Indemnification Agreement - Micrel Inc. and George T. Anderl


                          INDEMNIFICATION AGREEMENT
                          -------------------------


     THIS AGREEMENT is entered into, effective as of June 3, 1996 by and between
MICREL, INCORPORATED, a California corporation (the "Company"), and George T.
Anderl ("Indemnitee").

     WHEREAS, it is essential to the Company to retain and attract as directors
and officers the most capable persons available;

     WHEREAS, Indemnitee is a director and/or officer of the Company;

     WHEREAS, both the company and Indemnitee recognize the increased risk of
litigation and other claims currently being asserted against directors and
officers of corporations; and

     WHEREAS, in recognition of Indemnitee's need for substantial protection
against personal liability in order to enhance Indemnitee's continued and
effective service to the Company, and in order to induce Indemnitee to provide
services to the Company as a director and/or officer, the Company wishes to
provide in this Agreement for the indemnification of and the advancing of
expenses to Indemnitee to the fullest extent (whether partial or complete)
permitted by California law and as set forth in this Agreement, and, to the
extent insurance is maintained, for the coverage of Indemnitee under the
Company's directors' and officers' liability insurance policies.

     NOW, THEREFORE, in consideration of the above premises and of Indemnitee's
continuing to serve the Company directly or, at its request, with another
enterprise, and intending to be legally bound hereby, the parties agree as
follows:

     1.   Certain Definitions:
          -------------------
       (a) Board:  the Board of Directors of the Company.

       (b) Change in Control: shall be deemed to have occurred if (I) any
"person" (as such term is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, as amended (the "Act"), other than a trustee or other
fiduciary holding securities under an employee benefit plan of the company or a
corporation owned directly or indirectly by the shareholders of the Company in
substantially the same proportions as their ownership of stock of the Company,
is or becomes the "Beneficial Owner" (as defined in Rule 13d-3 under the Act),
directly or indirectly, of securities of the company representing 30% or more of
the total voting power represented by the Company's then outstanding Voting
Securities, or (ii) during any period of two consecutive years, individuals who
at the beginning of such period constitute the Board and any new director whose
election by the Board or nomination for election by the Company's shareholders
was approved by a vote of at least two-thirds (2/3) of the directors then still
in office who either were directors at the beginning of the period of whose
election or nomination for election was previously so approved, cease for any
reason to constitute a majority of the Board, or, or (iii) the shareholders of
the Company approve a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation that 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 total voting
power represented by the Voting Securities of the Company or such surviving
entity outstanding immediately after such merger or consolidation, or (iv) the
shareholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or



                                      16




disposition by the Company (in one transaction or a series of transactions) of
all or substantially all of the Company's assets.

      (c) Expenses: any expense, liability, or loss, including attorneys' fees,
judgments, fines, ERISA excise taxes and penalties, amounts paid or to be paid
in settlement, any interest, assessments, or other charges imposed thereon, and
any federal, state, local, or foreign taxes imposed as a result of the actual or
deemed receipt of any payments under this Agreement, paid or incurred in
connection with investigating, defending, being a witness in, or participating
in (including on appeal), or preparing for any of the foregoing in, any
Proceeding relating to any Indemnifiable Event.

       (d) Indemnifiable Event:  any event or occurrence that takes place either
prior to or after the execution of this Agreement, related to the fact that
Indemnitee is or was a director or an officer of the company, or while a
director or officer is or was serving at the request of the Company as a
director, officer, employee, trustee, agent, or fiduciary of another foreign or
domestic corporation, partnership, joint venture, employee benefit plan, trust,
or other enterprise, or was a director, officer, employee, or agent of a foreign
or domestic corporation that was a predecessor corporation of the Company or of
another enterprise at the request of such predecessor corporation, or related to
anything done or not done by Indemnitee in any such capacity, whether or not the
basis of the Proceeding is alleged action in an official capacity as a director,
officer, employee, or agent or in any other capacity while serving as a
director, officer, employee, or agent of the Company, as described above.

      (e) Independent Counsel:  the person or body appointed in connection with
Section 3.

      (f) Potential Change in Control:  shall be deemed to have occurred if (I)
the Company enters into an agreement or arrangement, the consummation of which
would result in the occurrence of a Change in Control; (ii) any person
(including the Company) publicly announces an intention to take or to consider
taking actions that, if consummated, would constitute a Change in Control; (iii)
any person (other than a trustee or other fiduciary holding securities under an
employee benefit plan of the Company acting in such capacity or a corporation
owned, substantially the same proportions as their ownership of stock of the
Company), who is or becomes the Beneficial Owner, directly or indirectly, of
securities of the Company representing 10% or more of the combined voting power
of the Company's then outstanding Voting Securities, increase his beneficial
ownership of such securities by 5% or more over the percentage so owned by such
person on the date hereof, or (iv) the board adopts a resolution to the effect
that, for purposes of this Agreement, a Potential Change in Control has
occurred.

      (g) Proceeding:  (I) any threatened, pending, or completed action, suit,
or proceeding, or whether civil, criminal, administrative, investigative, or
other; (ii) any inquiry, hearing, or investigation, whether conducted by the
Company or any other party, that Indemnitee in good faith believes might lead to
the institution of any such action, suit, or proceeding.

      (h) Reviewing Party: the person or body appointed in accordance with
Section 3.

      (I) Voting Securities: any securities of the Company that vote generally
in the election of officers.

      2.   Agreement to Indemnify.
           ----------------------


                                       17




        (a) General Agreement.  In the event Indemnitee was, 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, a Proceeding by reason of (or arising in
part out of) an Indemnifiable Event, the company shall indemnify Indemnitee from
and against any and all Expenses to the fullest extent permitted by law, as the
same exits or may hereafter be amended or interpreted (but in the case of any
such amendment or interpretation, only to the extent that such amendment or
interpretation permits the company to provide broader indemnification rights
than were permitted prior thereto).  The parties hereto intend that this
Agreement shall provide for indemnification in excess of that expressly
permitted by statute, including, without limitation, any indemnification
provided by the Company's Articles of Incorporation, its bylaws, vote of its
shareholders or disinterested directors, or applicable law.

        (b) Initiation of Proceeding. Notwithstanding anything in this Agreement
to the contrary, Indemnitee shall not be entitled to indemnification pursuant to
this Agreement in connection with any Proceeding initiated by Indemnitee against
the Company or any director or officer of the Company unless (i) the Company has
joined in or the Board has consented to the initiation of such Proceeding; (ii)
the Proceeding is one to enforce indemnification rights under Section 5; or
(iii) the Proceeding is instituted after a Change in Control and Independent
Counsel has approved its initiation.

        (c) Expense Advances.  If so requested by Indemnitee, the Company shall
advance (within ten business days of such request) any and all Expenses to
Indemnitee (an "Expense Advance"); proved that, if 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.  If Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee should be
indemnified under applicable law, as provided in Section 4, 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 unit a final
judicial determination is made with respect thereto (as to which all rights of
appeal therefrom have been exhausted or have lapsed).  Indemnitee's obligation
to reimburse the Company for Expense Advances shall be unsecured and no interest
shall be charged thereon.

        (d) Mandatory Indemnification.  Notwithstanding any other provision of
this Agreement (other than Section 2(f) below), to the extent that Indemnitee
has been successful on the merits in defense or any Proceeding relating in whole
or in part to an Indemnifiable Event or in defense of any issue or matter
therein, Indemnitee shall be indemnified against all Expenses incurred in
connection therewith.

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

        (f) Prohibited Indemnification.  No indemnification pursuant to this
Agreement shall be paid by the Company on account of any Proceeding in which
judgment is rendered against Indemnitee for an accounting of profits made from
the purchase or sale by Indemnitee of securities of the Company pursuant to the
provisions of Section 16(b) of the Act or similar provisions of any federal,
state or local laws.



                                      18




      3.   Reviewing Party. Prior to any Change in Control, the Reviewing Party
shall be any appropriate person or body consisting of a member or members of the
Board or any other person or body appointed by the board who is not a party to
the particular Proceeding with respect to which Indemnitee is seeking
indemnification; after a Change in Control, the Reviewing Party shall be the
Independent Counsel referred to below.  With respect to all matters arising
after a Change in Control (other than a Change in Control approved by a majority
of the directors on the Board who were directors immediately prior to such
Change in Control) concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or under applicable
law or the company's Articles of Incorporation of bylaws now or hereafter in
effect relating to indemnification for Indemnifiable Events, the Company shall
seek legal advice only from Independent Counsel selected by Indemnitee and
approved by the Company (which approval shall not be unreasonably withheld), and
who has not otherwise performed services for the Company or the Indemnitee
(other than in connection with indemnification matters ) within the last five
years.  The Independent Counsel shall not include any person who, under the
applicable standards of professional conduct then prevailing, would have a
conflict of interest in representing either the Company or Indemnitee in an
action to determine Indemnitee's rights under this Agreement.  Such counsel,
among other things, shall render its written opinion to the Company and
Indemnitee as to whether and to what extent the Indemnitee should be permitted
to be indemnified under applicable law.  the Company agrees to pay the
reasonable fees of the Independent Counsel and to indemnify fully such counsel
against any and all expenses (including attorney's fees), claims, liabilities,
loss, and damages arising out of or relating to this Agreement or the engagement
of Independent Counsel pursuant hereto.

     4.   Indemnification Process and Appeal.
          ----------------------------------
         (a) Indemnification Payment.  Indemnitee shall be entitled to
indemnification of Expenses, and shall receive payment thereof, from the Company
in accordance with this Agreement as soon as practicable after Indemnitee has
made written demand on the company for indemnification, unless the Reviewing
Party has given a written opinion to the company that Indemnitee is not entitled
to indemnification under applicable law.

         (b) Suit to Enforce Rights.   Regardless of any action by the Reviewing
Party, if Indemnitee has not received full indemnification within thirty days
after making a demand in accordance with Section 4(a), Indemnitee shall have the
right to enforce its indemnification rights under this Agreement by commencing
litigation in any court in the State of California having subject matter
jurisdiction thereof and in which venue is proper seeking an initial
determination by the court or challenging any determination by the Reviewing
Party or any aspect thereof.  The Company hereby consents to service of process
and to appear in any such proceeding.  any determination by the Reviewing Party
not challenged by the Indemnitee shall be binding on the company and Indemnitee.
The remedy provided for in this Section 4 shall be in addition to any other
remedies available to Indemnitee in law or equity.

         (c) Defense to Indemnification, Burden of Proof, and Presumptions.  It
shall be a defense to any action brought by Indemnitee against the Company to
enforce this Agreement (other than an action brought to enforce a claim for
Expenses incurred in defending a Proceeding in advance of its final disposition
where the required undertaking has been tendered to the Company) that it is not
permissible under applicable law for the company to indemnify Indemnitee for the
amount claimed.  In connection with any such action or any determination by the
Reviewing Party or otherwise as to whether Indemnitee is entitled to be
indemnified hereunder, the burden of proving such a defense or


                                       19




determination shall be on the Company.  Neither the failure of the Reviewing
Party or the company (including its board, independent legal counsel, or its
shareholders) to have made a determination prior to the commencement of such
action by Indemnitee that indemnification of the claimant is proper under the
circumstances because Indemnitee has met the standard of conduct set forth in
applicable law, nor an actual determination by the Reviewing Party of Company
(including it Board, independent counsel, or its shareholders) that the
Indemnitee had not met such applicable standard of conduct, shall be a defense
to the action or create a presumption that the Indemnitee has not met the
applicable standard of conduct.  For purposes of this Agreement, the termination
of any claim, action, suit, or proceeding, by judgment, order settlement
(whether with or without court approval), 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.

      5. Indemnification for Expenses Incurred in Enforcing Rights.  The Company
shall indemnify Indemnitee against any and all Expenses and, if requested by
Indemnitee, shall (within ten business days of such request), advance such
Expenses to Indemnitee, that are incurred by Indemnitee in connection with any
claim asserted against or action brought by Indemnitee for

        (i) Indemnification of Expenses or Expense Advances by the Company under
this Agreement or any other agreement or under applicable law or the company's
Articles of Incorporation or Bylaws now or hereafter in effect relating to
indemnification for Indemnifiable Events, and/or

        (ii) recovery under directors' and officers' liability insurance
policies maintained by the Company, regardless of whether Indemnitee ultimately
is determined to be entitled to such indemnification, Expense Advances, or
insurance recovery, as the case may be.

     6.   Notification and Defense of Proceeding.
          ---------------------------------------
         (a) Notice.   Promptly after receipt by Indemnitee of notice of the
commencement of any Proceeding, Indemnitee shall, if a claim in respect thereof
is to be made against the Company under this Agreement, notify the Company of
the commencement thereof; but the omission so to notify the Company will not
relieve the Company from any liability that it may have to Indemnitee, except as
provided in Section 6(c).

         (b) Defense.  With respect to any Proceeding as to which Indemnitee
notifies the Company of the commencement thereof, the Company shall be entitled
to participate in the Proceeding at its own expense and except as otherwise
provided below, to the extent the Company so wishes, it may assume the defense
thereof with counsel reasonably satisfactory to Indemnitee.  After notice from
the Company to Indemnitee of its election to assume the defense of any
Proceeding, the Company shall not be liable to Indemnitee under this Agreement
or otherwise for any Expenses subsequently incurred by Indemnitee in connection
with the defense of such Proceeding other than reasonable costs of investigation
or as otherwise provided below.  Indemnitee shall have the right to employ his
or her own legal counsel in such Proceeding, but all Expenses related thereto
incurred after notice from the Company of its assumption of the defense shall be
at Indemnitee's expense unless:  (I) the employment of legal counsel by
Indemnitee has been authorized by the Company, (ii) Indemnitee has reasonably
determined that there may be a conflict of interest between Indemnitee and the
Company in the defense of the Proceeding, (iii) after a Change in Control, the
employment of counsel by Indemnitee has been approved by the Independent
Counsel, or (iv) the Company shall not in fact have employed counsel to assume
the defense of such Proceeding, in each of which case all Expenses of the
Proceeding


                                       20




shall be borne by the company.  The company shall not be entitled to assume the
defense of any Proceeding brought by or on behalf of the Company or as to which
Indemnitee shall have made the determination provided for in (ii) above.

          (c) Settlement of Claims.  The Company shall not be liable to
indemnify Indemnitee under this Agreement or otherwise for any amounts paid in
settlement of any Proceeding effected without the Company's written consent,
provided, however, that if a Change in Control has occurred, the Company shall
be liable for indemnification of Indemnitee for amounts paid in settlement if
the Independent counsel has approved the settlement.  The Company shall not
settle any Proceeding in any manner that would impose any penalty or limitation
on Indemnitee without Indemnitee's written consent.  Neither the Company nor the
Indemnitee will unreasonably withhold their consent to any proposed settlement.
The Company shall not be liable to indemnify the Indemnitee under this Agreement
with regard to any judicial award if the Company was not given a reasonable and
timely opportunity, at its expense, to participate in the defense of such
action; the Company's liability hereunder shall not be excused if participation
in the Proceeding by the Company was barred by this Agreement.

     7.   Establishment of Trust.  In the event of a Change in Control or a
Potential Change in Control, the Company shall, upon written request by
Indemnitee, create a Trust for the benefit of the Indemnitee and from time to
time upon written request of Indemnitee shall fund the Trust in an amount
sufficient to satisfy any and all Expense reasonably anticipated at the time of
each such request to be incurred in connection with investigating, preparing
for, participating in, and/or defending any Proceeding relating to an
Indemnifiable Event.  The amount or amounts to be deposited in the Trust
pursuant to the foregoing funding obligation shall be determined by the
Reviewing Party.  The terms of the Trust shall provide that upon a Change in
Control, (I) the Trust shall not be revoked or the principal thereof invaded,
without the written consent of the Indemnitee, (ii) the Trustee shall advance,
within ten business days of a request by the Indemnitee, any and all Expenses to
the Indemnitee (and the Indemnitee hereby agrees to reimburse the Trust under
the same circumstances for which the Indemnitee would be required to reimburse
the Company under Section 2(c) of this Agreement), (iii) the Trust shall
continue to be funded by the Company in accordance with the funding obligation
set forth above, (iv) the Trustee shall promptly pay to the Indemnitee all
amounts for which the Indemnitee shall be entitled to indemnification pursuant
to this Agreement or otherwise, and (v) all unexpended funds in the Trust shall
revert to the Company upon a final determination by the Reviewing Party or a
court of competent jurisdiction, as the case may be, that the Indemnitee has
been fully indemnified under the terms of this Agreement.  The Trustee shall be
chosen by the Indemnitee.  Nothing in this Section 7 shall relieve the Company
of any of its obligations under this Agreement.  All income earned on the assets
held in the Trust shall be reported as income by the Company for federal, state,
local, and foreign tax purposes.  The Company shall pay all costs of
establishing and maintaining the Trust and shall indemnify the Trustee against
any and all expenses (including attorneys' fees), claims, liabilities, loss, and
damages arising out of or relating to this Agreement or the establishment and
maintenance of the Trust.

     8.   Non-Exclusivity.  The rights of Indemnitee hereunder shall be in
addition to any other rights Indemnitee may have under the Company's Articles of
Incorporation, Bylaws, applicable law, or otherwise.  To the extent that a
change in applicable law (whether by statute or judicial decision) permits
greater indemnification by agreement than would be afforded currently under the
Company's Articles of Incorporation, Bylaws, applicable law, or this Agreement,
it is the intent of the parties that Indemnitee enjoy by this Agreement the
greater benefits so afforded by such change.

     9.   Liability Insurance.  To the extent the company maintains an insurance
policy or policies providing directors' and officers' liability insurance,
Indemnitee shall be covered by



                                       21




such policy or policies, in accordance with its or their terms, to the maximum
extent of the coverage available for any Company director or officer.

     10.   Period of Limitations.  No legal action shall be brought and no cause
of action shall be asserted by or on behalf of the company or any affiliate of
the Company against Indemnitee, Indemnitee's spouse, heirs, executors, or
personal or legal representatives after the expiration of two years from the
date of accrual of such cause of action, or such longer period as may be
required by state law under the circumstances.  Any claim or cause of action of
the Company or its affiliate shall be extinguished and deemed released unless
asserted by the timely filing of a legal action within such period; provided,
however that if any shorter period of limitations is otherwise applicable to any
such cause of action the shorter period shall govern.

     11.   Amendment of this Agreement. No supplement, modification, or
amendment of this Agreement shall be binding unless executed in writing by both
of the parties hereto.  No waiver of any of the provisions of this Agreement
shall operate as a waiver of any other provisions hereof (whether or not
similar), nor shall such waiver constitute a continuing waiver.  Except as
specifically provided herein, no failure to exercise or any delay in exercising
any right or remedy hereunder shall constitute a waiver thereof.

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

     13.   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 received payment (under any
insurance policy, Bylaw, or otherwise) of the amounts otherwise Indemnifiable
hereunder.

     14.   Binding Effect. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors (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), assigns, 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.  The indemnification provided under this Agreement
shall continue as to Indemnitee for any action taken or not taken while serving
in an indemnified capacity pertaining to an Indemnifiable Event even though he
or she may have ceased to serve in such capacity at the time of any Proceeding.

     15.   Severability.  If any provision (or portion thereof) of this
Agreement shall be held by a court of competent jurisdiction to be invalid,
void, or otherwise unenforceable, the remaining provision 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


                                       22




invalid, void, or unenforceable) shall be construed so as to give effect to the
intent manifested by the provision held invalid, void, or unenforceable.

     16.   Governing Law. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of California applicable to
contracts made and to be performed in such State without giving effect to the
principles of conflicts of laws.

     17.   Notices.  All notices, demands, and other communications required or
permitted hereunder shall be made in writing and shall be deemed to have been
duly given if delivered  by hand, against receipt, or mailed, postage prepaid,
certified or registered mail, return receipt requested, and addressed to the
Company at:

           Micrel, Incorporated
           1849 Fortune Drive
           San Jose, California   95131
           Attn:  President

and to Indemnitee at:
           George T. Anderl
           10205 Avocado Place
           Cupertino,  CA  95014
           Attn:

     Notice of change of address shall be effective only when given in
accordance with this Section.  All notices complying with this Section shall be
deemed to have been received on the date of delivery or on the third business
day after mailing.

     18.   Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

     IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the day specified above.

                                            MICREL, INCORPORATED
                                            By:     /S/  Warren H. Muller
                                                    ----------------------
                                            Title:  Vice President, Secretary

                                            INDEMNITEE:
                                            /S/ George T. Anderl
                                            -----------------------------
                                            George T. Anderl

                                       23