Exhibit 10.54

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

SUPPLY AGREEMENT

between

Jazz Pharmaceuticals, Inc., 3180 Porter Drive, Palo Alto, CA 94304

(hereinafter “JAZZ PHARMACEUTICALS”)

and

Siegfried (USA) Inc, 33 Industrial Park Road, Pennsville, NJ, 08070,

(hereinafter “SIEGFRIED”)

 

 

Recitals

WHEREAS, SIEGFRIED is engaged in the business of, among other things,
manufacturing pharmaceutical products for the pharmaceutical industry;

WHEREAS, JAZZ PHARMACEUTICALS now desires to have SIEGFRIED manufacture for, and
supply to, JAZZ PHARMACEUTICALS the Active Material (as herein below defined) in
accordance with the terms of this Agreement (as herein below defined);

WHEREAS, JAZZ PHARMACEUTICALS desires SIEGFRIED to supply to JAZZ
PHARMACEUTICALS the Active Material in accordance with the terms of this
Agreement; and

WHEREAS, SIEGFRIED, subject to the terms and conditions of this Agreement,
desires to so supply the Active Material to JAZZ PHARMACEUTICALS in accordance
with the terms of this Agreement.

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NOW, THEREFORE, in consideration of the mutual covenants and promises contained
in this Agreement the Parties agree as follows:

 

1. DEFINITIONS

Each of the capitalized terms used in this Agreement (other than the names of
the Parties and the headings of the Articles and Sections) shall have the
meanings indicated below. Such meanings shall apply equally to all forms of such
terms, including singular and plural forms, unless otherwise clearly indicated.

“Act” shall mean the United States Food, Drug and Cosmetic Act, as amended from
time to time, and the regulations promulgated thereunder.

“Active Material” shall mean the active pharmaceutical ingredient (API) listed
on Schedule 1. hereto.

“Affiliate” shall mean with respect to any Party any person or entity
controlling, controlled by, or under common control with a Party at any time
during the term of this Agreement. For purposes of this definition, the term
“control” shall mean the power to direct or cause the direction of the
management and policies of an entity, whether through the ownership of voting
stock, by contract or otherwise. In the case of a corporation, the term
“control” shall mean the direct or indirect ownership of at least fifty percent
(50%) of the outstanding voting stock.

“Agreement” shall mean this Agreement including its Schedules (and Appendices,
if applicable), as may be amended from time to time.

“Batch” means a specific quantity of Active Material that is intended to have
uniform character and quality, within specified limits, and is produced during
the same cycle of manufacture.

“Business Day” shall mean a day (not being a Saturday or Sunday) on which banks
are open for business in New York.

“cGMPs” means current good manufacturing practices, as applicable, as described
in:

 

  (a) Parts 210 and 211 of Title 21 of the United States’ Code of Federal
Regulations;

 

  (b) Division 2 of Part C of the Food and Drug Regulations (Canada);

 

  (c) EC Directive 91/356/EEC; and

 

  (d) the latest Health Canada, Ministry of Health, Labour, and Welfare, FDA and
EMEA guidance documents pertaining to manufacturing and quality control
practice, as updated, amended and revised from time to time and as applicable
under the particular circumstances.

“Confidential Information” shall mean any information of whatever kind
(including without limitation, data, compilations, formulae, models, patent
disclosures, procedures, processes, projections, protocols, results of
experimentation and testing, specifications, strategies and techniques), and all
tangible and intangible embodiments thereof of any kind whatsoever (including
without limitation, samples, apparatus, compositions, documents, drawings,
machinery, patent applications, records and reports) which has been or will be
disclosed by one Party (“Disclosing Party”) to the other Party (“Receiving
Party”) in connection with this Agreement, and which is confidential or
proprietary to the Disclosing Party or an Affiliate thereof, including, without
limitation, any and all information pertaining to the Active Material and
information which relates to the business of either Party, including business
plans, strategies, operations policies, procedures, techniques, accounts,
marketing plans, financial plans and status, and personnel of either Party.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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“DEA” means the United States Drug Enforcement Administration or, if applicable,
its international counterparts.

“Effective Date” means April 1, 2010 unless revised by mutual written agreement
of the parties in accordance with this Agreement.

“EMEA” means the European Medicines Agency or any successor European
governmental agency performing similar functions with respect to pharmaceutical
products.

“FDA” means the United States government department known as the Food and Drug
Administration or any successor United States governmental agency performing
similar functions with respect to pharmaceutical products.

“Finished Dosage Form” shall mean a final form of a drug product containing any
Active Material.

“Health Canada” means a section of the Canadian Government known as Health
Canada and includes, among other departments, the Therapeutic Products
Directorate and Health Products and Food Branch Inspectorate or any successor
Canadian governmental agency performing similar functions with respect to
pharmaceutical products.

“Hidden Defects” shall mean any instance where a Batch of Active Material fails
to conform to the Specifications, such failure not being discoverable upon
Inspection or standard testing of Active Material in accordance with Section 3.2
or at any point in the production of the Finished Dosage Form.

“Inspection” shall mean any reasonable activity other than testing to determine
the condition of the Product, including without limitation, visual inspection of
the packaging condition, visual inspection of the label, visual inspection of
Active Material condition, and review of Active Material documentation, and
“Inspect” shall mean to conduct an Inspection.

“Intellectual Property” includes, without limitation, rights in patents, patent
applications, formulae, trade-marks, trade-mark applications, trade-names,
Inventions (as herein defined below), copyright and industrial designs.

“Laws” means all laws, statutes, ordinances, regulations, rules, by-laws,
judgments, decrees or orders of any Regulatory Authority applicable to the
activities hereunder.

“Manufacture” shall mean all activities with respect to the manufacturing of the
Active Material, including, without limitation, production, quality control,
packaging and release for shipment.

“Manufacturing Commencement Date” means the date when SIEGFRIED will commence
Manufacturing Services to manufacture and package Active Material hereunder.

“Manufacturing Services” means during the period commencing on the Manufacturing
Commencement Date and throughout the term of this Agreement, all of the
Manufacturing, quality control, quality assurance and stability testing and
related services as contemplated in this Agreement.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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“Manufacturing Site” means the facility owned and operated by SIEGFRIED that is
located at 33 Industrial Park Road, Pennsville, NJ, 08070 or such other facility
located in the United States that is owned by SIEGFRIED and approved by JAZZ
PHARMACEUTICALS pursuant to Section .2.5 of this Agreement.

“Ministry of Health, Labour, and Welfare” means the Japanese regulatory
authority responsible for promulgating regulations for the good manufacturing
practices related to the manufacture of the Active Material.

“Party/ies” shall mean either JAZZ PHARMACEUTICALS or SIEGFRIED, or both, as the
context may require.

“Quality Agreement” shall mean the agreement between JAZZ PHARMACEUTICALS and
SIEGFRIED which defines the responsibilities of each Party with respect to the
practices to be followed to ensure Active Material quality and compliance under
cGMP and applicable Laws, as same may be amended from time to time by written
agreement between the Parties. Upon execution, such agreement will be attached
to and incorporated by reference in this Agreement.

“Quota” means the manufacturing quota quantity of Active Material allotted by
the DEA to SIEGFRIED in order for SIEGFRIED to perform the Manufacturing
Services.

“Regulatory Authority” shall mean the FDA, EMEA, Ministry of Health, Labour, and
Welfare, Health Canada and any other national or supranational authorities which
are responsible for approving the conduct of clinical trials, marketing and sale
of pharmaceutical products in their respective markets.

“Specifications” shall mean the detailed description of the technical
requirements for the Active Material set out in detail in Schedule 1 attached
hereto, as may be updated, amended and revised from time to time in accordance
with Section 6.3 of this Agreement.

“Territory” means the entire world.

“United States” means the United States of America, its territories and
possessions, including Puerto Rico and the U.S Virgin Islands.

“Year” means in the first year of this Agreement, the period from the
Manufacturing Commencement Date up to and including December 31 of the same
calendar year, and thereafter shall mean a calendar year.

 

2. TECHNOLOGY TRANSFER, MANUFACTURE AND SUPPLY OF ACTIVE MATERIAL

2.1 SIEGFRIED hereby agrees to conduct the technology transfer of the Active
Material to the Manufacturing Site in accordance with the plan agreed upon in
writing by the Parties (“Technology Transfer Plan”), the goal of which is to
transfer the current process for commercial manufacture of the Active Material,
develop protocols for testing the Active material, and finalize Specifications.
SIEGFRIED and JAZZ PHARMACEUTICALS agree to designate one individual who will
serve as a central liaison to the other at all times. The person designated will
have the capability and authority to assist with coordination and resolution of
any and all issues that might arise. SIEGFRIED shall perform validations for the
Active Material at its Manufacturing Site, provide stability samples, and
prepare the chemical manufacturing section for JAZZ PHARMACEUTICALS to file with
FDA. A more detailed description, including the time schedule for completion of
all transfer activities will be set forth in the Technology Transfer Plan to be
attached hereto and made a part hereof. A preliminary baseline for the
Technology Transfer Plan and the compensation to be paid to SIEGFRIED thereunder
is attached as Schedule 2.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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2.2 Promptly upon completion of each development milestone by SIEGFRIED, as set
forth in the Technology Transfer Plan, SIEGFRIED shall deliver to JAZZ
PHARMACEUTICALS a complete written report or reports. A detailed description of
such reports, as well as other reports to be provided by SIEGFRIED will be set
forth in the Technology Transfer Plan. Within [ * ] after the delivery to JAZZ
PHARMACEUTICALS of each report, JAZZ PHARMACEUTICALS shall either (a) accept
such report and notify SIEGFRIED to proceed with the Technology Transfer Plan or
(b) send SIEGFRIED written notice of SIEGFRIED’s failure to conduct such
activities in accordance with the requirements set forth in the Technology
Transfer Plan. SIEGFRIED agrees to take such corrective actions and to conduct
such additional work required to satisfy the requirements set forth in the
Technology Transfer Plan.

2.3 In consideration of SIEGFRIED’s conduct of the Technology Transfer Plan,
JAZZ PHARMACEUTICALS agrees to pay SIEGFRIED the amounts set forth in the
Technology Transfer Plan. JAZZ PHARMACEUTICALS shall only pay SIEGFRIED for
milestones which are completed. A breakdown of costs for each milestone will be
set forth in the Technology Transfer Plan. Payments for each milestone will be
made within [ * ] of satisfactory completion, as determined by JAZZ
PHARMACEUTICALS after review of the associated milestone completion summary
reports discussed in Section 2.2 above and any other data generated through
execution of the Technology Transfer Plan. SIEGFRIED shall not incur any costs
in excess of the amounts set forth in the Technology Transfer Plan without the
prior written consent of JAZZ PHARMACEUTICALS.

2.4 Upon completion of the Technology Transfer Plan and subject to Section 2.5
below, SIEGFRIED shall Manufacture the Active Material in accordance with the
Specifications, cGMP, the Quality Agreement and all applicable Laws. All work
specified hereunder shall be carried out by SIEGFRIED, or a subcontractor
designated by SIEGFRIED in accordance with Section 10.2.

2.5 JAZZ PHARMACEUTICALS shall specify the Manufacturing Commencement Date by
written notice to SIEGFRIED within [ * ] following (i) the approval of SIEGFRIED
as a manufacturer of the Active Material, including approval of the
Manufacturing Site by the FDA, DEA and any other applicable Regulatory
Authority, and (ii) receipt of appropriate Quota. SIEGFRIED will provide all
Manufacturing Services at the Manufacturing Site; provided, however, SIEGFRIED
may transfer the Manufacturing Services to another facility located in the
United States and owned by Siegfried (the “New Manufacturing Site”) upon the
written approval of JAZZ PHARMACEUTICALS, such approval not to be unreasonably
withheld. If SIEGFRIED wishes to transfer the Manufacturing Services to a New
Manufacturing Site, it will provide JAZZ PHARMACEUTICALS with a written request
that indicates the location of the New Manufacturing Site and the proposed
timeline for the transfer of Manufacturing Services to the New Manufacturing
Site. All costs associated with the transfer of the Manufacturing Services to
the New Manufacturing Site, including any costs incurred by JAZZ
PHARMACEUTICALS, will be the sole responsibility of SIEGFRIED. SIEGFRIED will
not be allowed to transfer the Manufacturing Services to the New Manufacturing
Site and JAZZ PHARMACEUTICALS will not have to approve the transfer to the New
Manufacturing Site until (a) approval of the New Manufacturing Site by the FDA,
DEA and any other applicable Regulatory Authority to manufacture the Active
Material and (b) receipt of appropriate Quota for the New Manufacturing Site.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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2.6 From and after the Manufacturing Commencement Date, SIEGFRIED shall perform
the Manufacturing Services set forth on Schedule 3 attached hereto. JAZZ
PHARMACEUTICALS shall purchase at least sixty percent (60%) of its requirements
of Active Material for the Territory from SIEGFRIED. JAZZ PHARMACEUTICALS may
establish other suppliers as additional manufacturers of up to forty percent
(40%) of its requirements of Active Material. If SIEGFRIED, for reasons within
its control, does not, or cannot, meet all of the JAZZ PHARMACEUTICALS’ Firm
Orders (as herein below defined) for the Active Material submitted pursuant to
the terms and conditions of this Agreement, JAZZ PHARMACEUTICALS may purchase
more than forty percent (40%) of its requirements from such manufacturers, but
only to the extent, and only for so long as, SIEGFRIED does not, or cannot, meet
all of the JAZZ PHARMACEUTICALS’ Firm Orders; provided, however, if SIEGFRIED
cannot meet JAZZ PHARMACEUTICALS’ Firm Orders for a period of more than [ * ]
for any reason or reasons not constituting a Force Majeure Event as defined in
Article 13, JAZZ PHARMACEUTICALS will not be obligated to return any portion of
its requirements that it has transferred to another manufacturer back to
SIEGFRIED.

2.7 No later than the [ * ] of each calendar month during the term of the
Agreement, JAZZ PHARMACEUTICALS shall furnish to SIEGFRIED a written rolling [ *
] forecast of JAZZ PHARMACEUTICALS’ anticipated purchases, including shipment
dates, of the Active Material (the “Forecast”). The first [ * ] covered in each
[ * ] Forecast provided shall constitute a firm order (each, a “Firm Order”);
the remaining [ * ] covered by each Forecast shall be a non-binding estimate
only. Each Forecast shall cover a [ * ] forecast period starting the first
(1st) day of the calendar month that is [ * ] in which JAZZ PHARMACEUTICALS
provided such Forecast to SIEGFRIED. By way of example, the Forecast which JAZZ
PHARMACEUTICALS provides by [ * ] shall cover the period from [ * ]. For amounts
of the Active Material set forth in the Forecast, JAZZ PHARMACEUTICALS and
SIEGFRIED realize that the Quota may restrict manufacturing and hence delivery
of shipments throughout the calendar year for which such Quota applies. If the
Quota restricts, or is anticipated to restrict, SIEGFRIED’s ability to meet the
manufacturing requirements set forth in the Forecast, SIEGFRIED will promptly
notify JAZZ PHARMACEUTICALS and the parties will meet and agree on a plan to
resolve the anticipated shortfall in requested Active Material within [ * ].
Each Firm Order shall be in writing and shall specify the Active Material
ordered, the quantity ordered, the price pursuant to Schedule 4 and the required
delivery date, giving SIEGFRIED a lead time of [ * ]. Shorter lead times for
Active Material deliveries, if deemed necessary by JAZZ PHARMACEUTICALS, may be
agreed upon between the Parties in good faith.

2.8 Firm Orders placed with SIEGFRIED by JAZZ PHARMACEUTICALS pursuant to the
provisions of Section 2.7 shall be acknowledged by SIEGFRIED in writing within [
* ] of receipt thereof. SIEGFRIED will use commercially reasonable efforts to
ensure that all Active Material ordered by the JAZZ PHARMACEUTICALS in
accordance with this Agreement will be shipped in accordance with the delivery
dates specified in the JAZZ PHARMACEUTICALS’ Firm Order but in no event shall
the actual delivery date be [ * ] from the date of delivery specified in the
JAZZ PHARMACEUTICALS’ Firm Order, and SIEGFRIED will notify the JAZZ
PHARMACEUTICALS promptly of any significant anticipated delay no later than [ *
] prior to such delivery date.

2.9 The Parties acknowledge that the Active Material is scheduled under the
Federal Controlled Substances Act. SIEGFRIED is required to obtain a Quota from
the DEA before producing the Active Material. In that regard, throughout the
term hereof, SIEGFRIED will submit to DEA in a timely manner all documents
required by the DEA to obtain a Quota sufficient to meet JAZZ PHARMACEUTICALS’
Forecasts made pursuant to Section 2.7. Additional request(s) will be submitted
by SIEGFRIED to DEA in a timely manner as necessary to reflect changes in JAZZ
PHARMACEUTICALS’ Forecasts of Active Material. SIEGFRIED further agrees to use
its commercially reasonable efforts to obtain a Quota from the DEA that allows
SIEGFRIED to manufacture all Forecasts for the Active Material including
cooperating with the JAZZ PHARMACEUTICALS in connection with any discussions
with the DEA regarding a Quota. SIEGFRIED ACKNOWLEDGES THAT TIME IS OF THE
ESSENCE IN PERFORMING ITS OBLIGATIONS UNDER THIS SECTION.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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2.10 SIEGFRIED will use its commercially reasonable efforts to avoid any loss of
Active Material. If and to the extent that Active Material is spilled, scrapped
or otherwise unusable hereunder, SIEGFRIED will dispose of such Active Material
in accordance with applicable regulations and will prepare all necessary
disposal reporting documents and furnish such to DEA in accordance with
applicable regulations and take such steps as are necessary to reclaim such lost
amounts of Active Material for the Quota in the same Quota year any such loss
occurs. In the event of any diversion of Active Material, SIEGFRIED will prepare
all required diversion reports and will provide a copy to JAZZ PHARMACEUTICALS,
if legally permissible, at least [ * ] prior to the filing thereof with the DEA
in accordance with applicable regulations.

2.11 The Active Material ordered by JAZZ PHARMACEUTICALS pursuant to Firm Orders
shall be delivered [ * ] (as per INCOTERMS 2000, made a part hereof by
reference). Risk of loss or of damage to the Active Material ordered by JAZZ
PHARMACEUTICALS pursuant to Firm Orders shall remain with SIEGFRIED until the
Active Material is made available for loading onto the carrier’s vehicle by
SIEGFRIED for shipment at the shipping point at which time risk of loss or
damage shall transfer to JAZZ PHARMACEUTICALS. SIEGFRIED shall, in accordance
with the JAZZ PHARMACEUTICALS’ instructions and as agent for JAZZ
PHARMACEUTICALS, arrange for shipping to be paid by JAZZ PHARMACEUTICALS. JAZZ
PHARMACEUTICALS shall arrange for insurance and shall select the freight carrier
used by SIEGFRIED to ship the Active Material and may monitor SIEGFRIED’s
shipping and freight practices as they pertain to this Agreement. The Active
Material shall be transported in accordance with the Specifications and all
applicable Laws. Notwithstanding the foregoing, there will be no additional
charge by SIEGFRIED for storage for a period of up to [ * ] from the date of
invoice of Firm Orders paid for by JAZZ PHARMACEUTICALS but held for shipment
which Firm Orders do not exceed at any given time [ * ] of the then-current
Forecast; provided however that in no event will such stored Firm Orders exceed
[ * ]. The storage quantities of Active Material in excess of the amounts
provided for in the preceding sentence must be mutually agreed-upon by the
Parties.

2.12 During the term of this Agreement, JAZZ PHARMACEUTICALS shall disclose and
deliver to SIEGFRIED all material information in JAZZ PHARMACEUTICALS’
possession relating to the Manufacture, which may reasonably assist SIEGFRIED in
performing its obligations hereunder.

2.13 In connection with obtaining approval to manufacture the Active Material
and Quota from the DEA, SIEGFRIED will deliver a letter to the DEA authorizing
the DEA to release to JAZZ PHARMACEUTICALS any and all information with respect
to the Active Material that SIEGFRIED has provided directly to the DEA for the
purposes of allowing DEA to communicate with SIEGFRIED regarding Quota in its
capacity as a contract manufacturer for JAZZ PHARMACEUTICALS and to allow DEA to
provide SIEGFRIED with preliminary estimates of the Quota to be issued to
SIEGFRIED. SIEGFRIED will also authorize JAZZ PHARMACEUTICALS to interact
directly with the DEA on SIEGFRIED’s behalf on all matters pertaining to the
Quota and represent the Parties in all meetings with the DEA provided that
SIEGFRIED will be allowed to participate in such meetings if it so desires.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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3. PRODUCT QUALITY

3.1 SIEGFRIED shall take reasonable best precautions and institute effective
procedures to ensure that the Manufacture is and remains fully compliant with
the Quality Agreement, cGMP, the Specifications and all applicable Laws.

3.2 JAZZ PHARMACEUTICALS or its designee shall examine the Active Material
produced by Siegfried within [ * ] of JAZZ PHARMACEUTICALS’ or its designee’s
receipt thereof in order to determine compliance with the Specifications and
cGMP. If, in JAZZ PHARMACEUTICALS’ or its designee’s opinion, the Active
Material delivered does not comply with the Specifications or cGMP, JAZZ
PHARMACEUTICALS shall notify SIEGFRIED within [ * ] after JAZZ PHARMACEUTICALS’
or its designee’s determination made within the aforesaid [ * ] period that the
Active Material delivered does not comply with the Specifications or cGMP (or,
in the case of any Hidden Defects, within [ * ] after discovery by JAZZ
PHARMACEUTICALS) in writing thereof. If JAZZ PHARMACEUTICALS does not notify
SIEGFRIED accordingly within the specified time set forth above, the Active
Material is deemed accepted, provided that JAZZ PHARMACEUTICALS retains the
right to reject the Active Material at a later time in case of Hidden Defects,
in which case JAZZ PHARMACEUTICALS shall inform SIEGFRIED within [ * ] in
writing thereof. Any claims by JAZZ PHARMACEUTICALS regarding Active Material
delivered shall specify in reasonable detail the nature and basis for the claim
and cite SIEGFRIED’s relevant batch numbers or other information to enable
specific identification of the Active Material involved. SIEGFRIED agrees to
review any written claim made by JAZZ PHARMACEUTICALS regarding the quality of
the Active Material and to provide JAZZ PHARMACEUTICALS with the results of such
review in writing within [ * ] of receiving JAZZ PHARMACEUTICALS’ claim. If such
review and testing by SIEGFRIED confirms that a certain quantity of Active
Material did not meet the Specifications, JAZZ PHARMACEUTICALS shall have the
right to reject such Batch of Active Material.

3.3 If the Parties fail to agree as to whether a delivered quantity of Active
Material complies with cGMP and the Specifications at the time of delivery, the
Parties agree to have the Batch in dispute tested and further analysed by an
independent testing laboratory selected by agreement between the Parties. The
decision of the independent testing laboratory shall be deemed final as to any
dispute over Active Material quality. Should the laboratory’s testing determine
that delivered Active Material does not comply with the Specifications or cGMP,
SIEGFRIED shall bear all costs for the independent laboratory testing and JAZZ
PHARMACEUTICALS shall have the right to reject such Batch of Active Material. If
said quantity of Active Material is determined by the independent laboratory to
have met the Specifications and cGMP, then JAZZ PHARMACEUTICALS shall bear all
costs of the independent laboratory testing and compensate SIEGFRIED for the
Batch in question as set out in this Agreement.

3.4 In the event JAZZ PHARMACEUTICALS rejects Product in accordance with
Section 3.2 above and SIEGFRIED does not dispute such rejection, or if the
independent testing laboratory selected by agreement between the Parties in
accordance with Section 3.2 above determines that delivered Active Material does
not comply with the Specifications or cGMP, and the deviation is determined to
arise from SIEGFRIED’s failure to provide the Manufacturing Services in
accordance with Specifications or cGMPs, SIEGFRIED shall promptly, at JAZZ
PHARMACEUTICALS’ election, either: (i) offset such amount against other amounts
due to SIEGFRIED hereunder; or (ii) replace such Active Material with conforming
Active material without JAZZ PHARMACEUTICALS being liable for payment therefor
under Section 6.1 below. Such credit or replacement will be JAZZ
PHARMACEUTICALS’ sole remedy for such rejected Active Material provided
SIEGFRIED provides replacement or credit within [ * ] of notice of rejection or,
in the event of a dispute regarding compliance, within [ * ] of notice the
independent testing laboratory selected by agreement between the Parties in
accordance with Section 3.2 has determined that delivered Active Material did
not comply with the Specifications or cGMP.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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3.5 Each Party shall promptly notify the other party if any Batch of the Active
Material is alleged or proven to be the subject of a recall, market withdrawal
or correction ordered by the FDA or any other Regulatory Authority in the
Territory. The Parties shall cooperate in good faith to handle and dispose of
such recall, market withdrawal or correction; provided, however, that in the
event of a disagreement as to any matters related to such recall, market
withdrawal or correction, JAZZ PHARMACEUTICALS’ decision shall prevail. JAZZ
PHARMACEUTICALS shall bear all the costs of any such recall, market withdrawal
or correction unless such recall, market withdrawal or correction was the result
of SIEGFRIED’S breach of any of its representations and warranties set forth in
Article 11 below, in which case SIEGFRIED shall bear all costs of such recall,
market withdrawal, or correction subject to the limitations set forth in Article
12. If SIEGFRIED asks for a recall and provides written detail regarding the
specific reasons for the request that would be sufficient to justify it to an
individual familiar with the pharmaceutical industry, and JAZZ PHARMACEUTICALS
declines to initiate a recall, SIEGFRIED shall not be liable for any
consequences or damages arising after JAZZ PHARMACEUTICALS has had a period of
time reasonable under the circumstances (which period shall in no event exceed [
* ], and is referred to as the “Evaluation Period”) to assess the requested
recall, and JAZZ PHARMACEUTICALS shall defend, indemnify and hold SIEGFRIED
harmless with respect to any liability arising after the end of the Evaluation
Period and resulting from JAZZ PHARMACEUTICALS’ decision not to initiate a
recall, regardless of any other provisions of this Agreement.

 

4. AUDITS AND INSPECTIONS

4.1 Each party shall forthwith upon execution of this Agreement appoint one of
its employees to be a relationship manager responsible for liaison between the
parties. The relationship managers shall meet not less than quarterly to review
the current status of the business relationship, including, but not limited to,
equipment and facilities updates, current and anticipated manufacturing
capacity, planned work or changes to the Manufacturing Site where the Active
Material is being produced and anticipated shut downs of such site, and manage
any issues that have arisen.

4.2 SIEGFRIED shall keep records of the manufacture, testing and shipping of the
Active Material, and retain samples of such Active Material as are necessary to
comply with the Specifications and all manufacturing regulatory requirements and
Laws applicable to SIEGFRIED, as well as to assist with resolving Active
Material complaints and other similar investigations. Copies of such records and
samples shall be retained for a period of seven (7) years, or longer if required
by Law, after which SIEGFRIED may destroy such records unless JAZZ
PHARMACEUTICALS specifies otherwise in advance.

4.3 JAZZ PHARMACEUTICALS may inspect SIEGFRIED reports and records relating to
this Agreement during normal business hours and with reasonable advance notice,
provided a SIEGFRIED representative is present during any such inspection.
Furthermore, JAZZ PHARMACEUTICALS shall have the right, if JAZZ PHARMACEUTICALS
reasonably deems it necessary, to request additional documentation from
SIEGFRIED to verify SIEGFRIED’s calculation of any pass-through costs and cost
increases.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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4.4 SIEGFRIED shall provide JAZZ PHARMACEUTICALS and its licensees with
reasonable access at mutually agreeable times to its Manufacturing Site in which
the Active Material is manufactured, stored, handled or shipped in order to
permit the JAZZ PHARMACEUTICALS’ and its licensees verification of SIEGFRIED’s
compliance with the Agreement and with all applicable Laws. SIEGFRIED agrees to
permit JAZZ PHARMACEUTICALS or its licensee to review SIEGFRIED’s standard
operating procedures for the manufacture of the Active Material and those
associated with the general facilities, equipment, or procedures required for
compliance with cGMPs or DEA requirements. SIEGFRIED shall use commercially
reasonable efforts to obtain the right for JAZZ PHARMACEUTICALS and its
licensees to have similar inspection rights with respect to all third party
suppliers used by SIEGFRIED to provide components to manufacture the Active
Material. If deficiencies are found by JAZZ PHARMACEUTICALS or its licensees
during the course of such inspections, the Parties will promptly meet to discuss
and resolve them, and JAZZ PHARMACEUTICALS and its licensees will be entitled to
make reasonable follow up inspections to monitor correction of the deficiencies.
SIEGFRIED shall notify JAZZ PHARMACEUTICALS of any inspections by, or
communications with, any governmental agency involving the Active Material.
SIEGFRIED shall furnish to JAZZ PHARMACEUTICALS all material information
supplied to, or supplied by, such Regulatory Authority or third party supplier
to the extent that such report relates to the Active Material, or the ability of
SIEGFRIED to supply such Active Material, within [ * ] of their receipt of such
information or delivery of such information, as the case may be. SIEGFRIED will
promptly correct any deficiencies noted by governmental agencies in any such
inspections. Any licensee of JAZZ PHARMACEUTICALS permitted access to
SIEGFRIED’s Manufacturing Site and records pursuant to this Section 4.4 will be
bound by obligations of confidentiality at least as stringent as those set forth
in Article 7 of this Agreement.

4.5 SIEGFRIED will supply on an annual basis an annual Manufacturing Services
review which includes release test results, complaint test results,
investigations in manufacturing, testing and storage, and the like, that JAZZ
PHARMACEUTICALS reasonably requires in order to complete any filing under any
applicable Law, including any annual product report that the JAZZ
PHARMACEUTICALS is required to file with the FDA. SIEGFRIED will supply JAZZ
PHARMACEUTICALS, no later than [ * ] following the last day of the preceding
month, with a written summary report of the Active Material inventory for such
prior month, in such detail requested and satisfactory to JAZZ PHARMACEUTICALS,
in order that JAZZ PHARMACEUTICALS may properly account for the Active Material
held by SIEGFRIED pursuant to this Agreement. At the JAZZ PHARMACEUTICALS’
request, SIEGFRIED will prepare on behalf of JAZZ PHARMACEUTICALS additional
specialized annual product reports in accordance with the JAZZ PHARMACEUTICALS’
instructions. At the JAZZ PHARMACEUTICALS’ request and expense, SIEGFRIED will
provide the data described in this Section 4.5 on a quarterly basis.

 

5. REGULATORY

5.1 SIEGFRIED shall have the sole responsibility to obtain and maintain any
required local, federal or other permits or approvals, including DEA approval,
to allow SIEGFRIED to perform Manufacturing Services hereunder. JAZZ
PHARMACEUTICALS shall use commercially reasonable efforts to assist SIEGFRIED,
to the extent consistent with JAZZ PHARMACEUTICALS’ obligations under this
Agreement, to obtain FDA and other regulatory approval for the manufacture of
the Active Material by SIEGFRIED as quickly as reasonably possible. Copies of
all relevant Chemistry and Manufacturing Controls (“CMC”) submissions and any
related FDA correspondence are to be provided to SIEGFRIED by JAZZ
PHARMACEUTICALS.

5.2 Prior to filing any CMC-related documents with the FDA or other Regulatory
Authority that incorporate data generated by SIEGFRIED, JAZZ PHARMACEUTICALS
shall provide SIEGFRIED with a copy of the documents incorporating such data so
as to give SIEGFRIED a reasonable opportunity to verify the accuracy and
regulatory validity of such documents as they relate to the SIEGFRIED generated
data.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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5.3 At least [ * ] prior to filing with the FDA the CMC section of a NDA
covering manufacture of the Active Material by SIEGFRIED, JAZZ PHARMACEUTICALS
shall provide SIEGFRIED with a copy of the CMC portion as well as all supporting
documents which have been relied upon to prepare the CMC portion so as to permit
SIEGFRIED to verify that the CMC portion accurately describes the work that
SIEGFRIED has performed and the manufacturing processes that SIEGFRIED will
perform pursuant to this Agreement.

5.4 Subject to Section 5.5 below, if JAZZ PHARMACEUTICALS does not provide
SIEGFRIED with the documentation requested under paragraph (c) above within the
time stipulated in these paragraphs and if SIEGFRIED reasonably believes that
SIEGFRIED’s standing with the FDA may be jeopardized, SIEGFRIED may, in its
reasonable, good faith discretion, delay or postpone the FDA pre-approval
inspection (“PAI”) until such time SIEGFRIED has reviewed the requested
documentation and is satisfied with its contents provided that such review will
be completed within [ * ] of SIEGFRIED’s receipt of such documentation from JAZZ
PHARMACEUTICALS.

5.5 If in SIEGFRIED’s good faith discretion, acting reasonably, SIEGFRIED
determines that any of the information provided by JAZZ PHARMACEUTICALS in
accordance with Sections 5.2 and 5.3 above is inaccurate or deficient in any
material manner (the “Deficiencies”), SIEGFRIED shall notify JAZZ
PHARMACEUTICALS in writing of such Deficiencies within [ * ] of receipt of such
information from JAZZ PHARMACEUTICALS. Failure to notify JAZZ PHARMACEUTICALS
within the applicable period set forth above will constitute SIEGFRIED’s
acceptance of the documentation provided in accordance with Sections 5.2 and 5.3
above. Until such Deficiencies have been resolved or agreement has been reached
with JAZZ PHARMACEUTICALS, SIEGFRIED reserves the right not to participate in
the PAI. In such event, SIEGFRIED’s non-participation in the PAI shall not be
construed as a breach of any of its obligations under this Agreement. Any such
PAI that is delayed shall be rescheduled as soon as reasonably practicable.

 

6. COMPENSATION AND TERMS OF PAYMENT

6.1 In consideration for the supply of the Active Material by SIEGFRIED to JAZZ
PHARMACEUTICALS under the terms of this Agreement, JAZZ PHARMACEUTICALS shall
pay SIEGFRIED the amounts as set out in Schedule 4, subject to such adjustments
as set forth in Section 6.2 below. The fees that are payable by JAZZ
PHARMACEUTICALS for the Active Material as set forth on Schedule 4 are based on
the actual annual volume of Active Material ordered by JAZZ PHARMACEUTICALS in
any Year (“Actual Ordered Product”). The Parties shall estimate the fees payable
by JAZZ PHARMACEUTICALS in any Year based on the Forecasts provided by JAZZ
PHARMACEUTICALS under Section 2.7 above. Within [ * ] of the end of the each
Year, the Parties shall reconcile the difference which may be payable by either
Party based on the Actual Ordered Product for such Year. If the Actual Ordered
Product for such Year is in a tier with a higher cost than that used to
calculate the fees for such Year, JAZZ PHARMACEUTICALS shall pay SIEGFRIED the
difference owed in accordance with Section 6.4 below. If the Actual Ordered
Product for such Year is in a tier with a lower cost than that used by the
Parties to estimate the fees for such Year, SIEGFRIED shall credit or refund, at
JAZZ PHARMACEUTICALS’ option, JAZZ PHARMACEUTICALS for such overpayment.

6.2 On the first day of the applicable Year during the term of this Agreement,
SIEGFRIED shall be entitled to an adjustment to the fees set forth on Schedule 4
(i) for Manufacturing Services in respect of the Active Material other than raw
materials costs (“Conversion Costs”) to reflect increases in manufacturing
costs, which adjustment shall not exceed the increase in the Producers’ Price
Index, Pharmaceuticals Preparations, NAICS 325412 (“PPI”) of the immediately
preceding month compared to the same month of the preceding Year, unless the
parties otherwise agree in writing; and (ii) for raw material costs to pass on
the actual documented amount of any increase or decrease in such costs.
SIEGFRIED will use commercially reasonable efforts to minimize raw material
costs. Notwithstanding the foregoing, if at any time market conditions result in
SIEGFRIED’s cost of raw materials being materially greater than or less than the
raw material costs anticipated for the current Year when pricing was determined
in January of such year, then there shall be an adjustment to the raw material
costs used in the calculation of the fees set forth on Schedule 4 to reflect
such increase or decrease in costs for the period of such material increase or
decrease in costs. For the purpose of this Section 6.2, the threshold for
materially greater than or less than shall be defined as [ * ] for the Active
Material in the relevant Year.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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6.3 For changes to the Specifications or manufacturing processes that are
required by applicable Laws (“Required Manufacturing Changes”), SIEGFRIED and
the JAZZ PHARMACEUTICALS shall cooperate in making such changes and use
commercially reasonable efforts to implement such changes promptly in a manner
that minimizes any effect on the supply hereunder to JAZZ PHARMACEUTICALS of the
Active Material meeting Specifications. All costs associated with Required
Manufacturing Changes directly related to the Manufacturing Site that are not
required solely to permit SIEGFRIED to Manufacture the Active Material shall be
borne by SIEGFRIED. All other costs associated with Required Manufacturing
Changes under this Agreement, including, without limitation, obsolete raw
material, regulatory filings, work in process, equipment and Active Material
shall be borne by JAZZ PHARMACEUTICALS. Amendments to the Specifications or the
Quality Agreement requested by JAZZ PHARMACEUTICALS that are not Required
Manufacturing Changes (“JAZZ PHARMACEUTICALS Requested Changes”) will only be
implemented following a technical and cost review by SIEGFRIED and are subject
to JAZZ PHARMACEUTICALS and SIEGFRIED reaching agreement as to revisions, if
any, to the fees specified in Schedules 4 necessitated by any such amendment.
Amendments to the Specifications, the Quality Agreement or the Manufacturing
Site requested by SIEGFRIED that are not Required Manufacturing Changes
(“SIEGFRIED Requested Changes”) will only be implemented following the approval
of JAZZ PHARMACEUTICALS, such approval not to be unreasonably withheld, and the
costs of the SIEGFRIED Requested Changes will be borne by SIEGFRIED. If JAZZ
PHARMACEUTICALS accepts a proposed fee change, the proposed change in the
Specifications shall be implemented, and the fee change shall become effective
only with respect to those orders of the Active Material that are manufactured
in accordance with the revised Specifications. In addition, with respect to JAZZ
PHARMACEUTICALS Requested Changes, JAZZ PHARMACEUTICALS agrees to purchase, at
SIEGFRIED’s cost therefor (including all costs incurred by SIEGFRIED in
connection with the purchase and handling of such inventory), all Inventory
utilized under the “old” Specifications and purchased or maintained by SIEGFRIED
in order to fill Firm Orders or in accordance with Section 2.7 above, to the
extent that such inventory can no longer be utilized under the revised
Specifications. Open purchase orders for raw materials no longer required under
any revised Specifications that were placed by SIEGFRIED in accordance with this
Agreement with suppliers in order to fill Firm Orders or in accordance with
Section 2.7 shall be cancelled where possible, and where such orders are not
subject to cancellation without penalty, shall be assigned to and satisfied by
JAZZ PHARMACEUTICALS.

6.4 Invoices will be issued by SIEGFRIED and sent to JAZZ PHARMACEUTICALS upon
shipment of the Active Material in accordance with Section 2.11 of this
Agreement. Each such invoice shall, to the extent applicable, identify the JAZZ
PHARMACEUTICALS purchase order number, Active Material quantities, unit price,
freight charges and the total amount to be remitted by JAZZ PHARMACEUTICALS.
JAZZ PHARMACEUTICALS shall pay all such invoices within [ * ] of the date
thereof by wire transfer. Notwithstanding the foregoing, JAZZ PHARMACEUTICALS
may withhold any amounts invoiced by SIEGFRIED that it disputes in good faith.
If JAZZ PHARMACEUTICALS disputes any invoice, JAZZ PHARMACEUTICALS shall within
[ * ] after such invoice is furnished to it notify SIEGFRIED that it disputes
the accuracy or appropriateness of such invoice and specify the particular
respects in which such invoice is inaccurate or inappropriate. JAZZ
PHARMACEUTICALS and SIEGFRIED will make good faith efforts to resolve any
disputes within [ * ] thereafter. Any amounts that are disputed by JAZZ
PHARMACEUTICALS shall not be due until [ * ] following the resolution of such
dispute.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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6.5 The Parties agree that, unless set out otherwise in this Agreement, all
payments made to SIEGFRIED pursuant to this Agreement shall be non-refundable
and that the expiration or termination of this Agreement shall not relieve JAZZ
PHARMACEUTICALS of its obligation to pay any outstanding balances due.

 

7. CONFIDENTIAL INFORMATION

7.1 Each Party agrees to retain in strict confidence and not to disclose,
divulge or otherwise communicate to any third party or entity any Confidential
Information of the other Party (or its Affiliate), whether disclosed prior to,
or after the date of signature of this Agreement or of prior secrecy agreements.
The Parties further agree not to use any such Confidential Information for any
other purpose, except pursuant to, and in order to carry out, the terms and
objectives of this Agreement, except that each Party may disclose Confidential
Information of the other Party to its (or its Affiliate’s) officers, directors,
employees, agents, consultants, subcontractors or representatives (the “Entitled
Persons”), who, in each case, need to know such information for purposes of the
implementation and performance by the Receiving Party of this Agreement, who
will use the Information only for such limited purposes and who are bound by
obligations of confidentiality at least as stringent as those set forth in this
Agreement.

7.2 Each Party agrees to use with respect to Confidential Information of the
other Party at least the same standard of care as it uses to protect proprietary
or confidential information of its own of comparable sensitivity and to exercise
every reasonable precaution to prevent and restrain the unauthorized disclosure
of such Confidential Information by any of its Entitled Persons.

7.3 Each Party warrants that each of its Entitled Persons to whom any
Confidential Information is revealed shall previously have been informed of the
confidential nature of the Confidential Information and shall be under
professional secrecy or shall have agreed to be bound by the terms and
conditions of this Article 6 or by confidentiality obligations equal to this
Article 6.

7.4 The provisions of this Article 7 shall not apply to any Confidential
Information disclosed hereunder which was either (a) independently developed or
known by the Receiving Party prior to its disclosure to the Receiving Party by
the Disclosing Party, as evidenced by written records; or (b) before or after
the date of disclosure to the Receiving Party by the Disclosing Party is in the
public domain or lawfully disclosed to the Receiving Party by an independent,
unaffiliated third party rightfully in possession of the Confidential
Information and not under any confidentiality obligation towards the Disclosing
Party with regard to such Confidential Information; or (c) is required to be
disclosed by the Receiving Party to the officials of a Regulatory Authority or
to comply with applicable laws, to defend or prosecute litigation or to comply
with governmental laws or regulations, judicial orders or valid subpoenas,
provided that the Receiving Party provides prior written notice of such intended
disclosure to the Disclosing Party and takes reasonable and lawful actions to
avoid and/or minimize the degree of such disclosure. The burden of proof lies
with the Party alleging one of the above exceptions. Nonetheless, such Party
shall not disclose that the same Confidential Information was also acquired from
the other Party.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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7.5 Except as otherwise provided for under this Agreement, nothing herein shall
be construed as giving either Party any right, title or interest in or ownership
of the Confidential Information of the other Party. For the purposes of this
Agreement, specific information disclosed as part of the Confidential
Information shall not be deemed to be in the public domain or in prior
possession of the Receiving Party merely because it is embraced by more general
information in the public domain or by more general information in the prior
possession of the Receiving Party.

7.6 Except as may be required by law or regulation, or in response to a valid
subpoena or other judicial order, neither Party shall disclose the terms of this
Agreement without the prior written consent of the other Party, which consent
shall not be unreasonably withheld, except that the Parties may disclose the
terms of this Agreement to the Parties’ or third parties’ accountants and
attorneys, provided any such attorney or accountant receiving information
concerning the terms of this Agreement is either bound by professional secrecy
or agrees to be bound by confidentiality obligations equal to this Article 7
with respect to such information.

7.7 The confidentiality obligations of the Parties contained in this Article 7
shall remain binding upon both Parties during the term of this Agreement and for
a period of ten (10) years after the termination or expiry of this Agreement,
regardless of the cause of such termination. The Parties acknowledge that any
breach of this Article 7 will constitute irreparable harm, and that the
non-breaching Party shall be entitled to specific performance or injunctive
relief to enforce this Article 6 in addition to whatever remedies such Party may
otherwise be entitled to at law or in equity.

 

7.8 The confidentiality provisions of this Agreement extend to the Parties and
their Affiliates.

 

8. INTELLECTUAL PROPERTY

8.1 SIEGFRIED hereby assigns, releases, and transfers to JAZZ PHARMACEUTICALS
its entire right, title and interest in and to any invention, discovery or
improvement to the extent it is specific to the development, manufacture and use
of the Active Material that is the subject of the Manufacturing Services
(whether patentable or not) made or conceived by SIEGFRIED’s employees or
contractors, including, without limitation, manufacturing, manufacturing
processes and procedures, analytical process, procedure or method, analytical
results, and any route(s) of synthesis provided, however, JAZZ PHARMACEUTICALS
hereby grants to SIEGFRIED a paid-up, worldwide, nonexclusive, nontransferable
license to use patented inventions, discoveries, or improvements solely for
purposes of providing Manufacturing Services pursuant to this Agreement.

8.2 JAZZ PHARMACEUTICALS shall own all right, title and interest in and to any
Intellectual Property specific to the development, manufacture and use of the
Active Material (whether patentable or not) made or conceived by JAZZ
PHARMACEUTICALS employees or by any JAZZ PHARMACEUTICALS contractor, including,
without limitation, any manufacturing or analytical process, procedure or method
or any source of synthesis given to SIEGFRIED.

8.3 All Intellectual Property generated or derived by SIEGFRIED in the course of
performing the Manufacturing Services which are not related to or derived from
the JAZZ PHARMACEUTICALS’ Intellectual Property or specific to, or dependent
upon, the Active Material and which have general application to manufacturing
processes or formulation development of drug product or drug delivery systems
shall be the exclusive property of SIEGFRIED (the “SIEGFRIED Intellectual
Property Rights”). SIEGFRIED hereby grants to JAZZ PHARMACEUTICALS, a
non-exclusive, paid-up, royalty-free, transferable license of the SIEGFRIED
Intellectual Property Rights which JAZZ PHARMACEUTICALS may use for the
manufacture of the Active Material pursuant to this Agreement.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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8.4 SIEGFRIED shall promptly disclose to JAZZ PHARMACEUTICALS any and all
inventions, discoveries and improvements specific to the development,
manufacture and use of the Active Material (collectively “Inventions”), by
SIEGFRIED’s employees or contractors, either alone or together with JAZZ
PHARMACEUTICALS’ employees or contractors, and shall assign all its interests to
JAZZ PHARMACEUTICALS or its designee in accordance with Section 8.1. SIEGFRIED
shall execute at JAZZ PHARMACEUTICALS’ expense any assignments, applications or
other instruments or documents reasonably requested by JAZZ PHARMACEUTICALS in
accordance with this Article 8 and, at JAZZ PHARMACEUTICALS’ expense, give
testimony which shall be deemed necessary to apply for and obtain Letters Patent
of the United States or of any other country and otherwise to perfect JAZZ
PHARMACEUTICALS’ interest therein. SIEGFRIED’s and JAZZ PHARMACEUTICALS’
obligations hereunder shall survive termination of this Agreement.

 

9. TERM AND TERMINATION

9.1 Subject to earlier termination pursuant to this Article 9 or as stipulated
for elsewhere in this Agreement, this Agreement shall become effective on the
date when signed by the second Party and continue in full force and effect for
an initial period of five (5) years (hereinafter “Initial Period”), to be
automatically renewed for three (3) year periods at a time, subject to the right
of either Party to terminate this Agreement at any time at the end of the
Initial Period or any subsequent three (3) year period with at least eighteen
(18) months prior written notice to the other Party.

9.2 Either Party at its sole option may immediately terminate this Agreement
upon written notice, but without prior advance notice, to the other Party in the
event that: (i) the other Party is declared insolvent or bankrupt by a court of
competent jurisdiction; (ii) a voluntary petition of bankruptcy is filed in any
court of competent jurisdiction by such other Party; or (iii) this Agreement is
assigned by such other Party for the benefit of creditors.

9.3 Either Party at its sole option may terminate this Agreement upon written
notice in circumstances where the other Party has failed to remedy a material
breach of any of its representations, warranties or other obligations under this
Agreement within [ * ] following receipt of a written notice (the “Remediation
Period”) of said breach that expressly states that it is a notice under this
Section 9.3 (a “Breach Notice”). The aggrieved Party’s right to terminate this
Agreement pursuant to this Section 9.3 may only be exercised for a period of [ *
] following the expiry of the Remediation Period (in circumstances where the
breach has not been remedied) and if the termination right is not exercised
during this period then the aggrieved Party shall be deemed to have waived the
breach of the representation, warranty or obligation described in the Breach
Notice; provided, however, that such waiver shall only apply to the specific
occurrence of the breach described in the Breach Notice.

9.4 JAZZ PHARMACEUTICALS may terminate this Agreement at any time on or after
December 31, 2011 upon [ * ] notice if SIEGFRIED has not (i) obtained approval
as a manufacturer of the Active Material, including approval of SIEGFRIED’s
facility by the FDA, DEA and any other applicable Regulatory Authority or
(ii) obtained a Quota for the Active Material for calendar year 2011.

9.5 JAZZ PHARMACEUTICALS may terminate this Agreement upon [ * ] prior written
notice if it intends to no longer order the Active Material due to its decision
to discontinue the use of the Active Material in its commercial pharmaceutical
products.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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9.6 If this Agreement expires or is terminated for any reason (including a
termination in the event of a Force Majeure Event), then (in addition to any
other remedies either Party may have in the event of default by the other
Party):

 

  (a) subject to the terms of the Agreement, the JAZZ PHARMACEUTICALS shall take
delivery of and pay for all undelivered Active Material (i) (A) that is
manufactured pursuant to a Firm Order and (B) that meets the Specifications and
(C) was manufactured in accordance with the Quality Agreement and cGMPs at the
price in effect at the time the Firm Order was placed and (ii) all raw materials
identified to the Active Material acquired or produced by SIEGFRIED in good
faith reliance on the Forecasts delivered by JAZZ PHARMACEUTICALS hereunder;

 

  (b) SIEGFRIED shall continue to provide manufacturing and quality assurance
support and support of the stability studies for the Active Material until the
expiration date of the last production Batch of the Active Material purchased by
JAZZ PHARMACEUTICALS hereunder or the date required by any applicable Law or
Regulatory Authority in the Territory, whichever is later, provided, however, if
JAZZ PHARMACEUTICALS terminates this Agreement other than pursuant to
Section 9.2 or 9.3, JAZZ PHARMACEUTICALS shall reimburse SIEGFRIED for the
actual costs of any required support of the stability studies;

 

  (c) SIEGFRIED shall take all steps reasonably requested by JAZZ
PHARMACEUTICALS to confirm the assignment to JAZZ PHARMACEUTICALS all of
SIEGFRIED’s right, title and interest in the Inventions, including, without
limitation, to execute or cause its employees or contractors to execute such
documents as may be reasonably requested by JAZZ PHARMACEUTICALS to vest all
such right, title and interest in such Inventions in JAZZ PHARMACEUTICALS,
provided JAZZ PHARMACEUTICALS shall pay all reasonable expenses, including any
of time and travel of SIEGFRIED’s employees, in connection with steps; and

 

  (d) Each Party shall return to the other party any Confidential Information of
the other Party except for one (1) archival copy as may be required for purposes
of compliance with any FDA regulation or other applicable Law or Regulatory
Authority in the Territory.

Any termination or expiration of this Agreement shall not affect any outstanding
obligations or payments due hereunder prior to such termination or expiration,
nor shall it prejudice any other remedies that the parties may have under this
Agreement.

9.7 The provisions of Articles 1, 7, 8, 11, 12, 16, 18, 19 and 20, and Sections
4.2, 9.6 and 9.7 shall survive the termination of this Agreement for any reason.

 

10. ASSIGNMENT AND SUBCONTRACTING

10.1 This Agreement is binding upon and shall inure to the benefit of the
Parties hereto and their successors and permitted assigns. This Agreement and
any rights or obligations hereunder may be assigned or delegated only (i) with
the consent of the other Party, or (ii) to the successor to all or substantially
all of the business of a Party (whether by merger, consolidation, asset transfer
or similar transaction) to which this Agreement relates, or (iii) to an
Affiliate of either Party. Any other assignment or delegation by either Party
without the prior written consent of the other Party is void.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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10.2 SIEGFRIED is not entitled to engage any subcontractor for conducting the
work under this Agreement without the prior written consent of JAZZ
PHARMACEUTICALS provided such subcontractor agrees in writing to all the terms
and conditions of this agreement including the terms of Article 16 below. If a
subcontractor is appointed, SIEGFRIED shall be responsible for all work
performed by such subcontractor as if performed by itself.

 

11. REPRESENTATIONS AND WARRANTIES

11.1 Warranties by Each Party. Each of JAZZ PHARMACEUTICALS and SIEGFRIED hereby
represents, warrants and covenants to the other Party as follows:

 

  (a) it is a corporation duly organized and validly existing under the laws of
the state or other jurisdiction in which it is incorporated;

 

  (b) the execution, delivery and performance of this Agreement by such Party
has been duly authorized by all requisite corporate action;

 

  (c) it has the power and authority to execute and deliver this Agreement and
to perform its obligations hereunder;

 

  (d) the execution, delivery and performance by such Party of this Agreement
and its compliance with the terms hereof does not and will not conflict with or
result in a breach of any term of, or constitute a default under (i) any
agreement or instrument binding or affecting it or its property; (ii) its
charter documents or bylaws; or (iii) any order, writ, injunction or decree of
any court or governmental authority entered against it or by which any of its
property is bound;

 

  (e) subject in the case of SIEGFRIED to the receipt of the Quota, it has
obtained any consent, approval or authorization of, or notice, declaration,
filing or registration with, any governmental or Regulatory Authorities required
for the execution, delivery and performance of this Agreement by such Party, and
the execution, delivery and performance of this Agreement will not violate any
law, rule or regulation applicable to such Party;

 

  (f) this Agreement has been duly executed and delivered and constitutes such
Party’s legal, valid and binding obligation enforceable against it in accordance
with its terms subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or affecting
creditors’ rights and to the availability of particular remedies under general
equity principles; and

 

  (g) it shall comply with all applicable Laws, rules and regulations relating
to its activities under this Agreement.

 

11.2 Warranties by SIEGFRIED. SIEGFRIED represents, warrants and covenants to
JAZZ PHARMACEUTICALS that:

 

  (a) all Active Material delivered to JAZZ PHARMACEUTICALS or its designated
Affiliates pursuant to this Agreement shall conform at the time of delivery with
cGMP, applicable Laws and the Specifications and that such Active Material shall
be manufactured in accordance with Article 2 hereof and the Quality Agreement;

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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  (b) to its knowledge, no third party patents, copyrights, trademarks, trade
secrets or other third party intellectual property rights will be infringed by
SIEGFRIED’s performance of its obligations under this Agreement;

 

  (c) it will not use in any capacity, in connection with the Manufacturing
Services to be performed under this Agreement, the services of any person
debarred or suspended under 21 U.S.C. §335(a) or (b). SIEGFRIED represents that
it does not currently have, and covenants that it will not hire, as an officer
or an employee any person who has been convicted of a felony under the laws of
the United States for conduct relating to the regulation of any drug product
under the Act; and

 

  (d) at the time of its delivery at the Manufacturing Site, each Batch of the
Active Material manufactured by SIEGFRIED will: (i) have an expiration date at
the time of shipment equal to that approved by the FDA, (ii) conform to the
Specifications and will be stored under proper conditions; and (iii) not be
adulterated or misbranded by SIEGFRIED within the meaning of the Act, or be an
article which may not be introduced into interstate commerce under Sections 404
or 505 of such Act.

11.3 EXCEPT AS EXPRESSLY WARRANTED IN THIS AGREEMENT, SIEGFRIED EXTENDS NO OTHER
WARRANTIES OR REPRESENTATIONS COVERING THE PRODUCT, EXPRESS OR IMPLIED, AND
SIEGFRIED EXPRESSLY DISCLAIMS ALL IMPLIED WARRANTIES, INCLUDING THE WARRANTY OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. SIEGFRIED’S LIABILITY
UNDER THESE WARRANTY PROVISIONS SHALL BE STRICTLY LIMITED TO THE REMEDIES
PROVIDED FOR UNDER THIS AGREEMENT.

 

12. LIABILITY AND INDEMNITY

12.1 Indemnification by JAZZ PHARMACEUTICALS. Subject to SIEGFRIED ’s compliance
with its obligations in Section 12.3 hereof, JAZZ PHARMACEUTICALS hereby
indemnifies, defends, and holds SIEGFRIED and its directors, officers,
employees, agents and Affiliates harmless against any and all claims, losses,
damages, expenses, reasonable attorneys’ fees (regardless of outcome),
settlement costs and judgments (a) to which SIEGFRIED may be subject with
respect to the Active Material or any Finished Dosage Form, (b) arising out of
or resulting from any Finished Dosage Form or any other subsequent formulation,
repackaging, distribution or other use of the Active Material supplied
hereunder, including third party liability claims relating thereto. or
(c) relating to or arising from any claim that the Manufacturing Services
infringed a patent, copyright, trademark, trade secret or other intellectual
property right of a third party, except to the extent that such losses, damages,
expenses, fees, settlement costs or judgments result from (i) the breach by
SIEGFRIED of its representations or warranties under Article 11 or (ii) the
gross negligence or willful misconduct of SIEGFRIED, its employees or agents.

12.2 Indemnification by SIEGFRIED. Subject to JAZZ PHARMACEUTICALS’ compliance
with its obligations in Section 12.3 hereof, SIEGFRIED hereby indemnifies,
defends, and holds JAZZ PHARMACEUTICALS and its directors, officers, employees,
agents, and Affiliates harmless against any and all losses, damages, expenses,
reasonable attorneys’ fees (regardless of outcome), settlement costs and
judgments arising out of or resulting from (a) SIEGFRIED’s breach of any of its
representations or warranties under Article 11 above, including, but not limited
to, development, manufacture, testing, shipping, storage, delivery and/or other
handling or processing of the Active Material (except for a breach arising from
the noncompliance of Active Material with the Specifications or cGMP, for which
case the sole remedy shall be as prescribed in Section 3.4), (b) SIEGFRIED’s
gross negligence or willful misconduct or (c) any injuries or claims of injuries
which occur at the Manufacturing Site in connection with the Manufacturing
Services, except to the extent that such losses, damages, expenses, fees,
settlement costs or judgments result from (i) the breach by JAZZ PHARMACEUTICALS
of its representations or warranties under Article 11 or (ii) the gross
negligence or willful misconduct of JAZZ PHARMACEUTICALS, its employees or
agents.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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12.3 Conditions to Indemnification. The indemnified Party shall give the
indemnifying Party prompt written notice of any claim or the institution of any
suit against the indemnified Party for which it may seek indemnification under
this Article 12. The failure to give such notice shall not relieve the
indemnifying Party from any liability that it may have to the indemnified Party
under this Article 12, except to the extent that the indemnifying Party’s
ability to defend such claim or suit is materially prejudiced by such failure to
give notice. The indemnifying Party shall be entitled to participate in the
defense of such claim or suit and to assume the control of such defense;
provided, however, that the indemnified Party may elect to participate in, but
not control, the defense of such claim or suit and to be represented by counsel,
at its own expense, in connection therewith. The indemnifying Party shall not
enter into any settlement agreement, which would materially adversely affect the
rights or obligations of the indemnified Party under this Agreement without the
indemnified Party’s prior written consent.

12.4 Limitation of Liability. Except in the case of SIEGFRIED’s gross negligence
or wilful misconduct, SIEGFRIED’s total liability for any damages of any kind or
nature (including any liability relating to a recall, market withdrawal or
correction) shall not exceed in a Year the amount equal to [ * ].

12.5 EXCEPT WITH RESPECT TO AMOUNTS PAYABLE TO THIRD PARTIES, NEITHER PARTY
SHALL BE RESPONSIBLE TO THE OTHER PARTY FOR SUCH OTHER PARTY’S LOST PROFITS OR
INCIDENTAL OR CONSEQUENTIAL DAMAGES, INCLUDING LOSS OR DAMAGE TO GOODWILL OR
REPUTATION.

12.6 Debarment Certification. In accordance with the requirements of the Act,
SIEGFRIED certifies that, to the best of its knowledge, SIEGFRIED is not and
will not be using any person presently under investigation by the FDA for
debarment action, or debarred under 21 U.S.C § 335a, in any capacity, in
connection with the manufacture of Active Material. SIEGFRIED also certifies
that, to the best of its knowledge, SIEGFRIED is not and will not be using any
person or Affiliate for whom convictions subject to debarment have occurred in
the last five (5) years in any capacity in connection with the manufacture of
Active Material. If, at any time after execution of this Agreement, SIEGFRIED
becomes aware that SIEGFRIED is using any person or any Affiliate that has been
or is in the process of being debarred, SIEGFRIED hereby certifies that it will
promptly notify JAZZ PHARMACEUTICALS of such.

12.7 Without limiting their obligations hereunder, both Parties shall maintain
at their individual sole expense, commencing with the Effective Date and
continuing throughout the term and any renewals thereof, sufficient insurance
coverage to satisfy their obligations hereunder. Without derogating from the
foregoing, this shall include, at minimum, the following insurance:
(i) commercial general liability insurance, including broad form contractual
liability and personal/ advertising injury coverage, with limits of not less
than US $5,000,000 per occurrence and US $5,000,000 annual aggregate;
(ii) product liability insurance with a coverage limit of not less than
US $5,000,000 per occurrence and US $ 10,000,000 annual aggregate (iii) with
respect to SIEGFRIED, workers compensation insurance with not less than minimum
coverage limit as required by law; employers liability insurance of not less
than $1,000,000 per accident/injury. The required limits for general liability
and product liability may be satisfied through a combination of primary and
umbrella coverage. Both Parties agree to endeavor to provide [ * ] notice of
cancellation or non-renewal of required insurance. Prior to the performance of
any activities under this Agreement, each Party shall provide the other with a
certificate of insurance evidencing its respective insurance coverage. Required
insurance shall be placed with carriers having a minimum A.M. Best rating of A-
or better. If any required insurance is written on a claims-made basis, the
policy holder/named insured shall be responsible for ensuring continuity of
cover for claims which may be presented following policy expiry or cancellation.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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13. FORCE MAJEURE

Either Party shall be excused from performing its obligations under this
Agreement if its performance is delayed or prevented by any cause beyond such
Party’s control, including but not limited to, act of God, fire, explosion,
weather, disease, war, insurrection, civil strike, riots, labor strike,
slow-downs or similar labor disturbances, power failure or energy shortages
(“Force Majeure Event”) or a Force Majeure Event affecting a raw material
supplier. Performance shall be excused only to the extent of and during the
reasonable continuance of such disability. Any deadline or time for performance
specified in this Agreement that falls due during or subsequent to the
occurrence of any of the disabilities referred to herein shall be automatically
extended for a period of time equal to the period of such disability. SIEGFRIED
shall immediately notify JAZZ PHARMACEUTICALS if, by reason of any Force Majeure
Event referred to herein, SIEGFRIED is unable to meet any deadline or time for
performance specified in this Agreement. In the event that such Force Majeure
Event cannot be removed or overcome within [ * ] (or such other period as the
Parties jointly shall determine) from the date the Party affected first became
affected, then either Party may, at any time after the expiration of such
period, and for so long as such Force Majeure Event continues to exist, by
written notice to the other Party, suspend or terminate this Agreement.

 

14. INDEPENDENT PARTIES

Nothing herein, or in any attachments hereto, shall be deemed or construed to
constitute or create between the Parties hereto a partnership, joint venture,
agency, or other relationship other than as expressly set forth herein. Neither
of the Parties shall be responsible for the acts or omissions of the other
Party, and neither Party will have authority to speak for, represent or obligate
the other Party in any way without prior written authority from the other Party.

 

15. ENTIRE AGREEMENT AND LEGAL AUTHORITY

15.1 This Agreement and the Schedules attached hereto (which Schedules are
deemed to be an integral part of this Agreement for all purposes) contain the
full understanding of the Parties with respect to the subject matter hereof and
supersede all prior understandings and writings relating thereto. No waiver,
alteration or modification of any of the provisions hereof shall be binding
unless made in writing and signed by the Parties.

15.2 Each Party represents and warrants to the other that it has the legal
power, authority and right to enter into this Agreement and to perform its
respective obligations set forth herein. This Agreement has been duly executed
and delivered by each Party and constitutes the valid and binding obligation of
such Party, enforceable against such Party in accordance with its terms.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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15.3 If any portion of this Agreement is held invalid by a court of competent
jurisdiction, such portion shall be deemed to be of no force and effect and the
Agreement shall be construed as if such portion had not been included herein,
provided however, if the deletion of such provision materially impairs the
commercial value of this Agreement to either Party, the Parties shall attempt to
renegotiate such provision in good faith. The fact that any provision of this
Agreement shall be prohibited or unenforceable in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction. To
the extent permitted by applicable law, the Parties to this Agreement waive any
provision of law that renders any provision of this Agreement prohibited or
unenforceable in any respect.

15.4 This Agreement may be executed in counterparts, each of which shall be
deemed an original, but all of which together shall constitute but one and the
same Agreement.

 

16 EXCLUSIVITY

During the term of this Agreement and, except in the case of a termination by
SIEGFRIED pursuant to Sections 9.2 or 9.3 or a termination by JAZZ
PHARMACEUTICALS pursuant to Sections 9.4 or 9.5, for eighteen (18) months
thereafter, SIEGFRIED will not develop, make, have made, use, sell, have sold,
offer for sale, import or commercialize, or assist any other third party, in any
of the foregoing with respect to the Active Material other than JAZZ
PHARMACEUTICALS pursuant to this Agreement.

 

17. PRECEDENCE OF AGREEMENT, WAIVERS AND FURTHER ASSURANCES

17.1 Unless expressly agreed otherwise in writing the terms outlined in this
Agreement shall prevail over any terms and conditions outlined in any Firm Order
or Firm Order confirmation for Active Material or any general terms and
conditions of either Party, and such terms and conditions are hereby expressly
excluded.

17.2 In case of conflicts between this Agreement and a Schedule hereto the
provisions of this Agreement shall prevail. In case of conflicts between this
Agreement and the Quality Agreement the provisions of this Agreement shall
prevail.

17.3 The failure by either Party at any time to enforce any of the terms,
provisions or conditions of this Agreement or to exercise any right hereunder
shall not constitute or be construed to constitute a waiver of the same or
affect that Party’s rights thereafter to enforce or exercise the same. No waiver
of any term, provision or condition of this Agreement shall be effective unless
it is in writing and signed by duly authorised persons on behalf of the waiving
Party.

17.4 Each Party agrees to execute, acknowledge and deliver such further
instruments, and to take such further actions, as may be necessary or
appropriate in order to carry out the purpose and intent of this Agreement.

 

18. NO PUBLICITY

Neither JAZZ PHARMACEUTICALS nor SIEGFRIED shall use the name of the other Party
in any advertising or press release without the prior consent of the other
Party; provided that this Article 18 shall not restrict JAZZ PHARMACEUTICALS
from identifying SIEGFRIED and its work in connection with this Agreement to any
Regulatory Authority or as required by law or regulation.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

- 21 -

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19. NOTICES

Any notice required under this Agreement shall be effective only if it is in
writing and (i) delivered in person or (ii) deposited with a nationally
recognized overnight delivery service, or (iii) sent by registered mail or
(iv) dispatched by fax with copy of receipt, in which case such notice is to be
confirmed by registered mail within [ * ]; in either case any notice is to be
addressed to the applicable address set forth below or any other address as
designated by either Party.

All notices or demands to be given between the Parties under this Agreement
shall be addressed as follows:

if to SIEGFRIED:

Siegfried (USA) Inc

33 Industrial Park Road

Pennsville, NJ 08070

Attention: [ * ]

(Fax): [ * ]

if to JAZZ PHARMACEUTICALS:

Jazz Pharmaceuticals, Inc.

3180 Porter Drive

Palo Alto, CA 94304

Attention: President

(Fax): [ * ]

With a copy to:

Jazz Pharmaceuticals, Inc.

3180 Porter Drive

Palo Alto, CA 94304

Attention: General Counsel

(Fax): [ * ]

Either Party may change the above addresses, but no such change shall have any
effect until the other Party has been properly notified of the change as set out
hereinabove.

 

20. GOVERNING LAW AND DISPUTE RESOLUTION

20.1 Governing Law. This Agreement is to be governed by and construed in
accordance with the laws of the State of New York, without giving effect to
conflict of law principles. The Parties agree that the United Nations Convention
on Contracts for the International Sale of Goods shall not apply to this
Agreement.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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20.2 Formal Dispute Resolution. In the event a dispute arises under this
Agreement that can not be resolved by those with direct responsibility for the
matter in dispute, such dispute shall be resolved by way of the following
process:

(a) Management from JAZZ PHARMACEUTICALS and from SIEGFRIED shall meet to
discuss the basis for the dispute and shall use their best efforts to reach a
reasonable resolution to the dispute.

(b) If management fails to resolve the dispute within [ * ] of its receipt of
written notice of the dispute, the matter in dispute shall be brought to the
attention of senior management at JAZZ PHARMACEUTICALS and SIEGFRIED. Said
management shall meet in person to negotiate a good faith resolution to the
dispute within [ * ] of their receipt of written notice of the dispute.

(c) If such negotiations are unsuccessful, the matter may promptly be submitted
by either party to and settled exclusively by arbitration in accordance with the
Commercial Arbitration Rules, then in effect, of the American Arbitration
Association (“AAA”), except to the extent modified herein or by agreement of the
parties. Judgment on the award rendered may be entered in any court having
jurisdiction thereof.

(d) Each Party shall, within [ * ] of receipt of notice that the matter has been
referred to arbitration, appoint one arbitrator pursuant to a procedure to be
agreed upon by the parties and shall commence arbitration as soon as practicable
thereafter. Such appointed arbitrators shall jointly select a third arbitrator.
The arbitrators shall not be empowered to award punitive or exemplary damages.

(e) Notwithstanding any provision to the contrary in the Rules, the Parties
hereby stipulate that any arbitration hereunder shall be subject to the
following special rules: (i) the arbitrators may require either Party to
specifically perform its obligations under this Agreement and (ii) each Party
shall bear its own costs and expenses of the arbitration and one-half (1/2) of
the fees and costs of the arbitrators, subject to the power of the arbitrators,
in their sole discretion, to award all such reasonable costs, expenses and fees,
including, without limitation, attorney’s fees, to the prevailing Party.

(f) Notwithstanding any other provision of this Agreement, each Party shall
still be entitled to access the courts to obtain appropriate injunctive relief.

(h) During the pendency of any dispute resolution procedure pursuant to this
Section, the effectiveness of any notice of termination given pursuant to
Section 9 shall be suspended.

(i) All mediations and arbitrations pursuant to this Agreement shall take place
in the City of New York, New York, U.S.A. in the English Language.

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

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IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed
in duplicate by their duly authorized representatives.

 

SIEGFRIED (USA) INC.       Date: April 1, 2010     April 5, 2010 By:  

/s/ Walter Kittl

    By:  

/s/ Sandra Cernick

Name:  

Walter Kittl

    Name:  

Sandra Cernick

Title:  

General Manager

    Title:  

Director, Business Development

 

JAZZ PHARMACEUTICALS, INC. Date: April 8, 2010 By:  

/s/ Janne Wissel

Name:  

Janne Wissel

Title:  

SVP, Chief Regulatory Officer

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

- 24 -

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List of Schedules

 

Schedule

  

Description

  

Content

1    Specifications    Details and technical description of Active Material 2   
Baseline Technology Transfer Plan    Milestones, Cost, Assumptions, Timeline,
Payment Terms 3    Manufacturing Services    Description of services to be
provided by SIEGFRIED 4    Commercial Pricing    Purchase prices for Active
Material

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

--------------------------------------------------------------------------------

SCHEDULE 1

Specifications

[ * ]

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

--------------------------------------------------------------------------------

SCHEDULE 2

Baseline Technology Transfer Plan

[ * ]

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

--------------------------------------------------------------------------------

SCHEDULE 3

Manufacturing Services

[ * ]

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.

--------------------------------------------------------------------------------

SCHEDULE 4 – COMMERCIAL PRICING

[ * ]

849150 v3/HN

 

[ * ] = Certain confidential information contained in this document, marked by
brackets, has been omitted and filed separately with the Securities and Exchange
Commission pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as
amended.