Document:

Exhibit 10.47

 

May 22, 2003

 

Alloy Ventures

480 Cowper Street

Second Floor

Palo Alto, California

Attn: 
Tony Di Bona

 

Sprout Group

11 Madison Avenue

13th Floor

New York, NY 10010

Attn: Kathleen D. La Porte

 

Re:          Waiver of Filing Post-Effective
Amendment on Form S-1

Ladies and Gentlemen:

Reference is hereby made to that certain Preferred Stock and Warrant
Purchase Agreement dated as of June 25, 2002, as amended on February 13, 2003,
(the “Purchase Agreement”) by and among Pharsight Corporation (“Pharsight”) and
each of the purchasers named therein (collectively, the “Purchasers”).  All capitalized but undefined terms used
herein shall have the meanings ascribed to them in the Purchase Agreement.

Pursuant to Section 9.2(b) of the Purchase Agreement, Pharsight hereby
notifies each of the Purchasers that, effective upon the filing of Pharsight’s
Annual Report on Form 10-K for Pharsight’s fiscal year ended March 31, 2003,
the Initial Registration Statement shall cease to be effective for the resale
of the Registrable Securities as Pharsight shall cease to be eligible to
register the resale of the Registrable Securities on Form S-3.   Consequently, Pharsight is obligated to use
its commercially reasonable efforts to file a post-effective amendment on Form
S-1 and cause such post-effective amendment to become effective within 90 days
after the delivery notice of this Suspension Notice.

Pharsight hereby requests each of the Purchasers to waive the
requirement under the Purchase Agreement that Pharsight file a post-effective
amendment on Form S-1 when and for so long as Pharsight ceases to be eligible
to register the resale of the Registrable Securities on Form S-3.  Further, Pharsight hereby requests each of
the Purchasers to waive any rights to any Liquidated Damages it may have
pursuant to Section 9.2(f) of the Purchase Agreement as a result of the failure
to file a post-effective amendment on Form S-1.  In this regard, each of the Purchasers hereby acknowledges that
if this waiver is given: (a) Pharsight will rely on this waiver in connection
with its determination not to file a post-effective amendment on Form S-1; and
(b) Pharsight shall not be obligated to make any payment of Liquidated Damages
to any Purchaser for failure to cause the use of the suspended Prospectus to be
resumed during the period during which this waiver is in effect.

Notwithstanding the foregoing, in the event that any Purchaser shall
notify Pharsight that it is

 

 

terminating this waiver (the “Waiver Termination Notice”), then, in
such case: (a) the waiver set forth herein shall cease to be effective from
that day forward; (b) Pharsight shall file such post-effective amendment on
Form S-1, as set forth in the Purchase Agreement, within thirty (30) days of
receipt of such Waiver Termination; (c) for all purposes of the Purchase
Agreement, including without limitation the liquidated damages provisions
thereof, Pharsight’s obligations with respect to the filing of such
post-effective amendment on Form S-1 shall resume as if Pharsight had first given
the Suspension Notice on the date that Pharsight receives the Waiver
Termination; and (d) no Registration Default shall have been deemed to occur
unless and until the earlier of (x) failure by Pharsight to file such
post-effective amendment on Form S-1 within thirty (30) days of delivery of the
Waiver Termination Notice and (y) failure of such post-effective amendment on
Form S-1 to become effective within ninety (90) days of delivery of the Waiver
Termination Notice.

Pharsight covenants and agrees (a) to use its commercially reasonable
efforts to become eligible to register the resale of the Registrable Securities
on Form S-3 as promptly as practicable after the date hereof, and (b) except to
the extent contractually obligated pursuant to contracts existing on the date
hereof, not to file a registration statement with respect to any securities of
Pharsight, other than a registration statement on Form S-8 and the
post-effective amendment on Form S-1, without the prior written consent of
Purchasers who hold at last 75% of the Registrable Securities.

In the event that Purchasers who hold at least 75% of the Registrable
Securities countersign this waiver, then, in accordance with Section 9.11 of
the Agreement, this waiver will be binding against all Purchasers.

All other provisions of the Purchase Agreement shall remain in full
force and effect.

Please
indicate your waiver with respect to such rights by countersigning and
returning this Waiver Letter as soon as possible.

Sincerely,

PHARSIGHT
CORPORATION

 

/s/  Shawn M. O’Connor

 

Shawn M. O’Connor

President and Chief
Executive Officer

 

 

 

The
undersigned have read the foregoing and hereby agree to be bound by its
terms.  This Waiver Letter may be
countersigned in several counterparts, each of which shall constitute an
original and all of which, when taken together, shall constitute one
instrument.

 

PURCHASER(S):

ALLOY PARTNERS 2000, L.P.

ALLOY VENTURES 2000, L.P.

ALLOY CORPORATE 2000, L.P.

ALLOY INVESTORS 2000, L.P.

 

	
  By:

  	
  Alloy
  Ventures 2000, LLC, its General Partner

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/  Douglas E. Kelly

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:  Managing Member

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  480 Cowper Street

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Second Floor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Palo Alto, California

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Attn:  Tony
  Di Bona

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Email:

  	
  cfo@alloyventures.com

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
  (650) 687-5010

  	
   

  	
   

  	
   

  
									

 

PURCHASER(S) CONTINUED:

DONALDSON, LUFKIN & JENRETTE SECURITIES
CORPORATION, as nominee for DLJ First ESC, L.P., EMA 2001 Plan, L.P., CSFB 2001
Investors, L.P., Credit Suisse First Boston Private Equity, Inc., Docklands
2001 Plan, L.P., and Paradeplatz 2001 Plan, L.P.

 

	
  By:

  	
  /s/  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its: Attorney-in-Fact

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  Sprout Group

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  11 Madison Avenue

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  13th Floor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  New York, NY 10010

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Email:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
  (646) 935-7094

  	
   

  	
   

  	
   

  
									

 

SPROUT ENTREPRENEURS FUND, L.P.

 

	
  By:

  	
  DLJ
  Capital Corp., its General Partner

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its:  Managing Director

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  Sprout Group

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  11 Madison Avenue

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  13th Floor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  New York, NY 10010

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Email:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
  (646) 935-7094

  	
   

  	
   

  	
   

  
									

 

 

PURCHASER(S) CONTINUED:

SPROUT CAPITAL IX, L.P.

 

	
  By:

  	
  DLJ
  Capital Corp., its Managing General Partner

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its:  Managing Director

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  Sprout Group

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  11 Madison Avenue

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  13th Floor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  New York, NY 10010

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Email:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
  (646) 935-7094

  	
   

  	
   

  	
   

  
									

 

SPROUT CAPITAL VII, L.P.

 

	
  By:

  	
  DLJ
  Capital Corp., its Managing General Partner

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its:  Managing Director

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  Sprout Group

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  11 Madison Avenue

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  13th Floor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  New York, NY 10010

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Email:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
  (646) 935-7094

  	
   

  	
   

  	
   

  
									

 

 

PURCHASER(S) CONTINUED:

SPROUT CEO FUND, L.P.

 

	
  By:

  	
  DLJ
  Capital Corp., its Managing General Partner

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its:  Managing Director

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  Sprout Group

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  11 Madison Avenue

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  13th Floor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  New York, NY 10010

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Email:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
  (646) 935-7094

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
									

 

DLJ CAPITAL CORP.

 

	
  By:

  	
  /s/  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its:  Managing Director

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  Sprout Group

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  11 Madison Avenue

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  13th Floor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  New York, NY 10010

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Email:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
  (646) 935-7094

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
									

 

DLJ FIRST ESC L.P.

 

	
  By:

  	
  DLJ
  LBO Plans Management Corporation, its General Partner

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:  Philippe Chambon

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its:  Attorney-in-Fact

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
  Sprout Group

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  11 Madison Avenue

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  13th Floor

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  New York, NY 10010

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Email:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  	
  (646) 935-7094Exhibit
10.48

 

LOAN MODIFICATION AGREEMENT

 

This
Loan Modification Agreement is entered into as of May 28, 2003, by and between
Pharsight Corporation (the “Borrower”) and Silicon Valley Bank (“Bank”).

 

1.             DESCRIPTION OF
EXISTING OBLIGATIONS:  Among other Obligations
which may be owing by Borrower to Bank, Borrower is indebted to Bank pursuant
to, among other documents, a Loan and Security Agreement, dated June 13, 2001,
as amended or modified from time to time, (the “Domestic Loan Agreement”). The
Domestic Loan Agreement provides for, among other things, a Committed Revolving
Line in the original principal amount of Two Million Five Hundred Thousand
Dollars ($2,500,000) and a Committed Term Loan in the original principal amount
of Three Million Five Hundred Thousand Dollars ($3,500,000).  Furthermore, Borrower is indebted to Bank
pursuant to, among other documents, an Export-Import Bank Loan and Security
Agreement, dated June 13, 2001, as may be amended from time to time (the “EXIM
Loan Agreement”).  The EXIM Loan
Agreement provided for, among other things, an EXIM Committed Line in the
original principal amount of One Million Five Hundred Thousand Dollars
($1,500,000).  The Domestic Loan
Agreement and the EXIM Loan Agreement are collectively defined as the “Loan
Agreements”.  Defined terms used but not
otherwise defined herein shall have the same meanings as set forth in the Loan
Agreement.

 

Hereinafter, all indebtedness owing by Borrower to Bank shall be
referred to as the “Obligations.”

 

2.             DESCRIPTION OF COLLATERAL.
Repayment of the Obligations is secured by the Collateral as described in the
Loan Agreement.  Additionally, repayment
of the EXIM Committed Line is guaranteed by the Export-Import Bank of the
United States “EXIM Bank” pursuant to a master Guarantee Agreement between EXIM
Bank and Bank.

 

Hereinafter,
the above-described security documents and guaranties, together with all other
documents securing repayment of the Obligations shall be referred to as the
“Security Documents”.  Hereinafter, the
Security Documents, together with all other documents evidencing or securing
the Obligations shall be referred to as the “Existing Loan Documents”.

 

3.             DESCRIPTION OF CHANGE IN TERMS.

 

A.                                Modification(s)
to Domestic Loan Agreement.

 

1.                                       Section 6.6 entitled
“Primary Accounts: Minimum and Target Balances” is hereby amended in part to
provide that Borrower agrees that it shall deposit or invest through Bank (in
the sweep account or one of IPS Mutual Funds) at least two-third (2/3) of its
cash and cash equivalents (as determined pursuant to GAAP and as reflected in
Borrower’s monthly financial statements).

 

2.                                       Sub letter (a) under
Section 6.2 entitled “Financial Statements, Reports, Certificates” is hereby
amended in its entirety to read as follows:

 

(a)  Borrower will deliver to
Bank:  (i) as soon as available, but no
later than 30 days after the last day of each month, a company prepared
consolidated balance sheet and income statement covering Borrower’s
consolidated operations during the period certified by a Responsible Officer
and in a form acceptable to Bank; (ii) as soon as available, but no later than
90 days after the last day of Borrower’s fiscal year, audited consolidated
financial statements prepared under GAAP, consistently applied, together with a
an unqualified opinion of the financial statements from an independent
certified public accounting firm reasonably acceptable to Bank; (iii) a prompt
report of any legal actions pending or threatened against Borrower or any
Subsidiary that could result in

 

 

 

damages or costs to Borrower or any Subsidiary of $100,000 or more; (iv)
board of directors’ approved budgets, sales projections or other financial
information Bank request, and, in any event, within 30 days after the end of
Borrower’s fiscal year.

 

 

3.                                       Sub letter (b)
under Section 6.2 entitled “Financial Statements, Reports, Certificate” is
hereby amended in part to also include deferred revenue schedules within 20
days after the last day of each month end.

 

4.                                       Sub letter (e) under Section 6.2 entitled “Financial
Statements, Reports, Certificate” is hereby incorporated to read as follows:

 

(e) On or prior to April 30th of each year, Borrower will
deliver to Bank its board of directors’ approved operating plan.

 

5.                                       Section 6.7 entitled
“Financial Covenants” is hereby amended in its entirety to read as follows:

 

Borrower will maintain on the last day of each month:

 

(a)                 Liquidity.  Maintain Liquidity of at least twice the
amount of the outstanding aggregate balance of the Term Loan Advances.

 

(b)                Remaining Months
Liquidity.  Maintain at least six months
Remaining Months Liquidity.  Remaining
Months Liquidity is defined as Liquidity minus the outstanding Term Loan
Advances divided by Net Cash Loss.  Net
Cash Loss is defined as a trailing three months average change in cash from
operations.

 

(c)                 Maximum Cumulative
Losses.  Beginning with the month ending
June 30, 2003 through the month ending May 31, 2004, Borrower’s cumulative
monthly losses shall not exceed the levels forecast in its operating plan as
provided and approved by Borrower’s board of directors on April 24, 2003 and as
submitted to Bank on May 5, 2003 by more than 20%.  Bank may, in its discretion, reset this covenant annually no
later than May 31st of each year.

 

7.                                       The
following defined terms under Section 13.1 entitled “Definitions” are hereby
amended to read as follows:

 

                “Committed
Revolving Line” is an extension of up to $1,400,000.

 

                “Revolving Maturity
Date” is May 27, 2004.

 

                B.            Modification(s) to EXIM Loan
Agreement.

 

1.               The following
defined terms under Section 13 entitled “Definitions” are hereby amended to
read as follows:

 

                                “Exim
Committed Line” is an Advance of up to $600,000.

 

                                “Exim
Maturity Date” is May 27, 2004.

 

2.               Sub letters (a), (c)
and (r) under the defined term “Exim Eligible Foreign Accounts” under Section
13 entitled “Definitions” are hereby amended and replaced to read as follows:

 

(a)          Accounts with terms
of sale greater than 90 days.

 

 

 

 

(c)  Credit balances over 60 days
past original invoice due date.

 

(r)            Accounts with open
account terms with balance more than 25% concentration of total foreign
Accounts, unless pre-approved by Bank.

 

4.             CONSISTENT
CHANGES.  The Existing Loan
Documents are hereby amended wherever necessary to reflect the changes
described above.

 

5.             NO DEFENSES OF BORROWER.  Borrower (and each guarantor and pledgor
signing below) agrees that, as of the date hereof, it has no defenses against
paying any of the Obligations.

 

6.             PAYMENT OF LOAN
FEE.  Borrower shall pay Bank a fee
in the amount of Seven Thousand Dollars ($7,000) (“Domestic Loan Fee”) and Nine
Thousand Dollars ($9,000) (“EXIM Loan Fee”) plus all out-of-pocket expenses.

 

7.             CONTINUING
VALIDITY.  Borrower (and each
guarantor and pledgor signing below) understands and agrees that in modifying
the existing Indebtedness, Bank is relying upon Borrower’s representations,
warranties, and agreements, as set forth in the Existing Loan Documents.  Except as expressly modified pursuant to
this Loan Modification Agreement, the terms of the Existing Loan Documents
remain unchanged and in full force and effect. 
Bank’s agreement to modifications to the existing Obligations pursuant
to this Loan Modification Agreement in no way shall obligate Bank to make any
future modifications to the Obligations. 
Nothing in this Loan Modification Agreement shall constitute a
satisfaction of the Obligations.  It is
the intention of Bank and Borrower to retain as liable parties all makers and
endorsers of Existing Loan Documents, unless the party is expressly released by
Bank in writing.  Unless expressly
released herein, no maker, endorser, or guarantor will be released by virtue of
this Loan Modification Agreement.  The
terms of this paragraph apply not only to this Loan Modification Agreement, but
also to all subsequent loan modification agreements.

 

8.             CONDITIONS.  The effectiveness of this Loan Modification
Agreement is conditioned upon payment of the Domestic Loan Fee and EXIM Loan
Fee.

 

                This Loan
Modification Agreement is executed as of the date first written above.

 

	
  BORROWER:

  	
   

  	
   

  	
  BANK:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  PHARSIGHT CORPORATION

  	
   

  	
   

  	
  SILICON VALLEY BANK

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/  Charles Faas

  	
   

  	
  By:

  	
  /s/  Ron Kundich

  
	
  Name:

  	
  Charles
  Faas

  	
   

  	
  Name:

  	
  Ron
  Kundich

  
	
  Title:

  	
  Chief
  Financial Officer

  	
   

  	
  Title:

  	
  Vice
  President

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