REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made
and entered into as of June 27, 2001, by and between RITE AID CORPORATION, a
Delaware corporation (the "Company"), TRANSAMERICA INVESTMENT MANAGEMENT, LLC
("Transamerica") and the Other Purchasers (as defined below and, together with
Transamerica, the "Purchasers").
W I T N E S S E T H:
WHEREAS, the Company has agreed to issue and sell to the
Purchasers the Purchase Shares (as defined below) in accordance with the terms
of a Stock Purchase Agreement between the Company and Transamerica dated as of
the date hereof (the "Purchase Agreement");
WHEREAS, in connection with the sale of the Purchase Shares to
the Purchasers, the Company has agreed to provide the Purchasers with the
registration rights set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and
undertakings contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and subject to and
on the terms and conditions herein set forth, the parties hereto hereby agree as
follows:
ARTICLE I
Certain Definitions
As used in this Agreement, the following terms shall have the
meanings ascribed to them below:
1.1 "Blackout Period" shall have the meaning set forth in
Section 2.1(d).
1.2 "Commission" shall mean the Securities and Exchange
Commission or any federal agency at the time administering the Securities Act.
1.3 "Common Stock" shall mean the common stock of the Company,
par value $1.00 per share.
1.4 "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, or any federal statute then in effect which has replaced such
statute.
1.5 "Filing Deadline" shall mean the date the Company is
obligated to file a registration statement pursuant to Section 2.1(a).
1.6 "Holder" shall mean each Purchaser for so long as it owns
any Registrable Securities and any other Person who is a Holder or beneficial
owner of Registrable Securities for so long as such Person holds or beneficially
owns any Registrable Securities.
1.7 "Other Purchasers" shall mean certain funds internal to
Transamerica, not yet identified, to be designated by Transamerica by written
notice delivered to the Company on or prior to the second business day
immediately preceding the Closing Date (as defined in the Purchase Agreement),
and which will execute a counterpart to this Agreement.
1.8 "Person" shall mean an individual, corporation, limited
liability company, joint venture, partnership, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
other entity that may be treated as a person under applicable law.
1.9 "Purchase Shares" shall mean the shares of Common Stock
purchased by the Purchasers pursuant to the Stock Purchase Agreement.
1.10 "Registrable Securities" shall mean the Purchase Shares,
provided that such securities shall cease to be Registrable Securities when (i)
a registration statement registering such Registrable Securities under the
Securities Act has been declared or becomes effective and such Registrable
Securities have been sold or otherwise transferred by the Holder thereof
pursuant to such effective registration statement; (ii) such Registrable
Securities are sold pursuant to Rule 144 under circumstances in which any legend
borne by such Registrable Securities relating to restrictions on the
transferability thereof, under the Securities Act or otherwise, is removed by
the Company or such Registrable Securities are eligible to be sold pursuant to
paragraph (k) of Rule 144; or (iii) such Registrable Securities shall cease to
be outstanding.
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1.11 "Rule 144" shall mean Rule 144 promulgated under the
Securities Act.
1.12 "Securities Act" shall mean Securities Act of 1933, as
amended, or any federal statute then in effect which has replaced such statute.
1.13 "Shelf Registration Statement" shall have the meaning
set forth in Section 2.1(a).
ARTICLE II
Registration Rights
2.1 Shelf Registration
(a) The Company will use its best efforts to
prepare and file with the Commission, as soon as practicable, but in any event,
no later than the date that is thirty (30) days after the Closing Date (as such
term is defined in the Purchase Agreement) a shelf registration statement on
Form S-1 or any other appropriate form (it being understood by all parties that
the Company will not be eligible to use Form S-3 prior to October 11, 2001)
under Rule 415 of the Securities Act, or any similar rule that may be adopted by
the Commission relating to the offer and sale of the Registrable Securities by
the Holders from time to time in accordance with the methods of distribution
elected by such Holders and set forth in such shelf registration statement
(together with all amendments and supplements to such registration statement,
including post-effective amendments, in each case including the prospectus
contained therein, all exhibits thereto and all material incorporated by
reference thereto, the "Shelf Registration Statement"), provided that the
Company may also register for sale on its own account or that of any other
holder of equity securities of the Company pursuant to the Shelf Registration
Statement such additional shares of the Company's stock as it shall desire.
(b) The Company will use its reasonable best
efforts to cause the registration statement filed pursuant to Section 2.1(a) to
be declared effective and, subject to Section 2.1(d), to remain effective for a
period ending on the earlier of (i) the date two years after the effective date
of the Registration Statement and (ii) the date on which there cease to be any
Registrable Securities outstanding.
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(c) Each Holder of Registrable Securities that
wishes to sell Registrable Securities pursuant to a Shelf Registration Statement
and related prospectus agrees to deliver a notice and questionnaire in the form
attached hereto as Exhibit A (a "Notice and Questionnaire") at least three (3)
business days prior to the intended distribution of Registrable Securities under
the Shelf Registration Statement. Provided that the Shelf Registration
Statement has been declared effective, the Company shall, as promptly as is
practicable after a Holder has delivered a Notice and Questionnaire and such
other information as the Company may reasonably require, (i) if required by
applicable law, file with the Commission a post-effective amendment to the Shelf
Registration Statement or prepare and, if required by applicable law, file a
supplement to the related prospectus or amendment to any document incorporated
therein by reference or file any other required document so that such Holder is
named as a selling security holder in the Shelf Registration Statement and the
related prospectus in such a manner as to permit such Holder to deliver such
prospectus to the purchaser of the Registrable Securities in accordance with
applicable law and, if the Company shall file a post-effective amendment to the
Shelf Registration Statement, use its best efforts to cause such post-effective
amendments to be declared effective under the Act as promptly as is
practicable, (ii) provide such Holder with such number of copies of any
documents filed pursuant to the foregoing as the Holder shall reasonably request
and (iii) notify such Holder as promptly as practicable after the effectiveness
of any post-effective amendment filed hereunder provided, however, that if the
Notice and Questionnaire is delivered during a Blackout Period, the Company
shall so inform the Holder delivering such Notice and Questionnaire and shall
take the actions set forth in clauses (i), (ii) and (iii) above upon expiration
of the Blackout Period in accordance with Section 2.1(d) hereof.
(d) Notwithstanding anything to the contrary
contained in this Agreement, the Company shall have the right to delay the
effectiveness of the Shelf Registration Statement or to suspend, after the lapse
of a period of sixty (60) days after the effective date of such Shelf
Registration Statement, the right of a Holder to sell Registrable Securities
under an effective Shelf Registration Statement, during no more than (2) periods
aggregating to not more than seventy-five (75) days in any twelve-month period
(a "Blackout Period") in the event that (i) (a) the Company would, in
accordance with the reasonable advice of its counsel, be required to disclose in
the prospectus, information not otherwise required by law to be publicly
disclosed, and (b) in the reasonable judgment of the Board of Directors of the
Company, there is a reasonable likelihood that such disclosure, or any other
action to be taken in connection with the prospectus, would materially and
adversely affect or interfere with any financing, acquisition, merger, material
joint venture, disposition
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of assets (not in the ordinary course of business), corporate reorganization or
other similar transaction involving the Company, or (ii) a change to the Shelf
Registration Statement is required so that, as of such date, the Shelf
Registration Statement and prospectus do not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, provided, however, that
during any such Blackout Period, the Company shall also delay the filing or
effectiveness of any registration statement with respect to any securities of
the Company or any other shareholder of the Company. The Company shall promptly
give the Holders written notice of such determination containing a general
statement of the reasons for such postponement and an approximation of the
anticipated delay; and provided further, however, that the implementation of any
Blackout Period shall be done in good faith, and not for the purpose or
intention of impeding such rights. Notwithstanding anything to the contrary
contained in this Section 2.1(d), the Company may cause one or more additional
Blackout Periods (each, an "Additional Blackout Period"), in order to file a
post effective amendment to the Shelf Registration Statement to: (i) include and
update the Company's financial statements for the Company's first fiscal quarter
ending June 2, 2001, which post effective amendment will be filed with the
Commission not later than the three (3) business days following the date the
Company files its Quarterly Report on Form 10-Q for such quarter with the
Commission, and (ii) include and update the Company's financial statements for
the Company's second quarter ending September 1, 2001, which post effective
amendment will be filed with the Commission not later than the three (3)
business days following the date the Company files its Quarterly Report on Form
10-Q for such quarter with the Commission. No Additional Blackout Period shall
count against the Blackout Periods permitted above, provided, that, the
Commission declares the post effective amendment which resulted in the
Additional Blackout Period effective not later than the twentieth (20) day
following the date the Company files such post effective amendment with the
Commission. In the event the Commission does not declare any such post effective
amendment effective within such twenty-day period, then such Additional Blackout
Period shall count as a Blackout Period.
(e) The Holders may elect to sell Registrable
Securities in an underwritten offering in accordance with the conditions set
forth in this Section 2.1(e). In any such underwritten offering, the investment
banker or bankers and manager or managers that will administer the offering will
be selected by, and the underwriting arrangements with respect thereto will be
approved by a majority in interest of the Holders, subject, in each case, to the
consent of the Company, which consent will not be unreasonably withheld, and the
Holders will be responsible for all underwriting commissions and discounts with
respect to the Purchase Shares sold by
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such Holder, in connection therewith. The Company shall not be obligated to
arrange for more than one underwritten offering pursuant to the Shelf
Registration Statement. No Holder may participate in any underwritten offering
hereunder unless the Holder (i) agrees to sell the Holder's Registrable
Securities on the basis provided in any underwriting arrangements approved
pursuant hereto and (ii) completes and executes all other questionnaires, powers
of attorney, indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements.
2.2 Piggyback Registration.
(a) If (i) the Company has not filed the Shelf
Registration Statement, or (ii) the Company is no longer obligated to maintain
the effectiveness of the Shelf Registration Statement pursuant to Section 2.1(b)
above and the Holder holds or beneficiary owns at least one percent (1%) of the
Company's outstanding Common Stock, and (iii) the Company shall determine to
register any equity securities of the Company for its own account or for the
account of other holders of equity securities of the Company on any registration
form (other than Form S-4 or S-8 or other successor forms) which permits the
inclusion of Registrable Securities held by any Holder (a "Piggyback
Registration"), then the Company will promptly give each Holder written notice
thereof and, subject to Section 2.2(c), shall include in such registration all
Registrable Securities requested to be included therein pursuant to the written
requests of Holders received within 20 days after delivery of the Company's
notice.
(b) If the Piggyback Registration relates to an
underwritten public offering, the Company shall so advise the Holders as part of
the written notice given pursuant to Section 2.2(a). In such event, the right of
any Holder to participate in such registration shall be conditioned upon such
Holder's participation in such underwriting in accordance with the terms and
conditions thereof. The Board of Directors shall have the right to select the
managing underwriter(s) for any underwritten Piggyback Registration. All
Holders proposing to distribute their Registrable Securities through such
underwriting shall (together with the Company) enter into an underwriting
agreement in customary form.
(c) If such proposed Piggyback Registration is
an underwritten offering and the managing underwriter for such offering advises
the Company that the securities requested to be included therein exceeds the
amount of securities that can be sold in such offering, any securities to be
sold by the Company or other holders of the Company's securities initiating such
offering or otherwise
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contractually entitled to be included in such offering prior to the Holders of
the Registrable Securities shall have priority over any Registrable Securities
held by Holders, and the number of shares to be included by a Holder and other
holders of the Company's securities that did not initiate the offering and not
having priority over the Holders in such registration shall be reduced pro rata
on the basis of the percentage of the then outstanding Registrable Securities
held by each such Holder and all other holders exercising similar registration
rights.
(d) Notwithstanding the provisions of this
Section 2.2, the Company shall have the right at any time after it shall have
given written notice to the Holders pursuant to Section 2.2 (irrespective of
whether a written request for inclusion of any such securities shall have been
made) to elect not to file any such proposed registration statement, or to
withdraw the same after filing but prior to effectiveness.
2.3 Expenses of Registration. All expenses incurred in
connection with the registrations described herein shall be borne by the
Company, including, in the case of an underwritten offering, the fees of one
counsel for all of the Holders of the Registrable Securities of which are being
registered pursuant to such registration statement, up to a maximum of $10,000,
provided that the expenses borne by the Company shall not include the fees or
disbursements of any other adviser of any Holder. All underwriting discounts,
selling commissions and other similar fees relating to Registrable Securities
included in registration statement of the Company shall be borne by the Holders
of such Registrable Securities pro rata on the basis of the amount of
Registrable Securities sold by them.
2.4 Registration Procedures. In the case of each registration
effected by the Company pursuant to this Article II involving the registration
of Registrable Securities, the Company will keep each Holder advised in writing
as to the initiation of such registration and as to the completion thereof. At
its expense, the Company will use its best efforts to:
(a) cause such registration to be declared
effective by the Commission;
(b) as soon as reasonably possible, prepare and
file with the Commission such amendments and supplements to such registration
statement and the prospectus included therein (including post-effective
amendments, prospectus supplements and pricing supplements) as may be
necessary, including in the case of a Shelf Registration Statement such
amendments and supplements as are necessary to effect and maintain the
effectiveness of such registration statement for the period specified in Section
2.1(b);
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(c) provide (i) the Holders of the Registrable
Securities to be included in such registration statement, (ii) the underwriters
(which term, for purposes of this Agreement, shall include a person deemed to be
an underwriter within the meaning of Section 2(11) of the Securities Act) if
any, thereof, (iii) the sales or placement agent therefor, if any, (iv) counsel
for such underwriters or agent, and (v) not more than one counsel for all the
Holders of such Registrable Securities the opportunity to participate in the
preparation of such registration statement, each prospectus included therein or
filed with the Commission, and each amendment or supplement thereto;
(d) (i) register or qualify the Registrable
Securities to be included in such registration statement under such securities
laws or blue sky laws of such jurisdictions as any Holder of such Registrable
Securities and each placement or sales agent, if any, therefor and underwriter,
if any, thereof shall reasonably request, and (ii) take any and all other
actions as may be reasonably necessary or advisable to enable each such Holder,
agent, if any, and underwriter, if any, to consummate the disposition in such
jurisdictions of such Registrable Securities; provided, however, that the
Company shall not be required for any other purpose to (1) qualify as a foreign
corporation in any jurisdiction wherein it would not otherwise be required to
qualify but for the requirements of this Section 2.4(d) or (2) consent to
general service of process or taxation in any such jurisdiction;
(e) furnish such number of prospectuses and
other documents incident thereto, including any amendment of or supplement to
the prospectus, as any Holder from time to time may reasonably request;
(f) promptly notify the selling Holders of
Registrable Securities, the sales or placement agent, if any, therefor and the
managing under writer or underwriters, if any, thereof and confirm such advice
in writing, (i) when such registration statement or the prospectus included
therein or any prospectus amendment or supplement or post-effective amendment
has been filed, and with respect to such registration statement or any
post-effective amendment, when the same has become effective, (ii) of any
comments by the Commission, the Blue Sky or securities commissioner or regulator
of any state with respect thereto or any request by the Commission for
amendments or supplements to such registration statement or prospectus or for
additional information, (iii) of the issuance by the
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Commission of any stop order suspending the effectiveness of such registration
statement or the initiation or threatening of any proceedings for that purpose,
(iv) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Registrable Securities for the sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose, or (v) at any time when a prospectus is required to be delivered under
the Securities Act, that such registration statement, prospectus, prospectus
amendment or supplement or post-effective amendment, or any document
incorporated by reference in any of the foregoing, contains an untrue statement
of a material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein not misleading in light of
the circumstances then existing;
(g) obtain the withdrawal of any order
suspending the effectiveness of such registration statement or any
post-effective amendment thereto at the earliest practicable date;
(h) if requested by any managing underwriter or
underwriters, any placement or sales agent or any Holder of Registrable
Securities, promptly incorporate in a prospectus supplement or post-effective
amendment such information as is required by the applicable rules and
regulations of the Commission and as such managing underwriter or underwriters,
such agent or such Holder specifies should be included therein relating to the
terms of the sale of such Registrable Securities, including, without limitation,
information with respect to the principal amount of Registrable Securities being
sold by such Holder or agent or to any underwriters, the name and description of
such Holder, agent or underwriter, the offering price of such Registrable
Securities and any discount, commission or other compensation payable in respect
thereof, the purchase price being paid therefor by such underwriters and with
respect to any other terms of the offering of the Registrable Securities to be
sold by such Holder or agent or to such underwriters;
(i) furnish to each Holder of Registrable
Securities included in such registration statement, each placement or sales
agent, if any, therefor, each underwriter, if any, thereof and the respective
counsel referred to in Section 2.4(c) an executed copy of such registration
statement, each such amendment and supplement thereto (in each case including
all exhibits thereto and documents incorporated by reference therein) and such
number of copies of such registration statement (excluding exhibits thereto and
documents incorporated by reference therein unless specifically and reasonably
so requested by such Holder, agent or underwriter, as the case may be) and of
the prospectus included in such registration statement (including each
preliminary prospectus and any summary prospectus), in
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conformity with the requirements of the Securities Act; and the Company hereby
consents to the use of such prospectus (including such preliminary and summary
prospectus) and any amendment or supplement thereto by each such Holder and by
any such agent and underwriter, if any, in each case in the form most recently
provided to such party by the Company, in connection with the offering and sale
of the Registrable Securities covered by the prospectus (including such
preliminary and summary prospectus) or any supplement or amendment thereto;
(j) cause all Registrable Securities covered by
such registration to be listed on each securities exchange or inter-dealer
quotation system on which similar securities issued by the Company are then
listed;
(k) provide a transfer agent and registrar for
all Registrable Securities covered by such registration and a CUSIP number for
all such Registrable Securities, in each case not later than the effective date
of such registration;
(l) cooperate with the Holders of Registrable
Securities and the managing underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be sold, which certificates shall not bear any restrictive legends;
(m) in the event that any broker-dealer
registered under the Exchange Act shall underwrite any Registrable Securities or
participate as a member of an underwriting syndicate or selling group or "assist
in the distribution" (within the meaning of the Rules of Conduct (the "Rules of
Conduct") of the National Association of Securities Dealers, Inc. ("NASD")
thereof, whether as a Holder of such Registrable Securities or as an
underwriter, a placement or sales agent or a broker or dealer in respect
thereof, or otherwise use its reasonable best efforts to assist such
broker-dealer in complying with the requirements of such Rules of Conduct,
including, without limitation, by providing such information to such
broker-dealer as may be required in order for such broker-dealer to comply with
the requirements of the Rules of Conduct; and
(n) otherwise comply with all applicable rules
and regulations of the Commission and make available to its security holders, as
soon as reasonably practicable but in no event later than eighteen months after
the effective date of such registration statement, an earnings statement
covering the period of at least twelve months, but not more than 18 months,
beginning with the first month after the effective date of the registration
statement, which earnings statement shall
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satisfy the provisions of Section 11(a) of the Securities Act (including, at the
option of the Company, Rule 158 thereunder).
(o) make available to any Holder the Registrable
Securities of which are being sold in an underwritten offering registered
pursuant to this Agreement, to any underwriter of such sale and to any counsel
retained by such Holder in connection therewith, at reasonable times and places,
all records and documents of the Company that are reasonably pertinent to the
registration statement filed in connection with such sale. The Company shall
cause its officers, directors and employees to supply all information reasonably
requested by such Holder, underwritten or counsel in connection therewith.
2.5 Delivery of Prospectus Supplement. In the event that the
Company would be required, pursuant to Section 2.4(f) above, to notify the
selling Holders of Registrable Securities, the placement or sales agent, if any,
therefor and the managing underwriters, if any, thereof, the Company shall as
soon as reasonably practicable prepare and furnish to each such Holder, to each
placement or sales agent, if any, and to each underwriter, if any, a reasonable
number of copies of a prospectus supplemented or amended so that, as thereafter
delivered to initial purchasers of Registrable Securities, such prospectus shall
not contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading in light of the circumstances then existing. Each Holder of
Registrable Securities agrees that upon receipt of any notice from the Company
pursuant to Section 2.4(f) hereof, such Holder shall forthwith discontinue the
disposition of Registrable Securities pursuant to the registration statement
applicable to such Registrable Securities until such Holder shall have received
copies of such amended or supplemented prospectus, and if so directed by the
Company, such Holder shall deliver to the Company (at the Company's expense) all
copies, other than permanent file copies, then in such Holder's possession of
the prospectus covering such Registrable Securities at the time of receipt of
such notice.
2.6 Furnishing Information by the Holders. The Company may
require each Holder of Registrable Securities as to which any registration is
being effected to furnish to the Company such information regarding such Holder
and such Holder's intended method of distribution of such Registrable Securities
as the Company may from time to time request in writing. Each such Holder agrees
to promptly notify the Company of any inaccuracy or change in information
previously furnished by such Holder to the Company or of the occurrence of any
event in either case as a result of which any prospectus relating to such
registration contains or would contain an untrue statement of a material fact
regarding such Holder or such
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Holder's intended method of distribution of such Registrable Securities or omits
to state any material fact regarding such Holder or such Holder's intended
method of distribution of such Registrable Securities required to be stated
therein or necessary to make the statements therein not misleading in light of
the circumstances then existing, and promptly to furnish information so required
so that such prospectus shall not contain, with respect to such Holder or the
distribution of such Registrable Securities, an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the circumstances
then existing.
2.7 Indemnification.
(a) The Company will indemnify each Holder whose
Registrable Securities are to be included in a registration pursuant to this
Article II, each of such Holder's officers, directors, partners, agents,
employees and representatives and each person controlling such Holder within
the meaning of Section 15 of the Securities Act, with respect to each
registration, qualification or compliance effected pursuant to this Article II,
against all expenses, claims, losses, damages and liabilities (or actions,
proceedings or settlements in respect thereof) arising out of or based on any
untrue statement or alleged untrue statement of a material fact con tained in
any registration statement, any amendment thereto, or other document
incorporated by reference therein, or compliance, or any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arising out of any
untrue statement or alleged untrue statement of a material fact contained in any
prospectus, or any amendment thereto, or any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading in light of the circumstances in which
they were made, and will reimburse each such indemnified person for any
reasonable legal and other expenses reasonably incurred in connection with
investigating and defending or settling any such claim, loss, damage, liability
or action; provided, however, that the Company will not be liable in any such
case to a Holder to the extent that any such claim, loss, damage, liability or
expense arises out of or is based on any untrue statement or alleged untrue
statement or omission or alleged omission based upon information furnished in
writing to the Company by such Holder and provided for use in such registration
statement, prospectus, offering circular or other document or the Holder
delivered a registration or prospectus in violation of Section 2.5 hereof after
notice was provided by the Company as provided in Section 2.5. It is agreed that
the indemnity agreement contained in this Section 2.7(a) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without
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the consent of the Company (which consent shall not be unreasonably withheld or
delayed).
(b) Each Holder whose Registrable Securities are
included in any registration effected pursuant to this Article II shall
indemnify the Company, each of its directors, officers, agents, employees and
representatives, and each Person who controls the Company within the meaning of
Section 15 of the Securities Act, each other such Holder and each of their
officers, directors, partners, agents, employees and representatives and each
person controlling such Holder, and each underwriter, if any, of such
Registrable Securities and each Person who controls any such underwriter,
against all expenses, claims, losses, damages and liabilities (or actions,
proceedings or settlements in respect thereof) arising out of or based on any
untrue statement or alleged untrue statement of a material fact contained in any
registration statement, any amendment thereto, offering circular or other
document incident to such registration, qualification or compliance, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
arising out of any untrue statement or alleged untrue statement of a material
fact contained in any prospectus, or any amendment thereto, or any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading in light of the
circumstances in which they were made, and will reimburse such indemnified
persons for any reasonable legal or other expenses reasonably incurred in
connection with investigating or defending any such claim, loss, damage,
liability or action, in each case to the extent, but only to the extent, that
such untrue statement or omission is made in such registration statement,
prospectus, offering circular or other document in reliance upon and in strict
conformity with written information furnished to the Company by such Holder and
provided specifically for use therein; provided, that (x) no Holder shall be
liable hereunder for any amounts, together with all previous payments under this
Section 2.7(b), in excess of the net proceeds received by such Holder pursuant
to such registration, and (y) the obligations of such Holder hereunder shall not
apply to amounts paid in settlement of any such claims, losses, damages or
liabilities (or actions in respect thereof) if such settlement is effected
without the consent of such Holder (which consent shall not be unreasonably
withheld).
(c) Each party entitled to indemnification under
this Section 2.7 (the "Indemnified Party") shall give notice to the party
required to provide indemnification (the "Indemnifying Party") promptly after
such Indemnified Party has actual knowledge of any claim as to which indemnity
may be sought and shall permit the Indemnifying Party to assume the defense of
any such claim or any
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litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or any litigation resulting
therefrom, shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld or delayed), and the Indemnified Party may participate
in such defense with counsel reasonably acceptable to and paid for by the
Indemnifying Party but otherwise at the Indemnified Party's expense, and
provided, further, that the failure of any Indemnified Party to give notice as
provided herein shall not relieve the Indemnifying Party of its obligations
under this Section 2.7 to the extent such failure is not materially prejudicial.
No Indemnifying Party in the defense of any such claim or litigation shall
except with the consent of each Indemnified Party, consent to entry of any
judgment or enter into any settlement which does not include an unconditional
release of such Indemnified Party from all liability in respect of such claim or
litigation. Each Indemnified Party shall furnish such information regarding
itself or the claim in question as an Indemnifying Party may reasonably request
in writing and as shall be reasonably required in connection with the defense of
such claim and litigation resulting therefrom.
(d) If the indemnification provided for in this
Section 2.7 is held by a court of competent jurisdiction to be unavailable to an
Indemnified Party with respect to any loss, liability, claim, damage or expense
referred to therein, then the Indemnifying Party, in lieu of indemnifying such
Indemnified Party hereunder, shall contribute to the amount paid or payable by
such Indemnified Party as a result of such loss, liability, claim, damage or
expense in such proportion as is appropriate to reflect the relative fault of
the Indemnifying Party on the one hand and of the Indemnified Party on the other
in connection with the statements or omissions which resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations. The relative fault of the Indemnifying Party and of the
Indemnified Party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
Indemnifying Party or by the Indemnified Party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. No person guilty of fraudulent misrepresentation (within
the meaning of section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) Notwithstanding the foregoing, to the extent
that the provisions on indemnification and contribution contained in an
underwriting agreement entered into in connection with an underwritten public
offering are in conflict
14
with the foregoing provisions, the provisions in the underwriting agreement
shall control.
2.8 Other Obligations. With a view to making available the
benefits of certain rules and regulations of the Commission which may effectuate
the registration of Registrable Securities or permit the sale of Registrable
Securities to the public without registration, the Company agrees to:
(a) at such time as any Registrable Securities
are eligible for transfer under Rule 144(k), upon the request of the Holder of
such Registrable Securities, remove any restrictive legend from the certificates
evidencing such Registrable Securities at no cost to such Holder;
(b) make and keep available public information
as defined in Rule 144 under the Securities Act at all times;
(c) file with the Commission in a timely manner
all reports and other documents required of the Company under the Securities Act
and the Exchange Act at any time after it has become subject to such reporting
requirements; and
(d) furnish any Holder upon request a written
statement by the Company as to its compliance with the reporting requirements of
Rule 144 (at any time from and after 90 days following the effective date of the
first registration statement filed by the Company for an offering of its
securities to the general public), and of the Securities Act and the Exchange
Act (at any time after it has become subject to such reporting requirements), a
copy of the most recent annual or quarterly report of the Company, and such
other reports and documents as a Holder may reasonably request in availing
itself of any rule or regulation of the Commission (including Rule 144A)
allowing a Holder of Registrable Securities to sell any such Registrable
Securities without registration.
ARTICLE III
Termination
This Agreement shall terminate immediately following the
moment at which there exist no securities of the Company that constitute
Registrable Securities; provided, however, that Section 2.7 hereof shall survive
indefinitely.
15
ARTICLE IV
Miscellaneous
4.1 Recapitalization, Exchanges, etc. Affecting the Common
Stock. The provisions of this Agreement shall apply to the full extent set forth
herein with respect to (a) the Registrable Securities and (b) any and all shares
of capital stock of the Company or any successor or assign of the Company
(whether by merger, consolidation, sale of assets or otherwise) which may be
issued in respect of, in exchange for, or in substitution for the Registrable
Securities, by reason of any stock dividend, split, reverse split, combination,
recapitalization, reclassification, merger, consolidation or otherwise. In the
event of any change in the capitalization of the Company as a result of any
stock split, stock dividend or stock combination, the provisions of this
Agreement shall be appropriately adjusted.
4.2 Injunctive Relief. It is hereby agreed and acknowledged
that it will be impossible to measure in money the damages that would be
suffered if the parties fail to comply with any of the obligations herein
imposed on them and that in the event of any such failure, an aggrieved Person
will be irreparably damaged and will not have an adequate remedy at law. Any
such Person shall, therefore, in addition to any other remedies available under
applicable law, be entitled to injunctive relief, including specific
performance, to enforce such obligations, without the posting of any bond, and
if any action should be brought in equity to enforce any of the provisions of
this Agreement, none of the parties hereto shall raise the defense that there is
an adequate remedy at law.
4.3 Parties in Interest. All the terms and provisions of this
Agreement shall be binding upon, shall inure to the benefit of and shall be
enforceable by the respective successors and assigns of the parties hereto. In
the event that any transferee of any Holder of Registrable Securities shall
acquire Registrable Securities, in any manner, whether by gift, bequest,
purchase, operation of law or otherwise, such transferee shall, without any
further writing of any kind, be deemed a party hereto for all purposes and such
Registrable Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Registrable Securities such transferee
shall be entitled to receive the benefits of and be conclusively deemed to have
agreed to be bound by and to perform all of the terms and provisions of this
Agreement.
16
4.4 Survival. The respective indemnities, agreements,
representations, warranties and each other provision set forth in this
Agreement or made pursuant hereto shall remain in full force and effect
regardless of any investigation (or statements as to the results thereto) made
by or on behalf of any Holder of Registrable Securities, any director, officer
or partner of such Holder, any agent or underwriter or any director, officer or
partner thereof, or any controlling person of any of the foregoing, and shall
survive the transfer of Registrable Securities by such Holder.
4.5 Amendment; Waiver.
(a) This Agreement may be amended only by a
written instrument signed by the Company and by Holders holding more than 66% of
the then outstanding Registrable Securities and, in the case of any amendment
that adversely affects any Holder or all of the members of any group of Holders
differently from any of the other Holders, by such Holder or the holders of
more than 66% in interest of the securities of the Company held by such group of
Holders.
(b) No provision of this Agreement may be waived
orally, but only by a written instrument signed by the party against whom
enforcement of such waiver is sought. Holders shall be bound from and after the
date of the receipt of a written notice from the Company setting forth such
amendment or waiver, whether or not the Registrable Securities shall have been
marked to indicate such amendment or waiver.
4.6 Notices. Except as otherwise provided in this Agreement,
notices and other communications under this Agreement shall be in writing
(including a writing delivered by facsimile transmission) and shall be deemed
to have been duly given if delivered personally, or sent by either certified or
registered mail, return receipt requested, postage prepaid, or by overnight
courier guaranteeing next day delivery, or by telex or telecopier, at the
following addresses:
if to the Company:
00 Xxxxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.,
Senior Executive Vice President
and General Counsel
Telecopier: (000) 000-0000
17
with a copy to
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
0 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx
Telecopier: (000) 000-0000
if to a Purchaser:
with a copy to:
any Purchaser may, by written notice given to the Company in accordance with
this Section 6.6, change the address to which such notice or other
communications are to be sent to it. All such notices and communications shall
be deemed to have been given on the date of delivery thereof, if delivered by
hand, on the fifth day after the mailing thereof, if mailed, on the next day
after the sending thereof, if by overnight courier and when receipt is
acknowledged, if telecopied.
4.7 Inspection. So long as this Agreement shall be in effect,
this Agreement and any amendments hereto shall be made available for inspection
by any Holder at the principal offices of the Company.
4.8 APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO THE CONFLICTS OF LAW PRINCIPLES THEREOF.
4.9 Headings. Article, section and paragraph headings are
inserted for convenience only and do not constitute a part of this Agreement.
4.10 Integration. This Agreement and the documents referred to
herein or delivered pursuant hereto which form a part hereof contain the entire
understanding of the parties with respect to the subject matter hereof. There
are no restrictions, agreements, promises, representations, warranties,
covenants or undertakings with respect to the subject matter hereof other than
those expressly set forth or referred to herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to this
subject matter.
18
4.11 Illegality. In case any provision in this Agreement shall
be declared or held invalid, illegal or unenforceable, in whole or in part,
whether generally or in any particular jurisdiction, such provision shall be
deemed amended to the extent, but only to the extent, necessary to cure such
invalidity, illegality or unenforceability, and the validity, legality and
enforceability of the remaining provisions, both generally and in every other
jurisdiction, shall not in any way be affected or impaired thereby.
4.12 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
shall constitute one and the same instrument, and it shall not be necessary in
making proof of this Agreement to produce or account for more than one such
counterpart.
19
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date set forth above.
RITE AID CORPORATION
By:
-----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Executive Vice President and
General Counsel
20
TRANSAMERICA INVESTMENT MANAGEMENT, LLC
By: ______________________________
Title:____________________________
Name: ____________________________
21
EXHIBIT A
Selling Securityholder Notice and Questionnaire
The undersigned Holder of shares of the common stock of Rite Aid
Corporation (the "Company") that are Registrable Securities (as that term is
defined in the Registration Rights Agreement, dated as of June 27, 2001 (the
"Registration Rights Agreement") by and among the Company, Transamerica
Investment Management, LLC ("Transamerica") and the Other Purchasers (as defined
in the Registration Rights Agreement), understands that the Company has filed
with the Securities and Exchange Commission (the "Commission" a registration
statement (the "Shelf Registration Statement" for the registration and resale
under Rule 415 of the Securities Act of 1933, as amended (the "Securities
Act"). All capitalized terms not otherwise defined herein shall have the meaning
ascribed thereto in the Registration Rights Agreement.
Each beneficial owner of Registrable Securities is entitled to the
benefits of the Registration Rights Agreement. In order to sell or otherwise
dispose of any Registrable Securities pursuant to the Shelf Registration
Statement, a beneficial owner of Registrable Securities generally will be
required to be named as a selling securityholder in the related prospectus,
deliver a prospectus to the purchaser of Registrable Securities and be bound by
those provisions of the Registration Rights Agreement applicable to such
beneficial owner (including certain indemnification provisions, as described
below). Beneficial owners are required to complete and deliver this Notice and
Questionnaire prior to the effectiveness of the Shelf Registration Statement so
that such beneficial owners may be named as selling securityholders in the
related prospectus at the time of effectiveness. Upon receipt of a completed
Notice and Questionnaire from a beneficial owner following the effectiveness of
the Shelf Registration Statement, the Company will, as promptly as practicable,
file such amendments to the Shelf Registration Statement or supplements to the
related prospectus as are necessary to permit such Holder to deliver such
prospectus to the purchaser of Registrable Securities. The Company has agreed to
pay liquidated damages pursuant to the Registration Rights Agreement under
certain circumstances as set forth therein.
Certain legal consequences arise from being named as a selling
securityholder in the Shelf Registration Statement and the related prospectus.
Accordingly, holders and beneficial owners of Registrable Securities are advised
to consult their own
A-1
securities law counsel regarding the consequences of being named or not being
named as a selling securityholder in the Shelf Registration Statement and the
related prospectus.
Notice
The undersigned beneficial owner (the "Selling Securityholder") of
Registrable Securities hereby gives notice to the Company of its intention to
sell or otherwise dispose of Registrable Securities beneficially owned by it and
listed below in Item 3 (unless otherwise specified under Item 3) pursuant to the
Shelf Registration Statement. The undersigned, by signing and returning this
Notice and Questionnaire, understands that it will be bound by the terms and
conditions of this Notice and Questionnaire and the Registration Rights
Agreement.
The undersigned hereby provides the following information to the
Company and represents and warrants that such information is accurate and
complete:
Questionnaire
1. (a) Full Legal Name of Selling Securityholder:
_______________________________________________________________________
(b) Full Legal Name of Registered Holder (if not the same as (a)
above) through which Registrable Securities listed in (3)
below are held:
_______________________________________________________________________
(c) Full Legal Name of DTC Participant (if applicable and if not
the same as (b) above) through which Registrable Securities
listed in (3) below are held:
2. Address for Notices to Selling Securityholder:
_______________________________________________________________________
_______________________________________________________________________
Telephone:_____________________________________________________________
Fax:___________________________________________________________________
Contact Person:________________________________________________________
A-2
3. Beneficial Ownership of Registrable Securities:
(a) Type and Principal Amount of Registrable Securities
beneficially owned:
_______________________________________________________________________
_______________________________________________________________________
(b) CUSIP No(s). of such Registrable Securities beneficially
owned:
_______________________________________________________________________
_______________________________________________________________________
4. Beneficial Ownership of the Company's securities owned by the Selling
Securityholder:
Except as set forth below in this Item (4), the undersigned is not the
beneficial or registered owner of any securities of the Company other than the
Registrable Securities listed above in Item (3).
(a) Type and Amount of Other Securities beneficially owned by the
Selling Securityholder:
(b) CUSIP No(s). of such Other Securities beneficially owned:
_______________________________________________________________________
_______________________________________________________________________
5. Relationship with the Company:
Except as set forth below, neither the undersigned nor any of its
affiliates, officers, directors or principal equity holders (5% or
more) has held any position or office or has had any other material
relationship with the Company (or their predecessors or affiliates)
during the past three years.
State any exceptions here:
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
6. Plan of Distribution:
A-3
Except as set forth below, the undersigned (including its donees or
pledgees) intends to distribute the Registrable Securities listed above
in Item (3) pursuant to the Shelf Registration Statement only as
follows if at all): such Registrable Securities may be sold from time
to time directly by the undersigned or alternatively, through
underwriters, broker-dealers or agents. If the Registrable Securities
are sold through underwriters or broker-dealers, the Selling
Securityholder will be responsible for underwriting discounts or
commissions or agent's commissions. Such Registrable Securities may be
sold in one or more transactions at fixed prices, at prevailing market
prices at the time of sale, at varying prices determined at the time of
sale, or at negotiated prices. Such sales may be effected in
transactions (which may involve block transactions) (i) on any national
securities exchange or quotation service on which the Registrable
Securities may be listed or quoted at the time of sale, (ii) in the
over-the-counter market, (iii) in transactions otherwise than on such
exchanges or services, or in the over-the-counter market, or (iv)
through the writing of options. In connection with sales of Registrable
Securities or otherwise, the undersigned may enter into hedging
transactions with broker-dealers, which may in turn engage in short
sales of the Registrable Securities and deliver Registrable Securities
to close out such short positions, or loan or pledge Registrable
Securities to broker-dealers that in turn may sell such securities.
State any exceptions here:
_______________________________________________________________________
_______________________________________________________________________
_______________________________________________________________________
The undersigned acknowledges that it understands its obligation to
comply with the provisions of the Exchange Act and the rules thereunder relating
to stock manipulation, particularly Regulation M thereunder (or any successor
rules or regulations), in connection with any offering of Registrable Securities
pursuant to the Shelf Registration Statement. The undersigned agrees that
neither it nor any person acting on its behalf will engage in any transaction in
violation of such provisions.
The Selling Securityholder hereby acknowledges its obligations under
the Registration Rights Agreement to indemnify and hold harmless certain persons
as set forth therein.
A-4
Pursuant to the Registration Rights Agreement, the Company has agreed
under certain circumstances to indemnify the Selling Securityholders against
certain liabilities.
In accordance with the undersigned's obligation under the Registration
Rights Agreement to provide such information as may be required by law for
inclusion in the Shelf Registration Statement, the undersigned agrees to
promptly notify the Company of any inaccuracies or changes in the information
provided. herein that may occur subsequent to the date hereof at anytime while
the Shelf Registration Statement remains effective. All notices hereunder and
pursuant to the Registration Rights Agreement shall be made in writing at the
address set forth below.
By signing below, the undersigned consents to the disclosure of the
information contained herein in its answers to items (1) through (6) above and
the inclusion of such information in the Shelf Registration Statement and the
related prospectus. The undersigned understands that such information will be
relied upon by the Company in connection with the preparation or amendment of
the Shelf Registration Statement and the related prospectus.
A-5
IN WITNESS WHEREOF, the undersigned, by authority duly given, has
caused this Notice and Questionnaire to be executed and delivered either in
person or by its duly authorized agent.
Dated:
Beneficial Owner
By:_________________________________
Name:
Title:
PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE TO
RITE AID CORPORATION. AT:
00 Xxxxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq, Senior Executive
Vice President and General Counsel
Facsimile: (000) 000-0000
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
0 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Facsimile: (000) 000-0000
