Document:

Technical Transfer & Development Services Agreement

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

EXHIBIT 10.3 

Execution Copy 
  

 
  

TECHNICAL TRANSFER & DEVELOPMENT SERVICES AGREEMENT 

by and between 

INSPIRE PHARMACEUTICALS, INC. 

and 

FINORGA S.A.S. 

Dated as of March 26, 2010 
  

 
  

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 TABLE OF CONTENTS 

 

					
	 	  	 	  	Page No.
		
	 ARTICLE I    DEFINITIONS
	  	2
		
	 ARTICLE II    TECHNICAL TRANSFER PROGRAM
	  	6
			
	 2.1
	  	 General
	  	6
	 2.2
	  	 Inspire Materials
	  	6
	 2.3
	  	 Technical Transfer Program; Project Plan
	  	7
	 2.4
	  	 Changes
	  	8
	 2.5
	  	 Personnel and Resources
	  	8
	 2.6
	  	 Meetings
	  	8
	 2.7
	  	 Specifications
	  	9
		
	 ARTICLE III    NOVASEP’S SERVICES AND
OBLIGATIONS
	  	9
			
	 3.1
	  	 Facility and Equipment
	  	9
	 3.2
	  	 Quality Agreement
	  	10
	 3.3
	  	 Third Party Materials
	  	10
	 3.4
	  	 Batches
	  	11
	 3.5
	  	 Release and Shipment of Batches
	  	11
	 3.6
	  	 Sale of API
	  	12
	 3.7
	  	 Batch Samples
	  	12
	 3.8
	  	 Novasep’s Site and Company Registrations
	  	12
	 3.9
	  	 Compliance with Laws
	  	13
	 3.10
	  	 Taxes
	  	13
	 3.11
	  	 Access to and Retention of Information
	  	13
		
	 ARTICLE IV    INSPIRE OBLIGATIONS
	  	14
			
	 4.1
	  	 Technology Transfer
	  	14
	 4.2
	  	 API Registrations
	  	14
	 4.3
	  	 Payments
	  	14
		
	 ARTICLE V    REPRESENTATIONS AND WARRANTIES
	  	15
			
	 5.1
	  	 Novasep Representations and Warranties
	  	15
	 5.2
	  	 Inspire Representations and Warranties
	  	17
	 5.3
	  	 Warranties
	  	17
		
	 ARTICLE VI    INTELLECTUAL PROPERTY
	  	17
			
	 6.1
	  	 Ownership
	  	17
	 6.2
	  	 New Developments and Modifications
	  	18
	 6.3
	  	 Grant of Licenses
	  	19
	 6.4
	  	 Infringement
	  	19

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

					
	 6.5
	  	 Data
	  	19
		
	 ARTICLE VII    CONFIDENTIALITY
	  	20
			
	 7.1
	  	 Definition of “Inspire Confidential Information”
	  	20
	 7.2
	  	 Definition of “Novasep Confidential Information”
	  	20
	 7.3
	  	 Treatment of Confidential Information
	  	20
	 7.4
	  	 Excluded Information
	  	21
	 7.5
	  	 Return of Confidential Information
	  	22
		
	 ARTICLE VIII    INDEMNIFICATION
	  	22
			
	 8.1
	  	 Indemnity by Novasep
	  	22
	 8.2
	  	 Indemnity by Inspire
	  	23
	 8.3
	  	 Liability limitations
	  	23
	 8.4
	  	 Procedures
	  	23
		
	 ARTICLE IX    TERM; TERMINATION; REMEDIES
	  	23
			
	 9.1
	  	 General
	  	24
	 9.2
	  	 Termination for Bankruptcy; Insolvency
	  	24
	 9.3
	  	 Termination for Default After Notice
	  	24
	 9.4
	  	 Termination by Inspire for Change in Control of Novasep
	  	24
	 9.5
	  	 Termination by Inspire for Convenience
	  	24
	 9.6
	  	 No Suspension of Obligations
	  	24
	 9.7
	  	 Effect of Termination
	  	25
		
	 ARTICLE X    MISCELLANEOUS
	  	25
			
	 10.1
	  	 Notices
	  	25
	 10.2
	  	 Independent Contractors
	  	26
	 10.3
	  	 Entire Understanding
	  	26
	 10.4
	  	 Force Majeure Event
	  	26
	 10.5
	  	 Assignment
	  	27
	 10.6
	  	 Dispute Resolution
	  	27
	 10.7
	  	 Use of Affiliates
	  	28
	 10.8
	  	 Subcontractors
	  	28
	 10.9
	  	 Amendment
	  	28
	 10.10
	  	 Severability
	  	28
	 10.11
	  	 Waiver
	  	28
	 10.12
	  	 Survival
	  	28
	 10.13
	  	 Drafting Ambiguities
	  	29
	 10.14
	  	 Headings; Schedules and Exhibits; Counterparts
	  	29
	 10.15
	  	 Governing Law
	  	29
	 10.16
	  	 Remedies
	  	29
	 10.17
	  	 Injunctive Relief
	  	29
	 10.18
	  	 Further Assurances
	  	30
	 10.19
	  	 Counterparts
	  	30

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

					
	 10.20
	  	 English Language
	  	30

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 SCHEDULES TO AGREEMENT: 

 

			
	 Schedule A:
	 	 Project Plan

		
	 Schedule B:
	 	 Project Fees

		
	 Schedule C:
	 	 Equipment

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

TECHNICAL TRANSFER & DEVELOPMENT SERVICES AGREEMENT 

THIS TECHNICAL TRANSFER & DEVELOPMENT SERVICES AGREEMENT (this “Agreement”) is made and
entered into as of the 26th day of March, 2010 (the “Effective Date”) by and between Inspire Pharmaceuticals, Inc., a Delaware corporation having a place of business at 4222 Emperor Blvd., Suite 200, Durham, NC 27703, USA
(“Inspire”), and Finorga S.A.S., a corporation organized and existing under the laws of France, having a place of business at Route de Givors, 38670 Chasse sur Rhône, France, acting in its own name and in the name and on behalf of
Novasep Process, a corporation organized and existing under the laws of France, having a place of business at Site Eiffel, Boulevard de la Moselle, 54340 Pompey, France (collectively “Novasep”). Inspire and Novasep are sometimes referred
to herein individually as a “Party” and collectively as “Parties.”  
 RECITALS

 WHEREAS, Inspire is engaged in the research, development and commercialization of proprietary
pharmaceutical products; 
 WHEREAS, Novasep is a company that has developed substantial expertise in
manufacturing active pharmaceutical ingredients for use in pharmaceutical products; and 
 WHEREAS, Groupe
Novasep SAS (an Affiliate of Novasep) and Inspire have signed a Mutual Confidential Disclosure Agreement dated February,
6th 2008, in order to exchange certain Confidential
Information in connection with certain services and the manufacturing of the API (as defined below); and 

WHEREAS, Novasep and Inspire are working together since February 2009 on certain services relating to the API and have
signed a Material Transfer Agreement dated March, 31st
2009, following which Inspire transferred to Novasep certain quantities and samples of materials; and 

WHEREAS, Finorga / Novasep Synthesis France (an Affiliate of Novasep) and Inspire have signed a Letter of Intent dated
July 31st, 2009 (the “Letter of Intent”) by
which Inspire confirmed its commitment with respect to certain capital equipment expenses of Novasep; and 

WHEREAS, the Parties desire to provide in this Agreement for the transfer by Inspire of technologies required by Novasep
to begin production of a certain active pharmaceutical ingredient for Inspire; and 
 WHEREAS, Inspire, by the
following purchase orders, has ordered from Novasep certain development services and deliverables in relation to the API, including laboratory familiarization, process & analytical transfer, process optimization, testing and selection of
the best process: Purchase Order #005605 dated March 24, 2009; Purchase Order 
  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
#005721 dated June 26, 2009; Purchase Order #005771 dated August 11, 2009; Purchase Order #005772 dated August 11, 2009; Purchase Order #005773 dated August 11, 2009; Purchase
Order #005824 dated September 21, 2009; Purchase Order #005851 dated October 15, 2009; Purchase Order #005900 dated November 16, 2009; Purchase Order #005931 dated December 21, 2009; and Purchase Order #005932 dated
December 21, 2009 (collectively, the “Purchase Orders”); and 
 WHEREAS, Finorga SAS and Novasep
Process are wholly-owned subsidiaries of Groupe Novasep S.A.S., and contemporaneously with this Agreement Groupe Novasep S.A.S. is entering into and delivering to Inspire the Parent Guarantee between such parties; 

NOW, THEREFORE, in consideration of the foregoing recitals, mutual covenants, agreements, representations and warranties
contained herein, the Parties hereby agree as follows: 
 ARTICLE I 

DEFINITIONS 

“Affiliate” means a corporation or non-corporate business entity that, directly or indirectly, controls, is
controlled by, or is under common control with the Person specified, for so long as such control continues. An entity will be regarded as in control of another entity if: (a) it owns, directly or indirectly, at least 50% of the voting
securities or capital stock of such entity, or has other comparable ownership interest with respect to any entity other than a corporation; or (b) it possesses, directly or indirectly, the power to direct or cause the direction of the
management and policies of the corporation or non-corporate business entity, as applicable, whether through the ownership or control of voting securities, by contract or otherwise. 

“API” means denufosol tetrasodium
(P1-(2’-deoxycytidine
5’-)P4-(uridine 5’)tetraphosphate tetrasodium).

 “API Developments” has the meaning provided in Section 6.2(a) of this Agreement. 

“Batch” means Demonstration Batch, Development Batch or Validation Batch. 

“Change Control Operating Procedure” has the meaning provided in Section 2.4 of this Agreement.

 “Change in Control” has the meaning provided in Section 9.4 of this Agreement. 

“Claim” has the meaning provided in Section 8.1 of this Agreement. 

“Confidential Information” has the meaning provided in Section 7.3 of this Agreement. 

 

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 “Consent” means any consent, authorization, permit,
certificate, license or approval of, exemption by, or filing or registration with, any Governmental Body or other Person. 

“Current Good Manufacturing Practices” or “cGMPs” means all applicable standards relating to
manufacturing practices for intermediates, active pharmaceutical ingredients or finished pharmaceutical products, including without limitation: (i) the principles detailed in the U.S. Current Good Manufacturing Practices, 21 C.F.R. Parts 210
and 211, The Rules Governing Medicinal Products in the European Community, Volume IV Good Manufacturing Practice for Medicinal Products, and Q7A Good Manufacturing Practice Guidance For Active Pharmaceutical Ingredients (ICH Q7A), (ii) the
principles promulgated by any applicable Governmental Body having jurisdiction over the manufacture of the API, in the form of laws, rules or regulations, and (iii) the principles promulgated by any applicable Governmental Body having
jurisdiction over the manufacture of the API, in the form of guidance documents (including but not limited to advisory opinions, compliance policy guides and guidelines), which guidance documents are being implemented within the pharmaceutical
manufacturing industry for such products; in each case as in effect at the Effective Date and as amended, promulgated or accepted by any applicable Governmental Body from time to time during the Term. 

“Data” has the meaning provided in Section 6.5 of this Agreement. 

“Demonstration Batch” has the meaning provided in Section 3.4 of this Agreement. 

“Development Batch” has the meaning provided in Section 3.4 of this Agreement. 

“Equipment” has the meaning provided in Section 3.1(b) of this Agreement. 

“Facility” means Novasep’s manufacturing facilities located at (i) Route de Givors, 38670
Chasse-sur-Rhône, France (Finorga), (ii) Site Eiffel, Boulevard de la Moselle, 54340 Pompey, France (Novasep Process), (iii) 5 Chemin du Pilon, 01703 Saint Maurice de Beynost, France (Novasep Process) and any other facility approved
in advance in writing by Inspire. 
 “Force Majeure Event” has the meaning provided in
Section 10.4 of this Agreement. 
 “Governmental Body” means any nation or government, any state,
province or other political subdivision thereof, or any entity with legal authority to exercise executive, legislative, judicial, regulatory or administrative functions, or any division of the United States Food and Drug Administration (as
applicable) and any other applicable counterpart agency that administers the Legal Requirements. 

“Indemnified Party” has the meaning provided in Section 8.4 of this Agreement. 

 

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 “Indemnifying Party” has the meaning provided in
Section 8.4 of this Agreement. 
 “Initial Materials” means dCMP (2’-deoxycytidine
5’-monophosphate). 
 “Inspire Confidential Information” has the meaning provided in
Section 7.1 of this Agreement. 
 “Inspire Intellectual Property” means any and all Intellectual
Property relating to the API or the development or manufacture thereof that was (i) owned, licensed or controlled by Inspire or Inspire Affiliates at the Effective Date or (ii) developed or acquired by Inspire or Inspire Affiliates after
the Effective Date. 
 “Inspire License” has the meaning provided in Section 6.3 of this
Agreement. 
 “Inspire Materials” has the meaning provided in Section 2.2 of this Agreement.

 “Inspire Rights” has the meaning provided in Section 6.3 of this Agreement. 

“Intellectual Property” means (i) patents, patent rights, provisional patent applications, patent
applications, designs, registered designs, registered design applications, industrial designs, industrial design applications and industrial design registrations, including any and all divisions, continuations, continuations-in-part, extensions,
restorations, substitutions, renewals, registrations, revalidations, reexaminations, reissues or additions, including supplementary certificates of protection, of or to any of the foregoing items; (ii) copyrights, copyright registrations,
copyright applications, original works of authorship fixed in any tangible medium of expression, including literary works (including all forms and types of computer software, including all source code, object code, firmware, development tools,
files, records and data, and all documentation related to any of the foregoing), musical, dramatic, pictorial, graphic and sculptured works; (iii) trade secrets, technology, developments, discoveries and improvements, know-how, proprietary
rights, formulae, confidential and proprietary information, technical information, techniques, inventions, designs, drawings, procedures, processes, models, formulations, manuals and systems, whether or not patentable or copyrightable, including all
biological, chemical, biochemical, toxicological, pharmacological and metabolic material and information and data relating thereto and formulation, clinical, analytical and stability information and data which have actual or potential commercial
value and are not available in the public domain; (iv) trademarks, trademark registrations, trademark applications, service marks, service mark registrations, service mark applications, business marks, brand names, trade names, trade dress,
names, logos and slogans, internet domain names, and all goodwill associated therewith; and (v) all other intellectual property or proprietary rights worldwide, in each case whether or not subject to statutory registration or protection.

 “Legal Requirements” means any and all local, municipal, state, provincial, federal and
international laws, statutes, ordinances, rules or regulations now or hereafter enacted or promulgated by any Governmental Body applicable to the development, approval, manufacture, sale or licensing of any pharmaceutical products, ingredients for

  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
inclusion therein, or any aspect thereof and the obligations of Novasep or Inspire, as the context requires, under this Agreement, including, without limitation, the United States Federal Food,
Drug and Cosmetic Act, as amended, and the rules and regulations promulgated thereunder. 
 “Losses”
means, collectively, any and all claims, liabilities, damages, costs, expenses, including reasonable fees and disbursements of counsel and any consultants or experts and expenses of investigation, obligations, liens, assessments, judgments, fines
and penalties imposed upon or incurred by an Indemnified Party. 
 “Novasep Confidential Information”
has the meaning provided in Section 7.2 of this Agreement. 
 “Novasep Intellectual Property”
means (i) all Intellectual Property owned, licensed or controlled by Novasep prior to the Effective Date and (ii) all Intellectual Property developed or acquired by Novasep after the Effective Date that does not relate to the API or the
development or manufacture of the API, and does not utilize and is not based on any Inspire Rights or Inspire Confidential Information. 

“Person” means any individual, corporation, company, partnership, trust, incorporated or unincorporated
association, joint venture or other entity of any kind. 
 “Project Plan” has the meaning provided in
Section 2.3 of this Agreement. 
 “Project Team” has the meaning provided in Section 2.5 of
this Agreement. 
 “Quality Agreement” means the agreement identified in Section 3.2 of this
Agreement. 
 “Specifications” means, with respect to the API, all specifications for materials,
approved suppliers, formula, manufacturing, analytical and testing procedures, release, packaging, labeling and other processes relating to the manufacture of the API, all as set forth in the Request for Proposal (RFP) – INS37217 Technology
Transfer and Commercial Manufacture dated and provided by Inspire to Novasep via email on February 10, 2009, as such specifications may be updated by Inspire or revised from time to time in accordance with this Agreement. 

“Subcontractor” means any Third Party that performs any of Novasep’s obligations under this Agreement on
Novasep’s behalf. 
 “Supply Agreement” has the meaning provided in Section 2.1 of this
Agreement. 
 “Technical Transfer Program” has the meaning provided in Section 2.1 of this
Agreement. 
 “Term” has the meaning provided in Section 9.1 of this Agreement. 

 

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 “Third Party” means any Person other than the Parties or their
respective Affiliates. 
 “Third Party Materials” means (i) all raw materials, components,
work-in-process and other ingredients required to manufacture the API and (ii) all packaging materials used in the manufacture, storage and shipment of the API, in each case, other than Inspire Materials. 

“Validation Batch” has the meaning provided in Section 3.4 of this Agreement. 

ARTICLE II 

TECHNICAL TRANSFER PROGRAM 

2.1 General. Subject to the terms and conditions of this Agreement, Inspire agrees to transfer to Novasep
technology and technical information in Inspire’s possession necessary for the manufacture of the API at the Facility, and Novasep agrees to (i) develop and confirm the manufacturing process for the API; (ii) assist in establishing
final Specifications; (iii) manufacture Batches of the API; and (iv) conduct all other activities specified in the Project Plan, including without limitation technology transfer, scale-up, method transfer, method development and
validation, process development, process optimization and process validation (collectively, the “Technical Transfer Program”), all as more specifically provided in this Agreement. The Parties contemplate entering into an additional
agreement relating to Novasep’s manufacture of the API for Inspire following the successful completion of the Technical Transfer Program (the “Supply Agreement”). The Parties hereby agree to negotiate the terms of such Supply
Agreement in good faith. Notwithstanding the foregoing, the Parties shall not be obligated to enter into the Supply Agreement. 

2.2 Inspire Materials. Inspire or its designee shall supply Initial Materials to Novasep on a reasonably prompt
basis for use in the Technical Transfer Program in quantities reasonably sufficient to carry out the Technical Transfer Program in accordance with this Agreement. Prior to the delivery of any of such Initial Materials to Novasep, Inspire or its
designee shall, if available, provide to Novasep a copy of the Material Safety Data Sheet for the Initial Materials, as currently in effect, and thereafter shall promptly provide any subsequent revisions thereto. Novasep acknowledges that the
Material Safety Data Sheet has been generated by the Third Party supplier of the Initial Materials and that the accuracy thereof has not been independently confirmed by Inspire. Novasep accordingly agrees to exercise due care and judgment in
handling and using the Initial Materials. Without limiting the foregoing, Novasep shall be responsible for inspecting, testing and releasing Initial Materials as necessary to perform the Technical Transfer Program. All materials, including but not
limited to, Initial Materials, samples and specimens, supplied by or on behalf of Inspire or its designees to Novasep, including derivatives thereof (collectively “Inspire Materials”), are and shall at all times remain the sole property of
Inspire, whether such Inspire Materials remain unused or are contained in any work-in-process or finished product. Novasep shall handle, store, use and dispose 

 

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
of Inspire Materials in accordance with the Specifications, cGMPs, all applicable Legal Requirements and the terms and conditions of this Agreement. Novasep shall have responsibility for and bear
the risk of loss of any Inspire Materials after receipt thereof by Novasep. Inspire Materials may only be used by Novasep for the API set forth herein and may not be provided to any Third Party other than a Subcontractor approved by Inspire pursuant
to Section 10.8 solely for purposes of testing and releasing Inspire Materials as necessary to perform the Technical Transfer Program. Any and all Inspire Materials shall be returned to Inspire or its designees upon the earlier of
(a) Inspire’s request or (b) the termination or expiration of this Agreement. In the alternative, if Inspire requests that remaining Inspire Materials be destroyed, Novasep shall destroy such Inspire Materials and certify in writing
that such Inspire Materials have been destroyed in accordance with all Legal Requirements. In the event that Novasep loses, destroys or damages any Inspire Materials such that they cannot be used in connection with any API, Novasep shall reimburse
Inspire for Inspire’s expenses incurred in connection with procuring and shipping Inspire Materials to replace such lost, destroyed or damaged Inspire Materials. 

2.3 Technical Transfer Program; Project Plan. Schedule A attached hereto (the “Project Plan”)
details the specific tasks and functions to be performed by the Parties in the Technical Transfer Program, including, but not limited to, the time schedule, documentation, reports, Equipment and technical assistance. The Project Team members
periodically shall review the Project Plan, consult as to its continuing suitability and implement any revisions thereto that are mutually agreed in writing by the Parties in accordance with the provisions of Section 10.9 below. In addition,
Inspire may, in its sole discretion, upon providing written notice to Novasep, revise the Project Plan to reflect changes in Legal Requirements, import or export restrictions, delays in the implementation of the Project Plan and the Parties’
technical capabilities. Novasep recognizes the importance of, and agrees to use best efforts to ensure, timely performance of its obligations under this Agreement in accordance with the Project Plan. The Parties acknowledge that since the work
detailed in the Project Plan is of a developmental nature, experimental or technical circumstances beyond Novasep’s control may prevent or delay completion of the Technical Transfer Program. In the event of such circumstances, Novasep shall
nevertheless use best efforts to perform its obligations under this Agreement in as timely a manner as possible under such circumstances. In the event of (i) any proposed change in the Project Plan including with respect to any time schedule or
(ii) any notice from Inspire of a revision permitted to be made in Inspire’s sole discretion under this Section 2.3, Novasep shall notify Inspire as promptly as practicable of any other adjustments to the Project Plan that Novasep
proposes in light of Inspire’s revisions and the Parties shall then negotiate in good faith an adjusted Project Plan including, if appropriate, a revised time schedule to provide reasonable accommodation for the changed circumstances. Without
limiting the foregoing, if the Parties fail to achieve agreed objectives, costs or timelines set forth in the Project Plan, the Party responsible for that deviation will (i) provide to the other Party a written description of the deviation, the
cause and a proposed solution, and (ii) lead negotiations of a solution to minimize the impact of the delay or failure on the Technical Transfer Program. The Parties acknowledge that, as of the Effective Date, the Parties already have begun to
undertake 
  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
the activities set forth in the Project Plan, and the Parties agree that all such activities occurring prior to the Effective Date will constitute activities covered and governed by the terms and
conditions of this Agreement. The Parties acknowledge and agree that the deadline for completion of the Development Batches, excluding full results of outsourced analysis, in accordance with the Project Plan shall be [c.i.], and that the deadline
for completion of process validation, including delivery of the final process validation report, in accordance with the Project Plan shall be [c.i.]. 

2.4 Changes. Promptly after the Effective Date, the Parties shall work together and cooperate in good faith to
establish in writing the procedures to be followed in the event either Inspire or Novasep desires to change any aspect of the process by which the API is manufactured, including but not limited to any change in the Specifications (the “Change
Control Operating Procedures”), and such written procedures shall be deemed a part of this Agreement and incorporated herein by reference, as if fully set forth herein. Any modification of the Change Control Operating Procedures shall be
mutually agreed in writing by the Parties in accordance with the provisions of Section 10.9 below. Novasep shall not make any revisions to the Specifications, and shall not implement any change in the manufacturing process for the API, in each
case, unless it has complied with the Change Control Operating Procedures. Without limiting the foregoing, Novasep shall not make any such revisions or implement any such changes without first obtaining the prior written consent of Inspire.

 2.5 Personnel and Resources. Novasep shall commit to the Technical Transfer Program a project manager
and additional appropriate personnel (including, without limitation, those with expertise in technical development, manufacturing, operations, quality control, quality assurance and regulatory affairs) and appropriate manufacturing and storage space
and equipment at the Facility to accomplish the Project Plan within the time schedule set forth therein. Inspire shall commit such of its personnel with appropriate expertise to provide monitoring and, as appropriate, technical consultation for the
Technical Transfer Program. The Parties shall each designate a project team for the Technical Transfer Program (each, a “Project Team”), with each Party designating a Project Team leader and other members who possess expertise appropriate
to the current stage of the Technical Transfer Program. Each Party may replace or supplement the members on the Project Team with other individuals possessing the requisite expertise by providing written notice of such replacement or supplement to
the other Party. The Project Team shall hold teleconferences or meetings as agreed by Project Team members or as requested by either Party, but not less than twice monthly. 

2.6 Meetings. During the Term, the Parties shall meet every two (2) months, or more frequently if desired by
either Party, to review the status of the Technical Transfer Program, determine progress under the Project Plan and receive reports or recommendations from the Project Team. Novasep’s representative at such meetings shall be its project manager
designated for the Technical Transfer Program and Inspire’s representative at such meetings shall be its Project Team leader designated for the 

 

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
Technical Transfer Program. Additional personnel of either Party may be designated by such Party in its discretion to attend such meetings. 

2.7 Specifications. The Parties will establish the final Specifications for manufacturing, packaging and labeling
for the API in accordance with the Project Plan and subject to Inspire’s approval. The final Specifications will be comparable to the initial Specifications with regards to purity and potency, and consistent with all requirements imposed by
cGMPs and Legal Requirements. 
 ARTICLE III 

NOVASEP’S SERVICES AND OBLIGATIONS 

3.1 Facility and Equipment. 

(a) Novasep shall perform its obligations under this Agreement solely at the Facility unless Inspire
consents in writing otherwise. Novasep shall, at its own expense, maintain the Facility in compliance with cGMPs and Legal Requirements. 

(b) Novasep shall, in accordance with the Project Plan, design in collaboration with Inspire and procure,
install and qualify the equipment specified in Schedule C at the Facility (collectively, the “Equipment”). Final selection of the Equipment shall be made by Novasep, subject to Inspire’s prior approval. 

(c) Novasep shall keep the Equipment at the Facility, use it to accomplish the Project Plan or perform
its obligations under the Supply Agreement, provide Inspire with access to the Equipment upon Inspire’s request, including without limitation under such terms and conditions as may be agreed in the Supply Agreement, and maintain, at
Novasep’s own expense, the Equipment in good operating condition and in compliance with cGMPs and Legal Requirements. Inspire agrees that when the Equipment is not required in connection with the Project Plan or the manufacturing of the
Product, Novasep shall have the right, subject to Inspire’s prior written approval, to use the Equipment for other purposes. Novasep will communicate requested time slots in advance to Inspire, and Inspire will have the right to approve such
time slots on a case-by-case basis. Inspire’s written approval will not be unreasonably withheld or delayed. Novasep’s right to use the Equipment in each case shall be subject to all of the remaining terms and conditions of this Agreement,
including without limitation the following conditions: 
  

	 	 (i)
	 there is no conflict with Inspire’s need for the Equipment in connection with this Agreement or the Supply Agreement, and

  

	 	 (ii)
	 the Equipment is cleaned by Novasep in compliance with cGMPs and Legal Requirements after its use for other purposes, and

  

	 	 (iii)
	 Novasep pays Inspire a fee of [c.i.] €/week of utilization (including set-up, production and cleaning), during the period beginning on the
Effective date and ending on the [c.i.] anniversary of the Effective Date. The fee will 

  

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

	 	
be calculated based on the time elapsed between initiation of set-up and completion of cleaning for the applicable use and paid at the end of each calendar quarter. 

Notwithstanding the foregoing, the resins used or required to be used in connection with the Project Plan or the
manufacturing of the Product shall not be used for any purposes other than the Project Plan or the manufacture of the Product. The Equipment shall be solely owned by Inspire, and Novasep shall execute or cause to be executed any documents requested
by Inspire to evidence or otherwise establish such ownership. Novasep shall mark the Equipment as owned by Inspire in a manner reasonably approved by Inspire. Novasep shall keep the Equipment free and clear of any liens or encumbrances and shall not
transfer or assign the Equipment, and any such purported encumbrance, transfer or assignment shall be null and void. Novasep shall not make or cause to be made any material alterations or modifications to the Equipment without Inspire’s prior
written approval. Novasep will maintain adequate insurance to cover the cost of replacement of the Equipment, and the risk of loss for the Equipment will be borne by Novasep. 

(d) Inspire shall have the right to take possession of the Equipment at any time, by sending to Novasep a
written notice explaining that Inspire intends to take possession of the Equipment. In this case, Novasep shall provide reasonable assistance to facilitate removal of the Equipment from the Facility by Inspire, and the reasonable, documented costs
for removal and transportation of the Equipment will be paid by Inspire. 
 (e) In the event
that Inspire makes a public announcement that it is discontinuing its program for the development and commercialization of an API-based product, then Inspire and Novasep agree to discuss and negotiate in good faith to reach mutually acceptable terms
and conditions for the transfer of ownership of the Equipment from Inspire to Novasep. If no such mutually acceptable terms can be agreed between the Parties, then Inspire shall take possession of the Equipment, and the reasonable, documented costs
for removal and transportation of the Equipment will be paid by Inspire, and Novasep shall provide reasonable assistance to facilitate removal of the Equipment from the Facility by Inspire. 

3.2 Quality Agreement. Novasep and Inspire have entered into a Quality Agreement for the API
effective as of July 2, 2009 (the “Quality Agreement”). Novasep and Inspire shall comply with the Quality Agreement in performing their activities under this Agreement.  

3.3 Third Party Materials. Novasep shall be responsible for procuring, inspecting, testing and releasing adequate
Third Party Materials as necessary to perform the Technical Transfer Program. Novasep will obtain Third Party Materials for API produced under this Agreement only from Third Party suppliers named in the

  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
Specifications, where applicable, or otherwise meeting the Specifications and approved in advance by Inspire. 

3.4 Batches. Novasep shall manufacture kilolab batches, pilot batches and proof of process batches of the API as
specified in the Project Plan (each, a “Demonstration Batch”). Novasep also shall manufacture development batches of the API as specified in the Project Plan (“Development Batch”). Novasep also shall manufacture batches of the
API for the purposes of conducting validation studies as specified in the Project Plan (each, a “Validation Batch”). Inspire, in consultation with Novasep, will use the data from Validation Batches to finalize the Specifications consistent
with regulatory expectations for purity, potency and other API characteristics. Novasep shall perform all validation studies specified in the Project Plan and as required by the Technical Transfer Program, Specifications, cGMPs or Legal Requirements
in order to qualify the API produced at the Facility for incorporation into finished pharmaceutical products for commercial sale worldwide.  

3.5 Release and Shipment of Batches. 

(a) Novasep shall implement and perform operating procedures and controls for testing, validation,
documentation and release of the API and such other quality assurance and quality control procedures as are required by the Specifications, cGMPs, Legal Requirements, and this Agreement and the Quality Agreement. Prior to release of the API, Novasep
shall test the API in accordance with the testing procedures described in (i) the Specifications, (ii) cGMPs, (iii) Legal Requirements, (iv) those procedures and in-plant quality control checks applicable to any products produced
by Novasep, and (v) such other methods and procedures as Inspire may reasonably determine. In the event that such other methods or procedures determined by Inspire create additional costs and/or expenses for Novasep, the Parties will negotiate
in good faith to determine responsibility for such costs and/or expenses. Novasep shall provide Inspire with the applicable master batch record and any other information as requested by Inspire. Additionally, Novasep shall provide Inspire with a
Certificate of Analysis for each batch of API. “Certificate of Analysis” means a document identified as such and provided by Novasep to Inspire that (i) sets forth the analytical test results for a specified batch of API,
(ii) states that such API is in conformance with the Specifications, and (iii) states that such API is manufactured in accordance with the Specifications, Legal Requirements, cGMPs, all other regulatory documents, and such other methods as
Inspire may determine. 
 (b) Inspire may request delivery of any API to Inspire or a Third
Party, including without limitation for purposes of testing and releasing the API at a Third Party. In such event, Novasep shall ship the API FCA the Facility (as defined in INCOTERMS, 2000 edition, published by the International Chamber of
Commerce, ICC Publication 560), except with regard to title and risk of loss, which are described below in this Section 3.5(b). Freight and insurance shall be 

 

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
for the account of Inspire, and the risk of loss, delay or damage in transit shall be with Inspire from and after delivery to Inspire’s designated carrier. Novasep shall use commercially
reasonable efforts to assist Inspire in arranging any desired insurance. Novasep shall package the API for shipment (including but not limited to containers, packaging, container closure systems and labeling) in accordance with Inspire’s
instructions and its customary practices therefore. In the event that these instructions and customary practices create additional costs and/or expenses for Novasep, the Parties will negotiate in good faith to determine responsibility for such costs
and/or expenses. In the event of any conflict between Inspire’s packaging instructions and Novasep’s customary practices, the Parties shall endeavor in good faith to resolve such conflict as quickly as practicable. Novasep shall include
the following with each shipment of the API: (i) a copy of the applicable Certificate of Analysis; (ii) the Batch numbers; (iii) the quantity of the API; (iv) a copy of the applicable Batch report; and (v) a copy of the
Material Safety Data Sheet for the API. Title to and risk of loss for any API shall pass from Novasep to Inspire when such API is picked up by the carrier at the Facility. If any API is rejected by Inspire after shipment under this Agreement, and
such API is to be returned to Novasep, then title to and risk of loss for the rejected API shall pass from Inspire to Novasep when such API is placed in the possession of the carrier for return to Novasep or for shipment on behalf of Novasep to a
destination designated by Novasep. 
 3.6 Sale of API. Novasep shall neither market nor
sell the API produced under this Agreement except for sales to Inspire permitted by this Agreement. Novasep shall not use any process developed under this Agreement with or on behalf of any Third Party.  

3.7 Batch Samples. Novasep shall retain samples from each Batch of API for a period of thirty-six (36) months
after the expiration date for such Batch or such longer period required by Legal Requirements. Novasep shall handle, store, use and dispose of all Third Party Materials, API or API derived wastes in compliance with Specifications and in accordance
with cGMPs and all applicable Legal Requirements and the terms and conditions of this Agreement. 
 3.8
Novasep’s Site and Company Registrations. Novasep shall prepare, and provide to Inspire for review and comment, all necessary documentation for any registrations of Novasep under applicable Legal Requirements as a manufacturer of active
pharmaceutical ingredients, or as a site manufacturing the API, for incorporation in finished pharmaceutical products for commercial sale worldwide. Inspire may, in its discretion, handle or cause any agent or representative to handle the filing of
such registrations relating to the API. Inspire shall be entitled to monitor or participate in all of Novasep’s interactions with Governmental Bodies with respect to Novasep’s production of the API. Upon notice of any visit to or
inspection of the portion or portions of the Facility used in the manufacture of the API by an authorized agent of a Governmental Body, Novasep shall promptly notify Inspire and permit Inspire to review

  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
and provide comment regarding all related correspondence between Novasep and the Governmental Body. 

3.9 Compliance with Laws. In carrying out its obligations under this Agreement, Novasep shall comply
in all respects with cGMPs and Legal Requirements in effect from time to time. Prior to the manufacture of the API at the Facility, Novasep shall timely obtain all necessary inspections and Consents needed for it to perform its obligations under
this Agreement. The Parties will promptly notify each other of any material revisions or amendment of or additions to cGMPs and will confer with each other with respect to the best means to comply with such requirements.  

3.10 Taxes. 

(a) Novasep shall pay and otherwise be responsible for all applicable sales, goods, services, transfer
and similar taxes in connection with any payment made to Novasep pursuant to this Agreement. 

(b) Any income or other tax that one Party is required to withhold and pay on behalf of the other Party
with respect to amounts payable under this Agreement shall be deducted from said amounts prior to payment to the other Party; provided, however, that in regard to any tax so deducted, the Party making the withholding shall give or cause to be given
to the other Party such assistance as may reasonably be necessary to enable that other Party to claim exemption therefrom or credit therefor, and in each case shall furnish the Party on whose behalf amounts were withheld, proper evidence of the
taxes paid on its behalf. Each Party shall comply with reasonable requests of the other Party to take any proper actions that may minimize any withholding obligation. 

3.11 Access to and Retention of Information. 

(a) Novasep shall provide to Inspire for its review copies of all data generated during the Technical
Transfer Program, including without limitation, stability and validation data, as may be requested by Inspire from time to time and in any format. 

(b) Novasep shall provide Inspire representatives access during Novasep’s regular working hours to
the portions of the Facility being utilized for manufacture of the API, including without limitation at the times specified in the Project Plan, for the purpose of observing, reporting on and consulting as to such manufacturing efforts, including
review of Novasep’s safety and quality procedures, plans and implementation, and shall cooperate with Inspire representatives in fulfilling their responsibilities, including making temporary desk space, knowledgeable personnel and other
reasonable resources available to the Inspire representatives. Inspire and Novasep shall discuss the results of any review by Inspire and agree upon any modifications required to produce API in

  

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
accordance with the Specifications, cGMPs, Legal Requirements and this Agreement. 

(c) Novasep shall maintain, in accordance with and for the period required under cGMPs and Legal
Requirements or any longer period specified in the Quality Agreement, complete and systematic records pertaining to all activities in connection with, and the portion or portions of the Facility used for, the manufacture, processing, testing,
packaging, labeling, storage and distribution of the API, Third Party Materials or Inspire Materials. Novasep shall keep accurate books and accounts of record in connection with the manufacture, use and/or sale by it of API hereunder in sufficient
detail to permit accurate determination of all figures necessary for verification of payment obligations set forth in this Agreement. Such records related to verification of payment obligations shall be maintained for a period of five (5) years
from the end of each year to which it relates. Novasep shall maintain and keep records required under this Agreement in English. 

(d) Novasep shall from time to time upon request of Inspire provide Inspire with access during
Novasep’s regular working hours to, and copies of, all records retained by Novasep pursuant to this Agreement, including without limitation any records Novasep is required to maintain pursuant to this Article III. Novasep shall cooperate with
Inspire during its inspection or audit of such records. 
 ARTICLE IV 

INSPIRE OBLIGATIONS 

4.1 Technology Transfer. Inspire shall provide on a reasonably prompt basis technology and technical information
reasonably necessary for Novasep to perform the Agreement, including without limitation, validated analytical procedures for all non-compendial testing, reference standards of the API and major impurities, API formulations and Specifications,
labeling specifications, packaging configurations, and manufacturing safety information, all in accordance with the schedule specified in the Project Plan. Inspire’s personnel with appropriate expertise will be available from time to time to
participate in meetings or teleconferences with Novasep’s specialists in order to facilitate the proper performance of the Project Plan attached to the Agreement. 

4.2 API Registrations. Inspire shall be responsible for filing and strategy relating to all API registrations, and
Novasep shall support Inspire’s efforts by providing all documentation relating to Inspire’s ongoing API registrations as specified in the Project Plan. 

4.3 Payments. 

(a) For all work performed under this Agreement, Inspire shall pay Novasep as provided for on Schedule B
attached hereto. Novasep acknowledges 
  

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
and agrees that Inspire has paid in full all amounts contemplated to be invoiced prior to the Effective Date pursuant to Schedule B. Inspire agrees to reimburse Novasep for actual documented
out-of-pocket costs reasonably incurred as a result of travel required by Novasep’s personnel in the performance of Novasep’s obligations under this Agreement, provided such costs are contemplated in the Project Plan or approved in advance
by Inspire and submitted for reimbursement to Inspire in a timely manner. All payments made under this Agreement shall be made in Euros unless otherwise agreed in writing by the Parties. 

(b) All invoices for expenses and fees shall be submitted by Novasep on or about the twenty-fifth (25
th) day of each month during the Term for review and
processing. All invoices shall include the following: (i) ‘Invoice’ written on the top of the document, (ii) the date of the invoice, (iii) an invoice number, (iv) a description of the items manufactured, or services
rendered, as the case may be, (v) the total amount being invoiced in the applicable currency for payment and (vi) a reference to this Agreement and the original Inspire purchase order number, and shall be submitted to: 

Inspire Pharmaceuticals, Inc. 

4222 Emperor Boulevard, Suite 200 

Durham, North Carolina 27703-8466 

Attention: Accounts Payable 

Email: isphap@inspirepharm.com 

Inspire shall pay each invoice consistent with this Section 4.3(b) within thirty (30) days of receipt of the
invoice, subject in each case to Inspire’s right to dispute invoice amounts and/or delay the payment of disputed invoices under this Agreement. Payments of invoices incorrectly addressed or from which any of the information required by this
Section 4.3(b) has been omitted may take longer than thirty (30) days. 
 ARTICLE V 

REPRESENTATIONS AND WARRANTIES 

5.1 Novasep Representations and Warranties. Novasep represents and warrants that: 

(a) Novasep will manufacture, store and handle each Batch in accordance with cGMPs (except as otherwise
set forth in the Project Plan) and Legal Requirements applicable to that Batch’s anticipated use and in conformity with the Specifications in effect at the time of production. Novasep shall ensure that the services provided under this Agreement
are performed in a competent, professional, workmanlike and timely manner by qualified personnel in conformance with the standard of care usually and reasonably expected in the 

 

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
performance of such services, this Agreement and reasonable instructions provided by Inspire. 

(b) Novasep will provide each Batch to Inspire free and clear of any liens or encumbrances. 

(c) Novasep is a validly existing corporation in good standing under the laws of the jurisdiction of its
incorporation; the execution, delivery and performance of this Agreement by Novasep has been duly authorized by all requisite corporate action; this Agreement constitutes a legal, valid and binding obligation of Novasep, enforceable against Novasep
in accordance with the terms hereof; and the execution, delivery and performance of this Agreement by Novasep will not violate or conflict with any other agreement or instrument to which Novasep is a party. 

(d) The equipment used in the production of the API, including the Equipment, will be adequate to timely
produce (in accordance with the Project Plan, cGMPs, Legal Requirements and other agreed Inspire requirements) API, in the amounts required pursuant to Section 5.1(h) below, that consistently meets or exceeds the final Specifications. All such
equipment will be in good operating condition and will be maintained in good operating condition for the Term. 

(e) Novasep has not used, and will not use during the Term, in any capacity associated with or related to
the manufacture of the API, the services of any Persons who have been, or are in the process of being, (i) debarred under 21 U.S.C. § 335a(a) or (b) or any comparable Legal Requirements, or (ii) excluded from participation in the
Medicare program, any state Medicaid program or any other federal health care program. Furthermore, neither Novasep nor any of its officers, employees, or consultants has been convicted of an offense under (x) either a federal or state law that
is cited in 21 U.S.C. § 335(a) as a ground for debarment, denial of approval, or suspension, or (y) any other law cited in any comparable Legal Requirements as a ground for debarment, denial of approval or suspension. Novasep shall notify
Inspire immediately upon learning of any circumstance that would cause this certification under this Section 5.1(e) to become false or inaccurate. 

(f) Novasep has, and will maintain and comply with, all Consents necessary in performance of its
obligations hereunder and the manufacture of the API for incorporation in finished pharmaceutical products for commercial sale worldwide. 

(g) There is no claim, suit, proceeding, or other investigation pending, or to the knowledge of Novasep,
threatened, which is likely to prevent or materially affect Novasep’s ability to perform its obligations hereunder. 
  

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 (h) After installation of the Equipment, Novasep will
have and will maintain during the Term, the capacity to supply to Inspire 1000 kilograms per year of the API. 

5.2 Inspire Representations and Warranties. Inspire represents and warrants that: 

(a) Inspire is a validly existing corporation in good standing under the laws of Delaware; the execution,
delivery and performance of this Agreement by Inspire has been duly authorized by all requisite corporate action; this Agreement constitutes a legal, valid and binding obligation of Inspire, enforceable against Inspire in accordance with the terms
hereof; and the execution, delivery and performance of this Agreement by Inspire will not violate or conflict with any other agreement or instrument to which Inspire is a party. 

(b) To Inspire’s knowledge as of the Effective Date, Inspire has the authority to provide the
Inspire Intellectual Property and the Inspire Materials to Novasep under this Agreement and to authorize Novasep to utilize the Inspire Intellectual Property and the Inspire Materials in accordance with this Agreement. 

(c) As of the Effective Date, there is no claim, suit, proceeding, or other investigation pending, or to
the knowledge of Inspire, threatened in writing, which is likely to prevent or materially affect Inspire’s ability to perform its obligations hereunder. 

5.3 WARRANTIES. THE FOREGOING EXPRESS WARRANTIES IN SECTIONS 5.1 AND 5.2 ARE IN LIEU OF ALL OTHER WARRANTIES,
EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE, OR AGAINST INFRINGEMENTS, AND ALL OTHER WARRANTIES ARE HEREBY DISCLAIMED AND EXCLUDED BY EACH PARTY. 

ARTICLE VI 

INTELLECTUAL PROPERTY 

6.1 Ownership. 

(a) Inspire Ownership. Novasep acknowledges and agrees that, as between Inspire and Novasep,
Inspire owns all rights in and to the Inspire Intellectual Property, including all Intellectual Property rights in and to the API, the drug application for the API, the Data and documentation, specifications and processes associated with the API. In
particular, Novasep acknowledges and agrees that: (i) all of the Specifications contain valuable trade secrets and Inspire Confidential Information and are and shall remain the copyrighted works of Inspire; and (ii) all of the patents,
trademarks and software files owned by Inspire 
  

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which apply to the manufacture, use or sale of API are and shall remain Inspire Intellectual Property. Except as expressly provided in Section 6.3 below, nothing in this Agreement shall be
deemed to transfer or convey, expressly or by implication, any Inspire Rights to Novasep. 
 (b)
Novasep Ownership. Inspire acknowledges and agrees that Novasep owns all rights in and to the Novasep Intellectual Property. Novasep may not implement or use any Novasep Intellectual Property in a manner that would require a change to the
Specifications, or in a manner in which the compliance of the API with cGMPs or Legal Requirements would become dependent upon such Novasep Intellectual Property, without the prior written consent of Inspire with respect to such implementation or
use. In the event that Novasep implements or uses any Novasep Intellectual Property in such a manner without the prior written approval of Inspire, Novasep hereby grants to Inspire and Inspire Affiliates a non-exclusive, irrevocable, royalty-free,
worldwide, fully sublicensable, perpetual license to use such Novasep Intellectual Property solely with the API and products containing the API and their manufacture. 

6.2 New Developments and Modifications. 

(a) API Developments. All Intellectual Property relating to the API or the development or
manufacture of the API, or that utilizes or is based on any Inspire Rights or Inspire Confidential Information, that is conceived, reduced to practice, authored, or otherwise invented, discovered, generated or developed in whole or in part in the
course of activities under this Agreement, whether patentable or not, and any authorship of works relating to the API, including any trademarks, trade dress, trade secrets or copyrights, shall be “API Developments.” 

(b) Ownership of API Developments. Without further payment to Novasep and subject only to the
rights and licenses granted in Section 6.3 below, Inspire shall own all right, title and interest in and to all API Developments, whether made, conceived, reduced to practice, authored or otherwise invented, discovered, generated or developed
solely by or on behalf of Novasep or Inspire, or jointly by or on behalf of Novasep and Inspire, and all rights to Intellectual Property arising therefrom. Novasep will, and hereby does, assign to Inspire all of its rights, title and interest in and
to API Developments and rights to Intellectual Property arising therefrom. Novasep shall provide reasonable assistance to Inspire (and shall cause its employees, Affiliates and Subcontractors to do so as well) in obtaining, enforcing, and defending
Inspire’s ownership of the API Developments and appurtenant rights to Intellectual Property, at Inspire’s expense. Novasep shall ensure that each of Novasep’s employees, Affiliates and Subcontractors under this Agreement shall have in
place a binding agreement that assigns to the fullest extent possible all Intellectual Property rights arising from their activities to Novasep (for further allocation as specified in this Agreement). Novasep promptly shall inform Inspire in writing
of all API Developments and provide Inspire with all written materials related to such API Developments and, 
  

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at the request of Inspire, will meet with Inspire to discuss activities conducted under this Agreement in order to identify any API Developments. Novasep may not disclose, implement or use any
API Development without the prior written consent of Inspire. 
 (c) Patents.
Notwithstanding any obligation of confidentiality between Novasep and Inspire under Section 7.3 hereto or any other agreement, Inspire, at its own expense, may elect to file and prosecute appropriate patent applications and maintain patents
issuing therefrom covering API Developments. Upon Inspire’s reasonable request and at its expense, Novasep shall take such reasonable actions as Inspire deems necessary or appropriate to assist Inspire in obtaining patent or other proprietary
protection in Inspire’s name with respect to all API Developments. 
 6.3 Grant of Licenses. Subject
to the terms and conditions of this Agreement, Inspire hereby grants Novasep a non-exclusive, royalty-free, non-transferable, non-sublicensable license to use the Inspire Intellectual Property and the API Developments (collectively, the
“Inspire Rights”) solely to the extent necessary to perform Novasep’s obligations under this Agreement. The licenses granted in this Section 6.3 shall be collectively referred to as the “Inspire License.” Novasep shall
have no right or license to make, manufacture, supply, distribute or sell the API or use the Inspire License for any purpose other than as necessary to perform its obligations under this Agreement. The Inspire License shall immediately terminate at
the expiration or termination of this Agreement. Novasep agrees to comply with all restrictions or other terms and conditions contained in any agreements or licenses with Third Parties related to the Inspire License of which Novasep has been given
written notice. No license rights shall be created hereunder by implication, estoppel, or otherwise. 
 6.4
Infringement. Novasep shall promptly notify Inspire of any suspected or threatened infringement, misappropriation or other unauthorized use of Intellectual Property licensed by Inspire to Novasep under this Agreement that comes to
Novasep’s attention. The notice shall set forth the facts of such suspected or threatened infringement in reasonable detail. Inspire shall have the sole right, but not the obligation, to institute, prosecute and control, at its expense, any
action or proceeding against the Third Party infringer of such Intellectual Property. If Inspire institutes an action against such infringer, Novasep shall give Inspire reasonable assistance and authority to control, file and prosecute the suit as
necessary at Inspire’s expense. Inspire shall retain any damages or other monetary awards that it recovers in pursuing any action under this Section 6.4. 

6.5 Data. As between Novasep and Inspire, Inspire shall be and remain the sole and exclusive owner of any and all
data and information, in any form, relating to: (i) the business of Inspire; (ii) customers and suppliers of Inspire, as it relates to the API; (iii) the API and its development and manufacture; and (iv) any Inspire Rights
(collectively, the “Data”). The Data shall include current, historical, archived and outcomes information regarding the API, whether or not present at the Facility or in 

 

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electronic or hard-copy form. Inspire shall own all Intellectual Property rights that may subsist in the Data, and Novasep will assign, and hereby assigns, any such rights to Inspire. Novasep
agrees to access, use and disclose the Data only as and to the extent necessary and appropriate for the performance of its obligations under this Agreement. 

ARTICLE VII 

CONFIDENTIALITY 

7.1 Definition of “Inspire Confidential Information”. As used herein, the term “Inspire
Confidential Information” shall mean all confidential business and technical communications, documents and other information, whether in written, oral or other form, which Inspire or an Inspire Affiliate furnishes or discloses to Novasep or
which Novasep otherwise learns in connection with the negotiation or performance of this Agreement (whether relating to Inspire, an Inspire Affiliate or any Third Party for which Inspire has an obligation of confidentiality), including the terms of
this Agreement and any information disclosed prior to the Effective Date. Novasep represents and warrants that prior to the Effective Date, it has not used or disclosed to any Third Party any Inspire Confidential Information, except as would be
permitted hereunder. 
 7.2 Definition of “Novasep Confidential Information”. As used herein,
the term “Novasep Confidential Information” shall mean all confidential business and technical communications, documents or other information, in each case not constituting Inspire Rights or Data, whether in written, oral or other form, of
Novasep or a Novasep Affiliate that are disclosed to Inspire by Novasep or a Novasep Affiliate or Inspire otherwise learns in connection with the negotiation or performance of this Agreement; provided, however, that all information relating solely
to the API shall be Inspire Confidential Information. Inspire agrees that the provisions of this Agreement shall apply to all Novasep Confidential Information disclosed by Novasep or any Novasep Affiliate or learned by Inspire prior to the Effective
Date. 
 7.3 Treatment of Confidential Information. Both during the Term of this Agreement and
thereafter, Inspire Confidential Information and Novasep Confidential Information (collectively for this Section 7.3 “Confidential Information”) shall be treated in accordance with the requirements of this Article VII. 

(a) Nondisclosure and Non-Use. A Party receiving Confidential Information of the other Party shall
(i) maintain in confidence such Confidential Information to the same extent such Party maintains its own proprietary information of similar kind and value (but at a minimum each Party shall use commercially reasonable efforts to maintain
Confidential Information in confidence); (ii) not disclose such Confidential Information to any Third Party without prior written consent of the disclosing Party, except, in the case of Inspire, for disclosures to Inspire’s sublicensees
and commercial partners for the API who agree to be bound by obligations of non-disclosure and non-use at least as stringent as those contained in this Article VII; and (iii) not use such

  

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Confidential Information for any purpose except those purposes permitted by this Agreement. 

(b) Exceptions. Notwithstanding any other provision of this Agreement, the receiving Party may
disclose Confidential Information of the disclosing Party to a Third Party: (i) to the extent and to the Persons as required by an applicable law, rule, regulation, legal process or court order, or an applicable disclosure requirement of any
Governmental Body, the U.S. Securities and Exchange Commission, the Nasdaq market or any other securities exchange or market; or (ii) to the extent necessary to exercise the rights granted to the receiving Party under this Agreement in filing
or prosecuting patent applications, prosecuting or defending litigation or otherwise establishing rights or enforcing obligations under this Agreement, or conducting clinical trials or seeking regulatory approval with respect to a product containing
the API; provided, however, that the receiving Party shall first have given prompt notice to the disclosing Party to enable the disclosing Party to seek any available exemptions from or limitations on any applicable disclosure requirement and shall
reasonably cooperate in such efforts by the disclosing Party. 
 (c) Terms of Agreement.
The Parties agree that the existence of and the material terms of this Agreement shall be considered Confidential Information of both Parties, subject to the special authorized disclosure provisions set forth below in this Section 7.3(c) (in
lieu of the authorized disclosure provisions set forth in Section 7.3(b), to the extent of any conflict) and without limiting the generality of the definition of Confidential Information set forth in Sections 7.1 and 7.2. If either Party
desires to make a public announcement concerning this Agreement or the terms hereof, such Party shall give reasonable prior advance notice of the proposed text of such announcement to the other Party for its prior review and approval. A Party shall
not be required to seek the permission of the other Party to repeat any information as to the existence and terms of this Agreement that has already been publicly disclosed by such Party in accordance with the foregoing or by the other Party. Either
Party may disclose the terms of this Agreement to such Party’s existing investors, directors and professional advisors and to potential investors, acquirors or merger partners and their professional advisors who are bound by written or
professional obligations of non-disclosure and non-use that are at least as stringent as those contained in this Article VII or are customary for such purpose. The Parties acknowledge that Inspire may be obligated to file a copy of this Agreement
with the SEC with its next quarterly report on Form 10-Q, annual report on Form 10-K or current report on Form 8-K or with any registration statement filed with the SEC pursuant to the Securities Act of 1933, as amended, and Inspire shall be
entitled to make such filings. 
 7.4 Excluded Information. Notwithstanding any provision herein to the
contrary, the requirements of this Article VII shall not apply to any information of either Party which: 
  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 (a) at the time of disclosure hereunder is generally
available to the public; 
 (b) after disclosure hereunder becomes generally available to the
public, except through breach of this Article VII by the receiving Party or its Affiliates; 

(c) was not acquired directly or indirectly from the disclosing Party or its Affiliates and which the
receiving Party lawfully had in its possession prior to disclosure by the disclosing Party; 

(d) is independently developed by employees or agents of the receiving Party without the use of the
Confidential Information of the disclosing Party; or 
 (e) becomes available to the receiving
Party from a Third Party that is not legally prohibited from disclosing such Confidential Information, provided such information was not acquired by such Third Party directly or indirectly from the disclosing Party or its Affiliates. 

7.5 Return of Confidential Information. At any time upon the request of the other Party, to the extent such
Confidential Information is not reasonably necessary to enable a Party to perform its obligations under this Agreement, or upon expiration or termination of this Agreement, the Party receiving Confidential Information will cease its use and, upon
request, within thirty (30) days either return or destroy (and certify as to such destruction) all Confidential Information of the other Party, including any copies or other embodiments thereof, except that the receiving Party may retain a copy
for archive purposes. The return and/or destruction of such Confidential Information as provided above shall not relieve the receiving Party of its other obligations under this Article VII. 

ARTICLE VIII 

INDEMNIFICATION 

8.1 Indemnity by Novasep. Novasep shall defend, indemnify and hold harmless Inspire and each Inspire Affiliate and
its and their respective directors, officers, employees and agents from and against all Losses arising from any claim, demand, suit, action or proceeding (a “Claim”) to the extent arising out of (a) any breach, nonperformance or
failure to comply with any of Novasep’s covenants, agreements, obligations, representations or warranties under this Agreement or the terms of this Agreement; (b) recklessness or gross negligence by Novasep or Novasep Affiliates, their
respective directors, officers, employees, agents or Subcontractors; or (c) Novasep Intellectual Property infringing upon the Intellectual Property or proprietary rights of a Third Party; provided that the foregoing obligations shall not apply
to the extent that a Loss is a result of any matter for which Inspire is obligated to indemnify Novasep pursuant to Section 8.2. 
  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 8.2 Indemnity by Inspire. Inspire shall defend, indemnify and
hold harmless Novasep and each Novasep Affiliate and its and their respective directors, officers, employees and agents from and against all Losses arising from any Claim to the extent arising out of: (a) any breach, nonperformance or failure
to comply with any of Inspire’s covenants, agreements, obligations, representations or warranties under this Agreement or the terms of this Agreement; (b) recklessness or gross negligence by Inspire or Inspire Affiliates, their respective
directors, officers, employees, licensees or agents; or (c) Inspire Intellectual Property infringing upon the Intellectual Property or proprietary rights of a Third Party; provided that the foregoing obligations shall not apply to the extent
that a Loss is a result of any matter for which Novasep is obligated to indemnify Inspire pursuant to Section 8.1. 

8.3 Liability limitations. NOTWITHSTANDING ANYTHING TO THE CONTRARY HEREIN, NEITHER PARTY SHALL BE LIABLE TO THE
OTHER FOR INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES, OR LOSS OF PROFITS, OR PUNITIVE OR EXEMPLARY DAMAGES, WHETHER IN CONTRACT OR IN TORT, ARISING OUT OF ANY TERMS OR CONDITIONS IN THIS AGREEMENT OR WITH RESPECT TO THE PERFORMANCE THERETO,
EXCEPT IN CASE OF GROSS NEGLIGENCE OR WILLFUL MISCONDUCT. 
 8.4 Procedures. Any person that may be
entitled to indemnification under this Agreement (an “Indemnified Party”) shall give written notice to the Person obligated to indemnify it (an “Indemnifying Party”) with reasonable promptness upon becoming aware of any Claim or
other facts upon which a claim for indemnification will be based; the notice shall set forth such information with respect thereto as is then reasonably available to the Indemnified Party. The Indemnifying Party shall have the right to undertake the
defense of any such Claim with counsel reasonably satisfactory to the Indemnified Party and the Indemnified Party shall cooperate in such defense and make available all records, materials and witnesses reasonably requested by the Indemnifying Party
at the Indemnifying Party’s expense. If the Indemnifying Party shall have assumed the defense of the Claim with counsel reasonably satisfactory to the Indemnified Party, the Indemnifying Party shall not be liable to the Indemnified Party for
any legal or other expenses subsequently incurred by the Indemnified Party in connection with the defense thereof. The Indemnifying Party shall not be liable for any Claim settled without its consent, which consent shall not be unreasonably
withheld. The Indemnifying Party shall obtain the written consent of the Indemnified Party, which shall not be unreasonably withheld, prior to ceasing to defend, settling or otherwise disposing of any Claim if as a result thereof the Indemnified
Party would become subject to injunctive or other equitable relief or if the Indemnified Party may reasonably object to such disposition of such Claim based on a continuing adverse effect on the Indemnified Party. 

ARTICLE IX 

TERM; TERMINATION; REMEDIES 
  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 9.1 General. The term of this Agreement (the
“Term”) shall commence on the Effective Date hereof and shall continue until
December 31st, 2011, unless earlier terminated
pursuant to this Article IX.  
 9.2 Termination for Bankruptcy; Insolvency.
To the extent permitted by Legal Requirements, each Party will have the right to terminate this Agreement immediately upon notice to the other Party, if any of the following occurs: (i) such other Party is declared bankrupt or insolvent,
(ii) such other Party generally fails to pay its debts as they become due, (iii) there is an assignment for the benefit of such other Party’s creditors, (iv) a receiver is appointed or there is a voluntary or involuntary petition
filed or an action or proceeding commenced for bankruptcy, reorganization, dissolution or winding up of such other Party that is not dismissed within sixty (60) days, or (v) there is a foreclosure or sale of a material part of such other
Party’s assets by or for the benefit of any creditor or governmental agency.  
 9.3
Termination for Default After Notice. Either Party shall have the right to terminate this Agreement upon sixty (60) days’ prior written notice to the other upon or after the breach of any material provision of this Agreement by the
other Party if the breaching Party has not cured such breach within the sixty (60)-day period following written notice of termination by the non-breaching Party. 

9.4 Termination by Inspire for Change in Control of Novasep. If at any time during the Term there is or will be a
Change in Control of Novasep, Novasep shall immediately notify Inspire in writing, and upon receiving notice or otherwise becoming aware of such a Change in Control, Inspire may terminate this Agreement immediately by written notice if it considers
in its sole discretion that such Change in Control may be prejudicial to Inspire’s interests. For the purpose of this Section 9.4, “Change in Control” shall mean any proposed transaction or series of transactions which shall
result in (i) any party other than Novasep, or an entity that is an Affiliate of Novasep as of the date of this Agreement, owning the Facility, (ii) direct or indirect ownership of more than fifty percent (50%) of the voting stock or
assets of Novasep or an Affiliate that controls Novasep by Persons who are not shareholders of Novasep or the Affiliate that controls Novasep as of the date of this Agreement, or (iii) the merger of Novasep with or into a Third Party in a
transaction in which Novasep is not the surviving or acquiring party. 
 9.5 Termination by
Inspire for Convenience. After April 30, 2010, Inspire shall have a right to terminate this Agreement for any reason or no reason upon sixty (60) days written notice to Novasep. In such event, Inspire will reimburse Novasep for any
costs and non-cancelable commitments reasonably and legitimately incurred by Novasep in accordance with this Agreement with respect to any then-current work-in-process under the Technical Transfer Program, unless payments for such work-in-process
have already been made pursuant to Section 4.3 or are otherwise addressed in Section 9.7. 

9.6 No Suspension of Obligations. If any dispute arises between the Parties, in no event shall Novasep interrupt,
slow down, or reduce in any way the implementation 
  

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
of the Technical Transfer Program, unless Inspire consents or as specifically permitted by a court of competent jurisdiction. 

9.7 Effect of Termination. Upon termination of this Agreement pursuant to Sections 9.2, 9.3, 9.4,
9.5 or 10.4, Novasep shall: (i) cease work under the Project Plan and this Agreement, (ii) provide to Inspire all Data obtained or produced by Novasep during the Term, and (iii) upon Inspire’s request and at Inspire’s sole
cost and expense, assist Inspire to transfer promptly the API manufacturing process to any other facility or facilities selected by Inspire; provided that if this Agreement has been terminated by Inspire pursuant to Section 9.3, Novasep shall
be responsible for the reasonable cost and expense of such transfer. In addition, in the event that Inspire terminates this Agreement pursuant to Section 9.5, Inspire shall reimburse Novasep for its reasonable out-of-pocket and non-cancellable,
committed expenses associated with the purchase and installation of the Equipment up to that point in time, but only to the extent that such expenses have been actually incurred by Novasep and exceed two million one hundred thousand Euros (€
2,100,000), and provided that such reimbursement shall not exceed five hundred thousand Euros (€ 500,000).  

ARTICLE X 

MISCELLANEOUS 

10.1 Notices. In addition to the other specific procedures for notification provided herein, all notices, demands,
requests and other communications made hereunder shall be in writing and shall be given either by personal delivery or by internationally recognized overnight courier (with charges prepaid), and shall be deemed to have been given or made:
(i) if personally delivered, on the day of such delivery; or (ii) if sent by overnight courier, on the business day following the date deposited with such overnight courier service, in each case pending the designation of another address,
addressed as follows: 
 If to Inspire: 

Inspire Pharmaceuticals, Inc. 

4222 Emperor Boulevard, Suite 200 

Durham, North Carolina 27703-8566, USA 

Attention: General Counsel 

Facsimile: +1-919-941-9797 

If to Novasep: 

Finorga SAS 

C.E.O. 

Route de Givors 

38670 Chasse / Rhône (France) 

Telephone: +334 72 49 19 60 

Facsimile: +334 78 07 49 30 
  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 With a copy to: 

Groupe NOVASEP SAS 

Attn : Mr. Frédéric BEAUPRE 

Site Eiffel - 82, Boulevard de la Moselle 

54340 POMPEY – France 

Tel: + (33)3 83 49 70 50 

Fax: + (33)3 83 49 71 40 

10.2 Independent Contractors. Each Party shall be treated as an independent contractor of the other. Neither Party
shall be deemed to be a co-venturer, partner, employee or a legal representative of the other Party for any purpose. Neither Party shall have the authority to enter into any contracts in the name of or on behalf of the other Party or incur any
charges or expenses for or in the name of the other Party. 
 10.3 Entire Understanding. The Parties
agree, on their own and their respective Affiliates’ behalf, that this Agreement, including the Schedules hereto, and any other document identified herein, constitutes the entire agreement between the Parties and their Affiliates relating to
the subject matter hereof, and all prior agreements or arrangements, written or oral, between the Parties and their Affiliates relating to the subject matter hereof are hereby superseded by this Agreement, including without limitation (a) that
certain Mutual Confidential Disclosure Agreement between Inspire and Groupe Novasep SAS dated as of February 6, 2008, (b) that certain Materials Transfer Agreement between Inspire and Novasep dated as of March 31, 2009, (c) the
Letter of Intent, (d) that certain Offer / Costs estimation – INSPIRE Pharmaceuticals, Inc., Denufosol Project dated March 16, 2009, as updated from time to time prior to the Effective Date, and (e) the Purchase Orders. The
Parties agree, on their own and their respective Affiliates’ behalf, that the terms and conditions of this Agreement shall apply fully to any and all information disclosed, materials exchanged and activities conducted by the Parties or their
Affiliates under the Mutual Confidential Disclosure Agreement, the Materials Transfer Agreement, the Letter of Intent and the Purchase Orders as if such information was disclosed, materials were exchanged or activities were conducted by the Parties
under this Agreement. 
 10.4 Force Majeure Event. Neither Party shall be liable to the other on account
of any failure to perform or on account of any delay in performance of any of its obligations under this Agreement, if and to the extent that such failure or delay shall be due to a cause beyond the control of the relevant Party and which, by the
exercise of its commercially reasonable efforts of diligence and care, such Party could not reasonably have been expected to avoid (a “Force Majeure Event”). For the avoidance of doubt, the failure of Novasep to timely perform any of its
obligations hereunder due to an order, injunction or any other action by a Governmental Body shall not constitute a Force Majeure Event. The Party experiencing a Force Majeure Event shall promptly notify the other Party of such event, the specific
causes thereof, the probable duration of delay in performance, and use commercially reasonable efforts to perform its obligations as soon as practicable. This Agreement, in so far as it relates to such obligations, shall be deemed

  

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
suspended so long as and to the extent that such Force Majeure Event prevents, hinders or delays the performance of any obligation under this Agreement, provided that Inspire shall have the right
to terminate this Agreement immediately upon written notice if a Force Majeure Event affecting Novasep continues for more than sixty (60) days. 

10.5 Assignment. This Agreement will be binding upon and inure to the benefit of the Parties, their successors and
permitted assigns. Novasep shall not delegate, transfer, convey, assign or pledge this Agreement, in whole or in part, or any of its rights or obligations under this Agreement without the prior written consent of Inspire, and any such action without
consent shall be void. Notwithstanding the foregoing, Novasep shall be permitted to assign this Agreement to its Affiliate, provided that such Affiliate agrees with Inspire in advance in writing to be bound by all of the terms and conditions of this
Agreement and such assignment shall not relieve Novasep of any of its obligations under this Agreement. 
 10.6
Dispute Resolution. If the Parties fail to resolve any claim, dispute, or controversy of whatever nature arising out of or relating to this Agreement (other than one relating to the validity, enforceability, infringement or misappropriation
of Intellectual Property rights, which shall not be subject to this Section 10.6), the Parties shall refer the dispute to their respective officers designated below or such other officers as the Parties may designate in writing from time to
time for attempted resolution by good faith negotiations within thirty (30) days after so submitting the dispute. The designated officers are as follows: 
  

			
	 For Inspire:
	  	 Inspire Pharmaceuticals, Inc.

		  	 4222 Emperor Boulevard, Suite 200

		  	 Durham, North Carolina 27703-8466, USA

		  	 Attn: Benjamin R. Yerxa, Ph.D.

		
	 For Supplier:
	  	 Groupe NOVASEP SAS

		  	 Attn: Mr. Frédéric BEAUPRE

		  	 Site Eiffel - 82, Boulevard de la Moselle

		  	 54340 POMPEY – France

		  	 Tel: + (33)3 83 49 70 50

		  	 Fax: + (33)3 83 49 71 40

		  	 frederic.beaupre@novasep.com

If such dispute is not resolved by the end of the thirty (30) day period, the Parties shall be free to pursue any legal or equitable
remedy available to them. If any legal action or other legal proceeding is brought by a Party for the enforcement of this Agreement, or to recover damages or other applicable remedy based on the alleged dispute, breach or default in connection with
the provisions of this Agreement, the successful or prevailing Party as to any specific and separable issue in such action or proceeding (in a final decision by the applicable court action or other legal proceeding, or by settlement or otherwise)
shall be entitled to recover reasonable attorneys’ fees and other reasonable costs and expenses incurred in enforcing the specific obligation of the other Party under 

 

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
this Agreement that was the basis for such specific issue in such action or proceeding, in addition to any other relief to which it may be entitled. For avoidance of doubt, the foregoing shall
not prohibit or delay a Party from seeking appropriate injunctive or other equitable relief. 
 10.7 Use of
Affiliates. The Parties acknowledge and agree that Novasep may use the services of Novasep’s Affiliates to fulfill Novasep’s obligations under this Agreement; provided that nothing in this Section 10.7 shall relieve Novasep from
any obligation under this Agreement. Novasep shall remain responsible and be directly and primarily liable for its Affiliates’ performance hereunder, and its Affiliates shall be subject to all of the terms and conditions of this Agreement in
performing hereunder. Any failure of any Novasep Affiliate performing services hereunder to comply with any of the terms and conditions of this Agreement shall constitute a breach by Novasep for all purposes. 

10.8 Subcontractors. Novasep may utilize Subcontractors with appropriate expertise and experience in the
performance of its obligations under this Agreement; provided, however, that Inspire must give its written approval in each instance prior to the use of Subcontractors by Novasep and may require Subcontractors to agree to conditions consistent with
those contained herein. Nothing in this Section 10.8 shall relieve Novasep from any obligation under this Agreement. 

10.9 Amendment. This Agreement, including any Schedule hereto, may not be amended or modified in any manner except
by an instrument in writing signed by a duly authorized representative of each Party. 
 10.10
Severability. If and to the extent that any court of competent jurisdiction holds any provision (or any part thereof) of this Agreement to be invalid or unenforceable, such holding shall in no way affect the validity or enforceability of the
remainder of this Agreement, and the invalid or unenforceable provision shall be fully severed from this Agreement and there shall automatically be added in lieu thereof a provision as similar in terms and intent to such severed provision as may be
legal, valid and enforceable. 
 10.11 Waiver. Any failure of a Party to comply with any obligation,
covenant, agreement or condition herein contained may be expressly waived, in writing only, by the other Party hereto and such waiver shall be effective only in the specific instance and for the specific purpose for which made or given. 

10.12 Survival. Articles I (to the extent required to enforce other surviving rights or obligations), V,
VII, VIII and X (other than Sections 10.4 and 10.8), and Sections 2.2, 3.1(c), 3.1(d), 3.5, 3.6, 3.7, 3.10, 3.11, 6.1, 6.2, 6.5 and 9.7, and any other provision which by its terms specifically shall so state, together with any obligations accrued
hereunder at the time of termination or expiration, shall survive the termination or expiration of this Agreement.  
  

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 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 10.13 Drafting Ambiguities. Each Party to this Agreement and its
counsel have reviewed and revised this Agreement. The rule of construction to the effect that any ambiguities are to be resolved against the drafting Party shall not be employed in the interpretation of this Agreement or any amendment or Schedules
hereto. 
 10.14 Headings; Schedules and Exhibits; Counterparts. 

(a) Headings. The headings of the Sections of this Agreement are for reference purposes only, are
not part of this Agreement and shall not in any way affect the meaning or interpretation of this Agreement. 

(b) Schedules. All Schedules delivered pursuant to this Agreement shall be deemed part of this
Agreement and incorporated herein by reference, as if fully set forth herein. In the event that any Schedule conflicts with any of the terms or provisions of this Agreement, the terms and provisions of this Agreement shall prevail. 

(c) Counterparts. This Agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original but all of which together shall constitute one and the same instrument. Facsimile signatures shall be treated as original signatures. 

10.15 Governing Law. This Agreement and all matters arising out of or relating to this Agreement shall be
governed, construed and enforced in accordance with the laws of the State of New York, USA, without regard to principles of conflicts of law, and the Parties hereby irrevocably consent to the exclusive jurisdiction of the state and federal courts of
the State of New York, USA. Each of the Parties hereby waives and agrees not to assert in any such dispute, to the fullest extent permitted by Legal Requirements, any claim that (i) such Party is not personally subject to the jurisdiction of
such courts, (ii) such Party and such Party’s property is immune from any legal process issued by such courts or (iii) any litigation or other proceeding commenced in such courts is brought in an inconvenient forum. 

10.16 Remedies. Except as expressly set forth in this Agreement, none of the remedies set forth in this Agreement
are intended to be exclusive, and each Party shall have available to it all remedies available under law or in equity or in any other agreement between the Parties. 

10.17 Injunctive Relief. In the event that either Novasep or Inspire breaches or threatens to breach any provision
of Article VI or Article VII of this Agreement or Novasep fails to meet any time schedule in the Project Plan (except where such failure was a direct result of Inspire’s failure to comply with this Agreement or the Project Plan), the Parties
agree that irreparable harm to the other Party should be presumed and the damages to such Party would probably be very difficult to ascertain and would be inadequate. Accordingly, in the event of such circumstances, each of Novasep and Inspire agree
that, in addition to any other right and remedies available at law or in 
  

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
equity, the other Party shall have the right to obtain injunctive relief from any court of competent jurisdiction. 

10.18 Further Assurances. Each Party agrees to execute, acknowledge and deliver such further instruments, and to
do all such other acts, as may be necessary or appropriate in order to carry out the purposes and intent of this Agreement. 

10.19 Counterparts. This Agreement may be executed in two counterparts and by facsimile or PDF signature, each of
which shall be deemed an original and which together shall constitute one instrument. 
 10.20 English
Language. The English language version of this Agreement will be controlling on the Parties. All information, documents, reports, records, notices and communications to be provided by one Party to the other Party hereunder will be provided in
the English language. 
 [Remainder of page intentionally left blank.] 

 

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 [Signature Page to Technical Transfer & Development Services Agreement] 

 IN WITNESS WHEREOF, each of the Parties hereto has caused this Agreement to be duly executed as of the date
first written above. 
  

			
	 Inspire Pharmaceuticals, Inc.

		
	 By:
	 	                 /s/ Adrian
Adams

	 Name:
	 	 Adrian Adams

	 Title:
	 	 President and Chief Executive Officer

	
	 Finorga S.A.S.

		
	 By:
	 	                 /s/ Yves
Michon

	 Name:
	 	 Yves Michon

	 Title:
	 	 President and Chief Executive Officer

  

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 SCHEDULE A 

PROJECT PLAN 
 Novasep will
conduct the work as defined below. The work includes the performance by Novasep of the following services: 
 1. Description of the
work 
 Phase I : “ Laboratory Familiarization - Process Improvement Program and Piloting of the Selected Process”

 Phase I started early [c.i.]. 

The Phase I work consists-of Phase IA and Phase IB which will be completed by a pilot batch using the selected process: 

1.1. Phase IA - Laboratory Familiarization: 
  

	 	 (i)
	 reproducing INSPIRE’s Process in Novasep’s laboratories 

	 	 (ii)
	 assessment of INSPIRE’s Process critical parameters and 

	 	 (iii)
	 transferring INSPIRE’s analytical methods. 

During the laboratory familiarization phase, Novasep will repeat the process transmitted by Inspire to reproduce the results
described in the technical package provided by Inspire. On successful completion, and if Inspire is satisfied by the process as it is, Novasep will then identify or re-assess the Process Parameter Acceptable Ranges to adapt the given process for
up-scaling. During Phase IA, the analytical methods will be transferred and they will be validated on Inspire’s request. 

Novasep’s personnel may visit INSPIRE’s site(s), from time to time, to facilitate experience and know-how sharing between
INSPIRE and Novasep. INSPIRE’s personnel are also prepared to visit Novasep’s site(s), from time to time, to facilitate the acquisition of and share experience and know-how between INSPIRE and Novasep. Phase I will include laboratory
familiarization with the INSPIRE Process as well as laboratory development work (including analytical activities) to allow scale-up of INSPIRE’s Process during Phase II. Phase IA will be completed by end of [c.i.] 

1.2. Phase IB - Process Improvement Program: 

NOVASEP has investigated from early [c.i.] to beginning of [c.i.] new ideas to improve the current INSPIRE’s Process; this
investigation for process improvement concerned essentially the purification steps. Phase IB was completed early [c.i.] and resulted in no major new finding. 

1.3 Kilo-scale Batch: 

Inspire asked Novasep to run a kilolab batch to test the process at a small scale and to generate enough material for
crystallization studies and to test the ultrafiltration step. This kilolab batch was started in [c.i.] and completed in [c.i.]. 
  

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 1.4. Pilot: 

Phase I will be concluded with the piloting at [c.i.] batch size the INSPIRE Process or the improved INSPIRE Process to secure
up-scaling during Phase II. The material produced during this piloting will not be cGMP material. 
 During Phase I,
Novasep will, with the prior review and approval of INSPIRE, identify and purchase the equipment that Novasep does not already own or have access to and which is necessary to perform Phase I. 

1.5 Safety Tests: 

Once the development team confirms the safety test required to safely scale-up this process, the project team will then decide to
pursue specific trials (RC1, DSC, etc.) if needed. Some of those trials might need to be outsourced (ARC). In the course of Phase I if any safety issue is identified and if sub-contracted additional activities are needed, the associated costs will
be charged accordingly to Inspire. Before any commitment with a third party, Novasep will discuss and obtain Inspire’s approval. 

Phase II: Specific Equipment Design/Installation and Qualification – Development batches - Proof of Process and production of
validation batches  
 Phase II will be performed at industrial scale (up to 6000L reactors and adequate isolation equipments
including filter dryers). The necessary separation columns and other purification equipment will be specifically designed to fit to Inspire’s project. During Phase II, Novasep will design, install and qualify the specific Denufosol equipment
(Phase IIa) and perform a Proof of Process batch to test the up-scaling at real batch size followed by the three validation batches (Phase IIb). 

Phase II will be divided into Phase IIa and Phase IIb described hereafter: 

Phase IIa: specific equipment design/installation and qualification 

The purification columns and chromatography will be designed specifically for and dedicated to Inspire’s project and dedicated to Denufosol
for Phases II and Phase III. During Phase IIa, the workshop which will be used for production will be prepared and the specific equipment will be installed and qualified for use in Phase IIb. Phase IIa will be completed by end-[c.i.]. 

Pre-Phase IIb: Development batches 

This phase consists in manufacturing four development batches during the period covering [c.i.] to end [c.i.] to generate enough data to be used in
the NDA. Batch size of these industrial batches would be defined between Inspire and Novasep’s teams in order to reach the targeted quality level. 

Phase IIb: Proof of Process and production of validation batches 

Phase IIb will be performed at [c.i.] batch size at 50% of the anticipated future industrial scale. An optional [c.i.] proof of process (POP) batch
will be produced followed by three [c.i.] process validation batches during this Phase IIb. Phase IIb will be realized during the period covering 

 

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indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 
[c.i.]. Validation protocols will be submitted for approval to Inspire prior to any validation activities. 

2. Time Schedule 
 The work
will start in [c.i.]. It shall be performed according to the following schedule : 
  

							
	 Phases
	  	 Objectives
	  	 Starting date
	  	 Finishing
date

	 Phase Ia + additional R&D
work
	  	 Lab Familiarization/Process and analytical transfer
	  	 [c.i.]
	  	 [c.i.]

	 Phase Ib
	  	 Process optimization
	  	 [c.i.]
	  	 [c.i.]

	 Kilolab batch
	  	 Generate stream
	  	 [c.i.]
	  	 [c.i.]

	 Piloting
	  	 Test the selected Process
	  	 [c.i.]
	  	 [c.i.]

	 Phase IIa
	  	 Design, Installation and Qualification of Equipment
	  	 [c.i.]
	  	 [c.i.]

	 Pre-Phase IIb
	  	 Development batches
	  	 [c.i.]
	  	 [c.i.]

	 Phase IIb
	  	 Proof of Process batch (optional) + Process validation
	  	 [c.i.]
	  	 [c.i.]

3. Documentation 
 Novasep
will provide the following documentation to Inspire for its review: 
  

	 	 •
	 	 Master Batch Record 

	 	 •
	 	 Methods for IPC and release testing 

	 	 •
	 	 Executed batch records 

	 	 •
	 	 Deviation/change control documents 

	 	 •
	 	 Campaign reports containing main information from the executed batch records including deviations and investigations 

	 	 •
	 	 Certificate of analysis 

	 	 •
	 	 Development reports 

 Note:
Inspire and Novasep will work closely to optimize document issues and reviews in order to respect the project timelines. 
 4. Supplies
by INSPIRE to Novasep 
 INSPIRE agrees to supply Novasep on a reasonably prompt basis with the following tangible materials
(the “INSPIRE Materials”): 

	 	 •
	 	 dCMP and UMP-2Na 

	 	 •
	 	 Denufosol tetrasodium 

	 	 •
	 	 Samples of intermediate process streams taken from the current manufacturing process 

	 	 •
	 	 Samples of resins used in the manufacturing process 

	 	 •
	 	 Analytical standards 

  

 - 34 - 

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

	 	 •
	 	 Samples of individual raw material, starting material, and process impurities 

	 	 •
	 	 Spare HPLC column needed to run analytical method M1152 

	 	 •
	 	 Other materials needed to advance technology transfer, process development, and manufacturing activities at the Recipient. 

The INSPIRE Materials will be supplied to Novasep in sufficient quantity and sufficiently in advance in order to allow Novasep to perform the work
in accordance with the terms of the Agreement. 
 Novasep agrees to use the INSPIRE Materials solely for the work and in accordance with
the terms and conditions of the Agreement. 
  

 - 35 - 

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 SCHEDULE B 

PROJECT FEES 
 INSPIRE shall
pay Novasep the following fees for the performance of the work described in the Project Plan. 
 Novasep shall invoice INSPIRE as follows:

 Service Fees, Invoices, Payments for Phase I: 

 

									
	PHASE I	  	Objectives/Deliverables	  	Total 
price
(€)	  	Payments	  	Invoicing date
	 Phase Ia

 
 Laboratory

Familiarization
  
	  	 - Process familiarization, development & scale up

 
 - Lab sample
deliveries

- Development
report
	  	 [c.i.]
	  	 [c.i.]
	  	 [c.i.]

	Additional R&D
work	  	 - Analytical transfer &

Process development
	  	 	  	 	  	 
	 	 	 	 	 
	Phase 1b	  	  

Process Improvement
  
	  	 [c.i.]
	  	 [c.i.]
	  	 [c.i.]

	 	 	 	 	 
	Pilot batch	  	  

Scale-up
  
	  	 [c.i.]
	  	 [c.i.]
	  	 [c.i.]

	 	 	 	 	 
	Kilolab batch	  	  

Generate stream
  
	  	 [c.i.]
	  	 [c.i.]
	  	 [c.i.]

	 	 
	Total Cost Phase I	  	751,000

 

 - 36 - 

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 Equipment costs, Service Fees, Invoices, Payments for Phase II : 

 

									
	 PHASE II
	  	Objectives/Deliverables	  	 Total
Price

(€)
	  	Price
(€)	  	Invoicing date
	
Phase IIa
	  	 	  	 [c.i.]
	  	 [c.i.]
	  	 [c.i.]

	
Workshop modifications 
	  	 Workshop engineering and modification

	  	 	  	 	  	 
	  

Equipment cost
  
	  	  

Skid design & Skid procurement
  
	  	 [c.i.]
	  	 [c.i.]
	  	 [c.i.]

	 Pre-Phase
IIb
 Manufacturing of four Development batches

 
	  	Production of Denufosol	  	 [c.i.]
	  	 [c.i.]
	  	 [c.i.]

	  

Phase IIb
 Manufacturing

& Validation costs
  
	  	  

Production of Denufosol
	  	 [c.i.]
	  	 [c.i.]
	  	 [c.i.]

	  

TOTAL PHASE II
  
	  	4,350,000 or 4,150,000 (excluding optional POP
batch)

  

 - 37 - 

 Note: Certain portions of this document have been marked “[c.i.]” to
indicate that confidential treatment has been requested for this confidential information. The confidential portions have been omitted and filed separately with the Securities and Exchange Commission. 

 

 SCHEDULE C 

EQUIPMENT 
 [c.i.]

  

 - 38 -Executive Employment Agreement

 EXHIBIT 10.4 

EXECUTIVE EMPLOYMENT AGREEMENT 

This EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is made as of April 2, 2010, by and between
Inspire Pharmaceuticals, Inc. (together with its successors and assigns, “Inspire” or the “Company”), and Andrew I. Koven (“Executive”). 

R E C I T A L S 

WHEREAS, the Company desires to employ Executive and Executive desires to be employed by the Company as the
Company’s Executive Vice President and Chief Administrative and Legal Officer. 
 NOW, THEREFORE, in
consideration of the foregoing recitals, the mutual covenants and conditions herein, and other good and valuable consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereby agree as follows: 

A G R E E M E N T 

1. Employment and Term. The Company hereby agrees to employ Executive and Executive hereby accepts employment by
the Company on the terms and conditions hereinafter set forth. Executive’s term of employment by the Company under this Agreement (the “Term”) shall commence on May 10, 2010 or such earlier date as the parties may agree
(the “Effective Date”) and continue through December 31, 2014; provided, however, that the Term shall thereafter be automatically extended for unlimited additional one-year periods unless, at least six months
prior to the then-scheduled date of expiration of the Term, either (x) the Company gives notice to Executive that it is electing not to so extend the Term or (y) Executive gives notice to the Company that he is electing not to so extend
the Term. Notwithstanding the foregoing, the Term may be earlier terminated in strict accordance with the provisions of Section 5 below, in which event Executive’s employment with the Company shall expire in accordance therewith.

 2. Position, Duties and Responsibilities; Location. 

2.1 Position and Duties. Executive shall be employed as Executive Vice President and Chief Administrative and
Legal Officer of the Company. Executive shall have, subject to the general direction of the Chief Executive Officer of the Company (the “CEO”), general overall authority and responsibility for the day-to-day management of the legal and
administrative functions of the Company. Executive shall also have such other duties, powers and authority as are commensurate with his position as Executive Vice President and Chief Administrative and Legal Officer of a biopharmaceutical company
focused on researching, developing and commercializing prescription pharmaceutical products, including such other duties and responsibilities as are reasonably delegated to him from time to time by the CEO. The Executive shall report to the CEO of
the Company. 

 2.2 Exclusive Services and Efforts. Executive agrees to devote his
efforts, energies, and skill to the discharge of the duties and responsibilities attributable to his position and, except as set forth herein, agrees to devote substantially all of his professional time and attention exclusively to the business and
affairs of the Company. It is expressly understood and agreed that, during the Term, Executive will not be employed by, render services to, or represent, any other person, firm or company engaged in a business of a similar nature or in competition
with the Company without the prior written consent of the Company, except that, for a period of one year following the Effective Date, Executive may consult with his current employer in a reasonable manner on matters relating to
transition of his responsibilities, litigation or proceedings related to his work period with that employer, or other similar matters. Executive also agrees that he shall not take personal advantage of any business opportunities which arise during
his employment and which in his good faith judgment may benefit the Company and are within the scope of the Company’s then business or natural extension thereof without the consent of the Company, provided that the foregoing does
not apply to future employment opportunities. Notwithstanding the foregoing, Executive shall be entitled to engage in (a) with the consent of the Board (which consent shall not be unreasonably withheld) service on the board of directors of a
for-profit company, business or trade organization, provided, that, the Executive shall provide the Company prior written notice of his intention to join any such board and provided further that he shall not serve on the
board of any entity that directly and materially competes with the Company, (b) service on the board of directors of not-for-profit organizations, (c) other charitable activities and community affairs and (d) manages his personal and
family investments and affairs, in each case to the extent such activities do not either individually or in the aggregate, materially interfere with the performance of his duties and responsibilities to the Company. 

2.3 Compliance with Company Policies. To the extent not inconsistent with the terms and conditions of this
Agreement and with due regard for his position, Executive shall be subject to the Bylaws, policies, practices, procedures and rules of the Company, including those policies and procedures explained in the Company’s Employee Handbook, but in no
event shall anything in such documents expand the definition of a “Cause” termination hereunder. Notwithstanding the foregoing, the Board shall amend the Bylaws as soon as practicable following the execution of this Agreement so that
roles, responsibilities, authority, and reporting lines of the Executive Vice President and Chief Administrative and Legal Officer as described therein are consistent with the terms of this Agreement. 

2.4 Location. Executive’s principal office, and principal place of employment, shall be at the
Company’s offices in Durham, North Carolina, but it is understood that Executive will commute on a weekly basis and sporadically at other times to the Company office from his home in New Jersey. The Company will provide an allowance of $3,750
per 
  

 2 

 
month for each month during the Term to cover housing costs and at the same time period an additional payment such that after the payment of all taxes on the allowance and the additional payment
Executive retains the amount of the allowance. The Company will also reimburse the Executive for the cost of commuting (but in no event greater than the cost of first-class commercial airfare) and at the same time period provide an additional
payment such that after the payment of all taxes on the commuting expenses and the additional payment Executive retains the amount of the commuting expenses. During the Term, the Company will also provide up to $65,000 to be applied to the cost of a
leased automobile and cover all reasonable costs related thereto. The actual value of the leased automobile may exceed $65,000 provided that Executive pays for any cost associated with the leased automobile in excess of $65,000. In addition, the
Executive shall have the right to purchase the leased automobile upon expiration of the lease term, provided that the entity leasing the automobile makes it available for purchase at the expiration of such lease. On or before March 15 of each
year during the Term (including the first March 15 following the year in which the Term ends), the Company shall pay to the Executive an additional payment such that after the payment of all taxes on the taxable portion of the automobile
perquisite and the additional payment Executive retains the amount of the taxable portion of automobile perquisite. 

3. Compensation. 

3.1 Base Salary. During the Term, the Company hereby agrees to pay to Executive an annualized base salary of Four
Hundred Twenty Five Thousand Dollars ($425,000) (the “Salary”), subject to all applicable federal, state and local income and employment taxes and other required or elected withholdings and deductions, payable in equal installments
on the Company’s regularly-scheduled paydays as it is earned. Executive’s Salary will be reviewed at least annually by the Board following the first anniversary date of the Effective Date and may be adjusted upward (in which case such
increased amount shall be the “Salary” hereunder) or remain the same (but in no event shall the Salary be reduced) in consideration of (a) Executive’s performance, (b) peer company compensation reviews by the Compensation
Committee of the Board (the “Compensation Committee”), (c) the Company’s financial performance, (d) the general economic environment and (e) such other factors as the Board or the Compensation Committee may deem
relevant. 
 3.2 Cash Bonuses. 

(a) Annual Cash Bonus. For each calendar year that ends during the Term, Executive shall be entitled to receive
an annual cash incentive award (the “Annual Cash Bonus”) equal to 60% of Salary for performance at target levels. For each such year, the Board shall, after consultation with Executive and good faith consideration of the budget and
goals developed by management (x) determine the financial and other goals to be used to measure 
  

 3 

 
Executive’s performance for such year, (y) establish the threshold and maximum performance levels for the goals for purposes of determining the amount of the Annual Cash Bonus for such
year and (z) advise Executive of such goals and levels in writing prior to March 31 of such year. Within sixty (60) days after the end of each such calendar year, the Board shall consult with Executive to determine and approve
Executive’s Annual Cash Bonus for such calendar year. Subject to any valid deferral election by Executive, the Annual Cash Bonus shall be paid in a cash lump sum as soon as reasonably practicable following the Board’s approval thereof, but
in no event later than March 15 of the following calendar year. In no event shall Executive’s Annual Cash Bonus payable in 2011 with respect to 2010 be less than $255,000. 

(b) Discretionary Cash Bonuses. The Board may, at any time or from time-to-time, grant Executive additional cash
bonuses in amounts to be determined by the Board should it, in its sole discretion, deem the same appropriate in light of Executive’s performance and the Company’s financial performance (each, a “Discretionary Cash
Bonus”); provided, however, that the failure of the Board to award any such bonus shall not give rise to any claim against the Company. The timing of the payment of any Discretionary Cash Bonus shall be determined in the
Board’s sole discretion; however, in no event will any Discretionary Cash Bonus be paid later than March 15 following the year in which it vests. 

3.3 Equity Compensation. 

(a) Annual Equity Award. Executive will be eligible for annual grants of long-term incentive and equity
compensation awards at the Board’s good faith discretion, based upon the Compensation Committee’s evaluation of his performance and peer company compensation practices. 

(b) Discretionary Equity Award. The Board may, at any time or from time-to-time, grant Executive additional
equity or equity-based awards in forms and amounts to be determined by the Board should it, in its sole discretion, deem the same appropriate in light of Executive’s performance and the Company’s financial performance (each, a
“Discretionary Equity Award”); provided, however, that the failure of the Board to grant any such award shall not give rise to any claim against the Company. 

3.4 Sign-On Awards. Sign-On Awards. The Company shall grant to Executive an award of 500,000 Restricted
Stock Units (the “Sign-On RSUs”) and options to purchase 200,000 shares of Common Stock (the “Sign-On Options” and, together with the Sign-On RSUs, the “Sign-On Awards”). 

(a) Sign-On Options. The Sign-On Options shall be granted on the Effective Date. Subject to the terms of this
Agreement and the Sign-On Options award agreement into which Executive and the Company shall enter evidencing the grant of the Sign-

 

 4 

 
On Options, 25% of the shares of Common Stock subject to the Sign-On Options shall become vested and non-forfeitable on the Effective Date (the “Initial Vested Sign-On Portion”).
However, notwithstanding the preceding sentence, the Initial Vested Sign-On Portion shall not be exercisable prior to the date on which the shares underlying the Sign-On Options are registered on Form S-8. In addition, 2.0833% of the shares of
Common Stock subject to the Sign-On Options shall vest and become exercisable on the first day of each of the first thirty-six (36) calendar months that begins after the first anniversary of the Effective Date. 

(b) Sign-on RSUs. The Sign-On RSUs shall be granted as soon as practicable following execution of this Agreement
but in no event prior to the date on which the shares underlying such awards are registered on Form S-8. Subject to the terms of this Agreement and the Sign-On RSUs award agreement into which Executive and the Company shall enter evidencing the
grant of the Sign-On RSUs, 50% of the Sign-On RSUs shall become vested and non-forfeitable, on the grant date of the Sign-On RSUs. In addition, 1.38889% of the shares of the Sign-On RSU shall vest and become non-forfeitable on the first day of each
of the first thirty-six (36) calendar months that begins after the first anniversary of the Effective Date. 

3.5 Registration of Common Stock; Equitable Adjustment. The Company shall register a sufficient number of shares
of Common Stock on a Form S-8 to satisfy its obligations under this Agreement as soon as practicable following the execution of this Agreement and in any event prior to the issuing of the Sign-On RSUs. The Company shall also accompany the S-8s with
reoffer prospectuses and shall use reasonable best efforts to maintain the effectiveness of the form S-8s and reoffer prospectuses. Within ten (10) days following each vesting date of a Restricted Stock Unit or date of exercise of an Option (as
applicable) described in this Agreement, a number of shares of Common Stock equal to the number of Restricted Stock Units that have vested, and the number of shares of Common Stock with respect to which an Option has been exercised, shall be
transferred to Executive’s personal brokerage account and such shares shall be validly issued, fully paid, non-assessable and freely tradable. The Company shall issue the shares pursuant to the NASDAQ inducement grant exception and shall comply
with the terms thereof. 
 4. Employee Benefits. 

4.1 Participation in Benefit Plans. During the Term, Executive shall be entitled to participate in such health,
group insurance, welfare, pension, and other employee benefit plans, programs and arrangements as are made generally available from time to time to senior executives of the Company (which shall include customary health, life insurance and disability
plans), such participation in each case to be on terms and conditions no less favorable to Executive than to other senior executives of the Company generally. In the event that Executive elects to decline coverage under any or all of the
aforementioned benefit plans, programs or arrangements, then he shall be permitted to receive cash in lieu of such coverage to 

 

 5 

 
the maximum extent permissible under the applicable plan document and applicable law. In lieu of participation in the health plan (if Executive so elects), the Company shall reimburse him for
premiums for participation in his prior employer’s health plan upon presentation of evidence of payment of premiums with regard therewith. 

4.2 Fringe Benefits, Perquisites and Vacations. During his employment by the Company, Executive shall be entitled
to participate in all fringe benefits and perquisites made available to other senior executives of the Company, such participation to be at levels, and on terms and conditions, that are commensurate with his position and responsibilities at the
Company and that are no less favorable than those applying to other senior executives of the Company. In addition, Executive shall be entitled to 25 days’ paid vacation per calendar year (which, if not used, may be carried over from year to
year). 
 4.3 Reimbursement of Expenses. The Company shall reimburse Executive for all reasonable
business and travel expenses (including first class airplane travel) incurred in the performance of his job duties and the promotion of the Company’s business, promptly upon presentation of appropriate supporting documentation and otherwise in
accordance with the expense reimbursement policy of the Company. 
 4.4 Attorneys’ Fees. The
Company shall pay promptly upon presentation of appropriate supporting documentation, for all reasonable attorneys’ fees incurred by Executive in connection with the negotiation and execution of this Agreement and to the extent taxable, an
additional amount such that the Executive has no after tax cost for such fees and the additional payment. 
 5.
Termination. 
 5.1 General. The Company may terminate Executive’s employment for any reason
or no reason, and Executive may terminate his employment for any reason or no reason, in either case subject only to the terms of this Agreement. In the event of the termination of Executive’s employment hereunder for any reason, he shall
promptly resign from any position he then holds that is affiliated with the Company or that he was holding at the Company’s request. For purposes of this Agreement, the following terms have the following meanings: 

(a) “Accrued Obligations” shall mean: (i) Executive’s earned but unpaid Salary through the
Termination Date; (ii) payment of any annual, long-term, or other incentive award earned in respect to any period ending on or before the Termination Date, or payable (but not yet paid) on or before the Termination Date; (iii) a lump-sum
payment in respect of accrued but unused vacation days at Executive’s per-business-day Salary rate in effect 
  

 6 

 
as of the Termination Date; and (iv) any unpaid expense or other reimbursements due pursuant to Sections 2.4 or 4.3 hereof or otherwise. 

(b) “Cause” shall mean (i) Executive is convicted of, or pleads guilty or nolo contendere
to, a felony or a crime involving moral turpitude; (ii) in carrying out his duties hereunder, Executive engages in conduct that constitutes willful gross misconduct, or willful gross neglect and that, in either case, results in material
economic or reputational harm to the Company; or (iii) Executive refuses to perform, or repeatedly fails to undertake good faith efforts to perform, the duties or responsibilities reasonably assigned to him (consistent with Section 2) by
the Board, in either case after written notice thereof. 
 (c) “Change in Control” shall mean
the first to occur of any of the following, provided that for any distribution that is subject to Section 409A (as defined in Section 8.2), a Change in Control under this Agreement shall be deemed to occur only if such event also satisfies
the requirements under Treas. Regs. Section 1.409A-(i)(5): 
 (i) the determination by a vote of a
majority of the members of the Board (which may be made effective as of a particular date), that a Change in Control has occurred, or is about to occur; 

(ii) any Person or group of Persons becomes the beneficial owner, directly or indirectly, of securities of the Company
representing more than fifty percent (50%) of the combined voting power of the Company’s then outstanding securities (a “Majority of the Securities”); 

(iii) (A) the stockholders of the Company approve a plan of complete liquidation of the Company; (B) the sale or
disposition of all or substantially all of the Company’s assets; or (C) a merger, consolidation or reorganization of the Company with or involving any other entity, other than (i) a merger, consolidation or reorganization that
would result in the voting securities of Inspire outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least a Majority of the
Securities of Inspire (or such surviving entity) outstanding immediately after such merger, consolidation or reorganization owned in approximately the same proportion of such ownership by each of the prior shareholders as prior to the transaction;
or (ii) a merger, consolidation or reorganization that would result in the voting securities of Inspire outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities
of the surviving entity) at least a Majority of the Securities of Inspire (or such surviving entity) outstanding immediately after such merger, consolidation or reorganization owned in approximately the same proportion of such ownership by each of
the prior shareholders as prior to the transaction except for the fact 
  

 7 

 
that one of the shareholders owning more than 5% of the Company’s outstanding Common Stock as of the effective date of this Agreement increases its percentage of ownership by no more than
20% and to no greater than 49.99% immediately after the merger, consolidation or reorganization and the percentage ownership of the other shareholders are reduced proportionally; or 

(iv) the date a majority of the members of the Board are replaced during any 12-month period by directors whose
appointment or election are not endorsed by a majority of the members of the Board before the date of the appointment or election. 

Notwithstanding the foregoing, in no event shall a restructuring, reorganization, merger or other change in
capitalization in which the Persons who own an interest in the Company on the date hereof (the “Current Owners”) (or any individual or entity which receives from a Current Owner an interest in the Company through will or the laws of
descent and distribution) maintain more than a fifty-percent (50%) interest in the resultant entity owned in approximately the same proportion of such ownership by each of the Current Owners as before the transaction, be deemed a Change in
Control. 
 (d) “Company Arrangement” shall mean any plan, program, agreement, corporate
governance document or arrangement of the Company or any of its affiliates; 
 (e)
“Disability” shall mean that Executive has been unable, with or without reasonable accommodation and due to physical or mental incapacity, to substantially perform his duties and responsibilities hereunder for 180 consecutive days;
and 
 (f) “Good Reason” shall mean the occurrence of any of the following events without
either (x) Executive’s express prior written consent or (y) full cure within 30 days after Executive gives written notice to the Company requesting cure, such notice to be given by Executive no later than 90 days after the date he
first learns that the event has occurred: (i) a change in Executive’s authority, duties, responsibilities or reporting lines; (ii) the Company ceases to have any class of common equity securities required to be registered under
section 12 of the Securities Exchange Act of 1934; (iii) a reduction in the Executive’s base salary; (iv) any relocation of Executive’s principal office, or principal place of employment, to a location that is more than 50 miles
from Durham, North Carolina; (v) any other action or inaction that constitutes a material breach of this Agreement by the Company; or (vi) a Change of Control has occurred and the individual to whom Executive reports has ceased to be
Adrian Adams prior thereto or at any time thereafter. No event shall constitute grounds for a Good Reason 
  

 8 

 
termination unless Executive terminates his employment hereunder within one year after such event occurs. 

(g) “Pro Rata Annual Cash Bonus” shall mean an amount equal to (i) the Annual Cash Bonus that
Executive would have been entitled to receive for the calendar year during which his employment hereunder terminated if his employment hereunder had continued (such amount to be determined with any subjective or personal performance goals rated at
no less than target), multiplied by (ii) a fraction, the numerator of which is the number of days he was employed hereunder during such year and the denominator of which is the number of days in such year; and 

(h) “Termination Date” shall mean the date on which Executive’s employment hereunder terminates in
accordance with this Agreement (which, in the case of a notice of non-renewal of the Term in accordance with Section 1 hereof, shall mean the date on which the Term expires). 

5.2 Termination by the Company Without Cause or by Executive With Good Reason. In the event that Executive’s
employment is terminated by the Company without Cause or by the Executive for Good Reason, the Term shall expire on the Termination Date and Executive shall be entitled to: 

(a) a single sum cash amount, payable on the
60th day following his Termination Date, in an amount
equal to (i) two times (ii) the sum of (1) his Salary as in effect immediately prior to the Termination Date and (2) the average Annual Cash Bonus that Executive received for each of the three preceding calendar years, provided,
however, that if Executive is not employed for a sufficient time to have received three Annual Cash Bonuses, such calculation will assume that a target Annual Cash Bonus (or if the termination takes place in 2010, then $255,000, which is the minimum
bonus payment in the case of a termination in 2010), was paid in each missing year and, provided further, that if Executive is terminated during the first six months of the Company’s fiscal year, then the prior year’s Annual Cash Bonus
shall be disregarded if less than the average of the other two preceding years; 
 (b) a Pro-Rata Annual Cash
Bonus, such amount to be paid in a cash lump sum to Executive on the date his Annual Cash Bonus for the year of termination would have been paid if his employment hereunder had continued; 

(c) an immediate 100% vesting of the Sign-On Awards and an additional twenty-four months of vesting, exercisability and
non-forfeitability service credited, as of the Termination Date, for any other outstanding equity or equity-based award, including but not limited to any outstanding Annual Equity Award or Discretionary Equity Award (with vested

  

 9 

 
stock options remaining exercisable throughout the period ending on the first to occur of (A) the second anniversary of the Executive’s Termination Date; or (B) the end of their
maximum stated term); 
 (d) the Accrued Obligations; and 

(e) a single sum cash amount (payable to Executive on the sixtieth
(60th) day following the Termination Date subject to
the six-month delay provided under Section 8.2, as applicable) equal to the cost of continuation of health and dental benefits under the Employer’s health plan to which Executive is entitled as of the Termination Date for a period of 24
months, and to the extent permissible under applicable law and under any insurance policy insuring the Employer’s health plan (if any), continued coverage under the Employer’s health plan with the full cost payable by the Executive for a
period of 24 months commencing on the first day of the month following the Termination Date. 
 5.3 Death
and Disability. Executive’s employment shall terminate in the event of his death, and either Executive or the Company may terminate Executive’s employment in the event of his Disability (provided that no termination of Executive’s
employment hereunder for Disability shall be effective unless the party terminating Executive’s employment first gives at least 15 days’ written notice of such termination to the other party). In the event that Executive’s employment
hereunder is terminated due to his death or Disability, the Term shall expire on the Termination Date and he and/or his estate or beneficiaries (as the case may be) shall be entitled to the benefits described in Section 5.2(b), (c) and
(d). 
 5.4 Termination by the Company For Cause or by Executive Without Good Reason. In the event that
Executive’s employment hereunder is terminated by Executive without Good Reason or by the Company for Cause, the Term shall expire as of the Termination Date and Executive shall be entitled to the Accrued Obligations. 

5.5 Expiration of the Term. Executive or the Company may elect not to renew or extend the Term in accordance with
Section 1 above, in which case the Termination Date shall be the date the Term expires. In the event of such a termination, Executive shall be entitled to the Accrued Obligations and on any termination of employment upon or after such
expiration the Sign-On Award shall remain exercisable for the lesser of two years or the remainder of the initial term of such Sign-On Award. 

5.6 Due to Change in Control. In the event that (x) within two years following a Change in Control Executive
terminates his employment hereunder with Good Reason or the Company takes an action within the six-month time period specified in the flush language below in anticipation of a Change in Control that actually occurs within six months

  

 10 

 
thereafter and the Executive terminates his employment for Good Reason as a result thereof or (y) within two years following a Change in Control, or in anticipation of a Change in Control
that actually occurs within six months thereafter, the Company terminates Executive’s employment hereunder without Cause, then, in lieu of the payments otherwise due to Executive under Section 5.2 above, the Term shall expire on the
Termination Date and Executive shall be entitled to (subject to the last paragraph of this Section 5.6): 

(a) an amount equal to (i) three (3) times (ii) the sum of (A) Executive’s Salary as in effect
immediately prior to the Termination Date (or, if greater, immediately prior to any event constituting Good Reason) and (B) the highest Annual Cash Bonus paid or payable to him in respect of any of the three completed years immediately prior to
his Termination Date (or if the termination takes place in 2010, then $255,000, which is the minimum bonus payment in the case of a termination in 2010) such payment to be made in a cash lump sum to Executive on the sixtieth
(60th) day following the Termination Date (subject to
the six-month delay provided under Section 8.2, as applicable); 
 (b) a Pro-Rata Annual Cash Bonus
determined for this purpose by reference to Executive’s target Annual Cash Bonus then in effect, such payment to be made in a cash lump sum to Executive no later than thirty (30) days following the Termination Date; 

(c) full vesting, exercisability and non-forfeitability, as applicable, as of the Termination Date, of any outstanding
equity or equity-based awards, including but not limited to any outstanding Annual Equity Award, Discretionary Equity Award or Sign-On Awards; 

(d) the Accrued Obligations; and 

(e) a single sum cash amount (payable to Executive on the sixtieth
(60th) day following the Termination Date subject to
the six-month delay provided under Section 8.2, as applicable) equal to the cost of continuation of health and dental benefits under the Employer’s health plan to which Executive is entitled as of the Termination Date for a period of 36
months, and to the extent permissible under law and under any insurance policy insuring the Employer’s health plan (if any), continued coverage under the Employer’s health plan with the full cost payable by the Executive for a period of 36
months commencing on the first day of the month following the Termination Date. 
 Notwithstanding the
foregoing, in the event Executive is terminated in anticipation of a Change in Control or terminates for Good Reason as a result of a Company action in anticipation of a Change in Control then (i) if a Change in Control actually occurs within
six-months thereafter, the Executive shall continue to receive the amount due under 
  

 11 

 
Section 5.2 and granted therein and any additional amounts above such amount due in accordance with this Section 5.6 shall be payable upon the later of the Change in Control and on the
sixtieth (60th) day after the termination of
employment (subject to the six-month delay provided under Section 8.2, as applicable); and (ii) any outstanding equity or equity-based awards, including but not limited to any outstanding Annual Equity Award, Discretionary Equity Award or
Sign-On Award that are not otherwise vested (or will not otherwise vest) in accordance with Section 5.2 of this Agreement shall not terminate before the six-month anniversary of the Executive’s termination of employment and, if a Change in
Control actually occurs before such date, shall become fully vested and exercisable, as applicable in accordance with Section 5.6(c). 

5.7 Release. Executive’s entitlement to the payments described in this Section 5 is expressly
contingent upon Executive first providing the Company with a signed mutual release in substantially the form attached hereto as Exhibit A (the “Release”). In order to be effective, such Release must be (a) delivered by
Executive to the Company no later than forty-five (45) days following the Termination Date and (b) counter-signed and returned by the Company to Executive within 10 days following the Company’s receipt thereof; provided,
however, that if the Executive delivers the Release to the Company on a timely bases and the Company does not return a counter-signed Release during the applicable time period allowed, such Release of the Executive shall be null and void and
the payments hereunder shall cease to be contingent on the Release and this Section 5.7. 
 6. Excess
Parachute Payments. Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that any payment, award, benefit or distribution (or any acceleration of any payment, award, benefit or distribution) by the
Company to or for the benefit of Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise) would be subject to the excise tax imposed by Section 4999 of the Code or any interest or
penalties are incurred by Executive with respect to the excise tax, then Exhibit B attached hereto shall apply. 

7. Indemnification. 

7.1 If Executive is made a party, is threatened to be made a party, or reasonably anticipates being made a party, to any
Proceeding by reason of the fact that Executive is or was a director, officer, shareholder, employee, agent, trustee, consultant or representative of the Company or any of its affiliates or is or was serving at the request of the Company or any of
its affiliates, or in connection with his service hereunder as a director, officer, shareholder, employee, agent, trustee, consultant or representative of another Person, or if any Claim is made, is threatened to be made, or is reasonably
anticipated to be made, that arises out of or relates to Executive’s service in any of the foregoing capacities, then Executive shall promptly be indemnified and held harmless to the fullest extent permitted or authorized by any Company

  

 12 

 
Arrangement, or if greater, by applicable law, against any and all costs, expenses, liabilities and losses (including, without limitation, advancement and payment of attorneys’ and other
professional fees and charges, judgments, interest, expenses of investigation, penalties, fines, ERISA excise taxes or penalties and amounts paid or to be paid in settlement, with such legal fees advanced to the maximum extent permitted by law)
incurred or suffered by him in connection therewith or in connection with seeking to enforce his rights under this Section 7.1, and such indemnification shall continue even if Executive has ceased to be a director, officer, shareholder,
employee, agent, trustee, consultant or representative of the Company or other Person and shall inure to the benefit of his heirs, executors and administrators. 

7.2 A directors’ and officers’ liability insurance policy (or policies) shall be kept in place, during the
Term and thereafter until the sixth anniversary of the Termination Date, providing coverage to Executive that is no less favorable to him in any respect than the coverage then being provided to any other current or former director or officer of the
Company. 
 7.3 For purposes of this Agreement, the following terms shall have the following meanings:
“Affiliate” of a Person shall mean any Person that directly or indirectly controls, is controlled by, or is under common control with, such Person; “Claim” shall mean any claim, demand, request, investigation,
dispute, controversy, threat, discovery request, or request for testimony or information; “Person” shall mean any individual, corporation, partnership, limited liability company, joint venture, trust, estate, board, committee,
agency, body, employee benefit plan, or other person or entity; and “Proceeding” shall mean any threatened or actual action, suit or proceeding, whether civil, criminal, administrative, investigative, appellate, formal, informal or
other. 
 8. Other Tax Matters. 

8.1 The Company shall withhold all applicable federal, state and local taxes, social security and workers’
compensation contributions and other amounts as may be required by law with respect to compensation payable to Executive pursuant to this Agreement. 

8.2 Notwithstanding anything herein to the contrary, this Agreement is intended to be interpreted and applied so that
the payment of the benefits set forth herein either shall either be exempt from the requirements of Section 409A of the Code (“Section 409A”) or shall comply with the requirements of such provision. Notwithstanding any provision of
this Agreement to the contrary, if Executive is a “specified employee” within the meaning of Section 409A, any payments or arrangements due upon a termination of Executive’s employment under any arrangement that constitutes a
“nonqualified deferral of compensation” within the meaning of Section 409A and which do not otherwise qualify under the exemptions under Treas. Regs. Section 1.409A-1 (including without limitation, the short-term deferral
exemption or the 
  

 13 

 
permitted payments under Treas. Regs. Section 1.409A-1(b)(9)(iii)(A)), shall be delayed and paid or provided on the earlier of (i) the date which is six months after Executive’s
“separation from service” (as such term is defined in Section 409A and the regulations and other published guidance thereunder) for any reason other than death, and (ii) the date of Executive’s death. The Company
acknowledges and agrees that if any payment, award, benefit or distribution (or any acceleration of any payment, award, benefit or distribution) made or provided to Executive or for Executive’s benefit in connection with this Agreement, or
Executive’s employment with the Company or the termination thereof (the “Payments”) are determined to be subject to the additional taxes, interest or penalties imposed by Section 409A, or any interest or penalties with
respect to such additional taxes, interest or penalties (such additional taxes, together with any such interest and penalties, are referred to collectively as the “Section 409A Tax”), then the Executive will be entitled to receive
an additional payment (an “409A Gross-Up Payment”) from the Company such that the net amount the Executive retains after paying any applicable Section 409A Tax and any federal, state or local income or FICA taxes on such 409A
Gross-Up Payment, shall be equal to the amount the Executive would have received if the Section 409A Tax were not applicable to the Payments. All determinations of the Section 409A Tax and 409A Gross-Up Payment, if any, will be made by tax
counsel or other tax advisers designated by Executive and approved by the Company, which approval won’t be unreasonably withheld or delayed. For purposes of determining the amount of the 409A Gross-Up Payment, if any, Executive will be deemed
to pay federal income tax at the actual marginal rate of federal income taxation in the calendar year in which the total Payments are made and state and local income taxes at the actual marginal rate of taxation in the state and locality of
Executive’s residence on the date the total Payments are made, net of the maximum reduction in federal income taxes that could be obtained from deduction of such state and local taxes. If the Section 409A Tax is determined by the Internal
Revenue Service, on audit or otherwise, to exceed the amount taken into account hereunder in calculating the 409A Gross-Up Payment (including by reason of any payment the existence or amount of which cannot be determined at the time of the 409A
Gross-Up Payment), the Company shall make another 409A Gross-Up Payment in respect of such excess (plus any interest, penalties or additions payable by Executive with respect to such excess). The Company and Executive shall each reasonably cooperate
with the other in connection with any administrative or judicial proceedings concerning the existence or amount of liability for Section 409A Tax with respect to the total Payments. The 409A Gross-Up Payments provided to Executive shall be made
no later than the tenth (10th) business day following the last date the Payments are made but in all events within the time period specified in Section 8.5 also. 

8.3 After any Termination Date, Executive shall have no duties or responsibilities that are inconsistent with having a
“separation from service” within the meaning of Section 409A as of the Termination Date and, notwithstanding anything in the Agreement to 

 

 14 

 
the contrary, distributions upon termination of employment of nonqualified deferred compensation may only be made upon a “separation from service” as determined under Section 409A
and such date shall be the Termination Date for purposes of this Agreement. Each payment under this Agreement or otherwise shall be treated as a separate payment for purposes of Section 409A. In no event may Executive, directly or indirectly,
designate the calendar year of any payment to be made under this Agreement which constitutes a “nonqualified deferral of compensation” within the meaning of Section 409A and to the extent an amount is payable within a time period, the
time during which such amount is paid shall be in the discretion of the Company. 
 8.4 Any amounts otherwise
payable to Executive following a termination of employment that are not so paid by reason of this Section 8 shall be paid as soon as practicable following, and in any event within thirty (30) days following, the date that is six months
after Executive’s separation from service (or, if earlier, the date of Executive’s death) together with interest on the delayed payment at the Company’s cost of borrowing. All reimbursements and in-kind benefits provided under this
Agreement shall be made or provided in accordance with the requirements of Section 409A. 
 8.5 To the
extent that any reimbursements pursuant to Section 4 or otherwise are taxable to Executive, any reimbursement payment due to Executive pursuant to such Section shall be paid to Executive on or before the last day of the Executive’s taxable
year following the taxable year in which the related expense was incurred. The reimbursements pursuant to Section 4 or otherwise are not subject to liquidation or exchange for another benefit and the amount of such reimbursements that Executive
receives in one taxable year shall not affect the amount of such reimbursements that Executive receives in any other taxable year. Any tax gross-up shall be made no later than the end of the calendar year next following the calendar year in which
the Executive remits the related tax. 
 9. Confidentiality, Invention Assignment and Non-Competition
Agreement. Executive agrees to be bound by the terms of the Employee Confidentiality, Invention Assignment and Non-Compete Agreement, a copy of which is attached hereto as Exhibit C and incorporated herein by reference (the
“Non-Compete Agreement”). Except as expressly set forth in this Agreement and the Non-Compete Agreement, Executive shall be subject to no contractual or similar restrictions on his right to terminate his employment hereunder or on
his activities after the Termination Date. 
 10. Non-Disparagement. During and after the Term, Executive
and the Company agree not to make any statement that criticizes, ridicules, disparages, or is otherwise derogatory of the other; provided, however, that nothing in this Agreement shall restrict either party from making truthful statements
(a) when required by law, subpoena, court order or the like; (b) when 
  

 15 

 
requested by a governmental, regulatory, or similar body or entity; (c) in confidence to a professional advisor for the purpose of securing professional advice; (d) in the course of
performing his duties during the Term; (e) from rebutting any statement made or written about them; or (f) from making normal competitive statements about the Company’s business or products. This provision shall not apply after three
(3) years from the date of termination of Executives employment with the Company. 
 11. Notices.
Except as otherwise specifically provided herein, any notice, consent, demand or other communication to be given under or in connection with this Agreement shall be in writing and shall be deemed duly given when delivered personally, when
transmitted by facsimile transmission, one (1) day after being deposited with Federal Express or other nationally recognized overnight delivery service or three (3) days after being mailed by first class mail, charges or postage prepaid,
properly addressed, if to the Company, at its principal office, and, if to Executive, at his address set forth following his signature below. Either party may change such address from time to time by notice to the other. 

12. Governing Law. This Agreement shall be governed by and construed and interpreted in accordance with the laws
of the State of North Carolina, exclusive of any choice of law rules. 
 13. Arbitration; Legal Fees.

 (a) Any dispute or controversy arising under or in connection with this Agreement (except with respect to
injunctive relief under Section 9) shall be settled exclusively by arbitration in North Carolina, in accordance with the rules of the American Arbitration Association for employment disputes as then in effect. Judgment may be entered on the
arbitrator’s award in any court having jurisdiction. 
 (b) In the event of any material contest or
dispute relating to this Agreement or the termination of Executive’s employment hereunder, each of the parties shall bear its own costs and expenses, except that the Company agrees to promptly reimburse Executive for his costs and expenses
(including reasonable attorneys’ fees and expenses) incurred by Executive in connection with such contest or dispute in the event Executive prevails, as determined by the arbitrator if in arbitration, by the court if pursuant to Section 9,
or as a separate arbitration if otherwise. The amount shall be paid within thirty (30) days of the award of the arbitration or court, which shall also specify the amount due. 

14. Amendments; Waivers. This Agreement may not be modified or amended or terminated except by an instrument in
writing, signed by Executive and a duly-authorized officer of the Company (other than Executive). By an instrument in writing similarly executed, either 

 

 16 

 
party may waive compliance by the other party with any provision of this Agreement that such other party was or is obligated to comply with or perform; provided, however, that such
waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure. No failure to exercise and no delay in exercising any right, remedy, or power hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, or power hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, or power provided herein or by law or in equity. To be effective, any written waiver must
specifically refer to the condition(s) or provision(s) of this Agreement being waived. 
 15.
Inconsistencies. In the event of any inconsistency between any provision of this Agreement and any provision of any Company arrangement, the provisions of this Agreement shall control, unless Executive and the Company otherwise agree in a
writing that expressly refers to the provision of this Agreement that is being waived. 
 16. Assignment.
Except as otherwise specifically provided herein, neither party shall assign or transfer this Agreement nor any rights hereunder without the consent of the other party, and any attempted or purported assignment without such consent shall be void;
provided, however, that any assignment or transfer pursuant to a merger or consolidation, or the sale or liquidation of all or substantially all of the business and assets of the Company shall be valid, so long as the assignee or
transferee (a) is the successor to all or substantially all of the business and assets of the Company and (b) assumes the liabilities, obligations and duties of the Company, as contained in this Agreement, either contractually or as a
matter of law. Executive’s consent shall not be required for any such transaction. This Agreement shall otherwise bind and inure to the benefit of the parties hereto and their respective successors, penalties, assigns, heirs, legatees,
devisees, executors, administrators and legal representatives. 
 17. Voluntary Execution;
Representations. Executive acknowledges that (a) he has consulted with or has had the opportunity to consult with independent counsel of his own choosing concerning this Agreement and has been advised to do so by the Company and (b) he
has read and understands this Agreement, is competent and of sound mind to execute this Agreement, is fully aware of the legal effect of this Agreement, and has entered into it freely based on his own judgment and without duress. Executive
represents and covenants that his employment hereunder and compliance with the terms and conditions hereof will not conflict with or result in the breach by him of any agreement to which he is a party or by which he may be bound and in connection
with his employment with the Company he will not engage in any unauthorized use of any confidential or proprietary information he may have obtained in connection with his employment with any other employer. The Company represents and warrants that
it is fully authorized, by any person or body whose authorization is required, to enter into this Agreement and to perform its obligations under it. 
  

 17 

 18. Headings. The headings of the Sections and sub-sections contained
in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any provision of this Agreement. 

19. Beneficiaries/References. Executive shall be entitled, to the extent permitted under applicable law, to select
and change a beneficiary or beneficiaries to receive any compensation or benefit hereunder following Executive’s death by giving written notice thereof. In the event of Executive’s death or a judicial determination of his incompetence,
references in this Agreement to Executive shall be deemed, where appropriate, to refer to his beneficiary, estate or other legal representative. 

20. Survivorship. Except as otherwise set forth in this Agreement, the respective rights and obligations of the
parties shall survive any termination of Executive’s employment. 
 21. Severability. Whenever
possible, each provision or portion of any provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law but the invalidity or unenforceability of any provision or portion of any provision of this
Agreement in any jurisdiction shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability of this Agreement, including that provision or portion of any provision, in any
other jurisdiction. 
 22. No Mitigation/No Offset. Executive shall be under no obligation to seek other
employment or to otherwise mitigate the obligations of the Company under this Agreement, and there shall be no offset against amounts or benefits due to Executive under this Agreement or otherwise on account of any claim (other than any preexisting
debts then due in accordance with their terms) the Company may have against him or any remuneration or other benefit earned or received by Executive after such termination. 

23. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an
original, but all such counterparts shall together constitute one and the same instrument. Signatures delivered by facsimile or PDF shall be effective for all purposes. 

24. Entire Agreement. This Agreement and the agreements described in the attached Exhibits contain the entire
agreement of the parties and supersedes all prior or contemporaneous negotiations, correspondence, understandings and agreements between the parties, regarding the subject matter of this Agreement. 

[Signature Page to Follow] 
  

 18 

 IN WITNESS WHEREOF, this Agreement has been duly executed by or on behalf of
the parties hereto as of the date first above written. 
  

			
	 INSPIRE PHARMACEUTICALS, INC.:

		
	 By:
	 	 /s/ Adrian Adams

			
	 Name:
	 	 Adrian Adams

			
	 Title:
	 	 President and Chief Executive Officer

 

	
	 EXECUTIVE:

	
	 /s/ Andrew I. Koven

	 Name: Andrew I. Koven

	 Address: 10 Beechcroft Rd.

	                 Short Hills, N.J. 07078

 

 19 

 Exhibit A 

FORM OF GENERAL RELEASE OF ALL CLAIMS 

THIS GENERAL RELEASE OF ALL CLAIMS (this “General Release”), dated as of
[____________________________], 2010, is made by and between Andrew I. Koven (the “Executive”) and Inspire Pharmaceuticals, Inc. (the “Company”). 

WHEREAS, the Company and Executive are parties to that certain Employment Agreement, dated as of April 2, 2010
(the “Employment Agreement”); 
 WHEREAS, Executive’s employment with the Company has
been terminated and Executive is entitled to receive severance and other benefits, as set forth in Section 5 of the Employment Agreement subject to the execution of this General Release; 

WHEREAS, in consideration for Executive’s signing of this General Release, the Company will provide Executive with
such severance and benefits pursuant to the Employment Agreement; and 
 WHEREAS, except as otherwise expressly
set forth herein, the parties hereto intend that this General Release shall effect a full satisfaction and release of the obligations described herein owed to Executive by the Company and to the Company by Executive. 

NOW, THEREFORE, in consideration of the premises, the mutual covenants of the parties hereinafter set forth and other
good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby covenant and agree as follows: 

1. Executive, for himself, Executive’s spouse, heirs, administrators, children, representatives, executors, successors, assigns, and
all other individuals and entities claiming through Executive, if any (collectively, the “Executive Releasers”), does hereby release, waive, and forever discharge the Company and each of its respective agents, subsidiaries,
parents, affiliates, related organizations, employees, officers, directors, attorneys, successors, and assigns in their capacities as such (collectively, the “Employer Releasees”) from, and does fully waive any obligations of
Employer Releasees to Executive Releasers for, any and all liability, actions, charges, causes of action, demands, damages, or claims for relief, remuneration, sums of money, accounts or expenses (including attorneys’ fees and costs) of
any kind whatsoever, whether known or unknown or contingent or absolute, which heretofore has been or which hereafter may be suffered or sustained, directly or indirectly, by Executive Releasers in consequence of, arising out of, or in any way
relating to: (a) Executive’s employment with the Company; (b) the termination of Executive’s employment with the Company; (c) the Employment Agreement; or (d) any events occurring on or prior to the date of this General
Release. The foregoing release 
  

 20 

 
and discharge, waiver and covenant not to sue includes, but is not limited to, all waivable claims and any obligations or causes of action arising from such claims, under common law including
wrongful or retaliatory discharge, breach of contract (including but not limited to any claims under the Employment Agreement other than claims for unpaid severance benefits, bonus or Base Salary earned thereunder) and any action arising
in tort including libel, slander, defamation or intentional infliction of emotional distress, and claims under any federal, state or local statute including the Age Discrimination in Employment Act (“ADEA”), Title VII of the
Civil Rights Act of 1964, the Civil Rights Act of 1866 and 1871 (42 U.S.C. § 1981), the National Labor Relations Act, the Fair Labor Standards Act, the Employee Retirement Income Security Act, the Americans with Disabilities Act of
1990, the Rehabilitation Act of 1973, or the discrimination or employment laws of any state or municipality, and/or any claims under any express or implied contract which Executive Releasers may claim existed with Employer Releasees. This also
includes a release of any claims for wrongful discharge and all claims for alleged physical or personal injury, emotional distress relating to or arising out of Executive’s employment with the Company or any of its subsidiaries or affiliates or
the termination of that employment; and any claims under the WARN Act or any similar law, which requires, among other things, that advance notice be given of certain work force reductions. Notwithstanding anything contained in this
Section 1 above to the contrary, nothing contained in herein shall constitute a release by any Executive Releaser of any of his, her or its rights or remedies available to him, her or it, at law or in equity, related to, on account of,
in connection with or in any way pertaining to the enforcement of: (i) any right to indemnification, advancement of legal fees or directors and officers liability insurance coverage existing under the constituent documents of the Company
or applicable state corporate, limited liability company and partnership statutes or pursuant to any agreement, plan or arrangement; (ii) any rights to the receipt of employee benefits which vested on or prior to the date of this General
Release; (iii) the right to receive severance and other benefits under the Employment Agreement; (iv) the right to continuation coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act; (v) any rights of
Executive under the Employment Agreement with respect to (A) the gross-up protections set forth in Sections 6 and 8.2 of the Employment Agreement, (B) amounts due upon a Change in Control occurring after a termination of employment that
occurs in anticipation of a Change in Control as set forth in Section 5.6, and (C) any equity rights; or (vi) this General Release or any of its terms or conditions. 

2. Excluded from this General Release and waiver are any claims which cannot be waived by applicable law, including but not limited to
the right to participate in an investigation conducted by certain government agencies. Executive does, however, waive Executive’s right to any monetary recovery should any government agency (such as the Equal Employment Opportunity
Commission) pursue any claims on Executive’s behalf. Executive represents and warrants that Executive has not filed any complaint, charge, or lawsuit against the Employer Releasees with any government agency or any court. 

3. Executive agrees never to seek personal recovery from any Employer Releasee in any forum for any claim covered by the above waiver and
release language, except that Executive 
  

 21 

 
may bring a claim under the ADEA to challenge this General Release. If Executive violates this General Release by suing an Employer Releasee (excluding any claim by Executive under the ADEA or as
otherwise set forth in Section 1 hereof), then Executive shall be liable to the Employer Releasee so sued for such Employer Releasee’s reasonable attorneys’ fees and other litigation costs incurred in defending against such a
suit. Nothing in this General Release is intended to reflect any party’s belief that Executive’s waiver of claims under ADEA is invalid or unenforceable, it being the intent of the parties that such claims are waived. 

4. Each party agrees that neither this General Release, nor the furnishing of the consideration for this General Release, shall be deemed
or construed at any time to be an admission by any party of any improper or unlawful conduct. 
 5. Each party acknowledges and
recites that he or it has: 
 (a) executed this General Release knowingly and voluntarily; 

(b) had a reasonable opportunity to consider this General Release; 

(c) read and understands this General Release in its entirety; 

(d) been advised and directed orally and in writing (and this subparagraph (d) constitutes such written
direction) to seek legal counsel and any other advice such party wishes with respect to the terms of this General Release before executing it; and 

(e) relied solely on such party’s own judgment, belief and knowledge, and such advice as such party may have
received from such party’s legal counsel. 
 6. Section 13 of the Employment Agreement, which shall survive the
expiration of the Employment Agreement for this purpose, shall apply to any dispute with regard to this release. 
 7. Executive
acknowledges and agrees that (a) his execution of this General Release has not been forced by any employee or agent of the Company, and Executive has had an opportunity to negotiate the terms of this General Release and (b) he has been
offered twenty-one (21) calendar days after receipt of this General Release to consider its terms before executing
it.1 Executive shall have seven (7) calendar days
from the date he executes this General Release to revoke his or her waiver of any ADEA claims by providing written notice of the revocation to the Company, as provided in Section 11 of the Employment Agreement. 

8. Capitalized terms used but not defined in this General Release have the meanings ascribed to such terms in the Employment Agreement.

  
  

1
     In the event the Company determines that Employee’s termination constitutes “an exit incentive or other employment termination program offered to a
group or class of employees” under the ADEA, the Company will provide Employee with: (1) 45 days to consider the General Release; and (2) the disclosure schedules required for an effective release under the ADEA. 

 

 22 

 9. This General Release may be executed by the parties in one or more counterparts, each of
which shall be an original and all of which shall together constitute one and the same instrument. Each counterpart may be delivered by facsimile transmission or e-mail (as a .pdf, .tif or similar un-editable attachment), which
transmission shall be deemed delivery of an originally executed counterpart hereof. 
 IN WITNESS WHEREOF, the
parties hereto have executed this General Release as of the day and year first above written. 
  

			
	 INSPIRE PHARMACEUTICALS, INC.:

		
	 By:
	 	 

			
	 Name:
	 	 Adrian Adams

			
	 Title: President and Chief Executive Officer

  

 

	
	 EXECUTIVE:

	
	  
	 Name: Andrew I. Koven

	 Address:

  

 23 

 Exhibit B 

PARACHUTE TAX INDEMNITY PROVISIONS 

This Exhibit B sets forth the terms and provisions applicable to the Executive pursuant to the provisions of Section 6 of the
Agreement. This Exhibit B shall be subject in all respects to the terms and conditions of the Agreement. Capitalized terms used without definition in this Exhibit B shall have the meanings set forth in the Agreement. 

(A) In the event that Executive shall become entitled to payments and/or benefits provided by this Agreement or any other amounts in the
“nature of compensation” (whether pursuant to the terms of this Agreement or any other plan, arrangement or agreement with the Company, or any arrangement or agreement with any person whose actions result in a change of ownership or
effective control or a change in the ownership of a substantial portion of the assets of the corporation covered by Code Section 280G(b)(2) (a “280G Change of Control”) or any person affiliated with the Company or such person) as a
result of a 280G Change of Control (collectively the “Company Payments”), and such Company Payments will be subject to the tax (the “Excise Tax”) imposed by Code Section 4999 (and any similar tax that may hereafter be
imposed by any taxing authority), the Company shall pay to Executive at the time specified below (i) an additional amount (the “Gross-Up Payment”) such that the net amount retained by Executive, after deduction of any Excise Tax on
the Company Payments and any U.S. federal, state, and for local income or payroll tax upon the Gross-up Payment provided for by this paragraph, but before deduction for any U.S. federal, state, and local income or payroll tax on the Company
Payments, shall be equal to the Company Payments and (ii) an amount equal to the product of any deductions disallowed for federal, state or local income tax purposes because of the inclusion of the Gross-Up Payment in Executive’s adjusted
gross income multiplied by Executive’s actual marginal rate of federal, state or local income taxation, respectively, for the calendar year in which the Gross-Up Payment is to be made. 

(B) In the event that the Internal Revenue Service or court ultimately makes a determination that the excess parachute payments plus the
base amount is an amount other than as determined initially, an appropriate adjustment shall be made with regard to the Gross-Up Payment as applicable to reflect the final determination. 

(C) For purposes of determining whether any of the Company Payments and Gross-Up Payments (collectively the “Total Payments”)
will be subject to the Excise Tax and the amount of such Excise Tax, (i) the Total Payments shall be treated as “parachute payments” within the meaning of Code Section 280G(b)(2), and all “parachute payments” in excess
of the “base amount” (as defined under Code Section 280G(b)(3)) shall be treated as subject to the Excise Tax, unless and except to the extent that, in the opinion of the Company’s independent certified public accountants
appointed prior to any change in ownership (as defined under Code Section 280G(b)(2)) or tax counsel selected by such accountants or the Company (the “Accountants”) such Total Payments (in whole or in part) either do not constitute
“parachute payments,” including giving effect to the recalculation of stock options in accordance with Treasury 
  

 24 

 
Regulation Section 1.280G-1, Q&A 33, represent reasonable compensation for services actually rendered within the meaning of Code Section 280G(b)(4) in excess of the “base
amount” or are otherwise not subject to the Excise Tax, and (ii) the value of any non-cash benefits or any deferred payment or benefit shall be determined by the Accountants in accordance with the principles of Code Section 280G. To
the extent permitted under Revenue Procedure 2003-68, the value determination shall be recalculated to the extent it would be beneficial to Executive. In the event that the Accountants are serving as accountant or auditor for the individual, entity
or group effecting the Change in Control, Executive may appoint with the approval of the Company, which approval shall not be unreasonable or unreasonably delayed, another nationally recognized accounting firm to make the determinations hereunder
(which accounting firm shall then be referred to as the “Accountants” hereunder). All determinations hereunder shall be made by the Accountants which shall provide detailed supporting calculations both to the Company and Executive at such
time as it is requested by the Company or Executive supported by such opinions or other confirmations as will let the Company and the Executive rely therein for purposes of filing their tax returns. The determination of the Accountants shall be
final and binding upon the Company and Executive. 
 (D) For purposes of determining the amount of the Gross-Up Payment,
Executive’s actual U.S. federal income tax rate in the calendar year in which the Gross-Up Payment is to be made and state and local income taxes at Executive’s actual rate of taxation in the state and locality of Executive’s
residence for the calendar year in which the Company Payment is to be made, net of the maximum reduction in U.S. federal income taxes which could be obtained from deduction of such state and local taxes if paid in such year, shall be used. In the
event that the Excise Tax is subsequently determined by the Accountants to be less than the amount taken into account hereunder at the time the Gross-Up Payment is made, Executive shall repay to the Company, at the time that the amount of such
reduction in Excise Tax is finally determined, the portion of the prior Gross-Up Payment attributable to such reduction (plus the portion of the Gross-Up Payment attributable to the Excise Tax and U.S. federal, state and local income tax imposed on
the portion of the Gross-up Payment being repaid by Executive if such repayment results in a reduction in Excise Tax or a U.S. federal, state and local income tax deduction), plus interest on the amount of such repayment at the rate provided in Code
Section 1274(b)(2)(B). Notwithstanding the foregoing, in the event any portion of the Gross-Up Payment to be refunded to the Company has been paid to any U.S. federal, state and local tax authority, repayment thereof (and related amounts) shall
not be required until actual refund or credit of such portion has been made to Executive, and interest payable to the Company shall not exceed the interest received or credited to Executive by such tax authority for the period it held such portion.
Executive and the Company shall mutually agree upon the course of action to be pursued (and the method of allocating the expense thereof) if Executive’s claim for refund or credit is denied. 

(E) In the event that the Excise Tax is later determined by the Accountant or the Internal Revenue Service to exceed the amount taken
into account hereunder at the time the Gross-Up Payment is made (including by reason of any payment the existence or amount of which cannot be determined at the time of the Gross-Up Payment), the Company shall make an additional

  

 25 

 
Gross-Up Payment in respect of such excess (plus any interest or penalties payable with respect to such excess) at the time that the amount of such excess is finally determined. 

(F) The Gross-up Payment or portion thereof provided for above shall be paid not later than the sixtieth (60) day following a 280G
Change of Control which subjects Executive to the Excise Tax; provided, however, that if the amount of such Gross-up Payment or portion thereof cannot be finally determined on or before such day, the Company shall pay to Executive on such day an
estimate, as determined in good faith by the Accountant, of the minimum amount of such payments and shall pay the remainder of such payments, as soon as the amount thereof can reasonably be determined, but in no event later than the ninetieth
(90th) day after the occurrence of the event subjecting Executive to the Excise Tax. Notwithstanding any other provision of this Agreement, all Gross-Up Payments under this Exhibit B shall be paid pursuant to Section 8 of the Agreement. In
the event that the amount of the estimated payments exceeds the amount subsequently determined to have been due, subject to Paragraph (G) below, such excess shall constitute a loan by the Company to Executive, payable on the fifth
(5th) day after demand by the Company (together with interest at the rate provided in Code Section 1274(b)(2)(B)). 

(G) In the event of any controversy with the Internal Revenue Service (or other taxing authority) with regard to the Excise Tax,
Executive shall permit the Company to control issues related to the Excise Tax (at its expense), but Executive shall control any other issues unrelated to the Excise Tax. In the event that the issues are interrelated, Executive and the Company shall
in good faith cooperate. In the event of any conference with any taxing authority as to the Excise Tax or associated income taxes, Executive shall permit the representative of the Company to accompany Executive, and Executive and his representative
shall cooperate with the Company and its representative. 
 (G) The Company shall be responsible for all charges of the
Accountant. 
 (I) The Company and Executive shall promptly deliver to each other copies of any written communications, and
summaries of any verbal communications, with any taxing authority regarding the Excise Tax covered by this provision. 
 (G)
Nothing in this Exhibit B is intended to violate the Sarbanes-Oxley Act and to the extent that any advance or repayment obligation hereunder would do so, such obligation shall be modified so as to make the advance a nonrefundable payment to
Executive and the repayment obligation null and void. 
  

 26 

 Exhibit C 

EMPLOYEE CONFIDENTIALITY, INVENTION ASSIGNMENT 

AND NON-COMPETE AGREEMENT 

THIS EMPLOYEE CONFIDENTIALITY, INVENTION ASSIGNMENT AND NON-COMPETE AGREEMENT (“Agreement”) is made as
of the date set forth on the signature page below between Inspire Pharmaceuticals, Inc. (“Inspire”), and the person whose name is set forth on the signature page below as Employee (“Employee”). 

In consideration of Employee’s employment or continued employment by Inspire, with the intention that this Agreement
shall apply to the entire period of Employee’s employment with Inspire (including the period prior to the date of this Agreement), Employee hereby agrees as follows: 

1. CONFIDENTIAL INFORMATION DEFINED. “Confidential Information” means trade secrets, proprietary information and
materials, and confidential knowledge and information which includes, but is not limited to, matters of a technical nature (such as discoveries, ideas, concepts, designs, drawings, specifications, techniques, models, diagrams, test data, scientific
methods and know-how, and materials such as reagents, substances, chemical compounds, subcellular constituents, cell or cell lines, organisms and progeny, and mutants, derivatives or replications derived from or relating to any of the foregoing
materials), and matters of a business nature (such as the identity of customers and prospective customers, the nature of work being done for or discussed with customers or prospective customers, suppliers, marketing techniques and materials,
marketing and development plans, pricing or pricing policies, financial information, plans for further development, and any other information of a similar nature not available to the public). 

“Confidential Information” shall not include information that: (a) was in Employee’s possession or in
the public domain before receipt from the Company, as evidenced by the then existing publication or other public dissemination of such information in written or other documentary form; (b) becomes available to the public through no fault of
Employee; (c) is received in good faith by Employee from a third party who is known to the Employee to be not subject to an obligation of confidentiality to the Company or any other party; or (d) is required by a judicial or administrative
authority or court having competent jurisdiction to be disclosed by Employee, provided that Employee shall promptly notify the Company and not attempt to prevent the Company from opposing or limiting such order. 

2. NON-DISCLOSURE OF CONFIDENTIAL INFORMATION OF INSPIRE. Employee acknowledges that, during the period of Employee’s
employment with Inspire, Employee has had or will have access to Confidential Information of Inspire. Therefore, Employee agrees that both during and after the period of Employee’s employment with Inspire, Employee shall not, without the prior
written approval of Inspire, directly or indirectly (a) reveal, report, publish, 
  

 27 

 
disclose or transfer any Confidential Information of Inspire to any person or entity, or (b) use any Confidential Information of Inspire for any purpose or for the benefit of any person or
entity, except in the good faith performance of Employee’s work for Inspire. 
 3. NON-DISCLOSURE OF CONFIDENTIAL
INFORMATION OF OTHERS. Employee acknowledges that, during the period of Employee’s employment with Inspire, Employee may have had or will have access to Confidential Information of third parties who have given Inspire the right to use such
Confidential Information, subject to a non-disclosure agreement between Inspire and such third party. Therefore, Employee agrees that both during and after the period of Employee’s employment with Inspire, Employee shall not, without the prior
written approval of Inspire, directly or indirectly (a) reveal, report, publish, disclose or transfer any Confidential Information of such third parties to any person or entity, or (b) use any Confidential Information of such third parties
for any purpose or for the benefit of any person or entity, except in the good faith performance of Employee’s work for Inspire or to comply with an order from any court of competent jurisdiction. 

4. PROPERTY OF INSPIRE. Employee acknowledges and agrees that all Confidential Information of Inspire and all reports, drawings,
blueprints, materials, data, code, notes and other documents and records (other than Employee’s personal address book), whether printed, typed, handwritten, videotaped, transmitted or transcribed on data files or on any other type of media, and
whether or not labeled or identified as confidential or proprietary, made or compiled by Employee, or made available to Employee, during the period of Employee’s employment with Inspire (including the period prior to the date of this Agreement)
concerning Inspire’s Confidential Information are and shall remain Inspire’s property and shall be delivered to Inspire within five (5) business days after the termination of such employment with Inspire or at any earlier time on
request of Inspire. Employee shall not retain copies of such Confidential Information, documents and records. 
 5.
PROPRIETARY NOTICES. Employee shall not, and shall not permit any other person to, remove any proprietary or other legends or restrictive notices contained in or included in any Confidential Information. 

6. INVENTIONS. 

(a) Employee shall promptly, from time to time, fully inform and disclose to Inspire in writing all inventions,
copyrightable material, designs, improvements and discoveries of any kind which Employee now has made, conceived or developed (including prior to the date of this Agreement), or which Employee may later make, conceive or develop, during the period
of Employee’s employment with Inspire, which pertain to or relate to Inspire’s business or any of the work or businesses carried on by Inspire (“Inventions”). This covenant applies to all such Inventions, whether or not they are
eligible for patent, copyright, trademark, trade secret or other legal protection; and whether or not they are conceived and/or developed by Employee alone or 

 

 28 

 
with others; and whether or not they are conceived and/or developed during regular working hours; and whether or not they are conceived and/or developed at Inspire’s facility or not.

 (b) Inventions shall not include any inventions made, conceived or developed by Employee prior to
Employee’s employment with Inspire, a complete list of which is set forth on Schedule A attached. 
 (c)
All Inventions shall be the sole and exclusive property of Inspire, and shall be deemed part of the Confidential Information of Inspire for purposes of this Agreement, whether or not fixed in a tangible medium of expression. Employee hereby assigns
all Employee’s rights in all Inventions and in all related patents, copyrights and trademarks, trade secrets and other proprietary rights therein to Inspire. Without limiting the foregoing, Employee agrees that any copyrightable material shall
be deemed to be “works made for hire” and that Inspire shall be deemed the author of such works under the United States Copyright Act, provided that in the event and to the extent such works are determined not to constitute “works
made for hire”, Employee hereby irrevocably assigns and transfers to Inspire all right, title and interest in such works. 

(d) Employee shall assist and cooperate with Inspire, both during and after the period of Employee’s employment with
Inspire, at Inspire’s sole expense, to allow Inspire to obtain, maintain and enforce patent, copyright, trademark, trade secret and other legal protection for the Inventions. Employee shall sign such truthful documents, and do such things
necessary, to obtain such protection and to vest Inspire with full and exclusive title in all Inventions against infringement by others. Employee hereby appoints the Secretary of Inspire as Employee’s attorney-in-fact to execute any truthful
documents on Employee’s behalf for this purpose. 
 (e) Employee shall not be entitled to any additional
compensation for any and all Inventions made during the period of Employee’s employment with Inspire. 
 7. COVENANT NOT
TO COMPETE. If Employee is, at any time during Employee’s period of employment with Inspire, employed in the discovery or development areas of the Company in a non-clerical position, or as a director level or higher level senior manager of
the Company, then this Section 7 shall apply. Employee and Inspire agree that the services rendered by the Employee are unique and irreplaceable, and that competitive use and knowledge of any Confidential Information would substantially and
irreparably injure Inspire’s business, prospects and good will. Employee and Inspire also agree that Inspire’s business is global in nature due to the type of products and/or services being provided. Therefore, Employee agrees that during
the period of Employee’s employment with Inspire and for a period of one (1) year thereafter, Employee shall not, directly or indirectly, through any other person, firm, corporation or other entity (whether as an officer, director,
employee, partner, consultant, holder of equity or debt investment, lender or in any other manner or capacity): 
  

 29 

 (a) develop, sell, market, offer to sell products and/or services anywhere
in the world that have the same or similar technological approach or technology platform (e.g., same receptors (such as P2Y), same mechanism of action (such as mucociliary clearance)) and have the same indication as those being developed, offered or
sold by Inspire on the date of the termination of Employee’s employment with Inspire for any reason, provided that the foregoing shall not be violated by Executive’s activities with an entity where the portion of the competitive business
involved is less than 5% of the revenues of the portion of the entity that is under the Employee’s supervision; 

(b) solicit, induce, encourage or attempt to induce or encourage any employee or consultant of Inspire to terminate his
or her employment or consulting relationship with Inspire, or to breach any other obligation to Inspire (other than advertising not specifically targeted at the Company’s employees and serving as a reference upon request), however,
notwithstanding the foregoing, Employee may engage in the activities described in this Section 7(b) with respect to one executive who worked with Employee in the past and joined the Company without it violating this provision; or 

(c) interfere with, disrupt, alter or attempt to disrupt or alter the relationship, contractual or otherwise, between
Inspire and any consultant, contractor, customer, potential customer, or supplier of Inspire. 
 Employee
acknowledges that the foregoing geographic, activity and time limitations contained in this Section 7 are reasonable and properly required for the adequate protection of Inspire’s business. In the event that any such geographic, activity
or time limitation is deemed to be unreasonable by a court, Employee shall submit to the reduction of either said activity or time limitation to such activity or period as the court shall deem reasonable. In the event that Employee is in violation
of the aforementioned restrictive covenants, then the time limitation thereof shall be extended for a period of time equal to the pendency of such proceedings, including appeals. 

8. DISCLOSURE OF THIS AGREEMENT. Employee hereby authorizes Inspire to notify others, including but not limited to customers of
Inspire and any of Employee’s future employers, of the terms of this Agreement and Employee’s responsibilities under this Agreement. 

9. SPECIFIC PERFORMANCE. Employee acknowledges that money damages alone would not adequately compensate Inspire in the event of a
breach or threatened breach by Employee of this Agreement, and that, in addition to all other remedies available to Inspire at law or in equity, Inspire shall be entitled to injunctive relief for the enforcement of its rights and to an accounting of
profits made during the period of such breach. 
 10. NO RIGHTS GRANTED. Employee understands that nothing in this
Agreement shall be deemed to constitute, by implication or otherwise, the grant by Inspire to the employee of any 
  

 30 

 
license or other right under any patent, patent application or other intellectual property right or interest belonging to Inspire. 

11. SEVERABILITY. 

(a) Each of the covenants provided in this Agreement are separate and independent covenants. If any provision of this
Agreement shall be determined to be invalid or unenforceable, the remainder of this Agreement shall not be affected thereby and any such invalid or unenforceable provision shall be reformed so as to be valid and enforceable to the fullest extent
permitted by law. 
 (b) It is not a defense to the enforcement of any provision of this Agreement that Inspire
has breached or failed to perform any obligation or covenant hereunder or under any other agreement or understanding between Employee and Inspire. 

12. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the laws of the State of North Carolina
without regard to conflict of law rules. All suits and claims shall be made only in state or federal courts located in North Carolina. 

13. SUPERSEDES OTHER AGREEMENTS. This Agreement contains the entire agreement of the parties with respect to subject matter hereof
and supersedes all previous agreements and understandings between the parties with respect to its subject matter. 
 14.
AMENDMENTS. This Agreement may not be changed, modified, released, discharged, abandoned or otherwise terminated in whole or in part except by an instrument in writing, agreed to and signed by the Employee and a duly authorized officer of
Inspire. 
 15. ACKNOWLEDGEMENTS. THE EMPLOYEE ACKNOWLEDGES THAT (i) THE EMPLOYEE HAS READ AND FULLY UNDERSTANDS THIS
AGREEMENT; (ii) THE EMPLOYEE HAS BEEN GIVEN THE OPPORTUNITY TO ASK QUESTIONS; (iii) THE EMPLOYEE HAS RECEIVED A COPY OF THIS AGREEMENT, THE ORIGINAL OF WHICH WILL BE RETAINED IN THE EMPLOYEE’S PERSONNEL FILE; AND (iv) THE
EMPLOYEE’S OBLIGATIONS UNDER THIS AGREEMENT SURVIVE THE TERMINATION OF THE EMPLOYEE’S EMPLOYMENT WITH INSPIRE FOR ANY REASON. 
  

 31 

 IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date set forth below. 
 INSPIRE PHARMACEUTICALS, INC. 

4222 Emperor Boulevard 

Durham, North Carolina 27703 

			
		
	 By:
	 	 Adrian Adams

		 	 President and Chief Executive Officer

		
		 	 /s/ Adrian Adams

		 	 (Signature Here)

		
	 Date:
	 	
April 
2nd, 2010

		 	
		 	
		
	 Employee:
	 	 Andrew I. Koven

		
		 	 /s/ Andrew I. Koven

		 	 (Signature Here)

		
	 Date:
	 	 April 2, 2010

		
	 Address:
	 	 10 Beechcroft Rd.

		
		 	 Short Hills, NJ 07078

		 	

  

 32

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