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EXHIBIT 10.3
GUARANTY
This Guaranty dated as of March 31, 1999 ("Guaranty") is by each
Subsidiary of the Borrower (as defined below) listed on the signature page
(each a "Guarantor" and collectively the "Guarantors"), in favor of the Agent
for the Banks referred to below.
INTRODUCTION
A. This Guaranty is given in connection with the Credit Agreement
dated as of March 31, 1999 (as the same may be amended or modified from
time-to-time, the "Credit Agreement") among Advance Paradigm, Inc., a Delaware
corporation ("Borrower"), the Banks, and NationsBank, N.A., as agent for the
Banks ("Agent").
B. The Borrower is the principal financing entity for all capital
requirements of its Subsidiaries, and from time-to-time the Borrower has made
capital contributions and advances to its Subsidiaries, including each of the
Guarantors. Each Guarantor is a wholly-owned subsidiary of the Borrower and
will derive substantial direct and indirect benefit from the transactions
contemplated by the Credit Agreement.
C. Under the Credit Agreement, it is a condition to the making of the
Advances by the Banks, the issuance of the Letters of Credit by the Issuing
Bank, and the making of Swing Loans by the Agent that each of the Guarantors
shall have executed and delivered this Guaranty.
Therefore, in order to induce the Banks to make the Advances, the
Issuing Bank to issue Letters of Credit and the Agent to make Swing Loans, each
of the Guarantors hereby agrees with Agent for its benefit and the ratable
benefit of the Banks as follows:
Section 1. Definitions. Unless otherwise defined, capitalized terms are defined
in the Credit Agreement.
Section 2. Guaranty. Each Guarantor hereby unconditionally guarantees the
punctual payment when due, whether at stated maturity, by acceleration or
otherwise, of all obligations of the Borrower now or hereafter existing under
the Credit Agreement, the Notes, the Swing Notes and any other Credit Document,
whether for principal, Reimbursement Obligations, obligations under any
Derivatives executed with a Bank or an Affiliate of a Bank, interest, fees,
expenses, or otherwise (such obligations being the "Guaranteed Obligations"),
and any and all expenses (including reasonable counsel fees and expenses)
incurred by the Agent, the Issuing Bank, or any Bank in enforcing any rights
under this Guaranty. Each Guarantor agrees that this Guaranty is a guarantee of
payment, not of collection and that each Guarantor is primarily liable for the
payment of the Guaranteed Obligations.
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Section 3. Limit of Liability. The obligations of the each Guarantor hereunder
shall be limited to an aggregate amount equal to the largest amount that would
not render its obligations hereunder subject to avoidance under Section 548 of
the United States Bankruptcy Code or any comparable provisions of any
applicable state law.
Section 4. Guaranty Absolute. Each Guarantor guarantees that the Guaranteed
Obligations will be paid strictly in accordance with the terms of the Credit
Agreement and the other Credit Documents, regardless of any law, regulation, or
order now or hereafter in effect in any jurisdiction affecting any of such
terms or the rights of the Agent, the Issuing Bank, or the Banks with respect
thereto. The liability of each Guarantor under this Guaranty shall be absolute
and unconditional irrespective of:
(a) any lack of validity or enforceability of the Credit
Agreement, any other Credit Document, 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, any of the Guaranteed Obligations, any increase,
reduction, extension, or rearrangement of the Guaranteed Obligations, or any
other amendment or waiver of or any consent to departure from the Credit
Agreement or any Credit Document;
(c) any exchange, release, or nonperfection of any
collateral, or any release or amendment or waiver of or consent to departure
from any other Guaranty, for any of the Guaranteed Obligations; or
(d) any other circumstances which might otherwise constitute
a defense available to, or a discharge of the Borrower or a Guarantor.
Section 5. Certain Waivers.
5.01. Notice. Each Guarantor hereby waives promptness, diligence,
notice of acceptance, notice of acceleration, notice of intent to accelerate,
and any other notice with respect to any of the Guaranteed Obligations and this
Guaranty.
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5.02. Other Remedies. Each Guarantor hereby waives any requirement
that the Agent, the Issuing Bank, or any Bank protect, secure, perfect, or
insure any Lien or any Property subject thereto or exhaust any right or take
any action against the Borrower or any other Person or any collateral.
5.03. Subrogation. (a) Until the irrevocable payment in full of the
Guaranteed Obligations, none of the Guarantors will take any action pursuant to
any claim or rights which it may acquire against the Borrower or any other
Guarantor that arise from each Guarantor's obligations under this Guaranty or
any other Credit Document, including, without limitation, any right of
subrogation (including, without limitation, any statutory rights of subrogation
under Section 509 of the Bankruptcy Code, 11 U.S.C. Section 509, or otherwise),
reimbursement, exoneration, contribution, indemnification or any right to
participate in any claim or remedy of the Agent, the Issuing Bank, or any Bank
against the Borrower or any collateral, if any, which the Agent, the Issuing
Bank, or any Bank now has or acquires. If any amount shall be paid to any
Guarantor in violation of the preceding sentence and the Guaranteed Obligations
shall not have been paid in full, such amount shall be held in trust for the
benefit of the Agent, the Issuing Bank, and the Banks, and shall promptly be
paid to the Agent for the benefit of the Agent, the Issuing Bank, and the Banks
to be applied to the Guaranteed Obligations, whether matured or unmatured, as
the Agent may elect. Each Guarantor acknowledges that it will receive direct
and indirect benefits from the financing arrangements contemplated by the
Credit Agreement and that the waiver set forth in this Section 5.03(a) is
knowingly made in contemplation of such benefits.
(b) Each Guarantor agrees that, to the extent that any
Borrower makes payments to the Agent, the Issuing Bank, or any Bank, or the
Agent, the Issuing Bank, or any Bank receives any proceeds of collateral, and
such payments or proceeds or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside, or otherwise required to
be repaid, then to the extent of such repayment the Guaranteed Obligations
shall be reinstated and continued in full force and effect as of the date such
initial payment or collection of proceeds occurred. EACH GUARANTOR SHALL DEFEND
AND INDEMNIFY THE AGENT, THE ISSUING BANK, AND EACH BANK (EACH AN "INDEMNIFIED
PARTY") FROM AND AGAINST ANY CLAIM OR LOSS UNDER THIS SUBSECTION 5.03(b)
(INCLUDING REASONABLE ATTORNEYS' FEES AND EXPENSES) IN THE DEFENSE OF ANY SUCH
ACTION OR SUIT, INCLUDING LOSSES, LIABILITIES, CLAIMS, DAMAGES, OR EXPENSES
INCURRED BY REASON OF NEGLIGENCE OF THE PERSON TO BE INDEMNIFIED, BUT EXCLUDING
ANY SUCH LOSSES, LIABILITIES, CLAIMS,
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DAMAGES, OR EXPENSES (A) INCURRED BY REASON OF THE GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT OF AN INDEMNIFIED PARTY OR (B) ASSERTED BY AN INDEMNIFIED PARTY OR A
STOCKHOLDER OR AFFILIATE THEREOF AGAINST AN INDEMNIFIED PARTY.
Section 6. Representations and Warranties. Each Guarantor hereby represents and
warrants as follows:
(a) Corporate Authority. Each Guarantor is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization. The execution, delivery and performance by each Guarantor of this
Guaranty are within each Guarantor's powers, have been duly authorized by all
necessary action, and do not (i) contravene (A) each Guarantor's charter or
bylaws or (B) any law or material contractual restriction affecting each
Guarantor or its Property, the contravention of which would reasonably be
expected to cause a Material Adverse Change, or (ii) result in or require the
creation or imposition of any Lien prohibited by the Credit Agreement.
(b) Government Approval. No authorization or approval or
other action by, and no notice to or filing with, any Governmental Authority is
required for the due execution, delivery, and performance by each of the
Guarantors of this Guaranty.
(c) Binding Obligations. This Guaranty is the legal, valid,
and binding obligation of each Guarantor enforceable against each Guarantor in
accordance with its terms subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium, or similar law affecting creditors'
rights (whether considered in a proceeding at law or in equity).
Section 7. Covenants. Each Guarantor will comply with all provisions of
Articles V and VI of the Credit Agreement to the extent such Sections are
applicable to each Guarantor.
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Section 8. Miscellaneous.
8.01. Amendments, Etc. No amendment or waiver of any provision of this
Guaranty nor consent to any departure by each of the Guarantors therefrom shall
be effective unless the same shall be in writing and signed by the Agent,
Majority Banks and the Borrower, provided that any amendment or waiver
releasing any Guarantor from any liability hereunder shall be signed by all the
Banks and then such waiver or consent shall be effective only in the specific
instance and for the specific purpose for which given.
8.02. Addresses for Notices. All notices and other communications
provided for hereunder shall be in writing, including telegraphic
communication, and delivered or teletransmitted to the addresses set forth next
to the signatures below, or to such other address as shall be designated by
each Guarantor or Agent in written notice to the other party. All such notices
and other communications shall be effective when delivered or teletransmitted
to the above addresses.
8.03. No Waiver; Remedies. No failure on the part of the Agent, the
Issuing Bank, or any Bank 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.
8.04. Right of Set-Off. Upon (a) the occurrence and during the
continuance of any Event of Default and (b) the making of the request or the
granting of the consent, if any, specified by Section 7.02 of the Credit
Agreement to authorize the Agent to declare the Notes, the Swing Notes, and any
other amount payable under the Credit Agreement due and payable pursuant to the
provisions of such Section 7.02 or the automatic acceleration of the Notes, the
Swing Notes, and all amounts payable under the Credit Agreement pursuant to
Section 7.03 thereunder, the Agent, the Issuing Bank, and each Bank is hereby
authorized at any time, to the fullest extent permitted by law, to set off and
apply any deposits (general or special, time or demand, provisional or final,
but excluding deposits that such Bank knows or, with reasonable inquiry should
know, are held by Borrower in a fiduciary capacity for the benefit of others)
and other indebtedness owing by the Agent, the Issuing Bank, or such Bank to
the account of each Guarantor against any and all of the obligations of each
Guarantor under this Guaranty, irrespective of whether or not the Agent, the
Issuing Bank, or such Bank shall have made any demand under this Guaranty and
although such obligations may be contingent and unmatured. The Agent, the
Issuing Bank, and each Bank
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agrees promptly to notify each Guarantor after any such set-off and application
made by the Agent, the Issuing Bank, or such Bank provided that the failure to
give such notice shall not affect the validity of such set-off and application.
The rights of the Agent, the Issuing Bank, and the Banks under this Section
8.04 are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which the Agent, the Issuing Bank, or the
Banks may have.
8.05. Continuing Guaranty; Transfer of Interest. This Guaranty shall
create a continuing guaranty and shall (a) remain in full force and effect
until payment in full and termination of the Guaranteed Obligations, (b) be
binding upon each Guarantor, its successors, and assigns, and (c) inure,
together with the rights and remedies of the Agent hereunder, to the benefit of
the Agent, the Issuing Bank, the Banks, and their respective successors and
Eligible Assignees. Without limiting the generality of the foregoing clause,
when any Bank assigns or otherwise transfers any interest held by it under the
Credit Agreement or other Credit Document to any other Person (pursuant to
Section 9.06 of the Credit Agreement), that other Person shall thereupon become
vested with all the benefits held by such Bank under this Guaranty. Upon the
payment in full and termination of the Guaranteed Obligations, the guaranty
granted hereby shall terminate and all rights hereunder shall revert to each
Guarantor to the extent such rights have not been applied pursuant to the terms
hereof. Upon any such termination, the Agent will, at each Guarantor's expense,
execute and deliver to each Guarantor such documents as such Guarantor shall
reasonably request and take any other actions reasonably requested to evidence
or effect such termination.
8.06. Governing Law. This Guaranty shall be governed by, and construed
and enforced in accordance with, the laws of the State of New York.
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Each of the Guarantors has caused this Guaranty to be duly executed as
of the date first above written.
GUARANTORS:
INNOVATIVE MEDICAL RESEARCH, INC.
By:
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Name:
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Title:
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Address: 000 X. Xxxx Xxxxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Mr. Xxxxx Xxxxxxxx
Telecopy No.: (000) 000-0000
ADVANCE PARADIGM MAIL SERVICES, INC.
By:
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Name:
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Title:
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Address: 000 X. Xxxx Xxxxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Mr. Xxxxx Xxxxxxxx
Telecopy No.: (000) 000-0000
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ADVANCE PARADIGM DATA SERVICES, INC.
By:
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Name:
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Title:
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Address: 000 X. Xxxx Xxxxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Mr. Xxxxx Xxxxxxxx
Telecopy No.: (000) 000-0000
ADVANCE PARADIGM CLINICAL SERVICES, INC.
By:
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Name:
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Title:
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Address: 000 X. Xxxx Xxxxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Mr. Xxxxx Xxxxxxxx
Telecopy No.: (000) 000-0000
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XXXXXX-XXXXXX NEUROMEDICAL
INSTITUTE, INC.
By:
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Name:
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Title:
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Address: 000 X. Xxxx Xxxxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Mr. Xxxxx Xxxxxxxx
Telecopy No.: (000) 000-0000
FOUNDATION HEALTH PHARMACEUTICAL
SERVICES, INC.
By:
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Name:
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Title:
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Address: 000 X. Xxxx Xxxxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Mr. Xxxxx Xxxxxxxx
Telecopy No.: (000) 000-0000
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