EXHIBIT 10.9
PARENT GUARANTY
THIS PARENT GUARANTY ("Guaranty"), is entered into as of
December 10, 2001, by ADVANCEPCS, a Delaware corporation (the "Parent"), in
favor of ADVANCEPCS HEALTH, L.P., a Delaware limited partnership (the
"Originator"), AFC RECEIVABLES HOLDING CORPORATION, a Delaware corporation
("Holding" or the "Receivables Seller"), Advance funding corporation, a Delaware
corporation ("AFC" or the "Seller"), and ADVP MANAGEMENT, L.P., a Delaware
limited partnership (together with its successors and assigns, the "Servicer"),
(the Originator, Holding, AFC and the Servicer, together with their respective
successors and assigns are collectively referred to herein as the "Recipients").
RECITALS
A. The Parent, the Originator, Holding and the Servicer have
entered into a Receivables Purchase and Contribution Agreement, dated as of
December 10, 2001 (as the same may be amended, restated, supplemented or
otherwise modified, the "Contribution Agreement"), pursuant to which the
Originator, subject to the terms and conditions contained therein, is selling
and/or contributing its respective right, title and interest in certain
Receivables to Holding, and the Servicer has agreed to service, administer and
collect such Receivables;
B. The Receivables Seller, AFC and the Servicer have entered
into a Receivables Sale and Contribution Agreement, dated as of December 10,
2001 (as the same may be amended, restated, supplemented or otherwise modified,
the "Sale Agreement"); pursuant to which Holding, subject to the terms and
conditions contained therein, is selling and/or contributing its respective
right, title and interest in the Transferred Receivables to AFC, and the
Servicer has agreed to service, administer and collect the Transferred
Receivables;
C. The Seller, the Servicer, Redwood Receivables Corporation,
a Delaware corporation ("Redwood" or the "Conduit Purchaser") and General
Electric Capital Corporation, a Delaware corporation ("GECC" or the "Committed
Purchaser" and, in its capacity as administrative agent, the "Administrative
Agent"), have entered into a Receivables Purchase and Servicing Agreement, dated
as of December 10, 2001 (as the same may be amended, restated, supplemented or
otherwise modified, the "Purchase Agreement") pursuant to which AFC, subject to
the terms and conditions contained therein, is selling undivided percentage
interests in the Transferred Receivables to the Purchasers, and the Servicer has
agreed to service, administer and collect the Transferred Receivables acquired
by the Purchasers.
The Contribution Agreement, the Sale Agreement and the Purchase
Agreement are collectively referred to herein as the "Agreements". The
Originator, the Receivables Seller and the Seller (each a "Selling Subsidiary")
are collectively referred to herein as the "Selling Subsidiaries".
Unless otherwise defined herein, capitalized terms or matters of
construction defined or established in the Agreements shall be applied herein as
defined or established therein.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants herein contained and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, and in order to
induce (i) Holding to make purchases under the Contribution Agreement, (ii) AFC
to make purchases under the Sale Agreement and (iii) the Servicer to perform its
obligations under the Agreements, the Parent hereby agrees as follows:
1. Unconditional Undertaking. The Parent hereby
unconditionally and irrevocably undertakes and agrees with and for the benefit
of the Recipients to cause the due and punctual performance and observance by
each Selling Subsidiary and the Servicer and each of their respective successors
and assigns of all of the terms, covenants, conditions, agreements and
undertakings on the part of such Selling Subsidiary and the Servicer to be
performed or observed under the Agreements or any document delivered by such
Selling Subsidiary or the Servicer in connection with such agreement in
accordance with the terms thereof, including the punctual payment when due of
all obligations of such Selling Subsidiary and the Servicer now or hereafter
existing under the Agreements, whether for indemnification payments, fees,
expenses or otherwise (such terms, covenants, conditions, agreements,
undertakings and other obligations being the "Obligations"), and agrees to pay
any and all reasonable and documented expenses (including reasonable and
documented fees and expenses of attorneys, auditors and accountants) incurred by
any of the Recipients in enforcing any rights under this Guaranty; provided,
that the foregoing unconditional undertaking of the Parent is not intended to,
and shall not, constitute a guarantee of the collectibility or payment of the
Receivables. The Parent agrees that each of its Subsidiaries that becomes an
"Originator" under the Contribution Agreement shall be deemed to be a "Selling
Subsidiary" for purposes of this Guaranty and each of its Subsidiaries that
becomes a "Servicer" under any of the Agreements shall be deemed to be a
"Servicer" for purposes of this Guaranty. In the event that any Selling
Subsidiary or the Servicer shall fail in any manner whatsoever to perform or
observe any of its Obligations when the same shall be required to be performed
or observed under any of the Agreements or any such other document, then the
Parent will itself duly and punctually perform or observe, or cause to be duly
and punctually performed or observed, such Obligations, and, except to the
extent required under such Agreement, it shall not be a condition to the accrual
of the obligation of the Parent hereunder to perform or observe any Obligation
(or to cause the same to be performed or observed) that any Recipient shall have
first made any request of or demand upon or given any notice to the Parent, to
any Selling Subsidiary, or to the Servicer, or any of their respective
successors or assigns, or have instituted any action or proceeding against the
Parent, any Selling Subsidiary, the Servicer or their respective successors or
assigns in respect thereof.
2. Obligation Absolute. The Parent undertakes that the
Obligations will be performed or paid strictly in accordance with the terms of
the respective Agreement or any other document delivered by a Selling Subsidiary
or the Servicer in connection with any of the Agreements, regardless of any law,
regulation or order applicable to any Recipient now or hereafter in effect in
any jurisdiction affecting any of such terms or the rights of such Recipient
with respect thereto. The obligations of the Parent under this Guaranty are
independent of the Obligations, and a separate action or actions may be brought
and prosecuted against the Parent to enforce this Guaranty, irrespective of
whether any action is brought against any Selling Subsidiary or the Servicer or
whether any Selling Subsidiary or the Servicer is joined in any such action or
actions. The liability of the Parent under this Guaranty shall be absolute and
unconditional irrespective of:
(a) any lack of validity or enforceability of any of
the Agreements or any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of
payment of, or in any other term of, all or any of the Obligations, or
any other amendment or waiver of or any consent to departure from any
of the Agreements or any other agreement or instrument relating
thereto, including, without limitation, any increase in the Obligations
resulting from additional purchases or contributions of Receivables or
otherwise;
(c) any taking, exchange, release or non-perfection
of any collateral, or any taking, release or amendment or waiver of or
consent to departure from any guaranty, for all or any of the
Obligations;
(d) any manner of application of collateral, or
proceeds thereof, to all or any of the Obligations, or any manner of
sale or other disposition of any collateral for all or any of the
Obligations or any other assets of any Selling Subsidiary or the
Servicer or any of their respective subsidiaries; or
(e) any change, restructuring or termination of the
corporate structure or existence of any Selling Subsidiary or the
Servicer or any of their respective subsidiaries.
This Guaranty shall continue to be effective or be reinstated, as the
case may be, if at any time any payment of any of the Obligations is rescinded
or must otherwise be returned by any Recipient upon the insolvency, bankruptcy
or reorganization of any Selling Subsidiary or the Servicer or otherwise, all as
though payment had not been made.
3. Waivers. The Parent hereby waives promptness, diligence,
notice of acceptance and, except to the extent required under any of the
Agreements, any other notice with respect to any of the Obligations and this
Guaranty and any requirement that any Recipient protect, secure, perfect or
insure any Lien or any property subject thereto or exhaust any right or take any
action against any Selling Subsidiary, the Servicer or any other person or
entity or any collateral.
4. Subrogation. The Parent agrees not to exercise any rights
that it may acquire by way of subrogation against any Selling Subsidiary and its
property or the Servicer and its property or any rights of indemnification,
contribution and reimbursement from any Selling Subsidiary and its property or
the Servicer and its property, in each case in connection with this
Guaranty and any payments made hereunder, until such time as the Obligations
have been paid and performed in full and the Termination Date has occurred.
5. Amendments and Waivers. No amendment or waiver of any
provision of this Guaranty, and no consent to any departure by the Parent
herefrom, shall in any event be effective unless the same shall be in writing
and signed by the Recipients, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
6. Addresses for Notices. All notices and other communications
hereunder shall be sent in the manner provided in Section 8.1 of the
Contribution Agreement, Section 8.1 of the Sale Agreement and Section 14.1 of
the Purchase Agreement, which provisions are incorporated herein by this
reference as though fully set forth herein.
7. No Waiver; Remedies. No failure on the part of any
Recipient to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
8. Continuing Agreement; Assignments under Transfer Agreement.
This Guaranty is a continuing agreement and shall (a) remain in full force and
effect until the Termination Date has occurred and the payment and performance
in full of the Obligations and the payment of all other amounts payable under
this Guaranty, (b) be binding upon the Parent, its successors and assigns, and
(c) inure to the benefit of, and be enforceable by, each of the Recipients and
its respective successors, transferees and assigns. Without limiting the
generality of the foregoing clause (c), if either of Holding or AFC assigns all
or any of the Receivables, or any interest therein, the assignees shall
thereupon become vested with all the benefits in respect thereof granted to
Holding or AFC, as applicable, herein or otherwise.
9. Severability. Wherever possible, each provision of this
Guaranty shall be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Guaranty shall be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity without invalidating the remainder
of such provision or the remaining provisions of this Guaranty.
10. GOVERNING LAW. THIS GUARANTY AND THE OBLIGATIONS ARISING
HEREUNDER SHALL IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY
AND PERFORMANCE, BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE CONFLICT OF
LAW PROVISIONS THEREOF) AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA.
IN WITNESS WHEREOF, the Parent has caused this Guaranty to be
duly executed and delivered by its officer thereunto duly authorized as of the
date first above written.
ADVANCEPCS
By:
-----------------------------
Name:
Title:
