Exhibit 10.3


 


CERTAIN CONFIDENTIAL PORTIONS OF THIS
EXHIBIT HAVE BEEN OMITTED AND REPLACED WITH “[***]”. SUCH IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT
BECAUSE IT IS (I) NOT MATERIAL AND (II) WOULD LIKELY CAUSE COMPETITIVE HARM TO THE COMPANY IF DISCLOSED.


 


AMENDMENT TO ROYALTY INTEREST ACQUISITION
AGREEMENT


 


AMENDMENT, dated as of June 8, 2020 (this
 “Amendment”), to the Royalty Interest Acquisition Agreement, dated as of December 28, 2017 (the “Acquisition
Agreement”), by and among Elobix AB, a limited liability company organized under the laws of Sweden, (“Seller”),
HealthCare Royalty Partners III, L.P., a limited partnership organized under the laws of the State of Delaware (“Buyer”)
and, solely for the purposes of Section 5.08, Section 5.09 and Article VIII, Albireo Pharma, Inc. a Delaware
corporation (“Seller Parent”). Capitalized terms used but not otherwise defined herein shall have the meanings
ascribed thereto in the Acquisition Agreement.


 


WHEREAS, Buyer, Seller and Seller Parent desire
to amend certain of the provisions of the Acquisition Agreement in accordance with Section 8.07(a) of the Acquisition Agreement
to address certain revisions and additional agreements among the Parties and an additional investment by Buyer;


 


NOW THEREFORE, in consideration of the mutual
covenants, agreements representations and warranties set forth herein, the Parties agree as follows:


 


		1.	Amendments. Effective upon the Additional Investment Closing,



 


		(a)	the Acquisition Agreement shall be amended as follows:



 


		(i)	Section 1.01 of the Acquisition Agreement shall be amended by removing and deleting in their entirety the following terms:
 “Cap Amount”, “Cap Date”, “Cap Payment”, “Sales Milestone Event”, “Sales
Milestone” and “Sales Milestone Payment”.



 


		(ii)	The following definitions in Section 1.01 of the Acquisition Agreement shall be amended and restated in their entirety as set
forth below:



 


“Amendment Payment” shall mean
$15,000,000.


 


“Applicable Percentage” shall mean
100%.


 


“Investment Amount” shall mean
the sum of the Approval Payment and the Amendment Payment paid by Buyer to Seller under this Agreement.


 


“Knowledge of the Seller” shall
mean the actual knowledge of Ron Cooper, Jan Mattsson, Simon Harford and Jason Duncan.


 






    


     


    

 


“Material Territory Patent Rights”
means any issued Territory Patent Right that claims the composition of matter of Elobixibat or a method using Elobixibat for an
indication (a) that is approved for marketing by a Regulatory Authority in Japan or (b) for which a marketing approval application
for Elobixibat has been filed by Licensee in Japan.


 


“Royalty Interest” shall mean an
undivided interest in respect of all present and future rights of Seller to receive the Applicable Percentage of the Included Product
Payments.


 


		(iii)	Section 2.01(c)(ii) of the Acquisition Agreement shall be deleted in it is entirety.



 


		(iv)	Section 2.02(d) of the Acquisition Agreement shall be amended and restated in its entirety as follows:



 


“(d) In the event Buyer receives any payment
pursuant to the License Agreement or this Agreement (directly, via sweep of funds from the Deposit Account or otherwise) that is
not part of the Royalty Interest (“Excess Payments”), Buyer shall remit to Seller each such Excess Payment within 10
Business Days after receipt thereof by wire transfer of immediately available funds as directed by Seller.”


 


		(v)	Section 2.02(e) of the Acquisition Agreement shall be amended and restated in its entirety as follows:



 


“(e) For clarity, any Withholding Tax (excluding
the excess of (a) any Subsequent Withholding Tax in respect of the applicable payments, subject to Section 5.13, over (b) the amount
of any tax benefit, offset or credit to Buyer as a result of such Subsequent Withholding Tax) deducted or withheld from any payment
due to Buyer pursuant to the License Agreement or this Agreement shall, for purposes of this Agreement, be considered a Royalty
Interest Payment received by Buyer. For clarity and with the intent of avoiding “double counting,” any payments made
by Seller or any of its Affiliates to Buyer in respect of any Indemnified Withholding Tax pursuant to Section 8.05(d) shall, for
purposes of this Agreement, not be considered “Royalty Interest Payments.” As an illustration of the foregoing, if
a Royalty Interest Payment equal to $100 is payable to Buyer and there is an Indemnified Withholding Tax in an amount equal to
$20, Buyer shall be deemed to have received a Royalty Interest Payment in an amount equal to $100, and the $20 payment by Seller
or any of its Affiliates to Buyer in respect of such Indemnified Withholding Tax shall not be deemed a Royalty Interest Payment.”


 


		(vi)	Section 2.04(a) of the Acquisition Agreement shall be amended by deleting “whether the Sales Milestone Event has occurred,”
as the beginning of such section.



 






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		(vii)	Section 2.04(b) of the Acquisition Agreement shall be amended by deleting “the Cap Amount,” at the beginning of
such section.



 


		(viii)	Section 2.05 of the Acquisition Agreement shall be deleted in its entirety.



 


		(ix)	Section 6.01(c) of the Acquisition Agreement shall be deleted in its entirety.



 


		(x)	Section 7.01(c) of the Acquisition Agreement shall be amended and restated in its entirety as follows:



 


“(c) This Agreement shall terminate on the earlier
to occur of (x) the date on which this Agreement is terminated by either Party pursuant to and in accordance with Sections 7.01(a)
and, in the case of termination by Buyer, Section 7.01(b) and (y) the License Expiration.”


 


		(b)	The following definition in the Protective Rights Agreement shall be amended and restated in its entirety as follows:



 


		(i)	“Collateral Patent Rights” means the following Japanese patents: No. 3665055, No. 4870552, No. 5421326,
No. 5889321, No. 6097695, No. 6456921 and No. 2017-519487.



 


		2.	Representations and Warranties.



 


		(a)	Each of Seller and Seller Parent represents and warrants to Buyer that:



 


		(i)	Each of Seller and Seller Parent has all necessary legal power and authority to enter into, execute and deliver this Amendment
and to perform all of the obligations to be performed by it hereunder and to consummate the transactions contemplated hereunder.
None of the execution and delivery by each of Seller and Seller Parent of this Amendment, the performance by each of Seller and
Seller Parent of any of the obligations to be performed by it hereunder, or the consummation by each of Seller and Seller Parent
of any of the transactions contemplated hereby, will require any notice to, action, approval or consent by, or in respect of, or
filing or registration with, any Governmental Authority or other Person.



 


		(ii)	Once signed by each of Seller and Seller Parent, this Amendment will have been duly authorized, executed and delivered by each
of Seller and Seller Parent and, assuming it is duly executed by Buyer, this Amendment will then constitute the valid and binding
obligation of Seller and Seller Parent, enforceable against Seller and Seller Parent in accordance with its terms, subject, as
to enforcement of remedies, to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights
generally or general equitable principles.



 






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		(iii)	As of the date of this Amenement, to the Knowledge of Seller, no event has occurred and is continuing which could reasonably
be expected to have a Material Adverse Effect on the Royalty Interest.



 


		(b)	Buyer represents and warrants to Seller and Seller Parent that



 


		(i)	Buyer has all necessary legal power and authority to enter into, execute and deliver this Amendment and to perform all of the
obligations to be performed by it hereunder and to consummate the transactions contemplated hereunder. None of the execution and
delivery by Buyer of this Amendment, the performance by Buyer of any of the obligations to be performed by it hereunder, or the
consummation by Buyer of any of the transactions contemplated hereby, will require any notice to, action, approval or consent by,
or in respect of, or filing or registration with, any Governmental Authority or other Person.



 


		(ii)	Once signed by Buyer, this Amendment will have been duly authorized, executed and delivered by Buyer and, assuming it is duly
executed by Seller and Seller Parent, this Amendment will then constitute the valid and binding obligation of Buyer, enforceable
against Buyer in accordance with its terms, subject, as to enforcement of remedies, to bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors’ rights generally or general equitable principles.



 


		3.	Additional Agreements and Investment.



 


		(a)	Additional Investment. Within 15 Business Days of the date of this Amendment, subject to satisfaction of the conditions
set forth in Section 3(b) of this Amendment, Buyer shall pay to Seller or its designee an amount equal to the Amendment Payment
less the amount of Buyer Amendment Expenses, by wire transfer of immediately available funds as directed by Seller (the “Additional
Investment”). The date of the closing of the Additional Investment (the “Additional Investment Closing”)
shall be referred to herein as the “Additional Investment Closing Date”.



 


For purposes hereof, the term “Buyer Amendment
Expenses” shall mean the amount of Buyer’s actual, documented, out-of-pocket fees and expenses incurred in connection
with Buyer’s confirmatory due diligence and legal documentation associated with the negotiation and execution of this Amendment,
provided that in no event shall Buyer Amendment Expenses exceed [***]. Buyer acknowledges that [***] of the Buyer Amendment
Expenses has been paid by Seller prior to the date hereof, which amount shall be credited toward the total amount of Buyer Amendment
Expenses to be deducted from the Amendment Payment pursuant to this Section 3(a).


 


		(b)	Additional Investment Conditions. The obligations of Buyer to effect the Additional Investment Closing and to make the
Amendment Payment in accordance with Section 3(a) of this Amendment shall be subject to the following conditions, as of the date
of the Additional Investment Closing, any of which may be waived by Buyer in its sole discretion:



 






    4


     


    

 


		(i)	Each of Seller and Seller Parent shall have performed and complied in all material respects with all covenants required by
the Transaction Documents to be performed or complied with by it on or prior to the Additional Investment Closing Date.



 


		(ii)	At the Additional Investment Closing, (A) the Subsequent Closing Representations (other than Section 3.08(b)) and the representations
and warranties of the Seller and Seller Parent in Section 2 of this Amendment shall be true, correct and complete in all respects
on and as of the Additional Investment Closing Date as though made on and as of the Additional Investment Closing Date, and (B)
the Subsequent Closing Representations in Section 3.08(b), shall be true, correct and complete on and as of the Additional Investment
Closing Date as though made on and as of the Additional Investment Closing Date except where the failure to be true, correct or
complete would not reasonably be expected to have a Material Adverse Effect; and



 


		(iii)	Seller shall have delivered to Buyer a certificate dated as of the date of the Additional Investment Closing executed by an
officer of Seller expressly confirming and certifying that the conditions set forth in Section 3(b)(i) and 3(b)(ii) of this Amendment
have been met.



 


		(c)	The Parties acknowledge that the provisions of this Section 3 of this Amendment shall be deemed to be incorporated into and
part of the terms of the Acquisition Agreement.



 


		(d)	Each of the Parties shall use their commercially reasonable efforts as promptly as practicable following the Additional Investment
Closing to seek an additional consent from Licensee that would, among other things, allow Buyer the right to directly enforce the
obligations of Licensee and the rights of Seller, in each case, with respect to the Royalty Interest and the Collateral Patent
Rights under the License Agreement and to assign such Seller rights to Buyer. In the event that such consent of the Licensee is
granted, Seller and Buyer shall use their commercially reasonable efforts to negotiate in good faith amendments to the Purchase
Agreement to reflect the assignment of such rights to Buyer and related changes, including to the covenants in Article V, to reflect
such assignment. Notwithstanding the foregoing, Seller shall not, in the exercise of commercially reasonable efforts, be required
to pay any amount to Licensee to obtain the consent or amendment referred to in this Section 3(d) unless Buyer agrees to reimburse
Seller for any such amounts.



 


		(e)	In furtherance of its obligations under Sections 6 and 8 of the Protective Rights Agreement, within thirty (30) days of the
Additional Investment Closing, Seller Parent shall execute and deliver to Buyer (i) one original of a Pledge Agreement and Power
of Attorney in the form of Exhibit A to the Protective Rights Agreement and (ii) one original of a Special Power of Attorney in
the form of Exhibit B to the Protective Rights Agreement, in each case, for execution of a collateral assignment of the Collateral
Patent Rights to Buyer, or the implementation of the sale or other disposition of the Collateral Patent Rights pursuant to Buyer’s
good faith exercise of the rights and remedies granted pursuant to the Protective Rights Agreement.



 






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		4.	No Other Changes. Except as expressly provided herein, the Acquisition Agreement is not amended, modified or otherwise
affected by this Amendment, and the Acquisition Agreement and the rights and obligations of the parties thereunder are hereby ratified
and confirmed in all respects. From and after the date hereof, all references to the Acquisition Agreement shall refer to the Acquisition
Agreement as amended by this Amendment (including for the avoidance of doubt, references to the Acquisition Agreement in that certain
Assignment Agreement, dated as of December 28, 2017 by and between Seller and Buyer).



 


		5.	Miscellaneous Provisions.



 


		(a)	Headings and Captions. The headings and captions in this Amendment are for convenience and reference purposes only and
shall not be considered a part of or affect the construction or interpretation of any provision of this Agreement.



 


		(b)	Counterparts; Effectiveness. This Amendment may be executed in two or more counterparts, each of which shall be an original,
but all of which together shall constitute one and the same instrument. This Amendment shall become effective when each Party shall
have received a counterpart hereof signed by the other Party. Any counterpart may be executed by facsimile or .pdf signature and
such facsimile or .pdf signature shall be deemed an original.



 


		(c)	Severability. If any provision of this Amendment is held to be invalid or unenforceable, the remaining provisions shall
nevertheless be given full force and effect. Any provision of this Amendment held invalid or unenforceable only in part or degree
by a court of competent jurisdiction shall remain in full force and effect to the extent not held invalid or unenforceable.



 


		(d)	Expenses. Except to the extent reflected in payments made pursuant to Section 3(a) of this Amendment, each of Buyer,
Seller and Seller Parent will pay its own fees and expenses in connection with entering into and consummating the transactions
contemplated by this Amendment.



 






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		(e)	Governing Law; Jurisdiction. This Amendment shall be governed by, and construed, interpreted and enforced in accordance
with, the laws of the State of New York without giving effect to the principles of conflicts of law thereof that would apply any
other law. Each Party unconditionally and irrevocably consents to the exclusive jurisdiction of the courts of the State of New
York located in New York City (Borough of Manhattan) and the federal district court for the Southern District of New York located
in New York City (Borough of Manhattan) with respect to any suit, action or proceeding arising out of or relating to this Amendment
or the transactions contemplated hereby. Each Party hereby further irrevocably waives any objection, including any objection to
the laying of venue or based on the grounds of forum non conveniens, which it may now or hereafter have to the bringing of any
action or proceeding in such jurisdiction in respect of any Transaction Document. Each Party hereby irrevocably consents to the
service of process out of any of the courts referred to in this Section (5(e) in any such suit, action or proceeding by the mailing
of copies thereof by registered or certified mail, postage prepaid, to it at its address set forth in the Acquisition Agreement.
Each Party hereby irrevocably waives any objection to such service of process and further irrevocably waives and agrees not to
plead or claim in any suit, action or proceeding commenced hereunder or under any other Transaction Document that service of process
was in any way invalid or ineffective. Nothing herein shall affect the right of a Party to serve process on the other Party in
any other manner permitted by law.



 


		(f)	Waiver of Jury Trial. EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY TRANSACTION DOCUMENT
OR THIS AMENDMENT OR THE TRANSACTIONS CONTEMPLATED UNDER ANY TRANSACTION DOCUMENT OR THIS AMENDMENT. THIS WAIVER SHALL APPLY TO
ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO ANY TRANSACTION DOCUMENT (WHETHER BASED ON CONTRACT, TORT
OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HERETO HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT THE OTHER PARTY HERETO WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER
AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTY HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5(F).



 


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Blank]


 




    7


     


    


 


IN WITNESS WHEREOF, this Amendment has been
duly executed and delivered by the undersigned as of the date first written above.


 


	SELLER:	ELOBIX AB
	 	 
	 	 
	 	By:	/s/
    Ronald Cooper
	 	Name:	Ronald Cooper
	 	Title:	Director
	 	 
	SELLER PARENT:	ALBIREO PHARMA, INC.
	 	 
	 	 
	 	By:	/s/ Ronald
    Cooper
	 	Name:	Ronald Cooper
	 	Title:	Chief Executive Officer
	 	 
	BUYER:	HealthCare Royalty Partners
    III, L.P.
	 	 
	 	By:HealthCare
    Royalty GP III, LLC, its general partner
	 	 
	 	 
	 	By:	/s/ Clarke
    B. Futch
	 	Name:	Clarke B. Futch
	 	Title:	Managing Partner




 


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