Exhibit 10.37

(GLOBALSANTAFE LOGO) [h13385h1338500.gif]

     
GlobalSantaFe Corporation
 
15375 Memorial Dr.
 
Houston, TX 77079

Notice of Grant of Stock Options

         
«First_Name» «Last_Name»
  Employee ID:  
«AddressLine_1»
  «Empl_ID»  
«AddressLine_2»
     
«Address_Line_3»
     
«City», «State» «Zip»
   

Plan Name: GlobalSantaFe 2003 Long-Term Incentive Plan

Effective                   , you have been granted an option to buy «OPTIONS»
ordinary shares of GlobalSantaFe Corporation at $                   per share.
The total option price of the shares granted is $«Price».

This grant is composed of Incentive Stock Options (ISO) and/or Non-Qualified
Options (NQ), as indicated below. The number of ISO versus NQ options (if any)
has been determined based on current IRS regulations that may limit the number
of your options which can be treated as an ISO.

Your options will vest over a three year period, on the dates indicated below:

                  Number             of Options

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  Date Vested

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  Date Options Expire

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(ISO NQ LOGO) [h13385h1338501.gif]
  «ISO1»        

   

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«ISO2»        

   

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«ISO3»        

   

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«NQ1»        

   

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«NQ2»        

   

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«NQ3»        

   

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Form 2A(3)
(12-03)

This option is granted under and governed by the terms and conditions of the
GlobalSantaFe 2003 Long-Term Incentive Plan and the attached terms and
conditions, all of which are made a part of this document.

 

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Form 2A(3)
(12-03)

(GLOBALSANTAFE LOGO) [h13385h1338500.gif]

GLOBALSANTAFE CORPORATION

TERMS AND CONDITIONS
OF
STOCK OPTION GRANT
GlobalSantaFe 2003 Long-Term Incentive Plan

     GLOBALSANTAFE CORPORATION (the “Company”), desiring to afford you an
opportunity to purchase ordinary shares of the Company, $.01 par value
(“Ordinary Shares”), and to provide you with an added incentive as an employee
of, consultant to, or other person providing key services to the Company or of
one or more of its Related Companies, has established the following terms and
conditions under which it has granted you an option (“Option”) under the
GlobalSantaFe 2003 Long-Term Incentive Plan to purchase a number of such
Ordinary Shares during a specified term and at a specified price, all as set
forth on the cover page of this Notice of Grant of Stock Options (“Notice”),
subject to and upon the terms and conditions set forth on the cover page and
below.

     The cover page of this Notice indicates that this Option is either an
Incentive Stock Option or a Non-Qualified Stock Option. If this Option is an
Incentive Stock Option, it is intended, to the extent permitted at any given
time, to qualify as an “incentive stock option” within the meaning of Section
422 of the U.S. Internal Revenue Code of 1986, as amended and in effect at such
time (the “Code”), but no warranty is made as to such qualification. If this
Option is a Non-Qualified Stock Option, it does not qualify as an incentive
stock option within the meaning of Section 422 of the Code. You are urged to
consult your tax advisor prior to exercising this Option and prior to disposing
of any shares acquired upon such exercise.

1.   Specification of Date, Number of Shares, Option Price and Term.

(a)   The date of this Option is the effective date set forth in the first
paragraph on the cover page of this Notice.   (b)   The number of Ordinary
Shares optioned hereby is the number of shares set forth in the first paragraph
on the cover page of this Notice, subject to adjustments under Section 8.   (c)
  Subject to adjustments under Sections 6 and 7, the shares optioned hereby
first become purchasable in three annual installments as set forth in the table
on the cover page of this Notice (“Vesting Table”), each installment first
becoming purchasable at the date set forth for that installment under “Date
Vested” in said table.

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(d)   The per share option price under this Option is the price set forth in the
first paragraph on the cover page of this Notice, subject to adjustments under
Section 8.   (e)   The term of this Option is ten years beginning on the date of
this Option and expiring on the date set forth under “Date Options Expire” in
the table on the cover page of this Notice upon the expiration of such term,
this Option shall expire and may not be exercised.

2.   Agreement. By accepting this Option and the benefits thereof, you represent
and agree that (i) you will abide by the terms of the Plan and such other terms
and conditions as may be imposed by the committee appointed by the board of
directors to administer the Plan (the “Committee”), (ii) you will not induce or
solicit, directly or indirectly, any employee of the Company or a Related
Company to terminate such employee’s employment with the Company or such Related
Company and (iii) during the course of employment with the Company or a Related
Company and at all times thereafter, you will not disclose to others or use,
whether directly or indirectly, any Confidential Information. “Confidential
Information” shall mean the information about the Company or a Related Company
that you learned in the course of performing your duties with the Company or a
Related Company, including, without limitation, any proprietary knowledge, trade
secrets, data, information and customer lists unless such disclosure is required
by law or authorized by the Company or a Related Company.   3.   Installment
Provisions and Acceleration. This Option is not exercisable in any part until
the earliest of the dates specified in this Section and in Sections 6 and 7
below.       The installments set forth in the table on the cover page of this
Notice and referred to in Section 1(c) are cumulative, so that each matured
installment or any portion thereof may be exercised at any time until the
expiration or prior termination of this Option.       Nothing contained in this
section shall be interpreted in a way which permits you to purchase a number of
shares in excess of the number of shares optioned hereby and referred to in
Section 1(b).   4.   Method of Exercise. This Option may be exercised from time
to time, in accordance with its terms, by written notice thereof signed and
delivered by you or another person entitled to exercise this Option to the
Secretary of the Company at its principal executive office in Houston, Texas, or
as it may hereafter be located, or to such other person as may be designated by
the Secretary from time to time. Such notice shall state the number of shares
being purchased and shall be accompanied by the payment in full in cash of the
option

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    price for such number of shares. Such payment may also be made, in whole or
in part, by the surrender of Ordinary Shares of GlobalSantaFe Corporation, any
such Ordinary Shares so surrendered to be deemed to have a value equal to the
Fair Market Value (as prescribed by the Plan) of the shares; provided, however,
that any such shares used in payment that you previously acquired from the
Company upon exercise of an option or otherwise shall have been owned by you at
least six months prior to the date of exercise. Promptly after receipt of such
notice and payment, the Company shall issue certificates to you or such other
person exercising this Option.       In addition, at your request or the request
of another person entitled to exercise this Option, and to the extent permitted
by applicable law, the Company in its discretion may selectively approve
“cashless exercise” arrangements with a brokerage firm under which such
brokerage firm, on behalf of you or such other person exercising this Option,
shall pay to the Company or its designee the exercise price of this Option or of
the portion being exercised, and the Company or its designee, pursuant to an
irrevocable notice from you or such other person exercising this Option, shall
promptly deliver the shares being purchased to such firm.       Upon exercise of
this Option, the Company may withhold from the shares to be delivered shares
with a Fair Market Value (as prescribed by the Plan) sufficient to satisfy all
or a portion of any Federal, state and local tax withholding requirements, or
the person exercising this Option may deliver to the Company Ordinary Shares
with a Fair Market Value sufficient to satisfy all or a portion of such tax
withholding requirements, excluding any shares deemed unacceptable for any
reason by the Committee of the Company’s board of directors administering the
GlobalSantaFe 2003 Long-Term Incentive Plan; provided, however, that the amount
of such tax withholding satisfied by the use of Ordinary Shares shall in no case
exceed the minimum statutory withholding rate.   5.   Transferability. You may
not transfer this Option other than by will or by the laws of descent and
distribution or, if applicable, as authorized by the following sentence, and
this Option shall be exercisable during your lifetime only by you or, if
applicable, by a transferee authorized by the following sentence. To the extent
this Option is a nonqualified stock option and is not subject to incentive stock
option treatment under the Internal Revenue Code or applicable rules or
regulations thereunder, this Option or any portion thereof may be transferred by
you to (i) your spouse, children or grandchildren (“Immediate Family Members”),
(ii) a trust or trusts for your exclusive benefit and/or the exclusive benefit
of Immediate Family Members, (iii) a partnership in which you and/or Immediate
Family Members are the only partners, (iv) a transferee pursuant to a judgment,
decree or order relating to child support, alimony or marital property rights
that is made pursuant to a domestic relations law of a state or country with
competent jurisdiction (a “Domestic Relations Order”), or (v) such other
transferee as may be approved by the Committee of the board of directors in its
sole and absolute

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    discretion; provided, however, that (x) the board of directors and its
Committee each reserves the right to prohibit any transfer with or without cause
in its sole and absolute discretion, and (y) subsequent transfers of this Option
or any portion thereof are prohibited except those to or by you in accordance
with this Section, by will or the laws of descent and distribution, or pursuant
to a Domestic Relations Order. Following any transfer, this Option shall
continue to be subject to the same terms and conditions as were applicable
immediately prior to transfer, and any and all references to you in this Notice
shall be deemed to refer to the transferee; provided, however, that any and all
references to employment or events of termination of employment shall continue
to mean your employment or events of termination of your employment, and
following any such event the options shall be exercisable by the transferee only
to the extent and for the periods specified in this Notice. In addition,
notwithstanding any transfer of this Option or any portion thereof, you will
continue to be subject to withholding in connection with any exercise, if
applicable, as provided for in the GlobalSantaFe 2003 Long-Term Incentive Plan.
Each transfer shall be effected by written notice thereof duly signed and
delivered by the transferor to the Secretary of the Company at its principal
executive office in Houston, Texas, or as it may hereafter be located, or to
such other person as may be designated by the Secretary from time to time. Such
notice shall state the name and address of the transferee, the amount of this
Option being transferred, and such other information as may be requested by the
Secretary or his or her designee. The person or persons entitled to exercise
this Option shall be that person or those persons appearing on the registry
books of the Company as the owner or owners of this Option, and the Company may
treat the person or persons in whose name or names this Option is registered as
the owner or owners of this Option for all purposes. The Company shall have no
obligation to, or liability for any failure to, notify you or any transferee of
any termination of this Option at or prior to its normal expiration date or of
any event that will or might result in such termination.   6.   Termination of
Employment.

(a)   Involuntary Termination Without Cause. If your employment with the Company
or a Related Company is terminated by the Company or any such Related Company
without Cause, your Option shall become exercisable with respect to a number of
previously unpurchasable shares, prorated for the number of months (and partial
months) you were employed from the most recent vesting date until the end of the
full vesting period. With respect to all vested shares, regardless whether
vested as a result of your termination of employment or vested prior thereto,
your Option shall remain exercisable for the longer of (i) one year following
your termination date or (ii) the period during which you are entitled to
receive salary continuation under any agreement, policy, plan or other
arrangement with the Company or any of its Related Companies; provided, however,
that your Option shall in no event remain exercisable

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    beyond the term of the Option. Upon expiration of the foregoing period, your
Option shall terminate in all respects.   (b)   Voluntary Termination or
Termination With Cause. If you voluntarily terminate your employment with the
Company or a Related Company or if your employment with the Company or a Related
Company is terminated for Cause, your Option, to the extent previously vested,
shall remain exercisable for three months following your termination date and,
thereafter, shall terminate; provided, however, that your Option shall in no
event remain exercisable beyond the term of the Option. At the time your
employment with the Company and its Related Companies terminates, this Option
shall expire and terminate in all respects as to all shares other than the
shares as to which this Option can be exercised at the time of such termination.
  (c)   Retirement. If your employment with the Company and its Related
Companies terminates (for any reason other than Cause, death or disability) and
you have attained your “early retirement date” as defined in the GlobalSantaFe
Retirement Plan for Employees (or would have attained such “early retirement
date” based on your age and service had you been eligible to participate in such
plan), the shares optioned hereby and referred to in Section 1(b) will continue
to become purchasable in accordance with the Vesting Table on the cover page of
this Notice. Your Option shall terminate upon the expiration of the earlier of
(i) the five-year period following the later of your termination of employment
with the Company and its Related Companies or termination of your service as a
member of the Company’s board of directors or (ii) the term of the Option. If
this subsection (c) and any other subsection of this Section 6 both apply, this
subsection (c) will prevail.   (d)   Termination by Reason of Death or
Disability. If your employment with the Company or a Related Company is
terminated as a result of your death or Disability, your Option will immediately
become exercisable as to the full number of shares optioned hereby and referred
to in Section 1(b), to the extent not previously exercised, and will remain
exercisable as to said full number of shares for the three-year period following
the date of death or Disability; provided, however, that your Option shall in no
event remain exercisable beyond the term of the Option. For purposes of this
Section, the term “Disability” shall mean any complete and permanent Disability
as defined in Section 22(e)(3) of the Code and determined in accordance with the
procedures set forth in the regulations thereunder.

    For purposes of this Notice, a termination of your “employment” with the
Company and its Related Companies will be deemed to occur at the close of
business on the earliest of (i) the last day on which you are assigned to a
position with the Company or any of its Related Companies for the purpose of
performing

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    your occupation, in the case of termination by reason of your death,
disability or retirement, (ii) the last day of an approved leave of absence if
you do not resume the performance of your occupation for the Company or any of
its Related Companies on or before the next business day, and (iii) the last day
on which you are assigned to a position with the Company or any of its Related
Companies for the purpose of performing your occupation in any other case. For
purposes of this Notice, you shall not be considered to be an employee for the
period during which you are entitled to receive salary continuation under any
agreement, policy, plan or other arrangement with the Company or any of its
Related Companies. To the extent this Option qualifies as an incentive stock
option under the Code, it is expressly noted that an exercise of this Option
after termination of your employment (including an exercise within the time
limits set forth in this Section 6) may, depending on the reason for such
termination and the manner in which this Option is exercised, disqualify this
Option as an incentive stock option for U.S. federal income tax purposes, and
that you should consult your tax advisor before relying on this Option’s
qualification as an incentive stock option.       You may be terminated with
Cause if you willfully engage in conduct that is materially injurious to the
Company or a Related Company, monetarily or otherwise; provided, however that
(i) no termination of your employment shall be for Cause until you have been
delivered a copy of a written notice setting forth that you are guilty of the
conduct and specifying the particulars thereof in detail and (ii) termination
solely on account of inadequate performance or incompetence shall not constitute
termination with Cause. No act, nor failure to act, shall be considered
“willful” unless you have acted or failed to act, without a reasonable belief
that your action or failure to act was in the best interest of the Company or a
Related Company. Notwithstanding anything contained in this Notice to the
contrary, your failure to perform after notice of termination is given by the
Company or a Related Company shall not constitute Cause.   7.   Change in
Control. If a Change in Control occurs while you are employed by the Company or
a Related Company or if a Change in Control occurs after your employment
terminates in accordance with Section 6(c), the shares optioned hereby shall
become fully purchasable on the date of such Change in Control irrespective of
the limitations described in Section 1(c). Your Option shall remain exercisable
throughout the Option term.       A “Change in Control” means the occurrence of
any of the following events:       (i)The acquisition by any individual, entity
or group (within the meaning of Section 13(d) or 14(d) of the U.S. Securities
Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”), other than
an Excluded Person, of the beneficial ownership (within the meaning of Rule
13d-3 under the Exchange Act) of 35% or more of either (A) the then outstanding
ordinary shares of the Company or of any affiliate of the Company by which you
are employed or which directly or indirectly owns or controls any affiliate by
which you are employed (the

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    “Outstanding Company Ordinary Shares”) or (B) the combined voting power of
the then outstanding voting securities of the Company or of any affiliate of the
Company by which you are employed or which directly or indirectly owns or
controls any affiliate by which you are employed entitled to vote generally in
the election of directors (the “Outstanding Company Voting Securities”);
provided, however, that neither an acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or by any affiliate
controlled by the Company nor an acquisition by an affiliate of the Company that
remains under the Company’s control will constitute a Change in Control; or    
  (ii)Individuals who, as of the date hereof, constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the date hereof whose election, or nomination for election by the Company’s
equityholders, was approved by a vote of at least two-thirds of the directors
then comprising the Incumbent Board will be considered as though such individual
were a member of the Incumbent Board, but excluding for this purpose any such
individual whose initial assumption of office occurs as a result of either an
actual or threatened election contest (meaning a solicitation of the type that
would be subject to Rule 14a-12(c) of Regulation 14A under the Exchange Act) or
other actual or threatened solicitation of proxies or consents by or on behalf
of a Person other than the Board; or       (iii)Approval by the equityholders of
the Company of a reorganization, merger, consolidation or similar transaction to
which the Company or any affiliate is a party, in each case unless, following
such reorganization, merger, consolidation or similar transaction, (A) more than
50% of, respectively, the then outstanding ordinary shares or shares of common
stock of the corporation or other entity resulting from such reorganization,
merger, consolidation or similar transaction and the combined voting power of
the then outstanding voting securities of such corporation or other entity
entitled to vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the individuals
and entities who were the beneficial owners, respectively, of the Outstanding
Company Ordinary Shares and Outstanding Company Voting Securities immediately
prior to such reorganization, merger, consolidation or similar transaction in
substantially the same proportions as their ownership, immediately prior to such
reorganization, merger, consolidation or similar transaction, of the Outstanding
Company Ordinary Shares and Outstanding Company Voting Securities, as the case
may be, (B) 50% of, respectively, the then outstanding ordinary shares or shares
of common stock of the parent of the corporation or other entity resulting from
such reorganization, merger, consolidation or similar transaction and the
combined voting power of the then outstanding voting securities of the parent of
such corporation or other entity entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by the individuals
and entities who were the beneficial owners, respectively, of the Outstanding
Company Ordinary Shares and Outstanding Company Voting Securities immediately
prior to such reorganization, merger, consolidation or similar transaction,
(C) no Person

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    (excluding the Company, any affiliate of the Company that remains under the
Company’s control, any employee benefit plan (or related trust) sponsored or
maintained by the Company or by any affiliate controlled by the Company or such
corporation resulting from such reorganization, merger, consolidation or similar
transaction, and any Person beneficially owning, immediately prior to such
reorganization, merger, consolidation or similar transaction, directly or
indirectly, 35% or more of the Outstanding Company Ordinary Shares or
Outstanding Company Voting Securities, as the case may be) beneficially owns,
directly or indirectly, 35% or more of, respectively, the then outstanding
ordinary shares or shares of common stock of the corporation or other entity
resulting from such reorganization, merger, consolidation or similar transaction
or the combined voting power of the then outstanding voting securities of such
corporation or other entity entitled to vote generally in the election of
directors, and (D) at least a majority of the members of the board of directors
of the corporation resulting from such reorganization, merger, consolidation or
similar transaction were members of the Incumbent Board at the time of the
execution of the initial agreement providing for such reorganization, merger,
consolidation or similar transaction; or       (iv)  Approval by the
equityholders of the Company of any plan or proposal which would result directly
or indirectly in (A) a complete liquidation or dissolution of the Company or of
any affiliate of the Company by which you are employed, or (B) any sale or other
disposition (or similar transaction) (in a single transaction or series of
related transactions) of (x) 50% or more of the assets or earnings power of the
Company or any affiliate of the Company by which you are employed or which,
directly or indirectly owns or controls any affiliate by which you are employed
or (y) business operations which generated a majority of the consolidated
revenues (determined on the basis of the Company’s four most recently completed
fiscal quarters for which reports have been completed) of the Company and its
affiliates immediately prior thereto, other than to an affiliate of the Company
or to a corporation or other entity with respect to which following such sale or
other disposition (I) more than 50% of, respectively, the then outstanding
ordinary shares or shares of common stock of such corporation or other entity
and the combined voting power of the then outstanding voting securities of such
corporation or other entity entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were the beneficial
owners, respectively, of the Outstanding Company Ordinary Shares and Outstanding
Company Voting Securities immediately prior to such sale or other disposition in
substantially the same proportions as their ownership, immediately prior to such
sale or other disposition, of the Outstanding Company Ordinary Shares and
Outstanding Company Voting Securities, as the case may be, (II) no Person
(excluding the Company, any affiliate of the Company that remains under the
Company’s control, any employee benefit plan (or related trust) sponsored or
maintained by the Company or by any affiliate controlled by the Company or such
corporation, and any Person beneficially owning, immediately prior to such sale
or other disposition, directly or indirectly, 35% or more of the Outstanding
Company Ordinary Shares or Outstanding Company Voting Securities, as the

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    case may be) beneficially owns, directly or indirectly, 35% or more of,
respectively, the then outstanding ordinary shares or shares of common stock of
such corporation or other entity or the combined voting power of the then
outstanding voting securities of such corporation or other entity entitled to
vote generally in the election of directors, and (III) at least a majority of
the members of the board of directors of such corporation were members of the
Incumbent Board at the time of the execution of the initial agreement or action
of the Board providing for such sale or other disposition of assets; or      
(v)Approval by the equityholders of the Company of a “merger of equals” (which
for purposes of this Subsection shall mean a merger with another company of
relatively equal size) to which the Company is a party as a result of which the
persons who were equity holders of the Company immediately prior to the
effective date of such merger shall have beneficial ownership of less than 55%
of the combined voting power for election of members of the board (or
equivalent) of the surviving entity or its parent following the effective date
of such merger, provided that the Board shall have authority to increase said
percentage as may in its sole discretion be deemed appropriate to cover a
specific transaction.       For purposes of the preceding sentence, the term
“Excluded Person” shall mean and include (i) any corporation beneficially owned
by shareholders of the Company in substantially the same proportion as their
ownership of shares of the Company and (iii) the Company and any affiliate of
the Company. Also, for purposes of the preceding sentence, the term “Board”
shall mean the board of directors of the Company.   8.   Adjustments. If
outstanding shares of the class then subject to this Option are increased,
decreased, changed into or exchanged for a different number or kind of shares or
securities of the Company through reorganization, recapitalization,
reclassification, stock dividend, stock split or reverse stock split, then there
shall be substituted for each share then subject to the unexercised portion of
this Option the number and class of shares or securities into or for which each
outstanding share of the class subject to this Option shall be so changed or
exchanged, all without any change in the aggregate purchase price for the shares
then subject to the unexercised portion of this Option, but with a corresponding
adjustment in the purchase price per share. Such adjustments shall become
effective on the effective date of any such transaction; except that in the
event of a stock dividend or of a stock split effected by means of a stock
dividend or distribution, such adjustments shall become effective immediately
after the record date therefor.       Upon a dissolution or liquidation of the
Company, or upon a reorganization, merger or consolidation of the Company with
one or more corporations as a result of which the Company is not the surviving
corporation, or upon a sale of substantially all of the property of the Company
(“Terminating Transactions”), this Option shall terminate, unless provision be
made in writing in connection with such transaction for the assumption of
options theretofore granted under the Plan

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    under which this Option was granted, or the substitution for such options of
any options covering the stock of a successor employer corporation, or a parent
or subsidiary thereof, with appropriate adjustments as to the number and kind of
shares and prices, in which event this Option shall continue in the manner and
under the terms so provided. If this Option shall terminate pursuant to the
foregoing sentence, the person then entitled to exercise any unexercised
portions of this Option shall have the right, at such time immediately prior to
the consummation of the Terminating Transaction as the Company shall designate,
to exercise this Option to the extent not theretofore exercised.      
Adjustments under this Section 8 shall be made by the board of directors or the
Committee, whose determination as to what adjustment shall be made, and the
extent thereof, shall be final, binding and conclusive. No fractional shares of
stock shall be issued under this Option or in connection with any such
adjustment.   9.   Limitation. You or any other person entitled to exercise this
Option shall be entitled to the privileges of stock ownership in respect of
shares subject to this Option only when such shares have been issued and
delivered as fully paid shares upon exercise of this Option in accordance with
its terms.   10.   Requirements of Law and of Stock Exchanges. The issuance of
shares upon the exercise of this Option shall be subject to compliance with all
of the applicable requirements of law with respect to the issuance and sale of
such shares. In addition, neither the Company nor any Related Company shall be
required to issue or deliver any certificate or certificates for such purchase
upon exercise of this Option prior to the admission of such shares to listing on
notice of issuance on any stock exchange on which shares of the same class are
then listed.       By accepting this Option, you represent and agree for
yourself and your transferees by will or by the laws of descent and distribution
or otherwise that unless a registration statement under the Securities Act of
1933 is in effect as to shares purchased upon any exercise of this Option, any
and all shares so purchased shall be acquired for investment and not for sale or
distribution and each notice of the exercise of any portion of this Option shall
be accompanied by a representation and warranty in writing, signed by the person
entitled to exercise the same, that the shares are being so acquired by good
faith for investment and not for sale or distribution. In the event the
Company’s legal counsel shall, at the Company’s request, advise it that
registration under the Securities Act of 1933 of the shares as to which this
Option is at the time being exercised is required prior to issuance thereof,
neither the Company nor any Related Company shall be required to issue or
deliver such shares unless and until such legal counsel shall advise that such
registration has been completed or is not required.       By accepting this
Option you further represent and agree for yourself and your transferees by will
or the laws of descent and distribution that if you are an officer

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    of the Company or any other person who might be deemed an “affiliate” of the
Company under the Securities Act of 1933 at the time any shares acquired upon
exercise of this Option are proposed to be sold, you or they will not sell any
shares purchased on exercise of this Option (a) without giving thirty-days’
advance notice in writing to the Company, and (b) until the Company has advised
you or them that such sale may be made without registration under the Securities
Act of 1933 or, if such registration is required, that such registration has
been effected.   11.   Definition of Certain Terms. The term “Related Company”
means any affiliate of the Company and any other business venture in which the
Company has a significant interest as determined in the discretion of the
Committee of the board of directors. The term “you,” and related terms such as
“your” used in this Notice refer to the individual whose name appears first on
the cover page of this Notice.   12.   Continued Employment and Future Grants.
Neither the grant of this Option nor the other arrangements outlined herein give
you the right to remain in the employ of the Company or any Related Company or
to be selected to receive similar or identical grants in the future.   13.  
Notices. Notice or other communication to the Company with respect to this
Notice must be made in writing and delivered to: Secretary, GlobalSantaFe
Corporation, at its principal business office, Houston, Texas.   14.   Governing
Law. This Option and this Notice shall be governed by, and construed in
accordance with, the laws of the state of Texas.   15.   Section 280G Payments.

(a)   General Rule. Notwithstanding any contrary provisions in any plan, program
or policy of the Company or any Related Company and except as provided in
subsection (b), if all or any portion of the benefits payable under this Notice,
either alone or together with other payments and benefits which you receive or
are entitled to receive from the Company or any Related Company, would
constitute a “parachute payment” within the meaning of Section 280G of the Code,
the Company shall reduce your payments and benefits payable under this Notice to
the extent necessary so that no portion thereof shall be subject to the excise
tax imposed by Section 4999 of the Code, but only if, by reason of such
reduction, the net after-tax benefit shall exceed the net after-tax benefit if
such reduction were not made. “Net after-tax benefit” for these purposes shall
mean the sum of (i) the total amount payable to you under this Notice, plus (ii)
all other payments and benefits which you receive or are then entitled to
receive from the Company or any affiliate that, alone or in combination with the
payments and benefits payable under this Notice (after taking into

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    account any reduction contemplated in subsection (c)), would constitute a
“parachute payment” within the meaning of Section 280G of the Code (each such
benefit hereinafter referred to as an “Additional Parachute Payment”), less
(iii) the amount of federal income taxes payable with respect to the foregoing
calculated at the maximum marginal income tax rate for each year in which the
foregoing shall be paid to you (based upon the rate in effect for such year as
set forth in the Code at the time of the payment under this Notice), less
(iv) the amount of excise taxes imposed with respect to the payments and
benefits described in (i) and (ii) above by Section 4999 of the Code.   (b)  
Exception if Gross-Up Applies. If you are entitled to a Gross-Up Payment with
respect to an Additional Parachute Payment paid pursuant to any other plan,
program or policy of the Company or any Related Company, the provisions of
Section 15(a) above shall not apply. A “Gross-Up Payment” means a payment by the
Company or a Related Company to cover the excise tax imposed on an Additional
Parachute Payment by Section 4999 of the Code.   (c)   Ordering Rule.
Notwithstanding any contrary provisions in any other plan, program or policy of
the Company or any Related Company, if any plan, program or policy of the
Company or any Related Company provides for a reduction designed to avoid Code
Section 4999 excise tax, such reduction shall first be applied to any Additional
Parachute Payment subject to such reduction and, after having given effect to
such reduction, the provisions of Section 15(a) above shall apply to the
benefits payable under this Notice.

16.   GlobalSantaFe 2003 Long-Term Incentive Plan. This Option is subject to,
and the Company and you are bound by, all of the terms and conditions of the
GlobalSantaFe 2003 Long-Term Incentive Plan as the same shall have been amended
from time to time in accordance with the terms thereof, provided that no such
amendment shall deprive you, without your consent, of this Option or any rights
hereunder. Pursuant to such Plan, the board of directors or its Committee
established for such purposes is authorized to adopt rules and regulations not
inconsistent with the Plan and to take such action in the administration of the
Plan as it shall deem proper. A copy of the Plan in its present form is
available for inspection at the Company’s principal office during business hours
by you or any other persons entitled to exercise this Option.

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