Form 8-K - Current report
01 Novembre 2023 - 9:30PM
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported):
November 1, 2023 (October 23, 2023)
Rite
Aid Corporation
(Exact name of registrant as specified in its
charter)
Delaware |
|
1-5742 |
|
23-1614034 |
(State
or Other Jurisdiction of Incorporation) |
|
(Commission
File Number) |
|
(IRS
Employer
Identification Number) |
P.O.
Box 3165
Harrisburg,
Pennsylvania 17105
(Address of principal executive offices, including
zip code)
(717)
761-2633
(Registrant’s telephone number, including
area code)
N/A
(Former name
or former address, if changed since last report)
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General
Instruction A.2. below):
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
|
Trading Symbol(s) |
|
Name of each exchange on which
registered |
Common
Stock, $1.00 par value |
|
RADCQ |
|
OTCMKTS* |
*Rite Aid Corporation’s common stock began trading exclusively
on the over-the-counter market on October 17, 2023 under the symbol RADCQ.
Indicate by check mark whether the registrant is
an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company ¨
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 1.01. |
Entry into a Material Definitive Agreement. |
On October 23, 2023, Rite Aid Corporation
(the “Company”) and McKesson Corporation (“McKesson”) entered into the interim supply agreement (the “Interim
Supply Agreement”), which supplements that certain Supply Agreement, effective as of December 22, 2003 and restated in its
entirety by the Seventh Amendment entered into and dated as of April 1, 2014, between the Company and McKesson for the supply by
McKesson to the Company of prescription drugs and other health and beauty care products and the provision of related services. The Interim
Supply Agreement sets forth certain trade terms governing payment for goods and services for the period after the Company filed for Chapter
11 bankruptcy (the “Chapter 11 Cases”) in the United States Bankruptcy Court of the District of New Jersey (the “Court”).
On October 26, 2023, the terms set forth in the Interim Supply Agreement were approved by the Court on an interim basis. The terms
of the Interim Supply Agreement are intended to help ensure that there is no disruption to the Company’s business and operations
during the course of the Chapter 11 Cases in relation to the goods and services provided by McKesson to the Company. There is a hearing
scheduled for November 9, 2023, whereby the Court will consider approval of the terms set forth in the Interim Supply Agreement on
a final basis.
The foregoing summary of the Interim Supply Agreement
does not purport to be complete and is qualified in its entirety by reference to the Interim Supply Agreement, a copy of which is filed
as Exhibit 10.1 hereto and is incorporated herein by reference.
Item 9.01. |
Financial Statements and Exhibits. |
(d) Exhibits.
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereto
duly authorized.
Date: November 1, 2023 |
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RITE AID CORPORATION |
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|
|
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By: |
/s/ Thomas Sabatino |
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|
Name: |
Thomas Sabatino |
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Title: |
Executive Vice President and Chief Legal Officer |
Exhibit 10.1
Confidential
Execution Version
McKesson Corporation--Rite
Aid Corporation
Interim
Post-Petition Supply Agreement
October
23, 2023
This Interim Post-Petition Supply Agreement sets
forth certain trade terms applicable to the interim supply agreement (the “Interim Supply Agreement”) agreed to by
Rite Aid Corporation (together with its affiliates, “RAC”) and McKesson Corporation (together with its affiliates,
“McKesson”) (McKesson and RAC each a “Party” and collectively the “Parties”).
All other terms of this Interim Supply Agreement other than those specifically detailed herein shall be the same as in that certain Supply Agreement
originally entered into and dated December 22, 2003 and restated in its entirety by the Seventh Amendment entered into and dated as of
April 1, 2014 (and as the same has been previously amended, the “Prepetition Supply Agreement”), including, without
limitation, section 7.7 thereof, between RAC and McKesson.
Topic |
Terms |
Effectiveness |
All terms of this Interim Supply Agreement
(other than those set forth under the section below titled “Superpriority Claims”) shall be effective as of October
15, 2023 (the “Petition Date”), the date the bankruptcy cases of RAC and certain of its affiliates (the “Debtors”)
proceeding under the caption In re Rite Aid Corporation, Case No. 23-18993 (MBK) (the “Chapter 11 Cases”)
were filed in the United States Bankruptcy Court for the District of New Jersey (the “Court”).
Not later than the first day after the execution
of this Interim Supply Agreement, the Debtors shall file a motion in the Chapter 11 Cases seeking approval of this Interim Supply Agreement
pursuant to Rule 9019 of the Federal Rules of Bankruptcy Procedure. The agreements set forth under the section titled “Superpriority
Claims” of this Interim Supply Agreement shall be effective automatically upon entry of an order of such approval by the Court
(the “9019 Order”). Upon entry of the 9019 Order, the Debtors will promptly file a notice dismissing the Complaint1
and TRO Motion2 with prejudice, except as
expressly set forth in the “Reservation of Rights” section of this Interim Supply Agreement.
|
| 1 | As used herein, “Complaint” means the Verified
Adversary Complaint filed in the adversary proceeding captioned Rite Aid Corp. v. McKesson Corp., Adv. Pro. No. 23-01294 (MBK)
in connection with the Chapter 11 Cases (the “Adversary Proceeding”) at Docket No. 1. |
| 2 | As used herein, “TRO Motion” means the Application
in Support of the Debtors’ Request for a Temporary Restraining Order and Preliminary Injunction filed in the Adversary Proceeding
at Docket No. 2. |
Confidential
Topic |
Terms |
Payment Terms |
Invoices for deliveries
of products to RAC (including to any retail or specialty pharmacy owned and operated by RAC or its affiliates) (collectively, “Pharmacies”)
shall be due and paid on or before the seventh (7th) day after the date of delivery of such invoice (the “Invoice Date”),
except that, in the case of orders to warehouses, the Invoice Date is the date that the order departs the RDC, unless an alternate delivery
time has been requested by RAC, in which event, such Invoice Date shall be the date the product is ready for shipment from the RDC;3
provided, however, that if a payment is due on a Saturday, then the payment shall instead be due on the preceding
Business Day.4 If a payment is due on a
day specified as a Sunday or a Holiday, then payment shall instead be due on the following Business Day. Each date such a payment is
required to be made in relation to an invoice is referred to herein as a “Payment Due Date”. |
Applicable Cure Period |
RAC shall timely pay all invoices
when due for goods delivered on and after the Petition Date, but in the case that RAC (i)
fails to pay at least 95% of the full amount owed to McKesson by the applicable Payment Due
Date, or (ii) has three (3) or more unresolved, unpaid Payment Shortfalls (as defined
below) outstanding concurrently (each, an “Unsatisfactory Payment Performance”),
then RAC may elect to cure such Unsatisfactory Payment Performance within the following periods
(each a, “Cure Period”):
|
|
|
Type of
Unsatisfactory
Payment
Performance |
Applicable Cure Period |
|
|
|
An invoice is partially paid (95% or less)
or
Three (3) or more concurrent unresolved, unpaid Payment Shortfalls |
The second (2nd) Business Day after McKesson delivers written notice, including by email, of such Unsatisfactory Payment Performance (an “Unsatisfactory Payment Notice”, which shall set forth in reasonable detail the grounds or basis for such determination) to RAC.5 |
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|
|
No part of an invoice is paid |
The first (1st) Business Day after McKesson delivers an Unsatisfactory Payment Notice to RAC |
|
|
Any
payment of less than 100% but greater than 95% of the full amount owed to McKesson by the
applicable Payment Due Date (each, a “Payment Shortfall”) will be solely
due to error (which RAC will resolve immediately upon discovery) or a dispute over an invoice
(which RAC and McKesson will work in good faith to resolve promptly and in accordance with
historical practices); provided that for these purposes notices via email from McKesson
of a Payment Shortfall will suffice. RAC shall pay any Payment Shortfall no later than
one (1) Business Day after resolution of any such error or dispute, including in the event
of any partial resolution of a dispute; provided, however, that the Cure Period
set forth above will apply in the event that three (3) or more Payment Shortfalls are outstanding
concurrently.
McKesson acknowledges
that RAC shall contemporaneously send to the ABL Agents6 and the advisors to the
Ad Hoc Secured Noteholder Group7 any notices that McKesson sends to RAC pursuant
to this “Applicable Cure Period” section. |
| 3 | As used herein, “RDC” means a McKesson redistribution
center. |
“Business
Day” means any day that is not a Saturday, Sunday, or Holiday.
“Holiday”
means a day on which banks are legally authorized to close in the State of New York
| 5 | Email notice shall also include counsel to RAC: aparna.yenamandra@kirkland.com
and joshua.sussberg@kirkland.com |
| 6 | As used herein, “ABL Agents” shall have the
meaning given to such term in the Declaration of Jeffrey S. Stein in Support of Debtors’ Chapter 11 Petitions and First Day
Motions filed in the Chapter 11 Cases at Docket No. 20 (the “Stein Declaration”). |
| 7 | As used herein “Ad Hoc Secured Noteholder Group”
shall have the meaning given to such term in the Stein Declaration. |
Confidential
Topic |
Terms |
Change in Payment Terms |
In addition to any other rights and remedies under the Interim Supply Agreement, upon the expiration of any Cure Period following any Unsatisfactory Payment Performance, without cure from RAC, and without any further notice or consent of RAC or any other person, McKesson may elect to (i) suspend or discontinue the shipment of any additional orders to RAC or any of its Pharmacies and/or (ii) change any of the payment terms of this Interim Supply Agreement including, without limitation, by imposing the requirement for all future invoices of cash payment upon delivery, subject to payment in full of all outstanding invoices for goods delivered on and after the Petition Date. |
Superpriority Claims |
All amounts owed by
RAC to McKesson on account of goods shipped on and after the Petition Date shall be granted a superpriority administrative expense claim
against each of the Debtors’ estates pursuant to Section 364(c)(1) of the Bankruptcy Code8
(the “Superpriority Claims”), which for the purposes of section 1129(a)(9)(A) of the Bankruptcy
Code shall be considered an administrative expense allowed in full under section 503(b) of the Bankruptcy Code. McKesson’s
Superpriority Claims shall be senior to all administrative claims in the Bankruptcy Cases and shall be immediately junior to (i) the
DIP Superpriority Claims, (ii) any Adequate Protection Superpriority Claims, and (iii) for the avoidance of doubt, the Carve Out.9 |
| 8 | As used herein, “Bankruptcy Code” means title
11 of the United States Code, as amended. |
| 9 | As used herein, the terms “DIP Superpriority Claims”,
“Adequate Protection Superpriority Claims”, and “Carve Out” shall have the meanings given to such
terms in the Interim Order (I) Authorizing the Debtors to Obtain Postpetition Financing, (II) Authorizing the Debtors to Use Cash
Collateral, (III) Granting Liens and Providing Superpriority Administrative Expense Claims, (IV) Granting Adequate Protection, (V) Modifying
the Automatic Stay, (VI) Scheduling a Final Hearing, and (VII) Granting Related Relief, entered in the Chapter 11 Cases at Docket
No. 120 (the “Interim DIP Order”). |
Confidential
Topic |
Terms |
Additional Interim Supply Agreement Reporting Rights |
On and after the date of this Interim Supply Agreement, McKesson shall receive copies of all certificates, notices or other reporting (financial or otherwise) as and when provided to the DIP Lenders, the ABL Lenders, the Ad Hoc Secured Noteholder Group, to any Prepetition Secured Parties, to the holders of the holders of the Unsecured Notes or any other post-petition secured parties from time to time, whether provided pursuant to the Prepetition Debt Documents, DIP Documents, the Restructuring Support Agreement10 or in other agreements with holders of material indebtedness, as may be agreed from time to time, (including, without limitation, any compliance certificates, borrowing base certificates, periodic reports and notices of any default or event of default). |
Case Direction Meetings |
The Debtors will use best efforts to arrange regular case-direction meetings among the Debtors, McKesson, the Ad Hoc Secured Noteholder Group, the DIP ABL and Term Loan Agent and the ABL Agent, and any other creditor groups that form after the date of this Interim Supply Agreement and entry of the 9019 Order (or, in each case, professionals thereto). |
| 10 | As used herein, “ABL Lenders”, “Ad
Hoc Secured Noteholder Group”, “Prepetition Secured Parties”, “Unsecured Notes”, “Prepetition
Debt Documents”, “DIP Documents”, and “Restructuring Support Agreement” shall have the
meanings given to such terms in the Stein Declaration. |
Confidential
Topic |
Terms |
Reservation of Rights |
RAC and McKesson expressly reserve all rights with respect to the purported termination of the Prepetition Supply Agreement on or before the Petition Date, and any future motion to reject or assume the Prepetition Supply Agreement under Section 365 of the Bankruptcy Code. In addition, for the avoidance of doubt, RAC and McKesson expressly reserve all rights and remedies with respect to the enforcement of this Interim Supply Agreement. |
Acknowledgement of Prepetition Claim |
By RAC’s signature hereto, the Debtors
hereby acknowledge McKesson’s prepetition claim for goods delivered prior to the Petition Date and that such claim constitutes an
administrative claim under Section 503(b)(9) of the Bankruptcy Code.
McKesson and the Debtors agree that the pricing
set forth in the invoices is determinative of the value of the products received by RAC. The 503(b)(9) claim amount may be adjusted from
time to time to incorporate updated delivery information.
|
Term of Interim Supply Agreement |
Unless earlier terminated pursuant to the terms set forth herein or as otherwise agreed by the Parties, the terms of this Interim Supply Agreement set forth herein shall remain in force until the earliest of (i) the closing date of a sale of substantially all of the Debtors’ pharmacy operations, (ii) the liquidation of substantially all of the Debtors’ pharmacy assets, and (iii) the effective date of a chapter 11 plan in the Chapter 11 Cases. |
Good Faith Cooperation |
During the term of this Interim Supply Agreement,
RAC and McKesson shall use best efforts to negotiate a mutually beneficial go-forward post-bankruptcy supply agreement with McKesson.
With respect to all product orders, returns,
and rebates, RAC and McKesson will cooperate in good faith to identify the Invoice Date and delivery date of the products in order to
properly classify and allocate obligations relating to the period prior to the Petition Date versus obligations arising under the Interim
Supply Agreement.
|
[Signature Page Follows]
Confidential
Each of the signatories to this Interim Supply Agreement represents
that s/he is authorized to execute on behalf of each respective Party.
|
RITE AID CORPORATION |
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|
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By: |
/s/ Matthew Schroeder |
|
Name: |
Matthew Schroeder |
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Title: |
Executive Vice President and Chief Financial Officer |
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MCKESSON CORPORATION |
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|
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By: |
/s/ Britt Vitalone |
|
Name: |
Britt Vitalone |
|
Title: |
Executive Vice President and Chief Financial Officer |
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Grafico Azioni Rite Aid (NYSE:RAD)
Storico
Da Nov 2024 a Dic 2024
Grafico Azioni Rite Aid (NYSE:RAD)
Storico
Da Dic 2023 a Dic 2024