Document:

Exhibit 10.1

 

STOCK PURCHASE AGREEMENT

 

This STOCK PURCHASE AGREEMENT (this “Agreement”) is entered into as of February 26, 2014, by and between WELSH, CARSON, ANDERSON & STOWE IX, L.P., a Delaware limited partnership (“WCAS IX”), WCAS CAPITAL PARTNERS IV, L.P., a Delaware limited partnership (“WCAS CP IV,” and, together with WCAS IX, the “Sellers” and each, individually, a “Seller”), and Select Medical Holdings Corporation, a Delaware corporation (“Select”).

 

WHEREAS, Select agrees to purchase from each Seller, and each Seller agrees to sell to Select, the number of shares of Common Stock, par value $0.001 per share (the “Common Stock”), of Select as set forth on Schedule I attached hereto (collectively, the “Purchased Shares”), such sale and purchase to be consummated in accordance with the terms and subject to the conditions set forth herein;

 

NOW, THEREFORE, in consideration of the premises set forth above and of the mutual representations, covenants, and obligations hereinafter set forth, and for other good and valuable consideration, the receipt, sufficiency, and adequacy of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

 

ARTICLE I

PURCHASE AND SALE OF PURCHASED SHARES

 

1.1                               Purchase and Sale of Purchased Shares. The closing of the purchase and sale of the Purchased Shares contemplated herein (the “Closing”) shall take place on the later of (i) two (2) business days after the date on which the Sellers have been advised by Select’s stock transfer agent that the share certificates representing the Purchased Shares have been received by Select’s transfer agent and (ii) the effectiveness of the Credit Agreement Amendment (as hereinafter defined) (the “Closing Date”), unless another date is agreed to by Select and the Sellers. The Closing shall take place in New York, New York at the offices of Ropes & Gray LLP or at such other place (including by facsimile or PDF) as Select and the Sellers shall agree in writing at such time as the parties shall mutually agree. At the Closing, in accordance with the terms and subject to the conditions hereinafter set forth, the Sellers shall sell, transfer and deliver to Select, and Select shall purchase from the Sellers, all of the Sellers’ rights, title and interest in and to the Purchased Shares.

 

1.2                               Purchase Price. The purchase price for the Purchased Shares shall be ten dollars and ninety-five cents ($10.95) per share, for an aggregate purchase price of one hundred and nine million and five hundred thousand dollars ($109,500,000.00) (the “Purchase Price”).

 

1.3                               Closing Payment and Delivery of Purchased Shares. On the Closing Date, (a) Select shall remit, or cause to be remitted, to each Seller the Purchase Price set forth opposite such Seller’s name and beneath Select’s name on Schedule I hereto in immediately available funds in accordance with wire instructions provided by the Sellers to Select in writing and (b) concurrently therewith, each Seller shall deliver, or cause to be delivered, to Select’s transfer agent certificates representing the Purchased Shares opposite such Seller’s name and beneath Select’s

 

 

name on Schedule I hereto, duly endorsed (or accompanied by duly executed stock powers) for transfer of such Purchased Shares to Select.

 

ARTICLE II

REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE SELLERS

 

Each Seller, as to itself, hereby represents and warrants to, and agrees with, Select, as of the date hereof and as of the Closing Date, as follows:

 

2.1                               Such Seller is a limited partnership, duly formed, validly existing and in good standing under the laws of its jurisdiction of formation and has the power to carry on its business as it is now being conducted and to enter into this Agreement and consummate the transactions contemplated by this Agreement.

 

2.2                               The execution, delivery and performance by such Seller of this Agreement and the consummation of the transactions contemplated hereby are within the power and authority of such Seller and have been duly authorized by all necessary action on the part of such Seller. The execution, delivery and performance by such Seller of this Agreement and the consummation of the transactions contemplated hereby require no approval of, filing with, or other action by such Seller, by or in respect of, any governmental body, agency or official or any other person, other than any filings by such Seller or its affiliates required to be made after the Closing Date under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

 

2.3                               This Agreement has been (a) duly executed and delivered by such Seller and (b) assuming the due authorization, execution and delivery of this Agreement by Select, constitutes a legal, valid and binding obligation of such Seller, enforceable against such Seller in accordance with its terms, except as the enforceability hereof may be limited by (i) applicable bankruptcy, insolvency, moratorium, reorganization or similar laws in effect which affect the enforcement of creditors’ rights generally or (ii) general principles of equity, whether considered in a proceeding at law or in equity.

 

2.4                               Neither the execution and the delivery of this Agreement nor the consummation of the transactions contemplated hereby will (a) violate in a material respect any statute, regulation, rule, judgment, order or other restriction of any government, governmental agency or court to which such Seller is subject; (b) result in a material breach of, or constitute a default under, any agreement, contract, lease, license or instrument to which such Seller is a party or by which such Seller is bound; or (c) conflict with or result in any breach of any provision of the limited partnership agreement of such Seller.

 

2.5                               Such Seller (a) is the sole record and beneficial owner of each of the Purchased Shares set forth opposite its name on Schedule I attached hereto, (b) has good and marketable title to each of such Purchased Shares and (c) has the full legal right, power and authority to sell, transfer and deliver such Purchased Shares in accordance with the terms of this Agreement. The delivery by such Seller to Select of such Purchased Shares pursuant to the terms of this Agreement will transfer to Select good, valid and legal title to such Purchased Shares, free and clear of any and all liens, claims, pledges, charges, security interests or encumbrances. None of such Purchased Shares are subject to any shareholders agreement, voting agreement, voting trust,

 

 

proxy or any other contractual obligation relating to the transferability or the voting of such Purchased Shares.

 

2.6                               No investment bank, financial advisor, broker or finder has acted for such Seller in connection with this Agreement or the transactions contemplated hereby, and no investment bank, financial advisor, broker or finder is entitled to any brokerage or finder’s fee or other commissions in respect of such transactions based upon agreements, arrangements or understandings made by or on behalf of such Seller.

 

2.7                               Such Seller has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of its sale of the Purchased Shares and the other transactions contemplated hereby, and is entering into such transactions with a full understanding of all of the terms, conditions and risks thereof and knowingly and willingly assumes such terms, conditions and risks. Such Seller acknowledges and agrees that it has made its own inquiry and investigation into, and, based thereon, has formed an independent judgment concerning, Select and its business and operations, and has had, and has, full access to such information about Select and its business and operations as such Seller requires. SUCH SELLER UNDERSTANDS THAT SELECT MAY POSSESS MATERIAL, NON-PUBLIC INFORMATION RELATING TO SELECT AND THE COMMON STOCK. SUCH SELLER REPRESENTS, WARRANTS AND AGREES THAT IT HAS NOT REQUESTED FROM SELECT (OR ANY OF SELECT’S AFFILIATES OR ANY OF THEIR RESPECTIVE REPRESENTATIVES) AND HAS NOT RECEIVED FROM SELECT (OR ANY OF SELECT’S AFFILIATES OR ANY OF THEIR RESPECTIVE REPRESENTATIVES) ANY INFORMATION ABOUT SELECT AND ITS BUSINESS AND OPERATIONS AND UNDERSTANDS AND APPRECIATES THE SIGNIFICANCE OF THERE BEING UNDISCLOSED INFORMATION, POSSIBLY INCLUDING MATERIAL INFORMATION, WITH RESPECT THERETO AND WITH RESPECT TO THE COMMON STOCK. SUCH SELLER REPRESENTS, WARRANTS AND AGREES THAT, EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES OF EACH SELLER AS EXPRESSLY SET FORTH IN ARTICLE III HEREOF, NONE OF SELECT, SELECT’S AFFILIATES OR ANY OF THEIR RESPECTIVE REPRESENTATIVES MAKES OR HAS MADE, OR SHALL BE DEEMED TO HAVE MADE, TO SUCH SELLER OR ANY OF ITS AFFILIATES OR ANY OF THEIR RESPECTIVE REPRESENTATIVES ANY REPRESENTATION OR WARRANTY OF ANY KIND OR NATURE WHATSOEVER (ORAL OR WRITTEN, EXPRESS OR IMPLIED), AND NO PERSON HAS BEEN AUTHORIZED BY SELECT TO MAKE ANY REPRESENTATION OR WARRANTY RELATING TO SELECT OR ITS BUSINESS OR OPERATIONS OR OTHERWISE IN CONNECTION WITH THE PURCHASE AND SALE OF THE PURCHASED SHARES AND THE OTHER TRANSACTIONS CONTEMPLATED HEREBY, AND REPRESENTS, WARRANTS AND AGREES THAT IN DETERMINING TO ENTER INTO AND PERFORM THIS AGREEMENT, SUCH SELLER HAS NOT RELIED UPON ANY REPRESENTATION, WARRANTY, COVENANT OR AGREEMENT (ORAL OR WRITTEN, EXPRESS OR IMPLIED), RELATING TO SELECT OR ITS BUSINESS OR OPERATIONS OR OTHERWISE IN CONNECTION WITH THE PURCHASE AND SALE OF THE PURCHASED SHARES AND THE OTHER TRANSACTIONS CONTEMPLATED HEREBY, OTHER THAN THE RESPECTIVE

 

 

REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS OF SELECT EXPRESSLY SET FORTH HEREIN.

 

ARTICLE III

REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF SELECT

 

Select, hereby represents and warrants to, and agrees with, the Sellers, as of date hereof and as of the Closing Date, as follows:

 

3.1                               Select is a corporation, duly formed and validly existing under the laws of Delaware, and has the power to carry on its business as it is now being conducted and to enter into this Agreement and consummate the transactions contemplated by this Agreement.

 

3.2                               The execution, delivery and performance by Select of this Agreement and the consummation of the transactions contemplated hereby are within the power and authority of Select and have been duly authorized by all necessary action on the part of Select, acting by the Board of Directors of Select or by a committee of the Board of Directors of Select established for the purpose of reviewing the transactions contemplated by this Agreement, in each case excluding any members that are affiliated with any of the Sellers. The execution, delivery and performance by Select of this Agreement and the consummation of the transactions contemplated hereby require no approval of, filing with, or other action by Select, by or in respect of, any governmental body, agency or official or any other person, other than any filings by Select or its affiliates required to be made under the Exchange Act.

 

3.3                               This Agreement has been (a) duly executed and delivered by Select and (b) assuming the due authorization, execution and delivery of this Agreement by the Sellers, constitutes a legal, valid, and binding obligation of Select, enforceable against Select in accordance with its terms, except as the enforceability hereof may be limited by (i) applicable bankruptcy, insolvency, moratorium, reorganization or similar laws in effect which affect the enforcement of creditors’ rights generally or (ii) general principles of equity, whether considered in a proceeding at law or in equity.

 

3.4                               Neither the execution and the delivery of this Agreement, nor the consummation of the transactions contemplated hereby, will (a) violate in a material respect any statute, regulation, rule, judgment, order or other restriction of any government, governmental agency or court to which Select is subject; (b) result in a material breach of, or constitute a default under, any agreement, contract, lease, license or instrument to which Select is a party or by which Select is bound; or (c) conflict with or result in any breach of any provision of the articles of incorporation or bylaws of Select.

 

3.5                               No investment bank, financial advisor, broker or finder has acted for Select in connection with this Agreement or the transactions contemplated hereby, and no investment bank, financial advisor, broker or finder is entitled to any brokerage or finder’s fee or other commissions in respect of such transactions based upon agreements, arrangements or understandings made by or on behalf of Select.

 

3.6                               Select acknowledges that the Purchased Shares have not been and will not be registered under the Securities Act of 1933, as amended (the

 

 

“Securities Act”), or applicable state laws, and that the Purchased Shares are being offered and sold pursuant to an exemption from registration that is based in part upon Select’s representations, warranties, agreements and covenants contained in this Agreement.

 

3.7                               Select is acquiring the Purchased Shares for its own account for investment only and shall not resell, transfer or otherwise dispose of, directly or indirectly, the Purchased Shares in violation of the Securities Act and applicable state laws and in no event prior to the six month anniversary of the Closing Date. Notwithstanding the foregoing, Select shall not be restricted from canceling and retiring the Purchased Shares.

 

3.8                               Select acknowledges that the Purchased Shares will bear a restrictive legend to the effect that the Purchased Shares are subject to the restrictions in this Agreement and have not been registered under the Securities Act.  Select acknowledges that until the Closing, the Sellers shall be the holders of record of the shares of Common Stock representing the Purchased Shares and shall continue to hold all rights, and receive all benefits, of holders of shares of Common Stock of Select, including without limitation voting rights, and the right to receive dividends and distributions payable to holders of record as of, or prior to, the Closing Date.

 

3.9                               Select has funds readily and unconditionally available sufficient to fund the purchase of the Purchased Shares contemplated hereunder.

 

3.10                        Select will use its reasonable efforts to make such amendments to the Credit Agreement, dated June 1, 2011 and as amended from time to time, among Select, Select Medical Corporation and the lenders party thereto, in form and substance reasonably acceptable to Select to facilitate the consummation of the transactions contemplated hereby (the “Credit Agreement Amendment”).

 

ARTICLE IV

CONDITIONS TO THE PARTIES’ OBLIGATIONS

 

4.1                               Conditions to the Obligations of Select. Select’s obligations to effect the transactions set forth in Article I shall be subject to the fulfillment (or waiver by Select) at the Closing of the following conditions:

 

4.1.1 Representations and Warranties. The representations and warranties made by each Seller in Article II hereof shall be true and correct in all material respects as of, and as if made on, the Closing Date.

 

4.1.2 Performance. The Sellers shall have performed and complied in all material respects with each agreement, covenant and obligation required by this Agreement to be so performed or complied with by the Sellers at or before the Closing.

 

4.1.3 No Injunctions or Regulatory Restraints; Illegality. No temporary restraining order, preliminary or permanent injunction or other order issued by any court or regulatory authority of competent jurisdiction prohibiting the consummation of the transactions contemplated by this Agreement shall be in effect; nor shall there be any action taken, or any law, regulation or order enacted, that would prohibit the consummation of the transactions contemplated by this Agreement.

 

 

4.2                               Conditions to the Obligations of the Sellers. Each Seller’s obligations to effect the transactions set forth in Article I shall be subject to the fulfillment (or waiver by such Seller) at the Closing of the following conditions:

 

4.2.1 Representations and Warranties. The representations and warranties made by Select in Article III hereof shall be true and correct in all material respects as of, and as if made on, the Closing Date.

 

4.2.2 Performance. Select shall have performed and complied with in all material respects each agreement, covenant and obligation required by this Agreement to be so performed or complied with by Select at or before the Closing.

 

4.2.3 No Injunctions or Regulatory Restraints; Illegality. No temporary restraining order, preliminary or permanent injunction or other order issued by any court or regulatory authority of competent jurisdiction prohibiting the consummation of the transactions contemplated by this Agreement shall be in effect; nor shall there be any action taken, or any law, regulation or order enacted, that would prohibit the consummation of the transactions contemplated by this Agreement.

 

ARTICLE V
  TERMINATION

 

5.1                               Termination. This Agreement may be terminated and the transactions contemplated hereby abandoned at any time prior to the Closing:

 

5.1.1 By Select or the Sellers if: (a) there shall be in effect a final nonappealable order of any court or regulatory authority of competent jurisdiction preventing consummation of the transactions contemplated hereby, or (b) there shall be any statute, rule, regulation or order enacted by any court or regulatory authority of competent jurisdiction that would make consummation of the transactions contemplated hereby illegal.

 

5.1.2 By Select if there has been a breach of any representation, warranty, covenant or agreement contained in this Agreement on the part of either Seller such that the conditions set forth in Section 4.1.1 or 4.1.2, as the case may be, would not be satisfied as of such time.

 

5.1.3 By the Sellers if there has been a breach of any representation, warranty, covenant or agreement contained in this Agreement on the part of Select such that the conditions set forth in Section 4.2.1 or 4.2.2, as the case may be, would not be satisfied as of such time.

 

5.1.4 By the Sellers or Select if the Credit Agreement Amendment has not occurred by March 7, 2014; provided, however, if Select is in breach of Section 3.10, it shall not have the right to terminate this Agreement pursuant to this Section 5.1.4.

 

5.2                               Effect of Termination. In the event of a valid termination of this Agreement as provided in Section 5.1, this Agreement shall forthwith become void and there shall be no liability or obligation on the part of Select or the Sellers, or their respective officers, directors or shareholders or affiliates or associates; provided, however, that Select, WCAS IX and WCAS CP IV shall each remain liable for any

 

 

willful breaches by such party of the representations, warranties, covenants or agreements of such party set forth in this Agreement occurring prior to its termination; and provided further that the provisions of Article VI (other than Section 6.6) shall remain in full force and effect and survive any termination of this Agreement.

 

ARTICLE VI
  MISCELLANEOUS

 

6.1                               Survival of Representations, Warranties and Agreements. The covenants, representations and warranties of each party contained herein shall survive the Closing. The representations and warranties of a party (the “Representing Party”) shall not be affected or deemed waived by reason of any investigation made (or not made) by or on behalf of the party benefiting from such representation or warranty (the “Benefiting Party”), including any investigations made (or not made) by any of the Benefiting Party’s advisors, agents, consultants or representatives, or by reason of the fact that the Benefiting Party or any of such advisors, agents, consultants or representatives knew or should have known that any such representation or warranty is or might be inaccurate or untrue.

 

6.2                               Indemnification. Each party agrees to indemnify, defend and hold harmless the other party or parties, as the case may be, its or their respective managers, partners, directors, officers, members, employees, attorneys, accountants, agents and representatives, and its or their respective heirs, successors and permitted assigns from and against all liabilities, losses and damages, together with all reasonable and documented out-of-pocket costs and expenses related thereto (including, without limitation, reasonable and documented out-of-pocket legal fees and expenses), based upon, arising out of, resulting from or otherwise in connection with (a) any material inaccuracy or breach of any representation and warranty of such party herein, or (b) any material breach of any covenant and agreement of such party herein.

 

6.3                               Notices. All notices and other communications by Select or the Sellers hereunder shall be in writing to the other party or parties, as the case may be, and shall be deemed to have been duly given when delivered in person or by an internationally recognized courier service, or sent via telecopy or facsimile transmission and verification received, at the address set forth below or to such other addresses as a party may from time to time designate to the other party or parties, as the case may be, by written notice thereof, effective only upon actual receipt.

 

	
if   to the Sellers:
    	
c/o   Welsh, Carson, Anderson & Stowe
    
	
 
    	
320   Park Avenue,
    
	
 
    	
Suite 2500   New
    
	
 
    	
York,   NY 10022-
    
	
 
    	
6815   Attention:
    
	
 
    	
Jonathan   M. Rather
    
	
 
    	
Facsimile:   (212)
    
	
 
    	
893-9575
    
	
 
    	
 
    
	
with a copy (which shall not constitute notice)   to:
    
	
 
    
	
 
    	
Ropes &   Gray LLP
    
	
 
    	
1211   Avenue of
    
	
 
    	
the   Americas New
    

 

 

	
 
    	
York,   NY 10036-
    
	
 
    	
8704   Attention:
    
	
 
    	
Othon   A. Prounis 
    
	
 
    	
Facsimile:   (646)
    
	
 
    	
728-1513
    
	
 
    	
 
    
	
if   to Select:
    	
Select   Medical Holdings Corporation
    
	
 
    	
4714   Gettysburg Road, P.O. Box
    
	
 
    	
2034
    
	
 
    	
Mechanicsburg,   Pennsylvania
    
	
 
    	
17055
    
	
 
    	
Attention:   Michael E.
    
	
 
    	
Tarvin
    
	
 
    	
Facsimile:   (717) 412-
    
	
 
    	
9142
    
	
 
    	
 
    
	
with a copy (which shall not constitute notice)   to:
    
	
 
    
	
 
    	
Dechert   LLP
    
	
 
    	
2929   Arch
    
	
 
    	
Street
    
	
 
    	
Philadelphia,   PA 19104
    
	
 
    	
Attention:   Stephen M.
    
	
 
    	
Leitzell
    
	
 
    	
Facsimile:   (215) 994-
    
	
 
    	
2222
    

 

6.4                               No Assignment; No Third Party Beneficiaries. Neither this Agreement nor any of the rights, interests or obligations of any party hereunder shall be assigned, delegated or otherwise transferred by any of the parties hereto without the prior written consent of the other party or parties, as the case may be, and any purported assignment, delegation or transfer without such consent shall be null and void. Subject to the preceding sentence, the provisions hereof shall inure to the benefit of, and be binding upon, the successors, permitted assigns, heirs, executors and administrators of the parties hereto. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or the respective successors and permitted assigns, heirs, executors and administrators of the parties hereto any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided by this Agreement, and except as thus expressly provided no person other than the parties hereto or the respective successors and permitted assigns, heirs, executors and administrators of the parties hereto shall have any standing as a third-party beneficiary with respect to this Agreement or the transactions contemplated hereby.

 

6.5                               Severability. If any term, provision, agreement, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other competent authority to be invalid, void or unenforceable, the remainder of the terms, provisions, agreements, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated; provided ,however, that the economic or legal substance of the transactions contemplated hereby not thereby be affected in any manner materially adverse to any

 

 

party hereto. Upon such a determination, the parties shall (subject to the proviso in the preceding sentence) negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a reasonably acceptable manner in order that the transactions contemplated hereby may be consummated as originally contemplated to the fullest extent possible.

 

6.6                             Cooperation; Further Assurances. Select, on the one hand, and the Sellers, on the other hand, at the request of the other such party, shall execute and deliver such other instruments and do and perform such other acts and things as may be reasonably necessary or desirable for effecting completely the consummation of this Agreement and the transactions contemplated hereby. Each party agrees to use commercially reasonable efforts to cause the conditions set forth in Article IV to be satisfied, where the satisfaction of such conditions is within the control of, or depends on action or forbearance from action by such party. From and after the Closing Date, upon the request of Select, on the one hand, or either Seller, on the other hand, such other party, as applicable, shall execute and deliver such instruments, documents or other writings as may be reasonably necessary to confirm and carry out, and to effectuate fully the intent and purposes of, this Agreement.

 

6.7                             Entire Agreement. This Agreement embodies the complete agreement and understanding among the parties hereto with respect to the subject matter hereof, and supersedes and preempts any prior understandings, agreements or representations by or among the parties, written or oral, that may have related to the subject matter hereof in any way.

 

6.8                             Amendments and Waivers. This Agreement may be amended, modified, superseded or canceled, and any of the terms, representations, warranties or covenants hereof may be waived, only by written instrument executed by each of the parties hereto or, in the case of a waiver, by the party waiving compliance.

 

6.9                             Counterparts, Execution, Headings. This Agreement may be executed and delivered (including by facsimile transmission or by electronic mail with a PDF scanned attachment) in one or more counterparts, each of which shall be an original, but all of which together shall constitute one and the same instrument. The article and section headings contained in this Agreement are solely for the purpose of reference, and are not part of the agreement of the parties and shall not in any way affect the meaning or interpretation of this Agreement.

 

6.10                      Construction. Unless the context of this Agreement otherwise requires: (i) words of any gender include each other gender; (ii) words using the singular or plural number also include the plural or singular number, respectively; (iii) the terms “hereof,” “herein,” “hereby” and derivative or similar words refer to this entire Agreement; (iv) the terms “ Article” or “Section” refer to the specified Article or Section of this Agreement; (v) the term “including” means “including without limitation”; (vi) the term “foreign” is used with respect to the United States; and (vii) “dollars” and “$” refer to United States Dollars. Whenever this Agreement refers to a number of days, such number shall refer to calendar days unless business days are specified, and the term “business day” shall mean a day on which banks in the United States are open for business, but excluding Saturdays and Sundays.

 

6.11                        Governing Law. This Agreement, and any claims arising out of or relating to this Agreement, the subject matter hereof or the transactions

 

 

contemplated hereby (whether at law or in equity, whether sounding in contract, tort, statute or otherwise), shall be governed by and construed and enforced in accordance with the laws of the State of Delaware, without regard to, or otherwise giving effect to, any law, body of law or other rule that would cause or otherwise require the application of the laws of any other jurisdiction.

 

6.12                        Venue; Jurisdiction. Any action or proceeding against either Select or any Seller arising out of or relating to this Agreement, the subject matter hereof or the transactions contemplated hereby (whether at law or in equity, whether sounding in contract, tort, statute or otherwise), shall be brought exclusively in the Delaware Court of Chancery (or, if but only if, the Delaware Court of Chancery declines to accept jurisdiction, the Superior Court of the State of Delaware), and Select and the Sellers irrevocably submit to the exclusive jurisdiction and venue of such courts in respect of any such action or proceeding, agree that such courts are convenient forums for such purpose, agree not to transfer or remove any such action or proceeding to any other court, and agree that service of process in any such action or proceeding may be effected in any manner (other than via telecopy or facsimile transmission) by which notices may be delivered pursuant to, and at the address specified in, Section 6.3 hereof, in addition to any other method of service permitted by applicable law. Any actions or proceedings to enforce an order or judgment issued by such courts may be brought in any jurisdiction.

 

6.13 Waiver of Jury Trial. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW THAT CANNOT BE WAIVED, SELECT AND EACH SELLER HEREBY WAIVES AND COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE SUBJECT MATTER HEREOF OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER AT LAW OR IN EQUITY, WHETHER SOUNDING IN CONTRACT, TORT, STATUTE OR OTHERWISE).  SELECT AND EACH SELLER ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTY OR PARTIES, AS THE CASE MAY BE, THAT THIS SECTION 6.13 CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH IT IS RELYING, AND WILL RELY IN ENTERING INTO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY. SELECT OR ANY SELLER MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 6.13 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.

 

6.14 No Strict Construction. The parties have participated jointly in the negotiation and drafting of this Agreement with counsel sophisticated in transactions of this type. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions of this Agreement.

 

6.15 Publicity. Select and the Sellers shall consult with each other before issuing any press release with respect to the transactions contemplated hereby and shall not issue any such press release or make any such public statement without the prior consent of the other party or parties, as the case may be; provided ,however, a

 

 

party may, without the prior consent of the other party or parties, as the case may be (but after prior consultation, to the extent practicable in the circumstances), issue such press release or make such public statement upon the advice of outside counsel to such party, as may be required by law.

 

6.16 Expenses. The Sellers and Select shall bear their own expenses and legal fees incurred on their behalf with respect to this Agreement and the transactions contemplated hereby.

 

6.17 Specific Performance. The parties hereto agree that if any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached, irreparable damage would occur, no adequate remedy at law would exist and damages would be difficult to determine, and that the parties hereto shall be entitled (without necessity of posting bond or other security) to injunctive relief to prevent breaches of, and to specific performance of, the provisions hereof, in addition to any other remedy at law or in equity. The rights and remedies of the parties hereto shall be cumulative (and not alternative).

 

[The remainder of this page has been intentionally left blank.]

 

 

IN WITNESS WHEREOF, Select and the Sellers have caused this Agreement to be duly executed as of the date hereof:

 

 

	
 
    	
SELECT MEDICAL HOLDINGS CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Michael E. Tarvin
    
	
 
    	
Name:
    	
Michael E. Tarvin
    
	
 
    	
Title:
    	
Executive Vice   President, General Counsel and Secretary
    

 

 

	
 
    	
SELLERS:
    
	
 
    	
 
    
	
 
    	
WELSH, CARSON, ANDERSON & STOWE IX, L.P.
    
	
 
    	
 
    
	
 
    	
BY:
    	
WCAS IX ASSOCIATES LLC,
    
	
 
    	
 
    	
ITS GENERAL PARTNER
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Jonathan Rather
    
	
 
    	
Name:
    	
Jonathan Rather
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
WCAS CAPITAL PARTNERS IV, L.P.
    
	
 
    	
 
    
	
 
    	
BY:
    	
WCAS CP IV ASSOCIATES LLC,
    
	
 
    	
 
    	
ITS GENERAL   PARTNER
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Jonathan Rather
    
	
 
    	
Name:
    	
Jonathan Rather
    
	
 
    	
Title:
    	
 
    
				

 

[Signature Page to Stock Purchase Agreement]

 

 

SCHEDULE I

 

PURCHASED SHARES

 

	
Seller
    	
 
    	
Price per
   Purchased
   Share
    	
 
    	
# of Purchased Shares
   By Select Medical
   Holdings Corporation
    	
 
    	
Total
    	
 
    
	
WELSH, CARSON,   ANDERSON & STOWE IX, L.P.
    	
 
    	
$
    	
10.95
    	
 
    	
9,571,108
    	
 
    	
$
    	
104,803,632.60
    	
 
    
	
WCAS CAPITAL PARTNERS   IV, L.P.
    	
 
    	
$
    	
10.95
    	
 
    	
428,892
    	
 
    	
$
    	
4,696,367.40
    	
 
    
	
TOTAL:
    	
 
    	
 
    	
 
    	
10,000,000
    	
 
    	
$
    	
109,500,000.00Exhibit 10.2

 

EXECUTION VERSION

 

AMENDMENT NO. 5

 

AMENDMENT NO. 5 (this “Amendment No. 5”), dated as of March 4, 2014, to that certain Credit Agreement, dated as of June 1, 2011 and as amended by Amendment No. 1 dated as of August 8, 2012, the Additional Credit Extension Amendment dated as of August 13, 2012, Amendment No. 2 dated as of November 6, 2012, Amendment No. 3 dated as of February 15, 2013, the Additional Credit Extension Amendment dated as of February 20, 2013 and Amendment No. 4 dated as of June 3, 2013, as amended, supplemented and in effect from time to time (the “Credit Agreement”; capitalized terms used herein and not defined shall have the meanings set forth in the Credit Agreement), among SELECT MEDICAL HOLDINGS CORPORATION (“Holdings”), SELECT MEDICAL CORPORATION (the “Borrower”), JPMORGAN CHASE BANK, N.A., as Administrative Agent and Collateral Agent (the “Administrative Agent” and the “Collateral Agent,” respectively), MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and GOLDMAN SACHS BANK USA, as Co-Syndication Agents, MORGAN STANLEY SENIOR FUNDING, INC. and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Co-Documentation Agents, and the several banks and other financial institutions from time to time party thereto as lenders (the “Lenders”).

 

W  I  T  N  E  S  S  E  T  H:

 

WHEREAS, Section 9.02 of the Credit Agreement permits the Credit Agreement to be amended from time to time;

 

WHEREAS, (i) each Amendment No. 5 Consenting Lender (as defined in Exhibit A) has agreed, on the terms and conditions set forth herein, (x) to have the entire principal amount (or such lesser amount as permitted by the Borrower in consultation with the Arrangers) of its outstanding Series B Tranche B Term Loans, if any, converted into a like principal amount of a Series D Tranche B Term Loan or a Series E Tranche B Term Loan (each as defined in Exhibit A) effective as of the Amendment No. 5 Effective Date (as defined below) and (y) to have the entire principal amount (or such lesser amount as permitted by the Borrower in consultation with the Arrangers) of its outstanding Series C Tranche B Term Loans, if any, converted into a like principal amount of a Series D Tranche B Term Loan or a Series E Tranche B Term Loan effective as of the Amendment No. 5 Effective Date (as defined below) and (ii) if not all Tranche B Lenders are Amendment No. 5 Consenting Lenders, (x) the Additional Series D Tranche B Term Lender has agreed to make an additional Series D Tranche B Term Loan in a principal amount equal to the outstanding principal amount of Series B Tranche B Term Loans held on the Amendment No. 5 Effective Date by Lenders that are not Amendment No. 5 Consenting Lenders, the proceeds of which shall be applied to repay in full the Series B Tranche B Term Loans of such non-consenting Lenders and (y) the Additional Series E Tranche B Term Lender has agreed to make an additional Series E Tranche B Term Loan in a principal amount equal to the outstanding principal amount of Series C Tranche B Term Loans held on the Amendment No. 5 Effective Date by Lenders that are not Amendment No. 5 Consenting Lenders, the proceeds of which shall be applied to repay in full the Series C Tranche B Term Loans of such non-consenting Lenders;

 

NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

 

SECTION ONE.  Amendments.  The Credit Agreement is, effective as of the Amendment No. 5 Effective Date (as defined below), hereby amended to delete the stricken text (indicated textually in the same manner as the following example:  stricken text) and to add the double-underlined text (indicated textually in the same manner as the following example:  double-underlined text) as set forth in the pages of the Credit Agreement attached as Exhibit A hereto.  The Lenders hereby also consent to such

 

 

amendments to the Security Documents as are contemplated by the Credit Agreement (as amended hereby).  Any previously issued Notes, if any, evidencing (x) Converted Series B Tranche B Term Loans are amended to reflect the terms and conditions evidencing the Series D Tranche B Term Loans or Series E Tranche B Term Loans, as applicable, and (y) Converted Series C Tranche B Term Loans are amended to reflect the terms and conditions evidencing the Series D Tranche B Term Loans or the Series E Tranche B Term Loans, as applicable.

 

SECTION TWO.  Conditions to Effectiveness.  This Amendment No. 5 shall become effective as of the date (the “Amendment No. 5 Effective Date”) when, and only when, the following conditions have been satisfied:

 

(i)            this Amendment No. 5 shall have been executed and delivered by the Borrower, Holdings, the other Loan Parties, the Required Lenders and the Administrative Agent;

 

(ii)           (x) the Administrative Agent, the Borrower and the Additional Series D Tranche B Term Lender (as defined in Exhibit A) shall have entered into the Additional Series D Tranche B Term Joinder Agreement and (y) the Administrative Agent, the Borrower and the Additional Series E Tranche B Term Lender (as defined in Exhibit A) shall have entered into the Additional Series E Tranche B Term Joinder Agreement;

 

(iii)          the Administrative Agent shall have received copies of the resolutions of the board of directors (or authorized committee thereof) of (x) Holdings, (y) the Borrower and (z) each Subsidiary Loan Party approving and authorizing the execution, delivery and performance of this Amendment No. 5, certified as of the Amendment No. 5 Effective Date by the corporate secretary or an assistant secretary thereof as being in full force and effect without modification or amendment;

 

(iv)          the Administrative Agent shall have received a legal opinion dated the Amendment No. 5 Effective Date from Dechert LLP in form and substance reasonably satisfactory to the Arrangers and the Administrative Agent;

 

(v)           the representations and warranties set forth in Article III of the Credit Agreement and in each other Loan Document shall be true and correct in all material respects (except to the extent any such representation or warranty is qualified by “materially,” “Material Adverse Effect” or a similar term, in which case such representation and warranty shall be true and correct in all respects) on and as of the date hereof (both before and after giving effect to the effectiveness of Amendment No. 5) with the same effect as though made on and as of the date hereof, except to the extent such representations and warranties expressly relate to an earlier date, in which case they shall be true and correct in all material respects as of such earlier date (provided that the sol vency representation will be deemed to have been made on the Amendment No. 5 Effective Date after giving effect to the effectiveness of Amendment No. 5);

 

(vi)          to the extent not previously delivered, each Additional Series D Tranche B Term Lender, each Additional Series E Tranche B Term Lender and the Administrative Agent shall have received at least 3 business days prior to the date hereof all documentation and other information about the Borrower and the Subsidiary Loan Parties required under applicable “know your customer” and anti-money laundering rules and regulations, including the PATRIOT Act that has been requested in writing at least 5 business days prior to the date hereof;

 

2

 

(vii)         the Administrative Agent shall have received a Borrowing Request in respect of (x) the Series D Tranche B Term Loans and (y) the Series E Tranche B Term Loans, in each case as required by Section 2.03 of the Credit Agreement;

 

(viii)        immediately prior to and after giving effect to the effectiveness of Amendment No. 5, no Default has occurred or is continuing or shall result from the effectiveness of Amendment No. 5;

 

(ix)          the Administrative Agent shall have received payment of all fees and out-of-pocket expenses required to be paid or reimbursed by Borrower as separately agreed by Borrower and J.P. Morgan Securities LLC (“J.P. Morgan”) and Goldman Sachs Lending Partners LLC (“Goldman”), Merrill Lynch, Pierce, Fenner & Smith Incorporated (“ML”), Morgan Stanley Senior Funding, Inc. (“MS”), Wells Fargo Securities, LLC (“Wells”) and RBC Capital Markets, LLC (“RBC” and together with J.P. Morgan, Goldman, ML, MS and Wells, collectively, the “Arrangers”), and reimbursement or payment of all reasonable out-of-pocket expenses (including the reasonable fees, charges and disbursements of Cahill Gordon & Reindel LLP) required to be reimbursed or paid by any Loan Party hereunder or under any other Loan Document, in each case to the extent such out-of-pocket expenses have been invoiced; and

 

(x)           to the extent not previously delivered, (i) the Administrative Agent shall have received a completed “Life-of-Loan” Federal Emergency Management Agency Standard Flood Hazard Determination with respect to each Mortgaged Property (together with a notice about special flood hazard area status and flood disaster assistance, if applicable, duly executed by the Borrower and each Loan Party relating thereto) and (ii) the Administrative Agent shall have received a copy of, or a certificate as to coverage under, the insurance policies required by Section 5.07 of the Credit Agreement including, without limitation, flood insurance policies (to the extent required in order to comply with applicable law) and the applicable provisions of the Security Documents, each of which shall be endorsed or otherwise amended to include a “standard” or “New York” lender’s loss payable or mortgagee endorsement (as applicable) and shall name the Collateral Agent, on behalf of the Secured Parties, as additional insured, in form and substance reasonably satisfactory to the Administrative Agent;

 

SECTION THREE.  Representations and Warranties.  In order to induce the Lenders and the Administrative Agent to enter into this Amendment No. 5, the Borrower represents and warrants to each of the Lenders and the Administrative Agent that, after giving effect to this Amendment No. 5, and both before and after giving effect to the transactions contemplated by this Amendment No. 5:

 

(a)           no Default or Event of Default has occurred and is continuing;

 

(b)           the entry into this Amendment No. 5 by (x) Holdings, (y) the Borrower and (z) each other Loan Party has been duly authorized by all necessary corporate or other action of each such entity; and

 

(c)           each of the representations and warranties made by each of the Loan Parties in or pursuant to the Loan Documents is true and correct in all material respects on and as of the date hereof as if made on the date hereof (or, if any such representation or warranty is expressly stated to have been made as of a specific date, in all material respects as of such specific date).

 

SECTION FOUR.  Post-Closing Covenant.  Subject to the provisions of the Collateral and Guarantee Requirement and any applicable limitations in any Loan Document, Borrower hereby agrees with the Administrative Agent to deliver, on or before the date that is:

 

3

 

i.                                          30 days after the Amendment No. 5 Effective Date (or such longer period of time as may be agreed by the Administrative Agent in its sole discretion), with respect to each Mortgaged Property:

 

(A)              an amendment to each existing Mortgage (each, a “Mortgage Amendment”) duly executed and acknowledged by the applicable Loan Party and in form for recording in the recording office where such Mortgage was recorded, together with such certificates, affidavits, questionnaires or returns as shall be required in connection with the recording or filing thereof under applicable law, in each case in form and substance reasonably satisfactory to the Administrative Agent and otherwise approved by the applicable local counsel for filing in the appropriate jurisdiction; and

 

(B)              with respect to each Mortgage Amendment, a datedown endorsement to each existing mortgage title policy (if such endorsement is not available in the jurisdiction, a title search and modification endorsement in lieu thereof) (each, a “Datedown Endorsement,” collectively, the “Datedown Endorsements”) relating to the Mortgaged Property subject to such Mortgage insuring the Administrative Agent that such Mortgage, as amended by such Mortgage Amendment is a valid and enforceable first priority lien on such Mortgaged Property in favor of the Collateral Agent for the benefit of the Secured Parties and that there are no Liens of record in violation of the provisions of the Loan Documents, and such Datedown Endorsement shall otherwise be in form and substance reasonably satisfactory to the Administrative Agent.

 

SECTION FIVE.  Reference to and Effect on the Loan Documents.  On and after the Amendment No. 5 Effective Date, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof” or words of like import referring the Credit Agreement, and each reference in the Notes and each of the other Loan Documents to “the Credit Agreement,” “thereunder,” “thereof” or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended by this Amendment No. 5.  The Credit Agreement, the Notes and each of the other Loan Documents, as specifically amended by this Amendment No. 5, are and shall continue to be in full force and effect.  The execution, delivery and effectiveness of this Amendment No. 5 shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or any Agent under any of the Loan Documents, nor constitute a waiver of any provision of any of the Loan Documents.

 

SECTION SIX.  Reaffirmation.  Each Loan Party (x) hereby expressly acknowledges the terms of this Amendment and reaffirms, as of the date hereof, the covenants and agreements contained in each Loan Document to which it is a party, including, in each case, such covenants and agreements as in effect immediately after giving effect to this Amendment No. 5 and the transactions contemplated hereby, (y) by its signature below, hereby affirms and confirms (a) its obligations under each of the Loan Documents to which it is a party, and (b) the pledge of and/or grant of a security interest in its assets which are Collateral to secure such Obligations, all as provided in the Security Documents as originally executed, and acknowledges and agrees that such guarantee, pledge and/or grant shall continue in full force and effect in respect of, and to secure, such Obligations under the Credit Agreement and the other Loan Documents and (z) acknowledges and agrees that each of the Loan Documents in existence as of the date hereof shall be henceforth read and construed in accordance with and so as to give full force and effect to the ratifications, confirmations, acknowledgements and agreements made herein.

 

4

 

SECTION SEVEN.  Costs, Expenses and Taxes.  The Borrower agrees to pay all reasonable out-of-pocket expenses incurred by the Administrative Agent in connection with the preparation, execution and delivery of this Amendment No. 5 and the other instruments and documents to be delivered hereunder, if any (including, without limitation, the reasonable fees, charges and disbursements of Cahill Gordon & Reindel LLP, counsel to the Administrative Agent) in accordance with the terms of Section 9.03 of the Credit Agreement.

 

SECTION EIGHT.  Execution in Counterparts.  This Amendment No. 4 may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  Delivery of an executed counterpart of a signature page to this Amendment No. 5 by telecopy or other electronic transmission shall be effective as delivery of a manually executed counterpart of this Amendment No. 5.

 

SECTION NINE.  Governing Law.  THIS AMENDMENT NO. 5 AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT NO. 5 SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

 

[Signature Pages Follow]

 

5

 

	
 
    	
SELECT   MEDICAL CORPORATION,
    
	
 
    	
as   the Borrower
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joel T. Veit
    
	
 
    	
 
    	
Name:
    	
Joel   T. Veit
    
	
 
    	
 
    	
Title:
    	
Senior   Vice President and Treasurer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
SELECT   MEDICAL HOLDINGS CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joel T. Veit
    
	
 
    	
 
    	
Name:
    	
Joel   T. Veit
    
	
 
    	
 
    	
Title:   
    	
Senior   Vice President and Treasurer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
EACH   OF THE SUBSIDIARIES LISTED ON SCHEDULE I HERETO
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Joel T. Veit
    
	
 
    	
 
    	
Name:
    	
Joel   T. Veit
    
	
 
    	
 
    	
Title:
    	
Vice   President
    

 

S-1

 

	
 
    	
JPMORGAN   CHASE BANK, N.A.,
    
	
 
    	
as   Administrative Agent
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Dawn Lee Lum
    
	
 
    	
 
    	
Name:
    	
Dawn   Lee Lum
    
	
 
    	
 
    	
Title:
    	
Executive   Director
    

 

S-2

 

SCHEDULE I
 TO AMENDMENT NO. 5

 

SUBSIDIARY LOAN PARTIES

 

	
Group 1
    	
 
    
	
 
    	
 
    
	
 
    	
1.
    	
Advantage   Rehabilitation Clinics, Inc.
    
	
 
    	
2.
    	
American   Transitional Hospitals, Inc.
    
	
 
    	
3.
    	
Baseline   Rehabilitation, Inc.
    
	
 
    	
4.
    	
C.E.R. -   West, Inc.
    
	
 
    	
5.
    	
Community Rehab   Centers of Massachusetts, Inc.
    
	
 
    	
6.
    	
Crowley Physical   Therapy Clinic, Inc.
    
	
 
    	
7.
    	
Dade   Prosthetics & Orthotics, Inc.
    
	
 
    	
8.
    	
Douglas   Avery & Associates, Ltd.
    
	
 
    	
9.
    	
Eagle Rehab   Corporation
    
	
 
    	
10.
    	
Fine,   Bryant & Wah, Inc.
    
	
 
    	
11.
    	
Georgia Physical   Therapy, Inc.
    
	
 
    	
12.
    	
Gulf Breeze   Physical Therapy, Inc.
    
	
 
    	
13.
    	
Hospital Holdings   Corporation
    
	
 
    	
14.
    	
Indianapolis   Physical Therapy and Sports Medicine, Inc.
    
	
 
    	
15.
    	
Intensiva   Healthcare Corporation
    
	
 
    	
16.
    	
Intensiva Hospital   of Greater St. Louis, Inc.
    
	
 
    	
17.
    	
Johnson Physical   Therapy, Inc.
    
	
 
    	
18.
    	
Joyner Sportsmedicine   Institute, Inc.
    
	
 
    	
19.
    	
Kentucky   Rehabilitation Services, Inc.
    
	
 
    	
20.
    	
Kessler Institute   for Rehabilitation, Inc.
    
	
 
    	
21.
    	
Kessler   Orthotic & Prosthetic Services, Inc.
    
	
 
    	
22.
    	
Kessler Rehab   Centers, Inc.
    
	
 
    	
23.
    	
Kessler   Rehabilitation Corporation
    
	
 
    	
24.
    	
Kessler   Rehabilitation Services, Inc.
    
	
 
    	
25.
    	
Madison   Rehabilitation Center, Inc.
    
	
 
    	
26.
    	
Metro   Rehabilitation Services, Inc.
    
	
 
    	
27.
    	
Metro   Therapy, Inc.
    
	
 
    	
28.
    	
New England   Rehabilitation Center of Southern New Hampshire, Inc.
    
	
 
    	
29.
    	
NovaCare   Occupational Health Services, Inc.
    

 

 

	
 
    	
30.
    	
NovaCare   Outpatient Rehabilitation East, Inc.
    
	
 
    	
31.
    	
NovaCare   Outpatient Rehabilitation, Inc.
    
	
 
    	
32.
    	
NovaCare   Rehabilitation of Ohio, Inc.
    
	
 
    	
33.
    	
NovaCare   Rehabilitation, Inc.
    
	
 
    	
34.
    	
Pacific   Rehabilitation & Sports Medicine, Inc.
    
	
 
    	
35.
    	
PR Acquisition   Corporation
    
	
 
    	
36.
    	
Pro Active Therapy   of North Carolina, Inc.
    
	
 
    	
37.
    	
Pro Active Therapy   of South Carolina, Inc.
    
	
 
    	
38.
    	
Pro Active Therapy   of Virginia, Inc.
    
	
 
    	
39.
    	
Pro Active   Therapy, Inc.
    
	
 
    	
40.
    	
Professional   Sports Care Management, Inc.
    
	
 
    	
41.
    	
Professional   Therapeutic Services, Inc.
    
	
 
    	
42.
    	
Professional   Therapy Systems, Inc.
    
	
 
    	
43.
    	
PTSMA, Inc.
    
	
 
    	
44.
    	
RCI   (Michigan), Inc.
    
	
 
    	
45.
    	
RCI   (WRS), Inc.
    
	
 
    	
46.
    	
Regency Management   Company, Inc.
    
	
 
    	
47.
    	
Rehab Provider   Network - East I, Inc.
    
	
 
    	
48.
    	
Rehab Provider   Network - East II, Inc.
    
	
 
    	
49.
    	
Rehab Provider   Network - Indiana, Inc.
    
	
 
    	
50.
    	
Rehab Provider   Network - New Jersey, Inc.
    
	
 
    	
51.
    	
Rehab Provider   Network - Pennsylvania, Inc.
    
	
 
    	
52.
    	
Rehab Provider   Network of Colorado, Inc.
    
	
 
    	
53.
    	
Rehab Provider   Network of Florida, Inc.
    
	
 
    	
54.
    	
Rehab Provider   Network of New Mexico, Inc.
    
	
 
    	
55.
    	
Rehab Provider   Network of North Carolina, Inc.
    
	
 
    	
56.
    	
Rehab Provider   Network of South Carolina, Inc.
    
	
 
    	
57.
    	
Rehab Provider   Network of Texas, Inc.
    
	
 
    	
58.
    	
Rehab Provider   Network of Virginia, Inc.
    
	
 
    	
59.
    	
Rehab Provider   Network-Michigan, Inc.
    
	
 
    	
60.
    	
Rehab Provider   Network-Ohio, Inc.
    
	
 
    	
61.
    	
RehabClinics   (GALAXY), Inc.
    
	
 
    	
62.
    	
RehabClinics   (PTA), Inc.
    
	
 
    	
63.
    	
RehabClinics   (SPT), Inc.
    
	
 
    	
64.
    	
RehabClinics, Inc.
    

 

I-2

 

	
 
    	
65.
    	
Rehabilitation   Center of Washington, D.C., Inc.
    
	
 
    	
66.
    	
RPN of   NC, Inc.
    
	
 
    	
67.
    	
S.T.A.R.T., Inc.
    
	
 
    	
68.
    	
Select Employment   Services, Inc.
    
	
 
    	
69.
    	
Select Hospital   Investors, Inc.
    
	
 
    	
70.
    	
Select Medical of   Kentucky, Inc.
    
	
 
    	
71.
    	
Select Medical of   Maryland, Inc.
    
	
 
    	
72.
    	
Select Medical of   New York, Inc.
    
	
 
    	
73.
    	
Select Medical   Rehabilitation Clinics, Inc.
    
	
 
    	
74.
    	
Select Medical   Rehabilitation Services, Inc.
    
	
 
    	
75.
    	
Select NovaCare -   KOP, Inc.
    
	
 
    	
76.
    	
Select NovaCare -   PBG, Inc.
    
	
 
    	
77.
    	
Select NovaCare -   PIT, Inc.
    
	
 
    	
78.
    	
Select Physical Therapy   Holdings, Inc.
    
	
 
    	
79.
    	
Select Physical   Therapy Network Services, Inc.
    
	
 
    	
80.
    	
Select Physical   Therapy of Chicago, Inc.
    
	
 
    	
81.
    	
Select Physical   Therapy Orthopedic Services, Inc.
    
	
 
    	
82.
    	
Select Provider   Networks, Inc.
    
	
 
    	
83.
    	
Select   Rehabilitation Hospital - Hershey, Inc.
    
	
 
    	
84.
    	
Select Specialty   Hospital - Ann Arbor, Inc.
    
	
 
    	
85.
    	
Select Specialty   Hospital - Arizona, Inc.
    
	
 
    	
86.
    	
Select Specialty   Hospital - Augusta, Inc.
    
	
 
    	
87.
    	
Select Specialty   Hospital - Beech Grove, Inc.
    
	
 
    	
88.
    	
Select Specialty   Hospital - Charleston, Inc.
    
	
 
    	
89.
    	
Select Specialty   Hospital - Cincinnati, Inc.
    
	
 
    	
90.
    	
Select Specialty   Hospital - Colorado Springs, Inc.
    
	
 
    	
91.
    	
Select Specialty   Hospital - Columbus, Inc.
    
	
 
    	
92.
    	
Select Specialty   Hospital - Conroe, Inc.
    
	
 
    	
93.
    	
Select Specialty   Hospital - Dallas, Inc.
    
	
 
    	
94.
    	
Select Specialty   Hospital - Danville, Inc.
    
	
 
    	
95.
    	
Select Specialty   Hospital - Denver, Inc.
    
	
 
    	
96.
    	
Select Specialty   Hospital - Durham, Inc.
    
	
 
    	
97.
    	
Select Specialty   Hospital - Erie, Inc.
    
	
 
    	
98.
    	
Select Specialty   Hospital - Evansville, Inc.
    
	
 
    	
99.
    	
Select Specialty   Hospital - Flint, Inc.
    

 

I-3

 

	
 
    	
100.
    	
Select Specialty   Hospital - Fort Smith, Inc.
    
	
 
    	
101.
    	
Select Specialty   Hospital - Fort Wayne, Inc.
    
	
 
    	
102.
    	
Select Specialty   Hospital - Gainesville, Inc.
    
	
 
    	
103.
    	
Select Specialty   Hospital - Greensboro, Inc.
    
	
 
    	
104.
    	
Select Specialty   Hospital - Grosse Pointe, Inc.
    
	
 
    	
105.
    	
Select Specialty   Hospital - Jackson, Inc.
    
	
 
    	
106.
    	
Select Specialty   Hospital - Johnstown, Inc.
    
	
 
    	
107.
    	
Select Specialty   Hospital - Kalamazoo, Inc.
    
	
 
    	
108.
    	
Select Specialty   Hospital - Kansas City, Inc.
    
	
 
    	
109.
    	
Select Specialty   Hospital - Knoxville, Inc.
    
	
 
    	
110.
    	
Select Specialty   Hospital - Laurel Highlands, Inc.
    
	
 
    	
111.
    	
Select Specialty   Hospital - Lexington, Inc.
    
	
 
    	
112.
    	
Select Specialty   Hospital - Little Rock, Inc.
    
	
 
    	
113.
    	
Select Specialty   Hospital - Longview, Inc.
    
	
 
    	
114.
    	
Select Specialty   Hospital - Macomb County, Inc.
    
	
 
    	
115.
    	
Select Specialty   Hospital - Madison, Inc.
    
	
 
    	
116.
    	
Select Specialty   Hospital - McKeesport, Inc.
    
	
 
    	
117.
    	
Select Specialty   Hospital - Memphis, Inc.
    
	
 
    	
118.
    	
Select Specialty   Hospital - Midland, Inc.
    
	
 
    	
119.
    	
Select Specialty   Hospital - Milwaukee, Inc.
    
	
 
    	
120.
    	
Select Specialty   Hospital - Nashville, Inc.
    
	
 
    	
121.
    	
Select Specialty   Hospital - North Knoxville, Inc.
    
	
 
    	
122.
    	
Select Specialty   Hospital - Northeast New Jersey, Inc.
    
	
 
    	
123.
    	
Select Specialty   Hospital - Northeast Ohio, Inc.
    
	
 
    	
124.
    	
Select Specialty   Hospital - Northwest Detroit, Inc.
    
	
 
    	
125.
    	
Select Specialty   Hospital - Oklahoma City, Inc.
    
	
 
    	
126.
    	
Select Specialty   Hospital - Omaha, Inc.
    
	
 
    	
127.
    	
Select Specialty   Hospital - Orlando, Inc.
    
	
 
    	
128.
    	
Select Specialty   Hospital - Palm Beach, Inc.
    
	
 
    	
129.
    	
Select Specialty   Hospital - Panama City, Inc.
    
	
 
    	
130.
    	
Select Specialty   Hospital - Pensacola, Inc.
    
	
 
    	
131.
    	
Select Specialty   Hospital - Phoenix, Inc.
    
	
 
    	
132.
    	
Select Specialty   Hospital - Pittsburgh/UPMC, Inc.
    
	
 
    	
133.
    	
Select Specialty   Hospital - Pontiac, Inc.
    
	
 
    	
134.
    	
Select Specialty   Hospital - Quad Cities, Inc.
    

 

I-4

 

	
 
    	
135.
    	
Select Specialty   Hospital - Saginaw, Inc.
    
	
 
    	
136.
    	
Select Specialty   Hospital - San Antonio, Inc.
    
	
 
    	
137.
    	
Select Specialty   Hospital - Savannah, Inc.
    
	
 
    	
138.
    	
Select Specialty   Hospital - Sioux Falls, Inc.
    
	
 
    	
139.
    	
Select Specialty   Hospital - South Dallas, Inc.
    
	
 
    	
140.
    	
Select Specialty   Hospital - Springfield, Inc.
    
	
 
    	
141.
    	
Select Specialty   Hospital - Tallahassee, Inc.
    
	
 
    	
142.
    	
Select Specialty   Hospital - Topeka, Inc.
    
	
 
    	
143.
    	
Select Specialty   Hospital - TriCities, Inc.
    
	
 
    	
144.
    	
Select Specialty   Hospital - Tulsa, Inc.
    
	
 
    	
145.
    	
Select Specialty   Hospital - Western Michigan, Inc.
    
	
 
    	
146.
    	
Select Specialty   Hospital - Western Missouri, Inc.
    
	
 
    	
147.
    	
Select Specialty   Hospital - Wichita, Inc.
    
	
 
    	
148.
    	
Select Specialty   Hospital - Wilmington, Inc.
    
	
 
    	
149.
    	
Select Specialty   Hospital - Winston-Salem, Inc.
    
	
 
    	
150.
    	
Select Specialty   Hospital - Youngstown, Inc.
    
	
 
    	
151.
    	
Select Specialty   Hospital - Zanesville, Inc.
    
	
 
    	
152.
    	
Select Specialty   Hospitals, Inc.
    
	
 
    	
153.
    	
Select   Subsidiaries, Inc.
    
	
 
    	
154.
    	
Select   Synergos, Inc.
    
	
 
    	
155.
    	
Select   Transport, Inc.
    
	
 
    	
156.
    	
Select Unit   Management, Inc.
    
	
 
    	
157.
    	
SemperCare, Inc.
    
	
 
    	
158.
    	
Sports &   Orthopedic Rehabilitation Services, Inc.
    
	
 
    	
159.
    	
The Rehab   Group, Inc.
    
	
 
    	
160.
    	
Theraworks, Inc.
    
	
 
    	
161.
    	
Victoria   Healthcare, Inc.
    
	
 
    	
162.
    	
OHRH ES, Inc.
    
	
 
    	
163.
    	
GRSH ES, Inc.
    
	
 
    	
164.
    	
Select Specialty   Hospital — Daytona Beach, Inc.
    
	
 
    	
165.
    	
Select Specialty   Hospital — Melbourne, Inc.
    
	
 
    	
166.
    	
GH General — San   Antonio, LLC
    
	
 
    	
167.
    	
GR General —   Scottsdale, LLC
    

 

I-5

 

	
Group 2
    	
 
    
	
 
    	
 
    
	
 
    	
168.
    	
SelectMark, Inc.
    
	
 
    	
169.
    	
SLMC Finance   Corporation
    
	
 
    	
 
    
	
Group 3
    	
 
    
	
 
    	
 
    
	
 
    	
170.
    	
Select Physical   Therapy of Albuquerque, Ltd.
    
	
 
    	
171.
    	
Select Physical   Therapy of Birmingham, Ltd.
    
	
 
    	
172.
    	
Select Physical   Therapy of Blue Springs Limited Partnership
    
	
 
    	
173.
    	
Select Physical   Therapy of Cave Springs Limited Partnership
    
	
 
    	
174.
    	
Select Physical   Therapy of Colorado Springs Limited Partnership
    
	
 
    	
175.
    	
Select Physical   Therapy of Connecticut Limited Partnership
    
	
 
    	
176.
    	
Select Physical   Therapy of Denver, Ltd.
    
	
 
    	
177.
    	
Select Physical   Therapy of Green Bay Limited Partnership
    
	
 
    	
178.
    	
Select Physical   Therapy of Illinois Limited Partnership
    
	
 
    	
179.
    	
Select Physical   Therapy of Kendall, Ltd.
    
	
 
    	
180.
    	
Select Physical   Therapy of Knoxville Limited Partnership
    
	
 
    	
181.
    	
Select Physical   Therapy of Lorain Limited Partnership
    
	
 
    	
182.
    	
Select Physical   Therapy of Louisville, Ltd.
    
	
 
    	
183.
    	
Select Physical   Therapy of Portola Valley Limited Partnership
    
	
 
    	
184.
    	
Select Physical   Therapy of Scottsdale Limited Partnership
    
	
 
    	
185.
    	
Select Physical   Therapy of St. Louis Limited Partnership
    
	
 
    	
186.
    	
Select Physical   Therapy of West Denver Limited Partnership
    
	
 
    	
187.
    	
Select Physical   Therapy Texas Limited Partnership
    
	
 
    	
 
    	
 
    
	
Group 4
    	
 
    
	
 
    	
 
    
	
 
    	
188.
    	
Select Physical   Therapy of Ohio Limited Partnership
    
	
 
    	
189.
    	
Select Physical   Therapy Limited Partnership for Better Living
    
	
 
    	
 
    	
 
    
	
Group 5
    	
 
    
	
 
    	
 
    
	
 
    	
190.
    	
Regency Hospital of Odessa, LLLP
    
	
 
    	
 
    	
 
    
	
Group 6
    	
 
    
	
 
    	
 
    
	
 
    	
191.
    	
Regency Hospital   Company of Macon, L.L.C.
    
	
 
    	
192.
    	
Regency Hospital   Company of Meridian, L.L.C.
    
	
 
    	
193.
    	
Regency Hospital   Company of South Atlanta, L.L.C.
    
	
 
    	
194.
    	
Regency Hospital   Company of South Carolina, L.L.C.
    

 

I-6

 

	
 
    	
195.
    	
Regency Hospital   of Cincinnati, LLC
    
	
 
    	
196.
    	
Regency Hospital   of Columbus, LLC
    
	
 
    	
197.
    	
Regency Hospital   of Covington, LLC
    
	
 
    	
198.
    	
Regency Hospital   of Greenville, LLC
    
	
 
    	
199.
    	
Regency Hospital   of Jackson, LLC
    
	
 
    	
200.
    	
Regency Hospital   of Minneapolis, LLC
    
	
 
    	
201.
    	
Regency Hospital   of North Central Ohio, LLC
    
	
 
    	
202.
    	
Regency Hospital   of North Dallas Holdings, LLC
    
	
 
    	
203.
    	
Regency Hospital   of Northwest Arkansas, LLC
    
	
 
    	
204.
    	
Regency Hospital   of Northwest Indiana, LLC
    
	
 
    	
205.
    	
Regency Hospital   of Southern Mississippi, LLC
    
	
 
    	
206.
    	
Regency Hospital   of Toledo, LLC
    
	
 
    	
207.
    	
Regency Hospital   of Odessa Limited Partner, LLC
    
	
 
    	
208.
    	
Regency Hospital   of Fort Worth Holdings, LLC
    
	
 
    	
 
    	
 
    
	
Group 7
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
209.
    	
Kessler   Professional Services, LLC
    
	
 
    	
210.
    	
Argosy Health, LLC
    
	
 
    	
211.
    	
Select Medical   Property Ventures, LLC
    
	
 
    	
212.
    	
Select Specialty   Hospital — Northern Kentucky, LLC
    
	
 
    	
213.
    	
Select Specialty   Hospital — Tulsa/Midtown, LLC
    
	
 
    	
214.
    	
West Gables   Rehabilitation Hospital, LLC
    
	
 
    	
215.
    	
GP Therapy, L.L.C.
    
	
 
    	
216.
    	
The Rehab Group —   Murfreesboro, LLC
    
	
 
    	
217.
    	
Regency Hospital   Company, L.L.C.
    
	
 
    	
218.
    	
Regency Hospitals,   LLC
    

 

I-7

 

EXHIBIT A

 

[See attached]

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