1
EXHIBIT 10.B
NOVACARE, INC.
0000 XXXX XXXXX XXXXXX
XXXX XX XXXXXXX, XX 00000
November 17, 1997
PNC Bank, National Association,
as Agent
One PNC Plaza
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Attn: Xxxxxx Xxxxxxx, Vice President
RE: Thirteenth Amendment to Credit Agreement (the "Thirteenth
Amendment")
Dear Xxxxxx:
We refer to that certain Credit Agreement, dated as of May 27, 1994, as
amended (the "Credit Agreement"), by and among NovaCare, Inc. ("NovaCare") and
certain of its Subsidiaries, the Banks party thereto and PNC Bank, National
Association, as agent for the Banks ("Agent"). Defined terms used herein, not
otherwise defined herein, shall have the meanings given to them under the Credit
Agreement as amended hereby.
The Borrowers and Guarantors, the Banks and the Agent hereby desire to
amend the Credit Agreement, as hereinafter provided.
The parties hereto in consideration of their mutual covenants and
agreements hereinafter set forth, and intending to be legally bound hereby,
covenant and agree as follows:
AGREEMENT
1. Amendment of Credit Agreement
The parties hereto do hereby modify and amend the Credit Agreement as
follows:
(a) Section 1.01 [Certain Definitions] is hereby amended by
inserting between the definitions of "Multiple Employer Plan" and "Notes" the
following new definition of "NESI Credit Facility", as follows:
"NESI Credit Facility" shall have the meaning assigned to that
term in Section 8.02 (d)."
2
(b) Section 1.01 [Certain Definitions] is hereby amended by
deleting in its entirety the definition of "NovaCare Employee Services, Inc."
and inserting in lieu thereof, the following:
"NovaCare Employee Services, Inc. shall mean collectively
NovaCare Employee Services, Inc., a corporation organized and existing
under the laws of the State of Delaware and all of its Subsidiaries
(whether now existing or hereafter formed or acquired)."
(c) Section 1.01 [Certain Definitions] is hereby amended by
deleting the period at the end of clause (xi)(3) of the definition of "Permitted
Liens", inserting in lieu thereof a ";" and inserting immediately thereafter the
following new clause (xii):
"(xii) For periods on or after the Spin-Off Consummation: (1)
a pledge by NovaCare of the issued and outstanding capital stock of
NovaCare Employee Services, Inc., a Delaware corporation, owned by
NovaCare, such pledge to be in favor of the lenders under the NESI
Credit Facility for so long as loans are outstanding or commitments are
in effect under such facility, and (2) a pledge by NovaCare Employee
Services, Inc., a Delaware corporation and its Subsidiaries of the
issued and outstanding capital stock of the Subsidiaries of NovaCare
Employee Services, Inc., a Delaware corporation, such pledge to be in
favor of the lenders under the NESI Credit Facility for so long as
loans are outstanding or commitments are in effect under such
facility."
(d) Section 1.01 [Certain Definitions] is hereby amended by
deleting in its entirety the definition of "Permitted Line of Business" and
inserting in lieu thereof, the following:
"Permitted Line of Business shall mean, for any period through
but not including the date of the Spin-Off Consummation, the business
engaged in by NovaCare and its Subsidiaries as described in the Annual
Report, SEC Form 10-K of NovaCare and its Subsidiaries, dated June 30,
1997 (the "Existing Business"), and for periods on and after the date
of the Spin-Off Consummation, the Existing Business but expressly
excluding and prohibiting the ownership or operation of Professional
Employment Organizations, other than the continued ownership of by
NovaCare of common stock of NovaCare Employee Services, Inc., a
Delaware corporation, in accordance with Section 8.02(i)."
(e) Section 1.01 [Certain Definitions] is hereby amended by
deleting in its entirety the definition of "Spin-Off" and inserting in lieu
thereof, the following:
"Spin-Off shall mean that certain transaction pursuant to
which the following shall have occurred: (i) NovaCare shall have either
completed a spin-off of a percentage of its ownership interests in, or
caused the issuance, through an initial public offering of stock, of
additional shares of capital stock of NovaCare Employee Services, Inc.,
a Delaware corporation and as a result of such
2
3
transaction, NovaCare, after giving effect thereto, shall own at least
65% of all of the issued and outstanding equity interests of NovaCare
Employee Services, Inc., a Delaware corporation, and (ii) NovaCare
Employee Services, Inc., a Delaware corporation shall repay all
outstanding Indebtedness as of the Spin-Off Consummation, together with
accrued interest thereon, of NovaCare Employee Services, Inc., a
Delaware corporation to NovaCare."
(f) Section 8.02 (i) [Loans and Investments] is hereby amended
by deleting the last sentence of clause (v) in its entirety and inserting in
lieu thereof, the following:
"Notwithstanding anything contained in this Section 8.02(i) to
the contrary, neither NovaCare nor any other Loan Party shall at any
time on or after the Spin-Off Consummation make any loan or advance to,
purchase, acquire or own any stock, bonds, notes or securities of, or
any other investment or interest in, or make any capital contribution
to, or agree, become or remain liable to do any of the foregoing with
respect to NovaCare Employee Services, Inc., a Delaware corporation,
other than the continued ownership of NovaCare's equity interest of
common stock of NovaCare Employee Services, Inc., a Delaware
corporation, as owned as of the Spin-Off Consummation.
2. Amendment to Schedules.
(a) Schedules. Schedule 1.01(e) [Excluded Entities] and
Schedule 6.01(c) [Subsidiaries] to the Agreement are hereby amended and restated
in their entirety in the form of such Schedules attached hereto as Exhibit I and
Exhibit II, respectively.
3. Conditions of Effectiveness.
The effectiveness of this Thirteenth Amendment is expressly conditioned
upon (i) the Agent's receipt of counterparts of this Thirteenth Amendment duly
executed by the Borrowers, the Guarantors, the Banks, and (ii) the consummation
of the Spin-Off.
This Thirteenth Amendment shall be dated as of and shall be effective
as of the date and year first above written which shall be the date of
satisfaction of all conditions precedent to effectiveness as set forth in this
Section 3.
4. Consent of All Banks; Release of Certain Collateral.
Pursuant to Section 11.01(c) of the Credit Agreement, this Thirteenth
Amendment shall require the written consent of all of the Banks. Pursuant to the
Tenth Amendment to the Credit Agreement, among the Loan Parties, the Agent and
the Banks, dated as of March 31, 1997, the Banks authorized the Agent to
automatically release the pledge of the stock of NovaCare Employee Services,
Inc., a Delaware corporation effective upon the Spin-Off Consummation. The Banks
hereby authorize the Agent to automatically release the pledge of the stock of
the Subsidiaries of NovaCare Employee Services, Inc., also effective upon the
Spin-Off
3
4
Consummation, in order that all such shares may be pledged to the lenders under
the NESI Credit Facility.
5. Full Force and Effect.
Except as expressly modified and amended by this Thirteenth Amendment,
the Credit Agreement and the other Loan Documents are hereby ratified and
confirmed and shall remain in full force and effect.
6. Costs, Expenses, Disbursements.
The Borrowers hereby agree to reimburse the Agent and the Banks on
demand for all costs, expenses and disbursements relating to this Thirteenth
Amendment which are payable by the Borrowers as provided in Section 10.05 of the
Credit Agreement.
7. Counterparts.
This Thirteenth Amendment may be executed by different parties hereto
in any number of separate counterparts, each of which, when so executed and
delivered, shall be an original, and all of such counterparts shall together
constitute one and the same instrument.
8. Governing Law.
This Thirteenth Amendment shall be deemed to be a contract under the
laws of the Commonwealth of Pennsylvania and for all purposes shall be governed
by and construed and enforced in accordance with the internal laws of the
Commonwealth of Pennsylvania without regard to its conflict of laws principles.
4
5
[Signature Page 1 of 8 to Thirteenth Amendment]
IN WITNESS WHEREOF, the parties hereto, by their officers thereunto
duly authorized, have executed this Amendment as of the day and year first above
written.
BORROWERS AND GUARANTORS:
ATTEST: NOVACARE, INC., a Delaware corporation, and
each of the other BORROWERS listed on
Schedule 6.01(c) of the Credit Agreement
(which Schedule is attached hereto as
Exhibit II) and each of the GUARANTORS
listed on Schedule 6.01(c) of the Credit
Agreement (which Schedule is attached hereto
as Exhibit II), other than those listed
below
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxxxx X. XxXxxxxx
----------------------- ----------------------------
Name: Xxxxxxx X. XxXxxxxx
[Seal] Title: the Vice President
of each Borrower and Guarantor listed on
Schedule 6.01(c) of the Credit Agreement
(which Schedule is attached hereto as
Exhibit II), other than those listed below,
which is a corporation and of each general
partner of each Borrower and Guarantor which
is a partnership
Address for Notices for each of the
foregoing Borrowers and Guarantors:
0000 Xxxx Xxxxx Xxxxxx
Xxxx xx Xxxxxxx, XX 00000
Telecopier No. (000) 000-0000
Attention: Chief Financial Officer
Telephone No. (000) 000-0000
6
[Signature Page 2 of 8 to Thirteenth Amendment]
AGENT:
PNC BANK, NATIONAL ASSOCIATION, as Agent
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------
Title: Vice President
Address for Notices:
One PNC Plaza
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Telecopier No. (000) 000-0000
Attention: Regional Healthcare Group
Telephone No. (000) 000-0000
BANKS:
PNC BANK, NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------
Title: Vice President
Address for Notices:
One PNC Plaza
000 Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Telecopier No. (000) 000-0000
Attention: Regional Healthcare Group
Telephone No. (000) 000-0000
7
[Signature Page 3 of 8 to Thirteenth Amendment]
CORESTATES BANK, N.A.
By: /s/ Xxxxxxxx X. Xxxxxxxxx
-------------------------------------
Name: Xxxxxxxx X. Xxxxxxxxx
Title: Vice President
Address for Notices:
0000 Xxxxxxxx Xxxxxx
X.X. Xxx 0000
FC 1-8-3-22
Xxxxxxxxxxxx, XX 00000
Telecopier No. (000) 000-0000
Attention: Xxxxxxxx X. Xxxxxxxxx
Assistant Vice President
Telephone No. (000) 000-0000
FIRST UNION NATIONAL BANK
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President
Address for Notices:
One First Union Center
000 X. Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000
Telecopier No. (000) 000-0000
Attention: Xxxxxxx Xxxxx
Assistant Vice President
Telephone No. (000) 000-0000
8
[Signature Page 4 of 8 to Thirteenth Amendment]
FLEET NATIONAL BANK
By: /s/ Xxxx X. Xxxx
------------------------------
Name: Xxxx X. Xxxx
Title: Assistant Vice President
Address for Notices:
Health Care and Institutions Group
Fleet Center MA BOF 00X
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000-0000
Telecopier No. (000) 000-0000
Attention: Xxxxxxx X. Xxxxx
Vice President
Telephone No. (000) 000-0000
MELLON BANK, N.A.
By: /s/ Xxxxxxx Cunnife
------------------------------
Name: Xxxxxxx Cunnife
Title: Assistant Vice President
Address for Notices:
Healthcare Banking
Plymouth Meeting/Exec. Campus
000 X. Xxxxxxxxxx Xxxx
Xxxxx 000/XXX #00X-0000
Xxxxxxxx Xxxxxxx, XX 00000
Telecopier No. (000) 000-0000
Attention: Xxxxxxx Xxxxxxxx
Assistant Vice President
Telephone No. (000) 000-0000
9
[Signature Page 5 of 8 to Thirteenth Amendment]
NATIONSBANK, N.A.
By: /s/ Xxxxx Xxxxxx
-----------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
Address for Notices:
Healthcare Finance Group
Xxx XxxxxxxXxxx Xxxxx
Xxxxx Xxxxx
Xxxxxxxxx, XX 00000-0000
Telecopier No. (000) 000-0000
Attention: Xxxxx Xxxxxx
Vice President
Telephone No. (000) 000-0000
THE BANK OF NEW YORK
By: /s/ Xxxxx X. Xxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
Address for Notices:
Northeast Division
Xxx Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopier No. (000) 000-0000
Attention: Xxxxx Xxxxxx
Vice President
Telephone No. (000) 000-0000
10
[Signature Page 6 of 8 to Thirteenth Amendment]
SUNTRUST BANK, CENTRAL FLORIDA, N.A.
By: /s/ Xxxxx X. Xxxxxxx
----------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
Address for Notices:
Healthcare Banking Group
0-1101, Tower 10
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telecopier No. (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx
First Vice President
Telephone No. (000) 000-0000
BANK ONE, KENTUCKY, NA
By: /s/ Xxxx X. Xxxxxx
----------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Vice President
Address for Notices:
Internal Zip KY1-2216
000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Telecopier No. (000) 000-0000
Attention: Xxxx Xxxxxx
Xx. Vice President
Telephone No. (000) 000-0000
11
[Signature Page 7 of 8 to Thirteenth Amendment]
THE FUJI BANK, LIMITED
NEW YORK BRANCH
By: /s/ Xxxxxxx Xxxx
----------------------------
Name: Xxxxxxx Xxxx
Title: Vice President
Address for Notices:
Xxx Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No. (000) 000-0000
Attention: Xxxxxx X'Xxxxx
Assistant Vice President
Telephone No. (000) 000-0000
CRESTAR BANK
By: /s/ Xxxxx XxXxxxx
----------------------------
Name: Xxxxx XxXxxxx
Title: Vice President
Address for Notices:
000 Xxxx Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxxx, XX 00000-0000
Telecopier No. (000) 000-0000
Attention: Xxxxx XxXxxxx
Vice President
Telephone No. (000) 000-0000
12
[Signature Page 8 of 8 to Thirteenth Amendment]
BANK OF TOKYO - MITSUBISHI TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxx
----------------------------
Name: Xxxxxxx X. Xxxx
Title: Vice President
Address for Notices:
US Corp. Banking Division
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopier No. (000) 000-0000
Attention: Xxx Xxxxx
Vice President
Telephone No. (000) 000-0000
AMSOUTH BANK
By: /s/ J. Xxx XxXxxxx
----------------------------
Name: J. Xxx XxXxxxx
Title: Commercial Banking Officer
Address for Notices:
0000 0xx Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Telecopier No. (000) 000-0000
Attention: Xxx XxXxxxx
Commercial Banking Officer
Telephone No. (000) 000-0000
00
XXXXX XX XXXXXXX
XXXXXX XX XXXXXX
Xx the 3rd day of November, 1997 personally appeared
Xxxxx X. Xxxxxxx, as the Vice President of SunTrust Bank, Central
Florida, National Association, and before me executed the attached Thirteenth
Amendment and Consent dated as of November 17, 1997 to the Credit Agreement
between NovaCare, Inc., with SunTrust Bank, Central Florida, National
Association, as Lender.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal, in
the state and county aforesaid.
/s/ Xxxxx Xxxxx
----------------------------------------
Signature of Notary Public, State of Georgia
Xxxxx Xxxxx
(Print, Type or Stamp Commissioned Name of Notary
Public) Personally known X; OR Produced
Identification Type of identification produced:
_________________________________________________
_________________________________________________