Limited Waiver and Amendment No. 2 Regarding Credit Agreement



 Exhibit 10.3 
 LIMITED WAIVER AND AMENDMENT NO. 2 REGARDING CREDIT AGREEMENT 
 This
LIMITED WAIVER AND AMENDMENT NO. 2 REGARDING CREDIT AGREEMENT (this “Agreement”) entered into March 3, 2010 and effective as of March 1, 2010, is by and among SAGENT PHARMACEUTICALS, a Wyoming corporation
(“Borrower”) and MIDCAP FUNDING I, LLC, a Delaware limited liability company (“MCF”) as Agent (in such capacity, “Agent”) and as the sole Lender (in such capacity, “Lender”).

 RECITALS: 
 WHEREAS, Borrower, any additional borrower that may hereafter be added, Agent and Lenders are parties to that certain Credit Agreement dated as of June 16, 2009 (as amended, restated, modified or
otherwise supplemented from time to time, the “Credit Agreement”), pursuant to which Lenders have agreed to make loans and other extensions of credit to Borrower in accordance with the terms thereof; 

WHEREAS, Borrower wishes and Agent is willing, to provide a limited waiver in respect of the Credit Agreement, subject to the terms and
conditions of this Agreement; 
 WHEREAS, in consideration of Agent granting such limited waiver, Borrower, Agent and Lenders
agree to amend the Credit Agreement pursuant to the terms hereof; and 
 WHEREAS, this Agreement shall constitute a Financing
Document, these Recitals shall be construed as part of this Agreement and capitalized terms used but not otherwise defined in this Agreement shall have the meanings described to them in the Credit Agreement. 

NOW, THEREFORE, in consideration of the foregoing and the agreements, promises and covenants set forth below, and for other good and
valuable consideration the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 

Section 1 Limited Waiver. Borrower acknowledges that the following Event of Default has occurred (the “Subject
Event of Default”): 
 (i) An Event of Default has occurred under Section 10.1(n) due to Borrower’s failure to
provide, on or before February 26, 2010, (i) evidence of (A) the receipt of an equity contribution by Holdings in a minimum amount of $10,000,000 on terms that are reasonably acceptable to Agent and (B) a subsequent contribution
by Holdings to Sagent of the proceeds of such equity contribution or (ii) evidence that Sagent has received approval from the FDA to begin manufacturing the Product commonly known as Heparin. 

Subject to the conditions set forth herein, Agent hereby waives the Subject Event of Default. The foregoing waiver is expressly limited
to the Subject Event of Default and shall not affect any breach of the subject provisions for any other period. 







 Section 2 Amendments to Credit Agreement. 

(a) Section 2.2(g) of the Credit Agreement is hereby deleted in its entirety and restated to read as follows:

 “(g) Deferred Revolving Loan Commitment Fee. If Lenders’ funding obligations in respect of the Revolving Loan
Commitment under this Agreement terminate for any reason (whether by voluntary termination by Borrowers, by reason of the occurrence of an Event of Default or otherwise) prior to the Commitment Expiry Date, Borrowers shall pay to Agent, for the
benefit of all Lenders committed to make Revolving Loans on the Closing Date, a fee as compensation for the costs of such Lenders being prepared to make funds available to Borrowers under this Agreement, equal to an amount determined by multiplying
the Revolving Loan Commitment by the following applicable percentage amount: five percent (5.0%) for the first year following the Closing Date, five percent (5.0%) for the second year following the Closing Date, and four percent
(4.0%) thereafter. All fees payable pursuant to this paragraph shall be deemed fully earned and non-refundable as of the Closing Date.” 
 (b) Section 6.2 of the Credit Agreement is hereby deleted in its entirety and restated to read as follows: 
 “Minimum Net Invoiced Revenues. Borrowers agree that an Event of Default shall be deemed to have occurred under this Agreement if the Borrowers’ Net Invoiced Revenues for any twelve month
trailing period preceding, and ending as of, the end of each calendar month below (which shall be the Defined Period) shall be less than the amounts set forth below (or any lower amount identified in writing by Agent): 

 

			
	 Period
	  	Net Invoiced Revenues
	April, 2009	  	$20,625,701
	May, 2009	  	$21,772,297
	June, 2009	  	$23,110,791
	July, 2009	  	$25,574,435
	August, 2009	  	$26,807,796
	September, 2009	  	$31,708,001
	October, 2009	  	$                0
	November, 2009	  	$                0
	December, 2009	  	$                0
	January 2010	  	$                0
	February, 2010	  	$                0
	March, 2010	  	$  2,180,100
	April, 2010	  	$  2,639,172
	May, 2010	  	$  2,832,716


  
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 Agent shall, in its sole discretion, determine and set Borrowers’ minimum Net Invoiced
Revenues for the remainder of 2010. Agent shall consult with Borrowers in determining the remaining 2010 minimum Net Invoiced Revenues, but Agent shall make such determination in its sole discretion. Agent shall set Borrowers’ minimum Net
Invoiced Revenues for each calendar quarter during 2011 at an amount equal to 70% of the 2011 board-approved plan, which shall be delivered to Agent on or before December 31, 2010, which plan shall call for annual revenue of not less than
$120,000,000. Upon any such determination by Agent, Borrowers, Agent and Lenders agree to amend this Section 6.2 to incorporate such minimum Net Invoiced Revenues.” 

(c) Section 10.1(n) of the Credit Agreement is hereby deleted in its entirety and restated to read as follows:

 “(n) Borrowers shall fail to provide, on or before May 27, 2010, (i) evidence of (A) the receipt of an
equity contribution by Holdings in a minimum amount of $9,800,000 on terms that are reasonably acceptable to Agent and (B) a subsequent contribution by Holdings to Sagent of the proceeds of such equity contribution or (ii) evidence that
Sagent has received approval from the FDA to begin manufacturing the Product commonly known as Heparin; and” 

Section 3 Representations and Warranties. To induce Agent and Lender to enter into this Agreement, Borrower represents
and warrants that: 
 (a) No Default. No Default or Event of Default shall have occurred and be continuing
as of the date hereof, after giving effect to this Agreement; 
 (b) Representations and Warranties. As of
the date hereof and, after giving effect to this Agreement and the transactions contemplated hereby, the representations and warranties of Borrower contained in the Financing Documents are true and correct in all material respects (or if any
representation or warranty is qualified with respect to materiality, in all respects) on and as of the date hereof to the same extent as though made on and as of such date except to the extent such representations and warranties specifically relate
to an earlier date; and 
 (c) Organizational Authority. (i) The execution, delivery and performance
by Borrower of this Agreement are within its corporate powers and have been duly authorized by all necessary corporate action, (ii) this Agreement is the legal, valid and binding obligation of Borrower enforceable in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency or other similar laws relating to the enforcement of creditors’ rights generally and by equitable principles, and (iii) neither


  
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the execution, delivery or performance by Borrower of this Agreement (1) violates any Law, or any other rule or decree of any Governmental Authority, (2) conflicts with or results in
the breach or termination of, constitutes a default under or accelerates any performance required by, any indenture, mortgage, deed of trust, lease, agreement or other instrument to which Borrower is a party or by which Borrower or any of its
property is bound, except for such conflicts, breaches, terminations, defaults or accelerations that would not reasonably be expected to have a Material Adverse Effect, (3) results in the creation or imposition of any Lien (other than Permitted
Liens) upon any of the Collateral, (4) violates or conflicts with the by-laws or other organizational documents of Borrower, or (5) requires the consent, approval or authorization of, or declaration or filing with, any other Person, except
for those already duly obtained. 
 Section 4 Conditions Precedent. The effectiveness of this Agreement is
subject to the following conditions precedent: 
 (a) No Default. No Default or Event of Default under the
Credit Agreement, subject to the waiver granted pursuant hereto, shall have occurred and be continuing. 
 (b)
Warranties and Representations. After giving effect to this Agreement and the transactions contemplated hereby, the warranties and representations of Borrower contained in the Financing Documents shall be true and correct in all material
respects (or if any representation or warranty is qualified with respect to materiality, in all respects) as of the effective date hereof, with the same effect as though made on such date, except to the extent that such warranties and
representations expressly relate to an earlier date. 
 (c) Other Requirements. Agent shall have received
such other documentation which it shall have reasonably requested pursuant to this Agreement. 
 Section 5
Reference to and Effect on Financing Documents. 
 (a) Ratification. Except as specifically amended
above, the Credit Agreement and the other Financing Documents shall remain in full force and effect. Notwithstanding anything contained herein, the terms of this Agreement are not intended to and do not effect a novation of the Credit Agreement or
any other Financing Document. Borrower hereby ratifies and reaffirms each of the terms and conditions of the Financing Documents and all of its obligations thereunder. 

(b) No Waiver. The execution, delivery and effectiveness of this Agreement shall not operate as a waiver (except to
the limited extent set forth in Section 1 hereof) of any right, power or remedy of Lenders or Agent under the Credit Agreement or any of the other Financing Documents. 

(c) References. Upon the effectiveness of this Agreement each reference in (a) the Credit Agreement to
“this Agreement,” “hereunder,” “hereof,” or words of similar import and (b) any other Financing Document to “the Agreement” or “the Credit Agreement” shall, in each case and except as otherwise
specifically stated therein, mean and be a reference to the Credit Agreement as amended hereto. 

  
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 Section 6 Releases; Indemnities. 

(a) Borrower hereby agrees that its obligation to indemnify and hold the Indemnitees harmless as set forth in the Credit
Agreement shall include an obligation to indemnify and hold the Indemnitees harmless with respect to any and all liabilities, obligations, losses, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever incurred by the Indemnitees, or any of them, whether direct, indirect or consequential, as a result of or arising from or relating to any proceeding by, or on behalf of, any Person, including, without limitation, officers, directors,
agents, trustees, creditors, partners or shareholders of Borrower, whether threatened or initiated, asserting any claim for legal or equitable remedy under any statute, regulation or common law principle arising from or in connection with the
negotiation, preparation, execution, delivery, performance, administration and enforcement of this Agreement or any other document executed in connection herewith, other than arising out of such Indemnitees’ gross negligence or willful
misconduct, as determined by a final non-appealable judgment of a court of competent jurisdiction. The foregoing indemnity shall survive the payment in full of the Obligations and the termination of this Agreement, the Credit Agreement and the other
Financing Documents. 
 Section 7 Miscellaneous. 

(a) Successors and Assigns. This Agreement shall be binding on and shall inure to the benefit of Borrower, Agent
and Lenders and their respective successors and permitted assigns. 
 (b) Entire Agreement. This Agreement
constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and supersedes all other understandings, oral or written, with respect to the subject matter hereof. 

(c) Fees and Expenses. Borrower shall be responsible for the payment of all expenses and fees of Agent and all
reasonable fees of Agent’s counsel incurred in connection with the preparation of this Agreement and any related documents. Borrower hereby authorizes Agent to deduct all of such fees set forth in this Section 8 from the proceeds of the
Revolving Credit Loans made under the Credit Agreement. 
 (d) Headings. Section headings in this
Agreement are included herein for convenience of reference only and shall not constitute a part of this Agreement for any other purpose. 
 (e) Severability. Wherever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement
shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.


  
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 (f) Counterparts. This Agreement may be executed in any number
of separate original counterparts (or telecopied counterparts with original execution copy to follow) and by the different parties on separate counterparts, each of which shall be deemed to be an original, but all of such counterparts shall together
constitute one agreement. Delivery of an executed counterpart of a signature page to this Agreement by telecopy shall be effective as delivery of a manually executed counterpart of this Agreement. 

(g) Incorporation of Credit Agreement Provisions. The provisions contained in Section 12.10 (Governing Law)
and Section 12.11 (Jury Waiver) of the Credit Agreement are incorporated herein by reference to the same extent as if reproduced herein in there entirety. 
 [Signatures follow] 

  
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 Signature Page to Limited Waiver and Amendment No. 2 Regarding Credit Agreement

 IN WITNESS WHEREOF, intending to be legally bound, and intending that this agreement constitute an agreement executed
under seal, the undersigned have executed this Agreement under seal as of the day and year first hereinabove set forth. 
  

							
	BORROWER:	 	SAGENT PHARMACEUTICALS, a
		 	Wyoming corporation
				
		 	By:	 	 /s/ Ronald Pauli
	 	(SEAL)
		 		 	 Ronald Pauli
	 	
		 		 	Chief Financial Officer	 	








 Signature page to Limited Waiver and Amendment No. 2 Revolving Credit Agreement

  

							
	AGENT and LENDER:	 	 MIDCAP FUNDING I, LLC, a Delaware limited
 liability company, as Agent and Lender

				
		 	By:	 	 /s/ Brett Robinson
	 	(SEAL)
		 		 	Brett Robinson	 	
		 		 	Managing Director