Document:

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                                                                    EXHIBIT 10.4

         Each of the following executive officers of Chaparral Network Storage,
Inc. (the "Corporation") has executed an Executive Employment and Non-Compete
Agreement with the Corporation in a form substantially identical to the form of
agreement between the Corporation and Executive attached hereto: Gary L.
Allison, Michael J. Gluck and Jerry L. Walker. The material details in which
their agreements differ from the form agreement are set forth below.

         1. Gary Allison, Chief Executive Officer. Allison's
agreement differs from the form agreement attached hereto only as follows:

            Recitals
            --------
               Position -- Chief Executive Officer
               Reports to -- Board of Directors

            Section 1
            ---------
               Position -- Chief Executive Officer

            Section 3
            ---------
               Reports to -- Board of Directors

            Section 4
            ---------
               Options -- 200,000

            Section 7
            ---------
               Vacation -- Six (6) work weeks of paid vacation
                        -- may accrue up to fifteen (15) work weeks of paid
                           vacation

         2. Michael J. Gluck, President and Chief Operating Officer. Gluck's
agreement differs from the form agreement attached hereto only as follows:

            Recitals
            --------
               Position -- President and Chief Operating Officer
               Reports to -- Chief Executive Officer and Chairman of the Board
                             of Directors

            Section 1
            ---------
               Position -- President and Chief Operating Officer

            Section 3
            ---------
               Reports to -- Chief Executive Officer and Chairman of the Board
                             of Directors

            Section 4
            ---------
               Options -- 150,000

            Section 7
            ---------
               Vacation -- Four (4) work weeks of paid vacation
                        -- may accrue up to ten (10) work weeks of paid vacation

         3. Jerry L. Walker, Executive Vice President. Walker's agreement
differs from the form agreement attached hereto only as follows:

            Recitals
            --------
               Position -- Executive Vice President for Engineering and
                           Operations
               Reports to -- President

            Section 1
            ---------
               Position -- Executive Vice President for Engineering and
                           Operations

            Section 3
            ---------
               Reports to -- President

            Section 4
            ---------
               Options -- 150,000

            Section 7
            ---------
               Vacation -- Four (4) work weeks of paid vacation
                        -- may accrue up to ten (10) work weeks of paid vacation

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                                    FORM OF
                 EXECUTIVE EMPLOYMENT AND NON-COMPETE AGREEMENT

         THIS EXECUTIVE EMPLOYMENT AND NON-COMPETE AGREEMENT (the "Agreement"),
effective April 1, 2000, is by and between CHAPARRAL NETWORK STORAGE, INC.
("Chaparral"), a Delaware corporation, and Executive.

         WHEREAS, Executive holds the position of President and Chief Operating
Officer with Chaparral, reports to the _______________________________________
______________________, and is an integral part of Chaparral's executive and
management operations;

         WHEREAS, it is the desire of the Board of Directors of Chaparral to
assure itself of the executive and management services of Executive by employing
Executive in the position of ______________________________________; and

         WHEREAS, Executive is desirous of committing himself to serve Chaparral
pursuant to the terms provided herein; and

         WHEREAS, Chaparral is desirous of entering into a non-compete agreement
with Executive.

         NOW THEREFORE, in consideration of the foregoing and of the respective
covenants and agreements set forth below, the parties agree as follows:

         1. Employment. Chaparral agrees to employ Executive and Executive
hereby agrees to be employed as Chaparral's _______________________________
__________, or in another position by mutual agreement of the parties and
consistent with Executive's responsibilities in those positions, to which he may
hereafter be elected or appointed during the Employment Term, as hereinafter
defined.

         2. Employment Term. Executive's employment pursuant to this Agreement
shall be for a term of two (2) years commencing upon the execution of this
Agreement, unless terminated earlier pursuant to Sections 9, 10, 11, 12 or 13 of
this Agreement (the "Employment Term"). This Agreement is automatically renewed
for successive one (1) year periods, unless either party provides written notice
to the other party of an intent not to renew the Agreement, at least ninety (90)
days prior to the expiration of the Agreement.

         3. Responsibilities. During the Employment Term, Executive shall render
such services to Chaparral as are reasonably required by the Board of Directors
and as may be required by virtue of the office(s) and positions held by
Executive. Executive shall report to the ______________________.

         4. Compensation. As full compensation for all services rendered
pursuant to this Agreement, Chaparral agrees to pay Executive a base salary, as
the Board of Directors may designate from time to time, at a rate of not less
than one hundred and eighty thousand dollars ($180,000) per year ("Base
Salary"), less applicable taxes and withholdings. The Base Salary shall be
subject to review by the Board of Directors annually. In addition to his Base
Salary, Executive may receive a quarterly cash bonus of up to twenty-five
percent (25%) of his Base Salary ("Quarterly Bonus") and/or additional stock
options, as determined by the Board of Directors. In addition to his Base Salary
and Quarterly Bonus, Executive may receive an annual bonus of up to

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100% of his Base Salary ("Annual Bonus"), as determined by the Board of
Directors, which Annual Bonus will be payable in the form of cash or shares of
Common Stock, at the election of Executive. The Quarterly Bonus and the Annual
Bonus are together referred to as "Bonus." Executive shall also receive a car
allowance of $500 per month ($6,000 per year). Upon the effective date of a
registration statement on Form S-1 for an initial public offering of Chaparral,
Mr. Executive will be granted an option to purchase _______ shares of Common
Stock, which option will (i) be an incentive stock option to extent allowed
under the Internal Revenue Code of 1986, as amended, (ii) have an exercise price
equal to the offering price per share in the initial public offering and (iii)
vest in three equal annual installments on the first, second and third
anniversary date of the date of grant.

         5. Expenses. During the Employment Term, Chaparral shall reimburse
Executive for his reasonable travel, business entertainment, and other business
expenses incurred in the performance of his duties, subject to the rules and
regulations adopted by Chaparral for the handling of such business expenses.

         6. Other Benefits. During the Employment Term, Chaparral shall pay for
Executive to have the same insurance and other benefits that Chaparral makes
available to other similarly situated employees and/or executives, such benefits
shall include, but not be limited to, a stock option plan. Chaparral shall
provide such benefits pursuant to the provisions of the agreements, policies,
etc. maintained by Chaparral regarding those individual benefits.

         7. Vacations. Executive shall be entitled to four (4) workweeks of paid
vacation each year, or such additional number of days or weeks as may be
determined by the Board of Directors. Executive shall accrue such vacation days
on the first day of the calendar year. Executive shall be permitted to accrue up
to __________________ of paid vacation. Upon reaching this maximum accrual,
Executive will receive compensation for any accrued, but unused vacation days so
that his accrued vacation days will not exceed _________________. Upon his
termination of employment from Chaparral, Executive will receive compensation at
his then regular rate of pay for his accrued, but unused paid vacation days.

         8. Confidentiality Covenant. In addition to the provisions set forth in
Sections 14 and 15, Executive agrees while employed by Chaparral and thereafter
for a period of two (2) years not to, directly or indirectly, disclose or use to
the detriment of Chaparral, or for the benefit of any other person or firm, any
Confidential Information and Materials (defined below). Furthermore, Executive
shall deliver promptly to Chaparral upon termination of employment, or at any
time Chaparral may so request, all Confidential Information and Materials
relating to the business of Chaparral then possessed or under the control of
Executive.

         Executive acknowledges and agrees that all Confidential Information and
Materials shall, to the extent possible, be considered works made for hire for
Chaparral under applicable copyright law. To the extent any Confidential
Information and Materials are not deemed to be a work made for hire, Executive
hereby assigns to Chaparral any rights he may have or may acquire in such
Confidential Information and Materials as they are created, throughout the
world, in perpetuity. Further, Executive hereby waives any and all moral rights
he may have in such Confidential Information and Materials. Notwithstanding the
foregoing, Chaparral acknowledges that it shall have no right to inventions or
other material for which no equipment, supplies, facilities or

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Confidential Information and Material of Chaparral are used and which are
developed entirely on Executive's own time and (a) do not relate directly to the
business of Chaparral or (b) do not result from any work performed by Executive
under this Agreement.

         For purposes of this Agreement, "Confidential Information and
Materials" refers to all information belonging to or used by Chaparral or
Chaparral's clients relating to internal operations, procedures and policies,
finances, income, profits, business strategies, pricing, billing information,
compensation and other personnel information, client contacts, sales lists,
employee lists, technology, software source codes, programs, costs, marketing
plans, developmental plans, computer programs, computer systems, inventions,
developments, personnel manuals, computer program manuals, programs and system
designs, and trade secrets of every kind and character, whether or not they
constitute a trade secret under applicable law and whether developed by
Executive during or after business hours.

         9. Termination by Reason of Incapacity. If during the Employment Term,
Executive is unable to perform the essential duties of his positions with
Chaparral by reason of any physical or mental condition for a continuous period
of six (6) months, then Chaparral, in its sole and absolute discretion, may
consider such condition to be permanent and may, upon thirty (30) days written
notice to Executive, terminate Executive's employment hereunder, but Executive
shall continue to be eligible to receive any benefits to which he may be
entitled under the terms of any long-term disability plan for Chaparral
employees and/or executives. In the event of such incapacity, Chaparral's
termination of Executive will be considered a "Termination by Reason of
Incapacity," and Executive shall immediately be paid all accrued Base Salary,
all accrued vacation time, any unpaid Bonus and any reasonable and necessary
business expenses incurred by Executive in connection with his duties hereunder,
all to the date of termination. In addition, Chaparral shall pay Executive the
difference between his Base Salary and Bonus, at the rate existing at the time
of such termination, and the amount he receives from any long term disability
insurance plan, for a period of one (1) year following such termination.
Executive shall receive such payments on Chaparral's designated payday
(currently on the 1st and 15th of each calendar month). Notwithstanding the
foregoing, Chaparral's obligation to Executive for severance compensation under
this section shall immediately cease if Executive is in violation of the
provisions of Sections 8, 14 and/or 15 hereof.

         10. Termination by Reason of Death. The Employment Term, unless
terminated earlier pursuant to this Agreement, shall automatically terminate on
the last day of the month in which Executive's death occurs. If Executive's
employment with Chaparral terminates pursuant to this subsection, the
termination shall be considered a "Termination by Reason of Death," and
Executive's heirs shall immediately be paid all accrued Base Salary, all accrued
vacation time, any unpaid Bonus and any reasonable and necessary business
expenses incurred by Executive in connection with his duties hereunder, all to
the date of termination. In addition, Chaparral shall pay Executive's heirs
Executive's Base Salary and Bonus, at the rate existing at the time of such
termination, for a period of one (1) year following such termination.
Executive's heirs shall receive such payments on Chaparral's designated payday
(currently on the 1st and 15th of each calendar month)

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         11. Termination for Cause. Termination for Cause shall occur in the
event that Executive:

             a. commits any fraudulent or felonious act in respect to duties to
Chaparral or shall, with respect to his employment, commit an act of moral
turpitude of such degree that it bears upon his ability to carry out his
functions under this Agreement; or

             b. commits any willful malfeasance or gross negligence (in the
discharge of duties to Chaparral) having a material adverse effect on Chaparral.

         Upon the Termination for Cause of Executive's employment, Executive
shall immediately be paid all accrued Base Salary, all accrued vacation time,
any unpaid Bonus and any reasonable and necessary business expenses incurred by
Executive in connection with his duties hereunder, all to the date of
termination. In addition, the parties' obligations hereunder, except as set
forth in Sections 8, 14, 15 and 17, hereof, shall terminate; provided, however,
that rights and remedies accruing prior to such termination or arising out of
the breach of this Agreement shall survive.

         12. Termination Other Than for Cause. A "Termination Other Than for
Cause" shall include Chaparral's termination of Executive's employment with
Chaparral for any reason or for no reason, excluding a Termination for Cause, a
Termination Upon a Change in Control, a Termination by Reason of Incapacity and
a Termination by Reason of Death. Chaparral is required to give Executive ninety
(90) days notice of its termination of his employment under this section. A
"Termination Other Than for Cause" shall also include termination by Executive
within thirty (30) days following the occurrence of any of the following
(without Executive's express written consent):

             a. the assignment to Executive by Chaparral of duties inconsistent
with, or a substantial diminution in the nature or status of, Executive's
responsibilities;

             b. material reduction by Chaparral in Executive's compensation and
benefits or perquisites (unless all Chaparral employees are subject to an across
the board reduction in compensation and/or benefits);

             c. a relocation of Chaparral's principal offices to a location
outside a 50 mile radius of Longmont, Colorado, or Executive's relocation to any
place other than the principal office of Chaparral, except for reasonably
required travel by Executive on Chaparral's business; or

             d. any material breach by Chaparral of any provision of this
Agreement, if such material breach has not been cured within thirty (30) days
following written notice by Executive to Chaparral of such breach setting forth
with specificity the nature of the breach.

         Upon a Termination Other Than for Cause, Executive shall immediately be
paid all accrued Base Salary, all accrued vacation time, any unpaid Bonus and
any reasonable and necessary business expenses incurred by Executive in
connection with his duties hereunder, all to the date of termination. In
addition, Executive will receive his Base Salary and Bonus, at the rate existing
at the time of such termination, and Executive shall be entitled to receive
benefits, for a period of one (1) year following termination. Executive shall
receive such payments on Chaparral's designated payday (currently on the 1st and
15th of each calendar month). Upon termination pursuant to this

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Section 12, any options to purchase common stock of the Company held by
Executive will automatically be vested and exercisable for a period of one (1)
year following termination and restrictions on any shares of restricted stock
held by Executive shall immediately lapse. Notwithstanding the foregoing,
Chaparral's obligation to Executive for severance compensation under this
section shall cease immediately if Executive is in violation of the provisions
of Sections 8, 14 and/or 15 hereof.

         13. Termination upon a Change in Control. In the event of a Termination
Upon a Change in Control (as defined below), Executive shall immediately be paid
all accrued Base Salary, all accrued vacation time, any unpaid Bonus and any
reasonable and necessary business expenses incurred by Executive in connection
with his duties hereunder, all to the date of termination. In addition,
Executive shall immediately be paid a lump sum payment of an amount equal to two
(2) years Base Salary and Bonus, at the rate existing at the time of such
termination, and Executive shall be entitled to receive fully paid benefits for
a period of two (2) years following termination. Executive shall receive such
payments on Chaparral's designated payday (currently on the 1st and 15th of each
calendar month). Each option outstanding at the time of a Change in Control, but
not otherwise fully-vested, shall be accelerated for twelve (12) months.
However, if the successor company terminates Executive for any reason within
twelve (12) months from the date of the Change of Control or the successor
company does not adopt the plan in its entirety or convert to a plan of
equivalent value, then all options will automatically be 100% vested, as of the
date of the Change of Control.

         Notwithstanding the foregoing, (a) solely in the event of a Termination
Upon Change in Control, the aggregate amount of severance compensation paid to
Executive under this Agreement or otherwise shall not include any amount that
Chaparral is prohibited from deducting for federal income tax purposes by virtue
of Section 280G of the Internal Revenue Code or any successor provision; and (b)
Chaparral's obligation to Executive for severance compensation under this
section shall cease immediately if Executive is in violation of the provisions
of Sections 8, 14 and/or 15 hereof.

         "Termination Upon a Change in Control" shall mean a termination by
Chaparral or any successor thereto of Executive's employment with Chaparral or
such successor for any reason or a termination by Executive for Good Reason (as
defined below) of Executive's employment with Chaparral or any successor thereto
within twelve (12) months from the date on which any of the following occurs:

             a. any "person" or "group" (within the meaning of Sections 13(d)
and 14(d)(2) of the Securities Exchange Act of 1934 (the "1934 Act")), other
than a trustee or other fiduciary holding securities under an employee benefit
plan of Chaparral, is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the 1934 Act), directly or indirectly, of greater than fifty percent
(50%) of the then outstanding voting stock of Chaparral; or

             b. at any time during any period of three consecutive years (not
including any period prior to the effective date of this Agreement), individuals
who at the beginning of such period constitute the Board (and any new director
whose election by the Board or whose nomination for election by Chaparral's
stockholders was approved by a vote of at least two-thirds of the directors then
still in office who either were directors at the beginning of such

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period or whose election or nomination for election was previously so approved)
cease for any reason to constitute a majority thereof; or

             c. the stockholders of Chaparral approve a merger or consolidation
of Chaparral with any other corporation, other than a merger or consolidation
which would result in the voting securities of Chaparral outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at least 80% of
the combined voting power of the voting securities of Chaparral or such
surviving entity outstanding immediately after such merger or consolidation or
an agreement for the sale or disposition by Chaparral of all or substantially
all of Chaparral's assets.

         "Good Reason" shall include, but not be limited to, any of the
following (without Executive's express written consent):

             a. the assignment to Executive by Chaparral of duties inconsistent
with, or a substantial diminution in the nature or status of, Executive's
responsibilities immediately prior to a Change in Control other than any changes
primarily attributable to the fact that Chaparral's securities are no longer
publicly traded;

             b. a material reduction by Chaparral in Executive's compensation
and benefits or perquisites (unless all Chaparral employees are subject to an
across the board reduction in compensation and/or benefits), as in effect on the
date of a Change in Control;

             c. a relocation of Chaparral's principal offices to a location
outside a 50 mile radius outside of Longmont, Colorado, or Executive's
relocation to any place other than the principal offices of Chaparral offices of
Chaparral, except for reasonably required travel by Executive on Chaparral's
business;

             d. any material breach by Chaparral of any provision of this
Agreement, if such material breach has not been cured within thirty (30) days
following written notice by Executive to Chaparral of such breach setting forth
with specificity the nature of the breach; or

             e. any failure by Chaparral to obtain the assumption and
performance of this Agreement by any successor (by merger, consolidation or
otherwise) or assign of Chaparral.

         14. Covenant Not to Compete. In consideration of this Agreement,
Executive agrees that he will not, during the term of his employment and for one
(1) year after his date of termination, directly or indirectly, either as an
employee, employer, consultant, agent, principal, partner, corporate officer,
director, investor, or financier, or in any other individual or representative
capacity:

             a. participate in or consult with any business in the world, that
(i) is in competition with Chaparral's business as it exists at the date of his
termination, or of the products or services offered by Chaparral in the world,
or (ii) Chaparral has requested and received confidential information relating
to the acquisition of such business by Chaparral within the four (4) month
period prior to the termination of Executive's employment with the Company; or

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             b. engage in any acts or activities, which would interfere with or
harm any business relationship Chaparral may have with any then current
customer, supplier, employee, or investor.

         An investment by Executive of up to 2% of the outstanding equity in a
publicly traded corporation shall not constitute a violation of this Section 14.
Executive agrees that this covenant not to compete is reasonable as to
geographic scope and duration. Executive agrees that this non-competition
agreement supersedes any non-competition agreement Executive may have executed
before this date. Notwithstanding the foregoing, Executive shall not be
prohibited, during the one-year period following termination of his employment
agreement and while this non-compete restriction is in effect, from working in
any capacity in a company which is not a competitor of Chaparral.

         15. Further Restrictions. Executive covenants that during his
employment and for one (1) year after his date of termination, he will not
directly or indirectly:

             a. call on or solicit, or attempt to call on or solicit, or assist
in the solicitation of, any of the past, present or prospective customers or
suppliers of Chaparral in any manner which is competitive with the business of
Chaparral as it is operated as of the termination of this Agreement;

             b. induce, or attempt to induce, any employee of Chaparral to
terminate his or her employment, or hire away, or attempt to hire away, any
employee of Chaparral;

             c. induce, or attempt to induce, any present or future supply or
service resource from Chaparral; or

             d. knowingly engage in any act or activity, which would interfere
with or harm any business relationship Chaparral may have with any customer,
employee, principle, or supplier. The mere act of termination of his employment
status shall not in and of itself constitute harm to Chaparral.

         16. Remedies for Breach. Executive acknowledges that the legal remedies
for breach of the covenants contained in Sections 8, 14 and 15 may be
inadequate, and therefor agrees that, in addition to any or all other remedies
available to Chaparral in the event of a proven breach of any covenant contained
in Sections 8, 14 and 15, Chaparral may seek to:

             a. obtain preliminary and permanent injunctions against any and all
such actions; and

             b. recover from Executive monetary damages to Chaparral arising
from such breach.

         If Chaparral brings such an action and does not prevail, Executive
shall recover any monetary damages, his attorneys' fees and costs associated
with defending against the action. THE PARTIES HAVE CAREFULLY CONSIDERED ALL OF
SECTIONS 8, 14, 15 AND 16 AND AGREE THAT THEY REPRESENT A PROPER BALANCING OF
THEIR INTERESTS AND

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WILL NOT PREVENT Executive FROM EARNING A LIVING AFTER TERMINATION OF HIS
EMPLOYMENT.

         Additionally, if Executive violates Section 8, 14, or 15 of this
Agreement during any time that he is receiving severance payments from Chaparral
under Section 9, 11, 12 or 13, Chaparral shall be entitled to discontinue paying
Executive any additional severance pay or benefits, and Executive shall be
required to pay back to Chaparral the lesser of (i) two months of severance
payments or (ii) severance payments received to date.

         17. Indemnification. Chaparral agrees to defend, indemnify and save
Executive harmless from any claims, proceedings, actions, or causes of actions
brought against him in his capacity as an employee of Chaparral. This
indemnification provision does not apply where the proceeding, claim, action, or
cause of action brought against Executive is as a result of an event for which
Executive is terminated for cause, pursuant to Section 11 of this Agreement.
Chaparral agrees to indemnify Executive for the above claims no matter when such
claims are filed or alleged.

         18. Release of Claims. Prior to Executive's receipt of any severance
payment referenced in Section 9, 11, 12, or 13, of this Agreement, Executive
shall be required to sign an agreement releasing Chaparral from any and all
claims related to his employment or his termination of employment from
Chaparral. Such release shall include, but not be limited to, claims for
wrongful discharge; claims for discrimination in employment, including claims
under federal or state statute, rule or regulation; claims under the Americans
with Disabilities Act; claims under the Age Discrimination in Employment Act;
claims under the Older Workers Benefit Protection Act; claims under Title VII of
the 1964 Civil Rights Act; claims for violation of any fair or unfair employment
practices act or law; claims for unpaid wages, either regular or overtime,
compensation, benefits or remuneration; claims for defamation, libel, slander,
and other negligent or intentional torts; claims for invasion of privacy; claims
for outrageous conduct; claims for intentional interference with express or
implied contract concerning employment; claims for breach of express or implied
employment contract; claims for breach of express or implied covenant of good
faith and fair dealing; claims for violation of Colorado Revised Statute Section
8-2-101, et seq.; and claims for discrimination on the basis of a prohibited
basis under Title VII of the Civil Rights Act of 1964 and Colorado's
Anti-Discrimination and Unfair Employment Practices Act. If Executive does not
sign and execute the release prepared by Chaparral, Executive shall not be
entitled to any severance pay or benefits as set forth in Section 9, 11, 12, and
13 of this Agreement. After Chaparral presents Executive with the release
agreement, Executive shall have twenty-one (21) days within which to consider
whether to sign the release agreement. During this time period, Chaparral
advises Executive to consult with an attorney regarding the release agreement.
After signing the release agreement, Executive shall have seven (7) days within
which to notify Chaparral that he wants to void the release agreement. Chaparral
is not required to make any severance payments, pursuant to Section 9, 11, 12 or
13, until the expiration of this seven (7) day period.

         19. Amendments. This Agreement may be amended or modified from time to
time, but only by written instrument executed by all parties hereto. No
variations, modifications, or changes herein or hereof shall be binding upon any
party hereto except as set forth in such a written instrument.

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         20. Notices. All notices, demands, or requests provided for or
permitted to be given pursuant to this Agreement must be given in writing,
unless otherwise specified, and shall be deemed to have been properly given,
delivered, or served by depositing the same in the United States mail, postage
prepaid, certified or registered mail, with deliveries to be made to the
following addresses:

                 If to Executive:

                 If to Chaparral:         Chaparral Network Storage, Inc.
                                          1951 S. Fordham St.
                                          Longmont, Colorado 80503.

         Either party may change such party's address for notices by notice
given pursuant to this Section 20.

         21. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Colorado.

         22. Severability. If an arbitrator, or Court, determines that one or
more provisions of this Agreement is/are invalid, the invalidity of any one or
more of such provisions does not affect or limit the enforceability of the
remaining provisions or Sections of this Agreement. If, in any arbitration or
judicial proceeding, an arbitrator or court, as applicable, shall refuse to
enforce one or more of the covenants or agreements contained in this Agreement
because the duration thereof is too long, the scope thereof is too broad or some
other reason, for the purpose of such arbitration or proceeding, the arbitrator
or court, as applicable, may reduce the duration or scope to the extent
necessary to permit the enforcement of such obligations and restrictions.

         23. Arbitration. Any and all disputes which may arise during the course
of this Agreement, or as a result of its termination or alleged breach by either
party (except for equitable or injunction actions or claims by Executive for
workers' compensation or unemployment compensation) shall be resolved by
arbitration. Such arbitration shall be held at Denver, Colorado before a single
arbitrator whose judgment shall be final and enforceable in either the District
Courts for the City and County of Denver or Boulder counties or the United
States District Court for Colorado. Either party may commence arbitration by the
filing of a demand and service of same under the notice provisions of Section
20. It is presumed that the forum for the arbitration will be the American
Arbitration Association at Denver unless the parties mutually agree to use
another arbitration service. The arbitrator shall be entitled, after
consideration of all facts and issues presented, to award the prevailing party
its costs, including attorneys fees, if the arbitrator feels such award is
appropriate under the circumstances.

         24. Headings. The headings in this Agreement are solely for convenience
of reference and shall not affect its interpretation.

         25. No Waiver. No failure on the part of any party hereto at any time
to require the performance by any other party of any term of this Agreement
shall be taken or held to be a

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waiver of such term or in any way affect such party's right to enforce such
term, and no waiver on the part of either party of any term of this Agreement
shall be taken or held to be a waiver of any other term hereof or the breach
thereof.

         26. Entire Agreement. This entire Agreement embodies the complete and
entire agreement and understanding of the parties with respect to the subject
matter hereof and supersedes all prior negotiations, whether written or oral,
relating to the subject matter hereof. To the extent that this Agreement
conflicts with any previous employment agreement entered into between Chaparral
and Gluck, the provisions of this Agreement shall control.

         27. Counterparts. This Agreement may be executed in separate
counterparts, each of which when so executed shall be an original but all of
such counterparts shall together constitute but one and the same instrument.

EXECUTED AND EFFECTIVE as of the date first written above.

-----------------------------------------------------------
Executive

CHAPARRAL NETWORK STORAGE, INC.

By:
   --------------------------------------------------------
   Gary L. Allison,      Chief Executive Officer and
                         Chairman of the Board of Directors

By:
   --------------------------------------------------------
   Jerry L. Walker,      Executive Vice President
                         Board of Directors Member

By:
   --------------------------------------------------------
   Michael J. Gluck      President and Chief
                         Operating Officer and
                         Board of Directors Member

By:
   --------------------------------------------------------
   F. Grant Saviers,     Board of Directors Member

By:
   --------------------------------------------------------
   Harris Ravine         Board of Directors Member

                                       10<PAGE>   1
                                                                    EXHIBIT 10.5

                            INDEMNIFICATION AGREEMENT

     Each of the following directors and officers of Chaparral Network Storage,
Inc. (the "Corporation") has executed an indemnification agreement with the
Corporation in a form substantially similar to the form attached hereto:

      1.  Gary L. Allison, Chairman of the Board and Chief Executive Officer.
      2.  Michael J. Gluck, President and Chief Operating Officer, Director.
      3.  Jerry L. Walker, Executive Vice President for Engineering and
          Operations, Director.
      4.  Douglas J. Lehrmann, Vice President, Finance and Chief Financial
          Officer.
      5.  Grant Saviers, Director.
      6.  Harris Ravine, Director.
<PAGE>   2

                         CHAPARRAL NETWORK STORAGE, INC.

                            INDEMNIFICATION AGREEMENT

         This Indemnification Agreement ("Agreement") is effective as of this
___ day of ______________, 2000, by and between Chaparral Network Storage, Inc.,
a Delaware corporation (the "Company"), and _________________ ("Indemnitee").

         WHEREAS, the Company and Indemnitee recognize the continued difficulty
in obtaining liability insurance for its directors, officers, employees, agents
and fiduciaries, the significant increases in the cost of such insurance and the
general reductions in the coverage of such insurance;

         WHEREAS, the Company and Indemnitee further recognize the substantial
increase in corporate litigation in general, subjecting directors, officers,
employees, agents and fiduciaries to expensive litigation risks at the same time
as the availability and coverage of liability insurance has been severely
limited;

         WHEREAS, the Company desires to attract and retain the services of
highly qualified individuals, such as Indemnitee, to serve the Company and, in
part, in order to induce Indemnitee to continue to provide services to the
Company, and the Company wishes to provide for the indemnification and advancing
of expenses to Indemnitee to the maximum extent permitted by law; and

         WHEREAS, in view of the considerations set forth above, the Company
desires that Indemnitee shall be indemnified by the Company as set forth herein.

         NOW, THEREFORE, the Company and Indemnitee hereby agree as follows:

1.       Indemnification.

             (a) Indemnification of Expenses. The Company shall indemnify
Indemnitee to the fullest extent permitted by law if Indemnitee was or is or
becomes a party to or witness or other participant in, or is threatened to be
made a party to or witness or other participant in, any threatened, pending or
completed action, suit, proceeding or alternative dispute resolution mechanism,
or any hearing, inquiry or investigation that Indemnitee in good faith believes
might lead to the institution of any such action, suit, proceeding or
alternative dispute resolution mechanism, whether civil, criminal,
administrative, investigative or other (hereinafter a "Claim") by reason of (or
arising in part out of) any event or occurrence related to the fact that
Indemnitee is or was a director, officer, employee, agent or fiduciary of the
Company, or any subsidiary of the Company, or is or was serving at the request
of the Company as a director, officer, employee, agent or fiduciary of another
corporation, partnership, joint venture, trust or other enterprise, or

                                      -2-
<PAGE>   3

by reason of any action or inaction on the part of Indemnitee while serving in
such capacity (hereinafter an "Indemnifiable Event") against any and all
expenses (including reasonable attorneys' fees and all other reasonable costs,
expenses and obligations incurred in connection with investigating, defending,
being a witness in or participant in, any such action, suit, proceeding,
alternative dispute resolution mechanism, hearing, inquiry or investigation),
judgments, fines, penalties and amounts paid in settlement (if such settlement
is approved in advance by the Company, which approval shall not be unreasonably
withheld) of such Claim and any federal, state, local or foreign taxes imposed
on the Indemnitee as a result of the actual or deemed receipt of any payments
under this Agreement (collectively, hereinafter "Expenses"), including all
interest, assessments and other charges paid or payable in connection with or in
respect of such Expenses. Such payment of Expenses shall be made from time to
time by the Company as soon as practicable but in any event no later than twenty
(20) days after any written demand by Indemnitee therefor is presented to the
Company.

             (b) Reviewing Party. Notwithstanding the foregoing, (i) the
obligations of the Company under Section 1(a) shall be subject to the condition
that the Reviewing Party (as described in Section 10(e) hereof) shall not have
determined (in a written opinion, in any case in which the Independent Legal
Counsel referred to in Section 1(c) hereof is involved) that Indemnitee would
not be permitted to be indemnified under applicable law, and (ii) the obligation
of the Company to make an advance payment of Expenses to Indemnitee pursuant to
Section 2(a) (an "Expense Advance") shall be subject to the condition that, if,
when and to the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under applicable law, the Company shall be
entitled to be reimbursed by Indemnitee (who hereby agrees to reimburse the
Company) for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced or thereafter commences legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, any determination made by the Reviewing Party
that Indemnitee would not be permitted to be indemnified under applicable law
shall not be binding and Indemnitee shall not be required to reimburse the
Company for any Expense Advance until a final judicial determination is made
with respect thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). Indemnitee's obligation to reimburse the Company for any
Expense Advance shall be unsecured and no interest shall be charged thereon. If
there has not been a Change in Control (as defined in Section 10(c) hereof), the
Reviewing Party shall be selected by the Board of Directors, and if there has
been such a Change in Control, the Reviewing Party shall be the Independent
Legal Counsel referred to in Section 1(c) hereof. If there has been no
determination by the Reviewing Party or if the Reviewing Party determines that
Indemnitee substantively would not be permitted to be indemnified in whole or in
part under applicable law, Indemnitee shall have the right to commence
litigation seeking an initial determination by the court or challenging any such
determination by the Reviewing Party or any aspect thereof, including the legal
or factual bases therefor, and the Company hereby consents to service of process
and to appear in any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and Indemnitee.

             (c) Change in Control. The Company agrees that if there is a Change
in Control of the Company then with respect to all matters thereafter arising
concerning the rights of Indemnitee to payments of Expenses and Expense Advances
under this Agreement or any other

                                      -3-
<PAGE>   4

agreement or under the Company's Certificate of Incorporation or Bylaws as now
or hereafter in effect, Independent Legal Counsel (as defined in Section 10(d)
hereof) shall be selected by Indemnitee and approved by the Company (which
approval shall not be unreasonably withheld). Such counsel, among other things,
shall render its written opinion to the Company and Indemnitee as to whether and
to what extent Indemnitee would be permitted to be indemnified under applicable
law and the Company agrees to abide by such opinion. The Company agrees to pay
the reasonable fees of the Independent Legal Counsel referred to above and to
fully indemnify such counsel against any and all expenses (including attorneys'
fees), claims, liabilities and damages arising out of or relating to this
Agreement or its engagement pursuant hereto.

             (d) Mandatory Payment of Expenses. Notwithstanding any other
provision of this Agreement other than Section 9 hereof, to the extent that
Indemnitee has been successful on the merits or otherwise, including, without
limitation, the dismissal of an action without prejudice, in defense of any
action, suit, proceeding, inquiry or investigation referred to in Section (1)(a)
hereof or in the defense of any claim, issue or matter therein, Indemnitee shall
be indemnified against all Expenses incurred by Indemnitee in connection
therewith.

2.       Expenses; Indemnification Procedure.

             (a) Advancement of Expenses. The Company shall advance all Expenses
incurred by Indemnitee. The advances to be made hereunder shall be paid by the
Company to Indemnitee from time to time as soon as practicable but in any event
no later than twenty (20) days after any written demand by Indemnitee therefor
to the Company.

             (b) Notice/Cooperation by Indemnitee. Indemnitee shall, as a
condition precedent to Indemnitee's right to be indemnified under this
Agreement, give the Company notice in writing as soon as practicable of any
Claim made against Indemnitee for which indemnification will or could be sought
under this Agreement. Notice to the Company shall be directed to the Chief
Executive Officer of the Company at the address shown on the signature page of
this Agreement (or such other address as the Company shall designate in writing
to Indemnitee). In addition, Indemnitee shall give the Company such information
and cooperation as it may reasonably require and as shall be within Indemnitee's
power.

             (c) No Presumptions; Burden of Proof. For purposes of this
Agreement, the termination of any Claim by judgment, order, settlement (whether
with or without court approval) or conviction, or upon a plea of nolo
contendere, or its equivalent, shall not create a presumption that Indemnitee
did not meet any particular standard of conduct or have any particular belief or
that a court has determined that indemnification is not permitted by applicable
law. In addition, neither the failure of the Reviewing Party to have made a
determination as to whether Indemnitee has met any particular standard of
conduct or had any particular belief, nor an actual determination by the
Reviewing Party that Indemnitee has not met such standard of conduct or did not
have such belief, prior to the commencement of legal proceedings by Indemnitee
to secure a judicial determination that Indemnitee should be indemnified under
applicable law, shall be a defense to Indemnitee's claim or create a presumption
that Indemnitee has not met any particular standard of conduct or did not have
any particular belief. In connection with any determination by the Reviewing
Party or otherwise as to whether the Indemnitee is entitled to be indemnified

                                      -4-
<PAGE>   5

hereunder, the burden of proof shall be on the Company to establish that
Indemnitee is not so entitled.

             (d) Notice to Insurers. If, at the time of the receipt by the
Company of a notice of a Claim pursuant to Section 2(b) hereof, the Company has
liability insurance in effect which may cover such Claim, the Company shall give
prompt notice of the commencement of such Claim to the insurers in accordance
with the procedures set forth in the respective policies. The 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 action,
suit, proceeding, inquiry or investigation in accordance with the terms of such
policies.

             (e) Selection of Counsel. In the event the Company shall be
obligated hereunder to pay the Expenses of any Claim, the Company, if
appropriate, shall be entitled to assume the defense of such Claim with counsel
approved by Indemnitee, which approval shall not be unreasonably withheld, upon
the delivery to Indemnitee of written notice of its election so to do. After
delivery of such notice, approval of such counsel by Indemnitee and the
retention of such counsel by the Company, the Company will not be liable to
Indemnitee under this Agreement for any fees of counsel subsequently incurred by
Indemnitee with respect to the same Claim; provided that, (i) Indemnitee shall
have the right to employ Indemnitee's counsel in any such Claim at Indemnitee's
expense and (ii) if (A) the employment of counsel by Indemnitee has been
previously authorized by the Company, (B) Indemnitee shall have reasonably
concluded that there may be a conflict of interest between the Company and
Indemnitee in the conduct of any such defense, or (C) the Company shall not
continue to retain such counsel to defend such Claim, then the reasonable fees
and expenses of Indemnitee's counsel shall be at the expense of the Company. The
Company shall have the right to conduct such defense as it sees fit, including
the right to settle any claim against Indemnitee without the consent of the
Indemnitee.

3.       Additional Indemnification Rights; Nonexclusivity.

             (a) Scope. The Company hereby agrees to indemnify the Indemnitee to
the fullest extent permitted by law, notwithstanding that such indemnification
is not specifically authorized by the other provisions of this Agreement, the
Company's Certificate of Incorporation, the Company's Bylaws or by statute. In
the event of any change after the date of this Agreement in any applicable law,
statute or rule which expands the right of a Delaware corporation to indemnify a
member of its board of directors or an officer, employee, agent or fiduciary, it
is the intent of the parties hereto that Indemnitee shall enjoy by this
Agreement the greater benefits afforded by such change. In the event of any
change in any applicable law, statute or rule which narrows the right of a
Delaware corporation to indemnify a member of its board of directors or an
officer, employee, agent or fiduciary, such change, to the extent not otherwise
required by such law, statute or rule to be applied to this Agreement, shall
have no effect on this Agreement or the parties' rights and obligations
hereunder except as set forth in Section 8(a) hereof.

             (b) Nonexclusivity. The indemnification provided by this Agreement
shall be in addition to any rights to which Indemnitee may be entitled under the
Company's Certificate of Incorporation, its Bylaws, any agreement, any vote of
stockholders or disinterested directors, the General Corporation Law of the
State of Delaware, or otherwise. The indemnification provided

                                      -5-
<PAGE>   6
under this Agreement shall continue as to Indemnitee for any action taken or not
taken while serving in an indemnified capacity even though Indemnitee may have
ceased to serve in such capacity.

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

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

6.       Mutual Acknowledgment. Both the Company and Indemnitee acknowledge that
in certain instances, federal law or applicable public policy may prohibit the
Company from indemnifying its directors, officers, employees, agents or
fiduciaries under this Agreement or otherwise. Indemnitee understands and
acknowledges that the Company has undertaken or may be required in the future to
undertake with the Securities and Exchange Commission to submit the question of
indemnification to a court in certain circumstances for a determination of the
Company's right under public policy to indemnify Indemnitee.

7.       Liability Insurance. The Company shall, from time to time, make the
good faith determination whether or not it is practicable for the Company to
obtain and maintain a policy or policies of insurance with reputable insurance
companies providing the officers and directors of the Company with coverage for
losses from wrongful acts, or to insure the Company's performance of its
indemnification obligations under this Agreement. Among other considerations,
the Company will weigh the costs of obtaining such insurance coverage against
the protection afforded by such coverage. In all policies of directors' and
officers' liability insurance, Indemnitee shall be named as an insured in such a
manner as to provide Indemnitee the same rights and benefits as are accorded to
the most favorably insured of the Company's directors, if Indemnitee is a
director; or of the Company's officers, if Indemnitee is not a director of the
Company but is an officer; or of the Company's key employees, if Indemnitee is
not an officer or director but is a key employee. Notwithstanding the foregoing,
the Company shall have no obligation to obtain or maintain such insurance if the
Company determines in good faith that such insurance is not reasonably
available, that the premium costs for such insurance are disproportionate to the
amount of coverage provided, that the coverage provided by such insurance is
limited by exclusions so as to provide an insufficient benefit, or that
Indemnitee is covered by similar insurance maintained by a subsidiary or parent
of the Company.

8.       Exceptions. Any other provision herein to the contrary notwithstanding,
the Company shall not be obligated pursuant to the terms of this Agreement:

             (a) Excluded Action or Omissions. To indemnify Indemnitee for
Expenses resulting from acts, omissions or transactions from which Indemnitee
may not be relieved of

                                      -6-
<PAGE>   7
liability under applicable law.

             (b) Claims Initiated by Indemnitee. To indemnify or advance
expenses to Indemnitee with respect to Claims initiated or brought voluntarily
by Indemnitee and not by way of defense, except (i) with respect to actions or
proceedings brought to establish or enforce a right to indemnification under
this Agreement or any other agreement or insurance policy or under the Company's
Certificate of Incorporation or Bylaws now or hereafter in effect relating to
Claims for Indemnifiable Events, (ii) in specific cases if the Board of
Directors has approved the initiation or bringing of such Claim, or (iii) as
otherwise as required under Section 145 of the Delaware General Corporation law,
regardless of whether Indemnitee ultimately is determined to be entitled to such
indemnification, advance expense payment or insurance recovery, as the case may
be.

             (c) Lack of Good Faith. To indemnify Indemnitee for any expenses
incurred by the Indemnitee with respect to any proceeding instituted by
Indemnitee to enforce or interpret this Agreement, if a court of competent
jurisdiction determines that each of the material assertions made by the
Indemnitee in such proceeding was not made in good faith or was frivolous; or

             (d) Claims Under Section 16(b). To indemnify Indemnitee for
expenses and the payment of profits arising from the purchase and sale by
Indemnitee of securities in violation of Section 16 of the Securities Exchange
Act of 1934, as amended, or any similar successor statute.

9.       Period of Limitations. No legal action shall be brought and no cause of
action shall be asserted by or in the right of the Company against Indemnitee,
Indemnitee's estate, spouse, heirs, executors or personal or legal
representatives after the expiration of two years from the date of accrual of
such cause of action, and any claim or cause of action of the Company shall be
extinguished and deemed released unless asserted by the timely filing of a legal
action within such two-year period; provided, however, that if any shorter
period of limitations is otherwise applicable to any such cause of action, such
shorter period shall govern.

10.      Construction of Certain Phrases.

             (a) For purposes of this Agreement, references to the "Company"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued, would
have had power and authority to indemnify its directors, officers, employees,
agents or fiduciaries, so that if Indemnitee is or was a director, officer,
employee, agent or fiduciary of such constituent corporation, or is or was
serving at the request of such constituent corporation as a director, officer,
employee, agent or fiduciary of another corporation, partnership, joint venture,
employee benefit plan, trust or other enterprise, Indemnitee shall stand in the
same position under the provisions of this Agreement with respect to the
resulting or surviving corporation as Indemnitee would have with respect to such
constituent corporation if its separate existence had continued.

             (b) For purposes of this Agreement, references to "other
enterprises" shall

                                      -7-
<PAGE>   8
include employee benefit plans; references to "fines" shall include any excise
taxes assessed on Indemnitee with respect to an employee benefit plan; and
references to "serving at the request of the Company" shall include any service
as a director, officer, employee, agent or fiduciary of the Company which
imposes duties on, or involves services by, such director, officer, employee,
agent or fiduciary with respect to an employee benefit plan, its participants or
its beneficiaries; and if Indemnitee acted in good faith and in a manner
Indemnitee reasonably believed to be in the interest of the participants and
beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have
acted in a manner "not opposed to the best interests of the Company" as referred
to in this Agreement.

             (c) For purposes of this Agreement a "Change in Control" shall mean
a change in ownership or control of the Company effected through any of the
following transactions:

                 (i) any "person" or "group" (within the meaning of
         Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934 (the
         "1934 Act")), other than a trustee or other fiduciary holding
         securities under an employee benefit plan of the Company, being or
         becoming the "beneficial owner" (as defined in Rule 13d-3 under the
         1934 Act), directly or indirectly, of greater than fifty percent (50%)
         of the outstanding voting stock of the Company; or

                 (ii) at any time during any period of three
         consecutive years (not including any period prior to the effective date
         of this Plan), individuals who at the beginning of such period
         constitute the Board of Directors (and any new director whose election
         by the Board or whose nomination for election by the Company's
         stockholders was approved by a vote of at least two-thirds of the
         directors then still in office who were either directors at the
         beginning of such period or whose election or nomination for election
         was previously so approved) ceasing for any reason to constitute a
         majority thereof; or

                 (iii) the stockholders of the Company approving a
         merger or consolidation of the Company with any other corporation,
         other than a merger or consolidation which would result in the voting
         securities of the Company outstanding immediately prior thereto
         continuing to represent (either by remaining outstanding or by being
         converted into voting securities of the surviving entity) at least 80%
         of the combined voting power of the voting securities of the Company or
         such surviving entity outstanding immediately after such merger or
         consolidation, or an agreement for the sale by the Company of all or
         substantially all of the Company's assets.

             (d) For purposes of this Agreement, "Independent Legal Counsel"
shall mean an attorney or firm of attorneys, selected in accordance with the
provisions of Section 1(c) hereof, who shall not have otherwise performed
services for the Company or Indemnitee within the last three years (other than
with respect to matters concerning the rights of Indemnitee under this
Agreement, or of other indemnitees under similar indemnity agreements).

             (e) For purposes of this Agreement, a "Reviewing Party" shall mean
any appropriate person or body consisting of a member or members of the
Company's Board of

                                      -8-
<PAGE>   9
Directors or any other person or body appointed by the Board of Directors who is
not a party to the particular Claim for which Indemnitee is seeking
indemnification, or Independent Legal Counsel.

             (f) For purposes of this Agreement, "Voting Securities" shall mean
any securities of the Company that vote generally in the election of directors.

11.      Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original.

12.      Binding Effect; Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the parties hereto and
their respective successors, assigns, including any direct or indirect successor
by purchase, merger, consolidation or otherwise to all or substantially all of
the business and/or assets of the Company, spouses, heirs, and personal and
legal representatives. The Company shall require and cause any successor
(whether direct or indirect by purchase, merger, consolidation or otherwise) to
all, substantially all, or a substantial part, of the business and/or assets of
the Company, by written agreement in form and substance satisfactory to
Indemnitee, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place. This Agreement shall continue in effect
regardless of whether Indemnitee continues to serve as a director of the Company
or of any other enterprise at the Company's request.

13.      Attorney's Fees. In the event that any action is instituted by
Indemnitee under this Agreement or under any liability insurance policies
maintained by the Company to enforce or interpret any of the terms hereof or
thereof, Indemnitee shall be entitled to be paid all Expenses incurred by
Indemnitee with respect to such action, regardless of whether Indemnitee is
ultimately successful in such action, and shall be entitled to the advancement
of Expenses with respect to such action, unless as a part to such action a court
of competent jurisdiction over such action determined that each of the material
assertions made by Indemnitee as a basis for such action were not made in good
faith or were frivolous. In the event of an action instituted by or in the name
of the Company under this Agreement to enforce or interpret any of the terms of
this Agreement, Indemnitee shall be entitled to be paid all Expenses incurred by
Indemnitee in defense of such action (including costs and expenses incurred with
respect to Indemnitee's counterclaims and cross-claims made in such action), and
shall be entitled to the advancement of Expenses with respect to such action,
unless as a part of such action a court having jurisdiction over such action
determines that each of Indemnitee's material defenses to such action was made
in bad faith or was frivolous.

14.      Notice. All notices and other communications required or permitted
hereunder shall be in writing, shall be effective when given, and shall in any
event be deemed to be given (a) five (5) days after deposit with the U.S. Postal
Service or other applicable postal service, if delivered by first-class mail,
postage prepaid, (b) upon delivery, if delivered by hand, (c) one business day
after the business day of deposit with Federal Express or similar overnight
courier, freight prepaid, or (c) upon delivery by facsimile transmission, if
delivered by facsimile transmission, with copy by first-class mail, postage
prepaid, and shall be addressed if to Indemnitee, at the Indemnitee's

                                      -9-
<PAGE>   10
address as set forth beneath Indemnitee's signature to this Agreement and if to
the Company at the address of its principal corporate offices (attention:
Secretary) or at such other address as such party may designate by ten days'
advance written notice to the other party hereto.

15.      Consent to Jurisdiction. The Company and Indemnitee each hereby
irrevocably consent to the jurisdiction of the courts of the State of Delaware
for all purposes in connection with any action or proceeding which arises out of
or relates to this Agreement and agree that any action instituted under this
Agreement shall be commenced, prosecuted and continued only in the Court of
Chancery of the State of Delaware in and for New Castle County, which shall be
the exclusive and only proper forum for adjudicating such a claim.

16.      Severability. The provisions of this Agreement shall be severable in
the event that any of the provisions hereof (including any provision within a
single section, paragraph or sentence) are held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.
Furthermore, to the fullest extent possible, the provisions of this Agreement
(including, without limitation, each portion of this Agreement containing any
provision held to be invalid, void or otherwise unenforceable, that is not
itself invalid, void or unenforceable) shall be construed so as to give effect
to the intent manifested by the provision held invalid, illegal or
unenforceable.

17.      Choice of Law. This Agreement shall be governed by and its provisions
construed and enforced in accordance with the laws of the State of Delaware, as
applied to contracts between Delaware residents, entered into and to be
performed entirely within the State of Delaware, without regard to the conflict
of laws principles thereof.

18.      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 documents required and shall do
all acts that may be necessary to secure such rights and to enable the Company
effectively to bring suit to enforce such rights.

19.      Amendment and Termination. No amendment, modification, termination or
cancellation of this Agreement shall be effective unless it is in writing signed
by both of 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.

20.      Integration and Entire Agreement. This Agreement sets forth the entire
understanding between the parties hereto and supersedes and merges all previous
written and oral negotiations, commitments, understandings and agreements
relating to the subject matter hereof between the parties hereto.

21.      No Construction as Employment Agreement. Nothing contained in this
Agreement shall be construed as giving Indemnitee any right to be retained in
the employ of the Company or any of its subsidiaries.

                                      -10-
<PAGE>   11

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

                                         CHAPARRAL NETWORK STORAGE, INC.

                                         By:
                                            ------------------------------------
                                         Name:
                                              ----------------------------------
                                         Title:
                                               ---------------------------------
                                         Address: 1951 S. Fordham Street
                                                  Longmont, Colorado  80503

AGREED TO AND ACCEPTED

INDEMNITEE:

Name:

(address)

                                      -11-

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