Exhibit 10.75
R&B FALCON CORPORATION
STOCK OPTION AGREEMENT
This Stock Option Agreement ("Agreement") is made between
R&B Falcon Corporation, a Delaware corporation ("Company"), and Xxxx
X. Xxxx, Xx. ("Optionee") as of February 11, 1999 (the "Effective
Date").
WITNESSETH:
WHEREAS, the Committee which administers the R&B Falcon
Corporation 1998 Employee Long-Term Incentive Plan ("Plan") has
selected the Optionee to receive a nonqualified stock option under
the terms of the Plan as an incentive to the Optionee to remain in
the employ of the Company and contribute to the performance of the
Company, on the terms and subject to the conditions provided herein;
NOW THEREFORE, for and in consideration of these premises,
it is hereby agreed as follows:
1. As used herein, the terms set forth below shall have
the following respective meanings:
(a) "Disability" means Disability as defined in the
Employment Agreement; and
(b) "Employment Agreement" means that certain Employment
Agreement dated March 25, 1998 between the Optionee
and the Company.
2. The option awarded hereunder is issued in accordance
with and subject to all of the terms, conditions and provisions of
the Plan and administrative interpretations thereunder, if any, which
have been adopted by the Committee and are in effect on the date
hereof. Capitalized terms used but not defined herein shall have the
meanings assigned to such terms in the Plan.
3. On the terms and subject to the conditions contained
herein, the Company hereby grants to the Optionee an option (the
"Option") for a term of ten years ending on February 11, 2009
("Option Period") to purchase from the Company 184,121 shares
("Option Shares") of the Company's Common Stock, at a price equal to
$6.25 per share.
4. This Option shall not be exercisable, except upon the
death or Disability of the Optionee, until after 6 months immediately
following the Effective Date and thereafter shall be exercisable for
any number of shares up to and including the aggregate number of
shares subject to this Option, irrespective of whether the Optionee
is an employee of the Company at the time of any such exercise;
provided the number of shares as to which this Option becomes
exercisable shall, in each case, be reduced by the number of shares
theretofore purchased pursuant to the terms hereof.
5. The Option may be exercised by the Optionee, in whole
or in part, by giving written notice to the Compensation and Benefits
Department of the Company setting forth the number of Option Shares
with respect to which the option is to be exercised, accompanied by
payment for the shares to be purchased and any appropriate
withholding taxes, and specifying the address to which the
certificate for such shares is to be mailed (or to the extent
permitted by the Company, the written instructions referred to in the
last sentence of this section). Payment shall be by means of cash,
certified check, bank draft or postal money order payable to the
order of the Company. As promptly as practicable after receipt of
such written notification and payment, the Company shall deliver, or
cause to be delivered, to the Optionee certificates for the number of
Option Shares with respect to which the Option has been so exercised.
6. Subject to approval of the Committee, which shall not
be unreasonably withheld, the Optionee may pay for any Option Shares
with respect to which the Option is exercised by tendering to the
Company other shares of Common Stock at the time of the exercise or
partial exercise hereof. The certificates representing such other
shares of Common Stock must be accompanied by a stock power duly
executed with signature guaranteed in accordance with market
practice. The value of the Common Stock so tendered shall be its
Fair Market Value.
7. The Option shall not be transferable by the Optionee
otherwise than as expressly permitted by the Plan. During the
lifetime of the Optionee, the Option shall be exercisable only by her
or him. No transfer of the Option shall be effective to bind the
Company unless the Company shall have been furnished with written
notice thereof and a copy of such evidence as the Committee may deem
necessary to establish the validity of the transfer and the
acceptance by the transferee or transferees of the terms and
conditions hereof.
8. The Optionee shall have no rights as a stockholder
with respect to any Option Shares until the date of issuance of a
certificate for Option Shares purchased pursuant to this Agreement.
Until such time, the Optionee shall not be entitled to dividends or
to vote at meetings of the stockholders of the Company.
9. The Company may make such provisions as it may deem
appropriate for the withholding of any taxes which it determines is
required in connection with the option herein granted. The Optionee
may pay all or any portion of the taxes required to be withheld by
the Company or paid by the Optionee in connection with the exercise
of all or any portion of the option herein granted by electing to
have the Company withhold shares of Common Stock, or by delivering
previously owned shares of Common Stock, having a Fair Market Value
equal to the amount required to be withheld or paid. The Optionee
must make the foregoing election on or before the date that the
amount of tax to be withheld is determined ("Tax Date"). Any such
election is irrevocable and subject to disapproval by the Committee.
If the Optionee is subject to the short-swing profits recapture
provisions of Section 16(b) of the Exchange Act, any such election
shall be subject to the following additional restrictions:
(a) Such election may not be made within six months of the
grant of this option, provided that this limitation shall not apply
in the event of death or Disability.
(b) Such election must be made either in an Election Window
(as hereinafter defined) or at such other time as may be consistent
with Section 16(b) of the Exchange Act and the rules promulgated
thereunder. Where the Tax Date in respect of the exercise of all or
any portion of this Option is deferred until after such exercise and
the Optionee elects stock withholding, the full amount of shares of
Common Stock will be issued or transferred to the Optionee upon
exercise of this Option, but the Optionee shall be unconditionally
obligated to tender back to the Company on the Tax Date the number of
shares necessary to discharge with respect to such Option exercise
the greater of (i) the Company's withholding obligation and (ii) all
or any portion of the holder's federal and state tax obligation
attributable to the Option exercise. An Election Window is any
period commencing on the third business day following the Company's
release of a quarterly or annual summary statement of sales and
earnings and ending on the twelfth business day following such
release.
10. Upon the acquisition of any shares pursuant to the
exercise of the Option, the Optionee will enter into such written
representations, warranties and agreements as the Company may
reasonably request in order to comply with applicable securities laws
or with this Agreement.
11. The certificates representing the Option Shares
purchased by exercise of an option will be stamped or otherwise
imprinted with a legend in such form as the Company or its counsel
may require with respect to any applicable restrictions on sale or
transfer, and the stock transfer records of the Company will reflect
stop-transfer instructions, as appropriate, with respect to such
shares.
12. Unless otherwise provided herein, every notice
hereunder shall be in writing and shall be delivered by hand or by
registered or certified mail. All notices of the exercise by the
Optionee of any option hereunder shall be directed to R&B Falcon
Corporation, Attention: Benefits and Compensation Department, at the
Company's principal office address from time to time. Any notice
given by the Company to the Optionee directed to him or her at his or
her address on file with the Company shall be effective to bind any
other person who shall acquire rights hereunder. The Company shall
be under no obligation whatsoever to advise the Optionee of the
existence, maturity or termination of any of the Optionee's rights
hereunder and the Optionee shall be deemed to have familiarized
himself with all matters contained herein and in the Plan which may
affect any of the Optionee's rights or privileges hereunder.
13. Whenever the term "Optionee" is used herein under
circumstances applicable to any other person or persons to whom this
award, in accordance with the provisions of Paragraph 7, may be
transferred, the word "Optionee" shall be deemed to include such
person or persons. References to the masculine gender herein also
include the feminine gender for all purposes.
14. Notwithstanding any of the other provisions hereof,
the Optionee agrees that he or she will not exercise the Option, and
that the Company will not be obligated to issue any shares pursuant
to this Agreement, if the exercise of the Option or the issuance of
such shares of Common Stock would constitute a violation by the
Optionee or by the Company of any provision of any law or regulation
of any governmental authority or any national securities exchange.
15. This Agreement is subject to the Plan, a copy of which
will be provided the to Optionee upon written request. The terms and
provisions of the Plan (including any subsequent amendments thereto)
are incorporated herein by reference. In the event of a conflict
between any term or provision contained herein and a term or
provision of the Plan, the applicable terms and provisions of the
Plan will govern and prevail. All definitions of words and terms
contained in the Plan shall be applicable to this Agreement.
16. In the event of a corporate merger or other business
combination in which the Company is not the surviving entity, the
economic equivalent number of the voting shares of common stock of,
or participating interests in, the surviving entity, based on the
terms of such merger or other business combination, shall be
substituted for the number of Option Shares held by the Participant
hereunder, and the exercise price per share set out in Section 3
above shall be likewise adjusted, to reflect substantially the same
economic equivalent value of the Option Shares to the Participant
prior to any such merger or other business combination. In the event
of a split-off, spin-off or creating of a different class of common
stock of the Company (including, without limitation, a tracking
stock), the Participant shall receive an option to purchase an
equivalent number of the shares of common stock or voting interests
of such separate entity being split-off or spun-off or of the shares
of the new class of common stock of the Company, as if Participant
had owned the shares underlying the Option Shares on the record date
for any such split-off, spin-off or creation of a new class of common
stock of the Company, and the exercise price set out in Section 3
hereof and applicable to the options to purchase shares or the voting
interests of the new entity being split-off or spun-off shall be
adjusted to reflect substantially the same economic equivalent value
of the Option Shares to the Optionee prior to any such split-off,
spin-off or creation of a new class of common stock of the Company
IN WITNESS WHEREOF, this Agreement is effective as of the
11th of February, 1999.
R&B FALCON CORPORATION
By:_______________________________
Its:_______________________________
OPTIONEE
___________________________________
Xxxx X. Xxxx, Xx.
