INDEMNIFICATION AGREEMENT


 


This
Indemnification Agreement (this “Agreement”) is effective as of June 14, 2012, (the “Effective
Date”) by and between Flux Power Holdings, Inc., a Nevada corporation (the “Company”), and Chris
Anthony (“Indemnitee”) and the parties hereby agree as follows:


 


1.           Services
by Indemnitee. Indemnitee agrees to serve as a director and/or executive officer of the Company so long as he or she is duly
appointed or elected and qualified in accordance with the applicable provisions of the Articles of Incorporation and bylaws of
the Company or any subsidiary of the Company and until such time as he or she resigns or fails to stand for election or is removed
from his or her position. Indemnitee may, at any time and for any reason, resign or be removed from such position (subject to any
other contractual obligation or other obligation imposed by operation of law), in which event the Company shall have no obligation
under this Agreement to continue Indemnitee in any such position.


 


2.           Indemnification.


 


2.1           The
Company hereby agrees to hold harmless and indemnify Indemnitee against any and all Expenses incurred by reason of the fact that
Indemnitee is or was a director, officer, agent, or advisor of the Company, or is or was serving at the request of the Company
as a director, officer, employee, agent or advisor of another corporation, partnership, joint venture, trust, limited liability
company, or other entity or enterprise, but only if Indemnitee acted in good faith and in a manner he reasonably believed to be
in or not opposed to the best interest of the Company and, in the case of a criminal proceeding, had no reasonable cause to believe
that his conduct was unlawful. The termination of any Proceeding by judgment, order of the court, settlement, conviction, or upon
a plea of nolo contendere, or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith
and in a manner which he reasonably believed to be in or not opposed to the best interest of the Company, and with respect to any
criminal proceeding, shall not create a presumption that such person believed that his conduct was unlawful. The indemnification
provided herein shall be applicable whether or not negligence or gross negligence of the Indemnitee is alleged or proven. Notwithstanding
the foregoing, in the case of any Proceeding brought by or in the right of the Company, Indemnitee shall not be entitled to indemnification
for any claim, issue or matter as to which Indemnitee has been adjudged by a court of competent jurisdiction, after exhaustion
of all appeals therefrom, to be liable to the Company or for amounts paid in settlement to the Company, unless and only to the
extent that, the court in which the Proceeding was brought or another court of competent jurisdiction determines, on application,
that in view of all the circumstances, the person is fairly and reasonably entitled to indemnity for such expenses as the court
deems proper.


 


2.2          Notwithstanding
anything in this Agreement to the contrary, the Company shall not be obligated under this Agreement to continue to indemnify Indemnitee
with respect to:


 


2.2.1           the
reporting or accounting of profits made from the purchase or sale by Indemnitee of securities of the Company within the meaning
of Section 16 of the Securities Exchange Act of 1934 as amended, or similar provisions of any state statutory or common law;


 



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2.2.2           any
attempt to acquire, or obtain voting rights with respect to, at least fifty percent (50%) of the then outstanding voting stock
of the Company, whether by tender offer, proxy solicitation or otherwise, if (a) Indemnitee attempted to acquire or obtain voting
rights with respect to such stock or was or became a member of a group consisting of two (2) or more persons that had agreed (whether
formally or informally and whether or not in writing) to act together for the purpose of acquiring, obtaining voting rights with
respect, holding, voting or disposing of such stock, and (b) such attempt to acquire or obtain voting rights with respect to such
stock was not approved by a majority of the directors of the Company. For purposes of determining whether any tender offer, proxy
solicitation or other transaction constituted an attempt by Indemnitee, or a group (as described above) of which Indemnitee was
or became a member, to acquire or obtain voting rights with respect to at least fifty percent (50%) of the then outstanding voting
stock of the Company, there shall be counted toward the required number of shares of voting stock any shares which, immediately
prior to the commencement of such tender offer, proxy solicitation or other transaction, (x) were owned by Indemnitee or any member
of any such group, (y) Indemnitee or any member of any such group had the right to vote, or (z) Indemnitee or any member of any
such group had the right to acquire;


 


2.2.3           any
solicitation of proxies by Indemnitee, or by a group of which he was or became a member consisting of two or more persons that
had agreed (whether formally or informally and whether or not in writing) to act together for the purpose of soliciting proxies,
in opposition to any solicitation of proxies approved by the Company’s Board of Directors; or


 


2.2.4           any
act or omission by Indemnitee that constitutes a breach of or default under any agreement between Indemnitee and the Company.


 


2.3          Subject
to Section 3, Indemnitee shall be paid promptly by the Company all amounts necessary to effectuate the indemnity described in
Section 2.1.


 


3.           Choice
of Counsel. Indemnitee shall be entitled to employ, and be reimbursed for the fees and disbursements of, counsel separate from
that chosen by any other person or persons whom the Company is obligated to indemnify with respect to the same or any related or
similar Proceeding.


 


4.           Advancement
of Expenses.         All reasonable Expenses incurred by or on behalf of Indemnitee
shall be advanced from time to time by the Company to him within thirty (30) days after the receipt by the Company of a written
request for an advance of Expenses, whether prior to or after final disposition of a Proceeding (except to the extent that there
has been a Final Adverse Determination that Indemnitee is not entitled to be indemnified for such Expenses), including without
limitation any Proceeding brought by or in the right of the Company; provided, however, that Indemnitee shall not
be entitled to the advancement of Expenses in connection with any Proceeding relating to his termination by or resignation from
the Company or arising out of the circumstances described in Section 2.2 above. The written request for and advancement of any
and all Expenses under this paragraph shall contain reasonable detail of the Expenses incurred by Indemnitee. Indemnitee hereby
agrees to repay the Company the amounts advanced if it is ultimately determined that Indemnitee is not entitled to be indemnified
pursuant to the terms of this Agreement.


 


5.           Additional
Limitations. The foregoing indemnity and advancement of Expenses shall apply only to the extent that Indemnitee has not been
indemnified and reimbursed pursuant to such insurance as the Company may maintain for Indemnitee’s benefit, or otherwise;
provided, however, that notwithstanding the availability of such other indemnification and reimbursement, Indemnitee may claim
indemnification and advancement of Expenses pursuant to this Agreement by assigning to the Company, at its request, Indemnitee’s
claims under such insurance to the extent Indemnitee has been paid by the Company.


 


6.           Insurance
and Funding. The Company may purchase and maintain insurance to protect itself and/or Indemnitee against any Expenses in connection
with any Proceeding to the fullest extent permitted by applicable laws. The Company may create a trust fund, grant an interest
in assets or use other means (including, without limitation, a letter of credit) to ensure the payment of such amounts as may be
necessary to effect indemnification or advancement of Expenses as provided in this Agreement. If, at the time the Company receives
notice from any source of a Proceeding as to which Indemnitee is a party or a participant (as a witness or otherwise), the Company
has director and officer liability insurance in effect, the Company shall give prompt notice of such Proceeding to the insurers
in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable
action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such Proceeding in accordance
with the terms of such policies.


 



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7.           Procedure
for Determination of Entitlement to Indemnification.


 


7.1         Whenever
Indemnitee believes that he is entitled to indemnification pursuant to this Agreement (other than pursuant to Section 4 above),
Indemnitee shall submit a written request for indemnification to the Company. Any request for indemnification shall include sufficient
documentation or information reasonably available to Indemnitee to support his claim for indemnification. Indemnitee shall submit
his claim for indemnification within a reasonable time not to exceed five (5) years after any judgment, order, settlement, dismissal,
arbitration award, conviction, acceptance of a plea of nolo contendre or its equivalent, final termination or other disposition
or partial disposition of any Proceeding, whichever is the later date for which Indemnitee requests indemnification. The president
or the secretary or other appropriate officer of the Company shall, promptly upon receipt of Indemnitee’s request for indemnification,
advise the Board of Directors of the Company in writing that Indemnitee has made such request. Determination of Indemnitee’s
entitlement to indemnification shall be made not later than sixty (60) days after the Company’s receipt of the written request
for such indemnification. If no determination has been made in such 60-day period, the Company shall be deemed to have approved
the request.


 


7.2         The
Indemnitee shall be entitled to select the forum in which Indemnitee’s request for indemnification will be heard, which selection
shall be included in the written request for indemnification required in Section 7.1 above. The forum shall be any one of the following:


 


7.2.1           The
stockholders of the Company;


 


7.2.2           A
quorum of the Board of Directors consisting of Disinterested Directors; or


 


7.2.3           Independent
Legal Counsel, who shall make the determination in a written opinion.


 


7.3         Upon
making a request for indemnification, Indemnitee shall be presumed to be entitled to indemnification under this Agreement
and the Company shall have the burden of proof to overcome that presumption in reaching any contrary determination. The
termination of any Proceeding by judgment, order, settlement, arbitration award or conviction, or upon a plea of nolo
contendre or its equivalent shall not affect this presumption or, except as provided in Section 2 or 5 hereof, establish a
presumption with regard to any factual matter relevant to determining Indemnitee’s rights to indemnification
hereunder.


 


7.4         The
Company agrees to pay the reasonable fees and expenses of Independent Legal Counsel should such counsel be retained to make
a determination of Indemnitee’s entitlement to indemnification pursuant to Section 7 of this Agreement, and to fully
indemnify such counsel or by any of them arising out of or relating to this Agreement or their engagement pursuant hereto,
except with respect to expenses and losses resulting from the negligence or willful misconduct of such counsel.


 


8.           Undertaking
By Indemnitee. Indemnitee hereby undertakes to repay to the Company any advances of Expenses pursuant to this Agreement to
the extent that it is ultimately determined that Indemnitee is not entitled to indemnification.


 



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9.           Remedies
of Indemnitee.


 


9.1           In
the event that (i) a determination pursuant to Section 7 hereof is made that Indemnitee is not entitled to indemnification, (ii)
advances of Expenses are not made pursuant to this Agreement, (iii) payment has not been timely made following a determination
of entitlement to indemnification pursuant to this Agreement, or (iv) Indemnitee otherwise seeks enforcement of this Agreement,
Indemnitee shall be entitled to a final adjudication in any court of competent jurisdiction of his rights. The Company shall not
oppose Indemnitee’s right to indemnification under this Agreement and the Company shall have the burden of proof to overcome
that presumption.


 


9.2           In
the event that a determination that Indemnitee is not entitled to indemnification, in whole or in part, has been made
pursuant to Section 7 hereof, the decision in the judicial proceeding provided in Section 9.1 shall be made de novo and
Indemnitee shall not be prejudiced by reason of a determination that he or she is not entitled to indemnification.


 


9.3           If
a determination that Indemnitee is entitled to indemnification has been made pursuant to Section 7 hereof or otherwise
pursuant to the terms of this Agreement, the Company shall be bound by such determination in the absence of (i)
misrepresentation of a material fact by Indemnitee or (ii) a specific finding (which has become final) by a court of
competent jurisdiction that all or any part of such indemnification is expressly prohibited by Nevada law.


 


10.         Modification,
Waiver, Termination, and Cancellation. No supplement, modification, termination, cancellation or amendment of this Agreement
shall be binding unless executed in writing by the parties hereto. No waiver of any of the provisions of this Agreement shall be
deemed or shall constitute a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a
continuing waiver.


 


11.         Notice
by Indemnitee and Defense of Claim. Indemnitee shall promptly notify the Company in writing upon being served with any summons,
citation, subpoena, complaint, indictment, information or other document relating to any matter, whether civil, criminal, administrative
or investigative, but the omission to notify the Company will not relieve it from any liability which it may have to Indemnitee
if such omission does not prejudice the Company’s rights. If such omission does prejudice the Company’s rights, the
Company will be relieved from liability only to the extent of such prejudice, and such omission shall not relieve the Company from
any liability which it may have to Indemnitee otherwise than under this Agreement.


 


12.         Settlement
of Claims. 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 written consent. The Company shall not settle any Proceeding
in any manner which would impose any penalty or limitation on Indemnitee's rights under this Agreement without Indemnitee's written
consent. Neither the Company nor Indemnitee will unreasonably withhold its or his consent to any proposed settlement. The Company
shall not be liable to indemnify Indemnitee under this Agreement with regard to any judicial award if the Company was not given
a reasonable and timely opportunity, at its expense, to participate in the defense of such action.


 


13.         Continuation
Of Indemnity. All agreements and obligations of the Company contained herein shall continue during the period Indemnitee is
a director, officer, agent, or advisor of the Company (or is or was serving at the request of the Company as a director, officer,
employee, agent, or advisor of another corporation, partnership, joint venture, trust, limited liability company, or other enterprise)
and shall continue thereafter so long as Indemnitee shall be subject to any possible Proceeding.


 



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14.        Partial
Indemnification. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some
or a portion of Expenses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for
the portion of such Expenses to which Indemnitee is entitled.


 


15.        Notices.
All notices, requests, demands, and other communications hereunder shall be in writing and shall be deemed to have been duly given
if delivered personally or by overnight courier such as Federal Express, or sent by certified or registered mail with postage prepaid,
addressed as:


 


	 	If to Indemnitee, to:	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	If to the Company, to:	 	2240 Auto Park Way	 
	 	 	 	Escondido, California 92029	 
	 	 	 	Attn: President	 
	 	 	 	 	 
	 	With a copy to:	 	John P. Yung, Esq.	 
	 	 	 	Locke Lord LLP	 
	 	 	 	500 Capitol Mall, Ste 1800	 
	 	 	 	Sacramento, CA 95814	 


 


or to such other address as may have been
furnished to Indemnitee by the Company or to the Company by Indemnitee, as the case may be. Notices given as set forth herein shall
be conclusively deemed to have been received by the party to whom addressed upon receipt, if delivered personally or by overnight
courier, and three business days after the same is deposited in the United States mail if sent by certified or registered mail.


 


16.         Non-exclusivity.
The indemnification and advancement of Expenses provided by this Agreement shall not be deemed exclusive of any other rights to
which Indemnitee may be entitled under the Articles of Incorporation or Bylaws, the Chapter 78 of the Nevada Revised Statutes,
any policy or policies of directors' and officers' liability insurance, any agreement, or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office. However, Indemnitee shall reimburse the Company for amounts
paid to him under this Agreement in an amount equal to any payments received pursuant to such other rights to the extent such payments
duplicate any payments received pursuant to this Agreement.


 


17.         Certain
Definitions.


 


17.1         “Disinterested
Director” shall mean a director of the Company who is not or was not a party to the Proceeding in respect of which indemnification
is being sought by Indemnitee.


 


17.2         “Expenses”
shall include, without limitation, any judgments, fines, and penalties against Indemnitee in connection with a Proceeding; amounts
paid by Indemnitee in settlement of a Proceeding; and all attorneys' fees and disbursements, accountants' fees and disbursements,
private investigation fees and disbursements, retainers, court costs, transcript costs, fees of experts, fees and expenses of witnesses,
travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and all other
disbursements or expenses reasonably incurred by or for Indemnitee in connection with prosecuting, defending, preparing to prosecute
or defend, investigating, or being or preparing to be a witness in a Proceeding or establishing Indemnitee's right or entitlement
to indemnification for any of the foregoing.


 



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17.3         “Final
Adverse Determination” shall mean that a determination that Indemnitee is not entitled to indemnification shall
have been made pursuant to Section 7 hereof and either (i) a final adjudication in a court of competent jurisdiction pursuant
to Section 9.1 hereof shall have denied Indemnitee’s right to indemnification hereunder, or (ii) Indemnitee shall have
failed to file a complaint in a court of competent jurisdiction pursuant to Section 9.1 for a period of one hundred twenty
(120) days after the determination made pursuant to Section 7


hereof.


 


17.4         “Independent
Legal Counsel” shall mean a law firm or a member of a law firm selected by the Company and approved by Indemnitee (which
approval shall not be unreasonably withheld) and that neither is presently nor in the past five years has been retained to represent:
(i) the Company or any of its subsidiaries or affiliates, or Indemnitee or any corporation as to which Indemnitee was or is a director,
officer, employee or agent, or any subsidiary or affiliate of such a corporation, in any material matter, or (ii) any other party
to the Proceeding giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term Independent Legal
Counsel shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a
conflict of interest in representing the Company or Indemnitee in an action to determine Indemnitee’s right to indemnification
under this Agreement.


 


17.5         “Proceeding”
shall include any threatened, pending, or completed action, suit, or proceeding, whether brought
by or in the right of the Company or otherwise and whether of a civil, criminal, administrative, or investigative nature, in which
Indemnitee was, is, or will be involved as a party, as a witness, or otherwise, by reason of the fact that Indemnitee is or was
a director, officer, agent, or advisor of the Company, by reason of any action taken by him or of any inaction on his part while
acting as a director, officer, agent, or advisor of the Company, or by reason of the fact that he is or was serving at the request
of the Company as a director, officer, employee, agent, or advisor of another corporation, partnership, joint venture, trust, limited
liability company, or other entity or enterprise, in each case whether or not he is acting or serving in any such capacity at the
time any liability or expense is incurred for which indemnification or reimbursement can be provided under this Agreement; provided,
that any such action which is brought by Indemnitee to enforce his rights under this Agreement shall not be a Proceeding without
prior approval of a majority of the board of directors of the Company.


 


18.         Binding
Effect. This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns (including any direct or indirect successor by purchase, merger, consolidation or otherwise to
all or substantially all of the business or assets of the Company), spouses, heirs and personal and legal representatives.


 


19.         Severability.
If any provision(s) of this Agreement (or any portion thereof) shall be held to be invalid, illegal or unenforceable for any reason
whatsoever, (i) the validity, legality and enforceability of the remaining provisions of this Agreement shall not in any way be
affected or impaired thereby; and (ii) to the fullest extent legally possible, the provisions of this Agreement shall be construed
so as to give effect to the intent of any provision held invalid, illegal or unenforceable.


 


20.         Applicable
Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Nevada, without
regard to its conflict of laws rules.


 


21.         Attorneys
Fees. In any proceeding brought to enforce any provision of this Agreement, or to seek damages for a breach of any provision
hereof, or when any provision hereof is validly asserted as a defense, the prevailing party shall be entitled to receive from the
other party all reasonable attorneys fees and costs in connection therewith.


 



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22.         Entire
Agreement. This Agreement represents the entire agreement between the parties hereto, and there are no other agreements, contracts
or understandings between the parties hereto with respect to the subject matter of this Agreement, except as specifically referred
to herein or as provided in Section 16 hereof.


 


23.         Amendments,
Termination and Waiver. No supplement, modification, amendment or termination of this Agreement shall be binding unless executed
in writing by the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver
of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.


 


24.         Counterparts.
This Agreement may be executed in one or more counterparts (including facsimile), each of which shall be deemed an original and
all of which together shall constitute one and the same Agreement.


 


25.         Subrogation.
In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights
of recovery of Indemnitee, who shall execute all papers required and shall do everything that may be necessary to secure such rights,
including the execution of such documents necessary to enable the Company effectively to bring suit to enforce such rights.


 


26.         No
Duplication of Payments. The Company shall not be liable under this Agreement to make any payment in connection with any Proceeding
made against Indemnitee to the extent Indemnitee has otherwise actually received payment (under insurance policy, Articles of Incorporation
or otherwise) of the amounts otherwise identifiable hereunder.


 


27.         Contribution.
If the indemnification provided in Section 2 is unavailable, then, in respect of any Proceeding in which the Company is jointly
liable with Indemnitee (or would be if joined in the Proceeding), the Company shall contribute to the amount of Expenses, judgments,
fines, penalties and amounts paid in settlement as appropriate to reflect: (i) the relative benefits received by the Company,
on the one hand, and Indemnitee, on the other hand, from the transaction from which the Proceeding arose, and (ii) the relative
fault of the Company, on the one hand, and of Indemnitee, on the other, in connection with the events which resulted in such Expenses,
judgments, fines, penalties and amounts paid in settlement, as well as any other relevant equitable considerations. The relative
fault of the Company, on the one hand, and of Indemnitee, on the other, shall be determined by reference to, among other things,
the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent the circumstances resulting
in such Expenses. The Company agrees that it would not be just and equitable if contribution pursuant to this Section 27 were
determined by pro rata allocation or any other method of allocation which does not take account of the equitable considerations
described in this Section 27.


 


[Signatures on following page]


 



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


 


	 	COMPANY
	 	 
	 	Flux Power Holdings, Inc.
	 	 
	 	 
	 	By:	 
	 	Name: 	 
	 	 	 
	 	INDEMNITEE
	 	 	 
	 	 	 
	 	Name:	Chris
Anthony


 



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