**Exhibit 10.2**

**INDEMNIFICATION AGREEMENT**

This Indemnification Agreement (“Agreement”) is madeas of November, 8, 2004 by and between American States Water Company, aCalifornia corporation (“Company”), and (“Indemnitee”).

**R E C I T A L S**

A.            TheIndemnitee is currently serving as a director of the Company and SouthernCalifornia Water Company, a California corporation, American States UtilityServices, Inc., a California corporation, Chaparral City Water Company, anArizona corporation, Fort Bliss Water Services Company, a Texas corporation,and California Cities Water Company. Inc., a California corporation, each awholly-owned subsidiary of the Company, and in such capacities has renderedvaluable services to the Company.

B.            TheCompany has investigated the availability and sufficiency of liabilityinsurance and California statutory indemnification provisions to provide thedirectors and officers of the Company and the directors and officers of itswholly owned subsidiaries with adequate protection against various legal risksand potential liabilities to which such individuals are subject due to theirpositions with the Company and/or its wholly owned subsidiaries and hasconcluded that such insurance and statutory provisions may provide inadequateand unacceptable protection to certain individuals requested to serve asdirectors and/or officers of the Company and/or its wholly owned subsidiaries.

C.            Inorder to induce and encourage highly experienced and capable persons such asthe Indemnitee to continue to serve as a director of the Company and each ofits wholly owned subsidiaries, the Board of Directors has determined, after dueconsideration and investigation of the terms and provisions of this Agreementand the various other options available to the Company and the Indemnitee inlieu hereof, that this Agreement is not only reasonable and prudent butnecessary to promote and ensure the best interests of the Company and itsshareholders.

**AGREEMENT**

**NOW, THEREFORE**,in consideration of the continued services of the Indemnitee and in order toinduce the Indemnitee to continue to serve as a director of the Company andSouthern California Water Company, a California corporation, American StatesUtility Services, Inc., a California corporation, Chaparral City Water Company,an Arizona corporation, Fort Bliss Water Services Company, a Texas corporation,and California Cities Water Company. Inc., a California corporation,, theCompany and the Indemnitee do hereby agree as follows:

1.             **Definitions**.  As used in this Agreement:

(a)           Theterm “Proceeding” shall include any threatened, pending or completed action,suit or proceeding, formal or informal, whether brought in the name of theCompany or one of its wholly owned subsidiaries or otherwise and whether of acivil,

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criminal or administrative or investigative nature,against the Indemnitee by reason of the fact that the Indemnitee is or was adirector and/or officer of the Company, or is or was serving at the request ofthe Company as a director, officer, employee or agent of another corporation,partnership, joint venture, trust or other enterprise, including, withoutlimitation, any subsidiary or affiliated company, whether or not the Indemniteeis serving in such capacity at the time any liability or Expense is incurred forwhich indemnification or reimbursement is to be provided under this Agreement.

(b)           Theterm “change of control” includes any change in the ownership of a majority ofthe outstanding voting securities of the Company or in the composition of amajority of the members of the board of directors of the Company.

(c)           Theterm “Expenses” includes, without limitation, attorneys’ fees, disbursementsand retainers, accounting and witness fees, travel and deposition costs,expenses of investigations, judicial or administrative proceedings and appeals,amounts paid in settlement by or on behalf of Indemnitee, and any expenses ofestablishing a right to indemnification, pursuant to this Agreement orotherwise, including reasonable compensation for time spent by the Indemniteein connection with the investigation, defense or appeal of a Proceeding oraction for indemnification for which the Indemnitee is not otherwisecompensated by the Company or any third party. The term “Expenses” does not include the amount of judgments, fines,penalties or ERISA excise taxes actually levied against the Indemnitee.

(d)           Theterm “fines” shall include any excise taxes assessed on Indemnitee with respectto any employee benefit plan.

(e)           Theterm “serving at the request of the Company” includes any service, at therequest or with the express or implied authorization of the Company, as adirector, officer, employee or agent of another corporation, partnership, jointventure, trust or other enterprise, which service imposes duties on, or involvesservices by, Indemnitee with respect to such corporation, partnership, jointventure, trust or other enterprise, its participants or beneficiaries.  If Indemnitee acted in good faith and in amanner Indemnitee reasonably believed to be in or not opposed to the bestinterests of such other enterprise, its participants or beneficiaries,Indemnitee shall be deemed to have acted in a manner not opposed to the bestinterests of the Company.

2.             **Agreement to Serve**.  In reliance on this Agreement, the Indemniteeagrees to continue to serve as a director and/or officer of the Company and/orone or more its wholly owned subsidiaries for so long as the Indemnitee is dulyelected or appointed or until such time as the Indemnitee tenders theIndemnitee’s resignation in writing or is removed from all positions as adirector and/or officer of the Company and/or its wholly owned subsidiaries.

3.             **Indemnification in Third Party Actions**.  The Company shall indemnify the Indemnitee ifthe Indemnitee is a party to or threatened to be made a party to or isotherwise involved in any Proceeding (other than a Proceeding by or in the nameof the Company to procure a judgment in its favor), by reason of the fact thatthe Indemnitee is or was a director 

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and/or officer of the Company, or is or was serving atthe request of the Company as a director, officer, employee or agent of anothercorporation, partnership, joint venture, trust or other enterprise, including,without limitation, any subsidiary or affiliated company, against all Expenses,judgments, fines, penalties and ERISA excise taxes actually and reasonablyincurred by the Indemnitee in connection with the defense or settlement of sucha Proceeding, to the fullest extent permitted by California law and the Company’sArticles of Incorporation and Bylaws; provided that any settlement of aProceeding be approved in writing by the Company.

4.             **Indemnification in Proceedings By or In the Nameof the Company**.  TheCompany shall indemnify the Indemnitee if the Indemnitee is a party to orthreatened to be made a party to or is otherwise involved in any Proceeding byor in the name of the Company to procure a judgment in its favor by reason ofthe fact that the Indemnitee was or is a director and/or officer of theCompany, or is or was serving at the request of the Company as a director,officer, employee or agent of another corporation, partnership, joint venture,trust or other enterprise, against all Expenses, judgments, fines, penaltiesand ERISA excise taxes actually and reasonably incurred by the Indemnitee inconnection with the defense or settlement of such a Proceeding, to the fullestextent permitted by applicable law and the Company’s Articles of Incorporationand Bylaws.

5.             **Conclusive Presumption Regarding Standards of Conduct**.  The Indemnitee shall be conclusively presumedto have met the relevant standards of conduct, if any, as defined by Californialaw, for indemnification pursuant to this Agreement, unless a determination ismade that the Indemnitee has not met such standards (i) by the Board ofDirectors by a majority vote of a quorum thereof consisting of directors whowere not parties to the Proceeding for which a claim is made under thisAgreement, (ii) by the shareholders of the Company by majority vote of a quorumthereof consisting of shareholders who are not parties to the Proceeding due towhich a claim is made under this Agreement, (iii) in a written opinion byindependent counsel, the selection of whom has been approved by the Indemniteein writing, or (iv) by a court of competent jurisdiction.

6.             **Indemnification of Expenses of Successful Party**.  Notwithstanding any other provision of thisAgreement, to the extent that the Indemnitee has been successful in defense ofany Proceeding or in defense of any claim, issue or matter therein, on themerits or otherwise, including the dismissal of a Proceeding without prejudiceor the settlement of a Proceeding without an admission of liability, theIndemnitee shall be indemnified against all Expenses incurred in connectiontherewith to the fullest extent permitted by applicable law.

7.             **Advances of Expenses**.  The Expenses incurred by the Indemnitee inany Proceeding shall be paid promptly by the Company in advance of the finaldisposition of the Proceeding at the written request of the Indemnitee to thefullest extent permitted by applicable law; provided that the Indemnitee shallundertake in writing to repay any advances if it is ultimately determined thatthe Indemnitee is not entitled to indemnification by the Company.

8.             **Partial Indemnification**.  If the Indemnitee is entitled under anyprovision of this Agreement to indemnification by the Company for a portion ofthe Expenses, judgments, fines, penalties or ERISA excise taxes actually andreasonably incurred by the Indemnitee in the

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investigation, defense, appeal or settlement of anyProceeding but not, however, for the total amount of the Indemnitee’s Expenses,judgments, fines, penalties or ERISA excise taxes, the Company shallnevertheless indemnify the Indemnitee for the portion of Expenses, judgments,fines, penalties or ERISA excise taxes to which the Indemnitee is entitled.

9.             **Indemnification Procedure; Determination of Rightto Indemnification**.

(a)           Promptlyafter receipt by the Indemnitee of notice of the commencement of anyProceeding, the Indemnitee shall, if a claim in respect thereof is to be madeagainst the Company under this Agreement, notify the Company of thecommencement thereof in writing.  Theomission to so notify the Company will relieve the Company of any liabilitywhich it may have to the Indemnitee under this Agreement only if the Company isprejudiced by such omission, but will not relieve the Company from anyliability which it may have to the Indemnitee otherwise than under thisAgreement.

(b)           Ifa claim for indemnification or advances under this Agreement is not paid by theCompany within 30 days of receipt of written notice, the rights provided bythis Agreement shall be enforceable by the Indemnitee in any court of competentjurisdiction.  The burden of proving byclear and convincing evidence that indemnification or advances are notappropriate shall be on the Company. Neither the failure of the directors or shareholders of the Company orits independent legal counsel to have made a determination prior to thecommencement of such action that indemnification or advances are proper in thecircumstances because the Indemnitee has met the applicable standard ofconduct, if any, nor an actual determination by the directors or shareholdersof the Company or independent legal counsel that the Indemnitee has not met theapplicable standard of conduct, shall be a defense to the action or create apresumption for the purpose of an action that the Indemnitee has not met theapplicable standard of conduct.

(c)           TheIndemnitee’s Expenses incurred in connection with any proceeding concerning theIndemnitee’s right to indemnification or advances in whole or in part pursuantto this Agreement shall also be indemnified by the Company, regardless of theoutcome of such action, suit or proceeding.

(d)           Withrespect to any Proceeding for which indemnification is requested, the Companywill be entitled to participate therein at its own expense and, except asotherwise provided below, to the extent that it may wish, the Company mayassume the defense thereof, with counsel satisfactory to the Indemnitee.  After notice from the Company to theIndemnitee of its election to assume the defense of a Proceeding, the Companywill not be liable to the Indemnitee under this Agreement for any Expensessubsequently incurred by the Indemnitee in connection with the defense thereof,other than as provided below.  TheCompany shall not settle any Proceeding in any manner which would impose anypenalty or limitation on the Indemnitee without the Indemnitee’s writtenconsent.  The Indemnitee shall have theright to employ the Indemnitee’s own counsel in any Proceeding, but the feesand expenses of such counsel incurred after notice from the Company of itsassumption of the defense of the

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Proceeding shall be at the expense of the Indemnitee,unless (i) the employment of counsel by the Indemnitee has been authorized bythe Company, (ii) the Indemnitee shall have reasonably concluded that there maybe a conflict of interest between the Company and the Indemnitee in the conductof the defense of a Proceeding, or (iii) the Company shall not in fact haveemployed counsel to assume the defense of a Proceeding, in each of which casesthe fees and expenses of the Indemnitee’s counsel shall be advanced by theCompany.  The Company shall not beentitled to assume the defense of any Proceeding brought by or on behalf of theCompany or as to which the Indemnitee has concluded that there may be aconflict of interest between the Company and the Indemnitee.

10.           **Limitations on Indemnification**.  The Company shall make no payments pursuantto this Agreement:

(a)           Toindemnify or advance funds to the Indemnitee for Expenses with respect toProceedings initiated or brought voluntarily by the Indemnitee and not by wayof defense, except with respect to Proceedings brought to establish or enforcea right to indemnification under this Agreement or any other statute or law orotherwise as required under California law, but such indemnification oradvancement of expenses may be provided by the Company in specific cases if theBoard of Directors finds it to be appropriate;

(b)           Toindemnify the Indemnitee for any Expenses, judgments, fines, penalties or ERISAexcise taxes sustained in any Proceeding for which payment is actually made tothe Indemnitee under a valid and collectible insurance policy, except inrespect of any excess beyond the amount of payment under such insurance;

(c)           Toindemnify the Indemnitee for any Expenses, judgments, fines or penaltiessustained in any Proceeding for an accounting of profits made from the purchaseor sale by the Indemnitee of securities of the Company pursuant to theprovisions of Section 16(b) of the Securities Exchange Act of 1934, the rulesand regulations promulgated thereunder and amendments thereto or similarprovisions of any federal, state or local statutory law;

(d)           Ifa court of competent jurisdiction finally determines that any indemnificationhereunder is unlawful;

(e)           Toindemnify the Indemnitee for any Expenses based upon or attributable to theIndemnitee gaining in fact any personal profit or advantage to which theIndemnitee was not legally entitled; and

(f)            Toindemnify the Indemnitee for any Expenses brought about or contributed to bythe dishonesty of the Indemnitee seeking payment hereunder; however,notwithstanding the foregoing, the Indemnitee shall be protected under thisAgreement to the fullest extent permitted under law as to any claims upon whichsuit may be brought against the Indemnitee by reason of any alleged dishonestyon the Indemnitee’s part, unless a judgment or other final adjudication thereofadverse to the Indemnitee shall

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establish that the Indemnitee committed (i) acts ofactive and deliberate dishonesty (ii) with actual dishonest purpose and intent,which acts were material to the cause of action so adjudicated.

11.           **Maintenance of Liability Insurance**.

(a)           TheCompany hereby covenants and agrees that, as long as the Indemnitee continuesto serve as a director and/or officer of the Company and/or any wholly ownedsubsidiary and thereafter as long as the Indemnitee may be subject to anypossible Proceeding, the Company, subject to subsection (c) below, shallpromptly obtain and maintain in full force and effect directors’ and officers’liability insurance (“D&O Insurance”) in reasonable amounts fromestablished and reputable insurers.

(b)           Inall D&O Insurance policies, the Indemnitee shall be named as an insured insuch a manner as to provide the Indemnitee the same rights and benefits as areaccorded to the most favorably insured of the directors and officers of theCompany and its wholly owned subsidiaries.

(c)           Notwithstandingthe foregoing, the Company shall have no obligation to obtain or maintainD&O Insurance if the Company determines, in its sole discretion, that suchinsurance is not reasonably available, the premium costs for such insurance aredisproportionate to the amount of coverage provided, the coverage provided bysuch insurance is so limited by exclusions that it provides an insufficient benefit,or the Indemnitee is covered by similar insurance maintained by a subsidiary ofthe Company.  If the Company makes such adetermination, it shall notify the Indemnitee within 30 calendar days.

12.           **Indemnification Hereunder Not Exclusive**.  The indemnification provided by thisAgreement shall not be deemed exclusive of any other rights to which theIndemnitee may be entitled under the Company’s Articles of Incorporation, theCompany’s Bylaws, any agreement, vote of shareholders or disinterested directorsof the Company, provision of California law, or otherwise, both as to action inthe Indemnitee’s official capacity and as to action in another capacity onbehalf of the Company or any wholly owned subsidiary while holding such office.

13.           **Successors and Assigns**.  This Agreement shall be binding upon, andshall inure to the benefit of the Indemnitee and the Indemnitee’s heirs,executors, administrators and assigns, whether or not Indemnitee has ceased tobe a director and/or officer of the Company or any wholly owned subsidiary orany director and/or officer of any of their successors and assigns.

14.           **Merger, Consolidation or Change in Control**.  If the Company is a constituent corporationin a merger or consolidation, whether the Company is the resulting or survivingcorporation or is absorbed as a result thereof, or if there is a Change inControl of the Company, Indemnitee shall stand in the same position under thisAgreement with respect to the resulting,

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surviving or changed corporation as Indemnitee wouldhave with respect to the Company if its separate existence had continued or ifthere had been no Change in the Control of the Company.

15.           **Severability**.  Each and every paragraph, sentence, term andprovision of this Agreement is separate and distinct so that if any paragraph,sentence, term or provision hereof shall be held to be invalid or unenforceablefor any reason, such invalidity or unenforceability shall not affect thevalidity or enforceability of any other paragraph, sentence, term or provisionhereof.  To the extent required, anyparagraph, sentence, term or provision of this Agreement may be modified by acourt of competent jurisdiction to preserve its validity and to provide theIndemnitee with the broadest possible indemnification permitted underapplicable law.

16.           **Savings Clause**.  If this Agreement or any paragraph, sentence,term or provision hereof is invalidated on any ground by any court of competentjurisdiction, the Company shall nevertheless indemnify the Indemnitee as to anyExpenses, judgments, fines, penalties or ERISA excise taxes incurred withrespect to any Proceeding to the fullest extent permitted by any applicableparagraph, sentence, term or provision of this Agreement that has not beeninvalidated or by any other applicable provision of applicable law.

17.           **Interpretation; Governing Law**.  This Agreement shall be construed as a wholeand in accordance with its fair meaning. Headings are for convenience only and shall not be used in construingmeaning.  This Agreement shall begoverned and interpreted in accordance with the laws of the State ofCalifornia.

18.           **Amendments**.  No amendment, waiver, modification,termination or cancellation of this Agreement shall be effective unless inwriting signed by the party against whom enforcement is sought.  The indemnification rights afforded to theIndemnitee hereby are contract rights and may not be diminished, eliminated orotherwise affected by amendments to the Company’s Articles of Incorporation,the Company’s Bylaws or by other agreements, including directors’ and officers’liability insurance policies.

19.           **Counterparts**.  This Agreement may be executed in one or morecounterparts, all of which shall be considered one and the same agreements andshall become effective when one or more counterparts have been signed by eachparty and delivered to the other.

20.           **Notices**.  Any notice required to be given under thisAgreement shall be directed to American States Water Company, 630 East FoothillBlvd., San Dimas, California 91773 Attention: Chief Financial Officer, and toIndemnitee at the address given on the signature page hereto or to such otheraddress as either shall designate in writing.

[*Signature page to follow*]

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IN WITNESS WHEREOF, the parties have executed thisIndemnification Agreement as of the date first written above.
|        | INDEMNITEE                    |
|--------|-------------------------------|
|   |                          |
|   |                          |
|   |                          |   |   |
|   | Notice Address:               |
|   |                          |
|   |                          |
|   |                          |
|   |                          |
|   |                          |
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|   |                          |   |   |
|   | AMERICAN STATES WATER COMPANY |
|   |                          |   |   |
|   | By:                           |   |   |
|   |                          |   |   |
|   | Its:                          |   |   |

 

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