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                                                                  EXHIBIT 10.149


                            INDEMNIFICATION AGREEMENT


         THIS INDEMNIFICATION AGREEMENT, dated as of the 23rd day of September,
1998, between MEGO FINANCIAL CORP., a New York corporation (the "Company"), and
[NAME] (the "Indemnitee").


                                    RECITALS


         A. The Indemnitee is currently serving as a director and/or executive
officer of the Company and/or its subsidiaries and the Company desires to
continue to retain the services of the Indemnitee as a director and/or executive
officer of the Company and/or its subsidiaries and/or as a consultant to the
Company.

         B. The Company and the Indemnitee recognize the increased risk of
litigation and other claims being asserted against directors, officers and/or
employees of, and consultants to, public companies and the subsidiaries of such
companies.

         C. The Certificate of Incorporation and By-laws of the Company require
the Company to indemnify its directors and officers to the fullest extent
permitted by law and the Indemnitee has been serving and continues to serve as a
director and/or officer of the Company and/or its subsidiaries, in part, in
reliance on such provisions of the Certificate of Incorporation and By-laws.

         D. The Indemnitee has indicated that he does not regard the indemnities
available under the Company's Certificate of Incorporation and By-laws and
available insurance, if any, as adequate to protect him against the risks
associated with his services to the Company and/or its subsidiaries. As a
condition to the Indemnitee's agreement to continue to serve as such, the
Indemnitee requires that he be indemnified from liability in accordance with the
provisions of this Agreement to the fullest extent permitted by law.

         E. The Company recognizes that the Indemnitee needs substantial
protection against personal liability in order to maintain the Indemnitee's
continued service to the Company and/or its subsidiaries in an effective manner
and is willing to indemnify the Indemnitee in accordance with the provisions of
this Agreement to the fullest extent permitted by law in order to continue to
retain the services of the Indemnitee.

         F. The Company desires to provide in this Agreement for indemnification
of, and the advance of expenses to, Indemnitee to the fullest extent (whether
partial or complete) permitted by law, as set forth in this Agreement and, to
the extent officers' and directors' liability insurance is maintained by the
Company, to provide for the continued coverage of the Indemnitee under the
Company's officers' and directors' liability insurance policies, in part to
provide the Indemnitee with specific contractual assurance that the protection
promised by the indemnification provisions of the Certificate of Incorporation
and By-laws will be available to the Indemnitee 


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(regardless of, among other things, any amendment to or revocation of such
provisions of the Certificate of Incorporation or By-laws or any change in the
composition of the Company's Board of Directors or any acquisition transaction
relating to the Company).

         NOW, THEREFORE, for and in consideration of the premises and the mutual
covenants contained herein and the Indemnitee's past and continued service to
the Company, the Company and the Indemnitee agree as follows:

         SECTION 1. MANDATORY INDEMNIFICATION IN PROCEEDINGS OTHER THAN THOSE BY
THE COMPANY. Subject to Section 4 hereof, the Company shall indemnify and hold
harmless the Indemnitee from and against any and all claims, damages, expenses,
costs (including attorneys' fees and costs of other professionals), judgments,
penalties, fines (including excise taxes assessed with respect to an employee
benefit plan), settlements, and all other liabilities incurred or paid by him in
connection with the investigation, defense, prosecution, settlement or appeal
of, or being or preparing to be a witness in, or participating in, any
threatened, pending or completed action, suit, investigation that the Indemnitee
in good faith believes might lead to the institution of such action, or
proceeding, whether civil, criminal, administrative or investigative (other than
an action by the Company) and to which the Indemnitee was or is a party or is
threatened to be made a party or was or is a witness or participates or may
participate in by reason of the fact that the Indemnitee is or was an officer,
director, manager, consultant, stockholder, employee or agent of the Company or
any of its subsidiaries, or is or was serving at the request of the Company or
any of its subsidiaries as an officer, director, consultant, partner, trustee,
employee or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, or by reason of anything done or not
done by the Indemnitee in any such capacity or capacities, provided that the
Indemnitee acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the Company, and, with respect to any
criminal action or proceeding, did not know his conduct was unlawful.

         SECTION 2. MANDATORY INDEMNIFICATION IN PROCEEDINGS BY THE COMPANY.
Subject to Section 4 hereof, the Company shall indemnify and hold harmless the
Indemnitee from and against any and all expenses (including attorneys' fees) and
amounts actually and reasonably incurred or paid by him in connection with the
investigation, defense, prosecution, settlement or appeal of, or being or
preparing to be a witness in, or participating in, any threatened, pending or
completed action, suit, investigation that the Indemnitee in good faith believes
might lead to the institution of such action, or proceeding by the Company to
procure a judgment in its favor, whether civil, criminal, administrative or
investigative, and to which the Indemnitee was or is a party or is threatened to
be made a party or was or is a witness or participate or may participate in by
reason of the fact that the Indemnitee is or was an officer, director, manager,
consultant, stockholder, employee or agent of the Company or any of its
subsidiaries, or is or was serving at the request of the Company or any of its
subsidiaries as an officer, director, consultant, partner, trustee, employee or
agent of another corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise, or by reason of anything done or not done by
the Indemnitee in any such capacity or capacities, provided that (i) the
Indemnitee acted in good faith and in a manner he reasonably believed to be in
or not 


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opposed to the best interests of the Company and (ii) no indemnification shall
be made under this Section 2 in respect of any claim, issue or matter as to
which the Indemnitee shall have been adjudged to be liable to the Company
unless, and only to the extent that, the court in which such proceeding was
brought (or any other court of competent jurisdiction) shall determine upon
application that, despite the adjudication of such liability but in view of all
the circumstances of the case, the Indemnitee is fairly and reasonably entitled
to indemnity for such expenses which such court shall deem proper.

         SECTION 3. REIMBURSEMENT OF EXPENSES FOLLOWING ADJUDICATION FOR OTHER
THAN WILLFUL MISCONDUCT. The Company shall reimburse the Indemnitee for any
expenses (including attorney's fees) and amounts actually and reasonably
incurred or paid by him in connection with the investigation, defense,
settlement or appeal of any action, suit or proceeding described in Section 2
hereof that results in an adjudication that the Indemnitee was liable other than
for willful misconduct in the performance of his duty to the Company; provided,
however, that the Indemnitee acted in good faith and in a manner he believed to
be in the best interests of the Company.

         SECTION 4. AUTHORIZATION OF INDEMNIFICATION.

         4.1. Determination of Indemnification. Any indemnification under
Sections 1 and 2 hereof (unless ordered by a court) and any reimbursement made
under Section 3 hereof shall be made by the Company only as authorized in the
specific case upon a determination (the "Determination") that indemnification or
reimbursement of the Indemnitee is proper in the circumstances because the
Indemnitee has met the applicable standard of conduct set forth in subsection 1,
2 or 3 hereof, as the case may be. Subject to Sections 5.6, 5.7 and 8 of this
Agreement, the Determination shall be made in the following order of preference:

                  (1) first, by the Company's Board of Directors (the "Board")
by majority vote or consent of a quorum consisting of directors ("Disinterested
Directors") who are not, at the time of the Determination, named parties to such
action, suit or proceeding; or

                  (2) next, if such a quorum of Disinterested Directors cannot
be obtained or, even if obtainable, a quorum of Disinterested Directors so
directs, by the Board upon the opinion in writing of independent legal counsel
selected in accordance with Section 5.5, or

                  (3) next, if the Board declines or fails to make a
Determination within the time specified in Section 5.2, by any independent legal
counsel selected in accordance with Section 5.5.

         4.2. No Presumptions. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction, or upon a plea of nolo contendere or
its equivalent, shall not, of itself, create a presumption that the Indemnitee
did not act in good faith and in a manner that he reasonably believed to be in
or not opposed to the best interests of the Company, and with respect to any
criminal action or proceeding, knew that his conduct was unlawful.




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         4.3. Benefit Plan Conduct. The Indemnitee's conduct with respect to an
employee benefit plan for a purpose he reasonably believed to be in the
interests of the participants in and beneficiaries of the plan shall be deemed
to be conduct that the Indemnitee reasonably believed to be not opposed to the
best interests of the Company.

         4.4. Reliance as Safe Harbor. For purposes of any Determination
hereunder, the Indemnitee shall be deemed to have acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the Company, or, with respect to any criminal action or proceeding, to have had
no reasonable cause to believe or did not know his conduct was unlawful, if his
action is based on (i) the records or books of account of the Company or another
enterprise, including financial statements, (ii) information supplied to him by
the officers of the Company or another enterprise in the course of their duties,
(iii) the advice of legal counsel for the Company or another enterprise, or (iv)
information or records given or reports made to the Company or another
enterprise by an independent certified public accountant or by an appraiser or
other expert selected with reasonable care by the Company or another enterprise.
The term "another enterprise" as used in this Section 4.4 shall mean any other
corporation or any partnership, joint venture, trust, employee benefit plan or
other enterprise of which the Indemnitee is or was serving at the request of the
Company or any of its subsidiaries as an officer, director, consultant, partner,
trustee, employee or agent. The provisions of this Section 4.4 shall not be
deemed to be exclusive or to limit in any way the other circumstances in which
the Indemnitee may be deemed to have met the applicable standard of conduct set
forth in Sections 1, 2 or 3 hereof, as the case may be.

         4.5. Success on Merits or Otherwise. Notwithstanding any other
provision of this Agreement, to the extent that the Indemnitee has been
successful on the merits or otherwise in defense of any action, suit or
proceeding described in Section 1 or 2 hereof, or in defense of any claim, issue
or matter therein, he shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him in connection with the
investigation, defense, settlement or appeal thereof. For purposes of this
Section 4.5, the term "successful on the merits or otherwise" shall include, but
not be limited to, (i) any termination, withdrawal, or dismissal (with or
without prejudice) of any claim, action, suit or proceeding against the
Indemnitee without any express finding of liability or guilt against him, (ii)
the expiration of 120 days after the making of any claim or threat of an action,
suit or proceeding without the institution of the same and without any promise
or payment made to induce a settlement, or (iii) the settlement of any action,
suit or proceeding under Section 1, 2 or 3 hereof pursuant to which the
Indemnitee pays less than $100,000.

         4.6. Partial Indemnification or Reimbursement. If the Indemnitee is
entitled under any provision of this Agreement to indemnification and/or
reimbursement by the Company for some or a portion of the claims, damages,
expenses (including attorneys' fees and costs of other professionals),
judgments, fines or amounts paid in settlement by the Indemnitee in connection
with the investigation, defense, settlement or appeal of any action specified in
Section 1, 2 or 3 hereof, but not, however, for the total amount thereof, the
Company shall nevertheless indemnify and/or reimburse the Indemnitee for the
portion thereof to which the Indemnitee is entitled. The party or parties making
the Determination shall determine the portion (if less than all) of such 



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claims, damages, expenses (including attorneys' fees), judgments, fines or
amounts paid in settlement for which the Indemnitee is entitled to
indemnification and/or reimbursement under this Agreement.

         4.7. Subsidiary Conduct. The Indemnitee's conduct with respect to any
subsidiary of the Company for a purpose he reasonably believed to be in the
interests of the Company and/or any of its subsidiaries shall be deemed to be
conduct that the Indemnitee reasonably believed to be not opposed to the best
interests of the Company.

         SECTION 5. PROCEDURES FOR DETERMINATION OF WHETHER STANDARDS HAVE BEEN
SATISFIED.

         5.1. Costs. All costs of making any Determination required by Section 4
or 5 hereof shall be borne solely by the Company, including, but not limited to,
the costs of legal counsel and judicial determinations. The Company shall also
be solely responsible for paying (i) all reasonable expenses incurred by the
Indemnitee to enforce this Agreement, including, but not limited to, the costs
incurred by the Indemnitee to obtain court-ordered indemnification pursuant to
Section 8 hereof, regardless of the outcome of any such application or
proceeding, and (ii) all costs of defending any suits or proceedings challenging
payments to the Indemnitee under this Agreement.

         5.2. Timing of the Determination. The Company shall use its best
efforts to make the Determination contemplated by Section 4 or 5 hereof
promptly. In addition, the Company agrees:

                  (a) if the Determination is to be made by the Board pursuant
to subsection (1) of Section 4.1, such Determination shall be made not later
than 15 days after a written request for a Determination (a "Request") is
delivered to the Company by the Indemnitee; and

                  (b) if the Determination is to be made by the Board pursuant
to Sections 5.6 or 5.7 or subsection (2) of Section 4.1, such Determination
shall be made not later than 30 days after a Request is delivered to the Company
by the Indemnitee; and

                  (c) if the Determination is to be made by independent legal
counsel pursuant to subsection (3) of Section 4.1, such Determination shall be
made not later than 30 days after a Request is delivered to the Company by the
Indemnitee.

The failure to make a Determination within the above-specified time period shall
constitute a Determination approving full indemnification or reimbursement of
the Indemnitee. Notwithstanding anything herein to the contrary, the
Determination may be made in advance of (i) the Indemnitee's payment (or
incurring) of expenses with respect to which indemnification or reimbursement is
sought, and/or (ii) final disposition of the action, suit or proceeding with
respect to which indemnification or reimbursement is sought.

         5.3. Reasonableness of Expenses. The evaluation and finding as to the
reasonableness of expenses incurred by the Indemnitee for purposes of this
Agreement shall be made (in the 



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following order of preference) within 15 days of the Indemnitee's delivery to
the Company of a Request that includes a reasonable accounting of expenses
incurred:

                  (a) first, by the Board by a majority vote of a quorum
consisting of Disinterested Directors; or

                  (b) next, if a quorum cannot be obtained under subdivision
(a), by majority vote or consent of a committee duly designated by the Board (in
which designation all directors, whether or not Disinterested Directors, may
participate), consisting solely of two or more Disinterested Directors; or

                  (c) next, if such a committee cannot be designated, by any
independent legal counsel.

All expenses shall be considered reasonable for purposes of this Agreement if
the finding contemplated by this Section 5.3 is not made within the prescribed
time. The finding required by this Section 5.3 may be made in advance of the
payment (or incurring) of the expenses for which indemnification or
reimbursement is sought.

         5.4. Payment of Indemnified Amount. Immediately following a
Determination that the Indemnitee has met the applicable standard of conduct set
forth in Section 1, 2 or 3 hereof, as the case may be, and the finding of
reasonableness of expenses contemplated by Section 5.3 hereof, or the passage of
time prescribed for making such determination(s), the Company shall pay to the
Indemnitee in cash the amount to which the Indemnitee is entitled to be
indemnified and/or reimbursed, as the case may be, without further authorization
or action by the Board; provided, however, that the expenses for which
indemnification or reimbursement is sought have actually been incurred by the
Indemnitee.

         5.5. Selection of Independent Legal Counsel. If the Determination
required under Section 4 or 5 is to be made by or based upon the written opinion
of independent legal counsel, such counsel shall be selected by the Indemnitee
with the approval of the Board, which approval shall not be unreasonably
withheld. The fees and expenses incurred by counsel in making any Determination
(including Determinations pursuant to Sections 5.6 and 5.7 hereof) shall be
borne solely by the Company regardless of the results of any Determination and,
if requested by counsel, the Company shall give such counsel an appropriate
written agreement with respect to the payment of their fees and expenses and
such other matters as may be reasonably requested by counsel.

         5.6. Right of Indemnitee to Appeal an Adverse Determination by Board.
If a Determination is made by the Board or a committee thereof that the
Indemnitee did not meet the applicable standard of conduct set forth in Section
1, 2 or 3 hereof or that the Indemnitee's expenses are not reasonable as set
forth in Section 5.3 hereof, upon the written request of the Indemnitee and the
Indemnitee's delivery of $500 to the Company, the Company shall cause a new
Determination to be made by independent legal counsel, which independent legal
counsel shall be selected in accordance with Section 5.5. Subject to Section 8
hereof, such Determination 



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by such independent legal counsel shall be binding and conclusive for all
purposes of this Agreement.

         5.7. Right of Indemnitee To Select Forum For Determination. If, at any
time subsequent to the date of this Agreement, "Continuing Directors" do not
constitute a majority of the members of the Board, or there is otherwise a
change in control of the Company (as contemplated by Item 403(c) of Regulation
S-K), then the Determination required by Section 4 or 5 hereof shall be made by
independent legal counsel selected by the Indemnitee and approved by the Board
(which approval shall not be unreasonably withheld), which counsel shall be
deemed to satisfy the requirements of clause (3) of Section 4 and clause (c) of
Section 5.3 hereof. If none of the legal counsel selected by the Indemnitee are
willing and/or able to make the Determination, then the Company shall cause the
Determination to be made by a majority vote or consent of a Board committee
consisting solely of Continuing Directors. For purposes of this Agreement, a
"Continuing Director" means either a member of the Board at the date of this
Agreement or a person nominated to serve as a member of the Board by a majority
of the then Continuing Directors.

         5.8. Access by Indemnitee to Determination. The Company shall afford to
the Indemnitee and his representatives ample opportunity to present evidence of
the facts upon which the Indemnitee relies for indemnification or reimbursement,
together with other information relating to any requested Determination.

         5.9. Judicial Determinations in Suits by the Company. In each action or
suit described in Section 2 hereof, the Company shall cause its counsel to use
its best efforts to obtain from the Court in which such action or suit was
brought (i) an express adjudication whether the Indemnitee is liable for willful
misconduct in the performance of his duty to the Company, and, if the Indemnitee
is so liable, (ii) a determination whether and to what extent, despite the
adjudication of liability but in view of all the circumstances of the case
(including this Agreement), the Indemnitee is fairly and reasonably entitled to
indemnification.

         5.10. Burden of Proof. In the event of any claim by the Indemnitee for
indemnification hereunder, there shall be a presumption that the Indemnitee is
entitled to indemnification hereunder and the Company shall have the burden of
proving that the Indemnitee is not entitled to such indemnification.

         SECTION 6. SCOPE OF INDEMNITY. The actions, suits and proceedings
described in Sections 1 and 2 hereof shall include, for purposes of this
Agreement, any actions that involve, directly or indirectly, activities of the
Indemnitee both in his official capacities as a director or officer of, or
consultant to, the Company and/or any of its subsidiaries and actions taken in
another capacity while serving as director, officer or consultant, including,
but not limited to, actions or proceedings involving (i) compensation paid to
the Indemnitee by the Company and/or its subsidiaries, (ii) activities by the
Indemnitee on behalf of the Company, including actions in which the Indemnitee
is plaintiff, (iii) actions alleging a misappropriation of a "corporate
opportunity," (iv) responses to a takeover attempt or threatened takeover
attempt of the Company, (v) transactions by the Indemnitee in Company
securities, and (vi) the Indemnitee's 



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preparation for and appearance (or potential appearance) as a witness in any
proceeding relating, directly or indirectly, to the Company. In addition, the
Company agrees that, for purposes of this Agreement, all services performed by
the Indemnitee on behalf of, in connection with or related to any subsidiary of
the Company, any employee benefit plan established for the benefit of employees
of the Company or any subsidiary, any corporation or partnership or other entity
in which the Company or any subsidiary has a 5% ownership interest, any
homeowners or similar association on which the Indemnitee is serving at the
request of the Company or any of its subsidiaries, or any other affiliate shall
be deemed to be at the request of the Company.

         SECTION 7. ADVANCE FOR EXPENSES.

         7.1. Mandatory Advance. Expenses (including attorneys' fees) incurred
by the Indemnitee in investigating, defending, settling or appealing, or being
or preparing to be a witness in, any action, suit or proceeding described in
Section 1 or 2 hereof shall be paid by the Company in advance of the final
disposition of such action, suit or proceeding. The Company shall promptly pay
the amount of such expenses to the Indemnitee, but in no event later than 5 days
following the Indemnitee's delivery to the Company of a written request for an
advance pursuant to this Section 7, together with a reasonable accounting of
such expenses.

         7.2. Undertaking to Repay. The Indemnitee hereby undertakes and agrees
to repay to the Company any advances made pursuant to this Section 7 if and to
the extent that it shall ultimately be found that the Indemnitee is not entitled
to be indemnified by the Company for such amounts.

         7.3. Miscellaneous. The Company shall make the advances contemplated by
this Section 7 regardless of the Indemnitee's financial ability to make
repayment, and regardless whether indemnification of the Indemnitee by the
Company will ultimately be required. Any advances and undertakings to repay
pursuant to this Section 7 shall be unsecured and interest-free.

         SECTION 8. COURT-ORDERED INDEMNIFICATION. Regardless of whether the
Indemnitee has met the standard of conduct set forth in Sections 1, 2 or 3
hereof, as the case may be, and notwithstanding the presence or absence of any
Determination whether such standards have been satisfied and notwithstanding any
other provision hereof, the Indemnitee may apply for indemnification (and/or
reimbursement pursuant to Section 3 or 12 hereof) to the court conducting any
proceeding to which the Indemnitee is a party or a witness or to any other court
of competent jurisdiction. On receipt of an application, the court, after giving
any notice the court considers necessary, may order indemnification (and/or
reimbursement) if it determines the Indemnitee is fairly and reasonably entitled
to indemnification (and/or reimbursement) in view of all the relevant
circumstances (including this Agreement).

         SECTION 9. CONTRIBUTION. If and to the extent that a final adjudication
shall specify that the Company is not obligated to indemnify Indemnitee under
this Agreement for any reason (by reason of public policy, as a matter of law or
otherwise), then in respect of any threatened, pending or completed action, suit
or proceeding in which the Company is jointly 



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liable with Indemnitee (or would be so liable if joined in such action, suit or
proceeding), the Company shall contribute to the amount of expenses (including
attorneys' fees and costs of other professionals), judgments, penalties, fines
(including excise taxes assessed), settlements and all other liabilities
incurred and paid or payable by Indemnitee in connection with such action, suit
or proceeding in such proportion as is appropriate to reflect (i) the relative
benefits received by the Company on the one hand and Indemnitee on the other
hand from the transaction with respect to which such action, suit or proceeding
arose, and (ii) the relative fault of the Company on the one hand and of
Indemnitee on the other hand in connection with the circumstances which resulted
in such expenses, judgments, fines or settlement amounts, as well as any other
relevant equitable considerations. The relative fault of the Company on the one
hand and of Indemnitee on the other hand shall be determined by reference to
among other things, the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent the circumstances resulting in
such expense, judgments, fines or settlement amounts. The Company agrees that it
would not be just and equitable if contribution pursuant to this Section 9 were
determined by pro rata allocation or any other method of allocation which does
not take account of the foregoing equitable considerations.

         SECTION 10. NONDISCLOSURE OF PAYMENTS. Except as expressly required by
Federal securities laws, neither party shall disclose any payments under this
Agreement unless prior approval of the other party is obtained. Any payments to
the Indemnitee that must be disclosed shall, unless otherwise required by law,
be described only in Company proxy or information statements relating to special
and/or annual meetings of the Company's shareholders, and the Company shall
afford the Indemnitee the reasonable opportunity to review all such disclosures
and, if requested, to explain in such statement any mitigating circumstances
regarding the events reported.

         SECTION 11. COVENANT NOT TO SUE, LIMITATION OF ACTIONS AND RELEASE OF
CLAIMS. No legal action shall be brought and no cause of action shall be
asserted by or on behalf of the Company (or any of its subsidiaries) against the
Indemnitee, his spouse, heirs, executors, personal representatives or
administrators after the expiration of 2 years from the date the Indemnitee
ceases (for any reason) to serve as either an officer or a director of the
Company and/or its subsidiaries, and any claim or cause of action of the Company
(or any of its subsidiaries) shall be extinguished and deemed released unless
asserted by filing of a legal action within such 2-year period.

         SECTION 12. INDEMNIFICATION OF INDEMNITEE'S ESTATE. Notwithstanding any
other provision of this Agreement, and regardless whether indemnification of the
Indemnitee would be permitted and/or required under this Agreement, if the
Indemnitee is deceased, the Company shall indemnify and hold harmless the
Indemnitee's estate, spouse, heirs, administrators, personal representatives and
executors (collectively the "Indemnitee's Estate") against, and the Company
shall assume, any and all claims, damages, expenses, costs (including attorneys'
fees and costs of other professionals), penalties, judgments, fines and amounts
paid in settlement actually incurred by the Indemnitee or the Indemnitee's
Estate in connection with the investigation, defense, settlement or appeal of
any action described in Section 1 or 2 hereof. Indemnification of the
Indemnitee's Estate pursuant to this Section 12 shall be mandatory and not




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require a Determination or any other finding that the Indemnitee's conduct
satisfied a particular standard of conduct.

         SECTION 13. REIMBURSEMENT OF ALL LEGAL EXPENSES. Notwithstanding any
other provision of this Agreement, and regardless of the presence or absence of
any Determination, the Company promptly (but not later than 10 days following
the Indemnitee's submission of a reasonable accounting) shall reimburse the
Indemnitee for all attorneys' fees and related court costs and other expenses
incurred by the Indemnitee in connection with the investigation, defense,
settlement or appeal of or preparation to be a witness in or participating in
(including an appeal) or preparing to defend any action described in Section 1
or 2 hereof (including, but not limited to, the matters specified in Section 6
hereof).

         SECTION 14. MAINTENANCE OF INSURANCE. The Company represents that a
copy of the policies of directors and officers liability insurance that are in
effect are set forth as Exhibit A hereto. The Company hereby agrees that during
the period commencing on the date hereof and ending six years from the date the
Indemnitee ceases to serve the Company and/or its subsidiaries, the Company
shall purchase and maintain in effect for the benefit of the Indemnitee such
insurance providing coverage at least as favorable to the Indemnitee as that
presently provided, if such insurance can be purchased for premiums not in
excess of 200% of the amount of the current premiums, adjusted from time to time
in accordance with the Consumer Price Index, or, if such coverage cannot be
obtained, the maximum coverage that can be obtained for 200% of the amount of
the current premiums adjusted from time to time in accordance with the Consumer
Price Index.

         SECTION 15. CHANGES IN THE LAW. If any change after the date of this
Agreement in any applicable law, statute or rule or the Company's Certificate of
Incorporation or By-laws expands the power of the Company to indemnify the
Indemnitee, such change shall be within the purview of the Indemnitee's rights
and the Company's obligations under this Agreement. If any change in any
applicable law, statute or rule or the Company's Certificate of Incorporation or
By-laws narrows the right of the Company to indemnify a person such as the
Indemnitee, 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 thereunder.

         SECTION 16. MISCELLANEOUS.

         16.1. Notice Provision. Any notice, payment, demand or communication
required or permitted to be delivered or given by the provisions of this
Agreement shall be deemed to have been effectively delivered or given and
received on the date personally delivered to the respective party to whom it is
directed, or when deposited by registered or certified mail, with postage and
charges prepaid and addressed to the parties at the addresses set forth below
opposite their signatures to this Agreement.

         16.2. Entire Agreement. Except for the Company's Certificate of
Incorporation and By-laws solely to the extent that such instruments expand the
rights of the Indemnitee, this 



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Agreement constitutes the entire understanding of the parties and supersedes all
prior understandings, whether written or oral, between the parties with respect
to the subject matter of this Agreement. Without limiting the foregoing, it is
expressly agreed that the Indemnification Agreement dated as of March 26, 1998
between the Company and the Indemnitee is hereby terminated and superseded by
this Agreement. Nothing in this Agreement shall be deemed to limit any other
indemnification to which the Indemnitee may be entitled, including under the
Company's Certificate of Incorporation and By-laws, without duplication of
payment.

         16.3. Severability of Provisions. If any provision of this Agreement is
held to be illegal, invalid, or unenforceable under present or future laws
effective during the term of this Agreement, such provision shall be fully
severable; this Agreement shall be construed and enforced as if such illegal,
invalid, or unenforceable provision had never comprised a part of this
Agreement; and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid, or
unenforceable provision or by its severance from this Agreement. Furthermore, in
lieu of each such illegal, invalid, or unenforceable provision there shall be
added automatically as a part of this Agreement a provision as similar in terms
to such illegal, invalid or unenforceable provision as may be possible and be
legal, valid, and enforceable.

         16.4. Applicable Law. This Agreement shall be governed by and construed
under the laws of the State of New York.

         16.5. Execution in Counterparts. This Agreement and any amendment may
be executed simultaneously or in counterparts, each of which together shall
constitute one and the same instrument.

         16.6. Cooperation and Intent. The Company shall cooperate in good faith
with the Indemnitee and use its best efforts to ensure that the Indemnitee is
indemnified and/or reimbursed for liabilities described herein to the fullest
extent permitted by law.

         16.7. Amendment. No amendment, modification or alteration of the terms
of this Agreement shall be binding unless in writing, dated subsequent to the
date of this Agreement, and executed by the parties.

         16.8. Binding Effect. The obligations of the Company to the Indemnitee
hereunder shall survive and continue as to the Indemnitee even if the Indemnitee
ceases to be a director, officer, consultant, employee and/or agent of the
Company and/or its subsidiaries. Each and all of the covenants, terms and
provisions of this Agreement shall be binding upon and inure to the benefit of
the successors to the Company and, upon the death of the Indemnitee, to the
benefit of the estate, heirs, executors, administrators and personal
representatives of the Indemnitee.

         16.9. Nonexclusivity. The rights of indemnification and reimbursement
provided in this Agreement shall be in addition to any rights to which the
Indemnitee may otherwise be entitled by statute, bylaw, agreement, vote of
shareholders or otherwise.



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<PAGE>   12

         16.10. Effective Date. The provisions of this Agreement shall cover
claims, actions, suits and proceedings whether now pending or hereafter
commenced and shall be retroactive to cover acts or omissions or alleged acts or
omissions which heretofore have taken place.

         EXECUTED AS OF THE DATE FIRST ABOVE WRITTEN.

ADDRESS:                                   THE COMPANY:

4310 Paradise Road                         MEGO FINANCIAL CORP.
Las Vegas, Nevada  89109

Attention:  [ATTENTION]
                                           By:
                                              ----------------------------------
                                           Name:
                                                 -------------------------------
                                           Title:
                                                 -------------------------------

ADDRESS:                                   THE INDEMNITEE:



-------------------------------            -------------------------------------
                                           Name:       [NAME]
-------------------------------

-------------------------------


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