Rite Aid gets needed consents for 8 1/8%, 9¼%, 7½% notes, prices 7½% notes

By Susanna Moon

Chicago, June 18 - Rite Aid Corp. said it received the required consents for its 8 1/8% senior secured notes due 2010, 9¼% senior notes due 2013 and 7½% senior secured notes due 2015.

The company also said it priced its tender offer for the 7½% notes at $1,095.80 for each $1,000 principal amount of the 7½% notes.

As of 5 p.m. ET on June 17, Rite Aid received $344.1 million principal amount, or 95.58%, of the 2010 notes, $142.84 million principal amount, or 95.23%, of the 2013 notes and $199.49 million principal amount, or 99.74%, of the 2015 notes.

As a result of receiving consents from holders of a majority of the notes, Rite Aid and some subsidiaries entered into supplemental indentures dated as of June 17 among Rite Aid, the subsidiary guarantors and Bank of New York Trust Co., NA.

As part of its tender offer for the three series of notes, Rite Aid sought the consents for some proposed amendments that would eliminate or modify substantially all restrictive covenants, some events of default and other provisions contained in the indentures governing the notes, release the subsidiary guarantees and release all the collateral securing the obligations of the subsidiary guarantors under the 8 1/8% notes and 7½% notes.

The consent deadline was 5 p.m. ET on June 17. The offer will end at midnight ET on July 1. It began on June 4.

As previously reported, the company said it would pay $1,024.06 for the 8 1/8% notes and $1,000 for the 9¼% notes.

Rite Aid calculated the payout for the 7½% notes at 2 p.m. ET on June 18 using a fixed spread of 75 basis points over the yield to maturity of the 3 5/8% Treasury due Jan. 15, 2010.

Payouts include a $20.00 consent payment for those who tendered by the early deadline.

Rite Aid noted that it will also pay accrued interest.

The offer is conditioned upon the receipt of debt financing sufficient to pay the total consideration and related fees and expenses.

Global Bondholder Services Corp. (866 488-1500 or 212 430-3774) is the depositary and information agent, and Citi (800 558-3745 or 212 723-6106) is the dealer manager.

Rite Aid is a drugstore chain based in Camp Hill, Pa.

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