Rite Aid Corporation (NYSE: RAD) today provided an update on its
previously announced debt refinancing transactions that would extend the
maturity of a portion of its outstanding indebtedness and lower interest
expense. The refinancing transactions are now expected to include:
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the amendment and restatement of Rite Aid’s existing revolving credit
facility;
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the refinancing of Rite Aid’s $1.039 billion Tranche 2 Term Loan due
2014 and a cash tender offer for Rite Aid’s $410.0 million aggregate
principal amount of 9.750% Senior Secured Notes due 2016 with the
proceeds of a new $1.125 billion first lien term loan, together with
borrowings under the amended revolving credit facility. Rite Aid has
currently received signed commitments for a $1.5 billion revolving
credit facility. To the extent that Rite Aid receives additional
commitments for the revolving credit facility, these proceeds will be
used to prepay a portion of its $331.7 million Tranche 5 Term Loan due
2018;
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a cash tender offer for Rite Aid’s $470.0 million aggregate principal
amount of 10.375% Senior Secured Notes due 2016 with the proceeds from
a new $470 million second lien term loan,together with borrowings
under the amended revolving credit facility ; and
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a cash tender offer for Rite Aid’s $180.3 million aggregate principal
amount of 6.875% Senior Debentures due 2013 with available cash.
These refinancing transactions are subject to customary terms and
conditions. Rite Aid’s results of operations and guidance will likely be
impacted by fees, expenses and charges related to the refinancing
transactions.
Rite Aid intends to redeem any 9.750% Notes and 10.375% Notes not
tendered in the tender offers and related consent solicitations. Rite
Aid intends to satisfy and discharge any 6.875% Debentures that remain
outstanding after the tender offer and consent solicitation. Holders of
untendered 6.875% Debentures that are satisfied and discharged will
continue to receive regular interest payments and repayment of their
6.875% Debentures will be made at maturity on Aug. 15, 2013.
This press release does not constitute a notice of redemption under the
optional redemption provisions of the indenture governing any series of
the Notes, nor does it constitute an offer to sell, or a solicitation of
an offer to buy, any security. No offer, solicitation, or sale will be
made in any jurisdiction in which such an offer, solicitation, or sale
would be unlawful.
Requests for documents relating to each tender offer and consent
solicitation may be directed to Global Bondholder Services Corp., the
Information Agent, at (866) 804-2200 or (212) 430-3774 (banks and
brokers). Citigroup will act as Dealer Manager and Solicitation Agent
for each tender offer and consent solicitation. Questions regarding each
tender offer and consent solicitation may be directed to Citigroup at
(800) 558-3745 (toll free) or (212) 723-6106 (collect).
Rite Aid is one of the nation’s leading drugstore chains with 4,626
stores in 31 states and the District of Columbia and fiscal 2012 annual
revenues of $26.1 billion.
Statements in this release that are not historical are
forward-looking statements made pursuant to the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995. Words such as
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,”
“intend,” “may,” “plan,” “predict,” “project,” “should,” and “will” and
variations of such words and similar expressions are intended to
identify such forward-looking statements. These forward-looking
statements are not guarantees of future performance and involve risks,
assumptions and uncertainties, including, but not limited to, our high
level of indebtedness and our ability to make interest and principal
payments on our debt and satisfy the other covenants contained in our
debt agreements, general economic, market and competitive conditions,
our ability to improve the operating performance of our stores in
accordance with our long term strategy, the continued efforts of private
and public third-party payers to reduce prescription drug reimbursements
and encourage mail order and limit access to payor networks, the ability
to realize anticipated results from capital expenditures and cost
reduction initiatives, outcomes of legal and regulatory matters and
changes in legislation or regulations, including healthcare reform.
These and other risks, assumptions and uncertainties are described in
Item 1A (Risk Factors) of our most recent Annual Report on Form 10-K and
in other documents that we file or furnish with the Securities and
Exchange Commission, which you are encouraged to read. Should one or
more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from
those indicated or anticipated by such forward-looking statements.
Accordingly, you are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date they are
made. Rite Aid expressly disclaims any current intention to update
publicly any forward-looking statement after the distribution of this
release, whether as a result of new information, future events, changes
in assumptions or otherwise.