Document:

deepdown_8k-ex1001.htm

Exhibit 10.1

 

INDEMNIFICATION AND CONTRIBUTION AGREEMENT

 

This Indemnification and Contribution Agreement (this “Agreement”), dated as of October 7, 2011, is made by and among York Special Opportunities Fund, L.P., a Delaware limited partnership (“YSOF”), Flotation Investor, LLC, a Delaware limited liability company (“FI”), Deep Down, Inc., a corporation existing under the laws of Nevada (“DPDW” and, together with FI, the “Contributors”) and Cuming Flotation Technologies, LLC, a Delaware limited liability company (“CFT”).  All capitalized terms used herein but not otherwise defined herein shall have the meaning given to such terms in the Purchase Agreement (as defined below).

 

WHEREAS, pursuant to that certain Purchase and Sale Agreement (the “Purchase Agreement”), dated as of the date hereof, between CFT, Ameriforge Group Inc., a Texas corporation (“AMFG”) and Flotation Tech LLC, a Delaware limited liability company (“Flotec”), AMFG has acquired all of the issued and outstanding capital stock of Cuming Corporation from CFT and certain assets and properties from Flotec;

 

WHEREAS, (i) FI owns 80% of the interest in CFT and (ii) DPDW owns 20% of the interest in CFT, (for each Contributor, its “Member Percentage”);

 

WHEREAS, pursuant to the Purchase Agreement, CFT has agreed to certain indemnification obligations in favor of AMFG (the “Indemnification Obligations”) which obligations shall first be satisfied from the Escrow Amount in the Escrow Account;

 

WHEREAS, pursuant to the Limited Guaranty, dated as of the date hereof, by YSOF in favor of AMFG (the “Guaranty Agreement”), YSOF has agreed to guaranty certain Indemnification Obligations of CFT under the Purchase Agreement (the “Guaranty Obligations”); and

 

WHEREAS, the Contributors desire to (i) provide certain rights of contribution and indemnification between themselves with respect to indemnification payments made by CFT in excess of the Escrow Amount and (ii) reimburse YSOF and share the Guaranty Obligations, in each case in accordance and commensurate with their Member Percentages.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Contributors hereby agree as follows:

 

Section 1.  CFT Contribution Obligations.  In the event that CFT makes a payment in respect of Indemnification Obligations in excess of the Escrow Amount and either Contributor (the “Paying Contributor”) at any time pays to CFT amounts in excess of its respective Member Percentage of such Indemnification Obligation, then the Contributor that has not paid CFT for the Indemnification Obligation (or has paid Indemnification Obligations less than its Member Percentage (the “Owing Contributor”)) agrees to indemnify the Paying Contributor as provided for herein.  The amount of any Owing Contributor’s obligation with respect to any payment made by the Paying Contributor with respect to the Indemnification Obligations shall be equal to the aggregate Indemnification Obligations paid by the Paying Contributor in excess of its applicable Member Percentage of the Indemnification Obligations.  Each Contributor’s obligations hereunder are cumulative and shall apply to each and every payment in respect of Indemnification Obligations.  Notwithstanding the foregoing, each Contributor’s obligation herein shall be limited to the amount of proceeds it receives pursuant to the transactions contemplated by the Purchase Agreement.

 

 

  

  

  

 

Section 2.  YSOF Contribution Obligations.  Should any claim under the Guaranty Agreement be properly or successfully asserted by AMFG against YSOF requiring the payment by YSOF of a Guaranty Payment, each Contributor shall contribute to YSOF its Member Percentage of such Guaranty Payment.  Payment of each Contributor’s Member Percentage of a Guaranty Payment shall be due within ten (10) days after notice by YSOF that a Guaranty Obligation is properly due, or has been paid, to AMFG, which such notice shall demand contribution by such Contributors pursuant to the terms hereof.  For purposes of this Agreement, “Guaranty Payment” shall be the amount that YSOF pays to AMFG with respect to Guaranty Obligations, including all reasonable costs and expenses (including fees of counsel) incurred by YSOF in connection with meeting its Guaranty Obligations under the Guaranty Agreement.

 

Section 3.  Collection.  If a Contributor shall fail or refuse to tender its Member Percentage of an Indemnification Obligation or Guaranty Payment, as applicable, within ten (10) days after notice from CFT (with respect to paragraph 1) and YSOF (with respect to paragraph 2), in addition to the remedies described in Section 4 below, then CFT or YSOF, as applicable, may institute legal action to recover the Member Percentage of an Indemnification Obligation or Guaranty Payment, as applicable, from such Contributor, and shall be entitled to recover all costs and expenses (including reasonable legal fees) incurred in collecting the Member Percentage of such Indemnification Obligation or Guaranty Payment, as applicable.

 

Section 4.  Events of Default; Remedies.  If any Contributor fails to make any required payment in accordance with this Agreement, such Contributor shall be in default hereunder.  In such event:

 

(a)  The defaulted payment shall bear interest during the period of the default at an annual rate equal to 10%.

 

(b)  CFT may withhold any and all sums which are distributable to such defaulting Contributor.

 

(c)  YSOF, CFT and the Paying Contributor, as applicable, may pursue such other remedies against the defaulting Contributor as may be available at law or in equity to collect the defaulted payment and interest thereon.

 

Section 5.  Further Assurances.  From time to time, as and when requested by the parties hereto, the Contributors shall collaborate and cooperate with each other, in good faith, to carry out the purposes of this Agreement consistent with the intent of this Agreement with regard to the sharing and allocation of Indemnification Obligations and the Guaranty Obligations and shall execute and deliver, or cause to be executed and delivered, such documents and instruments and shall take, or cause to be taken, such further actions as may be reasonably necessary to carry out the purposes of this Agreement.

 

 

 

 

 

 

  

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Section 6.  No Third Party Beneficiaries.  Nothing in this Agreement is intended or shall be construed to confer upon or give to any person or entity, other than the parties to this Agreement and their respective successors and assigns, any rights or remedies under or by reason of this Agreement or the provisions contained herein.

 

Section 7.  Entire Agreement.  This Agreement constitutes the entire agreement and understanding among the parties and supersedes any and all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof.

 

Section 8.  Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall constitute an original and all of which collectively shall constitute one agreement.

 

Section 9.  Captions.  The captions of the paragraphs herein are inserted for convenience of reference only and shall not be used in construing the terms and provisions hereof.

 

Section 10.     Amendments and Assignments.  This Agreement may be amended only by a written agreement executed by all of the parties to this Agreement.  Neither party may assign or delegate its rights or obligations under this Agreement without the prior written consent of the other party and any such attempted assignment is void.  This Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their respective heirs, legal representatives, successors and assigns.

 

Section 11.     Governing Law.  This Agreement and all matters arising out of or relating to this Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made and to be performed entirely within such State.

 

Section 12.     Jurisdiction; Waiver of Jury Trial.  Any action, suit or proceeding seeking to interpret or enforce any provision of, or based on, arising out of, or in any way related to, any right, obligation or matter set forth in this Agreement shall be brought in the courts located in New York State, and each of the parties consents to the jurisdiction of such courts (and the appropriate appellate courts) in any such action, suit or proceeding and waives any objection to jurisdiction and venue laid therein.  Process in any action or proceeding referred to in this preceding sentence may be served on any party anywhere in the world.  Each of the parties hereto waives any right it may have to trial by jury in respect of any litigation based on, or arising out of, under or in connection with this Agreement.

 

 

[SIGNATURE PAGE FOLLOWS]

 

 

 

 

  

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IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, have duly executed and delivered this Agreement as of the date first written above.

 

 

	 	
YORK SPECIAL OPPORTUNITIES FUND, L.P

	 	 
	 	 
	 	By: /s/ Luis Medeiros         
	 	Name: Luis Medeiros
	 	Title: Partner, Co-head Private Equity

 

 

	 	

FLOTATION INVESTOR, LLC

	 	 
	 	 
	 	By: /s/ Joshua Ratner         
	 	Name: Joshua Ratner
	 	Title: Vice President

 

 

	 	

DEEP DOWN, INC.

	 	 
	 	 
	 	By: /s/ Eugene L. Butler                                               
	 	Name: Eugene L. Butler
	 	Title: Executive Chairman & CFO

 

	 	

CUMING FLOTATION TECHNOLOGIES, LLC

	 	 
	 	 
	 	By: /s/ Glen Gordon             
	 	Name: Glen Gordon
	 	Title: President

 

 

 

Signature Page to Indemnification and Contribution AgreementAnavex Life Sciences Corp.: Exhibit 10.1 - Filed by newsfilecorp.com

- 1 -

CONSULTING AGREEMENT

     THIS CONSULTING AGREEMENT
(the “Agreement”) is made as of the 10th day of October, 2011 (the
“Effective Date”), and is by and between Anavex Life Sciences Corp., a Nevada
State Corporation (hereinafter “Company”), and George Tidmarsh of California,
USA (Hereinafter “Consultant”).

W I T N E S S E T H:

     WHEREAS the Company wishes
to engage the services of the Consultant as Executive Director to the Company.

     AND WHEREAS Consultant
wishes to perform such services among others for and on behalf of the Company
and the Company desires to obtain and apply the expertise of the Consultant to
the Business of the Company.

     NOW THEREFORE THIS AGREEMENT
WITNESSES that for good and valuable consideration (the receipt of which is
hereby acknowledged by each of the parties hereto) the parties make the
arrangements and acknowledgements hereinafter set forth:

	1. 	
      Consulting Services - The Company hereby
      retains the services of the Consultant and the Consultant hereby agrees to
      provide the consulting services to the Company to benefit the Company and
      its determination and implementation of the Company's plans for its
      Business.

	 	 
	2. 	
      Term - This Agreement is effective as of
      the Effective Date and shall remain in force, for a period of 1 (one)
      year, subject to the termination provisions contained herein. This
      Agreement may be renewed for such subsequent term and with such amendments
      as may be mutually agreed to in writing from time to time by the Company
      and the Consultant.

	 	 
	3. 	
      Termination

     3.1
Either party may at any time terminate this Agreement by providing the other
party with at least thirty (30) days written notice.

     3.2 Upon
termination of this Agreement, Consultant shall return to the Company all
material that is the property of the Company. 

     3.3 Upon
termination the Consultant shall have 30 days to exercise any options that have
already vested. After 30 days any unexercised options shall become void and of
no further effect. All non-vested options at the time of termination or death
shall become immediately void and of no further effect.

- 2 -

	4. 	Compensation - In full
      consideration of the Consultant's Services hereunder, the Company shall
      compensate the Consultant a fee as follows: 

	 	a. 	
      Pay to the Consultant a monthly fee of US$10,000 paid
      every month.

	 	b. 	
      500,000 Share purchase options subject to Schedule 1 as
      attached.

	 	c. 	
      Pay all reasonably documented expenditures that are
      incurred in the course of performing the services described herein on
      behalf of the Company.

	5. 	
      Non-Disclosure of Information -
      Consultant acknowledges that by virtue of his position he will be
      privy to Company’s confidential information and trade secrets, as they may
      exist from time to time, and that such confidential information and trade
      secrets may constitute valuable, special, and unique assets of Company
      (hereinafter collectively “Confidential Information”). Accordingly,
      Consultant shall not, during the Term and for a period of one (1) year
      thereafter, intentionally disclose all or any part of the Confidential
      Information to any person, firm, corporation, association or any other
      entity for any reason or purpose whatsoever, nor shall Consultant and any
      other person by, through or with Consultant, during the term and for a
      period of one (1) year thereafter, intentionally make use of any of the
      Confidential Information for any purpose or for the benefit of any other
      person or entity, other than Company, under any circumstances.

	 	 
	6. 	
      Insider Trading – Consultant has received
      the Insider Trading Policy of the Company and agrees to execute and abide
      by said Policy.

     IN WITNESS WHEREOF, each
of the parties hereto has executed as of the date first herein above
written.

COMPANY:

Anavex Life Sciences Corp.

	 By:	/s/ Harvey Lalach 	 
	 	Harvey Lalach 	 
	 	President 	 

CONSULTANT:

	/s/ George
      Tidmarsh 	 
	George Tidmarsh 	 

- 3 -

SCHEDULE 1

STOCK OPTION AGREEMENT

     This Stock Option Agreement is
made as of October 11, 2011 by and between Anavex Life Sciences Corp. (the
“Corporation”), and George Tidmarsh (the “Optionee”).

RECITALS

     A. The Corporation and the
Optionee have entered into a Consulting Agreement dated as of October 10, 2011
(the “Consulting Agreement”) that provides for the grant of stock options to the
Optionee to purchase shares of the Corporation’s common stock (the “Shares”).
The stock options granted herein are being granted pursuant to the Consulting
Agreement. 

NOW THEREFORE, specifically incorporating these recitals
herein, it is agreed as follows: 

AGREEMENT

GRANT OF OPTIONS

NUMBER OF SHARES. Subject to the terms and conditions of
this Agreement and the Consulting Agreement, the Corporation grants to Optionee,
Options to purchase from the Corporation five thousand (500,000) shares (the
“Option Shares”).

     EXERCISE PRICE. Each Option
Share is exercisable at a price of US $1.50 per share (the “Option
Price”).

     TERM. The Expiration Date for all
Options shall be October 10, 2016.

     VESTING. The Options granted
herein vest in accordance with the terms set out below:

     125,000 options to vest October 10,
2012
     10,417 options to vest at the end of
every month starting October, 2012 through September,
2015.
     10,405 options to vest October 10,
2015

     CONDITIONS OF OPTION. The
Options may be exercised immediately upon vesting, subject to the terms and
conditions as set forth in this Agreement and the Consulting Agreement.

- 4 -

EXERCISE OF OPTION

     DATE EXERCISABLE. The Options
shall become exercisable by Optionee in accordance with the vesting terms as
above.

     MANNER OF EXERCISE OF OPTIONS
AND PAYMENT FOR COMMON STOCK. The Options may be exercised by the Optionee, in
whole or in part, by giving written notice to the Secretary of the Corporation,
setting forth the number of Shares with respect to which Options are being
exercised. The purchase price of the Option Shares upon exercise of the Options
by the Optionee shall be paid in full in cash.

     STOCK CERTIFICATES. Promptly
after any exercise in whole or in part of the Options by Optionee, the
Corporation shall deliver to Optionee a certificate or certificates for the
number of Shares with respect to which the Options were so exercised, registered
in Optionee name.

     NON-TRANSFERABILITY. The Options
are not transferable by Optionee.

     NO RIGHTS AS SHAREHOLDER PRIOR
TO EXERCISE. Optionee shall not be deemed for any purpose to be a shareholder of
Corporation with respect to any shares subject to the Options under this
Agreement to which the Options shall not have been exercised.

     ADJUSTMENTS. The existence of
the Options shall not affect in any way the right or power of the Corporation or
its shareholders to make or authorize any adjustments, recapitalization,
reorganization, or other changes in the Corporation’s capital structure or its
business, or any merger or consolidation of the Corporation, or any issue of
bonds, debentures, preferred or preference stocks ahead of or affecting the
Option Shares, or the dissolution or liquidation of the Corporation, or any sale
or transfer of all or any part of its assets or business, or any other corporate
act or proceeding, whether of a similar character or otherwise.

     ADJUSTMENT TO OPTION SHARES.
The Option Shares are subject to adjustment upon recapitalization,
reclassification, consolidation, merger, reorganization, stock dividend, reverse
or forward stock split and the like. If the Corporation shall be reorganized,
consolidated or merged with another corporation, Optionee shall be entitled to
receive upon the exercise of the Option the same number and kind of shares of
stock or the same amount of property, cash or securities as Optionee would have
been entitled to receive upon the happening of any such corporate event as if
Optionee had been, immediately prior to such event, the holder of the number of
Shares covered by the Option.

- 5 -

IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.

Anavex Life Sciences Corp.

	 	 
	Name: Harvey Lalach 	 
	Title: President 	 

The undersigned Optionee hereby acknowledges receipt of this
Stock Option Agreement, accepts the Options granted there under, and agrees to
the terms and conditions thereof and the related Consultant Agreement.

OPTIONEE

	 	 
	George Tidmarsh 	 

- 6 -

Anavex Life Sciences Corp.

NOTICE OF EXERCISE OF STOCK OPTION

The undersigned hereby exercises the Stock Options granted by
Anavex Life Sciences Corp. and seeks to purchase ____________________ shares of
Common Stock of the Corporation pursuant to said Options. The undersigned
understands that this exercise is subject to all the terms and provisions of the
Stock Option Agreement dated as of October 10, 2011 and of the Consulting
Agreement referred to therein.

Enclosed is a check in the sum of US $ _____________________ in
payment for such shares.

	 	 
	Signature of Optionee 	 

 

	Date: 	 	 

 

 

	By: 		 
	 	George Tidmarsh

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