Document:

Exhibit

Exhibit 10.2

[Jazz Pharmaceuticals Letterhead]

 
 
March 24, 2018

Karen Smith
Jazz Pharmaceuticals, Inc.
3170 Porter Drive
Palo Alto, CA  94304

Re:    Transition and Separation Agreement

Dear Karen:
This letter sets forth the terms of the transition and separation agreement (the “Agreement”) between you and Jazz Pharmaceuticals, Inc. (the “Company”).
1.Separation Date; Transition Employment Period; Final Base Salary and Vacation Pay-Out.  If you sign, date, and return this Agreement to the Company by 5 pm on March 26, 2018, your employment with the Company will end effective as of May 31, 2018 (the “Separation Date”).  During your continued employment from the date that you are provided this Agreement through the Separation Date (the “Transition Employment Period”), you will continue to report to the President and Chief Operating Officer (“COO”), and you will engage in such work activities, and operate in such capacity, as the COO directs.  Effective as of April 2, 2018, your position title will change from EVP, R&D and CMO, to the title of EVP, Special Projects.  You will continue to receive your regular base salary payments and the benefits coverage in which you are currently enrolled, and your equity awards will continue to vest on their normal schedules.  You will be expected to work remotely on a regular basis, provided that, you will be available to come into the office if requested for in-person meetings or other in-person activities.  During the Transition Employment Period, you must continue to act professionally and to maintain positive internal and external communications about your employment and planned departure from the Company (including complying with Sections 8 and 9 of this Agreement), and you must materially comply with the terms of this Agreement and all applicable policies and procedures; in the event that you fail to meet all of these requirements, then the Company may accelerate the Separation Date to an earlier date and you shall not be entitled to receive the Severance Benefits set forth herein.  In addition, if you intend to commence employment with a new entity prior to June 1, 2018, you shall tender your resignation to the Company (providing at least ten (10) business days’ advance notice) and the Separation Date will be accelerated to the effective date of your resignation; if that occurs, you will remain eligible for the Severance Benefits, provided that the Severance Conditions (defined below) are fully satisfied.  On the Separation Date, the Company will pay your final base salary through the Separation Date and any accrued and unused vacation as of the Separation Date, subject to standard payroll deductions and withholdings. 

March 24, 2018
Karen Smith

2.Severance Benefits.  Although the Company is not otherwise required to provide severance benefits, if you fully satisfy the Severance Conditions, then you will receive the severance benefits discussed below (the “Severance Benefits”).  The “Severance Conditions” are as follows: (i) you must timely enter into this Agreement (as discussed in Section 1); (ii) on the Separation Date or within twenty-one (21) days thereafter, you must sign, date and return the Release Agreement attached as Exhibit A, and you must not subsequently revoke the Release Agreement; (iii) you must materially comply with all of your obligations under this Agreement; and (iv) you must materially comply with all of your obligations under your Confidentiality Agreement (as defined below).
(a)Severance Payment.  The Company will pay you a lump sum severance payment in the amount of $315,000.00, which is equivalent to seven (7) months of your base salary, subject to required payroll deductions and withholdings (the “Severance Payment”).  The Severance Payment will be paid to you within ten (10) business days from the later of the following:  (i) the Separation Date, and (ii) the Effective Date of the Release Agreement (as defined therein). 
(b)Health Insurance.  Under the terms of the Company’s group health insurance plan, your group health insurance coverage will terminate at the end of the calendar month in which your employment ends (which is anticipated to be the month of May).  To the extent provided by the federal COBRA law or, if applicable, state insurance laws (collectively, “COBRA”), and by the Company’s current group health insurance policies, you will be eligible to continue your group health insurance benefits thereafter by timely electing COBRA continuation coverage.  You will receive a notice of your COBRA rights and obligations, including instructions for electing COBRA coverage, within the timing required by law.  If you timely elect COBRA coverage and continue to be eligible for such coverage, the Company will pay your COBRA premiums for the time period from the Separation Date through December 31, 2018 (the “COBRA Payment Period”), including the premium for your covered dependents.  Notwithstanding the foregoing, the Company’s obligation to pay your COBRA premiums will end earlier if you fail to satisfy any of the Severance Conditions or you obtain new employment through which you are eligible for group health insurance benefits during the COBRA Payment Period.  You must promptly inform the Company’s Human Resources department in writing if you obtain new employment through which you are eligible for group health insurance benefits prior to December 31, 2018.  After the COBRA Payment Period, you are solely responsible for payment of your COBRA premiums if you wish to continue your COBRA coverage
3.Equity Awards.  On the Separation Date, vesting of any outstanding stock options that you have to purchase ordinary shares of Jazz Pharmaceuticals plc and of any outstanding Jazz Pharmaceuticals plc restricted stock unit awards that have been issued to you will cease, and any unvested portion of such options or unvested restricted stock unit awards will terminate.  You will be able to exercise any vested portion of such options under the terms of your stock option agreement(s) with Jazz Pharmaceuticals plc and the applicable Equity Incentive Plan(s).

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Karen Smith

4.Confidential Information and Inventions Agreement.  You acknowledge and reaffirm your continuing obligations under your previously signed Employee Confidential Information and Inventions Agreement (the “Confidentiality Agreement”), a copy of which is attached as Exhibit B.      
5.Other Compensation or Benefits.  You acknowledge that, except as expressly provided in this Agreement, you have not earned and will not receive any additional compensation, severance or benefits prior to, on or after the Separation Date, including but not limited to any bonus payment or incentive compensation, with the exception of any vested benefits you may have under the express terms of a written ERISA-qualified benefit plan (e.g., 401(k) account).    
6.Expense Reimbursements.  During the Transition Employment Period, you will remain eligible for reimbursement of properly documented business expenses as provided under the Global Travel & Expense Policy (“T&E Policy”).  You agree that, prior to the Separation Date, you will submit your final documented expense reimbursements via Concur consisting of any and all outstanding business expenses, including your reconciliation of any outstanding charges on your Company credit card (whether such charges are personal or business in nature).  The Company agrees that it will promptly reimburse you for any outstanding documented business expenses under the terms of the T&E Policy, and, to the extent applicable, you agree to reimburse the Company for any outstanding personal charges on your corporate credit card.   Moreover, consistent with its obligations under California law, the Company will indemnify you for any out-of-pocket costs or damages or liabilities you may incur with respect to any dispute it may have with any other entity that arose from events during the term of your employment with the Company, including reimbursing you for reasonable out-of-pocket expenses you may incur in connection with any such dispute (excluding forgone wages, salary, or other compensation).
7.Return of Company Property.  By the close of business on the Separation Date (or earlier, if requested by the Company), you agree to return to the Company all Company documents (and all copies thereof, except as provided below) and other Company property that you have in your possession or control, including, but not limited to, Company files, notes, drawings, records, business plans and forecasts, financial information, specifications, computer-recorded information including contact information stored in your Company Outlook account, tangible property (including, but not limited to, computers), credit cards, entry cards, identification badges and keys; and, any materials of any kind that contain or embody any proprietary or confidential information of the Company (and all reproductions thereof).  You agree that you will make a diligent search to locate any such documents, property and information.  Prior to your return of the Company’s electronic devices (including laptop, mobile phone and iPad), you must delete from these devices any information of other entities contained on such devices which are not related to the Company or its business (for example, any information of entities for which you hold external roles or positions); additionally, you may retain copies of your personal information including personal emails and personal contact information.  In addition, if you have used any personally owned computer, server, e-mail system, mobile phone, portable electronic device (e.g., smartphone, iPad or the like) 

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(collectively, “Personal Systems”) to receive, store, prepare or transmit any Company confidential or proprietary data, materials or information, then no later than the Separation Date, you will permanently delete and expunge all such Company confidential or proprietary information from such Personal Systems without retaining any copy or reproduction in any form. 
8.Confidentiality.  The provisions of this Agreement, and the discussions between you and the Company concerning this Agreement, will be held in strictest confidence by you and you will not publicize or disclose them in any manner whatsoever; provided, however, that:  (a) you may disclose this Agreement in confidence to your immediate family; (b) you may disclose this Agreement in confidence to your attorneys, accountants, auditors, tax preparers, and financial advisors; (c) you may disclose this Agreement insofar as such disclosure may be necessary to enforce its terms; (d) you may disclose this Agreement, and any other documents or information (without notice to the Company), when communicating with the Equal Employment Opportunity Commission, the Department of Labor, the National Labor Relations Board, the Occupational Safety and Health Administration, the Securities and Exchange Commission or any other federal, state or local governmental agency or commission (“Governmental Agencies”), or in the course of an investigation or proceeding that may be conducted by any Government Agency; and (e) you may disclose this Agreement to the extent required by the legal process (including in response to a subpoena).  Due to your status as a Named Executive Officer, the Company will (a) pursuant to a Form 8-K filing and certain other filings with the Securities and Exchange Commission, each within the timing required by law, disclose a brief description of the cessation of your employment and the terms of this Agreement, and the amounts payable to you hereunder; and (b) pursuant to a Company periodic report filing with the Securities and Exchange Commission within the timing required by law, file a copy of this Agreement.  Once the Agreement becomes publicly available, you may disclose its terms.  Nothing in this provision or this Agreement is intended to prohibit or restrain you in any manner from making disclosures that are protected under the whistleblower provisions of federal or state law or regulation.
9.Nondisparagement; Communications Regarding Departure; Responses to Job Reference Inquiries.  You represent that you have not previously, and you agree that you will not at any time, disparage the Company, Jazz Pharmaceuticals plc, or any of each of their respective officers, directors, employees, shareholders, subsidiaries, affiliates, or agents, in any manner likely to be harmful to any of them or their business, business reputation or personal reputation.  In addition, the Company agrees to instruct the members of the Executive Committee and Board of Directors of Jazz Pharmaceuticals plc not to disparage you in any manner likely to be harmful to you or your business reputation or personal reputation.  Both you and the Company agree that our communications discussing reasons for your departure will be consistent with the departure messaging as discussed with you, and you will be given the opportunity to review and provide input concerning the draft external and internal (Company-wide) announcements concerning your departure, prior to their finalization by the Company.  With respect to employment verification or employment reference inquiries, the Company will follow its policies contained in the U.S. Employee Handbook by providing an official confirmation or verification from the Human Resources department confirming your dates of employment and 

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job title.  Notwithstanding the foregoing, all parties may respond accurately and fully to any question, inquiry or request for information in the course of a government investigation or when required by legal process (including in response to a subpoena).  In addition, nothing in this provision or this Agreement is intended to prohibit or restrain you in any manner from making disclosures that are protected under the whistleblower provisions of federal or state law or regulation.
10.No Voluntary Adverse Action; Cooperation.  You agree that you will not voluntarily assist any other person in bringing or pursuing any claim or action of any kind against the Company, Jazz Pharmaceuticals plc, or any subsidiaries of either entity, or any of either of their officers, directors, employees or agents.  Notwithstanding the foregoing, you may cooperate with, or participate in any proceeding before, any Governmental Agency or as required by compulsion of law.  In addition, you agree to cooperate fully with the Company, Jazz Pharmaceuticals plc, and affiliated entities, in connection with the actual or contemplated defense, prosecution, or investigation of any claims or demands by or against third parties (e.g., demands to produce documents or testimony pursuant to subpoena), or other matters arising from events, acts, or failures to act that occurred during the period of your employment by the Company.  Such cooperation includes, without limitation, making yourself available to the Company upon reasonable notice, without subpoena, to provide truthful and accurate information in witness interviews with the Company or its counsel, and in deposition and trial testimony.  The Company will reimburse you for reasonable out-of-pocket expenses you may incur in connection with any such cooperation (excluding forgone wages, salary, or other compensation) and will make reasonable efforts to accommodate your scheduling needs.
11.Release of Claims.  
(a)General Release.  Except as otherwise set forth in this Agreement, you hereby generally and completely release the Company, Jazz Pharmaceuticals plc, and their respective current and former directors, officers, employees, shareholders, partners, agents, attorneys, predecessors, successors, parent and subsidiary entities, insurers, affiliates, and assigns (collectively, the “Released Parties”) of and from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring prior to your signing of this Agreement (collectively, the “Released Claims”).  
(b)Scope of Released Claims.  The Released Claims include, but are not limited to:  (i) all claims arising out of or in any way related to your employment with the Company, or the termination of that employment; (ii) all claims related to your compensation or benefits from the Company or any of the Company’s parent or subsidiary entities or affiliates, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in the Company or any of the Company’s parent or subsidiary entities or affiliates; (iii) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (iv) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation 

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Karen Smith

of public policy; and (v) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Family and Medical Leave Act (as amended), the California Family Rights Act (as amended), the California Fair Employment and Housing Act (as amended), the Pennsylvania Equal Pay Law, the Pennsylvania Wage Payment and Collection Law, the City of Philadelphia Fair Practices Code, and the Pennsylvania Human Relations Act.
(c)Excluded Claims.  Notwithstanding the foregoing, the following are not included in the Released Claims (the “Excluded Claims”): (i) any rights or claims for indemnification you may have pursuant to any written indemnification agreement with the Company to which you are a party, the charter, bylaws, or operating agreements of the Company, or under applicable law; or (ii) any rights which are not waivable as a matter of law.  You understand that nothing in this Agreement limits your ability to file a charge or complaint with any Governmental Agency.  While this Agreement does not limit your right to receive an award for information provided to the Securities and Exchange Commission, you understand and agree that, to the maximum extent permitted by law, you are otherwise waiving any and all rights you may have to individual relief (including any monetary awards) based on any claims that you have released and any rights you have waived by signing this Agreement.  You hereby represent and warrant that, other than the Excluded Claims, you are not aware of any claims you have or might have against any of the Released Parties that are not included in the Released Claims.    
(d)Section 1542 Waiver.  You acknowledge that you have read and understand Section 1542 of the California Civil Code which reads as follows: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”  You hereby expressly waive and relinquish all rights and benefits under that section and any law of any jurisdiction of similar effect with respect to your release of any claims hereunder, including but not limited to any unknown or unsuspected claims.
12.General.  This Agreement, including its Exhibits, constitutes the complete, final and exclusive embodiment of the entire agreement between you and the Company with regard to this subject matter.  It is entered into without reliance on any promise or representation, written or oral, other than those expressly contained herein, and it supersedes any other such promises, warranties or representations.  This Agreement may not be modified or amended except in a writing signed by both you and a duly authorized officer of the Company.  This Agreement will bind the heirs, personal representatives, successors and assigns of both you and the Company, and inure to the benefit of both you and the Company, their heirs, successors and assigns.  If any provision of this Agreement is determined to be invalid or unenforceable, in whole or in part, this determination will not affect any other provision of this Agreement and the provision in question will be modified by the court so as to be rendered enforceable to the fullest extent permitted by law, consistent with the intent of the parties.  Electronic signatures, including signatures on PDF transmitted electronically, will qualify as original signatures.  This Agreement will be deemed to 

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have been entered into and will be construed and enforced in accordance with the laws of the State of California without regard to conflicts of law principles.
[Rest of page intentionally blank.]

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Karen Smith

If this Agreement is acceptable to you, please sign and date it below, and return the fully signed Agreement by no later than 5 pm PDT on Monday, March 26, 2018.  The fully signed Agreement may be returned in person or by email (via signed PDF) sent to me, Matt Ford, or Dan Swisher.  
In addition, as discussed herein, as a condition of your eligibility for the Severance Benefits, on the Separation Date or within twenty-one (21) days thereafter, you must sign, date and return the Release Agreement attached as Exhibit A, and you must not revoke it.
We look forward to continuing to work with you during the Transition Employment Period, and I wish you the best in your future endeavors.
Sincerely,
	
			
	 	Jazz Pharmaceuticals, Inc.

	 
	 	By:
	/s/ Heather P. McGaughey

	 	 
	Heather McGaughey

	 	 
	SVP, Human Resources

Exhibit A - Release Agreement
Exhibit B - Employee Confidential Information and Inventions Agreement

	
		
	 	Reviewed, Understood, and Agreed:

	 
	 	/s/ Karen Smith

	 	Karen Smith

	 	 

	 	March 26, 2018

	 	Date

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Karen Smith

Exhibit A
Release Agreement
(To be signed and returned on the Separation Date or within 21 days after)

 I am entering into this Release Agreement (“Release”) pursuant to the terms of the Transition and Separation Agreement between me and Jazz Pharmaceuticals, Inc. (the “Company”).  In exchange for the Severance Benefits, and except as otherwise set forth in this Release, I hereby generally and completely release the Company, Jazz Pharmaceuticals plc, and their respective current and former directors, officers, employees, shareholders, partners, agents, attorneys, predecessors, successors, parent and subsidiary entities, insurers, affiliates, and assigns (collectively, the “Released Parties”) of and from any and all claims, liabilities and obligations, both known and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring prior to my signing this Release (collectively, the “Released Claims”).  
The Released Claims include, but are not limited to:  (1) all claims arising out of or in any way related to my hiring by the Company, my employment with the Company, or the termination of that employment; (2) all claims related to my compensation or benefits from the Company or any of the Company’s parent or subsidiary entities or affiliates, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other ownership interests in the Company or any of the Company’s parent or subsidiary entities or affiliates; (3) all claims for breach of contract, wrongful termination, and breach of the implied covenant of good faith and fair dealing; (4) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and (5) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys’ fees, or other claims arising under the federal Civil Rights Act of 1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Age Discrimination in Employment Act of 1967 (as amended) (“ADEA”), the federal Family and Medical Leave Act (as amended) (“FMLA”), the California Labor Code (as amended), the California Fair Employment and Housing Act (as amended), the California Family Rights Act, the Pennsylvania Equal Pay Law, the Pennsylvania Wage Payment and Collection Law, the City of Philadelphia Fair Practices Code, and the Pennsylvania Human Relations Act.  
Notwithstanding the foregoing, the following are not included in the Released Claims (the “Excluded Claims”): (1) any rights or claims for indemnification I may have pursuant to any written indemnification agreement with the Company to which I am a party, the charter, bylaws, or operating agreements of the Company, or under applicable law; or (2) any rights which are not waivable as a matter of law.  In addition, nothing in this Release prevents me from filing, cooperating with, or participating in any proceeding before the Equal Employment Opportunity Commission, the Department of Labor, or any other government agency.  I understand that while this Release does not limit my right to receive an award for information provided by the Securities and Exchange Commission, I am otherwise waiving my right to any monetary benefits in connection with any such claim, charge or proceeding.  I hereby represent and warrant that, other than the Excluded Claims, I am not aware of any claims I have or might have against any of the Released Parties that are not included in the Released Claims.  
I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have under the ADEA.  I also acknowledge that the consideration given for the Released Claims is in addition to anything of value to which I was already entitled.  I further acknowledge that I have been advised by this writing, as required by the ADEA, that: (1) the Released Claims do not apply to any rights or claims that arise after the date I sign this Release; (2) I should consult with an attorney prior to signing this Release (although I may choose voluntarily not to do so); (3) I have up to twenty-one (21) days from the Separation 

March 24, 2018
Karen Smith

Date to consider this Release; (4) I have seven (7) days following the date I sign this Release to revoke it by providing written notice to the Company’s Legal & Compliance Department in Palo Alto, California to the attention of Ann Polus, Senior Corporate Counsel, Global Human Resources; and (5) the Release will not be effective until the date upon which the revocation period has expired unexercised, which will be the eighth day after I sign this Release Agreement (“Effective Date”).  
I acknowledge that I have read and understand Section 1542 of the California Civil Code which reads as follows: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.”  I hereby expressly waive and relinquish all rights and benefits under that section and any law of any jurisdiction of similar effect with respect to my release of any claims hereunder, including but not limited to any unknown or unsuspected claims.

	
		
	 

	Karen Smith

	 
	 

	Date:
	 

March 24, 2018
Karen Smith

Exhibit B
Employee Confidential Information and Inventions Agreement

Jazz Pharmaceuticals, Inc.
EMPLOYEE CONFIDENTIAL INFORMATION AND
INVENTIONS AGREEMENT
In partial consideration and as a condition of my employment or continued employment with Jazz Pharmaceuticals, Inc., a Delaware corporation (which together with any parent, subsidiary, affiliate, or successor is hereinafter referred to as the “Company”), and effective as of the date that my employment with the Company first commenced (or, if earlier, the date on which I began my discussions with the Company concerning my employment by the Company), the Company and I hereby agree as follows:  
1.Noncompetition; At-Will Employment.  During my employment with the Company, I will perform for the Company such duties as it may designate from time to time and will devote my best efforts to the business of the Company and will not, without the prior written approval of an officer of the Company if I am not an executive officer of the Company or the Board of Directors of the Company if I am an executive officer of the Company, directly or indirectly participate in or assist any business which is a current or potential supplier, customer, or competitor of the Company or otherwise engage in activities which would conflict with my employment by the Company.  I agree that unless specifically provided in another writing signed by me and an officer of the Company and duly authorized by the Board of Directors, my employment by the Company is not for a definite period of time.  Rather, my employment relationship with the Company is one of employment at will.  This means that either the Company or I may terminate the employment relationship at any time for any reason or no reason, with or without cause or prior notice.   Nothing in this Agreement is intended to create any employment relationship or arrangement other than “at will” employment,  Nor is anything in this Agreement ,intended to give me any right to continued employment by the Company or to limit my right or the Company’s right to terminate my employment at any time.   If I leave the employ of the Company, I consent to the Company notifying my new employer (or any third party with whom I maintain a consulting relationship) of my rights and obligations under this Agreement.
2.Nonsolicitation.  During the term of my employment by the Company, and for twelve months thereafter, I shall not directly or indirectly, without the prior written consent of the Company, solicit, recruit, encourage or induce any employees, directors, consultants, contractors or subcontractors of the Company to terminate their relationship with the Company, either on my own behalf or on behalf of any other person or entity.
3.Confidentiality Obligation.  I will hold all Confidential Information in confidence and will not disclose, use, copy, publish, summarize, or remove from the 

Revised January 2015

premises of the Company any Confidential Information, except (a) as necessary to carry out my assigned responsibilities as a Company employee, and (b) upon and after termination of my employment, only as specifically authorized in writing by an officer of the Company.  “Confidential Information” is all information related to any aspect of the business of the Company which is either information not known by actual or potential competitors of the Company or is proprietary information of the Company, whether of a technical nature or otherwise.  Confidential Information includes, without limitation,  inventions, disclosures, processes, compounds, biological materials, gene sequences, systems, methods, formulae, devices, patents, patent applications, trademarks, intellectual properties, instruments, materials, products, patterns, compilations, programs, techniques, sequences, designs, research or development activities and plans, specifications, computer programs, source and object codes, costs of production, prices and other financial data, sales-related data and information, promotional methods, marketing plans, lists of names or classes of customers, or personnel, lists of suppliers, business plans, business opportunities, financial statements, financial models, or financial projections, information regarding the compensation of the Company’s employees and other service providers and the existence and content of any business discussions, negotiations or agreements between the Company and any third party.
4.Information of Others.  I will safeguard and keep confidential the proprietary information of customers, vendors, consultants, and other parties with which the Company does business to the same extent as if it were Company Confidential Information.  I will not, during my employment with the Company or otherwise, use or disclose to the Company any confidential, trade secret, or other proprietary information or material of any previous employer or other person, and I will not bring onto the Company’s premises any unpublished document or any other property belonging to any former employer or third party in violation of any lawful agreement with that former employer or third party.  
5.Company Property.  I acknowledge and agree that I have no expectation of privacy with respect to the Company’s electronic information systems and related devices (including, without limitation, telecommunications systems, networking or information processing systems, software, computer systems, voice mail, cell phones, PDAs, security systems and facsimile, copy and scanning systems).  I understand that all information composed, sent or received on these systems is and remains the property of the Company.  The Company has the right to review, audit, intercept, monitor, access and disclose all information created, received or sent over its electronic information systems for any purpose.  I further agree that any property situated on the Company’s premises and owned by the Company is subject to inspection by Company personnel at any time with or without notice.  All papers, records, data, notes, drawings, files, documents, samples, devices, products, equipment, computer files, databases and other materials, including 

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copies and in whatever form, relating to the business of the Company that I possess or create as a result of my Company employment, whether or not confidential, are the sole and exclusive property of the Company.  In the event of the termination of my employment, or at the Company’s request at any other time, I will promptly deliver all such materials to the Company and will sign and deliver to the Company the “Termination Certificate” attached hereto as Exhibit A.  I agree that I will not copy, delete or alter any information contained in my Company computer before I return it to the Company.  In addition, if I have used any personal computer, server or e-mail system to receive, store, review, prepare or transmit any Confidential Information I agree to provide the Company with a computer-useable copy of all such Confidential Information and then permanently delete and expunge such Confidential Information from those systems; and I agree to provide the Company access to my system as reasonably requested to verify that the necessary copying and/or deletion is completed.  
6.Ownership of Inventions.  All inventions, ideas, concepts, designs, developments, techniques, processes, improvements, schematics, formulas, compounds, compilations, methods, sequences, algorithms, trade secrets, software programs, software and systems documentation, works of authorship and other copyrightable works, and related know-how which result from work performed by me, alone or with others, during any period that I am employed by the Company, whether or not during normal working hours or on the premises of the Company, which relate, directly or indirectly, to the business of the Company or which arise out of my employment or from access to  Company Confidential Information, whether or not patentable, copyrightable, or qualified for other protection as proprietary information or works (collectively “Inventions”) shall be the property of the Company, and, to the extent permitted by law, shall be “works made for hire.”  I hereby assign and agree to assign to the Company or its designee, without further consideration, my entire right, title, and interest in and to all Inventions, other than Excluded Inventions (defined in Paragraph 7 of this Agreement), including all rights to obtain, register, perfect, and enforce patents, copyrights, trademark rights and other intellectual property protection for Inventions.  I will disclose promptly and in writing to the individual designated by the Company or to my immediate supervisor all Inventions which I have made or reduced to practice during my employment and for one year after my employment.  During and after my employment,  I will assist the Company (at its expense) in every proper way to obtain and enforce patents, copyrights, trademarks and other forms of intellectual property protection on Inventions in any and all countries, including the disclosure to the Company of all pertinent information and data with respect thereto, the execution of applications, specifications, assignments, recordations and all other instruments which the Company shall deem necessary in order to apply for, claim, obtain, maintain and transfer such rights and in order to assign and convey to the Company, its successors, assigns and nominees, the sole and exclusive rights, title and 

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interest in and to such Inventions, and any patents, copyrights, trademarks or other intellectual property rights relating thereto.
7.Excluded Inventions.  Attached hereto as Exhibit B is a list of all inventions, improvements, and original works of authorship which I desire to exclude from this Agreement, each of which has been made or reduced to practice by me prior to the commencement of my employment by the Company (an “Excluded Invention”) or, if no inventions are listed in Exhibit B, I represent there are no inventions owned by me or in which I have an interest.  I understand that this Agreement requires disclosure, but not assignment, of any invention that qualifies under Section 2870 of the California Labor Code, a copy of which is attached hereto as Exhibit C.  I agree that I will not incorporate, or permit to be incorporated, any Excluded Invention in any Invention without the Company’s prior written consent.  If in the course of my employment I incorporate any Excluded Invention into a Company process, machine or other work, I hereby grant to the Company a non-exclusive, perpetual, fully-paid and royalty-free, irrevocable and worldwide license, with rights to sublicense, to reproduce, make derivative works of, distribute, publicly perform, and publicly display in any form or medium, whether now known or later developed, make, have made, use, sell, import, offer for sale and exercise any and all present or future rights in such Excluded Invention.
8.Invention Records; Patent Applications.  I agree to create and maintain, and to make available to the Company’s legal counsel, adequate and current written records of all Inventions made by me (alone or with others) during the term of my employment with the Company.  Such records will be kept in the form of notes, sketches, drawings or other appropriate format.  All such records will be available to the Company at all times, and will be the sole property of the Company.  If the Company is unable, because of my mental or physical incapacity or for any other reason to secure my signature to apply for or to pursue any patent applications or copyright or trademark registrations covering any inventions or original works of authorship assigned to the company hereunder, I hereby irrevocably appoint the Company and its authorized officers and agents as my agent and attorney-in-fact  (which appointment is coupled with an interest) to act for me and on my behalf to execute and further the prosecution and issuance of letters patent and copyright and trademark registrations thereon and to do all other lawfully permitted acts to further such purposes, with the same legal effect as if I had executed them.
9.Prior Contracts.  I represent that there are no other contracts to assign inventions that are now in existence between any other person or entity and me.  I further represent that I have no other employments, consultancies, or undertakings which would restrict and impair my performance of this Agreement.

4

10.Agreements with the United States Government and Other Third Parties.  I acknowledge that the Company from time to time may have agreements with other persons or with the United States Government or agencies thereof which impose obligations or restrictions on the Company regarding Inventions made during the course of work under such agreements or regarding the confidential nature of such work.  I agree to be bound by all such obligations or restrictions and to take all action necessary to discharge the obligations of the Company under any such agreements.
11.Prior to the termination of my employment, I will cooperate with the Company in attending an exit interview and certify in writing that I have complied with the requirements of this Agreement.
12.Miscellaneous.
(a)Governing Law.  This Agreement and any related action shall be governed by, and construed in accordance with, the laws of the State of California excluding those laws that direct the application of the laws of another jurisdiction.  I expressly consent to personal jurisdiction and venue in the state and federal courts for the county in which Company’s principal place of business is located for any lawsuit filed there against me by Company arising from or related to this Agreement.
(b)Enforcement.  If any provision of this Agreement shall be determined to be invalid or unenforceable for any reason, it shall be adjusted rather than voided, if possible, in order to achieve the intent of the parties to the extent possible.  In any event, all other provisions of this Agreement, shall be deemed valid, and enforceable to the full extent possible.
(c)Injunctive Relief; Consent to Jurisdiction.  I acknowledge and agree that damages will not be an adequate remedy in the event of a breach of any of my obligations under this Agreement.  I therefore agree that the Company shall be entitled (without limitation of any other rights or remedies otherwise available to the Company and without the necessity of posting a bond) to obtain an injunction from any court of competent jurisdiction prohibiting the continuance or recurrence of any breach of this Agreement.  I hereby submit myself to the jurisdiction and venue of the courts of the State of California for purposes of any such action.  I further agree that service upon me in any such action or proceeding may be made by first class mail, certified or registered, to my address as last appearing on the records of the Company.
(d)Attorneys’ Fees.  If any party seeks to enforce its rights under this Agreement by legal proceedings or otherwise, the non-prevailing party shall pay all costs and expenses of the prevailing party.

5

(e)Waiver.  The waiver by the Company of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any subsequent breach of the same or any other provision hereof.
(f)Binding Effect.  This Agreement shall be binding upon and shall inure to the benefit of the successors, executors, administrators, heirs, representatives, and assigns of the parties.
(g)Survival.  The provisions of this Agreement shall survive the termination of my employment and the assignment of this Agreement by the Company to any successor in interest or other assignee.
(h)Headings.  The Section headings herein are intended for reference and shall not by themselves determine the construction or interpretation of this Agreement.
(i)Severability.  In case any provision of this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
(j)Entire Agreement; Modifications.  This Employee Confidential Information and Inventions Agreement contains the entire agreement between the Company and the undersigned employee concerning the subject matter hereof and supersedes any and all prior and contemporaneous negotiations, correspondence, understandings, and agreements, whether oral or written, respecting that subject matter.  All modifications to this Agreement must be in writing and signed by the party against whom enforcement of such modification is sought.

[Signature Page Follows]

6

IN WITNESS WHEREOF, I have executed this Employee Confidential Information and Inventions Agreement as of the 9 day of April, 2015.

	
			
	/s/ Karen Smith

	Employee Signature

	 
	 
	 

	Karen Smith

	Type/Print Employee's Name

	 
	 
	 

	Address:
	 
	 

	 
	 
	 

	 
	 
	 

	 
	 
	 

	Email:
	 
	 

    

                    

RECEIPT ACKNOWLEDGED:

Jazz Pharmaceuticals, Inc.

	
		
	By:
	Heather P. McGaughey

	 
	 

	Title:
	SVP, HR

7

EXHIBIT A

TERMINATION CERTIFICATION
I certify that I do not have in my possession, nor have I failed to return to Jazz Pharmaceuticals, Inc. (“the Company”), any papers, records, data, notes, drawings, invention records, laboratory notebooks, files, documents, computer files, databases, samples, devices, products, equipment, designs, computer programs, and other materials, including reproductions of any of the above items, belonging to the Company and its subsidiaries, affiliates, successors, customers or collaborative partners.
I certify that I have complied with all the terms of the Company’s Employee Confidential Information and Inventions Agreement signed by me, including the reporting of any Inventions (as defined therein) conceived or made by me (solely or jointly with others) covered by that agreement.
I agree that, in compliance with the Employee Confidential Information and Inventions Agreement, I will hold in confidence and will not disclose, use, copy, publish or summarize any Confidential Information (as defined in the Employee Confidential Information and Inventions Agreement) of the Company or of any of its customers, vendors, consultants or other parties with which it does business.
I certify that, to the extent I am aware of any suspected violations of law or Company policy related to financial reporting, healthcare compliance or employment issues, I have reported the suspected violations to the Company’s hotline or the Compliance or Legal departments or have provided the information to Human Resources in the course of my exit interview.
 I agree that for twelve months from the date of this Certificate, I will not either directly or indirectly solicit, induce, recruit or encourage any of the Company’s employees, directors, consultants, contractors or subcontractors to terminate their relationship with the Company, either on my own behalf or on behalf of any other person or entity.
	
				
	Date:
	 
	 
	 

	 
	 
	 
	 

	 
	 
	 
	Employee's Signature

	 
	 
	 
	 

	 
	 
	 
	 

	 
	 
	 
	Print Employee's Name

	 
	 
	 
	 

	 
	(Initial here)  I am not aware of any compliance issues that have not been reported

	 
	 
	 
	 

	to management of the compliance department.

Revised January 2015

EXHIBIT B

EXCLUDED INVENTIONS, IMPROVEMENTS, AND ORIGINAL WORKS OF AUTHORSHIP

(please mark N/A and initial if not applicable)

	
			
	Title
	Date
	Identifying Number
Or Brief Description

EXHIBIT C

California Labor Code
§ 2870.  Application of provision providing that employee shall assign or offer to assign rights in invention to employer.

		
	(a)
	Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information except for those inventions that either:

(1)    Relate at the time of conception or reduction to practice of the invention to     the employer’s business, or actual or demonstrably anticipated research or development of the employer; or

(2)    Result from any work performed by the employee for the employer.

		
	(b)
	To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable.

Added Stats 1979 ch 1001 § 1; Amended Stats 1986 ch 346 § 1.Exhibit

[*] = 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.
Exhibit 10.3

AMENDMENT NO. 1 CLINICAL AND COMMERCIAL MANUFACTURING AND SUPPLY AGREEMENT

This Amendment No. 1 (“Amendment No. 1”) is entered into by JAZZ PHARMACEUTICALS IRELAND LIMITED (“JAZZ”) and BAXTER ONCOLOGY GmbH (“Baxter”) as of January 18, 2018 (“Amend No. 1 Effective Date”).  
WHEREAS, Celator Pharmaceuticals, Inc. (“Celator”) and Baxter entered into that certain Clinical and Commercial Manufacturing and Supply Agreement dated as of December 22, 2010 (the “Agreement”);  
AND WHEREAS, JAZZ acquired Celator effective July 12, 2016 and the Agreement was assigned to JAZZ effective July 13, 2016;

AND WHEREAS, JAZZ and Baxter wish to amend certain provision(s) of the Agreement to change (i) the purchasing of certain JAZZ-supplied Components, (ii) the forecasting and (iii) the obligations to purchase/supply Product, among other things;

NOW, THEREFORE, in consideration of the foregoing recitals and the mutual promises hereinafter set forth JAZZ and Baxter agree that the following amendments shall be made to the Agreement as of the Amend No. 1 Effective Date:
1.All references to “Celator” under the Agreement are hereby amended to read “JAZZ”.
2.Article 1 “DEFINITIONS”, the definitions for “Baxter-supplied Components”, “Contract Year”, “JAZZ-supplied Components” and “Reservation Fees” are hereby deleted and replaced with the following definitions:
“Baxter-supplied Components” shall mean those Components to be supplied by Baxter as specified in the Product Master Plan.”
“Contract Year” shall mean the twelve (12) month period commencing on 3 August 2017 and each subsequent twelve (12) month period during the Commercial Term.”
“JAZZ-supplied Components” shall mean those Components to be supplied by JAZZ as specified in the Product Master Plan.”
“Reservation Fees” shall be the fees payable by JAZZ for modification or cancellation of a Firm Purchase Order as set forth in Section 4.4

3.Article 1 “DEFINITIONS”, the definitions for “DSPC”, “DSPG” and “Production Price” are hereby deleted in their entirety.
4.Article 1 “DEFINTIONS”, the following will be added as a new definition “Campaign”:
“Campaign” shall mean the running of at least [*] of Commercial Product in sequence without interruption by a different product manufactured in the same room which Campaign must result in at least the reduction of [*] of set up, [*] of functional testing and [*] of cleaning post functional testing as compared to the Production of a single Batch of Commercial Product.
5.Section 3.3 including subsection 3.3.1 “Components” are hereby deleted and replaced with the following:
“3.3    Components. As set forth in the Product Master Plan, Jazz shall purchase and supply Jazz-supplied Components which Jazz, at its sole cost and expense (including, without limitation, shipping costs), shall supply to Baxter, in a timely manner as set forth in Section 4.5 Component Delivery Delays. Baxter shall procure, in a timely manner, and have available for Production of Product Baxter-supplied Components, at its sole cost and expense (including, without limitation, shipping costs), required to satisfy the terms of this Agreement. On receipt of the Components, Baxter shall test such materials as set forth in the Product Master Plan. If, notwithstanding such testing, Jazz determines to assert a claim against a supplier of a Baxter-supplied Component because Jazz discovers a defect in or adulteration of such Baxter-supplied Component that was not discovered by Baxter, Baxter agrees to provide Jazz with all information regarding such Baxter-supplied Component and the supplier thereof as Jazz shall reasonably request and to cooperate with Jazz in the assertion of each such claim.
3.3.1    Vendor/Supplier Qualification.  The responsibility for vendor/supplier qualification is set forth in the Quality Agreement.
3.3.2    Baxter-supplied Components.  Unless otherwise set forth in a Product Master Plan, Baxter will purchase the Baxter-supplied Components in sufficient quantities and with a shelf life of more than [*] at the time of Baxter’s purchase of such Baxter-supplied Components as is required to meet the greater of (a) JAZZ’s forecasted demand for Product as set forth in the [*] JAZZ’s Rolling Forecast, or (b) the minimum order quantity requirements as defined by the third-party supplier.
3.3.2.1  Unused Baxter-supplied Components.  Except in the event JAZZ previously pays for unused Baxter-supplied Components  as part of the Reservation Fees paid to Baxter resulting from the cancellation or modification of a Firm Purchase Order (as set out in Section 4.4), if any Baxter-supplied Component ordered in accordance with Section 3.3.2 is not used within [*] of Baxter’s receipt of such Component, JAZZ agrees to 

[*] = 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.

pay Baxter [*] within [*] of the date of Baxter’s invoice.  If the Baxter-supplied Components paid for by JAZZ have not expired, such Components can be booked on a JAZZ specific material number and used in the future for the Production of Product, and in this case, Baxter will rebate the corresponding cost of the Baxter-supplied Component previously paid for by JAZZ from the Batch price.
3.3.2.2    Expired Baxter-supplied Components.  Provided Baxter has met its obligations regarding shelf-life under Section 3.3.2, if any quantities of a Baxter-supplied Component ordered in accordance with Section 3.3.2 expire prior to Baxter’s use of such Component in Production of Product, [*] the expired Baxter-supplied Component and [*] the expired Component and [*].
3.3.2.3    Additional Baxter-supplied Components.  The Parties agree it is the intention of the Parties that Baxter provide additional Components for the Production of JAZZ’s Commercial Product Vyxeos, which Components are currently provided by JAZZ.  Such additional Components include [*] (“Additional Baxter-supplied Components”).  Baxter must confirm, at JAZZ’s expense, the cGMP compliance status of the suppliers of the Additional Baxter-supplied Components, pursuant to Baxter’s requirements with respect new supplier qualification, prior to Baxter providing any such Component.  If Baxter begins to provide and use any of these Additional Baxter-supplied Components in the Production of JAZZ’s Commercial Product Vyxeos, the Purchase Price of such Commercial Product will increase to include the cost of such Additional Baxter-supplied Components plus [*] of the cost of the Additional Baxter-supplied Components (as a ‘service fee’), which service fee will cover those activities as set forth in the Product Master Plan.  This Agreement will be amended to reflect such increased Purchase Price in a revised Exhibit C.  For the avoidance of doubt, once Baxter begins to procure and use the Additional Baxter-supplied Components, such Components will be considered Baxter-supplied Components and subject to this Section 3.3.2, including subsections 3.3.2.1 and 3.3.2.2.”
6.Section 4.1 “Forecasts for Clinical Product”, the last sentence beginning with “In the event Baster is unable to fill such open capacity...” is hereby deleted and replaced with the following:
“In the event Baxter is unable to fill such open capacity, Baxter may charge JAZZ a Reservation Fee as set forth in Section 4.4.”
7.Section 4.2 “Forecasts for Commercial Product” is hereby deleted and replaced with the following:

[*] = 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.

“4.2    Forecasts for Commercial Product.  Commencing no less than [*] prior to the date of the Production of the first Batch of Commercial Product, and prior to April 1 of each year thereafter, JAZZ will provide to Baxter in writing a forecast for each calendar year during the remainder of the Term of JAZZ’s estimated contract requirements for each Product (the “Long Range Forecast”).  The Long Range Forecast submitted by JAZZ will be for general planning purposes only, and shall not be binding on JAZZ or Baxter.  Commencing on 3 August 2017, and prior to the tenth (10th) day of each month thereafter, JAZZ will provide to Baxter in writing [*] rolling forecast, broken down by month, of JAZZ’s estimated requirements for the Product (the “Rolling Forecast”).  The first [*] of each Rolling Forecast shall be [*] binding on JAZZ and Baxter, subject to Section 4.2.1 (the “[*] Period”).  JAZZ shall not decrease or increase quantities of Product forecasted within the [*] Period without Baxter’s consent.  The remaining [*] months of the Rolling Forecast, i.e. months [*] through [*], shall be non-binding.
4.2.1    Upon Baxter’s receipt of each Rolling Forecast, Baxter will compare the quantities forecasted in the [*] Period to Baxter’s pro-rated Maximum Supply Obligation for such period and to the previous Rolling Forecast submitted by JAZZ.  If: (i) the quantities forecasted in the [*] Period are equal to or less than Baxter’s pro-rated Maximum Supply Obligation for such period, and provided that JAZZ has not increased its forecasted quantities in comparison to month [*] of the previous Rolling Forecast when it becomes month [*] of the [*] Period,  the quantities forecasted in the [*] Period shall be [*] binding on Baxter and JAZZ; or (ii) such quantities forecasted in the [*] Period are greater than Baxter’s pro-rated Maximum Supply Obligation for such period, Baxter will confirm to JAZZ within [*] what quantities in excess of such pro-rated Maximum Supply Obligation it is able to Produce, and such confirmed additional quantities will also be [*] binding on Baxter and JAZZ (the “Binding [*] Period”). If Baxter does not confirm its ability to Produce additional quantities within such [*] period, Baxter shall be deemed to have so confirmed and such additional quantities will be [*] binding on both Parties.”  

8.Section 4.3 including Subsection 4.3.1 “Annual Obligation for Commercial Product and Maximum Supply Obligation”, are hereby deleted and replaced with the following:
“4.3    Annual Obligation for Commercial Product and Maximum Supply Obligation. Jazz shall be obligated, upon receiving Regulatory Approval of the Product in the United States or Europe, to purchase from Baxter a minimum number of Batches of Commercial Product in each Contract Year during the Term of this Agreement (the "Annual Obligation") as set forth in Exhibit A, which Annual Obligation shall be prorated for any partial Contract Year.  For the avoidance of doubt, in each Contract Year JAZZ must order for delivery in such Contract Year the greater of (i) the Annual Obligation or (ii) the binding portion of the Rolling Forecasts for such Contract Year as set forth above in Section 4.2.1.  Within [*] after the end of each Contract Year, JAZZ shall pay Baxter for the difference between the aggregate 

[*] = 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.

Purchase Price of Product actually ordered by JAZZ for delivery pursuant to Section 4.2 in the Contract Year and the aggregate Purchase Price of the greater of (i) the Annual Obligation or (ii) the binding portion of the Rolling Forecasts. In any Contract Year during the Term of this Agreement, in no event shall Baxter be obligated to Produce more than the number of Batches set forth in Exhibit B ("Maximum Supply Obligation"); provided, however, Baxter will use commercially reasonable efforts to provide additional Batches of Product if requested by JAZZ. If changes (increase/decrease) in the annual order volume require changes in equipment and/or process, Jazz will cover the costs of such changes.” 
4.3.1    At least [*] prior to the expiration of (i) the Commercial Initial Term and (ii) each Commercial Renewal Term, the Parties, acting reasonably, shall mutually agree upon JAZZ’s Annual Obligation and Baxter’s Supply Obligation for the upcoming Commercial Renewal Term and such obligations shall be set forth in an amended Exhibit A and Exhibit B to the Agreement.  In the event the Parties are unable to reach agreement on JAZZ’s Annual Obligation Commitment and Baxter’s Supply Obligation for any Commercial Renewal Term, JAZZ’s Annual Obligation and Baxter’s Supply Obligation for such Commercial Renewal Term shall [*] or [*], as the case may be.
4.3.2    Notwithstanding the foregoing, with at least [*] prior notice, JAZZ may request an increase in its Annual Obligation for a Contract Year; which, when agreed to and confirmed in writing by Baxter with Baxter’s agreement and confirmation not to be unreasonably withheld, will result in corresponding increases in both JAZZ’s Annual Obligation and Baxter’s Maximum Supply Obligation for such Contract Year.  Exhibits A and B will be amended at that time to reflect such increases.  
9.Exhibit A “JAZZ’s ANNUAL OBLIGATION” and Exhibit B “BAXTER’s MAXIMUM SUPPLY OBLIGATION” are hereby deleted in their entirety and replaced with the Exhibits A and B attached to this Amendment No. 1.
10.Section 4.4 “Purchase Orders”, the second sentence only of the first paragraph beginning “JAZZ shall not, without the written consent of Baxter,...” is hereby deleted and replaced with the following sentence:
“JAZZ shall not, without the written consent of Baxter, designate a requested pick-up date in a Purchase Order earlier than [*] from the date JAZZ submits the Purchase Order.”
11.Section 4.4 “Purchase Orders”, the final two paragraphs beginning with “In the event that JAZZ modifies or cancels a Firm Purchase Order...” are hereby deleted and replaced with the following two paragraphs:
“In the event that JAZZ modifies or cancels a Firm Purchase Order through no fault of Baxter, without Baxter’s written consent (which shall not be unreasonable withheld or 

[*] = 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.

delayed), Baxter may charge JAZZ [*] for each modified or cancelled Batch (a “Reservation Fee”) [*]. The term “modifies” and “modified” herein shall mean modification which prevents Baxter’s Production of a Batch within the scheduled Production slot; provided, however, if the modification is insignificant and Baxter is able to Produce the Batch according to such modification without any material impact to its manufacturing schedule (e.g. Baxter left with open capacity in its manufacturing schedule) and without preventing Baxter’s manufacturing of any third party’s product, then Baxter will not charge JAZZ a Reservation Fee. 
JAZZ shall order full batches of Product on a single Purchase Order, either as single batches or as part of a Campaign(s).”    
12.Section 4.5 “Component Delivery Delay” is hereby deleted and replaced with the following:
“4.5    Component Delivery Delays.  Timely delivery of JAZZ-supplied Components shall mean that the respective Component and the documents required under the Product Master Plan arrive at Baxter at least [*] business days prior to the scheduled manufacturing date of such Product, as determined by the date set forth in the Firm Purchase Order.  Notwithstanding anything in this Agreement to the contrary, in the event that Baxter receives such JAZZ-supplied Components and associated cGMP documents for the Production of Product from JAZZ less than [*] business days prior to the scheduled manufacturing date of such Product, Baxter shall use commercially reasonable efforts to reschedule Batch within [*] days after receipt. [*], Baxter may charge JAZZ a Reservation Fee as defined in Section 4.4.” 
13.Section 5.1 “Purchase Price” is hereby deleted and replaced with the following:
“5.1    “Purchase Price.  The price to be paid by JAZZ for the Production of Product (the “Purchase Price”) shall be set forth in the Exhibit C.  The Purchase Price includes the cost of the Baxter-supplied Components.  For each Batch of Commercial Product Produced in a Campaign, the Purchase Price of each such Batch will be reduced by the amount as set forth in Exhibit C.”
14.Section 5.2 “Production Price Adjustment for Commercial Product”, is hereby deleted and replaced with the following:
“5.2    Purchase Price Adjustment for Commercial Product. On January 1, 2019, Baxter shall adjust the Purchase Price of Commercial Product to reflect changes in Baxter’s actual costs since the date on which the Production Price was last established, but in an amount not to exceed [*] (i) the percentage increase in the Index of Producer Prices of Industrial Products during the previous twelve (12) month period as published by the Federal Statistical Office of Germany (www.destatis.de) and (ii) [*].  Commencing on January 1, 2020 and on each January 1 thereafter during the Term, Baxter shall adjust the Purchase Price of Commercial Product in an amount not to exceed the percentage increase in the Index of Producer Prices of Industrial 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.

during the previously twelve (12) month period as published by the Federal Statistical Office of Germany (www.destatis.de).  In addition to the foregoing increases, increases by third party suppliers in the price of Baxter-supplied Components used in the Production of Product may also result in increases in the Purchase Price.  Written notification of all increases to the Purchase Price will be sent by Baxter to JAZZ. In the event Baxter provides written notification to JAZZ of a price increase due to third party supplier price increases, Baxter will support this by providing supporting supplier verification, prior to implementation of such increases. 
15.Section 7.2.2B is hereby deleted and replaced with the following;
“7.2.2B     In the event Baxter agrees that Commercial Product is non-conforming to the Product Requirements, or the laboratory or consultant determines that such Commercial Product is non-conforming, JAZZ shall provide replacement JAZZ-supplied Components, including API, and any other JAZZ supplied materials to Baxter, at JAZZ’s expense, and Baxter shall replace such non-conforming Commercial Product as soon as possible assuming sufficient JAZZ-supplied Components, including API, and any other JAZZ supplied materials are available or will be provided by JAZZ in due time to carry out the Production.  Baxter is not responsible to replace non-conforming Commercial Product in accordance with this Section 7.2.2B, if such non-conformance arises out of, is caused by or relates to any of the following:

[*]

In the event a Batch of Commercial Product is non-conforming, provided Baxter has not already done so in accordance with Section 7.1.2 above, Baxter shall duly investigate such non-conformity and the parties will mutually determine a corrective action plan within [*] calendar days after the Parties determine or agree that the Batch is non-conforming or such additional time as is reasonably required if such investigation or plan requires data from sources other than JAZZ or Baxter. If after such investigation, a root cause for such nonconformance cannot be determined, the Parties shall refer the matter to a mutually acceptable laboratory or consultant for investigation, whose determination of root cause shall be binding upon the Parties and the costs of such laboratory or consultant are to be borne by the Party who caused such nonconformance. If such laboratory or consultant cannot determine a root cause for such nonconformance [*]. 
16.Section 8.1 “Term” is hereby deleted and replaced with the following:
“8.1     Term.    Unless terminated pursuant to Section 8.2 herein, this Agreement shall commence on the Effective Date and will continue until the development and clinical Production have been completed, as described in the Product Master Plan for clinical Production (the “Clinical Term”) and shall continue in effect thereafter for commercial Production until the expiration of the fifth (5th) Contract Year (the “Commercial Initial Term”).  This Agreement will be thereafter renewed automatically for further successive periods of three (3) years each (each a “Commercial Renewal Term”) unless either JAZZ or Baxter terminates the Agreement by giving 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.

written notice of intent to terminate at least twenty-four months prior to the expiration of the Commercial Initial Term or prior to the expiration of the Commercial Renewal Term, as applicable.  The Commercial Initial Term and the Commercial Renewal Term(s) are collectively referred to herein as the “Commercial Term”.  The Clinical Term and the Commercial Term are collectively referred to as the “Term”.
17.Section 8.5 “Payment on Termination of Commercial Production”, all references to “Production Price” in Section 8.5 are hereby changed to “Purchase Price”.
18.The following is hereby added to the Agreement as a new Section 8.7.2:
“8.7.2    If at any time during the Term JAZZ requests Baxter’s assistance to help JAZZ set up a secondary supplier to manufacture Product, the Parties will in good faith and acting reasonably, mutually agree at that time, in writing, if and to what extent Baxter will assist.
19.Section 12.2 “Baxter Warranty”, the first sentence is hereby deleted and replaced with the following:
“Baxter represents and warrants that (i) it shall Produce all Product in accordance with cGMP and (ii) subject to Section 7.2.2B(i), all Commercial Product shall meet Product Specifications.”
20.Capitalized terms used herein that are not defined herein shall have the defined meaning set forth in the Agreement.
21.Except as modified by this Amendment No. 1, the terms of the Agreement shall continue in full force and effect.
22.This Amendment No. 1 may be executed in counterparts and all of such counterparts taken together shall be deemed one and the same instrument.  Any photocopy, facsimile, or pdf of the executed Amendment No. 1 shall constitute an original.  

{Signatures on Next Page}

[*] = 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.

IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to be duly authorized, executed, and delivered as of the Amendment No. 1 Effective Date.

	
					
	BAXTER ONCOLOGY GmbH
	 
	JAZZ PHARMACEUTICALS IRELAND LIMITED

	 

	 

	By:
	/s/ Dr Sven Remmerbach
	 
	By:
	/s/ Aoife Campbell

	Title:
	Director BDCM
	 
	Title:
	VP, Strategy & Corporate Development

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	And
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	By:
	/s/ Jurgen Fleischer
	 
	 
	 

	Title:
	Director Human Resources & EHS
	 
	 
	 

[*] = 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.

EXHIBIT A
JAZZ’s ANNUAL OBLIGATION

	
			
	Contract Years
	 
	Annual Obligation

	Contract Year One
	 
	[*]

	Contract Year Two
	 
	[*]

	Contract Year Three
	 
	[*]

	Contract Year Four
	 
	[*]

	Contract Year Five
	 
	[*]

Note:  For any Commercial Renewal Term, the parties will mutually agree upon an Annual Obligation as set forth in Section 4.3.1. 

[*] = 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.

EXHIBIT B
BAXTER’S MAXIMUM SUPPLY OBLIGATION

	
			
	Contract Year
	 
	Maximum Supply Obligation

	Contract Year One
	 
	[*]

	Contract Year Two
	 
	[*]

	Contract Year Three
	 
	[*]

	Contract Year Four
	 
	[*]

	Contract Year Five
	 
	[*]

Note:  For any Commercial Renewal Term, the parties will mutually agree upon Baxter’s Maximum Supply Obligation as set forth in Section 4.3.1.

[*] = 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.

EXHIBIT C
PURCHASE PRICE
BAXTER shall charge JAZZ for Product as set forth in the table below plus any occurring Value-Added Taxes (if applicable) (ready for shipment). 
	
			
	Clinical / Commercial Batches

	Batch size
	Number of batches
	Purchase Price per Batch (includes the cost of the Baxter-supplied Components

	Up to [*]
	See Exhibit A of the Agreement for the manufacturing of commercial batches

	[*]

	Campaign Manufacturing
	At least [*] in sequence as defined in the Agreement*

	[*]

[*]

The Purchase Price includes Baxter costs for keeping the suppliers of Baxter-supplied Components in an adequate state of qualification.
Associated Batch specific costs: Batch specific selection of sterile filters and bioburden filters and the costs of such filters, including without limitation the testing of such filters, will be set forth in the Product Master 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.

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