FOURTH AMENDMENT TO DISTRIBUTION SERVICE AGREEMENT

Exhibit 10.35

FOURTH AMENDMENT TO DISTRIBUTION SERVICE AGREEMENT

THIS FOURTH AMENDMENT TO DISTRIBUTION SERVICE AGREEMENT (the “Amendment”) is made and entered into on the 16th day of October, 2003, to be effective on the Effective Date (as defined below), by and between The Pantry, Inc., a Delaware corporation (“Pantry”) and XxXxxx Company, Inc., a Texas corporation (“McLane”).

RECITALS

WHEREAS, the Pantry, Lil’ Champ Food Stores, Inc., a Florida corporation (“Lil’ Champ”), and McLane entered into (i) a Distribution Service Agreement effective as of October 10, 1999, (ii) a First Amendment to Distribution Service Agreement effective as of June 28, 2001, (iii) a Second Amendment to Distribution Service Agreement effective as of September 8, 2001, and (iv) a Third Amendment to Distribution Service Agreement effective as of October 5, 2002 (the October 10, 1999 Distribution Service Agreement, together with the June 28, 2001 First Amendment, September 8, 2001 Second Amendment, and October 5, 2002 Third Amendment are hereinafter referred to collectively as the “Service Agreement”); and

WHEREAS, the Pantry is in negotiations to acquire additional convenience food stores that it desires to make subject to the Service Agreement, such additional stores being more particularly described on Exhibit A attached hereto and incorporated herein for all purposes (the “Additional Stores”); and

WHEREAS, in the event the Pantry acquires the Additional Stores, the Pantry and McLane desire to further amend the Service Agreement;

NOW, THEREFORE, for and in consideration of the promises, covenants and conditions contained herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, and expressly conditioned upon the Pantry acquiring the Additional Stores, the Pantry and McLane do hereby agree as follows:

1. Additional Stores to be Subject to Service Agreement. The Pantry and McLane hereby agree that the Additional Stores shall, effective as of the date the Pantry acquires such Additional Stores (the “Effective Date”), be subject to and governed by all terms and conditions of the Service Agreement, as amended by this Amendment, and shall be considered “stores” for all purposes thereof.

2. Extension of Service Agreement. The first sentence of Section 4.1 of the Service Agreement is hereby amended to read in its entirety as follows:

* Selected portions have been deleted as confidential pursuant to Rule 24b-2. Complete copies of the entire exhibit have been filed with the Securities and Exchange Commission and marked “CONFIDENTIAL TREATMENT.”

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“This Agreement shall, unless earlier terminated in accordance with the terms of this Agreement, continue until October 10, 2008.”

3. Adjustment of Service Charge/Gatorade Xxxx-Up. The Service Charge of $* per store/per week provided for in the Service Agreement is reduced to $* per store/per week and the markup on Gatorade provided for in the Service Agreement is reduced from *% to *%.

4. Cigarette Rebate Adjustment. The Pantry shall be entitled, in addition to the rebates provided for in the Service Agreement and on Exhibit A of the Service Agreement, to an additional rebate of (i) $* (*) per each carton of premium cigarettes and $* (*) per each carton of generic cigarettes purchased by the Pantry from McLane after the Effective Date for stores located in Georgia, and (ii) $* (*) per each carton of premium cigarettes and $* (*) per each carton of generic cigarettes purchased by the Pantry from McLane after the Effective Date for stores located in Tennessee.

5. Service Allowance. Section 9 of the Third Amendment is hereby amended to read in its entirety as follows:

“Within ten (10) business days after the Effective Date, McLane shall pay to the Pantry $* per each Additional Store and $* for each other store subject to the Service Agreement. Such amounts shall be amortized over the twelve (12) month period immediately following the Effective Date using the straight line method of amortization, with any unamortized amount relating to a store which the Pantry sells, closes or otherwise ceases to operate during such twelve (12) month period being repaid to McLane within ten (10) days after the end of the McLane accounting quarter in which such sale, closure or cessation of operation occurs through an equitable adjustment made by McLane to any amounts that may be owing by McLane to any amounts that may be owing by McLane to Pantry at the end of such McLane accounting quarter. If the unamortized amount to be repaid to McLane at the end of such accounting quarter is greater than the amount that is owed by McLane to Pantry, the remaining adjustment will be made at the end of subsequent McLane accounting quarters until the full unamortized amount is repaid by Pantry to McLane. Provided the Pantry is in compliance with all terms and conditions of the Service Agreement (as amended by this Amendment) on the date payment is due, within ten (10) business days after the beginning of each McLane accounting quarter, McLane agrees to pay to the Pantry a Service Allowance of $*. This quarterly amount is based on * stores and $* per store; and shall be adjusted equitably during the remaining term of the Service Agreement (as amended by this Amendment) to take into account store openings and store sales/closures.”

* Selected portions have been deleted as confidential pursuant to Rule 24b-2. Complete copies of the entire exhibit have been filed with the Securities and Exchange Commission and marked “CONFIDENTIAL TREATMENT.”

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CONFIDENTIAL TREATMENT

6. Representation and Warranty. Pantry hereby represents and warrants to McLane that Lil’ Champ has been merged into The Pantry, Inc. and is no longer a legal entity as of June 25, 2001. As of the Effective Date, Lil’ Champ will be released by McLane as a party to the Service Agreement. In consideration, Pantry represents and warrants to McLane, and Pantry agrees that (i) all existing Lil’ Champ stores previously serviced by McLane (“Lil’ Champ Stores”) have been transferred to and are owned entirely by Pantry, (ii) McLane will continue to provide services under the Service Agreement and this Amendment to the Lil’ Champ Stores, and (iii) Pantry will be fully responsible and liable to McLane for the performance of any and all obligations and liabilities of Lil’Champ to McLane under the Service Agreement and this Amendment.

7. Effective Date. All terms and conditions of this Amendment shall be effective as of the Effective Date defined in Section 1 of this Amendment.

8. Defined Terms. Capitalized terms not specifically defined in this Amendment shall have the meaning ascribed to them in the Service Agreement.

9. No Other Modifications. Except as specifically modified by this Amendment, all terms and conditions of the Service Agreement shall remain fully applicable and in full force and effect.

IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first written above, to be effective as of the Effective Date.

THE PANTRY, INC.
By:		/S/    XXXXX X. XXXXXXXX
Printed Name:    Xxxxx X. Xxxxxxxx
Title:    V.P. Marketing
McLANE PANTRY, INC.
By:		/S/    XXXX XXXXXXXX
		Xxxx Xxxxxxxx
		Division President
		McLane Carolina/Mid-Atlantic

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CONFIDENTIAL TREATMENT

EXHIBIT A

GOLDEN GALLON STORE LIST

Count		Xxxxxx Xxxxx #		Xxxxx #		Xxxxxxx		Xxxx		Xxxxx		Xxx
0		3492		1		SHALLOWFORD & XXXXXXX XXXXXX		Xxxxxxxxxxx		XX		00000
2		3493		5		000 XXXXXXXX XX @ XXXXXXX XXXX		Xxx Xxxx		XX		00000
3		3494		16		00000 XXXXXX XXXX		Xxxxx Xxxxx		XX		00000
4		3495		18		0000 XXXXXXXX XXXX		Xxxxxxxxxxx		XX		00000
5		3496		26		(0000 XXX XXXXXXX)		Xxxxxxxx		XX		00000
6		3497		28		0000 XXXXXX XXXX @X-00		Xxxxxxxx		XX		00000
7		3498		31		0000 XXXXX XXX XXXX		Xxxxxxxx		XX		00000
8		3499		00		XXXXXX XXX 00 @000 XXXXX XX		Xxxxxxxxxx		XX		00000
9		3500		52		000 XXXXX XXXXX XXXXXX		Xxxxxxxxxxxx		XX		00000
10		3501		60		0000 XXXXXXXXX XXXXXXX		Xxxxxxx		XX		00000
11		3502		61		0000 XXXXXXXXXX XXXXXXX		Xxxxxx		XX		00000
12		3503		62		0000 XXXXXXX XXXXXXX		Xxxxxxxx		XX		00000
13		3504		63		0000 XXXXXXXXXXX XXXX		Xxxxx Xxxx		XX		00000
14		3505		64		0000 X. XXXXX XXXXXXX		Xxxxxx		XX		00000
15		3506		00		XXXXXXXXXXX XXXXXX XXXX		Xxxxxxxxx		XX		00000
16		3507		00		XXXXXXX 00 XXXXX		Xxxx Xxxxxxx		XX		00000
17		3508		67		0000 XXXXXXXXX XXXXXX		Xxxxxxxxx		XX		00000
18		3509		00		XXXX XXXX		Xxxxxxxxx		XX		00000
19		3510		00		XXXX XXXX @XXXXXXXXXXX XXXXXX		Xxxxxxxxx		XX		00000
20		3511		72		000 XXX & XXXXXX XXXX XXXX		Xxxxxxxxxxx		XX		00000
21		3512		75		0000 XXXXXXXXX XXXX		Xxxxxx		XX		00000
22		3513		76		0000 XXX XXX XXXX		Xxxxxxx		XX		00000
23		3514		77		(4806 XXXXXXX 00 XXXXX)		Xxxxxxxxxxx		XX		00000
24		3515		78		0000 X. XXXXXXXX @XXXXXX XXXX		Xxxxxxxxxxx		XX		00000
25		3516		00		XXXXXXX 000 XXXXX		Xxxxxxxxxx		XX		00000
26		3517		82		0000 XXX XXXXXXX @XXXXXXXXXXX		Xxxxxxxxxxx		XX		00000
27		3518		00		XXXXXX XXX 000 @XXX 00		Xxxxxxx		XX		00000
28		3519		84		(702 E. HIGHWAY 53 SE)		Xxxxxxx		XX		00000
29		3520		85		00000 XXXXXXX 00		Xxxxxxxxxxx		XX		00000
30		3521		86		000 XXXXXXX XXXXXXX		Xxxxxxxxxxx		XX		00000
31		3522		88		0000 XXXXX XXXXXX		Xxxxxxx		XX		00000
32		3523		89		0000 X XXXXXX XXX @XXXXXXXXX		Xxxxxx		XX		00000
33		3524		90		234 XXXXX’X XXXXX XX @X-00		Xxxxxxxxxxx		XX		00000
34		3525		91		000 XXXXXXXXXX XXXX XX		Xxxxxx		XX		00000
35		3526		00		XXXX XXXXXXXX & XX 000		Xxxxxxxxxx		XX		00000
36		3527		93		0000 XXXXXXXX XXXXXXX		Xxxxxxxxxxx		XX		00000
37		3528		95		000 X XXXX XXXXXX @XX 00		Xxxxxxx		XX		00000
38		3529		96		0000 XXX 00 @XXXXXXX XXXXXX		Xxxxxxxxxxx		XX		00000

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CONFIDENTIAL TREATMENT

Count		Xxxxxx Xxxxx #		Xxxxx #		Xxxxxxx		Xxxx		Xxxxx		Xxx
00		3530		101		1321 DUG GAP		Xxxxxx		XX		00000
40		3531		102		0000 XXXXXXXXX XXXXXX		Xxxxxx		XX		00000
41		3532		103		0000 XXXXXXX XXXXXX		Xxxx		XX		00000
42		3533		105		5501 HWY 000 @XXXX XXXX		Xxxxxx		XX		00000
43		3534		106		0000 XXXXX XXXX XXXXXX		Xxxxxxxxx		XX		00000
44		3535		107		0000 XXXXXXXXXXX XXXX		Xxxxxxxxx		XX		00000
45		3536		109		0000 XXXXXXX XXX, XX @XXX 00		Xxxx		XX		00000
46		3537		110		0000 XXXXXX XXXXX XXXXXXX XX		Xxxx		XX		00000
47		3538		113		00000 XXXXXX XXXX		Xxxxx Xxxxx		XX		00000
48		3539		114		0000-X XXXXXX XXXX @XXX XXXX		Xxxxxx		XX		00000
49		3540		117		0000 XXXXXXXX XXXXX XXXX		Xxxxxxxxxxx		XX		00000
50		3541		119		0000 XXXXXX XXXX		Xxxxxx		XX		00000
51		3542		123		0000 XXXXXX XXXX @XXXX XXXX		Xxx Xxxx		XX		00000
52		3543		124		0000 XXXXXX XXXX @XXXXXX XX		Xxx Xxxx		XX		00000
53		3544		125		000 XXXXXX XXXX @SYLVAN		Xxxxxxxxxxx		XX		00000
54		3545		127		0000 XXXX XXXXXX XXXXX		Xxxxxxxxxxx		XX		00000
55		3546		129		0000 XXXXX XXXXXX		Xxxxxxxxx		XX		00000
56		3547		130		0000 XXXXXXXXXX XXXX		Xxxxxxxxx		XX		00000
57		3548		131		000 XXXXX XXXXX XXXXXX		Xxxxxx		XX		00000
58		3549		135		000 XXXXX XXXXX, XX		Xxxx		XX		00000
59		3550		137		000 XXXXXX XXXXXXXX XXXX		Xxxxxxxxxxx		XX		00000
60		3551		138		0 XXXXXXX XXXXXX, XX		Xxxx		XX		00000
61		3552		139		0000 XXXXXXXXX XXXXXX		Xxxxxxxxxxx		XX		00000
62		3553		141		0000 XXXXXXX XXXXXXX		Xxxxxxxx		XX		00000
63		3554		145		000 XXX XXXXXXXX XXXXXXX		Xxxxxxxxxxxx		XX		00000
64		3555		151		0000 XXXXXXXXX XXXX		Xxxxxxxxx		XX		00000
65		3556		152		0000 XXXX XXXXXX		Xxxxxx		XX		00000
66		3557		153		0000 XXXXXX XXXX		Xxxxxx		XX		00000
67		3558		154		000 XXXXXX XXXXXX, XXXXX		Xxxxxx		XX		00000
68		3559		155		0000 XXX XXXXX		Xxxxxxxxxx		XX		00000
69		3560		000		X-00 @XXXXXXX 000		Xxxxxxx		XX		00000
70		3561		000		XXXXX 0, XXX 000 XXXXXXX XX		Xxxxxxxx		XX		00000
71		3562		159		0000 XXXXX XXXXXX XXXXXX		Xxxxxxxxxxxx		XX		00000
72		3563		160		0000 XXX XXX XXXX		Xxxxxxx		XX		00000
73		3564		161		0000 XXXXXXXXX XXX		Xxxx		XX		00000
74		3565		162		0000 XXXXXXXXXXX XXXXXXX		Xxxxxxxxxx		XX		00000
75		3566		163		0000 XXX XXXX XXXXXXX		Xxxxxxxxxxxx		XX		00000
76		3567		165		0000 XXXXXXXXX XXXX		Xxxxxxxxxx		XX		00000
77		3568		166		0000 XXX 00, XX		Xxxxxxxxx		XX		00000
78		3569		167		0000 XXXX XXXXXX XXXXXXX		Xxxxxx		XX		00000
79		3570		168		0000 XXXXXXXX XXXX		Xxxxxxxxxxx		XX		00000
80		3571		170		000 XXXXXXX 000, XXXXX		Xxxxxx		XX		00000
81		3572		173		(4858 XXXXXXX 00)		Xxxxxxxxxxx		XX		00000

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CONFIDENTIAL TREATMENT

Count		Xxxxxx Xxxxx #		Xxxxx #		Xxxxxxx		Xxxx		Xxxxx		Zip
82		3573		176		0000 XXXXXX XXXX @XXX XXXXX		Xxxxxx		XX		00000
83		3574		179		00000 XXXXXX XXXX		Xxxxx Xxxxx		XX		00000
84		3575		181		0000 XXXXXX XXXX		Xxxxx Xxxxx		XX		00000
85		3576		182		0000 XXXXXXXXXXX XX @X. XXXX		Xxxxxxxxxxx		XX		00000
86		3577		183		(0000 XXXXXXXX XXXXXXX)		Xxxxxxxxxxx		XX		00000
87		3578		184		0000 XXXXXXXX XX @XXX XX		Xxxxxx		XX		00000
88		3579		185		0000 XXXXXXXXX XXXX		Xxxxxx		XX		00000
89		3580		000		XXXXX 0, XXX 0000		Xxxxxxxxx		XX		00000
90		3581		187		0000 XXXXXXX XXXX		Xxxxxx		XX		00000
91		3582		188		0000 XXXXXXXX XXX @X-00		Xxxxxxxxxxx		XX		00000
92		3583		189		0000 XXXXX XXXXXXXXXX XXXX		Xxxxxxxxxxxx		XX		00000
93		3584		190		000 XXXXXXX XXXX		Xxxxxxxx		XX		00000
94		3585		192		0000 XXXXXX XXXXXXX		Xxxxxxxxx		XX		00000
95		3586		000		XXX 000 XXX 000X		Xxxxx		XX		00000
96		3587		195		0000 XXXXXXXXXXX XXXXXXX		Xx. Xxxxxxxxxx		XX		00000
97		3588		197		0000 X XXXXXXXX XX @XXX-XXXX		Xxxxxxxxxxx		XX		00000
98		3589		201		000 00XX XXXXXX, XX		Xxxxxxxxx		XX		00000
99		3590		202		0000 XXXX XXXXXX XXXXXX		Xxxxxx		XX		00000
100		3591		203		0000 XXXXX XXXXX		X. Xxxxxxxx		XX		00000
101		3592		204		0000 XXXXXXXXXXX XXXX		Xxxxxxxxx		XX		00000
102		3593		205		0000 XXXX XXXXXXX XXXX		Xxxxxxxxx		XX		00000
103		3594		206		000 XXXX XXXXX XXXXXX		Xxxxxxxxxx		XX		00000
104		3595		000		XXXXXXX 00		Xxxxxxx		XX		00000
105		3596		000		XXXXXXX 00		Xxxxxxxx		XX		00000
106		3597		000		XXX 000 & XXXX XXXXXX		Xxxxxx		XX		00000
107		3598		000		XX. XXXX XXXX & X-00		Xxxxxx		XX		00000
108		3599		213		0000 XXXXXXX 00		Xxxxxxxxxx		XX		00000
109		3600		215		000 XXXXXXXXX XXXXXX		Xxxxxx		XX		00000
110		3601		216		000 XXXXX XXXX XXXXXX		Xxxxxxxxxx		XX		00000
111		3602		217		0000 XXXXXXXXXXX XXXX		Xxxxxxxxxxx		XX		00000
112		3603		218		0000 XXXXXXXX XXXX		Xxxxxxxxx		XX		00000
113		3604		219		0000 XXXXXXXXX XXXXXXX		Xxxxxx		XX		00000
114		3605		220		0000 XXXXXX XXXX		Xxxxxx		XX		00000
115		3606		221		0000 XXXXXXX XXXX		Xxxxxx		XX		00000
116		3607		227		0000 XXXXXXX 00		Xxxxxxxx		XX		00000
117		3608		229		000 XXXXXX XXXX		Xxxxxx		XX		00000
118		3609		230		000 XXXXXXX XXXX		Xxxxxxxxx		XX		00000
119		3610		231		000 XXXXXXXXXX XXXXX		Xxxxxxxxxx		XX		00000
120		3611		232		000 XXXXXXXX XXXXXX XXXX		Xxxxx		XX		00000
121		3612		233		0000-X XXXXXXXXX XXXXXXX		Xxxxxx		XX		00000
122		3613		234		0000 XXXXXXXXXXXX XXXX		XxXxxxxx		XX		00000
123		3614		235		0000 X. XXXXXXXX XXXX		Xxxxxxxxxxx		XX		00000

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CONFIDENTIAL TREATMENT

Count		Xxxxxx Xxxxx #		Xxxxx #		Xxxxxxx		Xxxx		Xxxxx		Zip
124		3615		236		0000 XXXXXXXXXXX XXXXXXX		Xxxxxxxx		XX		00000
125		3616		237		0000 XXXXXXXX XX @XXXXX XX		Xxxxxxxxxxx		XX		00000
126		3617		239		0000 XXXXX XXXXXX XXXXXX		Xxxxxxxxxxxx		XX		00000
127		3618		240		0000 XXXXX XXXXX XXXXXX		Xxxxxxxx		XX		00000
128		3619		243		0000 XXXXXXXXX XXXX		Xxxxxxxxxxx		XX		00000
129		3620		244		00000 XXXXXXX XXXX		Xx. Xxxxxx		XX		00000
130		3621		246		0000 XXXXXXX XX XXXXXXXXXXX		Xxxxxxxxxxx		XX		00000
131		3622		247		(11400 XXXXXXX 00)		Xxxxxxxx		XX		00000
132		3623		248		(600 ASHLAND XXXXXXXX)		Xxxxxxxxxxx		XX		00000
133		3624		250		(2300 XXXXXXX XX)		Xxxxxxxxxxx		XX		00000
134		3625		601		(0000 XXXX XXXX XXXXXX)		Xxxxxxx		XX		00000
135		3626		602		(0000 XXXXXXXX XXXX)		Xxxxxxxxxxxx		XX		00000
136		3627		000		(XXX 00 & XXX XXXXXXXX XXX)		Xxxxxxxxxx		XX		00000
137		3628		000		XXXXXXXXX		Xxxxxxxxx		XX		00000
138		3629		626		(6917 XXXXXX XXXXXX XX)		Xxxxxx		XX		00000

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