-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VRXPKJnc042k1yezFeAekKcyBzNubjjTf+6QlGm457Sr/nQrTdkvjmKM21VfPIrW RM89u8JFtZvTRuO1CudZZA== 0000904454-04-000816.txt : 20041221 0000904454-04-000816.hdr.sgml : 20041221 20041221125701 ACCESSION NUMBER: 0000904454-04-000816 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20041221 DATE AS OF CHANGE: 20041221 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: SELECT MEDICAL CORP CENTRAL INDEX KEY: 0001035688 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-SPECIALTY OUTPATIENT FACILITIES, NEC [8093] IRS NUMBER: 232872718 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-61617 FILM NUMBER: 041216405 BUSINESS ADDRESS: STREET 1: 4716 OLD GETTYSBURG RD CITY: MECHANICSBURG STATE: PA ZIP: 17055 BUSINESS PHONE: 7179721100 MAIL ADDRESS: STREET 1: 4716 OLD GETTYSBURG RD CITY: MECHANICSBURG STATE: PA ZIP: 17055 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: EGL Holding CO CENTRAL INDEX KEY: 0001306472 IRS NUMBER: 201764048 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 320 PARK AVENUE, SUITE 2500 CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: (212) 893-9500 MAIL ADDRESS: STREET 1: 320 PARK AVENUE, SUITE 2500 CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D/A 1 s13da_12202004select.txt (Page 1 of 33 Pages) SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 SCHEDULE 13D (Rule 13d-101) UNDER THE SECURITIES EXCHANGE ACT OF 1934 (Amendment No. 1)(1) SELECT MEDICAL CORPORATION - -------------------------------------------------------------------------------- (Name of Issuer) Common Stock, $.01 par value - -------------------------------------------------------------------------------- (Title of Class of Securities) 816196 10 9 - -------------------------------------------------------------------------------- (CUSIP Number) Welsh, Carson, Anderson & Stowe IX, L.P. Select Medical Corporation Ropes & Gray LLP 320 Park Avenue, Suite 2500 4716 Old Gettysburg Road 45 Rockefeller Plaza New York, NY 10022 Mechanicsburg, PA 17055 New York, NY 10111 Attn: Jonathan M. Rather Attn: Michael E. Tarvin Attn: Othon A. Prounis Tel: (212) 893-9500 Tel: (717) 972-1100 Tel: (212) 841-5700
- -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) December 20, 2004 - -------------------------------------------------------------------------------- (Date of Event Which Requires Filing of This Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box X (2) Note. Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent. (Continued on following pages) - ------------------------ (1) The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. (2) The filing person who has previously filed a statement on Schedule 13G is Rocco A. Ortenzio. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however,, see the Notes). (Page 2 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS EGL Holding Company EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO/Not Applicable - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 0 SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 0 WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 7,952,227* shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 7,952,227* shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 7.8% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- * Reflects 7,952,227 shares of Common Stock of Select Medical Corporation to be contributed to EGL Holding Company pursuant to (a) the Agreement, dated October 17, 2004, among EGL Holding Company and the various rollover investors referred to therein, (b) the Agreement, dated December 20, 2004, among EGL Holding Company and the various rollover investors referred to therein and (c) an understanding among EGL Holding Company and certain individuals. (Page 3 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Welsh, Carson, Anderson & Stowe IX, L.P. EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO/Not Applicable - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 0 SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 0 WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 7,952,227* shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 7,952,227* shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 7.8% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- * Reflects 7,952,227 shares of Common Stock of Select Medical Corporation to be contributed to EGL Holding Company pursuant to (a) the Agreement, dated October 17, 2004, among EGL Holding Company and the various rollover investors referred to therein, (b) the Agreement, dated December 20, 2004, among EGL Holding Company and the various rollover investors referred to therein and (c) an understanding among EGL Holding Company and certain individuals.. (Page 4 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS WCAS IX Associates, L.L.C. EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO/Not Applicable - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 0 SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 0 WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 7,952,227* shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 7,952,227* shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 7.8% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON OO - -------------------------------------------------------------------------------- * Reflects 7,952,227 shares of Common Stock of Select Medical Corporation to be contributed to EGL Holding Company pursuant to (a) the Agreement, dated October 17, 2004, among EGL Holding Company and the various rollover investors referred to therein, (b) the Agreement, dated December 20, 2004, among EGL Holding Company and the various rollover investors referred to therein and (c) an understanding among EGL Holding Company and certain individuals. (Page 5 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Patrick J. Welsh EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 125,000 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 125,000 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 125,000 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 6 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Russell L. Carson EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 722,960 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 722,960 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 722,960 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less Than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 7 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Bruce K. Anderson EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 618,910 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 618,910 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 618,910 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less Than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 8 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Thomas E. McInerney EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 450,984 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 450,984 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 450,984 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less Than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 9 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Robert A. Minicucci EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 88,626 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 88,626 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 88,626 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less Than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 10 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Anthony J. de Nicola EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 19,483 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 19,483 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 19,483 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less Than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 11 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Thoma Cressey Fund VI, L.P. EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS WC - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 0 SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 2,098,596 shares EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 0 WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 2,098,596 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,098,596 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.1% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- (Page 12 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Thoma Cressey Friends Fund VI, L.P. EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS WC - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 0 SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 2,098,596 shares EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 0 WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 2,098,596 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,098,596 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.1% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- (Page 13 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS TC Partners VI, L.P. EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO/Not Applicable - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 0 SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 2,098,596 shares EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 0 WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 2,098,596 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,098,596 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.1% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- (Page 14 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Thoma Cressey Equity Partners, Inc. EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS OO/Not Applicable - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 0 SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 2,098,596 shares EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 0 WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 2,098,596 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,098,596 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.1% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON CO - -------------------------------------------------------------------------------- (Page 15 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Bryan C. Cressey EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 213,274 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 2,098,596 shares EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 213,274 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 2,098,596 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,311,870 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 2.3% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 16 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Rocco A. Ortenzio EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 12,151,025 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 426,823 shares EACH ---------------------------------------------------- REPORTING 9. DISPOSITIVE POWER PERSON 12,151,025 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 426,823 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 12,577,848 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 11.5% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 17 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Robert A. Ortenzio EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 4,100,003 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 459,284 shares EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 4,100,003 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 459,284 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 4,559,287 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 4.4% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 18 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Patricia A. Rice EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 158,124 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 200,000 shares EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 158,124 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 200,000 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 358,124 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 19 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Martin F. Jackson EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 390,986 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 4,000 shares EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 390,986 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 4,000 shares - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 394,986 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 20 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS S. Frank Fritsch EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 146,808 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 146,808 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 146,808 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 21 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Michael E. Tarvin EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 62,785 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 62,785 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 62,785 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 22 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS James J. Talalai EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 75,844 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 75,844 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 75,844 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN (Page 23 of 33 Pages) - -------------------------------------------------------------------------------- CUSIP No. 816196 10 9 - -------------------------------------------------------------------------------- 1. NAME OF REPORTING PERSONS S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS Scott A. Romberger EIN No.: - -------------------------------------------------------------------------------- 2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)|X| (b)|_| - -------------------------------------------------------------------------------- 3. SEC USE ONLY - -------------------------------------------------------------------------------- 4. SOURCE OF FUNDS PF - -------------------------------------------------------------------------------- 5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS |_| IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) - -------------------------------------------------------------------------------- 6. CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- 7. SOLE VOTING POWER NUMBER OF 130,228 shares SHARES ---------------------------------------------------- BENEFICIALLY 8. SHARED VOTING POWER OWNED BY 0 EACH ---------------------------------------------------- REPORTING 9. SOLE DISPOSITIVE POWER PERSON 130,228 shares WITH ---------------------------------------------------- 10. SHARED DISPOSITIVE POWER 0 - -------------------------------------------------------------------------------- 11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 130,228 shares - -------------------------------------------------------------------------------- 12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES - -------------------------------------------------------------------------------- 13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) Less than 1.0% - -------------------------------------------------------------------------------- 14. TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- (Page 24 of 33 Pages) AMENDMENT NO. 1 TO SCHEDULE 13D Reference is hereby made to the statement on Schedule 13D originally filed with the Securities and Exchange Commission (the "Commission") on October 20, 2004 (as amended from time to time, the "Schedule 13D"). Items 1, 2, 3, 4, 5, 6 and 7 of the Schedule 13D are hereby amended and restated as follows: Item 1. SECURITY AND ISSUER. The class of equity securities to which the Schedule 13D relates is the Common Stock, par value $.01 per share ("Common Stock"), of Select Medical Corporation, a Delaware corporation (the "Issuer"). The address of the principal executive offices of the Issuer is 4716 Old Gettysburg Road, Mechanicsburg, Pennsylvania 17055. Item 2. IDENTITY AND BACKGROUND. (a) Name ---- This Schedule 13D is being filed on behalf of each of the following persons pursuant to Rule 13d-1(k) promulgated by the Commission pursuant to Section 13 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"): EGL Holding Company, a Delaware corporation ("Holdings"), Welsh, Carson, Anderson & Stowe IX, L.P., a Delaware limited partnership ("WCAS IX"), WCAS IX Associates, L.L.C., a Delaware limited liability company ("WCAS IX Associates"), Patrick J. Welsh, Russell L. Carson, Bruce K. Anderson, Thomas E. McInerney, Robert A. Minicucci, Anthony J. de Nicola, Thoma Cressey Fund VI, L.P., a Delaware limited partnership ("TCEP VI"), Thoma Cressey Friends Fund VI, L.P., a Delaware limited partnership ("TCEP Friends"), TC Partners VI, L.P., a Delaware limited partnership ("TC GP"), Thoma Cressey Equity Partners, Inc., a Delaware corporation ("TCEP"), Bryan C. Cressey, Rocco A. Ortenzio, Robert A. Ortenzio, Patricia A. Rice, Martin F. Jackson, S. Frank Fritsch, James J. Talalai, Michael E. Tarvin and Scott A. Romberger. WCAS IX is the sole stockholder of Holdings. Sean M. Traynor and Eric J. Lee are officers and the directors of Holdings. Russell L. Carson is also an officer of Holdings. WCAS IX Associates is the sole general partner of WCAS IX. Each of the following individuals are managing members of WCAS IX Associates: Patrick J. Welsh, Russell L. Carson, Bruce K. Anderson, Thomas E. McInerney, Robert A. Minicucci, Anthony J. de Nicola, Paul B. Queally, D. Scott Mackesy, Sanjay Swani, John D. Clark, James R. Matthews, Sean D. Traynor, John Almeida, and Jonathan M. Rather (collectively, the "WCAS Persons" and together with Eric J. Lee, the "WCAS Individuals"). The WCAS Individuals are each employees of an affiliate of WCAS IX Associates. Russell L. Carson is a director of the Issuer. TCEP is the general partner of TC GP and TC GP is the general partner of each of TCEP VI and TCEP Friends. Bryan C. Cressey (collectively with TCEP VI, TCEP Friends, TC GP and TCEP, the "TCEP Investors") is a principal at TCEP and a director of the Issuer. Each of Rocco A. Ortenzio, Robert A. Ortenzio Patricia A. Rice, Martin F. Jackson, S. Frank Fritsch, James J. Talalai, Michael E. Tarvin and Scott A. Romberger (collectively, the "SEM Persons") are directors and/or executive officers of the Issuer. The reporting persons are making this single, joint filing because they may be deemed to constitute a "group" within the meaning of Section 13(d)(3) of the Exchange Act. Each of the aforementioned reporting persons has entered into an Amended and Restated Joint Filing Agreement, a copy of which is filed with this Schedule 13D as Exhibit A, pursuant to which such persons have agreed to file this Schedule 13D jointly in accordance with the provisions of Rule 13d-1(k)(1) under the Exchange Act. (Page 25 of 33 Pages) Information in this Schedule 13D with respect to each of the reporting persons is given solely by such reporting person, and no reporting person assumes responsibility for the accuracy or completeness of information provided by another reporting person. (b) Principal Address ----------------- The principal address of each of Holdings, WCAS IX, WCAS IX Associates and each WCAS Individual is c/o Welsh, Carson, Anderson & Stowe, 320 Park Avenue, Suite 2500, New York, New York 10022. The principal address of each TCEP Investor is 233 Wacker Drive, 92nd Floor, Chicago, Illinois 60606. The principal address of each SEM Person is c/o Select Medical Corporation, 4716 Old Gettysburg Road, Mechanicsburg, Pennsylvania 17055. (c) Principal Business ------------------ The principal business of Holdings will be the acquisition of the outstanding shares of the Issuer (as described in Item 4 below). The principal business of WCAS IX is that of an investment limited partnership. The principal business of WCAS IX Associates is that of general partner of WCAS IX. The principal business of each WCAS Individual is that of an employee of an affiliate of WCAS IX Associates and, other than Eric J. Lee, a managing member of WCAS IX Associates. The principal business of TCEP VI and TCEP Friends is that of an investment limited partnership. The principal business of TC GP is that of general partner of TCEP VI and TCEP Friends. The principal business of TCEP is that of general partner of TC GP and other similar partnerships. The principal business of Bryan C. Cressey is that of a principal of TCEP. The principal business of each SEM Person is that of a director and/or executive officer of the Issuer. (d and e) No Convictions or Proceedings. ----------------------------- During the last five years, none of the reporting persons or other individuals for which information has been provided in this Item 2, as applicable: (i) has been convicted in any criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction resulting in his being subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. (f) Citizenship ----------- Each WCAS Individual (other than D. Scott Mackesy), Bryan C. Cressey and each SEM Person is a citizen of the United States. D. Scott Mackesy is a citizen of Canada. Item 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. Holdings, WCAS IX and WCAS IX Associates may be deemed to have acquired beneficial ownership of 7,952,227 shares of Common Stock pursuant to (a) the Agreement, dated October 17, 2004 (the "Initial Rollover Agreement"), between Holdings, the TCEP Investors and certain of the SEM Persons, (b) the Agreement, dated December 20, 2004 (the "Subsequent Rollover Agreement"), between Holdings and the remaining SEM Persons and (c) an understanding among Holdings and the WCAS Persons who are reporting persons. However, such reporting persons expressly disclaim beneficial ownership of the shares of Common Stock covered by the Initial Rollover Agreement, the Subsequent Rollover Agreement or such understanding. Subject to the terms of the Initial Rollover Agreement and Subsequent Rollover Agreement, each TCEP (Page 26 of 33 Pages) Investor and each SEM Person has agreed to (i) contribute certain of their shares of Common Stock to Holdings prior to the consummation of the Merger (as defined in Item 4 below) and in return receive equity interests in Holdings, (ii) enter into certain agreements with Holdings, WCAS IX and other equity investors selected by Holdings with respect to such contribution and (iii) not to transfer any such shares of Common Stock prior to consummation of the Merger without the consent of Holdings. Any contributed shares will be cancelled in the Merger. In addition, pursuant to such agreements, each SEM Person will execute various restricted stock award and employment agreements as well as receive other cash incentives in connection with their continuing employment by the surviving corporation following consummation of the Merger. The foregoing descriptions of the Initial Rollover Agreement and Subsequent Rollover Agreement are qualified in their entirety by reference to such agreements, copies of which are attached hereto as Exhibits B and I, respectively, and are incorporated herein by reference. To the extent any WCAS Person who is a reporting person directly beneficially owns any shares of Common Stock (as set forth in Item 5 below), such shares were purchased by such reporting person using such reporting person's personal funds or received pursuant to distributions made to such reporting person by investment partnerships affiliated with WCAS IX. To the extent any TCEP Investor directly beneficially owns any shares of Common Stock (as set forth in Item 5 below), such shares were purchased by each such reporting person using such reporting person's personal funds. To the extent any SEM Person directly beneficially owns any shares of Common Stock (as set forth in Item 5 below), such shares were purchased, directly or indirectly, by such reporting person using such reporting person's personal funds or pursuant to the cashless exercise of options. Item 4. PURPOSE OF TRANSACTION. (a through j) On October 17, 2004, Holdings, EGL Acquisition Corp., a Delaware corporation ("Acquisition"), and the Issuer entered into an Agreement and Plan of Merger, a copy of which is attached hereto as Exhibit C (the "Merger Agreement"), pursuant to which Acquisition, a wholly owned subsidiary of Holdings, will be merged with and into the Issuer, with the Issuer continuing as the surviving corporation (the "Merger"). Following the consummation of the Merger, the Issuer will be a wholly owned subsidiary of Holdings. Under the terms of the Merger Agreement, each existing share of Common Stock, other than shares held by WCAS IX or its affiliates, treasury shares and dissenting shares, will be converted into the right to receive $18.00 in cash (the "Merger Consideration"). In addition, all outstanding options for Common Stock will be converted into the right to receive the Merger Consideration less the exercise price of such options. The Merger remains subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, including obtaining approval of the existing shareholders of the Issuer. Pursuant to the Merger Agreement, the board of directors of Acquisition at the effective time of the Merger will become the board of directors of the Issuer. In addition, the certificate of incorporation of the Issuer will be amended and restated at the effective time of the Merger to conform to an exhibit attached to the Merger Agreement (the bylaws of the Issuer will not change). If the Merger is consummated, the Common Stock will be delisted from the New York Stock Exchange and will be deregistered under Section 12(g)(4) of the Exchange Act. The foregoing description of the Merger Agreement is qualified in its entirety by reference to such agreement, a copy of which is attached hereto as Exhibit C, and is incorporated herein by reference. In addition to the transactions contemplated by the Initial Rollover Agreement and Subsequent Rollover Agreement, the Merger is expected to be financed by equity investments in Holdings to be made by certain of the reporting persons and related investors, certain loan arrangements to be entered into by Holdings and the Issuer with JP Morgan Chase Bank, Wachovia Bank, National Association and Merrill Lynch Capital Corporation (collectively, the "Lenders"), and a loan to be made to Holdings by WCAS Capital Partners IV, L.P., a Delaware limited partnership ("WCAS CP IV") and an affiliate of WCAS IX. The specific investments and loans are discussed below. Pursuant to an Equity Commitment Letter, dated as of October 17, 2004 (the "WCAS Equity Commitment (Page 27 of 33 Pages) Letter"), by and between Holdings and WCAS IX, a copy of which is attached hereto as Exhibit D, WCAS IX and certain related investors, including the WCAS Persons, will provide up to $567.2 million in cash to Holdings in return for equity interests in Holdings. The cash proceeds of such investment will be contributed by Holdings to Acquisition to finance a portion of the consideration for the Merger. Also, Holdings has an understanding with the WCAS Persons who are reporting persons that such WCAS Persons will contribute certain of their shares of Common Stock to Holdings prior to the consummation of the Merger and in return receive equity interests in Holdings. Any contributed shares will be cancelled in the Merger. In addition, pursuant to the WCAS Equity Commitment Letter, a designee of WCAS IX, as agent for various entities, will receive a financing fee equal to $24.6 million and WCAS IX and its affiliates will be reimbursed for all of their out-of-pocket fees and expenses. Pursuant to an Equity Commitment Letter, dated as of October 17, 2004 (the "TCEP Equity Commitment Letter"), by and between Holdings and Thoma Cressey Fund VII, L.P., a Delaware limited partnership ("TCEP VII"), a copy of which is attached hereto as Exhibit E, TCEP VII and certain related investors, each of which are affiliates of one or more of the TCEP Investors, will provide up to $50.0 million in cash to Holdings in return for equity interests in Holdings. The cash proceeds of such investment will be contributed by Holdings to Acquisition to finance a portion of the consideration for the Merger. In addition, WCAS IX and TCEP VII have an understanding that TCEP VII, or its designee will be entitled to receive a portion of the financing fee payable pursuant to the WCAS Equity Commitment Letter and TCEP VII and its affiliates will be reimbursed for all of their out-of-pocket fees and expenses. Pursuant to a Senior Secured Credit Facilities and Senior Subordinated Bridge Facility Commitment Letter, dated October 17, 2004, as amended and restated as of December 20, 2004 (the "Debt Commitment Letter"), by and among Holdings and the Lenders, a copy of which is attached hereto as Exhibit F, the Lenders have agreed to provide (i) a $580.0 million senior secured term loan facility and (ii) a $300.0 million revolving credit facility (collectively, the "Bank Facility"). The Debt Commitment Letter contemplates that the Issuer and/or Holdings will issue an aggregate $660.0 million unsecured senior subordinated notes (the "Notes") pursuant to a Rule 144A offering. In the event that the Notes are not issued at the time the Merger is consummated, the Lenders have agreed to provide a bridge loan facility in the amount of up $660.0 million under a senior unsecured credit facility (the "Bridge Facility"). The Bank Facility and the Bridge Facility are expected to contain customary terms and conditions, including, without limitation, with respect to fees, indemnification and events of default. A portion of the proceeds of these loan arrangements will be used to finance a portion of the consideration for the Merger. Pursuant to a Commitment Letter, dated as of October 17, 2004 (the "CP IV Commitment Letter"), by and between Holdings and WCAS CP IV, a copy of which is attached hereto as Exhibit G, WCAS CP IV will provide up to $150.0 million in cash to Holdings in return for a senior subordinated note. The cash proceeds of such loan will be contributed by Holdings to Acquisition to finance a portion of the consideration for the Merger. Pursuant to the CP IV Commitment Letter, WCAS CP IV and its affiliates will be reimbursed for all of their out-of-pocket fees and expenses. In addition, in connection with the Merger, WCAS IX, Holdings and the Issuer entered into a Contingency Letter Agreement, dated October 17, 2004 (the "Contingency Letter"), a copy of which is attached hereto as Exhibit H, pursuant to which WCAS IX agreed that, in the event the Issuer terminates the Merger Agreement and such termination arises from a knowing and willful breach of the Merger Agreement by Acquisition and/or Holdings, it will make an equity contribution to Holdings of up to $10.0 million to satisfy any liabilities of Holdings or Acquisition resulting from such knowing or willful. The foregoing descriptions of the WCAS Equity Commitment Letter, the TCEP Equity Commitment Letter, the Debt Commitment Letter, the CP IV Commitment Letter and the Contingency Letter are qualified in their entirety by reference to such agreements, copies of which are attached as Exhibits D, E, F, G and H, respectively, and are incorporated herein by reference. Item 5. INTEREST IN SECURITIES OF THE ISSUER. The following information is based on a total of 101,951,443 shares of Common Stock outstanding as of December 1, 2004. (Page 28 of 33 Pages) (a through b) As of the date of filing, no reporting person may be deemed to beneficially own any shares of Common Stock except as may be due to being part of a "group" within the meaning of Section 13(d) of the Exchange Act or as may be set forth below. Each reporting person has sole voting power with respect to and sole power to dispose of the shares set forth below that are directly beneficially owned by such reporting person. Each reporting person expressly disclaims beneficial ownership of any shares which are held by related investors, except to the extent of such reporting person's pecuniary interest in such related investor. Holdings, WCAS IX, WCAS IX Associates and the WCAS Individuals -------------------------------------------------------------- Holdings, WCAS IX and WCAS IX Associates may be deemed to have acquired beneficial ownership of 7,952,227 shares of Common Stock pursuant to (a) the Initial Rollover Agreement, (b) the Subsequent Rollover Agreement and (c) an understanding among Holdings and the WCAS Persons who are reporting persons. However, such reporting persons expressly disclaim beneficial ownership of the shares of Common Stock covered by the Initial Rollover Agreement, the Subsequent Rollover Agreement or such understanding. Holdings, Acquisition, WCAS IX, WCAS IX Associates and the WCAS Individuals do not directly own any shares of Common Stock other than as set forth below. (i) Patrick J. Welsh directly owns 125,000 shares of Common Stock, or less than 1.0% of the Common Stock outstanding. (ii) Russell L. Carson directly owns 722,960 shares of Common Stock, or less than 1.0% of the Common Stock outstanding. (iii) Bruce K. Anderson directly owns 618,910 shares of Common Stock, or less than 1.0% of the Common Stock outstanding. (iv) Thomas E. McInerney directly owns 450,984 shares of Common Stock, or less than 1.0% of the Common Stock outstanding. (v) Robert A. Minicucci directly owns 88,626 shares of Common Stock, or less than 1.0% of the Common Stock outstanding. (vi) Anthony J. de Nicola directly owns 19,483 shares of Common Stock (including 12,239 shares held by a foundation he controls), or less than 1.0% of the Common Stock outstanding. TCEP Investors -------------- As general partner of TCEP VI and TCEP Friends, TC GP may be deemed to beneficially own the shares of the Common Stock beneficially owned by such entities, and as general partner of TC GP, TCEP may also be deemed to beneficially own such shares. In addition, Bryan C. Cressey is a principal of TCEP and may be deemed to beneficially own the shares of Common Stock beneficially owned by TCEP VI, TCEP Friends and TCEP. The TCEP Investors do not directly own any shares of Common Stock other than as set forth below. (i) TCEP VI directly owns 2,077,818 shares of Common Stock, or approximately 2.1% of the Common Stock outstanding. (ii) TCEP Friends directly owns 20,778 shares of Common Stock, or less than 1.0% of the Common Stock outstanding. (iii) Bryan C. Cressey directly owns 213,274 shares of Common Stock, or less than 1.0% of the Common Stock outstanding. (Page 29 of 33 Pages) SEM Persons ----------- (i) Rocco A. Ortenzio directly owns 12,151,025 shares of Common Stock (including 7,778,000 shares issuable upon exercise of presently-exercisable stock options or options exercisable within the next 60 days), and indirectly beneficially owns, through relationships he has with various other investors, an additional 426,823 shares of Common Stock of which he shares voting power and the power to dispose with such other investors, for an aggregate 12,577,848 shares of Common Stock, or approximately 11.5% of the Common Stock outstanding. (ii) Robert A. Ortenzio directly owns 4,100,003 shares of Common Stock (including 2,400,003 shares issuable upon exercise of presently-exercisable stock options or options exercisable within the next 60 days), and indirectly beneficially owns, through relationships he has with various other investors, an additional 459,284 shares of Common Stock of which he shares voting power and the power to dispose with such other investors, for an aggregate 4,559,287 shares of Common Stock, or approximately 4.4% of the Common Stock outstanding. (iii) Patricia A. Rice directly owns 158,124 shares of Common Stock (including 157,124 shares issuable upon exercise of presently-exercisable stock options or options exercisable within the next 60 days), and indirectly beneficially owns an additional 200,000 shares of Common Stock through a living trust, for an aggregate 358,124 shares of Common Stock, or less than 1.0% of the Common Stock outstanding. (iv) Martin F. Jackson directly owns 390,986 shares of Common Stock (including 293,986 shares issuable upon exercise of presently-exercisable stock options or options exercisable within the next 60 days), and indirectly beneficially owns an additional 4,000 shares of Common Stock held by his children, for an aggregate 394,986 shares of Common Stock, or less than 1.0% of the Common Stock outstanding. (v) S. Frank Fritsch directly owns 146,808 shares of Common Stock (including 59,262 shares issuable upon exercise of presently-exercisable stock options or options exercisable within the next 60 days), or less than 1.0% of the Common Stock outstanding. (vi) Michael E. Tarvin directly owns 62,785 shares of Common Stock (including 59,261 shares issuable upon exercise of presently-exercisable stock options or options exercisable within the next 60 days), or less than 1.0% of the Common Stock outstanding. (vii) James J. Talalai directly owns 75,844 shares of Common Stock (including 61,520 shares issuable upon exercise of presently-exercisable stock options or options exercisable within the next 60 days), or less than 1.0% of the Common Stock outstanding. (viii) Scott A. Romberger directly owns 130,228 shares of Common Stock (including 30,426 shares issuable upon exercise of presently-exercisable stock options or options exercisable within the next 60 days), or less than 1.0% of the Common Stock outstanding. (c) Except as described in Item 3 above, none of the reporting persons has effected any transactions in the Common Stock in the 60 days prior to the date of this statement. (d) Except as described in this Schedule 13D, no person has the power to direct the receipt of dividends on or the proceeds of sales of, the shares of Common Stock owned by the reporting persons. (e) Not applicable. (Page 30 of 33 Pages) Item 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. Except as described in this Schedule 13D or the Exhibits hereto, or with respect to the SEM Persons, in their filings pursuant to Section 16 filed prior to the date hereof, none of the reporting persons or other individuals for which information has been provided in Item 2 presently have any contracts, arrangements, understandings or relationships with respect to the securities of the Issuer. Item 7. MATERIAL TO BE FILED AS EXHIBITS. A. Amended and Restated Joint Filing Agreement dated December 20, 2004. B. Initial Rollover Agreement (previously filed with the original Schedule 13D on October 20, 2004). C. Merger Agreement (previously filed with the original Schedule 13D on October 20, 2004). D. WCAS Equity Commitment Letter (previously filed with the original Schedule 13D on October 20, 2004). E. TCEP Equity Commitment Letter (previously filed with the original Schedule 13D on October 20, 2004). F. Debt Commitment Letter. G. CP IV Commitment Letter (previously filed with the original Schedule 13D on October 20, 2004). H. Contingency Letter (previously filed with the original Schedule 13D on October 20, 2004). I. Subsequent Rollover Agreement. (Page 31 of 33 Pages) SIGNATURES After reasonable inquiry and to the best of my knowledge and belief, the undersigned certifies that the information set forth in this Statement is true, complete and correct. Dated: December 21, 2004 EGL HOLDING COMPANY By: /s/ Sean M. Traynor -------------------------------------------------- President WELSH, CARSON, ANDERSON & STOWE IX, L.P. By: WCAS IX Associates, LLC, General Partner By: /s/ Jonathan M. Rather -------------------------------------------------- Managing Member WCAS IX ASSOCIATES, LLC By: /s/ Jonathan M. Rather -------------------------------------------------- Managing Member /s/ Jonathan M. Rather -------------------------------------------------- Attorney-in-Fact/Patrick J. Welsh /s/ Jonathan M. Rather -------------------------------------------------- Attorney-in-Fact/Russell L. Carson /s/ Jonathan M. Rather -------------------------------------------------- Attorney-in-Fact/Bruce K. Anderson /s/ Jonathan M. Rather -------------------------------------------------- Attorney-in-Fact/Thomas E. McInerney /s/ Jonathan M. Rather -------------------------------------------------- Attorney-in-Fact/Robert A. Minicucci /s/ Jonathan M. Rather -------------------------------------------------- Attorney-in-Fact/Anthony J. deNicola (Page 32 of 33 Pages) THOMA CRESSEY FUND VI, L.P. By: TC Partners VI, L.P., General Partner By: Thoma Cressey Equity Partners, Inc., General Partner By: /s/ Bryan C. Cressey -------------------------------------------------- Vice President THOMA CRESSEY FRIENDS FUND VI, L.P. By: TC Partners VI, L.P., General Partner By: Thoma Cressey Equity Partners, Inc., General Partner By: /s/ Bryan C. Cressey -------------------------------------------------- Vice President TC PARTNERS VI, L.P. By: Thoma Cressey Equity Partners, Inc., General Partner By: /s/ Bryan C. Cressey -------------------------------------------------- Vice President THOMA CRESSEY EQUITY PARTNERS, INC. By: /s/ Bryan C. Cressey -------------------------------------------------- Vice President /s/ Bryan C. Cressey -------------------------------------------------- Bryan C. Cressey (Page 33 of 33 Pages) /s/ Rocco A. Ortenzio -------------------------------------------------- Rocco A. Ortenzio /s/ Robert A. Ortenzio -------------------------------------------------- Robert A. Ortenzio /s/ Patricia A. Rice -------------------------------------------------- Patricia A. Rice /s/ Martin F. Jackson -------------------------------------------------- Martin F. Jackson /s/ S. Frank Fritsch -------------------------------------------------- S. Frank Fritsch /s/ Michael E. Tarvin -------------------------------------------------- Michael E. Tarvin /s/ James J. Talalai -------------------------------------------------- James J. Talalai /s/ Scott A. Romberger -------------------------------------------------- Scott A. Romberger EX-99 2 exha_12202004select.txt EXHIBIT A - AGMT. -- THE JOINT FILING OF SCH. 13D Exhibit A --------- AMENDED AND RESTATED AGREEMENT REGARDING THE JOINT FILING OF SCHEDULE 13D ------------------------------ The undersigned hereby agree as follows: (i) Each of them is individually eligible to use the Schedule 13D to which this Exhibit is attached, and such Schedule 13D is filed on behalf of each of them; and (ii) Each of them is responsible for the timely filing of such Schedule 13D and any amendments thereto, and for the completeness and accuracy of the information concerning such person contained therein; but none of them is responsible for the completeness or accuracy of the information concerning the other persons making the filing, unless such person knows or has reason to believe that such information is inaccurate. Dated: December 21, 2004 EGL HOLDING COMPANY By: /s/ Sean M. Traynor -------------------------------------------------- President WELSH, CARSON, ANDERSON & STOWE IX, L.P. By: WCAS IX Associates, LLC, General Partner By: /s/ Jonathan M. Rather -------------------------------------------------- Managing Member WCAS IX ASSOCIATES, LLC By: /s/ Jonathan M. Rather -------------------------------------------------- Managing Member /s/ Jonathan M. Rather --------------------------------------------------- Attorney-in-Fact/Patrick J. Welsh /s/ Jonathan M. Rather --------------------------------------------------- Attorney-in-Fact/Russell L. Carson /s/ Jonathan M. Rather --------------------------------------------------- Attorney-in-Fact/Bruce K. Anderson /s/ Jonathan M. Rather --------------------------------------------------- Attorney-in-Fact/Thomas E. McInerney /s/ Jonathan M. Rather --------------------------------------------------- Attorney-in-Fact/Robert A. Minicucci /s/ Jonathan M. Rather --------------------------------------------------- Attorney-in-Fact/Anthony J. deNicola THOMA CRESSEY FUND VI, L.P. By: TC Partners VI, L.P., General Partner By: Thoma Cressey Equity Partners, Inc., General Partner By: /s/ Bryan C. Cressey -------------------------------------------------- Vice President THOMA CRESSEY FRIENDS FUND VI, L.P. By: TC Partners VI, L.P., General Partner By: Thoma Cressey Equity Partners, Inc., General Partner By: /s/ Bryan C. Cressey -------------------------------------------------- Vice President TC PARTNERS VI, L.P. By: Thoma Cressey Equity Partners, Inc., General Partner By: /s/ Bryan C. Cressey -------------------------------------------------- Vice President THOMA CRESSEY EQUITY PARTNERS, INC. By: /s/ Bryan C. Cressey -------------------------------------------------- Vice President /s/ Bryan C. Cressey --------------------------------------------------- Bryan C. Cressey /s/ Rocco A. Ortenzio --------------------------------------------------- Rocco A. Ortenzio /s/ Robert A. Ortenzio --------------------------------------------------- Robert A. Ortenzio /s/ Patricia A. Rice --------------------------------------------------- Patricia A. Rice /s/ Martin F. Jackson --------------------------------------------------- Martin F. Jackson /s/ S. Frank Fritsch --------------------------------------------------- S. Frank Fritsch /s/ Michael E. Tarvin --------------------------------------------------- Michael E. Tarvin /s/ James J. Talalai --------------------------------------------------- James J. Talalai /s/ Scott A. Romberger --------------------------------------------------- Scott A. Romberger EX-99 3 exhf_12202004select.txt EXHIBIT F - AMENDED & RESTATED COMMITMENT LETTER EXHIBIT F --------- JPMorgan Chase Bank Wachovia Bank, National Association Merrill Lynch, Pierce, Fenner & Smith J.P. Morgan Securities Inc. Wachovia Capital Markets, LLC Incorporated 270 Park Avenue 1 Wachovia Center, DC 6 Merrill Lynch Capital Corporation New York, NY 10017 301 South College Street 4 World Financial Center Charlotte, NC 28288 New York, NY 10080
December 20, 2004 EGL Holding Company c/o Welsh, Carson, Anderson & Stowe 320 Park Avenue, Suite 2500 New York, NY 10022 Attention of Sean Traynor Project Eagle -------------- $880,000,000 Senior Secured Credit Facilities --------------------------------------------- $660,000,000 Senior Subordinated Bridge Facility ------------------------------------------------ Amended and Restated Commitment Letter -------------------------------------- Ladies and Gentlemen: This letter agreement amends and restates and supersedes in its entirety the Project Eagle -- $780,000,000 Senior Secured Credit Facilities/$660,000,000 Senior Subordinated Bridge Facility Commitment Letter (together with the Senior Facilities Term Sheet attached thereto as Exhibit A and the Bridge Facility Term Sheet attached thereto as Exhibit B, the "Original Commitment Letter") dated October 17, 2004 between EGL Holding Company and JPMCB, JPMorgan, Wachovia, WCM, MLCC and MLPF&S (each as defined below). You have advised JPMorgan Chase Bank ("JPMCB"), J.P. Morgan Securities Inc. ("JPMorgan"), Wachovia Bank, National Association ("Wachovia"), Wachovia Capital Markets, LLC ("WCM"), Merrill Lynch Capital Corporation ("MLCC" and, together with JPMorgan and Wachovia, the "Agents") and Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S") that you intend to consummate the Transactions (such term and each other capitalized term used but not defined herein having the meanings assigned to them in the Term Sheets (as defined below)). In connection with the foregoing, (a) JPMCB is pleased to advise you of its commitment to provide (i) 33.34% of the aggregate principal amount of the Senior Facilities, upon the terms and subject to the conditions set forth or referred to in this Commitment Letter and in the Summary of Principal Terms and Conditions attached hereto as Exhibit A (the "Senior Facilities Term Sheet"), and (ii) 33.33% of the aggregate principal amount of the Bridge Facility, upon the terms and subject to the conditions set forth or referred to in this Commitment Letter and in the Summary of Principal Terms and Conditions attached hereto as Exhibit B (the "Bridge Facility Term Sheet" and, together with the Senior Facilities Term Sheet, the "Term Sheets"); (b) Wachovia is pleased to advise you of its commitment to provide (i) 33.33% of the aggregate principal amount of the Senior Facilities, upon the terms and subject to the conditions set forth or referred to in this Commitment Letter and in the Senior Facilities Term Sheet, and (ii) 33.33% of the aggregate principal amount of the Bridge Facility, upon the terms and subject to the conditions set forth or referred to in this Commitment Letter and in the Bridge Facility Term Sheet; and (c) MLCC is pleased to advise you of its commitment to provide (i) 33.33% of the aggregate principal amount of the Senior Facilities, upon the terms and subject to the conditions set forth or referred to in this Commitment Letter and in the Senior Facilities Term Sheet, and (ii) 33.34% of the aggregate principal amount of the Bridge Facility, upon the terms and subject to the conditions set forth or referred to in this Commitment Letter and in the Bridge Facility Term Sheet. The commitments described in this paragraph are collectively referred to herein as the "Commitments". It is understood and agreed that (a) JPMCB will act as the sole and exclusive administrative agent and collateral agent for the Senior Facilities, (b) Wachovia will act as the sole and exclusive syndication agent for the Senior Facilities, (c) MLCC will act as the sole and exclusive documentation agent for the Senior Facilities and as sole and exclusive administrative agent for the Bridge Facility, and (d) each will, in such capacities, perform the duties customarily associated with such roles. It is also understood and agreed that (a) JPMorgan, WCM and MLPF&S will act as joint arrangers for the Senior Facilities (in such capacities, the "Senior Facilities Arrangers"), (b) JPMorgan and WCM will act as joint lead arrangers and joint bookrunners for the Senior Facilities (in such capacities, the "Lead Arrangers") and (c) MLPF&S, JPMorgan and WCM will act as joint arrangers and joint bookrunners for the Bridge Facility (in such capacities, the "Bridge Facility Arrangers" and, together with the Senior Facilities Arrangers and the Lead Arrangers, the "Arrangers"), in each case, upon the terms set forth or referred to in this Commitment Letter and in the Term Sheets. It is further understood and agreed that (a) no additional agents, co-agents, arrangers, co-arrangers or bookrunners will be appointed and no other titles awarded in connection with the Facilities without the approval of the Arrangers and (b) no compensation (other than as expressly contemplated by the Term Sheets or the Fee Letters referred to below) will be paid in connection with the Facilities unless you and we so agree. Each Arranger reserves the right, prior to or after the execution of definitive documentation for the Facilities, to syndicate all or a portion of its Commitments to one or more financial institutions that will become parties to such definitive documentation pursuant to (a) syndications of the Senior Facilities to be managed by JPMorgan and (b) a syndication of the Bridge Facility to be managed by MLPF&S (the financial institutions becoming parties to such definitive documentation being collectively referred to as the "Lenders"). You understand that each of the Facilities will be separately syndicated. The Arrangers may decide to commence syndication efforts promptly, and you agree actively to assist the Arrangers in completing a timely and orderly syndication satisfactory to the Arrangers. Such assistance shall include, but not be limited to (a) your using commercially reasonable efforts to ensure that the syndication efforts benefit from your existing lending and investment banking relationships and the existing lending and investment banking relationships of the Fund, the Borrower and Eagle, (b) direct contact during the syndications between your senior management, representatives and advisors and those of the Fund, the Borrower and Eagle, on the one hand, and the proposed Lenders, on the other hand, (c) your assistance (including the use of commercially reasonable efforts to cause the Fund, the Borrower, Eagle and your and their respective affiliates and advisors to assist) in the preparation of Confidential Information Memoranda for the Facilities and other marketing materials to be used in connection with the syndications and (d) the hosting, with the Arrangers, of one or more meetings of prospective Lenders. -2- It is understood and agreed that (a) JPMorgan will, after consultation with you and the other Arrangers, manage all aspects of the syndications of the Senior Facilities, and (b) MLPF&S will, after consultation with you and the other Arrangers, manage all aspects of the syndication of the Bridge Facility, in each case including selection of Lenders, determination of when such Arranger will approach potential Lenders and the time of acceptance of the Lenders' commitments, any naming rights and the final allocations of the commitments among the Lenders. It is also understood and agreed that the amount and distribution of fees among the Lenders (a) under the Senior Facilities will be at JPMorgan's discretion, after consultation with you and the other Arrangers, and (b) under the Bridge Facility will be at MLPF&S's discretion, after consultation with you and the other Arrangers. To assist the Arrangers in their syndication efforts, you agree promptly to prepare and provide to each Agent and each Arranger (and to use commercially reasonable efforts to cause the Fund, the Borrower and Eagle to provide) all information with respect to you, the Borrower, Eagle and their respective subsidiaries, the Transactions and the other transactions contemplated hereby, including all financial information and projections (the "Projections"), as they may reasonably request in connection with the structuring, arrangement and syndication of the Facilities. At the request of the Arrangers, you agree to assist (and to use commercially reasonable efforts to cause the Borrower and Eagle to assist) in the preparation of a version of the information package and presentation consisting exclusively of information and documentation that is either publicly available or not material with respect to you, the Borrower, Eagle, your or their respective subsidiaries or affiliates and any of your or their respective securities for purposes of Federal and state securities laws. The Commitments and the Agents' and the Arrangers' agreements to perform the services described herein are subject to the condition that (a) all information other than the Projections (the "Information") that has been or will be prepared by or on behalf of you, the Fund, the Borrower, Eagle or any of your or their authorized representatives and made available to any Agent or any Arranger (taken as a whole and giving effect to all written updates thereto) is or will be, when furnished, complete and correct in all material respects and does not or will not, when furnished, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not materially misleading in light of the circumstances under which such statements are made and (b) the Projections that have been or will be prepared by or on behalf of you, the Fund, the Borrower, Eagle or any of your or their authorized representatives and made available to any Arranger or any Agent have been or will be prepared in good faith based upon assumptions that are reasonable at the time of preparation and at the time the related Projections are made available to any Agent or any Arranger. You agree that if at any time from and including the date hereof until the Closing Date the condition in the preceding sentence would not be satisfied if the Information and the Projections were being furnished at such time, then you will promptly supplement the Information and the Projections so that such condition would be satisfied under those conditions. In arranging the Facilities, including the syndications of the Facilities, the Agents and the Arrangers will be entitled to use and rely primarily on the Information and the Projections without responsibility for independent verification thereof. As consideration for the Commitments and the Agents' and the Arrangers' agreement to structure, arrange and syndicate the Facilities in connection therewith, you agree to pay (or to cause the Borrower to pay) to the Agents and the Arrangers the fees as set forth in the Term Sheets, in the Amended and Restated Fee Letter dated the date hereof and delivered here- -3- with with respect to the Facilities (the "Fee Letter") and in the Amended and Restated Administrative Agent Fee Letter dated the date hereof and delivered herewith between you and JPMCB (the "Administrative Agent Fee Letter" and, together with the Fee Letter, the "Fee Letters"). Each Commitment and each Agent's agreement and each Arranger's agreement to perform the services described herein are subject to (a) each Agent's and Arranger's not having discovered or otherwise become aware of information not previously disclosed to it that it reasonably believes to be materially inconsistent with the information provided to it by you prior to the date hereof, of the business, operations, assets, liabilities, financial condition or results of operations of Eagle and its subsidiaries, taken as a whole, (b) there not having occurred since December 31, 2003, any Company Material Adverse Effect (as defined below), (c) there not having occurred any significant change or condition in the loan syndication, financial or capital markets (including, without limitation, high-yield market) that, in the judgment of such Arranger, could reasonably be expected to materially impair the syndication of any of the Facilities or the issuance and sale of the Senior Subordinated Notes, (d) the satisfaction of such Arranger that, prior to and during the syndication of the Facilities, there shall be no competing issues of debt securities or commercial bank or other credit facilities of you, the Borrower, Eagle or your or their respective subsidiaries being offered, placed or arranged (other than the Senior Subordinated Notes), (e) the negotiation, execution and delivery of definitive documentation with respect to the Facilities reasonably satisfactory to each Agent and counsel for the Agents, (f) the Arrangers having been afforded a reasonable period to syndicate the Facilities and (g) the other conditions set forth or referred to herein and in the Term Sheets (including the annexes thereto). "Company Material Adverse Effect" means any event, change, condition, circumstance or state of facts or aggregation of events, changes, conditions, circumstances or state of facts, that has had or could reasonably be expected to have, individually or in the aggregate (i) a material adverse effect on the business, operations, assets, liabilities, financial condition or results of operations of Eagle and its subsidiaries, taken as a whole, whether or not covered by insurance, or (ii) a material adverse effect on the ability of the Borrower to perform its obligations under the Facilities, provided that Company Material Adverse Effect shall not be deemed to include any such material adverse effect arising as a result of conditions, events or circumstances (other than any changes or proposed changes in Laws (as defined below), including changes or proposed changes in payment or reimbursement by government payors, but excluding the final regulatory changes announced by the Center for Medicare and Medicaid Services on August 2, 2004 applicable to long term acute care hospitals operated as "hospitals within hospitals") affecting either (x) the United States economy generally or (y) the industry of the Company and its Subsidiaries generally, which in each case does not have a materially disproportionate effect on the Company and its Subsidiaries, taken as a whole. "Laws" means any statute, law, ordinance, rule, regulation, New York Stock Exchange or other stock exchange rule or listing requirement, permit or authorization. Those matters that are not covered by or made clear under the provisions hereof and of the Term Sheets are subject to the reasonable approval and agreement of the Agents, the Arrangers and you. By executing this Commitment Letter, you agree (a) to indemnify and hold harmless the Agents, the Arrangers and their respective officers, directors, employees, affiliates, agents, advisors, representatives and controlling persons from and against any and all losses, claims, damages, liabilities and expenses, joint or several, that may be incurred by or asserted or awarded against any such person (including, without limitation, in connection with any investi- -4- gation, litigation or proceeding or the preparation of a defense in connection therewith), in each case arising out of or in connection with this Commitment Letter, the Term Sheets, the Original Commitment Letter, the Fee Letters, the Original Fee Letter (as defined in the Fee Letter), the Original Administrative Agent Fee Letter (as defined in the Administrative Agent Fee Letter), the Transactions and the Facilities, regardless of whether any of such indemnified parties is a party thereto, and to reimburse each of such indemnified parties upon demand for any reasonable legal or other out-of-pocket expenses incurred in connection with investigating or defending any of the foregoing, provided that the foregoing indemnity will not, as to any indemnified party, apply to losses, claims, damages, liabilities or related expenses to the extent they are found in a final judgment of a court to have resulted from the willful misconduct or gross negligence of such indemnified party, and (b) in the circumstances set forth in the Fee Letter, to reimburse the Agents, the Arrangers and their respective affiliates, upon presentation of a summary statement in reasonable detail, for all reasonable out-of-pocket expenses (including, without limitation, reasonable out-of-pocket expenses of the Agents' and the Arrangers' due diligence investigations, consultants' fees, syndication expenses, travel expenses and reasonable fees, disbursements and other charges of counsel) incurred in connection with the Facilities and the preparation of any related documentation (including this Commitment Letter, the Term Sheets, the Original Commitment Letter, the Fee Letters, the Original Fee Letter, the Original Administrative Agent Fee Letter, the definitive documentation for the Facilities and any security arrangements in connection therewith). Notwithstanding any other provision of this Commitment Letter, no indemnified person shall be liable for any damages arising from the use by others of information or other materials obtained through electronic, telecommunications or other information transmission systems or for any special, indirect, consequential or punitive damages (including, without limitation, any loss of profits, business or anticipated savings) in connection with its activities related to this Commitment Letter, the Term Sheets, the Original Commitment Letter, the Fee Letter, the Original Fee Letter, the Original Administrative Agent Fee Letter, the Transactions and the Facilities. You acknowledge the Agents, the Arrangers and their respective affiliates may be providing debt financing, equity capital or other services (including financial advisory services) to other companies in respect of which you may have conflicting interests regarding the transactions described herein and otherwise. None of the Agents, the Arrangers or any of their respective affiliates will use confidential information obtained from you by virtue of the transactions contemplated by this Commitment Letter or its other relationships with you in connection with the performance by the Agents, the Arrangers or any of their respective affiliates of services for other companies, and none of the Agents, the Arrangers or any of their respective affiliates will furnish any such information to other companies. You also acknowledge that none of the Agents, the Arrangers or any of their respective affiliates has any obligation to use in connection with the transactions contemplated by this Commitment Letter, or to furnish to you, the Fund, the Borrower, Eagle or your or their respective subsidiaries, confidential information obtained by you or it or any of your or its respective affiliates from other companies. This Commitment Letter, the Commitments and the agreements of the Agents and the Arrangers shall not be assignable by you without the prior written consent of the other parties hereto, and any attempted assignment without such consent shall be void; provided, however, that this Commitment Letter, the Commitments hereunder and the Fee Letter may be assigned by you to the Borrower pursuant to a writing reasonably satisfactory to each of the Agents and the -5- Arrangers, so long as you remain liable for all your obligations hereunder and thereunder. This Commitment Letter may not be amended or any provision hereof waived or modified except by an instrument in writing signed by each of the Agents and the Arrangers and you. This Commitment Letter may be executed in any number of counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one agreement. Delivery of an executed counterpart of a signature page of this Commitment Letter by facsimile transmission shall be effective as delivery of a manually executed counterpart of this Commitment Letter. This Commitment Letter is solely for the benefit of the parties hereto and the indemnitees referred to herein and no other person shall acquire or have any rights under or by virtue of this Commitment Letter (other than, following any assignment to the Borrower in accordance with the first sentence of this paragraph, the Borrower). This Commitment Letter shall be governed by, and construed in accordance with, the laws of the State of New York. The Agents and the Arrangers may perform the duties and activities described hereunder through any of their respective affiliates and the provisions of the second preceding paragraph shall apply with equal force and effect to any of such affiliates so performing any such duties or activities. You, the Agents and the Arrangers irrevocably and unconditionally submit to the exclusive jurisdiction of any state or Federal court sitting in the City of New York over any suit, action or proceeding arising out of or relating to the Transactions, this Commitment Letter, the Term Sheets, the Fee Letters or the performance of services hereunder or thereunder. You, the Agents and the Arrangers hereby agree that service of any process, summons, notice or document by registered mail addressed to said party shall be effective service of process for any suit, action or proceeding brought in any such court. You, the Agents and the Arrangers irrevocably and unconditionally waive any objection to the laying of venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding has been brought in any inconvenient forum. You, the Agents and the Arrangers agree that a final judgment in any such suit, action or proceeding brought in any such court shall be conclusive and binding upon you and may be enforced in any other courts to whose jurisdiction you are or may be subject by suit upon judgment. You, the Agents and the Arrangers irrevocably agree to waive trial by jury in any suit, action, proceeding, claim or counterclaim brought by or on behalf of any party related to or arising out of the Transactions, this Commitment Letter, the Term Sheets, the Fee Letters or the performance of services hereunder or thereunder. You agree that you will not disclose, directly or indirectly, this Commitment Letter, the Term Sheets, the Original Commitment Letter, the Fee Letters, the Original Fee Letter, the Original Administrative Agent Fee Letter, the contents of any of the foregoing or the activities of the Agents or the Arrangers pursuant hereto or thereto to any person without the prior approval of the Agents and the Arrangers, except that you may disclose (a) this Commitment Letter, the Term Sheets, the Fee Letters and the contents hereof and thereof (i) to (A) the Investors and their respective affiliates and (B) your and their respective shareholders, partners, members, officers, employees, attorneys, accountants and advisors, in the case of clauses (A) and (B), on a confidential and need-to-know basis and (ii) as required by applicable law or compulsory legal process or as requested by a governmental authority, in which case you agree to inform us promptly thereof, (b) this Commitment Letter, the Term Sheets and the contents hereof and thereof (but not the Fee Letters or the contents thereof) to Eagle and its officers, directors, employees, attorneys, accountants and advisors, in each case in connection with the Transactions and on a confidential and need-to-know basis, (c) this Commitment Letter, the Term Sheets and -6- the contents hereof and thereof (but not the Fee Letters or the contents thereof) in any public filing, prospectus or offering memorandum in connection with the Transactions or the financing thereof and (d) the terms of the Facilities and drafts of the definitive documentation in respect of the Facilities to rating agencies on a confidential basis. Please indicate your acceptance of the terms hereof and of the Fee Letter by signing in the appropriate space below and in the Fee Letter and returning to JPMCB the enclosed duplicate originals (or facsimiles) of this Commitment Letter and the Fee Letter not later than 5:00 p.m., New York City time, on December 20, 2004. The Commitments will expire at such time in the event that JPMCB has not then received such executed duplicate originals (or facsimiles) in accordance with the immediately preceding sentence. In the event that the initial borrowing under the Facilities does not occur on or before April 30, 2005, then this Commitment Letter and the Commitments shall automatically terminate unless the Agents and the Arrangers shall, in their sole discretion, agree to an extension. The compensation, reimbursement, indemnification, jurisdiction, syndication, securities demand and confidentiality provisions contained herein and in the Fee Letters shall remain in full force and effect regardless of whether definitive financing documentation shall be executed and delivered and notwithstanding the termination of this Commitment Letter or the Commitments, provided that your obligations under this Commitment Letter, other than those relating to compensation, reimbursement, jurisdiction, syndication, confidentiality and the securities demand shall automatically terminate and be superseded by the definitive documentation relating to the Facilities upon the execution thereof, and you shall be released from all liability in connection therewith at such time. -7- We are pleased to have been given the opportunity to assist you in connection with the financing for the Transactions. Very truly yours, JPMORGAN CHASE BANK, By: /s/ Bruce Borden -------------------------------------- Name: Bruce Borden Title: Vice President J.P. MORGAN SECURITIES INC., By: /s/ Adam Reinmann -------------------------------------- Name: Adam Reinmann Title: Vice President S-1 WACHOVIA BANK, NATIONAL ASSOCIATION, By: /s/ Jim Jefferies -------------------------------------- Name: Jim Jefferies Title: Managing Director WACHOVIA CAPITAL MARKETS, LLC, By: /s/ Jim Jefferies -------------------------------------- Name: Jim Jefferies Title: Managing Director S-2 MERRILL LYNCH, PIERCE, FENNER & SMITH, INCORPORATED, By: /s/ Stephen B. Paras -------------------------------------- Name: Stephen B. Paras Title: Managing Director MERRILL LYNCH CAPITAL CORPORATION, By: /s/ Stephen B. Paras -------------------------------------- Name: Stephen B. Paras Title: Vice President S-3 Accepted and agreed to as of the date first above written: EGL HOLDING COMPANY, By: /s/ Sean M. Traynor ------------------------------------ Name: Sean M. Traynor Title: President S-4 EXHIBIT A CONFIDENTIAL December 20, 2004 Project Eagle ------------- $880,000,000 Senior Secured Credit Facilities --------------------------------------------- Summary of Principal Terms and Conditions ----------------------------------------- BORROWER: EGL Acquisition Corp., a newly-formed Delaware corporation (the "Borrower") and a wholly owned subsidiary of EGL Holding Company, a Delaware corporation ("Holdings"), all the equity interests in which will be owned by one or more affiliates of Welsh, Carson, Anderson & Stowe IX, L.P. (the "Fund") and certain other investors designated by the Fund and reasonably satisfactory to the Agents (together with the Fund, the "Investors"). Following the Merger, the "Borrower" will be a Delaware corporation previously identified to the Agents as "Eagle". TRANSACTIONS: Pursuant to the Agreement and Plan of Merger (the "Merger Agreement") dated October 18, 2004 among Holdings, the Borrower and Eagle, (a) the Borrower will be merged (the "Merger") with and into Eagle, with Eagle surviving the Merger, (b) each outstanding share of common stock of Eagle (other than shares held by holders who properly exercise appraisal rights and shares held by the Investors and Holdings) will be converted in the Merger into the right to receive $18.00 in cash, (c) options and warrants to acquire shares of common stock of Eagle that are "in-the money" will be canceled pursuant to the Merger Agreement in exchange for a lump-sum payment based on the per-share merger consideration of $18.00 (the aggregate amount payable under clauses (b) and (c) is referred to herein as the "Merger Consideration") and (d) shares of common stock of Eagle owned by the Investors in an aggregate amount of not less than $143,100,000 (based on the per share Merger Consideration value) will be contributed to Holdings in return for common and preferred equity of Holdings (the "Roll-over Equity Contribution"). In connection with the Merger, (a) (i) the Investors of Eagle will contribute not less than $617,200,000 in cash to Holdings (it being agreed that the aggregate amount contributed may be reduced by up to $40,000,000 to the Exh. A-1 extent that cash on the balance sheet of the Borrower immediately prior to the Closing Date exceeds (1) if the SemperCare Acquisition Condition (as defined below) has not previously been satisfied, $220,000,000 and (2) if the SemperCare Acquisition Condition has previously been satisfied, $120,000,000) in exchange for common and preferred stock of Holdings, the aggregate proceeds of which will be contributed by Holdings to the Borrower as common equity (such contributions being referred to herein as the "Common Equity Contributions"); and (ii) affiliates of the Fund will purchase for cash subordinated notes and equity of Holdings (the "Holdings Subordinated Notes") yielding gross proceeds of not less than $150,000,000, having terms and conditions reasonably satisfactory to the Agents, the aggregate proceeds of which will be contributed by Holdings to the Borrower as common equity (such contributions, together with the Common Equity Contributions being referred to as the "Equity Contributions"); (b) the Borrower will obtain the senior secured credit facilities (the "Senior Facilities") in the amount and on the terms described below under the caption "Senior Facilities" on the date on which the Merger is consummated (the "Closing Date"); (c) the Borrower will either (i) issue up to $660,000,000 in aggregate principal amount of its senior subordinated notes (the "Senior Subordinated Notes") in a public offering or in a Rule 144A or other private placement or (ii) if and to the extent the Borrower is unable to issue the Senior Subordinated Notes on or prior to the Closing Date, borrow $660,000,000 less the amount of the Senior Subordinated Notes issued pursuant to the immediately preceding clause (i) in senior subordinated loans from one or more lenders under a new senior subordinated bridge facility (the "Bridge Facility" and, together with the Senior Facilities, the "Facilities") (it being agreed that the aggregate principal amount of Senior Subordinated Notes and loans under the Bridge Facility, as applicable, shall be reduced by the amount in excess of $10,000,000 over the sum of (x) the aggregate principal amount of Existing Subordinated Notes (as defined below) not tendered pursuant to the Debt Tender Offer (as defined below) plus (y) the amount of the tender premium offered in respect thereof pursuant to the Debt Tender Offer plus (z) accrued interest in respect thereof (such amount, the "Untendered Amount")); (d) Eagle Exh. A-2 will repay all amounts outstanding under the Credit Agreement dated as of September 22, 2000 (the "Existing Credit Agreement"), among Eagle, certain of its subsidiaries, the lenders named therein, The Chase Manhattan Bank, The Chase Manhattan Bank of Canada, Banc of America Securities, LLC and CIBC, Inc., and will terminate all commitments thereunder and all liens in respect thereof shall be released; (e) Eagle will consummate a tender offer and consent solicitation (the "Debt Tender Offers") in respect of both its 9-1/2% Senior Subordinated Notes due 2009 and its 7-1/2% Senior Subordinated Notes due 2013 (together, the "Existing Subordinated Notes"), pursuant to which Eagle will repurchase at least a majority of each series of the Existing Subordinated Notes at prices and on terms no less favorable than those described in the Merger Agreement or otherwise reasonably satisfactory in all respects to the Agents, and as a result of which all significant negative covenants in each series of such Existing Subordinated Notes will be eliminated; (f) the Merger Consideration will be paid; and (g) fees and expenses incurred by Holdings, the Borrower, Eagle, the Arrangers and the Agents in connection with the Transactions (as defined below), in an aggregate amount not to exceed $133,100,000, will be paid (the "Transaction Costs"). In addition, Eagle is party to an Agreement and Plan of Merger and Reorganization (the "SemperCare Acquisition Agreement") dated November 19, 2004, together with Camp Hill Acquisition Corp., SemperCare, Inc. ("SemperCare") and Jeffrey C. Collinson, as stockholders' agent, pursuant to which Eagle will acquire SemperCare for $100,000,000 in cash (the "SemperCare Acquisition"). The transactions described in clauses (a) through (g) of the preceding paragraph and the transactions described in the second preceding paragraph, are, together with the SemperCare Acquisition if consummated by the Closing Date, collectively referred to herein as the "Transactions". AGENTS: (a) JPMorgan Chase Bank ("JPMCB") will act as sole and exclusive administrative agent and collateral agent for the Senior Facilities (in such capacities, the "Administrative Agent") for a syndicate of financial institutions (the "Lenders"), (b) Wachovia Bank, National Associ- Exh. A-3 ation ("Wachovia") will act as sole and exclusive syndication agent for the Senior Facilities and (c) Merrill Lynch Capital Corporation ("MLCC" and, together with JPMCB and Wachovia, the "Agents") will act as sole and exclusive documentation agent for the Senior Facilities. In such capacities, each Agent will perform the duties customarily associated with such roles. ARRANGERS: J.P. Morgan Securities Inc. ("JPMorgan"), Wachovia Capital Markets, LLC ("WCM") and Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S") will act as joint arrangers for the Senior Facilities (in such capacities, the "Arrangers"), and JPMorgan and WCM will act as joint lead arrangers and joint bookrunners for the Senior Facilities (in such capacities, the "Lead Arrangers"). Each Arranger will perform the duties customarily associated with such roles. JPMorgan will manage the syndication of the Senior Facilities in consultation with the Fund and the other Arrangers. SENIOR FACILITIES: (A) A Senior Secured Tranche B Term Loan Facility in an aggregate principal amount of up to $580,000,000 (the "Tranche B Facility"); provided that the Tranche B Facility shall be reduced to an aggregate principal amount of $480,000,000 at any time prior to the Closing Date that the SemperCare Acquisition Agreement is terminated. (B) A Senior Secured Revolving Credit Facility in an aggregate principal amount of up to $300,000,000 (the "Revolving Facility"). Up to an amount to be agreed upon of the Revolving Facility will be available in the form of letters of credit. In connection with the Revolving Facility, the Administrative Agent will make available to the Borrower a swingline facility under which the Borrower may make short-term borrowings of up to an amount to be agreed upon. Any such swingline loan will reduce availability under the Revolving Facility on a dollar-for-dollar basis. Each Lender under the Revolving Facility will, promptly upon request by the Administrative Agent, fund to the Administrative Agent its pro rata share of any swingline borrowings. Exh. A-4 INCREMENTAL FACILITY: At any time during the term of the Revolving Facility, the Borrower may add an incremental revolving facility or an incremental term loan facility (such facility, the "Incremental Facility") in an aggregate amount of up to $100,000,000. The Incremental Facility will be secured and guaranteed with the Senior Facilities on a pari passu basis. Lenders under the Revolving Facility or Lenders under the Tranche B Facility will be entitled to participate, but will not be required to participate, in an Incremental Facility that consists of revolving loans or term loans, respectively, and any new Lenders that commit to provide a portion of an Incremental Facility shall be reasonably acceptable to the Administrative Agent and the Borrower and, in the case of the Revolving Facility, the Issuing Bank (as defined below). Incremental Facilities consisting of revolving commitments shall not have a scheduled maturity date that is earlier than the Revolving Maturity Date (as defined below) and Incremental Facilities consisting of term loans shall not have a scheduled maturity date that is earlier than the Tranche B Maturity Date (as defined below) and shall not have a weighted average life that is shorter than the Tranche B Facility. If the interest rate spread applicable to the Incremental Facility exceeds the interest rate spread applicable to the analogous Senior Facility by more than 0.50%, then the interest rate spread applicable to the analogous Senior Facility shall be increased so that it equals the interest rate spread equal to such Incremental Facility minus 0.50%. The Incremental Facility will have terms and conditions substantially similar to the analogous Senior Facility and will otherwise be on terms and subject to conditions satisfactory to the Agents. The Incremental Facility will be made available only if, after giving effect thereto, (i) no default or event of default exists under the Credit Agreement with respect to the Senior Facilities (the "Credit Agreement"), and (ii) the Borrower is in pro forma compliance with the financial covenants in the Credit Agreement. PURPOSE: (A) The proceeds of the loans under the Tranche B Facility plus up to $200,000,000 of borrowings under the Revolving Facility (or up to $100,000,000 if the SemperCare Acquisition Condition has not previously been satisfied and the SemperCare Acquisition Agreement has not been terminated), in each case less the Unten- Exh. A-5 dered Amount up to $10,000,000, will be used by the Borrower on the Closing Date, solely (i) first, to pay the Transaction Costs, (ii) second, to pay all principal, interest, fees and other amounts outstanding under the Existing Credit Agreement, (iii) third, to repurchase the Existing Subordinated Notes tendered (and not withdrawn) pursuant to the Debt Tender Offers, including any premium payments associated therewith and (iv) fourth, together with the Equity Contribution, the proceeds of the issuance of the Senior Subordinated Notes and/or the borrowings under the Bridge Facility, as applicable, and cash on hand at Eagle, to pay the Merger Consideration. The estimated sources and uses of the funds necessary to consummate the Transactions and the other transactions contemplated hereby are set forth on Annex II hereto. (B) Except as provided in clause (A) above, the proceeds of loans under the Revolving Facility will be used by the Borrower for working capital and general corporate purposes after the Closing Date. (C) Letters of credit will be used by the Borrower for general corporate purposes. AVAILABILITY: (A) The full amount of the Tranche B Facility must be drawn in a single drawing on the Closing Date. Amounts borrowed under the Tranche B Facility that are repaid or prepaid may not be reborrowed. (B) Loans under the Revolving Facility will be available on (to the extent permitted by clause (A) above under "Purpose") and after the Closing Date at any time prior to the final maturity of the Revolving Facility, in minimum principal amounts to be agreed upon. Amounts repaid under the Revolving Facility may be reborrowed. INTEREST RATES AND FEES: As set forth on Annex I hereto. DEFAULT RATE: With respect to overdue principal, the applicable interest rate plus Exh. A-6 2.00% per annum and, with respect to any other overdue amount, the interest rate applicable to ABR loans plus 2.00% per annum. LETTERS OF CREDIT: Letters of credit under the Revolving Facility will be issued by any Agent or affiliate of any Agent (the "Issuing Bank"). Each letter of credit shall expire not later than the earlier of (a) 12 months after its date of issuance and (b) the fifth business day prior to the final maturity of the Revolving Facility. Drawings under any letter of credit shall be reimbursed by the Borrower on the same business day. To the extent that the Borrower does not reimburse the Issuing Bank on the same business day, the Lenders under the Revolving Facility shall be irrevocably obligated to reimburse the Issuing Bank pro rata based upon their respective Revolving Facility commitments. The issuance of all letters of credit shall be subject to the customary procedures of the Issuing Bank. MATURITY AND AMORTIZATION: (A) The Tranche B Facility will mature on the date that is seven years after the Closing Date (the "Tranche B Maturity Date"), and will amortize in equal quarterly installments in an amount equal to 1.00% per annum during the first six years after the Closing Date, and in four equal quarterly installments during the seventh year after the Closing Date. (B) The Revolving Facility will mature on the date that is six years after the Closing Date (the "Revolving Facility Maturity Date"). GUARANTEES: All obligations of the Borrower under the Senior Facilities and any interest rate protection or other hedging arrangements entered into with a Lender (or any affiliate of any Lender) will be unconditionally guaranteed (the "Guarantees") by Holdings and by each existing and subsequently acquired or organized domestic subsidiary of the Borrower (other than Permitted Joint Ventures (definition to be agreed upon)). Any guarantees to be issued in respect of the Senior Subordinated Notes or the Bridge Facility, as applicable, will be subordinated to the Guarantees to the same extent as the Senior Subord- Exh. A-7 inated Notes or the Bridge Facility, as applicable, are subordinated to the Senior Facilities. SECURIty: The Senior Facilities, the Guarantees and any interest rate protection and other hedging arrangements entered into with a Lender (or any affiliate of any Lender) will be secured by substantially all the assets of Holdings, the Borrower and each other existing and subsequently acquired or organized domestic subsidiary of Holdings (collectively, the "Collateral"), including but not limited to (a) a first-priority pledge of (i) all the capital stock of the Borrower and (ii) all the capital stock held by Holdings, the Borrower or any other domestic subsidiary of Holdings, of each existing and subsequently acquired or organized subsidiary of Holdings (which pledge, in the case of any foreign subsidiary, shall be limited to 65% of the capital stock of such foreign subsidiary) and (b) perfected first-priority security interests in, and mortgages on, substantially all tangible and intangible assets of Holdings, the Borrower and each existing or subsequently acquired or organized domestic subsidiary of Holdings (including but not limited to accounts, inventory, intellectual property, licensing agreements, real property, cash and proceeds of the foregoing). It is understood and agreed that security interests may not be taken pursuant to this paragraph to the extent that the Agents (or, after the Closing Date, the Administrative Agent) determine that the detriment to Eagle of providing such security interest would be excessive in relation to the benefits to the Lenders afforded thereby. All the above-described pledges, security interests and mortgages shall be created on terms, and pursuant to documentation, satisfactory to the Lenders and, subject to certain limited exceptions permitted under the definitive documentation for the Senior Facilities, none of the Collateral shall be subject to any other pledges, security interests or mortgages. MANDATORY PREPAYMENTS: Loans under the Tranche B Facility shall be prepaid with (a) 50% of the Borrower's Excess Cash Flow (to be defined), with stepdowns to 25% and zero based upon the Borrower's ratio of total indebtedness to EBITDA (to be defined) to be agreed upon (with the first payment in respect of Excess Cash Flow required for the first full fiscal year after the Closing Date and due in the following Exh. A-8 year, and with any voluntary prepayments of the Tranche B Facility during any fiscal year to be credited on a dollar-for-dollar basis against any mandatory prepayment required by this clause (a) in the immediately succeeding fiscal year), (b) 100% of the net cash proceeds of all non-ordinary-course asset sales or other dispositions of property by Holdings and its subsidiaries (including insurance and condemnation proceeds), subject to reinvestment provisions and other limited exceptions to be agreed upon, (c) 100% of the net cash proceeds of issuances of debt obligations of Holdings and its subsidiaries (other than (i) the Senior Subordinated Notes, and (ii) other limited debt permitted under the Credit Agreement) and (d) 50% of the net cash proceeds of issuances of equity of Holdings and its subsidiaries (other than limited exceptions to be agreed upon), with stepdowns to 25% and zero based upon the Borrower's ratio of total indebtedness to EBITDA to be agreed upon, provided that, in the case of clauses (c) and (d), the net proceeds of any such issuances of debt or equity will be applied first to repay all outstanding Initial Loans (if any) under the Bridge Facility. The above-described mandatory prepayments shall be applied in order of maturity to the scheduled amortization payments occurring within the next 12 months under the Tranche B Facility and any excess shall be applied pro rata to the remaining amortization payments under the Tranche B Facility. In addition to the foregoing, if the SemperCare Acquisition Agreement has not been terminated prior to the Closing Date, $100,000,000 in aggregate principal amount of Loans under the Tranche B Facility shall be prepaid on the fifth business day after the earlier to occur of (x) the termination of the SemperCare Acquisition Agreement and (y) the date that is 60 days after the Closing Date if the SemperCare Acquisition has not been consummated on or prior to such date in accordance with applicable law, the SemperCare Acquisition Agreement and all other related documentation (without giving effect to amendments to or waivers of such documents that are adverse in any material respect to the Lenders not approved by the Arrangers) (together, the "SemperCare Acquisition Condition"). Exh. A-9 VOLUNTARY PREPAYMENTS/ REDUCTIONS IN COMMITMENTS: Voluntary prepayments of borrowings under the Senior Facilities and voluntary reductions of the unutilized portion of the Revolving Facility commitments will be permitted at any time, in minimum principal amounts to be agreed upon, without premium or penalty, subject to reimbursement of the Lenders' redeployment costs in the case of a prepayment of Adjusted LIBOR borrowings other than on the last day of the relevant Interest Period (to be defined). All voluntary prepayments under the Tranche B Facility shall be applied in order of maturity to the scheduled amortization payments occurring within the next 12 months under the Tranche B Facility and any excess shall be applied pro rata to the remaining amortization payments thereunder. REPRESENTATIONS AND WARRANTIES: Usual for facilities and transactions of this type and others to be reasonably specified by the Administrative Agent, including, without limitation, organization and power; authorization and enforceability; accuracy of financial statements; no material adverse change; absence of litigation or conflicts; no violation of law, agreements or instruments; compliance with laws and regulations (including but not limited to ERISA, margin regulations and environmental laws); payment of taxes; ownership of properties; inapplicability of the Investment Company Act and the Public Utility Holding Company Act; solvency; effectiveness of regulatory, governmental and third-party approvals; labor matters; environmental matters; accuracy of information; validity, priority and perfection of security interests in the Collateral; and designation of the Senior Facilities as "senior indebtedness" under the indenture relating to the Senior Subordinated Notes and the indentures relating to the Existing Subordinated Notes. CONDITIONS PRECEDENT TO INITIAL BORROWING: Usual for facilities and transactions of this type and others to be reasonably specified by the Administrative Agent, including, without limitation, those specified on Exhibit C to the Commitment Letter to which this Term Sheet is attached; delivery of satisfactory legal opinions, audited financial statements and other financial information to be agreed upon; first-priority perfected security Exh. A-10 interests in the Collateral (free and clear of all liens, subject to limited exceptions to be agreed upon); execution of the Guarantees, which shall be in full force and effect; accuracy of representations and warranties; absence of defaults, prepayment events or creation of liens under debt instruments or other agreements as a result of the transactions contemplated hereby; evidence of authority; material consents of all persons; compliance with applicable laws and regulations (including but not limited to ERISA, margin regulations, bank regulatory limitations and environmental laws); there not having occurred since December 31, 2003 any Company Material Adverse Effect; payment of fees and expenses; delivery of borrowing certificates; and delivery of evidence of satisfactory insurance. CONDITIONS PRECEDENT TO EACH BORROWING: Usual and customary for transactions of this type. AFFIRMATIVE COVENANTS: Usual for facilities and transactions of this type and others to be reasonably specified by the Administrative Agent (to be applicable to Holdings and its subsidiaries), including, without limitation, maintenance of corporate existence and rights; performance of obligations; delivery of audited annual consolidated financial statements for Holdings and unaudited quarterly consolidated financial statements for Holdings and other financial information; delivery of notices of default, litigation and material adverse change; maintenance of properties in good working order; maintenance of satisfactory insurance; compliance with laws; inspection of books and properties; further assurances; and payment of taxes. The Borrower will also be required to maintain appropriate interest protection and other hedging arrangements with one or more Lenders (or affiliates thereof) such that the interest cost of at least 50% of all funded debt (including without limitation the Holdings Subordinated Notes and the Senior Subordinated Notes) on the Closing Date shall be fixed for at least three years following the Closing Date. NEGATIVE COVENANTS: Usual for facilities and transactions of this type and others to be reasonably specified by the Administrative Agent (to be applicable to Holdings and its subsidiaries, other than Permitted Joint Ventures), including, without Exh. A-11 limitation, limitations on dividends or other distributions on capital stock (other than (x) payments to shareholders exercising appraisal rights) or (y) subject to compliance with a minimum ratio of EBITDA to cash interest expense, cash amounts sufficient to pay accrued and unpaid interest on the Holdings Subordinated Notes; limitations on redemptions and repurchases of capital stock; limitations on prepayments, redemptions and repurchases of debt; limitations on liens and sale-leaseback transactions; limitations on loans and investments; limitations on debt; limitations on mergers, recapitalizations, acquisitions and asset sales; limitations on transactions with affiliates; limitations on changes in business conducted; prohibition on change in status of Holdings as a passive holding company that holds no assets other than the capital stock of the Borrower; and limitations on amendments of subordinated debt agreements. SELECTED FINANCIAL COVENANTS: (a) A maximum ratio of total indebtedness to EBITDA, (b) a minimum ratio of EBITDA to cash interest expense and (c) maximum capital expenditures (with carry-forward provisions to be agreed upon), in each case with definitions of financial terms and levels (including any credit of unrestricted cash against total indebtedness) to be agreed upon. Solely for purposes of determining compliance with the financial covenants, if Holdings makes equity contributions to the Borrower (such equity contributions to be common equity or preferred equity with terms and conditions no less favorable than those to be specified in the Credit Agreement) after the end of a fiscal period and on or prior to the date that is five business days after the date financial statements are required to be delivered for such fiscal period, the proceeds of which are promptly applied to prepay loans under the Tranche B Facility, then such prepayment of indebtedness shall be deemed to have occurred prior to the end of such fiscal period. In addition, Holdings may make equity contributions to the Borrower (any such equity contribution to be common equity or preferred equity on terms and conditions no less favorable than those to be specified in the Credit Agreement) in an aggregate amount since the Closing Date not to exceed $30,000,000 and with limitations on frequency to be agreed (such contributions, the "Specified Equity Contributions") and each Specified Equity Exh. A-12 Contribution shall be included in the calculation of EBITDA for the purpose of determining compliance with the financial covenants at the end of the fiscal quarter immediately preceding the date of such Specified Equity Contribution and any applicable subsequent periods, provided that the Borrower shall prepay loans under the Revolving Facility, if any (without reducing the commitments thereunder), with the proceeds of such Specified Equity Contribution. The provisions of this paragraph shall only be applicable at such time as there are no amounts outstanding under the Bridge Facility. EVENTS OF DEFAULT: Usual for facilities and transactions of this type and others to be reasonably specified by the Administrative Agent (in certain cases, with grace periods and materiality thresholds to be agreed upon) including, without limitation, nonpayment of principal, interest or other amounts, violation of covenants, inaccuracy of representations and warranties, cross default and cross acceleration, bankruptcy, material judgments, ERISA, actual or asserted invalidity of security documents, Guarantees or the subordination provisions of the Bridge Facility or the Senior Subordinated Notes, as applicable, or the Existing Subordinated Notes and Change in Control (to be defined). VOTING: Amendments and waivers of the Credit Agreement and the other definitive credit documentation will require the approval of Lenders holding more than 50% of the aggregate amount of the loans and commitments under the Senior Facilities, except that (a) the consent of each Lender adversely affected thereby shall be required with respect to, among other things, (i) increases in commitments, (ii) reductions of principal, interest or fees, (iii) extensions of scheduled amortization or final maturity and (iv) releases of all or substantially all the Collateral or material Guarantees (other than in connection with any sale of Collateral or the relevant guarantor permitted by the Credit Agreement) and (b) the consent of Lenders holding more than 50% of any class of loans under the Senior Facilities shall be required with respect to any amendment that by its terms adversely affects the rights of such class in respect of payments or Collateral in a manner different than such amendment affects the other classes. Exh. A-13 COST AND YIELD PROTECTION: Usual for facilities and transactions of this type. ASSIGNMENTS AND PARTICIPATIONS: The Lenders will be permitted to assign loans and commitments to other Lenders (or their affiliates) or to any Federal Reserve Bank without restriction (except that proposed assignments of commitments under the Revolving Facility will require the consent of the Administrative Agent and the Issuing Bank) or to other financial institutions with the consent of the Borrower (unless certain defaults or events of default have occurred and are continuing) and the Administrative Agent (and, in the case of assignments of commitments under the Revolving Facility, the Issuing Bank), in each case not to be unreasonably withheld. Each assignment (except to other Lenders or their affiliates) will be in a minimum amount of (a) $5,000,000 in respect of loans and commitments under the Revolving Facility and (b) $1,000,000 in respect of loans and commitments under the Tranche B Facility. The Administrative Agent will receive a processing and recordation fee of $3,500, payable by the assignor and/or the assignee, with each assignment. Assignments will be by novation and will not be required to be pro rata among the Senior Facilities. The Lenders will be permitted to participate loans and commitments without restriction. Voting rights of participants shall be limited to matters in respect of (a) increases in commitments, (b) reductions of principal, interest or fees, (c) extensions of scheduled amortization or final maturity and (d) releases of all or substantially all the Collateral or material Guarantees (other than in connection with any sale of Collateral or the relevant guarantor permitted by the Credit Agreement). EXPENSES AND INDEMNIFICATION: All reasonable out-of-pocket expenses (including, without limitation, expenses incurred in connection with due diligence) of the Arrangers and the Agents associated with the syndication of the Senior Facilities and with the preparation, execution and delivery, administration, waiver or modification and enforcement of the Credit Agreement and the other documentation contemplated hereby and thereby (including the reasonable fees, disbursements and other charges of counsel to the Agents and Arrangers) are to be paid by the Borrower. In addition, all reasonable out-of-pocket expenses of the Lenders for enforcement costs and documentary taxes associ- Exh. A-14 ated with the Senior Facilities are to be paid by the Borrower. The Borrower will indemnify the Arrangers, the Agents, the other Lenders and their affiliates and their respective officers, directors, employees, affiliates, agents and controlling persons and hold them harmless from and against all costs, expenses (including reasonable fees, disbursements and other charges of counsel) and liabilities of any such indemnified person arising out of or relating to any claim or any litigation or other proceedings (regardless of whether any such indemnified person is a party thereto) that relate to the proposed Transactions, including the financing contemplated thereby, or any transactions connected therewith, provided that none of the Arrangers, the Agents or any other Lender (nor any of their respective officers, directors, employees, affiliates, agents and controlling persons) will be indemnified for its gross negligence or willful misconduct. Any costs or expenses advanced pursuant to the foregoing provisions shall be reimbursed to the extent that such costs or expenses are finally judicially determined to have resulted from the gross negligence or willful misconduct of the indemnified party by a court of competent jurisdiction. GOVERNING LAW AND FORUM: New York. COUNSEL TO THE AGENTS AND ARRANGERS: Cahill Gordon & Reindel LLP. Exh. A-15 ANNEX I INTEREST RATES: The interest rates under the Senior Facilities will be as follows: Revolving Facility ------------------ At the option of the Borrower, Adjusted LIBOR plus 2.50% or ABR plus 1.50%, subject to stepdowns to be agreed upon based upon the Borrower's ratio of total indebtedness to EBITDA. Tranche B Facility ------------------ At the option of the Borrower, Adjusted LIBOR plus 2.50% or ABR plus 1.50%. All Senior Facilities --------------------- The Borrower may elect interest periods of 1, 2, 3 or 6 months (or, to the extent made available by the applicable Lenders, 9 or 12 months) for Adjusted LIBOR borrowings. Calculation of interest shall be on the basis of actual days elapsed in a year of 360 days (or 365 or 366 days, as applicable, in the case of ABR loans based on the Prime Rate) and interest shall be payable at the end of each interest period and, in any event, at least every 3 months or 90 days, as applicable. ABR is the Alternate Base Rate, which is the higher of JPMCB's Prime Rate and the Federal Funds Effective Rate plus 1/2 of 1.00%. Adjusted LIBOR will at all times include statutory reserves. LETTER OF CREDIT FEE: A per annum fee equal to the spread over Adjusted LIBOR under the Revolving Facility will accrue on the aggregate face amount of outstanding letters of credit under the Revolving Facility, payable in arrears at the end of each quarter and upon the termination of the Revolving Facility, in each case for the actual number of days elapsed over a 360-day year. Such fees shall be A-I-1 distributed to the Lenders participating in the Revolving Facility pro rata in accordance with the amount of each such Lender's Revolving Facility commitment. In addition, the Borrower shall pay to the Issuing Bank, for its own account, (a) a fronting fee of 0.125% per annum on the aggregate face amount of outstanding letters of credit, payable in arrears at the end of each quarter and upon the termination of the Revolving Facility, in each case for the actual number of days elapsed over a 360-day year, and (b) customary issuance and administration fees. COMMITMENT FEES: 0.50% per annum, with a stepdown to 0.375% based upon the Borrower's ratio of total indebtedness to EBITDA, on the undrawn portion of the commitments in respect of the Revolving Facility, commencing to accrue on the Closing Date and payable quarterly in arrears after the Closing Date. For the purpose of calculating the commitment fee, outstanding swingline loans will be deemed not to utilize the Revolving Facility commitments. A-I-2 ANNEX II Estimated Sources and Uses of Funds (in millions) Uses of Funds Sources of Funds - ------------- ---------------- Merger Consideration $ 1,835.4 Tranche B Facility $ 580.01 Roll-over Equity 143.1 Revolving Facility 200.02 Refinance Existing Debt3 350.0 Senior Subordinated Notes 660.04 Transaction Costs5 133.1 Holdings Subordinated Notes 150.0 SemperCare Purchase Price6 Equity Contributions 617.27 100.0 Roll-over Equity 143.1 Cash on Balance Sheet 10.0 Excess Cash on Balance Sheet 221.3 ------------ ------------ Total Uses $ 2,571.6 Total Sources $ 2,571.6 ============ ============
- ------------------------- 1 To be reduced to $480,000,000 under the circumstances described in the Senior Facilities Term Sheet. 2 To be reduced to $100,000,000 if the SemperCare Acquisition Condition has not previously been satisfied and the SemperCare Acquisition Agreement has not been terminated. Amount of Revolving Facility to be drawn on the Closing Date to be decreased in each case by the Untendered Amount up to $10,000,000. 3 Includes the Existing Credit Agreement and the Existing Subordinated Notes and assumes all the Existing Subordinated Notes are repurchased pursuant to the Debt Tender Offers. 4 To be decreased by the Untendered Amount in excess of $10,000,000. 5 Includes tender premium to be paid in connection with the Debt Tender Offers. 6 Assumes the SemperCare Acquisition is consummated on or prior to the Closing Date. 7 To be decreased by up to $40,000,000 to the extent Excess Cash on Balance Sheet immediately prior to the Closing Date exceeds (a) if the SemperCare Acquisition Condition has not previously been satisfied, $220,000,000 and (b) if the SemperCare Acquisition Condition has previously been satisfied, $120,000.000. A-II-1 EXHIBIT B CONFIDENTIAL December 20, 2004 Project Eagle -------------- $660,000,000 Senior Subordinated Bridge Facility ------------------------------------------------ Summary of Principal Terms and Conditions ----------------------------------------- INITIAL LOANS: The Lenders (as defined below) will make loans (the "Initial Loans") to the "Borrower" (as defined below) on the Closing Date (as defined in Exhibit A to the Commitment Letter to which this Exhibit B is attached) in an aggregate principal amount of up to $660,000,000 less the Untendered Amount in excess of $10,000,000. The Agents (as defined below) and each assignee of any portion of the Initial Loans or of the Agents' commitments to make the Initial Loans are collectively referred to as the "Lenders". BORROWER: EGL Acquisition Corp., a newly-formed Delaware corporation (the "Borrower") and a wholly owned subsidiary of EGL Holding Company, a Delaware corporation ("Holdings"), all the equity interests in which will be owned by one or more affiliates of Welsh, Carson, Anderson & Stowe IX, L.P. (the "Fund") and certain other investors designated by the Fund and reasonably satisfactory to the Agents. Following the Merger described under the heading "Transactions" in Exhibit A to the Commitment Letter to which this Exhibit B is attached, the "Borrower" will be a Delaware corporation previously identified to the Agents as "Eagle". GUARANTEES: The obligations of the Borrower in respect of the Initial Loans will be unconditionally and irrevocably guaranteed on a senior subordinated basis by each subsidiary of the Borrower that is a guarantor of the Senior Facilities (as defined below). Guarantors will be released in a manner consistent with the Senior Facilities. AGENT: Merrill Lynch Capital Corporation ("MLCC") will act as sole and exclusive administrative agent (the "Administrative Agent"). In such capacity, MLCC will perform Exh. B-1 the duties customarily associated with such role and with customary compensation. ARRANGERS: Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S"), J.P. Morgan Securities Inc. ("JPMorgan") and Wachovia Capital Markets, LLC ("WCM") will act as joint arrangers and joint bookrunners (in such capacities, the "Arrangers"). Each Arranger will perform the duties customarily associated with such roles. MLPF&S will manage the syndication of the Bridge Facility in consultation with the Fund and the other Arrangers. LENDERS: A syndicate of banking and financial institutions arranged by the Arrangers. TRANSACTIONS: As set forth in Exhibit A to the Commitment Letter to which this Exhibit B is attached. Capitalized terms used but not defined herein shall have the meanings assigned to such terms in Exhibit A to the Commitment Letter to which this Exhibit B is attached. USE OF PROCEEDS: The proceeds of the Initial Loans will be used by the Borrower on the Closing Date, together with the proceeds of the issuance of the Senior Subordinated Notes, as applicable, a portion of the proceeds of the loans under the Senior Facilities, the Equity Contribution and cash on hand at Eagle, to pay the Merger Consideration. The estimated sources and uses of the funds necessary to consummate the Transactions and the other transactions contemplated hereby are set forth on Annex II to Exhibit A to the Commitment Letter to which this Exhibit B is attached. The amount drawn under the Initial Loans will be reduced by an amount equal to the Untendered Amount in excess of $10,000,000. FUNDING: The Lenders will make the Initial Loans simultaneously with (a) the consummation of the Transactions (including, without limitation, the Equity Contributions) and (b) the initial funding under the Senior Facilities. MATURITY/EXCHANGE: All the Initial Loans will mature on the date that is one year following the Closing Date (the "Maturity Date"). If any Initial Loan has not been previously repaid in full on or prior to the Maturity Date, the Lender in respect of such Initial Loan thereafter will have the option at any Exh. B-1 time or from time to time to receive Exchange Notes (the "Exchange Notes") in exchange for such Initial Loan having the terms set forth in the term sheet attached hereto as Annex I; provided, however, that a Lender may not elect to exchange only a portion of its outstanding Initial Loans for Exchange Notes unless such Lender intends at the time of such partial exchange of Initial Loans promptly to sell the Exchange Notes received in such exchange. If any Lender does not exchange its Initial Loans for Exchange Notes on the Maturity Date, such Lender shall be required to extend the maturity of such Initial Loans to another date selected by such Lender. If, at such extended maturity, such Lender does not exchange its Initial Loans, such Lender shall be required again to extend the maturity of such Initial Loans to another date selected by such Lender (provided that such Lender shall not be required to extend the maturity of such Initial Loans beyond the tenth anniversary of the Closing Date (the "Final Maturity Date")), and this sentence shall apply to each extended maturity of such Initial Loans prior to the Final Maturity Date. The Initial Loans and the Exchange Notes shall be pari passu for all purposes. INTEREST: For the first three-month period commencing on the Closing Date, interest on the Initial Loans shall accrue at a rate per annum equal to the higher of (i) three-month adjusted LIBOR ("Adjusted LIBOR") as determined on the Closing Date plus a spread (the "Spread") and (ii) 8.50%. The Spread shall initially be determined on the Closing Date and shall initially equal 650 basis points. If the Initial Loans are not repaid in full within three months following the Closing Date, the Spread will increase by 50 basis points at the end of such three-month period and shall increase by an additional 50 basis points at the end of each three-month period thereafter until the Maturity Date. Notwithstanding the foregoing, (a) the interest rate in effect at any time prior to the Maturity Date shall not exceed 12% per annum, (b) the interest rate in effect at any time prior to the Maturity Date shall not be less than 8.50% per annum and (c) to the extent the interest payable prior to the Maturity Date on any Initial Loan ex- Exh. B-3 ceeds a rate of 10% per annum, the Borrower may, at its option, cause such excess interest to be paid by adding such excess interest to the principal amount of such Initial Loan. In no event shall the interest rate on the Initial Loans exceed the highest lawful rate permitted under applicable law. Overdue amounts will bear interest at the rate applicable to the Initial Loans plus 2.00% per annum. Following the Maturity Date, all outstanding Initial Loans will accrue interest at the rate provided for the Exchange Notes in Annex I hereto, subject to the absolute and cash caps applicable to the Exchange Notes. Calculation of interest shall be on the basis of actual days elapsed in a year of 360 days (or 365 or 366 days, as the case may be, in the case of Initial Loans based on JPMCB's Prime Rate). Adjusted LIBOR will at all times include statutory reserves. In the event that Adjusted LIBOR cannot be determined, or any Lender is unable to maintain a loan accruing interest at Adjusted LIBOR, the affected Initial Loans will accrue interest until the Maturity Date at the "Alternate Base Rate", which will be the higher of JPMCB's Prime Rate and the Federal Funds Effective Rate plus 1/2 of 1.00%, plus, in each case, a spread. Such spread shall initially be 550 basis points and shall increase by 50 basis points at the end of each three-month period subsequent to the Closing Date until the Maturity Date. Interest will be payable in arrears (a) for Initial Loans accruing interest at a rate based on Adjusted LIBOR, at the end of each Adjusted LIBOR period following the Closing Date and on the Maturity Date, (b) for Initial Loans accruing interest at a rate based on the Alternate Base Rate, at the end of each fiscal quarter of the Borrower following the Closing Date and on the Maturity Date and (c) for Initial Loans outstanding after the Maturity Date, at the end of each fiscal quarter of the Borrower following the Maturity Date. Exh. B-4 SUBORDINATION: The Initial Loans will be subordinated to the Senior Facilities and other senior indebtedness of the Borrower on terms customary for senior subordinated facilities and transactions of this type. SENIOR FACILITIES: The Borrower will obtain the $880,000,000 (or $780,000,000 if the SemperCare Acquisition Agreement is terminated prior to the Closing Date) senior secured credit facilities (the "Senior Facilities"), all as described in Exhibit A to the Commitment Letter to which this Exhibit B is attached. MANDATORY REDEMPTION: The Borrower will be required to prepay Initial Loans (and, if issued, Exchange Notes, to the extent required by the terms of such Exchange Notes) on a pro rata basis, at par plus accrued and unpaid interest, from the net proceeds (after deduction of, among other things, amounts required to repay the Senior Facilities) from the incurrence of any debt or the issuance of any equity or from all non-ordinary-course asset sales (subject to exceptions and baskets to be agreed upon). OPTIONAL PREPAYMENT: The Initial Loans may be prepaid, in whole or in part, at the option of the Borrower, at any time upon three days' prior notice, at par plus accrued and unpaid interest, subject to reimbursement of the Lenders' actual redeployment costs in the case of a prepayment of Adjusted LIBOR borrowings other than on the last day of the relevant interest period. If the Borrower elects to optionally prepay all or any portion of the Initial Loans, then the Borrower shall be required to optionally redeem on a pro rata basis outstanding Exchange Notes, if any, subject, in certain circumstances, to the non-call provisions of any Fixed Rate Exchange Notes, at par plus accrued and unpaid interest. DOCUMENTATION: Usual for facilities and transactions of this type and reasonably satisfactory to the Arrangers. REPRESENTATIONS AND WARRANTIES: Usual for facilities and transactions of this type and reasonably satisfactory to the Arrangers. CONDITIONS PRECEDENT: Usual for facilities and transactions of this type, those specified below and in the Commitment Letter to which Exh. B-5 this Exhibit B is attached (including Exhibit A (other than the clause therein that refers to security interests in collateral) and Exhibit C thereto) and others to be reasonably specified by the Agents, including, without limitation, delivery of satisfactory legal opinions, audited financial statements and other financial information to be agreed upon; execution of guarantees, which shall be in full force and effect; accuracy of representations and warranties; absence of conflicts with applicable law and of defaults, prepayment events or creation of liens under debt instruments or other agreements as a result of the transactions contemplated hereby; evidence of authority; material consents of all persons; compliance with applicable laws and regulations (including but not limited to ERISA, margin regulations, bank regulatory limitations and environmental laws); there not having occurred since December 31, 2003 any Company Material Adverse Effect; payment of fees and expenses; delivery of borrowing certificates; and delivery of evidence of satisfactory insurance. The Borrower shall have received not less than $780,000,000 (or $680,000,000 if the SemperCare Acquisition Condition is not satisfied prior to the Closing Date) (in each case not including undrawn commitments), less the Untendered Amount up to $10,000,000, in gross cash proceeds from borrowings under the Senior Facilities. The terms and conditions of the Senior Facilities (including but not limited to terms and conditions relating to the interest rate, fees, maturity, subordination, covenants, events of defaults and remedies) shall be reasonably satisfactory in all respects to the Lenders. The Investment Banks (as defined in the Fee Letter) shall have received, as soon as practicable but in no event later than 45 days prior to the Closing Date, a substantially complete initial draft of a registration statement or a Rule 144A offering memorandum or other private placement memorandum relating to the Senior Subordinated Notes. The Investment Banks shall have been afforded a reasonable period, which shall not be less than 30 days, following the receipt of a complete printed preliminary prospectus or preliminary offering memorandum or pre- Exh. B-6 liminary private placement memorandum suitable for use in a customary high-yield road show relating to the issuance of the Senior Subordinated Notes to attempt to place such Notes with qualified purchasers thereof. Such preliminary prospectus, offering memorandum or private placement memorandum shall contain all financial statements and other data to be included therein (including all audited financial statements, all unaudited financial statements (which shall have been reviewed by the independent accountants for Eagle as provided in Statement on Auditing Standards No. 100) and all appropriate pro forma financial statements prepared in accordance with, or reconciled to, generally accepted accounting principles in the United States and prepared in accordance with Regulation S-X under the Securities Act of 1933, as amended) and all other data (including selected financial data) that the Securities and Exchange Commission would require in a registered offering of the Senior Subordinated Notes or that would be necessary for the Investment Banks to receive customary "comfort" (including "negative assurance" comfort) from independent accountants in connection with the offering of the Senior Subordinated Notes; provided that narrative disclosure with respect to the financial performance of non-guarantor subsidiaries shall be included in a form to be agreed upon. The Agents shall have received management's consolidated financial projections for the Borrower and its subsidiaries for the period of seven years following the Closing Date, which projections shall reflect the Transactions and the other transactions contemplated hereby and include the written assumptions upon which such projections are based, and such projections shall be reasonably satisfactory to the Agents, including with respect to any cost savings projected for the Borrower and its subsidiaries therein. Such projections shall be substantially similar in form to the projections (the "Initial Projections") received by the Agents prior to the date of the Commitment Letter to which this Exhibit B is attached. COVENANTS: Usual for facilities and transactions of this type and reasonably satisfactory to the Arrangers, including certain financial covenants (including maintenance covenants) Exh. B-7 to be mutually agreed upon by the Borrower and the Lenders. The affirmative covenants shall in any event include delivery of financial projections of Borrower and its subsidiaries updated quarterly in a form substantially similar to that described above under the heading "Conditions Precedent". Following the Maturity Date, all outstanding Initial Loans will bear covenants substantially identical to the covenants of the Exchange Notes. EVENTS OF DEFAULT: Usual for facilities and transactions of this type and reasonably satisfactory to the Arrangers (in certain cases with grace periods and materiality thresholds to be agreed upon). Following the Maturity Date, the events of default relevant to the Initial Loans will be automatically modified to be consistent with the Exchange Notes. COST AND YIELD PROTECTION: Usual for facilities and transactions of this type. ASSIGNMENT AND PARTICIPATION: Subject to the consent of the Administrative Agent (not to be unreasonably withheld or delayed), the Lenders will have the absolute and unconditional right to assign Initial Loans and commitments without the consent of the Borrower. The Administrative Agent will receive a processing and recordation fee of $3,500, payable by the assignor and/or the assignee, with each assignment. Assignments will be by novation which will release the obligation of the assigning Lender. Subject to the consent of the Administrative Agent (not to be unreasonably withheld or delayed), Lenders will be permitted to participate their Initial Loans to other financial institutions without restriction, other than customary voting limitations. Participants will have the same benefits as the selling Lenders would have (and will be limited to the amount of such benefits) with regard to yield protection and increased costs. Exh. B-8 VOTING: Amendments and waivers of the documentation for the Initial Loans and the other definitive credit documentation related thereto will require the approval of Lenders holding more than 50% of the outstanding Initial Loans, except that the consent of each affected Lender will be required for (a) reductions of principal, interest rates or fees, (b) releases of all or substantially all the material guarantees, (c) modification in any manner adverse to the Lenders of any provisions relating to subordination, (d) except as provided under "Maturity/Exchange" above, extensions of the Maturity Date, (e) additional restrictions on the right to exchange Initial Loans for Exchange Notes or any amendment of the rate of such exchange, (f) any amendment to the Exchange Notes that requires (or would, if any Exchange Notes were outstanding, require) the approval of all holders of Exchange Notes or (g) modifications of any voting percentages. EXPENSES AND INDEMNIFICATION: All reasonable out-of-pocket expenses (including but not limited to expenses incurred in connection with due diligence) of the Lenders, the Agents and the Arrangers associated with the preparation, execution and delivery, administration, waiver or modification and enforcement of the Senior Subordinated Facility and the other documentation contemplated hereby and thereby (including the reasonable fees, disbursements and other charges of counsel) are to be paid by the Borrower. In addition, all reasonable out-of-pocket expenses of the Lenders for enforcement costs and documentary taxes associated with the facility are to be paid by the Borrower. The Borrower will indemnify the Lenders, the Agents and the Arrangers, and their respective officers, directors, employees, affiliates, agents and controlling persons, and hold them harmless from and against all costs, expenses (including but not limited to reasonable fees and out-of-pocket charges and disbursements of counsel) and liabilities of any such Lender, the Agents or the Arrangers arising out of or relating to any claim or any litigation or other proceeding (regardless of whether any such Lender, the Agents or the Arrangers is a party thereto) that relate to the proposed transactions, including but not limited to the Transactions or any transac- Exh. B-9 tions connected therewith; provided, however, that no such person (nor any of their respective officers, directors, employees, affiliates, agents or controlling persons) will be indemnified for costs, expenses or liabilities arising from such person's gross negligence or wilful misconduct. Any costs or expenses advanced pursuant to the foregoing provisions shall be reimbursed to the extent that such costs or expenses are finally judicially determined to have resulted from the gross negligence or willful misconduct of the indemnified party. GOVERNING LAW AND FORUM: New York. COUNSEL FOR THE AGENTS AND THE ARRANGERS: Cahill Gordon & Reindel LLP. Exh. B-10 ANNEX I to Exhibit B Project Eagle -------------- Summary of Principal Terms and Conditions ------------------------------------------ of Exchange Notes ----------------- Capitalized terms used but not defined herein have the meanings given in the Summary of Principal Terms and Conditions of the $660,000,000 Senior Subordinated Bridge Facility to which this Annex I is attached. ISSUER: The Borrower will issue Exchange Notes under an indenture that complies with the Trust Indenture Act (the "Indenture"). The Borrower in its capacity as issuer of the Exchange Notes is referred to as the "Issuer". GUARANTEES: Same as Initial Loans. PRINCIPAL AMOUNT: The Exchange Notes will be available only in exchange for the Initial Loans. The principal amount of any Exchange Note will equal 100% of the aggregate principal amount (including any accrued interest not required to be paid in cash) of the Initial Loan for which it is exchanged. MATURITY: The Exchange Notes will mature on the tenth anniversary of the Closing Date. INTEREST RATE: The Exchange Notes will bear interest at a rate equal to the Initial Rate (as defined below) plus the Exchange Spread (as defined below). Notwithstanding the foregoing, the interest rate in effect at any time shall not exceed 12% per annum nor be less than 10.50% per annum, and to the extent the interest payable on any Exchange Note exceeds a rate of 10% per annum, the Issuer may, at its option, cause such excess interest to be paid by issuing additional Exchange Notes in a principal amount equal to such excess interest. In no event shall the interest rate on the Exchange Notes exceed the highest lawful rate permitted under applicable law. "Exchange Spread" shall mean 0 basis points during the three-month period commencing on the Maturity Date and shall increase by 50 basis points at the beginning of each subsequent three month period. 1-B-1 "Initial Rate" shall be determined on the Maturity Date and shall equal the interest rate borne by the Initial Loans on the day immediately preceding the Maturity Date plus 50 basis points. Interest will be payable in arrears at the end of each fiscal quarter of the Issuer. SUBORDINATION: Same as Initial Loans. MANDATORY REDEMPTION: The Issuer will be required to redeem the Exchange Notes or, in the case of Fixed Rate Exchange Notes, to offer to purchase such notes (and, if outstanding, repay the Initial Loans) on a pro rata basis, at par plus accrued and unpaid interest, from the net proceeds (after deduction of, among other things, amounts required to repay the Senior Facilities) from all nonordinary- course asset sales (subject to exceptions and baskets to be agreed upon). OPTIONAL REDEMPTION: Subject to the following sentence, the Exchange Notes will be redeemable at the option of the Issuer, in whole or in part, at any time at par plus accrued and unpaid interest to the redemption date. If any Exchange Note is sold by a Lender to a third-party purchaser, such Lender shall have the right to fix the interest rate on such Exchange Note (each such Note, a "Fixed Rate Exchange Note") at (a) a rate not higher than the then applicable rate of interest on such Exchange Note or (b) upon the representation of such transferring Lender that a higher rate (such higher rate, the "Transfer Rate") is necessary in order to permit such Lender to transfer such Exchange Note to a third party and receive consideration equal to the principal amount thereof plus all accrued and unpaid interest to the date of such transfer; provided, however, that such Transfer Rate shall not exceed 12% per annum. If such Lender exercises such right, such Fixed Rate Exchange Note will be non-callable for four years (except that up to 35% of the principal amount thereof may be called at a premium to be agreed upon with the proceeds of a Qualified IPO (to be defined)) from the date of the initial issuance of Exchange Notes and will be callable thereafter at par plus accrued interest plus a premium equal to (a) the coupon in effect on the date of sale of the Exchange Notes or (b) if the Transfer Rate 1-B-2 was used, the Transfer Rate, which premium in either case shall decline ratably on each yearly anniversary of the date of such sale to zero one year prior to the maturity of the Exchange Notes (except that if such period has not ended prior to the date that is one year prior to such maturity, such premium shall fall immediately to zero on the date that is one year prior to such maturity), provided that such call protection shall not apply to any call for redemption issued prior to the sale to such third-party purchaser. If the Issuer elects to optionally redeem all or any portion of the Exchange Notes, then the Issuer shall be required to optionally prepay on a pro rata basis outstanding Initial Loans, if any, at par plus accrued and unpaid interest. REGISTRATION RIGHTS: The Issuer will file within 60 days after the Maturity Date, and will use its commercially reasonable efforts to cause to become effective as soon thereafter as practicable, a shelf registration statement with respect to the Exchange Notes (a "Shelf Registration Statement") and/or a registration statement relating to a Registered Exchange Offer (as described below). If a Shelf Registration Statement is filed, the Issuer will keep such registration statement effective and available (subject to customary exceptions) until it is no longer needed to permit unrestricted resales of Exchange Notes but in no event longer than two years from the Maturity Date. If within 150 days from the Maturity Date, a Shelf Registration Statement for the Exchange Notes has not been declared effective or the Issuer has not effected an exchange offer (a "Registered Exchange Offer") whereby the Issuer has offered registered notes having terms identical to the Exchange Notes (the "Substitute Notes") in exchange for all outstanding Exchange Notes and Initial Loans (it being understood that a Shelf Registration Statement is required to be made available in respect of Exchange Notes the holders of which could not receive Substitute Notes through the Registered Exchange Offer that, in the opinion of counsel, would be freely saleable by such holders without registration or requirement for delivery of a current prospectus under the Securities Act (other than a prospectus-delivery requirement imposed on a broker-dealer who is exchanging Exchange Notes ac- 1-B-3 quired for its own account as a result of a market making or other trading activities)), then the Issuer will pay liquidated damages of $0.096 per week per $1,000 of principal amount of Exchange Notes and Initial Loans outstanding (which rate of liquidated damages shall increase by 0.048 every 90 days up to a maximum of $0.192 per week) to holders of such Exchange Notes and Initial Loans who are unable freely to transfer Exchange Notes from and including the 151st day after the date of the first issuance of Exchange Notes to but excluding the earlier of the effective date of such Shelf Registration Statement or the date of consummation of such Registered Exchange Offer (such damages to be payable in the form of additional Initial Loans or Exchange Notes, as applicable, if the then interest rate thereon exceeds the applicable cash interest rate cap). The Issuer will also pay such liquidated damages for any period of time (subject to customary exceptions) following the effectiveness of a Shelf Registration Statement during which such Shelf Registration Statement is not available for resales thereunder. In addition, unless and until the Issuer has consummated the Registered Exchange Offer and, if required, caused the Shelf Registration Statement to become effective, the holders of the Exchange Notes will have the right to "piggy-back" the Exchange Notes in the registration of any debt securities (subject to customary scale-back provisions) that are registered by the Issuer (other than on a Form S-4) unless all the Exchange Notes and Initial Loans will be redeemed or repaid from the proceeds of such securities. EXCHANGE NOTES ESCROWED: The Exchange Notes will be delivered on the Closing Date and held, undated, in escrow by a mutually agreeable fiduciary. RIGHT TO TRANSFER EXCHANGE NOTES: The holders of the Exchange Notes shall have the absolute and unconditional right to transfer such Exchange Notes in compliance with applicable law to any third parties. COVENANTS: Usual for those contained in an indenture governing senior subordinated notes issued in a Rule 144A offering. 1-B-4 EVENTS OF DEFAULT: Usual for those contained in an indenture governing senior subordinated notes issued in a Rule 144A offering. GOVERNING LAW AND FORUM: New York. 1-B-5 EXHIBIT C Project Eagle ------------- Senior Secured Credit Facilities -------------------------------- Senior Subordinated Bridge Facility ----------------------------------- Summary of Additional Conditions Precedent ------------------------------------------ The initial borrowings under the Facilities shall be subject to the following conditions precedent. All capitalized terms used but not defined herein shall have the meanings set forth in the Commitment Letter to which this Exhibit C is attached, the Senior Facilities Term Sheet and the Bridge Facility Term Sheet. 1. The Transactions shall have been consummated or shall be consummated simultaneously with the closing of the Facilities in accordance with applicable law, the Merger Agreement and all other related documentation and, if applicable, the SemperCare Acquisition Agreement and all other related documentation (in each case without giving effect to any amendments or waivers to or of such documents that are adverse in any material respect to the Lenders not approved by the Arrangers), and no more than 8% of the outstanding common stock of Eagle shall constitute shares held by holders who properly exercise appraisal rights. The Transactions shall have been consummated in a manner consistent with the sources and uses shown on Annex II to the Senior Facilities Term Sheet. 2. The Equity Contributions shall have been made. 3. Eagle shall concurrently (a) repurchase at least a majority of each series of the Existing Subordinated Notes pursuant to the Debt Tender Offers at prices and on terms reasonably satisfactory in all respects to the Agents and, as a result of which, all significant negative covenants in the Existing Subordinated Notes shall be eliminated and (b) pay all principal, interest, fees and other amounts outstanding under the Existing Credit Agreement, and terminate all commitments under the Existing Credit Agreement and cause all liens in respect thereof to be terminated. 4. With respect to the Senior Facilities, the Borrower shall have received either (a) $660,000,000 in gross cash proceeds from the issuance of the Senior Subordinated Notes or (b) if and to the extent the Borrower is unable to issue the Senior Subordinated Notes prior to the Closing Date, $660,000,000 less the amount of Senior Subordinated Notes issued pursuant to clause (a) in gross cash proceeds from loans under the Bridge Facility (it being agreed that the aggregate principal amount of Senior Subordinated Notes and loans under the Bridge Facility, as applicable, shall be reduced by the Untendered Amount in excess of $10,000,000). With respect to the Bridge Facility, the Borrower shall have received $580,000,000 in gross cash proceeds from the borrowings under the Tranche B Facility (or $480,000,000 if the SemperCare Acquisition Agreement is terminated prior to the Closing Date) and $200,000,000 in Exh. C-1 gross cash proceeds from the borrowings under the Revolving Facility (or $100,000,000 if the SemperCare Acquisition Condition has not previously been satisfied and the SemperCare Acquisition has not been terminated), in each case less the Untendered Amount up to $10,000,000. 5. After giving effect to the Transactions and the other transactions contemplated hereby, Holdings and its subsidiaries shall have outstanding no indebtedness or preferred stock other than (a) the loans and other extensions of credit under the Senior Facilities, (b) the Senior Subordinated Notes or loans under the Bridge Facility, as applicable, (c) the Holdings Subordinated Notes, (d) preferred stock issued to the Investors in connection with the Transactions and (e) other limited indebtedness to be agreed upon. The terms and conditions of (a) all indebtedness to remain outstanding after the Closing Date (including but not limited to terms and conditions relating to interest rates, fees, amortization, maturity, redemption, subordination, covenants, events of default and remedies) and (b) all preferred stock to be issued in connection with the Transactions or to remain outstanding after the Closing Date (including but not limited to terms and conditions relating to cash dividend payments, dividend rates, redemption, subordination, covenants, conversion, voting rights, events of default and remedies) shall be reasonably satisfactory in all material respects to the Lenders. 6. The Lenders shall have received (a) audited consolidated balance sheets and related statements of income, stockholders' equity and cash flows of the Borrower for the three fiscal years ended December 31, 2003 (and of SemperCare, if the SemperCare Acquisition Agreement has not previously been terminated, for the fiscal year ended December 31, 2003, the six months ended December 31, 2002 and the fiscal year ended June 30, 2002) and, if available, the audited financial statements for the fiscal year ending December 31, 2004, which in any event shall be provided within 75 days after fiscal year end in the case of the Borrower (and, if applicable, when available in the case of SemperCare), (b) unaudited consolidated balance sheets and related statements of income, stockholders' equity and cash flows of the Borrower (and SemperCare, if the SemperCare Acquisition Agreement has not previously been terminated) for each subsequent fiscal quarter (and, if the audited financial statements for the year ending December 31, 2004 are not required to be provided pursuant to clause (a), unaudited financial statements or summary financial information for the Borrower (and SemperCare, if the SemperCare Acquisition Agreement has not previously been terminated) for such fiscal year) ended at least 40 days before the Closing Date (and comparable periods for the prior fiscal year), and (c) if the Closing Date is on or prior to February 10, 2005, summary financial data for the Borrower (and SemperCare, if the SemperCare Acquisition Agreement has not previously been terminated) for the twelve months ended November 30, 2004 or, if available, December 31, 2004, which financial statements described in clauses (a) through (c) shall not be materially inconsistent with the financial statements or forecasts previously provided to the Lenders. Exh. C-2 7. The Lenders shall have received a pro forma consolidated balance sheet of Holdings as of the Closing Date, after giving effect to the Transactions and the other transactions contemplated hereby, which balance sheet shall not be materially inconsistent with the forecasts previously provided to the Lenders. 8. There shall be no litigation, arbitration, administrative proceeding or consent decree that could reasonably be expected to have a material adverse effect on (a) the business, operations, performance, properties, condition (financial or otherwise), prospects or material agreements of or applicable to Holdings and its subsidiaries, taken as a whole, after giving effect to the Transactions and the other transactions contemplated hereby, or (b) the ability of the parties to consummate the Transactions or the other transactions contemplated hereby. 9. The Lenders shall be reasonably satisfied in all respects with any tax sharing agreements among Holdings and its subsidiaries after giving effect to the Transactions and the other transactions contemplated hereby, and with the plans of Holdings with respect thereto. 10. The Lenders shall have received a solvency certificate from a financial officer of the Borrower, in form and substance reasonably satisfactory to the Administrative Agent, together with such other evidence reasonably requested by the Lenders, confirming the solvency of the Borrower and its subsidiaries on a consolidated basis after giving effect to the Transactions and the other transactions contemplated hereby. 11. The consummation of the Transactions and the other transactions contemplated hereby shall not (a) violate any applicable law, statute, rule or regulation or (b) conflict with, or result in a default or event of default under, any material agreement of Holdings, the Borrower or any of their respective subsidiaries, after giving effect to the Transactions, in each case which could reasonably be expected to have (i) a material adverse effect on the business, operations, assets, liabilities, financial condition or results of operations of Eagle and its subsidiaries, taken as a whole, whether or not covered by insurance, or (ii) a material adverse effect on the ability of the Borrower to perform its obligations under the Facilities. 12. (a) After giving effect to the Transactions, Holdings's and Borrower's respective ratios of total indebtedness to Pro Forma Adjusted EBITDA (such pro formas to be done in accordance with Regulation S-X and, as adjusted, in a manner consistent with EBITDA, as adjusted, in Eagle's most recent public filings prior to the date of this letter) for the most recent period of four fiscal quarters ending at least 40 days prior to the Closing Date shall not exceed 6.10 to 1.00 and 5.50 to 1.00, respectively (or 5.80 to 1.00 and 5.20 to 1.00, respectively, if the SemperCare Acquisition Condition shall not have been satisfied on or prior to the Closing Date), and (b) Holdings's Pro Forma Adjusted EBITDA for the most recent period of four fiscal quarters ending at least 40 days prior to the Closing Date shall be greater than $264,000,000 (or $259,000,000 if Exh. C-3 the SemperCare Acquisition Condition shall not have been satisfied on or prior to the Closing Date). 13. All requisite material governmental authorities and third parties shall have approved or consented to the Transactions and the other transactions contemplated hereby to the extent required, all applicable waiting or appeal periods (including any extensions thereof) shall have expired and there shall be no governmental or judicial action, actual or threatened, that could reasonably be expected to restrain, prevent or impose materially burdensome conditions on the Transactions or the other transactions contemplated hereby. 14. The Senior Facilities and the Senior Subordinated Notes shall have been rated by Standard & Poor's Ratings Services ("S&P") and by Moody's Investors Service, Inc. ("Moody's") no later than 45 days prior to the Closing Date. Exh. C-4 EX-99 4 exhi_12202004select.txt EXHIBIT I -- AGREEMENT EXHIBIT I --------- AGREEMENT AGREEMENT, dated as of December 20, 2004 (this "Agreement"), by and among EGL HOLDING COMPANY, a Delaware corporation ("Parent"), and the several individuals named on Schedule I hereto (each a "Rollover Investor" and collectively, the "Rollover Investors" ). W I T N E S S E T H: WHEREAS, on October 17, 2004, Parent, EGL Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Parent ("Acquisition"), and Select Medical Corporation, a Delaware corporation ("SEM"), entered into an Agreement and Plan of Merger (the "Merger Agreement") pursuant to which, upon the terms and subject to the conditions set forth therein, Acquisition will merge with and into SEM (the "Merger") with SEM continuing as the surviving corporation; WHEREAS, on or prior to the closing of the Merger (the "Closing"), the Certificate of Incorporation of Parent will be amended and restated in substantially the form of Exhibit A hereto (the "Restated Parent Charter"), and pursuant to the Restated Parent Charter, the authorized capital stock of Parent will consist of (i) Participating Preferred Stock, par value $0.001 per share ("Parent Preferred Stock"), and (ii) Common Stock, par value $0.001 per share ("Parent Common Stock"); WHEREAS, each Rollover Investor is the beneficial owner of at least the number of shares of Common Stock, par value $.01 per share, of SEM ("SEM Common Stock"), set forth opposite such Rollover Investor's name on Schedule I hereto under the heading "Rollover Shares" (the "Rollover Shares"); and WHEREAS, each of the Rollover Investors, acting severally and not jointly, is willing to contribute such Rollover Investor's Rollover Shares to Parent in exchange for newly issued shares of Parent Preferred Stock and Parent Common Stock (the "New Parent Shares"), upon the terms and subject to the conditions set forth herein. NOW, THEREFORE, the parties hereto agree as follows: ARTICLE I. AGREEMENTS ---------- SECTION 1.01. Rollover. Prior to the Closing, each Rollover Investor will enter into a stock subscription and exchange agreement with Parent, Welsh, Carson, Anderson & Stowe IX, L.P. and other equity investors selected by Parent, in substantially the form set forth in Exhibit B hereto (the "Stock Subscription Agreement"), and will contribute such Rollover Investor's Rollover Shares to Parent in exchange for New Parent Shares on the terms and conditions set forth in the Stock Subscription Agreement (each such Rollover Investor to be a Schedule III Purchaser (as defined in the Stock Subscription Agreement) thereunder). For purposes of each such exchange of shares of SEM Common Stock for New Parent Shares, the value of the shares of SEM Common Stock contributed by each Rollover Investor to Parent shall be $18.00 per share (i.e., an amount equal to the consideration per share of SEM Common Stock payable in the Merger). SECTION 1.02. Stockholders Agreement and Registration Rights Agreement. As contemplated by the Stock Subscription Agreement, prior to the Closing Date, each Rollover Investor will enter into a stockholders agreement, in substantially the form set forth in Exhibit C hereto, and a registration rights agreement, in substantially the form set forth in Exhibit D hereto, in each case with Parent, Welsh, Carson, Anderson & Stowe IX, L.P. and other equity investors selected by Parent. SECTION 1.03. Employment Agreements and Acknowledgements. (a) At or prior to the Closing, each Rollover Investor also agrees to enter into an amended employment agreement, which amends the terms of such Rollover Investor's existing employment agreement and any other change of control, severance or similar agreement with SEM (each, an "Existing Employment Agreement") to reflect the acknowledgments and agreements set forth in clauses (i) and (ii) of Section 1.03(b) below and such other changes as are reasonably acceptable to such Rollover Investor and Parent. (b) Each Rollover Investor acknowledges and agrees (i) that the Merger and other transactions contemplated by the Merger Agreement will not be treated as a "Change of Control" under the relevant provisions of any Existing Employment Agreement with such Rollover Investor, and (ii) to forgo any change of control or similar payments such Rollover Investor would be entitled to receive under such provisions, if the Merger or other transactions contemplated by the Merger Agreement or this Agreement would have been treated as such a "Change of Control" (including any gross-up or payments for, or to reimburse such Rollover Investor for, excise taxes resulting from such payments or other benefits provided under such an Existing Employment Agreement or otherwise in connection with the Merger and other transactions contemplated by the Merger Agreement or this Agreement). For the avoidance of doubt, it is understood that such provisions shall remain in effect with respect to any future Change of Control as defined therein. SECTION 1.04. Restrictions on Transfers. Each Rollover Investor agrees that, without the prior written consent of Parent, it will not make any transfer, sale, assignment, pledge, hypothecation or other disposition (including by operation of law), whether directly or indirectly pursuant to the creation of a derivative security, the grant of an option or other right or the imposition of a restriction on disposition or voting (in each case, a "Transfer"), of any of its Rollover Shares. ARTICLE II. REPRESENTATION AND WARRANTIES SECTION 2.01. Parent Representations. Parent represents and warrants to each Rollover Investor that: 2 (a) Existence. Parent is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware. (b) Authorization; Power; Validity. The execution and delivery by Parent of this Agreement and the consummation of the transactions contemplated hereby are within Parent's powers and have been duly authorized by all necessary corporate action. This Agreement has been duly executed and delivered by Parent. This Agreement constitutes a valid and binding agreement of Parent, enforceable against Parent in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors' rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies. SECTION 3.02. Rollover Investor Representations. Each Rollover Investor, severally and not jointly, and solely with respect to such Rollover Investor, represents and warrants to Parent that: (a) Validity. This Agreement has been duly executed and delivered by such Rollover Investor. This Agreement constitutes a valid and binding agreement of such Rollover Investor, enforceable against such Rollover Investor in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors' rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies. (b) Title to Rollover Shares. Such Rollover Investor has good and valid title to the Rollover Shares to be contributed to Parent pursuant to Section 1.01, free and clear of all claims, liens and encumbrances. ARTICLE III. MISCELLANEOUS ------------- SECTION 3.01. Condition Precedent. For purposes of Section 203 of the Delaware General Corporation Law, this Agreement, including the Exhibits hereto, and the respective obligations of each of the parties hereto is subject to the approval of the Board of Directors of SEM, upon the recommendation of the Special Committee (as defined in the Merger Agreement), and upon such approval this Agreement shall thereafter be binding on the parties. SECTION 3.02. Termination. This Agreement shall be terminated, and the transactions contemplated hereby abandoned at any time prior to the consummation of the Merger, upon the Merger Agreement being terminated in accordance with its terms. If this Agreement is terminated as permitted by this Section 3.02, such termination shall be without liability of any party (or any stockholder, subsidiary, general partner, limited partner, member, director, officer, trustee, employee, agent, consultant or representative of such party) to any of 3 the other parties to this Agreement and this Agreement shall become void and of no further force or effect. SECTION 3.03. Notices. Any notice or communication required or permitted hereunder shall be in writing and shall be delivered personally, delivered by nationally recognized overnight courier service for next day delivery, sent by certified or registered mail, postage prepaid, or sent by facsimile (subject to electronic confirmation of such facsimile transmission). Any such notice or communication shall be deemed to have been given (i) when delivered, if personally delivered, (ii) one business day after it is deposited with a nationally recognized overnight courier service, if sent by nationally recognized overnight courier service, (iii) the day of sending, if sent by facsimile prior to 5:00 p.m. (EST) on any business day or the next succeeding business day if sent by facsimile after 5:00 p.m. (EST) on any business day or on any day other than a business day or (iv) five business days after the date of mailing, if mailed by certified or registered mail, postage prepaid, in each case, to the following address or facsimile number, or to such other addressee, address or facsimile number as such party may subsequently designate to the other parties by notice given hereunder: if to Parent, to it at: EGL Holding Company c/o Welsh, Carson, Anderson & Stowe IX, L.P. 320 Park Avenue, Suite 2500 New York, New York 10022 Attention: Sean M. Traynor Facsimile: (212) 893-9583 and with an additional copy to: Ropes & Gray LLP 45 Rockefeller Plaza New York, New York 10111 Attention: Othon A. Prounis, Esq. Facsimile: (212) 841-5725 if to any Rollover Investor, to such Rollover Investor at the address set forth for such Rollover Investor on Schedule I hereto. SECTION 3.04. Amendments and Waivers. Any provision of this Agreement (or any Schedule or Exhibit to this Agreement) may be amended or waived if, but only if, such amendment or waiver is in writing and, in the case of an amendment, signed by (i) Parent and (ii) a majority-in-interest of the Rollover Investors (determined by reference to the number of Rollover Shares to be contributed to Parent hereunder) or, in the case of a waiver, signed by the party against whom the waiver is to be effective. Notwithstanding the foregoing, Schedule I hereto can be amended by a written instrument signed only by Parent and each Rollover Investor affected thereby and the Exhibits to this Agreement can be amended by a written instrument signed only by Parent so long as such amendment treats all Schedule I Purchasers, Schedule II Purchasers, Schedule III Purchasers and Schedule IV Purchasers (each, as defined in the 4 Subscription Agreement) equally or does not adversely affect any of Schedule III Purchasers (as defined in the Stock Subscription Agreement). No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. SECTION 3.05. Expenses. Except as may otherwise be agreed in writing by Parent, all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such cost or expense. SECTION 3.06. Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. No party hereto shall assign this Agreement or any of its rights, interests or obligations hereunder without the prior written consent of Parent and any purported assignment without such consent shall be invalid and of no effect. SECTION 3.07. Governing Law. This Agreement, and all claims arising hereunder or relating hereto, shall be governed and construed and enforced in accordance with the laws of the State of New York without giving effect to its conflicts of laws principles. SECTION 3.08. Jurisdiction. The parties hereto agree that any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby or thereby may only be brought in the United States District Court for the Southern District of New York or any New York State court sitting in New York County, New York, and each of the parties hereby consents to the exclusive jurisdiction of such courts in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding which is brought in any such court has been brought in an inconvenient forum. Process in any such suit, action or proceeding may be served on any party anywhere in the world, and each party agrees that, in addition to any method of service of process otherwise permitted by law, service of process on each party may be made by any method for giving such party notice as provided in Section 3.03, and shall be deemed effective service of process on such party. SECTION 3.09. Waiver Of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. SECTION 3.10. Specific Performance. The parties hereto acknowledge and agree that any breach or threatened breach of the terms of this Agreement would give rise to irreparable harm for which money damages would not be an adequate remedy and accordingly the parties agree that, in addition to any other remedies, each party shall be entitled to enforce the terms of this Agreement by a decree of specific performance without the necessity of proving the inadequacy of money damages as a remedy. 5 SECTION 3.11. Entire Agreement. This Agreement, including the Schedules and Exhibits hereto, constitutes the entire agreement, arrangement and understanding of the parties hereto with respect to the subject matter hereof, including without limitation all arrangements among the parties relating to the shares of SEM Common Stock held by each Rollover Investor, and there are no other agreements, arrangements or understandings among the parties hereto with respect to the subject matter hereof. SECTION 3.12. Counterparts; Third Party Beneficiaries. This Agreement may be executed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. No provision of this Agreement shall confer upon any person other than the parties hereto any rights or remedies hereunder. [SIGNATURE PAGES FOLLOW] 6 IN WITNESS WHEREOF, each of the parties hereto has duly executed and delivered this Agreement as of the day and year first above written. PARENT: EGL HOLDING COMPANY By: /s/ Sean M. Traynor -------------------------------- Name: Sean M. Traynor Title: President ROLLOVER INVESTORS: /s/ Patricia A. Rice -------------------------------------- Patricia A. Rice /s/ S. Frank Fritsch -------------------------------------- S. Frank Fritsch /s/ Michael E. Tarvin -------------------------------------- Michael E. Tarvin /s/ James J. Talalai -------------------------------------- James J. Talalai /s/ Scott A. Romberger -------------------------------------- Scott A. Romberger -----END PRIVACY-ENHANCED MESSAGE-----