New Issue: Rite Aid prices $410 million 9¾% seven-year notes at 98.196 to yield 10 1/8%

By Paul A. Harris

St. Louis, June 8 - Rite Aid Corp. priced a slightly upsized $410 million issue of 9¾% seven-year first-lien senior secured notes (B3/B+) at 98.196 to yield 10 1/8% on Monday.

The quickly shopped deal, which was upsized from $400 million, priced in the middle of the 10% to 10¼% yield talk and came in line with price talk that had the notes pricing at a small discount.

Citigroup Global Markets Inc., Banc of America Securities LLC and Wachovia Securities LLC were joint bookrunners.

Proceeds will be used to refinance the Camp Hill, Pa.-based drugstore company's outstanding debt.

Issuer:	Rite Aid Corp.
Face amount:	$410 million
Proceeds:	$402.604 million (approximate)
Maturity:	June 12, 2016
Security description:	First-lien senior secured notes
Bookrunners:	Citigroup Global Markets Inc., Banc of America Securities LLC, Wachovia Securities LLC
Coupon:	9¾%
Price:	98.196
Yield:	10 1/8%
Call protection:	Make-whole at Treasuries plus 75 bps until June 12, 2013, then callable at 104.875, 102.438, par on and after June 12, 2015
Equity clawback:	Until June 12, 2012 for 35% at 109.75
Trade date:	June 8
Settlement date:	June 12
Ratings:	Moody's: B3
	Standard & Poor's: B+
Distribution:	Rule 144A with registration rights
Price talk:	10% to 10¼% at a small discount

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