EXHIBIT 10.12
 
INDEMNITY AGREEMENT
 
THIS INDEMNITY AGREEMENT (“Agreement”) is made and entered into this         
     day of              20     by and between EXAR CORPORATION, a Delaware
corporation (“Corporation”), and              (“Agent”).
 
RECITALS
 
WHEREAS, Agent performs a valuable service to the Corporation in h     capacity
as              of the Corporation;
 
WHEREAS, the stockholders of the Corporation have adopted bylaws (the “Bylaws”)
providing for the indemnification of the directors, officers, employees and
other agents of the Corporation, including persons serving at the request of the
Corporation in such capacities with other corporations or enterprises, as
authorized by the Delaware General Corporation Law, as amended (“Delaware Law”);
 
WHEREAS, the Bylaws and Delaware Law by their non-exclusive nature, permit
contracts between the Corporation and its directors, officers, employees and
other agents with respect to indemnification of such persons; and
 
WHEREAS, in order to induce Agent to serve as                           of the
Corporation, the Corporation has determined and agreed to enter into this
Agreement with Agent;
 
NOW, THEREFORE, in consideration of Agent’s continued service as             
             after the date hereof, and in any other capacity in which Agent may
serve the Corporation after the date hereof, the parties hereto agree as
follows:
 
AGREEMENT
 
1.    Services to the Corporation.    Agent will serve, at the will of the
Corporation or under separate contract, if any such contract exists, as a
director, officer or other fiduciary of the Corporation or as a director,
officer or other fiduciary of an affiliate of the Corporation (including any
employee benefit plan of the Corporation) faithfully and to the best of h    
ability so long as              is duly elected and qualified in accordance with
the provisions of the Bylaws or other applicable charter documents of the
Corporation or such affiliate; provided, however, that Agent may at any time and
for any reason resign from such position (subject to any contractual obligation
that Agent may have assumed apart from this Agreement) and that the Corporation
or any affiliate shall have no obligation under this Agreement to continue Agent
in any such position.
 
2.    Indemnity of Agent.    The Corporation hereby agrees to hold harmless and
indemnify Agent to the fullest extent authorized or permitted by the provisions
of the Bylaws and Delaware Law, as the same may be amended from time to time
(but, only to the extent that such amendment permits the Corporation to provide
broader

1

--------------------------------------------------------------------------------

indemnification rights than the Bylaws or Delaware Law permitted prior to
adoption of such amendment).
 
3.    Additional Indemnity.    In addition to and not in limitation of the
indemnification otherwise provided for herein, and subject only to the
exclusions set forth in Section 5 hereof, the Corporation hereby further agrees
to hold harmless and indemnify Agent:
 
(a)  against any and all Expenses (as defined in Section 16(b) hereof) that
Agent becomes legally obligated to pay because of any claim or claims made
against or by h     in connection with any Proceeding (as defined in Section
16(a) hereof), (including an action by or in the name of the Corporation) by
reason of the fact that Agent is, was or at any time becomes a director,
officer, employee or other agent of Corporation, or is or was serving or at any
time serves at the request of the Corporation as a director, officer, employee
or other agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise; and
 
(b)  otherwise to the fullest extent as may be provided to Agent by the
Corporation under the non-exclusivity provisions of Delaware Law and Section 42
of the Bylaws.
 
4.    Reviewing Party.    Notwithstanding the foregoing, the obligations of the
Corporation under Sections 2 and 3 shall be subject to the condition that the
Reviewing Party (as defined in Section 16(f) hereof) shall not have determined
that Agent would not be permitted to be indemnified under applicable law.
 
5.    Limitations on Additional Indemnity.    No indemnity pursuant to Section 3
hereof shall be paid by the Corporation:
 
(a)  on account of any claim against Agent for an accounting of profits made
from the purchase or sale by Agent of securities of the Corporation pursuant to
the provisions of Section 16(b) of the Securities Exchange Act of 1934 and
amendments thereto or similar provisions of any federal, state or local
statutory law;
 
(b)  on account of Agent’s conduct that was knowingly fraudulent or deliberately
dishonest or that constituted willful misconduct;
 
(c)  on account of Agent’s conduct that constituted a breach of Agent’s duty of
loyalty to the Corporation or resulted in any personal profit or advantage to
which Agent was not legally entitled;
 
(d)  for which payment is actually made to Agent under a valid and collectible
insurance policy or under a valid and enforceable indemnity clause, bylaw or
agreement, except in respect of any excess beyond payment under such insurance,
clause, bylaw or agreement;
 
(e)  if indemnification is not lawful (and, in this respect, both the
Corporation and Agent have been advised that the Securities and Exchange
Commission believes that indemnification for liabilities arising under the
federal securities laws is against public

2

--------------------------------------------------------------------------------

policy and is, therefore, unenforceable and that claims for indemnification
should be submitted to appropriate courts for adjudication); or
 
(f)  in connection with any Proceeding (or part thereof) initiated by Agent, or
any Proceeding by Agent against the Corporation or its directors, officers,
employees or other agents, unless (i) such indemnification is expressly required
to be made by law, (ii) the Proceeding was authorized by the Board of Directors
of the Corporation, (iii) such indemnification is provided by the Corporation,
in its sole discretion, pursuant to the powers vested in the Corporation under
Delaware Law, or (iv) the Proceeding is initiated pursuant to Section 12 hereof.
 
6.    Continuation of Indemnity.    All agreements and obligations of the
Corporation contained herein shall continue during the period Agent is a
director, officer, employee or other agent of the Corporation (or is or was
serving at the request of the Corporation as a director, officer, employee or
other agent of another corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise) and shall continue thereafter so long as Agent
shall be subject to any possible claim or Proceeding by reason of the fact that
Agent was serving in the capacity referred to herein.
 
7.    Partial Indemnification.    Agent shall be entitled under this Agreement
to indemnification by the Corporation for a portion of the Expenses that Agent
becomes legally obligated to pay in connection with any Proceeding referred to
in Sections 2 and 3 hereof even if not entitled hereunder to indemnification for
the total amount thereof, and the Corporation shall indemnify Agent for the
portion thereof to which Agent is entitled.
 
8.    Notification and Defense of Claim.    Not later than thirty (30) days
after receipt by Agent of notice of the commencement of any Proceeding, Agent
will, if a claim in respect thereof is to be made against the Corporation under
this Agreement, provide written notification to the Corporation of the
commencement thereof, including such documentation and information as is
reasonably available to Agent and is reasonably necessary to determine whether
and to what extent Agent is entitled to indemnification; but the omission so to
notify the Corporation will not relieve it from any liability which it may have
to Agent otherwise than under this Agreement. With respect to any Proceeding as
to which Agent notifies the Corporation of the commencement thereof:
 

 
(a)
 
the Corporation will be entitled to participate therein at its own expense;

 

 
(b)
 
Agent shall give the Corporation such information and cooperation as it may
reasonably require and as shall be within Agent’s power;

 

 
(c)
 
except as otherwise provided below, the Corporation may, at its option and
jointly with any other indemnifying party similarly notified and electing to
assume such defense, assume the defense thereof, with counsel reasonably
satisfactory to Agent upon the delivery to Agent of written notice of its
election to do so. After notice from the Corporation to Agent of its election to
assume the defense thereof, the Corporation will not be liable to Agent under
this Agreement for any Expenses subsequently incurred by Agent in connection
with the defense thereof except for reasonable costs of investigation or
otherwise as provided

3

--------------------------------------------------------------------------------

 
    
 
below. Agent shall have the right to employ separate counsel in such Proceeding
but the fees and expenses of such counsel incurred after notice from the
Corporation of its assumption of the defense thereof shall be at the expense of
Agent unless (i) the employment of counsel by Agent has been authorized by the
Corporation, (ii) Agent shall have reasonably concluded that there may be a
conflict of interest between the Corporation and Agent in the conduct of the
defense of such action or (iii) the Corporation shall not in fact have employed
counsel to assume the defense of such action, in each case the fees and expenses
of Agent’s separate counsel shall be at the expense of the Corporation. The
Corporation shall not be entitled to assume the defense of any Proceeding
brought by or on behalf of the Corporation or as to which Agent shall have made
the conclusion provided for in clause (ii) above; and

 

 
(d)
 
the Corporation shall not be liable to indemnify Agent under this Agreement for
any amounts paid in settlement of any action or claim effected without its
written consent, which shall not be unreasonably withheld. The Corporation shall
be permitted to settle any action except that it shall not settle any action or
claim in any manner which would impose any penalty or limitation on Agent
without Agent’s written consent, which may be given or withheld in Agent’s sole
discretion.

 
9.    Expenses.    The Corporation shall advance, prior to the final disposition
of any Proceeding, promptly and, in any event, within 20 days following request
therefor, all Expenses incurred by Agent in connection with such Proceeding upon
receipt of an undertaking by or on behalf of Agent to repay said amounts if it
shall be determined ultimately that Agent is not entitled to be indemnified
under the provisions of this Agreement, the Bylaws, Delaware Law or otherwise.
If Agent has commenced a legal proceeding in a court of competent jurisdiction
to secure a determination that Agent should be indemnified under applicable law,
any determination made by the Reviewing Party that Agent would not be permitted
to be indemnified under applicable law shall not be binding and Agent shall not
be required to reimburse the Corporation until a final judicial determination is
made with respect thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). Agent’s obligation to reimburse the Corporation shall be
unsecured and no interest shall be charged thereon.
 
10.    Notice to Insurers.    If, at the time of the receipt of the Corporation
of notice of any Proceeding, pursuant to Section 8 hereof, the Corporation has
liability insurance in effect which may cover such Proceeding, the Corporation
shall give prompt notice of the commencement of such Proceeding in accordance
with the procedures set forth in the respective policies. The Corporation shall
thereafter take all necessary or desirable action to cause such insurers to pay,
on behalf of Agent, all Expenses payable as a result of such Proceeding in
accordance with the terms of such policies.
 
11.    Contribution.    If the indemnification provided for in Sections 2 and 3
above for any reason is held by a court of competent jurisdiction to be
unavailable to Agent in respect of any Expenses that Agent becomes legally
obligated to pay, then the Corporation, in lieu of indemnifying Agent
thereunder, shall contribute to the amount

4

--------------------------------------------------------------------------------

paid or payable by Agent (i) in such proportion as is appropriate to reflect the
relative benefits received by the Corporation and Agent, or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Corporation
and Agent in connection with the action or inaction which resulted in such
Expenses, as well as any other relevant equitable considerations.
 
12.    Enforcement.    Any right to indemnification or advances granted by this
Agreement to Agent shall be enforceable by or on behalf of Agent in any court of
competent jurisdiction if (i) the claim for indemnification or advances is
denied, in whole or in part, or (ii) no disposition of such claim is made within
ninety (90) days of request therefor. Agent, in such enforcement action, if
successful in whole or in part, shall also be entitled to be paid the Expenses
of prosecuting h     claim. It shall be a defense to any action for which a
claim for indemnification is made under Section 8 hereof (other than an action
brought to enforce a claim for Expenses pursuant to Section 9 hereof, provided
that the required undertaking has been tendered to the Corporation) that Agent
is not entitled to indemnification because of the limitations set forth in
Section 5 hereof, but the burden of proving such defense shall be on the
Corporation. Neither the failure of the Corporation (including its Board of
Directors, independent legal counsel or its stockholders) to have made a
determination prior to the commencement of such enforcement action that
indemnification of Agent is proper in the circumstances, nor an actual
determination by the Corporation (including its Board of Directors, independent
legal counsel or its stockholders) that such indemnification is improper shall
be a defense to the action or create a presumption that Agent is not entitled to
indemnification under this Agreement or otherwise. If a determination shall have
been made pursuant to this Agreement that the claimant is entitled to
indemnification, the Corporation shall be bound by such determination in any
judicial proceeding commenced pursuant to this Section 12.
 
13.    Subrogation.    In the event of payment under this Agreement, the
Corporation shall be subrogated to the extent of such payment to all of the
rights of recovery of Agent, who shall execute all documents required and shall
do all acts that may be necessary to secure such rights and to enable the
Corporation effectively to bring suit to enforce such rights.
 
14.    Liability Insurance.    To the extent the Corporation maintains liability
insurance applicable to directors, officers, employees, agents or fiduciaries,
Agent shall be covered by such policies in such a manner as to provide Agent the
same rights and benefits as are accorded to the most favorably insured of the
Corporation’s directors, if Agent is a director; or of the Corporation’s
officers, if Agent is not a director of the Corporation but is an officer; or of
the Corporation’s key employees, agents or fiduciaries, if Agent is not an
officer or director but is a key employee, agent or fiduciary.
 
15.    Non-Exclusivity of Rights.    The rights conferred on Agent by this
Agreement shall not be exclusive of any other right which Agent may have or
hereafter acquire under any statute, provision of the Corporation’s Certificate
of Incorporation or Bylaws, agreement, vote of stockholders or directors, or
otherwise, both as to action in h     official capacity and as to action in
anothercapacity while holding office.

5

--------------------------------------------------------------------------------

 
16.    Definitions.    For purposes of this Agreement, the following definitions
shall apply:
 
(a)  The term “Proceeding” shall be broadly construed and shall include, without
limitation, the investigation, preparation, prosecution, defense, settlement,
arbitration and appeal of, the giving of testimony in and participating in any
threatened, pending or completed action, suit, proceeding or alternative dispute
resolution mechanism, whether civil, criminal, arbitrational, administrative or
investigative.
 
(b)  The term “Expenses” shall be broadly construed and shall include, without
limitation, court costs, attorneys’ fees, witness fees, fines, penalties,
amounts paid in settlement or judgment and any other costs and expenses of any
nature or kind incurred in connection with any Proceeding.
 
(c)  The term the “Corporation” shall include, in addition to the resulting
corporation, any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger which, if its separate
existence had continued, would have the power and authority to indemnify its
directors, officers, and employees or agents, so that any person who is or was a
director, officer, employee or agent of such constituent corporation, or is or
was serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint venture,
trust or other enterprise, shall stand in the same position under the provisions
of this Agreement with respect to the resulting or surviving corporation as he
would have with respect to such constituent corporation if its separate
existence had continued.
 
(d)  References to a “director,” “ officer,” “employee,” or “agent” of the
Corporation shall include, without limitation, situations where such person is
serving at the request of the Corporation as a director, officer, employee,
trustee or agent or another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise.
 
(e)  References to “fines” shall include any excise taxes assessed on a person
with respect to an employee benefit plan; and references to “serving at the
request of the Corporation” shall include any service as a director, officer,
employee or agent of the Corporation which imposes duties on, or involves
services by, such director, officer, employee or agent with respect to an
employee benefit plan, its participants, or beneficiaries.
 
(f)  The “Reviewing Party” shall be that party as determined pursuant to Section
42(d)(ii) of the Corporation’s Bylaws.
 
17.    Survival of Rights.
 
(a)  The rights conferred on Agent by this Agreement shall continue after Agent
has ceased to be a director, officer, employee or other agent of the Corporation
or to serve at the request of the Corporation as a director, officer, employee
or other agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise and shall inure to the benefit of
Agent’s heirs, executors and administrators.

6

--------------------------------------------------------------------------------

 
(b)  The Corporation shall require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business or assets of the Corporation, expressly to assume and agree to perform
this Agreement in the same manner and to the same extent that the Corporation
would be required to perform if no such succession had taken place.
 
18.    Severability.    Each of the provisions of this Agreement is a separate
and distinct agreement and independent of the others, so that if any provision
hereof shall be held to be invalid for any reason, such invalidity or
unenforceability shall not affect the validity or enforceability of the other
provisions hereof. Furthermore, if this Agreement shall be invalidated in its
entirety on any ground, then the Corporation shall nevertheless indemnify Agent
to the fullest extent provided by the Bylaws, Delaware Law or any other
applicable law.
 
19.    Governing Law.    This Agreement shall be interpreted 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 the conflict of law principles thereof.
 
20.    Amendment and Termination.    No amendment, modification, termination or
cancellation of this Agreement shall be effective unless in writing signed by
both 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.
 
21.    Identical 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 but one and the same Agreement. Only
one such counterpart need be produced to evidence the existence of this
Agreement.
 
22.    Headings.    The headings of the sections of this Agreement are inserted
for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction hereof.
 
23.    Notices.    All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given (i)
upon delivery if delivered by hand to the party to whom such communication was
directed or (ii) upon the third business day after the date on which such
communication was mailed if mailed by certified or registered mail with postage
prepaid:
 
(a)  If to Agent, at the address indicated on the signature page hereof.
 
(b)  If to the Corporation, to
 
Exar Corporation
48720 Kato Road
Fremont, California 94538
Attention: Legal Department

7

--------------------------------------------------------------------------------

or to such other address as may have been furnished to Agent by the Corporation.
 
[Remainder of page intentionally left blank]

8

--------------------------------------------------------------------------------

 
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and as of
the day and year first above written.
 
EXAR CORPORATION
 
By
Title:

 
 
AGENT

--------------------------------------------------------------------------------

(name, title)

 
 
Agent Print Name and Address:

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

9