AMENDED EMPLOYMENT AGREEMENT - JAMES C. DAY
 
                                                                    EXHIBIT 10.2
 
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                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT
 
 
 
 
 
                                 by and between
 
 
 
 
 
                           NOBLE DRILLING CORPORATION
 
 
 
                                       and
 
 
 
                                  JAMES C. DAY
 
 
 
 
 
 
 
                                 April 30, 2002
 
 
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                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT
                                TABLE OF CONTENTS
 
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1.       Employment..............................................................................................2
2.       Employment Term.........................................................................................2
         (a)      Term...........................................................................................2
         (b)      Relationship Prior to Effective Date...........................................................2
3.       Positions and Duties....................................................................................2
4.       Compensation and Related Matters........................................................................3
         (a)      Base Salary....................................................................................3
         (b)      Annual Bonus...................................................................................4
         (b)      Employee Benefits..............................................................................4
                  (i)      Incentive, Savings, and Retirement Plans..............................................4
                  (ii)     Welfare Benefit Plans.................................................................4
         (d)      Expenses.......................................................................................5
         (e)      Fringe Benefits................................................................................5
         (f)      Vacation.......................................................................................5
5.       Termination of Employment...............................................................................5
         (a)      Death..........................................................................................5
         (b)      Disability.....................................................................................5
         (c)      Termination by Company.........................................................................6
         (d)      Termination by Executive.......................................................................6
         (e)      Notice of Termination..........................................................................7
         (f)      Date of Termination............................................................................8
6.       Obligations of the Company Upon Termination.............................................................8
         (a)      Good Reason or During the Window Period; Other Than for Cause, Death,
                  or Disability..................................................................................8
         (b)      Death.........................................................................................10
         (c)      Disability....................................................................................11
         (d)      Cause; Other than for Good Reason or During the Window Period.................................11
7.       Certain Additional Payments by the Company.............................................................12
8.       Representations and Warranties.........................................................................14
9.       Confidential Information...............................................................................14
10.      Certain Definitions....................................................................................15
         (a)      Effective Date................................................................................15
         (b)      Change of Control Period......................................................................15
         (c)      Change of Control.............................................................................15
11.      Full Settlement........................................................................................17
12.      No Effect on Other Contractual Rights..................................................................18
13.      Indemnification; Directors and Officers Insurance......................................................18
14.      Injunctive Relief......................................................................................18
15.      Governing Law..........................................................................................19
16.      Notices................................................................................................19
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17.      Binding Effect; Assignment; No Third Party Benefit.....................................................19
18.      Miscellaneous..........................................................................................20
         (a)      Amendment.....................................................................................20
         (b)      Waiver........................................................................................20
         (c)      Withholding Taxes.............................................................................20
         (d)      Nonalienation of Benefits.....................................................................20
         (e)      Severability..................................................................................20
         (f)      Entire Agreement..............................................................................20
         (g)      Captions......................................................................................21
         (h)      References....................................................................................21
19.      Agreement Subject to Merger............................................................................21
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                              AMENDED AND RESTATED
                              EMPLOYMENT AGREEMENT
 
         This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement"),
dated as of April 30, 2002, by and between NOBLE DRILLING CORPORATION, a
Delaware corporation (the "Company"), and JAMES C. DAY (the "Executive");
 
                                   WITNESSETH:
 
         WHEREAS, the Company and the Executive have previously entered into an
Employment Agreement dated October 22, 1998 (the "Original Employment
Agreement"); and
 
         WHEREAS, pursuant to the Agreement and Plan of Merger, dated as of
March 11, 2002 (the "Merger Agreement"), among the Company, Noble Corporation, a
Cayman Islands exempted company ("Noble-Cayman"), Noble Holding (U.S.)
Corporation, a Delaware corporation, and Noble Cayman Acquisition Corporation, a
Delaware corporation, the Company will become an indirect, wholly owned
subsidiary of Noble-Cayman by way of the merger of Noble Cayman Acquisition
Corporation with and into the Company, and Noble-Cayman will become the parent
company of the Noble corporate group, including the Company (the "Merger"); and
 
         WHEREAS, the parties desire to amend and restate the Original
Employment Agreement to adjust the definition of "Change of Control" (as defined
below) to account for the Merger; and
 
         WHEREAS, this Agreement will take effect as of the "Effective Time" of
the Merger (as used herein, the term "Effective Time" has the meaning assigned
to such term in the Merger Agreement); and
 
         WHEREAS, Noble-Cayman will guarantee the performance by the Company of
its obligations hereunder; and
 
         WHEREAS, the Board of Directors of the Company (the "Board") has
determined that it is in the best interests of the Company and its stockholders
to assure that the Company and/or its affiliated companies (as defined below),
including Noble-Cayman, will have the continued dedication of the Executive,
notwithstanding the possibility, threat or occurrence of a Change of Control (as
defined in Paragraph 10(c)); and
 
         WHEREAS, the Board believes it is imperative to diminish the inevitable
distraction of the Executive by virtue of the personal uncertainties and risks
created by a pending or threatened Change of Control and to encourage the
Executive's full attention and dedication to the Company and/or its affiliated
companies currently and in the event of any pending or threatened Change of
Control, and to provide the Executive with compensation and benefits upon a
Change of Control which ensure that the compensation and benefits expectations
of the Executive will be satisfied and which are competitive with those of other
corporations; and
 
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         WHEREAS, in order to accomplish these objectives, the Board has caused
the Company to amend and restate this Agreement effective as of the Effective
Time;
 
         NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the Company and the Executive hereby agree to amend and restate the
Original Employment Agreement in its entirety, subject to the consummation of
the Merger and effective as of the Effective Time, as follows:
 
         1. Employment. The Company agrees that the Company or an affiliated
company will continue the Executive in its employ, and the Executive agrees to
remain in the employ of the Company or an affiliated company, for the period set
forth in Paragraph 2(a), in the positions and with the duties and
responsibilities set forth in Paragraph 3, and upon the other terms and
conditions herein provided. As used in this Agreement, the term "affiliated
company" shall include any company controlled by, controlling or under common
control with the Company.
 
         2. Employment Term.
 
         (a) Term. The employment of the Executive by the Company or an
affiliated company as provided in Paragraph 1 shall be for the period commencing
on the Effective Date (as defined in Paragraph 10(a)) through and ending on the
third anniversary of such date (the "Employment Term").
 
         (b) Relationship Prior to Effective Date. The Executive and the Company
acknowledge that, except as may otherwise be provided under any written
agreement between the Executive and the Company other than this Agreement, the
employment of the Executive by the Company is "at will" and, prior to the
Effective Date, may be terminated by either the Executive or the Company at any
time. Moreover, if prior to the Effective Date, the Executive's employment with
the Company terminates, then the Executive shall have no further rights under
this Agreement. For purposes of this Paragraph 2(b) only, the term "Company"
shall mean and include the company that employs Executive, whether Noble
Drilling Corporation or an affiliated company of Noble Drilling Corporation.
 
         3. Positions and Duties.
 
         (a) During the Employment Term, the Executive's position (including
status, offices, titles and reporting requirements), duties, functions,
responsibilities and authority shall be at least commensurate in all material
respects with the most significant of those held or exercised by or assigned to
the Executive in respect of the Company or any affiliated company at any time
during the 120-day period immediately preceding the Effective Date.
 
         (b) During the Employment Term, the Executive shall devote the
Executive's full time, skill and attention, and the Executive's reasonable best
efforts, during normal business hours to the business and affairs of the
Company, and in furtherance of the business and affairs of its affiliated
companies, to the extent necessary to discharge faithfully and efficiently the
duties and responsibilities delegated and assigned to the Executive herein or
pursuant hereto, except for usual, ordinary and customary periods of vacation
and absence due to illness or other
 
 
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disability; provided, however, that the Executive may (i) serve on
industry-related, civic or charitable boards or committees, (ii) with the
approval of the Board of Directors of Noble-Cayman (the "Noble-Cayman Board"),
serve on corporate boards or committees, (iii) deliver lectures, fulfill
speaking engagements or teach at educational institutions, and (iv) manage the
Executive's personal investments, so long as such activities do not
significantly interfere with the performance and fulfillment of the Executive's
duties and responsibilities as an employee of the Company or an affiliated
company in accordance with this Agreement and, in the case of the activities
described in clause (ii) of this proviso, will not, in the good faith judgment
of the Noble-Cayman Board, constitute an actual or potential conflict of
interest with the business of the Company or an affiliated company. It is
expressly understood and agreed that, to the extent that any such activities
have been conducted by the Executive during the term of the Executive's
employment by the Company or its affiliated companies prior to the Effective
Date consistent with the provisions of this Paragraph 3(b), the continued
conduct of such activities (or of activities similar in nature and scope
thereto) subsequent to the Effective Date shall not thereafter be deemed to
interfere with the performance and fulfillment of the Executive's duties and
responsibilities to the Company and its affiliated companies.
 
         (c) In connection with the Executive's employment hereunder, the
Executive shall be based at the location where the Executive was regularly
employed immediately prior to the Effective Date or any office which is the
headquarters of the Company or Noble-Cayman and is less than 50 miles from such
location, subject, however, to required travel on the business of the Company
and its affiliated companies to an extent substantially consistent with the
Executive's business travel obligations during the three-year period immediately
preceding the Effective Date.
 
         (d) All services that the Executive may render to the Company or any of
its affiliated companies in any capacity during the Employment Term shall be
deemed to be services required by this Agreement and consideration for the
compensation provided for herein.
 
         4. Compensation and Related Matters.
 
         (a) Base Salary. During the Employment Term, the Executive shall
receive an annual base salary ("Base Salary") at least equal to 12 times the
highest monthly base salary paid or payable, including any base salary that has
been earned but deferred, to the Executive by the Company and its affiliated
companies in respect of the 12-month period immediately preceding the month in
which the Effective Date occurs. The Base Salary shall be payable in
installments in accordance with the general payroll practices of the Company in
effect at the time such payment is made, but in no event less frequently than
monthly, or as otherwise mutually agreed upon. During the Employment Term, the
Executive's Base Salary shall be subject to such increases (but not decreases)
as may be determined from time to time by the Noble-Cayman Board in its sole
discretion; provided, however, that the Executive's Base Salary (i) shall be
reviewed by the Noble-Cayman Board no later than 12 months after the last salary
increase awarded to the Executive prior to the Effective Date and thereafter at
least annually, with a view to making such upward adjustment, if any, as the
Noble-Cayman Board deems appropriate, and (ii) shall be increased at any time
and from time to time as shall be substantially consistent with increases in
base salary generally awarded in the ordinary course of business to the
Executive's
 
 
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peer executives of the Company or any of its affiliated companies. Base Salary
shall not be reduced after any such increase. The term Base Salary as used in
this Agreement shall refer to the Base Salary as so increased. Payments of Base
Salary to the Executive shall not be deemed exclusive and shall not prevent the
Executive from participating in any employee benefit plans, programs or
arrangements of the Company and its affiliated companies in which the Executive
is entitled to participate. Payments of Base Salary to the Executive shall not
in any way limit or reduce any other obligation of the Company hereunder, and no
other compensation, benefit or payment to the Executive hereunder shall in any
way limit or reduce the obligation of the Company regarding the Executive's Base
Salary hereunder.
 
         (b) Annual Bonus. In addition to Base Salary, the Executive shall be
awarded, in respect of each fiscal year of the Company ending during the
Employment Term, an annual bonus (the "Annual Bonus") in cash in an amount at
least equal to the Executive's highest aggregate bonus under all Company bonus
plans, programs, arrangements and awards (including the Company's Short-Term
Incentive Plan and any successor plan) in respect of any fiscal year in the
three full fiscal year period ended immediately prior to the Effective Date
(annualized for any fiscal year consisting of less than 12 full months or with
respect to which the Executive has been employed by the Company or any of its
affiliated companies for less than 12 full months) (such highest amount is
hereinafter referred to as the "Recent Annual Bonus"). Each such Annual Bonus
shall be paid no later than the end of the third month of the fiscal year next
following the fiscal year in respect of which the Annual Bonus is awarded,
unless the Executive shall elect to defer the receipt of such Annual Bonus.
 
         (c) Employee Benefits.
 
                  (i) Incentive, Savings and Retirement Plans. During the
         Employment Term, the Executive shall be entitled to participate in all
         incentive, savings and retirement plans, programs and arrangements
         applicable generally to the Executive's peer executives of the Company
         and its affiliated companies, but in no event shall such plans,
         programs and arrangements provide the Executive with incentive
         opportunities (measured with respect to both regular and special
         incentive opportunities, to the extent, if any, that such distinction
         is applicable), savings opportunities and retirement benefit
         opportunities, in each case, less favorable, in the aggregate, than the
         most favorable of those provided by the Company and its affiliated
         companies for the Executive under such plans, programs and arrangements
         as in effect at any time during the 120-day period immediately
         preceding the Effective Date or, if more favorable to the Executive,
         those provided generally at any time after the Effective Date to the
         Executive's peer executives of the Company and its affiliated
         companies.
 
                  (ii) Welfare Benefit Plans. During the Employment Term, the
         Executive and/or the Executive's family, as the case may be, shall be
         eligible to participate in and shall receive all benefits under all
         welfare benefit plans, programs and arrangements provided by the
         Company and its affiliated companies (including, without limitation,
         medical, prescription, dental, disability, salary continuance, employee
         life, group life, accidental death and travel accident insurance plans,
         programs and arrangements) to the extent applicable generally to the
         Executive's peer executives of the Company and its
 
 
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         affiliated companies, but in no event shall such plans, programs and
         arrangements provide the Executive with welfare benefits that are less
         favorable, in the aggregate, than the most favorable of such plans,
         programs and arrangements as in effect for the Executive at any time
         during the 120-day period immediately preceding the Effective Date or,
         if more favorable to the Executive, those provided generally at any
         time after the Effective Date to the Executive's peer executives of the
         Company and its affiliated companies.
 
         (d) Expenses. During the Employment Term, the Executive shall be
entitled to receive prompt reimbursement for all reasonable expenses incurred by
the Executive in performing the Executive's duties and responsibilities
hereunder in accordance with the most favorable policies, practices and
procedures of the Company and its affiliated companies as in effect for the
Executive at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in effect generally at
any time thereafter with respect to the Executive's peer executives of the
Company and its affiliated companies.
 
         (e) Fringe Benefits. During the Employment Term, the Executive shall be
entitled to fringe benefits, including, without limitation, tax and financial
planning services, payment of club dues and, if applicable, use of an automobile
and payment of related expenses, in accordance with the most favorable policies,
practices and procedures of the Company and its affiliated companies as in
effect for the Executive at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive, as in
effect generally at any time after the Effective Date with respect to the
Executive's peer executives of the Company and its affiliated companies.
 
         (f) Vacation. During the Employment Term, the Executive shall be
entitled to paid vacation and such other paid absences, whether for holidays,
illness, personal time or any similar purposes, in accordance with the most
favorable policies, practices and procedures of the Company and its affiliated
companies as in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the Executive,
as in effect generally at any time after the Effective Date with respect to the
Executive's peer executives of the Company and its affiliated companies.
 
         5. Termination of Employment.
 
         (a) Death. The Executive's employment shall terminate automatically
upon the Executive's death during the Employment Term.
 
         (b) Disability. If the Company determines in good faith that the
Disability (as defined below) of the Executive has occurred during the
Employment Term, the Company may give the Executive notice of its intention to
terminate the Executive's employment. In such event, the Executive's employment
hereunder shall terminate effective on the 30th day after receipt of such notice
by the Executive (the "Disability Effective Date"); provided, that within the
30-day period after such receipt, the Executive shall not have returned to
full-time performance of the Executive's duties. For purposes of this Agreement,
"Disability" shall mean the absence of the Executive from the Executive's duties
hereunder on a full-time basis for an aggregate of 180 days
 
 
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within any given period of 270 consecutive days (in addition to any statutorily
required leave of absence and any leave of absence approved by the Company) as a
result of incapacity of the Executive, despite any reasonable accommodation
required by law, due to bodily injury or disease or any other mental or physical
illness, which will, in the opinion of a physician selected by the Company or
its insurers and acceptable to the Executive or the Executive's legal
representative, be permanent and continuous during the remainder of the
Executive's life.
 
         (c) Termination by Company. The Company may terminate the Executive's
employment hereunder for Cause (as defined below). For purposes of this
Agreement, "Cause" shall mean:
 
                  (i) the willful and continued failure of the Executive to
         perform substantially the Executive's duties hereunder (other than any
         such failure resulting from bodily injury or disease or any other
         incapacity due to mental or physical illness) after a written demand
         for substantial performance is delivered to the Executive by the Board
         or the Noble-Cayman Board, or the Chief Executive Officer of the
         Company or Noble-Cayman, which specifically identifies the manner in
         which the Board or the Noble-Cayman Board, or the Chief Executive
         Officer of the Company or Noble-Cayman, believes the Executive has not
         substantially performed the Executive's duties; or
 
                  (ii) the willful engaging by the Executive in illegal conduct
         or gross misconduct that is materially and demonstrably detrimental to
         the Company and/or its affiliated companies, monetarily or otherwise.
 
For purposes of this provision, no act, or failure to act, on the part of the
Executive shall be considered "willful" unless done, or omitted to be done, by
the Executive in bad faith or without reasonable belief that the Executive's
action or omission was in the best interests of Noble-Cayman. Any act, or
failure to act, based upon authority given pursuant to a resolution duly adopted
by the Board or the Noble-Cayman Board or upon the instructions of the Chief
Executive Officer or another senior officer of Noble-Cayman or based upon the
advice of counsel for the Company shall be conclusively presumed to be done, or
omitted to be done, by the Executive in good faith and in the best interests of
the Company and its affiliated companies. The cessation of employment of the
Executive shall not be deemed to be for Cause unless and until there shall have
been delivered to the Executive a copy of a resolution duly adopted by the
affirmative vote of not less than two-thirds of the entire membership of the
Noble-Cayman Board then in office at a meeting of the Noble-Cayman Board called
and held for such purpose (after reasonable notice is provided to the Executive
and the Executive is given an opportunity, together with counsel, to be heard
before the Noble-Cayman Board) finding that, in the good faith opinion of the
Noble-Cayman Board, the Executive is guilty of the conduct described in
subparagraph (i) or (ii) above, and specifying the particulars thereof in
detail.
 
         (d) Termination by Executive. The Executive may terminate the
Executive's employment hereunder (i) at any time during the Employment Term for
Good Reason (as defined below) or (ii) during the Window Period (as defined
below) without any reason.
 
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For purposes of this Agreement, the "Window Period" shall mean the 30-day period
immediately following the first anniversary of the Effective Date, and "Good
Reason" shall mean any of the following (without the Executive's express written
consent):
 
                  (i) the assignment to the Executive of any duties inconsistent
         in any respect with the Executive's position (including status,
         offices, titles and reporting requirements), duties, functions,
         responsibilities or authority as contemplated by Paragraph 3(a) of this
         Agreement, or any other action by the Company or Noble-Cayman that
         results in a diminution in such position, duties, functions,
         responsibilities or authority, excluding for this purpose an isolated,
         insubstantial and inadvertent action not taken in bad faith and which
         is remedied by the Company or Noble-Cayman promptly after receipt of
         notice thereof given by the Executive;
 
                  (ii) any failure by the Company to comply with any of the
         provisions of Paragraph 4 of this Agreement, other than an isolated,
         insubstantial and inadvertent action not taken in bad faith and which
         is remedied by the Company promptly after receipt of notice thereof
         given by the Executive;
 
                  (iii) the Company's requiring the Executive to be based at any
         office or location other than as provided in Paragraph 3(c) of this
         Agreement or the Company's requiring the Executive to travel on the
         Company's or its affiliated companies' business to a substantially
         greater extent than during the three-year period immediately preceding
         the Effective Date;
 
                  (iv) any failure by the Company to comply with and satisfy
         Paragraph 17(c) of this Agreement; or
 
                  (v) any purported termination by the Company of the
         Executive's employment hereunder otherwise than as expressly permitted
         by this Agreement, and for purposes of this Agreement, no such
         purported termination shall be effective.
 
For purposes of this Paragraph 5(d), any good faith determination of "Good
Reason" made by the Executive shall be conclusive.
 
         (e) Notice of Termination. Any termination of the Executive's
employment hereunder by the Company or by the Executive (other than a
termination pursuant to Paragraph 5(a)) shall be communicated by a Notice of
Termination (as defined below) to the other party hereto. For purposes of this
Agreement, a "Notice of Termination" shall mean a notice which (i) indicates the
specific termination provision in this Agreement relied upon, (ii) in the case
of a termination for Disability, Cause or Good Reason, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provision so indicated, and (iii) specifies
the Date of Termination (as defined in Paragraph 5(f) below); provided, however,
that notwithstanding any provision in this Agreement to the contrary, a Notice
of Termination given in connection with a termination for Good Reason shall be
given by the Executive within a reasonable period of time, not to exceed 120
days, following the occurrence of the event giving rise to such right of
termination. The failure by the Company or
 
 
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the Executive to set forth in the Notice of Termination any fact or circumstance
which contributes to a showing of Disability, Cause or Good Reason shall not
waive any right of the Company or the Executive hereunder or preclude the
Company or the Executive from asserting such fact or circumstance in enforcing
the Company's or the Executive's rights hereunder.
 
         (f) Date of Termination. For purposes of this Agreement, the "Date of
Termination" shall mean the effective date of termination of the Executive's
employment hereunder, which date shall be (i) if the Executive's employment is
terminated by the Executive's death, the date of the Executive's death, (ii) if
the Executive's employment is terminated because of the Executive's Disability,
the Disability Effective Date, (iii) if the Executive's employment is terminated
by the Company (or applicable affiliated company) for Cause or by the Executive
for Good Reason, the date on which the Notice of Termination is given, (iv) if
the Executive's employment is terminated pursuant to Paragraph 2(a), the date on
which the Employment Term ends pursuant to Paragraph 2(a) due to a party's
delivery of a Notice of Termination thereunder, and (v) if the Executive's
employment is terminated for any other reason, the date specified in the Notice
of Termination, which date shall in no event be earlier than the date such
notice is given; provided, however, that if within 30 days after any Notice of
Termination is given, the party receiving such Notice of Termination notifies
the other party that a dispute exists concerning the termination, the Date of
Termination shall be the date on which the dispute is finally determined, either
by mutual written agreement of the parties or by a final judgment, order or
decree of a court of competent jurisdiction (the time for appeal therefrom
having expired and no appeal having been perfected).
 
         6. Obligations of the Company upon Termination.
 
         (a) Good Reason or During the Window Period; Other Than for Cause,
Death or Disability. If, during the Employment Term, the Company (or applicable
affiliated company) shall terminate the Executive's employment hereunder other
than for Cause or Disability or the Executive shall terminate the Executive's
employment either for Good Reason or without any reason during the Window
Period:
 
                  (i) the Company shall pay to the Executive in a lump sum in
         cash within 30 days after the Date of Termination the aggregate of the
         following amounts:
 
                           (A) the sum of (1) the Executive's Base Salary
                  through the Date of Termination to the extent not theretofore
                  paid, (2) the product of (x) the greater of (I) the Recent
                  Annual Bonus and (II) the Annual Bonus paid or payable,
                  including by reason of any deferral, to the Executive (and
                  annualized for any fiscal year consisting of less than 12 full
                  months or for which the Executive has been employed by the
                  Company or any of its affiliated companies for less than 12
                  full months) in respect of the most recently completed fiscal
                  year of the Company during the Employment Term, if any (such
                  greater amount hereinafter referred to as the "Highest Annual
                  Bonus"), and (y) a fraction, the numerator of which is the
                  number of days in the current fiscal year through the Date of
                  Termination, and the denominator of which is 365, and (3) any
                  compensation previously deferred by the Executive (together
                  with any accrued interest or earnings thereon) and any
 
 
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                  accrued vacation pay, in each case to the extent not
                  theretofore paid (the sum of the amounts described in clauses
                  (1), (2) and (3) are hereinafter referred to as the "Accrued
                  Obligations"); and
 
                           (B) an amount (such amount is hereinafter referred to
                  as the "Severance Amount") equal to the product of (1) three
                  and (2) the sum of (x) the Executive's Base Salary and (y) the
                  Highest Annual Bonus; and
 
                           (C) a separate lump-sum supplemental retirement
                  benefit (the amount of such benefit hereinafter referred to as
                  the "Supplemental Retirement Amount") equal to the difference
                  between (1) the actuarial equivalent (utilizing for this
                  purpose the actuarial assumptions utilized with respect to the
                  qualified defined benefit retirement plan of the Company and
                  its affiliated companies in which the Executive is eligible to
                  participate (or any successor plan thereto) (the "Retirement
                  Plan") during the 120-day period immediately preceding the
                  Effective Date) of the benefit payable under the Retirement
                  Plan and any supplemental and/or excess retirement plan of the
                  Company and its affiliated companies providing benefits for
                  the Executive (the "SERP") which the Executive would receive
                  if the Executive's employment continued at the compensation
                  level provided for in Paragraphs 4(a) and 4(b)(i) for the
                  remainder of the Employment Term, assuming for this purpose
                  that all accrued benefits are fully vested and that benefit
                  accrual formulas are no less advantageous to the Executive
                  than those in effect during the 120-day period immediately
                  preceding the Effective Date, and (2) the actuarial equivalent
                  (utilizing for this purpose the actuarial assumptions utilized
                  with respect to the Retirement Plan during the 120-day period
                  immediately preceding the Effective Date) of the Executive's
                  actual benefit (paid or payable), if any, under the Retirement
                  Plan and the SERP; and
 
                  (ii) for three years after the Executive's Date of
         Termination, or such longer period as any plan, program or arrangement
         may provide, the Company shall continue benefits to the Executive
         and/or the Executive's family at least equal to those that would have
         been provided to them in accordance with the plans, programs and
         arrangements described in Paragraph 4(c)(ii) if the Executive's
         employment had not been terminated, in accordance with the most
         favorable plans, programs and arrangements of the Company and its
         affiliated companies as in effect and applicable generally to the
         Executive's peer executives of the Company and its affiliated companies
         and their families during the 120-day period immediately preceding the
         Effective Date or, if more favorable to the Executive, as in effect
         generally at any time thereafter with respect to the Executive's peer
         executives of the Company and its affiliated companies and their
         families; provided, however, that if the Executive becomes reemployed
         with another employer and is eligible to receive medical or other
         welfare benefits under another employer provided plan, the medical and
         other welfare benefits described herein shall be secondary to those
         provided under such other plan during such applicable period of
         eligibility (such continuation of such benefits for the applicable
         period herein set forth is hereinafter referred to as "Welfare Benefit
         Continuation") (for purpose of determining eligibility of the Executive
         for retiree benefits pursuant to such plans, programs and arrangements,
         the Executive
 
 
                                       9
<PAGE>
 
         shall be considered to have remained employed until three years after
         the Date of Termination and to have retired on the last day of such
         period); and
 
                  (iii) the Company shall, at its sole expense as incurred,
         provide the Executive with outplacement services the scope and provider
         of which shall be selected by the Executive in the Executive's sole
         discretion; and
 
                  (iv) with respect to all options to purchase Ordinary Shares,
         par value US$.10 per share, of Noble-Cayman ("Ordinary Shares") held by
         the Executive pursuant to a Noble-Cayman option plan on or prior to the
         Date of Termination, irrespective of whether such options are then
         exercisable, the Executive shall have the right, during the 60-day
         period after the Date of Termination, to elect to surrender all or part
         of such options in exchange for a cash payment by the Company to the
         Executive in an amount equal to the number of Ordinary Shares subject
         to the Executive's option multiplied by the excess of (x) over (y),
         where (x) equals the highest reported sale price of an Ordinary Share
         in any transaction reported on the New York Stock Exchange during the
         60-day period prior to and including the Executive's Date of
         Termination and (y) equals the purchase price per share covered by the
         option. Such cash payments shall be made within 30 days after the date
         of the Executive's election; provided, however, that if the Executive's
         Date of Termination is within six months after the date of grant of a
         particular option held by the Executive and the Executive is subject to
         Section 16(b) of the U.S. Securities Exchange Act of 1934, as amended
         (the "Exchange Act"), any cash payments related thereto shall be made
         on the date which is six months and one day after the date of grant of
         such option to the extent necessary to prevent the imposition of the
         disgorgement provisions under Section 16(b).
 
                  (v) all club memberships and other memberships that the
         Company was providing for the Executive's use at the time Notice of
         Termination is given shall, to the extent possible, be transferred and
         assigned to the Executive at no cost to the Executive (other than
         income taxes owed), the cost of transfer, if any, to be borne by the
         Company; and
 
                  (vi) all benefits under the Noble Corporation 1991 Stock
         Option and Restricted Stock Plan and any other similar plans, including
         any stock options or restricted stock held by the Executive, not
         already vested shall be 100% vested, to the extent such vesting is
         permitted under the U.S. Internal Revenue Code (the "Code"); and
 
                  (vii) to the extent not theretofore paid or provided, the
         Company shall timely pay or provide to the Executive any other amounts
         or benefits required to be paid or provided or which the Executive is
         eligible to receive under any plan, program, policy, practice or
         arrangement or contract or agreement of the Company and its affiliated
         companies (such other amounts and benefits hereinafter referred to as
         the "Other Benefits").
 
         (b) Death. If the Executive's employment is terminated by reason of the
Executive's death during the Employment Term, this Agreement shall terminate
without further obligations
 
 
                                       10
<PAGE>
 
to the Executive's legal representatives under this Agreement, other than for
(i) payment of Accrued Obligations (which shall be paid to the Executive's
estate or beneficiary, as applicable, in a lump sum in cash within 30 days of
the Date of Termination) and the timely payment or provision of the Welfare
Benefit Continuation and the Other Benefits and (ii) payment to the Executive's
estate or beneficiaries, as applicable, in a lump sum in cash within 30 days of
the Date of Termination of an amount equal to the sum of the Severance Amount
and the Supplemental Retirement Amount. With respect to the provision of Other
Benefits, the term "Other Benefits" as used in this Paragraph 6(b) shall
include, without limitation, and the Executive's estate and/or beneficiaries
shall be entitled to receive, benefits at least equal to the most favorable
benefits provided by the Company and its affiliated companies to the estates and
beneficiaries of the Executive's peer executives of the Company and such
affiliated companies under such plans, programs, practices and policies relating
to death benefits, if any, as in effect with respect to the peer executives and
their beneficiaries at any time during the 120-day period immediately preceding
the Effective Date or, if more favorable to the Executive's estate and/or the
Executive's beneficiaries, as in effect on the date of the Executive's death
with respect to other of the Executive's peer executives of the Company and its
affiliated companies and their beneficiaries.
 
         (c) Disability. If the Executive's employment is terminated by reason
of the Executive's Disability during the Employment Term, this Agreement shall
terminate without further obligations to the Executive, other than for (i)
payment of Accrued Obligations (which shall be paid to the Executive in a lump
sum in cash within 30 days of the Date of Termination) and the timely payment or
provision of the Welfare Benefit Continuation and the Other Benefits and (ii)
payment to the Executive in a lump sum in cash within 30 days of the Date of
Termination of an amount equal to the sum of the Severance Amount and the
Supplemental Retirement Amount. With respect to the provision of Other Benefits,
the term "Other Benefits" as used in this Paragraph 6(c) shall include, without
limitation, and the Executive shall be entitled after the Disability Effective
Date to receive, disability and other benefits at least equal to the most
favorable of those generally provided by the Company and its affiliated
companies to disabled executives and/or their families in accordance with such
plans, programs, practices and policies relating to disability, if any, as in
effect generally with respect to other of the Executive's peer executives of the
Company and their families at any time during the 120-day period immediately
preceding the Effective Date or, if more favorable to the Executive and/or the
Executive's family, as in effect at any time thereafter generally with respect
to other of the Executive's peer executives of the Company and its affiliated
companies and their families.
 
         (d) Cause; Other than for Good Reason or During the Window Period. If
the Executive's employment is terminated for Cause during the Employment Term,
this Agreement shall terminate without further obligations to the Executive
other than the obligation to pay to the Executive Base Salary through the Date
of Termination plus the amount of any compensation previously deferred by the
Executive, in each case to the extent theretofore unpaid. If the Executive
voluntarily terminates the Executive's employment during the Employment Term,
excluding a termination either for Good Reason or without any reason during the
Window Period, this Agreement shall terminate without further obligations to the
Executive, other than for Accrued Obligations and the timely payment or
provision of the Other Benefits. In such case,
 
 
                                       11
<PAGE>
 
all Accrued Obligations shall be paid to the Executive in a lump sum in cash
within 30 days of the Date of Termination subject to applicable laws and
regulations.
 
         7. Certain Additional Payments by the Company.
 
         (a) Notwithstanding any provision in this Agreement to the contrary and
except as set forth below, if it shall be determined that any payment or
distribution by the Company to or for the benefit of the Executive (whether paid
or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, but determined without regard to any additional payments
required pursuant to this Paragraph 7) (a "Payment") would be subject to the
excise tax imposed by Section 4999 of the Code or any interest or penalties are
incurred by the Executive with respect to such excise tax (such excise tax,
together with any such interest and penalties, are hereinafter collectively
referred to as the "Excise Tax"), then the Executive shall be entitled to
receive an additional payment (a "Gross-Up Payment") in an amount such that
after payment by the Executive of all taxes (including any interest or penalties
imposed with respect to such taxes), including any income taxes (and any
interest and penalties imposed with respect thereto) and Excise Tax imposed upon
the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment
equal to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing
provisions of this Paragraph 7(a), if it shall be determined that the Executive
is entitled to a Gross-Up Payment, but that the Executive, after taking into
account the Payments and the Gross-Up Payment, would not receive a net after-tax
benefit of at least $50,000 (taking into account both income taxes and any
Excise Tax) as compared to the net after-tax proceeds to the Executive resulting
from an elimination of the Gross-Up Payment and a reduction of the Payments, in
the aggregate, to an amount (the "Reduced Amount") such that the receipt of
payments would not give rise to any Excise Tax, then no Gross-Up Payment shall
be made to the Executive and the Payments, in the aggregate, shall be reduced to
the Reduced Amount.
 
         (b) Subject to the provisions of Paragraph 7(c), all determinations
required to be made under this Paragraph 7, including whether and when a
Gross-Up Payment is required and the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determination, shall be made by
PricewaterhouseCoopers LLP (the "Accounting Firm") or, as provided below, such
other certified public accounting firm as may be designated by the Executive,
which shall provide detailed supporting calculations both to the Company and the
Executive within 15 business days after the receipt of notice from the Executive
that there has been a Payment, or such earlier time as is requested by the
Company. If the Accounting Firm is serving as accountant or auditor for the
individual, entity or group effecting the Change of Control, the Executive shall
have the option, in the Executive's sole discretion, to appoint another
nationally recognized accounting firm to make the determinations required
hereunder (which accounting firm shall then be referred to as the "Accounting
Firm" hereunder). All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any Gross-Up Payment, as determined pursuant to this
Paragraph 7, shall be paid by the Company to the Executive within five days of
the receipt of the Accounting Firm's determination. If the Accounting Firm
determines that no Excise Tax is payable by the Executive, it shall furnish the
Executive with a written opinion that failure to report the Excise Tax on the
Executive's applicable federal income tax return would not result in the
imposition of a negligence or similar penalty. Any determination by the
Accounting Firm shall be binding upon the Company and the Executive. As
 
 
                                       12
<PAGE>
 
a result of the uncertainty in the application of Section 4999 of the Code at
the time of the initial determination by the Accounting Firm hereunder, it is
possible that Gross-Up Payments that will not have been made by the Company
should have been made ("Underpayment"), consistent with the calculations
required to be made hereunder. If the Company exhausts its remedies pursuant to
Paragraph 7(c) and the Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment
that has occurred and any such Underpayment shall be promptly paid by the
Company to or for the benefit of the Executive.
 
         (c) The Executive shall notify the Company in writing of any claim by
the Internal Revenue Service of the United States (the "Internal Revenue
Service") that, if successful, would require the payment by the Company of the
Gross-Up Payment (or an additional amount of Gross-Up Payment) in the event the
Internal Revenue Service seeks higher payment. Such notification shall be given
as soon as practicable but no later than 10 business days after the Executive is
informed in writing of such claim and shall apprise the Company of the nature of
such claim and the date on which such claim is requested to be paid. The
Executive shall not pay such claim prior to the expiration of the 30-day period
following the date on which it gives such notice to the Company (or such shorter
period ending on the date that any payment of taxes with respect to such claim
is due). If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive
shall:
 
                  (i) give the Company any information reasonably requested by
         the Company relating to such claim;
 
                  (ii) take such action in connection with contesting such claim
         as the Company shall reasonably request in writing from time to time,
         including the acceptance of legal representation with respect to such
         claim by an attorney reasonably selected by the Company;
 
                  (iii) cooperate with the Company in good faith in order
         effectively to contest such claim; and
 
                  (iv) permit the Company and/or Noble-Cayman to participate in
         any proceedings relating to such claim;
 
provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses. Without limitation of the foregoing provisions of
this Paragraph 7(c), the Company shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue or forgo any
and all administrative appeals, proceedings, hearings and conferences with the
taxing authority in respect of such claim and may, at its sole option, either
direct the Executive to pay the tax claimed and sue for a refund or contest the
claim in any permissible manner, and the Executive agrees to prosecute such
contest to a determination before any administrative tribunal, in a court of
initial jurisdiction, and in one
 
 
                                       13
<PAGE>
 
or more appellate courts, as the Company shall determine; provided, however,
that if the Company directs the Executive to pay such claim and sue for a
refund, the Company shall advance the amount of such payment to the Executive,
on an interest-free basis, and shall indemnify and hold the Executive harmless,
on an after-tax basis, from any Excise Tax or income tax (including interest or
penalties with respect thereto) imposed with respect to such advance or with
respect to any imputed income with respect to such advance; and provided
further, that any extension of the statute of limitations relating to payment of
taxes for the taxable year of the Executive with respect to which such contested
amount is claimed to be due is limited solely to such contested amount.
Furthermore, the Company's control of the contest shall be limited to issues
with respect to which a Gross-Up Payment would be payable hereunder and the
Executive shall be entitled to settle or contest, as the case may be, any other
issue raised by the Internal Revenue Service or any other taxing authority.
 
         (d) If, after the receipt by the Executive of an amount advanced by the
Company pursuant to Paragraph 7(c), the Executive becomes entitled to receive
any refund with respect to such claim, the Executive shall (subject to the
Company's complying with the requirements of Paragraph 7(c)) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by the Executive
of an amount advanced by the Company pursuant to Paragraph 7(c), a determination
is made that the Executive shall not be entitled to any refund with respect to
such claim and the Company does not notify the Executive in writing of its
intent to contest such denial of refund prior to the expiration of 30 days after
such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.
 
         8. Representations and Warranties.
 
         (a) The Company represents and warrants to the Executive that the
execution, delivery and performance by the Company of this Agreement have been
duly authorized by all necessary corporate action of the Company and do not and
will not conflict with or result in a violation of any provision of, or
constitute a default under, any contract, agreement, instrument or obligation to
which the Company is a party or by which it is bound.
 
         (b) The Executive represents and warrants to the Company that the
execution, delivery and performance by the Executive of this Agreement do not
and will not conflict with or result in a violation of any provision of, or
constitute a default under, any contract, agreement, instrument or obligation to
which the Executive is a party or by which the Executive is bound.
 
         9. Confidential Information. The Executive recognizes and acknowledges
that the Company's and its affiliated companies' trade secrets and other
confidential or proprietary information, as they may exist from time to time,
are valuable, special and unique assets of the Company's and/or such affiliated
companies' business, access to and knowledge of which are essential to the
performance of the Executive's duties hereunder. The Executive confirms that all
such trade secrets and other information constitute the exclusive property of
the Company and/or such affiliated companies. During the Employment Term and
thereafter without limitation of time, the Executive shall hold in strict
confidence and shall not, directly or indirectly, disclose or
 
 
                                       14
<PAGE>
 
reveal to any person, or use for the Executive's own personal benefit or for the
benefit of anyone else, any trade secrets, confidential dealings or other
confidential or proprietary information of any kind, nature or description
(whether or not acquired, learned, obtained or developed by the Executive alone
or in conjunction with others) belonging to or concerning the Company or any of
its affiliated companies, except (i) with the prior written consent of the
Company duly authorized by its Board, (ii) in the course of the proper
performance of the Executive's duties hereunder, (iii) for information (x) that
becomes generally available to the public other than as a result of unauthorized
disclosure by the Executive or the Executive's affiliates or (y) that becomes
available to the Executive on a nonconfidential basis from a source other than
the Company or its affiliated companies who is not bound by a duty of
confidentiality, or other contractual, legal or fiduciary obligation, to the
Company, or (iv) as required by applicable law or legal process. The provisions
of this Paragraph 9 shall continue in effect notwithstanding termination of the
Executive's employment hereunder for any reason.
 
         10. Certain Definitions.
 
         (a) Effective Date. The "Effective Date" shall mean the first date
during the Change of Control Period (as defined in Paragraph 10(b)) on which a
Change of Control occurs. Notwithstanding anything in this Agreement to the
contrary, if a Change of Control occurs and if the Executive's employment with
the Company (or applicable affiliated company) is terminated prior to the date
on which the Change of Control occurs, and if it is reasonably demonstrated by
the Executive that such termination of employment (i) was at the request of a
third party who has taken steps reasonably calculated to effect a Change of
Control or (ii) otherwise arose in connection with or anticipation of a Change
of Control, then for all purposes of this Agreement the "Effective Date" shall
mean the date immediately prior to the date of such termination of employment.
 
         (b) Change of Control Period. The "Change of Control Period" shall mean
the period commencing on the date of this Agreement and ending on the third
anniversary of such date; provided, however, that commencing on the date one
year after the date hereof, and on each annual anniversary of such date (such
date and each annual anniversary thereof herein referred to as the "Renewal
Date"), the Change of Control Period shall be automatically extended so as to
terminate three years after such Renewal Date, unless at least 60 days prior to
the Renewal Date the Company shall give notice to the Executive that the Change
of Control Period shall not be so extended.
 
         (c) Change of Control. For purposes of this Agreement, a "Change of
Control" shall mean:
 
                  (i) the acquisition by any individual, entity or group (within
         the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act) (a
         "Person") of beneficial ownership (within the meaning of Rule 13d-3
         promulgated under the Exchange Act) of 15% or more of either (A) the
         then outstanding Ordinary Shares of Noble-Cayman (the "Outstanding
         Parent Shares") or (B) the combined voting power of the then
         outstanding voting securities of Noble-Cayman entitled to vote
         generally in the election of directors (the "Outstanding Parent Voting
         Securities"); provided, however, that for purposes of this
 
 
                                       15
<PAGE>
 
         subparagraph (c)(i) the following acquisitions shall not constitute a
         Change of Control: (w) any acquisition directly from Noble-Cayman
         (excluding an acquisition by virtue of the exercise of a conversion
         privilege), (x) any acquisition by Noble-Cayman, (y) any acquisition by
         any employee benefit plan (or related trust) sponsored or maintained by
         Noble-Cayman or any company controlled by Noble-Cayman, or (z) any
         acquisition by any corporation pursuant to a reorganization, merger,
         amalgamation or consolidation, if, following such reorganization,
         merger, amalgamation or consolidation, the conditions described in
         clauses (A), (B) and (C) of subparagraph (iii) of this Paragraph 10(c)
         are satisfied; or
 
                  (ii) individuals who, immediately after the Effective Time of
         the Merger, constitute the Noble-Cayman Board (the "Incumbent Board")
         cease for any reason to constitute a majority of such Board of
         Directors; provided, however, that any individual becoming a director
         of Noble-Cayman subsequent to the Effective Time of the Merger whose
         election, or nomination for election by Noble-Cayman's Members, was
         approved by a vote of a majority of the directors of Noble-Cayman then
         comprising the Incumbent Board shall 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
         or other actual or threatened solicitation of proxies or consents by or
         on behalf of a Person other than the Noble-Cayman Board; or
 
                  (iii) consummation of a reorganization, merger, amalgamation
         or consolidation of Noble-Cayman, with or without approval by the
         Members of Noble-Cayman, in each case, unless, following such
         reorganization, merger, amalgamation or consolidation, (A) more than
         50% of, respectively, the then outstanding shares of common stock (or
         equivalent security) of the company resulting from such reorganization,
         merger, amalgamation or consolidation and the combined voting power of
         the then outstanding voting securities of such company 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 Parent Shares and Outstanding Parent Voting Securities
         immediately prior to such reorganization, merger, amalgamation or
         consolidation in substantially the same proportions as their ownership,
         immediately prior to such reorganization, merger, amalgamation or
         consolidation, of the Outstanding Parent Shares and Outstanding Parent
         Voting Securities, as the case may be, (B) no Person (excluding
         Noble-Cayman, any employee benefit plan (or related trust) of
         Noble-Cayman or such company resulting from such reorganization,
         merger, amalgamation or consolidation, and any Person beneficially
         owning, immediately prior to such reorganization, merger, amalgamation
         or consolidation, directly or indirectly, 15% or more of the
         Outstanding Parent Shares or Outstanding Parent Voting Securities, as
         the case may be) beneficially owns, directly or indirectly, 15% or more
         of, respectively, the then outstanding shares of common stock (or
         equivalent security) of the company resulting from such reorganization,
         merger, amalgamation or consolidation or the combined voting power of
         the then outstanding voting securities of such company entitled to vote
         generally in the election of directors, and (C) a majority of the
         members of the board of directors of the company resulting
 
 
                                       16
<PAGE>
 
         from such reorganization, merger, amalgamation or consolidation were
         members of the Incumbent Board at the time of the execution of the
         initial agreement providing for such reorganization, merger,
         amalgamation or consolidation; or
 
                  (iv) consummation of a sale or other disposition of all or
         substantially all the assets of Noble-Cayman, with or without approval
         by the Members of Noble-Cayman, other than to a corporation, with
         respect to which following such sale or other disposition, (A) more
         than 50% of, respectively, the then outstanding shares of common stock
         (or equivalent security) of such corporation and the combined voting
         power of the then outstanding voting securities of such corporation
         entitled to vote generally in the election of directors is then
         beneficially owned, directly or indirectly, by all or substantially all
         the individuals and entities who were the beneficial owners,
         respectively, of the Outstanding Parent Shares and Outstanding Parent
         Voting Securities immediately prior to such sale or other disposition
         in substantially the same proportion as their ownership, immediately
         prior to such sale or other disposition, of the Outstanding Parent
         Shares and Outstanding Parent Voting Securities, as the case may be,
         (B) no Person (excluding Noble-Cayman, any employee benefit plan (or
         related trust) of Noble-Cayman or such corporation, and any Person
         beneficially owning, immediately prior to such sale or other
         disposition, directly or indirectly, 15% or more of the Outstanding
         Parent Shares or Outstanding Parent Voting Securities, as the case may
         be) beneficially owns, directly or indirectly, 15% or more of,
         respectively, the then outstanding shares of common stock (or
         equivalent security) of such corporation or the combined voting power
         of the then outstanding voting securities of such corporation entitled
         to vote generally in the election of directors, and (C) 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 Noble-Cayman Board providing for such sale
         or other disposition of assets of Noble-Cayman; or
 
         (v) approval by the Members of Noble-Cayman of a complete liquidation
         or dissolution of Noble-Cayman.
 
         11. Full Settlement.
 
         (a) There shall be no right of set off or counterclaim against, or
delay in, any payments to the Executive, or to the Executive's heirs or legal
representatives, provided for in this Agreement, in respect of any claim against
or debt or other obligation of the Executive or others, whether arising
hereunder or otherwise.
 
         (b) In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement, and such amounts
shall not be reduced whether or not the Executive obtains other employment.
 
         (c) The Company agrees to pay as incurred, to the full extent permitted
by law, all costs and expenses (including attorneys' fees) that the Executive,
or the Executive's heirs or legal representatives, may reasonably incur as a
result of any contest (regardless of the outcome
 
 
                                       17
<PAGE>
 
thereof) by the Company, the Executive or others of the validity or
enforceability of, or liability under, any provision of this Agreement, or any
guarantee of performance thereof (including as a result of any contest by the
Executive, or the Executive's heirs or legal representatives, about the amount
of any payment pursuant to this Agreement), plus in each case interest on any
delayed payment at the applicable federal rate provided for in Section
7872(f)(2) of the Code.
 
         12. No Effect on Other Contractual Rights. The provisions of this
Agreement, and any payment provided for hereunder, shall not reduce any amounts
otherwise payable to the Executive, or in any way diminish the Executive's
rights as an employee of the Company or any of its affiliates, whether existing
on the date of this Agreement or hereafter, under any employee benefit plan,
program or arrangement or other contract or agreement of the Company or any of
its affiliated companies providing benefits to the Executive.
 
         13. Indemnification; Directors and Officers Insurance. The Company
shall (a) during the Employment Term and thereafter without limitation of time,
indemnify and advance expenses to the Executive to the fullest extent permitted
by the laws of the State of Delaware from time to time in effect and (b) ensure
that during the Employment Term, Noble-Cayman acquires and maintains directors
and officers liability insurance covering the Executive (and to the extent
Noble-Cayman desires, other directors and officers of Noble-Cayman and/or the
Company and its affiliated companies) to the extent it is available at
commercially reasonable rates as determined by the Noble-Cayman Board; provided,
however, that in no event shall the Executive be entitled to indemnification or
advancement of expenses under this Paragraph 13 with respect to any proceeding
or matter therein brought or made by the Executive against the Company or
Noble-Cayman other than one initiated by the Executive to enforce the
Executive's rights under this Paragraph 13. The rights of indemnification and to
receive advancement of expenses as provided in this Paragraph 13 shall not be
deemed exclusive of any other rights to which the Executive may at any time be
entitled under applicable law, the Certificate of Incorporation or Bylaws of the
Company, the Articles of Association of Noble-Cayman, any agreement, a vote of
shareholders or members, a resolution of the Board or the Noble-Cayman Board, or
otherwise. The provisions of this Paragraph 13 shall continue in effect
notwithstanding termination of the Executive's employment hereunder for any
reason.
 
         14. Injunctive Relief. In recognition of the fact that a breach by the
Executive of any of the provisions of Paragraph 9 will cause irreparable damage
to the Company and/or its affiliated companies for which monetary damages alone
will not constitute an adequate remedy, the Company shall be entitled as a
matter of right (without being required to prove damages or furnish any bond or
other security) to obtain a restraining order, an injunction, an order of
specific performance, or other equitable or extraordinary relief from any court
of competent jurisdiction restraining any further violation of such provisions
by the Executive or requiring the Executive to perform the Executive's
obligations hereunder. Such right to equitable or extraordinary relief shall not
be exclusive but shall be in addition to all other rights and remedies to which
the Company or any of its affiliated companies may be entitled at law or in
equity, including without limitation the right to recover monetary damages for
the breach by the Executive of any of the provisions of this Agreement.
 
 
                                       18
<PAGE>
 
         15. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Texas, without regard
to the principles of conflicts of laws thereof.
 
         16. Notices. All notices, requests, demands and other communications
required or permitted to be given or made hereunder by either party hereto shall
be in writing and shall be deemed to have been duly given or made (i) when
delivered personally, (ii) when sent by telefacsimile transmission, or (iii)
five days after being deposited in the United States mail, first class
registered or certified mail, postage prepaid, return receipt requested, to the
party for which intended at the following addresses (or at such other addresses
as shall be specified by the parties by like notice, except that notices of
change of address shall be effective only upon receipt):
 
         If to the Company, at:        Noble Drilling Corporation
                                       13135 South Dairy Ashford, Suite 800
                                       Sugar Land, Texas 77478
                                       Fax No.:  (218) 276-6316
                                       Attention: Chief Executive Officer
 
         If to the Executive, at:      James C. Day
                                       Noble Drilling Corporation
                                       13135 South Dairy Ashford, Suite 800
                                       Sugar Land, Texas 77478
                                       Fax No.:  (218) 276-6316
 
         17. Binding Effect; Assignment; No Third Party Benefit.
 
         (a) This Agreement is personal to the Executive and without the prior
written consent of the Company shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and shall be enforceable by the Executive's legal
representatives.
 
         (b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.
 
         (c) The Company shall require any successor or assign (whether direct
or indirect, by purchase, merger, consolidation, amalgamation or otherwise) to
all or substantially all the business and/or assets of Noble-Cayman, by
agreement in writing in form and substance reasonably satisfactory to the
Executive, expressly, absolutely and unconditionally to assume and agree to
perform this Agreement in the same manner and to the same extent that the
Company would be required to perform it if no such succession or assignment had
taken place. As used in this Agreement, the "Company" shall mean the Company as
hereinbefore defined and any successor or assign to the business and/or assets
of Noble-Cayman as aforesaid which executes and delivers the agreement provided
for in this Paragraph 17(c) or which otherwise becomes bound by all the terms
and provisions of this Agreement by operation of law.
 
 
                                       19
<PAGE>
 
         (d) Nothing in this Agreement, express or implied, is intended to or
shall confer upon any person other than the parties hereto and Noble-Cayman, and
their respective heirs, legal representatives, successors and permitted assigns,
any rights, benefits or remedies of any nature whatsoever under or by reason of
this Agreement.
 
         18. Miscellaneous.
 
         (a) Amendment. This Agreement may not be modified or amended in any
respect except by an instrument in writing signed by the party against whom such
modification or amendment is sought to be enforced. No person, other than
pursuant to a resolution of the Board or a committee thereof, which resolution
is approved by the Noble-Cayman Board or a committee thereof, shall have
authority on behalf of the Company to agree to modify, amend or waive any
provision of this Agreement or anything in reference thereto.
 
         (b) Waiver. Any term or condition of this Agreement may be waived at
any time by the party hereto which is entitled to have the benefit thereof, but
such waiver shall only be effective if evidenced by a writing signed by such
party, and a waiver on one occasion shall not be deemed to be a waiver of the
same or any other type of breach on a future occasion. No failure or delay by a
party hereto in exercising any right or power hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right or power.
 
         (c) Withholding Taxes. The Company may withhold from any amounts
payable under this Agreement such federal, state, local or foreign taxes as
shall be required to be withheld pursuant to any applicable law or regulation.
 
         (d) Nonalienation of Benefits. The Executive shall not have any right
to pledge, hypothecate, anticipate or in any way create a lien upon any payments
or other benefits provided under this Agreement; and no benefits payable
hereunder shall be assignable in anticipation of payment either by voluntary or
involuntary acts, or by operation of law, except by will or pursuant to the laws
of descent and distribution.
 
         (e) Severability. If any provision of this Agreement is held to be
invalid or unenforceable, (a) this Agreement shall be considered divisible, (b)
such provision shall be deemed inoperative to the extent it is deemed invalid or
unenforceable, and (c) in all other respects this Agreement shall remain in full
force and effect; provided, however, that if any such provision may be made
valid or enforceable by limitation thereof, then such provision shall be deemed
to be so limited and shall be valid and/or enforceable to the maximum extent
permitted by applicable law.
 
         (f) Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto concerning the subject matter hereof, and from and
after the date of this Agreement, this Agreement shall supersede any other prior
agreement or understanding, both written and oral, between the parties with
respect to such subject matter.
 
 
                                       20
<PAGE>
 
         (g) Captions. The captions herein are inserted for convenience of
reference only, do not constitute a part of this Agreement, and shall not affect
in any manner the meaning or interpretation of this Agreement.
 
         (h) References. All references in this Agreement to Paragraphs,
subparagraphs and other subdivisions refer to the Paragraphs, subparagraphs and
other subdivisions of this Agreement unless expressly provided otherwise. The
words "this Agreement", "herein", "hereof", "hereby", "hereunder" and words of
similar import refer to this Agreement as a whole and not to any particular
subdivision unless expressly so limited. Whenever the words "include",
"includes" and "including" are used in this Agreement, such words shall be
deemed to be followed by the words "without limitation". Words in the singular
form shall be construed to include the plural and vice versa, unless the context
otherwise requires.
 
         19. Agreement Subject to Merger. This Agreement shall not become a
binding agreement unless and until the Merger is consummated.
 
 
 
                                       21
<PAGE>
         IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed on its behalf by its duly authorized officer, and the Executive has
executed this Agreement, as of the date first above set forth.
 
                           "COMPANY"
                           NOBLE DRILLING CORPORATION
 
 
 
                           By:      /s/ James C. Day
                                    ---------------------------------------
                           Name:    James C. Day
                                    ---------------------------------------
                           Title:   Chairman and Chief Executive Officer
                                    ---------------------------------------
 
 
                           "EXECUTIVE"
 
 
                           /s/ James C. Day
                           ------------------------------------------------
                           James C. Day

                              EMPLOYMENT AGREEMENT
 
         This EMPLOYMENT AGREEMENT (this "Agreement"), dated as of October 22,
1998, by and between NOBLE DRILLING CORPORATION, a Delaware corporation (the
"Company"), and JAMES C. DAY (the "Executive");
 
                                   WITNESSETH:
 
         WHEREAS, the Board of Directors of the Company (the "Board") has
determined that it is in the best interests of the Company and its stockholders
to assure that the Company will have the continued dedication of the Executive,
notwithstanding the possibility, threat, or occurrence of a Change of Control
(as defined in Paragraph 10(c)) of the Company; and
 
         WHEREAS, the Board believes it is imperative to diminish the inevitable
distraction of the Executive by virtue of the personal uncertainties and risks
created by a pending or threatened Change of Control and to encourage the
Executive's full attention and dedication to the Company currently and in the
event of any pending or threatened Change of Control, and to provide the
Executive with compensation and benefits upon a Change of Control which ensure
that the compensation and benefits expectations of the Executive will be
satisfied and which are competitive with those of other corporations; and
 
         WHEREAS, in order to accomplish these objectives, the Board has caused
the Company to enter into this Agreement;
 
         NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the Company and the Executive hereby agree as follows:
 
         1. Employment. The Company agrees that the Company or an affiliated
company (as hereafter defined) will continue the Executive in its employ, and
the Executive agrees to remain in the employ of the Company or an affiliated
company, for the period set forth in Paragraph 2(a), in the positions and with
the duties and responsibilities set forth in Paragraph 3, and upon the other
terms and conditions herein provided. As used in this Agreement, the term
"affiliated company" shall include any company controlled by, controlling, or
under common control with the Company.
 
         2. Employment Term.
 
         (a) Term. The employment of the Executive by the Company as provided in
Paragraph 1 shall be for the period commencing on the Effective Date (as defined
in Paragraph 10 (a)) through and ending on the third anniversary of such date
(the "Employment Term").
 
         (b) Relationship Prior to Effective Date. The Executive and the Company
acknowledge that, except as may otherwise be provided under any written
agreement between the Executive and the Company other than this Agreement, the
employment of the Executive by the
 
                                        1
 
<PAGE>   5
 
 
 
Company is "at will" and, prior to the Effective Date, may be terminated by
either the Executive or the Company at any time. Moreover, if prior to the
Effective Date, the Executive's employment with the Company terminates, then the
Executive shall have no further rights under this Agreement. For purposes of
this Paragraph 2(b) only, the term Company shall mean and include the company
that employs Executive, whether Noble Drilling Corporation or an affiliated
company of Noble Drilling Corporation.
 
         3. Positions and Duties.
 
         (a) During the Employment Term, the Executive's position (including
status, offices, titles, and reporting requirements), duties, functions,
responsibilities, and authority shall be at least commensurate in all material
respects with the most significant of those held or exercised by or assigned to
the Executive in respect of the Company and its affiliated companies at any time
during the 120-day period immediately preceding the Effective Date.
 
         (b) During the Employment Term, the Executive shall devote the
Executive's full time, skill, and attention and the Executive's reasonable best
efforts during normal business hours to the business and affairs of the Company,
and in furtherance of the business and affairs of its affiliated companies, to
the extent necessary to discharge faithfully and efficiently the duties and
responsibilities delegated and assigned to the Executive herein or pursuant
hereto, except for usual, ordinary, and customary periods of vacation and
absence due to illness or other disability; provided, however, that the
Executive may (i) serve on industry-related, civic or charitable boards or
committees, (ii) with the approval of the Board, serve on corporate boards or
committees, (iii) deliver lectures, fulfill speaking engagements, or teach at
educational institutions, and (iv) manage the Executive's personal investments,
so long as such activities do not significantly interfere with the performance
and fulfillment of the Executive's duties and responsibilities as an employee of
the Company or an affiliated company in accordance with this Agreement and, in
the case of the activities described in clause (ii) of this proviso, will not,
in the good faith judgment of the Board, constitute an actual or potential
conflict of interest with the business of the Company or an affiliated company.
It is expressly understood and agreed that, to the extent that any such
activities have been conducted by the Executive during the term of the
Executive's employment by the Company or its affiliated companies prior to the
Effective Date consistent with the provisions of this Paragraph 3(b), the
continued conduct of such activities (or of activities similar in nature and
scope thereto) subsequent to the Effective Date shall not thereafter be deemed
to interfere with the performance and fulfillment of the Executive's duties and
responsibilities to the Company.
 
         (c) In connection with the Executive's employment hereunder, the
Executive shall be based at the location where the Executive was regularly
employed immediately prior to the Effective Date or any office which is the
headquarters of the Company and is less than 50 miles from such location,
subject, however, to required travel on the business of the Company to an extent
substantially consistent with the Executive's business travel obligations during
the three-year period immediately preceding the Effective Date.
 
 
                                        2
 
<PAGE>   6
 
 
 
         (d) All services that the Executive may render to the Company or any of
its affiliated companies in any capacity during the Employment Term shall be
deemed to be services required by this Agreement and consideration for the
compensation provided for herein.
 
         4. Compensation and Related Matters.
 
         (a) Base Salary. During the Employment Term, the Executive shall
receive an annual base salary ("Base Salary") at least equal to 12 times the
highest monthly base salary paid or payable, including any base salary that has
been earned but deferred, to the Executive by the Company and its affiliated
companies in respect of the 12-month period immediately preceding the month in
which the Effective Date occurs. The Base Salary shall be payable in
installments in accordance with the general payroll practices of the Company in
effect at the time such payment is made, but in no event less frequently than
monthly, or as otherwise mutually agreed upon. During the Employment Term, the
Executive's Base Salary shall be subject to such increases (but not decreases)
as may be determined from time to time by the Board in its sole discretion;
provided, however, that the Executive's Base Salary (i) shall be reviewed by the
Board no later than 12 months after the last salary increase awarded to the
Executive prior to the Effective Date and thereafter at least annually, with a
view to making such upward adjustment, if any, as the Board deems appropriate,
and (ii) shall be increased at any time and from time to time as shall be
substantially consistent with increases in base salary generally awarded in the
ordinary course of business to the Executive's peer executives of the Company or
any of its affiliated companies. Base Salary shall not be reduced after any such
increase. The term Base Salary as used in this Agreement shall refer to the Base
Salary as so increased. Payments of Base Salary to the Executive shall not be
deemed exclusive and shall not prevent the Executive from participating in any
employee benefit plans, programs, or arrangements of the Company and its
affiliated companies in which the Executive is entitled to participate. Payments
of Base Salary to the Executive shall not in any way limit or reduce any other
obligation of the Company hereunder, and no other compensation, benefit, or
payment to the Executive hereunder shall in any way limit or reduce the
obligation of the Company regarding the Executive's Base Salary hereunder.
 
         (b) Annual Bonus. In addition to Base Salary, the Executive shall be
awarded, in respect of each fiscal year of the Company ending during the
Employment Term, an annual bonus (the "Annual Bonus") in cash in an amount at
least equal to the Executive's highest aggregate bonus under all Company bonus
plans, programs, arrangements, and awards (including the Company's Short-Term
Incentive Plan and any successor plan), in respect of any fiscal year in the
three full fiscal year period ended immediately prior to the Effective Date
(annualized for any fiscal year consisting of less than 12 full months or with
respect to which the Executive has been employed by the Company for less than 12
full months) (such highest amount is hereinafter referred to as the "Recent
Annual Bonus"). Each such Annual Bonus shall be paid no later than the end of
the third month of the fiscal year next following the fiscal year in respect of
which the Annual Bonus is awarded, unless the Executive shall elect to defer the
receipt of such Annual Bonus.
 
 
                                        3
 
<PAGE>   7
 
 
 
         (c) Employee Benefits.
 
                      (i) Incentive, Savings, and Retirement Plans. During the
         Employment Term, the Executive shall be entitled to participate in all
         incentive, savings, and retirement plans, programs, and arrangements
         applicable generally to the Executive's peer executives of the Company
         and its affiliated companies, but in no event shall such plans,
         programs, and arrangements provide the Executive with incentive
         opportunities (measured with respect to both regular and special
         incentive opportunities, to the extent, if any, that such distinction
         is applicable), savings opportunities, and retirement benefit
         opportunities, in each case, less favorable, in the aggregate, than the
         most favorable of those provided by the Company and its affiliated
         companies for the Executive under such plans, programs, and
         arrangements as in effect at any time during the 120-day period
         immediately preceding the Effective Date or, if more favorable to the
         Executive, those provided generally at any time after the Effective
         Date to the Executive's peer executives of the Company and its
         affiliated companies.
 
                      (ii) Welfare Benefit Plans. During the Employment Term,
         the Executive and/or the Executive's family, as the case may be, shall
         be eligible to participate in and shall receive all benefits under all
         welfare benefit plans, programs, and arrangements provided by the
         Company and its affiliated companies (including, without limitation,
         medical, prescription, dental, disability, salary continuance, employee
         life, group life, accidental death, and travel accident insurance
         plans, programs, and arrangements) to the extent applicable generally
         to the Executive's peer executives of the Company and its affiliated
         companies, but in no event shall such plans, programs, and arrangements
         provide the Executive with welfare benefits that are less favorable, in
         the aggregate, than the most favorable of such plans, programs, and
         arrangements as in effect for the Executive at any time during the
         120-day period immediately preceding the Effective Date or, if more
         favorable to the Executive, those provided generally at any time after
         the Effective Date to the Executive's peer executives of the Company
         and its affiliated companies.
 
         (d) Expenses. During the Employment Term, the Executive shall be
entitled to receive prompt reimbursement for all reasonable expenses incurred by
the Executive in performing the Executive's duties and responsibilities
hereunder, in accordance with the most favorable policies, practices, and
procedures of the Company and its affiliated companies as in effect for the
Executive at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive, as in effect generally at
any time thereafter with respect to the Executive's peer executives of the
Company and its affiliated companies.
 
         (e) Fringe Benefits. During the Employment Term, the Executive shall be
entitled to fringe benefits, including, without limitation, tax and financial
planning services, payment of club dues, and, if applicable, use of an
automobile and payment of related expenses, in accordance with the most
favorable policies, practices, and procedures of the Company and its affiliated
companies as in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the Executive,
as in effect generally at any
 
                                        4
 
<PAGE>   8
 
 
 
time after the Effective Date with respect to the Executive's peer executives of
the Company and its affiliated companies.
 
         (f) Vacation. During the Employment Term, the Executive shall be
entitled to paid vacation and such other paid absences, whether for holidays,
illness, personal time, or any similar purposes, in accordance with the most
favorable policies, practices, and procedures of the Company and its affiliated
companies as in effect for the Executive at any time during the 120-day period
immediately preceding the Effective Date or, if more favorable to the Executive,
as in effect generally at any time after the Effective Date with respect to the
Executive's peer executives of the Company and its affiliated companies.
 
         5. Termination of Employment.
 
         (a) Death. The Executive's employment shall terminate automatically
upon the Executive's death during the Employment Term.
 
         (b) Disability. If the Company determines in good faith that the
Disability (as defined below) of the Executive has occurred during the
Employment Term, the Company may give the Executive notice of its intention to
terminate the Executive's employment. In such event, the Executive's employment
hereunder shall terminate effective on the 30th day after receipt of such notice
by the Executive (the "Disability Effective Date"), provided that, within the
30-day period after such receipt, the Executive shall not have returned to
full-time performance of the Executive's duties. For purposes of this Agreement,
"Disability" shall mean the absence of the Executive from the Executive's duties
hereunder on a full-time basis for an aggregate of 180 days within any given
period of 270 consecutive days (in addition to any statutorily required leave of
absence and any leave of absence approved by the Company), as a result of
incapacity of the Executive, despite any reasonable accommodation required by
law, due to bodily injury or disease or any other mental or physical illness,
which will, in the opinion of a physician selected by the Company or its
insurers and acceptable to the Executive or the Executive's legal
representative, be permanent and continuous during the remainder of the
Executive's life.
 
         (c) Termination by Company. The Company may terminate the Executive's
employment hereunder for Cause (as defined below). For purposes of this
Agreement, "Cause" shall mean:
 
                      (i) the willful and continued failure of the Executive to
         perform substantially the Executive's duties hereunder (other than any
         such failure resulting from bodily injury or disease or any other
         incapacity due to mental or physical illness), after a written demand
         for substantial performance is delivered to the Executive by the Board
         or the Chief Executive Officer of the Company which specifically
         identifies the manner in which the Board or Chief Executive Officer
         believes the Executive has not substantially performed the Executive's
         duties; or
 
 
                                        5
 
<PAGE>   9
 
 
 
                      (ii) the willful engaging by the Executive in illegal
         conduct or gross misconduct that is materially and demonstrably
         detrimental to the Company, monetarily or otherwise.
 
For purposes of this provision, no act, or failure to act, on the part of the
Executive shall be considered "willful" unless done, or omitted to be done, by
the Executive in bad faith or without reasonable belief that the Executive's
action or omission was in the best interests of the Company. Any act, or failure
to act, based upon authority given pursuant to a resolution duly adopted by the
Board or upon the instructions of the Chief Executive Officer or another senior
officer of the Company or based upon the advice of counsel for the Company shall
be conclusively presumed to be done, or omitted to be done, by the Executive in
good faith and in the best interests of the Company. The cessation of employment
of the Executive shall not be deemed to be for Cause unless and until there
shall have been delivered to the Executive a copy of a resolution duly adopted
by the affirmative vote of not less than two-thirds of the entire membership of
the Board then in office at a meeting of the Board called and held for such
purpose (after reasonable notice is provided to the Executive and the Executive
is given an opportunity, together with counsel, to be heard before the Board)
finding that, in the good faith opinion of the Board, the Executive is guilty of
the conduct described in subparagraph (i) or (ii) above, and specifying the
particulars thereof in detail.
 
         (d) Termination by Executive. The Executive may terminate the
Executive's employment hereunder (i) at any time during the Employment Term for
Good Reason (as defined below) or (ii) during the Window Period (as defined
below) without any reason.
 
For purposes of this Agreement, the "Window Period" shall mean the 30-day period
immediately following the first anniversary of the Effective Date, and "Good
Reason" shall mean any of the following (without the Executive's express written
consent):
 
                      (i) the assignment to the Executive of any duties
         inconsistent in any respect with the Executive's position (including
         status, offices, titles, and reporting requirements), duties,
         functions, responsibilities, or authority as contemplated by Paragraph
         3(a) of this Agreement, or any other action by the Company that results
         in a diminution in such position, duties, functions, responsibilities,
         or authority, excluding for this purpose an isolated, insubstantial,
         and inadvertent action not taken in bad faith and which is remedied by
         the Company promptly after receipt of notice thereof given by the
         Executive;
 
                      (ii) any failure by the Company to comply with any of the
         provisions of Paragraph 4 of this Agreement, other than an isolated,
         insubstantial, and inadvertent action not taken in bad faith and which
         is remedied by the Company promptly after receipt of notice thereof
         given by the Executive;
 
                      (iii) the Company's requiring the Executive to be based at
         any office or location other than as provided in Paragraph 3(c) of this
         Agreement or the Company's
 
                                        6
 
<PAGE>   10
 
 
 
         requiring the Executive to travel on Company business to a
         substantially greater extent than during the three-year period
         immediately preceding the Effective Date;
 
                      (iv) any failure by the Company to comply with and satisfy
         Paragraph 17(c) of this Agreement; or
 
                      (v) any purported termination by the Company of the
         Executive's employment hereunder otherwise than as expressly permitted
         by this Agreement, and for purposes of this Agreement, no such
         purported termination shall be effective.
 
For purposes of this Paragraph 5(d), any good faith determination of "Good
Reason" made by the Executive shall be conclusive.
 
         (e) Notice of Termination. Any termination of the Executive's
employment hereunder by the Company or by the Executive (other than a
termination pursuant to Paragraph 5(a)) shall be communicated by a Notice of
Termination (as defined below) to the other party hereto. For purposes of this
Agreement, a "Notice of Termination" shall mean a notice which (i) indicates the
specific termination provision in this Agreement relied upon, (ii) in the case
of a termination for Disability, Cause, or Good Reason, sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of
the Executive's employment under the provision so indicated, and (iii) specifies
the Date of Termination (as defined in Paragraph 5(f) below); provided, however,
that, notwithstanding any provision in this Agreement to the contrary, a Notice
of Termination given in connection with a termination for Good Reason shall be
given by the Executive within a reasonable period of time, not to exceed 120
days, following the occurrence of the event giving rise to such right of
termination. The failure by the Company or the Executive to set forth in the
Notice of Termination any fact or circumstance which contributes to a showing of
Disability, Cause, or Good Reason shall not waive any right of the Company or
the Executive hereunder or preclude the Company or the Executive from asserting
such fact or circumstance in enforcing the Company's or the Executive's rights
hereunder.
 
         (f) Date of Termination. For purposes of this Agreement, the "Date of
Termination" shall mean the effective date of termination of the Executive's
employment hereunder, which date shall be (i) if the Executive's employment is
terminated by the Executive's death, the date of the Executive's death, (ii) if
the Executive's employment is terminated because of the Executive's Disability,
the Disability Effective Date, (iii) if the Executive's employment is terminated
by the Company for Cause or by the Executive for Good Reason, the date on which
the Notice of Termination is given, (iv) if the Executive's employment is
terminated pursuant to Paragraph 2(a), the date on which the Employment Term
ends pursuant to Paragraph 2(a) due to a party's delivery of a Notice of
Termination thereunder, and (v) if the Executive's employment is terminated for
any other reason, the date specified in the Notice of Termination, which date
shall in no event be earlier than the date such notice is given; provided,
however, that if within 30 days after any Notice of Termination is given, the
party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the termination, the Date of Termination shall be the
date on which the dispute is finally determined, either by mutual written
agreement
 
                                        7
 
<PAGE>   11
 
 
 
of the parties or by a final judgment, order, or decree of a court of competent
jurisdiction (the time for appeal therefrom having expired and no appeal having
been perfected).
 
         6. Obligations of the Company Upon Termination.
 
         (a) Good Reason or During the Window Period; Other Than for Cause,
Death, or Disability. If, during the Employment Term, the Company shall
terminate the Executive's employment hereunder other than for Cause or
Disability or the Executive shall terminate the Executive's employment either
for Good Reason or without any reason during the Window Period:
 
                      (i) the Company shall pay to the Executive in a lump sum
         in cash within 30 days after the Date of Termination the aggregate of
         the following amounts:
 
                                  (A) the sum of (1) the Executive's Base Salary
                      through the Date of Termination to the extent not
                      theretofore paid, (2) the product of (x) the greater of
                      (I) the Recent Annual Bonus and (II) the Annual Bonus paid
                      or payable, including by reason of any deferral, to the
                      Executive (and annualized for any fiscal year consisting
                      of less than 12 full months or for which the Executive has
                      been employed by the Company for less than 12 full months)
                      in respect of the most recently completed fiscal year of
                      the Company during the Employment Term, if any (such
                      greater amount hereinafter referred to as the "Highest
                      Annual Bonus"), and (y) a fraction, the numerator of which
                      is the number of days in the current fiscal year through
                      the Date of Termination, and the denominator of which is
                      365, and (3) any compensation previously deferred by the
                      Executive (together with any accrued interest or earnings
                      thereon) and any accrued vacation pay, in each case to the
                      extent not theretofore paid (the sum of the amounts
                      described in clauses (1), (2), and (3) are hereinafter
                      referred to as the "Accrued Obligations"); and
 
                                  (B) an amount (such amount is hereinafter
                      referred to as the "Severance Amount") equal to the
                      product of (1) three and (2) the sum of (x) the
                      Executive's Base Salary and (y) the Highest Annual Bonus;
                      and
 
                                  (C) a separate lump-sum supplemental
                      retirement benefit (the amount of such benefit hereinafter
                      referred to as the "Supplemental Retirement Amount") equal
                      to the difference between (1) the actuarial equivalent
                      (utilizing for this purpose the actuarial assumptions
                      utilized with respect to the qualified defined benefit
                      retirement plan of the Company and its affiliated
                      companies in which the Executive is eligible to
                      participate (or any successor plan thereto) (the
                      "Retirement Plan") during the 120-day period immediately
                      preceding the Effective Date) of the benefit payable under
                      the Retirement Plan and any supplemental and/or excess
                      retirement plan of the Company and its affiliated
                      companies providing benefits for the Executive (the
                      "SERP") which the Executive would receive if the
                      Executive's employment continued at the compensation level
                      provided for in Paragraphs 4(a) and 4(b)(i) for the
                      remainder
 
                                        8
 
<PAGE>   12
 
 
 
                      of the Employment Term, assuming for this purpose that all
                      accrued benefits are fully vested and that benefit accrual
                      formulas are no less advantageous to the Executive than
                      those in effect during the 120-day period immediately
                      preceding the Effective Date, and (2) the actuarial
                      equivalent (utilizing for this purpose the actuarial
                      assumptions utilized with respect to the Retirement Plan
                      during the 120-day period immediately preceding the
                      Effective Date) of the Executive's actual benefit (paid or
                      payable), if any, under the Retirement Plan and the SERP;
                      and
 
                      (ii) for three years after the Executives's Date of
         Termination, or such longer period as any plan, program, or arrangement
         may provide, the Company shall continue benefits to the Executive
         and/or the Executive's family at least equal to those that would have
         been provided to them in accordance with the plans, programs, and
         arrangements described in Paragraph 4(c)(ii) if the Executive's
         employment had not been terminated, in accordance with the most
         favorable plans, programs, and arrangements of the Company as in effect
         and applicable generally to the Executive's peer executives of the
         Company and its affiliated companies and their families during the
         120-day period immediately preceding the Effective Date or, if more
         favorable to the Executive, as in effect generally at any time
         thereafter with respect to the Executive's peer executives of the
         Company and its affiliated companies and their families; provided,
         however, that if the Executive becomes reemployed with another employer
         and is eligible to receive medical or other welfare benefits under
         another employer provided plan, the medical and other welfare benefits
         described herein shall be secondary to those provided under such other
         plan during such applicable period of eligibility (such continuation of
         such benefits for the applicable period herein set forth is hereinafter
         referred to as "Welfare Benefit Continuation") (for purpose of
         determining eligibility of the Executive for retiree benefits pursuant
         to such plans, programs, and arrangements, the Executive shall be
         considered to have remained employed until three years after the Date
         of Termination and to have retired on the last day of such period); and
 
                      (iii) the Company shall, at its sole expense as incurred,
         provide the Executive with outplacement services the scope and provider
         of which shall be selected by the Executive in the Executive's sole
         discretion; and
 
                      (iv) with respect to all options to purchase Common Stock
         held by the Executive pursuant to a Company stock option plan on or
         prior to the Date of Termination, irrespective of whether such options
         are then exercisable, the Executive shall have the right, during the
         60-day period after the Date of Termination, to elect to surrender all
         or part of such options in exchange for a cash payment by the Company
         to the Executive in an amount equal to the number of shares of Common
         Stock subject to the Executive's option multiplied by the excess of (x)
         over (y), where (x) equals the highest reported sale price of a share
         of Common Stock in any transaction reported on the New York Stock
         Exchange during the 60-day period prior to and including the
         Executive's Date of Termination and (y) equals the purchase price per
         share covered by the option. Such cash payments shall be made within 30
         days after the date of the Executive's election; provided,
 
                                        9
 
<PAGE>   13
 
 
 
         however, that if the Executive's Date of Termination is within six
         months after the date of grant of a particular option held by the
         Executive and the Executive is subject to Section 16(b) of the
         Securities Exchange Act of 1934, as amended (the "Exchange Act"), any
         cash payments related thereto shall be made on the date which is six
         months and one day after the date of grant of such option to the extent
         necessary to prevent the imposition of the disgorgement provisions
         under Section 16(b). Notwithstanding the foregoing, if any right
         granted pursuant to the foregoing would make any change of control
         transaction ineligible for pooling of interests accounting treatment
         under APB No. 16 that but for this Section 6(a)(iv) would otherwise be
         eligible for such accounting treatment, the Executive shall receive
         shares of Common Stock with a fair market value equal to the cash that
         would otherwise be payable hereunder in substitution for the cash,
         provided that any such shares of Common Stock so delivered to the
         Executive shall be registered under the Securities Act of 1933, as
         amended; any options outstanding as of the Date of Termination and not
         then exercisable shall become fully exercisable as of the Executive's
         Date of Termination, and to the extent the Executive does not elect to
         surrender same for a cash payment (or the equivalent number of shares
         of Common Stock) as provided above, such options shall remain
         exercisable after the Executive's Date of Termination in accordance
         with the terms thereof; and restrictions applicable to any shares of
         Common Stock awarded to the Executive by the Company shall lapse, as of
         the date of the Executive's Date of Termination; and
 
                      (v) all club memberships and other memberships that the
         Company was providing for the Executive's use at the time Notice of
         Termination is given shall, to the extent possible, be transferred and
         assigned to the Executive at no cost to the Executive (other than
         income taxes owed), the cost of transfer, if any, to be borne by the
         Company; and
 
                      (vi) all benefits under the Noble Drilling Corporation
         1991 Stock Option and Restricted Stock Plan and any other similar
         plans, including any stock options or restricted stock held by the
         Executive, not already vested shall be 100% vested, to the extent such
         vesting is permitted under the Code; and
 
                      (vii) to the extent not theretofore paid or provided, the
         Company shall timely pay or provide to the Executive any other amounts
         or benefits required to be paid or provided or which the Executive is
         eligible to receive under any plan, program, policy, practice, or
         arrangement or contract or agreement of the Company and its affiliated
         companies (such other amounts and benefits hereinafter referred to as
         the "Other Benefits").
 
         (b) Death. If the Executive's employment is terminated by reason of the
Executive's death during the Employment Term, this Agreement shall terminate
without further obligations to the Executive's legal representatives under this
Agreement, other than for (i) payment of Accrued Obligations (which shall be
paid to the Executive's estate or beneficiary, as applicable, in a lump sum in
cash within 30 days of the Date of Termination) and the timely payment or
provision of the Welfare Benefit Continuation and the Other Benefits and (ii)
payment to the
 
                                       10
 
<PAGE>   14
 
 
 
Executive's estate or beneficiaries, as applicable, in a lump sum in cash within
30 days of the Date of Termination of an amount equal to the sum of the
Severance Amount and the Supplemental Retirement Amount. With respect to the
provision of Other Benefits, the term Other Benefits as used in this Section
6(b) shall include, without limitation, and the Executive's estate and/or
beneficiaries shall be entitled to receive, benefits at least equal to the most
favorable benefits provided by the Company and affiliated companies to the
estates and beneficiaries of peer executives of the Company and such affiliated
companies under such plans, programs, practices, and policies relating to death
benefits, if any, as in effect with respect to other peer executives and their
beneficiaries at any time during the 120-day period immediately preceding the
Effective Date or, if more favorable to the Executive's estate and/or the
Executive's beneficiaries, as in effect on the date of the Executive's death
with respect to other peer executives of the Company and its affiliated
companies and their beneficiaries.
 
         (c) Disability. If the Executive's employment is terminated by reason
of the Executive's Disability during the Employment Term, this Agreement shall
terminate without further obligations to the Executive, other than for (i)
payment of Accrued Obligations (which shall be paid to the Executive in a lump
sum in cash within 30 days of the Date of Termination) and the timely payment or
provision of the Welfare Benefit Continuation and the Other Benefits and (ii)
payment to the Executive in a lump sum in cash within 30 days of the Date of
Termination of an amount equal to the sum of the Severance Amount and the
Supplemental Retirement Amount. With respect to the provision of Other Benefits,
the term Other Benefits as used in this Section 6(c) shall include, without
limitation, and the Executive shall be entitled after the Disability Effective
Date to receive, disability and other benefits at least equal to the most
favorable of those generally provided by the Company and affiliated companies to
disabled executives and/or their families in accordance with such plans,
programs, practices, and policies relating to disability, if any, as in effect
generally with respect to other peer executives and their families at any time
during the 120-day period immediately preceding the Effective Date or, if more
favorable to the Executive and/or the Executive's family, as in effect at any
time thereafter generally with respect to other peer executives of the Company
and its affiliated companies and their families.
 
         (d) Cause; Other Than for Good Reason or During the Window Period. If
the Executive's employment is terminated for Cause during the Employment Term,
this Agreement shall terminate without further obligations to the Executive
other than the obligation to pay to the Executive Base Salary through the Date
of Termination plus the amount of any compensation previously deferred by the
Executive, in each case to the extent theretofore unpaid. If the Executive
voluntarily terminates the Executive's employment during the Employment Term,
excluding a termination either for Good Reason or without any reason during the
Window Period, this Agreement shall terminate without further obligations to the
Executive, other than for Accrued Obligations and the timely payment or
provision of the Other Benefits. In such case, all Accrued Obligations shall be
paid to the Executive in a lump sum in cash within 30 days of the Date of
Termination subject to applicable laws and regulations.
 
 
                                       11
 
<PAGE>   15
 
 
 
         7. Certain Additional Payments by the Company.
 
         (a) Notwithstanding any provision in this Agreement to the contrary and
except as set forth below, if it shall be determined that any payment or
distribution by the Company to or for the benefit of the Executive (whether paid
or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise, but determined without regard to any additional payments
required pursuant to this Paragraph 7) (a "Payment") would be subject to the
excise tax imposed by Section 4999 of the Code or any interest or penalties are
incurred by the Executive with respect to such excise tax (such excise tax,
together with any such interest and penalties, are hereinafter collectively
referred to as the "Excise Tax"), then the Executive shall be entitled to
receive an additional payment (a "Gross-Up Payment") in an amount such that
after payment by the Executive of all taxes (including any interest or penalties
imposed with respect to such taxes), including any income taxes (and any
interest and penalties imposed with respect thereto) and Excise Tax imposed upon
the Gross-Up Payment, the Executive retains an amount of the GrossUp Payment
equal to the Excise Tax imposed upon the Payments. Notwithstanding the foregoing
provisions of this Paragraph 7(a), if it shall be determined that the Executive
is entitled to a Gross-Up Payment, but that the Executive, after taking into
account the Payments and the Gross-Up Payment, would not receive a net after-tax
benefit of at least $50,000 (taking into account both income taxes and any
Excise Tax) as compared to the net after-tax proceeds to the Executive resulting
from an elimination of the Gross-Up Payment and a reduction of the Payments, in
the aggregate, to an amount (the "Reduced Amount") such that the receipt of
payments would not give rise to any Excise Tax, then no Gross-Up Payment shall
be made to the Executive and the Payments, in the aggregate, shall be reduced to
the Reduced Amount.
 
         (b) Subject to the provisions of Paragraph 7(c), all determinations
required to be made under this Paragraph 7, including whether and when a
Gross-Up Payment is required and the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determination, shall be made by
PricewaterhouseCoopers (the "Accounting Firm") or, as provided below, such other
certified public accounting firm as may be designated by the Executive, which
shall provide detailed supporting calculations both to the Company and the
Executive within 15 business days after the receipt of notice from the Executive
that there has been a Payment, or such earlier time as is requested by the
Company. If the Accounting Firm is serving as accountant or auditor for the
individual, entity, or group effecting the Change of Control, the Executive
shall have the option, in the Executive's sole discretion, to appoint another
nationally recognized accounting firm to make the determinations required
hereunder (which accounting firm shall then be referred to as the Accounting
Firm hereunder). All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any Gross-Up Payment, as determined pursuant to this
Paragraph 7, shall be paid by the Company to the Executive within five days of
the receipt of the Accounting Firm's determination. If the Accounting Firm
determines that no Excise Tax is payable by the Executive, it shall furnish the
Executive with a written opinion that failure to report the Excise Tax on the
Executive's applicable federal income tax return would not result in the
imposition of a negligence or similar penalty. Any determination by the
Accounting Firm shall be binding upon the Company and the Executive. As a result
of the uncertainty in the application of Section 4999 of the Code at the time of
the initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments that will not have been made by the Company
 
                                       12
 
<PAGE>   16
 
 
 
should have been made ("Underpayment"), consistent with the calculations
required to be made hereunder. If the Company exhausts its remedies pursuant to
Paragraph 7(c) and the Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment
that has occurred and any such Underpayment shall be promptly paid by the
Company to or for the benefit of the Executive.
 
         (c) The Executive shall notify the Company in writing of any claim by
the Internal Revenue Service that, if successful, would require the payment by
the Company of the Gross-Up Payment (or an additional amount of Gross-Up
Payment) in the event the Internal Revenue Service seeks higher payment. Such
notification shall be given as soon as practicable but no later than 10 business
days after the Executive is informed in writing of such claim and shall apprise
the Company of the nature of such claim and the date on which such claim is
requested to be paid. The Executive shall not pay such claim prior to the
expiration of the 30-day period following the date on which it gives such notice
to the Company (or such shorter period ending on the date that any payment of
taxes with respect to such claim is due). If the Company notifies the Executive
in writing prior to the expiration of such period that it desires to contest
such claim, the Executive shall:
 
                      (i) give the Company any information reasonably requested
         by the Company relating to such claim;
 
                      (ii) take such action in connection with contesting such
         claim as the Company shall reasonably request in writing from time to
         time, including the acceptance of legal representation with respect to
         such claim by an attorney reasonably selected by the Company;
 
                      (iii) cooperate with the Company in good faith in order
         effectively to contest such claim; and
 
                      (iv) permit the Company to participate in any proceedings
         relating to such claim;
 
provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses. Without limitation of the foregoing provisions of
this Paragraph 7(c), the Company shall control all proceedings taken in
connection with such contest and, at its sole option, may pursue or forgo any
and all administrative appeals, proceedings, hearings, and conferences with the
taxing authority in respect of such claim and may, at its sole option, either
direct the Executive to pay the tax claimed and sue for a refund or contest the
claim in any permissible manner, and the Executive agrees to prosecute such
contest to a determination before any administrative tribunal, in a court of
initial jurisdiction, and in one or more appellate courts, as the Company shall
determine; provided, however, that if the Company directs the Executive to pay
such claim and sue for a refund, the Company shall advance the amount of such
payment to
 
                                       13
 
<PAGE>   17
 
 
 
the Executive, on an interest-free basis, and shall indemnify and hold the
Executive harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect to
such advance or with respect to any imputed income with respect to such advance;
and provided further that any extension of the statute of limitations relating
to payment of taxes for the taxable year of the Executive with respect to which
such contested amount is claimed to be due is limited solely to such contested
amount. Furthermore, the Company's control of the contest shall be limited to
issues with respect to which a Gross-Up Payment would be payable hereunder and
the Executive shall be entitled to settle or contest, as the case may be, any
other issue raised by the Internal Revenue Service or any other taxing
authority.
 
         (d) If, after the receipt by the Executive of an amount advanced by the
Company pursuant to Paragraph 7(c), the Executive becomes entitled to receive
any refund with respect to such claim, the Executive shall (subject to the
Company's complying with the requirements of Paragraph 7(c)) promptly pay to the
Company the amount of such refund (together with any interest paid or credited
thereon after taxes applicable thereto). If, after the receipt by the Executive
of an amount advanced by the Company pursuant to Paragraph 7(c), a determination
is made that the Executive shall not be entitled to any refund with respect to
such claim and the Company does not notify the Executive in writing of its
intent to contest such denial of refund prior to the expiration of 30 days after
such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.
 
         8. Representations and Warranties.
 
         (a) The Company represents and warrants to the Executive that the
execution, delivery, and performance by the Company of this Agreement have been
duly authorized by all necessary corporate action of the Company and do not and
will not conflict with or result in a violation of any provision of, or
constitute a default under, any contract, agreement, instrument, or obligation
to which the Company is a party or by which it is bound.
 
         (b) The Executive represents and warrants to the Company that the
execution, delivery, and performance by the Executive of this Agreement do not
and will not conflict with or result in a violation of any provision of, or
constitute a default under, any contract, agreement, instrument, or obligation
to which the Executive is a party or by which the Executive is bound.
 
         9. Confidential Information. The Executive recognizes and acknowledges
that the Company's trade secrets and other confidential or proprietary
information, as they may exist from time to time, are valuable, special, and
unique assets of the Company's business, access to and knowledge of which are
essential to the performance of the Executive's duties hereunder. The Executive
confirms that all such trade secrets and other information constitute the
exclusive property of the Company. During the Employment Term and thereafter
without limitation of time, the Executive shall hold in strict confidence and
shall not, directly or indirectly, disclose or reveal to any person, or use for
the Executive's own personal benefit or for the benefit of anyone else, any
trade secrets, confidential dealings, or other confidential or proprietary
information of any kind, nature, or description (whether or not acquired,
learned, obtained, or developed by the
 
                                       14
 
<PAGE>   18
 
 
 
Executive alone or in conjunction with others) belonging to or concerning the
Company or any of its affiliated companies, except (i) with the prior written
consent of the Company duly authorized by its Board, (ii) in the course of the
proper performance of the Executive's duties hereunder, (iii) for information
(x) that becomes generally available to the public other than as a result of
unauthorized disclosure by the Executive or the Executive's affiliates or (y)
that becomes available to the Executive on a nonconfidential basis from a source
other than the Company or its affiliated companies who is not bound by a duty of
confidentiality, or other contractual, legal, or fiduciary obligation, to the
Company, or (iv) as required by applicable law or legal process. The provisions
of this Paragraph 9 shall continue in effect notwithstanding termination of the
Executive's employment hereunder for any reason.
 
         10. Certain Definitions.
 
         (a) Effective Date. The "Effective Date" shall mean the first date
during the Change of Control Period (as defined in Paragraph 10(b)) on which a
Change of Control occurs. Notwithstanding anything in this Agreement to the
contrary, if a Change of Control occurs and if the Executive's employment with
the Company is terminated prior to the date on which the Change of Control
occurs, and if it is reasonably demonstrated by the Executive that such
termination of employment (i) was at the request of a third party who has taken
steps reasonably calculated to effect a Change of Control or (ii) otherwise
arose in connection with or anticipation of a Change of Control, then for all
purposes of this Agreement the "Effective Date" shall mean the date immediately
prior to the date of such termination of employment.
 
         (b) Change of Control Period. The "Change of Control Period" shall mean
the period commencing on the date of this Agreement and ending on the third
anniversary of such date; provided, however, that commencing on the date one
year after the date hereof, and on each annual anniversary of such date (such
date and each annual anniversary thereof herein referred to as the "Renewal
Date"), the Change of Control Period shall be automatically extended so as to
terminate three years after such Renewal Date, unless at least 60 days prior to
the Renewal Date the Company shall give notice to the Executive that the Change
of Control Period shall not be so extended.
 
         (c) Change of Control. For purposes of this Agreement, a "Change of
Control" shall mean:
 
                      (i) the acquisition by any individual, entity, or group
         (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange
         Act) (a "Person") of beneficial ownership (within the meaning of Rule
         13d-3 promulgated under the Exchange Act) of 15% or more of either (A)
         the then outstanding shares of common stock of the Company (the
         "Outstanding Company Common Stock") 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 for purposes of this subparagraph
         (c)(i) the following acquisitions shall not constitute a Change of
         Control: (w) any acquisition directly from the Company (excluding an
         acquisition by virtue of the exercise of a conversion privilege), (x)
         any acquisition by the Company,
 
                                       15
 
<PAGE>   19
 
 
 
         (y) any acquisition by any employee benefit plan (or related trust)
         sponsored or maintained by the Company or any corporation controlled by
         the Company, or (z) any acquisition by any corporation pursuant to a
         reorganization, merger, or consolidation, if, following such
         reorganization, merger, or consolidation, the conditions described in
         clauses (A), (B), and (C) of subparagraph (iii) of this Paragraph 10
         (c) are satisfied; or
 
                      (ii) individuals who, as of the date of this Agreement,
         constitute the Board (the "Incumbent Board") cease for any reason to
         constitute 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 stockholders, was
         approved by a vote of a majority of the directors then comprising the
         Incumbent Board shall 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 or other actual or
         threatened solicitation of proxies or consents by or on behalf of a
         Person other than the Board; or
 
                      (iii) consummation of a reorganization, merger, or
         consolidation of the Company, with or without approval by the
         stockholders of the Company, in each case, unless, following such
         reorganization, merger, or consolidation, (A) more than 50% of,
         respectively, the then outstanding shares of common stock of the
         corporation resulting from such reorganization, merger, or
         consolidation and the combined voting power of the then outstanding
         voting securities of such corporation 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 Common Stock and Outstanding Company Voting Securities
         immediately prior to such reorganization, merger, or consolidation in
         substantially the same proportions as their ownership, immediately
         prior to such reorganization, merger, or consolidation, of the
         Outstanding Company Common Stock and Outstanding Company Voting
         Securities, as the case may be, (B) no Person (excluding the Company,
         any employee benefit plan (or related trust) of the Company or such
         corporation resulting from such reorganization, merger, or
         consolidation, and any Person beneficially owning, immediately prior to
         such reorganization, merger, or consolidation, directly or indirectly,
         15% or more of the Outstanding Company Common Stock or Outstanding
         Company Voting Securities, as the case may be) beneficially owns,
         directly or indirectly, 15% or more of, respectively, the then
         outstanding shares of common stock of the corporation resulting from
         such reorganization, merger, or consolidation or the combined voting
         power of the then outstanding voting securities of such corporation
         entitled to vote generally in the election of directors, and (C) a
         majority of the members of the board of directors of the corporation
         resulting from such reorganization, merger, or consolidation were
         members of the Incumbent Board at the time of the execution of the
         initial agreement providing for such reorganization, merger, or
         consolidation; or
 
                      (iv) consummation of a sale or other disposition of all or
         substantially all the assets of the Company, with or without approval
         by the stockholders of the Company, other than to a corporation, with
         respect to which following such sale or other disposition,
 
                                       16
 
<PAGE>   20
 
 
 
         (A) more than 50% of, respectively, the then outstanding shares of
         common stock of such corporation and the combined voting power of the
         then outstanding voting securities of such corporation entitled to vote
         generally in the election of directors is then beneficially owned,
         directly or indirectly, by all or substantially all the individuals and
         entities who were the beneficial owners, respectively, of the
         Outstanding Company Common Stock and Outstanding Company Voting
         Securities immediately prior to such sale or other disposition in
         substantially the same proportion as their ownership, immediately prior
         to such sale or other disposition, of the Outstanding Company Common
         Stock and Outstanding Company Voting Securities, as the case may be,
         (B) no Person (excluding the Company, any employee benefit plan (or
         related trust) of the Company or such corporation, and any Person
         beneficially owning, immediately prior to such sale or other
         disposition, directly or indirectly, 15% or more of the Outstanding
         Company Common Stock or Outstanding Company Voting Securities, as the
         case may be) beneficially owns, directly or indirectly, 15% or more of,
         respectively, the then outstanding shares of common stock of such
         corporation or the combined voting power of the then outstanding voting
         securities of such corporation entitled to vote generally in the
         election of directors, and (C) 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 of the
         Company; or
 
                      (v) approval by the stockholders of the Company of a
         complete liquidation or dissolution of the Company.
 
         11. Full Settlement.
 
         (a) There shall be no right of set off or counterclaim against, or
delay in, any payments to the Executive, or to the Executive's heirs or legal
representatives, provided for in this Agreement, in respect of any claim against
or debt or other obligation of the Executive or others, whether arising
hereunder or otherwise.
 
         (b) In no event shall the Executive be obligated to seek other
employment or take any other action by way of mitigation of the amounts payable
to the Executive under any of the provisions of this Agreement, and such amounts
shall not be reduced whether or not the Executive obtains other employment.
 
         (c) The Company agrees to pay as incurred, to the full extent permitted
by law, all costs and expenses (including attorneys' fees) that the Executive,
or the Executive's heirs or legal representatives, may reasonably incur as a
result of any contest (regardless of the outcome thereof) by the Company, the
Executive, or others of the validity or enforceability of, or liability under,
any provision of this Agreement, or any guarantee of performance thereof
(including as a result of any contest by the Executive, or the Executive's heirs
or legal representatives, about the amount of any payment pursuant to this
Agreement), plus in each case interest on any delayed payment at the applicable
federal rate provided for in Section 7872(f)(2) of the Code.
 
 
                                       17
 
<PAGE>   21
 
 
 
         12. No Effect on Other Contractual Rights. The provisions of this
Agreement, and any payment provided for hereunder, shall not reduce any amounts
otherwise payable to the Executive, or in any way diminish the Executive's
rights as an employee of the Company, whether existing on the date of this
Agreement or hereafter, under any employee benefit plan, program, or arrangement
or other contract or agreement of the Company providing benefits to the
Executive.
 
         13. Indemnification; Directors and Officers Insurance. The Company
shall (a) during the Employment Term and thereafter without limitation of time,
indemnify and advance expenses to the Executive to the fullest extent permitted
by the laws of the State of Delaware from time to time in effect and (b) during
the Employment Term, acquire and maintain directors and officers liability
insurance covering the Executive (and to the extent the Company desires, other
directors and officers of the Company and its affiliated companies) to the
extent it is available at commercially reasonable rates as determined by the
Board; provided, however, that in no event shall the Executive be entitled to
indemnification or advancement of expenses under this Paragraph 13 with respect
to any proceeding, or matter therein, brought or made by the Executive against
the Company other than one initiated by the Executive to enforce the Executive's
rights under this Paragraph 13. The rights of indemnification and to receive
advancement of expenses as provided in this Paragraph 13 shall not be deemed
exclusive of any other rights to which the Executive may at any time be entitled
under applicable law, the certificate of incorporation or bylaws of the Company,
any agreement, a vote of stockholders, a resolution of the Board, or otherwise.
The provisions of this Paragraph 13 shall continue in effect notwithstanding
termination of the Executive's employment hereunder for any reason.
 
         14. Injunctive Relief. In recognition of the fact that a breach by the
Executive of any of the provisions of Paragraph 9 will cause irreparable damage
to the Company for which monetary damages alone will not constitute an adequate
remedy, the Company shall be entitled as a matter of right (without being
required to prove damages or furnish any bond or other security) to obtain a
restraining order, an injunction, an order of specific performance, or other
equitable or extraordinary relief from any court of competent jurisdiction
restraining any further violation of such provisions by the Executive or
requiring the Executive to perform the Executive's obligations hereunder. Such
right to equitable or extraordinary relief shall not be exclusive but shall be
in addition to all other rights and remedies to which the Company may be
entitled at law or in equity, including without limitation the right to recover
monetary damages for the breach by the Executive of any of the provisions of
this Agreement.
 
         15. Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Texas, without regard
to the principles of conflicts of laws thereof.
 
         16. Notices. All notices, requests, demands, and other communications
required or permitted to be given or made hereunder by either party hereto shall
be in writing and shall be deemed to have been duly given or made (i) when
delivered personally, (ii) when sent by telefacsimile transmission, or (iii)
five days after being deposited in the United States mail, first class
registered or certified mail, postage prepaid, return receipt requested, to the
party for which
 
                                       18
 
<PAGE>   22
 
 
 
intended at the following addresses (or at such other addresses as shall be
specified by the parties by like notice, except that notices of change of
address shall be effective only upon receipt):
 
             If to the Company, at:    Noble Drilling Corporation
                                       10370 Richmond Avenue, Suite 400
                                       Houston, Texas 77042
                                       Fax No.:  713-974-3181
                                       Attention: Chief Executive Officer
 
             If to the Executive, at:  James C. Day
                                       Noble Drilling Corporation
                                       10370 Richmond Avenue, Suite 400
                                       Houston, Texas 77042
                                       Fax No.: 713-974-3181
 
         17. Binding Effect; Assignment; No Third Party Benefit.
 
         (a) This Agreement is personal to the Executive and without the prior
written consent of the Company shall not be assignable by the Executive
otherwise than by will or the laws of descent and distribution. This Agreement
shall inure to the benefit of and shall be enforceable by the Executive's legal
representatives.
 
         (b) This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.
 
         (c) The Company shall require any successor or assign (whether direct
or indirect, by purchase, merger, consolidation, or otherwise) to all or
substantially all the business and/or assets of the Company, by agreement in
writing in form and substance reasonably satisfactory to the Executive,
expressly, absolutely, and unconditionally to assume and agree to perform this
Agreement in the same manner and to the same extent that the Company would be
required to perform it if no such succession or assignment had taken place. As
used in this Agreement, the "Company" shall mean the Company as hereinbefore
defined and any successor or assign to its business and/or assets as aforesaid
which executes and delivers the agreement provided for in this Paragraph 17(c)
or which otherwise becomes bound by all the terms and provisions of this
Agreement by operation of law.
 
         (d) Nothing in this Agreement, express or implied, is intended to or
shall confer upon any person other than the parties hereto, and their respective
heirs, legal representatives, successors, and permitted assigns, any rights,
benefits, or remedies of any nature whatsoever under or by reason of this
Agreement.
 
         18. Miscellaneous.
 
         (a) Amendment. This Agreement may not be modified or amended in any
respect except by an instrument in writing signed by the party against whom such
modification or amendment is sought to be enforced. No person, other than
pursuant to a resolution of the Board
 
                                       19
 
<PAGE>   23
 
 
 
or a committee thereof, shall have authority on behalf of the Company to agree
to modify, amend, or waive any provision of this Agreement or anything in
reference thereto.
 
         (b) Waiver. Any term or condition of this Agreement may be waived at
any time by the party hereto which is entitled to have the benefit thereof, but
such waiver shall only be effective if evidenced by a writing signed by such
party, and a waiver on one occasion shall not be deemed to be a waiver of the
same or any other type of breach on a future occasion. No failure or delay by a
party hereto in exercising any right or power hereunder shall operate as a
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right or power.
 
         (c) Withholding Taxes. The Company may withhold from any amounts
payable under this Agreement such federal, state, local, or foreign taxes as
shall be required to be withheld pursuant to any applicable law or regulation.
 
         (d) Nonalienation of Benefits. The Executive shall not have any right
to pledge, hypothecate, anticipate, or in any way create a lien upon any
payments or other benefits provided under this Agreement; and no benefits
payable hereunder shall be assignable in anticipation of payment either by
voluntary or involuntary acts, or by operation of law, except by will or
pursuant to the laws of descent and distribution.
 
         (e) Severability. If any provision of this Agreement is held to be
invalid or unenforceable, (a) this Agreement shall be considered divisible, (b)
such provision shall be deemed inoperative to the extent it is deemed invalid or
unenforceable, and (c) in all other respects this Agreement shall remain in full
force and effect; provided, however, that if any such provision may be made
valid or enforceable by limitation thereof, then such provision shall be deemed
to be so limited and shall be valid and/or enforceable to the maximum extent
permitted by applicable law.
 
         (f) Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto concerning the subject matter hereof, and from and
after the date of this Agreement, this Agreement shall supersede any other prior
agreement or understanding, both written and oral, between the parties with
respect to such subject matter.
 
         (g) Captions. The captions herein are inserted for convenience of
reference only, do not constitute a part of this Agreement, and shall not affect
in any manner the meaning or interpretation of this Agreement.
 
         (h) References. All references in this Agreement to Paragraphs,
subparagraphs, and other subdivisions refer to the Paragraphs, subparagraphs,
and other subdivisions of this Agreement unless expressly provided otherwise.
The words "this Agreement", "herein", "hereof", "hereby", "hereunder", and words
of similar import refer to this Agreement as a whole and not to any particular
subdivision unless expressly so limited. Whenever the words "include",
"includes", and "including" are used in this Agreement, such words shall be
deemed to be followed by the words "without limitation". Words in the singular
form shall be construed to include the plural and vice versa, unless the context
otherwise requires.
 
                                       20
 
<PAGE>   24
 
 
 
         IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed on its behalf by its duly authorized officer, and the Executive has
executed this Agreement, as of the date first above set forth.
 
                                    NOBLE DRILLING CORPORATION
 
 
                                    By: /S/ BYRON L. WELLIVER
                                       ----------------------------------------
                                        Name:   Byron L. Welliver
                                        Title:  Senior Vice President - Finance,
                                                Treasurer and Controller
 
                                                                       "COMPANY"
 
 
 
                                    /S/ JAMES C. DAY
                                    -------------------------------------------
                                    James C. Day
 
                                                                     "EXECUTIVE"