Contract
Exhibit 10.2
2009
ROWAN COMPANIES, INC. INCENTIVE PLAN
THIS STOCK APPRECIATION RIGHT
AGREEMENT (this “Agreement”) is made as of the 5th day of May, 2009
(“Grant Date”), between Rowan Companies, Inc., a Delaware corporation (the
“Company”) and ____________ (the
“Participant”).
|
1.
|
Grant
of SAR. To carry out the purposes of the 2009 Rowan
Companies, Inc. Incentive Plan (the “Plan”), and subject to the conditions
described in this Agreement and the Plan, the Company hereby grants to the
Participant a stock appreciation right (“SAR”) with respect to ______
shares of common stock, $0.125 par value per share of the Company
(“Stock”), effective as of the Grant Date on the terms and conditions set
forth herein and in the Plan, which Plan is incorporated herein by
reference as a part of this Agreement. All capitalized terms
not otherwise defined herein shall have the meanings set forth in the
Plan; the Plan is incorporated herein by reference as a part of this
Agreement.
|
|
2.
|
Exercise
Price. The exercise price of Stock purchased pursuant to
the exercise of this SAR shall be $
per share.
|
|
3.
|
Exercise
of SAR. This SAR shall be exercisable in the manner
described below for one-third of the aggregate number of SARs on and after
the first anniversary of the Grant Date and an additional one-third on and
after each of the second and third anniversaries of the Grant Date;
provided, however, a SAR may be exercised only prior to its expiration
date and, except as otherwise provided below, only while the Participant
remains an Employee of the Company. This SAR shall not be
exercisable in any event after the expiration of ten years from the Grant
Date hereof. The SAR will terminate and cease to be
exerciseable upon the Participant’s termination of employment with the
Company, except that:
|
|
(a)
|
If
the Participant’s employment with the Company terminates by reason of
Retirement, the Participant may exercise this SAR at any time during the
period of five years following the date of such termination, but only as
to the number of SARs that the Participant was entitled to purchase
hereunder as of the date his employment so terminates, plus such
additional number of SARs, if any, that the Committee, in its sole
discretion, determines to be exercisable as of such
Retirement.
|
|
(b)
|
If
the Participant dies within the five-year period following the date of the
Participant’s termination of employment by reason of Retirement, the
Participant’s estate, or the person who acquires this SAR by bequest or
inheritance or otherwise by reason of the death of the Participant, may
exercise this SAR at any time during the period of two years following the
date of the Participant’s death, but only as to the number of SARs the
Participant was entitled to purchase hereunder as of the date the
Participant’s employment terminated by reason of
Retirement.
|
|
(c)
|
If
the Participant’s employment with the Company terminates by reason of
disability, the Participant may exercise this SAR in full at any time
during the period of five years following the date of such termination,
but only as to the number of SARs that the Participant was entitled to
purchase hereunder as of the date his employment so terminates, plus such
additional number of SARs, if any, that the Committee, in its sole
discretion, determines to be exercisable as of such
disability.
|
|
(d)
|
If
the Participant dies while in the employ of the Company or within the
five-year period following the date of the Participant’s termination of
employment by reason of disability, the Participant’s estate, or the
person who acquires this SAR by bequest or inheritance or by reason of the
death of the Participant, may exercise this SAR in full at any time during
the period of two years following the date of the Participant’s
death.
|
|
(e)
|
If
the Participant’s employment with the Company terminates other than by
reason of Retirement, disability, or death, this SAR (to the extent vested
as of the date of termination and not exercised prior thereto) shall
terminate upon the expiration of 90 days following the date the
Participant’s employment so
terminates.
|
|
4.
|
Exercise. Subject
to the limitations set forth herein and in the Plan, this SAR may be
exercised by written notice provided to the Company, and may only be
exercised with respect to a number of SAR Shares with respect to which the
SAR is then exercisable. Upon exercise of the SAR, the product
of the number of the SARs exercised multiplied by the excess of the Fair
Market Value (determined in accordance with the terms of the Plan) over
the Exercise Price shall become payable to the Participant in shares of
Stock, or, in the sole discretion of the Committee, in
cash. Such Stock issuance or single lump-sum cash payment shall
be made as soon as practicable after becoming payable, but no later than
45 days after the date of exercise. Notwithstanding anything to the
contrary contained herein, the Participant agrees that he will not
exercise the SAR granted pursuant hereto, and that the Company will not be
obligated to issue any Stock pursuant to this Award Agreement, if the
exercise of the SAR or the issuance of such Stock would constitute a
violation by the Participant or by the Company of any provision of any law
or regulation of any governmental authority or any stock exchange or
transaction quotation system.
|
|
5.
|
Retirement. For
purposes of the Agreement and pursuant to the terms of the Plan,
Retirement of an Employee shall have occurred if, as of the Employee’s
date of termination of employment:
|
(a) in the
case of an Employee who is an employee of the Company or one of its subsidiaries
(other than XxXxxxxxxx, Inc. or its subsidiaries, the employees of which are
covered in (b) below), the Employee is a minimum of 60 years old and has
satisfied the requirements for normal retirement pursuant to the policies of the
Company in place at the time of termination; or
(b) in the
case of an Employee who is an employee of XxXxxxxxxx, Inc. or one of its
subsidiaries, the Employee has satisfied the requirements for either normal or
late retirement pursuant to the polices of XxXxxxxxxx, Inc. in place at the time
of termination.
Determination
of the date of termination of employment by reason of Retirement and the
satisfaction of the requirements for “Retirement” shall be based on such
evidence as the Committee may require and a determination by the Committee of
such date of termination and satisfaction shall be final and controlling on all
interested parties.
|
6.
|
Status
of Stock. The Company intends to register for issuance
under the Securities Act of 1933, as amended (the “Act”), the shares of
Stock acquirable upon exercise of this SAR and to keep such registration
effective throughout the period that this SAR is
exercisable. In the absence of such effective registration or
an available exemption from registration under the Act, issuance of shares
of Stock acquirable upon exercise of the SAR will be delayed until
registration of such shares is effective or an exemption from registration
under the Act is available. The Company intends to use its
reasonable efforts to ensure that no such delay will occur. In
the event exemption from registration under the Act is available upon an
exercise of this SAR, the Participant (or the person permitted to exercise
this SAR in the event of the Participant’s incapacity or death), if
requested by the Company to do so, will execute and deliver to the Company
in writing an agreement containing such provisions as the Company may
require assuring compliance with applicable securities
laws. The Company shall incur no liability to the Participant
for failure to register the Stock or maintain the
registration.
|
The
Participant agrees that the shares of Stock, which the Participant may acquire
by exercising this SAR, will not be sold or otherwise disposed of in any manner
that would constitute a violation of any applicable securities laws, whether
federal or state. The Participant also agrees (i) that the
certificates representing the shares of Stock purchased under this SAR may bear
such legend or legends as the Committee deems appropriate in order to assure
compliance with applicable securities laws, (ii) that the Company may refuse to
register the transfer of the shares of Stock purchased under this SAR on the
stock transfer records of the Company if such proposed transfer would in the
opinion of counsel satisfactory to the Company constitute a violation of any
applicable securities law and (iii) that the Company may give related
instructions to its transfer agent, if any, to stop registration of the transfer
of the shares of Stock purchased under this SAR.
|
7.
|
Employment
Relationship. For purposes of this Agreement, the
Participant shall be considered to be in the employment of the Company as
long as the Participant remains an Employee of either the Company, a
parent or subsidiary corporation (as defined in Code Section 424) of the
Company, or a corporation or a parent or subsidiary of such corporation
assuming or substituting a new SAR for this SAR. Any question
as to whether and when there has been a termination of such employment,
and the cause and date of such termination, shall be based on such
evidence as the Committee may require and a determination by the Committee
as to the cause and date of such termination shall be final and
controlling on all interested
parties.
|
|
8.
|
Withholding
of Tax. Upon an exercise of this SAR, the Company is
authorized in its discretion to satisfy any withholding requirement out of
any cash or shares of Stock distributable to the Participant upon such
exercise.
|
|
9.
|
Reorganization
of the Company. The
existence of this Agreement shall not affect in any way the right or power
of the Company or its stockholders to make or authorize any or all
adjustments, recapitalizations, reorganizations or other changes in the
Company’s capital structure or its business; any merger or consolidation
of the Company; any issuance of bonds, debentures, preferred or prior
preference stock ahead of or affecting the Stock or the rights thereof;
the dissolution or liquidation of the Company; any sale or transfer of all
or any part of its assets or business; or any other corporate act or
proceeding, whether of a similar character or
otherwise.
|
|
10.
|
Recapitalization
Events. In the
event of stock dividends, spin-offs of assets or other extraordinary
dividends, stock splits, combinations of shares, recapitalizations,
mergers, consolidations, reorganizations, liquidations, issuances of
rights or warrants and similar transactions or events involving the
Company (“Recapitalization Events”), then for all purposes references
herein to Stock shall mean and include all securities or other property
(other than cash) that holders of Stock of the Company are entitled to
receive in respect of Stock by reason of each successive Recapitalization
Event, and the exercise price of the SAR shall be adjusted as deemed
necessary or appropriate in the sole discretion of the Committee to
prevent enlargement or dilution of the Participant’s rights under this
Agreement.
|
|
11.
|
Transfer
of SAR. Except as provided herein, all rights granted
hereunder shall not be transferable other than by will or the laws of
descent and distribution and shall be exercisable during the Participant’s
lifetime only by the Participant or, in the case of the Participant’s
death or incapacity, by the Participant’s guardian or legal
representative. Any purported assignment, alienation, pledge,
attachment, sale, transfer or encumbrance of this SAR that does not
satisfy the requirements set forth hereunder shall be void and
unenforceable against the Company.
|
|
12.
|
Severability. In the
event that any provision of this Agreement shall be held illegal, invalid,
or unenforceable for any reason, such provision shall be fully severable
and shall not affect the remaining provisions of this Agreement, and the
Agreement shall be construed and enforced as if the illegal, invalid or
unenforceable provision had never been included
herein.
|
|
13.
|
Certain
Restrictions. By
executing this Agreement, the Participant acknowledges that he will enter
into such written representations, warranties and agreements and execute
such documents as the Company may reasonably request in order to comply
with this Agreement, the securities laws or any other applicable laws,
rules or regulations, or the terms of the
Plan.
|
|
14.
|
Recoupment. Notwithstanding
any provision of this Agreement to the contrary, the Committee may, in its
sole discretion:
|
|
(a)
|
recoup
from Participants all or a portion of the Stock issued or cash paid under
this Agreement if the Company’s reported financial or operating results
are materially and negatively restated within five years of the issuance
or payment of such amounts and may cancel any SARs not yet exercised
(whether or not vested); and
|
|
(b)
|
recoup
from Participants who, in the Committee’s judgment, engaged in conduct
which was fraudulent, negligent or not in good faith, and which disrupted,
damaged, impaired or interfered with the business, reputation or Employees
of the Company or its Affiliates or which caused a subsequent adjustment
or restatement of the Company’s reported financial statements, all or a
portion of the Stock issued or cash paid under this Agreement within five
years of such conduct and may cancel any SARs not yet exercised (whether
or not vested).
|
|
15.
|
Stockholder
Rights. Prior to exercise and receipt of any
underlying Stock, a Participant shall have no rights of a stockholder with
respect to the shares of Stock subject to the
SAR.
|
|
16.
|
Amendment
and Termination. Except as otherwise provided in
the Plan or this Agreement, no amendment or termination of this Agreement
shall be made by the Company without the written consent of the
Participant.
|
|
17.
|
Code
Section 409A; No Guarantee of Tax
Consequences. This Award of SARs is intended to be
exempt from Code Section 409A. The Company makes no commitment
or guarantee to the Participant that any federal or state tax treatment
will apply or be available to any person eligible for benefits under this
Agreement.
|
|
18.
|
Binding
Effect. This Agreement shall be binding upon and inure
to the benefit of any successors to the Company and all persons lawfully
claiming under the Participant.
|
|
19.
|
IN WITNESS WHEREOF, the
Company has caused this Agreement to be duly executed by its officer thereunto
duly authorized, and the Participant has executed this Agreement, all as of the
day and year first above written.
ROWAN
COMPANIES, INC.
By: Date: ,
20__
PARTICIPANT:
Date: ,
20__
Address:
