<PAGE>
As filed with the Securities and Exchange Commission on May 5, 1999.
Registration No. 333-74751
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
AMENDMENT NO. 1
TO
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
RITE AID CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Delaware 5912 23-1614034
(Primary Standard (I.R.S. Employer
(State or other Industrial Identification No.)
Jurisdiction of Classification Code
Incorporation or Number)
Organization) ----------------
Rite Aid Corporation
30 Hunter Lane
Camp Hill, Pennsylvania 17011
(717) 761-2633
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
----------------
Elliot S. Gerson
Executive Vice President, General Counsel and Secretary
Rite Aid Corporation
30 Hunter Lane
Camp Hill, Pennsylvania 17011
(717) 761-2633
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent for Service)
With a Copy to:
Morgan, Lewis & Bockius LLP
101 Park Avenue
New York, New York 10178
(212) 309-6000
Attn: Howard A. Kenny
----------------
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
If the securities being registered on this form are to be offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [_]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, as amended (the
"Securities Act"), check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
----------------
The Registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this registration statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
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<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to completion, dated May 5, 1999.
Prospectus
RITE AID CORPORATION
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Rite Aid Corporation offers to exchange the "Exchange Securities" consisting
of up to $200,000,000 of its 5 1/2% Notes due December 15, 2000, the "2000
Notes"; $200,000,000 of its 6% Notes due December 15, 2005, the "2005 Notes";
$150,000,000 of its 6 1/8% Notes due December 15, 2008, the "2008 Notes"; and
$150,000,000 of its 6 7/8% Debentures due December 15, 2028, the "Debentures"
and, together with the 2000 Notes, the 2005 Notes and the 2008 Notes, the
"Securities", for an identical principal amount of its outstanding Securities,
the "Restricted Securities".
The Exchange Securities will:
. have the same terms as the Restricted Securities, except the Exchange
Securities will be registered with the Securities and Exchange Commission
and you will be able to offer and sell them freely to any potential buyer.
This is beneficial to you because the Restricted Securities are not
registered and may not be offered or sold unless they are registered or
exempted from registration under federal securities laws.
. bear interest at the interest rates indicated above until the maturity
dates indicated above accruing from December 21, 1998, the issue date of
the Restricted Securities, and provide for payment semi-annually on June 15
and December 15, beginning June 15, 1999.
. not trade on any securities exchange or through any automated quotation
system. No active public market is anticipated.
The exchange offer:
.expires at 5:00 p.m., New York City time, on , 1999, unless
extended.
. is subject to customary terms and conditions, as specified in this
prospectus and the accompanying letter of transmittal.
The 2005 Notes, the 2008 Notes and the Debentures will be redeemable at our
option, in whole or in part from time to time.
See "Risk Factors" beginning on page 2 for a discussion of factors that you
should carefully consider in evaluating an investment in the Securities offered
in this prospectus.
We issued the Restricted Securities in a transaction not requiring
registration under the Securities Act and thus their transfer is restricted. We
are making the exchange offer to satisfy your registration rights, as holders
of the Restricted Securities, requiring us to either provide you with Exchange
Securities registered under the Securities Act or to register your Restricted
Securities for resale. In the event we do not fulfill these obligations, we
must make certain penalty interest payments to you, as described under
"Exchange Offer--Purpose of the Exchange Offer."
You should rely only on the information contained in this prospectus or to
which we have referred you. We have not authorized anyone to provide you with
information that is different. We are not offering to sell or asking you to buy
anything other than the Exchange Securities. We are not offering to sell or
asking you to buy anything in any jurisdiction where doing so would be against
the law.
Neither the Securities and Exchange Commission nor any state securities
commission has approved the Exchange Securities nor determined that this
prospectus is accurate or complete. Any representation to the contrary is a
criminal offence.
, 1999
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
THE COMPANY................................................................ 2
RISK FACTORS............................................................... 2
RECENT DEVELOPMENTS........................................................ 3
AVAILABLE INFORMATION...................................................... 3
USE OF PROCEEDS............................................................ 4
RATIO OF EARNINGS TO FIXED CHARGES......................................... 5
EXCHANGE OFFER............................................................. 5
DESCRIPTION OF THE SECURITIES.............................................. 12
PLAN OF DISTRIBUTION....................................................... 19
LEGAL MATTERS.............................................................. 20
EXPERTS.................................................................... 20
</TABLE>
<PAGE>
THE COMPANY
Rite Aid Corporation, incorporated in 1968, is one of the largest retail
drugstore chains in the United States. As of February 27, 1999, we operated
3,821 drugstores, which range in size from approximately 7,200 to 20,000 square
feet, in 30 eastern, southern and western states and the District of Columbia.
We employ over 75,000 associates.
Pharmacy service forms the core of our business, with prescriptions
accounting for 54.2 percent of sales in the fifty - two week period ended
February 27, 1999. Our drugstores offer a full selection of health and personal
care products, seasonal merchandise and a large private label product line in
convenient locations, and a customer-oriented shopping environment. As of
February 27, 1999, we had over 1,000 stores with drive-through pharmacy windows,
over 260 stores that are open 24 hours per day, and over 1,900 stores with one-
hour photo departments. We have added express mail with complementary services
and one-hour photo departments to attract new customers and enhance customer
loyalty.
Through our Eagle Managed Care Corp. subsidiary and our recently purchased
subsidiary, PCS Health Systems, Inc., one of the largest pharmacy benefit
managers, we are engaged in pharmacy benefit management, marketing prescription
plans and selling other managed health care services to employers, health plans
and their members and government-sponsored employee benefit programs. We
purchased PCS, on January 22, 1999.
On January 7, 1999, we announced an alliance with General Nutrition
Companies, Inc., a leader in the fast-growing vitamin and nutritional
supplement category. Under the agreement, we will open and operate 1,500 GNC
stores-within-a-store in Rite Aid stores across the country. In addition, Rite
Aid and GNC will jointly market a new brand of vitamins and mineral
supplements; GNC will manufacture certain of Rite Aid's private label vitamins
and supplements; and Rite Aid and GNC will jointly operate a co-branded web-
site that will feature nutritional information and market their vitamins and
minerals.
On December 12, 1996, we acquired Thrifty PayLess Holdings, Inc., which was
one of the largest drugstore retailers in the western United States with over
1,000 stores in 10 states. We have renamed the Thrifty PayLess stores "Rite
Aid" and are in the process of remodeling those stores. On August 27, 1997, we
completed the purchases of K&B Incorporated and Harco, Inc. K&B operated 186
stores in Louisiana, Alabama, Mississippi, Texas, Tennessee and Florida, and in
1996 was the 13th largest drugstore chain in the U.S. in terms of sales, with
sales of $580,000,000. Harco operated 146 stores in Alabama, Mississippi and
Florida, and in 1996 was the 17th largest drugstore chain in the U.S. in terms
of sales, with sales of $258,000,000. We have renamed all K&B and Harco stores
"Rite Aid" and have completed the conversion of the systems and processes of
those stores into our systems and processes.
We are a Delaware corporation. Our principal executive offices are located
at 30 Hunter Lane, Camp Hill, Pennsylvania 17011 and our telephone number is
(717) 761-2633.
RISK FACTORS
There is a risk associated with our amortization of the goodwill from our
purchase of PCS Health Systems, Inc. over 40 years.
On January 22, 1999, we purchased PCS Health Systems, Inc., one of the
largest pharmacy benefit managers in the country. Immediately following this
purchase, our balance sheet included an amount designated as "goodwill" that
represents 30% of our total assets and 107% of stockholders' equity.
Approximately 52% or $1,600,000 of this goodwill, resulted from our acquisition
of PCS, and represents the difference between the price we paid for PCS and the
fair value of the tangible and separately measurable intangible net assets of
PCS. U.S. generally accepted accounting principles, or GAAP, require us to
amortize this goodwill and all other intangible assets over the entire period
during which we benefit from these intangible assets. We have determined that
this goodwill will benefit us for no less than 40 years. There is a
2
<PAGE>
risk that this determination will prove to have been incorrect and we will be
amortizing this goodwill over too long a period. If we have done this, our
earnings reports for the periods immediately following the acquisition will be
overstated, and, in later years, we will be burdened with a continuing charge
against earnings without a corresponding benefit to income. If we determine in
a later year that we are no longer receiving the benefit of this goodwill, we
may have to write off the remaining goodwill in that year, resulting in a
reduction in earnings for that fiscal year. We and our independent accountants
have reviewed the anticipated cash flow and all other factors considered when
we determined the cost we were willing to incur to purchase PCS. We concluded
that anticipated future cash flows associated with the intangible assets
acquired when we purchased PCS will continue indefinitely. We have found no
persuasive evidence that we will deplete any material portion of these
intangible assets in less than 40 years. However, we can give no assurance that
this determination will prove to be correct.
RECENT DEVELOPMENTS
On March 12, 1999, we announced that our preliminary estimate for fully
diluted earnings per share for the fourth quarter would be approximately $0.30
to $0.32 as compared to the then existing First Call analysts' consensus
estimates of $0.52 per share. Subsequent to our March 12 announcement, several
purported class action lawsuits were commenced against Rite Aid, Martin Grass,
our Chairman, Chief Executive Officer and a director, Timothy Noonan, our
President, Chief Operating Officer and a director, Franklin Brown, our Vice
Chairman and a director, and Frank Bergonzi, our Senior Executive Vice President
and Chief Financial and Accounting Officer in the United States District Court
for the Eastern District of Pennsylvania. The plaintiffs in these suits allege
that we failed to make prompt public disclosure of matters mentioned in our
March 12 announcement that affected our results for the fourth quarter and seek
to recover damages on behalf of all purchasers of our common stock between
December 14, 1998 and March 11, 1999. On April 8, 1999, the Court approved a
stipulation among counsel that, among other things, provided for consolidation
of these suits. We intend to deny the material allegations in these complaints
and to defend these actions vigorously.
On March 29, 1999, we announced our unaudited financial results for the
fourth quarter and year ended February 27, 1999. For the fourth quarter ended
February 27, 1999, sales increased 11.7 percent to $3,565,300,000 from
$3,190,600,000 for the same period in fiscal 1998. Prescription revenue
accounted for 53.8 percent of drugstore sales for the quarter, and third party
prescription revenues represented 86.1 percent of pharmacy sales. Net income
was $73,000,000, a decrease from $119,700,000 for the same period in fiscal
1998. Diluted earnings per shares decreased to $.28 versus $.44 for the
comparable period of fiscal 1998.
Revenues for the fiscal year ended February 27, 1999, rose 11.9 percent to
$12,731,900,000 from $11,375,100,000 in fiscal 1998. Prescription revenue was
54.2 percent of drugstore sales, and third party prescription revenue accounted
for 85.4 percent of pharmacy sales. We recorded a charge for store closings and
other costs of $289,700,000, $176,900,000 after tax. Net income was
$158,000,000 or $.60 per diluted share, a decrease from $316,400,000 or $1.22
per diluted share for fiscal 1998. Excluding the store closing charge, diluted
earnings per share were $1.27
AVAILABLE INFORMATION
We have filed with the SEC a registration statement under the Securities
Act, relating to the Exchange Securities. As permitted by SEC rules, this
prospectus omits certain information included in the registration statement.
For a more complete understanding of the exchange offer, you should refer to
the registration statement, including its exhibits.
We also file annual, quarterly and special reports, proxy statements and
other information with the SEC. You can read and copy the registration
statement and any other document we file at the SEC's public reference room at
450 Fifth Street, N.W., Washington, D.C. 20549. These documents are also
available at the public reference rooms at the SEC's regional offices in New
York, New York and Chicago, Illinois. You may call the
3
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SEC at 1-800-SEC-0330 for further information on the public reference rooms.
Our SEC filings are also available to the public at the SEC's web site at
http://www.sec.gov. Documents filed by us with the SEC are identifiable by our
commission file number, 1-5742.
The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose information to you by referring you to
those documents. These incorporated documents contain business and financial
information about us that is not included in or delivered with this prospectus.
The information incorporated by reference is part of this prospectus, and later
information filed with the SEC will update and supersede this information. We
incorporate by reference the documents listed below and any future filings made
with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior
to the date the exchange offer expires:
. Annual Report on Form 10-K for the year ended February 28, 1998;
. Quarterly Reports on Form 10-Q for the quarters ended May 30, 1998,
August 29, 1998 and November 28, 1998 and
. Current Reports on Form 8-K dated November 17, 1998, January 19, 1999,
February 9, 1999 and March 17, 1999.
We will provide without charge to each person to whom a copy of this
prospectus has been delivered, on the written or oral request of any such
person, a copy of any or all of the documents referred to above which have been
or may be incorporated into this prospectus by reference. We will also provide
copies of any exhibits to such documents that are specifically incorporated by
reference in such documents. Requests for such copies should be directed to
Investor Relations, Rite Aid Corporation, 30 Hunter Lane, Camp Hill,
Pennsylvania 17011, telephone number (717) 761-2633, Ext. 5362.
USE OF PROCEEDS
We will receive no proceeds from the exchange of Securities.
4
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RATIO OF EARNINGS TO FIXED CHARGES
We have calculated the ratios of earnings to fixed charges in the following
table by dividing earnings by fixed charges. For this purpose, earnings include
pre-tax income from continuing operations plus fixed charges. Fixed charges
include interest, whether expensed or capitalized, amortization of debt expense
and that portion of rental expense which is representative of the interest
factor in these rentals.
<TABLE>
<CAPTION>
Thirty-nine Fiscal Year
Weeks Ended ------------------------
November 28,
1998 1998 1997 1996 1995 1994
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<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges....... 1.57 2.91 2.56 3.08 3.78 1.66
</TABLE>
EXCHANGE OFFER
Purpose of the Exchange Offer
We initially sold the Restricted Securities in a private offering on
December 21, 1998 to J.P. Morgan Securities Inc., Salomon Smith Barney Inc.,
Lehman Brothers Inc., NationsBanc Montgomery Securities LLC, ABN AMRO
Incorporated and First Chicago Capital Markets, Inc. pursuant to a purchase
agreement dated December 16, 1998 between us and them. These "initial
purchasers" of the Restricted Securities resold them to qualified institutional
buyers in reliance on, and subject to the restrictions imposed under, Rule 144A
under the Securities Act and outside the United States in accordance with the
provisions of Regulation S under the Securities Act.
In connection with the private offering of the Restricted Securities, we
entered into an exchange and registration rights agreement dated December 21,
1998, with the initial purchasers, in which we agreed, among other things:
. to file with the SEC on or before March 21, 1999, a registration
statement relating to an exchange offer for the Restricted Securities;
. to use our reasonable best efforts to cause such exchange offer
registration statement to be declared effective under the Securities Act
on or before June 19, 1999;
. upon the effectiveness of the registration statement, to offer the
holders of the Restricted Securities the opportunity to exchange their
Restricted Securities for a like principal amount of Exchange Securities;
. to keep the exchange offer open for not less than 30 days, or longer, if
required by applicable law, after notice of the exchange offer is mailed
to holders of Restricted Securities; and
. to use our reasonable best efforts to complete the exchange offer on or
before July 19, 1999.
We are making the exchange offer to satisfy your registration rights under
the exchange and registration rights agreement. If we fail to fulfill such
obligations, we must pay you, as a holder of outstanding Restricted Securities,
penalty interest at a rate of 0.50% per annum, determined daily.
We strongly encourage you to read the entire text of the exchange and
registration rights agreement, which is included as Exhibit 4.2 to the exchange
offer registration statement. We expressly qualify all discussion of the
exchange and registration rights agreement by the terms of the agreement
itself.
Effect of the Exchange Offer
Based on several no-action letters issued by the staff of the SEC to third
parties in unrelated transactions, we believe that you may offer for resale,
resell or otherwise transfer any Exchange Securities issued to you in
5
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the exchange offer without registration of your Exchange Securities or of a
prospectus, if
. you are acquiring the Exchange Securities in the ordinary course of your
business;
. you are not participating, do not intend to participate and have no
arrangement or understanding with any person to participate, in a
distribution of the Exchange Securities;
. you are not an affiliate of Rite Aid as defined in Rule 405 under the
Securities Act; and
. you are not a broker-dealer who acquired Restricted Securities as a
result of market-making activities or other trading activities.
If you are an affiliate of Rite Aid or an initial purchaser, or if you have
any arrangement or understanding with any person to participate in a
distribution of the Exchange Securities:
. you will not be able to rely on the interpretations of the staff of the
SEC in connection with any offer for resale, resale or other transfer of
Exchange Securities; and
. you must comply with the registration and prospectus delivery
requirements of the Securities Act, or have an exemption available to
you, in connection with any offer for resale, resale or other transfer of
the Exchange Securities.
Each broker-dealer that receives Exchange Securities for its own account in
exchange for Restricted Securities it acquired as a result of market-making
activities or other trading activities, must acknowledge that it will deliver a
prospectus in connection with any resale of its Exchange Securities. This will
not be an admission by the broker-dealer that it is an underwriter within the
meaning of the Securities Act. See "Plan of Distribution."
Terms of the Exchange Offer
. We will accept all Restricted Securities validly tendered and not
withdrawn prior to 5:00 p.m., New York City time, on the expiration date
of the exchange offer. You should read "--Expiration Date; Extensions;
Amendments" below for an explanation of how the expiration date may be
amended.
. We will issue and deliver $1,000 principal amount of Exchange Securities
in exchange for each $1,000 principal amount of outstanding Restricted
Securities accepted in the exchange offer. Holders may exchange some or
all of their Restricted Securities in denominations of $1,000 and
integral multiples of $1,000.
. By tendering Restricted Securities in exchange for Exchange Securities
and by signing the letter of transmittal, you will be representing that,
among other things:
. any Exchange Securities to be received by you will be acquired in the
ordinary course of your business;
. you have no arrangement or understanding with any person to
participate in the distribution of the Exchange Securities; and
. you are not an affiliate, as defined in Rule 405 under the Securities
Act, of Rite Aid, or, if you are an affiliate, you will comply with
the registration and prospectus delivery requirements of the
Securities Act to the extent applicable.
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. We are sending this prospectus and the letter of transmittal to all
registered holders of Restricted Securities as of the close of business
on , 1999.
. We are not conditioning the exchange offer upon the tender of any minimum
amount of Restricted Securities.
. We have provided for customary conditions, which we may waive in our
discretion. See "--Conditions to the Exchange Offer."
. We may accept tendered Restricted Securities by giving oral or written
notice to the exchange agent. The exchange agent will act as your agent
for the purpose of receiving the Exchange Securities from us and
delivering them to you.
. You will not be required to pay brokerage commissions or fees or, subject
to the instructions in the letter of transmittal, transfer taxes with
respect to the exchange of Restricted Securities We will pay all charges
and expenses in connection with the exchange offer other than taxes
specified under "--Fees and Expenses."
Expiration Date; Extensions; Amendments
The exchange offer will expire at 5:00 p.m., New York City time, on ,
1999, unless we, in our sole discretion, extend it. We may extend the exchange
offer at any time and from time to time by giving oral or written notice to the
exchange agent and by timely public announcement. We may also accept all
properly tendered Restricted Securities as of the expiration date and extend
the expiration date in respect of the remaining outstanding Restricted
Securities.
We may, in our sole discretion,
. amend the terms of the exchange offer in any manner;
. delay acceptance of, or refuse to accept, any Restricted Securities
not previously accepted;
. extend the exchange offer; or
. terminate the exchange offer.
We will give prompt notice of any amendment to the registered holders of the
Restricted Securities. If we materially amend the exchange offer, we will
promptly disclose the amendment in a manner reasonably calculated to inform you
of the amendment and we will extend the exchange offer to the extent required
by law.
Procedures for Tendering
Only a holder of Restricted Securities may tender them in the exchange
offer. To tender in the exchange offer, you must:
. complete, sign and date the letter of transmittal or a facsimile of
it;
. have the signatures on the letter of transmittal guaranteed if
required by the letter of transmittal; and
. mail or deliver an original or facsimile of the letter of transmittal
and any other required documents, to the exchange agent before 5:00
p.m., New York City time, on the expiration date.
Prior to the expiration date, the exchange agent must receive a timely
confirmation of a book-entry transfer of tendered Restricted Securities into
its account at the Depository Trust Company, "DTC", as required by the
procedures for book-entry transfer as provided for in this prospectus and in
the letter of transmittal, or the holder must comply with the guaranteed
delivery procedures described below under "--Guaranteed Delivery Procedures."
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Any financial institution that is a participant in DTC's system may make
book-entry delivery of the Restricted Securities by causing DTC to transfer the
Restricted Securities into the exchange agent's account in accordance with
DTC's procedures. Although book-entry transfer into the exchange agent's
account at DTC will effect delivery of Restricted Securities, you must deliver
an original or facsimile of the letter of transmittal, with any required
signature guarantees and any other required documents, to the exchange agent at
its address set forth under "--Exchange Agent" before 5:00 p.m., New York City
time, on the expiration date.
Delivery of documents to DTC in accordance with DTC's procedures does NOT
constitute delivery to the exchange agent.
The tender by a holder of Restricted Securities will constitute an agreement
between the holder, Rite Aid and the exchange agent in accordance with the
terms and subject to the conditions specified in this prospectus and in the
letter of transmittal. If a holder tenders less than all the Restricted
Securities held, the holder should fill in the amount of Restricted Securities
being tendered in the appropriate box on the letter of transmittal. The
exchange agent will deem the entire amount of Restricted Securities delivered
to it to have been tendered unless the holder has indicated otherwise.
The method of delivery of the letter of transmittal and all other required
documents to the exchange agent is at your election and risk. Instead of
delivery by mail, we recommend that you use an overnight or hand delivery
service. In all cases, you should allow sufficient time to ensure delivery to
the exchange agent prior to the expiration date. Do not send your letter of
transmittal or other required documents to us.
Signature Requirements and Signature Guarantee
You must arrange for an "eligible institution" to guarantee the signatures
on a letter of transmittal or a notice of withdrawal. The following are
"eligible institutions":
. a member firm of a registered national securities exchange or of the
National Association of Securities Dealers, Inc.,
. a commercial bank or trust company having an office or correspondent in
the United States or
. an "eligible guarantor institution" within the meaning of Rule 17Ad-15
under the Exchange Act.
A signature guarantee is not required with respect to Restricted Securities
tendered for the account of an eligible institution.
If trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, sign or endorse any required documents, they should indicate the
capacity in which they are signing when signing, and unless waived by us,
submit evidence satisfactory to us of their authority to act as fiduciary or
representative with the letter of transmittal.
Conditions of the Exchange Offer
We will determine all questions as to the validity, form, eligibility,
including time of receipt, acceptance and withdrawal of the tendered Restricted
Securities in our sole discretion. Our determination will be final and binding.
We may reject any and all Restricted Securities which are not properly tendered
or any Restricted Securities of which our acceptance would, in the opinion of
our counsel, be unlawful. We also may waive any irregularities or conditions of
tender as to particular Restricted Securities. Our interpretation of the terms
and conditions of the exchange offer, including the instructions in the letter
of transmittal, will be final and binding on all parties. Unless waived, you
must cure any defects or irregularities in connection with tenders of
Restricted Securities within the time we determine.
8
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Although we intend to notify tendering holders of defects or irregularities
with respect to tenders of Restricted Securities, neither we nor anyone else
has any duty to notify these holders. Neither we nor anyone else shall incur
any liability for failure to give this notification. Your Restricted Securities
will not be deemed tendered until you have cured, or we have waived, any
irregularities. As soon as practicable following the expiration date the
exchange agent will return any Restricted Securities that we reject due to
improper tender or otherwise unless you cure all defects or irregularities or
we waive them.
We reserve the right in our sole discretion:
. to purchase or make offers for any Restricted Securities that remain
outstanding subsequent to the expiration date;
. to terminate the exchange offer, as set forth in "--Conditions to the
Exchange Offer"; and
. to the extent permitted by applicable law, to purchase Restricted
Securities in the open market, in privately negotiated transactions or
otherwise.
The terms of purchases or offers by us may differ from the terms of the
exchange offer.
We will not be required to accept for exchange, or to issue Exchange
Securities for, any Restricted Securities, and we may terminate or amend the
exchange offer before the acceptance of Restricted Securities if, in our
judgment, any of the following conditions has occurred or exists or has not
been satisfied:
. the exchange offer, or the making of any exchange by a holder of
Restricted Securities, violates applicable interpretations of the SEC
staff;
. any person shall have initiated or threatened an action or proceeding in
any court or by or before any governmental agency or body with respect to
the exchange offer; or
. any legislative or regulatory body shall have adopted or enacted any law,
statute, rule or regulation that can reasonably be expected to impair our
ability to proceed with the exchange offer.
If we determine that we may terminate the exchange offer for any of these
reasons, we may:
. refuse to accept any Restricted Securities and return any Restricted
Securities that have been tendered to the tendering holders,
. extend the exchange offer and retain all Restricted Securities tendered
prior to the expiration date of the exchange offer, subject to the rights
of the holders of the tendered Restricted Securities to withdraw their
Restricted Securities, or
. waive the termination event with respect to the exchange offer and accept
the properly tendered Restricted Securities that have not been withdrawn.
If we determine that the waiver constitutes a material change in the exchange
offer, we will promptly disclose the change in a manner reasonably calculated
to inform the holders of the change and we will extend the exchange offer to
the extent required by law.
We may assert or waive any of these conditions in our complete discretion.
Book-Entry Transfer
The exchange agent will make a request promptly after the date of this
prospectus to establish accounts with respect to the Restricted Securities.
Subject to the establishment of these accounts, any financial institution that
is a participant in DTC's system may make book-entry delivery of Restricted
Securities by causing DTC to transfer them into the exchange agent's account
with respect to the Restricted Securities. Each institution must do this in
accordance with DTC's Automated Tender Offer Program procedures for book-entry
transfer. However, the exchange agent will only exchange the tendered
Restricted Securities after a timely confirmation of their book-entry transfer
into the exchange agent's account, and timely receipt of an Agent's Message and
any other documents required by the letter of transmittal.
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<PAGE>
The term "Agent's Message" means a message, transmitted by DTC and received
by the exchange agent and forming part of the confirmation of a book-entry
transfer, which states that
. DTC has received an express acknowledgment from a participant tendering
Restricted Securities the participant has received the letter of
transmittal and agrees to be bound by its terms, and
. Rite Aid may enforce the agreement against the participant.
Although you may effect delivery of Restricted Securities through DTC into
the exchange agent's account at DTC, you must provide the exchange agent a
completed and executed letter of transmittal with any required signature
guarantee and all other required documents prior to the expiration date. If you
comply with the guaranteed delivery procedures described below, you must
provide the letter of transmittal to the exchange agent within the time period
provided. Delivery of documents to DTC without confirmation or compliance does
not constitute delivery to the exchange agent.
Guaranteed Delivery Procedures
If you wish to tender your Restricted Securities and (1) cannot deliver the
letter of transmittal or any other required documents to the exchange agent
prior to the expiration date or (2) cannot complete the procedure for book-
entry transfer on a timely basis, you may instead effect a tender if:
. you make the tender through an eligible institution;
. prior to the expiration date, the exchange agent receives from the
eligible institution (1) an original or facsimile or the properly
completed and duly executed letter of transmittal and (2) notice of
guaranteed delivery, by facsimile transmittal, mail or hand delivery,
specifying the name and address of the holder and the principal amount of
the Restricted Securities tendered, stating that the tender is being
made, and guaranteeing that, within three New York Stock Exchange trading
days after the date of execution of the notice of guaranteed delivery, a
confirmation of a book-entry transfer into the exchange agent's account
at DTC and any other documents required by the letter of transmittal,
will be deposited by the eligible institution with the exchange agent;
and
. the exchange agent receives confirmation of a book-entry transfer into
its account at DTC and all other documents required by the letter of
transmittal within three New York Stock Exchange trading days after the
date of execution of the notice of guaranteed delivery.
The exchange agent will provide you a form of notice of guaranteed delivery
upon request.
Withdrawal of Tenders
Except as otherwise provided in this prospectus, you may withdraw tendered
Restricted Securities at any time before 5:00 p.m., New York City time, on the
expiration date.
To do so, you must provide the exchange agent with a written or facsimile
transmission notice of withdrawal before 5:00 p.m., New York City time, on the
expiration date.
Any notice of withdrawal must
. identify the Restricted Securities to be withdrawn, including the
principal amount of the Restricted Securities and the name and number of
the account at DTC to be credited; and
. be signed by you in the same manner as the original signature on your
letter of transmittal, including any required signature guarantee, or be
accompanied by documents of transfer sufficient to permit the registrar
to register the transfer of the withdrawn Restricted Securities into your
name.
We will determine all questions as to the validity, form and eligibility,
including time of receipt, of all withdrawal notices. Our determination shall
be final and binding on all parties. We will not deem any properly withdrawn
Restricted Securities to be validly tendered for purposes of the exchange offer
and will not issue Exchange Securities with respect to them unless the holder
of the properly withdrawn Restricted Securities validly retenders them. You may
retender withdrawn Restricted Securities by following one of the procedures
described above under "--Procedures for Tendering" at any time prior to the
expiration date.
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<PAGE>
Exchange Agent
We have appointed Harris Trust and Savings Bank, which also acts as the
trustee under the indenture, as exchange agent for the exchange offer. In this
capacity, the exchange agent has no fiduciary duties and will be acting solely
on the basis of our directions. You should direct all communications with the
exchange agent, including requests for assistance or for additional copies of
this prospectus or of the letter of transmittal as follows:
Facsimile Transmission By Hand/Overnight By Registered or
Number: Delivery: Certified Mail:
Harris Trust and Savings Harris Trust and Savings
Bank Bank
(For Eligible c/o Harris Trust Company c/o Harris Trust Company
Institutions Only) of New York of New York
(212) 701-7636 88 Pine Street P.O. Box 1010
19th Floor Wall Street Station
New York, NY 10005 New York, NY 10268-1010
For General Information and to Confirm Receipt of Facsimile by Telephone:
(212) 701-7624
Delivery to an address or facsimile number other than those listed above
will not constitute a valid delivery.
Fees and Expenses
We will bear all expenses of the exchange offer. We are making the principal
solicitation regarding the exchange offer by mail. Our officers and regular
employees and our affiliates may also make solicitations in person, by
telegraph, telephone or facsimile transmission.
We have not retained any dealer-manager in connection with the exchange
offer and will not make any payments to brokers, dealers or other persons
soliciting acceptances of the exchange offer. We will, however, pay the
exchange agent reasonable and customary fees for its services and will
reimburse its reasonable out-of-pocket costs and expenses and will indemnify
the exchange agent for all losses and claims incurred by it as a result of the
exchange offer. We may also pay brokerage houses and other custodians, nominees
and fiduciaries the reasonable out-of-pocket expenses incurred by them in
forwarding copies of this prospectus, letters of transmittal and related
documents to the beneficial owners of the Restricted Securities and in handling
or forwarding tenders for exchange.
Transfer Taxes
We will pay any transfer taxes applicable to the exchange of Restricted
Securities in response to the exchange offer. If, however, a transfer tax is
imposed for any reason other than the exchange of Restricted Securities in
response to the exchange offer, then the amount of any these transfer taxes,
whether imposed on the registered holder of the Securities or any other person,
will be payable by the tendering holder. For example, the tendering holder will
pay transfer taxes, if:
. Exchange Securities for principal amounts not tendered, or accepted for
exchange are to be registered or issued in the name of any person other
than the registered holder of the Restricted Securities tendered; or
. tendered Restricted Securities are registered in the name of any person
other than the person signing the letter of transmittal.
If you do not submit satisfactory evidence of payment of taxes for which you
are liable or exemption from them with your letter of transmittal, we will bill
you for the amount of these transfer taxes directly.
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<PAGE>
Accounting Treatment
We will record the Exchange Securities at the same carrying value as the
Restricted Securities, which is the principal amount as reflected in our
accounting records on the date of the exchange. Accordingly, we will not
recognize any gain or loss for accounting purposes. We will capitalize the
expenses of the exchange offer for accounting purposes. We will classify these
expenses as prepaid expenses and include them in other assets on our balance
sheet. We will amortize these expenses over the period until
. December 15, 2000 with respect to the 2000 Notes;
. December 15, 2005 with respect to the 2005 Notes;
. December 15, 2008 with respect to the 2008 Notes and
. December 15, 2028 with respect to the 2028 Notes.
Consequences of a Failure to Exchange Restricted Securities
Holders of Restricted Securities who do not tender them in the exchange
offer will continue to hold their Restricted Securities and will be entitled to
all the rights, under the indenture. By making the exchange offer, we will
satisfy our obligation to provide you with Exchange Securities and register
your Restricted Securities for resale.
All untendered Restricted Securities will continue to be subject to the
restrictions on transfer set forth in the indenture. Accordingly, after the
completion of the exchange offer, you will only be able to offer for sale, sell
or otherwise transfer untendered Restricted Securities as follows:
. to us;
. in connection with a registration statement that has been declared
effective under the Securities Act;
. for so long as the Restricted Securities are eligible for resale under
Rule 144A under the Securities Act, to a person you reasonably believe is
a qualified institutional buyer within the meaning of Rule 144A, that
purchases for its own account or for the account of a qualified
institutional buyer to whom notice is given that the transfer is being
made in reliance on the exemption from the registration requirements of
the Securities Act provided by Rule 144A;
. in connection with offers and sales that occur outside the United States
to foreign persons in transactions complying with the provisions of
Regulation S under the Securities Act; or
. under any other available exemption from the registration requirements of
the Securities Act.
The tender and acceptance in the exchange offer of Restricted Securities
could adversely affect the liquidity of the trading market for any untendered
Restricted Securities.
DESCRIPTION OF THE SECURITIES
The form and terms of the Exchange Securities are the same as the form and
terms of the Restricted Securities except that the Exchange Securities will
have been registered under the Securities Act and thus will not bear legends
restricting their transfer as required by the Securities Act. The Restricted
Securities have been, and the Exchange Securities are to be, issued under an
indenture, dated as of December 21, 1998, between Rite Aid and Harris Trust and
Savings Bank, as trustee.
<TABLE>
<CAPTION>
2000 Notes 2005 Notes 2008 Notes 2028 Debentures
- ------------------------- ------------------------- ------------------------- -------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Principal $200,000,000 Principal $200,000,000 Principal $150,000,000 Principal $150,000,000
amount being amount being amount being amount being
offered offered offered offered
Maturity December 15, Maturity December 15, Maturity December 15, Maturity December 15,
Date: 2000 Date: 2005 Date: 2008 Date: 2028
Interest 5 1/2% Interest 6% Interest 6 1/8% Interest 6 7/8%
Rate: Rate: Rate: Rate:
Interest June 15 and Interest June 15 and Interest June 15 and Interest June 15 and
payment December 15 payment December 15 payment December 15 payment December 15
dates: dates: dates: dates:
</TABLE>
12
<PAGE>
The Securities are limited to $700,000,000 in aggregate principal amount.
The Restricted Securities are, and the Exchange Securities will be, unsecured
obligations of Rite Aid and will rank equally with all our other unsecured and
unsubordinated obligations. We will issue the Exchange Securities only in fully
registered form, without coupons, in denominations of $1,000 or any integral
multiple of $1,000.
Each of the Exchange Securities will bear interest from the last payment
date on which interest was paid on the Restricted Securities surrendered in
exchange for the relevant Exchange Securities. If we have paid no interest on
the Restricted Securities, the Exchange Securities will bear interest from
December 21, 1998. We will pay interest to the persons in whose name the
Exchange Securities are registered on the applicable record date, which is the
fifteenth calendar day immediately preceding the related Interest Payment Date.
We will issue the Exchange Securities in the form of one or more registered
global securities. These will be deposited with, or on behalf of, DTC and
registered in the name of DTC or its nominee. See "--Book-Entry System."
We have the right to redeem the Securities
We may redeem the 2005 Notes, the 2008 Notes and the Debentures at our
option, in whole at any time or in part from time to time, at a redemption
price equal to the greater of
. 100% of the principal amount of the Securities to be redeemed or
. the sum of the present values of the remaining scheduled payments of
principal and interest from the redemption date to the stated maturity
date of the Securities discounted to the redemption date on a semiannual
basis, assuming a 360-day year consisting of twelve 30-day months, at the
Treasury Rate, as defined below, plus 20 basis points, in the case of the
2005 Notes or 2008 Notes, or 25 basis points in the case of the
Debentures,
. plus, in each case, accrued and unpaid interest on the Securities to but
excluding the redemption date.
We will mail notice of any redemption at least 30 days, but not more than 90
days, before the redemption date to each holder of the Securities to be
redeemed. Unless we default in payment of the redemption price, on and after
the redemption date, interest will cease to accrue on the Securities or
portions of the Securities called in connection with the redemption.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Quotation Agent as having a maturity comparable to the
remaining life that would be utilized, at the time of selection and in
accordance with customary practice, in pricing new issues of corporate debt
securities of comparable maturity with the remaining life of the Securities to
be redeemed.
"Comparable Treasury Price" means, with respect to any redemption date, the
average of five Reference Treasury Dealer Quotations for the relevant
redemption date, after excluding the highest and lowest of these Reference
Treasury Dealer Quotations, or if the Trustee obtains fewer than three
Reference Treasury Dealer Quotations, the average of all quotations obtained.
"Quotation Agent" means the Reference Treasury Dealer appointed by the
Company.
"Reference Treasury Dealer" means each of J.P. Morgan Securities Inc.,
Salomon Smith Barney Inc., Lehman Brothers Inc., NationsBanc Montgomery
Securities LLC, ABN AMRO Incorporated and First Chicago Capital Markets, Inc.,
and their respective successors; provided, however, that if any of the
foregoing shall cease to be primary U.S. Government securities dealers in New
York City, a "Primary Treasury Dealer", the Company shall substitute therefor
another Primary Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any redemption date, the average, as determined by the
Trustee, of the bid and asked prices for the Comparable
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<PAGE>
Treasury Issue, expressed in each case as a percentage of its principal amount,
quoted in writing to the Trustee by the relevant Reference Treasury Dealer by
5:00 p.m., New York City time, on the third Business Day preceding the
redemption date.
"Treasury Rate" means, with respect to any redemption date, the rate per
annum equal to the semi-annual yield to maturity of the Comparable Treasury
Issue, calculated on the third Business Day preceding the redemption date using
a price for the Comparable Treasury Issue, expressed as a percentage of its
principal amount, equal to the Comparable Treasury Price for the redemption
date.
Covenants Applicable to Securities
The indenture does not prohibit us from entering into transactions that may
adversely affect you
The indenture does not contain any provisions that permit you to require
prepayment in the event of a change in the management or control of Rite Aid.
It does not afford you protection in the event of a highly leveraged
transaction, reorganization, restructuring, merger or similar transaction
involving Rite Aid that may adversely affect you, except to the limited extent
that the covenants described below might affect our ability to consummate these
transactions.
The various restrictive provisions of the indenture apply to Rite Aid and to
what the indenture defines as our "Restricted Subsidiaries" but do not apply to
what the indenture defines as our "Unrestricted Subsidiaries". In this section,
we use the terms "we" and "us" to mean Rite Aid and our Restricted
Subsidiaries.
"Unrestricted Subsidiaries" are those Subsidiaries which are designated as
Unrestricted Subsidiaries by our Board of Directors from time to time pursuant
to the indenture, unless and until designated as Restricted Subsidiaries by the
Board of Directors under the indenture.
"Restricted Subsidiaries" are all Subsidiaries other than Unrestricted
Subsidiaries.
A "Wholly-owned Restricted Subsidiary" is a Restricted Subsidiary at least
99% of the outstanding voting stock of which, except directors' qualifying
shares, is owned by us.
A "Subsidiary" is a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by us or an entity other than
a corporation of which we have, directly or indirectly, the majority ownership
and the power to direct the management. (Section 1.01)
We may not designate an Unrestricted Subsidiary a Restricted Subsidiary if
it has any debt we would not be permitted to incur under the terms of the
indenture, immediately after the Unrestricted Subsidiary becomes a Restricted
Subsidiary. (Section 10.11(a))
The indenture limits our right to incur Secured Debt
We may not incur or guarantee indebtedness secured by any lien, mortgage,
pledge or other encumbrance on our property without equally and ratably
securing the securities. This restriction does not apply to permitted
encumbrances described in the indenture, including:
. purchase money mortgage encumbrances existing on property at the time we
acquire it,
. conditional sales and similar agreements,
.the extension, renewal or refunding of any of the foregoing, and
. any Secured Debt of a Restricted Subsidiary owing to Rite Aid or a
Wholly-owned Restricted Subsidiary.
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<PAGE>
. other indebtedness secured by encumbrances not otherwise specifically
permitted which, together with Attributable Debt respecting existing
Sale and Leaseback Transactions, excluding Sale and Leaseback
Transactions entered into in respect of property we acquired not more
than 24 months prior to the date the Sale and Leaseback Transaction is
entered into, and unsecured Funded Debt of Restricted Subsidiaries,
excluding unsecured Funded Debt incurred through extension, refund or
renewal where Consolidated Funded Debt was not thereby increased and
excluding any Funded Debt owed to Rite Aid or a Wholly-owned Restricted
Subsidiary, incurred or entered into, as the case may be, after the date
of the indenture, would not at the time exceed 20% of the Consolidated
Net Tangible Assets of Rite Aid and its Restricted Subsidiaries.
(Section 10.10)
Under the indenture (Section 1.01):
. ""Consolidated Net Tangible Assets" means the total amount of assets on
our consolidated balance sheet less applicable reserves and other
properly deductible items and after excluding any investments made in
Unrestricted Subsidiaries or in corporations while they were
Unrestricted Subsidiaries but which are not Subsidiaries at the time of
computation after deducting (a) all liabilities and liability items,
including amounts in respect of obligations under leases, or guarantees
of leases, which under generally accepted accounting principles would be
included on the balance sheet, except Funded Debt, capital stock and
surplus, surplus reserves and provisions for deferred income taxes and
(b) goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangibles;
. ""Funded Debt" means any indebtedness for money borrowed, created,
issued, incurred, assumed or guaranteed, whether secured or unsecured,
maturing more than one year after its date of determination and any
indebtedness, regardless of its term, renewable according to its terms or
of a revolving credit or similar agreement effective for more than one
year after the date of the creation of the indebtedness, which would, in
accordance with generally accepted accounting practice, be classified as
funded debt, excluding (a) indebtedness for which money in satisfaction
of the indebtedness has been deposited in trust, (b) certain guarantees
arising in the ordinary course of business and (c) liabilities resulting
from capitalization of lease rentals;
. ""Secured Debt" means indebtedness for money borrowed which is secured by
a lien or other encumbrance on our property, excluding certain guarantees
arising in the ordinary course of business; and
. ""Attributable Debt" means as to any Sale and Leaseback Transaction, in
the case of a capital lease, the amount of the capital lease obligation
thereunder and in all other cases, the present value of the minimum
remaining rental obligation discounted at the interest factor included in
the rental payment.
The indenture limits our right to make sales with leases back
We may not sell or transfer, except to Rite Aid or one or more Wholly-owned
Restricted Subsidiaries, any manufacturing plant, warehouse, retail store or
equipment owned and operated by us on or after the date of the indenture with
the intention that we take back a lease on it, except a lease for a period,
including renewals, of not more than 24 months by the end of which period it is
intended that the use of the property by the lessee will be discontinued, any
such transaction, a "Sale and Leaseback Transaction", except:
. where we would be entitled under Section 10.10(d) of the indenture to
incur additional secured indebtedness not otherwise specifically
permitted by the indenture in an amount equal to the Attributable Debt
respecting such Sale and Leaseback Transaction,
. where the Sale and Leaseback Transaction is entered into in respect of
property acquired by us within 24 months of its acquisition or
15
<PAGE>
. where, within 120 days of entering into the Sale and Leaseback
Transaction, we apply to the retirement of its Secured Debt an amount
equal to the greater of:
. the net proceeds of the sale of the property leased in the
transaction or
. the fair market value of the property leased.
The indenture limits the right of Restricted Subsidiaries to incur Funded Debt
The indenture prohibits our Restricted Subsidiaries from becoming liable for
any unsecured Funded Debt except where we would be entitled under Section
10.10(d) of the indenture to incur additional secured indebtedness not
otherwise specifically permitted by the indenture in an amount equal to such
Funded Debt and except for certain extensions, refundings and renewals of
Funded Debt and Funded Debt owing to Rite Aid or a Wholly-owned Restricted
Subsidiary. (Section 10.08)
The indenture limits our rights to merge or sell our assets
We may not merge with, or sell our property substantially as an entirety to
any other corporation if, as a result, our properties or assets would become
subject to a mortgage, lien or other encumbrance which would not be permitted
by the indenture, unless the Securities are equally and ratably secured with
these obligations. Any successor entity must be a corporation organized in the
United States and assume the payment of the principal and interest on the
Securities and the performance of every covenant under the indenture.
Immediately after giving effect to a merger or a consolidation, no event of
default, and no event which, after notice or lapse of time or both, would
become an event of default, shall have happened and be continuing. (Section
8.01)
Although the amount of our property that will constitute a sale of the
property "substantially as an entirety" is not readily quantifiable, a
determination as to whether such a sale has occurred will depend on the
percentage of operating and total assets transferred, among other measurements,
and other facts and circumstances of the transaction. In any particular
transaction, the determination of whether a sale of the property "substantially
as an entirety" has occurred will be made by us, and we will give notice of the
occurrence to the holders of the securities. Because of the uncertainty
regarding whether a particular sale will constitute a sale of property
"substantially as an entirety," holders will not be able to determine for
themselves whether such a transaction has occurred and will have to rely on our
determination. If such a transaction occurs, the person to whom the "entire"
amount of our property is transferred shall enter into a supplemental indenture
satisfactory in form to the trustee.
Your consent is required for modification of the indenture
We can generally only modify the indenture and the rights of the holders
with the consent of the holders of not less than a majority in aggregate
principal amount of the outstanding securities. However, no modification
altering the terms of payment of principal or interest, changing the place or
medium of payment of principal or interest, impairing the rights of holders to
institute suit for payment or reducing the percentage required for modification
will be effective against any holder without his, her or its consent. (Section
9.02)
Events of Default
Each of the following is an event of default under the indenture:
. any default in any payment of principal of, or premium, if any, upon any
securities when due;
. any default for 30 days in any payment of interest on any securities when
due;
. any default in the performance of the covenant restricting merger and
sale of assets;
. any default for 60 days after appropriate notice in the performance of
any other covenant in the indenture;
16
<PAGE>
. certain events of default resulting in the acceleration of the maturity
of indebtedness aggregating in excess of $10,000,000 under any mortgages,
indentures or instruments under which we may have issued, or by which
there may have been secured or evidenced, any other of our indebtedness;
or
. certain events in bankruptcy, insolvency or reorganization.
If an event of default shall occur and be continuing, the trustee or the
holders of not less than 25% in aggregate principal amount of the securities
then outstanding may declare the principal of the securities and any and all
accrued interest to be due and payable.
The holders of a majority in aggregate principal amount of the securities
then outstanding may waive any event of default with respect to the securities
which has been cured. (Sections 5.01, 5.02 and 5.13)
We will file annually with the trustee a written statement signed by an
officer as to the absence of certain defaults under the terms of the indenture.
The indenture provides that the trustee may withhold notice to the holders of
any default (except in payment of principal or premium, if any, or interest) if
it considers it in the interest of the holders to do so. (Sections 6.02 and
10.13)
Subject to the provisions of the indenture relating to the duties of the
trustee, if an event of default shall occur and be continuing, the indenture
provides that the trustee shall be under no obligation to exercise any of its
rights or powers under the indenture at the request, order or direction of
holders unless the holders shall have offered to the trustee reasonable
indemnity. Subject to these provisions for indemnification and certain other
rights of the trustee, the indenture provides that the holders of a majority in
principal amount of the securities then outstanding shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the trustee or exercising any trust or power conferred on the
trustee. (Sections 5.12 and 6.03)
We may discharge our obligations under the indenture
The indenture provides us with the option to discharge any and all
obligations, except for certain obligations to register the transfer or
exchange of securities, to replace stolen, lost or mutilated securities, to
maintain paying agencies and hold moneys for payment in trust, by depositing
with the trustee, in trust, money or U.S. government obligations, or both,
which through the payment of interest and principal on the deposits in
accordance with their terms will provide money in an amount sufficient to pay
any installment of principal and premium, if any, and interest on the relevant
securities in accordance with the terms of the indenture and the relevant
securities. We may only exercise this option:
. if we have received from, or there has been published by, the United
States IRS a ruling to the effect that such a discharge will not be
deemed, or result in, a taxable event with respect to holders of
securities,
. there is no event of default or event which may become an event of
default then occurring and
. our action would not cause any outstanding securities to become delisted.
(Article 12)
The indenture also provides us with the option to have the occurrence of
events described in the fifth bullet point under the heading "--Events of
Default" above no longer be events of default and to omit to comply with
certain of the covenants described under the heading "--Covenants Applicable to
Securities." above. In order to exercise such option:
. we must deposit with the trustee money or U.S. government obligations, or
both, which through the payment of interest and principal in accordance
with their terms will provide money in an amount sufficient to pay
principal and premium, if any, and interest on such securities in
accordance with the terms of the indenture and the securities.
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<PAGE>
. no event of default or event which may become an event of default may
have occurred and be continuing on the date of deposit with the trustee,
and
. we must deliver to the trustee an opinion of counsel to the effect that
the deposit and related option not to comply with certain covenants will
not cause the holders of the securities to recognize income, gain or loss
for federal income tax purposes. (Article 12)
If we exercise the defeasance option, payment of the securities may not be
accelerated
We may exercise the defeasance option notwithstanding our prior exercise of
the covenant defeasance option. If we exercise the defeasance option, payment
of the securities may not be accelerated because of an event of default. If we
exercise the covenant defeasance option, payment of the securities may not be
accelerated by reference to the provisions described in the preceding
paragraph. In the event we omit to comply with our remaining obligations with
respect to the securities under the indenture after exercising the covenant
defeasance option and the securities are declared due and payable because of
the occurrence of any event of default, the amount of money and U.S. government
obligations on deposit with the trustee could be insufficient to pay amounts
due on the securities at the time of the acceleration resulting from an event
of default. However, we will remain liable in respect of these payments.
(Article 12)
Book-Entry System
We will issue the Exchange Securities in the form of one or more fully
registered global securities that we will deposit with, or on behalf of, DTC
and register in the name of DTC's nominee. See "--General."
DTC is a limited-purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
holds securities that its "participants" deposit with DTC. DTC also facilitates
the settlement among participants of securities transactions, such as transfers
and pledges, in deposited securities through electronic computerized book-entry
changes to participants' accounts, thereby eliminating the need for physical
movement of securities certificates. DTC participants include securities
brokers and dealers, banks, trust companies, clearing corporations and certain
other organizations. A number of these "direct participants" and the New York
Stock Exchange, Inc., the American Stock Exchange, Inc. and the National
Association of Securities Dealers, Inc. own DTC. Access to the DTC System is
also available to others such as securities brokers and dealers, banks and
trust companies that clear through or maintain a custodial relationship with a
direct participant, either directly or indirectly, including Euroclear and
Cedel Bank. The rules applicable to DTC and its participants are on file with
the SEC.
We will make payments of principal of, premium, if any, and interest on the
securities to Cede & Co., as nominee of DTC. DTC's practice is to credit direct
participants' accounts on the related payment date in accordance with their
respective holdings shown on DTC's records. DTC will credit payments of
interest on, premium, if any and principal of the securities held through
Euroclear or Cedel Bank to the cash accounts of their respective participants
in accordance with the relevant system's rules and procedures. Standing
instructions and customary practices will govern payments by participants to
beneficial owners of the securities, as is the case with securities held for
the accounts of customers in bearer form or registered in "street name." These
payments will be the participant's responsibility and not DTC's, the trustee's
or any paying agent's under the indenture, or ours, subject to any statutory or
regulatory requirements as may be in effect from time to time. Payment of
principal and interest to Cede & Co. is our responsibility or the
responsibility of the trustee or any paying agent. Disbursement of payments to
direct participants is DTC's responsibility, and disbursement of payments to
the beneficial owners of the securities is the responsibility of direct and
indirect participants.
DTC may decide to discontinue providing its services as securities
depository with respect to the securities at any time by giving notice to us or
the trustee. Under these circumstances, in the event that a successor
securities depository is not obtained, securities certificates are required to
be printed and delivered.
18
<PAGE>
None of Rite Aid, the trustee, any paying agent or any registrar for the
securities will have any responsibility or liability for any aspect of the
records maintained by DTC relating to, or payments made on account of
beneficial ownership interests in, securities represented in global form, or
for maintaining, supervising or receiving any records relating to any
beneficial ownership interests maintained by DTC.
Concerning the Trustee
Harris Trust and Savings Bank is the trustee under the indenture and we have
appointed them as the initial registrar and paying agent with respect to the
securities.
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Securities for its own account by
accepting the exchange offer must acknowledge that it will deliver a prospectus
in connection with any resale of these Exchange Securities. A broker-dealer may
use this prospectus, as it may be amended or supplemented from time to time, in
connection with resales of Exchange Securities received in exchange for
Restricted Securities where the Restricted Securities were acquired as a result
of market-making activities or other trading activities. We have agreed that,
for a period of 180 days after the Expiration Date, we will make this
Prospectus, as amended or supplemented, available to any broker-dealer for use
in connection with any resale of its Exchange Securities.
We will not receive any proceeds from any sale of Exchange Securities by
broker-dealers. Broker-dealers may sell from time to time Exchange Securities
they receive for their own account pursuant to the exchange offer
. in one or more transactions in the over-the-counter market,
. in negotiated transactions,
. through the writing of options on the Exchange Securities or
. a combination of these methods of resale.
Broker-dealers may sell at
. market prices prevailing at the time of resale,
. prices related to the prevailing market prices or
. negotiated prices.
Any broker-dealer may resell directly to purchasers or to or through brokers
or dealers who may receive compensation in the form of commissions or
concessions from the broker-dealer or the purchasers of the Exchange
Securities. Any broker-dealer that resells Exchange Securities that it received
for its own account by accepting the exchange offer and any broker or dealer
that participates in a distribution of the Exchange Securities may be an
"underwriter" within the meaning of the Securities Act. Any profit on any
underwriter's resale of Exchange Securities and any commission or concessions
received by any underwriters may be underwriting compensation under the
Securities Act. The letter of transmittal states that, a broker-dealer does not
admit that it is an "underwriter" within the meaning of the Securities Act by
acknowledging that it will deliver and by delivering a prospectus.
For a period of 180 days after the expiration date we will promptly send
additional copies of this prospectus and any amendment or supplement to this
prospectus to any broker-dealer that requests them in the letter of
transmittal. We have agreed to pay all expenses incident to the exchange offer,
including the expenses of one counsel for the holders of the securities, other
than commissions or concessions of any broker-dealers and will indemnify the
holders of the securities, including any broker-dealers, against certain
liabilities, including liabilities under the Securities Act.
19
<PAGE>
LEGAL MATTERS
Morgan, Lewis & Bockius LLP will pass upon the validity of the Exchange
Securities for us.
EXPERTS
The consolidated financial statements of Rite Aid and its subsidiaries as of
February 28, 1998 and March 1, 1997 and for each of the years in the three-year
period ended February 28, 1998, and the related financial statement schedule,
have been incorporated by reference into this prospectus and registration
statement and in the registration statement in reliance upon the reports of
KPMG LLP, independent certified public accountants, incorporated by reference
herein, statement and upon authority of said firm as experts in accounting and
auditing.
With respect to the unaudited interim financial information of the Company
and subsidiaries for the periods ended May 30, 1998, August 29, 1998 and
November 28, 1998, incorporated by reference herein, the independent certified
public accountants have reported that they applied limited procedures in
accordance with professional standards for a review of such information.
However, their separate reports included in the Company's quarterly reports on
Form 10-Q for the quarters ended May 30, 1998, August 29, 1998 and November 28,
1998, and incorporated by reference herein, state that they did not audit and
they do not express an opinion on the interim financial information.
Accordingly, the degree of reliance on their reports on such information should
be restricted in light of the limited nature of the review procedures applied.
The accountants are not subject to the liability provisions of Section 11 of the
Securities Act of 1933 for their report on the unaudited interim financial
information because that report is not a "report" or a "part" of the
registration statement prepared or certified by the accountants within the
meaning of Sections 7 and 11 of the Act.
Ernst & Young LLP, independent auditors, have audited the consolidated
financial statements of PCS Holding Corporation and subsidiaries included in
our Form 8-K dated January 19, 1999, as set forth in their report, which is
incorporated by reference in this prospectus and elsewhere in this registration
statement. These financial statements are incorporated by reference in reliance
on Ernst & Young LLP's report, given on their authority as experts in
accounting and auditing.
20
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Rite Aid has not authorized any person to give any information or make any
representations other than those contained in this prospectus, and, if given
or made, you must not rely on any such information or representations as
having been authorized by Rite Aid. This prospectus does not constitute an
offer to sell or the solicitation of an offer to buy any securities other than
the securities to which it relates or an offer to sell or the solicitation of
an offer to buy such securities in any circumstances in which such offer or
solicitation is unlawful. Neither the delivery of this prospectus nor any sale
made hereunder shall, under any circumstances, create any implication that
there has been no change in the affairs of Rite Aid since the date hereof or
that the information contained herein is correct as of any time subsequent to
its date.
----------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Rite Aid Corporation
----------------
PROSPECTUS
----------------
Offer to Exchange 5 1/2% Notes
Due 2000, 6% Notes Due 2005, 6 1/8% Notes Due 2008 and
6 7/8% Debentures Due 2028 for 5 1/2% Notes Due 2000,
6% Notes Due 2005,
6 1/8% Notes Due 2008 and
6 7/8% Debentures Due 2028
, 1999
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law provides that a Delaware
corporation may indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative (a
"proceeding") (other than an action by or in the right of the corporation) by
reason of the fact that such person is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by such person in connection with such action,
suit or proceeding if such person acted in good faith and in a manner such
person reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful. A Delaware
corporation may indemnify any person under such section in connection with a
proceeding by or in the right of the corporation to procure judgment in its
favor, as provided in the preceding sentence, against expenses (including
attorneys' fees) actually and reasonably incurred by him or her in connection
with the defense or settlement of such action, except that no indemnification
shall be made in respect thereof unless, and then only to the extent that, a
court of competent jurisdiction shall determine upon application that such
person is fairly and reasonably entitled to indemnity for such expenses as the
court shall deem proper. A Delaware corporation must indemnify any person who
was successful on the merits or otherwise in defense of any action, suit or
proceeding or in defense of any claim, issue or matter in any proceeding, by
reason of the fact that such person is or was a director, officer, employee or
agent of the corporation or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, against expenses (including
attorneys' fees) actually and reasonably incurred by such person in connection
therewith. A Delaware corporation may pay for the expenses (including
attorneys' fees) incurred by an officer or director in defending a proceeding
in advance of the final disposition upon receipt of an undertaking by or on
behalf of such director or officer to repay such amount if it shall ultimately
be determined that he or she is not entitled to be indemnified by the
corporation.
Registrant's Restated Certificate of Incorporation and By-Laws provide
Registrant will indemnify and hold harmless each person who was or is made a
party or is threatened to be made a party to or is involved in any action, suit
or proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that such person or a person of whom such person is the
legal representative is or was a director or officer of Registrant or is or was
serving at the request of Registrant as a director or officer of another
corporation or of a partnership, joint venture, trust or other enterprise,
including service with respect to employee benefit plans, whether the basis of
such proceeding is alleged action in an official capacity as a director or
officer or in any other capacity while serving as a director or officer shall
be indemnified and held harmless by Registrant to the fullest extent authorized
by the Delaware General Corporation Law as the same exists or may be amended
(but, in the case of any such amendment, only to the extent that such amendment
permits Registrant to provide broader indemnification rights than said law
permitted Registrant to provide prior to such amendment). The indemnity may
include all expense, liability and loss (including attorneys' fees, judgments,
fines, ERISA excise taxes or penalties and amounts paid to be paid in
settlement) reasonably incurred or suffered by such person in connection with
such proceeding and such indemnification shall continue as to a person who has
ceased to be a director, officer, employee or agent of Registrant and shall
inure to the benefit of such person's heirs, executors and administrators.
Section 102(b)(7) of the Delaware General Corporation Law provides that a
Delaware corporation may in its articles of incorporation eliminate or limit
the personal liability of a director to the corporation or its stockholders for
monetary damages for breach of fiduciary duty as a director except for
liability: for any breach of the director's duty of loyalty to the corporation
or its stockholders; for acts or omissions not in good faith or
II-1
<PAGE>
which involve intentional misconduct or a knowing violation of law; under
Section 174 (pertaining to certain prohibited acts including unlawful payment
of dividends or unlawful purchase or redemption of the corporation's capital
stock); or for any transaction from which the director derived an improper
personal benefit. Registrant's Restated Certificate of Incorporation eliminates
the liability of directors for monetary damages for breach of fiduciary duty as
a director, except for liability (i) for any breach of the director's duty of
loyalty to Registrant or its stockholders, (ii) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv)
for any transaction from which the director derived an improper personal
benefit, and provide that if the Delaware General Corporation Law is amended to
authorize corporate action further eliminating or limiting the personal
liability of directors, then the liability of a director of Registrant shall be
eliminated or limited to the fullest extent permitted by the Delaware General
Corporation Law, as so amended.
The Delaware General Corporation Law permits the purchase of insurance on
behalf of directors and officers against any liability asserted against
directors and officers and incurred by such persons in such capacity, or
arising out of their status as such, whether or not the corporation would have
the power to indemnify offices and directors against such liability.
Registrant's Restated Certificate of Incorporation allows Registrant to
maintain insurance, at its expense, to protect itself and any director,
officer, employee or agent of Registrant or another corporation, partnership,
joint venture, trust or other enterprise against any expense, liability or
loss, whether or not Registrant would have the power to indemnify such person
against such expense, liability or loss under the Delaware General Corporation
Law. Registrant has obtained liability coverage, which includes coverage to
reimburse Registrant for amounts required or permitted by law to be paid to
indemnify directors and officers.
The foregoing summary of the Delaware General Corporation Law, Registrant's
Restated Certificate of Incorporation and Registrant's By-Laws is qualified in
its entirety by reference to the relevant provisions of the Delaware General
Corporation Law and by reference to the relevant provisions of Registrant's
Restated Certificate of Incorporation and the relevant provisions of
Registrant's By-Laws.
Item 21. Exhibits and Financial Statement Schedules
(a) The following exhibits, as required by Item 601 of Regulation S-K, are
filed as part of this Registration Statement (previously filed except where
otherwise indicated):
<TABLE>
<C> <S>
4.1 Indenture, dated as of December 21, 1998, by and among Rite Aid
Corporation and Harris Trust and Savings Bank, as Trustee.
4.2 Exchange and Registration Rights Agreement, dated as of December 21,
1998, by and among Rite Aid Corporation, J.P. Morgan Securities Inc.,
Salomon Smith Barney Inc., Lehman Brothers Inc., Nationsbanc
Montgomery Securities LLC, ABN AMRO Incorporated and Chicago Capital
Markets Inc.
Opinion of Morgan, Lewis & Bockius LLP as to the legality of the
5 securities being registered.
12 Statement re Computation of Ratio of Earnings to Fixed Charges.
15* Letter re Unaudited Interim Financial Information.
23.1 Consent of Morgan, Lewis & Bockius LLP (contained in Exhibit 5).
23.2* Consent of KPMG LLP.
23.3* Consent of Ernst & Young LLP
24 Powers of Attorney (contained on signature page).
Statement of Eligibility of Harris Trust and Savings Bank, as Trustee,
25 on Form T-1.
99.1 Form of Letter of Transmittal respecting the offer to exchange 5 1/2%
Notes due 2000, 6% Notes due 2005, 6 1/8% Notes due 2008 and 6 7/8%
Debentures due 2028 which have been registered under the Securities
Act for 5 1/2% Notes due 2000, 6% Notes due 2005, 6 1/8% Notes due
2008 and 6 7/8% Debentures due 2028.
99.2 Form of Notice of Guaranteed Delivery.
</TABLE>
- --------
* Filed herewith
II-2
<PAGE>
(b) Financial Statement Schedules:
Financial Statement Schedules filed herewith:
None applicable.
Item 22. Undertakings.
(a)(1) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act
of 1934) that is incorporated by reference in the registration statement shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(2) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the co-
registrants pursuant to the provisions described under Item 20 or otherwise,
the co-registrants have been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by a
co-registrant of expenses incurred or paid by a director, officer or
controlling person of such co-registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, such co-
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
(b) The undersigned registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus pursuant to
Item 4, 10(b), 11 or 13 of this Form, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained in documents
filed subsequent to the effective date of the registration statement through
the date of responding to the request.
(c) The undersigned registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the registration statement when it became effective.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Amendment No. 1 to the Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Camp Hill, Commonwealth of Pennsylvania on May 5, 1999.
RITE AID CORPORATION
By: /s/ Martin L. Grass
----------------------------------
Martin L. Grass
Chairman of the Board
and Chief Executive
Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 1 to the Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
Signature Title Date
/s/ Martin L. Grass Chairman of the May 5, 1999
- ----------------------------------- Board and Chief
Martin L. Grass Executive Officer
(Principal
Executive Officer)
/s/ Timothy J. Noonan President, Chief May 5, 1999
- ----------------------------------- Operating Officer
Timothy J. Noonan and Director
/s/ Frank M. Bergonzi Executive Vice May 5, 1999
- ----------------------------------- President
Frank M. Bergonzi and Chief Financial
and Accounting
Officer (Principal
Financial and
Accounting Officer)
/s/ Franklin C. Brown Vice Chairman of the May 5, 1999
- ----------------------------------- Board and Director
Franklin C. Brown
* Director May 5, 1999
- -----------------------------------
William J. Bratton
* Director May 5, 1999
- -----------------------------------
Alex Grass
* Director May 5, 1999
- -----------------------------------
Leonard I. Green
* Director May 5, 1999
- -----------------------------------
Nancy A. Lieberman
* Director May 5, 1999
- -----------------------------------
Philip Neivert
* Director May 5, 1999
- -----------------------------------
Leonard N. Stern
* Director May 5, 1999
- -----------------------------------
Preston Robert Tisch
* Director May 5, 1999
- -----------------------------------
Gerald Tsai, Jr.
</TABLE>
/s/ Frank M. Bergonzi
* ______________________________
Attorney in Fact
II-4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<C> <S>
4.1 Indenture, dated as of December 21, 1998, by and among Rite Aid
Corporation and Harris Trust and Savings Bank, as Trustee.
4.2 Exchange and Registration Rights Agreement, dated as of December 21,
1998, by and among Rite Aid Corporation, J.P. Morgan Securities Inc.,
Salomon Smith Barney Inc., Lehman Brothers Inc., Nationsbanc
Montgomery Securities LLC, ABN AMRO Incorporated and Chicago Capital
Markets Inc.
Opinion of Morgan, Lewis & Bockius LLP as to the legality of the
5 securities being registered.
12 Statement re Computation of Ratio of Earnings to Fixed Charges.
15* Letter re Unaudited Interim Financial Information.
23.1 Consent of Morgan, Lewis & Bockius LLP (contained in Exhibit 5).
23.2* Consent of KPMG LLP.
23.3* Consent of Ernst & Young LLP.
24 Powers of Attorney (contained on signature page).
Statement of Eligibility of Harris Trust and Savings Bank, as Trustee,
25 on Form T-1.
99.1 Form of Letter of Transmittal respecting the offer to exchange 5 1/2%
Notes due 2000, 6% Notes due 2005, 6 1/8% Notes due 2008 and 6 7/8%
Notes due 2028 which have been registered under the Securities Act for
5 1/2% Notes due 2000, 6% Notes due 2005, 6 1/8% Notes due 2008 and 6
7/8% Debentures due 2028.
99.2 Form of Notice of Guaranteed Delivery.
</TABLE>
- --------
* Filed herewith
<PAGE>
EXHIBIT 15
----------
Rite Aid Corporation
Camp Hill, Pennsylvania
Gentlemen:
Re: Registration statement of Rite Aid Corporation on Form S-4
With respect to the subject registration statement, we acknowledge our awareness
of the use therein of our reports dated June 30, 1998, October 12, 1998, and
January 12, 1999 related to our reviews of interim financial information.
Pursuant to Rule 436(c) under the Securities Act of 1933, such reports are not
considered part of a registration statement prepared or certified by an
accountant or a report prepared or certified by an accountant within the meaning
of sections 7 and 11 of the Act.
Very truly yours,
/s/ KPMG LLP
Harrisburg, Pennsylvania
May 3, 1999
<PAGE>
EXHIBIT 23.2
------------
Consent of Independent Certified Public Accountants
The Board of Directors
Rite Aid Corporation
We consent to the use of our audit reports dated April 14, 1998 on the
consolidated financial statements of Rite Aid Corporation and subsidiaries as of
February 28, 1998 and March 1, 1997, and for each of the years in the three-year
period ended February 28, 1998, and the related financial statement schedule,
incorporated herein by reference and to the reference to our firm under the
heading "Experts" in the prospectus.
/s/ KPMG LLP
Harrisburg, Pennsylvania
May 3, 1999
<PAGE>
EXHIBIT 23.3
------------
Consent of Ernst & Young LLP, Independent Auditors
The Board of Directors
Rite Aid Corporation
We consent to the reference to our firm under the caption "Experts" and to the
use of our report dated December 11, 1998 included in Rite Aid Corporation's
Form 8-K of January 19, 1999, with respect to the consolidated financial
statements of PCS Holding Corporation and Subsidiaries incorporated by
reference in Amendment No. 3 to the Registration Statement (Form S-4 No.
333-66901) and related Prospectus of Rite Aid Corporation for the registration
of $200,000,000 of Dealer Remarketable Securities .
/s/ Ernst & Young LLP
Phoenix, Arizona
April 28, 1999
