FIRST AMENDMENT TO CREDIT AGREEMENT ------------------------------------ FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment"), dated as of August 12, 1997, among Three Rivers Holding Corp. ("Holdings"), a Delaware corporation, Three Rivers Acquisition Corp. ("Acquisition Corp."), a Delaware corporation, SMT Health Services Inc. ("SMT"), a Delaware corporation, (Acquisition Corp. and SMT each a "Borrower" and, collectively, "the Borrowers"), the lender party to the Credit Agreement referred to below on the date hereof and immediately before giving effect to this Amendment (the "Existing Bank"), BANKERS TRUST COMPANY, as Agent (the "Agent") for the Banks and each of the banks listed on Schedule A hereto (each, a "New Bank" and, collectively, the "New Banks"). All capitalized terms used herein and not otherwise defined herein shall have the respective meanings provided such terms in the Credit Agreement referred to below. W I T N E S S E T H : - - - - - - - - - - WHEREAS, Holdings, the Borrowers, the Existing Bank, and the Agent are parties to a Credit Agreement, dated as of August 5, 1997 (the "Credit Agreement"); WHEREAS, the parties hereto wish to amend the Credit Agreement as herein provided; NOW, THEREFORE, it is agreed: 1. The definition of "Scheduled Commitment Reduction Date" appearing in Section 3.03(c) is hereby amended by (i) deleting the text "August 31, 2002" appearing therein and inserting in lieu thereof the text "August 31, 2001" and (ii) deleting the text "August 31, 2003" appearing therein and inserting in lieu thereof the text "August 31, 2002". 2. The definitions of "Applicable RL Commitment Fee Percentage", "Applicable Excess Cash Flow Percentage" and "Applicable Prepayment Percentage" appearing in Section 11 are hereby amended by inserting the phrase "with respect to Revolving Loans" immediately after the phrase "Interest Reduction Discount then in effect" appearing therein. 3. The definition of "Interest Reduction Discount" appearing in Section 11 is hereby amended by: (i) inserting the phrase "(1) for all purposes of determining interest with respect to Revolving Loans and Swingline Loans," immediately prior to the phrase "(x) zero or (y) the respective percentage per annum set forth in clause (A), (B), (C), (D) or (E) below if," appearing therein; (ii) deleting the period at the end of the first sentence thereof and inserting a semicolon in lieu thereof; (iii) inserting the following text after clause (E) of, and as part of, the first sentence thereof: "or (2) for all purposes of determining interest with respect to Term Loans, (x) zero or (y) the respective percentage per annum set forth in clause (A) or (B) below, if, but only if, as of the Test Date most recently ended prior to such Start Date the conditions in clause (A) or (B) below are met: (A) 1/4 of 1% if, but only if, as of the Test Date for such Start Date, the Leverage Ratio for the Test Period ended on such Test Date shall be less than 4.00:1.00 and the conditions set forth in clause (B) below are not satisfied; or (B) 1/2 of 1% if, but only if, as of the Test Date for such Start Date, the Leverage Ratio for the Test Period ended on such Test Date shall be less than 3.00:1.00."; (iv) deleting the word "clause" appearing in the final sentence of such definition and inserting in lieu thereof the following text: "(x) in the case of Revolving Loans and Swingline Loans, clause (1)"; and (v) inserting the following text immediately at the end of, and as part of, the last sentence of such definition: "or (y) in the case of Term Loans, clause (2)(A) or (B), if any, contained in this definition shall be applicable." 4. The Existing Bank hereby sells and assigns to each of the New Banks without recourse and without representation or warranty (other than as expressly provided herein), and each New Bank hereby purchases and assumes from the Existing Bank, that interest in and to each of the Existing Bank's rights and obligations under the Credit Agreement as of the date hereof which in the aggregate represents such New Bank's pro -2- rata share (for each such New Bank, its "Pro Rata Share") as set forth on, and in respect of the credit facilities listed on, Schedule B hereto (calculated after giving effect to this Amendment), and such Pro Rata Share represents all of the outstanding rights and obligations under the Credit Agreement that are being sold and assigned to each New Bank, including, without limitation, (x) in the case of any assignment of all or any portion of the Total Term Loan Commitment, all rights and obligations with respect to such New Bank's Pro Rata Share of such Total Term Loan Commitment, including all such rights and obligations with respect to such New Bank's Pro Rata Share of outstanding Term Loans, and (y) in the case of any assignment of all or any portion of the Total Revolving Loan Commitment, all rights and obligations with respect to such New Bank's Pro Rata Share of such Total Revolving Loan Commitment, including all such rights and obligations with respect to such New Bank's Pro Rata Share of outstanding Revolving Loans, Swingline Loans and Letters of Credit. After giving effect to this Amendment, the Existing Bank's and New Banks' Term Loan Commitment, outstanding Term Loans and Revolving Loan Commitment will be as set forth on Schedule C hereto. 5. In accordance with the requirements of Section 13.04(b) of the Credit Agreement, on the First Amendment Effective Date (as defined below), (i) the Credit Agreement shall be amended by deleting Schedule I thereto in its entirety and by inserting in lieu thereof a new Schedule I in the form of Schedule C hereto and (ii) each Borrower agrees that it will issue an appropriate Term Note and/or Revolving Note, as the case may be, to each Bank in conformity with the requirements of Section 1.05 of the Credit Agreement. 6. On and after the First Amendment Effective Date, Schedule II to the Credit Agreement shall be amended by deleting Schedule II in its entirety and inserting in lieu thereof a new Schedule II in the form of Schedule D hereto. 7. The Existing Bank (i) represents and warrants that it is the legal and beneficial owner of the interest being assigned by it hereunder and that such interest is free and clear of any adverse claim; (ii) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Credit Agreement or the other Credit Documents or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement or the other Credit Documents or any other instrument or document furnished pursuant thereto; and (iii) makes no representation or warranty and assumes no responsibility with respect to the financial condition of Holdings, the Borrowers or any of their respective Subsidiaries or the performance or observance by Holdings, the Borrowers or any of their respective Subsidiaries of any of their respective obligations under the Credit Agreement or the other Credit Documents to which they are a party or any other instrument or document furnished pursuant thereto. -3- 8. Each New Bank (i) confirms that it has received a copy of the Credit Agreement and the other Credit Documents, together with copies of the financial statements referred to therein and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Amendment; (ii) agrees that it will, independently and without reliance upon the Agent or any other Bank and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement; (iii) confirms that it is an Eligible Transferee under Section 13.04(b) of the Credit Agreement; (iv) appoints and authorizes the Agent to take such action as agent on its behalf and to exercise such powers under the Credit Agreement and the other Credit Documents as are delegated to the Agent by the terms thereof, together with such powers as are reasonably incidental thereto; (v) agrees that it will perform in accordance with their terms all of the obligations which by the terms of the Credit Agreement are required to be performed by it as a Bank; and (vi) to the extent relevant, agrees to promptly submit to the Borrowers and the Agent the appropriate Internal Revenue Service Forms described in Section 13.04(b) of the Credit Agreement. 9. The Existing Bank, the New Banks and the Agent hereby agree that all amounts accrued with respect to the Commitments, the Loans or the Letters of Credit prior to the delivery by such New Bank of the amount referred to in clause (ii) of Section 15 of this Amendment, shall be for the account of the Existing Bank and that all such amounts accrued after the delivery of such amounts referred to in clause (ii) of such Section 15 shall be for the account of such New Bank based upon its Pro Rata Share. 10. In accordance with Section 13.04(b) of the Credit Agreement, on and as of the date upon which each New Bank delivers the amount referred to in clause (ii) of Section 15 of this Amendment, such New Bank shall become a "Bank" under, and for all purposes of, the Credit Agreement and the other Credit Documents and, notwithstanding anything to the contrary in Section 13.17 of the Credit Agreement, the Agent shall record the transfers contemplated hereby in the Register. 11. This Amendment is limited as specified and shall not constitute a modification, acceptance or waiver of any other provision of the Credit Agreement or any other Credit Document. 12. This Amendment may be executed in any number of counterparts and by the different parties hereto on separate counterparts, each of which counterparts when executed and delivered shall be an original, but all of which shall together constitute one and the same instrument. A complete set of counterparts shall be lodged with the Borrower and the Agent. -4- 13. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. 14. Subject to Section 15 of this Amendment, this Amendment shall become effective on the date (the "First Amendment Effective Date") when (i) Holdings, each Borrower, the Agent, the Existing Bank and each New Bank shall have signed a counterpart hereof (whether the same or different counterparts) and shall have delivered (including by way of facsimile transmission) the same to the Agent at its Notice Office and (ii) each New Bank shall have delivered to the Agent for the account of the Existing Bank, an amount equal to such New Bank's Pro Rata Share of the principal amount of the outstanding Loans. 15. Notwithstanding Section 14 of this Amendment, if for any reason any New Bank shall not have (i) signed a counterpart hereof and delivered the same to the Agent at its Notice Office and (ii) delivered to the Agent an amount equal to such New Bank's Pro Rata Share of the principal amount of the outstanding Loans, in each case on or prior to August 12, 1997, then, if the Existing Bank agrees, this Amendment shall become effective notwithstanding such failure, provided that (x) Schedules A, B, C and D shall be modified to delete -------- any such New Bank and such New Bank's Pro Rata Share shall be retained by the Existing Bank and (y) the signature pages of this Amendment shall be deemed revised to delete such New Bank's name therefrom. 16. From and after the First Amendment Effective Date, all references in the Credit Agreement and each of the other Credit Documents to the Credit Agreement shall be deemed to be references to the Credit Agreement as amended hereby. * * * -5- IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Amendment to be duly executed and delivered as of the date first above written. THREE RIVERS HOLDING CORP. By_________________________________________________ Name: Title: THREE RIVERS ACQUISITION CORP. By_________________________________________________ Name: Title: SMT HEALTH SERVICES INC. By_________________________________________________ Name: Title: BANKERS TRUST COMPANY, Individually and as Agent By_________________________________________________ Name: Title: SALOMON BROTHERS HOLDING COMPANY INC By_________________________________________________ Name: Title: LASALLE NATIONAL BANK By_________________________________________________ Name: Title: PILGRIM AMERICA PRIME RATE TRUST By_________________________________________________ Name: Title: PRIME INCOME TRUST By_________________________________________________ Name: Title: VAN KAMPEN AMERICAN CAPITAL PRIME RATE INCOME TRUST By_________________________________________________ Name: Title: THE ING HIGH INCOME PRINCIPAL PRESERVATION OFFERING, L.P. By_________________________________________________ Name: Title: SCHEDULE A to First Amendment --------------- NEW BANKS --------- SALOMON BROTHERS HOLDING COMPANY INC LASALLE NATIONAL BANK PILGRIM AMERICA PRIME RATE TRUST PRIME INCOME TRUST VAN KAMPEN AMERICAN CAPITAL PRIME RATE INCOME TRUST THE ING HIGH INCOME PRINCIPAL PRESERVATION OFFERING, L.P. SCHEDULE B to First Amendment --------------- PRO RATA SHARE -------------- ================================================================================ Bank Total Term Loan Total Revolving Loan Commitment and Commitment and Outstanding Term Outstanding Revolving Loans Loans - -------------------------------------------------------------------------------- Bankers Trust Company 24% 33.3333% - -------------------------------------------------------------------------------- Salomon Brothers 0% 33.3333% Holding Company Inc - -------------------------------------------------------------------------------- LaSalle National Bank 0% 33.3333% - -------------------------------------------------------------------------------- Pilgrim America Prime 20% 0% Rate Trust - -------------------------------------------------------------------------------- Prime Income Trust 20% 0% - -------------------------------------------------------------------------------- Van Kampen American 16% 0% Capital Prime Rate Income Trust - -------------------------------------------------------------------------------- The ING High Income 20% 0% Principal Preservation Offering, L.P. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- TOTAL 100% 100% ================================================================================ SCHEDULE C to First Amendment --------------- COMMITMENTS ----------- ================================================================================ Bank Term Loan Outstanding Revolving Loan Commitment Term Loans Commitment - -------------------------------------------------------------------------------- Bankers Trust $ 2,633,852.40 $9,366,147.60 $10,000,000 Company - -------------------------------------------------------------------------------- Salomon Brothers 0 0 $10,000,000 Holding Company Inc - -------------------------------------------------------------------------------- LaSalle National 0 0 $10,000,000 Bank - -------------------------------------------------------------------------------- Pilgrim America $ 2,194,877.00 $ 7,805,123 0 Prime Rate Trust - -------------------------------------------------------------------------------- Prime Income $ 2,194,877.00 $ 7,805,123 0 Trust - -------------------------------------------------------------------------------- Van Kampen $ 1,755,901.60 $6,244,098.40 0 American Capital Prime Rate Income Trust - -------------------------------------------------------------------------------- The ING High $ 2,194,877.00 $ 7,805,123 0 Income Principal Preservation Offering, L.P. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Total $10,974,385.00 $ 39,025,615 $30,000,000 ================================================================================ SCHEDULE D to First Amendment --------------- Bankers Trust Company 130 Liberty Street New York, NY 10006 Contact: Gregory Shefrin Tel: 212-250-1724 Fax: 212-250-7218 Salomon Brothers Holding Company Inc Seven World Trade Center 32nd Floor New York, NY 10048 Contact: Townsend U. Weekes, Jr. Tel: 212-783-7628 Fax: 212-783-2823 LaSalle National Bank 135 South LaSalle Street Suite 242 Chicago, IL 60674 Contact: Ward Nixon Tel: 312-904-8339 Fax: 312-904-4779 Pilgrim America Prime Rate Trust Two Renaissance Square 40 North Central Avenue Suite 1200 Phoenix, AZ 85004 Contact: Howard Tiffen Tel: 602-417-8259 Fax: 602-417-8327 Prime Income Trust c/o Dean Witter Intercapital, Inc. 72nd Floor Two World Trade Center New York, NY 10048 Contact: Louis Pistecchia Tel: 212-392-5845 Fax: 212-392-5345 Van Kampen American Capital Prime Rate Income Trust One Parkview Plaza Oakbrook Terrace, IL 60181 Contact: Jeffrey Maillet Tel: 630-684-6438 Fax: 630-684-6740 The ING High Income Principal Preservation Offering, L.P. 333 S. Grand Avenue, Suite 4250 Los Angeles, CA 90071 Contact: Kathleen Lenarcic Tel: 213-346-3971 Fax: 213-346-3995 -2-