ATD Still Has Outstanding Wholesale Business Debt to Monro

American Tire Distributors Inc. (ATD) faced challenges following its bankruptcy in 2024 in fulfilling its financial obligations to Monro Inc. The wholesale distributor’s bankruptcy impacted the final payments ATD was supposed to make to Monro Inc., resulting in a remaining balance of approximately $7 million.

In response to the outstanding balance owed to Monro, the company’s attorneys filed an objection in ATD’s bankruptcy case in December. The amendment to the agreement between the two companies was finalized recently, with the remaining balance being divided in half. Two equal payments were scheduled for February 21, 2025, and June 25, 2025, to address the outstanding amount owed to Monro.

According to a filing with the U.S. Securities and Exchange Commission (SEC), once these payments are completed, Monro’s earnout payments will be fully settled. The nearly $7 million balance represents only a fraction of the total $102 million that ATD had agreed to pay for Monro’s tire inventory and wholesale distribution assets. An initial payment of $62 million was made when the transaction closed in June 2022, with the remaining $40 million intended to be paid in a series of quarterly installments over approximately two years.

As part of the original agreement, Monro’s retail stores were required to purchase “at least 90%” of their passenger, light truck, and medium truck tires from ATD. Additionally, Monro earned an “earnout per-tire amount” from ATD based on its tire purchases in the first 12 months following the transaction closure.

In a February 2025 filing with the SEC, Monro highlighted certain changes to the terms of service level agreements between the two parties. ATD also committed to making commercially reasonable efforts to ensure consistent product supply to meet Monro’s demands under the agreement. Specific details regarding these changes were not disclosed.

The resolution of the outstanding balance owed to Monro signifies progress in addressing the financial implications of ATD’s bankruptcy on its business dealings. By adhering to the revised payment schedule and terms, both companies are working towards fulfilling their obligations and maintaining a fruitful business relationship.