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Exhibit 10.26
INDEMNIFICATION AGREEMENT
This
Agreement is made as of April 15, 2006, between QuatRx
Pharmaceuticals
Company, a Delaware corporation (the "Company"), and
___________________ (the
"Indemnitee").
RECITALS
Both
the Company and Indemnitee recognize that highly competent
persons
have become more reluctant to serve publicly-held corporations as
directors or
in other capacities unless they are provided with adequate
protection through
insurance or adequate indemnification against inordinate risks of
claims and
actions against them arising out of their service to and activities
on behalf of
the corporation.
In
recognition of Indemnitee's need for substantial protection
against
personal liability in order to enhance Indemnitee's continued
service to the
Company in an effective manner and Indemnitee's reliance on the
provisions of
the Company's Certificate of Incorporation ("Certificate of
Incorporation") and
the Company's Bylaws (the "Bylaws") requiring indemnification of
the Indemnitee
to the fullest extent permitted by law, and in part to provide
Indemnitee with
specific contractual assurance that the protection promised by such
Certificate
of Incorporation and Bylaws will be available to Indemnitee
(regardless of,
among other things, any amendment to or revocation of such
Certificate of
Incorporation or Bylaws or any change in the composition of the
Company's Board
of Directors or acquisition transaction relating to the Company),
the Company
wishes to provide in this Agreement for the indemnification of and
the advancing
of expenses to Indemnitee to the fullest extent (whether partial or
complete)
permitted by law and as set forth in this Agreement.
The
Certificate of Incorporation, the Bylaws and the General
Corporation
Law of the State of Delaware ("DGCL") expressly provide that the
indemnification
provisions set forth therein are not exclusive and thereby
contemplate that
contracts may be entered into between the Company and members of
the board of
directors, officers and other persons with respect to
indemnification.
It
is reasonable, prudent and necessary for the Company contractually
to
obligate itself to indemnify, and to advance expenses on behalf of,
such persons
to the fullest extent permitted by applicable law so that they will
serve or
continue to serve the Company free from undue concern that they
will not be so
indemnified.
This
Agreement is a supplement to and in furtherance of the Certificate
of
Incorporation and Bylaws and any resolutions adopted pursuant
thereto and shall
not be deemed a substitute therefor, nor to diminish or abrogate
any rights of
Indemnitee thereunder.
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AGREEMENT
In
consideration of the premises and of Indemnitee agreeing to serve
or
continuing to serve the Company directly or, at its request, with
another
enterprise, and intending to be legally bound hereby, the parties
hereto agree
as follows:
1.
BASIC INDEMNIFICATION AGREEMENT.
(a) In the event Indemnitee was, is or becomes a party to or
witness
or other participant in, or is threatened to be made a party to or
witness or
other participant in, a Claim (as defined in Section 9(b)) by
reason of (or
arising in part out of) an Indemnifiable Event (as defined in
Section 9(d)), the
Company shall indemnify Indemnitee to the fullest extent permitted
by law as
soon as practicable but in any event no later than 30 days after
written demand
is presented to the Company, against any and all Expenses (as
defined in Section
9(c)), judgments, fines, penalties and amounts paid in settlement
(including all
interest, assessments and other charges paid or payable in
connection therewith)
of such Claim actually and reasonably incurred by or on behalf of
Indemnitee in
connection with such Claim and any federal, state, local or foreign
taxes
imposed on Indemnitee as a result of the actual or deemed receipt
of any
payments under this Agreement. If requested by Indemnitee in
writing, the
Company shall advance (within ten business days of such written
request) any and
all Expenses to Indemnitee (an "Expense Advance"). Notwithstanding
anything in
this Agreement to the contrary, prior to a Change of Control (as
defined in
Section 9(a)) and except as set forth in Sections 1(b), 3 and 7,
Indemnitee
shall not be entitled to indemnification pursuant to this Agreement
in
connection with any Claim (i) initiated by Indemnitee against the
Company or any
director or officer of the Company unless the Company has joined in
or consented
to the initiation of such Claim; (ii) made on account of
Indemnitee's conduct
which constitutes a breach of Indemnitee's duty of loyalty to the
Company or its
stockholders or is an act or omission not in good faith or which
involves
intentional misconduct or a knowing violation of the law; or (iii)
arising from
the purchase and sale by Indemnitee of securities in violation of
Section 16(b)
of the Securities Exchange Act of 1934, as amended (the "Exchange
Act").
(b) Notwithstanding the foregoing, (i) the indemnification
obligations
of the Company under Section 1(a) shall not be applicable if the
Reviewing Party
(as defined in Section 9(f)) has determined (in a written opinion,
in any case
in which the special independent counsel referred to in Section 2
is involved)
that Indemnitee would not be permitted to be indemnified under
applicable law,
and (ii) the obligation of the Company to make an Expense Advance
pursuant to
Section 1(a) shall be subject to the condition that the Company
receives an
undertaking that, if, when and to the extent that the Reviewing
Party determines
that Indemnitee would not be permitted to be so indemnified under
applicable
law, the Company shall be entitled to be reimbursed by Indemnitee
(who hereby
agrees to reimburse the Company) for all such amounts theretofore
paid;
provided, however, that if Indemnitee has commenced legal
proceedings in the
Court of Chancery of the State of Delaware (the "Delaware Court")
to secure a
determination that Indemnitee should be indemnified under
applicable law, any
determination made by the Reviewing Party that Indemnitee would not
be permitted
to be indemnified under applicable law shall not be binding and
Indemnitee shall
not be required to reimburse the Company for any Expense Advance
until a final
judicial determination is made with respect
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thereto (as to which all rights of appeal therefrom have been
exhausted or
lapsed). Indemnitee's obligation to reimburse the Company for
Expense Advances
shall be unsecured and no interest shall be charged thereon. If
there has not
been a Change in Control, the Reviewing Party shall be selected by
the Board of
Directors, and if there has been such a Change in Control, the
Reviewing Party
shall be the special independent counsel referred to in Section 2.
If there has
been no determination by the Reviewing Party or if the Reviewing
Party
determines that Indemnitee substantively would not be permitted to
be
indemnified in whole or in part under applicable law, Indemnitee
shall have the
right to commence litigation in the Delaware Court seeking an
initial
determination by the court or challenging any such determination by
the
Reviewing Party or any aspect thereof and the Company hereby
consents to service
of process and to appear in any such proceeding. Any determination
by the
Reviewing Party otherwise shall be conclusive and binding on the
Company and
Indemnitee. The Company shall indemnify Indemnitee for Expenses
incurred by
Indemnitee in connection with the successful establishment or
enforcement, in
whole or in part, by Indemnitee of Indemnitee's right to
indemnification or
advances.
2.
CHANGE IN CONTROL. The Company agrees that if there is a Change
in
Control of the Company (other than a Change in Control which has
been approved
by two- thirds or more of the Company's Board of Directors who were
directors
immediately prior to such Change in Control) then with respect to
all matters
thereafter arising concerning the rights of Indemnitee to indemnity
payments and
Expense Advances under this Agreement or any other agreement, the
Bylaws or
Certificate of Incorporation now or hereafter in effect relating to
Claims for
Indemnifiable Events, the Company shall seek legal advice only from
special
independent counsel selected by Indemnitee and approved by the
Company (which
approval shall not be unreasonably withheld or delayed) and who has
not
otherwise performed services for the Company within the last five
years (other
than in connection with such matters) or for Indemnitee. In the
event that
Indemnitee and the Company are unable to agree on the selection of
the special
independent counsel, such special independent counsel shall be
selected by lot
from among at least five law firms with offices in the State of
Delaware having
more than fifty attorneys, having a rating of "av" or better in the
then current
Martindale Hubbell Law Directory and having attorneys which
specialize in
corporate law. Such selection shall be made in the presence of
Indemnitee (and
his legal counsel or either of them, as Indemnitee may elect). Such
counsel,
among other things, shall, within 90 days of its retention, render
its written
opinion to the Company and Indemnitee as to whether and to what
extent
Indemnitee would be permitted to be indemnified under applicable
law. The
Company agrees to pay the reasonable fees of the special
independent counsel
referred to above and to fully indemnify such counsel against any
and all
expenses (including attorneys' fees), claims, liabilities, and
damages arising
out of or relating to this Agreement or its engagement pursuant
hereto.
3.
INDEMNIFICATION FOR ADDITIONAL EXPENSES. The Company shall
indemnify
Indemnitee against any and all expenses (including attorneys' fees)
and, if
requested by Indemnitee in writing, shall (within ten business days
of such
written request) advance such expenses to Indemnitee, which are
incurred by
Indemnitee in connection with any Claim asserted against or action
brought by
Indemnitee for (i) indemnification or advance payment of Expenses
by the Company
under this Agreement or any other agreement, the Bylaws or
Certificate of
Incorporation now or hereafter in effect relating to Claims for
Indemnifiable
Events and/or (ii)
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recovery under any directors' and officers' liability insurance
policies
maintained by the Company, regardless of whether the Company
believes that
Indemnitee is entitled to such indemnification, advance expense
payment or
insurance recovery, as the case may be. The Indemnitee shall
qualify for
advances solely upon the execution and delivery to the Company of
an undertaking
providing that the Indemnitee undertakes to repay the advance to
the extent that
it is ultimately determined that the Indemnitee is not entitled to
be
indemnified by the Company.
4.
PARTIAL INDEMNITY. If Indemnitee is entitled under any provisions
of
this Agreement to indemnification by the Company of some but not
all of the
Expenses, liabilities, judgments, fines, penalties and amounts paid
in
settlement of a Claim, the Company shall nevertheless indemnify
Indemnitee for
the portion thereof to which Indemnitee is entitled. Moreover,
notwithstanding
any other provision of this Agreement, to the extent that
Indemnitee has been
successful on the merits or otherwise in defense of any or all
Claims relating
in whole or in part to an Indemnifiable Event or in defense of any
issue or
matter therein, including dismissal without prejudice, Indemnitee
shall be
indemnified against all Expenses incurred in connection therewith.
In connection
with any determination by the Reviewing Party or otherwise as to
whether
Indemnitee is entitled to be indemnified hereunder the burden of
proof shall be
on the Company to establish that Indemnitee is not so entitled.
5.
NO PRESUMPTION. For purposes of this Agreement, the termination of
any
action, suit or proceeding by judgment, order, settlement (whether
with or
without court approval) or conviction, or upon a plea of nolo
contendere, or its
equivalent, shall not create a presumption that Indemnitee did not
meet any
particular standard of conduct or have any particular belief.
6. NOTIFICATION AND
DEFENSE OF CLAIM. Within 30 days after receipt by
Indemnitee of notice of the commencement of a Claim which may
involve an
Indemnifiable Event, Indemnitee will, if a claim in respect thereof
is to be
made against the Company under this Agreement, submit to the
Company a written
notice identifying the proceeding, but the omission so to notify
the Company
will not relieve it from any liability which it may have to
Indemnitee under
this Agreement unless the Company is materially prejudiced by such
lack of
notice. With respect to any such Claim as to which Indemnitee
notifies the
Company of the commencement thereof:
(a) the Company will be entitled to participate therein at its
own
expense;
(b) except as otherwise provided below, to the extent that it
may
wish, the Company jointly with any other indemnifying party
similarly notified
will be entitled to assume the defense thereof, with counsel
selected by the
Board of Directors and
