Document:

<PAGE>

                                                                 Exhibit 10.16.2

                                                                   4/97 REVISION

                       THIRD AMENDMENT TO LEASE AGREEMENT

           THIS AGREEMENT ("Agreement") is made as of the February 19, 2002
                                                          ----------------------

between Lord Baltimore Capital Corporation (hereinafter referred to as
        ----------------------------------
"Landlord") and Kaiser Ventures. LLC p/k/a Kaiser Ventures Inc. (hereinafter
                ----------------------------------------------
referred to as "Tenant").

                                   WLTNESSETH:

         WHEREAS, Landlord and Tenant entered into a lease dated June 6. 1994
                                                                 ------------
(the "Lease Agreement") for approximately seven thousand five hundred eighty
                                          ----------------------------------
(7,580) rentable square feet (the "Demised Premises") known as suite 850 on the
 -----                                                               ---
eight (8th) floor of the building commonly known as Empire Towers I located at
----------                                          ---------------
3633 Inland Empire Blvd., Ontario, CA 91764 (the "Building"); and
--------------------------------------------

         WHEREAS, by First Amendment to Lease ("First Amendment") dated May 18,
                                                                        ------
1999 Landlord and Tenant amended the Lease Agreement to, among other things,
----
accomplish the following:

(i) reduce the Demised Premises
    -------------------------------------------------------------------
(ii) extend the Term by three (3) years and six (6) days
    -------------------------------------------------------------------
and (iii) renovate the Demised Premises
                                       --------------------------------
(the Lease Agreement, as amended, is sometimes collectively referred to as the
"Lease Agreement"); and

           WHEREAS, by Second Amendment to Lease Agreement ("Second Amendment")
dated September 27. 1999, Landlord and Tenant amended the Lease Agreement, as
      ------------------
previously amended by the First Amendment to, among other things, accomplish the
following:

(i) expand the Demised Premises by ninety one (91) rentable square feet
   ------------------------------------------------------------------------
(the Lease Agreement, as amended, is sometimes collectively referred to as
the "Lease Agreement"); and

                   [See Additional Recitals Attached: Yes [_] No [X]

          WHEREAS, Landlord and Tenant, by this Third Amendment to Lease
                                                -----
Agreement, desire to, among other things, accomplish the following:
(i) relocate and reduce the Demised Premises
   ------------------------------------------------------------------------
(ii) extend the Term by sixty (60) months
    -----------------------------------------------------------------------
and (iii) provide an option to terminate on the forty third (43rd) month
         ----------------------------------------------------------------------

          NOW THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties agree as follows:

      1.  Incorporation of Recitals. All of the recitals set forth above in the
          -------------------------
"WHEREAS" Clauses are hereby made an integral part of this Agreement.

                                  Page 1 of 11

<PAGE>

      2  Effective Date. Unless otherwise expressly set forth herein, the
         --------------
effective date (the "Effective Date") of the amendments set forth herein shall
be the earlier of (a) May 15, 2002 or (b) the date when Landlord shall have
substantially completed all work to be performed by it pursuant to this
Agreement. If Landlord is unable to substantially complete the work to be
performed by it pursuant to this Agreement on or before May 15, 2002, because a
contingency herein has not been satisfied, or for any reason beyond Landlord's
reasonable control, Landlord shall have no liability to Tenant for damages and
the Effective Date shall be deferred until the date on which Landlord is able to
substantially complete the work. Landlord shall be deemed to have substantially
completed all work to be performed by it even though there may remain to be done
punch list items which will not materially interfere with Tenant's use of the
subject space. Notwithstanding the foregoing, the Effective Date shall not be
deferred beyond the date on which Landlord would have been able to substantially
complete such work but for: (a)changes made by Tenant in the work to be
performed by Landlord; or (b)any breach or failure of Tenant to fully perform
its obligations under the Lease Agreement as amended. Immediately after the
Effective Date has been determined, the Effective Date shall be confirmed by
Landlord and Tenant in writing.

                            (INTENTIONALLY LEFT WORK)

                                  Page 2 of 11

<PAGE>

     3.    Extention. The term of the Lease Agreement is hereby extended for a
           ---------
period of sixty (60) month ("Second Extended Term") commencing on September 1,
2002

                           (INTENTIONALLY LEFT BLANK)

                                  Page 3 of 11

<PAGE>

     4.    Tenant's Percentage. As of the Effective Date, Section(s) 7.03 and
           -------------------
7.06 (Taxes and Operating Costs Escalation) of the Lease Agreement shall be
amended by increasing/decreasing the percentage set forth therein from "three
and 1180/10000 percent( 3.1180 %)" to one and 7621/10000 percent ( 1.7621 %)"

                           (INTENTIONALLY LEFT BLANK)

                                  Page 4 of 11

<PAGE>

                                                            KAISER REVISION 2/02

           5.  Chance of Base Year. As of September 1, 2002 the following base
               -------------------
years referenced in the Lease Agreement shall be amended as follows:

     A.  "Base Year for Taxes shall mean calendar year two thousand two
         --------------------
          (2002)."

     B.  "Base Year for Operating Costs shall mean calendar year two thousand
         ------------------------------
         two (2002)."

                         (INTENTIONALLY LEFT BLANK)

                                  Page 5 of 11

<PAGE>
                                                                   4/97 REVISION

         6 .  Relocation.
              ----------

                  (A) Relocation. Tenant currently leases from Landlord
                      ----------
approximately five thousand five hundred thirty five( 5,535 ) rentable square
feet of space located at on the eighth floor of the Building (the "Original
Space"). As of the Effective Date Tenant shall be relocated from the Original
Space to approximately three thousand one hundred twenty eight ( 3.128 )
rentable square feet of space located at on the fourth floor of the Building
(the "New Space"). As of the Effective Date, all references m the Lease
Agreement (or any amendment thereto) to the Demised Premises shall refer to the
New Space. Tenant agrees to pay the expenses reasonably incurred by Tenant
incidental to such relocation, including but not limited to, moving expenses,
and expenses in connection with change of telephone and stationery.

                  (B) Early Entry. In the event Landlord permits Tenant to enter
                      -----------
upon the New Space prior to the Effective Date (or if Tenant enters the New
Space without Landlord's consent) for the purpose of moving or installing any of
Tenant's furniture, equipment, fixtures, business machines or other personal
property into or upon the New Space or for any other reason, the provisions of
the Lease Agreement (excluding those related to rent or additional rent) shall
become effective with respect to the New Space as of the date of the first such
entry by Tenant.

                (C)   Floor Plan. As of the Effective Date, the floor plan(s),
                      ----------
showing the locations of (i) the Original Space and (ii) the New Space, attached
hereto as Exhibit "A- 3 ," and by this reference made a part hereof; shall
replace Exhibit "A-2" to the Lease Agreement.

                (D)   Surrender. On or before the Effective Date, Tenant shall
                      ---------
remove all of its personal property from the Original Space and surrender same
to Landlord, broom clean and in accordance with all relevant provisions of the
Lease Agreement. Tenant covenants, represents and warrants to Landlord that
nothing has been or will be done or suffered by it whereby the Original Space,
or any part thereof; or any alterations, installations, additions and/or
improvements in and to such space, or any part thereof; have been or will be
encumbered in any way whatsoever, and that Tenant has and will have good right
to surrender the same, and that no one other than Tenant has acquired or will
acquire through or under Tenant any right, title or interest in or to such
space, or any part thereof; or in or to said alterations, installations,
additions and/or improvements, or any part thereof Tenant acknowledges that it
shall remain liable to Landlord for any past due Rent or other obligations due
with respect to the Original Space up to the Effective Date hereof and that all
indemnifications of the Lease Agreement survive the relocation and other
amendments set forth herein.

                (E)   Effect of Relocation. Landlord and Tenant acknowledge,
                      --------------------
consent and agree that the New Space contains approximately two thousand four
hundred seven (2,407) rentable square feet (less) than the Original Space and
that as of the Effective Date, the New Space shall be deemed to contain three
thousand one hundred twenty eight (3,128) rentable square feet.

                                  Page 6 of 11

<PAGE>

                                                            KAISER REVISION 2/02

       7.   Base Rent.  AS of the Effective Date, the Base Rent payable for the
            ---------
Demised Premises shall be as follows:

                                  Annual Rent          Period         Monthly
            Lease Period          Per Sq. Foot          Rent         Base Rent

      Effective Date - 8/31/02    $     N/A         $ unknown      $  10,793.25

           9/1/02-2/28/03         $      23.40      $  36,597.60   $   6,099.60

           3/1/03-2/28/04         $      24.00      $  75,072.00   $   6,256.00

           3/1/04-2/28/05         $      24.72      $  77,324.16   $   6,443.68

           3/1/05-2/28/06         $      25.46      $  79,638.84   $   6,636.57

           3/1/06-2/28/07         $      26.22      $  82,016.16   $   6,834.68

           3/1/07-8/31/07         $      27.01      $  42,243.66   $   7,040.61

                                                    Total Base
                                                    Rent

                                                    $    unknown

       Said Base Rent ("Base Rent") shall be payable without demand in monthly
installments ("Monthly Base Rent") in advance on the first day of each calendar
month. For purposes of applying the rent schedule set forth above, if the
Effective Date occurs on a day other than the first day of a calendar month,
then the Monthly Base Rent for the month during which the Effective Date occurs
and for each month during which a Monthly Base Rent change occurs, if any, shall
be prorated on the basis of the actual number of days in said month. In the
event that the term hereof expires on a day other than the last day of a
calendar month, then the Monthly Base Rent for the month during which said
expiration occurs shall be prorated on the basis of the actual number of days in
said month.

       Notwithstanding the foregoing, in the event (i) Landlord is successful in
leasing the Original Space (Suite #850) to a third party tenant prior to August
31, 2002 and (ii) If such third party tenant begins and continues to pay Base
Rent and additional Rent (in a total amount no less than $12,071.33 per month)
to Landlord through August 31, 2002 ("New Tenant's Rent"), then Landlord will
reduce Tenant's Base Rent from $10,793.25 per month to $6,099.60 per month (The
"Credit") each month Landlord receives the New Tenant's Rent until August 31,
2002. Commencing September 1, 2002 the Base Rent schedule set forth above shall
prevail and have priority and Tenant shall no longer be entitled to the Credit.
Landlord shall not be obligated to lease the Original Space (i) until it obtains
full and complete possession of same from Tenant (ii) when other premises in the
Building (Or other buildings in the Project) suitable for such prospective
tenants are, or soon will be available (iii) for a rental less than Landlord's
current market rental then prevailing in the Project or (iv) if the offer to
lease the Original Space by any prospect is not acceptable to Landlord, in
Landlord s sole discretion. Landlord will market the Original Space in
accordance with its current practices for vacant space in the Building.

                                  Page 7 of 11

<PAGE>

                                                                   4/97 REVISION

        8. Tenant Improvements. (Turnkey)
           -------------------

           (A) Landlord shall prepare or renovate the New Space for Tenant's
occupancy in accordance with the work letter attached hereto as Exhibit "B" and,
if applicable, the space plan attached hereto as Exhibit "B-1."

           (B) Except as may be otherwise approved by Landlord in writing, all
work to prepare the New Space for Tenant's occupancy shall be performed by
Landlord's contractors. Except as expressly set forth herein to the contrary,
the cost of all such work that does not involve types or quantities of materials
that are different than or in excess of the types and quantities of Building
Standard materials typically utilized by Landlord shall be borne by Landlord. If
"Building Standard" is not specifically defined herein it shall be defined as
those types and quantities of materials customarily used by Landlord for tenant
improvement work at the Building. If any of such work does involve types or
quantities of materials that are different than or in excess of the types and
quantities of Building Standard materials typically utilized by Landlord, Tenant
shall reimburse Landlord for the cost of such additional work within fifteen
(15) days after receipt of Landlord's invoice therefor except as expressly set
forth herein to the contrary.

       (C) Landlord warrants to Tenant that the work performed by Landlord's
contractors pursuant to this Agreement will be free from defects in materials
and workmanship. Landlord's obligation under this warranty shall be limited to
replacing or correcting any such defects which are discovered within one (1)
year after the Effective Date of this Agreement. Tenant must give Landlord
written notice of such defect within said one (1) year period. This limited
warranty does not apply to damages and defects resulting from abuse, intentional
acts or improper maintenance, operation or use of the New Space by Tenant, its
officers, agents, contractors, employees or invitees. The foregoing warranty is
in lieu of all other warranties, express, implied or statutory, including
warranties of merchantability and fitness for purpose. In no case will Landlord
be liable for special, indirect or consequential damages, including interruption
of Tenant's business or use or occupancy of the New Space and there shall be no
abatement of Rent (as defined in the Lease Agreement) on account of any such
defects in material or workmanship.

           (D) Except for Landlord's work as set forth above, Tenant accepts the
New Space "As-Is." Any improvements or alterations in addition to the above must
be paid for by Tenant and completed in accordance with the terms and conditions
of the Lease Agreement.

                           (INTENTIONALLY LEFT BLANK)

                                  Page 8 of 11

<PAGE>

                                                                   4/97 REVISION

       9   No Broker. Landlord and Tenant represent and warrant to each other
           ---------
that they have not had any dealings or communications with any real estate
broker or agent in connection herewith and agree to indemnify and hold the other
harmless from and against any and all damages, costs and expenses (including
court costs and reasonable attorneys fees) which they may incur as a result of a
claim for compensation or a commission by any real estate broker or agent with
whom the other has dealt or communicated.

                           (INTENTIONALLY LEFT BLANK)

                                  Page 9 of 11

<PAGE>

                                                            KAISER REVISION 2/02

           10. Additions. As of the Effective Date, the following Article
               ---------
(Option to Terminate) shall be added to and made a part of the Lease Agreement:

                                  "ARTICLE 44
                               Option to Terminate

           44.01 Provided Tenant is not in default under this Lease Agreement at
any time from and including the day Tenant gives notice to Landlord as required
below through the date of termination pursuant to this Article, Tenant shall
have the option to terminate this Lease Agreement on the first day of the forty
third (43rd) month of the Second Extended Term of this Lease Agreement
("Termination Date") by: (a) giving Landlord written notice of termination
pursuant to this Section; and (b) paying to Landlord, as liquidated damages for
the early termination of this Lease Agreement, an amount equal to _________ the
Additional Space Liquidated Damages defined below (if applicable); no later than
nine (9) months prior to said Termination Date.

           44.02 Time is agreed to be of the essence with respect to the above
notice and all payment requirements, and any attempt by Tenant to terminate this
Lease Agreement at a time or in a manner that is not in strict compliance with
the foregoing requirements shall be null and void and of no effect unless
Landlord waives the deficiency in writing. If Tenant elects to terminate in
accordance with the foregoing, this Lease Agreement shall come to an end at
11:59 P.M., local time, on the day immediately preceding such Termination Date,
as if such date were the expiration date of this Lease Agreement

           44.03 This Article and Tenants Option to Terminate shall be personal
to the Tenant herein named Kaiser Ventures, LLC and shall be immediately null
and void and of no effect if such original Tenant assigns this Lease Agreement
with or without Landlords consent in accordance with Article 18 hereof.

           44.04 In the event that Tenant obtains any additional space
("Additional Space") during the Second Extended Term of this Lease Agreement
pursuant to an express provision of this Lease Agreement or otherwise, Tenant
shall pay to Landlord additional space liquidated damages ("Additional Space
Liquidated Damages") in an amount equal to the unamortized amount as of the
Termination Date of the sum of the following costs related to the Additional
Space:

     (i)   All brokerage commissions and legal fees paid or incurred by Landlord
           in connection with said Additional Space, plus;
                                                     -----

     (ii)  The costs of all tenant improvement work (and all architectural fees
           associated therewith) paid or incurred by Landlord in connection with
           said Additional Space, plus;
                                  ----

     (iii) The dollar value of any rent concessions, including but not limited
           to any "free rent" provided in connection with said Additional Space.

 All of the foregoing costs shall be amortized on a straight line basis over the
remaining Second Extended Term of this Lease Agreement. Tenant shall pay the
Additional Space Liquidated Damages to Landlord concurrently with Tenant's
written notice of termination pursuant to this Section.

     11.   Miscellaneous and Signatures.
     -----------------------------------

           (A) Gender and Context. As used herein, all terms shall include the
               ------------------
singular and plural, and all genders as the context may reasonably require.

           (B) Counterparts. This Agreement may be executed in multiple
               ------------
counterparts each of which said executed counterparts shall be deemed an
original for all purposes.

                                  Page 10 of 11

<PAGE>

             (C) Controlling Law. This Agreement shall be interpreted, governed
                 ---------------
and construed pursuant to the laws of State where the Demised Premises are
located.

             (D) Severability. In the event that any provisions or clauses of
                 ------------
this Agreement conflict with or are contrary to applicable law, such conflicting
or contrary provisions shall not affect any other provisions which can be given
effect without the conflicting provisions, and to this end, the provisions of
this Agreement are declared to be severable to allow the striking of any and all
provisions which conflict with or are contrary to law while all other provisions
of this Agreement shall continue to be effective and fully operable.

             (E) Time of Essence. Time is of the essence, with respect to all
                 ---------------
the obligations and covenants in this Agreement.

             (F) Ratification. All of the other provisions of the Lease
                 ------------
Agreement, are hereby ratified and confirmed and shall remain unchanged and in
full force and effect except to the extent that they are inconsistent with the
foregoing.

             (G) Defined Terms. Landlord and Tenant agree that all capitalized
                 -------------
terms, if any, not defined herein shall have the applicable definition given to
said term in the Lease Agreement.

             (H) Entire Agreement. This Agreement contains the entire agreement
                 ----------------
between the Landlord and Tenant with respect to the subject matter hereof and
any purported agreement hereafter made shall be ineffective to change, modify,
discharge or waive it in whole or in part unless it is in writing and signed by
the party against whom enforcement is sought.

             (I) Conflicts with Exhibits. Any and all Exhibits attached hereto
                 -----------------------
and made a part hereof are subordinate in nature to this Agreement and if there
is anything therein which is inconsistent with this Agreement, this Agreement
shall govern.

             (I) No Option. The submission of this Agreement to Tenant for
                 ---------
examination does not constitute a reservation of or option for the amendments
set forth herein. This Agreement shall be effective and binding only upon
execution and delivery thereof by both Landlord and Tenant.

       IN WITHNESS WHEREOFF, the parties have executed this Agreement as of the
day and year first above written.

ATTEST:                                  LANDLORD:
                                         Lord Baltimore Capital Corporation

By: /s/ Jonathan Newman                  By: /s/ Allan E. Kerry
    ---------------------                    --------------------------
    Jonathan Newman                          Allan E. Kerry, President

ATTEST:                                  TENANT:
                                         Kaiser Ventures LLC

By: _____________________                By: /s/ Paul E. Shampay
                                             -----------------------------------
    Secretary or Assistant Secretary     Name:    Paul E. Shampay
                                                  ------------------------------
    Of Tenant's Corporation              Title: Title Vice President - Finance
                                                      --------------------------

                                  Page 11 of 11<PAGE>

                                                                   Exhibit 10.25

                            Indemnification Agreement
                            -------------------------

         This AGREEMENT, made and entered into as of the 10/th/ day of July,
2001, by and between KAISER VENTURES LLC., a Delaware limited liability company
(the "Company") and ___________________("Manager").

                              W I T N E S S E T H:
                              - - - - - - - - - -

         WHEREAS, Manager in the course of his current and future service to the
Company may be made a party to a legal action or other proceeding which may
result in personal economic loss to Manager; and

         WHEREAS, the Company desires to retain the current and future services
of Manager and to reimburse Manager for any such personal economic losses of
Manager resulting from the good faith performance of Manager's duties; and

         WHEREAS, the indemnification provisions of the Operating Agreement of
the Company, as it may be amended from time to time, may be subject to reduction
or elimination at any time without the consent of Manager, and Company desires
to provide indemnification to Manager to the fullest extent permitted by law
despite any such change.

         NOW, THEREFORE, in consideration of the services of Manager to the
Company, Company and Manager agree as follows:

         1.  Indemnification. The Company agrees to indemnify Manager according
to the terms, conditions and procedures of this Agreement and Exhibit A attached
hereto and incorporated herein by this reference from the effective date hereof
in perpetuity. Any Capitalized Terms not defined herein shall be as defined in
Exhibit A.

         2.  Notice; Right to Counsel. Within 30 days after receiving notice of
any claim or threatened claim against Manager by reason of the fact that he is
or was a manager, officer, employee or agent of the Company or is or was serving
at the request of the Company as a manger, director, officer, employee or agent
of another Person, Manager shall notify the Company in writing. Failure to so
notify the Company shall not relieve the Company form any liability under this
Agreement, except to the extent that the failure to give such notice is
detrimental to the Company. Furthermore, Manager shall have the right to select
his or her own legal counsel in the defense of any such claim or threatened
claim; provided, however, in the event that any other Indemnified Person(s) are
not known to be in any substantially different legal position with respect to
such claim or threatened claim, the Company will reimburse Manager and all such
other Indemnified Persons for the cost of only one counsel, who shall be
reasonably selected by the majority of the Indemnified Persons to be so
represented.

         3.  Amendments to Limited Liability Operating Agreement. Any
amendments to Limited Liability Operating Agreement of the Company ("Operating
Agreement") which reduce or eliminate indemnification rights of persons there
under shall have no effect with respect to this Agreement or the rights granted
hereunder, and thereafter Manager shall continue to have all the rights granted
hereunder, regardless of such amendments to the Operating Agreement [for future
acts as well?]. However, if the Operating Agreement of the Company or the
Delaware Limited Liability Company Act (the "Act") are amended to provide for
greater indemnification

                                       1

<PAGE>

rights or privileges, this Agreement shall not be construed so as to limit
Manager's rights and privileges to the terms hereof, and Manager shall be
entitled to the full benefit of any such additional rights and privileges.
Furthermore, to the extent that the Act or other applicable law now or hereafter
establishes that indemnification cannot be made by the Company according to this
Agreement in any respect, this Agreement shall be interpreted as being
simultaneously amended to provide indemnification hereunder to the fullest
extent permitted by law.

          4. Successors and Assigns. This Agreement shall be binding upon and
shall inure to any and all successors, assigns, heirs, estates, representatives
and administrators of the parties hereto.

          5. No Amendments. This Agreement may not be amended, modified or
terminated except by the express written consent thereto by both parties hereto.

          6. Other Agreement. This Agreement is supplementary to and not
exclusive of other agreements between the Company and Manager, which may exist
now, or in the future to the extent such agreements are not inconsistent
herewith.

          7. Survival. The rights of Manager under this Agreement shall survive
and continue in effect after the termination of services to the Company by
Manager, whether by death, retirement or otherwise.

          8. Severability. If any provision or application of this Agreement is
held unlawful or unenforceable in any respect, such illegality or
unenforceability shall not affect other provisions or applications which can be
given effect, and this Agreement shall be construed as if the unlawful or
unenforceable provision or application had never been contained herein or
prescribed hereby.

          9. Governing Law. This Agreement shall be interpreted and governed by
the laws of the State of Delaware.

          IN WITNESS WHEREOF, the undersigned parties have executed this
Agreement effective as of, notwithstanding the actual date of execution.

"Company"                                        "Manager"
Kaiser Ventures LLC

By:
     _____________________________________       __________________________
     Richard E. Stoddard, CEO & President        Manager

                                        2

<PAGE>

                                   Exhibit "A"
                                   ----------

1.        Definitions.  In addition to any other term defined in this Agreement,
the following terms shall have the meaning specified below.

          1.1 "Board" means the Board of Managers of the Company.

          1.2 "Company" means Kaiser Ventures LLC, a Delaware limited liability
company.

          1.3 "Expenses" includes reasonable attorneys' fees, disbursements and
retainers, court costs, transcript costs, fees of accountants, experts and
witnesses, travel expenses, duplicating costs, printing and binding costs,
telephone charges, postage, delivery, service fees, and all other 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 or other participant in a Proceeding.

          1.4 "Indemnified Person" means a manager, officer or employee of the
Company.

          1.5 "Liabilities" means (i) any Expenses and (ii) any other judgments,
fines, penalties, ERISA excise taxes, and amounts paid in settlement of any
claim, in connection with any Proceeding.

          1.6 "Person or "person" means an individual, general partnership,
limited partnership, limited liability company, corporation, trust, estate, real
estate investment trust association or any other entity.

          1.7 "Proceeding" means any action, suit, arbitration, alternative
dispute resolution mechanism, investigation, administrative hearing or other
proceeding, whether civil, criminal, administrative or investigative in nature,
except a proceeding initiated by a Person pursuant to Section 2.

2.        Indemnification of Indemnified Persons.

          2.1 General. The Company shall indemnify any Indemnified Person
against all Liabilities that he or she has actually and reasonably incurred or
paid in connection with a Proceeding described in Section 3.1 if he or she (i)
meets the standard of conduct described in Section 2.2, and (ii) properly makes
application for indemnification as described in Section 3. The Board may, in its
sole discretion, indemnify any other Person, who is not an Indemnified Person,
against all Liabilities that such Person has actually and reasonably incurred or
paid in connection with a Proceeding on terms determined by the Board at that
time, which terms may be less favorable to the indemnitee than those described
in the mandatory indemnification provisions below.

          2.2 Standard of Conduct. The Company shall only indemnify a Person if,
in connection with his or her actions which are the subject of the Proceeding,
(i) he or she shall have acted in good faith and in a manner he or she
reasonably believed was consistent with the best interests of the Company, and
(ii) if the Proceeding is a criminal Proceeding, he or she had no reasonable
cause to believe that his or her conduct was unlawful. The Company shall not
indemnify any Person if that Person's action is finally adjudged to have been
willful misconduct, knowingly fraudulent or deliberately dishonest.

                                       3

<PAGE>

          2.3  Burden of Proof. An Indemnified Person shall be conclusively
presumed to have met these standards of conduct unless a court of competent
jurisdiction finally determines to the contrary. The Company shall bear the
burden of proof of establishing by clear and convincing evidence that such
Indemnified Person failed to meet the applicable standard of conduct. The
termination of any Proceeding, whether by judgment, order, settlement or
conviction, or upon a plea of nolo contendere or its equivalent, shall not, of
itself, create a presumption that an Indemnified Person did not meet the
applicable standard of conduct.

          2.4  Payment of Expenses. Expenses incurred by an Indemnified Person
in connection with a Proceeding shall be paid by the Company in advance of the
final disposition of the Proceeding upon receipt of his or her written
undertaking to repay any advances if it is ultimately determined that he or she
is not entitled to be indemnified by the Company as authorized in this
Agreement.

3.        Application for Indemnification.

          3.1  Proceedings Covered. Any Person may apply for indemnification if
he or she was or is a party to, or is threatened to be made a party to, or
otherwise becomes involved in, any Proceeding (including any Proceeding by or in
the right of the Company), in the case of an Indemnified Person, because of his
or her status as such, and in the case of any other Person, because he or she is
or was an agent of the Company. Except with the consent of the Board or as
provided in Section 3.3 with respect to a Proceeding brought to establish or
enforce a right to indemnification under this Agreement, the Company will not be
required to indemnify any Person, including any Indemnified Person, with respect
to a Proceeding or portion of a Proceeding which that Person initiated or
brought voluntarily and not by way of defense.

          3.2  Content of Application. The application for indemnification shall
be in writing, shall state the basis for the claim for indemnification, and
shall include a copy of any notice or other document served on or otherwise
received by the Person making the application. The application shall also
contain a statement that the Person making the application has met the
applicable standard of conduct described in Section 2.2 and will comply with the
provisions of this Agreement.

          3.3  Determination of Right to Indemnification. The determination of
whether or not to indemnify an Indemnified Person in connection with any
Proceeding shall be made by any of the following means:

               (i)   by the managers of the Company, by a majority vote of a
quorum consisting of managers who are not parties to the Proceeding; or

               (ii)  if no such quorum is obtainable or, even if obtainable, a
quorum of the disinterested managers of the Company so directs, by independent
legal counsel in a written opinion; or

               (iii) by the members of the Company, by a vote of a Majority (as
defined in the Operating Agreement) of those members, whether or not
constituting a quorum, who are not parties to the Proceeding.

4.        Enforcement of Indemnification Right. The right of an Indemnified
Person to indemnification or an advance of Expenses as provided by this
Agreement shall be enforceable in

                                       4

<PAGE>

any court of competent jurisdiction. Any determination by the managers of the
Company, members of the Company, or the Company's independent legal counsel that
indemnification or an advance is improper in the circumstances, or any failure
to make such a determination, shall not be a defense to the action or create a
presumption that the relevant standard of conduct has not been met. An
Indemnified Person's Expenses incurred in connection with any Proceeding brought
to enforce his or her right to indemnification shall also be indemnified by the
Company, regardless of the outcome, unless a court of competent jurisdiction
finally determines that each of the material assertions made by such Indemnified
Person in the Proceeding was not made in good faith or were frivolous.

5.        Limitations on Indemnification. No payments pursuant to this
Agreement shall be made by the Company if a court of competent jurisdiction
finally determines that any indemnification or advance of Expenses hereunder is
unlawful.

6.        Insurance.

          6.1  General. The Company shall have the power to purchase and
maintain insurance or other financial arrangement on behalf of any Person who is
or was a Company Person or an agent of the Company against any liability
asserted against such Person and incurred by such Person in any such capacity,
or arising out of such Person's status as a Company Person or agent, whether or
not the Company would have the power to indemnify such Person against such
liability under the provisions of this Agreement.

          6.2  Company Right to Reimbursement. If a Person receives payment from
any insurance carrier, or from the plaintiff in any action against such Person,
with respect to indemnified amounts after payment of such indemnified amounts
have been made by the Company pursuant to this Agreement, such Person shall
reimburse the Company for the amount by which the sum of (i) the payment by the
insurance carrier or plaintiff and (ii) all payments by the Company to such
Person, exceeds such indemnified amounts. In making this calculation, any
insurance proceeds that are required to be reimbursed to the insurance carrier
under the terms of its insurance policy shall not be counted as payments to such
Person. In addition, upon payment of indemnified amounts under the terms and
conditions of this Agreement, the Company shall be subrogated to such Person's
rights against any insurance carrier with respect to such indemnified amounts
(to the extent permitted under such insurance policies). Such right of
subrogation shall be terminated upon receipt by the Company of the amount to be
reimbursed by such Person pursuant to the second sentence of this Section 6.3.

7.        Other Terms of Indemnification.

          7.1  Timing of Payments. Any indemnification or advance shall be made
promptly, but in any case no later than thirty (30) days after the Company has
received a written request for payment from the Indemnified Person seeking
indemnification, unless the Company has determined that he or she is not
entitled to indemnification hereunder.

          7.2  Partial Indemnification. If an Indemnified Person is entitled
under any provision of this Agreement to indemnification for a portion of his or
her Liabilities, but not for the total amount, the Company shall nevertheless
indemnify him or her for the portion of such Liabilities to which he or she is
entitled, except that no indemnification shall be given for Expenses in
connection with a Proceeding brought by the Company if he or she is found liable
on any portion of the claims in such Proceeding.

                                       5

<PAGE>

          7.3  Indemnity Not Exclusive. The indemnification and advancement of
Expenses provided by this Agreement shall not be exclusive of any other rights
to which any Indemnified Person seeking indemnification or advancement of
Expenses may be entitled under any agreement, vote of Members, determination of
the Board, or otherwise, both as to action in such Indemnified Person's capacity
as such and as to action in another capacity while serving as an Indemnified
Person. Any repeal or modification hereof or thereof shall not affect any such
rights then existing.

          7.4  Heirs, Executors and Administrators. The indemnification and
advancement of Expenses provided by this Agreement shall, continue as to an
Indemnified Person who is no longer acting in such capacity, and shall inure to
the benefit of his or her heirs, executors and administrators, unless otherwise
provided when authorized or ratified.

                                       6

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