----

|   | (a) | The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated underthe Exchange Act) of twenty percent (20%) or more of either (i) the then outstanding shares of common stock of Atwood or (ii) the combined voting power of the then outstanding voting securities of Atwood entitled to vote generally in the election of directors; provided, however, that the following acquisitions shall not constitute a Change of Control:  (i) any acquisition directly from Atwood; (ii) any acquisition by Atwood; (iii) any acquisition by any employee benefit plan (or related trust) sponsoredor maintained by the Company; or |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (b) | Atwood shall sell substantially all of its assets to another corporation which is not a wholly owned subsidiary; or |
|--------|-----|---------------------------------------------------------------------------------------------------------------------|

|   | (c) | Individuals who, as of the date hereof, constitute the Board of Atwood (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 Atwood’s shareholders, was approved bya vote of at least a majority of the directors 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 an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (a) | such individual’s weekly Base Salary multiplied by such individual’s Years of Continuous Service; or |
|--------|-----|------------------------------------------------------------------------------------------------------------------|

|   | (b) | a payment, depending upon the category of employee as identified in Schedule 3.1 hereto, as follows: |
|--------|-----|------------------------------------------------------------------------------------------------------|

|  Category of Employee                                                           | Payment                                                                                                                                                        |
|--------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Houston Management A:                                                                | (i)           Less than 4 Years of Continuous Service - 6 months' Base Salary; or                       |
|                                                                                 |  (ii)           4 Years but less than 8 Years of Continuous Service - 12 months' Base Salary; or   |
|                                                                                 |  (iii)           8 or greater Years of Continuous Service - 18 months' Base Salary                 |
|  Houston Management B,Houston Technical,Rig Management andOther Administration: |     (i)           Less than 4 Years of Continuous Service - 1 month Base Salary; or |
|                                                                                 |  (ii)           4 Years but less than 8 Years of Continuous Service - 4 months' Base Salary; or    |
|                                                                                 |  (iii)           8 Years but less than 12 Years of Continuous Service - 8 months' Base Salary; or  |
|                                                                                 |  (iv)           12 or greater Years of Continuous Service - 12 months' Base Salary                 |
|  Houston Accounting A, Houston Accounting B andHouston Staff:                   |    (i)           Less than 4 Years of Continuous Service - 1 month Base Salary; or       |
|                                                                                 |  (ii)           4 Years but less than 8 Years of Continuous Service - 3 months' Base Salary; or    |
|                                                                                 |  (iii)           8 or greater Years of Continuous Service - 6 months' Base Salary                  |

----

|   | (a) | Upon a Termination of Employment and if applicable, the Company will notify each Covered Employee of the right to elect to continue any Company-provided health or disability benefits, all in accordance with and subject to the provisions of the Consolidated Omnibus Budget Reconciliation Act ("COBRA").  The Company shall charge the maximum allowablepremium in connection with any COBRA benefits so provided.  Other than the benefits provided under COBRA, the Company shall have no further obligation to provide health or disability insurance benefits to any Covered Individual following a Termination of Employment. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (b) | Upon written request by a Covered Individual within five (5) days of a Termination of Employment, the Company shall assign any life, salary continuation or travel insurance plans or policies to such Covered Individual which by their terms are so assignable, and such Covered Individual will thenceforth become responsible for the payment of any premiums required to maintain said plans or policies from and after the dateof Termination of Employment; otherwise, the Company will cease to continue such life insurance plans or policies on behalf of any Covered Employee effective as of the date of Termination of Employment. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (a) | the specific reason or reasons for the denial; |
|--------|-----|------------------------------------------------|

|   | (b) | specific reference to pertinent Plan provisions on which the denial is based; |
|--------|-----|-------------------------------------------------------------------------------|

|   | (c) | a description of any additional material or information necessary for the claimant to perfect the claim and an explanation of why such material or information is necessary; and |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (d) | an explanation of the claim-review procedure. |
|--------|-----|-----------------------------------------------|

|   | (a) | request a review upon written application to the Company’s personnel administrator; |
|--------|-----|-------------------------------------------------------------------------------------------|

|   | (b) | review pertinent documents; and |
|--------|-----|---------------------------------|

|   | (c) | submit issues and comments in writing. |
|--------|-----|----------------------------------------|

----

----

----