EXHIBIT 10.4
NEUROGESX, INC.
INDEMNIFICATION
AGREEMENT
This Indemnification Agreement
(“Agreement”) is made as of
, 2004 by and between NeurogesX, Inc., a California corporation
(the “Company”), and
(“Indemnitee”).
RECITALS
A. The Company desires to attract
and retain the services of highly qualified individuals to serve as
officers, directors and agents of the Company.
B. The Company and Indemnitee
recognize the increased risk of litigation and other claims being
asserted against directors, officers and other agents of the
Company.
C. The Company desires to provide
indemnification and other rights to Indemnitee in consideration for
Indemnitee’s service to the Company.
In consideration of the covenants
and promises set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
1. Indemnification
.
(a) Third Party Proceedings .
The Company shall indemnify Indemnitee if Indemnitee was or is a
party or is threatened to be made a party to any threatened,
pending or completed action or proceeding, whether civil, criminal,
administrative or investigative (a “ Proceeding
”) (other than an action by or in the right of the Company to
procure a judgment in its favor) by reason of the fact that
Indemnitee is or was a director, officer, employee or other agent
of the Company or by reason of the fact that Indemnitee is or was
serving at the request of the Company as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including
attorneys’ fees), judgments, fines, settlements (if such
settlement is approved in advance by the Company, which approval
shall not be unreasonably withheld) and other amounts actually and
reasonably incurred by Indemnitee in connection with the Proceeding
if Indemnitee acted in good faith and in a manner Indemnitee
reasonably believed to be in the best interests of the Company,
and, in the case of any criminal Proceeding, had no reasonable
cause to believe Indemnitee’s conduct was unlawful. The
termination of any Proceeding by judgment, order, settlement,
conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that (i) Indemnitee
did not act in good faith and in a manner which Indemnitee
reasonably believed to be in the best interests of the Company or
(ii) Indemnitee had reasonable cause to believe that
Indemnitee’s conduct was unlawful.
(b) Proceedings by or in the
Right of the Company . The Company shall indemnify Indemnitee
if Indemnitee was or is a party or is threatened to be made a party
to any threatened, pending or completed action by or in the right
of the Company to procure a judgment in
its favor by reason of the fact that Indemnitee
is or was a director, officer, employee or other agent of the
Company or by reason of the fact that Indemnitee is or was serving
at the request of the Company as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorneys’
fees) actually and reasonably incurred by Indemnitee in connection
with the defense or settlement of such action if Indemnitee acted
in good faith, in a manner Indemnitee believed to be in the best
interests of the Company and its shareholders, except that no
indemnification shall be made (i) in respect of any claim,
issue or matter as to which Indemnitee shall have been adjudged to
be liable to the Company in the performance of Indemnitee’s
duty to the Company and its shareholders unless and only to the
extent that the court in which such Proceeding is or was pending
shall determine upon application that, in view of all the
circumstances of the case, Indemnitee is fairly and reasonably
entitled to indemnity for expenses and then only to the extent that
the court shall determine, (ii) of amounts paid in settling or
otherwise disposing of a pending action without court approval or
(iii) of expenses incurred in defending a pending action which
is settled or otherwise disposed of without court
approval.
2. Expenses; Indemnification
Procedure .
(a) Advancement of Expenses .
The Company shall advance all expenses incurred by Indemnitee in
defending any Proceeding referenced in Section 1(a) or
(b) hereof prior to the final disposition of the Proceeding
(but not amounts actually paid in settlement of any such
Proceeding). Indemnitee hereby undertakes to repay such amounts
advanced if it shall be determined ultimately that Indemnitee is
not entitled to be indemnified by the Company as authorized hereby
or by Section 317 of the California General Corporation Law.
The advances to be made hereunder shall be paid by the Company to
Indemnitee within twenty (20) days following delivery of a
written request therefor by Indemnitee to the Company.
(b) Notice; Cooperation by
Indemnitee . Indemnitee shall, as soon as practicable and as a
condition precedent to Indemnitee’s right to be indemnified
or to receive any advancement of expenses under this Agreement,
give the Company written notice of any claim made against
Indemnitee for which indemnification or advancement of expenses
will or could be sought under this Agreement, specifying the nature
of such claim in reasonable detail. Notice to the Company shall be
directed to the Chief Executive Officer of the Company, or the
Chief Financial Officer if Indemnitee is the Chief Executive
Officer, in accordance with Section 14 hereof. Any delay in
providing notice will not relieve the Company from its obligations
under this Agreement, except to the extent such failure is
prejudicial. Indemnitee shall give the Company such information and
cooperation as it may reasonably require and as shall be within
Indemnitee’s power.
(c) Procedure . Any
indemnification provided for in Section 1 hereof shall be made
no later than forty-five (45) days after written notice by
Indemnitee requesting payment. If a claim under this Agreement,
under any statute or under any provision of the Company’s
Articles of Incorporation or Bylaws providing for indemnification
is not paid in full by the Company within forty-five (45) days
after such written notice, Indemnitee may, but need not, at any
time thereafter bring an action against the Company to recover the
unpaid amount of the claim and, subject to Section 13 hereof,
Indemnitee shall also be entitled to be paid for the expenses
(including attorneys’ fees) of bringing such action. It shall
be a defense to any such action (other than an action brought to
enforce a claim for expenses incurred in connection with any
Proceeding in advance of its final
-2-
disposition) that Indemnitee has not met the
standards of conduct which make it permissible under this Agreement
or applicable law for the Company to indemnify Indemnitee for the
amount claimed, and Indemnitee shall be entitled to receive interim
payments of expenses pursuant to Subsection 2(a) hereof unless and
until such defense may be finally adjudicated by court order or
judgment from which no further right of appeal exists. It is the
parties’ intention that if the Company contests
Indemnitee’s right to indemnification, the question of
Indemnitee’s right to indemnification shall be for the court
to decide, and neither the failure of the Company (including its
Board of Directors, any committee or subgroup of the Board of
Directors, independent legal counsel or its shareholders) to have
made a determination that indemnification of Indemnitee is proper
in the circumstances because Indemnitee has met the applicable
standard of conduct required by applicable law, nor an actual
determination by the Company (including its Board of Directors, any
committee or subgroup of the Board of Directors, independent legal
counsel or its shareholders) that Indemnitee has not met such
applicable standard of conduct, shall create a presumption that
Indemnitee has or has not met the applicable standard of
conduct.
(d) Notice to Insurers . If,
at the time of the receipt of a notice of a claim pursuant to
Section 2(b) hereof, the Company has directors’ and
officers’ liability insurance in effect, the Company shall
give prompt notice of the commencement of the Proceeding to the
insurers in accordance with the procedures set forth in the
respective policies. The Company shall thereafter take all
commercially reasonable action to cause such insurers to pay, on
behalf of the Indemnitee, all amounts payable as a result of such
Proceeding in accordance with the terms of such
policies.
(e) Selection of Counsel . In
the event the Company shall be obligated under Section 2(a)
hereof to pay the expenses of any Proceeding against Indemnitee,
the Company, if appropriate, shall be entitled to assume the
defense of such Proceeding, with counsel approved by Indemnitee,
which approval shall not be unreasonably withheld, upon giving
written notice to Indemnitee of its election so to do. After giving
such notice, approval of such counsel by Indemnitee and the
retention of such counsel by the Company, the Company will not be
liable to Indemnitee under this Agreement for any fees or expenses
of counsel subsequently incurred by Indemnitee with respect to the
same Proceeding, provided that (i) Indemnitee shall have the
right to employ Indemnitee’s counsel in any such Proceeding
at Indemnitee’s expense; and (ii) if (A) the
Company has expressly authorized (and continues to authorize) the
employment of counsel by Indemnitee at the Company’s expense,
(B) the use of counsel chosen by the Company to represent
Indemnitee would present such counsel with a conflict of interest
or (C) the Company shall not, in fact, have employed counsel
reasonably satisfactory to Indemnitee within a reasonable time
after notice of the institution of such Proceeding, then Indemnitee
shall have the right to employ counsel at the expense of the
Company in accordance herewith.
3. Additional Indemnification
Rights; Nonexclusivity .
(a) Scope . Subject to
Section 8 hereof and any other provision of this Agreement
that prohibit
