Exhibit 10.38**INDEMNIFICATION AGREEMENT**     ThisIndemnification Agreement (the “Agreement”) entered into asof this ___ day of ___,20 ___ by and between PharmaNet Development Group, Inc., a Delaware corporation (the “Company”), and___ (the “Indemnitee”):     WHEREAS, competent and experienced persons are becoming increasingly reluctant to servepublicly-held corporations as directors, officers, or in other capacities unless they are providedwith adequate protection through liability insurance or adequate indemnification against inordinaterisks of claims and actions against them arising out of their service to the corporation;     WHEREAS, the board of directors of the Company (the “Board”) has determined that the inabilityto attract and retain such persons is detrimental to the best interests of the Company’sstockholders and that the Company should act to assure such persons that there will be increasedcertainty of such protection in the future;     WHEREAS, Section 145 of the Delaware General Corporation Law (the “DGCL”) empowers the Companyto indemnify its officers, directors, employees and agents by agreement and to indemnify personswho serve, at the request of the Company, as directors, officers, employees or agents of othercorporations or enterprises;     WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligateitself to indemnify such persons to the fullest extent permitted by applicable law so that theywill serve or continue to serve the Company free from undue concern that they will not be soindemnified;     WHEREAS, Indemnitee is willing to serve as an executive officer of the Company on thecondition that he be so indemnified.     NOW, THEREFORE, in consideration of the premises and the mutual covenants contained herein,the Company and Indemnitee do hereby covenant and agree as follows:     1. Definitions. For purposes of this Agreement:          (a) “Act” means the Securities Exchange Act of 1934.          (b) “Beneficial Owner” means (as defined in Rule 13d-3 under the Act), any Person who directlyor indirectly, owns securities of the Company representing 10% or more of the combined voting powerof the Company’s then outstanding securities.          (c) “Change of Control” means a change in control of the Company occurring after the EffectiveDate of a nature that would be required to be reported in response to Item 5.01 on Form 8-K (or inresponse to any similar item on any Securities and Exchange Commission schedule or form)promulgated under the Act, whether or not the Company is then subject to such reportingrequirement; provided, however, that, without limitation, such a Change of Controlshall be deemed to have occurred after the Effective Date if a Person (as defined below) becomesthe Beneficial Owner without the prior approval of at least two-thirds of the directors in
 

 
office immediately prior to such person attaining such percentage; (ii) the Company is a partyto a merger, consolidation, sale of assets or other reorganization, or a proxy contest, as aconsequence of which members of the Board in office immediately prior to such transaction or eventconstitute less than a majority of the Board thereafter; or (iii) during any period of twoconsecutive years, individuals who, at the beginning of such period, constituted the Board(including for this purpose, any new director whose election or nomination for election by theCompany’s stockholders was approved by a vote of at least two-thirds of the directors then still inoffice who were directors at the beginning of such period) cease for any reason to constitute atleast a majority of the Board.          (d) “Corporate Status” describes the status of a person who is or was a director, officer,employee, agent or fiduciary of the Company or of any other corporation, partnership, jointventure, trust, employee benefit plan or other enterprise which such person is or was serving atthe request of the Company.          (e) “Disinterested Director” means a director of the Company who is not and was not a party tothe Proceeding in respect of which indemnification is sought by Indemnitee.          (f) “Effective Date” means the date first above written.          (g) “Expenses” shall include all reasonable attorney’s fees, retainers, court costs,transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing andbinding costs, telephone charges, postage, delivery service fees and all other disbursements orexpenses of the types customarily incurred in connection with prosecuting, defending, preparing toprosecute or defend, investigating, or being or preparing to be a witness in a Proceeding.          (h) “Independent Counsel” means a law firm, or a member of a law firm, that is experienced inmatters of corporation law and neither presently is, nor in the past five years has been, retainedto represent (i) the Company or Indemnitee in any matter material to either such party, or (ii) anyother party to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstandingthe foregoing, the term “Independent Counsel” shall not include any person who, under theapplicable standards of professional conduct then prevailing, would have a conflict of interest inrepresenting either the Company or Indemnitee in an action to determine Indemnitee’s rights underthis Agreement.          (i) “Person” means (as such term is used in Sections 13(d) and 14(d) of the Act) anindividual, a partnership, a corporation, a limited liability company, an association, a jointstock company, a trust, a joint venture, an unincorporated organization, or a governmental entity(or any department, agency, or political subdivision thereof).          (j) “Proceeding” includes any actual or threatened action, suit, arbitration, alternativedispute resolution mechanism, investigation, administrative hearing or any other proceeding whethercivil, criminal, administrative or investigative, whether or not initiated prior to the EffectiveDate, except a proceeding initiated by an Indemnitee pursuant to Section 11 of this Agreement toenforce his rights under this Agreement.
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          (k) “Standard” shall mean the applicable standard of conduct set forth in Sections 145(a) and(b) of the DGCL.     2. Agreement to Serve. Indemnitee agrees to serve as an executive officer of theCompany. Indemnitee may at any time and for any reason resign from such position (subject to anyother contractual obligation or any obligation imposed by operation of law). Similarly, the Companyshall have no obligation under this Agreement to continue Indemnitee in any position with theCompany.     3. Indemnification — General. The Company shall indemnify and advance Expenses toIndemnitee as provided in this Agreement and to the fullest extent permitted by applicable law ineffect on the date hereof and to such greater extent as applicable law may thereafter from time totime permit. However, no indemnification shall be made by the Company (except as ordered by acourt) unless a determination has been made in the manner provided for in Section 145(d) of theDGCL and Section 9(b) herein that Indemnitee has met the applicable Standard. The rights ofIndemnitee provided under the preceding sentence shall include, but shall not be limited to, therights set forth in the other sections of this Agreement.     4. Third Party Actions. Indemnitee shall be entitled to the rights of indemnificationprovided in this Section 4 if, by reason of his Corporate Status, he is, or is threatened to bemade, a party to any Proceeding, other than a Proceeding by or in the right of the Company.Pursuant to this Section 4, Indemnitee shall be indemnified against Expenses (including attorneys’fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him inconnection with such Proceeding or any claim, issue or matter therein, if (i) he acted in goodfaith, and in a manner he reasonably believed to be in or not opposed to the Company’s bestinterests; and (ii) with respect to any criminal Proceeding, had no reasonable cause to believe hisconduct was unlawful. Indemnitee shall not be entitled to indemnification in connection with anyProceeding charging improper personal benefit to the Indemnitee, whether or not involving action inhis official capacity, in which he was judged liable on the basis that personal benefit wasimproperly received by him. Notwithstanding the foregoing, Indemnitee shall not be entitledto indemnification of Expenses paid by him to the extent that: (i) they relate to civil monetarypenalties and/or disgorgement of profits imposed in an action brought by, or in an administrativeproceeding before, the Securities and Exchange Commission; and (ii) such reimbursement wouldviolate public policy or otherwise would be prohibited by the Securities Exchange Commission orapplicable law.     5. Direct and Derivative Actions. Indemnitee shall be entitled to the rights ofindemnification provided in this Section 5, by reason of his Corporate Status, if he is, or isthreatened to be made, a party to any Proceeding brought by or in the right of the Company toprocure a judgment in its favor. Pursuant to this Section, Indemnitee shall be indemnified againstExpenses actually and reasonably incurred by him or on his behalf in connection with suchProceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposedto the best interests of the Company. Notwithstanding the foregoing, no indemnificationagainst such Expenses shall be made in respect of any claim, issue or matter in such Proceeding asto which Indemnitee shall have been adjudged to be liable to the Company unless the Delaware Courtof Chancery or the court in which such Proceeding was brought shall determine upon applicationthat, despite the adjudication of liability but in view of all of the circumstances
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of the case, Indemnitee is fairly and reasonably entitled to indemnification for such Expenseswhich the Delaware Court of Chancery or such other court shall deem proper.     6. Indemnification for Expenses of an Indemnitee. Notwithstanding any otherprovision of this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, aparty to and is successful, on the merits or otherwise, in any Proceeding, he shall be indemnifiedagainst all Expenses actually and reasonably incurred by him in connection therewith. If Indemniteeis not wholly successful in such Proceeding but is successful, on the merits or otherwise, as toone or more but less than all claims, issues or matters in such Proceeding, the Company shallindemnify Indemnitee against all Expenses actually and reasonably incurred by him or on his behalfin connection with each successfully resolved claim, issue or matter. For purposes of this Section6 and without limitation, the termination of any claim, issue or matter in such a Proceeding bydismissal, with or without prejudice, shall be deemed to be a successful result as to such claim,issue or matter.     7. Indemnification for Expenses of a Witness. Notwithstanding any otherprovision of this Agreement, to the extent that Indemnitee is, by reason of his Corporate Status, awitness in any Proceeding, he shall be indemnified against all Expenses actually and reasonablyincurred by him or on his behalf in connection therewith.     8. Advancement of Expenses. The Company shall advance all reasonable Expensesincurred by or on behalf of Indemnitee in connection with any Proceeding within 20 working daysafter the receipt by the Company of a statement or statements from the Indemnitee requesting suchadvance or advances from time to time, whether prior to or after final disposition of suchProceeding. Such statement or statements shall reasonably evidence the Expenses incurred byIndemnitee and shall include, be preceded by or accompanied by, as the case may be, the following:(i) a written affirmation of the Indemnitee’s good-faith that he has met the Standard; (ii) anundertaking by or on behalf of Indemnitee to repay any Expenses advanced if it shall be determinedthat Indemnitee did not meet the Standard or that Indemnitee is not entitled to be indemnifiedagainst such Expenses; and (iii) a determination that the facts then known to those making thedetermination would not preclude indemnification under the DGCL.     Indemnitee understands and agrees that the undertaking required by this Section 8(ii) shall bean unlimited general obligation of the Indemnitee.     9. Indemnification Procedure.          (a) To obtain indemnification under this Agreement, Indemnitee shall submit to the Company awritten request, including therein or therewith such documentation and information as is reasonablyavailable to Indemnitee and is reasonably necessary to determine whether and to what extentIndemnitee is entitled to indemnification. The Secretary of the Company shall, promptly uponreceipt of such a request for indemnification, advise the Board in writing that Indemnitee hasrequested indemnification.          (b) Upon written request by Indemnitee for indemnification pursuant to Section 9(a) hereof, adetermination, if required by applicable law, with respect to Indemnitee’s entitlement theretoshall be made (i) by the Board by a majority vote of a quorum consisting of
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Disinterested Directors; or (ii) if a quorum cannot be obtained or, even if attainable, aquorum of Disinterested Directors so directs, by (a) Independent Counsel in a written opinion; or(b) by the stockholders of the Company. If it is determined that Indemnitee is entitled toindemnification, payment to Indemnitee shall be made within 10 working days after suchdetermination. Indemnitee shall cooperate with the person, persons or entity making suchdetermination with respect to Indemnitee’s entitlement to indemnification, including providing tosuch person, persons or entity upon reasonable advance request any documentation or informationwhich is not privileged or otherwise protected from disclosure and which is reasonably available toIndemnitee and reasonably necessary to such determination.     10. Presumptions and Effect of Certain Proceedings.          (a) If a Change of Control shall have occurred, in making a determination with respect toentitlement to indemnification hereunder, the person or persons or entity making such determinationshall presume that Indemnitee is entitled to indemnification under this Agreement if Indemnitee hassubmitted a request for indemnification in accordance with Section 9(a) of this Agreement, and theCompany shall have the burden of proof to overcome that presumption in connection with the makingby any person, persons or entity of any determination contrary to that presumption.          (b) If the person, persons or entity empowered or selected under Section 9 of this Agreementto determine whether Indemnitee is entitled to indemnification shall not have made a determinationwithin 60 days after receipt by the Company of the request therefor, the requisite determination ofentitlement to indemnification shall be deemed to have been made and Indemnitee shall be entitledto such indemnification, absent (i) a misstatement by Indemnitee of a material fact, or an omissionof a material fact necessary to make Indemnitee’s statement not materially misleading, inconnection with the request for indemnification, or (ii) a prohibition of such indemnificationunder applicable law; provided, however, that such 60-day period may be extendedfor a reasonable time, not to exceed an additional 30 days, if the person, persons or entity makingthe determination with respect to entitlement to indemnification in good faith requires suchadditional time for the obtaining or evaluating of documentation and/or information relatingthereto; and provided, further, that the foregoing provisions of Section 10(b)shall not apply (i) if the determination of entitlement to indemnification is to be made by thestockholders pursuant to Section 9(b) of this Agreement and if (A) within 15 days after receipt bythe Company of the request for such determination the Board has resolved to submit suchdetermination to the stockholders for their consideration at an annual meeting thereof to be heldwithin 75 days after such receipt and such determination is made thereat, or (B) a special meetingof stockholders is called within 15 days after such receipt for the purpose of making suchdetermination, such meeting is held for such purpose within 60 days after having been so called andsuch determination is made thereat, or (ii) if the determination of entitlement to indemnificationis to be made by Independent Counsel pursuant to Section 9(b) of this Agreement.          (c) The termination of any Proceeding or of any claim, issue or matter therein, by judgment,order, settlement, conviction or upon a plea of nolo contendere or its equivalent, shall not(except as otherwise expressly provided in this Agreement) of itself adversely affect the right ofIndemnitee to indemnification or create a presumption that Indemnitee did not act in
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good faith and in a manner which he reasonably believed to be in or not opposed to the bestinterests of the Company, and with respect to any criminal Proceeding, that Indemnitee hadreasonable cause to believe that his conduct was unlawful.     11. Remedies of Indemnitee.          (a) In the event that (i) a determination is made pursuant to Section 9 of this Agreement thatIndemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses isnot timely made pursuant to Section 8 of this Agreement, (iii) the determination of entitlement toindemnification is to be made by Independent Counsel pursuant to Section 9(b) of this Agreement andsuch determination shall not have been made and delivered in a written opinion within 90 days afterreceipt by the Company of the request for indemnification, (iv) payment of indemnification is notmade pursuant to Section 5 of this Agreement within 10 days after receipt by the Company of awritten request therefor, or (v) payment of indemnification is not made within 10 days after adetermination has been made that Indemnitee is entitled to indemnification or such determination isdeemed to have been made pursuant to Section 9 or 10 of this Agreement, Indemnitee shall beentitled to the arbitration remedy contained in Section 24 of this Agreement, of his entitlement tosuch indemnification or advancement of Expenses. Indemnitee shall commence such proceeding seekingan adjudication within 180 days following the date on which Indemnitee first has the right tocommence such proceeding pursuant to this Section 11(a).          (b) In the event that a determination shall have been made pursuant to Section 9 of thisAgreement that Indemnitee is not entitled to indemnification, any arbitration proceeding commencedpursuant to this Section 11 shall be conducted in all respects as a de novo trial on the merits andIndemnitee shall not be prejudiced by reason of that adverse determination. If a Change of Controlshall have occurred, in any arbitration proceeding commenced pursuant to this Section 11, theCompany shall have the burden of proving the Indemnitee is not entitled to indemnification oradvancement of Expenses, as the case may be.          (c) If a determination shall have been made or deemed to have been made pursuant to Section 9or 10 of this Agreement that Indemnitee is entitled to indemnification, the Company shall be boundby such determination in any arbitration proceeding commenced pursuant to this Section 11, absent(i) a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary tomake Indemnitee’s statement not materially misleading, in connection with the request forindemnification, or (ii) a prohibition of such indemnification under applicable law.          (d) The Company shall be precluded from asserting in any arbitration proceeding commencedpursuant to this Section 11 that the procedures and presumptions of this Agreement are not valid,binding and enforceable and shall stipulate in any such arbitration that the Company is bound byall the provisions of this Agreement.          (e) In the event that Indemnitee, pursuant to this Section 11, seeks arbitration, involvingthe Company, to enforce his rights under, or to recover damages for breach of, this Agreement,Indemnitee shall be entitled to recover from the Company, and shall be indemnified by the Companyagainst, any and all Expenses (of the types described in the definition of
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Expenses in Section 1 of this Agreement) actually and reasonably incurred by him in suchjudicial adjudication, but only if he prevails therein. If it shall be determined in saidarbitration that Indemnitee is entitled to receive part but not all of the indemnification oradvancement of Expenses sought, the Expenses incurred by Indemnitee in connection with sucharbitration shall be appropriately prorated.     12. Non-Exclusivity; Survival of Rights; Insurance; Subrogation.          (a) The rights of indemnification and to receive advancement of Expenses as provided by thisAgreement shall not be deemed exclusive of any other rights to which Indemnitee may at any time beentitled under applicable law, the Certificate of Incorporation, the Bylaws, any agreement, a voteof stockholders or a resolution of directors, or otherwise. No amendment, alteration or repeal ofthis Agreement or any provision hereof shall be effective as to any Indemnitee with respect to anyaction taken or omitted by such Indemnitee in his Corporate Status prior to such amendment,alteration or repeal.          (b) To the extent that the Company maintains an insurance policy or policies providingliability insurance for directors, officers, employees, agents or fiduciaries of the Company or ofany other corporation, partnership, joint venture, trust, employee benefit plan or other enterprisewhich such person serves at the request of the Company, Indemnitee shall be covered by such policyor policies in accordance with its or their terms to the maximum extent of the coverage availablefor any such director, officer, employee or agent under such policy or policies.          (c) In the event of any payment under this Agreement, the Company shall be subrogated to theextent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papersrequired and take all action necessary to secure such rights, including execution of such documentsas are necessary to enable the Company to bring suit to enforce such rights.          (d) The Company shall not be liable under this Agreement to make any payment of amountsotherwise indemnifiable hereunder if and to the extent that Indemnitee has otherwise actuallyreceived such payment under any insurance policy, contract, agreement or otherwise.          (e) The Company may, to the full extent authorized by law, create a trust fund, grant asecurity interest and/or use other means (including, without limitation, letters of credit, suretybonds and other similar arrangements) to ensure the payment of such amounts as may become necessaryto effect indemnification provided hereunder.     13. Duration of Agreement. This Agreement shall continue until and terminate upon thelater of: (a) six years after the date that Indemnitee shall have ceased to serve as a director,officer, employee, agent or fiduciary of the Company or of any other corporation, partnership,joint venture, trust, employee benefit plan or other enterprise which Indemnitee served at therequest of the Company; or (b) the final termination of all pending Proceedings in respect of whichIndemnitee is granted rights of indemnification or advancement of Expenses hereunder
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and of any proceeding commenced by Indemnitee pursuant to Section 11 of this Agreementrelating thereto.     14. Gender. Use of the masculine pronoun shall be deemed to include usage of thefeminine pronoun where appropriate.     15. Exceptions to Indemnification Rights. Notwithstanding any other provision of thisAgreement, except for Indemnification or advancement of Expenses in a Proceeding to enforce orclaim therein to enforce the provisions of that Agreement, Indemnitee shall not be entitled toIndemnification or advancement of Expenses with respect to any Proceeding, or any claim therein,brought or made by him against the Company. Provided further that no right of indemnification underthe provisions set forth herein shall be available to any Indemnitee unless within 10 days afterthe later of institution of or learning of any such Proceeding he shall have offered the Company inwriting the opportunity to handle and defend such Proceeding at its own expense.     16. Successors. Subject to the provisions of this Agreement, this Agreement shall bebinding upon and inure to the benefit of the parties hereto and their respective legalrepresentatives, successors and assigns.     17. Severability. In the event any parts of this Agreement are found to be void, theremaining provisions of this Agreement shall nevertheless be binding with the same effect as thoughthe void parts were deleted.     18. Counterparts. This Agreement may be executed in one or more counterparts, each ofwhich shall be deemed an original but all of which together shall constitute one and the sameinstrument. The execution of this Agreement may be by actual or facsimile signature.     19. Benefit. This Agreement shall be binding upon and inure to the benefit of theparties hereto and their legal representatives, successors and assigns.     20. Notices and Addresses. All notices, offers, acceptance and any other acts underthis Agreement (except payment) shall be in writing, and shall be sufficiently given if deliveredto the addressee in person, by Federal Express or similar receipted delivery, by facsimile deliveryor, if mailed, postage prepaid, by certified mail, return receipt requested, as follows:   To the Company: PharmaNet Development Group, Inc.  504 Carnegie Center  Princeton, NJ 08540-6242  Facsimile: (609) 514-0390  Attention: Chief Executive Officer   With a Copy to: Morgan, Lewis & Bockius  502 Carnegie Center  Princeton, NJ 08540  Facsimile:  (609) 919-6701  Attention: Denis Segota, Esq.
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To Indemnitee:or to such other address as either of them, by notice to the other may designate from time to time.The transmission confirmation receipt from the sender’s facsimile machine shall be evidence ofsuccessful facsimile delivery. Time shall be counted to, or from, as the case may be, the deliveryin person or by mailing.     21. Attorneys’ Fees. In the event that there is any controversy or claim arising outof or relating to this Agreement, or to the interpretation, breach or enforcement thereof, and anyaction or proceeding relating to this Agreement is filed, the prevailing party shall be entitled toan award by the court of reasonable attorneys’ fees, costs and expenses.     22. Oral Evidence. This Agreement constitutes the entire Agreement between theparties and supersedes all prior oral and written agreements between the parties hereto withrespect to the subject matter hereof. Neither this Agreement nor any provision hereof may bechanged, waived, discharged or terminated orally, except by a statement in writing signed by theparty or parties against which enforcement or the change, waiver discharge or termination issought.     23. Governing Law. This Agreement and any dispute, disagreement, or issue ofconstruction or interpretation arising hereunder whether relating to its execution, its validity,the obligations provided herein or performance shall be governed or interpreted according to theinternal laws of the State of Delaware without regard to choice of law considerations.     24. Arbitration. Any controversy, dispute or claim arising out of or relating to thisAgreement, or its interpretation, application, implementation, breach or enforcement which theparties are unable to resolve by mutual agreement, shall be settled by submission by either partyof the controversy, claim or dispute to binding arbitration in Mercer County, New Jersey (unlessthe parties agree in writing to a different location), before a single arbitrator in accordancewith the rules of the American Arbitration Association then in effect. In any such arbitrationproceeding the parties agree to provide all discovery deemed necessary by the arbitrator. Thedecision and award made by the arbitrator shall be final, binding and conclusive on all partieshereto for all purposes, and judgment may be entered thereon in any court having jurisdictionthereof.     25. Section or Paragraph Headings. Section headings herein have been inserted forreference only and shall not be deemed to limit or otherwise affect, in any matter, or be deemed tointerpret in whole or in part any of the terms or provisions of this Agreement.
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     IN WITNESS WHEREOF the parties hereto have set their hand and seals the day and year firstabove written.         PHARMANET DEVELOPMENT GROUP, INC.         By:               Jeffrey P. McMullen,      President and Chief Executive Officer           EMPLOYEE          
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