exv10w1



 



Exhibit 10.1


EXECUTION VERSION



		
	 	        WAIVER dated as of March 18, 2003 (this “Waiver”) to the
Credit Agreement dated as of September 22, 2000 (the “Credit
Agreement”) as heretofore amended, among Select Medical
Corporation, a Delaware corporation (the “Company”), Canadian Back
Institute Limited, an Ontario corporation and a wholly owned
subsidiary of the Company (“CBIL” and, together with the Company,
the “Borrowers”), the Lenders party thereto, JPMorgan Chase Bank
(f/k/a The Chase Manhattan Bank), as US Agent and US Collateral
Agent, J.P. Morgan Bank Canada (f/k/a The Chase Manhattan Bank of
Canada), as Canadian Agent and Canadian Collateral Agent, Banc of
America Securities, LLC, as Syndication Agent, and CIBC, Inc., as
Documentation Agent.



               WHEREAS, the Borrowers have requested that the Lenders (such term and each
other capitalized term used but not otherwise defined herein having the meaning
assigned to it in the Credit Agreement) approve waivers of certain provisions
of the Credit Agreement;



               WHEREAS, the undersigned Lenders are willing, on the terms and subject to
the conditions set forth herein, to approve such waivers of the Credit
Agreement;



               NOW, THEREFORE, in consideration of these
premises, the Borrowers and the undersigned Lenders hereby agree as follows:



               SECTION 1. Waivers of Credit Agreement.
Effective as of the Waiver Effective Date (as defined in Section 4
hereof):



               (a)   Section 6.15 is waived to the extent, and only
to the extent, necessary to allow the Company to apply up to
$25,000,000 of its surplus cash to buyback a like amount of
Qualified Subordinated Indebtedness; provided that such
buyback may not occur until after the Company has prepaid
$25,000,000 of US Term Borrowings as contemplated in
paragraph (b) of this Section.



               (b)   Paragraph (e) of Section 2.11 is waived to the
extent, and only to the extent, necessary to allow the
Company to prepay an aggregate amount of up to $25,000,000
(including $13,705,000 representing Excess Cash Flow for the
fiscal year ended December 31, 2002, that is required to be
prepaid under paragraph (d) of Section 2.11) of US Term
Borrowings without ratably prepaying Canadian Term



 






 



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               prepaying Canadian Term Borrowings and B/As; provided that such prepayment
must occur on or before March 31, 2003.



               SECTION 2.   Representations and Warranties. Each of the Borrowers
represents and warrants to each of the Lenders that, after giving effect to the
waivers contemplated hereby, (a) the representations and warranties of such
Borrower set forth in the Credit Agreement are true and correct in all material
respects on and as of the date of this Waiver, except to the extent such
representations and warranties expressly relate to an earlier date (in which
case such representations and warranties shall be true and correct in all
material respects as of the earlier date) and (b) no Default has occurred and
is continuing.



               SECTION 3.   Effectiveness. This Waiver shall become effective as of the
date (the “Waiver Effective Date”) when the Administrative Agent (or its
counsel) shall have received copies hereof that, when taken together, bear the
signatures of the Borrowers, the Required Lenders, and a majority in interest
of the Canadian Term Lenders.



               SECTION 4.   Applicable Law. THIS WAIVER SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.



               SECTION 5.   No Other Waivers or Amendments. Except as expressly set forth
herein, this Waiver shall not by implication or otherwise limit, impair,
constitute a waiver of, or otherwise affect the rights and remedies of any
party under, the Credit Agreement, nor alter, modify, amend or in any way
affect any of the terms, conditions, obligations, covenants or agreements
contained in the Credit Agreement, all of which are ratified and affirmed in
all respects and shall continue in full force and effect. This Waiver shall
apply and be effective only with respect to the provisions of the Credit
Agreement specifically referred to herein. This Waiver shall constitute a
“Loan Document” for all purposes of the Credit Agreement and the other Loan
Documents.



               SECTION 6.   Counterparts. This Waiver may be executed in two or more
counterparts, each of which shall constitute an original, but all of which when
taken together shall constitute but one contract. Delivery of an executed
counterpart of a signature page of this Waiver by facsimile transmission shall
be as effective as









 




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delivery of a manually executed counterpart of this Waiver.



               SECTION 7.   Headings. Section headings used herein are for convenience of
reference only, are not part of this Waiver and are not to affect the
construction of, or to be taken into consideration in interpreting, this
Waiver.








 



4


               IN WITNESS WHEREOF, the Borrowers and the undersigned Lenders have
caused this Waiver to be duly executed by their duly authorized officers,
all as of the date first above written.




	 	 	 	 	 
	 	SELECT MEDICAL CORPORATION,
	 	 	 	 	 
	 	 	
by:
	 	/s/ Martin F. Jackson


Name: Martin F. Jackson

Title: Senior Vice President & CFO
	 	 	 	 	 
	 	CANADIAN BACK INSTITUTE LIMITED
	 	 	 	 	 
	 	 	
by:
	 	/s/ Martin F. Jackson


Name: Martin F. Jackson 

Title: Vice President
	 	 	 	 	 
	 	JP MORGAN CHASE BANK, 

individually and as US Agent 

and US Collateral Agent,
	 	 	 	 	 
	 	 	
by:
	 	/s/ James S. Ely III
	 	 	 	 	

	 	 	 	 	Name: James S. Ely III

Title: Managing Director
	 
	 	J.P. MORGAN BANK CANADA, 

individually and as Canadian 

Agent and Canadian Collateral 

Agent,
	 	 	 	 	 
	 	 	
by:
	 	/s/ Christine Chan
	 	 	 	 	

	 	 	 	 	Name: Christine Chan 

Title: Vice President





 







 



	 	 	 	 	 
	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	Name of Institution:
	 	 	 	 	 
	 	 	 	                 CIBC
Inc.
	 	 	

	 	 	 	 	 
	 	 	
by:
	 	/s/ Terence Moore
	 	 	 	 	

	 	 	 	 	Name: Terence Moore

Title: Executive Director

          CIBC World Markets Corp., As Agent




 






 




	 	 	 	 	 
	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	Credit Suisse First Boston
	 	 	 	 	 
	 	 	
by
	 	/s/ Christopher Lally
	 	 	 	 	

	 	 	 	 	Name: Christopher Lally
	 	 	 	 	Title: Vice President
	 	 	 	 	 
	 	 	
by
	 	/s/ Jennifer A. Rieza
	 	 	 	 	

	 	 	 	 	Name : Jennifer A. Rieza
	 	 	 	 	Title: Associate




 






 




	 	 	 	 	 
	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	Name of Institution:
	 	 	 	 	 
	 	 	Fleet
National Bank

	 	 	 	 	 
	 	 	
by
	 	/s/ Maryann S. Smith
	 	 	 	 	

	 	 	 	 	Name: Maryann S. Smith
	 	 	 	 	Title: Director




 






 




	 	 	 	 	 
	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	Name of Institution:
	 	 	 	 	 
	 	 	GENERAL ELECTRIC CAPITAL CORPORATION
	 	 	 	 	 
	 	 	
by
	 	/s/ Brian Schwinn
	 	 	 	 	

	 	 	 	 	Name: Brian Schwinn
	 	 	 	 	Title: Duly Authorized Signatory




 






 



	 	 	 	 	 
	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	Name of Institution:
	 	 	 	 	 
	 	 	
        PNC Bank, NA


	 
	 	 	
by
	 	/s/ Jeffrey Delay
	 	 	 	 	

	 	 	 	 	Name: Jeffrey Delay

Title: Assistant Vice President




 






 




	 	 	 	 	 
	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	Name of Institution:
	 	 	 	 	 
	 	 	 
              Societe
Generale


	 	 	 	 	 
	 	 	
by
	 	/s/ Richard Bernap
	 	 	 	 	

	 	 	 	 	Name: Richard Bernap
	 	 	 	 	Title: Director




 






 




	 	 	 	 	 
	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	AERIES
FINANCE-II LTD.
	 	 	
By:
	 	INVESCO Senior Secured Management, Inc.

As Sub-Managing Agent
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory





 






 




	 	 	 	 	 
	 	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	AMARA 2 FINANCE, LTD.
	 	 	
By:
	 	INVESCO Senior Secured Management, Inc.

As Financial Manager
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory




 






 



	 	 	 	 	 
	 	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	AVALON CAPITAL LTD. 2
	 	 	
By:
	 	INVESCO Senior Secured Management, Inc.

As Portfolio Advisor
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory




 






 



	 	 	 	 	 
	 	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	CERES II FINANCE LTD.
	 	 	
By:
	 	INVESCO Senior Secured Management, Inc.

As Sub-Managing Agent (Financial)
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory




 






 




	 	 	 	 	 
	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	OASIS COLLATERALIZED HIGH INCOME PORTFOLIOS-1, LTD.
	 	 	
By:
	 	INVESCO Senior Secured Management, Inc. As Subadvisor
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory





 






 



	 	 	 	 	 
	 	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	CHARTER VIEW PORTFOLIO
	 	 	
By:
	 	INVESCO Senior
Secured Management, Inc.

As Investment Advisor
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory




 






 



	 	 	 	 	 
	 	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	DIVERSIFIED CREDIT PORTFOLIO LTD.
	 	 	
By:
	 	INVESCO Senior
Secured Management, Inc.

As Investment Advisor
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory




 






 



	 	 	 	 	 
	 	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	AIM FLOATING RATE FUND
	 	 	
By:
	 	INVESCO Senior
Secured Management, Inc.

As Attorney in fact
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory




 






 




	 	 	 	 	 
	 	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	INVESCO
EUROPEAN CDO I S.A.
	 	 	
By:
	 	INVESCO Senior
Secured Management, Inc.

As Collateral Manager
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory




 






 




	 	 	 	 	 
	 	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	INVESCO CBO 2000-1 LTD.
	 	 	
By:
	 	INVESCO Senior
Secured Management, Inc.

As Portfolio Advisor
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory




 






 




	 	 	 	 	 
	 	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	SEQUILS-LIBERTY, LTD.
	 	 	
By:
	 	INVESCO Senior
Secured Management, Inc.

As Collateral Manager
	 	 	 	 	 
	 	 	
by
	 	/s/ Scott Baskind
	 	 	 	 	

	 	 	 	 	Name: Scott Baskind
	 	 	 	 	Title : Authorized Signatory




 






 



	 	 	 	 	 
	 	 	To approve the Waiver dated as of March 18,
2003 (the “Waiver”) to the Select Medical
Corporation Credit Agreement dated as of
September 22, 2000:
	 	 	 	 	 
	 	 	Name of Institution:
	 	 	 	 	 
	 	 	     Wachovia Bank, National Association

	 	 	 	 	 
	 	 	
by
	 	/s/ Jeanette A. Griffin
	 	 	 	 	

	 	 	 	 	Name: Jeanette A. Griffin
	 	 	 	 	Title: Director