Common use of Initial Stock Option Clause in Contracts

Initial Stock Option. On the Effective Date of this Agreement (the "Date of Grant"), Company shall grant to Executive an option (the "Initial Option") to purchase 175,000 shares of Company's common stock ("Stock") pursuant to The Marine Drilling 1992 Long Term Incentive Plan, as amended (the "Plan"). The purchase price for each share of Stock subject to the Initial Option shall be $18.125 per share. Subject to the terms of the Plan and the agreement to be executed by Company and Executive evidencing the Initial Option, the Initial Option shall (i) have a term of 10 years (which term shall begin on the Date of Grant), (ii) vest and become exercisable with respect to (A) 25 % of the shares covered thereby on the first anniversary of the Date of Grant, (B) an additional 25 % of the shares covered thereby on the second anniversary of the Date of Grant, (C) an additional 25% of the shares covered thereby on the third anniversary of the Date of Grant, and (D) an additional 25% of the shares covered thereby on the fourth anniversary of the Date of Grant, and (iii) become vested and fully exercisable by Executive upon the occurrence of a "Change in Control" (as such term is defined in the Plan) while Executive is employed by Company.