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Exhibit 10a
ROWAN COMPANIES, INC.
Amendment No. 2
Dated April 25, 1997
to the
1988 Nonqualified Stock
Option Plan As Amended
Resolution adopted by the registrant's Board of Directors on April 25, 1997:
RESOLVED, that Paragraph III. OPTION AGREEMENTS of the Plan is hereby amended
effective as of April 25, 1997 by adding thereto the following paragraph:
"The Committee may, in its discretion, provide in an Option Agreement
that the Option granted thereby to the employee may be transferred (in
whole or in part and subject to such other conditions or limitations,
if any, as the Committee may impose with respect to such transfer) by
the employee to (i) the spouse, children or grandchildren of the
employee ("Immediate Family Members"), (ii) a trust or trusts for the
exclusive benefit of the Immediate Family Members and, if applicable,
the employee, (iii) a partnership or limited liability company in
which such Immediate Family Members and, if applicable, the employee
are the only partners or members, or (iv) an organization that has
been determined by the Internal Revenue Service to be exempt under
Section 501(c)(3) of the Internal Revenue Code. Following a transfer,
such transferred Option shall continue to be subject to the same terms
and conditions as were applicable to the Option immediately prior to
transfer and no transferred Option shall be exercisable unless
arrangements satisfactory to the Company have been made with respect
to the Option."
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Exhibit 10a
ROWAN COMPANIES, INC.
Amendment
Dated April 25, 1997
to the
Stock Option Agreement
to the 1988
Nonqualified Stock
Option Plan
Amendments to the above identified agreement were approved by
the Registrant's Board of Directors on April 25, 1997:
3. EXERCISE OF OPTION. Except as otherwise set forth
below with respect to the acceleration of exercisability upon Disability (as
defined in Schedule A hereto) or death and subject to the earlier expiration of
this Option as herein provided, this Option may be exercised, by written notice
to the Company at its principal executive office addressed to the attention of
its Chief Financial Officer, at any time and from time to time after one year
after the date of grant hereof, but this Option shall not be exercisable for
more than a percentage of the aggregate number of shares offered by the Option
determined by the number of full years from the date of grant hereof to the
date of such exercise, in accordance with the following schedule:
NUMBER OF FULL YEARS PERCENTAGE OF SHARES PURCHASABLE
-------------------- --------------------------------
Less than 1 year 0%
1 year 25%
2 years 50%
3 years 75%
4 years 100%
Subject to the following, this Option may be exercised only by
Employee during his lifetime and while Employee remains an employee of the
Company:
(a) If Employee's employment with the Company terminates by
reason of normal retirement, Employee may exercise this Option
at any time during the period of five years following the date
of such termination, but only as to the number of shares
Employee was entitled to purchase hereunder as of the date his
employment so terminates, plus such additional number of shares,
if any, that the Committee (as defined in the Plan), in its sole
discretion, determines to be exercisable as of such retirement.
(b) If Employee dies within the five year period following
the date of Employee's termination of employment by reason of
normal retirement, Employee's estate, or the person who acquires
this Option by bequest or inheritance or by reason of the death
of Employee, may exercise this Option at any time during the
period of two years following the date of Employee's death, but
only as to the number of shares Employee was entitled to
purchase hereunder as of the date Employee's employment
terminated by reason of normal retirement.
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Exhibit 10a
(c) If Employee's employment with the Company terminates by
reason of Disability, Employee may exercise this Option at any
time during the period of five years following the date of such
termination, and the times at which portions of this Option
become exercisable shall be accelerated upon such termination
of employment by reason of Disability so that, regardless of
how long it has been held after the date of grant, this Option
shall be exercisable in full during such five year period for
100% of the shares purchasable hereunder.
(d) If Employee dies while in the employ of the Company or
within the five year period following the date of Employee's
termination of employment by reason of Disability, Employee's
estate, or the person who acquires this Option by bequest or
inheritance or by reason of the death of Employee, may exercise
this Option at any time during the period of two years
following the date of Employee's death, and the times at which
portions of this Option become exercisable shall be accelerated
upon the death of Employee so that, regardless of how long it
has been held after the date of grant, this Option shall be
exercisable in full during the two year period following the
date of Employee's death for 100% of the shares purchasable
hereunder.
(e) Notwithstanding anything to the contrary in this
Agreement, this Option may be transferred (in whole or in part
pursuant to such form as approved by the Company) by Employee
to (i) the spouse, children or grandchildren of Employee
("Immediate Family Members"), (ii) a trust or trusts for the
exclusive benefit of the Immediate Family Members and, if
applicable, Employee, (iii) a partnership or limited liability
company in which such Immediate Family Members and, if
applicable, Employee are the only partners or members, or (iv)
an organization that has been determined to be exempt under
Section 501(c)(3) of the Internal Revenue Code; provided,
however, that subsequent transfers of the Option shall be
prohibited, except that after the death or dissolution of the
transferee, as applicable, any exercisable portion of the
transferred Option may be exercised by the transferee's
personal representative or by any person empowered to do so
under the transferee's will or under the then applicable laws
of descent and distribution. Following transfer, the Option
shall continue to be subject to the same terms and conditions
as were applicable to Employee with respect to the Option
immediately prior to the transfer, including, without
limitation, vesting and the expiration provisions of Paragraphs
(a), (b), (c) and (d) above, which shall be applied "as if"
Employee continued to be the holder of the Option. No
transferred Option shall be exercisable unless arrangements
satisfactory to the Company have been made to satisfy any tax
withholding obligations the Company may have with respect to
the exercise of the Option. Further, the Company shall have no
obligation to provide any notices to an Option transferee of
any event, term or provision with respect to the Option,
including, without limitation, the early termination of the
Option on account of termination of Employee's employment.
If Employee's employment with the Company terminates other than by reason of
normal retirement, Disability or death, this Option (to the extent not exercised
prior thereto) shall terminate as of the date Employee's employment so
terminates. Notwithstanding any other provision of this Agreement, this Option
shall not be exercisable in any event after the expiration of ten years from the
date of grant hereof. The purchase price of shares as to which this Option is
exercised shall be paid in full in cash at the time of such exercise. Unless
and until a
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Exhibit 10a
certificate or certificates representing such shares shall have been issued by
the Company to Employee, or the person permitted to exercise this Option (i)
following the transfer of the Option as permitted by Paragraph (e) above or
(ii), in the event of Employee's death prior to any transfer (such person being
the "Option Holder"), neither Employee nor the Option Holder, as the case may
be, shall be, or have any of the rights or privileges of, a stockholder of the
Company with respect to shares acquirable upon an exercise of this Option.