Document:

EX-10.2

 Exhibit 10.2 

TAX MATTERS AGREEMENT 
 by and
between 
 RECRO PHARMA, INC. 

and 
 BAUDAX BIO, INC. 

Dated as of                , 2019 

 TAX MATTERS AGREEMENT 

THIS TAX MATTERS AGREEMENT (this “Agreement”), dated as
of                , 2019 by and between Recro Pharma, Inc., a Pennsylvania corporation (“Recro”), and Baudax Bio, Inc., a Pennsylvania corporation
(“Baudax”). Each of Recro and Baudax is sometimes referred to herein as a “Party” and, collectively, as the “Parties”. Capitalized terms used and not defined herein shall have the meaning set forth
in the Separation Agreement entered into between the Parties as of the date hereof (the “Separation Agreement”). 

WHEREAS, Recro, acting through itself and its direct and indirect Subsidiaries, currently conducts the CDMO Business and the Acute Care
Business; 
 WHEREAS, the Board has determined that it is appropriate, desirable and in the best interests of Recro to separate the
CDMO Business from the Acute Care Business, and to divest the Acute Care Business in the manner contemplated by the Separation Agreement; 

WHEREAS, pursuant to the Separation Agreement (a) to the extent not previously effected pursuant to the Internal Reorganization,
Recro will, and will cause its Subsidiaries to transfer certain assets and liabilities of the Acute Care Business to Baudax, as a result of which Baudax will own, directly and indirectly through its Subsidiaries, the Acute Care Business
(collectively, the “Restructuring”), and (b) Recro will distribute, on a pro rata basis, all of the issued and outstanding shares of Baudax Common Stock owned by Recro to the holders of Recro Common Stock (the
“Distribution”) as described therein; and 
 WHEREAS, the Parties wish to provide for the payment of Tax liabilities
and entitlement to Refunds thereof, allocate responsibility for, and cooperation in, the filing of Tax Returns, and provide for certain other matters relating to Taxes. 

NOW, THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and agreements contained herein, and
intending to be legally bound hereby, the Parties agree as follows: 
 ARTICLE I 

DEFINITIONS 

Section 1.1.    General. As used in this Agreement, the following terms shall have the following meanings:

 “Accounting Firm” has the meaning set forth in Section 7.1. 

“Adjustment” means an adjustment of any item of income, gain, loss, deduction, credit or any other item affecting Taxes of a
taxpayer pursuant to a Final Determination. 
 “Baudax Entity” means any Subsidiary of Baudax immediately after the
Distribution. 
 “Baudax Group” means, individually or collectively, as the case may be, Baudax and any Baudax Entity. 

 

  
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 “Baudax Ireland” means Baudax Ireland Limited, an Irish limited company.

 “Code” means the Internal Revenue Code of 1986, as amended. 

“Common Parent” means the common parent corporation of an affiliated group (in each case, within the meaning of
Section 1504 of the Code) filing a U.S. federal consolidated Income Tax Return. 
 “Contribution” means the
contribution, directly or indirectly, by Recro of all of the assets of the Acute Care Business to Baudax in exchange for all of the Baudax Common Stock and the assumption by Baudax of liabilities related thereto. 

“Distribution Date” means the date on which the Distribution is effective. 

“Due Date” means (a) with respect to a Tax Return, the date (taking into account all valid extensions) on which such Tax
Return is required to be filed under applicable Law and (b) with respect to a payment of Taxes, the date on which such payment is required to be made to the applicable Taxing Authority to avoid the incurrence of interest penalties and/or
additions to Tax. 
 “Extraordinary Transaction” means any action that is not in the Ordinary Course of Business, but shall
not include (a) any action described in or contemplated by the Separation Agreement or any Ancillary Agreement, or (b) any action that is undertaken pursuant to the Restructuring or the Distribution. 

“Final Determination” means the final resolution of liability for any Tax for any taxable period, by or as a result of
(a) a final decision, judgment, decree or other order by any court of competent jurisdiction that can no longer be appealed to a court other than the Supreme Court of the United States, (b) a final settlement with the IRS, a closing
agreement or accepted offer in compromise under Sections 7121 or 7122 of the Code, or a comparable agreement under the Laws of other jurisdictions, which resolves the entire Tax liability for any taxable period, (c) any allowance of a Refund or
credit in respect of an overpayment of Tax, but only after the expiration of all periods during which such Refund or credit may be recovered by the jurisdiction imposing the Tax, or (d) any other final resolution, including by reason of the
expiration of the applicable statute of limitations or the execution of a pre-filing agreement with the IRS or other Taxing Authority. 

“Income Tax Return” means any Tax Return on which Income Taxes are reflected or reported. 

“Income Taxes” means any net income, net receipts, net profits, excess net profits or similar Taxes based upon, measured by,
or calculated with respect to net income. 
 “Indemnified Party” means the Party which is entitled to seek indemnification
from the other Party pursuant to the provisions of Article III. 
 “Indemnifying Party” means the Party from which
the other Party is entitled to seek indemnification pursuant to the provisions of Article III. 
  

  
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 “Information” has the meaning set forth in
Section 5.1(a). 
 “Ireland Loan” has the meaning set forth in
Section 4.2(a)(i). 
 “IRS” means the United States Internal Revenue Service. 

“Ordinary Course of Business” means an action taken by a Person only if such action is taken in the ordinary course of the
normal operations of such Person. 
 “Past Practice” means past practices, accounting methods, elections and conventions.

 “Post-Closing Period” means any taxable period (or portion thereof) beginning after the Distribution Date, including the
portion of any Straddle Period beginning on the day after the Distribution Date. 

“Pre-Closing Period” means any taxable period (or portion thereof) ending on or
before the Distribution Date, including the portion of any Straddle Period through the end of the Distribution Date. 
 “Recro
Consolidated Return” means the U.S. federal Income Tax Return required to be filed by Recro as the Common Parent. 
 “Recro
Consolidated Taxes” means any U.S. federal Income Taxes attributable to any Recro Consolidated Return. 
 “Recro
Entity” means any Subsidiary of Recro immediately after the Distribution. 
 “Recro Group” means, individually or
collectively, as the case may be, Recro and any Recro Entity, excluding any member of the Baudax Group. 
 “Recro Taxes”
means, without duplication, (a) any Recro Consolidated Taxes, (b) any Taxes imposed on Baudax or any member of the Baudax Group under Treasury Regulations Section 1.1502-6 (or any similar
provision of other Law) as a result of Baudax or any such member being or having been included as part of a Recro Consolidated Return or a Recro Unified Tax Return, (c) any Taxes of the Recro Group and any former Subsidiary of Recro (excluding
any member of the Baudax Group) for any Pre-Closing Period, (d) any Recro Transaction Taxes, and (e) any Recro Unified Taxes. 

“Recro Transaction Taxes” means any Taxes imposed on or by reason of the Restructuring or the Distribution (including
Transfer Taxes and Taxes payable by reason of deferred intercompany transactions or excess loss accounts triggered by the Contribution or the Distribution). 

“Recro Unified Tax Return” means any unified, combined, consolidated or similar Tax Returns (other than the Recro
Consolidated Tax Return) which includes or included Recro and Baudax. 
  

  
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 “Recro Unified Taxes” means any state or local Taxes attributable to a
Recro Unified Tax Return. 
 “Refund” means any refund (or credit in lieu thereof) of Taxes (including any overpayment of
Taxes that can be refunded or, alternatively, applied to other Taxes payable) including any interest paid on or with respect to such refund of Taxes. 

“Retention Period” has the meaning set forth in Section 6.2. 

“Straddle Period” means any taxable period that begins on or before and ends after the Distribution Date. 

“Tax” or “Taxes” means all taxes, charges, fees, duties, levies imposts, or other similar assessments,
imposed by any U.S. federal, state or local or foreign governmental authority, including net income, gross income, gross receipts, excise, real property, personal property, sales, use, service, service use, license, lease, capital stock, transfer,
recording, franchise, business organization, occupation, premium, environmental, windfall profits, profits, customs, duties, payroll, wage, withholding, social security, employment unemployment, insurance, severance, workers compensation, excise,
stamp, alternative minimum, estimated, value added, ad valorem, hospitality, accommodations, transient accommodations unclaimed property, escheat and other taxes, charges, fees, duties, levies, imposts, or other similar assessments, and any interest
penalties or additions attributable thereto. 
 “Tax Attributes” means net operating losses, capital losses, tax credit
carryovers earnings and profits, foreign tax credit carryovers, overall foreign losses, previously taxed income, tax bases, separate limitation losses and any other losses, deductions, credits or other comparable items that could affect a Tax
liability for a past or future taxable period. 
 “Tax Benefit” means any Refund, credit, or other reduction in Tax
payments otherwise required to be made to a Taxing Authority, including for the avoidance of doubt, any actual Tax savings if, as and when realized arising from a step-up in Tax basis or an increase in a Tax
Attribute. 
 “Tax Cost” means any increase in Tax payments otherwise required to be made to a Taxing Authority (or any
reduction in any Refund otherwise receivable from any Taxing Authority). 
 “Tax Group” means the members of a consolidated
combined, unitary or other tax group (determined under applicable U.S., State or foreign Income Tax law) which includes Recro or Baudax, as the context requires recognizing that (i) Recro’s Tax Group does not include any members of the
Baudax Group and (ii) Baudax’s Tax Group does not include any members of the Recro Group. 
 “Tax Item” means any
item of income, gain, loss, deduction, credit, recapture of credit or any other item which increases or decreases Taxes paid or payable. 

“Tax Matter” has the meaning set forth in Section 6.1(a). 

 

  
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 “Tax Proceeding” means any audit, assessment of Taxes, pre-filing agreement, other examination by any Taxing Authority, proceeding, appeal of a proceeding or litigation relating to Taxes, whether administrative or judicial including proceedings relating to competent
authority determinations. 
 “Tax Return” means any return, report, certificate, form or similar statement or document
(including any related or supporting information or schedule attached thereto and any information return, or declaration of estimated Tax) required to be supplied to, or filed with, a Taxing Authority in connection with the payment, determination,
assessment or collection of any Tax or the administration of any Laws relating to any Tax and any amended Tax Return or claim for Refund. 

“Taxing Authority” means any governmental authority or any subdivision agency commission or entity thereof or any
quasi-governmental or private body having jurisdiction over the assessment determination collection or imposition of any Tax (including the IRS). 

“Transfer Taxes” means all sales, use, transfer, real property transfer intangible, recordation, registration, documentary,
stamp or similar Taxes imposed on the Restructuring or the Distribution. 
 “Treasury Regulations” means the final and
temporary (but not proposed) Income Tax regulations promulgated under the Code; as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations). 

“U.S.” means the United States of America. 

ARTICLE II 
 PREPARATION,
FILING AND PAYMENT OF TAXES SHOWN DUE ON TAX RETURNS 
 Section 2.1.    Recro Consolidated Returns. 

(a)    Recro Consolidated Returns. Recro shall prepare, or cause to be prepared, and file all Recro Consolidated Returns
for any Pre-Closing Period and a Straddle Period and shall pay all Taxes shown to be due and payable on such Tax Returns. 

(b)    Extraordinary Transactions. For all Tax purposes, the Parties shall report any Extraordinary Transactions that are
caused or permitted by Baudax or any Baudax Entity on the Distribution Date after the Distribution as occurring on the day after the Distribution Date pursuant to Treasury Regulation Section 1.1502-76(b)
(1)(ii)(B) or any similar or analogous provision of state, local or foreign Law. 
 Section 2.2.    Recro Unified
Tax Returns. Recro shall prepare and file any Recro Unified Tax Returns for a Pre-Closing Period and shall pay all Taxes shown to be due and payable on such Tax Returns. 

Section 2.3.    Tax Return Procedures. 

 

  
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 (a)    Recro Consolidated Returns. To the extent that the positions
taken on any Recro Consolidated Tax Return would reasonably be expected to materially and adversely affect the Tax position of Baudax or a Baudax Entity for any period after the Distribution Date, Recro shall prepare the portions of such Tax Return
that relates to the Acute Care Business in a manner that is consistent with Past Practice unless otherwise required by applicable Law or agreed to in writing by the Parties, and shall provide a draft of such portion of such Tax Return to Baudax for
its review and comment at least forty five (45) days prior to the Due Date for such Tax Return. In the event that Past Practice is not applicable to a particular item or matter, Recro shall determine the reporting of such item or matter in good
faith. The Parties shall negotiate in good faith to resolve all disputed issues. Any disputes that the Parties are unable to resolve shall be resolved by the Accounting Firm pursuant to Section 7.1. In the event that any
dispute is not resolved (whether pursuant to good faith negotiations among the Parties or by the Accounting Firm) prior to the Due Date for the filing of any such Tax Return, such Tax Return shall be timely filed by Recro and Recro agrees to amend
such Tax Return as necessary to reflect the resolution of such dispute in a manner consistent with such resolution. All Recro Consolidated Returns will be prepared in accordance with Section 4.2, below. 

(b)    Recro Unified Tax Returns. Recro shall prepare and file the Recro Unified Tax Returns for the taxable year that
includes the Distribution Date. To the extent that the positions taken on any Recro Unified Tax Return would reasonably be expected to materially and adversely affect the Tax position of Baudax, Recro shall prepare the portions of such Tax Return
that relates to the Acute Care Business in a manner that is consistent with Past Practice unless otherwise required by applicable Law or agreed to in writing by the Parties, and shall provide a draft of such portion of such Tax Return to Baudax for
its review and comment at least forty five (45) days prior to the Due Date for such Tax Return, provided, however, that nothing herein shall prevent Recro from timely filing any such Tax Return. In the event that Past Practice is not applicable
to a particular item or matter, Recro shall determine the reporting of such item or matter in good faith. The Parties shall negotiate in good faith to resolve all disputed issues. Any disputes that the Parties are unable to resolve shall be resolved
by the Accounting Firm pursuant to Section 7.1. In the event that any dispute is not resolved (whether pursuant to good faith negotiations among the Parties or by the Accounting Firm) prior to the Due Date for the filing of
any such Tax Return, such Tax Return shall be timely filed by Recro, and Recro agrees to amend such Tax Return as necessary to reflect the resolution of such dispute in a manner consistent with such resolution. All Recro Unifies Tax Returns will be
prepared in accordance with Section 4.2, below. 
 Section 2.4.    Amended Returns. Except as provided
in Section 2.3 to reflect the resolution of any dispute by the Accounting Firm pursuant to Section 7.1, except with the prior written consent of Baudax (such consent not to be unreasonably
withheld, delayed or conditioned), Recro shall not, and shall not permit any Recro Entity to, amend any Tax Return for any Pre-Closing Period to the extent such amendment could reasonably be expected to
increase the Taxes of any member of the Baudax Group. 
 Section 2.5.    Timing of Payments. All Taxes
required to be paid or caused to be paid pursuant to this Article II by either Recro or a Recro Entity or Baudax or a Baudax Entity, as the case may be, to an applicable Taxing Authority, shall be paid on or before the Due Date for the
payment of such Taxes. 

  
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 Section 2.6.    Expenses. Except as provided in
Section 7.1 in respect of the expenses relating to the Accounting Firm, each Party shall bear its own expenses incurred in connection with this Article II. 

Section 2.7.    Distribution Tax Reporting. The Parties shall cause the Distribution to be reported to holders
of Recro Common Stock on IRS Form 1099-Div, or 1042-S, as appropriate. The Parties shall not take any position on any U.S. federal or state Income Tax Return or take any
other U.S. tax reporting position that is inconsistent with the treatment of the Distribution as a distribution to which Section 301 of the Code applies, except as otherwise required by applicable Law. Recro will cause the Distribution Agent to
comply with Section 1441 and Section 1442 of the Code, on the basis that the Distribution is a dividend as defined in Section 316 of the Code. 

ARTICLE III 

INDEMNIFICATION 

Section 3.1.    Indemnification by Recro. Subject to Section 3.3, Recro shall pay,
and shall indemnify and hold the Baudax Group harmless from and against, without duplication, (a) Recro Taxes, (b) all Taxes incurred by Baudax or any Baudax Entity arising out of, attributable to, or resulting from the breach by Recro of
any of its covenants hereunder, and (c) any out-of-pocket costs and expenses related to the foregoing (including reasonable attorneys’ fees and expenses). 

Section 3.2.    Indemnification by Baudax. Subject to Section 3.3, Baudax shall pay,
and shall indemnify and hold the Recro Group harmless from and against, without duplication, (a) all Taxes incurred by Recro or any Recro Entity arising out of, attributable to, or resulting from the breach by Baudax of any of its covenants
hereunder, and (b) any out-of-pocket costs and expenses related to the foregoing (including reasonable attorneys’ fees and expenses). 

Section 3.3.    Characterization of and Adjustments to Payments. 

(a)    For all Tax purposes, Recro and Baudax shall treat any payment by Recro to a member of the Baudax Group or by
Baudax to a member of the Recro Group required by this Agreement (other than payments with respect to interest accruing after the Distribution Date) as either a contribution by Recro to Baudax or a distribution by Baudax to Recro, as the case may
be, and, in each case, as occurring immediately prior to the Distribution. 
 (b)    Notwithstanding the foregoing, the
amount that any Indemnifying Party is or may be required to provide indemnification to or on behalf of any Indemnified Party pursuant to this Article III shall be (i) decreased to take into account any Tax Benefit to the Indemnified
Party (or any of its Affiliates) arising from the incurrence or payment of the relevant indemnified item and actually realized in or prior to the taxable year succeeding the taxable year in which the indemnified item is incurred (which Tax Benefit
would not have arisen or been allowable but for such indemnified item), and (ii) increased to take into account any actual Tax Cost of the Indemnified Party (or any of its Affiliates) arising from the receipt of the relevant indemnity payment.

  

  
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 Section 3.4.    Timing of Indemnification Payments.
Indemnification payments in respect of any liabilities for which an Indemnified Party is entitled to indemnification pursuant to this Article III shall be paid by the Indemnifying Party to the Indemnified Party within ten (10) days after
written notification thereof by the Indemnified Party, including reasonably satisfactory documentation setting forth the basis for, and calculation of, the amount of such indemnification payment, or within ten (10) days after resolution
pursuant to Section 7.1. 
 ARTICLE IV 

REFUNDS AND TAX ATTRIBUTES 

Section 4.1.    Refunds and Credits. Recro shall be entitled to all Refunds of Taxes for which Recro is
responsible pursuant to Article II, and Baudax shall be entitled to all Refunds of Taxes for which Baudax is responsible pursuant to Article II. 

Section 4.2.    Attributes. 

(a)    As soon as reasonably practicable after the Distribution Date, Recro shall reasonably determine in good faith the
allocation of Tax Attributes, arising in a Pre-Closing Period, between the Recro Group and the Baudax Group in accordance with the Code and Treasury Regulations, including any applicable state, local and
foreign Tax Laws. Subject to the preceding sentence, Recro shall be entitled to make any determination as to (i) basis, and (ii) valuation, and shall make such determinations reasonably and in good faith and consistent with Past Practice.
Recro shall consult in good faith with Baudax regarding such allocation of Tax Attributes and determinations as to basis and valuation, and shall consider in good faith any comments received in writing from Baudax regarding such allocation and
determinations. Recro and Baudax hereby agree to compute all Taxes for Post-Closing Periods consistently with the determination of the allocation of Tax Attributes pursuant to this Section 4.2(a) unless otherwise required
by a Final Determination. Notwithstanding anything to the contrary in this Agreement, it is agreed that: 
 (i)    For
all Pre-Closing Tax Periods, the Recro Group will treat the historical advances (the “Ireland Loan”) provided by Recro to Baudax Ireland as indebtedness of Baudax Ireland for U.S. federal
Income Tax purposes, and 
 (ii)    The Recro Group will treat the cancellation of the Ireland Loan, effective on
July 12, 2019, prior to the close of business, as giving rise to (a) a partial bad debt deduction to Recro under Section 166(a) of the Code equal to Recro’s unrecovered basis in the Ireland Loan and (b) a capital
contribution from Recro to Baudax, equal to the fair market value of Baudax Ireland’s assets. 
 (b)    To the
extent that the amount of any Tax Attribute is later reduced or increased by a Taxing Authority or Tax Proceeding, such reduction or increase shall be allocated to the Party to which such Tax Attribute was allocated pursuant to
Section 4.2(a). 
 ARTICLE V 

TAX PROCEEDINGS 

Section 5.1.    Notification of Tax Proceedings. Within ten (10) days after an Indemnifying Party becomes
aware of the commencement of a Tax Proceeding that may give rise 

  
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to Taxes for which the Indemnifying Party is responsible pursuant to Article II, the Indemnifying Party shall notify the Indemnified Party of such Tax Proceeding, and thereafter shall
promptly forward or make available to the Indemnifying Party copies of notices and communications relating to such Tax Proceeding. The failure of the Indemnified Party to notify the Indemnifying Party of the commencement of any such Tax Proceeding
within such ten (10) day period or promptly forward any further notices or communications shall not relieve the Indemnifying Party of any obligation which it may have to the Indemnified Party under this Agreement except to the extent that the
Indemnifying Party is prejudiced by such failure. 
 Section 5.2.    Tax Proceeding Procedures Generally.
Recro shall be entitled to contest, compromise, control and settle any Adjustment or deficiency proposed, asserted or assessed pursuant to any Tax Proceeding with respect to any Recro Consolidated Return or Recro Unified Tax Return, provided that to
the extent such Tax Proceeding could reasonably be expected to adversely affect the amount of Taxes for which Baudax is responsible, Recro shall (a) defend such Tax Proceeding diligently and in good faith (b) keep Baudax informed in a
timely manner of all actions proposed to be taken by Recro with respect to such Tax Proceeding, and (c) in good faith consider any input from Baudax with respect to such Tax Proceeding. 

ARTICLE VI 
 COOPERATION

 Section 6.1.    General Cooperation. 

(a)    The Parties shall each cooperate fully (and each shall cause its respective Subsidiaries to cooperate fully) with
all reasonable requests in writing from another Party hereto, or from an agent, representative or advisor to such Party, in connection with the preparation and filing of Tax Returns, claims for Refunds, Tax Proceedings, and calculations of amounts
required to be paid pursuant to this Agreement, in each case, related or attributable to or arising in connection with Taxes of either of the Parties or their respective Subsidiaries covered by this Agreement and in connection with any financial
reporting matter relating to Taxes (a “Tax Matter”). Such cooperation shall include the provision of any information reasonably necessary or helpful in connection with a Tax Matter (“Information”) and shall include,
without limitation: 
 (i)    the provision of any Tax Returns, other than any Recro Consolidated Return or Recro
Unified Tax Return that does not include Baudax , of the Parties and their respective Subsidiaries, books, records (including information regarding ownership and Tax basis of property), documentation and other information relating to such Tax
Returns, including accompanying schedules, related work papers, and documents relating to rulings or other determinations by Taxing Authorities; 

(ii)    the use of the Party’s reasonable best efforts to obtain any documentation in connection with a Tax Matter;

 (iii)    the use of the Party’s reasonable best efforts to obtain any Tax Returns (including accompanying
schedules, related work papers, and documents) (other than any Recro Consolidated Return), documents, books, records or other information in connection with the filing of any Tax Returns of either of the Parties or their Subsidiaries; and 

  
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 (iv)    the making of each Party’s employees, advisors, and
facilities available on a reasonable and mutually convenient basis in connection with the foregoing matters. 

(b)    Notwithstanding anything in this Agreement to the contrary, neither Party shall be required to provide the other
Party or any of such other Party’s Subsidiaries access to or copies of information, documents or personnel if such action could reasonably be expected to result in the waiver of any Privilege. In the event that either Party determines that the
Provision of any information or documents to the other Party or any of such other Party’s Subsidiaries could be commercially detrimental, violate any Law or agreement or waive any privilege, the Parties shall use commercially reasonable efforts
to permit compliance with its obligations hereunder in a manner that avoids any such harm or consequence. 
 (c)    The
Parties shall perform all actions required or permitted under this Agreement in good faith. If one Party requests the cooperation of the other Party pursuant to this Section 6.1 or any other provision of this Agreement,
except as otherwise expressly provided in this Agreement, the requesting Party shall reimburse such other Party for all reasonable out-of-pocket costs and expenses
incurred by such other Party in complying with the requesting Party’s request. 
 Section 6.2.    Retention
of Records. Recro and Baudax shall retain or cause to be retained all Tax Returns, schedules and work papers and all material records or other documents relating thereto in their possession, in each case that relate to a Pre-Closing Period until the later of the six-year anniversary of the filing of the relevant Tax Return or, upon the written request of the other Party, for a reasonable time
thereafter (the “Retention Period”). Upon the expiration of the Retention Period, the foregoing information may be destroyed or disposed of by the Party retaining such documentation or other information unless the other Party
otherwise requests in writing before the expiration of the Retention Period. In such case, the Party retaining such documentation or other information shall deliver such materials to the other Party or continue to retain such materials, in either
case at the expense of such other Party. 
 ARTICLE VII 

MISCELLANEOUS 

Section 7.1.    Dispute Resolution. For purposes of Article II of this Agreement, the Parties shall
appoint a nationally recognized public accounting firm reasonably acceptable to both of the Parties (the “Accounting Firm”) to resolve solely the identified disputes. In this regard, the Accounting Firm shall make determinations
with respect to the disputed items based solely on representations made by Recro and Baudax and their respective Representatives, and not by independent review, and shall function only as an expert and not as an arbitrator and shall be required to
make a determination within the ranges submitted by the Parties. The Parties shall require the Accounting Firm to resolve all disputes no later than thirty (30) days after the submission of such dispute to the Accounting Firm, and agree that
all decisions by the Accounting Firm with respect thereto shall be final and conclusive and binding on the Parties. The Accounting Firm shall resolve all disputes in a manner consistent with this Agreement and, to the extent not inconsistent with
this Agreement, in a manner consistent with the Past Practices of Recro, except as otherwise required by applicable Law. The Parties shall require the Accounting Firm to render 

  
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all determinations in writing and to set forth, in reasonable detail, the basis for such determination. The total costs and expenses of the Accounting Firm will be allocated and borne between
Recro and Baudax based upon that percentage or such fees and expenses equal to the percentage of the dollar value of the proposed determinations submitted to the Accounting Firm determined in favor of the other Party; provided, that if in light of
the nature of the dispute the foregoing is not feasible, such costs and expenses shall be borne equally by the Parties. Any initial retainer required by the Accounting Firm shall be funded equally by the Parties (and, following the Accounting
Firm’s determination, the Parties shall make appropriate payments between themselves as are necessary to give effect to the preceding sentence). 

Section 7.2.    Interest on Late Payments. With respect to any payment between the Parties pursuant to this
Agreement not made by the due date set forth in this Agreement for such payment (and any amount billed or otherwise invoiced or demanded and properly payable that is not paid within sixty (60) days of such bill, invoice or other demand) shall
bear interest at a rate per annum equal to the Prime Rate, from time to time in effect, plus two percent (2%), calculated for the actual number of days elapsed, accrued from the date on which such payment was due up to the date of the actual receipt
of payment. 
 Section 7.3.    Survival of Covenants. Except as otherwise contemplated by this Agreement,
all covenants and agreements of the Parties contained in this Agreement shall survive the Distribution and remain in full force and effect in accordance with their applicable terms. 

Section 7.4.    Successors. This Agreement shall be binding on and inure to the benefit of any successor by
merger, acquisition of assets, or otherwise, to either of the Parties hereto (including without limitation any successor of Recro or Baudax succeeding to the Tax Attributes of either under Section 381 of the Code), to the same extent as if such
successor had been an original party to this Agreement. 
 Section 7.5.    Severability. If any term or
other provision of this Agreement is invalid, illegal or incapable of being enforced under any Law or as a matter of public policy, all other conditions and provisions of this Agreement shall remain in full force and effect. Upon such determination
that any term or other provision is invalid illegal or incapable of being enforced, the Parties to this Agreement shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a
mutually acceptable manner. 
 Section 7.6.    Entire Agreement. Except as otherwise expressly provided in
this Agreement, the Separation Agreement, this Agreement and the other Ancillary Agreements constitute the entire agreement of the Parties hereto with respect to the subject matter of this Agreement and supersede all prior agreements and
undertakings, both written and oral, between or on behalf of the Parties hereto with respect to the subject matter of this Agreement. 

Section 7.7.    Assignment; No Third-Party Beneficiaries. This Agreement shall not be assigned by any Party
without the prior written consent of the other Party hereto, except that each Party may assign (a) any or all of its rights and obligations under this Agreement to any of its Subsidiaries and (b) any or all of its rights and obligations
under this Agreement in connection with a sale or disposition of any of its assets or entities or lines of business, provided, however, that, in each case, no such assignment shall release such Party from any liability or

  
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obligation under this Agreement. This Agreement is for the sole benefit of the Parties to this Agreement and their respective Subsidiaries and their permitted successors and assigns. Nothing in
this Agreement, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. 

Section 7.8.    Specific Performance. From and after the Distribution, in the event of any actual or
threatened default in, or breach of, any of the terms, conditions and provisions of this Agreement, the Party who is or is to be thereby aggrieved shall have the right of specific performance and injunctive or other equitable relief of its rights
under this Agreement, in addition to any and all other rights and remedies at law or in equity, and all such rights and remedies shall be cumulative. The Parties agree that the remedies at law for any breach or threatened breach, including monetary
damages, may be inadequate compensation for any loss and that any defense in any action for specific performance that a remedy at law would be adequate is waived. Any requirements for the securing or posting of any bond with such remedy are waived
by the Parties to this Agreement. 
 Section 7.9.    Amendment. No provision of this Agreement may be
amended or modified except by a written instrument signed by the Parties to this Agreement. No waiver by any Party of any provision of this Agreement shall be effective unless explicitly set forth in writing and executed by the Party so waiving. The
waiver by any Party of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any other subsequent breach. 

Section 7.10.    Rules of Construction. Interpretation of this Agreement shall be governed by the following
rules of construction (a) words in the singular shall be held to include the plural and vice versa and words of one gender shall be held to include the other gender as the context requires; (b) references to the terms Article, Section,
paragraph, clause, Exhibit and Schedule are references to the Articles, Sections, paragraphs, clauses, Exhibits and schedules of this Agreement, unless otherwise specified; (c) the terms “hereof,” “herein,”
“hereby,” “hereto,” and derivative or similar words refer to this entire Agreement, including the Schedules and Exhibits hereto; (d) references to $ shall mean U.S. dollars; (e) the word “including” and words
of similar import when used in this Agreement shall mean “including, without limitation,” unless otherwise specified; (f) the word “or” shall not be exclusive; (g) references to “written” or “in
writing” include in electronic form; (h) provisions shall apply, when appropriate, to successive events and transactions; (i) the headings contained in this Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement; (j) Recro and Baudax have each participated in the negotiation and drafting of this Agreement and if an ambiguity or question of interpretation should arise, this Agreement shall be construed as if
drafted jointly by the Parties hereto and no presumption or burden of proof shall arise favoring or burdening either Party by virtue of the authorship of any of the provisions in this Agreement or any interim drafts of this Agreement; and (k) a
reference to any Person includes such Person’s successors and permitted assigns. 

Section 7.11.    Counterparts. This Agreement may be executed in one or more counterparts each of which when
executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by facsimile or portable document format (PDF) shall be
as effective as delivery of a manually executed counterpart of any such Agreement. 

  
 -12- 

 Section 7.12.    Expenses. Except as otherwise provided in
this Agreement, whether or not the Distribution or the other transactions contemplated by this Agreement or the Separation Agreement are consummated, all costs and expenses incurred in connection with this Agreement and the transactions contemplated
hereby shall be paid by the Party incurring such costs or expenses. 
 Section 7.13.    Governing Law. This
Agreement shall be governed by and construed in accordance with the Laws of the Commonwealth of Pennsylvania, without giving effect to the conflicts of laws principles thereof that might lead to the application of laws other than the Laws of the
Commonwealth of Pennsylvania. 
 Section 7.14.    Notices. Any notice, demand, claim or other communication
under this Agreement will be in writing and will be deemed to have been given (a) on delivery if delivered personally, (b) on the date on which delivery thereof is guaranteed by the carrier if delivered by a national courier guaranteeing
delivery within a fixed number of days of sending, or (c) on the date of facsimile or email transmission thereof if delivery is confirmed, but, in each case, only if addressed to the Parties in the following manner at the following addresses or
facsimile numbers (or at the other address or other number as a Party may specify by notice to the others). 
 To Recro: 

Recro Pharma, Inc. 
 1300 Gould
Drive 
 Gainesville, GA 30504 

Attn: 
 Phone: 

Fax: 
 To Baudax: 

Baudax Bio, Inc. 
 490 Lapp Road

 Malvern, PA 19355 
 Attn:
Chief Financial Officer 
 Phone: 

Fax: 

Section 7.15.    Coordination with Ancillary Agreements. Except as explicitly set forth in the Separation
Agreement or any other Ancillary Agreement, this Agreement shall be the exclusive agreement among the Parties with respect to all Tax Matters, including indemnification in respect of Tax Matters. The Parties agree that this Agreement shall take
precedence over any and all agreements among the Parties with respect to Tax Matters. 

  
 -13- 

 Section 7.16.    Effective Date. This Agreement shall become
effective only upon the occurrence of the Distribution. 
 [Signature page follows] 

  
 -14- 

 IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the day
and year first above written. 
  

			
	RECRO PHARMA, INC.

 
			
		
	By:	 	  

 
			
	Name:	 	
	Title:	 	
	
	BAUDAX BIO, INC.

 
			
		
	By:	 	  

 
			
	Name:	 	
	Title:	 	

 [Signature page to Tax Matters Agreement]EX-10.3

 Exhibit 10.3 

EMPLOYEE MATTERS AGREEMENT 
 by
and between 
 RECRO PHARMA, INC. 

and 
 BAUDAX BIO, INC. 

Dated as of                , 2019 

 TABLE OF CONTENTS 

 

							
	 	 	 	  	PAGE	 
	 ARTICLE I DEFINITIONS
	  	 	1	 
	 Section 1.1.
	 	General	  	 	1	 
		
	 ARTICLE II TRANSFER OF BAUDAX EMPLOYEES; GENERAL PRINCIPLES
	  	 	3	 
	 Section 2.1.
	 	Transfer of Employment to Baudax of Additional Employees; Post-Effective Time Transfers; Independent Contractors	  	 	3	 
	 Section 2.2.
	 	Assumption and Retention of Liabilities	  	 	4	 
	 Section 2.3.
	 	Plan Participation	  	 	5	 
	 Section 2.4.
	 	No Duplication of Benefits; Service and Other Credit	  	 	5	 
	 Section 2.5.
	 	Reimbursements	  	 	6	 
	 Section 2.6.
	 	Approval of Plans	  			
		
	 ARTICLE III DEFINED CONTRIBUTION AND
NON-QUALIFIED DEFERRED COMPENSATION PLANS
	  	 	6	 
	 Section 3.1.
	 	401(k) Plan.	  	 	6	 
		
	 ARTICLE IV HEALTH AND WELFARE PLANS; PAYROLL; COBRA AND VACATION
	  	 	6	 
	 Section 4.1.
	 	Cessation of Participation in Recro H&W Plans	  	 	6	 
	 Section 4.2.
	 	Allocation of Health and Welfare Plan Liabilities	  	 	7	 
	 Section 4.3.
	 	Flexible Spending Plan Treatment	  	 	7	 
	 Section 4.4.
	 	Workers’ Compensation Liabilities	  	 	8	 
	 Section 4.5.
	 	Payroll Taxes and Reporting	  	 	8	 
	 Section 4.6.
	 	COBRA and HIPAA Compliance	  	 	9	 
	 Section 4.7.
	 	Vacation and Paid Time Off	  	 	9	 
		
	 ARTICLE V INCENTIVE COMPENSATION, EQUITY COMPENSATION AND OTHER
BENEFITS
	  	 	9	 
	 Section 5.1.
	 	Annual Cash-Based Incentive Plans	  	 	9	 
	 Section 5.2.
	 	Treatment of Equity Incentives	  	 	9	 
		
	 ARTICLE VI GENERAL AND ADMINISTRATIVE
	  	 	10	 
	 Section 6.1.
	 	Sharing of Participant Information	  	 	10	 
	 Section 6.2.
	 	No Third Party Beneficiaries	  	 	10	 
	 Section 6.3.
	 	Audit Rights with Respect to Information Provided	  	 	10	 
	 Section 6.4.
	 	Fiduciary Matters	  	 	11	 
	 Section 6.5.
	 	Consent of Third Parties	  	 	11	 
	 Section 6.6.
	 	Proprietary Information and Inventions Agreements	  	 	11	 
		
	 ARTICLE VII MISCELLANEOUS
	  	 	11	 
	 Section 7.1.
	 	General	  	 	11	 

  
 -i- 

 EMPLOYEE MATTERS AGREEMENT 

This EMPLOYEE MATTERS AGREEMENT (this “Agreement”), dated as of [●], 2019, is entered into by and between Recro Pharma,
Inc. (“Recro”), a Pennsylvania corporation, and Baudax Bio, Inc. (“Baudax”), a Pennsylvania corporation and a wholly owned subsidiary of Recro. Capitalized terms used and not defined herein shall have the meaning
set forth in the Separation Agreement between the Parties, dated as of                     , 2019 (the “Separation Agreement”). 

WHEREAS, as contemplated by the Separation Agreement, Recro and Baudax desire to enter into this Agreement to provide for the
allocation of assets, Liabilities, and responsibilities with respect to certain matters relating to employees and other individual service providers (including employee compensation and benefit plans and programs) between them. 

NOW, THEREFORE, the Parties, intending to be legally bound, agree as follows: 

ARTICLE I 

DEFINITIONS 
 
Section 1.1.    General. For purposes of this Agreement the following terms shall have the meaning ascribed to them in this Article I. 

1.1.    “Baudax 401(k) Plan” means the
tax-qualified defined contribution savings plan with a cash or deferred arrangement under Section 401(k) of the Code adopted by Baudax or a Baudax Group member and effective as of the Benefits
Commencement Date. 
 1.2.    “Baudax Employee” means any individual who, as of the Transfer
Effective Time, is either actively employed by or then on a short-term leave of absence from Baudax or a Baudax Group member (including maternity, paternity, family, sick, short-term disability leave, qualified military service under the Uniformed
Services Employment and Reemployment Rights Act of 1994, and leave under the Family Medical Leave Act and other approved leaves) or who is employed by Recro or a Recro Group member and who becomes a Baudax Employee pursuant to the operation of this
Agreement. 
 1.3.     “Baudax FSAs” has the meaning set forth in
Section 4.3. 
 1.4.    “Baudax H&W Plans” means the health and
welfare plans sponsored and maintained by Baudax or any Baudax Group member immediately prior to the Transfer Effective Time which provide group health, life, dental, accidental death and dismemberment, health care reimbursements, dependent care
assistance and disability benefits. 
 1.5.    “Baudax Participant” means any individual who is
a Baudax Employee or a Former Baudax Employee, and any beneficiary, dependent, or alternate payee of such individual, as the context requires. 

1.6.     “Benefits Commencement Date”
means                . 

1.7.    “Change of Control” has the meaning given to it under the applicable Recro Equity-Based Plan.

 1.8.    “COBRA” means the continuation coverage
requirements for “group health plans” under Title X of the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and as codified in Code Section 4980B and ERISA Sections 601 through 608. 

1.9.    “Code” means the Internal Revenue Code of 1986, as amended, or any successor federal income tax
law. Reference to a specific Code provision also includes any proposed, temporary, or final regulation in force under that provision. 

1.10.    “ERISA” means the Employee Retirement Income Security Act of 1974, as amended. Reference to a
specific provision of ERISA also includes any proposed, temporary, or final regulation in force under that provision. 

1.11.    “Former Baudax Employee” means any individual whose employment with either Party
or any of its respective Subsidiaries and Affiliates terminated for any reason before the Transfer Effective Time, and who was primarily engaged in providing services to the Acute Care Business as of the date of his or her termination of employment.

 1.12.    “Former Recro Employee” means any individual whose employment with a Recro Group member
terminated for any reason before the Transfer Effective Time, other than a Former Baudax Employee. 

1.13.    “HIPAA” means the health insurance portability and accountability requirements for “group
health plans” under the Health Insurance Portability and Accountability Act of 1996, as amended. 

1.14.    “Plan” when immediately preceded by “Recro,” means any plan, policy, program, payroll
practice, on-going arrangement, contract, trust, insurance policy or other agreement or funding vehicle (including a Recro H&W Plan) for which the eligible classes of participants include employees or
former employees of Recro or a Recro Group member (which may include employees of Baudax Group members prior to the Transfer Effective Time), and when immediately preceded by “Baudax,” means any plan, policy, program, payroll practice, on-going arrangement, contract, trust, insurance policy or other agreement or funding vehicle (including a Baudax H&W Plan) for which the eligible classes of participants are limited to employees or former
employees (and their eligible dependents) of Baudax or a Baudax Group member, but no other Recro Group member. 

1.15.    “Recro Defined Contribution Plan” means the Recro Pharma 401(k) Plan. 

1.16.    “Recro Employee” means any individual who, as of the Transfer Effective Time, is either
receiving compensation from a member of the Recro Group which is to be reported on IRS Form W-2 (in the case of individuals employed in the United States) or who is on the payroll of a Recro Group member (in
the case of individuals outside the United States), but does not include any Baudax Employee. 

1.17.    “Recro Equity-Based Plan” means the Recro 2018 Amended and Restated Equity Incentive Plan
and the Recro 2008 Stock Option Plan. 

  
 -2- 

 1.18.    “Recro FSAs” means flexible spending accounts
for health and dependent care expenses established or designated by Recro. 
 1.19.    “Recro H&W
Plans” means the health and welfare plans sponsored and maintained by Recro or any Recro Group member immediately prior to the Transfer Effective Time which provide group health, life, dental, accidental death and dismemberment, health care
reimbursements, dependent care assistance and disability benefits. 
 1.20.    “Recro Option”
means each option to acquire Recro Common Stock granted under a Recro Equity-Based Plan. 
 1.21.    “Recro
Participant” means any individual who is a Recro Employee or a Former Recro Employee, and any beneficiary, dependent, or alternate payee of such individual, as the context requires. 

1.22.    “Recro PRSU” means each award of restricted share units with respect to Recro Common Stock
granted under a Recro Equity-Based Plan subject to performance-based vesting conditions. 
 1.23.    “Recro
RSU” means each award of restricted share units with respect to Recro Common Stock granted under a Recro Equity-Based Plan (other than Recro PRSUs). 

1.24.    “Specified Employees” means the Recro Employees as of the Distribution Effective Time that are
intended to become Baudax Employees as of the Transfer Effective Time. The Specified Employees are set forth on Exhibit A to this Agreement, which may be amended after the date hereof by mutual agreement of Recro and Baudax. 

1.25.    “Specified Employee Employment Agreement” means each employment agreement with each Specified
Employee as set forth on Exhibit A. 
 1.26.    “Time-Based Award” means a Recro RSU or Recro
Option that solely vests based on the continued employment or service of the recipient. 
 1.27.    “Transfer
Effective Time” means a date, to be mutually agreed by Recro and Baudax after the Distribution Effective Time, on which the employment of Specified Employees will be transferred to Baudax. 

ARTICLE II 

TRANSFER OF BAUDAX EMPLOYEES; GENERAL PRINCIPLES 

Section 2.1.    Transfer of Employment to Baudax of Specified
Employees; Independent Contractors. 
 (a)    Following the Distribution Effective Time, the Specified Employees
will remain employees of Recro and Baudax shall compensate Recro for the services of such Specified Employees provided to Baudax pursuant to the terms of the Transition Services Agreement by and between Baudax and Recro dated as of the date hereof.
At the Transfer Effective 

  
 -3- 

 
Time, Recro and Baudax will cause the employment of the Specified Employees who are not employed by a Baudax Group member as of the Transfer Effective Time to be transferred to a Baudax Group
member. 
 (b)    In the event that the Parties determine following the Transfer Effective Time that any individual
employed outside the United States (other than an individual who the Parties intend to be a Recro Employee) has inadvertently become employed by a member of the Recro Group (due to the operation of transfer of undertakings or similar law or
regulation), the Parties shall cooperate and take such actions as may be reasonably necessary in order to cause the employment of such individuals to be promptly transferred to a member of the Baudax Group. 

(c)    The Parties shall cooperate and take such actions as may be reasonably necessary in order to minimize potential
statutory, contractual, plan-based or other severance or similar obligations to the Parties or their Affiliates in connection with any transfers of employment described in this Section 2.1. 

(d)    Baudax will determine which, if any, temporary workers, individual consultants or independent contractors who are
performing service primarily related to the Acute Care Business, it wishes to transfer to Baudax and, the Parties shall use reasonable efforts to transfer the individual or to assign the applicable Contract to a member of the Baudax Group and Baudax
shall, or shall cause a member of the Baudax Group to, assume and perform such Contract. In the event that a transfer fee is required to be paid in order to effect such transfer, Baudax shall be responsible for and pay the full amount of such fee.

 (e)    In connection with the transfer of the Specified Employees, as of the Transfer Effective Time and subject to
the consent of such Specified Employee, the Specified Employee Employment Agreements shall be assigned by Recro to Baudax and all rights and obligations thereunder will be assumed by Baudax. In connection therewith, Recro and Baudax will use
reasonable efforts to cause each Specified Employees to deliver to Recro a release from all liabilities and obligations under the applicable Specified Employee Employment Agreement. 

Section 2.2.    Assumption and Retention of Liabilities. Recro and Baudax intend
that employment-related Liabilities associated with Recro Participants are to be retained or assumed by Recro or a Recro Group member, and employment-related Liabilities associated with Baudax Participants are to be assumed by Baudax or a Baudax
Group member, in each case, except as specifically set forth herein. Accordingly, as of the Transfer Effective Time: 

(a)    Recro or the applicable member of the Recro Group hereby retains or assumes and agrees to pay, perform, fulfill, and
discharge, except as expressly provided in this Agreement, (i) all Liabilities arising under or related to Recro Plans, (ii) all employment or service-related Liabilities with respect to (A) all Recro Participants and (B) any
individual who is, or was, an independent contractor, temporary employee, temporary service worker, consultant, freelancer, agency employee, leased employee, on-call worker, incidental worker, or non-payroll worker or in any other employment or similar relationship primarily connected to Recro or a Recro Group member and (iii) any Liabilities expressly transferred or allocated to Recro or a Recro Group
member under this Agreement (it being understood and agreed that the provisions of this Agreement do not create or constitute a source of any such Liability); and 

  
 -4- 

 (b)    Baudax hereby retains or assumes and agrees to pay, perform,
fulfill, and discharge, except as expressly provided in this Agreement, (i) all Liabilities arising under or related to Baudax Plans, (ii) all employment or service-related Liabilities with respect to (A) all Baudax Participants and
(B) any individual who is, or was, an independent contractor, temporary employee, temporary service worker, consultant, freelancer, agency employee, leased employee, on-call worker, incidental worker, or non-payroll worker or in any other employment or similar relationship primarily connected to Baudax or a Baudax Group member and (iii) any Liabilities expressly transferred or allocated to Baudax or a Baudax
Group member under this Agreement. 
 Section 2.3.    Plan Participation.
Except as otherwise expressly provided in this Agreement, effective as of immediately prior to the applicable Benefits Commencement Date, (a) (i) all Baudax Participants shall cease any participation in, and benefit accrual under, Recro Plans
and (ii) all members of the Baudax Group shall cease to be participating employers under the Recro Plans and, (b) to the extent applicable, (i) all Recro Participants shall cease any participation in, and benefit accrual under, Baudax
Plans and (ii) all members of the Recro Group shall cease to be participating employers under the Baudax Plans. Prior to the Transfer Effective Time, Recro and Baudax shall take all actions necessary to effectuate the actions contemplated by
this Section 2.3 and to cause (A) the applicable Baudax Group member to assume or retain all Liabilities with respect to each Baudax Plan and the applicable Recro Group member to assume or retain all Liabilities with
respect to each Recro Plan, in each case, effective as of the Transfer Effective Time and (B) all assets of any Baudax Plan to be transferred to or retained by the applicable Baudax Group member in the applicable jurisdiction and all assets of
any Recro Plan to be transferred to or retained by the applicable Recro Group member in the applicable jurisdiction, in each case, effective as of the Transfer Effective Time. 

Section 2.4.    No Duplication of Benefits; Service and Other Credit. Recro
and Baudax shall adopt, or cause to be adopted, all reasonable and necessary amendments and procedures to prevent Baudax Participants from receiving duplicative benefits from the Recro Plans and the Baudax Plans. With respect to Baudax Employees,
each Baudax Plan shall provide that for purposes of determining eligibility to participate, vesting, and entitlement to benefits, service prior to the Transfer Effective Time with Recro or a Recro Group member shall be treated as service with Baudax
or the applicable Baudax Group member. Such service also shall apply for purposes of satisfying any waiting periods, evidence of insurability requirements, or the application of any preexisting condition limitations under any Baudax Plan. Each
Baudax Plan shall, to the extent practicable, waive pre-existing condition limitations with respect to Baudax Employees. Baudax shall honor any deductible, co-payment
and out-of-pocket maximums incurred by the Baudax Employees and their eligible dependents under the Recro Plans in which they participated immediately prior to the
Benefits Commencement Date during the then-elapsed portion of the calendar year prior to the Benefits Commencement Date in satisfying any deductibles, co-payments or out-of-pocket maximums under the Baudax Plans in which they are eligible to participate after the Benefits Commencement Date in the same plan year in which such deductibles,
co-payments or out-of-pocket maximums were incurred. 

  
 -5- 

Section 2.5.    Reimbursements. From time to time after the Distribution
Effective Time, the Parties shall promptly reimburse one another, upon reasonable request of the Party requesting reimbursement and the presentation by such Party of such substantiating documentation as the other Party shall reasonably request, for
the cost of any Liabilities satisfied or assumed by the Party requesting reimbursement or its Affiliates that are made pursuant to this Agreement, the responsibility of the other Party or any of its Affiliates. 

ARTICLE III 

DEFINED CONTRIBUTION AND NON-QUALIFIED DEFERRED 

COMPENSATION PLANS 
 
Section 3.1.    401(k) Plan. 
 (a)    Each Baudax Participant who participates in
the Recro Defined Contribution Plan will cease active participation in the Recro Defined Contribution Plan as of immediately prior to the Transfer Effective Time. For the avoidance of doubt, all employee
pre-tax deferrals and employer contributions with respect to the Baudax Participants will be made to the Baudax 401(k) Plan on and following the effective date of the Baudax 401(k) Plan. 

(b)    In accordance with applicable Law, Recro and Baudax shall cause, in the manner described herein, the accounts under
the Recro Defined Contribution Plan of each Baudax Employee to be transferred to the Baudax 401(k) Plan, as soon as practicable after the effective date of the Baudax 401(k) Plan (which, for the avoidance of doubt, will be no earlier than the
Transfer Effective Time). On, or as soon as practicable after, the effective date of the Baudax 401(k) Plan: (i) Recro shall cause the accounts (including any outstanding loan balances and employer contributions described in
Section 3.1(c)) of each Baudax Employee in the Recro Defined Contribution Plan to be transferred from the trust established under the Recro Defined Contribution Plan to the trust established under the Baudax 401(k) Plan;
and (ii) Baudax shall cause such transferred accounts to be accepted by the Baudax 401(k) Plan and its related trust. 

(c)    If any Baudax Employees are eligible to receive true-up matching
contributions under the Recro Defined Contribution Plan with respect to the plan year in which the Transfer Effective Time occurs, and such contributions have not yet been deposited into the Baudax Employees’ accounts under the Recro Defined
Contribution Plan as of the date such accounts are transferred from the trust established under the Recro Defined Contribution Plan to the trust established under the Baudax 401(k) Plan as set forth in Section 3.1(b), then
Recro shall contribute the amount of such true-up matching contributions (and other employer contributions, if any) into the applicable Baudax Employees’ accounts under the Recro Defined Contribution Plan
prior to such transfer based on all service performed and compensation accrued through the Transfer Effective Time. 
 
ARTICLE IV 
 HEALTH AND WELFARE PLANS; PAYROLL; COBRA AND VACATION 

Section 4.1.    Cessation of Participation in Recro H&W
Plans. 
 (a)    Without limiting the generality of Section 2.3, effective as

  
 -6- 

 
of the Benefits Commencement Date, Baudax Participants shall cease to participate in the Recro H&W Plans; provided that any participation in, and benefit accrual under, Recro H&W Plans by
Baudax Participants during the period, if any, between the Distribution Effective Time and the Benefits Commencement Date (the “Benefits Transition Period”) shall be in accordance with, and pursuant to, the terms and conditions of
the Transition Services Agreement. 
 (b)    Effective as of the Benefits Commencement Date, Baudax shall cause Baudax
Participants who participate in a Recro H&W Plan immediately prior to the Benefits Commencement Date to be automatically enrolled or offered participation in a corresponding Baudax H&W Plan. 

(c)    To the extent applicable, Baudax shall cause Baudax H&W Plans to recognize and maintain all coverage and
contribution elections made by Baudax Participants under the corresponding Recro H&W Plans as of the Benefits Commencement Date and apply such elections under the applicable Baudax H&W Plan for the remainder of the period or periods for
which such elections are by their terms applicable. 
 (d)    Neither the transfer or other movement of employment or
service from any member of the Recro Group to any member of the Baudax Group at any time before the Benefits Commencement Date nor the Transfer Effective Time shall constitute or be treated as a “status change” under the Recro H&W
Plans or the Baudax H&W Plans. 
 (e)    Subject to the terms of the applicable Baudax H&W Plan and applicable
Law, Baudax shall use its reasonable best efforts to waive all limitations as to preexisting conditions, exclusions and waiting periods with respect to participation and coverage requirements applicable to Baudax Participants under any Baudax
H&W Plan in which such Baudax Participants may be eligible to participate on or after the applicable Benefits Commencement Date. 
 
Section 4.2.    Allocation of Health and Welfare Plan Liabilities. Effective as of the Transfer Effective Time, all Liabilities relating to, arising out of, or resulting from health and welfare coverage or claims
incurred prior to, on or after the Transfer Effective Time by each Baudax Participant under the Recro H&W Plans shall cease to be Liabilities of the Recro Group and shall be assumed by the Baudax Group and deemed to be Baudax Liabilities.
Without limiting the generality of the foregoing, any and all costs, expenses or Liabilities relating to participation by Baudax Participants in the Recro H&W Plans during the Benefits Transition Period shall be reimbursed by Baudax to the Recro
Group in accordance with the terms of the Transition Services Agreement. For the avoidance of doubt, (a) all Liabilities arising under (i) any Recro H&W Plan with respect to Baudax Participants or (ii) any Baudax H&W Plan and
(b) all Liabilities arising out of, relating to or resulting from the cessation of a Baudax Participant’s participation in any Recro H&W Plan and transfer to a Baudax H&W Plan as set forth herein (including any Actions or claims by
any Baudax Participants related thereto) shall, in each case, be Baudax Liabilities. 

Section 4.3.    Flexible Spending Plan Treatment. Effective as of the
Benefits Commencement Date, Baudax shall establish or designate flexible spending accounts for health and dependent care expenses (the “Baudax FSAs”). To the extent applicable, the Parties shall take all actions
reasonably necessary or appropriate so that the account balances (positive or negative) 

  
 -7- 

 
under the Recro FSAs of each Baudax Participant who has elected to participate therein in the year in which the Benefits Commencement Date occurs shall be transferred, effective as of the
Benefits Commencement Date, from the Recro FSAs to the corresponding Baudax FSAs. The Baudax FSAs shall assume responsibility as of the Benefits Commencement Date for all outstanding dependent care and health care claims under the Recro FSAs of each
Baudax Participant for the year in which the Benefits Commencement Date occurs and shall assume the rights of and agree to perform the obligations of the analogous Recro FSA from and after the Benefits Commencement Date. The Parties shall cooperate
in good faith to provide that the contribution elections of each such Baudax Participant as in effect immediately before the Benefits Commencement Date remain in effect under the Baudax FSAs from and after the Benefits Commencement Date. 

Section 4.4.    Workers’ Compensation Liabilities. All
workers’ compensation Liabilities relating to, arising out of, or resulting from any claim by Baudax Employees or Former Baudax Employees that result from an accident that occurs, or from an occupational disease which is incurred or becomes
manifest, as the case may be, on or before the Transfer Effective Time and while such individual was employed by Recro or a Recro Group member shall be assumed by Baudax as of the Transfer Effective Time; provided, however, that to the
extent that either (1) such a Liability is covered under a workers compensation insurance policy of Recro or a Recro Group member or (2) Recro has received an invoice for a covered expense prior to the Transfer Effective Time, Baudax shall
not assume such Liability. Notwithstanding the foregoing, Baudax shall assume worker’s compensation Liabilities to the extent they are imposed on Baudax under applicable Law or where the injury or illness related to the Liability is aggravated
or subject to further injury after the Transfer Effective Time. A Liability which must be paid due to the existence of a deductible shall not be deemed to be covered by a workers compensation insurance policy for purposes of this
Section 4.4. Subject to the foregoing, Baudax and each Baudax Group member shall also be solely responsible for all workers’ compensation Liabilities relating to, arising out of, or resulting from any claim incurred
for a compensable injury sustained by a Baudax Employee that results from an accident or from an occupational disease which is incurred or becomes manifest, as the case may be, after the Transfer Effective Time. Recro, each Recro Group member,
Baudax and each Baudax Group member shall cooperate with respect to processing of claims, any notification to appropriate governmental agencies of the disposition and the issuance of new, or the transfer of existing, workers’ compensation
insurance policies and claims handling contracts. 
 Section 4.5.    Payroll
Taxes and Reporting. Recro and Baudax (i) shall, to the extent practicable, treat Baudax (or a Baudax Group member designated by Baudax) as a “successor employer” and Recro (or the appropriate Recro Group member) as a
“predecessor,” within the meaning of Sections 3121(a)(l) and 3306(b)(l) of the Code, with respect to Baudax Employees for purposes of taxes imposed under the United States Federal Unemployment Tax Act or the United States Federal Insurance
Contributions Act (“FICA”), and (ii) hereby agree to use commercially reasonable efforts to implement the alternate procedure described in Section 5 of Revenue Procedure 2004-53.
Without limiting in any manner the obligations and Liabilities of the Parties under the Tax Matters Agreement, including all withholding obligations otherwise set forth therein, Recro, each Recro Group member, Baudax and each Baudax Group member
shall each bear its responsibility for payroll tax obligations and for the proper reporting to the appropriate governmental authorities of compensation earned by their respective employees after the Transfer Effective Time. 

  
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 Section 4.6.    COBRA and HIPAA
Compliance. The Recro Group shall administer the Recro Group’s compliance with the health care continuation coverage requirements of COBRA, the certificate of creditable coverage requirements of HIPAA and the corresponding provisions of the
Recro H&W Plans with respect to Baudax Participants who incur a COBRA “qualifying event” occurring on or before the applicable Benefits Commencement Date entitling them to benefits under a Recro H&W Plan; provided that, for the
avoidance of doubt, any Liabilities related thereto shall constitute Baudax Liabilities. Baudax shall be solely responsible for all Liabilities incurred pursuant to COBRA and for administering, at Baudax’s expense, compliance with the health
care continuation coverage requirements of COBRA, the certificate of creditable coverage requirements of HIPAA, and the corresponding provisions of the Baudax H&W Plans with respect to Baudax Participants who incur a COBRA “qualifying
event” that occurs at any time after the applicable Benefits Commencement Date entitling them to benefits under a Baudax Plan. The Parties agree that neither the Separation, the Distribution nor any assignment or transfer of the employment or
services of any employee or individual independent contractor as contemplated under this Agreement shall constitute a COBRA “qualifying event” for any purpose of COBRA. 

Section 4.7.    Vacation and Paid Time Off. As of the Transfer Effective
Time, the applicable Baudax Group member shall credit each Baudax Employee with the vacation and earned sick time that such individual has accrued immediately prior to the Transfer Effective Time in accordance with the vacation and personnel
policies applicable to such employee immediately prior to the Transfer Effective Time. 
 ARTICLE V

 INCENTIVE COMPENSATION, EQUITY COMPENSATION AND OTHER BENEFITS 

Section 5.1.    Annual Cash-Based Incentive Plans. As of the Transfer
Effective Time, Baudax shall assume the obligation, if any, to pay each Baudax Employee who is participating in a Recro annual cash incentive bonus program, including a sales incentive compensation plan, of Recro or a Recro Group member such Baudax
Employee’s incentive or sales bonus under such plan, based upon the amount accrued by Recro in respect of such obligations. Baudax shall cause such payments to be made to the applicable Baudax Employees at the time any corresponding payments
would be made under the corresponding Recro incentive bonus program. 

Section 5.2.    Treatment of Equity Incentives. Recro and, where applicable,
Baudax, shall take all necessary or appropriate actions so that each outstanding Recro RSU, Recro PRSU or Recro Option outstanding immediately prior to the Transfer Effective Time shall be treated as set forth in this
Section 5.2. 
 (a)    No Adjustments in Connection with Distribution. No adjustments
to the number of shares or exercise price, as applicable, shall be made to any Recro RSU, Recro PRSU or Recro Option in connection with the execution of this Agreement or the consummation of the transactions contemplated by the Separation Agreement.
Recro RSUs, Recro PRSUs and Recro Options that are outstanding and held by a Baudax Employee will remain outstanding and shall be subject to the same terms and conditions as of immediately prior to the Distribution Effective Time. 

  
 -9- 

 (b)    Withholding and Reporting. Recro shall be solely
responsible for all income, payroll and other tax remittance and reporting related to the compensation of Recro Participants in respect of Recro RSUs, Recro PRSUs, and Recro Options. The Parties will cooperate and communicate with each other and
with third-party providers to effectuate the withholding and remittance of any such taxes, as well as any required tax reporting, in a timely, efficient and appropriate manner. To the maximum extent permitted under applicable Law, Recro and Baudax
shall share, and shall cause each member of its respective Group to share, with each other and their respective agents and vendors all information reasonably necessary for the efficient and accurate administration of their payroll processes. 

ARTICLE VI 

GENERAL AND ADMINISTRATIVE 

Section 6.1.    Sharing of Participant Information. To the maximum extent
permitted under applicable Law, Recro and Baudax shall share, and shall cause each member of its respective Group to share, with each other and their respective agents and vendors all participant information reasonably necessary for the efficient
and accurate administration of each of the Recro Plans and the Baudax Plans. Recro and Baudax and their respective authorized agents shall, subject to applicable laws on confidentiality, be given reasonable and timely access to, and may make copies
of, all information relating to the subjects of this Agreement in the custody of the other Party, to the extent necessary for such administration. 

Section 6.2.    No Third Party Beneficiaries. No provision of this Agreement
or the Separation Agreement shall be construed to create any right, or accelerate entitlement, to any compensation or benefit whatsoever on the part of any future, present, or former employee of Recro, a Recro Group member, Baudax, or a Baudax Group
member under this Agreement, the Separation Agreement, any Recro Plan or Baudax Plan or otherwise. Except as expressly provided in this Agreement, nothing in this Agreement shall preclude Baudax or any Baudax Group member, at any time after the
Transfer Effective Time, from amending, merging, modifying, terminating, eliminating, reducing, or otherwise altering in any respect any Baudax Plan, any benefit under any Baudax Plan or any trust, insurance policy or funding vehicle related to any
Baudax Plan; and (iii) except as expressly provided in this Agreement, nothing in this Agreement shall preclude Recro or any Recro Group member, at any time after the Distribution Effective Time, from amending, merging, modifying, terminating,
eliminating, reducing, or otherwise altering in any respect any Recro Plan, any benefit under any Recro Plan or any trust, insurance policy or funding vehicle related to any Recro Plan. 

Section 6.3.    Audit Rights with Respect to Information Provided. Each of Recro
and Baudax, and their duly authorized representatives, shall have the right to conduct reasonable audits with respect to all information provided to it by the other Party pursuant to this Agreement. The Parties shall cooperate to determine the
procedures and guidelines for conducting audits under this Section 6.3, which shall require reasonable advance notice by the auditing Party. The auditing Party shall have the right to make copies of any records at its
expense, subject to applicable Law. Failure of a third party service provider to provide information shall not constitute a breach of this Section 6.3; provided, that the applicable Party has timely requested the
information from such service provider. 

  
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 Section 6.4.    Fiduciary
Matters. Recro and Baudax each acknowledge that actions required to be taken pursuant to this Agreement may be subject to fiduciary duties or standards of conduct under ERISA or other applicable Law, and no Party shall be deemed to be in
violation of this Agreement if it fails to comply with any provisions hereof based upon its good faith determination (as supported by advice from counsel experienced in such matters) that to do so would violate such a fiduciary duty or standard.
Each Party shall be responsible for taking such actions as are deemed necessary and appropriate to comply with its own fiduciary responsibilities and shall fully release and indemnify the other Party for any Liabilities caused by the failure to
satisfy any such responsibility. 
 Section 6.5.    Consent of Third
Parties. If any provision of this Agreement is dependent on the consent of any third party (such as a vendor or Governmental Authority), Recro and Baudax shall use commercially reasonable efforts to obtain such consent, and if such consent is
not obtained, to implement the applicable provisions of this Agreement to the full extent practicable. If any provision of this Agreement cannot be implemented due to the failure of such third party to consent, Recro and Baudax shall negotiate in
good faith to implement the provision in a mutually satisfactory manner. The phrase “commercially reasonable efforts” as used herein shall not be construed to require the incurrence of any
non-routine or unreasonable expense or liability or the waiver of any right. 
 
Section 6.6.    Proprietary Information and Inventions Agreements. Effective as of the Transfer Effective Time, Recro shall, or shall cause the appropriate member of the Recro Group to, waive such rights under any
proprietary information, confidentiality, inventions, restrictive covenant or similar agreement between any Baudax Employee and any Recro Group member as Recro determines in its discretion to be necessary or appropriate to permit such Baudax
Employee to perform his or her services to Baudax or a Baudax Group member from and after the Transfer Effective Time. 
 
ARTICLE VII 
 MISCELLANEOUS 

Section 7.1.    General. The provisions of Article X of the Separation
Agreement, are hereby incorporated by reference into and deemed part of this Agreement and shall apply, mutatis mutandis, as if fully set forth in this Agreement. 

[The remainder of this page is intentionally left blank.] 

  
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 IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the day
and year first above written. 
  

			
	RECRO PHARMA, INC.
		
	By:	 	  

		 	Name:
		 	Title:
	
	BAUDAX BIO, INC.
		
	By:	 	  

		 	Name:
		 	Title:

 [Signature page to Employee Matters Agreement] 

 EXHIBIT A 

Specified Employees and Specified Employee Employment Agreements 

[Signature page to Employee Matters Agreement]

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