147,500,000.00
             
Tranche B Term Loans
& Delayed Draw Term
Loans
Interest
$581,121.39
     
 
Principal
 
$167,025,000.00
$99,250,000.00
             
Revolving Loans
Interest
$73,611.11
     
Principal
$20,000,000.00
     
Commitment Fees
$3,931.68
             
Letters of Credit
Participation Fees
$11,596.62
     
Issuing Bank Fees
$2,318.32
             
Break Funding Costs
TBD
               
Other Expenses
Legal Separate Invoice
                 
Total Designated
Obligations
$435,023,472.62