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Exhibit 10.1
 
 
 
INDEMNIFICATION AGREEMENT
 
This Indemnification Agreement is by and between Aware, Inc., a Massachusetts
corporation (“Corporation”), and ___________ (“Indemnitee”), a director or
officer of the Corporation.
 
WHEREAS, it is essential to the Corporation to retain and attract as directors
and officers the most capable persons available, and
 
WHEREAS, the Corporation is subject to the provisions of the Massachusetts
Business Corporation Act (the “Act”), and
 
WHEREAS, the By-Laws of the Corporation require the Corporation to indemnify its
officers and directors to the fullest extent permitted by law and Indemnitee has
been serving and continues to serve as a director or officer of the Corporation
in part on reliance on such By-Laws, and
 
WHEREAS, in recognition of Indemnitee’s need for substantial protection against
personal liability in order to enhance Indemnitee’s continued service to the
Corporation in an effective manner and Indemnitee’s reliance on the aforesaid
By-Laws, and in part to provide Indemnitee with specific contractual assurance
that the protection promised by such By-Laws will be available to Indemnitee
(regardless of, among other things, any amendment to or revocation of such
By-Laws or any change in the composition of the Corporation’s Board of Directors
or any acquisition transaction relating to the Corporation), the Corporation
wishes to provide in this Agreement for indemnification of Indemnitee to the
fullest extent permitted by law and as set forth in this Agreement;
 
NOW THEREFORE, for good and valuable consideration, receipt of which is hereby
acknowledged, the Corporation and Indemnitee agree as follows:
 
1.           Indemnification.  In accordance with the provisions of the Act, the
Corporation shall, to the fullest extent permitted by law, indemnify and hold
harmless Indemnitee if Indemnitee was or is or becomes a party to or witness or
other participant in, or is threatened to be made a party to or witness or other
participant in, any threatened, pending or completed action, suit, proceeding or
alternative dispute resolution proceeding, or any hearing, inquiry or
investigation that such Indemnitee in good faith believes might lead to the
institution of any such action, suit, proceeding or alternative dispute
resolution proceeding, whether civil, criminal, administrative, investigative or
other (collectively, a “Claim”) by reason of (or arising in part out of) or in
any way related to any event or occurrence related to the fact that Indemnitee
is or was (or is alleged to be or to have been) a director or officer of the
Corporation or any subsidiary of the Corporation, or is or was (or is alleged to
be or to have been) serving at the request of the Corporation as a director or
officer of another corporation, partnership, joint venture, trust or other
enterprise, or by reason of any action or inaction on the part of such
Indemnitee while serving (or allegedly serving) in such capacity, from and
against any and all losses, claims, damages, and liabilities (joint or several),
judgments, fines, and penalties of such Claim and any federal, state, local or
foreign taxes imposed on Indemnitee as a result of the actual or deemed receipt
of any payments under this Agreement incurred in connection with such Claim
(collectively, “Damages”), and any expenses, including any investigation, legal
and other expenses incurred in connection with, and any amount paid in
settlement of, any such Claim and against any and all expenses (including
attorneys’ fees and all other costs, expenses and obligations) incurred in
connection with investigating, defending a witness in or participating in
(including on appeal), or preparing to defend, be a witness in or participate
in, any action, suit, proceeding, alternative dispute resolution proceeding,
hearing, inquiry or investigation related to such Claim (collectively,
“Expenses”), including all interest, assessments and other charges paid or
payable in connection with or in respect of such Expenses.
 
 
 
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2.           Expenses; Indemnification Procedure.
 
(a)           The Corporation shall advance all reasonable Expenses incurred by
Indemnitee (or that would be incurred in the absence of this Agreement) upon the
terms specified in this Agreement, subject to receipt by the Corporation of (i)
a written affirmation of Indemnitee’s good faith belief that Indemnitee has met
the relative standard of conduct described in the Act or that the proceeding
involves conduct for which liability has been eliminated under a provision of
the Corporation’s Articles of Organization, as authorized by the Act and (ii)
Indemnitee’s written undertaking to repay such advances if it is determined he
is not entitled to them.  The advances to be made hereunder shall be paid by the
Corporation to the Indemnitee as soon as practicable but in any event no later
than ten (10) days after written demand by such Indemnitee therefor to the
Corporation, subject to the Corporation receiving the written affirmation and
written undertaking referred to in the preceding sentence.
 
(b)           For purposes of this Agreement, the termination of any Claim by
judgment, order, settlement (whether with or without court approval) or
conviction, or upon a plea of nolo contendere, or its equivalent, shall not
create a presumption that Indemnitee did not meet any particular standard of
conduct or have any particular belief or that a court has determined that
indemnification is not permitted by applicable law.  In addition, neither the
failure of the body making an indemnification decision on behalf of the
Corporation to have made a determination as to whether an Indemnitee has met any
particular standard of conduct or had any particular belief, nor an actual
determination by such body that the Indemnitee has not met such standard of
conduct or did not have such belief, prior to the commencement of legal
proceedings by Indemnitee to secure a judicial determination that the Indemnitee
should be indemnified under applicable law, shall be a defense to the
Indemnitee’s Claim or create a presumption that the Indemnitee has not met any
particular standard of conduct or did not have any particular belief.  In
connection with any determination by such body or otherwise as to whether the
Indemnitee is entitled to be indemnified hereunder, the burden of proof shall be
on the Corporation to establish that the Indemnitee is not so entitled.
 
(c)           If, at the time of the receipt by the Corporation of a notice of a
Claim from Indemnitee the Corporation has D&O Insurance (as defined below) in
effect which may cover such Claim, the Corporation shall give prompt notice of
the commencement of such Claim to the insurers in accordance with the procedures
set forth in the respective policies.  The Corporation shall thereafter take all
commercially reasonable action to cause such insurers to pay, on behalf of each
Indemnitee, all amounts payable as a result of such action, suit, proceeding,
inquiry or investigation in accordance with the terms of such policies.
 
 
 
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3.           Partial Indemnification; Contribution.
 
(a)           If Indemnitee is entitled under any provision of this Agreement to
indemnification by the Corporation for any portion of Expenses or Damages
incurred in connection with any Claim, but not, however, for all of the total
amount thereof, the Corporation shall nevertheless indemnify Indemnitee for the
portion of such Expenses or Damages to which such Indemnitee is entitled.
 
(b)           If and to the extent that a final adjudication shall specify that
the Corporation is not obligated to indemnify Indemnitee under this Agreement
for any reason in respect of any Claim, then, to the fullest extent permitted by
law, the Corporation shall contribute to the amount paid or payable by
Indemnitee as a result of such Claim in such proportion as is appropriate (i) to
reflect the relative benefits received by the Corporation, on the one hand, and
Indemnitee, on the other hand, from the action or inaction with respect to which
such Claim arose, and (ii) if the allocation provided by clause (i) is not
permitted by applicable law, in such proportion to reflect not only the relative
benefits referred to in clause (i) but also the relative fault of the
Corporation, on the one hand, and Indemnitee, on the other hand, in connection
with the circumstances that resulted in such Expenses or Damages, as well as any
other relevant equitable considerations.  The relative fault of the Corporation,
on the one hand, and Indemnitee, on the other hand, shall be determined by
reference to, among other things, whether any untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Corporation or the Indemnitee and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent the circumstances resulting in such Expenses or Damages.  The
Corporation and each Indemnitee agree that it would not be just and equitable if
contribution pursuant to this Section 3(b) were determined by pro rata or per
capita allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in this Section 3(b).
 
4.           Additional Indemnification Rights; Nonexclusivity.
 
(a)            The Corporation hereby agrees to indemnify Indemnitee to the
fullest extent permitted by law and in accordance with the terms hereof,
notwithstanding that such indemnification may not be specifically authorized by
the Corporation’s Articles of Organization, the Corporation’s By-Laws or by
statute.  In the event of any change after the date of this Agreement in any
applicable law, statute or rule which expands the right of a Massachusetts
corporation to indemnify a member of its Board of Directors, it is the intent of
the parties hereto that Indemnitee shall enjoy by this Agreement the greater
benefits afforded by such change.  In the event of any change in any applicable
law, statute or rule which narrows the right of a Massachusetts corporation to
indemnify a member of its Board of Directors, such change, to the extent not
otherwise required by such law, statute or rule to be applied to this Agreement,
shall have no effect on this Agreement or the parties’ rights and obligations
hereunder.
 
(b)           The indemnification provided by this Agreement shall be in
addition to any rights to which Indemnitee may be entitled under the
Corporation’s Articles of Organization, its By-Laws, any agreement, any vote of
shareholders or otherwise.  The indemnification provided under this Agreement
shall continue as to Indemnitee for any action Indemnitee took or did not take
while serving in an indemnified capacity even though the Indemnitee may have
ceased to serve in such capacity.
 
 
 
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(c)           So long as the Indemnitee shall continue to serve in any capacity
described in Section 1 and thereafter so long as there is any reasonable
possibility that the Indemnitee shall be subject to any Claim by reason of the
fact that the Indemnitee served in any of such capacities, the Corporation will
use reasonable efforts to purchase and maintain in effect for the benefit of the
Indemnitee one or more valid, binding and enforceable policies of directors’ and
officers’ liability insurance (“D&O Insurance”) providing, in all respects,
coverage and amounts as reasonably determined by the Board of Directors.  The
rights and benefits accorded to the Indemnitee under the D&O Insurance shall be
the same as the rights and benefits accorded to the most favorably insured of
the Corporation’s Board members.
 
5.           Attorneys’ Fees.  The Corporation shall pay for Indemnitee’s
reasonable attorneys’ fees, costs and disbursements for any action at law or in
equity necessary for Indemnitee to enforce the terms of this Indemnification
Agreement or to protect his rights obtained hereunder.
 
6.           Limitation on Indemnification.  Notwithstanding anything in this
Agreement to the contrary, Indemnitee shall not be entitled to indemnification
pursuant to this Agreement in connection with any Claim initiated by Indemnitee
against the Corporation or any director or officer of the Corporation unless (a)
the Corporation has joined in or the Board of Directors of the Corporation has
consented to the initiation of such Claim or (b) the Claim is one to enforce
Indemnitee’s rights under this Agreement.
 
7.           Successors and Assigns.  This Indemnification Agreement shall be
binding upon the Corporation and its successors and assigns, including any
direct or indirect successor by purchase, merger, consolidation or otherwise to
all or substantially all of the business and/or assets of the Corporation, and
shall inure to the benefit of the estate, heirs, executors, administrators and
personal representatives of Indemnitee.
 
8.           Applicable Law.  This Indemnification Agreement shall be governed
by and construed in accordance with the internal laws of the Commonwealth of
Massachusetts.  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, and the remaining provisions shall
remain enforceable to the fullest extent permitted by law.  Furthermore, to the
fullest extent possible, the provisions of this Agreement (including, without
limitation, each portion of this Agreement containing any provision held to be
invalid, void or otherwise unenforceable, that is not itself invalid, void or
unenforceable) shall be construed so as to give effect to the intent manifested
by the provision held invalid, illegal or unenforceable.
 
9.           Amendments.  No supplement, waiver, modification or amendment of
this Indemnification Agreement shall be effective unless executed in writing by
both of the parties hereto.
 
 
 
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10.           Prior Agreements.  This Indemnification Agreement supersedes all
prior agreements between the Corporation and Indemnitee with respect to the
subject matter herein provided, [including, without limitation, the
Indemnification Agreement dated as of [______ __, ____] by and between
Indemnitee and the Corporation.
 
In witness whereof, the parties have signed and sealed this Indemnification
Agreement this ____ day of February, 2011.
 

AWARE,
INC.                                                                                                                          
INDEMNITEE                                  

By:
_____________________________                                                                       _____________________________
       Its:                                                                                                                                       Director
or Officer
 
 
 
 
 
 
 
 
 
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