Exhibit
      10.31

     

    FORM
      OF

    INDEMNIFICATION
      AGREEMENT

    


    THIS
      AGREEMENT (the "Agreement") is made and entered into this ___ day of
      _________,____ between Fiberstars, Inc., a Delaware corporation (the
      "Corporation"), and _____________ ("Indemnitee").

    


    WHEREAS,
      Indemnitee, a director, officer, employee or agent of the Corporation (or
      serving at the request of the Corporation as a director, officer, employee
      or
      agent of another corporation, partnership, joint venture, trust, employee
      benefit plan or other enterprise) (“Agent”), performs a valuable service in such
      capacity for the Corporation;

    


    [WHEREAS,
      the Indemnitee was formerly a director, officer, employee or agent of the
      Corporation (or serving at the request of the Corporation as a director,
      officer, employee or agent of another corporation, partnership, joint venture,
      trust, employee benefit plan or other enterprise) of Fiberstars, Inc., a
      California corporation which was merged with and into the Corporation
      (“Fiberstars California”), and was party to an Indemnification Agreement with
      Fiberstars California; and] 

    


    WHEREAS,
      the Certificate of Incorporation and Bylaws of the Corporation authorize and
      permit contracts between the Corporation and its Agents with respect to
      indemnification of such Agents;

    


    WHEREAS,
      Section 145 (“Section 145”) of the General Corporation Law of Delaware (the
“DCL”) under which the Corporation is organized, empowers the Corporation to
      indemnify its directors, officers, employees by agreement and to indemnify
      persons who serve, at the request of the Corporation, as the directors,
      officers, employees or directors of other corporations or enterprises, and
      expressly provides that the indemnification provided by Section 145 is not
      exclusive;

    


    WHEREAS,
      in accordance with the provisions of the DCL, the Corporation may purchase
      and
      maintain a policy or policies of Directors and Officers Liability Insurance
      ("D
& O Insurance"), covering certain liabilities which may be incurred by
      Indemnitee in his or her performance as a director or officer of the
      Corporation; and

    


    WHEREAS,
      as a result of developments affecting the terms, scope and availability of
      D
& O Insurance there exists general uncertainty as to the extent of
      protection afforded directors and officers by such D & O Insurance and by
      statutory and bylaw indemnification provisions,

    


    NOW,
      THEREFORE, in consideration of Indemnitee's service as an Agent of the
      Corporation, the parties hereto agree as follows:

    


    1.
      Indemnity
      of Indemnitee.
      The
      Corporation hereby agrees to hold harmless and indemnify Indemnitee to the
      fullest extent authorized by the provisions of the DCL, as it may be amended
      from time to time.

    


    2. Additional
      Indemnity.
      Subject
      only to the limitations set forth in Section 3 hereof, the Corporation hereby
      further agrees to hold harmless and indemnify Indemnitee:

    


    (a)
      against any and all expenses (including attorneys' fees), witness fees,
      judgments, fines and amounts paid in settlement actually and reasonably incurred
      by Indemnitee in connection with any threatened, pending or completed action,
      suit or proceeding, whether civil, criminal, administrative or investigative
      (including an action by or in the right of the Corporation) to which Indemnitee
      is, was, or at any time becomes a party, or is threatened to be made a party,
      by
      reason of the fact that Indemnitee is, was, or at any time becomes a director,
      officer, employee or agent of the Corporation, or is or was serving or at any
      time serves at the request of the Corporation as a director, officer, employee
      or 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 Indemnitee by the
      Corporation under the Certificate of Incorporation of the Corporation and the
      DCL.

    


    3. Limitations
      on Additional Indemnity.

    


    (a)
      No
      indemnity pursuant to Section 2 hereof shall be paid by the Corporation for
      any
      of the following:

    


    (i)
      except to the extent the aggregate of losses to be indemnified thereunder
      exceeds the sum of such losses for which the Indemnitee is indemnified pursuant
      to Section 1 hereof or pursuant to any D & O Insurance purchased and
      maintained by the Corporation;

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    (ii)
      in
      respect to remuneration paid to Indemnitee if it shall be determined by a final
      judgment or other final adjudication that such remuneration was in violation
      of
      law;

    


    (iii)
      on
      account of Indemnitee's acts or omissions that involve intentional misconduct
      or
      a knowing and culpable violation of law;

    


    (iv)
      in
      connection with any action, claim or proceeding (or part thereof) initiated
      by
      Indemnitee, or any action, claim or proceeding by Indemnitee against the
      Corporation (other than as permitted by Section 8) 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,
      or (iii) such indemnification is provided by the Corporation, in its sole
      discretion, pursuant to the powers vested in the Corporation under Section
      145;

    


    (v)
      on
      account of Director's conduct which is the subject of an action, suit or
      proceeding described in Section 7(c)(ii) hereof; or

    


    (vi)
      if a
      final judicial decision having jurisdiction in the matter shall determine that
      such indemnification is not lawful (and, in this respect, both the Corporation
      and Indemnitee have been advised that the Securities and Exchange Commission
      believes that indemnification for liabilities arising under the federal
      securities laws is against public policy and is, therefore, unenforceable and
      that claims for indemnification should be submitted to appropriate courts for
      adjudication).

    


    (b)
      In
      addition to those limitations set forth above in paragraph (a) of this Section
      3, no indemnity pursuant to Section 2 hereof in an action by or in the right
      of
      the Corporation shall be paid by the Corporation for any of the
      following:

    


    (i)
      on
      account of acts or omissions that Indemnitee believes to be contrary to the
      best
      interests of the Corporation or its shareholders or that involve the absence
      of
      good faith on the part of Indemnitee;

    


    (ii)
      with
      respect to any transaction from which Indemnitee derived an improper personal
      benefit;

    


    (iii)
      on
      account of acts or omissions that show a reckless disregard for Indemnitee’s
      duty to the Corporation or its shareholders in circumstances in which Indemnitee
      was aware, or should have been aware, in the ordinary course of performing
      an
      Agent’s duties, of a risk of serious injury to the Corporation or its
      shareholders;

    


    (iv)
      on
      account of acts or omissions that constitute an unexcused pattern of inattention
      that amounts to an abdication of Indemnitee’s duty to the Corporation or its
      shareholders;

    


    (v)
      in
      respect of any claim, issue or matter as to which Indemnitee shall have been
      adjudged to be liable to the Corporation in the performance of Indemnitee’s duty
      to the Corporation and its shareholders, unless and only to the extent that
      the
      court in which such proceeding is or was pending shall determine upon
      application that, in view of all the circumstances of the case, Indemnitee
      is
      fairly and reasonably entitled to indemnity for expenses and then only to the
      extent that the court shall determine;

    


    (vi)
      of
      amounts paid in settling or otherwise disposing of a pending action without
      court approval; or

    


    (vii)
      of
      expenses incurred in defending a pending action which is settled or otherwise
      disposed of without court approval.  

    


    4. Contribution.
      If the
      indemnification provided in Sections 1 and 2 hereof is unavailable by reason
      of
      a Court decision described in subsection 3(a)(vi) hereof based on grounds other
      than any of those set forth in subsections 3(a)(ii) through (v) hereof, then
      in
      respect of any threatened, pending or completed action, suit or proceeding
      in
      which the Corporation is jointly liable with Indemnitee (or would be if joined
      in such action, suit or proceeding), the Corporation shall contribute to the
      amount of expenses (including attorneys' fees), judgments, fines and amounts
      paid in settlement actually and reasonably incurred and paid or payable by
      Indemnitee in such proportion as is appropriate to reflect (i) the relative
      benefits received by the Corporation on the one hand and Indemnitee on the
      other
      hand from the transaction from which such action, suit or proceeding arose,
      and
      (ii) the relative fault of the Corporation on the one hand and of Indemnitee
      on
      the other in connection with the events which resulted in such expenses,
      judgments, fines or settlement amounts, as well as any other relevant equitable
      considerations. The relative fault of the Corporation 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, judgments,
      fines or settlement amounts. The Corporation agrees that it would not be just
      and equitable if contribution pursuant to this Section 4 were determined by
      pro
      rata allocation or any other method of allocation which does not take account
      of
      the foregoing equitable considerations.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    5. Continuation
      of Obligations.
      All
      agreements and obligations of the Corporation contained herein shall continue
      during the period Indemnitee is a director, officer, employee or agent of the
      Corporation (or is or was serving at the request of the Corporation as a
      director, officer, employee or agent of another corporation, partnership, joint
      venture, trust, employee benefit plan or other enterprise) and shall continue
      thereafter so long as Indemnitee shall be subject to any possible claim or
      threatened, pending or completed action, suit or proceeding, whether civil,
      criminal or investigative, by reason of the fact that Indemnitee was a director,
      officer, employee or agent of the Corporation (or serving at the request of
      the
      Corporation as a director, officer, employee or agent of another corporation,
      partnership, joint venture, trust, employee benefit plan or other
      enterprise).

    


    6. Notification
      and Defense of Claim.
      Not
      later than thirty (30) days after receipt by Indemnitee of notice of the
      commencement of any action, suit or proceeding, Indemnitee will, if a claim
      in
      respect thereof is to be made against the Corporation under this Agreement,
      notify the Corporation of the commencement thereof; but the omission so to
      notify the Corporation will not relieve it from any liability which it may
      have
      to Indemnitee otherwise than under this Agreement. With respect to any such
      action, suit or proceeding as to which Indemnitee notifies the Corporation
      of
      the commencement thereof:

    


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

    


    (b)
      except as otherwise provided below, to the extent that it may wish, the
      Corporation jointly with any other indemnifying party similarly notified will
      be
      entitled to assume the defense thereof, with counsel reasonably satisfactory
      to
      Indemnitee. After notice from the Corporation to Indemnitee of its election
      so
      as to assume the defense thereof, the Corporation will not be liable to
      Indemnitee under this Agreement for any legal or other expenses subsequently
      incurred by Indemnitee in connection with the defense thereof other than
      reasonable costs of investigation or as otherwise provided below. Indemnitee
      shall have the right to employ its counsel in such action, suit or 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
      Indemnitee unless (i) the employment of counsel by Indemnitee has been
      authorized by the Corporation, (ii) Indemnitee shall have reasonably concluded
      that there may be a conflict of interest between the Corporation and Indemnitee
      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
      of
      which cases the fees and expenses of Indemnitee's separate counsel shall be
      at
      the expense of the Corporation. The Corporation shall not be entitled to assume
      the defense of any action, suit or proceeding brought by or on behalf of the
      Corporation or as to which Indemnitee shall have made the conclusion provided
      for in (ii) above; and

    


    (c)
      the
      Corporation shall not be liable to indemnify Indemnitee under this Agreement
      for
      any amounts paid in settlement of any action or claim effected without its
      written consent. 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 Indemnitee without Indemnitee's written consent.
      Neither the Corporation nor Indemnitee will unreasonably withhold its consent
      to
      any proposed settlement.

    


    7. Advancement
      and Repayment of Expenses.

    


    (a)
      In
      the event that Indemnitee employs his own counsel pursuant to Section 6(b)(i)
      through (iii) above, the Corporation shall advance to Indemnitee, prior to
      any
      final disposition of any threatened or pending action, suit or proceeding,
      whether civil, criminal, administrative or investigative, any and all reasonable
      expenses (including legal fees and expenses) incurred in investigating or
      defending any such action, suit or proceeding within ten (10) days after
      receiving copies of invoices presented to Indemnitee for such expenses;
      and

    


    (b)
      Indemnitee agrees that Indemnitee will reimburse the Corporation for all
      reasonable expenses paid by the Corporation in defending any civil or criminal
      action, suit or proceeding against Indemnitee in the event and only to the
      extent it shall be ultimately determined by a final judicial decision (from
      which there is no right of appeal) that Indemnitee is not entitled, under
      applicable law, the Bylaws, this Agreement or otherwise, to be indemnified
      by
      the Corporation for such expenses.

    


    (c)
      Notwithstanding the foregoing, the Corporation shall not be required to advance
      such expenses to Indemnitee if Indemnitee (i) commences any action, suit or
      proceeding as a plaintiff unless such advance is specifically approved by a
      majority of the Board of Directors or (ii) is a party to an action, suit or
      proceeding brought by the Corporation and approved by a majority of the Board
      which alleges willful misappropriation of corporate assets by Indemnitee,
      disclosure of confidential information in violation of Indemnitee's fiduciary
      or
      contractual obligations to the Corporation, or any other willful and deliberate
      breach in bad faith of Indemnitee's duty to the Corporation or its
      shareholders.

    


    8. Enforcement.
      In the
      event Indemnitee is required to bring any action to enforce rights or to collect
      moneys due under this Agreement and is successful in such action, the
      Corporation shall reimburse Indemnitee for all of Indemnitee's reasonable fees
      and expenses in bringing and pursuing such action.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    9.
      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 Indemnitee,
      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.

    


    10. Non-Exclusivity
      of Rights.
      The
      rights conferred on Indemnitee by this Agreement shall not be exclusive of
      any
      other right which Indemnitee 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
      his official capacity and as to action in another capacity while holding
      office.

    


    11. Survival
      of Rights.
      The
      rights conferred on Indemnitee by this Agreement shall continue after Indemnitee
      has ceased to be a director, officer, employee or other agent of the Corporation
      and shall inure to the benefit of Indemnitee's heirs, executors and
      administrators.

    


    12. Severability.
      Each of
      the provisions of this Agreement is a separate and distinct agreement and
      independent of the others, so that of any provision hereof shall be held to
      be
      invalid or unenforceable for any reason, such invalidity or unenforceability
      shall not affect the validity or enforceability of the other provisions
      hereof.

    


    13. Governing
      Law.
      This
      Agreement shall be interpreted and enforced in accordance with the laws of
      the
      State of Delaware.

    


    14. Binding
      Effect.
      This
      Agreement shall be binding upon Indemnitee and upon the Corporation, its
      successors and assigns, and shall inure to the benefit of Indemnitee, his heirs,
      personal representatives and assigns and to the benefit of the Corporation,
      its
      successors and assigns. 

    


    15. Amendment
      and Termination.
      No
      amendment, modification, termination or cancellation of this Agreement shall
      be
      effective unless in writing signed by both parties hereto.

    


    16. No
      Affect on Prior Indemnity Agreement.
      Nothing
      in this Agreement shall in any way alter or diminish the obligations of
      Corporation, as successor to Fiberstars California, under any Indemnity
      Agreement between Indemnitee and Fiberstars California relating to Indemnitee’s
      service as a director, officer, employee or agent of Fiberstars California
      (or
      serving at the request of the Fiberstars California as a director, officer,
      employee or agent of another corporation, partnership, joint venture, trust,
      employee benefit plan or other enterprise).

     

    [Signatures
      on Following Page]

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

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

     

    
      	 	 	 
	 	FIBERSTARS, INC.
	 
 	 
 	 
 
	 	By	__________________________________________________
	 	Name:	__________________________________________________
	 	Title:	__________________________________________________
	 	 	 
	 	INDEMNITEE
	 	 	 
	 	 	 
	 	______________________________________________________
	 	Name:	__________________________________________________