Advance Auto Parts Enters Amendment to Credit Agreement

Advance Auto Parts, Inc. recently announced that on November 13, 2024, it entered into Amendment No. 5 to its Credit Agreement dated November 9, 2021. This amendment was made among Advance Auto Parts, Inc. as the borrower, Advance Stores Company, Incorporated as a guarantor, the lenders involved, and Bank of America, N.A. as the administrative agent.

The key changes under Amendment No. 5 to the 2021 Credit Agreement include allowing up to $575 million of certain restructuring charges to be incorporated back into Consolidated EBITDAR, permitting up to $800 million of unrestricted cash to be subtracted from debt in calculating the Leverage Ratio, and reducing the minimum Consolidated Coverage Ratio. The unsecured revolving credit facility under the agreement was reduced from $1.2 billion to $1.0 billion, and pricing on the loans was adjusted based on the company’s credit ratings.

The interest rates for outstanding amounts on the revolving facility will now be determined at the company’s discretion, based on Term SOFR or an alternate base rate, each with varying margins. Additionally, certain covenants and limitations on Advance Auto Parts and its subsidiaries have been updated, expanding the covenant on creating additional debt, restricting share repurchases and cash dividends, and requiring the company to grant liens under certain conditions.

For further details, the full text of the amendment has been attached as Exhibit 10.1 to the current Form 8-K filing. The company is taking proactive steps to manage its financial structure and obligations in light of changing market conditions.

The company’s stock symbol AAP is listed on the New York Stock Exchange. Investors and stakeholders are advised to review the complete filing on the SEC’s website for a comprehensive understanding of the recent developments.

This news comes as part of Advance Auto Parts’ ongoing efforts to streamline its financial arrangements and adapt to evolving business requirements.

The article is a condensed version of the complete 8-K SEC Filing available for public viewing.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read Advance Auto Parts’s 8K filing here.

About Advance Auto Parts

Advance Auto Parts, Inc provides automotive replacement parts, accessories, batteries, and maintenance items for domestic and imported cars, vans, sport utility vehicles, and light and heavy duty trucks. The company offers battery accessories; belts and hoses; brakes and brake pads; chassis and climate control parts; clutches and drive shafts; engines and engine parts; exhaust systems and parts; hub assemblies; ignition components and wires; radiators and cooling parts; starters and alternators; and steering and alignment parts.