ex10-1.htm


    
      Exhibit
10.1


       

       

       

      AGREEMENT

       

      This
AGREEMENT (this "Agreement"), dated as of June 25, 2008, is made by and between
ESL Investments, Inc., a Delaware corporation (together with its affiliates,
"ESL"), and AutoZone, Inc., a Nevada corporation (the "Company"). Each of ESL
and the Company is a "Party" and are collectively, the "Parties."

       

      WHEREAS,
as of June 24, 2008, ESL owned, and had the right to vote, that number of shares
of common stock, par value $0.01 per share, of the Company (the "Common Stock"),
set forth on Schedule
A to this Agreement (the "Initial Shares"), which represented in the
aggregate, based on the 63,303,490 shares of Common Stock outstanding as of June
24, 2008, approximately 36.2% of the voting power of the Common Stock;
and

       

      WHEREAS,
ESL and the Company desire to enter into this Agreement in order to set forth
certain understandings and agreements regarding the voting by ESL of any shares
of Common Stock that it may own from time to time in excess of agreed
thresholds, protections for non-ESL stockholders in certain transactions
involving the Company or ESL, as well as certain other matters.

       

      NOW
THEREFORE, in consideration of the mutual covenants and agreements set forth
herein, the Parties agree as follows:

       

      ARTICLE
I

      


      DEFINITIONS

       

      Section
1.1     Definitions.
For the purposes of this Agreement the following definitions shall
apply:

       

      "Additional
Share Percentage" means, (i) if the Record Date ESL Percentage is less than or
equal to the Specified Percentage, a percentage equal to zero (0) or (ii) if the
Record Date ESL Percentage is greater than the Specified Percentage, a
percentage equal to (x) the Record Date ESL Percentage minus (y) the
Specified Percentage.

       

      "Additional
Shares" means a number equal to the product of (i) the Record Date Outstanding
Shares multiplied by (ii)
the Additional Share Percentage.

       

      An
"affiliate" of ESL means any person or entity that directly, or indirectly
through one of more intermediaries, controls, or is controlled by, or is under
common control with, ESL. For the avoidance of doubt, the Company and its
subsidiaries shall not be deemed to be affiliates of ESL.

       

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

       

      "Aggregate
ESL Percentage" means as of any date the sum of (a) the lesser of (x) the
quotient of (i) the Subject Shares divided by (ii) the
Outstanding Shares or (y) 40%, plus (b) the quotient
of (aa) the Subject Shares minus the Initial
Shares divided
by (bb) the Outstanding Shares.

       

      "Outstanding
Shares" means the number of shares of Common Stock outstanding.

       

      "Record
Date ESL Percentage" means the quotient of (i) the Subject Shares divided by (ii) the
Record Date Outstanding Shares.

       

      "Record
Date Outstanding Shares" means the number of shares of Common Stock outstanding
as of the record date for purposes of the stockholder vote (including by written
consent) regarding which the Additional Shares are being
calculated.

       

      "Specified
Percentage" means 40% at all times until the conclusion of the 2009 Annual
Meeting and 37.5% at all times thereafter.

       

      "Subject
Shares" means the number of shares of Common Stock owned by ESL.

       

      "2008
Annual Meeting" means the first annual meeting of stockholders of the Company
held following the conclusion of the Company's fiscal year ending on August 30,
2008, at which the Company's Board of Directors are elected.

       

      "2009
Annual Meeting" means the first annual meeting of stockholders of the Company,
finally adjourned following the conclusion of the Company's fiscal year ending
on August 29, 2009 (i.e., its "2009
fiscal year"), at which the Company's Board of Directors are elected, provided
that the 2008 Annual Meeting shall have already occurred.

       

      "Unaffiliated
Shares" means all Outstanding Shares that are not Subject Shares.

       

       

      ARTICLE
II

       

      VOTING
AGREEMENT

       

      Section
2.1     Voting
Agreement.

       

      (a)         ESL
shall, at each meeting of the stockholders of the Company, whether an annual
meeting or a special meeting, however called, and at each adjournment or
postponement of any such meeting (a "Stockholders' Meeting"), and in all other
circumstances upon which a vote, consent or other approval (including, without
limitation, by written consent) is sought by or from the stockholders of the
Company (any such vote, consent or approval, a "Stockholders' Consent"), appear
at such Stockholders' Meeting or otherwise cause all Subject Shares to be
counted as present for the purpose of establishing a quorum.

       

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      (b)         Subject
to the provisions of Section 7.2(b), ESL shall, at each Stockholders' Meeting
and in connection with the execution of each Stockholders' Consent, vote all
Additional Shares on all matters proposed in the same proportion as Unaffiliated
Shares are actually voted (it being understood that, in connection with any
action by written consent, shares not consenting shall be treated as shares
voted against such action).

       

      Section
2.2     Irrevocable
Proxy.

       

      (a)         Subject
to the provisions of Section 7.2(b), as security for ESL's obligations under
Section 2.1 of this Agreement, ESL hereby irrevocably constitutes and appoints
the Company (acting through the CEO, CFO, General Counsel or such other persons
so designated by the Board of Directors of the Company (the "Board") from time
to time) as its attorney and proxy in accordance with the Nevada Revised
Statutes, with full power of substitution and re-substitution, to cause the
Additional Shares to be counted as present at any Stockholders' Meeting, to vote
the Additional Shares at any Stockholders' Meeting, and to execute any
Stockholders' Consent in respect of the Additional Shares as and to the extent
provided in Section 2.1(b) of this Agreement. The powers granted in this
Section 2.2 shall also entitle the Company to give instructions to any nominee
through whom ESL may hold Shares. ESL shall from time to time provide the
Company with any nominee information that the Company may require to exercise
its rights hereunder. ESL hereby revokes all other proxies and powers of
attorney with respect to the Subject Shares that it may have previously
appointed or granted and represents that any proxies previously given in respect
of the Subject Shares, if any, are revocable.

       

      (b)         Upon
the failure of ESL to comply with its obligations under Section 2.1(a) of this
Agreement, ESL hereby irrevocably constitutes and appoints the Company (acting
through the CEO, CFO, General Counsel or such other persons so designated by the
Board from time to time) as its attorney and proxy in accordance with the Nevada
Revised Statutes, with full power of substitution and re-substitution, to cause
the Subject Shares (excluding the Additional Shares) to be counted as present at
any Stockholders' Meeting as and to the extent provided in Section 2.1(a) of
this Agreement, but such shares (i.e., the Subject Shares
excluding the Additional Shares) may not otherwise be voted by the
Company.

       

      (c)         ESL
hereby affirms that the irrevocable proxy set forth in this Section 2.2 is given
to induce the Company to perform the obligations set forth in Article III of
this Agreement and to secure the performance of the duties of ESL under this
Agreement. ESL hereby further affirms that the irrevocable proxy is coupled with
an interest and, except as set forth in this Section 2.2 or in Section 8.1 of
this Agreement, is intended to be irrevocable in accordance with the provisions
of Section 78.355 of the Nevada Revised Statutes. If for any reason the
proxy granted herein is not irrevocable, then ESL agrees to vote the Additional
Shares in accordance with Section 2.1(b) of this Agreement. The Parties
agree that the foregoing is a voting agreement created under Section 78.365 of
the Nevada Revised Statutes.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      (d)         This
irrevocable proxy shall be effective for each Stockholders' Meeting or
Stockholders' Consent so designated by the Company (unless and to the extent
that ESL has complied with its obligations under Section 2.1 of this Agreement
or the provisions of Section 2.1(b) are suspended, in either case, for such
meeting or action taken by written consent) and shall automatically terminate on
the Termination Date (as defined in Section 8.1 below). Prior to the
Termination Date, this irrevocable proxy shall not be terminated by any act of
ESL or by operation of law, whether by the dissolution or entrance into
bankruptcy or foreclosure of ESL or by the occurrence of any other event or
events, it being understood that actions taken by the Company hereunder prior to
the Termination Date shall be and remain valid as if such dissolution,
entry into bankruptcy or foreclosure or other event or events had not occurred,
regardless of whether or not the Company has received notice of the
same.

       

       

      ARTICLE
III

       

      ADDITION
OF DIRECTORS

      TO THE BOARD OF DIRECTORS OF
THE COMPANY

       

      Section
3.1     New
Directors.
In accordance with the provisions of this Article III, the Company shall take
appropriate actions, once nominees are identified satisfying the requirements of
Section 3.2, to add three (3) new members to the Board (the "New Directors"). It
is the intent of the parties that such additions shall occur as promptly as
practicable, but in no case later than the Company's 2008 Annual Meeting of
Stockholders.

       

      Section
3.2    Selection of New
Directors.

       

      (a)         An
independent search agency has been engaged to identify a nominee for one
(1) of the New Director positions (the "Specified Director") pursuant to
criteria previously determined by the Nominating and Corporate Governance
Committee and all of the directors shall be permitted to propose persons as
suggested candidates for the Specified Director to such independent search
agency. A candidate identified shall be considered by the Nominating
and Corporate Governance Committee in accordance with its regular policies and
procedures, which shall include, without limitation, consideration of such
candidate's background, competencies and experience.  A candidate
shall be recommended by the Nominating and Corporate Governance Committee as a
nominee for election by the Board as the Specified Director only if he or she is
(a) deemed to be "independent" pursuant to the Company's corporate governance
principles and the rules and regulations of the New York Stock Exchange and (b)
reasonably acceptable to both ESL and a majority of the members of the
Nominating and Corporate Governance Committee. Only a nominee who is
recommended by the Nominating and Corporate Governance Committee shall be
presented to the Board as a potential nominee for election as the Specified
Director.

       

      (b)         Two
(2) New Directors (the "Non-Specified Directors") shall be appointed from
nominees identified by ESL, including persons suggested by other directors to
ESL who are reasonably acceptable to ESL (any such person, a
"Candidate"). Each Candidate identified shall be considered by the
Nominating and Corporate Governance Committee in 

       

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      accordance
with its regular policies and procedures, which shall include, without
limitation, consideration of such Candidate's background, competencies,
experience and affiliation with ESL (if any). Only candidates which are
reasonably acceptable to both ESL and a majority of the members of the
Nominating and Corporate Governance Committee may be recommended by the
Nominating and Corporate Governance Committee for election to the Board. Either
or both of the two Candidates may, at ESL's discretion, be an officer of
ESL and its affiliated investment entities. Each candidate shall qualify as
"independent" pursuant to the Company's corporate governance principles and the
rules and regulations of the New York Stock Exchange. The Company will use its
reasonable best efforts to have the Nominating and Corporate Governance
Committee  promptly recommend Candidates for election to the Board once
candidates are identified satisfying the requirements above.

       

       

      (c)         Subject
to the nomination of directors in accordance with the provisions of Section
3.2(a) and 3.2(b), the Company's Board of Directors shall promptly take all
action required to cause the Specified Director and Non-Specified Directors to
be so elected.

       

       

      ARTICLE
IV

       

      REPRESENTATIONS AND
WARRANTIES OF ESL

       

      ESL
hereby represents and warrants to the Company as follows:

       

      Section
4.1    Authority for this
Agreement.
ESL has all necessary power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby. The execution and
delivery of this Agreement by ESL and the consummation by ESL of the
transactions contemplated hereby (i) will not violate the charter, bylaws or any
other organizational documents of ESL, (ii) will not violate any order, writ,
injunction, decree, statute, rule, regulation or law applicable to ESL or by
which any of the Subject Shares are bound, (iii) will not violate or constitute
a breach or default under any agreement by which ESL or the Subject Shares may
be bound, and (iv) have been duly and validly authorized, and no other
proceedings on the part of ESL are necessary to authorize this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by ESL and, assuming it has been duly and
validly authorized, executed and delivered by the Company, constitutes a legal,
valid and binding agreement of ESL, enforceable against ESL in accordance with
its terms. There is no beneficiary or holder of a voting trust certificate or
other interest of any trust of which ESL is a trustee, or any party to any other
agreement or arrangement, whose consent is required for the execution and
delivery of this Agreement or the consummation by ESL of the transactions
contemplated hereby.

       

      Section
4.2    Ownership of
Shares.
As of the date of this Agreement, except as disclosed on Schedule A to this
Agreement, ESL is the sole record and beneficial owner of the number of Initial
Shares set forth on Schedule A to this
Agreement, free and clear of all pledges, liens, proxies, claims, charges,
security interests, preemptive rights, voting trusts, voting agreements,
options, rights of first offer or refusal and any other encumbrances or
arrangements 

       

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

      whatsoever
with respect to the ownership, transfer or other voting of the Initial Shares
other than the encumbrances created by this Agreement and any restrictions on
transfer under applicable federal and state securities laws (collectively,
"Liens"). Except as disclosed on Schedule A to this Agreement, as of the date of
this Agreement, there are no outstanding options, warrants or rights to purchase
or acquire, or agreements or arrangements relating to the voting of, any Subject
Shares and ESL has the sole authority to direct the voting of the Subject Shares
in accordance with the provisions of this Agreement and the sole power of
disposition with respect to the Subject Shares, with no restrictions, subject to
applicable federal and state securities laws on his rights of disposition
pertaining thereto (other than Liens or restrictions created by this Agreement).
Except as disclosed on Schedule A to this
Agreement, as of the date of this Agreement, ESL does not own beneficially or of
record any equity securities of the Company.

       

       

      ARTICLE
V

       

      REPRESENTATIONS AND
WARRANTIES OF THE COMPANY

       

      The
Company hereby represents and warrants to ESL as follows:

       

      Section
5.1    Authority for this
Agreement.
The Company has all necessary corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement by the Company and the consummation
by the Company of the transactions contemplated hereby (i) will not violate any
order, writ, injunction, decree, statute, rule, regulation or law applicable to
the Company, (ii) will not violate or constitute a breach or default under any
agreement by which the Company may be bound, and (iii) have been duly and
validly authorized, and no other proceedings on the part of the Company are
necessary to authorize this Agreement or to consummate the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by the Company and, assuming it has been duly and validly authorized,
executed and delivered by ESL, constitutes a legal, valid and binding obligation
of the Company enforceable against the Company in accordance with its
terms.

       

      ARTICLE
VI

       

      COVENANTS OF
ESL

       

      Section
6.1    No Inconsistent
Agreements.
ESL hereby covenants and agrees that (a) it has not entered into and shall not
enter into any agreement which would restrict, limit or interfere with the
performance of its obligations hereunder and (b) it shall not knowingly take any
action that would reasonably be expected to make any of its representations or
warranties contained herein untrue or incorrect or have the effect of preventing
or disabling it from performing its obligations hereunder.

       

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

       

      Section
6.2    Restrictions on Certain
Transfers and Proxies.

       

      (a)         Other
than pursuant to the terms of this Agreement, without the prior written consent
of the Company or as otherwise provided in this Agreement, ESL shall not
directly or indirectly grant any proxy or enter into any voting trust or other
agreement or arrangement with respect to the voting of any Additional
Shares.

       

      (b)         Without
the prior written consent of the Company, ESL shall not, directly or indirectly,
grant any proxy (other than the proxy granted to the Company pursuant to Section
2.2 of this Agreement and, if applicable, a proxy granted to any other person (a
"Third Party Proxy") which conforms to the requirements of the immediately
succeeding sentence of this Section 6.2(b)) or enter into any voting trust or
other agreement or arrangement with respect to the voting of any Subject Shares
(excluding the Additional Shares). Notwithstanding the immediately
preceding sentence, ESL may grant a Third Party Proxy with respect to the voting
of any Subject Shares (excluding the Additional Shares) so long as such Third
Party Proxy shall in all cases be (i) immediately and fully revocable by ESL at
any time without prior notice to the holder of such proxy and (ii) subordinate
and subject to the rights of the Company under this Agreement.

       

       

      Section
6.3    Future Sales and/or
Transactions
Involving an Acquisition of the Company.

       

      (a)           ESL
shall not dispose or agree to dispose of any shares of Common Stock pursuant to
any agreement, arrangement or understanding (whether or not in writing),
including by way of merger or other business combination, at a price above the
market price per share prevailing at the time of such agreement, arrangement or
understanding, without taking appropriate steps to ensure that the purchaser of
such shares simultaneously provides all other holders of Common Stock with an
opportunity to dispose of a number of shares (representing, for each Company
stockholder, the same proportion of owned shares of Common Stock as ESL proposes
to dispose of) in such transaction on the same terms and conditions, including
price per share, as ESL. It is understood that (i) sales in the open market
shall be deemed to be at prevailing market prices and (ii) (a) the transfer of
Shares of Common Stock from one ESL affiliate subject to this Agreement to
another, (b) distributions by ESL to its shareholders or limited partners, and
(c) sales to the Company or third parties approved by at least two directors
representing a majority of the independent, disinterested directors unaffiliated
with ESL, shall not constitute a disposition subject to this Section
6.3(a).

       

      (b)           ESL
shall not pursue, either directly or indirectly, including as part of a group, a
transaction resulting in the acquisition of all or substantially all of the
shares of Common Stock not owned by ESL or by such group (including, for
example, in a leveraged recap in which "stub equity" is left in the hands of
some or all of the non-ESL stockholders) unless the following procedures and
requirements are followed and satisfied. The Board shall establish a
committee of independent, disinterested directors unaffiliated with ESL (the
"Special Committee") to review and evaluate any transaction (other than any such
transaction in which ESL would be treated on the same basis as all other Company
stockholders) proposed by ESL or in which ESL intends to participate, with full
authority to negotiate and recommend the terms of 

       

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

       

      such
a transaction on behalf of the Company and the non-ESL stockholders. ESL
will proceed only with a transaction recommended by the Special Committee,
unless the acquisition is structured as a "non-coercive" tender
offer, followed by a merger at the same price if the offer is
successful, not subject to the test of "entire fairness" in accordance with
applicable Delaware case law (e.g., the decisions
involving Silconix and Pure Resources), assuming, for these purposes, that the
Company had been incorporated under the laws of the State of Delaware and was
subject to Delaware law.

       

       

      (c)           The
provisions of this Section 6.3 may be enforced by any directors
constituting a majority of the independent, disinterested directors unaffiliated
with ESL or, in the absence of any such persons sitting on the Board, through a
derivative action.

       

      Section
6.4    Information Regarding Common
Stock.
If ESL increases or decreases the number of Subject Shares it owns at any time
prior to the Termination Date, ESL shall give prompt notice to the Company of
such increase or decrease (which notice may be satisfied by a filing of a Form 4
with the Securities and Exchange Commission on a timely basis). If requested by
ESL, the Company shall promptly provide ESL with the number of Outstanding
Shares.

       

       

      ARTICLE
VII

       

      COVENANTS OF THE
COMPANY

       

      Section
7.1    Restrictions on Certain
Company Actions.
Other than pursuant to the terms of this Agreement, without the prior written
consent of ESL, the Company shall not take any action, including the adoption of
a stockholder rights plan, that would prevent ESL from exercising voting rights
or acquiring additional shares of Common Stock, except to the extent that such
action is required by applicable law (including the implementation of blackout
periods that apply equally to the Company and all affiliates of the
Company).

       

       

      Section
7.2    Target Adjusted Debt/EBITDAR Ratio.

       

      (a)           The
Company shall use its commercially reasonable efforts to achieve, no later than
February 14, 2009, the last day of the Company's second quarter of the
Company's 2009 fiscal year, an adjusted debt/EBITDAR ratio of at least
2.5:1.  For purposes of this section 7.2, adjusted debt/EBITDAR ratio
shall be calculated in a manner consistent with the calculation of such ratio in
the Company's quarterly earnings release.

       

      (b)           If
the Company shall not have achieved the targeted adjusted debt/EBITDAR ratio
referenced in Section 7.2(a) by the end of the second quarter of the Company's
2009 fiscal year, the provisions of Section 2.1(b) shall be suspended until such
time as the targeted adjusted debt/EBITDAR ratio is achieved.

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

       

      ARTICLE
VIII

       

      MISCELLANEOUS

       

      Section
8.1    Termination.
This Agreement and all of its provisions shall terminate upon the Termination
Date; provided that
Sections 8.3, 8.4, 8.5, 8.7, 8.8, 8.9, 8.10, 8.13 and, in the case of clause (b)
below, 6.3 of this Agreement shall survive any termination of this Agreement.
For purposes of this Agreement, "Termination Date" means the earliest of (a) the
date upon which the Subject Shares shall, in the aggregate, constitute less than
25% of the Outstanding Shares, (b) the date upon which the Aggregate ESL
Percentage shall exceed 50% and (c) the date upon which the Parties (which, in
the case of the Company, shall have been authorized by at least two directors
representing a majority of the independent and disinterested members of the
Board unaffiliated with ESL) mutually agree in writing that this Agreement and
all of its provisions shall no longer be in effect. Nothing in this Section 8.1
shall be deemed to release any Party from any liability for any breach by such
Party of their representations and warranties or any other terms and provisions
of this Agreement.

       

      Section
8.2    No Ownership
Interest.
Except as expressly set forth in this Agreement, including, without limitation,
in Section 2.2 of this Agreement, nothing contained in this Agreement shall be
deemed to vest in the Company any direct or indirect ownership, or incidence of
ownership, of or with respect to any Subject Shares. All rights, ownership and
economic benefits of and relating to any Subject Shares shall remain and belong
to ESL, and the Company shall not have any authority to exercise any power or
authority to manage, direct, superintend, restrict, regulate, govern or
administer any of the policies or operations of ESL or exercise any power or
authority to direct ESL in the voting of any of the Subject Shares, except as
otherwise expressly provided in this Agreement, including, without limitation,
in Section 2.2 of this Agreement.

       

      Section
8.3    Notices.
All notices, requests, claims, demands and other communications hereunder shall
be given (and shall be deemed to have been duly received if given) by hand
delivery in writing or by facsimile transmission with confirmation of receipt or
by a nationally recognized overnight courier service, as follows:

       

      If
to the Company:

      


      AutoZone,
Inc.

      123
South Front Street

      Memphis,
TN 38103-3607

      Attn:
Harry L. Goldsmith

      Fax:
901-495-8316

      


      With
a copy to:

      


      Skadden,
Arps, Slate, Meagher & Flom LLP

      4
Times Square

      New
York, New York 10036

      Attn:
Peter Allan Atkins

      David
J. Friedman

      Fax:
212-735-2000

      


      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      If
to ESL:

      


      ESL
Investments, Inc.

      200
Greenwich Avenue

      Greenwich,
CT 06830

      Attn:
Chief Financial Officer

      Fax:
203-621-3244

      


      Wth
a copy to:

      


      Wachtell,
Lipton, Rosen & Katz

      51
West 52nd Street

      New
York, NY 10019

      Attn:
David A. Katz

      Fax:
212-403-2000

      


      Section
8.4    Validity.
Whenever possible, each provision or portion of any provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any respect under
any applicable law or rule in any jurisdiction such invalidity, illegality or
unenforceability shall not affect any other provision or portion of any
provision in such jurisdiction, and this Agreement shall be reformed, construed
and enforced in such jurisdiction as if such invalid, illegal or unenforceable
provision or portion of any provision had never been contained
herein.

       

      Section
8.5    Entire Agreement;
Assignment.
This Agreement constitutes the entire agreement between the Parties with respect
to the subject matter of this Agreement and supersedes all other prior
agreements and understandings, both written and oral, between the Parties with
respect to the subject matter of this Agreement. The Agreement shall not be
assigned by any Party by operation of law or otherwise without the prior written
consent of the other Party.

       

      Section
8.6    Adjustments.
If at any time during the period between the date of this Agreement and the
Termination Date, any change in the outstanding shares of capital stock of the
Company shall occur by reason of any reclassification, recapitalization, stock
split or combination, exchange or readjustment of shares, or any stock dividend
on such capital stock with a record date during such period, the number of
shares of Common Stock shall be appropriately adjusted to provide ESL and the
Company with same results contemplated by this Agreement as of the date it was
executed.

       

      Section
8.7    Amendment.
This Agreement may not be amended except by an instrument in writing signed by
the Company (which, in the case of the Company, shall have been authorized by at
least two directors representing a majority of the independent and disinterested
members of the Board unaffiliated with ESL).

       

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

       

      Section
8.8    Parties in
Interest.
This Agreement shall be binding upon and inure solely to the benefit the
Parties, and nothing in this Agreement, express or implied, is intended to
confer upon any other person or entity any rights or remedies of any nature
whatsoever under or by reason of this Agreement.

       

      Section
8.9    Governing
Law.
This Agreement shall be governed by and construed in accordance with the laws of
the State of Nevada (without giving effect to choice of law
principles).

       

      Section
8.10  Enforcement of the
Agreement;
Jurisdiction; Venue.
The Parties agree that irreparable damage would occur in the event that any of
the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached and that money damages would be both
incalculable and an insufficient remedy for any such non-performance or other
breach. It is accordingly agreed that each Party shall be entitled to seek an
injunction or injunctions to prevent breaches of this Agreement and to enforce
specifically the terms and provisions of this Agreement in the courts of the
State of Nevada, this being in addition to any other remedy to which it is
entitled at law or in equity. Each Party agrees that it will not allege or
assert that money damages are an adequate or sufficient remedy for a breach of
this Agreement as a defense or objection to the request or granting of
injunctive and / or other equitable relief therefor. The Parties further agree
that neither Party shall be required to obtain, furnish or post any bond or
similar instrument or other security in connection with or as a condition to
obtaining any remedy referred to in this Section 8.10, and each Party
irrevocably waives any right it may have to require the obtaining, furnishing or
posting of any such bond or similar instrument or other security. In addition,
each Party (a) consents to submit itself to the personal jurisdiction of any
such court in the event any dispute arises out of this Agreement or any
transaction contemplated by this Agreement, (b) agrees that it will not attempt
to deny or defeat such personal jurisdiction by motion or other request for
leave from any such court, (c) agrees that it will not bring any action relating
to this Agreement or any transaction contemplated by this Agreement in any court
other than a court in the State of Nevada and (d) waives any right to trial by
jury with respect to any action related to or arising out of this Agreement or
any transaction contemplated by this Agreement. Each Party irrevocably and
unconditionally waives any objection to the laying of venue of any action, suit
or proceeding arising out of this Agreement or the transactions contemplated
hereby in the courts of the State of Nevada and shall irrevocably and
unconditionally waive and agree not to plead or claim in any such court that any
such action, suit or proceeding brought in any such court has been brought in an
inconvenient forum.

       

      Section
8.11  Descriptive
Headings.
The descriptive headings herein are inserted for convenience of reference only
and are not intended to be part of or to affect the meaning or interpretation of
this Agreement.

       

      Section
8.12  Counterparts.
This Agreement may be executed in counterparts, each of which shall be deemed to
be an original, but all of which, taken together, shall constitute one and the
same agreement.

       

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

       

      Section
8.13  Further
Assurances.
From time to time, at the request of the other Party and without further
consideration, each Party agrees to take such reasonable further action as may
reasonably be necessary or desirable to consummate and make effective the
transactions contemplated by this Agreement.

       

       

      [signature
page follows]

       

       

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

       

      IN
WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed on
the date first written above.

       

      


      
        	 
      	
                AUTOZONE,
      INC.

              
	 	 
	 
      	
                By:

              	 /s/
      William C. Rhodes, III	 
      
	 
      	 
      	
                Name:
      William C. Rhodes, III

              
	 
      	 
      	
                Title: Chairman,
      President and
      CEO

              
	 	 	 
	 
      	
                By:

              	 /s/
      Harry L. Goldsmith	 
      
	 
      	 
      	
                Name:
      Harry L. Goldsmith

              
	 
      	 
      	
                Title:
      EVP, General Counsel and Secretary

              
	 
      	 
      
	 	 
	 
      	
                ESL
      INVESTMENTS, INC. (on behalf of itself and its
  affiliates)

              
	 	 
	 
      	
                By:

              	 /s/
      Adrian John Maizey	 
      
	 
      	 
      	
                Name:
      Adrian John Maizey

              
	 
      	 
      	
                Title:
      Chief Financial Officer

              


      

      


      


      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      SCHEDULE
A

       

       

      SHARES OF COMMON STOCK OWNED
BY ESL

       

      


       

      Shares
of Common Stock Held by ESL as of June 24, 2008: 22,928,783

       

       

      Options
to Purchase Shares of Common Stock Held of Record by ESL as of June 24, 2008:
0

       

       

      Total
Shares of Common Stock Owned by ESL as of June 24, 2008: 22,928,783

       

       

      Shares
of Common Stock Held by ESL and Pledged as of June 24, 2008: 0

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       A-1