Filed by Bowne Pure Compliance





Exhibit 10.38




 




EMPLOYMENT AGREEMENT




by and between




NOBLE DRILLING SERVICES INC.




and




DAVID W. WILLIAMS




December 30, 2008




 



 


 









 






EMPLOYMENT AGREEMENT

TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	1. Employment
	 	 	1	 
	 
	 	 	 	 
	2. Employment Term
	 	 	2	 
	(a) Term
	 	 	2	 
	(b) Relationship Prior to Effective Date
	 	 	2	 
	 
	 	 	 	 
	3. Positions and Duties
	 	 	2	 
	 
	 	 	 	 
	4. Compensation and Related Matters
	 	 	3	 
	(a) Base Salary
	 	 	3	 
	(b) Annual Bonus
	 	 	4	 
	(c) Employee Benefits
	 	 	4	 
	(i) Incentive, Savings and Retirement Plans
	 	 	4	 
	(ii) Welfare Benefit Plans
	 	 	4	 
	(d) Expenses
	 	 	4	 
	(e) Fringe Benefits
	 	 	5	 
	(f) Vacation
	 	 	5	 
	 
	 	 	 	 
	5. Termination of Employment
	 	 	5	 
	(a) Death
	 	 	5	 
	(b) Disability
	 	 	5	 
	(c) Termination by Company
	 	 	5	 
	(d)Termination by Executive
	 	 	6	 
	(e) Notice of Termination
	 	 	7	 
	(f) Date of Termination
	 	 	7	 
	 
	 	 	 	 
	6. Obligations of the Company upon Separation from Service
	 	 	8	 
	(a) Good Reason or During the Window Period; Other Than for Cause, Death or
Disability
	 	 	8	 
	(b) Death
	 	 	10	 
	(c) Disability
	 	 	11	 
	(d) Cause; Other than for Good Reason or During the Window Period
	 	 	11	 
	(e) Payment Delay for Specified Employees
	 	 	12	 






 


i








 






	 	 	 	 	 
	 	 	Page	 
	7. Certain Additional Payments by the Company
	 	 	12	 
	 
	 	 	 	 
	8. Representations and Warranties
	 	 	15	 
	 
	 	 	 	 
	9. Confidential Information
	 	 	15	 
	 
	 	 	 	 
	10. Certain Definitions
	 	 	15	 
	(a) Effective Date
	 	 	15	 
	(b) Change of Control Period
	 	 	16	 
	(c) Change of Control
	 	 	16	 
	(d) Separation from Service
	 	 	18	 
	(e) Specified Employee
	 	 	18	 
	(f) Separation Date
	 	 	18	 
	 
	 	 	 	 
	11. Full Settlement
	 	 	19	 
	 
	 	 	 	 
	12. No Effect on Other Contractual Rights
	 	 	19	 
	 
	 	 	 	 
	13. Indemnification; Directors and Officers Insurance
	 	 	19	 
	 
	 	 	 	 
	14. Injunctive Relief
	 	 	20	 
	 
	 	 	 	 
	15. Governing Law
	 	 	20	 
	 
	 	 	 	 
	16. Notices
	 	 	20	 
	 
	 	 	 	 
	17. Binding Effect; Assignment; No Third Party Benefit
	 	 	20	 
	 
	 	 	 	 
	18. Miscellaneous
	 	 	21	 
	(a) Amendment
	 	 	21	 
	(b) Waiver
	 	 	21	 
	(c) Withholding Taxes
	 	 	21	 
	(d) Nonalienation of Benefits
	 	 	21	 
	(e) Severability
	 	 	22	 
	(f) Entire Agreement
	 	 	22	 
	(g) Captions
	 	 	22	 
	(h) References
	 	 	22	 






 


ii









 





EMPLOYMENT AGREEMENT




This EMPLOYMENT AGREEMENT (this “Agreement”), dated as of December 30, 2008, by and between
NOBLE DRILLING SERVICES INC., a Delaware corporation (the “Company”), and DAVID W. WILLIAMS (the
“Executive”);



WITNESSETH:




WHEREAS, the Company and the Executive have previously entered into an Employment Agreement
dated October 27, 2006 (the “Current Agreement”); and



WHEREAS, the Board of Directors of the Company (the “Board”) has determined that it is in the
best interests of the Company and its parent company, Noble Corporation (“Noble”), and/or each
other affiliated company (as defined in Paragraph 1 below) to assure that the group will have the
continued dedication of the Executive, notwithstanding the possibility, threat or occurrence of a
Change of Control (as defined in Paragraph 10 below); and



WHEREAS, the Board believes it is imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks created by a pending or threatened
Change of Control and to encourage the Executive’s full attention and dedication to the Company
and/or its affiliated companies currently and in the event of any pending or threatened Change of
Control, and to provide the Executive with compensation and benefits upon a Change of Control which
ensure that the compensation and benefits expectations of the Executive will be satisfied and which
are competitive with those of other corporations; and



WHEREAS, in order to accomplish these objectives and to update the Current Agreement to comply
with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”)
and to make other changes, the Board has caused the Company to amend and restate the Current
Agreement in the form of this Agreement;



NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements
herein contained, and intending to be legally bound hereby, the Company and the Executive hereby
amend the Current Agreement by restatement in its entirety to read as follows:



1. Employment. The Company agrees that the Company or an affiliated company will
continue the Executive in its employ, and the Executive agrees to remain in the employ of the
Company or an affiliated company, for the period set forth in Paragraph 2(a), in the positions and
with the duties and responsibilities set forth in Paragraph 3, and upon the other terms and
conditions herein provided. As used in this Agreement, the term “affiliated company” shall mean any
incorporated or unincorporated trade or business or other entity or person, other than the Company,
that along with the Company is considered a single employer under Section 414(b) or 414(c) of the
Code; provided, however, that (i) in applying Section 1563(a)(1), (2), and (3) of the Code for the
purposes of determining a controlled group of corporations under Section 414(b) of the Code, the
phrase “at least 50 percent” shall be used instead of the phrase “at least 80 percent” in each
place the phrase “at least 80 percent” appears in Section 1563(a)(1), (2), and (3) of the
Code, and (ii) in applying Treas. Reg. section 1.414(c)-2 for the purposes of determining
trades or businesses (whether or not incorporated) that are under common control for the purposes
of Section 414(c) of the Code, the phrase “at least 50 percent” shall be used instead of the phrase
“at least 80 percent” in each place the phrase “at least 80 percent” appears in Treas. Reg. section
1.414(c)-2.


 


 









 






2. Employment Term.



(a) Term. The employment of the Executive by the Company or an affiliated company as
provided in Paragraph 1 shall be for the period commencing on the Effective Date (as defined in
Paragraph 10 below) through and ending on the third anniversary of such date (the “Employment
Term”).



(b) Relationship Prior to Effective Date. The Executive and the Company acknowledge
that, except as may otherwise be provided under any written agreement between the Executive and the
Company other than this Agreement, the employment of the Executive by the Company is “at will” and,
prior to the Effective Date, may be terminated by either the Executive or the Company at any time.
Moreover, if prior to the Effective Date, the Executive’s employment with the Company terminates,
then the Executive shall have no further rights under this Agreement. For purposes of this
Paragraph 2(b) only, the term “Company” shall mean and include the company that employs Executive,
whether Noble Drilling Services Inc. or an affiliated company.




3. Positions and Duties.



(a) During the Employment Term, the Executive’s position (including status, offices, titles
and reporting requirements), duties, functions, responsibilities and authority shall be at least
commensurate in all material respects with the most significant of those held or exercised by or
assigned to the Executive in respect of the Company or any affiliated company at any time during
the 120-day period immediately preceding the Effective Date.



(b) During the Employment Term, the Executive shall devote the Executive’s full time, skill
and attention, and the Executive’s reasonable best efforts, during normal business hours to the
business and affairs of the Company, and in furtherance of the business and affairs of its
affiliated companies, to the extent necessary to discharge faithfully and efficiently the duties
and responsibilities delegated and assigned to the Executive herein or pursuant hereto, except for
usual, ordinary and customary periods of vacation and absence due to illness or other disability;
provided, however, that the Executive may (i) serve on industry-related, civic or charitable boards
or committees, (ii) with the approval of the Board of Directors of Noble (the “Noble Board”), serve
on corporate boards or committees, (iii) deliver lectures, fulfill speaking engagements or teach at
educational institutions, and (iv) manage the Executive’s personal investments, so long as such
activities do not significantly interfere with the performance and fulfillment of the Executive’s
duties and responsibilities as an employee of the Company or an affiliated company in accordance
with this Agreement and, in the case of the activities described in clause (ii) of this proviso,
will not, in the good faith judgment of the Noble Board, constitute an actual or potential conflict
of interest with the business of the Company or an affiliated company. It is expressly understood
and agreed that, to the extent that any such activities have
been conducted by the Executive during the term of the Executive’s employment by the Company
or its affiliated companies prior to the Effective Date consistent with the provisions of this
Paragraph 3(b), the continued conduct of such activities (or of activities similar in nature and
scope thereto) subsequent to the Effective Date shall not thereafter be deemed to interfere with
the performance and fulfillment of the Executive’s duties and responsibilities to the Company and
its affiliated companies.


 


2









 





(c) In connection with the Executive’s employment hereunder, the Executive shall be based at
the location where the Executive was regularly employed immediately prior to the Effective Date or
any office which is the headquarters of the Company or Noble and is less than 50 miles from such
location, subject, however, to required travel on the business of the Company and its affiliated
companies to an extent substantially consistent with the Executive’s business travel obligations
during the three-year period immediately preceding the Effective Date.



(d) All services that the Executive may render to the Company or any of its affiliated
companies in any capacity during the Employment Term shall be deemed to be services required by
this Agreement and consideration for the compensation provided for herein.




4. Compensation and Related Matters.



(a) Base Salary. During the Employment Term, the Executive shall receive an annual
base salary (“Base Salary”) at least equal to 12 times the highest monthly base salary paid or
payable, including any base salary that has been earned but deferred, to the Executive by the
Company and its affiliated companies in respect of the 12-month period immediately preceding the
month in which the Effective Date occurs. The Base Salary shall be payable in installments in
accordance with the general payroll practices of the Company in effect at the time such payment is
made, but in no event less frequently than monthly, or as otherwise mutually agreed upon. During
the Employment Term, the Executive’s Base Salary shall be subject to such increases (but not
decreases) as may be determined from time to time by the Noble Board in its sole discretion;
provided, however, that the Executive’s Base Salary (i) shall be reviewed by the Noble Board no
later than 12 months after the last salary increase awarded to the Executive prior to the Effective
Date and thereafter at least annually, with a view to making such upward adjustment, if any, as the
Noble Board deems appropriate, and (ii) shall be increased at any time and from time to time as
shall be substantially consistent with increases in base salary generally awarded in the ordinary
course of business to the Executive’s peer executives of the Company or any of its affiliated
companies. Base Salary shall not be reduced after any such increase. The term Base Salary as used
in this Agreement shall refer to the Base Salary as so increased. Payments of Base Salary to the
Executive shall not be deemed exclusive and shall not prevent the Executive from participating in
any employee benefit plans, programs or arrangements of the Company and its affiliated companies in
which the Executive is entitled to participate. Payments of Base Salary to the Executive shall not
in any way limit or reduce any other obligation of the Company hereunder, and no other
compensation, benefit or payment to the Executive hereunder shall in any way limit or reduce the
obligation of the Company regarding the Executive’s Base Salary hereunder.


 


3









 





(b) Annual Bonus. In addition to Base Salary, the Executive shall be awarded, in
respect of each fiscal year of the Company ending during the Employment Term, an annual
bonus (the “Annual Bonus”) in cash in an amount at least equal to the Executive’s highest
aggregate bonus under all Company and affiliated company bonus plans, programs, arrangements and
awards (including the Company’s Short-Term Incentive Plan and any successor plan) in respect of any
fiscal year in the three full fiscal year period ended immediately prior to the Effective Date
(annualized for any fiscal year consisting of less than 12 full months or with respect to which the
Executive has been employed by the Company or any of its affiliated companies for less than 12 full
months) (such highest amount is hereinafter referred to as the “Recent Annual Bonus”). Each such
Annual Bonus shall be paid no later than the end of the third month of the fiscal year next
following the fiscal year in respect of which the Annual Bonus is awarded, unless the Executive
shall elect to defer the receipt of such Annual Bonus.




(c) Employee Benefits.




(i) Incentive, Savings and Retirement Plans. During the Employment Term, the
Executive shall be entitled to participate in all incentive, savings and retirement plans,
programs and arrangements applicable generally to the Executive’s peer executives of the
Company and its affiliated companies, but in no event shall such plans, programs and
arrangements provide the Executive with incentive opportunities (measured with respect to
both regular and special incentive opportunities, to the extent, if any, that such
distinction is applicable), savings opportunities and retirement benefit opportunities, in
each case, less favorable, in the aggregate, than the most favorable of those provided by
the Company and its affiliated companies for the Executive under such plans, programs and
arrangements as in effect at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive, those provided generally at any time
after the Effective Date to the Executive’s peer executives of the Company and its
affiliated companies.




(ii) Welfare Benefit Plans. During the Employment Term, the Executive and/or
the Executive’s family, as the case may be, shall be eligible to participate in and shall
receive all benefits under all welfare benefit plans, programs and arrangements provided by
the Company and its affiliated companies (including, without limitation, medical,
prescription, dental, disability, employee life, group life, accidental death and travel
accident insurance plans, programs and arrangements) to the extent applicable generally to
the Executive’s peer executives of the Company and its affiliated companies, but in no event
shall such plans, programs and arrangements provide the Executive with welfare benefits that
are less favorable, in the aggregate, than the most favorable of such plans, programs and
arrangements as in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the Executive, those
provided generally at any time after the Effective Date to the Executive’s peer executives
of the Company and its affiliated companies.



(d) Expenses. During the Employment Term, the Executive shall be entitled to receive
prompt reimbursement for all reasonable expenses incurred by the Executive in performing the
Executive’s duties and responsibilities hereunder in accordance with the most favorable policies,
practices and procedures of the Company and its affiliated companies as in effect for the Executive
at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in effect generally at any time
thereafter with respect to the Executive’s peer executives of the Company and its affiliated
companies.


 


4









 





(e) Fringe Benefits. During the Employment Term, the Executive shall be entitled to
fringe benefits, including, without limitation, tax and financial planning services, payment of
club dues and, if applicable, use of an automobile and payment of related expenses, in accordance
with the most favorable policies, practices and procedures of the Company and its affiliated
companies as in effect for the Executive at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, as in effect generally at any
time after the Effective Date with respect to the Executive’s peer executives of the Company and
its affiliated companies.



(f) Vacation. During the Employment Term, the Executive shall be entitled to paid
vacation and such other paid absences, whether for holidays, illness, personal time or any similar
purposes, in accordance with the most favorable policies, practices and procedures of the Company
and its affiliated companies as in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the Executive, as in effect
generally at any time after the Effective Date with respect to the Executive’s peer executives of
the Company and its affiliated companies.




5. Termination of Employment.



(a) Death. The Executive’s employment shall terminate automatically upon the
Executive’s death during the Employment Term.



(b) Disability. If the Company determines in good faith that the Disability (as
defined below) of the Executive has occurred during the Employment Term, the Company may give the
Executive notice of its intention to terminate the Executive’s employment. In such event, the
Executive’s employment hereunder shall terminate effective on the 30th day after receipt of such
notice by the Executive (the “Disability Effective Date”); provided, that within the 30-day period
after such receipt, the Executive shall not have returned to full-time performance of the
Executive’s duties. For purposes of this Agreement, “Disability” shall mean the absence of the
Executive from the Executive’s duties hereunder on a full-time basis for an aggregate of 180 days
within any given period of 270 consecutive days (in addition to any statutorily required leave of
absence and any leave of absence approved by the Company) as a result of incapacity of the
Executive, despite any reasonable accommodation required by law, due to bodily injury or disease or
any other mental or physical illness, which will, in the opinion of a physician selected by the
Company or its insurers and acceptable to the Executive or the Executive’s legal representative, be
permanent and continuous during the remainder of the Executive’s life.



(c) Termination by Company. The Company may terminate the Executive’s employment
hereunder for Cause. For purposes of this Agreement, “Cause” shall mean:




(i) the willful and continued failure of the Executive to perform substantially the
Executive’s duties hereunder (other than any such failure resulting from bodily injury or
disease or any other incapacity due to mental or physical illness) after a written
demand for substantial performance is delivered to the Executive by the Board or the
Noble Board, or the Chief Executive Officer of the Company or Noble, which specifically
identifies the manner in which the Board or the Noble Board, or the Chief Executive Officer
of the Company or Noble, believes the Executive has not substantially performed the
Executive’s duties; or



(ii) the willful engaging by the Executive in illegal conduct or gross misconduct that
is materially and demonstrably detrimental to the Company and/or its affiliated companies,
monetarily or otherwise.



 


5









 








For purposes of this provision, no act, or failure to act, on the part of the Executive shall be
considered “willful” unless done, or omitted to be done, by the Executive in bad faith or without
reasonable belief that the Executive’s action or omission was in the best interests of Noble. Any
act, or failure to act, based upon authority given pursuant to a resolution duly adopted by the
Board or the Noble Board or upon the instructions of the Chief Executive Officer or another senior
officer of Noble or based upon the advice of counsel for the Company shall be conclusively presumed
to be done, or omitted to be done, by the Executive in good faith and in the best interests of the
Company and its affiliated companies. The cessation of employment of the Executive shall not be
deemed to be for Cause unless and until there shall have been delivered to the Executive a copy of
a resolution duly adopted by the affirmative vote of not less than two-thirds of the entire
membership of the Noble Board then in office at a meeting of the Noble Board called and held for
such purpose (after reasonable notice is provided to the Executive and the Executive is given an
opportunity, together with counsel, to be heard before the Noble Board) finding that, in the good
faith opinion of the Noble Board, the Executive is guilty of the conduct described in subparagraph
(i) or (ii) above, and specifying the particulars thereof in detail.



(d) Termination by Executive. The Executive may terminate the Executive’s employment
hereunder (i) at any time during the Employment Term for Good Reason or (ii) during the Window
Period without any reason. For purposes of this Agreement, the “Window Period” shall mean the
30-day period immediately following the first anniversary of the Effective Date, and “Good Reason”
shall mean any of the following (without the Executive’s express written consent):




(i) the assignment to the Executive of any duties inconsistent in any respect with the
Executive’s position (including status, offices, titles and reporting requirements), duties,
functions, responsibilities or authority as contemplated by Paragraph 3(a) of this
Agreement, or any other action by the Company or Noble that results in a diminution in such
position, duties, functions, responsibilities or authority, excluding for this purpose an
isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied
by the Company or Noble promptly after receipt of notice thereof given by the Executive;




(ii) any failure by the Company to comply with any of the provisions of Paragraph 4 of
this Agreement, other than an isolated, insubstantial and inadvertent action not taken in
bad faith and which is remedied by the Company promptly after receipt of notice thereof
given by the Executive;


 


6









 






(iii) the Company’s requiring the Executive to be based at any office or location other
than as provided in Paragraph 3(c) of this Agreement or the Company’s requiring the
Executive to travel on the Company’s or its affiliated companies’ business to a
substantially greater extent than during the three-year period immediately preceding the
Effective Date;




(iv) any failure by the Company to comply with and satisfy Paragraph 17(c) of this
Agreement; or




(v) any purported termination by the Company of the Executive’s employment hereunder
otherwise than as expressly permitted by this Agreement, and for purposes of this Agreement,
no such purported termination shall be effective.



For purposes of this Paragraph 5(d), any good faith determination of “Good Reason” made by the
Executive shall be conclusive.



(e) Notice of Termination. Any termination of the Executive’s employment hereunder by
the Company or by the Executive (other than a termination pursuant to Paragraph 5(a)) shall be
communicated by a Notice of Termination (as defined below) to the other party hereto. For purposes
of this Agreement, a “Notice of Termination” shall mean a notice which (i) indicates the specific
termination provision in this Agreement relied upon, (ii) in the case of a termination for
Disability, Cause or Good Reason, sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive’s employment under the provision so
indicated, and (iii) specifies the Date of Termination (as defined in Paragraph 5(f) below);
provided, however, that notwithstanding any provision in this Agreement to the contrary, a Notice
of Termination given in connection with a termination for Good Reason shall be given by the
Executive within a reasonable period of time, not to exceed 120 days, following the occurrence of
the event giving rise to such right of termination. The failure by the Company or the Executive to
set forth in the Notice of Termination any fact or circumstance which contributes to a showing of
Disability, Cause or Good Reason shall not waive any right of the Company or the Executive
hereunder or preclude the Company or the Executive from asserting such fact or circumstance in
enforcing the Company’s or the Executive’s rights hereunder.



(f) Date of Termination. For purposes of this Agreement, the “Date of Termination”
shall mean the effective date of the termination of the Executive’s employment hereunder, which
date shall be (i) if the Executive’s employment is terminated by the Executive’s death, the date of
the Executive’s death, (ii) if the Executive’s employment is terminated because of the Executive’s
Disability, the Disability Effective Date, (iii) if the Executive’s employment is terminated by the
Company (or applicable affiliated company) for Cause or by the Executive for Good Reason, the date
on which the Notice of Termination is given, (iv) if the Executive’s employment is terminated
pursuant to Paragraph 2(a), the date on which the Employment Term ends pursuant to Paragraph 2(a)
due to a party’s delivery of a Notice of Termination thereunder, and (v) if the Executive’s
employment is terminated for any other reason, the date specified in the Notice of Termination,
which date shall in no event be earlier than the date such notice is given; provided, however, that
if within 30 days after any Notice of Termination is given, the party receiving such Notice of
Termination notifies the other party that a dispute exists concerning the termination, the Date of
Termination shall be the date on which the dispute is
finally determined, either by mutual written agreement of the parties or by a final judgment,
order or decree of a court of competent jurisdiction (the time for appeal therefrom having expired
and no appeal having been perfected).


 


7









 






6. Obligations of the Company upon Separation from Service.



(a) Good Reason or During the Window Period; Other Than for Cause, Death or
Disability. Subject to the provisions of Paragraph 6(e) of this Agreement, if prior to the end
of the Employment Term the Executive’s Separation from Service (as defined in Paragraph 10 below)
shall occur (i) by reason of the Company’s termination of the Executive’s employment hereunder
other than for Cause or Disability, or (ii) by reason of the Executive’s termination of the
Executive’s employment hereunder either for Good Reason or without any reason during the Window
Period, the Company shall pay to the Executive when due under the Company’s normal payroll
practices the Executive’s Base Salary through the Separation Date (as defined in Paragraph 10
below) to the extent not theretofore paid, and:




(i) the Company shall pay to the Executive within 30 days after the Executive’s
Separation Date a lump sum payment in cash equal to the sum of the following amounts:




(A) the sum of (1) the product of (x) the greater of (I) the Recent Annual
Bonus and (II) the Annual Bonus paid or payable, including by reason of any
deferral, to the Executive (and annualized for any fiscal year consisting of less
than 12 full months or for which the Executive has been employed by the Company or
any of its affiliated companies for less than 12 full months) in respect of the most
recently completed fiscal year of the Company during the Employment Term, if any;
provided that, in any case, the minimum amount determinable under this clause (II)
shall be an amount equal to the bonus that would have been payable to the Executive
under the Company’s Short-Term Incentive Plan and any successor plan for the most
recently ended full fiscal year period immediately prior to the Effective Date
assuming the Executive had been eligible to receive a bonus thereunder for such
period (such greater amount hereinafter referred to as the “Highest Annual Bonus”),
and (y) a fraction, the numerator of which is the number of days in the current
fiscal year through the Separation Date, and the denominator of which is 365, and
(2) an amount equal to the sum of (x) 18 multiplied by the amount of the highest
monthly premium for COBRA continuation coverage (within the meaning of Section 4980B
of the Code) under the group health plan of the Company and its affiliated companies
as in effect and applicable generally to the Executive’s peer executives of the
Company and its affiliated companies during the 12-month period immediately
preceding the Executive’s Separation Date, and (y) any accrued vacation pay to the
extent not theretofore paid (the sum of the amounts described in clauses (1) and (2)
are hereinafter referred to as the “Accrued Obligations”); and




(B) an amount (such amount is hereinafter referred to as the “Severance
Amount”) equal to the product of (1) three and (2) the sum of (x) the Executive’s
Base Salary and (y) the Highest Annual Bonus; and


 


8









 






(C) a separate lump-sum supplemental retirement benefit (the amount of such
benefit hereinafter referred to as the “Supplemental Retirement Amount”) equal to
the difference between (1) the actuarial equivalent (utilizing for this purpose the
actuarial assumptions utilized with respect to the qualified defined benefit
retirement plan of the Company and its affiliated companies in which the Executive
is eligible to participate (or any successor plan thereto) (the “Retirement Plan”)
during the 120-day period immediately preceding the Effective Date) of the benefit
payable under the Retirement Plan and any supplemental and/or excess retirement plan
of the Company and its affiliated companies providing benefits for the Executive
(the “SERP”) which the Executive would receive if the Executive’s employment
continued at the compensation level provided for in Paragraphs 4(a) and 4(b)(i) for
the remainder of the Employment Term, assuming for this purpose that all accrued
benefits are fully vested and that benefit accrual formulas are no less advantageous
to the Executive than those in effect during the 120-day period immediately
preceding the Effective Date, and (2) the actuarial equivalent (utilizing for this
purpose the actuarial assumptions utilized with respect to the Retirement Plan
during the 120-day period immediately preceding the Effective Date) of the
Executive’s actual benefit (paid or payable), if any, under the Retirement Plan and
the SERP; and




(ii) for eighteen months after the Executive’s Separation Date, the Company shall
continue benefits to the Executive and/or the Executive’s family at least equal to those
that would have been provided to them in accordance with the plans, programs and
arrangements described in Paragraph 4(c)(ii) if the Executive’s employment hereunder was
continuing, in accordance with the most favorable plans, programs and arrangements of the
Company and its affiliated companies as in effect and applicable generally to the
Executive’s peer executives of the Company and its affiliated companies and their families
during the 120-day period immediately preceding the Effective Date or, if more favorable to
the Executive, as in effect generally at any time thereafter with respect to the Executive’s
peer executives of the Company and its affiliated companies and their families; provided,
however, that if the Executive becomes reemployed with another employer and is eligible to
receive medical or other welfare benefits under another employer provided plan, the medical
and other welfare benefits described herein shall be secondary to those provided under such
other plan during such applicable period of eligibility (such continuation of such benefits
for the applicable period herein set forth is hereinafter referred to as “Welfare Benefit
Continuation”) (for purpose of determining eligibility of the Executive for retiree benefits
pursuant to such plans, programs and arrangements, the Executive shall be considered to have
remained employed hereunder until three years after the Separation Date and to have retired
on the last day of such period); and




(iii) for six months following the Executive’s Separation Date, the Company shall, at
its sole expense as incurred, provide the Executive with outplacement services the scope and
provider of which shall be selected by the Executive in the Executive’s sole discretion;
provided, however, that (A) an expense for such outplacement services shall be paid by the
Company or reimbursed by the Company to the Executive as soon as practicable after such
expense is incurred (but in no event later than 30 days after such
expense is incurred), and (B) the total amount of the expenses paid or reimbursed by
the Company pursuant to this Paragraph 6(a)(iii) shall not exceed $50,000; and


 


9









 






(iv) with respect to all options to purchase Ordinary Shares, par value US$.10 per
share, of Noble (“Ordinary Shares”) held by the Executive pursuant to a Noble option plan on
or immediately prior to the Executive’s Separation Date (irrespective of whether such
options are then exercisable), the Executive shall have the right, during the 60-day period
after the Executive’s Separation Date, to elect to surrender all or part of such options (to
the extent still then outstanding and in effect) in exchange for a cash payment by the
Company to the Executive in an amount equal to the number of Ordinary Shares subject to the
Executive’s surrendered option multiplied by the excess of (x) over (y), where (x) equals
the average of the reported high and low sale price of an Ordinary Share on the date of
Executive’s election to surrender such option hereunder as reported on the New York Stock
Exchange and (y) equals the purchase price per share covered by the option. Such cash
payment shall be made within 30 days after the date of the Executive’s election (but in no
event later than the last day of the Executive’s federal income tax taxable year during
which such election was made).




(v) no later than 90 days after Executive’s Separation Date, all club memberships and
other memberships that the Company was providing for the Executive’s use at the earlier of
the Executive’s Separation Date or the time Notice of Termination is given shall, to the
extent possible, be transferred and assigned to the Executive at no cost to the Executive
(other than income taxes owed), the cost of transfer, if any, to be borne by the Company;
and




(vi) all benefits under the Noble Corporation 1991 Stock Option and Restricted Stock
Plan and any other similar plans, including any stock options or restricted stock held by
the Executive, not already vested shall be 100% vested, to the extent such vesting is
permitted under the U.S. Internal Revenue Code (the “Code”); and




(vii) to the extent not theretofore paid or provided, the Company shall timely pay or
provide to the Executive when otherwise due any other amounts or benefits required to be
paid or provided or which the Executive is eligible to receive under any plan, program,
policy, practice or arrangement or contract or agreement of the Company and its affiliated
companies (such other amounts and benefits hereinafter referred to as the “Other Benefits”).



(b) Death. If the Executive’s Separation from Service occurs by reason of the
Executive’s death, this Agreement shall terminate without further obligations to the Executive’s
legal representatives under this Agreement, other than for (i) payment of Accrued Obligations
(which shall be paid to the Executive’s estate or beneficiary, as applicable, in a lump sum in cash
within 30 days after the Executive’s Separation Date) and the timely payment or provision of the
Welfare Benefit Continuation and the Other Benefits and (ii) payment to the Executive’s estate or
beneficiaries, as applicable, in a lump sum in cash within 30 days after the Executive’s Separation
Date of an amount equal to the sum of the Severance Amount and the Supplemental Retirement Amount.
With respect to the provision of Other Benefits, the term “Other Benefits” as used in this
Paragraph 6(b) shall include, without limitation, and the Executive’s estate and/or
beneficiaries shall be entitled to receive, death benefits at least equal to the most
favorable benefits provided by the Company and its affiliated companies to the estates and
beneficiaries of the Executive’s peer executives of the Company and such affiliated companies under
such plans, programs, practices and policies relating to death benefits, if any, as in effect with
respect to the peer executives and their beneficiaries at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the Executive’s estate and/or the
Executive’s beneficiaries, as in effect on the date of the Executive’s death with respect to other
of the Executive’s peer executives of the Company and its affiliated companies and their
beneficiaries.


 


10









 





(c) Disability. Subject to the provisions of Paragraph 6(e) of this Agreement, if the
Executive’s Separation from Service occurs by reason of the Executive’s Disability, this Agreement
shall terminate without further obligations to the Executive, other than for (i) payment of the
Accrued Obligations, the Severance Amount and the Supplemental Retirement Amount (each of which
shall be paid to the Executive in a lump sum in cash within 30 days after the Executive’s
Separation Date), (ii) the timely payment or provision of the Other Benefits, and (iii) the timely
payment or provision of the Welfare Benefit Continuation. With respect to the provision of Other
Benefits, the term “Other Benefits” as used in this Paragraph 6(c) shall include, without
limitation, and the Executive shall be entitled upon Separation from Service to receive, disability
benefits at least equal to the most favorable of those generally provided by the Company and its
affiliated companies to disabled executives and/or their families in accordance with such plans,
programs, practices and policies relating to disability, if any, as in effect generally with
respect to other of the Executive’s peer executives of the Company and their families at any time
during the 120-day period immediately preceding the Effective Date or, if more favorable to the
Executive and/or the Executive’s family, as in effect at any time thereafter generally with respect
to other of the Executive’s peer executives of the Company and its affiliated companies and their
families.




(d) Cause; Other than for Good Reason or During the Window Period.




(i) If the Executive’s Separation from Service occurs by reason of the Company’s
termination of Executive’s employment hereunder for Cause, this Agreement shall terminate
without further obligations to the Executive hereunder other than the obligation to pay the
Executive’s Base Salary through the Executive’s Separation Date and the timely payment or
provision of deferred compensation and other employee benefits if and when otherwise due.




(ii) If the Executive’s Separation from Service occurs by reason of the Executive’s
voluntary termination of the Executive’s employment hereunder, excluding a termination of
such employment by the Executive either for Good Reason or without any reason during the
Window Period, this Agreement shall terminate without further obligations to the Executive
hereunder other than for (1) the payment of the Executive’s Base Salary through the
Executive’s Separation Date to the extent not theretofore paid, (2) the payment of the
Accrued Obligations (which, subject to the provisions of Paragraph 6(e) of this Agreement,
shall be paid to the Executive in a lump sum in cash within 30 days after the Executive’s
Separation Date), and (3) the timely payment or
provision of deferred compensation and other employee benefits if and when otherwise
due.


 


11









 





(e) Payment Delay for Specified Employee. Any provision of this Agreement to the
contrary notwithstanding, if the Executive is a Specified Employee (as defined in Paragraph 10
below) on the Executive’s Separation Date, then any payment or benefit to be paid, transferred or
provided to the Executive pursuant to the provisions of this Agreement that would be subject to the
tax imposed by Section 409A of the Code if paid, transferred or provided at the time otherwise
specified in this Agreement shall be delayed and thereafter paid, transferred or provided on the
first business day that is 6 months after the Executive’s Separation Date (or if earlier, within 30
days after the date of the Executive’s death following the Executive’s Separation from Service) to
the extent necessary for such payment or benefit to avoid being subject to the tax imposed by
Section 409A of the Code.




7. Certain Additional Payments by the Company.



(a) Notwithstanding any provision in this Agreement to the contrary and except as set forth
below, if it shall be determined that any payment or distribution by the Company to or for the
benefit of the Executive (whether paid or payable or distributed or distributable pursuant to the
terms of this Agreement or otherwise, but determined without regard to any additional payments
required pursuant to this Paragraph 7) (a “Payment”) would be subject to the excise tax imposed by
Section 4999 of the Code or any interest or penalties are incurred by the Executive with respect to
such excise tax (such excise tax, together with any such interest and penalties, are hereinafter
collectively referred to as the “Excise Tax”), then the Executive shall be entitled to receive an
additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of
all taxes (including any interest or penalties imposed with respect to such taxes), including any
income taxes (and any interest and penalties imposed with respect thereto) and Excise Tax imposed
upon the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment equal to the
Excise Tax imposed upon the Payments. Notwithstanding the foregoing provisions of this Paragraph
7(a), if it shall be determined that the Executive is entitled to a Gross-Up Payment, but that the
Executive, after taking into account the Payments and the Gross-Up Payment, would not receive a net
after-tax benefit of at least $50,000 (taking into account both income taxes and any Excise Tax) as
compared to the net after-tax proceeds to the Executive resulting from an elimination of the
Gross-Up Payment and a reduction of the Payments, in the aggregate, to an amount (the “Reduced
Amount”) such that the receipt of payments would not give rise to any Excise Tax, then no Gross-Up
Payment shall be made to the Executive and the Payments, in the aggregate, shall be reduced to the
Reduced Amount.



(b) Subject to the provisions of Paragraph 7(c), all determinations required to be made under
this Paragraph 7, including whether and when a Gross-Up Payment is required and the amount of such
Gross-Up Payment and the assumptions to be utilized in arriving at such determination, shall be
made by PricewaterhouseCoopers LLP (the “Accounting Firm”) or, as provided below, such other
certified public accounting firm as may be designated by the Executive, which shall provide
detailed supporting calculations both to the Company and the Executive within 15 business days
after the receipt of notice from the Executive that there has been a Payment, or such earlier time
as is requested by the Company. If the Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change of
Control, the Executive shall have the option, in the Executive’s sole discretion, to appoint
another nationally recognized accounting firm to make the determinations required hereunder (which
accounting firm shall then be referred to as the “Accounting Firm” hereunder). All fees and
expenses of the Accounting Firm shall be borne solely by the Company. Any Gross-Up Payment, as
determined pursuant to this Paragraph 7, shall be paid by the Company to the Executive within five
days of the receipt of the Accounting Firm’s determination. If the Accounting Firm determines that
no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion
that failure to report the Excise Tax on the Executive’s applicable federal income tax return would
not result in the imposition of a negligence or similar penalty. Any determination by the
Accounting Firm shall be binding upon the Company and the Executive. As a result of the uncertainty
in the application of Section 4999 of the Code at the time of the initial determination by the
Accounting Firm hereunder, it is possible that Gross-Up Payments that will not have been made by
the Company should have been made (“Underpayment”), consistent with the calculations required to be
made hereunder. If the Company exhausts its remedies pursuant to Paragraph 7(c) and the Executive
thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the
amount of the Underpayment that has occurred and any such Underpayment shall be promptly paid by
the Company to or for the benefit of the Executive.


 


12









 





(c) The Executive shall notify the Company in writing of any claim by the Internal Revenue
Service of the United States (the “Internal Revenue Service”) that, if successful, would require
the payment by the Company of the Gross-Up Payment (or an additional amount of Gross-Up Payment) in
the event the Internal Revenue Service seeks higher payment. Such notification shall be given as
soon as practicable but no later than 10 business days after the Executive is informed in writing
of such claim and shall apprise the Company of the nature of such claim and the date on which such
claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of
the 30-day period following the date on which it gives such notice to the Company (or such shorter
period ending on the date that any payment of taxes with respect to such claim is due). If the
Company notifies the Executive in writing prior to the expiration of such period that it desires to
contest such claim, the Executive shall:




(i) give the Company any information reasonably requested by the Company relating to
such claim;




(ii) take such action in connection with contesting such claim as the Company shall
reasonably request in writing from time to time, including the acceptance of legal
representation with respect to such claim by an attorney reasonably selected by the Company;




(iii) cooperate with the Company in good faith in order effectively to contest such
claim; and




(iv) permit the Company and/or Noble to participate in any proceedings relating to such
claim;



provided, however, that the Company shall bear and pay directly all costs and expenses (including
additional interest and penalties) incurred in connection with such contest and shall
indemnify and hold the Executive harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto) imposed as a result of such representation
and payment of costs and expenses. Without limitation of the foregoing provisions of this
Paragraph 7(c), the Company shall control all proceedings taken in connection with such contest
and, at its sole option, may pursue or forgo any and all administrative appeals, proceedings,
hearings and conferences with the taxing authority in respect of such claim and may, at its sole
option, either direct the Executive to pay the tax claimed and sue for a refund or contest the
claim in any permissible manner, and the Executive agrees to prosecute such contest to a
determination before any administrative tribunal, in a court of initial jurisdiction, and in one or
more appellate courts, as the Company shall determine; provided, however, that if the Company
directs the Executive to pay such claim and sue for a refund, the Company shall advance the amount
of such payment to the Executive, on an interest-free basis, and shall indemnify and hold the
Executive harmless, on an after-tax basis, from any Excise Tax or income tax (including interest or
penalties with respect thereto) imposed with respect to such advance or with respect to any imputed
income with respect to such advance; and provided further, that any extension of the statute of
limitations relating to payment of taxes for the taxable year of the Executive with respect to
which such contested amount is claimed to be due is limited solely to such contested amount.
Furthermore, the Company’s control of the contest shall be limited to issues with respect to which
a Gross-Up Payment would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue Service or any other
taxing authority.


 


13









 





(d) If, after the receipt by the Executive of an amount advanced by the Company pursuant to
Paragraph 7(c), the Executive becomes entitled to receive any refund with respect to such claim,
the Executive shall (subject to the Company’s complying with the requirements of Paragraph 7(c))
pay the amount of such refund to the Company within 30 days of the receipt thereof by the Executive
(together with any interest paid or credited thereon after taxes applicable thereto). If, after
the receipt by the Executive of an amount advanced by the Company pursuant to Paragraph 7(c), a
determination is made that the Executive shall not be entitled to any refund with respect to such
claim and the Company does not notify the Executive in writing of its intent to contest such denial
of refund prior to the expiration of 30 days after such determination, then such advance shall be
forgiven and shall not be required to be repaid and the amount of such advance shall offset, to the
extent thereof, the amount of Gross-Up Payment required to be paid.



(e) Unless sooner paid pursuant to the foregoing provisions of this Paragraph 7, (i) any tax
gross-up payment (within the meaning of Treas. Reg. section 1.409A-3(i)(1)(v)) to be paid to or for
the benefit of the Executive pursuant to this Paragraph 7 shall be paid no later than the end of
the Executive’s taxable year that immediately follows the taxable year of the Executive in which
the Executive remits the related taxes, and (ii) any amount to be paid to or for the benefit of the
Executive pursuant to this Paragraph 7 for expenses incurred due to a tax audit or litigation
addressing the existence or the amount of a tax liability referred to in this Paragraph 7 shall be
paid no later than the end of the Executive’s taxable year that immediately follows the taxable
year of the Executive in which the taxes that are the subject matter of the audit or litigation are
remitted to the taxing authority, or where as a result of such audit or litigation no taxes are
remitted, the end of the Executive’s taxable year that immediately follows
the taxable year of the Executive in which the audit is completed or there is a final and
non-appealable settlement or other resolution of the litigation.


 


14









 






8. Representations and Warranties.



(a) The Company represents and warrants to the Executive that the execution, delivery and
performance by the Company of this Agreement have been duly authorized by all necessary corporate
action of the Company and do not and will not conflict with or result in a violation of any
provision of, or constitute a default under, any contract, agreement, instrument or obligation to
which the Company is a party or by which it is bound.



(b) The Executive represents and warrants to the Company that the execution, delivery and
performance by the Executive of this Agreement do not and will not conflict with or result in a
violation of any provision of, or constitute a default under, any contract, agreement, instrument
or obligation to which the Executive is a party or by which the Executive is bound.



9. Confidential Information. The Executive recognizes and acknowledges that the
Company’s and its affiliated companies’ trade secrets and other confidential or proprietary
information, as they may exist from time to time, are valuable, special and unique assets of the
Company’s and/or such affiliated companies’ business, access to and knowledge of which are
essential to the performance of the Executive’s duties hereunder. The Executive confirms that all
such trade secrets and other information constitute the exclusive property of the Company and/or
such affiliated companies. During the Employment Term and thereafter without limitation of time,
the Executive shall hold in strict confidence and shall not, directly or indirectly, disclose or
reveal to any person, or use for the Executive’s own personal benefit or for the benefit of anyone
else, any trade secrets, confidential dealings or other confidential or proprietary information of
any kind, nature or description (whether or not acquired, learned, obtained or developed by the
Executive alone or in conjunction with others) belonging to or concerning the Company or any of its
affiliated companies, except (i) with the prior written consent of the Company duly authorized by
its Board, (ii) in the course of the proper performance of the Executive’s duties hereunder, (iii)
for information (x) that becomes generally available to the public other than as a result of
unauthorized disclosure by the Executive or the Executive’s affiliates or (y) that becomes
available to the Executive on a nonconfidential basis from a source other than the Company or its
affiliated companies who is not bound by a duty of confidentiality, or other contractual, legal or
fiduciary obligation, to the Company, or (iv) as required by applicable law or legal process. The
provisions of this Paragraph 9 shall continue in effect notwithstanding termination of the
Executive’s employment hereunder for any reason.




10. Certain Definitions.



(a) Effective Date. For purposes of this Agreement, “Effective Date” shall mean the
first date during the Change of Control Period (as defined in Paragraph 10 below) on which a Change
of Control occurs. Notwithstanding anything in this Agreement to the contrary, if a Change of
Control occurs and if the Executive’s Separation from Service occurs prior to the date on which the
Change of Control occurs, and if it is reasonably demonstrated by the Executive that such
Separation from Service (i) was at the request of a third party who has taken steps reasonably
calculated to effect a Change of Control or (ii) otherwise arose in connection with or
anticipation of a Change of Control, then for all purposes of this Agreement the “Effective
Date” shall mean the date immediately prior to the date of such Separation from Service.


 


15









 





(b) Change of Control Period. For purposes of this Agreement, “Change of Control
Period” shall mean the period commencing on the date of this Agreement and ending on the third
anniversary of such date; provided, however, that commencing on the date one year after the date
hereof, and on each annual anniversary of such date (such date and each annual anniversary thereof
herein referred to as the “Renewal Date”), the Change of Control Period shall be automatically
extended so as to terminate three years after such Renewal Date, unless at least 60 days prior to
the Renewal Date the Company shall give notice to the Executive that the Change of Control Period
shall not be so extended.



(c) Change of Control. For purposes of this Agreement, “Change of Control” shall
mean:




(i) the acquisition by any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act) (a “Person”) of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 15% or more of either (A) the
then outstanding Ordinary Shares of Noble (the “Outstanding Parent Shares”) or (B) the
combined voting power of the then outstanding voting securities of Noble entitled to vote
generally in the election of directors (the “Outstanding Parent Voting Securities”);
provided, however, that for purposes of this subparagraph (c)(i) the following acquisitions
shall not constitute a Change of Control: (w) any acquisition directly from Noble (excluding
an acquisition by virtue of the exercise of a conversion privilege), (x) any acquisition by
Noble, (y) any acquisition by any employee benefit plan (or related trust) sponsored or
maintained by Noble or any company controlled by Noble, or (z) any acquisition by any
corporation pursuant to a reorganization, merger, amalgamation or consolidation, if,
following such reorganization, merger, amalgamation or consolidation, the conditions
described in clauses (A), (B) and (C) of subparagraph (iii) of this Paragraph 10(c) are
satisfied; or




(ii) individuals who, as of the date of this Agreement, constitute the Noble Board (the
“Incumbent Board”) cease for any reason to constitute a majority of such Board of Directors;
provided, however, that any individual becoming a director of Noble subsequent to the date
hereof whose election, or nomination for election by Noble’s Members, was approved by a vote
of a majority of the directors of Noble then comprising the Incumbent Board shall 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 or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the Noble Board;
or


 


16









 






(iii) consummation of a reorganization, merger, amalgamation or consolidation of Noble,
with or without approval by the Members of Noble, in each case, unless, following such
reorganization, merger, amalgamation or consolidation, (A) more than 50% of, respectively,
the then outstanding shares of common stock (or equivalent security) of the company
resulting from such reorganization, merger, amalgamation or
consolidation and the combined voting power of the then outstanding voting securities
of such company 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 Parent Shares and
Outstanding Parent Voting Securities immediately prior to such reorganization, merger,
amalgamation or consolidation in substantially the same proportions as their ownership,
immediately prior to such reorganization, merger, amalgamation or consolidation, of the
Outstanding Parent Shares and Outstanding Parent Voting Securities, as the case may be, (B)
no Person (excluding Noble, any employee benefit plan (or related trust) of Noble or such
company resulting from such reorganization, merger, amalgamation or consolidation, and any
Person beneficially owning, immediately prior to such reorganization, merger, amalgamation
or consolidation, directly or indirectly, 15% or more of the Outstanding Parent Shares or
Outstanding Parent Voting Securities, as the case may be) beneficially owns, directly or
indirectly, 15% or more of, respectively, the then outstanding shares of common stock (or
equivalent security) of the company resulting from such reorganization, merger, amalgamation
or consolidation or the combined voting power of the then outstanding voting securities of
such company entitled to vote generally in the election of directors, and (C) a majority of
the members of the board of directors of the company resulting from such reorganization,
merger, amalgamation or consolidation were members of the Incumbent Board at the time of the
execution of the initial agreement providing for such reorganization, merger, amalgamation
or consolidation; or




(iv) consummation of a sale or other disposition of all or substantially all the assets
of Noble, with or without approval by the Members of Noble, other than to a corporation,
with respect to which following such sale or other disposition, (A) more than 50% of,
respectively, the then outstanding shares of common stock (or equivalent security) of such
corporation and the combined voting power of the then outstanding voting securities of such
corporation entitled to vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Parent Shares and Outstanding
Parent Voting Securities immediately prior to such sale or other disposition in
substantially the same proportion as their ownership, immediately prior to such sale or
other disposition, of the Outstanding Parent Shares and Outstanding Parent Voting
Securities, as the case may be, (B) no Person (excluding Noble, any employee benefit plan
(or related trust) of Noble or such corporation, and any Person beneficially owning,
immediately prior to such sale or other disposition, directly or indirectly, 15% or more of
the Outstanding Parent Shares or Outstanding Parent Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 15% or more of, respectively, the then
outstanding shares of common stock (or equivalent security) of such corporation or the
combined voting power of the then outstanding voting securities of such corporation entitled
to vote generally in the election of directors, and (C) 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 Noble Board providing for such sale
or other disposition of assets of Noble; or


(v) approval by the Members of Noble of a complete liquidation or dissolution of Noble.



 


17









 







Notwithstanding the foregoing, or anything to the contrary set forth herein, a transaction or
series of related transactions will not be considered to be a Change of Control if (i) Noble
becomes a direct or indirect wholly owned subsidiary of a holding company and (ii) (A) immediately
following such transaction(s), the then outstanding shares of common stock (or equivalent security)
of such holding company and the combined voting power of the then outstanding voting securities of
such holding company entitled to vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all the individuals and entities who were
the beneficial owners, respectively, of the Outstanding Parent Shares and Outstanding Parent Voting
Securities immediately prior to such transaction(s) in substantially the same proportion as their
ownership immediately prior to such transaction(s) of the Outstanding Parent Shares and Outstanding
Parent Voting Securities, as the case may be, or (B) the shares of Outstanding Parent Voting
Securities outstanding immediately prior to such transaction(s) constitute, or are converted into
or exchanged for, a majority of the outstanding voting securities of such holding company
immediately after giving effect to such transaction(s).



(d) Separation from Service. For purposes of this Agreement, “Separation from
Service” shall mean the Executive’s separation from service (within the meaning of Section 409A of
the Code and the regulations and other guidance promulgated thereunder) with the group of employers
that includes the Company and each affiliated company. For this purpose, with respect to services
as an employee, an employee’s Separation from Service shall occur on the date as of which the
employee and his or her employer reasonably anticipate that no further services will be performed
after such date or that the level of bona fide services the employee will perform after such date
(whether as an employee or an independent contractor) will permanently decrease to no more than 20%
of the average level of bona fide services performed (whether as an employee or an independent
contractor) over the immediately preceding 36-month period (or the full period of services to the
employer if the employee has been providing services to the employer less than 36 months).



(e) Specified Employee. For purposes of this Agreement, “Specified Employee” shall
mean a specified employee within the meaning of Section 409A(a)(2) of the Code and the regulations
and other guidance promulgated thereunder. Each Specified Employee will be identified by the Chief
Executive Officer of Noble on each December 31, using such definition of compensation permissible
under Treas. Reg. section 1.409A-1(i)(2) as said Chief Executive Officer shall determine in his or
her discretion, and each Specified Employee so identified shall be treated as a Specified Employee
for the purposes of this Agreement for the entire 12-month period beginning on the April 1
following a December 31 Specified Employee identification date.



(f) Separation Date. For purposes of this Agreement, “Separation Date” shall mean the
date on which the Executive’s Separation from Service occurs.


 


18









 






11. Full Settlement.



(a) There shall be no right of set off or counterclaim against, or delay in, any payments to
the Executive, or to the Executive’s heirs or legal representatives, provided for in this
Agreement, in respect of any claim against or debt or other obligation of the Executive or others,
whether arising hereunder or otherwise.



(b) In no event shall the Executive be obligated to seek other employment or take any other
action by way of mitigation of the amounts payable to the Executive under any of the provisions of
this Agreement, and such amounts shall not be reduced whether or not the Executive obtains other
employment.



(c) The Company agrees to pay as incurred, to the full extent permitted by law, all costs and
expenses (including attorneys’ fees) that the Executive, or the Executive’s heirs or legal
representatives, may reasonably incur as a result of any contest (regardless of the outcome
thereof) by the Company, the Executive or others of the validity or enforceability of, or liability
under, any provision of this Agreement, or any guarantee of performance thereof (including as a
result of any contest by the Executive, or the Executive’s heirs or legal representatives, about
the amount of any payment pursuant to this Agreement), plus in each case interest on any delayed
payment at the applicable federal rate provided for in Section 7872(f)(2) of the Code. The amounts
payable by the Company pursuant to this Paragraph 11(c) shall be paid as soon as practicable after
such costs and expenses are incurred, but in no event later than the end of the taxable year of the
Executive that immediately follows the taxable year of the Executive in which such costs and
expenses were incurred.



12. No Effect on Other Contractual Rights. The provisions of this Agreement, and any
payment provided for hereunder, shall not reduce any amounts otherwise payable to the Executive, or
in any way diminish the Executive’s rights as an employee of the Company or any of its affiliated
companies, whether existing on the date of this Agreement or hereafter, under any employee benefit
plan, program or arrangement or other contract or agreement of the Company or any of its affiliated
companies providing benefits to the Executive.



13. Indemnification; Directors and Officers Insurance. The Company shall (a) during
the Employment Term and thereafter without limitation of time, indemnify and advance expenses to
the Executive to the fullest extent permitted by the laws of the State of Delaware from time to
time in effect and (b) ensure that during the Employment Term, Noble acquires and maintains
directors and officers liability insurance covering the Executive (and to the extent Noble desires,
other directors and officers of Noble and/or the Company and its affiliated companies) to the
extent it is available at commercially reasonable rates as determined by the Noble Board; provided,
however, that in no event shall the Executive be entitled to indemnification or advancement of
expenses under this Paragraph 13 with respect to any proceeding or matter therein brought or made
by the Executive against the Company or Noble other than one initiated by the Executive to enforce
the Executive’s rights under this Paragraph 13. The rights of indemnification and to receive
advancement of expenses as provided in this Paragraph 13 shall not be deemed exclusive of any other
rights to which the Executive may at any time be entitled under applicable law, the Certificate of
Incorporation or Bylaws of the Company, the Articles of Association of Noble, any agreement, a vote
of shareholders or
members, a resolution of the Board or the Noble Board, or otherwise. The provisions of this
Paragraph 13 shall continue in effect notwithstanding termination of the Executive’s employment
hereunder for any reason.


 


19









 





14. Injunctive Relief. In recognition of the fact that a breach by the Executive of
any of the provisions of Paragraph 9 will cause irreparable damage to the Company and/or its
affiliated companies for which monetary damages alone will not constitute an adequate remedy, the
Company shall be entitled as a matter of right (without being required to prove damages or furnish
any bond or other security) to obtain a restraining order, an injunction, an order of specific
performance, or other equitable or extraordinary relief from any court of competent jurisdiction
restraining any further violation of such provisions by the Executive or requiring the Executive to
perform the Executive’s obligations hereunder. Such right to equitable or extraordinary relief
shall not be exclusive but shall be in addition to all other rights and remedies to which the
Company or any of its affiliated companies may be entitled at law or in equity, including without
limitation the right to recover monetary damages for the breach by the Executive of any of the
provisions of this Agreement.



15. Governing Law. This Agreement shall be governed by and construed and enforced in
accordance with the laws of the State of Texas, without regard to the principles of conflicts of
laws thereof.



16. Notices. All notices, requests, demands and other communications required or
permitted to be given or made hereunder by either party hereto shall be in writing and shall be
deemed to have been duly given or made (i) when delivered personally, (ii) when sent by
telefacsimile transmission, or (iii) five days after being deposited in the United States mail,
first class registered or certified mail, postage prepaid, return receipt requested, to the party
for which intended at the following addresses (or at such other addresses as shall be specified by
the parties by like notice, except that notices of change of address shall be effective only upon
receipt):



	 	 	 	 	 
	 

	 	If to the Company, at:
	 	Noble Drilling Services Inc.
	 

	 	 	 	13135 South Dairy Ashford, Suite 800
	 

	 	 	 	Sugar Land, Texas 77478
	 

	 	 	 	Fax No.: (281) 491-2092
	 

	 	 	 	Attention: Chief Executive Officer
	 
	 	 	 	 
	 

	 	If to the Executive, at:
	 	David W. Williams
	 

	 	 	 	Noble Drilling Services Inc.
	 

	 	 	 	13135 South Dairy Ashford, Suite 800
	 

	 	 	 	Sugar Land, Texas 77478
	 

	 	 	 	Fax No.: (281) 491-2092







17. Binding Effect; Assignment; No Third Party Benefit.



(a) This Agreement is personal to the Executive and without the prior written consent of the
Company shall not be assignable by the Executive otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and shall be enforceable by the
Executive’s legal representatives.


 


20









 





(b) This Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns.



(c) The Company shall require any successor or assign (whether direct or indirect, by
purchase, merger, consolidation, amalgamation or otherwise) to all or substantially all the
business and/or assets of the Company, by agreement in writing in form and substance reasonably
satisfactory to the Executive, expressly, absolutely and unconditionally to assume and agree to
perform this Agreement in the same manner and to the same extent that the Company would be required
to perform it if no such succession or assignment had taken place. As used in this Agreement, the
“Company” shall mean the Company as hereinbefore defined and any successor or assign to the
business and/or assets of the Company as aforesaid which executes and delivers the agreement
provided for in this Paragraph 17(c) or which otherwise becomes bound by all the terms and
provisions of this Agreement by operation of law. The Company shall require that the guaranty of
Noble of the obligations of the Company under this Agreement shall contain a similar provision
regarding any successor or assign of Noble.



(d) Nothing in this Agreement, express or implied, is intended to or shall confer upon any
person other than the parties hereto and Noble, and their respective heirs, legal representatives,
successors and permitted assigns, any rights, benefits or remedies of any nature whatsoever under
or by reason of this Agreement.




18. Miscellaneous.



(a) Amendment. This Agreement may not be modified or amended in any respect except by
an instrument in writing signed by the party against whom such modification or amendment is sought
to be enforced. No person, other than pursuant to a resolution of the Board or a committee
thereof, which resolution is approved by the Noble Board or a committee thereof, shall have
authority on behalf of the Company to agree to modify, amend or waive any provision of this
Agreement or anything in reference thereto.



(b) Waiver. Any term or condition of this Agreement may be waived at any time by the
party hereto which is entitled to have the benefit thereof, but such waiver shall only be effective
if evidenced by a writing signed by such party, and a waiver on one occasion shall not be deemed to
be a waiver of the same or any other type of breach on a future occasion. No failure or delay by a
party hereto in exercising any right or power hereunder shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right or power.



(c) Withholding Taxes. The Company may withhold from any amounts payable under this
Agreement such federal, state, local or foreign taxes as shall be required to be withheld pursuant
to any applicable law or regulation.



(d) Nonalienation of Benefits. The Executive shall not have any right to pledge,
hypothecate, anticipate or in any way create a lien upon any payments or other benefits provided
under this Agreement; and no benefits payable hereunder shall be assignable in anticipation of
payment either by voluntary or involuntary acts, or by operation of law, except by will or pursuant
to the laws of descent and distribution.


 


21









 





(e) Severability. If any provision of this Agreement is held to be invalid or
unenforceable, (a) this Agreement shall be considered divisible, (b) such provision shall be deemed
inoperative to the extent it is deemed invalid or unenforceable, and (c) in all other respects this
Agreement shall remain in full force and effect; provided, however, that if any such provision may
be made valid or enforceable by limitation thereof, then such provision shall be deemed to be so
limited and shall be valid and/or enforceable to the maximum extent permitted by applicable law.



(f) Entire Agreement. This Agreement constitutes the entire agreement between the
parties hereto concerning the subject matter hereof, and from and after the date of this Agreement,
this Agreement shall supersede any other prior agreement or understanding, both written and oral,
between the parties with respect to such subject matter.



(g) Captions. The captions herein are inserted for convenience of reference only, do
not constitute a part of this Agreement, and shall not affect in any manner the meaning or
interpretation of this Agreement.



(h) References. All references in this Agreement to Paragraphs, subparagraphs and
other subdivisions refer to the Paragraphs, subparagraphs and other subdivisions of this Agreement
unless expressly provided otherwise. The words “this Agreement”, “herein”, “hereof”, “hereby”,
“hereunder” and words of similar import refer to this Agreement as a whole and not to any
particular subdivision unless expressly so limited. Whenever the words “include”, “includes” and
“including” are used in this Agreement, such words shall be deemed to be followed by the words
“without limitation”. Words in the singular form shall be construed to include the plural and vice
versa, unless the context otherwise requires.


 


22









 





IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its behalf by its
duly authorized officer, and the Executive has executed this Agreement, as of the date first above
set forth.



	 	 	 	 	 
	 	“COMPANY”

NOBLE DRILLING SERVICES INC.

 	 
	 	By:  	/s/ JULIE J. ROBERTSON
 	 
	 	 	Name:  	JULIE J. ROBERTSON 	 
	 	 	Title:  	EXECUTIVE VICE PRESIDENT 	 
	 
	 	“EXECUTIVE”

 	 
	 	/s/ DAVID W. WILLIAMS
 	 



 


23









 





	 	 	 	 	 



GUARANTY





This GUARANTY is made as of December 30, 2008 by NOBLE CORPORATION, a Cayman Islands exempted
company limited by shares (the “Company”), for the benefit of DAVID W. WILLIAMS (the “Executive”);



WITNESSETH:




WHEREAS, Noble Drilling Services Inc., a Delaware corporation and an indirect, wholly owned
subsidiary of the Company (“Noble-Delaware”), has entered into an Employment Agreement with the
Executive dated as of the date hereof (the “Employment Agreement”); and



WHEREAS, the Company desires to guarantee the performance by Noble-Delaware of its obligations
under the Employment Agreement, and the Board of Directors of the Company has determined that it is
reasonable and prudent for the Company to deliver this Guaranty and necessary to promote and ensure
the best interests of the Company and its Members;



NOW, THEREFORE, in consideration of the premises, the Company hereby irrevocably and
unconditionally guarantees, as primary obligor, the due and punctual performance by Noble-Delaware
of its agreements and obligations, all and singular, under the Employment Agreement. This Guaranty
shall survive any liquidation of Noble-Delaware or any of its subsidiaries. This Guaranty shall be
governed by and construed in accordance with the laws of the State of Texas.



The obligations of the Company hereunder shall be absolute and unconditional and shall remain
in full force and effect until the termination of the Employment Agreement or the complete
performance by Noble-Delaware of its obligations thereunder, irrespective of the validity,
regularity or enforceability of the Employment Agreement, any change or amendment thereto, the
absence of any action to enforce the same, any waiver or consent by the Executive or Noble-Delaware
with respect to any provision of the Employment Agreement, the recovery of any judgment against
Noble-Delaware or any action to enforce the same, or any other circumstances that may otherwise
constitute a legal or equitable discharge or defense of the Company. The Company waives any right
of set-off or counterclaim it may have against the Executive arising from any other obligations the
Executive may have to Noble-Delaware or the Company.



The Company shall require any successor or assign (whether direct or indirect, by purchase,
merger, reorganization, consolidation, amalgamation or otherwise) to all or substantially all the
business and/or assets of the Company, by agreement in writing in form and substance reasonably
satisfactory to the Executive, expressly, absolutely and unconditionally to assume and agree to
perform this Guaranty in the same manner and to the same extent that the Company would be required
to perform it if no such succession or assignment had taken place. As used in this Guaranty, the
“Company” shall mean the Company as hereinbefore defined and any successor or assign to the
business and/or assets of the Company as aforesaid which executes and delivers the agreement
provided for in this paragraph or which otherwise becomes bound by all the terms and provisions of
this Guaranty by operation of law.


 


1









 





IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on its behalf by its
duly authorized officer as of the date first above set forth.



	 	 	 	 	 
	 	NOBLE CORPORATION

 	 
	 	By:  	/s/ JULIE J. ROBERTSON
 	 
	 	 	Name:  	JULIE J. ROBERTSON 	 
	 	 	Title:  	EXECUTIVE VICE PRESIDENT 	 




 


2