Document:

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                                                                    EXHIBIT 10.1

                              Employment Agreement
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                                  CONFIDENTIAL

         THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into on
the _____ day of _________________, 2002, by and between Syntroleum Corporation,
a Delaware  corporation (the "Company"),  and John B. Holmes, Jr., an individual
(the "Employee").

         WHEREAS, the Company desires to enter into an employment relationship
with Employee and Employee is willing to accept such employment on the terms and
conditions set forth herein.

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter contained, the Company and Employee hereby agree as follows.

         1.  Employment and Duties. The Company employs Employee in the capacity
of President/Chief Operating Officer, or in such other position and at such
location as the Company may direct or desire and Employee hereby accepts such
employment, on the terms and conditions hereinafter set forth. Employee agrees
to perform such services and duties (including reasonable travel) and hold such
offices at such locations as may be reasonably assigned to him from time to time
by the Company and to devote substantially his full business time, energies and
best efforts to the performance thereof to the exclusion of all other business
activities, except any activities disclosed to the Company in advance and
consented to by the Company.

         2.  Compensation.  As compensation for the services to be rendered by
Employee to the Company  pursuant to this Agreement, Employee shall be paid the
following compensation and other benefits.

         (a) Salary in the amount of $19,166.67 per month, payable in equal
semi-monthly installments in arrears, or such higher compensation as may be
established by the Company from time to time. Payments of salary shall be made
in accordance with the Company's usual payroll procedures.

         (b) Employee shall be eligible to participate, to the extent he may be
eligible, in any group medical and hospitalization, profit sharing, retirement,
life insurance or other employee benefit plans which the Company may from time
to time offer to its employees. All group insurance provided to Employee shall
be in such form and provide such coverage as is provided to other employees of
the Company.

         (c) All compensation payments to Employee shall be made subject to
normal deductions therefrom, including federal and state social security and
withholding taxes.

         3.  Life Insurance. The Company, in its discretion, may apply for and
procure in its own name and for its own benefit, life insurance on the life of
Employee in any amount or amounts considered advisable by the Company. Employee
shall submit to any medical or other examination and execute and deliver any
application or other instrument in writing, reasonably necessary for the Company
to acquire such insurance.

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

         4.  Expenses. The Company shall reimburse Employee for his actual
out-of-pocket expenses incurred in carrying out his duties hereunder in the
conduct of the Company's business, which expenses shall be limited to ordinary
and necessary items and which shall be supported by vouchers, receipts or
similar documentation submitted in accordance with the Company's expense
reimburse policy and as required by law.

         5.  Vacations and Leave.  Employee  shall be entitled to vacation and
leave in accordance with the Company's policies in effect from time to time.

         6.  Non-Disclosure of Confidential Information.

         (a) Employee acknowledges that in and as a result of his employment by
the Company, he will be making use of, acquiring, and/or adding to the Company's
Trade Secret Information. Except as required in the performance of Employee's
duties under this Agreement, Employee will not use any Trade Secret Information
of the Company for Employee's own benefit or purposes or disclose to third
parties, directly or indirectly, any Trade Secret Information of the Company,
either during or after Employee's employment with the Company.

         (b) As used in this Agreement, "Trade Secret Information" means
information, including, but not limited to, any formula, pattern, compilation,
program, device, method, technique or process, that: (i) derives independent
economic value, actual or potential, from not being generally known to, and not
being readily ascertainable by proper means by other persons who can obtain
economic value from its disclosure or use, and (ii) is the subject of efforts
that are reasonable under the circumstances to maintain its secrecy. For
purposes of this Agreement, "Trade Secret Information" includes both information
disclosed to Employee by the Company and information developed by Employee in
the course of his employment with the Company. The types and categories of
information which are considered to be Trade Secret Information include, without
limitation: (a) specifications, descriptions, designs, dimensions, content
(including chemical composition) and tolerances of products, parts and
components; (b) plans, blueprints, design packages construction, part and
assembly drawings and diagrams; (c) design, construction and component costs and
cost estimates; (d) the existence, terms or conditions of any agreements
(including license agreements) between the Company and any third party; (e)
computer programs (whether in the form of source code, object code or any other
form, including software, firmware and programmable array logic), formulas,
algorithms, methods, techniques, processes, designs, specifications, diagrams,
flow charts, manuals, descriptions, instructions, explanations, improvements,
and the ideas, systems and methods of operation contained in such programs; (f)
information concerning or resulting from research and development work performed
by the Company; (g) information concerning the Company's management, financial
condition, financial operations, purchasing activities, sales activities,
marketing activities and business plans; (h) information acquired or compiled by
the Company concerning actual or potential customers;

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

and (i) all other types and categories of information (in whatever form) with
respect to which, under all the circumstances, Employee knows or has reason to
know that the Company intends or expects secrecy to be maintained and as to
which the Company has made reasonable efforts to maintain its secrecy.

         (c) In the event that Employee is requested or required by applicable
law or by deposition, interrogatory, request for documents, subpoena, civil
investigative demand or similar process to disclose any of the Company's Trade
Secret Information, Employee shall provide the Company with prompt written
notice of such request or requirement prior to making the requested disclosure,
and shall cooperate with the Company so that the Company may seek to protect the
proprietary nature of such Trade Secret Information through available
procedures, including a protective order or other appropriate remedy.

         (d) The Company may also advise Employee from time to time as to
restrictions upon the use or disclosure of specified information which has been
licensed or otherwise disclosed to the Company by third parties pursuant to
license or confidential disclosure agreements which contain restrictions upon
the use or disclosure of such information. Employee agrees to abide by the
restrictions upon use and/or disclosure contained in such agreements.

         (e) Employee has not and will not use or disclose to the Company any
confidential or proprietary information belonging to others without the written
consent of the person to whom such information is confidential, and Employee
represents that his employment with the Company will not require the use of such
information or the violation of any confidential relationship with any third
party.

         7.  Other Property of the Company. All documents, encoded media, and
other tangible items provided to Employee by the Company or prepared, generated
or created by Employee or others in connection with any business activity of the
Company are the property of the Company. Upon termination of Employee's
employment with the Company, Employee will promptly deliver to the Company all
such documents, media and other items in his possession, including all complete
or partial copies, recordings, abstracts, notes or reproductions of any kind
made from or about such documents, media, items or information contained
therein. Employee will neither have nor claim any right, title or interest in
any trademark, service mark or trade name owned or used by the Company.

         8.  Inventions and Works of Authorship.

         (a) Employee agrees to assign and hereby irrevocably assigns to the
Company all of Employee's right, title and interest in and to any and all
Inventions and Works of Authorship made, generated or conceived by Employee
during the period of his employment with the Company, and Employee agrees to and
shall promptly disclose all such Inventions and Works of Authorship to the
Company in writing. As used herein, "Invention" means any

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

discovery, improvement, innovation, idea, formula, or shop right (whether or not
patentable, whether or not put into writing and whether or not put into
practice) made, generated or conceived by Employee (whether alone or with
others) while employed by the Company. For purposes of this Agreement, any
discovery, improvement, innovation, idea, formula, or shop right (whether or not
patentable, whether or not put into writing and whether or not put into
practice) relating directly or indirectly to the business of the Company or to
the Company's actual or demonstrably anticipated business, research or
development with respect to which Employee files a patent application within two
years after termination of employment with the Company shall be presumed to be
an Invention. As used herein, "Work of Authorship" means any original work of
authorship within the purview of the copyright laws of the United States of
America, and both the Company and Employee intend and agree that all Works of
Authorship created by Employee in the course of his employment with the Company
will be and shall constitute works made for hire within the meaning and purview
of such copyright laws.

         (b) Employee will execute and assign any and all applications,
assignments, and other documents and will render all assistance which may be
reasonably necessary for the Company to obtain patent, copyright, or any other
form of intellectual property protection with respect to all Inventions and
Works of Authorship in all countries and will cooperate with Syntroleum as
reasonably necessary to enforce any such intellectual property protection. The
Company will pay Employee $200 for each patent issued to the Company upon which
Employee's name appears as an inventor.

         (c) The provisions of this Paragraph 8 do not apply to an invention for
which no equipment, supplies, facility or Trade Secret Information of the
Company was used and which was developed entirely on Employee's own time, and
which does not relate (i) directly or indirectly to the business, research or
development of the Company, or (ii) to the Company's actual or demonstrably
anticipated business, research or development. A reasonable determination of the
applicability of this Paragraph 8(a) to an Employee's invention shall be made by
Syntroleum after the Employee submits notification in writing of the invention.
Said notice shall include adequate detail for Syntroleum to evaluate the
invention.

         9.  Limited Covenants Against Competition; Non-Solicitation.

         (a) Employee acknowledges that the services he is to render to the
Company are of a special and unusual character with a unique value to the
Company, the loss of which cannot adequately be compensated by damages in an
action at law. In view of the unique value to the Company of the services of
Employee and because of the confidential Trade Secret Information to be obtained
by or disclosed to Employee, as set forth above, and as a material inducement to
the Company to enter into this Agreement and to pay to Employee the compensation
stated in Paragraph 2, Employee covenants and agrees that during the period of
Employee's employment within the Company and for a period of two years following

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

termination of Employee's employment with the Company for any reason,
voluntarily or involuntarily, Employee will not directly or indirectly: (i)
start or participate or assist (as a proprietor, partner, shareholder, lender,
investor, director, employee, consultant, independent contractor or otherwise)
in starting any Competing Business; (ii) assist (as a proprietor, partner,
shareholder (except as a holder of 1% or less of the outstanding voting
securities or income interest), lender, investor (except as a holder of 1% or
less of the outstanding voting securities or income interest), director,
employee, consultant, independent contractor or otherwise) any existing
Competing Business in the design, development or manufacture of any Competing
Product; (iii) sell or assist in the sale of any Competing Product to any person
or organization with whom Employee had any contact while employed with the
Company; (iv) directly or indirectly solicit for employment or employ any of the
Company's employees; or (v) become employed by a former employee of the Company.
Because Syntroleum actively pursues opportunities throughout the world and is
engaged in a world-wide oriented business the Employee acknowledges the
reasonableness of having no geographic limitation hereunder.

         (b) Employee further acknowledges that, while employed by the Company,
he will have contact with and become aware of the Company's customers and
licensees and their respective representatives, including their names and
addresses, specific needs and requirements, as well as leads and references to
prospective customers and licensees. Employee further acknowledges that loss of
such customers or licensees would cause the Company great and irreparable harm.
Employee agrees that for a period of two years following termination of
Employee's employment with the Company for any reason, voluntarily or
involuntarily, Employee will not directly or indirectly solicit, contact, call
upon, communicate with or attempt to communicate with any customer or licensee,
former customer or licensee, or prospective customer or licensee of the Company
for the purpose of selling, installing, implementing, or modifying any Competing
Product. This restriction shall apply only to any customer or licensee, former
customer or licensee, or prospective customer or licensee of the Company with
whom Employee had contact during the last two years of Employee's employment
with the Company.

         (c) The Employee agrees that for as long as he is employed by the
Company and for a period of two years after termination of Employee's employment
with the Company for any reason, voluntarily or involuntarily, Employee will not
solicit, recruit, hire or attempt to solicit, recruit or hire, directly or by
assisting others, any other employee of the Company.

         (d) As used in this Agreement, (i) "Competing Business" means any
person, entity or organization other than the Company which is engaged in or is
about to become engaged in the design, manufacture or sale of a Competing
Product, (ii) "Competing Product" means any product (including, without
limitation, any chemical formula or process) which is or may be marketed in
competition with any product marketed or under development by the Company at any
time, and (iii) "contact" means interaction between Employee and a customer or
licensee, former customer or licensee, or prospective customer or licensee of
the

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

Company, which takes place to further any business relationship; or performing
services for the customer or licensee, former customer or licensee, or
prospective customer or licensee on behalf of the Company.

         10. Reasonableness of Restrictions.

         (a) Employee expressly acknowledges that he has carefully read and
considered the provisions of Paragraphs 6, 7, 8 and 9, and, having done so,
agrees that the restrictions set forth in these Paragraphs, including, but not
limited to, the time periods and geographic areas of restriction are fair and
reasonable and are reasonably required for the protection of the interests of
the Company and its officers, directors, shareholders and other employees.

         (b) In the event that, notwithstanding the foregoing, any of the
provisions of Paragraphs 6, 7, 8 and 9 shall be held to be invalid or
unenforceable, the remaining provisions thereof shall nevertheless continue to
be valid and enforceable as though the invalid or unenforceable parts had not
been included therein. In the event that any provision of Paragraphs 6, 7, 8 and
9 relating to the time period and/or the areas of restriction and/or related
aspects shall be declared by a court of competent jurisdiction to exceed the
maximum restrictiveness such court deems reasonable and enforceable, the time
period and/or areas of restriction and/or related aspects deemed reasonable and
enforceable by the court shall become and thereafter be the maximum restriction
in such regard, and the restriction shall remain enforceable to the fullest
extent deemed reasonable by such court.

         11. Requests for Clarification. In the event Employee is uncertain as
to the meaning of any provision of this Agreement or its application to any
particular information, item or activity, Employee will inquire in writing to
the Company, specifying any areas of uncertainty. The Company will respond in
writing within a reasonable time and will endeavor to clarify any areas of
uncertainty, including such things as whether it considers particular
information to be its Trade Secret Information or whether it considers any
particular activity or employment to be in violation of this Agreement.

         12. Remedies. In the event of a breach or threatened breach of any of
the covenants in Paragraphs 6, 7, 8 and 9, the Company shall have the right to
seek monetary damages and equitable relief, including specific performance by
means of an injunction against Employee or against Employee's partners, agents,
representatives, servants, employers, employees, family members and/or any and
all persons acting directly or indirectly by or with him, to prevent or restrain
any such breach.

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                                  CONFIDENTIAL

         13. Term and Termination.

         (a) The term of this Agreement shall be for an initial term of 12
months from the effective date hereof, unless sooner terminated as provided
herein, and shall thereafter be automatically renewed for successive terms of 12
months each unless sooner terminated as provided herein.

         (b) Employment of Employee under this Agreement may be terminated:

               (i) by the Company upon the death of Employee.

               (ii) by the Company if Employee becomes disabled. For the
         purposes of this Agreement, Employee will be deemed disabled if he (i)
         has been declared legally incompetent by a final court decree (the date
         of such decree being deemed to be the date on which the disability
         occurred), or (ii) receives disability insurance benefits from any
         disability income insurance policy maintained by the Company for a
         period of three consecutive months, or (iii) has been found to be
         disabled pursuant to a disability determination. A "disability
         determination" means a finding that Employee, because of a medically
         determinable disease, injury, or other mental or physical disability,
         is unable to perform substantially all of his regular duties to the
         Company and that such disability is determined or reasonably expected
         to last at least six months. The disability determination shall be
         based upon the written opinion of the physician regularly attending
         Employee whose disability is in question. If the Company disagrees with
         the opinion of this physician (the "First Physician"), it may engage,
         at its own expense, another physician of its choice (the "Second
         Physician") to examine Employee. If the First and Second Physicians
         agree in writing that Employee is or is not disabled, their written
         opinion shall, except as otherwise set forth in this subsection, be
         conclusive on the issue of disability. If the First and Second
         Physicians disagree on the disability of Employee, they shall choose a
         third consulting physician (whose expense shall be borne by the
         Company), and the written opinion of a majority of these three
         physicians shall, except as otherwise provided in this subsection, be
         conclusive as to Employee's disability. The date of any written opinion
         conclusively finding Employee to be disabled is the date on which the
         disability will be deemed to have occurred. If there is a conclusive
         finding that Employee is not totally disabled, the Company shall have
         the right to request additional disability determinations provided it
         agrees to pay all the expenses of the disability determinations and
         does not request an additional disability determination more frequently
         than once every three months. In connection with any disability
         determination, Employee hereby consents to any required medical
         examination, and agrees to furnish any medical information requested by
         any examining physician and to waive any applicable physician-patient
         privilege that may arise because of such examination. All physicians
         except the First Physician must be board-certified in the specialty
         most closely related to the nature of the disability alleged to exist.

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                                  CONFIDENTIAL

               (iii) by the Company when Employee reaches mandatory retirement
         age under any retirement policy applicable to all executive officers
         adopted by the Company.

               (iv)   by mutual agreement of Employee and the Company.

               (v) by the Company upon the dissolution and liquidation of the
         Company (other than as part of a reorganization, merger, consolidation
         or sale of all or substantially all of the assets of the Company
         whereby the business of the Company is continued).

               (vi) by the Company for just cause at any time upon written
         notice. For purposes of this Agreement, "just cause" shall mean any one
         or more of the following: (A) Employee's material breach of his
         obligations, duties and responsibilities under any term or provision of
         this Agreement, which breach remains uncured for a period of five days
         after written notice by the Company to Employee; (B) Employee's failure
         to adhere to the reasonable standards of performance prescribed by the
         Company; (C) Employee's act of insubordination to the Company's Board
         of Directors; (D) Employee's gross negligence or willful misconduct in
         the performance of his duties under this Agreement; (E) Employee's
         dishonesty, fraud, misappropriation or embezzlement in the course of,
         related to or connected with the business of the Company; (F)
         Employee's conviction of a felony; or (G) Employee's failure (after
         written notice to Employee of such failure and Employee not correcting
         such failure within five days of such notice) to devote his time,
         attention and best efforts to the business of the Company as provided
         in this Agreement.

               (vii)  by either the  Company or  Employee  upon 60 days  written
         notice.

         (c) Any termination of Employee's employment, either by the Company or
Employee, shall be communicated by a written notice of termination to the other
party.

         (d) If Employee's employment is terminated pursuant to the terms of
this Agreement for any reason, Employee shall be entitled to all arrearages of
salary and expenses up to and including the date of termination but shall not be
entitled to further compensation. Provided, that if, at any time after the first
12 months from the date of this Agreement, Employee's employment is terminated
by the Company for any reason other than Employee's death, disability or
retirement, the Company's dissolution or just cause as provided in Paragraphs
13(b)(i), (ii), (iii), (v) or (vi), respectively, Employee shall be entitled to
and the Company shall pay Employee all arrearages of salary and expenses up to
and including the date of termination and, in addition, Employee's monthly base
salary for an additional period of 24 months.

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                                  CONFIDENTIAL

         (e) Upon expiration of the term of this Agreement or upon earlier
termination of this Agreement, Employee shall deliver all Trade Secret
Information of the Company to an authorized representative of the Company, and
the non-disclosure provisions of Paragraph 6 shall survive such expiration or
termination and shall remain in full force and effect for a period of 15 years
from such expiration or termination.

         14. Change of Control.

         (a) In the event of a Change of Control of the Company and (i) during
the one-year period immediately following any Change of Control, the Company
terminates Employee's employment for any reason other than Employee's death,
disability, retirement or just cause as provided in Paragraphs 13(b)(i), (ii),
(iii) and (vi), respectively, (ii) the Employee terminates his employment for
Good Reason, or (iii) during the Window Period the Company or Employee
terminates Employee's employment for any reason, then the Company or its
successor shall pay Employee his full base salary in effect at the time of the
notice of termination through the date of termination, and in lieu of any
further salary payments for periods subsequent to the date of termination, the
Company or its successor shall pay Employee as severance pay an amount equal to
two times Employee's full base salary in effect on the date of termination
payable in 24 equal monthly installments beginning on the first day of the first
calendar month following the date of Employee's termination and continuing on
the first day of each month thereafter until paid.

         (b) Anything in this Agreement to the contrary notwithstanding, if a
Change of Control occurs and if the Employee's employment with the Company is
terminated prior to the date on which the Change of Control occurs, and if it is
reasonably demonstrated by the Employee that such termination of employment (i)
was at the request of a third party who has taken steps reasonably calculated to
effect the Change of Control or (ii) otherwise arose in connection with or
anticipation of the Change of Control, then for all purposes of this Agreement,
the "Change of Control" shall be deemed to have occurred on the date immediately
prior to the date of such termination of employment.

         (c) as used in this Agreement, the terms set forth below shall have the
following respective meanings:

             (i)   "Affiliate" shall have the meaning ascribed to such term in
Rule 12b-2 of the General Rules and Regulations under the Exchange Act, as in
effect on the Agreement Effective Date.

             (ii)  "Agreement Effective Date" shall mean _____________, 2002.

             (iii) "Associate" shall mean, with reference to any Person, (a)
any corporation, firm, partnership, association, unincorporated organization or
other entity (other than the Company or a subsidiary of the Company) of which
such Person is an officer or

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general partner (or officer or general partner of a general partner) or is,
directly or indirectly, the Beneficial Owner of 10% or more of any class of
equity securities, (b) any trust or other estate in which such Person has a
substantial beneficial interest or as to which such Person serves as trustee or
in a similar fiduciary capacity and (c) any relative or spouse of such Person,
or any relative of such spouse, who has the same home as such Person.

             (iv)  "Beneficial  Owner"  shall  mean,  with  reference  to any
securities, any Person if:

               (a) such Person or any of such Person's Affiliates and
         Associates, directly or indirectly, is the "beneficial owner" of (as
         determined pursuant to Rule 13d-3 of the General Rules and Regulations
         under the Exchange Act, as in effect on the Agreement Effective Date)
         such securities or otherwise has the right to vote or dispose of such
         securities, including pursuant to any agreement, arrangement or
         understanding (whether or not in writing); provided, however, that a
         Person shall not be deemed the "Beneficial Owner" of, or to
         "beneficially own," any security under this subsection (a) as a result
         of an agreement, arrangement or understanding to vote such security if
         such agreement, arrangement or understanding: (i) arises solely from a
         revocable proxy or consent given in response to a public (i.e., not
         including a solicitation exempted by Rule 14a-2(b)(2) of the General
         Rules and Regulations under the Exchange Act) proxy or consent
         solicitation made pursuant to, and in accordance with, the applicable
         provisions of the General Rules and Regulations under the Exchange Act
         and (ii) is not then reportable by such Person on Schedule 13D under
         the Exchange Act (or any comparable or successor report);

               (b) such Person or any of such Person's Affiliates and
         Associates, directly or indirectly, has the right or obligation to
         acquire such securities (whether such right or obligation is
         exercisable or effective immediately or only after the passage of time
         or the occurrence of an event) pursuant to any agreement, arrangement
         or understanding (whether or not in writing) or upon the exercise of
         conversion rights, exchange rights, other rights, warrants or options,
         or otherwise; provided, however, that a Person shall not be deemed the
         Beneficial Owner of, or to "beneficially own," (i) securities tendered
         pursuant to a tender or exchange offer made by such Person or any of
         such Person's Affiliates or Associates until such tendered securities
         are accepted for purchase or exchange or (ii) securities issuable upon
         exercise of Exempt Rights; or

               (c) such Person or any of such Person's Affiliates or Associates
         (i) has any agreement, arrangement or understanding (whether or not in
         writing) with any other Person (or any Affiliate or Associate thereof)
         that beneficially owns such securities for the purpose of acquiring,
         holding, voting (except as set forth in the proviso to subsection (a)
         of this definition) or disposing of such securities or (ii) is a member
         of a group (as that term is used in Rule 13d-5(b) of the General Rules
         and

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         Regulations under the Exchange Act) that includes any other Person that
         beneficially owns such securities;

provided, however, that nothing in this definition shall cause a Person engaged
in business as an underwriter of securities to be the Beneficial Owner of, or to
"beneficially own," any securities acquired through such Person's participation
in good faith in a firm commitment underwriting until the expiration of 40 days
after the date of such acquisition. For purposes hereof, "voting" a security
shall include voting, granting a proxy, consenting or making a request or demand
relating to corporate action (including, without limitation, a demand for a
stockholder list, to call a stockholder meeting or to inspect corporate books
and records) or otherwise giving an authorization (within the meaning of Section
14(a) of the Exchange Act) in respect of such security.

         The terms "beneficially own" and "beneficially owning" shall have
meanings that are correlative to this definition of the term "Beneficial Owner."

               (v) "Change of Control" shall mean any of the following
(provided, however, that without limiting the generality of any other provision
hereof, no Change of Control shall be deemed to have occurred as a result of the
consummation of any of the transactions contemplated by the Agreement and Plan
of Merger dated as of March 30, 1998 by and between SLH Corporation, a Kansas
corporation, and the Company (the "Merger Agreement")):

               (a) any Person (other than an Exempt Person) shall become the
         Beneficial Owner of 30% or more of the shares of Common Stock then
         outstanding or 30% or more of the combined voting power of the Voting
         Stock of the Company then outstanding; provided, however, that no
         Change of Control shall be deemed to occur for purposes of this
         subsection (a) if such Person shall become a Beneficial Owner of 30% or
         more of the shares of Common Stock or 30% or more of the combined
         voting power of the Voting Stock of the Company solely as a result of
         (i) an Exempt Transaction or (ii) an acquisition by a Person pursuant
         to a reorganization, merger or consolidation, if, following such
         reorganization, merger or consolidation, the conditions described in
         clauses (i), (ii) and (iii) of subsection (c) of this definition are
         satisfied;

               (b) individuals who, as of the Agreement Effective Date,
         constitute the Board (the "Incumbent Board") cease for any reason to
         constitute at least a majority of the Board; provided, however, that
         any individual becoming a director subsequent to the Agreement
         Effective Date whose election, or nomination for election by the
         Company's shareholders, was approved by a vote of at least a majority
         of the directors then comprising the Incumbent Board shall be
         considered as though such individual were a member of the Incumbent
         Board; provided, further, that there shall be excluded, for this
         purpose, any such individual whose initial assumption of office

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         occurs as a result of any actual or threatened election contest that is
         subject to the provisions of Rule 14a-11 under the Exchange Act;

               (c) approval by the shareholders of the Company of a
         reorganization, merger or consolidation, in each case, unless,
         following such reorganization, merger or consolidation, (i) more than
         80% of the then outstanding shares of common stock of the corporation
         resulting from such reorganization, merger or consolidation and the
         combined voting power of the then outstanding Voting Stock of such
         corporation is then beneficially owned, directly or indirectly, by all
         or substantially all of the Persons who were the Beneficial Owners of
         the outstanding Common Stock immediately prior to such reorganization,
         merger or consolidation in substantially the same proportions as their
         ownership, immediately prior to such reorganization, merger or
         consolidation, of the outstanding Common Stock, (ii) no Person
         (excluding any Exempt Person or any Person beneficially owning,
         immediately prior to such reorganization, merger or consolidation,
         directly or indirectly, 30% or more of the Common Stock then
         outstanding or 30% or more of the combined voting power of the Voting
         Stock of the Company then outstanding) beneficially owns, directly or
         indirectly, 30% or more of the then outstanding shares of common stock
         of the corporation resulting from such reorganization, merger or
         consolidation or the combined voting power of the then outstanding
         Voting Stock of such corporation and (iii) at least a majority of the
         members of the board of directors of the corporation resulting from
         such reorganization, merger or consolidation were members of the
         Incumbent Board at the time of the execution of the initial agreement
         or initial action by the Board providing for such reorganization,
         merger or consolidation; or

               (d) approval by the shareholders of the Company of (i) a complete
         liquidation or dissolution of the Company unless such liquidation or
         dissolution is approved as part of a plan of liquidation and
         dissolution involving a sale or disposition of all or substantially all
         of the assets of the Company to a corporation with respect to which,
         following such sale or other disposition, all of the requirements of
         clauses (ii)(A), (B) and (C) of this subsection (d) are satisfied, or
         (ii) the sale or other disposition of all or substantially all of the
         assets of the Company, other than to a corporation, with respect to
         which, following such sale or other disposition, (A) more than 80% of
         the then outstanding shares of common stock of such corporation and the
         combined voting power of the Voting Stock of such corporation is then
         beneficially owned, directly or indirectly, by all or substantially all
         of the Persons who were the Beneficial Owners of the outstanding Common
         Stock immediately prior to such sale or other disposition in
         substantially the same proportion as their ownership, immediately prior
         to such sale or other disposition, of the outstanding Common Stock, (B)
         no Person (excluding any Exempt Person and any Person beneficially
         owning, immediately prior to such sale or other disposition, directly
         or indirectly, 30% or more of the Common Stock then outstanding or 30%
         or more of the combined voting power of the Voting Stock of the Company
         then outstanding)

                                       12

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

         beneficially owns, directly or indirectly, 30% or more of the then
         outstanding shares of common stock of such corporation and the combined
         voting power of the then outstanding Voting Stock of such corporation
         and (C) at least a majority of the members of the board of directors of
         such corporation were members of the Incumbent Board at the time of the
         execution of the initial agreement or initial action of the Board
         providing for such sale or other disposition of assets of the Company.

               (vi) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.

               (vii) "Exempt Person" shall mean the Company, any subsidiary of
the Company, any employee benefit plan of the Company or any subsidiary of the
Company, and any Person organized, appointed or established by the Company for
or pursuant to the terms of any such plan.

               (viii) "Exempt Rights" shall mean any rights to purchase shares
of Common Stock or other Voting Stock of the Company if at the time of the
issuance thereof such rights are not separable from such Common Stock or other
Voting Stock (i.e., are not transferable otherwise than in connection with a
transfer of the underlying Common Stock or other Voting Stock) except upon the
occurrence of a contingency, whether such rights exist as of the Agreement
Effective Date or are thereafter issued by the Company as a dividend on shares
of Common Stock or other Voting Securities or otherwise.

               (ix) "Exempt Transaction" shall mean an increase in the
percentage of the outstanding shares of Common Stock or the percentage of the
combined voting power of the outstanding Voting Stock of the Company
beneficially owned by any Person solely as a result of a reduction in the number
of shares of Common Stock then outstanding due to the repurchase of Common Stock
or Voting Stock by the Company, unless and until such time as (a) such Person or
any Affiliate or Associate of such Person shall purchase or otherwise become the
Beneficial Owner of additional shares of Common Stock constituting 1% or more of
the then outstanding shares of Common Stock or additional Voting Stock
representing 1% or more of the combined voting power of the then outstanding
Voting Stock, or (b) any other Person (or Persons) who is (or collectively are)
the Beneficial Owner of shares of Common Stock constituting 1% or more of the
then outstanding shares of Common Stock or Voting Stock representing 1% or more
of the combined voting power of the then outstanding Voting Stock shall become
an Affiliate or Associate of such Person.

               (x) "Good Reason" shall mean:

                      (a) the assignment to the Employee of any duties
               materially inconsistent in any respect with the Employee's
               position (including status, offices, titles and reporting
               requirements), authority, duties or responsibilities as
               contemplated by Section 1 of this Agreement, or any other action
               by the

                                       13

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

               Company which results in a diminution in such position,
               authority, duties or responsibilities, excluding for this purpose
               an isolated, insubstantial and inadvertent action not taken in
               bad faith and which is remedied by the Company promptly after
               receipt of notice thereof given by the Employee;

                      (b) any material failure by the Company to comply with any
               of the provisions of this Agreement, other than an isolated,
               insubstantial and inadvertent failure not occurring in bad faith
               and which is remedied by the Company promptly after receipt of
               notice thereof given by the Employee;

                      (c) the Company's requiring the Employee to be based at
               any office outside the Tulsa metropolitan area;

                      (d) any  purported  termination  by the  Company of the
               Employee's  employment  otherwise than as expressly  permitted by
               this Agreement; or

                      [(e) any failure to reelect  Employee as a member of the
               Board of Directors.]

               (xi) "Person" shall mean any individual, firm, corporation,
partnership, association, trust, unincorporated organization or other entity.

               (xii) "Voting Stock" shall mean, with respect to a corporation,
all securities of such corporation of any class or series that are entitled to
vote generally in the election of directors of such corporation (excluding any
class or series that would be entitled so to vote by reason of the occurrence of
any contingency, so long as such contingency has not occurred).

               (xiii) "Window Period" shall mean the 60-day period immediately
following elapse of one year after any Change of Control.

         15. Resignation Upon Termination. In the event of termination of this
Agreement other than for death, Employee agrees to resign from all positions
held in the Company, including without limitation any position as a director,
officer, agent, trustee or consultant of the Company or any affiliate of the
Company.

         16. Notice to Subsequent Employers. For a period of two years after
termination of Employee's employment with the Company for any reason, Employee
will inform any new employer (before accepting employment) of the obligations of
Employee under Paragraphs 6, 7, 8, 9, and 10 of this Agreement.

                                       14

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

         17. Obligations Unconditional. The obligations of the parties under
this Agreement are unconditional and do not depend upon the performance of any
agreements, duties, obligations, or terms outside this Agreement.

         18. Waiver. A party's failure to insist on compliance or enforcement of
any provision of this Agreement shall not affect the validity or enforceability
or constitute a waiver of future enforcement of that provision or of any other
provision of this Agreement by that party or any other party.

         19. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF OKLAHOMA, UNITED STATES OF AMERICA,
WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF. The Company and Employee
expressly and irrevocably consent and submit to the nonexclusive jurisdiction of
any state or federal court sitting in Tulsa County, Oklahoma and agree that, to
the fullest extent allowed by law, such Oklahoma state or federal courts shall
have jurisdiction over any action, suit or proceeding arising out of or relating
to this Agreement. The Company and Employee each irrevocably waive, to the
fullest extent allowed by law, any objection either of them may have to the
laying of venue of any such suit, action or proceeding brought in any state or
federal court sitting in Tulsa County, Oklahoma based upon a claim that such
court is inconvenient or otherwise an objectionable forum. Any process in any
action, suit or proceeding arising out of or relating to this Agreement may,
among other methods, be served upon the Company or Employee by delivering it or
mailing it to their respective addresses set forth herein. Any such delivery or
mail service shall be deemed to have the same force and effect as personal
service in the State of Oklahoma.

         20. Severability. If for any reason any paragraph, term or provision of
this Agreement is held to be invalid or unenforceable for any reason, such
invalidity or unenforceability shall not affect any other provision hereof, and
this Agreement shall be construed and enforced as if such provision had not been
included herein and all other valid provisions herein shall remain in full force
and effect. If for any reason the restrictions and covenants contained herein
are held to cover a geographical area or be for a length of time which is
unreasonable or unenforceable, or in any other way are construed to be too broad
or to any extent invalid, then to the extent the same are or would be valid or
enforceable under applicable law, any court of competent jurisdiction shall
construe and interpret or reform this Agreement to provide for a covenant having
the maximum area, time or other provisions (not greater than those contained
herein) as shall be valid and enforceable under such applicable law.

         21. Jurisdiction. The Company and Employee intend to and hereby
confer jurisdiction to enforce the provisions of this Agreement and any
restrictive covenants contained herein upon the courts of any jurisdiction
within the geographical scope of such covenants. If the courts of any one or
more of such jurisdictions hold the provisions of this

                                       15

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

Agreement or any of the restrictive covenants contained herein unenforceable by
reason of the breadth of such scope or otherwise, it is the intention of the
Company and Employee that such determination not bar or in any way affect the
Company's right to the relief provided herein in the courts of any other
jurisdiction within the geographical scope of such covenants, as to breaches of
such covenants, such covenants as they relate to each jurisdiction being, for
this purpose, severable into diverse and independent covenants.

         22. Notice. Any and all notices required or permitted herein shall be
deemed delivered if delivered personally or if mailed by registered or certified
mail to the Company at its principal place of business and to Employee at the
address hereinafter set forth following Employee's signature, or at such other
address or addresses as either party may hereafter designate in writing to the
other.

         23. Amendments. This Agreement may be amended at any time by mutual
consent of the parties hereto, with any such amendment to be invalid unless in
writing, signed by the Company and Employee.

         24. Burden and Benefit. This Agreement, together with any amendments
hereto, shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors, assigns, heirs and personal
representatives. The Company may, in its sole discretion, assign this Agreement
or its rights hereunder to any parent, affiliate, shareholder, or successor of
the Company, or to any person or entity which purchases substantially all of the
assets of the Company. Employee may not transfer or assign this Agreement or any
of Employee's rights or obligations under this Agreement.

         25. References to Gender and Number Terms. In construing this
Agreement, feminine or number pronouns shall be substituted for those masculine
in form and vice versa, and plural terms shall be substituted for singular and
singular for plural in any place which the context so requires.

         26. Headings. The various headings in this Agreement are inserted for
convenience only and are not part of the Agreement.

         27. Entire Agreement. This Agreement contains the entire
understanding and agreement between the parties relating to the subject matter
hereof.

         28. Counterparts. This Agreement may be executed in one or more
counterparts, and all such counterparts shall constitute one and the same
instrument.

         29. Severance Compensation. In the event of termination of Employee's
employment with the Company under the terms of this Agreement which provide for
payment by the Company to Employee of severance compensation, the amount of such
severance compensation shall in no event be greater than the amount which would
be

                                       16

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                         Syntroleum-Employment Agreement
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                                  CONFIDENTIAL

deductible by the Company under Section 280G of the Internal Revenue Code of
1986, as amended (the "Code"), after taking into consideration all payments to
Employee covered by Code Section 280G which Employee receives or is deemed to
receive (i) under this Agreement; (ii) under the Company's 1993 Stock Option and
Incentive Plan, as amended, by reason of the acceleration of the right to
exercise any options (including any related stock appreciation rights) granted
thereunder or the acceleration of the vesting of any restricted stock awards
granted thereunder; or (iii) under any new plan or arrangement implemented by
the Company after the date of this Agreement which would otherwise be considered
a "parachute payment" under Section 280G. In the event such payments exceed the
amount which would be deductible by the Company under Code Section 280G, the
timing of such payments shall be extended or otherwise modified such that such
payments shall be deductible by the Company under Code Section 280G and in a
manner which, to the extent possible, provides Employee the full benefit of such
payments as originally agreed to.

         IN WITNESS WHEREOF, the Company and Employee have duly executed this
Agreement as of the date and year first above written.

                                       COMPANY:

                                       SYNTROLEUM CORPORATION

                                       By: _____________________________________
                                           Kenneth L. Agee, Chairman/CEO

                                           Syntroleum Corporation.
                                           1350 South Boulder, Suite 1100
                                           Tulsa, Oklahoma  74119

                                       EMPLOYEE:

                                       By: ____________________________________
                                           John B. Holmes, Jr.

                                           Home address:

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

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

                                       17

<PAGE>

                                       August 30, 2002

Mr. John B. Holmes, Jr.
3257 Inwood Drive
Houston, TX  77019

Dear Jack:

At your request, we have reviewed the proposal you faxed to me on August 30,
2002. We are in agreement in principle to the items you have raised, and please
consider this letter an offer to amend both the Offer Of Employment issued to
you dated August 19, 2002, and our proposed Employment Agreement.

Several items have been raised in your term sheet and I would like to address
these.

Stock Options issues:

         1. Syntroleum Corporation (hereafter "the Company") will agree to
include in the stock option grant a provision that one third (1/3) of the stock
options grant will vest immediately upon termination, if such termination occurs
within the first twelve (12) months of employment and is not for just cause.

         2. The Company will agree to include in the stock option grant that, if
termination occurs after the first twelve (12) months of employment but prior to
the first thirty-six (36) months of employment and is not for just cause, any
unvested stock options will vest.

         3. The Directors of The Company agree to submit to the shareholders, a
proposal to amend the 1993 Stock Option and Incentive Plan (As last amended
effective January 22, 2001), to permit the Compensation Committee to issue stock
option grants which are exercisable up to one (1) year following the termination
of the grantee. This submission is however, subject to receipt of an opinion of
counsel that such an amendment will not have a significant negative effect upon
the plan as a whole or a substantial number of other grantees for tax purposes.
There is no guarantee that the shareholders will approve such an amendment.

Severance pay issues:

         The Company will agree that in addition to the events set forth in the
Employment Agreement which would trigger a payment by The Company to you of an
amount equal to twenty-four (24) months base salary will also include the
following:

               a. Termination by the Company for any reason other than just
cause occurring within the first 12 months of employment; or

               b. Your assignment to duties materially inconsistent in any
respect with your position (including status, offices, titles and reporting
requirements), authority, duties or responsibilities as contemplated by Section
1 of the Employment Agreement without your agreement, or any other action by the
Company which results in a diminution in such position, authority, duties or

<PAGE>

responsibilities, excluding for this purpose an isolated, insubstantial and
inadvertent action not taken in bad faith and which is remedied by the Company
promptly after receipt of notice thereof given by the Employee; or

               c. the Company's requiring the Employee to be based at any office
outside the Tulsa Metropolitan area without your agreement;

Miscellaneous issues:

         1. The Company will agree that a determination of the existence of
"just cause" for purposes of termination of employment, within the meaning of
this letter, and paragraph 13 (b) (6) of the Employment Agreement, shall be made
by a majority vote of the Board of Directors.

         2. The Company will agree that the right to cure a material breach, as
set out in paragraph 13 (b) (6) (A) of the Employment Agreement, shall be
amended from five (5) to thirty (30) days.

         3. The Company will agree that any dispute arising under the Employment
Agreement shall be resolved by binding arbitration in Tulsa, Oklahoma pursuant
to the rules then obtaining of the American Arbitration Association.

         4. The Company agrees to grant you four (4) weeks of paid vacation
effective upon your employment date.

If you are in agreement with the modifications and matters proposed in this
letter, please indicate your acceptance on both originals and return one
executed original to me.

                                       Sincerely,

                                       Kenneth L. Agee
                                       Chairman/CEO

Accepted and agreed this 31st day of August, 2002.

-----------------------------
John B. Holmes, Jr.<PAGE>

                                                                    EXHIBIT 10.2

                            INDEMNIFICATION AGREEMENT

         This Indemnification Agreement (this "Agreement"), is made and entered
into as of the 1st day of October, 2002 by and between Syntroleum Corporation, a
Delaware corporation (the "Corporation"), and John B. Holmes, Jr.
("Indemnitee").

                              W I T N E S S E T H:

         WHEREAS, Indemnitee is currently serving or is about to begin serving
as a director and/or officer of the Corporation and/or in another Corporate
Status, and Indemnitee is willing, subject to, among other things, the
Corporation's execution and performance of this Agreement, to continue in or
assume such capacity or capacities; and

         WHEREAS, the Bylaws of the Corporation provide that the Corporation
shall indemnify directors and officers of the Corporation in the manner set
forth therein; and

         WHEREAS, the Corporation and Indemnitee desire to enter into this
Agreement to induce Indemnitee to provide services as contemplated hereby and
the Corporation has deemed it to be in its best interest to enter into this
Agreement with Indemnitee.

         NOW, THEREFORE, in consideration of Indemnitee's agreement to provide
services to the Corporation and/or certain of its affiliates as contemplated by
this Agreement, the mutual agreements contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows.

                             1. Certain Definitions

         As used herein, the following words and terms shall have the following
respective meanings (whether singular or plural):

         "Change of Control" means a change in control of the Corporation after
the date Indemnitee acquired his Corporate Status, which shall be deemed to have
occurred in any one of the following circumstances occurring after such date:
(i) there shall have occurred an event required to be reported with respect to
the Corporation in response to Item 6(e) of Schedule 14A of Regulation 14A (or
in response to any similar item or any similar schedule or form) promulgated
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
whether or not the Corporation is then subject to such reporting requirement;
(ii) any "person" (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act) shall have become the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of the
Corporation representing 40% or more of the combined voting power of the
Corporation's then outstanding voting securities without prior approval of at
least two-thirds of

<PAGE>

            Syntroleum Amended and Restated Indemnification Agreement
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                                  CONFIDENTIAL

the members of the Board of Directors in office immediately prior to such person
attaining such percentage interest; (iii) the Corporation is a party to a
merger, consolidation, sale of assets or other reorganization, or a proxy
contest, as a consequence of which members of the Board of Directors in office
immediately prior to such transaction or event constitute less than a majority
of the Board of Directors thereafter; or (iv) during any period of two
consecutive years, individuals who at the beginning of such period constituted
the Board of Directors (including, for this purpose, any new director whose
election or nomination for election by the Corporation's shareholders was
approved by a vote of at least two-thirds of the directors then still in office
who were directors at the beginning of such period) cease for any reason to
constitute at least a majority of the Board of Directors.

         "Corporate Status" describes the status of Indemnitee as a director,
officer, employee, agent or fiduciary of the Corporation or of any other
corporation, partnership, limited liability company, association, joint venture,
trust, employee benefit plan or other enterprise that Indemnitee is or was
serving at the request of the Corporation.

         "Court" means the District Court of Tulsa County of the State of
Oklahoma or any other court of competent jurisdiction.

         "DGCL" means the Delaware General Corporation Law, as amended from time
to time.

         "Expenses" shall include all reasonable attorneys' fees, retainers,
court costs, transcript costs, fees of experts, witness fees, travel expenses,
duplicating costs, printing and binding costs, telephone charges, postage,
delivery service fees, and all other disbursements or expenses of the types
customarily incurred in connection with prosecuting, defending, preparing to
prosecute or defend, investigating, or being or preparing to be a witness in a
Proceeding.

         "Independent Counsel" means a law firm, or a member of a law firm, that
is experienced in matters of corporation law and neither presently is, nor in
the five years previous to his selection or appointment has been, retained to
represent: (i) the Corporation or Indemnitee in any matter material to either
such party or (ii) any other party to the Proceeding giving rise to a claim for
indemnification hereunder.

         "Matter" is a claim, a material issue or a substantial request for
relief.

         "Proceeding" includes any action, suit, arbitration, alternate dispute
resolution mechanism, investigation, administrative hearing or any other
proceeding, whether civil, criminal, administrative or investigative, except one
initiated by Indemnitee pursuant to Section 6.01 of this Agreement to enforce
his rights under this Agreement.

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            Syntroleum Amended and Restated Indemnification Agreement
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                                  CONFIDENTIAL

                            2. Services by Indemnitee

2.01     Services by Indemnitee. Indemnitee agrees to serve or continue to serve
         in his current capacity or capacities as a director, officer, employee,
         agent or fiduciary of the Corporation. Indemnitee also agrees to serve,
         as the Corporation may request from time to time, as a director,
         officer, employee, agent or fiduciary of any other corporation,
         partnership, limited liability company, association, joint venture,
         trust or other enterprise in which the Corporation has an interest.
         Indemnitee and the Corporation each acknowledge that they have entered
         into this Agreement as a means of inducing Indemnitee to serve the
         Corporation in such capacities.

2.02     Termination of Services. Indemnitee may at any time and for any reason
         resign from such position or positions (subject to any other
         contractual obligation or any obligation imposed by operation of law).
         The Corporation shall have no obligation under this Agreement to
         continue Indemnitee in any such position for any period of time and
         shall not be precluded by the provisions of this Agreement from
         removing or terminating Indemnitee from any such position at any time.

                               3. Indemnification

3.01     General. The Corporation shall, to the fullest extent permitted by
         applicable law in effect on the date hereof, and to such greater extent
         as applicable law may thereafter permit, indemnify and hold Indemnitee
         harmless from and against any and all losses, liabilities, claims,
         damages and, subject to Section 3.02, Expenses (as this and all other
         capitalized words are defined in Article 1. of this Agreement),
         whatsoever arising out of any event or occurrence related to the fact
         that Indemnitee is or was a director or officer of the Corporation or
         is or was serving in another Corporate Status.

3.02     Expenses. If Indemnitee is, by reason of his Corporate Status, a party
         to and is successful, on the merits or otherwise, in any Proceeding, he
         shall be indemnified against all Expenses actually and reasonably
         incurred by him or on his behalf in connection therewith. If Indemnitee
         is not wholly successful in such Proceeding but is successful, on the
         merits or otherwise, as to any Matter in such Proceeding, the
         Corporation shall indemnify Indemnitee against all Expenses actually
         and reasonably incurred by him or on his behalf relating to such
         Matter. The termination of any Matter in such a Proceeding by
         dismissal, with or without prejudice, shall be deemed to be a
         successful result as to such Matter. To the extent that the Indemnitee
         is, by reason of his Corporate Status, a witness in any Proceeding, he
         shall be indemnified against all Expenses actually and reasonably
         incurred by him or on his behalf in connection therewith.

                                        3

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            Syntroleum Amended and Restated Indemnification Agreement
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                                  CONFIDENTIAL

                           4. Advancement of Expenses

4.01     Advances. In the event of any threatened or pending action, suit or
         proceeding in which Indemnitee is a party or is involved and that may
         give rise to a right of indemnification under this Agreement, following
         written request to the Corporation by Indemnitee, the Corporation shall
         promptly pay to Indemnitee amounts to cover expenses reasonably
         incurred by Indemnitee in such proceeding in advance of its final
         disposition upon the receipt by the Corporation of (i) a written
         undertaking executed by or on behalf of Indemnitee providing that
         Indemnitee will repay the advance if it shall ultimately be determined
         that Indemnitee is not entitled to be indemnified by the Corporation as
         provided in this Agreement and (ii) satisfactory evidence as to the
         amount of such expenses.

4.02     Repayment of Advances or Other Expenses. Indemnitee agrees that
         Indemnitee shall reimburse the Corporation for all expenses paid by the
         Corporation in defending any civil, criminal, administrative or
         investigative action, suit or proceeding against Indemnitee in the
         event and only to the extent that it shall be determined pursuant to
         the provisions of this Agreement or by final judgment or other final
         adjudication under the provisions of any applicable law that Indemnitee
         is not entitled to be indemnified by the Corporation for such expenses.

        5. Procedure for Determination of Entitlement to Indemnification

5.01     Request for Indemnification. To obtain indemnification, Indemnitee
         shall submit to the Secretary of the Corporation a written claim or
         request. Such written claim or request shall contain sufficient
         information to reasonably inform the Corporation about the nature and
         extent of the indemnification or advance sought by Indemnitee. The
         Secretary of the Corporation shall promptly advise the Board of
         Directors of such request.

5.02     Determination of Entitlement; No Change of Control. If there has been
         no Change of Control at the time the request for indemnification is
         submitted, Indemnitee's entitlement to indemnification shall be
         determined in accordance with Section 145(d) of the DGCL. If
         entitlement to indemnification is to be determined by Independent
         Counsel, the Corporation shall furnish notice to Indemnitee within 10
         days after receipt of the request for indemnification, specifying the
         identity and address of Independent Counsel. The Indemnitee may, within
         14 days after receipt of such written notice of selection, deliver to
         the Corporation a written objection to such selection. Such objection
         may be asserted only on the ground that the Independent Counsel so
         selected does not meet the requirements of Independent Counsel and the
         objection shall set forth with particularity the factual basis for such
         assertion. If there is an objection to the selection of Independent
         Counsel, either the Corporation or Indemnitee may petition the Court
         for a determination that the objection is without a reasonable basis
         and/or for the appointment of Independent Counsel selected by the
         Court.

                                       4

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            Syntroleum Amended and Restated Indemnification Agreement
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                                  CONFIDENTIAL

5.03     Determination of Entitlement; Change of Control. If there has been a
         Change of Control at the time the request for indemnification is
         submitted, Indemnitee's entitlement to indemnification shall be
         determined in a written opinion by Independent Counsel selected by
         Indemnitee. Indemnitee shall give the Corporation written notice
         advising of the identity and address of the Independent Counsel so
         selected. The Corporation may, within seven days after receipt of such
         written notice of selection, deliver to the Indemnitee a written
         objection to such selection. Indemnitee may, within five days after the
         receipt of such objection from the Corporation, submit the name of
         another Independent Counsel and the Corporation may, within seven days
         after receipt of such written notice of selection, deliver to the
         Indemnitee a written objection to such selection. Any objections
         referred to in this Section 5.03 may be asserted only on the ground
         that the Independent Counsel so selected does not meet the requirements
         of Independent Counsel and such objection shall set forth with
         particularity the factual basis for such assertion. Indemnitee may
         petition the Court for a determination that the Corporation's objection
         to the first and/or second selection of Independent Counsel is without
         a reasonable basis and/or for the appointment as Independent Counsel of
         a person selected by the Court.

5.04     Procedures of Independent Counsel. If a Change of Control shall have
         occurred before the request for indemnification is sent by Indemnitee,
         Indemnitee shall be presumed (except as otherwise expressly provided in
         this Agreement) to be entitled to indemnification upon submission of a
         request for indemnification in accordance with Section 5.01 of this
         Agreement, and thereafter the Corporation shall have the burden of
         proof to overcome the presumption in reaching a determination contrary
         to the presumption. The presumption shall be used by Independent
         Counsel as a basis for a determination of entitlement to
         indemnification unless the Corporation provides information sufficient
         to overcome such presumption by clear and convincing evidence or the
         investigation, review and analysis of Independent Counsel convinces him
         by clear and convincing evidence that the presumption should not apply.

         Except in the event that the determination of entitlement to
         indemnification is to be made by Independent Counsel, if the person or
         persons empowered under Section 5.02 or 5.03 of this Agreement to
         determine entitlement to indemnification shall not have made and
         furnished to Indemnitee in writing a determination within 60 days after
         receipt by the Corporation of the request therefor, the requisite
         determination of entitlement to indemnification shall be deemed to have
         been made and Indemnitee shall be entitled to such indemnification
         unless Indemnitee knowingly misrepresented a material fact in
         connection with the request for indemnification or such indemnification
         is prohibited by applicable law. The termination of any Proceeding or
         of any Matter therein, by judgment, order, settlement or conviction, or
         upon a plea of nolo contendere or its equivalent, shall not (except as
         otherwise expressly provided in this Agreement) of itself adversely
         affect the right of Indemnitee to indemnification or create a
         presumption that Indemnitee did not act in good faith and in a manner
         that he reasonably believed to be in or not opposed to

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         the best interests of the Corporation, or with respect to any criminal
         Proceeding, that Indemnitee had reasonable cause to believe that his
         conduct was unlawful. A person who acted in good faith and in a manner
         he reasonably believed to be in the interest of the participants and
         beneficiaries of an employee benefit plan of the Corporation shall be
         deemed to have acted in a manner not opposed to the best interests of
         the Corporation.

         For purposes of any determination hereunder, a person 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 Corporation, or, with
         respect to any criminal action or Proceeding, to have had no reasonable
         cause to believe his conduct was unlawful, if his action is based on
         the records or books of account of the Corporation or another
         enterprise or on information supplied to him by the officers of the
         Corporation or another enterprise in the course of their duties or on
         the advice of legal counsel for the Corporation or another enterprise
         or on information or records given or reports made to the Corporation
         or another enterprise by an independent certified public accountant or
         by an appraiser or other expert selected with reasonable care by the
         Corporation or another enterprise. The term "another enterprise" as
         used in this Section shall mean any other corporation or any
         partnership, limited liability company, association, joint venture,
         trust, employee benefit plan or other enterprise of which such person
         is or was serving at the request of the Corporation as a director,
         officer, employee or agent. The provisions of this paragraph shall not
         be deemed to be exclusive or to limit in any way the circumstances in
         which an Indemnitee may be deemed to have met the applicable standards
         of conduct for determining entitlement to rights under this Agreement.

5.05     Independent Counsel Expenses. The Corporation shall pay any and all
         reasonable fees and expenses of Independent Counsel incurred acting
         pursuant to this Article 5. and in any proceeding to which it is a
         party or witness in respect of its investigation and written report and
         shall pay all reasonable fees and expenses incident to the procedures
         in which such Independent Counsel was selected or appointed. No
         Independent Counsel may serve if a timely objection has been made to
         his selection until a Court has determined that such objection is
         without a reasonable basis.

                        6. Certain Remedies of Indemnitee

6.01     Adjudication. In the event that (i) a determination is made pursuant to
         Section 5.02 or 5.03 hereof that Indemnitee is not entitled to
         indemnification under this Agreement; (ii) advancement of Expenses is
         not timely made pursuant to Section 4.01 of this Agreement; (iii)
         Independent Counsel has not made and delivered a written opinion
         determining the request for indemnification (a) within 90 days after
         being appointed by the Court, or (b) within 90 days after objections to
         his selection have been overruled by the Court or (c) within 90 days
         after the time for the Corporation or Indemnitee to object to his
         selection; or (iv) payment of indemnification is not made within five
         days after a determination of entitlement to indemnification has been
         made or deemed to have been

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         made pursuant to Section 5.02, 5.03 or 5.04 of this Agreement,
         Indemnitee shall be entitled to an adjudication in the Court, or in any
         other court of competent jurisdiction, of his entitlement to such
         indemnification or advancement of Expenses. In the event that a
         determination shall have been made that Indemnitee is not entitled to
         indemnification, any judicial proceeding or arbitration commenced
         pursuant to this Section 6.01 shall be conducted in all respects as a
         de novo trial on the merits and Indemnitee shall not be prejudiced by
         reason of that adverse determination. If a Change of Control shall have
         occurred, in any judicial proceeding commenced pursuant to this Section
         6.01, the Corporation shall have the burden of proving that Indemnitee
         is not entitled to indemnification or advancement of Expenses, as the
         case may be. If a determination shall have been made or deemed to have
         been made that Indemnitee is entitled to indemnification, the
         Corporation shall be bound by such determination in any judicial
         proceeding commenced pursuant to this Section 6.01, or otherwise,
         unless Indemnitee knowingly misrepresented a material fact in
         connection with the request for indemnification, or such
         indemnification is prohibited by law.

         The Corporation shall be precluded from asserting in any judicial
         proceeding commenced pursuant to this Section 6.01 that the procedures
         and presumptions of this Agreement are not valid, binding and
         enforceable, and shall stipulate in any such proceeding that the
         Corporation is bound by all provisions of this Agreement. In the event
         that Indemnitee, pursuant to this Section 6.01, seeks a judicial
         adjudication to enforce his rights under, or to recover damages for
         breach of, this Agreement, Indemnitee shall be entitled to recover from
         the Corporation, and shall be indemnified by the Corporation against,
         any and all Expenses actually and reasonably incurred by him in such
         judicial adjudication, but only if he prevails therein. If it shall be
         determined in such judicial adjudication that Indemnitee is entitled to
         receive part but not all of the indemnification or advancement of
         Expenses sought, the Expenses incurred by Indemnitee in connection with
         such judicial adjudication or arbitration shall be appropriately
         prorated.

                       7. Participation by the Corporation

7.01     Participation by the Corporation. With respect to any such claim,
         action, suit, proceeding or investigation as to which Indemnitee
         notifies the Corporation of the commencement thereof: (a) the
         Corporation will be entitled to participate therein at its own expense;
         (b) except as otherwise provided below, to the extent that it may wish,
         the Corporation (jointly with any other indemnifying party similarly
         notified) will be entitled to assume the defense thereof, with counsel
         reasonably satisfactory to Indemnitee. After receipt of notice from the
         Corporation to Indemnitee of the Corporation's election so to assume
         the defense thereof, the Corporation will not be liable to Indemnitee
         under this Agreement for any legal or other expenses subsequently
         incurred by Indemnitee in connection with the defense thereof other
         than reasonable costs of investigation or as otherwise provided below.
         Indemnitee shall have the right to employ his own counsel in such
         action, suit, proceeding or investigation but the fees and expenses of
         such counsel

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         incurred after notice from the Corporation of its assumption of the
         defense thereof shall be at the expense of Indemnitee unless (i) the
         employment of counsel by Indemnitee has been authorized by the
         Corporation, (ii) Indemnitee shall have reasonably concluded that there
         is a conflict of interest between the Corporation and Indemnitee in the
         conduct of the defense of such action or (iii) the Corporation shall
         not in fact have employed counsel to assume the defense of such action,
         in each of which cases the fees and expenses of counsel employed by
         Indemnitee shall be subject to indemnification pursuant to the terms of
         this Agreement (the Corporation shall not be entitled to assume the
         defense of any action, suit, proceeding or investigation brought in the
         name of or on behalf of the Corporation or as to which Indemnitee shall
         have made the conclusion provided for in (ii) above); and (c) the
         Corporation shall not be liable to indemnify Indemnitee under this
         Agreement for any amounts paid in settlement of any action or claim
         effected without its written consent, which consent shall not be
         unreasonably withheld. The Corporation shall not settle any action or
         claim in any manner that would impose any limitation or unindemnified
         penalty on Indemnitee without Indemnitee's written consent, which
         consent shall not be unreasonably withheld.

                                8. Miscellaneous

8.01     Nonexclusivity of Rights. The rights of indemnification and advancement
         of Expenses as provided by this Agreement shall not be deemed exclusive
         of any other rights to which Indemnitee may at any time be entitled to
         under applicable law, the Corporation's Certificate of Incorporation,
         the Corporation's Bylaws, any agreement, a vote of shareholders or a
         resolution of directors, or otherwise. No amendment, alteration or
         repeal of this Agreement or any provision hereof shall be effective as
         to Indemnitee for acts, events and circumstances that occurred, in
         whole or in part, before such amendment, alteration or repeal. The
         provisions of this Agreement shall continue as to Indemnitee whose
         Corporate Status has ceased for any reason and shall inure to the
         benefit of his heirs, executors and administrators.

8.02     Insurance and Subrogation. The Corporation shall not be liable under
         this Agreement to make any payment of amounts otherwise indemnifiable
         hereunder if, but only to the extent that, Indemnitee has otherwise
         actually received such payment under any insurance policy, contract,
         agreement or otherwise. In the event of any payment hereunder, the
         Corporation shall be subrogated to the extent of such payment to all
         the rights of recovery of Indemnitee, who shall execute all papers
         required and take all action reasonably requested by the Corporation to
         secure such rights, including execution of such documents as are
         necessary to enable the Corporation to bring suit to enforce such
         rights.

8.03     Acknowledgment of Certain Matters. Both the Corporation and Indemnitee
         acknowledge that in certain instances, applicable law or public policy
         may prohibit indemnification of Indemnitee by the Corporation under
         this Agreement or otherwise. Indemnitee understands and acknowledges
         that the Corporation has undertaken or may be

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         required in the future to undertake, by the Securities and Exchange
         Commission, to submit the question of indemnification to a court in
         certain circumstances for a determination of the Corporation's right
         under public policy to indemnify Indemnitee.

8.04     Amendment. This Agreement may not be modified or amended except by a
         written instrument executed by or on behalf of each of the parties
         hereto.

8.05     Waivers. The observance of any term of this Agreement may be waived
         (either generally or in a particular instance and either retroactively
         or prospectively) by the party entitled to enforce such term only by a
         writing signed by the party against which such waiver is to be
         asserted. Unless otherwise expressly provided herein, no delay on the
         part of any party hereto in exercising any right, power or privilege
         hereunder shall operate as a waiver thereof, nor shall any waiver on
         the part of any party hereto of any right, power or privilege hereunder
         operate as a waiver of any other right, power or privilege hereunder
         nor shall any single or partial exercise of any right, power or
         privilege hereunder preclude any other or further exercise thereof or
         the exercise of any other right, power or privilege hereunder.

8.06     Entire Agreement. This Agreement and the documents referred to herein
         constitute the entire agreement between the parties hereto with respect
         to the matters covered hereby, and any other prior or contemporaneous
         oral or written understandings or agreements with respect to the
         matters covered hereby are superseded by this Agreement.

8.07     Severability. If any provision or provisions of this Agreement shall be
         held to be invalid, illegal or unenforceable for any reason whatsoever,
         the validity, legality and enforceability of the remaining provisions
         shall not in any way be affected or impaired thereby; and, to the
         fullest extent possible, the provisions of this Agreement shall be
         construed so as to give effect to the intent manifested by the
         provision held invalid, illegal or unenforceable.

8.08     Certain Actions For Which Indemnification Is Not Provided.
         Notwithstanding any other provision of this Agreement, Indemnitee shall
         not be entitled to indemnification or advancement of Expenses under
         this Agreement with respect to any Proceeding, or any Matter therein,
         brought or made by Indemnitee against the Corporation.

8.09     Notices. Promptly after receipt by Indemnitee of notice of the
         commencement of any action, suit or proceeding, Indemnitee shall, if he
         anticipates or contemplates making a claim for expenses or an advance
         pursuant to the terms of this Agreement, notify the Corporation of the
         commencement of such action, suit or proceeding; provided, however,
         that any delay in so notifying the Corporation shall not constitute a
         waiver or release by Indemnitee of rights hereunder and that any
         omission by Indemnitee to so notify the Corporation shall not relieve
         the Corporation from any liability that it may have to Indemnitee
         otherwise than under this Agreement. Any communication required or
         permitted to the Corporation shall be addressed to the Secretary of the
         Corporation and

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                                  CONFIDENTIAL

         any such communication to Indemnitee shall be addressed to the
         Indemnitee's address as shown on the Corporation's records unless the
         Indemnitee specifies otherwise and shall be personally delivered or
         delivered by overnight mail delivery. Any such notice shall be
         effective upon receipt.

8.10     Governing Law. This Agreement shall be construed in accordance with and
         governed by the laws of the State of Delaware without regard to any
         principles of conflict of laws that, if applied, might permit or
         require the application of the laws of a different jurisdiction.

8.11     Headings. The Article and Section headings in this Agreement are for
         convenience of reference only, and shall not be deemed to alter or
         affect the meaning or interpretation of any provisions hereof.

8.12     Counterparts. This Agreement may be executed in counterparts, each of
         which shall be deemed to be an original and all of which together shall
         be deemed to be one and the same instrument.

8.13     Use of Certain Terms. As used in this Agreement, the words "herein,"
         "hereof," and "hereunder" and other words of similar import refer to
         this Agreement as a whole and not to any particular paragraph,
         subparagraph, section, subsection, or other subdivision. Whenever the
         context may require, any pronoun used in this Agreement shall include
         the corresponding masculine, feminine or neuter forms, and the singular
         form of nouns, pronouns and verbs shall include the plural and vice
         versa.

         IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
to be effective as of the date first above written.

                                       SYNTROLEUM CORPORATION

                                       By: _____________________________________
                                           Kenneth L. Agee
                                           Chairman/Chief Executive Officer

                                       INDEMNITEE

                                       By: _____________________________________
                                           John B. Homes, Jr.
                                           President/Chief Operating Officer

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