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     F. Based upon their experience as business managers, the Board of Directors of the Company(the “Board”) has concluded that, to retain and attract talented and experienced individuals toserve as directors, officers and agents of the Company and its subsidiaries and to encourage suchindividuals to take the business risks necessary for the success of the Company and itssubsidiaries, it is necessary for the Company to contractually indemnify its directors, officersand agents and the directors, officers and agents of its subsidiaries, and to assume for itselfmaximum liability for expenses and damages in connection with claims against such directors,officers and agents in connection with their service to the Company and its subsidiaries, and hasfurther concluded that the failure to provide such contractual indemnification could result ingreat harm to the Company and its subsidiaries and the Company’s shareholders.     G. Sections 204 and 317 of The California General Corporation Law, as amended (the “Code”),under which the Company is organized, empower the Company to adopt provisions in its Articles ofIncorporation to indemnify its directors, officers and other agents by Bylaw provision, agreementor otherwise and to indemnify persons who serve, at the request of the Company, as the directors,officers or agents of other corporations or enterprises. Sections 204 and 317(g) of the Codeprovide that the indemnification permitted by Section 317 of the Code is not exclusive.     H. The Company, after reasonable investigation prior to the date hereof, has determined thatthe liability insurance coverage available to the Company and its subsidiaries as of the datehereof is inadequate and/or unreasonably expensive. The Company believes, therefore, that theinterests of the Company’s shareholders would best be served by a combination of such insurance asthe Company may obtain, or request a subsidiary to obtain, pursuant to the Company’s obligationshereunder and the indemnification by the Company of the directors, officers and agents of theCompany and its subsidiaries.     I. The Company desires and has requested the Indemnitee to serve or continue to serve as adirector, officer or agent of the Company and/or one or more subsidiaries of the Company free fromundue concern for claims for damages arising out of or related to such services to the Companyand/or one or more subsidiaries of the Company.     J. The Indemnitee is willing to serve, or to continue to serve, the Company and/or one or moresubsidiaries of the Company, provided that he is furnished the indemnity provided for herein.
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Agreement     NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows:     1. Definitions.          (a) Agent. For the purposes of this Agreement, “agent” of the Company means any personwho is or was a director, officer, employee or other agent of the Company or a subsidiary of theCompany; or is or was serving at the request of, for the convenience of, or to represent theinterests of the Company or a subsidiary of the Company as a director, officer, employee or agentof another foreign or domestic corporation, partnership, joint venture, trust or other domesticcorporation which was a predecessor corporation of the Company or a subsidiary of the Company, orwas a director, officer, employee or agent of another enterprise at the request of, for theconvenience of, or to represent the interests of such predecessor corporation.          (b) Expenses. For purposes of this Agreement, “expenses” includes all direct andindirect costs of any type or nature whatsoever (including, without limitation, all attorneys’ feesand related disbursements, other out-of-pocket costs and reasonable compensation for time spent bythe Indemnitee for which he is not otherwise compensated by the Company or any third party)actually and reasonably incurred by the Indemnitee in connection with either the investigation,defense or appeal of a proceeding or establishing or enforcing a right to indemnification underthis Agreement or Section 317 of the Code, or settling or otherwise disposing of a pending actionprovided court approval is obtained.          (c) Liabilities. For purposes of this Agreement, “liabilities” include all judgments,fines, ERISA excise taxes and penalties and amounts paid in settlement.          (d) Proceeding. For purposes of this Agreement, “proceeding” means any threatened,pending, or completed action, suit or other proceeding, whether civil, criminal, administrative, orinvestigative.          (e) Subsidiary. For purposes of this Agreement, “subsidiary” means any corporation ofwhich more than 50% of the outstanding voting securities is owned directly or indirectly by theCompany, by the Company and one or more other subsidiaries, or by one or more other subsidiaries.     2. Agreement to Serve. The Indemnitee agrees to serve and/or continue to serve as anagent of the Company, at its will (or under separate agreement, if such agreement exists), in thecapacity Indemnitee currently serves as an agent of the Company, so long as he is duly appointed orelected and qualified in accordance with the applicable provisions of the Bylaws of the Company orany subsidiary of the Company or until such time as he tenders his resignation in writing;provided, however, that nothing contained in this Agreement is intended to create any right tocontinued employment by Indemnitee.
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     3. Liability Insurance.          (a) Maintenance of D&O Insurance. The Company hereby covenants and agrees that, solong as the Indemnitee shall continue to serve as an agent of the Company and thereafter so long asthe Indemnitee shall be subject to any possible proceeding by reason of the fact that theIndemnitee was an agent of the Company, the Company, subject to Section 3(c), shall promptly obtainand maintain in full force and effect directors’ and officers’ liability insurance (“D&OInsurance”) in reasonable amounts from established and reputable insurers.          (b) Rights and Benefits. In all policies of D&O Insurance, the Indemnitee shall benamed as an insured in such a manner as to provide the Indemnitee the same rights and benefits asare accorded to the most favorably insured of the Company’s directors, if the Indemnitee is adirector; or of the Company’s officers, if the Indemnitee is not a director of the Company but isan officer; or of the Company’s key employees, if the Indemnitee is not a director or officer butis a key employee.          (c) Limitation on Required Maintenance of D&O Insurance. Notwithstanding theforegoing, the Company shall have no obligation to obtain or maintain D&O Insurance if the Companydetermines in good faith that such insurance is not reasonably available, the premium costs forsuch insurance are disproportionate to the amount of coverage provided, the coverage provided bysuch insurance is limited by exclusions so as to provide an insufficient benefit, or the Indemniteeis covered by similar insurance maintained by a subsidiary of the Company.     4. Mandatory Indemnification. Subject to Sections 4(d) and 9 below, the Company shallindemnify the Indemnitee as follows:          (a) Third Party Actions. If the Indemnitee is a person who was or is a party or isthreatened to be made a party to any proceeding (other than an action by or in the right of theCompany) by reason of the fact that he is or was an agent of the Company, or by reason of anythingdone or not done by him in such capacity, the Company shall indemnify the Indemnitee against anyand all expenses and liabilities of any type whatsoever actually and reasonably incurred by him inconnection with the investigation, defense, settlement or appeal of such proceeding, provided theIndemnitor acted in good faith and in a manner he reasonably believed to be in or not opposed tothe best interests of the Company, and, with respect to any criminal action or proceeding, had noreasonable cause to believe his conduct was unlawful.          (b) Derivative Actions. If the Indemnitee is a person who was or is a party or isthreatened to be made a party to any proceeding by or in the right of the Company to procure ajudgment in its favor by reason of the fact that he is or was an agent of the Company, or by reasonof anything done or not done by him in such capacity, the Company shall indemnify the Indemniteeagainst any and all expenses actually and reasonably incurred by him in connection with theinvestigation, defense, settlement, or appeal of such proceeding, provided the Indemnitor acted ingood faith and in a manner he reasonably believed to be in or not opposed to the best interests ofthe Company and its shareholders. Notwithstanding the foregoing, no indemnification under thissubsection 4(b) shall be made (i) in respect to any claim, issue or matter as to which such personshall have been finally adjudged to be liable to the Company in the performance of such person’sduty to the Company and its shareholders, unless, and only to
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the extent that the court in which such proceeding was brought shall determine uponapplication that, in view of all the circumstances of the case, such person is fairly andreasonably entitled to indemnity for such amounts and then only to the extent that the court shalldetermine, (ii) of amounts paid in settling or otherwise disposing of a pending action withoutcourt approval, or (iii) of expenses incurred in defending a pending action that is settled orotherwise disposed of without court approval.          (c) Actions where Indemnitee is Deceased. If the Indemnitee is a person who was or isa party or is threatened to be made a party to any proceeding by reason of the fact that he is orwas an agent of the Company, or by reason of anything done or not done by him in such capacity, andif prior to, during the pendency or after completion of such proceeding Indemnitee becomesdeceased, the Company shall indemnify the Indemnitee’s heirs, executors and administrators againstany and all expenses and liabilities of any type whatsoever actually and reasonably incurred to theextent Indemnitee would have been entitled to indemnification pursuant to Sections 4(a) or 4(b)above were Indemnitee still alive.          (d) Limitations on Indemnitee. Notwithstanding the foregoing, the Company shall not beobligated to indemnify the Indemnitee pursuant to this Agreement:               (i) on account of any claim against Indemnitee for an accounting of profits made from thepurchase or sale by Indemnitee of securities of the Company pursuant to the provisions of Section16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of anyfederal, state or local statutory law;               (ii) for any amount for which payment is actually made to Indemnitee under a valid andcollectible insurance policy of D&O Insurance, 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;               (iii) if indemnification is not lawful (and, in this respect, both the Company and Indemniteehave been advised that the Securities and Exchange Commission believes that indemnification forliabilities 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 foradjudication);               (iv) on account of any acts or omissions from which a director may not be relieved ofliability as set forth in Section 204 of the Code (whether or not Indemnitee is a director of theCompany) or as to circumstances in which indemnification is prohibited by Section 317 of the Code.     5. Partial Indemnification. If the Indemnitee is entitled under any provision of thisAgreement to indemnification by the Company for some or a portion of any expenses or liabilities ofany type whatsoever incurred by him in the investigation, defense, settlement or appeal of aproceeding, but not entitled, however, to indemnification for all of the total amount thereof, theCompany shall nevertheless indemnify the Indemnitee for such total amount except as to the portionthereof to which the Indemnitee is not entitled.
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     6. Mandatory Advancement of Expenses. Subject to Section 9(a) below, the Company shalladvance all expenses incurred by the Indemnitee in connection with the investigation, defense,settlement or appeal of any proceeding to which the Indemnitee is a party or is threatened to bemade a party by reason of the fact that the Indemnitee is or was an agent of the Company.Indemnitee hereby undertakes to repay such amounts advanced if, and to the extent that, it shallultimately be determined that the Indemnitee is not entitled to such amounts. The advance to bemade hereunder shall be paid by the Company to the Indemnitee within twenty (20) days followingdelivery of a written request therefor by the Indemnitee to the Company.     7. Notice and Other Indemnification Procedures.          (a) Promptly after receipt by the Indemnitee of notice of the commencement of or the threat ofcommencement of any proceeding, the Indemnitee shall, if the Indemnitee believes thatindemnification with respect thereto may be sought from the Company under this Agreement, notifythe Company of the commencement or threat of commencement thereof.          (b) If at the time of the receipt of a notice pursuant to Section 7(a) hereof of thecommencement of a proceeding the Company has D&O Insurance in effect, the Company shall give promptnotice of the commencement of such proceeding to the 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.          (c) In the event the Company shall be obligated to pay the expenses of any proceeding againstthe Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of suchproceeding, with counsel approved by the Indemnitee, upon the delivery to the Indemnitee of writtennotice of its election so to do. After delivery of such notice, approval of such counsel by theIndemnitee and the retention of such counsel by the Company, the Company will not be liable to theIndemnitee under this Agreement for any fees of counsel subsequently incurred by the Indemniteewith respect to the same proceeding, provided that (i) the Indemnitee shall have the right toemploy his counsel in any such proceeding at the Indemnitee’s expense; and (ii) if (A) theemployment of counsel by the Indemnitee has been previously authorized by the Company, (B) theIndemnitee shall have reasonably concluded that there may be a conflict of interest between theCompany and the Indemnitee in the conduct of any such defense or (C) the Company shall not, infact, have employed counsel to assume the defense of such proceeding, the fees and expenses ofIndemnitee’s counsel shall be at the expense of the Company.     8. Shareholder Ratification. Unless the form of this Agreement has been approved bythe shareholders of the Company, this Agreement shall be expressly subject to ratification by suchshareholders. If the form of this Agreement is not so ratified and/or approved by such shareholdersbefore the effective date of this Agreement, or within two (2) years after the effective datehereof, this Agreement shall be void.     9. Exceptions. Any other provision herein to the contrary notwithstanding, the Companyshall not be obligated pursuant to the terms of this Agreement:
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          (a) Claims Initiated by Indemnities. To indemnify or advance expenses to theIndemnitee with respect to proceedings or claims initiated or brought voluntarily by the Indemniteeand not by way of defense, unless (i) such indemnification is expressly required to be made by law,(ii) the proceeding was authorized by the Board, (iii) such indemnification is provided by theCompany, in its sole discretion, pursuant to the powers vested in the Company under the Code or(iv) the proceeding is brought to establish or enforce a right to indemnification under thisAgreement or any other statute or law.          (b) Lack of Good Faith. To indemnify the Indemnitee for any expenses incurred by theIndemnitee with respect to any proceeding instituted by the Indemnitee to enforce or interpret thisAgreement, if a court of competent jurisdiction determines that each of the material assertionsmade by the Indemnitee in such proceeding was not made in good faith or was frivolous; or          (c) Unauthorized Settlements. To indemnify the Indemnitee under this Agreement for anyamounts paid in settlement of a proceeding unless the Company consents to such settlement, whichconsent shall not be unreasonably withheld.     10. Non-exclusivity. The provisions for indemnification and advancement of expensesset forth in this Agreement shall not be deemed exclusive of any other rights which the Indemniteemay have under any provision of law, the Company’s Articles of Incorporation or Bylaws, the vote ofthe Company’s shareholders or disinterested directors, other agreements, or otherwise, both as toaction in his official capacity and to action in another capacity while occupying his position asan agent of the Company, and the Indemnitee’s rights hereunder shall continue after the Indemniteehas ceased acting as an agent of the Company and shall inure to the benefit of the heirs, executorsand administrators of the Indemnitee.     11. Enforcement. Any right to indemnification or advances granted by this Agreement toIndemnitee shall be enforceable by or on behalf of Indemnitee in any court of competentjurisdiction 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. Indemnitee,in such enforcement action, if successful in whole or in part, shall be entitled to be paid alsothe expense of prosecuting his claim. It shall be a defense for any action for which a claim forindemnification is made under this Agreement (other than an action brought to enforce a claim forexpenses pursuant to Section 6 hereof, provided that the required undertaking has been tendered tothe Company) that Indemnitee is not entitled to indemnification because of the limitations setforth in Sections 4 and 9 hereof. Neither the failure of the Company (including its Board ofDirectors or its shareholders) to have made a determination prior to the commencement of suchenforcement action that indemnification of Indemnitee is proper in the circumstances, nor an actualdetermination by the Company (including its Board of Directors or its shareholders) that suchindemnification is improper, shall be a defense to the action or create a presumption thatIndemnitee is not entitled to indemnification under this Agreement or otherwise.     12. Subrogation. In the event of payment under this Agreement, the Company shall besubrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall
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execute all documents required and shall do all acts that may be necessary to secure suchrights and to enable the Company effectively to bring suit to enforce such rights.     13. Survival of Rights.          (a) All agreements and obligations of the Company contained herein shall continue during theperiod Indemnitee is an agent of the Company and shall continue thereafter so long as Indemniteeshall be subject to any possible claim or threatened, pending or completed action, suit orproceeding, whether civil, criminal, arbitrational, administrative or investigative, by reason ofthe fact that Indemnitee was serving in the capacity referred to herein.          (b) The Company shall require any successor to the Company (whether direct or indirect, bypurchase, merger, consolidation or otherwise) to all or substantially all of the business or assetsof the Company, expressly to assume and agree to perform this Agreement in the same manner and tothe same extent take the Company would be required to perform if no such succession had takenplace.     14. Interpretation of Agreement. It is understood that the parties hereto intend thisAgreement to be interpreted and enforced so as to provide indemnification to the Indemnitee to thefullest extent permitted by law including those circumstances in which indemnification wouldotherwise be discretionary.     15. Severability. If any provision or provisions of this Agreement shall be held to beinvalid, illegal or unenforceable for any reason whatsoever, (i) the validity, legality andenforceability of the remaining provisions of the Agreement (including without limitation, allportions of any paragraphs of this Agreement containing any such provision held to be invalid,illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall not inany way be affected or impaired thereby, and (ii) to the fullest extent possible, the provisions ofthis Agreement (including, without limitation, all portions of any paragraphs of this Agreementcontaining any such provision held to be invalid, illegal or unenforceable, that are not themselvesinvalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifestedby the provisions held invalid, illegal or unenforceable and to give effect to Section 11 hereof.     16. Modification and Waiver. No supplemental, modification or amendment of thisAgreement shall be binding unless executed in writing by both of the parties hereto. No waiver ofany of the provisions of this Agreement shall be deemed or shall constitute a waiver of any otherprovisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.     17. Notice. All notices, requests, demands and other communications under thisAgreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receiptedfor by the party addressee or (ii) if mailed by certified or registered mail with postage prepaid,on the third business day after the mailing date. Address for notice to either party are as shownon the signature page of this Agreement, or as subsequently modified by written notice.     18. Governing Law. This Agreement shall be governed exclusively by and construedaccording to the laws of the State of California as applied to contracts between Californiaresidents entered into and to be performed entirely within California.
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     19. Consent to Jurisdiction. The Company and the Indemnitee each hereby irrevocablyconsent to the jurisdiction of the courts of the State of California for all purposes in connectionwith any action or proceeding which arises out of or relates to this Agreement and agree that anyaction instituted under this Agreement shall be brought only in the state court of the State ofCalifornia.
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     The parties hereto have entered into this Indemnity Agreement effective as of the date firstabove written.           COMPANY:   INDEMNITEE:             Abaxis, Inc.                   By                   Name:   Name:                   Address:                                                           
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