| Item 1.01 | Entry
Into a Material Definitive Agreement. |
On November 1, 2022 (the “Amendment
Date”), Eagle Pharmaceuticals, Inc. (the “Company”), entered into the Third Amended and Restated Credit Agreement, (the
“Amended Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent, (the “Agent”) and the lenders
party thereto, which amended and restated in its entirety the Company’s existing credit agreement, dated as of November 8, 2019
(the “Existing Facility”).
The Amended Credit Agreement provides for
a three-year $100 million revolving credit facility (the “Revolving Credit Facility”), which includes a $5 million letter
of credit sub facility, and a three-year $50 million term loan facility (the “Term Loan Facility,” and collectively with the
Revolving Credit Facility, the “Credit Facility”). On the Amendment Date, the Company borrowed $15 million under the Revolving
Credit Facility and $50 million under the Term Loan Facility (the “Term Loan”). Approximately $35.4 million of the proceeds of the Credit Facility
were used on the Amendment Date to refinance all amounts outstanding under the Existing Facility, and the Company currently intends to
use the remaining proceeds to repay certain indebtedness of the Company’s wholly-owned subsidiary, Acacia Pharma Group Limited,
and for other corporate purposes. The Revolving Credit Facility and the Term Loan Facility each mature on October 31, 2025, unless required
to mature earlier or extended pursuant to the terms of the Amended Credit Agreement.
Loans under the Credit Facility bear interest,
at the Company’s option, at a rate equal to either (a) the SOFR rate, plus a credit adjustment spread, plus an applicable margin
ranging from 2.50% to 3.25% per annum, based upon the total net leverage ratio (as defined in the Amended Credit Agreement) or (b) the
prime lending rate, plus an applicable margin ranging from 1.50% to 2.25% per annum, based upon the total net leverage ratio. The Company
is required to pay a commitment fee on the unused portion of the Revolving Credit Facility at a rate ranging from 0.375% to 0.475% per
annum based upon the total net leverage ratio.
The Term Loan amortizes in quarterly installments
in an amount equal to $1.25 million per fiscal quarter for each fiscal quarter ended after the Closing Date through the fiscal quarter
ended September 30, 2023, and in an amount equal to $2.5 million per fiscal quarter for each fiscal quarter thereafter.
The Company is permitted to terminate or reduce
the commitments under the Revolving Credit Facility and to make voluntary prepayments at any time subject to break funding payments. The
Company is required to make mandatory prepayments (a) of the Term Loan with the net proceeds (i) of certain asset sales, transfers or
other dispositions, (ii) received in respect of casualty and other condemnation losses and (iii) any indebtedness incurred that does not
constitute permitted indebtedness, subject in the case of (i) and (ii), to customary reinvestment rights, and (b) under the Revolving
Credit Facility at any time the aggregate amount of all outstanding loans and letters of credit issued under the Revolving Credit Facility
exceeds the aggregate commitment of all lenders under the Revolving Credit Facility, in an amount equal to such excess.
The Amended Credit Agreement contains customary
representations and warranties and customary affirmative and negative covenants applicable to the Loan Parties (as defined below) and
its consolidated subsidiaries, including, among other things, restrictions on indebtedness, liens, investments, mergers, dispositions,
prepayment of other indebtedness and dividends and other distributions. Under the terms of the Amended Credit Agreement, the Company is
required to comply with (a) a maximum total net leverage ratio, (b) a fixed charge coverage ratio and (c) a minimum liquidity covenant.
Events of default under the Amended Credit
Agreement include: (a) the failure by the Company to timely make payments due under the Amended Credit Agreement; (b) material misrepresentations
or misstatements in any representation or warranty by any Loan Party when made; (c) the failure by any Loan Party to comply with the covenants
under the Amended Credit Agreement and other related agreements; (d) certain defaults under a specified amount of other indebtedness of
the Company or its subsidiaries; (e) insolvency or bankruptcy-related events with respect to the Company or any of its subsidiaries; (f)
certain judgments against either the Company or any of its subsidiaries; (g) certain ERISA-related events reasonably expected to have
a material adverse effect on the Company and its subsidiaries taken as a whole; (h) the failure by the collateral documents to create
a valid and perfected security interest in any material portion of the collateral purported to be covered thereby; (i) any material provision
of any loan document ceasing to be, or being asserted by any Loan Party not to be, valid, binding and enforceable, or a denial in writing
by any Loan Party of any further liability under the loan documents; (j) the occurrence of a change in control with respect to the Company
and (k) the occurrence of a default under a material exclusive license. If one or more events of default occurs and continues, the Agent
may, with the consent of the lenders holding a majority of the loans and commitments under the facilities, or will, at the request of
such lenders, terminate the commitments of the lenders to make further loans and declare all of the obligations of the Loan Parties under
the Amended Credit Agreement to be immediately due and payable. If any bankruptcy event of default described in clause (e) above occurs,
the commitments will be terminated and the obligations of the Loan Parties under the Amended Credit Agreement will become due and payable
automatically without any action by the Agent or the lenders.
The obligations of the Company under the Credit
Facility are currently guaranteed by the Company’s wholly-owned subsidiaries, Eagle Biologics, Inc. and Eagle Research Labs Limited
(which together with the Company are collectively referred to as the “Loan Parties”) and may in the future be guaranteed by
certain material domestic subsidiaries and other subsidiaries of the Company. The obligations of the Loan Parties under the Amended Credit
Agreement and other loan documents are secured, subject to customary permitted liens and other agreed upon exceptions, by a perfected
security interest in (a) all tangible and intangible assets of the Loan Parties, except for certain excluded assets, and (b) all of the
equity interests of the subsidiaries of the Loan Parties held by the Loan Parties (limited, in the case of the voting equity interests
of certain foreign subsidiaries and certain domestic subsidiaries that hold no assets other than equity interests of foreign subsidiaries,
to 65% of the voting equity interests of such subsidiaries).
The foregoing description of the Amended Credit
Agreement is not intended to be complete and is qualified in its entirety by reference to the full text of the Amended Credit Agreement,
which is filed as Exhibit 10.1 to this Current Report on Form 8-K.