Exhibit 10.8

INDEMNIFICATION AGREEMENT

THIS INDEMNIFICATION AGREEMENT (this “Agreement”), effective as of
                    , 20    , is made and entered into by and between Integral
Systems, Inc., a Maryland corporation (the “Company”), and                     ,
a director and/or officer of the Company (“Indemnitee”).

RECITALS

WHEREAS, It is essential to the Company to retain and attract as directors,
officers and employees the most capable persons available;

WHEREAS, Indemnitee is a director and/or officer of the Company;

WHEREAS, Both the Company and Indemnitee recognize the increased risk of
litigation and other claims being asserted against directors of public
companies; and

WHEREAS, In recognition of Indemnitee’s need for substantial protection against
personal liability and in order to maintain Indemnitee’s continued service to
the Company in an effective manner and to provide Indemnitee with specific
contractual assurance that such protection shall be available to Indemnitee, the
Company desires to provide in this Agreement for the indemnification of and the
advancement of expenses to Indemnitee to the fullest extent (whether partial or
complete) permitted by the Maryland General Corporation Law as such law may from
time to time be amended (“Maryland Law”), the Company’s Articles of
Incorporation, as amended (the “Charter”), and the Company’s Bylaws, as set
forth in this Agreement and, to the extent directors’ and officers’ liability
insurance is maintained by the Company, to provide for the continued coverage of
Indemnitee under the Company’s directors’ and officers’ liability insurance
policies.

NOW, THEREFORE, in consideration of the mutual agreements herein set forth and
of Indemnitee’s continuing service to the Company, the parties hereto hereby
agree as follows:

1. Indemnification of Indemnitee; Expenses; Insurance.

(a) The Company shall indemnify Indemnitee to the fullest extent permitted by
Maryland Law against judgments, penalties, fines, settlements and reasonable
Expenses (as defined below) actually incurred by Indemnitee in the event
Indemnitee has been made, or is threatened to be made, a party to an action,
suit, arbitration, alternative dispute resolution mechanism, inquiry,
investigation, hearing or other proceeding (including any appeal therein),
whether civil, criminal, administrative, investigative, legislative or otherwise
(including any proceeding by or in the right of the Company) (each a
“Proceeding”), by reason of Indemnitee’s (i) present or prior service as a
director, officer, employee or agent of the Company, (ii) present or prior
service as a fiduciary of an employee benefit plan of the Company, or
(iii) present or prior service at the request of the Company as a director,
officer, partner, trustee, employee or

 

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agent of, or as a fiduciary of an employee benefit plan of, another corporation,
partnership, joint venture, trust, limited liability company or other enterprise
(any such present or prior service, “Corporate Service”); provided, however,
that no indemnification shall be paid to Indemnitee in relation to matters as to
which Indemnitee is adjudged in a Proceeding or otherwise determined in
accordance with Section 5(c) of this Agreement to be liable for negligence or
misconduct in the performance of Indemnitee’s duty. Notwithstanding anything in
this Agreement to the contrary, and except with respect to a suit initiated by
Indemnitee to enforce rights under this Agreement, prior to a Change in Control
(as defined below) Indemnitee shall not be entitled to indemnification pursuant
to this Agreement in connection with any suit 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 suit.

(b) The Company shall pay or reimburse, in advance of the final disposition of
any Proceeding against Indemnitee to which Indemnitee has been, or is threatened
to be, made a party by reason of Indemnitee’s Corporate Service, all reasonable
Expenses actually incurred by or on behalf of Indemnitee in connection with such
Proceeding to the maximum extent permitted by Maryland Law, upon the receipt by
the Company of a written statement or statements from Indemnitee requesting such
payment or reimbursement. Indemnitee hereby undertakes to repay any amounts
advanced by the Company if it shall ultimately be determined in a final
adjudication from which there is no appeal that Indemnitee has not met the
standard of conduct necessary for indemnification by the Company as provided by
Maryland Law.

(c) For purposes of this Agreement, “Expenses” include without limitation
(i) reasonable expenses actually incurred in connection with the investigation,
defense or settlement of any and all Proceedings, including attorneys’ fees,
witness fees and expenses, fees and expenses of accountants and other advisors,
and retainers and disbursements and advances thereon, and (ii) reasonable
expenses of establishing a right to indemnification or advancement of Expenses
under this Agreement. Expenses shall not include the amount of any judgments,
penalties, fines or settlements paid by or on behalf of Indemnitee.

(d) To the extent the Company maintains an insurance policy or policies
providing director, officer and/or employee liability insurance, Indemnitee
shall be covered by such policy or policies, in accordance with its or their
terms, to the maximum extent of the coverage available for any director, officer
or employee (as the case may be) of the Company. The Company shall not be liable
under this Agreement to make any payment to Indemnitee to the extent Indemnitee
has otherwise actually received payment (under any insurance policy, the
Company’s Charter or the Company’s Bylaws or otherwise) of the amounts otherwise
indemnifiable.

2. Indemnification for Costs, Charges and Expenses of Successful Party. To the
extent that Indemnitee has been successful, on the merits or otherwise, in
defense of any Proceeding or in defense of any claim, issue or matter therein,
including, without limitation, the dismissal of any action without prejudice, or
if it is ultimately determined in a final adjudication from which there is no
appeal that Indemnitee is otherwise entitled to be indemnified against Expenses,
Indemnitee shall be indemnified against all reasonable Expenses actually
incurred in connection therewith.

 

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3. Partial Indemnification. If Indemnitee is entitled under any provision of
this Agreement to indemnification by the Company for some or a portion of the
judgments, penalties, fines, settlements or reasonable Expenses actually
incurred in connection with any Proceeding, or in connection with any suit
brought by Indemnitee to enforce a right to indemnification or advancement of
Expenses under this Agreement, but not, however, for all of the total amount
thereof, the Company shall nevertheless indemnify Indemnitee for the portion of
such judgments, penalties, fines, settlements, liabilities or Expenses to which
Indemnitee is entitled.

4. Indemnification for Expenses of a Witness. Notwithstanding any other
provision of this Agreement, to the maximum extent permitted by Maryland Law,
Indemnitee shall be entitled to indemnification against all reasonable Expenses
actually incurred or suffered by Indemnitee or on Indemnitee’s behalf if
Indemnitee appears as a witness or otherwise incurs legal expenses as a result
of or related to Indemnitee’s service as a director or officer of the Company,
in any threatened, pending or completed action, suit, arbitration, alternative
dispute resolution mechanism, inquiry, investigation, hearing or other
proceeding or matter to which Indemnitee neither has been made, nor is
threatened to be made, a party.

5. Procedure for Obtaining Indemnification and Expenses.

(a) Upon written request by an Indemnitee for indemnification pursuant to
Section 1(a) of this Agreement, the entitlement of Indemnitee to indemnification
(unless provided pursuant to Section 2 hereof or ordered by a court), shall be
determined in accordance with Section 5(c) hereof and such indemnification shall
be paid in full within 60 days after the receipt by the Company of a written
statement or statements requesting indemnification. Such statement or statements
shall include such documentation or information which is necessary for such
determination and which is reasonably available to the Indemnitee.

(b) Upon making a request for indemnification, Indemnitee shall be presumed to
be entitled to indemnification hereunder and the Company shall have the burden
of proving that Indemnitee is not entitled to be indemnified. If the person or
persons empowered to make the determination regarding Indemnitee’s entitlement
to indemnification pursuant to Section 5(c) hereof fail to make such
determination within 60 days after the receipt by the Company of a written
statement or statements requesting indemnification, a requisite determination of
entitlement to indemnification shall be deemed to have been made and Indemnitee
shall be absolutely entitled to such indemnification, absent actual and material
fraud in the request for indemnification.

(c) Any indemnification (unless provided pursuant to Section 2 hereof or ordered
by a court) shall be made by the Company only as authorized in the specified
case upon a determination that indemnification of Indemnitee is permissible in
the circumstances because Indemnitee has met the requisite standard of conduct
provided by Maryland Law. Such determination shall be made by any of (i) the
Company’s Board of Directors by a majority vote

 

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of a quorum consisting of directors not, at the time, parties to the Proceeding
(“Disinterested Directors”), (ii) if such a quorum cannot be obtained, by a
majority vote of a committee of the Board of Directors consisting solely of
Disinterested Directors designated by a majority vote of the full Board of
Directors (in which directors who are parties to the Proceeding may
participate), (iii) by Special Independent Counsel (as defined below) in a
written opinion, which Special Independent Counsel shall be selected by the
Board of Directors by a majority vote of a quorum consisting of Disinterested
Directors or, if such a quorum cannot be obtained, by a majority vote of a
committee of the Board of Directors consisting solely of Disinterested Directors
designated by a majority vote of the full Board of Directors (in which directors
who are parties to the Proceeding may participate), or if the requisite quorum
of the full Board of Directors cannot be obtained and the committee cannot be
established, by a majority vote of the full Board of Directors (in which
directors who are parties to the Proceeding may participate), (iv) the Company’s
stockholders, with the shares owned by Indemnitee not being entitled to vote
thereon, (v) by a court of appropriate jurisdiction, or (vi) in the event that a
Change in Control has occurred, by Special Independent Counsel in accordance
with Section 7(a) of this Agreement.

(d) For purposes of this Agreement (i) the termination of any Proceeding by
judgement, order or settlement (whether with or without court approval) shall
not in and of itself create a presumption that Indemnitee did not meet the
requisite standard of conduct provided by Maryland Law, and (ii) the termination
of any Proceeding by conviction, or upon a plea of nolo contendere or its
equivalent, or an entry of an order of probation prior to judgment, shall create
a rebuttable presumption that Indemnitee did not meet the requisite standard of
conduct provided by Maryland Law.

(e) The Expenses to be advanced pursuant to Section 1(b) of this Agreement shall
be paid in full within 30 days after the receipt by the Company of a written
statement or statements requesting such payment. Such statement or statements
shall reasonably evidence the Expenses actually incurred or to be incurred by
Indemnitee in connection with such Proceeding and shall include or be preceded
or accompanied by a written affirmation by Indemnitee of Indemnitee’s good faith
belief that Indemnitee has met the requisite standard of conduct provided by
Maryland Law and a written undertaking by or on behalf of Indemnitee to repay
any amounts advanced by the Company if it shall ultimately be determined in a
final adjudication from which there is no appeal that such standard of conduct
has not been met.

(f) Any amounts incurred by Indemnitee in connection with a request for
indemnification or advancement under this Agreement, any other agreement, the
Company’s Charter or Bylaws in effect, or any directors’ and officers’ liability
insurance, shall be borne by the Company.

6. Enforcing the Agreement.

(a) If Indemnitee properly makes a request for indemnification or advancement of
Expenses that is payable pursuant to the terms of this Agreement and
(i) indemnification is not paid in full by the Company, or on its behalf, within
60 days after the

 

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receipt by the Company of a written statement or statements requesting
indemnification, (ii) a determination is made pursuant to Section 5(c) of this
Agreement that Indemnitee is not entitled to indemnification, or (iii) advances
are not paid in full by the Company, or on its behalf, within 30 days after the
receipt by the Company of a written statement or statements requesting such
payment, Indemnitee may at any time thereafter bring suit against the Company to
recover the unpaid amount of any request for indemnification or advancement of
Expenses. If successful in whole or in part in any such suit, Indemnitee also
shall be entitled to be paid all reasonable expenses actually incurred by
Indemnitee in connection with prosecuting such claim.

(b) In any suit brought by Indemnitee to enforce a right to indemnification
under this Agreement (but not in a suit brought by Indemnitee to enforce a right
to advancement of Expenses) it shall be a defense that indemnification is not
permitted by applicable law. Further, in any suit by the Company to recover an
advancement of Expenses, the Company shall be entitled to recover such Expenses
if it shall ultimately be determined in a final adjudication from which there is
no appeal that indemnification is not permitted by applicable law. In any suit
brought by Indemnitee to enforce a right to indemnification or advancement of
Expenses under this Agreement, or by the Company to recover an advancement of
Expenses, the burden of proving that Indemnitee is not entitled to be
indemnified, or to such advancement of Expenses, shall be on the Company.

(c) In any suit brought by Indemnitee to enforce a right to indemnification or
advancement of Expenses under this Agreement, the determination of Indemnitee’s
entitlement to indemnification or advancement of Expenses shall be made de novo
and Indemnitee shall not be prejudiced by reason of a determination (if so made)
pursuant to Section 5(c) of this Agreement that Indemnitee is not entitled to
indemnification. Neither the failure of the Company (including the Disinterested
Directors, a committee of Disinterested Directors, Special Legal Counsel or the
Company’s stockholders) to have made a determination prior to the commencement
of such suit that indemnification of Indemnitee is permissible in the
circumstances because Indemnitee has met the requisite standard of conduct
provided by Maryland Law, nor an actual determination by the Company (including
the Disinterested Directors, a committee of Disinterested Directors, Special
Legal Counsel or the Company’s stockholders) that Indemnitee has not met such
standard of conduct, shall create a presumption that Indemnitee is not entitled
to indemnification or, in the case of such a suit brought by Indemnitee, be a
defense to such suit.

(d) If a determination is made or deemed to have been made under the terms of
this Agreement that Indemnitee is entitled to indemnification, the Company shall
be bound by such determination and shall be precluded from asserting that such
determination has not been made or that the procedure by which such
determination was made is not valid, binding and enforceable. The Company
further agrees to stipulate in any court in which Indemnitee brings suit to
recover the unpaid amount of any request for indemnification or advancement of
Expenses that the Company is bound by all the provisions of this Agreement and
is precluded from making any assertions to the contrary.

 

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7. Change in Control.

(a) The Company agrees that if there is a Change in Control, then with respect
to all matters thereafter arising concerning the rights of Indemnitee to payment
of indemnification and advancement of Expenses under this Agreement or any other
agreement, or the Company’s Charter or Bylaws in effect, relating to any
Proceeding to which Indemnitee has been, or is threatened to be, made a party,
by reason of Indemnitee’s Corporate Service, the Company shall seek legal advice
only from a “Special Independent Counsel” selected by Indemnitee, having prior
experience with indemnification claims under Maryland Law and approved by the
Company (which approval shall not be unreasonably withheld or delayed), and who
has not otherwise performed services for the Company or Indemnitee within the
last five years (other than in connection with such matters). Such Special
Independent Counsel, among other things, shall render his, her or its written
opinion to the Company and Indemnitee as to whether and to what extent
Indemnitee would be permitted to be indemnified under applicable Maryland Law.
The Company agrees to pay the reasonable fees of the Special Independent Counsel
referred to above and shall fully indemnify such Special Independent Counsel
against any and all costs (including attorneys’ fees), claims, liabilities and
damages arising out of or relating to this Agreement.

(b) For purposes of this Agreement, a “Change in Control” occurs if (i) any
person becomes the direct or indirect beneficial owner of securities
constituting 40% or more of the total voting power of the Company’s outstanding
voting securities without the consent of the Company’s Board of Directors,
(ii) within any two consecutive year period, individuals who at the beginning of
such period constitute the Board of Directors of the Company and any new
director(s) appointed or nominated for election to the Board of Directors by a
majority of the directors then still in office who either were directors at the
beginning of such period or whose appointment or nomination was previously so
approved cease for any reason to constitute a majority of the Board of
Directors, or (iii) the Company is party to a merger, a consolidation, a plan of
complete liquidation of the Company, the sale or disposition of all or
substantially all the Company’s assets (in one transaction or a series of
transactions), or a proxy contest, as a consequence of which members of the
Board of Directors of the Company in office immediately prior to such
transaction or event constitute less than a majority of the Board of Directors
thereafter.

8. Notification and Defense of Claim; Approval of Settlements. Promptly after
receipt by Indemnitee of notice of any Proceeding, Indemnitee shall, if a claim
in respect thereof is to be made against the Company under this Agreement,
notify the Company in writing of the commencement thereof; but the omission so
to notify the Company shall not relieve it from any liability that it may have
to Indemnitee. Notwithstanding any other provision of this Agreement, with
respect to any such Proceeding of which Indemnitee notifies the Company:

(a) The Company shall be entitled to participate therein at its own expense; and

 

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(b) Except as otherwise provided in this Section 8, to the extent that it may
wish, the Company, jointly with any other indemnifying party similarly notified,
shall be entitled to assume the defense thereof, with counsel satisfactory to
Indemnitee. After notice from the Company to Indemnitee of its election to
assume the defense of a Proceeding, the Company shall not be liable to
Indemnitee under this Agreement for any expenses of counsel subsequently
incurred by Indemnitee in connection with the defense thereof except as
otherwise provided below. Indemnitee shall have the right to employ Indemnitee’s
own counsel in such Proceeding, but the Expenses of such counsel incurred after
notice from the Company of its assumption of the defense of the Proceeding shall
be at the expense of Indemnitee unless (i) the employment of counsel by
Indemnitee has been authorized by the Company, (ii) Indemnitee shall have
reasonably concluded that there may be a conflict of interest between the
Company and Indemnitee in the conduct of the defense of such Proceeding, or
(iii) the Company shall not within 60 days of receipt of notice from Indemnitee
in fact have employed counsel to assume the defense of the Proceeding, in each
of which cases the Expenses of Indemnitee’s counsel shall be at the expense of
the Company. The Company shall not be entitled to assume the defense of any
Proceeding brought by or on behalf of the Company or as to which Indemnitee
shall have made the conclusion provided for in (ii) above.

(c) The Company shall not be liable to indemnify Indemnitee under this Agreement
for any amounts paid in settlement of any Proceeding effected without the
Company’s prior written approval. The Company shall not settle any Proceeding in
any manner that would impose any penalty or limitation on, or disclosure
obligation with respect to, Indemnitee without Indemnitee’s written approval.
Neither the Company nor Indemnitee shall unreasonably withhold its approval to
any proposed settlement.

9. Action by the Company. The Company shall use commercially reasonable efforts
to take, or cause to be taken, all action necessary to fulfill any requirements
to providing indemnification as contemplated by this Agreement, including, but
not limited to, any actions required by Maryland Law. The Company shall use
commercially reasonable efforts to cause any successor (whether direct or
indirect, by purchase, merger, consolidation, reorganization or otherwise) to
all or substantially all of the business or assets of the Company to assume and
agree to perform this Agreement in the same manner and to the same extent the
Company would be required to perform if no such succession had taken place. This
Agreement shall be binding upon and inure to the benefit of the Company and any
successor to the Company, including, without limitation, any person acquiring
directly or indirectly all or substantially all of the business or assets of the
Company whether by purchase, merger, consolidation, reorganization or otherwise
(and such successor shall thereafter be deemed the “Company” for purposes of
this Agreement), but shall not otherwise be assignable, transferable or
delegable by the Company.

10. Continuation of Rights. All agreements and obligations of the Company
contained herein shall continue during Indemnitee’s Corporate Service and shall
continue thereafter with respect to any possible claims based on or arising out
of Indemnitee’s Corporate Service. This Agreement shall inure to the benefit of
and be enforceable by Indemnitee and Indemnitee’s personal or legal
representatives, executors, administrators, successors, heirs, distributees and
legatees.

 

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11. Non-Exclusivity, Etc. The rights of Indemnitee hereunder shall be in
addition to any other rights Indemnitee may have under the Company’s Charter,
the Company’s Bylaws, Maryland Law or otherwise; provided, however, that to the
extent that any change is made to Maryland Law (whether by legislative action or
judicial decision), the Company’s Charter and/or the Company’s Bylaws which
permits any greater right to indemnification than that provided under this
Agreement as of the date hereof, Indemnitee shall be deemed to have such greater
right hereunder. The Company shall not adopt any amendment to its Charter or
Bylaws the effect of which would be to deny, diminish or encumber Indemnitee’s
right to indemnification or advancement of Expenses under its Charter, its
Bylaws, Maryland Law or otherwise as applied to any act or failure to act
occurring in whole or in part prior to the date upon which the amendment was
approved by the Company’s Board of Directors and/or its stockholders, as the
case may be.

12. Counterparts. This Agreement may be executed in any number of counterparts
and any party hereto may execute any such counterpart, each of which when
executed and delivered shall be deemed to be an original and all of which
counterparts taken together shall constitute but one and the same instrument.

13. Governing Law; Consent to Jurisdiction. This Agreement shall be governed by
and construed, interpreted and enforced in accordance with the laws of the State
of Maryland without giving effect to the principles of conflicts of laws. The
Company and Indemnitee each hereby irrevocably consent to the jurisdiction of
the courts of the State of Maryland for all purposes in connection with any
action, suit or proceeding which arises out of or is related to this Agreement.

14. Prior Agreements; Severability. This Agreement shall supersede and replace
any prior indemnification agreements entered into by and between the Company and
Indemnitee and any such prior agreements shall be terminated upon execution of
this Agreement. The provisions of this Agreement shall be severable in the event
that any of the provisions hereof (including any provision within a single
section, paragraph or sentence) are held by a court of competent jurisdiction to
be invalid, void or otherwise unenforceable in any respect, and the validity and
enforceability of any such provision in every other respect and of the remaining
provisions shall not be in any way impaired, and shall remain enforceable to the
fullest extent permitted by Maryland Law.

15. No Third Party Beneficiaries. Except as expressly provided herein, no
provision of this Agreement is intended, nor shall be interpreted, to provide or
create any third party beneficiary rights or any other rights of any kind in any
client, customer, affiliate, shareholder, employee or partner of Indemnitee (as
the case may be) or any other person or entity.

16. Subrogation. Upon a payment to Indemnitee under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
Indemnitee to recover against any person for such liability, and Indemnitee
shall execute all documents and instruments required and shall take such other
actions as may be necessary to secure such rights, including the execution of
such documents as may be necessary for the Company to bring suit to enforce such
rights.

 

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17. Headings: Section References. The headings and other captions in this
Agreement are for convenience and reference only and shall not be used in
interpreting, construing or enforcing any of the provisions of this Agreement.

18. Amendment and Waiver. No provision of this Agreement may be waived, modified
or discharged unless such waiver, modification or discharge is agreed to in a
writing signed by Indemnitee and the Company. No waiver by either party hereto
at any time of any breach by the other party hereto or compliance with any
condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time.

* * * * *

Signature Page Follows.

 

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IN WITNESS WHEREOF, the parties to this Agreement have executed this Agreement
as of the date first above written.

 

INTEGRAL SYSTEMS, INC.

 

By:

 

 

Name:

 

Title:

 

INDEMNITEE

 

By:

 

 

Name:

 

Title:

 

[SIGNATURE PAGE TO INDEMNIFICATION AGREEMENT]

 

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