As filed with the Securities and Exchange Commission on May 25, 2001
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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RITE AID CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 23-1614034
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
30 Hunter Lane
Camp Hill, Pennsylvania 17011
(717) 761-2633
(Address of Principal Executive Offices)
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1990 Omnibus Stock Incentive Plan
1999 Stock Option Plan
2000 Omnibus Equity Plan
2001 Stock Option Plan
(Full title of the plan)
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Elliot S. Gerson, Esq.
Senior Executive Vice President and
General Counsel
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)
CALCULATION OF REGISTRATION FEE
---------------------------- ------------------ ---------------------- ---------------------- --------------------
Proposed Proposed
Title of Amount Maximum Maximum Aggregate
Securities to be to be Offering Price Per Offering Price Amount of
Registered Registered (1) Share (2) (3) Registration Fee
---------------------------- ------------------ ---------------------- ---------------------- --------------------
Common Stock, $1.00 par 922,567 $8.260 $7,620,403.42 $1,905.10
value (4)
---------------------------- ------------------ ---------------------- ---------------------- --------------------
Common Stock, $1.00 par 20,556,000 $8.260 $169,792,560.00 $42,448.14
value (5)
---------------------------- ------------------ ---------------------- ---------------------- --------------------
Common Stock, $1.00 par 210,000 $2.4375 $511,875.00 $127.97
value, underlying options
granted or issued and
outstanding (6)
---------------------------- ------------------ ---------------------- ---------------------- --------------------
50,000 $2.6250 $131,250.00 $32.81
---------------------------- ------------------ ---------------------- ---------------------- --------------------
16,801,462 $2.7500 $46,204,020.50 $11,551.01
---------------------------- ------------------ ---------------------- ---------------------- --------------------
220,000 $3.0000 $660,000.00 $165.00
---------------------------- ------------------ ---------------------- ---------------------- --------------------
540,000 $3.4375 $1,856,250.00 $464.08
---------------------------- ------------------ ---------------------- ---------------------- --------------------
154,000 $3.9375 $606,375.00 $151.59
---------------------------- ------------------ ---------------------- ---------------------- --------------------
20,134,500 $4.0500 $81,544,725.00 $20,386.81
---------------------------- ------------------ ---------------------- ---------------------- --------------------
---------------------------- ------------------ ---------------------- ---------------------- --------------------
Proposed Proposed
Title of Amount Maximum Maximum Aggregate
Securities to be to be Offering Price Per Offering Price Amount of
Registered Registered (1) Share (2) (3) Registration Fee
---------------------------- ------------------ ---------------------- ---------------------- --------------------
100,000 $4.0625 $406,250.00 $101.56
---------------------------- ------------------ ---------------------- ---------------------- --------------------
5,000 $4.8750 $24,375.00 $6.09
---------------------------- ------------------ ---------------------- ---------------------- --------------------
5,112,301 $5.3750 $27,478,617.88 $6,869.65
---------------------------- ------------------ ---------------------- ---------------------- --------------------
23,000 $5.4375 $125,062.50 $31.27
---------------------------- ------------------ ---------------------- ---------------------- --------------------
108,500 $5.6250 $610,312.50 $152.58
---------------------------- ------------------ ---------------------- ---------------------- --------------------
10,000 $5.6825 $56,825.00 $14.21
---------------------------- ------------------ ---------------------- ---------------------- --------------------
554,000 $6.0900 $3,373,860 $843.47
---------------------------- ------------------ ---------------------- ---------------------- --------------------
10,000 $6.3125 $63,125.00 $15.78
---------------------------- ------------------ ---------------------- ---------------------- --------------------
367,500 $6.5000 $2,388,750.00 $597.19
---------------------------- ------------------ ---------------------- ---------------------- --------------------
20,000 $6.7500 $135,000.00 $33.75
---------------------------- ------------------ ---------------------- ---------------------- --------------------
20,000 $6.8125 $136,250.00 $34.06
---------------------------- ------------------ ---------------------- ---------------------- --------------------
259,000 $7.0000 $1,813,000.00 $453.25
---------------------------- ------------------ ---------------------- ---------------------- --------------------
11,000 $7.1250 $78,375.00 $19.59
---------------------------- ------------------ ---------------------- ---------------------- --------------------
180,000 $7.5000 $1,350,000.00 $337.50
---------------------------- ------------------ ---------------------- ---------------------- --------------------
142,012 $8.0000 $1,136,096.00 $284.02
---------------------------- ------------------ ---------------------- ---------------------- --------------------
150,600 $8.9125 $1,342,222.50 $335.56
---------------------------- ------------------ ---------------------- ---------------------- --------------------
4,700 $8.9150 $41,900.50 $10.48
---------------------------- ------------------ ---------------------- ---------------------- --------------------
2,750 $8.9400 $24,585.00 $6.15
---------------------------- ------------------ ---------------------- ---------------------- --------------------
1,458,649 $9.2500 $13,492,503.25 $3,373.13
---------------------------- ------------------ ---------------------- ---------------------- --------------------
150,850 $9.5625 $1,442,503.13 $360.63
---------------------------- ------------------ ---------------------- ---------------------- --------------------
4,700 $9.5650 $44,955.50 $11.24
---------------------------- ------------------ ---------------------- ---------------------- --------------------
150,850 $10.0625 $1,517,928.13 $379.48
---------------------------- ------------------ ---------------------- ---------------------- --------------------
5,950 $10.0650 $59,886.75 $14.97
---------------------------- ------------------ ---------------------- ---------------------- --------------------
150,850 $10.3125 $1,555,640.63 $388.91
---------------------------- ------------------ ---------------------- ---------------------- --------------------
5,950 $10.3150 $61,374.25 $15.34
---------------------------- ------------------ ---------------------- ---------------------- --------------------
10,000 $10.8750 $108,750.00 $27.19
---------------------------- ------------------ ---------------------- ---------------------- --------------------
155,850 $11.3125 $1,763,053.13 $440.76
---------------------------- ------------------ ---------------------- ---------------------- --------------------
8,450 $11.3150 $95,611.75 $23.90
---------------------------- ------------------ ---------------------- ---------------------- --------------------
7,200 $11.5000 $82,800.00 $20.70
---------------------------- ------------------ ---------------------- ---------------------- --------------------
167,000 $11.8750 $1,983,125.00 $495.78
---------------------------- ------------------ ---------------------- ---------------------- --------------------
166,500 $12.3750 $2,060,437.50 $515.11
---------------------------- ------------------ ---------------------- ---------------------- --------------------
1,250 $12.5000 $15,625.00 $3.91
---------------------------- ------------------ ---------------------- ---------------------- --------------------
2,500 $12.6875 $31,718.75 $7.93
---------------------------- ------------------ ---------------------- ---------------------- --------------------
100,000 $13.8750 $1,387,500.00 $346.88
---------------------------- ------------------ ---------------------- ---------------------- --------------------
166,000 $14.0000 $2,324,000.00 $581.00
---------------------------- ------------------ ---------------------- ---------------------- --------------------
3,000 $14.1250 $42,375.00 $10.59
---------------------------- ------------------ ---------------------- ---------------------- --------------------
284,000 $14.3125 $4,064,750.00 $1,016.19
---------------------------- ------------------ ---------------------- ---------------------- --------------------
15,000 $14.3150 $214,725.00 $53.68
---------------------------- ------------------ ---------------------- ---------------------- --------------------
10,000 $14.5650 $145,650.00 $36.41
---------------------------- ------------------ ---------------------- ---------------------- --------------------
166,000 $15.6250 $2,593,750.00 $648.44
---------------------------- ------------------ ---------------------- ---------------------- --------------------
---------------------------- ------------------ ---------------------- ---------------------- --------------------
Proposed Proposed
Title of Amount Maximum Maximum Aggregate
Securities to be to be Offering Price Per Offering Price Amount of
Registered Registered (1) Share (2) (3) Registration Fee
---------------------------- ------------------ ---------------------- ---------------------- --------------------
1,000 $15.6875 $15,687.50 $3.92
---------------------------- ------------------ ---------------------- ---------------------- --------------------
160,325 $15.8750 $2,545,159.38 $636.29
---------------------------- ------------------ ---------------------- ---------------------- --------------------
2,050 $16.0000 $32,800.00 $8.20
============================ ================== ====================== ====================== ====================
Total $96,799.25(7)
============================ ================== ====================== ====================== ====================
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(1) Except for the 922,567 shares referred to in footnote 4 below, this
registration statement relates to shares of Common Stock, par value
$1.00 per share of the Rite Aid Corporation (the "Company") consisting
of the aggregate number of shares which may be sold upon the exercise
of options which have been granted and/or may hereafter be granted
under the Company's 1990 Omnibus Stock Incentive Plan, 1999 Stock
Option Plan, 2000 Omnibus Equity Plan and 2001 Stock Option Plan
(collectively, the "Plans").
(2) In accordance with Rule 457 promulgated under the Securities Act of
1933 (the "Securities Act"), the Proposed Maximum Offering Price Per
Share is based upon either (i) the price at which the options may be
exercised or (ii) the market value as of May 18, 2001 of the Common
Stock, which was $8.260 (the average of the high and low prices of the
Shares reported on the New York Stock Exchange on May 18, 2001).
(3) The Proposed Maximum Aggregate Offering Price is estimated solely for
the purpose of calculating the registration fee pursuant to Rule 457 of
the Securities Act.
(4) Represents "restricted securities" (as that term is defined in Section
C of the General Instructions to Form S-8) of the Company.
(5) Represents shares available for future grants. The number of shares
available under the Company's 1999 Stock Option, 2000 Omnibus Equity
Plan, and 2001 Stock Option Plan at May 21, 2001 is: 1,211,318 shares,
4,748,682 shares, and 14,596,000 shares, respectively.
(6) Represents shares underlying options issued and outstanding. At May 21,
2001 the number of underlying options issued and outstanding under the
Company's 1990 Omnibus Stock Incentive Plan, 1999 Stock Option Plan,
2000 Omnibus Equity Plan and 2001 Stock Option Plan is: 13,544,867
shares, 8,788,682 shares, 15,789,500 shares, and 5,404,000 shares,
respectively. An additional 8,600,000 shares underlying options were
issued to employees of the Company, pursuant to individual employment
agreements and restricted stock and stock option award agreements.
(7) Rite Aid Corporation previously paid a filing fee of $834,000.00 with
respect to our Form S-3, 333-70777, filed on January 19, 1999. We are
transferring $96,799.25 to this Form S-8 registration statement.
EXPLANATORY NOTE
This Registration Statement contains two parts. The first part contains
a prospectus pursuant to Form S-3 (in accordance with Section C of the General
Instructions to the Form S-8) which covers reoffers and resales of "restricted
securities" (as that term is defined in Section C of the General Instructions to
Form S-8) of Rite Aid Corporation. This Reoffer prospectus relates to 922,567
shares of common stock that have been issued to certain employees of Rite Aid
Corporation. The second part of this Registration Statement contains Information
Required in the Registration Statement pursuant to Part II of Form S-8. The Plan
Information specified by Part I of Form S-8 is not being filed with the
Securities and Exchange Commission but will be delivered to all participants in
the Plans pursuant to Securities Act Rule 428(b)(1).
REOFFER PROSPECTUS
922,567 Shares of Common Stock, $1.00 par value
RITE AID CORPORATION
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The shares of common stock of Rite Aid Corporation ("Rite Aid" or the
"Company") covered by this reoffer prospectus may be offered and sold from time
to time by selling stockholders identified in this prospectus for their own
accounts.
Our common stock is traded on the New York Stock Exchange and the
Pacific Stock Exchange under the symbol "RAD." On May 24, 2001, the closing
price of our common stock was $9.05 per share. The selling stockholders may sell
their shares in one or more transactions on the New York Stock Exchange or the
Pacific Exchange, in privately negotiated transactions, or through a combination
of these methods. These sales may be at fixed prices, at market prices
prevailing at the time of sale, at prices relating to such prevailing prices or
at negotiated prices. Rite Aid will receive no part of the proceeds from sales
made under this reoffer prospectus.
The Selling Stockholders may sell shares through one or more agents,
brokers or dealers or directly to purchasers. Such brokers or dealers may
receive compensation in the form of commissions, discounts or concessions from
the Selling Stockholders and/or purchasers of the shares, or both. Such
compensation as to a particular broker or dealer may be in excess of customary
commission. In connection with their sales, the Selling Stockholders and any
participating broker or dealer may be deemed to be "underwriters" within the
meaning of the Securities Act, as amended, and any commissions they receive and
the proceeds of any sale of shares may be deemed to be underwriting discounts
and commissions under the Securities Act.
------------------
This investment involves a high degree of risk. Please see "Risk
Factors" on page 8.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined whether
this reoffer prospectus is truthful or complete. Any representation to the
contrary is a criminal offense.
The date of this reoffer prospectus is May 25, 2001.
TABLE OF CONTENTS
Additional Information.........................................................2
Incorporation of Certain Documents by Reference................................3
The Company....................................................................4
Risk Factors...................................................................8
Cautionary Statement Regarding Forward-Looking Statements.....................13
Use of Proceeds...............................................................14
Selling Stockholders..........................................................14
Plan of Distribution..........................................................15
Legal Matters.................................................................15
Experts.......................................................................15
ADDITIONAL INFORMATION
Rite Aid has filed with the Securities and Exchange Commission (the
"Commission" or "SEC") a Registration Statement on Form S-8 under the Securities
Act with respect to the shares of Common Stock offered hereby. This reoffer
prospectus does not contain all of the information set forth or incorporated by
reference in the Registration Statement and the exhibits thereto. For further
information with respect to the Company and the Common Stock offered hereby, we
encourage you to read this entire document and all other documents to which we
refer.
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and, in
accordance therewith, files reports and other information with the Commission.
The Registration Statement, including exhibits, and the reports and other
information filed by the Company can be inspected without charge at the public
reference facilities maintained by the Commission at the Commission's principal
office at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549. Copies of
such material can be obtained from such office at fees prescribed by the
Commission. The public may obtain information on the operation of the Public
Reference room by calling the Commission at 1-800-SEC-0330. The Commission
maintains a World Wide Web site that contains reports, proxy and information
statements and other information regarding registrants that file electronically
with the Commission. The address of this site is http://www.sec.gov.
2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed with the Commission
pursuant to the Exchange Act, are hereby incorporated by reference in, and shall
be deemed to be a part of, this Registration Statement:
o The Company's Annual Report on Form 10-K for the fiscal year ended
March 3, 2001 (the "Annual Report"), filed May 21, 2001; and
o The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, dated July 18, 1991,
filed by the Company to register such securities under the Exchange
Act, including all amendments and reports filed for the purpose of
updating such description.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act prior to the filing of a post-effective
amendment which indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold are incorporated by reference
in this Registration Statement. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Registration Statement to the
extent that a statement contained herein, or in any subsequently filed document
which also is or is deemed to be incorporated by reference herein, modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute part of this
Registration Statement.
We will provide without charge to any person to whom this prospectus is
delivered, upon written or oral request of such person, a copy of each document
incorporated by reference in the registration statement (other than exhibits to
such documents unless such exhibits are specifically incorporated by reference
into this prospectus). Requests should be directed to Investor Relations, at
Rite Aid Corporation, 30 Hunter Lane, Camp Hill, Pennsylvania 17011. The
Company's telephone number is (717) 761-2633 and its website is located at
http://www.riteaid.com. Information on the Company's website is not incorporated
by reference into this prospectus.
3
THE COMPANY
Overview
We are the second largest retail drugstore chain in the United States
based on store count and the third largest based on sales. We operate our
drugstores in 30 states across the country and in the District of Columbia. As
of March 3, 2001, we operated 3,648 stores and had a first or second place
market position in 34 of the 65 major U.S. metropolitan markets in which we
operated. Our stores are an average of 12,663 square feet.
Our headquarters are located at 30 Hunter Lane, Camp Hill, Pennsylvania
17011, and our telephone number is (717) 761-2633. Our common stock is listed on
the New York Stock Exchange and the Pacific Stock Exchange under the trading
symbol "RAD".
During all of the fiscal year ended March 3, 2001 ("fiscal 2001"), we
operated in the retail drug segment and for a portion of fiscal 2001, we also
operated in the pharmacy benefit management ("PBM") segment.
Through our retail drug segment, we sell prescription drugs, sales of
which represented approximately 59.5% of our total sales during fiscal 2001. Our
drugstores filled over 204 million prescriptions during fiscal 2001. Our
drugstores also offer non-prescription medications, health and beauty aids and
personal care items, cosmetics, household items, beverages, convenience foods,
greeting cards, photo processing, seasonal merchandise and numerous other
everyday and convenience products which we refer to as our "front-end products."
Until October 2, 2000, when we sold it to Advance Paradigm, Inc. (now
AdvancePCS), we owned PCS Health Systems, Inc. ("PCS"), one of the nation's
largest providers of pharmacy benefit management services to employers,
insurance carriers and managed care companies. As a result of the sale, the PBM
segment is reported as a discontinued operation for all relevant periods in the
financial statements included in the Annual Report.
From the beginning of fiscal 1997 until December 1999, we were engaged
in an aggressive expansion program. During that period, we purchased 1,554
stores, relocated 866 stores, opened 445 new stores, remodeled 308 stores and
acquired PCS. These activities had a significant negative impact on our
operating results, severely strained our liquidity and increased our
indebtedness to $6.6 billion as of February 26, 2000. In October 1999, we
announced that we had identified accounting irregularities and our former
chairman and chief executive officer resigned. In November 1999, our former
auditors resigned and withdrew their previously issued opinions on our financial
statements for the fiscal years 1998 and 1999. Thereafter, investigations were
begun by the Securities and Exchange Commission and the United States Attorney
for the Middle District of Pennsylvania into our affairs. In addition, the
complaint in a securities class action lawsuit, which had been filed in March
1999, was amended to include allegations based upon the accounting
irregularities we disclosed. In December 1999, new senior management was hired.
In response to the situation we faced, we completed the following:
o Restated our financial statements for fiscal years 1998 and 1999,
engaged new auditors to audit our financial statements for fiscal
years 1998, 1999 and 2000, and resumed normal financial reporting;
o Refinanced our near term indebtedness to defer virtually all
principal amortization to no earlier than August 2002;
o Improved our front end same store sales growth from a minus 2.2% in
fiscal 2000 to a positive 6.5% in fiscal 2001 by improving store
conditions and launching a competitive marketing program;
4
o Reduced our indebtedness by $1.4 billion from $6.6 billion on
February 26, 2000 to $5.2 billion on April 28, 2001 with the
proceeds from the sale of PCS and as a result of debt for equity
exchanges;
o Curtailed our expansion plans resulting in an approximately $441
million reduction in capital expenditures from fiscal 2000 to fiscal
2001;
o Pending court approval, settled the securities class action and
related lawsuits for $45 million to be funded with insurance
proceeds and $155 million of common stock, cash and/or notes to be
issued and paid in January 2002;
o Began development and implementation of a comprehensive plan to
address accounting systems and controls; and
o Entered into a bank commitment letter to refinance a significant
portion of our indebtedness, see "Recent Event".
Our long term operating strategy is to focus on improving the
productivity of our existing store base. We believe that improving the sales of
our existing stores is important to improving our future profitability and cash
flow. We also believe that the substantial investment made in our store base
over the last five years has given us one of the most modern store bases in the
industry. However, our store base has not yet achieved the level of sales
productivity that our major competitors achieve. We intend to improve the
performance of our existing stores by continuing to (1) capitalize on the
substantial investment in our stores and distribution facilities; (2) enhance
our customer and employee relationships; and (3) improve the product offerings
in our stores. Moreover, it is estimated that pharmacy sales in the United
States will increase more than 75% over the next five years. This anticipated
growth is expected to be fueled by the "baby boom" generation entering their
50's, the increasing life expectancy of the American population and the
introduction of several new successful drugs and inflation. We believe that this
growth will help increase the sales productivity of our existing store base.
Since the beginning of fiscal 1997, we have opened 466 new stores,
relocated 945 stores, generally to larger or free-standing sites, remodeled 406
stores and closed 1,139 stores. We also acquired 1,554 stores during the same
period. All of our stores are integrated into a common information system. At
March 3, 2001, 49.8% of our stores had been constructed, relocated or remodeled
since the beginning of fiscal 1997. Our new and relocated stores are generally
larger and need to develop a critical mass of customers to achieve
profitability, which generally takes two to four years. Therefore, attracting
more customers is a key component of our long term operating strategy. We have
also improved our distribution network to support these new stores by, among
other things, opening two high capacity distribution centers.
We have initiated various programs that are designed to improve our
image with customers. These include our weekly distribution of a nationwide
advertising circular to announce vendor promotions, weekly sales items and, in
our expanded test market, our customer reward program, "Rite Rewards." We have
also initiated programs that are specifically directed to our pharmacy business.
These include reduced cash prices and an increased focus on attracting and
retaining managed care customers. Through the use of technology and attention to
customers' needs and preferences, we are increasing our efforts to identify
inventory and product categories that will enable us to offer more personalized
products and services to our customers. We continue to develop and implement
employee training programs to improve customer service and educate our employees
about the products we offer. We are also developing employee programs that
create compensatory and other incentives for employees to provide customers with
quality service, to promote our private label brands and to improve our
corporate culture.
5
We continue to add popular and profitable product departments, such as
our General Nutrition Companies, Inc. ("GNC") stores-within-Rite Aid-stores and
one-hour photo development departments. We continue to develop ideas for new
product departments and have begun to implement plans to expand the categories
of our front-end products. During fiscal 2001, we undertook several initiatives
to increase sales of our Rite Aid brand products and generic prescription drugs.
As private label and generic prescription drugs generate higher margins than
branded label, we expect that increases in the sales of these products would
enhance our profitability. We believe that the addition of new departments and
increases in offerings of products and services are integral components of our
strategy to distinguish us from other national drugstore chains.
Recent Event
On May 16, 2001, we issued a press release announcing the details of a
comprehensive $3.0 billion refinancing package that includes a commitment for a
new $1.9 billion senior secured credit facility fully underwritten by Citibank
NA, J.P. Morgan Chase & Co., Credit Suisse First Boston and Fleet Retail
Finance, Inc. We announced that upon completion of the planned transactions
scheduled to close during our second fiscal quarter, we will have significantly
reduced our debt and the amount of our debt maturing prior to March 2005.
The closing of the new credit facility is subject to the satisfaction
of customary closing conditions and our issuance of approximately $1.05 billion
in new debt or equity securities, of which $527 million, as of May 16, 2001, has
been committed or arranged, as described herein. We plan to raise, at a minimum,
the additional $523 million by issuing equity and fixed income securities and
through real estate mortgage financings in transactions which are intended to
close simultaneously with, and which will be conditioned upon, the closing of
the new credit facility. The new credit facility will be secured by inventory,
accounts receivable and certain other assets owned by our subsidiaries. The
facility will be used to repay our first and second lien debt, pay expenses
associated with the planned refinancing and for general working capital
purposes.
In the $527 million in new debt and equity securities that has already
been committed is a $149 million private placement comprised of 22.7 million
shares of common stock committed on March 22, 2001 at $5.50 per share and 3.8
million shares of common stock committed on May 2, 2001 at $6.50 per share. The
closing of this equity investment will take place simultaneously with, and is
contingent upon, the completion of the new credit facility.
One of the holders has committed to exchange $152 million of our 10.5%
senior secured notes due 2002 for $152 million of new 12.5% senior secured notes
maturing in 2006. The new notes will be secured by a second lien on the
collateral securing the new credit facility. In connection with the exchange,
the holder will receive five-year warrants to purchase approximately 3.0 million
shares of our common stock at $6.00 per share. The exchange will take place
simultaneously with, and is contingent upon, the closing of the new credit
facility.
We also announced that included in the $527 million that has already
been committed are recently completed or contracted private exchanges of common
stock for $226.2 million of our bank debt and 10.5% senior secured notes due
2002, as described herein.
Once the refinancing transactions are completed, our remaining debt due
before March 2005 will be $152.0 million of our 5.25% convertible subordinated
notes due 2002, $107.8 million of our 6.0% dealer remarketable securities due
2003, $259.2 million of our 10.5% senior secured notes due 2002 and amortization
of the new credit facility. We expect to use internally generated funds to
retire both the 5.25% notes and the dealer remarketable securities at maturity
and to meet the amortization payments under the new credit facility. We also
announced that funds to repay the 10.5% notes at maturity are included in the
new credit facility.
6
We are being advised on the refinancing by Salomon Smith Barney Inc.,
J.P. Morgan Chase & Co. and Credit Suisse First Boston.
The debt and equity securities that we will offer will not be
registered under the Securities Act of 1933, as amended, and may not be offered
or sold in the United States absent registration or an applicable exemption from
such registration requirements.
As described in our May 16, 2001 press release, the completion of the
proposed refinancing of our credit facility is subject to customary closing
conditions, some of which are beyond our control, and also to our ability to
successfully complete the additional financings required by the commitment
letter for the refinancing. While we believe we will successfully complete the
refinancing, there can be no assurance that the refinancing transactions will be
consummated.
7
RISK FACTORS
Risks Related to Our Financial Condition
We are highly leveraged. Our substantial indebtedness severely limits cash flow
available for our operations and could adversely affect our ability to service
debt or obtain additional financing if necessary.
As of April 28, 2001, we had $4.1 billion of outstanding indebtedness
for borrowed money (including current maturities but excluding letters of
credit) and $1.1 billion of capital leases and a negative stockholders' equity.
As of the same date, we had additional borrowing capacity under our revolving
credit facility of $264.0 million. Based on the indebtedness outstanding at
April 28, 2001 and the then current interest rates, our annualized cash interest
expense would be approximately $433.6 million.
Our high level of indebtedness will continue to restrict our
operations. Among other things, our indebtedness will:
o limit our ability to obtain additional financing;
o limit our flexibility in planning for, or reacting to, changes in
the markets in which we compete;
o place us at a competitive disadvantage relative to our competitors
with less indebtedness;
o render us more vulnerable to general adverse economic and industry
conditions; and
o require us to dedicate substantially all of our cash flow to service
our debt.
A substantial portion of our indebtedness matures in August and September 2002.
Our ability to refinance this indebtedness will be substantially dependent on
our ability to improve our operating performance.
If we do not consummate the refinancing transaction described under
"Recent Event", approximately $2.5 billion of our indebtedness at April 28, 2001
will mature in August and September 2002. In order to satisfy these obligations,
we will need to refinance them, sell assets to satisfy them or seek postponement
of their maturity dates from our existing lenders. Our ability successfully to
accomplish any of these transactions will be substantially dependent on the
successful execution of our long term strategic plan and the resulting
improvements in our operating performance.
The interest rate on certain of our outstanding indebtedness is based upon
floating interest rates. If interest rates increase, our interest payment
obligations will increase.
Approximately $853.7 million of our outstanding indebtedness as of
April 28, 2001 bears an interest rate that varies depending upon LIBOR. If we
borrow additional amounts under our senior secured facility, the interest rate
on those borrowings will vary depending upon LIBOR. If LIBOR rises, the interest
rates on this outstanding debt will also increase. Therefore an increase in
LIBOR would increase our interest payment obligations under these outstanding
loans and have a negative effect on our cash flow and financial condition. We
anticipate that any replacement financing we obtain will also have the interest
rate on a floating rate.
The covenants in our outstanding indebtedness impose restrictions that may limit
our operating and financial flexibility.
8
The covenants in the instruments governing our outstanding indebtedness
restrict our ability to incur liens and debt, pay dividends, make redemptions
and repurchases of capital stock, make loans, investments and capital
expenditures, prepay, redeem or repurchase debt, engage in mergers,
consolidations, asset dispositions, sale-leaseback transactions and affiliate
transactions, change our business, amend certain debt and other material
agreements, issue and sell capital stock of subsidiaries, make distributions
from subsidiaries and grant negative pledges to other creditors. We anticipate
that any replacement financing we obtain, including those proposed by our May
15, 2001 bank commitment letter, will impose similar restrictions.
Moreover, if we are unable to meet the terms of the financial covenants
or if we breach any of these covenants, a default could result under one or more
of these agreements. A default, if not waived by our lenders, could result in
the acceleration of our outstanding indebtedness and cause our debt to become
immediately due and payable. If acceleration occurs, we would not be able to
repay our debt and it is unlikely that we would be able to borrow sufficient
additional funds to refinance such debt. Even if new financing is made available
to us, it may not be available on terms acceptable to us.
Risks Related to Our Operations
Major lawsuits have been brought against us and certain of our subsidiaries, and
there are currently pending both civil and criminal investigations by the U.S.
Securities and Exchange Commission and the United States Attorney. Any criminal
conviction against us may result in the loss of licenses that are material to
the conduct of our business, which would have a negative effect on our financial
condition, results of operations and cash flows.
There are currently pending both civil and criminal governmental
investigations by the SEC and the United States Attorney concerning our
financial reporting and other matters. In addition, an investigation has also
been commenced by the U.S. Department of Labor concerning our employee benefit
plans, including our principal 401(k) plan, which permitted employees to
purchase our common stock. Purchases of our common stock under the plan were
suspended in October 1999. In January 2001, we appointed an independent trustee
to represent the interests of these plans in relation to the company and to
investigate possible claims the plans may have against us. Both the independent
trustee and the Department of Labor have asserted that the plans may have claims
against us. These investigations are ongoing and we cannot predict their
outcomes. If we were convicted of any crime, certain contracts that are material
to our operations may be revoked, which would have a material adverse effect on
our results of operations and financial condition. In addition, substantial
penalties, damages, or other monetary remedies assessed against us could also
have a material adverse effect on our results of operations, financial condition
and cash flows.
Given the size and nature of our business, we are subject from time to
time to various lawsuits which, depending on their outcome, may have a negative
impact on our results of operations, financial condition and cash flows.
We are substantially dependent on a single supplier of pharmaceutical products
and our other suppliers to sell products to us on satisfactory terms.
We obtain approximately 93% of our pharmaceutical supplies from a
single supplier, McKesson HBOC, Inc., pursuant to a long-term contract. Pharmacy
sales represented approximately 59.5% of our total sales during fiscal 2001,
and, therefore, our relationship with McKesson HBOC is important to us. Any
significant disruptions in our relationships with our suppliers, particularly
our relationship with McKesson HBOC would make it difficult for us to continue
to operate our business, and would have a material adverse effect on our results
of operations and financial condition.
Our internal accounting systems and controls may be insufficient.
9
An audit of our financial statements for fiscal years 1999 and 1998,
following a previous restatement, concluded in July 2000 and resulted in an
additional restatement of fiscal years 1999 and 1998. Following its review of
our books and records, our management concluded that further steps were needed
to establish and maintain the adequacy of our internal accounting systems and
controls. In connection with the above audits of our financial statements,
Deloitte & Touche LLP advised us that it believed there were numerous
"reportable conditions" under the standards established by the American
Institute of Certified Public Accountants which relate to our accounting systems
and controls and could adversely affect our ability to record, process,
summarize and report financial data consistent with the assertions of management
in the financial statements. In order to address the reportable conditions
identified, we are developing and implementing comprehensive, adequate and
reliable accounting systems and controls which address the reportable conditions
identified by Deloitte & Touche LLP. If, however, we determine that our internal
accounting systems and controls require additional improvements beyond those
identified, we may need to commit substantial resources, including time from our
management team, to implement new systems and controls.
We cannot assure you that management will be able to successfully manage our
business or successfully implement our strategic plan.
In December 1999, we hired a new management team. Our management team
has considerable experience in the retail industry. Nonetheless, we cannot
assure you that our management will be able successfully to manage our business
or successfully implement our strategic business plan.
We are dependent on our management team, and the loss of their services could
have a material adverse effect on our business and the results of our operations
or financial condition.
The success of our business is materially dependent upon the continued
services of our chairman and chief executive officer, Robert G. Miller, and the
other members of our management team. The loss of Mr. Miller or other key
personnel due to death, disability or termination of employment could have a
material adverse effect on the results of our operations or financial condition,
or both. Additionally, we cannot assure you that we will be able to attract or
retain other skilled personnel in the future.
We need to continue to improve our operations in order to improve our financial
condition, but our operations will not improve if we cannot continue to
effectively implement our business strategy.
Our operations during fiscal 2000 were adversely affected by a number
of factors, including our financial difficulties, inventory shortages,
allegations of violations of the law, including drug pricing issues, problems
with suppliers and uncertainties regarding our ability to produce audited
financial statements. To improve operations, new management developed and in
fiscal 2001 had been implementing and continues to implement, a business
strategy to improve the pricing of products, provide more consistent advertising
through weekly, national circulars, eliminated inventory shortages and out-dated
inventory, shortages, resolved issues and disputes with our vendors, developed
programs intended to enhance customer relationships and provide better service
and continue to improve our stores and the product offerings within our stores.
If we are not successful in implementing our business strategy, or if our
business strategy is not effective, we may not be able to continue to improve
our operations. Failure to continue to improve operations would adversely affect
our ability to make principal or interest payments on our debt.
The additional unregistered shares of common stock that we issued may depress
the market price of our common stock because we have agreed to register those
shares under the Securities Act to enable the holders of the shares to sell
them.
We are obligated to register the shares of our common stock that we
issued in various transactions. In addition, we are obligated to register the
61,095,219 shares of our common stock underlying (as of March 31, 2001) the
series B convertible preferred stock that we issued in October 1999 and the
2,500,000
10
shares of our common stock underlying the warrant issued to J.P. Morgan Ventures
Corporation on October 1999. As of May 17, 2001, we have also agreed to register
an aggregate of approximately 111,000,000 shares of our common stock that we
issued or agreed to issue in various debt for equity exchanges. In addition, we
expect to agree to register a significant number of additional shares of our
common stock pursuant to the refinancings of our debt described under "Recent
Event," and we may agree to register additional shares in the future pursuant to
additional refinancings. The possible public sale of such large numbers of
shares may have an adverse effect on the market price of our common stock.
Risks Related to Our Industry
The markets in which we operate are very competitive and further increases in
competition could adversely affect us.
We face intense competition with local, regional and national
companies, including other drug store chains, independent drug stores,
supermarkets and mass merchandisers. We may not be able to effectively compete
against them because our existing or potential competitors may have financial
and other resources that are superior to ours. In addition, we may be at a
competitive disadvantage because we are more highly leveraged than our
competitors. We believe that the continued consolidation of the drugstore
industry will further increase competitive pressures in the industry. As
competition increases, a significant increase in general pricing pressures could
occur which would require us to increase our sales volume and to sell higher
margin products and services in order to remain competitive. We cannot assure
you that we will be able to continue effectively to compete in our markets or
increase our sales volume in response to further increased competition.
Changes in third-party reimbursement levels for prescription drugs could reduce
our margins and have a material adverse effect on our business.
Sales of prescription drugs, as a percentage of sales, have been
increasing and we expect them to continue to increase. In fiscal 2001, we were
reimbursed by third-party payors for approximately 90.3% of all of the
prescription drugs that we sold. These third-party payors could reduce the
levels at which they will reimburse us for the prescription drugs that we
provide to their members. Furthermore, if Medicare is reformed to include
prescription benefits, Medicare may cover some of the prescription drugs that we
now sell at retail prices, and we may be reimbursed at prices lower than our
current retail prices. If third-party payors reduce their reimbursement levels
or if Medicare covers prescription drugs at reimbursement levels lower than our
current retail prices, our margins on these sales would be reduced, and the
profitability of our business and our results of operations and financial
condition could be adversely affected.
We are subject to governmental regulations, procedures and requirements; our
noncompliance or a significant regulatory change could hurt our business, the
results of our operations or our financial condition.
Our pharmacy business is subject to federal, state, and local
regulation. These include local registrations of pharmacies in the states where
our pharmacies are located, applicable Medicare and Medicaid regulations, and
prohibitions against paid referrals of patients. Failure to properly adhere to
these and other applicable regulations could result in the imposition of civil
and criminal penalties and could adversely affect the continued operation of our
business. Furthermore, our pharmacies could be affected by federal and state
reform programs, such as health care reform initiatives which could, in turn,
negatively affect our business. The passing of these initiatives or any new
federal or state programs could adversely affect our business and our results of
operations and financial condition.
Certain risks are inherent in the provision of pharmacy services; our insurance
may not be adequate to cover any claims against us.
11
Pharmacies are exposed to risks inherent in the packaging and
distribution of pharmaceuticals and other health care products. Although we
maintain professional liability and errors and omissions liability insurance, we
cannot assure you that the coverage limits under our insurance programs will be
adequate to protect us against future claims, or that we will maintain this
insurance on acceptable terms in the future.
Any adverse change in general economic conditions can adversely affect
consumer-buying practices and reduce our sales of front-end products, which are
our higher margin products.
If the economy slows down and unemployment increases or inflationary
conditions worry consumers, our consumers may decrease their purchases,
particularly of products other than pharmaceutical products that they need for
health reasons. We make a higher profit on our sales of front-end products than
we do on sales of pharmaceutical products. Therefore, any decrease in our sales
of front-end products will decrease our profitability.
12
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This registration statement includes forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are identified by terms and phrases such as
"anticipate," "believe," "intend," "estimate," "expect," "continue," "should,"
"could," "may," "plan," "project," "predict," "will" and similar expressions and
include references to assumptions and relate to our future prospects,
developments and business strategies.
Factors that could cause actual results to differ materially from those
expressed or implied in such forward-looking statements include, but are not
limited to:
o our high level of indebtedness;
o our ability to make interest and principal payments on our debt and
satisfy the other covenants contained in our credit facilities and
other debt agreements;
o our ability to complete the financial restructuring contemplated by
our May 15, 2001 bank commitment letter;
o our ability to improve the operating performance of our existing
stores, and, in particular, our new and relocated stores in
accordance with our management's long term strategy;
o the outcomes of pending lawsuits and governmental investigations,
both civil and criminal, involving our financial reporting and other
matters;
o competitive pricing pressures, continued consolidation of the
drugstore industry, third-party prescription reimbursement levels,
regulatory changes governing pharmacy practices, general economic
conditions and inflation, interest rate movements, access to capital
and merchandise supply constraints; and
o our ability to further develop, implement and maintain reliable and
adequate internal accounting systems and controls.
We undertake no obligation to revise the forward-looking statements
included in this registration statement to reflect any future events or
circumstances. Our actual results, performance or achievements could differ
materially from the results expressed in, or implied by, these forward-looking
statements. Factors that could cause or contribute to such differences are
discussed in this registration statement under the section entitled "Risk
Factors" herein.
13
USE OF PROCEEDS
The Company will not realize any proceeds from the sale of the Common
Stock which may be sold pursuant to this prospectus for the respective accounts
of the Selling Stockholders. The Company, however, will derive proceeds from the
exercise of the options. All such proceeds will be available to the Company for
working capital and general corporate purposes. No assurances can be given,
however, as to when or if any or all of the Options will be exercised.
SELLING STOCKHOLDERS
The following table sets forth information with respect to the
beneficial ownership of Selling Stockholders based upon corporate records of the
Company as of May 21, 2001. At May 14, 2001, the number of shares outstanding
was 394,341,787.
The inclusion in the table of any of the Selling Stockholders shall not
be deemed to be admission that any such individuals are "affiliates" of the
Company.
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
Percentage of
Number of Shares to Outstanding Shares
Number of Shares Maximum Number of be Beneficially Owned to be Owned if All
Name of Selling Beneficially Owned Shares which may be if All Shares Offered Shares Offered
Stockholder (1) Prior to Offering Sold Hereunder Hereby are Sold (2) Hereby are Sold (2)
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
17 Selling Stockholders 922,567 2,115,465 1,192,898 *
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
- ---------------
* Represents beneficial ownership of less than one percent.
(1) Each of the selling stockholders have been employed with the Company within
the past three years.
(2) Beneficial ownership is determined in accordance with the Commission's
rules and generally includes voting or investment power with respect to the
securities. Under the Commission's rules, shares of common stock subject to
options and warrants which are currently exercisable, or will become
exercisable within 60 days of May 23, 2001 are deemed outstanding for
computing the percentage of the person or entity holding such securities
but are not outstanding for computing the percentage of any other person or
entity.
14
PLAN OF DISTRIBUTION
The selling stockholders may sell shares of Common Stock from time to
time directly by or on behalf of the Selling Stockholder in one or more
transactions on the New York Stock Exchange, Pacific Stock Exchange or on any
stock exchange on which the Common Stock may be listed at the time of sale, in
privately negotiated transactions, or through a combination of such methods, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices, at fixed prices or at negotiated prices. The Selling
Stockholders may sell shares through one or more agents, brokers or dealers or
directly to purchasers. Such brokers or dealers may receive compensation in the
form of commissions, discounts or concessions from the Selling Stockholders
and/or purchasers of the shares or both. Such compensation as to a particular
broker or dealer may be in excess of customary commissions.
In connection with their sales, the Selling Stockholders and any
participating broker or dealer may be deemed to be "underwriters" within the
meaning of the Securities Act, and any commissions they receive and the proceeds
of any sale of shares may be deemed to be underwriting discounts and commissions
under the Securities Act.
LEGAL MATTERS
The legality of the Common Stock which is registered for reoffer and
resale has been passed upon for the Company by Elliot S. Gerson, Esq., Senior
Executive Vice President and General Counsel of Rite Aid Corporation.
EXPERTS
The financial statements of the Company and its consolidated
subsidiaries, except PCS Holding Corporation and subsidiaries which has been
included in discontinued operations in such consolidated financial statements,
as of March 3, 2001 and February 26, 2000, and for each of the three years in
the period ended March 3, 2001, incorporated in this Registration Statement by
reference, have been audited by Deloitte & Touche LLP as stated in their report
which is incorporated herein by reference. The financial statements of PCS
Holding Corporation and subsidiaries for the years ended February 26, 2000 and
the thirty-six days ended February 27, 1999, not separately incorporated in this
Registration Statement by reference herein, have been audited by Ernst & Young
LLP, as stated in their report, which is incorporated herein by reference. Such
financial statements of the Company and its consolidated subsidiaries are
included herein in reliance upon the respective reports of such firms given upon
their authority as experts in accounting and auditing. All of the foregoing
firms are independent auditors.
15
Rite Aid Corporation
No dealer, salesperson or any other person has been authorized to give
any information or make any representations not contained in this prospectus. If
given or made, such information or representations must not be relied upon as
having been authorized by the Company or any underwriter. This prospectus does
not constitute an offer to sell or a solicitation of an offer to buy any
securities in any jurisdiction in which such offer or solicitation of an offer
to buy any securities in any jurisdiction in which such offer or solicitation
would be unlawful or to any person to whom it 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 the
Company since the date hereof or that any information contained herein is
correct as of any time subsequent to its date.
The date of this Reoffer Prospectus is May 25, 2001
16
PART II
Item 3. Incorporation of Documents by Reference
The following documents, which have been filed with the Commission
pursuant to the Exchange Act, are hereby incorporated by reference in, and shall
be deemed to be a part of, this Registration Statement:
o The Company's Annual Report on Form 10-K for the year ended March 3,
2001, filed May 21, 2001; and
o The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, dated July 18, 1991,
filed by the Company to register such securities under the Exchange
Act, including all amendments and reports filed for the purpose of
updating such description.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act prior to the filing of a post-effective
amendment which indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold are incorporated by reference
in this Registration Statement. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Registration Statement to the
extent that a statement contained herein, or in any subsequently filed document
which also is or is deemed to be incorporated by reference herein, modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute part of this
Registration Statement.
Item 4. Description of Securities
Not required to be filed with this Registration Statement.
Item 5. Interest of Named Experts and Counsel
Not applicable.
Item 6. Indemnification of Directors and Officers
Under Section 145 of the Delaware General Corporation Law ("DGCL"), a
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 (other than
an action by or in the right of the corporation) by reason of the fact that he
or she 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 (i) if such person acted in
good faith and in a manner that person reasonably believed to be in or not
opposed to the best interests of the corporation and (ii) with respect to any
criminal action or proceeding, if he or she had no reasonable cause to believe
such conduct was unlawful. In actions brought by or in the right of the
corporation, a corporation may indemnify such person against expenses (including
attorneys' fees) actually and reasonably incurred by such person in connection
with the defense or settlement of such action or suit if such person acted in
good faith and in a manner that person reasonably believed to be in or not
opposed
17
to the best interests of the corporation, except that no indemnification may be
made in respect of any claim, issue or matter as to which that person shall have
been adjudged to be liable to the corporation unless and only to the extent that
the Court of Chancery of the State of Delaware or the court in which such action
or suit was brought shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnification for such expenses
which the Court of Chancery or other such court shall deem proper. To the extent
that such person has been successful on the merits or otherwise in defending any
such action, suit or proceeding referred to above or any claim, issue or matter
therein, he or she is entitled to indemnification for expenses (including
attorneys' fees) actually and reasonably incurred by such person in connection
therewith. The indemnification and advancement of expenses provided for or
granted pursuant to Section 145 is not exclusive of any other rights of
indemnification or advancement of expenses to which those seeking
indemnification or advancement of expenses may be entitled, and a corporation
may purchase and maintain insurance against liabilities asserted against any
former or current director, officer, employee or agent of the corporation, or a
person who 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, whether or not the power to indemnify is provided by
the statute.
Article Tenth of the Company's Certificate of Incorporation and Article
VII of the Company's By-laws provide for the indemnification of its directors
and officers as authorized by Section 145 of the DGCL.
The directors and officers of the Company and its subsidiaries are
insured (subject to certain exceptions and deductions) against liabilities which
they may incur in their capacity as such including liabilities under the
Securities Act, under liability insurance policies carried by the Company.
Item 7. Exemption from Registration Claimed
The restricted securities to be reoffered and resold pursuant to this
Registration Statement were issued under the 1990 Omnibus Stock Incentive Plan,
the 2000 Omnibus Equity Plan and individual employment agreements and in
transactions exempt from registration pursuant to Section 4(2) of the Securities
Act.
Item 8. Exhibits
Exhibit No. Description
----------- -----------
4.1* 1990 Omnibus Stock Incentive Plan
4.2** 1999 Stock Option Plan
4.3*** 2000 Omnibus Equity Plan
4.4** 2001 Stock Option Plan
4.5 Employment Agreement by and between Rite Aid Corporation and Don Davis, made
as of January 28, 2000
4.6** Employment Agreement by and between Rite Aid Corporation and Christopher Hall
4.7**** Rite Aid Corporation Restricted Stock and Stock Option Award Agreement, made as
of December 5, 1999, by and between Rite Aid Corporation and David Jessick
4.8 Employment Agreement by and between Rite Aid Corporation and Keith Lovett,
made as of May 1, 2000
4.9**** Rite Aid Corporation Restricted Stock and Stock Option Award Agreement, made as
of December 5, 1999, by and between Rite Aid Corporation and Robert G. Miller.
4.10**** Rite Aid Corporation Restricted Stock and Stock Option Award Agreement, made as
of December 5, 1999, by and between Rite Aid Corporation and Mary F. Sammons.
4.11**** Rite Aid Corporation Restricted Stock and Stock Option Award Agreement, made as
of December 5, 1999, by and between Rite Aid Corporation and John T. Standley.
18
Exhibit No. Description
----------- -----------
4.12 Employment Agreement by and between Rite Aid Corporation and Marty Tassoni,
made as of March 15, 2000
4.13 Employment Agreement by and between Rite Aid Corporation and Murray Todd,
made as of March 6, 2000
5.1 Opinion of Counsel
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Ernst & Young LLP
24.1 Power of Attorney (included on signature page)
- ------------
* Incorporated by reference from the Company's Form S-8, filed on
July 12, 1996.
** Incorporated by reference from the Company's Annual Report on Form 10-K,
filed on May 21, 2001.
*** Incorporated by reference from the Company's Annual Report on Form 10-K,
filed on July 11, 2000.
**** Incorporated by reference from the Company's Definitive Proxy Statement on
Schedule 14A, filed on October 24, 2000.
Item 9. Undertakings
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the 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, the 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 Act and will be governed by the final adjudication of
such issue.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the Registration Statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in
the Registration Statement or any material change to
such information in the Registration Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a post-effective amendment
by these paragraphs is contained in periodic reports filed by
19
the registrant pursuant to Section 13 or Section 15(d) of the Securities and
Exchange Act of 1934 that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment
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.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
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 that is incorporated by reference in the Registration
Statement shall be deemed to be a new Registration Statement relating to the
securities offered herein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
20
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Camp Hill, Pennsylvania, on this 23rd day of May, 2001.
RITE AID CORPORATION
By: /s/ Robert G. Miller
--------------------------------------
Name: Robert G. Miller
Title: Chairman of the Board of Directors
and Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned officers and directors of Rite Aid Corporation and
each of us, do hereby constitute and appoint Elliot S. Gerson and Christopher
Hall jointly, as our true and lawful attorneys and agents, with full power of
substitution and resubstitution, to do any and all acts and things in our name
and behalf in any and all capacities and to execute any and all instruments for
us in our names, in connection with this Registration Statement or any
registration statement for the same offering that is to be effective upon filing
pursuant to Rule 462(b) under the Securities Act of 1933, and to file the same,
with all exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, including specifically, but without
limitation, power and authority to sign for us or any of us in our names in the
capacities indicated below, any and all amendments (including post-effective
amendments) hereto; and we hereby ratify and confirm all that said attorneys and
agents, or their substitutes, shall do or cause to be done by virtue thereof.
21
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed below by the following persons in
the capacities and on the dates indicated:
Signatures Title Date
---------- ----- ----
/s/ Robert G. Miller Chairman of the Board of May 23, 2001
- ------------------------------------------- Directors and Chief Executive
Robert G. Miller Officer)
/s/ Mary F. Sammons President, Chief Operating May 23, 2001
- ------------------------------------------- Officer, and Director
Mary F. Sammons
/s/ John T. Standley Chief Financial Officer and May 23, 2001
- ------------------------------------------- Senior Executive Vice President
John T. Standley
/s/ Kevin Twomey Chief Accounting Officer and May 23, 2001
- ------------------------------------------- Senior Vice President
Kevin Twomey
/s/ William J. Bratton Director May 23, 2001
- -------------------------------------------
William J. Bratton
/s/ Alfred M. Gleason Director May 23, 2001
- -------------------------------------------
Alfred M. Gleason
/s/ Leonard I. Green Director May 23, 2001
- -------------------------------------------
Leonard I. Green
/s/ Nancy A. Lieberman Director May 23, 2001
- -------------------------------------------
Nancy A. Lieberman
/s/ Stuart M. Sloan Director May 23, 2001
- -------------------------------------------
Stuart M. Sloan
/s/ Jonathan D. Sokoloff Director May 23, 2001
- -------------------------------------------
Jonathan D. Sokoloff
/s/ Leonard Stern Director May 23, 2001
- -------------------------------------------
Leonard N. Stern
/s/ Gerald Tsai, Jr. Director May 23, 2001
- -------------------------------------------
Gerald Tsai, Jr.
22
INDEX TO EXHIBITS
Exhibit No. Description
----------- ------------
4.1* 1990 Omnibus Stock Incentive Plan
4.2** 1999 Stock Option Plan
4.3*** 2000 Omnibus Equity Plan
4.4** 2001 Stock Option Plan
4.5 Employment Agreement by and between Rite Aid Corporation and Don Davis, made
as of January 28, 2000
4.6** Employment Agreement by and between Rite Aid Corporation and Christopher Hall
4.7**** Rite Aid Corporation Restricted Stock and Stock Option Award Agreement, made as
of December 5, 1999, by and between Rite Aid Corporation and David Jessick
4.8 Employment Agreement by and between Rite Aid Corporation and Keith Lovett,
made as of May 1, 2000
4.9**** Rite Aid Corporation Restricted Stock and Stock Option Award Agreement, made as
of December 5, 1999, by and between Rite Aid Corporation and Robert G. Miller.
4.10**** Rite Aid Corporation Restricted Stock and Stock Option Award Agreement, made as
of December 5, 1999, by and between Rite Aid Corporation and Mary F. Sammons.
4.11**** Rite Aid Corporation Restricted Stock and Stock Option Award Agreement, made as
of December 5, 1999, by and between Rite Aid Corporation and John T. Standley.
4.12 Employment Agreement by and between Rite Aid Corporation and Marty Tassoni,
made as of March 15, 2000
4.13 Employment Agreement by and between Rite Aid Corporation and Murray Todd,
made as of March 6, 2000
5.1 Opinion of Counsel
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Ernst & Young LLP
24.1 Power of Attorney (included on signature page)
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* Incorporated by reference from the Company's Form S-8, filed on
July 12, 1996.
** Incorporated by reference from the Company's Annual Report on Form 10-K,
filed on May 21, 2001.
*** Incorporated by reference from the Company's Annual Report on Form 10-K,
filed on July 11, 2000.
**** Incorporated by reference from the Company's Definitive Proxy Statement on
Schedule 14A, filed on October 24, 2000.
23