Exhibit 10.1
SEPARATION AGREEMENT
          This Separation Agreement (the “Agreement”) is entered into by and
between, and shall inure to the benefit of and be binding upon, the following
parties:
          ROBERT A. DEASON, hereinafter referred to as “Mr. Deason”; and
          J. RAY McDERMOTT, INC., hereinafter referred to as the “Company.”
WITNESSETH:
          WHEREAS, Mr. Deason resigned from employment with the Company
effective March 31, 2010 (the “Resignation Date”); and
          WHEREAS, the Company and Mr. Deason mutually desire to establish and
agree upon the terms and conditions of Mr. Deason’s separation from service.
          NOW, THEREFORE, in consideration of the mutual promises and
obligations set forth herein, Mr. Deason and the Company hereby agree as
follows:

1.   Payments by the Company. Mr. Deason acknowledges receipt of 100,000 shares
of McDermott International, Inc. common stock attributable to Deferred Stock
Units previously awarded to him that vested on December 31, 2009, which shares
were deposited into his Charles Schwab account on January 5, 2010. If a bonus is
paid to Company employees for fiscal year 2009 and/or 2010 under the McDermott
International, Inc. Executive Incentive Compensation Plan (the “EICP”), the
Company will pay a bonus to Mr. Deason. The gross amount of the 2009 bonus, if
any, shall be calculated by multiplying Mr. Deason’s annualized base salary on
January 1, 2010 by 70% and multiplying the resulting product by the applicable
performance factor (not to exceed 2X). The gross amount of the 2010 bonus shall
be calculated by multiplying Mr. Deason’s annualized base salary on January 1,
2010 by 70%, multiplying the resulting product by the applicable performance
factor (not to exceed 2X) and multiplying the resulting figure by 3/12. Any 2009
or 2010 bonus shall be paid in accordance with the

 

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

 

    Company’s customary practice, but in no event later than March 15, 2010 and
March 15, 2011, respectively, and shall be subject to appropriate tax
withholdings.       Mr. Deason previously received certain awards (the “Awards”)
under the McDermott International, Inc. 2001 Directors and Officers Long Term
Incentive Plan (the “LTIP”). Subject to the provisions of Paragraph 6 below,
Mr. Deason’s outstanding unvested Awards shall remain in full force and effect
during the period from the Resignation Date through March 31, 2012 and any
Awards scheduled to vest during that period shall become vested and payable in
accordance with the terms of the LTIP and the applicable Grant Agreement. All
other outstanding unvested Awards not scheduled to vest during that period shall
be forfeited, unless a Change in Control (as defined in the LTIP) occurs and
results in an early vesting on or before March 31, 2012. Mr. Deason agrees that
the Awards are hereby modified to provide that no Change in Control shall occur
unless it constitutes a “change in ownership or control” within the meaning of
Internal Revenue Code Section 409A and regulations and rulings issued
thereunder. Any statutory minimum income and/or employment tax withholding
required in connection with the Awards will be satisfied by share withholding
unless Mr. Deason notifies the Stock Plan Administrator of McDermott
International, Inc. in writing that he will satisfy such withholding obligation
in cash.   2.   Retiree Benefits. Mr. Deason shall be entitled to receive his
vested account balance in the McDermott International, Inc. New Supplemental
Executive Retirement Plan (“SERP”), which shall be distributed in accordance
with Mr. Deason’s existing elections, copies of which are attached hereto as
Exhibit A. If a Company contribution is made on behalf of SERP participant for
plan year 2010, Mr. Deason’s SERP account shall be credited with a 2010 Company
contribution.   3.   Consulting Services. During the period beginning on the
April 1, 2010 and ending on September 30, 2010, (the “Consulting Period”)
Mr. Deason shall provide such cooperation and consulting services as the Company
requests in accordance with the terms and conditions set forth in Exhibit B
which is attached hereto and incorporated herein by reference. The Consulting
Period may be extended for up to an additional six

-2-

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

 

    (6) months by mutual agreement of the parties. It is expressly understood
and agreed by the parties that in no event will the level of consulting services
performed by Mr. Deason hereunder exceed 20% of the average level of services he
performed over the 36 month period ending on the Resignation Date.

4.   Release of Claims. In consideration of the foregoing, the adequacy of which
is hereby expressly acknowledged, Mr. Deason hereby unconditionally and
irrevocably releases and forever discharges, to the fullest extent applicable
law permits, the “Releasees,” as defined below, from any and every waivable
action, cause of action, complaint, claim, demand, administrative charge, legal
right, compensation, obligation, damages (including consequential, exemplary and
punitive damages), liability, cost and/or expense (including attorney’s fees)
that he has, may have or may be entitled to from or against the Releasees,
whether legal, equitable or administrative, in any forum or jurisdiction,
whether known or unknown, foreseen or unforeseen, matured or unmatured, accrued
or not accrued which arises directly or indirectly out of, or is based on or
related in any way to Mr. Deason’s employment with or termination of employment
from the Company, its predecessors, successors and assigns and past, present and
future affiliates, subsidiaries, divisions and parent corporations, including,
without limitation, any such matter arising from the negligence, gross
negligence or willful misconduct of the Releasees, (together, the “Released
Claims”); provided, however, that this Release does not apply 1.) to any claims
arising under the Age Discrimination in Employment Act of 1967, as amended,
after the Resignation Date, 2.) to any claim for indemnification (including,
without limitation, under the Company’s organizational documents or insurance
policies) arising in connection with an action instituted by a third party
against the Company, its affiliates or Mr. Deason in his capacity as a former
officer or director of the Company or its affiliates, or 3.) to any claim
arising from any breach or failure to perform this Agreement.       The parties
intend this Release to cover any and all such Released Claims, whether arising
under any employment contract (express or implied), policies, procedures or
practices of any of the Releasees, and/or by any acts or omissions of any of the
Releasees’ agents or employees or former agents or employees and/or whether
arising under any state or federal statute, including but not limited to Texas’
employment

-3-

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

 

    discrimination laws, all federal discrimination laws, the Age Discrimination
in Employment Act of 1967, as amended, the Employee Retirement Income Security
Act of 1974, as amended, all local laws and ordinances and/or common law,
without exception. As such, it is expressly acknowledged and agreed that this
Release is a general release, representing a full and complete disposition and
satisfaction of all of the Company’s real or alleged legal obligations to
Mr. Deason with the exceptions noted above. The term “Releasees” means the
Company, its predecessors, successors and assigns and past, present and future
affiliates, subsidiaries, divisions and parent corporations and all their
respective past, present and future officers, directors, shareholders, employee
benefit plan administrators, employees and agents, individually and in their
respective capacities.       Mr. Deason expressly agrees that neither he nor any
person acting on his behalf will file or permit to be filed any action for legal
or equitable relief against the Releasees involving any matter related in any
way to his employment with, or resignation from employment with the Company, its
predecessors, successors, assigns and past, present and future affiliates,
subsidiaries, divisions and parent corporations, including the matters covered
by the Released Claims. In the event that such an action is filed, Mr. Deason
agrees that the Releasees are entitled to legal and equitable remedies against
him, including an award of attorney’s fees. However, it is expressly understood
and agreed that the foregoing sentence shall not apply to any charge filed by
Mr. Deason with the Equal Employment Opportunity Commission or similar State
agency or to any action filed by Mr. Deason that is narrowly limited to seeking
a determination as to the validity of this Agreement and enforcement thereof.
Should a charge be filed with the Equal Employment Opportunity Commission or
similar State agency by or on behalf of Mr. Deason, or should any governmental
entity, agency, or commission file a charge, action, complaint or lawsuit
against any of the Releasees based on any Released Claim, Mr. Deason agrees not
to seek or accept any resulting relief whatsoever.   5.   Undertakings By
Mr. Deason. Mr. Deason shall immediately return to the Company any and all
documents, records, files, reports, memoranda, books, papers, plans, letters and
any other data in his possession regardless of the medium held or stored that
relate in any way to the business of the Company other than any such data that
the Company deems

-4-

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

 

    necessary for the provision of consulting services requested pursuant to
Paragraph 3 above, and any credit cards, keys, access cards, calling cards,
computer equipment and software, telephone, facsimile or other equipment or
property of the Company. The Company agrees that during the Consulting Period
Mr. Deason may retain his Company provided computer and mobile telephone. In
addition, Mr. Deason hereby resigns from any and all officer and/or director
positions and any other appointed or elected positions he may hold with the
Company and its subsidiaries and affiliates, effective on the Resignation Date.

6.   Confidentiality and Non-Competition Agreement.

  (a)   Definition of Trade Secrets and Confidential Business Information.
Mr. Deason acknowledges and agrees that any and all non-public information
regarding the Company, any of its Subsidiaries and its or their customers
(including but not limited to any and all information relating to its or their
business practices, products, services, finances, customers, equipment,
marketing programs and other business systems and materials, management,
strategy, profits and overhead) is confidential and the unauthorized disclosure
of such confidential information will result in irreparable harm to the Company.
Such confidential information includes the Company property interest in its
trade secrets, including, without limitation, its list of customers and
prospective customers, and other information that has recognized value and that
is not generally available through other sources (“Trade Secrets”) and
information regarding its various products, services, procedures and systems
that is treated as confidential by the Company that may not rise to the level of
a Trade Secret (“Confidential Business Information”). Confidential Business
Information does not include information that properly and lawfully has become
generally known to the public other than as a result of the act or omission of
Mr. Deason. Collectively, Trade Secrets and Confidential Business Information
are referred to hereafter as “Confidential Information.” For the purposes of
this Paragraph 6, the term “Company” shall include, except where the context
indicates otherwise, the subsidiaries and affiliates of McDermott International,
Inc., now and hereafter existing.

-5-

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

 

  (b)   Importance of Confidential Information. The Company hereby agrees to
provide Mr. Deason with Confidential Information during the Consulting Period.
By signing this Agreement, Mr. Deason acknowledges delivery and receipt of
Confidential Information. Mr. Deason acknowledges that during the Consulting
Period he will be making use of, acquiring, accessing and/or adding to such
Confidential Information. Mr. Deason further acknowledges that the preservation
and protection of the Confidential Information is an essential part of
Mr. Deason’s consulting with the Company and that Mr. Deason has a duty of
fidelity and trust to the Company in handling the Confidential Information.    
(c)   Non-Disclosure or Misuse. Mr. Deason agrees that he will not disclose or
take away any of the Confidential Information, directly or indirectly, or use
such information in any way, either during Consulting Period or at any time
thereafter, except as required in the ordinary course of providing consulting
services for the benefit of the Company or as may be required by law.     (d)  
Return of Confidential Information. At the termination of the Consulting Period
for any reason, all documents or other information containing or referring to
the Confidential Information of the Company and its affiliates as may be in
Mr. Deason’s possession, or over which Mr. Deason may have control, and all
other documents, data, records, materials, notes, reports and other property of
the Company or any of its affiliates retained by or provided to Mr. Deason in
connection with his performance of consulting services, regardless of whether
prepared by Mr. Deason, shall be returned by Mr. Deason to the Company
immediately, with no request being required (and Mr. Deason shall not retain,
recreate or deliver to anyone else such information).     (e)   Noncompetition
Agreement. Mr. Deason acknowledges and agrees that information, including the
Confidential Information, Mr. Deason has acquired and will acquire in connection
with the performance of consulting services will enable him to irreparably
injure the Company if he should engage in competition during the Consulting
Period. Ancillary to the above agreements and in consideration of

-6-

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

 

      the consulting fees and Confidential Information provided to Mr. Deason
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Mr. Deason hereby agrees that the following
covenants are reasonable and necessary protective covenants for the protection
of the value of the agreements described in subparagraphs (a), (b), (c) and
(d) above and the other terms and conditions contained in this Agreement:

  i)   During the Consulting Period, Mr. Deason shall not, directly or
indirectly, without the prior written approval of the Company, act in any
capacity for, be employed by, provide services to, or contract with any other
company or entity engaged in Competing Services (a “Competitive Entity”), or
acquire any interest of any type in any Competitive Entity; provided, however,
that the foregoing shall not be deemed to prohibit Mr. Deason from acquiring,
solely as an investment and through market purchases, securities of any
Competitive Entity which are registered under Section 12(b) or 12(g) of the
Securities and Exchange Act of 1934 and which are publicly traded, so long as
Mr. Deason is not part of any control group of such Competitive Entity and such
securities, including converted securities, do not constitute more than one
percent of the outstanding voting power of that entity. For the purposes of this
Agreement, the phrase “Competing Services” shall mean any services that are the
same as or similar to the services currently being provided or offered by the
Company and/or which are provided or offered by the Company during the
Consulting Period; Competing Services include but are not limited to
engineering, construction, installation and project management services to
offshore oil and gas field development;     ii)   During the Consulting Period,
Mr. Deason shall not, directly or indirectly, solicit the Company’s Protected
Customers for the purpose of engaging in any business which is the same as or
similar to the business in which the Company is engaged. The phrase “Protected
Customers” means all persons or entities with whom Mr. Deason has had contact

-7-

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

 

      with by virtue of Mr. Deason’s position with the Company, and to whom the
Company or any of its affiliates has sold any product or service, whether or not
for compensation, within a period of one (1) year prior to the time the
Consulting Period terminates.     iii)   During the Consulting Period,
Mr. Deason shall not, on his own behalf or on behalf of any other person or
entity, solicit, divert or recruit any person who is, during such time frame, an
employee of the Company or any subsidiary or affiliate, to leave such employment
or in any other manner attempt, directly or indirectly, to influence, induce, or
encourage any employee of the Company to leave the employment of the Company.

  (f)   Notification of Restrictions to Third Parties. Mr. Deason agrees that
the Company may notify any person or entity employing or contracting with
Mr. Deason or evidencing an intention of employing or contracting with Mr.
Deason during the Consulting Period of the existence and provisions of this
Agreement.     (g)   Enforcement of Covenants. Either party may seek a temporary
restraining order, preliminary injunction, specific performance or other
equitable relief regarding the other party’s obligations set forth in this
Paragraph 6 before a court of law pending a final resolution of the disputes
between the parties before an arbitrator, and either party may seek a judgment
including a permanent injunction, if appropriate, from the court based on the
final decision of the arbitrator. In addition, in the event that the Company
determines that the Mr. Deason has breached any term of this Paragraph 6, in
addition to any other remedies at law or in equity the Company may have
available to it, it is agreed that the Company shall be entitled, upon
application to any court of proper jurisdiction, to a temporary restraining
order or preliminary injunction (without the necessity of (i) proving
irreparable harm, (ii) establishing that monetary damages are inadequate, or
(iii) posting any bond with respect thereto) against Mr. Deason prohibiting

-8-

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

 

      such breach or attempted or threatened breach by proving only the
existence of such breach or attempted or threatened breach.

  (h)   Right of Court or Arbitrator to Reform Restrictions. The Company and
Mr. Deason state that it was their intent to enter into a valid and enforceable
agreement. Mr. Deason and the Company hereby acknowledge the reasonableness of
the restrictions set forth in Paragraph 6, including the reasonableness of the
geographic area, duration as to time and scope of activity restrained.
Mr. Deason further acknowledges that his skills are such that he can be
gainfully employed in noncompetitive employment and that the Agreement not to
compete does not prevent him from earning a living. Mr. Deason agrees that if a
court or arbitrator finds that this Paragraph 6 contains limitations as to time
or scope of activity to be restrained that are not reasonable and impose a
greater restraint than is necessary to protect the goodwill or other business
interest of the Company and its affiliates, the court or arbitrator may reform
the covenants to the extent necessary to cause the limitations contained in this
Paragraph 6 as to time or scope of activity to be reasonable and to impose a
restraint that is not greater than necessary to protect the goodwill or other
business interest of the Company and its affiliates, and enforce Paragraph 6 of
this Agreement.     (i)   Repayment and Forfeiture. Mr. Deason agrees that in
the event that (i) Mr. Deason breaches any term of Paragraph 4 or Paragraph 6 of
this Agreement, or (ii) Mr. Deason challenges the validity of all or any part of
Paragraph 6 and all or any party of Paragraph 6 is found invalid or
unenforceable for any reason whatsoever by a court of competent jurisdiction or
an arbitrator in a proceeding between Mr. Deason and the Company or its
affiliates, in addition to any other remedies at law or in equity the Company
may have available to it, the Company shall not be obligated to make any of the
payments or to provide for any of the benefits specified in Paragraphs 1 and 2
of this Agreement, and shall be entitled to recoup any amounts paid to the
Mr. Deason and the value of any benefit provided under this Agreement on and
following the Resignation Date, through either (A) the date of a material breach
by the Mr. Deason of the provisions of Paragraph 4

-9-

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

 

      or 6, which breach continues without having been cured within fifteen
(15) days after written notice to Mr. Deason specifying the breach in reasonable
detail, or (B) the date of the determination of invalidity or unenforceability
by the court or arbitrator, as applicable.

7.   Miscellaneous Provisions.

  (a)   Failure on the part of the Company or Mr. Deason at any time to insist
on strict compliance by the other party with any provisions of this Agreement
shall not constitute a waiver of either party’s obligations in respect thereof,
or of either party’s right hereunder to require strict compliance therewith in
the future.     (b)   The obligations set forth in this Agreement are severable
and divisible, and the unenforceability of any clause or portion thereof shall
not affect the enforceability of the remainder of such clause or of any other
obligation contained herein.

8.   Entire Agreement. Mr. Deason and the Company agree and acknowledge that
this Agreement. contains and comprises the entire agreement and understanding
between the parties, that no other representation, promise, covenant or
agreement of any kind whatsoever has been made to cause any party to execute
this Agreement, and that all agreements and understandings between the parties
are embodied and expressed in the foregoing agreements. The parties also agree
that the terms of this Agreement shall not be amended or changed except in
writing and signed by Mr. Deason and a duly authorized agent of the Company. The
parties to this Agreement further agree that this Agreement shall be binding on
and inure to the benefit of Mr. Deason, the Company and the Releasees as defined
in this Agreement. Any other agreements or understandings between the parties,
whether written or oral, are hereby null and void.

9.   Timing and Consultation with Counsel. Mr. Deason acknowledges that he has
been given a reasonable period of time within which to consider this Agreement
and has been advised to discuss the terms of this Agreement with legal counsel.
Mr. Deason acknowledges that this Agreement was offered to him on January 19,
2010, that he was advised that (i) it could be executed at any time prior to
5:00 pm, central time on

-10-

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

 

    February 9, 2010, and (ii) if accepted, the Agreement could be revoked, in
writing, for up to seven (7) days following the date of such acceptance. Based
upon his review, Mr. Deason acknowledges that he fully and completely
understands and accepts the terms of this Agreement, including the Release in
Paragraph 4, and enters into it freely, voluntarily and of his own free will.

10.    Applicable Law. This Agreement shall be interpreted and construed in
accordance with the laws of the State of Texas.

-11-

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

 

I HAVE READ THE FOREGOING SEPARATION AGREEMENT, FULLY UNDERSTAND IT AND HAVE
VOLUNTARILY EXECUTED IT ON THE DATE WRITTEN BELOW, SIGNIFYING THEREBY MY ASSENT
TO, AND WILLINGNESS TO BE BOUND BY, ITS TERMS:

         
Date: ____________
       
 
  Robert A. Deason    

           Before me, a Notary Public in and for _________ County, Texas, and
for Robert A. Deason, personally appeared the above-named Robert A. Deason, who
acknowledged that he did sign the foregoing instrument, and that the same is his
free act and deed.
          IN TESTIMONY WHEREOF, I have hereunto set my hand and official seal at
__________________, this ______ day of _______________, 2010.

                  NOTARY PUBLIC

J. RAY McDERMOTT, INC.
      By:                        

          Before me, a Notary Public in and for ____________ County, Texas,
personally appeared the above-named J. Ray McDermott, Inc. through ____________,
its ____________, who acknowledged that he did sign the foregoing instrument for
and on behalf of J. Ray McDermott, Inc., and that the same is the free act and
deed of J. Ray McDermott, Inc. and the free act and deed of him as its agent.
          IN WITNESS WHEREOF, I have hereunto set my hand and official seal at
_____________________, this ______ day of _______________, 2010.

                        NOTARY PUBLIC         

-12-

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

 

         

EXHIBIT B
CONSULTING SERVICES
TERMS AND CONDITIONS

1.   Description of Services — As requested by the Company, Mr. Deason shall
serve as a special consultant furnishing advice, consultation and related
services including but not limited to:

  1.   Provide advice and counsel on strategic issues     2.   Provide input on
organizational structure and key personnel     3.   Provide advice and counsel
on project issues as they arise     4.   Provide input on key client and
business partner issues as requested     5.   Perform duties as Board member for
industry associations (IPLOCA, NOIA)

2.   Status — During the Consulting Period, Mr. Deason shall be an independent
contractor and shall not be an employee of the Company. The Company shall not be
entitled to exercise supervision over the details or methods of performance by
Mr. Deason hereunder or to require adherence to specific procedures in
performing services hereunder. Except as provided herein, Mr. Deason shall not
be subject to rules or regulations applicable to Company’s employees or any
established work schedule or routine or other supervision of or direction by
Company, as to hours worked or otherwise, provided, however, that all services
rendered hereunder shall be so rendered to the satisfaction of Company.
Mr. Deason shall not have authority to obligate the Company to any agreement or
to exercise any supervision or direction over the Company’s employees. Since the
Consultant is not an employee of the Company, he is not entitled to participate
in any of the Company’s employee benefit plans, programs or arrangements
provided, however, the retirement and other payments or benefits that he may be
entitled to as a result of previous employment with the Company shall continue
uninterrupted in accordance with the terms and conditions of each respective
benefit plan or arrangement.

3.   Compensation — Mr. Deason’s individual contact shall be Stephen M. Johnson,
or his designee, who shall be responsible for transmitting requests for such
advice and consultation from the Company where necessary to enable Mr. Deason to
carry out his responsibilities hereunder. During the period from April 1, 2010
through September 30, 2010, the Company agrees to pay $25,000.00 per month,
which amount will be payable on the last day of each calendar month. The Company
also agrees to reimburse Mr. Deason actual reasonable costs and expenses of
first class airfare and other travel, meals and lodging necessarily incurred by
Mr. Deason in rendering services hereunder, but not any other fees, costs, or
expenses. Mr. Deason shall submit a statement for each month in which services
are rendered showing costs and expenses payable with respect to services
rendered during such month along with documentation substantiating expenses for
which reimbursement is sought. The Company agrees to remit to Mr. Deason the
appropriate amount upon receipt of such invoices. Mr. Deason will be responsible
for income or other taxes assessed on his receipt of the monthly fee and expense
reimbursement from the Company.

-13-

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

 

4.   Security and Non-Disclosure of Information — Mr. Deason shall be
responsible for, and bear the expense of, compliance with governmental laws and
regulations applicable to the procurement, utilization or production of
information in connection with the furnishing of services hereunder. Mr. Deason
agrees that during the Consulting Period he will refrain from performing any act
or engaging in any course of conduct which has or may reasonably have the effect
of demeaning the name or business reputation of the Company or affects adversely
or may reasonably affect adversely the Company’s best interests, economic or
otherwise. Mr. Deason also acknowledges that applicable securities laws prohibit
the trading of Company securities while in possession of any material non-public
information, including information concerning the financial condition, results
of operations, business or prospects of the Company.

5.   Property and Information — All property and information, including but not
limited to reports, findings, recommendations, plans, data, and memoranda of
every description, and all copies thereof, furnished to Mr. Deason or developed
in the course of or relating to the services rendered hereunder shall be the
property of the Company and Mr. Deason shall not retain copies of any such
matter or material. Mr. Deason agrees that all inventions, discovery or
improvements (whether patentable or not) made or conceived by Mr. Deason are and
will remain the sole property of the Company, and Mr. Deason further agrees to
assist the Company in obtaining patents in the Company’s name covering any such
inventions, discoveries or improvements.

6.   Law — Mr. Deason will comply with all applicable laws and regulations in
the course of his activities on the Company’s behalf.

7.   Code of Business Conduct — Mr. Deason expressly acknowledges that he has
received and reviewed the most recent McDermott International Code of Business
Conduct and Mr. Deason will conform his activities undertaken for or on behalf
of the Company consistent with the principles of the highest ethical behavior as
described therein.

         
Signature:
      Date: __________________
 
       
 
  Robert A. Deason    

8.   Reports — Mr. Deason agrees that upon request, he will file periodic
reports on his activities on the Company’s behalf.

9.   Indemnity — Company agrees to protect, hold harmless, defend, and indemnify
Mr. Deason from and against any and all claims, suits, and demands, of any kind
whatsoever, by whomsoever asserted, as a result of, or arising from, the
activities of Mr. Deason under this Agreement; provided however that the Company
shall have no liability or responsibility under this provision for any such
claim, suit, or demand resulting from the gross negligence or intentional
misconduct of Mr. Deason.

10.   Conflict of Interest — Mr. Deason agrees that he is not presently engaged
and will not engage during the term of this Agreement in any activity which
might reasonably create a conflict of interest between him and the Company or
which might reasonable and

-14-

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

 

    adversely affect his judgment with respect to the business of the Company.
Mr. Deason further agrees that he will accept no payment from any competitor or
supplier of materials or services, customer, borrower, or lender of the Company.

11.   Consulting Period — The Consulting Period shall begin on April 1, 2010 and
continue through September 30, 2010, unless terminated earlier by Mr. Deason
upon thirty (30) days advance written notice to the Company. The Consulting
Period may be extended for up to an additional six (6) months under mutually
agreeable terms and conditions. The Consulting Period will be terminated without
further liability or obligation on the part of the Company should Mr. Deason
breach any of the terms or covenants of Exhibit B or the Agreement.

-15-