Document:

Form of Performance Share Agreement

 Exhibit (10)(r)(ii) 
 POTLATCH CORPORATION 
 PERFORMANCE SHARE AGREEMENT 
 2005 STOCK INCENTIVE PLAN 
 THIS PERFORMANCE SHARE AGREEMENT (this
“Agreement”) is made and entered into on the Grant Date specified in the attached Addendum to this Agreement by and between POTLATCH CORPORATION, a Delaware corporation (the “Corporation”), and the employee of the
Corporation or an Affiliate named in the Addendum (the “Employee”). 
 W I T N E S S E T H: 
 WHEREAS, the Corporation maintains the Potlatch Corporation 2005 Stock Incentive Plan (the “Plan”), which is incorporated into and forms a part
of this Agreement, and the Employee has been selected to receive a contingent grant of Performance Shares under Section 10 of the Plan; 
 NOW, THEREFORE, for valuable consideration, the parties agree as follows: 
  

	 	1.	Definitions. In addition to the terms defined elsewhere in this Agreement, the following terms used in this Agreement shall have the meanings set forth in this
Section 1. Capitalized terms not defined in this Agreement shall have the same definitions as in the Plan. 

  

	 	(a)	“Addendum” means the attached Addendum. 

  

	 	(b)	“Board” means the Board of Directors of the Corporation. 

  

	 	(c)	“Change in Control” means an event or transaction described in Section 7(e) of the Plan. 

  

	 	(d)	“Code” means the Internal Revenue Code of 1986, as amended. 

  

	 	(e)	“Common Stock” means the $1 par value Common Stock of the Corporation. 

  

	 	(f)	“Committee” means the committee appointed by the Board to administer the Plan. 

  

	 	(g)	 “Disability” means the condition of the Employee who is unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in death or 

  

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which has lasted or can be expected to last for a continuous period of at least 12 months. 

  

	 	(h)	“Grant Date” means the effective date of the Award of the Performance Shares to the Employee, as specified in the Addendum. 

  

	 	(i)	“Performance Shares” means an award denominated in Shares granted pursuant to Section 10 of the Plan. 

  

	 	(j)	“Share” means one share of Common Stock, adjusted in accordance with Section 16 of the Plan. 

  

	 	2.	Award. Subject to the terms of this Agreement and the Addendum, the Employee is hereby awarded a target contingent grant of Performance Shares in the number set forth in the
attached Addendum (the “Award”). The number of Shares actually payable to the Employee is contingent on the performance achieved as specified in the Addendum. This Award has been granted pursuant to the Plan, a copy of which is attached
and the terms and conditions of which are incorporated by reference into this Agreement. 

  

	 	3.	Performance Measure. The performance measure is a comparison of the percentile ranking of the Corporation’s total stockholder return (stock price appreciation plus
dividends as calculated pursuant to Section 5 below) as compared to the total stockholder return performance of a selected peer group of forest products industry companies as specified in the Performance Schedule contained in the Addendum.

  

	 	4.	Performance Period. The Performance Period is the period specified in the Addendum (the “Performance Period”) and represents the period during which the total
stockholder return for the Corporation and the selected peer group of companies is measured. 

  

	 	5.	Calculation Of Total Stockholder Return. Total stockholder return for any given common stock shall be expressed as a percentage and calculated by: 

 

	 	(i)	subtracting (a) the beginning average stock price for one share of stock (determined by calculating the average closing stock price during the two calendar months preceding the
beginning of the Performance Period) from (b) the ending average stock price for such share of stock (determined by calculating the average closing stock price during the final two calendar months of the Performance Period, after taking into
account the affect of any stock dividends, stock splits, consolidations, recapitalizations, reorganizations or like events with respect to such share); and 

  

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	 	(ii)	adding to the difference determined under subparagraph (i) above, all cash dividends actually paid on such share of stock during the Performance Period; and

  

	 	(iii)	dividing the sum determined by subparagraphs (i) and (ii) above by the beginning average stock price determined pursuant to subparagraph (i)(a) above.

  

	 	6.	Dividend Equivalents. During the Performance Period, dividend equivalents shall be converted into additional Performance Shares based on the closing price of the
Corporation’s Common Stock on the New York Stock Exchange on the dividend payment date. Such additional Performance Shares shall vest or be forfeited in the same manner as the underlying Performance Shares to which they relate.

  

	 	7.	Settlement of Awards. Pursuant to Section 5 above, the Corporation shall deliver to the Employee one Share for each earned Performance Share (and, as applicable, for the
accrued dividend equivalents) as determined in accordance with the provisions set forth in the Addendum . Any earned Performance Shares payable to the Employee (including Shares payable pursuant to Section 6 above) shall be paid solely in
Shares. Any fractional Share will be rounded to the closest whole Share. 

  

	 	8.	Time of Payment. Except as otherwise provided in this Agreement, the Shares issuable for the earned Performance Shares and accrued dividend equivalents shall be delivered to
the Employee (or, in the case of the Employee’s death before delivery, to the Employee’s beneficiary or representative) as soon as practicable after the end of the Performance Period as set forth in the Addendum. 

 

	 	9.	Committee Discretion to Reduce Award. Notwithstanding any provision in this Agreement to the contrary, the Committee retains the right, at its sole and absolute discretion,
to reduce or eliminate any Award that may become payable hereunder if the Committee determines that any one or more of the following conditions have occurred: 

 (a) The stockholder return to the Corporation’s stockholders has been insufficient; 
 (b) The stockholder return to the Corporation’s stockholders has been negative; 
 (c) The financial performance of the Corporation has been inadequate; or 
 (d) The operational performance of the Corporation has been inadequate 

	 	    	In addition, the Committee may reduce or eliminate the Award granted hereby based on the Employee’s individual performance. 

  

	 	10.	 Retirement, Disability, or Death During Performance Period. If the Employee’s employment with the Corporation or an Affiliate terminates during the
Performance Period because of the Employee’s retirement under the Salaried Employees’ Retirement Plan, or his or her Disability or death, the Employee (or, in the case of the Employee’s death, the Employee’s beneficiary or
representative) shall be entitled to a prorated number of the Performance Shares granted. The prorated number of Performance Shares earned is determined at the end of the Performance Period based on the ratio of the number of completed calendar
months the Employee is employed 

  

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during the Performance Period to the total number of months in the Performance Period. 

  

	 	11.	Termination of Employment During the Performance Period. If the Employee’s employment with the Corporation or an Affiliate terminates during the Performance Period for
any reason other than retirement under the Salaried Employees’ Retirement Plan, or his or her Disability, or death, the entire Award granted under this Agreement shall be automatically terminated as of the date of such termination of
employment. 

  

	 	12.	Change in Control. In the event that the Employee’s employment with the Corporation or an Affiliate is involuntarily terminated without Cause (as defined in the Plan) or
voluntarily terminated for Good Reason (as defined in the Plan) within one month prior to or 24 months following the effective date of a Change in Control that is at least six months following the Grant Date, the Performance Shares shall become
immediately vested in full and immediately payable in accordance with Section 4 above. 

  

	 	13.	Available Shares. The Corporation agrees that it will at all times during the term of this Agreement reserve and keep available sufficient authorized but unissued or
reacquired Shares to satisfy the requirements of this Agreement. 

  

	 	14.	Recapitalization. The number of Share Equivalents covered by this Performance Share award shall be proportionately adjusted for any increase or decrease in the number of
issued Shares by reason of stock dividends, stock splits, consolidations, recapitalizations, reorganizations or like events, as determined by the Committee pursuant to Section 16 of the Plan. Subject to any required action by the stockholders,
if the Corporation is a party to a merger, consolidation or other reorganization, the Performance Shares covered by this Award shall entitle the Employee to the same securities or other consideration as shall be paid to holders of the
Corporation’s outstanding Shares upon such corporate reorganization. 

  

	 	15.	Applicable Taxes. In the event the Corporation determines that it is required to withhold state or federal income tax as a result of the payment of the Shares, the Employee
will make arrangements satisfactory to the Corporation to enable it to satisfy such withholding requirements. 

  

	 	16.	Relationship to Other Benefits. Performance Shares shall not be taken into account in determining any benefits under any pension, savings, disability, severance, group
insurance or any other pay-related plan of the Corporation or its Affiliates. 

  

	 	17.	 Required Deferral. In the event the Award would cause the Employee to qualify as a “covered employee” pursuant to Section 162(m) of the Code,
that portion of the Award that would exceed the amount deductible by the Corporation under Section 162(m) of the Code shall be automatically deferred until the Employee’s compensation is no longer subject to Section 162(m) of the
Code. Any portion of the Award so deferred shall be converted to stock units and dividend equivalents shall accrue on the 

  

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stock units and be paid out as additional shares after the Employee’s compensation is no longer subject to Section 162(m) of the Code. Any deferral
of the Performance Share Award is intended to comply with Section 409A of the Code. 

  

	 	18.	Stockholder Rights. Neither the Employee nor the Employee’s beneficiary or representative shall have any rights as a stockholder with respect to any Shares subject to
this Agreement until such Shares shall have been issued to the Employee or the Employee’s beneficiary or representative. 

  

	 	19.	Transfers, Assignments, Pledges. Except as otherwise provided in this Agreement, the rights and privileges conferred by this Agreement shall not be transferred, assigned,
pledged or hypothecated in any way (whether by operation of law or otherwise) and shall not be subject to sale under execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of the
Award, or of any right or privilege conferred by this Agreement, contrary to the provisions of this Section 19, or upon any attempted sale under any execution, attachment or similar process upon the rights and privileges conferred by this
Agreement, the Award and the rights and privileges conferred by this Agreement shall immediately become null and void. 

  

	 	    	However, this Section 19 shall not preclude: (i) an Employee from designating a beneficiary to succeed, after the Employee’s death, to any rights of the Employee or
benefits distributable to the Employee under this Agreement not distributed at the time of the Employee’s death; or (ii) a transfer of any Award hereunder by will or the laws of descent or distribution. In that regard, any such rights
shall be exercisable by the Employee’s beneficiary, and such benefits shall be distributed to the beneficiary, in accordance with the provisions of this Agreement and the Plan. The beneficiary shall be the named beneficiary or beneficiaries
designated by the Employee in writing filed with the Corporation in such form and at such time as the Corporation shall require. If a deceased Employee has failed to designate a beneficiary, or if the designated beneficiary does not survive the
Employee, any benefits distributable to the Employee shall be distributed to the legal representative of the estate of the Employee. If a deceased Employee has designated a beneficiary and the designated beneficiary survives the Employee but dies
before the complete distribution of benefits to the designated beneficiary under this Agreement, then any benefits distributable to the designated beneficiary shall be distributed to the legal representative of the estate of the designated
beneficiary. 

  

	 	20.	No Employment Rights. Nothing in this Agreement shall be construed as giving the Employee the right to be retained as an employee or as impairing the rights of the
Corporation or an Affiliate to terminate his or her employment at any time, with or without cause. 

  

	 	21.	 Administration. The authority to manage and control the operation and administration of this Agreement shall be vested in the Committee, and the Committee

  

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shall have all powers with respect to this Agreement as it has with respect to the Plan. Any interpretation of this Agreement by the Committee and any
decision made by it with respect to this Agreement is final and binding. 

  

	 	22.	Interpretation/Applicable Law. Except as provided in Section 21 hereof, this Agreement shall be interpreted and construed in a manner consistent with the terms of the
Plan and in accordance with the laws of the State of Delaware (without regard to choice of law principles). If there is any discrepancy between the terms and conditions of this Agreement and the terms and conditions of the Plan, the terms and
conditions of the Plan shall control. 

  

	 	23.	Term of the Agreement. The term of this Agreement shall end upon the earlier of (i) the delivery of all of the Shares or other consideration to be issued in exchange for
Performance Shares (and accrued dividend equivalents) or (ii) upon the termination of the Employee’s employment with the Corporation or an Affiliate, if applicable, for any reason other than retirement under the Salaried Employees’
Retirement Plan, or the Employee’s Disability or death. 

 *********************** 
  

 6Form of Notice of Grant

 Exhibit 10.1 
 GLOBALSANTAFE CORPORATION 
 NOTICE OF GRANT 
 AND SPECIFICATION OF THE TERMS AND CONDITIONS 
 OF 
 NON-EMPLOYEE DIRECTOR STOCK-SETTLED STOCK APPRECIATION RIGHTS 
 GRANTED TO 
 [NAME OF GRANTEE]

 (Under the GlobalSantaFe 2003 Long-Term Incentive Plan) 
 GLOBALSANTAFE CORPORATION (the “Company”), desiring to afford you an opportunity to acquire ordinary shares of the Company, $.01 par value (“Ordinary Shares”), and to provide you with an
added incentive as a director of the Company, has established the following terms and conditions under which it has granted to you the stock-settled stock appreciation rights specified below (the “SARs”) under the GlobalSantaFe 2003
Long-Term Incentive Plan (the “Plan”). Each SAR will allow you to receive a number of Ordinary Shares during a specified term subject to and upon the terms and conditions set forth below. 
 You are urged to consult your tax advisor prior to exercising any of the SARs and prior to disposing of any shares acquired upon such exercise.

  

	1.	Specification of Date, Number of SARs, Grant Date Price, and Term. 

  

	 	(a)	The Grant Date of the SARs is [Grant Date]. 

  

	 	(b)	The number of SARs granted to you hereby is [Total Number Of SARs Granted] and is subject to adjustments under Section 7. 

  

	 	(c)	Subject to acceleration under Sections 2 and 5 and to adjustments under Section 7, an installment of [1/2 Of The Number in (b)] of the [The Number in (b)] SARs granted hereby
first becomes exercisable on [Date One Year From Grant Date], and a second installment consisting of the remaining [1/2 Of The Number in (b)] SARs granted hereby first becomes exercisable on [Date Two Years From Grant Date].

  

	 	(d)	The Grant Date price per share applicable to the SARs (the “Grant Date Price”) is $[Dollar Amount], subject to adjustments under Section 7. 

 

	 	(e)	 The term of the SARs commences [Grant Date], and expires at the close of business at the Company’s principal executive office on [Date Ten 

 
Years Minus One Business Day From Grant Date]. Upon the expiration of such term, the SARs shall expire and be cancelled and may not thereafter be exercised.

  

	2.	Installment Provisions and Acceleration. The SARs are not exercisable in any part until the earliest of the dates specified in this Section and in Section 5 below.

 The installments set forth in Section 1(c) are cumulative, so that each matured installment or any portion thereof may
be exercised at any time from the date it becomes exercisable until the expiration or prior termination of the SARs. 
 If a Change in
Control occurs while you are a director of the Company, the SARs shall become fully exercisable on the date of such Change in Control irrespective of the limitations described in Section 1(c) and shall remain exercisable throughout the term of
the SARs. 
 A “Change in Control” means the occurrence of any of the following events: 
 (i) The acquisition by any individual, entity or group (within the meaning of Section 13(d) or 14(d) of the U.S. Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) (a “Person”), other than an Excluded Person, of the beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of 35% or more of either (A) the then outstanding ordinary
shares of the Company (the “Outstanding Company Ordinary Shares”) or (B) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the election of directors (the “Outstanding
Company Voting Securities”); provided, however, that neither an acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or by any affiliate controlled by the Company nor an acquisition by an affiliate
of the Company that remains under the Company’s control will constitute a Change in Control; or 
 (ii) Individuals who, as of the date
hereof, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or
nomination for election by the Company’s equityholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board will be considered as though such individual were a member of the Incumbent Board, but
excluding for this purpose any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (meaning a solicitation of the type that would be subject to Rule 14a-11 of Regulation 14A under
the Exchange Act) or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or 
 (iii) Approval by the equityholders of the Company of a reorganization, merger, consolidation or similar transaction to which the Company or any affiliate is a party, in each case unless, following such reorganization, merger, 

  

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

  

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the Company’s four most recently completed fiscal quarters for which reports have been completed) of the Company and its affiliates immediately prior
thereto, other than to an affiliate of the Company or to a corporation or other entity with respect to which following such sale or other disposition (I) more than 50% of, respectively, the then outstanding ordinary shares or shares of common
stock of such corporation or other entity and the combined voting power of the then outstanding voting securities of such corporation or other entity entitled to vote generally in the election of directors is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Ordinary Shares and Outstanding Company Voting Securities immediately prior to such sale or other
disposition in substantially the same proportions as their ownership, immediately prior to such sale or other disposition, of the Outstanding Company Ordinary Shares and Outstanding Company Voting Securities, as the case may be, (II) no Person
(excluding the Company, any affiliate of the Company that remains under the Company’s control, any employee benefit plan (or related trust) sponsored or maintained by the Company or by any affiliate controlled by the Company or such
corporation, and any Person beneficially owning, immediately prior to such sale or other disposition, directly or indirectly, 35% or more of the Outstanding Company Ordinary Shares or Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, 35% or more of, respectively, the then outstanding ordinary shares or shares of common stock of such corporation or other entity or the combined voting power of the then outstanding voting securities of
such corporation or other entity entitled to vote generally in the election of directors, and (III) at least a majority of the members of the board of directors of such corporation were members of the Incumbent Board at the time of the execution of
the initial agreement or action of the Board providing for such sale or other disposition of assets; or 
 (v) Approval by the equityholders
of the Company of a “merger of equals” (which for purposes of this Subsection shall mean a merger with another company of relatively equal size) to which the Company is a party as a result of which the persons who were equity holders of
the Company immediately prior to the effective date of such merger shall have beneficial ownership of less than 55% of the combined voting power for election of members of the board (or equivalent) of the surviving entity or its parent following the
effective date of such merger, provided that the Board shall have authority to increase said percentage as may in its sole discretion be deemed appropriate to cover a specific transaction. 
 For purposes of the preceding sentence, the term “Excluded Person” shall mean and include (i) any corporation beneficially owned by
shareholders of the Company in substantially the same proportion as their ownership of shares of the Company and (iii) the Company and any affiliate of the Company. Also, for purposes of the preceding sentence, the term “Board” shall
mean the board of directors of the Company. 
  

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	3.	Method of Exercise. The SARs may be exercised from time to time, in accordance with their terms, by written notice thereof signed and delivered by you or another person
entitled to exercise the SARs to the Corporate Secretary of the Company at its principal executive office in Houston, Texas, or as it may hereafter be located, or to such brokerage firm, third-party agent or other person as may be designated by the
Secretary from time to time. Such notice shall state the number of SARs being exercised and the grant date of the SARs being exercised. 

 No later than 14 days after receipt of such notice, the Company shall issue and deliver to you whole Ordinary Shares equal in number to the product of A multiplied by B and then divided by C, where A is the number of
vested SARs exercised, B is the result of subtracting the Grant Date Price from the per-share Fair Market Value of the Ordinary Shares prevailing at the time of exercise as defined by the Plan, and C is the per-share Fair Market Value of the
Ordinary Shares prevailing at the time of exercise as defined by the Plan. Any fractional shares resulting from this calculation shall be valued at the per-share Fair Market Value of the Ordinary Shares prevailing at the time of exercise as defined
by the Plan and paid to you in cash if there is no withholding requirement as a result of the exercise; if there is a withholding requirement, said cash amount will be applied toward satisfying the withholding requirement. 
 Upon exercise of any of the SARs, the Company will withhold from the shares to be delivered shares with a Fair Market Value (as prescribed by the Plan)
sufficient to satisfy all or a portion of any Federal, state and local tax withholding requirements, or the person exercising the SARs may deliver to the Company Ordinary Shares with a Fair Market Value sufficient to satisfy all or a portion of such
tax withholding requirements, excluding any shares deemed unacceptable for any reason by the Committee of the Company’s board of directors administering the GlobalSantaFe 2003 Long-Term Incentive Plan. 
  

	4.	 Transferability. You may not transfer the SARs or any portion thereof other than by will or by the laws of descent and distribution or, if applicable, as
authorized by the following sentence, and the SARs shall be exercisable during your lifetime only by you or, if applicable, by a transferee authorized by the following sentence. The SARs or any portion thereof may be transferred by you to
(i) your spouse, children or grandchildren (“Immediate Family Members”), (ii) a trust or trusts for your exclusive benefit and/or the exclusive benefit of Immediate Family Members, (iii) a partnership in which you and/or
Immediate Family Members are the only partners, (iv) a transferee pursuant to a judgment, decree or order relating to child support, alimony or marital property rights that is made pursuant to a domestic relations law of a state or country with
competent jurisdiction (a “Domestic Relations Order”), or (v) such other transferee as may be approved by the Compensation Committee of the Company’s Board of Directors in its sole and absolute discretion; provided, however, that
(x) the Board of Directors of the 

  

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Company and its Compensation Committee each reserves the right to prohibit any transfer with or without cause in its sole and absolute discretion, and
(y) subsequent transfers of the SARs or any portion thereof are prohibited except those to or by you in accordance with this Section, by will or the laws of descent and distribution, or pursuant to a Domestic Relations Order. Following any
transfer, the SARs shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer, and any and all references to you in this Notice shall be deemed to refer to the transferee; provided, however, that
any and all references to service as a director or events of termination of service as a director shall continue to mean your service as a director or events of termination of your service as a director, and following any such event the SARs shall
be exercisable by the transferee only to the extent and for the periods specified in this Notice. Each transfer shall be effected by written notice thereof duly signed and delivered by the transferor to the Corporate Secretary of the Company at its
principal executive office in Houston, Texas, or as it may hereafter be located. Such notice shall state the name and address of the transferee, the number of SARs being transferred, and such other information as may be requested by the Corporate
Secretary. The person or persons entitled to exercise the SARs shall be that person or those persons appearing on the registry books of the Company as the owner or owners of the SARs, and the Company may treat the person or persons in whose name or
names the SARs are registered as the owner or owners of the SARs for all purposes. The Company shall have no obligation to, or liability for any failure to, notify you or any transferee of any termination of the SARs at or prior to their normal
expiration date or of any event that will or might result in such termination. 
  

	5.	 Termination of Service as a Director. If your service as a director of the Company is terminated by reason of your death, disability or ineligibility for
reelection under the provisions of the Company’s Articles of Association regarding age (“retirement”), or your service as a director of the Company is terminated by the Company’s shareholders other than for cause (to mean acts of
misconduct harmful to the Company, inadequate performance or incompetence), or your service as a director of the Company is terminated due to a failure to nominate you for reelection as a director other than for cause, the SARs will immediately
become exercisable as to the full number of SARs specified in Section 1(b), to the extent not previously exercised, and will remain exercisable as to said full number of SARs until the expiration of the term of the SARs; provided, however, that
if the foregoing acceleration provision becomes operative during the six-month period immediately following the Grant Date of the SARs, then the SARs shall immediately become exercisable as to said full number of SARs upon the expiration of said
six-month period and remain exercisable until the expiration of the term of the SARs. In any other case of termination of your service as a director, including without limitation termination by the Company’s shareholders for cause, or due to a
failure to nominate you for reelection for cause, or due to your resignation or decision not to stand for reelection, the SARs shall remain exercisable, only to the extent exercisable at the date of such 

  

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termination, for three months after termination of service as a director, said period in any event not to extend beyond the expiration of the term of the
SARs. Upon expiration of the foregoing periods, the SARs shall expire, terminate and be cancelled in all respects. At the time your service as a director of the Company terminates, the SARs shall expire, terminate and be cancelled in all respects as
to all shares other than the shares as to which the SARs can be exercised at the time of or as a result of such termination. 
 Anything to
the contrary in these Terms and Conditions notwithstanding, if your service as a director of the Company terminates and such termination does not and will not result in acceleration of the vesting of all unvested installments of the SARs, any
unvested installment of the SARs that would have vested within the 15 days following the day of such termination will be deemed to have vested on the day immediately preceding the day of such termination. 
  

	6.	Death, Disability or Retirement. In the event of your death, disability or retirement, you or your legal representative or representatives, or the person or persons entitled
to do so under your last will and testament or under applicable intestate laws, shall have the right to exercise the SARs, to the extent not previously exercised, as to the lesser of the full number of SARs specified in Section 1(b) hereof or
such lesser number of SARs as shall have resulted from the operation of Section 5. For purposes of Section 5 and this Section 6, the term “disability” shall mean a physical or mental condition which totally and permanently
prevents you from continuing to serve as a director, as reasonably determined in good faith by the Compensation Committee of the Board of Directors of GlobalSantaFe Corporation. 

  

	7.	Adjustments. If outstanding shares of the class then subject to the SARs are increased, decreased, changed into or exchanged for a different number or kind of shares or
securities of the Company through reorganization, recapitalization, reclassification, stock dividend, stock split or reverse stock split, then there shall be substituted for each share then underlying the unexercised portion of the SARs the number
and class of shares or securities into or for which each outstanding share of the class underlying the SARs shall be so changed or exchanged, with a corresponding adjustment in the Grant Date Price. Such adjustments shall become effective on the
effective date of any such transaction; except that in the event of a stock dividend or of a stock split effected by means of a stock dividend or distribution, such adjustments shall become effective immediately after the record date therefor.

 Upon a dissolution or liquidation of the Company, or upon a reorganization, merger or consolidation of the Company with one
or more corporations as a result of which the Company is not the surviving corporation, or upon a sale of substantially all of the property of the Company (“Terminating Transactions”), the SARs shall terminate, unless provision be made in
writing in connection with such transaction for the assumption of stock appreciation rights theretofore 

  

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granted under the Plan under which the SARs were granted, or the substitution for such stock appreciation rights of any stock appreciation rights covering
the stock of a successor employer corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices, in which event the SARs shall continue in the manner and under the terms so provided. If
the SARs shall terminate pursuant to the foregoing sentence, the person then entitled to exercise any unexercised portions of the SARs shall have the right, at such time immediately prior to the consummation of the Terminating Transaction as the
Company shall designate, to exercise the SARs to the extent not theretofore exercised. 
 Adjustments under this Section 7 shall be made
by the Company’s Board of Directors whose determination as to what adjustment shall be made, and the extent thereof, shall be final, binding and conclusive. No fractional shares of stock shall be issued under the SARs or in connection with any
such adjustment. 
  

	8.	Limitation. You or any other person entitled to exercise the SARs shall be entitled to the privileges of stock ownership in respect of shares subject to the SARs only when
such shares have been issued and delivered as fully paid shares upon exercise of the SARs in accordance with their terms. 

  

	9.	Requirements of Law and of Stock Exchanges. The issuance and delivery of shares upon the exercise of the SARs shall be subject to compliance with all of the applicable
requirements of law with respect to the issuance, delivery and sale of such shares. In addition, the Company shall not be required to issue or deliver any shares upon exercise of any of the SARs prior to the admission of such shares to listing on
notice of issuance on any stock exchange on which shares of the same class are then listed. 

 By accepting the SARs, you
represent and agree for yourself and your transferees by will or by the laws of descent and distribution or otherwise that unless a registration statement under the Securities Act of 1933 is in effect as to the shares deliverable upon any exercise
of the SARs, any and all shares so delivered shall be acquired for investment and not for sale or distribution and each notice of the exercise of any portion of the SARs shall be accompanied by a representation and warranty in writing, signed by the
person entitled to exercise the same, that the shares are being so acquired by good faith for investment and not for sale or distribution. In the event the Company’s legal counsel shall, at the Company’s request, advise it that
registration under the Securities Act of 1933 of the shares as to which the SARs are at the time being exercised is required prior to issuance or delivery thereof, the Company shall not be required to issue or deliver such shares unless and until
such legal counsel shall advise that such registration has been completed or is not required. 
  

	10.	 GlobalSantaFe 2003 Long-Term Incentive Plan. The SARs are subject to, and the Company and you are bound by, all of the terms and conditions of the 

  

 8 

 
GlobalSantaFe 2003 Long-Term Incentive Plan as the same may be amended from time to time in accordance with the terms thereof, provided that no such
amendment shall deprive you, without your consent, of the SARs or any rights hereunder. The Board of Directors of the Company or its Committee established for such purposes is authorized to adopt rules and regulations not inconsistent with the Plan
and to take such action in the administration of the Plan as it shall deem proper. A copy of the Plan in its present form is available for inspection at the Company’s principal executive office during business hours by you or any other persons
entitled to exercise the SARs. 
  

	11.	Definition of Certain Terms. Capitalized terms used in this Notice and not defined herein are used as they are used in the GlobalSantaFe Corporation 2003 Long-Term Incentive
Plan as the same shall have been amended from time to time. The term “you,” and related terms such as “your” used in this document refer to the individual whose name appears in the heading on the first page of this document.

 (Rev 5-06) 
  

 9

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