Exhibit 4.16




                             AMENDMENT NUMBER TWO
                                    TO THE
                     PERRY DISTRIBUTORS, INC. 401(K) PLAN



            WHEREAS, Perry Distributors, Inc. ("Corporation") has the
authority under the Perry Distributors, Inc. 401(k) Plan ("Plan") to amend the
Plan in any respect at any time; and

            WHEREAS, the Plan was completely amended and restated effective
January 1, 2001 and has since been amended; and

            WHEREAS, the Corporation now desires to amend the Plan, effective
as of the date on which a Final Order (as defined in the Settlement Agreement)
has been entered ("Amendment Effective Date"), to provide for certain special
payments to the Plan, pursuant to the terms of the Settlement Agreement
(hereinafter defined);

            NOW, THEREFORE, effective as of the Amendment Effective Date, the
Plan is hereby amended as follows:

            1.   A new Section 5.8 is added to Article V of the Plan, to read
as follows:

                  "5.8 SETTLEMENT AGREEMENT CONTRIBUTIONS

                  Pursuant to the terms of the Settlement Agreement, and after
                  the Effective Date of the Settlement Agreement, there shall
                  be made, in addition to the contributions otherwise
                  prescribed in this Article, a restorative payment to the
                  Plan in the manner and the amount described in this Section.

                  (a) Definitions: For the purpose of this Section:

                           (1) the term "Settlement Agreement" means the
                  Stipulation and Agreement of Settlement dated as of October
                  31, 2002, by and among State Street Bank and Trust Company;
                  Robert Kolar, individually and as representative of the Plan
                  and its participants and beneficiaries; Rite Aid
                  Corporation; The Prudential Insurance Company of America and
                  Prudential Securities, Inc.; and Frank Bergonzi, Thomas F.
                  Foley, Richard Varmecky, Robert R. Souder, Dean Dell Antonia
                  and Edwin E. Lilja;

                           (2) the term "Settlement Fund" means the separate
                  fund that has been established pursuant to the terms of the
                  Settlement Agreement, and

                           (3) the term "Effective Date of the Settlement
                  Agreement" means the date as of which all preconditions to
                  the effectiveness of the Settlement Agreement have been
                  satisfied.

                  (b) There shall be transferred from the Settlement Fund a
                  restorative payment to the Plan in such amount as is
                  required under the Settlement Agreement. The amount so
                  transferred shall be allocated among the Accounts (either
                  existing or to be established) of all members of the Class
                  (as defined in the Settlement Agreement) in accordance with
                  the methodology prescribed therein. The allocations
                  described in this Section 5.8(b) shall:

                           (1) for recordkeeping purposes, be commingled with
                  Elective Contributions;

                           (2) be fully and immediately vested; and

                           (3) until such date as the Class member makes an
                  effective and superseding election, be invested in
                  accordance with the member's most recent investment election
                  on file with the Plan on the date the restorative payment is
                  received by the Plan, or, in the absence of such an
                  election, be invested in such investment fund as is
                  established under the Plan or under Plan procedures for any
                  portion of the member's interest in the Plan for which he
                  has failed to direct the investment in accordance with
                  Section 11.3."

            2.    In all other respects, the provisions of the Plan shall remain
in full force and effect.

            IN WITNESS WHEREOF, this Amendment to the Plan has been executed
this 12th day of February, 2003.

                                       PERRY DISTRIBUTORS, INC.



                                       By: /s/ Robert B. Sari
                                           ----------------------------------
                                       Title:  Vice President and Secretary