Exhibit 10.34

 

TRUST AGREEMENT

 

Between

 

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GLOBALSANTAFE CORPORATE SERVICES INC.

 

And

 

FIDELITY MANAGEMENT TRUST COMPANY

 

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GLOBALSANTAFE KEY EMPLOYEE DEFERRED COMPENSATION

 

TRUST

 

Dated as of July 12, 2002

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TABLE OF CONTENTS

 

Section

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   Page

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1   

Definitions

   2 2   

Trust

   3     

(a) Establishment

   3     

(b) Grantor Trust

   3     

(c) Trust Assets

   3     

(d) Non-Assignment

   3 3   

Payments to Sponsor

   4 4   

Disbursement

   4     

(a) Directions from Administrator

   4     

(b) Limitations

   4 5   

Investment of Trust

   4     

(a) Selection of Investment Options

   4     

(b) Available Investment Options

   4     

(c) Investment Directions

   5     

(d) Mutual Funds

   6     

(e) Trustee Powers

   6 6   

Recordkeeping and Administrative Services to Be Performed

   7     

(a) General

   7     

(b) Accounts

   8     

(c) Inspection and Audit

   8     

(d) Effect of Plan Amendment

   8     

(e) Returns, Reports and Information

   9 7   

Compensation and Expenses

   9 8   

Directions and Indemnification

   9     

(a) Identity of Administrator

   9     

(b) Directions from Administrator

   9     

(c) Directions from Participants

   10     

(d) Indemnification

   10     

(e) Survival

   10 9   

Resignation or Removal of Trustee

   10     

(a) Resignation & Removal

   10     

(b) Termination

   11     

(c) Notice Period

   11     

(d) Early Termination

         

(e) Transition Assistance

   11     

(f) Failure to Appoint Successor

   11

 

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TABLE OF CONTENTS

(Continued)

 

Section

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   Page

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10   

Successor Trustee

   11     

(a) Appointment

   11     

(b) Acceptance

   11     

(c) Corporate Action

   12 11   

Resignation, Removal, and Termination Notices

   12 12   

Duration

   12 13   

Insolvency of Sponsor

   12 14   

Amendment or Modification

   13 15   

Electronic Services

   13 16   

General

   15     

(a) Performance by Trustee, its Agent or Affiliates

   15     

(b) Entire Agreement

   15     

(c) Waiver

   15     

(d) Successors and Assigns

   15     

(e) Partial Invalidity

   15     

(f) Section Headings

   16 17   

Governing Law

   16     

(a) Massachusetts Controls

   16     

(b) Trust Agreement Controls

   16 Schedules      A.   

Recordkeeping and Administrative Services

     B.   

Fee Schedule

     C.   

Administrator’s Authorization Letter

     D.   

Operational Guidelines for Non-Fidelity Mutual Funds

     E.   

Exchange Guidelines

    

 

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TRUST AGREEMENT, dated as of the twelfth day of July, 2002, between
GLOBALSANTAFE CORPORATE SERVICES INC., a California corporation, having an
office at 777 North Eldridge Parkway, Houston, Texas 77079 (the “Sponsor”), and
FIDELITY MANAGEMENT TRUST COMPANY, a Massachusetts trust company, having an
office at 82 Devonshire Street, Boston, Massachusetts 02109 (the “Trustee”).

 

WITNESSETH:

 

WHEREAS, the Sponsor is the sponsor of the GlobalSantaFe Key Employee Deferred
Compensation Plan (the “Plan”); and

 

WHEREAS, the Sponsor wishes to establish an irrevocable trust and to contribute
to the trust assets that shall be held therein, subject to the claims of
Sponsor’s creditors in the event of Sponsor’s Insolvency, as herein defined,
until paid to Participants and their beneficiaries in such manner and at such
times as specified in the Plan; and

 

WHEREAS, it is the intention of the parties that this Trust shall constitute an
unfunded arrangement and shall not affect the status of the Plan as an unfunded
plan maintained for the purpose of providing deferred compensation for a select
group of management or highly compensated employees for purposes of Title I of
the Employee Retirement Income Security Act of 1974 (“ERISA”); and

 

WHEREAS, it is the intention of the Sponsor to make contributions to the trust
to provide itself with a source of funds to assist it in the meeting of its
liabilities under the Plan; and

 

WHEREAS, the Trustee is willing to hold and invest the aforesaid Plan assets in
trust among several investment options selected by the Sponsor; and

 

WHEREAS, the Sponsor wishes to have the Trustee perform certain ministerial
recordkeeping and administrative functions under the Plan; and

 

WHEREAS, the committee designated by the Sponsor (the “Administrator”) is the
administrator of the Plan; and

 

WHEREAS, the Trustee is willing to perform recordkeeping and administrative
services for the Plan if the services are purely ministerial in nature and are
provided within a framework

 

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of Plan provisions, guidelines and interpretations conveyed in writing to the
Trustee by the Administrator.

 

NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants and agreements set forth below, the Sponsor and the Trustee agree as
follows:

 

Section 1. Definitions. The following terms as used in this Trust Agreement have
the meaning indicated unless the context clearly requires otherwise:

 

(a) “Administrator” shall mean, with respect to the Plan, the person or entity
which is the “administrator” of such Plan.

 

(b) “Agreement” shall mean this Trust Agreement, as the same may be amended and
in effect from time to time.

 

(c) “Code” shall mean the Internal Revenue Code of 1986, as it has been or may
be amended from time to time.

 

(d) “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
it has been or may be amended from time to time.

 

(e) “Fidelity Mutual Fund” shall mean any investment company advised by Fidelity
Management & Research Company or any of its affiliates.

 

(f) “Insolvent” shall mean that (i) the Sponsor is unable to pay its debts as
they become due, or (ii) the Sponsor is subject to a pending proceeding as a
debtor under the United States Bankruptcy Code.

 

(g) “Mutual Fund” shall refer both to Fidelity Mutual Funds and Non-Fidelity
Mutual Funds.

 

(h) “Non-Fidelity Mutual Fund” shall mean certain investment companies not
advised by Fidelity Management & Research Company or any of its affiliates.

 

(i) “Participant” shall mean, with respect to the Plan, any employee (or former
employee) with an account under the Plan, which has not yet been fully
distributed and/or forfeited, and shall include the designated beneficiary(ies)
with respect to the account of any deceased employee (or deceased former
employee) until such account has been fully distributed and/or forfeited.

 

(j) “Participant Recordkeeping Reconciliation Period” shall mean the period
beginning on the date of the initial transfer of assets to the Trust and ending
on the date of the completion of the reconciliation of Participant records.

 

(k) “Plan” shall mean the GlobalSantaFe Key Employee Deferred Compensation Plan.

 

(l)

“Reporting Date” shall mean the last day of each calendar quarter, the date as
of which the

 

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Trustee resigns or is removed pursuant to Section 9 hereof and the date as of
which this Agreement terminates pursuant to Section 11 hereof.

 

(m) “Sponsor” shall mean GlobalSantaFe Corporate Services Inc., a California
corporation, or any successor to all or substantially all of its businesses
which, by agreement, operation of law or otherwise, assumes the responsibility
of the Sponsor under this Agreement.

 

(n) “Trust” shall mean the GlobalSantaFe Key Employee Deferred Compensation Plan
Trust, being the trust established by the Sponsor and the Trustee pursuant to
the provisions of this Agreement.

 

(o) “Trustee” shall mean Fidelity Management Trust Company, a Massachusetts
trust company and any successor to all or substantially all of its trust
business. The term Trustee shall also include any successor trustee appointed
pursuant to this agreement to the extent such successor agrees to serve as
Trustee under this Agreement.

 

Section 2. Trust.

 

(a) Establishment. The Sponsor hereby establishes the Trust with the Trustee.
The Trust shall consist of an initial contribution of money or other property
reasonably acceptable to the Trustee in its sole discretion, made by the Sponsor
or transferred from a previous trustee under the Plan, such additional sums of
money as shall from time to time be delivered to the Trustee under the Plan, all
investments made therewith and proceeds thereof, and all earnings and profits
thereon, less the payments that are made by the Trustee as provided herein,
without distinction between principal and income. The Trustee hereby accepts the
Trust on the terms and conditions set forth in this Agreement. In accepting this
Trust, the Trustee shall be accountable for the assets received by it, subject
to the terms and conditions of this Agreement.

 

(b) Grantor Trust. The Trust is intended to be a grantor trust, of which the
Sponsor is the grantor, within the meaning of subpart E, part I, subchapter J,
chapter 1, subtitle A of the Internal Revenue Code of 1986, as amended, and
shall be construed accordingly.

 

(c) Trust Assets. The principal of the Trust, and any earnings thereon shall be
held separate and apart from other funds of the Sponsor and shall be used
exclusively for the uses and purposes of Participants and general creditors as
herein set forth. Participants and their beneficiaries shall have no preferred
claim on, or any beneficial ownership interest in, any assets of the Trust. Any
rights created under the Plan and this Trust Agreement shall be mere unsecured
contractual rights of Participants and their beneficiaries against the Sponsor.
Any assets held by the Trust will be subject to the claims of the Sponsor’s
general creditors under federal and state law in the event of Insolvency, as
defined in Section 13 (a).

 

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(d) Non-Assignment. Benefit payments to Participants and their beneficiaries
funded under this Trust may not be anticipated, assigned (either at law or in
equity), alienated, pledged, encumbered, or subjected to attachment,
garnishment, levy, execution, or other legal or equitable process.

 

Section 3. Payments to Sponsor. Except as provided under Section 13, the Sponsor
shall have no right to retain or divert to others any of the Trust assets before
all payment of benefits have been made to the Participants and their
beneficiaries pursuant to the terms of the Plan.

 

Section 4. Disbursements.

 

(a) Directions from Administrator. The Trustee shall disburse monies to employee
Participants and their beneficiaries for benefit payments in the amounts that
the Administrator directs from time to time in writing. The Trustee shall have
no responsibility to ascertain whether the Administrator’s direction complies
with the terms of the Plan or of any applicable law unless it is clear on the
direction’s face that the actions to be taken under the direction would be
prohibited by the fiduciary duty rules of Section 404(a) of ERISA, to the extent
that ERISA is applicable, or would be contrary to the terms of the Plan as
communicated in writing by the Sponsor to the Trustee or to the terms of this
Agreement. The Trustee shall be responsible for federal or state income tax
reporting or withholding with respect to such Plan benefits. The Trustee shall
not be responsible for FICA (Social Security and Medicare), any federal or state
unemployment or local tax with respect to Plan distributions.

 

(b) Limitations. The Trustee shall not be required to make any disbursement in
excess of the net realizable value of the assets of the Trust at the time of the
disbursement. The Trustee shall not be required to make any disbursement in cash
unless the Administrator has provided a written direction as to the assets to be
converted to cash for the purpose of making the disbursement.

 

Section 5. Investment of Trust.

 

(a) Selection of Investment Options. The Trustee shall have no responsibility
for the selection of investment options under the Trust and shall not render
investment advice to any person in connection with the selection of such
options.

 

(b) Available Investment Options. The Sponsor shall direct the Trustee as to
what investment options the Trust shall be invested in (i) during the period
beginning on the initial transfer of assets to the Trust and ending on the
completion of the reconciliation of Trust records

 

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(the “reconciliation period”), and (ii) following the reconciliation period,
subject to the following limitations. The Sponsor may determine to offer as
investment options only securities issued by the investment companies advised by
Fidelity Management & Research Company and certain investment companies not
advised by Fidelity Management & Research Company identified collectively as
Mutual Funds on Schedule “A” attached hereto; provided, however, that the
Trustee shall not be considered a fiduciary with investment discretion. The
Sponsor may add or remove investment options with the consent of the Trustee and
upon mutual amendment of this Trust Agreement and the Schedules thereto to
reflect such additions.

 

(c) Investment Directions. In order to provide for an accumulation of assets
comparable to the contractual liabilities accruing under the Plan, the Sponsor
may direct the Trustee in writing to invest the assets held in the Trust to
correspond to the hypothetical investments made for Participants under the Plan.
Such directions may be made by Participants by use of a Participant service
representative, the Voice Response System (VRS), the internet or such other
electronic means as may be agreed upon from time to time by the Sponsor and the
Trustee, maintained for such purposes by the Trustee or its agents, in
accordance with Schedule “E.” In the event that the Trustee fails to receive a
proper direction from the Sponsor or from Participants, the assets in question
shall be invested in Fidelity Money Market Trust: Retirement Money Market
Portfolio until the Trustee receives a proper direction.

 

The Sponsor’s designation of available investment options under paragraphs (a)
and (b) above, the maintenance of accounts for each Plan Participant and the
crediting of investments to such accounts, the giving of investment directions
by Participants under this paragraph (c), and the exercise by Participants of
any other powers relating to investments under this Section 5 are solely for the
purpose of providing a mechanism for measuring the obligation of the Sponsor to
any particular Participant under the applicable Plan. As provided in Section
2(c) above, no Participant or beneficiary will have any preferential claim to or
beneficial ownership interest in any asset or investment, and the rights of any
Participant and his or her beneficiaries under the applicable Plan and this
Agreement are solely those of an unsecured general creditor of the Sponsor with
respect to the benefits of the Participant under the Plan.

 

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(d) Mutual Funds. The Sponsor hereby acknowledges that it has received from the
Trustee a copy of the prospectus for each Mutual Fund selected by the Sponsor as
a Plan investment option. Trust investments in Mutual Funds shall be subject to
the following limitations:

 

(i) Execution of Purchases and Sales. Purchases and sales of Fidelity Mutual
Funds (other than for Exchanges) shall be made on the date on which the Trustee
receives from the Sponsor in good order all information and documentation
necessary to accurately effect such purchases and sales (or in the case of a
purchase, the subsequent date on which the Trustee has received a wire transfer
of funds necessary to make such purchase). Transactions involving Mutual Funds
not advised by Fidelity Management & Research Company shall be executed in
accordance with the operating procedures set forth in Schedule “D” attached
hereto. Exchanges of Fidelity Mutual Funds shall be made on the same business
day that the Trustee receives a proper direction if received before market close
(generally 4:00 p.m. eastern time); if the direction is received after market
close (generally 4:00 p.m. eastern time), the exchange shall be made the
following day.

 

(ii) Voting. At the time of mailing of notice of each annual or special
stockholders’ meeting of any Mutual Fund, the Trustee shall send a copy of the
notice and all proxy solicitation materials to each Participant who has
hypothetical shares of the Mutual Fund credited to the Participant’s accounts,
together with a voting direction form for return to the Trustee or its designee.
The Participant shall have the right to direct the Trustee as to the manner in
which the Trustee is to vote the hypothetical shares credited to the
Participant’s accounts. These directions shall be held in confidence by the
Trustee and shall not be divulged to the Sponsor or its affiliates, or any
officer or employee thereof, or any other person except to the extent that the
consequences of such directions are reflected in reports regularly communicated
to any such person in the ordinary course of the performance of the Trustee’s
services hereunder. The Trustee shall vote the shares held in the Trust in the
same manner as directed by the Participant under the Plan. The Trustee shall not
vote shares for which it has received no corresponding directions from the
Participant. During the reconciliation period, the Sponsor shall have the right
to direct the Trustee as to the manner in which the Trustee is to vote the
shares of the Mutual Funds in the Trust. With respect to all rights other than
the right to vote, the Trustee shall follow the directions of the Sponsor. The
Trustee shall have no duty to solicit directions from the Sponsor.

 

(e) Trustee Powers. The Trustee shall have the following powers and authority:

 

(i) Subject to paragraphs (b), (c) and (d) of this Section 5, to sell, exchange,
convey, transfer, or otherwise dispose of any property held in the Trust, by
private contract or at public auction. No person dealing with the Trustee shall
be bound to see to the application of the

 

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purchase money or other property delivered to the Trustee or to inquire into the
validity, expediency, or propriety of any such sale or other disposition.

 

(ii) To cause any securities or other property held as part of the Trust to be
registered in the Trustee’s own name, in the name of one or more of its
nominees, or in the Trustee’s account with the Depository Trust Company of New
York and to hold any investments in bearer form, but the books and records of
the Trustee shall at all times show that all such investments are part of the
Trust.

 

(iii) To keep that portion of the Trust in cash or cash balances as the Sponsor
or Administrator may, from time to time, deem to be in the best interest of the
Trust.

 

(iv) To make, execute, acknowledge, and deliver any and all documents of
transfer or conveyance and to carry out the powers herein granted.

 

(v) With notice to the Sponsor, to settle, compromise, or submit to arbitration
any claims, debts, or damages due to or arising from the Trust; to commence or
defend suits or legal or administrative proceedings; to represent the Trust in
all suits and legal and administrative hearings; and to pay all reasonable
expenses arising from any such action, from the Trust if not paid by the
Sponsor.

 

(vi) To employ legal, accounting, clerical, and other assistance as may be
required in carrying out the provisions of this Agreement and to pay their
reasonable expenses and compensation from the Trust if not paid by the Sponsor.

 

(vii) To do all other acts although not specifically mentioned herein, as the
Trustee may deem necessary to carry out any of the foregoing powers and the
purposes of the Trust.

 

Trustee will file an annual fiduciary return to the extent required by law.

 

Section 6. Recordkeeping and Administrative Services to Be Performed.

 

(a) General. The Trustee shall perform those recordkeeping and administrative
functions described in Schedule “A” attached hereto. These recordkeeping and
administrative functions shall be performed within the framework of the Plan as
communicated in writing by the

 

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Sponsor to the Trustee and the Administrator’s written directions regarding the
Plan’s provisions, guidelines and interpretations.

 

(b) Accounts. The Trustee shall keep accurate accounts of all investments,
receipts, disbursements, and other transactions hereunder, and shall report the
value of the assets held in the Trust as of the last day of each fiscal quarter
of the Plan and, if not on the last day of a fiscal quarter, the date on which
the Trustee resigns or is removed as provided in Section 9 of this Agreement or
is terminated as provided in Section 11. Within thirty (30) days following each
Reporting Date or within sixty (60) days in the case of a Reporting Date caused
by the resignation or removal of the Trustee, or the termination of this
Agreement, the Trustee shall file with the Administrator a written account
setting forth all investments, receipts, disbursements, and other transactions
effected by the Trustee between the Reporting Date and the prior Reporting Date,
and setting forth the value of the Trust as of the Reporting Date. Except as
otherwise required under applicable law, upon the expiration of six (6) months
from the date of filing such account with the Administrator, the Trustee shall
have no liability or further accountability to anyone with respect to the
propriety of its acts or transactions shown in such account, except with respect
to such acts or transactions as to which the Sponsor shall within such six (6)
month period file with the Trustee written objections.

 

(c) Inspection and Audit. All records generated by the Trustee in accordance
with paragraphs (a) and (b) shall be open to inspection and audit, during the
Trustee’s regular business hours prior to the termination of this Agreement, by
the Administrator or any person designated by the Administrator. Upon the
resignation or removal of the Trustee or the termination of this Agreement, the
Trustee shall provide to the Administrator, at no expense to the Sponsor, in the
format regularly provided to the Administrator, a statement of each
Participant’s accounts as of the resignation, removal, or termination, and the
Trustee shall provide to the Administrator or the Plan’s new recordkeeper such
further records as are reasonable, at the Sponsor’s expense.

 

(d) Effect of Plan Amendment. Except as set forth in this Agreement, the
Trustee’s provision of the recordkeeping and administrative services set forth
in this Section 6 shall be conditioned on the Sponsor delivering to the Trustee
a copy of any amendment to the Plan as soon as administratively feasible
following the amendment’s adoption, and on the Administrator providing the
Trustee on a timely basis with all the information the Administrator deems
necessary for the Trustee to perform the recordkeeping and administrative
services and such other information as the Trustee may reasonably request to
perform its obligations hereunder.

 

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(e) Returns, Reports and Information. The Administrator shall be responsible for
the preparation and filing of all returns, reports, and information required of
the Trust or Plan by law. The Trustee shall provide the Administrator with such
information as the Administrator may reasonably request to make these filings.
The Administrator shall also be responsible for making any disclosures to
Participants required by law.

 

Section 7. Compensation and Expenses. Sponsor shall pay to Trustee, within
thirty (30) days of receipt of the Trustee’s bill, the fees for services in
accordance with Schedule “B”. All fees for services are specifically outlined in
Schedule “B” and are based on any assumptions identified therein. In the event
that the Plan characteristics referenced in the assumptions outlined in Schedule
“B” change significantly by either falling below or exceeding current or
projected levels, such fees shall be subject to revision. To reflect increased
operating costs, Trustee may once each calendar year amend Schedule “B” with the
Sponsor’s consent, which shall not be unreasonably withheld, upon ninety (90)
days prior notice to the Sponsor.

 

All reasonable expenses of Plan administration as shown on Schedule “B” attached
hereto, as amended from time to time, shall be charged against and paid from the
appropriate Participants’ accounts, except to the extent such amounts are paid
by the Plan Sponsor in a timely manner.

 

All expenses of the Trustee relating directly to the acquisition and disposition
of investments constituting part of the Trust, and all taxes of any kind
whatsoever that may be levied or assessed under existing or future laws upon or
in respect of the Trust or the income thereof, shall be charged against and paid
from the appropriate Participants’ accounts.

 

Section 8. Directions and Indemnification.

 

(a) Identity of Administrator. The Trustee shall be fully protected in relying
on the fact that the Administrator under the Plan is the individual or persons
named as such above or such other individuals or persons as the Sponsor may
notify the Trustee in writing.

 

(b) Directions from Administrator. Whenever the Administrator provides a
direction to the Trustee, the Trustee shall not be liable for any loss, or by
reason of any breach, arising from the direction if the direction is contained
in a writing (or is oral and immediately confirmed in a writing) signed by any
individual whose name and signature have been submitted

 

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(and not withdrawn) in writing to the Trustee by the Administrator in the form
attached hereto as Schedule “C”, provided the Trustee reasonably believes the
signature of the individual to be genuine unless it is clear on the direction’s
face that the actions to be taken under the direction would be prohibited by the
fiduciary duty rules of Section 404(a) of ERISA, to the extent that ERISA is
applicable, or would be contrary to the terms of this Agreement or to the terms
of the Plan as communicated by the Sponsor to the Trustee in writing. Such
direction may be made via electronic data transfer (“EDT”) in accordance with
procedures agreed to by the Administrator and the Trustee; provided, however,
that the Trustee shall be fully protected in relying on such direction as if it
were a direction made in writing by the Administrator. The Trustee shall have no
responsibility to ascertain any direction’s (i) accuracy, (ii) compliance with
the terms of the Plan or any applicable law, or (iii) effect for tax purposes or
otherwise.

 

(c) Directions from Participants. The Trustee shall not be liable for any loss
which arises from any Participant’s exercise or non-exercise of investment
directions or voting instructions to the extent permitted by Sections 5(c) and
5(d) over the assets in the Participant’s accounts.

 

(d) Indemnification. The Sponsor shall indemnify the Trustee against, and hold
the Trustee harmless from, any and all loss, damage, penalty, liability, cost,
and expense, including without limitation, reasonable attorneys’ fees and
disbursements, that may be incurred by, imposed upon, or asserted against the
Trustee by reason of any claim, regulatory proceeding, or litigation arising
from any act done or omitted to be done by any individual or person with respect
to the Plan or Trust, excepting only any and all loss, etc., arising solely from
the Trustee’s negligence, bad faith, willful misconduct or breach of duties
under this Agreement.

 

(e) Survival. The provisions of this Section 8 shall survive the termination of
this Agreement.

 

Section 9. Resignation or Removal of Trustee and Termination.

 

(a) Resignation and Removal.

 

(i) The Trustee may resign at any time in accordance with the notice provisions
set forth below.

 

(ii) The Sponsor may remove the Trustee at any time in accordance with the
notice provisions set forth below.

 

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(b) Termination. This Agreement may be terminated in full, or with respect to
only a portion of the Plan (i.e., a “partial deconversion”) at any time by the
Sponsor upon prior written notice to the Trustee in accordance with the notice
provisions set forth below.

 

(c) Notice Period. In the event either party desires to terminate this Agreement
or any Services hereunder, the party shall provide at least sixty-(60) days
prior written notice of the termination date to the other party; provided,
however, that the receiving party may agree, in writing, to a shorter notice
period.

 

(d) Transition Assistance. In the event of termination of this Agreement, if
requested by Sponsor, Trustee shall assist Sponsor in developing a plan for the
orderly transition of the Plan data, cash and assets then constituting the
Trustee and Services provided by Trustee hereunder to Sponsor or its designee.
Trustee shall provide such assistance for a period not extending beyond sixty
(60) days from the termination date of this Agreement. Trustee shall provide to
Sponsor, or to any person designated by Sponsor, at a mutually agreeable time,
one file of the Plan data prepared and maintained by Trustee in the ordinary
course of business, in Trustee’s format. Trustee may provide other or additional
transition assistance as mutually determined for additional fees, which shall be
due and payable by the Sponsor prior to any termination of this Agreement.

 

(e) Failure to Appoint Successor. If, by the termination date, the Sponsor has
not notified the Trustee in writing as to the individual or entity to which the
assets and cash are to be transferred and delivered, the Trustee may bring an
appropriate action or proceeding in a court of competent jurisdiction for leave
to deposit the assets and cash in a court of competent jurisdiction. The Trustee
shall be reimbursed by the Sponsor for all costs and expenses of the action or
proceeding including, without limitation, reasonable attorneys’ fees and
disbursements.

 

Section 10. Successor Trustee.

 

(a) Appointment. If the office of Trustee becomes vacant for any reason, the
Sponsor may in writing appoint a successor trustee under this Agreement. The
successor trustee shall have all of the rights, powers, privileges, obligations,
duties, liabilities, and immunities granted to the Trustee under this Agreement.
The successor trustee and predecessor trustee shall not be liable for the acts
or omissions of the other with respect to the Trust.

 

(b) Acceptance. When the successor trustee accepts its appointment under this
Agreement, title to and possession of the Trust assets shall immediately vest in
the successor

 

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trustee without any further action on the part of the predecessor trustee. The
predecessor trustee shall execute all instruments and do all acts that
reasonably may be necessary or reasonably may be requested in writing by the
Sponsor or the successor trustee to vest title to all Trust assets in the
successor trustee or to deliver all Trust assets to the successor trustee.

 

(c) Corporate Action. Any successor of the Trustee or successor trustee, through
sale or transfer of the business or trust department of the Trustee or successor
trustee, or through reorganization, consolidation, or merger, or any similar
transaction, shall, upon consummation of the transaction, become the successor
trustee under this Agreement.

 

Section 11. Resignation, Removal, and Termination Notices. All notices of
resignation, removal, or termination under this Agreement must be in writing and
mailed to the party to which the notice is being given by certified or
registered mail, return receipt requested, to the Sponsor c/o Legal Department,
GlobalSantaFe Corporate Services Inc., 777 North Eldridge Parkway, Houston,
Texas 77079, and to the Trustee c/o Legal Department, ERISA Group, Fidelity
Investments, 82 Devonshire Street, F7A, Boston, Massachusetts 02109, or to such
other addresses as the parties have notified each other of in the foregoing
manner.

 

Section 12. Duration. This Trust shall continue in effect without limit as to
time, subject, however, to the provisions of this Agreement relating to
amendment, modification, and termination thereof.

 

Section 13. Insolvency of Sponsor.

 

(a) Trustee shall cease disbursement of funds for payment of benefits to
Participants and their beneficiaries if the Sponsor is Insolvent.

 

(b) At all times during the continuance of this Trust, the principal and income
of the Trust shall be subject to claims of general creditors of the Sponsor
under federal and state law as set forth below.

 

(i) The Board of Directors and the Chief Executive Officer of the Sponsor shall
have the duty to inform Trustee in writing of Sponsor’s Insolvency. If a person
claiming to be a creditor of the Sponsor alleges in writing to Trustee that
Sponsor has become Insolvent, Trustee shall determine whether Sponsor is
Insolvent and, pending such determination, Trustee shall discontinue
disbursements for payment of benefits to Participants or their beneficiaries.

 

12

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(ii) Unless Trustee has actual knowledge of Sponsor’s Insolvency, or has
received notice from Sponsor or a person claiming to be a creditor alleging that
Sponsor is Insolvent, Trustee shall have no duty to inquire whether Sponsor is
Insolvent. Trustee may in all events rely on such evidence concerning Sponsor’s
solvency as may be furnished to Trustee and that provides Trustee with a
reasonable basis for making a determination concerning Sponsor’s solvency.

 

(iii) If at any time Trustee has determined that Sponsor is Insolvent, Trustee
shall discontinue disbursements for payments to Participants or their
beneficiaries and shall hold the assets of the Trust for the benefit of
Sponsor’s general creditors. Nothing in this Trust Agreement shall in any way
diminish any rights of Participants or their beneficiaries to pursue their
rights as general creditors of Sponsor with respect to benefits due under the
Plan or otherwise.

 

(iv) Trustee shall resume disbursement for the payment of benefits to
Participants or their beneficiaries in accordance with Section 4 of this Trust
Agreement only after Trustee has determined that Sponsor is not Insolvent (or is
no longer Insolvent).

 

(c) Provided that there are sufficient assets, if Trustee discontinues the
payment of benefits from the Trust pursuant to (a) hereof and subsequently
resumes such payments, the first payment following such discontinuance shall
include the aggregate amount of all payments due to Participants or their
beneficiaries under the terms of the Plan for the period of such discontinuance,
less the aggregate amount of any payments made to Participants or their
beneficiaries by Sponsor in lieu of the payments provided for hereunder during
any such period of discontinuance.

 

Section 14. Amendment or Modification. This Agreement may be amended or modified
at any time and from time to time only by an instrument executed by both the
Sponsor and the Trustee. The individuals authorized to sign such instrument
shall be those authorized by the Sponsor on Schedule “C.”

 

Section 15. Electronic Services.

 

(a) The Trustee may provide communications and services (“Electronic Services”)
and/or software products (“Electronic Products”) via electronic media,
including, but

 

13

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not limited to Fidelity Plan Sponsor WebStation. Such communications shall be in
addition to, and not in lieu of, written statements for the Trust and for each
Participant, issued no less frequently than quarterly. The Sponsor and its
agents agree to use such Electronic Services and Electronic Products only in the
course of reasonable administration of or participation in the Plan and to keep
confidential and not publish, copy, broadcast, retransmit, reproduce,
commercially exploit or otherwise redisseminate the Electronic Products or
Electronic Services or any portion thereof without the Trustee’s written
consent, except, in cases where Trustee has specifically notified the Sponsor
that the Electronic Products or Services are suitable for delivery to Sponsor’s
Participants, for non-commercial personal use by Participants or beneficiaries
with respect to their participation in the Plan or for their other retirement
planning purposes.

 

(b) The Sponsor shall be responsible for installing and maintaining all
Electronic Products, (including any programming required to accomplish the
installation) and for displaying any and all content associated with Electronic
Services on its computer network and/or Intranet so that such content will
appear exactly as it appears when delivered to Sponsor. All Electronic Products
and Services shall be clearly identified as originating from the Trustee or its
affiliate. The Sponsor shall as soon as administratively practicable remove
Electronic Products or Services from its computer network and/or Intranet, or
replace the Electronic Products or Services with updated products or services
provided by the Trustee, upon written notification (including written
notification via facsimile) by the Trustee.

 

(c) All Electronic Products shall be provided to the Sponsor without any express
or implied legal warranties or acceptance of legal liability by the Trustee, and
all Electronic Services shall be provided to the Sponsor without acceptance of
legal liability related to or arising out of the electronic nature of the
delivery or provision of such Services. Except as otherwise stated in this
Agreement, no rights are conveyed to any property, intellectual or tangible,
associated with the contents of the Electronic Products or Services and related
material. The Trustee hereby grants to the Sponsor a non-exclusive,
non-transferable revocable right and license to use the Electronic Products and
Services in accordance with the terms and conditions of this Agreement.

 

(d) To the extent that any Electronic Products or Services utilize Internet
services to transport data or communications, the Trustee will take, and Sponsor
agrees to follow,

 

14

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reasonable security precautions, however, the Trustee disclaims any liability
for interception of any such data or communications. The Trustee reserves the
right not to accept data or communications transmitted via electronic media by
the Sponsor or a third party if it determines that the media does not provide
adequate data security, or if it is not administratively feasible for the
Trustee to use the data security provided. The Trustee shall notify the Sponsor
upon making such determination. The Trustee shall not be responsible for, and
makes no warranties regarding access, speed or availability of Internet or
network services, or any other service required for electronic communication.
The Trustee shall not be responsible for any loss or damage related to or
resulting from any changes or modifications to the Electronic Products or
Services after delivering it to the Sponsor.

 

Section 16. General.

 

(a) Performance by Trustee, its Agents or Affiliates. The Sponsor acknowledges
and authorizes that the services to be provided under this Agreement shall be
provided by the Trustee, its agents or affiliates, including Fidelity
Investments Institutional Operations Company, Inc. or its successor, and that
certain of such services may be provided pursuant to one or more other
contractual agreements or relationships.

 

(b) Entire Agreement. This Agreement contains all of the terms agreed upon
between the parties with respect to the subject matter hereof.

 

(c) Waiver. No waiver by either party of any failure or refusal to comply with
an obligation hereunder shall be deemed a waiver of any other or subsequent
failure or refusal to so comply.

 

(d) Successors and Assigns. The stipulations in this Agreement shall inure to
the benefit of, and shall bind, the successors and assigns of the respective
parties.

 

(e) Partial Invalidity. If any term or provision of this Agreement or the
application thereof to any person or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement, or the application of
such term or provision to persons or circumstances other than those as to which
it is held invalid or unenforceable, shall not be affected thereby, and each
term and provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.

 

15

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(f) Section Headings. The headings of the various sections and subsections of
this Agreement have been inserted only for the purposes of convenience and are
not part of this Agreement and shall not be deemed in any manner to modify,
explain, expand or restrict any of the provisions of this Agreement.

 

Section 17. Governing Law.

 

(a) Massachusetts Law Controls. This Agreement is being made in the Commonwealth
of Massachusetts, and the Trust shall be administered as a Massachusetts trust.
The validity, construction, effect, and administration of this Agreement shall
be governed by and interpreted in accordance with the banking laws of the
Commonwealth of Massachusetts to the extent they govern the activities of the
Trustee and otherwise in accordance with the laws of Texas, except to the extent
those laws are superseded under Section 514 of ERISA.

 

(b) Trust Agreement Controls. The Trustee is not a party to the Plan, and in the
event of any conflict between the provisions of the Plan and the provisions of
this Agreement, the provisions of this Agreement shall control with respect to
the responsibilities of the Trustee. In all other cases, the provisions of the
Plan shall control.

 

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

 

            GLOBALSANTAFE CORPORATE SERVICES INC.     Attest:  

LOGO [g71896image01.jpg]

 

7-11-02

      By:  

LOGO [g71896image02.jpg]

 

7-11-02

   

Secretary

             

Vice President

                FIDELITY MANAGEMENT TRUST COMPANY     Attest:  

LOGO [g71896image03.jpg]

          By  

LOGO [g71896image04.jpg]

 

8/20/02

   

Assistant Clerk

             

FMTC Authorized Signatory

                       

Roberta Coen

   

 

16

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Schedule “A”

 

RECORDKEEPING AND ADMINISTRATIVE SERVICES

 

•   The Trustee will provide only the recordkeeping and administrative services
set forth on this Schedule “A” and no others.

 

Administration

 

•   Establishment and maintenance of Participant account and election
percentages.

 

•   Maintenance of the following Plan investment options:

 

  •   Fidelity Blue Chip Growth Fund

 

  •   Fidelity Diversified International Fund

 

  •   Fidelity Dividend Growth Fund

 

  •   Fidelity Equity-Income Fund

 

  •   Fidelity Freedom Income Fund®

 

  •   Fidelity Freedom 2000 Fund®

 

  •   Fidelity Freedom 2010 Fund®

 

  •   Fidelity Freedom 2020 Fund®

 

  •   Fidelity Freedom 2030 Fund®

 

  •   Fidelity Freedom 2040 Fund®

 

  •   Fidelity Low-Priced Stock Fund

 

  •   Fidelity Magellan® Fund

 

  •   Fidelity Mid-Cap Stock Fund

 

  •   Fidelity Money Market Trust: Retirement Money Market Portfolio

 

  •   Fidelity OTC Portfolio

 

  •   Fidelity Small Cap Stock Fund

 

  •   Fidelity U.S. Bond Index Fund

 

  •   Vanguard Asset Allocation Fund- Investor Shares

 

  •   Vanguard Extended Market Index Fund- Investor Shares

 

  •   Vanguard 500 Index Fund

 

•   Maintenance of the following money classifications:

 

  •   Deferral Contributions

 

Processing

 

•   Processing of mutual fund trades.

 

•   Maintain and process changes to Participants’ prospective investment mix
elections.

 

•   Process exchanges between investment options on a daily basis.

 

•   Provide consolidated payroll contribution data processing via electronic
data transfer.

 

•  

Provide reconciliation and processing of Participant withdrawal requests as
approved and directed by the Sponsor. All withdrawal requests will be based on
the current market values of the Participants’ accounts, not advances or
estimated values. The “current market value” of a Participant’s account shall be
the account value on the business day that direction is

 

17

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received from the Sponsor in good order by the Trustee, if such direction is
confirmed before 4:00 p.m. (E.T.). If direction from the Sponsor is confirmed by
the Trustee after 4:00 p.m. (E.T.) on a business day, then the current market
value of a Participant’s account shall be the account value on the next business
day.

 

Other

 

•   Prepare, reconcile and deliver a monthly Trial Balance Report presenting all
money classes and investments. This report is based on the market value as of
the last business day of the month. The report will be delivered not later than
thirty (30) days after the end of each month in the absence of unusual
circumstances.

 

•   Prepare, reconcile and deliver a Quarterly Administrative Report presenting
both on a Participant and a total Plan basis all money classes, investment
positions and a summary of all activity of the Participant and Plan as of the
last business day of the quarter. The report will be delivered not later than
thirty (30) days after the end of each quarter in the absence of unusual
circumstances.

 

•   Prepare and distribute, either to the Sponsor or to each Participant
directly, a quarterly detailed Participant statement reflecting all activity for
the period. Paper statements will be delivered not later than thirty (30) days
after each quarter in the absence of unusual circumstances. Paper statements
mailed directly to the Participant will be sent via first class mail unless
otherwise elected by the Participant.

 

•   Provide monthly trial balance

 

•   Prepare and mail to the Participant, a confirmation of the transactions
exchanges and changes to investment mix elections) within five (5) business days
of the Participants instructions.

 

•   Provide access to Plan Sponsor Webstation (PSW). PSW is a graphical,
Windows-based application that provides current Plan and Participant-level
information, including indicative data, account balances, activity and history.

 

•   Provide Mutual Fund tax reporting (Forms 1099 Div. and 1099-B) to the
Sponsor.

 

•   Provide Federal and state tax reporting and withholding on benefit payments
made to Participants and beneficiaries in accordance with Section 4 of this
Agreement.

 

•   Prepare employee communications describing available investment options,
including multimedia informational materials and group presentations.

 

Communication Services.

 

•   Provide employee communications describing available investment options,
including multimedia informational materials and group presentations.

 

•   Fidelity PortfolioPlanner (SM), an internet-based educational service for
Participants that generates target asset allocations and model portfolios
customized to investment options in the Plan(s) based upon methodology provided
by Strategic Advisers, Inc., an affiliate of the Trustee. The Sponsor
acknowledges that it has received the ADV Part II for Strategic Advisers, Inc.
more than 48 hours prior to executing the Trust.

 

GLOBALSANTAFE CORPORATE SERVICES INC.

     

FIDELITY MANAGEMENT TRUST COMPANY

By:  

LOGO [g71896image02.jpg]

 

7-11-02

      By:  

LOGO [g71896image04.jpg]

 

8/20/02

       

Date

         

FMTC Authorized Signatory

 

Date

                   

Roberta Coen

   

 

18

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Schedule “B”

 

FEE SCHEDULE

 

Annual Participant Fee:   $0.00 per Participant*, billed and payable quarterly.

 

*This fee will be imposed for each calendar quarter, or any part thereof, that
it remains necessary to maintain a Participant’s account(s) as part of the
Plan’s records, e.g., vested, deferred, forfeiture, and terminated Participants
who must remain on file through calendar year-end for reporting purposes.

 

Non-Fidelity Mutual Funds:   Non-Fidelity Mutual Fund vendors shall pay fees
directly to Fidelity Investments Institutional Operations Company, Inc. (FIIOC)
or its affiliates equal to such percentage (generally 25 to 50 basis points) of
plan assets invested in such Non-Fidelity Mutual Funds as may be disclosed
periodically, or, in the case of the following investment options, in the
amounts listed below:    

•      0 basis points for the Vanguard Asset Allocation Fund- Admiral Shares

   

•      0 basis points for the Vanguard Extended Market Index Fund- Admiral
Shares

   

•      0 basis points for the Vanguard Institutional Index Fund

   

•      0 basis points for the Vanguard 500 Index Fund

    Unless otherwise noted, disclosure shall be posted and updated quarterly on
Plan Sponsor Webstation at https://psw.fidelity.com or a successor site. Plan
Sponsor Webstation (PSW):   Two User I.D.’s provided free of charge.    
Additional I.D.’s available upon request.

 

Other Fees: Separate charges for extraordinary expenses resulting from large
numbers of simultaneous manual transactions, from errors not caused by Fidelity,
reports not contemplated in this Agreement, corporate actions, or the provision
of communications materials in hard copy which are also accessible to
Participants via electronic services in the event that the provision of such
material in hard copy would result in an additional expense deemed to be
material.

 

Fees for corporate actions will be negotiated separately based on the
characteristics of the project as well as the overall relationship at the time
of the project.

 

19

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*Note: Assumptions - These fees have been negotiated and accepted based on
current participation of 9 Participants. Fees will be subject to revision if
these Plan characteristics change significantly (i.e. +/- 10%) by either falling
below or exceeding current or projected levels. Fees also have been based on the
use of up to 20 investment options, and such fees will be subject to revision if
additional investment options are added.

 

GLOBALSANTAFE

CORPORATE SERVICES INC.

          FIDELITY MANAGEMENT TRUST COMPANY     By:  

LOGO [g71896image02.jpg]

 

7-11-02

      By:  

LOGO [g71896image04.jpg]

 

8/20/02

        Date           FMTC Authorized Signatory   Date                    
Roberta Coen    

 

20

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LOGO [g71896image05.jpg]              15375 Memorial Drive             
Houston, TX77079              Tel 281.596.5100              Fax 281.531.1260

 

Schedule “C”

 

August 27, 2002

 

Mr. Peter Lacy

Fidelity Investments Institutional Operations Company

82 Devonshire Street, MM3H

Boston MA 02109

 

GlobalSantaFe Key Employee Deferred Compensation Plan

 

Dear Mr. Lacy:

 

This letter is sent to you in accordance with Section 8(b) of the Trust
Agreement, dated as of July 12, 2002, between GlobalSantaFe Corporate Services
Inc. and Fidelity Management Trust Company. I hereby designate Leo C. Nelson,
Jr. and Loretta Carpenter, as the individuals who may provide directions upon
which Fidelity Management Trust Company shall be fully protected in relying.
Only one such individual need provide any direction. The signature of each
designated individual is set forth below and certified to be such.

 

You may rely upon each designation and certification set forth in this letter
until I deliver to you written notice of the termination of authority of a
designated individual.

 

Very truly yours,

GlobalSantaFe Corporate Services Inc.

LOGO [g71896image08.jpg]

 

LOGO [g71896image06.jpg] Leo C. Nelson, Jr. LOGO [g71896image07.jpg]

Loretta Carpenter

 

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

 

Schedule “D”

 

OPERATIONAL GUIDELINES FOR NON-FIDELITY MUTUAL FUNDS

 

Pricing

 

By 7:00 p.m. Eastern Time (“ET) each Business Day, the Non-Fidelity Mutual Fund
Vendor (Fund Vendor) will input the following information (“Price Information”)
into the Fidelity Participant Recordkeeping System (“FPRS”) via the remote
access price screen that Fidelity Investments Institutional Operations Company,
Inc. (“FIIOC”), an affiliate of the Trustee, has provided to the Fund Vendor:
(1) the net asset value for each Fund at the Close of Trading, (2) the change in
each Fund’s net asset value from the Close of Trading on the prior Business Day,
and (3) in the case of an income fund or funds, the daily accrual for interest
rate factor (“mil rate”). FIIOC must receive Price Information each Business Day
(a “Business Day” is any day the New York Stock Exchange is open). If on any
Business Day the Fund Vendor does not provide such Price Information to FIIOC,
FIIOC shall pend all associated transaction activity in the Fidelity Participant
Recordkeeping System (“FPRS”) until the relevant Price Information is made
available by Fund Vendor.

 

Trade Activity and Wire Transfers

 

By 7:00 a.m. ET each Business Day following Trade Date (“Trade Date Plus One”),
FIIOC will provide, via facsimile, to the Fund Vendor a consolidated report of
net purchase or net redemption activity that occurred in each of the Funds up to
4:00 p.m. ET on the prior Business Day. The report will reflect the dollar
amount of assets and shares to be invested or withdrawn for each Fund. FIIOC
will transmit this report to the Fund Vendor each Business Day, regardless of
processing activity. In the event that data contained in the 7:00 a.m. ET
facsimile transmission represents estimated trade activity, FIIOC shall provide
a final facsimile to the Fund Vendor by no later than 9:00 a.m. ET. Any
resulting adjustments shall be processed by the Fund Vendor at the net asset
value for the prior Business Day.

 

The Fund Vendor shall send via regular mail to FIIOC transaction confirms for
all daily activity in each of the Funds. The Fund Vendor shall also send via
regular mail to FIIOC, but no later than the fifth Business Day following
calendar month close, a monthly statement for each Fund. FIIOC agrees to notify
the Fund Vendor of any balance discrepancies within twenty (20) Business Days of
receipt of the monthly statement.

 

For purposes of wire transfers, FIIOC shall transmit a daily wire for aggregate
purchase activity and the Fund Vendor shall transmit a daily wire for aggregate
redemption activity, in each case including all activity across all Funds
occurring on the same day.

 

Prospectus Delivery

 

FIIOC shall be responsible for the timely delivery of Fund prospectuses and
periodic Fund reports (“Required Materials”) to Participants, and shall retain
the services of a third-party vendor to handle such mailings. The Fund Vendor
shall be responsible for all materials and production costs, and hereby agrees
to provide the Required Materials to the third-party vendor selected by FIIOC.
The Fund Vendor shall bear the costs of mailing annual Fund reports to
Participants. FIIOC shall bear the costs of mailing prospectuses to
Participants.

 

Proxies

 

The Fund Vendor shall be responsible for all costs associated with the
production of proxy materials. FIIOC shall retain the services of a third-party
vendor to handle proxy solicitation

 

22

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mailings and vote tabulation. Expenses associated with such services shall be
billed directly the Fund Vendor by the third-party vendor.

 

Participant Communications

 

The Fund Vendor shall provide internally prepared fund descriptive information
approved by the Funds’ legal counsel for use by FIIOC in its written Participant
communication materials. FIIOC shall utilize historical performance data
obtained from third-party vendors (currently Morningstar, Inc., FACTSET Research
Systems and Lipper Analytical Services) in telephone conversations with
Participants and in quarterly Participant statements. The Sponsor hereby
consents to FIIOC’s use of such materials and acknowledges that FIIOC is not
responsible for the accuracy of third-party information. FIIOC shall seek the
approval of the Fund Vendor prior to retaining any other third-party vendor to
render such data or materials under this Agreement.

 

Compensation

 

FIIOC shall be entitled to fees as set forth in a separate agreement with the
Fund Vendor.

 

23

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Schedule “E”

 

EXCHANGE GUIDELINES

 

The following exchange procedures are currently employed by Fidelity Investments
Institutional Operations Company, Inc. (FIIOC).

 

Exchange hours, via a Fidelity Participant service representative, are 8:30 a.m.
(ET) to 8:00 p.m. in the Participant’s time zone in the continental United
States on each business day. A “business day” is any day on which the New York
Stock Exchange (NYSE) is open.

 

Exchanges via the internet may be made virtually 24 hours a day.

 

Exchanges via VRS may be made virtually 24 hours a day.

 

FIIOC reserves the right to change these Exchange Guidelines at its discretion.

 

Note: The NYSE’s normal closing time is 4:00 p.m. (ET); in the event the NYSE
alters its closing time, all references below to 4:00 p.m. (ET) shall mean the
NYSE closing time as altered.

 

Mutual Funds

 

Exchanges Between Mutual Funds

 

In accordance with this Agreement, the Sponsor may direct that Participants
contact Fidelity on any day to exchange between mutual funds. If the request is
confirmed before the close of the market (generally, 4:00 p.m. ET) on a business
day, it will receive that day’s trade date. Requests confirmed after the close
of the market on a business day (or on any day other than a business day) will
be processed on a next day basis.

 

GLOBALSANTAFE CORPORATE SERVICES INC. By  

LOGO [g71896image02.jpg]

 

7-11-02

        Date

 

24