Document:

EXHIBIT
10.1

 

LOAN
AND EXCHANGE AGREEMENT

 

THIS
LOAN AND EXCHANGE AGREEMENT (the “Agreement”), dated as of May 3, 2021, is made by and between Alset EHome International
Inc., a Delaware corporation (“Company”), and the holder of shares of common stock, $.001 par value per share of the Company
(the “Common Stock”), signatory hereto (each a “Holder”).

 

WHEREAS,
the Holder is willing to loan his shares of Common Stock by exchanging such number of shares of Common Stock as set forth on Schedule
A (the “Exchange Securities”);

 

WHEREAS,
the Company has authorized a new series of convertible preferred stock of the Company designated as Series A Convertible Preferred Stock,
$0.001 par value, the terms of which are set forth in the Certificate of Designation of Preferences, Rights and Limitations of Series
A Convertible Preferred Stock (the “Certificate of Designations”) in the form attached hereto as Exhibit A (together
with any convertible preferred shares issued in replacement thereof in accordance with the terms thereof, the “Preferred Stock”),
which Preferred Stock shall be convertible into the Company’s Common Stock, in accordance with the terms of the Certificate of
Designations;

 

WHEREAS,
subject to the terms and conditions set forth in this Agreement and pursuant to Section 3(a)(9) of the Securities Act of 1933, as amended
(the “Securities Act”), the Company desires to exchange with the Holder, and the Holder desires to exchange with the Company,
the Exchange Securities for shares of the Company’s Preferred Stock.

 

NOW,
THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration the receipt
and adequacy of which are hereby acknowledged, the Company and Holder agree as follows:

 

1.
Terms of the Exchange. The Company and Holder agree that the Holder
will exchange the Exchange Securities and will relinquish any and all other rights he may have under the Exchange Securities in exchange
for such number of shares of Preferred Stock (the “Preferred Shares”, and such Preferred Shares as converted into Common
Stock, the “Conversion Shares”, and together with the Common Shares and the Preferred Shares, the “Securities”)
as set forth on Schedule A, annexed hereto.

 

2.
Closing. Upon satisfaction of the conditions set forth herein, a closing shall occur at the principal offices of the Company,
or such other location as the parties shall mutually agree. At closing, Holder shall deliver the Exchange Securities to the Company pursuant
to this Agreement and the Company shall deliver to such Holder a certificate evidencing the Preferred Shares, in the name(s) and amount(s)
as indicated on Schedule A annexed hereto. Upon closing the Exchange Securities shall be cancelled and Holder will have no remaining
rights, powers, privileges, remedies or interests under the Exchange Securities.

 

3.
Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and
shall execute and deliver all such other agreements, certificates, instruments and documents, as any other party may reasonably request
in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated
hereby.

 

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4.
Representations and Warranties of the Holder. The Holder represents and warrants as of the date hereof and as of the closing to
the Company as follows:

 

a.
Authorization; Enforcement. The Holder has the requisite power and authority to enter into and to consummate the transactions
contemplated by this Agreement and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this
Agreement by the Holder and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all
necessary action on the part of the Holder and no further action is required by the Holder. This Agreement has been (or upon delivery
will have been) duly executed by the Holder and, when delivered in accordance with the terms hereof, will constitute the valid and binding
obligation of the Holder enforceable against the Holder in accordance with its terms, except: (i) as limited by general equitable principles
and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’
rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

 

b.
Information Regarding Holder. Holder is an “accredited investor”, as such term is defined in Rule 501 of Regulation
D promulgated by the United States Securities and Exchange Commission (the “Commission”) under the Securities Act, is experienced
in investments and business matters, has made investments of a speculative nature and has purchased securities of companies in private
placements in the past and, with its representatives, has such knowledge and experience in financial, tax and other business matters
as to enable the Holder to utilize the information made available by the Company to evaluate the merits and risks of and to make an informed
investment decision with respect to the proposed purchase, which represents a speculative investment. Holder has the authority and is
duly and legally qualified to purchase and own the Securities. Holder is able to bear the risk of such investment for an indefinite period
and to afford a complete loss thereof.

 

c.
Legend. The Holder understands that the Securities have been issued (or will be issued in the case of the Conversion Shares)
pursuant to an exemption from registration or qualification under the Securities Act and applicable state securities laws, and except
as set forth below, the Securities shall bear any legend as required by the “blue sky” laws of any state and a restrictive
legend in substantially the following form (and a stop-transfer order may be placed against transfer of such stock certificates):

 

[NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE
HAVE BEEN][THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN] REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR
APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A)
AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL TO
THE HOLDER (IF REQUESTED BY THE COMPANY), IN A FORM REASONABLY ACCEPTABLE TO THE COMPANY, THAT REGISTRATION IS NOT REQUIRED UNDER SAID
ACT OR (II) UNLESS SOLD OR ELIGIBLE TO BE SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES
MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

 

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d.
Restricted Securities. The Holder understands that: (i) the Securities have not been and are not being registered under the Securities
Act or any state securities laws, and may not be offered for sale, sold, assigned or transferred unless (A) subsequently registered thereunder,
(B) the Holder shall have delivered to the Company (if requested by the Company) an opinion of counsel to the Holder, in a form reasonably
acceptable to the Company, to the effect that such Securities to be sold, assigned or transferred may be sold, assigned or transferred
pursuant to an exemption from such registration, or (C) the Holder provides the Company with reasonable assurance that such Securities
can be sold, assigned or transferred pursuant to Rule 144 or Rule 144A promulgated under the Securities Act (or a successor rule thereto)
(collectively, “Rule 144”); (ii) any sale of the Securities made in reliance on Rule 144 may be made only in accordance with
the terms of Rule 144, and further, if Rule 144 is not applicable, any resale of the Securities under circumstances in which the seller
(or the Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the Securities Act) may
require compliance with some other exemption under the Securities Act or the rules and regulations of the SEC promulgated thereunder;
and (iii) neither the Company nor any other Person is under any obligation to register the Securities under the Securities Act or any
state securities laws or to comply with the terms and conditions of any exemption thereunder.

 

5.
Representations and Warranties of the Company. The Company hereby makes the following representations and warranties to the Holder:

 

a.
Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate
the transactions contemplated by this Agreement and each of the other agreements entered into by the parties hereto in connection with
the transactions contemplated by this Agreement (collectively, the “Exchange Documents”) and otherwise to carry out its obligations
hereunder and thereunder. The execution and delivery of this Agreement by the Company and the consummation by it of the transactions
contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is
required by the Company, the Board of Directors of the Company or the Company’s stockholders in connection therewith, including,
without limitation, the issuance of the Preferred Shares, and the reservation for issuance and issuance of Conversion Shares issuable
upon conversion of the Preferred Shares have been duly authorized by the Company’s Board of Directors and no further filing, consent,
or authorization is required by the Company, its Board of Directors or its stockholders. This Agreement and any Other Agreement (as defined
herein) have been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof,
will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except:
(i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general
application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific
performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited
by applicable law.

 

b.
Organization and Qualification. Each of the Company and its subsidiaries (the “Subsidiaries”) are entities
duly organized and validly existing and in good standing under the laws of the jurisdiction in which they are formed, and have the requisite
power and authorization to own their properties and to carry on their business as now being conducted and as presently proposed to be
conducted. Each of the Company and each of its Subsidiaries is duly qualified as a foreign entity to do business and is in good standing
in every jurisdiction in which its ownership of property or the nature of the business conducted by it makes such qualification necessary,
except to the extent that the failure to be so qualified or be in good standing would not have a Material Adverse Effect. As used in
this Agreement, “Material Adverse Effect” means any material adverse effect on (i) the business, properties, assets, liabilities,
operations (including results thereof), condition (financial or otherwise) or prospects of the Company or any Subsidiary, individually
or taken as a whole, (ii) the transactions contemplated hereby or in any of the other Exchange Documents or (iii) the authority or ability
of the Company to perform any of its obligations under any of the Exchange Documents.

 

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c. No
Conflict. The execution, delivery and performance of the Exchange Documents by the Company and the consummation by the
Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the Preferred
Shares and reservation for issuance and issuance of the Conversion Shares) will not (i) (i) result in a violation of the
Certificate of Incorporation (as defined below) or other organizational documents of the Company or any of its Subsidiaries,
any capital stock of the Company or any of its Subsidiaries or Bylaws (as defined below) of the Company or any of its
Subsidiaries, (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would
become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any
agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party, or (iii) result in a violation
of any law, rule, regulation, order, judgment or decree (including foreign, federal and state securities laws and regulations
and the rules and regulations of the Nasdaq Stock Market (the “Principal Market”) applicable to the Company or
any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected
except, in the case of clause (ii) or (iii) above, to the extent such violations that could not reasonably be expected to
have a Material Adverse Effect.

 

d.
No Consents. Neither the Company nor any Subsidiary is required to obtain any consent from, authorization or order of, or make
any filing or registration with, any court, governmental agency or any regulatory or self-regulatory agency or any other Person in order
for it to execute, deliver or perform any of its respective obligations under or contemplated by the Exchange Documents, in each case,
in accordance with the terms hereof or thereof, except as previously obtained. All consents, authorizations, orders, filings and registrations
which the Company or any Subsidiary is required to obtain pursuant to the preceding sentence have been obtained or effected on or prior
to the date of this Agreement, and neither the Company nor any of its Subsidiaries is aware of any facts or circumstances which might
prevent the Company or any of its Subsidiaries from obtaining or effecting any of the registration, application or filings contemplated
by the Exchange Documents.

 

e.
Securities Law Exemptions. Assuming the accuracy of the representations and warranties of the Holder contained herein, the offer
and issuance by the Company of the Securities is exempt from registration under the Securities Act. The offer and issuance of the Securities
is exempt from registration under the Securities Act pursuant to the exemption provided by Section 3(a)(9) thereof. The Company covenants
and represents to the Holder that neither the Company nor any of its Subsidiaries has received, anticipates receiving, has any agreement
to receive or has been given any promise to receive any consideration from the Holder or any other Person in connection with the transactions
contemplated by the Exchange Documents.

 

f.
Issuance of Securities. The issuance of the Preferred Shares are duly authorized and upon issuance in accordance with the terms
of the Exchange Documents shall be validly issued, fully paid and non-assessable and free from all taxes, liens, charges and other encumbrances
with respect to the issue thereof. Upon issuance or conversion in accordance with the Certificate of Designations, the Conversion Shares,
when issued, will be validly issued, fully paid and nonassessable and free from all preemptive or similar rights, taxes, liens, charges
and other encumbrances with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of Common
Stock.

 

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6.
Miscellaneous.

 

a.
Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective
successors and assigns.

 

b.
Governing Law. This Agreement shall be governed by and construed under the laws of the State of Delaware without regard
to the choice of law principles thereof.

 

c.
Severability. If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability
shall not affect the validity or enforceability of the remainder of this Agreement in that jurisdiction or the validity or enforceability
of any provision of this Agreement in any other jurisdiction.

 

d.
Counterparts/Execution. This Agreement may be executed in two or more identical counterparts, all of which shall be considered
one and the same agreement and shall become effective when counterparts have been signed by each party and delivered to the other party.
In the event that any signature is delivered by facsimile transmission or by an e-mail which contains an electronic file of an executed
signature page, such signature page shall create a valid and binding obligation of the party executing (or on whose behalf such signature
is executed) with the same force and effect as if such facsimile or electronic file signature page (as the case may be) were an original
thereof.

 

e.
Entire Agreement; Amendments. This Agreement constitutes the entire agreement between the parties with regard to the subject
matter hereof and thereof, superseding all prior agreements or understandings, whether written or oral, between or among the parties.
This Agreement may be amended, modified, superseded, cancelled, renewed or extended, and the terms and conditions hereof may be waived,
only by a written instrument signed by all parties, or, in the case of a waiver, by the party waiving compliance. Except as expressly
stated herein, no delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof,
nor shall any waiver on the part of any party of any right, power or privilege hereunder preclude any other or future exercise of any
other right, power or privilege hereunder.

 

f.
Headings. The headings used in this Agreement are used for convenience only and are not to be considered in construing or interpreting
this Agreement.

 

(Signature
Pages Follow)

 

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IN
WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the day and year first above written.

 

	ALSET EHOME INTERNATIONAL INC.	 
	 	 	 
	By:	/s/
    Chan Heng Fai	 
	Name:	Chan
    Heng Fai 	 
	Title:	Chief
    Executive Officer 	 

 

	HOLDER:	 	 
	 	 	 
	/s/
    Chan Heng Fai	 Chan
    Heng Fai	 

 

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SCHEDULE
A

 

	 

    Name
    of Holder
	 	Number
    of Shares of Common Stock to be

    Exchanged
	 	Number
    of Shares of Preferred Stock to be Issued
	Chan
    Heng Fai	 	6,380,000	 	6,380exhibit101icd2021sarawar

Sidley comments 2/16/21    INDEPENDENCE CONTRACT DRILLING, INC.  FORM OF STOCK APPRECIATION RIGHTS AGREEMENT  CASH SETTLED  1. Grant of Stock Appreciation Rights.  Pursuant to the Independence Contract Drilling, Inc.  2019 Omnibus Incentive Plan (the “Plan”), Independence Contract Drilling, Inc., a Delaware corporation  (the “Company”), hereby grants to  _______________________________  (the “Participant”)  a stock appreciation right relating to the appreciation in [_________] shares of Stock of the Company (the  “SAR”) at an exercise price (the “SAR Price”) of $[__________] per share (which is equal to or greater  than the Fair Market Value of a share of Stock as of the Date of Grant, as defined below), all upon and  subject to the terms and conditions set forth in this Agreement.   Annex A to this Agreement includes  certain defined terms used herein.  To the extent not otherwise defined in this Agreement, capitalized  terms shall have the meanings set forth in the Plan.  2. Date of Grant.  The date of grant of the SAR is [_______________, 20___] (the “Date of  Grant”).  3. Subject to Plan; Defined Terms.  The SAR and this Agreement are subject to the terms  and conditions of the Plan, and the terms of the Plan shall control to the extent not otherwise inconsistent  with the provisions of this Agreement.   Except as otherwise provided herein, the capitalized terms used  herein that are defined in the Plan shall have the same meanings assigned to them in the Plan.  The SAR is  subject to any rules promulgated pursuant to the Plan by the Board or the Committee and communicated  to the Participant in writing.  4.  Vesting; Time of Exercise.    (a) Time Vesting.  The Participant shall become vested in installments of the SAR  awarded to the Participant and such SAR shall become fully exercisable in accordance with the  following schedule:  (i) One-third (1/3) of shares of Stock subject to the SAR (rounding down, if  applicable, to the nearest whole share of Stock) shall vest and become  exercisable on the first anniversary of the Date of Grant, provided the  Participant is employed by the Company or a Subsidiary on that date;  (ii) An additional one-third (1/3) of shares of Stock subject to the SAR  (rounding down, if applicable, to the nearest whole share of Stock) shall  vest and become exercisable on the second anniversary of the Date of  Grant, provided the Participant is employed by the Company or a  Subsidiary on that date; and  (iii) The remaining one-third (1/3) of the shares of Stock (rounding up for and  including if applicable, any fractional shares previously excluded in  clauses (i) and (ii) above, and any other fractions, to achieve a whole  share of Stock) subject to the SAR shall vest and become exercisable on  

 

 2    the third anniversary of the Date of Grant, provided the Participant is  employed by the Company or a Subsidiary on that date.  Each of the periods described in Section 4(a), (b), and (c) above is a “Vesting Year.”    (b) [Termination of Employment without Cause or for Good Reason.  If Separation  of Service occurs by the Company without Cause or by the Participant for Good Reason, the SAR  shall immediately vest in full upon such Separation of Service.]1    5. Term; Forfeiture.  Except as otherwise provided in this Agreement, any unexercised  portion of the SAR that is unvested on the date of the Participant’s Separation of Service shall terminate  on that date.  Any unexercised portion of the SAR that is vested shall terminate on the first to occur of the  following:  (a) 5 p.m. on __________, 20[__]  (the period of time extending from the date of this  Agreement to such date being referred to herein as the “SAR Period”);  (b) 5 p.m. on the date of Separation of Service, unless [such Separation of Service is  by the Company without Cause or by the Participant for Good Reason, or]2 such Separation of  Service occurs on or following the occurrence of a Change of Control; and  (c) 5 p.m. on the date that is three years following Separation of Service, if [such  Separation of Service is by the Company without Cause or by the Participant for Good Reason, or  ]3 such Separation of Service occurs on or following the occurrence of a Change of Control.  6. Exercise and Payment.  The Participant may exercise the vested portion of the SAR at  any time prior to the termination of the SAR in accordance with Section 5 above by the delivery of  written notice to the Company setting forth the number of shares of Stock under the SAR which are to be  exercised, the date of exercise thereof (the “Exercise Date”) and the address to which payment shall be  delivered.  Within 5 business days, the Company shall make a cash payment to the Participant in an  amount equal to the excess (if any) of (i) the Average Fair Market Value as of the Exercise Date of a  share of Common Stock over (ii) the SAR Price of a share specified in this Agreement, multiplied by the  total number of shares of Stock under the SAR being exercised[; provided, however, that for purposes of  the foregoing, the Average Fair Market Value shall in no event exceed $[____] per share (subject to  adjustment for stock dividends, stock splits and other recapitalization events in accordance with Section  4.5 of the Plan)].  Notwithstanding the foregoing, if payment of such amount (when aggregated with any  other payments related to stock appreciation rights exercised under the Plan), would jeopardize the ability  of the Company to continue as a going concern, the Company may delay a portion of such payment until  such time at which making such payment and any other payments owed in respect of other stock  appreciation rights exercised by other Plan participants would no longer have such effect.  7. No Fractional Shares.  The SAR may be exercised only with respect to full shares.    1 [Applicable only to employees with employment agreements].    2 [Applicable only to employees with employment agreements] (Same as provided for in Section 4(b)).  3 [Applicable only to employees with employment agreements] (Same as provided for in Section 4(b)).  

 

 3    8. Who May Exercise.  Subject to the terms and conditions set forth in Sections 4 and 5  above, during the lifetime of the Participant, the SAR may only be exercised by the Participant or his  guardian or legal representative.  If the Participant dies prior to the dates specified in Section 5 above  without having exercised all of the portion of his or her then-vested SAR as of his or her date of death,  then the following persons may exercise the exercisable portion of the SAR on behalf of the Participant at  any time prior to the earliest of the dates specified in Section 5 hereof: the personal representative of his  or her estate or any person who acquired the right to exercise the SAR by bequest or inheritance or by  reason of the death of the Participant; provided that the SAR shall remain subject to the other terms of this  Agreement, the Plan and all applicable laws, rules, and regulations.  9. Non-Assignability.  The SAR granted under this Agreement, and any interest in or right  associated with such SAR, are not assignable or transferable by the Participant except by will or by the  laws of descent and distribution.  10. Representations, Etc.  Each spouse individually is bound by, and such spouse’s interest, if  any, in any SAR is subject to, the terms of this Agreement.  Nothing in this Agreement shall create a  community property interest where none otherwise exists.  11. Simultaneous Death.  If the Participant and his or her spouse both suffer a common  accident or casualty which results in their respective deaths within 60 days of each other, it shall be  conclusively presumed, for the purpose of this Agreement, that the Participant died first and the spouse  died thereafter.  12. Specific Performance. The parties acknowledge that remedies at law will be inadequate  remedies for breach of this Agreement and consequently agree that this Agreement shall be enforceable  by specific performance.  The remedy of specific performance shall be cumulative of all of the rights and  remedies at law or in equity of the parties under this Agreement.  13. No Rights as Shareholder.  The Participant will have no rights as a shareholder of the  Company with respect to the SAR.  14. Adjustment of Number of Shares and Related Matters.  The number of shares of  Common Stock covered by the SAR, and the SAR Price thereof, shall be subject to adjustment in  accordance with the Plan and Section 22 below.  15. Participant’s Acknowledgments.  The Participant acknowledges receipt of a copy of the  Plan, which is annexed hereto, and represents that he or she is familiar with the terms and provisions  thereof, and hereby accepts the SAR subject to all the terms and provisions thereof.  The Participant  hereby agrees to accept as binding, conclusive, and final all decisions or interpretations of the Committee  or the Board, as appropriate, upon any questions arising under the Plan or this Agreement.  16. Law Governing.  This Agreement shall be governed by, construed, and enforced in  accordance with the laws of the State of Texas (excluding any conflict of laws rule or principle of Texas  law that might refer the governance, construction, or interpretation of this agreement to the laws of  another state).  17. No Right to Continue Service or Employment.  Nothing herein shall be construed to  confer upon the Participant the right to continue in the employ or to provide services to the Company or  any Subsidiary, whether as an Employee or as a consultant or as an outside director, or interfere with or  restrict in any way the right of the Company or any Subsidiary to discharge the Participant as an  Employee, consultant or outside director at any time.  

 

 4    18. Legal Construction.  In the event that any one or more of the terms, provisions, or  agreements that are contained in this Agreement shall be held by a court of competent jurisdiction to be  invalid, illegal, or unenforceable in any respect for any reason, the invalid, illegal, or unenforceable term,  provision, or agreement shall not affect any other term, provision, or agreement that is contained in this  Agreement and this Agreement shall be construed in all respects as if the invalid, illegal, or unenforceable  term, provision, or agreement had never been contained herein.  19. Covenants and Agreements as Independent Agreements.  Each of the covenants and  agreements that is set forth in this Agreement shall be construed as a covenant and agreement independent  of any other provision of this Agreement.  The existence of any claim or cause of action of the Participant  against the Company, whether predicated on this Agreement or otherwise, shall not constitute a defense to  the enforcement by the Company of the covenants and agreements that are set forth in this Agreement.  20. Entire Agreement.  This Agreement together with the Plan supersede any and all other  prior understandings and agreements, either oral or in writing, between the parties with respect to the  subject matter hereof and constitute the sole and only agreements between the parties with respect to the  said subject matter.  All prior negotiations and agreements between the parties with respect to the subject  matter hereof are merged into this Agreement.  Each party to this Agreement acknowledges that no  representations, inducements, promises, or agreements, orally or otherwise, have been made by any party  or by anyone acting on behalf of any party, which are not embodied in this Agreement or the Plan and  that any agreement, statement or promise that is not contained in this Agreement or the Plan shall not be  valid or binding or of any force or effect.  21. Parties Bound.  The terms, provisions, and agreements that are contained in this  Agreement shall apply to, be binding upon, and inure to the benefit of the parties and their respective  heirs, executors, administrators, legal representatives, and permitted successors and assigns, subject to the  limitation on assignment expressly set forth herein.  22. Modification.  No change or modification of this Agreement shall be valid or binding  upon the parties unless the change or modification is in writing and signed by the parties; provided,  however, that the Company may change or modify the terms of this Agreement, including, without  limitation, the SAR Price, without the Participant’s consent or signature if the Company determines, in its  sole discretion, that such change or modification is necessary for purposes of compliance with or  exemption from the requirements of Section 409A of the Code or any regulations or other guidance issued  thereunder.  Notwithstanding the preceding sentence, the Company may amend the Plan or revoke the  SAR to the extent permitted by the Plan.  23. Headings.  The headings that are used in this Agreement are used for reference and  convenience purposes only and do not constitute substantive matters to be considered in construing the  terms and provisions of this Agreement.  24. Gender and Number.  Words of any gender used in this Agreement shall be held and  construed to include any other gender, and words in the singular number shall be held to include the  plural, and vice versa, unless the context requires otherwise.  25. Notice.  Any notice required or permitted to be delivered hereunder shall be deemed to be  delivered only when actually received by the Company or by the Participant, as the case may be, at the  addresses set forth below, or at such other addresses as they have theretofore specified by written notice  delivered in accordance herewith:  (a) Notice to the Company shall be addressed and delivered as follows:  

 

 5    Independence Contract Drilling, Inc.  20549 Hwy 249, Suite 300  Houston, Texas  77070  Attn:  President & Chief Executive Officer    With a  copy to:  Executive Vice President & Chief Financial Officer    Notice to the Participant shall be addressed and delivered as set forth on the  signature page or if no address is provided,  the address on file with the  Company’s Human Resource Department.  26. Tax Requirements.  The Participant is hereby advised to consult immediately with his or  her own tax advisor regarding the tax consequences of this Agreement.  The Company or, if applicable,  any Subsidiary (for purposes of this Section 26, the term “Company” shall be deemed to include any  applicable Subsidiary), shall have the right to withhold from any payment to the Participant the amount of  any taxes that the Company is required to withhold in connection with the Participant’s income arising  with respect to this Award.    27. Forfeiture and Clawback.  The SARs granted and any related payments made by the  Company hereunder upon the exercise of any SAR are subject to all forfeiture and clawback provisions  contained in the Plan, as well as any clawback policies in place and approved by the Company’s Board of  Directors or Compensation Committee on the Date of Grant.  28. Restrictive Covenants.  As a condition to the award of the SARs hereunder,  Participant agrees to the restrictive covenants contained in Annex B hereto.  IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly  authorized officer, and the Participant, to evidence his or her consent and approval of all the terms hereof,  has duly executed this Agreement, as of the ____ day of _________________, 20___.    INDEPENDENCE CONTRACT DRILLING, INC.  By:       PARTICIPANT  By:     Participant’s Address for Notices:        

 

 6    ANNEX A  DEFINED TERMS    “Average Fair Market Value” shall mean the average closing price on the NYSE for the last 20 NYSE  trading days prior to and including the Exercise Date, in each case as applied to the applicable equity  security.  To the extent a security of the Company is not listed or traded on the NYSE, “NYSE” as used  herein shall mean the principal national securities exchange or quotation service on which the security is  listed or quoted.     “Cause” shall mean Participant’s:  (i) willful and continued failure to comply with the reasonable written directives of the  Company for a period of thirty (30) days after written notice from the Company;    (ii) willful and persistent inattention to duties for a period of thirty (30) days after written notice  from the Company, or the commission of acts within employment with the Company  amounting to gross negligence or willful misconduct;  (iii) misappropriation of funds or property of the Company or committing any fraud against the  Company or against any other person or entity in the course of employment with the  Company;  (iv) misappropriation of any corporate opportunity, or otherwise obtaining personal profit from  any transaction which is adverse to the interests of the Company or to the benefits of which  the Company is entitled;  (v) conviction of a felony involving moral turpitude;   (vi) willful failure to comply in any material respect with the terms of this Agreement and such  non-compliance continues uncured after thirty (30) days after written notice from the  Company; or  (vii) chronic substance abuse, including abuse of alcohol, drugs or other substances or use of  illegal narcotics or substances, for which Participant fails to undertake treatment  immediately after requested by the Company or to complete such treatment and which  abuse continues or resumes after such treatment period, or possession of illegal narcotics  or substances on Company premises or while performing Participant’s duties and  responsibilities.  For purposes of this definition, no act, or failure to act, by Participant will be considered “willful”  if done, or omitted to be done, by Participant in good faith and in the reasonable belief that the act  or omission was in the best interest of the Company or required by applicable law.   Any  termination by the Company for Cause shall be communicated by Notice of Termination to the  other party.  For purposes of this Agreement, a “Notice of Termination” means a written notice  which (i) indicates the specific termination provision in this Agreement relied upon, (ii) to the  extent applicable, sets forth in reasonable detail the facts and circumstances claimed to provide a  basis for termination of the Participant's employment under the provision so indicated and (iii) if  the Date of Termination (as defined below) is other than the date of receipt of such notice,  

 

 7    specifies the termination date (which date shall be not more than 30 days after the giving of such  notice). The failure by the Company to set forth in the Notice of Termination any fact or  circumstance which contributes to a showing of Cause shall not waive any right of the Company  from asserting such fact or circumstance in enforcing the Participant's or the Company's rights  hereunder.  “Date of Termination” shall mean the date that employment with the Company and its  affiliates is terminated in all respects for any reason.  “Change of Control” shall mean:   (i) The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3)  or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a  “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under  the Exchange Act) of 50 percent or more of either (A) the then-outstanding shares of  common stock or membership interests of the Company (the “Outstanding Company  Common Stock”) or (B) the combined voting power of the then outstanding voting  securities of the Company entitled to vote generally in the election of directors or managers  (the “Outstanding Company Voting Securities”); provided, however, that for purposes of  this subsection A, the following acquisitions shall not constitute a Change of Control:  (1)  any acquisition directly from the Company or any acquisition by the Company; or (2) any  acquisition by any employee benefit plan (or related trust) sponsored or maintained by the  Company or any corporation controlled by the Company; or (3) any acquisition by any  corporation pursuant to a transaction that complies with clauses (1), (2) and (3) of  subsection C of this definition; or  (ii)  Individuals, who, as of the date hereof or at the time of consummation of the transactions  contemplated by the Contribution Agreement, constitute the Board (the “Incumbent  Board”) cease for any reason to constitute at least a majority of the Board; provided,  however, (1) that any individual becoming a director subsequent to the date hereof whose  election by the Company's stockholders or members was approved by a vote of the  stockholders or members described in Section 3 of the Registration Rights Agreement  attached as Exhibit F to the Contribution Agreement shall be considered as though such  individual was a member of the Incumbent Board, and (2) that any individual becoming a  director subsequent to the date hereof whose election, or nomination for election by the  Company's stockholders or members, was approved by a vote of at least a majority of the  directors then comprising the Incumbent Board shall be considered as though such  individual was a member of the Incumbent Board, but excluding, for purpose of this  paragraph (ii), any such individual whose initial assumption of office occurs as a result of  an actual or threatened election contest with respect to the election or removal of directors  or other actual or threatened solicitation of proxies or consents by or on behalf of a Person  other than the Board; or  (iii) Consummation of a reorganization, merger or consolidation or sale or other disposition of  all or substantially all of the assets of the Company (a “Corporate Transaction”) in each  case, unless, following such Corporate Transaction, (1) all or substantially all of the  individuals and entities who were the beneficial owners, respectively, of the Outstanding  Company Common Stock and Outstanding Company Voting Securities immediately prior  to such Corporate Transaction beneficially own, directly or indirectly, more than 60 percent  of, respectively, the then outstanding shares of common stock and the combined voting  power of the then outstanding voting securities entitled to vote generally in the election of  directors, as the case may be, of the corporation resulting from such Corporate Transaction  (including, without limitation, a corporation that as a result of such transaction owns the  

 

 8    Company or all or substantially all of the Company's assets either directly or through one  or more subsidiaries) in substantially the same proportions as their ownership, immediately  prior to such Corporate Transaction, of the Outstanding Company Common Stock and the  Outstanding Company Voting Securities, as the case may be, (2) no Person (excluding any  corporation resulting from such Corporate Transaction or any employee benefit plan (or  related trust) of the Company or such corporation resulting from such Corporate  Transaction) beneficially owns, directly or indirectly, 20 percent or more of, respectively,  the then outstanding shares of common stock of the corporation resulting from such  Corporate Transaction or the combined voting power of the then outstanding voting  securities of such corporation except to the extent that such ownership existed prior to the  Corporate Transaction and (3) at least a majority of the members of the board of directors  of the corporation resulting from such Corporate Transaction were members of the  Incumbent Board at the time of the execution of the initial agreement, or of the action of  the Board, providing for such Corporate Transaction; or  (iv) Approval by the stockholders of the Company of a complete liquidation or dissolution of  the Company.  “Good Reason” shall mean without the express written consent of Participant, the occurrence of any of the  following:  (v) any action or inaction that constitutes a material breach by the Company of this Agreement  and such action or inaction continues uncured after thirty (30) days following written notice  from the Participant;   (vi) the assignment to the Participant of any duties inconsistent in any respect with the  Participant's position (including status, offices, titles and reporting requirements),  authority, duties or responsibilities as contemplated by Section 3(a) of this Agreement, or  any other action by the Company which results in a diminution in such position, authority,  duties or responsibilities, excluding for this purpose an isolated, insubstantial and  inadvertent action not taken in bad faith and which is remedied by the Company within 30  days of  receipt of written notice thereof given by the Participant;  (vii) any failure by the Company to comply with the provisions of Section 4 of this Agreement,  other than an isolated, insubstantial and inadvertent failure not occurring in bad faith and  which is remedied by the Company as soon as reasonable possible, but no later than 30  days after receipt of written notice thereof given by the Participant;  (viii) a change in the geographic location at which Participant must perform services to a location  more than fifty (50) miles from Houston, Texas or the location at which Participant  normally performs such services as of the Effective Date; or  (ix) in the event a Change of Control has occurred, the assignment to the Participant to any  position (including status, offices, titles and reporting requirements), authority, duties or  responsibilities that are not (A) as a senior Participant officer with the ultimate parent  company of the entity surviving or resulting from such Change of Control and (B)  substantially identical to the Participant's position (including status, offices, titles and  reporting requirements), authority, duties and responsibilities as contemplated by this  Agreement.  

 

 9    The Participant’s termination of employment shall not constitute Good Reason unless Participant  notifies the Company of the condition or event constituting Good Reason within ninety days  (90) days of the condition’s occurrence (unless unknown to Participant) and the Company fails to  cure the conditions, to the extent curable, specified in the notice within thirty (30) days following  such notification. Any termination during the Employment Term by the Participant for Good  Reason shall be communicated by Notice of Termination to the other party hereto.       

 

 10    ANNEX B  Restrictive Covenants  1. Restrictive Covenants.  In consideration for the SARs granted under this Agreement,  which are expected to vest during Participant’s employment with the Company Group, as well as the  protection of the Company Group’s goodwill and Confidential Information, Participant agrees to the  following:  (a) Nondisclosure of Confidential Information.  Participant shall hold in a fiduciary  capacity for the benefit of the Company Group all Confidential Information which shall have  been obtained by Participant during Participant’s employment and shall not use such Confidential  Information other than within the scope of Participant’s employment with and for the exclusive  benefit of the Company Group.  Following any termination of employment with the Company  Group, Participant agrees (i) not to communicate, divulge or make available to any person or  entity (other than the Company Group) any such Confidential Information, except (A) upon the  prior written authorization of the Company Group, (B) as may be required by law or legal  process, (C) as reasonably necessary in connection with the enforcement of any right or remedy  related to this Agreement, or (D) unless no longer Confidential Information, and (ii) to deliver  promptly to the Company Group any Confidential Information in Participant’s possession,  including any duplicates thereof and any notes or other records Participant has prepared with  respect thereto. In the event that the provisions of any applicable law or the order of any court  would require Participant to disclose or otherwise make available any Confidential Information  then Participant shall, to the extent practicable, give the Company prior written notice of such  required disclosure and an opportunity to contest the requirement of such disclosure or apply for a  protective order with respect to such Confidential Information by appropriate proceedings.      (b) Limited Covenant Not to Compete.  In the event Participant’s employment is  terminated for any reason, Participant agrees that during the period beginning on the date of such  termination and ending on the twelve (12) month anniversary of the date of such termination:  (i) Participant shall not, directly or indirectly, for himself or others, own,  manage, operate, control or participate in the ownership, management,  operation or control of any business, whether in corporate, proprietorship  or partnership form or otherwise, that is engaged, directly or indirectly,  in the United States in the Restricted Business; provided, however, that  the restrictions contained herein shall not restrict (A) the acquisition by  Participant of less than 2% of the outstanding capital stock of any  publicly traded company engaged in a Restricted Business or (B)  Participant from being employed by an entity in which the majority of  such entity’s revenues on a consolidated basis determined in accordance  with generally accepted accounting principles are from activities and  businesses that do not constitute a Restricted Business and provided that  Participant is only employed by and engaged with divisions and units of  such entity that are not engaged in the Restricted Business; and  (ii) Participant shall not, directly or indirectly (A) solicit any individual,  who, at the time of time of such solicitation is an employee of the  Company Group, to leave such employment or hire, employ or otherwise  engage any such individual (other than employees of the Company  Group who respond to general advertisements for employment in  

 

11  newspapers or other periodicals of general circulation (including trade  journals)), or (B) cause, induce or encourage any material actual or  prospective client, customer, supplier, landlord, lessor or licensor of the  Company Group to terminate or modify any such actual or prospective  contractual relationship that exists on the date of termination of  employment.  (c) Injunctive Relief; Remedies.  The covenants and undertakings contained in this Annex B relate to matters which are of a special, unique and extraordinary character and a  violation of any of the terms of this Annex B will cause irreparable injury to the Company Group,  the amount of which will be impossible to estimate or determine and which cannot be adequately  compensated.  Accordingly, the remedy at law for any breach of this Annex B may be inadequate.   Therefore, notwithstanding anything to the contrary, the Company will be entitled to an  injunction, restraining order or other equitable relief from any court of competent jurisdiction in  the event of any breach of any provision of this Annex B without the necessity of proving actual  damages or posting any bond whatsoever.  The rights and remedies provided by this Annex B are  cumulative and in addition to any other rights and remedies which the Company Group may have  hereunder or at law or in equity.  The parties hereto further agree that, if any court of competent  jurisdiction in a final nonappealable judgment determines that a time period, a specified business  limitation or any other relevant feature of this Annex B is unreasonable, arbitrary or against  public policy, then a lesser time period, geographical area, business limitation or other relevant  feature which is determined by such court to be reasonable, not arbitrary and not against public  policy may be enforced against the applicable party.  (d) Governing Law of this Annex B; Consent to Jurisdiction. Any dispute regarding the reasonableness of the covenants and agreements set forth in this Annex B, or the territorial  scope or duration thereof, or the remedies available to the Company upon any breach of such  covenants and agreements, shall be governed by and interpreted in accordance with the laws of  the state of Texas, without regard to conflict of law provisions thereof, and, with respect to each  such dispute, the Company and Participant each hereby irrevocably consent to the exclusive  jurisdiction of the State of Texas for resolution of such dispute, and further agree that service of  process may be made upon Participant in any legal proceeding relating to this Annex B by any  means allowed under the laws of such state.   (e) Participant’s Understanding of this Section.  Participant hereby represents to the Company that Participant has read and understands, and agrees to be bound by, the terms of this  Annex B. Participant acknowledges that the geographic scope and duration of the covenants  contained in this Annex B are the result of arm’s-length bargaining and are fair and reasonable in  light of (i) the importance of the functions performed by Participant and the length of time it  would take the Company Group to find and train a suitable replacement, (ii) the nature and wide  geographic scope of the operations of the Company Group, (iii) Participant’s level of control over  and contact with the Company Group’s business and operations in all jurisdictions where they are  located, and (iv) the fact that the Restricted Business is potentially conducted throughout the  geographic area where competition is restricted by this Agreement. It is the desire and intent of  the parties that the provisions of this Agreement be enforced to the fullest extent permitted under  applicable law, whether now or hereafter in effect and therefore, to the extent permitted by  applicable law, the parties hereto waive any provision of applicable law that would render any  provision of this Annex B invalid or unenforceable.

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