Case Doc 6 Filed 10/04/18 Page 1 of 17

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1 Case Doc 6 Filed 10/04/18 Page 1 of 17 IN THE UNITED STATES BANKRUPTCY COURT I+'O~t THE DISTRICT OF DELAWARE --- In re: ) Chapter 11 ATD CORPORATION, et al.,l ) Case No O Debtors. ) (Joint Administration Requested) DEBTORS' MOTION FOR ENTRY OF INTERIM ANll FINAL ORDERS (I) AU~'I~O1tI~ING THE PAYMENT OF CERTAIN PREPETITION AND POSTPETITION TAXES AND FEES ANll (II) GRANTING RELATED RELIEF The above-captioned debtors and debtors in possession (collectively, the "Debtors") respectfully state as follows in support of this motion (this"motion"):2 Relief Requested 1. The Debtors seek entry of interim and final orders, substantially in the forms attached hereto as Exhibit A and Exhibit 13 (the "Interim Order" and the "Final Ordex," respectively): (a) authorizing, but not directing, the Debtors, to remit and pay certain taxes and fees that accrued prior to the Petition Date; and (b) granting related relief. In addition, the Debtors request that the Court schedule a final hearing approximately 21 days from the Petition Date (as defined below). ' The Debtors in these chapter 11 cases, along with the last four digits of each Debtor's federal tax identification number, where applicable, include: ATD Corporation (3683); Accelerate Holdings Coip. (0528); American Tire Distributors Holdings, Inc. (6143); American Tire Distributors, Inc. (4594); Rubbr Automotive Services, LLC (3334); The Hercules Tire &Rubber Company (3365); Terry's Tire Town Holdings, Inc. (7464); Tire Pros Francorp (1361); and Hercules Asia Pacific, LLC (2499). The location of the Debtors' service address in these chapter 11 cases is Herbert Wayne Court, Suite 150, Huntersville, North Carolina The facts and circumstances supporting this Motion are set forth in the Declaration of William Williams, Chief Financial Officer of ATD Corporation, in Support of Chapter 11 PeCztions and First Day Motions (the "First Dav Declaration"), filed contemporaneously with. this Motion and incorporated by reference herein. KE

2 Case Doc 6 Filed 10/04/18 Page 2 of 17 Jurisdiction and Venue 2. The United States Bankruptcy Court for the District of Delaware (the "Court") has jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334 and the Amended Standing Oder of Reference from the United States District Court for the District of Delaware, dated February 29, The Debtors confirm their consent, pursuant to Rule 7008 of the Federal Rules of Bankruptcy Procedure (the `Bankruptcy Rules"), to the entry of a final order by the Court in connection with this Motion to the extent that it is later determined that the Court, absent consent of the parties, cannot enter final orders or judgments in connection herewith consistent with Article III of the United States Constitution. 3. Venue is proper pursuant to 28 U.S.C and The bases for the relief requested herein are sections 105(a), 363(b), 507(a)(8), and 541 of title 11 of the United States Code, 11 U.S.C (the"bankruptc,~ode"), Bankruptcy Rules 6003 and 6004, and Local Rule (m) of the Local Rules of the United States Bankruptcy Court for the District of Delaware (the "Local Rules") Sack round 5. The Debtors are the largest distributor of replacement tires in North America based on dollar amount of wholesale sales. With their network of over 140 distribution centers and 1,400 delivery vehicles, the Debtors service a geographic region covering more than 90 percent of the replacement tire market for passenger vehicles and light trucks in the United States. In addition, the Debtors' proprietary Hercules0 brand is the number one private tire brand in North America based on unit sales. The Debtors are headquartered in Huntersville, North Carolina. Non-Debtor affiliate National Tire Distributors Inc. and its subsidiaries operate on of the largest replacement tire distributors in Canada, with 23 distribution centers throughout the country. The Debtors and their non-debtor subsidiaries generated approximately $5.2 billion 2

3 Case Doc 6 Filed 10/04/18 Page 3 of 17 in revenue in fiscal year 2017 and currently employ approximately 5,500 people in the United States and Canada. As of the date hereof (the "Petition Date"), the Debtors have approximately $2.6 billion in funded debt. 6. On the Petition Date, each Debtor filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code. The Debtors are operating their business and managing their properties as debtors in possession pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. Concurrently with the filing of this Motion, the Debtors filed a motion requesting procedural consolidation and joint administration of these chapter 11 cases pursuant to Bankruptcy Rule 1015(b). No request for the appointment of a trustee or examiner has been made in these chapter 11 cases, and no committees have been appointed or designated. The Taxes and Fees 7. The Debtors collect, withhold, and incur sales, use, withholding, income, franchise, and property taxes, as well as other business and regulatory fees (collectively, the "Taxes and Fees").3 The Debtors remit the Taxes and Fees to various federal, state, and local governments, including taxing and licensing authorities, identified in a schedule attached hereto as Exhibit C (collectively, the "Authorities")4. Taxes and Fees are remitted and paid by the Debtors through checks and electronic funds transfers that are processed through their banks and other financial institutions. The Debtors estimate that approximately $9.3 million in Taxes and 3 By this Motion, the Debtors do not seek the authority to collect and remit state and federal employee-related taxes and withholdings. Such relief is instead requested in the Debtors' Motion for Entry of Interim and Final Orders (1) Authorizing the Debtors to (A) Pay P~epetition Wages, Salaries, Compensation, and Reimbursable expenses and (B) Continue Employee Benefits Programs, and (II) Granting Related Relief, filed contemporaneously herewith. 4 Although Exhibit C is intended to be comprehensive, the Debtors may have inadvertently omitted Authorities from Exhibit C. By this Motion, the Debtors request relief with respect to Taxes and Fees payable to all Authorities, regardless of whether such Authority is specifically identified on Exhibit C. In the event the Debtors pay any Authority not included on Exhibit C, the Debtors will file a notice with the Court listing such Authority within 15 days of such payment. 3

4 Case Doc 6 Filed 10/04/18 Page 4 of 17 Fees are outstanding as of the Petition Date, of which $5,500,000 is currently payable or will become due and owing to the Authorities after the Petition Date in the ordinary courses 8. The Debtors pay the Taxes and Fees to the Authorities on a periodic basis, remitting them monthly, quarterly, semi-annually, or annually depending on the nature and incurrence of a particular Tax or Fee. Although the Debtors believe that they are substantially current with respect to their payment of Taxes and Fees, the Debtors seek authority pursuant to this Motion to make such payments where: (a) Taxes and Fees accrue or are incurred postpetition; (b) Taxes and Fees accrued or were incurred prepetition but were not paid prepetition or were paid in an amount less than actually owed; (c) Taxes and Fees paid prepetition by the Debtors were lost or otherwise not received in full by any of the Authorities; or (d) Taxes and Fees incurred for prepetition periods may become due after the commencement of these chapter 11 cases. 9. In addition, the Debtors collect and hold certain outstanding tax liabilities in trust for the benefit of the applicable Authorities, and these funds may not constitute property of the Debtors' estates. 10. The Taxes and Fees are summarized as follows: 5 The Debtors are currently subject to ongoing audit investigations and may be subject to further investigations on account of tax returns and/or obligations in prior years (collectively, the "Audits"). This figure includes investigations by the Authorities with respect to above categories, which may result in the imposition of additional prepetition Taxes and Fees being assessed against the Debtors, including interest on late payment of taxes (such additional Taxes and Fees, the "Assessments"). This figure also includes Assessments that may already have been made but are being contested in appropriate judicial or administrative proceedings, as well as amounts that may. need to be posted as collateral in_ order. to contest asserted.assessment. amounts. Nothing in the above table, this Motion, or any related order constitutes or should be construed as an admission of liability by the Debtors with respect to any Audit or Assessment. The Debtors expressly reserve all rights with respect to any Audit. Furthermore, the Debtors reserve the right to contest any Assessment, if any, claimed to be due as a result of the Audits C!

5 Case Doc 6 Filed 10/04/18 Page 5 of 17 ~~ Sales and Use Taxes imposed on the sale and use of certain $550,000 $550,000 Taxes goods and services. Income and Taxes imposed on the Debtors' income and $1,530,000 N/A Franchise Taxes taxes imposed upon the Debtors to operate their businesses pursuant to state laws. Property Taxes Taxes and obligations related to real and $3,250,000 $950,000 personal property holdings. Customs and Taxes imposed nn the Debtors for importing $3,500,000 $3,500,000 Import Duties goods into a particular jurisdiction from outside that jurisdiction. Regulatory, Fees related to permitting, licensing, regulatory $460,000 $460,000 Environmental, and assessments, tire fees, compliance with Taxes and environmental laws and regulations, and other Fees. fees paid to the Authorities. Total $9,290,000 $5,460,000 I. Sales and Use Taffies. 11. The Debtors incur, collect, and remit, sales and use taxes, including Canadian goods and services taxes and harmonized sales taxes, to the Authorities in connection with the sale and purchase of goods and services (collectively, the "Sales and Use Taxes"). Additionally, the Debtors purchase a variety of equipment, materials, supplies, and services necessary for the operation of their business from vendors who may not operate or be registered to collect tax in the state where the goods are to be delivered or the services_ are to be performed and, therefore, these vendors do not charge the Debtors sales tax in connection with such purchases of goods or services. In these cases, applicable law generally requires the Debtors to subsequently pay use taxes on such purchases to the applicable Authorities. The Debtors generally remit Sales and Use Taxes on a monthly basis. 5

6 Case Doc 6 Filed 10/04/18 Page 6 of In the 12 months prior to the Petition Date, the Debtors paid approximately $6.4 million in the aggregate in Sales and tjse Taxes to the Authorities. As of the Petition Date, the Debtors estimate that they have incurred or collected approximately $550,000 in sales and use taxes that have not been remitted to the relevant Authorities, all of which are currently payable or will become payable during the interim period. II. Income and Franchise Taxes. 13. Historically, in the ordinary course of operating their businesses, the Debtors have incurred state and federal income taxes, including some amounts on account of foreign income taxes (collectively, the "Income Taxes"). The Debtors generally pay income taxes on a quarterly basis. In addition, the Debtors are required to pay various state franchise taxes independent of income taxes in certain jurisdictions in order to continue conducting their businesses pursuant to state laws (collectively, the "Franchise Taxes" and, together with the Income Taxes, the "Income and Franchise Taxes"). The Debtors typically pay the Franchise Taxes on an annual basis. In the 12 months prior to the Petition Date, the Debtors paid approximately $1.7 million in Income and Franchise Taxes to the applicable Authorities. As of the Petition Date, the Debtors estimate that they owe approximately $1.5 million to the relevant Authorities on account of prepetition Income and Franchise Taxes, none of which are currently payable or will become payable during the interim period. ~ The Debtors reserve the right to make deferred payments on account of the Income and Franchise Taxes at the end of these chapter 11 cases pursuant to 11 U.S.C. 1129(a)(9)(C). In certain jurisdictions, franchise taxes are included on the Debtors' state income tax return. For the avoidance of doubt, the Debtors are seeking authority to continue remitting franchise taxes which are included on income tax returns in the ordinary course of business and consistent with past practices. G

7 Case Doc 6 Filed 10/04/18 Page 7 of 17 III. Property Taxes. 14. State and local laws in the jurisdictions where the Debtors operate generally grant Authorities the power to levy property taxes against the Debtors' real and personal property (collectively, the "Property Taxes"). In some instances, the Debtors lease property and pay property taxes to the landlords who then remit the property taxes to the applicable Authority. To avoid the imposition of statutory liens on their real and personal property, the Debtors typically pay property taxes in the ordinary course of business on an annual or semi-annual basis, depending on the Authority. In the 12 months prior to the Petition Date, the Debtors paid approximately $7.3 million in Property Taxes to the applicable Authorities. The Debtors estimate that they have accrued approximately $3.3 million in property taxes as of the Petition Date, of which approximately $950,000 are currently payable or will become payable during the interim period. IV. Import and Customs Duties. 15. The Debtors are required to pay both import duties and customs duties in the ordinary course of operating their business (collectively, the "Import and Customs Duties") Specifically, the Debtors incur Import and Customs Duties through the import of a significant amount of tires from China and other international markets. The Debtors pay Import and Customs Duties on a monthly, quarterly, or annual basis. In the 12 months prior to the Petition Date, the Debtors paid approximately $18.7 million in Import and Customs Duties. As of the Petition Date, the Debtors estimate that approximately $3.5 million in Import and Customs Duties will have accrued and remained unpaid to the relevant Authorities, all of which are currently payable or will become due and owing during the interim period.. 7

8 Case Doc 6 Filed 10/04/18 Page 8 of 17 V. Regulatory, En~~ironniental, and Taxes and Fees. 16. The Debtors incur, in the ordinary course of business, a variety of fees related to governmental laws and regulations, including state environmental taxes imposed on tire dealers (the "Re u~ latory Environmental, and Taxes and Fees"). The Debtors typically remit Regulatory, Environmental, and Taxes and Fees to the relevant Authorities on a monthly, quarterly, or annual basis depending on the type of tax or fee. In the 12 months prior to the Petition Date, the Debtors paid approximately $3.7 million in Regulatory, Environmental, and Taxes and Fees. As of the Petition Date, the Debtors estimate that approximately $460,000 in Regulatory, Environmental, and Taxes and Fees will have accrued and remain unpaid to the relevant Authorities or customs agents, all of which will become due and owing during the Interim Period. Basis for Relief 17. The Debtors believe that any failure to pay the Taxes and Fees could materially disrupt the Debtors' business operations in several ways: (a) the Authorities may initiate audits of the Debtors, which would unnecessarily divert the Debtors' attention from the restructuring process; (b) the Authorities may attempt to suspend the Debtors' operations, file liens, seek to lift the automatic stay, and pursue other remedies that will harm the estates; and (c) certain of the Debtors' directors and officers could be subject to claims of personal liability, which would likely distract those key employees from their duties related to the Debtors' restructuring. In addition, the Debtors collect and hold certain outstanding tax liabilities in trust for the benefit of the applicable Authorities, and these funds may not constitute property of the Debtors' estates. Moreover, unpaid Taxes and Fees may result in penalties, the accrual of interest, or both. E

9 Case Doc 6 Filed 10/04/18 Page 9 of 17 I. Certain of the Taxes and Fees 1VIay Not Be Property of the Debtors' Estates. 18. Many of the Taxes and Fees are collected or withheld by the Debtors on behalf of the applicable Authorities and are held in trust by the Debtors. As such, these Taxes and Fees are not property of the Debtors' estates under section 541 of the Bankruptcy Code. See, e.g., 13egier v. Internal Revenue SeNv., 496 U.S. 53, (1990) (holding that any prepetition payment of trust fund taxes is not a transfer subject to avoidance because such funds are not the debtor's property); In re FiNst Pay, Inc., 773 T.3d 583, 590 (4th Cir. 2014) (same); DuC'haNmes & Co. v. Mich. (In re DuChaNmes & Co.), 852 F.2d 194 (6th Cir. 1988) (per curiam) (same); In Ne Shank, 792 F.2d 829, 833 (9th Cir. 1986) (sales tax required by state law to be collected by sellers from their customers is a "trust fund" tax and not released by bankruptcy discharge); DeChiallo v. N.Y. State Tax Comm'n, 760 F.2d 432, (2d Cir. 1985) (same); Rosenow v. Ill. Dept. of Revenue (In Ne Rosenow), 715 F.2d 277, (7th Cir. 1983) (same); W. Surety Co. v. Waite (In Ne Waite), 698 F.2d 1177, 1179 (1 lth Cir. 1983) (same). The Debtors, therefore, generally do not have an equitable interest in such funds, and they should be permitted to pay those funds to the Authorities as they become due.8 II. Certain of the Taxes and Fees May Be Secured or Priorit~~ Claims Entitled to Special Treatment under the Bankruptcy Code. 19. Claims for certain of the Taxes and Fees are or may be priority claims entitled to payment before general unsecured claims. See 11 U.S.C. 507(a)(8) (describing taxes entitled to priority treatment). Moreover, to the extent that such amounts are entitled to priority treatment under the Bankruptcy Code, the respective Authorities may attempt to assess interest and penalties if such amounts are not paid. See 11 U.S.C. 507(a)(8)(G) (granting eighth 8 For the avoidance of doubt, the Debtors hereby request authority to pay the Taxes and Fees as provided herein regardless of whether such Taxes and Fees constitute trust fund obligations.

10 Case Doc 6 Filed 10/04/18 Page 10 of 17 priority status to "a penalty related to a claim of a kind specified in this paragraph and in compensation for actual pecuniary loss"). Claims entitled to priority status pursuant to section 507(a)(8) of the Bankruptcy Code must be paid in full under a confirmable plan pursuant to section 1129(a)(9)(C) of the Bankruptcy Code. Therefore, payment of certain of the Taxes and Fees at this time only affects the timing of the payment for the amounts at issue and will not unduly prejudice the rights and recoveries of junior creditors. III. Payment of the Taxes and Fees as Provided Herein Is a Sound Exercise of the ~?ebtors' business Jt~dganento 20. Section 363 of the Bankruptcy Code provides, in relevant part, that "[t]he [debtor], after notice and a hearing, may use, sell, or lease, other than in the ordinary course of business, property of the estate." 11 U.S.C. 363(b)(1). Under this section, a court may authorize a debtor to pay certain prepetition claims. See In Ne Lehigh &New England Ry. Co., 657 F.2d 570, 581 (3d Cir. 1981) (recognizing the doctrine of necessity and authorizing the debtor to pay prepetition claims if such payment was essential to the continued operation of the debtor); In re ONzon Refining Corp., 372 B.R. 688, 703 (Bankr. D. Del. 2007) (authorizing payment of prepetition claim of critical vendor pursuant to section 363(b) of the Bankruptcy Code). To do so under section 363(b) of the Bankruptcy Code, courts require only that the debtor "show that a sound business purpose" justifies the proposed use of property. In re Montgomery Ward Holding CoNp., 242 B.R. 147, 153 (D. Del. 1999); see also In re Phx. Steel Copp., 82 B.R. 334, (Bankr. D. Del. 1987); see also Comm. of Equity Sec. Holders v. Lionel Corp. (In Ne Lionel Corp.), 722 F.2d 1063, (2d Cir. 1983) (requiring a "good business reason" to approve a sale pursuant to section 363(b)). Moreover, "[w]here the debtor articulates a reasonable basis for its business decisions (as distinct from a decision made arbitrarily or capriciously), courts will generally not entertain objections to the debtor's conduct." In re 10

11 Case Doc 6 Filed 10/04/18 Page 11 of 17 Johns-Manville CoNp., 60 B.R. 612, 616 (Barilcr. S.D.N.Y. 1986); see also In re ToweN AiN, Inc., 416 F.3d 229, 238 (3d Cir. 2005) ("Overcoming the presumptions of the business judgment rule on the merits is anear-herculean task."). Thus, if a transaction satisfies the business judgment rule, it should be approved under section 363(b) of the Bankruptcy Code. 21. Furthermore, section 105(a) of the Bankruptcy Code further provides that a court "may issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of the Bankruptcy Code, pursuant to the "doctrine of necessity." 11 U.S.C. 105(a). The "doctrine of necessity" functions in a chapter 11 case as a mechanism by which the bankruptcy court can exercise its equitable power to allow payment of critical prepetition claims not explicitly authorized by the Bankruptcy Code and further supports the relief requested herein. See In re Lehigh &New Eng. Ry., 657 F.2d 570, 581 (3d Cir. 1981) (holding that a court may authorize payment of prepetition claims if such payment is essential to debtor's continued operation); see also In Ne Just for Feet, Inc., 242 B.R. 821, (D. Del. 1999) (holding that section 105(a) of the Bankruptcy Code "provides a statutory basis for payment of pre-petition claims" under the doctrine of necessity); In ~e Columbia Gas Sys., Inc., 171 B.R. 189, (Bankr. D. Del. 1994) (explaining that the doctrine of necessity is the standard in the Third Circuit for enabling a court to authorize the payment of prepetition claims prior to confirmation of a reorganization plan). 22. Moreover, the doctrine of necessity is designed to foster a debtor's rehabilitation, which courts have recognized is "the paramount policy and goal of Chapter 11." IonospheNe Clubs, 98 B.R., 174, 176 (Bankr. S.D.N.Y. 1989); see also In ~e Quality Interiors, Inc., 127 B.R. 391, 396 (Bankr. N.D. Ohio 1991) ("[P]ayment by adebtor-in-possession of pre-petition claims outside of a confirmed plan of reorganization is generally prohibited by the Bankruptcy Code," 11

12 Case Doc 6 Filed 10/04/18 Page 12 of 17 but "[a] general practice has developed...where bankruptcy courts permit the payment of certain pre-petition claims, pursuant to 11 U.S.C. 105, where the debtor will be unable to reorganize without such payment."); In Ne Eagle-Piche~ Indus., Inc., 124 B.R. 1021, 1023 (Bankr. S.D. Ohio 1991) (approving payment of prepetition unsecured claims of toolmakers as "necessary to avert a serious threat to the Chapter 11 process"); Mich. Bureau of WoNkeNs' Disabzlity Comp. v. Chateaugay Co~^p. (In re Chateaugay Corp.), 80 B.R. 279, (S.D.N.Y. 1987) (approving lower court order authorizing payment of prepetition wages, salaries, expenses, and benefits). 23. The Debtors' ability to pay the Taxes and Fees is critical to their continued and uninterrupted operations. If certain Taxes and Fees- remain unpaid, the Authorities may seek to recover such amounts directly from the Debtors' directors, officers, or employees, thereby distracting these key personnel from the administration of the Debtors' chapter 11 cases. See e.g., In re Am. MotoN Club, Inc., 139 B.R. 578, (Bankr. E.D.N.Y. 1992) (stating "[i]f the employer fails to pay over the trust fund taxes, the IRS may collect an equivalent amount directly from officers or employees of the employer who are responsible for collecting the tax" and finding director personally liable for unpaid taxes) (citing United States v. EneNgy Res. Co., 495 U.S. 545, 547 (1990)). Any collection action on account of such claims, and any potential j ensuing liability, would distract the Debtors and their personnel to the detriment of all parties in interest. The dedicated and active participation of the Debtors' officers and employees is j i integral to the Debtors' continued operations and essential to the orderly administration and, ultimately, the success of these chapter 11 cases. 24. Furthermore, the. Debtors'..liability to pay the Taxes and Fees may ultimately result in increased tax liability for the Debtors if interest and penalties accrue on the claims for i j t i i i i 12

13 Case Doc 6 Filed 10/04/18 Page 13 of 17 Taxes and Fees, which amounts may also be entitled to priority treatment. Such a result would be contrary to the best interests of the Debtors' estates and all stakeholders. As noted above, many of the Taxes and Fees may be entitled to priority status pursuant to section 507(a)(8)(C) of the Bankruptcy Code. As priority claims, these obligations must be paid in full before any general unsecured obligations of the Debtors may be satisfied. To the extent that the Debtors are not able to timely pay the prepetition Taxes and Fees, they may ultimately be required to pay those amounts with additional interest and penalties. The Debtors' failure to pay the prepetition Taxes and Fees as they come due may, thus, ultimately increase the amount of priority claims held by the Authorities against the Debtors' estates to the detriment of the Debtors' general unsecured creditors. See 11 U.S.C. 507(a)(8)(C) and 507(a)(8)(G). Accordingly, the Court should grant the Debtors authority to pay the prepetition Taxes and tees as provided herein. 25. Courts in this jurisdiction have authorized payment of prepetition taxes under sections 105(a) and 363(b) of the Bankruptcy Code. See, e.g., In re VER Techs. Holdco LLC, No (KG)(Bankr. D. Del. May 4, 2018) (authorizing debtors to pay prepetition taxes and fees in the ordinary course of business); In re TK Holdings Inc., No (BLS) (Bankr. D. Del. Jul. 26, 2017) (same); In re TidewateN Inc., No (BLS) (Bankr. D. Del. Jun. 13, 2013) (same); In Ne CST Industries Holdzng Inc., No (BLS) (Bankr. D. Del. Jun. 13, 2017) (same); In re Dex Media, Inc., No (KG) (Bankr. D. Del. May 16, 2016) (same).9 ~ Because of the voluminous nature of the orders cited herein, such orders have not been attached to this Motion. Copies of these orders are available upon request to the Debtors' proposed counsel. 13

14 Case Doc 6 Filed 10/04/18 Page 14 of 17 IV. Cause Exists to Authorize the Debtors' Financial Institutions to Honor Checks and Electronic Fund Transfers. 26. The Debtors have sufficient funds to pay the amounts described in this Motion in the ordinary course of business by virtue of expected cash flows from ongoing business operations and anticipated access to debtor-in-possession financing and cash collateral. In addition, under the Debtors' existing cash management system, the Debtors can readily identify checks or wire transfer requests as relating to an authorized payment in respect of the Taxes and Fees. Accordingly, the Debtors believe that checks or wire transfer requests, other than hose relating to authorized payments, will not be honored inadvertently. Therefore, the Debtors respectfully request that the Court authorize all applicable financial institutions, when requested by the Debtors, to receive, process, honor, and pay any and all checks or wire transfer requests in respect of the relief requested in this Motion. The Requirements of Bankruptcy Rule 5003 Are Satisfied 27. Bankruptcy Rule 6003 empowers a court to grant relief within the first 21 days after the Petition Date "to the extent that relief is necessary to avoid immediate and irreparable harm." For the reasons discussed above, authorizing the Debtors to pay the Taxes and Fees that in the ordinary course of business as well as granting the other relief requested herein is integral to the Debtors' ability to transition their operations into these chapter 11 cases. Failure to receive such authorization and other relief during the first 21 days of these chapter 11 cases would severely disrupt the Debtors' operations at this critical juncture. For the reasons discussed herein, the relief requested is necessary in order for the Debtors to operate their businesses in the ordinary course and preserve the ongoing value of the Debtors' operations and maximize the value of their estates for the benefit of all stakeholders. Accordingly, the Debtors submit that 14

15 Case Doc 6 Filed 10/04/18 Page 15 of 17 they have satisfied the "immediate and irreparable" standard of Bankruptcy Rule 6003 to support granting the relief requested herein. Waiver of Bankruptcy Rule 6404(a) and 6004(h) 28. To implement the foregoing successfully, the Debtors seek a waiver of the notice requirements under Bankruptcy Rule 6004(a) and the 14-day stay of an order authorizing the use, sale, or lease of property under Bankruptcy Rule 6004(h). Reservation of Rights 29. Nothing contained herein is intended or shall be construed as: (a) an admission as to the amount of, basis for, or validity of any claim against the Debtors under the Bankruptcy Code or other applicable nonbankruptcy law; (b) a waiver of the Debtors' or any other party in interest's right to dispute any claim, (c) a promise or requirement to pay any particular claim; (d) an implication or admission that any particular claim is of a type specified or defined in this Motion; (e) a request or authorization to assume, adopt, or reject any agreement, contract, or lease pursuant to section 365 of the Bankruptcy Code; (~ an admission as to the validity, priority, enforceability, or perfection of any lien on, security interest in, or other encumbrance on property of the Debtors' estates; or (g) a waiver of any claims or causes of action which may exist against any entity under the Bankruptcy Code or any other applicable law. If the Court grants the relief sought herein, any payment made pursuant to the Court's order is not intended and should not be construed as an admission as to the validity of any particular claim or a waiver of the Debtors' rights to subsequently dispute such claim. Notice 30. The Debtors have provided notice of this Motion to the following parties or their respective counsel: (a) the office of the U.S. Trustee for the District of Delaware; (b) the holders of the 30 largest unsecured claims against the Debtors (on a consolidated basis); (c) the agent 15

16 Case Doc 6 Filed 10/04/18 Page 16 of 17 under the Debtors' prepetition asset-based facility; (d) the agent under the Debtors' prepetition term loan facility; (e) the indenture trustee for the Debtors' senior subordinated notes; (~ the ad hoc committee for the Debtors' senior subordinated noteholders; (g) the ad hoc committee for the Debtors' prepetition term loan facility; (h) the United States Attorney's Office for the District of Delaware; (i) the Internal Revenue Service; (j) the office of the attorneys general for the states in which the Debtors operate; (k) the Authorities; and (1) any party that has requested notice pursuant to Bankruptcy Rule As this Motion is seeking "first day" relief, within two business days of the hearing on this Motion, the Debtors will serve copies of this Motion and any order entered in respect to this Motion as required by Local Rule (m). The Debtors submit that, in light of the nature of the relief requested, no other or further notice need be given. No Prior Request 31. No prior request for the relief sought in this Motion has been made to this or any other court. [RemaindeN of page intentionally left blank. ] 16

17 Case Doc 6 Filed 10/04/18 Page 17 of 17 WI~EREFORE, the Debtors respectfully request that the Court enter the Interim and Final Order granting the relief requested herein and such other relief as the Court deems appropriate under the circumstances. Dated: October 4, 2018 Wilmington, Delaware...~,aura Dais Jones (DE Bar No. 2436) Timothy P. Cairns (DE Bar No. 4228) Joseph M. Mulvihill (DE Bar No. 6061) PACHULSI~I STANG ZIEHL &JONES LLP 919 North Market Street, 17th Floor P.O. Box 8705 Wilmington, Delaware (Courier 19801) Telephone: (302) Facsimile: (302) lj law. com tcairns@pszj law.com j mulvihill@pszj law. com - and - James H.M. Sprayregen, P.C. Anup Sathy, P.C. (pro hac vice pending) Chad J. Husnick, P.C. (pno hac vice pending) Spencer Winters (pno hac vice pending) ~IRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 300 North LaSalle Chicago, Illinois Telephone: (312) Facsimile: (312) james.sprayregen@kirkland.com anup. lathy@kirkland. com chad. husnick@kirkland. com spencer. winters@kirkland. com PNoposed Counsel to the DebtoNs and Debtors in Possession

18 Case Doc 6-1 Filed 10/04/18 Page 1 of 6 Exhibit A Proposed Interim Order

19 Case Doc 6-1 Filed 10/04/18 Page 2 of 6 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re: ) Chapter 11 ATD CORPORATION, et al.,l ) Case No (_) Debtors. ) (Joint Administration Requested) Re: Docket No. _ INTERIM QRDER (I) AUTHORIZING SHE P~YIl~IEllTT OF CEI~~'t~IN PR.EP'EZ'I'TION AND POSTPETITION TAXES AND FEES ANI) (II) GRANTING RELATED RELIEF Upon the motion (the "Motion")2 of the above-captioned debtors and debtors in possession (collectively, the "Debtors") for entry of an interim order (this "Interim Order"): (a) authorizing, but not directing, the Debtors to remit and pay undisputed prepetition Taxes and Fees in the ordinary course of business, (b) granting related relief, and (c) scheduling a final hearing to consider approval of the Motion on a final basis, all as more fully set forth in the Motion; and upon the First Day Declaration; and this Court having jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334 and the Amended Standing Order of Reference from the United States District Court for the District of Delaware, dated February 29, 2012; and that this Court may enter a final order consistent with Article III of t~~e United States Constitution; and this Court having found that venue of this proceeding and the Motion in this district is proper pursuant to 28 U.S.C and 1409; and this Court having found that the relief requested in ' The Debtors in these chapter 11 cases, along with the last four digits of each Debtor's federal tax identification number, where applicable, include: ATD Corporation (3683); Accelerate Holdings Corp. (0528); American Tire Distributors Holdings, Inc. (6143); American Tire Distributors, Inc. (4594); Rubbr Automotive Services, LLC (3334); The Hercules Tire &Rubber Company (3365); Teriy's Tire Town Holdings, Inc. (7464); Tire Pros Fraricorp (1361); and Hercules Asia Pacific, LLC (2499). The location of the Debtors' service address in these chapter 11 cases is Herbert Wayne Court, Suite 150, Huntersville, North Carolina Z Capitalized terms used but not otherwise defined herein have the meanings ascribed to them in the Motion.

20 Case Doc 6-1 Filed 10/04/18 Page 3 of 6 the Motion is in the best interests of the Debtors' estates, their creditors, and other parties in interest; and this Court having found that the Debtors' notice of the Motion and opportunity for a hearing on the Motion were appropriate under the circumstances and no other notice need be provided; and this Court having reviewed the Motion and having heard the statements in support of the relief requested therein at a hearing before this Court (the "Hearing"); and this Court having determined that the legal and factual bases set forth in the Motion and at the Hearing establish just cause far the relief granted herein; and upon all of the proceedings had before this Court; and after due deliberation and sufficient cause appearing therefor, it is HEREBY ORDERED THAT: 1. The Motion is granted on an interim basis as set forth herein. 2. The final hearing (the "Final Hearing") on the Motion shall be held on 2018, at :.m., prevailing Eastern Time. Any objections or responses to entry of a final order on the Motion shall be filed on or before 4:00 p.m, prevailing Eastern Time on 2018, and served on the following parties: (a) the Debtors, ATD Corporation, Herbert Wayne Court, Suite 150, Huntersville, North Carolina 28078, Attn: Gail Sharps Myers, General Counsel; (b) proposed counsel to the Debtors, Kirkland &Ellis LLP, 300 North LaSalle, Chicago, Illinois 60654, Attn: Anup Sathy, P.C., Chad J. Husnick, P.C., and Spencer Winters; (c) proposed co-counsel to the Debtors, Pachulski Stang Ziehl &Jones LLP, 919 North Market Street, 17th Floor, P.O. Box 8705, Wilmington, Delaware (Courier 19801), Attn: Laura Davis Jones; (d) the Office of the United States Trustee for the District of Delaware, 844 King Street, Suite 2207, Locicbox 35, Wilmington, Delaware 19801, Attn: Timothy J. Fox, Jr., Esq.; (e) counsel to the DIP FILO Lenders and Consenting Noteholders (each as defined in the First Day Declaration), Akin Gump Strauss Hauer &Feld LLP, One Bryant Park, New York,

21 Case Doc 6-1 Filed 10/04/18 Page 4 of 6 New York 10036, Attn: Ira Dizengoff, Philip Dublin, and Naomi Moss; (~ counsel to the agents for the Debtors' prepetition revolving credit facility and postpetition financing facility, Parker, Hudson, Rainer &Dobbs, LLP, 303 Peachtree Street N.E., Suite 3600, Atlanta, Georgia 30308, Attn: C. Edward Dobbs and Eric W. Anderson, and Richards Layton &Finger, P.A., One Rodney Square, 920 North King Street, Wilmington, Delaware 19801, Attn: John H. Knight; (g) counsel to the ad hoc committee of term lenders under the Debtors' prepetition term loan facility Paul, Weiss, Rifkind, Wharton &Garrison LLP, 1285 Avenue of the Americas, New York, New York 10017, Attn: Brian S. Hermann, Esq., Jacob A. Adlerstein, Esq., and Eugene Y. Park, Esq.; and (h) counsel to the official committee of unsecured creditors (if any) appointed in these chapter 11 cases (collectively, the "Notice Parties"). 3. The Debtors are authorized, but not directed, to: (a) pay or remit the Taxes and Fees that accrued prior to the Petition Date and that will become payable in the ordinary course during the pendency of these chapter 11 cases at such time when the Taxes and Fees are payable, in an aggregate interim amount not to exceed $5,500,000 and (b) pay Taxes and Fees that arise or accrue in the ordinary course of business on a postpetition basis consistent with prepetition practices; pnovided, however, that the authority of the Debtors to make any payments under this Interim Order is subject to the terms and conditions of the DIP Credit Agreement (as defined in the First Day Declaration) and the interim and final orders of this Court approving the financing provided thereunder, including, without limitation, that such payments must comply with the DIP Budget under, and as defined in, the DIP Credit Agreement. 4. Subject to the terms of the Cash Management Order (as defined in the First Day Declaration), the banks and financial institutions on which checks were drawn or electronic payment requests made in payment of the prepetition obligations approved herein are authorized 3

22 Case Doc 6-1 Filed 10/04/18 Page 5 of 6 to receive, process, honor, and pay all such checks and electronic payment requests when presented for payment, and all such banks and financial institutions are authorized to rely on the Debtors' designation of any particular check or electronic payment request as approved by this Interim Order. 5. Notwithstanding the relief granted in this Interim Order and any actions taken pursuant to such relief, nothing in this Interim Order shall be deemed: (a) an admission as to the validity of any prepetition claim against a Debtor entity; (b) a waiver of the Debtors' or any other party in interest's right to dispute any prepetition claim on any grounds; (c) a promise or requirement to pay any prepetition claim; (d) an implication or admission that any particular claim is of a type specified or defined in the Motion; (e) a request or authorization to assume any prepetition agreement, contract, or lease pursuant to section 365 of the Bankruptcy Code; or (~ a waiver of the Debtors' or any other party in interest's rights under the Bankruptcy Code or any other applicable law. 6. Subject to the terms of the Cash Management Order, the Debtors are authorized to issue postpetition checks, or to effect postpetition fund transfer requests, in replacement of any checks or fund transfer requests that are dishonored as a consequence of these chapter 11 cases with respect to prepetition amounts owed in connection with the relief granted herein. 7. Nothing in this Interim Order authorizes the Debtors to accelerate any payments not otherwise due prior to the date of the Final Hearing. 8. Notwithstanding the relief granted in this Interim Order, any payment made by the Debtors pursuant to the authority granted herein shall be subject to any order authorizing use of cash collateral The contents of the Motion satisfy the requirements of Bankruptcy Rule 6003(b).

23 Case Doc 6-1 Filed 10/04/18 Page 6 of Notice of the Motion as provided therein shall be deemed good and sufficient notice of such Motion and the requirements of Bankruptcy Rule 6004(a} are satisfied by such notice. 11. Notwithstanding Bankruptcy Rule 6004(h), the terms and conditions of this Interim Order are immediately effective and enforceable upon its entry. 12. The Debtors are authorized to take all actions necessary to effectuate the relief granted in this Interim Order in accordance with the Motion. 13. This Court retains exclusive jurisdiction with respect to all matters arising from or related to the implementation, interpretation, and enforcement of this Interim Order. Dated:, 2018 Wilmington, Delaware United States Bankruptcy Judge 5

24 Case Doc 6-2 Filed 10/04/18 Page 1 of 5 Exhibit B Proposed Final Order

25 Case Doc 6-2 Filed 10/04/18 Page 2 of 5 IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELA~JVARE In re: ) Chapter ll ATD CORPORATION, et al.,i ) Case No O Debtors. ) (Joint Administration Requested) Re: Docket No. _ FINAL ORDER (I) AUTHORIZING THE PAYMENT OF CERTAIN PREPETITION t~l~i) P~ST~'~~'I'TI01~1 ~A~ES A1~1I) FEES A1~tD (II) GRAl~'TIlVG RELATED ~2EI.IEF Upon the motion (the "Motion")2 of the above-captioned debtors and debtors in possession (collectively, the "Debtors") for entry of an final order (this "Final Order"): (a) authorizing, but not directing, the Debtors to remit and pay undisputed prepetition Taxes and Fees in the ordinary course of business and (b) granting related relief, all as more fully set forth in the Motion; and upon the First Day Declaration; and this Court having jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334 and the Amended Standzng ONder of Reference from the United States District Court for the District of Delaware, dated February 29, 2012; and that this Court may enter a final order consistent with Article III of the United States Constitution; and this Court having found that venue of this proceeding and the Motion in this district is proper pursuant to 28 U.S.C and 1409; and this Court having found that the relief requested in the Motion is in the best interests of the Debtors' estates, their creditors, and other parties in interest; and this Court having found that the Debtors' notice of the Motion and ' The Debtors in these chapter 11 cases, along with the last four digits of each Debtor's federal tax identification number, where applicable, include: ATD Corporation (3683); Accelerate Holdings Corp. (0528); American Tire Distributors Holdings, Inc. (6143); American Tire Distributors, Inc. (4594); Rubbr Automotive Services, LLC (3334); The Hercules Tire &Rubber Company (3365); Terry's Tire Town Holdings; Inc. (7464); Tire Pros Francorp (1361); and Hercules Asia Pacific, LLC (2499). The location of the Debtors' service address in these chapter 11 cases is Herbert Wayne Court, Suite 150, Huntersville, North Carolina Z Capitalized terms used. but not otherwise defined herein have the meanings ascribed to them in the Motion.

26 Case Doc 6-2 Filed 10/04/18 Page 3 of 5 opportunity for a hearing on the Motion were appropriate under the circumstances and no other notice need be provided; and this Court having reviewed the Motion and having heard the statements in support of the relief requested therein at a hearing before this Court (the "Hearin "); and this Court having determined that the legal and factual bases set forth in the Motion and at the Hearing establish just cause for the relief granted herein; and upon all of the proceedings had before this Court; and after due deliberation and sufficient cause appearing therefor, it is HEREBY ORDERED THAT: 1. The Motion is granted on a final basis as set forth herein. 2. The Debtors are authorized, but not directed, to: (a) pay or remit the Taxes and Fees that accrued prior to the Petition Date and that will become payable in the ordinary course during the pendency of these chapter 11 cases at such time when the Taxes and Fees are payable and (b) pay Taxes and Fees that arise or accrue in the ordinary course of business on a postpetition basis consistent with prepetition practices; pnovided, however, that the authority of the Debtors to make any payments under this Final Order is subject to the terms and conditions of the DIP Credit Agreement (as defined in the First Day Declaration) and the interim and final orders of this Court approving the financing provided thereunder, including, without limitation, that such payments must comply with the DIP Budget under, and as defined in, the DIP Credit Agreement. 3. Subject to the terms of the Cash Management Order (as defined in the First Day Declaration), the banks and financial institutions on which checks were drawn or electronic payment requests made in payment of the prepetition obligations approved herein are authorized to receive, process, honor, and pay all such checks and electronic payment requests when presented for payment, and all such banks and financial institutions are authorized to rely on the 2

27 Case Doc 6-2 Filed 10/04/18 Page 4 of 5 Debtors' designation of any particular check or electronic payment request as approved by this Tinal Order. 4. Notwithstanding the relief granted in this Final Order and any actions taken pursuant to such relief, nothing in this Final Order shall be deemed: (a) an admission as to the validity of any prepetition claim against a Debtor entity; (b) a waiver of the Debtors' or any other party in interest's right to dispute any prepetition claim on any grounds; (c) a promise or requirement to pay any prepetition claim; (d) an implication or admission that any particular claim is of a type specified or defined in this Final Order or the Motion; (e) a request or authorization to assume any prepetition agreement, contract, or lease pursuant to section 365 of the Bankruptcy Code; or (fj a waiver of the Debtors' or any other party in interest's rights under the Bankruptcy Code or any other applicable claim. 5. Subject to the terms of the Cash Management Order, the Debtors are authorized to issue postpetition checks, or to effect postpetition fund transfer requests, in replacement of any checks or fund transfer requests that are dishonored as a consequence of these chapter 11 cases with respect to prepetition amounts owed in connection with the relief granted herein. 6. Notwithstanding the relief granted in this Final Order, any payment made by the Debtors pursuant to the authority granted herein shall be subject to any order authorizing use of cash collateral. 7. Notice of the Motion as provided therein shall be deemed good and sufficient j i notice of such Motion and the requirements of Bankruptcy Rule 6004(a) are satisfied by such i notice. 8. Notwithstanding.Bankruptcy Rule 6004(h),.the. terms and. conditions of this Final Order are immediately effective and enforceable upon its entry. i

28 Case Doc 6-2 Filed 10/04/18 Page 5 of 5 9. The Debtors are authorized to take all actions necessary to effectuate the relief granted in this Final Order in accordance with the Motion. 10. This Court retains exclusive jurisdiction with respect to all matters arising from or related to the implementation, interpretation, and enforcement of this Final Order. Dated:, 2018 Wilmington, Delaware United States Bankruptcy Judge

29 Case Doc 6-3 Filed 10/04/18 Page 1 of 21 Exhibit C Authorities _ sxn~~~ (or, ~vherc - a~}~licable, G~~tEIiNM.Ei~'3'.~I: ~t3`ptioi2ity ADI)ItE~5 7 AUIDI2GSS 2.AD3~i2ESS 3 CITY PIiaVINCE} e'~.i~' Gt7Ul~iTl2 TYPE ADAMS COtTNTY TREASURER PO BOX 869 BRIGHTON CO US Property ALABAMA DEPARTMENT OF SALES AND USE TAX DIVISION PO BOX MONTGOMERY AL US Sales &Use REVEIViJE ALAMANCE COL7NTY TAX COLLECTOR 124 W ELM GRAI~AM NC US Property ALDINE ISD -TAX OFFICE PO BOX HOUSTON TX US Property ANN HARRIS BENNETT PO SOX 4576 TAX ASSESSOR- HOUSTON TX US Property COLLECTOR ARIZONA DEPT OF REVENUE PO BOX PHOENIX AZ US Business Taxes and AUGUSTA LICENSE & INSPECTIO PO BOX MARVIN GRIFFIN RD AUGUSTA GA US Business Takes and BALDWIN COI7NTY PO BOX 189 ROBERTSDALE AL US Sales &Use BERNALILLO COUNTY ONE CIVIC PLAZA NW BASEMENT ALBUQUERQUE NM US Property TREASURER BETSY PRICE, TARRAN"t COUNTY TAX ASSESSOR-COLLECTOR PO BOX FORT WORTH TX US Property BEXAI2 COUNTY PO BOX 2903 SAN ANTOl~IO TX US Property BRANDY EASLICK PROBATE 2 LAFAYETTE ST S STE B LAFAYETTE AL US Business Taxes and JiJDGE BROWARD COIJNTYREVENUE 115 S ANDREWS AVE RM A-100 ATT: BUSINESS TAX FORT FL US Property COLLECTOR DEPARTMENT LAUDERDALE BUNCOMBE COIIN'I'Y 94 CORE AVE ASHVILLE NC US Property CALHOLTN COUN'T'Y BARRY E ROBERTSON CONIIvIISSIONER flf 1702 NOBLE ST ANNISTON AL US Business Taxes and LICENSES CAN YON COUNTY TAX 111 N 11TH ST STE 240 CALDWELL ID US Property COLLECTOR CARROLLTON-FARMERS BRANCH PO BOX CARROLLTON TX US Property ISD CARSON CITY TREASURER BUSINESS LICENSE DEPT 108 E PROCTOR ST CARSON CITY NV US Business Taxes and CHARLESTON COUNTY REVEN[JE COLLECTION DEPT 4045 BRIDGE VIEW DR NORTH SC US Property TREASURER CHARLESTON