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Amendment No. 11 To Receivables Financing Agreement

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Sectors: Retail
Governing Law: New York, View New York State Laws
Effective Date: February 18, 2009
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Exhibit 10.3

Amendment No. 11 to Receivables Financing Agreement



This AMENDMENT NO. 11 TO RECEIVABLES FINANCING AGREEMENT, dated as of February 18, 2009 (this " Amendment Agreement "), is made by and among Rite Aid Funding II (the " Borrower "), CAFCO, LLC (" CAFCO "), CRC FUNDING, LLC (" CRC "), Falcon Asset Securitization Company LLC (" Falcon "), Variable Funding Capital Company LLC (" Variable "; together with CAFCO, CRC and Falcon, the " Investors "), Citibank, N.A. (" Citibank "), JPMorgan Chase Bank, N.A. (" JPMorgan ") and Wachovia Bank, National Association (" Wachovia "; together with Citibank and JPMorgan, the " Banks "), Citicorp North America, Inc., as program agent (the " Program Agent "), Citicorp North America, Inc. (" CNAI "), JPMorgan and Wachovia, as investor agents (CNAI, JPMorgan and Wachovia, in such capacity, the " Investor Agents "), Rite Aid Hdqtrs. Funding, Inc. (the " Collection Agent "), each of the parties named in Schedule III to the Agreement (as defined below) as originators (the " Originators ") and The Bank of New York Mellon, as Trustee.



Preliminary Statements . (1) The Borrower, the Investors (other than CRC), the Program Agent, the Banks, the Investor Agents, the Collection Agent, the Originators and The Bank of New York Mellon, as Trustee are parties to a Receivables Financing Agreement, dated as of September 21, 2004, as amended as of September 20, 2005, December 30, 2005, September 19, 2006, November 9, 2006, February 20, 2007, August 31, 2007, September 18, 2007, September 16, 2008, January 15, 2009 and January 22, 2009 (the " Agreement "; capitalized terms used herein and not otherwise defined herein shall have the meanings attributed to them in the Agreement).



(2) The Borrower, the Investors, the Program Agent, the Banks, the Investor Agents, the Collection Agent and the Originators wish to amend the Agreement.



NOW, THEREFORE, the parties agree as follows:



SECTION 1. Amendments to Agreement . As of the Effective Date (as defined below in Section 2), the Agreement is amended as follows:



1.1 Section 1.01 of the Agreement is amended as follows:



(a) The definition of "Alternate Base Rate" is amended by (i) deleting the word "and" at the end of each sub-clause (i) in each of clauses (a), (b) and (c) therein, (ii) deleting the period at the end of each sub-clause (ii) in each of clauses (a), (b) and (c) therein and in lieu thereof inserting the word "; and", and (iii) inserting a new sub-clause (iii) in each of clauses (a), (b) and (c) therein as follows:



"(iii) the Eurodollar Rate (without giving effect to clause (b) thereof) for a Fixed Period of one month beginning on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1.00% per annum."


















(b) The definition of "Bank Commitment" is amended by (i) deleting the amount "$325,000,000" in clause (a) thereof and replacing it with the amount ?$173,000,000", (ii) deleting the amount "$125,000,000" in clause (b) thereof and replacing it with the amount "$66,000,000", and (iii) deleting the amount "$200,000,000" in clause (c) thereof and replacing it with the amount "$106,000,000".



(c) The definition of "Change in Control" is amended by adding the clause "or the Jean Coutu Group (PJC) Inc. and its Affiliates" after the term "Affiliates, ? in the fourth line thereof.



(d) The definition of "Concentration Limit" is amended by deleting the phrase "higher amount" in the second line thereof and replacing it with the phrase "higher percentage".



(e) Clause (ix) of the definition of "Eligible Receivable" is amended by adding the phrase "(except those created by the Second Lien Credit Agreement)" after the words "Adverse Claim" appearing therein.



(f) The definition of "Eurodollar Rate" is amended by (i) inserting the words "the higher of (a)" after the words "an interest rate per annum equal to" in the first sentence thereof, (ii) inserting the words "and (b) 3.00% per annum" before the period at the end of the first sentence thereof, (iii) deleting the words "In the event such rate" and inserting in lieu thereof the words "In the event the rate determined in accordance with clause (a) above", and (iv) deleting the words "then the Eurodollar Rate" and inserting in lieu thereof the words "then the rate determined in accordance with clause (a) above".



(g) The definition of "Facility Amount" is amended by deleting the amount "$650,000,000" in the first line thereof and replacing it with the amount ?$345,000,000".



(h) The definition of "Intercreditor Agreement" is amended by replacing the reference to "September 21, 2004" with a reference to "September 22, 2004 ?.



(i) The definition of "Investor Facility Amount" is amended by (i) deleting the amount "$325,000,000" in clause (a) thereof and replacing it with the amount "$173,000,000", (ii) deleting the amount "$125,000,000" in clause (b) thereof and replacing it with the amount "$66,000,000", and (iii) deleting the amount "$200,000,000" in clause (c) thereof and replacing it with the amount "$106,000,000".



(j) The definition of "Net Receivables Pool Balance" is amended by deleting the text in lines 7 to 9 beginning with the words "(A) in the case of" and ending with the words "all other Obligors".



(k) The definition of "Percentage" is restated in its entirety to read as follows:



" ? Percentage ' of any Bank means, (a) with respect to Citibank, 50.1449275%, or such amount as reduced or increased by any Assignment and Acceptance entered into with an Eligible Assignee, (b) with respect to JPMorgan, 19.1304348%, or such









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amount as reduced or increased by any Assignment and Acceptance entered into with an Eligible Assignee, (c) with respect to Wachovia, 30.7246377%, or such amount as reduced or increased by any Assignment and Acceptance entered into with an Eligible Assignee, or (d) with respect to a Bank that has entered into an Assignment and Acceptance, the amount set forth therein as such Bank's Percentage, or such amount as reduced or increased by an Assignment and Acceptance entered into between such Bank and an Eligible Assignee."



(l) A new definition of "Second Lien Agent" is added which reads in its entirety as follows:



" ? Second Lien Agent ' means CNAI in its capacity as administrative agent and collateral processing agent under the Second Lien Credit Agreement, and any successor to CNAI thereunder."



(m) A new definition of "Second Lien Borrowing Base Deficiency" is added which reads in its entirety as follows:



" ? Second Lien Borrowing Base Deficiency " means, on any date, the excess, if any, of (x) the "Facility Principal" (as defined in the Second Lien Credit Agreement), over (y) the "Borrowing Base" (as defined in the Second Lien Credit Agreement)."



(n) A new definition of "Second Lien Credit Agreement" is added which reads in its entirety as follows:



" ? Second Lien Credit Agreement ' means that certain Credit Agreement dated as of February 18, 2009 among the Borrower, the Originators, certain lenders party thereto, HQ, as collection agent, and the Second Lien Agent, as the same may be amended, modified or restated from time to time."



(o) A new definition of "Second Lien Intercreditor Agreement" is added which reads in its entirety as follows:



" ? Second Lien Intercreditor Agreement ' means that certain Intercreditor Agreement dated as of February 18, 2009 by and among the Program Agent, the Borrower and the Second Lien Agent, as the same may be amended, modified or restated from time to time."



(p) The definition of "Transaction Document" is amended by adding the term "the Second Lien Intercreditor Agreement," after the term "the Intercreditor Agreement," in the second line thereof.









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1.2 Section 1.02 of the Agreement is amended by deleting the term "generally accepted accounting principals" in the second line thereof and replacing it with the term ?GAAP".



1.3 Section 2.04(a) of the Agreement is amended by deleting clause (i) thereof, renumbering clause (ii) thereof as a new clause (i) thereof, deleting the word "and" at the end of the newly renumbered clause (i) thereof, and inserting a new clause (ii) as follows:



"(ii) at any time that there exists a Second Lien Borrowing Base Deficiency, deposit to and hold in the Trustee's Account, in trust for the Beneficiaries and the Collection Agent, all Collections (which Collections shall thereafter be applied pursuant to Section 2.04(i)); and"



1.4 Section 2.04(a)(iii) of the Agreement is amended by inserting the following clause prior to the semicolon at the end thereof:



"unless otherwise instructed by the Borrower pursuant to Section 2.04(d) (and if no such instructions shall have been given by the Borrower, unless otherwise instructed in writing by the Second Lien Agent, which instructions shall state that such remaining Collections will be applied to amounts due and owing under the Second Lien Credit Agreement and otherwise in accordance with the terms of the Second Lien Credit Agreement) ?



1.5 Section 2.04(a) of the Agreement is amended by inserting the following sentence at the end of the proviso thereto:



"The Daily Report delivered by the Collection Agent to the Trustee on each Deposit Date shall set forth (x) the amount of the Second Lien Borrowing Base Deficiency and (y) the amount of funds then held in the Trustee's Account pursuant to any previous application of clause (ii) of Section 2.04(a) or clause (iii) of Section 2.04(b)."



1.6 Section 2.04(b) of the Agreement is amended by inserting the words "during the Revolving Period" after the first appearance of the words "Fixed Period" in the first sentence thereof, deleting clause (i) thereof, renumbering clause (ii) thereof as a new clause (i) thereof, renumbering clause (iii) thereof as a new clause (ii) thereof, deleting the word "and" at the end of the newly renumbered clause (ii) thereof, and inserting a new clause (iii) as follows:



"(iii) at any time that there exists a Second Lien Borrowing Base Deficiency, deposit to and hold in the Trustee's Account, in trust for the Beneficiaries and the Collection Agent, all Collections (which Collections shall thereafter be applied pursuant to Section 2.04(i)); and"



1.7 Section 2.04(b) of the Agreement is amended by inserting the following sentence at the end of the proviso thereto:









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"The Daily Report delivered by the Collection Agent to the Trustee on each Deposit Date shall set forth (x) the amount of the Second Lien Borrowing Base Deficiency and (y) the amount of funds then held in the Trustee's Account pursuant to any previous application of clause (ii) of Section 2.04(a) or clause (iii) of Section 2.04(b)."



1.8 Sections 2.04(b)(iv) and 2.04(c)(iii) of the Agreement are each hereby amended by inserting the following parenthetical expression prior to the semicolon or period (as applicable) at the end thereof:



"(unless otherwise instructed in writing by the Second Lien Agent, which instructions shall state that such remaining Collections will be applied to amounts due and owing under the Second Lien Credit Agreement and otherwise in accordance with the terms of the Second Lien Credit Agreement)".



1.9 Section 2.04(d) of the Agreement is amended by adding the following phrase prior to the period at the end thereof:



"for distribution on account of Facility Principal pursuant to Section 2.04A".



1.10 The first paragraph of Section 2.04(e) of the Agreement is amended by inserting the following proviso prior to the period at the end thereof:



"; provided , further , that if the Second Lien Agent shall have otherwise instructed the Trustee in writing as to the deposit of funds that are to be transferred to the Borrower's Account or distributed to the Borrower, the Trustee shall follow such instructions of the Second Lien Agent, which instructions shall state that such remaining
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