Document:

Form of Employee Matters Agreement

 Exhibit 10.3 
 EMPLOYEE MATTERS AGREEMENT 
 by and between 

PHARMACEUTICAL PRODUCT DEVELOPMENT, INC. 
 and 
 FURIEX PHARMACEUTICALS, INC. 
 Dated as of                     , 2010

 EMPLOYEE MATTERS AGREEMENT 
 EMPLOYEE MATTERS AGREEMENT (this “Agreement”), dated as of
                        , 2010, by and between Pharmaceutical Product Development, Inc., a North Carolina corporation
(“PPD”), and Furiex Pharmaceuticals, Inc., a Delaware corporation (“Furiex”). Each of PPD and Furiex is herein referred to as a “Party” and collectively, as the “Parties”. 
 RECITALS: 
 WHEREAS, PPD, acting through its direct and indirect Subsidiaries, currently conducts a number of businesses, including (i) the PPD Business and (ii) the Furiex Business; 
 WHEREAS, the Board of Directors of PPD has determined that it is appropriate, desirable and in the best interests of PPD and its
shareholders to separate PPD into two independent companies (the “Separation”), one for each of: (i) the PPD Business, which shall continue to be owned and conducted, directly or indirectly, by PPD, and (ii) the Furiex Business,
which shall be owned and conducted, directly or indirectly, by Furiex; 
 WHEREAS, to effect the Separation, the Parties entered
into a Separation and Distribution Agreement dated as of even date hereof (as amended or otherwise modified from time to time, the “Separation Agreement”); and 
 WHEREAS, pursuant to the Separation Agreement, PPD and Furiex have agreed to enter into this Agreement for the purpose of allocating assets, liabilities and responsibilities with respect to certain
employee compensation and benefit plans and programs between them. 
 NOW, THEREFORE, in consideration of the foregoing
premises, the mutual promises and covenants hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows: 
 ARTICLE I 
 DEFINITIONS AND INTERPRETATION 
 Section 1.1 Definitions. The following terms shall have the
following meanings: 
 “Affiliate” shall mean the definition as set forth in the Separation Agreement.

 “Benefit Plan” shall mean, with respect to an entity, each plan, program, arrangement, agreement or
commitment that is an employment, change in control/severance, consulting, non-competition or deferred compensation agreement, or an executive compensation, incentive bonus or other bonus, employee pension, profit-sharing, savings, retirement,
supplemental retirement, stock option, stock purchase, stock appreciation rights, restricted stock, other equity-based compensation, severance pay, salary continuation, life, health, hospitalization, sick leave, vacation pay, disability or accident
insurance plan, corporate-owned or key-man life insurance or other employee benefit plan, program, arrangement, agreement or commitment, including any “employee benefit plan” (as defined in Section 3(3) of ERISA), sponsored or
maintained by such entity (or to which such entity contributes or is required to contribute). 

 “COBRA” shall mean 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 Section 4980B of the Code and Sections 601 through 608 of ERISA, together with all regulations and proposed
regulations promulgated thereunder. 
 “Code” shall mean the Internal Revenue Code of 1986, as amended,
including any successor statute, regulation and guidance thereto. 
 “Distribution” shall mean the definition
as set forth in the Separation Agreement. 
 “Distribution Date” shall mean the definition as set forth in the
Separation Agreement. 
 “Effective Time” shall mean the definition as set forth in the Separation Agreement.

 “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended. 
 “ERISA Affiliate” shall mean with respect to any Person, each business or entity which is a member of a “controlled
group of corporations,” under “common control” or a member of an “affiliated service group” with such Person within the meaning of Sections 414(b), (c) or (m) of the Code, or required to be aggregated with such
Person under Section 414(o) of the Code, or under “common control” with such Person within the meaning of Section 4001(a)(14) of ERISA. 
 “Exchange Act” shall mean the definition as set forth in the Separation Agreement. 
 “Former Furiex Employee” shall mean the definition as set forth in the Separation Agreement. 
 “Former Furiex Employee” shall mean the definition as set forth in the Separation Agreement. 
 “Governmental Authority” shall mean the definition as set forth in the Separation Agreement. 
 “HIPAA” shall mean the Health Insurance Portability and Accountability Act of 1996, as amended. 
 “Initial Furiex Stock Price” shall mean the closing per share trading price of Furiex Common Stock on the day after the Distribution Date, unless otherwise determined by the PPD Board of
Directors or its Compensation Committee in its sole discretion in order to effect an equitable adjustment of a PPD Option in connection with the Distribution and ensure that such PPD Option is not deemed to have undergone a modification under
Section 409A of the Code. 
 “Liabilities” shall mean the definition as set forth in the Separation
Agreement. 
 “Furiex 401(k) Plan” shall mean the definition as set forth in Section 3 of this Agreement.

 “Furiex Benefit Plan” shall mean any Benefit Plan sponsored, maintained or contributed to by any member of
the Furiex Group or any ERISA Affiliate thereof immediately following the Effective Time, including the Furiex 401(k) Plan and the Furiex Welfare Plans. 
 “Furiex Business” shall mean all of the business and operations of the compound partnering segments of PPD as described in the Form 10. 
 “Furiex Common Stock” shall mean the common stock, par value $.001 per share, of Furiex. 
 “Furiex Employee” shall mean a person listed on Exhibit A to the Separation Agreement. 
 “Furiex Group” shall mean the definition as set forth in the Separation Agreement. 
 “Furiex Liabilities” shall mean the definition as set forth in the Separation Agreement. 
  

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 “Furiex Participant” shall mean any individual who, immediately following
the Effective Time, is an Furiex Employee, a Former Furiex Employee or a beneficiary, dependent or alternate payee of any of the foregoing. 
 “Furiex Welfare Plans” shall mean health and welfare plans maintained by a member of the Furiex Group. 
 “Participating Company” shall mean PPD or any Person (other than an individual) participating in a PPD Benefit Plan. 
 “Person” shall mean any natural person, firm, individual, corporation, business trust, joint venture, association, company,
limited liability company, partnership, or other organization or entity, whether incorporated or unincorporated, or any governmental entity. 
 “Post-Distribution PPD Option” shall mean the definition set forth in Section 5.1(a) of this Agreement. 
 “Post-Distribution PPD Stock Price” shall mean the closing per share trading price of PPD Common Stock on an ex-distribution basis on the day after the Distribution Date, unless otherwise
determined by the PPD Board of Directors or its Compensation Committee in its sole discretion in order to effect an equitable adjustment of a PPD Option in connection with the Distribution and ensure that such PPD Option is not deemed to have
undergone a modification under Section 409A of the Code. 
 “PPD 401(k) Plan” shall mean the definition as
set forth in Section 2.1(a) of this Agreement. 
 “PPD Benefit Plan” shall mean any Benefit Plan
sponsored, maintained or contributed to by any member of the PPD Group or any ERISA Affiliate thereof other than Furiex or any member of the Furiex Group. 
 “PPD Business” shall mean the definition as set forth in the Separation Agreement. 
 “PPD Common Stock” shall mean the definition as set forth in the Separation Agreement. 
 “PPD Employee” shall mean the definition as set forth in the Separation Agreement. 
 “PPD Group” shall mean the definition as set forth in the Separation Agreement. 
 “PPD Liabilities” shall mean the definition as set forth in the Separation Agreement. 
 “PPD Option” shall mean an option to purchase shares of PPD Common Stock granted pursuant to the PPD Stock Plan. 
 “PPD Participant” shall mean any individual who, immediately following the Effective Time, is a PPD Employee, a Former PPD
Employee or a beneficiary, dependent or alternate payee of any of the foregoing. 
 “PPD Stock Plan” shall mean
the Pharmaceutical Product Development, Inc. Equity Compensation Plan, as amended. 
 “PPD Welfare Plans” shall
mean, collectively, the health and welfare benefit plans maintained by a member of the PPD Group. 
 “Pre-Distribution
PPD Stock Price” shall mean the closing per share trading price of PPD Common Stock on an ex-distribution basis on the Distribution Date. 
 “Pre-Distribution PPD Option Price” shall mean the definition set forth in Section 5.1(a)(i) of this Agreement. 
 “Subsidiary” shall mean the definition as set forth in the Separation Agreement. 
 “Third Party” shall mean the definition as set forth in the Separation Agreement. 
 Section 1.2 References; Interpretation. References in this Agreement to any gender include references to all genders, and
references to the singular include references to the plural and vice versa. Unless the context otherwise requires, the words “include”, “includes” and “including” when used in this Agreement shall be deemed to be

  

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followed by the phrase “without limitation”. Unless the context otherwise requires, references in this Agreement to Articles, Sections, Exhibits and Schedules shall be deemed references
to Articles and Sections of, and Exhibits and Schedules to, this Agreement. Unless the context otherwise requires, the words “hereof”, “hereby”, “herein” and “herewith” and words of similar import when used in
this Agreement refer to this Agreement in its entirety and not to any particular Article, Section or provision of this Agreement. The word “or” shall not be exclusive. 
 ARTICLE II 
 GENERAL PRINCIPLES 
 Section 2.1 Assumption and Retention of Liabilities; Related Assets. 
 (a) As of the date hereof and with effect at the Effective Time, except as otherwise expressly provided in this Agreement, PPD shall, or
shall cause one or more members of the PPD Group to, assume or retain, as applicable, and pay, perform, fulfill and discharge, in due course in full (i) all Liabilities under all PPD Benefit Plans (except that PPD shall have no liability with
respect to any assets of the PPD Retirement Savings Plan (the “PPD 401(k) Plan”) to the extent, and as of the date, that such assets are transferred to the Furiex 401(k) Plan pursuant to Section 3.1), (ii) all Liabilities
(excluding Liabilities incurred under a Benefit Plan except as otherwise provided in this Agreement) with respect to the employment, service, termination of employment or termination of service of all PPD Employees, Former PPD Employees and their
dependents and beneficiaries (and any alternate payees in respect thereof) and other service providers (including 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, non-employment, or retainer arrangement, or relationship with any member of the PPD Group), in each case to the extent arising in
connection with or as a result of employment with or the performance of services for any member of the PPD Group, and (iii) any other Liabilities or obligations expressly assigned to PPD or any of its Affiliates (other than any member of the
Furiex Group) under this Agreement. For purposes of clarification, the Liabilities assumed or retained by the PPD Group as provided for in this Section 2.1(a) or elsewhere in this Agreement are intended to be PPD Liabilities. 
 (b) As of the date hereof and with effect at the Effective Time, except as otherwise expressly provided in this Agreement, Furiex shall, or
shall cause one or more members of the Furiex Group to, assume or retain, as applicable, and pay, perform, fulfill and discharge, in due course in full (i) all Liabilities under all Furiex Benefit Plans, (ii) all Liabilities (excluding
Liabilities incurred under a Benefit Plan except as otherwise provided in this Agreement) with respect to the employment, service, termination of employment or termination of service of all Furiex Employees, Former Furiex Employees and their
dependents and beneficiaries (and any alternate payees in respect thereof) and other service providers (including 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, non-employment, or retainer arrangement, or relationship with any member of the PPD Group or Furiex Group), in each case to the extent
arising in connection with or as a result of employment with or the performance of services for any member of the Furiex Group, or in the case of Former Furiex Employees, the PPD Group, and (iii) any other Liabilities or obligations expressly
assigned to Furiex or any of its Affiliates (other than any member of the PPD Group), under this Agreement. For purposes of clarification, the Liabilities assumed or retained by the Furiex Group as provided for in this Section 2.1(b) or
elsewhere in this Agreement are intended to be Furiex Liabilities as such term is defined in the Separation Agreement. 
 (c)
From time to time after the Distribution Date, the Parties shall promptly reimburse one another, upon written 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 reasonable cost of any obligations or Liabilities satisfied or assumed by the Party requesting reimbursement or its Affiliates that are, or that have been made pursuant to this Agreement, the responsibility of the
other Party or any of its Affiliates. Any such request for reimbursement must be made not later than the first anniversary of the Distribution Date. 
 (d) PPD shall retain responsibility for all employee-related regulatory filings for reporting periods through the Distribution Date except for Equal Employment Opportunity Commission EEO-1 reports and
affirmative action program (AAP) reports and responses to Office of Federal Contract Compliance Programs (OFCCP) submissions or other Governmental Authority inquiries, for which PPD will provide data and information (to the extent permitted by
applicable Laws and consistent with Section 8.1) to Furiex, who will be responsible for making such filings in respect of Furiex Employees. 
  

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 Section 2.2 Participation in PPD Benefit Plans. Except as otherwise expressly
provided for in this Agreement or as otherwise expressly agreed to in writing between or among the affected Parties, (i) effective as of the Effective Time, Furiex and each member of the Furiex Group shall cease to be a Participating Company in
any PPD Benefit Plan, and (ii) each Furiex Participant and any other service providers (including 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 nonpayroll worker of any member of the Furiex Group or in any other employment, non-employment, or retainer arrangement, or relationship with any member of the Furiex Group), effective as of the
Effective Time, shall cease to participate in, be covered by, accrue benefits under, be eligible to contribute to or have any rights under any PPD Benefit Plan (except to the extent of obligations that accrued on or before the Effective Time,
including benefits that are not otherwise addressed herein), and Furiex and PPD shall take all necessary action to effectuate each such cessation. 
 Section 2.3 Service Recognition. Furiex shall give each Furiex Participant full credit for purposes of eligibility, vesting, determination of level of benefits, and, to the extent applicable,
benefit accruals under any Furiex Benefit Plan, respectively, for such Furiex Participant’s service with any member of the PPD Group through the Distribution Date to the same extent such service was recognized by the applicable PPD Benefit
Plans as of the Distribution Date; provided, that, such service shall not be recognized to the extent that such recognition would result in the duplication of benefits. 
 ARTICLE III 
 QUALIFIED DEFINED CONTRIBUTION PLAN 
 Section 3.1 Furiex 401(k) Plan. 
 (a) Establishment of the Furiex 401(k) Plan. Effective as of the Distribution Date, Furiex shall, or shall have caused one of its Affiliates to, establish a defined contribution plan
and trust for the benefit of Furiex Participants (the “Furiex 401(k) Plan”). Furiex shall be responsible for taking all necessary, reasonable and appropriate action to establish, maintain and administer the Furiex 401(k) Plan so that it is
qualified under Section 401(a) of the Code and that the related trust thereunder is exempt from Federal income tax under Section 501(a) of the Code. Furiex (acting directly or through its Affiliates) shall be responsible for any and all
Liabilities and other obligations with respect to the Furiex 401(k) Plan. 
 (b) Transfer of Savings Plan Assets. Not
later than ninety (90) days following the Distribution Date (or such later time as mutually agreed by PPD and Furiex), PPD shall cause the accounts (including any outstanding loan balances) in the PPD 401(k) Plan attributable to Furiex
Participants and all of the assets in the PPD 401(k) Plan related thereto, to be transferred to the Furiex 401(k) Plan and Furiex shall cause the Furiex 401(k) Plan to accept such transfer of accounts and underlying assets and, effective as of the
date of such transfer, to assume and to fully perform, pay and discharge, all obligations of the PPD 401(k) Plan relating to the accounts of Furiex Participants (to the extent the assets related to those accounts are actually transferred from the
PPD 401(k) Plan to the Furiex 401(k) Plan). Any transfer of assets pursuant to this Section 3.1(b) shall be conducted in accordance with Section 414(l) of the Code, Treasury Regulation Section 1.414(1)-1, and Section 208 of
ERISA. 
 (c) Form 5310-A. No later than thirty (30) days prior to the date of any transfer of assets and
liabilities pursuant to Section 3.1(b), PPD and Furiex (each acting directly or through their respective Affiliates) shall, to the extent necessary, file Internal Revenue Service Form 5310-A regarding the transfer of assets and liabilities from
the PPD 401(k) Plan to the Furiex 401(k) Plan as described in this Section 3.1. 
 (d) Contributions as of the
Distribution Date. All contributions payable to the PPD 401(k) Plan with respect to employee deferrals and contributions, matching contributions and other contributions for Furiex Participants through the Distribution Date, determined in
accordance with the terms and provisions of the PPD 401(k) Plan, ERISA and the Code, shall be paid by PPD to the PPD 401(k) Plan prior to the date of the asset transfer described in subsection (b), above. 
  

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 ARTICLE IV 
 HEALTH AND WELFARE PLANS 
 Section 4.1 Health
and Welfare Plans Maintained By PPD through the Distribution Date. 
 (a) Establishment of Welfare Plans. PPD or one
or more of its Affiliates maintain the PPD Welfare Plans for the benefit of eligible PPD Participants and Furiex Participants. Effective as of the day following the Distribution Date, Furiex shall, or shall cause a Furiex Affiliate to, adopt, for
the benefit of eligible Furiex Participants, Furiex Welfare Plans on terms and conditions determined by Furiex. 
 (b)
Employees on Leave. Notwithstanding any other provision of this Agreement to the contrary, Furiex shall assume Liability for payment of any salary continuation, short term disability or health and welfare coverage with respect to Furiex
Employees and PPD shall have no further responsibility for such disabled Furiex Employees or Furiex Employees on approved leave after the Distribution Date. 
 (c) COBRA and HIPAA. Effective as of the Effective Time, PPD shall retain responsibility for compliance with the health care continuation coverage requirements of COBRA with respect to Furiex
Participants who, as of the Distribution Date, were covered under a PPD Welfare Plan and had a qualifying event within the meaning of Code § 4980B(f)(3) before the Effective Time. PPD (acting directly or through its Affiliates) shall be
responsible for administering compliance with any certificate of creditable coverage requirements of HIPAA or Medicare applicable to the PPD Welfare Plans with respect to Furiex Participants. 
 (d) Liabilities. 
 (i) Insured Benefits. With respect to employee welfare and fringe benefits that are provided through the purchase of insurance (including, without limitation, health, disability and workers’ compensation benefits), PPD shall
timely pay all premiums in respect of coverage of Furiex Participants in respect of the period through the Distribution Date and shall retain all claims incurred by the Furiex Participants through the Distribution Date, and Furiex shall cause PPD
not to have any liability in respect of any and all claims of Furiex Participants that are incurred under the Furiex Welfare Plans. 
 (ii) Incurred Claim Definition. For purposes of this Section 4.1(e), a claim or Liability is deemed to be incurred (A) with respect to medical, dental, vision and/or prescription drug benefits, upon the rendering of health
services giving rise to such claim or Liability; (B) with respect to life insurance, accidental death and dismemberment and business travel accident insurance, upon the occurrence of the event giving rise to such claim or Liability; and
(C) with respect to disability benefits, upon the date of an individual’s disability, as determined by the disability benefit insurance carrier or claim administrator, giving rise to such claim or Liability. 
 Section 4.2 Time-Off Benefits. Furiex shall credit each Furiex Participant with the amount of accrued but unused paid time-off
benefits as such Furiex Participant had with the PPD Group as of the Distribution Date. 
 ARTICLE V 
 STOCK OPTIONS 
 Section 5.1 Treatment of Outstanding PPD Options. 
 (a) Each PPD Option that is outstanding on the
Distribution Date shall, as of the Distribution Date, be adjusted in the following manner (as adjusted, a “Post-Distribution PPD Option”): 
 (i) The number of shares subject to the Post-Distribution PPD Option shall be equal to the number of shares subject to the PPD Option immediately prior to the Distribution Date. The per share exercise
price of the Post-Distribution PPD Option shall be equal to the product of (1) the Pre-Distribution PPD Option Price multiplied by (2) a fraction, the numerator of which shall be the Post-Distribution PPD

  

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Stock Price and the denominator of which shall be the Pre-Distribution PPD Stock Price. Following the adjustment to the per share exercise price of the Post-Distribution PPD Option, the number of
shares subject to the Post-Distribution PPD Option shall be adjusted, if necessary, to ensure that the intrinsic value of each Post-Distribution PPD Option is the same on the day immediately after the Distribution Date as it is on the Distribution
Date. With respect to each Post-Distribution PPD Option, the aggregate spread of such option shall not exceed the aggregate spread of the relevant PPD Option on which it was based, and the ratio of the exercise price to the fair market value of the
shares subject to the Post-Distribution PPD Option, immediately after the adjustment shall not be greater than the ratio of the exercise price to the fair market value of the shares subject to the relevant PPD Option immediately before the
adjustment and all other requirements of Section 409A shall be met in order to ensure that no modification is deemed to occur under Section 409A with respect to any Post-Distribution PPD Option. 
 (ii) Each unvested PPD Option held by a Furiex Employee immediately before the Distribution Date shall automatically
terminate as of the Distribution Date. 
 (iii) Each vested PPD Option held by a Furiex Employee immediately
after the Distribution Date shall thereafter be a Post-Distribution PPD Option. Any Post-Distribution PPD Option held by a Furiex Employee must be exercised prior to the earlier of (A) the termination of the Furiex Employee’s employment
with Furiex for any reason (provided that the Furiex Employee will be allowed to exercise during any post-termination period provided by the relevant PPD Option on which the Post-Distribution PPD Option was based) or (B) the expiration date of
the relevant PPD Option on which the Post-Distribution PPD Option was based. 
 (iv) Prior to the Distribution
Date, PPD shall take all actions necessary to provide that, effective as of the Distribution Date, for purposes of the Post-Distribution PPD Options (including in determining exercisability and the post-termination exercise period), a Furiex
Employee’s continuous service with the Furiex Group (including applicable successors) following the Distribution Date shall be deemed continuous service with PPD. 
 (v) Upon the exercise of a Post-Distribution PPD Option, regardless of the holder thereof, the exercise price shall be paid
to (or otherwise satisfied to the satisfaction of) PPD in accordance with the terms of the Post-Distribution PPD Option, and PPD shall be solely responsible for the issuance of PPD Common Stock, for ensuring the collection of the employee portion of
all applicable withholding tax on behalf of the employing entity of such holder and for ensuring the remittance of such withholding taxes to the employing entity of such holder. 
 (b) Except as otherwise provided herein, the Post-Distribution PPD Options shall remain subject to the terms and conditions of the
underlying PPD Options as in effect immediately prior to the Distribution Date (taking into account changes in the identity of the employer, including for purposes of determining whether a change in control has occurred). 
 Section 5.2 Cooperation and Special Award Terms. PPD shall establish an appropriate administration system in order to handle, in
an orderly manner, exercises of Post-Distribution PPD Options. Each of the Parties will work together to unify and consolidate all indicative data and payroll and employment information on regular timetables and make certain that each applicable
entity’s data and records in respect of such awards are correct and updated on a timely basis. The foregoing shall include employment status and information required for tax withholding/remittance, compliance with trading windows and compliance
with the requirements of the Exchange Act and other applicable Laws. Each of the Parties shall honor the terms of any written agreement entered into on or before the Distribution Date with any employee of another Party insofar as such written
agreement provides for accelerated vesting or the extension of the term of any PPD Options. 
 Section 5.3 SEC
Registration. The Parties mutually agree to use reasonable best efforts to maintain effective registration statements with the SEC with respect to the Post-Distribution PPD Options. 
  

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 ARTICLE VI 
 ADDITIONAL COMPENSATION MATTERS 
 Section 6.1
Workers’ Compensation Liabilities. Except as provided in Section 4.1(e)(i), all workers’ compensation Liabilities relating to, arising out of, or resulting from any claim that results from an accident, incident or event
occurring, or from an occupational disease which becomes manifest, at, before or after the Distribution Date by (i) any PPD Employee or Former PPD Employee shall be retained by PPD, and (ii) by any Furiex Employee or Former Furiex Employee
shall be assumed by Furiex. 
 Section 6.2 Director Programs; Director Fees. PPD shall retain responsibility for the
payment of any fees payable in respect of service on the PPD Board of Directors that are payable but not yet paid as of the Distribution Date, and Furiex shall not have any responsibility for any such payments. After the Distribution Date, PPD and
Furiex will each be responsible for the fees and expenses of their respective Boards of Directors. 
 Section 6.3
Certain Payroll Matters. In the case of an individual who transfers employment on the Distribution Date from PPD to Furiex, Furiex shall be responsible for paying the entire payroll amount due to such individual for the first payroll cycle
ending after the Distribution Date and for satisfying all applicable tax reporting and withholding requirements in respect of such payment; provided, that, PPD shall reimburse Furiex for the gross amount of the payroll payment (i.e., including any
applicable deductions) and for all tax withholdings remitted in respect of such portion of the payroll period ending on the Distribution Date. PPD shall be entitled to the benefit of any tax deduction in respect of its payment (by reimbursement to
Furiex) for the portion of the payroll period ending on the Distribution Date. 
 ARTICLE VII 
 INDEMNIFICATION 
 Section 7.1 Indemnification by Furiex. Furiex hereby agrees to indemnify, defend and hold harmless PPD from and against any and all claims, losses, demands, liabilities, costs and expenses (including reasonable attorneys’
fees and costs and expenses related thereto) suffered or incurred by PPD as a result of, or in connection with, a breach of this Agreement by Furiex. 
 Section 7.2 Indemnification by PPD. PPD hereby agrees to indemnify, defend and hold harmless Furiex from and against any and all claims, losses, demands, liabilities, costs and expenses
(including reasonable attorney’s fees and costs and expenses related thereto) suffered or incurred by Furiex as a result of, or in connection with, a breach of this Agreement by PPD. 
 Section 7.3 Procedures. Any claim for indemnification under this Section 7 shall be governed by, and be subject to, the
provisions of Article V of the Separation Agreement, which provisions are hereby incorporated by reference into this Agreement and any references to “Agreement” in such Article V as incorporated herein shall be deemed to be references to
this Agreement. 
 ARTICLE VIII 
 GENERAL AND ADMINISTRATIVE 
 Section 8.1 Sharing Of
Information. PPD and Furiex (acting directly or through their respective Affiliates) shall provide to each other and their respective agents and vendors all information as the other may reasonably request to enable the requesting Party to
administer efficiently and accurately each of its Benefit Plans, to timely and accurately comply with and report under Section 14 of the Exchange Act and to determine the scope of, as well as fulfill, its obligations under this Agreement. Such
information shall, to the extent reasonably practicable, be provided in the format and at the times and places requested, but in no event shall the Party providing such information be obligated to incur any out-of-pocket expenses not reimbursed by
the Party making such request or make such information available outside of its normal business hours and premises. Any information shared or

  

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exchanged pursuant to this Agreement shall be subject to the confidentiality requirements set forth in the Separation Agreement. The Parties also hereby agree to enter into any business associate
agreements that may be required for the sharing of any information pursuant to this Agreement to comply with the requirements of HIPAA. 
 Section 8.2 Reasonable Efforts/Cooperation. Each of the Parties hereto will use its reasonable best efforts to promptly take, or cause to be taken, all actions and to do, or cause to be done,
all things necessary, proper or advisable under applicable Laws and regulations to consummate the transactions contemplated by this Agreement, including adopting plans or plan amendments. Each of the Parties hereto shall cooperate fully on any issue
relating to the transactions contemplated by this Agreement for which the other Party seeks a determination letter or private letter ruling from the Internal Revenue Service, an advisory opinion from the Department of Labor or any other filing,
consent or governmental approval. 
 Section 8.3 Employer Rights. Nothing in this Agreement shall prohibit any Party
or any of their respective Affiliates from amending, modifying or terminating any of their respective Benefit Plans at any time within their sole discretion. 
 Section 8.4 Effect on Employment. Except as expressly provided in this Agreement, the occurrence of the Distribution alone shall not cause any employee to be deemed to have incurred a
termination of employment, which entitles such individual to the commencement of benefits under any of the PPD Benefit Plans. Furthermore, nothing in this Agreement is intended to confer upon any employee or former employee of PPD, Furiex or any of
their respective Affiliates any right to continued employment, or any recall or similar rights to an individual on layoff or any type of approved leave. 
 Section 8.5 Consent of Third Parties. If any provision of this Agreement is dependent on the consent of any Third Party and such consent is withheld, the Parties hereto shall use their
reasonable best efforts to implement the applicable provisions of this Agreement to the fullest extent practicable. If any provision of this Agreement cannot be implemented due to the failure of such Third Party to consent, the Parties hereto shall
negotiate in good faith to implement the provision (as applicable) in a mutually satisfactory manner. 
 Section 8.6
Access to Employees. Following the Distribution Date, PPD and Furiex shall, or shall cause each of their respective Affiliates to, make available to each other those of their employees who may reasonably be needed in order to defend or
prosecute any legal or administrative action (other than a legal action between or among any of the Parties) to which any employee, director or Benefit Plan of the PPD Group or Furiex Group is a party and which relates to their respective Benefit
Plans prior to the Distribution. The Party to whom an employee is made available in accordance with this Section 8.6 shall pay or reimburse the other Party for all reasonable expenses which may be incurred by such employee in connection
therewith, including all reasonable travel, lodging, and meal expenses, but excluding any amount for such employee’s time spent in connection herewith. Any such reimbursement by one Party to the other shall be made within 90 days of the date on
which the Party seeking reimbursement provides the reimbursing Party with documentation of such expenses that is reasonably acceptable to the reimbursing Party. 
 Section 8.7 Beneficiary Designation/Release of Information/Right to Reimbursement. To the extent permitted by applicable law, including, without limitation, the privacy and security
requirements of HIPAA, and except as otherwise provided for in this Agreement, all beneficiary designations, authorizations for the release of information and rights to reimbursement made by or relating to Furiex Participants under PPD Benefit Plans
shall be transferred to and be in full force and effect under the corresponding Furiex Benefit Plans and PPD Benefit Plans until such beneficiary designations, authorizations or rights are replaced or revoked by, or no longer apply, to the relevant
Furiex Participant. 
 ARTICLE IX 
 MISCELLANEOUS 
 Section 9.1 Effect If Certain Events Do Not
Occur. Notwithstanding anything in this Agreement to the contrary, if the Separation Agreement is terminated prior to the Effective Time, then all actions and events that are, under this Agreement, to be taken or occur effective prior to, as of
or following the Distribution Date, or otherwise in connection with the Separation, shall not be taken or occur except to the extent specifically agreed to in writing by PPD on the one hand and Furiex on the other hand and no Party shall have any
Liability or further obligation to any other Party under this Agreement. 
  

 9 

 Section 9.2 Relationship of Parties. Nothing in this Agreement shall be deemed
or construed by the Parties or any Third Party as creating the relationship of principal and agent, partnership or joint venture between or among the Parties, it being understood and agreed that no provision contained herein, and no act of the
Parties, shall be deemed to create any relationship between or among the Parties other than the relationship set forth herein. 
 Section 9.3 Subsidiaries. Each of the Parties shall cause to be performed all actions, agreements and obligations set forth herein to be performed by any Subsidiary or Affiliate of such Party or by any entity that becomes a
Subsidiary or Affiliate of such Party on and after the Distribution Date. The Parties acknowledge that certain actions, agreements and obligations that certain of their Affiliates and Subsidiaries may be required to perform in connection with the
performance of the Parties obligations under this Agreement may require governmental approval under applicable law, and therefore agree that performance of such actions, agreements and obligations is subject to the receipt of all such necessary
governmental approvals, which governmental approvals each Party shall, and shall cause the members of its respective Group to, use its reasonable best efforts to obtain. 
 Section 9.4 Notices. All notices, requests, claims, demands and other communications under this Agreement shall be in writing and shall be deemed to be duly given when (a) delivered in
person or (b) deposited in the United States mail or private express mail, postage prepaid, addressed as follows: 
 To PPD: 
 Pharmaceutical Product Development, Inc. 
 929
North Front Street 
 Wilmington, North Carolina 28401 
 Attn: Chief Executive Officer 
 Facsimile: 910-762-5820 
 With copy to General Counsel 
 To Furiex:

 Furiex Pharmaceuticals, Inc. 
 3900
Paramount Parkway, Suite 150 
 Morrisville, North Carolina 27560 
 Attn: Principal Executive Officer 
 Facsimile:
919-                             
 Either Party may, by notice to the other Party, change the address to which such notices are to be given. 
 Section 9.5 Entire Agreement. This Agreement, the Separation Agreement, and all other agreements, instruments, understandings,
assignments or other arrangements entered into between the Parties in connection with the Separation, including the exhibits and schedules thereto, contain the entire agreement between the Parties with respect to the subject matter hereof and shall
supersede all previous agreements, negotiations, discussions, writings, understandings, commitments and conversations with respect to such subject matter and there are no agreements or understandings between the Parties other than those set forth or
referred to herein or therein. In the event of any conflict between the terms and conditions of this Agreement and the terms and conditions of the Separation Agreement, the terms and conditions of this Agreement (including amendments thereto) shall
control. 
 Section 9.6 Waivers. The failure of any Party to require strict performance by the other Party of any
provision in this Agreement will not waive or diminish that Party’s right to demand strict performance thereafter of that or any other provision hereof. 
 Section 9.7 Governing Law. This Agreement shall be governed by and construed and interpreted in accordance with the laws of the State of North Carolina, irrespective of the choice of laws
principles of the State of North Carolina as to all matters, including matters of validity, construction, effect, enforceability, performance and remedies. 
  

 10 

 Section 9.8 Counterparts. This Agreement may be executed in more than one
counterparts, each of which shall be considered one and the same agreement, and shall become effective when each counterpart has been signed by each of the Parties and delivered to the other Parties. Execution of this Agreement or any other
documents pursuant to this Agreement by facsimile or other electronic copy of a signature shall be deemed to be, and shall have the same effect as, executed by an original signature. 
 Section 9.9 Severability. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid,
void or unenforceable, the remaining provisions hereof, or the application of such provision to Persons or circumstances or in jurisdictions other than those as to which it has been held invalid or unenforceable, shall remain in full force and
effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the transactions contemplated hereby or thereby, as the case may be, is not affected in any manner adverse to any Party. Upon such
determination, the Parties shall negotiate in good faith in an effort to agree upon such a suitable and equitable provision to affect the original intent of the Parties. 
 Section 9.10 Force Majeure. No Party (or any Person acting on its behalf) shall have any liability or responsibility for failure to fulfill any obligation (other than a payment obligation)
under this Agreement so long as and to the extent to which the fulfillment of such obligation is prevented, frustrated, hindered or delayed as a consequence of circumstances of force majeure. A Party claiming the benefit of this provision shall, as
soon as reasonably practicable after the occurrence of any such event: (a) notify the other Party of the nature and extent of any such force majeure condition and (b) use due diligence to remove any such causes and resume performance under
this Agreement as soon as reasonably practicable. 
 Section 9.11 Authorization. Each of the Parties hereby
represents and warrants that it has the power and authority to execute, deliver and perform this Agreement, that this Agreement has been duly authorized by all necessary corporate action on the part of such Party, that this Agreement constitutes a
legal, valid and binding obligation of each such Party and that the execution, delivery and performance of this Agreement by such Party does not contravene or conflict with any provision of law or of its charter or bylaws or any material agreement,
instrument or order binding on such Party. 
 Section 9.12 No Third Party Beneficiaries. The provisions of this
Agreement are solely for the benefit of the Parties and are not intended to confer upon any Person except the Parties any rights or remedies hereunder. There are no Third Party beneficiaries of this Agreement and this Agreement shall not provide any
Third Party, including, without limitation, any current or former employee or director of either Party, with any remedy, claim, liability, reimbursement, claim of action or other right in excess of those existing without reference to this Agreement.

 Section 9.13 Construction. The Parties have participated jointly in the negotiation and drafting of this
Agreement. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting or causing any instrument to be drafted. 
 Section 9.14 Separation Agreement. To the extent not inconsistent with any specific term of this Agreement, the provisions of
the Separation Agreement shall apply in relevant part to this Agreement, including Article VII (Confidentiality), Article IX (Dispute Resolution), Sections 9.5 (Limitation of Liability), 11.1 (Termination), 12.4 (Assignability), 12.10 (Headings),
12.13 (Specific Performance), 12.14 (Amendments) and 12.15 (Waiver of Jury Trial) thereof. 
 [Remainder of this page
intentionally left blank.] 
  

 11 

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

			
	 PHARMACEUTICAL PRODUCT
 DEVELOPMENT, INC.

		
	By:	 	  

	Name:	 	  

	Title:	 	  

  

			
	FURIEX PHARMACEUTICALS, INC.
		
	By:	 	  

	Name:	 	  

	Title:	 	  

 [Signature page to Employee Matters Agreement] 
  

 12Form of Transition Services Agreement

 Exhibit 10.4 
 TRANSITION SERVICES AGREEMENT 
 This Transition
Services Agreement (the “Agreement”) is entered into as of the    day of            , 2010, by and between Pharmaceutical Product
Development, Inc., a North Carolina corporation (“PPD”), and Furiex Pharmaceuticals, Inc., a Delaware corporation (“Furiex”). 
 WHEREAS, PPD and Furiex have entered into a Separation and Distribution Agreement dated as of the date hereof (the
“SDA”), pursuant to which, among other things, Furiex will acquire assets and liabilities of the Business (as defined in the SDA), all on the terms and conditions set forth in the SDA; 
 WHEREAS, capitalized terms used in this Agreement but not defined herein shall have the meanings given to them in the SDA; and 

WHEREAS, PPD has agreed to provide to Furiex, which may include its Subsidiaries, if any, services as described herein; 
 NOW, THEREFORE, in consideration of the mutual covenants and agreements of the parties contained herein, the parties agree as follows:

 1. Services Provided. 
 1.1 During the period commencing on the Distribution Date (as defined in the SDA) and ending on the Initial Termination Date (as defined below), as such date may be extended hereunder (but not later than
the Final Termination Date (as defined below)), and subject to the terms hereof, PPD shall provide to Furiex, or at PPD’s option shall cause one or more of its Subsidiaries or one or more third parties to provide to Furiex, the services and
functions generally described in Annex A to this Agreement and as more particularly described in individual Transition Agreements (each a “Service” and collectively, the
“Services”). 
 1.2 PPD and Furiex shall negotiate in good faith more detailed descriptions of the
Services, including those activities necessary to transition the Services to Furiex, and any additional Services agreed upon by the parties, in various sub-transition agreements (“Transition Agreements” or
“TAs”), and any services or functions jointly agreed to by PPD and Furiex in such TAs will be deemed part of the Services. The Services shall not include the exercise of business judgment or general management for Furiex.

 1.3 Except as otherwise provided in this Section 1.3, PPD shall not be required to provide any Service to the extent:
(a) that the performance of the Service would (i) require PPD or any of its Subsidiaries to violate any applicable Law (including any applicable codes or standards of conduct established by any Governmental Entity with respect to their
activities subject to the jurisdiction of such Governmental Entity) or any internal policy reasonably adopted in order to comply with any applicable Law, (ii) result in the breach of any software license, lease or other Contract, or
(iii) require prior approval of a Governmental Entity (except to the extent such approval has already been obtained); or (b) that PPD cannot provide such

 
Service due to a Force Majeure Event (as defined below), provided, however that PPD shall resume such Service as soon as practicable after such Force Majeure Event. In the event that there is
nonperformance of any Service pursuant to this Section 1.3 PPD and Furiex agree to work together in good faith to arrange for an alternative means by which Furiex may obtain, at its sole cost and expense, the Service so affected. PPD shall
cooperate with Furiex in connection with the performance of the Services, including producing on a timely basis all Contracts, documents and other information reasonably requested. 
 1.4 Furiex shall receive the Services under this Agreement and the TAs. PPD shall perform or shall cause its Subsidiaries to perform the
Services for Furiex in accordance with the terms of this Agreement and the applicable TA. Each such TA will incorporate the terms and conditions of this Agreement by reference, and will not deviate from such terms, except as expressly set forth in
each such TA. Each TA shall be considered an exhibit to this Agreement and not a stand-alone agreement. Unless otherwise expressly agreed in writing by the Parties, all invoices for such Services will be paid by Furiex in accordance with
Section 3 below. 
 1.5 Transition Management. 
 1.5.1 PPD and Furiex each agree to (i) designate an appropriate point of contact for all questions and issues relating to the Services
for each of the related Transition Agreements during the term of this Agreement (“Transition Managers”) and (ii) make available the services of appropriate qualified employees and resources to allow for the provision of
the Services and to allow each Party to perform its duties, responsibilities and obligations related to the Services. 
 1.5.2
PPD’s and Furiex’s designated transition team leaders for each of the TAs will be included in such TAs. 
 1.6 Furiex
shall make a commercially reasonable and good faith effort to assume performance of all of the Services and functions as soon as practicable and for each service included in the Services on or prior to the date specified for such service in any
related TA. In furtherance of the foregoing, Furiex shall use commercially reasonable efforts to make or obtain any approvals, permits and licenses and implement any systems as are necessary for it to provide the Services and functions independently
as soon as practicable following the Distribution Date. 
 1.7 Furiex shall provide PPD with such information and documentation
as is reasonably necessary for PPD to perform the Services and perform such other duties and tasks as reasonably required to permit PPD to perform the Services. 
 1.8 Furiex acknowledges and agrees that during the term of this Agreement, PPD may engage in upgrades, testing and related activities with respect to PPD’s systems and information technology
infrastructure. To the extent the Services received by Furiex rely on PPD’s systems and information technology infrastructure, Furiex will reasonably cooperate with PPD with respect to such upgrades, testing and activities. 
 1.9 Furiex hereby acknowledges that PPD utilizes outsourcing relationships with, and

  

 2 

 
uses software of, third parties (“Service Providers”) who might, through PPD’s obligations under this Agreement, be delivering Services to Furiex or whose software
might be used by PPD to provide Services to Furiex. Furiex further acknowledges that PPD’s provision of such Services or use of such software are subject to the terms and conditions of agreements between PPD and such Service Providers. To the
extent required under any such Service Provider agreements governing such Services or software, Furiex agrees to cooperate with PPD and will assist PPD in obtaining third-party consents, licenses, sublicenses or approvals necessary to permit PPD or
the applicable Service Provider to perform or otherwise make available to Furiex the Services set forth in this Agreement (including any TA) or to permit PPD to use the applicable software to provide the Services set forth in this Agreement
(including any TA). Neither Furiex nor PPD shall have any obligation to expend funds or incur obligations in order to obtain any such third-party consents, licenses, sublicenses or approvals. PPD shall have no liability under this Agreement in the
event PPD is unable to procure the performance of any Services because of any action or inaction of any third party, including, but not limited to, any breach of any Service Provider agreement or the termination of any license or service agreement
by a Service Provider. 
 1.10 Except as may be set forth in a TA or elsewhere in this Agreement, PPD shall not be required to
provide Furiex with extraordinary levels of Services, special studies, training or the like, or the benefit of systems, equipment, facilities, training or improvements procured, obtained or made after the Distribution Date by PPD. Nothing in this
Agreement will require PPD to favor the businesses of Furiex over its own businesses or those of any of its Subsidiaries. 
 2.
Fees. 
 2.1 The amount to be charged on a monthly basis for the Services will be set forth in each individual TA
(the “Monthly Charge”). The Monthly Charge will begin to be payable starting on the Distribution Date, provided that if the Distribution Date does not occur at the beginning of a calendar month, any non time and materials
charges in the initial Monthly Charge will be pro-rated. The non time and materials charges in the Monthly Charge payable with respect to the month in which Services are concluded may be pro-rated to the extent provided for in the applicable TA.

 2.2 In addition to the Monthly Charge, Furiex shall also reimburse PPD for all out-of-pocket expenses (pre-approved in writing
if greater than $ [            ]) that are incurred in connection with the performance of the Services, including, without limitation, travel expenses, shipping and postage costs, copying
and printing fees, and any Service Provider fees incurred by PPD in connection with the Services. Notwithstanding the foregoing, Furiex acknowledges and agrees that the fees under certain Service Provider agreements must be advanced and paid up
front by Furiex. 
 2.3 PPD shall invoice Furiex for the Service provided hereunder and the out of pocket expenses incurred in
arrears on a monthly basis. Furiex shall pay all such invoices promptly but in no event later than 30 days after the date of invoice. Late payments shall bear interest at the prime rate then in effect, plus 5% per annum or the maximum amount

  

 3 

 
allowed by law, whichever is less. Furiex shall notify PPD immediately, and in no event later than 30 days following receipt of PPD’s invoice, of any disputed charges. After such time
period, Furiex will be deemed to have accepted PPD’s invoice. PPD shall provide supporting information and documentation as reasonably requested by Furiex to validate any amounts payable by Furiex pursuant to this Section. In the event Furiex
disputes a portion of a PPD invoice, Furiex shall pay all undisputed portions of such invoice within the 30 day time period noted above. 
 3.
Security. Each Party will and shall cause its Subsidiaries to, and PPD will use commercially reasonable efforts to cause the Service Providers to, handle and protect from disclosure all proprietary and confidential information and systems
disclosed to it by the other Party, or accessible within PPD’s information technology infrastructure, consistent with each Party’s respective obligations under the SDA with respect to confidentiality, and Article [VIII] (Access to
Information and Services) of the SDA is incorporated herein by reference. The provision of the Services shall be subject to such additional confidentiality and security requirements as PPD may reasonably require from time to time. 
 4. Property Rights. Any and all materials, deliverables or other products created or developed by PPD or its Subsidiaries on behalf of Furiex
(“Furiex Property”) from the date hereof through the Final Termination Date (as defined herein) shall be owned by Furiex and PPD hereby assigns all right, title and interest to Furiex Property to Furiex. Notwithstanding the foregoing,
Furiex acknowledges and agrees that PPD does not hereby convey, nor does Furiex hereby obtain, any right, title, or interest in or to any of PPD’s or any of its Subsidiaries’ equipment, materials, deliverables, products, or any other
rights or property used to provide the Services. All customer and personnel data, files and input and output materials and the media upon which they are located that are supplied by Furiex in connection with this Agreement shall remain Furiex’s
property, respectively, and PPD shall not have any rights or interests with respect thereto. 
 5. Disclaimer and Limitation of
Liabilities. EACH PARTY ACKNOWLEDGES AND AGREES (A) THAT ALL SERVICES ARE PROVIDED BY PPD ON AN “AS IS” BASIS, AND (B) THAT PPD MAKES NO REPRESENTATIONS OR WARRANTIES, WHETHER STATUTORY, EXPRESS, OR IMPLIED, TO FURIEX
OR ANY OF ITS AFFILIATES (AS DEFINED IN THE SDA) WITH RESPECT TO THE SERVICES, ANY EQUIPMENT OR MATERIALS PROVIDED UNDER THIS AGREEMENT, OR OTHERWISE HEREUNDER, INCLUDING ANY WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, OR ANY
WARRANTIES ARISING FROM COURSE OF DEALING OR USAGE OF TRADE. 
 NO PARTY SHALL UNDER ANY CIRCUMSTANCES BE LIABLE TO ANY OTHER
PARTY FOR ANY SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES (INCLUDING LOSS OF PROFITS OR REVENUE, LOSS OF BUSINESS, LOSS OF USE OR OF DATA, INTERRUPTION OF BUSINESS OR OTHERWISE) RESULTING OR ARISING FROM THE SERVICES,
ANY PERFORMANCE OR NONPERFORMANCE OF THE SERVICES OR TERMINATION OF THE SERVICES REGARDLESS OF WHETHER SUCH DAMAGES OR OTHER RELIEF

  

 4 

 
ARE SOUGHT BASED ON BREACH OF WARRANTY, BREACH OF CONTRACT, NEGLIGENCE, STRICT LIABILITY IN TORT, OR ANY OTHER LEGAL OR EQUITABLE THEORY, EXCEPT TO THE EXTENT THAT ANY SUCH DAMAGES RELATE TO A
CLAIM FOR INDEMNIFICATION PURSUANT TO SECTION 13 HEREOF, A BREACH OF ANY OF THE CONFIDENTIALITY PROVISIONS OF THIS AGREEMENT OR THE SDA, OR FRAUD, GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF FURIEX. 
 IN NO EVENT SHALL THE AGGREGATE LIABILITY OF PPD AND ITS AFFILIATES TO FURIEX AND ITS AFFILIATES, FOR ANY DAMAGES CONCERNING PPD’S OR
ITS AFFILIATES’ OR SUBCONTRACTORS’ PERFORMANCE OR NONPERFORMANCE OF THE SERVICES OR ANY OTHER MATTER ARISING OUT OF, OR RELATED TO, THIS AGREEMENT (REGARDLESS OF WHETHER ANY SUCH CLAIM FOR SUCH DAMAGES IS BASED IN CONTRACT OR IN TORT)
EXCEED THE AMOUNTS ACTUALLY PAID TO PPD BY FURIEX PURSUANT TO THIS AGREEMENT. 
 IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE
OTHER FOR CONSEQUENTIAL, SPECIAL OR PUNITIVE DAMAGES, INCLUDING, WITHOUT LIMITATION, LOST PROFITS AND BUSINESS INTERRUPTION. 
 6. Dispute
Resolution. In the event of any dispute between PPD and Furiex with respect to the provision of any Service pursuant to this Agreement, such dispute shall be resolved in accordance with the provisions in Section 9.2 of the SDA.

 7. Term, Extension and Termination. 
 7.1 This Agreement shall become effective on the Distribution Date and, unless sooner terminated in accordance with the terms hereof, shall continue in effect until the earlier of the last TA to expire,
or no later than twenty-four (24) months following the Distribution Date (the “Final Termination Date”). 
 7.2 Extension of TAs and the Agreement. 
 7.2.1 Each TA will specify the same termination date, which
shall be twelve (12) months after the effective date of each TA (the “Initial Termination Date”). Furiex may extend specific individual TAs to continue past the Initial Termination Date but not past the Final Termination
Date, up to two (2) times. Furiex shall, to the extent possible, give notice of extension in writing at least thirty (30) days prior to the expiration of the applicable term for such Service (as set forth in the applicable TA) or
expiration of the first Extension Period (as defined below), as applicable. Each such extension must be mutually agreed to by both PPD and Furiex. Each extension will be in a six (6) month increment (an “Extension Period” or
the “Extension Periods”) unless a shorter time is set forth in the applicable Extension Period request. This Agreement shall not terminate as long as an Extension Period is effective; provided however that in no case will
this Agreement continue beyond the Final Termination Date. 
 7.2.2 In no event will PPD provide Services beyond the Final
Termination Date. 
  

 5 

 7.3 This Agreement, any individual TA or any individual Service under any TA may be
terminated earlier in accordance with any of the following provisions: 
 7.3.1 By mutual written consent of both PPD and Furiex.

 7.3.2 By Furiex effective as of the last day of the month immediately following the month in which written notice is given.

 7.3.3 By either party entitled to the benefit of the performance of any of the obligations under this Agreement (the
“Non-Defaulting Party”), if the other party (the “Defaulting Party”) shall fail to perform or default in such performance in any material respect, subject to compliance with the remainder of this
paragraph. The Non-Defaulting Party shall give written notice to the Defaulting Party specifying the nature of such failure or default and stating that the Non-Defaulting Party intends to terminate this Agreement with respect to the Defaulting Party
if such failure or default is not cured within thirty (30) days after receipt of such written notice. If any failure or default so specified is not cured within such period, the Non-Defaulting Party may elect to immediately terminate the
applicable TA with respect to the Defaulting Party; provided, however, that if the failure or default relates to a dispute contested in good faith by the Defaulting Party, the Non-Defaulting Party may not terminate this Agreement pending the
resolution of such dispute in accordance with Section 6 hereof. Such termination shall be effective upon giving a written notice of termination from the Non-Defaulting Party to the Defaulting Party and shall be without prejudice to any other
remedy which may be available to the Non-Defaulting Party against the Defaulting Party. 
 7.3.4 Automatically, without notice by
or to either party, if (a) Furiex shall (1) apply for or consent to the appointment of, or the taking of possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its properties, (2) make
a general assignment for the benefit of its creditors, (3) commence a voluntary case under the United States Bankruptcy Code, as now or hereafter in effect (the “Bankruptcy Code”), (4) file a petition seeking to
take advantage of any laws (the “Bankruptcy Laws”) relating to bankruptcy, insolvency, reorganization, winding-up, or composition or readjustment of debts, (5) fail to controvert in a timely and appropriate manner, or
acquiesce in writing to, any petition filed against it in any involuntary case under the Bankruptcy Code, or (6) take any corporate action for the purpose of effecting any of the foregoing; or (b) a proceeding or case shall be commenced
against Furiex in any court of competent jurisdiction, seeking (1) its liquidation, reorganization, dissolution or winding-up, or the composition or readjustment of its debts, (2) the appointment of a trustee, receiver, custodian,
liquidator or the like of Furiex or of all or any substantial part of its assets, or (3) similar relief under any Bankruptcy Laws, or an order, judgment or decree approving any of the foregoing shall be entered and continue unstayed for a
period of 60 days, or an order for relief against Furiex shall be entered in an involuntary case under the Bankruptcy Code. 
 7.3.5 By PPD, effective immediately upon notice to Furiex, if any of the following shall occur: (a) the sale, transfer or other disposition of all or substantially all of the assets of

  

 6 

 
Furiex; or (b) the acquisition by a single party or group, in one transaction or a series of related transactions, of beneficial ownership of a majority of the outstanding shares of common
stock of Furiex. 
 7.3.6 As otherwise may be specified in a TA. 
 7.4 Furiex specifically agrees and acknowledges that all obligations of PPD to provide each Service hereunder shall immediately cease upon
the Initial Termination Date (as extended), or the date of termination of such Service (but not later than the Final Termination Date), and PPD’s obligations to provide all of the Services for which PPD is responsible hereunder shall
immediately cease upon the termination of this Agreement. The treatment upon termination of any work in progress shall be governed by the applicable TA. 
 7.5 Notwithstanding the expiration or early termination of this Agreement or any Services hereunder, Sections 3 through 6 and 8 through 18 will survive. 
 8. Independent Contractors. The Parties understand and agree that this Agreement does not make either of them an agent or legal representative
of the other for any purpose whatsoever. No Party is granted, by this Agreement or otherwise, any right or authority to assume or create any obligation or responsibilities, express or implied, on behalf of or in the name of the other Party, or to
bind the other Party in any manner whatsoever. The Parties expressly acknowledge that PPD is an independent contractor with respect to Furiex in all respects, including, without limitation, the provision of the Services, and that the Parties are not
partners, joint venturers, employees or agents of or with each other. 
 9. Force Majeure. Neither Party will be held liable to
the other for any delay or failure of performance to the extent such delay or failure results from events beyond that Party’s control, including without limitation acts of God, earthquakes, fires, floods, civil disturbance, strikes, labor
disputes and governmental action (a “Force Majeure Event”). The Party claiming suspension due to a Force Majeure Event shall give prompt notice to the other Party hereto of the occurrence of the Force Majeure Event giving
rise to the delay or failure to perform under this Agreement and of its nature and anticipated duration, and such Party will use its reasonable efforts to cure the cause of the delay or failure to perform promptly and shall resume performance as
soon as the Force Majeure Event has ended. 
 10. Internal Controls and Procedures. PPD shall maintain and comply with such
internal controls and procedures as are necessary to comply with the Sarbanes-Oxley Act of 2002 or as otherwise agreed by the Parties to be implemented by the Parties to comply with internal controls and procedures or applicable Law. In the event
either PPD or Furiex requires a change to the internal controls or procedures, or requires the implementation of additional internal controls or procedures, related to the Services required to be provided to Furiex in order for either PPD or Furiex
to comply with applicable Law, PPD shall change or add to its internal controls or procedures related to such Services as reasonably requested by Furiex; provided, however, in connection with a change or addition to internal controls
or procedures as required by the foregoing, the party requiring the change shall pay for any and all additional costs and expenses associated with the implementation or maintenance of the applicable change or addition;

  

 7 

 
provided further, however, that if such change or addition is required for the compliance by both Parties with a Law applicable to both Parties, the Parties shall share the
costs and expenses associated with such change or addition equally. 
 11. Books and Records. The Parties shall keep and maintain
books, records, accounts and other documents sufficient to reflect accurately and completely the transactions conducted, and all associated costs incurred, pursuant to this Agreement. Such records shall include receipts, invoices, memoranda,
vouchers, inventories, timesheets and accounts pertaining to the Services, as well as complete copies of all contracts, purchase orders, service agreements and other such arrangements entered into in connection therewith. 
 12. Compliance With Laws and Governmental Requirements. Each Party shall be responsible for compliance with all applicable Laws, including, but not
limited to any applicable privacy Laws. Furiex shall be responsible for any use it may make of the Services to assist it in complying with applicable Laws. PPD shall comply with all Laws applicable to the provision by it of the Services hereunder.
Each Party shall comply with the accounting and reporting requirements of any Governmental Entity having jurisdiction over it with respect to its performance or receipt of the Services. 
 13. Indemnity. 
 13.1 Furiex hereby agrees to indemnify, defend and hold
harmless PPD and each of its Affiliates from and against any and all claims, losses, demands, liabilities, costs and expenses (including reasonable attorneys’ fees and costs and expenses related thereto) suffered or incurred by PPD or any of
its Affiliates as a result of or in connection with the provision of the Services hereunder except to the extent caused by fraud, gross negligence or willful misconduct of PPD or any of its Affiliates. 
 13.2 PPD Indemnity. PPD hereby agrees to indemnify, defend and hold harmless Furiex and each of its Affiliates from and against any
and all claims, losses, demands, liabilities, costs and expenses (including reasonable attorney’s fees and costs and expenses related thereto) suffered or incurred by Furiex or any of its Affiliates as a result of, or in connection with, any
third party claims to the extent caused by the fraud, gross negligence or willful misconduct of PPD or any of its Affiliates in performing the Services. 
 13.3 Procedures. Any claim for indemnification under this Section 13 shall be governed by, and be subject to, the provisions of Article V of the SDA, which provisions are hereby incorporated
by reference into this Agreement and any references to “Agreement” in such Article V as incorporated herein shall be deemed to be references to this Agreement. 
 14. Miscellaneous. The provisions of Article XII (Miscellaneous) of the SDA (except for Section 12.12 (Waivers of Default)) are hereby incorporated into this Agreement. 
 15. Annexes and TAs. Annex A and the TAs shall be construed with and as an integral part of this Agreement to the same extent as
if the same had been set forth verbatim herein. In the

  

 8 

 
event of any inconsistency between the terms of Annex A or any TA and the terms set forth in the main body of this Agreement, the terms of this Agreement shall govern unless
expressly stated otherwise in a TA. 
 16. Subcontractors and Outsourcing. PPD shall have the right to subcontract or outsource
any of its obligations hereunder. 
 17. Taxes. All amounts expressed in each TA are exclusive of value added taxes, sales taxes
and any other similar taxes. Furiex will be responsible for such taxes (other than taxes based on net income or net profits of PPD or its Affiliates) imposed by applicable taxing authorities on the procurement of Services hereunder. If PPD or any of
its Affiliates are required to pay such taxes, Furiex shall promptly reimburse PPD therefor. 
 18. Confidential Information. Any
confidential Information received by either Party or its Affiliates from the other Party or any of its Affiliates in connection with this Agreement shall be governed by, and be subject to, the provisions of Article VII of the SDA, which provisions
are hereby incorporated by reference into this Agreement and any references to “Agreement” in such Article VII as incorporated herein shall be deemed to be references to this Agreement. 
 [SIGNATURE PAGE FOLLOWS] 
  

 9 

 IN WITNESS WHEREOF, the Parties hereto have executed this Transition Services Agreement as
of the day and year first above written. 
  

			
	FURIEX PHARMACEUTICALS, INC.
		
	By:	 	  

	Name:	 	  

	Title:	 	  

  

			
	PHARMACEUTICAL PRODUCT
DEVELOPMENT, INC.
		
	By:	 	  

	Name:	 	  

	Title:	 	  

 [Signature page to Transition Services Agreement] 

 Annex A 
 List of Services 
  

	 	•	 	 Human resources services 

  

	 	•	 	 Financial services, including, but not limited to, tax services, treasury services and corporate accounting services 

  

	 	•	 	 Information technology services 

  

	 	•	 	 Travel services 

  

	 	•	 	 Corporate communications services

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00168-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00168-of-00352.parquet"}]]