INDEMNITY AGREEMENT
Exhibit
10.2
INDEMNITY
AGREEMENT
This
Indemnity Agreement (the “Agreement”), dated as of April __, 2006, between SRKP
4, Inc., a Delaware corporation (“SRKP”), Cougar Biotechnology, Inc., a Delaware
corporation (“Cougar” and together with SRKP, the “Companies”), Xxxxxxx X.
Xxxxxxxxxxxx and Xxxxxxx Xxxxxxxxx (together with Xxxxxxx X. Xxxxxxxxxxxx,
the
“Indemnitees”),
W
I T N E
S S E T H:
WHEREAS,
Indemnitees are either members of the board of directors of SRKP (the “Board of
Directors”) or officers of SRKP, or both, and in such capacity or capacities, or
otherwise as Agents (as hereinafter defined) of SRKP, are performing valuable
services for SRKP; and
WHEREAS,
Indemnitees are willing to serve, continue to serve and to take on additional
service for or on behalf of SRKP on the condition that they be indemnified
as
herein provided; and
WHEREAS,
it is intended that Indemnitees shall be paid promptly by SRKP all amounts
necessary to effectuate in full the indemnity provided herein:
NOW,
THEREFORE, in consideration of the premises and the covenants in this Agreement,
and of Indemnitees and the Companies intending to be legally bound hereby,
the
parties hereto agree as follows:
1.
Services
by Indemnitees.
Indemnitees agree to serve as directors or officers of SRKP, or both, so long
as
Indemnitees are duly appointed or elected and qualified in accordance with
the
applicable provisions of the Certificate of Incorporation and bylaws of SRKP,
and until such time as Indemnitees resign or fail to stand for election or
are
removed from Indemnitees’ positions. Indemnitees may from time to time also
perform other services at the request or for the convenience of, or otherwise
benefiting SRKP.
2.
Indemnification.
Subject
to the limitations set forth herein and in Section 6 hereof, the Companies
hereby agree to indemnify Indemnitees as follows:
The
Companies shall, with respect to any Proceeding (as hereinafter defined)
associated with Indemnitees acting in their official capacities as officers
and/or directors of SRKP relating to the consideration, approval or consummation
of that certain
Agreement and Plan of Merger
dated
February 27, 2006 by and between Cougar, SRKP and SRKP Acquisition Corp. (the
“Merger”), indemnify Indemnitees to the fullest extent permitted by Section 145
of the General Corporation Law of Delaware (the “DGCL”) and the Certificate of
Incorporation of SRKP in effect on the date hereof or as such law or Certificate
of Incorporation may from time to time be amended (but, in the case of any
such
amendment, only to the extent such amendment permits SRKP to provide broader
indemnification rights than the law or Certificate of Incorporation permitted
SRKP
to
provide before such amendment). Notwithstanding the foregoing, the Companies
shall not be required to indemnify Indemnitees for acts or omissions of
Indemnitees constituting bad faith, gross negligence or intentional misconduct,
except for actual or alleged gross negligence in connection with the scope
or
depth of the performance of due diligence with respect to Cougar and its
business. The right to indemnification conferred herein and in the Certificate
of Incorporation shall be presumed to have been relied upon by Indemnitees
in
serving or continuing to serve SRKP and shall be enforceable as a contract
right. Without in any way diminishing the scope of the indemnification provided
by this Section 2, the Companies will indemnify Indemnitees against Expenses
(as
hereinafter defined) and Liabilities (as hereinafter defined) actually and
reasonably incurred by Indemnitees or on their behalves in connection with
the
investigation, defense, settlement or appeal of such Proceeding. In addition
to,
and not as a limitation of, the foregoing, the rights of indemnification of
Indemnitees provided under this Agreement shall include those rights set forth
in Sections 7 below. Notwithstanding the foregoing, the Companies shall be
required to indemnify Indemnitees in connection with a Proceeding commenced
by
Indemnitees (other than a Proceeding commenced by Indemnitees to enforce
Indemnitees’ rights under this Agreement) only if the commencement of such
Proceeding was authorized by the Board of Directors. Notwithstanding anything
to
the contrary contained herein, the Companies shall have no obligation to
indemnify the Indemnities to the extent such indemnification would not be
permitted under Section 145 of the DGCL or SRKP’s Certificate of Incorporation
in effect on the date hereof.
3.
Presumptions
and Effect of Certain Proceedings.
Upon
making a request for indemnification, Indemnitees shall be presumed to be
entitled to indemnification under this Agreement and the Companies shall have
the burden of proof to overcome that presumption in reaching any contrary
determination. The termination of any Proceeding by judgment, order, settlement,
arbitration award or conviction, or upon a plea of nolo contendere or its
equivalent shall not affect this presumption or, except as determined by a
judgment or other final adjudication adverse to Indemnitees, establish a
presumption with regard to any factual matter relevant to determining
Indemnitees’ rights to indemnification hereunder. If the person or persons so
empowered to make a determination pursuant to Section 4 hereof shall have failed
to make the requested determination within ninety (90) days after any judgment,
order, settlement, dismissal, arbitration award, conviction, acceptance of
a
plea of nolo contendere or its equivalent, or other disposition or partial
disposition of any Proceeding or any other event that could enable the Companies
to determine Indemnitees’ entitlement to indemnification, the requisite
determination that Indemnitees re entitled to indemnification shall be deemed
to
have been made.
4.
Procedure
for Determination of Entitlement to Indemnification.
(a)
Whenever
Indemnitees believes that Indemnitees are entitled to indemnification pursuant
to this Agreement, Indemnitees shall submit a written request for
indemnification to the Companies. Any request for indemnification shall include
sufficient documentation or information reasonably available to Indemnitees
for
the determination of entitlement to indemnification. In any event, Indemnitees
shall submit Indemnitees’ claim for indemnification within a reasonable time,
not to exceed ninety (90) days after any judgment, order, settlement, dismissal,
arbitration award, conviction, acceptance of a plea of nolo contendere or its
equivalent, or final termination, whichever is the later date for which
Indemnitee requests indemnification.
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(b)
Independent
Legal Counsel (as hereinafter defined) shall determine whether Indemnitees
are
entitled to indemnification. Determination of Indemnitees’ entitlement to
indemnification shall be made not later than ninety (90) days after the
Companies’ receipt of Indemnitees’ written request for such indemnification,
provided that any request for indemnification for Liabilities, other than
amounts paid in settlement, shall have been made after a determination thereof
in a Proceeding.
5.
Specific
Limitations on Indemnification.
Notwithstanding anything in this Agreement to the contrary, the Companies shall
not be obligated under this Agreement to make any payment to Indemnitees with
respect to any Proceeding:
(a)
To
the
extent that payment is actually made to Indemnitees under any insurance policy,
or is made to Indemnitees by either of the Companies or affiliates otherwise
than pursuant to this Agreement. Notwithstanding the availability of such
insurance, Indemnitees also may claim indemnification from the Companies
pursuant to this Agreement by assigning to the Companies any claims under such
insurance to the extent Indemnitees are paid by the Companies;
(b)
For
Liabilities in connection with Proceedings settled without the Companies’
consent, which consent, however, shall not be unreasonably withheld;
(c)
In
no
event shall the Companies be liable to pay the fees and disbursements of more
than one counsel in any single Proceeding except to the extent that, in the
opinion of counsel of the Indemnitees, the Indemnitees have conflicting
interests in the outcome of such Proceeding, or
(d)
To
the
extent it would be otherwise prohibited by law, if so established by a judgment
or other final adjudication adverse to Indemnitees.
6.
Fees
and Expenses of Independent Legal Counsel.
The
Companies agree to pay the reasonable fees and expenses of Independent Legal
Counsel and to fully indemnify such Independent Legal Counsel against any and
all expenses and losses incurred by any of them arising out of or relating
to
this Agreement or their engagement pursuant hereto.
7.
Remedies
of Indemnitees.
(a)
In
the
event that (i) a determination pursuant to Section 4 hereof is made that
Indemnitees are not entitled to indemnification, (ii) payment has not been
timely made following a determination of entitlement to indemnification pursuant
to this Agreement, or (iii) Indemnitees otherwise seek enforcement of this
Agreement, Indemnitees shall be entitled to a final adjudication in the Court
of
Chancery of the State of Delaware of the remedy sought.
(b)
If
a
determination that Indemnitees are entitled to indemnification has been made
pursuant to Section 4 hereof, or is deemed to have been made pursuant to Section
4 hereof or otherwise pursuant to the terms of this Agreement, the Companies
shall be bound by such determination in the absence of a misrepresentation
or
omission of a material fact by Indemnitees in connection with such
determination.
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(c)
The
Companies shall be precluded from asserting that the procedures and presumptions
of this Agreement are not valid, binding and enforceable. The Companies shall
stipulate in any such court or before any such arbitrator that the Companies
are
bound by all the provisions of this Agreement and are precluded from making
any
assertion to the contrary.
(d)
Expenses
reasonably incurred by Indemnitees in connection with Indemnitees’ request for
indemnification under, seeking enforcement of or to recover damages for breach
of this Agreement shall be borne by the Companies when and as incurred by
Indemnitees.
8.
Contribution.
To the
fullest extent permissible under applicable law, if the indemnification provided
for in this Agreement is unavailable to Indemnitees for any reason whatsoever,
the Companies, in lieu of indemnifying Indemnitees, shall contribute to the
amount incurred by Indemnitees, whether for judgments, fines, penalties, excise
taxes, amounts paid or to be paid in settlement and/or for Expenses, in
connection with any claim relating to an indemnifiable event under this
Agreement, in such proportion as is deemed fair and reasonable in light of
all
of the circumstances of such Proceeding in order to reflect (i) the relative
benefits received by the Companies and Indemnitees as a result of the event(s)
and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative
fault of the Companies (and thier directors, officers, employees and agents)
and
Indemnitees in connection with such event(s) and/or transaction(s).
9.
Modification,
Waiver, Termination and Cancellation.
No
supplement, modification, termination, cancellation or amendment of this
Agreement shall be binding unless executed in writing by both of the parties
hereto. No waiver of any of the provisions of this Agreement shall be deemed
or
shall constitute a waiver of any other provisions hereof (whether or not
similar), nor shall such waiver constitute a continuing waiver.
10.
Subrogation.
In the
event of payment under this Agreement, the Companies shall be subrogated to
the
extent of such payment to all of the rights of recovery of Indemnitees, who
shall execute all papers required and shall do everything that may be necessary
to secure such rights, including the execution of such documents necessary
to
enable the Companies effectively to bring suit to enforce such rights.
11.
Notice
by Indemnitees and Defense of Claim.
Indemnitees shall promptly notify the Companies in writing upon being served
with any summons, citation, subpoena, complaint, indictment, information or
other document relating to any matter, whether civil, criminal, administrative
or investigative, but the omission so to notify the Companies will not relieve
it from any liability that it may have to Indemnitees if such omission does
not
prejudice the Companies’ rights. If such omission does prejudice the Companies’
rights, the Companies will be relieved from liability only to the extent of
such
prejudice; nor will such omission relieve the Companies from any liability
that
it may have to Indemnitees otherwise than under this Agreement.
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12.
Notices.
All
notices, requests, demands and other communications hereunder shall be in
writing and shall be deemed to have been duly given if (i) delivered by hand
and
receipted for by the party to whom said notice or other communication shall
have
been directed, or (ii) mailed by certified or registered mail with postage
prepaid, on the third business day after the date on which it is so mailed:
| (a) |
If
to SRKP, to:
|
SRKP 4, Inc. | |
|
0000
Xxxxxx xx xxx Xxxxx, Xxxxx 000
|
|||
|
Xxx
Xxxxxxx, XX 00000
|
|||
|
Attention:
Xxxxxxx X. Xxxxxxxxx
|
|||
| (b) |
If
to Cougar, to:
|
Cougar Biotechnology Inc. | |
|
00000
Xxxxxxxx Xxxx., Xxxxx 000
|
|||
|
Xxx
Xxxxxxx, XX 00000
|
|||
| (c) |
If
to Xx. Xxxxxxxxxxxx, to:
|
Xxxxxxx X. Xxxxxxxxxxxx | |
| 0000 Xxxxxx xx xxx Xxxxx, Xxxxx 000 | |||
|
Xxx
Xxxxxxx, XX 00000
|
|||
| (d) |
If
to Xx. Xxxxxxxxx, to:
|
Xxxxxxx X. Xxxxxxxxx | |
| 0000 Xxxxxx xx xxx Xxxxx, Xxxxx 000 | |||
|
Xxx
Xxxxxxx, XX 00000
|
|||
or
to
such other address as may have been furnished to Indemnitees by the Companies
or
to the Companies by Indemnitees, as the case may be.
13.
Nonexclusivity.
The
rights of Indemnitees hereunder shall not be deemed exclusive of any other
rights to which Indemnitees may be entitled under applicable law, the Companies’
Certificates of Incorporation or bylaws, or any agreements, vote of
stockholders, resolution of the Boards of Directors or otherwise.
14.
Certain
Definitions.
(a)
“Expenses”
shall
include all direct and indirect costs (including, without limitation, attorneys’
fees, retainers, court costs, transcripts, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges,
postage, delivery service fees, all other disbursements or out-of-pocket
expenses) actually and reasonably incurred in connection with either the
investigation, defense, settlement or appeal of a Proceeding or establishing
or
enforcing a right to indemnification under this Agreement, applicable law or
otherwise; provided, however, that “Expenses” shall not include any Liabilities.
(b)
“Independent
Legal Counsel”
shall
mean a law firm or a member of a firm selected by the Companies and approved
by
Indemnitees (which approval shall not be unreasonably withheld). Notwithstanding
the foregoing, the term “Independent Legal Counsel” shall not include any person
who, under the applicable standards of professional conduct then prevailing,
would have a conflict of interest in representing either the Companies or
Indemnitees in an action to determine Indemnitees’ right to indemnification
under this Agreement.
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(c)
“Liabilities”
shall
mean liabilities of any type whatsoever including, but not limited to, any
judgments, fines, ERISA excise taxes and penalties, penalties and amounts paid
in settlement (including all interest assessments and other charges paid or
payable in connection with or in respect of such judgments, fines, penalties
or
amounts paid in settlement) of any Proceeding.
(d)
“Proceeding”
shall
mean any threatened, pending or completed action, claim, suit, arbitration,
alternate dispute resolution mechanism, investigation, administrative hearing
or
any other proceeding whether civil, criminal, administrative or investigative,
that is associated with Indemnitees’ actions as officers and/or directors of
SRKP relating to the approval of or consummation of the Merger, absent bad
faith, gross negligence, intentional misconduct, including any action brought
by
or in the right of SRKP or Cougar.
15.
Binding
Effect; Duration and Scope of Agreement.
This
Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective successors and assigns (including
any
direct or indirect successor by purchase, merger, consolidation or otherwise
to
all or substantially all of the business or assets of the Companies), spouses,
heirs and personal and legal representatives. This Agreement shall continue
in
effect for two (2) years subsequent to the closing of the Merger, regardless
of
whether Indemnitees continues to serve as directors or officers of SRKP.
16.
Severability.
If any
provision or provisions of this Agreement (or any portion thereof) shall be
held
to be invalid, illegal or unenforceable for any reason whatsoever:
(a)
the
validity, legality and enforceability of the remaining provisions of this
Agreement shall not in any way be affected or impaired thereby; and
(b)
to
the
fullest extent legally possible, the provisions of this Agreement shall be
construed so as to give effect to the intent of any provision held invalid,
illegal or unenforceable.
17.
Governing
Law.
This
Agreement shall be governed by and construed and enforced in accordance with
the
laws of the State of Delaware, as applied to contracts between Delaware
residents entered into and to be performed entirely within the State of
Delaware, without regard to conflict of laws rules.
18.
Consent
to Jurisdiction.
The
Companies and Indemnitees each irrevocably consent to the jurisdiction of the
courts of the State of Delaware for all purposes in connection with any action
or proceeding that arises out of or relates to this Agreement and agree that
any
action instituted under this Agreement shall be brought only in the state courts
of the State of Delaware.
19.
Entire
Agreement.
This
Agreement represents the entire agreement between the parties hereto, and there
are no other agreements, contracts or understandings between the parties hereto
with respect to the subject matter of this Agreement.
20.
Counterparts.
This
Agreement may be executed in one or more counterparts, each of which shall
for
all purposes be deemed to be an original but all of which together shall
constitute one and the same Agreement.
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Executed
as of the __ day of April, 2006.
SKRP
4,
INC.
/s/
R.
Rappaport____________________
Name:
Xxxxxxx Xxxxxxxxx
Title: President
COUGAR
BIOTECHNOLOGY INC.
/s
Xxxx X. Auerbach__________________
Name: Xxxx
X.
Xxxxxxxx
Title:
President and Chief Executive Officer
/s/
Xxxxxxx X. Pintsopoulos____________
XXXXXXX
X. XXXXXXXXXXXX
/s/
Xxxxxxx Rappaport_________________
XXXXXXX
XXXXXXXXX
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