Document:

<PAGE>
                                                                  EXHIBIT 10.13

                            MARINER HEALTH CARE, INC.

                               FIRST AMENDMENT TO
                          CREDIT AND GUARANTY AGREEMENT

                  This FIRST AMENDMENT, dated as of August 9, 2002 (this
"AMENDMENT"), to the Credit and Guaranty Agreement, dated as of May 13, 2002
(the "CREDIT AGREEMENT"), by and among MARINER HEALTH CARE, INC. (F/K/A MARINER
POST-ACUTE NETWORK, INC.), a Delaware corporation ("COMPANY"), CERTAIN
SUBSIDIARIES OF COMPANY, as Guarantors, the Lenders party thereto from time to
time, GOLDMAN SACHS CREDIT PARTNERS L.P. ("GSCP"), as a Joint Lead Arranger (in
such capacity, a "JOINT LEAD ARRANGER"), and as Sole Syndication Agent (in such
capacity, "SYNDICATION AGENT"), UBS WARBURG LLC ("UBSW"), as a Joint Lead
Arranger (in such capacity, a "JOINT LEAD Arranger", and together with GSCP, the
"JOINT LEAD ARRANGERS"), UBS AG, STAMFORD BRANCH ("UBS",) as Administrative
Agent and as Swing Line Lender (together with its permitted successors in such
capacities, "ADMINISTRATIVE AGENT" or "SWING LINE LENDER", respectively),
GENERAL ELECTRIC CAPITAL CORPORATION ("GECC"), as Collateral Monitoring Agent
(together with its permitted successors in such capacity, "COLLATERAL MONITORING
AGENT"), and as Documentation Agent (in such capacity, "DOCUMENTATION AGENT"),
and for the limited purposes of Sections 9.1, 9.6(b) and 10.3 thereof,
RESIDENTIAL FUNDING CORPORATION DBA GMAC-RFC HEALTH CAPITAL ("GMAC"), as Joint
Collateral Agent (together with its permitted successors in such capacity,
"JOINT COLLATERAL AGENT").

         Capitalized terms used herein not otherwise defined herein or otherwise
amended hereby shall have the meanings ascribed thereto in the Credit Agreement.

                                    RECITALS:

         WHEREAS, Company and the Requisite Lenders have agreed to amend the
Credit Agreement, subject to the terms and conditions set forth herein, to make
certain modifications set forth herein.

         NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:

                                       1

<PAGE>

SECTION 1.        AMENDMENTS TO CREDIT AGREEMENT

         1.1      AMENDMENT TO SECTION 1.1: DEFINITIONS. Section 1.1 is hereby
amended as follows:

                  (A) By the addition of the following new definition in its
         appropriate alphabetical order:

                           "'CHARITABLE ORGANIZATION' means any Person that
         qualifies for exemption from federal income taxation under Section
         501(c)(3) of the Internal Revenue Code, or which intends to obtain
         recognition by the Internal Revenue Service as a 501(c)(3) organization
         within the applicable time provided under the Internal Revenue Code,
         including any such Person formed for the purpose of providing disaster
         relief and emergency hardship assistance; provided, however, that any
         such Person which fails to obtain a favorable 501(c)(3) determination
         letter from the Internal Revenue Service within the applicable time
         provided under the Internal Revenue Code, or whose 501(c)(3) status is
         revoked by the Internal Revenue Service, shall cease to be a
         "Charitable Organization" as herein defined."

                  (B) by the deletion of the reference to "Schedule 1.1(iii)"
         from the definition of "Excluded Entities," and by the substitution of
         "Schedule 1.1(ii)" in lieu thereof;

                  (C) By adding the following clause immediately after the
         semicolon at the end of clause (iii) of the definition of
         "Indebtedness", and immediately before clause (iv) of such definition:

                  "provided, however, that drafts under a purchase card program
                  implemented by a Person for the purchase of goods and services
                  in the ordinary course of business shall not constitute
                  Indebtedness if and to the extent the charges evidenced by
                  such drafts (a) are billed to the Person no less frequently
                  than monthly, (b) are paid within 30 days after being invoiced
                  (or if such charges are being contested in good faith by
                  appropriate procedures, are paid within 30 days after such
                  contest is rejected or discontinued), and (c) do not exceed
                  $2,500,000 at any time outstanding;"

                  (D) by the deletion of the cross-reference to "Section 6.8(e)"
         from clause (vi) of the definition of "Permitted Acquisition," and by
         the substitution of "Section 6.9(e)" in lieu thereof; and

                  (E) by the deletion of the punctuational period at the end of
         the definition of "Subsidiary" and the substitution therfor of the
         following:

                                       2

<PAGE>

         "; provided further that no Person shall be deemed to be a Subsidiary
of Company or any Credit Party for so long as (i) such Person constitutes a
Charitable Organization, (ii) such Charitable Organization is not consolidated
with the Company and its consolidated Subsidiaries for financial reporting
purposes under GAAP, and (iii) the aggregate amount of all gifts, loans,
contributions or other Investments made by any Credit Party in or to Charitable
Organizations falling within this proviso shall not exceed $20,000 in aggregate
in any Fiscal Year or $150,000 in aggregate since the Closing Date."

                  1.2      AMENDMENT TO SECTION 5.12: INTEREST RATE PROTECTION.
Section 5.12 of the Credit Agreement is hereby amended by deleting the text in
its entirety and substituting therefore the following:

         "5.12 INTEREST RATE PROTECTION.     No later than February 13, 2003 and
at all times thereafter, Company shall maintain, or cause to be maintained, in
effect one or more Interest Rate Agreements having terms, conditions and tenors,
and being otherwise in form and substance reasonably satisfactory to
Administrative Agent and Syndication Agent, to the extent necessary so that
until the Term Loan Maturity Date interest on Indebtedness in a principal amount
equal to at least 50.0% of the total outstanding funded Indebtedness of the
Company and its consolidated Subsidiaries at any time is effectively fixed or
capped at rates which are reasonably acceptable to the Syndication Agent."

                  1.3      AMENDMENT TO SECTION 5.10: SUBSIDIARIES. Section
5.10(a) of the Credit Agreement is hereby amended by deleting the Section
reference "3.1(r)" at the end of the first sentence thereof and by substituting
"3.1(q)" in lieu thereof.

                  1.4      AMENDMENT TO SECTION 6.2: LIENS. Section 6.2 of the
Credit Agreement is hereby amended by (i) deleting the word "and" at the end of
subsection (r) thereof, (ii) re-designating subsection (s) thereof as subsection
(t), and (iii) adding immediately preceding said subsection (t) the following
additional language as a new subsection (s) of Section 6.2:

                           "(s)     Liens securing the obligations of any Credit
                  Party with respect to any purchase card program, to the extent
                  such obligations are deemed not to constitute Indebtedness by
                  virtue of the proviso contained in clause (iii) of the
                  definition of "Indebtedness" set forth in this Agreement;
                  and".

                  1.5      AMENDMENT TO SECTION 6.15: JOINT VENTURES OR
PARTNERSHIPS. Section 6.15 of the Credit Agreement is hereby amended by deleting
the reference to "Sections 6.7(g) or (i)" and substituting the following:

                           "Sections 6.7(g) or (k)."

SECTION 2.        CONDITIONS PRECEDENT TO EFFECTIVENESS

                                       3

<PAGE>

                  2.1      The effectiveness of the amendments set forth at
Section 1 hereof are subject to the satisfaction, or waiver, of the following
conditions on the date hereof (the "FIRST AMENDMENT CLOSING DATE"):

                  (A)      The Company, the Guarantors and the Requisite Lenders
shall have indicated their consent by the execution and delivery of the
signature pages to the Administrative Agent.

                  (B)      As of the First Amendment Closing Date, after giving
effect to this Amendment, the representations and warranties contained herein
and in the other Credit Documents shall be true, correct and complete in all
material respects on and as of the First Amendment Closing Date to the same
extent as though made on and as of that date, except to the extent such
representations and warranties specifically relate to an earlier date, in which
case such representations and warranties shall have been true, correct and
complete in all material respects on and as of such earlier date.

                  (C)      As of the First Amendment Closing Date, no event
shall have occurred and be continuing that would constitute an Event of Default
or a Default.

                  (D)      The Company shall have paid all fees, costs and
expenses owing to the Administrative Agent, the Syndication Agent and its
counsel invoiced to the Company on or before July 30, 2002, and reimbursable by
the Company under the terms of the Credit Agreement.

SECTION 3.        REPRESENTATIONS AND WARRANTIES

                  3.1      In order to induce Requisite Lenders to enter into
this Amendment, each applicable Credit Party represents and warrants to each
Lender, as of the date hereof and upon giving effect to this Amendment, that:

                  (A) the representations and warranties contained in each of
         the Credit Documents are true, correct and complete in all material
         respects on and as of the date hereof to the same extent as though made
         on and as of that date, except to the extent such representations and
         warranties specifically relate to an earlier date, in which case such
         representations and warranties shall have been true, correct and
         complete in all material respects on and as of such earlier date; and

                  (B) (i) it has all requisite power and authority to enter into
         this Amendment, (ii) the execution, delivery and performance of this
         Amendment have been duly authorized by all necessary action on the part
         of each Credit Party that is a party hereto and to carry out the
         transactions contemplated hereby, and (iii) this Amendment has been
         duly executed and delivered by each Credit Party that is a party hereto
         and is the legally valid and binding obligation of such Credit Party,
         enforceable against such Credit Party in accordance with its respective
         terms.

                                       4

<PAGE>

SECTION 4.        ACKNOWLEDGMENT AND CONSENT

         4.1      Each of the Company and the Guarantors has (i) guaranteed the
Obligations and (ii) created Liens in favor of Lenders on certain Collateral to
secure its obligations under Section 7 of the Credit Agreement. The Company and
the Guarantors are collectively referred to herein as the "Credit Support
Parties", and the Credit Agreement and the Collateral Documents are collectively
referred to herein as the "Credit Support Documents".

         4.2      Each Credit Support Party hereby acknowledges that it has
reviewed the terms and provisions of the Credit Agreement and this Amendment and
consents to the amendment of the Credit Agreement effected pursuant to this
Amendment. Each Credit Support Party hereby confirms that each Credit Support
Document to which it is a party or otherwise bound and all Collateral encumbered
thereby will continue to guarantee or secure, as the case may be, to the fullest
extent possible in accordance with the Credit Support Documents, the payment and
performance of all Guaranteed Obligations under the Credit Agreement and Secured
Obligations (as such term is defined in the Pledge and Security Agreement) under
the Pledge and Security Agreement now or hereafter existing under or in respect
of the Credit Agreement, and grants to the Collateral Agent a continuing lien on
and security interest in and to all Collateral as collateral security for the
prompt payment and performance in full when due of the Guaranteed Obligations
under the Credit Agreement and the Secured Obligations (as such term is defined
in the Pledge and Security Agreement) under the Pledge and Security Agreement
(whether at stated maturity, by acceleration or otherwise).

         4.3      Each Credit Support Party acknowledges and agrees that any of
the Credit Support Documents to which it is a party or otherwise bound shall
continue in full force and effect and that all of its obligations thereunder
shall be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Amendment. Each Credit Support Party
represents and warrants that all representations and warranties contained in the
Amended Agreement and the Credit Support Documents to which it is a party or
otherwise bound are true, correct and complete in all material respects on and
as of the First Amendment Closing Date to the same extent as though made on and
as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case they were true, correct
and complete in all material respects on and as of such earlier date.

         4.4      Each Credit Support Party, other than the Company,
acknowledges and agrees that (i) notwithstanding the conditions to effectiveness
set forth in this Amendment, such Credit Support Party is not required by the
terms of the Credit Agreement or any other Credit Document to consent to the
amendments to the Credit Agreement effected pursuant to this Amendment and (ii)
nothing in the Credit Agreement, this Amendment or any other Credit Document
shall be deemed to require the consent of such Credit Support Party to any
future amendments to the Credit Agreement.

                                       5

<PAGE>

SECTION 5.        MISCELLANEOUS

         5.1      This Amendment shall be binding upon the parties hereto and
their respective successors and assigns and shall inure to the benefit of the
parties hereto and the successors and assigns of Lenders. No Credit Party's
rights or obligations hereunder or any interest therein may be assigned or
delegated by any Credit Party without the prior written consent of all Lenders.

         5.2      In case any provision in or obligation hereunder shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.

         5.3      On and after the First Amendment Closing Date, each reference
in the Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or
words of like import referring to the Credit Agreement, and each reference in
the other Credit 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.

         5.4      Except as specifically amended by this Amendment, the Credit
Agreement and the other Credit Documents shall remain in full force and effect
and are hereby ratified and confirmed.

         5.5      The execution, delivery and performance of this Amendment
shall not, except as expressly provided herein, constitute a waiver of any
provision of, or operate as a waiver of any right, power or remedy of any Agent
or Lender under, the Credit Agreement or any of the other Credit Documents.

         5.6      Section headings herein are included herein for convenience of
reference only and shall not constitute a part hereof for any other purpose or
be given any substantive effect.

         5.7      THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

         5.8      This Amendment may be executed in any number of counterparts,
each of which when so executed and delivered shall be deemed an original, but
all such counterparts together shall constitute but one and the same instrument.
As set forth herein, this Amendment shall become effective upon the execution of
a counterpart hereof by each of the parties hereto and receipt by Company and
Agents of written or telephonic notification of such execution and authorization
of delivery thereof.

            [The remainder of this page is intentionally left blank.]

                                       6

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.

COMPANY:                               MARINER HEALTH CARE, INC.

                                       By: /s/ Boyd P. Gentry
                                          --------------------------------------
                                          Name: Boyd P. Gentry
                                          Title: Senior Vice President and
                                                 Treasurer

<PAGE>

CREDIT SUPPORT PARTIES:  AID & ASSISTANCE, INC.
                         AMERICAN MEDICAL INSURANCE BILLING SERVICES, INC.
                         AMERICAN PHARMACEUTICAL SERVICES, INC.
                         AMERICAN REHABILITY SERVICES, INC.
                         AMERRA PROPERTIES, INC.
                         APS HOLDING COMPANY, INC.
                         APS PHARMACY MANAGEMENT, INC.
                         BEECHWOOD HERITAGE RETIREMENT COMMUNITY, INC.
                         BRIAN CENTER HEALTH & REHABILITATION/TAMPA, INC.
                         BRIAN CENTER HEALTH & RETIREMENT/ALLEGHANY, INC.
                         BRIAN CENTER HEALTH & RETIREMENT/BASTIAN, INC.
                         BRIAN CENTER MANAGEMENT CORPORATION
                         BRIAN CENTER NURSING CARE/AUSTELL, INC.
                         BRIAN CENTER NURSING CARE/FINCASTLE, INC.
                         BRIDE BROOK NURSING & REHABILITATION CENTER, INC.
                         COMPASS PHARMACY SERVICES OF MARYLAND, INC.
                         COMPASS PHARMACY SERVICES OF TEXAS, INC.
                         COMPASS PHARMACY SERVICES, INC.
                         CORNERSTONE HEALTH MANAGEMENT COMPANY
                         DEVCON HOLDING COMPANY
                         EH ACQUISITION CORP. III
                         GCI HEALTH CARE CENTERS, INC.
                         GCI REHAB, INC.
                         GCI THERAPIES, INC.
                         GCI-CAL THERAPIES COMPANY
                         GCI-WISCONSIN PROPERTIES, INC.
                         GRANCARE HOME HEALTH SERVICES, INC.
                         GRANCARE OF MICHIGAN, INC.
                         GRANCARE OF NORTH CAROLINA, INC.
                         GRANCARE SOUTH CAROLINA, INC.
                         GRANCARE, LLC
                         HERITAGE OF LOUISIANA, INC.
                         HOSPICE ASSOCIATES OF AMERICA, INC.
                         IHS REHAB PARTNERSHIP, LTD.
                         LCR, INC.
                         LIVING CENTERS DEVELOPMENT COMPANY
                         LIVING CENTERS LTCP DEVELOPMENT COMPANY
                         LIVING CENTERS OF TEXAS, INC.
                         LIVING CENTERS-EAST, INC.
                         LIVING CENTERS-ROCKY MOUNTAIN, INC.

<PAGE>

                         LIVING CENTERS-SOUTHEAST DEVELOPMENT CORPORATION
                         LIVING CENTERS-SOUTHEAST, INC.
                         LONG RIDGE NURSING AND REHABILITATION CENTER, INC.
                         LONGWOOD REHABILITATION CENTER, INC.
                         MARINER HEALTH AT BONIFAY, INC.
                         MARINER HEALTH CARE MANAGEMENT COMPANY
                         MARINER HEALTH CARE OF ATLANTIC SHORES, INC.
                         MARINER HEALTH CARE OF DELAND, INC.
                         MARINER HEALTH CARE OF FORT WAYNE, INC.
                         MARINER HEALTH CARE OF GREATER LAUREL, INC.
                         MARINER HEALTH CARE OF INVERNESS, INC.
                         MARINER HEALTH CARE OF LAKE WORTH, INC.
                         MARINER HEALTH CARE OF MACCLENNY, INC.
                         MARINER HEALTH CARE OF METROWEST, INC.
                         MARINER HEALTH CARE OF NASHVILLE, INC.
                         MARINER HEALTH CARE OF NORTH HILLS, INC.
                         MARINER HEALTH CARE OF ORANGE CITY, INC.
                         MARINER HEALTH CARE OF PALM CITY, INC.
                         MARINER HEALTH CARE OF PINELLAS POINT, INC.
                         MARINER HEALTH CARE OF PORT ORANGE, INC.
                         MARINER HEALTH CARE OF SOUTHERN CONNECTICUT, INC.
                         MARINER HEALTH CARE OF TOLEDO, INC.
                         MARINER HEALTH CARE OF TUSKAWILLA, INC.
                         MARINER HEALTH CARE OF WEST HILLS, INC.
                         MARINER HEALTH CENTRAL, INC.
                         MARINER HEALTH HOME CARE, INC.
                         MARINER HEALTH MASSACHUSETTS SHELF CORPORATION
                         MARINER HEALTH OF FLORIDA, INC.
                         MARINER HEALTH OF JACKSONVILLE, INC.
                         MARINER HEALTH OF MARYLAND, INC.
                         MARINER HEALTH OF ORLANDO, INC.
                         MARINER HEALTH OF PALMETTO, INC.
                         MARINER HEALTH OF SEMINOLE COUNTY, INC.
                         MARINER HEALTH OF TAMPA, INC.
                         MARINER HEALTH PROPERTIES IV, LTD.
                         MARINER HEALTH RESOURCES, INC.
                         MARINER PHYSICIAN SERVICES, INC.
                         MARINER PRACTICE CORPORATION
                         MARINER SUPPLY SERVICES, INC.
                         MARINER-REGENCY HEALTH PARTNERS, INC.
                         MARINERSELECT STAFFING SOLUTIONS, INC.

<PAGE>

                         MEDREHAB OF INDIANA, INC.
                         MEDREHAB OF LOUISIANA, INC.
                         MEDREHAB OF MISSOURI, INC.
                         MEDREHAB, INC.
                         MED-THERAPY REHABILITATION SERVICES, INC.
                         MERRIMACK VALLEY NURSING & REHABILITATION CENTER, INC.
                         METHUEN NURSING & REHABILITATION CENTER, INC.
                         MHC CONSOLIDATING CORPORATION
                         MHC FLORIDA HOLDING COMPANY
                         MHC GULF COAST HOLDING COMPANY
                         MHC HOLDING COMPANY
                         MHC ILLINOIS, INC.
                         MHC MIDAMERICA HOLDING COMPANY
                         MHC MIDATLANTIC HOLDING COMPANY
                         MHC NORTHEAST HOLDING COMPANY
                         MHC RECRUITING COMPANY
                         MHC REHAB CORP.
                         MHC ROCKY MOUNTAIN HOLDING COMPANY
                         MHC TEXAS HOLDING COMPANY, LLC
                         MHC TRANSPORTATION, INC.
                         MHC WEST HOLDING COMPANY
                         MHC/CSI FLORIDA, INC.
                         MHC/LCA FLORIDA, INC.
                         MYSTIC NURSING & REHABILITATION CENTER, INC.
                         NAN-DAN CORP.
                         NATIONAL HEALTH STRATEGIES, INC.
                         NATIONAL HERITAGE REALTY, INC.
                         THE OCEAN PHARMACY, INC.
                         PARK TERRACE NURSING & REHABILITATION CENTER, INC.
                         PINNACLE CARE CORPORATION OF HUNTINGTON
                         PINNACLE CARE CORPORATION OF NASHVILLE
                         PINNACLE CARE CORPORATION OF WILLIAMS BAY
                         PINNACLE CARE CORPORATION OF WILMINGTON
                         PINNACLE CARE MANAGEMENT CORPORATION
                         PINNACLE PHARMACEUTICAL SERVICES, INC.
                         PINNACLE REHABILITATION OF MISSOURI, INC.
                         PINNACLE REHABILITATION, INC.
                         PHCMI HOLDING COMPANY, LLC
                         PRISM CARE CENTERS, INC.
                         PRISM HEALTH GROUP, INC.
                         PRISM HOME CARE COMPANY, INC.
                         PRISM HOME CARE, INC.
                         PRISM HOME HEALTH SERVICES, INC.

<PAGE>

                         PRISM HOSPITAL VENTURES, INC.
                         PRISM REHAB SYSTEMS, INC.
                         PROFESSIONAL RX SYSTEMS, INC.
                         REGENCY HEALTH CARE CENTER OF SEMINOLE COUNTY, INC.
                         REHABILITY HEALTH SERVICES, INC.
                         RENAISSANCE MENTAL HEALTH CENTER, INC.
                         SASSAQUIN NURSING & REHABILITATION CENTER, INC.
                         SEVENTEENTH STREET ASSOCIATES LIMITED PARTNERSHIP
                         SUMMIT HOSPITAL OF SOUTHEAST ARIZONA, INC.
                         SUMMIT HOSPITAL OF SOUTHWEST LOUISIANA, INC.
                         SUMMIT INSTITUTE FOR PULMONARY MEDICINE AND
                         REHABILITATION, INC.
                         SUMMIT INSTITUTE OF AUSTIN, INC.
                         SUMMIT MEDICAL HOLDINGS, LTD.
                         SUMMIT MEDICAL MANAGEMENT, INC.
                         TAMPA MEDICAL ASSOCIATES, INC.
                         TRI-STATE HEALTH CARE, INC.
                         WINDWARD HEALTH CARE, INC.

                                       By: /s/ Boyd P. Gentry
                                          --------------------------------------
                                          Name: Boyd P. Gentry
                                          Title: Senior Vice President and
                                                 Treasurer

<PAGE>

LENDERS:                               GOLDMAN SACHS CREDIT PARTNERS L.P.,
                                             as a Joint Lead Arranger, Sole
                                             Syndication Agent and a Lender

                                       By: /s/ Stephen B. King
                                          --------------------------------------
                                          Name: Stephen B. King
                                          Title: Senior Vice President and
                                                 Treasurer

<PAGE>

                                       UBS AG, STAMFORD BRANCH,
                                             as Administrative Agent, Swing Line
                                             Lender, Issuing Bank and a Lender

                                       By: /s/ Robert R. Reuter
                                          --------------------------------------
                                          Name: Robert R. Reuter
                                          Title: Executive Director

                                       By: /s/ Kelly Smith
                                          --------------------------------------
                                          Name: Kelly Smith
                                          Title: Director

<PAGE>

                                       GENERAL ELECTRIC CAPITAL
                                       CORPORATION,
                                             as Collateral Monitoring Agent,
                                             Documentation Agent and a Lender,

                                       By: /s/ Brett Robinson
                                          --------------------------------------
                                          Name: Brett Robinson
                                          Title: Vice President

<PAGE>

                                       RESIDENTIAL FUNDING CORPORATION
                                         DBA GMAC-RFC HEALTH CAPITAL,
                                         as Joint Collateral Agent and a Lender

                                       By: /s/ Jeffrey Seiler
                                          --------------------------------------
                                          Name: Jeffrey Seiler
                                          Title: Director

<PAGE>

                                       FOOTHILL INCOME TRUST, L.P., as a Lender
                                       By: FIT GP, LLC, its General Partner

                                       By: /s/ Jeff Nikora
                                          --------------------------------------
                                          Name: Jeff Nikora
                                          Title: Managing Member

<PAGE>

                                       FOOTHILL GROUP, INC.,
                                             as a Lender

                                       By: /s/ Jeff Nikora
                                          --------------------------------------
                                          Name: Jeff Nikora
                                          Title: E.V.P.

<PAGE>

                                       BLUE SQUARE FUNDING LIMITED SERIES 3,
                                       as a Lender
                                       By: Deutsche Bank Trust Co. Americas,
                                           FKA Bankers Trust Co.

                                       By: /s/ Susan N. Anderson
                                          --------------------------------------
                                          Name: Susan N. Anderson
                                          Title: Assistant Vice President

<PAGE>

                                       CALIFORNIA PUBLIC EMPLOYEES
                                       RETIREMENT SYSTEM,
                                             as a Lender

                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:

<PAGE>

                                     ELF FUNDING TRUST 1, as a Lender
                                     By: Highland Capital Management L.P.
                                     As Collateral Manager

                                     By: /s/ Louis Koven
                                        --------------------------------------
                                        Name: Louis Koven
                                        Title: Executive Vice President-CFO
                                               Highland Capital Management, L.P.

<PAGE>

                                     EMERALD ORCHARD LIMITED,
                                           as a Lender

                                     By: /s/ Louis Koven
                                        --------------------------------------
                                        Name: Louis Koven
                                        Title: Executive Vice President-CFO
                                               Highland Capital Management, L.P.

<PAGE>

                                       GLENEAGLES TRADING LLC,
                                             as a Lender

                                       By: /s/ Ann E. Morris
                                          --------------------------------------
                                          Name: Ann E. Morris
                                          Title: Assistant Vice President

<PAGE>

                                     HIGHLAND LEGACY LIMITED, as a Lender
                                     By: Highland Capital Management, L.P.
                                     As Collateral Manager

                                     By: /s/ Louis Koven
                                        --------------------------------------
                                        Name: Louis Koven
                                        Title: Executive Vice President-CFO
                                               Highland Capital Management, L.P.

<PAGE>

                                       HIGHLAND LOAN FUNDING V LTD. L.P.,
                                             as a Lender

                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:

<PAGE>

                                       HIGHLAND LOAN FUNDING VII LTD.,
                                             as a Lender

                                       By:
                                          --------------------------------------
                                          Name:
                                          Title:

<PAGE>

                                       KZH HIGHLAND-2 LLC,
                                             as a Lender

                                       By: /s/ Joyce Frazer-Bryant
                                          --------------------------------------
                                          Name: Joyce Fraser-Bryant
                                          Title: Authorized Agent

<PAGE>

                                       KZH PAMCO-LLC,
                                             as a Lender

                                       By: /s/ Joyce Fraser-Bryant
                                          --------------------------------------
                                          Name: Joyce Fraser-Bryant
                                          Title: Authorized Agent

<PAGE>

                                     RESTORATION FUNDING CLO, LTD., as a
                                     Lender
                                     By: Highland Capital Management, L.P.
                                     As Collateral Manager

                                     By: /s/ Louis Koven
                                        --------------------------------------
                                        Name: Louis Koven
                                        Title: Executive Vice President-CFO
                                               Highland Capital Management, L.P.<PAGE>
                                                                   EXHIBIT 10.14

                    SEPARATION AGREEMENT AND GENERAL RELEASE

         THIS SEPARATION AGREEMENT AND GENERAL RELEASE (this "Agreement") is
made and entered into by and between Susan Thomas Whittle (the "Employee") and
Mariner Post-Acute Network, Inc. (the "Company").

                               STATEMENT OF FACTS

         Employee's employment with the Company will terminate on December 31,
2002. Employee desires to accept the following agreements, including, without
limitation, certain additional consideration from the Company in return for
Employee's general release and non-disclosure agreements set forth below.
Employee and the Company desire to settle fully and finally all differences and
disputes between them, including, but in no way limited to, any differences and
disputes that might arise, or have arisen, out of Employee's employment with the
Company, and the termination thereof.

                               STATEMENT OF TERMS

         In consideration of the mutual promises herein, it is agreed as
follows:

         1.       Non-Admission of Liability. Neither this Agreement nor the
Company's offer to enter into this Agreement shall in any way be construed as an
admission by the Company that it has acted wrongfully with respect to Employee
or any other person, or that Employee has any rights whatsoever against the
Company. The Company specifically disclaims any liability to or wrongful acts
against Employee or any other person, on the part of itself, its employees or
its agents.

         2.       Termination of Employment. Employee represents, understands
and agrees that Employee's employment with the Company will terminate on
December 31, 2002 (the "Separation Date").

         3.       Effective Date. The effective date of this Agreement shall be
the eighth day after Employee signs this Agreement (the "Effective Date"). As of
the Effective Date, if neither party has revoked this Agreement pursuant to
Section 16(e), this Agreement shall be fully effective and enforceable.

         4.       Consideration. In full consideration and as material
inducement for Employee's signing of this Agreement and General Release, the
Company will pay three hundred thirty thousand dollars and no cents
($330,500.00), less legal deductions, over a 52 week period and payable
bi-weekly. Furthermore, the Company will pay the Employee for all earned and
accrued vacation not used by the Employee.

         5.       Consultation. During the 52 week period described in Section
4, Employee shall be available to provide consultation services to the Company
as may be requested by the Chief Executive Officer or the General Counsel.

         6.       Cooperation by Employee. In consideration of the amount paid
to the Employee as provided in Section 4, the Employee agrees to cooperate fully
with the Company in any litigation by or against the Company or other
business-related matters.

                                       1

<PAGE>

         7.       Cessation of Authority. Employee understands and agrees that
as of the Separation Date, Employee is no longer authorized to incur any
expenses, obligations or liabilities, or to make any commitments on behalf of
the Company except those authorized in advance by the Chief Executive Officer or
the General Counsel. Employee agrees to submit to the General Counsel, within
thirty (30) days of the Separation Date, any and all expenses incurred by
Employee through The Separation Date and any and all contracts or other
obligations entered into by Employee on behalf of the Company.

         8.       Return of Company Materials and Property. Employee understands
and agrees that Employee will turn over to the General Counsel, on or before the
Separation Date, all files, memoranda, records, credit cards, manuals, computer
equipment, computer software, pagers, cellular phones, facsimile machines, and
any other equipment and other documents, and all other physical or personal
property that Employee received from the Company and/or that Employee used in
the course of Employee's employment with the Company and that are the property
of the Company or its customers, with the exception of the material and property
determined by the General Counsel to be retained by the Employee to provide
consultation services as described in Section 5.

         9.       Confidential Information and Trade Secrets. Employee agrees to
protect and hold in confidence all Trade Secrets and Confidential Information
("Company Information") belonging to the Company that Employee has received
through or as a result of Employee's employment by the Company or consultation
to the Company and to take no action that may cause any such information to lose
its character as Company Information. Employee shall neither disclose, divulge
nor communicate to any third party any Trade Secrets belonging to the Company.

         For purposes of this Section 9, "Confidential Information" means
confidential data and confidential information relating to the Company's
business (which does not rise to the status of a Trade Secret) which has value
to the Company and is not generally known to its competitors, such as Company
pricing information, marketing information, profit margins, customer
preferences, customer lists, and other marketing and sales information that
would have value if disclosed to competitors. Confidential Information shall not
include any data or information that (i) has been voluntarily disclosed to the
public by the Company, (ii) has been independently developed and disclosed to
the public by others, (iii) otherwise enters the public domain through lawful
means, or (iv) was already known by Employee at the time of disclosure. The
provisions in this Agreement restricting the disclosure and use of Confidential
Information shall survive for a period of two (2) years following the execution
of this Agreement.

         For purposes of this Section 9, "Trade Secrets" means information
including, but not limited to, technical or non-technical data, formulas,
patterns, compilations, programs, devices, methods, techniques, drawings,
processes, financial data, financial plans, product or service plans or lists of
actual or potential customers or suppliers or customer preferences which (1)
derives economic value, actual or potential, from not being generally known to,
and not being readily ascertainable by proper means by, other persons who can
obtain economic value from its disclosure or use; and (2) is the subject of
efforts that are reasonable under the circumstances to maintain its secrecy. The
provisions in this Agreement restricting the disclosure and use of Trade Secrets
shall survive the execution of this Agreement and shall survive for so long as
the respective information qualifies as a trade secret under applicable law.

         10.      Agreement Not To Solicit Employees, Independent Contractors,
or Consultants. Employee represents that Employee has not and that Employee will
not, for a period of one (1) year after the Separation Date, either directly or
indirectly, on Employee's own behalf or on behalf of

                                       2

<PAGE>

others, solicit, divert, or hire away, any person employed by the Company,
whether or not such employee is a full-time or temporary employee of the Company
and whether or not such employment is pursuant to a written agreement for a
determined period of time or at will, or any consultant or independent
contractor engaged by the Company.

         The Employee further agrees that the Employee has not and that the
Employee will not, for a period of one (1) year after the Effective Date, either
directly or indirectly, on the Employee's own behalf or on behalf of others, (1)
contact any referral source or customer of the Company, or other person who
conducts business with the Company at the location(s) at which the Employee
worked for the purpose of inducing or attempting to induce such referral source,
customer or other person to cease doing business with the Company; and (2) call
on, solicit, attempt to obtain, accept, or in any way secure business from any
referral source or customers of the Company who conducts business with the
Company at the location(s)at which the Employee worked, nor, directly or
indirectly, aid or assist any other persons, firm or corporation in the
solicitation of such referral source or customer.

         11.      No Obligation. Employee agrees and understands that the
consideration described above in Section 4 of this Agreement is not required by
the Company's policies and procedures. Employee further agrees and understands
that Employee's entitlement to receive the consideration set forth above is
conditioned upon Employee's execution of this Agreement and compliance with the
terms of this Agreement.

         12.      Severability. The provisions of this Agreement are severable,
and if any part of it is found to be unenforceable, the other paragraphs shall
remain fully valid and enforceable. This Agreement shall survive the termination
of any arrangements contained herein.

         13.      Confidentiality; Professionalism. Employee represents and
agrees that Employee will keep the terms, amount, value, and nature of
consideration paid to Employee, and the fact of this Agreement completely
confidential, and that Employee will not hereafter disclose any information
concerning this Agreement to anyone other than Employee's immediate family and
professional representatives who will be informed of and bound by this
confidentiality clause.

         Employee agrees that Employee will not make or issue, or procure any
person, firm or entity to make or issue, any statement in any form concerning
the Company, Employee's employment relationship or the termination of Employee's
employment relationship with the Company to any person or entity if such
statement is harmful to or disparaging of the Company, its affiliates or any of
their employees, officers, directors, agents or representatives.

         14.      Complete Release. As a material inducement to the Company to
enter into this Separation Agreement and General Release, Employee hereby
irrevocably and unconditionally releases, acquits and forever discharges the
Company and each of the Company's owners, stockholders, predecessors,
successors, assigns, agents, directors, officers, employees, representatives,
attorneys, parent companies, divisions, subsidiaries, affiliates (and agents,
directors, officers, employees, representatives and attorneys of such parent
companies, divisions, subsidiaries and affiliates), and all persons acting by,
through, under or in concert with any of them (collectively "Releasees"), or any
of them, from any and all charges, complaints, claims, liabilities, obligations,
promises, agreements, controversies, damages, actions, causes of action, suits,
rights, demands, costs, losses, debts, and expenses of any nature whatsoever,
known or unknown, suspected or unsuspected, including, but not limited to,
rights arising out of alleged violations or breaches of any contracts, express
or implied, or any tort, or any legal restrictions on the Company's right to
terminate employees, or any federal, state or other governmental statute,
regulation, or ordinance, including,

                                       3

<PAGE>

without limitation: (1) Title VII of the Civil Rights Act of 1964, as amended by
the Civil Rights Act of 1991, (race, color, religion, sex, and national origin
discrimination); (2) the Americans with Disabilities Act (disability
discrimination); (3) 42 U.S.C. ss. 1981 (discrimination); (4) the Age
Discrimination in Employment Act; (5) the Older Workers Benefit Protection Act;
(6) the Equal Pay Act; (7) the Employee Retirement Income Security Act
("ERISA"); (8) Section 503 of the Rehabilitation Act of 1973; (9) the False
Claims Act (including the qui tam provision thereof); (10) the Occupational
Safety and Health Act; (11) the Consolidated Omnibus Budget Reconciliation Act
of 1986; (12) the Worker Adjustment and Retraining Notification Act; (13)
intentional or negligent infliction of emotional distress or "outrage"; (14)
defamation; (15) interference with employment; (16) wrongful discharge; (17)
invasion of privacy; (18) the Georgia Fair Employment Practices Statutes
(Section 45-19-29 et seq of the Georgia Statutes); (19) the Georgia Equal
Employment for Persons with Disabilities Statute (Section 34-6A-4 et seq of the
Georgia Statutes); (20) The Georgia Sex Discrimination in Employment Statute
(Section 34-5-3 of the Georgia Statues); (21) Section 31-8-87 of the Georgia
Statutes; and (22) all applicable Georgia laws ("Claim" or "Claims"), which
Employee now has, owns or holds, or claims to have, own or hold, or which
Employee any time heretofore had, owned or held, or claimed to have, owned or
held, against each or any of the Releasees at any time up to and including the
Effective Date of this Agreement.

         The Company releases the Employee of all claims against the Employee of
which it is or should be aware as of the date this Agreement is executed.

         15.      No Knowledge of Illegal Activity. Employee acknowledges that
she has no knowledge of any actions or inactions by any of the Releasees or by
Employee that Employee believes could possibly constitute a basis for a claimed
violation of any federal, state, or local law, any common law or any rule
promulgated by an administrative body.

         16.      Age Discrimination In Employment Act. Employee hereby
acknowledges and agrees that this Agreement and the termination of Employee's
employment and all actions taken in connection therewith are in compliance with
the Age Discrimination in Employment Act and the Older Workers Benefit
Protection Act and that the releases set forth in Section 15 hereof shall be
applicable, without limitation, to any claims brought under these Acts. Employee
further acknowledges and agrees that:

                  a.       the release given by Employee in this Agreement is
given solely in exchange for the consideration set forth in Section 4 of this
Agreement and such consideration is in addition to anything of value which
Employee was entitled to receive prior to entering into this Agreement;

                  b.       by entering into this Agreement, Employee does not
waive rights or claims that may arise after the date this Agreement is executed;

                  c.       Employee has been advised to consult an attorney
prior to entering into this Agreement, and this provision of this Agreement
satisfies the requirement of the Older Workers Benefit Protection Act that
Employee be so advised in writing;

                  d.       Employee has been offered twenty-one (21) days from
receipt of this Separation Agreement and General Release within which to
consider this Agreement; and

                  e.       For a period of seven (7) days following Employee's
execution of this Agreement, Employee or the Company may revoke this Agreement
and this Agreement shall not become effective or enforceable until such seven
(7) day period has expired.

                                       4
<PAGE>
         17.      Indemnification. As a further material inducement to the
Employee to enter into this Agreement, Company hereby agrees to indemnify and
hold Employee harmless from and against any and all loss, costs, damages, or
expenses, including, without limitation, attorneys' fees incurred by Employee in
the event Employee is or is threatened to, or becomes a party or witness or
other participant in a claim arising out of any event, occurrence or
circumstance related to the fact that Employee is or was a director or officer
of the Company and its subsidiaries, its successors or affiliates, or was
serving at the request of the Company as its agent or consultant.

         18.      No Other Representations. Employee represents and acknowledges
that in executing this Agreement Employee does not rely, and has not relied,
upon any representation or statement not set forth herein made by any of the
Releasees or by any of the Releasees' agents, representatives, or attorneys with
regard to the subject matter, basis or effect of this Agreement or otherwise.

         19.      Sole and Entire Agreement. This Agreement sets forth the
entire agreement between the parties hereto, and supersedes any and all prior
agreements or understandings between the parties pertaining to the subject
matter hereof.

         20.      Binding Effect, Assignment. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective heirs,
representatives, successors, transferees and permitted assigns. This Agreement
shall not be assignable by Employee but shall be freely assignable by the
Company.

         21.      Remedies. Employee agrees that the covenants contained in this
Agreement are of the essence of this Agreement; that each of such covenants is
reasonable and necessary to protect and preserve the business, interests, and
properties of the Company; and that the Company will suffer irreparable loss and
damage should Employee breach any of those covenants. Therefore, Employee agrees
and consents that, in addition to all of the remedies provided at law or in
equity, the Company shall be entitled to a temporary restraining order and
temporary and permanent injunctions to prevent or cure a breach or contemplated
breach of any of those covenants. The existence of any claim, demand, action, or
cause of action of Employee against the Company shall not constitute a defense
the Company's enforcement of any of the covenants or agreements in this
Agreement. In addition to any other remedies, any breach of this Agreement by
the Employee will result in payments to the Employee being immediately
discontinued.

         22.      Knowledgeable Decision By Employee. Employee represents and
warrants that Employee has read all the terms of this Agreement. Employee
understands the terms of this Agreement and understands that this Agreement
releases forever the Company from any legal action arising from Employee's
relationship with the Company as an Employee, and the termination of such
relationship by the Company. Employee is signing and delivering this Agreement
of his or her own free will in exchange for the consideration to be given to
Employee, which Employee acknowledges and agrees is adequate and satisfactory.

         23.      Full and Careful Consideration. Please take this Agreement
home and carefully consider all of its provisions before signing it. You may
take up to twenty-one (21) days to decide whether you want to accept and sign
this Agreement. Also, if you sign this Agreement, you and the Company will then
have until the Separation Date, or an additional seven (7) days after you sign
this Agreement, whichever is longer, in which to revoke this Agreement. This
Agreement will not be effective or enforceable, nor will any consideration be
paid, until after the revocation period has

                                       5
<PAGE>
expired. Again, you are free, and encouraged, to discuss the contents and
advisability of signing this Agreement with an attorney of your choosing.

         PLEASE READ CAREFULLY. THIS SEPARATION AGREEMENT AND GENERAL RELEASE
INCLUDES A RELEASE OF ALL KNOWN AND UNKNOWN CLAMS.

-------------------------           -------------------------------------------
DATE                                EMPLOYEE'S SIGNATURE

                                    ___________________________________________
                                    Susan Thomas Whittle

                                    Mariner Post-Acute Network, Inc.

                                    By:________________________________________

           Effective Date of Agreement: _____________________, 200_.

Witness:

___________________________________

                                       6
<PAGE>

                                 ACKNOWLEDGMENT

I, __________________________________, hereby acknowledge that I was given
twenty-one (21) days to consider the foregoing Agreement and voluntarily chose
to sign the Agreement prior to the expiration of the 21-day period.

         EXECUTED this __ day of _______________, 200_ at __________________,

___________________________ .

                                             ---------------------------

                                             Name:
                                                  ----------------------

                                       7

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